LIMITED LIABILITY COMPANY AGREEMENT
OF KBS SOR SREF III 110 WILLIAM, LLC
This LIMITED LIABILITY COMPANY AGREEMENT OF KBS SOR SREF III 110 WILLIAM, LLC
(this “Agreement”), is entered into effective as of December 23, 2013, by and
between SREF III 110 William JV , LLC, a Delaware limited liability company (“JV
Member”), and KBS SOR 110 William JV, LLC, a Delaware limited liability company
(“KBS” or “Co-Managing Member”). JV Member and KBS may hereinafter be referred
to herein collectively, as the “Members” or individually as a “Member”.
ARTICLE I
FORMATION
1.01    Formation. The limited liability company created pursuant to this
Agreement and the filing of that certain Certificate of Organization dated
November 26, 2013 (the “Company”) was formed under and pursuant to the Act. The
term “Act” means the Delaware: 6 Delaware Code §§18-101, et. seq., Delaware
Limited Liability Code, as hereafter amended from time-to-time.
1.02    Names and Addresses. The name of the Company is KBS SOR SREF III 110
William, LLC. The principal office of the Company in the State of Delaware, and
the name and address of the registered agent of the Company in the State of
Delaware, shall Corporation Service Company, 2711 Centerville Road, Suite 400,
Wilmington, Delaware 19808, until changed by Managing Member with written notice
to all of the Members. The names, addresses, Percentage Interests (as defined in
Section 3.03) and initial capital contributions of the Members are set forth on
Exhibit A attached hereto. Managing Member shall update Exhibit A as necessary
to reflect any changes to the information reflected therein, including as a
result of changes in a Member’s address, additional capital contributions by the
Members in accordance with Article III and Transfers of Interests by the Members
in accordance with Article VI.
1.03    Nature of Business. The express, limited and only purposes of the
Company shall be (i) to directly or indirectly acquire, own, lease, hold for
long-term investment, sell, exchange, dispose of and otherwise realize the
economic benefit from that certain real property commonly known as 110 William
Street, Manhattan, New York, and described more particularly on Exhibit B
attached hereto (the “Property”), including the improvements currently and as
from time to time may be located on the Property (collectively, the
“Improvements”) (the Property and the Improvements shall sometimes be
collectively referred to as, the “Project”), and (ii) to conduct such other
activities with respect to the Project as are appropriate to carrying out the
foregoing purposes and to do all things incidental to or in furtherance of the
above-enumerated purposes.
110 William Holdings III, LLC, an affiliate of Managing Member (“Contract
Purchaser”), has entered into that certain Agreement of Purchase and Sale dated
as December 4, 2013 (the “Purchase Agreement”), with 110 William, LLC, as seller
(“Seller”). Concurrent with the full execution of this Agreement and KBS’s
contribution of the sum of nine million dollars ($9,000,000) to the Company in
accordance with Section 3.01(b), Managing Member shall (i) cause the Contract
Purchaser to assign to the Company all right, title and interest of the

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Contract Purchaser under the Purchase Agreement, including the $15,000,000
earnest money deposit previously delivered into escrow pursuant to the Purchase
Agreement (the “Deposit”), and (ii) notify Seller of the assignment of the
Purchase Agreement in accordance with Section 10.9 of the Purchase Agreement
promptly thereafter. Prior to or simultaneously with the closing of the purchase
and sale of the Property pursuant to the Purchase Agreement, Managing Member
shall (i) cause the Company to form a single purpose Delaware limited liability
company with the Company as the sole member (the “Mezzanine Borrower
Subsidiary”), (ii) cause the Mezzanine Borrower Subsidiary to form a single
purpose Delaware limited liability company with the Mezzanine Borrower
Subsidiary as the sole member (the “Property Owner Subsidiary” together with the
Mezzanine Borrower Subsidiary, each a “Subsidiary” and collectively, the
“Subsidiaries”), (iii) cause the Company to assign to the Property Owner
Subsidiary all right, title and interest of the Company under the Purchase
Agreement, including the Deposit, and (iv) notify Seller of the assignment of
the Purchase Agreement in accordance with Section 10.9 of the Purchase Agreement
promptly thereafter. Subject to Sections 2.02(d) and 2.02(e), the Company shall
cause the Property Owner Subsidiary to acquire the Property and assume the
Mortgage Loan (defined below) and the Mezzanine Borrower Subsidiary to assume
the Mezzanine Loan (defined below) at the closing thereunder (the “Property
Closing”) pursuant to the terms and conditions of the Purchase Agreement. The
Members contemplate that the name of the Property Owner Subsidiary will be 110
William Property Investors III, LLC and the name of the Mezzanine Borrower
Subsidiary will be 110 William Mezz III, LLC.
As used in this Agreement, the term the “Mortgage Loan” means that certain
mortgage loan in the original principal amount of $141,500,000 to be assumed by
the Property Owner Subsidiary at the Property Closing and secured by the Project
and the term “Mezzanine Loan” means that certain mezzanine loan in the original
principal amount of $20,000,000. The term “Loan” shall mean the Mortgage Loan
and the Mezzanine Loan and any refinance, modification, extension or
substitution of the Mortgage Loan or the Mezzanine Loan, or any new mortgage or
mezzanine loan affecting or pertaining to the Project.
1.04    Term of Company. The term of the Company shall commence on the date the
Certificate of Formation for the Company is filed with the Office of the
Delaware Division of Corporations and shall continue until dissolved pursuant to
Article VIII. The existence of the Company as a separate legal entity shall
continue until the cancellation of the Company’s Certificate of Formation.
ARTICLE II
MANAGEMENT OF THE COMPANY
2.01    Management of the Company.
(a)    General. JV Member is hereby designated as the managing member (the
“Managing Member”) of the Company and shall serve as Managing Member of the
Company unless and until it resigns or is removed pursuant to Section 2.06.
Subject to the restrictions set forth in this Agreement, Managing Member shall
manage and administer the day-to-day business and affairs of the Company.
Managing Member shall at all times faithfully perform its duties and
responsibilities in compliance with all applicable laws, the Business Plan, the
Annual Budget, the Leasing Guidelines (as each such term is defined below), and
this Agreement, and in

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an efficient, thorough, businesslike manner, devoting such time, efforts and
managerial resources to the business of the Company as is reasonably necessary
for the operation of the day-to-day business and affairs of the Company. In the
performance of its duties in this Agreement, Managing Member shall regularly
consult with the Members. Managing Member may engage in business efforts and
affairs which are not related to the Company, and will not be precluded from
owning and operating other businesses and/or real estate projects and neither
the Company nor the other Members shall have any right to participate in such
businesses or real estate projects.
(b)    Specific Day to Day Duties. Without limiting the generality of the
foregoing, Managing Member shall perform the following duties with respect to
the Project, all to be carried out in accordance with this Agreement, the Annual
Budget, the Business Plan and the Leasing Guidelines:
(i)    Use reasonable commercial efforts to obtain and cause to be maintained
all governmental and agency approvals, permits and other entitlements necessary
for ownership, operation, management and leasing of the Project.
(ii)    Coordinate the services of all employees, supervisors, architects,
engineers, accountants, attorneys, real estate brokers, advertising personnel
and other persons necessary or appropriate for the ownership, operation,
management and leasing of the Project.
(iii)    Supervise the performance of all work in connection with the ownership,
operation, management and leasing of the Project.
(iv)    Use reasonable efforts to enforce all of the Company’s rights and cause
performance of all of the Company’s obligations arising in connection with any
contract or agreement entered into in connection with the Project, excluding de
minimis obligations where the cost to pursue the obligation exceeds the benefit
to be gained.
(v)    Deliver to the Members copies of any material written notices or material
document received by Managing Member in connection with any material dispute or
material claims relating to the Project.
(vi)    Otherwise diligently perform those duties and services that are
reasonably necessary in order to acquire, own, operate, manage and lease the
Project in accordance with the Business Plan, the Annual Budget, the Leasing
Guidelines and this Agreement, except to the extent that the Company or a
Subsidiary has entered into an agreement with any other person to provide such
services in accordance with the terms of this Agreement, including without
limitation any Management Agreement or Leasing Agreement.
(c)    Additional Duties. Without limiting the generality of the foregoing,
Managing Member shall have the following additional duties with respect to the
overall operation of the Company and the ownership by the Company of the
Project, all to be carried out in accordance with this Agreement:

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(i)    Provide operating reports and financial statements in accordance with
Article IX.
(ii)    Notify the Members of such matters and render such reports to the
Members from time-to-time as any Member may reasonably request in writing,
including, without limitation, at all times and no less frequently than monthly
keeping the Members informed of material information relating to the Project by
notifying the Member in advance of public hearings and other proceedings
relating to any existing or proposed entitlements, mapping, subdivision or
material permits for the Project.
(iii)    Notify the Members of any bona fide offer to purchase the Project or
any term sheet or letter of intent relating thereto.
(iv)    Complying with, or causing the Company to comply with, the Leasing
Guidelines, as they may be modified pursuant to Section 2.12.
(v)    Complying with, or causing the Company to comply with, the Annual Budget,
as it may be modified pursuant to Section 2.10; provided, however, that Managing
Member shall be entitled to incur expenditures not provided in the Annual Budget
which (A) do not exceed (1) the sum of $100,000 as to any single expenditure,
and (2) the sum of $250,000 as to any such expenditures in the aggregate for any
calendar year (such expenditures may hereinafter be referred to as the “De
Minimis Expenditures”), or (B) constitute Emergency Expenditures pursuant to
Section 2.10(c).
(d)    Affiliate Agreements; Special Powers of KBS Regarding Affiliate
Agreements.
(i)    JV Member may not cause the Company to enter into any Affiliate Agreement
or amend, modify or terminate any such Affiliate Agreement after the entry by
the Company into such Affiliate Agreement without the prior consent of
Co-Managing Member.
(ii)    Notwithstanding anything to the contrary contained herein but subject to
Section 2.06(d) below, Co-Managing Member shall have the right, in its sole but
reasonable discretion upon prior written notice to JV Member, to take all
actions on behalf of the Company with respect to: (A) the determination of the
existence of any default by any Affiliate of JV Member under any Affiliate
Agreements made between the Company and any Affiliate of JV Member, (B) the
enforcement of all rights and remedies of the Company under any Affiliate
Agreements made between the Company and any Affiliate of any JV Member, and (C)
termination of any Affiliate Agreements made between the Company and any
Affiliate of any JV Member (subject to the terms and conditions set forth
therein for notice of defaults and applicable cure periods). JV Member will
cooperate in good faith with Co-Managing Member in the exercise by Co-Managing
Member of the foregoing rights and actions hereunder.
(iii)    As used in this Agreement, the term “Affiliate” means any person or
entity which, directly or indirectly through one (1) or more intermediaries,
controls or

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is controlled by or is under common control with another person or entity. The
term control as used herein (including the terms “controlling,” “controlled by,”
and “under common control with”) means the possession, direct or indirect, of
the power (i) to vote fifty-one percent (51%) or more of the outstanding voting
securities of such person or entity, or (ii) to otherwise direct management
policies of such person by contract (at commercially reasonable rates) or
otherwise. The term “Affiliate Agreement” means any agreement for the provision
of goods and/or services between the Company and any Affiliate of any Member or
any other person or entity in which such Member (or any person or entity having
a direct or indirect interest therein) owns a direct or indirect interest
therein.
2.02    Major Decisions. Notwithstanding anything contained in this Agreement to
the contrary, Managing Member shall not take, or cause or permit the Company to
enter into any agreement to take, any of the following actions on behalf of the
Company or with respect to the Project (in each case the taking of which
hereinafter shall be referred to as a “Major Decision”) without the prior
written consent of the other Member(s) (except as otherwise expressly provided
below in Section 2.06(d)), which may be given or withheld in each such Member’s
sole and absolute discretion. Nothing in this Agreement shall prevent
Co-Managing Member from proposing a Major Decision.
(a)    Annual Budget; Business Plan. Subject to Sections 2.01(c)(v) and 2.10,
deviate from, amend or replace the Business Plan or deviate from, amend or
replace the Annual Budget, after the Business Plan and the Annual Budget has
been approved pursuant to this Section 2.02(a).
(b)    Sale of the Company or the Project. Subject to Articles VI and VII, sell,
convey, exchange, hypothecate, pledge, encumber or otherwise transfer any
portion of or any interest in the Company or the Project, or enter into any
agreement to sell, convey, exchange, hypothecate, pledge, encumber or otherwise
transfer any portion or any interest in the Company or the Project.
(c)    Management and Leasing Agreements. Enter into, amend, modify, terminate,
or waive any rights under, any Management Agreement or any Leasing Agreement (as
such terms are defined below), or enter into any replacement management
agreement or leasing agreement.
(d)    Acquire Real Property. Purchase or otherwise acquire any interest in real
property other than the Company’s interest in the Project pursuant to the
Purchase Agreement.
(i)    Prior to the date hereof, Managing Member has delivered to Co-Managing
Member all of the “Buyer’s 3-14 Audit Documents” (as defined in the Purchase
Agreement) with respect to calendar year 2013 through and including the month of
November, and Co-Managing Member acknowledges receipt of the same. Co-Managing
Member has notified Managing Member that Co-Managing Member will need the
Buyer’s 3-14 Audit Documents for the month of December 2013 in a form and
content substantially similar to the Buyer’s 3-14 Audit Documents previously
delivered to Co-Managing Member and may need additional supporting audit
documentation with

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respect to the Project. Managing Member (unless it is otherwise able to obtain
such supporting information) will use commercially reasonable efforts to enforce
the provisions of Section 9.7 of the Purchase Agreement (which requires, among
other things, Seller to reasonably cooperate with Contract Purchaser in
connection with any additional information or documentation Contract Purchaser
may require with respect to “Buyer’s 3-14 Audit” (as defined in the Purchase
Agreement)) to cause Seller to deliver such additional supporting documentation
to Co-Managing Member. Co-Managing Member shall promptly notify Managing Member
in writing after completion of the Buyer’s 3-14 Audit (the “3-14 Audit
Completion Notice”). If Co-Managing Member has not delivered a 3-14 Audit
Completion Notice on or before the earlier of (x) the second day following the
date that Managing Member notifies Co-Managing Member in writing that the Seller
has notified Contract Purchaser in writing that Seller will not deliver any
additional Buyer’s 3-14 Audit Documents or supporting audit documentation with
respect to the Project or (y) January 15, 2014, Managing Member shall have the
right to elect to have Co-Managing Member withdraw from the Company by
delivering written notice to Co-Managing Member (a “Withdrawal Notice”) at any
time thereafter so long as Co-Managing Member has not delivered a 3-14 Audit
Completion Notice. If Co-Managing Member is unable to complete the Buyer’s 3-14
Audit, Co-Managing Member shall have the right to withdraw from the Company by
delivering a Withdrawal Notice to Managing Member.
(ii)    Notwithstanding anything to the contrary in this Agreement, if a
Withdrawal Notice is delivered pursuant to Section 2.02(d)(i), then the
following shall apply: (A) within five (5) days after the delivery of a
Withdrawal Notice, Managing Member shall contribute nine million dollars
($9,000,000) to the Company and shall cause the Company to return to Co-Managing
Member its initial capital contribution in the amount of nine million dollars
($9,000,000); (B) upon or concurrent with the funding described in clause (A),
the Members shall execute such documentation as may be necessary to evidence
Co-Managing Member’s withdrawal from the Company and release of Co-Managing
Member from all liabilities and obligations of the Company; (C) after
Co-Managing Member’s receipt of its initial capital contribution and withdrawal
from the Company pursuant to clauses (A) and (B), (1) Co-Managing Member shall
have no further right, title or interest in the Company, (2) Managing Member
shall dissolve the Company pursuant to Article VIII hereof, and (3) Managing
Member and/or its affiliates shall be free, in its/their sole and absolute
discretion, to pursue the acquisition of the Project and the assumption of the
Mortgage Loan and the Mezzanine Loan to the exclusion of Co-Managing Member.
Managing Member’s obligation to contribute nine million dollars ($9,000,000) to
the Company pursuant to clause (A) above shall be guaranteed by the Savanna
Credit Party (defined below).
(e)    Loan Assumption; Required Changes in Loan Documents. Determine whether
the loan assumption contingency set forth in Section 9.6 of the Purchase
Agreement has been satisfied; provided that neither Co-Managing Member nor
Managing Member shall have the right to determine that such loan assumption
contingency has not been satisfied unless such Member has determined, in its
sole but reasonable discretion, that there has been a Material Adverse Loan
Modification. “Material Adverse Loan Modification” shall mean (x) a failure

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of the Loan Assumptions and/or the Assumption Agreement(s) (as such terms are
defined in the Purchase Agreement) to satisfy the loan assumption contingency
set forth in Section 9.6 of the Purchase Agreement, (y) a conditioning of the
Loan Approval on one or more modifications to the loan documents that are
reasonably expected to have an adverse economic impact to such Member or any
Affiliate of such Member or a requirement that Co-Managing Member or any
Affiliate of Co-Managing Member execute a guaranty or an indemnity in favor or
either lender, or (z) the failure of the loan documents to permit transfers and
actions on terms set forth on Exhibit H attached hereto. If there has been a
determination of a Material Adverse Loan Modification, and:
(i)    If both Members have elected in writing not to effect the Loan
Assumptions, Managing Member shall deliver to Seller a termination notice under
Section 9.6 of the Purchase Agreement and seek a return of the Deposit (as such
term is defined under the Purchase Agreement) and thereafter cause the Company
to be dissolved pursuant to Article VIII.
(ii)    If Managing Member has notified Co-Managing Member in writing that it
desires to effect the Loan Assumptions, but Co-Managing Member has notified
Managing Member in writing of its disapproval of the same and its desire to
terminate the Purchase Agreement, then Managing Member shall have the right, in
its sole and absolute discretion to elect to (A) deliver to Seller a termination
notice under Section 9.6 of the Purchase Agreement and seek a return of the
Deposit, or (B) deliver written notice to Co-Managing Member requiring
Co-Managing Member to withdraw from the Company. If Managing Member elects to
deliver a notice pursuant to clause (B), then the provisions of Section
2.02(d)(ii) shall apply as if such notice were a Withdrawal Notice delivered
pursuant to Section 2.02(d)(i).
(iii)    If Managing Member has notified Co-Managing Member in writing that it
desires not to effect the Loan Assumptions and to terminate the Purchase
Agreement, but Co-Managing Member has notified Managing Member in writing of its
approval of the same, then Co-Managing Member shall have the right, in its sole
and absolute discretion to elect to (x) have Managing Member deliver to Seller a
termination notice under Section 9.6 of the Purchase Agreement and seek a return
of the Deposit, or (y) elect to have Managing Member withdraw from the Company
and pursue the acquisition of the Project (the “Takeover Notice”). If
Co-Managing Member elects to deliver a Takeover Notice pursuant to clause (y),
then then the following shall apply: (A) within five (5) days after the delivery
of a Takeover Notice, Co-Managing Member shall contribute six million dollars
($6,000,000) to the Company and Managing Member shall cause the Company to
return to Managing Member its initial capital contribution in the amount of six
million dollars ($6,000,000); (B) upon or concurrent with the funding described
in clause (A), the Members shall execute such documentation as may be necessary
to evidence Managing Member’s withdrawal from the Company and release of
Managing Member from all liabilities and obligations of the Company; (C) after
Managing Member’s receipt of its initial capital contribution and withdrawal
from the Company pursuant to clauses (A) and (B), (1) Managing Member shall have
no further right, title or interest in the Company, (2) if the Company or a
Subsidiary of the Company is not the contract purchaser under the Purchase
Agreement, Managing Member shall

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assign all the right, title and interest of the Contract Purchaser to such
entity as Co-Managing Member may direct, (3) Co-Managing Member shall dissolve
the Company pursuant to Article VIII hereof, and (4) Co-Managing Member and/or
its affiliates shall be free, in its/their sole and absolute discretion, to
pursue the acquisition of the Project and the assumption of the Mortgage Loan
and the Mezzanine Loan to the exclusion of Managing Member. Co-Managing Member’s
obligation to contribute six million dollars ($6,000,000) to the Company
pursuant to clause (A) above shall be guaranteed by the KBS Credit Party
(defined below).
(f)    Financing. Cause the Company to finance or refinance the operations of
the Company and/or any of the Company’s assets or retain any mortgage bankers or
brokers on behalf of the Company in connection therewith or enter into any
modifications, amendments, extensions, substitutions or other agreements
regarding the Loan or to refinance the Loan. Co-Managing Member’s underwriting
of the Project assumes that the Loan will not be refinanced more than 90 days
before its maturity date. Accordingly, unless Co-Managing Member expressly
approves an earlier refinance of the Loan as a Major Decision, Managing Member
will not seek an early refinance of the Mortgage Loan but may present potential
refinancing options of the Mezzanine Loan to Co-Managing Member provided that
any such potential refinancing shall, however, remain a Major Decision.
(g)    Indemnity. Make, execute or deliver on behalf of the Company any
indemnity bond or surety bond or obligate the Company or any other Member as a
surety, guaranty, guarantor or accommodation party to any obligation or grant
any lien or encumbrance on any of the assets of the Company, including the
Project, except for the Mortgage Loan and Mezzanine Loan assumed by the
Subsidiaries, as applicable, at the Property Closing pursuant to the terms of
this Agreement.
(h)    Loans. Lend funds belonging to the Company to any Member or its Affiliate
or to any third party, or extend any person, firm or corporation credit on
behalf of the Company, in each case, except as expressly permitted by this
Agreement, or cause any Member Loan to be made to the Company as provided in
Section 3.03.
(i)    Distributions. Based on cash flow projections and analysis prepared by
Managing Member, determine whether or not there is sufficient Net Cash so that
distributions may be made to the Members in accordance with this Agreement, and
make any distribution to the Members. As used in this Agreement, the term “Net
Cash” means the gross cash receipts of the Company from all sources as of any
applicable date of determination, less the portion thereof used to pay: (i) all
cash disbursements (inclusive of any guaranteed payment within the meaning of
Section 707(c) of the Code paid to any Member, including, without limitation,
any reimbursements made to any Member and any amounts applied to repay any
Member Loans or Default Loans, of the Company prior to that date); and (ii) all
reserves, established by the Annual Budget, a lender or otherwise approved by
the Members for anticipated cash disbursements, including for payment of debt
service, escrows, capital improvements and other anticipated contingencies and
expenses of the Company.
(j)    Expenditures. Except for De Minimis Expenditures or Emergency
Expenditures permitted under this Agreement, take any action or make any
expenditure or incur

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any obligation by or on behalf of the Company which is not included in the
Annual Budget (including, without limitation, obligating the Company to pay for
any goods or services in excess of the foregoing). In the event that the Loan is
within ninety (90) days of its stated maturity, or after its term has expired,
or is in default, Managing Member may not reallocate any excess funds among line
items or make any expenditures from any reserves without the consent of the
Members.
(k)    Duties. Delegate any of the duties of Managing Member set forth herein
except as set forth in the Management Agreement, any Leasing Agreement or any
other approved Affiliate Agreement under the terms of this Agreement or to the
officers and employees of Managing Member.
(l)    Assignment Benefiting Creditors. Make, execute or deliver on behalf of
the Company an assignment for the benefit of creditors; file, consent to or
cause the Company, a Member’s Interest, or the Project, or any part thereof or
interest therein, to be subject to the authority of any trustee, custodian or
receiver or be subject to any proceeding for bankruptcy, insolvency,
reorganization, arrangement, readjustment of debt, relief of debtors,
dissolution or liquidation or similar proceedings.
(m)    Partition of Company Assets. Partition all or any portion of the assets
of the Company, or file any complaint or institute any proceeding at law or in
equity seeking such partition.
(n)    Governmental Proposals. Make application to, or enter into any agreements
with, any government officials relating to mapping, development, zoning,
subdivision, environmental or other land use or entitlement matters which may
affect the Project.
(o)    Purchase Assets. Except as may be provided in the then-applicable Annual
Budget, purchase any automobiles or vehicular equipment on behalf of or in the
name of the Company or purchase any fixed assets on behalf of or in the name of
the Company.
(p)    Confess Judgments; Legal Actions. Confess a judgment against the Company,
settle or adjust any claims against the Company, or commence, negotiate and/or
settle any legal actions or proceedings brought by the Company against
unaffiliated third parties; provided, however, that Managing Member may settle
or adjust any claim which is not the subject of a legal action or proceeding of
$100,000 or less.
(q)    Dissolve the Company. Except as provided in this Agreement, dissolve,
terminate or liquidate the Company prior to the expiration of the term.
(r)    Acts Making Business Impossible. Do any act that would make it impossible
to carry on the business of the Company.
(s)    Material Agreements. Except as provided in the Annual Budget or in the
express terms of this Agreement, cause the Company to enter into any agreement
obligating the Company to pay an amount of more than $100,000 and any amendment,
modification or termination of any such agreement, including, without
limitation, any agreement providing for

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the payment of any commission, fee or other compensation payable in connection
with the sale of all or any portion of the Project.
(t)    Leases. Deviate from, amend or replace the Leasing Guidelines. Cause or
permit the Company to enter into any new lease affecting the Project unless such
lease is on the standard form of lease approved by the Members with economic
terms consistent with the then-current Leasing Guidelines approved by the
Members, or amend, modify, terminate, or waive rights under any existing leases
except in the ordinary course of business consistent with the Leasing
Guidelines.
(u)    Insurance; Accounting. Change the insurance program for the Company or
the Project in a manner inconsistent with the Business Plan or inconsistent with
the insurance requirements set forth in Section 2.05 or alter or change the
reporting, accounting and/or auditing systems and/or procedures for the Company
or the Project.
(v)    Employees. Employ any individuals as an employee of the Company or of any
Subsidiary.
(w)    Awards and Proceeds. Except as required by the Loan, apply or dispose of
any casualty insurance proceeds or any condemnation award, or settle with any
insurance company or any condemning authority, as applicable.
(x)    No REIT Prohibited Transactions. Take, or permit to be taken, any action
that is or results in a REIT Prohibited Transaction.
(y)    Pledge and Assignment. Subject to the provisions of Article VI, sell,
transfer or pledge any Member’s interests in the Company.
(z)    Consultants. Retain or dismiss on behalf of the Company any accountants,
auditors, property managers or leasing agents; provided, however, that the
Members hereby approve Swig Equities as property manager; Savanna Project
Management as project manager; and Savanna Commercial Services, CB Richard
Ellis, Jones Lang LaSalle, Newmark Grubb Knight Frank, and Cushman Wakefield, as
potential leasing agents.
(aa)    Additional Capital Contributions. Except as expressly set forth in
Section 3.01 or otherwise approved by the Members in writing, require any
additional capital contributions of the Members.
(bb)    Member Loans. Except as expressly set forth in Section 3.03 or otherwise
approved by the Members in writing, require or request any Member Loan.
(cc)    Subsidiaries. Allow or cause any Subsidiary to take any of the actions
that constitute Major Decisions hereunder.
The Members agree that the Major Decisions set forth in this Section 2.02
require the prior written consent of each Member in its sole and absolute
discretion (except as otherwise expressly provided in Section 2.02(e) and
2.06(d)). Subject to Section 2.06(d) and excepted as provided in Sections
2.02(d) and (e), failure by any Member to approve any Major Decision in

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writing within ten (10) days after such Member’s receipt of a request therefor
from Managing Member shall be deemed a disapproval of such Major Decision.
2.03    Company Funds. No Company funds, assets, credit or other resources of
any kind or description shall be paid to, or used for, the benefit of any
Member, except as specifically provided in this Agreement or the Annual Budget
or after the written approval of all the Members has been obtained. All funds of
the Company shall be deposited only in such federally insured checking and
savings accounts of the Company in the Company name with banks and other
financial institutions having not less than $1,000,000,000 in assets as the
Members shall approve in writing, shall not be commingled with funds of any
other person or entity, and shall be withdrawn only upon such signature or
signatures as may be designated in writing from time to time by Managing Member
after receiving approval of the Members.
2.04    Employees. Neither the Company, nor the Subsidiaries shall have
employees. Each Member shall be solely responsible for all wages, benefits,
insurance and payroll taxes with respect to any of its respective employees.
Each Member agrees to perform its duties under this Agreement as an independent
contractor and not as the agent, employee or servant of the Company. Each Member
shall be solely responsible for its own acts and those of its subordinates,
employees and agents during the term of this Agreement and, subject to, and
without the waiver of the benefits of, the provisions of Section 2.09, each
Member hereby indemnifies and holds harmless the Company and each other Member
from any liabilities, damages, costs and expenses (including, without
limitation, reasonable attorneys’ fees) arising from the acts of any such
subordinates, employees and agents of such Member.
2.05    Insurance.
(a)    Company Policies. Managing Member shall purchase and maintain, or shall
cause to be purchased and maintained, for and at the expense of the Company,
policies of insurance (i) for the Company’s operations, (ii) for the protection
of the Company’s assets (including the Project), and (iii) as may be reasonably
required to comply with third-party requirements in accordance with guidelines
approved by the Members, and shall provide the Members upon request with the
certificates or other evidence of insurance coverage as provided therein. All
such insurance shall be maintained in such amounts, in forms and with such
insurance companies as shall be reasonably satisfactory to each of the Members,
but in limits no less than as set forth herein. The Company’s insurance terms
and limits shall include the following: (A) all risk property and builders risk
insurance in amounts at least equal one hundred percent (100%) of the full
replacement costs of the work, including, but not limited to, all improvements
to the Property without any co-insurance requirements or penalties; (B) general
liability and umbrella insurance with a per occurrence and annual aggregate
limit of no less than $10,000,000 per location / project; and (C) if applicable,
worker’s compensation insurance in compliance with statutory requirements of the
state(s) in which the employee resides, is hired and in which the services are
being performed, and employer’s liability insurance in the amount of $500,000
each accident for bodily injury by accident, $500,000 each employee for bodily
injury by disease, and $500,000 policy limit for bodily injury by disease, or
such other amount as may be required by umbrella policy to effect umbrella
coverage.

