Document:

EXHIBIT 4(b)(15)

UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN CERTIFICATED
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (55 WATER STREET, NEW YORK, NEW YORK) TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS
MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL, SINCE THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.

REGISTERED                                                  $[   ]

No. FL-001                                                  CUSIP # [ ]

                         THE BEAR STEARNS COMPANIES INC.

                           MEDIUM-TERM NOTE, SERIES B
                                 (FLOATING RATE)

Original Issue Date: January 6, 2005          Interest Reset Date(s): *

Maturity Date: January 6, 2020                Interest Reset Period: Quarterly

Interest Rate Basis:  Other. See
"Interest Rate" below.                        Interest Determination
                                                 Date(s):  Fifth Business Day
Initial Interest Rate:  See                      prior to but not including
"Interest Rate" below.                           the applicable Interest
                                                 Reset Date.
Index Maturity:  N/A

Spread (plus or minus):  N/A                  Day Count Basis: 360-day year
                                                 of twelve 30-day months
Maximum Interest Rate: N/A

Minimum Interest Rate:  0.00%                 Interest Payment Date(s): **

                                              Interest Payment Period: Quarterly

                                              Redeemable On and After:  ***

                                              Optional Repayment Date(s): N/A

Minimum Denominations: $100,000, increased in multiples of $10,000

*     Commencing April 6, 2005 and on each July 6th, October 6th, January 6th
      and April 6th thereafter prior to Maturity. If any Interest Reset Date is
      not a Business Day, then the Interest Reset Date will be postponed to the
      next Business Day. If the next Business Day is in the next

<PAGE>

      succeeding calendar month, the Interest Reset Date will be the preceding
      Business Day (any such adjustment being referred to as the "Modified
      Business Day Convention").

**    Commencing April 6, 2005 and on each July 6th, October 6th, January 6th
      and April 6th thereafter, including the Maturity Date.

***   Commencing April 6, 2005 and on each Interest Payment Date thereafter
      until Maturity, the Notes may be called in whole at par at the option of
      the Company on five New York Business Days' notice.

If any Interest Payment Date, Maturity Date or Redemption Date is not a Business
Day, the related payment of principal, premium, if any, or interest will be
postponed to the next Business Day and no additional interest shall accrue for
the period from and after that Interest Payment Date, Maturity Date or
Redemption Date, as the case may be, to the next Business Day. If the next
Business Day is in the next calendar month, principal, premium, if any, or
interest will be paid on the preceding Business Day.

Business Day:                 Any day that is both a London Banking Day and a
                              New York Business Day.

London Banking Day:           A day other than a Saturday or Sunday on which
                              dealings in deposits in U.S. dollars are
                              transacted, or with respect to any future date
                              are expected to be transacted, in the London
                              interbank market.

New York Business Day:        Any day that is not a Saturday
                              or Sunday, and that, in New York City, is not a
                              legal holiday nor a day on which banking
                              institutions or trust companies in New York City
                              are authorized or obligated by law to close.

Interest Rate:                USD Callable CMS Spread
                              Principal Protected Range Accrual Note.

                              The Calculation Agent will determine the Interest
                              Rate for each Interest Payment Period in
                              accordance with the following:

                              For each Interest Payment Period from the Original
                              Issue Date through January 5, 2010, the Interest
                              Rate shall equal:

                                              /       n \
                                              |7.00%x---|
                                              \       N /

                              For each Interest Payment Period from January 6,
                              2010 through January 5, 2015, the Interest Rate
                              shall equal:

                                              /       n \
                                              |9.00%x---|
                                              \       N /

                                      -2-
<PAGE>

                              For each Interest Payment Period from January 6,
                              2015 until the Maturity Date, the Interest Rate
                              shall equal:

                                              /        n \
                                              |18.00%x---|
                                              \        N /

                              Where n equals the number of days in the
                              respective Interest Payment Period in which the
                              Accrual Provision is satisfied, and N equals the
                              actual number of days in the respective Interest
                              Payment Period. See "Accrual Provision" below.

Accrual Provision:            Interest will accrue (at the rate per annum under
                              Interest Rate above for each Interest Payment
                              Period) on each day on which the 30-Year CMS Rate
                              minus the 10-Year CMS Rate for the relevant
                              Accrual Determination Date is equal to or greater
                              than 0% (such calculation referred to as the
                              "Accrual Provision").  If however, the difference
                              of the 30-Year CMS Rate minus the 10-Year CMS
                              Rate for any Accrual Determination Date is less
                              than 0%, then no interest will accrue for any day
                              relating to such Accrual Determination Date.  No
                              determination as to satisfaction of the Accrual
                              Provision will be made with respect to the
                              Exclusion Period (as defined below).  The
                              determination with respect to each day of an
                              Exclusion Period will be deemed to have been made
                              on the last New York Business Day prior to such
                              Exclusion Period.

Accrual Determination Date:   A determination as to whether the Accrual
                              Provision has been satisfied will be made on each
                              Accrual Determination Date.  Each New York
                              Business Day during an Interest Payment Period
                              will be an Accrual Determination Date, provided
                              that such New York Business Day is not within the
                              Exclusion Period.  For each day during an
                              Interest Payment Period that is not a New York
                              Business Day and not within the Exclusion Period,
                              the Accrual Determination Date will be the
                              preceding New York Business Day.  The Exclusion
                              Period means the period beginning on the fifth
                              New York Business Day prior to but not including
                              the last day of the current Interest Payment
                              Period.

30-Year CMS Rate:             The rate in effect for each Interest Payment
                              Period will be the rate that appears on Reuters
                              page ISDA FIX1 under the heading "30YR" at 11:00
                              a.m., New York City time on the Interest
                              Determination Date for that Interest Payment
                              Period.  If such rate does not appear on Reuters
                              page ISDA FIX1 on such date, the rate for such
                              date shall be determined as if the parties had
                              specified "USD-CMS-Reference Banks" as the
                              applicable rate.

                                      -3-
<PAGE>

10-Year CMS Rate:             The rate in effect for each Interest Payment
                              Period will be the rate that appears on Reuters
                              page ISDA FIX1 under the heading "10YR" at 11:00
                              a.m., New York City time on the Interest
                              Determination Date for that Interest Payment
                              Period.  If such rate does not appear on Reuters
                              page ISDA FIX1 on such date, the rate for such
                              date shall be determined as if the parties had
                              specified "USD-CMS-Reference Banks" as the
                              applicable rate.

USD-CMS-Reference Banks:      The rate determined on the basis of the
                              mid-market semi-annual swap rate quotations
                              provided by the Reference Banks at approximately
                              11:00 a.m., New York City time on any Interest
                              Determination Date; and for this purpose, the
                              semi-annual swap rate means the mean of the bid
                              and offered rates for the semi-annual fixed leg,
                              calculated on a 30/360 day count basis, of a
                              fixed-for-floating U.S. Dollar interest rate swap
                              transaction with a term equal to the Designated
                              Maturity commencing on that date and in a
                              Representative Amount with an acknowledged dealer
                              of good credit in the swap market, where the
                              floating leg, calculated on an actual/360 day
                              count basis, is equivalent to USD-LIBOR-BBA with
                              a designated maturity of three months.  The rate
                              for that Interest Determination Date will be the
                              arithmetic mean of the quotations, eliminating
                              the highest quotation (or, in the event of
                              equality, one of the highest) and the lowest
                              quotation (or, in the event of equality, one of
                              the lowest).

Reference Banks:              The five leading swap dealers in the New York
                              City interbank market selected by the Calculation
                              Agent for the purposes of providing quotations as
                              provided above.

Designated Maturity:          Either 30 years or 10 years, as the case may be.

Representative Amount:        The amount that is representative for a single
                              transaction in the relevant market at the
                              relevant time.

Calculation Agent:            Bear, Stearns & Co. Inc.

      THE BEAR STEARNS COMPANIES INC., a Delaware corporation (the "Company"),
for value received, hereby promises to pay to CEDE & CO., or registered assigns,
the principal amount stated above on the Maturity Date shown above (the
"Maturity Date") and to pay interest thereon at the rate per annum equal to the
Initial Interest Rate shown above until the first Interest Reset Date shown
above following the Original Issue Date shown above and thereafter at a rate
determined (unless otherwise specified on the face hereof) in accordance with
the provisions on the reverse hereof under the heading "Determination of
Commercial Paper Rate," "Determination of LIBOR," "Determination of Federal
Funds Rate," "Determination of Treasury Rate," "Determination of Prime Rate" or
"Determination of CMT Rate" depending upon whether the Interest Rate Basis is
Commercial Paper Rate, LIBOR, Federal Funds Rate, Treasury Rate, Prime Rate or
CMT Rate, as

                                      -4-
<PAGE>

indicated above, until the principal hereof is fully paid or duly made available
for payment. The Company will pay interest monthly, quarterly, semiannually or
annually as indicated above on each Interest Payment Date shown above commencing
with the first Interest Payment Date shown above immediately following the
Original Issue Date shown above, and on the Maturity Date or, if applicable, the
Redemption Date or Optional Repayment Date; provided, however, that if the
Original Issue Date shown above is between a Regular Record Date (as defined
below) and an Interest Payment Date, interest payments will commence on the
Interest Payment Date following the next succeeding Regular Record Date; and
provided, further, however, that if an Interest Payment Date, Maturity Date,
Redemption Date or Optional Repayment Date would fall on a day that is not a
Business Day (as defined on the reverse hereof), unless otherwise specified on
the face hereof, the related payment of principal, premium, if any, or interest
shall be made on the following day that is a Business Day, and no interest shall
accrue for the period from and after that Interest Payment Date, Maturity Date,
Redemption Date or Optional Repayment Date, as the case may be, to the next
Business Day. In the event the Interest Rate Basis is LIBOR, as indicated above,
if such next Business Day falls in the next calendar month, principal, premium,
if any, or interest will be paid on the preceding day that is a Business Day,
provided that any such Business Day is also a London Banking Day (as defined on
the reverse hereof), with respect to such LIBOR Note. Except as provided above
and in the Indenture referred to on the reverse hereof, interest payments will
be made on the Interest Payment Dates shown above. The "Regular Record Date"
shall be the date whether or not a Business Day 15 calendar days immediately
preceding such Interest Payment Date, unless otherwise specified on the face
hereof.

            The interest so payable, and punctually paid or duly provided for,
on the Interest Payment Dates referred to above, will, as provided in the
Indenture, be paid to the Person in whose name this Note (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest, provided, however, that interest payable on the
Maturity Date, or if applicable, the Redemption Date or Optional Repayment Date,
will be paid to the Person to whom the principal of this Note is payable. Any
such interest which is payable, but is not punctually paid or duly provided for,
on any Interest Payment Date shall forthwith cease to be payable to the Holder
on such Regular Record Date, and may be paid to the Person in whose name this
Note (or one or more Predecessor Securities) is registered at the close of
business on a Special Record Date for the payment of such Defaulted Interest to
be fixed by the Trustee, notice whereof shall be given to the Holder of this
Note not less than ten days prior to such Special Record Date, or may be paid at
any time in any other lawful manner not inconsistent with the requirements of
any securities exchange on which the Notes may be listed and upon such notice as
may be required by such exchange, all as more fully provided in the Indenture.

            Payment of the principal of and interest on this Note shall be made
at the office or agency of the Trustee maintained for that purpose in the
Borough of Manhattan, The City of New York, in such coin or currency of the
United States of America as at the time of payment is legal tender for the
payment of public and private debt; provided, however, that payment of interest
on any Interest Payment Date (other than the Maturity Date or Redemption Date or
Optional Repayment Date, if any) may be made at the option of the Company by
check mailed to the address of the Person entitled thereto as such address shall
appear in the Security Register, or by wire transfer of immediately available
funds, if the registered holder of at least $10,000,000 in principal amount (or
such other principal amount specified on the face hereof) of Notes entitled to
such interest has so requested by a notice in writing delivered to the Trustee
not less than 16 days prior

                                      -5-
<PAGE>

to the Interest Payment Date on which such payment is due, which notice shall
provide appropriate instructions for such transfer.

            The principal hereof and interest due at maturity will be paid upon
maturity in immediately available funds against presentation of this Note at the
office or agency of the Trustee maintained for that purpose in the Borough of
Manhattan, The City of New York.

            REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS NOTE SET
FORTH ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL PURPOSES
HAVE THE SAME EFFECT AS IF SET FORTH ON THE FACE HEREOF.

            This Note shall be governed by and construed in accordance with the
laws of the State of New York.

            This Note is one of the series of Medium-Term Notes, Series B, of
the Company.

            Unless the certificate of authentication hereon has been executed by
JPMorgan Chase Bank, N.A. (formerly, The Chase Manhattan Bank), the Trustee
under the Indenture, or its successor thereunder by the manual signature of one
of its authorized signatories, this Note shall not be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose.

                                      -6-
<PAGE>

            IN WITNESS WHEREOF, the Company has caused this instrument to be
duly executed under its corporate seal.

Dated:

                                       THE BEAR STEARNS COMPANIES INC.

                                       By:
                                          --------------------------------------

ATTEST:

--------------------------
Secretary

[Corporate Seal]

                          CERTIFICATE OF AUTHENTICATION

            This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.

                                       JPMORGAN CHASE BANK, N.A., as Trustee

                                       By:
                                          --------------------------------
                                          Authorized Signature

                                      -7-
<PAGE>

                                [Reverse of Note]

                         THE BEAR STEARNS COMPANIES INC.

