EXHIBIT 10.1


 


PURCHASE AGREEMENT


 


THIS AGREEMENT (herein
referred to as this “Agreement”) is made and entered into this 2nd day of
August, 2004, by and between CENTERPOINT PROPERTIES TRUST, a Maryland real
estate investment trust (herein referred to as “Purchaser”) and PRIME GROUP
REALTY, L.P., a Delaware limited partnership (herein referred to as “Seller”).


 


RECITALS:


 


A.            Seller owns interests in and controls the limited
liability companies and limited partnerships (herein referred to individually
as an “Owner” and collectively as the “Owners”) listed on the Property Schedule
(as hereinafter defined).


 


B.            Each Owner is the owner of the fee simple title to the
Project (hereinafter defined) identified on the Property Schedule next to each
such Owner’s name.


 


C.            Seller desires to cause each Owner to sell, and Purchaser
desires to purchase, the Project owned by such Owner, upon and subject to the
terms and conditions herein set forth.


 


AGREEMENTS:


 


NOW, THEREFORE, in
consideration of the foregoing premises and the respective representations,
warranties, agreements, covenants and conditions herein contained, and other
good and valuable consideration, the receipt, sufficiency and adequacy of which
are hereby acknowledged by the parties, Seller and Purchaser hereby agree as
follows:


 


1.                                       Definitions. The following terms, as used in
this Agreement, including all Exhibits, are defined in the following Sections
of this Agreement:


 




	
  Definition

  	
   

  	
  Agreement Section

  
	
   

  	
   

  	
   

  
	
  “Act”

  	
   

  	
  Section 29

  
	
  “Additional Purchaser Equity”

  	
   

  	
  Section 3E

  
	
  “Affiliate”

  	
   

  	
  Section 36

  
	
  “Agreement”

  	
   

  	
  Introduction

  
	
  “Alternate Credit Facility
  Opinion”

  	
   

  	
  Section 3C

  
	
  “Assessment”

  	
   

  	
  Section 7B

  
	
  “Assumed Contracts”

  	
   

  	
  Section 5A(v)

  
	
  “Basic Project Information”

  	
   

  	
  Section 5A

  
	
  “Basic Project Inspection”

  	
   

  	
  Section 7A

  
	
  “Bond Consent”

  	
   

  	
  Section 3C

  
	
  “Bond Costs”

  	
   

  	
  Section 3C

  
	
  “Bond Documents”

  	
   

  	
  Section 5A(vi)

  
	
  “Bond Release”

  	
   

  	
  Section 3C

  
	
  “Bonds”

  	
   

  	
  Section 3C

  
	
  “Building(s)”

  	
   

  	
  Section 2A(iii)

  
	
  “Building Lease(s)”

  	
   

  	
  Section 2A(iv)

  
	
  “Building T Parcel”

  	
   

  	
  Section 6D

  
	
  “CERCLA”

  	
   

  	
  Section 9A(xxii)

  
	
  “CIBC”

  	
   

  	
  Section 3E

  
	
  “CIBC Consent”

  	
   

  	
  Section 3E

  
	
  “CIBC Costs”

  	
   

  	
  Section 3E

  
	
  “CIBC Debt”

  	
   

  	
  Section 3E

  
	
  “CIBC Debt Assumption Approvals”

  	
   

  	
  Section 3E

  
	
  “CIBC Documents”

  	
   

  	
  Section 5A(vii)

  
	
  “CIBC Release”

  	
   

  	
  Section 3E

  
	
  “Closing”

  	
   

  	
  Section 4A

  






 

















 




	
  “Closing Date”

  	
   

  	
  Section 4A

  
	
  “Closing Escrow”

  	
   

  	
  Section 4C

  
	
  “Closing Statement”

  	
   

  	
  Section 8D(ii)

  
	
  “Correction Notice”

  	
   

  	
  Section 9D

  
	
  “Deemed Permitted Exceptions”

  	
   

  	
  Section 6A(ii)(b)

  
	
  “Delinquent Rental”

  	
   

  	
  Section 12E

  
	
  “Department”

  	
   

  	
  Section 29

  
	
  “Earnest Money”

  	
   

  	
  Section 3B

  
	
  “Escrowee”

  	
   

  	
  Section 3B

  
	
  “Exceptions Schedule”

  	
   

  	
  Section 9A

  
	
  “False Representation”

  	
   

  	
  Section 9D

  
	
  “Farm Lease(s)”

  	
   

  	
  Section 2A(iv)

  
	
  “Fee Parcel(s)”

  	
   

  	
  Section 2A(i)

  
	
  “Financial Statements”

  	
   

  	
  Section 5A(ix)

  
	
  “Ford Tenant Improvement Costs”

  	
   

  	
  Section 12H

  
	
  “Hazardous Materials”

  	
   

  	
  Section 9A(xxii)

  
	
  “Hazardous Material Laws”

  	
   

  	
  Section 9A(xxii)

  
	
  “Household Finance Lease”

  	
   

  	
  Section 12H

  
	
  “Illinois Bond Projects”

  	
   

  	
  Section 3D

  
	
  “Illinois Bonds”

  	
   

  	
  Section 3D

  
	
  “Inspection Period”

  	
   

  	
  Section 7A

  
	
  “Intangible Property”

  	
   

  	
  Section 2A(vi)

  
	
  “LaSalle”

  	
   

  	
  Section 3C

  
	
  “Laws”

  	
   

  	
  Section 6G(iv)

  
	
  “Lease Schedule”

  	
   

  	
  Section 2A(iv)

  
	
  “Lease(s)”

  	
   

  	
  Section 2A(iv)

  
	
  “Leasing Costs”

  	
   

  	
  Section 12H

  
	
  “Loan Assumption Requests”

  	
   

  	
  Section 3E

  
	
  “Major Tenants”

  	
   

  	
  Section 8B(vi)

  
	
  “Mandatory Cure Items”

  	
   

  	
  Section 6A(i)

  
	
  “New Contract Matter”

  	
   

  	
  Section 14B

  
	
  “New Lease Matter”

  	
   

  	
  Section 14A

  
	
  “New Lease Matter Leasing Costs”

  	
   

  	
  Section 12H

  
	
  “Non-Assumed Debt”

  	
   

  	
  Section 3F

  
	
  “Non-Assumed Debt Projects”

  	
   

  	
  Section 3F

  
	
  “Owner(s)” Recital A “Parcel(s)”

  	
   

  	
  Section 2A(ii)

  
	
  “Parcel 12”

  	
   

  	
  Section 6J

  
	
  “Permitted Exceptions”

  	
   

  	
  Section 6E

  
	
  “Personal Property”

  	
   

  	
  Section 2A(v)

  
	
  “Prime Indemnification Agreement”

  	
   

  	
  Section 7D

  
	
  “Project Contracts”

  	
   

  	
  Section 5A(v

  
	
  “Project Purchase Price”

  	
   

  	
  Section 3A

  
	
  “Project(s)”

  	
   

  	
  Section 2B

  
	
  “Property Schedule”

  	
   

  	
  Section 2A(iii)

  
	
  “Proration Date”

  	
   

  	
  Section 12A

  
	
  “Purchase Price”

  	
   

  	
  Section 3A

  
	
  “Purchaser”

  	
   

  	
  Introduction

  
	
  “Purchaser Parties”

  	
   

  	
  Section 7A

  
	
  “Rating Agency Evidence”

  	
   

  	
  Section 3C

  
	
  “RCRA”

  	
   

  	
  Section 9A(xxii)

  
	
  “Relevant Period”

  	
   

  	
  Section 30

  
	
  “Representations”

  	
   

  	
  Section 9C

  
	
  “SARA”

  	
   

  	
  Section 9A(xxii)

  
	
  “Seller”

  	
   

  	
  Introduction

  
	
  “Seller Estoppel Certificate(s)”

  	
   

  	
  Section 8B(vi)

  
	
  “Seller Group”

  	
   

  	
  Section 7C

  
	
  “Seller’s Rentals”

  	
   

  	
  Section 12E

  
	
  “Seller’s Share”

  	
   

  	
  Section 12F

  
	
  “SEC”

  	
   

  	
  Section 30

  
	
  “Superceded Mortgages”

  	
   

  	
  Section 6A(i)(a)

  
	
  “Survey”

  	
   

  	
  Section 6B(iii)

  
	
  “Tenant Letters”

  	
   

  	
  Section 8B(vi)

  
	
  “Tenant(s)”

  	
   

  	
  Section 2A(iv)

  
	
  “Title Commitment”

  	
   

  	
  Section 6B(i)

  






 

















 




	
  “Title Company”

  	
   

  	
  Section 6B(i)

  
	
  “Title Defect(s)”

  	
   

  	
  Section 6D

  
	
  “Title Defect Notice

  	
   

  	
  Section 6D

  
	
  “Title Exception Documents”

  	
   

  	
  Section 6B(ii)

  
	
  “Title Policy”

  	
   

  	
  Section 6B(i)

  
	
  “Undelivered Title Items”

  	
   

  	
  Section 6B(i)

  
	
  “Unpermitted Exceptions”

  	
   

  	
  Section 6C

  
	
  “Vacant Parcel(s)”

  	
   

  	
  Section 2A(ii)

  






 


2.             Agreement
to Purchase.


 


A.            Seller agrees to cause each Owner to sell, convey and
assign to Purchaser or Purchaser’s nominee(s), and Purchaser agrees to purchase
and accept under the terms and conditions and for the purchase price set forth
hereinbelow, all of the following:


 


(i)            Fee title to those certain parcels
of land legally described on Exhibit A-1 through Exhibit A-31, inclusive,
together with all privileges, rights, easements, hereditaments, and
appurtenances thereunto belonging, if any, and all right, title and interest,
if any, of each Owner owning same in and to all streets, alleys, passages and other
rights of way included therein or adjacent thereto (before or after the
vacation thereof), and all streets, water courses or water bodies adjacent to,
abutting or serving such parcels (all of said parcels being herein collectively
referred to as the “Fee Parcels” and individually as a “Fee Parcel”).


 


(ii)           Fee title to those certain parcels of
land legally described on Exhibit A 32 through Exhibit A-34, inclusive,
together with all privileges, rights, easements, hereditaments, and
appurtenances thereunto belonging, if any, and all right, title and interest,
if any, of each Owner owning same in and to all streets, alleys, passages and
other rights of way included therein or adjacent thereto (before or after the
vacation thereof), and all streets, water courses or water bodies adjacent to,
abutting or serving such parcels (all of said parcels being herein collectively
referred to as the “Vacant Parcels” and individually as a “Vacant Parcel”; the
Vacant Parcels and the Fee Parcels are collectively referred to herein as the
“Parcels” and individually as a “Parcel”). The Vacant Parcels contain no
improvements.


 


(iii)          All of Owner’s right, title and
interest in and to those certain buildings containing, in the aggregate,
approximately 3,805,108 square feet of net rentable area located on certain of
the Parcels, which buildings are generally described on Exhibit B attached
hereto and by this reference incorporated herein (herein referred to as the
“Property Schedule”) and, to the extent owned by the Owners, all other
improvements and structures of any kind or nature whatsoever now or hereafter
located on the Parcels (said buildings are herein referred to collectively as
the “Buildings” and individually as a “Building”).


 


(iv)          All of Owners’ right, title and
interest as landlord under (a) any leases, licenses and concession agreements,
if any, including all amendments thereto of any portions of the Buildings
(herein referred to as the “Building Leases”), and (b) any leases, including
all amendments thereto, of any portions of the Vacant Parcels (herein referred
to as the “Farm Leases”; the Building Leases and the Farm Leases are
collectively referred to as the “Leases” and individually as a “Lease”). A
schedule identifying the Leases and listing the tenants thereunder (herein
referred to as “Tenants”) and identifying certain of the terms thereof is
attached as Exhibit C and incorporated herein by reference (herein referred to
as the “Lease Schedule”).


 

















 


(v)           To the extent of Owners’ right, title
and interest therein, and to the extent freely transferable and assignable, all
fixtures, equipment, apparatus, cranes, signs, site plans, surveys, soil and
substrata studies, architectural renderings, plans and specifications,
engineering plans and studies, floor plans and other plans or studies of any
kind, tenant data sheets and other personal and tangible property owned by
Owners and used in connection with the operation and ownership of the Projects
(herein referred to as the “Personal Property”). A schedule identifying the
Personal Property for the Projects is attached as Exhibit D and incorporated
herein by reference.


 


(vi)          To the extent of Owners’ right, title
and interest therein, and to the extent freely transferable and assignable, all
intangible property now or hereafter owned or held by Owners between the date
hereof and the Closing, solely in connection with the Projects, including, but
not limited to, (1) all guaranties, warranties (including guaranties and
warranties pertaining to construction of the Buildings); (2) all air rights,
excess floor area rights and other development rights relating or appurtenant
to the Projects; (3) all rights to obtain utility service in connection with
the Projects; (4) assignable licenses and other governmental permits and
permissions relating to the Projects and the operation thereof; and (5) all
assignable contracts and contract rights (all of the foregoing are herein
referred to collectively as the “Intangible Property”).


 


B.            Each Parcel, the
Building thereon, if any, and the Leases, Personal Property, and Intangible
Property associated therewith, if any, are herein referred to collectively as
the “Projects” and individually as a “Project”. Each specific Project
identified on the Property Schedule may be referred to as the Project identified
with corresponding location set forth on the Property Schedule.


 


3.             Purchase Price.


 


A.            The parties hereto
agree that in connection with the transactions herein contemplated the
allocated portion of the purchase price of each of the Projects shall be the
amount specified for each Project as set forth on Exhibit T attached hereto and
made a part hereof (each such purchase price being herein referred to
individually as a “Project Purchase Price”, and the aggregate of all Project
Purchase Prices in the amount of $125,100,000.00 is herein referred to
collectively as the “Purchase Price”). The Purchase Price shall be paid as set
forth in Sections 3B, 3C and 3D below.


 


B.            Purchaser shall
deliver to Chicago Title and Trust Company (herein referred to as the
“Escrowee”) the sum of Four Million and No/100 Dollars ($4,000,000.00) as
earnest money (said money, including any and all interest accrued thereon, is
herein referred to collectively as the “Earnest Money”) within two (2) business
days after the full execution and delivery of this Agreement. The Earnest Money
shall be held in a joint order escrow to be entered into between Seller and
Purchaser with Escrowee in the form of Exhibit E attached hereto and made a
part hereof, and shall be invested in an interest bearing investment acceptable
to Seller and Purchaser, and all income earned thereon shall be paid to the
party to whom the principal portion of the Earnest Money is paid pursuant to
the terms of this Agreement. The Earnest Money shall be applied toward the
Purchase Price at Closing. Notwithstanding the foregoing, Purchaser may, in
lieu of a cash deposit, deposit an irrevocable letter of credit in the amount
of the Earnest Money, provided the form of the irrevocable letter of credit is
reasonably acceptable to Seller and provided further that the letter of credit
is issued by Bank One, N.A., LaSalle Bank National Association or such other
financial institution as may be reasonably acceptable to Seller.


 

















 


C.            Those Projects
identified on Exhibit F attached hereto and by this reference incorporated
herein are encumbered by mortgages which secure letter of credit obligations
which in turn serve as credit enhancement for the industrial revenue bonds
identified on Exhibit F attached hereto and by this reference incorporated
herein (collectively, the “Bonds”). Purchaser shall use commercially reasonable
efforts to obtain, prior to Closing, at Purchaser’s sole cost and expense
(including, without limitation, all legal fees and costs of the remarketing
agent and trustee with respect to the Bonds (the “Bond Costs”)), (i) written
evidence from each Rating Agency (as said term is defined in the Bond
Documents) that the rating on the Bonds will not be reduced or withdrawn as a
result of the delivery of the Alternate Credit Facility (as said term is
defined in the Bond Documents) (it being understood by Seller and Purchaser
that, pursuant to the Bond Documents, said evidence must be presented to the
Trustee (as said term is defined in the Bond Documents) no less than 35 days
prior to the delivery of the Alternate Credit Facility); (said written evidence
is hereinafter collectively referred to as the “Rating Agency Evidence”); (ii)
the consent of LaSalle Bank National Association (“LaSalle”), as the holder of
the mortgage debt and the issuer of the letters of credit securing the Bonds,
to the substitution of Purchaser’s credit to support the existing letters of
credit (the “Bond Consent”) (it being understood by Purchaser and Seller that
in connection with the Bond Consent, LaSalle will be asked to provide an
Alternate Credit Facility); and (iii) the unconditional, irrevocable release by
LaSalle of Seller and its affiliates from any and all liability under the Bond
Documents, except as may relate to environmental and other carve-out liability
that would otherwise survive payment in full of the Bonds (the “Bond Release”).
Purchaser and Seller acknowledge that, in connection with the delivery of the
Alternate Credit Facility to the Trustee, Purchaser shall use commercially reasonable
efforts to cause to be delivered to the Trustee the following opinions: (i) an
opinion of counsel selected by Purchaser stating that delivery of the Alternate
Credit Facility is authorized under the Bond Documents and complies with the
terms of the Bond Documents, (ii) an opinion of counsel to LaSalle (or such
other bank that shall agree to deliver an Alternate Credit Facility) stating
that the Alternate Credit Facility is a legal, valid, binding and enforceable
obligation of LaSalle in accordance with its terms (subject only to usual
exceptions relating to bankruptcy and similar matters) and (iii) an opinion of
Bond Counsel (as said term is defined in the Bond Documents) to the effect that
the Alternate Credit Facility will not adversely affect the exclusion from
gross income of interest on the Bonds (said opinions are hereinafter
collectively referred to as the “Alternate Credit Facility Opinions”).
Purchaser shall, within five (5) days after written request therefor, provide
any information and/or materials regarding Purchaser and/or any of its
affiliates reasonably requested or required by LaSalle, the remarketing agent,
the Bond trustee and/or any holder of the Bonds in connection with the
foregoing. Seller agrees to cooperate and assist Purchaser in its efforts to
obtain the Rating Agency Evidence, the Bond Consent, the Bond Release and the
Alternate Credit Facility Opinions. Purchaser shall receive a credit against
the Purchase Price for the aggregate amount of the Bonds and other amounts due in
connection therewith (other than the Bond Costs), including without limitation
accrued interest, less any reserves and escrows that will continue to be
maintained in connection therewith for the benefit of the borrower or guarantor
thereunder after the assumption of the Bonds by Purchaser, all as set forth in
said Exhibit F (as may be adjusted between the date hereof and the Closing
Date). Notwithstanding the foregoing or anything else in this Agreement to the
contrary, if Purchaser fails to obtain either the Rating Agency Evidence, the
Bond Consent, the Bond Release and the Alternate Credit Facility Opinions, or
any of them, as provided aforesaid, despite reasonable efforts to do so,
Purchaser shall not be in default hereunder and shall be permitted to terminate
this Agreement upon written notice given to Seller prior to the Closing Date
and obtain a return of all Earnest Money theretofore paid, it being
acknowledged and understood that obtaining the Rating Agency Evidence, the Bond
Consent, the Bond Release and the Alternate Credit Facility Opinions are
conditions of Closing and will not subject Purchaser to default for failing to
obtain the same, provided Purchaser has used diligent and commercially
reasonable efforts to obtain the same. Seller will reasonably cooperate with
Purchaser in connection with Purchaser’s


 

















 


assumption of Seller’s (or its
affiliate’s) obligations with respect to the Bonds and will execute and deliver
any certificates or documents reasonably and customarily requested to effectuate
such assumption and assignment, provided such documents are in form and
substance reasonably acceptable to Seller. At Purchaser’s option, upon notice
to Seller given not less than sixty (60) days prior to the Closing Date,
Purchaser may elect to purchase one or more of the Projects encumbered by the
Bonds free and clear of the Bonds which currently encumber such Projects, in
which case Seller shall redeem such Bond(s) as of the Closing Date.
Notwithstanding the foregoing provisions of this Section 3C, so long as the
value of the Bonds and Illinois Bonds (as defined below) assumed by Purchaser
equals or exceeds $24.9 million in the aggregate (less, if applicable, the
outstanding principal amount of any Bonds Purchaser elects to cause Seller to
redeem), Purchaser shall not be entitled to terminate this Agreement pursuant
to this Section 3C as a result of any such redemption or Purchaser’s failure to
obtain any of the approvals or consents required with respect to the Bonds.


 


D.            In addition to the
Bonds, Prime IRB Holdings II LLC is the holder of those certain industrial
revenue bonds identified on Exhibit G attached hereto and by this reference
incorporated herein (collectively, the “Illinois Bonds”). At Purchaser’s
option, upon notice to Seller given not less than forty-five (45) days prior to
the Closing Date, Purchaser shall elect to (i) purchase the Projects identified
on Exhibit G (the “Illinois Bond Projects”) free and clear of the Illinois
Bonds, in which case Seller shall redeem the Illinois Bonds, or (ii) purchase
the Illinois Bond Projects subject to the Illinois Bonds, in which case Seller
agrees to (1) reasonably cooperate with Purchaser in connection with
Purchaser’s assumption of Seller’s obligations with respect to the Illinois
Bonds; (2) execute and deliver any certificates or documents reasonably and
customarily requested to effectuate such assumption and assignment, provided
such documents are in form and substance reasonably acceptable to Seller; and
(3) shall use reasonable commercial efforts to deliver to Purchaser copies of
all Adjustable Rate Reset Certificates issued with respect to the Illinois
Bonds. Notwithstanding anything to the contrary contained in this paragraph,
provided that Seller has been reasonably cooperating with Purchaser in
connection with Purchaser’s assumption of Seller’s obligations with respect to
the Illinois Bonds, Closing shall not be delayed in the event that Purchaser is
unable to assume Seller’s obligations under the Illinois Bonds on the Closing
Date. Notwithstanding anything to the contrary contained in this Agreement, in
no event shall Purchaser be entitled to any credits against the Purchase Price
in connection with the assumption of the Illinois Bonds.


 


E.             The parties further
acknowledge that Purchaser intends to assume Seller’s obligations under the
existing debt (the “CIBC Debt”) originally held by CIBC Inc. (“CIBC”), which
CIBC Debt is secured by those Projects identified on Exhibit H attached hereto
and made a part hereof. Seller agrees to use commercially reasonable efforts to
obtain the approval of all requisite entities to the assumption by Purchaser of
the CIBC Debt, including, but not limited to, sending out requests for loan
assumption packages (the “Loan Assumption Requests”) to the servicer of the CIBC
Debt (said approvals are hereinafter collectively referred to as the “CIBC Debt
Assumption Approvals”). Purchaser agrees that, in connection with the efforts
of Purchaser and Seller to obtain the CIBC Debt Assumption Approvals, Purchaser
or an affiliate acceptable to such servicer shall agree in written
documentation reasonably acceptable to the servicer to fund additional amounts
of equity (the “Additional Purchaser Equity”) for leasing and other costs
relating to the Projects encumbered by the CIBC Debt. It shall be a condition
to Seller’s obligations hereunder that Seller shall obtain from the servicer of
the CIBC Debt (i) a written consent and amendments to the loan documents
relating to the CIBC Debt evidencing the assumption of the CIBC Debt by Purchaser
(the “CIBC Consent”), (ii) the unconditional, irrevocable release of Seller and
its affiliates from any and all liability under the CIBC Debt, except as may
relate to environmental and other carve-out liability that would otherwise
survive payment in full of the CIBC Debt (the “CIBC Release”), and (iii) an
estoppel certificate substantially in the servicer’s standard form. Purchaser
agrees to cooperate and assist Seller in its efforts to obtain the CIBC Debt
Assumption Approvals, including, but not


 

















 


limited to, providing the
servicer of the CIBC Debt with any reasonable and customarily provided
financial information it shall request in connection therewith. At Closing,
Seller and Purchaser will sign such documents and agreements as are reasonable and
customarily required by the servicer in connection with Purchaser’s assumption
of the CIBC Debt and funding of the Additional Purchaser Equity. Purchaser
shall pay (or reimburse Seller for) all application fees, assumption fees, and
any other costs and expenses (including up to $25,000 for Seller’s legal fees
and the full amount of lender’s legal fees and costs (the “CIBC Costs”))
incurred by Seller in connection with Purchaser’s assumption of or defeasance
of the CIBC Debt. Purchaser shall receive a credit against the Purchase Price
in the amount of the existing outstanding principal balance and accrued and
unpaid interest of the CIBC Debt and all other amounts accrued and unpaid with
respect to any period of time prior to Closing (other than the CIBC Costs),
less any reserves and escrows maintained in connection therewith for the
benefit of the borrower or guarantor thereunder, all as set forth in said
Exhibit H (as may be adjusted between the date hereof and the Closing Date).
Notwithstanding anything to the contrary contained in this Section 3D,
obtaining the CIBC Debt Assumption Approvals shall not be a condition precedent
to Closing, and if the CIBC Debt Assumption Approvals are not received within
sixty (60) days after the Loan Assumption Requests have been properly submitted
by Seller in accordance with the CIBC Documents, Purchaser shall be required to
proceed with the defeasance of the CIBC Debt in accordance with the provisions
of the CIBC Documents. All fees, costs, and expenses (including up to $25,000
for Seller’s legal fees and the full amount of lender’s legal fees and costs)
incurred by Seller in connection with Purchaser’s defeasance of the CIBC Debt
shall be paid by Purchaser.


 


F.             All Projects not
encumbered by the CIBC Debt or mortgages securing the Bonds (the “Non-Assumed
Debt Projects”) are subject to certain mortgage liens securing obligations (the
“Non-Assumed Debt”) described on Exhibit H, which Non-Assumed Debt shall be
paid off at Closing by Seller and which will not be assumed by Purchaser.
Purchaser shall pay all yield maintenance costs and related prepayment costs
incurred by Seller in connection with the prepayment of the Non-Assumed Debt up
to a maximum of $151,000. Any costs in excess of $151,000, if any, relating to
the prepayment of the Non-Assumed Debt shall be paid by Seller.


 


G.            The balance of the
Purchase Price shall be paid at the Closing, plus or minus prorations, by wire
transfer of federal funds into the Closing Escrow for disbursement to Seller
upon full compliance with the provisions hereof and thereof.