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(b)    Contractor’s Insurance Obligations. Managing Member shall require the
Project’s general contractors and all subcontractors to obtain and maintain at
all times during performance of work for the Company an occurrence form
commercial general liability policy on a primary and non-contributing basis with
a minimum of $1,000,000 per occurrence/$2,000,000 annual aggregate per location
/ project and an umbrella / excess liability in the minimum amount of $5,000,000
per location / project, or in such other amounts as may be approved by the
Members, on which the Company is named as an additional insured. In addition,
Managing Member shall require that the Project’s general contractors and all
subcontractors carry worker’s compensation coverage as required by law,
including a waiver of subrogation in favor of the Company.
(c)    D&O Insurance. Managing Member may purchase and maintain insurance on
behalf of the executive officers of Managing Member (and if requested by any
Member, executive officers of such Member) against liability asserted against
such Person and incurred by such Person arising out of such Persons’ actions on
behalf of Managing Member (or any other Member, as applicable) under this
Agreement; provided that the cost of such insurance is included in the approved
Annual Budget for the applicable year and such coverage is available at
commercially reasonable rates.
(d)    Other. The insurance required herein may be issued as blanket insurance,
provided the required coverages are not diminished by such blanket policies. All
policies shall be written on such terms, in such form and for such periods and
amounts as the Company shall from time to time reasonably designate or approve,
shall be primary and without right of contribution from other insurance which
may be available, shall waive any right of set off, counterclaim or subrogation,
shall provide that the insurance shall not be invalidated by any action or
inaction by the Managing Member, and shall provide that they shall not be
canceled or amended without at least thirty (30) days’ prior written notice to
the Company.
2.06    Election, Removal, Resignation.
(a)    Number, Term and Qualifications. The Company shall have one Managing
Member, which shall initially be JV Member. Other than in circumstances in which
Managing Member is removed pursuant to Section 2.06(b) or resigns pursuant to
Section 2.06(c), as applicable, a new Managing Member may not be appointed
except as set forth in Section 2.06(d). Managing Member shall be a Member, but
need not be an individual, a resident of the state in which the Property is
located, or a citizen of the United States.
(b)    Removal. Subject to this Section 2.06(b), JV Member may be removed as
Managing Member (but not as a Member) solely as a result of the occurrence of a
Just Cause Event at any time after KBS delivers written notice (a “Removal
Notice”) to JV Member after the occurrence of a Just Cause Event (subject to
applicable notice and cure periods set forth below) (the date of any such
removal, the “Removal Date”).
For purposes of this Section 2.06(b), “Just Cause Event” shall mean:
(i)    JV Member or any principal, officer, executive or employee of JV Member
or Savanna Investment Management LLC, has committed fraud related to the

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Company or the Project, or has embezzled Company funds or funds related to the
Project, provided that, in the case of embezzlement or fraud, if within ten (10)
Business Days after such embezzlement or fraud is discovered, (a) such funds are
replaced, and, (b) if such embezzlement or fraud is committed by an individual
other than Christopher Schlank or Nicholas Bienstock, such individual is
terminated, then such occurrence shall not be a Just Cause Event.
(ii)    JV Member or any principal, officer, executive or employee of JV Member
or Savanna Investment Management LLC has committed an act of gross negligence or
willful misconduct (other than an act or conduct described in clause (i) above)
in connection with the performance by JV Member of its obligations under this
Agreement that has had a material adverse effect on the Company and its
Subsidiaries taken as a whole.
(iii)    JV Member has breached its material obligations as Managing Member
under this Agreement and such breach was not timely cured within thirty (30)
days of JV Member’s receipt of written notice from Co-Managing Member; provided,
however, that in no event shall JV Member be determined to have materially
breached its obligations as Managing Member under this Agreement if Co-Managing
Member shall have consented in writing to such action or inaction.
(iv)    The filing a petition for relief under the United States Bankruptcy
Code, as amended, by JV Member, making an assignment for the benefit of
creditors, applying for the appointment of a custodian, receiver or trustee for
JV Member or any of its respective assets, consenting to any other bankruptcy or
similar proceeding, or consenting to the filing of such proceeding; provided,
however, that in no event shall JV Member be determined to have violated this
provision if Co-Managing Member shall have consented in writing to such filing.
(v)    The failure of JV Member to fund any capital contributions as and when
required pursuant to Section 3.01(a) and such failure is not cured within ten
(10) days of written notice from Co-Managing Member; provided that no cure
period shall be required for JV Member’s failure to fund its required capital
contribution on or before the Property Closing.
(vi)    An event of default occurs under the Loan (other than an act or conduct
described in clause (vii) below), after all applicable notice and cure rights
have expired, that results from a failure, violation or breach of the Company or
any guarantor or indemnitor of the Loan to perform and observe any covenant,
condition, representation or warranty under any document evidencing or securing
the Loan; provided, however, that it shall not be a Just Cause Event if (A) the
event of default in question is a result of the Company having insufficient
funds or revenues due to the performance of the Property or (B) the Members have
consented in writing to any such conduct, action or inaction or failure,
violation or breach.
(vii)    An event of default occurs under the Loan, after all applicable notice
and cure rights have expired, that results from any conduct or action taken by
JV

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Member as Managing Member, any JV Member Principal or an Affiliate of JV Member
that is in violation of a Required Guaranty (defined below); provided, however,
that it shall not be a Just Cause Event if (A) the event of default in question
is a result of the Company having insufficient funds or revenues due to the
performance of the Property or (B) the Members have consented in writing to any
such conduct, action or inaction or failure, violation or breach.
(c)    Resignation. Managing Member may resign as Managing Member (but not as a
Member) upon ten (10) days prior notice to the other Member.
(d)    Effect of Removal or Resignation. Upon the removal or resignation of JV
Member as Managing Member in accordance with Section 2.06(b) or Section 2.06(c),
as applicable, Co-Managing Member (or its designee) may:
(i)    terminate any Affiliate Agreement with an Affiliate of JV Member; and
(ii)    replace JV Member as Managing Member with itself (or its designee) which
successor Managing Member shall have all of the duties and obligations of
Managing Member under this Agreement.
In addition, upon the removal of JV Member as Managing Member in accordance with
Section 2.06(b), the prior written consent of JV Member shall not be required
for: (1) Major Decisions, (2) the right to approve the Annual Budget or Business
Plan pursuant to Section 2.10, (3) the right to approve the agreements described
in Section 2.11 if such agreements are not with an Affiliate of KBS, and (4) the
right to approve changes to the Leasing Guidelines pursuant to Section 2.12;
provided, however, that the JV Member’s prior written consent shall be required
for Major Decisions under (1) Section 2.02(b) [Sale of Company or the Project]
and (d) [Acquire Real Property], (2) Section 2.02(f) [Financing] if and only if
the financing or refinance would either (A) require additional capital
contributions from JV Member or a guaranty from JV Member, (3) Section 2.02(l)
[Assignment Benefitting Creditors], (4) Section 2.02(m) [Partition of Company
Assets], (5) Section 2.02(q) [Dissolve the Company], (6) Section 2.02(r) [Acts
Making Business Impossible], (7) Section 2.02(s) [Material Agreements] if and
only if such agreements are with an Affiliate of KBS, (8) Section 2.02(aa)
[Additional Capital Contributions] and (9) Section 2.02(cc) [Subsidiaries] with
respect to the Major Decisions enumerated in the preceding clauses (1) through
(8).
(e)    Effect of Just Cause Event. Irrespective of whether Co-Managing Member
elects to replace JV Member as Managing Member, JV Member shall be responsible
for all claims, damages, losses, costs and expenses (“Claims”) incurred by the
Company as a result of the occurrence of (i) a Just Cause Event or (ii) an act
of gross negligence or willful misconduct described in Section 2.06(b)(ii) even
if such act does not constitute a Just Cause Event (i.e., such act does not have
a material adverse effect), and shall reimburse the Company for such Claims
within ten (10) days of the Company’s written request therefor, which request
shall reasonably substantiate the Claims incurred. The Savanna Credit Party
(defined below) shall guaranty JV Member’s payment of the Claims under this
Section 2.06(e).

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2.07    Members Have No Managerial Authority. The Members shall have no power to
participate in the management of the Company, except as expressly authorized by
this Agreement.
2.08    Meetings. The Company shall not be required to hold regular meetings of
Members. Any Member may call a meeting of Members for the purpose of discussing
Company business. Unless otherwise approved by the Members, any meeting of
Members shall be held during normal business hours either telephonically or in
person at the Company’s principal office on such day and at such time as are
reasonably convenient for the Members.
2.09    Liability and Indemnity. No Member, Managing Member or Tax Matters
Partner (nor any officer, director, member, manager, constituent partner, agent
or employee of the Company or a Member, Managing Member or Tax Matters Partner)
shall be liable or accountable in damages or otherwise to the Company or to any
other Member, Managing Member or Tax Matters Partner for any good faith error of
judgment or any good faith mistake of fact or law in connection with this
Agreement, or the services provided to the Company except in the case of willful
misconduct or gross negligence. To the maximum extent permitted by law, the
Company does hereby indemnify, defend and agree to hold each Member , Managing
Member or Tax Matters Partner (and each such officer, director, member, manager,
constituent partner, agent or employee of a Member, Managing Member or Tax
Matters Partner) wholly harmless from and against any loss, expense or damage
(including, without limitation, reasonable attorneys’ fees and costs) suffered
by such Member, Managing Member or Tax Matters Partner (and/or such officer,
director, member, manager, constituent partner, agent or employee of a Member,
Managing Member or Tax Matters Partner) by reason of anything which such Member
(and/or such officer, director, member, manager, constituent partner, agent or
employee of a Member, Managing Member or Tax Matters Partner) may do or refrain
from doing hereafter for and on behalf of the Company and in furtherance of its
interest; except in the case of willful misconduct or gross negligence in
performing or failing to perform its duties hereunder. To the maximum extent
permitted by law, each Member, Managing Member or Tax Matters Partner does
hereby indemnify, defend and agree to hold the Company and each other Member,
Managing Member or Tax Matters Partner wholly harmless from and against any
loss, expense or damage (including, without limitation, reasonable attorneys’
fees and costs) suffered by the Company or such other Member, Managing Member or
Tax Matters Partner as a result of such indemnifying person’s willful misconduct
or gross negligence in performing or failing to perform such indemnifying
person’s duties hereunder.
2.10    Business Plan and Budget. Prior to the Property Closing, the Members
shall have approved a plan prepared by Managing Member setting forth the general
description of the overall business plan of the Company with respect to the
Project (the “Business Plan”). The initial Business Plan shall cover the first
two (2) year period of the Company’s existence. Notwithstanding the approval of
such Business Plan by the Members, in the event of any conflict or inconsistency
between any provision of the Business Plan and any provision of this Agreement,
the provisions of this Agreement shall control and supersede the provisions of
the Business Plan. On or before the Update Date (defined below) in any year,
Managing Member shall prepare an update and any other necessary modifications to
the Business Plan for the review and approval of the Members.

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(a)    Annual Budget. Attached hereto as Exhibit D is the annual budget
existence in connection with the ownership, operation, and leasing of the
Project (the “Annual Budget”) prepared by Managing Member and approved by
Co-Managing Member for the first two (2) year period of the Company’s. On or
before November 15, 2015, and on or before the first business day of November of
each year thereafter (each an “Update Date”), Managing Member shall prepare a
new Annual Budget which shall be required to be approved by the Members, which
shall set forth, by individual category, the costs and expenses projected to be
incurred by the Company for the ensuing fiscal year.Interim Annual Report. If
any Annual Budget, or any category thereof, is not approved by the Members for
any fiscal year as of the commencement of such fiscal year (or other period),
then the approved categories of the proposed Annual Budget shall be in effect,
but as to the categories which were disapproved, one hundred five percent (105%)
of the last approved Annual Budget line items, shall be in effect until the
Members approve the new Annual Budget as to such categories. Adjustments to the
last approved Annual Budget shall automatically be made to reflect actual
increases in real property taxes, insurance premiums, utility charges and
payments required under contracts to which the Company is a party at the time of
the expiration of the Annual Budget, and shall not require the consent of any
Member.
(b)    Reallocation. Managing Member shall be permitted to reallocate amounts
set forth in particular line items on the Annual Budget to the extent that the
Managing Member reasonably determines that savings are expected with respect to
any such line item.
2.11    Management and Leasing Agreements.
(a)    Management Agreement. At or before the Property Closing, the Company
shall cause the Property Owner Subsidiary to enter into a property management
agreement (the “Management Agreement”) in form and substance acceptable to the
Members with a property manager (the “Property Manager”) approved by Members.
The Management Agreement shall be substantially on Co-Managing Member’s form and
shall provide, among other things, for a right to terminate Property Manager
without cause upon thirty (30) days written notice (it being understood that
such termination may result in the payment of a fee to Property Manager if and
to the extent provided in the Management Agreement) and that a Sarbanes-Oxley
qualified entity acceptable to Co-Managing Member shall provide accounting
services for the Project (which may be provided pursuant to a separate agreement
or a sub-management agreement in each case in form and substance acceptable to
Co-Managing Member). Swig Equities, LLC, an Affiliate of JV Member, is approved
as the initial Property Manager so long as Swig Equities, LLC subcontracts
certain accounting services with a Sarbanes-Oxley qualified accounting firm

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acceptable to Co-Managing Member pursuant to an accounting services agreement
acceptable to Co-Managing Member. The fee payable to Property Manager shall be
as set forth in the Management Agreement.
(b)    Leasing Agreement. At or before to the Property Closing, Company shall
cause the Property Owner Subsidiary to enter into a leasing agreement (the
“Leasing Agreement”) in form and substance acceptable to the Members with a
leasing agent approved by the Members. The Leasing Agreement shall be
substantially in the form attached hereto as Exhibit E. Savanna Commercial
Services LLC, an Affiliate of JV Member, is approved as the leasing agent.
(c)    Renewal Leasing Agreement. At or before to the Property Closing, Company
shall cause the Property Owner Subsidiary to enter into a renewal leasing
agreement (the “Renewal Leasing Agreement”) in form and substance acceptable to
the Members with a leasing agent approved by the Members. The Leasing Agreement
shall be substantially in the form attached hereto as Exhibit F. Savanna
Commercial Services LLC, an Affiliate of JV Member, is approved as the initial
renewal leasing agent.
(d)    Construction Management Agreement. At or before to the Property Closing,
Company shall cause the Property Owner Subsidiary to enter into a construction
management agreement (the “Construction Management Agreement”) in form and
substance acceptable to the Members with a construction management agent
approved by the Members. The Construction Management Agreement shall be
substantially in the form attached hereto as Exhibit G. Savanna Project
Management LLC, an Affiliate of JV Member, is approved as the initial
construction management agent.
2.12    Leasing Guidelines. Prior to the Property Closing, the Members shall
have approved leasing guidelines for the Project (the “Leasing Guidelines”)
setting forth the minimum approved rents, minimum required security and other
deposits, and the maximum free rent periods, concessions and finder’s fees that
are to be used for the leasing of the Project. If necessitated by market
changes, Managing Member shall prepare new Leasing Guidelines which shall be
required to be approved by the Members.
2.13    Reimbursements and Fees. Except as otherwise provided by this Agreement
or the management and leasing agreements described in Section 2.11, none of the
Members (or their respective Affiliates and/or other representatives) shall be
paid any compensation for rendering services to the Company. Each Member shall
be reimbursed for any costs and/or expenses incurred by such Member on behalf of
the Company that relate to the business and affairs of the Company to the extent
such Member had authority to act on behalf of the Company (without reduction to
such Member’s capital account in the Company maintained in accordance with
Treasury Regulations Section 1.704-1(b)(2)(iv) (each a “Capital Account”));
provided, however, that except as otherwise provided in this Agreement or in the
Annual Budget no Member shall be reimbursed for any such costs and/or expenses
that exceed an aggregate amount of $2,000 during any calendar year without
Member Approval. As used in this Agreement, the term: “Treasury Regulation”
means any proposed, temporary, and/or final federal income tax regulation
promulgated by the United States Department of the Treasury as heretofore and

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hereafter amended from time to time (and/or any corresponding provisions of any
superseding revenue law and/or regulation).
2.14    Reimbursement for Pre-Formation Costs. At or within five (5) business
days after the acquisition of the Project by the Company, the Company shall
reimburse KBS and JV Member for any and all legal and accounting fees,
organizational costs and any other formation and due diligence costs incurred by
KBS and JV Member (and/or any Affiliate or representative thereof) in connection
with the formation of the Company, the negotiation and documentation of this
Agreement and the acquisition of the Project. The foregoing reimbursements shall
not be debited to or otherwise reduce any Member’s Capital Account. KBS and JV
Member shall use good faith commercially reasonable efforts to cause all such
amounts to be reimbursed hereunder to be included in the Company’s final escrow
closing statement for the acquisition of the Project.
2.15    Limited Liability. Except as otherwise provided by the Act, the debts,
obligations and liabilities of the Company, whether arising in contract, tort or
otherwise, shall be solely the debts, obligations and liabilities of the
Company, and the Members shall not be obligated personally for any such debt,
obligation or liability of the Company solely by reason of being a Member of the
Company.
ARTICLE III
MEMBERS’ CONTRIBUTIONS TO COMPANY
3.01    Initial Capital Commitments.
(a)    JV Member. JV Member shall commit to contribute to the capital of the
Company, in cash, an aggregate amount equal to forty percent (40%) of the
initial equity necessary to acquire the Project and capitalize the Company,
which amount shall be contributed as follows: (i) upon the full execution of
this Agreement and subject to the full execution of the Purchase Agreement, JV
Member will contribute the sum of six million dollars ($6,000,000), which shall
be used as 40% of sum of the Deposit; and (ii) at the closing of the acquisition
of the Project, JV Member will contribute the balance of its capital
contribution in an amount equal to thirty-two million six hundred thirty-three
thousand five hundred eighty-four dollars ($32,633,584). JV Member’s initial
capital contribution is based on the sources and uses schedule attached hereto
as Exhibit C.
(b)    KBS. KBS shall commit to contribute to the capital of the Company, in
cash, an aggregate amount equal to sixty percent (60%) of the initial equity
necessary to acquire the Project and capitalize the Company which shall be which
shall be payable as follows: (i) upon the full execution of this Agreement and
subject to the full execution of the Purchase Agreement, KBS will contribute the
sum of nine million dollars ($9,000,000), which shall be used as 60% of the sum
of the Deposit; and (ii) at the closing of the acquisition of the Project, KBS
will contribute the balance of its capital contribution in an amount equal to
forty-eight million nine hundred fifty thousand three hundred seventy-six
dollars ($48,950,376). Co-Managing Member’s initial capital contribution is
based on the sources and uses schedule attached hereto as Exhibit C.

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For avoidance of doubt, KBS and JV Member acknowledge that the Contract
Purchaser funded the entire amount of the Deposit under the Purchase Agreement
and that the Members initial capital contributions described in Sections
3.01(a)(i) and Section 3.01(b)(i) will be used to reimburse the Contract
Purchaser for such amounts as part of the assignment of the Purchase Agreement
from the Contract Purchaser to the Property Owner Subsidiary pursuant to Section
1.03.
(c)    Failure to Close Property Closing. The Members acknowledge that upon
execution of this Agreement, (i) the Property Owner Subsidiary will be required
to fund the Deposit under the Purchase Agreement, (ii) the Deposit under the
Purchase Agreement will be non-refundable subject to the express conditions to
the Property Closing set forth in the Purchase Agreement, including the failure
of the holders of the Mortgage Loan and Mezzanine Loan to approve the
Subsidiaries’ assumption of the Loan, (iii) the Members shall be obligated to
fund their respective initial capital contributions in accordance with this
Section 3.01. If a Member fails to fund the full amount of its initial capital
contribution in accordance with this Section 3.01 or otherwise refuses to allow
the Subsidiaries to close the Property Closing and assumption of the Loan under
the Purchase Agreement in violation of this Agreement or the Purchase Agreement
and such failure to fund or close results in or would result in a default under
the Purchase Agreement, then in additional to any other remedy set forth in this
Agreement, the non-defaulting Member shall have the unilateral authority and
without the consent of the defaulting Member to cause the Subsidiaries to close
the Property Closing and assumption of the Loan pursuant to the Purchase
Agreement, in which event the defaulting Member shall be no longer be a Member
of the Company and shall receive no return of its capital to the extent such
defaulting Member had previously funded any part of its capital under this
Section 3.01. In the event a Member fails to fund the full amount of its initial
capital contribution in this Section 3.01 or otherwise refuses to allow the
Subsidiaries to close the Property Closing or the assumption of the Loan under
the Purchase Agreement in violation of this Agreement or the Purchase Agreement
and such failure to fund or close results in or would result in a default under
the Purchase Agreement and the non-defaulting member elects not to close the
Property Closing, the defaulting Member shall be liable for the non-defaulting
Member’s share of the Deposit that is not returned to the non-defaulting Member
and for all costs and expenses incurred by such non-defaulting Member incurred
in connection with this Agreement and the Property, including all costs to
negotiate this Agreement, to the extent such costs and expenses have not
previously been reimbursed to such non-defaulting Member (the lost Deposit and
such costs and expenses, collectively, the “Reimbursable Expenses”). The
defaulting Member shall pay to the non-defaulting Member such reimbursement
within ten (10) days of the non-defaulting Member’s written request therefor,
which request shall reasonably substantiate the Reimbursable Expenses incurred.
If the defaulting Member is (i) KBS then KBS SOR Properties, LLC (the “KBS
Credit Party”) shall guaranty the Reimbursable Expenses incurred by JV Member,
or (ii) JV Member then Savanna Real Estate Fund III, L.P. (the “Savanna Credit
Party”) shall guaranty the Reimbursable Expenses incurred by KBS. If the
Property Closing does not otherwise occur and the Deposit is returned to the
Property Owner Subsidiary, then the Company shall be dissolved pursuant to
Article VIII.
3.02    Default in Capital Commitment. If JV Member or KBS (as applicable, the
“Defaulting Member”) shall fail to contribute its share of any amounts required
to be

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contributed pursuant to Section 3.01 or any approved additional capital
contributions pursuant to Section 3.06 (the “Defaulted Amount”) and such failure
shall continue for at least five (5) business days following notice to the
Defaulting Member (provided that no notice or cure period shall apply to a
Member’s failure to fund its share of the required capital to the Company for
the Property Closing pursuant to the Purchase Agreement), KBS or JV Member, as
applicable, (the “Non-Defaulting Member(s)”) may, but shall not be obligated to,
contribute some or all of the Defaulted Amount as a capital contribution to the
Company or as a loan to the Defaulting Member (a “Default Loan”). If the
Non-Defaulting Member elects to contribute some or all of the Defaulted amount
as a capital contribution to the Company, then the Percentage Interests of KBS
and the JV Member on Exhibit A shall be adjusted as if the Non-Defaulting Member
contributed 150% of the amount of capital actually contributed by the
Non-Defaulting Member following the failure of the Defaulting Member to
contribute its share of required capital to the Company. If the Non-Defaulting
Member elects to provide the Default Loan, then it shall pay the proceeds
directly to the Company. A Default Loan shall not be considered a capital
contribution by the Non-Defaulting Member and shall not increase the Capital
Account balance or the Percentage Interest of the Non-Defaulting Member, but
instead shall be treated as a non-recourse loan by the Non-Defaulting Member to
the Defaulting Member (and a capital contribution by the Defaulting Member) and
shall bear interest at the lesser of (x) the Default Loan Rate (hereinafter
defined) or (y) the maximum amount permitted by law. To the extent not repaid
directly by the Defaulting Member, a Default Loan, together with any accrued and
unpaid interest thereon, shall be repaid out of any subsequent distributions of
Net Cash or any other payment from the Company to which the Defaulting Member
would otherwise be entitled (but such distributions actually paid to the lending
Members shall nonetheless constitute a distribution to the Defaulting Member for
purposes of this Agreement), and such payments shall be applied first to the
payment of accrued but unpaid interest on each such obligation and then to the
payment of the outstanding principal until the Default Loan is paid in full.
“Default Loan Rate” is defined as a cumulative annual rate equal to twenty
percent (20%), compounded quarterly (pro-rated for periods of less than one
year), on the daily average outstanding balance during each fiscal year of the
Member’s aggregate unreturned Default Loan.
3.03    Member Loans. In the event Managing Member determines, in its reasonable
discretion, that funds in addition to those otherwise obtained pursuant to
Section 3.01 are necessary for the Company to meet the Annual Budget, Business
Plan and Managing Member has elected not to request such additional funds in the
form of additional capital pursuant to Section 3.06, then Managing Member shall
deliver written notice of such actual or projected cash deficit to KBS and JV
Member requesting that they agree that a loan (a “Member Loan”) should be made
to the Company, which notice shall specify the term and interest rate of the
requested Member Loan. All such Member Loans shall be structured to qualify as
“real estate assets” within the meaning of Section 856(c)(5) of the Code. Within
ten (10) business days following the effective date of such notice, each such
Member shall notify Managing Member (a) whether or not such Member agrees that
Member Loan(s) to the Company should be made in the amount specified in Managing
Member’s notice, and (b) whether such Member elects, in its sole and absolute
discretion, to make such Member Loan. If KBS and JV Member (y) agree that a
Member Loan in the amount specified in Managing Member’s notice should be made,
and (z) elect to advance such funds by the Company, such funds shall be advanced
by Members in proportion to their respective percentage set forth opposite such
Member’s name under the

