EXHIBIT 10.1

AGREEMENT OF PURCHASE AND SALE
AND JOINT ESCROW INSTRUCTIONS
THIS AGREEMENT OF PURCHASE AND SALE AND JOINT ESCROW INSTRUCTIONS (“Agreement”)
is made and entered into as of the 16th day of February, 2017 (“Execution Date”)
by and between ARLINGTON MEDICAL PROPERTIES, LLC, an Arizona limited liability
company (“Seller”), UNIVERSAL HEALTH REALTY INCOME TRUST, a Maryland real estate
investment trust (“Seller Guarantor”), and GAHC4 RENO NV MOB, LLC, a Delaware
limited liability company (“Buyer”).
R E C I T A L S:
A.    Seller is the owner of a ground leasehold interest in the Real Property
(as defined below) located at 235 West Sixth Street in the City of Reno
(“City”), County of Washoe (“County”), State of Nevada (“State”) and more
particularly described in Exhibit “A” attached hereto.
B.    Capitalized terms shall have the meanings set forth in connection with the
use of such terms. If no definition is so set forth such capitalized terms shall
have the meanings set forth in Paragraph 1 of this Agreement.
C.    Buyer desires to purchase from Seller, and Seller desires to sell to
Buyer, the Property, in accordance with the terms of this Agreement.
BASIC PROVISIONS
1.
Seller:
Arlington Medical Properties, LLC
4722 North 24th Street, Suite 400
Phoenix, AZ 85016
Attn: Randy McGrane
Email: rmcgrane@ensemble.net
 
and
 
 
 
Arlington Medical Properties, LLC
c/o Universal Health Realty Income Trust
367 S. Gulph Road
P.O. Box 61558
King of Prussia, PA 19406-0958
Attn: Cheryl Ramagano
Email: cherly.ramagano@uhsinc.com
 
 
 
2.
Seller’s Counsel:
Elkins Kalt Weintraub Reuben Gartside LLP
2049 Century Park East, Suite 2700
Los Angeles, CA 90067
Attn: Scott M. Kalt, Esq.
Telephone No. (310) 746-4402
Facsimile No. (310) 746-4499
Email: skalt@elkinskalt.com

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3.
Buyer:
GAHC4 Reno NV MOB, LLC
c/o American Healthcare Investors LLC
18191 Von Karman Ave., Suite 300
Irvine, CA 92612
Attn: Danny Prosky
Telephone No. (949) 270-9201
E-mail: DProsky@ahinvestors.com
 
 
 
4.
Buyer’s Counsel:
Moran, Reeves & Conn, PC
100 Shockoe Slip, 4th Floor
Richmond, Virginia 23219
Attn: Joseph J. McQuade
Telephone No. (804) 864-4812
Email: jmcquade@mrcpclaw.com
 
 
 
5.
Broker:
CBRE Healthcare Capital Markets
1225 Seventeenth St., Suite 2950
Denver, CO 80202
Attn: Chris Bodnar
Telephone: (303) 628-1711
Facsimile: (303) 628-1751
Email: chris.bodnar@cbre.com
 
 
 
6.
Escrow Holder:
First American Title Insurance Company
2425 E. Camelback Road, Suite 300
Phoenix, AZ 85016
Attn: Angelique Sizemore
Telephone: (602) 567-8118
Facsimile: (602) 567-8101
Email: asizemore@firstam.com
 
 
 
7.
Title Company:
First American Title Insurance Company
2425 E. Camelback Road, Suite 300
Phoenix, AZ 85016
Attn: Angelique Sizemore
Telephone: (602) 567-8118
Facsimile: (888) 524-2123
Email: asizemore@firstam.com
 
 
 
8.
Purchase Price:
Sixty-Six Million Two Hundred Fifty Thousand Dollars ($66,250,000).
 
 
 
9.
Deposit:
Two Million Dollars ($2,000,000)
 
 
 
10.
Contingency Date:
March 8, 2017
 
 
 

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11.
Scheduled Closing Date:
Earlier of (i) fifteen (15) days after the Contingency Date; or (ii) March 13,
2017.

AGREEMENT
NOW THEREFORE, incorporating the foregoing recitals, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows.
1.     Definitions. For purposes of this Agreement, the following terms shall
have the following meaning:
1.1     “Authorities” means any governmental or quasi-governmental body or
agency having jurisdiction over the Property and/or Seller including, without
limitation, the State, the City and the County.
1.2     “Broker” means CBRE Healthcare Capital Markets.
1.3     “Business Day” means all days other than Saturdays, Sundays or holidays.
1.4     “Cash Equivalent” means a wire transfer of funds.
1.5     “Close of Escrow” or “Closing” means the date the Deed is recorded in
the Official Records, or such earlier date on which the Title Company
unconditionally commits to issue the Title Policy defined in Paragraph 7.1.1
below (i.e., a “gap closing”).
1.6     “Closing Date” means the earlier of: (i) fifteen (15) days after the
Contingency Date; or (ii) March 13, 2017, or such earlier date agreed upon by
the parties.
1.7      Contingency Date” means March 8, 2017.
1.8     “Contingency Period” has the meaning provided in Paragraph 7.1.2.
1.9     “Escrow” means the above-referenced escrow opened with Escrow Holder for
the consummation of the transaction described in this Agreement.
1.10     “Escrow Holder” means First American Title Insurance Company.
1.11     “Estoppel Certificate Percentage” means (a) one hundred percent (100%)
of the square footage of space leased under Hospital Leases, and (b)
seventy-five percent (75%) of the square footage of other leased space at the
Property.
1.12     “Governmental Regulations” means any laws, ordinances, rules,
requirements, resolutions, policy statements and regulations (including, without
limitation, those relating to land use, subdivision, zoning, environmental,
toxic or hazardous waste, occupational health and safety, water, earthquake
hazard reduction, disabled persons and building and fire

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codes) of the Authorities bearing on the construction, alteration,
rehabilitation, maintenance, use, operation or sale of the Property.
1.13     “Ground Lease” means that certain Ground Lease Agreement dated as of
July 31, 2003 (as amended), by and between Seller and Prime Healthcare
Services-Reno, LLC, successor in interest to Saint Mary’s Health Care
Corporation (“Ground Lessor”).
1.14     “Hazardous Material” means any radioactive, hazardous or toxic
substance, material or waste which is regulated by any local governmental
authority, the State or the United States Government. The term “Hazardous
Material” includes, without limitation, any material or substance which is
(i) defined as a “hazardous waste,” “extremely hazardous waste” or “restricted
hazardous waste” or “hazardous substance” under any state or federal law,
(ii) asbestos, (iii) lead, and/or (iv) petroleum.
1.15     “Hospital Leases” means Leases to Ground Lessor (as a tenant of the
Property).
1.16     “Improvements” means all of Seller’s interest in the building located
on the Real Property, associated parking and landscaped areas and all other
improvements located on the Real Property.
1.17     “Leases” means all leases (including, without limitation, the Hospital
Leases), use licenses, rental agreements or occupancy agreements, and all
amendments and supplements thereto, relating to all or any portion of the
Property (together with all rents, issues and profits thereunder) as set forth
on the Rent Roll, and all of Seller’s right title and interest in and to all
guarantees, letters of credit and other similar credit enhancements providing
additional security for such Leases.
1.18     “Licenses and Permits” means (A) all assignable licenses, permits,
certificates of occupancy, approvals, dedications, subdivision maps and
entitlements issued, approved or granted by Authorities or otherwise in
connection with the Property, (B) all assignable right, title and interest of
Seller in and to any and all trade names and logos used by Seller in the
operation and identification of the Property; (C) any and all assignable
development rights and other intangible rights, titles, interests, privileges
and appurtenances owned by Seller used in connection with the Property and its
operation; (D) assignable maps, building inspection approvals and covenants,
conditions and restrictions, reciprocal easement agreements, area easement
agreements and other common or planned development agreements affecting the
Property; and (E) all assignable use licenses, consents, easements, rights of
way and approvals required from private parties to make use of utilities and to
insure vehicular and pedestrian ingress and egress to the Property.
1.19     “Official Records” means the Official Records of the County.
1.20     “Opening of Escrow” means the date on which a fully executed copy of
this Agreement is delivered to Escrow Holder by Buyer and Seller.
1.21     “Personal Property” means all personal property, equipment, supplies
and fixtures owned by Seller which are located at and used in the operation of
the Real Property.

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1.22     “Property” means, collectively, Seller’s right, title and interest to
and in (a) the Real Property (comprised of Seller’s ground leasehold interest
under the Ground Lease); (b) the Personal Property, Improvements, Warranties,
Records and Plans, Leases and Service Contracts; (c) all appurtenances, streets,
alleys, easements, right-of-way in or to all streets or other interests in, on,
across, in front of, abutting or adjoining the Real Property, if any;
(d) appurtenances which are used in connection with the Real Property, if any;
and (e) all development rights, air rights, water rights, water stock,
entitlements, minerals, and oil and gas privileges and rights, if any, which
pertain to the Real Property.
1.23     “Real Property” means that certain real property located in the City
and County more particularly described in Exhibit “A” attached hereto and
incorporated herein by this reference, together with all right, title and
interest of the Seller in and to all streets, alleys, easements and
rights-of-way in, on, across, in front of, abutting or adjoining said real
property.
1.24     “Records and Plans” means all surveys, grading plans, topographical
maps, and all engineering, soils, seismic, geologic, environmental contamination
and architectural reports, studies and certificates pertaining to the Property.
1.25      “Rent Roll” means a listing of all tenants of the Property,
identifying, among other things, the tenant name, suite number, rentable square
footage leased, base rent and security deposit.
1.26     “Service Contracts” means the service contracts, maintenance contracts,
operating contracts, management contracts, warranties, guarantees, bonds,
listing agreements, parking contracts and like contracts and agreements solely
relating to the Property and to which Seller or Seller’s property manager are a
party, together with all supplements, amendments and modifications thereto as
set forth on Schedule 1.26 hereto, and specifically excluding that certain
Management Agreement by and between Seller and Seller’s property manager, and
any other Service Contracts Buyer elects not to assume pursuant to Paragraph
14.2 below.
1.27     “Tenants” means the tenants under the Leases.
1.28     “Title Company” means First American Title Insurance Company.
1.29     “To the best of Seller’s knowledge” or other references herein to
Seller’s knowledge mean the actual knowledge (without duty of investigation) of
Randy McGrane (such individual, “Seller’s Representative”). Seller represents
that Randy McGrane is the individual on behalf of Seller with the most knowledge
of the matters which are the subject of the representations and warranties set
forth in Paragraph 13 below and the individual to whom material facts relevant
to such matters would be reported in the ordinary course, provided that Randy
McGrane shall not be subject to personal liability for such representations and
warranties and the transactions contemplated by this Agreement.
1.30     “Warranties” means Seller’s right, title and interest in and to any
assignable guarantees and warranties relating to the use and operation of the
Property
2.     Purchase and Sale. Seller agrees to sell to Buyer, and Buyer agrees to
purchase from Seller, the Property upon the terms and conditions set forth in
this Agreement.

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3.     Purchase Price. The Purchase Price (“Purchase Price”) for the Property
shall be Sixty-Six Million Two Hundred Fifty Thousand Dollars ($66,250,000).
4.     Payment of Purchase Price. The Purchase Price shall be paid as follows:
4.1     Deposit. Within three (3) Business Days after the Opening of Escrow,
Buyer shall deposit with Escrow Holder via wire transfer in immediately
available U.S. funds made payable to Escrow Holder in the amount of Two Million
Dollars ($2,000,000) (together with all interest that is earned thereon, the
“Deposit”). The Deposit shall be fully refundable to Buyer up through and
including the Contingency Date such that if Buyer elects to terminate this
Agreement on or before the Contingency Date (which Buyer may do for any reason
or no reason at all in Buyer’s sole and absolute discretion), then the Deposit
shall be fully refunded to Buyer. If Buyer has not elected to terminate this
Agreement on or before the Contingency Date, then the Deposit shall thereafter
be non-refundable unless the Closing does not occur due to Seller’s default, the
failure of an express closing condition after the Contingency Period in favor of
Buyer under this Agreement to be performed or satisfied, a termination under
Paragraph 13 below, a termination under Paragraph 16 below, or a termination
under Paragraph 25 below. Upon the Close of Escrow, the Deposit shall be
credited toward payment of the Purchase Price.
4.2     Cash Balance. On or before the Closing Date, Buyer shall deposit or
cause to be deposited with Escrow Holder, by wire transfer, the balance of the
Purchase Price (i.e. the Purchase Price minus the Deposit), plus or minus
Buyer’s share of closing costs and prorations as set forth in this Agreement.
5.     Condition of Title. At the Close of Escrow, Seller shall convey to Buyer
the Property by means of an assignment of the Ground Lease and a deed for the
Improvements, subject only to the following matters (“Approved Title
Conditions”): (A) a lien for general real property taxes, not then delinquent;
(B) matters of title respecting the Real Property approved by Buyer in
accordance with Paragraph 7.1.1 below; and (C) matters affecting the condition
of title to the Property created by or with the written consent of Buyer.
6.     Escrow. Buyer and Seller shall promptly cause the Opening of Escrow by
delivering a fully executed copy of this Agreement to Escrow Holder. The Close
of Escrow shall occur on the date the Deed is recorded in the Official Records,
or such earlier date on which the Title Company unconditionally commits to issue
the Title Policy referred to below (i.e., a “gap closing”). Pursuant to Section
6045 of the Internal Revenue Code of 1986, as amended, Escrow Holder shall be
designated the “closing agent” hereunder and shall be designated solely
responsible for complying with the Tax Reform Act of 1986, as amended (together
with all U.S. Treasury Regulations applicable thereto, the “Tax Code”) with
regard to reporting all settlement information to the Internal Revenue Service.
Escrow Holder executes this Agreement to acknowledge its agreement to (i) serve
as escrow agent in connection with the transaction contemplated hereunder, and
(ii) file all information returns required under the Tax Code in respect of such
transactions and furnish to the Seller any statements required under the Tax
Code in respect of such transactions. Escrow Holder further acknowledges receipt
of the foregoing instructions and agrees to hold and dispose of the funds and
documents deposited in escrow in accordance with these instructions.