 


4.             Time of Closing.


 


A.            Subject to the
satisfaction or waiver of the conditions precedent contained in this Agreement,
and subsequent to the expiration of the Inspection Period without Purchaser
having terminated as provided in Section 7A hereof, the consummation of the
sale of the Projects (herein referred to as the “Closing”) shall occur on the
forty-sixth (46th) day following the date of this Agreement (herein referred to
as the “Closing Date”). Notwithstanding the foregoing, either Purchaser or
Seller may extend the Closing Date for up to two (2) additional fifteen (15)
day periods (in the aggregate for both Seller and Purchaser) to allow such
party to fulfill the conditions precedent set forth in Sections 10A(vi) and
10B(ii) of this Agreement, to obtain the Tenant Letters required by Section
8B(x) of this Agreement, to cure Title Defects as set forth in Section 6, or to
redeem any of the Bonds or Illinois Bonds which Purchaser elects to redeem
pursuant to Section 3C or 3D. The right to extend the Closing Date shall be
exercised, if at all, by written notice to the other party given not later than
the two (2) business days prior to the Closing Date (as extended, if
applicable). The Closing shall take place at the downtown Chicago offices of
the Title Company, or such other place as the parties may agree.


 


B.            In the event
Purchaser is required to effect a defeasance of the CIBC Debt in accordance
with Section 3E and such defeasance cannot reasonably be


 

















 


accomplished prior to the
Closing Date, as it may have been extended pursuant to Section 4A, provided
Purchaser proceeds diligently to effect the defeasance of the CIBC Debt, the
Closing shall occur five (5) business days after the date on which such
defeasance occurs, provided, however, if such defeasance has not been
accomplished by December 2, 2004, either party shall have the right to
terminate this Agreement at any time thereafter upon five (5) days written
notice to the other party , provided that if the defeasance occurs within such
five (5) day period, the notice of termination shall be null and void and the
parties shall close the transaction as contemplated herein.


 


C.            The Closing shall be
consummated through a “New York”-style escrow closing (herein referred to as
the “Closing Escrow”) with the Escrowee on the Closing Date.


 


5.             Due Diligence
Documents to be Delivered by Seller.


 


A.            To the extent not
previously provided, Seller shall deliver or make available (subject to Section
5B) to Purchaser within two (2) days after the date of this Agreement, the
following items to the extent same exist and are in each Owner’s possession,
relating to each of the Projects (collectively, the “Basic Project
Information”):


 


(i)            Copies of all certificates of
occupancy and other necessary governmental licenses or approvals relating to
the Buildings and the Tenants.


 


(ii)           True, correct and complete copies of
“as-built” plans and specifications relating to the Buildings and any
modifications or amendments thereto, if available, and copies of any reports or
studies (including engineering, soil boring and physical inspection reports of
employees, principals, consultants, governmental authorities or insurance
carriers) in respect of the physical condition or operation of the Building.


 


(iii)          Copies of the bills issued for the
three (3) most recent years for which bills have been issued (or for such
shorter period that the Owners owned the applicable Project) for all real
estate taxes and a copy of any and all notices pertaining to real estate taxes
or assessments. Seller shall promptly deliver or make available (subject to the
provisions of Section 5B) to Purchaser copies of any such bills or notices
received by Seller after the date hereof but prior to the Closing. In the event
that any taxes or assessments for said years have been appealed or are in the
process of being appealed, Seller shall provide Purchaser with copies of all
petitions for appeal and evidence of fee agreements or of full payment of the
cost of any such appeals including the full payment of attorneys’ fees, as
applicable, and Purchaser shall reimburse Seller for a portion of such fees to
the effect that (1) such fee reductions benefit a period of time from and after
the Closing, (2) Purchaser received a proration at Closing relating to such
taxes, or (3) Tenants reimburse Purchaser for such fees under the Leases.


 


(iv)          A schedule of all claims and
settlements on insurance policies within the past three (3) years (or for such
shorter period that the Owners owned the applicable Project) and true and
correct copies of any such claim or settlement upon Purchaser’s request.


 


(v)           True, correct and complete copies of
all service and maintenance contracts, management agreements, leasing
agreements and other written agreements of any kind, and all amendments and
modifications thereto, which Seller, Owner or its agents and affiliates have
entered into in connection with the construction, development, maintenance,
ownership and operation of the Projects which might survive the Closing and a
schedule listing all such contracts and


 

















 


agreements (such contracts
and agreements being herein collectively referred to as the “Project
Contracts”). If no such Project Contracts exist as to any Project, the
applicable Owner shall deliver to Purchaser its written certification thereof.
All Project Contracts described on Exhibit I attached hereto and made a part
hereof (herein referred to as the “Assumed Contracts”) will be assigned to
Purchaser at Closing. Seller shall be responsible for all amounts due under all
Project Contracts other than Assumed Contracts.


 


(vi)          True, correct and complete copies of
all documents evidencing and securing, and otherwise relating to, the Bonds and
the Illinois Bonds and Seller’s and its affiliates reimbursement obligations
related thereto (herein referred to collectively as the “Bond Documents”).


 


(vii)         True, correct and complete copies of
all documents evidencing and securing, and otherwise relating to, the CIBC Debt
and Seller’s and its affiliates obligations related thereto (herein referred to
collectively as the “CIBC Documents”).


 


(viii)        True, correct and complete copies of the
Leases.


 


(ix)           Statements of operations (herein
referred to as the “Financial Statements”) for 2003 (or for such period that
the Owners owned the applicable Project), as well as operating statements for
the months of January through April, inclusive, of 2004.


 


(x)            Copies of existing title policies
and surveys.


 


(xi)           True, correct and complete copies of
all financial statements and insurance certificates (or policies) received from
Tenants and correspondence files of such Tenants.


 


(xii)          All other material studies, reports,
maps, and documents related to the Projects, including without limitation
engineering reports, surveys, environmental reports, traffic circulation, flood
control and drainage plans, design renderings, shop drawings, feasibility
studies and all correspondence with governmental agencies and their personnel
concerning the same, but excluding market analyses and any materials designated
privileged under the attorney-client privilege in connection with existing
environmental litigation.


 


B.            Seller or its agent
shall copy any of the Basic Project Information upon the reasonable request of
Purchaser, to the extent same can be readily copied and if same cannot be
readily copied, Seller shall make such Basic Project Information available for
review by Purchaser.


 


C.            To the extent not
previously provided, Seller shall deliver or make available to Purchaser within
five (5) business days after the date on which a detailed request is made, any
documents reasonably requested by Purchaser in connection with Purchaser’s
diligence with respect to whether the interest on the Bonds is exempt from
federal income taxation to the extent such documents exist and are in Seller’s
possession or control.


 


6.             Title and Survey.


 


A.            As used herein, the
following definitions shall apply:


 


(i)            “Mandatory Cure Items” shall mean:


 


(a)                                  superceded mortgages on the CIBC Debt
Projects and those mortgages that were intended to be superceded mortgages
relating to the CIBC Debt (“Superceded Mortgages”);


 

















 


(b)                                 mortgages and other related liens on the Non
Assumed Debt Projects;


 


(c)                                  mechanic lien claims or other liens or
encumbrances of a definite or ascertainable amount that can be removed by the
payment of a definite sum of money at the Closing provided the same may be
bonded or insured over at Seller’s expense and provided further that Seller
shall not in any event be required to expend more than $2,000,000.00 in the
aggregate to cure any Mandatory Cure items (excluding mortgages and related
liens);


 


(d)                                 judgments against Seller or any Owner
provided the same may be bonded or insured over at Seller’s expense and
provided further that Seller shall not in any event be required to expend more
than $2,000,000.00 in the aggregate to cure the Mandatory Cure items (excluding
mortgages and related liens); and


 


(d)                                 requirements relating to the ownership
documents of Seller or any Owner.


 


(ii)           “Deemed Permitted Exceptions” shall mean:


 


(a)                                  mortgages and other related liens relating to
the Bonds and the CIBC Debt, other than the Superceded Mortgages;


 


(b)                                 the rights of Tenants under the Leases as
tenants only with no rights to purchase except for the rights of the tenants
set forth on Exhibit J attached hereto and by this reference incorporated
herein to purchase the Project in which they are located; provided, however,
Seller shall disclose such rights to the Title Company and cause the Title
Company to provide affirmative title coverage insuring that those tenants have
no right to purchase any of the Projects as a result of the transaction
contemplated by this Agreement;


 


(c)                                  for each Project, those matters set forth for
such Project on Exhibit K attached hereto and made a part hereof;


 


(d)                                 acts of the Purchaser and those claiming by,
through, and under Purchaser; and


 


(e)                                  real estate taxes and assessments not due and
payable as of the Closing.


 


B.            Seller has
delivered, and Purchaser acknowledges receipt of the following with respect to
each Project, excepting only those items listed on Exhibit L (the “Undelivered
Title Items”):


 


(i)            an updated title commitment (dated
after May 1, 2004) for each Project (herein referred to as a “Title
Commitment”) issued by the Chicago Title Insurance Company (herein referred to
as the “Title Company”) to issue an ALTA Form B (1992) Owner’s Title Insurance
Policy (herein referred to as a “Title Policy”) in the amount of the


 

















 


applicable Project Purchase
Price (irrevocable for at least six (6) months) showing title to the applicable
Project in the applicable Owner, naming Purchaser as the proposed insured and
showing the current status of title as to such Project;


 


(ii)           copies of all documents referenced in
Schedule B to such Title Commitments (the “Title Exception Documents”); and


 


(iii)          an existing survey and a current
as-built survey dated after June 1, 2004 (each such survey is herein referred
to as a “Survey”), prepared by a surveyor licensed by the State of Illinois or
Indiana, as applicable, and reasonably acceptable to Purchaser, certified to
Purchaser and the Title Company by such surveyor as being true, accurate and
having been prepared in accordance with the minimum requirements for a Land
Title Survey adopted by the American Title Association (now known as the
American Land Title Association) and the American Congress on Survey and
Mapping in 1992, meeting the requirements of a Class A Urban Survey, and
setting forth items 1, 2, 3, 4, 6, 7(a), 7(b), 7(c), 8, 9, 10, 11, and 15 shown
on Table A thereof.


 


C.            With the sole
exception of the Undelivered Title Items, Purchaser has reviewed all of the
Title Commitments, Surveys, and Title Exception Documents related to each of
the Projects. All matters (the “Unpermitted Exceptions”), other than Deemed
Permitted Exceptions set forth in the Title Commitments, Surveys and Title
Exception Documents other than the Permitted Exceptions are unacceptable to
Purchaser. Seller shall cure all Mandatory Cure Items to the extent required
pursuant to Section 6A(i) and shall, subject to the terms and provisions of
this Section 6, use commercially reasonable efforts to have the Unpermitted
Exceptions deleted or insured over prior to the Closing, and, if required, the
Closing may be extended in accordance with the provisions of Section 4A for up
to two (2) additional fifteen (15) day periods until said items have been
deleted or insured over.


 


D.            Seller shall deliver
the Undelivered Title Items as soon as is reasonably practicable, but in no
event later than the thirtieth (30th) day following the date of this Agreement,
provided, however, in no event shall Seller be in default hereunder for a
failure to correct minor clean-up items and corrections within said thirty-day
period if the Undelivered Title Items delivered were otherwise in conformance
with the provisions of this Agreement within said thirty-day period. Purchaser
shall have seven (7) business days after the delivery of all Undelivered Title
Items for each Project to review the same. If an Undelivered Title Item shall
disclose any matters (other than Deemed Permitted Exceptions or Mandatory Cure
Items) which were not raised or shown in the previously delivered Title
Commitments, Title Exception Documents or the Surveys previously delivered by
Seller to Purchaser, if any, and which are unacceptable to Purchaser for any
reason (subject to any obligations imposed upon Purchaser by law to act in good
faith), including, but not limited to, the unwillingness of the Title Company
to issue extended coverage or the endorsements described in Section 6G below,
then Purchaser shall have the right to object to any such matters (each a
“Title Defect” and collectively, “Title Defects”) by delivering to Seller,
prior to the expiration of the aforementioned seven (7) business day period,
written notice (the “Title Defect Notice”) of such Title Defects. Purchaser’s
failure to deliver the Title Defect Notice as aforesaid, or failure to raise in
the Title Defect Notice any such matters, shall be deemed Purchaser’s
disapproval of such matters disclosed in such Undelivered Title Item and any
such matters shall be deemed Title Defects. Within five (5) business days after
receipt of a Title Defect Notice or expiration of said five (5) business day
period, Seller shall advise Purchaser as to which Title Defects will be deleted
or insured over and, if applicable, which of such Title Defects will not be so
deleted or insured over. If required, Seller shall have the right to extend the
Closing in accordance with the provisions of Section 4A for up to two (2)
additional fifteen (15) day periods until said items have been deleted or
insured over. Seller’s failure to advise


 

















 


Purchaser within said five (5)
business day period shall be deemed Seller’s election to not cause such Title
Defects to be deleted or insured over. To the extent there is an agreement
between Seller and Purchaser as to the Title Defects to be deleted or insured
over, all other matters referenced in the Undelivered Title Item so delivered,
other than Mandatory Cure Items, shall be Permitted Exceptions hereunder as to
the applicable Project. If, however, Seller elects or is deemed to elect not to
cause a Title Defect to be deleted or insured over, then Purchaser shall have
the right to terminate this Agreement by written notice given not later than
five (5) business days after Purchaser’s receipt of Seller’s notice as to Title
Defects or, if applicable, the expiration of the five (5) business day period
in which Seller was to deliver such notice. Purchaser’s failure to deliver to
Seller notice of Purchaser’s termination of this Agreement within the aforesaid
five (5) business day period shall be deemed Purchaser’s election to terminate
this Agreement. In the event that Purchaser elects or is deemed to have elected
to terminate this Agreement as a result of a Title Defect affecting that
certain Parcel located at East Chicago Enterprise Center on which the building
commonly referred to as Building T is located (the “Building T Parcel”), Seller
may, at Seller’s sole option, by written notice given not later than seven (7)
business days after Purchaser’s election or deemed election to terminate this
Agreement, deem such election to be a termination of the Agreement solely with
respect to the Building T Parcel and this Agreement shall continue in full
force and effect as to the balance of the Projects with no adjustment to the
Purchase Price. Seller’s failure to deliver to Purchaser notice of Seller’s
election within the aforesaid seven (7) business day period shall be deemed
Seller’s election to terminate this Agreement only with respect to the Building
T Parcel, in which event this Agreement shall continue in full force and effect
as to the balance of the Projects with no adjustment to the Purchase Price.


 


E.             At the Closing, the
Projects shall be conveyed (directly or indirectly) to Purchaser or Purchaser’s
nominee(s) by special warranty deeds, subject only to Deemed Permitted
Exceptions; and other matters agreed or deemed to be Permitted Exceptions as
provided in this Section 6 (collectively, the “Permitted Exceptions”).


 


F.             At the Closing, the
Title Commitments shall be updated and furnished to Purchaser, showing title
being subject only to Permitted Exceptions. If such updated Title Commitments
disclose any matters not previously disclosed in the Title Commitments
originally delivered to Purchaser, other than Permitted Exceptions, Purchaser
and Seller shall thereafter follow the same procedure as set forth in Section
6D for the determination of Permitted Exceptions, Title Defects, regulations
thereto, and rights of termination. In such event, Closing may be delayed by
either Purchaser or Seller for up to 30 days as may be necessary to accomplish
the foregoing.


 


G.            During the
Inspection Period, Purchaser shall determine whether or not it can obtain the
agreement of the Title Company that the Title Policy, which will be issued
pursuant to the title commitment at the Closing, will provide full extended
coverage insurance which shall result in the deletion of the general exceptions
and confirm that the Title Policy for each Project shall contain the following
affirmative endorsements (all on the Title Company’s standard form):


 


(i)            An endorsement insuring Purchaser
that except for Permitted Exceptions, there are no violations of any restrictive
covenants, conditions or restrictions affecting the Project, that there are no
encroachments by the Building onto any easements or any building lines or
setbacks affecting the Project, or onto any adjacent property, or any
encroachments onto the Parcel of existing improvements located on adjoining
land.


 


(ii)           An access endorsement insuring that
the streets and roads adjacent to the Project (or adjacent to easements
benefiting such Projects) are public streets and that there is direct and
unencumbered


 

















 


access to the same from the Project.


 


(iii)          A survey endorsement insuring that all
the property insured is legally described on a specifically mentioned Survey
and foundations in place as of the date of such policy are within the lot lines
and applicable setback lines, that the Building does not encroach onto
adjoining land or onto any easements, and that there are no encroachments of
improvements from adjoining land onto the Project or any part thereof, except
for Permitted Exceptions.


 


(iv)          An ALTA 3.1 zoning endorsement
insuring that the Project is zoned for the present and contemplated building
and business thereon and insuring against loss or damage arising due to a
prohibition of said use or requiring removal of the Buildings due to a
violation of any applicable laws, codes, ordinances, statutes, regulation (all
such laws, codes, ordinances, statutes and regulations are herein referred to
collectively as “Laws”), including but not limited to Laws relating to area of
the Project, floor area of the Building, setbacks, height and number of parking
spaces.


 


(v)           A contiguity endorsement insuring
that all parcels comprising each Project, to the extent applicable, are
contiguous.


 


(vi)          An endorsement insuring that all of
the Project is covered by one (1) or more permanent index numbers which do not
cover other property.


 


(vii)         An endorsement deleting the creditors’
rights exception.


 


(viii)        A utility facility endorsement.


 


(ix)           Restriction and/or encroachment
endorsement, if applicable.


 


Purchaser and Seller shall proceed diligently and cooperate with each
other to obtain the written commitment of the Title Company to issue all of the
endorsements referenced above. Seller shall execute those documents listed on
Exhibit M attached hereto in form and substance reasonably required by the
Title Company in order to issue the endorsements referenced above and shall
provide all additional documentation reasonably and customarily required by the
Title Company in order to issue the extended coverage and all of the endorsements.
In the event that Purchaser determines that it cannot obtain extended coverage
or any of the foregoing endorsements, Purchaser may terminate this Agreement
upon written notice to Seller given not later than 5:00 p.m., Chicago time, on
the last day of the Inspection Period.


 


H.            With respect to the
11039 Gage Avenue Project and the 11045 Gage Avenue Projects, Purchaser
acknowledges and agrees that the forms of the pro forma policies distributed
7/27/04, including, without limitation, the access endorsements attached
thereto, are acceptable in form and substance to Purchaser and, provided the
Title Company delivers Title Policies in substantially the same form as the
7/27/04 pro formas, such Title Policies will be accepted by Purchaser as
meeting the requirements contained herein for such Title Policies.


 


I.              Purchaser
acknowledges and agrees that Purchaser has received and reviewed copies of the
settlement agreements with USX Corporation (the “USX Settlement Agreement”) and
Signode Corporation, a Division of Illinois Tool Works, Inc. (the “Signode
Settlement Agreement”) relating to the litigation entitled Enterprise Center
VII, L.P., Enterprise Center VIII, L.P., Enterprise Center IX, L.P., Enterprise
Center X, L.P. and Kemper/Prime Industrial Partners v. USX Corporation v. The
Prime Group, Inc., Case No. 96C 5283, filed on August 22, 1996, in the United
States District Court for the Northern District of Illinois, Eastern Division,
and that certain provisions of the Settlement Agreements, including, but not
limited to, release provisions, are binding upon


 

















 


and/or benefit Purchaser, as a successor in
interest to Seller and the Owners of the Chicago Enterprise Center Project.
Purchaser further acknowledges and agrees that Seller is required pursuant to
the USX Settlement Agreement and the Signode Settlement Agreement to record the
Memorandum of Settlement re USX Corporation and the Memorandum of Settlement re
Signode Corporation (collectively, the “Memoranda of Settlement Agreements”)
against those Parcels which are part of the Chicago Enterprise Center Project,
and that the recordation of such documents shall in no event cause a default by
Seller under this Agreement. Unless and until the Title Company includes the
Memoranda of Settlement Agreements as exceptions on the relevant Title
Policy(ies), such documents shall not constitute Permitted Exceptions
hereunder. Notwithstanding the foregoing, Purchaser and Seller each acknowledge
and agree that the Memoranda of Settlement Agreements are documents recorded in
the records of Cook County, Illinois against those Parcels comprising the
Chicago Enterprise Center Project and that under no circumstances shall
Seller’s failure to include the Memoranda of Settlement Agreements as Permitted
Exceptions in the Special Warranty Deeds to be delivered at Closing create any
liability whatsoever on the part of Seller and/or its successors and assigns to
Purchaser and/or its successors and assigns. The provisions of this Section 6I
shall survive the Closing.


 


J.             As of the date of
this Agreement, Seller has been unable to secure the Title Company’s agreement
to issue an access endorsement with respect to that portion of the Parcel
comprising the 4440-4635 Railroad, East Chicago, IN Project lying immediately
west of the Indiana Harbor Canal (“Parcel 12”). Prior to the Closing, Seller
shall use commercially reasonable efforts to obtain an access endorsement with
respect to Parcel 12 from the Title Company. In the event the Title Company
does not agree to issue such access endorsement on or before September 1, 2004,
Seller shall use commercially reasonable efforts to obtain an access easement
across the Indiana Harbor Belt Railroad tracks adjacent to Parcel 12 for the
benefit of Parcel 12, including the payment of any commercially reasonable fee
not to exceed One Hundred Thousand Dollars ($100,000) in connection therewith.
Notwithstanding anything to the contrary contained in this Agreement, Seller’s
failure to obtain either the access endorsement or the access easement shall in
no event be a Title Defect hereunder and Purchaser shall be obligated to close
the transactions contemplated by this Agreement without an access endorsement
or access easement with respect to Parcel 12. In the event Seller does not
obtain an access endorsement or access easement prior to Closing but Purchaser
is able to negotiate an access easement within the six (6) month period after
the Closing Date, Seller shall pay any commercially reasonable fee paid in
connection therewith up to a maximum of One Hundred Thousand Dollars
($100,000).


 


7.             Inspection Period.


 


A.            At all times prior
to Closing, including times following the “Inspection Period” (which Inspection
Period is herein defined to be the period which commenced as of May 4, 2004 and
expired as of the date and time on which this Agreement is executed by the
parties), Purchaser, its agents and representatives (the “Purchaser Parties”)
shall be entitled to conduct an inspection (herein referred to as “Basic
Project Inspection”), which will include the rights to (subject to the
provisions of this Section 7): (i) upon reasonable prior notice (which shall be
at least one (1) business day), enter upon the Projects at reasonable times
during business hours to perform inspections and tests of the Projects, including,
but not limited to, inspection, evaluation and testing of the heating,
ventilation and air-conditioning systems and all components thereof, the roof
of the Buildings, the parking lots, all structural and mechanical systems
within the Buildings, including, but not limited to, sprinkler systems, power
lines and panels, air lines and compressors, automatic doors, tanks, pumps and
plumbing, and all equipment, vehicles, and Personal Property, provided Seller
shall have the right to have a representative present during any visits to or
inspections of any Project; (ii) examine and copy any and all books, records,
tax returns, correspondence, financial data, leases, and all other contracts,
agreements, documents in the possession of Seller, Owners or their agents,
relating to


 

















 


receipts and expenditures
pertaining to the Projects for the three (3) most recent full calendar years
(or such shorter period of time as Owners may have owned the Projects) and the
current calendar year; (iii) make investigations with regard to zoning,
environmental (as provided in Section 7B below), building code and other legal
requirements including, but not limited to, an environmental “Assessment” as
specified in Section 7B below including (but not limited to) an analysis of the
presence of any asbestos, chlordane, formaldehyde or other Hazardous Material
(as hereinafter defined) in, under or upon the Project; (iv) make or obtain
market studies and real estate tax analyses; (v) interview any Tenant at the
Project with respect to its current and prospective occupancy at the Project
(provided, however, that neither Purchaser nor any of the Purchaser Parties
shall contact or attempt to contact any Tenant of any Project for any reason
whatsoever without Seller’s prior written consent, which may be granted or
withheld in Seller’s reasonable discretion, and Seller shall have the right to
have a representative present during any meetings or discussions with any
Tenant); (vi) review the Basic Project Information; (vii) analyze the financial
feasibility of ownership of the Projects; and (viii) analyze the tax-exempt
status of the Bonds and the Illinois Bonds. If Purchaser, in its sole and
absolute discretion, determines that the results of any inspection, test or
examination do not meet Purchaser’s (or its underwriters’, investment
committees’, board of directors’, investment bankers’, lenders’, ratings
agencies’ or investors’) criteria for the purchase, financing or operation of
any of the Projects in the manner contemplated by Purchaser, or if the
information disclosed does not otherwise meet Purchaser’s investment criteria
or underwriting for any reason whatsoever, or if Purchaser, in its sole
discretion, otherwise determines that any of the Projects are unsatisfactory to
it, then, subject to Section 7C below, Purchaser may terminate this Agreement
with respect to all (but not less than all) of the Projects by written notice
to Seller, with a copy to Escrowee, given not later than 5:00 p.m., Chicago
time, on the last day of the Inspection Period. Upon such termination, the
Earnest Money, together with all interest thereon, shall be returned
immediately to Purchaser and neither party shall have any further liability to
the other hereunder (except for obligations that, pursuant to the terms of this
Agreement, survive the termination of this Agreement). Purchaser’s failure to
terminate this Agreement prior to the expiration of the Inspection Period shall
be deemed Purchaser’s waiver to terminate this Agreement pursuant to this
Section 7A.


 


The parties hereto acknowledge that Purchaser will expend material sums
of money in reliance on Seller’s obligations under this Agreement, in
connection with negotiating and executing this Agreement, furnishing the
Earnest Money, conducting the inspections contemplated by this Section 7 and
preparing for Closing, and that Purchaser would not have entered into this
Agreement without the availability of an Inspection Period. The parties
therefore agree that adequate consideration exists to support Seller’s obligations
hereunder, even before expiration of the Inspection Period. Seller and
Purchaser acknowledge that Purchaser has performed various due diligence
activities and inspections with respect to the Projects prior to the date of
this Agreement. Seller and Purchaser agree that the terms and provisions of
this Section 7 apply to and govern such prior activities and inspections.


