exv10w38



 





Exhibit 10.38




AGREEMENT OF PURCHASE AND SALE




BETWEEN




FIRST STATES INVESTORS 228, LLC,

a Delaware limited liability company, as SELLER




AND




FPG DF LINCOLN STREET, LLC,

a Delaware limited liability company, as BUYER




Dated: November 2, 2006




 









 





TABLE OF CONTENTS




	 	 	 	 	 
	 	 	Page	 
	1. AGREEMENT TO BUY AND SELL
	 	 	1	 
	2. PURCHASE PRICE
	 	 	2	 
	3. ESCROW AGENT
	 	 	3	 
	4. TITLE; SURVEY
	 	 	3	 
	5. DEFEASANCE OF MORTGAGE
	 	 	5	 
	6. ESTOPPEL CERTIFICATES AND NON-DISTURBANCE AGREEMENT
	 	 	6	 
	7. OPERATION OF THE PROPERTY PRIOR TO CLOSING
	 	 	7	 
	8. REPRESENTATIONS AND WARRANTIES
	 	 	8	 
	9. CONDITIONS PRECEDENT TO CLOSING
	 	 	13	 
	10. RISK OF LOSS
	 	 	14	 
	11. CLOSING
	 	 	15	 
	12. PRORATIONS AND CHARGES
	 	 	16	 
	13. INSTRUMENTS OF CONVEYANCE AND OTHER DOCUMENTS
	 	 	20	 
	14. DELIVERY AND PAYMENT
	 	 	22	 
	15. BREACH
	 	 	23	 
	16. NO OUTSIDE REPRESENTATIONS/AS-IS SALE/SURVIVING
OBLIGATIONS
	 	 	24	 
	17. SURVIVABILITY
	 	 	26	 
	18. NOTICES
	 	 	26	 
	19. BROKER’S COMMISSION
	 	 	27	 
	20. BINDING EFFECT
	 	 	28	 
	21. ASSIGNMENT
	 	 	28	 
	22. SELLER’S LIMITED LIABILITY
	 	 	29	 
	23. TAX FREE EXCHANGE
	 	 	29	 
	24. SECTION HEADINGS
	 	 	29	 
	25. PRONOUNS
	 	 	29	 
	26. AGREEMENT IN COUNTERPARTS
	 	 	29	 
	27. GOVERNING LAW
	 	 	30	 
	28. TIME OF THE ESSENCE; FAILURE TO ENFORCE NOT A WAIVER
	 	 	30	 
	29. SEVERABILITY
	 	 	30	 






 









 






	 	 	 	 	 
	 	 	Page	 
	30. CONFIDENTIALITY/NO PUBLIC DISCLOSURE
	 	 	30	 
	31. NO PARTNERSHIP
	 	 	30	 
	32. INTENTIONALLY OMITTED
	 	 	30	 
	33. NO RECORDATION
	 	 	30	 
	34. RIGHT OF FIRST REFUSAL
	 	 	31	 
	35. THIRD PARTY BENEFICIARY
	 	 	32	 






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AGREEMENT OF PURCHASE AND SALE




     THIS AGREEMENT OF PURCHASE AND SALE (“Agreement”) dated as of November 2, 2006 is between
First States Investors 228, LLC, a Delaware limited liability company (“Seller”), and FPG DF
Lincoln Street, LLC, a Delaware limited liability company (“Buyer”).



RECITALS




     A. Seller is the owner of a certain tract of land comprised of two (2) parcels of property,
together with a 36 story office tower (the “Building”) and an underground five (5) story parking
garage (the “Garage”) and other improvements thereon, collectively known as State Street Financial
Center, One Lincoln Street, Boston, Suffolk County, Massachusetts.



     B. Seller is the landlord under that certain lease demising portions of the Building (the “SSB
Office Lease”) and that certain lease demising the Garage (the “SSB Garage Lease”; collectively
with the SSB Office Lease, the “State Street Leases”) with SSB Realty LLC (the “State Street
Tenant”).



     C. Seller desires to sell the Property (as hereinafter defined), including, without
limitation, Seller’s interest in the State Street Leases, to Buyer, and Buyer desires to acquire
the Property from Seller.



     NOW, THEREFORE, in consideration of the mutual covenants and promises set forth in this
Agreement, and for other valuable consideration, the receipt and sufficiency of which is each
hereby acknowledged, Seller and Buyer agree as follows:




1. AGREEMENT TO BUY AND SELL.



     Seller shall sell and convey to Buyer, and Buyer shall purchase and accept from Seller, all of
Seller’s right, title, estate, and interest in and to:




     (a) the land described on Schedule 1(a), which is attached to and made a part of this
Agreement, together with all easements, privileges, and appurtenant rights belonging or in
any way appertaining to the land (collectively, the “Land”);




     (b) the Building, Garage and other improvements, and all fixtures attached to the Land
and buildings (collectively, the “Improvements”, and together with the Land, the “Real
Property”);




     (c) such furnishings, furniture, equipment, supplies, and other personal property, if
any, as are owned by Seller and are currently located in or on the Real Property and used
exclusively in the operation or maintenance of the Real Property, but excluding those items
of personal property which are owned by tenants, licensees or other third parties or which may be removed by such parties under the terms of their leases
or which are located in Seller’s or Seller’s agent’s property management office, if any, on



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the Real Property (collectively, the “Personal Property”). The Personal Property is
conveyed subject to depletions, replacements and additions in the ordinary course of
Seller’s business;




     (d) the State Street Leases (as described on Schedule 1(d);




     (e) the State Street Lease Guarantees (as described on Schedule 8 (a) (xi);




     (f) all other agreements, contracts, and contract rights pertaining to the Property and
to which Seller is a party, which have not been assigned to the State Street Tenant pursuant
to its exercise of the SSB Management Rights (as defined in Section 8 (a) (vi) hereof) and
which are assignable by Seller, including without limitation, those described on Schedule
1(e), which is attached to and made a part of this Agreement (collectively, the “Service
Contracts”); and




     (g) all intangible property owned by Seller and used in connection with the Real
Property and Personal Property, including all trademarks and trade names used in connection
with the Property, all plans and specifications, if any, in the possession of Seller which
were prepared in connection with the construction of the Improvements and all licenses,
permits and warranties now in effect with respect to the Property, all to the extent
assignable (collectively, the “Intangible Property”).



     The Real Property, the Personal Property, the State Street Leases, the Service Contracts and
the Intangible Property are collectively referred to in this Agreement as the “Property”.




2. PURCHASE PRICE.




     (a) Subject to the charges and prorations set forth in Section 12 of this Agreement,
Buyer shall pay to Seller at Closing (as hereinafter defined) the sum of Eight Hundred
Eighty Nine Million Dollars ($889,000,000) (the “Purchase Price”) for the purchase of the
Property. The Purchase Price shall be payable by wire transfer of immediately available
federal funds to a bank account designated by Seller to Buyer in writing prior to the
Closing. To enable Seller to make conveyance as herein provided, Seller may, at the
Closing, use the purchase money or any portion thereof to clear the title of any or all
encumbrances or interests, provided that provision reasonably satisfactory to Buyer’s and
Buyer’s lender’s attorneys is made at the Closing for prompt recording of all instruments so
procured.




     (b) On or before 1:00 p.m. Eastern Standard Time on the first business day immediately
following the date of this Agreement, Buyer shall deposit the sum of Twenty Million Dollars
($20,000,000) (the “Deposit”) with Deposit Escrow Agent (as hereinafter defined). If Buyer
closes the transactions contemplated by this Agreement, the Deposit, together with all
interest earned thereon, shall be applied to the Purchase Price.
Otherwise, Deposit Escrow Agent shall disburse the Deposit, together with all interest
thereon, to the party entitled to receive the Deposit as provided by this Agreement.



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3. ESCROW AGENT.



     Chicago Title Insurance Company (“Deposit Escrow Agent” or “Title Company”) shall serve as
escrow agent for the Deposit (“Escrow Agent”) pursuant to the terms of the escrow agreement (the
“Deposit Escrow Agreement”) attached hereto as Schedule 3.




4. TITLE; SURVEY.




     (a) For Buyer’s convenience, Seller has (i) attached hereto as Schedule 4(a) a
commitment by the Title Company to issue an owner’s policy of title insurance insuring the
Real Property (the “Title Commitment”), and (ii) has delivered to Buyer an ALTA survey (the
“Survey”) provided with respect to the Real Property entitled State Street Financial
Center”, dated December 17, 2003, and prepared by Gunther Engineering, Inc. All matters
disclosed by the Survey and all matters set forth in the following sections or provisions of
the Title Commitment are deemed approved by Buyer as “Permitted Exceptions”, except as
otherwise provided in paragraph (d) below: Item 2 in Schedule B, Section 1 and Items 2, 3
and 5 through 14 in Schedule B, Section 2 of the Title Commitment.




     (b) With respect to any continuation or update of the Title Commitment or any update of
the Survey obtained by Buyer subsequent to the date of the Title Commitment, Buyer shall
deliver to Seller, within one (1) business day of receipt of such continuation or update, a
copy of such continuation or update together with a written statement by Buyer of any
objections to title which have appeared for the first time in such continuation or update
(collectively, a “Title Objection”); it being understood that Buyer may not raise as a
Title Objection any matter which pursuant to the following subsection (c) Buyer has agreed
to accept title subject to. If any matter is unsatisfactory, Buyer must specify in such
written notice (the “Title Notice”) the reason such matter(s) are not satisfactory and the
curative steps necessary to remove the basis for Buyer’s disapproval. The parties shall
then have until five (5) business days after the Title Notice (the “Response Date”) to make
such arrangements or take such steps as they shall mutually agree to satisfy Buyer’s
objections(s); provided, however, that Seller shall have no obligation whatsoever to expend
or agree to expend any funds, to undertake or agree to undertake any obligations or
otherwise to attempt to cure or agree to attempt to cure any Title Objections, and Seller
shall not be deemed to have any obligation to attempt to cure any such matters unless Seller
expressly undertakes such an obligation by a written notice to or written agreement with
Buyer given or entered into on or prior to the Response Date and which recites that it is in
response to a Title Notice. Buyer’s sole right with respect to any Title Objections
contained in a Title Notice which Seller has not agreed to satisfactorily resolve shall be
to elect on or before the date which is one
business day after the Response Date to terminate this Agreement in accordance with
Section 5(f) hereof, in which event the Deposit, and all interest thereon, shall be returned
to Buyer, and neither party shall have any further liability to the other hereunder, except
as otherwise provided herein. All Title Objections not included in a Title Notice given by
Buyer to Seller or with respect to which a timely Title Notice is given but Seller fails to




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expressly agree to attempt to cure as provided above shall be deemed approved by Buyer as
“Permitted Exceptions” as provided in paragraph (c).




     (c) At the Closing, Seller shall convey title to the Real Property to Buyer by
Massachusetts statutory (M.G.L. ch.183, Sec.11) quitclaim deed (the “Deed”), duly executed
and acknowledged by Seller and in proper form for recording, conveying good and clear record
marketable fee simple title to the Real Property to Buyer, subject to no exceptions other
than (i) matters created by or to be assumed by Buyer; (ii) matters specifically set forth
in this Agreement; (iii) zoning, building ordinances and bylaws and provisions of existing
and future laws, regulations, restrictions, requirements, ordinances, resolutions and orders
(including, without limitation, any relating to building, zoning and environmental
protection) as to the use, occupancy, subdivision or improvement of the Real Property; (iv)
general and special real estate taxes and assessments (whether or not then a lien on the
date of Closing, but subject to adjustment as hereinafter provided); (v) legal roadways and
highways; (vi) nonmaterial encroachments over a building setback or property line, a
prohibited encroachment of a nonmaterial nature over any easement or any other matter which
does not materially interfere with the use of the Real Property; (vii) the State Street
Leases (and the interests of the tenants and subtenants thereunder); (viii) any state of
facts that a personal inspection of the Real Property might disclose; (ix) any lien or
encumbrance (other than the Permitted Exceptions and subject to the provisions of the
following subsection 4(d)) encumbering the Real Property as to which Seller shall deliver to
Buyer, or to Buyer’s Title Company at or prior to the Closing, payment sufficient to satisfy
the obligations secured by such lien or encumbrance (in the case of liens or encumbrances,
if any, which secure the payment of money) or proper instruments, in recordable form, which
upon recordation will cancel such lien or encumbrance, together with any other instruments
necessary thereto and the cost of recording and canceling the same and which lien or
encumbrance the Title Company will insure, or commit to insure, Buyer against loss or
forfeiture of title to, or collection from, the Real Property without additional cost to
Buyer; (x) any lien or encumbrance that the State Street Tenant is obligated to discharge
under the State Street Leases, and (xi) the Permitted Exceptions. All of the foregoing
exceptions shall be referred to collectively as the “Conditions of Title”.




     (d) Notwithstanding the foregoing, however, Seller agrees to take the actions
reasonably necessary, as provided in Section 5 below, to defease the loan secured by, and
caused to be discharged of record (as contemplated by subsection (c) (ix)) that certain
Mortgage and Security Agreement, dated February 17th, 2004, made by Seller to
Lehman Brothers Bank, FSB and any assignment of lease or UCC financing statement executed in
connection with said mortgage (collectively, the “Mortgage”). Seller also agrees to
discharge other encumbrances securing the payment of money, which may be placed by reason of
the act or omission of Seller on the Property at any time up to and including the date of
Closing (collectively, “Monetary Liens”).




     (e) By acceptance of the Deed and the Closing of the purchase and sale of the Property
Buyer agrees that Seller shall have conclusively satisfied its obligations with respect to
title to the Property. The provisions of this Section 4 shall survive the Closing.



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     (f) If, pursuant to the provisions of Section 34, a ROFR Termination Event (hereinafter
defined) has occurred Buyer may not assert the Right of First Refusal (as hereinafter
defined) as an objection to title or Title Objection. In the event at the time of a
Scheduled Closing Date there is either (x) a notice of pendency filed against the Property,
or (y) an injunction issued staying the Closing or the Seller or Buyer from effecting the
Closing, in either of (x) or (y) by reason of a lawsuit commenced by IPC (hereinafter
defined) claiming a breach of the Right of First Refusal (hereinafter defined), then such
notice of pendency and/or injunction shall be deemed a Title Objection for the purposes of
this Section 4. In the event of a ROFR Termination Event occurred by reason , of IPC not
having accepted the offer set forth in the ROFR Offer Notice, as described in Section 34
hereof, Seller shall upon the request of the title company insuring Buyer’s title to the
Real Property deliver to such title company a certificate stating that Seller did not
receive an acceptance of the offer set forth in the ROFR Offer Notice.




