Document:

Exhibit 10.2

 

ROCKWOOD HOLDINGS, INC.
 MARKET STOCK UNIT AWARD AGREEMENT

 

THIS AGREEMENT (the “Agreement”), is made, effective as of December 2, 2011 (the “Grant Date”) between Rockwood Holdings, Inc., a Delaware corporation (hereinafter called the “Company”), and [NAME], an employee of the Company or an Affiliate, hereinafter referred to as the “Employee”.  For purposes of this Agreement, capitalized terms not otherwise defined above or below, or in the 2009 Stock Incentive Plan for Rockwood Holdings, Inc. and Subsidiaries (the “Plan”), shall have the meanings set forth in Appendix A attached to this Agreement and incorporated by reference herein.

 

WHEREAS, the Company desires to grant the Employee market stock unit awards as provided for hereunder (the “Market Stock Unit Awards”), ultimately payable in shares of common stock of the Company, par value $0.01 per share (the “Common Stock”), pursuant to the Plan, the terms of which are hereby incorporated by reference and made a part of this Agreement; and

 

WHEREAS, the committee of the Company’s Board appointed to administer the Plan (the “Committee”) has determined that it would be to the advantage and best interest of the Company and its shareholders to grant the shares of Common Stock that may be issued hereunder to the Employee as an incentive for increased efforts during his term of office with the Company or an Affiliate, and has advised the Company thereof and instructed the undersigned officers to grant said Market Stock Unit Awards.

 

NOW, THEREFORE, in consideration of the mutual covenants herein contained and other good and valuable consideration, receipt of which is hereby acknowledged, the parties hereto do hereby agree as follows:

 

1.             Grant of the Market Stock Units.  Subject to the terms and conditions of the Plan and the additional terms and conditions set forth in this Agreement, the Company hereby grants to the Employee the opportunity to vest in Market Stock Unit Awards, which shall vest in accordance with Section 2(a) herein (the “MSUs”) up to a number of MSUs equal to the product of (x) 1.5 multiplied by (y) your Target MSU Award (as defined below), which shall be rounded up to the nearest whole number of MSUs in the event that the such product results in a fractional number of MSUs (the “Maximum MSU Award”).  Your Target MSU Award shall be [insert target number of MSUs] MSUs (the “Target MSU Award”).(1)  An “MSU” represents the right to receive one share of Common Stock.  The MSUs shall vest and become nonforfeitable in accordance with Section 2 hereof.

 

(1)  Target MSU Award will be based on the desired grant value divided by the product of (1) the average closing stock price for the 20 trading days leading up to and including the Grant Date and (2) the value of each MSU as a percentage of the closing stock price on the Grant Date.

 

 

2.             Vesting.

 

(a)           Performance-Based MSUs.  The vesting of the MSUs shall be subject to the satisfaction of the Code of Ethics Requirement, as well as the conditions set forth in both subsection (i)(A), (B) or (C), as applicable, and subsection (ii) of this Section 2(a):

 

(i)            Service Vesting Requirement.

 

(A)          Unless otherwise provided in this Agreement, so long as the Employee continues to be employed by the Company or its Subsidiaries through January 1, 2015 (the “Vesting Date”), the Employee shall, on the Vesting Date, vest in a number of MSUs (not to exceed the number of MSUs provided as the Maximum MSU Award set forth in Section 1 above) determined based on the formulas set forth in Section 2(a)(ii) below.

 

(B)           If, prior to the Vesting Date (and absent the occurrence of any Change in Control), the Employee’s employment with Company and its Subsidiaries is terminated for any reason (other than due to the Employee’s death, Disability or Retirement), then the MSUs shall be forfeited by the Employee without consideration as of such termination date and this Agreement shall terminate without payment in respect thereof.  Notwithstanding the previous sentence, if, prior to the Vesting Date (and absent the occurrence of any Change in Control), the Employee’s employment with the Company and its Subsidiaries is terminated by the Company and its Subsidiaries other than for Cause, then the Committee has the sole discretion to elect whether this Agreement will remain outstanding and, as of the Vesting Date, whether the Employee will become entitled to receive a distribution of a number of shares of Common Stock equal to the product of (x) the number of MSUs in which the Employee would have become vested pursuant to Section 2(a)(ii) below, if the Employee had remained employed with the Company or a Subsidiary through the Vesting Date, and (y) a fraction, the numerator of which is equal to the number of days between (and including) the Grant Date and the date such employment so terminates, and the denominator of which is equal to 1097 (such fraction, the “Proration Factor”) (such shares, the “Prorated MSU Shares”).

 

(C)           If, during the Award Period (and absent the occurrence of any Change in Control), the Employee’s employment with the Company and its Subsidiaries is terminated by the Employee due to the Employee’s death, Disability or Retirement, then this Agreement shall remain outstanding and, as of the Vesting Date, the Employee shall become entitled to receive a distribution of Prorated MSU Shares (determined based on the formula set forth in Section 2(a)(i)(B) above); provided that, in the event of a termination by the Employee due to Retirement, the distribution of Prorated MSU Shares are conditioned upon compliance with any non-compete, non-solicitation, non-disclosure and non-disparagement restrictions in any agreement or policy with the Company or its Affiliates during the remaining portion of the Award Period and violation of any such restrictions shall result in immediate forfeiture of the entire amount of Prorated MSU Shares.

 

(ii)           Performance Vesting Requirement.

 

(A)          The MSUs shall, so long as the Employee remains employed with the Company or its Subsidiaries through the Vesting Date (or the provisions of Section 2(a)(i)(B) or

 

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(C) otherwise apply), vest on the Vesting Date as to a number of shares of Common Stock equal to: the product of (x) the Target MSU Award and (y) the Stock Price Multiplier, provided that, no MSUs shall be earned if the Ending Stock Price is less than fifty percent (50%) of the Beginning Stock Price.

 

(B)           Whether and to what extent the MSUs shall vest shall be determined by the Committee at its first meeting following the end of the Award Period (which shall occur in no event later than 75 days after the end of the calendar year in which the Award Period ends (i.e., by no later than March 15, 2015)), upon the Committee’s certification of achievement of the applicable performance goals set forth in Section 2(a)(ii)(A) above.

 

(iii)          Settlement of MSUs.  Promptly after the Vesting Date (but in no event later than 75 days after the end of the calendar year in which the Award Period ends (i.e., by no later than March 15, 2015)) the Company shall distribute to the Employee a number of shares of Common Stock equal to the number of MSUs that become vested in accordance with Section 2(a) hereof.  Any number of MSUs that do not become vested in accordance with Section 2(a) hereof (to the extent not already previously forfeited pursuant to Section 2(a)(i)(B) or (C) above) shall, effective as of the Vesting Date, be forfeited by the Employee without consideration and this Agreement shall terminate without payment in respect thereof.

 

(b)           Effect of Change in Control.  Notwithstanding anything set forth in Section 2(a) above, if there occurs a Change in Control, the following rules shall apply with respect to the MSUs granted hereunder in lieu of the provisions of Section 2(a) above:

 

(i)            Unless otherwise determined by the Committee, if a Change in Control occurs prior to the Vesting Date, and the Employee is still employed with the Company or its Subsidiaries upon the occurrence of such Change in Control, then this Market Stock Unit Award shall be converted into a right to receive a cash payment equal to the sum of (x) the product of (1) the Target MSU Award, (2) the Stock Price Multiplier and (3) the CIC Per Share Price (such product of clauses (1), (2) and (3), the “CIC Cash Value”) and (y) an amount equal to the interest on the CIC Cash Value accrued at a rate equal to LIBOR plus 2.0% per annum, computed on the basis of a year of 364 days, calculated daily for each day following the closing date of the Change in Control transaction through the date immediately preceding the date on which such cash payment becomes vested (the sum of clauses (x) and (y), the “CIC Settlement Amount”).  The Employee shall become 100% vested in the CIC Settlement Amount on the Vesting Date, so long as the Employee remains employed with the Company, any subsidiary or successor or acquirer thereof (or any of its affiliates) in the Change in Control through the Vesting Date, subject to the provisions of Section 2(b)(ii) below.  The CIC Settlement Amount shall be paid to the Employee within ten (10) business days after the Vesting Date.

 

(ii)           Notwithstanding Section 2(b)(i) above, if the Employee’s employment with the Company and its Subsidiaries is terminated by the Company and its Subsidiaries other than for Cause or by the Employee for Good Reason during the twenty-four (24) month period following the Change in Control (and prior to the Vesting Date), the Employee shall be immediately vest in the right to receive the CIC Settlement Amount, and the Employee shall receive payment of the CIC Settlement Amount within ten (10) business days following such termination date.

 

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3.             Dividend Equivalents.  With respect to each cash dividend or distribution (if any) paid with respect to Common Stock to holders of record on and after the Grant Date, a number of shares of Common Stock shall be accrued on the books and records of the Company, in an amount equal to the quotient of (a) the product of (i) the amount of such dividend or distribution paid with respect to one share of Common Stock, multiplied by (ii) the number of vested MSUs (if any) granted hereunder then held by the Employee, divided by (b) the Fair Market Value on the applicable dividend record date.  At such time(s) thereafter as the Employee receives a distribution of shares of Common Stock in respect of his or her vested MSUs granted hereunder pursuant to the applicable provision of Section 2 above, the Company shall also distribute to the Employee such number of shares of Common Stock accrued under this Section 3 that relate to the vested MSUs in respect of which such distribution of shares is otherwise being made.  In the event of any stock dividend, the provisions of Section 9 of the Plan shall apply to this Market Stock Unit Award.

 

4.             Limitation on Obligations.  The Company’s obligation with respect to the MSUs granted hereunder is limited solely to the delivery to the Employee of shares of Common Stock on the date when such shares are due to be delivered hereunder, and in no way shall the Company become obligated to pay cash in respect of such obligation, except as otherwise expressly provided for herein.  This Market Stock Unit Award shall not be secured by any specific assets of the Company or any of its Subsidiaries, nor shall any assets of the Company or any of its subsidiaries be designated as attributable or allocated to the satisfaction of the Company’s obligations under this Agreement.

 

5.             Rights as a Stockholder.  The Employee shall not have any rights of a common stockholder of the Company unless and until the Employee becomes entitled to receive the shares of Common Stock pursuant to Section 2 above.  As soon as practicable following the date that the Employee receives the shares of Common Stock pursuant to Section 2, certificates for the Common Stock shall be delivered to the Employee or to the Employee’s legal guardian or representative.

 

6.             Transferability.  The MSUs shall not be subject to alienation, garnishment, execution or levy of any kind, and any attempt to cause any such awards to be so subjected shall not be recognized.  The shares of Common Stock acquired by the Employee pursuant to Section 2 of this Agreement may not at any time be transferred, sold, assigned, pledged, hypothecated or otherwise disposed of unless such transfer, sale, assignment, pledge, hypothecation or other disposition complies with applicable securities laws.

 

7.             Purchaser’s Employment by the Company.   Nothing contained in this Agreement obligates the Company or any Subsidiary to employ the Employee in any capacity whatsoever or prohibits or restricts the Company (or any Subsidiary) from terminating the employment, if any, of the Employee at any time or for any reason whatsoever, with or without Cause, and the Employee hereby acknowledges and agrees that neither the Company nor any other Person has made any representations or promises whatsoever to the Employee concerning the Employee’s employment or continued employment by the Company or any Affiliate thereof. No payment under this Agreement shall be taken into account in determining any benefits under any pension, retirement, savings, profit sharing, group insurance, welfare or benefit plan of the Company unless provided otherwise in such other plan.

 

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8.             Change in Capitalization.  Except as provided in Section 2(b) above, in the event of any change in the outstanding Common Stock by reason of a stock split, spin-off, stock dividend, stock combination or reclassification, recapitalization or merger, Change in Control, or similar event, the provisions of Section 8 of the Plan shall govern the treatment of this Market Stock Unit Award.

 

9.             Withholding.   It shall be a condition of the obligation of the Company upon delivery of Common Stock or cash, as applicable, to the Employee pursuant to Section 2 above that the Employee pay to the Company such amount as may be requested by the Company for the purpose of satisfying any liability for any federal, state or local income or other taxes required by law to be withheld with respect to such Common Stock or cash, as applicable.  The Company shall be authorized to take such action as may be necessary, in the opinion of the Company’s counsel (including, without limitation, withholding Common Stock or cash, as applicable, otherwise deliverable to the Employee hereunder and/or withholding amounts from any compensation or other amount owing from the Company to the Employee), to satisfy the obligations for payment of the minimum amount of any such taxes.  In addition, if the Company’s accountants determine that there would be no adverse accounting implications to the Company, the Employee may be permitted to elect to use Common Stock otherwise deliverable to the Employee hereunder to satisfy any such obligations, subject to such procedures as the Company’s accountants may require.  The Employee is hereby advised to seek his own tax counsel regarding the taxation of the grant of MSUs made hereunder.

 

10.           Securities Laws.  Upon the delivery of any Common Stock to the Employee, the Company may require the Employee to make or enter into such written representations, warranties and agreements as the Committee may reasonably request in order to comply with applicable securities laws or with this Agreement.  The delivery of the Common Stock hereunder shall be subject to all applicable laws, rules and regulations and to such approvals of any governmental agencies as may be required.

 

11.           Clawback; Forfeiture on Violation of Code of Ethics.

 

(a)           The Committee in its sole discretion may impose on the MSUs provided for in this Agreement, either through an amendment to the Plan or through a policy that upon adoption by the Committee will be incorporated into this Agreement by reference effective as of the date of such adoption, that the Employee’s rights, payments, and benefits with respect to this Agreement shall be subject to reduction, cancellation, forfeiture or recoupment upon the occurrence of certain specified events, in addition to any otherwise applicable vesting or performance conditions provided in this Agreement, as required by applicable law. Such events may include, but shall not be limited to, a restatement of the Company’s financial statements to reflect adverse results from those previously released financial statements, as a consequence of errors, omissions, fraud, or misconduct, or the Employee’s failure to satisfy the Code of Ethics Requirement.

 

(b)           In the event that the Employee fails to satisfy the Code of Ethics Requirement, all MSUs granted hereunder (to the extent not already previously forfeited) may be immediately forfeited by the Employee without consideration based upon a determination by the Committee and this Agreement shall terminate without payment in respect thereof.

 

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12.           Section 409A of the Code.  In the event that it is reasonably determined by the Company that, as a result of the deferred compensation tax rules under Section 409A of the Code (and any related regulations or other pronouncements thereunder) (the “Deferred Compensation Tax Rules”), benefits that the Employee is entitled to under the terms of this Agreement may not be made at the time contemplated by the terms hereof or thereof, as the case may be, without causing Employee to be subject to tax under the Deferred Compensation Tax Rules, the Company shall, in lieu of providing such benefit when otherwise due under this Agreement, instead provide such benefit on the first day on which such provision would not result in the Employee incurring any tax liability under the Deferred Compensation Tax Rules; which day, if the Employee is a “specified employee” (within the meaning of the Deferred Compensation Tax Rules), shall, in the event the benefit to be provided is due to the Employee’s “separation from service” (within the meaning of the Deferred Compensation Tax Rules) with the Company and its Subsidiaries, be the first day following the six-month period beginning on the date of such separation from service.