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7.     Conditions to the Close of Escrow.
7.1     Conditions Precedent to Buyer’s Obligations. The Close of Escrow and
Buyer’s obligations with respect to the transaction contemplated by this
Agreement are subject to the satisfaction, not later than the Closing Date
(unless otherwise provided), of the following conditions, and the obligations of
the parties with respect to such conditions are as follows.
7.1.1     (a)    Title. At Closing, Title Company shall issue an ALTA Standard
Coverage 2006 Ground Leasehold Policy of Title Insurance showing a ground
leasehold estate in the Property vested in Buyer, subject only to the Approved
Title Conditions, with liability in the amount of the Purchase Price (the “Title
Policy”). Any “extended coverage” or other endorsements to the Title Policy
desired by Buyer shall be obtained by Buyer at its sole cost and expense and
shall in no event be a condition to the Close of Escrow, unless Seller has
agreed to provide such endorsement in order to cure a title objection pursuant
to Seller’s Title Notice (as defined below). In furtherance of the foregoing,
prior to the Closing, Buyer shall have approved the legal description of the
Real Property attached hereto as Exhibit “A” and any matters of title disclosed
by the following documents (collectively, the “Title Documents”), which shall be
delivered to Buyer at Seller’s sole cost and expense: (A) a standard ALTA title
commitment dated no later than thirty (30) days prior to the Execution Date of
this Agreement issued by the Title Company, with respect to the Real Property;
(B) the most recent as-built survey of the Real Property in Seller’s possession
or control (“Seller’s As‑Built Survey”); and (C) legible copies of all recorded
documents referred to in such title commitment. Seller has delivered the Title
Documents to Buyer concurrently with or prior to the execution hereof. Buyer
shall have until the date that is fifteen (15) days after the Execution Date to
give Seller and the Escrow Holder written notice (“Buyer’s Title Notice”) of
Buyer’s disapproval of any matters shown in the Title Documents. The failure of
Buyer to timely give Buyer’s Title Notice shall be deemed to constitute Buyer’s
approval of the legal description and all Title Documents and matters and
conditions set forth therein and waiver of Buyer’s contingency related to review
of title matters. If Buyer disapproves of any matters of title shown in the
Title Documents by delivering Buyer’s Title Notice (noting such disapproval),
then Seller shall have the right, but not the obligation, to indicate which
items Seller shall eliminate from the Title Policy (and as exceptions to title
to the Property), and the manner in which Seller shall do so, by delivering
written notice thereof to Buyer (“Seller’s Title Notice”) within two (2) days
after receiving Buyer’s Title Notice. Seller shall not have any right to deliver
Seller’s Title Notice unless Buyer delivers Buyer’s Title Notice. If Seller
fails to timely deliver Seller’s Title Notice, then Seller shall be deemed to
have elected not to correct any of the matters disclosed in Buyer’s Title Notice
and Buyer may elect, at its option, to either cancel this Agreement and receive
a refund of the Deposit in accordance with Paragraph 7.3 below or waive its
objection and proceed to Closing, subject to the satisfaction of the other terms
and provisions of this Agreement. Buyer shall have the right to disapprove
Seller’s Title Notice, or Seller’s election not to cure any matters disclosed in
Buyer’s Title Notice, as applicable, by delivering written notice thereof to
Seller within three (3) days after the earlier of (A) receipt of Seller’s Title
Notice, or (B) the deadline for delivery of Seller’s Title Notice (the “Buyer’s
Second Title Notice”); and Buyer’s failure to timely do so shall be deemed to
constitute Buyer’s approval of Seller’s Title Notice. If Buyer approves (or is
deemed to approve, as aforesaid) Seller’s Title Notice, then by the Closing Date
Seller shall eliminate those disapproved matters which Seller has agreed to
eliminate in Seller’s Title Notice from the Title Policy. Notwithstanding
anything contained in this Paragraph 7.1.1

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to the contrary, Seller shall be obligated, at its sole cost and expense, to
satisfy or cause to be removed from title, at or prior to Closing, all monetary
encumbrances affecting the Property evidenced by deeds of trust, tax liens,
judgments, mechanics’ liens and/or other liens or charges in a fixed sum
regardless of whether Buyer objects to such matters, and if such monetary
encumbrances are not discharged or removed prior to Closing, Seller authorizes
the use of the Purchase Price or a portion thereof to pay and discharge the same
at Closing.
(b)    Survey. Buyer shall obtain, at Buyer’s expense, an ALTA survey of the
Property (the “Survey”) if desired by the Buyer, including if required by the
Title Company in connection with any “extended coverage” addition to the Policy
desired by Buyer. If the Survey reflects any encroachments, overlaps, unrecorded
easements or similar rights in third parties, or any other adverse matters not
specifically provided for in this Agreement to which Buyer objects, Buyer shall
include such objections in Buyer’s Title Notice. Buyer’s failure to include any
such objection in Buyer’s Title Notice, shall be deemed a waiver of any
objection to the Survey and the matters contained therein, and any right of
Buyer to cancel this Agreement on the basis thereof shall be deemed waived.
7.1.2     Review and Approval of Documents and Materials. Prior to the Execution
Date, Seller delivered to Buyer complete copies of all of the information set
forth on Schedule 7.1.2, attached hereto and made a part hereof (collectively,
the “Materials”). Prior to 5:00 p.m. Pacific time on the Contingency Date (the
period from the Execution Date until 5:00 p.m. Pacific time on the Contingency
Date, the “Contingency Period”), Buyer may review the Materials. Except as
otherwise set forth in Paragraph 13 below, Seller makes no representations or
warranties of any kind whatsoever to Buyer as to the accuracy or completeness of
the content of the Materials or any other information delivered to or made
available to Buyer pursuant to this Agreement, and Seller shall not have any
liability or responsibility to Buyer with respect to the accuracy or
completeness of any of the Materials or other information or based upon or
arising out of any use Buyer may make of the Materials or other information.
Buyer shall have the right to approve or disapprove the Materials in Buyer’s
sole discretion by delivering written notice thereof to Seller and Escrow Holder
on or before 5:00 p.m. Pacific time on the Contingency Date. Buyer’s timely
notice of disapproval of any of the Materials shall constitute Buyer’s election
to terminate this Agreement and receive a refund of the Deposit in accordance
with Paragraph 7.3 below. Buyer’s failure to timely disapprove the Materials
shall be deemed to constitute Buyer’s approval thereof and waiver of this
condition.
7.1.3     Inspections and Studies. Subject to the provisions of Paragraph 19
below, Buyer may conduct such inspections, investigations, tenant interviews,
tests and studies (including, without limitation, investigations with regard to
zoning, and other government regulations, engineering tests, economic
feasibility studies and soils, seismic, environmental contamination and geologic
reports) with respect to the Property as Buyer may elect to make or obtain in
Buyer’s sole discretion (“Due Diligence Inspections”). The cost of any such Due
Diligence Inspections, tests and studies shall be borne by Buyer. Buyer shall
have the right to approve or disapprove the Due Diligence Inspections or any
other matter whatsoever regarding the Property in Buyer’s sole discretion.
Buyer’s delivery to Seller on or before 5:00 p.m. Pacific time on the
Contingency Date of a notice of disapproval of any of the Due Diligence
Inspections or any other matter with respect to the Property shall constitute
Buyer’s election to terminate this Agreement and receive a refund of the Deposit
in accordance with Paragraph 7.3 below. The

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failure of Buyer to provide to Seller written notice of such disapproval by
5:00 p.m. Pacific time on the Contingency Date shall be deemed to constitute its
approval of the results of the Due Diligence Inspections and the Property and
waiver of this condition. If Buyer provides (or is deemed to have provided as
aforesaid) its approval of the results of its Due Diligence Inspections, Buyer
shall proceed to Closing, subject to the satisfaction of the other conditions
precedent to closing set forth in this Agreement and Seller’s performance of its
obligations under this Agreement.
7.1.4     Ground Lessor Estoppels. On or before the date which is two (2)
business days prior to the Closing Date (the “Ground Lessor Estoppel Delivery
Date”), Seller shall have delivered to Buyer estoppel certificates substantially
in the form of Exhibits “I-1” and “I-2” hereto (such certificates, the “Ground
Lessor Estoppel Certificates”; such delivery requirement, the “Ground Lessor
Estoppel Delivery Requirement”); provided, however, that if Seller has not
obtained the Ground Lessor Estoppel Certificates by the Ground Lessor Estoppel
Delivery Date, Seller may, at its election, extend the Closing Date for thirty
(30) days to try to obtain such Ground Lessor Estoppel Certificates. Such Ground
Lessor Estoppel Certificates shall be consistent with the Ground Lease, shall
not reveal any default by any party thereto, shall be dated no earlier than
thirty (30) days prior to Closing, and shall be otherwise reasonably acceptable
to Buyer (provided that a form(s) without material deviations from the forms
attached hereto as Exhibits “I-1” and “I-2” and which does not disclose any
material adverse facts or information inconsistent with the Ground Lease that
has not previously been disclosed in writing to Buyer prior to the delivery of
the Ground Lessor Estoppel Certificates shall be deemed acceptable). If Seller
has not satisfied the Ground Lessor Estoppel Delivery Requirement by the Ground
Lessor Estoppel Delivery Date, as may be extended, Buyer may elect, by providing
Seller its written notice of such election, to (i) terminate the Agreement
pursuant to Paragraph 7.3, or (ii) waive such condition and proceed to the
Closing. In the event that Buyer terminates the Agreement due to a failure of
this condition precedent, Buyer shall be entitled to receive from Seller
reimbursement of Buyer’s actually incurred out of pocket expenses incurred in
connection with pursuing the transactions contemplated by this Agreement,
including without limitation Buyer’s attorneys’ fees (not to exceed $100,000).
For the avoidance of doubt, the foregoing reimbursement obligation shall survive
any termination of this Agreement.
7.1.5     Tenant Estoppel Certificates. On or before the date which is two (2)
business days prior to the Closing Date (the “Estoppel Delivery Date”), Seller
shall have delivered to Buyer an Estoppel Certificate in the form of (i) for
tenants under Hospital Leases, Exhibit “D‑1” attached hereto, (ii) for tenants
under other Leases, Exhibit “D‑2” attached hereto, or (iii) in either case, in
such form as is required pursuant to the applicable Lease (the “Estoppel
Certificate”) from tenants leasing no less than the Estoppel Certificate
Percentage (the “Estoppel Delivery Requirement”). No later than three (3)
Business Days prior to the date on which Seller intends to distribute the
Estoppel Certificates to the Tenants for their completion and execution, Seller
shall deliver the draft Estoppel Certificates to Buyer for Buyer’s review and
approval, which approval shall not be unreasonably withheld. If Seller is unable
to deliver timely to Buyer the appropriate number of Estoppel Certificates to
satisfy the Estoppel Delivery Requirement, Seller may, but without any
obligation to do so, deliver to Buyer prior to the Close of Escrow, in lieu of
an Estoppel Certificate executed by tenants, the necessary number of Estoppel
Certificates executed by Seller (the “Seller Estoppel”), in substantially the
form attached hereto as Exhibit “H”, in order to satisfy the Estoppel Delivery
Requirement; provided,

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however, Seller shall not be permitted to deliver (i) Seller Estoppels with
respect to any Hospital Leases, or (ii) Seller Estoppels for more than twenty
percent (20%) of the other leased rentable square footage of the Building(s).
The Seller Estoppels executed by Seller shall be subject to the limitations
contained in Sections 13 and 20.3, and shall be deemed automatically null and
void upon the delivery of an Estoppel Certificate from the tenant for whom
Seller delivered a Seller Estoppel. Such Estoppel Certificates shall be
consistent with the respective Lease, shall not reveal any default by Seller
and/or Tenant, any right to offset rent by the Tenant, or any claim of the same,
be dated no earlier than thirty (30) days prior to Closing and shall be
otherwise reasonably acceptable to Buyer provided, however, notwithstanding the
foregoing or anything to the contrary set forth in this Agreement, Buyer may
only disapprove an executed Estoppel Certificate if it (a) discloses material
adverse economic terms of the applicable lease that were not disclosed to Buyer
in writing (whether in the applicable lease or any other document delivered to
Buyer) prior to the date of the delivery of such Estoppel Certificate to Buyer,
(b) alleges a default of Seller (as landlord) under the applicable lease, (c)
discloses a dispute between the landlord and a tenant in connection with the
applicable Lease, (d) discloses facts that would constitute a default by Tenant
under the applicable lease, (e) discloses terms or information that is
inconsistent with the terms of the applicable lease, or (f) discloses other oral
or written agreements to which Seller and Tenant are parties or are otherwise
bound, which agreements were not disclosed to Buyer in writing (whether in the
applicable lease or any other document delivered to Buyer) prior to the date of
the delivery of such Estoppel Certificate to Buyer; otherwise, the applicable
Estoppel Certificate (or Seller Estoppel, as applicable) shall be deemed
acceptable to and approved by Buyer. Buyer shall have three (3) Business Days
after receipt of each such executed Estoppel Certificate to approve or
reasonably disapprove the applicable Estoppel Certificate so received.
Notwithstanding the foregoing, if Seller has not satisfied the Estoppel Delivery
Requirement by the Estoppel Delivery Date, Seller shall have the right, by
delivering written notice to Buyer prior to 5:00 p.m. Pacific time, on the
Estoppel Delivery Date, to extend the Estoppel Delivery Date for up to thirty
(30) days in order to obtain sufficient estoppel certificates to satisfy the
Estoppel Delivery Requirement prior to the Closing Date. If as a result of such
extension, the Estoppel Delivery Date would be a date later than the Closing
Date, the Closing Date shall also be extended to be the date which is five (5)
Business Days following the extended Estoppel Delivery Date. In the event Seller
is unable to obtain Estoppel Certificates (or Seller Estoppels, if applicable)
sufficient to satisfy the Estoppel Delivery Requirement by the Estoppel Delivery
Date (as it may be extended by Seller as provided above), Buyer may elect to
(i) terminate the Agreement and Escrow pursuant to Paragraph 7.3 below, or
(ii) waive such condition and proceed to the Closing.
7.1.6     Representations, Warranties and Covenants of Seller. Seller shall have
duly performed each and every agreement to be performed by Seller hereunder and
Seller’s representations, warranties and covenants set forth in this Agreement
shall be true and correct in all material respects as of the date hereof and,
subject to any Representation Matters, as of the Closing Date, with the same
force and effect as if remade by Seller in a separate certificate at that time.
7.1.7     Seller’s Deliveries. Seller shall have delivered the items described
in Paragraph 7.1, Paragraph 8.1 and Paragraph 9.