 


B.            During the
Inspection Period, Purchaser or Purchaser’s agent(s) shall have the right to
perform or cause to be performed or complete a so-called “Phase I”
environmental inspection and assessment (herein referred to as the
“Assessment”) of the Projects, and Seller acknowledges and consents to such
Assessment; provided, however, that no invasive testing (i.e., so-called “Phase
II” environmental inspections) shall be performed without the written consent
of Seller, which consent may be withheld or delayed in Seller’s reasonable
discretion. Purchaser and its consultants shall also have the right to
undertake or complete a technical review of all documentation, reports, plans,
studies and information in possession of Seller, or its past or present
environmental consultants, concerning or in any way related to the
environmental condition of the Projects, excepting any documents classified as
privileged under the attorney-client privilege in connection with pending
environmental litigation. In order to facilitate the Assessment and technical
review, Seller shall extend


 

















 


its reasonable cooperation (but
without third party expense to Seller) to Purchaser and its environmental
consultants, including, without limitation, providing access to all files and
answering all reasonable questions. The Assessment shall evaluate the present
and past uses of the Projects, and the presence on, in or under the Land (and
on, in or under land sufficiently proximate to any of the Projects) of any
Hazardous Materials. Purchaser agrees to engage Carlson Environmental to
perform the assessment of the Projects.


 


C.            Purchaser hereby
covenants and agrees that it shall cause all studies, investigations and
inspections (including, but not limited to, the Assessment), performed at the
Projects pursuant to this Section 7 to be performed in a manner that does not
unreasonably disturb or disrupt the tenancies or business operations of the
Tenants or the operation of any of the Projects. In the event that, as a result
of Purchaser’s exercise of its rights under Section 7A and 7B, any damage
occurs to the Projects, then Purchaser shall promptly repair such damage, at
Purchaser’s sole cost and expense, so as to return the Projects to
substantially the same condition as existed prior to such damage being
incurred. Seller shall have the right, but not the obligation, to have a
representative of Seller present at all times that Purchaser and the Purchaser
Parties perform and conduct any tests, studies or other due diligence
activities in, at, on, under or about the Projects, including, without
limitation, a representative present at any and all conversations and/or
interviews of Tenants of the Projects. If Purchaser exercises its termination
right pursuant to Section 7A hereof, and upon payment for same by Seller to
Purchaser at Purchaser’s cost therefor, Purchaser shall deliver to Seller
promptly upon receipt by Purchaser a true and complete copy of each inspection
report or summary, survey, engineering or architectural study, soil test
report, environmental report or other written result of any such inspection,
investigation, study or test conducted by, on behalf of, or for the benefit and
use of Purchaser. Purchaser agrees that it and all of the Purchaser Parties
shall keep and maintain any and all studies, tests, reports, summaries and
other information relating to the Projects strictly confidential. Prior to
entry onto any Project to conduct or perform any studies, tests,
investigations, surveys, conversations, or any other due diligence activities,
Purchaser and the Purchaser Parties (or each contractor performing such
services for Purchaser the and Purchaser Parties) shall deliver a certificate
of insurance (showing evidence that such party has general liability and other
insurance required by Seller) to Seller naming Seller, Owners, and any other
parties designated by Seller from time to time as additional insureds or loss
payees, as applicable, in amounts, types and form reasonably acceptable to
Seller. Such certificate of insurance shall provide that the insurance
evidenced thereby may not be modified, cancelled or terminated without at least
fifteen (15) days prior written notice to Seller. Purchaser hereby assumes sole
and entire responsibility for any and all loss of life, injury to persons and
damage to property (wherever such property may be located) that may be
sustained, suffered or incurred directly or indirectly due to or on account of
any tests, studies, reviews, inspections and other activities of Purchaser
and/or the Purchaser Parties in, on, at, under and about the Projects or any
portion thereof. Purchaser, for itself and for the Purchaser Parties, hereby
releases Seller, the Owners and their respective affiliates, members, officers,
directors, partners, employees, agents, mortgagees, licensees, tenants,
contractors, guests and invitees (and their respective affiliates, members,
officers, directors, partners, employees, agents, mortgagees, licensees,
contractors, guests and invitees or any tier) (all of the foregoing to be
hereinafter sometimes referred to collectively as the “Seller Group”) from any
and all (a) liability, loss, claim, demand, lien, damage, penalty, fine, interest,
cost and expense (including, without limitation, court costs and reasonable
attorneys’ fees), and (b) damage, destruction or theft of property, that may
arise from, in connection with or during the performance of, any and all tests,
studies, reviews, inspections and other activities of Purchaser and/or any of
the Purchaser Parties in, on, at, under and about the Projects or any portion
thereof; provided, however, that the foregoing release shall not apply with
respect to any of the foregoing caused solely and directly by the acts of
Seller or the Seller Group or any representative thereof. Purchaser hereby
indemnifies,


 

















 


protects, defends and holds
Seller and the Seller Group harmless from and against any and all losses,
damages, claims, causes of action, judgments, costs and expenses (including,
without limitation, court costs and reasonable attorneys’ fees) that Seller
and/or the Seller Group actually suffers or incurs during the course of, or as
a result of, or in any way arising out of, any or all of the studies,
investigations, inspections and other activities (including, but not limited
to, the Assessment), that Purchaser or any of the Purchaser Parties elects to
perform (or causes to be performed) pursuant to this Section 7; provided, however,
that the foregoing indemnity shall not apply with respect to any of the
foregoing caused solely and directly by the acts of Seller or the Seller Group
or any representative thereof. All of Purchaser’s and the Purchaser Parties’
obligations and indemnities under this Section 7 shall survive the Closing or
the termination of this Agreement, whichever shall occur.


 


D.            Purchaser hereby
acknowledges receipt of a copy of that certain Environmental Remediation and
Indemnification Agreement (“Prime Indemnification Agreement”) dated as of
November 17, 1997 by and between Seller, as indemnitee, and The Prime Group,
Inc., as indemnitor, as amended by that certain First Amendment to
Environmental Remediation and Indemnity Agreement dated as of March 20, 2003
and that certain Second Amendment to Environmental Remediation and Indemnity
Agreement dated as of August 28, 2003. Seller shall not assign and Purchaser
shall not accept an assignment of or assume any obligations under the Prime
Indemnification Agreement. Seller and Purchaser shall execute and deliver the
Environmental Escrow Agreement attached hereto and made a part hereof as
Exhibit N with respect to environmental remediation required in connection with
the Chicago, East Chicago and Hammond Enterprise Center Projects.


 


8.             Closing Escrow.


 


A.            The Closing shall be
consummated through one or more Closing Escrows on the Closing Date.


 


B.            At or prior to the
Closing, Seller shall deliver to Purchaser or deposit into the Closing Escrow
the following as to each Project, as applicable, all in form and substance
reasonably satisfactory to Purchaser:


 


(i)            A special warranty deed to Purchaser
or Purchaser’s nominee in recordable form, conveying good and marketable title
to the Real Property in fee simple, subject only to the applicable Permitted
Exceptions.


 


(ii)           A bill of sale executed by Seller
assigning, conveying and warranting to the Purchaser title to the applicable
Personal Property and the applicable Intangible Property, free and clear of all
encumbrances except for Permitted Exceptions, as applicable, and as otherwise
permitted hereby.


 


(iii)          An assignment of the Leases executed
by [(i) the applicable landlords under the Leases to the Seller or applicable
Owner and](ii) Seller or the applicable Owner to Purchaser.


 


(iv)          All original executed Leases (or, if
originals are not available, certified copies thereof).


 


(v)           An Assignment of all Assumed
Contracts, if any, executed by Seller or the applicable Owner to Purchaser.


 


(vi)          Estoppel letters (herein referred to
as “Tenant Letters”) from all Tenants under the Building Leases, including, but
not limited to, the following Tenants: (1) Dynamic Manufacturing; (2) Semblex
Corporation; (3) Windy City Wire & Cable; (4) Plunkett Furniture; (5)
Morton Salt; (6) Boston Coach; (7) Standard Motor Products; (8) Associated
Material Handling; (9) Spraying Systems; (10) Kristel Corp; (11) Household
Credit Services, Inc., (12) Berling Packaging, (13) T


 

















 


Mobile, (14) Illiana Steel,
(15) Electric Coating Technologies, (16) A.M. Castle, (17) Bar Processing, (18)
HECO Equipment Manufacturers, (19) Kreher Steel, (20) Gerdau Ameristeel, (21)
Alpha Processing, (22) Macsteel Service Centers USA, and (23) Amurol (herein
collectively referred to as the “Major Tenants”). Seller shall use commercially
reasonable efforts to obtain Tenant Letters from all Tenants under the Building
Leases. All Tenant Letters shall be addressed to Purchaser or its nominee or
assignee, substantially in the form required under the applicable Building
Lease (with such changes thereto as are reasonably requested by a Tenant or are
required to make a statement factually correct subject to the provisions of
Section 10), or if no form is so required, then substantially in the form of
Exhibit O-1 attached hereto and by this reference incorporated herein. Seller
shall submit the form of Tenant Letter attached as Exhibit O-1 to each Tenant
unless such Tenant’s Lease provides for a different form that does not provide
for “other matters reasonably acceptable” to the Landlord, or other similar
language, in which event Seller shall submit the form required under the
Building Lease, except that notwithstanding the foregoing, Landlord shall
include paragraph 17 of Exhibit O-1 in all Tenant Letters requested.
Notwithstanding the foregoing, if Seller has not obtained Tenant Letters from
all Tenants under the Building Leases, but has obtained Tenant Letters from
Tenants occupying at least 85% of the aggregate square footage of the Buildings
occupied by Tenants as set forth in the Lease Schedule (excluding the space
occupied by Multigraphics, LLC), then Seller shall execute and deliver to
Purchaser a Seller Estoppel Certificate (each, a “Seller Estoppel Certificate”,
and collectively, the “Seller Estoppel Certificates”) substantially in the form
of Exhibit O-2 (with such changes as are required to make the same factually
correct, subject to the provisions of Section 10) with respect to Building
Leases with the remaining Tenants. If Seller shall deliver to Purchaser Seller
Estoppel Certificates and Tenant Letters necessary to satisfy the aforesaid
Tenant Letter threshold, then the Tenant Letter threshold shall be deemed
satisfied, and Purchaser shall have no right to terminate this Agreement on
account of the failure to deliver the required threshold of Tenant Letters.
Furthermore, Purchaser acknowledges and agrees that (1) the limitations on
liability set forth in Section 17C below shall apply to any and all
representations, certifications, assertions and statements made by Seller in
any Seller Estoppel Certificate and (2) any liability of Seller under any
Seller Estoppel Certificate automatically shall fully expire and terminate upon
the earlier to occur of (x) Seller’s delivery to Purchaser of an executed
Tenant Letter in the form required above, and (y) the one (1) year anniversary
of the Closing Date. Any claim that Purchaser may have which is not so asserted
within the aforementioned one (1) year period shall not be valid or effective
and Seller shall have no liability with respect thereto. All Tenant Letters
must be signed and dated no more than forty-five (45) days prior to the date of
Closing. All Seller Estoppel Certificates must be signed and dated no more than
five (5) days prior to the date of the Closing. Notwithstanding the foregoing,
in no event shall Seller be required to deliver Tenant Letters or Seller
Estoppel Certificates from or on behalf of the Tenants under the Farm Leases
nor shall Seller be required to deliver any such documents for the
Multigraphics Lease if Multigraphics LLC has rejected its Lease. Purchaser
acknowledges and agrees that unless and until Multigraphics, LLC assumes its
Lease pursuant to its bankruptcy proceedings, any Tenant Letter or Seller
Estoppel Certificate delivered or obtained with respect to the Multigraphics
Lease may reflect that Multigraphics is in bankruptcy and is in default and
delinquent in the payment of rent under its Lease, and Purchaser acknowledges
and agrees that the disclosure of such facts in the Tenant Letter or Seller
Estoppel Certificate shall in no event constitute a default by Seller or
failure of a condition under this Agreement.


 

















 


(vii)         A letter or letters executed by each
Owner to all the Tenants under the Leases relating to such Owner’s Project
directing the payment of all rental and other payments to Purchaser or its
nominee.


 


(viii)        To the extent not previously delivered,
all architectural drawings, record drawings, plans, specifications, surveys,
building permits, occupancy permits or other similar items in Seller’s possession
(or copies thereof) at its corporate offices which Seller has created, used or
relied upon for the construction and maintenance of the Project.


 


(ix)           All keys (if any) in Seller’s
possession used in connection with the Projects and the combinations known to
Seller to all combination locks included in the Projects.


 


(x)            A non-foreign certificate in
accordance with the provisions of Section 20 hereof.


 


(xi)           An updated Lease Schedule prepared as
of the Closing Date, certified by Seller to be, with respect to the matters
shown thereon, true and correct, in all material respects, as of the Closing
Date.


 


(xii)          A certificate from Seller stating that
its representations and warranties set forth in Section 9 hereof are true and
correct in all material respects as of the Closing Date, with such
modifications to and containing such representations and warranties as are
required to make the same true and correct in all material respects as of the
Closing Date, subject to Section 17 and Section 9D hereof.


 


(xiii)         Any documents or agreements reasonably
required by the Title Company to issue the Title Policy on the Closing Date,
including without limitation an extended coverage owner’s policy statement and
a GAP undertaking.


 


(xiv)        With respect to the Bonds, originals of
any Bond Documents (to the extent not previously delivered), and any and all
documents and instruments reasonably required of Seller or its affiliates in
connection with the Bond Consent and the Bond Release.


 


(xv)         With respect to the CIBC Debt, originals
of any CIBC Documents (to the extent not previously delivered), any and all
documents and instruments reasonably required of Seller or its affiliates in
connection with the CIBC Consent and the CIBC Release.


 


(xvi)        All records of account and such other material
data and documents in Seller’s possession and control as may be reasonably
necessary for Purchaser to continue the operation and maintenance of the
Project.


 


(xvii)       A Rent Subsidy Agreement in the form of
Exhibit P attached hereto.


 


(xviii)      All original Project Contracts (or true
and correct certified copies of same if originals are unavailable).


 


(xix)         Certificates of Insurance for Tenants
verifying compliance with their respective Leases.


 


(xx)          An assignment of intangible property
executed by Seller of the applicable Owner to Purchaser.


 


(xxi)         Proof of authority of Seller and/or the
Owners relating to the execution of the Closing documents.


 

















 


(xxii)        Such documentation as may be required to
obtain any local transfer taxes required in connection with the transactions
contemplated by this Agreement.


 


(xxiii)       Such other documents as Purchaser may
reasonably request to enable Purchaser to consummate each applicable Project
purchase.


 


C.            At or prior to the
Closing, Purchaser shall deliver to Seller or deposit into the Closing Escrow
the following as to any Project that is the subject of such Closing, all in
form and substance reasonably satisfactory to Seller:


 


(i)            The balance of the
Purchase Price, plus or minus prorations.


 


(ii)           Duly executed counterparts of any applicable instruments
of conveyance requiring acceptance by Purchaser.


 


(iii)          Any documents or agreements reasonably required by the
Title Company to issue the Title Policy on such Closing Date, including without
limitation an extended coverage owner’s policy (ALTA) statement.


 


(iv)          With respect to the Bonds (to the extent not previously
delivered) any and all documents and instruments reasonably required in
connection with any new guarantees or collateral required to secure the letters
of credit and/or the release of Seller and its affiliates from all liability
thereunder, including without limitation, the Bond Consent and the Bond
Release.


 


(v)           A certificate from Purchaser stating that its
representations and warranties set forth in Section 11 hereof are true and
correct in all material respects as of the Closing Date, , with such
modifications to such representations and warranties as are required to make
the same true and correct in all material respects as of the Closing Date,
subject to Section 17 hereof.


 


(vi)          With respect to the CIBC Debt (to the extent not previously
delivered) any and all documents and instruments reasonably required in
connection with assumption of the CIBC Debt and an estoppel certificate
substantially in the servicer’s standard form.


 


(vii)         Rent Subsidy Agreement.


 


(viii)        Such other documents as Seller may
reasonably request to consummate the applicable Project sale.


 


D.            At or prior to the Closing, Purchaser and Seller shall
jointly deliver to each other or deposit into the Closing Escrow the following:


 


(i)            Executed state, county and municipal transfer
declarations.


 


(ii)           A closing statement containing calculations of prorations
(the “Closing Statement”).


 


E.             Purchaser and
Seller each agree to execute all of the documents contemplated by this
Agreement to be executed by them to complete the Closing hereunder and such
further documents and instruments and to deliver to each other such further
materials in their possession at the Closing (or thereafter if forgotten at the
Closing or if the need did not become apparent until after the Closing) as may
be reasonably necessary or appropriate to accomplish the purpose and intent
hereof. Additionally, all closing documents to be furnished by the parties
pursuant hereto shall be in form and substance reasonably satisfactory to
Seller, Purchaser and their respective counsels. The parties hereto shall use
reasonable efforts to agree upon the forms of the closing documents promptly
after execution of this Agreement, provided that any failure


 

















 


to agree upon such documents
shall in no event relieve either party of their obligations under this
Agreement. The foregoing obligations shall survive for one (1) year from the
Closing.


 


9.             Representations and
Warranties of Seller.


 


A.            In order to induce
Purchaser to enter into this Agreement, and subject to the terms, provisions
and limitations set forth in Section 9C, Section 9D and Section 17, and except
as set forth in the Exceptions Schedule attached hereto as Exhibit Q and by
this reference incorporated herein (herein referred to as the “Exceptions
Schedule”), Seller represents and warrants to Purchaser that, as of the date of
this Agreement, to Seller’s knowledge (except for items (i), (ii), (vii), (xi),
(xxi), (xxiii), and (xxiv) through (xxix) which shall not be to Seller’s
knowledge except as otherwise expressly set forth in such items):


 


(i)            At the execution hereof and at all
times thereafter through the time of the Closing, each Owner will own its
Project free and clear of all liens, claims, encumbrances and rights of others,
except for the Permitted Exceptions and liens, encumbrances and rights of
others which Seller agrees will be released or bonded or insured over at the
Closing and any matters entered into in accordance with the terms of this
Agreement or otherwise permitted by the terms of this Agreement. No Owner is a
party to any contract, agreement or commitment to sell, convey, assign,
transfer, provide rights of first refusal or other similar rights, or otherwise
dispose of any portion or portions of any Project. Neither the Owners nor any
person or entity claiming by, through or under Owners has or will have, at any
time or times prior to the Closing, done or suffered anything whereby any lien,
encumbrance, claim, or right of others has been or will be created on or
against the applicable Project or any part thereof or interest therein except
for the Permitted Exceptions and liens, encumbrances and rights of others which
Seller agrees will be released at the Closing and any other matters entered
into in accordance with, or permitted by, the terms of this Agreement.


 


(ii)           This Agreement has been duly
authorized and executed on behalf of Seller and constitutes a valid and binding
agreement, enforceable in accordance with its terms, subject however, to (1)
applicable bankruptcy, insolvency, reorganization, moratorium and other similar
laws affecting the rights of creditors generally and (2) the exercise of
judicial discretion in accordance with general principals of equity. Seller has
obtained all consents, releases and permissions and given all required
notifications relating to the transactions herein contemplated and required
under any covenant, agreement, encumbrance, law or regulation to which Seller
is a party or by which Seller is bound, except for the obtaining of consents
and approvals of the servicers and/or holders of the Bonds.


 


(iii)          (1) each Project has adequate water
supply, storm and sanitary sewage facilities, telephone, gas, electricity and
fire protection capacity sufficient to service the applicable Project; (2) the
aforementioned utility services are fully hooked up and operable with respect
to each Project; and (3) all necessary and appropriate approvals for such
utility services have been obtained.


 


(iv)          (1) the Projects, and each Owner’s use
and operation thereof, are in compliance, in all material respects, with all
applicable municipal and other governmental laws, ordinances, regulations,
codes, licenses, permits, and authorizations; and (2) there are presently and
validly in effect all licenses, permits, and other authorizations necessary for
each Owner’s use, occupancy, and operation of the Projects as it is presently
being operated.


 

















 


(v)           (1) all building permits,
certificates of occupancy, business licenses and, without limitation, all other
notices, licenses, permits, certificates and authority required in connection
with the construction, use or occupancy of the Projects have been obtained and
are in effect and good standing; and (2) the leasing, operation and use of the
Projects are in compliance, in all material respects, with such notices,
licenses, permits, certificates and authority.


 


(vi)          there are no unsatisfied written
requests for repairs, restorations or improvements from any person, entity or authority,
including, but not limited to, any Tenant, lender, insurance carrier or
government authority, with reference to any Project, and Seller has not
received any written notice of any claims of any governmental agency to the
effect that the construction, operation or use of any Project is currently in
violation of any applicable Law or that any such claim or any investigation
with respect thereto is under consideration.


 


(vii)         Except as otherwise set forth in the
Lease Schedule or in the Leases, the information in which is true, correct, and
complete in all material respects: (1) each Lease is in effect and the term of
the same and the obligation to pay rent thereunder has commenced and the Tenant
thereunder is in full possession thereof and all tenant improvements required
under the provisions thereof to be constructed by the landlord are completed;
(2) no Tenant under any Lease has prepaid any rent or other charges for more
than one (1) month; (3) to Seller’s knowledge, each Lease is free from default
by the landlord; (4) to Seller’s knowledge, no Tenant is in default under any
Lease; (5) no Tenant is entitled to any rebate, rental concession, free rent
period or set off under any Lease and to Seller’s knowledge, no Tenant is
making any claim against Seller, the Owners, or any Project under any Lease;
(6) all brokers’ commissions with respect to Leases of Projects have been paid
in full and there are no commissions with respect to renewals or extensions of
any Lease; (7) neither Seller nor any agent of Seller has executed any
exclusive brokerage agencies with respect to any Project; (8) there are no
unsatisfied obligations wherein rent and other obligations of any Tenant in
other buildings have been assumed by the landlord or obligations imposed upon the
landlord to take back, sublease or relet such Tenant’s space or any portion
thereof in any Project; (9) no security deposit has been applied toward the
payment of any rent or other charge under any Lease; and (10) none of the
Leases contains any option to purchase or grants the Tenant any right of first
refusal or option to purchase. Each Lease provides for payment of real estate
taxes on an “accrual” or “cash” basis, as applicable, with Tenants making or
not making monthly deposits for same, all as set forth in the Lease. As used
herein, “accrual basis” means payment by a Tenant of real estate taxes
attributed to its period of its Lease or occupancy, regardless of when such
taxes are due and payable, and “cash basis” means payment by a Tenant of real
estate taxes that came due and are payable during the term of its Lease or
occupancy. The Tenants under the Leases for the Projects commonly known as 555
Kirk, 11045 Gage and 1301 Tower are the only Tenants who pay taxes on a cash
basis; the Tenants under all other Leases pay real estate taxes on an accrual
basis.


 


(viii)        Seller has received no written notice
that any of the Project Contracts currently violates in any material respect
any Laws or Permitted Exceptions.


 


(ix)           no Owner is or will, at the Closing,
be in default in respect of any of its material obligations or liabilities
pertaining to such Project (including, but not limited to, such obligations and
liabilities under the Permitted Exceptions, Project Contracts, or Leases).


 

















 


(x)            Except as set forth on the
Exceptions Schedule, there is no litigation pending or threatened, against
Seller, any Owner, or any Project which, if adversely determined, would have a
material, adverse effect on the use and operation of the applicable Project,
except for claims and other matters anticipated to be covered by insurance.


 


(xi)           Except as set forth on the Exceptions
Schedule, no one is employed by any Owner in connection with any Project to
whom any regular wages, overtime pay, vacation pay, accrued sick leave, severance
pay, payroll taxes, withholdings or deposits will be required to be made or
paid, or with respect to whom any W-2 or other forms will be required to be
provided, by such Owner at any time on or after any Closing.


 


(xii)          there are no material physical or
mechanical defects in the condition of any completed Buildings, including, but
not limited to, the roofs, exterior walls or structural components of the
completed Buildings and the heating, air conditioning, plumbing, ventilating,
elevator, utility, sprinkler and other mechanical and electrical systems,
apparatus and appliances located in the Buildings.


 


(xiii)         the Basic Project Information and other
information with respect to Seller and each Project supplied to Purchaser in
connection with and as an inducement to entering into this Agreement, including
the Financial Statements, as of their respective dates, do not and did not
contain any untrue statement of a material fact or omit to state a fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not materially misleading.


 


(xiv)        Seller has received no written notice of
any special assessments of any nature with respect to any Project or any part
thereof, nor has Seller received any written notice of any special assessments
being contemplated.


 


(xv)         all required federal, state, county and
municipal tax returns with respect to each Project have been filed and all
taxes due thereunder have been paid.


 


(xvi)        Seller has received no written notice from
any governmental or regulatory agency of any installation in, or production,
disposal or storage on, any Project of any hazardous waste or other toxic
substances, including, without limitation, asbestos, by Seller, the Owners, and
by any Tenant or previous owner or tenant, and there is no proceeding or
inquiry by any governmental authority or agency with respect thereto.


 


(xvii)       Seller has not received any written
notice from any insurance carrier of material defects or inadequacies in any
Project which if not corrected would result in termination of insurance
coverage, increase its cost or otherwise affect the insurability of such
Project.


 


(xviii)      Seller has received no written notice that
any tenant improvements constructed by Seller with respect to the Projects are
not in accordance with Lease requirements, or are not free of defects in
design, materials or workmanship or deviation from such requests.


 


(xix)         Neither the execution of this Agreement
nor the consummation of the transactions contemplated hereby will violate any
restriction, court order or agreement to which Seller or any Owner or Project
is subject.


 


(xx)          No attachments, execution proceedings,
assignments for


 

















 


the benefit of creditors,
insolvency, bankruptcy, reorganization or other proceedings are pending or
threatened against any Owner, nor are any such proceedings contemplated by any
Owner. Except as otherwise disclosed to Purchaser during the Inspection Period,
no attachments, execution proceedings, assignments for the benefit of creditors,
insolvency, bankruptcy, reorganization or other proceedings are pending or
threatened against any Tenant.


 


(xxi)         Seller has not, and, to Seller’s
knowledge, no previous owner of any Project has, sold, transferred, conveyed or
entered into any agreement regarding “air rights,” “excess floor area ratio” or
other development rights or restrictions relating to any Project, except as may
be disclosed in the Permitted Exceptions.