 

13.           Notices.  Any notice to be given under the terms of this Agreement to the Company shall be addressed to the Company in care of its Secretary, and any notice to be given to the Employee shall be addressed to him at the address given beneath his signature hereto.  By a notice given pursuant to this Section 13, either party may hereafter designate a different address for notices to be given to him.  Any notice which is required to be given to the Employee shall, if the Employee is then deceased, be given to the Employee’s personal representative if such representative has previously informed the Company of his status and address by written notice under this Section 13.  Any notice shall have been deemed duly given when enclosed in a properly sealed envelope or wrapper addressed as aforesaid, deposited (with postage prepaid) in a post office or branch post office regularly maintained by the United States Postal Service.

 

14.           Governing Law.  The laws of the State of Delaware (or if the Company reincorporates in another state, the laws of that state) shall govern the interpretation, validity and performance of the terms of this Agreement regardless of the law that might be applied under principles of conflicts of laws.

 

15.           Market Stock Unit Award Subject to Plan.   The Market Stock Unit Award shall be subject to all applicable terms and provisions of the Plan, to the extent applicable to the Common Stock.   In the event of any conflict between this Agreement and the Plan, the terms of the Plan shall control.

 

16.           Signature in Counterparts.  This Agreement may be signed in counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument.

 

[Signatures on next page.]

 

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement effective as of the date hereof.

 

	
 
    	
ROCKWOOD   HOLDINGS, INC.
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    
	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
EMPLOYEE
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
[NAME]
    

 

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Appendix A

 

Definitions

 

“Award Period” shall mean the three year period beginning on January 1, 2012 and ending on December 31, 2014.

 

“Beginning Stock Price” shall mean the average closing price per share of Common Stock for the sixty (60) trading day period ending immediately prior to January 1, 2012.

 

“Cause” shall mean (i) the Employee’s willful and continued failure to perform duties, which are within the control of the Employee and consistent with such Employee’s title and position, that is not cured within 15 days following written notice of such failure, (ii) the Employee’s conviction of or plea of guilty or no contest to a (x) felony or (y) crime involving moral turpitude, (iii) the Employee’s willful malfeasance or misconduct which is injurious to the Company or its Subsidiaries, other than in a manner that is insignificant or inconsequential, (iv) a breach by Employee of the material terms of any non-compete, non-solicitation or confidentiality covenants or agreements by which the Employee may be bound, following notice of such breach (which notice may be oral or written) or (v) any violation by the Employee of any material written Company policy after written notice of such breach, if such violation is shown by the Company to be reasonably expected to result in material injury to the business, reputation or financial condition of the Company.

 

“Change in Control” shall mean the earliest to occur of the following:

 

(i)            any Person (which term shall mean any individual, corporation, partnership, group, association or other “person,” as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended, other than the Company or any employee benefit plans sponsored by the Company) is or becomes the “beneficial owner” (as defined in Rule 13d-3 under such Act), directly or indirectly, of securities of the Company representing 30% or more of the combined voting power of the Company’s outstanding Voting Securities (which term shall mean securities which under ordinary circumstances are entitled to vote for the election of directors) other than through the purchase of Voting Securities directly from the Company through a private placement;

 

(ii)           individuals who constitute the Board on the date hereof (the “Incumbent Board”) cease for any reason to constitute at least a majority thereof, provided that any person becoming a director subsequent to the date hereof whose election, or nomination for election by the Company’s shareholders, was approved by a vote of at least a majority of the directors comprising the Incumbent Board shall from and after such election be deemed to be a member of the Incumbent Board;

 

(iii)          a merger or consolidation involving the Company or its stock or an acquisition by the Company, directly or indirectly or through one or more subsidiaries, of another entity or its stock or assets in exchange for the stock of the Company is consummated, unless, immediately following such transaction, 50.1% or more of the then outstanding Voting Securities of the surviving or resulting corporation or entity will be (or is) then beneficially owned, directly or

 

 

indirectly, by the individuals and entities who were the beneficial owners of the Company’s outstanding Voting Securities immediately prior to such transaction (treating, for purposes of determining whether the 50.1% continuity test is met, any ownership of the Voting Securities of the surviving or resulting corporation or entity that results from a stockholder’s ownership of the stock of, or other ownership interest in, the corporation or other entity with which the Company is merged or consolidated as not owned by persons who were beneficial owners of the Company’s outstanding Voting Securities immediately prior to the transaction); or

 

(iv)          all or substantially all of the assets of the Company are sold or transferred to a Person as to which (A) the Incumbent Board does not have authority (whether by law or contract) to directly control the use or further disposition of such assets and (B) the financial results of the Company and such Person are not consolidated for financial reporting purposes.

 

Notwithstanding the foregoing, a Change in Control shall not be deemed to occur unless such transaction or occurrence constitutes a change in ownership or effective control within the meaning of Section 409A(a)(2)(A)(v) of the Code.

 

“CIC Per Share Price” shall mean the price per share paid for one share of Common Stock in the Change in Control transaction (with the value of any security that is paid as consideration in the Change in Control determined by the Committee as of the date of such Change in Control).

 

“Code of Ethics Requirement” shall mean the Employee complies with the Company’s Code of Business Conduct and Ethics, dated November 23, 2009 or, if applicable, the Company’s Code of Ethics for Executive Officers and Financial Officers, as adopted July 29, 2005, as the same may be amended from time to time.

 

“Disability” shall mean a determination, made at the request of the Employee or upon the reasonable request of the Company set forth in a notice to the Employee, by a physician selected by the Company and the Employee, that the Employee is unable to perform his duties as an employee of the Company or its Subsidiaries and in all reasonable medical likelihood such inability will continue for a period in excess of 180 consecutive days.

 

“Ending Stock Price” shall mean the average closing price per share of Common Stock for the sixty (60) trading day period ending immediately prior to January 1, 2015; except that in the event of a Change in Control, for purposes of determining the Stock Price Multiplier, the Ending Stock Price shall be the CIC Per Share Price.

 

“Good Reason” shall mean without the Employee’s consent, (i) a reduction in the Employee’s base salary or annual bonus opportunity (other than a reduction in base salary that is offset by an increase in bonus opportunity upon the attainment of reasonable financial targets, which reduction may not exceed 10% of the Employee’s base salary in any 12 month period), (ii) a substantial reduction in the Employee’s duties and responsibilities, which continues beyond 15 days after written notice by the Employee to the Company of such reduction, (iii) the elimination or reduction of the Employee’s eligibility to participate in the Company’s benefit programs that is inconsistent with the eligibility of similarly situated employees of the Company to participate therein, (iv) a transfer of the Employee’s primary workplace by more than 35 miles from the

 

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current workplace, (v) any serious chronic mental or physical illness of an immediate family member that requires the Employee to terminate his or her employment with Company because of a substantial interference with his or her duties at the Company or (vi) any failure by the Company to pay when due any payment owed to the Employee within 15 days after the date such payment becomes due.  In order for Employee to resign pursuant to this definition of “Good Reason”, Employee shall have first given written notice of the alleged defect within thirty (30) business days of the event giving rise to such claim of Good Reason, and the same shall not have been cured (if capable of cure) within thirty (30) business days of such written notice.

 

“LIBOR” shall mean the three-month London interbank offered rate as published in the Wall Street Journal on the business day following the closing date of the Change in Control transaction and each anniversary thereafter.

 

“Retirement” shall mean retirement at age 62 or over (or such other age as may be approved by the Board of Directors) after having been employed by the Company or a Subsidiary for at least ten years.

 

“Stock Price Multiplier” shall mean the quotient of (x) the Ending Stock Price, divided by (y) the Beginning Stock Price.

 

3Exhibit 10.1

 

DEVELOPMENT AGREEMENT

 

AMONG

 

IRONSTATE DEVELOPMENT LLC (“Ironstate”)

 

AND

 

M-C PLAZA VI & VII L.L.C. (“Owner”)

 

DATED AS OF

 

DECEMBER 5, 2011

 

 

TABLE OF CONTENTS

 

	
 
    	
 
    	
PAGE
    
	
 
    	
 
    
	
ARTICLE 1 - THE PROJECT
    	
1
    
	
Section 1.1
    	
The Project
    	
1
    
	
Section 1.2
    	
Phases
    	
1
    
	
Section 1.2.1
    	
Phase I
    	
1
    
	
Section 1.2.2
    	
Phase II
    	
2
    
	
Section 1.2.3
    	
Phase III
    	
2
    
	
Section 1.3
    	
General Development Plan
    	
3
    
	
 
    	
 
    	
 
    
	
ARTICLE 2 - DEVELOPMENT OF   THE PROJECT
    	
3
    
	
Section 2.1
    	
Retention
    	
3
    
	
Section 2.2
    	
Development Services
    	
3
    
	
Section 2.3
    	
Costs and Expenses
    	
6
    
	
Section 2.4
    	
Authority of Ironstate
    	
7
    
	
Section 2.5
    	
Use of Mack-Cali Name
    	
7
    
	
Section 2.6
    	
Use of Ironstate Name
    	
7
    
	
Section 2.7
    	
Compliance with Laws
    	
7
    
	
Section 2.8
    	
Overall Standard of Care
    	
7
    
	
 
    	
 
    	
 
    
	
ARTICLE 3 - COMPENSATION
    	
7
    
	
Section 3.1
    	
No Reimbursement
    	
7
    
	
Section 3.2
    	
Development Fee
    	
7
    
	
 
    	
 
    	
 
    
	
ARTICLE 4 - REPRESENTATIONS   AND WARRANTIES
    	
7
    
	
Section 4.1
    	
By Ironstate
    	
8
    
	
Section 4.2
    	
By Owner
    	
9
    
	
 
    	
 
    	
 
    
	
ARTICLE 5 - CAPITAL   CONTRIBUTIONS
    	
11
    
	
Section 5.1
    	
Phase I Capital Contribution
    	
10
    
	
Section 5.2
    	
Phase II Capital Contribution
    	
11
    
	
Section 5.3
    	
Phase III Capital Contribution
    	
11
    
	
 
    	
 
    	
 
    
	
ARTICLE 6 - CLOSING
    	
11
    
	
Section 6.1
    	
Phase I Closing
    	
11
    
	
Section 6.2
    	
Owner’s Phase I Closing Deliverables
    	
12
    
	
Section 6.3
    	
Ironstate’s Phase I Closing Deliverables
    	
13
    
	
Section 6.4
    	
Phase II Closing
    	
13
    
	
Section 6.5
    	
Owner’s Phase II Closing Deliverables
    	
13
    
	
Section 6.6
    	
Ironstate’s Phase II Closing Deliverables
    	
14
    
	
Section 6.7
    	
Phase III Closing
    	
15
    
	
Section 6.8
    	
Owner’s Phase III Closing Deliverables
    	
15
    
	
Section 6.9
    	
Ironstate’s Phase III Closing Deliverables
    	
16
    
	
 
    	
 
    	
 
    
	
ARTICLE 7 - CONDITIONS TO   CLOSING 
    	
16
    
	
Section 7.1
    	
Conditions to Phase I Closing
    	
16
    
				

 

1

 

	
Section 7.1.1
    	
Conditions to Ironstate’s Obligations
    	
16
    
	
Section 7.1.2
    	
Conditions to Owner’s Obligations
    	
17
    
	
Section 7.2
    	
Conditions to Phase II Closing
    	
18
    
	
Section 7.2.1
    	
Conditions to Ironstate’s Obligations
    	
18
    
	
Section 7.2.2
    	
Conditions to Owner’s Obligations
    	
19
    
	
Section 7.3
    	
Conditions to Phase III Closing
    	
19
    
	
Section 7.3.1
    	
Conditions to Ironstate’s Obligations
    	
19
    
	
Section 7.3.2
    	
Conditions to Owner’s Obligations
    	
21
    
	
 
    	
 
    	
 
    
	
ARTICLE 8 - TERM, DEFAULT;   TERMINATION
    	
21
    
	
Section 8.1
    	
Term
    	
21
    
	
Section 8.2
    	
Events of Default
    	
21
    
	
Section 8.3
    	
Remedies on Default
    	
22
    
	
Section 8.4
    	
Early Termination
    	
22
    
	
Section 8.5
    	
Fees on Termination
    	
 
    
	
Section 8.6
    	
Default by Owner 
    	
23
    
	
Section 8.7
    	
Use of the Property upon Termination
    	
25
    
	
Section 8.8
    	
Reimbursement of Ironstate Development Costs
    	
 
    
	
 
    	
 
    	
 
    
	
ARTICLE 9 - CONDEMNATION AND   RISK OF LOSS
    	
25
    
	
Section 9.1
    	
Condemnation
    	
25
    
	
Section 9.2
    	
Risk of Loss
    	
25
    
	
 
    	
 
    	
 
    
	
ARTICLE 10   - NON-COMPETITION
    	
26
    
	
Section 10.1
    	
Non-Complete
    	
26
    
	
Section 10.2
    	
Exceptions to Non-Compete
    	
26
    
	
Section 10.3
    	
Injunctive Relief
    	
26
    
	
 
    	
 
    	
 
    
	
ARTICLE 11 - MISCELLANEOUS
    	
25
    
	
Section 11.1
    	
Assignment
    	
26
    
	
Section 11.2
    	
Confidentiality
    	
26
    
	
Section 11.3
    	
Notices
    	
26
    
	
Section 11.4
    	
Successors and Assigns
    	
27
    
	
Section 11.5
    	
Severability
    	
27
    
	
Section 11.6
    	
Entire Contract
    	
27
    
	
Section 11.7
    	
Exhibits
    	
28
    
	
Section 11.8
    	
Headings; Interpretation; Counterparts
    	
28
    
	
Section 11.9
    	
Applicable Law
    	
28
    
	
Section 11.10
    	
Choice of Forum
    	
28
    
	
Section 11.11
    	
Tax Consequences
    	
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Exhibit A - The Property

Exhibit B - Definitions

Exhibit C - Form of Operating Agreement

Exhibit D - Major Decisions

Exhibit E - Permitted Exception

Exhibit F - Ironstate Permitted Projects

 

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DEVELOPMENT AGREEMENT

 

This Development Agreement (this “Agreement”) is dated as of December 5, 2011 (the “Effective Date”), by and between, M-C PLAZA VI & VII L.L.C., a New Jersey limited liability company  (“Owner”) and IRONSTATE DEVELOPMENT LLC, a New Jersey limited liability company (“Ironstate”).  Ironstate and Owner are sometimes collectively referred to as the “Parties” and individually referred to as a “Party”.