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column labeled “Percentage Interest” on Exhibit A attached hereto (the
“Percentage Interests”) (or as such Members otherwise agree). Any and all
advances made by any Member to the Company pursuant to this Section 3.03 shall
be treated as a Member Loan with recourse only to the assets of the Company (and
not to the assets of any Member), and shall bear annual interest as set forth in
Managing Member’s notice. If, from any circumstances whatsoever, the Members
ever receive as interest under a Member Loan in an amount which would exceed the
highest lawful rate, such amount which would be excessive interest shall be
applied to the reduction of the unpaid principal balance due under such Member
Loan and not to the payment of interest. Any and all Member Loans shall be due
and payable from the first available funds of the Company and in any event upon
the liquidation of the Company. The repayment of any Member Loan shall be made
prior to any distributions of Net Cash or other cash proceeds to the Members,
but shall be subordinate to any fees or reimbursements required to be made to
the Members and/or their Affiliates pursuant to Section 2.13 and/or the
agreements described in Section 2.11. Accordingly, notwithstanding the
provisions of Articles V and VIII, until any and all Member Loans are repaid in
full, the Members shall draw no further distributions from the Company and all
cash or property otherwise distributable with respect to the Interests of the
Members shall be paid to the Member(s) making Member Loan(s) in proportion to,
and as a reduction of, the outstanding balance(s) of such Member Loan(s), with
such funds being applied first to reduce any interest accrued thereon, and then
to reduce the principal amount thereof.
3.04    Determination of IRR Returns and Equity Multiple.
(a)    IRR Return. The IRR Return described in Section 5.01 shall be determined
based upon internal rate of return of KBS and JV Member. As used in this
Agreement, the term “IRR Return” means for each of KBS and JV Member the
effective annual discount rate that results in a net present value equal to zero
when the discount rate is applied to all capital contributions by each such
Member and all distributions made by the Company to each such Member pursuant to
this Agreement based on the actual date of capital contributions and
distributions. The IRR Return shall be calculated using the XIRR function
provided in Microsoft Office Excel to compute internal rate of return. It is
understood by the Members that the achievement of a particular IRR Return
requires both a return of all capital contributions plus a cumulative return on
such capital contributions at the applicable percentage IRR Return.
(b)    Equity Multiple. The “Equity Multiple” described in Section 5.01 shall
equal all actual distributions made by the Company to KBS pursuant to this
Agreement divided by all of KBS’s capital contributions to the Company. The
Equity Multiple shall be agreed upon by JV Member and KBS, in their reasonable
good faith judgment.
3.05    Capital Contributions in General. Except as otherwise expressly provided
in this Agreement or as otherwise agreed to by all Members in writing (i) no
Member may withdraw all or any portion of any contribution that such Member may
have made to the capital of the Company without each other Member’s consent,
(ii) no Member shall be entitled to receive interest on such Member’s
contributions to the capital of the Company, and (iii) no Member shall be
required or entitled to contribute additional capital to the Company
3.06    Additional Capital Contributions. Following the contribution of all the
amounts described in Section 3.01 Managing Member shall have the right to make a
capital call by

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delivering written notice to KBS and JV Member under this Section 3.06 if and
only to the extent consistent with the approved Annual Budget or otherwise
approved by the Members. Each Member shall contribute its share of the
additional capital contributions called for under this Section 3.06 (in
accordance with its Percentage Interest) in cash on or before the due date
specified in the written notice, which due date shall be no less than ten (10)
business days from the date of this written notice. If a Member fails to make
its share of the additional capital contributions called for on or before the
due date specified in Managing Member’s written notice, the Non-Defaulting
Member shall have the right (but not the obligation and without waiving any
remedies hereunder as a result of such failure) to make a Default Loan pursuant
to Section 3.02.
3.07    Guaranties.
(a)    Required Guaranties. If in connection with any financing of the Property,
including any mezzanine financing pertaining to the Property and the assumption
of the Loan, a lender requires a guaranty of (i) standard non-recourse carve
outs, (ii) certain environmental conditions and (iii) other funding obligations
related to certain tenant improvement or leasing costs or exculpated expense
costs (each a “Required Guaranty” and collectively, the “Required Guaranties”),
such Required Guaranties shall be from the Company and/or the JV Member
(individually and collectively, the “Guarantor”). Except as provided in Section
3.07(f), KBS and its Affiliates shall have no obligation to enter into any
Required Guaranties. The Guarantor shall not receive any fees or other
compensation for making a Required Guaranty.
(b)    Proportionate Guaranty Obligations of the Members. Except to the extent
Section 3.07(c) provides otherwise, if a Guarantor shall deliver a Required
Guaranty and if such Guarantor shall make any payment under any such Required
Guaranty, each Member hereby covenants and agrees to satisfy, or cause to be
satisfied, its Proportionate Guaranty Obligation (as defined below) with respect
to any and all of the Required Guaranties (whether or not such Member actually
guaranteed the subject loan and regardless of the amount of the subject loan
guaranteed by such Member) and each Member’s payment or its Proportionate
Guaranty Obligation shall be treated as an additional capital contribution to
the Company by each Member for all purposes of this Agreement. If and to the
extent a Member (or its Affiliate) has failed to fully satisfy its Proportionate
Guaranty Obligation within thirty (30) Business Days following the date such
Member is notified that such Guarantor has made such payment under the
applicable Required Guaranty, the other Member may exercise its rights under
Section 3.07(d) below. “Proportionate Guaranty Obligation” means with respect to
any Required Guaranty which any Guarantor shall provide to a lender, the
obligation of each Member pursuant to this Section 3.07(b) to make payments (to
a third party lender, the Company, to any other Member or the Guarantor) in an
amount equal to the product of (x) the aggregate amount paid and/or due and
payable under any and all such Required Guaranties multiplied by (y) the
Percentage Interest of such Member.
(c)    Exceptions to Proportionate Guaranty Obligations. Notwithstanding
anything to the contrary in Section 3.07(b):
(i)    Conduct By KBS. Any and all amounts paid by the Guarantor with respect to
any of the foregoing Required Guaranties as a result of any conduct or

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action that the Co-Managing Member (or its Affiliates) shall have taken in
violation of this Agreement or which is a result of any gross negligence, fraud
or intentional misconduct of the Co-Managing Member (and/or its Affiliates)
shall be funded solely by the Co-Managing Member (subject to the rights of
indemnification set forth in Section 3.07(e)), JV Member (or its Affiliate)
shall have no Proportionate Guaranty Obligation with respect to such payments,
such amounts funded by the Co-Managing Member (or its Affiliates) shall not be
considered a capital contribution by the Co-Managing Member, and the Co-Managing
Member (or its Affiliate) shall reimburse the Guarantor for such amount within
thirty (30) Business Days of written demand. If the Co-Managing Member (or its
Affiliate) fails to make such payment, JV Member shall, as its sole remedy, be
entitled to exercise its rights set forth in Section 3.07(d) hereof; and
(ii)    Conduct by JV Member. Any and all amounts paid by the Guarantor with
respect to any of the foregoing Required Guaranties as a result of any conduct
or action that the JV Member (or its Affiliates) shall have taken in violation
of this Agreement or which is a result of any gross negligence, fraud or
intentional misconduct of JV Member (or its Affiliates) shall be funded solely
by the JV Member (subject to the rights of indemnification set forth in Section
3.07(e)), KBS (or its Affiliate) shall have no Proportionate Guaranty Obligation
with respect to such payments, such amounts funded by the JV Member (or its
Affiliates) shall not be considered a capital contribution by the JV Member, the
JV Member (or its Affiliate) shall reimburse the Guarantor for such amount
within thirty (30) Business Days of written demand. If the JV Member (or its
Affiliate) fails to make such payment, KBS shall, as its sole remedy, be
entitled to exercise its rights set forth in Section 3.07(d) hereof.
(d)    Failure to Pay Portion of Guaranty Payment by a Member. If any Member
fails to pay its Proportionate Guaranty Obligation in accordance with Section
3.07(b) or the amounts such Member is required to pay under Section 3.07(c), the
other Member may elect to fund all or any portion of the defaulting Member’s
payment as a in which case such payment shall be treated as a Default Loan made
by the defaulting Member. If KBS is the defaulting Member under Section 3.07(b)
or (c), then the KBS Credit Party shall guaranty KBS’s payment obligation under
said sections. If the JV Member is the defaulting Member under Section 3.07(b)
or (c), then the Savanna Credit Party shall guaranty JV Member’s payment
obligation under said sections.
(e)    Indemnification. The Company shall indemnify, defend and hold harmless
each Guarantor for any and all losses suffered under any Required Guaranty,
provided that no such indemnification shall be made (and a Guarantor shall
reimburse any funds advanced to them in connection with a defense of a claim and
indemnify the Company and the other Member) to the extent a court of competent
jurisdiction determines that the Member affiliated with such Guarantor is solely
liable for the losses suffered under any Required Guaranty pursuant to Section
3.07(c). The KBS Credit Party shall guaranty KBS’s indemnification obligations
under this Section 3.07(e). The Savanna Credit Party shall guaranty JV Member’s
indemnification obligations under this Section 3.07(e).
(f)    Effect of Removal of JV Member as Managing Member. If JV Member is
removed as Managing Member in accordance with Section 2.06(b), (i) Co-Managing
Member

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shall use commercially reasonable efforts to have any Guarantor that is an
Affiliate of JV Member replaced as a guarantor(s) under any Required Guaranties
for liabilities arising from conduct, actions, inactions or events first
occurring or arising after the date upon which a successor Managing Member
replaces JV Member as Managing Member (but such Guarantor(s) shall not be
replaced with respect to conduct, actions, inactions, or events first occurring
or arising on or before the date of such replacement) and (ii) to the extent
that the Guarantor any Guarantor that is an Affiliate of JV Member is not
replaced as a guarantor under the Required Guaranties as provided in clause (i),
Co-Managing Member shall indemnify, defend and hold harmless such Guarantor(c)
for any liabilities arising from conduct, actions, inactions or events first
occurring or arising after the date upon which successor Managing Member
replaces JV Member as Managing Member, except for any liabilities arising from
the conduct, actions or inactions of JV Member, its Affiliates, or the Guarantor
whether or not first arising after the date upon which successor Managing Member
replaces JV Member as Managing Member. The KBS Credit Party shall guaranty KBS’s
indemnification obligations under this Section 3.07(f).
ARTICLE IV
ALLOCATION OF PROFITS AND LOSSES
4.01    In General.
(a)    Net Profits and Net Losses shall be allocated among the Members in such a
manner so as, to the maximum extent possible, to make each Member’s Capital
Account as of the close of each year (increased by the Member’s share of
“partnership minimum gain” as defined in Treasury Regulation Section
1.704-2(b)(2) and “partner nonrecourse debt minimum gain” as defined in Treasury
Regulation Section 1.704-2(i)(5)) equal the amount that the Member would receive
if, as of the close of such year, all the assets of the Company were sold for
their Book Values (as determined immediately before such deemed sale), the
proceeds were applied to pay all Company liabilities and the remaining net
proceeds were distributed to the Members in accordance with Sections 5.01, as
then applicable at the time of such allocations. As used in this Agreement, the
term “Interest” means in respect to any Member, all of such Member’s right,
title and interest in and to the Net Profits, Net Losses, Net Cash, and capital
of the Company, and any and all other interests therein in accordance with the
provisions of this Agreement and the Act. As used in this Agreement, the terms
“Net Profits” and “Net Losses” mean, for each fiscal year or other period, an
amount equal to the Company’s taxable income or loss, as the case may be, for
such year or period, determined in accordance with Code Section 703(a) (for this
purpose, all items of income, gain, loss and deduction required to be stated
separately pursuant to Code Section 703(a)(1) shall be included in taxable
income or loss) with the following adjustments:; (a) any income of the Company
that is exempt from federal income tax and not otherwise taken into account in
computing Net Profits or Net Losses shall be added to such taxable income or
loss; (b) any expenditures of the Company described in Section 705(a)(2)(B) of
the Code or treated as 705(a)(2)(B) expenditures pursuant to Regulation Section
1.704-1(b)(2)(iv)(i), and not otherwise taken into account in computing Net
Profits or Net Losses shall be subtracted from such taxable income or loss; (c)
in the event the Book Value of any Company asset is adjusted in accordance with
clauses (b) or (d) of the definition of “Book Value”, the amount of such
adjustment shall be taken into account as gain or loss from the disposition of
such asset for purposes of computing Net Profits or Net Losses; (d) gain or loss
resulting from any disposition of Company property with respect to which gain or
loss is recognized for federal income tax

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purposes shall be computed by reference to the Book Value of the property
disposed of notwithstanding that the adjusted tax basis of such property differs
from its book value; (e) in lieu of the depreciation, amortization, and other
cost recovery deductions taken into account in computing such taxable income or
loss, whenever the Book Value of an asset differs from its adjusted basis for
federal income tax purposes at the beginning of a Fiscal Year, depreciation,
amortization or other cost recovery deductions allowable with respect to an
asset shall be an amount which bears the same ratio to such beginning Book Value
as the federal income tax depreciation, amortization or other cost recovery
deduction for such year bears to such beginning adjusted tax basis; provided,
however, that if the adjusted basis for federal income taxes of an asset at the
beginning of a year is zero, depreciation, amortization or other cost recovery
deductions shall be determined by reference to the beginning Book Value of such
asset using any reasonable method selected by the Members; and (f) any items
which are specially allocated pursuant to Section 4.02 shall not be taken into
account in computing Net Profits or Net Losses.
(b)    As used in this Agreement, the term “Book Value” means , with respect to
any asset, the adjusted basis of that asset for federal income tax purposes,
except as follows: (a) the initial Book Value of any asset contributed by a
Member to the Company will be the fair market value of the asset on the date of
the contribution, as reasonably determined by the Members; (b) the Book Values
of all assets will be adjusted to equal the respective fair market values of the
assets, as reasonably determined by the Members, as of (1) the acquisition of an
additional interest in the Company by any new or existing Member in exchange for
more than a de minimis capital contribution, (2) the distribution by the Company
to a Member of more than a de minimis amount of Company property as
consideration for an interest in the Company if an adjustment is necessary or
appropriate to reflect the relative economic interests of the Members in the
Company, (3) the liquidation of the Company within the meaning of Treasury
Regulations Section 1.704-1(b)(2)(ii)(g), (4) the grant of an interest in the
Company (other than a de minimis interest) as consideration for the provision of
services to or for the benefit of the Company, and (5) the issuance by the
Company of a non-compensatory option to acquire an interest in the Company; (c)
the Book Value of any asset distributed to any Member will be the gross fair
market value of the asset on the date of distribution as reasonably determined
by the Members; (d) the Book Values of assets will be increased or decreased to
reflect any adjustment to the adjusted basis of the assets under Code Section
734(b) or 743(b), but only to the extent that the adjustment is taken into
account in determining Capital Accounts under Treasury Regulations Section
1.704-1(b)(2)(iv)(m), provided that Book Values will not be adjusted under this
clause (d) to the extent that the Members determine that an adjustment under
clause (b) above is necessary or appropriate in connection with a transaction
that would otherwise result in an adjustment under this clause (d); and (e)
after the Book Value of any asset has been determined or adjusted under clauses
(a), (b) or (d) above, Book Value will be adjusted by the depreciation,
amortization or other cost recovery deductions taken into account with respect
to the asset for purposes of computing Net Profits or Net Losses.
(c)    The Company shall maintain “Capital Accounts” for each Member in
accordance with Treasury Regulation Section 1.704-1(b)(2)(iv). The Company shall
make all adjustments required under Treasury Regulation Section
1.704-1(b)(2)(iv), including the adjustments contained in Section
1.704-1(b)(2)(iv)(g), relating to Section 704(c) property as set forth in
Section 4.03.

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4.02    Special Allocations.
(a)    Minimum Gain Chargeback. Notwithstanding any other provision of this
Agreement, if there is a net decrease in partnership minimum gain (as defined in
Treasury Regulation Section 1.704-2(b)(2)) for a Company taxable year, each
Member shall be allocated, before any other allocation of Company items for the
taxable year, items of gross income and gain for the year (and, if necessary,
for subsequent years) in proportion to, and to the extent of, the amount of the
Member’s share of the net decrease in minimum gain during the year. The income
allocated under this Section 4.02(a) in any taxable year shall consist first of
gains recognized from the disposition of property subject to one or more
nonrecourse liabilities of the Company, and any remainder shall consist of a pro
rata portion of other items of income or gain of the Company. The allocation
otherwise required by this Section 4.02(a) shall not apply to a Member to the
extent not required, as provided in Treasury Regulation Section 1.704-2(f)(2)
through (5).
(b)    Qualified Income Offset. Notwithstanding any other provision of this
Agreement, if a Member unexpectedly receives an adjustment, allocation or
distribution described in Treasury Regulation Sections 1.704-1(b)(2)(ii)(d)(4),
(5) or (6) that causes or increases an Adjusted Capital Account Deficit with
respect to the Member, items of Company gross income and gain shall be specially
allocated to the Member in an amount and manner sufficient to eliminate such
Adjusted Capital Account Deficit as quickly as possible.
(c)    Gross Income Allocation. If at the end of any Company taxable year, a
Member has an Adjusted Capital Account Deficit, the Member shall be specially
allocated items of Company income or gain in an amount and manner sufficient to
eliminate the Adjusted Capital Account Deficit as quickly as possible.
(d)    Nonrecourse Deductions. Any “nonrecourse deductions” (as defined in
Treasury Regulation Section 1.704-2(b)(1)) shall be allocated among the Members
in accordance with their Percentage Interests.
(e)    Partner Nonrecourse Debt. Notwithstanding any other provision of this
Agreement, any “partner nonrecourse deductions” (as defined in Treasury
Regulation Section 1.704-2(i)(2)) shall be allocated to those Members that bear
the economic risk of loss for the applicable partner nonrecourse debt, and among
those Members in accordance with the ratios in which they share the economic
risk, determined in accordance with Treasury Regulation Section 1.704-2(i). If
there is a net decrease for a Company taxable year in any partner nonrecourse
debt minimum gain (as defined in Treasury Regulation Section 1.704-2(i)(5)),
each Member with a share of such partner nonrecourse debt minimum gain as of the
beginning of such year shall be allocated items of gross income and gain in the
manner and to the extent provided in Treasury Regulation Section 1.704-2(i)(4).
(f)    Adjusted Capital Account Deficit. As used in this Agreement, “Adjusted
Capital Account Deficit” means, with respect to any Member, the deficit balance,
if any, in the Member’s Capital Account as of the end of the relevant taxable
year, after giving effect to the following adjustments: (i) crediting thereto
(A) the amount of the Member’s shares of partnership minimum gain and partner
nonrecourse debt minimum gain, and (B) the amount of

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Company liabilities allocated to the Member under Section 752 of the Code with
respect to which the Member bears the economic risk of loss (as defined in
Treasury Regulation Section 1.752-2(a)), to the extent such liabilities do not
constitute partner nonrecourse debt under Treasury Regulation Section 1.752-2
and (ii) reduced by all reasonably expected adjustments, allocations and
distributions described in Treasury Regulation Sections 1.704-1(b)(2)(ii)(d)(4),
(5) and (6).
(g)    Interpretation. The foregoing provisions of this Section 4.02 are
intended to comply with Treasury Regulation Sections 1.704-1(b) and 1.704-2 and
shall be interpreted consistently with this intention. Any terms used in such
provisions that are not specifically defined in this Agreement shall have the
meaning, if any, given such terms in the Treasury Regulations cited above.
4.03    Differing Tax Basis; Tax Allocation.
(g)    Except as otherwise provided in this Section 4.03, items of income, gain,
loss and deduction of the Company to be allocated for income tax purposes shall
be allocated among the Members on the same basis as the corresponding book items
are allocated under Sections 4.01 and 4.02.
(h)    Depreciation and/or cost recovery deductions and gain or loss with
respect to each item of property treated as contributed to the capital of the
Company or revalued under Treasury Regulation Section 1.704-1(b)(2)(iv)(f) shall
be allocated among the Members for federal income tax purposes in accordance
with the principles of Section 704(c) of the Code and the Treasury Regulations
promulgated thereunder so as to take into account the variation, if any, between
the adjusted tax basis of such property and its book value (as determined for
purposes of the maintenance of Capital Accounts in accordance with this
Agreement and Treasury Regulation Section 1.704-1(b)(2)(iv)(g)). For purposes of
this Agreement, the term “Code” means the Internal Revenue Code of 1986, as
heretofore and hereafter amended form time to time (and/or any corresponding
provision of any superseding revenue laws).
ARTICLE V
DISTRIBUTION OF CASH FLOW
5.01    Distribution of Net Cash. Net Cash shall be distributed at such times as
are reasonably determined by Managing Member in the following order of priority:
(a)    First, 100% to KBS and JV Member, pari passu in proportion to their
Percentage Interests (“Pari Passu”), until KBS has received an IRR Return of
fourteen percent (14%) and KBS has received an Equity Multiple of 1.3;
(b)    Second, (i) eighty-five percent (85%) to each of KBS and JV Member Pari
Passu, and (ii) fifteen percent (15%) to JV Member until KBS has received an IRR
Return of sixteen percent (16%); provided that Net Cash that would otherwise be
distributed to KBS pursuant to clause (i) of this Section 5.01(b) shall be
distributed instead to JV Member until JV Member has received an amount of such
Net Cash, as reasonably determined by the Members, equal to the Net Cash that JV
Member would have received pursuant to clause (ii) of this Section

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5.01(b) had JV Member’s fifteen percent (15%) promote described in clause (ii)
of this Section 5.01(b) commenced after KBS’s receipt of an IRR Return of twelve
percent (12%) and an Equity Multiple of 1.3 instead of commencing after KBS’s
receipt of an IRR Return of fourteen percent (14%) and an Equity Multiple of
1.3; and
(c)    Third, (i) seventy-five percent (75%) to each of KBS and JV Member Pari
Passu, and (ii) twenty-five percent (25%) to JV Member.
5.02    Limitation on Distributions. Notwithstanding any other provision
contained in this Agreement, the Company shall not make any distributions of Net
Cash (or other proceeds) to any Member if such distribution would violate the
Act or other applicable law.
5.03    In-Kind Distribution. Assets of the Company (other than cash) shall not
be distributed in kind to the Members without the prior approval of the Members.
In the event of any distribution of real property in kind, each Member hereby
waives any right of partition in respect thereof.
ARTICLE VI
RESTRICTIONS ON TRANSFERS OF COMPANY INTERESTS
6.01    Limitations on Transfer. Except as set forth in Section 6.02, no Member
shall be entitled to sell, exchange, assign, transfer or otherwise dispose of,
pledge, hypothecate, encumber or otherwise grant a security interest in,
directly or indirectly (collectively, a “Transfer”), all or any part of such
Member’s Interest, without the prior written consent of the non-transferring
Members (which consent may be withheld in such Member’s sole and absolute
discretion). Any attempted Transfer in violation of the restrictions set forth
in this Article VI shall be null and void ab initio and of no force or effect.
Each Member shall indemnify, defend and hold the other Members and the Company
harmless from and against any and all costs, expenses and losses associated with
any Transfer in violation of the restrictions set forth in this Article VI,
including without limitation any transfer taxes and any increase in real estate
or other taxes incurred as a result of such transfer.
6.02    Permitted Transfers. Any Member and/or any direct or indirect
constituent owner of any Member may transfer all or any portion of such Member’s
Interest and/or such constituent owner’s direct or indirect ownership interest
in such Member as follows (each a “Permitted Transfer”) to a person or entity
described below (a “Permitted Transferee”) without complying with the provisions
of Section 6.01:
(a)    Transfer Between Members. Notwithstanding anything stated to the contrary
in this Agreement, any Member may sell, assign or otherwise transfer all or any
part of its Interest to any other Member on such terms as are agreed to by both
Members.
(b)    KBS Indirect Transfers. Notwithstanding anything stated to the contrary
in this Article VI or elsewhere in the Agreement, any Transfer of equity
interests or other interests in KBS, or in any of the direct or indirect owners
of KBS (including, without limitation, KBS SOR Acquisition XXV, LLC, KBS SOR
Properties, LLC, KBS Strategic Opportunity Limited Partnership or KBS Strategic
Opportunity REIT, Inc.) shall not be

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prohibited (and shall be expressly permitted) provided that KBS Strategic
Opportunity REIT, Inc. continues to own, either directly or indirectly, at least
fifty-one percent (51%) of the ownership interests in KBS.
(c)    KBS Direct Transfers. KBS shall have the right to Transfer all or any
portion of its Interest to (a) a KBS Affiliate (defined below) without Managing
Member’s approval and (b) another entity that is not a KBS Affiliate with
Managing Member’s approval, which approval may be withheld in Managing Member’s
reasonable discretion. A “KBS Affiliate” is any entity in which at least
fifty-one percent (51%) of the ownership interests is owned, directly or
indirectly, through one or more intermediaries, by KBS Strategic Opportunity
REIT, Inc.
(d)    JV Member Indirect Transfers. Notwithstanding anything stated to the
contrary in this Article VI or elsewhere in the Agreement, any Transfer of
equity interests or other interests in JV Member, or in any of the direct or
indirect owners of JV Member (including, without limitation, Savanna Real Estate
Fund III, L.P.) shall not be prohibited (and shall be expressly permitted)
provided that Savanna Real Estate Fund III, L.P. continues to own, either
directly or indirectly, at least fifty-one percent (51%) of the ownership
interests in JV Member.
(e)    JV Member Direct Transfers. JV Member shall have the right to Transfer
all or any portion its Interest to (a) a JV Member Affiliate (defined below)
without Co-Managing Member’s approval and (b) another entity that is not a JV
Member Affiliate with Co-Managing Member’s approval, which approval may be
withheld in Co-Managing Member’s reasonable discretion. A “JV Member Affiliate”
is any entity in which at least fifty-one percent (51%) of the ownership
interests is owned, directly or indirectly, through one or more intermediaries,
by Savanna Real Estate Fund III, L.P.
In the event of any Permitted Transfer, any such Permitted Transferee shall
receive and hold such Interest, such ownership interest or portion thereof
subject to the terms of this Agreement and to the obligations hereunder of the
transferor and there shall be no further transfer of such Interest, such
ownership interest or portion thereof except to a person or entity to whom such
Permitted Transferee could have transferred such Interest, such ownership
interest or portion thereof in accordance with this Section 6.02 had such
Permitted Transferee originally been a Member or a constituent owner of a Member
as of the date hereof or otherwise in accordance with the terms of this
Agreement. Notwithstanding any provision of this Agreement to the contrary, no
Member and/or any direct or indirect constituent owner of any Member shall
transfer all or any portion of such Member’s Interest or permit the transfer of
any direct or indirect ownership interest in such Member if such transfer would
(i) be a default under the Loan or any Refinance, (ii) cause a tax termination
of the Company under Section 708 of the Code that has any adverse effect on any
Member or (iii) adversely affect the Company’s status as a partnership for
income tax purposes. Any real property transfer tax associated with the Project
that is incurred as a result of one or more Transfers by a Member shall be borne
by KBS, on the one hand, and JV Member, on the other hand, in proportion to the
relative amounts, if any, by which aggregate Transfers by each of KBS and JV
Member between the date hereof and the date on which the real property transfer
tax is incurred exceed 49% of the Interests held by each of KBS and JV Member,
respectively, as of the date hereof. For example, if, at the time a real