5. DEFEASANCE OF MORTGAGE.




     (a) Seller and Buyer acknowledge that to complete the transactions herein contemplated
the Mortgage must be defeased prior to Closing. Buyer further acknowledges that it has
received and reviewed Section 2.4 of the Loan Agreement executed between Seller and Lehman
Brothers Bank FSB in connection with the Mortgage, which section sets forth the procedures
for defeasance of the Mortgage.




     (b) Seller agrees that it shall take such reasonable and customary actions as may be
required to effect such defeasance and thereby discharge of record the Mortgage.




     (c) Buyer covenants and agrees that it shall take all reasonable and customary actions
(at Seller’s expense (other than Buyer’s legal fees)) to assist Seller in connection with
the defeasance. Without limiting the generality of the foregoing, not later than the fifth
(5th) business day prior to the Scheduled Closing Date (such date being time of
the essence), Buyer (at Seller’s request) shall enter into, and shall take such reasonable
and customary actions to cause any mortgage lender providing it financing for this
transaction to enter into, an escrow agreement to be prepared by Seller (the “Closing Escrow
Agreement”) with Seller, the title company that shall insure Buyer’s title (the “Closing
Escrow Agent”) and the holder of the Mortgage (or its servicer), which Closing Escrow
Agreement shall provide (A) that Buyer and/or its mortgage lender shall deposit into escrow
with the Escrow Agent on or before 12:00 p.m. EST on the second (2nd) business
day (unless the holder of the Mortgage or its servicer requires it to be done on the third
(3rd)) prior to the Scheduled Closing Date (as such term is defined in Section 11
and such date and time being time of the essence), funds (the “Funds”) in that amount
necessary to purchase the Defeasance Collateral (as defined in said Loan Agreement), (B)
that the Funds shall be
released from escrow to purchase the Defeasance Collateral
immediately
prior to the transfer of title to the Property to Buyer, subject only to the Title
Company agreeing to issue a title commitment in favor of the Buyer’s mortgage lender,
effective as of the date of release of the Funds, which commitment shall insure the mortgage
to be taken by such lender as a first priority mortgage lien, subject only to the exceptions
to title that Buyer is required to accept under this Agreement,(C) that the Funds shall be



5









 







released from escrow and returned to Buyer in the event Buyer is entitled to a return of the
Deposit, and (D) such other terms and conditions as are customary in transactions involving
the simultaneous sale of property and the defeasance of the mortgage encumbering such
property. The aforesaid reference to the Buyer’s mortgage lender shall not be deemed to mean
that this transaction is subject to or contingent upon Buyer obtaining financing.




     (d) Seller and Buyer shall upon request provide to the other reasonable evidence of the
actions each has taken to discharge their respective obligations under the foregoing
provisions of this Section 5.




     (e) Buyer shall engage a title company to insure Buyer’s title to the Real Property,
which title company shall perform, without compensation, the obligations of the Closing
Escrow Agent set forth in this Agreement (including without limitation, the obligations set
forth in subsection (c) above).




6. ESTOPPEL CERTIFICATES AND NON-DISTURBANCE AGREEMENT




     (a) (i) Seller shall request of the State Street Tenant that it execute and deliver (i)
an estoppel certificate with respect to the SSB Office Lease and the SSB Garage Lease
substantially in the form attached to the SSB Office Lease and substantially in the form
required by the SSB Garage Lease (collectively, the “SSB Estoppel”), and (ii) a statement
pursuant to Section 24.3(d) of the SSB Office Lease (as amended and restated pursuant to
Section 7 of that certain Second Amendment to Lease, dated as of February 13, 2004, which
forms a part of the SSB Office Lease (the “Second Lease Amendment”)), substantially to the
effect that the State Street Tenant’s right of first offer has been waived or lapsed with
respect to the sale of the Real Property provided for under this Agreement (the “SSB RoFo
Certificate”).




           (ii) It shall be a condition of Buyer’s obligation to close title hereunder that the
Seller deliver to Buyer the SSB RoFo Certificate and the SSB Estoppel and that the SSB
Estoppel not contain statements which are inconsistent, in any material respect, with the
representations of Seller contained in Section 8(a) (vi) hereof. In the event the SSB
Estoppel contains statements that are materially inconsistent with such Seller’s
representations then the SSB Estoppel shall nonetheless be deemed acceptable, provided that
Seller (if it shall so elect) shall either provide Buyer with a credit against the Purchase
Price in the amount necessary to cure the defaults of Seller set forth in the SSB Estoppel
(provided that such defaults are reasonably quantifiable) or, if Seller shall dispute that
such default(s) exists, deposit with the Deposit Escrow Agent the estimated amount of the
cost to cure such default(s), provided that such defaults are reasonably
quantifiable, which deposit shall be held by the Deposit Escrow Agent under the terms of an
escrow agreement substantially in accordance with the Deposit Escrow Agreement and which
shall provide that the deposited sums shall be released to Seller and/or Buyer, as the case
may be (i.e., Seller shall be entitled to the amounts relating to any disputes with the
State Street Tenant which are resolved in Seller’s favor and Buyer shall be entitled to the
amounts relating to any disputes which are resolved in the State Street Tenant’s favor, less
any sums which shall have been paid or is payable to State Street



6









 







Tenant.) Seller shall
have the right to take such actions as may be necessary to pursue any such disputes,
including commencing and defending actions, as appropriate, against the State Street Tenant.
In the event that any such dispute shall not have been resolved within eighteen (18) months
following the Closing (plus such additional time as may be necessary to complete any appeal
of any such action or proceeding), then Buyer shall have the right upon thirty (30) days
prior notice to Seller, to assume the responsibility to contest (in good faith) and/or
settle such dispute on Seller’s behalf. Any such settlement shall require Seller’s consent,
which shall not be unreasonably withheld or delayed. The provisions of this Section shall
survive the Closing. The Seller amounts that shall be credited against the purchase price
or deposited in escrow, as provided above, shall be mutually agreed to by Seller and Buyer
in the exercise of their reasonable good faith judgment.




          (iii) Notwithstanding anything to the contrary set forth in this Agreement (i) if the
State Street Tenant shall deliver a single estoppel certificate with respect to both the SSB
Office Lease and the SSB Garage Lease, such single certificate shall be treated as the SSB
Estoppel if it otherwise satisfies the provisions of this Section, and (ii) if the SSB
Estoppel contains provisions that are substantially the same as those required to be set
forth in the SSB RoFo Certificate, then the delivery of such SSB RoFo Certificate shall not
be required under this Agreement.




     (b) Seller agrees that it shall request that the State Street Tenant execute and
deliver to any lender that will be providing mortgage financing for its acquisition, a
subordination, non-disturbance and attornment agreement in the form specified under the
State Street Leases.




7. OPERATION OF THE PROPERTY PRIOR TO CLOSING.




     (a) From the date of this Agreement to the Closing Date, Seller:




     (i) shall maintain and operate the Real Property, subject to the SSB Management
Rights (as defined in Section 8 (a) (vi)) and in accordance with the Seller’s
practices since the State Street Tenant has commenced the exercise of the SSB
Management Rights;




     (ii) shall not modify, amend, renew, extend or terminate any of the State
Street Lease Guarantees or State Street Leases without the prior written consent of
Buyer, unless such modification, amendment, renewal, extension or
termination is required pursuant to the terms of any of the State Street Leases
or is entered into to effectuate or memorialize the exercise of any right or option
contained in any of the State Street Leases. Further, Seller may grant such
consents as may be required to be granted by the lessor under the State Street
Leases (including those consents as to which the lessor’s consent is required to not
be unreasonably withheld). In no event, however, shall Seller exercise any right,
with respect to a proposed subletting, to recapture any portion of the premises
demised under the State Street Leases, without the consent of Buyer. In the event
Seller takes any action under this subsection that does not require



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Buyer’s consent
Seller shall make reasonable efforts to provide Buyer with reasonably prompt notice
prior to such action.




     (iii) shall not (x) enter into any new leases or tenancies with respect to the
Property, or (y) except to the extent required under the State Street Leases, enter
into any other new agreements or contracts which would be binding on Buyer, unless
the same are terminable upon not more than thirty (30) days’ notice;




     (iv) shall maintain and keep in full force and effect insurance on the Real
Property in amounts substantially comparable to that currently in effect; and




     (v) shall comply, in all material respects, with the terms and provisions of
the State Street Leases.




(b) Buyer covenants and agrees that it shall not communicate with State Street
Tenant without Seller’s consent, provided, however, (i) that Buyer may meet with
State Street Tenant if Seller is given reasonable advance notice of such meeting and
is afforded an opportunity to attend such meeting, and (ii) may enter into written
communications with State Street Tenant, provided that true and complete copies of
all such communications shall be promptly delivered to Seller. For the avoidance of
doubt, email and text communications shall be deemed to be written communications.




(c) Seller covenants and agrees to promptly request of all third party consultants
and providers of reports relating to the Project and delivered to Buyer that said
consultants issue to Buyer and its permitted assigns, lenders and rating agencies
such reports and reliance letters relating thereto as Buyer shall reasonably
request.




8. REPRESENTATIONS AND WARRANTIES.




     (a) Seller represents and warrants to Buyer as follows:




     (i) Seller is and will be on the Closing Date a limited liability company duly
organized and validly existing under the laws of the State of Delaware, and Seller
has and will have on the Closing Date all necessary power and authority to: (A)
carry on the business for which it has been organized; (B) own and operate the
Property; and (C) enter into and perform Seller’s obligations under this Agreement.




     (ii) Seller has taken all actions required to be taken under the laws of the
State of Delaware and under Seller’s operating agreement to approve or authorize the
execution and delivery of this Agreement and consummation of the transactions
contemplated in this Agreement.



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     (iii) Neither the execution of this Agreement nor the consummation of the
transactions contemplated in this Agreement will constitute a violation of, be in
conflict with, or constitute a default under (or with the passage of time or
delivery of notice, or both, would constitute a default under) any term or provision
of Seller’s operating agreement or, to the actual knowledge of Seller, any other
agreement, lease, or other instrument by which the Property is bound.




     (iv) No litigation, proceeding, or action is pending or, to Seller’s actual
knowledge, threatened against or relating to the Property or Seller, that could
materially adversely affect the Property or its ownership or operation by Buyer,
except as shown on Schedule 8(a)(iv).




     (v) No condemnation proceeding is pending or, to Seller’s actual knowledge,
threatened against or relating to the Real Property.




     (vi) As to the State Street Leases:




     (A) the State Street Leases are set forth on Schedule 1(d) and true,
complete and correct copies of the State Street Leases (including all
amendments thereto) have been delivered to Buyer;




     (B) except as disclosed on Schedule 8(a)(vi)(B), which is attached to
and made a part of this Agreement, (x) to the actual knowledge of Seller
the State Street Tenant is not in default in any material respect under the
terms of the State Street Leases and (y) Seller has not delivered to the
State Street Tenant a notice of any material default;




     (C) except as disclosed on Schedule 8(a)(vi)(C), which is attached to
and made a part of this Agreement, to the actual knowledge of the Seller
(x)the State Street Tenant has not made any written claim that the Seller is
in default in any material respect under the terms of the State Street
Leases, and (y) Seller is not in material default under the State Street
Leases;




     (D) the State Street Tenant has elected pursuant to Section 2.2(a) of
the Second Amendment to assume certain responsibilities with respect to the
operation and management of the Property (the “SSB Management Rights”);




     (E) the Seller has delivered to the State Street Tenant the Offer
Notice (as such term is defined in the Second Amendment), a true and
complete copy of such Offer Notice is attached hereto as Schedule
8(a)(vi)(E), and the State Street Tenant has not delivered to Seller a
Notice of Interest (as defined in the Second Amendment);



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     (F) the Seller has not entered into, nor assumed the obligations under,
any brokerage agreement with respect to the State Street Leases; and




     (G) there are no sums due to the State Street Tenants with respect to
tenant improvements the State Street Tenants have made to the Real Property.




     (vii) As to the Service Contracts,





     (A) complete, true, and correct copies of all written Service Contracts
disclosed on Schedule 1(e) have been delivered to Buyer (it being
acknowledged by Buyer that in light of the State Street Tenant having
elected the SSB Management Rights there may be other agreements that affect
the operation of the Property that are not Service Contracts hereunder);




     (B) except as disclosed on Schedule 8(a)(vii)(B), which is attached to
and made a part of this Agreement, to the actual knowledge of Seller,
neither Seller nor any other party under any Service Contract is in default
in any material respect under any Service Contract.




     (viii) Seller is not (x) identified on the OFAC List (as hereinafter defined)
or (y) a person with whom a citizen of the United States is prohibited to engage in
transactions by any trade embargo, economic sanction, or other prohibition of United
States law, rule, regulation, or Executive Order of the President of the United
States. The term “OFAC List” shall mean the list of specially designated
nationals and blocked persons subject to financial sanctions that is maintained by
the U.S. Treasury Department, Office of Foreign Assets Control and any other similar
list maintained by the U.S. Treasury Department, Office of Foreign Assets Control
pursuant to any law, rule, regulation or Executive Order of the President of the
United States, including, without limitation, trade embargo, economic sanctions, or
other prohibitions imposed by Executive Order of the President of the United States.




     (ix) the Seller has delivered to Buyer a true and complete copy of that certain
License Agreement, dated July 1, 2004, between Seller and the Boston Fire Department
(the “License Agreement”).




     (x) Seller has not granted (and to the actual knowledge of Seller there are no)
rights of first refusal, rights of first offer, options or similar rights to
purchase the Real Property, other than the Right of First Refusal (as hereinafter
defined) and the above described right of first offer held by the State Street
Tenant.




     (xi) the Seller has delivered to Buyer true and complete copies (including any
amendments thereto) of those certain guarantees (the “State Street



10









 







Lease Guarantees)
of the State Street Leases and which State Street Lease Guarantees are described on
Schedule 8(a)(xi) hereto. To Seller’s actual knowledge State Street Corporation is
not in default in any material respect under the terms of the State Street Lease
Guarantees. The Seller has not delivered to the State Street Corporation any notice
alleging a default under the terms of said guarantees.




     (xii) the Seller has delivered to Buyer true and complete copies of the
following two certain Phase I environmental reports that it commissioned with
respect to the Real Property: reports of Haley & Aldrich, dated February, 2004 and
EMG, dated October 2, 2006. Seller has not commissioned any other Phase I or
similar report.




     (xiii) the “operating report” attached to this Agreement as Exhibit B was
prepared by Seller or its affiliate in the normal course of its business.




     (b) Buyer represents and warrants to Seller as follows:




     (i) Buyer is a Delaware limited liability company, duly organized, validly
existing and in good standing under the laws of the State of Delaware, and qualified
to do business in the jurisdiction in which the Property is located, and Buyer has
and will have on the Closing Date all necessary power and authority to: (A) carry
on the business for which it has been organized; (B) own and operate the Property;
and (C) enter into and perform Buyer’s obligations under this Agreement.




