**Exhibit 10.11**

** **

**GRAMERCY CAPITAL CORP.**

**1,000,000 SHARES**

**CONTROLLEDEQUITY OFFERING**SMSALES AGREEMENT

May 10, 2006

 

CANTOR FITZGERALD &CO.110 East 59th StreetNew York, NY 10022

Ladies and Gentlemen:

GRAMERCY CAPITAL CORP., a Maryland corporation (the “**Company**”), GKK Capital LP, aDelaware limited partnership (the “**Operating Partnership**”),and GKK Manager, LLC, a Delaware limited liability company and the manager ofthe Company and the Operating Partnership (together with its affiliates, the “**Manager**”) confirms their respectiveagreements (this “**Agreement**”)with Cantor Fitzgerald & Co. (“**CF&Co**”),as follows:

# 1. Issuance andSale of Shares. The Company agrees that, from time to time during the termof this Agreement, on the terms and subject to the conditions set forth herein,it may issue and sell through CF&Co, acting as agent and/or principal, (a) upto 1,000,000 shares (the****“**Shares**”) of the Company’s commonstock, par value $0.001 per share (the “**Common Stock**”).Notwithstanding anything to the contrary contained herein, and provided thatCF&Co complies with the Placement Notice (as defined herein), the partieshereto agree that compliance with the limitation set forth in this Section 1on the number and aggregate market value of Shares issued and sold under thisAgreement shall be the sole responsibility of the Company, and CF&Co shallhave no obligation in connection with such compliance. The issuance and sale ofShares through CF&Co will be effected pursuant to the RegistrationStatement (as defined below) filed by the Company and declared effective by theSecurities and Exchange Commission (the “**Commission**”),although nothing in this Agreement shall be construed as requiring the Companyto use the Registration Statement to issue Common Stock.

# The Company filedon August 31, 2005, in accordance with the provisions of the SecuritiesAct of 1933, as amended, and the rules and regulations thereunder(collectively, the “**Securities Act**”),with the Commission a registration statement on Form S-3 (File No. 333-1280130),including a base prospectus, relating to certain securities, including theShares to be issued from time to time by the Company, and which incorporates byreference documents that the Company has filed or will file in accordance withthe provisions of the Securities Exchange Act of 1934, as amended, and the rules andregulations thereunder (collectively, the “**Exchange Act**”).The Company has prepared a prospectus supplement specifically relating to theShares (the “**Prospectus Supplement**”) to thebase prospectus included as part of such registration statement. The Companyhas furnished to CF&Co, for use by CF&Co, copies of the prospectus

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# included as part of suchregistration statement, as supplemented by the Prospectus Supplement, relatingto the Shares. Except where the context otherwise requires, such registrationstatement, as amended when it became effective, including all documents filedas part thereof or incorporated by reference therein, and including anyinformation contained in a Prospectus (as defined below) subsequently filedwith the Commission pursuant to Rule 424(b) under the Securities Actand also including any other registration statement filed pursuant to Rule 462(b) underthe Securities Act, collectively, are herein called the “**RegistrationStatement**,” and the base prospectus, including all documentsincorporated therein by reference, included in the Registration Statement, asit may be supplemented by the Prospectus Supplement, in the form in which such prospectus and/or Prospectus Supplementhave most recently been filed by the Company with the Commissionpursuant to Rule 424(b) under the Securities Act, together with any“issuer free writing prospectus,” as defined in Rule 433 of the 1933 ActRegulations (“**Rule 433**”), relating to theShares that (i) is required to be filed with the Commission by the Company or(ii) is exempt from filing pursuant to Rule 433(d)(5)(i), in each case in theform filed or required to be filed with the Commission or, if not required tobe filed, in the form retained in the Company’s records pursuant to Rule433(g), is herein called the “**Prospectus**.”Any reference herein to the Registration Statement, the Prospectus or anyamendment or supplement thereto shall be deemed to refer to and include thedocuments incorporated by reference therein, and any reference herein to theterms “amend,” “amendment” or “supplement” with respect to the RegistrationStatement or the Prospectus shall be deemed to refer to and include the filingafter the execution hereof of any document with the Commission deemed to beincorporated by reference therein. For purposes of this Agreement, allreferences to the Registration Statement, the Prospectus or to any amendment orsupplement thereto shall be deemed to include any copy filed with theCommission pursuant to its Electronic Data Gathering Analysis and RetrievalSystem (“**EDGAR**”).

# 2. Placements.Each time that the Company wishes to issue and sell Shares hereunder (each, a “**Placement**”), it will notifyCF&Co by email notice (or other method mutually agreed to in writing by theParties) containing the parameters in accordance with which it desires theShares to be sold, which shall at a minimum include the number of Shares (the “**Placement Shares**”) to be issued,the time period during which sales are requested to be made, any limitation onthe number of Shares that may be sold in any one day and any minimum pricebelow which sales may not be made (a “**Placement Notice**”),a form of which containing such minimum sales parameters necessary is attachedhereto as **Schedule 1**. The PlacementNotice shall originate from any of the individuals from the Company set forthon **Schedule 3**(with a copy to each ofthe other individuals from the Company listed on such schedule), and shall beaddressed to each of the individuals from CF&Co set forth on **Schedule 3**, as such **Schedule 3** may be amended from timeto time. The Placement Notice shall be effective upon receipt by CF&Counless and until (i) in accordance with the notice requirements set forthin Section 4, CF&Co declines to accept the terms containedtherein for any reason, in its sole discretion, (ii) the entire amount ofthe Placement Shares have been sold, (iii) in accordance with the noticerequirements set forth in Section 4, the Company suspends or terminatesthe Placement Notice, (iv) the Company issues a subsequent PlacementNotice with parameters superseding those on the earlier dated Placement Notice,or (iv) the Agreement has been terminated under the provisions of Section 10. The amount of any discount, commissionor other compensation to be paid by the Company to CF&Co in connection withthe sale of the Placement Shares shall be calculated in accordance with theterms set forth in **Schedule 2.**Itis expressly acknowledged and agreed that neither the Company nor CF&Cowill have any obligation whatsoever with respect to a Placement or anyPlacement Shares unless and until the Company delivers a Placement Notice toCF&Co and CF&Co does not decline such Placement Notice pursuant to the termsset forth above, and then only upon the terms specified therein and herein. Inthe event of

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# a conflict between theterms of this Agreement and the terms of a Placement Notice, the terms of thePlacement Notice will control.

# 3. Sale ofPlacement Shares by CF&Co. Subject to the terms and conditions hereinset forth, upon the Company’s issuance of a Placement Notice, and unless thesale of the Placement Shares described therein has been declined, suspended, orotherwise terminated in accordance with the terms of this Agreement, CF&Co,for the period specified in the Placement Notice, will use its commerciallyreasonable efforts consistent with its normal trading and sales practices tosell such Placement Shares up to the amount specified, and otherwise in accordancewith the terms of such Placement Notice. CF&Co will provide writtenconfirmation to the Company no later than the opening of the Trading Day (asdefined below) immediately following the Trading Day on which it has made salesof Placement Shares hereunder setting forth the number of Placement Shares soldon such day, the compensation payable by the Company to CF&Co pursuant to Section 2with respect to such sales, and the Net Proceeds (as defined below) payable tothe Company, with an itemization of the deductions made by CF&Co (as setforth in Section 5(a)) from the gross proceeds that it receives from suchsales. After consultation to the Company and subject to the terms of thePlacement Notice, CF&Co may sell Placement Shares by any method permittedby law deemed to be an “at the market” offering as defined in Rule 415 ofthe Securities Act, including without limitation sales made directly on the NewYork Stock Exchange(the “**Exchange**”), on any other existingtrading market for the Common Stock or to or through a market maker. Afterconsultation with the Company and subject to the terms of the Placement Notice,CF&Co may also sell Placement Shares in privately negotiated transactions. TheCompany acknowledges and agrees that (i) there can be no assurance thatCF&Co will be successful in selling Placement Shares, and (ii) CF&Cowill incur no liability or obligation to the Company or any other person orentity if it does not sell Placement Shares for any reason other than a failureby CF&Co to use its commercially reasonable efforts consistent with itsnormal trading and sales practices to sell such Placement Shares as requiredunder this Section 3. For the purposes hereof, “**Trading Day**” means any day on whichCommon Stock is purchased and sold on the principal market on which the CommonStock is listed or quoted.

# 4. Suspensionof Sales. The Company or CF&Co may, upon notice to the other party inwriting (including by email correspondence to each of the individuals of theother Party set forth on **Schedule 3,**ifreceipt of such correspondence is actually acknowledged by any of theindividuals to whom the notice is sent, other than via auto-reply) or bytelephone (confirmed immediately by verifiable facsimile transmission or emailcorrespondence to each of the individuals of the other Party set forth on **Schedule 3**), suspend any sale ofPlacement Shares; *provided, however*,that such suspension shall not affect or impair either party’s obligations withrespect to any Placement Shares sold hereunder prior to the receipt of suchnotice. Except as set forth in Section 11 herein, each of theParties agrees that no such notice under this Section 4 shall beeffective against the other unless it is made to one of the individuals namedon **Schedule 3** hereto, as such Schedulemay be amended from time to time.

# 5. Settlement.

## (a) Settlement of Placement Shares. Unless otherwisespecified in the applicable Placement Notice, settlement for sales of PlacementShares will occur on the third (3rd) Trading Day (or such earlier day as isindustry practice for regular-way

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## trading)following the date on which such sales are made (each, a “**Settlement Date**”). The amount ofproceeds to be delivered to the Company on a Settlement Date against receipt ofthe Placement Shares sold (the “**NetProceeds**”) will be equal to the aggregate sales price receivedby CF&Co at which such Placement Shares were sold, after deduction for (i) CF&Co’scommission, discount or other compensation for such sales payable by theCompany pursuant to Section 2 hereof, (ii) any other amountsdue and payable by the Company to CF&Co hereunder pursuant to Section 7(g) (Expenses)hereof, and (iii) any transaction fees imposed by any governmental orself-regulatory organization in respect of such sales.

## (b) Deliveryof Placement Shares. On or before each Settlement Date, the Company will,or will cause its transfer agent to, electronically transfer the PlacementShares being sold by crediting CF&Co’s or its designee’s account at TheDepository Trust Company through its Deposit and Withdrawal at Custodian Systemor by such other means of delivery as may be mutually agreed upon by theparties hereto which in all cases shall be freely tradeable, transferable,registered shares in good deliverable form. On each Settlement Date, CF&Cowill deliver the related Net Proceeds in same day funds to an accountdesignated by the Company on, or prior to, the Settlement Date. The Companyagrees that if the Company defaults in its obligation to deliver PlacementShares on a Settlement Date, the Company agrees that in addition to and in noway limiting the rights and obligations set forth in Section 9(a) (Indemnificationand Contribution) hereto, it will (i) hold CF&Co harmless against anyloss, claim, damage, or expense (including reasonable out-of-pocket fees andexpenses of external counsel), as incurred, arising out of or in connectionwith such default by the Company and (ii) pay to CF&Co any commission,discount, or other compensation to which it would otherwise have been entitledabsent such default.

# 6. Representationsand Warranties.

## (a) The Company and the Operating Partnership each severallyrepresents and warrants to, and agrees with, CF&Co that as of the date ofthis Agreement and as of each Representation Date (as defined in Section 7(m) below)on which a certificate is required to be delivered pursuant to Section 7(m) ofthis Agreement and as of each Applicable Time, as the case may be:

### (1)                                  RegistrationStatement and Prospectus. The Company meets the requirements for use of Form S-3under the Securities Act. The Registration Statement has been filed with theCommission and has been declared effective under the Securities Act. TheRegistration Statement or Prospectus has named CF&Co as an underwriter,acting as principal and/or agent that the Company might engage in the sectionentitled “Plan of Distribution.”  TheCompany has not received, and has no notice of, any order of the Commissionpreventing or suspending the use of the Registration Statement, or threateningor instituting proceedings for that purpose. Copies of the RegistrationStatement, the Prospectus, and any such amendments or supplements and alldocuments incorporated by

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### referencetherein that were filed with the Commission on or prior to the date of thisAgreement have been delivered, or made available through EDGAR, to CF&Coand their counsel. The Company has not distributed and will not distribute anyoffering material in connection with the offering or sale of the PlacementShares other than the Registration Statement or the Prospectus. The CommonStock is currently listed on the Exchange under the trading symbol “GKK.”

### (2)                                  NoMisstatement or Omission. The Registration Statement, at each deemedeffective date with respect to CF&Co pursuant to Rule 430B(f)(2) ofthe Securities Act will comply in all material respects with the requirementsof the Securities Act and did not, or will not, contain an untrue statement ofa material fact or omit to state a material fact required to be stated thereinor necessary to make the statements therein not misleading. The Prospectus andany amendment or supplement thereto, on the date thereof at each ApplicableTime and at Settlement Date, did not or will not include an untrue statement ofa material fact or omit to state a material fact necessary to make thestatements therein, in light of the circumstances under which they were made,not misleading. The foregoing shall not apply to statements in, or omissionsfrom, any such document made in reliance upon, and in conformity with,information furnished to the Company by CF&Co specifically for use in thepreparation thereof.

### (3)                                  CompanyAuthorization of Agreement. This Agreement and the transactionscontemplated herein have been duly and validly authorized by the Company andthis Agreement has been duly and validly executed and delivered by the Company.

### (4)                                  OperatingPartnership Authorization of Agreement. This Agreement and the transactionscontemplated herein have been duly and validly authorized by the OperatingPartnership and this Agreement has been duly and validly executed and deliveredby the Operating Partnership.