 

RECITALS

 

A.            Owner is the owner of those certain tracts or parcels of land commonly known as Plaza 6 and Plaza 7 (Lot 22, Block 10) located in the County of Hudson, City of Jersey City, State of New Jersey, and being more particularly described on Exhibit A appended hereto and made a part hereof (collectively, the “Property”).

 

B.            All capitalized terms not otherwise defined herein shall have the meanings ascribed to them in Exhibit B to this Agreement.

 

C.            Ironstate and Owner have agreed to jointly undertake the development of the Project, which development shall include, but not be limited to, (i) the creation of a scheme of condominium development, governed by a master deed, which condominium scheme shall detail each of the Phases referenced therein and herein, to be developed as separate condominium unit for each of the three contemplated residential/commercial structures, (ii) the associated base parking pedestal structures, sufficient in size to provide parking for each of the contemplated condominium units as constructed, (iii) the phasing of the Project, (iv) the obtaining of the Required Approvals and (v) providing development services for the Project, all as more specifically set forth in this Agreement.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of their mutual covenants and agreements set forth herein, the parties agree as follows:

 

ARTICLE 1 - THE PROJECT

 

Section 1.1             The Project.  The Parties intend jointly to develop the Property to include up to three (3) residential projects with ancillary retail space, consisting of approximately 2,000,000 aggregate square feet of space (the “Project”).  Subject to the conditions set forth in this Agreement, Owner intends to establish the “Harborside Plaza 6 and 7 Condominium” (the “Master Condominium”) consisting of three (3) separate condominium units (each, a “Unit”) with each Unit to be developed as a phase (each, a “Phase” and collectively, the “Phases”) of the Project, as set forth herein.

 

Section 1.2             Phases.  The Phases of the Project shall be defined as follows:

 

Section 1.2.1          Phase I.  The first Phase of the Project will involve the development of approximately 1,000,000 square feet of residential space and ancillary retail

 

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space within the condominium unit, referred to as “Unit 1”, as well as the development of a parking pedestal structure within the Unit 1, all as will be generally depicted within the General Development Plan.  The Unit 1 parking structure shall be constructed so as to provide compatible points of ingress and egress and ramping systems such that the parking pedestals for Units 2 and 3, as described below, shall be capable of construction utilizing common points of ingress and egress and the ramping systems constructed for Unit 1 for each of Unit 2 and Unit 3’s parking purposes.  Upon the issuance of all Required Approvals for Unit 1 and third-party financing having been secured in an amount and upon terms and conditions approved in writing by the Owner and Ironstate for the construction of Phase I of the Project (“Approved Financing/Phase I”), Owner shall then cause a Master Deed to be recorded to effectuate the establishment of the Master Condominium and shall thereafter as “Sponsor” under the Master Condominium cause separate deeds to be recorded conveying the interests in Unit 1, Unit 2 and Unit 3 to special purpose entities (respectively, “Harborside Entity A”, “Harborside Entity B” and “Harborside Entity C”) which entities shall be wholly owned by Owner or an Affiliate of Owner (respectively, “Owner Member A”, “Owner Member B” and Owner Member C”).  Thereafter, upon the satisfaction of the Phase I Closing Conditions set forth in Section 7.1 hereof:

 

(a)           Ironstate or an Affiliate of Ironstate (“Ironstate Member A”) shall be admitted as member, having a fifteen percent (15%) interest, in Harborside Entity A (the “Ironstate Member A Interest”) on the terms and conditions set forth herein; and

 

(b)           Simultaneously upon Ironstate Member A’s admission as a member into Harborside Entity A, Ironstate Member A and Owner Member A shall enter into an amended and restated operating agreement for Harborside Entity A substantially in the form attached hereto as Exhibit C (the “Harborside Entity A Operating Agreement”).

 

Section 1.2.2          Phase II.  Upon (i) receipt of third party financing in an amount and upon terms and conditions approved in writing by the Owner and Ironstate for the construction of Phase II of the Project (“Approved Financing/Phase II”) , (ii) issuance of the Required Approvals for Phase II of the Project to be developed upon the second condominium Unit, which development shall include all Unit 2 ancillary parking requirements, all as will be generally depicted within the General Development Plan and referred to as “Unit 2” and (iii) the satisfaction of the Phase II Closing Conditions set forth in Section 7.2 hereof:

 

(a)           Ironstate or an Affiliate of Ironstate (“Ironstate Member B”) shall thereafter be admitted as a member having a fifteen percent (15%) interest in Harborside Entity B (the “Ironstate Member B Interest”) on the terms and conditions set forth herein; and

 

(b)           Simultaneously upon Ironstate Member B’s admission as a member into Harborside Entity B , Ironstate Member B and Owner Member B shall enter into an amended and restated operating agreement for Harborside Entity B substantially in the form attached hereto as Exhibit C (the “Harborside Entity B Operating Agreement”).

 

Section 1.2.3          Phase III.  Upon (i) receipt of third party financing in an amount and upon terms and conditions approved in writing by the Owner and Ironstate for the construction of Phase III of the Project (“Approved Financing/Phase III”), (ii) the issuance of the Required Approvals for Phase III of the Project to be developed upon the third condominium unit which development shall include its ancillary Unit 3 parking requirements, all as will be

 

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generally depicted within the General Development Plan and referred to as “Unit 3,” and (iii) the satisfaction of the Phase III Closing Conditions set forth in Section 7.3 hereof:

 

(a)           Ironstate or an Affiliate of Ironstate (“Ironstate Member C”) shall thereafter be admitted as a member, having a fifteen percent (15%) interest, in Harborside Entity C (the “Ironstate Member C Interest”) on the terms and conditions set forth herein; and

 

(b)           Simultaneously upon Ironstate Member C’s admission as a member into Harborside Entity C, Ironstate Member C and Owner Member C shall enter into an amended and restated operating agreement for Harborside Entity C substantially in the form attached hereto as Exhibit C (the “Harborside Entity C Operating Agreement”).

 

Section 1.3             General Development Plan.  Within 180 days of the date of this Agreement, the Parties shall jointly prepare a general development plan (the “General Development Plan”) for the Project, including a description of the Project as well as projected timelines for its development, including the dates by which essential elements of each Phase of the Project are scheduled be completed.  The Parties agree to use commercially reasonable and diligent efforts at all times to adhere to the timelines, goals and other terms set forth in the General Development Plan.

 

ARTICLE 2 - DEVELOPMENT OF THE PROJECT

 

Section 2.1             Retention.  Ironstate shall act as the lead developer of the Project and perform the services more fully set forth herein.  Ironstate hereby accepts such engagement and agrees to perform the duties and undertake the responsibilities herein set forth.  Ironstate shall at all times use commercially reasonable and diligent efforts in the performance of its obligations.  As to the Project, Ironstate shall perform the services, undertake the responsibilities and exercise the authority set forth in this Agreement in the role of lead developer, with the ultimate responsibility for overseeing and ensuring that all services and tasks are performed in a fashion consistent with the Master Deed, the General Development Plan and this Agreement; provided, however, that Ironstate recognizes and acknowledges that certain decisions set forth in Exhibit D hereto (“Major Decisions”) shall require the unanimous written consent of both Ironstate and Owner.  Ironstate agrees not to take any action that constitutes a Major Decision without Owner’s written consent.  Each of Owner and Ironstate shall provide its written consent to a proposed Major Decision within a commercially reasonable period after the other Member’s request for any approval.  Ironstate shall use commercially reasonable and diligent efforts to cause the Project to be developed in accordance with the General Development Plan, the Pre-Development Budget, the Operating Budget and the Construction Budget from time to time in effect, all as shall be approved by Owner and in accordance with the terms and conditions of this Agreement and any of the Operating Agreements.

 

Section 2.2             Development Services.  Without limiting the generality of Section 2.1 and subject to Ironstate’s obligation to obtain Owner’s written consent with respect to Major Decisions, Ironstate’s services with respect to the Project (the “Development Services”) shall be rendered in accordance with the express provisions of this Agreement and shall include the following:

 

(a)           Ironstate shall obtain and undertake diligent and good faith efforts

 

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to obtain all necessary authorizations, agreements, permits, licenses and similar documents with the appropriate governmental authorities and utility companies necessary or required for the ownership, development, construction, servicing, use or operation of each Phase of the Project, including, without limitation, all final non-appealable zoning, land use, general development plan approval, preliminary and final site plan approval, subdivision approval and other regulatory permits and approvals (including any revisions or amendments to the Jersey City Exchange Place North Redevelopment Plan necessary to permit the construction of the Project) (collectively, the “Required Approvals”) and thereafter supervise the prosecution and performance of all such Required Approvals.  Ironstate shall keep the Owner apprised of its efforts to obtain the Required Approvals. At least ten (10) days prior to filing, Ironstate shall provide the Owner with a full and complete copy of any application for all Required Approvals prior to submission for approval by Owner, which approval shall not be unreasonably withheld.  Any objection to any such application submitted to Owner for approval must be issued within ten (10) days of receipt or such form of application shall otherwise be deemed approved by Owner.  Notwithstanding the foregoing, Ironstate shall not be required to obtain the approval of Owner for any Ministerial Approvals.  For purposes of this Agreement, the term “Ministerial Required Approvals” shall mean any approvals sought that are not Required Approvals or would not (i) cancel, supersede, replace or terminate any existing approval at the Property, (ii) change the General Development Plan, or (iii) result in off-site improvements or costs above any agreed upon _Pre-Development Budget.  Ironstate shall attend all meetings of regulatory bodies, civic association and other advisory groups in connection with the Required Approvals and shall keep the Owner advised and well informed of all material developments in connection with such Required Approvals.  In no event shall Ironstate or Owner, agree to any condition or limitation on or with respect to the issuance of any Required Approval which would have a material adverse impact or effect on the scope, timing, cost of development or operation of the Project without obtaining the written consent of the other Party;

 

(b)           Keeping the Owner advised generally as to developments affecting the status of all Required Approvals, including, without limitation, local zoning, subdivision, environmental,  and other Government Requirements, and update Owner periodically on the status of any other due diligence issues identified by Owner or Ironstate from time to time;

 

(c)           Making recommendations for strategic and tactical actions relating to the development of the Project or the issuance of any Required Approvals;

 

(d)           Participating with the Owner in the negotiation of all necessary agreements with the appropriate municipal authorities and utility companies related to access, traffic, utilities, zoning and other design and construction elements pertaining to the Project and supervise the performance of such agreements after their execution;

 

(e)           Managing the professionals and consultants responsible for compliance with code restrictions, licenses, permits and certificates required for the Project, including without limitation, zoning restrictions and all other Government Requirements affecting the Project;

 

(f)            Coordinating with the Owner and any architects, general contractors, subcontractors and engineers in the design of the Project and preparation of any plans with respect to the Project, including the design of the all on-site and off-site

 

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improvements;

 

(g)           Participating with Owner in the retention of all contractors and professionals that will provide services in connection with the Project;

 

(h)           Coordinating the negotiation, preparation and performance of all design, architectural, professional, project management and construction related contracts with respect to the Project and coordinating the activities of all designated consultants such as traffic, engineering, architectural, surveying and soil testing and monitoring compliance with such contracts;

 

(i)            Reviewing with Owner the plans and specifications for the Project;

 

(j)            Jointly preparing with Owner the General Development Plan, Budgets, Project schedules and Project budgets, monitoring compliance with such plans, schedules and budgets and updating such plans, schedules and budgets as necessary;

 

(k)           If requested by Owner, jointly preparing with Owner the Master Deed and any necessary reciprocal and cross access easement agreements for the Project.

 

(l)            Coordinating the overall administration of the Project with the Owner, design professionals, contractors and other consultants and municipal officials;

 

(m)          Assisting and coordinating with Owner to obtain financing for the Project, including the negotiation of the terms of such financing;

 

(n)           Evaluating and approving all payment requests from professionals, contractors and consultants engaged to provide service in connection with the Project and processing such payment;

 

(o)           Ensuring that all contractors and consultants engaged to provide services in connection with the Project carry proper liability insurance naming Ironstate, Owner and such affiliates of Ironstate and Owner as each may reasonably request as additional named insureds under such policies where appropriate;

 

(p)           Maintaining a central control file of all application materials, plans and all other documents pertaining to the Project, including all design, engineering, construction and any other contracts for the Project;

 

(q)           Providing to the Owner all records and information pertaining to the Project reasonably requested by the Owner;

 

(r)            Periodically, and at other times upon Owner’s reasonable request, meet with Owner to discuss the development of the Project and to provide such other information as Owner may reasonably request; and

 

(s)           Integrating the Project into the Harborside Financial Center and ensuring compliance with the terms, conditions and requirements of that certain Second

 

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Amendment to the Reciprocal Operation and Easement Agreement for the Harborside Financial Center, as the same may be further modified or amended.

 

Section 2.3             Costs and Expenses.

 

(a)           Ironstate shall be responsible for all costs incurred in connection with performing the Development Services, including those costs associated with obtaining the Required Approvals; provided, however, that in the event that the Phase I Closing Conditions, Phase II Closing Conditions and/or the Phase III Closing Conditions, as set forth in Article 7, are met, as applicable for each Phase, Ironstate (or the designated Ironstate Member) shall receive a credit towards the Phase I Capital Contributions, Phase II Capital Contribution and Phase III Capital Contribution, as applicable, for all costs allocable to such Phase which were set forth in the Pre-Development Budget, as may be amended from time to time, and documented to have been incurred by Ironstate and for any other costs incurred by Ironstate with the reasonable approval of Owner, all in accordance with the terms of this Agreement (collectively, the “Ironstate Pre-Development Costs”).

 

(b)           In the event that the closing of any Phase shall not occur solely as a result of the decision by Ironstate to terminate this Agreement pursuant to the provisions of Section 8.5 below as a consequence of an Event of Default on the part of Owner, Owner shall reimburse Ironstate for the Ironstate Pre-Development Costs attributable to the Phase or Phases for which a closing shall not occur.  In addition, in the event of a termination of this Agreement by Owner pursuant to the provisions of Section 8.4(c), (d) or (e) below, Owner shall reimburse Ironstate for those costs, fees and expenses as set forth in Section 8.4(g) and (h).  In all other instances, Ironstate shall not receive a reimbursement of or contribution toward the Ironstate Pre-Development Costs.

 

(c)           Owner shall be responsible for all costs incurred by Owner in connection with establishing the Master Condominium governing each Unit and for certain other costs to be incurred by Owner in connection with the pre-development of the Project; provided, however, that in the event that the Phase I Closing Conditions, Phase II Closing Conditions and/or the Phase III Closing Conditions are met, as applicable for each Phase, Owner (or the designated Owner Member, as the case may be) shall receive a credit towards the its capital account in the applicable Harborside Entity for reasonable documented costs incurred by Owner and allocable to such Phase, which are either set forth on the Pre-Development Budget, as may be amended from time to time, or otherwise reasonably approved by Ironstate, all in accordance with the terms of this Agreement (the “Owner Pre-Development Costs”). In all other instances, Owner shall not receive a reimbursement of or contribution toward the Owner Pre-Development Costs.

