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Exhibit 10.2

 

AGREEMENT OF PURCHASE AND SALE
OF
LIMITED LIABILITY COMPANY MEMBERSHIP INTERESTS
 
between

RESOURCE AMERICA, INC.,
as
Seller,
 
and
 
RSI ASSOCIATES, LLC
as
Purchaser

 
Dated as of: February ____, 2008

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AGREEMENT OF PURCHASE AND SALE OF
LIMITED LIABILITY COMPANY MEMBERSHIP INTERESTS

           THIS AGREEMENT OF PURCHASE AND SALE OF LIMITED LIABILITY COMPANY
MEMBERSHIP INTERESTS (“Agreement”) is made and entered into this ______ day of
February, 2008 by and between RESOURCE AMERICA, INC., a Delaware corporation
(“Seller”), and RSI ASSOCIATES, LLC, a Delaware limited liability company
(“Purchaser”).
 
RECITALS
 
A.           Seller is the owner of 100% of the membership interests in Resource
RSI Phase 1, LLC, a Delaware limited liability company (“RSI I”)and Resource RSI
Phase II, LLC, a Delaware limited liability company (“RSI II” and together with
RSI I, the ”Companies”).

B.           RSI I owns that certain parcel of real property located at 102-10
East Bay Street, Savannah, Georgia, as more particularly described on Exhibit A
attached hereto (the “Phase I Property”) and RSI II holds a leasehold interest
in the 3rd, 4th and 5th floors of that certain real property which is adjacent
and contiguous to the Phase I Property and located at 115 East Bay Street,
Savannah, Georgia as more particularly described on Exhibit B attached hereto
(the “Phase II Property” and together with the Phase I Property, the
“Property”).

C.           Purchaser desires to purchase and assume from Seller and Seller
desires to sell and assign a Thirty percent (30.00%) membership interest in each
of RSI I and RSI II constituting thirty percent (30%) of the membership interest
in the Companies and all rights, privileges and obligations attendant thereto
(the “Acquired Interests”) subject to and upon the terms and conditions
hereinafter set forth.

NOW, THEREFORE, in consideration of the premises and the mutual covenants
hereinafter set forth, Seller hereby agrees to sell and assign, and Purchaser
hereby agrees to purchase and assume, all of Seller's right, title and interest
in the Acquired Interests upon the following terms and conditions:

1.           Purchase Price.    The purchase price for the Acquired Interests
shall be One Million Six Hundred Sixty Four Thousand One Hundred Sixty Five and
49/100 Dollars ($1,664,165.49) (the “Purchase Price”).
 
2.           Payment of Purchase Price.  The Purchase Price shall be payable as
follows:
 
(a)           On the Initial Closing Date (as hereinafter defined), Purchaser
shall acquire a Nineteen and 99/100 percent (19.99%) membership interest in each
of the Companies (the “Initial Acquired Interests”) upon the payment to Seller
of One Million One Hundred Sixty Four Thousand One Hundred Sixty Five and 49/100
Dollars ($1,164,165.49)which shall be paid to Seller by cash, certified or bank
check delivered at 1845 Walnut Street, Philadelphia, PA, Attn: Alan Feldman or
by wire transferred funds to such account as Seller may designate; and
 

 
 

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(b)           On the Second Closing Date (as hereinafter defined), Purchaser
shall acquire an additional Ten and 01/100 percent (10.01%) membership interest
in each of the Companies (the “Second Acquired Interests”) upon the payment to
Seller of Five Hundred Thousand Dollars ($500,000) which shall be paid to Seller
by cash, certified or bank check delivered at 1845 Walnut Street, Philadelphia,
PA, Attn: Alan Feldman or by wire transferred funds to such account as Seller
may designate.
 
3.           Time and Place of Closing.
 
(a)           Closing on the Initial Acquired Interests (the “Initial Closing”)
shall take place at 10:00 A.M. Philadelphia, Pennsylvania time on the first
business day which is ten (10) days after notice of the proposed transfer is
delivered (the “Initial Closing Date”) to the current holder of that certain
loan in the original principal amount of $12,500,000 initially made by Greenwich
Capital Financial Products, Inc. (“Lender”) and secured by the Property (the
“Loan”); and
 
(b)           Closing on the Second Acquired Interests (the “Second Closing”)
shall take place at 10:00 A.M. Philadelphia, Pennsylvania time on a date
mutually agreed upon by Seller and Purchaser after receipt of approval from
Lender by to the Companies (the “Second Closing Date” and together with the
Initial Closing Date, the “Closing Dates”).
 