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7.1.8     Title Insurance. As of the Close of Escrow, the Title Company shall
have issued or shall have committed to issue the Title Policy to Buyer.
7.1.9     Declaration/Utility Agreement Estoppel. On or before the date which is
two (2) business days prior to the Closing Date (the “Declaration/Utility
Agreement Estoppel Delivery Date”), Seller shall have delivered to Buyer an
estoppel certificate substantially in the form of Exhibit “J” hereto (such
certificate, the “Declaration/Utility Agreement Estoppel Certificate”; such
delivery requirement, the “Declaration/Utility Agreement Estoppel Delivery
Requirement”); provided, however, that if Seller has not obtained the
Declaration/Utility Agreement Estoppel Certificate by the Declaration/Utility
Agreement Delivery Date, Seller may, at its election, extend the Closing Date
for thirty (30) days to try to obtain such Declaration/Utility Agreement
Estoppel Certificate. Such Declaration/Utility Agreement Estoppel Certificate
shall not reveal any default by any party thereto, shall be dated no earlier
than thirty (30) days prior to Closing, and shall be otherwise reasonably
acceptable to Buyer (provided that a form without material deviations from the
form attached hereto as Exhibit “J” and which does not disclose any material
adverse facts or information that has not previously been disclosed in writing
to Buyer prior to the delivery of the Declaration/Utility Agreement Estoppel
Certificate shall be deemed acceptable). If Seller has not satisfied the
Declaration/Utility Agreement Estoppel Delivery Requirement by the
Declaration/Utility Agreement Estoppel Delivery Date, as may be extended, Buyer
may elect, by providing Seller its written notice of such election, to
(i) terminate the Agreement pursuant to Paragraph 7.3, or (ii) waive such
condition and proceed to the Closing. In the event that Buyer terminates the
Agreement due to a failure of this condition precedent, Buyer shall be entitled
to receive from Seller reimbursement of Buyer’s actually incurred out of pocket
expenses incurred in connection with pursuing the transactions contemplated by
this Agreement, including without limitation Buyer’s attorneys’ fees (not to
exceed $100,000). For the avoidance of doubt, the foregoing reimbursement
obligation shall survive any termination of this Agreement.
The conditions set forth in Paragraph 7.1 are solely for the benefit of Buyer
and may be waived only by Buyer in writing to Seller. Buyer shall at all times
have the right to waive any condition under this Paragraph 7.1. Any such waiver
or waivers shall be in writing and shall be delivered to Seller and Escrow
Holder. All approvals or disapprovals given by Buyer under this Paragraph 7.1
shall be in Buyer’s sole and absolute discretion (for any reason or no reason at
all) and in writing and the failure of Buyer to approve any matter requiring its
approval under this Paragraph 7.1 by the time therefor shall be deemed
disapproval thereof by Buyer.
7.2     Conditions Precedent to Seller’s Obligations. The Close of Escrow and
Seller’s obligations with respect to the transaction contemplated by this
Agreement are subject to (a) Buyer’s delivery to Escrow Holder on or before the
Closing Date, for disbursement as provided herein, of the Purchase Price, and
the documents and materials described in Paragraph 8.2, (b) all representations
and warranties of Buyer contained in Paragraph 15 of this Agreement being true
and correct in all material respects as of the date made and as of the Close of
Escrow with the same effect as if those representations and warranties were made
at and as of the Close of Escrow, and (c) Buyer not being in material default in
the performance of any material covenant or agreement to be performed by Buyer
under this Agreement.

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The conditions set forth in this Paragraph 7.2 are solely for the benefit of
Seller and may be waived only by Seller in writing to Buyer. Seller shall at all
times have the right to waive any condition under this Paragraph 7.2. Any such
waiver or waivers shall be in writing and shall be delivered to Buyer and Escrow
Holder.
7.3     Failure of Conditions to Close of Escrow. In the event any of the
conditions set forth in Paragraph 7.1 or Paragraph 7.2 are not timely satisfied
or waived as aforesaid in Paragraph 7.1 or 7.2, as applicable, for a reason
other than the default of Buyer or Seller under this Agreement:
7.3.1     This Agreement, the Escrow and the rights and obligations of Buyer and
Seller shall terminate, except as otherwise provided herein; and
7.3.2     Escrow Holder is hereby instructed to promptly return to Seller and
Buyer all funds and documents deposited by them, respectively, into Escrow which
are held by Escrow Holder on the date of said termination (less, in the case of
the party otherwise entitled to such funds, however, the amount of any
cancellation charges required to be paid by such party under Paragraph 7.3.3).
No notice to Escrow Holder from Seller shall be required for the release of the
Deposit to Buyer by Escrow Holder in the event of a termination by Buyer
pursuant to Paragraphs 7.1.1, 7.1.2, or 7.1.3 above, and the Deposit shall be
released and delivered to Buyer upon Escrow Holder’s receipt of Buyer’s
confirmation of termination of the Agreement pursuant to Paragraphs 7.1.1,
7.1.2, or 7.1.3 above, despite any objection or potential objection by Seller.
7.3.3     Cancellation Fees and Expenses. In the event the Escrow terminates
because of the nonsatisfaction of any condition precedent for a reason other
than the default of Buyer or Seller under this Agreement, the cancellation
charges required to be paid by and to Escrow Holder and the Title Company shall
be borne one-half (½) by Seller and one-half (½) by Buyer and all other charges
shall be borne by the party incurring same.
8.     Deliveries to Escrow Holder.
8.1     By Seller. Seller hereby covenants and agrees to deliver or cause to be
delivered to Escrow Holder on or before the Closing Date the following
instruments and documents, the delivery of each of which shall be a condition
precedent to the Close of Escrow for the benefit of Buyer.
8.1.1     Ground Lease Assignment. Seller shall deliver to Escrow Holder one (1)
original of an assignment of the Ground Lease (the “Ground Lease Assignment”),
duly executed by Seller. The Ground Lease Assignment shall be in the form of,
and upon the terms contained in Exhibit “B” attached hereto.
8.1.2     General Assignment and Bill of Sale. Seller shall deliver to Escrow
Holder one (1) original of the General Assignment and Bill of Sale (“General
Assignment”), duly executed by Seller, assigning to Buyer, to the extent
assignable, all of Seller’s right, title and interest in and to all Leases,
Service Contracts, Licenses and Permits, Records and Plans and Warranties. The
General Assignment shall be in the form of, and upon the terms contained in,
Exhibit “C” attached hereto.

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8.1.3     Memorandum of Ground Lease Assignment. Seller shall deliver to Escrow
Holder an executed and acknowledged Memorandum of Ground Lease Assignment (the
“Memorandum of Ground Lease Assignment”). The Memorandum of Ground Lease
Assignment shall be in the form of that attached hereto as Exhibit “E”.
8.1.4     Non-Foreign Certification. Seller shall deliver to Escrow Holder a
certification duly executed by Seller under penalty of perjury in the form of,
and upon the terms set forth in, the Transferor’s Certification of Non-Foreign
Status attached hereto as Exhibit “F” (“FIRPTA Certificate”), setting forth
Seller’s address and federal tax identification number and certifying that
Seller is a “United States Person” and that Seller is not a “foreign person” in
accordance with and/or for the purpose of the provisions of Sections 7701 and
1445 (as may be amended) of the Internal Revenue Code of 1986, as amended, and
any regulations promulgated thereunder.
8.1.5     Proof of Authority. Seller shall deliver to Escrow Holder such proof
of Seller’s authority and authorization to enter into this Agreement and
consummate the transaction contemplated hereby, and such proof of the power and
authority of the individual(s) executing and/or delivering any instruments,
documents or certificates on behalf of Seller to act for and bind Seller as may
be reasonably required by Title Company and/or Buyer.
8.1.6     Title Affidavits. Seller shall deliver to Escrow Holder (i) an
affidavit to Title Company by Seller that there are no unrecorded easements and
that Seller has exclusive possession of the Property, subject to Leases and
Approved Title Conditions, in a commercially reasonable form so as to delete the
standard exceptions relating to such matters in the Title Policy; and (ii) a gap
affidavit and indemnification agreement by Seller in commercially reasonable
form for purpose of deleting the “gap” from the Title Policy.
8.1.7     Tenant Notification Letter. Seller shall deliver to Escrow Holder a
letter to the Tenants (“Tenant Notification Letter”), duly executed by Seller
and dated as of the Close of Escrow, notifying each Tenant that: (A) the
Property has been transferred to Buyer; (B) all of Seller’s right, title and
interest in and to the Leases have been assigned to Buyer; and (C) commencing
immediately, all rent and other payments and any notices under the Leases are to
be paid and sent to Buyer. The form and content of the Tenant Notification
Letter shall be satisfactory to Buyer in its reasonable discretion.
8.1.8     Deed. A Grant, Bargain and Sale Deed (the “Deed”) in the form of
Exhibit “G” attached hereto, duly executed and acknowledged in recordable form
by Seller, conveying Seller’s interest in the Improvements to Buyer.
8.1.9     Closing Statement. Seller’s executed counterpart of a closing
statement reflecting adjustments and prorations to be made at Closing (the
“Closing Statement”).
8.2     By Buyer. Buyer hereby covenants and agrees to deliver or cause to be
delivered to Escrow Holder upon or prior to the Closing Date the following
instruments and documents, the delivery of each of which shall be a condition
precedent to the Close of Escrow for the benefit of Seller.

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8.2.1     Purchase Price. Buyer shall deliver to Escrow Holder the Purchase
Price in accordance with Paragraphs 3 and 4.
8.2.2     Documents. Buyer shall deliver to Escrow Holder one (1) original of
each of the Ground Lease Assignment and the General Assignment duly executed by
Buyer and one (1) original of the Memorandum of Ground Lease Assignment executed
and acknowledged by Buyer.
8.2.3     Proof of Authority. Buyer shall deliver to Escrow Holder such proof of
Buyer’s authority and authorization to enter into this Agreement and consummate
the transaction contemplated hereby, and such proof of the power and authority
of the individual(s) executing and/or delivering any instruments, documents or
certificates on behalf of Buyer to act for and bind Buyer as may be reasonably
required by Title Company and/or Seller.
8.2.4     Prorations. Buyer shall deliver to Escrow Holder the amount due to
Seller, if any, after the prorations are computed in accordance with
Paragraph 11.
8.2.5     Closing Statement. Buyer’s executed counterpart of the Closing
Statement.
9.     Deliveries to Buyer Upon Close of Escrow. Seller shall deliver possession
of the Property to Buyer upon the Close of Escrow (unless otherwise provided).
Further, Seller hereby covenants and agrees to deliver to Buyer, on or prior to
the Closing Date, the following items (to the extent in Seller’s possession or
within Seller’s reasonable control), the delivery of each of which shall be a
condition to the performance by Buyer of its obligations under the terms of this
Agreement:
9.1     Leases. Seller shall deliver to Buyer originals of all the Leases or, to
the extent an original Lease is unavailable, a duplicate original thereof with a
certificate executed by Seller warranting the completeness and authenticity of
such duplicate original;
9.2     Rent Roll. Seller shall deliver to Buyer the Rent Roll, updated as of
the Closing Date;
9.3     Service Contracts. Seller shall deliver to Buyer originals of all
Service Contracts, or, to the extent an original Service Contract is
unavailable, a duplicate original thereof;
9.4     Records, Plans and Warranties. Seller shall deliver to Buyer originals,
to the extent available, or copies of the Records, Plans and Warranties.
9.5     Licenses and Permits. Seller shall deliver to Buyer originals of all
Licenses and Permits or, to the extent an original of a License or Permit is
unavailable, a duplicate original thereof; and
10.     Costs and Expenses. If the transaction contemplated by this Agreement is
consummated, then upon the Closing Seller shall pay (A) the premium for the
standard coverage portion of the Title Policy and the cost of any endorsements
issued to cure a title objection that