                           MEDIUM-TERM NOTE, SERIES B
                                 (FLOATING RATE)

            This Note is one of a duly authorized issue of debentures, notes or
other evidences of indebtedness (hereinafter called the "Securities") of the
Company of the series hereinafter specified, all such Securities issued and to
be issued under the Indenture dated as of May 31, 1991, as amended (herein
called the "Indenture"), between the Company and JPMorgan Chase Bank, N.A.
(formerly, The Chase Manhattan Bank), as Trustee (herein called the "Trustee,"
which term includes any successor trustee under the Indenture), to which
Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights and limitations of rights thereunder of the
Company, the Trustee and the Holders of the Securities, and the terms upon which
the Securities are, and are to be, authenticated and delivered. As provided in
the Indenture, Securities may be issued in one or more series, which different
series may be issued in various aggregate principal amounts, may mature at
different times, may bear interest, if any, at different rates, may be subject
to different redemption provisions, if any, may be subject to different
repayment provisions, if any, may be subject to different sinking, purchase or
analogous funds, if any, may be subject to different covenants and Events of
Default and may otherwise vary as in the Indenture provided or permitted. This
Note is one of a series of the Securities designated as Medium-Term Notes,
Series B (the "Notes"). The Notes of this series may be issued at various times
with different maturity dates, redemption dates and different principal
repayment provisions, may bear interest at different rates and may otherwise
vary, all as provided in the Indenture.

            The interest payable on this Note on each Interest Payment Date will
include accrued interest from and including the Original Issue Date or from and
including the last date in respect of which interest has been paid, as the case
may be, to, but excluding, such Interest Payment Date, except that the interest
payment at the Maturity Date, Redemption Date or Optional Repayment Date will
include interest accrued to but excluding such date. Accrued interest from the
Original Issue Date or from the last date to which interest has been paid is
calculated by multiplying the principal amount hereof by an accrued interest
factor. Such accrued interest factor is computed by adding the interest factors
calculated for each day from the Original Issue Date, or from the last date to
which interest has been paid, to the date for which accrued interest is being
calculated. Unless otherwise specified on the face hereof, the interest factor
(expressed as a decimal calculated to seven decimal places without rounding) for
each such day is computed by dividing the interest rate applicable to such day
by 360, in the case of Commercial Paper Rate Notes, Federal Funds Rate Notes,
LIBOR Notes and Prime Rate Notes, or by the actual number of days in the year,
in the case of Treasury Rate Notes. With respect to CMT Rate Notes, interest is
calculated on the basis of twelve 30-day months and a 360-day year. The interest
rate in effect on each day will be (a) if such day is an Interest Reset Date,
the interest rate with respect to the Interest Determination Date pertaining to
such Interest Reset Date or (b) if such day is not an Interest Reset Date, the
interest rate with respect to the Interest Determination Date pertaining to the
next preceding Interest Reset Date; provided, however, that (i) the interest
rate in effect from the Original Issue Date to the first Interest Reset Date
will be the Initial Interest Rate as specified on the face hereof and (ii) the
interest rate in effect for the ten calendar days immediately prior to

                                      -8-
<PAGE>

maturity will be that in effect on the tenth calendar day preceding maturity.
Notwithstanding the foregoing, if the rate at which interest is payable is
adjusted daily or weekly, such rate of interest shall be adjusted until the
Interest Reset Date immediately preceding the Maturity Date. Notwithstanding the
foregoing, the interest rate hereon shall not be greater than the Maximum
Interest Rate, if any, or less than the Minimum Interest Rate, if any, shown on
the face hereof. All percentages resulting from any calculations will be
rounded, if necessary, to the nearest one hundred-thousandth of a percent, with
five one-millionths of a percent being rounded upwards. In addition, the
interest rate hereon shall in no event be higher than the maximum rate, if any,
permitted by applicable law.

            Commencing with the first Interest Reset Date shown on the face
hereof following the Original Issue Date, and thereafter on each succeeding
Interest Reset Date specified on the face hereof, the rate at which interest on
this Note is payable shall be adjusted daily, weekly, monthly, quarterly,
semiannually or annually as specified on the face hereof under "Interest Reset
Date(s)." Each such adjusted rate shall be applicable on and after the Interest
Reset Date to which it relates to but not including the next succeeding Interest
Reset Date or until the Maturity Date or, if applicable, the Redemption Date or
Optional Repayment Date, as the case may be. Unless otherwise specified on the
face hereof, the Interest Reset Date will be, if this Note resets daily, each
Business Day; if this Note resets weekly, the Wednesday of each week (with the
exception of weekly reset Treasury Rate Notes which will reset the Tuesday of
each week, except as specified below); if this Note resets monthly, the third
Wednesday of each month; if this Note resets quarterly, the third Wednesday of
March, June, September and December; if this Note resets semiannually, the third
Wednesday of the two months specified on the face hereof; and if this Note
resets annually, the third Wednesday of the month specified on the face hereof.
Subject to applicable law and except as specified herein, on each Interest Reset
Date, the rate of interest on this Note shall be the rate determined in
accordance with the provisions applicable below, plus or minus the Spread (as
specified on the face hereof), if any. Unless otherwise specified on the face
hereof, if any Interest Reset Date would otherwise be a day that is not a
Business Day, such Interest Reset Date shall be postponed to the next succeeding
day that is a Business Day, except that in the case of a LIBOR Note, if such
Business Day is in the next succeeding calendar month, such Interest Reset Date
shall be the next preceding Business Day. Unless otherwise specified on the face
hereof, "Business Day" means (i) with respect to any Note, any day that is not a
Saturday or Sunday, and that is neither a legal holiday nor a day on which
banking institutions or trust companies in New York City are authorized or
obligated by law to close, and (ii) with respect to LIBOR Notes only, a London
Banking Day. A "London Banking Day" means any day on which dealings in deposits
in U.S. dollars are transacted in the London interbank market.

            The Interest Determination Date pertaining to an Interest Reset Date
will be, if the Interest Rate Basis is Commercial Paper Rate or Federal Funds
(Effective) Rate, the Business Day next preceding such Interest Reset Date.
Unless otherwise specified on the face hereof, the Interest Determination Date
pertaining to an Interest Reset Date will be, if the Interest Rate Basis is
LIBOR, the second London Banking Day preceding such Interest Reset Date. The
Interest Determination Date pertaining to an Interest Reset Date will be, if the
Interest Rate Basis is Treasury Rate, the day of the week in which such Interest
Reset Date falls on which Treasury bills (as defined below) of the Index
Maturity specified on the face hereof are auctioned. Treasury bills normally are
auctioned on Monday of each week, unless that day is a legal holiday, in which
case the auction is normally held on the following Tuesday, except that such
auction may be held on the preceding Friday. If, as a result of a legal holiday,
an auction is so held on the preceding Friday,

                                      -9-
<PAGE>

such Friday will be the Interest Determination Date pertaining to the Interest
Reset Date occurring in the next succeeding week. Interest payable hereon will
be payable monthly, quarterly, semiannually or annually (the "Interest Payment
Period") as specified on the face hereof. The Interest Determination Date
pertaining to an Interest Reset Date will be, if the Interest Rate Basis is
Prime Rate or Federal Funds (Open) Rate, the same day as such Interest Reset
Date. The Interest Determination Date pertaining to an Interest Reset Date will
be, if the Interest Rate Basis is CMT Rate, the tenth Business Day prior to each
Interest Reset Date. Unless otherwise specified on the face hereof, interest
will be payable, if this Note resets daily, weekly or monthly, on the third
Wednesday of each month or on the third Wednesday of March, June, September and
December, of each year; if this Note resets quarterly, on the third Wednesday of
March, June, September and December, of each year; if this Note resets
semiannually, on the third Wednesday of the two months of each year specified on
the face hereof; and if this Note resets annually, on the third Wednesday of the
month specified on the face hereof (each such date being an "Interest Payment
Date") and in each case, at maturity or, if applicable, upon redemption or
optional repayment.

            Determination of Commercial Paper Rate. If the Interest Rate Basis
specified on the face hereof is "Commercial Paper Rate," the interest rate shall
equal (a) the Money Market Yield (as defined below) on the applicable Interest
Determination Date of the rate for commercial paper having the Index Maturity
specified on the face hereof (i) as published by the Board of Governors of the
Federal Reserve System in "Statistical Release H.15(519), Selected Interest
Rates," or any successor publication ("H.l5(519)"), under the heading
"Commercial Paper--Nonfinancial" or (ii) in the event that such rate is not
published on the Calculation Date (as defined below) pertaining to such Interest
Determination Date, then as published in H.15 Daily Update or any other
recognized electronic source used for displaying that rate under the heading
"Commercial Paper--Nonfinancial" or (b) if neither of such yields is published
by 3:00 P.M., New York City time, on such Calculation Date, the Money Market
Yield of the arithmetic mean of the offered rates as of 11:00 A.M., New York
City time, of three leading dealers of commercial paper in The City of New York
selected by JPMorgan Chase Bank, N.A. (formerly, The Chase Manhattan Bank), as
Calculation Agent (or any successor calculation agent, or any other Calculation
Agent named on the face hereof, the "Calculation Agent"), on that Interest
Determination Date, for commercial paper of the Index Maturity specified on the
face hereof placed for an industrial issuer whose bond rating is "AA," or the
equivalent, from a nationally recognized rating agency, in each of the above
cases, adjusted by the addition or subtraction of the Spread, if any, specified
on the face hereof; provided, however, that if such dealers are not quoting as
mentioned above, the interest rate in effect hereon until the Interest Reset
Date next succeeding the Interest Reset Date to which such Interest
Determination Date relates shall be the rate in effect on the Interest
Determination Date next preceding such Interest Reset Date.

            "Money Market Yield" shall be a yield calculated in accordance with
the following formula:

            Money Market Yield  =     D x 360   x 100
                                   -------------
                                   360 - (D x M)

where "D" refers to the per annum rate for commercial paper quoted on a bank
discount basis and expressed as a decimal; and "M" refers to the actual number
of days in the interest period for which interest is being calculated.

                                      -10-
<PAGE>

            Determination of LIBOR. If the Interest Rate Basis specified on the
face hereof is "LIBOR," the interest rate shall equal, as specified on the face
hereof, either (a) the offered rates for deposits in U.S. dollars having the
Index Maturity specified on the face hereof, commencing (unless otherwise
specified on the face hereof) on the second London Banking Day immediately
following the applicable Interest Determination Date which appears on Telerate
Page 3750 (or such other page as may replace Telerate Page 3750 for the purpose
of displaying London interbank rates of major banks), as of 11:00 A.M., London
time, on such Interest Determination Date adjusted by the addition or
subtraction of the Spread, if any, specified on the face hereof ("LIBOR
Telerate") or (b) the arithmetic mean, as determined by the Calculation Agent,
of the offered rates for deposits in U.S. dollars having the Index Maturity
specified on the face hereof, commencing on the second London Banking Day
immediately following the applicable Interest Determination Date which appears
on the Reuters Screen LIBO Page (or such other page as may replace such Reuters
Screen LIBO Page for the purpose of displaying London interbank rates of major
banks), as of 11:00 A.M., London time, on such Interest Determination Date, if
at least two such offered rates appear on the Reuters Screen LIBO Page (or such
other page as may replace such page) ("LIBOR Reuters"); provided, however, that
if no such rate appears on Telerate Page 3750 (or such other page as may replace
such page) or if fewer than two offered rates appear on the Reuters Screen LIBO
Page (or such other page as may replace such page), the Calculation Agent shall
request the principal London office of each of four major banks in the London
interbank market selected by the Calculation Agent to provide a quotation of the
rate at which such bank offered to prime banks in the London interbank market at
approximately 11:00 A.M., London time, on such Interest Determination Date,
deposits in U.S. dollars having the Index Maturity specified on the face hereof
commencing (unless otherwise specified on the face hereof) on the second London
Banking Day immediately following such Interest Determination Date and in a
principal amount equal to an amount not less than U.S. $1,000,000 that is
representative of a single transaction in such market at such time, and such
rate of interest hereon shall equal the arithmetic mean of (a) such quotations,
if at least two quotations are provided, or (b) if less than two quotations are
provided, the rates quoted at approximately 11:00 A.M., New York City time, on
such Interest Determination Date by three major banks in The City of New York,
selected by the Calculation Agent for loans in U.S. dollars to leading European
banks, having the Index Maturity specified on the face hereof commencing (unless
otherwise specified on the face hereof) on the second London Banking Day
immediately following such Interest Determination Date and in a principal amount
as aforesaid, in either case, adjusted by the addition or subtraction of the
Spread, if any, specified on the face hereof; provided, however, that if the
three banks selected as aforesaid by the Calculation Agent are not quoting as
mentioned above, the interest rate in effect hereon until the Interest Reset
Date next succeeding the Interest Reset Date to which such Interest
Determination Date relates shall be the rate in effect on the Interest
Determination Date next preceding such Interest Reset Date.

            Determination of Federal Funds Rate. If the Interest Rate Basis
specified on the face hereof is "Federal Funds Rate," the interest rate shall
equal either the Federal Funds (Effective) Rate or the Federal Funds (Open)
Rate.

            Unless otherwise specified on the face hereof, the Federal Funds
(Effective) Rate shall equal (a) the rate on the applicable Interest
Determination Date specified on the face hereof for Federal Funds as published
in H.15(519) under the heading "Federal funds (effective)" on Telerate page 120
or any successor service or page, or (b) if such rate is not so published on the
Calculation Date pertaining to such Interest Determination Date, then the rate
on the applicable

                                      -11-
<PAGE>

Interest Determination Date as published in H.15 Daily Update or any other
recognized electronic source used for displaying that rate under the heading
"Federal Funds/Effective Rate."

            Unless otherwise specified on the face hereof, the Federal Funds
(Open) Rate shall equal the rate on the applicable Interest Determination Date
specified on the face hereof for Federal Funds as reported on Telerate Page 5
under the heading "Federal Funds/Open."