     (ii) Buyer has taken all actions required to be taken under the laws of the
State of Delaware and under Buyer’s partnership agreement, articles of incorporation
and by-laws or articles of organization and operating agreement, as the case may be,
to approve or authorize the execution and delivery of this Agreement and
consummation of the transactions contemplated in this Agreement.




     (iii) Neither the execution of this Agreement nor the consummation of the
transactions contemplated in this Agreement will constitute a violation of, be
in conflict with, or constitute a default under (or with the passage of time or
delivery of notice, or both, would constitute a default under) any term or provision
of Buyer’s partnership agreement, articles of incorporation and by-laws or articles
of organization and operating agreement, as the case may be, or any other agreement
or other instrument to which Buyer is bound.




     (iv) Buyer has not (A) made a general assignment for the benefit of creditors,
(B) filed any voluntary petition in bankruptcy or suffered the filing of any
involuntary petition by Buyer’s creditors, (C) suffered the appointment of a
receiver to take possession of all, or substantially all, of Buyer’s assets, (D)
suffered the attachment or other judicial seizure of all, or substantially all, of
Buyer’s assets, (E) admitted in writing its inability to pay its debts as they come



11









 







due, or (F) made an offer of settlement, extension or composition to its creditors
generally.




     (v) Buyer is not (x) identified on the OFAC List, or (y) a person with whom a
citizen of the United States is prohibited to engage in transactions by any trade
embargo, economic sanction, or other prohibition of United States law, rule,
regulation, or Executive Order of the President of the United States.




     (c) When the phrase “to Seller’s actual knowledge” or similar phrase is used with
respect to Seller, it shall (i) be limited to the actual knowledge of Michael Maher only,
who is the employee of Seller’s affiliate and is, and has since the date Seller acquired the
Property been, charged with the day to day operations of the Property, (ii) be deemed to
refer to the current actual, not implied, constructive or imputed, knowledge of such person
as management agent as aforesaid, and not individually, as of the times expressly indicated
only, and without any obligation to make any independent investigation of, or any implied
duty to investigate, the matters being represented and warranted, or to make any inquiry of
any other persons, or to search or to examine any files, records books, correspondence and
the like, and (iii) not be construed to refer to the knowledge of any other beneficial
owner, officer, director, employee, shareholder or agent of Seller. There shall be no
personal liability on the part of the individual named above arising out of any
representations or warranties made herein or otherwise.




     (d) If after the date of this Agreement but prior to the Closing, Buyer obtains
knowledge that any of Seller’s representations and warranties are untrue, inaccurate or
incorrect in any material respect, Buyer shall give Seller notice thereof within five (5)
business days of obtaining such knowledge (but, in any event, prior to the Closing). If
after the date of this Agreement but prior to the Closing, Seller obtains actual knowledge
that any of Seller’s representations and warranties are untrue, inaccurate or incorrect in
any material respect, Seller shall give Seller notice thereof within five (5) business days
of obtaining such knowledge (but, in any event, prior to the Closing). In either such
event, Seller shall have the right to cure such misrepresentation or breach and shall be
entitled to a reasonable adjournment of the Closing (no to exceed ninety (90) days) for the
purpose of such cure. Seller reserves the right, at its sole discretion, at any time during
such period to notify Buyer that it no longer elects to endeavor to effect any such
cure, in which event Buyer shall have two (2) business days from such notice in which
to notify Seller of its election as provided in the next succeeding sentence. If Seller is
unable or elects not to so cure any such misrepresentation or breach, then Buyer, as its
sole remedy for any and all such materially untrue, inaccurate or incorrect representations
or warranties, shall elect either (i) to waive such misrepresentations or breaches or
representations or warranties and consummate the transactions without any reduction of or
credit against the Purchase Price, or (ii) to terminate this Agreement by notice given to
Seller on the Closing Date, in which event this Agreement shall terminate, the Deposit and
all interest thereon shall be returned to Buyer and neither party shall have any further
liability to the other hereunder, except as may otherwise provided herein. The untruth,
inaccuracy or incorrectness of a Seller’s representation or warranty shall be deemed
material only if Buyer’s aggregate damages (including a diminution in the value of the



12









 







Property) resulting from any such untruths, inaccuracies or incorrectness are reasonably
estimated to exceed $5,000,000.




     (e) The representations and warranties set forth in this Section 8 shall survive for
the period of 270 days following consummation of the transactions contemplated by this
Agreement and the recording the Deed and Seller shall be liable to Buyer hereunder for a
breach of a Seller’s representations with respect to which a claim is made by Buyer against
Seller on or before the expiration of said 270 day period and an action is commenced by
Buyer against Seller with respect to such claim within ninety (90) days after such claim is
made. Anything in this Agreement to the contrary notwithstanding, the maximum aggregate
liability of Seller for breaches of Seller’s representations discovered following the
Closing shall not exceed the lesser of Buyer’s actual damages and Twenty Million Dollars
($20,000,000) in the aggregate, nor shall any claim be made for any item for which the claim
of damage is less than Five Hundred Thousand Dollars ($500,000). Notwithstanding the
foregoing, however, if the Closing occurs, Buyer hereby expressly waives, relinquishes and
releases any right or remedy available to it at law or in equity, under this Agreement or
otherwise to make a claim against Seller for damages that Buyer may incur, or to rescind
this Agreement and the transaction, as the result of any of Seller’s representations being
untrue, inaccurate or incorrect if Buyer knew or is deemed to know at the time of the
Closing that such representation or warranty was untrue, inaccurate or incorrect.




9. CONDITIONS PRECEDENT TO CLOSING.




     (a) Buyer’s obligations under this Agreement are expressly conditioned upon completion
or satisfaction of the following matters on or prior to the Closing Date:




     (i) Seller shall have complied, in all material respects, with its obligations
under this Agreement. Without limiting the generality of the foregoing provision,
Seller shall have deposited or have caused to be deposited with the Closing Escrow
Agent all documents required of Seller to be deposited into Escrow hereunder;




     (ii) the SSB RoFo Certificate and the SSB Estoppel in the form required by
Section 6 are delivered to Buyer;




     (iii) The representations and warranties of Seller contained in Section 8(a) of
this Agreement shall be true and correct in all material respects as of the Closing
Date, subject to Section 8(c), (d) and (e) above; and




     (iv) The Real Property is in the As Is Condition (as hereinafter defined).




     (b) Seller’s obligations to perform hereunder are expressly contingent and conditional
upon the satisfaction of the following:



13









 






     (i) Buyer shall have complied, in all material respects, with its obligations
under this Agreement. Without limiting the generality of the foregoing provision,
Buyer shall have deposited or have caused to be deposited with the Closing Escrow
Agent all documents and funds required of Buyer to be deposited into Escrow or paid
hereunder; and




     (ii) The representations and warranties of Buyer contained in Section 8(b) of
this Agreement shall be true and correct in all material respects as of the Closing
Date.




(c) It shall be a condition of each party’s obligation to close on the Closing Date
that (i) a ROFR Termination Event shall have occurred, and (ii) a defeasance of the
Mortgage, as contemplated by Section 5, shall have been effected.




(d) The parties acknowledge that the conditions precedent set forth in subsection
(a) above are for the benefit of Buyer and that the conditions precedent set forth
in subsection (b) above are for the benefit of Seller. Unless otherwise
specifically set forth herein, the date by which the conditions precedent must be
satisfied shall be the Closing Date. If any of the conditions precedent set forth
in subsection (a) or subsection (b) above are not satisfied on or before the date by
which they are required to be satisfied, the party for whose benefit the condition
precedent exists shall have the right to waive such condition and, to the extent
applicable, the rights under Section 15 of this Agreement. If such waiver is not
given then, subject to the rights of the parties under Section 15 hereof in the
event a condition was not satisfied by reason of a default by a party, this
Agreement shall terminate, the Buyer shall be entitled to a return of the Deposit
and all interest thereon, and neither party shall have any rights or obligations
hereunder, except those that survive any such termination of this Agreement.




10. RISK OF LOSS.




     (a) If any part of the Real Property is damaged or destroyed by fire or any other cause
(“Damage”) or subject to a pending, threatened, or completed taking by condemnation or
eminent domain, or a proposed conveyance under threat of either (“Taking”), Seller shall,
obtaining knowledge of same, promptly notify Buyer of the same.




     (b) If the extent of the Damage is such that either the State Street Tenant or Seller
shall have the right under the terms of the SSB Office Lease to terminate such lease, then
Buyer may terminate this Agreement by giving written notice of such termination within ten
(10) days after Seller’s notice of such Damage; provided, however, that if Buyer elects to
so terminate, Seller shall have the right to render such election null and void by giving
notice to Buyer, within ten (10) business days after Seller’s receipt of Buyer’s notice of
election to terminate, confirming that as a condition to the performance of Buyer’s
obligations hereunder, Seller shall not exercise any right it may have to terminate the
State Street Leases on account of the Damage and that Seller shall deliver to Buyer at
Closing a waiver, executed by the State Street Tenant, pursuant to which such



14









 







Tenant waives
its right to terminate the SSB Office Lease on account of the Damage. If Buyer elects to
terminate this Agreement and Seller does not render such election null and void as herein
provided, Deposit Escrow Agent shall return the Deposit, and all interest thereon, to
Buyer, and neither party shall have any further liability to the other hereunder, except as
otherwise provided herein.




     (c) If any such Taking provides the State Street Tenant with the right to terminate the
SSB Office Lease or reduce its rents thereunder, then Buyer may terminate this Agreement by
giving written notice of such termination within ten (10) days after Seller’s notice of such
Taking; provided, however, that if Buyer elects to so terminate, Seller shall have the right
to render such election null and void by giving notice to Buyer, within ten (10) business
days after Seller’s receipt of Buyer’s notice of election to terminate, confirming that as a
condition to the performance of Buyer’s obligations hereunder, Seller shall deliver to Buyer
at Closing a waiver, executed by the State Street Tenant, pursuant to which such Tenant
waives its right to terminate the SSB Office Lease or reduce its rents, as the case may be,
on account of the Taking. If Buyer elects to terminate this Agreement and Seller does not
render such election null and void as herein provided, Deposit Escrow Agent shall return
the Deposit, and all interest thereon, to Buyer, and neither party shall have any further
liability to the other hereunder, except as otherwise provided herein.




     (d) If this Agreement is not terminated pursuant to subsections 10(b) or (c) above,
Seller may elect to (i) repair and restore the Real Property in a good and workmanlike
manner, in which event Seller may adjourn the Closing Date for such reasonable period of
time (but not to exceed 90 days) as may be necessary to effect such repair and restoration,
or (ii) assign to Buyer Seller’s rights to the proceeds of any awards, compensation or
insurance payable. Buyer shall remain obligated to perform this Agreement, and in the case
of damage or destruction covered by insurance, the Purchase Price shall be reduced by the
amount of the deductible, if any, under the insurance policy or policies covering the
Property.




11. CLOSING.




     (a) The closing of the transactions contemplated by this Agreement (the “Closing”)
shall be held at the offices of Bryan Cave LLP, 1290 Avenue of the Americas, New York, New
York 10104, at 10:00 a.m. (New York City time), on December 21, 2006 (said date, as the same
may be adjourned by Seller either pursuant to subsection (b) below or as otherwise provided
in this Agreement or by Buyer pursuant to subsection (b)), being herein called the
“Scheduled Closing Date”), TIME BEING OF THE ESSENCE with respect to the Seller’s and
Buyer’s obligations to close on the Scheduled Closing Date (as the same may be extended,
from time to time, pursuant to the terms hereof). The actual date on which the Closing
occurs is referred to herein as the “Closing Date.”




     (b) Notwithstanding anything to the contrary contained herein, (i) in addition to any
other rights which Seller may have under this Agreement to adjourn the Closing, Seller shall
have the right, exercisable from time to time upon written notice to Buyer



15









 







given on or prior
to the then Scheduled Closing Date, to adjourn the Closing to a business day specified in
such notice, provided that in no event may such adjournments be more than thirty (30) days
in the aggregate, and (ii) Buyer shall have the right, exercisable from time to time upon
written notice to Seller given on or prior to the then Scheduled Closing Date, to adjourn
the Closing to a business day specified in such notice, provided that in no event may such
adjournments be more ten (10) days in the aggregate. In the event Seller shall elect to
adjourn the then Scheduled Closing Date for more than ten (10) business days it shall
provide to Buyer at the Closing a credit in the amount of the cost Buyer incurs in extending
the Rate Lock Agreement (hereinafter defined) to the newly Scheduled Closing Date or in the
event this Agreement is terminated other than by reason of Buyer’s default Seller shall
promptly reimburse Buyer for such amount. Buyer shall upon Seller’s request promptly
provide to Seller the cost of the aforesaid extension. This provision shall survive the
Closing.




     (c) In the event the conditions precedent to Buyer’s obligation to Close (as set forth
in Section 9) are not satisfied (or waived by Buyer) on the originally Scheduled Closing
Date and the Seller does not elect to adjourn the Closing as provided above, then Buyer
shall have the one time right to adjourn the originally Scheduled Closing Date for a period
not to exceed thirty (30) days. This right shall be in addition to the ten (10) day right
of adjournment afforded Buyer under subsection (b) above, provided that if such right is
exercised then the thirty (30) day period in the preceding sentence shall be deemed reduced
to twenty (20) days.




12. PRORATIONS AND CHARGES.




     (a) The following are to be adjusted and prorated between Seller and Buyer as of 11:59
P.M. on the day preceding the Closing Date, based upon a 365 day year, and the net amount
thereof shall be, if such net amount is in Seller’s favor, paid to Seller at the Closing,
or, if such net amount is in Buyer’s favor, paid to Buyer at the Closing:




     (i) Real estate taxes shall be adjusted and prorated on the basis of the fiscal
year for which assessed. If the Closing shall occur before the tax rate or assessed
valuation is fixed for the Real Property, the apportionment of real estate taxes for
the Real Property shall be upon the basis of the tax rate for the preceding year
applied to the most recently applicable assessed valuation of the Real Property,
subject to further and final adjustment when the tax rate and/or assessed valuation
for the Real Property is fixed for the fiscal year in which the Closing occurs. In
the event that the Real Property or any part thereof shall be or shall have been
affected by an assessment or assessments, whether or not the same become payable in
annual installments, Seller shall, at the Closing, be responsible for any
installments due prior to the Closing and Buyer shall be responsible for any
installments due on or after the Closing.