 

(d)           Ironstate shall prepare and submit to Owner for its approval separate  budgets for all costs and expenses anticipated to be incurred in connection with the pre-development, operation and construction of each of Phase I, II and III of the Project (for each such phase, the “Pre-Development Budget”, the “Operating Budget” and the “Construction Budget”).   Ironstate shall provide Owner a report on a monthly basis detailing expenses incurred by Ironstate in connection with each Phase of the Project.  Prior to incurring any expense not set forth in any Pre-Development Budget, Operating Budget or Construction Budget, as any of them

 

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may be amended from time to time, Ironstate shall obtain the prior written approval of Owner, which approval shall not be unreasonably withheld.

 

Section 2.4             Authority of Parties.  Nothing contained in this Agreement shall be construed or implied to create a partnership, agency, joint venture, or employment relationship between the Parties and, except as expressly provided in this Agreement, neither Party shall have any authority to bind the other Party.

 

Section 2.5             Use of Mack-Cali Name.  Ironstate may not use the name “Mack-Cali” or any derivation thereof without the prior written consent of Owner.

 

Section 2.6             Use of Ironstate Name.  Owner may not use the name “Ironstate Development” or any derivation thereof without the prior written consent of Ironstate.

 

Section 2.7             Compliance with Laws.  During the term of this Agreement, Ironstate shall promptly notify Owner of any uncorrected material violation of any Required Approval or other Legal Requirement of the Project promptly after Ironstate receives actual knowledge thereof.

 

Section 2.8             Overall Standard of Care.  Ironstate shall at all times act in the best interest of Owner with respect to the Project and shall duly account to Owner, to Owner’s reasonable satisfaction, for all funds expended in connection with the Project.  Except as expressly authorized under this Agreement, or otherwise by Owner, Ironstate shall deal at “arms-length” with all third parties and shall not make any payment to or enter into any arrangement with respect to the Project with, any Affiliate or related party of Ironstate, without Owner’s express written consent.

 

Section 2.9             Owner’s Cooperation.  Owner shall cooperate with Ironstate in all commercially reasonable respects necessary to develop the Project, including signing applications for Required Approvals, providing necessary information about the Property and responding to Ironstate’s requests with reasonable promptness.

 

ARTICLE 3 - COMPENSATION

 

Section 3.1             No Reimbursement.  Except for their respective portions of the Development Fee and as otherwise provided in Section 2.3 and Article 5 of this Agreement, neither Ironstate nor Owner shall be entitled to any fees or reimbursement of expenses for any development services provided in connection with the Project unless otherwise approved by the other Party.

 

Section 3.2             Development Fee.  Subject to the Parties having received the Approved Financing for the development and construction of the Project and that such Approved Financing provides for the payment of the following, in consideration of Ironstate’s and Owner’s obligations under this Agreement, Ironstate and Owner shall split a development fee (the “Development Fee”) equal to three percent (3%) of all “soft & hard construction costs” incurred in connection with the Project, including the costs of obtaining the Required Approvals.  The Development Fee shall be shared equally by Ironstate and Owner.

 

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ARTICLE 4 - REPRESENTATIONS AND WARRANTIES

 

Section 4.1             By Ironstate.  In order to induce Owner to enter into this Agreement, Ironstate hereby represents and warrants to Owner as follows:

 

(a)           Ironstate is a duly organized and validly existing limited liability company under the laws of the State of New Jersey and has all requisite power and authority under the laws of such state and its organizational documents to own its property and assets, to enter into and perform its obligations under this Agreement and to transact the business in which it is engaged or presently proposes to engage.

 

(b)           Ironstate has taken all necessary action to authorize the execution, delivery and performance of this Agreement, and this Agreement constitutes the valid and binding obligation and agreement of Ironstate, enforceable in accordance with its terms (subject to the effect of bankruptcy, insolvency or creditor rights generally and to limitations imposed by general principles of equity).

 

(c)           Neither the execution and delivery of this Agreement, nor compliance with the terms and provisions thereof, will result in any breach of the terms, conditions or provisions of, or conflict with or constitute a default under, or result in the creation of any lien, charge or encumbrance upon any property or assets of Ironstate pursuant to the terms of, any indenture, mortgage, deed of trust, note, evidence of indebtedness, agreement or other instrument to which Ironstate may be party or by which it or any of its properties may be bound, or violate any Legal Requirement.

 

(d)           Except as in each instance previously disclosed to Owner in writing, there are no judgments presently outstanding and unsatisfied against Ironstate or any of its assets or properties and neither Ironstate nor any of its assets or properties is involved in any litigation at law or in equity, or in any proceeding before any court, or by or before any governmental or administrative agency, which judgment, litigation or proceeding could have a material adverse effect on Ironstate or the Project, and no such material judgment, litigation or proceeding is, to the best of Ironstate’s knowledge, threatened against Ironstate or any of its assets or properties, and to the best of Ironstate’s knowledge, no investigation looking toward such a proceeding has begun or is contemplated.

 

(e)           No order, permission, consent, approval, license, authorization, registration or validation of, or filing with, or exemption by, any governmental agency, commission, board or public authority is required to authorize, or is required in connection with the execution, delivery and performance by Ironstate of, this Agreement or the taking of any action hereby contemplated, other than any such order, permission, consent, approval, license, authorization, registration or validation of, or filing with, or exemption by, any governmental agency, commission, board or public authority required for the development of the Project.

 

(f)            Neither Ironstate nor its Affiliates, Key Principals, any officer, director, shareholder, partner, investor or member of Ironstate or its Affiliates is named by any Executive Order of the United States Treasury Department as a terrorist, a “Specially Designated National and Blocked Person,” or any other banned or blocked person, entity, nation or transaction pursuant to any law, order, rule or regulation that is enforced or administered by the Office of Foreign Assets Control (collectively, an “Identified Terrorist”).  Ironstate is not engaging in this transaction on the behalf of, either directly or indirectly, any Identified Terrorist.

 

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Section 4.2             By Owner.  In order to induce Ironstate to enter into this Agreement, Owner hereby represents and warrants to Ironstate as follows:

 

(a)           Owner is duly organized and validly existing limited liability company under the laws of the State of New Jersey and has all requisite power and authority under the laws of such state and its charter documents to own its property and assets, to enter into and perform its obligations under this Agreement and to transact the business in which it is engaged or presently proposes to engage.

 

(b)           Owner has taken all necessary action to authorize the execution, delivery and performance of this Agreement, and this Agreement constitutes the valid and binding obligation and agreement of Owner, enforceable in accordance with its terms (subject, to the effect of bankruptcy, insolvency or creditor’s rights generally and to limitations imposed by general principles of equity).

 

(c)           Neither the execution and delivery of this Agreement, nor compliance with the terms and provisions thereof, will result in any breach of the terms, conditions or provisions of, or conflict with or constitute a default under, or result in the creation of any lien, charge or encumbrance upon any property or assets of the Owner pursuant to the terms of, any indenture, mortgage, deed of trust, note, evidence of indebtedness, agreement or other instrument to which Owner may be party or by which it or they or any of its properties may be bound, or violate any Legal Requirement.

 

(d)           To Owner’s Actual Knowledge, Owner owns fee simple title to the Property, to Owner’s Actual Knowledge subject only to the easements, covenants and restrictions set forth on Exhibit E annexed hereto and made a part hereof (“Permitted Exceptions”).

 

(e)           As of the Effective Date, Owner shall not have entered into any other agreements with any third party or governmental agency to sell or develop the Property nor has Owner entered into any leases or given anyone any rights to use or occupy the Property which would survive development of the Project beyond any of the Phase I, Phase II or Phase III Closing Dates, as applicable, or are not terminable by Owner on reasonable notice.

 

(f)            There is no litigation, claim, or governmental proceeding (including, but not limited to any condemnation proceeding) pending, or to Owner’s Actual Knowledge, threatened, or of which Owner has received written notice, with respect to the Property or the operation or ownership thereof which is not adequately covered by insurance, or with respect to Owner which impairs Owner’s ability to perform its obligations under this Agreement.

 

(g)           Owner has received no written notice from any Governmental Authority of any violation (collectively “Violations”) of any Legal Requirement applicable to the Property (including, without limitation, any Environmental Law), which has not been corrected.  To Owner’s Actual Knowledge, the Property is in compliance with and not in Violation of any Legal Requirement applicable to the Property (including, without limitation, any Environmental Law), which has not been corrected.

 

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(h)           Owner has not received any written notice of added or special assessment of real estate taxes.  The real estate taxes are based upon full assessment and Owner has not received written notice of an increase in the assessed valuation of the Property.

 

(i)            Owner is not a “foreign person” under the Foreign Investment in Real Property Tax Act of 1980 (“FIRPTA”).

 

(j)            During Owner’s ownership of the Property, Owner has not: (i) manufactured, generated, or Discharged any Hazardous Materials in or about the Property or any real estate immediately adjacent to the Property; or (ii) installed, used or removed any fuel storage tanks in or about the Property, and (b) to  Owner’s Actual Knowledge, no third party has Discharged any Hazardous Materials on the Property, in any case in violation of any Environmental Law.

 

(k)           Neither Owner, nor its Affiliates, any officer, director, shareholder (excluding, however, any shareholder of Mack-Cali Realty Corporation), partner, investor or member of Owner or its Affiliates is named by any Executive Order of the United States Treasury Department as a terrorist, a “Specially Designated National and Blocked Person,” or any other banned or blocked person, entity, nation or transaction pursuant to any law, order, rule or regulation that is enforced or administered by the Office of Foreign Assets Control (collectively, an “Identified Terrorist”.)  Owner is not engaging in this transaction on the behalf of, either directly or indirectly, any Identified Terrorist.

 

(l)            At the time of the admittance of Ironstate into them pursuant to the terms of this Agreement, neither Harborside Entity A, nor Harborside Entity B nor Harborside Entity C will have any pre-existing liabilities for which Ironstate will be liable. Owner will indemnify and hold Ironstate harmless from and against any such liabilities.

 

As used herein, “Owner’s Actual Knowledge” shall mean the actual knowledge, without independent confirmation or investigation, of Mitchell E. Hersh and Roger W. Thomas.

 

ARTICLE 5 - CAPITAL CONTRIBUTION

 

Section 5.1             Phase I Capital Contributions.

 

(a)           The Parties agree that for the purposes of the Harborside Entity A Operating Agreement,, Owner’s deemed contribution of Unit 1 shall be valued at thirty ($30) dollars per square foot of buildable floor area, defined as the gross floor area of Unit 1 for development (as set forth in the Required Approvals) minus the number of square feet attributable to all mechanical and garage space associated with Unit 1 (the “Unit 1 Established Value”).  Upon the Parties entering into the Harborside Entity A Operating Agreement, Owner shall be credited with a capital account equal to the aggregate of the Unit 1 Established Value and the Owner Pre-Development Costs allocable to Unit 1 (collectively, the “Unit 1 Owner Capital Value”). The required capital contribution for the Ironstate Member A Interest (the “Phase I Capital Contribution”) shall equal seventeen and point six four seven zero five percent (17.64705%)   of the Unit 1 Owner Capital Value. The required Phase I Capital Contribution shall be reduced as set forth in Section 2.3, on a dollar for dollar basis, by the amount equal to the Ironstate Pre-Development Costs attributable to Unit 1.  For purposes of this calculation, as

 

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well as the Phase I/Unit 2 Capital Contribution, Phase II Capital Contribution and Phase III Capital Contribution calculations set forth in Sections 5.2 and 5.3 below, the costs for ramping work, parking and other parking garage infrastructure costs incurred in connection with the construction of Unit 1, which will benefit other Units or Phases of the Project (collectively, “Site-Wide Parking Improvement Costs”) shall be allocated on a pro-rata basis to each completed Phase and such allocated Site-Wide Parking Improvement Costs shall be reimbursed to Harborside Entity A by Harborside Entity B and Harborside Entity C as each such subsequent Unit and attendant parking structure are completed. For purposes of this calculation, Harborside Entity B’s and Harborside Entity C’s pro-rata share of the Site-Wide Parking Improvement Costs shall be determined by multiplying the Site-Wide Parking Improvement Costs by a fraction, the numerator of which shall be the number of parking spaces contained within the parking garage of Unit 2 or 3, as the case may be, and the denominator of which shall be the total number of parking spaces built, or contemplated to be built by the General Development Plan, for all Phases of the Project.

 

Section 5.2             Phase II Capital Contribution.  The Parties agree that for the purposes of the Harborside Entity B Operating Agreement, Owner’s deemed contribution of Unit 2 shall be valued at thirty ($30) dollars per square foot of buildable area, defined as the gross floor area of Unit 2 approved for development (as set forth in the Required Approvals) minus the number of square feet attributable to all mechanical and garage space associated with Unit 2 (the “Unit 2 Established Value”). Upon the Parties entering into the Harborside Entity B Operating Agreement, Owner shall be credited with a capital account equal to the aggregate of the Unit 2 Established Value and the Owner Pre-Development Costs allocable to Unit 2 (collectively, the “Unit 2 Owner Capital Value”).  The required capital contribution for the Ironstate Member B Interest (the “Phase II Capital Contribution”) shall equal seventeen and point six four seven zero five percent (17.64705%) of the Unit 2 Owner Capital  Value. The Phase II Capital Contribution shall be reduced as set forth in Section 2.3, on a dollar for dollar basis, by the amount equal to the Ironstate Pre-Development Costs attributable to Phase II of the Project.

 

Section 5.3             Phase III Capital Contribution.  The Parties agree that for the purposes of the Harborside Entity C Operating Agreement, Owner’s deemed contribution of  Unit 3 shall be valued at thirty ($30) dollars per square foot of buildable area, defined as the gross floor area of Unit 3 approved for development (as set forth in the Required Approvals) minus the number of square feet attributable to all mechanical and garage space associated with Unit 3 (the “Unit 3 Established Value”). Upon the Parties entering into the Harborside Entity C Operating Agreement, Owner shall be credited with a capital account equal to the aggregate of the Unit 3 Established Value and the Owner Pre-Development Costs allocable to Unit 3 (collectively, the “Unit 3 Owner Capital Value”).  The required capital contribution for the Ironstate Member C Interest (the “Phase III Capital Contribution”) shall equal seventeen and point six four seven zero five percent (17.64705%) of the Unit 3 Owner Capital Value. The Phase III Capital Contribution shall be reduced as set forth in Section 2.3, on a dollar for dollar basis, by the amount equal to the Ironstate Pre-Development Costs attributable to Phase III of the Project.

 

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ARTICLE 6 - CLOSING

 

Section 6.1             Phase I Closing and Admittance of Ironstate Member.