### (5)                                  Authorizationof Management Agreement and Origination Agreement. The amended and restatedmanagement agreement (the “**ManagementAgreement**”), effective as of April 19, 2006, among theCompany, the Operating Partnership and the Manager has been duly authorized,executed and delivered by each of the Company and the Operating Partnership andconstitutes a valid and binding agreement of each of the Company and theOperating Partnership enforceable in accordance with its terms, except to theextent that enforcement thereof may be limited by bankruptcy, insolvency,reorganization or other laws affecting enforcement of creditors’ rights or bygeneral equitable principles. The amended and restated origination agreement(the “**Origination Agreement**”),effective as of April 19, 2006, among the Company, the OperatingPartnership and SL Green Operating Partnership, L.P. has been

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### dulyauthorized, executed and delivered by each of the Company and the OperatingPartnership and constitutes a valid and binding agreement of each of theCompany and the Operating Partnership enforceable in accordance with its terms,except to the extent that enforcement thereof may be limited by bankruptcy,insolvency, reorganization or other laws affecting enforcement of creditors’rights or by general equitable principles.

### (6)                                  FinancialStatements. The financial statements of the Company and its subsidiaries,together with the related schedules (if any) and notes (the “**Company Financial Statements**”), and anyfinancial statements required by Rule 3-14 of Regulation S-X (the “**Acquisition Financial Statements**”),included in the Registration Statement and the Prospectus present fairly thefinancial position of the Company and its consolidated subsidiaries at thedates indicated, or with respect to the Acquisition Financial Statements, therespective property or tenant; and all such financial statements have beenprepared in conformity with GAAP applied on a consistent basis (except asotherwise noted herein) throughout the periods involved and comply with allapplicable accounting requirements under the Securities Act. The supportingschedules, if any, included in the Registration Statement present fairly, inaccordance with GAAP, the information required to be stated therein. There areno financial statements or schedules required to be included in the Prospectuswhich are not so included. The unaudited pro forma financial information(including the related notes) included in the Prospectus and any preliminaryProspectus complies as to form in all material respects with the applicableaccounting requirements of the Securities Act, and management of the Companybelieves that the assumptions underlying the pro forma adjustments arereasonable. Such pro forma adjustments have been properly applied to thehistorical amounts in the compilation of the information and such informationfairly presents with respect to the Company and its consolidated subsidiaries,the financial position, results of operations and other information purportedto be shown therein at the respective dates and for the respective periodsspecified. No pro forma financial information is required to be included in theProspectus which is not so included.

### (7)                                  NoMaterial Adverse Change in Business. Since the respective dates as of whichinformation is given in the Registration Statement and the Prospectus (in eachcase exclusive of any amendments or supplements thereto subsequent to the dateof this Agreement), except as otherwise stated therein, (A) there has beenno material adverse change or any development involving a prospective materialadverse change in the operations, condition (financial or otherwise), or in theearnings, business affairs or business prospects of the Company and itssubsidiaries, including, without limitation, the Operating Partnership,considered as one enterprise, whether or not arising in the ordinary course ofbusiness (a

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### “**Material Adverse Effect**”),and (B) since the date of the latest balance sheet presented in theRegistration Statement and Prospectus, neither the Company nor any of itssubsidiaries has incurred or undertaken any liabilities or obligations, director contingent, which are material to the Company and its subsidiaries consideredas one enterprise, except for liabilities or obligations which are described inthe Registration Statement and the Prospectus.

### (8)                                  GoodStanding of the Company and the Operating Partnership. The Company has beenduly organized and is validly existing as a corporation in good standing underthe laws of the State of Maryland and has power and authority to own, lease andoperate its properties and to conduct its business as described in theProspectus and to enter into and perform its obligations under this Agreement;and the Operating Partnership has been duly formed and is validly existing as alimited partnership in good standing under the laws of the State of Delawareand has authority to own, lease and operate its properties and to conduct its businessas described in the Prospectus. Each of the Company and the OperatingPartnership is duly qualified as a foreign corporation to transact business andis in good standing in the State of New York and in each other jurisdiction inwhich such qualification is required, whether by reason of the ownership orleasing of property or the conduct of business, except (solely in the case ofjurisdictions other than the State of New York) where the failure so to qualifyor to be in good standing would not result in a Material Adverse Effect.

### (9)                                  ThePartnership Agreement. The Third Amended and Restated Agreement of LimitedPartnership of the Operating Partnership (the “**Partnership Agreement**”) has been duly and validlyauthorized, executed and delivered by the Company and is a valid and bindingagreement, enforceable against the Company in accordance with its terms, exceptto the extent that enforcement thereof may be limited by bankruptcy,insolvency, reorganization or other laws affecting enforcement of creditors’rights or by general equitable principles. The Partnership Agreement has beenduly executed and delivered by the other parties thereto and, to the Company’sknowledge, is a valid and binding agreement enforceable against such parties inaccordance with its terms, except to the extent that enforcement thereof may belimited by bankruptcy, insolvency, reorganization or other laws affectingenforcement of creditors’ rights or by general equitable principles.

### (10)                            GoodStanding of Subsidiaries. Each subsidiary of the Company listed on **Exhibit A** hereto has been dulyorganized and is validly existing as a corporation, limited or generalpartnership or limited liability company, as the case may be, in good standingunder the laws of the jurisdiction of its organization, has power and authorityto conduct its business as described in the Prospectus and is duly qualified asa foreign corporation, limited or

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### generalpartnership or limited liability company, as the case may be, to transactbusiness and is in good standing in each jurisdiction in which suchqualification is required, whether by reason of the ownership or leasing ofproperty or the conduct of business, except where the failure so to qualify orto be in good standing would not result in a Material Adverse Effect; except asotherwise disclosed in the Registration Statement and the Prospectus, all ofthe issued and outstanding stock of each such subsidiary that is a corporation,all of the issued and outstanding partnership interests of each such subsidiarythat is a limited or general partnership and all of the issued and outstandinglimited liability company interests, membership interests or other similarinterests of each such subsidiary that is a limited liability company have beenduly authorized and validly issued, and, in the case of each subsidiary that isa corporation, are fully paid and nonassessable and are owned by the Company orthe Operating Partnership, directly or indirectly, free and clear of any lien;and none of the outstanding shares of stock, partnership interests or limitedliability company interests, membership interests or other similar interests ofany such subsidiary was issued in violation of any preemptive rights, rights offirst refusal or other similar rights of any securityholder of such subsidiaryor any other person. The only subsidiaries of the Company are the subsidiarieslisted on **Exhibit A** heretoand **Exhibit A** accurately setsforth whether each such subsidiary is a corporation, limited or generalpartnership or limited liability company and the jurisdiction of organizationof each such subsidiary and, in the case of any subsidiary which is apartnership or limited liability company, its general partners and managingmembers, respectively. Any subsidiaries of the Company which are “significantsubsidiaries” as defined by Rule 1-02 of Regulation S-X are listedon Exhibit A hereto under the caption “Significant Subsidiaries.”

### (11)                            Capitalization.The authorized, issued and outstanding stock of the Company is as set forthunder the caption “Capitalization” in the Prospectus. The issued andoutstanding shares of stock of the Company have been duly authorized and arevalidly issued, fully paid and nonassessable; and none of the outstandingshares of stock of the Company was issued in violation of any preemptiverights, rights of first refusal or other similar rights of any securityholderof the Company or any other person. The authorized, issued and outstandingunits of partnership interest in the Operating Partnership, including the Class BLimited Partner interests (the “**OP Units**”),have been duly authorized and validly issued; and all of such OP Units havebeen sold in compliance with applicable laws (including, without limitation,federal and state securities laws).

### (12)                            Authorizationof Securities. The Placement Shares have been duly authorized for issuanceand sale to CF&Co pursuant to this Agreement and, when issued and deliveredby the Company pursuant to this

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### Agreementagainst payment of the consideration set forth herein, will be validly issued,fully paid and nonassessable; no holder of the Placement Shares is or will besubject to personal liability by reason of being such a holder; and theissuance of the Placement Shares is not subject to any preemptive right, rightof first refusal or other similar right of any securityholder of the Company orany other person, except for the rights of SL Green Realty Corp. (“**SL Green**”) pursuant to the OriginationAgreement, as described in the Prospectus.

### (13)                            Absenceof Defaults and Conflicts. Neither the Company, the Operating Partnershipnor any of their respective subsidiaries is in violation of its OrganizationalDocuments or in default in the performance or observance of any obligation,agreement, covenant or condition contained in any Company Document, except forsuch defaults that would not result in a Material Adverse Effect. Theexecution, delivery and performance of this Agreement and the consummation ofthe transactions contemplated herein and in the Registration Statement and theProspectus (including the issuance and sale of the Securities and the use ofthe proceeds from the sale of the Securities as described in the Prospectusunder the caption “Use of Proceeds”) and compliance by each of the Company andthe Operating Partnership with its obligations under this Agreement do not andwill not, whether with or without the giving of notice or passage of time orboth, conflict with or constitute a breach of, or default under, or result inthe creation or imposition of any Lien upon any property or assets of theCompany, the Operating Partnership or any of their respective subsidiariespursuant to any Company Documents, nor will such action result in any violationof the provisions of the Organizational Documents of the Company, the OperatingPartnership or any of their respective subsidiaries or any applicable law,statute, rule, regulation, judgment, order, writ or decree of any government,government instrumentality or court, domestic or foreign, having jurisdictionover the Company or any of its subsidiaries or any of their respective assets,properties or operations.

### (14)                            Absenceof Proceedings. There is no action, suit, proceeding, inquiry orinvestigation before or brought by any court or governmental agency or body,domestic or foreign, now pending, against or affecting the Company, theOperating Partnership or any of their respective subsidiaries or which has as asubject thereof, any officer or director of the Company in their capacity assuch or as would otherwise be required to be disclosed in the Prospectus. Tothe knowledge of the Company or the Operating Partnership, there is no action,suit, proceeding, inquiry or investigation before or brought by any court orgovernmental agency or body, domestic or foreign, threatened, against oraffecting the Company, the Operating Partnership or any of their respectivesubsidiaries except as would not have a Material Adverse Effect or which has asa subject thereof, any officer or director of the Company in their capacity assuch or as would otherwise be required to be disclosed in the Prospectus.

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### (15)                            IndependentPublic Accountant. Ernst & Young LLP (**“E&Y”**), who certified the financial statements andsupporting schedules included in the Registration Statement and the Prospectus,are independent public accountants as required by the Securities Act and theExchange Act.

### (16)                            Accuracyof Descriptions and Exhibits. The information in the Prospectus under thecaptions “Description of Common Stock,” “Certain Provisions of Maryland Law andof Our Charter and Bylaws,” “The Operating Partnership Agreement” and “MaterialU.S. Federal Income Tax Considerations” is correct in all material respects;all descriptions in the Registration Statement and the Prospectus of anyCompany Documents are accurate in all material respects; and there are nofranchises, contracts, indentures, mortgages, deeds of trust, loan or creditagreements, bonds, notes, debentures, evidences of indebtedness, leases orother instruments or agreements required to be described or referred to in theRegistration Statement or the Prospectus or to be filed as exhibits to theRegistration Statement which have not been so described and filed as required. Thestatistical and market-related data included in the Prospectus are based on orderived from sources which the Company and the Operating Partnership believe tobe reliable and accurate.

### (17)                            Possessionof Intellectual Property. The Company, the Operating Partnership and theirrespective subsidiaries own or possess or have the right to use on reasonableterms all patents, patent rights, patent applications, licenses, inventions,copyrights, know-how (including trade secrets and other unpatented and/orunpatentable proprietary or confidential information, systems or procedures),trademarks, service marks, trade names, service names and other intellectualproperty (collectively, “**IntellectualProperty**”) necessary to carry on their respective businesses asdescribed in the Prospectus and as proposed to be conducted; and neither theCompany, the Operating Partnership nor any of their respective subsidiaries hasreceived any notice or is otherwise aware of any infringement of or conflictwith asserted rights of others with respect to any Intellectual Property or ofany facts or circumstances which would render any Intellectual Property invalidor inadequate to protect the interest of the Company, the Operating Partnershipor any of their respective subsidiaries therein, and which infringement orconflict (if the subject of any unfavorable decision, ruling or finding) orinvalidity or inadequacy, individually or in the aggregate, would result in aMaterial Adverse Effect.

### (18)                            Absenceof Further Requirements. (A) No filing with, or authorization,approval, consent, license, order, registration, qualification or decree of,any court or governmental authority or agency, domestic or foreign, (B) noauthorization, approval, vote or other consent of any stockholder or creditorof the Company or the Operating Partnership, (C) no waiver or consentunder any Company Document, and (D) no authorization,

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### approval, voteor other consent of any other person or entity, is necessary or required forthe performance by the Company or the Operating Partnership of their respectiveobligations under this Agreement, for the offering, issuance, sale or deliveryof the Securities hereunder, or for the consummation of any of the othertransactions contemplated by this Agreement, in each case on the termscontemplated by the Prospectus, except such as have been already obtained underthe 1933 Act or the 1933 Act Regulations or such as may be required under statesecurities laws.

### (19)                            Possessionof Licenses and Permits. The Company, the Operating Partnership and theirrespective subsidiaries possess such permits, licenses, approvals, consents andother authorizations issued by the appropriate federal, state, local or foreignregulatory agencies or bodies (collectively, “**Governmental Licenses**”) as are necessary to conduct thebusiness now operated by them; the Company and its subsidiaries are incompliance with the terms and conditions of all such Governmental Licenses,except where the failure so to comply would not, individually or in theaggregate, have a Material Adverse Effect; all of the Governmental Licenses arevalid and in full force and effect, except when the invalidity of suchGovernmental Licenses or the failure of such Governmental Licenses to be infull force and effect would not have a Material Adverse Effect; and neither theCompany, the Operating Partnership nor any of their respective subsidiaries hasreceived any notice of proceedings relating to the revocation or modificationof any such Governmental Licenses which, individually or in the aggregate, ifthe subject of an unfavorable decision, ruling or finding, would result in aMaterial Adverse Effect.