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property transfer tax is incurred: (A) KBS has Transferred 54% of its Interests
and JV Member has Transferred 59% of its Interests, then the real property
transfer tax would be borne one-third by KBS and two-thirds by JV Member; (B)
KBS has Transferred 49% or fewer of its Interests and JV Member has Transferred
more than 49% of its Interests, then the real property transfer tax would be
borne solely by JV Member; and (C) KBS has Transferred more than 49% of its
Interests and JV Member has Transferred 49% or fewer of its Interests, then the
real property transfer tax would be borne solely by KBS.
6.03    Admission of Substituted Members. If any Member transfers such Member’s
Interest to a transferee in accordance with Sections 6.01 or 6.02, then such
transferee shall only be entitled to be admitted into the Company as a
substituted Member if (i) the Members approve such admission in writing and this
Agreement is amended to reflect such admission; (ii) the non-transferring Member
approves the form and content of the instrument of transfer; (iii) the
transferor and transferee named therein execute and acknowledge such other
instruments as the non-transferring Member may deem reasonably necessary to
effectuate such admission; (iv) the transferee in writing accepts and adopts all
of the terms and conditions of this Agreement, as the same may have been
amended; (v) the transferor pays, as the non-transferring Member may reasonably
determine, all reasonable expenses incurred in connection with such admission,
including, without limitation, legal fees and costs; and (vi) to the extent
required the lender under the Loan or any Refinance has consented to such
transfer. To the maximum extent permitted by applicable law, any transferee of
an Interest who does not become a substituted Member shall have no right to
require any information or account of the Company’s transactions, to inspect the
Company books, or to vote on any of the matters as to which a Member would be
entitled to vote under this Agreement. Any such transferee shall only be
entitled to share in such Net Profits and Net Losses, to receive such
distributions, and to receive such allocations of income, gain, loss, deduction
or credit or similar items to which the transferor was entitled, to the extent
transferred. A Member that transfers such Member’s Interest pursuant to Section
6.02 shall not cease to be a Member of the Company until the admission of the
transferee as a substituted Member in accordance with this Agreement and, except
as provided in the preceding sentence, shall continue to be entitled to
exercise, and shall continue to be subject to, all of the other rights, duties
and obligations of such Member under this Agreement.
6.04    Election; Allocations Between Transferor and Transferee. Upon the
transfer of the Interest of any Member or the distribution of any property of
the Company to a Member, the Company shall file, in the reasonable discretion of
the Members, an election in accordance with applicable Treasury Regulations, to
cause the basis of the Company property to be adjusted for federal income tax
purposes as provided by Sections 734 and 743 of the Code. Upon the transfer of
all or any part of the Interest of a Member as hereinabove provided, Net Profits
and Net Losses shall be allocated between the transferor and transferee on the
basis of a computation method that is in conformity with the methods prescribed
by Section 706 of the Code and Treasury Regulation Section 1.706-1(c)(2) and
approved by the Members affected by the method.
6.05    Waiver of Withdrawal and Purchase Rights. In accordance with the Act,
each Member acknowledges and agrees that such Member may not voluntarily
withdraw, resign or retire from the Company without the prior written consent of
each other Member, which consent may be withheld in each such other Member’s
sole and absolute discretion. Each Member

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further acknowledges and agrees that such Member shall not be entitled to
receive the fair market value of such Member’s Interest in the Company pursuant
to the Act.
ARTICLE VII
ELECTIVE SALE
7.01    Elective Sale of the Project.
(a)    Except as set forth in Section 7.01(d), at any time after the second
(2nd) anniversary of the date of this Agreement, either Member (the “Electing
Sale Member”) shall have the continuing right upon notice to the other Member
(the “Non-Electing Sale Member”) to solicit offers from third parties to sell
the Project; provided that, except as set forth in Section 7.01(d), prior to
soliciting any such offers or upon receipt of an unsolicited offer that the
Electing Sale Member desires the Company accept, the Electing Sale Member shall
provide written notice to the Non-Electing Sale Member (a “Sale Notice”) of its
intent to solicit offers for the Project. The Sale Notice shall set forth the
proposed sales price of the Project (the “Proposed Project Value”). For twenty
(20) days following receipt of a Sale Notice, the Non-Electing Member may elect
to buy the Electing Sale Member’s Interest in the Company (a “Purchase
Election”) in lieu of selling the Project by delivery of written notice thereof
to Electing Sale Member (the “Purchase Election Notice”). If a Purchase Election
is made the purchase price (the “Purchase Price”) for the Electing Sale Member’s
Interest shall be the amount the Electing Sale Member would receive (net of
reasonable and customary closing costs) if the Project were to be sold for the
Proposed Project Value and the proceeds of such deemed sale were distributed
upon a liquidation of the Company pursuant to Section 8.02. The closing of the
purchase and sale of the Electing Sale Member’s Interest in the Company shall
take place on a date agreed upon by the Electing Sale Member and the purchaser
of such interest, which date may not be later than ninety (90) days following
the date of the Purchase Election (the “Purchase Closing Date”). To be
effective, the Purchase Election Notice must be accompanied by the deposit, in
escrow with Commonwealth Land Title Insurance Company or Chicago Title Insurance
Company (“Escrow Agent”), of a non-refundable (but applicable to
the purchase price) cash deposit (the “Member Deposit”) equal to five percent
(5%) of the Proposed Project Value. The closing of the purchase and sale of the
Electing Sale Member’s Interest pursuant to the terms of this Section 7.01(a)
shall be held on the Purchase Closing Date, at the office of the Company, or at
such other location as the parties shall find mutually agreeable. At the
closing: (A) the Electing Sale Member shall receive, by wire transfer of
immediately available federal funds to an account designated by the Electing
Sale Member, an amount equal to the Purchase Price; (B) the Electing Sale Member
shall deliver to the Non-Electing Sale Member a duly executed and acknowledged
instrument assigning to the Non-Electing Sale Member the Electing Sale Member’s
Interest, which assignment shall be accompanied by such other documents and
instruments, including, without limitation, corporate resolutions, as may be
reasonably requested by the Non-Electing Sale Member or the Company in the
exercise of their reasonable judgment or other documents requested by any title
company; (C) the Non-Electing Sale Member shall deliver to the Electing Sale
Member a duly executed and acknowledged instrument assuming the Electing Sale
Member’s Interest in the Company and releasing Electing Sale Member from all
claims pertaining to the Interests or the Company other than claims for breach
of the representations and warranties of the Electing Sale Member described in
the following sentence or a breach of any of the assignment documents executed
by

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the Electing Sale Member and delivered to the Non-Electing Sale Member in
connection with the transfer contemplated in this Section; (D) on the effective
date of such assignment, the Company shall deliver a release to the Electing
Sale Member releasing the Electing Sale Member from all liabilities and
obligations of the Company arising from and after the date of such assignment;
and (E) the Company shall use good faith commercially reasonable efforts to
cause the Electing Sale Member or its Affiliates to be released from any
liabilities under any guaranties for the benefit of the Company executed by the
Electing Sale Member or its Affiliates, and if the beneficiaries of any such
guaranty will not agree to such a release, the Non-Electing Sale Member shall
indemnify and hold harmless the Electing Sale Member or its Affiliates who are
guarantors of such liabilities in a form reasonably acceptable to Electing Sale
Member. If the Non-Electing Sale Party is (i) KBS then the KBS Credit Party
shall guaranty the indemnification obligation in the prior sentence or (ii) JV
Member then the Savanna Credit Party shall guaranty the indemnification
obligation in the prior sentence. Such assignment shall be free and clear of all
liens and encumbrances, and the Electing Sale Member shall deliver a written
representation and warranty to such effect at the closing, which representation
and warranty shall survive for a period of six (6) months following the closing.
Each Member shall pay its legal fees in connection with the conveyance of the
Interest pursuant to this Section, and all other costs and expenses (including,
without limitation, transfer taxes) shall be shared by the Members in accordance
with their Interests. In the event that the Non-Electing Sale Member defaults in
its obligation to purchase the Electing Sale Member’s Interests pursuant to this
Section 7.01 (a “Purchase Default Event”), the Deposit shall be forfeited by the
Non-Electing Sale Member, and the Electing Sale Member shall be thereafter be
entitled to sell the Project without further restriction.
(b)    If a Purchase Election is not timely made or a Purchase Default Event has
occurred, the Electing Sale Member shall have the right to retain brokers on
behalf of the Company and to advertise the Project for sale and to cause the
Company to sell the Project so long as such sale is consummated within twelve
(12) months of the end of the twenty (20) day period for the Purchase Election.
Electing Sale Member shall keep the Non-Electing Sale Member informed of the
progress of the sale of the Project. The Non-Electing Sale Member shall
cooperate with the Electing Sale Member in connection with the sale of the
Project and shall execute such documents (in its capacity as a Member in the
Company, and/or as the Managing Member or Co-Managing Member, as applicable) as
may be reasonably required to effectuate the sale of the Project; provided that
the Non-Electing Sale Member shall not be exposed to any personal liability.
Managing Member hereby irrevocably constitutes and appoints the Electing Sale
Member (if the Electing Sale Member is not the Managing Member) as its agent and
attorney-in-fact, coupled with an interest, for the purpose of executing and
delivering any documents required to be executed and delivered by the Electing
Sale Member pursuant to this Section 7.01 in the event Managing Member fails or
refuses to execute the same upon the request of Electing Sale Member.
(c)    Notwithstanding the foregoing and provided that a Purchase Default Event
has not occurred, if as a result of the Electing Sale Member’s marketing
efforts, the Electing Sale Member receives a bona fide offer from a third party
purchaser and desires to sell the Project in a sale that will result in (i) a
purchase price that is less than ninety percent (98%) of the Proposed Project
Value, or (ii) the Non-Electing Sale Member receiving less than it would have
received

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(net of reasonable and customary closing costs) under this Agreement upon a
liquidation of the Company pursuant to Section 8.02 had the Project been sold
for ninety percent (98%) of the Proposed Project Value, the Electing Sale Member
shall deliver a revised Sale Notice to the Non-Electing Sale Member, which shall
set forth the new proposed sales price for the Project, and the Non-Electing
Sale Member shall have ten (10) days following receipt of the revised Sale
Notice to make a Purchase Election in the manner described in Section 7.01(a)
above in lieu of having the Project sold. If a Purchase Election with respect to
the revised Sale Notice is not timely made, the Electing Sale Member shall have
the right to cause the Company to sell the Project pursuant to Section 7.01(b).
If a Purchase Election is timely made with respect to the revised Sale Notice,
the Members shall follow the procedures set forth in Section 7.01(a) above;
provided, however, that references to Proposed Project Value shall instead refer
to the Proposed Project Value set forth in the revised Sale Notice. If a
Purchase Election is timely made and a Purchase Default Event occurs, the
Electing Sale Member shall be entitled to retain the Member Deposit, and
Electing Sale Member shall be thereafter be entitled to sell the Project without
further restriction.
(d)    Notwithstanding anything to the contrary in this Section 7.01, if the JV
Member has been removed as the Managing Member as a result of a Just Cause
Event, JV Member shall have the right to be an Electing Sale Member at any time
after the third (3rd) anniversary of the date of this Agreement (but not
before), but JV Member shall no longer have the right to receive a Sale Notice
(and no Sale Notice need be delivered to JV Member) and JV Member shall no
longer have a Purchase Election under this Section 7.01.
ARTICLE VIII
DISSOLUTION AND WINDING UP OF THE COMPANY
8.01    Events Causing Dissolution of the Company. Upon any Member’s bankruptcy,
retirement, resignation, expulsion or other cessation to serve or the admission
of any new member into the Company, the Company shall not dissolve, but the
business of the Company shall continue without interruption and without any
break in continuity. The Company shall be dissolved and its affairs wound up
upon the first to occur of: (i) the expiration of the term of the Company unless
such term has been extended by the Members; (ii) the sale, transfer or other
disposition by the Company of all or substantially all of its assets and the
collection by the Company of any and all Net Cash derived therefrom; (iii) the
agreement of the Members to dissolve the Company; (iv) the entry of a decree of
judicial dissolution pursuant to the Act; or (v) if the Property Closing does
not occur.
8.02    Winding Up of the Company. Upon the Liquidation of the Company caused by
other than the termination of the Company under Code Section 708(b)(1)(B) (in
which latter case the Company shall remain in existence in accordance with the
provisions of such Section of the Code), the Members shall proceed to the
winding up of the affairs of the Company. During such winding up process, the
Net Profits, Net Losses and Net Cash distributions shall continue to be shared
by the Members in accordance with this Agreement. The assets shall be liquidated
as promptly as consistent with obtaining a fair value therefor, and the proceeds
therefrom, to the extent available, shall be applied and distributed by the
Company on or before the end of the taxable year of such Liquidation or, if
later, within ninety (90) days after such Liquidation, in the following order:
(i) first, to creditors of the Company (including Members who are creditors in

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the order of priority as provided by law including, without limitation, any
Members that have made Member Loans and Default Loans); (ii) second, to the
setting up of any reserves which the Members determine, in their reasonable
discretion, are necessary for any contingent, conditional or unmatured
liabilities or obligations of the Company (which shall be distributed at such
time as is determined in the reasonable discretion of the Members); and (iii)
the balance, if any, to the Members in accordance with the distribution schedule
of Section 5.01. Such distribution shall be made by the date specified in
Treasury Regulation Section 1.704-1(b)(2)(ii)(b)(2). As used in this Agreement,
the term “Liquidation” means (i) in respect to the Company the earlier of the
date upon which the Company is terminated under Code Section 708(b)(1) or the
date upon which the Company ceases to be a going concern (even though it may
continue in existence for the purpose of winding up its affairs, paying its
debts and distributing any remaining balance to its Members), and (ii) in
respect to a Member wherein the Company is not in Liquidation, means the
liquidation of a Member’s interest in the Company under Treasury Regulation
Section 1.761-1(d).
8.03    Negative Capital Account Restoration. No Member shall have any
obligation whatsoever upon the Liquidation of such Member’s Interest, the
Liquidation of the Company or in any other event, to contribute all or any
portion of any negative balance standing in such Member’s Capital Account to the
Company, to each other Member or to any other person or entity.
ARTICLE IX
BOOKS AND RECORDS
9.01    Books of Account and Bank Accounts. The fiscal year and taxable year of
the Company shall be the year ending December 31. Managing Member shall or shall
cause the Property Manager to: (x) maintain all of the books and records of the
Company, in all material respects, in accordance with the standards of the
industry using the income tax basis, consistently applied (provided that monthly
reporting shall be on an accrual basis and balance sheets shall be on a cost
basis) and (y) provide operating reports and financial statements to each other
Member not less frequently than once each month summarizing the operating
activities of the Company during the immediately preceding calendar month, any
material deviations from the Business Plan or the Annual Budget during such
preceding calendar month, and such other information as is reasonably requested
by any Member, all within twenty (20) days after the end of such preceding
calendar month. During normal business hours at the Project or the offices of
Managing Member, on not less than three (3) business days prior notice, all of
the following shall be made available for inspection and copying by all of the
Members at their own expense for any purpose reasonably related to each such
Member’s Interest in the Company: (i) all books and records relating to the
business and financial condition of the Company, (ii) a current list of the name
and last known business, residence or mailing address of each Member, (iii) a
copy of this Agreement, the Certificate of Formation and all amendments thereto,
together with executed copies of any written powers-of-attorney pursuant to
which this Agreement, the Certificate of Formation and all amendments thereto
have been executed, (iv) the amount of cash and a description and statement of
the agreed value of any other property or services contributed by each Member to
the capital of the Company and which each Member has agreed to contribute in the
future, and (v) the date upon which each Member became a Member of the Company.
Upon not less than three (3) business days prior notice, Managing Member shall
cooperate with any

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Member that requests, at such Member’s sole cost and expense, and not more than
one (1) time in each calendar year, to conduct an independent audit of the
Company.
9.02    Tax Returns. Managing Member shall cause to be prepared and timely filed
and distributed to each Member, at the expense of the Company (and prepared by
an accounting firm approved by the Members), all required federal and state
Company tax returns, which shall be delivered to the Members by no later than
March 31 each year; provided however, in the event that it is not possible for
Managing Member to have such materials by said date using best efforts to meet
the deadline, Managing Member shall: (i) notify the other Members by March 15
that such materials will not be available, (ii) deliver estimated drafts of such
information to the other Members by March 31, and (iii) deliver all such
information to the other Members by June 30 of said year. Managing Member shall
not file any tax return on behalf of the Company without the prior written
approval of the Members; provided that if any Member shall not respond to a
written request to approve a tax return within fifteen (15) days such Member
shall be deemed to have approved such tax return. Managing Member is hereby
designated as the “tax matters partner” of the Company as determined in
accordance with the provisions of Section 6231(a)(7) of the Code and the
Treasury Regulations promulgated thereunder.
The tax matters partner shall cause each other Member to be a “notice partner”
within the meaning of Code Section 6223. The tax matters partner shall inform
each other Member of all significant matters that come to its attention in its
capacity as tax matters partner by giving notice thereof within five days after
becoming aware thereof and, within that time, shall forward to each other Member
copies of all material written communications it may receive in that capacity.
The tax matters partner shall not enter into any settlement or other agreement
with any tax authority that purports to bind any Member other than the tax
matters partner without the other Member’s prior written consent.
ARTICLE X
MISCELLANEOUS
10.01    Notices. All notices or other communications required or permitted
hereunder shall be in writing, and shall be delivered or sent, as the case may
be, by any of the following methods: (i) personal delivery, (ii) overnight
commercial carrier, (iii) certified mail, postage prepaid, return receipt
requested, or (iv) email. Any such notice or other communication shall be deemed
received and effective upon the date of acceptance or rejection of delivery. Any
notice or other communication sent by email must be confirmed within two (2)
days by letter mailed or delivered in accordance with the foregoing. Any
reference herein to the date of receipt, delivery, or giving, or effective date,
as the case may be, of any notice or communication shall refer to the date such
communication becomes effective under the terms of this Section 10.01. Any such
notice or other communication so delivered shall be addressed to the party to be
served at the address for such party set forth on Exhibit A attached hereto.
Such addresses may be changed by giving written notice to the other parties in
the manner set forth in this Section 10.01. Rejection or other refusal to accept
or the inability to deliver because of changed address of which no notice was
given shall be deemed to constitute receipt of notice or other communication
sent.
10.02    Construction of Agreement. This Agreement contains the entire
understanding between the parties hereto and supersedes any prior or
contemporaneous understanding,

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correspondence, negotiations or agreements between them respecting the within
subject matter. No alteration, modification or interpretation hereof shall be
binding unless in writing signed by all of the Members (and the Savanna Credit
Party and the KBS Credit Party if such modification would affect such credit
party’s obligations under this Agreement). The Article and Section headings of
this Agreement are used herein for reference purposes only and shall not govern,
limit, or be used in construing this Agreement or any provision hereof. Any
Exhibit attached hereto is incorporated herein by this reference and expressly
made a part of this Agreement for all purposes. Time is of the essence of this
Agreement. The provisions of this Agreement shall be construed and enforced in
accordance with the laws of the State of Delaware, and all rights, duties,
obligations and remedies shall be governed by the Act without regard to
principles of conflict of laws. If any arbitration, action or suit is brought by
any Member against any other Member that arises out of this Agreement, then the
prevailing Member in such arbitration, action or suit shall be entitled to
recover reasonable attorneys’ fees and costs from the non-prevailing Member.
Subject to the restrictions set forth in Articles VI and VII, and Section 10.04,
this Agreement shall inure to the benefit of and shall bind the parties hereto
and their respective personal representatives, successors, and assigns. Any
agreement to pay any amount and any assumption of liability herein contained,
express or implied, shall be only for the benefit of the Members and their
respective successors and assigns, and such agreements and assumptions shall not
inure to the benefit of the obligees of any indebtedness or any other party,
whomsoever, deemed to be a third-party beneficiary of this Agreement. Each of
the Exhibits attached hereto is incorporated herein by this reference and
expressly made a part of this Agreement for all purposes. References to any
Exhibit made in this Agreement shall be deemed to include this reference and
incorporation. This Agreement may be executed in multiple counterparts, each of
which shall be deemed an original Agreement, but all of which shall constitute a
single Agreement, binding on the parties hereto. Where the context so requires,
the use of the neuter gender shall include the masculine and feminine genders,
the masculine gender shall include the feminine and neuter genders, and the
singular number shall include the plural and vice versa. The signature of any
party hereto to any counterpart hereof shall be deemed a signature to, and may
be appended to, any other counterpart. Every provision of this Agreement is
intended to be severable. Each Member acknowledges that (i) each Member is of
equal bargaining strength; and (ii) each Member has actively participated in the
drafting, preparation and negotiation of this Agreement.
10.03    Partnership Intended Solely for Tax Purposes. The Members have formed
the Company as a Delaware limited liability company under the Act, and do not
intend to form a corporation or a general or limited partnership under Delaware
or any other state law. The Members do not intend to be shareholders and/or
partners to one another or to any third party. The Members intend the Company to
be classified and treated as a partnership solely for federal and state income
taxation purposes. Each Member agrees to act consistently with the foregoing
provisions of this Section 10.03 for all purposes, including, without
limitation, for purposes of reporting the transactions contemplated herein to
the Internal Revenue Service and all state and local taxing authorities.
10.04    Investment Representations. Each Member agrees as follows with respect
to investment representations:
(a)    Each Member understands:

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(i)    That the Interests in the Company evidenced by this Agreement have not
been registered under the Securities Act of 1933, 15 U.S.C. § 15b et seq., or
any state securities laws (collectively, the “Securities Acts”) because the
Company is issuing Interests in the Company in reliance upon the exemptions from
the registration requirements of the Securities Acts providing for issuance of
securities not involving a public offering;
(ii)    That the Company has relied upon the representation made by each Member
that such Member’s Interest in the Company is to be held by such Member for
investment; and
(iii)    That exemption from registration under the Securities Acts would not be
available if any Interest in the Company was acquired by a Member with a view to
distribution. Each Member agrees that the Company is under no obligation to
register the Interests in the Company or to assist the Members in complying with
any exemption from registration under the Securities Acts if the Member should
at a later date wish to dispose of such Member’s Interest in the Company.
(b)    Each Member hereby represents to the Company that such Member is
acquiring such Member’s Interest in the Company for such Member’s own account,
for investment and not with a view to the resale or distribution of such
Interest (except for any transfers made in accordance with the provisions of
Article VI).Each Member recognizes that no public market exists with respect to
the Interests and no representation has been made that such a public market will
exist at a future date.
(c)    Each Member recognizes that no public market exists with respect to the
Interests and no representation has been made that such a public market will
exist at a future date.
(d)    Each Member hereby represents that such Member has not received any
advertisement or general solicitation with respect to the sale of the Interests.
(e)    Each Member acknowledges that such Member has a preexisting personal or
business relationship with the Company or its officers or principal Interest
holders, or, by reason of such Member’s business or financial experience or the
business or financial experience of such Member’s financial advisors (who are
not affiliated with the Company), could be reasonably assumed to have the
capacity to protect such Member’s own interest in connection with the purchase
of such Member’s Interest. Each Member further acknowledges that such Member is
familiar with the financial condition and prospects of the Company’s business,
and has discussed with each other Member the current activities of the Company.
Each Member believes that the Interests are securities of the kind such Member
wishes to purchase and hold for investment, and that the nature and amount of
the Interests to be acquired by such Member is consistent with such Member’s
investment program.
(f)    Before acquiring any Interest in the Company, each Member has
investigated the Company and its business and the Company has made available to
each Member and his/her/its attorney, accountant, purchaser representative
and/or tax adviser, if any (collectively, the “Advisers”), this Agreement and
all information necessary for the Member to make an informed decision to acquire
an Interest in the Company. Each Member, together with

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its Advisers, if any, considers itself to be a person possessing experience and
sophistication as an investor adequate for the evaluation of the merits and
risks of the Member’s investment in the Company. In making an investment
decision, each Member, together with its Advisors, if any, has made an
independent evaluation of the prospective investment in the Company, is relying
on its own examination of the Company, this Agreement and the terms thereof,
including the merits and risks involved, and is not relying on any advice,
guidance or investigation by or from the Company, the Managing Member or any
Affiliate of the Company or the Managing Member.
(g)    In evaluating the suitability of an investment in the Company, each
Member has not relied upon any representation or information (oral or written)
other than as stated in this Agreement.
(h)    Each Member understands the meaning and consequences of the
representations, warranties and covenants made by such Member set forth herein
and that the Company has relied upon such representations, warranties and
covenants. Each Member hereby indemnifies, defends, protects and holds wholly
free and harmless the Company and each other Member from and against any and all
losses, damages, expenses or liabilities arising out of the breach and/or
inaccuracy of any such representation, warranty and/or covenant. All
representations, warranties and covenants contained herein and the
indemnification contained in this Section 10.04(g) shall survive the execution
of this Agreement, the formation of the Company, and the liquidation of the
Company.
10.05    Waiver of Conflict of Interest. The Company is not represented by
separate counsel; provided, however, in connection with the formation of the
Company and the drafting and negotiation of this Agreement, JV Member and the
Company (and not KBS) have been represented by Hunton & Williams LLP, 200 Park
Avenue, New York, New York 10166, Attention, Carl F. Schwartz, and KBS (and not
JV Member or the Company) has been represented by Greenberg Traurig, LLP, 1750
Tysons Boulevard, McLean, Virginia 22102, Attention, Scott Morehouse. To the
extent that the foregoing representation constitutes a conflict of interest, the
Company and each Member hereby expressly waive any such conflict of interest.
Upon creation of the Company, the Company shall only be represented by counsel
in accordance with Section 2.02(i).
10.06    Outside Activities. No Member shall not have any obligations (fiduciary
or otherwise) with respect to the Company or the other Members insofar as making
other investment opportunities available to the Company or to the other Members.
The Members may, notwithstanding the existence of this Agreement, engage in
whatever activities they may choose, whether the same are competitive with the
Company or otherwise, without having or incurring any obligation to offer any
interest in such activities to the Company or to the other Members. Neither this
Agreement nor any activities undertaken pursuant hereto shall prevent a Member
from engaging in such activities.
10.07    Confidentiality. Each Member and its Affiliates shall keep confidential
and shall not disclose, or permit the disclosure of, any information or
materials relating to the Company and its investments and activities that are
not generally known to the public or which the Members believe should remain
confidential or are required by law or agreement to remain confidential;
provided that a Member may disclose such confidential information to the extent

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(i) the disclosure of such information or materials is expressly required by
court order, law or in any litigation or arbitration proceedings; (ii) the
information or materials become publicly known other than through the actions or
inactions of such Member or its Affiliates, employees, financial sources,
representatives, agent, actual or potential permitted investors, permitted
transferees or attorneys or violations of this Agreement or any other
obligations of confidentiality of such Member; (iii) the disclosure of such
information and materials by such Member is to its Affiliates, employees,
financial sources, representatives, agents, actual or potential permitted
investors, permitted transferees, accountants, financial advisors or attorneys;
(iv) such other Member consents in writing to such disclosure; or (v) as may be
necessary for such Member to satisfy its or any Affiliate’s REIT or SEC filing,
disclosure, broker-dealer or reporting requirements. No Member shall have any
liability under this Section 10.07 by reason of any confidential information
becoming available by means beyond the reasonable control of such Member.
Notwithstanding the foregoing, this Section 10.07 shall not prohibit Managing
Member from disclosing information, in press releases or otherwise, related to
the Company and its investments and activities as is reasonably required in
connection with the performance by Managing Member of its duties (including
marketing and leasing).
10.08    Waiver of Fiduciary Duties. To the extent that any fiduciary duties
that may exist as a result of the relationship of the parties hereto (whether
arising as a result of any such party’s capacity as a Member, Managing Member or
a Tax Matters Partner) are inconsistent with, or would have the effect of
expanding or modifying any of the terms of this Agreement, (A) the express terms
of this Agreement shall control, (B) this Agreement shall be interpreted in
accordance with general principles of contract interpretation without regard to
the common law principles of agency and/or fiduciary duties, and (C) any
liability of the parties shall be based solely on principles of contract law and
the express terms of this Agreement. Each of the parties hereto further
acknowledges and agrees that for the purposes of determining the nature and
scope of the duties of a Member, Managing Member or a Tax Matters Partner under
this Agreement, the terms of this Agreement, and the duties and obligations set
forth herein, are intended to satisfy all fiduciary duties that may exist as a
result of the relationship between the parties (other than the duty of good
faith and fair dealing implied under general contract principles, independent of
the common law principles of agency and/or fiduciary duties). Accordingly, to
the fullest extent permitted under applicable law, each of the parties hereby
unconditionally and irrevocable waives and disclaims any fiduciary duties or
other similar common law rights that are not expressly identified, described and
set forth in this Agreement and thus unconditionally and irrevocable waives and
disclaims any right to recover or obtain any monetary, equitable or other relief
or remedies for any alleged breach or violation of all alleged fiduciary duties
or other similar common law rights.
ARTICLE XI
REIT PROTECTION
11.01    Certain Definitions. For the purposes of this Article XI, the following
terms shall have the following meanings:
(a)    “KBS” shall mean KBS as defined in the recitals hereto and KBS Strategic
Opportunity REIT, Inc., a Maryland corporation that has elected to be taxable
for federal income

39

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tax purposes as a real estate investment trust under the Code (herein, a
“REIT”); and/or any subsidiary or affiliate of KBS.
(b)    “REIT Prohibited Transactions” shall mean any action specified in
Section 11.02.
11.02    REIT Prohibited Transactions. Notwithstanding anything to the contrary
contained in this Agreement, during the time KBS is a Member of the Company,
neither the Company nor Managing Member nor any other Member of the Company,
shall take any of the following actions without the prior written consent of
KBS:
(a)    Entering into any lease or permitting any sublease that provides for rent
based in whole or in part on the income or profits of any person, excluding for
this purpose a lease that provides for rent based in whole or in part on a fixed
percentage or percentages of gross receipts or gross sales of any person without
reduction for any sublessor costs;
(b)    Leasing personal property, excluding for this purpose a lease of personal
property that is entered into in connection with a lease of real property where
the rent attributable to the personal property is less than fifteen percent
(15%) of the total rent provided for under the lease, determined as set forth in
Section 856(d)(1) of the Code;
(c)    Acquiring or holding debt (other than Member Loans and Default Loans)
unless (a) the amount of interest income received or accrued by the Company
under such loan does not, directly or indirectly, depend in whole or in part on
the income or profits of any person, and (b) the debt is fully secured by
mortgages on real property or on interests in real property;
(d)    Acquiring or holding more than ten percent (10%) of the outstanding
voting securities of any one issuer other than a corporation that has properly
elected to be a “taxable REIT subsidiary” of KBS;
(e)    Acquiring or holding more than ten percent (10%) of the total value of
the outstanding securities (debt or equity) of any one issuer;
(f)    Making an election or taking any action that would cause the Company to
be treated as (i) an entity that is not classified as a partnership for federal
income tax purposes or (ii) a publicly traded partnership as defined in Section
7704 of the Code;
(g)    Entering into any agreement where the Company receives amounts, directly
or indirectly, for rendering services to the tenants of the properties that are
owned, directly or indirectly, by the Company other than (i) amounts received
for services that are customarily furnished or rendered in connection with the
rental of real property of a similar class in the geographic areas in which the
properties are located where such services are either provided by (a) an
Independent Contractor (as defined in Section 856(d)(3) of the Code) who is
adequately compensated for such services and from which the Company does not,
directly or indirectly, derive revenue or (b) a taxable REIT subsidiary of KBS
(as defined in Section 856(l) of the Code) who is adequately compensated for
such services or (ii) amounts received for services that are customarily
furnished or rendered in connection with the rental of space for

40

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occupancy only (as opposed to being rendered primarily for the convenience of
the Company’s tenants);
(h)    Holding cash of the Company for operations or distribution in any manner
other than a traditional bank checking or savings account or a money market
account in accordance with IRS Rev. Rul. 2012-17; or
(i)    Entering into any agreement where income or gain, as applicable, received
or accrued by the Company under such agreement, directly or indirectly, (a) does
not qualify as “rents from real property” within the meaning of Section 856 of
the Code, (b) does not qualify as “interest on obligations secured by mortgages
on real property or on interests in real property” within the meaning of Section
856 of the Code or (c) constitutes income from a sale of “inventory” or “stock
in trade” of the Company within the meaning of Section 1221(a)(1) of the Code
other than a sale that would qualify under the Section 857(b)(6)(C) “safe
harbor” with respect to KBS.
[Remainder of page intentionally blank; signature page follows.]