     (ii) Except to the extent paid directly by the State Street Tenant pursuant to
the terms of the State Street Leases, with respect to water rates, water meter
charges and sewer rents and sewer charges (the “Water Charges”), if any,



16









 







Seller
shall endeavor to have the appropriate agencies read the meters for the Water
Charges (if applicable) on or prior to the Closing Date. Seller shall be responsible
for all charges applicable to the period prior to the Closing Date based on such
final meter readings, and Buyer shall be responsible for all charges thereafter. If
such final readings are not obtainable, then, until such time as the final readings
are obtained, all Water Charges for which final readings were not obtained shall be
pro rated as of the Closing Date based upon the per diem rate obtained by using the
last period and bills for such water and sewer usage that are available. Upon the
taking of a subsequent actual final reading after Closing, such apportionment shall
be adjusted to reflect the actual per diem rate for the billing period in which the
Closing Date falls, and Seller or Buyer, as the case may be, shall promptly deliver
to the other the amount determined to be due upon such adjustment. Unmetered Water
Charges shall be apportioned on the basis of the charges therefor for the same
period of the preceding calendar year, but applying the current rate thereto.




     (iii) Vault charges, if any, shall be adjusted and prorated on the basis of the
fiscal period for which assessed.




     (iv) Except to the extent paid directly by the State Street Tenant pursuant to
the terms of the State Street Leases, fuel, if any, on the basis of Seller’s last
cost therefor, including sales tax, as evidenced by a written statement of Seller’s
fuel oil supplier, which statement shall be conclusive as to quantity and cost.




     (v) Except to the extent paid directly by the State Street Tenant pursuant to
the terms of the State Street Leases, Seller shall use reasonable efforts to obtain
readings of meters measuring electricity, steam, gas and other utility consumption
at the Real Property for all periods through (and including) the date preceding the
Closing Date, but in no event prior to the date which is thirty (30) days prior to
the Closing Date, Seller shall pay and be responsible for, all bills rendered on the
basis of such readings. If such readings are not obtained for any metered utility,
then, at the Closing, apportionment shall be made on the basis of the most recent
period for which such readings are available. Upon the taking of subsequent actual
readings, there shall be a recalculations of the applicable utility charges, and
Seller or Buyer, as the case may be, shall promptly remit to the other party any
amounts to which such party shall be entitled by reason of such recalculation (with
Seller being obligated to pay all such utility charges pertaining to the period
prior to the Closing and Buyer being obligated to pay all such utility charges
pertaining to the period thereafter).




     (vi) Amounts payable under all Service Contracts assigned to Buyer at the
Closing.




     (vii) the amount of the reimbursement of “Assumed Service Costs”, as such term
is defined in Section 2.2 of the Second Amendment).



17









 






     (viii) Prepaid (x) fixed or so-called base rent payments (“Fixed Rents”), and
(y) reimbursements or payments in respect of operating expenses, real estate taxes,
and other charges (collectively, “Overage Rent”, together with Fixed Rents shall
hereinafter be referred to collectively as, “Rents”) payable pursuant to the State
Street Leases.




     If any items to be adjusted as set forth in this Section 12 are not determinable at the
Closing, the adjustment shall be made subsequent to the Closing when the charge is
determined. Any errors or omissions in computing adjustments at the Closing shall be
promptly corrected, provided that the party seeking to correct such error or omission shall
have notified the other party of such error or omission on or prior to the date that is six
(6) months following the Closing Date.




     (b) (i) If, on the Closing Date, there are any past due Fixed Rents owing by the State
Street Tenant, Buyer shall use its commercially reasonable efforts to collect the same.
Buyer shall not be obligated to institute legal actions or proceedings against any such
tenant to collect such past due Fixed Rents. Any Rents received directly or indirectly by
Seller or Buyer following the Closing which are the property of the other party, shall be
deemed held in trust and shall be paid to the other party within five (5) business days
following receipt thereof. Upon either party’s request from time to time, the other party
shall provide the requesting party with a certified accounting of all Rents received by it
following Closing.




           (ii) Any Fixed Rents received (net of Buyer’s reasonable costs of collection) after the
Closing from the State Street Tenant for the period prior to the
Closing shall be applied in the following order of priority: (A) first, to Fixed Rent
arrearages with respect to the month in which the Closing occurs (subject to apportionment
pursuant to the terms hereof), (B) second, to Seller for Fixed Rent arrearages for the month
immediately preceding the month in which the Closing occurs; (C) third, to Buyer, until
Fixed Rent for all current periods is paid in full, and (D) fourth after Fixed Rent then due
and payable for all post Closing periods are paid in full, to Seller in payment of Fixed
Rent for periods prior to the month immediately preceding the month in which the Closing
occurs.




           (iii) As to Overage Rent in respect of an accounting period that shall have expired
prior to the Closing, but which shall be paid after the Closing, Buyer agrees that it will
pay the entire amount over to Seller upon receipt thereof, less Buyer’s reasonable costs of
collection reasonably allocable thereto. Buyer agrees that it shall: (A) promptly render
bills for any Overage Rent in respect of an accounting period that shall have expired prior
to Closing but which shall be payable after the Closing, (B) bill the State Street Tenant
such Overage Rent attributable to an accounting period that shall have expired prior to the
Closing, on a monthly basis for a period of six consecutive months, and (C) use commercially
reasonable efforts in the collection of Overage Rent, provided, however, that Buyer shall
have no obligation to commence any legal actions or proceedings to collect any such Overage
Rents. Seller shall furnish to Buyer all information and documentation relating to the
period prior to the Closing that is reasonably necessary for the computation and billing of
such Overage Rent. Buyer shall



18









 







deliver to Seller, concurrently with the delivery to the
State Street Tenant, copies of all statements relating to Overage Rent for periods prior to
the Closing.




               (iv) Overage Rent in respect of the accounting period in which the Closing occurs shall
be apportioned between Seller and Buyer as of 11:59 P.M. of the day preceding the Closing
Date. Seller shall be entitled to receive the proportion of such Overage Rent (less a like
portion of any reasonable costs and expenses incurred in the collection of such Overage
Rent), that the portion of such accounting period prior to the Closing Date bears to the
entire such accounting period. Buyer shall be entitled to receive the proportion of such
Overage Rent (less a like portion of any reasonable costs and expenses incurred in the
collection of such Overage Rent) that the portion of such accounting period from and after
the Closing Date bears to the entire such accounting period.




               (v) To the extent that any portion of the Overage Rent is required to be paid monthly
or on another periodic basis, by the State Street Tenant on account of estimated amounts for
the current period, and at the end of each calendar year (or, if applicable, at the end of
each lease year or tax year, as the case may be), such estimated amounts are to be
recalculated based upon the actual sales, expenses, taxes and other relevant factors for
that calendar (lease or tax) year, with the appropriate adjustments being made with such
tenant, then such portion of the Overage Rent paid shall be prorated between Seller and
Buyer at the Closing, based on such estimated payments (i.e., with Seller entitled to retain
all monthly and other periodic installments of such amounts paid with respect to periods
prior to the calendar month or other relevant period
in which the Closing Date occurs, Seller to pay to Buyer at the Closing all monthly or other
relevant period installments of such amounts paid with respect to periods following the
calendar month or other relevant period in which the Closing occurs and Seller and Buyer
shall apportion all monthly installments of such amounts with respect to the calendar month
in which the Closing occurs) and at the time(s) of final calculation and collection from (or
refund to) the State Street Tenant of the amounts in reconciliation of actual Overage Rent
for a period for which estimated amounts have been prorated, there shall be a reproration
between Seller and Buyer, with the net credit resulting from such reproration being payable
to the appropriate party (i.e., to Seller if the recalculated amounts exceed the estimated
amounts and to Buyer if the recalculated amounts are less than the estimated amounts).




               (vi) Until such time as all amounts required to be paid to Seller by Buyer pursuant to
this Section shall have been paid in full, Seller may from time to time, but not more
frequently than once each calendar month, request that Buyer furnish Seller with a
reasonably detailed accounting of the collection of all Rent. Within ten (10) business days
of its receipt of such request, Buyer shall furnish Seller with such accounting. Seller
shall have the right from time to time following the Closing, on prior notice to Buyer, to
review Buyer’s records with respect to the Property to ascertain the accuracy of such
accountings.




     (c) To the extent that any portion of the reimbursement of Assumed Service Costs is
required to be paid monthly or on another periodic basis, by the Seller on



19









 







account of
estimated amounts for the current period, and at the end of each calendar year such
estimated amounts are to be recalculated based upon the Assumed Service Costs with
appropriate adjustments being made with the State Street Tenant, then Assumed Service Costs
shall be prorated between Seller and Buyer at the Closing, based on such estimated payments
and at the time(s) of final calculation and collection from (or payment to) the State Street
Tenant of the amounts in reconciliation of actual reimbursement of the Assumed Service Costs
for a period for which estimated amounts have been prorated, there shall be a reproration
between Seller and Buyer, with the net credit resulting from such reproration being payable
to the appropriate party.




     (d) Seller shall be responsible for the following costs and charges:




     (i) cost of any transfer taxes or deed stamps required to record the Deed;




     (ii) one-half (1/2) of the escrow fee of the Deposit Escrow Agent;




     (iii) Seller’s attorneys’ fees; and




     (iv) any other fees in connection with the consummation of the transactions
required by the terms of this Agreement to be paid by Seller and not expressly set
forth in this Section 12.




     (e) Buyer shall be responsible for the following costs and charges:




     (ix) cost of recording the Deed and such other instruments as Buyer or Buyer’s
title company may consider necessary or desirable to be recorded;




     (x) cost of Buyer’s title insurance policy and any endorsements thereto to
insure over any title defect;




     (xi) one-half (1/2) of the escrow fee of the Deposit Escrow Agent;




     (xii) Buyer’s attorneys’ fees; and




     (xiii) all other fees in connection with the consummation of the transactions
required to be paid by Buyer by the terms of this Agreement and not expressly set
forth in this Section 12.




     (f) The provisions of this Section 12 shall survive the Closing





13. INSTRUMENTS OF CONVEYANCE AND OTHER DOCUMENTS.




     (a) On or prior to the Closing Date, Seller shall fully and properly execute and
deposit with Closing Escrow Agent the following documents:




     (i) the Deed in the form of Schedule 13(a)(i), which is attached to and made a
part of this Agreement;



20









 






     (ii) a bill of sale (the “Bill of Sale”) in the form of Schedule 13(a)(ii),
which is attached to and made a part of this Agreement, conveying to Buyer good
title to the Personal Property free and clear of all liens and encumbrances;




     (iii) an assignment and assumption of the State Street Leases (the “Assignment
of Leases”), in the form of Schedule 13(a)(iii), which is attached to and made a
part of this Agreement, pursuant to which Seller assigns and Buyer assumes all of
Seller’s right, title, and interest as lessor under the State Street Leases;




     (iv) an assignment of the License Agreement, Service Contracts and the
Intangible Property (the “Assignment of License Agreement, Service Contracts and
Intangible Property”), in the form of Schedule 13(a)(iv), which is attached to and
made a part of this Agreement, pursuant to which Seller assigns and Buyer assumes
all of Seller’s right, title, and interest in and to the Service Contracts and the
Intangible Property;




     (v) a counterpart settlement statement (the “Settlement Statement”) setting
forth the Purchase Price and all amounts charged against Seller pursuant to Section
12 of this Agreement;




     (vi) an affidavit in the form of Schedule 13(a)(vi), which is attached to and
made a part of this Agreement, regarding the non-foreign status of Seller;




     (vii) a closing certificate (the “Seller’s Closing Certificate”) in the form of
Schedule 13(a)(vii), which is attached to and made a part of this Agreement, stating
that, to the actual knowledge of Seller, there is no default under the covenants,
representations and warranties of Seller contained in this Agreement and, in
addition, that all such representations and warranties are true and correct in all
material respects as of the Closing Date as if made on and as of the Closing Date
(or specifying in reasonable detail any defaults or exceptions that may then exist,
provided that Seller shall not take any action that is reasonably likely to result
in any such default or exception);




     (viii) a letter to the State Street Tenant stating that the Property has been
conveyed to Buyer as of the Closing Date and advising such tenant that all future
payments of rent and all other future correspondence regarding the Property should
be delivered to Buyer; and




     (ix) such customary affidavits, evidence and documents as may be reasonably
required by Buyer’s title company in order to issue so-called owner’s and lender’s
title insurance policies insuring Buyer’s title to the Property, as relate to (i)
mechanics’ or materialmen’s liens; (ii) parties in possession; and (iii) the status
and capacity of Seller and the authority of the person or persons who are executing
the various documents on behalf of Seller in connection with the sale of the
Property; provided in no event shall Seller be required to deliver any instrument
that shall impose liability upon it or require Seller to undertake any



21









 







obligations
or make any representations not otherwise provided for in this Agreement.




     (b) On or prior to the Closing Date, Buyer shall fully execute and deposit with Closing
Escrow Agent the following documents and funds:




     (i) the Purchase Price, subject to the closing adjustments contemplated hereby
and after a credit for the Deposit and any sums advanced by Buyer to purchase the
Defeasance Collateral as provided in Section 5 hereof;




     (ii) such evidence or documents as may reasonably be required by Buyer’s title
company evidencing the status and capacity of Buyer and the authority of the person
or persons who are executing the various documents on behalf of Buyer in connection
with the purchase of the Property;




     (iii) a counterpart Assignment of Leases;




     (iv) a counterpart Assignment of Service Contracts and Intangible Property;




     (v) a certificate (“Buyer’s Closing Certificate”) in the form of Schedule
13(b)(v), which is attached to and made a part of this Agreement, stating that there
is no default under the covenants, representations and warranties of Buyer contained
in this Agreement and, in addition, that, to the actual knowledge of Buyer, all such
representations and warranties are true and correct in all material respects as of
the Closing Date as if made on and as of the Closing Date (or specifying in
reasonable detail any defaults or exceptions that may then exist, provided that
Buyer shall not take any action that is reasonably likely to result in any such
default or exception); and




     (vi) a counterpart Settlement Statement setting forth the Purchase Price and
all amounts applied on behalf of or charged against Buyer pursuant to Section 12 of
this Agreement.




14. DELIVERY AND PAYMENT.




     Upon consummation of the transactions contemplated in this Agreement, Closing Escrow
Agent shall disburse funds and documents as follows:




     (a) To Seller:




     (i) the Purchase Price, plus or minus amounts charged against or credited to
Seller hereunder after a credit for the Deposit and any sums advanced



22









 







by Buyer to
purchase the Defeasance Collateral as provided in Section 5 hereof; and




     (ii) executed originals of the documents and other deliveries listed in Section
13(b) above.




     (b) To Buyer:




     (i) the Deed, the Assignment of Leases and title clearing documents (each of
which Buyer may instruct the Closing Escrow Agent to record contemporaneously with
the Closing pursuant to usual and customary escrow instructions for commercial real
estate transactions in Boston, Massachusetts);




     (ii) executed originals of the documents and other deliveries listed in Section
13(a) above, except as provided in (i) above; and




     (iii) the balance, if any, in the escrow account to the credit of Buyer by
check payable to Buyer.