### (20)                            Absenceof Registration Rights. Except as disclosed in the Prospectus, there are nopersons with registration rights or other similar rights to have any securities(debt or equity) (A) registered pursuant to the Registration Statement orincluded in the offering contemplated by this Agreement or (B) otherwiseregistered by the Company under the 1933 Act. There are no persons withtag-along rights or other similar rights to have any securities (debt orequity) included in the offering contemplated by this Agreement or sold inconnection with the sale of Securities by the Company pursuant to thisAgreement.

### (21)                            JointVentures. All of the joint ventures in which the Company or any subsidiaryowns any interest (the “**Joint Ventures**”)are listed in **Exhibit B**hereto.

### (22)                            1934Act Registration; New York Stock Exchange. The Common Stock has beenregistered pursuant to Section 12(b) of the 1934 Act. The outstandingshares of Common Stock and the Securities being sold hereunder will have beenapproved for listing, subject only to official notice of issuance, on the NYSE.

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### (23)                            NASDMatters. All of the information (including, but not limited to, informationregarding affiliations, security ownership and trading activity) provided toCF&Co or to counsel for CF&Co by the Company, its officers anddirectors and the holders of any securities (debt or equity) or options toacquire any securities of the Company in connection with letters, filings orother supplemental information provided to NASD Regulation Inc. pursuant toNASD Conduct Rule 2710 or 2720 is true, complete and correct.

### (24)                            Insurance.The Company, the Operating Partnership and each of their respectivesubsidiaries are insured by insurers of recognized financial responsibilityagainst such losses and risks and in such amounts as are prudent and customaryin the businesses in which they are engaged; all policies of insurance and anyfidelity or surety bonds insuring the Company, the Operating Partnership or anyof their respective subsidiaries or their respective businesses, assets,employees, officers and directors are in full force and effect; the Company,the Operating Partnership and their respective subsidiaries are in compliancewith the terms of such policies and instruments in all material respects; thereare no claims by the Company, the Operating Partnership or any of theirrespective subsidiaries under any such policy or instrument as to which anyinsurance company is denying liability or defending under a reservation ofrights clause; neither the Company, the Operating Partnership nor any suchsubsidiary has been refused any insurance coverage sought or applied for; andneither the Company, the Operating Partnership nor any such subsidiary has anyreason to believe that it will not be able to renew its existing insurancecoverage as and when such coverage expires or to obtain similar coverage fromsimilar insurers as may be necessary to continue its business at a cost thatwould not have a Material Adverse Effect.

### (25)                            DisclosureControls and Procedures. The Company and the Operating Partnership haveestablished and maintain disclosure controls and procedures (as such term isdefined in Rule 13a-15(e) under the Exchange Act) that (i) aredesigned to ensure that material information required to be disclosed by theCompany in the reports that it files or submits under the Exchange Act isaccumulated and communicated to the Company’s management, including the Company’sprincipal executive officer and principal financial officer, particularlyduring the preparation of the reports that it files or submits under theExchange Act; and (ii) are effective to ensure that information requiredto be disclosed by the Company in the reports that it files or submits underthe Exchange Act is recorded, processed, summarized and reported within thetime periods specified in the Commission’s rules and forms.

### (26)                            AccountingControls. The Company and its subsidiaries maintain a system of internalcontrol over financial reporting sufficient to provide reasonable assurancethat financial reporting is reliable and financial

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### statements forexternal purposes are prepared in accordance with GAAP and includes policiesand procedures that (i) pertain to the maintenance of records that inreasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the Company; (ii) provide reasonableassurance that transactions are recorded as necessary to permit preparation offinancial statements in accordance with GAAP, and to maintain assetaccountability; (iii) access to assets is permitted only in accordancewith management’s general or specific authorization; and (iv) the recordedaccountability for assets is compared with the existing assets at reasonableintervals and appropriate action is taken with respect to any differences.

### (27)                            Absenceof Manipulation. Each of the Company and the Operating Partnership has nottaken and will not take, directly or indirectly, any action designed to or thatwould constitute or that might reasonably be expected to cause or result in thestabilization or manipulation of the price of any security to facilitate thesale or resale of the Shares.

### (28)                            ERISA.Except as set forth in the Company’s financial statements, each of the Companyand the Operating Partnership does not have any material liabilities under theEmployee Retirement Income Security Act of 1974, as amended, or Section 4975of the Internal Revenue Code of 1986, as amended from time to time

### (29)                            REITStatus. Commencing with its taxable year ended December 31, 2004, theCompany has been organized and operated in conformity with the requirements forqualification and taxation as a real estate investment trust (“**REIT**”) under the Internal Revenue Codeof 1986, as amended, and the regulations and published interpretationsthereunder (collectively, the “**Code**”),and the Company’s current and proposed method of operations as described in theProspectus will enable it to continue to meet the requirements forqualification and taxation as a REIT under the Code.

### (30)                            TaxReturns. All tax returns required to be filed as of the date hereof by theCompany and each of is subsidiaries have been timely filed (or valid extensionsto such filings have been obtained), all such tax returns are true, correct andcomplete in all material respects, and all material taxes and other assessmentsof a similar nature (whether imposed directly or through withholding) includingany interest, additions to tax or penalties applicable thereto due or claimedto be due from such entities have been paid, other than those being contestedin good faith and for which adequate reserves have been provided.

### (31)                            RelatedParty Transactions. There are no business relationships or related-partytransactions involving the Company, the Operating Partnership or the Managerrequired to be described in the Prospectus which have not been so described asrequired.

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### (32)                            NoUnlawful Contributions or Other Payments. Neither the Company, theOperating Partnership nor any subsidiary nor, to the best of the Company’sknowledge, any employee or agent of the Company, the Operating Partnership orany subsidiary, has made any contribution or other payment to any official of,or candidate for, any federal, state or foreign office in violation of any lawor of the character required to be disclosed in the Prospectus.

### (33)                            InvestmentCompany Act. The Company is not, and upon the issuance and sale of thePlacement Shares, as herein contemplated and the application of the netproceeds therefrom as described in the Prospectus, will not be, an “investmentcompany” or an entity “controlled” by an “investment company,” as such termsare defined in the Investment Company Act of 1940, as amended (the “**Investment Company Act**”).

### (34)                            Brokersand Finders. Neither the Company, the Operating Partnership nor any subsidiaryhas incurred any liability for a fee, commission or other compensation onaccount of the employment of a broker or finder in connection with thetransactions contemplated by this Agreement other than as contemplated hereby.

### (35)                            NoProhibition on Subsidiaries from Paying Dividends or Making Other Distributions.No subsidiary is currently prohibited, directly or indirectly, from paying anydividends to the Company, from making any other distribution on such subsidiary’scapital stock or other equity interests, from repaying to the Company any loansor advances to such subsidiary from the Company or from transferring any ofsuch subsidiary’s property or assets to the Company or any other Subsidiary.

### (36)                            Titleto Real and Personal Property. The Company and its subsidiaries, includingthe Operating Partnership, have (or in the case of a Joint Venture, suchlimited partnership, limited liability company or other joint venture entityhas) good and marketable title in fee simple to, or a valid leasehold interestin, any real property currently leased or owned or controlled by them, or to beleased or owned or to be controlled by them (collectively, the “RealProperty”) and good and marketable title to any and all personal propertyowned by the Company or any of its Subsidiaries that is material to thebusiness of the Company or the Operating Partnership, in each case free andclear of all liens, encumbrances and defects, except as described in theProspectus or such as would not reasonably be expected to result in a MaterialAdverse Effect; and any real property, buildings and equipment held under leaseby the Company and its subsidiaries are held by them under valid, subsistingand enforceable leases (the “Leases”) with such exceptions as aredisclosed in the Prospectus or such as would not reasonably be expected toresult in a Material Adverse Effect; (ii) neither the Company nor any ofits Subsidiaries has received notice of any claim that has been or may be

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### asserted byanyone adverse to the rights of the Company or any subsidiary with respect toany such Real Properties, personal property or Leases or affecting orquestioning the rights of the Company to the continued ownership, lease,possession or occupancy of such Real Properties, personal property or Leases,except for such claims that would not, individually or in the aggregate,reasonably be expected to have a Material Adverse Effect; (iii) no personor entity, including, without limitation, any tenant under the leases, if any,for the Real Properties has an option or right of first refusal or any otherright to purchase any of such Real Properties, except as disclosed in theProspectus; (iv) all of the Leases are in full force and effect, exceptwhere the failure to be in full force or effect would not, individually or inthe aggregate, reasonably be expected to have a Material Adverse Effect, andneither the Company nor any of its subsidiaries is in default in the payment ofany amounts due under any such Leases or in any other default thereunder andneither the Company nor any of its subsidiaries knows or an event which, withthe passage of time or the giving of notice or both, would constitute a defaultunder any such Lease, except such defaults that would not, individually or inthe aggregate, reasonably be expected to have a Material Adverse Effect; and (v) thereis no pending or, to the knowledge of the Company or its subsidiaries,threatened condemnation, zoning change, or other proceeding or action thatwould in any manner affect the size of, use of, improvements on, constructionon or access to any Real Property, except such proceedings or actions that,either individually or in the aggregate, would not reasonably be expected tohave a Material Adverse Effect.

### (37)                            TitleInsurance. The Company and its subsidiaries or as applicable, a JointVenture, has either (i) an owner’s or leasehold title insurance policy,from a title insurance company licensed to issue such policy, on any RealProperty, that insures the fee or leasehold interest, as the case may be, whichpolicies include only commercially reasonable exceptions, and with coverages inamounts at least equal to amounts that the Company believes are generallycommercially reasonable in the markets where the Real Properties are located or(ii) with respect to mortgage loans extended by the Company and itssubsidiaries, the Company or its subsidiary has one or more lender’s titleinsurance policies insuring the lien of the mortgages encumbering the realproperty underlying such loans with coverages, in the aggregate, equal to atleast the maximum aggregate principal amount of such loan.

### (38)                            Compliancewith Environmental Laws. Except to an extent that would not, individuallyor in the aggregate, reasonably be expected to result in a Material AdverseEffect or as otherwise disclosed in the Prospectus: (i) neither theCompany nor any of its subsidiaries nor, to the knowledge of the Company, anyother owners of the Real Property at any time, or to the knowledge of theCompany, any other party has at any time, handled, stored, treated,transported, manufactured, spilled, leaked, or discharged,

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### dumped,transferred or otherwise disposed of or dealt with, Hazardous Materials (ashereinafter defined) on, to or from any Real Property, other than by any suchaction taken in material compliance with all applicable Environmental Statutes(as hereinafter defined) or by the Company, any of its subsidiaries or anyother party in connection with the ordinary use of residential, retail orcommercial properties owned by the Company or any subsidiary; (ii) theCompany and its subsidiaries do not intend to use the Real Property or anysubsequently acquired properties for the purpose of handling, storing,treating, transporting, manufacturing, spilling, leaking, discharging, dumping,transferring or otherwise disposing of or dealing with Hazardous Materialsother than by any such action taken in material compliance with all applicableEnvironmental Statues or by the Company, any of its subsidiaries or, to theknowledge of the Company, any other party in connection with the ordinary useof residential, retail or commercial properties owned by the Company or anysubsidiary; (iii) the Company and the Operating Partnership do not know ofany seepage, leak, discharge, release, emission, spill, or dumping of HazardousMaterials from the Real Property into waters on or adjacent to the RealProperty or from the Real Property onto any real property owned or occupied byany other party, or onto lands from which Hazardous Materials might seep, flowor drain into such waters other than in material compliance with EnvironmentalStatutes; (iv) neither the Company nor any of its subsidiaries hasreceived any notice of, or has knowledge of, any occurrence or circumstancewhich, with notice or passage of time or both, would give rise to a claim underor pursuant to any U.S. federal, state or local environmental statute orregulation or under common law, pertaining to Hazardous Materials on ororiginating from any of the Real Property or arising out of the conduct of theCompany or any of its subsidiaries, including without limitation a claim underor pursuant to any Environmental Statute (as hereinafter defined); and (v) neitherthe Real Property is included nor, to the Company’s or the OperatingPartnership’s knowledge, is proposed for inclusion on the National PrioritiesList issued pursuant to CERCLA (as hereinafter defined) by United StatesEnvironmental Protection Agency (the “EPA”) or, to the Company’s or to theOperating Partnership’s knowledge, proposed for inclusion on any similar listor inventory issued pursuant to any other Environmental Statute or issued byany other governmental authority.

### As usedherein, “**Hazardous Materials**”shall include, without limitation, any flammable explosives, radioactivematerials, hazardous materials, hazardous wastes, toxic substances, or relatedmaterials, asbestos or any hazardous material as defined by any U.S. federal,state or local environmental law, ordinance, rule or regulation includingwithout limitation the Comprehensive Environmental Response, Compensation, andLiability Act of 1980, as amended, 42 U.S.C. Sections 9601-9675 (“**CERCLA**”), the Hazardous MaterialsTransportation Act, as amended, 49 U.S.C. Sections 1801-1819, theResource Conservation and Recovery Act, as amended, 42 U.S.C. Sections 6901-6992K,the Emergency Planning and Community Right-to-Know Act of 1986, 42 U.S.C.

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### Sections 11001-11050, the ToxicSubstances Control Act, 15 U.S.C. Sections 2601-2671, the FederalInsecticide, Fungicide and Rodenticide Act, 7 U.S.C. Sections 136-136y,the Clean Air Act, 42 U.S.C. Sections 7401-7642, the Clean Water Act(Federal Water Pollution Control Act), 33 U.S.C. Sections 1251-1387, theSafe Drinking Water Act, 42 U.S.C. Sections 300f-330j-26, and theOccupational Safety and Health Act, 29 U.S.C. Sections 651-678, as any ofthe above statutes may be amended from time to time, and in the regulationspromulgated pursuant to each of the foregoing (individually, an “**Environmental Statute**”) or by any governmentalauthority.