 


(xxii)        Except as disclosed in the environmental
assessments, reports and other documents listed on Exhibit R attached hereto
and incorporated herein, complete copies of which have heretofore been
delivered to Seller, correspondence or other documents delivered or made
available to Purchaser as part of the Basic Project Information: (1) no
substances, including without limitation, asbestos or any substance containing
more than one-tenth of one percent (0.1%) asbestos, the group of compounds
known as polychlorinated biphenyls, flammable explosives, radioactive
materials, oil, petroleum or any refined petroleum product, chemicals known to
cause cancer or reproductive toxicity, pollutants, effluent, contaminants,
emissions, or related materials and any items included in the definition of
hazardous or toxic waste, materials or substances (all of the forgoing are
herein collectively referred to as “Hazardous Materials” and any mixture of a
Hazardous Material with other materials shall be considered a Hazardous
Material) in an amount actionable under any applicable law relating to environmental
conditions and industrial hygiene, except in accordance with applicable legal
requirements, including without limitation, the Resource Conservation and
Recovery Act of 1976 (herein referred to as “RCRA”), 42 U.S.C.ss.ss.6901 et
seq., the Comprehensive Environmental Response, Compensation and Liability Act
of 1980 (herein referred to as “CERCLA”), 42 U.S.C.ss.ss.9601 et seq., as
amended by the Superfund Amendments and Reauthorization Act of 1986 (herein
referred to as “SARA”), the Hazardous Materials Transportation Act, 49
U.S.C.ss.ss.1801, et seq., the Federal Water Pollution Control Act, 33
U.S.C.ss.ss.1251 et seq., the Clean Air Act, 42 U.S.C.ss.ss.7401 et seq., the
Toxic Substances Control Act, 15 U.S.C.ss.ss.2601-2629, the Safe Drinking Water
Act, 42 U.S.C.ss.ss. 300f et seq., and the similar federal, state and local
environmental statutes, ordinances and the regulations, orders, decrees now or
hereafter promulgated thereunder (such laws are herein collectively referred to
as the “Hazardous Material Laws”), have been installed, used, generated,
manufactured, treated, handled, refined, produced, processed or stored or
otherwise exists in or on any Project or any portion thereof or have been
disposed of or discharged by Seller or from any Project or any portion thereof;
(2) no activity has been undertaken on any Project which would cause: (a) any
Project or any portion thereof to become a hazardous waste treatment, storage
or disposal facility within the meaning of, or otherwise bring such Project or any
portion thereof within the ambit of, RCRA or any other Hazardous Material Law;
(b) a release or threatened release of Hazardous Material from such Project
within the meaning of, or otherwise bring such Project or any portion thereof
within the ambit of, CERCLA, SARA, or any other Hazardous Material Law, or (c)
the discharge of Hazardous Material into any watercourse, body of surface or
subsurface water or wetland, or the discharge into the atmosphere of any
Hazardous Material which would require a permit under any Hazardous Material
Law; (3) no activity has been undertaken with respect to any Project or any
portion thereof which would cause a violation or support


 

















 


a claim under RCRA, CERCLA,
SARA, or any other Hazardous Material Law; (4) no underground storage tanks or
underground Hazardous Material deposits are or were located on any Project or
any portion thereof and subsequently removed or filled; (5) no investigation,
administrative order, litigation or settlement with respect to any Hazardous Materials
is threatened or in existence with respect to any Project or any portion
thereof; (6) no Project has ever been used as a landfill or a waste dump; and
(7) no written notice which remains unresolved has been served on Seller or any
Owner from any entity, governmental body or individual claiming any violation
of any Hazardous Material Law, requiring compliance with any Hazardous Material
Law or demanding payment or contribution for environmental damage or injury to
natural resources.


 


(xxiii)       None of the employees at the Projects are
employed pursuant to a written agreement, and all employees will be terminated
at Closing. None of the employees at the Projects are union employees. No Owner
is a party to, and the Projects are not subject to, any collective bargaining
or other agreement or understanding with any labor union, and is not privy to
or involved in any labor or union controversy or other interaction of any kind.


 


(xxiv)       To the Seller’s knowledge, no default or
event of default now exists under the Indenture of Trust and Financing
Agreements with respect to the Bonds, nor does any condition or event now exist
which, with the giving of notice or the passage of time, or both, would
constitute a default or an event of default under such documents. The Bonds are
rated by a Rating Agency (as said term is defined in the Bond Documents) and
bear interest at the Weekly Rate (as said term is defined in the Bond
Documents). There is no Take-out Lender (as said term is defined in the Bond
Documents).


 


(xxv)        To the Seller’s knowledge, no default or
event of default now exists under the CIBC Documents, nor does any condition or
event now exist which, with the giving of notice or the passage of time, or
both, would constitute a default or an event of default under the CIBC
Documents. Exhibit H contains a list of all CIBC Documents currently in effect,
and Seller has delivered to Purchaser true and correct copies of all of the
CIBC Documents.


 


(xxvi)       The certifications contained in those
certain Borrower’s Closing Certificates dated as of June 30, 1992 delivered
with respect to the issuance of the Bonds and the Illinois Bonds (collectively,
the “Bond Certificates”) are, except as otherwise set forth in this Section
9A(xxvi), true and correct as of the date hereof; provided, however, (i) the
certifications set forth in Sections 1.2(a), 4.2, 4.3, 4.4, 4.5, and 4.6 of
each of the Bond Certificates are true and correct to the best of Seller’s
knowledge; (ii) with respect to the certification set forth in Section 1.4(d) of
each of the Bond Certificates, Prime Group Realty Trust became the sole owner
of all of the outstanding equity interests in each Borrower in December of
1997; (iii) with respect to the certifications set forth in Section 4.1 and 4.2
of each Borrower Certificate, although certain Projects experienced a change in
the identity of the “principal user” or “related person” subsequent to the date
of issuance of the Bonds and the Illinois Bonds, no such change in principal
user or related person caused a violation of the $10 million or $40 million
limits contained in Section 144 of the Code and (iv) the Project owned by
Enterprise Center I, L.P. was destroyed by fire in 1994 and is held as an
unimproved site, available as a “build to suit” for a manufacturing tenant.


 


(xxvii)      The certifications of the respective Owner
contained in (i) those Tax Regulatory Agreements dated June 30, 1992, by and
among the City of Chicago, the respective Owner and Cole Taylor Bank,


 

















 


as trustee, delivered with
respect to the issuance of the Illinois Bonds, and (ii) those Tax Regulatory
Agreements dated June 30, 1992, by and among the Indiana Development Finance
Authority, the respective Owner and NBD Gainer, as trustee, delivered with
respect to the issuance of the Bonds, are true and correct as of the date
hereof and each Owner has complied with their respective covenants contained
therein, provided, however, that the certifications relating to the actions or
omissions of parties other than the respective Owner of the applicable Project
are given to the best of our knowledge.


 


(xxviii)     At all times from the date of issuance of
each issue of Bonds and the Illinois Bonds, the interest on each issue of Bonds
and the Illinois Bonds has been determined based on a Weekly Rate, a Monthly Rate
or an Adjustable Rate for a Rate Period of no greater than six (6) months. The
Borrowers have not taken any action which would cause any of the Bonds or the
Illinois Bonds to be deemed to have been retired and “reissued” pursuant to
Internal Revenue Service Advance Notice 88-130. All defined terms used but not
defined in this paragraph shall have the same meaning as in the Indenture of
Trust, dated as of June 15, 1992, executed in connection with the issuance of
each respective issue of Bonds and the Illinois Bonds.


 


(xxix)       There were no 1992 financial statements
prepared for the partnerships owning the Bond Projects or the Illinois Bond
Projects.


 


B.            References to the
“knowledge” of Seller, and words of similar import, shall refer only to the
actual knowledge of Jeffrey Patterson, Christopher Sultz, Don Anderson or
Jennifer Roloff, without inquiry or due diligence, and shall not be construed,
by imputation or otherwise (whether or not contained in the Basic Project
Information), to refer to the knowledge of Seller, Owners, or any affiliate of
Seller or Owners, any property manager, or any other officer, agent, manager,
representative or employee of Seller, Owners, or any affiliate thereof or to
impose upon the foregoing individual(s) any duty to investigate the matter to
which such actual knowledge, or the absence thereof, pertains. Purchaser
acknowledges and agrees that the individuals named above are named solely for
the purpose of defining and narrowing the scope of Seller’s knowledge, and not
for the purpose of imposing any liability on or creating any duties running
from such individuals to Purchaser or any affiliate, related party, employee,
agent or representative of Purchaser. Purchaser covenants and agrees that it
will bring no action of any nature whatsoever against any of the aforementioned
individuals, or any member, partner, affiliate or shareholder of Seller related
to or arising out of the representations and warranties contained in this
Agreement. Seller shall have no duty to conduct any further inquiry in making
any such representations and warranties.


 


C.            Purchaser
acknowledges that (i) Seller has expended significant time and effort to make
available to Purchaser in the due diligence room at Winston & Strawn LLP
the Basic Project Information, and (ii) Purchaser is in the process of
reviewing all of the Basic Project Information. In preparing the Exceptions
Schedule to Seller’s representations and warranties in this Section 9 and
elsewhere in this Agreement (the “Representations”), Seller has listed those
items from the Basic Project Information that Seller in its good faith
discretion, and based on its Knowledge, deems material to Purchaser’s decision
to purchase the Projects. Purchaser acknowledges that it would not be
practicable for Seller to list on the Exceptions Schedule every non-material
item contained in the Basic Project Information which may be pertinent to the
Representations and that there may be other information in the Basic Project
Information which may also be non-material exceptions to the Representations.
Purchaser agrees to use commercially reasonable efforts to review and make
itself familiar with all of the Basic Project Information. It shall not be a
breach by Seller of a Representation if Seller fails to list information from
the Basic Project Information which (a) is not material to any of the Projects
or (b) which Purchaser becomes aware during its review of the Basic Project


 

















 


Information and nevertheless
consummates the transaction contemplated by this Agreement.


 


D.            As soon as
reasonably practicable after Seller obtains actual knowledge, but in any event
within five (5) business days thereafter, Seller shall notify Purchaser in
writing (a “Correction Notice”) of any material inaccuracy of any of the
Representations (each such inaccuracy, a “False Representation”) and whether
Seller commits to remedy such False Representation by Closing. If Purchaser
receives any Correction Notice which Seller does not commit to remedy by
Closing, Purchaser shall have a period of five (5) business days after receipt
of such Correction Notice during which, in Purchaser’s sole discretion,
Purchaser may terminate this Agreement by written notice to Seller, whereupon
all Earnest Money and accrued interest thereon shall promptly be returned to
Purchaser. In the event that any False Representation consists of a
misstatement by Seller when made, or becomes false because of the subsequent
act or omission of Seller, the foregoing right of Purchaser to terminate the
Agreement shall be without limitation to any other rights or remedies Purchaser
may have under this Agreement. In the event the representation and warranty
became a False Representation due to any reason other than the actions or
omissions of Seller, the foregoing right of Purchaser to terminate this
Agreement shall be Purchaser’s sole and exclusive remedy under this Agreement,
at law and in equity. Notwithstanding the foregoing, Purchaser shall not have
the foregoing right to terminate this Agreement for any False Representation
that Purchaser discovers during the Inspection Period if Purchaser does not
terminate this Agreement within the Inspection Period as provided in Section 7
herein. Notwithstanding anything in this Agreement to the contrary, Seller’s
representations and warranties shall not be rendered untrue or deemed a False
Representation because of (i) the occurrence of a casualty, condemnation or
similar occurrence beyond the reasonable control of Seller, (ii) any change in
applicable law, ordinance, rule or regulation within any municipal, County,
State or other governmental unit, or (iii) any matter which becomes untrue as a
result of any act or omission of the Purchaser. If and when Purchaser discovers
a False Representation, then Purchaser shall have the affirmative duty to
notify Seller of such discovery. In the event that Purchaser fails to so notify
Seller of the discovery of such False Representation within a commercially
reasonable time thereafter, Seller may assert such action or inaction by
Purchaser as a defense thereto.


 


E.             SELLER AND
PURCHASER EACH HEREBY ACKNOWLEDGE AND AGREE THAT THE PROJECTS ARE BEING AND
SHALL BE SOLD, TRANSFERRED, ASSIGNED AND CONVEYED TO PURCHASER, AND THAT
PURCHASER SHALL ACQUIRE AND ACCEPT TITLE TO THE PROJECTS, IN AS-IS WHERE-IS
CONDITION, WITHOUT (EXCEPT TO THE EXTENT OTHERWISE EXPRESSLY PROVIDED IN THIS
AGREEMENT) ANY REPRESENTATIONS OR WARRANTIES OF ANY KIND OR NATURE, EXPRESS OR
IMPLIED, ORAL OR WRITTEN, MADE BY SELLER, ANY OWNER, OR ANY AGENT, ATTORNEY,
EMPLOYEE, MEMBER OR REPRESENTATIVE OF SELLER OR ANY OWNER WITH RESPECT TO THE
PHYSICAL, ENVIRONMENTAL, FINANCIAL OR OTHER CONDITION OF THE PROJECTS, OR WITH
RESPECT TO THE CONSTRUCTION OF ANY IMPROVEMENTS, OR WITH RESPECT TO THE
EXISTENCE OF HAZARDOUS, DANGEROUS OR TOXIC SUBSTANCES, MATERIALS OR WASTES OR
STORAGE TANKS AT, IN, NEAR, UPON OR UNDER ANY OF THE PROJECTS. PURCHASER HEREBY
ACKNOWLEDGES AND AGREES THAT, EXCEPT TO THE EXTENT EXPRESSLY PROVIDED IN THIS
AGREEMENT, NEITHER SELLER OR ANY OWNER, NOR ANY AGENT, ATTORNEY, EMPLOYEE, MEMBER
OR REPRESENTATIVE OF SELLER OR ANY OWNER HAS MADE ANY, AND HEREBY MAKES NO,
WARRANTY OR REPRESENTATION OF ANY KIND, CHARACTER OR NATURE WHATSOEVER, EXPRESS
OR IMPLIED, AND HEREBY DISCLAIMS ANY IMPLIED WARRANTY REGARDING THE FITNESS FOR
PARTICULAR PURPOSE, QUALITY OR MERCHANTABILITY OF THE PROJECTS, AND THAT,
EXCEPT TO THE EXTENT EXPRESSLY PROVIDED IN THIS AGREEMENT, NO RESPONSIBILITY
HAS BEEN OR IS ASSUMED BY SELLER, ANY OWNER, OR ANY PARTY ACTING ON BEHALF OF
SELLER OR ANY OWNER AS TO THE CONDITION OR REPAIR OF ANY OF THE PROJECTS, OR
THE VALUE OF THE PROJECTS, THE EXPENSE OF OPERATION OF THE PROJECTS, OR THE
INCOME POTENTIAL OF THE PROJECTS, OR AS TO ANY OTHER FACT OR CONDITION WHICH
HAS OR MIGHT AFFECT THE PROJECTS, OR THE CONDITION, REPAIR, VALUE, EXPENSE OF
OPERATION OR INCOME POTENTIAL THEREOF. PURCHASER HEREBY ACKNOWLEDGES AND STATES
THAT PURCHASER HAS CONDUCTED OR, PRIOR TO THE CLOSING, WILL HAVE HAD THE
OPPORTUNITY TO CONDUCT, ITS OWN INSPECTION AND INVESTIGATION


 

















 


OF THE PROJECTS, INCLUDING, WITHOUT
LIMITATION, PHYSICAL AND ENVIRONMENTAL INSPECTIONS, TESTS AND STUDIES. FROM AND
AFTER THE DATE OF CLOSING OF THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT,
PURCHASER AGREES TO ASSUME ALL RESPONSIBILITY, LIABILITY AND OBLIGATION FOR THE
PHYSICAL, ENVIRONMENTAL, FINANCIAL AND OTHER CONDITION OF THE PROJECTS, EXCEPT
TO THE EXTENT OTHERWISE EXPRESSLY PROVIDED IN THIS AGREEMENT. PURCHASER
REPRESENTS AND WARRANTS THAT IT IS A KNOWLEDGEABLE, EXPERIENCED AND
SOPHISTICATED PURCHASER OF THE PROJECTS, AND IT IS RELYING SOLELY ON (A)
SELLER’S REPRESENTATIONS AND WARRANTIES EXPRESSLY SET FORTH IN THIS AGREEMENT
AND (B) PURCHASER’S OWN EXPERTISE AND THAT OF ITS CONSULTANTS IN PURCHASING THE
PROJECTS. PURCHASER ACKNOWLEDGES THAT ALL INFORMATION OBTAINED BY PURCHASER
WILL BE OBTAINED FROM A VARIETY OF SOURCES AND THAT, EXCEPT TO THE EXTENT
EXPRESSLY PROVIDED IN THIS AGREEMENT, SELLER WILL NOT BE DEEMED TO HAVE
REPRESENTED OR WARRANTED THE TRUTH OR ACCURACY OF ANY OF MATERIALS OR DUE
DILIGENCE ITEMS OR OTHER INFORMATION PREPARED BY THIRD PARTIES AND NOT ANY
MEMBER OF THE SELLER GROUP AND HERETOFORE OR HEREAFTER FURNISHED TO PURCHASER.
THE TERMS, PROVISIONS, COVENANTS, OBLIGATIONS, AND AGREEMENTS OF PURCHASER SET
FORTH IN THIS SECTION 9E SHALL SURVIVE THE CLOSING OF THE TRANSACTION
CONTEMPLATED BY THIS AGREEMENT.


 


F.             Seller’s capacity
as sole administrative member of Owners shall not affect its personal liability
hereunder and Seller shall be liable as principal and not as agent for any
defaults or breaches of Seller or the Owners hereunder.


 


G.            Subject to the
provisions of this Section 9 and Section 17, except as otherwise provided in
this Agreement, Seller’s covenants, agreements, representations and warranties
contained in this Agreement shall survive the Closing with respect to such
Project for only twelve (12) months after the Closing Date, and thereafter
automatically shall terminate.


 


10.           Conditions Precedent
to Closing.


 


A.            In addition to any
conditions provided in other provisions of this Agreement, Purchaser’s obligation
to purchase the Projects is and shall be conditioned on the following:


 


(i)            that as of Closing, the Tenant
Letters and Seller Estoppel Certificates will not indicate any obligations on
the part of the landlord other than (a) obligations for which Seller has a
reasonable basis for not having performed and provided such obligations would
not cost in excess of $100,000.00 in the aggregate under all of the Leases to
resolve, remedy or cure, as the case may be; (b) costs relating to Tenant
Leases otherwise disclosed by Seller on the Exceptions Schedule; (c) the tenant
allowance for the Household Finance Lease specified in Section 12H; (d) the
Ford Tenant Improvement Costs as specified in Section 12H; (e) the claims
relating to the Plunkett Furniture Lease specified in Section 12J; and (f) the
leasing commission payable in connection with the Multigraphics Lease as
specified in Section 12K;


 


(ii)           subject to Section 10 E, that at no
time prior to any Closing shall any of the following have been done by or against
or with respect to Seller or any Major Tenant and be pending at the time of the
Closing: (1) a proceeding under Title 11 of the United States Code, as now
constituted or hereafter amended, or under any other applicable federal or
state bankruptcy law or other similar law; (2) the appointment of a trustee or
receiver of any property interest; or (3) an assignment for the benefit of
creditors;


 


(iii)          subject to Section 10 E, that as of
the Closing, each Lease shall be in effect and free from monetary or other
material non-monetary default other than (a) defaults disclosed by Seller on
the Exceptions Schedule; (b) monetary defaults by AIM, LLC and Multigraphics
LLC; and (c) any monetary defaults where the applicable rent payment is less
than ten (10) days past due;


 

















 


(iv)          that this Agreement has not been
terminated by Purchaser pursuant to the terms of Sections 14, 15 or 16 below;


 


(v)           the Title Company shall issue the
Title Policy, or a marked commitment therefore, in the form required by this
Agreement;


 


(vi)          in the event the CIBC Debt is being
assumed, Purchaser has received an estoppel certificate with respect to the
CIBC Debt substantially in the debt servicer’s standard form and reasonably
acceptable to Purchaser;


 


(vii)         Purchaser shall have received any and
all third-party consents expressly contemplated by this Agreement, including
without limitation the Bonds and the CIBC Debt (to the extent required
hereunder);


 


(viii)        Purchaser shall have received access
endorsements in form reasonably acceptable to Purchaser with respect to the
11039 Gage Avenue Project and the 11045 Gage Avenue Project; and


 


(ix)           Seller shall have completed to the
reasonable satisfaction of Purchaser all of the repairs specified in the Open
Item List attached hereto and made a part hereof as Exhibit S.


 


B.            In addition to any
conditions provided in other provisions of this Agreement, Seller’s obligation
to sell and transfer, or cause to be sold and transferred, the Projects is and
shall be conditioned on the following:


 


(i)            Purchaser shall have performed, with
respect to the Projects, all of its material covenants, obligations and
agreements hereunder to be performed at or prior to the Closing;


 


(ii)           by the Closing Date, the servicers
and/or lenders relating to the Bonds and the CIBC Debt, in the event that the
CIBC Debt is being assumed, shall have consented to the transfers to Purchaser
contemplated under this Agreement. Seller shall have received the Bond Release,
the CIBC Release (if applicable) and any third-party consents to the
transactions contemplated hereby as may be required by any agreement or
encumbrance to which the applicable Project or Owner is subject; and


 


(iii)          on the Closing Date, there shall not
then be pending any litigation, administrative proceeding, investigation or
other form of governmental enforcement, or executive or legislative proceeding
which, if determined adversely, would restrain the consummation of any of the
transactions herein contemplated or declare illegal, invalid or non-binding any
of the covenants or obligations of the parties herein.


 


C.            Either party may at
any time or times, at its election, waive any of the conditions to its
obligations hereunder, but any such waiver shall be effective only if contained
in a writing signed by such party. Except as otherwise expressly provided in
this Agreement or as provided in any such waiver, no such waiver shall reduce
the rights or remedies of a party by reason of any breach by the other party
(but if a condition is waived, the party waiving the same may not rescind this
Agreement on the basis of the failure of such waived condition). Except as
otherwise expressly provided in this Agreement, in the event that for any
reason any item required to be delivered to a party by the other party
hereunder shall not be delivered when required, then such other party shall
nevertheless remain obligated to deliver the same to the first party, and
nothing (including, but not limited to, the closing of the transaction
hereunder) shall be deemed a waiver by the first party of any such requirement.
The failure of any of the aforesaid conditions set forth in subsection A above
shall entitle Purchaser, at its option, by delivering written


 

















 


notice to Seller on or before
the Closing Date, to cancel and terminate this Agreement without liability and
upon which the Earnest Money shall be returned to Purchaser and neither party
hereto shall have any further obligations hereunder (except for obligations
that, pursuant to the terms of this Agreement, survive the termination of this
Agreement), this Agreement shall be null and void.


 


If any of Seller’s conditions precedent set forth in subsection B above
shall not be satisfied on or before the Closing Date, then Seller shall have
the right, by delivering written notice to Purchaser on or before the Closing
Date, to either (a) terminate this Agreement, in which event Seller and
Purchaser shall have no further obligations under this Agreement, except for
those obligations that, pursuant to the terms of this Agreement, survive the termination
of this Agreement, or (b) waive the requirement that such condition precedent
be satisfied and proceed to close pursuant to the terms of this Agreement. If
this Agreement is terminated on account of the failure of a condition precedent
set forth in subsection B(i) above, then the Earnest Money shall be paid to
Seller.


 


D.            Seller and Purchaser
agree to reasonably cooperate with each other and with any third parties from
whom consent to and approval of the transactions contemplated by this Agreement
is requested to obtain such consents and approvals. Seller and Purchaser agree
to reasonably cooperate with each other and with any third parties relating
obtaining the Alternate Credit Facility and taking an assignment of the CIBC
Debt. Seller and Purchaser shall, each at its respective cost and expense
(except as otherwise provided in this Agreement), deliver, within five (5) days
after request, to any third parties from whom consents and approvals are
requested, any and all information and materials regarding Purchaser and any
affiliates of Purchaser reasonably requested by such third parties. Seller and
Purchaser agree to execute any and all documents reasonably requested by
LaSalle, any servicers and/or holders of the Bonds to effectuate the replacement
of Seller and its affiliates under such documents with Purchaser and/or its
affiliates that are acceptable to LaSalle and such servicers and/or holders.
Seller and Purchaser agree to execute any and all documents reasonably
requested by CIBC and/or servicers of the CIBC Debt to obtain the CIBC Consent
and CIBC Release.


 


E.             Notwithstanding
anything to the contrary in Sections 10A(ii) or 10A(iii), in the event of the
occurrence of any of such events relating to Tenants whose annual gross rent in
the aggregate does not exceed $100,000.00, Purchaser shall not be entitled to
terminate this Agreement and Seller shall deposit in an interest-bearing escrow
(with interest paid to Seller from time to time, but not more frequently than
monthly) with the Escrowee at the Closing an amount equal to one year’s gross
rent under the applicable Lease, to be paid to Purchaser, as successor landlord
under such Lease, for such rents not paid by or collected from any such Tenant
during such one (1)-year period. To the extent, as and when such Tenant pays
such amounts due under its Lease, Purchaser shall direct the Escrowee to pay
such amounts out of said escrow to Seller or Purchaser shall reimburse Seller
for such amounts if Purchaser previously received any such amounts from the
escrow. Purchaser and Seller (and/or the applicable Owner) shall retain the
right to sue any such Tenant for any such delinquent rent, although Seller
(and/or the applicable Owner) shall not have the ability to terminate or
attempt to terminate any Lease or the Tenant’s rights of possession thereunder
in attempting to collect such amounts due. If aggregate delinquent gross rents
exceed $100,000.00, but Purchaser nevertheless closes the transaction, Seller
shall escrow the sum of $100,000.00 at Closing, to be disbursed as provided
aforesaid, but Seller shall have no further liability for such delinquent
rents.