(c)           Each of the closings shall occur, at the Seller’s option, either
(a) at the offices of the Seller’s counsel or (b) through an escrow on terms
acceptable to the parties’ respective counsel, it being understood that if the
Closing shall occur through escrow, neither Purchaser, Seller nor their
respective counsel need be physically present at the Closing so long as (i) all
documents that are required to be delivered at Closing are fully executed,
delivered in escrow and available on the date of Closing, (ii) any authorized
signatory of the affected party is available either in person or by telephone
and facsimile at Closing, and (iii) the Purchase Price has been paid or wire
transferred on or prior to Closing.
 
4.           Conditions to Closing.
 
(a)           Purchaser' Conditions.  Purchaser's obligation to pay the Purchase
Price and to acquire the Acquired Interests shall be subject to compliance by
Seller on or before the applicable Closing Date:
 
(i)           execution by Seller of an Assignment and Assumption of Partnership
Interests in the form of Exhibit C (“Assignments of Interests”) for each of RSI
I and RSI II and delivery of such documents to Seller’s counsel to be held in
escrow until payment of the Purchase Price;
 
(ii)           such other documents as may be reasonably required to consummate
the transaction contemplated by this Agreement; and
 
(iii)           delivery of a copy of the consent of the Lender.
 

 
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(b)           Seller's Conditions.  Seller's obligation to sell the Acquired
Interests shall be subject to compliance by Purchaser with the following
conditions precedent on or by the applicable Closing Date:
 
(i)           delivery of the Purchase Price by Purchaser;
 
(ii)           execution by Purchaser of the Assignments of Interests and
delivery of such documents to Seller’s counsel to be held in escrow until
payment of the Purchase Price; and
 
(iii)           such other documents as may be reasonably required to consummate
the transaction contemplated by this Agreement.
 
(c)           Conditions Generally.  The foregoing conditions are for the
benefit only of the parties for whom they are specified to be conditions
precedent and such parties may, in their sole discretion, waive any or all of
such conditions and close title under this Agreement without any increase in,
abatement of or credit against the Purchase Price.
 
5.           Seller's Representations and Warranties:  Seller represents and
warrants to Purchaser that:
 
(i)           Seller is a corporation that has been duly organized and is
validly existing and in good standing under the laws of the State of its
organization.
 
(ii)           Seller has the full power, authority and legal right to enter
into and perform this Agreement subject to the terms of Section 21 below.  The
execution, delivery and performance of this Agreement have been duly authorized
by all necessary legal action on the part of Seller.  The execution and delivery
of this Agreement and the consummation of the transactions contemplated hereby
do not require any governmental or other consent and will not result in the
breach of any agreement, indenture or other instrument to which Seller is a
party or is otherwise bound.
 
(iii)           Seller has not filed any petition seeking or acquiescing in any
reorganization, arrangement, composition, readjustment, liquidation, dissolution
or similar relief under any law relating to bankruptcy or insolvency, nor has
any such petition been filed against Seller. Seller is not insolvent and the
consummation of the transactions contemplated by this Agreement shall not render
Seller insolvent. No general assignment of Seller’s property has been made for
the benefit of creditors, and no receiver, master, liquidator or trustee has
been appointed for Seller or any of its property.
 
(iv)           Seller owns and holds good, marketable and indefeasible title to
the Acquired Interests and now has, and will as of the Closing Date have, the
authority to sell the Acquired Interests free and clear of any liens, claims,
charges or encumbrances of any kind or character against such interests.  Seller
has not previously assigned the Acquired Interests or any interest therein or
portion thereof to any other party, nor pledged, mortgaged or otherwise
hypothecated the Acquired Interests in favor of any other party. Upon the
consummation of the transfer of the Acquired Interests, Purchaser will receive
good and absolute title thereto, free from all liens, charges, encumbrances,
restrictive agreements and assessments whatsoever.
 

