Document:

Exhibit 10.7

 

MEMBER INTEREST PURCHASE AND SALE AGREEMENT

 

 

BETWEEN

 

 

iSTAR CTL HOLDCO LLC,

AS SELLER

 

 

AND

 

 

TRT ACQUISITIONS LLC,

AS PURCHASER

 

 

DATED:  JUNE 25, 2010

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
  Page No.

  
	
   

  	
   

  	
   

  
	
  ARTICLE 1 BASIC INFORMATION

  	
  1

  
	
  1.1

  	
  Certain Basic Terms

  	
  1

  
	
  1.2

  	
  Closing Costs

  	
  6

  
	
  1.3

  	
  Notice Addresses

  	
  7

  
	
  ARTICLE 2 MEMBERSHIP INTERESTS

  	
  8

  
	
  2.1

  	
  Membership Interests

  	
  8

  
	
  ARTICLE 3 EARNEST MONEY

  	
  8

  
	
  ARTICLE 4 DUE DILIGENCE

  	
  8

  
	
  4.1

  	
  Due Diligence Materials To Be Delivered

  	
  8

  
	
  4.2

  	
  Physical Due Diligence

  	
  10

  
	
  4.3

  	
  Due Diligence/Financing Contingency Termination Rights

  	
  11

  
	
  4.4

  	
  Updated Property Information

  	
  11

  
	
  4.5

  	
  Return of Documents and Reports

  	
  12

  
	
  4.6

  	
  Service Contracts

  	
  12

  
	
  4.7

  	
  Proprietary Information; Confidentiality

  	
  12

  
	
  4.8

  	
  No Representation or Warranty by Seller

  	
  13

  
	
  4.9

  	
  Purchaser’s Responsibilities

  	
  13

  
	
  4.10

  	
  Purchaser’s Agreement to Indemnify

  	
  13

  
	
  ARTICLE 5 TITLE AND SURVEY

  	
  14

  
	
  5.1

  	
  Title Commitment

  	
  14

  
	
  5.2

  	
  Updated Survey

  	
  14

  
	
  5.3

  	
  Title Review

  	
  14

  
	
  5.4

  	
  Delivery of Title Policy and Non-Imputation Endorsement at
  Closing

  	
  14

  
	
  ARTICLE 6 OPERATIONS AND RISK OF
  LOSS

  	
  15

  
	
  6.1

  	
  Ongoing Operations

  	
  15

  
	
  6.2

  	
  Casualty

  	
  17

  
	
  6.3

  	
  Condemnation

  	
  17

  
	
  6.4

  	
  Tenant Estoppel Certificate/SNDA

  	
  18

  
	
  ARTICLE 7 CLOSING

  	
  19

  
	
  7.1

  	
  Closing

  	
  19

  
	
  7.2

  	
  Conditions to Parties’ Obligation to Close

  	
  19

  
	
  7.3

  	
  Seller’s Deliveries in Escrow

  	
  23

  
	
  7.4

  	
  Purchaser’s Deliveries in Escrow

  	
  24

  
	
  7.5

  	
  Closing Statements

  	
  25

  
	
  7.6

  	
  Purchase Price

  	
  25

  
	
  7.7

  	
  Possession

  	
  25

  
	
  7.8

  	
  Delivery of Books and Records

  	
  25

  
	
  7.9

  	
  Notice to Unisys

  	
  25

  
	
  ARTICLE 8 PRORATIONS, DEPOSITS,
  COMMISSIONS

  	
  26

  
	
  8.1

  	
  Prorations for Taxes

  	
  26

  

 

i

 

	
  8.2

  	
  Prorations for Tenant-Paid Operating Expenses

  	
  26

  
	
  8.3

  	
  Prorations for Non-Tenant Paid Items

  	
  26

  
	
  8.4

  	
  Miscellaneous Prorations

  	
  28

  
	
  8.5

  	
  Leasing Costs

  	
  28

  
	
  8.6

  	
  Closing Costs

  	
  29

  
	
  8.7

  	
  Final Adjustment After Closing

  	
  29

  
	
  8.8

  	
  Tenant Deposits

  	
  29

  
	
  8.9

  	
  Commissions

  	
  29

  
	
  8.10

  	
  Accounts

  	
  30

  
	
  8.11

  	
  Tax Appeals

  	
  30

  
	
  ARTICLE 9 REPRESENTATIONS AND
  WARRANTIES

  	
  30

  
	
  9.1

  	
  Seller’s Representations and Warranties

  	
  30

  
	
  9.2

  	
  Purchaser’s Representations and Warranties

  	
  34

  
	
  9.3

  	
  Survival of Representations and Warranties

  	
  36

  
	
  9.4

  	
  Company Representations.

  	
  37

  
	
  ARTICLE 10 DEFAULT AND REMEDIES

  	
  37

  
	
  10.1

  	
  Seller’s Remedies

  	
  37

  
	
  10.2

  	
  Purchaser’s Remedies

  	
  38

  
	
  10.3

  	
  Attorneys’ Fees

  	
  39

  
	
  10.4

  	
  Other Expenses

  	
  39

  
	
  ARTICLE 11 DISCLAIMERS, RELEASE
  AND INDEMNITY

  	
  39

  
	
  11.1

  	
  Disclaimers By Seller

  	
  39

  
	
  11.2

  	
  Sale “As Is, Where Is”

  	
  40

  
	
  11.3

  	
  Seller Released from Liability

  	
  40

  
	
  11.4

  	
  “Hazardous Materials” Defined

  	
  41

  
	
  11.5

  	
  Intentionally Deleted

  	
  41

  
	
  11.6

  	
  Survival

  	
  41

  
	
  ARTICLE 12 MISCELLANEOUS

  	
  41

  
	
  12.1

  	
  Parties Bound; Assignment

  	
  41

  
	
  12.2

  	
  Headings

  	
  42

  
	
  12.3

  	
  Invalidity and Waiver

  	
  42

  
	
  12.4

  	
  Governing Law

  	
  42

  
	
  12.5

  	
  Survival

  	
  42

  
	
  12.6

  	
  Entirety and Amendments

  	
  43

  
	
  12.7

  	
  Time

  	
  43

  
	
  12.8

  	
  Intentionally Omitted

  	
  43

  
	
  12.9

  	
  No Electronic Transactions

  	
  43

  
	
  12.10

  	
  Notices

  	
  43

  
	
  12.11

  	
  Construction

  	
  43

  
	
  12.12

  	
  Calculation of Time Periods; Business Day

  	
  43

  
	
  12.13

  	
  Execution in Counterparts

  	
  44

  
	
  12.14

  	
  Recordation

  	
  44

  
	
  12.15

  	
  Further Assurances

  	
  44

  
	
  12.16

  	
  Discharge of Obligations

  	
  44

  
	
  12.17

  	
  ERISA

  	
  44

  

 

ii

 

	
  12.18

  	
  No Third Party Beneficiary

  	
  45

  
	
  12.19

  	
  Reporting Person

  	
  45

  
	
  12.20

  	
  Post-Closing Access

  	
  45

  
	
  12.21

  	
  Waiver of Jury Trial

  	
  45

  
	
  12.22

  	
  Information and Audit Cooperation

  	
  45

  
	
  12.23

  	
  Bulk Sales Laws

  	
  46

  

 

iii

 

LIST OF DEFINED TERMS

 

	
   

  	
  Page No.

  
	
   

  	
   

  
	
  Acquired Interests

  	
  5

  
	
  Acquired Properties

  	
  6

  
	
  Agreement

  	
  1

  
	
  Assignment and Assumption

  	
  22

  
	
  Balance Sheets

  	
  33

  
	
  Books and Records

  	
  5

  
	
  Business Day

  	
  43

  
	
  Casualty

  	
  17

  
	
  Casualty Tenant Termination Event

  	
  17

  
	
  Casualty Tenant Termination Notice

  	
  17

  
	
  CERCLA

  	
  40

  
	
  CEVA Properties

  	
  19

  
	
  Closing

  	
  18

  
	
  Closing Date

  	
  2

  
	
  Code

  	
  34

  
	
  Code Plan

  	
  34

  
	
  Co-Insurance

  	
  14

  
	
  Company Representations

  	
  37

  
	
  Condemnation

  	
  17

  
	
  Condemnation Tenant Termination
  Event

  	
  17

  
	
  Condemnation Tenant Termination
  Notice

  	
  17

  
	
  Confidentiality Agreement

  	
  2

  
	
  Effective Date

  	
  2

  
	
  ERISA

  	
  34

  
	
  ERISA Plan

  	
  34

  
	
  Escrow Agent

  	
  2

  
	
  Extended Coverage

  	
  5

  
	
  Fidelity

  	
  14

  
	
  Financial Advisor

  	
  2

  
	
  Financial Statements

  	
  9

  
	
  First American

  	
  14

  
	
  Goodyear Properties

  	
  19

  
	
  Guaranties

  	
  3

  
	
  Guaranty

  	
  3

  
	
  Harborside

  	
  5

  
	
  Harborside Membership Interests

  	
  5

  
	
  Harborside Purchase and Sale Agreement

  	
  5

  
	
  Harborside Seller

  	
  5

  
	
  Hazardous Materials

  	
  40

  
	
  Improvements

  	
  3

  
	
  Indemnitor

  	
  37

  
	
  Intangible Personal Property

  	
  4

  
	
  iPortal

  	
  8

  

 

iv

 

	
  iStar

  	
  2

  
	
  Land

  	
  3

  
	
  Lease

  	
  3

  
	
  Lease Event

  	
  15

  
	
  Lease Files

  	
  9

  
	
  Leases

  	
  3

  
	
  Leasing Costs

  	
  27

  
	
  License Agreements

  	
  5

  
	
  Membership Interests

  	
  5

  
	
  NG LP

  	
  2

  
	
  NG Partnership Interests

  	
  3

  
	
  NG Partnership Interests Purchase and Sale Agreement

  	
  5

  
	
  Non-Imputation Endorsement

  	
  15

  
	
  OFAC

  	
  31

  
	
  Operating Expenses

  	
  25

  
	
  Operating Statements

  	
  8

  
	
  Other Purchase and Sale Agreements

  	
  1, 6

  
	
  Other Real Property

  	
  5

  
	
  Other Sellers

  	
  5

  
	
  Permitted Exceptions

  	
  14

  
	
  Permitted Liabilities

  	
  33

  
	
  Plan Assets

  	
  34

  
	
  Portfolio Property

  	
  3

  
	
  Portfolio Purchase and Sale Agreement

  	
  3

  
	
  Portfolio Seller

  	
  3

  
	
  Pre-Closing Tax Appeals

  	
  29

  
	
  Property

  	
  3

  
	
  Property Documents

  	
  8

  
	
  Property Information

  	
  8

  
	
  Purchase Price

  	
  1

  
	
  Purchaser

  	
  1

  
	
  Real Property

  	
  3

  
	
  Rent Roll

  	
  8

  
	
  Reports

  	
  11

  
	
  Seller

  	
  1

  
	
  Seller’s Ownership Period

  	
  5

  
	
  Seller’s Representatives

  	
  35

  
	
  Service Contracts

  	
  4

  
	
  Similar Law

  	
  44

  
	
  SNDA

  	
  18

  
	
  Subsidiary

  	
  3

  
	
  Subsidiary Agreement

  	
  3

  
	
  Survey

  	
  9

  
	
  Survival Period

  	
  35

  
	
  Tangible Personal Property

  	
  4

  
	
  Taxes

  	
  25

  

 

v

 

	
  Tenant Estoppel Certificate

  	
  18

  
	
  Tenant Receivables

  	
  26

  
	
  Termination

  	
  22

  
	
  Third Party Estoppel Certificate

  	
  18

  
	
  Title Affidavits

  	
  22

  
	
  Title Commitment

  	
  14

  
	
  Title Company

  	
  1

  
	
  Title Policy

  	
  15

  
	
  Unbilled Tenant Receivables

  	
  26

  
	
  Uncollected Delinquent Tenant Receivables

  	
  26

  
	
  Unisys

  	
  5

  
	
  Updated Property Information

  	
  11

  

 

vi

 

MEMBER INTEREST PURCHASE AND SALE AGREEMENT

 

This
Member Interest Purchase and Sale Agreement (this “Agreement”)
is made and entered into by and between Purchaser and Seller.

 

RECITALS

 

A.            Defined terms are indicated
by initial capital letters.  Defined terms
shall have the meanings set forth herein, whether or not such terms are used
before or after the definitions are set forth.

 

B.            Purchaser desires to
purchase the Membership Interests and Seller desires to sell the Membership
Interests, all upon the terms and conditions set forth in this Agreement.

 

NOW,
THEREFORE, in consideration of the mutual terms, provisions, covenants and
agreements set forth herein, as well as the sums to be paid by Purchaser to
Seller, and for other good and valuable consideration, the receipt and
sufficiency of which are acknowledged, Purchaser and Seller agree as follows:

 

ARTICLE 1

BASIC
INFORMATION

 

1.1           Certain Basic Terms.  The following defined terms shall have the
meanings set forth below:

 

1.1.1        “Seller”:          iStar
CTL Holdco LLC, a Delaware limited liability company.

 

1.1.2        “Purchaser”:        TRT
Acquisitions LLC, a Delaware limited liability company.

 

1.1.3        “Purchase Price”: $31,400,000.00; subject to
adjustment as provided herein.  It is
acknowledged and agreed by Purchaser and Seller that the Purchase Price of the
Membership Interests is only for purposes of tax reporting and calculation,
accounting and allocation. In no event shall the Purchase Price of the
Membership Interests be deemed or construed to reflect the sales price of the
Membership Interests or the Property in a stand alone transaction.

 

1.1.4        “Other Purchase and Sale Agreements”:  collectively, the Portfolio Purchase and Sale
Agreement, the NG Partnership Interests Purchase and Sale Agreement and the
Harborside Purchase and Sale Agreement.

 

1.1.5        “Title Company”:

 

First
American Title Insurance Company

National
Commercial Services — Chicago

30
North LaSalle Street, Suite 2700

Chicago,
Illinois 60602

 

 

Attn:  John E. Beckstedt, Jr.

Telephone
number:  (312) 917-7223

Facsimile
number:  (888) 279-8547

E-mail:  jbeckstedt@firstam.com

 

And

 

Fidelity
Title Insurance Company

8450
E. Crescent Parkway, Suite 410

Greenwood
Village, CO 80111

Attn:  Ms. Valena Bloomquist

Telephone
number:  (303) 244-9198

Facsimile
number:  (720) 489-7593

E-mail:  valena.bloomquist@fnf.com

 

1.1.6          “Escrow Agent”:

 

First
American Title Insurance Company

National
Commercial Services — Chicago

30
North LaSalle Street, Suite 2700

Attn:  John E. Beckstedt, Jr. 

Telephone
number:  (312) 917-7223

Facsimile
number:  (888) 279-8547

E-mail:  jbeckstedt@firstam.com

 

1.1.7        “Financial Advisor”:  HFF Securities L.P., an affiliate of Holliday
Fenoglio Fowler, LP.

 

1.1.8        “Effective Date”:  The date on which this Agreement is executed
by the latter to sign of Purchaser or Seller, as indicated on the signature
page of this Agreement.  If the execution
date is left blank by either Purchaser or Seller, the Effective Date shall be
the execution date inserted by the other party.

 

1.1.9        Intentionally Deleted.

 

1.1.10      Intentionally
Deleted.

 

1.1.11      “Closing Date”:  June 29, 2010, or such earlier date as may be
agreed to in writing by Purchaser and Seller.

 

1.1.12      “Confidentiality Agreement”:  The letter agreement dated March 31, 2010
between iStar Financial Inc., an affiliate of Seller (“iStar”), and Purchaser.

 

1.1.13      “NG LP”: 
iStar NG LP, a Delaware limited partnership.

 

1.1.14      Intentionally
Deleted.

 

1.1.15      Intentionally
Deleted.

 

2

 

1.1.16      “Subsidiary”: iStar CTL Sunset Hills —
Reston LLC, a Delaware limited liability company, in each case, to the extent
applicable.

 

1.1.17      “NG Partnership Interests” one hundred
percent (100%) of the partnership interests in NG LP.

 

1.1.18      “Portfolio Purchase and Sale Agreement”:  That certain Purchase and Sale Agreement
between Purchaser and certain sellers a party thereto (individually or
collectively as the context requires, “Portfolio
Seller”), dated as of May 3, 2010, as amended by that certain First
Amendment to Purchase and Sale Agreement, dated as of May 11, 2010, as further
amended by that certain Second Amendment to Purchase and Sale Agreement, dated
as of May 21, 2010, as further amended by that certain Third Amendment to
Purchase and Sale Agreement, dated as of June 24, 2010 and as further amended
by that certain Fourth Amendment to Purchase and Sale Agreement dated as of the
date hereof.

 

1.1.19      “Portfolio Property”:  Those certain properties described in the
Portfolio Purchase and Sale Agreement.

 

1.1.20      “Subsidiary
Agreement”: that certain Limited
Liability Company Agreement of the Subsidiary dated April 28, 2008, and any
amendments thereto.

 

1.1.21      “Property”: 
collectively, the following property:

 

(1)           Real Property. The land
described in Exhibit A hereto (the “Land”),
together with (a) all improvements located thereon, including, without
limitation, that certain office building, but expressly excluding improvements
and structures owned by any tenant or other third party pursuant to the Leases
(the “Improvements”), (b) all right,
title and interest of the Subsidiary, if any, in and to the rights, benefits,
privileges, easements, tenements, hereditaments, and appurtenances thereon or
in anywise appertaining thereto, including without limitation, any and all
minerals and mineral rights, oil, gas, and oil and gas rights, development
rights, air rights, water and water rights, wells, well rights and well
permits, water and sewer taps, and sanitary or storm sewer capacity, and (c)
all right, title, and interest of the Subsidiary, if any, in and to all strips
and gores and any land lying in the bed of any street, road or alley, open or
proposed, adjoining the Land (the Land, together with items (a), (b) and (c) of
this Section 1.1.21(1), collectively, the “Real
Property”).

 

(2)           Leases and Guaranties.
All of the Subsidiary’s right, title and interest, without warranty except as
set forth herein, in those existing leases and subleases, including any
amendments to such leases and subleases made by the Subsidiary, described on Schedule 1.1.21(2) and all leases or
subleases which may be made by the Subsidiary after the Effective Date and
prior to Closing as permitted by this Agreement (individually a “Lease” and collectively the “Leases”), all guaranties of such Leases,
including any amendments to such guaranties, described on Schedule 1.1.21(2) (individually a “Guaranty” and 

 

3

 

collectively
the “Guaranties”), and all other
collateral securing the Leases or Guaranties, including without limitation all
security deposits and letters of credit.

 

(3)           Tangible Personal Property.  All of the Subsidiary’s right, title and
interest, without warranty, except as set forth herein, in the equipment,
machinery, furniture, furnishings, supplies and other tangible personal
property, if any, owned by the Subsidiary and now or hereafter located in and
used in connection with the operation, ownership or management of the Real
Property, but specifically excluding any items of personal property owned or
leased by any tenants at or on the Real Property and further excluding any
items of personal property owned by third parties and leased to the Subsidiary
(collectively, the “Tangible Personal
Property”), which excluded items of personal property are listed on Schedule 1.1.21(3).

 

(4)           Intangible Personal Property.  All of the Subsidiary’s right, title and
interest, if any, without warranty, except as set forth herein, in all
intangible personal property related to the Real Property and the Improvements,
including, without limitation:  all trade
names and trade marks associated with the Real Property and the Improvements,
including the Subsidiary’s rights and interests, if any, in the name of the
Real Property; the plans and specifications and other architectural and engineering
drawings for the Improvements, if any; contract rights related to the
operation, ownership or management of the Real Property, including maintenance,
service, construction, supply and equipment rental contracts, if any, but not
including Leases or License Agreements (collectively, the “Service Contracts”); warranties;
governmental permits, approvals and licenses, if any; and telephone exchange
numbers (all of the items described in this Section 1.1.21(4) collectively
referred to as the “Intangible Personal
Property”). Tangible Personal Property and Intangible Personal
Property shall not include (a) any appraisals or other economic evaluations of,
or projections with respect to, all or any portion of the Property, including,
without limitation, budgets prepared by or on behalf of Seller and the
Subsidiary or any affiliate of Seller or the Subsidiary, (b) any documents,
materials or information which are subject to attorney/client, work product or
similar privilege, which constitute attorney communications with respect to the
Property, Seller and/or the Subsidiary, or which are subject to a
confidentiality agreement, (c) such documents, materials or information
received by Seller or the Subsidiary from tenants and covered by
confidentiality agreements between such tenants and Seller or the Subsidiary,
except that such documents, materials or information shall be included in
Tangible Personal Property if Purchaser shall have agreed in writing to be
bound by the terms of such confidentiality agreements prior to Seller’s
delivery of such documents, materials and information to Purchaser, and (d) any
trade name, mark or other identifying material that includes the name “iStar”
or any derivative thereof.

 

(5)           License Agreements.
All of the Subsidiary’s right, title and interest, without warranty, except as
set forth herein, in and to all agreements (other than the Leases and the
Guaranties), if any, for the leasing or licensing of 

 

4

 

rooftop
space or equipment, cable access and other space, telecommunications equipment,
equipment and facilities that are located on or within the Real Property and
generate income  to the Subsidiary as the
owner of the Real Property, including agreements which may be made by the Subsidiary
after the Effective Date and prior to Closing as permitted by this Agreement
(the “License Agreements”).

 

1.1.22      “Books and Records”:  collectively, all books and records
maintained by Seller and the Subsidiary in connection with the ownership or operation
of the Property or with respect to corporate matters of the Subsidiary.

 

1.1.23      “Extended Coverage”: means the deletion of
exceptions 2, 3, 4 and 5 from Schedule B — Section 2 of the Title Commitment.

 

1.1.24      “Seller’s Ownership Period”: The period
beginning on December 4, 2003 and continuing through the Closing Date.

 

1.1.25      “Harborside Purchase and Sale Agreement”:  That certain Member Interest Purchase and
Sale Agreement between Purchaser and iStar Harborside LLC, a Delaware limited
liability company (“Harborside Seller”),
dated as of May 3, 2010, as amended by that certain First Amendment to Member
Interest Purchase and Sale Agreement, dated as of May 11, 2010, as further
amended by that certain Second Amendment to Member Interest Purchase and Sale
Agreement, dated as of May 21, 2010, as further amended by that certain Third
Amendment to Member Interest Purchase and Sale Agreement, dated as of June 24,
2010 and as further amended by that certain Fourth Amendment to Member Interest
Purchase and Sale Agreement dated as of the date hereof.

 

1.1.26      “Harborside”:  The property commonly known as Harborside
Financial Center Plaza X, Jersey City, New Jersey.

 

1.1.27      “Harborside Membership Interests”:  The one hundred percent (100%) membership
interests in American Financial Exchange L.L.C. owned by Harborside Seller.

 

1.1.28      “Unisys”: 
Unisys Corporation.

 

1.1.29      “NG Partnership Interests Purchase and Sale Agreement”:
That certain Partnership Interests Purchase and Sale Agreement between
Purchaser and NG Partnership Interests Seller, dated as of the date hereof
relating to the purchase and sale of the NG Partnership Interests.