41

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement effective as
of the day and year first above written.
“JV MEMBER”
 
 
SREF 110 WILLIAM JV III, LLC,
a Delaware limited liability company
 
 
By:
/s/ Nicholas Bienstock
Name:
Nicholas Bienstock
Title:
Authorized Signatory
 
 
 
 
 
 
Solely as to its express agreement Sections
2.2(d)(ii),2.06(e),3.01,3.07, 7.01(a) and 10.02:
 
 
"SAVANNA REAL ESTATE FUND III, L.P.,
 
SAVANNA REAL ESTATE FUND III, L.P.,
a Delaware limited partnership
 
 
By:
/s/ Nicholas Bienstock
Name:
Nicholas Bienstock
Title:
Authorized Signatory
 
 
 
 

 

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

“KBS”

KBS SOR 110 WILLIAM JV, LLC,
a Delaware limited liability company

By:    KBS SOR ACQUISITION XXV, LLC,
a Delaware limited liability company,
its sole member

By:    KBS SOR PROPERTIES, LLC,
a Delaware limited liability company,
its sole member

By:    KBS STRATEGIC OPPORTUNITY LIMITED PARTNERSHIP,
a Delaware limited partnership,
its sole member

By:    KBS STRATEGIC OPPORTUNITY REIT, INC.,
a Maryland corporation,
its sole general partner

By:     /s/ David E. Snyder         
David E. Snyder
Chief Financial Officer

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

Solely as to its express agreement Sections 2.02(e)(iii), 3.01, 3.07, 7.01(a),
and 10.02:

KBS SOR PROPERTIES, LLC,
a Delaware limited liability company, its sole member

By:    KBS STRATEGIC OPPORTUNITY LIMITED PARTNERSHIP,
a Delaware limited partnership,
its sole member

By:    KBS STRATEGIC OPPORTUNITY REIT, INC.,
a Maryland corporation,
its sole general partner

By:     /s/ David E. Snyder
David E. Snyder
Chief Financial Officer

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

EXHIBIT A
NAMES, ADDRESSES, PERCENTAGE INTERESTS
AND CAPITAL CONTRIBUTIONS OF THE MEMBERS
Names and Addresses of the Members:
Percentage Interest
Capital Contribution
KBS 110 William Street JV, LLC
620 Newport Center Drive, Suite 1300
Newport Beach, California 92660
Attention: Brian Ragsdale
Facsimile: (949) 417-6518
Email: bragsdale@kbs-ca.com

60%
$9,000,000

SREF III 110 William JV, LLC
10 East 53rd Street, 37th Floor
New York, NY 10022
Attn: Chris Schlank
Facsimile: (212) 229-1113
Email: CSchlank@savannafund.com

40%
$6,000,000

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EXHIBIT B
LEGAL DESCRIPTION OF THE PROPERTY
See Attached:

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EXHIBIT B

DESCRIPTION OF REAL PROPERTY

All that certain real property situated in New York County, New York, described
as follows:

ALL that certain plot piece or parcel of land, situate, lying and being in the
Borough of Manhattan, County and State of New York, bounded and described as
follows:
BEGINNING at the corner formed by the intersection of the easterly side of
William Street and the northerly side of John Street;
RUNNING THENCE northerly along the easterly side of William Street, 188 feet 3
inches to a point in said easterly side of William Street, distant 154 feet 10 1
/4 inches southerly from the corner formed by the intersection of the southerly
side of Fulton Street and the said easterly side of William Street;
THENCE easterly on a line forming an angle of 86 degrees 52 minutes 30 seconds
on its northerly side with the easterly side of William Street, 159 feet 4 1 /4
inches;
THENCE southwesterly on a line forming an angle of 82 degrees 44 minutes 30
seconds on its westerly side with the last mentioned course, 49 feet 5 inches;
THENCE continuing southwesterly on a line forming an angle of 180 degrees 49
minutes 30 seconds on its easterly side with the last mentioned course, 25 feet
7 1/2 inches;
THENCE continuing southwesterly along a line making an angle of 179 degrees 48
minutes on its easterly side with the last mentioned course, 23 feet 2 1/2
inches;
THENCE southeasterly and along a line forming an angle of 93 degrees 51 minutes
50 seconds on its northerly side with the last mentioned course, 24 feet 10 1 /4
inches;
THENCE southerly along a line forming an angle of 96 degrees 20 minutes 30
seconds on its westerly side with the last mentioned course, 104 feet 3 1 /4
inches to the northerly side of John Street;
THENCE westerly along the northerly side of John Street, 173 feet 4 1/4 inches
to the corner formed by the intersection of the northerly side of John Street
with the easterly side of William Street at the point or place of BEGINNING.

FOR CONVEYANCING ONLY: TOGETHER with all the right, title and interest of the
party of the first part, of
in and to the land lying in the street in front of and adjoining said premise

Exhibit A-1

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EXHIBIT C
SCHEDULE OF SOURCES AND USES OF FUNDS

See Attached:

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[kbssorq42013ex1018pg49.jpg]

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EXHIBIT D
INITIAL APPROVED ANNUAL BUDGET

See Attached:

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[kbssorq42013ex1018pg51.jpg]

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EXHIBIT E
FORM OF LEASING AGREEMENT

RENTAL AGENCY AGREEMENT
ARTICLE 1This Rental Agency Agreement (this “Agreement”) is made as of the [__]
day of [_______], 2013 by and between [______], a Delaware limited liability
company, having an office at c/o Savanna Real Estate Funds, 10 East 53rd Street,
37th Floor, New York, NY 10022 (“Owner” or “Landlord”) and Savanna Commercial
Services, LLC, a Delaware limited liability company, having an office at c/o
Savanna Real Estate Funds, 10 East 53rd Street, 37th Floor, New York, NY 10022
(“Agent”).
STATEMENT OF FACTS
ARTICLE 2Owner owns the fee simple interest in certain premises known as
[______________] located at [________] (the “Building”) and the land upon which
it is located (the “Land”).
ATRICLE 3Owner desires to employ Agent as the sole and exclusive renting agent
for certain rentable office space (the “Space” or “space”) in the Building, on
the terms and conditions hereinafter set forth.
ARTICLE4NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, Owner and Agent agree as follows:
ARTICLE 1
Term And Scope
Section 1.1    During the term of this Agreement, Agent is hereby appointed as
the sole and exclusive renting agent having the exclusive right to negotiate
lease extensions, lease expansions, relocations, renewals and other lease
related agreements in the Building by existing tenants in the Building, subject
to the provisions of this Agreement. Agent acknowledges and agrees that Brian
Reiver (the “Representative”) shall personally supervise such renting activities
in the Building. Agent shall have the right, from time to time, to replace the
Representative with any other agent or employee of Agent designated by Agent.
Everything done by Agent under the provisions of this Section 1 shall be done
solely as agent of Owner and not for its own account, and all obligations or
expenses incurred thereunder shall be for the account, on behalf and at the
expense of Owner, not Agent.
Section 1.2    The term of this Agreement shall be on a month to month basis,
commencing on the date hereof (the “Commencement Date”) and continuing
thereafter until the date (the “Expiration Date”) this Agreement shall be
terminated pursuant to the provisions of this Agreement. This Agreement may be
terminated: (x) at any time by Owner sending a written notice of termination to
Agent, in which event the term of this Agreement shall terminate effective upon
the receipt by Agent of such notice of termination; and (y) at any time by Agent
sending a written notice of termination to Owner in which event the term of this
Agreement shall terminate ninety (90) days after the sending of such notice of
termination.

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Section 1.3    This Agreement shall terminate automatically if:
(a)    all or substantially all of the Building is condemned or acquired by
eminent domain;
(b)    Owner or Agent files a petition for bankruptcy, reorganization or
arrangement under any federal or state statute, or makes an assignment for the
benefit of creditors, or takes advantage of any insolvency statute;
(c)    an involuntary petition of bankruptcy or insolvency under the laws of the
federal government or of any state is filed against Owner or Agent and Owner or
Agent, as the case may be, shall fail to dismiss the same within sixty (60)
days; or
(d)    Agent’s New York State real estate broker’s license is suspended or
revoked.
Section 1.4    Upon the termination or expiration of this Agreement, Agent shall
deliver to Owner, within ten (10) business days after such termination or
expiration, all records, contracts, leases, receipts for deposits, unpaid bills
and other papers or documents and all other items relating to the Building which
are the property of Owner which are in Agent’s possession.
Section 1.5    Agent acknowledges that this Agreement is subject and subordinate
to any mortgages now or hereafter in effect covering the Building or the Land
and to all renewals, replacements, modifications or extensions thereof (the
“Superior Mortgages”) and to each and every term and condition thereof.
Section 1.6    Owner acknowledges, however, that Agent is not an expert in and
is not responsible for any legal, regulatory, tax, accounting, engineering,
environmental or other technical matters, all of which shall be solely Owner's
responsibility.
ARTICLE 2
Renting
Section 2.1    Agent shall use commercially reasonable efforts to extend, renew
or secure leases of space in the Building, or to cause an existing tenant to
enter into a new lease of space in the Building, at the highest possible rental
rates and otherwise on terms most advantageous to Owner. Agent agrees to
participate in project meetings (at a location in Manhattan to be designated by
Owner) and telephone conferences regarding the status of the leasing activity at
the Building.
Section 2.2    Agent may solicit the cooperation of other real estate brokers in
the renting of space (herein referred to as “Outside Broker(s)”). Agent shall
cooperate with Outside Brokers and shall encourage their participation in the
renting of space. Unless otherwise directed by Owner in writing, Agent shall,
prior to delivery by Agent of any lease or extension or renewal of any lease to
an Outside Broker or tenant, request Outside Broker to execute a brokerage
agreement with Owner (a “Brokerage Agreement”) prepared by Owner’s counsel,
which shall provide for compensation to be paid to Outside Broker directly by
Owner, which compensation shall not exceed one full commission payable
hereunder. If directed by Owner in writing, until such Outside Broker shall have
executed a Brokerage Agreement with Owner, Agent shall cease further
negotiations with such Outside Broker or tenant. Agent agrees to send

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

a written notice terminating negotiations if requested by Owner to do so.
Section 2.3    Owner agrees to refer to Agent all offerings and inquiries
received by Owner from existing tenants of space in the Building, and Agent
agrees to diligently investigate and develop such offerings or inquiries and to
canvass, solicit and otherwise employ its services to endeavor at all times to
fully rent the applicable space.
ARTICLE 3
Compensation
Section 3.1    Subject to the provisions of this Agreement, with respect to
every renewal, extension, relocation or new lease with an existing tenant of
space in the Building entered into after the date hereof with respect to any
existing tenant (each, a “Lease Renewal or Modification”), Agent shall be
compensated by Owner in accordance with the provisions of this Article 3.
Section 3.2    Notwithstanding any provision of this Agreement to the contrary
and regardless of the extent to which negotiations may progress, in the event
that either: (a) such Lease Renewal or Modification fails to be consummated
and/or received and accepted by Landlord for any reason whatsoever, including,
but not limited to, any lack of any approval or consent that may be required
pursuant to the provisions of the applicable existing lease or such Lease
Renewal or Modification or required pursuant to the provisions of the Superior
Mortgages, or the refusal by Landlord to continue negotiations for any reason or
no reason; or (b) if tenant fails to pay the first regular rental payment, if
any, due upon execution and delivery of the Lease Renewal or Modification, or if
any of the Conditions (as hereinafter defined) are not satisfied, then, and in
such event, Agent shall not be entitled to any commission whatsoever in
connection with such Lease Renewal or Modification and all negotiations prior
thereto, and Agent hereby waives any claims or demands therefor.
Section 3.3    
(a)    In the event that (i) a Lease Renewal or Modification is actually
executed, delivered, received and accepted by Landlord and a tenant, (ii) all
conditions required to make such Lease Renewal or Modification become effective
have been satisfied including, but not limited to, delivery of any lease
guarantees, or consents by or agreements with the holders of any Superior
Mortgages, and (iii) the first monthly installment of rent and the security
deposit (if any) pursuant to the Lease Renewal or Modification have been paid
(collectively, the “Conditions”), then, provided that the outside third-party
brokerage firm acting as the exclusive broker for the Building (the “Exclusive
Broker”) is not entitled commission, Owner shall pay to Agent, as full
compensation for its services rendered in connection with such Lease Renewal or
Modification, 95% of one commission computed upon the initial term of the Lease
Renewal or Modification only, in accordance with the rates set forth in Schedule
A annexed hereto and the payment schedule set forth on Schedule B annexed
hereto; provided, that in the event that an Outside Broker (as hereinafter
defined) is entitled to a full commission in connection with such transaction
under this Section 3.3(a), Owner shall pay to Agent, for Agent’s own account, an
amount equal to 47.5% of one commission on the fixed rental to be received by
Owner during such Lease Renewal or

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Modification.
(b)    In the event that the initial term of the Lease Renewal or Modification
is renewed or extended, regardless of whether as a result of the exercise by
tenant of an option or right contained in the original lease or Lease Renewal or
Modification on the terms and conditions for such renewal or extension contained
in the original lease or Lease Renewal or Modification, and regardless of
whether this Agreement has expired or terminated, then, provided that the
Exclusive Broker (as hereinafter defined) is entitled to a commission, Owner
shall pay to Agent, subject to the provisions of Section 3.4 hereof, 15% of one
commission on the fixed rental to be received by Owner during the renewal or
extension period, in accordance with the rates set forth in Schedule A, computed
as if such renewal or extension term were part of the initial term of the Lease
Renewal or Modification; provided, that in the event that an Outside Broker is
entitled to a full commission in connection with such transaction under this
Section 3.3(b), Owner shall pay to Agent, for Agent’s own account, an amount
equal to 7.5% of one commission on the fixed rental to be received by Owner
during such Lease Renewal or Modification.
(c)    In the event of a new lease in the Building with any unaffiliated tenant
which is not a tenant of the Building or a tenant within Agent’s portfolio
(each, a “New Lease”), provided that this Agreement has not expired or
terminated, then Owner shall pay to Agent, subject to the provisions of Section
3.4 hereof, 20% of one full commission on the fixed rental to be received by
Owner during such New Lease, in accordance with the rates set forth in Schedule
A; provided, that in the event an Outside Broker is entitled to a full
commission in connection with such transaction under this Section 3.3(c), Owner
shall pay to Agent, for Agent’s own account, 10% of one commission on the fixed
rental to be received by Owner during such New Lease.
(d)    In the event of a relocation or new lease with any tenant within Agent’s
portfolio (which shall be defined as any building owned or controlled by an
affiliate of Agent) (each, a “Portfolio Lease”), and regardless of whether this
Agreement has expired or terminated, then, regardless of whether Agent was
entitled to a commission on the original Portfolio Lease, Owner shall pay to
Agent, subject to the provisions of Section 3.4 hereof, 95% of the difference
between (i) then then-market commission on the fixed rental to be received by
Owner during such Portfolio Lease and (ii) any commission payable to the
Exclusive Broker and/or any Outside Broker.
(e)    In the event of an expansion of leased space with an existing tenant of
space in the Building (each, an “Expansion Lease”), and this Agreement has not
expired or been terminated, then, regardless of whether Agent was entitled to a
commission on the original Expansion Lease, Owner shall pay to Agent, subject to
the provisions of Section 3.4 hereof, 95% of the difference between (i) then
then-market commission on the fixed rental to be received by Owner during such
Expansion Lease and (ii) any commission payable to the Exclusive Broker and/or
any Outside Broker.
(f)    Owner shall not be obligated to pay any compensation whatsoever to Agent
under the provisions of this Agreement in connection with any lease transaction
consummated between Owner and any affiliate or subsidiary thereof.

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Section 3.4    All commissions payable under this Agreement shall be subject to
the following provisions of this Section 3.4:
(a)    The commission shall be based upon the aggregate fixed rent or base rent
(the “Annual Fixed Rent”) payable by the tenant during the initial term of the
Lease Renewal or Modification only, limited as hereinafter provided. In the
event a Lease Renewal or Modification is consummated on a so-called “net” basis
so that real property taxes and costs of maintaining or operating the property
are included in Annual Fixed Rent, the amount of such items for the year in
which the Lease Renewal or Modification is executed, on a per square foot basis,
shall not be included in the Annual Fixed Rent per square foot in determining
the commission due hereunder.
(b)    If the Lease Renewal or Modification shall expressly provide for an
option by the Tenant to cancel the Lease Renewal or Modification prior to the
commencement of the term, then the first payment of such commission shall not be
payable until the time for the exercise of such option to cancel shall have
expired or shall have been waived in writing and, if the Lease Renewal or
Modification shall be cancelled pursuant to such option, no commissions shall be
due or payable therefor. If the Lease Renewal or Modification shall expressly
provide the tenant with an unilateral option to cancel subsequent to the
commencement of the term, then such commission shall be payable only for the
term of the Lease Renewal or Modification unaffected by the option to cancel; if
the option is waived in writing or not exercised within the time limit
permitted, then a commission shall be payable for the then balance of the term,
as if no such option to cancel had existed. Notwithstanding the above, if the
cancellation option expressly requires that the tenant make a payment
representing unamortized commission amounts, then, in such event only, following
such payment by tenant to Owner, Agent shall be paid its commission as provided
herein as if no such right to cancel existed; provided, however, that if the
cancellation payment made by tenant does not equal, in the aggregate, the amount
of such commission otherwise payable to Agent and all of Owner’s reasonable
expenses with respect to such lease, then the amount of the commission to be
paid to Agent shall be determined on a pro rata basis.
(c)    In determining the Annual Fixed Rent for the purpose of computing
commissions due hereunder, items (i), (ii), (iii), (iv) and (v) below (whether
or not referred to in the Lease Renewal or Modification as rent or additional
rent and whether or not included in the Annual Fixed Rent) shall be excluded and
items (vi) and (vii) shall be deducted:
(i)    Charges, if any, payable by tenant for utilities or utility services to
be supplied to tenant, including, without limitation, electricity charges;
(ii)    Any payment to be made by tenant (A) pursuant to any cost of living
(Price Index) formulae, or (B) on account of increases in real estate taxes,
wages or labor costs of maintaining and operating the Building in which the
demised premises are located (other than fixed increases in base rent), or (C)
pursuant to any other escalation formulae which increases the Annual Fixed Rent
other than a percentage increase to Annual Fixed Rent;
(iii)    Any payments to be made by tenant on account of work, labor or
materials furnished by Landlord in excess of Owner’s standard landlord work
letter;

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(iv)    Any payments to be made based upon tenant’s gross receipts, (commonly
referred to as Percentage Rental), provided, however, that if there is no Annual
Fixed Rent payable under the terms of the Lease Renewal or Modification, and in
lieu thereof, tenant’s rent is based upon a percentage of tenant’s gross
receipts, then, and only in such event, shall the commission be payable on such
Percentage Rental when determined and pursuant to all of the other terms of this
Agreement;
(v)    Any payments to be made by tenant in addition to Annual Fixed Rent;
(vi)    All costs and expenses actually assumed or incurred by Landlord, if any,
(A) in connection with tenant’s lease obligations for space rented by tenant
from others outside the Building including, without limitation, expenses
incurred in reletting such space or (B) in connection with any take-back of
Space in the Building in connection with any Lease Renewal or Modification,
including, without limitation, expenses incurred in reletting such space; and
(vii)    Rent concessions granted by Landlord amortized on a straight-line basis
over the term of the Lease Renewal or Modification, other than rent concessions
granted in lieu of, and not in excess of, Landlord’s standard work letter or
standard allowance for tenant improvements for that particular space in the
Building.
(d)    Subject to the provisions of subdivision (a) of this Section 3.4 above,
all commissions (except for any payments made directly to Outside Brokers
pursuant to any Brokerage Agreements between Owner and such Outside Brokers),
including overriding commissions, shall be payable to Agent in accordance with
the provisions of Schedule B annexed hereto and made a part hereof.
Section 3.5    Notwithstanding anything in this Agreement to the contrary, the
relocation of a tenant within the Building upon substantially the same terms and
conditions as set forth in such tenant’s existing Lease Renewal or Modification
shall not result in any additional commission being payable to Agent unless the
term of the subject Lease Renewal or Modification is extended or additional
space is taken and, in such event, the provisions of Section 3.3 shall control
with respect to such additional space or extended term. Should a tenant relocate
within the Building and the terms and conditions of such tenant’s Lease Renewal
or Modification be modified in connection with the relocation so as to result in
an increase in total fixed rental payable, Owner shall pay Agent a commission on
any increase in fixed rental to be received as a result of the relocation in
accordance with the provisions of Section 3.3. In the event a Lease Renewal or
Modification is entered into with an existing tenant for space then under lease
to another existing tenant whose lease will thereby terminate prior to the
stated expiration date, Owner shall pay to Agent a commission with respect to
such new Lease Renewal or Modification in accordance with the provisions of
Section 3.3. However, in the event such a situation should arise, Owner shall be
entitled to credit against any commission due Agent an amount equal to the pro
rata portion of the commission theretofore paid to Agent with respect to the
unexpired portion of the term of the existing lease, provided Owner had
initially paid the commission pertaining to the unexpired portion of the term,
and Owner and Agent shall use reasonable efforts to secure a fee directly from
the then existing tenant of the applicable space in consideration for the
termination

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of such existing tenant’s lease and any fee or consideration so received by
Agent shall be offset, penny for penny, against the commission due and payable
by Owner resulting from the new Lease Renewal or Modification.
Section 3.6    Notwithstanding anything in this Agreement to the contrary, for
the purposes of the calculation of any commissions under Section 3.3 above,
“Outside Broker” shall include any broker, representative or affiliate of Agent
and any other division of Agent, the employees of which are not working directly
with the Representative on this assignment, provided that if Agent or any
affiliate of Agent is also the Outside Broker in a lease transaction, Owner
shall not be obligated to pay more than 95% of one commission in the aggregate,
determined in accordance with the provisions of this Agreement, in connection
with such transaction.
Section 3.7    Agent acknowledges that, if a rental agency, brokerage or other
agreement between Owner and another leasing agent with respect to the Building
is in effect as of the date hereof (an “Existing Agreement”), then such leasing
agent may be entitled to a commission with respect to any Lease Renewal or
Modification pursuant to the terms of such Existing Agreement. Agent further
acknowledges that a former leasing agent for the Building may claim that it is
entitled to be paid a commission with respect to any Lease Renewal or
Modification entered into with the entities listed on Schedule C annexed hereto
for the space so indicated on Schedule C. Accordingly, notwithstanding anything
in this Agreement to the contrary, if Owner enters into a Lease Renewal or
Modification with any entity set forth on the attached Schedule C for the space
so indicated on said Schedule C within six (6) months after the Commencement
Date, and the former leasing agent for the Building is entitled to be paid a
commission with respect to such Lease Renewal or Modification, then Agent shall
neither seek nor accept a commission hereunder in connection with such Lease
Renewal or Modification.
Section 3.8    The following provisions shall apply to any Lease Renewal or
Modification executed and delivered after the expiration or termination of this
Agreement:
(a)    Within thirty (30) days after the Expiration Date of this Agreement,
Agent shall deliver to Owner a complete list (the “Pending List”) of any
potential Lease Renewal or Modification with respect to which, at the request of
Owner, a term sheet or letter of intent has been delivered to the applicable
tenant, and such tenant has provided written comments on, or otherwise responded
in writing to such term sheet or letter of intent as of the Expiration Date of
this Agreement. If, within twelve (12) months after the Expiration Date of this
Agreement (the “Tail Period”), (i) Owner and the applicable tenant execute and
deliver a Lease Renewal or Modification with respect to any transaction
identified on the Pending List, (ii) such Lease Renewal or Modification is on
terms substantially similar to those contained in the last draft of the term
sheet or letter of intent that was delivered to the applicable tenant as of the
Expiration Date of this Agreement, and (iii) the Conditions are satisfied with
respect to such Lease Renewal or Modification, then Owner shall pay to Agent a
commission in accordance with the terms, covenants and conditions of this
Agreement. Notwithstanding the aforesaid, Agent shall not be entitled to any
compensation pursuant to this Agreement and the same is hereby waived if the
potential Lease Renewal or Modification is not actually executed and delivered
by Owner and the applicable tenant within the Tail Period; provided that Owner
shall use good faith reasonable efforts to negotiate and execute such Lease
Renewal or