### (39)                            Compliancewith ADA. The Company and its subsidiaries and each Real Property arecurrently in compliance with all presently applicable provisions of theAmericans with Disabilities Act, as amended, except for any such non-compliancethat would not, individually or in aggregate, reasonably be expected to have aMaterial Adverse Effect.

### (40)                            Sarbanes-OxleyAct. The Company and each of the Company’s directors and officers, in theircapacities as such, are in full compliance with all applicable provisions ofthe Sarbanes-Oxley Act and the rules and regulations promulgated inconnection therewith, including Section 402 related to loans and Sections302 and 906 related to certifications.

### (41)                            S-3Eligibility. The conditions for the use by the Company of a registrationstatement on Form S-3 have been satisfied and the Company isentitled to use such form for the transactions contemplated herein.

## (b) Representationsand Warranties by the Manager. The Manager represents and warrants toCF&Co, and agrees with, CF&Co that as of the date of this Agreement andas of each Representation Date (as defined in Section 7(m) below)on which a certificate is required to be delivered pursuant to Section 7(m) ofthis Agreement, as the case may be:

### (1)                                  AccurateDisclosure. The information regarding the Manager in the Prospectus is trueand correct in all material respects.

### (2)                                  GoodStanding of the Manager. The Manager has been duly formed and is validlyexisting as a limited liability company in good standing under the laws of theState of Delaware and has power and authority to own, lease and operate itsproperties and to conduct its business as described in the Prospectus and toenter into and perform its obligations under this Agreement, the Management Agreement,the amended and restated asset servicing agreement between the Manager and SLGManagement Services LLC effective as of April 19, 2006 (the “**Asset Servicing Agreement**”) and theamended and restated outsource agreement between the Manager and SL GreenOperating Partnership, L.P. effective as of April 19, 2006 (the “**Outsource Agreement**”); and the Manageris duly qualified as a foreign limited liability company to transact businessand is in good standing in each other jurisdiction in which such qualificationis required,

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### whether byreason of the ownership or leasing of property or the conduct of business,except where the failure so to qualify or to be in good standing would notresult in a Material Adverse Effect.

### (3)                                  Authorizationof Management Agreement, Asset Servicing Agreement and Outsource Agreement.Each of this Agreement, the Management Agreement, the Asset Servicing Agreementand the Outsource Agreement (collectively, the “**Manager Agreements**”) has been duly authorized, executedand delivered by the Manager and constitutes a valid and binding agreement ofthe Manager enforceable in accordance with its terms, except to the extent thatenforcement thereof may be limited by bankruptcy, insolvency, reorganization orother laws affecting enforcement of creditors’ rights or by general equitableprinciples.

### (4)                                  Absenceof Defaults and Conflicts. The Manager is not in violation of itsOrganizational Documents or in default in the performance or observance of anyobligation, agreement, covenant or condition contained in any Company Document,Manager Agreement or otherwise, except for such defaults that would not resultin a Material Adverse Effect. The execution, delivery and performance of thisAgreement and the consummation of the transactions contemplated herein and inthe Manager Agreements and compliance by the Manager with its obligations underthis Agreement do not and will not, whether with or without the giving ofnotice or passage of time or both, conflict with or constitute a breach of, ordefault under, or result in the creation or imposition of any Lien upon anyproperty or assets of the Manager, nor will such action result in any violationof the provisions of the Organizational Documents of the Manager or anyapplicable law, statute, rule, regulation, judgment, order, writ or decree ofany government, government instrumentality or court, domestic or foreign,having jurisdiction over the Manager or any of its subsidiaries or any of theirrespective assets, properties or operations.

### (5)                                  Absenceof Proceedings. There is no action, suit, proceeding, inquiry orinvestigation before or brought by any court or governmental agency or body,domestic or foreign, now pending, or, to the knowledge of the Manager,threatened, against or affecting the Manager.

### (6)                                  Absenceof Further Requirements. (A) No filing with, or authorization,approval, consent, license, order, registration, qualification or decree of,any court or governmental authority or agency, domestic or foreign, (B) noauthorization, approval, vote or other consent of any stockholder or creditorof the Manager, (C) no waiver or consent under any Company Document, and (D) noauthorization, approval, vote or other consent of any other person or entity,is necessary or required for the performance by the Manager of its obligationsunder this Agreement or the Manager Agreements and the transactionscontemplated thereby, in each case on the

 

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### termscontemplated by the Prospectus, except such as have been already obtained.

### (7)                                  Possessionof Licenses and Permits. The Manager possesses such Governmental Licensesissued by the appropriate federal, state, local or foreign regulatory agenciesor bodies necessary to conduct its business as described in the Prospectus; theManager is in material compliance with the terms and conditions of all suchGovernmental Licenses, except where the failure so to comply would not,individually or in the aggregate, have a Material Adverse Effect; all of theGovernmental Licenses are valid and in full force and effect, except when theinvalidity of such Governmental Licenses or the failure of such GovernmentalLicenses to be in full force and effect would not have a Material AdverseEffect; and the Manager has not received any notice of proceedings relating tothe revocation or modification of any such Governmental Licenses which,individually or in the aggregate, if the subject of an unfavorable decision,ruling or finding, would result in a Material Adverse Effect.

### (8)                                  InvestmentAdvisers Act. The Manager is not prohibited by the Investment Advisers Actof 1940, as amended (the “**Advisers Act**”),or the rules and regulations thereunder, from performing under theManagement Agreement as contemplated by the Management Agreement and asdescribed in the Prospectus.

# 7. Covenants of theCompany. Each of the Company and the Operating Partnership, severally,covenants and agrees with CF&Co as follows:

## (a) RegistrationStatement Amendments. After the date of this Agreement and during anyperiod in which a Prospectus relating to any Placement Shares is required to bedelivered by CF&Co under the Securities Act (including in circumstanceswhere such requirement may be satisfied pursuant to Rule 172 under theSecurities Act), (i) the Company will notify CF&Co promptly of thetime when any subsequent amendment to the Registration Statement, other thandocuments incorporated by reference, has been filed with the Commission and/orhas become effective or any subsequent supplement to the Prospectus has beenfiled and of any request by the Commission for any amendment or supplement tothe Registration Statement or Prospectus or for additional information, (ii) theCompany will prepare and file with the Commission, promptly upon CF&Co’srequest, any amendments or supplements to the Registration Statement,Prospectus or free writing prospectus that, in the opinion of external counselfor CF&Co, is necessary in order that the Registration Statement orProspectus will not include any untrue statement of a material fact or omit tostate a material fact necessary in order to make the statements therein notmisleading (with respect to the Prospectus only, in the light of thecircumstances existing at the time it is delivered to a purchaser), or if itshall be necessary, in the opinion of such counsel, at any such time to amendthe Registration Statement or amend or supplement the Prospectus in order tocomply with the requirements of the Securities Act in connection with thedistribution of the Placement Shares by

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## CF&Co (*provided,however*, that the failure of CF&Co to make such request shallnot relieve the Company of any obligation or liability hereunder, or affectCF&Co’s right to rely on the representations and warranties made by theCompany in this Agreement); (iii) the Company will not file any amendmentor supplement to the Registration Statement or Prospectus or prepare any freewriting prospecuts relating to the Placement Shares unless a copy thereof hasbeen submitted to CF&Co within a reasonable period of time before thefiling and CF&Co has not reasonably objected thereto (*provided, however*, that the failure ofCF&Co to make such objection shall not relieve the Company of anyobligation or liability hereunder, or affect CF&Co’s right to rely on therepresentations and warranties made by the Company in this Agreement) and theCompany will furnish to CF&Co at the time of filing thereof a copy of anydocument that upon filing is deemed to be incorporated by reference into theRegistration Statement or Prospectus, except for those documents available viaEDGAR; and (iv) the Company will promptly effect the filing or cause eachamendment or supplement to the Prospectus to be filed with the Commission asrequired pursuant to the applicable paragraph of Rule 424(b) of theSecurities Act or, in the case of any document to be incorporated therein byreference, to be filed with the Commission as required pursuant to the ExchangeAct, within the time period prescribed (the determination to file or not fileany amendment or supplement with the Commission under this Section 7(a),based on the Company’s reasonable opinion or reasonable objections, shall bemade exclusively by the Company).

## (b) Noticeof Commission Stop Orders. The Company will advise CF&Co, promptlyafter it receives notice or obtains knowledge thereof, of the issuance by theCommission of any stop order suspending the effectiveness of the RegistrationStatement, of the suspension of the qualification of the Placement Shares foroffering or sale in any jurisdiction, or of the initiation or threatening ofany proceeding for any such purpose; and it will make every reasonable effortto prevent the issuance of any stop order or to obtain its withdrawal if such astop order should be issued.

## (c) Deliveryof Prospectus; Subsequent Changes. During any period in which a Prospectusrelating to the Placement Shares is required to be delivered by CF&Co underthe Securities Act with respect to the offer and sale of the Placement Shares,(including in circumstances where such requirement may be satisfied pursuant toRule 172 under the Securities Act), the Company will comply with allrequirements imposed upon it by the Securities Act, as from time to time inforce, and to file on or before their respective due dates all reports and anydefinitive proxy or information statements required to be filed by the Companywith the Commission under the Exchange Act. If during such period any eventoccurs as a result of which the Prospectus as then amended or supplementedwould include an untrue statement of a material fact or omit to state amaterial fact necessary to make the statements therein, in the light of thecircumstances then existing, not misleading, or if during such period it isnecessary to amend or supplement the Registration Statement or Prospectus tocomply with the Securities Act, the Company will promptly notify CF&Co tosuspend the offering of Placement Shares during such period and the Company willpromptly amend or supplement the Registration Statement or

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## Prospectus (at the expense of the Company) soas to correct such statement or omission or effect such compliance.

## (d) Listingof Placement Shares. During any period in which the Prospectus relating tothe Placement Shares is required to be delivered by CF&Co under theSecurities Act with respect to the offer and sale of the Placement Shares(including in circumstances where such requirement may be satisfied pursuant toRule 172 under the Securities Act), the Company will use its reasonablebest efforts to effect the listing on the Exchange and to qualify the PlacementShares for sale under the securities laws of such jurisdictions as CF&Coreasonably designates and to continue such qualifications in effect so long asrequired for the distribution of the Placement Shares; *provided, however,* that the Company shallnot be required in connection therewith to qualify as a foreign corporation ordealer in securities or file a general consent to service of process in anyjurisdiction.

## (e) Deliveryof Registration Statement and Prospectus. The Company will furnish toCF&Co and its counsel (at the expense of the Company) copies of theRegistration Statement, the Prospectus (including all documents incorporated byreference therein and any free writing prospectus) and all amendments andsupplements to the Registration Statement or Prospectus that are filed with theCommission during any period in which a Prospectus relating to the PlacementShares is required to be delivered under the Securities Act (including alldocuments filed with the Commission during such period that are deemed to beincorporated by reference therein), in each case as soon as reasonablypracticable and in such quantities as CF&Co may from time to timereasonably request and, at CF&Co’s request, will also furnish copies of theProspectus to each exchange or market on which sales of the Placement Sharesmay be made; *provided, however,*that the Company shall not be required to furnish any document (other than theProspectus) to CF&Co to the extent such document is available on EDGAR.

## (f) EarningsStatement. The Company will make generally available to its securityholders as soon as practicable, an earnings statement that satisfies theprovisions of Section 11(a) and Rule 158 of the Securities Act.

## (g) Expenses.The Company, whether or not the transactions contemplated hereunder areconsummated or this Agreement is terminated, in accordance with the provisionsof Section 11 hereunder, will pay the following all expenses incident tothe performance of its obligations hereunder, including, but not limited to,expenses relating to (i) the preparation, printing and filing of theRegistration Statement and each amendment and supplement thereto, of each Prospectusand of each amendment and supplement thereto, (ii) the preparation,issuance and delivery of the Placement Shares, (iii) the qualification ofthe Placement Shares under securities laws in accordance with the provisions ofSection 7(d) of this Agreement, including filing fees and anyreasonable fees or disbursements of counsel for CF&Co in connectiontherewith, not to exceed $5,000 (iv) the printing and delivery toCF&Co of copies of the Prospectus and any amendments or supplementsthereto, and of this Agreement, (v) the fees and expenses incurred in connectionwith the listing of the

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## Placement Shares for trading on the Exchange,(vi) filing fees and expenses, if any, of the NASD Corporate FinancingDepartment.

## (h) Useof Proceeds. The Company will use the Net Proceeds as described in theProspectus in the section entitled “Use of Proceeds.”

## (i) Restrictionon Sale of Securities. Each of the Company and the Operating Partnershipwill not, if there is a Placement Notice pending, without providing CF&Conotice as promptly as reasonably possible before taking any of the actionslisted below, offer, sell, agree to offer or sell, solicit offers to purchase,grant any call option or purchase any put option with respect to, pledge,borrow or otherwise dispose of, or establish or increase a “put equivalentposition” or liquidate or decrease a “call equivalent position” within themeaning of Section 16 of the Securities Act, or otherwise enter into anyswap, derivative or other transaction or arrangement that transfers to another,in whole or in part, any of the economic consequences of ownership, whether ornot such transaction is to be settled by delivery of such securities, othersecurities, cash or other consideration with respect to, the Company’s CommonStock, OP Units or other stock of the Company or any other equity securitiesconvertible into, or exercisable or exchangeable for, shares of the Company’sCommon Stock, or other stock, or publicly announce an intention to effect anysuch transaction, during the term of this Agreement provided, however no noticeis required (A) the Company issues and sells the Shares pursuant to thisAgreement, (B) the Company issues and sells Common Stock and options topurchase Common Stock pursuant to any employee or director stock option orstock purchase plans in effect on the date of this Agreement (so long as eachsuch plan and issuance is described in the Prospectus), (C) the OperatingPartnership issues OP Units in consideration for acquisitions of assets and (D) theCompany may issue Common Stock upon the conversion of its outstandingsecurities, upon exchange of OP Units, or upon exercise of warrants, options orother rights in effect or outstanding.