 

1.1.30      “Membership Interests”: One hundred percent
(100%) of the membership interests in the Subsidiary.

 

1.1.31      “Other Sellers”: collectively, NG
Partnership Interests Seller, Portfolio Seller and Harborside Seller.

 

1.1.32      “Other Real Property”:  collectively, (a) Harborside and (b) the
property commonly known as 7555 Colshire Drive, McLean, Virgina and Harborside.

 

5

 

1.1.33      “Acquired Interests”:  collectively, the NG Partnership Interests
and the Harborside Membership Interests.

 

1.1.34      “Other Purchase and Sale Agreements”:  collectively, the Harborside Purchase and
Sale Agreement, the Portfolio Purchase and Sale Agreement and the NG
Partnership Interests Purchase and Sale Agreement.

 

1.1.35        “Acquired Properties”: collectively, the
Membership Interests, the Acquired Interests and the Portfolio Property.

 

1.1.36      “NG Partnership Interests Seller”:
collectively, iStar NG Inc., a Delaware corporation, and iStar NG GenPar Inc.,
a Delaware corporation.

 

1.1.37      “Northrop”: Northrop Grumman Systems
Corporation, a Delaware corporation.

 

1.2           Closing Costs. 
Closing costs shall be allocated and paid as follows:

 

 

	
  Cost

  	
   

  	
  Responsible Party

  
	
  Title
  Commitment required to be delivered pursuant to Section 5.1

  	
   

  	
  Seller

  
	
  Premium
  for standard form Title Policy with Extended Coverage, Co-Insurance and
  one-half (1/2) of the Non-Imputation Endorsement (subject to this Section 1.2
  and Section 5.4) required to be delivered pursuant to Section 5.4

  	
   

  	
  Seller

  
	
  Premium
  for any upgrade of the Title Policy for additional coverage, including,
  without limitation, the premium for any re-insurance, and any endorsements to
  the Title Policy desired by Purchaser (except that Purchaser shall pay only
  one-half (1/2) of the premium for the Non-Imputation Endorsement), any
  inspection fee charged by the Title Company, tax certificates, municipal and
  utility lien certificates, and any other Title Company charges other than
  those required in connection with satisfying any liens which are not
  Permitted Exceptions

  	
   

  	
  Purchaser

  
	
  Any
  increase in the premium for the Title Policy attributable to obtaining
  Co-Insurance as provided in Section 5.4

  	
   

  	
  Purchaser

  
	
  Any
  costs required to cause the Title Company to issue the Title Policy with
  Extended Coverage

  	
   

  	
  Seller

  
	
  Costs
  of a new survey and/or any revisions, modifications or recertifications to
  the existing Survey.

  	
   

  	
  Seller

  
	
  Costs
  for UCC Searches

  	
   

  	
  Purchaser

  
	
  Recording
  Fees

  	
   

  	
  Paid
  in accordance with local custom

  
	
  Any
  deed taxes, documentary stamps, transfer taxes, intangible taxes, mortgage
  taxes or other similar taxes, fees or assessments

  	
   

  	
  Paid
  in accordance with Schedule 1.2

  

 

6

 

	
  Any
  escrow fee charged by Escrow Agent for conducting the Closing

  	
   

  	
  Purchaser
  1⁄2 

  Seller
  1⁄2

  
	
  Real
  Estate Fee to Financial Advisor

  	
   

  	
  Seller

  
	
  All
  other closing costs and expenses incident to this transaction and the closing
  thereof shall be paid by the party incurring the same.

  	
   

  	
   

  

 

1.3           Notice Addresses.  All notices required or permitted to be sent
hereunder shall be sent as follows:

 

 

	
  Purchaser:

  	
  TRT
  Acquisitions LLC

  	
  Copies
  to:

  	
  TRT
  Acquisitions LLC

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  518
  17th Street, Suite 1700

  	
   

  	
  518
  17th Street, Suite 1700

  
	
   

  	
  Denver,
  CO 80202

  	
   

  	
  Denver,
  CO 80202

  
	
  Attention:

  	
  Mr.
  John Blumberg

  	
   

  	
  Attention:

  	
  Joshua
  J. Widoff, Esq.

  
	
   

  	
  Mr.
  Greg Moran

  	
   

  	
   

  	
   

  
	
  Telephone:

  	
  303-228-2200

  	
   

  	
  Telephone:

  	
  303-228-2200

  
	
  Facsimile:

  	
  303-577-9797

  	
   

  	
  Facsimile:

  	
  303-869-4602

  
	
  E-mail:

  	
  gmoran@dividendcapital.com

  	
   

  	
  E-mail:

  	
  jwidoff@dividendcapital.com

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  and

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Greenberg
  Traurig, LLP

  
	
   

  	
   

  	
   

  	
  200
  Park Avenue

  
	
   

  	
   

  	
   

  	
  New
  York, NY 10166

  
	
   

  	
   

  	
   

  	
  Attention:
  Robert J. Ivanhoe, Esq.

  
	
   

  	
   

  	
   

  	
  Telephone:
  212-801-9333

  
	
   

  	
   

  	
   

  	
  Facsimile:
  212-801-6400

  
	
   

  	
   

  	
   

  	
  E-mail:
  ivanhoer@gtlaw.com

  
	
   

  	
   

  	
   

  	
   

  
	
  Seller:

  	
  c/o iStar Financial Inc.

  	
  Copies to:

  	
  iStar
  Financial Inc.

  
	
   

  	
  1114
  Avenue of the Americas

  	
   

  	
  1114
  Avenue of the Americas

  
	
   

  	
  New
  York, NY 10036

  	
   

  	
  New
  York, NY 10036

  
	
   

  	
  Attention:
  Samantha Garbus

  	
   

  	
  Attn:
  Mary-Beth Roselle, Esq.

  
	
   

  	
  Telephone:
  212-930-9407

  	
   

  	
  Telephone:
  212-930-9481

  
	
   

  	
  Facsimile:
  212-930-9494

  	
   

  	
  Facsimile: 212-930-9494

  
	
   

  	
  E-mail: sgarbus@istarfinancial.com

  	
   

  	
  E-mail: mroselle@istarfinancial.com

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  iStar
  Asset Services Inc.

  
	
   

  	
   

  	
   

  	
  180
  Glastonbury Boulevard

  
	
   

  	
   

  	
   

  	
  Glastonbury,
  CT 06033

  
	
   

  	
   

  	
   

  	
  Attn:
  President

  
	
   

  	
   

  	
   

  	
  Telephone:
  860-815-5910

  
	
   

  	
   

  	
   

  	
  Facsimile:
  860-815-5901

  
	
   

  	
   

  	
   

  	
  E-mail:
  brubin@istarfinancial.com

  

 

7

 

	
   

  	
   

  	
   

  	
  Katten
  Muchin Rosenman LLP

  
	
   

  	
   

  	
   

  	
  525
  West Monroe St.

  
	
   

  	
   

  	
   

  	
  Chicago,
  IL 60661-3693

  
	
   

  	
   

  	
   

  	
  Attn:
  Gregory P.L. Pierce, Esq.

  
	
   

  	
   

  	
   

  	
  Phone:
  312-902-5541

  
	
   

  	
   

  	
   

  	
  Fax:
  312-577-8893

  
	
   

  	
   

  	
   

  	
  Email:
  greg.pierce@kattenlaw.com

  

 

ARTICLE 2

MEMBERSHIP
INTERESTS

 

2.1           Membership Interests.  Subject to the terms and conditions of this
Agreement, Seller agrees to sell to Purchaser, and Purchaser agrees to purchase
from Seller, the Membership Interests.

 

ARTICLE 3

EARNEST MONEY

 

Purchaser
and Seller acknowledge and agree (i) that Purchaser has deposited with Escrow
Agent Earnest Money (as defined in the Portfolio Purchase and Sale Agreement)
in the amount of $46,200,000.00, (ii) that a portion of the Earnest Money equal
to the Membership Interest Earnest Money is allocated to the purchase and sale
of the Membership Interests pursuant to this Agreement, and (iii) the Earnest
Money, including the Membership Interest Earnest Money, shall be held and
disbursed by Escrow Agent pursuant to, and in accordance with, the terms and
provisions of the Portfolio Purchase and Sale Agreement.  “Membership Interest Earnest Money” means the
product of (1) the Earnest Money and (2) the ratio of (A) the Purchase Price
hereunder to (B) the sum of the (x) Purchase Price hereunder, (y) the Purchase
Price under the Portfolio Purchase and Sale Agreement and (z) the Purchase
Price under the NG Partnership Interests Purchase and Sale Agreement

 

ARTICLE 4

DUE DILIGENCE

 

4.1           Due Diligence Materials To Be Delivered.  Seller has delivered to Purchaser complete
(to Seller’s knowledge) copies of, or made electronic copies available to
Purchaser on Seller’s iPortal internet site relating to the Property and
Membership Interests (“iPortal”), the
following (the “Property Information,”  or the  “Property Documents”):

 

4.1.1        Rent Roll.  A current rent roll in Seller’s standard form
(“Rent Roll”) for the Property;

 

4.1.2        Financial Information.  Operating statements and summaries of capital
expenditures pertaining to the Property during the Seller’s Ownership Period
(collectively, “Operating Statements”);

 

8

 

4.1.3        Environmental Reports.  A copy of any environmental reports or
environmental site assessments related to the Property prepared for the benefit
of Seller or the Subsidiary (as applicable), it being acknowledged by Purchaser
that Purchaser shall not be entitled to rely thereon absent an express reliance
letter from the company issuing such environmental reports or environmental
site assessments obtained by Purchaser at Purchaser’s sole cost and expense;

 

4.1.4        Tax Statements. Ad valorem tax
statements relating to the Property for Seller’s Ownership Period;

 

4.1.5        Survey.  A copy of the most current survey, if any, of
the Property in Seller’s possession (the “Survey”);

 

4.1.6        Service Contracts.  Copies of any Service Contracts for the
Property;

 

4.1.7        Personal Property.  A list of Tangible Personal Property for the
Property;

 

4.1.8        License Agreements.  Copies of any License Agreements for the
Property;

 

4.1.9        Lease Files.  The lease file for the Leases affecting the
Property, including, without limitation, the Leases, any amendments thereto,
the Guaranties (if applicable), any amendments thereto, any letter agreements,
any assignments which are then in effect and any letters of credit which are
then in effect (collectively, the “Lease
Files”);

 

4.1.10      Maintenance Records and Warranties.  Maintenance work orders for the Property for
the 12 months preceding the Effective Date and warranties for the Property, if
any, on roofs, air conditioning units, fixtures and equipment;

 

4.1.11      Plans and Specifications.  Building plans and specifications relating to
the Property, if any;

 

4.1.12      Licenses, Permits and Certificates of Occupancy.  Licenses, permits and
certificates of occupancy relating to the Property and umbrella policies
related thereto;

 

4.1.13      Insurance Certificates.
Copies of certificates evidencing the existing liability and casualty insurance
coverage for the Property maintained by the Subsidiary (as applicable) and
other affiliates of Seller;

 

4.1.14      Intentionally Deleted;

 

4.1.15      Organizational Documents.  The Subsidiary Agreement, all related
articles, charters, certificates of formation, and registrations and minutes,
and any amendments and modifications thereto;

 

4.1.16      Books and Records.  The Books and Records; and

 

9

 

4.1.17      Financial Statements.
Unaudited financial statements and reports of the Subsidiary in such form as
compiled by Seller or the Subsidiary during Seller’s Ownership Period
(collectively, the “Financial Statements”).

 

Except
for the Rent Roll contemplated in Section 4.1.1, Seller’s obligation to
deliver the items listed in this Section 4.1 shall be limited to the
extent such items are in the possession of Seller or the Subsidiary.

 

4.2           Physical Due Diligence.  As of the Effective Date, Purchaser
acknowledges and agrees that Purchaser has conducted such inspections and tests
of the Property, including surveys and architectural, engineering, geotechnical
and environmental inspections and tests, as Purchaser has deemed necessary to
satisfy itself as to the condition of the Property.  Commencing on the Effective Date and
continuing until the Closing, subject to the terms of the Leases, Purchaser
shall have reasonable access to the Property at all reasonable times during
normal business hours, upon appropriate notice to tenants as permitted or
required under the Leases, for the purpose of conducting such additional
reasonably necessary tests, including surveys and architectural, engineering,
geotechnical and environmental inspections and tests, provided that (a) Purchaser
must give Seller the greater of (i) two (2) full Business Days’  or (ii) the minimum notice period required by the
applicable Leases for the Property, written notice of any such inspection or
test, and with respect to any intrusive inspection or test (i.e., core
sampling) must obtain Seller’s prior written consent (which consent shall not
be unreasonably withheld or conditioned), (b) prior to performing any
inspection or test, Purchaser must deliver a certificate of insurance to Seller
evidencing that Purchaser and its contractors, agents and representatives have
in place (and Purchaser and its contractors, agents and representatives shall
maintain during the pendency of this Agreement) (1) commercial general
liability insurance with limits of at least One Million Dollars ($1,000,000)
per occurrence and Two Million Dollars ($2,000,000) in the aggregate for bodily
injury or death and property damage insurance including coverage for
contractual liability and personal and advertising injury with respect to
Purchaser’s obligations hereunder, and (2) workers’ compensation and
employers’ liability insurance with limits of at least $100,000 each accident,
$100,000 each employee and $500,000 policy limit, all covering any accident
arising in connection with the presence of Purchaser, its contractors, agents
and representatives on the Property, which insurance, except for workers’
compensation and employers’ liability, shall (A) name as additional
insureds thereunder Seller, the Subsidiary and such other parties holding
insurable interests as Seller may designate and (B) be written by a
reputable insurance company having a rating of at least “A+:VII” by Best’s
Rating Guide (or a comparable rating by a successor rating service), and (C) otherwise
be subject to Seller’s prior approval, which approval shall not be unreasonably
withheld, conditioned or delayed, and (c) all such tests shall be
conducted by Purchaser in compliance with Purchaser’s responsibilities set
forth in Section 4.9 below.  The
requirement to carry the insurance specified in the preceding sentence may be
satisfied through blanket or umbrella insurance policies carried by Purchaser
or its affiliates.  Purchaser shall bear
the cost of all such inspections or tests and shall be responsible for and act
as the generator with respect to any wastes generated by those tests, which
obligation shall survive the termination of this Agreement.  Subject to the provisions of Section 4.7
hereof, Purchaser or Purchaser’s representatives may communicate with any
Seller-designated tenant representative; provided, however, Purchaser must
contact Seller at least three (3) full Business Days in advance by
telephone to inform Seller of Purchaser’s intended communication with any
Seller-designated tenant representative and allow Seller the opportunity to
participate in such

 

10

 

communication if Seller desires.  No assurance or guaranty is afforded by
Seller that any Seller-designated tenant representative will communicate with
Purchaser or Purchaser’s representatives. 
Subject to the provisions of Section 4.7 and 4.10 hereof, Purchaser
or Purchaser’s representatives may, without Seller’s consent or participation,
communicate with any governmental authority for the sole purpose of gathering
information regarding current zoning compliance of the Real Property and
current entitlements with respect to the Real Property in connection with the
transaction contemplated by this Agreement. 
Other than as set forth in the previous sentence, Purchaser must contact
Seller at least three (3) full Business Days in advance by telephone to
inform Seller of Purchaser’s intended communication with any governmental
authority and to allow Seller the opportunity to participate in such
communication if Seller desires.  As used
in this Section 4.2, “communicate” and “communication” shall mean the
initiation of, response to, or sharing or exchange of information, knowledge or
messages, whether by oral, written or electronic methods or media, or by any
other means in person or otherwise, and includes requests for inspections or
other access to the Property.

 

4.3           Due Diligence/Financing Contingency Termination Rights.

 

4.3.1        Purchaser
acknowledges and agrees that as of the Effective Date Purchaser has received or
had access to all Property Documents (as defined herein and in the Other
Purchase and Sale Agreements) and has conducted all inspections and tests of
the Property, the Acquired Properties and the Other Real Property that it considers
important.

 

4.3.2        Purchaser
intends to obtain financing for the transactions contemplated by this Agreement
and the Other Purchase and Sale Agreements from (i) Fixed Rate Lender,
Floating Rate Lender and Harborside Lender pursuant to the terms of the Fixed
Rate Loan Term Sheet, the Floating Rate Loan Term Sheet and the Harborside Term
Sheet, respectively, copies of which have been delivered to iStar and Seller,
and (ii) iStar in the form of the Mezzanine Loan. iStar has agreed to
provide the Mezzanine Loan on and subject to the terms and conditions of Section 4.3.2
of the Portfolio Purchase and Sale Agreement and Schedule 4.3.2 attached
thereto. Capitalized terms used in this Section 4.3.2 and not defined in
this Agreement shall have the meanings ascribed to such terms in the Portfolio
Purchase and Sale Agreement.

 

4.4           Updated Property Information.  From the Effective Date through the Closing
Date, if and to the extent that Seller or the Subsidiary receive from an
unaffiliated third-party any additional Property Information not previously
provided to Purchaser, or if and to the extent that Seller or the Subsidiary
receive any document, notice or correspondence from an unaffiliated third-party
or otherwise obtains actual knowledge from an unaffiliated third-party source
of a condition arising after the Effective Date that would render any of the
representations and warranties of Seller in Section 9.1 untrue if and to
the extent remade after the Effective Date, Seller shall promptly so notify
Purchaser and shall make electronic copies of all such documents, notices,
correspondence or other information in Seller’s or the Subsidiary’s possession
(“Updated Property Information”)
available to Purchaser on iPortal. Updated Property Information may include any
information disclosed in the Tenant Estoppel Certificate, but such updated
information shall remain subject to Purchaser’s rights pursuant to Section 7.2.1(1) and
7.2.3.  The representations and
warranties of Seller in Section 9.1 shall be deemed amended to reflect
such Updated Property Information, provided that if the amendment or deemed
amendment of any representation or warranty reflects a fact or circumstance
that would trigger a

 

11

 

termination, extension or other right of Purchaser
under this Agreement, the amendment or deemed amendment of any representation
or warranty to reflect such fact or circumstance shall not vitiate such right
of Purchaser.

 

4.5           Return of Documents and Reports.  As additional consideration for the
transaction contemplated herein, if Purchaser terminates this Agreement,
Purchaser shall provide to Seller, if requested by Seller, promptly following
the receipt of notice from Seller after the termination of this Agreement,
copies of all “Reports”.  “Reports” mean (a) written third-party reports, tests,
investigations and studies that pertain to contamination of, or environmental
concerns regarding, the Property delivered to Purchaser or its affiliates, and (b) all
other written third party reports, investigations and studies, other than
economic analyses in each case under (a) and (b) prepared for
Purchaser in connection with its due diligence review of the Property,
including, without limitation, any and all Reports involving structural or
geological conditions, environmental, hazardous waste or hazardous substances
contamination of the Property, if any. 
The Reports shall not include any documents, materials or information
which are subject to attorney/client, work product or similar privilege, which
constitute attorney communications with respect to the Property and/or
Purchaser, or which are subject to a confidentiality agreement.  The Reports shall be delivered to Seller at
no cost to Seller and without any representation or warranty as to the
completeness or accuracy of the Reports or any other matter relating
thereto.  Purchaser’s obligation to
deliver the Reports to Seller shall survive the termination of this Agreement.

 

4.6           Service Contracts.  On or prior to the Closing Date, Purchaser
will advise Seller in writing which Service Contracts Purchaser requests that
Seller or the Subsidiary terminate at or prior to Closing, provided Seller and
the Subsidiary shall have no obligation to terminate any Service Contracts
which by their terms cannot be terminated without penalty or payment of a fee
(unless Purchaser agrees in writing to pay such fee).  Seller shall deliver at Closing notices of
termination of all Service Contracts that Purchaser so directs.  The Subsidiary shall from and after the
Closing Date continue to be bound by those Service Contracts (a) that
Purchaser has elected not to have Seller or the Subsidiary terminate, and (b) for
which a termination notice is delivered as of or prior to Closing but for which
termination is not effective until after Closing.

 

4.7           Proprietary Information; Confidentiality.  Purchaser agrees that it is bound by the
Confidentiality Agreement as if it were a party thereto, and the
Confidentiality Agreement remains in full force and effect. Notwithstanding
anything to the contrary set forth in the Confidentiality Agreement, (a) each
party acknowledges that the other party shall be allowed to disclose the
existence of this Agreement and the contents thereof in order to comply with
certain disclosure requirements relating to public companies and their
affiliates and (b) Purchaser shall be allowed to disclose the existence of
this Agreement, and deliver the Property Information and Updated Property
Information, to third parties in connection with such third parties’ potential
acquisition from Purchaser of the Membership Interests, the Property or
interests therein after the Closing Date so long as such third parties have
agreed in writing to be bound by the terms of the Confidentiality Agreement
prior to Purchaser’s disclosure of the existence of this Agreement, and
delivery of the Property Information and Updated Property Information, to such
third parties. The parties shall coordinate, in advance, with respect to any
such public filings and/or press releases. 
After the Closing there shall be no restriction as between Purchaser, on
the one hand,

 

12

 

and
Seller and the Subsidiary, on the other hand, on Purchaser’s disclosure of
Property Information or Updated Property Information.

 

4.8           No Representation or Warranty by Seller.  Purchaser acknowledges that, except as
expressly set forth in this Agreement, Seller has not made and does not make
any warranty or representation regarding the truth, accuracy or completeness of
the Property Documents, the Updated Property Information or the source(s) thereof.  Purchaser further acknowledges that some if
not all of the Property Documents and Updated Property Information were
prepared by third parties other than Seller and the Subsidiary.  Except as expressly set forth in this
Agreement or in any of the documents delivered at the Closing, (a) Seller
expressly disclaims any and all liability for representations or warranties,
express or implied, statements of fact and other matters contained in such
information, or for omissions from the Property Documents or Updated Property
Information, or in any other written or oral communications transmitted or made
available to Purchaser, (b) Purchaser shall rely solely upon its own
investigation with respect to the Membership Interests and the Property,
including, without limitation, their physical, environmental or economic
condition, compliance or lack of compliance with any ordinance, order, permit
or regulation or any other attribute or matter relating thereto, and (c) Seller
and the Subsidiary have not undertaken any independent investigation as to the
truth, accuracy or completeness of the Property Documents and Updated Property
Information and are providing the Property Documents and Updated Property
Information solely as an accommodation to Purchaser.

 

4.9           Purchaser’s Responsibilities.  In conducting any inspections, investigations
or tests of the Property, Property Documents and/or Updated Property
Information, Purchaser and its agents and representatives shall:  (a) not disturb the tenants or interfere
with their use of the Property pursuant to their respective Leases; (b) not
interfere with the operation and maintenance of the Property; (c) not
damage any part of the Property or any personal property owned or held by any
tenant or any third party; (d) not injure or otherwise cause bodily harm
to Seller or its agents, guests, invitees, contractors and employees or any
tenants or their agents, guests, invitees, contractors and employees; (e) comply
with all applicable laws; (f) promptly pay when due the costs of all
tests, investigations, and examinations done with regard to the Property; (g) not
permit any liens to attach to the Real Property by reason of the exercise of
its rights hereunder; (h) subject to the provisions of Section 4.10,
repair any damage to the Real Property resulting directly or indirectly from
any such inspection or tests; and (i) not reveal or disclose prior to
Closing any information obtained during the Inspection Period (as defined in
the Portfolio Purchase and Sale Agreement) concerning the Property, the
Property Documents and the Updated Property Information to anyone other than
the Permitted Recipients (as defined in the Confidentiality Agreement), in accordance
with the confidentiality standards set forth in Section 4.7 above, or
except as may be otherwise required by law. 
Purchaser’s obligations under this Section 4.9 shall survive the
termination of this Agreement.