 

(a)           The Parties agree that the Phase I Closing shall occur as promptly as is reasonably practicable following the satisfaction or waiver of all requirements of Section 7.1 of this Agreement, which satisfaction or waiver must occur on or before thirty-six (36) months from the date of this Agreement (the “Phase I Outside Closing Date”).  Notwithstanding the foregoing, the  Phase I Outside Closing Date may be extended as a consequence of an Event of Force Majeure if the Party seeking the extension has undertaken its responsibilities under this Agreement in a diligent, continuous and good faith manner and is not in default under this Agreement. If the Phase I Outside Closing Date is extended as a consequence of an Event of Force Majeure, such extension shall be equal to the length of the delay caused by the Event of Force Majeure but in no event greater than six (6) months from the original Phase I Outside Closing Date. In addition, the Phase I Closing shall happen simultaneously with closing under the Approved Financing/Phase I and the Phase I Outside Closing Date shall be extended as may be reasonably necessary to coincide with the closing of the Approved Financing/Phase I.

 

(b)           At the Phase I Closing, Owner Member A shall admit, or caused to be admitted, Ironstate Member A as a member having an initial 15% interest in Harborside Entity A.  Upon admittance, the Ironstate Phase I Capital Contribution, subject to any applicable credit as provided in Section 2.3 above, shall be tendered by Ironstate Member A as its cash capital contribution to Harborside Entity A.

 

Section 6.2             Owner’s Phase I Closing Deliverables.

 

Section 6.2.1          Phase I Closing Deliverables.  At the Phase I Closing, Owner shall deliver the following:

 

(a)           Master Deed and Title Transfer. Evidence of the satisfaction of the conditions and delivery of the items listed in Section 7.1.1 (a)

 

(b)           Harborside Entity A Operating Agreement.  The Harborside Entity A Operating Agreement executed by Owner Member A.

 

(c)           Closing Certificate.  A closing certificate in such form as the parties may agree, executed by Owner, in which Owner certifies to Ironstate that all representations and warranties made by Owner in Section 4.2 of this Agreement are true and correct in all material respects as of the Phase I Closing Date.

 

(d)           Good Standing Certificates.  Evidence that Harborside Entity A is in good standing in the State of New Jersey.

 

(e)           Member’s Certificate.  A certificate of the Managing Member of Harborside Entity A, attaching true and complete copies of the following:

 

(1)   Certificate of Formation of Harborside Entity A, as in effect on the Phase I Closing Date and certified by the Treasurer of the State of New Jersey.

 

(2)   Harborside Entity A’s operating agreement as in effect on the Phase I Closing Date; and

 

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(3)   A written consent of Owner Member A as the sole member of Harborside Entity A approving the Phase I Fourth Stage Closing.

 

(f)            Membership Interest Certificate. Such Membership Certificate or Membership Certificate Power as may be reasonable and necessary to effectuate and evidence the transfer of the Ironstate Member A Interest to Ironstate Member A , free and clear of all liens and encumbrances.

 

(g)           Title Insurance Policies.  ALTA owner’s policies insured by a title company authorized and licensed to do business in the State of New Jersey, insuring fee simple title to Unit 1, in an amount reasonably acceptable to Owner and Ironstate in an amount not less than the Approved/Financing Phase I, subject only to the Permitted Exceptions and the Master Deed and any other exceptions which do not impair the marketability of title or the Project for its anticipated use.

 

Section 6.3             Ironstate’s Phase I Closing Deliverables.  At the Phase I Closing, Ironstate shall deliver or cause to be delivered the following:

 

(a)           Phase I Capital Contribution.  The Phase I Capital Contribution, to be tendered by Ironstate Member A to Harborside Entity A as set forth in Section 5.1(a) above.

 

(b)           Harborside Entity A Operating Agreement.  The Harborside Entity A Operating Agreement executed by Ironstate Member A.

 

(c)           Closing Certificate.  A closing certificate in such form as the parties may agree, executed by Ironstate, in which Ironstate certifies to Owner that all representations and warranties made by Ironstate in Section 4.1 of this Agreement are true and correct in all material respects as of the Phase I Closing Date.

 

Section 6.4             Phase II Closing and Admittance of Ironstate Member.

 

(a)           The Phase II Closing shall occur as promptly as is reasonably practicable following the satisfaction or waiver of all requirements of Section 7.2 of this Agreement (the “Phase II Closing Date”). The Phase II Closing shall happen simultaneously with closing under the Approved Financing/Phase II and the Phase II Closing Date shall be extended as may be reasonably necessary to coincide with the closing of the Approved Financing/Phase II

 

(b)           At the Phase II Closing, Owner Member B shall transfer, or caused to be transferred, the Ironstate Member B Interest to Ironstate Member B.  Upon transfer, the Ironstate Phase II Capital Contribution, subject to any applicable credit as provided in Section 2.3 above, shall be tendered by Ironstate Member B as its cash capital contribution to Harborside Entity B.

 

Section 6.5             Owner’s Phase II Closing Deliverables.

 

Section 6.5.1          Phase II Closing Deliverables.  At the Phase II Closing, Owner shall deliver or cause to be delivered to Harborside Entity B the following:

 

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(a)           Deed and Title Transfer. Evidence of the satisfaction of the conditions and delivery of the items listed in Section 7.2.1(b).

 

(b)           Harborside Entity B Operating Agreement.  The Harborside Entity B Operating Agreement executed by Owner Member B.

 

(c)           Closing Certificate.  A closing certificate in such form as the parties may agree, executed by Owner, in which Owner certifies to Ironstate that all representations and warranties made by Owner in Section 4.2 of this Agreement are true and correct as of the Phase II Closing Date.

 

(d)           Good Standing.  Evidence that Harborside Entity B is in good standing in the State of New Jersey.

 

(e)           Member’s Certificate.  A certificate of the Managing Member of Harborside Entity B, attaching true and complete copies of the following:

 

(1)   Certificate of Formation of Harborside Entity B, as in effect on the Phase II Closing Date and certified by the Treasurer of the State of New Jersey.

 

(2)   Harborside Entity B’s operating agreement as in effect on the Phase II Closing Date; and

 

(3)   A written consent of Owner Member B, as the sole member of Harborside Entity B approving the Phase II Closing.

 

(f)            Membership Interest Certificate. Such Membership Certificate or Membership Certificate Power as may be reasonable and necessary to effectuate and evidence the transfer of the Ironstate Member B Interest to Ironstate Member B free and clear of all liens and encumbrances.

 

(g)           Title Insurance Policy.  An ALTA owner’s policy insured by a title company authorized and licensed to do business in the State of New Jersey, insuring fee simple title to Unit 3, in an amount reasonably acceptable to Owner and Ironstate (the cost of which shall be an Ironstate Pre-Development Cost), subject only to the Permitted Exceptions and the Master Deed.

 

Section 6.6             Ironstate’s Phase II Closing Deliverables.  At the Phase II Closing, Ironstate shall deliver or cause to be delivered the following:

 

(a)           Phase II Capital Contribution.  The Phase II Capital Contribution, to be tendered by Ironstate Member B to Harborside Entity B as set forth in Section 6.4(b) above.

 

(b)           Harborside Entity B Operating Agreement.  The Harborside Entity B Operating Agreement executed by Ironstate Member B.

 

(c)           Closing Certificate.  A closing certificate in such form as the parties may agree, executed by Ironstate, in which Ironstate certifies to Owner that all

 

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representations and warranties made by Ironstate in Section 4.1 of this Agreement are true and correct as of the Phase II Closing Date.

 

Section 6.7             Phase III Closing and Admittance of Ironstate Member.

 

(a)           The Parties agree that the Phase III Closing shall occur as promptly as is reasonably practicable following the satisfaction or waiver of all requirements of Section 7.3 of this Agreement (the “Phase III Closing Date”). The Phase III Closing shall happen simultaneously with closing under the Approved Financing/Phase III and the Phase III Closing Date shall be extended as may be reasonably necessary to coincide with the closing of the Approved Financing/Phase III

 

(b)           At the Phase III Closing, Owner Member C shall transfer, or caused to be transferred, the Ironstate Member C Interest to Ironstate Member C.  Upon transfer, the Phase III Capital Contribution, subject to any applicable credit as provided in Section 2.3 above, shall be tendered by Ironstate Member C as its cash capital contribution to Harborside Entity C.

 

Section 6.8             Owner’s Phase III Closing Deliverables.

 

Section 6.8.1          Phase III Closing Deliverables.  At the Phase III Closing, Owner shall deliver or cause to be delivered to Harborside Entity C the following:

 

(a)           Deed.and Title Transfer. Evidence of the satisfaction of the conditions and delivery of the items listed in Section 7.3.1(b).

 

(b)           Harborside Entity C Operating Agreement.  The Harborside Entity C Operating Agreement executed by Owner Member C.

 

(c)           Closing Certificate.  A closing certificate in such form as the parties may agree, executed by Owner, in which Owner certifies to Ironstate that all representations and warranties made by Owner in Section 4.2 of this Agreement are true and correct as of the Phase III Closing Date.

 

(d)           Good Standing.  Evidence that Harborside Entity C is in good standing in the State of New Jersey.

 

(e)           Member’s Certificate.  A certificate of the Managing Member of Harborside Entity C, attaching a true and complete copies of the following:

 

(1)   Certificate of Formation of Harborside Entity C, as in effect on the Phase III Closing Date and certified by the Treasurer of the State of New Jersey.

 

(2)   Harborside Entity C’s operating agreement as in effect on the Phase II Closing Date; and

 

(3)   A written consent of the Owner Member C as the sole member of Harborside Entity C approving the Phase III Second Stage Closing.

 

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(f)            Membership Interest Certificate. Such Membership Certificate or Membership Certificate Power as may be reasonable and necessary to effectuate and evidence the transfer of the Ironstate Member C Interest to Ironstate Member C free and clear of all liens and encumbrances.

 

(g)           Title Insurance Policy.  An ALTA owner’s policy insured by a title company authorized and licensed to do business in the State of New Jersey, insuring fee simple title to Unit 3 subject only to the Permitted Exceptions and the Master Deed.

 

Section 6.9             Ironstate’s Phase III Closing Deliverables.  At the Phase III Closing, Ironstate shall deliver or cause to be delivered the following:

 

(a)           Phase III Capital Contribution.  The Phase III Capital Contribution, to be tendered by Ironstate Member C to Harborside Entity C as set forth in Section 6.8(b) above.

 

(b)           Harborside Entity C Operating Agreement.  The Harborside Entity  C Operating Agreement executed by Ironstate Member C.

 

(c)           Closing Certificate.  A closing certificate in such form as the parties may agree, executed by Ironstate, in which Ironstate certifies to Owner that all representations and warranties made by Ironstate in Section 4.1 of this Agreement are true and correct as of the Phase III Closing Date.

 

ARTICLE 7 - CONDITIONS TO CLOSING

 

Section 7.1             Conditions to Phase I Closing.

 

Section 7.1.1          Conditions to Ironstate’s Obligations. Ironstate’s obligation to consummate the Phase I Closing is conditioned on all of the following, any or all of which may be waived by Ironstate by an express written waiver, at its sole option:

 

(a)           Creation of Master Condominium and Recordation of Master Deed.  On or before the Phase I Closing date, Owner shall have formed the Master Condominium by recording a master deed for the Master Condominium (the “Master Deed”), any other formation documents required by the New Jersey Condominium Act, N.J.S. 46:8A-1 et seq. or otherwise necessary to establish the Master Condominium, including any necessary reciprocal and cross access easement agreements between the Units and shall have executed and provided the following:

 

(1)   Unit 1 Deed.  A duly executed and acknowledged Bargain and Sale Deed with Covenants against Acts of Grantor, conveying fee simple title to Unit 1 to Harborside Entity A, in proper statutory form for recording.

 

(2)   Affidavits of Title.  A duly executed and acknowledged, New Jersey Affidavit of Title for Unit 1 in a form reasonably acceptable to the title company insuring title for Unit 1.

 

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(3)   Affidavits of Consideration.  An Affidavit of Consideration of Exemption or Partial Exemption for Unit 1, if applicable.

 

(4)   Resident Seller’s Tax Declarations.  A Resident Seller’s Tax Declaration for Unit 1.

 

(5)   1099 Reporting Forms.  A 1099 Reporting Form for Unit 1.

 

(b)           Representations True.  All representations and warranties made by Owner in this Agreement shall be true and correct in all material respects on and as of the Phase I Closing Date, as if made on and as of such date except to the extent they expressly relate to an earlier date.

 

(c)           Required Approvals.  The Required Approvals for Phase I of the Project shall have been obtained, shall remain in full force and effect as of the Phase I Closing Date and Ironstate shall have received evidence that the Required Approvals have been obtained and remain in full force as of the Phase I Closing Date.

 

(d)           Financing.  The Parties shall have secured the Approved Financing/Phase I and the loan closing for the financing of Phase I of the Project shall occur simultaneously with the Phase I Closing.

 

(e)           Owner’s Deliveries Complete.  Owner shall have performed all other covenants, undertakings and obligations, and complied with all conditions required by this Agreement, to be performed or complied with by Owner at or prior to the Phase I Closing.

 

(f)            Marketable Title. Title to Unit 1 shall be good and marketable free of all liens, mortgages and other encumbrances except the Permitted Exceptions and the Master Deed and any other which do not impair the marketability of title or the Project for its anticipated use.

 

(g)           Owner’s Events of Default.  There shall not exist any continuing Event of Default by Owner under this Agreement.

 

Section 7.1.2          Conditions to Owner’s Obligations: Owner’s obligation to consummate the Phase I Closing is conditioned on all of the following, any or all of which may be expressly waived by Owner in writing, at its sole option:

 

(a)           Representations True.  All representations and warranties made by Ironstate in this Agreement shall be true and correct in all material respects on and as of the Phase I Closing Date, as if made on and as of such date except to the extent they expressly relate to an earlier date.

 

(b)           Required Approvals.  The Required Approvals for Phase I of the Project shall have been obtained, shall remain in full force and effect as of the Phase I Closing Date and Owner shall have received evidence that the Required Approvals have been obtained and remain in full force as of the Phase I Closing Date..

 

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(c)           Financing.  The Parties shall have secured the Approved Financing/Phase I and the loan closing for the financing of Phase I of the Project shall occur simultaneously with the Phase I Closing.

 

(d)           Ironstate’s Deliveries Complete.  Ironstate shall have performed all other covenants, undertakings and obligations, and complied with all conditions required by this Agreement, to be performed or complied with by Ironstate at or prior to the Phase I Closing.

 

(e)           Ironstate Events of Default.  There shall exist no continuing Events of Default by Ironstate under this Agreement.

 

Section 7.2             Conditions to Phase II Closing.