 


F.             Notwithstanding
anything to the contrary in Sections 10A(ii) or 10A(iii), and in addition to
the provisions of Section 10E, if any of the events described in Sections
10A(ii) or 10A(iii) occurs with respect to any Tenant(s) and the aggregate of
(i) in the event of monetary default, the aggregate gross rents due and payable
over the remaining term(s) of such Tenants’ Leases; and


 

















 


(ii) in the event of a material
non-monetary default, the estimated dollar amount reasonably required to cure
such material default, does not exceed $500,000.00, Seller, at its sole option
and in its sole discretion, either (a) with respect to any monetary defaults, guaranty
the payment and performance of such Tenant’s obligations under its Lease for
the full remaining term of any such Lease, or (b) with respect to any material
non-monetary obligation, pay an amount equal to the estimated dollar amount
reasonably required to cure such material non-monetary default, in which event
Purchaser shall not be entitled to terminate this Agreement as a result of any
such disclosures. Notwithstanding the foregoing, (1) Purchaser shall use
commercially reasonable efforts to enforce the terms and provisions of any such
Tenant’s Lease and to collect from such Tenant any amounts paid by Seller to
Purchaser hereunder and (2) in the event Purchaser terminates any Lease that
Seller guaranteed, Purchaser shall use commercially reasonable efforts to lease
such space. In the event Purchaser does lease such space, Seller shall be
entitled to offset any rental income received by Purchaser during the term of
the original Tenant’s Lease (less an amount equal to the costs incurred by
Purchaser in connection with leasing such space multiplied by a fraction, the
numerator of which shall be that portion of the term of the new lease
(excluding any period during which the tenant is not paying rent) which occurs
prior to the expiration of the original Lease guaranteed by Seller and the
denominator of which shall be the entire term of the new lease (excluding any
period during which the tenant is not paying rent)) against amounts payable by
Seller hereunder. If and to the extent Purchaser collects from any Tenant
delinquent rent paid by Seller, or recovers all or any portion of the expenses
paid by Seller for any material non-monetary default, Purchaser shall promptly
remit such amounts to Seller.


 


11.           Representations of
Purchaser. In order to induce Seller to enter into this Agreement, Purchaser
covenants and represents, as the case may be, to Seller that:


 


A.            Purchaser is a real
estate investment trust duly organized, validly existing and in good standing
under the laws of the state of its organization described at the beginning of
this Agreement, and has the requisite power to carry on its business as it is
now being conducted.


 


B.            Purchaser has full
power and authority to enter into and perform this Agreement. The execution,
delivery and performance by Purchaser of this Agreement has been duly
authorized and approved by all requisite action on the part of Purchaser.


 


C.            This Agreement
constitutes a valid and binding obligation of Purchaser, enforceable against
Purchaser in accordance with its terms subject to applicable bankruptcy,
reorganization, insolvency, moratorium, fraudulent conveyance and similar laws
affecting creditors’ rights generally from time to time and to general
principles of equity.


 


D.            Except as required
in connection with the Bond Release and Bond Consent and the CIBC Release and
CIBC Consent, no consent or approval is required from any person in connection
with the execution, delivery and performance by Purchaser of this Agreement.
The execution, delivery and performance by Purchaser of this Agreement will not
cause Purchaser to violate any provisions of its bylaws or trust agreement or
charter or other organizational documents.


 


E.             The individuals
signing this Agreement and all other documents executed or to be executed
pursuant hereto on behalf of Purchaser are and shall be duly authorized to sign
the same on Purchaser’s behalf and to bind Purchaser thereto. Neither the
execution and delivery of this Agreement by Purchaser, the consummation of the
transaction contemplated by this Agreement, nor the compliance by Purchaser
with any of the terms, provisions, covenants and conditions contained in this
Agreement will violate any order, decree, writ, injunction, statute, rule or
regulation to which Purchaser or any of its assets are bound. No consent or
approval by, notice to, or registration with, any


 

















 


person, entity, regulatory
body, administrative agency or other governmental authority is required on
Purchaser’s part in connection with its execution, delivery, and performance of
this Agreement.


 


F.             There is no claim,
action, litigation, proceeding or other governmental investigation pending or,
to Purchaser’s knowledge, threatened or contemplated against Purchaser with
respect to the transactions contemplated by this Agreement or that could
adversely affect Purchaser’s ability to comply with the terms, provisions,
covenants and conditions contained in this Agreement.


 


12.           Adjustments.


 


A.            General. Proration
of rentals, revenues and other income, if any, from the Project and real estate
taxes, assessments, and other expenses, if any, affecting the Property shall be
prorated, without duplication, as of 11:59 p.m. on the day prior to the Closing
Date (herein referred to as the “Proration Date”). It is agreed that the
Closing Date shall be an income and expense date for Purchaser. There shall be
no proration of any insurance premiums with respect to the Project, nor any
assumption of insurance coverage by Purchaser.


 


B.            Rentals. The term
“rentals”, as used herein, includes fixed monthly rentals, additional rentals,
escalation rentals, operating cost pass-throughs and other sums and charges
payable by Tenants under the Leases. Purchaser shall receive all rentals
accruing on and after the Closing Date and Seller shall receive all rentals
accruing prior to the Closing Date, and, at Closing, Purchaser shall receive a
credit on the Closing Statement of all rentals collected by Seller and
attributable to any period following the Closing.


 


C.            Taxes. Seller shall
pay all real estate taxes and assessments on the Projects due and payable as of
the Closing. Seller represents that three (3) of the Tenants, as noted on the
Lease Schedule, pay taxes on a “cash basis” without making monthly deposits,
while the balance of the Tenants pay taxes on an accrual basis and make monthly
estimated deposits. Accordingly, real estate taxes shall be prorated as
follows:


 


(i)            with respect to Tenants paying taxes
on an accrual basis and paying monthly deposits, Purchaser shall receive a
credit for the deposits held by Seller at the Closing for unpaid taxes for the
calendar years 2003 and 2004, and there shall be no further proration;


 


(ii)           with respect to Tenants paying taxes
on a cash basis, there shall be no proration for real estate taxes, however,
Purchaser shall receive a credit for the deposits, if any, held by Seller for
calendar years 2003 and 2004 for the Tenant at the 200 South Mitchell Project
and any other Tenant who, notwithstanding the provisions of the applicable
Lease, is making tax payments on an accrual basis.


 


(iii)          with respect to the Vacant Parcels and
any space in any Project which was vacant during all or any portion of 2003 or
2004, Purchaser shall receive a credit for accrued but unpaid taxes with
respect to such Vacant Parcels and vacant space based upon the actual bills for
such taxes, or if the actual amounts are not available, based upon 102% of the
most recent ascertainable taxes, prorated, in the case of vacant space, for the
period of time such space was vacant.


 


There shall be no reproration of taxes.


 


D.            Prepaid Rentals.
Prepaid rentals, including Tenants’ payments to Seller for Tenants’ shares of
real property taxes and assessments, insurance premiums, common area
maintenance and operation and utilities received by Seller which are unexpended
as of the Closing Date shall be credited to Purchaser as of the Closing Date.


 


E.             Delinquent Rentals.
For purposes of this Agreement, any rentals


 

















 


(whether base rent or
“pass-throughs”) shall be deemed delinquent when payment thereof is due prior
to the Closing Date, but has not been made as of the Proration Date (herein
referred to as “Delinquent Rentals”). Delinquent Rentals shall not be prorated
until collected pursuant to this Section 12E. To the extent either Seller or
Purchaser collects any Delinquent Rentals after the Closing Date, such
Delinquent Rentals shall be first applied to any accrued but unpaid rental
obligations of the tenants at the applicable Project for the period after the
Closing Date and the balance, if any, shall be paid to Seller and credited
against any Delinquent Rentals relating to the period prior to the Closing Date
(herein referred to collectively as “Seller’s Rentals”); provided, however,
notwithstanding any of the foregoing, to the extent any rentals due for the
calendar month in which Closing occurs are received by Seller or Purchaser
after the Closing Date but prior to the first (1st) day of the calendar month
following the calendar month in which Closing occurs, the parties hereby agree
the party who received said rentals shall prorate the same and remit to the
other party, within one (1) business day thereafter, said party’s prorated
portion. Purchaser shall, and shall only be required to, bill Tenants to
collect Delinquent Rentals. Seller shall have the right to pursue and take any
action against any Tenants owing Delinquent Rentals relating to the period
prior to the Closing Date; provided, however, Seller agrees to take no action
which would cause a termination of said tenant’s Lease or affect said tenant’s
right to quiet possession of its premises and Purchaser agrees to cooperate
with Seller, at no cost to Purchaser, in Seller’s attempt to collect any of
Seller’s Rentals.


 


F.             Tenant
Contributions. At the conclusion of each fiscal year relating to periods for
which Seller owned the Projects for all or a portion of such fiscal year,
Seller’s applicable share of common area maintenance charges, taxes and similar
expense reimbursements pursuant to the Leases shall be determined by
multiplying the payments due from or owed to tenants after reconciliation of
estimated payments by a fraction, the numerator of which is the number of
calendar days during said fiscal year in which Seller owned the Projects and
the denominator of which is the total number of calendar days in such fiscal
year (in either case, herein referred to as the “Seller’s Share”). Purchaser
shall remit to Seller or Seller shall remit to Purchaser, as applicable, from
time to time, Seller’s Share within thirty (30) days after Purchaser has
actually collected Seller’s Share or any portion thereof or Purchaser has
notified Seller, in writing that Seller owes any tenant’s under any of the
Leases Seller’s Share (it being acknowledged by Seller, Purchaser shall have no
obligation to remit to Seller’s Share if the same is not collected from the
applicable tenants and any monies collected by tenants with respect to Seller’s
Share shall first be applied by Purchaser to any accrued but unpaid obligations
of the tenant’s thereof accruing from and after the Closing Date).


 


G.            Operating Expenses.
All utility services charges for electricity, heat and air conditioning
service, other utilities, common area maintenance, taxes other than real estate
taxes such as rental taxes, and all expenses incurred in operating the Project
that an Owner pays as opposed to Tenant and any other costs incurred in the
ordinary course of business or the management and operation of the Project,
shall be prorated based on actual charges when final meter readings have been
obtained or actual expenses determined. Seller shall pay all such expenses that
accrue prior to the Closing Date and Purchaser shall pay all such expenses
accruing on and after the Closing Date. To the extent possible, Seller and
Purchaser shall obtain billings and meter readings as of the Closing Date to
aid in such prorations.


 


H.            Leasing Commissions
and Tenant Finish. Except as otherwise set forth herein, Purchaser shall
receive a credit against the Purchase Price for all unpaid leasing commissions
and the costs of all tenant finish work and tenant allowances and other capital
improvement items which are the obligation of Seller with respect to the Leases
executed prior to the date of this Agreement, whether now due or to become due
prior to, on or after the Closing Date (the “Leasing Costs”), Purchaser agrees
to pay, and shall indemnify and hold Seller harmless from and against, any and
all claims for any Leasing Costs for which Purchaser receives a credit at
Closing. Notwithstanding the foregoing, (i)


 

















 


Seller shall give Purchaser a credit
in an amount equal to the outstanding tenant allowance owed in connection with
the Household Finance lease for space at 1301 Tower Road as of the Closing Date
(the “Household Finance Lease”)(together with evidence reasonably satisfactory
to Purchaser as to the amount of such tenant allowance); and (ii) with respect
to the Ford Motor Leases, Purchaser shall give Seller a credit at Closing for a
portion of the tenant finish work and other capital improvement items paid for
by Seller with respect to the Ford Motor Leases (the “Ford Tenant Improvement
Costs”). The credit shall be in an amount equal to the Ford Tenant Improvement
Costs, multiplied by a fraction, the numerator of which shall be the unexpired
term of the applicable Ford Motor Lease (as extended, if applicable) and the
denominator of which shall be the entire term of the applicable Ford Motor
Lease (as extended, if applicable). In the event that Seller has not paid for
the tenant finish work and other capital improvement items with respect to the
Ford Motor Leases at Closing, Seller shall give Purchaser a credit in an amount
equal to the Ford Tenant Improvement Costs, multiplied by a fraction, the
numerator of which shall be the expired term of the applicable Ford Motor Lease
(as extended, if applicable) and the denominator of which shall be the entire
term of the applicable Ford Motor Lease (as extended, if applicable).


 


If Seller and/or any Owner shall pay any Leasing Costs prior to the
Closing Date relating to any New Lease Matter approved or deemed approved by
Purchaser as provided herein executed after the date of this Agreement (the
“New Lease Matter Leasing Costs”), Purchaser shall give Seller a credit at
Closing in an amount equal to the New Lease Matter Leasing Costs, provided,
however, that in the event Seller received any rental income from the Tenant
under such New Lease Matter prior to the Closing Date, such credit shall be
adjusted to equal the New Lease Matter Leasing Costs multiplied by a fraction,
the numerator of which shall be the unexpired term of the applicable New Lease
Matter, and the denominator of which shall be the entire term of the applicable
New Lease Matter less any period of time during which rent is abated under such
New Lease. In the event that Seller has received rental income with respect to
any New Lease Matter but has not paid for the tenant finish work and other
capital improvement items with respect to such New Lease Matter, Seller shall
give Purchaser a credit equal to the New Lease Matter Leasing Costs multiplied
by a fraction, the numerator of which shall be the that portion of the term
during which Seller collected rent with respect to such New Lease Matter and
the denominator of which shall be the entire term of the applicable New Lease
Matter less any period of time during which rent is abated under such New
Lease.


 


I.              Tenant Security
Deposits. Purchaser shall be credited and Seller shall be debited with an
amount equal to all tenant security deposits being held (and not applied) by
Seller or any other person under any of the Leases and any interest, if any,
required to be paid on account thereof, and other deposits as described in
Section 12. If any security deposit(s) is in the form of a letter(s) of credit,
the original letter(s) of credit shall be delivered to Purchaser at Closing in
accordance with the terms and provisions hereof. Prior to Closing, Seller shall
arrange for the transfer or assignment of the letter(s) of credit to the
applicable transferee of each applicable Project. Seller shall arrange for any
and all consents required by the issuing bank(s) for the transfer of the
letter(s) of credit to be obtained prior to Closing. Any and all fees imposed
by such issuing bank(s) in connection with such transfer(s) which are not the
obligation of the applicable tenant to pay shall be paid by Seller. In the
event that any such letter(s) of credit is not transferred or assigned as set
forth above prior to Closing, Seller shall give Purchaser a credit against the
Purchase Price in the amount of the applicable letter(s) of credit. If the
letter(s) of credit is subsequently transferred or assigned to Purchaser,
Purchaser shall promptly refund the amount of the credit to Seller.


 


J.             Plunkett Furniture.
Plunkett Furniture issued a letter in February, 2004 requesting compensation
for one (1) month’s rent for the inconvenience suffered during the roof
replacement project at 200 South Mitchell Court. In the event that the Tenant
Letter from Plunkett Furniture makes reference to the fact that it is entitled
to compensation of one (1) month’s rent for such


 

















 


inconvenience, or in the event
Plunkett Furniture does not deliver a Tenant Letter, Seller shall give
Purchaser a credit at Closing in the amount equal to one (1) month’s rent under
the Plunkett Furniture lease.


 


K.            Multigraphics LLC
Lease. If Multigraphics LLC (f/k/a AM International, Inc.) (or its assignee)
has not assumed its Lease prior to the Closing Date and is delinquent in the
payment of any amounts due and payable under its Lease for any month or portion
thereof after the Closing Date (excluding any amounts which were delinquent on
the Closing Date), Seller shall pay to Purchaser, within ten (10) days of its
receipt of notice from Purchaser that any such monetary default has occurred,
the amount then due and payable (excluding any amounts which were delinquent on
the Closing Date and any interest or penalties owed as a result of such
default, provided Seller shall be responsible for the applicable interest and
penalties on Seller’s late payment in the event Seller does not make such
payment within said ten (10) day period) under the Multigraphics Lease.
Notwithstanding the foregoing, any payments by Seller shall be offset by any
amounts collected by Purchaser as a creditor under the bankruptcy proceedings.
In the event that Multigraphics LLC (or its assignee) assumes its Lease, from
and after such date Seller shall have no further obligations under this Section
12K and, if and to the extent Purchaser collects from Multigraphics LLC monies
in excess of the then current rent payment, any funds for delinquent amounts
previously paid by Seller under this subsection K or owed to Seller as of the
Closing Date, Purchaser shall, within ten (10) days of its receipt of any such
funds, remit such funds to Seller(less, if applicable, Purchaser’s pro rata
share of rent for the month in which the Closing occurs). Any amounts collected
by Purchaser as a creditor under the bankruptcy proceedings shall first be
applied to the amounts owed to Purchaser and then to the amounts due Seller,
with any balance to be retained by Purchaser. In addition to the foregoing, in
the event of an assumption of the Multigraphics LLC Lease, Seller shall, within
ten (10) days of any such assumption, pay to Purchaser an amount equal to the
outstanding leasing commission, if any, due relating to the Multigraphics LLC
Lease. In the event Multigraphics LLC rejects its Lease, (i) Seller represents
and warrants that no commission will be due under the Multigraphics LLC Lease,
and (ii) Purchaser shall use commercially reasonable efforts to lease such
space and Seller’s payments pursuant to this Section 12K shall be offset by any
rentals received by Purchaser (less any costs of reletting) with respect to
such space during the original term of the Multigraphics LLC Lease. The
obligations of Seller and Purchaser set forth in this Section 12K shall survive
the Closing for a period of eighteen (18) months.


 


L.             AIM, LLC. If AIM,
LLC is more than ninety-five (95) days delinquent in the payment of any amounts
due and payable under its Lease as of the Closing Date (excluding de minimis
operating and similar expenses), Seller shall guaranty the payment of base rent
and additional rent due and payable by AIM, LLC under its Lease during the six
(6) month period commencing on the Closing Date and terminating on the date six
(6) months after the Closing Date. In such event, Purchaser shall notify Seller
if and when AIM, LLC fails to pay when due any base or additional rent due and
payable under its Lease for any month or portion thereof after the Closing Date
but prior to the date six (6) months after the Closing Date (excluding any
amounts which were delinquent on the Closing Date), and Seller shall pay such
rent (excluding any interest or penalties) to Purchaser within ten (10) days of
its receipt of such notice. If and to the extent Purchaser collects from AIM,
LLC monies in excess of current rent payments attributable to all or any
portion of the rent paid by Seller pursuant to this Section 12L or owed to
Seller as of the Closing Date, Purchaser shall, within ten (10) days of its
receipt of any such funds, promptly remit such amounts to Seller. All funds
collected from AIM, LLC by Purchaser shall first be applied to amounts owed to
Purchaser and then to the amounts due Seller, with any remaining balance to be
retained by Purchaser. Seller’s obligations under this Section 12L shall
commence, if at all, on the Closing Date and shall terminate on the date six
(6) months after the Closing Date. The obligations of Seller and Purchaser set
forth in this Section 12L shall survive the Closing for a period of one (1)
year.


 

















 


M.           Other Prorations.
Such additional adjustments as are normally made in connection with a purchase
and sale of the type contemplated hereunder.


 


N.            Method of Proration.
Except as expressly provided herein, all apportionments shall be made in
accordance with customary practice in Cook County, Illinois. The parties agree
to cause a schedule of tentative adjustments to be prepared prior to the
Closing Date. Such adjustments, if and to the extent known and agreed upon as
of the Closing Date, shall be paid by Purchaser to Seller (if the prorations
result in a net credit to the Seller) or by Seller to Purchaser (if the
prorations result in a net credit to Purchaser), by increasing or reducing the
amount to be paid by Purchaser at Closing. Purchaser and Seller agree the
intent of this provision is to allocate the income and expenses attributable to
the Project in a fair, just and equitable manner, and the parties agree in the
event of special circumstances not specifically covered herein, such equitable
principles shall guide the parties in reaching a fair resolution. All
prorations hereunder shall be final, unless otherwise expressly provided
hereunder. Any post-closing payment/proration obligations of Seller and
Purchaser set forth in this Section 12 shall survive the Closing for one (1)
year.


 


O.            Bond Adjustments. At the Closing, Seller shall receive a
credit (i.e., addition to) against the Purchase Price, an amount equal to any
and all reserves and escrows maintained pursuant to the Bond Documents.
Purchaser shall receive a credit (i.e., reduction of) against the Purchase
Price in the amount of the Bond Debt, including all accrued interest and other
amounts accrued and unpaid under the Bond Documents.


 


P.             CIBC Adjustments. In the event that the CIBC Debt is
assumed, at the Closing, Seller shall receive a credit (i.e., addition to)
against the Purchase Price, an amount equal to any and all reserves and escrows
maintained pursuant to the CIBC Documents and Purchaser shall receive a credit
(i.e., reduction of) against purchase price in the amount of the CIBC Debt,
including all accrued interest and other amounts accrued under the CIBC
Documents other than costs Purchaser has agreed to pay under this Agreement. In
the event that the CIBC Debt is defeased, Purchaser shall receive a credit
(i.e., reduction of) against purchase price in the amount of the CIBC Debt,
including all accrued interest and other amounts accrued under the CIBC
Documents, other than costs Purchaser has agreed to pay under this Agreement,
including, but not limited to, any costs associated with the defeasance of the
CIBC Debt.


 


13.           Closing Costs. Except to the extent set forth below as a
Purchaser cost, Seller shall pay all title charges and expenses of or relating
to the Title Policies herein provided for including commitment fees, any
endorsements (up to $500.00 per Project) and endorsements over unpermitted
title exceptions, and title insurance premiums, Survey fees, one-half (1/2) of
all Closing Escrow fees, State and County documentary or transfer taxes,
municipal transfer taxes imposed by ordinance on Seller, any sales or
transaction tax payable by reason of the transaction herein described, and all
other closing costs and expenses (other than the expenses to be paid by
Purchaser as hereinafter provided) customarily paid by sellers of property in
the Chicagoland area. The expense of Purchaser’s attorneys and consultants,
one-half (1/2) of the Closing Escrow fees, all fees and costs relating to
obtaining the Bond Consent, the Bond Release, the CIBC Consent and the CIBC
Release, all fees and costs relating to the prepayment of all Non-Assumed Debt,
all due diligence costs and expenses, the costs of any endorsements requested
by Purchaser (in excess of $500.00 per Project and other than those relating to
unpermitted title exceptions) to the Title Policy, fees for recording deeds,
and any municipal transfer taxes imposed by ordinance on Purchaser, all costs related
to lenders title insurance policies and all other costs customarily paid by
purchasers of property in the Chicagoland area shall be paid by Purchaser. [At
Closing or upon termination of this Agreement, Purchaser shall reimburse Seller
for the costs of the sprinkler, backflow and alarm tests requested by Purchaser
in connection with its due diligence (to the extent such expenses cannot be
passed through to the Tenants


 

















 


of the applicable Project).


 


14.           Covenants of Seller. Seller hereby covenants with
Purchaser as follows:


 


A.            From the full execution hereof until the Closing Date or
the date that this Agreement is terminated, whichever shall occur, Seller shall
neither amend any Lease, execute any new lease, license, or other agreement
affecting the ownership or operation of the Projects or for personal property,
equipment, or vehicles (as applicable, a “New Lease Matter”) without
Purchaser’s prior written approval (which approval shall not be unreasonably
withheld or delayed and shall be deemed given if not disapproved in writing
within five (5) business days following Seller’s written request for approval).
Purchaser may not object to the Seller’s entry into any New Lease Matter that
is commercially reasonable. For purposes of this Agreement, the Ford Motor
Company Lease dated as of June 23, 2004, and the Ford Motor Lease dated as of
June 30, 2004 (collectively, the “Ford Leases”) shall each be deemed to be a
New Lease Matter approved by Purchaser.


 


B.            From the full execution hereof until the Closing Date or
the date that this Agreement is terminated, whichever shall occur, Seller shall
not enter into any contract with respect to the ownership and operation of the
Projects that will survive the Closing, or that would otherwise affect the use,
operation, or enjoyment of any of the Projects after the Closing Date (as
applicable, a “New Contract Matter”), without Purchaser’s prior written consent
(which shall not be unreasonably withheld or delayed), except for service
contracts entered into in the ordinary course of business which are terminable
without penalty on not less than thirty (30) days’ notice. If Purchaser’s
approval of any contract is requested, such approval shall be deemed given if
not disapproved in writing within five (5) business days following Seller’s
request for approval. Purchaser may not object to the Seller’s entry into any
New Contract Matter that is commercially reasonable.


 


C.            Seller shall, from and after the full execution hereof
until the Closing Date or the date that this Agreement is terminated, whichever
shall occur: (i) cause the Projects to be operated and managed in substantially
the manner currently being operated, maintaining present services (including,
but not limited to, pest control), and shall cause the Projects to be
maintained substantially in the same condition as exists as of the date of this
Agreement, normal wear and tear, fire and other casualty excepted; (ii) keep on
hand sufficient materials, supplies, equipment and other personal property for
the efficient operation and management of the Projects as currently being
managed; (iii) cause to be performed, when due, all of the Owners’ material
obligations under the Leases, Project Contracts, and other agreements relating
to any of the Projects and otherwise in accordance in all material respects
with applicable laws, ordinances, rules and regulations affecting any of the
Projects; and (iv) cause compliance with the Bond Documents and CIBC Documents
and maintain full replacement cost casualty insurance on all of the Buildings.
Except as otherwise specifically provided herein, the Projects shall be
delivered at Closing in substantially the same condition as exists on the date
hereof, reasonable wear and tear, fire and other casualty excepted. None of the
Personal Property, fixtures or inventory essential to the use and operation of
the Projects shall be removed from the Projects, unless replaced by personal
property, fixtures or inventory of equal or greater utility and value.


 


D.            Upon obtaining knowledge thereof, Seller shall promptly
notify Purchaser of any material change in any physical condition with respect
to the Projects or of the occurrence of any event or circumstance that makes
any representation or warranty of Seller to Purchaser under this Agreement untrue
or misleading in any material respects, or any material covenant of Purchaser
under this Agreement incapable or less likely of being performed.


 


E.             Seller shall cause the Owners to continue to make all
payments under and otherwise comply with all of the provisions of the Bond
Documents and the


 

















 


Non-Assumed Debt, and shall
deliver to Purchaser copies of any material notices received thereunder by
Seller or any Owner.