            If (a) the applicable Federal Funds (Effective) Rate described above
or (b) the Federal Funds (Open) Rate described above is not published by 3:00
P.M., New York City time, on the relevant Calculation Date, then the Federal
Funds (Effective) Rate and the Federal Funds (Open) Rate, as applicable, will be
calculated by the Calculation Agent as the arithmetic mean of the rates for the
last transaction in overnight Federal Funds arranged by three leading brokers of
Federal Funds transactions in The City of New York selected by the Calculation
Agent as of 11:00 A.M., New York City time, on such Interest Determination Date,
in each of the above cases, adjusted by the addition or subtraction of the
Spread, if any, specified on the face hereof; provided, however, that if such
brokers are not quoting as mentioned above, the interest rate in effect hereon
until the Interest Reset Date next succeeding the Interest Reset Date to which
such Interest Determination Date relates shall be the rate in effect on the
Interest Determination Date next preceding such Interest Reset Date.

            Determination of Treasury Rate. If the Interest Rate Basis specified
on the face hereof is "Treasury Rate," the interest rate shall equal the rate
for the auction held on the applicable Interest Determination Date of direct
obligations of the United States ("Treasury bills") having the Index Maturity
specified on the face hereof as published under the column designated "Invest
Rate" on Telerate page 56 under the heading "US Treasury 3 MO T-Bill Auction
Results" or Telerate page 57 under the heading "US Treasury 6 MO T-Bill Auction
Results," as applicable, or any successor publication, or, if not so published
on the Calculation Date pertaining to such Interest Determination Date, the
auction average rate (expressed as a bond equivalent on the basis of a year of
365 or 366 days, as applicable, and applied on a daily basis) as otherwise
announced by the United States Department of the Treasury, in either case,
adjusted by the addition or subtraction of the Spread, if any, specified on the
face hereof. In the event that the results are not published or reported as
provided above by 3:00 P.M., New York City time, on such Calculation Date, or if
no such auction is held in a particular week, then the rate of interest herein
shall be calculated by the Calculation Agent and shall be a yield to maturity
(expressed as a bond equivalent on the basis of a year of 365 or 366 days, as
applicable, and applied on a daily basis) of the arithmetic mean of the
secondary market bid rates as of approximately 3:30 P.M., New York City time, on
such Interest Determination Date, of three leading primary United States
government securities dealers selected by the Calculation Agent for the issue of
Treasury bills with a remaining maturity closest to the Index Maturity specified
on the face hereof, adjusted by the addition or subtraction of the Spread, if
any, specified on the face hereof; provided, however, that if the dealers
selected as aforesaid by the Calculation Agent are not quoting as mentioned
above, the interest rate in effect hereon until the Interest Reset Date next
succeeding the Interest Reset Date to which such Interest Determination Date
relates shall be the rate in effect on the Interest Determination Date next
preceding such Interest Reset Date.

            Determination of Prime Rate. If the Interest Rate Basis specified on
the face hereof is "Prime Rate," the interest rate shall equal (a) the rate on
the applicable Interest Determination Date (i) as reported on Telerate Page 5
under the heading "Bank Rates/Prime" or (ii) as published

                                      -12-
<PAGE>

in H.15(519), under the caption "Bank Prime Loan", (b) if the rates referred to
under (a)(i) and (a)(ii) are not published by 9:00 A.M., New York City time, on
the Calculation Date pertaining to such Interest Determination Date, then the
arithmetic mean (as calculated by the Calculation Agent) of the rates of
interest publicly announced by each bank named on the Reuters Screen NYMF Page
(as defined below) as such bank's prime rate or base lending rate as in effect
for such Interest Determination Date as quoted on the Reuters Screen NYMF Page
for such Interest Determination Date, or, if fewer than four such rates appear
on the Reuters Screen NYMF Page for such Interest Determination Date, the rate
shall be the arithmetic mean (as calculated by the Calculation Agent) of the
prime rates quoted on the basis of the actual number of days in the year divided
by 360 as of the close of business on such Interest Determination Date by at
least two of the three major money center banks in The City of New York selected
by the Calculation Agent (after consultation with the Company) from which
quotations are requested, or (c) if fewer than two quotations are provided under
(b) above, the Prime Rate shall be calculated by the Calculation Agent and shall
be determined as the arithmetic mean on the basis of the prime rates in The City
of New York by the appropriate number of substitute banks or trust companies
organized and doing business under the laws of the United States, or any State
thereof, in each case having total equity capital of at least U.S. $500 million
and being subject to supervision or examination by Federal or State authority,
selected by the Calculation Agent (after consultation with the Company) to quote
such rate or rates, in each case adjusted by the addition or subtraction of the
Spread, if any, specified on the face hereof; provided, however, that if in any
month or two consecutive months, the Prime Rate is not reported or published as
provided above, and if such quotations are not available, the interest rate in
effect hereon until the Interest Reset Date next succeeding the Interest Reset
Date to which such Interest Determination Date relates shall be the rate in
effect on the Interest Determination Date next preceding such Interest Reset
Date in each case.

            If this failure continues over three or more consecutive months, the
Prime Rate for each succeeding Interest Determination Date until the maturity or
redemption of this Note or, if earlier, until this failure ceases, shall be
LIBOR determined as if this Note were a LIBOR Note, and the Spread, if any, will
be the number of basis points specified on the face hereof as the "Alternate
Rate Event Spread."

            "Reuters Screen NYMF Page" means the display designated as Page
"NYMF" on the Reuters Monitor Money Rates Service (or such other page as may
replace the NYMF Page on that service for the purpose of displaying prime rates
or base lending rates of major United States banks).

            Determination of CMT Rate. If the Interest Rate Basis specified on
the face hereof is "CMT Rate," the interest rate will be determined by the
Calculation Agent on each Interest Determination Date in accordance with the
following provisions, in each case, adjusted by the addition or subtraction of
the Spread, if any, specified on the face hereof.

            Unless otherwise specified on the face hereof, the CMT Rate will be:

            (a) the rate displayed on the designated CMT Telerate Page, under
the caption for "... Treasury Constant Maturities... Federal Reserve Board
Release H.15... Mondays Approximately 3:45 p.m.," under the column for the
designated CMT Index Maturity, for: (i) the latest rate displayed at the close
of business on such Interest Determination Date if the designated CMT Telerate
Page is 7051; or (ii) the average for the week, or the month, as specified on
the face

                                      -13-
<PAGE>

hereof, ended immediately before the week in which the related Interest
Determination Date occurs if the designated CMT Telerate Page is 7052.

            (b) If the applicable rate specified in (a) above is not displayed
on the relevant page by 3:00 p.m., New York City time on that Calculation Date,
unless the calculation is made earlier and the rate is available from that
source at that time on the Calculation Date, then the CMT Rate will be the
Treasury constant maturity rate having the designated Index Maturity, as
published in H.15(519) or another recognized electronic source for displaying
the rate.

            (c) If the applicable rate specified in (b) above is not published
in H.15(519) or another recognized electronic source for displaying such rate by
3:00 p.m., New York City time on that Calculation Date, unless the calculation
is made earlier and the rate is available from one of those sources at that
time, then the CMT Rate will be the Treasury constant maturity rate, or other
United States Treasury rate, for the Index Maturity and with reference to the
relevant Interest Determination Date, that is published by either the Board of
Governors of the Federal Reserve System or the United States Department of the
Treasury and that the Calculation Agent determines to be comparable to the rate
formerly displayed on the designated CMT Telerate Page and published in
H.15(519).

            (d) If the applicable rate specified in (c) above cannot be
determined, then the Calculation Agent will determine the CMT Rate to be a yield
to maturity based on the average of the secondary market offered rates as of
approximately 3:30 p.m., New York City time, on the relevant Interest
Determination Date reported, according to their written records, by three
leading primary United States government securities dealers in New York City.
The Calculation Agent will select five such securities dealers after consulting
with the Company, and will eliminate the highest quotation (or, in the event of
equality, one of the highest) and the lowest quotation (or, in the event of
equality, one of the lowest), for the most recently issued direct noncallable
fixed rate obligations of the United States Treasury ("Treasury Notes") with an
original maturity of approximately the designated Index Maturity and a remaining
term to maturity of not less than the designated Index Maturity minus one year
in a representative amount. If two Treasury Notes with an original maturity as
described above have remaining terms to maturity equally close to the designated
Index Maturity, the quotes for the Treasury Note with the shorter remaining term
to maturity will be used.

            (e) If the Calculation Agent cannot obtain three Treasury Note
quotations of the kind described in the prior paragraph, the Calculation Agent
will determine the CMT Rate to be the yield to maturity based on the average of
the secondary market offered rates for Treasury Notes with an original maturity
longer than the designated CMT Index Maturity which have a remaining term to
maturity closest to the designated CMT Index Maturity and in a representative
amount, as of approximately 3:30 p.m., New York City time, on the relevant
Interest Determination Date of leading primary United States government
securities dealers in New York City. In selecting these offered rates, the
Calculation Agent will request quotations from at least five such securities
dealers and will disregard the highest quotation (or if there is equality, one
of the highest) and the lowest quotation (or if there is equality, one of the
lowest). If two Treasury Notes with an original maturity longer than the
designated CMT Index Maturity have remaining terms to maturity that are equally
close to the designated CMT Index Maturity, the Calculation Agent will obtain
quotations for the Treasury Note with the shorter remaining term to maturity.

            (f) If fewer than five but more than two if the leading primary
United States

                                      -14-
<PAGE>

government securities dealers are quoting as described in the prior paragraph,
then the CMT Rate for the relevant Interest Determination Date will be based on
the average of the offered rates obtained, and neither the highest nor the
lowest of those quotations will be eliminated.

            (g) If two or fewer leading primary United States government
securities dealers selected by the Calculation Agent are quoting as described
above, the CMT Rate will remain the CMT Rate then in effect on that Interest
Determination Date.

            The Calculation Date pertaining to an Interest Determination Date
shall be the earlier of (a) the tenth calendar day after such Interest
Determination Date or if any such day is not a Business Day, the next succeeding
Business Day, or (b) the Business Day prior to the applicable Interest Payment
Date, Maturity Date, Redemption Date or Optional Repayment Date. The Calculation
Agent shall calculate the interest rate hereon in accordance with the foregoing
and will confirm in writing such calculation to the Trustee and any Paying Agent
immediately after each determination. Neither the Trustee nor any Paying Agent
shall be responsible for any such calculation. All determinations made by the
Calculation Agent shall be, in the absence of manifest error, conclusive for all
purposes and binding on the Company and holders of the Note. At the request of
the Holder hereof, the Calculation Agent will provide to the Holder hereof the
interest rate hereon then in effect and, if different, the interest rate that
will become effective as a result of a determination made on the most recent
Interest Reset Date with respect to the Note.

            If so specified on the face of this Note, this Note may be redeemed
by the Company on and after the date so indicated on the face hereof. If no such
date is set forth on the face hereof, this Note may not be redeemed prior to
maturity. On and after such date, if any, from which this Note may be redeemed,
unless otherwise specified on the face hereof, this Note may be redeemed in
whole or in part in increments of $1,000 (provided, unless a different minimum
denomination is set forth on the face hereof, that any remaining principal
amount of this Note shall be at least $25,000) at the option of the Company, at
a redemption price equal to 100% of the principal amount to be redeemed,
together with interest thereon payable to the Redemption Date, on notice given,
unless otherwise specified on the face hereof, not more than 60 nor less than 30
days prior to the Redemption Date. If less than all the Outstanding Notes having
such terms as specified by the Company are to be redeemed, the particular Notes
to be redeemed shall be selected by the Trustee not more than 60 days prior to
the Redemption Date from the Outstanding Notes having such terms as specified by
the Company not previously called for redemption, by such method as the Trustee
shall deem fair and appropriate. The notice of such redemption shall specify
which Notes are to be redeemed. In the event of redemption of this Note, in part
only, a new Note or Notes in authorized denominations for the unredeemed portion
hereof shall be issued in the name of the Holder hereof upon the surrender
hereof.

            If so specified on the face of this Note, this Note will be subject
to repayment at the option of the Holder hereof on the Optional Repayment
Date(s). Except as set forth in the next paragraph, if no Optional Repayment
Date is set forth on the face hereof, this Note may not be repaid at the option
of the Holder prior to maturity. Unless otherwise specified on the face hereof,
on and after the Optional Repayment Date, if any, from which this Note may be
repaid at the option of the Holder, this Note shall be repayable in whole or in
part in increments of $1,000 (provided, unless a different minimum denomination
is set forth on the face hereof, that any remaining principal amount of this
Note shall be at least $25,000) at a repayment price equal to 100% of the
principal amount to be repaid, together with interest thereon payable to the
Optional Repayment

                                      -15-
<PAGE>

Date. For this Note to be repaid in whole or in part at the option of the Holder
hereof, the Trustee must receive not less than 30 nor more than 60 days prior to
the Optional Repayment Date (i) this Note with the form entitled "Option to
Elect Repayment," which appears below, duly completed or (ii) a telegram, telex,
facsimile transmission or a letter from a member of a national securities
exchange or the National Association of Securities Dealers, Inc. or a commercial
bank or trust company in the United States of America setting forth the name of
the Holder of this Note, the principal amount of this Note, the certificate
number of this Note or a description of this Note's tenor or terms, the
principal amount of this Note to be repaid, a statement that the option to elect
repayment is being exercised thereby and a guarantee that this Note with the
form entitled "Option to Elect Repayment," which appears below, duly completed,
will be received by the Trustee no later than five Business Days after the date
of such telegram, telex, facsimile transmission or letter and this Note and such
form duly completed are received by the Trustee by such fifth Business Day.
Exercise of the repayment option shall be irrevocable.

            If an Event of Default with respect to the Notes shall occur and be
continuing, the Trustee or the Holders of not less than 25% in principal amount
of the Outstanding Notes may declare the principal of all the Notes due and
payable in the manner and with the effect provided in the Indenture.