 

Section 7.2.1          Conditions to Ironstate’s Obligations: Ironstate’s obligation to consummate the Phase II Closing is conditioned on all of the following, any or all of which may be waived by Ironstate by an express written waiver, at its sole option:

 

(a)           The Phase I Closing shall have occurred.

 

(b)           On or before the Phase II Closing Date, Owner shall have executed and provided the following:

 

(1)   Unit 2 Deed.  A duly executed and acknowledged Bargain and Sale Deed with Covenants against Acts of Grantor, conveying fee simple title to Unit 2 to Harborside Entity B, in proper statutory form for recording.

 

(2)   Affidavits of Title.  A duly executed and acknowledged, New Jersey Affidavit of Title for Unit 2 in a form reasonably acceptable to the title company insuring title for Unit 2.

 

(3)   Affidavits of Consideration.  An Affidavit of Consideration of Exemption or Partial Exemption for Unit 2, if applicable.

 

(4)   Resident Seller’s Tax Declarations.  A Resident Seller’s Tax Declaration for Unit 2.

 

(5)   1099 Reporting Forms.  A 1099 Reporting Form for Unit 2.

 

(c)           Required Approvals.  The Required Approvals for Phase II of the Project shall have been obtained, shall remain in full force and effect as of the Phase II Closing Date and Ironstate shall have received evidence that the Required Approvals have been obtained and remain in full force as of the Phase II Closing Date.

 

(d)           Owner’s Deliveries Complete.  Owner shall have performed all other covenants, undertakings and obligations, and complied with all conditions required by this Agreement, to be performed or complied with by Owner at or prior to the Phase II Closing.

 

(e)           Financing.  The Parties shall have secured the Approved Financing/Phase II for the development and construction of Phase II of the Project and the loan

 

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closing for the financing of Phase II of the Project shall occur simultaneously with the Phase II Closing.

 

(f)            Representations True.  All representations and warranties made by Owner in this Agreement shall be true and correct in all material respects on and as of the Phase II Closing Date, as if made on and as of such date except to the extent they expressly relate to an earlier date.

 

(g)           Marketable Title. Title to Lot 2 shall be good and marketable free of all liens, mortgages and other encumbrances except the Permitted Exceptions and the Master Deed and those permitted exceptions which do not impair the marketability of title or the Project for its intended use.

 

(h)           Owner’s Events of Default.  There shall exist no continuing Event of Default by Owner under either this Agreement or the Harborside Entity A Operating Agreement.

 

Section 7.2.2          Conditions to Owner’s Obligations. Owner’s obligation to consummate the Phase II Closing is conditioned on all of the following, any or all of which may be expressly waived by Owner in writing, at its sole option:

 

(a)           Representations True.  All representations and warranties made by Ironstate in this Agreement shall be true and correct in all material respects on and as of the Phase II Closing Date, as if made on and as of such date except to the extent they expressly relate to an earlier date.

 

(b)           Required Approvals.  The Required Approvals for Phase II of the Project shall have been obtained, shall remain in full force and effect as of the Phase II Closing Date and Owner shall have received evidence that the Required Approvals have been obtained and remain in full force as of the Phase II Closing Date.

 

(c)           Financing.  The Parties shall have secured the Approved Financing/Phase II and the loan closing for the financing of Phase II of the Project shall occur simultaneously with the Phase II Closing.

 

(d)           Ironstate’s Deliveries Complete.  Ironstate shall have performed all other covenants, undertakings and obligations, and complied with all conditions required by this Agreement, to be performed or complied with by Ironstate at or prior to the Phase II Closing.

 

(e)           Ironstate Event of Default.  There shall be no continuing Event of Default by Ironstate under this Agreement or the Harborside Entity A Operating Agreement.

 

Section 7.3             Conditions to Phase III Closing.

 

Section 7.3.1          Conditions to Ironstate’s Obligations: Ironstate’s obligation to consummate the Phase III Closing is conditioned on all of the following, any or all of which may be waived by Ironstate by an express written waiver, at its sole option:

 

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(a)           The Phase I and Phase II Closings shall have occurred.

 

(b)           On or before the Phase III Closing Date, Owner shall have executed and provided the following:

 

(1)   Unit 3 Deed.  A duly executed and acknowledged Bargain and Sale Deed with Covenants against Acts of Grantor, conveying fee simple title to Unit 3 to Harborside Entity C, in proper statutory form for recording.

 

(2)   Affidavits of Title.  A duly executed and acknowledged, New Jersey Affidavit of Title for Unit 3 in a form reasonably acceptable to the title company insuring title for Unit 3.

 

(3)   Affidavits of Consideration.  An Affidavit of Consideration of Exemption or Partial Exemption for Unit 3, if applicable.

 

(4)   Resident Seller’s Tax Declarations.  A Resident Seller’s Tax Declaration for Unit 3.

 

(5)   1099 Reporting Forms.  A 1099 Reporting Form for Unit 3.

 

(c)           Representations True.  All representations and warranties made by Owner in this Agreement shall be true and correct in all material respects on and as of the Phase III Closing Date, as if made on and as of such date except to the extent they expressly relate to an earlier date.

 

(d)           Required Approvals.  The Required Approvals for Phase III of the Project shall have been obtained, shall remain in full force and effect as of the Phase III Closing Date and Ironstate shall have received evidence that the Required Approvals have been obtained and remain in full force as of the Phase III Closing Date.

 

(e)           Financing.  The Parties shall have secured the Approved Financing/Phase III and the loan closing for the financing of Phase III of the Project shall occur simultaneously with the Phase III Closing.

 

(f)            Owner’s Deliveries Complete.  Owner shall have performed all other covenants, undertakings and obligations, and complied with all conditions required by this Agreement, to be performed or complied with by Owner at or prior to the Phase III Closing.

 

(g)           Marketable Title. Title to Lot 3 shall be good and marketable free of all liens, mortgages and other encumbrances except the Permitted Exceptions, the Master Deed and any other exceptions which do not impair the marketability of title or the Project for its intended use.

 

(h)           Owner’s Events of Default.  There shall exist no continuing Event of Default by Owner under either this Agreement or any of the Harborside Entity A or Harborside Entity B Operating Agreements.

 

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Section 7.3.2          Conditions to Owner’s Obligations. Owner’s obligation to consummate the Phase III Closing is conditioned on all of the following, any or all of which may be expressly waived by Owner in writing, at its sole option:

 

(a)           Representations True.  All representations and warranties made by Ironstate in this Agreement shall be true and correct in all material respects on and as of the Phase III Closing Date, as if made on and as of such date except to the extent they expressly relate to an earlier date.

 

(b)           Required Approvals.  The Required Approvals for Phase III of the Project shall have been obtained, shall remain in full force and effect as of the Phase III Closing Date and Owner shall have received evidence that the Required Approvals have been obtained and remain in full force as of the Phase III Closing Date.

 

(c)           Financing.  The Parties shall have secured the Approved Financing/Phase III and the loan closing for the financing of Phase III of the Project shall occur simultaneously with the Phase III Closing.

 

(d)           Ironstate’s Deliveries Complete.  Ironstate shall have performed all other covenants, undertakings and obligations, and complied with all conditions required by this Agreement, to be performed or complied with by Ironstate at or prior to the Phase III Closing.

 

(e)           Ironstate Event of Default.  There shall be no continuing Event of Default by Ironstate under this Agreement or either of the Harborside Entity A, or Harborside Entity B Operating Agreements.

 

ARTICLE 8 - TERM, DEFAULT; TERMINATION

 

Section 8.1             Term.  The term of this Agreement shall commence on the date hereof and shall end on the date that the Project has been completed, unless sooner terminated pursuant to the terms of this Agreement.

 

Section 8.2             Ironstate Events of Default.  The occurrence of any of the following events shall constitute an event of default (“Event of Default”) hereunder on the part of Ironstate:

 

(a)           should Ironstate, Ironstate Member A, Ironstate Member B, or Ironstate Member C (collectively, the “Ironstate Parties” and individually, an “Ironstate Party”) institute proceedings of any nature under the Federal Bankruptcy Code, or any similar state or federal law for the relief of debtors, wherein any Ironstate Party is seeking relief as debtor or should there occur a general assignment by any Ironstate Party for the benefit of creditors or should any Ironstate Party admit in writing that it is unable to pay its debts as they mature;

 

(b)           should there be instituted against any Ironstate Party a proceeding under any section or chapter of the Federal Bankruptcy Code, or any similar federal or state law for the relief of debtors, which proceeding is not dismissed, stayed or discharged within a period of ninety (90) days after the filing thereof or if stayed, which stay is thereafter lifted without a contemporaneous discharge or dismissal of such proceedings;

 

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(c)           should there be an attachment, execution or other judicial seizure of (i) all or any substantial part of the assets of any Ironstate Party or (ii) an Ironstate Party’s interest under this Agreement, such attachment, execution or seizure remaining undismissed or undischarged for a period of 30 days after levy thereof;

 

(d)           should any fraud or willful misconduct be perpetrated by any Ironstate Party or, with the knowledge of the Ironstate Party, any representation, warranty or statement made by or on behalf of such Ironstate Party to Owner be untrue in any material respect on the date as of which made;

 

(e)           should there occur, by reason of any consolidation or merger or otherwise, either (i) a dissolution or termination of the legal existence of an Ironstate Party or cessation of business by an Ironstate Party for any reason whatsoever, except in connection with a transfer of such Ironstate Party’s obligations under this Agreement to an Affiliate of Ironstate reasonably satisfactory to Owner or (ii) a violation by or on behalf of any Ironstate Party of any of the restrictions on transfer or assignment set forth in Section 11.1 of this Agreement;

 

(f)            should there occur a default in performance of, or failure to comply with, any material agreements, obligations or undertakings herein contained, which default or failure continues for 30 days (or 10 days if such default or failure is due solely to the nonpayment of money) following notice thereof given by the Owner; provided that in the case of any non-monetary material default or failure that cannot be cured within 30 days through the exercise of reasonable diligence, so long as Ironstate commences such cure within 30 days, such default or failure remains susceptible to cure, and Ironstate diligently pursues such cure to completion, such default or failure shall not be deemed to create an Event of Default hereunder provided such cure is completed on or before 90 days from the original date of notice of such default or failure;

 

(g)           should there occur an event of default beyond any applicable cure period by any Affiliate of Ironstate of any material obligation under any agreement with or for the benefit of Owner or an Owner Party or with respect to the Project: or

 

(h)           should there occur and Event of Default by Ironstate or should Ironstate be removed for cause as the Managing Member under any of the Harborside Entity A, Harborside Entity B or Harborside Entity C Operating Agreements.

 

Section 8.3             Owner Remedies on Ironstate Default.  Upon the occurrence and during the continuance of any Event of Default, the Owner shall be exclusively entitled to do any or all of the following:  (a) cause the termination of this Agreement in accordance with Section 8.4 below and (b) exercise each and every other right or remedy available with respect to such Event of Default under this Agreement or at law or in equity.

 

Section 8.4             Early Termination.  This Agreement shall be subject to early termination by Owner upon the happening of any of the following terms and conditions:

 

(a)           Upon notice to Ironstate, at any time after the occurrence and during the continuance of any Event of Default; or

 

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(b)           An Event of Dissolution under either of the Harborside Entity A or Harborside Entity B Operating Agreements; or

 

(c)           The denial of any Required Approval for any Phase of the Project after the exhaustion of all appeal rights as may be exercised by any Party; or

 

(d)           In respect of Phase I:

 

(1)   Failure to achieve the Phase I Closing by the Phase I Outside Closing Date, as the same may be extended as a result of an Event of Force Majeure; or

 

(2)   Subject to the terms and conditions of this Section 8.4, if and only if all of the Phase I Closing Conditions shall have been satisfied or waived other than the securing of the Approved Financing/Phase I, the determination by Owner, in Owner’s reasonable discretion, that the development of Phase I of the Project is not economically viable or will not generate the returns previously anticipated; or

 

(e)           Subject to the terms and conditions of this Section 8.4, the determination by Owner, in Owner’s reasonable discretion, (i) that market conditions do not support the development of Phase II or Phase III of the Project or (ii) the development of Phase II or Phase III of the Project would not otherwise be economically viable; or

 

(f)            The discharge of Ironstate for cause for its willful violation of any material term or condition of this Agreement.  For purposes of this Agreement, the term “cause” means any reason materially and adversely affecting the best interests of the Project or such as to make it unreasonable to expect Owner to continue to permit Ironstate to continue as the party providing development services for the Project.  Additionally, discharge of Ironstate for cause under this Agreement shall also be a termination for cause of Ironstate as the Managing Member under each of the Operating Agreements.

 

(g)           If Owner shall have exercised its early termination rights pursuant to Section 8.4(c) or (d) above, despite the commercially reasonably and diligent efforts of Ironstate, then:

 

(1)   Ironstate shall be reimbursed for fifty (50%) percent of the Ironstate Pre-Development Costs, except as provided in the following subsection;

 

(2)   Ironstate shall be reimbursed for eighty-five (85%) percent of any sewer connection fees and similar assessment theretofore paid arising out of or in connection with the Project.

 

(h)           If Owner shall have exercised its early termination rights pursuant to Section 8.4(e) above, then Ironstate shall be reimbursed one hundred (100%) of the Ironstate Pre-Development Costs attributable to Phase II or Phase III of the Project.

 

(i)            Owner’s rights under Section 8.4(d)(2) above shall be deemed suspended if Ironstate shall deliver to Owner within sixty (60) days of Owner’s election to exercise the rights under such Section 8.4(d)(2) a term sheet from a nationally recognized

 

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commercial bank or other financial institution/lender that regularly makes loans of a similar nature for financing for Phase I of the Project on a commercially reasonable basis.  A financing shall be deemed “commercially reasonable” for purposes of Section 8.4(d)(2) above notwithstanding that the financing in such term sheet may provide for:

 

(1)   Construction completion guaranties and customary non-recourse carve-outs and indemnities of ordinary operating expenses, interest and taxes, which guaranties and indemnities are to be provided by Ironstate and Owner, or their creditworthy Affiliates, as contemplated by Section 3.4 of the Harborside Entity A Operating Agreement;

 

(2)   Syndication by the commercial bank or other lender of participations with other lenders in the loan; and

 

(3)   Any such financing shall provide for either: (i) a principal loan amount of not less than sixty percent (60%) of the total anticipated cost to construct Phase I as detailed on the Construction Budget, including the Unit 1 Established Value, with no guaranty of the principal amount of the loan other than as contemplated by clause (1) above, or (ii) a principal loan amount of not less than seventy percent (70%) of the total anticipated cost to construct Phase I as detailed on the Construction Budget, including the Unit 1 Established Value, with a guaranty of principal repayment of the loan in an amount of not more than ten percent (10%) of the total anticipated cost to construct Phase I as detailed on the Construction Budget, including the Unit 1 Established Value, to be provided by Ironstate and Owner, or their creditworthy Affiliates, as contemplated by Section 3.4 of the Harborside Entity A Operating Agreement.