 
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(v)           Each of RSI I and RSI II has been duly organized and is validly
existing and subsisting under the laws of the state of its formation, with
requisite power and authority, and all rights, licenses, permits and
authorizations, governmental or otherwise, necessary to own its properties and
to transact the business in which it is now engaged.  Each of RSI I and RSI II
is duly qualified to do business and is in good standing in each jurisdiction
where it is required to be so qualified in connection with its properties,
business and operations.  Schedule 1 identifies each document pursuant to which
the Companies are organized or governed (“Organizational Documents”).
 
(vi)           The execution and delivery of this Agreement and, upon receipt of
the consent of the Lender, the consummation of the transactions contemplated
hereby will not result in the breach of any agreement, indenture or other
instrument to which the Companies are a party or is otherwise bound upon receipt
of the consent of the Lender.
 
(vii)           There is no pending or, to the best of Seller’s knowledge,
threatened litigation, proceeding (including, without limitation, condemnation
proceeding) or investigation (by any person, governmental or quasi-governmental
agency or authority or otherwise) which might materially adversely affect the
Companies.
 
(viii)                      That certain $12,500,000 mortgage loan (the
“Mortgage Loan”) made pursuant to that certain Loan Agreement dated June 30,
2006 between Greenwich Capital Financial Products, Inc. and the Companies (the
“Loan Agreement”) and the other loan documents related thereto constitutes a
legal, valid and binding obligation of the Companies enforceable against the
Companies in accordance with their respective terms, subject to applicable
bankruptcy, insolvency and similar laws affecting rights of creditors generally,
and general principles of equity.  To the best of Seller’s knowledge, the
Companies are not in default under the Mortgage Loan.  The outstanding balance
of the Mortgage Loan as of January 29, 2008 is $12,335,834.51.

(ix)           All of the representations and warranties in this Agreement shall
survive Closing and shall be deemed to have been relied upon by Purchaser.
 
6.           Purchaser's Representations and Warranties.   Purchaser represents
and warrants to Seller that:
 
(i)           Purchaser is a limited liability company that has been duly
organized and is validly existing under the laws of the state of its
organization; Purchaser has full power and right to enter into and perform its
obligations under this Agreement and the other closing documents contemplated
herein to be executed and delivered by it; and the execution and delivery of
this Agreement and the consummation of the transactions contemplated hereby have
been duly authorized by all necessary corporate acts and do not require any
governmental or other consent.
 
(ii)           Purchaser is fully aware that the Mortgage Loan is an obligation
of the Companies and has been provided with the Loan Agreement and all loan
documents related thereto.
 

 
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(iii)           Except as expressly set forth in this Agreement, Purchaser has
not relied and will not rely on, and neither Seller nor the Companies has made
and is not liable for or bound by, any express or implied warrants, guarantees,
statements, representations or information pertaining to the Property made or
furnished by Seller, the Companies, or any agent or third party representing or
purporting to represent Seller or the Companies, to whomever made or given,
directly or indirectly, orally or in writing.
 
(iv)           Purchaser is a knowledgeable, experienced and sophisticated
purchaser of real estate and that, except as expressly set forth in this
Agreement, it is relying solely on its own expertise in purchasing the Acquired
Interests and shall make an independent verification of the accuracy of any
documents and information provided by Seller or the Companies.  Purchaser will
conduct such inspections and investigations of the Property as Purchaser deems
necessary and shall rely upon same.
 
(v)           All of the representations and warranties in this Agreement shall
survive Closing and shall be deemed to have been relied upon by Seller.
 
7.           Interim Operations.  During the term of this Agreement, Seller
shall or shall cause the Companies, to the extent of its authority under the
Organizational Documents, to:
 
(a)           not create any lien or encumbrance upon or affecting title to the
Acquired Interests, and Seller shall not further mortgage, pledge, hypothecate
or convey, or perform any act which would result in an encumbrance of the
Acquired Interests, and
 
(b)           not solicit, accept or provide factual information or negotiate
with respect to, any offer to purchase the Acquired Interests from any person or
entity other than Purchaser or enter into any agreement, oral, written,
contingent or otherwise with any party (other than Purchaser) to sell the
Acquired Interests or any beneficial ownership interest therein.
 