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Seller elected to cure in Seller’s Title Notice, (B) one‑half (½) of all escrow
fees and costs, (C) all costs related to the release of disapproved title
matters pursuant to Paragraph 7.1.1 above, (D) all real property transfer taxes
(also known as RPTT), and (E) Seller’s share of prorations. If the transaction
contemplated by this Agreement is consummated, then upon the Closing Buyer shall
pay (W) the incremental additional premium (if any) for the extended coverage
portion of the Title Policy and the cost of any endorsements to the extent in
excess of the premium set forth in (A) above, (X) all document recording
charges, (Y) one‑half (½) of all escrow fees and costs, and (z)  Buyer’s share
of prorations. Buyer and Seller shall each pay their own legal and professional
fees. All other costs and expenses shall be allocated between Buyer and Seller
in accordance with the customary practice in the County.
11.     Prorations. All revenues and expenses relating to the Property,
including without limitation, real property taxes and assessments, rent payable
under the Ground Lease, utility charges and the like, shall be prorated on an
accrual basis as of the Close of Escrow; provided, however, rentals shall be
prorated on a cash received basis. Such proration shall be made as of 12:01 a.m.
midnight (Pacific time) on the Closing Date (the “Proration Time”). If any rents
under any of the leases for space at the Property shall be accrued and unpaid at
the Closing Date, the rents collected by Buyer on or after the Closing Date
shall first be applied to rents due at the time of such collection on or after
the Closing Date, with the balance payable to the Seller to the extent of rents
delinquent as of the Closing Date; provided that Buyer shall use commercially
reasonable diligent efforts to collect any delinquent rents, but shall not be
required to institute any proceeding or incur any material out-of-pocket costs
to collect any rents accrued and unpaid on the Closing Date. Seller, at its sole
cost, shall be entitled to bring such actions or proceedings against tenants
provided that such actions do not affect such tenant’s possession. To the extent
that Tenants are reimbursing the landlord for common area maintenance and other
operating expenses (collectively, “CAM Charge(s)”), CAM Charges shall be
prorated at Closing as of the Proration Time on a lease-by-lease basis with each
party being entitled to receive a portion of the CAM Charges payable under each
Lease for the CAM Lease Year (as defined below) in which Closing occurs, which
portion shall be equal to the actual CAM Charges incurred during the party’s
respective periods of ownership of the Property during the CAM Lease Year. As
used herein, the term “CAM Lease Year” means the twelve (12) month period as to
which annual CAM Charges are owed under each Lease. Seller shall be responsible
for the CAM Charges reconciliation on a lease-by-lease basis for their ownership
period within the CAM Lease Year up to, but not including, the Closing Date.
Buyer shall be responsible for the CAM Charges reconciliation on a
lease-by-lease basis for their ownership period within the CAM Lease Year
including the Closing Date. In the event of any expenses, i.e. property taxes,
where a proration was based upon an estimate for the year of Closing, a
post-Closing “true up” will be performed for the actual expense to determine the
Seller and Buyer obligation for their ownership period for the year of Closing.
Each party will be responsible to pay for any CAM Charges “true up” necessary to
the extent that any Lease provides for a “true up”, which payment shall be based
on such party’s period of ownership. Seller shall pay over to or credit Buyer at
Closing all cash security deposits (together with any interest required to be
paid thereon) held by Seller pursuant to the leases of tenants at the Property.
Buyer shall receive a credit at Closing from the Seller in the amount of the sum
of: (i) any and all rent concessions and/or rent abatements which related to the
current lease term of the Leases that exist as of the date hereof and are
unpaid, unapplied and/or unutilized; (ii) any and all tenant improvement
allowances which relate to the current lease term of the Leases that exist as of
the date hereof and are unpaid, unapplied and/or

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unutilized; (iii) the cost, as estimated by the parties in their reasonable
discretion, of any and all non-monetary tenant inducement obligations of the
Seller, as landlord or lessor under the Leases that exist as of the date hereof,
which relate to the current lease term of the Leases that exist as of the date
hereof (e.g., painting and carpeting) and are unperformed; and (iv) any and all
leasing commissions which relate to the current lease term of the Leases that
exist as of the date hereof and are unpaid. Notwithstanding the foregoing, all
tenant improvement costs and allowances and all brokerage commissions and
finder’s fees shall be prorated with respect to all leases and lease
modifications entered into between the Execution Date and the Closing Date based
on the portion of the lease term that pertains to periods on or after the
Closing, with Seller only being responsible for such costs multiplied by a
fraction, the numerator of which is the number of days prior to the Closing that
Seller has received rent from such tenant under the new lease or lease
modification and the denominator of which is the total number of days in such
new lease term, and Buyer being solely responsible for the balance of such
costs. If the parties are unable to obtain final meter readings from all
applicable meters as of the Close of Escrow, such expenses shall be reasonably
estimated as of the Close of Escrow on the basis of the prior operating history
of the Property. Real property taxes for the year of Closing shall be prorated
on the basis of the most recent assessment and levy. If the most recent tax
assessment and levy is not for the current tax year, then the parties shall
reprorate within sixty (60) days of the receipt of the tax assessment and levy
for the current tax year. If after the Closing there is any retroactive increase
or decrease in the real or personal property taxes or assessments (not caused by
Buyer’s acquisition of the Property) imposed on the Property: (1) if such
increase or decrease relates to the tax year in which the Closing occurred, then
such increase or decrease shall be prorated by Seller and Buyer on a per diem
basis based on their respective periods of ownership during their period to
which such increase applies, (2) if such increase or decrease relates to any tax
year subsequent to the tax year which the Closing occurred, then such increase
or decrease shall be for the benefit of or be the obligation of Buyer, as
appropriate, and (3) if such increase or decrease relates to any tax year prior
to the tax year in which the Closing occurred, then such increase or decrease
shall be for the benefit of or be the obligation of Seller, as appropriate. Any
and all refunds, credits, claims or rights to appeal respecting the amount of
any real property taxes or other taxes or assessments charged in connection with
the Property for any period after Closing shall belong to Buyer following the
Closing, except that Seller shall be entitled to receive any refunds applicable
to the period prior to Closing to the extent that Seller initiated a contest
prior to Closing. All monthly prorations shall be calculated on actual days of
the applicable month and all annual prorations shall be calculated based on a
365‑day year. Not less than five (5) business days prior to the Close of Escrow,
Seller and Buyer shall agree upon a schedule of expenses and prorations
(“Proration and Expense Schedule”). If any prorations, apportionments or
computations made under this Paragraph 11 shall require final adjustment because
the information is unavailable at the Proration Time, then the parties shall
make the appropriate adjustments promptly when accurate information becomes
available and either party hereto shall be entitled to an adjustment to correct
the same. Such adjustments shall be made as soon as complete and accurate
information becomes available, but in all events no later than 180 days after
the Closing, except with respect to CAM Charges, taxes and assessments, in which
case such adjustment shall be made within sixty (60) days after the information
necessary to perform such adjustment is available. If a party fails to request
an adjustment to the Closing Statement by a written notice delivered to the
other party within the applicable period set forth above (such notice to specify
in reasonable detail the items within the Closing Statement that

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such party desires to adjust and the reasons for such adjustment), then the
prorations and credits set forth in the Closing Statement shall be binding and
conclusive against such party. Any corrected adjustment or proration shall be
paid promptly by check or other settlement such as a wire transfer to the party
entitled thereto. The obligations of the parties under this Paragraph 11 shall
survive the Close of Escrow until the date that is ninety (90) days after the
end of the calendar year in which Closing occurs and shall not merge with the
Deed.
12.     Disbursements and Other Actions by Escrow Holder. At the Close of
Escrow, Escrow Holder shall promptly undertake all of the following in the
manner hereinbelow indicated.
12.1     Recording. Escrow Holder shall cause the Deed, Memorandum of Ground
Lease Assignment and any other documents which the parties hereto may mutually
direct to be recorded in the Official Records and obtain conformed copies
thereof for distribution to Buyer and Seller.
12.2     Funds. Escrow Holder shall disburse all funds deposited with Escrow
Holder by Buyer in payment of the Purchase Price in accordance with the Closing
Statement, which will reflect that the Escrow Holder shall:
12.2.1     Deduct from the Purchase Price all items chargeable to the account of
Seller pursuant to Paragraph 11;
12.2.2     If, as the result of the prorations and credits pursuant to
Paragraph 11, amounts are to be charged to account of Seller, deduct from the
Purchase Price the total amount of such charges;
12.2.3     Disburse the balance of the Purchase Price to Seller promptly upon
the Close of Escrow; and
12.2.4     Disburse the remaining balance of the funds, if any, to Buyer
promptly upon the Close of Escrow.
12.3     Title Policy. Escrow Holder shall direct the Title Company to issue the
Title Policy to Buyer.
12.4     Disbursement of Documents to Buyer. Escrow Holder shall disburse to
Buyer a conformed copy of the Deed and Memorandum of Ground Lease, and an
original of the General Lease Assignment, the General Assignment, the FIRPTA
Certificate and any other documents (or copies thereof) deposited into Escrow by
Seller pursuant hereto.
12.5     Disbursement of Documents to Seller. Escrow Holder shall disburse to
Seller a conformed copy of the Deed and Memorandum of Ground Lease Assignment,
and copies of the Ground Lease Assignment and General Assignment.
13.     Seller’s Representations and Warranties. In addition to any express
agreements of Seller contained herein, the following constitute representations
and warranties of Seller to Buyer:

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13.1     Power. Seller has the legal power, right and authority to enter into
this Agreement and the instruments referenced herein, and to consummate the
transaction contemplated by this Agreement.
13.2     Requisite Action. All requisite action (corporate, trust, partnership
or otherwise) has been taken by Seller in connection with entering into this
Agreement, the instruments referenced herein, and the consummation of the
transaction contemplated by this Agreement. No consent of any partner,
shareholder, trustee, trustor, beneficiary, creditor, investor, judicial or
administrative body, governmental authority or other party is required for
Seller to consummate the transaction contemplated by this Agreement.
13.3     Individual Authority. The individuals executing this Agreement and the
instruments referenced herein on behalf of Seller and the partners of Seller, if
any, have the legal power, right, and actual authority to bind Seller to the
terms and conditions hereof and thereof.
13.4     No Conflict. Neither the execution and delivery of this Agreement and
the documents and instruments referenced herein, nor the occurrence of the
obligations set forth herein, nor the consummation of the transaction
contemplated herein, nor compliance with the terms of this Agreement and the
documents and instruments referenced herein conflict with or result in the
breach of any terms, conditions or provisions of, or constitute a default under,
any bond, note, or other evidence of indebtedness or any contract, indenture,
mortgage, deed of trust, loan, partnership agreement, lease or other agreement
or instrument to which Seller is a party or affecting the Property.
13.5     Bankruptcy. Seller 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.
13.6     No Notice of Code Violations. To Seller’s knowledge, Seller has not
received any written notice from any governmental agency that the Property or
any condition existing thereon or any present use thereof violates any law or
regulations applicable to the Property.
13.7     No Litigation. There is no litigation, arbitration, condemnation
proceeding, or other legal or administrative suit, action, proceeding or
investigation of any kind pending or, to Seller’s knowledge, threatened against
or involving Seller or the Property or any part thereof.
13.8     No Rights of First Refusal. There are no outstanding rights of first
refusal, rights of reverter, or options to purchase relating to the Property or
any interest therein, except as set forth in the Ground Lease.
13.9     Prohibited Persons and Transactions. Neither Seller nor any of its
affiliates, nor, to Seller’s knowledge, any of their respective members, and
none of their

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respective officers or directors is, nor prior to Closing or the earlier
termination of this Agreement, will they become, a person or entity with whom
U.S. persons or entities are restricted from doing business under regulations of
the Office of Foreign Asset Control (“OFAC”) of the Department of the Treasury
(including those named on OFAC’s Specially Designated Blocked Persons List) or
under any U.S. statute, executive order (including the September 24, 2001,
Executive Order Blocking Property and Prohibiting Transactions with Persons Who
Commit, Threaten to Commit or Support Terrorism) or other governmental action
and is not and prior to Closing or the earlier termination of this Agreement
will not knowingly engage in any dealings or transactions with or be otherwise
associated with such persons or entities.
13.10     Agreements with Governmental Agencies. Seller has not entered into any
material commitments or agreements with any governmental authorities or agencies
affecting the Property that would be binding on the Property or Buyer following
Closing.
13.11     Leases. Seller has delivered or made available to Buyer true and
complete copies of the Leases. The Rent Roll set forth on Schedule 13.11
attached hereto is true, correct and complete in all material respects. To the
best of Seller’s knowledge, each of the Leases is in full force and effect.
Seller is “landlord” or “lessor” under the Leases and is entitled to assign to
Buyer, without the consent of any party, the Leases. To the best of Seller’s
knowledge, except as otherwise disclosed to Buyer in writing, neither Seller nor
any Tenant is in default under its respective Lease, after the expiration of all
applicable notice and cure periods, and no notice of default has been given by
either Seller or Tenant under any Lease which remains uncured. To the best of
Seller’s knowledge, except as otherwise disclosed to Buyer in writing, no tenant
has asserted any claim of offset or other defense in respect of its or Seller’s
obligations under its respective Lease. To the best of Seller’s knowledge,
except as otherwise disclosed to Buyer in writing, no tenant has filed for
bankruptcy or taken any similar debtor-protection measure, or discontinued
operations at the Property (except as otherwise permitted by the Hospital Lease
for “Flex Space”). There are no tenant improvement allowances, non-monetary
tenant improvement obligations of Landlord, leasing commissions and/or rent
concessions with respect to the current term of any Tenant Lease, except as
disclosed on Schedule 13.11 attached hereto or as otherwise set forth in any
estoppel certificate delivered to Buyer.
13.12     Declarations. Seller has not received any written notice from, and, to
the best of Seller’s knowledge, there are no grounds for, any declarant or
easement holder requiring the correction of any condition with respect to the
Property, or any part thereof, by reason of a violation of any other
restrictions or covenants recorded against the Property.
13.13     Hazardous Materials. To Seller’s knowledge, except as disclosed in the
Materials, Seller has not received written notice from any governmental
authority of any violation of any laws, ordinances, statutes, codes, rules or
regulations relating to Hazardous Materials (as defined below). For purposes of
this Agreement, the term “Hazardous Materials” shall mean any substance which is
or contains: (i) any “hazardous substance” as now or hereafter defined in
Section 101(14) of the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended (42 U.S.C. Section 9601 et seq.) (“CERCLA”) or
any regulations promulgated under CERCLA; (ii) any “hazardous waste” as now or
hereafter defined in the Recourse Conservation and Recovery Act (42 U.S.C.