 

(j)            If any such proposed bank loan financing shall have expired without advancing any loan proceeds or otherwise without a closing, any such suspension of Owner’s rights under Section 8.4(d)(2) above shall terminate, and this Agreement shall then immediately become subject to Owner’s early termination rights under Section 8.4(d)(2) above.

 

Section 8.5             Default by Owner.  There shall be deemed an Event of Default by Owner hereunder should there occur a material default by Owner in the performance of, or failure to comply with, any agreements, obligations or undertakings herein contained, which default or failure continues for 30 days (or 10 days if such default or failure is due solely to the nonpayment of money) following notice thereof given by Ironstate; provided that in the case of any non-monetary material default or failure that cannot be cured within 30 days through the exercise of reasonable diligence, so long as Owner commences such cure within 30 days, such default or failure remains susceptible to cure, and Owner diligently pursues such cure to completion, such default or failure shall not be deemed to create an Event of Default hereunder provided such cure is completed on or before 90 days from the original date of notice of such default or failure.

 

Section 8.6             Ironstate Remedies Upon Owner Default.  Upon the occurrence and during the continuance of any Event of Default by Owner, Ironstate shall be entitled to do any or all of the following: (a) cause the termination of this Agreement and (b) with respect to such Event of Default under this Agreement, due to the difficulty of proving damages in a court of law in the Event of Default by Owner and as its sole and exclusive remedy, the parties have agreed that as liquidated damages Ironstate shall be entitled to an amount equivalent to fifteen (15%)

 

24

 

percent of the Established Unit Value of the Unit subject to Owner’s default.  Such amount shall be deemed a reasonable estimate of the likely losses from any such Event of Default in light of the difficulty of ascertaining the actual damages.  Such amount shall be deemed a reasonable amount and not a forfeiture or penalty.

 

Section 8.7             Use of the Property upon Termination.  Upon the termination of this Agreement, Owner shall retain all of its rights, title and interest in and to any portion of the Property that has not been developed pursuant to the terms of this Agreement, including any Phases that have not closed pursuant to Article 6 of this Agreement.  Following the termination of this Agreement, Owner shall be free to develop the remaining undeveloped Phases on its own for such use as it may determine, including but not limited to, non-residential uses.

 

ARTICLE 9 - CONDEMNATION AND RISK OF LOSS

 

Section 9.1             Condemnation.  If, prior to the Phase I Closing, Phase II Closing or Phase III Closing, as applicable, any Unit (or any part thereof) shall be condemned or shall be made the subject of a condemnation proceeding or shall be damaged by reason of public or quasi-public improvements (any such condemnation, condemnation proceeding or damage resulting from public improvements being hereinafter referred to as a “Condemnation”), then Owner shall promptly notify Ironstate in writing of the Condemnation.  If the Condemnation affects twenty-five (25%) percent or more of the Unit, then Owner shall elect, within thirty (30) days of receipt of the notice of Condemnation, to either:  (i) terminate such aspects of this Agreement as relate to the Phase or Phases affected by the Condemnation or (ii) with the express written consent of Ironstate, continue this Agreement as if no such Condemnation had occurred.  In either case, Ironstate shall have no right to share in any Condemnation award, but should Owner elect to terminate pursuant to clause (i) above, Owner shall reimburse Ironstate for the Ironstate Pre-Development Costs for the Phase or Phases which are subject to such termination.

 

Section 9.2             Risk of Loss.  The risk of loss in and to each Unit shall remain vested in Owner until such Unit has been transferred pursuant to Article 6 of this Agreement.

 

ARTICLE 10 - NON-COMPETITION

 

Section 10.1           During the Non-Compete Period, neither Ironstate nor any of its Affiliates shall, directly or indirectly, alone or as a partner, joint venturer, officer, director, member, employee, consultant, agent, independent contractor or holder of an equity interest of, or lender to, any Person or business, engage in any real-estate development residential business except as a passive limited partner on a parcel that is located within Jersey City Territory other than in Ironstate’s or any of its Affiliates capacity as developer and manager of the Project.

 

Section 10.2           Nothing in this Article 10 shall be deemed to restrict Ironstate’s involvement in any project as a passive limited partner or in any venture that is the subject of binding agreements on or before September 15, 2011.  A list of such projects (collectively, the “Ironstate Permitted Projects”) is attached to this Agreement as Exhibit F.

 

Section 10.3           Because the Owner does not have an adequate remedy at law to protect the Owner’s business from any breach of Ironstate’s obligations in this Article 10, Owner shall be entitled to preliminary and permanent injunctive relief, in addition to such other remedies and relief that would, in such event, be available to Owner.

 

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ARTICLE 11 - MISCELLANEOUS

 

Section 11.1           Assignment.  No Party may assign this Agreement or transfer any interest therein without the prior written consent of the other Parties.  An assignment or transfer as a result of a merger to which Owner or Owner’s parent is a party or a sale of all or substantially all of the assets of Owner or Owner’s parent shall not be deemed an assignment or transfer prohibited by this Section 11.1.

 

Section 11.2           Confidentiality.  The Parties shall hold in strict confidence the terms of this Agreement and information contained in this Agreement (the “Confidential Information”) and shall not disclose any Confidential Information to any third party.  Notwithstanding anything to the contrary hereinabove set forth, the Parties may disclose such Confidential Information (i) as necessary to each Party’s attorneys, accountants and other consultants involved in the transactions contemplated by this Agreement; provided, however, such attorneys, accountants and consultants shall be bound by this confidentiality requirements of this Section 11.2,  (ii) as any governmental agency or stock exchange may require in order to comply with applicable laws, rules and requirements, including, without limitation, Legal Requirements, or a court order;  (iii) to the extent that such information is a matter of public record; and (iv) as otherwise advisable upon advice of counsel. Notwithstanding the foregoing, Owner shall be entitled to discuss with investors, analysts, and others, and to issue press releases, advertisements and other promotional materials in connection with Owner’s and Owner’s Affiliates’ promotional and marketing activities, describing the Project in general terms or in detail and Owner’s participation in the Project. The provisions of this Section 10.2 shall survive termination of this Agreement.

 

Section 11.3           Notices.

 

(a)           Any and all notices, demands, consents, approvals, offers, elections, reports and other communications required or permitted under this Agreement (collectively, “Notices” or, individually, a “Notice”) shall be deemed adequately given if in writing and the same shall be delivered either in hand, by telecopier with written acknowledgment of receipt, or by mail or Federal Express or similar expedited commercial carrier, addressed to the recipient of the notice, postpaid and registered or certified with return receipt requested (if by mail), or with all freight charges prepaid (if by Federal Express or similar carrier).

 

(b)           All Notices required or permitted to be sent hereunder shall be deemed to have been given for all purposes of this Agreement upon the date of acknowledged receipt, in the case of a Notice by telecopier, and, in all other cases, upon the date of receipt or refusal, except that whenever under this Agreement a Notice is either received on a day which is not a Business Day or is required to be delivered on or before a specific day which is not a Business Day, the day of receipt or required delivery shall automatically be extended to the next Business Day.

 

(c)           All such Notices shall be addressed:

 

If to Owner to:                                                                                                                                                                   Mitchell E. Hersh, President and

Chief Executive Officer

 

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Mack-Cali Realty Corporation

343 Thornall Street

Edison, New Jersey 08837

Telecopier:            732-205-9040

 

with a copy to:                                                                                                                                                                 Roger W. Thomas, Executive Vice

President and General Counsel

Mack-Cali Realty Corporation

343 Thornall Street

Edison, New Jersey 08837

Telecopier:            732-205-9015

 

If to Ironstate, to:                                                                                                                                                   David Barry, President

Ironstate Development Company, LLC

50 Washington Street

Hoboken, New Jersey 07030

Telecopier:            201 963 5020

 

with a copy to:                                                                                                                                                                 Barbara Oif Stack

General Counsel

The Applied Companies

50 Washington Street

Hoboken, NJ 07030

Telecopier: 201 963 5020

 

(d)           By Notice given as herein provided, the parties hereto and their respective successors and assigns shall have the right from time to time and at any time during the term of this Agreement to change their respective addresses effective upon receipt by the other parties of such notice and each shall have the right to specify as its address any other address within the United States of America.

 

Section 11.4           Successors and Assigns.  Whenever in this Agreement any of the Parties hereto is referred to, such reference shall be deemed to include the successors and permitted assigns of such party and all covenants and agreements which are contained in this Agreement shall be binding upon and inure to the benefit of the respective successors and permitted assigns of the Parties hereto.

 

Section 11.5           Severability.  In case any one or more of the provisions contained in this Agreement should be invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby, but this Agreement shall be reformed and construed and enforced to the maximum extent permitted by applicable law.

 

Section 11.6           Entire Contract.  This Agreement, and other agreements referenced herein constitute the entire agreement between the Parties hereto with respect to development of the Project and shall supersede and take the place of any other instruments purporting to be an agreement of the Parties hereto relating to the same; provided, however, that in the event of any

 

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conflict between the provisions of this Agreement and the provisions of any of the Operating Agreements, the provisions of the applicable Operating Agreement shall prevail.

 

Section 11.7           Exhibits.  The Exhibits referred to in this Agreement are deemed to be annexed to this Agreement and made a part hereof as though set forth in the body of the Agreement.

 

Section 11.8           Headings; Interpretation; Counterparts.   Headings in this Agreement are for purposes of reference only and shall not limit or otherwise affect the meaning hereof.  All nouns, pronouns and verbs used in this Agreement shall be construed as masculine, feminine, neuter, singular, or plural, whichever shall be applicable.  Words such as “hereof,” “herein,” “hereinafter,” and the like refer to this Agreement as a whole and not to the section, paragraph or other part in which they appear, unless the context otherwise requires.  All schedules and exhibits to this Agreement are incorporated herein by reference and made a part hereof.  This Agreement may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument, and in pleading or proving any provision of this Agreement, it shall not be necessary to produce more than one of such counterparts.

 

Section 11.9           Applicable Law.  This Agreement and all other documents and instruments executed and delivered to evidence, complete, or perfect the transactions contemplated hereby and thereby will be interpreted, construed, applied and enforced in accordance with the laws of the state of New Jersey

 

Section 11.10         Choice of Forum.  Any action to enforce, arising out of, or relating in any way to, any of the provisions of this Agreement may be brought and prosecuted in such court or courts located in the state where the Project is located as is provided by law; and the parties consent to the jurisdiction of said court or courts and to service of process by registered mail, return receipt requested, or by any other manner provided by law.

 

Section 11.11         Tax Consequences.  The Parties agree to reasonably cooperate and structure the transactions set forth herein to achieve the most favorable tax treatment allowable by applicable law.

 

[SIGNATURE PAGE FOLLOWS]

 

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EXECUTED as a sealed instrument as of the day and year above first written.

 

 

	
 
    	
OWNER:
    
	
 
    	
 
    
	
 
    	
M-C   PLAZA VI & VII L.L.C.
    
	
 
    	
By:   Mack-Cali Realty, L.P., sole member
    
	
 
    	
 
    	
By:
    	
Mack-Cali   Realty Corporation, general partner
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/   Mitchell E. Hersh
    
	
 
    	
 
    	
 
    	
Mitchell E. Hersh,
    
	
 
    	
 
    	
 
    	
President and Chief Executive Officer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
IRONSTATE:
    
	
 
    	
 
    
	
 
    	
IRONSTATE   DEVELOPMENT, LLC
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ 
    	
David   Barry
    
	
 
    	
Name:
    	
David   Barry
    
	
 
    	
Title:
    	
Managing   Member
    
					

 

29

 

EXHIBIT A

 

THE PROPERTY

 

Deed description of a parcel of land situate near the northerly side of Christopher Columbus Drive in the City of Jersey City, Hudson County, New Jersey

 

Beginning at the most southeasterly corner of the hereinafter described parcel, said point being the following two (2) Courses for the point of intersection of the existing northerly side of Christopher Columbus Drive (80’ wide) with the easterly side of Washington Street (80’ wide) and running: thence

 

A             Easterly along a curve to the left having a radius of 3960.00 feet, an arc length of 682.14 feet (chord which bears S 74° 06’ 49” E 681.30 feet) to a point on curve; thence

 

B.            N 08° 09’ 07” E 679.01 feet to the point of beginning and running; thence

 

1.             N 81° 50’ 53” W 229.62 feet to a point; thence

 

2.             N 08° 18’ 49” E 278.56 feet along the easterly side of proposed Greene Street to a point of curvature; thence

 

3.             Along a curve to the left having a radius of 364.00 feet, an arc length of 262.93 feet (chord which bears N 12° 22’ 47” W 257.25 feet) along the easterly side of proposed Greene Street to a point of tangency; thence

 

4.             N 33° 04’ 23” W 68.35 feet along the easterly side of proposed Greene Street to a point; thence

 

5.             S 83° 00’ 00” E 145.13 feet to a point on curve; thence

 

6.             Southerly along a curve to the right having a radius of 762.00 feet, an arc length of 1.71 feet (chord which bears S 01° 33’ 00” E 1.71 feet) to a point on curve; thence

 

7.             S 71° 15’ 59” E 259.84 feet to a point on the westerly side of Hudson Street; thence

 

8.             S 16° 52’ 32~ W 226.79 feet partially along the westerly side of Hudson Street to a point of curvature; thence

 

9.             Along a curve to the left having a radius of 200.00 feet, an arc length of 30.45 feet (chord which bears S 12° 30’ 50” W 30.42 feet) to a point tangency; thence

 

10.           S 08° 09’ 07” W 269.91 feet to the point of Beginning.

 

FOR INFORMATION PURPOSES ONLY:

 

Premises described herein is designated as Lot 22, Block 10 on the Tax Map of City of Jersey City, Hudson County, New Jersey.

 

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EXHIBIT B

 

DEFINITIONS

 

“Affiliate” means, with respect to any Person (i) any Person directly or indirectly controlling, controlled by or under common control with such Person, (ii) any officer, director, manager or trustee of such Person or (iii) any Person who is an officer, director, manager or trustee of any Person described in clause (i) of this sentence.  For purposes of this definition, the terms “controlling,” “controlled by” or “under common control with” shall mean the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person or entity, whether through the ownership of voting securities, by contract or otherwise, or the power to elect at least fifty (50%) of the directors, managers or persons exercising similar authority with respect to such Person or entities.

 

“Agreement” has the meaning ascribed to it on Page 1 of the Agreement.

 

“Approved Financing/Phase I” has the meaning ascribed to it in Section 1.2.1 of the Agreement.

 

“Approved Financing/Phase II” has the meaning ascribed to it in Section 1.2.2 of the Agreement.

 

“Approved Financing/Phase III” has the meaning ascribed to it in Section 1.2.3 of the Agreement.

 

“Condemnation” has the meaning ascribed to it in Section 9.1 of the Agreement.