## (j) Changeof Circumstances. The Company will, at any time during a fiscal quarter inwhich the Company intends to tender a Placement Notice or sell Placement Sharesduring the term of this Agreement, as supplemented from time to time, adviseCF&Co promptly after it shall have received notice or obtained knowledgethereof, of any material events respectingits activities, affairs or condition, financial or otherwise, and the Companywill forthwith supply such information to CF&Co as shall be necessary inthe opinion of counsel to the Company for the Company to prepare any necessaryamendment or supplement to the Prospectus so that, as so amended orsupplemented, the Prospectus will not contain an untrue statement of a materialfact or omit to state a material fact necessary in order to make the statementstherein, in the light of the circumstances existing at the time it is deliveredto a purchaser, not misleading.

## (k) DueDiligence Cooperation. The Company will cooperate with any reasonable duediligence review conducted by CF&Co or its agents in connection with thetransactions contemplated hereby, including, without limitation, providing

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## information and making available documentsand senior corporate officers, during regular business hours and at the Company’sprincipal offices, as CF&Co may reasonably request.

## (l) RequiredFilings Relating to Placement of Placement Shares. The Company agrees thaton such dates as the Securities Act shall require, the Company will (i) filea prospectus supplement with the Commission under the applicable paragraph of Rule 424(b) underthe Securities Act (each and every filing under Rule 424(b), a “**Filing Date**”), which prospectussupplement will set forth, within the relevant period, the amount of PlacementShares sold through CF&Co, the Net Proceeds to the Company and thecompensation payable by the Company to CF&Co with respect to such PlacementShares, and (ii) deliver such number of copies of each such prospectussupplement to each exchange or market on which such sales were effected as maybe required by the rules or regulations of such exchange or market, and(iii) make any other filings required by the Securities Act required withthe placement of the Shares.

## (m) RepresentationDates; Certificate. During the term of this Agreement, on or prior to thedate that the first Shares are sold pursuant to the terms of this Agreement andeach time the Company (i) files the Prospectus relating to the PlacementShares or amends or supplements the Registration Statement or the Prospectusrelating to the Placement Shares (other than a prospectus supplement filed inaccordance with Section 7(l) of this Agreement) by means of apost-effective amendment, sticker, or supplement but not by means ofincorporation of document(s) by reference to the Registration Statement orthe Prospectus relating to the Placement Shares; (ii) files an annualreport on Form 10-K under the Exchange Act (**“Form 10-K”**); (iii) filesits quarterly reports on Form 10-Q under the Exchange Act (**“Form 10-Q”**); or (iv) filesa report on Form 8-K containing audited financial statements of theCompany (other than an earnings release, to “furnish” information pursuant toItems 2.02 or 7.01 of Form 8-K or to provide disclosure pursuant toItem 8.01 of Form 8-K relating to the reclassifications of certainproperties as discontinued operations in accordance with Statement of FinancialAccounting Standards No. 144) under the Exchange Act (each date of filingof one or more of the documents referred to in clauses (i) through (iv) shallbe a **“Representation Date”**);the Company shall furnish CF&Co with a certificate, in the form attachedhereto as Exhibit 7(m). The requirement to provide a certificateunder this Section 7(m) shall be waived for any RepresentationDate occurring at a time at which no Placement Notice is pending, which waivershall continue until the earlier to occur of the date the Company delivers aPlacement Notice hereunder (which for such calendar quarter shall be considereda Representation Date) and the next occurring Representation Date; *provided*, *however*,that such waiver shall not apply for any Representation Date on which theCompany files its annual report on Form 10-K. Notwithstanding theforegoing, if the Company subsequently decides to sell Placement Sharesfollowing a Representation Date when the Company relied on such waiver and didnot provide CF&Co with a certificate under this Section 7(m),then before the Company delivers the Placement Notice or CF&Co sells anyPlacement Shares, the Company shall provide CF&Co with a certificate, inthe form attached hereto as Exhibit 7(m), dated the date of thePlacement Notice.

 

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## (n) LegalOpinion. On or prior to the date that the first Shares are sold pursuant tothe terms of this Agreement, and within three (3) Trading Days of eachRepresentation Date with respect to which the Company is obligated to deliver acertificate in the form attached hereto as Exhibit 7(m) forwhich no waiver is applicable, the Company shall cause to be furnished toCF&Co written opinions of Clifford Chance US LLP (“Company Counsel”)and Wilkie Farr & Gallagher LLP (“**Special40 Act Counsel**”), or other counsel satisfactory to CF&Co, inform and substance satisfactory to CF&Co and its counsel, dated the date ofthis Agreement or the Representation Date, as the case may be, substantiallysimilar to the form attached hereto as Exhibit 7(n)(1)(a) and Exhibit 7(n)(1)(b),respectively, modified, as necessary, to relate to the Registration Statementand the Prospectus as then amended or supplemented; *provided*, *however*,that in lieu of such opinions for subsequent Representation Dates, counsel mayfurnish CF&Co with a letter (a “**RelianceLetter**”) to the effect that CF&Co may rely on a prioropinion delivered under this Section 7(n) to the same extentas if it were dated the date of such letter (except that statements in suchprior opinion shall be deemed to relate to the Registration Statement and theProspectus as amended or supplemented at such Representation Date).

## (o) ComfortLetter. On or prior to the date that the first Shares are sold pursuant tothe terms of this Agreement and thereafter within three (3) Trading Daysof each Representation Date occurring during any period in which the Prospectusrelating to the Placement Shares is required to be delivered by CF&Co(including in circumstances where such requirement may be satisfied pursuant toRule 172 under the Act) and each Representation Date with respect to whichthe Company is obligated to deliver a certificate in the form attached heretoas Exhibit 8(m) for which no waiver is applicable, the Companyshall cause its independent accountants to furnish CF&Co letters (the **“Comfort Letters”**), dated the dateof the Comfort Letter is delivered, in form and substance satisfactory toCF&Co, (i) confirming that they are an independent public accountingfirm  within the meaning of theSecurities Act and the PCAOB, (ii) stating, as of such date, theconclusions and findings of such firm with respect to the financial informationand other matters ordinarily covered by accountants’ “comfort letters” tounderwriters in connection with registered public offerings (the first suchletter, the **“Initial Comfort Letter”**)and (iii) updating the Initial Comfort Letter with any information thatwould have been included in the Initial Comfort Letter had it been given onsuch date and modified as necessary to relate to the Registration Statement andthe Prospectus, as amended and supplemented to the date of such letter.

## (p) NoPrice Stabilization or Manipulation. During the pendency of any PlacementNotice hereunder, the Company will not, and will use its best efforts to causeits officers, directors and affiliates not to, (i) take, directly orindirectly any action designed to stabilize or manipulate the price of anysecurity of the Company, or which may cause or result in, or which might in thefuture reasonably be expected to cause or result in, the stabilization ormanipulation of the price of any security of the Company, to facilitate thesale or resale of any of the Shares, (ii) sell, bid for, purchase or payanyone any compensation for soliciting purchases of the Shares 

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## other than           CF&Co, or (iii) pay or agree to pay to any person (other thanCF&Co) any compensation for soliciting any order to purchase any othersecurities of the            Company.

## (q) REITTreatment. The Company will use its commercially reasonable efforts tocontinue to meet the requirements for qualification and taxation as a REITunder the Code for subsequent tax years that include any portion of the term ofthis Agreement.

## (r) CompanyNot an “Investment Company.”  The Company is familiar with the InvestmentCompany Act of 1940, as amended, and the rules and regulations thereunder,and will in the future conduct its and the Operating Partnership’s affairs, insuch a manner and will use its commercially reasonable best efforts to ensurethat the Company and the Operating Partnership will not be an “investmentcompany” within the meaning of the Investment Company Act of 1940 and the rules andregulations thereunder.

## (s) CF&CoPurchases. The Company acknowledges and agrees that CF&Co has informedthe Company that CF&Co may, to the extent permitted under the Securities Act and the Exchange Act,purchase and sell shares of CommonStock for its own account while this Agreement is in effect, *provided,**that*(i) no such purchase or sales shall take place while a Placement Notice isin effect (except to the extent CF&Co may engage in sales of PlacementShares purchased or deemed purchased from the Company as a “riskless principal”or in a similar capacity) and (ii) the Company shall not be deemed to haveauthorized or consented to any such purchases or sales by CF&Co.

## (t) NoOffer to Sell. Other than a free writing prospectus (as defined in Rule 405under the Act) approved in advance by the Company and CF&Co in its capacityas principal or agent hereunder, neither CF&Co nor the Company (includingits agents and representatives, other than CF&Co in its capacity as such)will make, use, prepare, authorize, approve or refer to any writtencommunication (as defined in Rule 405 under the Act), required to be filedwith the Commission, that constitutes an offer to sell or solicitation of anoffer to buy Shares hereunder

# 8. Conditions toCF&Co’s Obligations. The obligations of CF&Co hereunder withrespect to a Placement will be subject to the completion by CF&Co of a duediligence review satisfactory to CF&Co in its reasonable judgment, and tothe continuing satisfaction (or waiver by CF&Co in its sole discretion) ofthe following additional conditions:

## (a) RegistrationStatement Effective. The Registration Statement shall have become effectiveand shall be available for the (i) resale of all Placement Shares issuedto CF&Co and not yet sold by CF&Co and (ii) the sale of allPlacement Shares contemplated to be issued by any Placement Notice.

## (b) NoMaterial Notices. None of the following events shall have occurred and becontinuing:  (i) receipt by theCompany of any request for additional

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## information from the Commission or any otherfederal or state governmental authority during the period of effectiveness ofthe Registration Statement, the response to which would require anypost-effective amendments or supplements to the Registration Statement or theProspectus; (ii) the issuance by the Commission or any other federal orstate governmental authority of any stop order suspending the effectiveness ofthe Registration Statement or the initiation of any proceedings for thatpurpose; (iii) receipt by the Company of any notification with respect tothe suspension of the qualification or exemption from qualification of any ofthe Placement Shares for sale in any jurisdiction or the initiation orthreatening of any proceeding for such purpose; (iv) the occurrence of anyevent that makes any material statement made in the Registration Statement orthe Prospectus or any material document incorporated or deemed to beincorporated therein by reference untrue in any material respect or thatrequires the making of any changes in the Registration Statement, relatedProspectus or documents so that, in the case of the Registration Statement, itwill not contain any materially untrue statement of a material fact or omit tostate any material fact required to be stated therein or necessary to make thestatements therein not misleading and, that in the case of the Prospectus, itwill not contain any materially untrue statement of a material fact or omit tostate any material fact required to be stated therein or necessary to make thestatements therein, in the light of the circumstances under which they weremade, not misleading.

## (c) Representationsand Warranties. All the representations and warranties of the Company,the Operating Partnership, and the Manager contained in this Agreement shall betrue and correct on each Representation Date, with the same force and effect asif made on and as of such Representation Date, and the Company, the OperatingPartnership, and the Manager shall have complied with all agreements and allconditions on its part to be performed or satisfied hereunder at or prior tosuch Representation Date.

## (d) LegalOpinion. CF&Co shall have received the opinions of Company Counselrequired to be delivered pursuant Section 7(n) on or beforethe date on which such delivery of such opinion is required pursuant to Section 7(n).

## (e) ComfortLetter. CF&Co shall have received the Comfort Letter required to bedelivered pursuant Section 7(o) on or before the date on whichsuch delivery of such opinion is required pursuant to Section 7(o).

## (f) RepresentationCertificate. CF&Co shall have received the certificate required to bedelivered pursuant to Section 7(m) on or before the date onwhich delivery of such certificate is required pursuant to Section 7(m).

## (g) NoSuspension. Trading in the Shares shall not have been suspended on theExchange.

## (h) OtherMaterials. On each date on which the Company is required to deliver acertificate pursuant to Section 8(m), the Company shall havefurnished to

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## CF&Co such appropriate furtherinformation, certificates and documents as CF&Co may reasonably request.All such opinions, certificates, letters and other documents will be incompliance with the provisions hereof. The Company will furnish CF&Co withsuch conformed copies of such opinions, certificates, letters and otherdocuments as CF&Co shall reasonably request.

## (i) No Objection. Prior to the date of this Agreement, NASD Regulation Inc. shall haveconfirmed in writing that it has no objection with respect to the fairness andreasonableness of the underwriting terms and arrangements.

## (j) NoTermination Event. There shall not haveoccurred any event that would permit CF&Co to terminate this Agreementpursuant to Section 11(a).