 

4.10         Purchaser’s Agreement to Indemnify.  Purchaser hereby agrees to indemnify, defend
and hold Seller and the Subsidiary harmless from and against any and all liens,
claims, causes of action, damages, liabilities and expenses (including
reasonable attorneys’ fees) arising out of Purchaser’s inspections or tests
permitted under this Agreement or any violation of the provisions of Sections
4.2, 4.7, and 4.9; provided, however, the indemnity shall not protect Seller
and the Subsidiary from any liabilities for matters merely discovered by Purchaser
(i.e.,

 

13

 

environmental contamination) so long as Purchaser’s
actions do not aggravate any pre-existing liability of Seller and the
Subsidiary it being agreed by Purchaser and Seller that the mere discovery by
Purchaser of such matters shall not constitute an aggravation of any
pre-existing liability of Seller and the Subsidiary.  Purchaser also hereby agrees to indemnify,
defend and hold any tenant harmless from and against any and all claims, causes
of action, damages, liabilities and expenses which such tenant may suffer or
incur due to Purchaser’s breach of its obligation under Sections 4.7 and 4.9
above to maintain the confidential nature of any Property Documents, Updated
Property Information or other information relative to such tenant.  Purchaser’s obligations under this Section 4.10
shall survive the termination of this Agreement and shall survive the Closing.

 

ARTICLE 5

TITLE AND SURVEY

 

5.1           Title Commitment.  Purchaser acknowledges that a copy of a
current commitment for title insurance or a preliminary title report with
respect to the Property, together with copies of all documents of record
referred to therein (the “Title Commitment”)
issued by First American on an ALTA 2006 Owner’s Form or state promulgated
form has been delivered or made available to Purchaser.

 

5.2           Updated Survey.  Purchaser has arranged, at Seller’s expense,
for the preparation of a new survey or the revision, modification, or
re-certification of the existing Survey as necessary in order for First
American to delete the survey exception from the Title Policy.

 

5.3           Title Review. 
Seller shall have no obligation to cure title objections except liens of
an ascertainable amount created by, under or through Seller or the Subsidiary,
or assumed by Seller or the Subsidiary, which liens Seller shall cause to be
released at or prior to Closing (with Seller having the right to apply the
Purchase Price or a portion thereof for such purpose), and Seller or the
Subsidiary shall deliver the Property free and clear of any such liens;
provided, however, that the foregoing requirement to discharge liens shall not
apply to liens on any tenant’s  leasehold
estate.  Seller further agrees to remove
any exceptions or encumbrances to title which are voluntarily created by, under
or through Seller or the Subsidiary after the Effective Date without Purchaser’s
consent (if requested, such consent shall not be unreasonably withheld or
delayed).  The term “Permitted
Exceptions” shall mean the exceptions to title set forth in the Pro
Forma Policy (as defined in the Portfolio Purchase and Sale Agreement) as
updated by the Title Company as a result of (i) any actions taken by
Seller which are expressly permitted by the terms of this Agreement or (ii) any
acts or failure to act taken by Purchaser.

 

5.4           Delivery of Title Policy and Non-Imputation Endorsement at Closing.  The parties acknowledge that First American
Title Insurance Company, National Commercial Services — Chicago (“First American”) and Fidelity Title Insurance Company (“Fidelity”) constitute the Title Company. First American
shall act as the lead Title Company and underwriter and shall issue the Title
Policy and the Non-Imputation Endorsement; provided, however, that Purchaser
may obtain co-insurance from Fidelity in the amount of up to fifty percent
(50%) of the Purchase Price of the Property in the form of a co-insurance
endorsement (“Co-Insurance”) so long as (i) the
cost of such Co-Insurance does not increase the total cost of title insurance
that Seller would otherwise pay to First American if First American were
insuring

 

14

 

the full Purchase Price unless Purchaser pays for
such increased cost of title insurance and (ii) the issuance of such Co-Insurance
does not delay the Closing. Purchaser, at Purchaser’s sole cost and expense,
may obtain re-insurance with respect to the Title Policy from such third
parties as Purchaser may elect so long as obtaining such re-insurance does not
delay the Closing. In the event that the Title Company does not issue at
Closing, or unconditionally commit at Closing to issue, to Purchaser, (i) an
owner’s title insurance policy and Co-Insurance in accordance with the Title
Commitment with Extended Coverage, insuring the Subsidiary’s title interest in
the Real Property in the amount of the Purchase Price, subject only to the
exclusions from coverage contained in the policy and the Permitted Exceptions
(the “Title Policy”) and (ii) a
non-imputation endorsement with respect to the conveyance of the Membership
Interests in the form approved for issuance in the State of Virginia (the Non-Imputation Endorsement”), Purchaser shall have the
right, subject to the limitations of Sections 7.2.1(4) and 7.2.2(9), to
terminate this Agreement, in which case the parties hereto shall have no
further rights or obligations, other than those that by their terms survive the
termination of this Agreement; provided, however, if either Title Company alone
is willing to deliver the Title Policy in the amount of the Purchase Price and
the Non-Imputation Endorsement, Purchaser agrees to accept such Title Policy
and Non-Imputation Endorsement and Purchaser shall have no right to terminate
this Agreement.

 

ARTICLE 6

OPERATIONS AND RISK OF LOSS

 

6.1           Ongoing Operations.  From the Effective Date through Closing:

 

6.1.1        Leases, Service Contracts and License Agreements.  Seller will cause the Subsidiary
to perform their material obligations under the Leases, Service Contracts and
License Agreements unless the Subsidiary are excused from performing such
obligations pursuant to such Leases, Services Contracts and License Agreements.

 

6.1.2        New Contracts.  Except as provided in Section 6.1.4,
Seller will not cause the Subsidiary to enter into any contract that will be an
obligation affecting the Property subsequent to the Closing, except contracts
entered into in the ordinary course of business that are terminable without
cause and without the payment of any termination penalty on not more than 30
days’ prior notice.

 

6.1.3        Maintenance of Improvements; Removal of Personal Property.  Subject to Sections 6.2  and 6.3, Seller shall cause the Subsidiary
to maintain or cause the Subsidiary to use reasonable efforts to cause the
tenants under the Leases to maintain all Improvements substantially in their
present condition (ordinary wear and tear and casualty excepted) and in a
manner consistent with the Subsidiary’s maintenance of the Improvements during
the Subsidiary’s period of ownership. 
Seller will cause the Subsidiary not to remove any Tangible Personal
Property except as may be required for necessary repair or replacement or with
respect to items that, in Seller’s judgment are obsolete, and replacement shall
be of approximately equal quality and quantity as the removed item of Tangible
Personal Property.

 

6.1.4        Leasing; License Agreements.  Seller will cause the Subsidiary not to (i) amend
or terminate any existing Lease or License Agreement, (ii) consent to the
assignment of any Lease or License Agreement, (iii) enter into any new
Lease or new License Agreement, (iv)

 

15

 

grant their consent, to
the extent Subsidiary’s consent is required, to a sublease of the Property, a
modification of a sublease, an assignment of a sublease or other item for which
a consent is required under any Lease or License Agreement or (v) grant an
acknowledgement with respect to a sublease of the Property, a modification of a
sublease or an assignment of a sublease (the foregoing items (i), (ii), (iii), (iv) and
(v) are each referred to herein as, a “Lease
Event”) after the Effective Date and prior to the Closing Date
without first (a) providing Purchaser all relevant supporting
documentation, as reasonably determined by Seller, including, without
limitation, financial information for the assignee, tenant, subtenant and any
guarantor to the extent in Seller’s or the Subsidiary’s possession, and (b) obtaining
Purchaser’s approval of such Lease Event. 
Purchaser shall be held to the same standard for approval as Seller or
the Subsidiary, as applicable, is held to in the document giving rise to such
approval, consent, or acknowledgement right, and Purchaser agrees to give
Seller written notice of its approval or disapproval of a proposed Lease Event within
three (3) Business Days after Purchaser’s receipt of the items in Section 6.1.4(a) and
Section 6.1.4(b).  If Purchaser does
not respond to Seller’s request within such time period, then Purchaser will be
deemed to have approved such Lease Event. 
So long as Purchaser has complied with the standard for review described
above, Purchaser may withhold its approval in its reasonable discretion, and
Seller will cause the Subsidiary not to execute or grant such Lease Event
without Purchaser’s written approval.

 

Seller
shall cause the Subsidiary not to apply any tenant or licensee security
deposits on account of any alleged default by any tenant or licensee unless the
Subsidiary has terminated the applicable Lease or License Agreement and
obtained possession of the demised or licensed premises.  All tenant and licensee security deposits
collected and not applied by the Subsidiary as of the Effective Date are set
forth on Schedule 6.1.4.

 

6.1.5          Insurance.  Seller will cause the Subsidiary not to
terminate or allow any insurance maintained by the Subsidiary with respect to
the Property or any umbrella coverage insurance carried by any affiliate of
Seller which insures the Property to lapse unless replaced by equivalent
coverage. Upon the Effective Date, Seller shall cause the Subsidiary and Seller’s
affiliates to name Purchaser as an additional insured on all insurance
maintained by the Subsidiary with respect to the Property and on all umbrella
insurance coverage carried by any affiliate of Seller which insures the
Property.

 

6.1.6          No Amendment.  After the Effective Date, Seller shall not,
and Seller shall not permit the Subsidiary, to amend the Subsidiary Agreement.

 

6.1.7          No Merger. Seller shall not permit
the Subsidiary to merge or consolidate with or agree to merge or consolidate
with, or purchase or agree to purchase all or substantially all of the assets
of, or otherwise acquire, any corporation, partnership or other business
organization.

 

6.1.8          Interests.  Seller shall not permit the Subsidiary to
authorize for issuance, issue, sell or delivery any additional membership
interests in the Subsidiary or grant any option, warrant or other right to
purchase any such membership interests. Seller shall not permit the Subsidiary
to split, combine or reclassify any of the membership interests of the
Subsidiary.

 

16

 

6.1.9          Debt.  Seller shall not permit the Subsidiary to
incur or become subject to, nor agree to incur, any debt for borrowed money,
guaranty any indebtedness, or incur any liabilities other than and specifically
excluding liabilities incurred in the ordinary course of business related to
the ownership and management of the Property.

 

6.1.10        Conditions and Obligations.
To the extent performance of any obligation of Seller under this Agreement or
the satisfaction of any condition of Purchaser’s obligation to close requires
the performance of the Subsidiary, Seller shall cause the Subsidiary to perform
or satisfy same.

 

6.2           Casualty.  If after
the Effective Date and prior to the Closing, the Property is damaged by fire or
other casualty (a “Casualty”),
Seller shall, promptly upon Seller or any of the Subsidiary receiving actual
knowledge thereof, notify Purchaser of the same.  If, as a result of such Casualty, Unisys is
entitled to and elects to terminate its Lease with respect to the Property (a “Casualty Tenant Termination Event”), then Seller shall
promptly upon Seller or the Subsidiary receiving notice of such Casualty Tenant
Termination Event notify Purchaser of the same (a “Casualty
Tenant Termination Notice”). Within five (5) days after receipt
of the Casualty Tenant Termination Notice (but in no event later than the
Closing Date), Purchaser shall notify Seller in writing of Purchaser’s election
to either (i) subject to the limitations of Section 7.2.1(4) and
7.2.2(9), terminate this Agreement, in which case the parties hereto shall have
no further rights or obligations hereunder, except for rights and obligations
which, by their terms, survive the termination hereof, or (ii) to acquire
the Membership Interests notwithstanding the Casualty Tenant Termination Event.
If (i) Purchaser elects to acquire the Membership Interests
notwithstanding the Casualty Tenant Termination Event or fails to terminate
this Agreement with respect to the Membership Interests within such five (5) day
period, or (ii) such Casualty does not give rise to a Casualty Tenant
Termination Event, then Purchaser shall proceed to Closing, and as of Closing, (1) Seller
shall provide written confirmation that any resulting insurance proceeds
(including any rent loss insurance and rent abatement insurance applicable to
any period beginning with the Closing Date) due the Subsidiary or an affiliate
of Seller as a result of such Casualty will be available after Closing to the
Subsidiary to effectuate the needed repairs, (2) the Subsidiary shall
maintain full responsibility for all needed repairs (subject to the terms of
the Lease with respect to any rights of Unisys), and (3) Purchaser shall
receive a credit at Closing for any deductible amount under such insurance
policies to the extent not payable by Unisys. 
Notwithstanding anything contained herein to the contrary, if a Casualty
shall occur to the Property and, as a result of such Casualty, the lender
providing the Fixed Rate Loan or the Floating Rate Loan will not close the
Fixed Rate Loan or the Floating Rate Loan, as applicable, with respect to such
Property, then, subject to the limitations of Sections 7.2.1(4) and
7.2.2(9), this Agreement shall automatically terminate, in which case the
parties hereto shall have no further right or obligations hereunder, except for
rights and obligations which, by their terms, survive the termination hereof.

 

6.3           Condemnation. If after the Effective Date and prior to the Closing, Seller or the
Subsidiary receive notice of, or proceedings are instituted for, eminent domain
with respect to the Property or any portion thereof (a “Condemnation”),
Seller shall, promptly upon Seller or the Subsidiary receiving actual knowledge
thereof, notify Purchaser of the same. 
If, as a result of such Condemnation, Unisys is entitled to and elects
to terminate its Lease with respect to such Condemnation (a “Condemnation Tenant Termination Event”), then Seller shall
promptly

 

17

 

upon Seller or any Affiliate receiving notice of
such Condemnation Tenant Termination Event notify Purchaser of the same (a “Condemnation Tenant Termination Notice”). Within five (5) days
after receipt of the Condemnation Tenant Termination Notice (but in no event
later than the Closing Date), Purchaser shall notify Seller in writing of
Purchaser’s election to either (i) subject to the limitations of Section 7.2.1(4) and
7.2.2(9), terminate this Agreement, in which case the parties hereto shall have
no further rights or obligations hereunder, except for rights and obligations
which, by their terms, survive the termination hereof, or (ii) to acquire
the Membership Interests notwithstanding the Condemnation Tenant Termination
Event. If (i) Purchaser elects to acquire the Membership Interests
notwithstanding the Condemnation Tenant Termination Event or fails to terminate
this Agreement with respect to the Membership Interests within such five (5) day
period, or (ii) such Condemnation does not give rise to a Condemnation
Tenant Termination Event, then Purchaser shall proceed to Closing, and as of
Closing, the Subsidiary shall maintain the right to negotiate and otherwise
deal with the condemning authority in respect of such Condemnation (subject to
the terms of the Lease with respect to any rights of Unisys). Notwithstanding
anything contained herein to the contrary, if a Condemnation shall occur to any
Property and, as a result of such Condemnation, the lender providing the Fixed
Rate Loan or the Floating Rate Loan will not close the Fixed Rate Loan or the
Floating Rate Loan, as applicable, with respect to such Property, then, subject
to the limitations of Sections 7.2.1(4) and 7.2.2(9), this Agreement shall
automatically terminate, in which case the parties hereto shall have no further
right or obligations hereunder, except for rights and obligations which, by
their terms, survive the termination hereof.

 

6.4           Tenant Estoppel Certificate/SNDA.

 

6.4.1        Purchaser
acknowledges that Unisys has executed and delivered to Seller a tenant estoppel
certificate (such tenant estoppel certificate is referred to herein as, the “Tenant Estoppel Certificate”) in the form
approved by Purchaser, Fixed Rate Lender and/or Floating Rate Lender (as such
terms are defined in the Portfolio Purchase and Sale Agreement).

 

6.4.2        Purchaser
and Seller acknowledge and agree that as of the Effective Date, Seller, on
behalf of the Subsidiary, has sent an estoppel certificate addressed to the
party listed on Schedule 6.4.2
(the “Third Party Estoppel Certificate”).  Seller and the Subsidiary shall not be
obligated to expend any funds in connection with obtaining any such Third Party
Estoppel Certificate, declare any default under any agreement or commence any legal
action for enforcement of any agreement in order to obtain any such Third Party
Estoppel Certificate.  Seller shall copy
Purchaser on the initial correspondence soliciting the Third Party Estoppel
Certificate and shall use commercially reasonable efforts to forward to
Purchaser any written communications, including, without limitation, letters,
memorandums, e-mails, comments and conditions, received from the third parties
in connection with the third parties’ execution of the Third Party Estoppel
Certificate.

 

6.4.3        Purchaser
acknowledges that Unisys has executed and delivered to Seller a subordination,
non-disturbance and attornment agreement (such subordination, non-disturbance
and attornment agreement is referred to herein as, the “SNDA”) in the form approved by Purchaser,
Fixed Rate Lender and/or Floating Rate Lender.

 

18

 

ARTICLE 7

CLOSING

 

7.1           Closing.  The
consummation of the transaction contemplated herein (“Closing”)
shall occur on the Closing Date at the offices of Escrow Agent (or such other
location as may be mutually agreed upon by Seller and Purchaser).  Funds shall be deposited into and held by
Escrow Agent in a closing escrow account with a bank satisfactory to Purchaser
and Seller.  Upon satisfaction or
completion of all closing conditions and deliveries, the parties shall direct
Escrow Agent to immediately record those closing documents which are to be
recorded, and deliver originals or copies of the closing documents to the
appropriate parties and make disbursements according to the closing statements
executed by Seller and Purchaser.

 

7.2           Conditions to Parties’ Obligation to Close.  In addition to all other conditions set forth
herein, the obligation of Seller, on the one hand, and Purchaser, on the other
hand, to consummate the transactions contemplated hereunder are conditioned
upon the following:

 

7.2.1        Conditions to Seller’s Obligations to Close.

 

(1)           Representations and Warranties.  Purchaser’s representations and warranties
contained herein shall be true and correct in all material respects as of the
Effective Date and the Closing Date;

 

(2)           Deliveries.  As of the Closing Date, Purchaser shall have
tendered all deliveries to be made by Purchaser at Closing;

 

(3)           Actions, Suits, etc.  There shall exist no pending or threatened
actions, suits, arbitrations, claims, attachments, proceedings, assignments for
the benefit of creditors, insolvency, bankruptcy, reorganization or other
proceedings, against Purchaser that would materially and adversely affect
Purchaser’s ability to perform its obligations under this Agreement;

 

(4)           Property. It shall be a condition
to Seller’s obligation to close hereunder that neither (x) the NG
Partnership Interests Purchase and Sale Agreement shall have been terminated
with respect to the NG Partnership Interests nor (y) this Agreement, the
Harborside Purchase and Sale Agreement and the Portfolio Purchase and Sale
shall not have been terminated with respect to more than two (2) of the
Acquired Properties (exclusive of the NG Partnership Interests; it being agreed
by Purchaser and Seller that a termination of the NG Partnership Interests
Purchase and Sale Agreement with respect to the NG Partnership Interests is
addressed in the foregoing clause (x) and that the two (2) Acquired
Properties referenced in the foregoing clause (y) shall not include the NG
Partnership Interests for purposes of the application of the foregoing clause
(y)) (it being understood that a termination of the Portfolio Purchase and Sale
Agreement with respect to one or more of the separate sites constituting the
Portfolio Properties leased by The Goodyear Tire & Rubber Company
(collectively, the “Goodyear Properties”)
or one or more separate sites constituting the Portfolio Properties leased by
CEVA Freight, LLC (collectively,

 

19

 

the
“CEVA Properties”) shall be deemed
in both cases to be a termination of the Portfolio Purchase and Sale Agreement
with respect to only one Portfolio Property notwithstanding the Lease with The
Goodyear Tire & Rubber Company and the Lease with CEVA Freight, LLC
cover multiple Portfolio Properties). For clarification, the parties agree that
it is possible for a closing condition (A) under the Harborside Purchase
and Sale Agreement not to be satisfied (for example, the bankruptcy of Schwab)
which would allow Purchaser not to close and to terminate with respect to the
Harborside Membership Interests but proceed to closing under this Agreement,
the Portfolio Purchase and Sale Agreement and the NG Partnership Interests
Purchase and Sale Agreement or (B) under the NG Partnership Interests
Purchase and Sale Agreement not to be satisfied (for example, the bankruptcy of
Northrop) which would allow Purchaser not to close and to terminate with
respect to the NG Partnership Interests and, as a result of such termination,
there would be a failure of a condition to close under this Agreement, the
Harborside Purchase and Sale Agreement and the Portfolio Purchase and Sale
Agreement which would allow Seller to terminate this Agreement, Harborside
Seller to terminate the Harborside Purchase and Sale Agreement and Portfolio
Seller to terminate the Portfolio Purchase and Sale Agreement; and

 

(5)           Simultaneous Closing.
It shall be a condition to Seller’s obligation to close hereunder that the
Closing of the transaction contemplated by this Agreement occur simultaneously
with the closing of the transactions contemplated by the Other Purchase and
Sale Agreements.

 

7.2.2      Conditions to Purchaser’s Obligations to Close.

 

(1)           Representations and Warranties.
Seller’s representations and warranties contained herein shall be true and
correct in all material respects as of the Effective Date and the Closing Date,
subject to the provisions of Sections 4.4 and 9.3.  Notwithstanding Sections 4.4 and 9.3, Seller
and Purchaser acknowledge and agree that Section 7.2.3 shall apply to any
material change in the representations and warranties of Seller due to any
Updated Property Information or changes that that are not a result of a breach
by Seller or any of its covenants;

 

(2)           Deliveries.  As of the Closing Date, Seller shall have tendered
and shall have caused the Subsidiary to have tendered all deliveries to be made
by Seller and the Subsidiary at Closing;

 

(3)           Actions, Suits, etc.  There shall exist no pending or threatened
actions, suits, arbitrations, claims, attachments, proceedings, assignments for
the benefit of creditors, insolvency, bankruptcy, reorganization or other
proceedings, against Seller or the Subsidiary that would materially and
adversely affect Seller’s ability to perform its obligations under this
Agreement;

 

(4)           Intentionally Deleted.