 

“Confidential Information” has the meaning ascribed to it in Section 11.2 of the Agreement.

 

“Construction Budget” has the meaning ascribed to it in Section 2.3(iv) of the Agreement.

 

“Development Fee” has the meaning ascribed to it in Section 3.2 of the Agreement.

 

“Development Services” has the meaning ascribed to it in Section 2.2 of the Agreement.

 

“Environmental Law” means, collectively, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended (42 U.S.C. Sections 6901, et seq.), the Resources Conservation and Recovery Act of 1976 (42 U.S.C. Section 6901, et seq.), the Clean Water Act (33 U.S.C. Section 1251, et seq.), the Safe Drinking Water Act (14 U.S.C. Section 1401, et seq.), the Hazardous Materials Transportation Act (49 U.S.C. Section 1801, et seq.), the Toxic Substance Control Act (15 U.S.C. Section 2601, et seq.), the Spill Compensation and Control Act (N.J.S.A. 58:10-23.11 et seq.), the Site Remediation Reform Act (N.J.S.A. 58:10C-1, et seq.) (“SRRA”); the Solid Waste Management Act (N.J.S.A. 13:1H-1, et seq.); the Brownfield and Contaminated Site Remediation Act (N.J.S.A. 58:10B-1 et seq.); and the New Jersey Water Pollution Control Act (N.J.S.A. 58:10A-1 et seq.), as said laws have been supplemented or amended from time to time, the regulations now or hereafter promulgated pursuant to said laws, and any other federal, state, county or local law, statute, rule, standard, regulation or ordinance currently in effect or subsequently enacted, promulgated or adopted which regulates land use or prescribes the use, storage, disposal, presence, cleanup, transportation, release or threatened release into the environment of Hazardous Materials.

 

31

 

“Event of Default” has the meaning ascribed to it in Section 8.2 of the Agreement.

 

“Event of Force Majeure” means, any event or circumstance beyond the reasonable control of any Party, or an Affiliate of any Party hereto, including the following; any acts of God, fire, volcano, earthquake, hurricane, blizzard, infectious disease, technological disaster, catastrophe, large scale infestation of any type, tremors, flood, explosion, release of nuclear radiation, release of biotoxic or of biochemical agent(s), the elements, war, blockade, riots, mob violence or civil disturbance, any act or acts of terrorism, an inability to procure goods or services or a general shortage of labor, equipment, facilities, energy, materials or supplies in the open market, failure of transportation, strikes, walkouts, actions of labor unions, governmentally imposed moratoriums or court orders changes in law, regulation or interpretation, condemnation, takings or any other action by which a governmental authority, the failure of any lender to fund the financing contemplated by any Approved Financing for any of Phases I, II or III, any action instituted by any Person(other than any Party to this Agreement or any Affiliate thereof) contesting any Required Approval, any Approved Financing for any of Phases I, II or III or generally the development of the Project.  Performance under this Agreement shall be excused by an Event of Force Majeure for the length of the delay caused by the Event of Force Majeure, but in no event beyond a period of six (6) months from such Event of Force Majeure and in no event six (6) months beyond any Outside Closing Date, at which time, either party may terminate this Agreement in accordance with Section 8.4.

 

“FIRPTA” has the meaning ascribed to it in Section 4.2(h) of the Agreement.

 

“General Development Plan” has the meaning ascribed to it in Section 1.3 of the Agreement.

 

“Governmental Authority” means: (i) the United States of America; (ii) any state, commonwealth, territory or possession of the United States of America and any political subdivision thereof (including counties, municipalities and the like); (iii) any foreign (as to the United States of America) sovereign entity and any political subdivision thereof; or (iv) any agency, authority or instrumentality of any of the foregoing, including any court, tribunal, department, bureau, commission or board.

 

“Harborside Entity A” has the meaning ascribed to it Section 1.2.1of the Agreement.

 

“Harborside Entity A Operating Agreement” has the meaning ascribed to it Section 1.2.1(b) of the Agreement.

 

“Harborside Entity B” has the meaning ascribed to it Section 1.2.1 of the Agreement.

 

“Harborside Entity B Operating Agreement” has the meaning ascribed to it Section 1.2.1(d) of the Agreement.

 

“Harborside Entity C” has the meaning ascribed to it Section 1.2.2(a) of the Agreement.

 

“Harborside Entity C Operating Agreement” has the meaning ascribed to it Section 1.2.2(c) of the Agreement.

 

32

 

“Hazardous Materials” shall mean inflammable explosives, radioactive materials, asbestos, asbestos—containing materials, polychlorinated biphenyls, lead, lead-based paint, radon, under and/or above ground tanks, hazardous materials, hazardous wastes, hazardous substances, oil, or related materials, which are listed or regulated in any Environmental Law.

 

“Ironstate” has the meaning ascribed to it on Page 1 of the Agreement.

 

“Ironstate Member A” has the meaning ascribed to it in Section 1.2.1(a) of the Agreement.

 

“Ironstate Member A Interest” has the meaning ascribed to it in Section 1.2.1(a) of the Agreement.

 

“Ironstate Member B” has the meaning ascribed to it in Section 1.2.1(c) of the Agreement.

 

“Ironstate Member B Interest” has the meaning ascribed to it in Section 1.2.1(c) of the Agreement.

 

“Ironstate Member C” has the meaning ascribed to it in Section 1.2.2(b) of the Agreement.

 

“Ironstate Member C Interest” has the meaning ascribed to it in Section 1.2.2(b) of the Agreement.

 

“Ironstate Permitted Projects” has the meaning ascribed to it in Section 10.2 of the Agreement.

 

“Ironstate Pre-Development Costs” has the meaning ascribed to it in Section 2.3 of the Agreement.

 

“Jersey City Territory” means the area bounded on the east by the Hudson River, on the south by Essex Street, on the west by Grove Street and on the north by 14th Street, in Jersey City, New Jersey.

 

“Key Principals” means David Barry and Michael Barry.

 

“Legal Requirement” means any statute, ordinance, law, rule, regulation, code, plan, injunction, judgment, order, decree, ruling, charge or other requirement, standard or procedure enacted, adopted or applied by any Governmental Authority, including judicial decisions applying common law or interpreting any other Legal Requirement.

 

“Major Decisions” has the meaning ascribed to it in Section 2.1 of the Agreement and as further defined on Exhibit D hereto.

 

“Master Condominium” has the meaning ascribed to it in Section 1.1 of the Agreement.

 

“Master Deed” has the meaning ascribed to it in Section 6.1(a) of the Agreement.

 

“Non-Compete Period” means the period beginning with the date of mutual execution and delivery of this Agreement and ending on the three (3) year anniversary date of the completion of the Project.

 

33

 

“Notice” and “Notices” each has the respective meaning ascribed it in Section 10.3(a) of the Agreement.

 

“Operating Agreements” means, collectively, the Harborside Entity A Operating Agreement, the Harborside Entity B Operating Agreement and the Harborside Entity C Operating Agreement.

 

“Operating Budget” has the meaning ascribed to it in Section 2.3(iv) of the Agreement.

 

“Owner” has the meaning ascribed to it on Page 1 of the Agreement.

 

“Owner Member A” has the meaning ascribed to it Section 1.2.1 of the Agreement.

 

“Owner Member B” has the meaning ascribed to it Section 1.2.2 of the Agreement.

 

“Owner Member C” has the meaning ascribed to it Section 1.2.3(a) of the Agreement.

 

“Party” and “Parties” each has the respective meaning ascribed to it in the first paragraph of this Agreement.

 

“Person” means and includes any individual, corporation, partnership, association, limited liability company, trust, estate, or other entity.

 

“Phase” and “Phases” each has the respective meaning ascribed to it in Section 1.1 of the Agreement.

 

“Phase I” has the meaning ascribed to it in Section 1.2.1 of the Agreement.

 

“Phase I Capital Contributions” has the meaning ascribed to it in Section 5.1(b) of the Agreement.

 

“Phase I Closing Conditions” means the conditions to the Phase I Closing set forth in Section 7.1 of the Agreement.

 

“Phase I Closing” has the meaning ascribed to it in Section 6.1 of the Agreement.

 

“Phase I Closing Deliverables” has the meaning ascribed to it in Section 6.2 of the Agreement.

 

“Phase I Capital Contribution” has the meaning ascribed to it in Section 5.1 of the Agreement.

 

“Phase II” has the meaning ascribed to it in Section 1.2.2 of the Agreement.

 

“Phase II Capital Contribution” has the meaning ascribed to it in Section 5.2 of the Agreement.

 

“Phase II Closing Conditions” means the conditions to the Phase II Closing set forth in Section 7.2 of the Agreement.

 

“Phase II Closing” has the meaning ascribed to it in Section 6.4 of the Agreement.

 

34

 

“Phase II Closing Deliverables” has the meaning ascribed to it in Section 6.5 of the Agreement.

 

“Phase III” has the meaning ascribed to it in Section 1.2.3 of the Agreement.

 

“Phase III Capital Contribution” has the meaning ascribed to it in Section 5.3 of the Agreement.

 

“Phase III Closing Conditions” means the conditions to the Phase III Closing set forth in Section 7.3 of the Agreement.

 

“Phase III Closing” has the meaning ascribed to it in Section 6.7 of the Agreement.

 

“Phase III Closing Deliverables” has the meaning ascribed to it in Section 6.8.1 of the Agreement.

 

“Pre-Development Budget” has the meaning ascribed to it in Section 2.3(iv) of the Agreement.

 

“Project” has the meaning ascribed to it Section 1.1 of the Agreement.

 

“Property” has the meaning ascribed to it in the Recitals to the Agreement.

 

“Required Approvals” has the meaning ascribed to it in Section 2.2(a) of the Agreement.

 

“Site-Wide Parking Improvement Costs has the meaning ascribed to it in Section 5.1 of the Agreement.

 

“Unit” has the meaning ascribed to it Section 1.1 of the Agreement.

 

“Unit 1” has the meaning ascribed to it Section 1.2.1 of the Agreement.

 

“Unit 1 Established Value” has the meaning scribed to it in Section 5.1 of the Agreement.

 

“Unit 2” has the meaning ascribed to it Section 1.2.2 of the Agreement.

 

“Unit 2 Established Value” has the meaning ascribed to it in Section 5.2 of the Agreement.

 

“Unit 3” has the meaning ascribed to it Section 1.2.2 of the Agreement.

 

“Unit 3 Established Value” has the meaning scribed to it in Section 5.3 of the Agreement.

 

“Violations” has the meaning ascribed to it in Section 4.2(f) of the Agreement.

 

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EXHIBIT C

 

FORM OF OPERATING AGREEMENT

 

36

 

EXHIBIT D

 

MAJOR DECISIONS

 

The following Major Decisions with respect to the Project shall require the unanimous consent of Ironstate and Owner:

 

1.       The approval of pre-development, operating and construction budgets for the Project, including the General Development Plan.

 

2.       Any amendment of any pre-development budget by which the increase to any line item within the budget exceeds the greater of (i) 5% of the original amount of such line item, and (ii) $25,000, or which would cause the aggregate of all changes to the budget to equal or exceed $100,000, provided, however, that reallocation of funds from one line item to another line item shall not constitute a Major Decision.

 

3.       Any amendment of any construction budget by which the increase to any line item within the budget exceeds the greater of (i) 2% of the original amount of such line item, and (ii) $100,000, or which would cause the aggregate of all changes to the budget to equal or exceed $250,000.

 

4.       Any amendment of any operating budget by which the increase to any line item within the budget exceeds the greater of (i) 5% of the original amount of such line item, and (ii) $25,000, or which would cause the aggregate of all changes to the budget to equal or exceed $100,000 provided, however, that reallocation of funds from one line item to another line item shall not constitute a Major Decision..

 

5.       Any material amendment to any approved phasing, development or construction schedules.

 

6.       Any material amendment to any approved site plan or other approvals.

 

7.       The decision to obtain financing for the Project, including the terms of any such financing.

 

8.       The grant of any mortgage, lien or encumbrance on the Property.

 

9.       The sale or transfer of all or any part of the Property or any actions relating to any casualty or eminent domain proceedings affecting the Property.

 

10.     Entering into, terminating or amending any contracts in connection with any aspect of the Project in excess of $100,000.

 

11.     The admission of a new member to Harborside Entity A, Harborside Entity B, Harborside Entity C.  The entry of any joint venture or partnership with any Person not a Party to this Agreement.

 

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12.     Capital calls, other than (a) those consistent with pre-development, construction and operating budgets adopted by Ironstate and Owner or (b) those for non-discretionary expenses, such as real estate taxes, insurance premiums and expenses required to comply with Government Requirements.

 

13.     The development of leasing guidelines for the Project and any material deviation from such guidelines.

 

14.     Any commercial lease involving more than 5,000 square feet of space.

 

15.     Any amendment to any Operating Agreement.

 

16.     Any environmental matter relating to the Property, including selection of environmental consultants and adoption of and implementation of any operation and maintenance program or any other program to remove or otherwise remediate hazardous materials or wastes.

 

17.     Taking any legal action, except and to the extent the same is not prohibited by any provision of any loan affecting any portion of the Project: (i) initiating action to collect rentals and other amounts payable to the Company under leases and other occupancy agreements affecting any Unit or to dispossess any occupant who is in default in its obligations to the Company and defending against tenant claims, (ii) defending liability claims for which the insurance is maintained insurance, (iii) contesting or protesting any ad valorem tax or assessment, or (iv) initiating, defending or settling claims in which the amount in controversy does not exceed $25,000.00.

 

18.     The voluntary commencement or proceeding under the United States Bankruptcy Code or under any state or foreign bankruptcy, insolvency or similar statute affecting any Party, or a subsidiary of any Party, or the liquidation, dissolution, merger, consolidation, sale or other disposition of all or substantially all the assets of any Party, or a subsidiary of any Party, or the marshaling of assets and liabilities; receivership, insolvency, assignment for the benefit of creditors, reorganization, arrangement, composition with creditors or readjustment of debts; or other similar events or proceedings affecting any Party, or a subsidiary of any Party, or any allegation or contest of the validity of this Agreement in any such proceeding.

 

19.     Regarding any matter that would be undertaken by any of Harborside Entity A, Harborside Entity B or Harborside Entity C that is not within the ordinary course of business or within the business purpose of, any of the Harborside Entity A, Harborside Entity B or Harborside Entity C, as applicable.

 

20.     The Procurement of any policy of insurance for any Phase of the Project.

 

38

 

EXHIBIT E

 

PERMITTED EXCEPTIONS

 

39

 

EXHIBIT F

 

IRONSTATE PERMITTED PROJECTS

 

1.          70, 80 and 90 Columbus Drive (Block 138 Lot T Condo Area 3)

 

2.          Blocks 5.1 and 5.2 as shown on the Liberty Harbor North Redevelopment Plan

 

3.          Block 11 as shown on the Liberty Harbor North Redevelopment Plan

 

40

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