8.           Adjustments.   Seller and Purchaser agree to split any and all
costs incurred in connection with obtaining any required consents.   For each
closing after the Initial Closing, the sole adjustment to the Purchase Price
shall be that Purchaser shall reimburse Seller for a portion of any reduction in
the principal balance of the Loan attributable to monthly payments computed by
multiplying the reduction in the principal balance of the loan by the percentage
of interests of each of the Companies acquired by Purchaser at such Closing (the
“Amortization Reimbursement”).  By way of example, for the Second Closing the
Amortization Reimbursement shall be calculated by multiplying any reduction in
the principal balance by .1001.  In the event that one party advances the funds
for the closing costs, the other will reimburse its share of such costs.
 
9.           Indemnification.  Seller and Purchaser each represent to the other
that it did not deal with any broker in connection with this
transaction.  Seller and Purchaser each covenant and agree to indemnify and hold
harmless the other party from and against any and all costs, expenses,
liabilities, claims, demands, suits, judgments and interest, including, but not
limited to, reasonable attorneys' fees and disbursements, arising out of or in
connection with any claim against such party by any other broker or agent with
respect to this Agreement, the negotiation of this Agreement or the transactions
contemplated herein based upon the acts of the indemnifying party.  The
provisions of this Section 9 shall survive the Closing.

 
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10.           Remedies.
 
(a)  Seller's Default.  If Seller shall materially breach any covenant or
obligation or materially breach any representation or warranty set forth herein
(which default is not waived in writing by Purchaser), then Purchaser shall have
the right to (i) terminate this Agreement by giving Seller timely written notice
prior to Closing or (ii) enforce specific performance or (iii) waive said
failure or breach and proceed to Closing.
 
(b)           Purchaser's Default.  If Purchaser breaches any covenant or
obligation herein or shall fail to close the transaction contemplated hereby
without legal excuse, then Seller’s sole remedy prior to the Initial Closing
Date shall be to declare this Agreement terminated by written notice to
Purchaser and after the Initial Closing Date Seller’s sole remedy shall be to
terminate Purchaser’s right to purchase the Second Acquired Interests.
 
11.           Notices. All notices, demands or other communications given
hereunder shall be in writing and shall be deemed to have been duly delivered
(i) upon the delivery (or refusal to accept delivery) by messenger or overnight
express delivery service (or, if such date is not on a business day, on the
business day next following such date), or (ii) on the second (2nd) Business Day
next following the date of its mailing by certified mail, postage prepaid, at a
post office maintained by the United States Postal Service, or (iii) upon the
receipt by facsimile transmission as evidenced by a receipt transmission report
(followed by delivery by one of the other means identified in (i)-(ii)),
addressed as follows:
 
If to Seller:
Resource RSI Phase 1, LLC
Resource RSI Phase II, LLC
1845 Walnut Street, 10th Floor
Philadelphia, PA 19103
Attn:  Alan Feldman
Facsimile:  (215) 640-6333
 
with a copy to:
Resource Real Estate, Inc.
1845 Walnut Street, 10th Floor
Philadelphia, PA 19103
Attn:  Shelle Weisbaum, Esq.
Facsimile:  (215) 761-0452
 
If to Purchaser:
RSI Associates, LLC
110 S. Poplar Street
Suite 101
Wilmington, DE 18901
Attention:  Adam Kauffman
Facsimile:  (215) 557-8585
 
with a copy to:
Brandywine Construction & Management, Inc.
1521 Locust Street, Suite 400
Philadelphia, PA 19102
Attention: Brad Begelman, Esquire
Facsimile:  (215) 557-8585
 

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Either party may, by notice given as aforesaid, change the address or addresses,
or designate an additional address or additional addresses, for its notices,
provided, however, that no notice of a change of address shall be effective
until actual receipt of such notice.  Either party may have it attorneys deliver
notices to the other party with the same force and effect as if given by the
party represented by such attorneys.  
 
12.           Choice of Law.  The interpretation, enforcement and performance of
this Agreement shall be governed by the laws of the Commonwealth of
Pennsylvania.
 