 

20

 

(5)           Occupancy/Non Bankruptcy.  It shall be a condition to Purchaser’s
obligations to close hereunder that (a) as of the Closing Date, Unisys
shall not have terminated, or given notice of its intent to terminate, its
Lease, except with respect to a Casualty Tenant Termination Event or a
Condemnation Tenant Termination Event and (b) Unisys shall have not
vacated, abandoned or ceased operations at the Real Property, or filed for voluntary
or involuntary bankruptcy or similar protection;

 

(6)           Closing of Fixed Rate Loan, Floating Rate Loan and Mezzanine Loan.  (A) The closing of the
Mezzanine Loan simultaneously with (1) the Closing and (2) the
closing of the Fixed Rate Loan and the Floating Rate Loan and (B) the
closing of the Fixed Rate Loan and the Floating Rate Loan on the Closing Date
(unless the Fixed Rate Loan or the Floating Rate Loan fails to close as a
result of (x) Purchaser’s uncured default under the Fixed Rate Term Sheet
or the Floating Rate Term Sheet, as the case may be, (y) the failure of
one or more conditions to close which are within Purchaser’s reasonable control
to satisfy, or (z) Purchaser’s failure to accept documentation for the
Fixed Rate Loan or the Floating Rate Loan that is commercially reasonable for
such transactions), shall be conditions to Purchaser’s obligation to close
hereunder. Capitalized terms used in this Section 7.2.2(6) and not
defined in this Agreement shall have the meanings ascribed to such terms in the
Portfolio Purchase and Sale Agreement;

 

(7)           Intentionally Deleted;

 

(8)           Title Policy and Non-Imputation Endorsement. It shall be a condition to Purchaser’s obligations to close hereunder
that the Title Company shall have issued the Title Policy (in the form of the
Pro Forma Policy as updated by the Title Company as a result of (i) any
actions taken by Seller which are expressly permitted by the terms of this
Agreement or (ii) any acts or failure to act taken by Purchaser; provided,
however, Purchaser and Seller agree that in no event shall the Title Company’s
failure to deliver the Title Policy in the form of the Pro Forma Policy be a
failure of a condition to Purchaser’s obligation to Close if such failure to
issue the Title Policy in the form of the Pro Forma Policy results from the
Title Company not receiving such documents and instruments, which are (i) required
by the Title Company to issue the Title Policy in the form of the Pro Forma
Policy and (ii) not required to be obtained and delivered by Seller to
Purchaser, the Title Company or otherwise pursuant to the terms of this
Agreement), Co-Insurance and the Non-Imputation Endorsement subject to, and in
accordance with, Section 5.4;

 

(9)           Property. It shall be a condition
to Purchaser’s obligation to close hereunder that neither (x) the NG
Partnership Interests Purchase and Sale Agreement shall have been terminated
with respect to the NG Partnership Interests nor (y) this Agreement, the
Harborside Purchase and Sale Agreement and the Portfolio Purchase and Sale
shall not have been terminated with respect to more than two (2) of the
Acquired Properties (exclusive of the NG Partnership Interests; it being agreed
by Purchaser and Seller that a termination of the NG

 

21

 

Partnership
Interests Purchase and Sale Agreement with respect to the NG Partnership
Interests is addressed in the foregoing clause (x) and that the two (2) Acquired
Properties referenced in the foregoing clause (y) shall not include the NG
Partnership Interests for purposes of the application of the foregoing clause
(y)) (it being understood that a termination of the Portfolio Purchase and Sale
Agreement with respect to one or more of the separate sites constituting the
Goodyear Properties or one or more separate sites constituting the CEVA
Properties shall be deemed in both cases to be a termination of the Portfolio
Purchase and Sale Agreement with respect to only one Portfolio Property
notwithstanding the Lease with The Goodyear Tire & Rubber Company and
the Lease with CEVA Freight, LLC cover multiple Portfolio Properties). For
clarification, the parties agree that it is possible for a closing condition (A) under
the Harborside Purchase and Sale Agreement not to be satisfied (for example, the
bankruptcy of Schwab) which would allow Purchaser not to close and to terminate
with respect to the Harborside Membership Interests but proceed to closing
under this Agreement, the Portfolio Purchase and Sale Agreement and the NG
Partnership Interests Purchase and Sale Agreement or (B) under the NG
Partnership Interests Purchase and Sale Agreement not to be satisfied (for
example, the bankruptcy of Northrop) which would allow Purchaser not to close
and to terminate with respect to the NG Partnership Interests and, as a result
of such termination, there would be a failure of a condition to close under
this Agreement, the Harborside Purchase and Sale Agreement and the Portfolio
Purchase and Sale Agreement which would allow Seller to terminate this Agreement,
Harborside Seller to terminate the Harborside Purchase and Sale Agreement and
Portfolio Seller to terminate the Portfolio Purchase and Sale Agreement;

 

(10)         Termination. A termination of the
officers, directors and managers of the Subsidiary executed by Seller (the “Termination”), effective immediately as of
the Closing; and

 

(11)         Simultaneous Closing.
It shall be a condition to Purchaser’s obligation to close hereunder that the
Closing of the transaction contemplated by this Agreement occur simultaneously
with the closing of the transactions contemplated by the Other Purchase and
Sale Agreements.

 

7.2.3        Failure to Satisfy Conditions.  So long as a party is not in default
hereunder, if any condition to such party’s obligation to proceed with the
Closing hereunder has not been satisfied as of the Closing Date (or such
earlier date as is provided herein), subject to any applicable notice and cure
periods provided in Sections 10.1 and 10.2, such party may, in its sole
discretion either (i) subject to the limitations of Sections 7.2.1(4) and
7.2.2(9)), terminate this Agreement in its entirety by delivering written
notice to the other party and Escrow Agent on or before the Closing Date (or
such earlier date as is provided herein) and thereafter the parties hereto
shall have no further rights or obligations hereunder, except for rights and
obligations which, by their terms, survive the termination hereof, or (ii) elect
to close notwithstanding the non-satisfaction of such condition, in which event
such party shall be deemed to have waived any such condition. In the event such
party elects to close, notwithstanding the non-satisfaction of such condition,

 

22

 

said party shall be deemed
to have waived said condition, and there shall be no liability on the part of
any other party hereto for breaches of representations and warranties of which
the party electing to close had knowledge at the Closing.

 

7.3           Seller’s Deliveries in Escrow.  As of or prior to the Closing Date, Seller
shall deliver, or shall cause the delivery by each Subsidiary, as applicable,
in escrow to Escrow Agent the following:

 

7.3.1        Assignment and Assumption of Membership Interests.  An assignment and assumption of
membership interests in substantially the form of Exhibit B hereto
(the “Assignment and Assumption”);

 

7.3.2        Intentionally Deleted;

 

7.3.3        Conveyancing or Transfer Tax Forms or Returns.  Such conveyancing and transfer
tax forms or returns, if any, as are required to be delivered or signed by Seller
by applicable state and local laws in connection with the transfer of the
Membership Interests;

 

7.3.4        FIRPTA.  A Foreign Investment in Real Property Tax Act
affidavit in the form of Exhibit D hereto executed by iStar;

 

7.3.5        Authority. Evidence of the existence
and authority of Seller and the Subsidiary of the authority of the persons
executing documents on behalf of Seller and the Subsidiary reasonably
satisfactory to First American;

 

7.3.6        Title Affidavits.  A title affidavit in form reasonably required
by First American as to the rights of tenants in occupancy, the status of
mechanics’ liens and “gap” indemnities, and such other matters as the First
American may reasonably require in order to issue the Title Policy and the
Non-Imputation Endorsement (collectively, the “Title Affidavits”);

 

7.3.7        Additional Documents.  Any additional documents that First American
may reasonably require for the proper consummation of the transaction
contemplated by this Agreement (provided, however, no such additional document
shall expand any obligation, covenant, representation or warranty of Seller or
the Subsidiary or result in any new or additional obligation, covenant,
representation or warranty of Seller under this Agreement beyond those
expressly set forth in this Agreement);

 

7.3.8        Tenant Estoppel Certificate.  If received by Seller, the Tenant Estoppel
Certificate, it being agreed that the failure of Seller to obtain the Tenant
Estoppel Certificate shall not (i) be a breach or default by Seller
hereunder, (ii) constitute grounds for Purchaser to delay the Closing or (iii) give
rise to a reduction of the Purchase Price;

 

7.3.9        Third Party Estoppel Certificate.  If received, the Third Party Estoppel
Certificate, it being agreed that the failure of Seller to obtain the Third
Party Estoppel Certificate shall not (i) be a breach or default by Seller
hereunder, (ii) constitute grounds for Purchaser to delay the Closing or (iii) give
rise to a reduction of the Purchase Price;

 

23

 

7.3.10      Searches.  A Uniform Commercial Code Search, indicting
that the membership interests in the Subsidiary are unencumbered by an lien,
encumbrance or other security interest thereon, except for liens, encumbrances
or security interests in favor of GE pursuant to the GE Loan, and federal and
state law searches for Seller and the Subsidiary indicating the absence of any
bankruptcy proceeding, federal or state tax lien, litigation and unsatisfied
judgments;

 

7.3.11      Good Standing Certificates.
A good standing certificate dated within thirty (30) days of the Closing Date
from the Secretary of State of Delaware as to the good standing of the
Subsidiary in the State of Delaware;

 

7.3.12      Insurance Policies.  Copies of all insurance policies maintained
by iStar or Seller on behalf of the Subsidiary;

 

7.3.13      Bringdown Certificate.
A certificate confirming that all of the representations and warranties of
Seller in Section 9.1 are true and accurate as of the Closing Date,
subject to Section 4.4 and the first sentence of Section 9.3;

 

7.3.14      Updated Rent Roll.  A Rent Roll updated to the Closing Date, or
as close as possible;

 

7.3.15      SNDA.  If received by Seller, the SNDA, it being
agreed that the failure of Seller to obtain the SNDA shall not (i) be a
breach or default by Seller hereunder, (ii) constitute grounds for
Purchaser to delay the Closing or (iii) give rise to a reduction of the
Purchase Price;

 

7.3.16      Termination. The executed
Termination;

 

7.3.17      A Past Conduct Certificate.
A Past Conduct Certificate in the form agreed to by Purchaser and Seller and
executed by the Subsidiary; and

 

7.3.18      Membership Certificate.
The original Certificate of Membership Interest of the Subsidiary issued to
Seller and designated certificate no. 1 together with an executed original
Irrevocable Stock Power in blank.

 

7.4           Purchaser’s Deliveries in Escrow.  As of or prior to the Closing Date, Purchaser
shall deliver in escrow to Escrow Agent the following:

 

7.4.1        Assignment and Assumption.
An executed counterpart to the Assignment and 
Assumption;

 

7.4.2        Intentionally Deleted;

 

7.4.3        Conveyancing or Transfer Tax Forms or Returns.  Such conveyancing or transfer
tax forms or returns, if any, as are required to be delivered or signed by
Purchaser by applicable state and local laws in connection with the transfer of
the Membership Interests;

 

24

 

7.4.4        Authority.  Evidence of the existence, organization and
authority of Purchaser and of the authority of the persons executing documents on
behalf of Purchaser reasonably satisfactory to First American;

 

7.4.5        Additional Documents.  Any additional documents that Seller, Escrow
Agent or First American may reasonably require for the proper consummation of
the transaction contemplated by this Agreement (provided, however, no such
additional document shall expand any obligation, covenant, representation or
warranty of Purchaser or result in any new or additional obligation, covenant,
representation or warranty of Purchaser under this Agreement beyond those
expressly set forth in this Agreement); and

 

7.4.6        Bringdown Certificate.  A certificate confirming that all of the
representations and warranties of Purchaser in Section 9.2 are true and
accurate as of the Closing Date.

 

7.5           Closing Statements.  As of or prior to the Closing Date, Seller
and Purchaser shall deposit with Escrow Agent an executed closing statement
with respect to the adjustments herein in the form required by Escrow Agent.  Seller shall provide a draft of the same at
least one week prior to the scheduled Closing Date.

 

7.6           Purchase Price.  At or before 3:00 p.m. (Eastern Time) on
the Closing Date, Purchaser shall deliver to Escrow Agent the Purchase Price
plus or minus applicable prorations and any adjustment to the Purchase Price
made in accordance with the terms of this Agreement, in immediate, same-day
U.S. federal funds wired for credit into Escrow Agent’s escrow account, which
funds must be delivered in a manner to permit Escrow Agent to deliver good
funds to Seller or its designee on the Closing Date (and, if requested by
Seller, by wire transfer); in the event that Escrow Agent is unable to deliver
good funds to Seller or its designee prior to 4:00 p.m. (Eastern Time) on
the Closing Date, then the closing statements and related prorations will be
revised as necessary.

 

7.7           Possession.  As
of Closing, there shall be no change in the Subsidiary’s possession of the
Property.

 

7.8           Delivery of Books and Records.  Within ten (10) Business Days after the
Closing, Seller shall deliver to the offices of Purchaser:  (i) original Lease File; (ii) original
Service Contracts and License Agreements, (iii) to the extent in Seller’s
or the Subsidiary’s possession:  (a) maintenance
records and warranties; (b) plans and specifications; (c) licenses,
permits and certificates of occupancy; (d) copies or originals of all
books and records of account, contracts, and copies of correspondence with
tenants and suppliers; (e) advertising materials; (f) booklets; and (g) keys;
and (iv) the Books and Records.

 

7.9           Notice to Unisys.  Seller and Purchaser shall each execute and
Purchaser shall deliver to Unisys immediately after the Closing, a notice
regarding the sale in substantially the form of Exhibit G hereto,
or such other form as may be required by applicable state law.  This obligation on the part of Purchaser
shall survive the Closing.

 

25

 

ARTICLE 8

PRORATIONS, DEPOSITS, COMMISSIONS

 

8.1           Prorations for Taxes.  To the extent tenants are required to pay
real and personal ad valorem taxes (“Taxes”)
directly under their respective Leases, Taxes will not be prorated, and
accordingly, Purchaser shall look solely to the tenants under their respective
Leases for payment of all Taxes. To the extent tenants are not required to pay
Taxes directly under their respective Leases, then the following shall apply
with respect to the proration of Taxes:

 

8.1.1        If
Taxes for the year of Closing are not known or cannot be reasonably estimated,
Taxes shall be prorated based on Taxes for the year prior to Closing;

 

8.1.2        Any
additional Taxes relating to the year of Closing arising out of a change in
ownership shall be assumed by Purchaser effective as of Closing and paid by
Purchaser when due and payable, and Purchaser shall indemnify Seller from and
against any and all such Taxes, which indemnification obligation shall survive
the Closing; and

 

8.1.3        Purchaser
and Seller shall reasonably cooperate to file all tax returns of the Subsidiary
in respect of the tax year in which the Closing shall occur.

 

8.2           Prorations for Tenant-Paid Operating Expenses.  To the extent tenants are
required to pay operating costs and expenses of the Real Property (“Operating Expenses”) directly under their respective Leases,
which Operating Expenses may include, without limitation, fees and assessments;
prepaid expenses; obligations under Service Contracts; any assessments by
private covenant; insurance; utilities; common area maintenance expenses; and
other operating costs and expenses incurred in connection with the ownership,
operation, maintenance and management of the Real Property, Operating Expenses
will not be prorated, and accordingly, Purchaser shall look solely to the
tenants under such Leases for payment of all Operating Expenses.

 

8.3           Prorations for Non-Tenant Paid Items.  To the extent tenants are not required to pay
Operating Expenses or Taxes directly under their respective Leases, but are
required to escrow Operating Expenses or Taxes under their respective Leases
and/or to reimburse their landlord for all or any portion of such Operating
Expenses or Taxes, then the following items shall be prorated as of the Closing
Date with all items of income and expense for the Property being borne by the
Subsidiary for Purchaser’s account from and after (and including) the Closing
Date and Seller’s account prior to the Closing Date:

 

8.3.1      Utilities.  Purchaser shall take all steps necessary to
post deposits with the utility companies on behalf of the Subsidiary for the
period after the Closing Date. Seller shall ensure that all utility meters are
read as of the Closing Date. Seller shall be entitled to recover any and all
deposits held by any utility company on behalf of the Subsidiary as of the
Closing Date.

 

8.3.2      Tenant Receivables.
Rents due from tenants under Leases and from tenants or licensees under License
Agreements and Operating Expenses and Taxes payable by tenants under Leases and
licenses under License Agreements (collectively, “Tenant Receivables”) and not collected by the Subsidiary as of
Closing shall not be prorated between

 

26

 

Seller and Purchaser at
Closing but shall be apportioned on the basis of the period for which the same
is payable and if, as and when collected, as follows:

 

(a)           Tenant Receivables and other income received
from tenants under Leases, and/or tenants or licensees under License Agreements
after Closing shall be applied in the following order of priority:  (1) first, to payment of the current
Tenant Receivables then due for the month in which the Closing Date occurs,
which amount shall be apportioned between Purchaser and Seller as of the
Closing Date as set forth in Section 8.3 hereof (with Seller’s portion
thereof to be delivered to Seller); (2) second, to payment of Tenant
Receivables first coming due after Closing but applicable to the period of time
before Closing, (collectively, “Unbilled
Tenant Receivables”), which amount shall be delivered to Seller; (3) third,
to Tenant Receivables first coming due after Closing and applicable to the
period of time after Closing, which amount shall be retained by the Subsidiary;
and (4) thereafter, to delinquent Tenant Receivables which were due and
payable as of Closing but not collected by the Subsidiary as of Closing
(collectively, “Uncollected Delinquent Tenant
Receivables”), which amount shall be delivered to Seller.  Notwithstanding the foregoing, Seller shall
have the right to pursue on behalf of the Subsidiary the collection of
Uncollected Delinquent Tenant Receivables for a period of six (6) months
after Closing without prejudice to Seller’s rights or Purchaser’s obligations
hereunder, provided, however, Seller shall have no right to cause the
Subsidiary to cause any such tenant or licensee to be evicted or to exercise
any other “landlord” remedy (as set forth in such tenant’s Lease or licensee’s
License Agreement) against such tenant other than to sue for collection.  Any sums received by the Subsidiary to which
Seller is entitled shall be held in trust for Seller on account of such past
due rents payable to the Subsidiary, and Purchaser shall remit to Seller any
such sums received by the Subsidiary to which Seller is entitled within ten (10) Business
Days after receipt thereof less reasonable, actual costs and expenses of
collection, including reasonable attorneys’ fees, court costs and
disbursements, if any.  Seller expressly
agrees that if Seller receives any amounts after the Closing Date which are
attributable, in whole or in part, to any period from and after the Closing
Date, Seller shall hold the same in trust for the Subsidiary and remit to
Purchaser that portion of the monies so received by Seller to which the
Subsidiary are entitled within ten Business Days after receipt thereof.  With respect to Unbilled Tenant Receivables,
Purchaser covenants and agrees to cause the Subsidiary to (A) bill the
same when billable and (B) cooperate with Seller to determine the correct
amount of operating expenses and/or taxes due. 
Seller shall provide Purchaser with the necessary information to bill
the same when billable and cooperate with Purchaser to maximize collection of the
Unbilled Tenant Receivables.  The provisions
of this Section 8.3.2(a) shall survive the Closing.

 

(b)           Purchaser acknowledges that the Subsidiary as
the landlord under the Leases (and/or as the licensors under the License
Agreements) may be collecting from tenants under the Leases (and/or licensees
under the License Agreements) additional rent relating to Operating Expenses or
Taxes.  To the extent that any such
additional rent is paid by any tenants to the landlord under the Leases (and/or
by any licensees to the licensor under the License Agreements) based on an
estimated payment basis (whether monthly, quarterly, or otherwise) for which a
future reconciliation of actual Operating Expenses or Taxes to estimated
payments of Operating Expenses or Taxes is required to

 

27

 

be performed at the end of a reconciliation period, Purchaser and
Seller shall determine prior to the Closing whether such tenants and/or
licensees have, in the aggregate, made an overpayment or underpayment of
additional rent relating to Operating Expenses or Taxes (such determination to
be based on a comparison of reasonable estimates of actual annual Operating
Expenses and Taxes to the estimated payments being made by such tenants and/or
licensees).  If such determination
indicates that such tenants and/or licensees have made an overpayment of
additional rent relating to Operating Expenses or Taxes, Purchaser shall
receive a credit toward the Purchase Price in the amount of such overpayment
and the Subsidiary shall retain all obligations and liabilities relating to
such overpayment.  If, however, such
determination indicates that such tenants and/or licensees have made an
underpayment of additional rent relating to Operating Expenses or Taxes,
Purchaser shall cause the Subsidiary to bill the tenants for the same promptly
after the Closing and remit the same to Seller as and when collected.  If such review indicates that it cannot be
determined as of the Closing Date whether a tenant has overpaid or underpaid
its additional rent relating to Operating Expenses or Taxes, Purchaser shall
cause the Subsidiary to bill the tenant for the same at the end of the
reconciliation period, and any overpayment with respect to the period prior to
the Closing Date shall be paid by Seller to Purchaser or any underpayment with
respect to the period prior to the Closing Date, when received from the tenant,
shall be paid by Purchaser to Seller. Notwithstanding anything contained herein
to the contrary, to the extent Purchaser, Seller or the Subsidiary receive a
check or wire transfer from any tenant in the exact amount of the item payable
by such tenant or referencing the item to which the check or wire transfer
relates, such check or wire transfer shall be (i) applied directly to the
applicable item or (ii) if such item was previously paid by the Subsidiary
during Seller’s Ownership Period, reimbursed to Seller, or if such item was
paid by the Subsidiary thereafter, reimbursed to Purchaser.

 

8.4           Miscellaneous Prorations.  Without
duplication of, and to the extent not addressed by Sections 8.1, 8.2 and 8.3,
all other items that are customarily subject to proration and adjustment,
including without limitation, “Base Rent”, shall be prorated as of the Closing
Date, it being agreed that for purposes of prorations and adjustments,
Purchaser shall be deemed the owner of the Membership Interests on the Closing
Date.

 

8.5           Leasing Costs. 
Seller agrees to cause the Subsidiary pay or discharge at or prior to
Closing (and provide Purchaser with evidence of payment thereof), or provide
Purchaser with a credit at Closing in the amount of, all leasing commissions,
costs for tenant improvements, lease buyout costs, moving allowances, design
allowances, legal fees and other costs, expenses and allowances incurred in
order to induce a tenant to enter into a Lease or Lease renewal or extension or
to induce a licensee to enter into a License Agreement (collectively, the “Leasing Costs”) that are indicated on Schedule
9.1.5 as being payable by Seller. 
Purchaser agrees to cause the Subsidiary to pay all Leasing Costs
indicated on Schedule 9.1.5 as being payable by
Purchaser as and when they become due. Seller shall have no obligation to pay,
and as of Closing the Subsidiary shall retain, the obligation to pay, all
Leasing Costs payable with respect to any option to renew or option to expand
that has not been exercised prior to the Effective Date, which obligation shall
survive the Closing.  Additionally, as of
Closing, the Subsidiary shall retain all obligations for Leasing Costs incurred
with respect to Leases and Lease renewals

 

28

 

and extensions and License Agreements and License
Agreement renewals and extensions executed subsequent to the Effective Date
pursuant to the terms of this Agreement.

 

8.6           Closing Costs. 
Closing costs shall be allocated between Seller and Purchaser in
accordance with Section 1.2.

 

8.7           Final Adjustment After Closing.  If final bills are not available or cannot be
issued prior to Closing for any item being prorated under Sections 8.1, 8.3 and
8.5, then Purchaser and Seller agree to allocate such items on a fair and
equitable basis as soon as such bills are available, final adjustment to be
made as soon as reasonably possible after the Closing.  Payments in connection with the final
adjustment shall be due within thirty (30) days of written notice.  All such rights and obligations shall survive
the Closing.