            The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with the
consent of the Holders of 66-2/3% in aggregate principal amount of the
Securities at the time Outstanding of each series affected thereby. The
Indenture also contains provisions permitting the Holders of specified
percentages in aggregate principal amount of the Securities of each series at
the time Outstanding, on behalf of the Holders of all Securities of each series,
to waive compliance by the Company with certain provisions of the Indenture and
certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the Holder of this Note shall be conclusive and binding
upon such Holder and upon future Holders of this Note and of any Note issued
upon the registration of transfer hereof or in exchange hereof or in lieu hereof
whether or not notation of such consent or waiver is made upon this Note.

            Holders of Securities may not enforce their rights pursuant to the
Indenture or the Securities except as provided in the Indenture. No reference
herein to the Indenture and no provision of this Note or the Indenture shall
alter or impair the obligation of the Company, which is absolute and
unconditional, to pay the principal of and interest on this Note at the time,
place, and rate, and in the coin or currency, herein prescribed.

            As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Note may be registered on the Security
Register of the Company, upon surrender of this Note for registration of
transfer at the office or agency of the Company in the Borough of Manhattan, The
City of New York, duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Company, and this Note duly executed by,
the Holder hereof or by his attorney duly authorized in writing and thereupon
one or more new Notes, of authorized denominations and for the same aggregate
principal amount, will be issued to the designated transferee or transferees.

                                      -16-
<PAGE>

            Unless otherwise specified on the face hereof, the Notes are
issuable only in registered form without coupons in denominations of $25,000 or
any amount in excess thereof which is an integral multiple of $1,000. As
provided in the Indenture and subject to certain limitations therein set forth,
this Note is exchangeable for a like aggregate principal amount of Notes of
different authorized denomination as requested by the Holder surrendering the
same.

            No service charge will be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.

            Prior to the due presentment of this Note for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Note is registered as the owner hereof
for all purposes, whether or not this Note be overdue, and neither the Company,
the Trustee nor any such agent shall be affected by notice to the contrary.

            The interest rate payable with respect to this Note shall in no
event be higher than the maximum rate, if any, permitted by applicable law.

            All capitalized terms used in this Note and not otherwise defined
herein shall have the meanings assigned to them in the Indenture.

                                      -17-
<PAGE>

                                  ABBREVIATIONS

The following abbreviations, when used in the inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:

TEN COM     -     as tenants in common

TEN ENT     -     as tenants by the entireties

JT TEN      -     as joint tenants with right of survivorship and not as tenants
                  in common

UNIF GIFT MIN ACT - ________________________ Custodian ________________________
                              (Cust)                           (Minor)

                                 Under Uniform Gifts to Minors Act

                              _________________________________________
                                              (State)

Additional abbreviations may also be used though not in the above list.

                              ____________________

                            OPTION TO ELECT REPAYMENT

            The undersigned hereby irrevocably request(s) and instruct(s) the
Company to repay this Note (or portion thereof specified below) pursuant to its
terms on _____________, 20__ (the "Optional Repayment Date") at a price equal to
the principal amount thereof, together with interest to the Optional Repayment
Date, to the undersigned at

________________________________________________________________________________

________________________________________________________________________________
        (Please print or typewrite name and address of the undersigned.)

            For this Note to be repaid the Trustee must receive at 4 New York
Plaza, New York, New York 10004, Attention: Debt Operations -- 13th Floor, or at
such other place or places of which the Company shall from time to time notify
the Holder of this Note, not more than 60 days nor less than 30 days prior to
the Optional Repayment Date, this Note with this "Option to Elect Repayment"
form duly completed.

                                      -18-
<PAGE>

            If less than the entire principal amount of this Note is to be
repaid, specify the portion thereof (which shall be increments of $1,000) which
the Holder elects to have repaid: $______________; and specify the denomination
or denominations (which, unless a different minimum denomination is set forth on
the face hereof, shall be $25,000 or an integral multiple of $1,000 in excess of
$25,000) of the Notes to be issued to the Holder for the portion of this Note
not being repaid (in the absence of any such specification, one such Note will
be issued for the portion not being repaid):
$________________.

Date:____________________     ________________________________________________
                              Note: The signature to this Option to Elect
                              Repayment must correspond with the same as written
                              upon the face of this Note in every particular
                              without alteration or enlargement.

                       _________________________________

                                   ASSIGNMENT
                                   ----------

                       FOR VALUE RECEIVED, the undersigned
                 hereby sell(s), assign(s) and transfer(s) unto

________________________________________________________________________________
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE

________________________________________________________________________________

________________________________________________________________________________
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE

________________________________________________________________________________
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing

______________________________________________________________________ Attorney
to transfer said Note on the books of the Company, with full power of
substitution in the premises.

Dated:  __________________________

                                                ________________________________

_______________________________________
         (Signature Guarantee)

                                      -19-Purchase and Sale Agreement

PURCHASE AND SALE AGREEMENT

BETWEEN

PKLB LIMITED PARTNERSHIP, a Maryland partnership having

BASi MARYLAND, INC., a Maryland corporation as its general partner

AS SELLER

AND

THE KEVIN F. DONOHOE COMPANY, INC.

a Pennsylvania corporation

AS PURCHASER

As of November 11, 2004

PURCHASE AND SALE AGREEMENT

        THIS PURCHASE AND SALE AGREEMENT
(this “Agreement”) is made as of the 11th day of November, 2004 (the
“Effective Date”), by and between PKLB LIMITED PARTNERSHIP, a Maryland
partnership having BASi MARYLAND, INC., a Maryland corporation as its general
partner, having an address at 300 W. Fayette Street, Baltimore, Maryland 21201,
and The Kevin F. Donohoe Company, Inc., a Pennsylvania corporation, its
successors and assigns (“Purchaser”), having an address at The Curtis
Center, Suite 700, Independence Square West, Philadelphia, Pennsylvania 19106.

W I T N E S S E T H:

ARTICLE 1.

PURCHASE AND SALE

        1.        
Agreement of Purchase and Sale.    Purchaser and
Seller entered into a Purchase and Sale Agreement dated July 26, 2004 (the
“Initial Agreement”), a’ copy of which is attached hereto as
Exhibit A. The Initial Agreement was terminated by the Purchaser pursuant to
Section 3.2 thereof by a letter from Purchaser to Seller dated September
17, 2004. Notwithstanding such termination, the parties hereto wish to proceed
with the sale and purchase of the Property in accordance with the terms and
conditions of the Initial Agreement, which terms and conditions are hereby
incorporated by reference herein, and are modified as set forth
below.

ARTICLE 2.

MODIFICATIONS TO INITIAL AGREEMENT

     
                  1.        
          The Purchase Price is Six Million Five Hundred Thousand Dollars ($6,500,000).

     
                  2.        
          Paragraph 1.5 shall read as follows:

        “Within
ten (10) business days after the Effective Date, Purchaser shall deposit with First
American Title Insurance Company (the “Escrow Agent”), having its office at 410
E. Pratt Street, Suite 323, Baltimore, Maryland 21202, Attention: Joseph Reineberg, the
sum of One Million Dollars ($1,000,000) (the “Earnest Money”) in good funds,
either by certified bank or cashier’s check or by federal wire transfer. The parties
agree to use commercially reasonable efforts to reach agreement with respect to all title
matters and the final form of the Seller Lease within the ten (10) day period following
the Effective Date. The Earnest Money shall be non-refundable except in the case of (i) a
default by Seller under Section 6.2, or (ii) any other provision of this Agreement
pursuant to which Purchaser shall be entitled to a return of the Earnest Money following a
termination hereof. The Escrow Agent shall hold the Earnest Money in an interest-bearing
account in accordance with the terms and conditions of an escrow agreement in a form
reasonably acceptable to Seller, Purchaser and Escrow Agent entered into among Seller,
Purchaser and Escrow Agent simultaneously with the execution of this Agreement. All
interest accruing on such sum shall become a part of the Earnest Money and shall be
distributed as Earnest Money in accordance with the terms of this Agreement.

        3.        
Paragraph 2.1, 2.2, 2.3 (including subparagraphs 2.3.2, 2.3.3 and 2.3.4) and 2.5
are deleted.

        4.        
Article 3 shall read as follows:

        3.1        
Right of Inspection.    During the period beginning upon the Effective Date until Closing,
Purchaser shall have the right to make a physical inspection of the Property and to
examine during Seller’s normal business hours, at such place or places at the
Property, in the offices of the property manager or elsewhere as the same may be located,
any operating files maintained by Seller or its property manager in connection with the
redevelopment, leasing, maintenance and/or management of the Property, including, without
limitation, the Leases, lease files, Operating Agreements, insurance policies, bills,
invoices, receipts and other general records relating to the income and expenses of the
Property, correspondence, surveys, engineering reports, plans and specifications,
warranties for services and materials provided to the Property, and environmental audits
and similar materials. Any inspections by Purchaser shall be conducted only during
Seller’s normal business hours and upon at least 24 hours prior notice to Seller.
Purchaser will use commercially reasonable efforts to perform its inspections in a manner
that does not materially interfere with Seller’s business operations being conducted
upon the Property. Purchaser shall be entitled to conduct invasive testing on the Property
with Seller’s prior written consent, which consent shall not be unreasonably
withheld, conditioned or delayed. Purchaser agrees to repair any damage to the Property
caused by Purchaser and to indemnify against and bold Seller harmless from any claim for
liabilities, costs, expenses (including reasonable attorneys’ fees actually incurred)
damages or injuries arising out of or resulting from the inspection or testing of the
Property by Purchaser or its agents, and notwithstanding anything to the contrary in this
Agreement, such obligation to indemnify and hold harmless Seller shall survive Closing or
any termination of this Agreement. Purchaser shall maintain public liability and property
damage insurance in the amount of $1,000,000, and automobile liability insurance in an
amount not less than $1,000,000 which insurance coverage shall name Seller as an
additional insured and which insurance coverage shall otherwise be in form and substance
satisfactory to Seller and adequate to insure against all liability of Purchaser and its
consultants, respectively, and each of its agents, employees or contractors, arising out
of the inspections or testing. All inspections and testing shall occur at reasonable times
agreed upon by Seller and Purchaser and shall be conducted so as not to interfere
unreasonably with use of the Property by Seller or its tenants. 

        3.2        
Seller Lease.    Seller and Purchaser agree to act in good faith to agree upon the terms and
conditions of a triple net lease between Seller, as tenant, and Purchaser, as landlord,
for approximately 101,000 square feet of space on the Property (the “Seller
Lease”), which terms and conditions will include, but shall not be limited to (i) a
lease term of three (3) years beginning with the date of Closing, (ii) base rent equal to
$8.00 per leasable square foot of space on a triple net basis, with Seller being
responsible for all its proportionate share of operating costs, including, without
limitation, utilities, real estate taxes and insurance and all maintenance and repair
costs (including elevators) except that Purchaser shall be responsible for roof repair and
maintenance and all other capital repairs or replacements (including floors, slabs,
foundations and structural elements of the Property), and (iii) an agreement by Purchaser
that it will not intentionally take any action that would materially adversely impact
Seller’s business during the lease term (with the understanding that Seller, as
tenant, is solely responsible for compliance with all laws, rules and regulations
applicable to its business). In order to secure Seller’s obligations under the Lease,
Seller shall deliver to Purchaser at Closing an irrevocable letter of credit in the face
amount of Two Million Eight Hundred Thousand Dollars ($2,800,000) issued by a financial
institution and in form and substance acceptable to Purchaser (the “Letter of
Credit”). The Letter of Credit shall remain in place for the term of the Seller Lease
and may be drawn by Purchaser in the event of Seller’s failure to comply with its
obligations under the Seller Lease or in the event that the Letter of Credit is not
renewed within thirty (30) days of any expiration thereof. Provided no default has
occurred under the Seller Lease, the face amount of the Letter of Credit may be reduced to
Two Million Dollars ($2,000.000) on the first anniversary of the date of the Seller Lease
and to One Million Dollars ($1,000,000) on the second anniversary of the date of the
Seller Lease. 

2

        5.        
Paragraph 4.1. shall read as follows:

        “The
Closing shall be held at the offices of Gallagher Evelius & Jones LLP, 216 N.
Charles Street, Suite 400, Baltimore, Maryland 21201, on the date selected by the
Purchaser with at least five (5) days prior notice to the Seller not later than the
thirtieth (30th) day following the Effective Date (the “Outside Date”). Buyer
shall have the right to extend the Outside Date by up to ten (10) days by notifying the
Seller on or before the thirtieth (30th) day following the Effective Date of its desire to
so extend the Outside Date.”

        6.        
          Paragraph 4.6 is amended by adding the following paragraph;

        “4.6.5    
Seller has complied with all of the Schedule B-Section 1 requirements applicable
to the Seller as required by the title company in the Title Commitment issued by First
American Title Insurance Company, Commitment No. NOS-106989-PHIL, effective April 24,
2004. Notwithstanding the foregoing, nothing shall relieve the Purchaser of any of the
obligations Purchaser has assumed under the other terms of the Agreement in order to
comply with its Schedule B-1 requirements.”

        All
references in the Initial Agreement to the “Effective Date” shall be deemed to
mean the Effective Date of this Agreement. 

[Signatures follow on next page]

3

        IN WITNESS WHEREOF, and
intending to be legally bound, the undersigned have duly executed this
Agreement. 

	
 	
SELLER:

PKLB LIMITED PARTNERSHIP

By:  BASi MARYLAND, INC., General Partner

By:  /s/  Michael P. Silvon, Ph.D.

Name:  Michael P. Silvon, Ph.D.

Title:  Secretary

PURCHASER:

THE KEVIN F. DONOHOE COMPANY, INC.

By:  /s/  Henry B. Glover, Jr.

Name:  Henry B. Glover, Jr.

Title:  Vice President

4

EXHIBIT A

AGREEMENT OF PURCHASE AND SALE

BETWEEN PKLB LIMITED PARTNERSHIP

“SELLER”

AND

THE KEVIN F. DONOHOE COMPANY, INC.