13.           Miscellaneous.
 
(a)  This Agreement constitutes the entire agreement of the parties hereto and
may not be modified or canceled except pursuant to the terms hereof or an
instrument in writing signed by the parties hereto.  The Schedules and Exhibits
annexed hereto are hereby incorporated herein by reference as fully as though
set forth herein.
 
(b)           In the event any dispute between the parties hereto results in
litigation, the prevailing party shall be reimbursed for all reasonable costs,
including, but not limited to, reasonable attorneys' fees.
 
(c)           The headings of the various Sections of this Agreement have been
inserted only for the purposes of convenience, are not part of this Agreement
and shall not be deemed in any manner to modify, explain, qualify or restrict
any of the provisions of this Agreement.
 
(d)           This Agreement may be executed in any number of counterparts with
the same effect as if all parties hereto had executed the same document.  All
such counterparts shall be construed together and shall constitute one
instrument.
 
(e)           This Agreement shall bind and inure to the benefit of the
respective heirs, executors, administrators, personal representatives,
successors and assigns of the parties hereto; provided, however, that neither
party hereto shall assign this Agreement without the prior written consent of
the other party; and, provided, further, however, that Purchaser shall be
entitled, without the prior written consent of Seller, to assign this Agreement
to any affiliate of Purchaser and, upon any such assignment and the assumption
of this Agreement by a permitted assignee, Purchaser shall be released and
relieved from any and all obligations and liabilities hereunder.  Any assignment
not permitted hereunder and undertaken without such prior written consent shall
be deemed null and void.
 
(f)           Seller and Purchaser agree that neither this Agreement nor any
memorandum thereof shall be recorded in any public records.

 
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(g)           Each of Seller and Purchaser shall provide to the other such
further assurances as may reasonably be required hereunder to effectuate the
purposes of this Agreement and, without limiting the foregoing, shall execute
and deliver such affidavits, certificates and other instruments as may be so
required hereunder so long as the same shall not in any manner increase the
liability of the party so executing and delivering said instrument.
 
(h)           This Agreement may not be changed or terminated orally by either
party; it may be amended only by a writing which is executed by Purchaser and
Seller.  No course of conduct or course of dealing by the parties, or failure by
any of the parties hereto to insist upon or enforce any rights herein, shall be
construed to constitute a waiver, modification, or amendment of any provision of
this Agreement in the absence of a writing by each party.  No waiver of any
breach hereunder shall be deemed to be a waiver of any other or subsequent
breach.
 
(i)           All references to a “Business Day” shall mean any day which shall
not be a Saturday, Sunday, legal holiday or day on which banking institutions in
the City of Philadelphia are authorized by law or executive order to close.  In
the event the date on which a party 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 thereafter.
 
(j)           Seller and Purchaser each agree that only the Federal Courts of
the United States sitting in the Eastern District of Pennsylvania shall have
exclusive jurisdiction in respect of any legal action or proceeding brought
against Seller or Purchaser and arising out of or relating to this Agreement
(“Proceedings”).  In connection with any such Proceeding, Seller and Purchaser
each irrevocably submits to the jurisdiction of the Federal Courts of the United
States in the Eastern District of Pennsylvania and waives any right of objection
to the laying of venue in any such court, including, without limitation, any
objection on the basis of inconvenient forum.  Seller and Purchaser each
irrevocably agree to be bound by any final judgment rendered thereby in
connection with this Agreement from which no appeal has been taken or is
available.
 
(k)           THE PARTIES HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE
ANY RIGHT THAT EITHER PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THE
PROPERTY, THE CLOSING DOCUMENTS OR ANY OTHER DOCUMENTS EXECUTED IN CONNECTION
HEREWITH, OR IN RESPECT OF ANY COURSE OF CONDUCT, STATEMENTS (WHETHER ORAL OR
WRITTEN), OR ACTIONS OF EITHER PARTY. THIS PROVISION IS A MATERIAL INDUCEMENT
FOR EACH OF THE PARTIES TO ENTER INTO THE TRANSACTIONS DESCRIBED HEREIN.
 