# 9. Indemnificationand Contribution.

## (a) Indemnification by the Company and the OperatingPartnership. Each of the Company and the Operating Partnership, jointly andseverally, agrees to indemnify and hold harmless CF&Co and each person, ifany, who controls CF&Co within the meaning of Section 15 of the 1933Act or Section 20 of the 1934 Act as follows:

(i) against any and all loss, liability, claim, damage and expense whatsoever, asincurred, arising in whole or in part out of any untrue statement or allegeduntrue statement of a material fact contained in the Registration Statement orthe Prospectus, or in any supplement thereto or amendment thereof, or arisingout of or are based upon the omission or alleged omission to state therein amaterial fact required to be stated therein or necessary to make the statementstherein not misleading;

(ii) against any and all loss, liability, claim, damage and expense whatsoever, asincurred, to the extent of the aggregate amount paid in settlement of anylitigation, or any investigation or proceeding by any governmental agency orbody, commenced or threatened, or of any claim whatsoever based upon any of (i) above;provided that (subject to Section 9(d) below) any such settlement iseffected with the written consent of the Company; and

(iii) against any and all expense whatsoever, as incurred (including the fees anddisbursements of counsel chosen by the Company), reasonably incurred in investigating,preparing or defending against any litigation, or any investigation orproceeding by any governmental agency or body, commenced or threatened, or anyclaim whatsoever based upon any of (i) above, to the extent that any suchexpense is not paid under (i) or (ii) above,

provided,however, that this indemnity agreement shall not apply to any loss, liability,claim, damage or expense to the extent arising out of any untrue statement oromission or alleged untrue statement or omission made in reliance upon and inconformity with written information furnished to the Company by CF&Coexpressly for use in the Registration Statement (or any amendment thereto), orin any preliminary prospectus or the Prospectus (or any amendment or supplementthereto).

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Theindemnity agreement set forth in this Section 10(a) shall bein addition to any liabilities that the Company may otherwise have.

## (b) Indemnification by CF&Co. CF&Co agrees toindemnify and hold harmless the Company, its directors, each of its officers whosigned the Registration Statement and the Operating Partnership and eachperson, if any, who controls the Company and the Operating Partnership withinthe meaning of Section 15 of the Securities Act or Section 20 of theExchange Act against any and all loss, liability, claim, damage and expensedescribed in the indemnity contained in subsection (a) of this Section 10,as incurred, but only with respect to untrue statements or omissions, oralleged untrue statements or omissions, made in the Registration Statement (orany amendment thereto), or the Prospectus (or any amendment or supplementthereto) in reliance upon and in conformity with written information furnishedto the Company by CF&Co expressly for use in the Registration Statement (orany amendment thereto), which information is described in Section 7(a)(2)hereof or the Prospectus (or any amendment or supplement thereto). Theindemnity agreement set forth in this Section 9(b) shall be inaddition to any liabilities that CF&Co may otherwise have.

## (c) Actions against Parties; Notification. Promptly after receipt by an indemnified partyunder subsection (a) or (b) above of notice of the commencement ofany action, such indemnified party shall, if a claim in respect thereof is tobe made against an indemnifying party under such subsection, notify theindemnifying party in writing of the commencement thereof; but the omission soto notify such indemnifying party shall not relieve the indemnifying party fromany liability which it may have to any indemnified party under such subsectionexcept to the extent it has been materially prejudiced by such failure. In caseany such action shall be brought against any indemnified party and it shallnotify the indemnifying party of the commencement thereof, the indemnifyingparty shall be entitled to participate therein and, to the extent that it shallwish, jointly with any other indemnifying party similarly notified, to assumethe defense thereof, with counsel reasonably satisfactory to such indemnifiedparty (who shall not, except with the consent of the indemnified party, becounsel to the indemnifying party), and, after notice from the indemnifyingparty to such indemnified party of its election so to assume the defensethereof, the indemnifying party shall not be liable to such indemnified partyunder such subsection for any legal or other expenses, in each casesubsequently incurred by such indemnified party, in connection with the defensethereof other than reasonable costs of investigation. No indemnifying partyshall, without the written consent of the indemnified party, effect thesettlement or compromise of, or consent to the entry of any judgment withrespect to, any pending or threatened

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## action or claim in respect of which indemnification or contribution maybe sought hereunder (whether or not the indemnified party is an actual orpotential party to such action or claim) unless such settlement, compromise orjudgment (i) includes an unconditional release of the indemnified partyfrom all liability arising out of such action or claim and (ii) does notinclude any statement as to, or an admission of, fault, culpability or afailure to act, by or on behalf of any indemnified party.

## (d) Settlement Without Consent if Failure toReimburse. If at any time anindemnified party shall have requested an indemnifying party to reimburse theindemnified party for fees and expenses of counsel, such indemnifying partyagrees that it shall be liable for any settlement of the nature contemplated bySection 9(a)(ii) effected without its written consent if (i) suchsettlement is entered into more than 45 days after delivery to suchindemnifying party of the aforesaid request, (ii) such indemnifying partyshall have received notice of the terms of such settlement at least 30 days priorto such settlement being entered into and (iii) such indemnifying partyshall not have reimbursed such indemnified party in accordance with suchrequest prior to the date of such settlement.

## (e) Contribution. If the indemnification provided for inthis Section 9 is for any reason unavailable to or insufficient tohold harmless an indemnified party in respect of any losses, liabilities,claims, damages or expenses referred to therein, then each indemnifying partyshall contribute to the aggregate amount of such losses, liabilities, claims,damages and expenses incurred by such indemnified party, as incurred, (i) insuch proportion as is appropriate to reflect the relative benefits received bythe Company and the Operating Partnership on the one hand and CF&Co on theother hand from the offering of the Shares pursuant to this Agreement or (ii) ifthe allocation provided by clause (i) is not permitted by applicable law,in such proportion as is appropriate to reflect not only the relative benefitsreferred to in clause (i) above but also the relative fault of the Companyand the Operating Partnership on the one hand and of CF&Co on the otherhand in connection with the inaccuracies, statements or omissions whichresulted in such losses, liabilities, claims, damages or expenses, as well asany other relevant equitable considerations. The relative benefits received bythe Company and the Operating Partnership on the one hand and CF&Co on theother hand in connection with the offering of the Shares pursuant to thisAgreement shall be deemed to be in the same respective proportions as the totalnet proceeds from the offering of the Shares pursuant to this Agreement (beforededucting expenses) received by the Company and the Operating Partnership andthe total underwriting discount received by CF&Co, in each case as setforth on the cover of the Prospectus, bear to the aggregate public offeringprice of the Shares as set forth on such cover. The relative fault of theCompany and the Operating Partnership on the one hand and CF&Co on theother hand shall be determined by reference to, among other things, whether anysuch untrue or alleged untrue statement of a material fact or omission oralleged omission to state a material fact relates to information supplied bythe Company, the Operating Partnership, or by CF&Co and the parties’relative intent, knowledge, access to information and opportunity to correct orprevent such statement or omission. The Company, the Operating Partnership andCF&Co agree that it would not be just and equitable if contributionpursuant to this Section 9(e) were determined by pro rataallocation or by any other method of allocation

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## which does nottake account of the equitable considerations referred to above in this Section 9(e).The aggregate amount of losses, liabilities, claims, damages and expensesincurred by an indemnified party and referred to above in this Section 9(e) shallbe deemed to include any legal or other expenses reasonably incurred by suchindemnified party in investigating, preparing or defending against anylitigation, or any investigation or proceeding by any governmental agency orbody, commenced or threatened, or any claim whatsoever based upon any suchuntrue or alleged untrue statement or omission or alleged omission. Notwithstandingthe provisions of this Section 9(e), CF&Co shall not berequired to contribute any amount in excess of the amount by which the totalprice at which the Shares underwritten by it and distributed to the public wereoffered to the public exceeds the amount of any damages which CF&Co hasotherwise been required to pay by reason of any such untrue or alleged untruestatement or omission or alleged omission.

## No person guilty of fraudulent misrepresentation (within the meaning ofSection 11(f) of the Securities Act) shall be entitled tocontribution from any person who was not guilty of such fraudulentmisrepresentation.

## For purposes of this Section 9(e), each person, if any, whocontrols CF&Co within the meaning of Section 15 of the Securities Act orSection 20 of the Exchange Act shall have the same rights to contributionas CF&Co, and each director of the Company, each officer of the Company whosigned the Registration Statement, the Operating Partnership, and each person,if any, who controls the Company and the Operating Partnership within themeaning of Section 15 of the Securities Act or Section 20 of theExchange Act shall have the same rights to contribution as the Company and theOperating Partnership.

# 10. Representationsand Agreements to Survive Delivery. The indemnity and contributionagreements contained in Section 9 of this Agreement and allrepresentations and warranties of the Company herein or in certificatesdelivered pursuant hereto shall survive, as of their respective dates, regardlessof (i) any investigation made by or on behalf of CF&Co, anycontrolling persons, or the Company (or any of their respective officers,directors or controlling persons), (ii) delivery and acceptance of thePlacement Shares and payment therefor or (iii) any termination of thisAgreement.

# 11. Termination.

## (a) CF&Coshall have the right by giving notice as hereinafter specified at any time toterminate this Agreement if (i) any Material Adverse Effect, or anydevelopment that has actually occurred and that is reasonably expected to causea Material Adverse Effect has occurred that, in the reasonable judgment ofCF&Co, may materially impair the ability of CF&Co to sell the PlacementShares hereunder, (ii) the Company shall have failed, refused or beenunable at or prior to any Settlement Date to perform any agreement on its partto be performed hereunder; *provided,however,* in the case of any failure of the Company to deliver (orcause another person to deliver) any certification, opinion, or letter requiredunder

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## Sections7(m),7(n), or 7(o), CF&Co’s right to terminate shall not ariseunless such failure to deliver (or cause to be delivered) continues for morethan thirty (30) days from the date such delivery was required; or (iii) anyother condition of CF&Co’s obligations hereunder is not fulfilled, or (iv),any suspension or material limitation of trading in the Placement Shares or insecurities generally on the Exchange shall have occurred. Any such terminationshall be without liability of any party to any other party except that theprovisions of Section 7(g) (Expenses), Section 9(Indemnification), Section 10 (Survival of Representations), Section 15(Applicable Law; Consent to Jurisdiction) and Section 16 (Waiver ofJury Trial) hereof shall remain in full force and effect notwithstanding suchtermination. If CF&Co elects to terminate this Agreement as provided inthis Section 11(a), CF&Co shall provide the required notice asspecified in Section 11 (Notices).

## (b) TheCompany shall have the right, by giving ten (10) days notice ashereinafter specified to terminate this Agreement in its sole discretion at anytime after the date of this Agreement. Any such termination shall be withoutliability of any party to any other party except that the provisions of Section 7(g),Section 9, Section 10, Section 15 and Section 16hereof shall remain in full force and effect notwithstanding such termination.

## (c) CF&Coshall have the right, by giving ten (10) days notice as hereinafterspecified to terminate this Agreement in its sole discretion at any time afterthe date of this Agreement. Any such termination shall be without liability ofany party to any other party except that the provisions of Section 7(g),Section 9, Section 10, Section 15 and Section 16hereof shall remain in full force and effect notwithstanding such termination.

## (d) Unlessearlier terminated pursuant to this Section 11, this Agreement shallautomatically terminate upon the issuance and sale of all of the PlacementShares through CF&Co on the terms and subject to the conditions set forthherein; *provided* thatthe provisions of Section 7(g), Section 10, Section 10, Section 16and Section 17 hereof shall remain in full force and effectnotwithstanding such termination.

## (e) ThisAgreement shall remain in full force and effect unless terminated pursuant to Sections10(a), (b), (c), or (d) above or otherwise by mutualagreement of the parties; *provided, however,*that any such termination by mutual agreement shall in all cases bedeemed to provide that Section 7(g), Section 9, Section 10,Section 15 and Section 16 shall remain in full forceand effect.

## (f) Anytermination of this Agreement shall be effective on the date specified in suchnotice of termination; *provided, however,*that such termination shall not be effective until the close of business on thedate of receipt of such notice by CF&Co or the Company, as the case may be.If such termination shall occur prior to the Settlement Date for any sale ofPlacement Shares, such Placement Shares shall settle in accordance with theprovisions of this Agreement.

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## (g) Notices.All notices or other communications requiredor permitted to be given by any party to any other party pursuant to the termsof this Agreement shall be in writing, unless otherwise specified, andif sent to CF&Co, shall be delivered to CF&Co at Cantor Fitzgerald &Co., 110 East 59th Street, New York, New York 10022, fax no. (212) 829-4972,Attention: ITD-Investment Banking, with copies to Stephen Merkel, GeneralCounsel, at the same address, and DLA Piper Rudnick Gray Cary US LLP, 1251Avenue of the Americas, New York, NY 10020, fax no. (212) 884-8494,Attention: Dean M. Colucci; or if sent to the Company, shall be delivered toGramercy Capital Corp., Marc Holliday, President and Chief Executive Officer,420 Lexington Avenue, New York, New York 10170, (212) 297-1000, with acopy to  Clifford Chance US LLP, 31 West52nd Street, New York, New York 10019, (212) 878-8000,  attention: LarryP. Medvinsky, Esq., Esq. Each party to this Agreement maychange such address for notices by sending to the parties to this Agreementwritten notice of a new address for such purpose. Each such notice or other communication shall be deemed given (i) whendelivered personally or by verifiable facsimile transmission (with an originalto follow) on or before 4:30 p.m., New York City time, on a Business Dayor, if such day is not a Business Day, on the next succeeding Business Day, (ii) onthe next Business Day after timely delivery to a nationally-recognizedovernight courier and (iii) on the Business****Day actually received if deposited in the U.S. mail(certified or registered mail, return receipt requested, postage prepaid). Forpurposes of this Agreement, “**Business Day**”shall mean any day on which the Exchange and commercial banks in the City ofNew York are open for business.

# 12. Successors andAssigns. This Agreement shall inure to the benefit of and be binding uponthe Company and CF&Co and their respective successors and the affiliates,controlling persons, officers and directors referred to in Section 9hereof. References to any of the parties contained in this Agreement shall bedeemed to include the successors and permitted assigns of such party. Nothing in this Agreement, express or implied, isintended to confer upon any party other than the parties hereto or theirrespective successors and permitted assigns any rights, remedies, obligationsor liabilities under or by reason of this Agreement, except as expresslyprovided in this Agreement. Neither party may assign its rights or obligationsunder this Agreement without the prior written consent of the other party.