Immediately after Closing, Seller shall deliver, or cause to be delivered, to Buyer, all to
the extent in Seller’s possession, copies of the executed State Street Leases and Service
Contracts, plans and specifications for the Improvements, building permits, certificates of
occupancy, and such other certificates, licenses, and permits as may relate to the operation
of the Property, and the originals or photocopies of all books, accounts, and records
relating to the Property.




15. BREACH.




     (a) If Buyer shall breach the terms of, or default under, this Agreement, as Seller’s
sole remedy the Deposit and all interest thereon shall be retained by Seller as liquidated
damages, and both parties shall be relieved of and released from any further liability
hereunder except for those obligations which specifically survive termination. Seller and
Buyer acknowledge and agree that (a) it would be extremely difficult to accurately determine
the amount of damages suffered by Seller as a result of Buyer’s default hereunder; (b) the
Deposit and such interest is a fair and reasonable amount to be retained by Seller as agreed
and liquidated damages for Buyer’s default under this Agreement; and (c) retention by Seller
of the Deposit and the interest thereon upon Buyer’s default hereunder shall not constitute
a penalty or a forfeiture.




     (b) If Seller shall refuse or fail to convey the Property to Buyer in violation of
Seller’s obligations hereunder for any reason other than a default by Buyer under this
Agreement or otherwise be in breach of any other covenant herein contained, Buyer shall
elect as its sole remedy hereunder either (a) to terminate the Agreement and recover the
Deposit and the interest thereon , or (b) to seek specific performance of Seller’s
obligation to convey the Property pursuant to this Agreement, provided that in no event
shall Seller by obligated to undertake any of the following: (i) change the condition of
the Property or restore the same after fire or casualty; (ii) expend money or post a bond to
remove or



23









 







insure over a title defect or encumbrance or to correct any matter shown on a
survey of the Property; or (iii) secure any permit, approval, estoppel, waiver or consent
with respect to the Property or Seller’s conveyance thereof. Notwithstanding the foregoing,
in the event the breach by Seller is a willful and intentional breach of a material
obligation, the Buyer if it elects to terminate the Agreement and receive the Deposit and
the interest thereon the Buyer may also seek to collect its actual (but not consequential or
punitive) damages, but in no event in an amount to exceed Twenty Million ($20,000,000)
Dollars in the aggregate.




16. NO OUTSIDE REPRESENTATIONS/AS-IS SALE/SURVIVING OBLIGATIONS.




     (a) This Agreement, including the Schedules attached hereto and incorporated herein,
contains all of the terms and conditions agreed upon, it being understood that there are no
outside representations or oral agreements. Any modification of this Agreement shall be in
writing and shall be signed by Seller and Buyer.




     (b) The Property is being sold in an “AS IS, WHERE IS” condition and “WITH ALL FAULTS”,
as of the date hereof, subject to reasonable wear and tear, repairs that are the obligation
of the State Street Tenant and the condition the Property may be in under provisions of
Section 10 of this Agreement (collectively, the “As Is Condition”). Except for Seller’s
representations as set forth in this Agreement and any instruments delivered by Seller at
Closing, no representations or warranties, express, implied or arising by operation of law,
have been made or are made and no responsibility has been or is assumed by Seller or by any
partner, officer, person, firm, agent, attorney, or representative acting or purporting to
act on behalf of Seller as to the condition or repair of the Property or the value, expense
of operation, or income potential thereof or as to any other fact or condition which has or
might affect the Property of the condition, repair, value, expense of operation or income
potential of the Property or any portion thereof. The parties agree that all understandings
and agreements heretofore made between them or their respective agents or representatives
are merged in this Agreement and the schedules and exhibits hereto annexed, which, along
with any confidentiality agreements or access agreements that have been or may be entered
into between the parties, alone fully and completely express their agreement, and that this
Agreement has been entered into after full investigation, or with the parties satisfied with
the opportunity afforded for investigation, neither party relying upon any statement or
representation by the other unless such statement or representation is specifically embodied
in this Agreement or such schedules or exhibits. Seller makes no representations or
warranties as to whether the Property contains asbestos or any hazardous materials or
harmful or toxic substances, or pertaining to the extent, location or nature of same, if
any. Further, to the extent that Seller has provided to Buyer access or use of a physical
or electronic data room or internet site (any such form of access or use referred to as
“Data Room”) or information from any inspection, engineering or environmental reports
concerning asbestos or any hazardous materials or harmful or toxic substances, Seller makes
no representations or warranties with respect to the accuracy or completeness, methodology
of preparation or otherwise concerning the contents of such Data Room or reports, except the



24









 







representations set forth in Section 8 (a) (xii) and (xiii). Buyer acknowledges that Seller
has requested that Buyer inspect the Property fully and carefully and investigate all
matters relevant thereto and that Buyer rely solely upon the results of Buyer’s own
inspections or other information obtained or otherwise available to Buyer, rather than any
information that may have been provided by Seller to Buyer. Buyer expressly understands and
acknowledges that it is possible that unknown liabilities may exist with respect to the
Property and Buyer explicitly took that possibility into account in determining and agreeing
to the Purchase Price.




     (c) Buyer waives and releases Seller from any present or future claims arising from or
relating to the presence or alleged presence of asbestos or any hazardous materials or
harmful or toxic substances in, on, under or about the Property, prior to, on or after the
date hereof, including without limitation any claims under or on account of (i) the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, Massachusetts
Oil and Hazardous Materials Release Prevention and Response Act (as amended) (M.G.L. c.21E
et seq.), Massachusetts Hazardous Waste Management Act (as amended) (M.G.L. c.21C et seq.);
Massachusetts Wetlands Protection Act (as amended)
(M.G.L. c.131, §40 et seq.); Massachusetts Clean Waters Act (as amended) (M.G.L. c.21,
§§26-53 et seq.); Massachusetts Clean Air Act (as amended) (M.G.L. c.111, §142 et seq.); and
Massachusetts Environmental Policy Act (as amended) (M.G.L. c.30, §61 et seq.) as the same
may have been or may be amended from time to time, and similar statutes, and any regulations
promulgated thereunder, (ii) any other federal, state or local law, ordinance, rule or
regulation, now or hereafter in effect, that deals with or otherwise in any manner relates
to, environmental matters of any kind, (iii) this Agreement, or (iv) the common law. The
terms and provisions of this paragraph shall survive Closing hereunder or termination of
this Agreement.




     (d) Seller and Buyer agree that Seller shall, at its sole cost and expense, indemnify
and defend Buyer against the claim of 99 Bedford Corporation disclosed in Schedule 8(a)(iv).
Buyer agrees to reasonably cooperate therewith.




     (e) Buyer acknowledges that Seller has advised Buyer that the State Street Tenant is
conducting an audit of the State Street Tenant’s Rent billings for the 2004 and 2005
calendar years. Seller and Buyer agree that Seller shall be responsible for any sums that
may be due to State Street Tenant as a result of such audits or any settlement in connection
therewith (it being understood that the foregoing is not intended, nor shall it be deemed to
mean, that Seller believes that any sums shall be due to State Street Tenant in connection
with such audit.) In the event any sum is determined to be due to the State Street Tenant
by reason of such audits and the State Street Tenant sets off such sum against the rental
due Buyer, then Seller shall pay that amount to Buyer. Seller and Buyer agree that Seller
shall have the right to control such audits and that Buyer shall reasonably cooperate with
Seller, at Seller’s expense, in connection therewith, provided that Seller shall not settle
without Buyer’s consent (which shall not be unreasonably withheld) any such audit dispute
with the State Street Tenant if the effect of such settlement would adversely affect the
Overage Rents that Buyer is entitled to under the State Street Leases. In the event that
Buyer so withholds its consent, Seller shall have the



25









 







right to require that Buyer assume the
obligation to contest the audit(s) in question at its sole cost and expense and Seller shall
thereupon become liable to reimburse the Buyer for an amount equal to the lesser of (i) the
amount of any final judgment or settlement of the audit, or (ii) the amount that Seller
wished to pay the State Street Tenant to so settle the audit.




     (f) (i) If any tax reduction proceedings in respect of the Real Property, relating to
any fiscal years ending prior to the fiscal year in which the Closing occurs, are pending at
the time of the Closing, Seller reserves and shall have the right to continue to prosecute
and/or settle the same. If any tax reduction proceedings in respect of the Real Property,
relating to the fiscal year in which the Closing occurs, are pending at the time of Closing,
then Seller reserves and shall have the right to continue to prosecute and/or settle the
same; provided, however, that Seller shall not settle any such proceeding
without Buyer’s prior written consent, which consent shall not be unreasonably withheld or
delayed. Buyer shall reasonably cooperate with Seller in connection with the prosecution of
any such tax reduction proceedings.




          (ii) Any refunds or savings in the payment of taxes resulting from such tax reduction
proceedings applicable to the period prior to the date of the Closing shall belong to and be
the property of Seller, and any refunds or savings in the payment of taxes applicable to the
period from and after the date of the Closing shall belong to and be the property of Buyer.
All attorneys’ fees and other expenses incurred in obtaining such refunds or savings shall
be apportioned between Seller and Buyer in proportion to the gross amount of such refunds or
savings payable to Seller and Buyer, respectively, except that Buyer liability for such fees
and other expenses shall not exceed the refund or savings so obtained. Notwithstanding the
foregoing, in the event that the State Street Tenant is entitled to a portion or all of such
refunds pursuant to the State Street Leases, the amount to which such tenant is entitled to
shall be remitted to it.




     (g) The provisions of this Section 16 shall survive the Closing and delivery of the
Deed and shall not be merged thereby.




17. SURVIVABILITY.



     Except for the rights and obligations of Seller and Buyer in Sections 4, 8, 12, 16, 19, 22 and
29 of this Agreement and the obligations of Buyer in Section 5 hereof, which by their express terms
shall survive, none of the rights and obligations of Buyer and Seller shall survive the Closing or
the termination of this Agreement.




18. NOTICES.



     All notices, requests, approvals, consents and other communications required to be given or
delivered under this Agreement shall be in writing and shall be deemed validly given (a)
immediately upon hand delivery, (b) one (1) day following deposit with a courier or express service
guaranteeing overnight delivery, (c) two (2) postal delivery days after deposit in the U.S. mails
by certified mail, return receipt requested, or (d) immediately upon the telephonically confirmed
receipt of a facsimile transmission, addressed as follows:



26









 





	 	 	 	 	 
	 

	 	If to Seller:
	 	First States Investors 228, LLC
	 

	 	 	 	c/o American Financial Realty Trust
	 

	 	 	 	610 Old York Rd.
	 

	 	 	 	Suite 300
	 

	 	 	 	Jenkintown, PA 19046
	 

	 	 	 	Attn: Edward J. Matey, Jr.
	 

	 	 	 	General Counsel
	 

	 	 	 	Telephone: 215-887-2280
	 

	 	 	 	Telecopier: 215-572-1596
	 
	 	 	 	 
	 

	 	with copies to:
	 	Bryan Cave LLP
	 

	 	 	 	1290 Avenue of the Americas
	 

	 	 	 	New York, NY 10104
	 

	 	 	 	Attn: Barry C. Ross, Esquire
	 

	 	 	 	Telephone: (212) 541-2255
	 

	 	 	 	Telecopier: (212) 541-1455
	 
	 	 	 	 
	 

	 	If to Buyer:
	 	FPG DF Lincoln Street, LLC
	 

	 	 	 	184 Kent Avenue, 5th Floor
	 

	 	 	 	Brooklyn, New York 11211
	 

	 	 	 	Attn: Jonathan Landau
	 

	 	 	 	Telephone: (718) 907-7703
	 

	 	 	 	Telecopier: (718) 907 8703
	 
	 	 	 	 
	 

	 	with a copy to:
	 	Bloodworth Carroll & Banowsky, P.C.
	 

	 	 	 	12221 Merit Drive, Suite 1680
	 

	 	 	 	Dallas, Texas, 75251
	 

	 	 	 	Attn: Thomas Bloodworth
	 

	 	 	 	Telephone: (214) 234-2720
	 

	 	 	 	Telecopier(214) 234-2727





or to such other person or address as Seller or Buyer shall have given by notice as herein
provided.





19. BROKER’S COMMISSION.



     Except for Eastdil/Secured, L.L.C. (“Eastdil”) whose fees shall be paid pursuant to a certain
agreement between Seller and Eastdil, Seller and Buyer each represent and warrant to the other that
the warranting party has had no dealing with any other dealer, real estate agent, or broker so as
to entitle such other dealer, agent, or broker to receive any commission or fee in connection with
sale of the Property to Buyer. If for any reason any such commission or fee shall become due, the
party dealing with such dealer, agent, or broker shall pay any such commission or fee and shall
indemnify, defend, and save the other party harmless from and against any and all claims for any
such commission or fee and from any attorneys’ fees and



27









 







litigation or other expenses relating to
any such claim. The provisions of this Section 19 shall survive the Closing or the termination of
this Agreement.




20. BINDING EFFECT.



     This Agreement shall benefit and bind the parties and the heirs, legal representatives,
successors, and assigns of each of them.




21. ASSIGNMENT.




     (a) This Agreement may not be assigned by Buyer without the prior written consent of
Seller which Seller may withhold in its sole and absolute discretion. Except as hereinafter
set forth, a transfer, sale or assignment of any direct or indirect interest in Buyer shall
constitute an assignment of this Agreement. Any assignment or attempted assignment shall be
void if made without the prior written consent of Seller. Notwithstanding the foregoing,
Buyer may, without the consent of Seller (i) admit one or more members to its limited
liability company, provided that following such admission the Buyer remains under the
control of one or more of those persons or entities that control Buyer on the date hereof
(the “Control Group”) and one or more of those persons or entities in the Control Group,
directly or indirectly, owns twenty (20%) percent or more of all of the membership interests
in Buyer, (ii) effective upon the Closing, assign this Agreement to one or more persons or
entities that shall take title as tenants-in-common, provided that each of such persons or
entities executes an agreement in reasonably satisfactory form assuming the obligations
under this Agreement, and that one or more members of the Control Group owns twenty (20%)
percent or more of the equity and other beneficial interests, on an aggregate basis, in such
assignees and control assignees having such twenty (20%) percent interest, and (iii)
effective upon the Closing, assign this Agreement to an entity, provided that such entity
executes an agreement in reasonably satisfactory form assuming the obligations under this
Agreement, and that one or more members of the Control Group control such entity and own
twenty (20%) percent or more of the equity and other beneficial interests therein. Buyer
shall provide to Seller at Closing an instrument certifying that the provisions of this
Section have been complied with. For purposes of this Section 21, the term “control” means
the possession, directly or indirectly, of the power to direct or cause the direction of the
management and policies of a Person, whether through ownership of voting stock, by contract,
or otherwise.