 

8.8           Tenant Deposits. All tenant and licensee
security deposits collected and not applied by the Subsidiary (and interest
thereon if required by law or contract) as of the Closing Date shall be
retained by the Subsidiary at Closing. 
As of the Closing, the Subsidiary shall retain their obligations related
to tenant and licensee security deposits, but only to the extent the security
deposits are retained by the Subsidiary at Closing.  Notwithstanding the foregoing provisions of
this Section 8.8, deposits in the form of letters of credit will not be
transferred or credited at the Closing. 
All letters of credit will remain in the name of the Subsidiary at
Closing.  Purchaser and Seller shall each
pay one-half (1/2) of the costs and expenses, if any, of delivering the letters
of credit to Purchaser. In the event that prior to a transfer of any such
letter of credit to Purchaser, Purchaser deems it advisable to cause the
Subsidiary to draw on the same, Seller will cooperate in such presentation, and
direct payment by virtue of any such presentation to the Subsidiary, and if
Seller receives any such payment it will promptly deliver such payment in the
form received and endorsed, without recourse, to Purchaser on behalf of the
Subsidiary.  Purchaser shall defend,
indemnify and hold Seller harmless from all claims, causes of actions, actions,
damages, costs, liabilities and expenses, including (without limitation)
reasonable attorneys’ fees, that may arise out of any such presentation or
related payment, other than by reason of any actions of Seller other than at
the written direction of Purchaser.  If
any security deposit is held in a form other than cash or a letter of credit,
for example, debt or equity securities, at Closing, such debt or equity
securities shall continue to be held by the Subsidiary.

 

8.9           Commissions. 
Seller is responsible to Financial Advisor for a real estate fee at
Closing in accordance with a separate agreement between Seller and Financial
Advisor and at Closing Seller shall pay to Financial Advisor the entire real
estate fee due under the separate agreement between Seller and Financial
Advisor.  Financial Advisor may share its
commission with any other financial advisor or licensed broker involved in this
transaction.  Subject to Seller’s
representations in this Section 8.9, under no circumstances shall Seller
owe a commission or other compensation directly to any financial advisor,
broker, agent or person other than Financial Advisor.  No affiliate, subsidiary or party related in
any way to Purchaser shall claim a commission or fee from Seller or Financial Advisor.  Seller represents and warrants to Purchaser
that no real estate brokerage commission or real estate fee is payable to any
person or entity in connection with the transaction contemplated hereby other
than Financial Advisor, and agrees to and does hereby indemnify and hold
Purchaser harmless against the payment of any commission or real estate fee to
any other person or entity claiming by, through or under Seller including
Financial Advisor. Purchaser represents and warrants to Seller that no real
estate

 

29

 

brokerage commission or real estate fee is payable
to any person or entity in connection with the transaction contemplated hereby,
and agrees to and does hereby indemnify and hold Seller harmless against the
payment of any commission or real estate fee to any other person or entity
claiming by, through or under Purchaser excluding Financial Advisor. The
foregoing indemnifications shall extend to any and all claims, liabilities,
costs and expenses (including reasonable attorneys’ fees and litigation costs)
arising as a result of such claims and shall survive the Closing.

 

8.10         Accounts.  At or prior to Closing, Seller
shall cause all then existing accounts in the name of the Subsidiary to be
closed and the proceeds therein distributed to Seller.

 

8.11         Tax Appeals. 
Subject to the rights of tenants under Leases, following the Closing, (i) Purchaser
shall have the right to pursue on behalf of the Subsidiary all tax appeals in
progress as of the Closing Date which relate to the year of Closing and all
subsequent years and (ii) Seller shall have the right to pursue on behalf
of the Subsidiary all tax appeals in progress as of the Closing Date which
relate to all years prior to the year of Closing (the “Pre-Closing
Tax Appeals”) and any proceeds of the Pre-Closing Tax Appeals shall
be the property of Seller unless such proceeds are required to be paid to the
tenant under the applicable Lease, in which case, Seller shall promptly upon
receipt of such proceeds remit to Purchaser such proceeds less Seller’s
out-of-pocket costs, including, without limitation, reasonable attorney’s fees,
incurred in connection with such Pre-Closing Tax Appeal, but in no event less
than the amounts owed to the tenant under the applicable Lease.  Notwithstanding the foregoing, in no event
shall Seller on behalf of the Subsidiary settle any Pre-Closing Tax Appeal
without the prior consent of Purchaser, not to be unreasonably withheld,
conditioned or delayed, unless Seller is required to settle such Pre-Closing
Tax Appeal on behalf of the Subsidiary pursuant to the terms of the applicable
Lease. If Seller elects not to pursue on behalf of the Subsidiary any
Pre-Closing Tax Appeal, Seller shall so notify Purchaser within a reasonable
period after the Closing, and Purchaser, at its option, may elect to pursue on
behalf of the Subsidiary such Pre-Closing Tax Appeal, unless Purchaser is
required to pursue on behalf of the Subsidiary such Pre-Closing Tax Appeal
pursuant to the terms of the applicable Leases, in which case Purchaser shall
pursue on behalf the Subsidiary such Pre-Closing Tax Appeal.  With respect to (i) any Pre-Closing Tax
Appeal which Seller elects on behalf of the Subsidiary not to pursue and which
Purchaser elects or is obligated on behalf of the Subsidiary to pursue, and (ii) any
tax appeal in progress as of the Closing Date with respect to the year of
Closing, Seller shall cooperate with Purchaser and the Subsidiary, including,
without limitation, substituting counsel, making Seller’s experts available to
Purchaser and the Subsidiary and providing Purchaser with copies of such
appeals and any relevant documentation. The provisions of this Section 8.10
shall survive the Closing.

 

ARTICLE 9

REPRESENTATIONS AND WARRANTIES

 

9.1           Seller’s Representations and Warranties.  Seller represents and warrants to Purchaser
that:

 

9.1.1        Organization and Authority.  Seller and the Subsidiary are validly
existing, and in good standing in the states in which they were was
formed.  Seller has the full right and
authority and has obtained any and all consents required to enter into this
Agreement

 

30

 

and to consummate or cause
the Subsidiary to consummate the transactions contemplated hereby.  This Agreement has been, and all of the
documents to be delivered by Seller and the Subsidiary at the Closing will be,
authorized and executed and constitute, or will constitute, as appropriate, the
valid and binding obligation of Seller and the Subsidiary, enforceable in
accordance with their terms.

 

9.1.2        No Conflicts.  The execution, delivery and performance by
Seller and the Subsidiary, as applicable, of this Agreement and the instruments
referenced herein and the transaction contemplated hereby will not conflict
with, or with or without notice or the passage of time or both, result in a
breach of, violate any term or provision of, or constitute a default under any
articles of formation, bylaws, partnership agreement (oral or written),
operating agreement, indenture, deed of trust, mortgage, contract, agreement,
judicial or administrative order, or any law to which Seller, the Subsidiary,
the Membership Interests or any portion of the Property is bound.

 

9.1.3        Consents; Binding Obligations.  No approval or consent is required from any
person (including any partner, shareholder, member, creditor, investor or
governmental body) for Seller or the Subsidiary, as applicable, to execute,
deliver or perform this Agreement or the other instruments contemplated hereby
or for Seller or the Subsidiary, as applicable, to consummate the transaction
contemplated hereby.  This Agreement and
all documents required hereby to be executed by Seller or the Subsidiary, as
applicable, are and shall be valid, legally binding obligations of and
enforceable against Seller and the Subsidiary in accordance with their terms.

 

9.1.4        Pending Actions. Except as set
forth on Schedule 9.1.4, there is
no action or proceeding pending or threatened against Seller or the Subsidiary
including, but not limited to, those relating to the Membership Interests, the
Subsidiary Agreement, the Real Property, the Improvements, the Leases, the
Guaranties, the Tangible Personal Property or the Intangible Personal Property.

 

9.1.5        Leases, Guaranties, Tenants and Guarantors.  Schedule 1.1.21(2) is a true, correct and complete list
of all Leases, Guaranties, tenants and guarantors in effect as of the Effective
Date.  Seller has delivered, or has
caused the Subsidiary to deliver, or has made available to Purchaser true,
correct and complete copies of  the Leases
and the Guaranties.  To Seller’s
knowledge, no tenant or guarantor of any Lease has been released or discharged,
voluntarily or involuntarily, or by operation of law, from any obligation
related to such Lease.  To Seller’s
knowledge, Seller and the Subsidiary have not received notice of any default
under, and to Seller’s knowledge, no other party is in default under, any of
its obligations under any of the Leases or Guaranties, and to Seller’s
knowledge, there is no event which with the giving of notice or passage of
time, or both, would be a default thereunder. Without limiting the foregoing,
to Seller’s knowledge, Seller and the Subsidiary have not received any notice
from any tenant or guarantor under the Guaranties asserting any presently
accrued defenses, offsets or disputes thereunder. The Rent Roll is true and
correct in all material respects.  Except
as disclosed on Schedule 9.1.5,
there are no Leasing Costs or other obligations to brokers due or which will
become due under any of the Leases, except for Leasing Costs incurred with
respect to Leases and Lease renewals and extensions and License Agreements and
License Agreement renewals and extensions executed subsequent to the Effective
Date pursuant to the terms of this

 

31

 

Agreement. Except as
disclosed on Schedule 9.1.5, all
Leasing Costs have been fully paid and satisfied by Seller, except for Leasing
Costs incurred with respect to Leases and Lease renewals and extensions and
License Agreements and License Agreement renewals and extensions executed
subsequent to the Effective Date pursuant to the terms of this Agreement.

 

9.1.6        Service Contracts and License Agreements.  To Seller’s knowledge, Schedule 9.1.6 is a true, correct and
complete list of all Service Contracts and License Agreements with respect to
the Property.  To Seller’s knowledge,
Seller has delivered or caused the Subsidiary to deliver true, correct and
complete copies of the Service Contracts and License Agreements to
Purchaser.  To Seller’s knowledge, Seller
and the Subsidiary have not received notice of any default under, and to Seller’s
knowledge, no other party is in default under, any of its obligations under any
of the Service Contracts or License Agreements, and to Seller’s knowledge,
there is no event which with the giving of notice or passage of time, or both,
would be a default thereunder.  Without
limiting the foregoing, to Seller’s knowledge, Seller and the Subsidiary have
not received any notice from any party under the Service Contracts or License
Agreements asserting any presently accrued defenses, offsets or disputes
thereunder.

 

9.1.7        Notices
from Governmental Authorities.  To Seller’s knowledge, except as set forth on
Schedule 9.1.7 or as may be reflected
by the Property Documents or otherwise disclosed by Seller to Purchaser in
writing, Seller and the Subsidiary have not received from any governmental authority during the Seller’s Ownership Period
written notice of any violation of any laws, that has not been corrected.

 

9.1.8        Prohibited Persons and Transactions.  Neither Seller nor any of its affiliates is,
nor will they become, a person or entity with whom U.S. persons or entities are
restricted from doing business under regulations of the Office of Foreign Asset
Control (“OFAC”) of the Department
of the Treasury (including those named on OFAC’s Specially Designated and
Blocked Persons List) or under any statute, executive order (including the September 24,
2001, Executive Order Blocking Property and Prohibiting Transactions with
Persons Who Commit, Threaten to Commit, or Support Terrorism), or other
governmental action and is not and will not engage in any dealings or
transactions or be otherwise associated with such persons or entities.

 

9.1.9        Operating Statements.  The Operating Statements delivered by Seller
or made available to Purchaser are true and complete copies of the operating
statements for the Property which Seller and the Subsidiary rely upon for the
purposes of operating the Property.

 

9.1.10      Insurance.  Schedule
9.1.10 is a true, correct and complete list of the insurance
maintained by Seller and the Subsidiary with respect to the Property.  Seller, and the Subsidiary have not received
any written notice or request from any insurance company requesting the performance
of any work or alteration with respect to the Property, which have not been
fully and completely corrected.  Seller
and the Subsidiary have not received written notice from any insurance company
concerning any defects or inadequacies in the Property, which, if not
corrected, would result in the termination of insurance coverage or increase
its cost.

 

9.1.11      Employees.  There are no employees of Seller or the
Subsidiary employed in connection with the use, management, maintenance or
operation of the Property whose

 

32

 

employment will continue
after the Closing Date.  There is no
bargaining unit or union contract relating to any employees of Seller or the
Subsidiary.

 

9.1.12      Third Party Agreements.
Other than the Leases, the License Agreements, the Service Contracts, the
Permitted Exceptions and the agreements set forth on Schedule 9.1.12, there are no agreements to which Seller or
the Subsidiary is party to.  To Seller’s
knowledge, except as set forth on Schedule
9.1.12, Seller is not in default of, and no other party is in
default of, any of its obligations under any of the agreements set forth on Schedule 9.1.12, and there is no event
which, with the giving of notice or passage of time, or both, would be a
default thereunder.

 

9.1.13      Seller’s Representatives.
Seller’s Representatives are the individuals involved in supervising Seller’s
and the Subsidiary’s ownership, operation, and maintenance of the Property,
have knowledge of the operation and maintenance of the Property and have
reviewed the representations of Seller set forth in, and the schedules and
exhibits referenced in, this Section 9.1.13.

 

9.1.14      Ownership.  Seller is the sole member of, and owns one
hundred percent (100%) of the membership interests in, the Subsidiary. Except
for the liens, encumbrances, liabilities, claims, covenants and restrictions
relating to that portion of the GE Loan secured by the Membership Interests and
the Property, which will be repaid, (i) Seller owns its interests in the
Subsidiary free and clear of all liens, encumbrances, liabilities, claims,
covenants and restrictions of any kind or character, including but not limited
to, any security interests or, any restriction on sale or assignment or
granting of any option, right or agreement for the purchase or acquisition of
the same or any interest in the same and Seller has not transferred, assigned,
sold, conveyed, pledged, mortgaged, granted a security interest in, or
otherwise disposed of any of such interests or any portion thereof or interest
therein or granted any option to any person or entity to acquire any of such
interests.

 

9.1.15      Intentionally Deleted.

 

9.1.16      Subleases. Schedule 9.1.16 is a true, correct and
complete list of all subleases covering the Property acknowledged, or consented
to, by Seller and such additional subleases as to which Seller has knowledge
of.

 

9.1.17      Subsidiary Agreement.  Seller has delivered to Purchaser
a true, complete and accurate copies of the Subsidiary Agreement, and all amendments
thereto, all of which are each in full force and effect and have not been
amended or modified, and there has been no material default by Seller or the
Subsidiary under the Subsidiary Agreement (as applicable).

 

9.1.18      Subsidiary.  Other than the Subsidiary, there
are no corporations, partnerships, joint ventures, associations or other
entities in which Seller owns, of record or beneficially, any direct or
indirect equity or other interest or  any
right to acquire same.

 

9.1.19      Books and Records.  The Books and Records contain
accurate records of all meetings and accurately reflect all other actions taken
by the members, boards of directors

 

33

 

and all committees of the
Subsidiary. Complete and accurate copies of all Books and Records of the
Subsidiary have been provided by Seller to the Purchaser.

 

9.1.20      Bankruptcy. No petition in bankruptcy (voluntary or, to Seller’s knowledge,
involuntary), assignment for the benefit of creditors or petition seeking
reorganization or arrangement or other action under federal or state bankruptcy
or insolvency laws is pending against or, to Seller’s knowledge, threatened
against the Subsidiary.

 

9.1.21      Permitted Liabilities.  The Subsidiary has no liabilities
other than (i) those reflected on the consolidated balance sheet of each
respective entity, dated as of March 31, 2010 (collectively, the “Balance Sheets”) and (ii) liabilities
incurred in the ordinary course of the Subsidiary’s business related to the
Property from April 1, 2010 through the Effective Date, which ordinary
course liabilities (A) shall not materially exceed the corresponding line
items for such ordinary course liabilities set forth in the Balance Sheets and (B) are
subject to Purchaser’s consent rights otherwise contained in this Agreement
(items (i) and (ii) of this Section 9.1.19 are referred to
herein collectively as, the “Permitted
Liabilities”), which Permitted Liabilities shall be paid prior to or
at Closing except for Permitted Liabilities prorated in accordance with the
terms of this Agreement.

 

9.1.22      Financial Statements.  Seller has delivered to Purchaser
true, correct and complete copies of the Financial Statements. The Financial
Statements present fairly in all material respects the financial position,
results of operations and cash flows of the Subsidiary as of the dates thereof
and for the periods covered thereby, in accordance with GAAP applied on a
consistent basis.

 

9.1.23      Taxes and Tax Returns.
The Subsidiary does not file federal, state or local tax returns. The taxable
financial results of the Subsidiary are included in the consolidated federal,
state and local tax returns filed by iStar.

 

9.1.24      Undisclosed Liabilities.  There is no basis for any present
action, suit, proceeding, hearing, investigation, charge, complaint, claim or
demand against the Subsidiary  giving
rise to any liability, except for (i) liabilities set forth on the
Financial Statements and (ii) the Permitted Liabilities.

 

9.1.25      Collective Bargaining and Employee Plans. 
Neither Seller nor the Subsidiary is a party to any collective
bargaining or similar agreement with respect to the Property. As of the date
hereof, there are no employee benefit plans or arrangements with respect to the
Subsidiary.

 

9.2           Purchaser’s Representations and Warranties.  Purchaser represents and warrants to Seller
that:

 

9.2.1        Organization and Authority.  Purchaser is validly existing as a limited
liability company in good standing in the State of Delaware. Purchaser has the
full right and authority and has obtained any and all consents required to
enter into this Agreement and to consummate or cause to be consummated the
transactions contemplated hereby, and this Agreement has been, and all of the
documents to be delivered by Purchaser at the Closing will

 

34

 

be, authorized and
properly executed and constitute, or will constitute, as appropriate, the valid
and binding obligation of Purchaser, enforceable in accordance with their
terms.

 

9.2.2        No Conflicts.  The execution, delivery and performance by
Purchaser of this Agreement and the instruments referenced herein and the
transaction contemplated hereby will not conflict with, or with or without
notice or the passage of time or both, result in a breach of, violate any term
or provision of, or constitute a default under any articles of formation,
bylaws, partnership agreement (oral or written), operating agreement,
indenture, deed of trust, mortgage, contract, agreement, judicial or
administrative order, or any law to which Purchaser is bound.

 

9.2.3        Consents; Binding Obligations.  Except as set forth in Section 9.2.1, (a) no
approval or consent is required from any person (including any partner,
shareholder, member, creditor, investor or governmental body) for Purchaser to
execute, deliver or perform this Agreement or the other instruments
contemplated hereby or for Purchaser to consummate the transaction contemplated
hereby, and (b) this Agreement and all documents required hereby to be
executed by Purchaser are and shall be valid, legally binding obligations of
and enforceable against Purchaser in accordance with their terms.

 

9.2.4        Pending Actions.  There is no action or proceeding pending or,
to Purchaser’s knowledge, threatened against Purchaser which challenges or
impairs Purchaser’s ability to execute or perform its obligations under this
Agreement.

 

9.2.5        ERISA.  (a) Purchaser is neither (i) an “employee
benefit plan” (as defined in Section 3(3) of the Employment
Retirement Income Security Act of 1974, as amended (“ERISA”)) which is subject to Title I of ERISA (an “ERISA Plan”), nor (ii) a “plan” (as
defined in Section 4975(e)(1) of the Internal Revenue Code of 1986,
as amended (the “Code”)) which is
subject to Section 4975 of the Code (a “Code
Plan”); (b) the assets of Purchaser do not constitute “plan
assets” (as defined in Section 3(42) of ERISA) of one or more ERISA Plans
or Code Plans (“Plan Assets”)
because, at the time of the Closing, the stock of Purchaser’s parent
constitutes “publicly offered securities” (as defined in 29 C.F.R. Section 2510.3-101(b)(2)),
which parent owns one hundred percent (100%) of the issued and outstanding
equity of Purchaser; (c) Purchaser is not using Plan Assets in the
performance or discharge of its obligations under this Agreement; (d) Purchaser
is not a “governmental plan” (within the meaning of Section 3(32) of
ERISA) and assets of Purchaser do not constitute plan assets of one or more
such plans; and (e) transactions by or with Purchaser are not in violation
of state statutes applicable to Purchaser regulating investments of and
fiduciary obligations with respect to governmental plans.

 

9.2.6        Prohibited Persons and Transactions.  Neither Purchaser nor any of its affiliates
is, nor will they become, a person or entity with whom U.S. persons or entities
are restricted from doing business under regulations of OFAC (including those
named on OFAC’s Specially Designated and Blocked Persons List) or under any
statute, executive order (including the September 24, 2001, Executive
Order Blocking Property and Prohibiting Transactions with Persons Who Commit,
Threaten to Commit, or Support Terrorism), or other governmental action and is
not and will not engage in any dealings or transactions or be otherwise
associated with such persons or entities.

 

35

 

9.2.7        Availability of Funds.  Subject to obtaining the financing
contemplated by the Fixed Rate Term Sheet, the Floating Rate Term Sheet and the
Mezzanine Loan as provided in Section 4.3.2,  Purchaser currently has available and will at the Closing
have available sufficient funds to pay the Purchase Price and to pay any and
all other amounts payable by Purchaser pursuant to this Agreement and to effect
the transactions contemplated hereby.