14.           Publicity.  Seller and Purchaser shall, prior to the Closing,
maintain the confidentiality of this transaction and shall not, except as
required by law, court order or direction of any governmental authority,
disclose the terms of this Agreement or of such sale and purchase to any third
parties other than to Lender and their respective employees, accountants,
attorneys and agents, and such other persons whose assistance is required in
carrying out the terms of this Agreement, including, without limitation,
attorneys, appraisers, accountants, engineers, architects, agents, consultants,
contractors, and advisors. If Seller or Purchaser are required by law, court
order or any governmental authority to issue such a press release or other
public communication concerning this Agreement prior to the Closing, Seller or
Purchaser, as applicable, shall deliver a copy of the proposed press release or
other public communication to the other parties for their review at least one
(1) Business Day prior to its issuance.
 

 
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15.           Purchase Option.  In consideration for Ten Dollars ($10.00) and
other good and valuable consideration, Purchaser shall have the right to
purchase (the “Purchase Option”) the remainder of Seller’s interests in the
Companies as follows:

(a)           Option.  Purchaser shall have the right to purchase the remainder
of the membership interests owned by Seller , provided that:

(i)           Purchaser must purchase the same percentage of membership
interests in each of RSI I and RSI II;

(ii)           Purchaser notifies Seller of its exercise of the Purchase Option
in writing no later than July 31, 2011;

(iii)           Seller has received any and all required consents under the loan
documents governing the Mortgage Loan for such transfer;

(iv)           Callen (as defined below) has failed to exercise its right of
ROFR in the event that Purchaser is purchasing a membership interest in an
amount which would increase its aggregate membership interest in the Companies
to more than 49%;

(v)           Seller and Purchaser shall cooperate in good faith to obtain the
necessary consents; and

(vi)           Seller is released from liability under any guarantees given to
the mortgage holder in connection with the Mortgage Loan.

(b)           Callen; Definitions.   RSI I hereby advises Purchaser that its
ownership interest in the Phase I Property is subject to a right of first
refusal (the “ROFR”) in favor of the Callen Trust (“Callen”) pursuant to the
terms of that certain Agreement dated March ___, 1999.  Under the ROFR, if RSI I
desires to sell the Phase I Property or any ownership interest in RSI I which
results in RSI I no longer holding majority ownership interest and voting
control, then Callen has the right of first refusal for 45 days to purchase the
subject interests at the same terms.

(c)           Purchase Price.  The purchase price for the membership interests
subject to the Purchase Option shall be $50,000 per 1.0% purchased (the “Option
Purchase Price”) and such sales shall be subject to the applicable terms
provided in Section 4 above.  Seller and Purchaser agree to split any and all
costs incurred in connection with obtaining any required consents.   The sole
adjustment to the Option Purchase Price shall be Purchaser reimbursing Seller an
amount equivalent attributable to the Amortization Reimbursement for the
membership interests being purchased.  Seller and Purchaser shall be responsible
for its own legal fees.
 
(d)          Other Sales.  During the term of this Purchase Option, Seller shall
not offer for sale or sell its membership interests in the Companies to anyone
other than Purchaser, a Permitted Transferee or Callen pursuant to its ROFR
unless Purchaser has delivered a written waiver and consent to Seller.

 
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16.           Right of First Offer.  In the event that Purchaser has not
purchased 100% of the membership interests owned by Seller in the Companies,
then from and after August 1,  2011 Purchaser shall have a right of first offer
(the “ROFO”) to purchase the balance of membership interests owned by Seller as
follows:

(a)                 If Seller desires to transfer all or any portion of its
membership interest in the Companies, other than to a Permitted Transferee, then
Seller shall be subject to and required to comply with a right of first offer on
the following terms and conditions:

(i)           Seller shall notify Purchaser of such interest and include in the
notice, the purchase price and any other terms (the “ROFO Terms”);

(ii)           Purchaser shall have the right and option to purchase the
membership interests designated in the notice by advising Seller in writing
within 30 days after receipt of such notice (which notice shall include all
documentation concerning the prospective transaction and is hereinafter referred
to as the “ROFO Notice”);

(iii)           If Purchaser elects to purchase the membership interests, then
the closing shall occur on a date designated by Purchaser upon 10 days notice to
Seller but not later than 60 days after the date of Seller’s initial notice
(unless the ROFO Terms specify a later closing date) and shall such Closing
shall be pursuant to the ROFO Terms or as otherwise agreed upon by the parties;