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Section 6901 et seq.) (“RCRA”) or regulations promulgated under RCRA; (iii) any
substance regulated by the Toxic Substances Control Act (15 U.S.C. Section 2601
et. seq.); (iv) gasoline, diesel fuel or other petroleum hydrocarbons;
(v) asbestos and asbestos containing materials, in any form, whether friable or
non-friable; (vi) polychlorinated biphenyls; (vii) radon gas: and (viii) any
additional substances or materials which are now or hereafter classified or
considered to be hazardous or toxic under any laws, ordinances, statutes, codes,
rules, regulations, agreements, judgments, orders and decrees now or hereafter
enacted, promulgated, or amended, of the United States, the state, the county,
the city or any other political subdivision in which the Property is located and
any other political subdivision, agency or instrumentality exercising
jurisdiction over the owner of the Property, the Property or the use of the
Property relating to pollution, the protection or regulation of human health,
natural resources or the environment, or the emission, discharge, release or
threatened release of pollutants, contaminants, chemicals or industrial, toxic
or hazardous substances or waste into the environment (including, without
limitation, ambient air, surface water, ground water or land or soil).
13.14     Ground Lease. Seller has delivered to Buyer a true and complete copy
of the Ground Lease; the Ground Lease has not been amended or modified; and to
the best of Seller’s knowledge, the Ground Lease is in full force and effect. To
the best of Seller’s knowledge, except as otherwise disclosed to Buyer in
writing, neither Seller nor Ground Lessor is in default under the Ground Lease,
after the expiration of all applicable notice and cure periods, and no notice of
default has been given by either Seller or Ground Lessor under the Ground Lease
which remains uncured. To the best of Seller’s knowledge, except as otherwise
disclosed to Buyer in writing, Ground Lessor has asserted no claim of offset or
other defense in respect of its or Seller’s obligations under the Ground Lease.
To the best of Seller’s knowledge, except as otherwise disclosed to Buyer in
writing, Ground Lessor has not filed for bankruptcy or taken any similar
debtor-protection measure. Seller has complied with the requirements set forth
in Sections 14.2 and 14.8 of the Ground Lease as they pertain to the
transactions contemplated by this Agreement.
13.15     Affiliated Tenants. Seller is not affiliated with any of the Tenants.
13.16     Materials. The copies of the Materials described as items 7, 8, 11,
12, 13 and 19 in Schedule 7.1.2 given by Seller to Buyer are accurate in all
material respects and are complete copies of those used in the ordinary course
of Seller’s business.
The representations and warranties of Seller set forth in this Paragraph 13
shall survive the Close of Escrow for a period of nine (9) months, but not
thereafter, it being the intention of the parties that all suits or actions for
breach of any such representations and warranties must be commenced, if at all,
within said nine (9) months of the Close of Escrow or they shall be forever
barred. Notwithstanding the foregoing, if, prior to the Closing Date, Buyer or
Seller should learn, discover or become aware of any existing or new item, fact
or circumstance which renders a representation or warranty of Seller set forth
herein incorrect or untrue in any material respect (collectively, the
“Representation Matter”), then the party who has learned, discovered or become
aware of such Representation Matter shall promptly give written notice thereof
to the other party and Seller’s representations and warranties shall be
automatically limited to account for the Representation Matter. If, prior to the
Closing Date, Buyer discovers or is notified of a Representation Matter that
renders any representation or warranty of Seller materially untrue or

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inaccurate, then Buyer shall have the right, as its sole remedy to terminate
this Agreement and obtain a refund of the Deposit by providing written notice
thereof to Seller no later than five (5) business days after Buyer learns or is
notified of such Representation Matter; provided, however, Buyer shall have no
right to terminate this Agreement for any Representation Matter arising from a
change in circumstances that is otherwise permitted under this Agreement.
Notwithstanding the foregoing, (i) if any Tenant is estopped from making a claim
against Buyer due to its delivery of an Estoppel Certificate to Buyer in
connection with this transaction, then Buyer agrees to first assert a defense
against such Tenant based on said estoppel before pursuing a claim against
Seller for breach of any representation or warranty made by Seller hereunder
which is discovered post‑Closing and relates to such estopped matter, and (ii)
if such inaccuracy is due to a willful or intentional act by Seller or a breach
by Seller of its covenants set forth in this Agreement, Buyer shall have the
default remedies set forth in Paragraph 20.1 below. Upon such termination,
neither party hereunder shall have any further obligations or liabilities under
this Agreement except as specifically set forth herein. If Buyer does not timely
terminate this Agreement, then Seller’s representations and warranties shall be
automatically limited to account for the Representation Matter, Buyer shall be
deemed to have waived Buyer’s right to pursue any remedy for breach of the
representation or warranty made untrue on account of such Representation Matter,
and the parties shall proceed to the Close of Escrow.
14.     Seller Covenants Prior to Closing.
14.1     New Leases; Ground Lease. Seller hereby agrees that, (A) until the
expiration of the Contingency Period or earlier termination of this Agreement in
accordance with the terms hereof, Seller will not modify, extend, consent to any
assignment, sublease or termination, or otherwise change any of the terms,
covenants or conditions of the Leases or enter into new Leases affecting the
Property without the prior written consent of Buyer, which consent shall not be
unreasonably withheld (in the event Buyer has not responded to Seller’s written
request for consent within three (3) Business Days after Seller’s delivery to
Buyer of all pertinent information concerning such lease, obligation or
agreement, Buyer shall be deemed to have consented thereto); provided that Buyer
will not be permitted to withhold such consent unless such modification or
change materially and adversely affects the term of the Lease or the economics
of the Lease, or, in the case of an assignment, is an assignment to an entity
that is not as creditworthy as the current Tenant, (B) following the expiration
of the Contingency Period until the Closing provided this Agreement has not been
terminated as provided herein, Seller will not modify, extend, consent to any
assignment, sublease or termination or otherwise change any of the terms,
covenants or conditions of the leases or enter into new leases affecting the
Property without the prior written consent of Buyer, which consent may be
withheld in Buyer’s sole but reasonable discretion (in the event Buyer has not
responded to Seller’s written request for consent within three (3) Business Days
after Seller’s delivery to Buyer of all pertinent information concerning such
lease, obligation or agreement, Buyer shall be deemed to have consented
thereto); and (C) from the Execution Date until Closing, provided this Agreement
has not been terminated as provided herein, Seller will not modify, amend, or
otherwise change any of the terms, covenants or conditions of the Ground Lease
or any documents related to the Ground Lease, or enter into any new documents
relating to the Ground Lease, in each case, without the prior written consent of
Buyer, which may be given or withheld in Buyer’s sole and absolute discretion.
Seller shall copy Buyer on any and all material correspondence received

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from or sent to tenants regarding the Leases, and Seller shall copy Buyer on any
and all correspondence received or sent with respect to the Ground Lease.
14.2     Service Contracts. Except as otherwise provided herein, after the
Contingency Date, Seller will not extend, renew, modify or replace any of the
Service Contracts without the prior written consent of Buyer. If Buyer does not
disapprove any request of Seller regarding a Service Contract within three (3)
Business Days after Buyer’s receipt of such written request, Buyer shall be
deemed to have approved such request. Buyer shall not be required to assume any
Service Contract of Seller at Closing (other than the Service Contract with Otis
Elevator). Seller, at Seller’s sole cost and expense, shall terminate any
Service Contracts (other than the Service Contract with Otis Elevator) that
Buyer does not elect to assume, in Buyer’s sole and absolute discretion, by
written notification to Seller prior to the expiration of the Contingency
Period. Notwithstanding anything to the contrary contained herein, Seller shall
terminate, at Seller’s sole cost and expense, any and all leasing commission
agreements and management agreements affecting the Property effective on or
before the Closing.
14.3     Conducting Business. At all times prior to Closing, Seller shall
continue to (i) conduct business with respect to the Property in the same manner
in which said business has been heretofore conducted and (ii) insure the
Property substantially as it is currently insured and in any event in
commercially reasonable amounts and in accordance with the requirements of the
Ground Lease and any mortgage or deed of trust affecting the Property.
14.4     Encumbrances. At all times prior to Closing, except as otherwise
permitted pursuant to Paragraph 14.1 above, Seller shall not sell, mortgage,
pledge, encumber, hypothecate or otherwise transfer or dispose of all or any
part of the Property or any interest therein without the prior written consent
of Buyer, which may be given or withheld in Buyer’s sole and absolute
discretion; and Seller shall not consent to, approve or otherwise take any
action with respect to zoning or any other governmental rules or regulations
presently applicable to all or any part of the Property.
14.5     Monthly Operating Statements. Seller shall provide Buyer with a copy of
the monthly property level operating statement for the operation of the Property
on or before the day which is ten (10) days after the end of each month,
commencing with the month during which the Execution Date occurs and continuing
for each full calendar month thereafter until the Closing Date.
14.6     Estoppels. Seller shall use commercially reasonable efforts to obtain
the Tenant Estoppel Certificates described in Paragraph 7.1.5 above, and the
Ground Lessor Estoppel Certificate.
14.7     Ground Lease Amendment. Seller shall use commercially reasonable
efforts to obtain an executed amendment to the Ground Lease executed by Seller
and Ground Lessor on or prior to Closing, which amendment shall be in the form
provided by Buyer to Seller on or prior to the Effective Date, subject to
changes mutually agreed to by Buyer and Ground Lessor; provided that such
amendment shall not be a condition to Closing.

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15.     Buyer’s Representations and Warranties. In addition to any express
agreements of Buyer contained herein, the following constitute representations
and warranties of Buyer to Seller:
15.1     Power. Buyer has the legal power, right and authority to enter into
this Agreement and the instruments referenced herein, and to consummate the
transaction contemplated by this Agreement.
15.2     Requisite Action. All requisite action (corporate, trust, partnership
or otherwise) has been taken by Buyer in connection with entering into this
Agreement and the instruments referenced herein; and, by the Close of Escrow all
such necessary action will have been taken to authorize the consummation of the
transaction contemplated by this Agreement. By the Close of Escrow no additional
consent of any partner, shareholder, trustee, trustor, beneficiary, creditor,
investor, judicial or administrative body, governmental authority or other party
shall be required for Buyer to consummate the transaction contemplated by this
Agreement.
15.3     Individual Authority. The individuals executing this Agreement and the
instruments referenced herein on behalf of Buyer have the legal power, right,
and actual authority to bind Buyer to the terms and conditions hereof and
thereof.
15.4     No Conflict. Neither the execution and delivery of this Agreement and
the documents and instruments referenced herein, nor the occurrence of the
obligations set forth herein, nor the consummation of the transaction
contemplated herein, nor compliance with the terms of this Agreement and the
documents and instruments referenced herein conflict with or result in the
material breach of any terms, conditions or provisions of, or constitute a
default under, any bond, note, or other evidence of indebtedness or any
contract, indenture, mortgage, deed of trust, loan, partnership agreement, lease
or other agreement or instrument to which Buyer is a party.
15.5     Bankruptcy. Buyer 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.
15.6     Prohibited Persons and Transactions. Neither Buyer nor any of its
affiliates, nor, to Buyer’s knowledge, any of their respective members, and none
of their respective officers or directors is, nor prior to Closing or the
earlier termination of this Agreement, will they become, a person or entity with
whom U.S. persons or entities are restricted from doing business under
regulations of the Office of Foreign Asset Control (“OFAC”) of the Department of
the Treasury (including those named on OFAC’s Specially Designated Blocked
Persons List) or under any U.S. statute, executive order (including the
September 24, 2001, Executive Order Blocking Property and Prohibiting
Transactions with Persons Who Commit, Threaten to Commit or Support Terrorism)
or other governmental action