 

9.3           Survival of Representations and Warranties.  The representations and warranties set forth
in this Article 9 are made as of the Effective Date, are remade as of the
Closing Date (subject to update for Updated Property Information pursuant to Section 4.4
and, changes that are not the result of a breach by Seller or Purchaser or any
of their covenants in this Agreement), and shall not be deemed to be merged
into or waived by the instruments of Closing, but shall survive the Closing for
a period of nine (9) months (the “Survival Period”).  Terms such as “to Seller’s knowledge,” “to the
best of Seller’s knowledge” or like phrases mean the actual knowledge of the
following persons:  Barclay Jones,
Executive Vice President, Michael Dorsch, Executive Vice President, Samantha
Garbus, Senior Vice President, Nancy Zoeckler, Senior Vice President, Mary-Beth
Roselle, Senior Vice President, Scott Quigle, Vice President, Carrie Crain,
Vice President and the persons whose names are set forth on Schedule 9.3 (the foregoing persons are referred to herein
collectively as, the “Seller’s Representatives”),
without any duty of inquiry or investigation except in connection with such
persons’ review of the representations and warranties of Seller set forth in Section 9.1
hereof as provided in Section 9.1.13 hereof; provided that so qualifying
Seller’s knowledge shall in no event give rise to any personal liability on the
part of Seller’s Representatives, or any of them, or any other officer or
employee of Seller, on account of any breach of any representation or warranty
made by Seller herein.  Said terms do not
include constructive knowledge, imputed knowledge or knowledge Seller or such
persons do not have but could have obtained through further investigation or
inquiry.  No financial advisor, broker,
agent, or party other than Seller is authorized to make any representation or
warranty for or on behalf of Seller. 
Subject to Section 9.4 hereof and Sections 9.4 of the Harborside
Purchase and Sale Agreement and the NG Partnership Interests Purchase and Sale
Agreement, each party shall have the right to bring an action against the other
on the breach of a representation or warranty or covenant hereunder or in the
documents delivered by Seller at the Closing, but only on the following
conditions:  (1) the party bringing
the action for breach first learns of the breach after Closing and files such
action within the Survival Period, (2) Seller shall not have the right to
bring a cause of action for a breach of a representation or warranty or
covenant unless the damage to Seller on account of such breach (individually or
when combined with damages from other breaches including damages on account of
breaches by Purchaser under the Other Purchase and Sale Agreements) equals or
exceeds $5,000,000, in which event Purchaser shall be liable to Seller for one-half
of all such damage up to $5,000,000 and for all damage above $5,000,000, and (3) Purchaser
shall not have the right to bring a cause of action for a breach of a
representation or warranty or covenant unless the damage to Purchaser on
account of such breach (individually or in the aggregate) equals or exceeds (i) $1,000,000
if such breach relates to the Property and the Membership Interests, in which
event Seller shall be liable to Purchaser for one-half of all such damage up to
$1,000,000 and for all such damage above $1,000,000 with respect to the
Property and the Membership Interests or (ii) $5,000,000 for the Property,
the Acquired Properties and the Other Real Property, in which event Seller
shall be liable (without duplication of any claims made pursuant to subclause (i) of
this clause (3)) to Purchaser for one-half of all such damage up to $5,000,000
and for all such damage above $5,000,000 with respect to the Property, the
Acquired Properties and the Other Real Property,

 

36

 

subject to the further provisions of this Section 9.3.  Neither party shall have any liability after
Closing for the breach of a representation or warranty or covenant hereunder of
which the other party hereto had actual knowledge as of Closing.  Notwithstanding any other provision of this
Agreement or of any closing deliveries of Seller contemplated by this
Agreement:  (a) subject to Section 9.4
hereof and Sections 9.4 of the Harborside Purchase and Sale Agreement and the
NG Partnership Interests Purchase and Sale Agreement and other than Leasing
Costs, or any rights which Purchaser might otherwise have at law, equity, or by
statute, whether based on contract or some other claim, Purchaser agrees that
any liability of Seller to Purchaser pursuant to this Section 9.3 and any
liability of Other Sellers pursuant to Sections 9.3 of the Other Purchase and
Sale Agreements will in the aggregate be limited to five percent (5%) of the
aggregate Purchase Price of the Acquired Properties and (b) there shall be
no threshold or limitation or limitation on survival on Seller’s obligation to
pay or credit Purchaser for Leasing Costs payable by Seller under Section 8.5
(and the corresponding representation in Section 9.1.5 regarding Leasing
Costs), whether or not the obligations to pay any Leasing Costs first becomes
known to Purchaser before, at or after the Closing; i.e., Seller shall pay or
credit Purchaser for Leasing Costs payable by Seller under Section 8.5
(and the corresponding representation in Section 9.1.5 regarding Leasing
Costs) regardless of the amount thereof and regardless of when the Leasing Cost
becomes known to Purchaser.  In no event
shall either party be liable to the other party for incidental, consequential,
or punitive damages as a result of the breach of any or all representations or
warranties set forth in this Agreement. The provisions of this Section 9.3
shall survive the Closing. Any breach of a representation or warranty or
covenant that occurs prior to Closing shall be governed by ARTICLE 10.

 

9.4           Company Representations.  Anything in
this Agreement to the contrary notwithstanding, including Section 9.3, (i) there
shall be no cap or floor on liability and Purchaser shall not share in such
liability pursuant to Section 9.3, for any misrepresentation or other
breach of any representation or warranty contained in the following subsections
of this Agreement and such subsections shall survive the Closing without
limitation:  Sections 9.1.1, 9.1.2,
9.1.3, 9.1.4, 9.1.14, 9.1.17, 9.1.18, 9.1.20, 9.1.22 and 9.1.23, (ii) there
shall be no cap or floor on liability and the Survival Period shall be two (2) years
from Closing and Purchaser shall not share in such liability pursuant to Section 9.3,
for any misrepresentation or other breach of any representation or warranty
contained in the following subsections of this Agreement:  Sections 9.1.19, 9.1.21 and 9.1.24, and (iii) the
Survival Period for Section 9.1.12 shall be two (2) years from
Closing and remain subject to the caps, floors, and sharing of liability as set
forth in Section 9.3 (items (i), (ii) and (iii) of this Section 9.4
are referred to herein collectively as, the “Company
Representations”), subject to the applicable statues of
limitation.  Seller and iStar (“Indemnitor”) shall each indemnify Purchaser and hold
Purchaser harmless from and against, any and all claims, liabilities, damages,
losses, costs or expenses (including reasonable attorneys’ fees) incurred by
Purchaser arising from the Company Representations.  This Section 9.4 shall survive the
Closing.

 

ARTICLE 10

DEFAULT AND REMEDIES

 

10.1         Seller’s Remedies.  If Purchaser defaults on its obligations
hereunder or under the Other Purchase and Sale Agreements at or prior to
Closing for any reason, or if prior to Closing any one or more of Purchaser’s
representations or warranties or covenants hereunder, or

 

37

 

under the Other Purchase and Sale Agreements, are
breached in any material respect that impairs Purchaser’s ability to close
under this Agreement or under the Other Purchase and Sale Agreements and such
default or breach is not cured by the earlier of the third (3rd) Business Day
after written notice thereof from Seller or the Closing Date (except no notice
or cure period shall apply if Purchaser fails to consummate the purchase of the
Membership Interests hereunder or the other Acquired Properties pursuant to the
Other Purchase and Sale Agreements), Seller shall be entitled, as its sole
remedy hereunder (except as provided in Sections 4.10, 8.8, 10.3 and 10.4
hereof), to terminate this Agreement. 
Notwithstanding anything in this Section 10.1 to the contrary, in
the event of Purchaser’s default or a termination of this Agreement, Seller
shall have all remedies available at law or in equity in the event Purchaser or
any party related to or affiliated with Purchaser is asserting any claims or
right to the Membership Interests or the Property that would otherwise delay or
prevent Seller from having clear, indefeasible and marketable title to the
Membership Interests or the Property.  In
all other events Seller’s remedies shall be limited to those described in this Section 10.1
and Sections 4.10, 8.8, 10.3 and 10.4 hereof. 
If Closing is consummated, Seller shall have all remedies available at
law or in equity in the event Purchaser fails to perform any obligation of
Purchaser under this Agreement. IN NO EVENT SHALL PURCHASER’S DIRECT OR
INDIRECT PARTNERS, SHAREHOLDERS, MEMBERS, MANAGERS, OWNERS OR AFFILIATES, ANY
OFFICER, MANAGER, DIRECTOR, EMPLOYEE OR AGENT OF THE FOREGOING, OR ANY
AFFILIATE OR CONTROLLING PERSON THEREOF HAVE ANY LIABILITY FOR ANY CLAIM, CAUSE
OF ACTION OR OTHER LIABILITY ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE
MEMBERSHIP INTERESTS OR THE PROPERTY, WHETHER BASED ON CONTRACT, COMMON LAW,
STATUTE, EQUITY OR OTHERWISE.

 

10.2         Purchaser’s Remedies. If Seller defaults on its
obligations hereunder, or Other Sellers default in their obligations under the
Other Purchase and Sale Agreements at or prior to Closing for any reason, or if
prior to Closing any one or more of Seller’s, or, with respect to the Other
Purchase and Sale Agreements, Other Sellers’, representations or warranties or
covenants are breached in any material respect (subject to the provisions of Section 4.4
hereof and of the Other Purchase and Sale Agreements and the first Sentence of Section 9.3
hereof and of the Other Purchase and Sale Agreements), and such default or
breach is not cured by the earlier of the third (3rd) Business Day after written
notice thereof from Purchaser or the Closing Date (except no notice or cure
period shall apply if Seller fails to consummate the sale of the Membership
Interests hereunder or Other Sellers fail to consummate the sale of the other
Acquired Properties under the Other Purchase and Sale Agreements), Purchaser
shall elect, as its sole remedy hereunder, either to (a) terminate this
Agreement by giving Seller timely written notice of such election prior to or
at Closing, (b) enforce specific performance to consummate the sale of the
Membership Interests hereunder, or (c) waive said failure or breach and
proceed to Closing without any reduction in the Purchase Price.  Notwithstanding anything herein to the
contrary, Purchaser shall be deemed to have elected to terminate this Agreement
in its entirety if Purchaser fails to deliver to Seller written notice of its
intent to proceed otherwise on or before ten (10) Business Days following
the scheduled Closing Date or, having given notice that it intends to seek specific
performance, fails to file a lawsuit asserting such claim or cause of action in
New York County, New York within two months following the scheduled Closing
Date.  EXCEPT FOR iSTAR’S POTENTIAL
LIABILITY PURSUANT TO THE MEZZANINE LOAN AND SECTION 9.4, IN NO EVENT
SHALL SELLER’S DIRECT OR INDIRECT

 

38

 

PARTNERS, SHAREHOLDERS, MEMBERS, MANAGERS, OWNERS OR
AFFILIATES, ANY OFFICER, MANAGER, DIRECTOR, EMPLOYEE OR AGENT OF THE FOREGOING,
OR ANY AFFILIATE OR CONTROLLING PERSON THEREOF HAVE ANY LIABILITY FOR ANY
CLAIM, CAUSE OF ACTION OR OTHER LIABILITY ARISING OUT OF OR RELATING TO THIS
AGREEMENT, THE MEMBERSHIP INTERESTS OR PROPERTY, WHETHER BASED ON CONTRACT,
COMMON LAW, STATUTE, EQUITY OR OTHERWISE.

 

10.3         Attorneys’ Fees.  In the event either party hereto employs an
attorney in connection with claims by one party against the other arising from
the operation of this Agreement, the non-prevailing party shall pay the
prevailing party all reasonable fees and expenses, including attorneys’ fees,
incurred in connection with such claims.

 

10.4         Other Expenses.  If this Agreement is terminated due to the
default of a party, then the defaulting party shall pay any fees or charges due
to the Title Company for preparation and/or cancellation of the Title
Commitment.

 

ARTICLE 11

DISCLAIMERS, RELEASE AND INDEMNITY

 

11.1         Disclaimers By Seller.  Except as expressly set forth in this
Agreement and/or the Closing documents, it is understood and agreed that Seller
and the Subsidiary and Seller’s and the Subsidiary’s agents or employees have
not at any time made and are not now making, and they specifically disclaim,
any warranties, representations or guaranties of any kind or character, express
or implied, with respect to the Membership Interests, the Property, including,
but not limited to, warranties, representations or guaranties as to (a) matters
of title, (b) environmental matters relating to the Property or any
portion thereof, including, without limitation, the presence of Hazardous
Materials in, on, under or in the vicinity of the Property, (c) geological
conditions, including, without limitation, subsidence, subsurface conditions,
water table, underground water reservoirs, limitations regarding the withdrawal
of water, and geologic faults and the resulting damage of past and/or future
faulting, (d) whether, and to the extent to which the Property or any
portion thereof is affected by any stream (surface or underground), body of
water, wetlands, flood prone area, flood plain, floodway or special flood
hazard, (e) drainage, (f) soil conditions, including the existence of
instability, past soil repairs, soil additions or conditions of soil fill, or
susceptibility to landslides, or the sufficiency of any undershoring, (g) the
presence of endangered species or any environmentally sensitive or protected
areas, (h) zoning or building entitlements to which the Property or any
portion thereof may be subject, (i) the availability of any utilities to
the Property or any portion thereof, including, without limitation, water,
sewage, gas and electric, (j) usages of adjoining property, (k) access
to the Property or any portion thereof, (l) the value, compliance with the
plans and specifications, size, location, age, use, design, quality, description,
suitability, structural integrity, operation, title to, or physical or
financial condition of the Property or any portion thereof, or any income,
expenses, charges, liens, encumbrances, rights or claims on or affecting or
pertaining to the Property or any part thereof, (m) the condition or use
of the Property or compliance of the Property with any or all past, present or
future federal, state or local ordinances, rules, regulations or laws,
building, fire or zoning ordinances, codes or other similar laws, (n) the
existence or non-existence of underground storage tanks, surface impoundments,
or landfills, (o) any other matter affecting the

 

39

 

stability and integrity of the Property, (p) the
potential for further development of the Property, (q) the merchantability
of the Property or fitness of the Property for any particular purpose, (r) the
truth, accuracy or completeness of the Property Documents or Updated Property
Information, (s) tax consequences, or (t) any other matter or thing
with respect to the Property.

 

11.2         Sale “As Is, Where Is”.  Purchaser acknowledges and agrees that upon
Closing, Seller shall sell and convey to Purchaser and Purchaser shall accept
the Membership Interests and all beneficial interests arising therefrom “AS IS, WHERE IS, WITH ALL FAULTS,” except to the extent
expressly provided otherwise in this Agreement and any document executed by
Seller and delivered to Purchaser at Closing. 
Except as expressly set forth in this Agreement or such Closing
documents, Purchaser has not relied and will not rely on, and Seller has not
made and is not liable for or bound by, any express or implied warranties,
guarantees, statements, representations or information pertaining to the
Membership Interests, the Property or relating thereto (including specifically,
without limitation, Property information packages distributed with respect to
the Property) made or furnished by Seller, or any property manager, real estate
broker, financial advisor, agent or third party representing or purporting to
represent Seller, to whomever made or given, directly or indirectly, orally or
in writing.  Purchaser represents that it
is a knowledgeable, experienced and sophisticated purchaser of real estate and
that, except as expressly set forth in this Agreement, it is relying solely on
its own expertise and that of Purchaser’s consultants in purchasing the
Membership Interests and shall make an independent verification of the accuracy
of any documents and information provided by Seller.  Purchaser will conduct such inspections and
investigations of the Membership Interests and the Property as Purchaser deems
necessary, including, but not limited to, the physical and environmental
conditions of the Property, and shall rely upon same. Purchaser acknowledges
that Seller has afforded Purchaser a full opportunity to conduct such
investigations of the Membership Interests and the Property as Purchaser deemed
necessary to satisfy itself as to the Membership Interests and the condition of
the Property and the existence or non-existence or curative action to be taken
with respect to any Hazardous Materials on or discharged from the Property, and
will rely solely upon same and not upon any information provided by or on
behalf of Seller or its agents or employees with respect thereto, other than
such representations, warranties and covenants of Seller as are expressly set
forth in this Agreement.  Upon Closing,
Purchaser shall assume the risk that adverse matters, including, but not
limited to, adverse physical or construction defects or adverse environmental,
health or safety conditions, may not have been revealed by Purchaser’s
inspections and investigations. Purchaser hereby represents and warrants to
Seller that:  (a) Purchaser is
represented by legal counsel in connection with the transaction contemplated by
this Agreement; and (b) Purchaser is purchasing the Membership Interests
for business, commercial, investment or other similar purpose.  Purchaser waives any and all rights or
remedies it may have or be entitled to, deriving from disparity in size or from
any significant disparate bargaining position in relation to Seller.

 

11.3         Seller Released from Liability. Purchaser acknowledges
that it has had the opportunity to inspect the Property and observe its
physical characteristics and existing conditions and the opportunity to conduct
such investigation and study on and of the Property and adjacent areas as
Purchaser deems necessary, and, except as set forth herein or in any Closing
document, Purchaser hereby FOREVER RELEASES AND DISCHARGES Seller from all
responsibility and liability, including without limitation, liabilities and
responsibilities for the landlord’s obligations under the Leases relating to
the physical, environmental or legal

 

40

 

compliance status of the Property, arising after the
Effective Date, and liabilities under the Comprehensive Environmental Response,
Compensation and Liability Act Of 1980 (42 U.S.C. Sections 9601 et seq.), as
amended (“CERCLA”), regarding the condition,
valuation, salability or utility of the Property or its suitability for any
purpose whatsoever (including, but not limited to, with respect to the presence
in the soil, air, structures and surface and subsurface waters, of Hazardous
Materials or other materials or substances that have been or may in the future
be determined to be toxic, hazardous, undesirable or subject to regulation and
that may need to be specially treated, handled and/or removed from the Property
under current or future federal, state and local laws, regulations or
guidelines, and any structural and geologic conditions, subsurface soil and
water conditions and solid and hazardous waste and Hazardous Materials on,
under, adjacent to or otherwise affecting the Property).  Except as set forth herein or in any closing
documents, Purchaser further hereby WAIVES (and by Closing this transaction
will be deemed to have WAIVED) any and all objections and complaints
(including, but not limited to, federal, state and local statutory and common
law based actions, and any private right of action under any federal, state or
local laws, regulations or guidelines to which the Property are or may be
subject, including, but not limited to, CERCLA) concerning the physical
characteristics and any existing conditions of the Property, including, without
limitation, the landlord’s obligations under the Leases relating to the
physical, environmental or legal compliance status of the Property, arising after
the Effective Date.  Purchaser further
hereby assumes the risk of changes in applicable laws and regulations relating
to past, present and future environmental conditions on the Property and the
risk that adverse physical characteristics and conditions, including, without
limitation, the presence of Hazardous Materials or other contaminants, may not
have been revealed by its investigation.

 

11.4         “Hazardous
Materials” Defined.  For purposes hereof, “Hazardous
Materials”“ means “Hazardous Material,” “Hazardous Substance,” “Pollutant
or Contaminant,” and “Petroleum” and “Natural Gas Liquids,” as those terms are
defined or used in Section 101 of CERCLA, and any other substances
regulated because of their effect or potential effect on public health and the environment,
including, without limitation, PCBs, lead paint, asbestos, urea formaldehyde,
radioactive materials, putrescible materials, and infectious materials.

 

11.5         Intentionally Deleted.

 

11.6         Survival.  The terms
and conditions of this ARTICLE 11 shall expressly survive the Closing, and
shall not merge with the provisions of any closing documents.

 

Purchaser
acknowledges and agrees that the disclaimers and other agreements set forth
herein are an integral part of this Agreement and that Seller would not have
agreed to sell the Membership Interests to Purchaser for the Purchase Price
without the disclaimers and other agreements set forth above.

 

ARTICLE 12

MISCELLANEOUS

 

12.1         Parties Bound; Assignment.  This Agreement, and the terms, covenants, and
conditions herein contained, shall inure to the benefit of and be binding upon
the heirs, personal representatives, successors, and assigns of each of the
parties hereto.  Purchaser may, at

 

41

 

Purchaser’s sole cost and expense and at no cost or
expense to Seller, assign its rights under this Agreement upon the following
conditions:  (a) the assignee of
Purchaser must be (i) an entity controlling, controlled by, or under
common control with Purchaser or (ii) an entity advised by an affiliate of
Purchaser’s advisor, Dividend Capital Total Advisors LLC, (b) Intentionally
Deleted, (c) Intentionally Deleted, (d) the assignee of Purchaser
shall assume all obligations of Purchaser hereunder, but Purchaser shall remain
primarily liable for the performance of Purchaser’s obligations, (e) a
copy of the fully executed written assignment and assumption agreement shall be
delivered to Seller at least five (5) Business Days prior to Closing, (f) the
requirements in Section 12.17 are satisfied and (g) such assignment
shall in no event delay the Closing.

 

12.2         Headings.  The
article, section, subsection, paragraph and/or other headings of this Agreement
are for convenience only and in no way limit or enlarge the scope or meaning of
the language hereof.

 

12.3         Invalidity and Waiver.  If any portion of this Agreement is held
invalid or inoperative, then so far as is reasonable and possible the remainder
of this Agreement shall be deemed valid and operative, and, to the greatest
extent legally possible, effect shall be given to the intent manifested by the
portion held invalid or inoperative.  The
failure by either party to enforce against the other any term or provision of
this Agreement shall not be deemed to be a waiver of such party’s right to
enforce against the other party the same or any other such term or provision in
the future.

 

12.4         Governing Law.  This
Agreement shall be governed in all respects, including validity, construction,
interpretation and effect, by the laws of the State of New York, without giving
effect to its principles or rules of conflict of laws to the extent such
principles or rules would require or permit the application of the laws of
another jurisdiction.  Each of Purchaser
and Seller hereby (i) irrevocably submits to the jurisdiction of the
courts of the State of New York and the Federal courts of the United States of
America located in the State, City and County of New York for the purpose of
any action or proceeding arising out of this Agreement or any of the
transactions contemplated by this Agreement, (ii) agrees that it will not
attempt to deny or defeat such personal jurisdiction by motion or other request
for leave from any such court, and (iii) agrees that it will not bring any
action relating to this Agreement or any of the transactions contemplated by
this Agreement in any court other than a New York state court or federal court
located in the State, City and County of New York.  Each of Purchaser and Seller hereby consents
to and grants any such court jurisdiction over the person of such party and
over the subject matter of any such dispute and agrees that mailing of process
or other papers in connection with any such action or proceeding in the manner
provided in Section 12.10, or in such other manner as may be permitted by
law, shall be valid and sufficient service thereof on such party.

 

12.5         Survival.  The
provisions of this Agreement that contemplate performance after the Closing and
the obligations of the parties not fully performed at the Closing (other than
any unfulfilled closing conditions which have been waived or deemed waived by
the other party) shall survive the Closing and shall not be deemed to be merged
into or waived by the instruments of Closing.

 

42

 

12.6         Entirety and Amendments.  The exclusivity obligations and covenants set
forth in that certain letter of intent dated April 2, 2010 between iStar
Financial Inc., on behalf of Seller, and Purchaser are hereby incorporated
herein and made a part of this Agreement. This Agreement embodies the entire
agreement between the parties and supersedes all prior agreements and
understandings relating to the Property. This Agreement may be amended or
supplemented only by an instrument in writing executed by the party against
whom enforcement is sought. All Schedules and Exhibits hereto are incorporated
herein by this reference for all purposes. All information disclosed on any one
Schedule and not disclosed on the other Schedules shall, to the extent
applicable, be deemed to be disclosed on such other Schedules.

 

12.7         Time.  Time is of
the essence in the performance of this Agreement.

 

12.8         Intentionally Omitted.

 

12.9         No Electronic Transactions.  The parties hereby acknowledge and agree this
Agreement shall not be executed, entered into, altered, amended or modified by
electronic means.  Without limiting the
generality of the foregoing, the parties hereby agree the transactions
contemplated by this Agreement shall not be conducted by electronic means,
except as specifically set forth in the “Notices” section of this Agreement.

 

12.10       Notices.  All notices
required or permitted hereunder shall be in writing and shall be served on the
parties at the addresses set forth in Section 1.3.  Any such notices shall, unless otherwise
provided herein, be given or served (a) by depositing the same in the
United States mail, postage paid, certified and addressed to the party to
be notified, with return receipt requested, (b) by overnight delivery
using a nationally recognized overnight courier, (c) by personal delivery,
or (d) by Portable Document Format (PDF) so long as a copy thereof is also
sent by one of the other delivery methods set forth in Sections 12.10(a), (b) or
(c).  Notice given in accordance herewith
for all permitted forms of notice other than by electronic mail, shall be
effective upon the earlier to occur of actual delivery to the address of the
addressee or refusal of receipt by the addressee.  In no event shall this Agreement be altered,
amended or modified by electronic mail or electronic record.  A party’s address may be changed by written
notice to the other party; provided, however, that no notice of a change of
address shall be effective until actual receipt of such notice.  Copies of notices are for informational
purposes only, and a failure to give or receive copies of any notice shall not
be deemed a failure to give notice. 
Notices given by counsel to the Purchaser shall be deemed given by
Purchaser and notices given by counsel to the Seller shall be deemed given by
Seller.