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Modification within the Tail Period.
(b)    Owner’s obligation to pay any leasing commissions to Agent that have been
earned by Agent pursuant to the provisions hereof, but not yet payable,
including any Lease Renewal or Modification entered into prior to the expiration
or termination of this Ageeement, shall survive the expiration or termination of
this Agreement.
Section 3.9    Agent’s acceptance of compensation with respect to any Lease
Renewal or Modification shall be deemed a representation that Agent is entitled
to a commission in accordance with the terms hereof. Notwithstanding the
termination of this Agreement, Agent agrees at all times, with respect to any
Lease Renewal or Modification, to hold Owner, and its direct and indirect
partners, principals, members, officers, directors, employees and affiliates
harmless against any and all liability, loss, damage and expense (including
reasonable attorneys’ fees and disbursements) arising out of or otherwise
relating to claims for commissions on such Lease Renewal or Modification by any
other broker including but not limited to any Outside Broker, alleging to have
dealt with or through Agent arising out of alleged negotiations or conversations
had by Agent or Agent and Owner jointly (but not by Owner without the
participation of Agent), with the claimant broker. Agent’s liability under the
foregoing indemnity shall be limited to the money received by it from Owner on
the particular Lease Renewal or Modification transaction upon which a claim is
being made; provided, however, if Owner elects to pay an Outside Broker directly
pursuant to the terms of a separate Brokerage Agreement, then, subject to the
provisions of this Agreement, Owner shall be responsible for the commission to
which such Outside Broker is entitled pursuant to such Brokerage Agreement
between Owner and such Outside Broker. Owner agrees to use reasonable efforts to
have any commission agreement executed by an Outside Broker contain a provision
whereby such Outside Broker (i) represents, if correct, that such Outside Broker
and Agent were the sole brokers instrumental in consummating a Lease Renewal or
Modification with the tenant dealing with such Outside Broker; and (ii)
indemnifies and holds Owner and Agent harmless from and against any liability
arising from the incorrectness (actual or alleged) of such representation.
ARTICLE 4
Miscellaneous
Section 4.1    Agent will make available to Owner the advice and consultation of
its staff throughout the term of this Agreement for any reason reasonably
related to this Agreement and which would customarily be provided by a
first-class leasing agent in New York City, including, but not limited to, the
occupancy of the tenants within the Building. Nothing herein, however, shall be
construed to provide that Agent shall perform or provide professional legal
services. Within fifteen (15) days after the date hereof Agent shall submit to
Owner Agent’s initial marketing and leasing plan, on a floor by floor basis, for
the Building and Agent’s estimate of Owner’s future lease up costs. Agent shall
periodically, and no less than monthly, update such marketing and leasing plan
and shall include therein the Representative’s advice as to market trend rates
and comparative rents for leases being signed in the market in which the
Building is competing.
Section 4.2    The Representative shall conduct meetings with Owner to discuss
the activities to be conducted by Agent hereunder at such times as Owner may
reasonably request. Additionally, at any such meeting or upon Owner’s request,
Agent will provide to

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Owner a written report as to any telephone inquiries and the status of any
negotiations with respect to any space in the Building for the prior week.
Section 4.3    This Agreement may be assigned by Owner to its grantee upon the
sale of the Building and upon the assignee’s unconditional assumption in writing
of this Agreement. Owner shall thereupon be relieved of any liability hereunder
except to the extent such liability accrued prior to the date of assignment.
Section 4.4    Any disagreement between Owner and Agent with respect to the
interpretation or construction of this Agreement or the obligations of the
parties hereunder shall be determined by arbitration. Such arbitration shall be
conducted, upon request of either Owner or Agent, before three (3) arbitrators
(unless Owner and Agent agree to one (1) arbitrator) designated by the American
Arbitration Association and in accordance with the rules of such Association.
The arbitrators designated and acting under this Agreement shall make an award
in strict conformity with such rules and shall have no power to depart from or
change any of the provisions hereof. The expense of arbitration proceedings
conducted hereunder shall be borne by the non-prevailing party. All arbitration
proceedings conducted hereunder shall be conducted in the City of New York.
Section 4.5    This Agreement contains the entire understanding of the parties.
Agent may not assign this Agreement nor may Agent assign its rights, duties or
obligations under this Agreement. This Agreement may not be changed or modified
orally but only by written instrument signed by the parties. This Agreement
shall be binding upon and inure to the benefit of the successors and, except as
may expressly otherwise be provided herein, the assigns of the respective
parties hereto.
Section 4.6    This Agreement shall be construed and interpreted in accordance
with the laws of the State of New York.
Section 4.7    All notices sent pursuant to the terms of this Agreement, in
order for same to be effective, must be sent by certified or registered mail,
return receipt requested, or by nationally recognized overnight carrier
providing for receipted delivery as follows:
Any required notices to Agent shall be directed to:
Savanna Commercial Services, LLC
c/o Savanna Real Estate Funds
10 East 53rd Street, 37th Floor
New York, New York 10022
Attention: Brian Reiver
E-mail:     breiver@savannafund.com
Telephone: 212-600-2517

with a copy to:
McDermott Will & Emery LLP
340 Madison Avenue
New York, New York 10173

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Attention: William E. Stempel, Esq.
E-mail:     wstempel@mwe.com
Telephone: 212-547-5623

Any required notices to Owner shall be directed to:
[____________]
c/o Savanna Real Estate Fund II
10 East 53rd Street, 37th Floor
New York, New York 10022
Attention: Nicholas C. Bienstock
E-mail:     nbienstock@savannafund.com
Telephone: 212-229-0101
with a copy to:
Savanna Real Estate Fund II
10 East 53rd Street, 37th Floor
New York, New York 10022
Attention: Christopher Schlank
E-mail:     cschlank@savannafund.com
Telephone: 212-229-0101
Section 4.8    The term “Agent” as used in this Agreement shall include any
corporate subsidiaries or affiliates of Agent who perform services on behalf of
Owner in, on or about the Building in connection with this Agreement.
Section 4.9    Owner shall indemnify, defend (or reimburse Agent’s reasonable
defense costs) and hold Agent, its affiliates assisting Agent in providing
services to Owner under this Agreement, their members, shareholders, directors,
officers and employees (collectively, the “Indemnified Parties”) harmless for
any and all loss, claims, demands, penalties, damages, liabilities, costs and
expenses, statutory or otherwise, including reasonable attorney’s fees and
expenses, arising from this Agreement, whether paid, incurred by, or asserted
against an Indemnified Party, hereinafter collectively called “claims”, for
injury to any persons or property in, about and in connection with the Building,
and from any cause whatsoever or which may arise after the termination of this
Agreement by reason of actions of persons or entities other than Agent, unless
caused by Agent’s willful misconduct in performance of its duties hereunder. The
foregoing indemnity shall not apply to the extent any loss, claims, demands,
penalties, damages, liabilities, costs and expenses result from the gross
negligence or willful acts of any of the Indemnified Parties. Agent agrees to
indemnify and hold Principal harmless from and against any and all “claims” (as
such term is defined in this Section 4.9), resulting from the acts, or failure
to act, of Agent, its agents or employees which acts or failure to act
constitute gross negligence or willful misconduct. It is expressly understood
and agreed that this Sections 4.9 shall survive the termination of this
Agreement.
Section 4.10    Agent shall not be entitled to any compensation from Owner of
any nature whatsoever except as may be expressly and specifically provided in
this Agreement. The term “compensation” as used herein, shall be deemed to
include any and all types of fees,

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commissions, reimbursements, etc.
Section 4.11    Notwithstanding anything to the contrary in this Agreement,
Agent shall look only to Owner’s estate in the Building and the land on which
the same is situated (or the rental income or sales and insurance proceeds
thereof) for the satisfaction of Agent’s remedies for the collection of any
judgment (or other judicial process) requiring the payment of money by Owner in
the event of any material breach of this Agreement by Owner, and no other
property or assets of Owner or its partners or principals, disclosed or
undisclosed, shall be subject to levy, execution or other enforcement procedure
for the satisfaction of Agent’s remedies under or with respect to this
Agreement, the relationship of Owner and Agent hereunder or under law or any
other liability of Owner to Agent.
Section 4.12    Agent may, at its sole cost and expense, furnish, install and
maintain during the term hereof, a sign identifying it as the leasing agent for
the Building, subject to the prior written consent of Owner as to size, type,
material, manner of installation and location not to be unreasonably withheld.
Such sign shall be removed, at Agent’s sole cost and expense, upon the
expiration or termination of this Agreement and Agent, at its sole cost and
expense, shall repair any damage caused by such removal, wear and tear excepted.
Section 4.13    Notwithstanding anything in this Agreement to the contrary,
Agent is not authorized, and shall have no right, to execute any Lease Renewal
or Modification, amendments of lease, letters of intent or other instruments or
documents on behalf of Owner. Any term sheet prepared by Agent shall not be sent
or delivered to any prospective tenant or Outside Broker without the prior
written approval of Owner and such term sheet shall state that it is subject to
the execution and delivery of lease documents satisfactory to Owner in its sole
discretion. Additionally, Agent is not authorized, and shall have no right, to
make any representations or warranties with respect to the Building on behalf of
Owner.
[Signature page follows.]

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IN WITNESS WHEREOF, the parties have hereunto set their hands and seals as of
the day and year first above written.

OWNER:    [__________________]
a Delaware limited liability company

By:    ________________________
Name: Nicholas Bienstock
Title: Manager

AGENT:    Savanna Commercial Services, LLC,
a Delaware limited liability company
By:    _________________________
Name: Brian Reiver
Title: Director of Leasing

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SCHEDULE A
Based Upon Annual Fixed Rent

On the first year or any fraction thereof    5%
On the second year or any fraction thereof    4%
On the third year up to and including the fifth year    3½%
On the sixth year up to and including the tenth year    2½%
On the eleventh year up to and including the twentieth year    2%
On the twenty-first year and thereafter    1%

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SCHEDULE B

Payout Terms

100% of such commission upon the unconditional execution and delivery of the
Lease Renewal or Modification by Owner and the tenant and the obtaining of all
required consents and approvals necessary for the Lease Renewal or Modification
to become effective.S

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SCHEDULE C

Exclusion List

N/A

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EXHIBIT F
FORM OF RENEWAL LEASING AGREEMENT
RENTAL AGENCY AGREEMENT
This Rental Agency Agreement (this “Agreement”) is made as of the [__] day of
[_______], 2013 by and between [______], a Delaware limited liability company,
having an office at c/o Savanna Real Estate Funds, 10 East 53rd Street, 37th
Floor, New York, NY 10022 (“Owner” or “Landlord”) and Savanna Commercial
Services, LLC, a Delaware limited liability company, having an office at c/o
Savanna Real Estate Funds, 10 East 53rd Street, 37th Floor, New York, NY 10022
(“Agent”).
STATEMENT OF FACTS
Owner owns the fee simple interest in certain premises known as [______________]
located at [________] (the “Building”) and the land upon which it is located
(the “Land”).
Owner desires to employ Agent as the sole and exclusive renting agent for
certain rentable office space (the “Space” or “space”) in the Building, on the
terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual promises and covenants contained
herein, Owner and Agent agree as follows:
ARTILE 1
Term And Scope
Section 1.1    During the term of this Agreement, Agent is hereby appointed as
the sole and exclusive renting agent having the exclusive right to negotiate
lease extensions, lease expansions, relocations, renewals and other lease
related agreements in the Building by existing tenants in the Building, subject
to the provisions of this Agreement. Agent acknowledges and agrees that Brian
Reiver (the “Representative”) shall personally supervise such renting activities
in the Building. Agent shall have the right, from time to time, to replace the
Representative with any other agent or employee of Agent designated by Agent.
Everything done by Agent under the provisions of this Section 1 shall be done
solely as agent of Owner and not for its own account, and all obligations or
expenses incurred thereunder shall be for the account, on behalf and at the
expense of Owner, not Agent.
Section 1.2    The term of this Agreement shall be on a month to month basis,
commencing on the date hereof (the “Commencement Date”) and continuing
thereafter until the date (the “Expiration Date”) this Agreement shall be
terminated pursuant to the provisions of this Agreement. This Agreement may be
terminated: (x) at any time by Owner sending a written notice of termination to
Agent, in which event the term of this Agreement shall terminate effective upon
the receipt by Agent of such notice of termination; and (y) at any time by Agent
sending a written notice of termination to Owner in which event the term of this
Agreement shall terminate ninety (90) days after the sending of such notice of
termination.
Section 1.3    This Agreement shall terminate automatically if:
(a)    all or substantially all of the Building is condemned or acquired by
eminent domain;

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(b)    Owner or Agent files a petition for bankruptcy, reorganization or
arrangement under any federal or state statute, or makes an assignment for the
benefit of creditors, or takes advantage of any insolvency statute;
(c)    an involuntary petition of bankruptcy or insolvency under the laws of the
federal government or of any state is filed against Owner or Agent and Owner or
Agent, as the case may be, shall fail to dismiss the same within sixty (60)
days; or
(d)    Agent’s New York State real estate broker’s license is suspended or
revoked.
Section 1.4    Upon the termination or expiration of this Agreement, Agent shall
deliver to Owner, within ten (10) business days after such termination or
expiration, all records, contracts, leases, receipts for deposits, unpaid bills
and other papers or documents and all other items relating to the Building which
are the property of Owner which are in Agent’s possession.
Section 1.5    Agent acknowledges that this Agreement is subject and subordinate
to any mortgages now or hereafter in effect covering the Building or the Land
and to all renewals, replacements, modifications or extensions thereof (the
“Superior Mortgages”) and to each and every term and condition thereof.
Section 1.6    Owner acknowledges, however, that Agent is not an expert in and
is not responsible for any legal, regulatory, tax, accounting, engineering,
environmental or other technical matters, all of which shall be solely Owner's
responsibility.
ARTICLE 2
Renting
Section 2.1    Agent shall use commercially reasonable efforts to extend, renew
or secure leases of space in the Building, or to cause an existing tenant to
enter into a new lease of space in the Building, at the highest possible rental
rates and otherwise on terms most advantageous to Owner. Agent agrees to
participate in project meetings (at a location in Manhattan to be designated by
Owner) and telephone conferences regarding the status of the leasing activity at
the Building.
Section 2.2    Agent may solicit the cooperation of other real estate brokers in
the renting of space (herein referred to as “Outside Broker(s)”). Agent shall
cooperate with Outside Brokers and shall encourage their participation in the
renting of space. Unless otherwise directed by Owner in writing, Agent shall,
prior to delivery by Agent of any lease or extension or renewal of any lease to
an Outside Broker or tenant, request Outside Broker to execute a brokerage
agreement with Owner (a “Brokerage Agreement”) prepared by Owner’s counsel,
which shall provide for compensation to be paid to Outside Broker directly by
Owner, which compensation shall not exceed one full commission payable
hereunder. If directed by Owner in writing, until such Outside Broker shall have
executed a Brokerage Agreement with Owner, Agent shall cease further
negotiations with such Outside Broker or tenant. Agent agrees to send a written
notice terminating negotiations if requested by Owner to do so.
Section 2.3    Owner agrees to refer to Agent all offerings and inquiries
received by Owner from existing tenants of space in the Building, and Agent
agrees to diligently

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investigate and develop such offerings or inquiries and to canvass, solicit and
otherwise employ its services to endeavor at all times to fully rent the
applicable space.
ARTICLE 3
Compensation
Section 3.1    Subject to the provisions of this Agreement, with respect to
every renewal, extension, relocation or new lease with an existing tenant of
space in the Building entered into after the date hereof with respect to any
existing tenant (each, a “Lease Renewal or Modification”), Agent shall be
compensated by Owner in accordance with the provisions of this Article 3.
Section 3.2    Notwithstanding any provision of this Agreement to the contrary
and regardless of the extent to which negotiations may progress, in the event
that either: (a) such Lease Renewal or Modification fails to be consummated
and/or received and accepted by Landlord for any reason whatsoever, including,
but not limited to, any lack of any approval or consent that may be required
pursuant to the provisions of the applicable existing lease or such Lease
Renewal or Modification or required pursuant to the provisions of the Superior
Mortgages, or the refusal by Landlord to continue negotiations for any reason or
no reason; or (b) if tenant fails to pay the first regular rental payment, if
any, due upon execution and delivery of the Lease Renewal or Modification, or if
any of the Conditions (as hereinafter defined) are not satisfied, then, and in
such event, Agent shall not be entitled to any commission whatsoever in
connection with such Lease Renewal or Modification and all negotiations prior
thereto, and Agent hereby waives any claims or demands therefor.
Section 3.3    
(a)    In the event that (i) a Lease Renewal or Modification is actually
executed, delivered, received and accepted by Landlord and a tenant, (ii) all
conditions required to make such Lease Renewal or Modification become effective
have been satisfied including, but not limited to, delivery of any lease
guarantees, or consents by or agreements with the holders of any Superior
Mortgages, and (iii) the first monthly installment of rent and the security
deposit (if any) pursuant to the Lease Renewal or Modification have been paid
(collectively, the “Conditions”), then, provided that the outside third-party
brokerage firm acting as the exclusive broker for the Building (the “Exclusive
Broker”) is not entitled commission, Owner shall pay to Agent, as full
compensation for its services rendered in connection with such Lease Renewal or
Modification, 95% of one commission computed upon the initial term of the Lease
Renewal or Modification only, in accordance with the rates set forth in Schedule
A annexed hereto and the payment schedule set forth on Schedule B annexed
hereto; provided, that in the event that an Outside Broker (as hereinafter
defined) is entitled to a full commission in connection with such transaction
under this Section 3.3(a), Owner shall pay to Agent, for Agent’s own account, an
amount equal to 47.5% of one commission on the fixed rental to be received by
Owner during such Lease Renewal or Modification.
(b)    In the event that the initial term of the Lease Renewal or Modification
is renewed or extended, regardless of whether as a result of the exercise by

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tenant of an option or right contained in the original lease or Lease Renewal or
Modification on the terms and conditions for such renewal or extension contained
in the original lease or Lease Renewal or Modification, and regardless of
whether this Agreement has expired or terminated, then, provided that the
Exclusive Broker (as hereinafter defined) is entitled to a commission, Owner
shall pay to Agent, subject to the provisions of Section 3.4 hereof, 15% of one
commission on the fixed rental to be received by Owner during the renewal or
extension period, in accordance with the rates set forth in Schedule A, computed
as if such renewal or extension term were part of the initial term of the Lease
Renewal or Modification; provided, that in the event that an Outside Broker is
entitled to a full commission in connection with such transaction under this
Section 3.3(b), Owner shall pay to Agent, for Agent’s own account, an amount
equal to 7.5% of one commission on the fixed rental to be received by Owner
during such Lease Renewal or Modification.
(c)    In the event of a new lease in the Building with any unaffiliated tenant
which is not a tenant of the Building or a tenant within Agent’s portfolio
(each, a “New Lease”), provided that this Agreement has not expired or
terminated, then Owner shall pay to Agent, subject to the provisions of Section
3.4 hereof, 20% of one full commission on the fixed rental to be received by
Owner during such New Lease, in accordance with the rates set forth in Schedule
A; provided, that in the event an Outside Broker is entitled to a full
commission in connection with such transaction under this Section 3.3(c), Owner
shall pay to Agent, for Agent’s own account, 10% of one commission on the fixed
rental to be received by Owner during such New Lease.
(d)    In the event of a relocation or new lease with any tenant within Agent’s
portfolio (which shall be defined as any building owned or controlled by an
affiliate of Agent) (each, a “Portfolio Lease”), and regardless of whether this
Agreement has expired or terminated, then, regardless of whether Agent was
entitled to a commission on the original Portfolio Lease, Owner shall pay to
Agent, subject to the provisions of Section 3.4 hereof, 95% of the difference
between (i) then then-market commission on the fixed rental to be received by
Owner during such Portfolio Lease and (ii) any commission payable to the
Exclusive Broker and/or any Outside Broker.
(e)    In the event of an expansion of leased space with an existing tenant of
space in the Building (each, an “Expansion Lease”), and this Agreement has not
expired or been terminated, then, regardless of whether Agent was entitled to a
commission on the original Expansion Lease, Owner shall pay to Agent, subject to
the provisions of Section 3.4 hereof, 95% of the difference between (i) then
then-market commission on the fixed rental to be received by Owner during such
Expansion Lease and (ii) any commission payable to the Exclusive Broker and/or
any Outside Broker.
(f)    Owner shall not be obligated to pay any compensation whatsoever to Agent
under the provisions of this Agreement in connection with any lease transaction
consummated between Owner and any affiliate or subsidiary thereof.
Section 3.4    All commissions payable under this Agreement shall be subject to
the following provisions of this Section 3.4:
(a)    The commission shall be based upon the aggregate fixed rent or base rent
(the “Annual Fixed Rent”) payable by the tenant during the initial term of the
Lease Renewal or Modification only, limited as hereinafter provided. In the
event a Lease

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Renewal or Modification is consummated on a so-called “net” basis so that real
property taxes and costs of maintaining or operating the property are included
in Annual Fixed Rent, the amount of such items for the year in which the Lease
Renewal or Modification is executed, on a per square foot basis, shall not be
included in the Annual Fixed Rent per square foot in determining the commission
due hereunder.
(b)    If the Lease Renewal or Modification shall expressly provide for an
option by the Tenant to cancel the Lease Renewal or Modification prior to the
commencement of the term, then the first payment of such commission shall not be
payable until the time for the exercise of such option to cancel shall have
expired or shall have been waived in writing and, if the Lease Renewal or
Modification shall be cancelled pursuant to such option, no commissions shall be
due or payable therefor. If the Lease Renewal or Modification shall expressly
provide the tenant with an unilateral option to cancel subsequent to the
commencement of the term, then such commission shall be payable only for the
term of the Lease Renewal or Modification unaffected by the option to cancel; if
the option is waived in writing or not exercised within the time limit
permitted, then a commission shall be payable for the then balance of the term,
as if no such option to cancel had existed. Notwithstanding the above, if the
cancellation option expressly requires that the tenant make a payment
representing unamortized commission amounts, then, in such event only, following
such payment by tenant to Owner, Agent shall be paid its commission as provided
herein as if no such right to cancel existed; provided, however, that if the
cancellation payment made by tenant does not equal, in the aggregate, the amount
of such commission otherwise payable to Agent and all of Owner’s reasonable
expenses with respect to such lease, then the amount of the commission to be
paid to Agent shall be determined on a pro rata basis.
(c)    In determining the Annual Fixed Rent for the purpose of computing
commissions due hereunder, items (i), (ii), (iii), (iv) and (v) below (whether
or not referred to in the Lease Renewal or Modification as rent or additional
rent and whether or not included in the Annual Fixed Rent) shall be excluded and
items (vi) and (vii) shall be deducted:
(i)    Charges, if any, payable by tenant for utilities or utility services to
be supplied to tenant, including, without limitation, electricity charges;
(ii)    Any payment to be made by tenant (A) pursuant to any cost of living
(Price Index) formulae, or (B) on account of increases in real estate taxes,
wages or labor costs of maintaining and operating the Building in which the
demised premises are located (other than fixed increases in base rent), or (C)
pursuant to any other escalation formulae which increases the Annual Fixed Rent
other than a percentage increase to Annual Fixed Rent;
(iii)    Any payments to be made by tenant on account of work, labor or
materials furnished by Landlord in excess of Owner’s standard landlord work
letter;
(iv)    Any payments to be made based upon tenant’s gross receipts, (commonly
referred to as Percentage Rental), provided, however, that if there is no Annual
Fixed Rent payable under the terms of the Lease Renewal or Modification, and in
lieu thereof, tenant’s rent is based upon a percentage of tenant’s gross
receipts, then, and only in such event, shall the commission be payable on such
Percentage Rental when determined and pursuant to all of the

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other terms of this Agreement;
(v)    Any payments to be made by tenant in addition to Annual Fixed Rent;
(vi)    All costs and expenses actually assumed or incurred by Landlord, if any,
(A) in connection with tenant’s lease obligations for space rented by tenant
from others outside the Building including, without limitation, expenses
incurred in reletting such space or (B) in connection with any take-back of
Space in the Building in connection with any Lease Renewal or Modification,
including, without limitation, expenses incurred in reletting such space; and
(vii)    Rent concessions granted by Landlord amortized on a straight-line basis
over the term of the Lease Renewal or Modification, other than rent concessions
granted in lieu of, and not in excess of, Landlord’s standard work letter or
standard allowance for tenant improvements for that particular space in the
Building.
(d)    Subject to the provisions of subdivision (a) of this Section 3.4 above,
all commissions (except for any payments made directly to Outside Brokers
pursuant to any Brokerage Agreements between Owner and such Outside Brokers),
including overriding commissions, shall be payable to Agent in accordance with
the provisions of Schedule B annexed hereto and made a part hereof.
Section 3.5    Notwithstanding anything in this Agreement to the contrary, the
relocation of a tenant within the Building upon substantially the same terms and
conditions as set forth in such tenant’s existing Lease Renewal or Modification
shall not result in any additional commission being payable to Agent unless the
term of the subject Lease Renewal or Modification is extended or additional
space is taken and, in such event, the provisions of Section 3.3 shall control
with respect to such additional space or extended term. Should a tenant relocate
within the Building and the terms and conditions of such tenant’s Lease Renewal
or Modification be modified in connection with the relocation so as to result in
an increase in total fixed rental payable, Owner shall pay Agent a commission on
any increase in fixed rental to be received as a result of the relocation in
accordance with the provisions of Section 3.3. In the event a Lease Renewal or
Modification is entered into with an existing tenant for space then under lease
to another existing tenant whose lease will thereby terminate prior to the
stated expiration date, Owner shall pay to Agent a commission with respect to
such new Lease Renewal or Modification in accordance with the provisions of
Section 3.3. However, in the event such a situation should arise, Owner shall be
entitled to credit against any commission due Agent an amount equal to the pro
rata portion of the commission theretofore paid to Agent with respect to the
unexpired portion of the term of the existing lease, provided Owner had
initially paid the commission pertaining to the unexpired portion of the term,
and Owner and Agent shall use reasonable efforts to secure a fee directly from
the then existing tenant of the applicable space in consideration for the
termination of such existing tenant’s lease and any fee or consideration so
received by Agent shall be offset, penny for penny, against the commission due
and payable by Owner resulting from the new Lease Renewal or Modification.
Section 3.6    Notwithstanding anything in this Agreement to the contrary, for
the purposes of the calculation of any commissions under Section 3.3 above,
“Outside Broker” shall include any broker, representative or affiliate of Agent
and any

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other division of Agent, the employees of which are not working directly with
the Representative on this assignment, provided that if Agent or any affiliate
of Agent is also the Outside Broker in a lease transaction, Owner shall not be
obligated to pay more than 95% of one commission in the aggregate, determined in
accordance with the provisions of this Agreement, in connection with such
transaction.
Section 3.7    Agent acknowledges that, if a rental agency, brokerage or other
agreement between Owner and another leasing agent with respect to the Building
is in effect as of the date hereof (an “Existing Agreement”), then such leasing
agent may be entitled to a commission with respect to any Lease Renewal or
Modification pursuant to the terms of such Existing Agreement. Agent further
acknowledges that a former leasing agent for the Building may claim that it is
entitled to be paid a commission with respect to any Lease Renewal or
Modification entered into with the entities listed on Schedule C annexed hereto
for the space so indicated on Schedule C. Accordingly, notwithstanding anything
in this Agreement to the contrary, if Owner enters into a Lease Renewal or
Modification with any entity set forth on the attached Schedule C for the space
so indicated on said Schedule C within six (6) months after the Commencement
Date, and the former leasing agent for the Building is entitled to be paid a
commission with respect to such Lease Renewal or Modification, then Agent shall
neither seek nor accept a commission hereunder in connection with such Lease
Renewal or Modification.
Section 3.8    The following provisions shall apply to any Lease Renewal or
Modification executed and delivered after the expiration or termination of this
Agreement:
(a)    Within thirty (30) days after the Expiration Date of this Agreement,
Agent shall deliver to Owner a complete list (the “Pending List”) of any
potential Lease Renewal or Modification with respect to which, at the request of
Owner, a term sheet or letter of intent has been delivered to the applicable
tenant, and such tenant has provided written comments on, or otherwise responded
in writing to such term sheet or letter of intent as of the Expiration Date of
this Agreement. If, within twelve (12) months after the Expiration Date of this
Agreement (the “Tail Period”), (i) Owner and the applicable tenant execute and
deliver a Lease Renewal or Modification with respect to any transaction
identified on the Pending List, (ii) such Lease Renewal or Modification is on
terms substantially similar to those contained in the last draft of the term
sheet or letter of intent that was delivered to the applicable tenant as of the
Expiration Date of this Agreement, and (iii) the Conditions are satisfied with
respect to such Lease Renewal or Modification, then Owner shall pay to Agent a
commission in accordance with the terms, covenants and conditions of this
Agreement. Notwithstanding the aforesaid, Agent shall not be entitled to any
compensation pursuant to this Agreement and the same is hereby waived if the
potential Lease Renewal or Modification is not actually executed and delivered
by Owner and the applicable tenant within the Tail Period; provided that Owner
shall use good faith reasonable efforts to negotiate and execute such Lease
Renewal or Modification within the Tail Period.
(b)    Owner’s obligation to pay any leasing commissions to Agent that have been
earned by Agent pursuant to the provisions hereof, but not yet payable,
including any Lease Renewal or Modification entered into prior to the expiration
or termination of this Agreement, shall survive the expiration or termination of
this Agreement.