 


15.           Damage or Destruction to Any Project. In the event that
between the date of this Agreement and the Closing Date, all or any portion of
any Project is damaged or destroyed by fire or other casualty, and no Tenant
that leases more than 15,000 square feet of space with respect to such Project
has the right to terminate its Lease as a result thereof, then Purchaser shall
consummate the transaction contemplated hereby. In such event, Seller (and/or
the applicable Owner) shall credit or pay to Purchaser the reasonable and
customary restoration costs for the Project. In such event, Seller shall be
entitled to receive all insurance proceeds payable with respect to such damage
or destruction, whether or not such proceeds are paid prior to Closing. If a
Tenant that leases more than 15,000 square feet of space has the right to
terminate its lease on account of such damage or destruction, then Purchaser
may elect, by delivering notice thereof to Seller within ten (10) days after
Seller delivers to Purchaser notice of such damage (and if the Closing Date is
scheduled to occur prior to the expiration of such ten (10) day period, then
the Closing Date shall be extended until the expiration of such ten (10) day
period), to terminate this Agreement, in which event the Earnest Money shall be
returned to Purchaser and neither Seller nor Purchaser shall have any further
rights or obligations under this Agreement (except for those obligations that,
pursuant to the terms of this Agreement, survive the termination of this
Agreement). Purchaser’s failure to deliver a termination notice as provided
above shall be deemed Purchaser’s election to waive its termination rights
under this Section 15A with respect to the applicable damage or destruction,
and Seller (and the applicable Owner) shall, at Closing, credit or pay to
Purchaser the restoration costs for the Project. Seller in no event shall have
any obligation to repair or restore any damage to any Project caused by fire or
any other casualty.


 


16.           Condemnation. In the event that between the date of this
Agreement and the Closing Date any condemnation or eminent domain proceedings
are initiated which would result in the taking of any Project or portion
thereof which would allow a Tenant leasing in excess of 15,000 square feet with
respect to such Project to terminate its Lease, Purchaser, at its sole option,
may elect to terminate this Agreement by delivering notice of such termination
to Seller within ten (10) days after Seller’s delivery to Purchaser of notice
of such condemnation or eminent domain proceedings, in which event the Earnest
Money shall be returned to Purchaser and neither Seller nor Purchaser shall
have any further rights or obligations hereunder (except for obligations that,
pursuant to the terms of this Agreement survive the termination of this
Agreement). In the event that Purchaser is not entitled to terminate this
Agreement as aforesaid or elects not to so terminate this Agreement, Purchaser
shall consummate the transaction contemplated by this Agreement and Seller
shall assign to Purchaser at Closing all of Seller’s title and interest in and
to any award pertaining to the applicable Project made in connection with such
condemnation or eminent domain proceedings. If Purchaser fails to notify Seller
of its election within said 10-day period, such failure shall constitute an
election to waive its termination rights under this Section 16 with respect to
such condemnation or eminent domain proceeding.


 


17.           Remedies.


 


A.            Purchaser Remedies. In the event Seller defaults in any
of its obligations under this Agreement and fails to cure such default within
fifteen (15) days after written notice of such default from Purchaser, then
Purchaser may, as its sole and exclusive remedies, either (i) enforce specific
performance of this Agreement against Seller, (ii) terminate this Agreement by
written notice to Seller and the Title Company, in which event the Earnest
Money and all interest accrued thereon shall be returned to Purchaser, or (iii)
if specific performance is not available, or if Seller has intentionally caused
a breach of a representation or warranty as set forth in Section 9D, Purchaser
may sue for damages, subject to Section 17D hereof. If Purchaser fails to file
suit for specific performance against Seller, or to file suit for damages if
clause (iii)


 

















 


of the preceding sentence is
applicable, in a court having jurisdiction on or before ninety (90) days
following the date upon which Closing was to have occurred, then Purchaser
shall be deemed to have elected to terminate this Agreement and receive back
the Earnest Money and all interest accrued thereon.


 


B.            Post-Closing
Purchaser Remedies. If after Closing Purchaser discovers that any of Sellers’
representations or warranties were not true or correct in any material respect,
or that Seller breached or defaulted with respect to any other covenant to be
performed by Seller hereunder, then Purchaser shall have the right to sue
Seller for damages, subject to Section 17D hereof.


 


C.            Seller Remedies. In
the event Purchaser defaults in any of its obligations under this Agreement and
fails to cure such default within fifteen (15) days after written notice of
such default from Seller, then Seller’s sole and exclusive remedy shall be to
cause the Escrowee to deliver the Earnest Money, together with all interest
earned thereon, to Seller, the amount thereof being fixed and liquidated
damages, it being understood that Seller’s actual damages in the event of such
default are difficult to ascertain and that such proceeds represent the
parties’ best current estimate of such damages. Notwithstanding the foregoing,
the other provisions of this Agreement shall in no manner limit or restrict
Purchaser’s indemnity obligations and liabilities under this Agreement,
including, without limitation, its obligations under Sections 7, 11H, 17G, 18
and 29 hereof.


 


D.            Limitations on Purchaser
Remedies. Purchaser agrees that if it at any time discovers that any of
Seller’s representations or warranties contained in this Agreement have been
violated or breached, or that Seller has breached any other of the material
covenants and conditions herein to be performed by Seller, then Purchaser
immediately shall notify Seller of same. Notwithstanding anything to the
contrary contained in this Section 17 or elsewhere in this Agreement, Purchaser
acknowledges and agrees that Seller’s liability for any and all damages,
losses, costs, expenses and/or injuries sustained, suffered or incurred by
Purchaser or any affiliate thereof or related person or party thereto as a
result of any violation, breach or default by Seller of any of the terms,
provisions, covenants, agreements, representations or warranties of Seller set
forth in this Agreement, and any claim that Purchaser may have at any time
against Seller for any such violation, breach or default shall be subject to
and limited by the following:


 


(i)            Seller shall have no liability to
Purchaser or any party acquiring any of the Projects pursuant to this Agreement
unless and until Seller shall have received from Purchaser written notice
specifying (1) in detail, a violation, breach, or default of any of the
covenants, representations or warranties of Seller set forth in this Agreement,
and (2) either (a) documentation reflecting the amount of actual, out-of-pocket
loss, cost, expense, damage, and/or injury claimed to have been sustained,
suffered. or incurred by Purchaser and/or such other party as a direct result
of such violation, breach, or default or, if applicable, (b) as to any damages
or losses that in Purchaser’s reasonable opinion cannot be actually incurred
until more than one (1) year from the Closing or the time of discovery after
the Closing, if applicable, a written contractor’s estimate of the costs
necessary to cure such violation, breach, or default, which written notice and
estimate must be received by Seller on or prior to the date that is twelve (12)
months after the Closing Date of the applicable Project or the time of
discovery after the Closing, if applicable. If Seller disputes such estimate,
Seller shall obtain its contractor’s own estimate and, if the two (2) estimates
differ by 10% or less, the average of the two (2) shall be deemed approved. If
the two (2) estimates differ by more than 10%, than the estimating parties
(i.e., Seller’s and Purchaser’s contractors) shall agree on a third party,
whose estimate shall be binding, and shall take into account, among other
items, both Seller’s and Purchaser’s contractors’ estimates. Once


 

















 


the estimate has been
approved or deemed approved, and Purchaser has submitted documentation
reflecting its actual loss, cost, expense, damage, and/or injury, Seller shall
pay to Purchaser the amount thereof within five (5) business days, and Seller
shall be fully, forever, and irrevocably released of any and all liability,
cost, expense, damage, etc., with respect to the applicable matter (and
Purchaser agrees to execute a release agreement).


 


(ii)           Seller shall have no liability to
Purchaser or any party acquiring any of the Projects pursuant to this Agreement
unless the actual, out-of-pocket damages, losses, costs, expenses, or injuries
incurred or estimated to be incurred are in excess (in the aggregate with
respect to all of the Projects) of $125,000.00 (and in such event Seller only
shall be liable for the portion of such actual, out-of-pocket damages, losses,
costs, expenses and injuries in excess of $125,000.00), subject, however, to
the other limitations set forth herein;


 


(iii)          Seller in no event shall be liable to
Purchaser or any party acquiring any of the Projects pursuant to this Agreement
for any punitive or consequential losses or damages;


 


(iv)          Seller shall have no liability to
Purchaser or any party acquiring any of the Projects pursuant to this Agreement
for any damages, losses, costs, expenses or injuries sustained, suffered or
incurred by Purchaser and/or such other party in excess (in the aggregate with
respect to all of the Projects) of $6,000,000;


 


(v)           if, at any time prior to the Closing,
Purchaser or any of its employees discovers that any representation or warranty
made by Seller in this Agreement, or any other information delivered by Seller
to Purchaser in respect to any such Projects, is inaccurate, untrue or
incorrect in any manner or respect when made, or that Seller has violated any
of its covenants or agreements in this Agreement, but Purchaser nevertheless
closes the transaction contemplated by this Agreement, then only in the event
Purchaser fails to notify Seller of same prior to the Closing, Purchaser and
any party acquiring any Project pursuant to this Agreement shall be deemed to
have waived any and all rights, remedies, claims, or suits against Seller
related to and released Seller from any and all loss, damage, injury,
liability, cost, and/or expense sustained, suffered, or incurred by Purchaser
and/or such other party on account of any such inaccurate, untrue, or incorrect
representation, warranty, or information, or violation of such covenant or
agreement, in the event that Purchaser or any of its agents, employees,
representatives, consultants, or any other parties notifies Seller as provided
above of the specific details regarding such breach or violation, no rights,
remedies, claims, or suits shall be waived or released; and


 


The terms, provisions and limitations set
forth in this Section 17D shall survive the Closing without limitation.


 


E.             Litigation Costs.
In the event of litigation between the parties with respect to the Projects,
this Agreement, the performance of their respective obligations hereunder or
the effect of a termination under this Agreement, the losing party shall pay
all costs and expenses incurred by the prevailing party in connection with such
litigation, including, but not limited to, reasonable attorneys’ fees of
counsel selected by the prevailing party. For the purposes of this subsection
E, the “prevailing party” shall be deemed to be the party that, in an
adversarial proceeding, is awarded damages or other relief substantially equal
to the relief sought by such party, or that successfully defends such
proceeding, or that dismisses an action for recovery under this Agreement in
exchange for payment of the sums allegedly due, performance of covenants
allegedly breached or consideration substantially equal to the relief 


 

















 


sought in the action.
Notwithstanding any provision of this Agreement to the contrary, the
obligations of the parties under this Section 17 shall survive the termination
of this Agreement.


 


F.             Time to File Suit.
Notwithstanding anything to the contrary in this Section 17, if Purchaser fails
to file suit for specific performance against Seller or to file suit for
damages in a court having jurisdiction, as provided aforesaid, on or before
ninety (90) days following the date upon which Closing was to have occurred,
then Purchaser shall be deemed to have elected to terminate this Agreement and
receive back the Earnest Money and all interest accrued thereon.


 


18.           Brokers. The parties
mutually warrant and represent to the other that neither has authorized any
broker to act on its behalf in respect of the transactions contemplated hereby,
and that neither has dealt with a broker in connection therewith. Each of the
parties shall indemnify and save the other party harmless from any claim by any
broker or other person for commissions or other compensation for bringing about
the transactions contemplated hereby where such claim is based on the purported
employment or authorization of such broker or other person by such indemnifying
party.


 


19.           Entire Agreement. It
is understood and agreed that all understandings and agreements heretofore had
between the parties hereto are merged in this Agreement, the exhibits annexed
hereto and the instruments and documents referred to herein, which alone fully
and completely express their agreements, and that neither party is relying upon
any statement or representation not embodied in this Agreement made by the
other. Each party expressly acknowledges that, except as expressly provided in
this Agreement, the other party and the agents and representatives of the other
party have not made, and the other party is not liable for or bound in any
manner by, any express or implied warranties, guaranties, promises, statements,
inducements, representations or information pertaining to the transactions
contemplated hereby. The preparation of this Agreement has been a joint effort
of the parties hereto and the resulting documents shall not, solely as a matter
of judicial construction, be construed more severely against one of the parties
than the other.


 


20.           Non-Foreign
Certificate. Seller shall provide Purchaser, on or before the Closing Date,
with a non-foreign certificate sufficient in form and substance to relieve
Purchaser of any and all withholding obligations under federal law, which
certificate shall be reasonably satisfactory to Purchaser and the Title
Company.


 


21.           Modifications. No
modification, amendment, discharge or change of this Agreement, except as
otherwise provided herein, shall be valid unless the same is in writing and
signed by the party against which the enforcement of such modification,
amendment, discharge or change is sought.


 


22.           Notices. All notices,
demands, requests and other communications under this Agreement shall be in
writing and shall be deemed properly served (i) when received (or refusal of
receipt) if delivered by hand or expedited messenger service with proof of
receipt to the party to whose attention it is directed or (ii) one (1) business
day after deposit with an overnight courier service if sent by recognized
overnight courier service, addressed as follows:


 


	
  If intended for Seller:

  	
   

  	
  c/o Prime Group Realty
  Trust

  77 West Wacker Drive

  Suite 3900

  Chicago, Illinois 60601

  Attention: Mr. Jeffrey A. Patterson

  
	
   

  	
   

  	
   

  
	
  with a copy to:

  	
   

  	
  c/o Prime Group Realty
  Trust

  77 West Wacker Drive

  Suite 3900

  



 

















 


	
   

  	
   

  	
  Chicago, Illinois 60601

  Attention: James F. Hoffman, Esq.

  
	
   

  	
   

  	
   

  
	
  If intended for Purchaser:

  	
   

  	
  CenterPoint Properties
  Trust

  1808 Swift Drive

  Oak Brook, Illinois 60523

  Attention: Mr. Michael M. Mullen

  
	
   

  	
   

  	
   

  
	
  with a copy to:

  	
   

  	
  Weinberg Richmond LLP

  333 West Wacker Drive

  Suite 1800

  Chicago, Illinois 60606

  Attention: Mark S. Richmond, Esq.

  



 


or such other address or to such other party
which any party entitled to receive notice hereunder designates to the others
in writing by a notice duly given hereunder.


 


23.           Governing Law and
Interpretation. The validity, meaning and effect of this Agreement shall be
determined in accordance with the laws of the State of Illinois applicable to
contracts made and to be performed in that state. The terms “hereby”, “hereof”,
“hereto”, “herein”, “hereunder” and any similar terms shall refer to this
Agreement, and the term “hereafter” shall mean after, and the term “heretofore”
shall mean before, the date of this Agreement. Words of the masculine, feminine
or neuter gender shall mean and include the correlative words of other genders,
and the words importing the singular number shall mean and include the plural
number and vice versa. Words importing persons shall include firms,
associations, partnerships (including limited partnerships), trusts,
corporations and other legal entities, including public bodies, as well as
natural persons. The terms “include”, “including” and similar terms shall be
construed as if followed by the phrase “without being limited to”.


 


24.           Counterparts. This
Agreement may be executed in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument.


 


25.           Captions. The
captions in this Agreement are inserted for convenience of reference only and
in no way define, describe or limit the scope or intent of this Agreement of
any of the provisions thereof.


 


26.           Binding Effect.
Subject to the terms and restrictions of Section 35 below, this Agreement shall
be binding upon and shall inure to the benefit of the parties hereto and their
respective successors and assigns.


 


27.           Partial Invalidity. Seller
and Purchaser intend and believe that each provision in this Agreement comports
with all applicable local, state and federal laws and judicial decisions.
However, if any provision or provisions in this Agreement which is or are not
materially related to the liability of the parties hereto or to the conditions
to Purchaser’s and/or Seller’s obligations to consummate the transaction
contemplated herein is found by a court of law to be in violation of any
applicable local, state or federal ordinance, statute, law, administrative or
judicial decision, or public policy, and if such court should declare such
portion, provision or provisions of this Agreement to be illegal, invalid,
unlawful, void or unenforceable as written, then it is the intent both of Seller
and Purchaser that such portion, provision or provisions shall be given force
to the fullest possible extent that they are legal, valid and enforceable, that
the remainder of this Agreement shall be construed as if such illegal, invalid,
unlawful, void or unenforceable portion, provision or provisions were not
contained therein, and that the rights, obligations and interest of Purchaser
and Seller under the remainder of this Agreement shall continue in full force
and effect. If any provision or provisions which is or are material as set
forth above are found to be illegal, invalid, unlawful, void or unenforceable
as written, this Agreement may, at the option of either party, be terminated
without further obligation to either party.


 

















 


28.           Time for Performance.
Time is of the essence of this Agreement. Whenever under the terms of this
Agreement the time for performance falls on a Saturday, Sunday or Legal
Holiday, as defined in 205 ILCS 630/17 as amended, such time for performance
shall be on the next day that is not a Saturday, Sunday or Legal Holiday. In
computing any period of time pursuant to this Agreement, the day of the act or
event from which the designated period of time begins to run will not be
included and the last day of such period will be included.


 


29.           Illinois Income Tax
Withholding. At least five (5) days prior to the Closing, Seller shall deliver
to Purchaser evidence that the sale of the Project to Purchaser hereunder is
not subject to, and does not subject Purchaser to liability under, 35 ILCS
5/902 (d) or 35 ILCS 120/5j (“Act”) and that at least fifteen (15) days prior
to the Closing, Seller shall have notified the Illinois Department of Revenue
(herein referred to as the “Department”) of the intended sale and requested the
Department to make a determination as to whether the Seller has an assessed,
but unpaid, amount of tax, penalties, or interest under the Act. In the event
any amounts are indicated as being unpaid, Seller shall deliver to Purchaser a
personal indemnification executed by Prime Group Realty, L.P. indemnifying and
holding Purchaser harmless from any loss, cost or damage resulting from any
Illinois tax due, or claimed to be due, from Seller.


 


30.           Audit and
Indemnification. In the event anytime within three (3) years subsequent to the
Closing Date Purchaser desires to have its independent auditors audit the
operating results of a Project for the period required under then current
Securities and Exchange Commission (“SEC”) regulations (herein referred to as
the “Relevant Period”), Seller, at Purchaser’s cost and expense, agrees to
provide to Purchaser’s designated independent auditors (i) access to the books
and records of the Projects for the Relevant Period and (ii) a letter stating
only that said books and records were prepared by Seller in the ordinary course
of business for its internal purposes. Purchaser hereby agrees to forever
indemnify, defend and hold harmless Seller from and against any claim, damage,
loss, liability cost or expense (including reasonable attorneys’ fees and court
costs) to which Seller is at anytime subjected by any party as a result of
Seller’s compliance with the terms and conditions of this Section 30. Purchaser
further agrees that no information, books or records provided pursuant to this
Section 30 shall be the basis of any claim by Purchaser against Seller with
respect to the sale of a Project to Purchaser or any representation, warranty
or covenant given by Seller with respect to a Project.


 


31.           Recording. Seller
and Purchaser agree that neither this Agreement nor any memorandum or summary
of this Agreement shall be recorded without the prior written consent of the
other party, which consent may be granted or withheld in such other party’s
sole and absolute discretion. If Purchaser causes this Agreement or any notice
or memorandum hereof to be recorded, then without limitation of Seller’s other
remedies for such default, this entire Agreement shall be null and void at the
option of the Seller and Seller shall be entitled to be paid the entire Earnest
Money.


 


32.           Confidentiality.
Seller and Purchaser acknowledge and agree that the transactions contemplated
by this Agreement are of a highly sensitive and confidential nature and, except
to the extent disclosure is required by law or is otherwise permitted by this
Section 32, Purchaser and Seller agree that all documents and information
concerning the Projects, the subject matter of this Agreement, and all
negotiations with respect hereto and the subject matter hereof shall remain
confidential. Prior to and after the Closing, any release or disclosure to the
public of information with respect to the transaction so closed, any matters
set forth in this Agreement, or any of the terms and provisions of this
Agreement shall be made only in the form approved by Purchaser and Seller and
their respective counsels (which approval shall not be unreasonably withheld or
delayed, and shall be deemed to have been granted if not expressly disapproved
within one (1) business day after request for approval). Notwithstanding the
foregoing to the contrary, this Section 32 shall


 

















 


not prevent (a) either party
from disclosing any information with respect to the transactions contemplated
herein, any matters set forth in this Agreement, or any of the terms and
provisions of this Agreement if and to the extent that such disclosure is
reasonably determined by such party to be required by applicable law or a court
or other binding order or by applicable administrative rule or regulation or
order of any regulatory or supervisory agency or authority with competent
jurisdiction over such matter; (b) Seller or Purchaser from disclosing any
information with respect to the transactions contemplated herein, any matters
set forth in this Agreement, or any of the terms and provisions of this
Agreement to any of their respective current or prospective lenders, members,
officers, directors, trustees, employees, consultants, attorneys, accountants,
advisors, agents, representatives, partners ,and/or shareholders and/or any
parties whose consent is required (and any of the respective lenders, members,
officers, directors, trustees, employees, consultants, advisors, agents,
representatives, partners, and/or shareholders of any of such parties);
provided that all of the foregoing to whom disclosure is made are advised of
the confidential nature of such information, matters, terms and provisions; or
(c) the Owners, Seller, and/or its member, its member’s members, and/or Prime
Group Realty Trust or Purchaser from making any public statement, filing, or
other disclosure which any of them reasonably believes to be required or
desirable under applicable securities laws or in connection with any securities
offering or registration by the Owners, Seller, and/or its member, its member’s
members and/or Prime Group Realty Trust or Purchaser, or as may be requested or
required by the New York Stock Exchange or other securities market. The
provisions of this Section 32 shall survive the Closing or termination of this
Agreement (whichever shall occur) without restriction or limitation.


 


33.           Further Assurances.
Each party hereto agrees that it will without further consideration execute and
deliver such other documents and take such other action, whether prior or
subsequent to the Closing, as may be reasonably requested by the other party to
consummate more effectively the purposes or subject matter of this Agreement.
Without limiting the generality of the foregoing, Purchaser shall, if requested
by Seller, execute acknowledgments of receipt with respect to any materials
delivered by Seller to Purchaser with respect to the Projects. The provisions
of this Section 33 shall survive the Closing or the termination of this
Agreement (whichever shall occur) without restriction or limitation.


 


34.           Tax Allocations.
Purchaser and Seller agree that the consideration to be paid pursuant to this
Agreement, together with any assumed liabilities, shall be allocated among the
assets as set forth on Exhibit T. attached hereto and made a part hereof.
Seller and Purchaser hereby agree that IRS Form 8594 will be timely filed based
on such fair market values.


 


35.           Tax-Deferred
Exchange. If Seller, the Owners, any other party transferring any of the
Projects, or Purchaser desires to structure the applicable transaction to
effect a tax-deferred exchange under Section 1031 of the United States Internal
Revenue Code and the regulations promulgated thereunder, as amended, then the
other party or parties shall cooperate with the structuring party in such
effort provided (a) the structuring party pays all reasonable third party,
out-of-pocket costs and expenses incurred by the other party in connection
therewith, and (b) no other party incurs any potential liabilities as a result
thereof that would not otherwise have been incurred by the other party (e.g.,
by having to make any warranties under a deed).


 


36.           Assignment. Neither
this Agreement nor Seller’s or Purchaser’s rights and obligations hereunder,
may be assigned by the other party, and any such attempted assignment shall be
null and void, ab initio, and shall constitute a default by the assigning party
of this Agreement. Notwithstanding the foregoing, Purchaser may assign this
Agreement, in whole or in part, to any entity affiliated with or related to
Purchaser (herein referred to as “Affiliate”) without Seller’s consent,
provided that Purchaser shall in no event be released from any of its
obligations or liabilities hereunder as a result of any such assignment,
provided that any such assignment shall not in any way


 

















 


effect or delay Purchaser’s
ability to obtain the Bond Consent, Bond Release or CIBC Consent. In the event
that any Affiliate shall be designated as a transferee or assignee hereunder,
the Affiliate shall have the benefit of all of the representations, warranties
and other rights that would otherwise have run in favor of Purchaser.


 


37.           Termination of this
Agreement. Seller and Purchaser acknowledge and agree that if either party
hereto has the right to terminate this Agreement pursuant to the terms and
provisions hereof, and desires to exercise such right, then such party may
exercise such right with respect to the entire of this Agreement, it being the
understanding and agreement of Seller and Purchaser that it is their intent
that Purchaser acquire all or none of the Projects.


 


38.           Further Assurances.
All action required pursuant to this Agreement that is necessary to effectuate
the transaction contemplated herein will be taken promptly and in good faith by
Seller and Purchaser, and each shall furnish the other with such documents or
further assurances as the other may reasonably require to effectuate the
transaction contemplated by this Agreement.


 


[signature
page follows]


 

















 


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


 


	
  SELLER:

  	
  PRIME GROUP REALTY, L.P.,
  a Delaware

  
	
   

  	
   

  
	
   

  	
  limited partnership,
  individually and in

  its capacity as the sole administrative

  member of the Owners

  
	
   

  	
   

  
	
   

  	
  By:

  	
  PRIME GROUP REALTY TRUST,

  its Managing General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jeffrey A. Patterson

  	
   

  
	
   

  	
  Name:

  	
  Jeffrey A. Patterson

  	
   

  
	
   

  	
  Title:

  	
     President

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  PURCHASER:

  	
  CENTERPOINT PROPERTIES
  TRUST, a Maryland

  
	
   

  	
   

  
	
   

  	
  real estate investment
  trust

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Paul A. Ahern

  	
   

  
	
   

  	
  Name:

  	
  Paul A. Ahern

  	
   

  
	
   

  	
  Title:

  	
  Chief Investment Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John S. Gates, Jr.

  	
   

  
	
   

  	
  Name:

  	
  John S. Gates, Jr.