 

12.11       Construction.  The
parties acknowledge that the parties and their counsel have reviewed and
revised this Agreement and agree that the normal rule of construction to
the effect that any ambiguities are to be resolved against the drafting party
shall not be employed in the interpretation of this Agreement or any exhibits
or amendments hereto.

 

12.12       Calculation of Time Periods; Business Day.  Unless otherwise specified, in computing any
period of time described herein, the day of the act or event after which the
designated period of time begins to run is not to be included and the last day
of the period so computed is to be included, unless such last day is not a
Business Day, in which event the period shall run until the end of the next day
which is a Business Day.  The last day of
any period of

 

43

 

time described herein shall be deemed to end at
midnight local time in New York, New York. 
As used herein, the term “Business Day”
means any day that is not a Saturday, Sunday or legal holiday for national
banks in the City of New York, New York or Colorado.

 

12.13       Execution in Counterparts.  This Agreement may be executed in any number
of counterparts, each of which shall be deemed to be an original, and all of
such counterparts shall constitute one Agreement.

 

12.14       Recordation. 
Without the prior written consent of Seller, there shall be no
recordation of either this Agreement or any memorandum hereof, or any affidavit
pertaining hereto, and any such recordation of this Agreement or memorandum or
affidavit by Purchaser without the prior written consent of Seller shall
constitute a default hereunder by Purchaser, whereupon Seller shall have the
remedies set forth in Section 10.1 hereof. 
In addition to any such remedies, Purchaser shall be obligated to
execute an instrument in recordable form releasing this Agreement or memorandum
or affidavit, and Purchaser’s obligations pursuant to this Section 12.14
shall survive any termination of this Agreement as a surviving obligation.

 

12.15       Further Assurances.  In addition to the acts and deeds recited
herein and contemplated to be performed, executed and/or delivered by either
party at Closing, each party agrees to perform, execute and deliver, but
without any obligation to incur any additional liability or expense, on or
after the Closing any further deliveries and assurances as may be reasonably
necessary to consummate the transactions contemplated hereby or to further
perfect the transfer of the Membership Interests to Purchaser.

 

12.16       Discharge of Obligations.  The acceptance of the Membership Interests
Power by Purchaser shall be deemed to be a full performance and discharge of
every representation and warranty made by Seller herein and every agreement and
obligation on the part of Seller to be performed pursuant to the provisions of
this Agreement, except those which are herein specifically stated to survive
Closing.

 

12.17       ERISA.  Under no
circumstances shall Purchaser have the right to assign this Agreement to any
person or entity owned or controlled by an “employee benefit plan” (as defined
in Section 3(3) of ERISA) if Seller’s sale of the Membership
Interests to such person or entity would, in the reasonable opinion of Seller’s
ERISA advisors or consultants, create or otherwise cause a “prohibited
transaction” under ERISA or any other applicable law with an effect similar to
that of Section 406 of ERISA including, but not limited to, Section 4975
of the Code (each such law, a “Similar Law”). In the event Purchaser assigns
this Agreement or transfers any ownership interest in Purchaser, and such
assignment or transfer would make the consummation of the transaction hereunder
a “prohibited transaction” under ERISA or any Similar Law and would therefore
either (a) necessitate the termination of this Agreement, or (b) cause
Seller to incur liability under ERISA or such Similar Law if the transaction
were consummated, then, in either case, notwithstanding any contrary provision
which may be contained herein, Seller shall have the right to terminate this
Agreement and thereafter the parties hereto shall have no further rights or
obligations hereunder, except for rights and obligations which, by their terms,
survive the termination hereof.  Anything
in this Section 12.17 to the contrary notwithstanding, Seller shall have
no right to terminate this Agreement under this

 

44

 

Section 12.17 if Purchaser’s assignee expressly
reaffirms in a writing addressed to Seller the representation in Section 9.2.5.

 

12.18       No Third Party Beneficiary.  The provisions of this Agreement and of the
documents to be executed and delivered at Closing are and will be for the
benefit of Seller and Purchaser only and are not for the benefit of any third
party, and accordingly, no third party shall have the right to enforce the
provisions of this Agreement or of the documents to be executed and delivered
at Closing, except that a tenant of the Property may enforce Purchaser’s
indemnity obligation under Section 4.10 hereof.

 

12.19       Reporting Person.  Purchaser and Seller hereby designate First
American as the “reporting person” pursuant to the provisions of Section 6045(e) of
the Internal Revenue Code of 1986, as amended.

 

12.20       Post-Closing Access.  From and after the Closing, the Purchaser
will, at Seller’s sole cost and expense, permit Seller and Seller’s agents and
representatives access (and will permit copying of materials pertaining to the
period prior to the Closing), during business hours from time to time, to the
Lease Files and other Property-related information upon reasonable advance
notice to the Purchaser.  This Section 12.20
shall survive the Closing.

 

12.21       Waiver of Jury Trial.  SELLER AND PURCHASER HEREBY WAIVE THEIR
RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR
ARISING OUT OF, DIRECTLY OR INDIRECTLY, THIS AGREEMENT OR ANY OF THE RELATED
DOCUMENTS, ANY DEALINGS BETWEEN SELLER AND PURCHASER RELATING TO THE SUBJECT
MATTER OF THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR ANY RELATED
TRANSACTIONS, AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN SELLER
AND PURCHASER.  THE SCOPE OF THIS WAIVER
IS INTENDED TO BE ALL ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE
FILED IN ANY COURT (INCLUDING, WITHOUT LIMITATION, CONTRACT CLAIMS, TORT
CLAIMS, BREACH OF DUTY CLAIMS AND ALL OTHER COMMON LAW AND STATUTORY
CLAIMS).  THIS WAIVER IS IRREVOCABLE,
MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THIS
WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR
MODIFICATIONS TO THIS AGREEMENT, ANY RELATED DOCUMENTS, OR ANY OTHER DOCUMENTS
OR AGREEMENTS RELATING TO THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR
ANY RELATED TRANSACTIONS.  IN THE EVENT
OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL
BY THE COURT.

 

12.22       Information and Audit Cooperation.  Within 75 days after the Closing Date, Seller,
at Purchaser’s sole cost and expense and at no cost or expense to Seller, shall
allow Purchaser’s auditors access to the books and records of Seller relating
to the operation of the Property for the two (2) year period prior to the
Closing Date to enable Purchaser to comply with any financial reporting
requirements applicable to Purchaser, upon at least three (3) Business
Days prior written notice to Seller. In addition, Seller shall provide
Purchaser’s designated

 

45

 

independent auditors a representation letter
regarding the books and records of the Property in substantially the form
attached hereto as Exhibit H.

 

12.23       Bulk Sales Laws12.23.1.
Seller shall (i) comply with the bulk transfer requirements of the state
in which the Property is located, (ii) keep Purchaser apprised of Seller’s
compliance with such requirements and (iii) indemnify, defend and hold
Purchaser harmless of and from any and all liabilities, claims, demands and
expenses of any kind or nature which arise out of the failure of Seller to so
comply with such requirements.

 

[SIGNATURE PAGES, SCHEDULES AND EXHIBITS TO FOLLOW]

 

46

 

SIGNATURE PAGE TO AGREEMENT OF

PURCHASE AND SALE

BY AND BETWEEN

iSTAR CTL HOLDCO LLC,

AS SELLER

AND

TRT ACQUISITIONS LLC,

AS PURCHASER

 

IN
WITNESS WHEREOF, the parties hereto have executed this Agreement on the day and
year written below.

 

PURCHASER:

 

	
  TRT
  ACQUISITIONS LLC, a Delaware limited liability company

  	
   

  
	
   

  	
   

  
	
  By:

  	
  DCTRT
  Real Estate Holdco LLC, Its Sole Member

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Dividend
  Capital Total Realty Operating Partnership LP, Its Sole Member

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Dividend
  Capital Total Realty Trust Inc., Its General Partner

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/
  Greg Moran

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Greg
  M. Moran

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Vice
  President

  	
   

  
	
   

  	
   

  	
  Date:
  June 25, 2010

  	
   

  
						

 

	
  SELLER:

  	
   

  
	
   

  	
   

  
	
  iSTAR
  CTL HOLDCO LLC, a Delaware limited liability company

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/
  Samantha K. Garbus

  	
   

  
	
  Name:

  	
  Samantha
  K. Garbus

  	
   

  
	
  Title:

  	
  Senior
  Vice President

  	
   

  
	
  Date:
  June 25, 2010

  	
   

  
	
   

  	
   

  
	
  AGREED
  TO FOR PURPOSES OF SECTION 4.3.2 AND 9.4:

  	
   

  
	
   

  	
   

  
	
  iSTAR
  FINANCIAL INC., a Maryland corporation

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/
  Samantha K. Garbus

  	
   

  
	
  Name:

  	
  Samantha
  K. Garbus

  	
   

  
	
  Title:

  	
  Senior
  Vice President

  	
   

  
	
  Date:
  June 25, 2010

  	
   

  

 

47Exhibit 10.8

 

FOURTH AMENDMENT TO

PURCHASE AND SALE AGREEMENT

(30 Properties)

 

THIS FOURTH AMENDMENT TO PURCHASE AND SALE AGREEMENT
(this “Amendment”) is made and entered into this 25th day of June, 2010, by and
between Seller and Purchaser.

 

R E C I T A L S:

 

A.                                   Seller and Purchaser have heretofore entered into that certain Purchase
and Sale Agreement, dated as of May 3, 2010, as amended by that certain
First Amendment to Purchase and Sale Agreement, dated as of May 11, 2010,
that certain Second Amendment to Purchase and Sale Agreement, dated as of May 21,
2010 and that certain Third Amendment to Purchase and Sale Agreement, dated as
of June 24, 2010 (as amended, the “Agreement”) relating to the sale and
purchase of the thirty (30) properties described therein. All defined terms in
the Agreement (as amended by this Amendment) are used herein with the same
meanings those terms have in the Agreement (as amended by this Amendment).

 

B.                                     Certain failures of conditions to Purchaser’s obligation to close the
purchase and sale of the McLean, Virginia Property leased by Northrop Grumman
Systems Corporation have occurred (the “Failed Closing Conditions”).

 

C.                                     As a result of the Failed Closing Conditions and notwithstanding anything
contained in the Agreement to the contrary, Seller and Purchaser desire to
amend the Agreement to, among other things, terminate the Agreement with
respect to the McLean, Virginia Property leased by Northrop Grumman Systems
Corporation, on and subject to the terms and conditions of this Amendment.

 

D.                                    Seller and Purchaser desire to amend the Agreement as set forth herein.

 

NOW, THEREFORE, in consideration of these premises, the
terms and conditions contained herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereby covenant and agree as follows:

 

A G R E E M E N T

 

1.                                       Recitals.  The recitals set forth above are hereby
incorporated herein.

 

2.                                       Harborside Purchase and Sale Agreement. Section 1.1.15
of the Agreement is hereby amended and restated in its entirety as follows:

 

“1.1.15            “Harborside Purchase and Sale Agreement”:
That certain Member Interest Purchase and Sale Agreement between Purchaser and
Harborside Seller, dated as of May 3, 2010, as amended by that certain
First Amendment to Member Interest Purchase and Sale Agreement, dated as of May 11,
2010, as further amended by that certain Second Amendment to Member Interest
Purchase and Sale Agreement, 

 

 

dated as of May 21, 2010,
as further amended by that certain Third Amendment to Member Interest Purchase
and Sale Agreement, dated as of June 24, 2010, as further amended by that
certain Fourth Amendment to Member Interest Purchase and Sale Agreement, dated
as of June 25, 2010.”

 

3.                                       Properties. The Agreement is hereby terminated
with respect to  the Property leased by Unisys
Corporation and the Property leased by Northrop Grumman Systems Corporation.
The Agreement, including all Schedules thereto, is hereby amended by deleting
all references to Unisys Corporation, Northrop Grumman Systems Corporation, the
Property leased by Unisys Corporation and the Property leased by Northrop
Grumman Systems Corporation that are currently set forth in the Agreement,
including all Schedules thereto, but prior to giving effect to the terms of
this Amendment. For the avoidance of doubt, this Section 4 shall not apply
to the references to, and terms and provisions regarding, Northrop Grumman
Systems Corporation and the Property leased by Northrop Grumman Systems
Corporation that are added to the Agreement by this Amendment.

 

4.                                       Purchase Price. The Purchase Price, as
defined in Section 1.1.3 of the Agreement, is hereby amended to
$929,100,000.00. Schedule 1.1.3 of the Agreement is hereby amended and restated
in its entirety as set forth on Schedule 1.1.3 attached hereto.

 

5.                                       Definitions.  Section 1.1 of the Agreement is hereby
amended by adding the following at the end thereof:

 

“1.1.17            “NG Partnership Interests Purchase and Sale
Agreement”: That certain Partnership Interests Purchase and Sale Agreement
between Purchaser and NG Partnership Interests Seller, dated as of June 25,
2010 relating to the purchase and sale of the NG Partnership Interests.

 

1.1.18                  “NG Partnership Interests”: One hundred
percent (100%) of the partnership interests in NG LP.

 

1.1.19                  “NG Partnership Interests Seller”:
collectively, iStar NG Inc., a Delaware corporation, and iStar NG GenPar Inc.,
a Delaware corporation.

 

1.1.20                  “CTL Reston Member Interest Purchase and Sale
Agreement”: That certain Member Interest Purchase and Sale Agreement
between Purchaser and iStar CTL Holdco LLC, a Delaware limited liability
company (“CTL Reston Seller”), dated as of June 25,
2010 relating to the purchase and sale of the CTL Reston Membership Interests.

 

1.1.21                  “CTL Reston Membership Interests”: One
hundred percent (100%) of the membership interests in CTL Reston.

 

1.1.22                  “CTL Reston”: iStar CTL Sunset Hills —
Reston LLC, a Delaware limited liability company.

 

 

1.1.23                  “Other Sellers”: collectively, NG
Partnership Interests Seller, CTL Reston Seller and Harborside Seller.

 

1.1.24                  “Other Real Properties”: collectively,
the properties commonly known as 11493 Sunset Hills Road, Reston, Virgina, the
NG Property and Harborside.

 

1.1.25                  “Acquired Interests” collectively, the
NG Partnership Interests, the CTL Reston Membership Interests and the
Harborside Membership Interests.

 

1.1.26                  “Other Purchase and Sale Agreements”:
collectively, the Harborside Purchase and Sale Agreement, the NG Partnership
Interests Purchase and Sale Agreement and the CTL Reston Member Interest
Purchase and Sale Agreement.

 

1.1.27.               “Acquired Properties”: collectively, the
Acquired Interests and the Property.

 

1.1.28                  “Northrop”: Northrop Grumman Systems
Corporation, a Delaware corporation.

 

1.1.29                  “NG Property”: That certain property
commonly known as 7555 Colshire Drive, McLean, Virgina

 

1.1.30                  “NG Lease”: Deed of Lease dated July 27,
1999, as amended, modified and supplemented from time to time, by and between
NG LP, successor-in-interest to West Group Properties LLC, a Virginia limited
liability company, as landlord, and Northrop Grumman Systems Corporation, a
Delaware corporation, successor-in-interest to PRC Inc., a Delaware
corporation, as tenant.

 

1.1.31                  “NG LP”: iStar NG LP, a Delaware limited
partnership.”

 

6.                                       Due Diligence. The second sentence of Section 4.3.1
of the Agreement is hereby amended and restated as follows:

 

“If Purchaser delivers a Due
Diligence Waiver Notice, this Agreement and the Other Purchase and Sale
Agreements shall continue in full force and effect, subject to the provisions
of this Agreement and the Other Purchase and Sale Agreements, including Section 4.3.1
hereof and thereof, and Purchaser shall be deemed to have acknowledged that it
has received or had access to all Property Documents (as defined herein and in
the Other Purchase and Sale Agreements) and conducted all inspections and tests
of the Acquired Properties and the Other Real Properties that it considers
important.”

 

 

7.                                       Financing. Purchaser and Seller
acknowledge and agree that (i) there have been certain modifications to
the Fixed Rate Loan Term Sheet, the Floating Rate Loan Term Sheet and Schedule
4.3.2 to the Agreement and that such modifications will be embodied in the
documents evidencing and securing the Fixed Rate Loan, the Floating Rate Loan
and the Mezzanine Loan, respectively, which documents and instruments are being
executed simultaneously with the execution of this Amendment and (ii) the
properties securing the Fixed Rate Loan and the Floating Rate Loan include (as
applicable) the Properties and the Other Real Properties (exclusive of
Harborside).

 

8.                                       Management Agreements.  The last sentence of Section 4.6 is
hereby amended and restated in its entirety as follows:

 

“Notwithstanding the
foregoing, Seller shall, at its expense, terminate all Service Contracts which
are management agreements, other than with respect to Harborside and the
following described management agreements, all of which Purchaser shall assume
at closing: (1) Property Management Agreement for 5853 Rue Ferrari San
Jose, CA and 5863 Rue Ferrari San Jose, CA between iStar CTL Rue Ferrari - San
Jose LLC, a Delaware limited liability company, and River Rock Real Estate
Group, a California corporation, dated November 1, 2008, (2) Property
Management Agreement for 161  Inverness
Drive West, Englewood, Colorado between iStar CTL Inverness - Englewood LLC, a
Delaware limited liability company (successor to Trinet Realty Investor V, Inc.,
a Maryland corporation), and CB Richard Ellis, Inc., a Delaware
corporation, dated as of August 1, 2005, as amended by Amendment to
Property Management Agreement dated January 25, 2007, and (3) Property
Management Agreement for 2625 Shadelands Drive, Walnut Creek, California
between iStar CTL Shadelands - Walnut Creek LLC, a Delaware limited liability
company (as successor to SFI I, LLC, a Delaware limited liability company), and
Kennedy-Wilson Properties Ltd., an Illinois corporation, dated as of December 1,
2005.”

 

9.                                       Conditions to Seller’s Obligation to Close.

 

(a)                                  Section 7.2.1(4) of the Agreement is hereby amended and
restated in its entirety as follows:

 

“(4)                            Property. It shall be a condition to
Seller’s obligation to close hereunder that neither (x) the NG Partnership
Interests Purchase and Sale Agreement shall have been terminated with respect
to the NG Partnership Interests nor (y) this Agreement, the Harborside
Purchase and Sale Agreement and the CTL Reston Member Interest Purchase and
Sale Agreement shall have been terminated with respect to more than two (2) of
the Acquired Properties (exclusive of the NG Partnership Interests; it being
agreed by Purchaser and Seller that a termination of the NG Partnership
Interests Purchase and Sale Agreement with respect to the NG Partnership
Interests is addressed in the foregoing clause (x) and that the 

 

 

two (2) Acquired Properties referenced in the
foregoing clause (y) shall not include the NG Partnership Interests for
purposes of the application of the foregoing clause (y)) (it being understood
that a termination of this Agreement with respect to one or more of the
separate sites constituting the Properties leased by The Goodyear Tire &
Rubber Company (collectively, the “Goodyear Properties”)
or one or more separate sites constituting the Properties leased by CEVA
Freight, LLC (collectively, the “CEVA Properties”)
shall be deemed in both cases to be a termination of this Agreement with
respect to only one Property notwithstanding the Lease with The Goodyear Tire &
Rubber Company and the Lease with CEVA Freight, LLC cover multiple Properties).
For clarification, the parties agree that it is possible for a closing
condition (A) under the Harborside Purchase and Sale Agreement not to be
satisfied (for example, the bankruptcy of Schwab) which would allow Purchaser
not to close and to terminate with respect to the Harborside Membership
Interests but proceed to closing under this Agreement, the NG Partnership
Interests Purchase and Sale Agreement and the CTL Reston Member Interest
Purchase and Sale Agreement or (B) under the NG Partnership Interests
Purchase and Sale Agreement not to be satisfied (for example, the bankruptcy of
Northrop) which would allow Purchaser not to close and to terminate with
respect to the NG Partnership Interests and, as a result of such termination,
there would be a failure of a condition to close under this Agreement, the
Harborside Purchase and Sale Agreement and the CTL Reston Member Interest
Purchase and Sale Agreement which would allow Seller to terminate this
Agreement, Harborside Seller to terminate the Harborside Purchase and Sale
Agreement and CTL Reston Seller to terminate the CTL Reston Member Interest
Purchase and Sale Agreement.”

 

(b)                                 Section 7.2.1 of the Agreement is hereby amended by adding the
following Section 7.2.1(5) at the end thereof:

 

“(5)                            Simultaneous Closing. It
shall be a condition to Seller’s obligation to close hereunder that the Closing
of the transaction contemplated by this Agreement occur simultaneously with the
closing of the transactions contemplated by the Other Purchase and Sale
Agreements.”

 

10.                                 Conditions to Purchaser’s Obligation to Close.

 

(a)                                  Section 7.2.2(9) of the Agreement is hereby amended and
restated in its entirety as follows:

 

“(9)                            Property.  It shall be a condition to Purchaser’s
obligation to close hereunder that neither (x) the NG Partnership
Interests Purchase and Sale Agreement shall have been terminated with respect
to the NG Partnership Interests nor (y) this Agreement, the Harborside
Purchase and Sale Agreement and the CTL Reston Member Interest Purchase and
Sale 

 

 

Agreement shall have been terminated with respect to
more than two (2) of the Acquired Properties (exclusive of the NG
Partnership Interests; it being agreed by Purchaser and Seller that a
termination of the NG Partnership Interests Purchase and Sale Agreement with
respect to the NG Partnership Interests is addressed in the foregoing clause (x) and
that the two (2) Acquired Properties referenced in the foregoing clause (y) shall
not include the NG Partnership Interests for purposes of the application of the
foregoing clause (y)) (it being understood that a termination of this Agreement
with respect to one or more of the separate sites constituting the Goodyear
Properties or one or more separate sites constituting the CEVA Properties shall
be deemed in both cases to be a termination of this Agreement with respect to
only one Property notwithstanding the Lease with The Goodyear Tire &
Rubber Company and the Lease with CEVA Freight, LLC cover multiple Properties).
For clarification, the parties agree that it is possible for a closing
condition (A) under the Harborside Purchase and Sale Agreement not to be
satisfied (for example, the bankruptcy of Schwab) which would allow Purchaser
not to close and to terminate with respect to the Harborside Membership
Interests but proceed to closing under this Agreement, the NG Partnership
Interests Purchase and Sale Agreement and the CTL Reston Member Interest
Purchase and Sale Agreement or (B) under the NG Partnership Interests
Purchase and Sale Agreement not to be satisfied (for example, the bankruptcy of
Northrop) which would allow Purchaser not to close and to terminate with
respect to the NG Partnership Interests and, as a result of such termination,
there would be a failure of a condition to close under this Agreement, the
Harborside Purchase and Sale Agreement and the CTL Reston Member Interest
Purchase and Sale Agreement which would allow Seller to terminate this
Agreement, Harborside Seller to terminate the Harborside Purchase and Sale
Agreement and CTL Reston Seller to terminate the CTL Reston Member Interest
Purchase and Sale Agreement; and”

 

(b)                                 Section 7.2.2 of the Agreement is hereby amended by adding the
following Section 7.2.2(11) at the end thereof:

 

“(11)                      Simultaneous Closing. It shall be a condition to Purchaser’s obligation
to close hereunder that the Closing of the transaction contemplated by this
Agreement occur simultaneously with the closing of the transactions
contemplated by the Other Purchase and Sale Agreements.”