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Section 3.9    Agent’s acceptance of compensation with respect to any Lease
Renewal or Modification shall be deemed a representation that Agent is entitled
to a commission in accordance with the terms hereof. Notwithstanding the
termination of this Agreement, Agent agrees at all times, with respect to any
Lease Renewal or Modification, to hold Owner, and its direct and indirect
partners, principals, members, officers, directors, employees and affiliates
harmless against any and all liability, loss, damage and expense (including
reasonable attorneys’ fees and disbursements) arising out of or otherwise
relating to claims for commissions on such Lease Renewal or Modification by any
other broker including but not limited to any Outside Broker, alleging to have
dealt with or through Agent arising out of alleged negotiations or conversations
had by Agent or Agent and Owner jointly (but not by Owner without the
participation of Agent), with the claimant broker. Agent’s liability under the
foregoing indemnity shall be limited to the money received by it from Owner on
the particular Lease Renewal or Modification transaction upon which a claim is
being made; provided, however, if Owner elects to pay an Outside Broker directly
pursuant to the terms of a separate Brokerage Agreement, then, subject to the
provisions of this Agreement, Owner shall be responsible for the commission to
which such Outside Broker is entitled pursuant to such Brokerage Agreement
between Owner and such Outside Broker. Owner agrees to use reasonable efforts to
have any commission agreement executed by an Outside Broker contain a provision
whereby such Outside Broker (i) represents, if correct, that such Outside Broker
and Agent were the sole brokers instrumental in consummating a Lease Renewal or
Modification with the tenant dealing with such Outside Broker; and (ii)
indemnifies and holds Owner and Agent harmless from and against any liability
arising from the incorrectness (actual or alleged) of such representation.
ARTICLE 4
Miscellaneous
Section 4.1    Agent will make available to Owner the advice and consultation of
its staff throughout the term of this Agreement for any reason reasonably
related to this Agreement and which would customarily be provided by a
first-class leasing agent in New York City, including, but not limited to, the
occupancy of the tenants within the Building. Nothing herein, however, shall be
construed to provide that Agent shall perform or provide professional legal
services. Within fifteen (15) days after the date hereof Agent shall submit to
Owner Agent’s initial marketing and leasing plan, on a floor by floor basis, for
the Building and Agent’s estimate of Owner’s future lease up costs. Agent shall
periodically, and no less than monthly, update such marketing and leasing plan
and shall include therein the Representative’s advice as to market trend rates
and comparative rents for leases being signed in the market in which the
Building is competing.
Section 4.2    The Representative shall conduct meetings with Owner to discuss
the activities to be conducted by Agent hereunder at such times as Owner may
reasonably request. Additionally, at any such meeting or upon Owner’s request,
Agent will provide to Owner a written report as to any telephone inquiries and
the status of any negotiations with respect to any space in the Building for the
prior week.
Section 4.3    This Agreement may be assigned by Owner to its grantee upon the
sale of the Building and upon the assignee’s unconditional assumption in writing
of this Agreement. Owner shall thereupon be relieved of any liability hereunder
except to the extent

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such liability accrued prior to the date of assignment.
Section 4.4    Any disagreement between Owner and Agent with respect to the
interpretation or construction of this Agreement or the obligations of the
parties hereunder shall be determined by arbitration. Such arbitration shall be
conducted, upon request of either Owner or Agent, before three (3) arbitrators
(unless Owner and Agent agree to one (1) arbitrator) designated by the American
Arbitration Association and in accordance with the rules of such Association.
The arbitrators designated and acting under this Agreement shall make an award
in strict conformity with such rules and shall have no power to depart from or
change any of the provisions hereof. The expense of arbitration proceedings
conducted hereunder shall be borne by the non-prevailing party. All arbitration
proceedings conducted hereunder shall be conducted in the City of New York.
Section 4.5    This Agreement contains the entire understanding of the parties.
Agent may not assign this Agreement nor may Agent assign its rights, duties or
obligations under this Agreement. This Agreement may not be changed or modified
orally but only by written instrument signed by the parties. This Agreement
shall be binding upon and inure to the benefit of the successors and, except as
may expressly otherwise be provided herein, the assigns of the respective
parties hereto.
Section 4.6    This Agreement shall be construed and interpreted in accordance
with the laws of the State of New York.
Section 4.7    All notices sent pursuant to the terms of this Agreement, in
order for same to be effective, must be sent by certified or registered mail,
return receipt requested, or by nationally recognized overnight carrier
providing for receipted delivery as follows:
Any required notices to Agent shall be directed to:
Savanna Commercial Services, LLC
c/o Savanna Real Estate Funds
10 East 53rd Street, 37th Floor
New York, New York 10022
Attention: Brian Reiver
E-mail:     breiver@savannafund.com
Telephone: 212-600-2517

with a copy to:
McDermott Will & Emery LLP
340 Madison Avenue
New York, New York 10173
Attention: William E. Stempel, Esq.
E-mail:     wstempel@mwe.com
Telephone: 212-547-5623

Any required notices to Owner shall be directed to:
[____________]

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c/o Savanna Real Estate Fund II
10 East 53rd Street, 37th Floor
New York, New York 10022
Attention: Nicholas C. Bienstock
E-mail:     nbienstock@savannafund.com
Telephone: 212-229-0101
with a copy to:
Savanna Real Estate Fund II
10 East 53rd Street, 37th Floor
New York, New York 10022
Attention: Christopher Schlank
E-mail:     cschlank@savannafund.com
Telephone: 212-229-0101
Section 4.8    The term “Agent” as used in this Agreement shall include any
corporate subsidiaries or affiliates of Agent who perform services on behalf of
Owner in, on or about the Building in connection with this Agreement.
Section 4.9    Owner shall indemnify, defend (or reimburse Agent’s reasonable
defense costs) and hold Agent, its affiliates assisting Agent in providing
services to Owner under this Agreement, their members, shareholders, directors,
officers and employees (collectively, the “Indemnified Parties”) harmless for
any and all loss, claims, demands, penalties, damages, liabilities, costs and
expenses, statutory or otherwise, including reasonable attorney’s fees and
expenses, arising from this Agreement, whether paid, incurred by, or asserted
against an Indemnified Party, hereinafter collectively called “claims”, for
injury to any persons or property in, about and in connection with the Building,
and from any cause whatsoever or which may arise after the termination of this
Agreement by reason of actions of persons or entities other than Agent, unless
caused by Agent’s willful misconduct in performance of its duties hereunder. The
foregoing indemnity shall not apply to the extent any loss, claims, demands,
penalties, damages, liabilities, costs and expenses result from the gross
negligence or willful acts of any of the Indemnified Parties. Agent agrees to
indemnify and hold Principal harmless from and against any and all “claims” (as
such term is defined in this Section 4.9), resulting from the acts, or failure
to act, of Agent, its agents or employees which acts or failure to act
constitute gross negligence or willful misconduct. It is expressly understood
and agreed that this Sections 4.9 shall survive the termination of this
Agreement.
Section 4.10    Agent shall not be entitled to any compensation from Owner of
any nature whatsoever except as may be expressly and specifically provided in
this Agreement. The term “compensation” as used herein, shall be deemed to
include any and all types of fees, commissions, reimbursements, etc.
Section 4.11    Notwithstanding anything to the contrary in this Agreement,
Agent shall look only to Owner’s estate in the Building and the land on which
the same is situated (or the rental income or sales and insurance proceeds
thereof) for the satisfaction of Agent’s remedies for the collection of any
judgment (or other judicial process) requiring the payment of money by Owner in
the event of any material breach of this Agreement by Owner,

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and no other property or assets of Owner or its partners or principals,
disclosed or undisclosed, shall be subject to levy, execution or other
enforcement procedure for the satisfaction of Agent’s remedies under or with
respect to this Agreement, the relationship of Owner and Agent hereunder or
under law or any other liability of Owner to Agent.
Section 4.12    Agent may, at its sole cost and expense, furnish, install and
maintain during the term hereof, a sign identifying it as the leasing agent for
the Building, subject to the prior written consent of Owner as to size, type,
material, manner of installation and location not to be unreasonably withheld.
Such sign shall be removed, at Agent’s sole cost and expense, upon the
expiration or termination of this Agreement and Agent, at its sole cost and
expense, shall repair any damage caused by such removal, wear and tear excepted.
Section 4.13    Notwithstanding anything in this Agreement to the contrary,
Agent is not authorized, and shall have no right, to execute any Lease Renewal
or Modification, amendments of lease, letters of intent or other instruments or
documents on behalf of Owner. Any term sheet prepared by Agent shall not be sent
or delivered to any prospective tenant or Outside Broker without the prior
written approval of Owner and such term sheet shall state that it is subject to
the execution and delivery of lease documents satisfactory to Owner in its sole
discretion. Additionally, Agent is not authorized, and shall have no right, to
make any representations or warranties with respect to the Building on behalf of
Owner.
[Signature page follows.]

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IN WITNESS WHEREOF, the parties have hereunto set their hands and seals as of
the day and year first above written.

OWNER:    [__________________]
a Delaware limited liability company

By:    ________________________
Name: Nicholas Bienstock
Title: Manager

AGENT:    Savanna Commercial Services, LLC,
a Delaware limited liability company
By:    _________________________
Name: Brian Reiver
Title: Director of Leasing

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SCHEDULE A
Based Upon Annual Fixed Rent

On the first year or any fraction thereof    5%
On the second year or any fraction thereof    4%
On the third year up to and including the fifth year    3½%
On the sixth year up to and including the tenth year    2½%
On the eleventh year up to and including the twentieth year    2%
On the twenty-first year and thereafter    1%

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SCHEDULE B

Payout Terms

100% of such commission upon the unconditional execution and delivery of the
Lease Renewal or Modification by Owner and the tenant and the obtaining of all
required consents and approvals necessary for the Lease Renewal or Modification
to become effective.

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SCHEDULE C

Exclusion List

N/A

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EXHIBIT G
FORM OF CONSTRUCTION MANAGEMENT AGREEMENT

PROJECT MANAGEMENT AGREEMENT

THIS PROJECT MANAGEMENT AGREEMENT (the “Agreement”) is made as of the ____ day
of __________________, 20______ by and between Savanna Project Management, LLC,
(“Savanna Project Management”) and ______________ (“Principal”).

W I T N E S S E T H:

WHEREAS, Principal wishes to retain Savanna Project Management to provide
project management services with respect to one or more construction projects on
the following terms and conditions; and

WHEREAS, Savanna Project Management wishes to provide such services on the
following terms and conditions.

NOW THEREFORE, in consideration of the payment hereinafter specified to be made
by Principal, and in consideration of the agreements and mutual covenants of the
parties herein contained, the parties hereto hereby agree as follows:

SECTION I.    SCOPE OF SERVICES

1.1    Basic Services. From time to time upon the request of Principal evidenced
by the issuance of a project authorization in the form attached hereto as
Exhibit A (a “Project Authorization”), Savanna Project Management shall perform
the project management services described in Exhibit B (“Services”) with respect
to one or more of Principal’s construction projects (a “Project”) on the terms
and conditions set forth herein. Upon execution by Principal and Savanna Project
Management, each Project Authorization shall be deemed incorporated into and
made a part of this Agreement. Savanna Project Management shall use good faith
efforts to perform the Services for each Project in accordance with the schedule
set forth in the Project Authorization for such Project. The execution by
Principal and Savanna Project Management of a Project Authorization shall
constitute Savanna Project Management’s authority to proceed to provide Services
with respect to the applicable Project, and Savanna Project Management shall not
be obligated or authorized to perform any Services with respect to any Project
until a Project Authorization for such Project has been signed by both Principal
and Savanna Project Management.

1.2    Additional Service Providers. Principal and Savanna Project Management
acknowledge and agree that Principal may require the services of architects,
space planners, engineers, general contractors, interior decorators and /or
other consultants and contractors in connection with one or more Projects
(“Additional Service Providers”). Savanna Project Management shall cooperate
with and coordinate such Additional Service Providers in order to achieve
Principal’s objectives for such Projects. At the request of Principal, Savanna
Project Management shall advise Principal with respect to the use of Additional
Service Providers; but it is expressly agreed and understood that Savanna
Project Management shall not be responsible for the engagement of any Additional
Service Providers, and all Additional Service Providers shall be engaged
directly by Principal and shall be compensated by Principal.

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SECTION 2.    SAVANNA PROJECT MANAGEMENT’S DUTIES AND STATUS

2.1    Service Standards. Savanna Project Management shall perform the Services
with care, skill, and diligence, in accordance with the standards applicable
generally to professionals performing similar services. Savanna Project
Management agrees to use good faith efforts to expedite the performance of all
services and obligations required under this Agreement and any other agreements
entered into by Principal which are managed or administered by Savanna Project
Management so that each Project is completed within the time schedule set forth
in the Project Authorization for such Project.

2.2    Independent Contractor. Except as set forth below, Savanna Project
Management shall assume all duties under this Agreement as an independent
contractor; and in no event shall this be considered an agreement of employment,
partnership or agency. Principal shall have no control or supervision over the
particular manner or method by which Savanna Project Management accomplishes the
performance of the Services, such matters being in the exclusive charge and
control of Savanna Project Management. Savanna Project Management shall comply
with all laws and all legal requirements of any governmental bodies having
jurisdiction over Savanna Project Management with respect to the Services to be
performed hereunder. Savanna Project Management shall be solely responsible for
all wages and benefits owed to its employees, and Principal shall have no
obligation with respect thereto.

2.3    Project Manager. Savanna Project Management shall assign a Project
Manager, and additional personnel if necessary, to perform the Services for each
Project. The Project Manager shall provide and coordinate all Services through
completion of the Project. The initial Project Manager for each Project shall be
set forth in the Project Authorization for such Project; provided, however,
Savanna Project Management may replace the Project Manager at any time if the
Project Manager is unable for any reason to perform such duties.

2.4    Force Majeure. Savanna Project Management’s obligations hereunder shall
be suspended to the extent and for so long as the performance of such
obligations are prevented or hindered in whole or in part by reason of strikes,
acts of God, federal, state, county, or municipal laws, rules, orders, or
regulations, or for any other cause which are beyond the reasonable control of
Savanna Project Management. When such a suspension occurs, Savanna Project
Management shall inform Principal; and Savanna Project Management shall resume
the performance of its obligations hereunder as soon as is reasonably
practicable.

SECTION 3.    COMPENSATION

3.1    Savanna Project Management’s Fee. Savanna Project Management shall be
paid a fee for performing Services (the “Project Fee”) for each Project as set
forth in the Project Authorization for such Project which, unless the parties
agree otherwise in the Project Authorization, shall be based upon Exhibit C
attached hereto. Unless otherwise set forth in the Project Authorization for a
Project, the Project Fee for each Project shall be earned and payable in monthly
installments according to the terms set forth in Exhibit C.

3.2    Expenses. In addition to the Project Fee, Principal shall reimburse
Savanna Project Management for any out-of-pocket expenses incurred by Savanna
Project Management in connection with each Project. Such expenses are described
in Exhibit C.

3.3    Terms of Payment. Savanna Project Management shall issue invoices to
Principal at the end of each month stating, in reasonable detail, the portion of
each Project Fee earned and payable for such month and the reimbursable expenses
incurred for such month. Such fees and expenses shall be due and payable by
Principal to Savanna Project Management within thirty (30) days of receipt by
Principal of Savanna Project Management's invoice. All other payments due from
one party to the other under this Agreement shall be due and payable thirty (30)
days following demand therefore. Delinquent payments hereunder shall earn
interest from the date due until paid at the lesser of: (i) the rate of one and
one-half percent (1 and 1/2%) per month or (ii) the maximum rate permitted by
law.

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3.4    Adjustments to Project Fee. If the scope of a Project increases beyond
that contemplated in Exhibit A or B or should the completion of a Project be
delayed through no fault of Savanna Project Management or should a change be
made in a Project which does not increase the scope or duration of the Project
but which requires an increase in Savanna Project Management’s personnel
committed to the Project, then the Project Fee for such Project will be
increased as is reasonably agreed between the parties.

3.5    Additional Services. Intentionally Omitted.

SECTION 4.
INDEMNIFICATION

4.1    Savanna Project Management’s Indemnity. To the maximum extent permitted
by law, Savanna Project Management shall indemnify, defend and hold Principal,
its subsidiaries and affiliates and the employees, partners, officers,
directors, members, shareholders and agents of each harmless from any and all
losses, liabilities, costs and expenses, including reasonable attorney’s fees
and court costs arising out of claims by third parties and sustained or incurred
by or asserted against Principal by reasons of or arising out of Savanna Project
Management’s gross negligence, intentional misconduct or fraud in connection
with this Agreement, any Project or the Services.

4.2    Principal’s Indemnity. To the maximum extent permitted by law, Principal
shall defend (with counsel reasonably acceptable to Savanna Project Management),
indemnify and hold harmless Savanna Project Management, its subsidiaries and
affiliates and the employees, partners, officers, directors, members,
shareholders and agents of each from and against all losses, liabilities, costs
and expenses (including, without limitation, reimbursement of actual attorney’s
fees, expert witness fees and court costs) incurred either as a defendant or
witness and arising out of claims by third parties in connection with this
Agreement, any Project or the Services, except to the extent such claims arise
out of Savanna Project Management’s gross negligence, intentional misconduct or
fraud.

SECTION 5.    INSURANCE

5.1    Savanna Project Management’s Insurance. Savanna Project Management shall
carry the following insurance, at its own expense:

(i)    Workers’ compensation insurance, to the extent of the statutory limits
required by applicable law, and employer’s liability insurance in the minimum
amount of $1,000,000.

(ii)    Commercial General Liability Insurance with limits of:
1.
General Aggregate $2,000,000; Each Occurrence $1,000,000

2.
Personal and Advertising $1,000,000

3.
Products and Completed Operations $1,000,000

4.
Medical Expense $5,000,000

5.
Employee Benefits $1,000,000

6.
Hired and Non-Owned Automobile $1,000,000

Coverages must include the following: blanket contractual liability, products
and completed operations and independent contractors. Principal shall be named
as an additional insured under such insurance. Limits should apply on a per
project basis.

(iii)    Umbrella/Excess Liability with limits of $10,000,000 per occurrence and
$10,000,000 aggregate. Principal shall be named as an additional insured under
such insurance. Limits should apply on a per project basis.

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(iv)    Professional liability (errors and omissions) insurance in the amount of
not less than $1,000,000. Such insurance coverage shall be on a claims made
basis and shall remain in force for the term of this Agreement and for two (2)
years following termination of this Agreement.

The foregoing policies are collectively referred to as “Savanna Project
Management’s Policies.” Savanna Project Management’s Policies must be maintained
with companies having an A.M. Best’s rating of A- VII or better. Savanna Project
Management shall provide Principal with certificates of insurance evidencing
Savanna Project Management’s Policies within ten (10) days of the execution of
this Agreement.

5.2    Principal’s Insurance. Principal shall carry the following insurance, at
its own expense:

(i)    All-risk property insurance, covering the full replacement cost of the
property at which the Projects are performed.

(ii)     For Project work, Principal will provide (or will cause its general
contractor to provide) at its expense builders risk insurance for construction
that covers special risk perils including earthquake, flood, fire, and theft of
materials stored at or within 1,000 feet of each Project site. Loss of Savanna
Project Management’s tools and equipment are not covered by such insurance, and
Principal shall have no liability for their loss.

(iii)    Commercial General Liability Insurance with limits of:
1.
General Aggregate $2,000,000; Each Occurrence $1,000,000

2.
Personal and Advertising $1,000,000

3.
Products and Completed Operations $1,000,000

4.
Medical Expense $5,000,000

5.
Employee Benefits $1,000,000

6.
Hired and Non-Owned Automobile $1,000,000

Coverages must include the following: blanket contractual liability, products
and completed operations and independent contractors. Limits should apply on a
per location basis.

(iv)    Umbrella/Excess Liability with limits of $10,000,000 per occurrence and
$10,000,000 aggregate. Limits should apply on a per location basis.

The foregoing policies are collectively referred to herein as the “Principal’s
Policies.” Savanna Project Management shall be named as an additional insured
under Principal’s Commercial General Liability Insurance in its capacity as
project manager of each Project. Principal’s Commercial General Liability policy
shall be primary and any commercial general liability insurance policy carried
by Savanna Project Management shall be non-contributory thereto with respect to
any claims arising out of the performance or non-performance of the Services or
the condition of the real property which is the site of each Project. Principal
shall furnish to Savanna Project Management a certificate of insurance
evidencing such coverage within ten (10) days of the execution of this
Agreement. Companies with which the insurance is placed shall have received an
A.M. Best’s rating of A- VII or better.

5.3     Mutual Waiver. All property damage insurance policies required of each
of the parties hereunder shall contain appropriate clauses pursuant to which the
respective insurance carriers shall waive all rights of subrogation with respect
to losses payable under such policies; and each party waives any claims against
the other party for any damage to its property.

SECTION 6. LIMITATION OF SAVANNA PROJECT MANAGEMENT'S SERVICES

6.1    Technical Matters. Savanna Project Management shall assist Principal in
the evaluation of regulatory requirements related to each Project including
zoning ordinances, public facilities requirements and other

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requirements of the jurisdiction in which each Project is located (“Technical
Matters”). In addition, Savanna Project Management shall advise Principal as to
experts to use for Technical Matters and shall coordinate the work of such
experts with that of the other consultants, contractors, suppliers and service
providers working on each Project in accordance with Section 1.2 above.
Notwithstanding the foregoing, Principal acknowledges that Savanna Project
Management is not an expert in and is not responsible for Technical Matters, and
Principal shall rely solely on the judgments of the experts Principal hires with
respect to such Technical Matters.

6.2    Time. Savanna Project Management acknowledges and agrees that time is of
the essence with respect to the performance of the Services, including, with
respect to each Project, the performance of the Services within the time
periods set forth in the Project Schedule for such Project.  Payment may be
withheld for failure to timely carry out the Services in accordance with this
Agreement. Notwithstanding the foregoing, Savanna Project Management shall have
no liability for delays caused by Principal, or by other circumstances beyond
the control of Savanna Project Management.

SECTION 7.
TERMINATION

7.1    Right to Terminate. Either party may terminate this Agreement upon prior
notice to the other party; provided, however, such termination shall not affect
any outstanding Project Authorizations, and this Agreement shall remain in full
force and effect until completion of the Projects covered by such Project
Authorizations. In addition, Principal may terminate any Project Authorizations
upon thirty (30) days prior notice to Savanna Project Management; and either
party may terminate a Project Authorization immediately in the event of a
material default hereunder by the other party with respect to such Project
Authorization if such default has not been cured within ten (10) days after
written notice to the other party.

7.2    Payment Upon Termination. If a Project Authorization is terminated,
Savanna Project Management shall receive the portion of the Project Fee earned
to the date of termination in accordance with the payment schedule as set forth
in Exhibit C. Savanna Project Management shall also receive payment for
reimbursable expenses and other reasonable costs incurred due to termination.
Savanna Project Management shall receive payment of all such fees and expenses
within ten (10) days following the termination of the Project Authorization.

SECTION 8.     NOTICES

8.1    Address for Notices. The addresses of Principal and Savanna Project
Management for service of any notices and reports hereunder shall be
respectively as follows:

Principal:
______________________________
C/O Savanna
10 East 53rd Street
New York, NY 10022
Attention: Nicholas Bienstock
Savanna Project Management:

Savanna Project Management, LLC
10 East 53rd Street, 37th Floor
New York, NY 10022
Attention: Christopher Schlank

8.2    Delivery of Notices. Any notice required or permitted to be given
hereunder shall be hand delivered, sent by nationally recognized delivery
service, or sent by registered mail, return receipt requested, to Principal or
Savanna Project Management at its respective address shown above. Any such
notice shall be deemed to have been received by the party to whom it is
addressed on the date and at the time it is so delivered.

SECTON 9. MISCELLANEOUS

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9.1    Confidentiality. Except as may be required by any governmental entity
having jurisdiction over Savanna Project Management and except as may be
necessary to perform its services hereunder, Savanna Project Management shall
not disclose to any third party any confidential information that Principal
makes available to Savanna Project Management. Savanna Project Management agrees
to limit access to such information to those employees reasonably requiring such
access for purposes of providing the Services and shall request that its
employees maintain the confidentiality of such information in accordance with
the terms hereof.

9.2    Complete Agreement; Amendments. This Agreement and all Exhibits attached
hereto, which are incorporated herein by this reference, contain the entire
agreement between Principal and Savanna Project Management and supersedes and
replaces all previous agreements, whether written or oral, with respect to the
subject matter of this Agreement. This Agreement may not be changed, modified,
amended, or discharged, except by an agreement in writing.

9.3    Advertising. Principal agrees that Savanna Project Management may
identify in its corporate promotional literature and advertising that it is the
project manager for each Project and that Savanna Project Management may use
photographs and renderings of each completed Project in such advertising and
promotional records.
 
9.4    Intentionally Omitted

9.5    Applicable Law. This Agreement shall be construed under and interpreted
in accordance with the internal laws of the State of New York.

9.6    Survival. The provisions of Sections 3, 4, 5, 6, 7, 8 and 9 of this
Agreement shall survive the expiration or termination of this Agreement.

9.7    Successors and Assigns. Neither party may assign its rights or
obligations hereunder except to an affiliate or to any entity which acquires all
or substantially all of the assets and business of either party. Except as set
forth in the immediately preceding sentence, this Agreement shall be binding
upon and inure to the benefit of the parties hereto and their successors and
assigns.

9.8    Limitation on Liability. Notwithstanding anything else contained herein
to the contrary, each party shall look solely to the assets of the other party
for satisfaction of any liabilities or obligations relating to this engagement,
and no officer, director, employee, partner, affiliate, shareholder or agent of
either party shall be personally responsible for any such liabilities or
obligations. In addition, each party waives any claims for punitive,
consequential, speculative or exemplary damages, including, without limitation,
lost revenue or profit, even if a party has knowledge of the possibility of such
damages; and, except for Savanna Project Management’s liability to third parties
for bodily injury, death or property damage, in no event shall Savanna Project
Management’s liability to Principal with respect to each Project exceed an
amount equal to the lesser of annual fees paid or One Million Dollars
($1,000,000).

9.9    Litigation Expenses. If there is any litigation between the parties with
respect to this Agreement or the subject matter hereof, the prevailing party in
such litigation shall be entitled to collect all of its costs and expenses in
such litigation, including reasonable attorneys’ fees and court costs, from the
other party.

9.10    Rules of Interpretation. The headings set forth herein are for the
convenience of the parties only and shall not be used to interpret the meaning
of this Agreement. Each party agrees that it has been represented by counsel and
has participated in the negotiation of this Agreement, and this Agreement shall
not be construed against either party on the theory that such party drafted this
Agreement. In the event any provision of this Agreement shall be invalid,
illegal or unenforceable, the validity, legality or enforceability of the
remaining provisions shall not in any way be affected thereby.

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

9.11    Counterparts. This Agreement may be executed and delivered in several
counterparts, each of which shall be deemed an original, but all of which shall
constitute one and the same document. The delivery of an executed counterpart of
this Agreement by facsimile or as a PDF or similar attachment to an e-mail shall
constitute effective delivery of such counterpart for all purposes with the same
force and effect as the delivery of an original, executed counterpart.

IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of
the day and year first above written.