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and is not and prior to Closing or the earlier termination of this Agreement
will not knowingly engage in any dealings or transactions with or be otherwise
associated with such persons or entities.
Buyer’s representations and warranties made in this Paragraph 15 shall be
continuing and shall be true and correct as of the Close of Escrow with the same
force and effect as if remade by Buyer in a separate certificate at that time.
The truth and accuracy of Buyer’s representations and warranties made herein
shall constitute a condition for the benefit of Seller to the Close of Escrow
and shall survive the Closing for a period of nine (9) months.
16.     Condemnation and Destruction.
16.1     Condemnation. If at any time prior to the Closing Date any “material”
portion of the Property is condemned or taken by eminent domain proceedings by
any public authority, then at Buyer’s option, to be exercised within ten (10)
Business Days after receipt of notice of such taking, this Agreement shall
terminate, and the Deposit shall be promptly returned to Buyer, and except as
expressly set forth herein, neither party shall have any further liability or
obligation to the other hereunder. As used in this Paragraph 16.1, the term
“material” shall mean a taking which (a) materially and adversely affects the
value or operations of the Property; (b) adversely affects the value of the
Property by more than ten percent (10%) of the Purchase Price; (c) the
condemnation results in a circumstance whereby a Tenant under a Lease may
terminate its Lease or receive a rent abatement; or (d) the condemnation results
in a circumstance whereby a party can terminate the Ground Lease. Seller shall
give Buyer written notice of any taking promptly after Seller obtains knowledge
thereof. If less than a material portion of the Property is condemned or taken
by eminent domain proceedings or if Buyer does not timely notify Seller in
writing of its election to terminate this Agreement, Buyer shall be deemed to
have elected not to terminate this Agreement. If Buyer elects or is deemed to
have elected not to terminate this Agreement, the parties shall proceed to the
Closing Date without a reduction in the Purchase Price and, upon the Closing,
all condemnation proceeds paid or payable to Seller (other than losses
pertaining to periods prior to the Closing) shall belong to Buyer and shall be
paid over and assigned to Buyer. Seller shall have no obligation to make any
repairs to the Property in the event of a condemnation.
16.2     Damage and Destruction. If at any time prior to the Closing Date a
material portion of the Property is destroyed or damaged as a result of fire or
any other casualty whatsoever, then at Buyer’s option, to be exercised within
ten (10) Business Days after receipt of notice of such destruction or damage,
this Agreement shall terminate, the Deposit shall be returned to Buyer, and
except as expressly set forth herein, neither party shall have any further
liability or obligation to the other hereunder. If Buyer does not timely notify
Seller in writing of its election to terminate this Agreement, Buyer shall be
deemed to have elected not to terminate this Agreement. For purposes hereof, the
term “material” shall be deemed to be a damage or destruction (a) in excess of
ten percent (10%) of the Purchase Price; (b) the nature of the casualty results
in a circumstance whereby a Tenant under a Lease may terminate its Lease or
receive a rent abatement; or (c) the nature of the casualty results in a
circumstance whereby a party can terminate the Ground Lease. If less than a
material portion of the Property is damaged or destroyed or if a material
portion is damaged or destroyed and Buyer elects or is deemed to have elected
not to terminate this Agreement, the parties shall proceed to the Closing Date
without

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reduction in the Purchase Price and, upon the Closing, all property insurance
proceeds paid or payable to Seller as a result of such casualty shall belong to
Buyer and shall be paid over and assigned to Buyer, and Buyer shall receive a
credit from Seller for any deductible and any uninsured loss. Seller shall have
no obligation to make any repairs to the Property in the event of a damage or
destruction.
17.     Notices. Unless applicable law requires a different method of giving
notice, any and all notices, demands or other communications required or desired
to be given hereunder by any party (hereafter, the “Notice”) shall be in writing
and shall be validly given or made to another party if served personally,
delivered by carrier service, or if deposited in the United States mail,
certified or registered, postage prepaid or if transmitted by e-mail. If the
Notice is served personally, service shall be conclusively deemed made at the
time of such personal service. If the Notice is given by mail, the Notice shall
be conclusively deemed given upon receipt or refusal of delivery. If the Notice
is sent by telegraph or if by other carrier service, the Notice shall be deemed
given upon confirmation of delivery by the carrier. If the Notice is sent by
e-mail, Notice shall be deemed given immediately following transmission. Notices
delivered by e-mail must be followed by confirmation via carrier service. The
Notice shall be addressed to the party to whom such notice, demand or other
communication is to be given at the address set forth in the Basic Provisions
above. Any party hereto may change its address for the purpose of receiving
Notices as herein provided by a written Notice given in the manner aforesaid to
the other party or parties hereto.
18.     Broker. Except with respect to the Broker, which has been engaged by
Seller pursuant to a separate agreement, and shall be paid by Seller, Seller
represents and warrants to Buyer, and Buyer represents and warrants to Seller,
that no broker or finder has been engaged by it, respectively, in connection
with any of the transactions contemplated by this Agreement, or to its knowledge
is in any way connected with any of such transactions. In the event of any such
claims for brokers’ or finders’ fees or commissions in connection with the
negotiation, execution or consummation of this Agreement, then Buyer shall
indemnify, save harmless and defend Seller from and against such claims if they
shall be based upon any statement, representation or agreement made by Buyer,
and Seller shall indemnify, save harmless and defend Buyer if such claims shall
be based upon any statement, representation or agreement made by Seller.
19.    Entry. Provided that Buyer is not in default of its obligations under
this Agreement, then from and after the Opening of Escrow through the earlier of
the termination of this Agreement or the Closing Date, Buyer, its agents,
consultants, contractors and subcontractors shall have the right, at reasonable
times upon at least 48‑hours prior written notice to Seller and provided that
Buyer has coordinated with Seller so as to afford Seller a reasonable
opportunity to have a representative present at all such times, to enter upon
the Property to conduct or make any and all inspections and tests as may be
necessary or desirable, subject to the rights of any tenants or occupants of the
Property and the limitations set forth below in this Paragraph 19. The scope of
any analysis which requires physical sampling or any other invasive or intrusive
testing of all or any part of the Property shall be subject to: (a) the prior
written approval of Seller, which Seller may withhold or condition in its sole
discretion, (b) Seller’s receipt of written evidence that Buyer has procured the
insurance required pursuant to this Paragraph 19, and (c) the requirement that
Buyer dispose of all such test samples in accordance with applicable law and at
no cost or liability to Seller. Nothing herein shall

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authorize any subsurface testing or drilling on the Property by Buyer or its
environmental consultant unless specifically approved in writing by Seller,
which Seller may condition or deny in its sole discretion. Notwithstanding
anything set forth herein to the contrary, in the event that Buyer’s Phase I
environmental site assessment recommends a Phase II environmental site
assessment and Seller withholds its consent to such Phase II environmental site
assessment, and Buyer terminates this Agreement under Paragraph 7.3 above as a
result, Buyer shall be entitled to receive from Seller reimbursement of Buyer’s
actually incurred out of pocket expenses incurred in connection with pursuing
the transactions contemplated by this Agreement, including without limitation
Buyer’s attorneys’ fees. Buyer shall obtain or cause its consultants to obtain
(and provide evidence to Seller), at Buyer’s sole cost and expense, prior to
commencement of any investigative activities on the Property, a policy of
commercial general liability insurance covering any and all liability of Buyer
and Seller with respect to or arising out of any investigative activities. Such
policy of insurance shall be from an insurance company acceptable to Seller and
name Seller as an additional insured and shall be kept and maintained in force
during the term of this Agreement and so long thereafter as necessary to cover
any claims of damages suffered by persons or property resulting from any acts or
omissions of Buyer, Buyer’s employees, agents, contractors, suppliers,
consultants or other related parties. Such policy of insurance shall have
liability limits of not less than Two Million Dollars ($2,000,000.00) combined
single limit per occurrence for bodily injury, personal injury and property
damage liability.
In the event that Buyer terminates this Agreement, at Seller’s request, Buyer
hereby agrees to provide to Seller, copies of all tests, reports, studies and
the like generated by such vendor in connection with Buyer’s inspection of the
Property; provided that (i) Seller shall reimburse Buyer for all of the costs of
such third party reports and materials promptly upon receipt of such reports and
materials; (ii) such reports and materials are being delivered and made without
representation or warranty of any kind by Buyer; and (iii) Seller acknowledges
that its ability to rely on any such reports or materials may be subject to the
consent of the preparers of such reports or materials. Prior to Closing, Buyer
shall keep all documents and information received from Seller and/or its agents
and the results of all of its inspections, studies, investigations, analysis,
reports and the like confidential except as required by law and except (A) for
disclosures made to Buyer’s or its affiliates agents, consultants, attorneys,
lenders, prospective lenders, underwriters, prospective underwriters, placement
agents, prospective placement agents, and employees; (B) to the extent Buyer or
its affiliates determine, in consultation with its legal counsel, that such
disclosure is required by applicable law or is otherwise required in connection
with any filing by Buyer or its affiliates with the Securities and Exchange
Commission (the “SEC”) or any stock exchange rule applicable to Buyer or its
affiliates; and (C) to the extent Buyer or its affiliates determine, in
consultation with legal counsel, that such disclosure is required in any
prospectus, report or other filing made by Buyer or its affiliates with the SEC
or any stock exchange or in any press release, earnings release or supplemental
data related thereto; provided that any press release shall be subject to the
mutual approval of Seller and Buyer (except that so long as neither Seller’s
name nor the Purchase Price is disclosed, Buyer may reference the address of the
Property and the fact that Buyer acquired the same without Seller’s approval).
Buyer hereby indemnifies, defends and holds the Property, Seller and their
respective officers, directors, shareholders, participants, affiliates,
employers, representatives, invitees, agents and contractors free and harmless
from and against any and all actual claims, costs, losses, liabilities, damages
or expenses arising out of or resulting from such

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entry by Buyer, its agents, consultants, contractors and subcontractors.
Additionally, Buyer shall immediately, at its sole cost and expense, repair any
and all physical damage arising out of or resulting from such entry and any acts
or omissions by Buyer, its agents, employees, consultants, contractors and
subcontractors, and shall immediately, at its sole cost and expense, restore the
Property to the condition that existed immediately prior to such entry by Buyer,
its agents, employees, consultants, contractors and subcontractors. Furthermore,
prior to Closing, Buyer hereby agrees not to meet with any governmental agencies
with respect to the Property without Seller’s prior written consent, which
Seller may withhold or condition in its reasonable discretion (and, without
limiting the foregoing, Buyer agrees to give Seller a reasonable opportunity to
be present during any such meeting with any governmental agency). For
clarification, the foregoing shall not preclude Buyer or its agents or
consultants from contacting governmental agencies to obtain information
regarding zoning, permitting, violations, or other matters that are routinely
addressed in zoning, property condition, and environmental reports. In no event
shall the indemnity, repair or restoration obligations of this Paragraph 19
include the discovery of pre-existing conditions disclosed by Buyer’s
investigations. Buyer shall have the right to interview tenants of the Property
provided such are arranged through Seller’s Representative and Seller has a
reasonable opportunity to be present during each such interview. Buyer shall
keep the Property free and clear of any mechanics’ liens or materialmen’s liens
related to Buyer’s inspection and the other activities contemplated in this
Paragraph 19. This Paragraph 19 shall survive the Close of Escrow and shall not
be merged with the Deed, and shall survive the termination of this Agreement and
Escrow prior to the Close of Escrow, and shall not be limited by any provision
of this Agreement.
20.     Legal and Equitable Enforcement of this Agreement.
20.1     Default by Seller. In the event the Close of Escrow and the
consummation of the transactions herein contemplated do not occur by reason of
any default by Seller, Buyer shall, upon written notice to Seller (“Default
Notice”) be entitled to (i) terminate this Agreement, recover the Deposit, and
receive reimbursement from Seller of Buyer’s actually incurred, out of pocket
third party costs in conjunction with the Agreement (not to exceed $100,000),
after which both parties shall be released from all further obligations under
this Agreement except as otherwise provided herein and (ii) pursue the specific
performance of this Agreement, provided any action for specific performance is
commenced within ninety (90) days of delivery of the Default Notice.
Notwithstanding the foregoing, in the event that Seller’s default has resulted
in specific performance being unavailable to Buyer as a remedy, Buyer shall,
upon sending a Default Notice, be entitled to terminate this Agreement, recover
the Deposit, receive reimbursement from Seller of Buyer’s actually incurred,
third party out of pocket costs in conjunction with this Agreement, without any
cap, and receive from Seller as liquidated damages as a result thereof, an
amount equal to $250,000, after which both parties shall be released from all
further obligations under this Agreement except as otherwise provided herein.
Notwithstanding anything set forth herein to the contrary, if Buyer has funded
the balance of the Purchase Price at Closing in accordance with this Agreement
and Seller has defaulted, Buyer shall, if entitled, be promptly returned the
balance of the Purchase Price from escrow; provided that in connection with any
action for specific performance brought by Buyer, Buyer shall provide proof of
immediately available funds or post any bond that may be required by the court
or applicable law, in the amount of the balance of the Purchase Price, in
connection with such action.

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BUYER AND SELLER AGREE THAT IT WOULD BE IMPRACTICAL AND EXTREMELY DIFFICULT TO
ESTIMATE THE DAMAGES WHICH BUYER MAY SUFFER IN THE EVENT THAT SELLER’S DEFAULT
RESULTS IN SPECIFIC PERFORMANCE BEING UNAVAILABLE TO BUYER AS A REMEDY.
THEREFORE BUYER AND SELLER DO HEREBY AGREE THAT A REASONABLE ESTIMATE OF THE
TOTAL NET DETRIMENT THAT BUYER WOULD SUFFER IN THE EVENT OF SUCH A DEFAULT IS AN
AMOUNT EQUAL TO $250,000, IN ADDITION TO THE RETURN OF THE DEPOSIT AND
REIMBURSEMENT OF BUYER’S OUT OF POCKET EXPENSES. SAID AMOUNT SHALL BE THE FULL,
AGREED AND LIQUIDATED DAMAGES FOR SUCH A DEFAULT BY SELLER. THE PAYMENT OF SUCH
AMOUNT AS LIQUIDATED DAMAGES IS NOT INTENDED AS A FORFEITURE OR PENALTY.
 