 

11.                                 Failure to Satisfy Conditions.  Section 7.2.3(b) of the Agreement
is hereby amended and restated as follows:

 

“(b)                         if the condition(s) to close have not been satisfied under Sections
7.2.1(4) and 7.2.2(9) of this Agreement, or where this Agreement
provides for a termination of this Agreement in its entirety, to terminate this
Agreement in its entirety, in each case by delivering written notice to the
other party and Escrow Agent on or before the Closing Date (or such 

 

 

earlier date as is provided
herein), or elect to close notwithstanding the non-satisfaction of such
condition, in which event such party shall be deemed to have waived any such
condition.”

 

12.                                 Survival of Representations and Warranties. Section 9.3
of the Agreement is hereby amended and restated as follows:

 

“9.3                           Survival of Representations and
Warranties. The representations and warranties set forth in
this Article 9 are made as of the Effective Date, are remade as of the
Closing Date (subject to update for Updated Property Information pursuant to Section 4.4
and, changes that are not the result of a breach by Seller or Purchaser or any
of their covenants in this Agreement), and shall not be deemed to be merged
into or waived by the instruments of Closing, but shall survive the Closing for
a period of nine (9) months (the “Survival Period”).  Terms such as “to Seller’s knowledge,” “to the
best of Seller’s knowledge” or like phrases mean, (A) with respect to all
Properties, the actual knowledge of the following persons with respect to all
Properties: Barclay Jones, Executive Vice President, Michael Dorsch, Executive
Vice President, Samantha Garbus, Senior Vice President, Nancy Zoeckler, Senior
Vice President, Mary-Beth Roselle, Senior Vice President, Scott Quigle, Vice
President, and Carrie Crain, Vice President, and (B) with respect to each
Property, the actual knowledge of the applicable persons whose names are set
forth opposite each Property on Schedule 9.3
(the persons identified in the foregoing items (A) and (B) are
referred to herein collectively as, the “Seller’s Representatives”),
without any duty of inquiry or investigation except in connection with such
persons’ review of the representations and warranties of Seller set forth in Section 9.1
hereof as provided in Section 9.1.13 hereof; provided that so qualifying
Seller’s knowledge shall in no event give rise to any personal liability on the
part of Seller’s Representatives, or any of them, or any other officer or
employee of Seller, on account of any breach of any representation or warranty
made by Seller herein.  Said terms do not
include constructive knowledge, imputed knowledge or knowledge Seller or such
persons do not have but could have obtained through further investigation or
inquiry.  No financial advisor, broker,
agent, or party other than Seller is authorized to make any representation or
warranty for or on behalf of Seller. 
Subject to Section 9.4 of the Other Purchase and Sale Agreements,
each party shall have the right to bring an action against the other on the
breach of a representation or warranty or covenant hereunder or in the
documents delivered by Seller at the Closing, but only on the following
conditions: (1) the party bringing the action for breach first learns of
the breach after Closing and files such action within the Survival Period, (2) Seller
shall not have the right to bring a cause of action for a breach of a
representation or warranty or covenant unless the damage to Seller on account
of such breach (individually or when combined with damages from other breaches
including damages on account of breaches by Purchaser under the Other 

 

 

Purchase
and Sale Agreements) equals or exceeds $5,000,000, in which event Purchaser
shall be liable to Seller for one-half of all such damage up to $5,000,000 and
for all damage above $5,000,000, and (3) Purchaser shall not have the
right to bring a cause of action for a breach of a representation or warranty
or covenant unless the damage to Purchaser on account of such breach
(individually or in the aggregate), (i) equals or exceeds (A) $1,000,000
if such breach relates to a Property with an Allocated Purchase Price of less
than $50,000,000, in which event Seller shall be liable to Purchaser for
one-half of all such damage up to $1,000,000 and for all such damage above
$1,000,000 with respect to such Property, or (B) $2,000,000 if such breach
relates to a Property with an Allocated Purchase Price equal to or greater than
$50,000,000, in which event Seller shall be liable to Purchaser for one-half of
all such damage up to $2,000,000 and for all such damage above $2,000,000 with
respect to such Property, or (ii) without duplication of any claims made
pursuant to subclause (i) of this clause (3), equals or exceeds $5,000,000
with respect to the Acquired Properties and the Other Real Property, in which
event Seller shall be liable to Purchaser for one-half of all such damage up to
$5,000,000 and for all such damage above $5,000,000 with respect to the
Acquired Properties and the Other Real Property, subject to the further
provisions of this Section 9.3. 
Neither party shall have any liability after Closing for the breach of a
representation or warranty or covenant hereunder of which the other party
hereto had actual knowledge as of Closing. 
Notwithstanding any other provision of this Agreement or of any closing
deliveries of Seller contemplated by this Agreement: (a) subject to Section 9.4
of the Other Purchase and Sale Agreements and other than the Seller Estoppels
and Leasing Costs, or any rights which Purchaser might otherwise have at law,
equity, or by statute, whether based on contract or some other claim, Purchaser
agrees that any liability of Seller to Purchaser pursuant to this Section 9.3
and any liability of the Other Sellers to Purchaser pursuant to Sections 9.3 of
the Other Purchase and Sale Agreements will in the aggregate be limited to five
percent (5%) of the aggregate Purchase Price of the Acquired Properties and (b) there
shall be no threshold or limitation or limitation on survival on Seller’s
obligation to pay or credit Purchaser for Leasing Costs payable by Seller under
Section 8.5 (and the corresponding representation in Section 9.1.5
regarding Leasing Costs), whether or not the obligations to pay any Leasing
Costs first becomes known to Purchaser before, at or after the Closing; i.e.,
Seller shall pay or credit Purchaser for Leasing Costs payable by Seller under Section 8.5
(and the corresponding representation in Section 9.1.5 regarding Leasing
Costs) regardless of the amount thereof and regardless of when the Leasing Cost
becomes known to Purchaser.  In no event
shall either party be liable to the other party for incidental, consequential,
or punitive damages as a result of the breach of any or all representations or
warranties set forth in this Agreement. 
The provisions of this Section 9.3 shall survive the Closing. Any
breach of a 

 

 

representation
or warranty or covenant that occurs prior to Closing shall be governed by Article 10.”

 

13.                                 Seller’s Remedies. Section 10.1 of
the Agreement is hereby amended and restated in its entirety as follows:

 

“10.1                     Seller’s Remedies.  If Purchaser defaults on its obligations
hereunder, or under the Other Purchase and Sale Agreements, at or prior to
Closing for any reason, or if prior to Closing any one or more of Purchaser’s
representations or warranties or covenants hereunder, or under the Other
Purchase and Sale Agreements, are breached in any material respect that impairs
Purchaser’s ability to close under this Agreement or under the Other Purchase
and Sale Agreements, and such default or breach is not cured by the earlier of
the third (3rd) Business Day after written notice thereof from Seller or the
Other Sellers (as applicable) or the Closing Date (except no notice or cure
period shall apply if Purchaser fails to consummate the purchase of the
Property hereunder or the other Acquired Properties pursuant to the Other
Purchase and Sale Agreements), Seller shall be entitled, as its sole remedy
hereunder (except as provided in Sections 4.10, 8.8, 10.3 and 10.4 hereof), to
terminate this Agreement and recover the Earnest Money as liquidated damages
and not as a penalty, in full satisfaction of claims against Purchaser
hereunder. Seller and Purchaser agree that Seller’s damages resulting from
Purchaser’s default are difficult, if not impossible, to determine and the
Earnest Money is a fair estimate of those damages which has been agreed to in
an effort to cause the amount of such damages to be certain.  Notwithstanding anything in this Section 10.1
to the contrary, in the event of Purchaser’s default or a termination of this
Agreement, Seller shall have all remedies available at law or in equity in the
event Purchaser or any party related to or affiliated with Purchaser is
asserting any claims or right to the Property that would otherwise delay or
prevent Seller from having clear, indefeasible and marketable title to the
Property.  In all other events Seller’s
remedies shall be limited to those described in this Section 10.1 and
Sections 4.10, 8.8, 10.3 and 10.4 hereof. 
If Closing is consummated, Seller shall have all remedies available at
law or in equity in the event Purchaser fails to perform any obligation of
Purchaser under this Agreement. IN NO EVENT SHALL PURCHASER’S DIRECT OR
INDIRECT PARTNERS, SHAREHOLDERS, MEMBERS, MANAGERS, OWNERS OR AFFILIATES, ANY
OFFICER, MANAGER, DIRECTOR, EMPLOYEE OR AGENT OF THE FOREGOING, OR ANY
AFFILIATE OR CONTROLLING PERSON THEREOF HAVE ANY LIABILITY FOR ANY CLAIM, CAUSE
OF ACTION OR OTHER LIABILITY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR
THE PROPERTY, WHETHER BASED ON CONTRACT, COMMON LAW, STATUTE, EQUITY OR
OTHERWISE.”

 

 

14.                                 Purchaser Remedies. Section 10.2 of
the Agreement is hereby amended and restated as follows:

 

“10.2                     Purchaser’s Remedies. If Seller
defaults on its obligations hereunder, or Other Sellers default in their
obligations under the Other Purchase and Sale Agreement, at or prior to Closing
for any reason, or if prior to Closing any one or more of Seller’s, or, with
respect to the Other Purchase and Sale Agreements, Other Sellers’,
representations or warranties or covenants are breached in any material respect
(subject to the provisions of Section 4.4 hereof and of the Other Purchase
and Sale Agreements and the first sentence of Section 9.3 hereof and of
the Other Purchase and Sale Agreements) and such default or breach is not cured
by the earlier of the third (3rd) Business Day after written notice thereof
from Purchaser or the Closing Date (except no notice or cure period shall apply
if Seller fails to consummate the sale of the Property hereunder or the Other
Sellers fail to consummate the sale of the other Acquired Properties pursuant
to the Other Purchase and Sale Agreements), Purchaser shall elect, as its sole
remedy hereunder, either to (a) terminate this Agreement in its entirety
by giving Seller timely written notice of such election prior to or at Closing
and recover the Earnest Money, in which event Seller shall be liable to
Purchaser for its out of pocket expenses incurred in connection with the
transaction contemplated hereby, but not to exceed $1,700,000.00 plus such
all-in rate lock costs (including, without limitation, swap and credit spreads)
as Purchaser may have incurred in connection with the loan contemplated by the
Fixed Rate Loan Term Sheet, (b) terminate this Agreement in part with
respect to the Properties with respect to which Seller’s representations or
warranties or covenants are breached (subject to Sections 7.2.1(4) and
7.2.2(9)), in which event the Purchase Price shall be reduced by the Allocated
Purchase Price for such Properties, (c) enforce specific performance to
consummate the sale of the Property hereunder, or (d) waive said failure
or breach and proceed to Closing without any reduction in the Purchase
Price.  Notwithstanding anything herein
to the contrary, Purchaser shall be deemed to have elected to terminate this
Agreement in its entirety if Purchaser fails to deliver to Seller written
notice of its intent to proceed otherwise on or before ten (10) Business
Days following the scheduled Closing Date or, having given notice that it
intends to seek specific performance, fails to file a lawsuit asserting such
claim or cause of action in New York County, New York within two months
following the scheduled Closing Date. 
EXCEPT FOR iSTAR’S POTENTIAL LIABILITY PURSUANT TO THE SELLER ESTOPPELS
AND/OR THE MEZZANINE LOAN, IN NO EVENT SHALL SELLER’S DIRECT OR INDIRECT
PARTNERS, SHAREHOLDERS, MEMBERS, MANAGERS, OWNERS OR AFFILIATES, ANY OFFICER,
MANAGER, DIRECTOR, EMPLOYEE OR AGENT OF THE FOREGOING, OR ANY AFFILIATE OR
CONTROLLING PERSON THEREOF HAVE ANY LIABILITY FOR ANY CLAIM, CAUSE OF ACTION OR
OTHER LIABILITY ARISING 

 

 

OUT OF OR RELATING TO THIS AGREEMENT OR THE
PROPERTY, WHETHER BASED ON CONTRACT, COMMON LAW, STATUTE, EQUITY OR OTHERWISE.”

 

15.                                 Resolution. The Agreement is hereby
amended by adding the following Article 13 at the end thereof:

 

“ARTICLE 13

RESOLUTION
FEE, RESOLUTION PAYMENT

AND
RESOLUTION ESCROW

 

13.1                           Resolution Fee.  If the Resolution is not obtained prior to
Closing, at Closing iStar shall pay, on behalf of Seller and the Other Sellers,
or cause Seller and the Other Sellers to pay, Purchaser’s designee an amount
equal to $4,300,000.00 from the proceeds of the sale of the Acquired Properties
pursuant to this Agreement and the Other Purchase and Sale Agreements.

 

13.2                             Resolution
Payment. If the Resolution is not obtained prior to Closing, but
is obtained within fifty (50) days following the Closing Date (the “Resolution Expiration Date”), Purchaser shall pay to iStar,
on behalf of Seller and the Other Sellers, an amount equal to Two Million and
00/100 Dollars ($2,000,000.00) (the “Resolution Payment”)
by wire transfer of immediately available funds to an account designated by
iStar within five (5) Business Days of the date on which the Resolution is
obtained (the “Resolution Date”).  Subject to Section 13.5 below, if the Resolution
is not obtained on or before the Resolution Expiration Date, Purchaser shall
have no obligation to pay iStar the Resolution Payment.

 

13.3                           Resolution Escrow. If the Resolution is not obtained prior to Closing, at Closing Escrow
Agent (1) shall withhold Five Million and 00/100 Dollars ($5,000,000.00)
(the “Resolution Escrow Amount”) from the
aggregate purchase price for the Acquired Properties payable under this
Agreement and the Other Purchase and Sale Agreements, and (2) shall (x) immediately
deposit the Resolution Escrow Amount in government insured interest-bearing
accounts satisfactory to iStar, on behalf of Seller and the Other Sellers, and
Purchaser (the “Resolution Escrow Account”), (y) not
commingle the Resolution Escrow Amount with any funds of Escrow Agent or
others, and (z) promptly provide Purchaser and iStar, on behalf of Seller
and the Other Sellers, with confirmation of the investments made. If the
Resolution is obtained on or before the Resolution Expiration Date, Escrow
Agent shall disburse the Resolution Escrow Amount to iStar, on behalf of Seller
and the Other Sellers, within two (2) Business Days of the date on which
Escrow Agent receives a joint order executed by iStar, on behalf of Seller and
the Other Sellers, and Purchaser setting forth the Resolution Date and
directing the disbursement of the Resolution Escrow Amount to iStar, on behalf
of Seller and the Other Sellers. Subject to Section 13.5 below, if the
Resolution is not obtained on or before the Resolution Expiration Date, Escrow
Agent shall disburse the Resolution Escrow Amount to Purchaser within two (2) 

 

 

Business
Days of the date on which Escrow Agent receives a joint order executed by
iStar, on behalf of Seller and the Other Sellers, and Purchaser stating that
the Resolution was not obtained on or before the Resolution Expiration Date and
directing the disbursement of the Resolution Escrow Amount to Purchaser.

 

13.4.                        Resolution.  “Resolution”
means the first to occur of the following:

 

(a)                                  Northrop’s
execution and delivery of either (a) an acknowledgment with respect to the
Right of First Offer to Negotiate set forth in Rider 2 to the NG Lease (the “NG ROFO Provision”) stating any of the following with
respect to (i) the transactions contemplated by this Agreement as in
effect on May 3, 2010 and the Partnership Interests Purchase and Sale
Agreement and (ii) a one-time transfer of the NG Property from NG LP to an
affiliate of NG LP to accommodate lender requirements in connection with
financing the NG Property: the NG ROFO Provision has not been triggered, it is
not operable, it has been waived by Northrop or NG LP has no further obligation
thereunder (the “ROFO Acknowledgement”); or (b) a
Tenant Estoppel Certificate (as defined in the NG Partnership Interests
Purchase and Sale Agreement) containing a ROFO Acknowledgement; or

 

(b)                                 Northrop’s or any affiliate of Northrop’s execution of any lease
modification, letter agreement, purchase contract or other agreement that
provides (1) (A) that the ROFO Provision does not apply for any
reason to a one-time transfer of the NG Property from NG LP to an affiliate of
NG LP to accommodate lender requirements in connection with financing the NG
Property, and (B) among other things, (i) that the NG ROFO Provision
does not apply for any reason to the transaction contemplated by the NG
Partnership Interests Purchase and Sale Agreement or the transaction
contemplated by this Agreement as in effect on May 3, 2010, or (ii) that
Northrop waives the application of the NG ROFO Provision to the transaction
contemplated by the NG Partnership Interests Purchase and Sale Agreement or the
transaction contemplated by this Agreement as in effect on May 3, 2010, or
(iii) that Northrop will not take any action against NG Partnership
Interests Seller, NG LP and/or Purchaser based on the application of the NG
ROFO Provision to the transaction contemplated by the NG Partnership Interests
Purchase and Sale Agreement or the transaction contemplated by this Agreement
as in effect on May 3, 2010, or (2) for a full release of iStar,
Seller, NG Partnership Interests Seller, NG LP, Purchaser, TRT NOIP Colshire —
McLean LLC and TRT NOIP Colshire — McLean GP LLC and such other terms and
conditions which have been approved by iStar, on behalf of Seller and the Other
Sellers, and Purchaser.

 

13.5                           Fixed Rate Transfer. If (A) the Resolution is not obtained on or prior to the
Resolution Expiration Date, but the Resolution is obtained within forty (40)
days following the Resolution Expiration Date (the “Extended
Resolution Expiration Date”), and (B) the NG Property is
transferred by Fixed Rate Lender and Floating Rate Lender to the pool of
Properties securing the Fixed 

 

 

Rate
Loan (the “Fixed Rate Transfer”) on or before
the Extended Resolution Expiration Date, then Purchaser shall pay to iStar, on
behalf of Seller and the Other Sellers, the Resolution Payment and the
Resolution Escrow Amount by wire transfer of immediately available funds to an
account designated by iStar within five (5) Business Days of the later to
occur of (x) the Resolution Date and (y) the date on which the Fixed
Rate Transfer occurs. Purchaser agrees to use, and Purchaser agrees to cause
its affiliates to use, good faith efforts to cause the Fixed Rate Transfer to
occur on or before the Extended Resolution Date.

 

13.6         Indemnity Agreement. If the Resolution is not obtained prior to
Closing, at Closing Purchaser and iStar shall each execute and deliver an
indemnity agreement that sets forth, among other things, the rights and
obligations of iStar on the one hand, and Purchaser, Dividend Capital Total
Realty Trust Inc., Dividend Capital Total Realty Operating Partnership LP and
NG LP, on the other hand, with respect to obtaining the Resolution.

 

13.7                           Survival.  This Article 13 shall survive the
Closing.”

 

16.                                 Counterparts; Facsimile.  This Amendment may be executed and delivered
in any number of counterparts, each of which so executed and delivered shall be
deemed to be an original and all of which shall constitute one and the same
instrument.  For purposes of this
Amendment, any signature transmitted by facsimile or e-mail (in pdf format)
shall be considered to have the same legal and binding effect as any original
signature.

 

17.                                 Ratification. The Agreement, as amended
hereby, remains in full force and effect and is hereby ratified and confirmed.

 

[Remainder
of Page Intentionally Left Blank;

Signature Page Follows]

 

 

IN WITNESS WHEREOF, Purchaser and Seller have executed
this Amendment as of the date set forth above.

 

PURCHASER:

 

TRT ACQUISITIONS LLC, a Delaware
limited liability company

 

	
  By:

  	
  DCTRT Real Estate Holdco LLC, Its Sole Member

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Dividend Capital Total Realty Operating Partnership
  LP, Its Sole Member

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Dividend Capital Total Realty Trust Inc., Its
  General Partner

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Greg Moran

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  	
   

  

 

SELLER:

 

iSTAR CTL SOUTH HAVANA —
ENGLEWOOD LLC, a Delaware limited liability
company

 

iSTAR CTL WATERVIEW — DALLAS LLC, a Delaware limited liability company

 

iSTAR CTL SHADELANDS — WALNUT
CREEK LLC, a Delaware limited liability
company

 

iSTAR CTL NORTH GLENVILLE —
RICHARDSON LLC, a Delaware limited liability
company

 

iSTAR CTL SHEILA — COMMERCE LLC, a Delaware limited liability company

 

iSTAR CTL COLUMBIA — RICHFIELD
LLC, a Delaware limited liability company

 

iSTAR CTL COTTONWOOD — MILPITAS
LLC, a Delaware limited liability company

 

iSTAR CTL NORTH FAIRWAY DRIVE —
VERNON HILLS LLC, a Delaware limited liability
company

 

iSTAR CTL DOOLITTLE — REDONDO
BEACH LLC, a Delaware limited liability
company

 

 

iSTAR CTL CROWN COLONY — QUINCY
LLC, a Delaware limited liability company

 

iSTAR CTL RUE FERRARI — SAN JOSE
LLC, a Delaware limited liability company

 

iSTAR CTL CORPORATE CENTER DRIVE
— NEWBURY PARK LLC, a Delaware limited liability
company

 

iSTAR CTL COLUMBIA — CAMPBELLSVILLE
LLC, a Delaware limited liability company

 

iSTAR CTL SUNSET HILLS — RESTON
LLC, a Delaware limited liability company

 

iSTAR CTL EAGLE LLC, a Delaware limited liability company

 

iSTAR CTL SYLVAN WAY — PARSIPPANY
LLC, a Delaware limited liability company

 

iSTAR CTL INVERNESS — ENGLEWOOD
LLC, a Delaware limited liability company

 

iSTAR CTL CORPORATE DRIVE — DIXON
LLC, a Delaware limited liability company

 

iSTAR CTL CONNECTION — IRVING LLC, a Delaware limited liability company

 

iSTAR CTL CHARLESTON — MOUNTAIN
VIEW LLC, a Delaware limited liability
company

 

iSTAR CTL DUBLIN LLC, a Delaware limited liability company

 

iSTAR GT, L.P., a Delaware limited partnership

 

iSTAR NG LP, a Delaware limited partnership

 

iSTAR CTL MAPLE — EL SEGUNDO LLC, a Delaware limited liability company

 

 

iSTAR CTL SW 80 — PLANTATION LLC, a Delaware limited liability company

 

 

	
  By:

  	
  /s/
  Samantha K. Garbus

  	
   

  
	
  Name:

  	
  Samantha
  K. Garbus

  	
   

  
	
  Title:

  	
  Senior
  Vice President

  	
   

  

 

AGREED TO FOR PURPOSES OF SECTION 4.3.2 AND ARTICLE 13:

 

iSTAR FINANCIAL INC., a Maryland corporation

 

	
  By:

  	
  /s/
  Samantha K. Garbus

  	
   

  
	
  Name:

  	
  Samantha
  K. Garbus

  	
   

  
	
  Title:

  	
  Senior
  Vice President

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