“BUYER”

DATED JULY 26, 2004

5

PURCHASE AND SALE AGREEMENT

BETWEEN

PKLB LIMITED PARTNERSHIP, a Maryland partnership having

BASi MARYLAND, INC., a Maryland corporation as its general partner

AS SELLER

AND

THE KEVIN F. DONOHOE COMPANY, INC.

a Pennsylvania corporation

AS PURCHASER

As of July 26, 2004

TABLE OF CONTENTS

	ARTICLE 1   PURCHASE AND SALE	1 
	   1.1   Agreement of Purchase and Sale	1 
	   1.2   Property Defined	2 
	   1.3    Permitted Exceptions	2 
	   1.4    Purchase Price	2 
	   1.5    Earnest Money	2 
	   1.6    Independent Contract Consideration	3 
	ARTICLE 2   TITLE, SURVEY AND ENVIRONMENTAL	3 
	   2.1    Title Examination; Commitment for Title Insurance	3 
	   2.2    Survey	3 
	   2.3    Title/Survey Objections: Cure of Title/Survey Objections	3 
	   2.4    Conveyance of Title	4 
	   2.5    Environmental Assessment	4 
	   2.6    No Change in Status	5 
	ARTICLE 3   INSPECTION PERIOD	5 
	   3.1    Right of Inspection	5 
	   3.2    Right of Termination	5 
	   3.3    Seller Lease	6 
	ARTICLE 4   CLOSING	6 
	   4.1    Time and Place	6 
	   4.2    Seller's Obligations at Closing	6 
	   4.3    Purchaser's Obligations at Closing	8 
	   4.4    Credits and Prorations	8 
	   4.5    Closing Costs	10 

i

	   4.6    Conditions Precedent to Obligation of Purchaser	10 
	   4.7    Conditions Precedent to Obligation of Seller	11 
	ARTICLE 5   REPRESENTATIONS, WARRANTIES AND COVENANTS	11 
	   5.1    Representations and Warranties of Seller	11 
	   5.2    Survival of Seller's Representations and Warranties	13 
	   5.3    Operating Covenant of Seller	13 
	   5.4    Representations and Warranties of Purchaser	13 
	   5.5    Survival of Purchaser's Representations and Warranties	14 
	ARTICLE 6   DEFAULT	14 
	   6.1    Default by Purchaser	14 
	   6.2    Default by Seller	14 
	ARTICLE 7   RISK OF LOSS	15 
	   7.1    Minor Damage	15 
	   7.2    Major Damage	15 
	   7.3    Definition of "Major Loss"	15 
	ARTICLE 8   COMMISSIONS	16 
	   8.1    Brokerage Commissions	16 
	ARTICLE 9   MISCELLANEOUS	16 
	   9.1    Indemnification	16 
	   9.2    Public Disclosure	16 
	   9.3    Assignment	16 
	   9.4    Notices	17 
	   9.5    Modifications	18 
	   9.6    Calculation of Time Periods	18 
	   9.7    Successors and Assigns	18 

ii

	   9.8    Entire Agreement	18 
	   9.9    Further Assurances	18 
	   9.10  Counterparts	18 
	   9.11  Severability	19 
	   9.12  Applicable Law	19 
	   9.13  No Third Party Beneficiary	19 
	   9.14  Exhibits and Schedules	19 
	   9.15  Captions	19 
	   9.16  Construction	19 
	   9.17 Termination of Agreement	19 
	   9.18  Survival	20 
	   9.19  No Recordation	20 
	   9.20  Confidentiality	20 
	EXHIBIT A   LEGAL DESCRIPTION OF THE LAND	22 
	EXHIBIT B   RENT ROLL	23 
	EXHIBIT C   OPERATING AGREEMENTS SCHEDULE	24 

iii

PURCHASE AND SALE AGREEMENT

        THIS PURCHASE AND SALE AGREEMENT
(this “Agreement”) is made as of the 26th day of July, 2004 (the
“Effective Date”) by and between PKLB LIMITED PARTNERSHIP, a Maryland
partnership having BASi MARYLAND, INC., a Maryland corporation as its general
partner, having an address at 300 W. Fayette Street, Baltimore, Maryland 21201,
and The Kevin F. Donohoe Company, Inc., a Pennsylvania corporation, its
successors and assigns (“Purchaser”), having an address at The Curtis
Center, Suite 700, Independence Square West, Philadelphia, Pennsylvania 19106.

W I T N E S S E T H:

ARTICLE 1

PURCHASE AND SALE

        1.1         Agreement
of Purchase and Sale. Subject to the terms and conditions hereinafter set forth, Seller
agrees to sell and convey and Purchaser agrees to purchase the following: 

                        1.1.1    
    that certain tract or parcel of land situated at 300-306
W. Fayette Street, Baltimore City, Maryland more particularly described on
Exhibit A attached hereto and made a part hereof, together with all and singular
the rights and appurtenances pertaining to such property, including any right,
title and interest of Seller in and to adjacent streets, alleys or rights-of-way
(the property described in this Subsection 1.1.1 being herein referred to
collectively as the “Land”); 

                        1.1.2
        all buildings, structures, fixtures and other improvements on the Land (the property
described in this Subsection 1.1.2 being herein referred to collectively as the “Improvements”); 

                        1.1.3         all
of Seller’s right, title and interest in and to all tangible personal property upon
the Land or within the Improvements, including, without limitation, appliances,
furniture, carpeting, draperies and curtains, tools and supplies, and other items of
personal property (excluding cash) used exclusively in connection with the operation of
the Land and the Improvements (the property described in this Subsection 1.1.3 being
herein referred to collectively as the “Personal Property”); Personal Property
does not include furniture, appliances, tools and supplies used in the normal course of
Seller’s business. 

                        1.1.4         all
of Seller’s right, title and interest in and to all agreements listed and described
on Exhibit B (the “Rent Roll”) attached hereto and made a part hereof, pursuant
to which any portion of the Land or Improvements is used or occupied by anyone other than
Seller (the property described in this Subsection 1.1.4 being herein referred to
collectively as the “Leases”) which leases shall include the Seller Lease (as
hereinafter defined); and 

               
         1.1.5         all
of Seller’s right, title and interest in and to (i) all contracts and agreements
(collectively, the “Operating Agreements”) listed and described on Exhibit C
(the “Operating Agreements Schedule”) attached hereto and made a part hereof,
relating to the upkeep, repair, maintenance or operation of the Land, Improvements or
Personal Property which will extend beyond the date of Closing (as such term is defined
in Section 4.1 hereof), including specifically, without limitation, all assignable
equipment leases, and (ii) all assignable existing warranties and guaranties (expressed
or implied) issued to Seller in connection with the Improvements or the Personal Property
(the property described in this Subsection 1.1.5 being sometimes herein referred to
collectively as the “Intangibles”). 

        1.2        Property
 Defined.    The Land,  the  Improvements,  the  Personal  Property,  the Leases and the
 Intangibles  are  hereinafter sometimes referred to collectively as the "Property."

        1.3        Permitted
Exceptions.    The Property shall be conveyed subject to the matters which are, or are
deemed to be, Permitted Exceptions pursuant to Article 2 hereof. For purposes hereof,
“Permitted Exceptions” are those matters affecting title to the Property which
Purchaser has agreed or has deemed to agree pursuant to the terms of Section 2.3 to
accept title subject to and in accordance with this Agreement, without any adjustment to
the Purchase Price. 

        1.4        Purchase
Price.    Seller is to sell and Purchaser is to purchase the Property for a total of Seven
Million Seven Hundred Fifty Thousand and 00/100 Dollars ($7,750,000) (the “Purchase
Price”). The Purchase Price shall be paid to Seller at Closing (hereinafter
defined). 

        1.5        Earnest
Money.    Within three (3) business days after the execution and delivery of this Agreement,
Purchaser shall deposit with First American Title Insurance Company (the “Escrow
Agent”), having its office at 401 E. Pratt Street, Suite 323, Baltimore, Maryland
21202, Attention: Joseph Reineberg, the sum of Two Hundred Fifty Thousand and 00/100
Dollars ($250,000) (the “Initial Earnest Money”) in good funds, either by
certified bank or cashier’s check or by federal wire transfer. On or before the
expiration of the Inspection Period (as hereinafter defined) and provided Purchaser has
not terminated this Agreement pursuant to Section 3.2 hereof, Purchaser shall make an
additional deposit with the Escrow Agent in the amount of Seven Hundred Fifty Thousand
Dollars ($750,000) (the “Additional Earnest Money”, the Initial Earnest Money
and the Additional Earnest Money are hereinafter collectively referred to as the “Earnest
Money”) and upon expiration of the Inspection Period, if Purchaser has not
terminated this Agreement, the Earnest Money shall be non-refundable (except in the case
of (i) a failure of a condition precedent to Purchaser’s obligation to proceed to
Closing set forth in Section 4.6, (ii) a default by Seller under Section 6.2, (iii) a
termination of this Agreement by Purchaser pursuant to Section 2.3.3, or (iv) any other
provision of this Agreement pursuant to which Purchaser shall be entitled to a return of
the Earnest Money following a termination hereof). The Escrow Agent shall hold the
Earnest Money in an interest-bearing account in accordance with the terms and conditions
of an escrow agreement in a form reasonably acceptable to Seller, Purchaser and Escrow
Agent entered into among Seller, Purchaser and Escrow Agent simultaneously with the
execution of this Agreement. All interest accruing on such sum shall become a part of the
Earnest Money and shall be distributed as Earnest Money in accordance with the terms of
this Agreement. 

2

        1.6        Independent
Contract Consideration.    In addition to the Earnest Money, Purchaser shall, concurrently
with its execution hereof, deliver to Seller a check in the amount of ONE HUNDRED AND
NO/100 DOLLARS ($100.00), which amount Seller and Purchaser agree has been bargained for
as consideration for Seller’s execution and delivery of this Agreement and Purchaser’s
right to inspect the Property pursuant to Article 3. Such sum is in addition to and
independent of any other consideration or payment provided for in this Agreement and is
non-refundable in all events. 

ARTICLE 2

TITLE, SURVEY AND ENVIRONMENTAL

        2.1
        Title Examination; Commitment
for Title Insurance.    Purchaser shall have until the
expiration of the Inspection Period to examine title to the Property. During the
Inspection Period, Purchaser may, at its option, obtain from Escrow Agent
sometimes hereinafter referred to as the “Title Company” at
Purchaser’s expense, an ALTA title insurance commitment (the “Title
Commitment’) covering the Property, showing all matters affecting title to
the Property and binding the Title Company to issue at Closing an Owner’s
Policy of Title insurance in the full amount of the Purchase Price. If Purchaser
desires to obtain a Title Commitment, Purchaser shall cause the Title Commitment
to be issued within thirty (30) days after the effective date. 

        2.2        Survey.
    During the Inspection Period, Purchaser may, at its
option, employ a surveyor or surveying firm (the “Surveyor”), licensed
by the state in which the Property is located, to survey the Property and
prepare a survey thereof (the “Survey”). If Purchaser desires to
obtain a Survey, Purchaser shall cause the Survey to be prepared within thirty
(30) days after the Effective Date. 

        2.3
        Title/Survey Objections: Cure
of Title/Survey Objections.    Purchaser shall have
until the earlier of (i) ten (10) days after Purchaser’s receipt of both
the Title Commitment and the Survey or (ii) expiration of the Inspection Period
to give written notice to Seller of such objections as Purchaser may have to any
exceptions to title disclosed in the Title Commitment or the Survey. Any notice
of objections sent by Purchaser to Seller shall be accompanied by a copy of the
Survey and a copy of the Title Commitment together with any instrument that is
the subject of Purchaser’s notice of objections. Any exception to title
disclosed in the Title Commitment or the Survey to which Purchaser does not
object by timely written notice shall be a Permitted Exception. 

                        2.3.2         In
the event Purchaser gives timely written notice of objection to any exceptions to title,
Seller shall have the right, but not the obligation, to attempt to remove, satisfy or
otherwise cure any exceptions to title so objected to. Within ten (10) days after receipt
of Purchaser’s notice of objection, (“Seller’s Title Cure Period”)
Seller shall give written notice to Purchaser informing Purchaser of Seller’s
election with respect to such exceptions. If Seller fails to give written notice of
election within such ten (10) day period, Seller shall be deemed to have elected not to
attempt to cure the matter objected to. If Seller elects to attempt to cure any
exceptions, Seller shall be entitled to one or more reasonable adjournments of the
Closing of up to, but not beyond, the sixtieth (60th) day following the date for Closing
set forth in Section 4.1 hereof to attempt such cure. 

3

                        2.3.3         If
Seller elects or is deemed to have elected not to cure any exceptions to title objected
to by Purchaser or if, after electing to attempt to cure, Seller determines that it is
unwilling or unable to remove, satisfy or otherwise cure any such exceptions, Purchaser’s
sole remedy hereunder in such event shall be either: (i) to accept title to the Property
subject to such exceptions as if Purchaser had not objected thereto and without reduction
of the Purchase Price or (ii) to terminate this Agreement, whereupon the Escrow Agent
shall return the Earnest Money to Purchaser and the parties hereto shall be relieved of
all further liability and/or obligation hereunder. Seller shall be deemed to have cured
any such exception if the Title Company agrees to affirmatively insure over such
exception. 

                        2.3.4         To
terminate this Agreement pursuant to this Section 2.3, Purchaser must give written notice
to Seller of its election to terminate not later than (i) five (5) business days after
receipt of written notice from Seller of Seller’s election not to attempt to cure
any exception or of Seller’s determination, having previously elected to attempt to
cure, that it is unable or unwilling to do so or (ii) five (5) days after expiration of
Seller’s Title Cure Period if Seller is deemed herein to have elected not to attempt
to cure such exception. If Purchaser fails to give timely notice of its election to
terminate for any reason whatsoever such exception shall be deemed to be a Permitted
Exception. 