/s/ MS
 
/s/ CKR
 
 
Buyer's Initials
 
Seller's Initials
 

20.2     DEFAULT BY BUYER. IN THE EVENT THE CLOSING AND THE CONSUMMATION OF THE
TRANSACTION HEREIN CONTEMPLATED DOES NOT OCCUR AS HEREIN PROVIDED BY REASON OF A
DEFAULT OF BUYER, SELLER’S SOLE REMEDY (EXCEPT AS PROVIDED BELOW) SHALL BE TO
TERMINATE THIS AGREEMENT AND RECEIVE THE DEPOSIT AS LIQUIDATED DAMAGES AND
SELLER SHALL BE RELEASED FROM ITS OBLIGATION TO SELL THE PROPERTY TO BUYER.
BUYER AND SELLER AGREE THAT IT WOULD BE IMPRACTICAL AND EXTREMELY DIFFICULT TO
ESTIMATE THE DAMAGES WHICH SELLER MAY SUFFER IN SUCH AN EVENT. THEREFORE BUYER
AND SELLER DO HEREBY AGREE THAT A REASONABLE ESTIMATE OF THE TOTAL NET DETRIMENT
THAT SELLER WOULD SUFFER IN THE EVENT THAT BUYER DEFAULTS AND FAILS TO COMPLETE
THE PURCHASE OF THE PROPERTY IS AND SHALL BE, AS SELLER’S SOLE AND EXCLUSIVE
REMEDY (WHETHER AT LAW OR IN EQUITY), AN AMOUNT EQUAL TO THE DEPOSIT (TO THE
EXTENT THERETOFORE DEPOSITED BY BUYER WITH ESCROW HOLDER). SAID AMOUNT SHALL BE
THE FULL, AGREED AND LIQUIDATED DAMAGES FOR THE BREACH OF THIS AGREEMENT BY
BUYER, ALL OTHER CLAIMS TO DAMAGES OR OTHER REMEDIES BEING HEREIN EXPRESSLY
WAIVED BY SELLER, OTHER THAN THOSE OBLIGATIONS THAT EXPRESSLY SURVIVE
TERMINATION OF THIS AGREEMENT, INCLUDING, BUT NOT LIMITED TO, BUYER’S OBLIGATION
TO INDEMNIFY SELLER UNDER PARAGRAPH 19, AND THE RIGHT TO COLLECT ATTORNEYS’ FEES
AND COSTS IN ANY ACTION TO ENFORCE THIS PROVISION. THE PAYMENT OF SUCH AMOUNT AS
LIQUIDATED DAMAGES IS NOT INTENDED AS A FORFEITURE OR PENALTY. UPON SUCH A
DEFAULT BY BUYER, THIS AGREEMENT SHALL BE TERMINATED AND EXCEPT AS PROVIDED IN
THIS PARAGRAPH, NEITHER PARTY SHALL HAVE ANY FURTHER RIGHTS OR OBLIGATIONS
HEREUNDER, EACH TO THE OTHER.            
 
/s/ MS
 
/s/ CKR
 
 
Buyer's Initials
 
Seller's Initials
 

            

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20.3     Limited Liability. Notwithstanding anything to the contrary herein,
Buyer on its own behalf and on behalf of its agents, members, partners,
employees, representatives, officers, directors, agents, related and affiliated
entities, successors and assigns (collectively, the “Buyer Parties”) hereby
agrees that in no event or circumstance shall any of the members, partners,
employees, representatives, officers, directors, agents, affiliated or related
entities of Seller or Seller’s property management company have any personal
liability under this Agreement. Seller on its own behalf and on behalf of its
agents, members, partners, employees, representatives, related and affiliated
entities, successors and assigns hereby agrees that in no event or circumstance
shall any of the Buyer Parties have any personal liability under this Agreement.
Notwithstanding anything to the contrary contained herein: (a) the maximum
aggregate liability of Seller, and the maximum aggregate amount which may be
awarded to and collected by Buyer (including, without limitation, for any breach
of any representation, warranty and/or covenant of Seller) under this Agreement
or any documents executed pursuant hereto or in connection herewith, including,
without limitation, the Exhibits attached hereto (collectively, the “Other
Documents”) shall, under no circumstances whatsoever, exceed an amount equal to
$1,100,000 (the “CAP Amount”); and (b) no claim by Buyer alleging a breach by
Seller of any representation, warranty and/or covenant of Seller contained
herein or any of the Other Documents may be made, and Seller shall not be liable
for any judgment in any action based upon any such claim, unless and until such
claim, either alone or together with any other claims by Buyer alleging a breach
by Seller of any such representation, warranty and/or covenant, is for an
aggregate amount in excess of $50,000.00 (the “Floor Amount”), in which event
Seller’s liability respecting any final judgment concerning such claim or claims
shall be subject to the CAP Amount set forth in clause (a) above. Seller and
Buyer agree that neither the Floor Amount nor the CAP Amount shall apply to any
claims made under Paragraph 11 hereof or any recovery based solely on fraud.

21.     Assignment. Buyer shall have the one-time right to assign its rights and
obligations under this Agreement to an entity wholly owned and controlled by the
principals of Buyer, by giving prior written notice to Seller, provided that
such assignee expressly assumes the obligations of Buyer arising thereafter,
provided however that Buyer remains liable for any obligations of “Buyer” under
this Agreement notwithstanding any such assignment (i.e., as if such assignment
did not occur). Any assignee shall succeed to all the rights and remedies
hereunder, including, but not limited to, the specific performance of this
Agreement.
22.     As-Is/Release. AS A MATERIAL INDUCEMENT TO THE EXECUTION AND DELIVERY OF
THIS AGREEMENT BY SELLER AND THE PERFORMANCE BY SELLER OF ITS DUTIES AND
OBLIGATIONS HEREUNDER, BUYER DOES HEREBY ACKNOWLEDGE, REPRESENT, WARRANT AND
AGREE, TO AND WITH THE SELLER, THAT, EXCEPT FOR THE EXPRESS REPRESENTATIONS,
WARRANTIES AND COVENANTS OF SELLER UNDER THIS AGREEMENT AND THE DOCUMENTS
EXECUTED AT CLOSING, (A) BUYER IS PURCHASING THE PROPERTY IN AN “AS-IS”
CONDITION AS OF THE DATE OF THE CLOSE OF ESCROW WITH RESPECT TO ANY FACTS,
CIRCUMSTANCES, CONDITIONS AND DEFECTS; (B) SELLER HAS NO OBLIGATION TO REPAIR OR
CORRECT ANY SUCH FACTS, CIRCUMSTANCES, CONDITIONS OR DEFECTS OR COMPENSATE BUYER
FOR SAME; (C) BY THE CLOSE OF ESCROW, BUYER SHALL HAVE UNDERTAKEN ALL SUCH
PHYSICAL

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INSPECTIONS AND EXAMINATIONS OF THE PROPERTY AS BUYER DEEMS NECESSARY OR
APPROPRIATE UNDER THE CIRCUMSTANCES, AND THAT BASED UPON SAME, BUYER IS AND WILL
BE RELYING STRICTLY AND SOLELY UPON SUCH INSPECTIONS AND EXAMINATIONS AND THE
ADVICE AND COUNSEL OF ITS AGENTS AND OFFICERS, AND BUYER IS AND WILL BE FULLY
SATISFIED THAT THE PURCHASE PRICE IS FAIR AND ADEQUATE CONSIDERATION FOR THE
PROPERTY; (D) SELLER IS NOT MAKING AND HAS NOT MADE ANY WARRANTY OR
REPRESENTATION WITH RESPECT TO ALL OR ANY PART OF THE PROPERTY (INCLUDING, BUT
NOT LIMITED TO, ANY MATTERS CONTAINED IN DOCUMENTS MADE AVAILABLE OR DELIVERED
TO BUYER IN CONNECTION WITH THIS AGREEMENT) AS AN INDUCEMENT TO BUYER TO ENTER
INTO THIS ESCROW AND THEREAFTER TO PURCHASE THE PROPERTY OR FOR ANY OTHER
PURPOSE; AND (E) BY REASON OF ALL OF THE FOREGOING, BUYER SHALL ASSUME THE FULL
RISK OF ANY LOSS OR DAMAGE OCCASIONED BY ANY FACT, CIRCUMSTANCE, CONDITION OR
DEFECT PERTAINING TO THE PROPERTY, INCLUDING WITHOUT LIMITATION THE PRESENCE OF
ANY ASBESTOS CONTAINING MATERIAL, HAZARDOUS MATERIAL, TOXIC OR RADIOACTIVE
WASTE, SUBSTANCE OR MATERIALS IN, ON, UNDER OR ABOUT THE PROPERTY, AND BUYER
HEREBY EXPRESSLY AND UNCONDITIONALLY WAIVES AND RELEASES SELLER AND ALL OF THEIR
RESPECTIVE PARENTS, SUBSIDIARIES, AFFILIATES AND PARTNERSHIPS, OFFICERS,
DIRECTORS, SHAREHOLDERS, PARTNERS, MEMBERS, AGENTS AND EMPLOYEES, AND THEIR
RESPECTIVE SUCCESSORS, HEIRS AND ASSIGNS AND EACH OF THEM (INDIVIDUALLY AND
COLLECTIVELY, THE “RELEASED PARTIES”) FROM ANY AND ALL RIGHTS AND CLAIMS AGAINST
SELLER AND/OR THE RELEASED PARTIES WITH RESPECT TO THE PROPERTY (INCLUDING
WITHOUT LIMITATION THE CONDITION, VALUATION, MARKETABILITY OR UTILITY OF THE
PROPERTY AND ANY RIGHTS OF BUYER UNDER THE STATE OR FEDERAL COMPREHENSIVE
ENVIRONMENTAL RESPONSE, COMPENSATION AND LIABILITY ACT, AS AMENDED FROM TIME TO
TIME, OR SIMILAR LAWS), EXCEPT TO THE EXTENT SUCH RIGHTS AND CLAIMS ARISE FROM
OR RELATE TO THE EXPRESS REPRESENTATIONS, WARRANTIES AND COVENANTS OF SELLER
UNDER THIS AGREEMENT AND THE DOCUMENTS EXECUTED AT CLOSING. THIS RELEASE
INCLUDES CLAIMS OF WHICH BUYER IS PRESENTLY UNAWARE OF WHICH BUYER DOES NOT
PRESENTLY SUSPECT TO EXIST WHICH, IF KNOWN BY BUYER, WOULD MATERIALLY AFFECT
BUYER’S RELEASE TO SELLER. IN CONNECTION AND TO THE EXTENT PERMITTED BY LAW,
BUYER HEREBY AGREES, REPRESENTS AND WARRANTS THAT BUYER REALIZES AND
ACKNOWLEDGES THAT FACTUAL MATTERS NOW UNKNOWN TO IT MAY HAVE GIVEN OR MAY
HEREAFTER GIVE RISE TO CAUSES OF ACTION, CLAIMS, DEMANDS, DEBTS, CONTROVERSIES,
DAMAGES, COSTS, LOSSES AND EXPENSES WHICH ARE PRESENTLY UNKNOWN, UNANTICIPATED
AND UNSUSPECTED, AND BUYER FURTHER AGREES, REPRESENTS AND WARRANTS THAT THE
WAIVERS AND RELEASES HEREIN HAVE BEEN NEGOTIATED AND AGREED UPON IN LIGHT OF
THAT REALIZATION AND THAT BUYER NEVERTHELESS HEREBY INTENDS TO RELEASE,
DISCHARGE AND ACQUIT SELLER AND THE RELEASED PARTIES FROM

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ANY SUCH UNKNOWN CAUSES OF ACTION, CLAIMS, DEMANDS, DEBTS, CONTROVERSIES,
DAMAGES, COSTS, LOSSES AND EXPENSES.
 
/s/ MS
 
 
 
 
Buyer's Initials
 
 
 

23.     Miscellaneous.

23.1     Partial Invalidity. If any term or provision of this Agreement or the
application thereof to any person or circumstance shall, to any extent, be
invalid or unenforceable, the remainder of this Agreement, or the application of
such term or provision to persons or circumstances other than those as to which
it is held invalid or unenforceable, shall not be affected thereby, and each
such term and provision of this Agreement shall be valid and be enforced to the
fullest extent permitted by law.
23.2     Waivers. No waiver of any breach of any covenant or provision herein
contained shall be deemed a waiver of any preceding or succeeding breach
thereof, or of any other covenant or provision herein contained. No extension of
time for performance of any obligation or act shall be deemed an extension of
the time for performance of any other obligation or act.
23.3     Survival of Representations. The covenants, agreements, representations
and warranties made herein shall survive the Close of Escrow for a period of
nine (9) months.
23.4     Successors and Assigns. This Agreement shall be binding upon and shall
inure to the benefit of the permitted successors and assigns of the parties
hereto.
23.5     Professional Fees. In the event of the bringing of any action or suit
by a party hereto against another party hereunder by reason of any breach of any
of the covenants, agreements or provisions on the part of the other party
arising out of this Agreement, then in that event the prevailing party shall be
entitled to have and recover from the other party all costs and expenses of the
action or suit, including actual attorneys’ fees, accounting and engineering
fees, and any other professional fees resulting therefrom.
23.6     Entire Agreement. This Agreement (including all Exhibits attached
hereto) 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. The
parties do not intend to confer any benefit hereunder on any person, firm or
corporation other than the parties hereto.
23.7     Time of Essence. Seller and Buyer hereby acknowledge and agree that
time is of the essence with respect to this Agreement.