  	
   

  
	
   

  	
  Title:

  	
  Co-Chairman

  	
   

  
								



 

















 


LIST OF EXHIBITS


 


	
  Exhibit A-1
  through A-34

  	
   

  	
  Legal
  Descriptions of Parcels

  
	
  Exhibit B

  	
   

  	
  Property
  Schedule

  
	
  Exhibit C

  	
   

  	
  Lease
  Schedule

  
	
  Exhibit D

  	
   

  	
  Personal
  Property Schedule

  
	
  Exhibit E

  	
   

  	
  Joint Order
  Escrow - Earnest Money Escrow Agreement

  
	
  Exhibit F

  	
   

  	
  List of Bond
  Documents

  
	
  Exhibit G

  	
   

  	
  Description
  of the Illinois Bonds

  
	
  Exhibit H

  	
   

  	
  Debt
  Schedule

  
	
  Exhibit I

  	
   

  	
  Project
  Contracts Deemed to be Approved Contracts

  
	
  Exhibit J

  	
   

  	
  Tenant Purchase
  Rights

  
	
  Exhibit K

  	
   

  	
  Permitted
  Exceptions

  
	
  Exhibit L

  	
   

  	
  Undelivered
  Title Items

  
	
  Exhibit M

  	
   

  	
  Required
  Title Affidavits

  
	
  Exhibit N

  	
   

  	
  Environmental
  Escrow Agreement

  
	
  Exhibit O-1

  	
   

  	
  Tenant
  Letter

  
	
  Exhibit O-2

  	
   

  	
  Seller
  Estoppel Certificate

  
	
  Exhibit P

  	
   

  	
  Rent Subsidy
  Agreement

  
	
  Exhibit Q

  	
   

  	
  Exceptions
  Schedule

  
	
  Exhibit R

  	
   

  	
  Environmental
  Assessments and Reports

  
	
  Exhibit S

  	
   

  	
  Open Item
  List

  
	
  Exhibit T

  	
   

  	
  Allocation
  of Purchase Price

  



 

















 


EXHIBIT
A-1 THROUGH 1-32


 


Legal
Descriptions of Parcels


 


[INTENTIONALLY
DELETED]


 

















 


EXHIBIT
B


 


Property
Schedule


 


	
  Building Address

  	
   

  	
  Ownership
  Entity

  	
   

  	
  Building
  Number

  	
   

  	
  Location

  	
   

  	
  Total SF

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  342 Carol
  Lane

  	
   

  	
  342 Carol
  Lane, L.L.C.

  	
   

  	
   

  	
   

  	
  Elmhurst,
  Illinois

  	
   

  	
  67,935

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  343 Carol
  Lane

  	
   

  	
  343 Carol
  Lane, L.L.C.

  	
   

  	
   

  	
   

  	
  Elmhurst,
  Illinois

  	
   

  	
  30,084

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  370 Carol
  Lane

  	
   

  	
  370 Carol
  Lane, L.L.C.

  	
   

  	
   

  	
   

  	
  Elmhurst,
  Illinois

  	
   

  	
  60,290

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  388 Carol
  Lane

  	
   

  	
  388 Carol
  Lane, L.L.C.

  	
   

  	
   

  	
   

  	
  Elmhurst,
  Illinois

  	
   

  	
  40,502

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  200 E.
  Fullerton Avenue

  	
   

  	
  200 E.
  Fullerton, L.L.C.

  	
   

  	
   

  	
   

  	
  Carol
  Stream, Illinois

  	
   

  	
  66,254

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  350 Randy
  Road

  	
   

  	
  350 Randy
  Road, L.L.C.

  	
   

  	
   

  	
   

  	
  Carol
  Stream, Illinois

  	
   

  	
  25,200

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  550 Kehoe
  Boulevard

  	
   

  	
  550 Kehoe
  Blvd., L.L.C.

  	
   

  	
   

  	
   

  	
  Carol
  Stream, Illinois

  	
   

  	
  44,575

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4300 Madison
  Avenue

  	
   

  	
  4300 Madison
  Street, L.L.C.

  	
   

  	
   

  	
   

  	
  Hillside,
  Illinois

  	
   

  	
  127,129

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4211 Madison
  Avenue

  	
   

  	
  4211 Madison
  Street, L.L.C.

  	
   

  	
   

  	
   

  	
  Hillside,
  Illinois

  	
   

  	
  90,344

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4160 Madison
  Avenue

  	
   

  	
  4160 Madison
  Street, L.L.C.

  	
   

  	
   

  	
   

  	
  Hillside,
  Illinois

  	
   

  	
  79,532

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  555 Kirk
  Road

  	
   

  	
  555 Kirk
  Road, L.L.C.

  	
   

  	
   

  	
   

  	
  Batavia, Illinois

  	
   

  	
  62,400

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1455 Sequoia
  Drive

  	
   

  	
  1455 Sequoia
  Drive, L.L.C.

  	
   

  	
   

  	
   

  	
  Aurora,
  Illinois

  	
   

  	
  257,600

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1301 Tower
  Road

  	
   

  	
  1301 E.
  Tower Road, L.L.C.

  	
   

  	
   

  	
   

  	
  Schaumburg,
  Illinois

  	
   

  	
  50,400

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11039 Gage
  Avenue

  	
   

  	
  11039 Gage
  Avenue, L.L.C.

  	
   

  	
   

  	
   

  	
  Franklin
  Park, Illinois

  	
   

  	
  21,935

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11045 Gage
  Avenue

  	
   

  	
  11045 Gage
  Avenue, L.L.C.

  	
   

  	
   

  	
   

  	
  Franklin
  Park, Illinois

  	
   

  	
  136,600

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1401 S.
  Jefferson Street

  	
   

  	
  1401 S.
  Jefferson, L.L.C.

  	
   

  	
   

  	
   

  	
  Chicago,
  Illinois

  	
   

  	
  17,265

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1543 Abbott
  Drive

  	
   

  	
  1543 Abbott
  Drive, L.L.C.

  	
   

  	
   

  	
   

  	
  Wheeling,
  Illinois

  	
   

  	
  43,930

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  200 S.
  Mitchell Court

  	
   

  	
  200 S.
  Mitchell Court, L.L.C.

  	
   

  	
   

  	
   

  	
  Addison,
  Illinois

  	
   

  	
  152,200

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  425 E.
  Algonquin Road

  	
   

  	
  Arlington
  Heights I, L.P.

  	
   

  	
   

  	
   

  	
  Arlington
  Heights, Illinois

  	
   

  	
  304,506

  



 

















 


East Chicago Enterprise Center


 


	
  4407
  Railroad Avenue, Lot 1

  	
   

  	
  Enterprise
  Center I, L.P.

  	
   

  	
  Vacant Land

  	
   

  	
  East Chicago, Indiana

  	
   

  	
  —

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4407 Railroad Avenue, Building 2

  	
   

  	
  Enterprise Center II, L.P.

  	
   

  	
  Building 2

  	
   

  	
  East Chicago, Indiana

  	
   

  	
  169,435

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4407 Railroad Avenue, Building 3

  	
   

  	
  Enterprise Center III, L.P.

  	
   

  	
  Building 3

  	
   

  	
  East Chicago, Indiana

  	
   

  	
  291,550

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4407 Railroad Avenue, Building 4

  	
   

  	
  Enterprise Center IV, L.P.

  	
   

  	
  Building 4

  	
   

  	
  East Chicago, Indiana

  	
   

  	
  87,484

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4635 Railroad Ave.

  	
   

  	
  East Chicago Enterprise Center Limited
  Partnership

  	
   

  	
  Building T

  	
   

  	
  East Chicago, Indiana

  	
   

  	
  14,070

  



 


Hammond Enterprise Center


 


	
  4507 Columbia Avenue

  	
   

  	
  Enterprise Center V, L.P.

  	
   

  	
  4507 Columbia

  	
   

  	
  Hammond, Indiana

  	
   

  	
  196,475

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4531 Columbia Avenue

  	
   

  	
  Enterprise Center VI, L.P.

  	
   

  	
  4531 Columbia

  	
   

  	
  Hammond, Indiana

  	
   

  	
  250,266

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4527 Columbia Avenue

  	
   

  	
  Hammond Enterprise Center Limited
  Partnership

  	
   

  	
  Office
  Building and part of 4507 Columbia Ave. 

  	
   

  	
  Hammond, Indiana

  	
   

  	
  76,821

  



 


Chicago Enterprise Center


 


	
  13535 A&D S. Torrence Avenue

  	
   

  	
  Enterprise Center VII, L.P.

  	
   

  	
  Buildings A and P

  	
   

  	
  Chicago,
  Illinois

  	
   

  	
  462,670

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  13535 B S. Torrence Avenue

  	
   

  	
  Enterprise Center VIII, L.P.

  	
   

  	
  Building A.1

  	
   

  	
  Chicago, Illinois

  	
   

  	
  242,199

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  13535 E-G S. Torrence Avenue

  	
   

  	
  Enterprise Center IX, L.P.

  	
   

  	
  Buildings Q, R & S

  	
   

  	
  Chicago, Illinois

  	
   

  	
  162,682

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  13535 C&H S. Torrence Avenue

  	
   

  	
  Enterprise Center X, L.P.

  	
   

  	
  Buildings C and T

  	
   

  	
  Chicago, Illinois

  	
   

  	
  172,775

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  13535 S. Torrence Avenue

  	
   

  	
  Kemper/Prime Industrial Partners

  	
   

  	
  Vacant Land

  	
   

  	
  Chicago, Illinois

  	
   

  	
  —

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Total Sq.
  Footage

  	
   

  	
  3,805,108

  



 

















 


Land Parcels


 


	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Acreage

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Prime Aurora, L.L.C.

  	
   

  	
  Prime Aurora Business Park

  	
   

  	
  Parcels 1/2

  	
   

  	
  Aurora, IL

  	
   

  	
  19.97

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Parcel 5

  	
   

  	
   

  	
   

  	
  20.63

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Parcel 9 

  	
   

  	
   

  	
   

  	
  11.78

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pond

  	
   

  	
   

  	
   

  	
  Parcel 12, 

  	
   

  	
   

  	
   

  	
  9.90

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Parcel 13

  	
   

  	
   

  	
   

  	
  10.87

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  73.15

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  DeKalb Business Park, L.L.C.

  	
   

  	
  Prime DeKalb Business Park

  	
   

  	
  East of 1st, North side of
  Gurler

  	
   

  	
  DeKalb, IL

  	
   

  	
  36.33

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Oak Brook Business Center, L.L.C.

  	
   

  	
  Prime Batavia Business Park

  	
   

  	
  North side of Douglas

  	
   

  	
  Batavia, IL

  	
   

  	
  9.24

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  South side of Douglas

  	
   

  	
   

  	
   

  	
  9.52

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  18.76

  



 

















 


EXHIBIT
C


 


Lease
Schedule


 


[INTENTIONALLY
DELETED]


 

















 


EXHIBIT
E


 


Joint
Order Escrow


 


[INTENTIONALLY
DELETED]


 

















 


EXHIBIT
F


 


Description
of the Bonds


 


[INTENTIONALLY
DELETED]


 

















 


EXHIBIT
G


 


Description
of the Illinois Bonds


 


[INTENTIONALLY
DELETED]


 

















 


EXHIBIT
H


 


Debt
Schedule


 


CIBC
DEBT: POOL A


 


	
  Lender 

  	
   

  	
  Portfolio
  or Property

  
	
  CIBC, Inc.

  	
   

  	
  1401 South Jefferson
  Street, Chicago, IL

  
	
  ($14,933,000.00 Mortgage
  Loan)

  	
   

  	
  4211 Madison Street,
  Hillside, IL

  
	
   

  	
   

  	
  200 E. Fullerton Avenue,
  Carol Stream, IL

  
	
   

  	
   

  	
  350 Randy Road, Carol
  Stream, IL

  
	
   

  	
   

  	
  370 Carol Lane, Elmhurst,
  IL

  
	
   

  	
   

  	
  4160-4170 Madison Street,
  Hillside, IL

  
	
   

  	
   

  	
  11039 Gage Avenue, Franklin
  Park, IL

  
	
   

  	
   

  	
  11045 Gage Avenue,
  Franklin Park, IL

  



 


Current Loan Documents:


	
   

  	
   

  	
   

  
	
  1.

  	
   

  	
  Amended and Restated
  Substitute Note A

  
	
  2.

  	
   

  	
  Amended and Restated
  Substitute Mortgage A

  
	
  3.

  	
   

  	
  Assignment of Leases and
  Rents

  
	
  4.

  	
   

  	
  Guaranty of Payment

  
	
  5.

  	
   

  	
  Indemnity and Guaranty
  Agreement

  
	
  6.

  	
   

  	
  Hazardous Substance
  Indemnity Agreement

  
	
  7.

  	
   

  	
  Assignment of Warranties
  and Other Contract Rights

  
	
  8.

  	
   

  	
  Consent and Agreement of
  Manager

  
	
  9.

  	
   

  	
  Cash Management Agreement

  
	
  10.

  	
   

  	
  Certificate Regarding
  Loans to Related Parties

  
	
  11.

  	
   

  	
  Certificate of Rent Roll

  
	
  12.

  	
   

  	
  Certificate of Service
  Contracts

  
	
  13.

  	
   

  	
  Certificate as to
  Independent Director

  
	
  14.

  	
   

  	
  Certificate of Lease Form

  



 

















 


CIBC
DEBT: POOL B-1


 


	
  Lender 

  	
   

  	
  Portfolio
  or Property

  
	
  CIBC, Inc.

  	
   

  	
  4300 Madison Street,
  Hillside, IL

  
	
  ($15,556,000.00 Mortgage
  Loan)

  	
   

  	
  550 Kehoe Boulevard, Carol
  Stream, IL

  
	
   

  	
   

  	
  342-346 Carol Lane,
  Elmhurst, IL

  
	
   

  	
   

  	
  343 Carol Lane, Elmhurst,
  IL

  
	
   

  	
   

  	
  388 Carol Lane, Elmhurst,
  IL

  
	
   

  	
   

  	
  1301 E. Tower Road,
  Schaumburg, IL

  



 


Current Loan Documents:


 


1.             Amended
and Restated Substitute Note B-1 


2.             Amended
and Restated Substitute Mortgage B-1


3.             Assignment
of Leases and Rents 


4.             Guaranty
of Payment 


5.             Indemnity
and Guaranty Agreement 


6.             Hazardous
Substance Indemnity Agreement 


7.             Assignment
of Warranties and Other Contract Rights 


8.             Consent
and Agreement of Manager 


9.             Cash
Management Agreement 


10.           Certificate
Regarding Loans to Related Parties 


11.           Certificate
of Rent Roll 


12.           Certificate
of Service Contracts 


13.           Certificate
as to Independent Director 


14.           Certificate
of Lease Form


 

















 


LIST
OF NON-ASSUMED DEBT


 


	
  Lender 

  	
   

  	
  Portfolio
  or Property

  
	
  LaSalle Bank, N.A.

  	
   

  	
   

  
	
  ($6 million construction
  loan)

  	
   

  	
  1455 Sequoia Drive,
  Aurora, IL

  
	
   

  	
   

  	
   

  
	
  Corus Bank, N.A.

  	
   

  	
  200 S. Mitchell Court,
  Addison, IL

  
	
  ($4.235 million first
  mortgage loan)

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  LaSalle Bank, N.A. 

  	
   

  	
  555 Kirk Road, St.
  Charles, IL

  
	
  ($2.5 million first
  mortgage loan)

  	
   

  	
  1543 Abbott Drive,
  Wheeling, IL

  



 

















 


EXHIBIT
I


 


Project
Contracts Deemed to be Approved Contracts


 


[INTENTIONALLY
DELETED]


 

















 


EXHIBIT
J


 


Tenant
Purchase Rights


 


[INTENTIONALLY
DELETED]


 

















 


EXHIBIT
K


 


Permitted
Exceptions


 


[INTENTIONALLY
DELETED]


 

















 


EXHIBIT
L


 


Undelivered
Title Items


 


[INTENTIONALLY
DELETED]


 

















 


EXHIBIT
M


 


Required
Title Affidavits


 


[INTENTIONALLY
DELETED]


 

















 


EXHIBIT
N


 


Environmental
Escrow Agreement


 


THIS ENVIRONMENTAL ESCROW AGREEMENT (the “Agreement”) is made and
entered into this        day of
             ,
2004, by and among PRIME GROUP REALTY, L.P., a Delaware limited partnership
(“Seller”); CENTERPOINT PROPERTIES TRUST, a Maryland real estate investment
trust (“Buyer”); and CHICAGO TITLE AND TRUST COMPANY (“Escrow Agent”).


 


W
I T N E S S E T H:


 


A.            Seller and Buyer
have executed and delivered that certain Purchase Agreement dated August 2,
2004, pursuant to which Seller agreed to convey certain land and improvements
to Buyer, all as more particularly described therein. Such Purchase Agreement,
as same may have been amended, is hereinafter referred to as the “Disposition
Agreement.” Unless otherwise defined herein, all initially capitalized terms shall
have the respective meanings assigned thereto in the Disposition Agreement.


 


B.            In the course of its
due diligence, Seller identified the following Properties which require
environmental remediation in order to obtain a No Further Remediation Letter
(“NFR Letter”) from the Illinois Environmental Protection Agency (“IEPA”) or a
Certificate of Completion (“Certificate of Completion”) issued by the Indiana
Department of Environmental Management (“IDEM”) and a Covenant Not to Sue
(“Covenant Not to Sue”) issued by the Governor of Indiana: Chicago Enterprise
Center, 13535 S. Torrence Avenue, Chicago, Illinois (“Chicago Enterprise
Center”); Hammond Enterprise Center, 4507, 4531, and 4527 Columbia Avenue,
Hammond, Indiana (the “Hammond Site”); and East Chicago Enterprise Center, 4407
Railroad Avenue, E. Chicago, Indiana (the “East Chicago Site”) (collectively,
the “Environmental Escrow Properties”).


 


C.            Seller has agreed to
deposit into escrow the sums described herein in order to pay for a portion of
the remediation of the Environmental Escrow Properties as provided below and to
secure Buyer’s delivery of an NFR Letter issued by IEPA or Certificate of
Completion issued by IDEM and Covenant Not to Sue issued by the Governor of
Indiana for each Environmental Escrow Property, and the parties desire to enter
into this Agreement for the purpose of holding and disbursing such funds in
accordance with the terms of this Agreement.


 


NOW, THEREFORE, for and in consideration of the foregoing premises, the
mutual covenants and agreements contained herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Seller, Buyer, and Escrow Agent do hereby covenant and agree as follows:


 


1.             Environmental
Escrow Properties. The following properties constitute the Environmental Escrow
Properties under the terms of this Agreement:


 


a.             Chicago Enterprise Center. Seller,
by and through its consultant, Carlson Environmental, Inc. (“CEI”), discovered
contamination in the course of its due diligence for Seller, including
extensive hazardous lead and other lead contamination, the presence of free
product in three locations (between Building A-1 and C; the former slip area;
and the former underground storage tank (“UST”) farm west of Building C and
south of Building A), and other contaminants of concern (e.g., polychlorinated
biphenyls (“PCBs”), arsenic and chlorinated solvent analytes). CEI recommended
obtaining an NFR Letter through the Illinois Site Remediation Program. Seller
has disclosed to Buyer a Risk Assessment dated June 1999 and prepared by Foth
& Van Dyke for Chicago Enterprise Center (hereinafter “Risk Assessment”).
The Risk Assessment provides for a clean-up objective for lead of nine hundred
parts per million (“900 ppm”). Seller agreed in the May 4, 2004 Letter of
Intent, by and between the Parties, to fund an escrow account with two million


 

















 


nine hundred thousand
dollars ($2,900,000.00) to fund Buyer’s remediation of the Chicago Enterprise
Center and Buyer’s reasonable costs and expenses associated with obtaining an
NFR Letter from the IEPA with respect to all known contamination for Chicago
Enterprise Center. Buyer covenants and agrees (1) to remediate Chicago
Enterprise Center as required to obtain the NFR Letter from the IEPA with
respect to all known contamination, including, but not limited to, all
Hazardous Substances as defined by CERCLA and identified in Removal Site
Evaluation and Preliminary Assessment - Event Two Report - April, 1997 prepared
by CEI with respect to Chicago Enterprise Center, (2) to commence such
remediation not later than May 21, 2006, (3) to diligently pursue and complete
such remediation within a reasonable period of time, and (4) to use good faith
efforts to add Prime Group Realty, L.P., Prime Group Realty Trust, Enterprise
Center VII, L.P., Enterprise Center VIII, L.P., Enterprise Center IX, L.P.,
Enterprise Center X, L.P., Kemper/Prime Industrial Partners, Illinois Tool
Works Inc., Signode Corporation and USX Corporation as additional recipients of
the NFR Letter and to cause the IEPA to furnish (or to furnish itself) all such
parties with copies of the NFR Letter when issued.


 


b.             Hammond Site. In the course of its
due diligence, Seller, by and through its consultant, Heritage Environmental
Services LLC (“Heritage”), discovered contamination related to the presence of
free product, lead, semi-volatile organic compounds (“SVOCs”) and the presence
of an underground storage tank (“UST”), among other issues. Groundwater
monitoring, due to the presence of historical free product, is required to be
conducted at the Hammond Site for one additional quarter. Seller agreed in the
May 4, 2004 Letter of Intent, by and between the Parties, to fund an escrow
account with up to one hundred thousand dollars ($100,000.00)(less amounts
spent by Seller after May 4, 2004 and prior to Closing in connection with said
remediation at the Hammond Site which amounts shall be subject to Buyer’s
review and approval of detailed invoices from Seller’s environmental
consultant) to fund Buyer’s remediation of the Hammond Site and Buyer’s
reasonable costs and expenses associated with obtaining a Certificate of
Completion issued by IDEM and Covenant Not to Sue issued by the Governor of
Indiana for the Hammond Site.


 


c.             East Chicago Site. In the course of
its due diligence, Seller, by and through its consultant, Heritage, discovered
contamination related to the presence of elevated levels of TPH and the
presence of an underground storage tank (“UST”), among other issues.
Groundwater monitoring, due to the presence of elevated levels of petroleum
products, is required to be conducted at the East Chicago Site for one
additional quarter. In addition, IDEM has not approved the remedial action plan
submitted by Heritage to address the elevated levels of TPH in the soils within
two areas of the site. Seller agreed in the May 4, 2004 Letter of Intent, by
and between the Parties, to fund an escrow account with up to one hundred sixty
four thousand dollars ($164,000.00)(less amounts spent by Seller after May 4,
2004 and prior to Closing in connection with said remediation at the East
Chicago Site which amounts shall be subject to Buyer’s review and approval of
detailed invoices from Seller’s environmental consultant) to fund Buyer’s
remediation of the East Chicago Site and Buyer’s reasonable costs and expenses
associated with obtaining a Certificate of Completion issued by IDEM and
Covenant Not to Sue issued by the Governor of Indiana for the East Chicago
Site. During the course of its due diligence, Buyer identified free product at
the East Chicago Site, as well as TPH levels in excess of fifty thousand parts
per million (50,000 ppm). Buyer also identified the presence of PCBs,
chlorinated solvents, and chromium within the site soils. Further, Buyer detected
chrome in ground water beneath the Electro Coating Technologies tenant space.
Seller has agreed to fund an escrow account with one million two hundred fifty
thousand dollars ($1,250,000.00) to fund Buyer’s


 

















 


remediation of the East
Chicago Site to the extent required in order for Buyer to obtain a Certificate
of Completion issued by IDEM and Covenant Not to Sue issued by the Governor of
Indiana.


 


2.             Escrowed Funds.


 


a.             Seller has
deposited with Escrow Agent an amount equal to THREE MILLION ONE HUNDRED
SIXTY-FOUR THOUSAND DOLLARS ($3,164,000.00) (the “Escrow Amount”) to pay for
the remediation of the Environmental Escrow Properties to applicable
industrial/commercial or construction worker remedial objectives and applicable
groundwater standards as established under the applicable IEPA Tiered Approach
to Corrective Action Objectives (“TACO”) or the IDEM Risk Based Clean-Up
Objectives (the “Remediation”), and the obtainment by Buyer of an NFR Letter
from IEPA, or a Certificate of Completion issued by IDEM and a Covenant Not to
Sue issued by the Governor of Indiana for each respective Environmental Escrow
Property.


 


b.             Seller has also
deposited with Escrow Agent an amount equal to ONE MILLION TWO HUNDRED FIFTY
THOUSAND DOLLARS ($1,250,000.00) (the “East Chicago Supplemental Escrow
Amount”) to pay for any Remediation of TPH, free product, PCBs, chlorinated
solvents and chromium if and to the extent required by IDEM at the East Chicago
Site in order to obtain a Certificate of Completion issued by IDEM and a Covenant
Not to Sue issued by the Governor of Indiana, respectively. The East Chicago
Supplemental Escrow Amount shall only be used in connection with the
Remediation of TPH, free product, PCBs, chlorinated solvents and chromium if
and to the extent required by IDEM. If (i) IDEM does not require Remediation of
TPH, free product, PCBs, chlorinated solvents or chromium at the East Chicago
Site in order to issue a Certificate of Completion, and (ii) the Governor of
Indiana does not require Remediation of TPH, free product, PCBs, chlorinated
solvents or chromium at the East Chicago Site in order to issue a Covenant Not
to Sue, the East Chicago Supplemental Escrow Amount shall be promptly released
to Seller.


 


c.             By its execution of
this Agreement, Escrow Agent acknowledges receipt of the funds in an amount
equal to the Escrow Amount and East Chicago Supplemental Escrow Amount
(collectively, the “Escrowed Funds”).


 


3.             Use of Escrowed
Funds.


 


a.             Escrowed Funds. The Escrowed Funds shall be used by
Buyer to remediate the Environmental Escrow Properties and to obtain the
Certificates of Completion issued by IDEM and Covenants Not to Sue issued by
the Governor of Indiana for the East Chicago Site and the Hammond Site and NFR
Letter(s) from IEPA for Chicago Enterprise Center. Buyer shall diligently
obtain the Certificates of Completion, Covenants Not to Sue and NFR Letters for
each Environmental Escrow Property and shall diligently complete the
Remediation at the Environmental Escrow Properties. Subject to the provisions of
this Agreement, including, but not limited to, Section 1, the Remediation of
the Environmental Escrow Properties is at the sole direction of Buyer.


 


b.             Environmental Escrow Properties - Seller’s Liability.
Buyer agrees that Seller’s liability to Buyer under this Agreement for the
Remediation of the Environmental Escrow Properties shall be limited to the
Escrowed Funds. Notwithstanding the foregoing, this Section 3(b) shall in no
manner limit or restrict Seller’s obligations under the Disposition Agreement
(subject to the terms and provisions contained therein).


 


c.             Use of Escrowed Funds. Buyer agrees to use the Escrowed
Funds for the purposes set forth in Paragraph 3 (a)-(c) of this Agreement.
Buyer may use the Escrowed Funds for costs associated with, but not necessarily
limited to: filing, review, application, oversight and other fees and charges
payable to IEPA or IDEM; all fees and charges invoiced by the contractors
selected by Buyer and reasonably acceptable to Seller for services contemplated
under this Agreement; laboratory charges; charges for disposal of hazardous or


 

















 


non-hazardous
wastes in connection with such Remediation; and all reasonable fees and costs
incurred by Buyer’s counsel in connection with monitoring the Remediation or
negotiating with IEPA or IDEM.