# 13.  Adjustments for Stock Splits. The partiesacknowledge and agree that all share-related numbers contained in thisAgreement shall be adjusted to take into account any stock split, stockdividend or similar event effected with respect to the Shares.

# 14. Entire Agreement;Amendment; Severability. This Agreement (including all schedules andexhibits attached hereto and Placement Notices issued pursuant hereto)constitutes the entire agreement and supersedes all other prior andcontemporaneous agreements and undertakings, both written and oral, among theparties hereto with regard to the subject matter hereof. Neither this Agreement nor any term hereof may be amended exceptpursuant to a written instrument executed by the Company and CF&Co. In theevent that any one or more of the provisions contained herein, or theapplication thereof in any circumstance, is held invalid, illegal orunenforceable as written by a court of competent jurisdiction, then such provision shall be given fullforce and effect to the fullest possible extent that it is valid, legal and enforceable, and the

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# remainder of the terms and provisions herein shall beconstrued as if such invalid, illegal orunenforceable term or provision was not contained herein, but only tothe extent that giving effect to such provision and the remainder of the termsand provisions hereof shall be in accordance with the intent of the parties asreflected in this Agreement.

# 15. Applicable Law;Consent to Jurisdiction. This Agreement shall be governed by, and construedin accordance with, the internal laws of the State of New York without regardto the principles of conflicts of laws. Eachparty hereby irrevocably submits to the non-exclusive jurisdiction of the stateand federal courts sitting in the City of New York, borough of Manhattan, forthe adjudication of any dispute hereunder or in connection with any transactioncontemplated hereby, and hereby irrevocably waives, and agrees not to assert inany suit, action or proceeding, any claim that it is not personally subject tothe jurisdiction of any such court, that such suit, action or proceeding isbrought in an inconvenient forum or that the venue of such suit, action orproceeding is improper. Each party hereby irrevocably waives personal serviceof process and consents to process being served in any such suit, action orproceeding by mailing a copy thereof (certified or registered mail, returnreceipt requested) to such party at the address in effect for notices to itunder this Agreement and agrees that such service shall constitute good andsufficient service of process and notice thereof. Nothing contained hereinshall be deemed to limit in any way any right to serve process in any mannerpermitted by law.

# 16. Waiver of JuryTrial. The Company and CF&Co each hereby irrevocably waives any rightit may have to a trial by jury in respect of any claim based upon or arisingout of this agreement or any transaction contemplated hereby.

# 17. Absence of Fiduciary Relationship*.*

The Company, the Operating Partnership and the Manageracknowledge and agree that:

## (a)                 the CF&Co has been retainedsolely to act as CF&Co in connection with the sale of the Shares and thatno fiduciary, advisory or agency relationship between the Company, theOperating Partnership or the Manager and the CF&Co has been created inrespect of any of the transactions contemplated by this Agreement, irrespectiveof whether the CF&Co has advised or is advising the Company, the Operating Partnershipor the Manager on other matters;

## (b)                theprice of the Shares set forth in this Agreement was established by the Companyand the CF&Co following discussions and arms-length negotiations with theCF&Co and the Company, and the Company, the Operating Partnership and theManager are capable of evaluating and understanding and understand and acceptthe terms, risks and conditions of the transactions contemplated by thisAgreement;

## (c)                 theyhave been advised that the CF&Co and its affiliates are engaged in a broadrange of transactions which may involve interests that differ from those of theCompany, the Operating Partnership or the Manager and that the CF&Co haveno obligation to disclose such interests and transactions to the Company, theOperating Partnership or the Manager by virtue of any fiduciary, advisory oragency relationship; and

## (d)                theywaive, to the fullest extent permitted by law, any claims they may have againstthe CF&Co, for breach of fiduciary duty or alleged breach of fiduciary dutyand agree that the CF&Co shall have no liability (whether direct orindirect) to the Company, the Operating Partnership or the Manager in respectof such a fiduciary claim or to any person asserting a fiduciary duty claim onbehalf of or in right of the Company, including stockholders, employees orcreditors of the Company, the Operating Partnership or the Manager.

# 18. Counterparts. ThisAgreement may be executed in two or more counterparts, each of which shall bedeemed an original, but all of which together shall constitute one and the sameinstrument. Delivery of an executed Agreement by one party to the other may bemade by facsimile transmission.

# 19. Definitions. Asused in this Agreement, the following terms have the respective meanings setforth below:

## (a) “Applicable Time” means the time of eachsale of any Shares or any securities pursuant to this Agreement.

## (b) “CompanyDocuments” means any contracts, indentures, mortgages, deeds of trust, loanor credit agreements, bonds, notes, debentures, evidences of indebtedness,leases or other instruments or agreements to which the Company, the OperatingPartnership, the Manager or any of their respective subsidiaries is a party orby which the Company, the Operating Partnership, the Manager or any of theirrespective subsidiaries is bound or to which any of the property or assets ofthe Company, the Operating Partnership, the Manager or any of their respectivesubsidiaries is subject.

## (c) “GAAP”means United States generally accepted accounting principles.

## (d) “OrganizationalDocuments” means (a) in the case of a corporation, its charter andby-laws; (b) in the case of a limited or general partnership, itspartnership certificate, certificate of formation or similar organizationaldocument

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## and its partnership agreement; (c) inthe case of a limited liability company, its articles of organization,certificate of formation or similar organizational documents and its operatingagreement, limited liability company agreement, membership agreement or othersimilar agreement; (d) in the case of a trust, its certificate of trust,certificate of formation or similar organizational document and its trustagreement or other similar agreement; and (e) in the case of any otherentity, the organizational and governing documents of such entity.

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If the foregoing correctly sets forth theunderstanding between the Company and CF&Co, please so indicate in thespace provided below for that purpose, whereupon this letter shall constitute abinding agreement between the Company and CF&Co. 
|        | Very truly yours,                    |                                         |
|--------|--------------------------------------|----------------------------------------------|
|   |                                 |                                         |
|   | GRAMERCY CAPITAL CORP.               |
|   |                                 |                                         |
|   | By:                                  |                                         |
|   | Name:                                |                                         |
|   | Title:                               |                                         |
|   |                                 |                                         |
|   |                                 |                                         |
|   | GKK CAPITAL LP                       |
|   |                                 |                                         |
|   | By:                                  | Gramercy Capital Corp., its  General Partner |
|   |                                 |                                         |
|   | By:                                  |                                         |
|   | Name:                                |                                         |
|   | Title:                               |                                         |
|   |                                 |                                         |
|   |                                 |                                         |
|   | GKK MANAGER LLC                      |
|   |                                 |                                         |
|   | By:                                  |                                         |
|   | Name:                                |                                         |
|   | Title:                               |                                         |
|   |                                 |                                         |
|   |                                 |                                         |
|   | **ACCEPTED as of the date**          |
|   | **First-above written:**             |
|   |                                 |
|   | **CANTOR FITZGERALD & CO.** |
|   |                                 |                                         |
|   | By:                                  |                                         |
|   |                                 | Jeffrey Lumby                                |
|   |                                 | Managing Director                            |
|        |                                      |                                              |  |  |  |

 

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**SCHEDULE 1**

**FORM OFPLACEMENT NOTICE**

From:                                                                  [                               ]

Cc:                                                                               [                               ]

To:                                                                            [                               ]

Subject:                  Controlled Equity Offering—Placement Notice

Gentlemen:

Pursuantto the terms and subject to the conditions contained in the Controlled EquityOfferingSM** **Sales Agreement between Gramercy Capital Corp.. (the “Company”),and Cantor Fitzgerald & Co. (“CF&Co”) dated May 10,2006 (the “Agreement”), I hereby request on behalf of the Company thatCF&Co sell up to ____________ shares of the Company’s common stock, parvalue $0.001 per share, at a minimum market price of $_______ per share.

[ADDITIONAL SALES PARAMETERSMAY BE ADDED, SUCH AS THE TIME PERIOD IN WHICH SALES ARE REQUESTED TO BEMADE, SPECIFIC DATES THE SHARES MAY NOT BE SOLD ON, THE MANNER IN WHICHSALES ARE TO BE MADE BY CF&CO, AND/OR THE CAPACITY IN WHICH CF&CO MAY ACTIN SELLING SHARES (AS PRINCIPAL, AGENT, OR BOTH)]

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**SCHEDULE 2**

**Compensation**

CF&Co shall be paidcompensation equal to two and one-half percent (2.5%) of the gross proceedsfrom the sales of the Shares pursuant to the terms of this Agreement.

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**SCHEDULE 3**

**CANTOR FITZGERALD & CO.**

PhilMarber

MarcJ. Blazer

JeffLumby

Patrice McNicoll

**GRAMERCY CAPITAL CORP.**

Robert Foley

Gregory Hughes

Marc Holliday

 

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**EXHIBIT A**

**SUBSIDIARIES OF THE COMPANY**
| **Name**                             | ** ** | **Jurisdiction of  Organization** | ** ** | **Type Of Entity**                  |
|--------------------------------------|------------|-----------------------------------|------------|-------------------------------------|
| GKK Trading Corp.                    |       | Delaware                          |       | Corporation                         |
| Gramercy 110 LLC                     |       | Delaware                          |       | Limited Liability  Company          |
| Gramercy Warehouse  Funding I LLC    |       | Delaware                          |       | Limited Liability  Company          |
| Gramercy Warehouse  Funding II LLC   |       | Delaware                          |       | Limited Liability  Company          |
| Gramercy Capital Trust  I            |       | Delaware                          |       | Statutory Trust                     |
| Gramercy Capital Trust  II           |       | Delaware                          |       | Statutory Trust                     |
| Gramercy Capital Trust  III          |       | Delaware                          |       | Statutory Trust                     |
| Gramercy Real Estate  CDO 2005-1 Ltd |       | Cayman Islands                    |       | Exempted Limited  Liability Company |
| Gramercy Real Estate  CDO 2005-1 LLC |       | Delaware                          |       | Limited Liability  Company          |
| GKK Madison Investment  LLC          |       | Delaware                          |       | Limited Liability  Company          |
| Gramercy Investment QRS  Corp.       |       | Delaware                          |       | Corporation                         |
| Gramercy Investment  Trading Corp.   |       | Delaware                          |       | Corporation                         |
| Gramercy Investment  Trust           |       | Maryland                          |       | Trust                               |
| GKK Trading Warehouse I  LLC         |       | Delaware                          |       | Limited Liability  Company          |
| GKK Trading Warehouse  II LLC        |       | Delaware                          |       | Limited Liability  Company          |
| Gramercy Rockaway 80 PE  LLC         |       | Delaware                          |       | Limited Liability  Company          |
| GKK Liquidity LLC                    |       | Delaware                          |       | Limited Liability  Company          |
| GKK 55 Corporate LLC                 |       | Delaware                          |       | Limited Liability  Company          |
| GKK 84 William Street  LLC           |       | Delaware                          |       | Limited Liability  Company          |
| GKK Pasadena Investment  LLC         |       | Delaware                          |       | Limited Liability  Company          |
| GKK Pasadena Owner LLC               |       | Delaware                          |       | Limited Liability  Company          |
| GKK Pasadena Tenant LLC              |       | Delaware                          |       | Limited Liability  Company          |
| Gramercy 200 Franklin  LLC           |       | Delaware                          |       | Limited Liability  Company          |
|                                 |       |                              |       |                                |

 

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| **SIGNIFICANT SUBSIDIARIES** |   |     |   |                                                             |
|------------------------------|--------|----------|--------|------------------------------------------------------------------|
| GKK Capital LP               |   | Delaware |   | Limited Partnership  (general partner is Gramercy Capital Corp.) |
| GKK Trading  Corp.           |   | Delaware |   | Corporation                                                      |

 

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**EXHIBIT B**

**JOINT VENTURES OF THE COMPANY**

 
| **Name**                          | ** ** | **Jurisdiction of  Organization** | ** ** | **Type Of Entity**         | ** ** | **Percentage Ownership** |
|-----------------------------------|------------|-----------------------------------|------------|----------------------------|------------|--------------------------|
| 1 Madison Office  Fee LLC         |       | Delaware                          |       | Limited Liability  Company |       | 45%                      |
| 200 Franklin  Trust               |       | Delaware                          |       | Statutory Trust            |       | 70.3%                    |
| GKK Pasadena Fee  Holdings LLC    |       | Delaware                          |       | Limited Liability  Company |       | 50%                      |
| GKK Pasadena  Tenant Holdings LLC |       | Delaware                          |       | Limited Liability  Company |       | 63.57%                   |

 

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**Exhibit 7(n)**

**Matters to be covered by initial OPINION OF**

**FORM OF OPINION OF CLIFFORD CHANCE US LLP**

1.             TheCompany has been duly incorporated and is validly existing as a corporation ingood standing under the laws of the State of Maryland.  The Company has the corporate power andauthority to conduct its business and own its properties as described in theProspectus and to enter into and perform its obligations under thisAgreement.  The Operating Partnership hasbeen duly organized and is validly existing as a limited partnership in goodstanding under the laws of the State of Delaware.  The Operating Partnership has the partnershippower and authority to own its properties as described in the Prospectus and toenter into and perform its obligations under this Agreement.  The Manager has been duly formed and isvalidly existing in good standing under the laws of the State of Delaware, andthe Manager has the power and authority to own its properties and to conductits business as described in the Prospectus and to enter into and perform itsobligations under this Agreement.