     (b) Buyer agrees that in the event it shall transfer, convey or otherwise dispose of
all or any portion of the Real Property on or before the 180th day following the
Closing Date that it shall pay to Seller a sum equal to 70% of the “Net Proceeds”. The term
Net Proceeds shall mean the amount by which the gross purchase price of the Real Property
(or portion thereof) exceeds the aggregate of (i) the Purchase Price (or proportionate
amount thereof if less than all the Real Property is transferred), and (ii) the reasonable
and customary costs of selling similar property in Boston, MA. The parties agree that (x)
transfers, sales or assignments resulting in there being transferred more



28









 







than eighty (80%)
percent of all of the equity and other beneficial interests in Buyer shall be deemed a
transfer of the Real Property. This provision shall survive the Closing.




22. SELLER’S LIMITED LIABILITY.



     It is hereby expressly agreed that any liability of Seller arising hereunder, for any reason
whatsoever, shall be limited to Seller’s interest in and to the Property and the proceeds thereof.
It is further hereby expressly agreed that in no event shall any member, manager, officer,
director, employee, agent or representative of Seller have any personal liability in connection
with this Agreement or the transaction envisioned herein. The provisions of this Section 22 shall
survive the Closing or the termination of this Agreement.




23. TAX FREE EXCHANGE.



     Seller and Buyer acknowledge and agree that either of them may elect to assign its interest in
this Agreement to an exchange facilitator for the purpose of completing an exchange (the
“Exchange”) which will qualify for non-recognition of gain under Section 1031 of the Internal
Revenue Code, and the Treasury Regulations promulgated thereunder. If any party so elects, the
other party shall cooperate in effecting the Exchange and in implementing any such assignment
provided that such cooperation shall not entail any additional expense (other than nominal amounts)
to the non-electing party or cause the non-electing party to be exposed to any liability or loss of
rights or benefits contemplated under this Agreement. No such assignment shall relieve any party
of its obligations hereunder, nor shall the consummation of an Exchange be a condition to the
performance of such party’s obligations hereunder. In addition, nothing contained in this Section
23 is intended to confer any adjournment rights that are not otherwise available under this
Agreement.




24. SECTION HEADINGS.



     All section headings and other titles and captions used in this Agreement are for convenience
only, do not form a substantive part of this Agreement, and shall not restrict or enlarge any
substantive provisions of this Agreement.




25. PRONOUNS.



     All pronouns and any variations thereof shall be deemed to refer to the masculine, feminine,
neuter, singular, or plural, as the context and the identity of the person or persons may require.




26. AGREEMENT IN COUNTERPARTS.



     This Agreement may be executed in counterparts and all such counterparts shall constitute one
agreement binding on all the parties, notwithstanding that all the parties are not signatories to
the same counterpart.



29









 






27. GOVERNING LAW.



     This Agreement shall be governed by the laws of the Commonwealth of Massachusetts.




28. TIME OF THE ESSENCE; FAILURE TO ENFORCE NOT A WAIVER.



     Time is of the essence of this Agreement. Except as may be expressly provided in this
Agreement, failure by Seller or Buyer to enforce any right shall not constitute a waiver thereof.




29. SEVERABILITY.



     If any provision in this Agreement, or its application to any person or circumstance, is held
to be invalid or unenforceable to any extent, that holding shall not affect the remainder of this
Agreement or the application of that provision to persons or circumstances other than that to which
it was held invalid or unenforceable.




30. CONFIDENTIALITY/NO PUBLIC DISCLOSURE.




     (a) The terms and provisions of that certain Confidentiality Agreement dated as of
October 22, 2006 executed by Buyer are hereby incorporated by reference, as if the same were
fully set forth herein.




     (b) All press releases or other dissemination of information to the media or responses
to requests from the media for information relating to the transaction contemplated herein
which Buyer wishes to issue or provide shall be subject to the prior written approval of
Seller; provided that, following Closing, Seller’s approval shall not be unreasonably
withheld or delayed.




     (c) Seller shall have the right to issue one or more press releases, file Form 8-K
reporting this transaction with the SEC (it Seller determines such filing is required) or
from disseminating other information to the media or responses to requests from the media
for information relating to this transaction.




     (d) The provisions of this Section 30 shall survive the Closing or the termination of
this Agreement.




31. NO PARTNERSHIP.



     Nothing contained in this Agreement shall be construed to create a partnership or joint
venture between the parties or their successors in interest.




32. INTENTIONALLY OMITTED.




33. NO RECORDATION.



30









 





     Neither this Agreement nor any memorandum or short form thereof may be recorded by Buyer. A
violation of this prohibition shall constitute a material breach by Buyer of this Agreement.




34. RIGHT OF FIRST REFUSAL.




     (a) Buyer recognizes that the Real Property is subject to a certain right of first
refusal (the “Right of First Refusal”) benefiting IPC Realty II, LLC
(“IPC”), pursuant to the terms of that certain First Amended and Restated Limited
Liability Company Agreement of First States Investors 228 Holdings A, LLC. (the “First
States Agreement”).




     (b) (i) On the date hereof Seller shall deliver to Federal Express for delivery to IPC
a notice substantially in the form set forth on Exhibit A annexed hereto and made a
part hereof (the “ROFR Offer Notice).




     (ii) If (i) on or before the expiration of the time period afforded IPC to accept the
offer set forth in ROFR Offer Notice (which Seller has advised Buyer is seven (7) business
days, plus the time necessary for the receipt of any acceptance (which in no event, however,
shall be deemed to be more than four (4) business days)) following IPC’s receipt of the ROFR
Offer Notice, IPC shall not have accepted the offer set forth in the ROFR Offer Notice, or
(ii) at any time IPC shall in writing reject the offer set forth in the ROFR Offer Notice or
otherwise waive in writing the Right of First Refusal, then, in any such event (each such
event being referred to herein as a “ROFR Termination Event”), the condition
precedent to Closing that is set forth in Section 9 (c) above shall be deemed satisfied and
the parties hereto shall proceed to the Closing hereunder. Seller shall promptly deliver to
Buyer copies of any such instruments of waiver and/or termination demonstrating the
occurrence of a ROFR Termination Event.




     (iii) If IPC shall accept the offer set forth in the ROFR Offer Notice, then, Seller
shall promptly deliver to Buyer written notice or other evidence of such acceptance (the
“ROFR Acceptance Notice”), accompanied by Seller’s good and sufficient check made
payable to Buyer in the sum of (x) $3,000,000, in the event the ROFR Acceptance Notice is
delivered on or before 5:00 P.M. EST on November 3, 2006, or (x) $6,000,000.00, in the event
the ROFR Acceptance Notice is delivered after 5:00 P.M. EST on November 3, 2006 (in each
case such sum being referred to herein as the “Breakup Fee”). Upon delivery to
Buyer of the ROFR Acceptance Notice and the Breakup Fee, (A) this Agreement shall be deemed
terminated, (B) the Deposit (together with any interest earned thereon) shall be returned to
Buyer, and (C) the parties hereto shall have no further obligation each to the other except
for those obligations which expressly survive the termination of this Agreement (it
being understood that the return of the Deposit and payment of the Breakup
Fee to Buyer shall be deemed full and complete compensation to Buyer for the failure of the
transactions herein contemplated to be consummated as a result of IPC’s acceptance of ROFR
Offer Notice).




     (c) If an ROFR Termination Event shall occur, then on or before the seventh
(7th) business day following same Buyer shall deliver to Seller a true an
complete copy of



31









 







a Rate Lock Agreement. A Rate Lock Agreement shall mean an agreement that
is in full force and effect between Buyer and an institutional lender from which it is
seeking financing for this transaction, which agreement shall (w) lock the rate of interest
on that amount of proposed loan or portion of the proposed loan that Buyer is seeking (which
amount shall not be less than $700,000,000, (x) have a term that will not expire prior to
December 31, 2006, and (y) shall be extendable by Buyer for one or more periods not to
exceed 30 days in the aggregate and at a cost not to exceed that which is customary for such
extension, and (z) shall otherwise be on terms that are customary for such agreements.




     (d) Seller shall, from and after delivery to IPC of the ROFR Offer Notice, continue to
have the right to deal with and carry on discussions with IPC.




     THIRD PARTY BENEFICIARY.




     Nothing in this Agreement is intended or shall be construed to confer upon or to give
to any person, firm or corporation (including, without limitation, IPC) other than the
parties hereto any right, remedy or claim under or by reason of this Agreement. All terms
and conditions of this Agreement shall be for the sole and exclusive benefit of the parties
hereto. No party, other than the named Seller or Buyer shall be liable hereunder as a
disclosed or undisclosed principal.




36. GUARANTY.




     First States Group, L.P. has joined in this Agreement soley to evidence its agreement
that is shall guarantee the obligations of Seller that survive the Closing,
including the obligation to pay any damages that the Seller may be liable for. This
guaranty shall not be limited by the provisions of Section 22 hereof.



32









 





     IN WITNESS WHEREOF, the parties have executed this Agreement under seal as of the date first
set forth at the beginning of this Agreement.



	 	 	 	 	 	 	 	 	 
	 	 	SELLER:	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	First States Investors 228, LLC	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	Name: Glenn Blumenthal	 	 
	 	 	 	 	Title: Vice President	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BUYER:	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	FPG DF Lincoln Street, LLC	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Guarantor:	 	 
	 	 	First States Group, LP,	 	 
	 	 	By: First States Group, LLC, its general partner	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	Title:	 	 	 	 






33









 





LIST OF SCHEDULES




	 	 	 
	Schedule 1(a)

	 	Legal Description of the Land
	Schedule 1(d)

	 	List of Leases
	Schedule 1(e)

	 	List of Service Contracts
	Schedule 3

	 	Deposit Escrow Agreement
	Schedule 4(a)

	 	Title Commitment and Survey
	Schedule 8(a)(iv)

	 	Litigation
	Schedule 8(a)(vi)(B)

	 	State Street Tenant Defaults
	Schedule 8(a)(vi)(C)

	 	State Street Tenant Claims
	Schedule 8(a)(vi)(E)

	 	RoFo Notice
	Schedule 8(a)(vii)(B)

	 	Defaults Under Service Contracts
	Schedule 8(a)(xi)

	 	State Street Lease Guarantees
	Schedule 13(a)(i)

	 	Form of Deed
	Schedule 13(a)(ii)

	 	Form of Bill of Sale
	Schedule 13(a)(iii)

	 	Form of Assignment of Leases
	Schedule 13(a)(iv)

	 	Form of Assignment of License Agreements, Service
Contracts and Intangible Property
	Schedule 13(a)(vi)

	 	Form of Affidavit of Non-Foreign Status
	Schedule 13(a)(vii)

	 	Form of Seller’s Closing Certificate
	Schedule 13(b)(v)

	 	Form of Buyer’s Closing Certificate
	Exhibit A

	 	Form of ROFR Offer Notice
	Exhibit B

	 	Form of Operating Report






1









 






SCHEDULE 1(a)


Legal Description of the Land




See Following Pages




2









 








SCHEDULE 1(d)




List of Leases





	1.	 	Lease dated May 9, 2001, by and between Kingston Bedford Joint Venture LLC, as
Landlord, and SSB Realty LLC, as Tenant, as amended by First Amendment to Lease dated
August 15, 2003, by and between Kingston Bedford Joint Venture LLC, as Landlord, and SSB
Realty LLC, as Tenant, as amended by Second Amendment to Lease dated February 13, 2004, by
and between First States Investors 228 LLC, as Landlord, and SSB Realty LLC, as Tenant, as
amended by Third Amendment To Lease dated December 22, 2004, by and between First States
Investors 228 LLC, as Landlord, and SSB Realty LLC, as Tenant.






	2.	 	Garage Lease dated May ___, 2004, by and between First States Investors 228 LLC, as
Landlord, and SSB Realty LLC, as Tenant.




3









 











SCHEDULE 1(e)




List of Service Contracts




None




4









 





SCHEDULE 3



Deposit Escrow Agreement






Escrow Agreement




DEPOSIT ESCROW AGREEMENT



THIS DEPOSIT ESCROW AGREEMENT, entered into as of ___, 2006 by and among First States
Investors 228, LLC, a Delaware limited liability company
(“Seller”), ___ (“Buyer”)
and Chicago Title Insurance Company (the “Escrow Agent”).




     WHEREAS, Seller and Buyer have entered into an Agreement of Purchase and Sale dated the date
hereof (the “P&S”) for the transfer of certain property located at One Lincoln Street, Boston,
Massachusetts from Seller to Buyer;



     WHEREAS, Seller and Buyer desire to have Escrow Agent act as an escrow agent with respect to
the Deposit under such P&S;



     NOW, THEREFORE, in consideration of the foregoing, and of the mutual covenants and agreements
hereinafter set forth, the parties, intending to be bound legally, agree as follows:


1. Buyer shall pursuant to the terms of the P&S deliver to the Escrow Agent by wire transfer the
deposit described in the P&S in the amount of ___ ($___) to be held in
accordance with the terms and conditions of this Agreement (the Deposit so deposited, with all
interest thereon, shall be hereinafter referred to as the “Deposit”). Buyer hereby advises Seller
and Escrow Agent that Buyer’s Employer Identification is
___ so that Escrow Agent may establish
an interest bearing escrow account.



2. Upon delivery of the Deposit, the Escrow Agent agrees to acknowledge receipt of same
and agrees to hold and keep same in accordance with terms and conditions hereof, and to
deliver the Deposit upon the occurrence of the conditions hereinafter set forth. The
Deposit shall be invested at either Citizen Bank, Wilmington Trust or Bank of America.



3. The Escrow Agent shall deliver the Deposit in accordance with the following terms and
conditions:




     a. The Deposit to Seller, to be credited toward the Purchase Price, upon completion of the
Closing in accordance with the P&S;



     b. The Deposit to Seller, after receipt of Seller’s written demand in which Seller certifies
that Buyer has defaulted under the P&S and Seller is thereby entitled to receive the Deposit
pursuant to the P&S; but Escrow Agent shall not honor Seller’s written demand until more than ten
(10) Business Days (as hereinafter defined) after Escrow Agent has sent a copy of Seller’s written
demand to Buyer in accordance with Paragraph 14 hereof, nor thereafter if Escrow Agent receives a
Notice of Objection (as hereinafter defined) from Buyer within such ten (10) Business Day period;
or The Deposit to Buyer, after receipt of Buyer’s written demand in



5









 







which Buyer certifies either (i) that Seller has defaulted under the P&S, and that the Buyer is
entitled to the return of the Deposit, or (ii) the P&S has otherwise been terminated or canceled in
accordance with the terms thereof, and Buyer is thereby entitled to receive the Deposit; but Escrow
Agent shall not honor Buyer’s written demand until more than ten (10) Business Days after Escrow
Agent has send a copy of Buyer’s written demand to Seller in accordance with Paragraph 14 hereof,
nor thereafter if Escrow Agent receives a Notice of Objection (hereinafter defined) from Seller
within such ten (10) Business Day period;



     c. Upon delivery of the entire Deposit, Escrow Agent shall be relieved of all liability
hereunder.