(iv)           If Purchaser does not elect to purchase the membership interests
or does not notify Seller within the applicable time period in Section 16(a)(ii)
above, the Seller shall have the right to transfer the membership interests
identified in the notice free and clear of the ROFO right for one hundred and
eighty (180) days after Purchaser’s receipt of the ROFO Notice upon the ROFO
Terms.  If Seller does not close such transaction within such one hundred and
eighty (180) day period or desires to sell any membership interests in the
Companies on materially different terms, Seller shall once again make a right of
first offer to Purchaser pursuant to the terms of this Section 16.  Any
membership interests in the Companies not sold as provided above, shall be
subject to this right of first offer.

(b)                 For purposes of Section 16 and 17 of this Agreement,
“Permitted Transferees” include any entity owned or controlled by Seller.

(c)                 Any purchase pursuant to the ROFO shall comply with the
following:

(i)           Purchaser must purchase the same percentage of membership
interests in each of RSI I and RSI II;

 
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(ii)           Seller has received any and all required consents under the loan
documents governing the Mortgage Loan for such transfer;

(iii)           Callen has failed to exercise its right of ROFR in the event
that Purchaser is purchasing a membership interest in an amount which would
increase its aggregate membership interest in the Companies to more than 49%;

(iv)           Seller and Purchaser shall cooperate in good faith to obtain the
necessary consents; and

(v)           Seller is released from liability under any guarantees given to
the mortgage holder in connection with the Mortgage Loan.

17.           Tag Along Rights.  If Seller desires to sell its membership
interests in the Companies to a third party other than Purchaser or a Permitted
Transferee after July 31, 2011, Purchaser shall have the right to sell a pro
rata amount of its membership interests to the third party purchaser pursuant to
the same terms and conditions that Seller is selling its membership interests.

18.           Rehabilitation of River Street Inn.  The parties acknowledge that
the Property is in the midst of being refurbished pursuant the budget attached
hereto has Exhibit D.  The parties agree that $453,388.00 of the budget has not
been expended.  Seller agrees to fund to the Companies without contribution from
the Purchaser such unexpended funds for repairs, improvements and betterments to
the hotel and Property as mutually agreed upon by Purchaser and Seller.

19.           Indemnity.  Seller agrees to indemnify Purchaser for Purchaser’s
pro rata share of any liability (such pro rata share being equal to the
membership interests being purchased) of the Companies accruing prior to the
date of the respective Closing.

20.           Operating Agreements.   The parties agree that the Companies’
Operating Agreements shall be amended concurrent with the Initial Closing to
provide as follows:
 
(a)                 For so long as either party owns a minimum of nineteen and
99/100 percent (19.99%) of the membership interests of the Companies, the
Companies shall not:

(i)           borrow money except in the ordinary course of business at
commercially reasonable terms;

(ii)          defease any debt and/or incur any prepayment penalty unless: (A)
the term of the loan to be paid off ends within one hundred and eighty (180)
days after the payment date; or (B) the party owning more than fifty percent
(50%) of the membership interests in the Companies (the “Majority Owner”) pays
any such defeasance costs and/or prepayment penalty;

 
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(iii)           lend money;

(iv)           sell or transfer the Phase I or Phase II Property unless at any
closing prior to July 31, 2011 Purchaser shall receive sales proceeds equal at
least to (A) any capital contributions made by Purchaser to the Companies: and
(B) the Purchase Price and as applicable the Option Purchase Price paid by
Purchaser for any membership interests in the Companies;
(v)    enter into or amend any agreement or lease that would have a material
adverse effect on the Companies' business or property;
 
(vi)           make capital expenditures in excess of  Ten Thousand Dollars
($10,000.00);

(vii)           terminate or amend the BCMI  Management and Leasing Agreement
(except for cause pursuant to such agreement or as required by the Lender under
the Loan documents); and/or

(viii)          initiate (provided that if Seller and Purchaser are not able to
reach an agreement on a new manager after good faith efforts, the Majority Owner
may make such decision and cause the Companies to enter into the Agreement),
terminate or amend any new management agreement (except for cause pursuant to
such agreement or as required by the Lender under the Loan documents);

without the consent of Seller and Purchaser.