 


d.             Release of Seller. Buyer, its parents, subsidiaries,
affiliates, divisions, shareholders, officers, directors, employees, agents,
insurers, trustees, attorneys, representatives, successors and assigns do
hereby fully and forever release, acquit and discharge Seller, Enterprise
Center I, L.P, Enterprise Center II, L.P., Enterprise Center III, L.P.,
Enterprise Center IV, L.P. , East Chicago Enterprise Center Limited
Partnership, Enterprise Center V, L.P., Enterprise Center VI, L.P., Hammond
Enterprise Center Limited Partnership, Enterprise Center VII, L.P., Enterprise
Center VIII, L.P., Enterprise Center IX, L.P., Enterprise Center X, L.P.,
Kemper/Prime Industrial Partners and each of their respective parents,
subsidiaries, affiliates, divisions, shareholders, officers, directors,
employees, agents, insurers, trustees, attorneys, representatives, successors
and assigns (the “Seller Released Parties”), of and from any and all common law
and statutory claims, demands, rights, liabilities, suits, set-offs, damages,
actions or causes of action, attorney fees, or related costs or expenses
incurred by Buyer, or its parent, subsidiaries, affiliates, divisions,
shareholders, officers, directors, employees, agents, insurers, trustees,
attorneys, representatives, successors and assigns, of whatsoever kind and
nature, known or unknown, foreseen or unforeseen, matured or unmatured, accrued
or unaccrued which are or may be based upon or related in any way to the
investigation, assessment, presence or remediation of any Hazardous Materials
at any Environmental Escrow Property. For purposes of this Agreement,
“Hazardous Materials” shall mean any hazardous substance, pollutant,
contaminant, or waste regulated under any federal, state or local statute, ordinance,
regulation or rule relating to environmental quality, health, safety,
contamination and clean-up, asbestos and asbestos-containing materials in any
form; oil and petroleum products and natural gas, natural gas liquids,
liquefied natural gas and synthetic gas usable for fuel; pesticides regulated
under FIFRA; PCBs and other substances regulated under TSCA; source material,
special nuclear material, byproduct materials, and any other radioactive
materials or radioactive wastes however produced, regulated under the Atomic
Energy Act or the Nuclear-Waste Policy Act; chemicals subject to the OSHA
Hazard Communication Standard, 29 C.F.R. ss.1910.1200 et seq.; and industrial
process and pollution control wastes whether or not hazardous within the
meaning of RCRA. This release shall be contained in the special warranty deeds
to be delivered at closing or included in a separate document and placed of
record against the Environmental Escrow Properties. Notwithstanding the
foregoing, this Section 3(d) shall in no manner limit or restrict Seller’s
obligations under the Disposition Agreement (subject to the terms and
provisions contained therein).


 


e.             Release of Buyer. Upon Buyer’s completion of its
obligations set forth in this Agreement, Seller, its parents, subsidiaries,
affiliates, divisions, shareholders, officers, directors, employees, agents,
insurers, trustees, attorneys, representatives, successors and assigns do
hereby fully and forever release, acquit and discharge Buyer and each of its
respective parents, subsidiaries, affiliates, divisions, shareholders,
officers, directors, employees, agents, insurers, trustees, attorneys,
representatives, successors and assigns (the “Buyer Released Parties”), of and
from any and all common law and statutory claims, demands, rights, liabilities,
suits, set-offs, damages, actions or causes of action, attorney fees, or
related costs or expenses incurred by Seller, or any other Seller Released
Party, of whatsoever kind and nature, known or unknown, foreseen or unforeseen,
matured or unmatured, accrued or unaccrued which are or may be based upon or
related in any way to the investigation, assessment, presence or remediation of
any Hazardous Materials at any Environmental Escrow Property. This release
shall be contained in the special warranty deeds to be delivered at closing or
included in a separate document and placed of record against the Environmental
Escrow Properties. Notwithstanding the foregoing, this Section 3(e) shall in no
manner limit or restrict Buyer’s obligations under this Agreement or the
Disposition Agreement (subject to the terms and provisions contained herein and
therein).


 

















 


f.              Buyer acknowledges and agrees that Buyer has received
and reviewed copies of the settlement agreements with USX Corporation (the “USX
Settlement Agreement”) and Signode Corporation, a Division of Illinois Tool
Works, Inc. (the “Signode Settlement Agreement”) relating to the litigation
entitled Enterprise Center VII, L.P., Enterprise Center VIII, L.P., Enterprise
Center IX, L.P., Enterprise Center X, L.P. and Kemper/Prime Industrial Partners
v. USX Corporation v. The Prime Group, Inc., Case No. 96C 5283, filed on August
22, 1996, in the United States District Court for the Northern District of
Illinois, Eastern Division, and that certain provisions of the Settlement
Agreements, including, but not limited to, release provisions, are binding upon
and/or benefit Buyer, as a successor in interest to Seller and the Owners of
Chicago Enterprise Center.


 


4.             Administration of Escrowed Funds. Escrow Agent hereby
agrees to hold, administer and disburse the Escrowed Funds pursuant to this
Agreement in accordance with written instructions given to it as provided
herein. Escrow Agent shall invest the Escrow Amount in accordance with written
investment instructions from Buyer, with interest on the Escrow Amount reported
under the United States Taxpayer Identification Number of Buyer. Escrow Agent
shall invest the East Chicago Supplemental Escrow Amount in an interest bearing
account at a bank reasonably acceptable to Buyer and Seller, with interest on
the East Chicago Supplemental Escrow Amount reported under the United States
Taxpayer Identification Number of Seller. All interest on the Escrowed Funds
shall be reinvested in the Escrowed Funds on the first day of each quarter
until all Escrowed Funds have been fully distributed in accordance with the
terms of this Agreement.


 


5.             Disbursements by
Escrow Agent.


 


a.             Disbursements of the Escrowed Funds shall be pursuant to
written Requisitions submitted by Buyer. Each Requisition shall be signed by
Buyer and shall state with specificity (i) the amount being requisitioned out
of the Escrow, and whether such funds are payable from the Escrow Amount or the
East Chicago Supplemental Escrow Amount; (ii) an itemization of the costs and
expenses covered by the Requisition, including the names of the governmental
agencies, contractors, subcontractors or other vendors or payees for whose fees
or charges payment or reimbursement is being requisitioned; and (iii) shall
include Buyer’s certification that all such Escrowed Funds requisitioned are
proper expenditures authorized by this Escrow.


 


b.             Buyer shall submit the original of each Requisition to
the Escrow Agent with a copy to Seller. The Escrow Agent shall have absolutely
no duty or obligation to investigate or inquire into the accuracy or
completeness of any Requisition, except to confirm to its reasonable
satisfaction that the procedures herein have been followed, and the Requisition
document itself and the signature of Buyer on the Requisition are genuine. All
disbursements shall be made within one (1) business day after the Escrow
Agent’s receipt of the corresponding Requisition (unless the Escrow Agent is
not satisfied that the procedures with respect to such Requisition have been
followed). If wire transfers of funds are required for any disbursement, the
Escrow Agent’s regular charge or fee for such additional service shall be paid
out of the Escrow. Seller’s inability to object to the disbursement of Escrowed
Funds hereunder shall not be deemed a waiver of any rights it may have against
the Buyer under this Escrow Agreement.


 


c.             Upon completion of the remediation of the Environmental
Escrow Properties and receipt of the final NFR Letters for Chicago Enterprise Center
and final Certificates of Completion and Covenants Not to Sue for the Hammond
Site and the East Chicago Site, Buyer shall promptly provide written notice
(the “Closure Notice”) to Seller and Escrow Agent, together with copies of the
NFR Letters, Certificates of Completion and Covenants Not to Sue. Upon receipt
of the Closure Notice, the Escrow Agent is hereby directed to immediately
disburse the remainder, if any, of the Escrow Amount to Buyer and


 

















 


the
remainder, if any, of the East Chicago Supplemental Escrow Amount to Seller.


 


d.             Escrow Agent is released from all liability for
disbursing the Escrowed Funds to Buyer under this clause.


 


6.             Escrow Agent. In
the absence of bad faith on its part, Escrow Agent may conclusively rely on a
notice of instruction that is furnished to Escrow Agent that conforms to the
requirements of this Agreement. In performing any of its duties hereunder,
Escrow Agent shall not incur any liability to anyone for any damages, losses or
expenses except for willful default or breach of trust, and it shall
accordingly not incur any such liability with respect to any action taken or
omitted in reliance upon any instrument, including any written notice or
instruction provided for in this Agreement, not only as to its due execution
and the validity and effectiveness of its provisions, contained therein, but
which the Escrow Agent shall in good faith believe to be genuine, to have been
signed or presented by a proper person or persons and to conform with the
provisions of this Agreement. In the event any party disputes a proposed
disbursal by Escrow Agent and Escrow Agent is unable to resolve the dispute,
Escrow Agent may tender the Escrowed Funds into a court Escrow Agent deems to
be of competent jurisdiction which shall discharge Escrow Agent of all further
duties and liabilities hereunder or under this Agreement. Seller and Buyer
hereby agree to indemnify and hold harmless Escrow Agent against any and all
losses, claims, and counsel fees and disbursements which may be imposed upon Escrow
Agent or incurred by Escrow Agent hereunder and attributable to the acts of
such party, except those arising from willful default or breach of trust by
Escrow Agent or the performance of its duties hereunder, including any
litigation arising from this Agreement or involving the subject matter hereof.
Seller and Buyer have no obligation to indemnify Escrow Agent for the acts of
any other party. The total fees charged by Escrow Agent hereunder shall be paid
from the Escrow Amount. Such fees shall not exceed the investment fee normally
charged by Escrowee for invested client funds.


 


7.             Term of Agreement.
The term of this Agreement shall commence on the date hereof and expire on the
first to occur of (i) Seller’s receipt of a Closure Notice together with copies
of all NFR Letters, Certificates of Completion and Covenants Not to Sue
required to be delivered in connection therewith, or (ii) the written agreement
of the parties hereto.


 


8.             Notices. Any
notices pursuant to this Agreement shall be given in writing by (a) personal
delivery, or (b) reputable overnight delivery service with proof of delivery,
or (c) United States Mail, postage prepaid, registered or certified mail,
return receipt requested, or (d) legible facsimile transmission sent to the
intended addressee, in each case addressed as follows:


 


	
  If intended for Seller:

  	
   

  	
  c/o Prime Group Realty
  Trust 

  
	
   

  	
   

  	
  77 West Wacker Drive 

  
	
   

  	
   

  	
  Suite 3900 

  
	
   

  	
   

  	
  Chicago, Illinois 60601 

  
	
   

  	
   

  	
  Attention: Mr. Jeffrey A.
  Patterson

  
	
   

  	
   

  	
   

  
	
  with a copy to:

  	
   

  	
  c/o Prime Group Realty Trust

  
	
   

  	
   

  	
  77 West Wacker Drive

  
	
   

  	
   

  	
  Suite 3900

  
	
   

  	
   

  	
  Chicago, Illinois 60601

  
	
   

  	
   

  	
  Attention: James F.
  Hoffman, Esq.

  
	
   

  	
   

  	
   

  
	
  If intended for Purchaser:

  	
   

  	
  CenterPoint Properties
  Trust

  
	
   

  	
   

  	
  1808 Swift Drive 

  
	
   

  	
   

  	
  Oak Brook, Illinois 60523

  
	
   

  	
   

  	
  Attention: Mr. Michael M.
  Mullen

  
	
   

  	
   

  	
   

  
	
  with a copy to:

  	
   

  	
   

  
	
   

  	
   

  	
  Weinberg Richmond LLP 

  
	
   

  	
   

  	
  333 West Wacker Drive

  
	
   

  	
   

  	
  Suite 1800

  



 

















 


	
   

  	
   

  	
  Chicago, Illinois 60606

  
	
   

  	
   

  	
  Attention: Mark S.
  Richmond, Esq.

  
	
   

  	
   

  	
   

  
	
  If intended for Escrow
  Agent:

  	
   

  	
  Chicago Title and Trust
  Company 

  
	
   

  	
   

  	
  171 North Clark Street

  
	
   

  	
   

  	
  Chicago, Illinois 60601

  
	
   

  	
   

  	
  Attention: Ms. Nancy
  Castro

  



 


or to such other address or to the attention
of such other person as the addressee shall have designated by written notice
sent in accordance herewith, and shall be deemed to have been given either at the
time of personal delivery, or, in the case of expedited delivery service or
mail, as of the date of first attempted delivery at the address and in the
manner provided herein, or, in the case of facsimile transmission, as of the
date of the facsimile transmission provided that an original of such facsimile
is also sent to the intended addressee by means described in clauses (a), (b)
or (c) above. Any party, by written notice to the others in the manner herein
provided, may designate (A) an address different from that set forth in this
Agreement and (B) an additional address (for example, without limitation) of a
mortgagee.


 


9.             Counterparts/Facsimile
Execution. This Agreement may be executed in multiple counterparts, each of
which shall be deemed an original but together shall constitute one and the
same instrument. This Agreement may be executed by facsimile and each party
shall have the right to rely upon a facsimile counterpart signed by any other
party to the same extent as if such party had received an original counterpart
from the party signing such facsimile counterpart.


 


10.           Assignment. Buyer
may assign the rights, duties and obligations contained in this Agreement, in
whole or in part, to any subsequent owner of any of the Environmental Escrow
Properties, provided that Buyer shall in no event be released from any of its
obligations or liabilities hereunder as a result of any such assignment.


 


11.           Miscellaneous. This
Agreement shall be construed, enforced and interpreted in accordance with the
laws of the State of Illinois. The terms and conditions of this Agreement shall
be binding upon and inure to the benefit of the parties hereto, their
successors, legal representatives and assigns. This Agreement may not be
amended or modified except by a written instrument executed by all of the
parties hereto. In the event that Buyer or Seller is required to enforce the
provisions of this Agreement, such party, if it prevails, shall be entitled to
receive from the other party all costs and expenses, including, without
limitation, reasonable attorneys’ fees incurred. Time is of the essence of this
Agreement. If any time period by which any right, option or election provided
in this Agreement must be exercised, or by which any act must be performed,
expires on a Saturday, Sunday or legal holiday, then such time period shall be
extended through the close of business on the next business day (which, for
purposes hereof, shall be any day which is not a Saturday, Sunday or legal
holiday.


 

















 


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


 


	
  BUYER: 

  	
   

  	
  SELLER:

  
	
   

  	
   

  	
   

  
	
  CENTERPOINT PROPERTIES
  TRUST,

  	
   

  	
  PRIME GROUP REALTY TRUST, 

  
	
  a Maryland real estate
  investment trust 

  	
   

  	
  a Delaware limited
  partnership

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
  Name:

  	
   

  	
  Name:

  
	
  Title:

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ESCROW AGENT:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  CHICAGO TITLE AND TRUST
  COMPANY

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
									



 

















 


EXHIBIT
O-1


 


Tenant
Letter


 


[INTENTIONALLY
DELETED]


 

















 


EXHIBIT
O-2


 


FORM
OF SELLER’S ESTOPPEL CERTIFICATE


 


[INTENTIONALLY
DELETED]


 

















 


EXHIBIT
P


 


Rent
Subsidy Escrow Agreement


 


THIS ESCROW AGREEMENT (“Escrow Agreement”) is made effective as of ,
2004 (the “Effective Date”), by and among CENTERPOINT PROPERTIES TRUST, a
Maryland real estate investment trust (herein referred to as “Purchaser”) and
PRIME GROUP REALTY, L.P., a Delaware limited partnership (herein referred to as
“Seller”), and CHICAGO TITLE AND TRUST COMPANY (the “Escrow Agent”).


 


RECITALS:


 


A.            Seller and Purchaser
entered into that certain Purchase Agreement dated as of August 2, 2004 (as
amended from time to time, the “Agreement”), which provides for the sale and
purchase of, among other things, that certain real property commonly known as
1455 Sequoia Drive in Aurora, Illinois (the “1455 Sequoia Project”) and that
certain real property commonly known as the Arlington Heights Enterprise
Center, 425 E. Algonquin Road, Arlington Heights, Illinois (the “Arlington
Heights Project”).


 


B.            Seller has agreed to
deposit $848,641 in escrow with the Escrow Agent (“Escrowed Funds”), who has
agreed to act as escrow agent with respect to the Escrowed Funds pursuant to
the terms set forth herein. The Escrowed Funds represent rental income or
operating expenses for the vacant space in the 1455 Sequoia Project and the
Arlington Heights Project as of the date hereof (the “Vacant Space”) calculated
as depicted on Exhibit A.


 


C.            The parties desire
to appoint the Escrow Agent to act on their behalf with respect to the matters
contained in this Escrow Agreement.


 


AGREEMENTS:


 


NOW, THEREFORE, IN CONSIDERATION of the Recitals, which are hereby
incorporated herein, and further in consideration of the mutual covenants set
forth herein, the parties agree as follows:


 


1.             Escrowed
Funds.


 


a.                                       Appointment and Acceptance of the Escrow
Agent. The Escrow Agent is hereby appointed by the Purchaser and the Seller as
escrow agent to act in accordance with the instructions set forth herein. The
Escrow Agent hereby accepts such appointment.


 


b.                                      Term of Escrow. This Escrow Agreement shall
terminate on the date all of the funds in the Escrowed Funds have been
disbursed as provided herein.


 


c.                                       Duty to Hold Escrowed Funds. Escrow Agent
shall hold the Escrowed Funds and all earnings thereon and shall disburse such
funds only in accordance with this Agreement.


 


d.                                      Investment. Escrow Agent is authorized and
directed to invest the Escrowed Funds deposited pursuant hereto on the joint
written direction of the parties. Each taxpayer’s identification number and
investment forms as required shall be provided prior to any such investment.
Escrow Agent is not to be held responsible for any loss of principal or
interest which may be incurred as a result of making the investments or
redeeming said investments as provided herein, including, but not limited to,
any loss occasioned by reason of the fact that the selected investment may not
be insured by the Federal Deposit Insurance


 

















 


Corporation. Escrow Agent
shall not be held responsible for failure to invest funds for which it has not
received written instructions, completed investment forms, bank credit advise
of receipt of funds or for delays in wire transfer of funds not caused by its
own negligence.


 


2.             Disposition
of Escrowed Funds.


 


a.                                       Joint Direction. Except as otherwise provided
in this Section 2, the Escrow Agent is authorized to disburse the Escrow
Deposit only in accordance with instructions set forth in any written letter of
direction executed by both Purchaser and Seller.


 


b.                                      Rental Subsidy. On [date of Closing] and on
the first day of each month thereafter up to and including
[                  ,
2005], Purchaser shall submit to Seller and Escrow Agent a certification (the
“Leasing Certification”) in the form attached hereto as Exhibit A which
specifies the amount of rental income for the current month attributable to the
Vacant Space and such backup information as is reasonably required to verify
such rental income. In the event such Leasing Certification reflects no rental
income attributable to the Vacant Space for the then-current month, Escrow
Agent shall, upon its receipt of such Leasing Certification, release to
Purchaser an amount equal to $70,720.08 (the “Monthly Escrow Payment”) from the
Escrowed Funds (prorated for any partial month). In the event that the Leasing
Certification reflects rental income attributable to the Vacant Space for the
then-current month, Escrow Agent shall, within five (5) days after its receipt
of such Leasing Certification, (1) release to Purchaser an amount equal to the
Monthly Escrow Payment less the amount of any rental income set forth in such
Leasing Certification, and (2) release to Seller an amount equal to the rental
income shown on the Leasing Certification. After payment of any amounts due and
owing to Purchaser based upon the Leasing Certification received from Purchaser
for the month of [ , 2005], Escrow Agent shall release the balance of the
Escrowed Funds, if any, to Seller. “Rental Income” shall include any base-rent
or additional rent payable during the current month by any tenants or occupants
of any portion of the Vacant Space, including operating expenses and real
estate tax payments.


 


c.                                       Leasing. Purchaser shall retain a commercial
leasing broker to attempt to lease the Vacant Space, and the Monthly Escrow
Payments shall be offset by any Rental Income for new leases signed by
Purchaser from any tenants or occupants of the Vacant Space during such
12-month period. Upon Seller’s request, Purchaser shall promptly provide Seller
with copies of the pertinent provisions of any new leases and such other
information as Seller shall reasonably request to audit the information
contained in any Leasing Certification.


 


3.             Limitations
on Liability of Escrow Agent.


 


a.                                       The duties and obligations of Escrow Agent
shall be determined solely by the provisions of this Escrow Agreement and no
implied duties or obligations shall be read into this Escrow Agreement against
Escrow Agent. Escrow Agent shall be under no obligation to refer to the
Agreement or any other documents between or among the parties related in any
way to this Escrow Agreement, except as specifically provided herein.


 


b.                                      Escrow Agent shall not be liable to anyone
for any damages, losses or expenses for any act done or step taken or omitted
by Escrow Agent in good faith; provided, however, that Escrow Agent shall be
liable for damages, losses and expenses arising out of its willful default or
gross negligence under this Escrow Agreement.


 


c.                                       Escrow Agent shall be entitled to rely upon,
and shall be protected in


 

















 


acting in reasonable
reliance upon, any writing furnished to Escrow Agent by any party in accordance
with the terms hereof, which the Escrow Agent believes in good faith to be
genuine and valid and to have been signed by the proper party or parties.


 


d.                                      Escrow Agent may, but shall not be required,
to file an action of interpleader in connection with any disagreement or
dispute between the parties to this Escrow Agreement. Escrow Agent shall be
entitled to be paid or reimbursed for all expenses, disbursements and advances,
including reasonable attorneys’ fees, incurred or made by Escrow Agent in
connection with the carrying out of its duties hereunder. Escrow Agent’s fees
(which shall be
$                    )
and all such expenses, disbursements and advances shall be borne by Seller.


 


e.                                       Any action claimed to be required to be taken
by Escrow Agent hereunder and not otherwise specifically set forth herein shall
require the agreement of Purchaser, Seller and Escrow Agent.


 


4.                                       Resignation of Escrow Agent. If Escrow Agent
desires to resign as Escrow Agent, it shall provide thirty (30) days written
notice (a “Resignation Notice”) of its intention to so resign to Purchaser and
to Seller. Upon receipt of a Resignation Notice, Purchaser and Seller shall
agree on a successor escrow agent mutually acceptable to Purchaser and Seller,
which successor shall agree in writing to be bound by the terms hereof. If
Seller and Purchaser cannot agree on a successor escrow agent, Escrow Agent
shall turn over the Escrowed Funds to a court of competent jurisdiction in the
State of Texas.


 


5.                                       Amendments. No modification or amendment to
this Escrow Agreement, or waiver of compliance with any provision or condition
hereof shall be valid unless reduced to writing and signed by all of the
parties hereto.


 


6.                                       Effect of this Escrow Agreement. This Escrow
Agreement sets forth the entire understanding of the parties with respect to
the subject matter hereof and supersedes any and all prior agreements,
arrangements and understandings relating to the subject matter hereof. This
Escrow Agreement shall be binding upon and inure to the benefit of the parties
and their respective successors and legal representatives. The paragraph
headings of this Escrow Agreement are for convenience of reference only and do
not form a part hereof and do not in any way modify, interpret or construe the
intentions of the parties. This Escrow Agreement shall be governed by and
construed in accordance with the laws of the State of Texas without regard to
its conflicts of laws principles, and the state and federal courts of Texas
shall have exclusive jurisdiction over any controversy or claim arising out of
or relating to this Agreement.


 


7.                                       Notices. All notices and demands hereunder
shall be in writing, and shall be delivered by courier, by registered or
certified mail, return receipt requested, or by facsimile transmission and
shall be deemed given two (2) business days after deposited in the United
States Mail with sufficient postage prepaid thereon to carry it to its
addressed destination, or when delivered by courier or facsimile transmission
(with hard copy sent no later than 24 hours following transmission), and
addressed as follows:


 


	
  To Seller:

  	
   

  	
  c/o Prime Group Realty
  Trust

  
	
   

  	
   

  	
  77 West Wacker Drive

  
	
   

  	
   

  	
  Suite 3900

  
	
   

  	
   

  	
  Chicago, Illinois 60601

  
	
   

  	
   

  	
  Attention: Mr. Jeffrey A.
  Patterson

  
	
   

  	
   

  	
   

  
	
  with a copy to:

  	
   

  	
  c/o Prime Group Realty
  Trust

  



 

















 


	
   

  	
   

  	
  77 West Wacker Drive

  
	
   

  	
   

  	
  Suite 3900

  
	
   

  	
   

  	
  Chicago, Illinois 60601

  
	
   

  	
   

  	
  Attention: Mr. James F.
  Hoffman

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  To Purchaser:

  	
   

  	
  CenterPoint Properties
  Trust

  
	
   

  	
   

  	
  1808 Swift Drive

  
	
   

  	
   

  	
  Oak Brook, Illinois 60523

  
	
   

  	
   

  	
  Attention: Mr. Paul T.
  Ahern

  
	
   

  	
   

  	
   

  
	
  To Escrow Holder:

  	
   

  	
  Chicago Title and Trust
  Company

  
	
   

  	
   

  	
  171 North Clark Street

  
	
   

  	
   

  	
  Chicago, Illinois 60601

  
	
   

  	
   

  	
  Attn: Ms. Nancy Castro

  



 


Such addresses may be changed at any time and
from time to time, by notice as above provided.


 


8.                                       Counterparts. This Escrow Agreement may be
executed in two or more counterparts, and by the different parties hereto on
separate counterparts, each of which shall be deemed an original but all of
which shall constitute one and the same Agreement.


 


[Signature
Page Follows]


 

















 


IN WITNESS WHEREOF, the parties have executed
this Escrow Agreement as of the date first above written.


 


	
  SELLER:

  	
   

  	
  PRIME GROUP REALTY, L.P.,
  a Delaware limited partnership, individually and in its capacity as the sole
  administrative member of the Owners

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Prime Group Realty Trust,

  
	
   

  	
   

  	
   

  	
  its Managing General
  Partner

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Its:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  PURCHASER:

  	
   

  	
  CENTERPOINT PROPERTIES
  TRUST,

  
	
   

  	
   

  	
    a Maryland
  real estate investment trust

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Its:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Its:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Accepted this
          day of

  July, 2004

  	
   

  	
   

  	
   

  
	
  Chicago Title and Trust
  Company

  Escrow Holder

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  	
   

  	
   

  
																		



 

















 


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