4. Upon receipt of written demand in accordance with the terms of paragraph 3 (b), the Escrow Agent
shall send a copy of such written demand to the other party. Within ten (10) Business Days after
the date of sending such copy, but not thereafter, the other party may object to delivery of the
Deposit to the other party by giving written notice of objection (a “Notice of Objection”) to
Escrow Agent. After receiving a Notice of Objection, Escrow Agent shall send a copy of such Notice
of Objection to the party who filed the written demand; and thereafter, in its sole and absolute
discretion, Escrow Agent may elect:




     a. to continue to hold the Deposit or any portion thereof until Escrow Agent receives a
written agreement of Buyer and Seller directing the disbursement of the Deposit in dispute, in
which event Escrow Agent shall disburse such Deposit in accordance with such agreement; and/or



     b. to take any and all such actions as Escrow Agent deems necessary or desirable, in its sole
and absolute discretion, to discharge and terminate its duties under, this Escrow Agreement,
including (but not limited to) depositing the Deposit or any remaining portion thereof into any
court of competent jurisdiction and the bringing of any action of interpleader or any other
proceeding; and/or in the event of any litigation between Seller and Buyer relating to the
disposition of the Deposit, to deposit the Deposit or any remaining portion thereof with the clerk
of the court in which such litigation is pending;


5. If Escrow Agent is uncertain for any reason whatsoever as to its duties or rights hereunder (and
whether or not the Escrow Agent has received any written demand under Paragraph 3 or Notice of
Objection under Paragraph 4), notwithstanding anything to the contrary herein, Escrow Agent may
hold the Deposit pursuant to the terms hereof and may decline to take any other action whatsoever.
In the event the Deposit is deposited in a court by Escrow Agent pursuant to Paragraphs 4 (b),
Escrow Agent shall be entitled to rely upon the decision of such court. In the event of any
dispute whatsoever among the parties with respect to the disposition of the Deposit or any
remaining portion thereof, Buyer and Seller shall pay the attorneys’ fees and costs incurred by
Escrow Agent (which said parties shall share equally, but for which such parties shall be jointly
and severally liable) for any litigation in which Escrow Agent is named as, or becomes, a party.



6. The Escrow Agent undertakes to perform only those duties which are expressly set forth in this
Agreement and acknowledges that these duties are purely ministerial in nature. The


6









 






Escrow Agent shall be entitled to receive reimbursement as Escrow Agent of documented reasonable
attorneys’ fees and other documented out-of-pocket expenses incurred by it in the performance of
its duties under this Agreement, which shall be paid in equal amounts by Buyer and Seller.



7. Each of Buyer and Seller agrees to indemnify and hold harmless the Escrow Agent, its , officers,
partners, employees and agents against any and all cost, losses, claims, damages, liabilities and
expenses (including reasonable costs of investigation, court costs and attorney’s fees) which may
be imposed upon the Escrow Agent in connection with its acceptance of appointment as Escrow Agent
hereunder (except those arising out of the Escrow Agent’s failure to comply with the provisions of
this Agreement or the negligence or willful misconduct of the Escrow Agent), including any
litigation arising from this Agreement or involving the subject matter hereof.



8. The Escrow Agent may in its sole discretion resign by giving (30) days written notice thereof to
the parties hereto. The parties shall furnish to the Escrow Agent written instructions for the
disposition of the Deposit. If the Escrow Agent shall not have received such written instructions
within the thirty (30) days, the Escrow Agent may petition any court of competent jurisdiction for
the appointment of a successor Escrow Agent and upon such appointment deliver the Deposit to such
successor. The costs and fees incurred by the Escrow Agent may, at the option of the Escrow Agent,
be deducted from any Deposit held pursuant hereto. The other parties hereto reserve the right to
remove the Escrow Agent at any time, provided ten (10) days’ prior written notice is given to the
Escrow Agent. The Escrow Agent neither approves nor disapproves of this transaction, nor does it
recommend for or against, nor does it have an opinion as to the legality or validity of this
transaction.



9. If the Deposit is at any time attached, garnished, or levied upon under any court order or if
the payment or delivery of the Deposit is stayed or enjoined by any court order, or if any order,
judgment or decree shall be made or entered by any court affecting the Deposit, Escrow Agent is
authorized, in its sole discretion, to rely upon and comply with the order, writ, judgment or
decree. Escrow Agent shall not be liable to any of the parties or to any other person, firm or
corporation by reason of such compliance even though the order, writ, judgment or decree may be
subsequently reversed modified, annulled, set aside or vacated.



10. Escrow Agent shall not be responsible for (i) any fluctuations in the interest rate applicable
to any cash held by it pursuant to or by virtue of this Agreement; or (ii) the validity,
sufficiency, collectability, or legal effect of any instrument deposited with Escrow Agent.



11. Notwithstanding anything contained in this Agreement to the contrary, Escrow Agent has the
right (but not the obligation) to require from Seller and Buyer a written release of liability of
Escrow Agent, a written authorization to disburse the Deposit, or both. The Escrow Agent shall
incur no liability whatsoever in connection with its good faith performance under this Agreement.
Buyer and Seller release and waive any claims they may have against the Escrow Agent, which may
result from its non-negligent performance in good faith of its duties under this Agreement,
including, but not limited to, a delay in the electronic wire transfer of Deposit. The Escrow Agent
shall be liable only for loss or damage caused directly by its acts of negligence or


7









 






willful, misconduct while performing as Escrow Agent under this Agreement. The Escrow Agent shall
be entitled to rely upon the authenticity of any signature and the genuineness and validity of any
writing received by Escrow Agent relating to this Agreement, so long as the Escrow Agent is acting
in good faith in relying thereon. The Escrow Agent shall not be bound in any way by any contract or
agreement between the other parties hereto, whether or not it has knowledge of any such contract or
agreement or of its terms or conditions.



12. The parties hereto are aware that the Federal Deposit Insurance Corporation (“FDIC”) coverages
apply only to a cumulative maximum amount of $100,000 for each individual deposit for all
depositor’s accounts at the same or related institutions. The parties hereto further understand
that certain banking instruments such as, but not limited to, re-purchase agreements and letters of
credit are not covered at all by FDIC insurance. Further the parties hereto understand that Escrow
Agent assumes no responsibility for, nor will the parties hereto hold Escrow Agent liable for, any
loss occurring which arises from the fact that the amount of the above account may cause the
aggregate amount of any individual depositor’s accounts to exceed $100,000 and that the excess
amount is not insured by the Federal Deposit Insurance Corporation or that FDIC insurance is not
available on certain types of bank instruments.



13. Buyer and Seller severally agree to provide to the Escrow Agent all instruments and documents
within their respective powers necessary for the Escrow Agent to perform its duties hereunder.



14. All notices and other communications required or permitted to be given under or by reason of
this Agreement shall be in writing and shall be deemed to have been duly given on the date of
personal delivery to or on the date of receipt at the addresses or facsimile numbers set forth in
this Section 14 or at such other address as may be specified in writing by the party to whom notice
is to be given. If mailed by first-class, postage prepaid, registered mail, return receipt
requested, such written notices shall be deemed to have been received as of the date set forth on
the return receipt. Notices, demands, and communications will, unless another address is specified
in writing be sent to the persons and at the addresses indicated below:




	 	 	 	 	 
	 

	 	To Seller:
	 	First States Investors 228, LLC
	 

	 	 	 	c/o American Financial Realty Trust
	 

	 	 	 	610 Old York Rd.
	 

	 	 	 	Suite 300
	 

	 	 	 	Jenkintown, PA 19046
	 

	 	 	 	Attn: Edward J. Matey, Jr.
	 

	 	 	 	General Counsel
	 

	 	 	 	Telephone: 215-887-2280
	 

	 	 	 	Telecopier: 215-572-1596
	 
	 	 	 	 
	 

	 	with copies to:
	 	Bryan Cave LLP
	 

	 	 	 	1290 Avenue of the Americas
	 

	 	 	 	New York, NY 10104
	 

	 	 	 	Attn: Barry C. Ross, Esquire
	 

	 	 	 	Telephone: (212) 541-2255






8









 






	 	 	 	 	 
	 

	 	 	 	Telecopier: (212) 541-1455






	 	 	 	 	 	 	 
	 

	 	To Buyer:
	 	 
 

	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Attention:	 	 
	 

	 	 	 	Fax No.:	 	 
	 
	 	 	 	 	 	 
	 

	 	with copies to:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Attention:	 	 
	 

	 	 	 	Fax No.:	 	 
	 
	 	 	 	 	 	 
	 	 	To Escrow Agent: Chicago Title Insurance Company	 	 
	 

	 	 	 	Suite 2550	 	 
	 

	 	 	 	1601 Market Street	 	 
	 

	 	 	 	Attention: Edwin G. Ditlow	 	 
	 

	 	 	 	Fax No.: 215-568-4880	 	 





15. This Agreement shall be binding upon and shall insure to the benefit of the parties hereto and
their respective successors and assigns as permitted hereunder. No person or entity other than the
parties hereto is or shall be entitled to bring any action to enforce any provision of this
Agreement against any of the parties hereto, and the covenants and agreements set forth in this
Agreement shall be solely for the benefit of, and shall be enforceable only by, the parties hereto
or their respective successors and assigns as permitted hereunder. No party to this Agreement may
assign this Agreement or any rights hereunder without the prior written consent of the parties
hereto.



16. This Agreement contains all the terms agreed upon by the parties with respect to the subject
matter hereof and supercedes all prior oral or written agreements, commitments or understandings
with respect to such matters. This Agreement may be amended only by a written instrument signed by
the party against whom enforcement or any waiver, change, modification, extension or discharge is
sought.



17. This Agreement shall be governed by, and construed according to, the laws of the Commonwealth
of Massachusetts (without regard to the choice of law provisions thereof).



18. This Agreement may be signed upon any number of counterparts with the same effect as if the
signatures on all counterparts are upon the same instrument.



19. For purposes of this Agreement, a “Business Day” shall be any day other than a Saturday,
Sunday, official Federal holiday or legal holiday in the Commonwealth of Massachusetts. If any
payment is to be made or obligation to be performed hereunder is to be made or performed on a


9









 






day other than a Business Day, it shall be deemed to be made or performed in a timely manner if
done on the next succeeding Business Day.



20. Capitalized terms used but not defined herein shall have the meanings ascribed to them in the
P&S.




10









 







IN WITNESS WHEREOF, the parties hereto have executed this ESCROW AGREEMENT as of the date set forth
above.




	 	 	 	 	 	 	 	 	 	 	 
	 	 	First States Investors 228, LLC	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 

	 	 	 	Date:
	 	 	, 2006	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	BUYER:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 

	 	 	 	Date:
	 	 	, 2006	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	ESCROW AGENT	 	 
	 
	 	 	Chicago Title
Insurance Company	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 

	 	 	 	Date:
	 	 	, 2006	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 





11









 






SCHEDULE 4(a)




Title Commitment and Survey




See Following Attachments




12









 





SCHEDULE 8(a)(iv)




Litigation



Claim of 99 Bedford Corporation with respect to damage caused by settlement of the
Improvements. A copy of the letter setting forth such claim is attached hereto.





13









 








SCHEDULE 8(a)(vi)(B)




State Street Tenant Defaults




None




14









 





SCHEDULE 8(a)(vi)(C)




State Street Tenant Claims




None




15









 





SCHEDULE 8(a)(vi)(E)




Defaults under Service Contracts




None




16









 





SCHEDULE 8(a)(vii)(B)




RoFo Notice




17









 





SCHEDULE 8(a)(xi)





	1.	 	Guaranty made by State Street Corporation dated May 9, 2001 for the benefit of Kingston
Bedford Joint Venture LLC






	2.	 	Guaranty made by State Street Corporation dated June 2, 2004 for the benefit of First
States Investors 228 LLC.




18









 











SCHEDULE 13(a)(i)




Form of Deed




QUITCLAIM DEED




     [Name of Grantor], a                                         , having an address at
                    ,                     ,                      County,
                     (the “Grantor”), for consideration of                      and
___/100 Dollars ($                    ) paid, grants to [Name of Grantee], a                     ,
having an address at                     ,                     ,                      County,
                                         (the “Grantee”), with QUITCLAIM COVENANTS,



[Insert Property Description]




[GRANTOR’S SIGNATURE ON FOLLOWING PAGE]




19









 







Witness my
hand and seal this ___ day of                                         , 200___.




	 	 	 	 	 	 	 
	 

	 	 	, a	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 





	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 






COMMONWEALTH OF MASSACHUSETTS



                                        , ss.




     On
this ___ day of                     , 20___, before me, the undersigned notary public,
personally appeared                                         , proved to me through satisfactory evidence of
identification, which was                     , to be the person whose name is signed on the
preceding or attached document, and acknowledged to me that he/she signed it voluntarily for its
stated purpose as                      [INSERT CORRECT DESCRIPTION OF CAPACITY OF INDIVIDUAL SIGNING]
of First States Investors 228, LLC.



	 	 	 	 	 
	 
	 

	 	 

Notary Public
	 	 
	 
	 	 	 	 
	 

	 	My commission expires:	 	 






20









 





SCHEDULE 13(a)(ii)




Form of Bill of Sale




BILL OF SALE





This
BILL OF SALE is given this ___ day of ___,
20___ by First States Investors 228,
LLC, with an address c/o American Financial Realty Trust, 610 Old York Rd., Suite
300, Jenkintown, PA 19046 (“Seller”), to                     , a
                     (“Buyer”).



     Seller, for good and valuable consideration received from Buyer, the receipt and sufficiency
of which are hereby acknowledged, hereby bargains, sells and conveys to Buyer all furnishings,
furniture, equipment, supplies, and other personal property (hereinafter collectively referred to
as “Personal Property”) of Seller located on, and used in connection with, the real property
located in the City of                     , County of                     , Commonwealth of Massachusetts
                    , which real property is more particularly described in the Agreement of Purchase and
Sale dated
                     ___, 20___ between Seller and Buyer, to have and to hold the Personal
Property unto Buyer, its successors and assigns, forever. Nothing contained in this Bill of Sale
shall be construed to include in the definition of Personal Property any furniture, furnishings,
trade fixtures, equipment or other personal property of any tenant occupying such real property.