2.             Asof [                  ],the authorized, issued and outstanding stock of the Company is as set forth inthe most recent Form 10-K or Form 10-Q and such shares of the Company’s issuedand outstanding stock (the “Outstanding Shares”) have been duly authorized andvalidly issued and are fully paid and nonassessable and none of the OutstandingShares was issued in violation of preemptive rights arising under the laws ofthe State of Maryland or the Organizational Documents of the Company.  All of the issued and outstanding OP Unitshave been issued in accordance with the requirements of the PartnershipAgreement; none of the OP Units has been issued or is owned or held inviolation of any preemptive right arising by operation of law or under thisAgreement; to such counsel’s knowledge, the outstanding OP Units have beenoffered, sold and issued by the Operating Partnership in compliance with allfederal and state securities laws.

3.             Theexecution, delivery and performance by the Company of this Agreement, includingthe Company’s issuance of the Shares and sale of such Shares to theUnderwriter, has been duly authorized by all necessary corporate action on thepart of the Company.  The execution,delivery and performance by the Operating Partnership of this Agreement hasbeen duly authorized by all necessary partnership action on the part of theOperating Partnership.  The execution,delivery and performance by the Manager of this Agreement has been dulyauthorized by all necessary limited liability company action on the part of theManager.  This Agreement has been dulyexecuted and delivered by each of the Company, the Operating Partnership andthe Manager.

4.             TheShares have been duly authorized and, when issued and delivered by the Companypursuant to this Agreement, the Shares will be validly issued, fully paid andnonassessable.

5.             Theissuance of the Shares is not subject to preemptive rights arising under theGeneral Corporation Law of the State of Maryland or the OrganizationalDocuments of the Company.

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6.             Theexecution, delivery and performance of this Agreement by the Company, theOperating Partnership and the Manager and the consummation of the transactionscontemplated herein will not (i) result in any violation of the provisions ofthe Organizational Documents of the Company, the Operating Partnership or theManager, (ii) constitute a violation of or a breach or default under the termsof any Company Documents or (iii) violate or conflict with, or result in anycontravention of, any law, administrative regulation or administrative or courtdecree applicable to the Company, the Operating Partnership or the Manager orany of their subsidiaries except in the case of (ii) and (iii), such violationsas would not have a Material Adverse Effect.

7.             Theform of certificate representing the Common Stock complies (i) with theapplicable statutory requirements of the laws of the State of Maryland, (ii)the requirements of the Organizational Documents of the Company and (iii) therequirements of the NYSE.

8.             Wehave reviewed the information (i) in the Prospectus under the captions “RiskFactors — Risks Related to Our Organization and Structure,” “Risk Factors —Risks Related to Our Taxation As a REIT,” “Description of Common Stock,”“Description of Preferred Stock,” “Description of Depositary Shares,”“Description of Warrants,” “Description of “Certain Provisions of Maryland Lawand of Our Charter and Bylaws,” “The Operating Partnership Agreement” and“Material U.S. Federal Income Tax Considerations,” and (ii) in Part II of theRegistration Statement in Item 15 and, in each case, to the extent that suchinformation constitutes matters of law, summaries of legal matters ordocuments, summaries of certain provisions of the Organizational Documents ofthe Company, the Operating Partnership or the Manager or legal conclusions,such information is correct in all material respects.  The authorized stock of the Company conformsin all material respects to the description thereof in the Prospectus under thecaptions “Description of Common Stock” and “Description of Preferred Stock.”

9.             Eachof the Company, the Operating Partnership and their subsidiaries are dulyqualified as a foreign corporation, limited partnership or limited liabilitycompany, as the case may be, to transact business and is in good standing ineach jurisdiction in which such qualification is required, whether by reason ofthe ownership or leasing of property or the conduct of business, except forsuch jurisdictions where the failure to so qualify or to be in good standingwould not, individually or in the aggregate, result in a Material AdverseChange.

10.           Tothe knowledge of such counsel, none of the Company, the Operating Partnership,the Manager nor any subsidiary is in default under any of its OrganizationalDocuments.

11.           Otherthan SL Green as described in the Prospectus, to the knowledge of such counsel,no shareholder of the Company or unitholder of the Operating Partnership or anyother person has any preemptive right, right of first refusal or other similarright to subscribe for or purchase securities of the Company, the OperatingPartnership or any subsidiary.

12.           Tothe knowledge of such counsel, there are no legal or governmental proceedingspending or threatened to which the Company, the Operating Partnership, theManager or any of their subsidiaries is a party or to which any property of theCompany or any of its subsidiaries is subject that are required to be disclosedin the Prospectus that are not so disclosed.

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13.           Noconsent, approval, authorization or other order of, or registration or filingwith, any United States federal, Maryland, Delaware or New York state court orother governmental or regulatory authority or agency, is required for theCompany’s, the Operating Partnership’s or the Manager’s execution, delivery andperformance of this Agreement and consummation of the transactions contemplatedthereby and by the Prospectus, except such as have already been obtained underthe Securities Act and applicable state securities or blue sky laws and fromthe NASD.

14.           Commencingwith its taxable year ended December 31, 2004, the Company has been organizedand operated in conformity with the requirements for qualification and taxationas a REIT under the Code, and the Company’s current and proposed method ofoperation, as described in the Prospectus and as set forth in a certificate ofrepresentations from the Company, will enable it to continue to meet therequirements for qualification and taxation as a REIT under the Code.

15.           TheRegistration Statement has been declared effective by the Commission under theSecurities Act.  To the knowledge of suchcounsel, no stop order suspending the effectiveness of the Registration Statementhas been issued under the 1933 Act and no proceedings for such purpose havebeen instituted or are pending or are contemplated or threatened by theCommission.  Any required filing of theProspectus and any supplement thereto pursuant to Rule 424(b) under the 1933Act has been made in the manner and within the time period required by suchRule 424(b).

In addition, such opinion shall also contain astatement that such counsel has participated in conferences with officers andother representatives of the Company, representatives of the independentaccountants at which the contents of the Registration Statement and theProspectus and related matters were discussed, and although it does not passupon, or assume any responsibility for, the accuracy, completeness or fairnessof the statements contained in the Registration Statement or the Prospectus andhave made no independent check or verification thereof (except to the extentreferred to in paragraph eight of its opinion to the CF&Co dated the datehereof), on the basis of the foregoing, (i) the Registration Statement(including the Incorporated Documents), at each deemed effective date withrespect to CF&Co pursuant to Rule 430B(f)(2), and the Prospectus, as of itsdate and as of the date hereof, complied and complies as to form in allmaterial respects with the requirements of the 1933 Act and the 1933 ActRegulations (except that in each case such counsel may state that it does notexpress any view as to the financial statements, schedules and other financialor statistical information derived from such financial statements and schedulesincluded or incorporated by reference therein) and (ii) no facts have come tosuch counsel’s attention that have caused it to believe that the RegistrationStatement, at each deemed effective date with respect to CF&Co pursuant toRule 430B(f)(2), contained an untrue statement of a material fact or omitted tostate any material fact required to be stated therein or necessary to make thestatements therein not misleading or that the Prospectus, as of its date and asof the date hereof, contained or contains an untrue statement of a materialfact or omitted or omits to state a material fact necessary in order to makethe statements therein, in light of the circumstances under which they weremade, not misleading (except that in each case such counsel may state that itdoes not express any view as to the financial statements, schedules and otherfinancial or statistical information derived from such financial statements orschedules included or incorporated by reference therein).

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**FORM OFOPINION OF WILKIE FARR & GALLAGHER**

1.             The Company is not, and aftergiving effect to the offering and sale of the Shares and the application of theproceeds thereof as described under the caption “Use of Proceeds” in theProspectus will not be, an “investment company,” as such term is defined in theInvestment Company Act of 1940, as amended.

2.             We have reviewed the information inthe Prospectus under the caption “Risk Factors — Risks Related to Our Business— We have a limited operating history and may not operate successfully,” “RiskFactors — Risks Related to Our Business — Maintenance of our Investment CompanyAct exemption imposes limits on our operations” and “Risk Factors — RisksRelated to Our Business — Rapid changes in the values of our MBS and other realestate related investments may make it more difficult for us to maintain ourqualification as a REIT or exemption from the Investment Company Act” and, ineach case, to the extent that such information constitutes matters of law,summaries of legal matters or documents, summaries of certain provisions of theOrganizational Documents of the Company, the Operating Partnership or theManager or legal conclusions, such information is correct in all materialrespects.

 

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**Exhibit 7(n)(2)**

**Mattersto be covered by subsequent Company Counsel Opinions**

(i)            The Registration Statement hasbecome effective under the Securities Act and, to the knowledge of suchcounsel, no stop order suspending the effectiveness of the Registration Statementhas been issued and no proceeding for that purpose is pending or threatened bythe Commission.

(ii)           The Registration Statement, at eachdeemed effective date with respect to CF&Co pursuant to Rule 430B(f)(2) andthe Prospectus, as of the date of the Prospectus Supplement (in each case,other than (i) the financial statements, including the notes and schedulesthereto, (ii) any other financial data and (iii) statistical datathat is found in or derived from the internal accounting records of the Company,the Operating Partnership or their respective subsidiaries, in each case as setforth or incorporated by reference therein, as to which no opinion need berendered), complied as to form in all material respects with the requirementsof the Securities Act and the Exchange Act.

(c)           Commencingwith its taxable year ended December 31, 2004, the Company has beenorganized and operated in conformity with the requirements for qualificationand taxation as a REIT under the Code, and the Company’s current and proposedmethod of operation, as described in the Prospectus and as set forth in acertificate of representations from the Company, will enable it to continue tomeet the requirements for qualification and taxation as a REIT under the Code.

In addition, such opinion shall also contain astatement that such counsel has participated in conferences with officers andother representatives of the Company, representatives of the independentaccountants at which the contents of the Registration Statement* and theProspectus and related matters were discussed, and although it does not passupon, or assume any responsibility for, the accuracy, completeness or fairnessof the statements contained in the Registration Statement or the Prospectus andhave made no independent check or verification thereof (except to the extentreferred to in paragraph eight of its opinion to the CF&Co dated the datehereof), on the basis of the foregoing, (i) the Registration Statement(including the Incorporated Documents), at each deemed effective date withrespect to CF&Co pursuant to Rule 430B(f)(2), and the Prospectus, as of itsdate, as of each Applicable Time and as of the date hereof, complied andcomplies as to form in all material respects with the requirements of the 1933 Actand the 1933 Act Regulations (except that in each case such counsel may statethat it does not express any view as to the financial statements, schedules andother financial or statistical information derived from such financialstatements and schedules included or incorporated by reference therein) and(ii) no facts have come to such counsel’s attention that have caused it tobelieve that the Registration Statement, at each deemed effective date withrespect to CF&Co pursuant to Rule 430B(f)(2), contained an untrue statementof a material fact or omitted to state any material fact required to be statedtherein or necessary to make the statements therein not misleading or that theProspectus, as of its date, as of each Applicable Time and as of the date hereof,contained or contains an untrue statement of a material fact or omitted oromits to state a material fact necessary in order to make the statementstherein, in light 

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of the circumstances under which they were made, notmisleading (except that in each case such counsel may state that it does notexpress any view as to the financial statements, schedules and other financialor statistical information derived from such financial statements or schedulesincluded or incorporated by reference therein).

*  Note: “RegistrationStatement” and “Prospectus” will be defined to include documents incorporatedby reference therein (“**Incorporated Documents**”).

 

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**Exhibit 8(m) **

**OFFICERCERTIFICATE**

The undersigned, the dulyqualified and elected _______________________, of **GRAMERCYCAPITAL CORP.**(“**Company**”),a Marylandcorporation, does hereby certify in such capacity and on behalf of the Company,pursuant to Section 7(m) of the Sales Agreement dated May 10,2006 (the “**Sales Agreement**”) between theCompany and Cantor Fitzgerald & Co., that to the best of the knowledgeof the undersigned.

(i)            Therepresentations and warranties of the Company, the Operating Partnership, andthe Manager in Section 6 of the Sales Agreement (A) to theextent such representations and warranties are subject to qualifications andexceptions contained therein relating to materiality or Material AdverseEffect, are true and correct on and as of the date hereof, except for thoserepresentations and warranties that speak solely as of a specific date andwhich were true and correct as of such date, with the same force and effect asif expressly made on and as of the date hereof and (B) to the extent suchrepresentations and warranties are not subject to any qualifications orexceptions, are true and correct in all material respects as of the date hereofas if made on and as of the date hereof except for those representations andwarranties that speak solely as of a specific date and which were true andcorrect as of such date, with the same force and effect as if expressly made onand as of the date hereof; and

(ii)           TheCompany, the Operating Partnership, and the Manager has complied with allagreements and satisfied all conditions on its part to be performed orsatisfied pursuant to the Sales Agreement at or prior to the date hereof.

 
|        |   |   |   | GRAMERCY CAPITAL CORP.                       |
|--------|--------|--------|--------|----------------------------------------------|
|   |   |   |   |                                         |
|   |   |   |   |                                         |
|   |   | By:    |   |                                         |
|   |   | Name:  |   |                                         |
|   |   | Title: |   |                                         |
|   |   |   |   |                                         |
|   |   |   |   |                                         |
|   |   |   |   | GKK CAPITAL LP                               |
|   |   |   |   |                                         |
|   |   |   |   |                                         |
|   |   | By:    |   | Gramercy Capital Corp., its  General Partner |
|   |   |   |   |                                         |
|   |   |   |   |                                         |
|   |   | By:    |   |                                         |
|   |   | Name:  |   |                                         |
|   |   | Title: |   |                                         |

 

 

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|        |   |   |   | GKK MANAGER LLC |
|--------|--------|--------|--------|-----------------|
|   |   |   |   |            |
|   |   |   |   |            |
|   |   | By:    |   |            |
|   |   | Name:  |   |            |
|   |   | Title: |   |            |
|   |   |   |   |            |
|   |   |   |   |            |
| Date:  |   |   |   |            |   |   |   |   |
|        |        |        |        |                 |  |  |  |  |

 

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