        2.4         Conveyance
of Title.    At Closing, Seller shall convey and transfer to Purchaser all of Seller’s
right, title and interest in and to the Property. Notwithstanding anything contained
herein to the contrary, the Property shall be conveyed subject to the following matters,
which shall be deemed to be “Permitted Exceptions” for purposes hereof: 

                        2.4.1         the
rights of tenants under the Leases;

                        2.4.2         the
lien of all ad valorem real estate taxes and assessments not yet due and payable as of
the date of Closing, subject to adjustment as herein provided; and 

                        2.4.3         items
which are or become Permitted Exceptions pursuant to Section 2.3 hereof. 

        2.5         Environmental
Assessment.    Purchaser may, at its option, also obtain, at Purchaser’s expense, an
environmental assessment covering the Property (the “Environmental Report”).
Purchaser shall, at any time prior to expiration of the Inspection Period, give written
notice to Seller of any matter disclosed by such Environmental Report which Purchaser
determines to be unacceptable. In the event that Seller fails to cure or correct such
unacceptable environmental condition on or before Closing, Purchaser may (i) terminate
this Agreement, whereupon the Escrow Agent shall promptly return the Earnest Money to
Purchaser, and the parties hereto shall thereafter be relieved of all further liability
and/or obligation hereunder or (ii) withdraw its objection and proceed to Closing
notwithstanding such unacceptable environmental condition. 

4

        2.6         No
Change in Status. Seller shall not cause or permit the status of title to, or the
environmental condition of, the Property to be modified in any way subsequent to the date
of this Agreement without the prior written consent of the Purchaser. 

ARTICLE 3

INSPECTION PERIOD

        3.1
        Right of
Inspection.    During the period beginning upon the
Effective Date and ending at 5:00 p.m. (local time at the Property) on
_______________, 2004 [forty-five (45) days following the date of this
Agreement] (hereinafter referred to as the “Inspection Period”),
Purchaser shall have the right to make a physical inspection of the Property,
including, without limitation, causing the Environmental Report to be issued,
and to examine during Seller’s normal business hours, at such place or
places at the Property, in the offices of the property manager or elsewhere as
the same may be located, any operating files maintained by Seller or its
property manager in connection with the redevelopment, leasing, maintenance
and/or management of the Property, including, without limitation, the Leases,
lease files, Operating Agreements, insurance policies, bills, invoices, receipts
and other general records relating to the income and expenses of the Property,
correspondence, surveys, engineering reports, plans and specifications,
warranties for services and materials provided to the Property, and
environmental audits and similar materials. Any inspections by Purchaser shall
be conducted only during Seller’s normal business hours and upon at least
24 hours prior notice to Seller. Purchaser will use commercially reasonable
efforts to perform its inspections in a manner that does not materially
interfere with Seller’s business operations being conducted upon the
Property. Purchaser shall be entitled to conduct invasive testing on the
Property with Seller’s prior written consent, which consent shall not be
unreasonably withheld, conditioned or delayed. Purchaser agrees to repair any
damage to the Property caused by Purchaser and to indemnify against and hold
Seller harmless from any claim for liabilities, costs, expenses (including
reasonable attorneys’ fees actually incurred) damages or injuries arising
out of or resulting from the inspection or testing of the Property by Purchaser
or its agents, and notwithstanding anything to the contrary in this Agreement,
such obligation to indemnify and hold harmless Seller shall survive Closing or
any termination of this Agreement. Purchaser shall maintain public liability and
property damage insurance in the amount of $1,000,000, and automobile liability
insurance in an amount not less than $1,000,000 which insurance coverage shall
name Seller as an additional insured and which insurance coverage shall
otherwise be in form and substance satisfactory to Seller and adequate to insure
against all liability of Purchaser and its consultants, respectively, and each
of its agents, employees or contractors, arising out of the inspections or
testing. All inspections and testing shall occur at reasonable times agreed upon
by Seller and Purchaser and shall be conducted so as not to interfere
unreasonably with use of the Property by Seller or its tenants. 

        3.2         Right
of Termination.    Seller agrees that in the event Purchaser determines (such determination
to be made in Purchaser’s sole and absolute discretion) that the Property is not
suitable for its purposes, Purchaser shall have the right to terminate this Agreement by
giving written notice thereof to Seller prior to the expiration of the Inspection Period.
If Purchaser gives such notice of termination within the Inspection Period, this
Agreement shall terminate and the Earnest Money shall be returned to Purchaser. Time is
of the essence with respect to the provisions of this Section 3.2. If Purchaser fails to
give Seller a notice of termination prior to the expiration of the Inspection Period,
Purchaser shall no longer have any right to terminate this Agreement under this Section
3.2, and the Earnest Money shall be non-refundable (except as otherwise provided herein).
Upon any termination of this Agreement by Purchaser, Purchaser shall deliver to Seller
copies of any Environmental Report and any other nonproprietary, nonconfidential reports,
tests, or studies with respect to the Property prepared by or on behalf of Purchaser. 

5

        3.3
        Seller
Lease.    Seller and Purchaser agree to act in good
faith to agree upon the terms and conditions of a triple net lease between
Seller, as tenant, and Purchaser, as landlord, for approximately 101,000 square
feet of space on the Property (the “Seller Lease”), which terms and
conditions will include, but shall not be limited to (i) a lease term of two (2)
years beginning with the date of Closing, (ii) base rent equal to $8.00 per
leasable square foot of space on a triple net basis, with Seller being
responsible for all its proportionate share of operating costs, including,
without limitation, utilities, real estate taxes and insurance and all
maintenance and, repair costs (including elevators) except that Purchaser shall
be responsible for roof repair and maintenance and all other capital repairs or
replacements (including floors, slabs, foundations and structural elements of
the Property), and (iii) an agreement by Purchaser that it will not
intentionally take any action that would materially adversely impact
Seller’s business during the lease term (with the understanding that
Seller, as tenant, is solely responsible for compliance with all laws, rules and
regulations applicable to its business). 

ARTICLE 4

CLOSING

        4.1        Time
and Place.    The Closing shall be held at the offices of Gallagher Evelius & Jones LLP,
218 North Charles Street, Suite 400, Baltimore, Maryland 21201, on a date selected by
Purchaser with at least five (5) days prior notice to Seller not later than the thirtieth
(30th) day following the expiration of the Inspection Period. At Closing, Seller and
Purchaser shall perform the obligations set forth in, respectively, Section 4.2 and
Section 4.3. 

        4.2        Seller's
Obligations at Closing.    At Closing, Seller shall:

                        4.2.1         deliver
to Purchaser a duly executed special warranty deed (the “Deed”) in recordable
form, conveying the applicable portion of the Land and Improvements, subject only to the
Permitted Exceptions; 

                        4.2.2         deliver
to Purchaser a duly executed bill of sale conveying the applicable Personal Property
without warranty of title or use and without warranty, expressed or implied, as to
merchantability and fitness for any purpose Purchaser acknowledges that it is accepting
all such Personal Property “AS IS” and “WHERE IS”; 

6

            
            4.2.3         assign
to Purchaser, and Purchaser shall assume, the landlord/lessor interest in and to the
applicable Leases by duly executed assignment and assumption agreement pursuant to which
(i) Seller shall indemnify Purchaser and hold Purchaser harmless from and against any and
all claims pertaining to the Leases arising prior to Closing and (ii) Purchaser shall
indemnify Seller and hold Seller harmless from and against any and all claims pertaining
to the Leases arising from and after the Closing; 

                        4.2.4         assign
to Purchaser, and Purchaser shall assume, Seller’s interest in the applicable
Operating Agreements and the other Intangibles (without any warranty of title or use) by
duly executed assignment and assumption agreement pursuant to which (i) Seller shall
indemnify Purchaser and hold Purchaser harmless from and against any and all claims
pertaining to the Operating Agreements or the other Intangibles arising prior to Closing
and (ii) Purchaser shall indemnify Seller and hold Seller harmless from and against any
and all claims pertaining to the Operating Agreements or the other Intangibles arising
from and after the Closing; 

                        4.2.5         join
with Purchaser to execute a notice in form and content reasonably satisfactory to
Purchaser and Seller which Purchaser shall send to each tenant under each of the Leases
informing such tenant of the sale of the Property and of the assignment to Purchaser of
Seller’s interest in, and obligations under, the Leases (including, if applicable,
Purchaser’s assumption of Seller’s obligations with respect to any security
deposits) and directing that all rent and other sums payable after the Closing under each
such Lease shall be paid as set forth in the notice; 

                        4.2.6         deliver
to Purchaser a certificate, dated as of the date of Closing and executed on behalf of
Seller by a duly authorized officer thereof, stating that the representations and
warranties of Seller contained in this Agreement are true and correct in all material
respects as of the date of the applicable Closing (with appropriate modifications of
those representations and warranties made in Section 5.1 hereof to reflect any material
changes therein including without limitation any changes resulting from actions under
Section 5.4 hereof) or identifying any representation or warranty which is not, or no
longer is, true and correct and explaining the state of facts giving rise to the change (“Seller’s
Closing Certificate”); 

                        4.2.7         deliver
to Purchaser such evidence as Purchaser’s counsel and/or the Title Company may
reasonably require as to the authority of the person or persons executing documents on
behalf of Seller; 

             
           4.2.8         deliver
to Purchaser an affidavit duly executed by Seller stating that Seller is not a “foreign
person”as defined in the Federal Foreign Investment in Real Property Tax Act of 1980
and the 1984 Tax Reform Act; 

            
            4.2.9         deliver
to Purchaser the applicable Leases, Operating Agreements and licenses and permits, if
any, in the possession of Seller or Seller’s agents, together with such leasing and
property files and records which are material in connection with the continued operation,
leasing and maintenance of the Property; 

7

                        4.2.10         execute
and deliver the Seller Lease; and

                        4.2.11         deliver
such additional documents as shall be reasonably required to consummate the transaction
contemplated by this Agreement. 

        4.3        Purchaser's
Obligations at Closing.    At Closing, Purchaser shall:

                        4.3.1         pay
to Seller the full amount of the Purchase Price, as increased or decreased by prorations
and adjustments as herein provided, in immediately available wire transferred funds
pursuant to Section 1.5 above, it being agreed that at Closing the Earnest Money shall be
delivered to Seller and applied towards payment of the Purchase Price; 

                        4.3.2         join
Seller in execution of the instruments described in Subsections 4.2.3, 4.2.4, and 4.2.5
above;

                        4.3.3         deliver
to Seller such evidence as Seller’s counsel and/or the Title Company may reasonably
require as to the authority of the person or persons executing documents on behalf of
Purchaser; 

                        4.3.4         execute
and deliver the Seller Lease; and

                        4.3.5         deliver
such additional documents as shall be reasonably required to consummate the transaction
contemplated by this Agreement. 

        4.4        Credits
and Prorations.

                        4.4.1         The
following shall be apportioned with respect to the Property as of 12:01 a.m., on the day
of the applicable Closing, as if Purchaser were vested with title to the Property during
the entire day upon which such Closing occurs: (i) rents, if any, as and when collected
(the term “rents” as used in this Agreement includes all payments due and
payable by tenants under the Leases and shall take into account any concessions relating
to any Lease), (ii) taxes (including personal property taxes on the Personal Property)
and assessments levied against the Property, (iii) payments under the Operating
Agreements, (iv) gas, electricity and other utility charges for which Seller is liable,
if any, such charges to be apportioned at Closing on the basis of the most recent meter
reading occurring prior to Closing, and (v) any other operating expenses or other items
pertaining to the Property which are customarily prorated between a purchaser and a
seller in the area in which the Property is located. 

                        4.4.2         At
Closing, (i) Seller shall, at Purchaser’s option, either deliver to Purchaser any
security deposits actually held by Seller pursuant to the Leases or credit to the account
of Purchaser the amount of such security deposits (to the extent such security deposits
are not applied against delinquent rents or otherwise applied as contemplated), and (ii)
Purchaser shall credit to the account of Seller all refundable cash or other deposits
posted with utility companies serving the Property, or, at Seller’s option, Seller
shall be entitled to receive and retain such refundable cash and deposits. 

8

                        4.4.3         Any
taxes paid at or prior to Closing shall be prorated based upon the amounts actually paid.
If taxes and assessments for the current year have not been paid before Closing, Seller
shall be charged at Closing an amount equal to that portion of such taxes and assessments
which relates to the period before Closing and Purchaser shall pay the taxes and
assessments prior to their becoming delinquent. Any such apportionment made with respect
to a tax year for which the tax rate or assessed valuation, or both, have not yet been
fixed shall be based upon the tax rate and/or assessed valuation last fixed. To the
extent that the actual taxes and assessments for the current year differ from the amount
apportioned at Closing, the parties shall make all necessary adjustments by appropriate
payments between themselves following Closing provided; however, that Seller shall not be
responsible for any increased taxes or assessments resulting from an increase in the
assessed value of the Land or the Improvements first resulting from and after the day of
Closing or otherwise resulting from the sale of the Property. 

                        4.4.4         Discounts
for the prepayment of any taxes, water rates or sewer rents shall be prorated as of the
day of Closing. 

                        4.4.5         As
to gas, electricity and other utility charges referred to in Subsection 4.4.1(iv) above,
Seller may on notice to Purchaser elect to pay one or more of all of said items accrued
to the date hereinabove fixed for apportionment directly to the person or entity entitled
thereto, and to the extent Seller so elects, such item shall not be apportioned
hereunder, and Seller’s obligation to pay such item directly in such case shall
survive the applicable Closing. 

                        4.4.6         The
Personal Property is included in this sale, without further charge, except that Purchaser
shall pay to Seller the amount of any and all sales or similar taxes payable in
connection with the Personal Property and Purchaser shall execute and deliver any tax
returns required of it in connection therewith, said obligations of Purchaser to survive
Closing. 

                        4.4.7         Unpaid
and delinquent rent collected by Seller and Purchaser after the date of Closing shall be
delivered as follows: (i) if Seller collects any unpaid or delinquent rent for the
Property, Seller shall, within fifteen (15) days after the receipt thereof, deliver to
Purchaser any such rent which Purchaser is entitled to hereunder relating to the date of
Closing and any period thereafter, and (ii) if Purchaser collects any unpaid or
delinquent rent from the Property, Purchaser shall, within fifteen (15) days after the
receipt thereof, deliver to Seller any such rent which Seller is entitled to hereunder
relating to the period prior to the date of Closing. Seller and Purchaser agree that
(iii) all rent received by Seller or Purchaser within the first sixty (60) day period
after the date of Closing shall be applied first to delinquent rentals, if any, in the
order of their maturity, and then to current rentals, and (iv) all rent received by
Seller or Purchaser after the first sixty (60) day period after the date of Closing shall
be applied first to current rentals and then to delinquent rentals, if any, in inverse
order of maturity. Purchaser will make a good faith effort after Closing to collect all
rents in the usual course of Purchaser’s operation of the Property, but Purchaser
will not be obligated to institute any lawsuit or other collection procedures to collect
delinquent rents. 

9

             
           4.4.8         Either
party shall be entitled to a post-Closing adjustment for any incorrect proration or
adjustment provided written notice thereof is given to the other party within sixty (60)
days of Closing (or such longer period with respect to adjustments not capable of being
made or determined within such sixty (60) day period). 

             
           4.4.9        
The provisions of this Section 4.4 shall survive Closing for a period of sixty
(60) days (or, in the case of adjustments requiring a longer time in order to
make a final determination as described in Section 4.4.8, such longer period of
time). 

        4.5        
Closing Costs.    Seller shall pay (i) the fees of
any counsel representing it in connection with this transaction; (ii) one-half
(1/2) of any escrow fee which may be charged by the Escrow Agent or Title
Company; and (iii) one-half (1/2) of all transfer and recordation taxes due and
payable in connection with this transaction. Purchaser shall pay (iv) one-half
(1/2) of all transfer and recordation taxes due and payable in connection with
the transfer of the Property; (v) the fees of any counsel representing Purchaser
in connection with this transaction; (vi) the fee for the title examination and
the Title Commitment and the premium for the Owner’s Policy of Title
Insurance to be issued to Purchaser by the Title Company at Closing; (vii) the
cost of the Survey; (viii) the fees for recording any documents conveying the
Property to Purchaser; and (ix) one-half (1/2) of any escrow fees charged by the
Escrow Agent or Title Company. All other costs and expenses incident to this
transaction and the closing thereof shall be paid by the party incurring same.

        4.6
        Conditions Precedent to
Obligation of Purchaser.    The obligation of Purchaser
to consummate the transaction hereunder shall be subject to the fulfillment on
or before the date of Closing of all of the following conditions, any or all of
which may be waived by Purchaser in its sole discretion: 

                        4.6.1         Seller
shall have delivered to Purchaser all of the items required to be delivered to Purchaser
pursuant to the terms of this Agreement, including but not limited to, those provided for
in Section 4.2. 

                        4.6.2         All
of the representations and warranties of Seller contained in this Agreement shall be true
and correct in all material respects as of the date of Closing (with appropriate
modifications permitted under this Agreement or not materially adverse to Purchaser). 

           
             4.6.3         Seller
shall have performed and observed, in all material respects, all covenants and agreements
of this Agreement to be performed and observed by Seller as of the date of Closing. 

                        4.6.4         Seller
and Purchaser shall have entered into the Seller Lease.

        In the event any of the
foregoing conditions are not fulfilled or waived by Purchaser by Closing, this
Agreement may, at Purchaser’s option, terminate and the Earnest Money shall
be returned to Purchaser. 

10

        4.7         Conditions
Precedent to Obligation of Seller.     The obligation of Seller to consummate the transaction
hereunder shall be subject to the fulfillment on or before the date of Closing of all of
the following conditions, any or all of which may be waived by Seller in its sole
discretion: 

                        4.7.1         Seller
shall have received the Purchase Price as adjusted pursuant to and payable in the manner
provided for in this Agreement. 

            
            4.7.2         Purchasershall have delivered to Seller all of the items required to be delivered to Seller
pursuant to the terms of this Agreement, including but not limited to, those provided for
in Section 4.3. 

                        4.7.3         All
of the representations and warranties of Purchaser contained in this Agreement shall be
true and correct in all material respects as of the date of Closing. 

                        4.7.4         Purchaser
shall have performed and observed, in all material respects, all covenants and agreements
of this Agreement to be performed and observed by Purchaser as of the date of Closing. 

ARTICLE 5

REPRESENTATIONS, WARRANTIES AND COVENANTS

        5.1         Representations
 and Warranties of Seller.    Seller hereby makes the following  representations  and
warranties to Purchaser as of the Effective Date and as of the date of Closing:

            
             5.1.1
        Organization and
Authority.    Seller is validly existing under the laws
of Indiana. Seller has the full right and authority to enter into this Agreement
and to transfer all of the Property to be conveyed by Seller pursuant hereto and
to consummate or cause to be consummated the transactions contemplated herein to
be made by Seller. 

             
           5.1.2  
       Pending
Actions.    There is no action, suit, arbitration, unsatisfied order or judgment,
governmental investigation or proceeding pending against the Property or the transaction
contemplated by this Agreement, which, if adversely determined, could individually or in
the aggregate have a material adverse effect on title to the Property or any portion
thereof, which could in any material way interfere with the consummation by Seller of the
transaction contemplated by this Agreement or which would impact Seller’s ability to
perform under the Seller Lease. 

            
            5.1.3
        Leases.    Except
as set forth in the Rent Roll, (i) there are no other leases or occupancy
agreements to which Seller is a party affecting the Property, (ii) all Leases
are in full force and effect, and (iii) there exists no default under any Lease.

             
           5.1.4  
       No Violations.    Seller has not received prior to the Effective Date any written notification
from any governmental or public authority, nor does Seller otherwise have knowledge, that
the Property is in violation of any applicable fire, health, building, use, occupancy or
zoning laws where such violation remains outstanding and, if unaddressed, would have a
material adverse effect on the use of the Property as currently owned and operated.
Seller has received all permits, approvals and consents necessary to own the Property and
operate its business. Seller has provided to Purchaser during the Inspection Period
copies of all reports and communications from consultants and professionals (i.e.,
architects and engineers) relating to the structural, environmental and operational
condition and status of the Property. 

11

             
           5.1.5  
       Taxes
and Assessments.    Seller has not filed, and has not retained anyone to file, notices of
protests against, or to commence action to review, real property tax assessments against
the Property, which protests or actions are still unresolved. 

             
           5.1.6  
       Condemnation.    
No condemnation proceedings relating to the Property are pending nor has Seller received
any written notice of any threatened condemnation proceeding. 

             
           5.1.7  
       Insurance.    
Seller has not received any written notice from any insurance company or board of fire
underwriters of any defects or inadequacies in or on the Property or any part or
component thereof that would materially and adversely affect the insurability of the
Property or cause any material increase in the premiums for insurance for the Property
that have not been cured or repaired. 

             
           5.1.8  
       Environmental Matters.    To the best of Seller’s knowledge, the Property is in compliance in all
material respects with all applicable federal, State, and local laws, ordinances and
regulations relating to air, water or noise pollution, or the production, storage,
labeling or disposition or release of Hazardous Materials (as hereinafter defined) or
Solid Wastes (as hereinafter defined) or the health, safety or environmental conditions
on, under or about the Property, including, without limitation, soil and groundwater
conditions (collectively, “Environmental Laws”). No Hazardous Materials or
Solid Wastes have been or are currently on, under or about the Property. The term “Hazardous
Materials” as used in this Agreement shall mean any and all substances subject to
governmental regulation of any type, or which could subject Purchaser to liability of any
type, including, but not limited to, “hazardous substances,” “hazardous
waste,” “hazardous materials,” “pollutants,”“contaminants” or
“toxic substances” in the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended, 42 U.S.C. Section 9601, et seq.; the Hazardous
Materials Transportation Act, 49 U.S.C. Section 1801 et seq.; the Resource Conservation
and Recovery act, 42 U.S.C. Section 6901, et seq.; “hazardous chemicals” as
defined under OSHA’s hazard communication standard, 29 C.F.R. §1910.1200; and
those substances defined as “hazardous wastes” or as “hazardous substances” under
the laws of the State of Maryland; and in the regulations adopted, published and/or
promulgated pursuant to such laws. Hazardous Materials does not include materials
ordinarily and customarily used, stores, present or handled in the regular operation of
the multi-family apartment complexes, including but not limited to maintenance and
custodial supplies all in amounts permitted by applicable law. The term “Solid Wastes” as
used in the Agreement shall mean any and all substances subject to governmental
regulation of any type or which could subject Purchaser or the Partnership to liability
of any type, including, but not limited to, “solid wastes” as defined in the
Resource conservation and Recovery Act or under the laws of the State of Maryland. Seller
has not received any written notice from any governmental agency or private or public
entity advising that Seller is responsible for or potentially responsible for response
costs or response actions with respect to a release, a threatened release or cleanup of
substances produced by, or resulting from, any business, commercial or industrial
activities, operations or processes related to the Property or the Seller or any of their
respective predecessors. 

12

             
           5.1.9  
       Collective Bargaining Agreements; Pension Plans.    No collective bargaining agreements between Seller
and any labor organization apply to the operation and/or management of the Property, and
no pension, retirement, profit-sharing or similar plan or fund, ERISA qualified or
otherwise, has been established by Seller in connection with the Property and no
liabilities for pension or retirement payments exist in connection therewith. 

             
           5.1.10  
       No
Default.    Seller is not in default of any material
covenant, condition, restriction, right of way, easement, mortgage, deed of
trust, lien or license affecting the Property that is to be complied with by
Seller. 

             
           5.1.11  
       No Options or Rights of
Purchase.    No person other than Purchaser has an
option or right to purchase any or all of the Property. 

             
           5.1.12  
       No
Bankruptcy.    No petition in bankruptcy (voluntary or
involuntary) or for the appointment of a receiver or trustee has been filed by
or against Seller or is contemplated by Seller. 

             
           5.1.13  
       No Other
Violations.    To the best of Seller’s knowledge,
this Agreement does not violate the terms of any other contract or agreement to
which Seller is a party. 

             
           5.1.14  
       Seller’s
Representative.    As used herein, the terms “to
the best of Seller’s knowledge” and “Seller’s
knowledge” shall be limited to the actual knowledge of Peter Kissinger,
Michael Silvon, and Michael Cox. 

        5.2     
    Survival
of Seller’s Representations and Warranties.    The representations and warranties of
Seller set forth in Section 5.1 as updated by Seller’s Closing Certificate to be
delivered to Purchaser at Closing in accordance with Subsection 4.2.6 hereof, shall
survive the Closing for a period of one (1) year. 

        5.3    
    Operating Covenant of
Seller.    Seller hereby covenants with Purchaser to use
reasonable efforts to operate and maintain the Property in a manner generally
consistent with the manner in which Seller has operated and maintained the
Property or caused the Property to be operated and maintained until the Closing
or earlier termination of this Agreement, including, without limitation, with
respect to Hazardous Materials. 

        5.4    
    Representations
and Warranties of Purchaser.    Purchaser hereby represents and warrants to Seller:

13

             
           5.4.1 
       Purchaser
has the full right, power and authority to purchase the Property as provided in this
Agreement and to carry out Purchaser’s obligations hereunder, and all requisite
action necessary to authorize Purchaser to enter into this Agreement and to carry out its
obligations hereunder have been, or by the Closing will have been, taken. The person
signing this Agreement on behalf of Purchaser is authorized to do so. 

                        5.4.2         There
is no action, suit, arbitration, unsatisfied order or judgment, government investigation
or proceeding pending against Purchaser which, if adversely determined, could
individually or in the aggregate materially interfere with the consummation of the
transaction contemplated by this Agreement. 

             
           5.4.3         Purchaser
has not established any pension plan for employees which would cause Purchaser to be
subject to the Employee Retirement Income Security Act of 1974, as amended. 

        5.5
        Survival of Purchaser’s
Representations and Warranties.    The representation
and warranties of Purchaser set forth in Subsection 5.5 shall survive Closing
and shall be a continuing representation and warranty without limitation. All
other representations and warranties of Purchaser shall survive Closing for a
period of one (1) year. 

ARTICLE 6

DEFAULT

        6.1         Default
by Purchaser.    If Purchaser fails to perform any of its obligations under this Agreement
and such default continues for a period of ten (10) days after written notice from
Purchaser (provided, however, that in no circumstance shall Purchaser be entitled to
notice or any cure period in connection with Purchaser’s failure to proceed to
Closing under this Agreement) for any reason other than Seller’s default or the
permitted termination of this Agreement by either Seller or Purchaser as herein expressly
provided, Seller shall be entitled, as its sole remedy, to terminate this Agreement and
receive the Earnest Money as liquidated damages for the breach of this Agreement, it
being agreed between the parties hereto that the actual damages to Seller in the event of
such breach are impractical to ascertain and the amount of the Earnest Money is a
reasonable estimate thereof, 

        6.2        Default
by Seller.    In the event that Seller fails to perform any of its obligations under this
Agreement and such default continues for a period of ten (10) days after written notice
from Purchaser (provided, however, that in no circumstance shall Seller be entitled to
notice or any cure period in connection with Seller’s failure to proceed to Closing
under this Agreement), Purchaser shall be entitled, as its sole remedy, either (a) to
receive the return of the Earnest Money, which return shall operate to terminate this
Agreement and release Seller and Purchaser from any and all liability and/or obligation
hereunder, or (b) to enforce specific performance of Seller’s obligation to execute
the documents required to convey the Property to Purchaser, so long as a suit for
specific performance is commenced by Purchaser no more than one hundred eighty (180) days
after the scheduled date of Closing, it being understood and agreed that the remedy of
specific performance shall not be available to enforce any other obligation of Seller
hereunder, in which case Purchaser shall be entitled to recover its reasonable actual out
of pocket costs and expenses related to Sellers default, not to exceed $100,000. No
provision of this Agreement, including, without limitation, this Section 6.2, shall be
deemed to modify or limit Seller’s indemnity obligations or liability set forth
herein, including, as set forth in Section 9.1. 

14

ARTICLE 7

RISK OF LOSS

        7.1         Minor
Damage.    In the event of loss or damage to the Property or any portion thereof which is
not a Major Loss (as hereinafter defined), this Agreement shall remain in full force and
effect provided Seller performs any necessary repairs or, at Seller’s option,
assigns to Purchaser all of Seller’s right, title and interest to any claims and
proceeds Seller may have with respect to any casualty insurance policies or condemnation
awards relating to the premises in question. In the event that Seller elects to perform
repairs upon the Property, Seller shall use reasonable efforts to complete such repairs
promptly and the date of Closing shall be extended a reasonable time in order to allow
for the completion of such repairs. If Seller elects to assign a casualty claim to
Purchaser, the Purchase Price shall be reduced by an amount equal to the deductible
amount under Seller’s insurance policy, if any, attributable to such claim. Upon
Closing, full risk of loss with respect to the Property shall pass to Purchaser. 

        7.2        Major
Damage.    In the event of a Major Loss, either Seller or Purchaser may terminate this
Agreement by written notice to the other party, in which event the Earnest Money shall be
returned to Purchaser. If neither Seller nor Purchaser elects to terminate this Agreement
within ten (10) days after Seller sends Purchaser written notice of the occurrence of the
Major Loss, then Seller and Purchaser shall be deemed to have elected to proceed with
Closing, in which event Seller shall, at Seller’s option, either (i) perform any
necessary repairs, or (ii) assign to Purchaser all of Seller’s right, title and
interest to any claims and proceeds Seller may have with respect to any casualty
insurance policies or condemnation awards relating to the premises in question. In the
event that Seller elects to perform repairs upon the Property, Seller shall use
reasonable efforts to complete such repairs promptly and the date of Closing shall be
extended a reasonable time in order to allow for the completion of such repairs. If
Seller elects to assign a casualty claim to Purchaser, the Purchase Price shall be
reduced by an amount equal to the deductible amount under Seller’s insurance policy.
Upon Closing, full risk of loss with respect to the Property shall pass to Purchaser. 

        7.3         Definition
of “Major Loss”.    For purposes of Sections 7.1 and 7.2, “Major Loss” shall
mean: (i) loss or damage to the Property or any portion thereof such that the cost of
repairing or restoring the premises in question to a condition substantially identical to
that of the premises in question prior to the event of damage would be, in the opinion of
an architect selected by Seller and reasonably approved by Purchaser, equal to or greater
than FIVE HUNDRED THOUSAND DOLLARS ($500,000), and (ii) any loss due to a condemnation
which permanently and materially impairs the current use of the Property. If Purchaser
does not give notice to Seller of Purchaser’s reasons for disapproving an architect
within five (5) business days after receipt of notice of the proposed architect,
Purchaser shall be deemed to have approved the architect selected by Seller. 

15

ARTICLE 8

COMMISSIONS

        8.1         Brokerage
Commissions.    Seller shall pay a broker fee to CB Richard Ellis in connection with the
purchase and sale of the Property and shall indemnify and hold Purchaser harmless from
and against any and all claims related thereto. Each party agrees that should any claim
be made for brokerage commissions or finder’s fees by any broker or finder by,
through or on account of any acts of said party or its representatives, said party will
indemnify and hold the other party free and harmless from and against any and all loss,
liability, cost, damage and expense in connection therewith. The provisions of this
paragraph shall survive Closing. 

ARTICLE 9

MISCELLANEOUS

        9.1         Indemnification.
Seller shall indemnify, defend Purchaser, its successors, assigns, members, agents and
employees (the “Indemnified Parties”) (with counsel acceptable to Purchaser)
harmless from and against any and all liabilities, damages, losses, claims, demands,
judgments, fines, penalties, settlement amounts, payments of amounts demanded, costs and
expenses (including, without limitation, reasonable attorneys’ fees and litigation
costs) and claims which the Indemnified Parties may incur, including, but not limited to,
in connection with any proceeding arising out of or resulting from (i) any claims due to
or arising out of death or injury to persons, or damage to the property, which were
sustained prior to the Closing as a result of, or alleged to have been sustained prior to
the Closing as a result of, the operation, use, condition and/or upkeep of the Property
prior to the Closing; (ii) liability for federal, state or local income taxes, payroll
taxes and property taxes attributable to periods prior to the date of Closing; (iii) any
loss, liability, claim or action to which Purchaser is subjected as a result of any and
all business done, transactions entered into, or other actions taken by Seller, its
agents, employees and contractors; and (iv) any breach by Seller of any representation,
warranty, or covenant made by Seller in this Agreement. The foregoing indemnity shall
survive the Closing for a period of two (2) years. 

        9.2         Public
Disclosure.    Prior to and after Closing, any release to the public of information with
respect to the sale contemplated herein or any matters set forth in this Agreement will
be made only in the form approved by Purchaser and Seller and their respective counsel. 

        9.3         Assignment.
    Seller may not assign its rights under this Agreement without first obtaining Purchaser’s
written approval, which approval may be given or withheld in Purchaser’s sole
discretion. The assignment of any of Seller’s rights under this Agreement without
Purchaser’s prior written consent or any transfer, directly or indirectly, of any
stock, partnership interest or other ownership interest in Seller without Purchaser’s
written approval, which consent or approval, as the case may be, may be given or withheld
in Purchaser’s sole discretion, shall constitute a default by Seller under this
Agreement. 

16

             
           9.3.2
        Purchaser
shall give Seller prior written notice of any proposed assignment of this Agreement. Such
notice shall identify the proposed assignee or transferee and the constituent individuals
and/or entities thereof and such further information with respect to the proposed
assignee or transferee and the constituent individuals and/or entities thereof, as Seller
may request. Purchaser’s assignment or transfer of this Agreement shall not relieve
Purchaser of its obligations under this Agreement. 

        9.4         Notices.
Any notice pursuant to this Agreement shall be given in writing by (i) personal delivery,
or (ii) reputable overnight delivery service with proof of delivery, or (iii) United
States Mail, postage prepaid, registered or certified mail, return receipt requested, or
(iv) legible facsimile transmission sent to the intended addressee at the address set
forth below, or to such other address or to the attention of such other person as the
addressee shall have designated by written notice sent in accordance herewith, and shall
be deemed to have been given either at the time of personal delivery, or, in the case of
expedited delivery service or mail, as of the date of first attempted delivery at the
address and in the manner provided herein, or, in the case of facsimile transmission, as
of the date of the facsimile transmission provided that an original of such facsimile is
also sent to the intended addressee by means described in clauses (i), (ii) or (iii)
above. Unless changed in accordance with the preceding sentence, the addresses for
notices given pursuant to this Agreement shall be as follows: 

If to Seller:

Bioanalytical Systems, Inc.

300 W. Fayette Street

Baltimore, Maryland 21201

Fax:  (765) 497-1102

With a copy to:

Ice Miller

One American Square

Box 82001

Indianapolis, IN 46282

Attention:  Stephen Hackman, Esq.

Fax:  (317) 592-4666

If to Purchaser:

The Kevin F. Donohoe Company, Inc.

The Curtis Center, Suite 700

Independence Square West

Philadelphia, Pennsylvania 19106

Fax:  (215) 440-4010

With a copy to:

Gallagher Evelius & Jones LLP

218 N. Charles Street

Suite 400

Baltimore, Maryland 21201

Attention:  Mark P. Keener, Esq.

Fax:  (410) 468-2786

17

        9.5        Modifications.    
This Agreement cannot be changed orally, and no executory agreement shall be effective to
waive, change, modify or discharge it in whole or in part unless such executory agreement
is in writing and is signed by the parties against whom enforcement of any waiver,
change, modification or discharge is sought. 

        9.6         Calculation
of Time Periods.    Unless otherwise specified, in computing any period of time described in
this Agreement, 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 a Saturday, Sunday or legal holiday under the laws of
the State in which the Property is located, in which event the period shall run until the
end of the next day which is neither a Saturday, Sunday or legal holiday. The final day
of any such period shall be deemed to end at 5 p.m., local time. 

        9.7        Successors
and Assigns.    The terms and provisions of this Agreement are to apply to and bind the
permitted successors and assigns of the parties hereto. 

        9.8        Entire
Agreement.    This Agreement, including the Exhibits, contains the entire agreement between
the parties pertaining to the subject matter hereof and fully supersedes all prior
written or oral agreements and understandings between the parties pertaining to such
subject matter. 

        9.9        Further
Assurances.    Each party agrees that it will without further consideration execute and
deliver such other documents and take such other action, whether prior or subsequent to
Closing, as may be reasonably requested by the other party to consummate more effectively
the purposes or subject matter of this Agreement. Without limiting the generality of the
foregoing, Purchaser shall, if requested by Seller, execute acknowledgments of receipt
with respect to any materials delivered by Seller to Purchaser with respect to the
Property. The provisions of this Section 10.11 shall survive Closing. 

        9.10        Counterparts.    
This Agreement may be executed in counterparts, and all such executed counterparts shall
constitute the same agreement. It shall be necessary to account for only one such
counterpart in proving this Agreement. 

18

        9.11        Severability.    
If any provision of this Agreement is determined by a court of competent jurisdiction to
be invalid or unenforceable, the remainder of this Agreement shall nonetheless remain in
full force and effect. 

        9.12        Applicable
Law.    This Agreement is performable in the state in which the Property is located and
shall in all respects be governed by, and construed in accordance with, the substantive
federal laws of the United States and the laws of such state. Seller and Purchaser hereby
irrevocably submit to the jurisdiction of any state or federal court sitting in the state
in which the Property is located in any action or proceeding arising out of or relating
to this Agreement and hereby irrevocably agree that all claims in respect of such action
or proceeding shall be heard and determined in a state or federal court sitting in the
state in which the Property is located. Purchaser and Seller agree that the provisions of
this Section 10.14 shall survive the Closing of the transaction contemplated by this
Agreement. 

        9.13        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. 

        9.14        Exhibits
and Schedules.    The following schedules or exhibits attached hereto shall be deemed to be
an integral part of this Agreement: 

     
                                  (a)        
          Exhibit A — Legal Description of the Land

     
                                  (b)        
          Exhibit B — Rent Roll

     
                                  (c)        
          Exhibit C — Operating Agreements Schedule

        9.15        Captions.
The section headings appearing in this Agreement are for convenience of reference only
and are not intended, to any extent and for any purpose, to limit or define the text of
any section or any subsection hereof. 

        9.16        Construction.
The parties acknowledge that the parties and their counsel have reviewed and revised this
Agreement and 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. 

        9.17        Termination
of Agreement.    It is understood and agreed that if either Purchaser or Seller terminates
this Agreement pursuant to a right of termination granted hereunder, such termination
shall operate to relieve Seller and Purchaser from all obligations under this Agreement,
except for such obligations as are specifically stated herein to survive the termination
of this Agreement. 

19

        9.18        Survival.    
The provisions of this Article 10 and any other provisions of this Agreement which by
their terms are intended to be performed or be applicable after Closing shall survive
Closing or any termination of this Agreement prior thereto and shall not be merged into
the execution and delivery of the Deed. The foregoing is in addition to and not in
exclusion of any survival provisions elsewhere set forth in this Agreement. 

        9.19        No
Recordation.    Neither this Agreement nor any memorandum of the terms hereof shall be
recorded or otherwise placed of public record and any breach of this covenant shall,
unless the party not placing same of record is otherwise in default hereunder, entitle
the party not placing same of record to pursue its rights and remedies under Article 6. 

        9.20        Confidentiality.    
All information (collectively, “Inspection Material”) acquired by Purchaser or
any of its Representatives (as hereinafter defined) with respect to the Property, whether
delivered by Seller or any of its Representatives or obtained by Purchaser as a result of
its inspection of the Property, examination of Seller’s files or otherwise shall be
kept in confidence prior to Closing and shall not be disclosed prior to Closing to any
individual or entity other than those Representatives of Purchaser who need to know the
information for the purpose of assisting Purchaser in making a determination as to
whether the Property is suitable for Purchaser’s purpose. As used herein, “Representative” shall
mean any employee, officer, director, shareholder, owner, affiliate, agent or
representative of a party as well as Purchaser’s investors, potential investors,
lenders, potential lenders, consultants and attorneys for Purchaser and/or any and all of
the foregoing. In the event of a breach or threatened breach by Purchaser or its
Representatives of this Section 9.20, Purchaser acknowledges and agrees that such action
will cause irreparable harm to Seller for which any remedy at law will be inadequate, and
Seller shall be entitled to an injunction restraining Purchaser or its Representatives
from disclosing, in whole or in part, any Inspection Material. The provisions of this
Section shall not survive the Closing, but shall continue in full force and effect
notwithstanding the prior termination of this Agreement pursuant to any right of
termination granted herein or otherwise. 

[Signatures follow on next page]

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        IN WITNESS WHEREOF, the parties
hereto have duly executed this Agreement as of the Effective Date. 

	
 	
SELLER:

PKLB LIMITED PARTNERSHIP

By:  BASi MARYLAND, INC., General Partner

By:  /s/  Michael P. Silvon, Ph.D.

Name:  Michael P. Silvon, Ph.D.

Title:  Secretary

PURCHASER:

THE KEVIN F. DONOHOE COMPANY, INC.

By:  /s/  Henry B. Glover, Jr.

Name:  Henry B. Glover, Jr.

Title:  Vice President

21

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