(b)                 The Companies shall distribute all available cash flow after
retaining an annual reserve of Fifty Thousand Dollars ($50,000.00).

20.           Approval.  This Agreement is subject to the approval of Seller’s
Board of Directors and Seller agrees to attempt to obtain such approval within
fourteen (14) days.

21.           Survival.  The provisions of Section 5, 6, 15, 16, 17, 18, 19, and
21 hereof shall survive the closing of the purchase of the Acquired Interests
hereunder.

 
 [Remainder of Page Intentionally Left Blank]
 

 
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed
as of the day and year first above written.
 
 
SELLER:
RESOURCE AMERICA, INC.,

 
a Delaware corporation

 
By:  ________________________                                                    
Name:
Title:

 
PURCHASER:
RSI ASSOCIATES, LLC, a Delaware limited liability company

By:  ________________________
       Adam Kauffman, Manager

 
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EXHIBIT A

Legal Description of the Phase I Property

 
 

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EXHIBIT B

Legal Description of the Phase II Property

 
 

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EXHIBIT C

Assignment of Acquired Interests

ASSIGNMENT AND ASSUMPTION OF
LIMITED LIABILITY COMPANY MEMBERSHIP INTEREST
 
THIS ASSIGNMENT AND ASSUMPTION OF LIMITED LIABILITY COMPANY MEMBERSHIP INTEREST
(this “Assignment”) is made this ____ day of ______________, 2008, by and
between RESOURCE AMERICA, INC. a Delaware corporation, as assignor (“Assignor”),
and RSI ASSOCIATES, LLC,  a Delaware limited liability company (“Assignee”), as
assignee.
 
RECITALS
 
A.           Assignor, as seller, and Assignee, as buyer, have entered into that
certain Agreement of Purchase and Sale of Limited Liability Company Membership
Interests (the “Agreement of Sale”) dated February ____, 2008 to purchase and
sell a ______ percent (____%) membership interest (the “Membership Interest”) in
Resource RSI Phase ___, LLC, a Delaware limited liability company (the
“Company”), as more particularly described in the Agreement of Sale.
 
 
B.           Assignor desires to assign and set over to Assignee all of its
right, title and interest in and to the Membership Interest and any other rights
of Assignor with respect thereto, in its capacity as a member of the Company,
under that certain Limited Liability Company Agreement dated June 30, 2006 (
“LLC Agreement”).
 
 
C.           Assignee desires to assume and be responsible for all of Assignor’s
obligations with respect to the Membership Interest and any other obligations of
Assignor, in its capacity as a member of the Company, under the LLC Agreement.
 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, Assignor and Assignee agree as follows:

1.           Assignor assigns, sets over and transfers to Assignee all of its
right, title and interest in and to the Membership Interest and any and all
rights as a member in connection therewith under the LLC Agreement.

2.           Assignee hereby assumes all of Assignor’s right, title and interest
to the Membership Interest and agrees to be responsible for all of the
obligations of Assignor, in its capacity as a member of the Company in
connection therewith, and to be legally bound by and subject to all of the terms
the LLC Agreement.
 
3.           This Assignment shall be binding on the parties hereto and their
successors and assigns.
 

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IN WITNESS WHEREOF, intending to be legally bound, Assignor and Assignee have
caused this Assignment to be executed by their duly authorized officers on the
day and year first above written.
 
ASSIGNOR:
 
RESOURCE AMERICA, INC., a Delaware corporation

 
By:     _____________________________                                                  
                                Name:
Title:
 

 
ASSIGNEE:
 

RSI ASSOCIATES, LLC

By     ____________________________                                                           
         Adam Kauffman, Manager

 
 

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EXHIBIT D

Budget

 
 

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Schedule 1
 
Organizational Documents
 
Resource RSI Phase I, LLC.
 
 
1.
Certificate of Limited Partnership filed with the Pennsylvania Department of
State on June 27, 2006

 
 
2.
Limited Liability Company Agreement dated June 30, 2006

 

 
Resource RSI Phase II, LLC.
 
 
1.
Certificate of Limited Partnership filed with the Pennsylvania Department of
State on June 27, 2006

 
 
 
2.
Limited Liability Company Agreement dated June 30, 2006

 
 
 

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