§    PRINCIPAL
_________________
SAVANNA PROJECT MANAGEMENT
Savanna Project Management, LLC

By:
 
 

By:
 
 

Name:
 
 

Name:
 
 

Its:
 
 

Its:
 
 

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

EXHIBIT G
FORM OF CONSTRUCTION MANAGEMENT AGREEMENT
PROJECT MANAGEMENT AGREEMENT
THIS PROJECT MANAGEMENT AGREEMENT (the “Agreement”) is made as of the ____ day
of __________________, 20______ by and between Savanna Project Management, LLC,
(“Savanna Project Management”) and ______________ (“Principal”).
W I T N E S S E T H:
WHEREAS, Principal wishes to retain Savanna Project Management to provide
project management services with respect to one or more construction projects on
the following terms and conditions; and
WHEREAS, Savanna Project Management wishes to provide such services on the
following terms and conditions.
NOW THEREFORE, in consideration of the payment hereinafter specified to be made
by Principal, and in consideration of the agreements and mutual covenants of the
parties herein contained, the parties hereto hereby agree as follows:
SECTION I.    SCOPE OF SERVICES
1.1    Basic Services. From time to time upon the request of Principal evidenced
by the issuance of a project authorization in the form attached hereto as
Exhibit A (a “Project Authorization”), Savanna Project Management shall perform
the project management services described in Exhibit B (“Services”) with respect
to one or more of Principal’s construction projects (a “Project”) on the terms
and conditions set forth herein. Upon execution by Principal and Savanna Project
Management, each Project Authorization shall be deemed incorporated into and
made a part of this Agreement. Savanna Project Management shall use good faith
efforts to perform the Services for each Project in accordance with the schedule
set forth in the Project Authorization for such Project. The execution by
Principal and Savanna Project Management of a Project Authorization shall
constitute Savanna Project Management’s authority to proceed to provide Services
with respect to the applicable Project, and Savanna Project Management shall not
be obligated or authorized to perform any Services with respect to any Project
until a Project Authorization for such Project has been signed by both Principal
and Savanna Project Management.
1.2    Additional Service Providers. Principal and Savanna Project Management
acknowledge and agree that Principal may require the services of architects,
space planners, engineers, general contractors, interior decorators and /or
other consultants and contractors in connection with one or more Projects
(“Additional Service Providers”). Savanna Project Management shall cooperate
with and coordinate such Additional Service Providers in order to achieve
Principal’s objectives for such Projects. At the request of Principal, Savanna
Project Management shall advise Principal with respect to the use of Additional
Service Providers; but it is expressly agreed and understood that Savanna
Project Management shall not be responsible for the engagement of any Additional
Service Providers, and all Additional Service Providers shall be engaged
directly by Principal and shall be compensated by Principal.

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

SECTION 2.    SAVANNA PROJECT MANAGEMENT’S DUTIES AND STATUS
2.1    Service Standards. Savanna Project Management shall perform the Services
with care, skill, and diligence, in accordance with the standards applicable
generally to professionals performing similar services. Savanna Project
Management agrees to use good faith efforts to expedite the performance of all
services and obligations required under this Agreement and any other agreements
entered into by Principal which are managed or administered by Savanna Project
Management so that each Project is completed within the time schedule set forth
in the Project Authorization for such Project.
2.2    Independent Contractor. Except as set forth below, Savanna Project
Management shall assume all duties under this Agreement as an independent
contractor; and in no event shall this be considered an agreement of employment,
partnership or agency. Principal shall have no control or supervision over the
particular manner or method by which Savanna Project Management accomplishes the
performance of the Services, such matters being in the exclusive charge and
control of Savanna Project Management. Savanna Project Management shall comply
with all laws and all legal requirements of any governmental bodies having
jurisdiction over Savanna Project Management with respect to the Services to be
performed hereunder. Savanna Project Management shall be solely responsible for
all wages and benefits owed to its employees, and Principal shall have no
obligation with respect thereto.
2.3    Project Manager. Savanna Project Management shall assign a Project
Manager, and additional personnel if necessary, to perform the Services for each
Project. The Project Manager shall provide and coordinate all Services through
completion of the Project. The initial Project Manager for each Project shall be
set forth in the Project Authorization for such Project; provided, however,
Savanna Project Management may replace the Project Manager at any time if the
Project Manager is unable for any reason to perform such duties.
2.4    Force Majeure. Savanna Project Management’s obligations hereunder shall
be suspended to the extent and for so long as the performance of such
obligations are prevented or hindered in whole or in part by reason of strikes,
acts of God, federal, state, county, or municipal laws, rules, orders, or
regulations, or for any other cause which are beyond the reasonable control of
Savanna Project Management. When such a suspension occurs, Savanna Project
Management shall inform Principal; and Savanna Project Management shall resume
the performance of its obligations hereunder as soon as is reasonably
practicable.
SECTION 3.    COMPENSATION
3.1    Savanna Project Management’s Fee. Savanna Project Management shall be
paid a fee for performing Services (the “Project Fee”) for each Project as set
forth in the Project Authorization for such Project which, unless the parties
agree otherwise in the Project Authorization, shall be based upon Exhibit C
attached hereto. Unless otherwise set forth in the Project Authorization for a
Project, the Project Fee for each Project shall be earned and payable in monthly
installments according to the terms set forth in Exhibit C.
3.2    Expenses. In addition to the Project Fee, Principal shall reimburse
Savanna Project Management for any out-of-pocket expenses incurred by Savanna
Project Management in connection with each Project. Such expenses are described
in Exhibit C.
3.3    Terms of Payment. Savanna Project Management shall issue invoices to
Principal at the end of each month stating, in reasonable detail, the portion of
each Project Fee earned and payable for such month and the reimbursable expenses
incurred for such month. Such fees and expenses shall be due and payable by
Principal to Savanna Project Management within thirty (30) days of receipt by
Principal of Savanna Project Management's invoice. All other payments due from
one party to the other under this Agreement shall be due and payable thirty (30)
days following demand therefore. Delinquent payments hereunder shall earn
interest from the date due until paid at the lesser of: (i) the rate of one and
one-half percent (1 and 1/2%) per month or
(ii) the maximum rate permitted by law.

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

3.4    Adjustments to Project Fee. If the scope of a Project increases beyond
that contemplated in Exhibit A or B or should the completion of a Project be
delayed through no fault of Savanna Project Management or should a change be
made in a Project which does not increase the scope or duration of the Project
but which requires an increase in Savanna Project Management’s personnel
committed to the Project, then the Project Fee for such Project will be
increased as is reasonably agreed between the parties.
3.5    Additional Services. Intentionally Omitted.
SECTION 4.    INDEMNIFICATION
4.1    Savanna Project Management’s Indemnity. To the maximum extent permitted
by law, Savanna Project Management shall indemnify, defend and hold Principal,
its subsidiaries and affiliates and the employees, partners, officers,
directors, members, shareholders and agents of each harmless from any and all
losses, liabilities, costs and expenses, including reasonable attorney’s fees
and court costs arising out of claims by third parties and sustained or incurred
by or asserted against Principal by reasons of or arising out of Savanna Project
Management’s gross negligence, intentional misconduct or fraud in connection
with this Agreement, any Project or the Services.
4.2     Principal’s Indemnity. To the maximum extent permitted by law, Principal
shall defend (with counsel reasonably acceptable to Savanna Project Management),
indemnify and hold harmless Savanna Project Management, its subsidiaries and
affiliates and the employees, partners, officers, directors, members,
shareholders and agents of each from and against all losses, liabilities, costs
and expenses (including, without limitation, reimbursement of actual attorney’s
fees, expert witness fees and court costs) incurred either as a defendant or
witness and arising out of claims by third parties in connection with this
Agreement, any Project or the Services, except to the extent such claims arise
out of Savanna Project Management’s gross negligence, intentional misconduct or
fraud.
SECTION 5.    INSURANCE
5.1    Savanna Project Management’s Insurance. Savanna Project Management shall
carry the following insurance, at its own expense:
(i)     Workers’ compensation insurance, to the extent of the statutory limits
required by applicable law, and employer’s liability insurance in the minimum
amount of $1,000,000.
(ii)     Commercial General Liability Insurance with limits of:
1. General Aggregate $2,000,000; Each Occurrence $1,000,000
2. Personal and Advertising $1,000,000
3. Products and Completed Operations $1,000,000
4. Medical Expense $5,000,000
5. Employee Benefits $1,000,000
6. Hired and Non-Owned Automobile $1,000,000
Coverages must include the following: blanket contractual liability, products
and completed operations and independent contractors. Principal shall be named
as an additional insured under such insurance. Limits should apply on a per
project basis.
(iii)    Umbrella/Excess Liability with limits of $10,000,000 per occurrence and
$10,000,000 aggregate. Principal shall be named as an additional insured under
such insurance. Limits should apply on a per project basis.

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

(iv)    Professional liability (errors and omissions) insurance in the amount of
not less than $1,000,000. Such insurance coverage shall be on a claims made
basis and shall remain in force for the term of this Agreement and for two (2)
years following termination of this Agreement. The foregoing policies are
collectively referred to as “Savanna Project Management’s Policies.” Savanna
Project Management’s Policies must be maintained with companies having an A.M.
Best’s rating of A- VII or better. Savanna Project Management shall provide
Principal with certificates of insurance evidencing Savanna Project Management’s
Policies within ten (10) days of the execution of this Agreement.
5.2    Principal’s Insurance. Principal shall carry the following insurance, at
its own expense:
(i)    All-risk property insurance, covering the full replacement cost of the
property at which the Projects are performed.
(ii)    For Project work, Principal will provide (or will cause its general
contractor to provide) at its expense builders risk insurance for construction
that covers special risk perils including earthquake, flood, fire, and theft of
materials stored at or within 1,000 feet of each Project site. Loss of Savanna
Project Management’s tools and equipment are not covered by such insurance, and
Principal shall have no liability for their loss.
(iii)    Commercial General Liability Insurance with limits of:
1. General Aggregate $2,000,000; Each Occurrence $1,000,000
2. Personal and Advertising $1,000,000
3. Products and Completed Operations $1,000,000
4. Medical Expense $5,000,000
5. Employee Benefits $1,000,000
6. Hired and Non-Owned Automobile $1,000,000
Coverages must include the following: blanket contractual liability, products
and completed operations and independent contractors. Limits should apply on a
per location basis.
(iv)    Umbrella/Excess Liability with limits of $10,000,000 per occurrence and
$10,000,000 aggregate. Limits should apply on a per location basis.
The foregoing policies are collectively referred to herein as the “Principal’s
Policies.” Savanna Project Management shall be named as an additional insured
under Principal’s Commercial General Liability Insurance in its capacity as
project manager of each Project. Principal’s Commercial General Liability policy
shall be primary and any commercial general liability insurance policy carried
by Savanna Project Management shall be non-contributory thereto with respect to
any claims arising out of the performance or non-performance of the Services or
the condition of the real property which is the site of each Project. Principal
shall furnish to Savanna Project Management a certificate of insurance
evidencing such coverage within ten (10) days of the execution of this
Agreement. Companies with which the insurance is placed shall have received an
A.M. Best’s rating of AVII or better.
5.3    Mutual Waiver. All property damage insurance policies required of each of
the parties hereunder shall contain appropriate clauses pursuant to which the
respective insurance carriers shall waive all rights of subrogation with respect
to losses payable under such policies; and each party waives any claims against
the other party for any damage to its property.
SECTION 6. LIMITATION OF SAVANNA PROJECT MANAGEMENT'S SERVICES
6.1    Technical Matters. Savanna Project Management shall assist Principal in
the evaluation of regulatory requirements related to each Project including
zoning ordinances, public facilities requirements and other

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

requirements of the jurisdiction in which each Project is located (“Technical
Matters”). In addition, Savanna Project Management shall advise Principal as to
experts to use for Technical Matters and shall coordinate the work of such
experts with that of the other consultants, contractors, suppliers and service
providers working on each Project in accordance with Section 1.2 above.
Notwithstanding the foregoing, Principal acknowledges that Savanna Project
Management is not an expert in and is not responsible for Technical Matters, and
Principal shall rely solely on the judgments of the experts Principal hires with
respect to such Technical Matters.
6.2    Time. Savanna Project Management acknowledges and agrees that time is of
the essence with respect to the performance of the Services, including, with
respect to each Project, the performance of the Services within the time periods
set forth in the Project Schedule for such Project. Payment may be withheld for
failure to timely carry out the Services in accordance with this Agreement.
Notwithstanding the foregoing, Savanna Project Management shall have no
liability for delays caused by Principal, or by other circumstances beyond the
control of Savanna Project Management.
SECTION 7. TERMINATION
7.1    Right to Terminate. Either party may terminate this Agreement upon prior
notice to the other party; provided, however, such termination shall not affect
any outstanding Project Authorizations, and this Agreement shall remain in full
force and effect until completion of the Projects covered by such Project
Authorizations. In addition, Principal may terminate any Project Authorizations
upon thirty (30) days prior notice to Savanna Project Management; and either
party may terminate a Project Authorization immediately in the event of a
material default hereunder by the other party with respect to such Project
Authorization if such default has not been cured within ten (10) days after
written notice to the other party.
7.2    Payment Upon Termination. If a Project Authorization is terminated,
Savanna Project Management shall receive the portion of the Project Fee earned
to the date of termination in accordance with the payment schedule as set forth
in Exhibit C. Savanna Project Management shall also receive payment for
reimbursable expenses and other reasonable costs incurred due to termination.
Savanna Project Management shall receive payment of all such fees and expenses
within ten (10) days following the termination of the Project Authorization.
SECTION 8. NOTICES
8.1    Address for Notices. The addresses of Principal and Savanna Project
Management for service of any notices and reports hereunder shall be
respectively as follows:
Principal:     Savanna Project Management:
______________________________
C/O Savanna     Savanna Project Management, LLC
10 East 53rd Street     10 East 53rd Street, 37th Floor
New York, NY 10022     New York, NY 10022
Attention: Nicholas Bienstock     Attention: Christopher Schlank
8.2    Delivery of Notices. Any notice required or permitted to be given
hereunder shall be hand delivered, sent by nationally recognized delivery
service, or sent by registered mail, return receipt requested, to Principal or
Savanna Project Management at its respective address shown above. Any such
notice shall be deemed to have been received by the party to whom it is
addressed on the date and at the time it is so delivered.
SECTON 9. MISCELLANEOUS

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

9.1     Confidentiality. Except as may be required by any governmental entity
having jurisdiction over Savanna Project Management and except as may be
necessary to perform its services hereunder, Savanna Project Management shall
not disclose to any third party any confidential information that Principal
makes available to Savanna Project Management. Savanna Project Management agrees
to limit access to such information to those employees reasonably requiring such
access for purposes of providing the Services and shall request that its
employees maintain the confidentiality of such information in accordance with
the terms hereof.
9.2     Complete Agreement; Amendments. This Agreement and all Exhibits attached
hereto, which are incorporated herein by this reference, contain the entire
agreement between Principal and Savanna Project Management and supersedes and
replaces all previous agreements, whether written or oral, with respect to the
subject matter of this Agreement. This Agreement may not be changed, modified,
amended, or discharged, except by an agreement in writing.
9.3     Advertising. Principal agrees that Savanna Project Management may
identify in its corporate promotional literature and advertising that it is the
project manager for each Project and that Savanna Project Management may use
photographs and renderings of each completed Project in such advertising and
promotional records.
9.4     Intentionally Omitted
9.5     Applicable Law. This Agreement shall be construed under and interpreted
in accordance with the internal laws of the State of New York.
9.6     Survival. The provisions of Sections 3, 4, 5, 6, 7, 8 and 9 of this
Agreement shall survive the expiration or termination of this Agreement.
9.7     Successors and Assigns. Neither party may assign its rights or
obligations hereunder except to an affiliate or to any entity which acquires all
or substantially all of the assets and business of either party. Except as set
forth in the immediately preceding sentence, this Agreement shall be binding
upon and inure to the benefit of the parties hereto and their successors and
assigns.
9.8     Limitation on Liability. Notwithstanding anything else contained herein
to the contrary, each party shall look solely to the assets of the other party
for satisfaction of any liabilities or obligations relating to this engagement,
and no officer, director, employee, partner, affiliate, shareholder or agent of
either party shall be personally responsible for any such liabilities or
obligations. In addition, each party waives any claims for punitive,
consequential, speculative or exemplary damages, including, without limitation,
lost revenue or profit, even if a party has knowledge of the possibility of such
damages; and, except for Savanna Project Management’s liability to third parties
for bodily injury, death or property damage, in no event shall Savanna Project
Management’s liability to Principal with respect to each Project exceed an
amount equal to the lesser of annual fees paid or One Million Dollars
($1,000,000).
9.9     Litigation Expenses. If there is any litigation between the parties with
respect to this Agreement or the subject matter hereof, the prevailing party in
such litigation shall be entitled to collect all of its costs and expenses in
such litigation, including reasonable attorneys’ fees and court costs, from the
other party.
9.10     Rules of Interpretation. The headings set forth herein are for the
convenience of the parties only and shall not be used to interpret the meaning
of this Agreement. Each party agrees that it has been represented by counsel and
has participated in the negotiation of this Agreement, and this Agreement shall
not be construed against either party on the theory that such party drafted this
Agreement. In the event any provision of this Agreement shall be invalid,
illegal or unenforceable, the validity, legality or enforceability of the
remaining provisions shall not in any way be affected thereby.

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

9.11     Counterparts. This Agreement may be executed and delivered in several
counterparts, each of which shall be deemed an original, but all of which shall
constitute one and the same document. The delivery of an executed counterpart of
this Agreement by facsimile or as a PDF or similar attachment to an e-mail shall
constitute effective delivery of such counterpart for all purposes with the same
force and effect as the delivery of an original, executed counterpart.

IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of
the day and year first above written

▪
PRINCIPAL     SAVANNA PROJECT MANAGEMENT

_________________     Savanna Project Management, LLC

By: _______________________________    By: _______________________________
Name: ____________________________    Name: ____________________________
Its: ______________________________    Its: ______________________________

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

Exhibit A

Project Description

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

1.0
PROJECT DESCRIPTION:
Savanna Project Management will manage the design and construction of multiple
projects located at ______________, including: ______________ and other building
improvement projects as specified by Principal.
 
 
 
 
 
 
2.0
LOCATION:
 
 
 
 
 
 
 
 
 
3.0
ESTIMATED RSF:
 
 
 
 
 
 
 
4.0
ESTIMATED PROJECT SCHEDULE:
 
 
§    The parties expect the Project will commence on ______________ and be
completed by ______________ (the “Estimated Project Schedule”).
 
 
 
 
 
 
5.0
PROJECT MANAGER:
 
 
§    The Project Manager for the Project shall be Eric DeSimone, or such other
individual as designated by Savanna Project Management from time to time.

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

Exhibit B

Scopes of Services - Project Management

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

Scope of Services
Project Planning
▪
Define project goals in term of cost, schedule and physical requirements

▪
Determine necessary design team members, i.e. licensed architect to work with
design group, mep engineer, and other consulting engineers, etc.

▪
Oversee test fit process

▪
Determine project phasing and establish programming requirements

▪
Prepare project master schedule

▪
Prepare preliminary project budget

▪
Manage architectural and engineering program process

▪
Review architectural and engineering program and obtain user approval

▪
Review project financial assumptions as they relate to the project

▪
Present findings – set project performance criteria

Design Management
▪
Represent Principal during design process

▪
Kick off design process – set goals and objectives

▪
Manage schematic design - architectural and engineering

▪
Manage team in preparation of project budget based upon schematic design

▪
Manage value engineering of alternate methods and systems

▪
Review schematic design and obtain approval

▪
Manage design development

▪
Manage process for local, state and federal governing agencies and assist the
architect, engineer, construction manager in securing all necessary permits and
required approvals

▪
Develop project time schedules for the Design Phase and coordinate the
activities of the Client, architect, engineer, interior designer and other
consultants

▪
Develop a preliminary project time schedule for the Construction Phase showing
the major construction activities, occupancy schedules and final completion
dates

▪
Recommend to Principal for approval, the purchase of long lead items to meet
project schedule requirements

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

Exhibit B

Scopes of Services - Project Management

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

▪
Coordinate information between Principal and team members

▪
Manage budget based upon design development

▪
Review design development with and obtain Principal approval

▪
Update project schedule

▪
Manage construction document production

▪
Manage input to constructability, methods and materials

▪
Review of all documents prior to bid.

Pre - Construction and Construction Services Phase
▪
Define project goals in terms of cost, schedule and physical requirements

▪
Determine any additional design team members, which may be required

▪
Review existing design documents and make recommendations as required

▪
Represent Principal during the finalization of the construction documents

▪
Manage process for local, governing agencies and assist the architect, engineer,
and construction manager in securing all necessary permits and required
approvals

▪
Represent Principal during construction phase

▪
Identify municipal permitting process

▪
Manage building permit application (if required by project timing)

▪
Pre-qualify appropriate general contractor/construction managers

▪
Solicit input from Principal and agree upon final bid list

▪
Prepare detailed construction RFP coordinating requirements of the building and
lease

▪
Solicit proposals from pre-qualified general contractors/construction managers

▪
Assist in the selection of necessary testing agencies and negotiate their
contracts

▪
Advise Principal and general contractor/construction manager regarding any
insurance, which should be purchased and maintained during construction of the
project

▪
Receive, review and qualify proposals - prepare detailed bid analysis

▪
Interview general contractor/construction manager candidates

▪
Prepare final recommendation and terms of award

▪
Negotiate general contractor/construction manager contract

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

Exhibit B

Scopes of Services - Project Management

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

▪
Conduct construction kick off meeting

▪
Chair regular project meetings including architect, engineer, building
management contractors, etc.

▪
Coordinate vendors and contractors with Principal requirements

▪
Issue monthly project progress reports

▪
Review and process general contractor/construction manager and vendor payments

▪
Monitor and report on construction costs, issue monthly project anticipated cost
reports

▪
Review request for change in cost and/or time. Negotiate on behalf of Principal
as required.

▪
Monitor and report schedule status

▪
Consult as to avoid construction conflicts

▪
Mediate construction conflicts that do occur

▪
Overseeing the handling and removal of hazardous materials

Project Close-Out
▪
Establish vendor procedure for punchlist, systems preoccupancy testing and
client training on new equipment and systems.

▪
Monitor vendor submission to client of as-built drawings, warranties, operating
and maintenance manuals, system testing documentation, attic stock, completed
punchlist and governmental and regulatory sign-offs.

▪
Review all final invoices for conformance to contract terms, including final
lien waivers and releases.

▪
Produce final cost report that summarizes, per budget line item, all base
contract costs and approved change orders in comparison to approved budget.

Deliverables
Budgets
Savanna Project Management will work with the project team to prepare a
preliminary budget for review. This budget will include all hard and soft costs,
potential exposures and appropriate contingencies. Savanna Project Management
would expect Principal to approve budgets in a formal session during the course
of the project.
•
Master Project Budgets for all projects

Agenda and Minutes
Savanna Project Management will prepare detailed agendas and accurate, timely
minutes for our project meetings and work sessions.
•
Project Meeting Agenda and Minutes

Schedules

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

Exhibit B

Scopes of Services - Project Management

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

Savanna Project Management will develop a master project completion schedule.
Schedules will be monitored regularly in conjunction with the project team.
•
Master Project Schedule with critical tasks and milestones.

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

Compensation
The resource that we provide to you is the collective experience, proven
processes and efforts of our project managers. Our fees for services are based
upon on a sliding scale percentage on a cumulative project basis as set forth
below and billed on a monthly basis

Sliding Fee Scale
Max Cost
 
$
1,249,999

$
2,499,999

$
3,749,999

$
4,999,999

n/a

Min Cost
 
-

1,250,000

2,500,000

3,750,000

5,000,000

Fee %
 
4.25
%
4.00
%
3.75
%
3.50
%
3.25
%

Additional Fees
Based on the described scope of services and team and approved by Principal
Savanna Project Management shall be compensated by Principal in accordance with
the following Hourly Rate Schedule for any additional services that are not part
of any particular billable project.

Staff/level of support
Hourly rate
Vice President
$175.00
Project Manager
$150.00
Assistant Project Manager
$125.00
Project Coordinator/Admin
$75.00

* Modification of team and or other ‘consultant’ arrangement may require hourly
fee to be amended.

Expenses
Expenses for reproduction of documents, messenger and courier services, travel
and accommodations will
be reimbursed at cost without mark-ups.

Exclusions
The following expense items are excluded from this proposal:
•Savanna Project Management serving as an Expert Witness
•Lease negotiations

§    

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EXHIBIT H
KBS TRANSFER LANGUAGE

Notwithstanding anything stated to the contrary herein, any transfers (or the
pledge or encumbrance) of equity interests or other interests in KBS SOR
Properties, LLC, or in any of the direct or indirect owners of KBS SOR
Properties, LLC (including, without limitation, KBS Strategic Opportunity
Limited Partnership, KBS Strategic Opportunity Holdings, LLC, or KBS Strategic
Opportunity REIT, Inc.) shall not be prohibited (and shall be expressly
permitted), provided that KBS Strategic Opportunity REIT, Inc., continues to
own, either directly or indirectly, not less than 51% of the ownership interests
in Borrower.
Notwithstanding the foregoing or anything stated to the contrary herein, the
following transactions will not be prohibited and shall be expressly permitted:
(a) KBS SOR Properties, LLC, KBS Strategic Opportunity Limited Partnership, KBS
Strategic Opportunity REIT, Inc., and KBS Strategic Opportunity Holdings, LLC,
shall each be permitted to execute guaranties and/or indemnity agreements for
their respective subsidiaries; and
(b) KBS Strategic Opportunity Limited Partnership, KBS Strategic Opportunity
REIT, Inc., and any of the other parties owning interests in KBS Strategic
Opportunity Limited Partnership, direct or indirect, shall be permitted to
obtain loans from, or incur indebtedness to, any third-party lender (each a
“Secondary Loan”) and pledge their respective interests (direct or indirect) in
KBS Strategic Opportunity Limited Partnership and KBS SOR Properties, LLC, as
security for any such Secondary Loan so long as (A) neither Borrower nor
Borrower’s sole member’s membership interest are pledged to secure such
Secondary Loan, and (B) any default under a Secondary Loan resulting in a
foreclosure of the pledged interests and a transfer of such interest to the
lender of the Secondary Loan shall not be deemed an event of default under the
Loan documents.

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LIMITED LIABILITY COMPANY AGREEMENT
OF KBS SOR SREF III 110 WILLIAM, LLC
THIS AGREEMENT HAS NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION UNDER THE SECURITIES ACT OF 1933, 15 U.S.C. § 15b ET SEQ., AS AMENDED
(THE “FEDERAL ACT”), IN RELIANCE UPON ONE (1) OR MORE EXEMPTIONS FROM THE
REGISTRATION REQUIREMENTS OF THE FEDERAL ACT. IN ADDITION, THE ISSUANCE OF THIS
SECURITY HAS NOT BEEN QUALIFIED UNDER THE DELAWARE SECURITIES ACT OR ANY OTHER
STATE SECURITIES LAWS (COLLECTIVELY, THE “STATE ACTS”), IN RELIANCE UPON ONE (1)
OR MORE EXEMPTIONS FROM THE REGISTRATION PROVISIONS OF THE STATE ACTS. IT IS
UNLAWFUL TO CONSUMMATE A SALE OR OTHER TRANSFER OF THIS SECURITY OR ANY INTEREST
THEREIN TO, OR TO RECEIVE ANY CONSIDERATION THEREFOR FROM, ANY PERSON OR ENTITY
WITHOUT THE OPINION OF COUNSEL FOR THE COMPANY THAT THE PROPOSED SALE OR OTHER
TRANSFER OF THIS SECURITY DOES NOT AFFECT THE AVAILABILITY TO THE COMPANY OF
SUCH EXEMPTIONS FROM REGISTRATION AND QUALIFICATION, AND THAT SUCH PROPOSED SALE
OR OTHER TRANSFER IS IN COMPLIANCE WITH ALL APPLICABLE STATE AND FEDERAL
SECURITIES LAWS. THE TRANSFER OF THIS SECURITY IS FURTHER RESTRICTED UNDER THE
TERMS OF THE LIMITED LIABILITY COMPANY AGREEMENT GOVERNING THE COMPANY, A COPY
OF WHICH IS ON FILE WITH THE COMPANY.