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23.8    Construction. Headings at the beginning of each paragraph and
subparagraph are solely for the convenience of the parties and are not a part of
the Agreement. Whenever required by the context of this Agreement, the singular
shall include the plural and the masculine shall include the feminine and vice
versa. This Agreement shall not be construed as if it had been prepared by one
of the parties, but rather as if both parties had prepared the same. Unless
otherwise indicated, all references to paragraphs and subparagraphs are to this
Agreement. All exhibits referred to in this Agreement and the Glossary of Terms
are attached and incorporated by this reference. In the event the date on which
Buyer or Seller is required to take any action under the terms of this Agreement
is not a business day, the action shall be taken on the next succeeding business
day.
23.9     Governing Law. The parties hereto expressly agree that this Agreement
shall be governed by, interpreted under, and construed and enforced in
accordance with the laws of the State of Nevada.
23.10    Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, and all of which,
together, shall constitute one and the same instrument.
23.11     No Joint Venture. This Agreement shall not create a partnership or
joint venture relationship between Buyer and Seller.
23.12     Confidentiality. Neither Buyer nor Seller shall make any public
announcement or disclosure of any information related to this Agreement to
outside brokers other than (i) Broker or third parties before the Closing Date
and (ii) following any termination of this Agreement, without the mutual
agreement of the parties. Notwithstanding the foregoing, (a) Seller and Buyer
may disclose the terms of this Agreement to their respective affiliates, agents,
attorneys, consultants, underwriters, prospective underwriters, placement
agents, prospective placement agents, and employees to the extent necessary to
permit such third parties to assist Seller or Buyer in performing their
respective obligations hereunder, including Buyer’s consultants engaged to
conduct due diligence, to Buyer’s prospective property managers, to Ground
Lessor and Buyer’s financing and investor sources, and to the extent required by
law; provided that all such third parties shall be advised of the confidential
nature of this Agreement and instructed not to disclose information to others;
and (b) Buyer may disclose the terms of this Agreement (i) to the extent Buyer
or its affiliates determine, in consultation with its legal counsel, that such
disclosure is required by applicable law or otherwise required in connection
with any filing by Buyer or its affiliates with the SEC or any stock exchange
rule applicable to Buyer or its affiliates; and (ii) to the extent Buyer or its
affiliates determine, in consultation with legal counsel, that such disclosure
is required in any prospectus, report or other filing made by Buyer or its
affiliates with the SEC or any stock exchange or in any press release, earnings
release or supplemental data related thereto; provided that any press release
shall be subject to the mutual approval of both Seller and Buyer (except that so
long as neither Seller’s name nor the Purchase Price is disclosed, Buyer may
reference the address of the Property and the fact that Buyer acquired the same
without Seller’s approval). Buyer agrees that all information, whether written
or verbal, relating to the physical condition of the Property and regardless of
whether such information was obtained by Seller or Buyer, shall constitute the
confidential information of Seller prior to the Closing and following any
termination of this Agreement and that the

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unauthorized use or disclosure of such confidential information would cause
irreparable harm to Seller. Notwithstanding anything to the contrary in this
Paragraph 23.12, confidential information shall not include information that:
(A) is already public knowledge or becomes public knowledge through no fault,
action or inaction of Buyer; (B) Buyer is compelled or required by applicable
law or administrative or legal process to disclose; or (C) was rightfully in
Buyer’s possession without restriction prior to receipt from Seller or was
independently developed by Buyer without the use of any confidential
information, and such possession and/or independent development can be
demonstrated by written evidence. Seller acknowledges that it is Buyer’s
intention that the ultimate acquirer be a subsidiary of a corporation that is or
intends to qualify as a real estate investment trust and that, as such, it is
subject to certain filing and reporting requirements in accordance with federal
laws and regulations, including but not limited to, regulations promulgated by
the SEC. Accordingly, and notwithstanding any provision of this Agreement or the
provisions of any other existing agreement between the parties hereto to the
contrary, Buyer may publically file, disclose, report or publish any and all
information related to this transaction that may be reasonably interpreted as
being required by federal law or regulation. This provision shall expressly
survive the termination of this Agreement.
24.     Section 1031 Exchange. Seller and Buyer acknowledge that the electing
party may elect to effect the sale and purchase of the Property as an exchange
pursuant to Section 1031 of the Internal Revenue Code, provided the electing
party utilizes the services of a “qualified intermediary” as defined in Treasury
Regulation § 1.1031(k)‑(g)(4)(iii) (“Intermediary”) to effectuate such
Section 1031 exchange and will reasonably cooperate in the accomplishment of
that purpose provided only that (i) the other party shall not be required to be
vested in title to any parcel other than the Property, (ii) the other party
shall incur no liability or expense beyond those inherent in an acquisition of
the Property for a cash payment nor be delayed in the Closing, (iii) the
electing party shall not be released or absolved of its obligations under this
Agreement, and (iv) the electing party shall indemnify, defend and hold harmless
the other party and its officers, directors, employees, representatives and
agents from and against any liability, damages, expenses, costs and/or losses
arising out of the exchange.
25.     Ground Lessor’s Right of First Offer and Consent to Assignment.
(a)    Buyer acknowledges and agrees that under Section 14.8 of the Ground
Lease, Ground Lessor has a general right of first offer with respect to, among
other things, third-party sales of the Property. Such right of first offer with
respect to the sale of the Property by Seller to Buyer pursuant to the terms of
this Agreement has been waived by Ground Lessor, and a copy of such waiver has
been delivered to Buyer. If (i) Ground Lessor’s right of first offer with
respect to the sale of the Property to Buyer pursuant to the terms of this
Agreement has not been waived by Ground Lessor or otherwise expired without
being exercised, and (ii) as a result, Buyer’s rights under this Agreement are
not legally enforceable, this Agreement and the Escrow shall automatically and
immediately terminate, and Seller agrees to pay to Buyer, as liquidated damages
and as Buyer’s sole and exclusive remedy as a result thereof, an amount equal to
$250,000 (in addition to the return of the Deposit to Buyer).
BUYER AND SELLER AGREE THAT IT WOULD BE IMPRACTICAL AND EXTREMELY DIFFICULT TO
ESTIMATE THE DAMAGES WHICH BUYER MAY SUFFER IN THE EVENT THAT GROUND LESSOR’S
RIGHT OF FIRST OFFER

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HAS NOT BEEN WAIVED. THEREFORE BUYER AND SELLER DO HEREBY AGREE THAT A
REASONABLE ESTIMATE OF THE TOTAL NET DETRIMENT THAT BUYER WOULD SUFFER IN THE
EVENT THAT GROUND LESSOR’S RIGHT OF FIRST OFFER HAS NOT BEEN WAIVED IS AN AMOUNT
EQUAL TO $250,000, IN ADDITION TO THE RETURN OF THE DEPOSIT AND REIMBURSEMENT OF
BUYER’S OUT OF POCKET EXPENSES. SAID AMOUNT SHALL BE THE FULL, AGREED AND
LIQUIDATED DAMAGES IN THE EVENT THAT GROUND LESSOR’S RIGHT OF FIRST OFFER HAS
NOT BEEN WAIVED. THE PAYMENT OF SUCH AMOUNT AS LIQUIDATED DAMAGES IS NOT
INTENDED AS A FORFEITURE OR PENALTY.     
 
/s/ MS
 
/s/ CKR
 
 
Buyer's Initials
 
Seller's Initials
 

(b)    On or before the expiration of the Contingency Period, Seller shall use
its commercially reasonable efforts to obtain Ground Lessor’s written consent to
the assignment of the Ground Lease to Buyer. In the event Seller fails to obtain
Ground Lessor’s consent to the assignment of the Ground Lease to Buyer, this
Agreement and the Escrow shall automatically and immediately terminate, the
Deposit shall be returned to Buyer, Buyer shall be entitled to receive from
Seller reimbursement of Buyer’s actually incurred out‑of‑pocket expenses
incurred in connection with pursuing the transactions contemplated by this
Agreement, including without limitation Buyer’s attorneys’ fees (not to exceed
$100,000), and except as expressly set forth herein, neither party shall have
any further liability or obligation to the other hereunder.

(c)    For the avoidance of doubt, the foregoing reimbursement obligations shall
survive any termination of this Agreement.
26.     Seller Guarantor. Seller Guarantor joins in this Agreement for the
purpose of guarantying compliance by Seller with all obligations of Seller
contained in (i) this Agreement to the extent that the same survive Closing, and
(ii) the documents to be signed at Closing (collectively, the “Seller
Obligations”). Subject to the limitations on liability set forth in Section 20.3
above, Seller Guarantor absolutely and unconditionally agrees to be jointly and
severally responsible for all of the Seller Obligations. The guaranty set forth
in this Paragraph 26 is a continuing guaranty of payment and is not conditional
or contingent upon any attempt to collect from Seller or upon any other
condition or contingency. Subject to the limitations on liability set forth in
Section 20.3 above, the liability of Seller Guarantor under this Agreement shall
in no way be limited or impaired by, and Seller Guarantor hereby consents to and
agrees to be bound by, any amendment or modification of the provisions of this
Agreement. Seller Guarantor waives any notice of the modification or amendment
of this Agreement. Seller Guarantor represents and warrants to Buyer that:
Seller Guarantor is a real estate investment trust validly formed in the State
of Maryland; Seller Guarantor has full power and authority to enter into the
obligations set forth in this Paragraph 26, to perform the obligations set forth
in this Paragraph 26, and to consummate the transactions contemplated hereby;
the execution, delivery and performance of the obligations set forth in this
Paragraph 26 and all documents contemplated hereby by Seller Guarantor have been
duly and validly authorized by all necessary action on the part of Seller
Guarantor; all required consents and approvals have been duly obtained and will
not result in a breach of any of the terms or provisions of, or constitute a

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default under any indenture, agreement or instrument to which Seller Guarantor
is a party; this Agreement is a legal, valid and binding obligation of Seller
Guarantor, enforceable against Seller Guarantor in accordance with its terms,
subject to the effect of applicable bankruptcy, insolvency, reorganization,
arrangement, moratorium or other similar laws affecting the rights of creditors
generally; and Seller Guarantor is a member of Seller and will derive a material
benefit from the transactions contemplated by this Agreement. The provisions of
this Paragraph 26 shall survive Closing.
Notwithstanding the foregoing, on or before the expiration of the Contingency
Date, Seller Guarantor can elect to provide a letter of credit for the CAP
Amount in lieu of the foregoing guaranty, which letter of credit (i) shall be in
a form, and be issued by a financial institution, reasonably acceptable to Buyer
prior to the expiration of the Contingency Date, (ii) shall be held by Buyer
during the survival period, and (iii) Seller shall cause to be deposited on the
Closing and such letter of credit shall constitute a Seller deliverable pursuant
to Section 8.1 above.
27.     Cooperation with Buyer’s Auditors and SEC Filing Requirements. Upon
reasonable prior written notice to Seller, Seller shall, at no cost to Seller,
reasonably cooperate with Buyer to provide Buyer access to such factual
information concerning the operation of the Property as may be reasonably
requested by Buyer, and in the possession or control of Seller, or its property
manager or accountants, to enable Buyer or its affiliates to prepare audited
financial statements as may be required by the Securities and Exchange
Commission (“SEC”). Upon reasonable prior written notice to Seller and on other
terms reasonably acceptable to Seller, at Buyer’s sole cost and expense, Seller
shall allow Buyer’s auditor to conduct an audit of the statement of revenue and
expenses of the Property and shall reasonably cooperate (at no cost to Seller)
with Buyer’s auditor in the conduct of such audit and review and in connection
with such audit and review deliver to Buyer’s auditor a representation letter in
the form attached hereto as Exhibit “K” with respect to the period of time
during which Seller owned the Property. The obligations of Seller under this
Section 27 shall survive the Closing for a period of six (6) months after the
last day of the calendar year in which Closing occurred.
28.     Exclusivity. From and after the Execution Date, Seller and its
respective agents, representatives and employees shall immediately cease all
marketing of the Property until such time as this Agreement is terminated.
Furthermore, from and after the Contingency Date, and provided Buyer has not
terminated this Agreement, Seller agrees not to directly or indirectly make,
accept, negotiate, entertain or otherwise pursue any offers for the sale of the
Property.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date and year hereinabove written.
BUYER:
GAHC4 RENO NV MOB, LLC,
a Delaware limited liability company
By:
GAHC4 RENO NV MOB Sole Member, LLC,
 
a Delaware limited liability company
Its:
Sole Member
 
 
 
 
 
 
By:
Griffin-American Healthcare REIT IV Holdings,
 
 
LP, a Delaware limited partnership
 
Its:
Sole Member
 
 
 
 
 
By:
Griffin-American Healthcare REIT IV, Inc.,
 
 
 
a Maryland corporation
 
 
Its:
General Partner
 
 
 
 
 
 
 
 
 
 
 
 
 
By:
/s/ Mathieu Streiff
 
 
 
 
 
 
 
 
Name:
Mathieu Streiff
 
 
 
 
 
 
 
 
Title:
Executive Vice President and General Counsel

Signature Page

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SELLER:
ARLINGTON MEDICAL PROPERTIES,
LLC, an Arizona limited liability company
By:
Universal Health Realty Income
 
Trust, a Maryland real estate
 
investment trust, its Member
 
 
 
 
 
 
 
 
 
 
 
By:
/s/ Cheryl K. Ramagano
 
Name:
Cheryl K. Ramagano
 
Title:
V.P. + Treasurer

SELLER GUARANTOR:

UNIVERSAL HEALTH REALTY INCOME
TRUST, a Maryland real estate investment trust

By:
/s/ Cheryl K. Ramagano
Name:
Cheryl K. Ramagano
Title:
Vice President + Treasurer

Signature Page

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Acknowledgement:

ESCROW HOLDER:

FIRST AMERICAN TITLE INSURANCE COMPANY

By:
/s/ Angelique Sizemore
Name:
Angelique Sizemore
Title:
Escrow Officer

Signature Page