     Seller hereby covenant with Buyer that (1) Seller’s interest in the Personal Property is free
and clear from any encumbrances whatsoever; and (2) Seller is the true and lawful owner of the
Personal Property and has good right and lawful authority to bargain and sell the Personal Property
to Buyer in the manner and form as aforesaid. Except as otherwise set forth herein, the Personal
Property is being transferred by Seller to Buyer in its “AS IS” condition, without any
representation or warranty of any kind or nature, express, implied, statutory or otherwise.



     IN WITNESS WHEREOF, Seller has hereunto executed this Bill of Sale as of the date first above
written.



	 	 	 	 	 	 	 	 	 
	Witnesses:	 	 	 	First States Investors 228, LLC,	 	 
	 
	 	 	 	 	 	 	 	 
	 


	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 


	 	 
	 	 	 	 

	 	 






21









 






SCHEDULE 13(a)(iii)




Form of Assignment of Leases




ASSIGNMENT AND ASSUMPTION OF LEASES AND GUARANTEES




     First States Investors 228, LLC, with an address c/o American Financial Realty Trust, 610 Old
York Road, Suite 300, Jenkintown, PA 19046 (“Assignor”), for valuable consideration received,
hereby assigns to           
               
              
               
      , a         
             having an
office at                                                              (“Assignee”) all of Assignor’s right,
title, interest and obligations as owner of certain real property and improvements known as One
Lincoln Street, Boston, Mass., which real property is more fully described on Exhibit A, attached
hereto and incorporated herein by this reference (the “Property”), under each lease and tenancy
affecting the Property (individually, a “Tenant Lease”, and collectively, the “Tenant Leases”) and
the guarantees of same (“Guarantees”), which Tenant Leases and Guarantees are identified and
described on Schedule I, attached to this Assignment and incorporated herein by this reference,
together with all right, power, and authority of Assignor to alter, modify, or otherwise change the
terms of the Tenant Leases and Guarantees and to surrender, cancel, and terminate the Tenant Leases
and Guarantees or any of them, and together with all rents, income, and profits arising from the
Tenant Lease and Guarantees from and after the date of this Assignment, and from any renewals of
the Tenant Leases and Guarantees, including, without limitation, any security and damage deposits
described therein.



     Assignee hereby accepts the foregoing assignment, assumes all of Assignor’s right, title,
interest and obligations under the Tenant Leases and Guarantees, and agrees to indemnify and hold
harmless Assignor from and against any and all loss, cost, damage and expense (including reasonable
attorneys’ fees) arising out of any of the Tenant Leases and Guarantees from and after the date
hereof.



     This Assignment shall benefit and bind Assignor and Assignee and the heirs, legal
representatives, successors, and assigns of each of them.



     IN WITNESS WHEREOF, Assignor, by its duly authorized representative, executes this Assignment
as of the ___ day of                     , 200_.



22









 





	 	 	 	 	 	 	 	 	 
	WITNESSES:	 	 	 	ASSIGNOR:	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	First States Investors 228, LLC	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:  
 

	 	 
	 

	 	 	 	 
	 	 
 

	 	 
	 


	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	ASSIGNEE	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 





COMMONWEALTH OF MASSACHUSETTS




                    , ss.




     On
this ___ day of                     , 20___, before me, the undersigned notary public,
personally appeared                                         , proved to me through satisfactory evidence of
identification, which was                                         , to be the person whose name is signed on the
preceding or attached document, and acknowledged to me that he/she signed it voluntarily for its
stated purpose as                      [INSERT CORRECT DESCRIPTION OF CAPACITY OF INDIVIDUAL SIGNING]
of First States Investors 228, LLC.



	 	 	 	 	 
	 

	 	 

Notary Public
	 	 
	 
	 	 	 	 
	 

	 	My commission expires:	 	 






COMMONWEALTH OF MASSACHUSETTS



                    , ss.




     On
this ___ day of                     , 20___, before me, the undersigned notary public,
personally appeared                     , proved to me through satisfactory evidence of
identification, which was                     , to be the person whose name is signed on the
preceding or attached document, and acknowledged to me that he/she signed it voluntarily for its
stated purpose as                      [INSERT CORRECT



23










 




DESCRIPTION OF CAPACITY OF INDIVIDUAL SIGNING] of                     .




	 	 	 	 	 
	 

	 	 

Notary Public
	 	 
	 
	 	 	 	 
	 

	 	My commission expires:	 	 






24









 






SCHEDULE 13(a)(iv)




Form of Assignment of License Agreement, Service Contracts and Intangible Property



ASSIGNMENT AND ASSUMPTION OF SERVICE CONTRACTS AND INTANGIBLE PROPERTY




     First States Investors 228, LLC , with an address c/o American Financial Realty Trust 610 Old
York Road, Suite 300, Jenkintown, PA 19046 (“Assignor”), for valuable consideration received,
hereby assigns to                                         , a                      having
an office at                                          (“Assignee”) all of Assignor’s right, title,
interest and obligations as owner of certain real property and improvements known as
                    , which real property is more fully described on Exhibit A,
attached hereto and incorporated herein by this reference (the “Property”), in (i) each contract
for operation or maintenance of the Property (individually, a “Service Contract”, and collectively,
the “Service Contracts”), identified and described on Schedule I attached to this Assignment and
incorporated herein by this reference, (ii) all intangible property owned by Assignor and used in
connection with the Property, including all trademarks and trade names used in connection with the
Property and all licenses, permits and warranties now effect with respect to the Property to the
extent assignable (collectively, the “Intangible Property”), and (iii) the license agreement with
respect to the use of a portion of the roof, identified and described on Schedule I attached to
this Assignment and incorporated herein by this reference.



     Assignee hereby accepts the foregoing assignment, assumes all of Assignor’s right, title,
interest and obligations under, or by reason of, the License Agreement, Service Contracts and the
Intangible Property, and agrees to indemnify and hold harmless Assignor from and against any and
all loss, cost, damage and expense (including reasonable attorneys’ fees) arising out of, or by
reason of, any of the License Agreement, Service Contracts or the Intangible Property from and
after the date hereof.



     This Assignment shall benefit and bind Assignor and Assignee and the heirs, legal
representatives, successors, and assigns of each of them.



     IN WITNESS WHEREOF, Assignor, by its duly authorized representative, executes this Assignment
as of the ___ day of                     , 200_.



	 	 	 	 	 	 	 	 	 
	WITNESSES:	 	 	 	ASSIGNOR:	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	First States Investors 228, LLC	 	 
	 
	 	 	 	 	 	 	 	 
	 


	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 


	 	 
	 	By:  
 

	 	 
	 

	 	 	 	 	 	 

	 	 






25









 






	 	 	 	 	 	 	 
	 	 	ASSIGNEE	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

	 	 






COMMONWEALTH OF MASSACHUSETTS



                                        , ss.




     On
this ___ day of                     , 20___, before me, the undersigned notary public,
personally appeared                     , proved to me through satisfactory evidence of
identification, which was                     , to be the person whose name is signed on the
preceding or attached document, and acknowledged to me that he/she signed it voluntarily for its
stated purpose as                      [INSERT CORRECT DESCRIPTION OF CAPACITY OF INDIVIDUAL SIGNING]
of First States Investors 228, LLC.



	 	 	 	 	 
	 

	 	 

Notary Public
	 	 
	 
	 	 	 	 
	 

	 	My commission expires:	 	 






COMMONWEALTH OF MASSACHUSETTS




                                        , ss.




     On
this ___ day of                     , 20___, before me, the undersigned notary public,
personally appeared                     , proved to me through satisfactory evidence of
identification, which was                     , to be the person whose name is signed on the
preceding or attached document, and acknowledged to me that he/she signed it voluntarily for its
stated purpose as                      [INSERT CORRECT DESCRIPTION OF CAPACITY OF INDIVIDUAL SIGNING]
of                     .



	 	 	 	 	 
	 

	 	 

Notary Public
	 	 
	 
	 	 	 	 
	 

	 	My commission expires:	 	 
	 
	 	 	 	 
	 

	 	My commission expires:	 	 
	 
	 	 	 	 
	 

	 	 	 	 





26









 





SCHEDULE 13(a)(v)




Form of Affidavit of Non-Foreign Status




AFFIDAVIT OF NON-FOREIGN STATUS

(Corporation, Partnership, Trust, Transferor Estate)




     Section 1445 of the Internal revenue Code of 1986, as amended, provides that a transferee of a
U.S. real property interest must withhold tax if the transferor is a foreign person. To inform the
transferee that withholding of tax is not required upon disposition of a U.S. real property
interest by First States Investors 228, LLC , the undersigned hereby affirms the following on
behalf of First States Investors 228, LLC:



     1. First States Investors 228, LLC is not a foreign corporation, foreign partnership, foreign
trust, or foreign estate (as those terms are defined in the Internal Revenue Code and income tax
Regulations);



     2. First States Investors 228, LLC                     ’s U.S. employer identification number is
[                    ]; and



     3. First States Investors 228, LLC                      office address is:


c/o American Financial Realty Trust

610 Old York Road

Suite 300

Jenkintown, PA 19046




     The undersigned understands that this Affidavit may be disclosed to the Internal Revenue
Service by transferee and that any false statement contained herein could be punished by fine,
imprisonment, or both.



     Under penalties of perjury, I declare that I have examined this Affidavit and to the best of
my knowledge and belief it is true, correct and complete, and I further declare that I have
authority to sign this Affidavit on behalf of First States Investors 228, LLC.



	 	 	 	 	 	 	 
	 

	 	Dated:	 	 	 	 
	 

	 	 	 	 

	 	 






27









 






EXHIBIT A_




(Form of ROFR Offer Notice)




FIRST STATES INVESTORS 228, LLC





610 Old York Rd.

Suite 300

Jenkintown, PA 19046



November ___, 2006




By Federal Express and telecopy




IPC Realty II, LLC

303 North Hurstbourne Parkway

Suite 115

Louisville, KY 40222




Attention: Bruce Wibbels





			
	Re:	 	Right of First Offer

One Lincoln Street, Boston, Massachusetts





Gentlemen:



Reference is made to the provisions of Section 11.04 of that certain First Amended and Restated
Limited Liability Company Agreement of First States Investors 228 Holdings A, LLC. (the “First
States Agreement”), which afford you certain rights to acquire the Offered Interest (the
“Rights”). All capitalized terms not otherwise defined herein shall have the respective
meanings ascribed thereto in the First States Agreement.



Please be advised that the undersigned desires to sell the Offered Interest and has entered into
that certain Agreement of Purchase and Sale, dated November ___, 2006, with FPG DF Lincoln Street,
LLC (the “Sales Agreement”). A true and complete copy of the Sales Agreement is annexed hereto.
Please be further advised that First States Group, L.P. has joined in this letter to confirm that
it shall cause the undersigned to sell the Offered Interest in accordance with the provisions of
the First States Agreement and this notice. This letter shall constitute a Sale Notice to acquire
the Property on the identical terms set forth in the Sales Agreement, except for the following:
Section34 (and all other references to the Rights ) shall be deemed deleted; you shall be deemed
the “Buyer”; and, the notice provision shall be deemed amended such that all notices to the “Buyer”
shall be sent in accordance with the notice provisions of the First States Agreement.




28









 







If you wish to accept the aforesaid, then, on or before the seventh (7th) business day
following your receipt of this notice you must (i) send a written acceptance of such offer by
notice to the undersigned (in accordance with the notice provisions in the First States Agreement),
(ii) execute and deliver to the undersigned and Chicago Title Insurance Company (the “Escrow
Agent”) a counterpart of escrow agreement, which has been executed by Escrow Agent and the
undersigned and an original counterpart of which is annexed hereto, and (ii) deliver the sum of
$20,000,000 by wire transfer of immediate funds to Chicago Title Insurance Company (the “Escrow
Agent”), as follows:




	 	 	 
	Wire to:

	 	Citizens Bank
	 

	 	2001 Market Street
	 

	 	Philadelphia, PA 19103
	 
	 	 
	ABA Number:

	 	 036076150
	 
	 	 
	Account of:

	 	Chicago Title Insurance Company
	 
	 	 
	Account Number:

	 	 6205835936
	 
	 	 
	Reference File #:

	 	One Lincoln/EGD
	 
	 	 
	Notify:

	 	Ms. Cindy Bryant @215-568-4800, Ext. 3005






Upon the foregoing you shall, as provided in the First States Agreement, be deemed to have agreed
to purchase the Offered Interest.



Please be advised that the undersigned address for all notices has been changed to that set forth
above.



	 	 	 	 	 	 	 
	 	 	Very truly yours,	 	 
	 
	 	 	First States Investors 228, LLC	 	 
	 

	 	By:
	 	                                                            	 	 
	 	 	Name: Glenn Blumenthal	 	 
	 	 	Title: Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	Confirmation:	 	 
	 
	 	 	 	 	 	 
	 	 	First States Group, L.P.,	 	 
	 	 	By: First States Group, LLC, its general partner	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

	 	 
	 	 	Name:	 	 
	 	 	Title:	 	 






29









 






	 	 	 
	cc:

	 	IPC US Real Estate Investment Trust
	 

	 	Attn: Gary M. Goodman
	 
	 	 
	 

	 	Davies Ward Phillips & Vineberg LLP
	 

	 	Attn: Fiona J. Kelly






30









 






SCHEDULE 13(a)(vii)




Form of Seller’s Closing Certificate




SELLER’S CLOSING CERTIFICATE




     First States Investors 228, LLC, a Delaware limited liability company (“Seller”), hereby
certifies to                      that, to Seller’s actual knowledge, (i) there is no material
default of Seller under the covenants of Seller contained in certain Agreement of Purchase and Sale
dated as of
                    
___, 200___ and, (ii) that the representations and warranties of Seller set forth in
said Agreement of Purchase and Sale are true and correct in all material respects as of the date of
this Seller’s Closing Certificate, except to the extent set forth on the annexed exhibit.



     This Seller’s Closing Certificate is dated as of _                    , 200_.



	 	 	 	 	 	 	 
	 	 	First States Investors 228, LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 





 









 






SCHEDULE 13(b)(viii)




Form of Buyer’s Closing Certificate




BUYER’S CLOSING CERTIFICATE




                         
(“Buyer”), hereby certifies to ___ that to Buyer’s actual
knowledge (i) that it is not in material default under the covenants of Buyer contained in that
certain Agreement of Purchase and Sale dated as of ___,
20___ and, (ii) that the
representations and warranties of Buyer set forth in said Agreement of Purchase and Sale are true
and correct in all material respects as of the date of this Buyer’s Closing Certificate, except to
the extent set forth on the annexed exhibit.



     This Buyer’s Closing Certificate is dated as of                      ___, 200_.



	 	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Its: