Document:

Appendix A to the Indenture (Definitions)

 Exhibit 4.2 
  

APPENDIX A 
  
 DEFINITIONS 
  
 Accepted Master Servicing Practices: With respect to any Mortgage Loan, as applicable, those customary mortgage master servicing practices of prudent mortgage servicing institutions that master service mortgage loans of the same type
and quality as such Mortgage Loan in the jurisdiction where the related Mortgaged Property is located, to the extent applicable to the Master Servicer (except in its capacity as successor to the Servicer). 
  
 Accepted Servicing Practices: With respect to any Mortgage Loan, as
applicable, those customary mortgage servicing practices of prudent mortgage servicing institutions that service mortgage loans of the same type and quality as such Mortgage Loan in the jurisdiction where the related Mortgaged Property is located,
as provided in the Servicing Agreement to the extent applicable to the Servicer or the Subservicer. 
  
 Account: The Payment Account and the Custodial Account as the context may require. 
  
 Accrual Period: For any Class of Notes and any Payment Date, the period from and including the preceding Payment Date
(or, in the case of the first Payment Date, from and including the Closing Date) to and including the day prior to the current Payment Date. 
  
 Accrued Note Interest: With respect to any Payment Date and each Class of Notes, interest accrued during the related Accrual Period at the
then-applicable Note Rate on the related Note Principal Balance thereof immediately prior to such Payment Date; provided, however, that for any class of Subordinate Notes, such amount shall be reduced by the amount, if any, specified in
clause (a) of the definition of Deferred Interest for such Class for such Payment Date. The Accrued Note Interest on the Notes shall be calculated on the basis of a 360-day year and the actual number of days in the related Accrual Period;
provided, however, that Accrued Note Interest on the Class N Notes for any Accrual Period after the first Accrual Period shall be calculated on the basis of a 360-day year comprised of twelve 30-day months. 
  
 Administration Agreement: The Administration Agreement, dated as of
October 26, 2005, among the Issuer, the Depositor, the Owner Trustee and the Securities Administrator, as administrator. 
  
 Advance: A Monthly Advance or a Servicing Advance. 
  
 Affiliate: With respect to any Person, any other Person controlling, controlled by or under common control with such Person. For purposes of this
definition, “control” means the power to direct the management and policies of a Person, directly or indirectly, whether through ownership of voting securities, by contract or otherwise and “controlling” and
“controlled” shall have meanings correlative to the foregoing. 

 Agreements: The Sale and Servicing Agreement, the Servicing Agreement, the Subservicing Agreement,
the Indenture, the Trust Agreement, the Administration Agreement, the Mortgage Loan Purchase Agreement and the Custodial Agreement. 
  
 Applicable Credit Rating: For any long-term deposit or security, a credit rating of AAA in the case of S&P, AAA in the case of Fitch, or Aaa in
the case of Moody’s. For any short-term deposit or security, a rating of A-l+ in the case of S&P, F1+ in the case of Fitch, or P-1 in the case of Moody’s. 
  
 Appraised Value: The appraised value of the related mortgaged property at the time of origination of such Mortgage
Loan. 
  
 Assignment of Mortgage: An assignment of
Mortgage, notice of transfer or equivalent instrument, in recordable form, which is sufficient under the laws of the jurisdiction wherein the related Mortgaged Property is located to reflect of record the sale of the Mortgage, which assignment,
notice of transfer or equivalent instrument may be in the form of one or more blanket assignments covering Mortgages secured by Mortgaged Properties located in the same county, if permitted by law. 
  
 Authorized Newspaper: A newspaper of general circulation in the
Borough of Manhattan, The City of New York, printed in the English language and customarily published on each Business Day, whether or not published on Saturdays, Sundays or holidays. 
  
 Authorized Officer: With respect to the Issuer, any officer of the Owner Trustee or the Depositor who is authorized
to act for the Owner Trustee or the Depositor in matters relating to the Issuer and who is identified on the list of Authorized Officers delivered by the Owner Trustee and the Depositor to the Indenture Trustee and Securities Administrator on the
Closing Date (as such list may be modified or supplemented from time to time thereafter). 
  
 Available Funds Rate: With respect to any Payment Date, a per-annum rate equal to the product of (a) the quotient of (i) 360 divided by (ii) the actual number of days in the Accrual Period,
multiplied by (b) the quotient of (i) (A) the Interest Funds for such Payment Date, minus (B) any amounts paid by the Trust pursuant to the Swap Agreement on such Payment Date (other than Swap Termination Payments triggered by a
Swap Provider Trigger Event), divided by (ii) the aggregate Note Balance as of the first day of the related Accrual Period. 
  
 Average Loss Severity Percentage: With respect to any Payment Date, the percentage equivalent of a fraction, the numerator of which is the sum of
the Loss Severity Percentages for each Mortgage Loan which had a Realized Loss and the denominator of which is the number of Mortgage Loans which had Realized Losses. 
  
 Bankruptcy Code: The United States Bankruptcy Code, as amended as codified in 11 U.S.C. §§ 101-1330.

  
 Bankruptcy Loss: With respect to any Mortgage Loan, any
Deficient Valuation or Debt Service Reduction related to such Mortgage Loan as reported by the Servicer to the Master Servicer. 
  

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 Basic Documents: The Trust Agreement, the Certificate of Trust, the Indenture, the Sale and
Servicing Agreement, the Administration Agreement, the Servicing Agreement, the Subservicing Agreement, the Mortgage Loan Purchase Agreement, the Swap Agreement, the Custodial Agreement and the other documents and certificates delivered in
connection with any of the above. 
  
 Basic Principal Payment
Amount: With respect to any Payment Date, the excess, if any, of (a) the Principal Funds for such Payment Date over (b) the Overcollateralization Release Amount. 
  
 Basis Risk Shortfall: With respect to any Class of Notes, on each Payment Date where clause (c) of the
definition of “Note Rate” is less than clauses (a) or (b) of the definition of “Note Rate,” the excess, if any, of (x) the aggregate Accrued Note Interest thereon for such Payment Date calculated pursuant to the
lesser of clauses (a) or (b) of the definition of Note Rate over (y) Accrued Note Interest on such Class, computed at the related Available Funds Rate. 
  
 Basis Risk Shortfall Carry-Forward Amount: With respect to each Class of Notes and any Payment Date, as determined
separately for each such Class of Notes, an amount equal to the aggregate amount of Basis Risk Shortfall for such Notes on such Payment Date, plus any unpaid Basis Risk Shortfall for such Class of Notes from prior Payment Dates, plus interest
thereon at the related Note Rate (without regard to the Available Funds Rate) for such Payment Date, to the extent previously unreimbursed by the Net Monthly Excess Cashflow or from payments received under the Corridor Agreement. 
  
 Beneficial Owner: With respect to any Note, the Person who is the
beneficial owner of such Note as reflected on the books of the Depository or on the books of a Person maintaining an account with such Depository (directly as a Depository Participant or indirectly through a Depository Participant, in accordance
with the rules of such Depository). 
  
 Book-Entry Notes:
Each Class of Notes for so long as they are issued, maintained and transferred at DTC. 
  
 Business Day: Any day other than (a) a Saturday or a Sunday, or (b) a day on which the New York Stock Exchange or Federal Reserve is closed or on which banking institutions in the jurisdiction in
which the Indenture Trustee, the Master Servicer, the Servicer, the Subservicer or the Securities Administrator is located are authorized or obligated by law or executive order to be closed. 
  
 Certificate Distribution Account: The account or accounts created and
maintained pursuant to Section 3.09(c) of the Trust Agreement. The Certificate Distribution Account shall be an Eligible Account. 
  
 Certificate Paying Agent: The certificate paying agent appointed pursuant to Section 3.09 of the Trust Agreement, which shall initially be the
Securities Administrator. 
  
 Certificate Percentage
Interest: With respect to each Certificate, the Certificate Percentage Interest stated on the face thereof. 
  

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 Certificate Register: The register maintained by the Certificate Registrar in which the
Certificate Registrar shall provide for the registration of Certificates and of transfers and exchanges of Certificates. 
  
 Certificate Registrar: Initially, the Securities Administrator, in its capacity as Certificate Registrar, or any successor to the Securities
Administrator in such capacity pursuant to the Trust Agreement. 
  
 Certificate of Trust: The Certificate of Trust filed for the Trust pursuant to Section 3810(a) of the Statutory Trust Statute. 
  
 Certificates or Owner Trust Certificates: The People’s Choice Home Loan Securities Trust Series 2005-4, Owner Trust Certificates,
Series 2005-4, evidencing the beneficial ownership interest in the Trust and executed by the Owner Trustee in substantially the form set forth in Exhibit A to the Trust Agreement. 
  
 Certificateholder or Holder: The Person in whose name a Certificate is registered in the Certificate Register.
Owners of Certificates that have been pledged in good faith may be regarded as Holders if the pledgee establishes to the satisfaction of the Securities Administrator or the Owner Trustee, as the case may be, the pledgee’s right so to act with
respect to such Certificates and that the pledgee is not the Issuer, any other obligor upon the Certificates or any Affiliate of any of the foregoing Persons. 
  

Class: Any of the Class 1A1, Class 1A2, Class 1A3, Class 2A1, Class M1, Class M2, Class M3, Class M4, Class M5, Class M6, Class M7, Class M8,
Class M9, Class M10 or Class M11 Notes. 
  
 Class 1A Notes:
The Class 1A1, Class 1A2 and Class 1A3 Notes. 
  
 Class 2A
Notes: The Class 2A1 Notes. 
  
 Class A Notes: Any
of the Class 1A1, Class 1A2, Class 1A3 and Class 2A1 Notes in the form attached as Exhibit A-1 to the Indenture. 
  
 Class A Principal Allocation Fraction: For any Payment Date and each Class of Class A Notes, a fraction, (x) the numerator of which
is the Principal Funds with respect to the Mortgage Loans in the related Loan Group to be distributed on that Payment Date, and (y) the denominator of which is the Principal Funds for all of the Mortgage Loans to be distributed on that Payment
Date. 
  
 Class M Notes: Any of the Class M1, Class M2,
Class M3, Class M4, Class M5, Class M6, Class M7, Class M8, Class M9, Class M10 and Class M11 Notes in the form attached as Exhibit A-2 to the Indenture. 
  
 Class M1 Principal Payment Amount: For any applicable Payment Date on or after the Stepdown Date as long as a Trigger Event has not occurred with
respect to such Payment Date, an amount equal to the excess (if any) of (a) the sum of (i) the aggregate Note Principal Balance of the Class 1A1, Class 1A2, Class 1A3 and Class 2A1 (after taking into 

  

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account the distribution of Senior Principal Payment Amount on such Payment Date) and (ii) the Note Principal Balance of the Class M1 Notes immediately
prior to such Payment Date over (b) the lesser of (i) the aggregate Stated Principal Balance of the Mortgage Loans in respect of such Payment Date multiplied by 62.00% and (ii) the amount, if any, by which (x) the aggregate
Stated Principal Balance of the Mortgage Loans in respect of such Payment Date exceeds (y) the Overcollateralization Floor. 
  
 Class M2 Principal Payment Amount: For any applicable Payment Date on or after the Stepdown Date as long as a Trigger Event has not occurred with
respect to such Payment Date, an amount equal to the excess (if any) of (a) the sum of (i) the aggregate Note Principal Balance of the Class 1A1, Class 1A2, Class 1A3, Class 2A1 and Class M1 Notes (after taking into account the
distribution of Senior Principal Payment Amount and the Class M1 Principal Payment Amount on such Payment Date) and (ii) the Note Principal Balance of the Class M2 Notes immediately prior to such Payment Date over (b) the lesser of
(i) the aggregate Stated Principal Balance of the Mortgage Loans in respect of such Payment Date multiplied by 69.10% and (ii) the amount, if any, by which (x) the aggregate Stated Principal Balance of the Mortgage Loans in respect of
such Payment Date exceeds (y) the Overcollateralization Floor. 
  
 Class M3 Principal Payment Amount: For any applicable Payment Date on or after the Stepdown Date as long as a Trigger Event has not occurred with respect to such Payment Date, an amount equal to the excess (if any) of (a) the
sum of (i) the aggregate Note Principal Balance of the Class 1A1, Class 1A2, Class 1A3, Class 2A1, Class M1 and Class M2 Notes (after taking into account the distribution of Senior Principal Payment Amount and the Class M1 and Class M2
Principal Payment Amounts on such Payment Date) and (ii) the Note Principal Balance of the Class M3 Notes immediately prior to such Payment Date over (b) the lesser of (i) the aggregate Stated Principal Balance of the Mortgage Loans
in respect of such Payment Date multiplied by 73.70% and (ii) the amount, if any, by which (x) the aggregate Stated Principal Balance of the Mortgage Loans in respect of such Payment Date exceeds (y) the Overcollateralization Floor.

  
 Class M4 Principal Payment Amount: For any applicable
Payment Date on or after the Stepdown Date as long as a Trigger Event has not occurred with respect to such Payment Date, an amount equal to the excess (if any) of (a) the sum of (i) the aggregate Note Principal Balance of the Class 1A1,
Class 1A2, Class 1A3, Class 2A1, Class M1, Class M2 and Class M3 Notes (after taking into account the distribution of Senior Principal Payment Amount and the Class M1, Class M2 and Class M3 Principal Payment Amounts on such Payment Date) and
(ii) the Note Principal Balance of the Class M4 Notes immediately prior to such Payment Date over (b) the lesser of (i) the aggregate Stated Principal Balance of the Mortgage Loans in respect of such Payment Date multiplied by 77.20%
and (ii) the amount, if any, by which (x) the aggregate Stated Principal Balance of the Mortgage Loans in respect of such Payment Date exceeds (y) the Overcollateralization Floor. 
  
 Class M5 Principal Payment Amount: For any applicable Payment Date on
or after the Stepdown Date as long as a Trigger Event has not occurred with respect to such Payment Date, an amount equal to the excess (if any) of (a) the sum of (i) the aggregate Note Principal Balance of the Class 1A1, Class 1A2, Class
1A3, Class 2A1, Class M1, Class M2, Class M3 and Class M4 Notes (after taking into account the distribution of Senior Principal 

  

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Payment Amount and the Class M1, Class M2, Class M3 and Class M4 Principal Payment Amounts on such Payment Date) and (ii) the Note Principal Balance of
the Class M5 Notes immediately prior to such Payment Date over (b) the lesser of (i) the aggregate Stated Principal Balance of the Mortgage Loans in respect of such Payment Date multiplied by 80.70% and (ii) the amount, if any, by
which (x) the aggregate Stated Principal Balance of the Mortgage Loans in respect of such Payment Date exceeds (y) the Overcollateralization Floor. 
  
 Class M6 Principal Payment Amount: For any applicable Payment Date on or after the Stepdown Date as long as a Trigger Event has not occurred with
respect to such Payment Date, an amount equal to the excess (if any) of (a) the sum of (i) the aggregate Note Principal Balance of the Class 1A1, Class 1A2, Class 1A3, Class 2A1, Class M1, Class M2, Class M3, Class M4 and Class M5 (after
taking into account the distribution of the Senior Principal Payment Amount and the Class M1, Class M2, Class M3, Class M4 and Class M5 Principal Payment Amounts on such Payment Date) and (ii) the Note Principal Balance of the Class M6 Notes
immediately prior to such Payment Date over (b) the lesser of (i) the aggregate Stated Principal Balance of the Mortgage Loans in respect of such Payment Date multiplied by approximately 83.60% and (ii) the amount, if any, by which
(x) the aggregate Stated Principal Balance of the Mortgage Loans in respect of such Payment Date exceeds (y) the Overcollateralization Floor. 
  
 Class M7 Principal Payment Amount: For any applicable Payment Date on or after the Stepdown Date as long as a Trigger Event has not occurred with
respect to such Payment Date, an amount equal to the excess (if any) of (a) the sum of (i) the aggregate Note Principal Balance of the Class 1A1, Class 1A2, Class 1A3, Class 2A1, Class M1, Class M2, Class M3, Class M4, Class M5 and Class
M6 Notes (after taking into account the distribution of the Senior Principal Payment Amount and the Class M1, Class M2, Class M3, Class M4, Class M5 and Class M6 Principal Payment Amounts on such Payment Date) and (ii) the Note Principal
Balance of the Class M7 Notes immediately prior to such Payment Date over (b) the lesser of (i) the aggregate Stated Principal Balance of the Mortgage Loans in respect of such Payment Date multiplied by approximately 87.00% and
(ii) the amount, if any, by which (x) the aggregate Stated Principal Balance of the Mortgage Loans in respect of such Payment Date exceeds (y) the Overcollateralization Floor. 
  
 Class M8 Principal Payment Amount: For any applicable Payment Date on
or after the Stepdown Date as long as a Trigger Event has not occurred with respect to such Payment Date, an amount equal to the excess (if any) of (a) the sum of (i) the aggregate Note Principal Balance of the Class 1A1, Class 1A2, Class
1A3, Class 2A1, Class M1, Class M2, Class M3, Class M4, Class M5, Class M6 and Class M7 Notes (after taking into account the distribution of the Senior Principal Payment Amount and the Class M1, Class M2, Class M3, Class M4, Class M5, Class M6 and
Class M7 Principal Payment Amounts on such Payment Date) and (ii) the Note Principal Balance of the Class M8 Notes immediately prior to such Payment Date over (b) the lesser of (i) the aggregate Stated Principal Balance of the
Mortgage Loans in respect of such Payment Date multiplied by approximately 89.40% and (ii) the amount, if any, by which (x) the aggregate Stated Principal Balance of the Mortgage Loans in respect of such Payment Date exceeds (y) the
Overcollateralization Floor. 
  

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 Class M9 Principal Payment Amount: For any applicable Payment Date on or after the Stepdown Date
as long as a Trigger Event has not occurred with respect to such Payment Date, an amount equal to the excess (if any) of (a) the sum of (i) the aggregate Note Principal Balance of the Class 1A1, Class 1A2, Class 1A3, Class 2A1, Class M1,
Class M2, Class M3, Class M4, Class M5, Class M6, Class M7 and Class M8 Notes (after taking into account the distribution of the Senior Principal Payment Amount and the Class M1, Class M2, Class M3, Class M4, Class M5, Class M6, Class M7 and Class
M8 Principal Payment Amounts on such Payment Date) and (ii) the Note Principal Balance of the Class M9 Notes immediately prior to such Payment Date over (b) the lesser of (i) the aggregate Stated Principal Balance of the Mortgage
Loans in respect of such Payment Date approximately 91.90% and (ii) the amount, if any, by which (x) the aggregate Stated Principal Balance of the Mortgage Loans in respect of such Payment Date exceeds (y) the Overcollateralization
Floor. 
  
 Class M10 Principal Payment Amount: For any
applicable Payment Date on or after the Stepdown Date as long as a Trigger Event has not occurred with respect to such Payment Date, an amount equal to the excess (if any) of (a) the sum of (i) the aggregate Note Principal Balance of the
Class 1A1, Class 1A2, Class 1A3, Class 2A1, Class M1, Class M2, Class M3, Class M4, Class M5, Class M6, Class M7, Class M8 and Class M9 Notes (after taking into account the distribution of the Senior Principal Payment Amount and the Class M1, Class
M2, Class M3, Class M4, Class M5, Class M6, Class M7, Class M8 and Class M9 Principal Payment Amounts on such Payment Date) and (ii) the Note Principal Balance of the Class M10 Notes immediately prior to such Payment Date over (b) the
lesser of (i) the aggregate Stated Principal Balance of the Mortgage Loans in respect of such Payment Date multiplied by approximately 93.80% and (ii) the amount, if any, by which (x) the aggregate Stated Principal Balance of the
Mortgage Loans in respect of such Payment Date exceeds (y) the Overcollateralization Floor. 
  
 Class M11 Principal Payment Amount: For any applicable Payment Date on or after the Stepdown Date as long as a Trigger Event has not occurred with
respect to such Payment Date, an amount equal to the excess (if any) of (a) the sum of (i) the aggregate Note Principal Balance of the Class 1A1, Class 1A2, Class 1A3, Class 2A1, Class M1, Class M2, Class M3, Class M4, Class M5, Class M6,
Class M7, Class M8, Class M9 and Class M10 Notes (after taking into account the distribution of the Senior Principal Payment Amount and the Class M1, Class M2, Class M3, Class M4, Class M5, .Class M6, Class M7, Class M8, Class M9 and Class M10 Notes
(after taking into account the distribution of the Senior Principal Payment Amount and the Class M1, Class M2, Class M3, Class M4, Class M5, Class M6, Class M7, Class M8, Class M9 and Class M10 Principal Payment Amounts on such Payment Date) and
(ii) the Note Principal Balance of the Class M11 Notes immediately prior to such Payment Date over (b) the lesser of (i) the aggregate Stated Principal Balance of the Mortgage Loans in respect of such Payment Date multiplied by
approximately 93.80% and (ii) the amount, if any, by which (x) the aggregate Stated Principal Balance of the Mortgage Loans in respect of such Payment Date exceeds (y) the Overcollateralization Floor. 
  
 Class N Notes: The Class N Notes. 
  
 Class N Interest Payment Amount: With respect to any Payment Date,
(i) Accrued Note Interest on the Class N Notes for the related Accrual Period and (ii) any such 

  

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previously accrued and unpaid interest at the Note Rate for the Class N Notes (and any such interest accrued thereon at the Note Rate for the Class N Notes).

  
 Class N Principal Payment Amount: For any Payment Date
with respect to the Class N Notes, the lesser of (a) (1) the sum of (A) the amount of Prepayment Charges collected during the related Prepayment Period plus (B) the amount of Net Monthly Excess Cashflow remaining on any Payment
Date after payment of all amounts due pursuant to Section 3.05(e) (i) through (vii) of the Indenture, minus (2) the Class N Interest Payment Amount on the Class N Notes for such Payment Date; and (b) the Note Principal
Balance of the Class N Notes. 
  
 Closing Date:
October 26, 2005. 
  
 Code: The Internal Revenue Code
of 1986, as amended. 
  
 Collateral: The meaning specified
in the Granting Clause of the Indenture. 
  
 Commission:
The Securities and Exchange Commission. 
  
 Company:
People’s Choice Funding, Inc. 
  
 Compensating
Interest: With respect to any Payment Date, any payments made by the Master Servicer, the Servicer or the Subservicer from its own funds to cover Prepayment Interest Shortfalls, which shall be required to be paid in accordance with the Servicing
Agreement or the Sale and Servicing Agreement in an amount equal to the lesser of (a) the amount, if any, by which the aggregate Prepayment Interest Shortfalls in respect of such Payment Date exceed any aggregate Prepayment Interest Excess in
respect of such Payment Date and (B) the Servicing Fee received with respect to the related Due Period. 
  
 Compensating Interest Payment: As defined in Section 3.23 of the Sale and Servicing Agreement. 
  
 Corporate Trust Office: With respect to the Indenture Trustee, the
principal corporate trust office of the Indenture Trustee at which at any particular time its engagement under the Indenture shall be administered, which office at the date of the execution of this instrument is located at HSBC Bank USA, National
Association, 452 Fifth Avenue, New York, New York 10018, Attention: Corporate Trust. With respect to the Owner Trustee, the principal corporate trust office of the Owner Trustee at which at any particular time its corporate trust business shall be
administered, which office at the date of the execution of this Trust Agreement is located at Wilmington Trust Company, Rodney Square North, 1100 North Market Street, Wilmington, Delaware, 19890, Attention: People’s Choice Home Loan Securities
Trust Series 2005-4. The Corporate Trust Office of the Note Registrar, Certificate Registrar and Securities Administrator for purposes of presentment and surrender of the Notes and the Certificates for the final payment or distribution thereon and
for transfer is located at Sixth Street and Marquette Avenue, Minneapolis, Minnesota, 55479, Attention: People’s Choice Home Loan Securities Trust Series 2005-4, and for all other purposes is located at P.O. Box 98, Columbia, Maryland, 21046
(or, for overnight deliveries, 9062 Old Annapolis Road, Columbia, Maryland, 21045), Attention: People’s Choice Home Loan Securities Trust Series 2005-4, or any other address that 

  

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the Securities Administrator may designate from time to time by notice to the Noteholders and the Certificateholders. 
  
 Corridor Agreement: The interest rate corridor agreement between the
Indenture Trustee and the Corridor Counterparty for the benefit of the Offered Notes. 
  
 Corridor Counterparty: Swiss Re Financial Products Corporation. 
  
 Custodial Account: As defined in the Servicing Agreement. 
  

Custodial Agreement: The custodial agreement dated as of October 26, 2005, among the Issuer, the Indenture Trustee, the Depositor, the
Master Servicer, the Servicer, the Subservicer, the Securities Administrator and the Custodian, relating to the People’s Choice Home Loan Securities Trust Series 2005-4, Mortgage-Backed Notes, Series 2005-4. 
  
 Custodian: Wells Fargo Bank, National Association and its successors
and assigns. 
  
 Cut-off Date: With respect to the Mortgage
Loans, October 1, 2005. 
  
 Cut-off Date Balance:
$1,124,956,150.91. 
  
 Cut-off Date Principal Balance: With
respect to any Mortgage Loan, the unpaid principal balance thereof as of the Cut-off Date after applying the principal portion of Monthly Payments due on or before such date, whether or not received, and without regard to any payments due after such
date. 
  
 Debt Service Reduction: Any reduction of the
Scheduled Payments which a Mortgagor is obligated to pay with respect to a Mortgage Loan as a result of any proceeding under the Bankruptcy Code or any other similar state law or other proceeding. 
  
 Default: Any occurrence which is or with notice or the lapse of time
or both would become an Event of Default. 
  
 Deferred
Interest: For each Class of Subordinate Notes and any Payment Date, the sum of (a) the aggregate amount of interest accrued at the applicable Note Rate without regard to the Available Funds Rate during the related Accrual Period on the
portion of the Principal Deficiency Amount allocated to that Class, (b) any amounts described in clause (a) for such Class for prior Payment Dates that remain unpaid, and (c) interest accrued for the Accrual Period related to such
Payment Date on the amount in clause (b) at the Note Rate applicable to such Class without regard to the Available Funds Rate. 
  
 Deficient Valuation: With respect to any Mortgage Loan, a valuation of the Mortgaged Property by a court of competent jurisdiction in an amount
less than the then outstanding indebtedness under the Mortgage Loan, which valuation results from a proceeding initiated under the Bankruptcy Code or any other similar state law or other proceeding. 
  
 Definitive Notes: The meaning specified in Section 4.06 of the
Indenture. 
  

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 Deleted Mortgage Loan: A Mortgage Loan replaced or to be replaced with a Substitute Mortgage Loan.

  
 Delinquency Rate: For any month, the fraction,
expressed as a percentage, the numerator of which is the aggregate outstanding principal balance of all Mortgage Loans 60 or more days delinquent measured pursuant to the OTS method (including all Mortgage Loans in foreclosure, Mortgage Loans
subject to bankruptcy proceedings and REO properties) as of the close of business on the last day of such month, and the denominator of which is the aggregate Stated Principal Balance of the Mortgage Loans as of the close of business on the last day
of such month. 
  
 Depositor: People’s Choice Home
Loan Securities Corp., a Delaware corporation, or its successor in interest. 
  
 Depository: The Depository Trust Company, the nominee of which is Cede & Co., or any successor thereto. 
  
 Depository Participant: A Person for whom, from time to time, the Depository effects book-entry transfers and pledges of securities deposited with
the Depository. 
  
 Designated Depository Institution: A
depository institution (commercial bank, federal savings bank, mutual savings bank or savings and loan association) or trust company (which may include the Indenture Trustee), the deposits of which are fully insured by the FDIC to the extent
provided by law. 
  
 Determination Date: With respect to
any Payment Date, is on the 15th day of the month in which such Payment Date occurs or, if such day is not a
Business Day, on the immediately preceding Business Day. 
  
 DTC: The Depository Trust Company, including its successors and assigns. 
  
 Due Date: With respect to each Mortgage Loan, the first day of the month. 
  
 Due Period: With respect to any Payment Date, the period commencing on the second day of the month immediately preceding the month in which such
Payment Date occurs and ending on the first day of the month in which such Payment Date occurs. 
  
 Eligible Account: Any of (a) a segregated account maintained with a federal or state chartered depository institution (i) the short-term
obligations of which are rated A-1 or better by S&P, P-1 by Moody’s and F-1 by Fitch at the time of any deposit therein or (ii) insured by the FDIC (to the limits established by such corporation), the uninsured deposits in which
account are otherwise secured such that, as evidenced by an Opinion of Counsel (obtained by the Person requesting that the account be held pursuant to this clause (a)) delivered to the Securities Administrator prior to the establishment of such
account, the Noteholders will have a claim with respect to the funds in such account and a perfected first priority security interest against any collateral (which shall be limited to Permitted Investments, each of which shall mature not later than
the Business Day immediately preceding the Payment Date next following the date of investment in such collateral or the Payment Date if such Permitted Investment is an obligation 

  

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of the institution that maintains the Payment Account) securing such funds that is superior to claims of any other depositors or general creditors of the
depository institution with which such account is maintained, (b) a segregated trust account or accounts maintained with a federal or state chartered depository institution or trust company with trust powers acting in its fiduciary capacity or
(c) a segregated account or accounts of a depository institution acceptable to the Rating Agencies (as evidenced in a written notice from the Rating Agencies that use of any such account as the Payment Account will not have an adverse effect on
the then-current ratings assigned to the Classes of Notes then rated by such Rating Agency). Eligible Accounts may bear interest. 
  
 ERISA: The Employee Retirement Income Security Act of 1974, as amended. 
  
 Event of Default: With respect to the Indenture, any one of the following events (whatever the reason for such Event
of Default and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body): 
  
 (i) a failure by the Issuer to pay (a) (1) Accrued
Note Interest on any Class of Offered Notes on any Payment Date, which failure is not cured within three days or (2) the Class N Interest Payment Amount in respect of the Class N Notes if such default continues for six consecutive Payment
Dates, or (b) the Principal Payment Amount with respect to a Payment Date on such Payment Date, which failure is not cured within 3 business days or (c) failure to pay the outstanding Note Principal Balance and Class N Interest Payment
Amount due in respect of the Class N Notes when the same becomes due and payable on the applicable Maturity Date; or 
  
 (ii) the failure by the Issuer on the Final Scheduled Payment Date to pay all Accrued Note Interest and to reduce the Note Principal
Balance of any Class of Notes to zero; or 
  
 (iii) there occurs a default in the observance or performance of any covenant or agreement of the Issuer made in the Indenture, or any representation or warranty of the Issuer made in the Indenture or in any certificate or other writing
delivered pursuant hereto or in connection herewith proving to have been incorrect in any material respect as of the time when the same shall have been made, and such default shall continue or not be cured, or the circumstance or condition in
respect of which such representation or warranty was incorrect shall not have been eliminated or otherwise cured, for a period of 60 days after there shall have been given, by registered or certified mail, to the Issuer by the Indenture Trustee or
to the Issuer and the Indenture Trustee by the Holders of at least 25% of the aggregate Note Principal Balance of the Outstanding Notes, a written notice specifying such default or incorrect representation or warranty and requiring it to be remedied
and stating that such notice is a notice of default hereunder; or 
  

 -11- 

 (iv) there occurs the filing of a decree or order for relief by a court having
jurisdiction in the premises in respect of the Issuer or any substantial part of the Trust Estate in an involuntary case under any applicable federal or state bankruptcy, insolvency or other similar law now or hereafter in effect, or appointing a
receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official of the Issuer or for any substantial part of the Trust Estate, or ordering the winding-up or liquidation of the Issuer’s affairs, and such decree or order
shall remain unstayed and in effect for a period of 60 consecutive days; or 
  
 (v) there occurs the commencement by the Issuer of a voluntary case under any applicable federal or state bankruptcy, insolvency or other similar law now or hereafter in effect, or the consent by the Issuer to the
entry of an order for relief in an involuntary case under any such law, or the consent by the Issuer to the appointment or taking possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official of the Issuer or
for any substantial part of the assets of the Trust Estate, or the making by the Issuer of any general assignment for the benefit of creditors, or the failure by the Issuer generally to pay its debts as such debts become due, or the taking of any
action by the Issuer in furtherance of any of the foregoing. 
  
 Excess Liquidation Proceeds: To the extent that such amount is not required by law to be paid to the related Mortgagor, the amount, if any, by which Liquidation Proceeds with respect to a Liquidated Mortgage Loan exceed the sum of
(a) the Outstanding Principal Balance of such Mortgage Loan and accrued but unpaid interest at the related Mortgage Rate through the last day of the month in which the related Liquidation Date occurs, (b) related Liquidation Expenses
(including Liquidation Expenses which are payable therefrom to the Subservicer, the Servicer or the Master Servicer in accordance with the Servicing Agreement or the Sale and Servicing Agreement) and (c) unreimbursed advances by the
Subservicer, the Servicer or the Master Servicer and Monthly Advances. 
  
 Exchange Act: The Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder. 
  
 Expenses: The meaning specified in Section 7.02 of the Trust Agreement. 
  
 Extraordinary Expense: Any amounts payable or reimbursable to the Indenture Trustee pursuant to Section 6.07 of
the Indenture, including indemnifications thereunder, and any other costs, expenses and liabilities that are required to be borne by the Trust Estate in accordance with applicable law or the terms of the Indenture (including, without limitation, the
cost of various opinions of and advice from counsel required to be obtained in connection with the Indenture Trustee’s performance of its duties under the Indenture). 
  
 The Securities Administrator may make withdrawals from the Payment Account to pay the Indenture Trustee or reimburse the
Indenture Trustee the amount of any Extraordinary Expenses at any time, up to a limit of $150,000 of Extraordinary Expenses per calendar year; provided, however, that the Indenture Trustee shall not have any obligation to incur additional
Extraordinary Expenses in excess of such annual limit unless it has received security or 

  

 -12- 

 
indemnity reasonably satisfactory to it for such additional Extraordinary Expenses. The Indenture Trustee shall be held harmless and shall not be liable for
any consequences to the Noteholders resulting from any failure of the Indenture Trustee to incur any Extraordinary Expenses for which it is not assured reimbursement. 
  
 Extra Principal Payment Amount: With respect to any Payment Date, the lesser of (a) the Net Monthly Excess
Cashflow for such Payment Date and (b) the excess, if any, of (i) the Overcollateralization Target Amount over (ii) the Overcollateralized Amount on such Payment Date (after taking into account payments to the Notes of the Basic
Principal Payment Amount on such Payment Date). 
  
 Fannie
Mae: Fannie Mae (formerly, the Federal National Mortgage Association), or any successor thereto. 
  
 FDIC: The Federal Deposit Insurance Corporation or any successor thereto. 
  
 Fee Agreement: The Fee Agreement dated as of October 26, 2005, between the Owner Trustee and the Seller.

  
 Final Certification: The final certification delivered
by the Custodian pursuant to Section 2.3(c) of the Custodial Agreement in the form attached thereto as Exhibit Three. 
  
 Final Scheduled Payment Date: With respect to each Class of Offered Notes, the Payment Date in December 2035. 
  
 FIRREA: The Financial Institutions Reform, Recovery, and Enforcement
Act of 1989, as amended from time to time. 
  
 Fitch:
Fitch, Inc. 
  
 Fixed Swap Payment: With respect to each
Payment Date, a fixed amount equal to the product of (a) a fixed rate equal to 4.7625% per annum, (b) the notional amount for that Payment Date, as provided in the schedule of notional balances attached as Exhibit B to the Indenture
and (c) a fraction, the numerator of which is 30 and the denominator of which is 360, provided that the numerator is 27 for the first Payment Date. 
  
 Floating Swap Payment: With respect to each Payment Date, an amount equal to the product of (a) one-month LIBOR as determined pursuant to the
interest rate Swap Agreement, (b) the notional amount for that Payment Date, as provided in the schedule of notional balances attached as Exhibit B to the Indenture and (c) a fraction, the numerator of which is equal to the number of days
in the related calculation period as provided in the Swap Agreement and the denominator of which is 360 provided that the numerator is 27 for the first Payment Date. 
  
 Freddie Mac: Freddie Mac (formerly, the Federal Home Loan Mortgage Corporation), or any successor thereto.

  

 -13- 

 Grant: Pledge, bargain, sell, warrant, alienate, remise, release, convey, assign, transfer,
create, and grant a lien upon and a security interest in and right of set-off against, deposit, set over and confirm pursuant to the Indenture. A Grant of the Collateral or of any other agreement or instrument shall include all rights, powers and
options (but none of the obligations) of the granting party thereunder, including the immediate and continuing right to claim for, collect, receive and give receipt for principal and interest payments in respect of such collateral or other agreement
or instrument and all other moneys payable thereunder, to give and receive notices and other communications, to make waivers or other agreements, to exercise all rights and options, to bring proceedings in the name of the granting party or
otherwise, and generally to do and receive anything that the granting party is or may be entitled to do or receive thereunder or with respect thereto. 
  
 Gross Margin: As to each Mortgage Loan, the fixed percentage set forth in the related Mortgage Note and indicated on the Mortgage Loan Schedule
which percentage is added to the related Index on each Interest Adjustment Date to determine (subject to rounding, the minimum and maximum Mortgage Rate and the Periodic Rate Cap) the Mortgage Rate until the next Interest Adjustment Date.

  
 Group 2 Sequential Trigger Event: A Group 2 Sequential
Trigger Event is in effect with respect of any Payment Date prior to the Stepdown Date, if cumulative Realized Losses for such Payment Date as a percentage of the aggregate Stated Principal Balance of mortgage loans as of the Cut-off Date are
greater than 1.65%, and on or after the Stepdown Date if a Trigger Event is in effect. 
  
 Indemnified Party: The meaning specified in Section 7.02 of the Trust Agreement. 
  
 Indenture: The indenture dated as of October 26, 2005, among the Issuer, the Indenture Trustee and the Securities Administrator, relating to
the People’s Choice Home Loan Securities Trust Series 2005-4, Mortgage-Backed Notes, Series 2005-4. 
  
 Indenture Trustee: HSBC Bank USA, National Association, and its successors and assigns or any successor indenture trustee appointed pursuant to the
terms of the Indenture. 
  
 Independent: When used with
respect to any specified Person, the Person (a) is in fact independent of the Issuer, any other obligor on the Notes, the Seller, the Master Servicer, the Servicer, the Subservicer, the Depositor and any Affiliate of any of the foregoing
Persons, (b) does not have any direct financial interest or any material indirect financial interest in the Issuer, any such other obligor, the Seller, the Master Servicer, the Servicer, the Subservicer, the Depositor or any Affiliate of any of
the foregoing Persons and (c) is not connected with the Issuer, any such other obligor, the Seller, the Master Servicer, the Servicer, the Subservicer, the Depositor or any Affiliate of any of the foregoing Persons as an officer, employee,
promoter, underwriter, trustee, partner, director or person performing similar functions. 
  
 Independent Certificate: A certificate or opinion to be delivered to the Indenture Trustee under the circumstances described in, and otherwise complying with, the applicable requirements of Section 10.01
of the Indenture, made by an independent appraiser or other expert 

  

 -14- 

 
appointed by an Issuer Request, and such opinion or certificate shall state that the signer has read the definition of “Independent” in this
Indenture and that the signer is Independent within the meaning thereof. 
  
 Index: The index, if any, specified in a Mortgage Note by reference to which the related Mortgage Rate will be adjusted from time to time. 
  
 Initial Certification: The initial certification delivered by the Custodian pursuant to Section 2.3(a) of the
Custodial Agreement in the form attached thereto as Exhibit One. 
  
 Initial Note Principal Balance: With respect to any Note, the initial Note Principal Balance thereof as set forth in Section 2.02 of the Indenture. 
  
 Insurance Policy: With respect to any Mortgage Loan, any standard hazard insurance policy, flood insurance policy or
title insurance policy. 
  
 Insurance Proceeds: Amounts
paid by the insurer under any Insurance Policy covering any Mortgage Loan or Mortgaged Property other than amounts required to be paid over to the Mortgagor pursuant to law or the related Mortgage Note or Security Instrument and other than amounts
used to repair or restore the Mortgaged Property or to reimburse insured expenses. 
  
 Interest Adjustment Date: With respect to a Mortgage Loan, the date, if any, specified in the related Mortgage Note on which the Mortgage Rate is subject to adjustment. 
  
 Interest Determination Date: With respect to the first Accrual Period,
the second LIBOR Business Day preceding the Closing Date, and with respect to each Accrual Period thereafter, the second LIBOR Business Day preceding the related Payment Date on which such Accrual Period commences. 
  
 Interest Funds: For any Payment Date will equal (a) the sum of
(i) all interest received or advanced by the Securities Administrator in the related Due Period and available in the Payment Account on that Payment Date, (ii) any Net Swap Payments or Swap Termination Payment received by the Securities
Administrator relating to such Payment Date, (iii) all Compensating Interest paid with respect to Mortgage Loans that prepaid during the related Prepayment Period and (iv) the portion of any purchase price or other amount paid with respect
to the Mortgage Loans allocable to interest; net of (b) any amounts, without duplication, paid and reimbursed to the Master Servicer, the Servicer, the Subservicer, the Securities Administrator, the Custodian, the Indenture Trustee and the
Owner Trustee out of funds in the Custodial Account or the Payment Account, other than any unreimbursed Extraordinary Expenses or other expenses, costs and liabilities payable out of Net Monthly Excess Cashflow on that Payment Date. 
  
 Interim Certification: The interim certification delivered by the
Custodian pursuant to Section 2.3(b) of the Custodial Agreement in the form attached thereto as Exhibit Two. 
  
 Investment Company Act: The Investment Company Act of 1940, as amended, and any amendments thereto. 
  

 -15- 

 IRS: The Internal Revenue Service. 
  
 ISDA Master Agreement: 1992 ISDA Master Agreement (Multicurrency — Cross Border). 
  
 Issuer: People’s Choice Home Loan Securities Trust Series 2005-4,
a Delaware statutory trust, or its successor in interest. 
  
 Issuer Request: A written order or request signed in the name of the Issuer by any one of its Authorized Officers and delivered to the Indenture Trustee or Securities Administrator, as applicable. 
  
 LIBOR Business Day: A day on which banks are open for dealing in
foreign currency and exchange in London and New York City. 
  
 Lien: Any mortgage, deed of trust, pledge, conveyance, hypothecation, assignment, participation, deposit arrangement, encumbrance, lien (statutory or other), preference, priority right or interest or other security agreement or
preferential arrangement of any kind or nature whatsoever, including, without limitation, any conditional sale or other title retention agreement, any financing lease having substantially the same economic effect as any of the foregoing and the
filing of any financing statement under the UCC (other than any such financing statement filed for informational purposes only) or comparable law of any jurisdiction to evidence any of the foregoing. 
  
 Liquidated Mortgage Loan: Any defaulted Mortgage Loan as to which the
Subservicer, the Servicer or the Master Servicer has determined that all amounts it expects to recover from or on account of such Mortgage Loan have been recovered. 
  
 Liquidation Date: With respect to any Liquidated Mortgage Loan, the date on which the Master Servicer, the Servicer
or the Subservicer has certified that such Mortgage Loan has become a Liquidated Mortgage Loan. 
  
 Liquidation Expenses: With respect to a Mortgage Loan in liquidation, unreimbursed expenses paid or incurred by or for the account of the Master
Servicer, the Servicer or the Subservicer in connection with the liquidation of such Mortgage Loan and the related Mortgage Property, such expenses including (a) property protection expenses, (b) property sales expenses,
(c) foreclosure and sale costs, including court costs and reasonable attorneys’ fees, and (d) similar expenses reasonably paid or incurred in connection with liquidation. 
  
 Liquidation Proceeds: Amounts received in connection with the liquidation of a defaulted Mortgage Loan, whether
through the sale or assignment of such Mortgage Loan, trustee’s sale, foreclosure sale, Insurance Proceeds, condemnation proceeds or otherwise, other than amounts received following the acquisition of an REO Property pursuant to
Section 4.13 of the Servicing Agreement. 
  
 Loan-to-Value
Ratio: With respect to any Mortgage Loan at any given time, the percentage equivalent of a fraction, (a) the numerator of which is the then outstanding principal 

  

 -16- 

 
balance of the Mortgage Loan plus the outstanding principal balance of any Mortgage Loan senior to the Mortgage Loan and secured by the same Mortgaged
Property, and (b) the denominator of which equals (i) in the case of any Mortgage Loan that is not a refinanced, modified or converted Mortgage Loan, (A) the lesser of (x) the appraised value of the related Mortgaged Property
determined pursuant to an appraisal conducted by a Qualified Appraiser obtained at origination of the Mortgage Loan, if any, and (y) the sales price for the related Mortgaged Property or (B) if the related Mortgaged Property has been
appraised by a Qualified Appraiser subsequent to origination, the value thereof determined pursuant to such subsequent appraisal, or (ii) in the case of a refinanced, modified or converted Mortgage Loan, the lesser of (x) the appraised
value of the related Mortgaged Property determined at origination pursuant to the most recent appraisal conducted by a Qualified Appraiser at the time of origination of the Mortgage Loan or subsequent to origination or (y) the sales price of
the related Mortgaged Property or, if the Mortgage Loan is not a rate-and-term refinance Mortgage Loan and if the related Mortgaged Property was owned for a relatively short period of time prior to refinancing, modification or conversion, the sum of
the sales price of the related Mortgaged Property plus the added value of any improvements. 
  
 Loan Group: One of two subsets of the Mortgage Loans, into one of which each Mortgage Loan shall be allocated, as designated on the Mortgage Loan Schedule, with Loan Group 1 being primarily related to the Class
1A Notes and Loan Group 2 being primarily related to the Class 2A Notes. 
  
 Loss Severity Percentage: With respect to any Payment Date, the percentage equivalent of a fraction, the numerator of which is the amount of Realized Losses incurred on a Mortgage Loan and the denominator of
which is the Stated Principal Balance of such Mortgage Loan in respect of such Payment Date, without giving effect to the reduction of its Stated Principal Balance to zero due to its liquidation. 
  
 Lost Notes: The original Mortgage Notes that have been lost, as
indicated on the Mortgage Loan Schedule. 
  
 Majority
Certificateholder: A Holder of a 50.01% or greater Certificate Percentage Interest of the Certificates. 
  
 Master Servicer: Wells Fargo Bank, National Association, and its successors and assigns. 
  
 Master Servicer Certification: A written certification covering
servicing of the Mortgage Loans by the Servicer and signed by an officer of the Master Servicer that complies with (a) the Sarbanes-Oxley Act of 2002, as amended from time to time, and (b) the February 21, 2003 Statement by the Staff
of the Division of Corporation Finance of the Securities and Exchange Commission Regarding Compliance by Asset-Backed Issuers with Exchange Act Rules 13a-14 and 15d-14, as in effect from time to time; provided that if, after the Closing Date,
(i) the Sarbanes-Oxley Act of 2002 is amended, (ii) the Statement referred to in clause (b) is modified or superceded by any subsequent statement, rule or regulation of the Securities and Exchange Commission or any statement of a
division thereof, or (iii) any future releases, rules and regulations are published by the Securities and Exchange Commission from time to time 

  

 -17- 

 
pursuant to the Sarbanes-Oxley Act of 2002, which in any such case affects the form or substance of the required certification and results in the required
certification being, in the reasonable judgment of the Master Servicer, materially more onerous than the form of the required certification as of the Closing Date, the Master Servicer Certification shall be as agreed to by the Master Servicer, the
Company and the Seller following a negotiation in good faith to determine how to comply with any such new requirements. 
  
 Master Servicer Event of Default: Has the meaning assigned to such term in Section 6.01 of the Sale and Servicing Agreement. 
  
 Master Servicing Compensation: For any Payment Date, any investment
income on funds on deposit in the Payment Account which is payable to the Master Servicer on such Payment Date pursuant to Sections 3.14 and 4.04(d) of the Sale and Servicing Agreement. 
  
 Master Servicing Officer: Any supervisory or management officer of the Master Servicer, involved in, or responsible
for, the administration and master servicing of Mortgage Loans included in the Trust, whose name appears on a list of master servicing officers appearing in an Officer’s Certificate furnished by the Master Servicer to the Indenture Trustee, in
which certificate the Master Servicer certifies that such officers are in supervisory or management roles, as such list may be amended from time to time. 
  
 Maximum Note Rate: With respect to each Class of Notes, (a) for any Payment Date on which the Swap Agreement is in effect, 15.00% per
annum, and (b) for any other Payment Date, 12.85% per annum. 
  
 Material Defect: The meaning specified in Section 2.02(a) of the Sale and Servicing Agreement. 
  
 Maturity Date: For the Class N Notes, December 2035. 
  
 Maximum Lifetime Mortgage Rate: The maximum level to which a Mortgage Rate can adjust in accordance with its terms, regardless of changes in the
applicable Index. 
  
 MERS: Mortgage Electronic
Registration Systems, Inc., a corporation organized and existing under the laws of the State of Delaware, or any successor thereto. 
  
 MERS® System: The system of recording transfers of Mortgages electronically maintained by MERS. 
  

MIN: The Mortgage Identification Number for Mortgage Loans registered with MERS on the MERS® System. 
  
 Minimum Lifetime Mortgage Rate: The minimum level to which a Mortgage Rate can adjust in accordance with its terms,
regardless of changes in the applicable Index. 
  
 MOM
Loan: With respect to any Mortgage Loan, MERS acting as the mortgagee of such Mortgage Loan, solely as nominee for the originator of such Mortgage Loan and its 

  

 -18- 

 
successors and assigns, at the origination thereof, or as nominee for any subsequent assignee of the originator pursuant to an assignment of mortgage to
MERS. 
  
 Monthly Advance: An advance of principal or
interest required to be made by the Servicer (net of the Servicing Fee), or the Subservicer (net of the Subservicing Fee), pursuant to Section 5.03 of the Servicing Agreement. 
  
 Monthly Payment: With respect to any Mortgage Loan (including any REO Property) and any Due Date, the payment of
principal and interest due thereon, or in the case of an Interest Only Mortgage Loan, the payment of (a) interest or (b) principal and interest, if applicable, accordance with the amortization schedule at the time applicable thereto (after
adjustment, if any, for partial Principal Prepayments and for Deficient Valuations occurring prior to such Due Date but before any adjustment to such amortization schedule by reason of any bankruptcy, other than a Deficient Valuation, or similar
proceeding or any moratorium or similar waiver or grace period). 
  
 Moody’s: Moody’s Investors Service, Inc. 
  
 Mortgage: The mortgage, deed of trust or other instrument reflected on the Mortgage Loan Schedule as securing a Mortgage Loan. 
  
 Mortgage File: The file containing the Mortgage Loan Documents pertaining to a particular Mortgage Loan and any additional documents required to be
added to the Mortgage File pursuant to the Sale and Servicing Agreement. 
  
 Mortgage Loan: A mortgage loan transferred and assigned to the Trust pursuant to Section 2.01 or Section 2.04 of the Sale and Servicing Agreement, as identified in the Mortgage Loan Schedule,
including REO Property that formerly secured a Mortgage Loan. 
  
 Mortgage Loan Documents: With respect to each Mortgage Loan, the documents specified in Section 2.01(b)(i)-(vii) of the Sale and Servicing Agreement and any documents required to be added to such documents pursuant to the
Sale and Servicing Agreement or the Mortgage Loan Purchase Agreement. 
  
 Mortgage Loan Purchase Agreement: The Mortgage Loan Purchase Agreement dated as of the Cut-off Date between the Seller and the Depositor, whereby the Mortgage Loans are being sold to the Depositor by the Seller. 
  
 Mortgage Loan Schedule: With respect to any date, the schedule of
Mortgage Loans held by the Issuer on such date. The schedule of Mortgage Loans as of the Cut-off Date is the schedule set forth in Exhibit A to the Sale and Servicing Agreement, which schedule sets forth as to each Mortgage Loan: 
  
 (i) the loan number; 
  
 (ii) the city, state and zip code of the Mortgaged Property; 
  
 (iii) the Mortgage Rate; 
  

 -19- 

 (iv) the Servicing Fee Rate; 
  
 (v) the Net Rate; 
  
 (vi) the original term to maturity; 
  
 (vii) the maturity date; 
  
 (viii) the stated remaining term to maturity; 
  
 (ix) the original principal balance; 
  
 (x) the first Payment Date; 
  
 (xi) the Monthly Payment in effect as of the Cut-off Date; 
  
 (xii) the Cut-off Date Principal Balance; 
  
 (xiii) the Loan-to-Value Ratio at origination; 
  
 (xiv) the paid-through date of the Mortgage Loan; 
  
 (xv) the issuer of any Primary Mortgage Insurance Policy; 
  
 (xvi) the Index and the Gross Margin; 
  
 (xvii) the Maximum Lifetime Mortgage Rate; 
  
 (xviii) the Minimum Lifetime Mortgage Rate; 
  
 (xix) the Interest Adjustment Date frequency and Payment Date frequency; and 
  
 (xx) the number of days delinquent, if any. 
  
 The Mortgage Loan Schedule shall also set forth the total number of Mortgage Loans, the total of each of the amounts
described under (ix) and (xii) above for all of the Mortgage Loans, the weighted average by principal balance of each of the rates described under (iii), (iv) and (v) above for all of the Mortgage Loans and the weighted average
remaining term to maturity by unpaid principal balance as of the Cut-off Date for all of the Mortgage Loans. 
  
 Mortgage Note: The originally executed note or other evidence of the indebtedness of a Mortgagor under the related Mortgage Loan. 
  
 Mortgaged Property: Land and improvements or, to the extent permitted
by the Sale and Servicing Agreement and the Mortgage Loan Purchase Agreement, a residential real property leasehold securing the indebtedness of a Mortgagor under the related Mortgage Loan or, in the case of REO Property, such REO Property.

  

 -20- 

 Mortgage Rate: The annual rate at which interest accrues from time to time on any Mortgage Loan
pursuant to the related Mortgage Note, which rate is initially equal to the “Mortgage Rate” set forth with respect thereto on the Mortgage Loan Schedule. 
  
 Mortgagor: The obligor on a Mortgage Note. 
  
 Net Liquidation Proceeds: Any Liquidation Proceeds net of unreimbursed advances by the Servicer or the Subservicer,
Monthly Advances, expenses incurred by the Servicer or the Subservicer in connection with the liquidation of such Mortgage Loan and the related Mortgaged Property, and any other amounts payable to the Servicer or the Subservicer under the Servicing
Agreement. 
  
 Net Monthly Excess Cashflow: For any Payment
Date, the sum of (a) any Overcollateralization Release Amount and (b) the excess of (i) the Interest Funds for such Payment Date over (ii) the sum of the aggregate Accrued Note Interest for the Notes and, without duplication of
amounts deducted pursuant to the definition of “Interest Funds,” amounts payable to the Servicer, the Master Servicer, the Securities Administrator and the Swap Provider (other than Swap Termination Payments triggered by a Swap Provider
Trigger Event). 
  
 Net Mortgage Rate: With respect to each
Mortgage Loan for any Payment Date, the then applicable Mortgage Rate thereon minus the Servicing Fee Rate, expressed as a per annum percentage of the aggregate Stated Principal Balance of the Mortgage Loans in respect of the immediately preceding
Payment Date. 
  
 Net Swap Payment: With respect to each
Payment Date, a Net Swap Payment will be required to be made (a) by the Trust, to the Swap Provider, to the extent that the Fixed Swap Payment for such Payment Date exceeds the Floating Swap Payment for such Payment Date, or (b) by the
Swap Provider, to the Trust, to the extent that the Floating Swap Payment exceeds the Fixed Swap Payment for such Payment Date. 
  
 Nonrecoverable Advance: Any Servicing Advance or Monthly Advance (a) which was previously made or is proposed to be made by the Master
Servicer, the Indenture Trustee solely as successor Master Servicer, the Servicer or the Subservicer and (b) which, in the good faith judgment of the Master Servicer, the Indenture Trustee as successor Master Servicer, the Servicer or the
Subservicer, as the case may be, will not or, in the case of a proposed advance or Monthly Advance, would not, be ultimately recoverable by the Master Servicer, the Indenture Trustee as successor Master Servicer, the Servicer or the Subservicer from
Liquidation Proceeds, Insurance Proceeds or future payments on the Mortgage Loan for which such advance or Monthly Advance was made or is proposed to be made. 
  

Note: A Class A Note, Class M Note or Class N Note. 
  
 Note Margin: With respect to the Class 1A1, Class 1A2, Class 1A3, Class 2A1, Class M1, Class M2, Class M3, Class M4,
Class M5, Class M6, Class M7, Class M8, Class M9, Class M10 and Class M11 Notes, on any payment date prior to the Step-Up Date, 0.120%, 0.260%, 0.340%, 0.250%, 0.430%, 0.450%, 0.470%, 0.600%, 0.630%, 0.700%, 1.200%, 1.450%, 1.900%, 3.000% and
3.000% per annum, respectively, and on any payment date on and 

  

 -21- 

 
after the Step-Up Date, 0.240%, 0.520%, 0.680%, 0.500%, 0.645%, 0.675%, 0.705%, 0.900%, 0.945%, 1.050%, 1.800%, 2.175%, 2.850%, 4.500% and 4.500% per
annum, respectively. 
  
 Note Owner: The Beneficial Owner
of a Book-Entry Note. 
  
 Note Principal Balance: With
respect to any Note as of any date of determination, the Initial Note Principal Balance thereof reduced by the aggregate of all amounts allocable to principal previously paid with respect to such Note. 
  
 Note Rate: With respect to each Payment Date and each Class of the
Offered Notes, a floating rate equal to the least of (a) One-Month LIBOR plus the related Note Margin, (b) the Maximum Note Rate and (c) the Available Funds Rate with respect to such Payment Date. With respect to each Payment Date and
the Class N Notes, 5.00% per annum. 
  
 Note Register:
The register maintained by the Note Registrar in which the Note Registrar shall provide for the registration of Notes and of transfers and exchanges of Notes. 
  

Note Registrar: The Securities Administrator, in its capacity as Note Registrar, or any successor to the Securities Administrator in such
capacity. 
  
 Noteholder or Holder: The Person in whose
name a Note is registered in the Note Register, except that, any Note registered in the name of the Depositor, the Issuer, the Indenture Trustee, the Seller, the Securities Administrator, the Master Servicer, the Servicer or the Subservicer or any
Affiliate of any of them shall be deemed not to be a holder or holders, nor shall any so owned be considered outstanding, for purposes of giving any request, demand, authorization, direction, notice, consent or waiver under the Indenture or the
Trust Agreement; provided that, in determining whether the Indenture Trustee or Securities Administrator shall be protected in relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Notes that a
Responsible Officer of the Indenture Trustee or Securities Administrator has actual knowledge to be so owned shall be so disregarded. Owners of Notes that have been pledged in good faith may be regarded as Holders if the pledgee establishes to the
satisfaction of the Securities Administrator or the Owner Trustee the pledgee’s right so to act with respect to such Notes and that the pledgee is not the Issuer, any other obligor upon the Notes or any Affiliate of any of the foregoing
Persons. 
  
 Offered Notes: The Class A Notes and the
Class M Notes. 
  
 Officer’s Certificate: With respect
to the Master Servicer, a certificate signed by the President, Managing Director, a Director, a Vice President or an Assistant Vice President, of the Master Servicer and delivered to the Indenture Trustee or the Securities Administrator, as
applicable. With respect to the Issuer, a certificate signed by any Authorized Officer of the Issuer, under the circumstances described in, and otherwise complying with, the applicable requirements of Section 10.01 of the Indenture, and
delivered to the Indenture Trustee. Unless otherwise specified, any reference in the Indenture to an Officer’s Certificate shall be to an Officer’s Certificate of any Authorized Officer of the Issuer. 
  
 One-Month LIBOR: With respect to any Accrual Period, the rate
determined by the Securities Administrator on the related Interest Determination Date on the basis of the 

  

 -22- 

 
London interbank offered rate for one-month United States dollar deposits, as such rates appear on the Telerate Screen Page 3750, as of 11:00 a.m. (London
time) on such Interest Determination Date. 
  
 In the event that
on any Interest Determination Date, Telerate Screen 3750 fails to indicate the London interbank offered rate for one-month United States dollar deposits, then One-Month LIBOR for the related Interest Accrual Period will be established by the
Securities Administrator as follows: 
  
 (a) If
on such Interest Determination Date two or more Reference Banks provide such offered quotations, One-Month LIBOR for the related Accrual Period shall be the arithmetic mean of such offered quotations (rounded upwards if necessary to the nearest
whole multiple of 1/16%). 
  
 (b) If on such
Interest Determination Date fewer than two Reference Banks provide such offered quotations, One-Month LIBOR for the related Accrual Period shall be the higher of (i) One-Month LIBOR as determined on the previous Interest Determination Date and
(ii) the Reserve Interest Rate. 
  
 The establishment of
One-Month LIBOR on each Interest Determination Date by the Securities Administrator and the Securities Administrator’s calculation of the rate of interest applicable for the related Accrual Period shall (in the absence of manifest error) be
final and binding. 
  
 Opinion of Counsel: A written
opinion of counsel acceptable to the Indenture Trustee which counsel may be in-house counsel for the Depositor or the Seller if acceptable to the Indenture Trustee and the Rating Agencies or outside counsel for the Depositor, the Seller, the Issuer
or the Master Servicer, as the case may be. 
  
 Outstanding: With respect to the Notes, as of the date of determination, all Notes theretofore executed, authenticated and delivered under this Indenture except: 
  
 (i) Notes theretofore canceled by the Note Registrar or delivered to the Securities Administrator for
cancellation; and 
  
 (ii) Notes in exchange for
or in lieu of which other Notes have been executed, authenticated and delivered pursuant to the Indenture unless proof satisfactory to the Securities Administrator is presented that any such Notes are held by a holder in due course. 
  
 Outstanding Mortgage Loan: With respect to any Due Date, a Mortgage
Loan which, prior to such Due Date, was not the subject of a Principal Prepayment in full, did not become a Liquidated Mortgage Loan and was not purchased or replaced. 
  
 Outstanding Principal Balance: As of the time of any determination, the principal balance of a Mortgage Loan
remaining to be paid by the Mortgagor, or, in the case of an REO Property, the principal balance of the related Mortgage Loan remaining to be paid by the Mortgagor at the time such property was acquired by the Trust. 
  

 -23- 

 Overcollateralization Deficiency Amount: With respect to any Payment Date, the amount, if any, by
which the Overcollateralization Target Amount exceeds the Overcollateralized Amount on such Payment Date (after giving effect to distributions in respect of the Basic Principal Payment Amount on such Payment Date). 
  
 Overcollateralization Floor: An amount equal to approximately 0.50% of
the aggregate Cut-off Date Balance. 
  
 Overcollateralization
Release Amount: With respect to any Payment Date, the lesser of (a) the Principal Funds for such Payment Date and (b) the amount, if any, by which the Overcollateralized Amount exceeds the Overcollateralization Target Amount on such
Payment Date (after giving effect to distributions in respect of the Basic Principal Payment Amount on such Payment Date). 
  
 Overcollateralization Target Amount: With respect to any Payment Date prior to the Stepdown Date, 3.00% of the aggregate Cut-off Date Balance. With
respect to any Payment Date on or after the Stepdown Date, the greater of (a) 6.00% of the aggregate Stated Principal Balance of the Mortgage Loans in respect of such Payment Date and (b) the Overcollateralization Floor; provided,
however, that if a Trigger Event is in effect on any Payment Date, the Overcollateralization Target Amount will be equal to the Overcollateralization Target Amount on the prior Payment Date. 
  
 Overcollateralized Amount: For any Payment Date, the amount, if any,
by which (a) the aggregate Stated Principal Balance of the Mortgage Loans in respect of such Payment Date exceeds (b) the aggregate Note Principal Balance of the Notes as of such Payment Date (after giving effect to distributions in
respect of the Basic Principal Payment Amount on such Payment Date). 
  
 Owner Trust Estate: The corpus of the Issuer created by the Trust Agreement, which consists of items referred to in Section 3.01 of the Trust Agreement. 
  
 Owner Trustee: Wilmington Trust Company and its successors and assigns or any successor owner trustee appointed
pursuant to the terms of the Trust Agreement. 
  
 Paying
Agent: Any paying agent or co-paying agent appointed pursuant to Section 3.03 of the Indenture, which initially shall be the Securities Administrator. 
  

Payment Account: The trust account or accounts created and maintained pursuant to Section 4.04 of the Sale and Servicing Agreement, which
shall be denominated “HSBC Bank USA, National Association, as Indenture Trustee f/b/o holders of People’s Choice Home Loan Securities Trust Series 2005-4, Mortgage-Backed Notes, Series 2005-4 - Payment Account.” The Payment Account
shall be an Eligible Account. 
  
 Payment Account Deposit
Date: The Business Day prior to each Payment Date. 
  
 Payment Date: The 25th day of each month, or if such day is not a Business Day, then the next Business Day, commencing in November 2005. 
  

 -24- 

 Percentage Interest: With respect to any Note, the percentage obtained by dividing the Note
Principal Balance of such Note by the aggregate Note Principal Balances of all Notes of that Class. With respect to any Certificate, the percentage as stated on the face thereof. 
  
 Periodic Rate Cap: With respect to each Mortgage Loan, the maximum adjustment that can be made to the Mortgage Rate
on each Interest Adjustment Date in accordance with its terms, regardless of changes in the applicable Index. 
  
 Permitted Investments: Any one or more of the following obligations or securities held for the benefit of the Noteholders, provided that any
bank or securities account otherwise permitted to be used by the Servicer or the Subservicer hereunder may be held “[Servicer or Subservicer] f/b/o Holders of People’s Choice Home Loan Securities Trust Mortgage-Backed Securities, Series
2005-4”: 
  
 (i) direct obligations of, and
obligations the timely payment of which are fully guaranteed by the United States of America or any agency or instrumentality of the United States of America the obligations of which are backed by the full faith and credit of the United States of
America; 
  
 (ii) (a) demand or time deposits,
federal funds or bankers’ acceptances issued by any depository institution or trust company incorporated under the laws of the United States of America or any state thereof (including the Indenture Trustee, Securities Administrator or the
Master Servicer or its Affiliates acting in its commercial banking capacity) and subject to supervision and examination by federal and/or state banking authorities, provided that the commercial paper and/or the short-term debt rating and/or
the long-term unsecured debt obligations of such depository institution or trust company at the time of such investment or contractual commitment providing for such investment have the Applicable Credit Rating or better from the Rating Agencies and
(b) any other demand or time deposit or certificate of deposit that is fully insured by the Federal Deposit Insurance Corporation; 
  
 (iii) repurchase obligations with respect to (a) any security described in clause (i) above or (b) any other security
issued or guaranteed by an agency or instrumentality of the United States of America, the obligations of which are backed by the full faith and credit of the United States of America, in either case entered into with a depository institution or
trust company (acting as principal) described in clause (ii)(a); 
  
 (iv) securities bearing interest or sold at a discount issued by any corporation (including the Indenture Trustee, Securities Administrator or the Master Servicer or its Affiliates) incorporated under the laws of the
United States of America or any state thereof that have the Applicable Credit Rating or better from the Rating Agencies at the time of such investment or contractual commitment providing for such investment; provided, however, that securities
issued by any particular corporation will not be Permitted Investments to the extent that investments therein will cause the then outstanding principal amount of securities issued by such corporation and held as part of the Trust to exceed 10% of
the aggregate Outstanding Principal Balances of all the 

  

 -25- 

 
Mortgage Loans and Permitted Investments held as part of the Trust as determined by the Master Servicer; 
  
 (v) commercial paper (including both non-interest-bearing
discount obligations and interest-bearing obligations payable on demand or on a specified date not more than one year after the date of issuance thereof) having the Applicable Credit Rating or better from the Rating Agencies at the time of such
investment; 
  
 (vi) a Reinvestment Agreement
issued by any bank, insurance company or other corporation or entity; 
  
 (vii) any other demand, money market or time deposit, obligation, security or investment as may be acceptable to the Rating Agencies as evidenced in writing by the Rating Agencies to the Securities Administrator; and

  
 (viii) any money market or common trust fund
having the Applicable Credit Rating or better from the Rating Agencies (if so rated by such Rating Agency), including any such fund for which the Indenture Trustee, Securities Administrator or Master Servicer or any affiliate of the Indenture
Trustee, Securities Administrator or Master Servicer acts as a manager or an advisor; provided, however, that no instrument or security shall be a Permitted Investment if such instrument or security evidences a right to receive only interest
payments with respect to the obligations underlying such instrument or if such security provides for payment of both principal and interest with a yield to maturity in excess of 120% of the yield to maturity at par or if such instrument or security
is purchased at a price greater than par as determined by the Master Servicer. 
  
 Person: Any individual, corporation, partnership, limited liability company, joint venture, association, joint-stock company, trust, unincorporated organization or government or any agency or political
subdivision thereof. 
  
 Plan: Any employee benefit plan or
certain other retirement plans and arrangements, including individual retirement accounts and annuities, Keogh plans and bank collective investment funds and insurance company general or separate accounts in which such plans, accounts or
arrangements are invested, that are subject to ERISA or Section 4975 of the Code. 
  
 Plan Assets: Assets of a Plan within the meaning of Department of Labor regulation 29 C.F.R. § 2510.3-101. 
  
 Pool Balance: With respect to any date of determination, the aggregate of the Stated Principal Balances of all Mortgage Loans as of such date.

  
 Prepayment Charge: With respect to a Mortgage Loan, the
prepayment charge or penalty interest required to be paid by the Mortgagor in connection with a prepayment of the related Mortgage Loan, as provided in the related Mortgage Note or Mortgage and specified on the related Mortgage Loan Schedule.

  

 -26- 

 Prepayment Interest Excess: With respect to any Payment Date, for each Mortgage Loan that was the
subject of a Principal Prepayment in full during the portion of the related Prepayment Period beginning on the first day of the calendar month in which such Payment Date occurs and ending on the 15th day of the calendar month in which such Payment Date occurs, an amount equal to interest (to the extent received) at the applicable Net Mortgage Rate on the
amount of such prepayment for the number of days commencing on the first day of the calendar month in which such Payment Date occurs and ending on the last date through which interest is collected from the related mortgagor. References to Principal
Prepayments include any unscheduled receipts of principal with respect to a Mortgage Loan (including as a result of a liquidation). 
  
 Prepayment Interest Shortfall: With respect to any Payment Date and any Mortgage Loan that was subject to (a) a principal prepayment in full
during the portion of the related Prepayment Period for Principal Prepayments in full beginning on the 16th day of
the calendar month before the calendar month in which such Payment Date occurs and ending on the last day of such preceding calendar month or (b) a Principal Prepayment in part during the related Prepayment Period for principal prepayments in
part, an amount equal to the difference between (i) interest actually received in the related Prepayment Period as a result of such principal prepayment in full or principal prepayment in part on such Mortgage Loan and (ii) the scheduled
interest portion of the monthly payment of such Mortgage Loan, adjusted to the applicable Net Mortgage Rate. References to Principal Prepayments include any unscheduled receipts of principal with respect to a Mortgage Loan (including as a result of
a liquidation). 
  
 Prepayment Period: With respect to any
Payment Date, (a) for Principal Prepayments in full (including as a result of a liquidation), the period beginning on the 16th day of the calendar month immediately preceding the month in which such Payment Date occurs, or, in the case of the first Prepayment Period, the Cut-Off Date, and ending on the 15th day of the calendar month in which such Payment Date occurs, and (b) for Principal Prepayments in part, the calendar month preceding the calendar month
in which such Payment Date occurs. References to Principal Prepayments include any unscheduled receipts of principal with respect to a Mortgage Loan (including as a result of a liquidation). 
  
 Primary Mortgage Insurance Policy: Any primary mortgage guaranty
insurance policy issued in connection with a Mortgage Loan which provides compensation to a Mortgage Note holder in the event of default by the obligor under such Mortgage Note or the related Security Instrument, if any, or any replacement policy
therefor through the related Accrual Period for such Class relating to a Payment Date. 
  
 Principal Deficiency Amount: For any Payment Date, the excess of the aggregate Note Principal Balance of the Notes (after giving effect to payments on such Payment Date) over the aggregate Stated Principal
Balance of the Mortgage Loans in respect of such Payment Date. On any Payment Date, for the purposes of calculating Accrued Note Interest only, the total Principal Deficiency Amount shall be allocated among the classes of Subordinate Notes in
reverse order of their seniority. Thus, for instance, the Principal Deficiency Amount for any Payment Date first will be allocated to the Class M11 Notes and, to the extent the Principal Deficiency Amount for such Payment Date exceeds the aggregate
Note Principal Balance of the 

  

 -27- 

 
Class M11 Notes, such Principal Deficiency Amount shall be allocated to the Class M10 Notes, and so on. 
  
 Principal Funds: For any Payment Date and any Loan Group or the
Mortgage Loans in the aggregate, as applicable, (a) the sum of (i) the principal portion of all scheduled monthly payments on the related Mortgage Loans due on the related Due Date, to the extent received or advanced; (ii) the
principal portion of all proceeds of the repurchase of a Mortgage Loan in the related Loan Group (or, in the case of a substitution, certain amounts representing a principal adjustment) as required by the Mortgage Loan Purchase Agreement during the
preceding calendar month; (iii) the principal portion of all other unscheduled collections received during the preceding calendar month in respect of the related Mortgage Loans, including full and partial prepayments, the proceeds of any
repurchase of such Mortgage Loans or redemption of the Notes by the Seller or holder of the Owner Trust Certificates, Liquidation Proceeds and Insurance Proceeds, including any amounts recovered with respect to a Mortgage Loan subsequent to the
liquidation or charge-off of such Mortgage Loan, in each case to the extent applied as recoveries of principal; net of (b) any amounts, without duplication, paid and reimbursed to the Master Servicer, the Servicer, the Subservicer, the
Securities Administrator, the Custodian, the Indenture Trustee and the Owner Trustee out of funds in the Custodial Account or the Payment Account, other than any unreimbursed Extraordinary Expenses or other expenses, costs or liabilities payable out
of Net Monthly Excess Cashflow on that Payment Date (to the extent not reimbursed from Interest Funds). 
  
 Principal Payment Amount: For any Payment Date, the Basic Principal Payment Amount plus the Extra Principal Payment Amount. 
  
 Principal Prepayment: Any payment (whether partial or full) or other
recovery of principal on a Mortgage Loan which is received in advance of its scheduled Due Date to the extent that it is not accompanied by an amount as to interest representing scheduled interest due on any date or dates in any month or months
subsequent to the month of prepayment, including Insurance Proceeds and Repurchase Proceeds, excluding the principal portion of Net Liquidation Proceeds received at the time the Mortgage Loan becomes a Liquidated Mortgage Loan. 
  
 Proceeding: Any suit in equity, action at law or other judicial or
administrative proceeding. 
  
 Prospectus: The Prospectus
Supplement, dated October 24, 2005, together with the Prospectus attached thereto and dated June 10, 2005. 
  
 Purchaser: People’s Choice Home Loan Securities Corp., a Delaware corporation, and its successors and assigns. 
  
 Qualified Appraiser: An appraiser, who provides or provided an
appraisal of a Mortgaged Property, who had no interest, direct or indirect, in the Mortgaged Property or in any loan made on the security thereof, and whose compensation is or was not affected by the approval or disapproval of the related Mortgage
Loan, which appraiser and the appraisal made by such appraiser both satisfy the requirements of Title XI of FIRREA and the regulations promulgated thereunder, all as in effect on the date the Mortgage Loan was originated. 
  

 -28- 

 Qualified REIT Subsidiary: A direct or indirect 100% owned subsidiary of a REIT that satisfies the
requirements of Section 856(i) of the Code. 
  
 Qualified
Insurer: Any insurance company duly qualified as such under the laws of the state or states in which the related Mortgaged Property or Mortgaged Properties is or are located, duly authorized and licensed in such state or states to transact the
type of insurance business in which it is engaged and approved as an insurer by the Master Servicer, so long as the claims paying ability of which is acceptable to the Rating Agencies for mortgage-backed notes having the same rating as the Notes
rated by the Rating Agencies as of the Closing Date. 
  
 Rating
Agency: Any nationally recognized statistical rating organization, or its successor, that rated the Notes at the request of the Depositor at the time of the initial issuance of the Notes. Initially, Fitch, Standard & Poor’s and
Moody’s. If such organization or a successor is no longer in existence, “Rating Agency” with respect to the Notes shall be such nationally recognized statistical rating organization, or other comparable Person, designated by the
Depositor, notice of which designation shall be given to the Indenture Trustee and Master Servicer. References herein to the highest short term unsecured rating category of a Rating Agency shall mean A-1 or better in the case of Standard &
Poor’s, P-1 in the case of Moody’s and in the case of any other Rating Agency shall mean such equivalent ratings. References herein to the highest long-term rating category of a Rating Agency shall mean “AAA” in the case of
Standard & Poor’s, “Aaa” in the case of Moody’s and in the case of any other Rating Agency, such equivalent rating. 
  
 Realized Loss: Any (a) Bankruptcy Loss or (b) as to any Liquidated Mortgage Loan, (i) the Outstanding Principal Balance of such
Liquidated Mortgage Loan plus accrued and unpaid interest thereon at the Mortgage Rate through the last day of the month of such liquidation, less (ii) the related Net Liquidation Proceeds with respect to such Mortgage Loan and the related
Mortgage Property. 
  
 Record Date: With respect to any
Book-Entry Notes and any Payment Date, the close of business on the Business Day immediately preceding such Payment Date. 
  
 Reference Banks: Leading banks selected by the Securities Administrator and engaged in transactions in Eurodollar deposits in the international
Eurocurrency market (a) with an established place of business in London, (b) whose quotations appear on the Telerate Screen Page 3750 on the Interest Determination Date in question, (c) which have been designated as such by the
Securities Administrator and (d) not controlling, controlled by, or under common control with, the Company or the Seller. 
  
 Reinvestment Agreements: One or more reinvestment agreements, acceptable to the Rating Agencies, from a bank, insurance company or other
corporation or entity (including the Indenture Trustee). 
  
 Relief Act: The Servicemembers Civil Relief Act, as amended, or any similar state law. 
  
 Relief Act Mortgage Loan: Any Mortgage Loan as to which the Scheduled Payment thereof has been reduced due to the application of the Relief Act.

  

 -29- 

 REIT: A real estate investment trust within the meaning of section 856 and 857 of the Code.

  
 REO Property: A Mortgaged Property acquired in the name
of the Indenture Trustee, for the benefit of the Noteholders, by foreclosure or deed-in-lieu of foreclosure in connection with a defaulted Mortgage Loan. 
  
 Repurchase Price: With respect to any Mortgage Loan required to be repurchased, an amount equal to the sum of (a) 100% of the Stated Principal
Balance of such Mortgage Loan in respect of the Payment Date occurring in the month in which the repurchase takes place plus accrued but unpaid interest on such Stated Principal Balance at the related Mortgage Rate through and including the last day
of the month of repurchase, (b) any unreimbursed Monthly Advances and Servicing Advances payable to the Servicer, the Subservicer and/or the Master Servicer in respect of such Mortgage Loan and (c) any costs and damages incurred by the
Trust in connection with any violation of such Mortgage Loan of any anti-predatory lending laws. 
  
 Repurchase Proceeds: The Repurchase Price in connection with any repurchase of a Mortgage Loan by the Seller and any cash deposit in connection
with the substitution of a Mortgage Loan. 
  
 Request for
Release: A request for release in the form attached to the Sale and Servicing Agreement as Exhibit B and the Custodial Agreement as Exhibit Four. 
  
 Required Insurance Policy: With respect to any Mortgage Loan, any insurance policy which is required to be maintained from time to time under the
Sale and Servicing Agreement with respect to such Mortgage Loan. 
  
 Reserve Interest Rate: With respect to any Interest Determination Date, the rate per annum that the Securities Administrator determines to be either (a) the arithmetic mean (rounded upwards if necessary to the nearest whole
multiple of 0.0625%) of the one-month United States dollar lending rates which New York City banks selected by the Securities Administrator are quoting on the relevant Interest Determination Date to the principal London offices of leading banks in
the London interbank market or (b) in the event that the Securities Administrator can determine no such arithmetic mean, the lowest one-month United States dollar lending rate which New York City banks selected by the Securities Administrator
are quoting on such Interest Determination Date to leading European banks. 
  
 Responsible Officer: With respect to the Securities Administrator, any officer of the Securities Administrator with direct responsibility for the administration of the Indenture and also, with respect to a
particular matter, any other officer to whom such matter is referred because of such officer’s knowledge of and familiarity with the particular subject; and with respect to the Indenture Trustee, any vice president, assistant vice president,
any assistant secretary or any assistant treasurer or any other officer of the Indenture Trustee working in its Corporate Trust Office customarily performing functions similar to those performed by any of the above designated officers who at such
time shall be officers to whom, with respect to a particular matter, such matter is referred because of such officer’s knowledge of and familiarity 

  

 -30- 

 
with the particular subject or who shall have direct responsibility for the administration of this Indenture. 
  
 Retained Notes: Those certain Classes, or portions of certain Classes,
of Notes that, at the time of their issuance, People’s Choice Financial Corporation or one of its Qualified REIT Subsidiaries acquires beneficial ownership thereof. 
  
 Rolling Three-Month Delinquency Rate: With respect to any Payment Date, the average of the Delinquency Rates for each
of the three (or one and two, in the case of the first and second Payment Dates, respectively) immediately preceding months 
  
 Sale and Servicing Agreement: The Sale and Servicing Agreement, dated as of October 1, 2005, among the Depositor, the Issuer, the Indenture
Trustee, Wells Fargo Bank, National Association, as master servicer and securities administrator, People’s Choice Funding, Inc., as seller and company, the Servicer and the Subservicer. 
  
 Sarbanes Certifying Party: The Master Servicer. 
  
 Scheduled Payment: With respect to any Mortgage Loan and any month,
the scheduled payment or payments of principal and interest due during such month on such Mortgage Loan which either is payable by a Mortgagor in such month under the related Mortgage Note or, in the case of REO Property, would otherwise have been
payable under the related Mortgage Note. 
  
 Scheduled
Principal: The principal portion of any Scheduled Payment. 
  
 Securities Act: The Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder. 
  
 Securities Administrator: Wells Fargo Bank, National Association, or its successor in interest, or any successor securities administrator appointed
as herein provided. 
  
 Security: Any of the Certificates
or Notes. 
  
 Securityholder or Holder: Any
Noteholder or a Certificateholder. 
  
 Security Instrument:
A written instrument creating a valid first lien on a Mortgaged Property securing a Mortgage Note, which may be any applicable form of mortgage, deed of trust, deed to secure debt or security deed, including any riders or addenda thereto.

  
 Seller: People’s Choice Funding, Inc., and its
successors and assigns. 
  
 Senior Enhancement Percentage:
For any Payment Date, the percentage obtained by dividing (a) the excess, if any of (i) the sum of (A) the aggregate Note Principal Balance of the Class M Notes and (A) the related Overcollateralized Amount over (ii) the
total Principal Deficiency Amount, in each case after giving effect to the distribution of the Principal Payment Amount on such Payment Date, by (b) the aggregate Stated Principal Balance of the Mortgage Loans for that Payment Date. 

 

 -31- 

 Senior Principal Payment Amount: For any Payment Date on or after the Stepdown Date, as long as a
Trigger Event has not occurred with respect to such Payment Date, the lesser of (a) the Principal Payment Amount, and (b) an amount equal to the excess (if any) of (i) the aggregate Note Principal Balance of the Class 1A1, Class 1A2,
Class 1A3 and Class 2A1 Notes immediately prior to such Payment Date over (ii) the lesser of (A) the aggregate Stated Principal Balance of the Mortgage Loans in respect of such Payment Date multiplied by approximately 54.60% and
(B) the amount, if any, by which (1) the aggregate Stated Principal Balance of the Mortgage Loans in respect of such Payment Date exceeds (2) the Overcollateralization Floor. 
  
 Servicer: EMC Mortgage Corporation and its successors and assigns, or
any successor servicer appointed pursuant to the provisions of the Servicing Agreement. 
  
 Servicer Remittance Date: With respect to each Mortgage Loan, the 18th day of
any month, or if such 18th day is not a Business Day, the first Business Day immediately succeeding such
18th day. 
  
 Servicing Advance: As defined in the Servicing Agreement. 
  

Servicing Agreement: The Servicing Agreement, dated as of October 1, 2005, among EMC Mortgage Corporation, as Servicer, the Issuer, the
Master Servicer, the Subservicer and the Indenture Trustee. 
  
 Servicing Fee: With respect to each Mortgage Loan and for any calendar month, an amount equal to one twelfth of the product of the Servicing Fee Rate multiplied by the Stated Principal Balance of the Mortgage Loans as of the Payment
Date in the preceding calendar month. 
  
 Servicing Fee
Rate: On each Mortgage Loan, 0.50% per annum, comprised of the Servicer’s fee rate of 0.03% per annum plus the Subservicer’s fee rate of 0.47% per annum, which includes the portion thereof that the Subservicer is
required to remit to the Seller pursuant to the Subservicing Agreement. 
  
 Servicing Officer: Any supervisory or management officer of the Servicer or Subservicer, as applicable, involved in or responsible for the administration and servicing or subservicing, as the case may be, of Mortgage Loans included
in the Trust, whose name appears on a list of servicing officers appearing in an Officer’s Certificate furnished by the Servicer or Subservicer, as applicable, to the Indenture Trustee, in which certificate the Servicer certifies that such
officers are in supervisory or management roles, as such list may be amended from time to time. 
  
 Special Derivative Contract: Any ISDA Master Agreement, together with the related Schedule and Confirmation, entered into by the Indenture Trustee
and a Special Derivative Counterparty in accordance with Section 3.28 of the Indenture. 
  
 Special Derivative Counterparty: Any counterparty to a Special Derivative Contract as provided in Section 3.28 of the Indenture. 
  

 -32- 

 Standard & Poor’s: Standard & Poor’s, a division of The McGraw-Hill
Companies, Inc., or its successor in interest. 
  
 Stated
Principal Balance: With respect to any Mortgage Loan or related REO property as of any Payment Date, the principal balance thereof as of the Cut-off Date, reduced by the sum of (a) the principal portion of the scheduled principal payments
due with respect to such Mortgage Loan during each due period ending prior to such Payment Date (to the extent received or advanced), (b) all principal prepayments with respect to such Mortgage Loan received prior to or during the related
prepayment period, and all liquidation proceeds to the extent applied as recoveries of principal with respect to such Mortgage Loan, that were received by the master servicer, the servicer or the subservicer as of the close of business on the last
day of the prepayment period related to such Payment Date and (c) any realized losses on such Mortgage Loan incurred during the related prepayment period. The stated principal balance of a liquidated Mortgage Loan equals zero. 
  
 Statutory Trust Statute: Chapter 38 of Title 12 of the Delaware Code,
12 Del. Code §§3801 et seq., as the same may be amended from time to time. 
  
 Stepdown Date: The earlier to occur of (a) the first Payment Date on which the aggregate Note Principal Balance of the Class A Notes has been reduced to zero and (b) the later to occur of
(x) the Payment Date occurring in November 2008 and (y) the first Payment Date on which the Senior Enhancement Percentage (calculated, for this purpose only, before giving effect to payments on the Notes on such Payment Date, but using the
Stated Principal Balance of the Mortgage Loans for such Payment Date) is greater than or equal to 45.40% but after giving effect to payments of principal on the Mortgage Loans. 
  
 Step-Up Date: The first Payment Date following the first month in which the aggregate Stated Principal Balance of the
Mortgage Loans, and properties acquired in respect thereof, remaining in the Trust has been reduced to less than or equal to 10% of the aggregate Cut-off Date Balance. 
  
 Subordinate Notes: The Class M Notes. 
  
 Subservicer: People’s Choice Home Loan, Inc., as the designee of People’s Choice Funding, Inc., to perform
the duties of the Subservicer pursuant to the Subservicing Agreement, and its successors in interest and permitted assigns and any other subservicer that may be appointed in the future to replace People’s Choice Home Loan, Inc. in such
capacity. 
  
 Subservicing Agreement: That certain
subservicing agreement, dated as of October 1, 2005, between the Servicer and the Subservicer, as it may be amended, supplemented, restated or replaced from time to time. 
  
 Subservicing Fee: With respect to each Mortgage Loan and for any calendar month, an amount equal to one twelfth of
the product of the Subservicing Fee Rate multiplied by the Stated Principal Balance of the Mortgage Loans as of the Payment Date in the preceding calendar month. 
  
 Subservicing Fee Rate: With respect to any Mortgage Loan, 0.47% per annum. 
  

 -33- 

 Substitute Mortgage Loan: A Mortgage Loan substituted by the Seller for a Mortgage Loan as to
which a breach of one or more of the Seller’s representations and warranties made in the Mortgage Loan Purchase Agreement has occurred, which Mortgage Loan must, on the date of such substitution, (a) have a Stated Principal Balance, after
deduction of the principal portion of the scheduled monthly payment due in the month of substitution, not in excess of the Stated Principal Balance of the deleted Mortgage Loan; (b) be accruing interest at a rate no lower than that of (and not
more than 1.00% per annum higher than that of) the deleted Mortgage Loan; (c) have a Loan-to-Value Ratio no higher than that of the deleted Mortgage Loan; (d) have a remaining term to maturity no greater than one year more than that
of (and no greater than one year less than that of) the deleted Mortgage Loan; and (e) comply with each representation and warranty made by the Seller in the Mortgage Loan Purchase Agreement. 
  
 Swap Agreement: The interest rate Swap Agreement between the Indenture
Trustee and the Swap Provider for the benefit of the Notes. 
  
 Swap Provider: Swiss Re Financial Products Corporation. 
  
 Swap Provider Trigger Event: With respect to any Payment Date, (a) an Event of Default under the interest rate Swap Agreement with respect to which the Swap Provider is a Defaulting Party (as defined in the interest rate Swap
Agreement), (b) a Termination Event under the interest rate Swap Agreement with respect to which the Swap Provider is the sole Affected Party (as defined in the interest rate Swap Agreement) or (c) an Additional Termination Event under the
interest rate Swap Agreement with respect to which the Swap Provider is the sole Affected Party. 
  
 Swap Termination Payment: Any lump-sum amount calculated in accordance with the Swap Agreement in connection with an “Event of Default”,
a “Termination Event” or an “Additional Termination Event” under the Swap Agreement. 
  
 Telerate Screen Page 3750: The display designated as page 3750 on the Telerate Service (or such other page as may replace page 3750 on that service
for the purpose of displaying London interbank offered rates of major banks). 
  
 Treasury Regulations: Regulations, including proposed or temporary Regulations, promulgated under the Code. References herein to specific provisions of proposed or temporary regulations shall include analogous
provisions of final Treasury Regulations or other successor Treasury Regulations. 
  
 Trigger Event: A Trigger Event is in effect with respect to any Payment Date if: 
  
 (a) the Rolling Three-Month Delinquency Rate as of the close of business on the last day of the preceding calendar month exceeds 33.00% of
the Senior Enhancement Percentage; or 
  

 -34- 

 (b) the cumulative amount of Realized Losses incurred on the Mortgage Loans from the
Cut-off Date through the end of the calendar month immediately preceding such Payment Date exceeds the applicable percentage set forth below of the Cut-off Date Balance: 
  

			
	 Distribution Date

	  	 Loss Percentage

	 November 2007 through October 2008
	  	 1.60% plus 1/12th of 2.00% for each
 month thereafter

		
	 November 2008 through October 2009
	  	 3.60% plus 1/12th of 2.05% for each
 month thereafter

		
	 November 2009 through October 2010
	  	 5.65% plus 1/12th of 1.10% for each
 month thereafter

		
	 November 2010 through October 2011
	  	 6.75% plus 1/12th of 0.50% for each
 month thereafter

		
	 November 2011 through October 2012
	  	 7.25% plus 1/12th of 0.95% for each
 month thereafter

		
	 November 2012 and thereafter
	  	 8.20%

  
 Trust:
People’s Choice Home Loan Securities Trust Series 2005-4, created on October 11, 2005, and as amended and restated from time to time pursuant to the Trust Agreement. 
  
 Trust Agreement: The Amended and Restated Trust Agreement dated as of October 26, 2005, among the Owner Trustee,
the Depositor and Wells Fargo Bank, National Association, as securities administrator, certificate registrar and certificate paying agent, relating to the Trust. 
  
 Trust Estate: The meaning specified in the Granting Clause of the Indenture. 
  
 Trust Indenture Act or TIA: The Trust Indenture Act of 1939, as
amended from time to time, as in effect on any relevant date. 
  
 UCC: The Uniform Commercial Code, as amended from time to time, as in effect in any specified jurisdiction. 
  
 Underwriters: Bear Stearns & Co. Inc., Lehman Brothers Inc., Credit Suisse First Boston LLC and UBS Securities LLC. 
  
 Uninsured Cause: Any cause of damage to a Mortgaged Property or
related REO Property such that the complete restoration of such Mortgaged Property or related REO Property is not fully reimbursable by the hazard insurance policies required to be maintained pursuant to the Servicing Agreement, without regard to
whether or not such policy is maintained. 
  

 -35-Purchase Contract

 Exhibit 10.3 
  
 Document no. 1577 for 2005 
  
 Heard 
  
 in Cologne on 22 September 2005. 
  
 There appeared before me 
  
 Wolfgang Gruntkowski, Notary Public, 
  
 Notary public for Cologne Higher Regional Court with offices in Cologne 
  

	1a.	Mr. Rolf Breuer, MBA, born on 19 January 1951, with his place of business at Jülicher Strasse 26, 50674 Cologne, 

  

	1b.	Mr. Fritz Eduard Skrzypczak, born on 23 May 1936, with his place of business at Louisenstrasse 119-121, 61348 Bad Homburg von der Höhe. 

  
 Parties 1.a) and 1.b) are not acting for themselves personally but

  

	a)	as managing directors, with joint power of representation and exempt from the restrictions contained in § 181 Civil Code, of the limited liability company with the name of
Euroareal Holding Projekt Mainz Hechtsheimerstrasse GmbH registered in the Commercial Register of Cologne Municipal Court as [HR] B 52583, having its registered office in Cologne and with its business address at Jülicher Strasse 26,
50674 Cologne. 

	 	•	 	the company Euroareal Holding Projekt Mainz Hechtsheimerstrasse GmbH being hereinafter referred to as “Seller” – 

  

	b)	as managing directors, with joint power of representation and exempt from the restrictions contained in § 181 Civil Code, of the limited liability company with the name of
Euroareal Mainz Verwaltungsgebäude Hechtsheimerstrasse GmbH registered in the Commercial Register of Cologne Municipal Court as [HR] B 52649, having its registered office in Cologne and with its business address at Jülicher Strasse
26, 50674 Cologne. 

  

	c)	lastly, as managing directors, with joint power of representation and exempt from the restrictions contained in § 181 Civil Code, of the limited liability company with the name
of Euroareal Mainz Produktionsgebäude Hechtsheimerstrasse GmbH registered in the Commercial Register of Cologne Municipal Court as [HR] B 52656, having its registered office in Cologne and with its business address at Jülicher
Strasse 26, 50674 Cologne. 

  

	d)	in addition, with respect to Mr. Rolf Breuer, as managing director, with sole power of representation and exempt from the restrictions contained in § 181 Civil Code, of
the company with the name of Euroareal Beteiligungs GmbH registered in the Commercial Register of Cologne Municipal Court as [HR] B 42719, having its registered office in Frechen and with its business address at Kölner Strasse 9, 50226
Frechen, 

  

	e)	in addition, with respect to Mr. Fritz Eduard Skrzypczak, as verbally authorised representative of the limited liability company with the name of Cooperative für Planen
und Bauen GmbH registered in the Commercial Register of Bad Homburg von der Höhe Municipal Court as [HR] B 5852, having its registered office in Bad Homburg and with its business address at Louisenstrasse 119-121, 61348 Bad Homburg.
Undertaking provided to forward notarial confirmation of power of attorney. 

	2.	Mr. Jon Hardy Paulsen, born on 4 March 1963, residing at 560 Mission Street Suite 2900 San Francisco, California, acting here as managing director with sole power of
representation and exempt from the restrictions contained in § 181 Civil Code, of the limited liability company with the name of Digital Realty Trust Germany 1 GmbH (formerly Einhundertdreiundsechzigste Verwaltungsgesellschaft Dammtor mbH)
registered in the Commercial Register of Hamburg Municipal Court as [HR] B 93 395, having its registered office in Hamburg and with its business address at Warburgstrasse 50 (c/o Latham & Watkins LLP), 20354 Hamburg.

  
 The latter acting: 
  
 a) on its own behalf, 
  

	 	•	 	Digital Realty Trust Germany 1 GmbH (formerly Einhundertdreiundsechzigste Verwaltungsgesellschaft Dammtor mbH) being hereinafter referred to as “ Buyer2a”
– 

  
 b) as personally liable
shareholder with sole power of representation of the limited partnership] formed on the date hereof with the name LBC-Digital Realty Trust Germany 1 GmbH & Co. KG having its registered office in Hamburg and with its business address
at Warburgstrasse 50 (c/o Latham & Watkins LLP), 20354 Hamburg. 
  

	 	•	 	LBC-Digital Realty Trust Germany 1 GmbH & Co. KG 1. Gr. being hereinafter referred to as “ Buyer2b” – 

 According to Deed dated 21 September 2005, Document no. 1249 for 2005 of notary public Dr. Ascan Pinckernelle
in Hamburg, the name of the aforementioned limited liability company was changed to Digital Realty Trust Germany I GmbH and Mr. Jon Hardy Paulsen was appointed as its managing director with sole power of representation and exempt from
the restrictions contained in § 181 Civil Code. The corresponding entries have not yet been made in the Commercial Register. 
  
 Parties 1a) and 1b) are personally known to the notary. 
  
 Party 2 provided evidence of his identity by presenting his US passport and consented to a copy being made. 
  
 The Parties, acting as stated, declared: 
  
 I. 
  

	1.	The Seller has shares with a nominal value of €25,000 in the limited liability company with the name of Euroareal Mainz Verwaltungsgebäude Hechtsheimerstrasse GmbH
registered in the Commercial Register of Cologne Municipal Court as [HR] B 52649, having its registered office in Cologne, the fully paid up nominal capital of which is €25,000. 

  

	2.	The Seller has shares with a nominal value of €25,000 in the limited liability company with the name of Euroareal Mainz Produktionsgebäude Hechtsheimerstrasse GmbH
registered in the Commercial Register of Cologne Municipal Court as [HR] B 52656, having its registered office in Cologne, the fully paid up nominal capital of which is EUR 25,000. 

 Parties 1a) and 1b), acting as stated, then declared: 
  

	1.	The Seller hereby submits 

  

	 	a)	to the limited liability company with the name of Digital Realty Trust Germany 1 GmbH (formerly Einhundertdreiundsechzigste Verwaltungsgesellschaft Dammtor mbH) registered in
the Commercial Register of Hamburg Municipal Court as [HR] B 93 395, having its registered office in Hamburg and with its business address at Warburgstrasse 50 (c/o Latham & Watkins LLP), 20354 Hamburg 

  

	 	•	 	hereinafter referred to as “Buyer2a)” – 

  

	 	b)	to the limited partnership formed on the date hereof with the name LBC-Digital Realty Trust Germany 1 GmbH & Co. KG having its registered office in Hamburg and with
its business address at Warburgstrasse 50 (c/o Latham & Watkins LLP), 20354 Hamburg, 

  

	 	•	 	hereinafter referred to as “Buyer 2b)” – 

  
 the offer to enter into the Outline Agreement contained in the Attachment to this Deed. 
  

	2.	The period for acceptance of the Outline Agreement shall end on 10 October 2005, until which date the offer is irrevocable. 

  

	3.	The Outline Agreement has come into force if by said date the declaration of acceptance has been officially authenticated by a German notary public, without the need for receipt of
the declaration of acceptance. 

 The notary who authenticates the acceptance is however requested to immediately send the authenticating
notary a copy of the deed of acceptance. 
  
 The acceptance shall
come into effect if the notary for the offer has been authorised in the deed of acceptance to deal with the agreement. 
  

	4.	The Parties themselves shall provide the declarations of consent by the company and/or the shareholders that are required by statute or by the Articles of Association.

  

	5.	All declarations of consent shall come into effect in relation to the Parties upon receipt by the authenticating notary. 

  

	6.	Purely as a precaution the Seller reiterates and confirms all powers of attorney and authorisations contained in the Outline Agreement enclosed as an Attachment to the Deed.

  
 II. 
  

	1.	The Buyer has noted this offer without as yet accepting it. 

  

	2.	The Buyers hereby undertake to bear the costs associated with this Deed in proportion to the shareholdings listed in the Deed. 

 The above deed together with the Attachment was read aloud by the notary to the Parties appearing,
approved by them and signed by them and by the notary in their own writing, as follows: 
  

	
	
	  
	 [signatures]

  
 § 1 

Framework Deed 
  
 The Seller is in each case sole shareholder of 
  

	(i)	Euroareal Mainz Verwaltungsgebäude Hechtsheimerstrasse GmbH and 

  

	(ii)	Euroareal Mainz Produktionsgebäude Hechtsheimerstrasse GmbH. 

  
 The Buyers wish to acquire both the aforementioned companies subject more specifically to the Purchase Contract attached to this Framework Deed as Appendices 1 and
2. 
  
 § 2 
 Conclusion of Purchase Contract for 
 Euroareal Mainz Verwaltungsgebäude Hechtsheimerstrasse GmbH 
  
 The Parties hereby enter into the Purchase Contract attached as Attachment 1 for all shares in Euroareal Mainz Verwaltungsgebäude Hechtsheimerstrasse GmbH. 
  
 § 3 
 Conclusion of Purchase Contract for 
 Euroareal Mainz Produktionsgebäude Hechtsheimerstrasse GmbH 
  
 The Parties hereby enter into the Purchase Contract attached as Attachment 2 for all
shares in Euroareal Mainz Produktionsgebäude Hechtsheimerstrasse GmbH. 

  
 § 4 

Interdependence of deeds of sale attached as Appendices 1 and 2 
  
 The Parties agree that the deeds of sale attached to this Framework Deed as Appendices 1 and 2 are only to be implemented jointly. The
obligation of the Parties to use their best endeavours to implement the deeds simultaneously remains unaffected by this rule. Reference is additionally made to § 10 of Attachment 1 and § 11 of Attachment 2. 
  
 § 5 
 Costs 
  
 With regard
to the costs of this Outline Agreement and the Purchase Agreements reference is made to the rules in § 13 Section 1 of Attachment 1 and to § 14 Section 1 of Attachment 2. 
  
 § 6 
 Approval 
  
 The
declarations made in this Deed may be approved by the end of 10 October 2005 at midnight. 

 Attached as Attachment to Deed of Wolfgang Gruntkowski, notary, in Cologne dated this day, Document no. 1677 for 2005.

  
 Cologne, 22 September 2005 
  

	
	
	  
	[signatures]

  
 PROJECT MAINZ

  
 Hechtsheimer Strasse 
 Verwaltungsgebäude 
  
 PURCHASE CONTRACT 
  
 between 
  

	1.	the limited liability company with the name of Euroareal Holding Projekt Mainz Hechtsheimerstrasse GmbH registered in the Commercial Register of Cologne Municipal Court as
[HR} B 52583, having its registered office in Cologne and with its business address at Jülicher Strasse 26, 50674 Cologne, 

  

	 	•	 	the company Euroareal Holding Projekt Mainz Hechtsheimerstrasse GmbH being hereinafter referred to as “Seller” –  

  

	2.	     

  

	a)	the limited liability company with the name of Digital Realty Trust Germany 1 GmbH (formerly Einhundertdreiundsechzigste Verwaltungsgesellschaft Dammtor mbH) registered in
the Commercial Register of Hamburg Municipal Court as [HR] B 93 395, having its registered office in Hamburg and with its business address at Warburgstrasse 50 (c/o Latham & Watkins LLP), 20354 Hamburg, 

  

	b)	the limited partnership formed on the date hereof with the name LBC-Digital Realty Trust Germany 1 GmbH & Co. KG having its registered office in Hamburg and with its
business address at Warburgstrasse 50 (c/o Latham & Watkins LLP), 20354 Hamburg, 

	 	•	 	Digital Realty Trust Germany 1 GmbH (formerly Einhundertdreiundsechzigste Verwaltungsgesellschaft Dammtor mbH) and LBC-Digital Realty Trust Germany 1 GmbH & Co.
KG hereinafter referred to as “Buyers 2a) and 2b)” – 

  
 with the involvement of 
  

	3.	the limited liability company with the name of Euroareal Beteiligungs GmbH registered in the Commercial Register of Cologne Municipal Court as [HR] B 42719, having its registered
office in Frechen and with its business address at Kölner Strasse 9, 50226 Frechen, 

  

	4.	the limited liability company with the name of Cooperative für Planen und Bauen GmbH registered in the Commercial Register of Bad Homburg von der Höhe Municipal
Court as [HR] B 5852, having its registered office in Bad Homburg and with its business address at Louisenstrasse 119-121, 61348 Bad Homburg von der Höhe, 

  

	5.	the limited liability company with the name of Euroareal Mainz Verwaltungsgebäude Hechtsheimerstrasse GmbH registered in the Commercial Register of Cologne Municipal
Court as [HR] B 52649, having its registered office in Cologne and with its business address at Jülicher Strasse 26, 50674 Cologne, 

  

	6.	the limited liability company with the name of Euroareal Mainz Produktionsgebäude Hechtsheimerstrasse GmbH registered in the Commercial Register of Cologne Municipal
Court as B 52656, having its registered office in Cologne and with its business address at Jülicher Strasse 26, 50674 Cologne. 

  
 § 1 

Purpose of Agreement 
  

	1.	The Seller who has shares with a nominal value of €25,000 is sole shareholder of the limited liability company with the name of Euroareal Mainz Verwaltungsgebäude
Hechtsheimerstrasse GmbH registered in the Commercial Register of Cologne Municipal Court as [HR] B 52649, having its registered office in Cologne, the fully paid up nominal capital of which is €25,000 (in words: twenty five thousand
euros). The aforementioned company is hereinafter referred to as “Euroareal Verwaltungsgebäude”). 

  

	2.	To simplify the implementation of this Purchase Contract a Reference Document was drawn up on September 22, 2005, Document No. 1576 for 2005 by the authenticating notary.
This document is also referred to hereinafter as “Reference Document.” A certified copy of the Reference Document was available during the authentication and was provided to the Parties for inspection. Reference is made to the
contents of the Reference Deed. The Parties hereby confirm the powers of attorney for the purpose of authenticating the Reference Deed and waive their right to be informed of the meaning of the reference to its being read aloud again and attached to
this copy. The Parties confirm that they are aware of the contents of the Reference Deed. 

  

	3.	Euroareal Verwaltungsgebäude is the owner of the property registered on Sheet 4444 of the Land Register of the Municipal Court of Mainz for Weisenau in the communal district of
Weisenau, consisting of field 2, parcel 35/20, buildings and undeveloped land, at Hechtsheimer Strasse 2, measuring 65,829 square meters. On this property there are buildings 12/1, 12/2, 9, 20 and 82 as well as 354 parking places as shown in the
site plan. It is also referred to hereinafter as the “subject of purchase” and is delineated in red in the plan attached as 

  
 Attachment “Site
plan” 
  
 for the purpose of providing details of the
location of the subject of purchase in this record. 
  

	4.	The following encumbrances are registered in the Land Register: 

  
 Section II: 
  

			
	Current no. 1	  	Limited personal easement (water connection right associated with restrictions on use) for the city of Mainz (public utilities),
		
	Current no. 2	  	Limited personal easement (right to maintain water supply pipes and a gas pipe associated with surge and growth restrictions) for the city of Mainz (public utilities),
		
	Current no. 3	  	Limited personal easement (right to lay, operate and maintain high-pressure gas pipes associated with restrictions on development and growth) for Stadtwerke Mainz Aktiengesellschaft in
Mainz.
		
	Current no.	  	4-7 cancelled,
		
	Current no. 8	  	Limited personal easement (right to supply and waste disposal pipes) for Stadtwerke Mainz AG, Mainz.

  
 Section III: 
  

			
	Current no. 1:	  	€5,000,000 uncertificated land charge for Debeka Bausparkasse Aktiengesellschaft, Koblenz am Rhein, plus 10% interest per annum,

			
	Current no. 2:	  	€€46,000,000 uncertificated land charge for Debeka Bausparkasse Aktiengesellschaft, Koblenz am Rhein, plus 10% interest per annum,
		
	Current no. 3:	  	€€51,000,000 land charge for Credit Suisse First Boston, London, plus 18% interest per annum, plus a one-time ancillary payment of 10%.

  
 The Land Register’s entries were
taken on 19 September 2005. Cancellation of the land charges in favour of Debeka Bausparkasse Aktiengesellschaft was applied for by the authenticating notary by application to Mainz Municipal Court on the date hereof. 
  

	5.	Euroareal Verwaltungsgebäude has concluded a lease with IBM Deutschland GmbH and a Rider No. 1 dated February 22 2004. These are attached as Attachment V.1 and 2 to
the Reference Deed. 

  
 In addition, Euroareal
Verwaltungsgebäude has concluded the following leases or licences: 
  

	 	•	 	Licence with DFMG Deutsche Funkturm GmbH in the version of the Agreement with T-Mobile Deutschland GmbH dated 16.07/23.07.2002 as assumed by DFMG Deutsche Funkturm GmbH, Frankfurt
am Main, which is attached as Attachment V 5 to the Reference Deed. 

  

	 	•	 	Lease with O2 (Deutschland) GmbH & Co. oHG dated 24.11.2004 attached as Attachment V.6 plus rider V.7 to the Reference Document. 

  
 The agreements referred to in this Section I Clause 5 are also referred to hereinafter
uniformly as the “Leases.” 

	6.	Euroareal Verwaltungsgebäude has additionally concluded a contract with Stadtwerke Mainz AG the purchase of technical facilities, the production and supply of heating and
cooling and the purchase and operational management of the water supply and waste water network and the power supply network as well as a subsequent contract K000229. These are attached as Attachment III. 1 and 2 in their version dated 08.07.2004
and 20. 08/31.08.2004 to the Reference Document. 

  

	7.	The loan by Debeka Bausparkasse Aktiengesellschaft that is secured by the subject of purchase has been fully paid off according to the Seller and has been replaced by funding by
CSFB the details of which can be seen in Attachment VIII of the Reference Document. 

  
 § 2 
 Funding proviso/sale of shares 
  

	1.	Both Purchaser 2a) and Purchaser 2b) (only jointly) reserve the right, which can be exercised until no later than 19 October 2005, to withdraw from this Purchase
Contract by unilateral written notification to the Seller provided there has not by that date been any reorganisation, as sought by Buyer 2a) and Buyer 2b), of the existing funding of the companies by CSFB. Buyers 2a) and
2b) shall decide on the type and content of said reorganisation at their own discretion; they are merely obliged to allow CSFB to give the Seller information at any time on the status of the discussions between Buyers 2a) and
2b) and CSFB. 

  

	2.	The Seller further undertakes to work together with the Buyers to ensure optimal tax-efficiency for the structure of the purchase. 

 In this connection the Seller shall specifically 
  

	a)	collaborate in taking the necessary steps that may be required for a change in status to come into force prior to the transfer date under United States federal income tax laws,
namely sign the Internal Revenue Service form 8832 (Entity Classification Election) allowing Euroareal Verwaltungsgebäude to be considered to be a “partnership for United States federal tax purposes” under US Federal Income Tax Law
even before the transfer date; reference is also made to Section 6 Section 1 q). 

  

	b)	at the request of the Seller do everything necessary to change Euroareal Verwaltungsgebäude’s financial year to the transfer date so that from said date Euroareal
Verwaltungsgebäude can be integrated with the Buyer as one corporate and trade tax entity; in particular the Seller shall obtain the consent of the competent tax office pursuant to § 7 (4) page 3 Corporation Tax Act in conjunction
with R 59 (3) Corporation Tax Rules and shall by 31 October 2005 decide on a corresponding amendment of the Articles of Association of Euroareal Verwaltungsgebäude and notify them for registration in the Commercial Register. The rule
made under Section 5 Section 2 (iv) shall remain unaffected. 

  

	c)	allow an audit company to be appointed by the Buyers to carry out any audits required under the US securities regulations. 

	3.	All assets of Euroareal Verwaltungsgebäude are deemed to be sold with the shares, with the exception of 

  

	 	i)	a damages claim against IBU GmbH & Co. Real Estate KG written down to the reminder value by individual value adjustment to €€1 (this claim is assigned by
Euroareal Verwaltungsgebäude with effect from the effective date of the assignment of the shares to the Seller, see also regarding this the following Section 5 and 6) 

  

	 	ii)	and with the exception of the assets which Euroareal Verwaltungsgebäude has sold to Stadtwerke Mainz AG by Outline Agreement dated 8 July 2004 (Attachment III.1 of the
Reference Document), 

  

	 	iii)	and with the exception of the claims by Euroareal Verwaltungsgebäude for back payment of increased advance payments of operating costs and payment claims by Euroareal
Verwaltungsgebäude against IBM Deutschland GmbH for energy costs saved pursuant to § 5 No. 10 (2) of Lease with IBM Deutschland GmbH in the version of the 1st rider dated 22.2.2005 (Attachment V.1 and 2 of Reference Document) for the period up until the transfer date. 

  

	4.	From its share as specified in Section I Section 1 the Seller sells unencumbered and not subject to any third party rights 

  

	 	•	 	to Buyer 2a) who hereby accepts same a part share in the amount of €22,500 (in words: twenty two thousand five hundred euros), 

  

	 	•	 	to Buyer 2b) who hereby accepts same a part share in the amount of €2,500 (in words: two thousand five hundred euros), together with all associated rights.

	5.	The Seller hereby undertakes upon the first written request of Buyers 2a) and 2b) to divide its aforementioned share in Euroareal Verwaltungsgebäude of
€€25,000 into two shares of €22,500 and €2,500 and in a separate notarial deed to transfer same to the Buyers subject to the condition precedent of payment in full of the preliminary purchase price pursuant to § 4 of
this document. 

  

	6.	The division of the share specified in § 1 Section 1 and the real transfer of the partial shares sold here shall be implemented in a separate deed subject to the
condition precedent of payment in full of the preliminary purchase price pursuant to § 4 of this Deed. 

  

	7.	This Purchase Contract shall be implemented subject to § 5 Section 2 on 1 November 2005. 

  
 § 3 
 Transfer date/right to receive dividends 
  

	1.	The transfer date governed by the law of obligations (“Transfer Date”) is the end of the month following payment in full of the preliminary purchase price pursuant
to § 5 Section 1. 

  

	2.	The Seller has the right to receive dividends for the current financial year until the Transfer Date. 

	3.	With effect from the date on which the shares are effectively assigned Euroareal Verwaltungsgebäude assigns to the Seller who hereby accepts same, its claims against IBM
Deutschland GmbH for back pay of assessable incidental costs and back payment of energy costs saved pursuant to § 2 Section 3 (iii) that can be defined up until the Transfer Date. At the same time and with effect from the same date
the Seller undertakes to indemnify Euroareal Verwaltungsgebäude against any reimbursement claims by IBM Deutschland GmbH for any overpayment of incidental costs until the aforementioned cut-off date. The statement of incidental costs shall be
drawn up by the Seller as at 30 September 2005 and updated by the Seller until the Transfer Date. 

  
 § 4 
 Purchase Price 
  

	1.	The Purchase Price for the share of €€22,500 is 90% of the total interim and final purchase price still to be determined and is payable by Buyer 2a).

  
 The Purchase Price for the share of
€€2,500 is 10% of the total interim and final purchase price still to be determined and is payable by Buyer 2b). 

 2. The interim total purchase price pursuant to Section 1 is calculated as follows:

  
 €€56,400,000 
  

	 	•	 	Plus bank balances according to the proforma accounts as at 30 September 2005 which are still to be prepared, 

  

	 	•	 	Plus claims up until 30 September 2005 according to the proforma accounts as at 30 September 2005 which are still to be prepared, 

  

	 	•	 	Less any existing liabilities as at 30 September 2005 in each case and less any reserves and deferred income and accrued expenses as at 30 September 2005 according to the
proforma accounts as at 30 September 2005 which are still to be prepared. 

  

	3.	The final total purchase price shall be determined in accordance with the above Clauses 1 and 2. To calculate the final purchase price however the reference date accounts
which are to be prepared specifically in accordance with § 5 Section 6 shall be used instead of the proforma accounts; instead of 30 September 2005 the Transfer Date governed by the law of obligations shall apply
pursuant to § 3 Section 1. The statement of incidental costs as at 30 September 2005 must be drawn up by 30 October 2005. 

  
 § 5 
 Date purchase price payable 
  

	1.	The interim purchase price falls due and payable within 10 (ten) banking days (i.e. business days (except for Saturdays) on which banking institutions in Frankfurt am Main are open
for general business with customers and on which transfers can be made) after fulfilment of the following preconditions for execution pursuant to § 5 Section 2 of this agreement, but no earlier than the last banking day of the month
in which the above agreed period of 10 (ten) banking days has expired. 

 All payments specified – even where not directly to the Seller (see below Section 4 for
this) – shall be made to discharge the debt on the purchase price. If the interim total purchase price is not paid when due the Seller is entitled to withdraw from this Purchase Contract subject more specifically to § 10
Section 1. Any other claims of the Seller shall remain unaffected. 
  

	2.	The precondition for any payments falling due pursuant to § 5 Section 1 and hence at the same time the precondition for execution of this agreement
(“precondition for execution”) is the existence of the following declarations and/or documentation or evidence (to be provided by the Seller): 

  

	 	i)	Cancellation of the prior land charges registered on Sheet 4444 Section III under current nos. 1 and 2 in the Land Register of Mainz Municipal Court for Weisenau and confirmation by
the notary (which cannot be more than five working days old) that apart from the lien in favour of CSFB mentioned in § 1 Section 3 no encumbrances are registered in the Land Register other than those listed in § 1
Section 4 and that the Land Registry has no applications for registration of other encumbrances. 

  

	 	ii)	Deletion of prohibition against execution under cartel law pursuant to § 41 Act against Restraints of Competition. 

  

	 	iii)	Preparation of a rider to this share Purchase Contract with the division and transfer (assignment) of the shares sold here to Buyers 2a) and 2b) (subject to the
condition precedent of payment of the interim purchase price); 

	 	iv)	Presence of certified photocopies of an amendment of the Articles of Association of Euroareal Verwaltungsgebäude in terms of which its financial year 2005 ends on
31 October 2005 and the Profit Transfer and Control Agreement dated 15 November 2004 is cancelled with effect from (no later than) 31 October 2005 and the presence of an extract from the Commercial Register for Euroareal
Verwaltungsgebäude showing the amendment of the Articles of Association and the cancellation of the Profit Transfer and Control Agreement with effect from no later than 31 October 2005; and 

  

	 	v)	Presence of preconditions for payment falling due as specified in § 5 Section 2 (i) to (iv) of the Purchase Contract for all shares in Euroareal Mainz
Produktionsgebäude Hechtsheimer Strasse GmbH (Attachment 2 to the Outline Agreement of notary Wolfgang Gruntkowski). 

  

	3.	It is the responsibility of the notary to determine and notify the aforementioned precondition for payment falling due in § 5 Section 2 (i); in addition, the
Parties are mutually obliged to immediately effect the other preconditions for execution governed by § 5 Section 2. The Buyers are entitled (but not obliged) to waive any or all of the aforementioned conditions, even partially,
solely by making a written declaration to the notary. If these preconditions are not met by 30 November 2005 at the latest the Purchasers are entitled pursuant to § 10 Section 2 to withdraw from this Purchase Contract.

	4.	The Seller hereby irrevocably instructs the Buyers to settle the balance between the interim purchase price and by charging to the purchase price the 

  

	 	a)	balances owed by the Seller to Euroareal Verwaltungsgebäude including any interest and incidental costs, and 

  

	 	b)	the claim by Debeka Bausparkasse AG in the amount of €€3,627,889.78 (in words: three million six hundred and twenty seven thousand eight hundred and eighty nine euros and
seventy eight cents). 

  
 The remaining amount is
payable to an account of the Seller with Commerzbank Bank AG, Bad Homburg (sort code 500 400 00) the number of which is still to be provided. 
  

	5.	The question of whether payment is received at the proper time shall be determined by the date of receipt by the entitled recipient. The Purchasers shall automatically be in default
if they fail to pay on the due date. In this case late interest of 8% above the base rate per annum shall be payable. 

  

	6.	The interim purchase price is calculated based on the proforma accounts to be prepared as at 30 September 2005. 

  
 The Seller shall ensure that within 20 (twenty) calendar days after payment
of the interim purchase price accounts and a reference date balance sheet are prepared as at the Transfer Date (hereinafter also referred to as “reference date accounts”). These must be prepared under the regulations of the Commercial
Register in accordance with the principles of proper accounting and reporting while ensuring reporting and valuation continuity and shall be for the purpose of ascertaining the purchase price. In this regard the interim purchase price as agreed in
§ 4 shall only be adjusted in the context arising from the rules contained therein, i.e. in the event of changes in the following items: “bank balances,” “claims” and “liabilities, reserves and deferred income and
accrued expenses.” Only financial assets and assets involved in the company’s business usage– relating solely to the purchase of the site, the development and operation thereof shall be stated as assets; intangible financial assets
and accounting conveniences may not be stated. The reference date balance sheet, as with the proforma accounts, shall not include any liabilities in connection with maintenance/repair and/or renovation. There are no repair and maintenance reserves.
Obligations existing at the Transfer Date to implement future input tax adjustments pursuant to § 15 a VAT Act must be stated as a liability under one total; the same applies to claims arising from an adjustment under to § 15 a VAT Act.
These reference date accounts and balance sheet, which must also be certified with regard to meeting the aforementioned audit requirements as defined in § 317 ff. Commercial Code, are binding on both Parties as the basis for the calculation of
the final purchase price to be made under § 4 Section 1 to 3, if and to the extent that there is no objection to the accounts and reference date balance sheet and audit report as at the Transfer Date. Any objection must be made in
writing within 10 (ten) banking days after the accounts and reference date balance sheet and audit report are remitted and must also be sent to the other party. It must describe the specific grounds and to what extent the accounts and reference date
balance sheet allegedly fail to accord with the rules in this Agreement. Figures must be given for the minimum and maximum amount of the difference claimed in the objection relating to the items concerned and the resulting conclusions for the
company’s shareholders’ equity per the balance sheet. 
  

	6.	[sic] If in the event of objection the Parties are unable to agree within a further ten (10) banking days, counting from receipt by the other party of an objection, on the
amount of the difference, then, on application by one party, the matter will be decided by a neutral auditor to be appointed by both sides jointly. 

 If the Parties cannot agree on a neutral auditor within one week after the application has been filed by
one party to appoint a neutral auditor, either party is entitled to ask the competent chamber of chartered accountants to appoint the neutral auditor. The neutral auditor shall decide the matter as an arbitrator with binding effect on all parties.
The neutral auditor must give all parties an opportunity to state their position before he makes his decision; an oral debate shall take place if requested by one of the parties. The neutral auditor must provide all parties with his decision
together with a written statement of grounds. §§ 91 ff. Code of Civil Procedure shall apply accordingly to the costs of the arbitration proceedings. In his role as arbitrator the neutral auditor shall also decide on the allocation of
costs, which shall be binding on all parties. 
  

	7.	As soon as the Parties have agreed on the final purchase price or this has been finally determined by the neutral auditor, the corresponding balance shall be payable by the
contractual party with the obligation to make payment to the other party in each case. 

  
 § 6 
 Seller’s warranties and conditions as per contract

  

	1.	Seller’s warranties 

  
 The Seller issues warranties to the Buyers in the form of a separate warranty as to the following facts: 
  

	 	a)	 The information in § 1 of this deed is correct. The shares sold are not pledged or attached 

	 	 
or otherwise encumbered by third party rights (including obligations to vote in a certain way, voting rights or rights to dividends) or by restrictions on
sale or disposal of any kind. The Seller and Euroareal Verwaltungsgebäude are limited liability companies duly established under German law, Euroareal Verwaltungsgebäude having nominal capital of €€25,000. The Seller is the sole
shareholder of Euroareal Verwaltungsgebäude. The information in the extract of the Commercial Register relating to the Seller and to Euroareal Verwaltungsgebäude corresponds to the actual facts. The Seller is fully entitled to conclude and
implement this Agreement and to dispose of the shares and no other duties under the shareholders’ agreement or other contractual duties binding the Seller or Euroareal Verwaltungsgebäude are breached as a result. There are no other third
party pre-emption or acquisition rights with respect to the shares. 

  

	 	b)	All capital contributions to the shares have been paid up in full and have not been repaid either in whole or in part; nor is there a duty to make subsequent payment.

  

	 	c)	No resolutions have been passed concerning Euroareal Verwaltungsgebäude on the appropriation of profits relating to the period following the Transfer Date and there has been no
payment or promise to make payment of advance distributions of profits that shall not arise until after the Transfer Date. 

  

	 	d)	 There are no affiliation agreements of any kind with Euroareal Verwaltungsgebäude and its associated companies or relating to their shares, 

	 	 
in particular not in the sense of §§ 291, 292 Stock Corporation Act; no resolutions to transform the company have been adopted nor any other
transforming measures taken, in particular pursuant to the rules in the Transformation of Companies Act nor are there any silent partnership agreements, sub-participations, loans with profit participation or similar agreements or options or similar
rights thereto. Nor is Euroareal Verwaltungsgebäude consolidated as part of an actual group. 

  
 The Buyers do, however, know that the Seller, Euroareal Beteiligungs GmbH and their associated companies and Euroareal Verwaltungsgebäude are one VAT
filing entity. Neither the Seller nor Euroareal Beteiligungs GmbH and their associated companies nor Euroareal Verwaltungsgebäude, however, have any VAT arrears. 
  

	 	e)	The shares sold represent the entire nominal capital of Euroareal Verwaltungsgebäude, the Seller is sole shareholder of Euroareal Verwaltungsgebäude, there are no third
party claims on any basis to acquire shares. 

  

	 	f)	No insolvency proceedings have been commenced either on the assets of Euroareal Verwaltungsgebäude or on the assets of the Seller. There has been no application to commence
such proceedings nor shall the same be commenced under law nor is the same otherwise imminent. Neither the Seller nor Euroareal Verwaltungsgebäude are insolvent or over-encumbered by debt. 

	 	g)	The shareholders’ agreement corresponds with the deed of incorporation dated 18 March 2004, which is attached as Attachment VI.1 to the Reference Document. There are no
further agreements or resolutions pursuant to the shareholders’ agreement. 

  

	 	h)	Euroareal Verwaltungsgebäude is the owner of the subject of purchase more particularly described in § 1 Section 3 including all buildings thereon, which will
be encumbered only by the land charges shown in § 1 Section 4; it is moreover also absolute owner of all other assets including all claims, bank balances and liquid assets which 

  
 i) are stated in the annual accounts or in the proforma accounts to
be prepared as at 30 September 2005, 
  
 ii) it has
acquired after 30 September 2005 or which 
  
 iii) it
requires to meet its contractual duties. 
  
 There are no third
party rights hereto. Acquisitions and disposals of assets have only been made in the due course of business. Title to the subject of purchase including all buildings thereon and the technical facilities and equipment is available to an extent that
enables Euroareal Verwaltungsgebäude to meet all lease obligations arising from the lease agreements attached as Attachment IV to the Reference Document. 
  

	 	i)	 Euroareal Verwaltungsgebäude has no holdings in any other companies, in particular it has no company or participation rights of any kind in any other
companies, 

	 	 
be they partnerships, limited liability companies or trading companies, nor is it bound by any corresponding shareholders’ agreements.

  

	 	j)	Euroareal Verwaltungsgebäude has of now only those existing or imminent liabilities that are shown in the balance sheet of Euroareal Verwaltungsgebäude attached as
Attachment VI. 2 and 3 to the Reference Document as at 31.12.2004 or in the proforma accounts to be prepared. All claims shown in the proforma accounts to be prepared or in the accounts and reference date balance sheet at the Transfer
Date are valued (collectible) at the stated amount. 

  

	 	k)	The annual accounts of Euroareal Verwaltungsgebäude as at 31 December 2004 and the proforma accounts to be prepared are in accordance with the regulations of the
Commercial Code and the principles of proper accounting and reporting ensuring the continuity of the reporting and valuation, the accounts are complete and accurate and they are a true reflection of the assets and income position of Euroareal
Verwaltungsgebäude; nor is there any reason to fear a downturn in the asset and income position. All reserves, value adjustments and similar items in the balance sheets of the accounts that decrease assets or increase liabilities (with the
exception of building-related repair and maintenance reserves or reserves for subsequent payments of operating costs) have been accurately and fully determined and stated. 

	 	l)	Euroareal Verwaltungsgebäude has paid or retained and paid over in accordance with its statutory obligations all taxes and duties and, where not paid or paid over, has made
reserves in the balance sheet of the annual accounts, the proforma accounts and in the reference date accounts for future taxes and duties thus reducing its equity. In addition, it has made and submitted all necessary declarations to the tax
and other authorities at the proper time, completely and truthfully. There are no tax assessments relating to Euroareal Verwaltungsgebäude that have not been settled. 

  

	 	m)	Euroareal Verwaltungsgebäude has not made any public or covert profit distributions. All payment relationships with associated companies bear comparison with third party
relationships and otherwise too meet all preconditions under tax law for acceptance. 

  

	 	n)	The refinancing undertaken in 2004 and 2005 (Debeka and CSFB) of the land and buildings owned by Euroareal Verwaltungsgebäude result in no tax liabilities, in particular no tax
liabilities based on hidden profit distributions. 

  

	 	o)	The invoicing by or to third parties, including for rent under leases, must be done to or by Euroareal Verwaltungsgebäude so as to comply with the statutory regulations of the
VAT Act and in particular so as to ensure that the respective input tax deduction was made at the date asserted or used in each case in accordance with the statutory regulations. 

	 	p)	Within the context of letting real estate, particularly to IBM Deutschland, Euroareal Verwaltungsgebäude has elected a valid option under VAT law enabling it to treat the VAT
shown in the invoices in which it is designated as recipient of the corresponding supplies or other services in the full amount as input tax that can be reimbursed or offset. 

  

	 	q)	 Euroareal Verwaltungsgebäude has not applied for a change in status as defined in the US Federal Income Tax Acts, i.e. it has not applied pursuant to Treasury
Regulation Section 301-7701-3 (c) on Internal Revenue Service Form 8832 (Entity Classification Election); the current assessment of Euroareal Verwaltungsgebäude as defined in the US Federal Income Tax Acts is the one under Treasury
Regulations Section 301-7701-3 (b) (2). The company has no assets (nor did it in the past) other than the subject of purchase with the buildings thereon, the associated moveable assets (fixtures and fittings), cash in hand, bank balances
and claims such as claims to rental payment, arising from the current lease business; the company has no (nor did it in the past have any) shares, loans, debentures or other participation certificates nor has the company paid any advances to an
issuer of securities (including those of associated companies or tenants); nor is or was the company party to a lease for moveable assets, except for leases 

	 	 
affecting movables and property assets jointly and where less than 10% of the total rent is attributable to the movables (calculated according to the average
market value of the movables at the start and end of the financial year compared to the average market value of the subject of purchase including the movables at the start and end of each financial year); and Euroareal Verwaltungsgebäude now no
longer makes more than USD 20,000 income in a calendar year from sources other than rent and interest on bank balances. 

  

	 	r)	Euroareal Verwaltungsgebäude has not entered into any employment relationships, including with its managing directors. 

  

	 	s)	Only liabilities of Euroareal Verwaltungsgebäude i.e. not those of third parties, even if they are unaffiliated companies, are secured by the encumbrances specified in
§ 1 Section 4 and § 5 Section 2 (i). 

  

	 	t)	Euroareal Verwaltungsgebäude has definitively and fully implemented all obligations under the loan granted by Debeka Bausparkasse AG. There are no further obligations on
Euroareal Verwaltungsgebäude under or in connection with loan agreements, including in relation to the Seller. In addition, Euroareal Verwaltungsgebäude has also implemented all obligations under the loan agreement with CSFB by the
Transfer Date. 

	 	u)	The subject of purchase is unencumbered by building liens, easements that have not been registered in the Land Register and restrictions under neighbouring property law with the
exception of such charges contained in § 1 Section 4 in conjunction with Appendices I. 6 and I. 11 to the Reference Document. 

  

	 	v)	There is no asbestos in the building on the subject of purchase that requires immediate removal in accordance with the relevant governmental regulations. 

 

	 	w)	The plan for voluntary decontamination of the soil air attached as Attachment IX to the Reference Document shall be implemented by 30.06.2006. 

  

	2.	Conditions as per contract 

  
 The Seller further warrants under his statutory or contractual warranty and liability obligation with regard to the agreed condition that the following
information is correct as of the date hereof and will be so on the Transfer Date: 
  

	 	a)	As at the Transfer Date all local development assessments under §§ 123 ff Town and Country Planning Code and any other assessments and duties due under the local rates law
and under the corresponding bylaws, as well as any claims for reimbursement of costs, discharge or settlement amounts and other charges due for the currently existing development of the subject of purchase for the uses intended by this Purchase
Contract have been paid in full. The same applies to the connection to the water and waste water supply and power supply. 

	 	b)	All the buildings on the subject of purchase have all the necessary building and use permits, including evidence of parking places1 and all other administrative permits, which are unconditional and for an unlimited duration and all conditions set in the permits granted have been fulfilled.
The same applies to the provisions/conditions and corresponding official requirements currently applicable under fire prevention law. 

  

	 	c)	Euroareal Verwaltungsgebäude has and had in the past insurance cover by which it is bound as stipulated, it was and is, in addition, insured in the amount stated in Attachment
II of the Reference Document against risks for which this kind of company is usually insured when exercising the care of an ordinary businessman. 

  

	 	d)	Euroareal Verwaltungsgebäude is not in arrears with any premium payment and there are no circumstances suggesting that the insurance cover does not exist. Copies of the
corresponding insurance policies are attached as Attachment II. 3 and 4 of the Reference Document. Euroareal Verwaltungsgebäude has not filed any insurance claims or requested any cover notes. 

	1	Partially provided for the property of Euroareal Produktionsgebäude. 

	 	e)	Euroareal Verwaltungsgebäude is not bound by any agreements with the exception of the agreements specified in § 1 and attached as copies as an Attachment in the
version specified there and with the content shown in the Reference Document and also with the exception of the usual agreements made to properly manage property; this applies specifically to: 

  

	 	i)	Agreements with the Seller, with Seller-associated companies or with dependents as defined in § 15 Tax Code, 

  

	 	ii)	Lease and tenancy agreements for real property; 

  

	 	iii)	Employment and service agreements of any kind with the exception of managing directors’ contracts, the latter however being without any obligation to pay a fee or redundancy
payment; 

  

	 	iv)	Pension commitments and profit-sharing commitments; 

  

	 	v)	Collective agreements and works’ council agreements; 

  

	 	vi)	Loan agreements; 

  

	 	vii)	Commercial agent agreements and sales agreements and other distributorship agreements. 

  

	 	f)	The agreements attached in the Reference Document are attached in full and there are no amendments, additions or ancillary agreements. 

  

	 	g)	The agreements concluded by Euroareal Verwaltungsgebäude are not as of now terminated. Nor are there any terminations by the party currently pending with regard to these
agreements nor are there any circumstances or grounds justifying such termination. There are no defaults with regard to these agreements. 

	 	h)	All lease agreements of Euroareal Verwaltungsgebäude (Attachment V to Reference Document) meet the formal requirements in §§ 550, 126 Civil Code.

  

	 	i)	There are no preliminary orders concerning rental claims and no development cost subsidies repayable by the landlord and/or other repayable advances by tenants.

  

	 	j)	There are no ancillary agreements with tenants, neighbours or authorities that are not included in the Appendices to the Reference Document. 

  

	 	k)	Euroareal Verwaltungsgebäude and/or the Seller or a company associated with the latter two companies have not concluded any agreements which in the event of a change in
shareholders at Euroareal Verwaltungsgebäude would result in any legal consequence that would negatively impact Euroareal Verwaltungsgebäude. 

  

	 	l)	Euroareal Verwaltungsgebäude is not subject to any particular restrictions on competition under civil or public law. 

  

	 	m)	Euroareal Verwaltungsgebäude has an undisputed permanent right to use any copyrighted plans, reports and computer software that are necessary and actually used in connection
with maintaining and operating the buildings. 

	 	n)	Neither the Seller nor Euroareal Verwaltungsgebäude are involved in proceedings before state courts, arbitration courts or other authorities or administrative institutions. Nor
are such proceedings imminent against the Seller or Euroareal Verwaltungsgebäude. 

  

	 	o)	The Seller is liable to the Purchasers for damages, losses and costs which have arisen to date or which may still arise from the current condition due to the presence of
environmental pollution in the ground water, property and/or buildings thereon, for which the Purchaser or Euroareal Verwaltungsgebäude may be sued. The liability shall include civil and public law obligations or claims of third parties. To the
extent that statements and rules have been made in the Purchase Contracts (Attachment IV to the Reference Document) concerning environmental pollution previously found, the liability of the Seller shall be limited in that currently no measures are
required to ensure at present uninterrupted use (without imminent rent abatement also) of the subject of purchase and the buildings thereon as well as structural installations by the owner and the tenants. 

  

	 	p)	The Seller has no right of recourse, in particular based on or in connection with § 24 (2) Federal Soil Protection Act, against Euroareal Verwaltungsgebäude or the
Buyers, and the Seller to this extent waives its right to go against the Buyers and Euroareal Verwaltungsgebäude based on or in connection with environmental pollution. 

	3.	Other agreements 

  
 Seller and buyer further agree as follows: 
  

	 	a)	To the extent that claims against the seller from provisions for the protection of the capital stock of Euroareal Verwaltungsgebäude exist, the seller also accepts the
obligation to fulfil these claims, even in the context of this purchase contract. 

  

	 	b)	The seller is obligated to make up for a deficit not covered by shareholders’ equity as shown on the financial statement on the day of valuation, to the extent that such a
deficit exists. In this respect, to the extent that the seller had already made payments to Euroareal Verwaltungsgebäude prior to the effective date of the transfer, which lead to an increase in the bank balance shown in the financial
statements on the day of valuation, this bank balance is not to be considered an increase in the purchase price according to § 4 number 2 and number 3 upon the calculation of the final purchase price. 

  

	 	c)	In the case of a corresponding request by the buyer, the seller will declare his approval that the technical Due Diligence Report that he commissioned in the context of the
financing through CSFB will be “addressed” to the buyer as well, such that the buyer can also make claims against the author of the report as a result, if necessary. In the case of such a request, the buyers are obligated to bear 50% of
the transfer costs resulting from the creation of the respective report to which the buyer’s request relates. 

  
 § 7 

Specific liability of the seller and of Euroareal Beteiligungs GmbH 
  

	3.	Indemnity 

  
 The seller indemnifies the buyer and Euroareal Verwaltungsgebäude against all claims by third parties, and correspondingly for future circumstances, in the follow cases: 
  

	 	a)	Upon first request, the seller releases Euroareal Verwaltungsgebäude from all debts that it might be subject to on the basis of joint and several liability for debts of the
seller and of the companies associated with it. This applies particularly for joint and several liabilities or joint liabilities of Euroareal Verwaltungsgebäude with the seller from or in connection with the agreement with IBM Deutschland GmbH
of 21/24 May 2005 (Attachment version 4 of the reference documents). 

  

	 	b)	The seller releases Euroareal Verwaltungsgebäude and the buyer from all tax claims based on the existence of and/or completion of the profit and loss transfer agreement
mentioned in § 5 Section 2 (iv), prior to the effective date of the transfer, and will compensate them for all existing or resulting losses, insofar and to the extent that sufficient unrestricted reserves have not be provided for
this purpose. 

  

	 	c)	 The seller releases Euroareal Verwaltungsgebäude [Euroareal Administrative Buildings] and the buyer from all payment obligations with respect to 

	 	 
taxes and duties for transaction up until the effective date of the transfer, to the extent that the balance sheet on the day of valuation includes no
corresponding reserves, or corresponding reserves in an insufficient amount. The seller is obligated to release Euroareal Verwaltungsgebäude and the buyer from all payment obligations, and to compensate for other disadvantages that result if
the independent guarantee promises included in § 6 Section 1 (d), (l), (m) and (n) are not applicable. § 8 Section 1 remains unaffected. 

  

	2.	Security of Euroareal Beteiligungs GmbH and of CPB Cooperative für Planen und Bauen GmbH 

  
 By executing this purchase contract, Euroareal Beteiligungs GmbH and CPB Cooperative für Planen und Bauen GmbH each
stand as an absolute surety for all of the seller’s obligations from this purchase contract. Claims by the buyer against these securities are time-barred after the expiration of five years, calculated from the expiration of the effective date
of the transfer. 
  
 § 8 
 Liability of the seller 
  

	1.	Guarantees 

  
 With respect to the guarantees provided in § 6 Section 1, the legal provisions apply. 

	2.	Quality stipulations and indemnification obligations 

  
 If one of the seller’s quality stipulations provided in § 6 Section 2 is incorrect in whole or in part, at the buyer’s election
the seller is required 
  

	 	i)	to pay cash compensation for damages to the buyers, or 

  

	 	ii)	to establish a situation that corresponds to the stipulated quality for Euroareal Verwaltungsgebäude, 

  

	 	iii)	to indemnify the buyer, 

  

	 	iv)	to pay cash compensation for damages to Euroareal Verwaltungsgebäude , or 

  

	 	v)	to indemnify Euroareal Verwaltungsgebäude. 

  
 § 9 
 Limitation period

  

	1.	Limitation period for guarantee claims 

  
 Claims due to the failure to fulfil of guarantees provided in § 6 Section 1 are time-barred after 10 (ten) years. 
  

	2.	Limitation period for claims for quality stipulations 

  
 The buyer’s claims due to failure to fulfil quality stipulations provided in § 6 Section 2 are time-barred after five years.

  

	3.	Limitation period for claims on account of taxes 

  
 The buyer’s claims on account of taxes or duties are time-barred six months after the point in time at which the corresponding taxes or duties or
required amounts 

 
have been finally and materially established in a manner not subject to modification with respect to Euroareal Verwaltungsgebäude, but at the earliest
after five years. Section 1 remains unaffected. 
  

	4.	Limitation period for indemnification claims 

  
 The buyer’s indemnification claims are time-barred after five years. However, longer limitation periods due to failure to fulfil with respect to
guarantees or due to tax risks remain unaffected. 
  

	5.	Start of the limitation periods 

  
 The limitation periods mentioned above start upon the expiration of the effective date of transfer. 
  
 § 10 
 Rights of withdrawal 
  

	1.	Right of withdrawal of the seller 

  
 The seller is entitled to withdraw from this purchase contract if the buyer is delinquent more than ten bank working days in the payment of the
preliminary purchase price, and if an extension of time provided to the buyer from the seller under threat of withdrawal in writing (by courier and - according to the requirements of Section 3 - by fax) of at least an additional ten bank
working days passes without success. 

	2.	Right of withdrawal of the buyer 

  
 The buyers (only collectively) are entitled to withdraw from this purchase contract by means of written declaration (by courier and by fax) to the extent
that the due-date implementation requirements according to § 5 Section 2 (i) to (iv) of this contract or the due-date implementation requirements according to § 5 Section 2 (i) to (iv) of the
contract executed today regarding Euroareal Mainz Produktionsgebäude Hechtsheimer Strasse GmbH are not completely fulfilled by 20 November 2005. In addition, the buyers (only collectively) are entitled to withdraw from this purchase
contract by means of written declaration insofar as they are simultaneously withdrawn (in a manner in which they are entitled) from the contract executed today regarding the Euroareal Mainz Produktionsgebäude Hechtsheimer Strasse GmbH within
the context of compensation for damages to be paid to the buyers. The buyer’s additional legal rights of withdrawal, namely due to the seller’s failure to comply with respect to guarantees, remain unaffected. 
  

	3.	Exercise of a right of withdrawal 

  
 The right to withdraw is to be exercised by means of written declaration (by courier and by fax) to the other party in each case, to the attention of the
notary public that the parties to the contract hereby irrevocably authorize both to receive the declarations regarding the threat to exercise the right to withdraw as well as to receive of the declaration of withdrawal. The declaration of withdrawal
is (initially) valid upon the notary republic’s receipt of the declaration delivered by courier. The faxed notices merely serve as information in advance for the parties; neither their receipt nor their absence is of importance for the 

 
effectiveness of a threat of withdrawal nor for the exercise of a right of withdrawal. The notary public is required to inform the other party in each case
regarding the threat and the exercise of a right of withdrawal; the failure to provide this information does not affect the validity of the delivered declarations. The rights of withdrawal of the parties to the contract expire if the respective
right of withdrawal has not been exercised within two months after information is obtained regarding the grounds for withdrawal. 
  
 § 11 
 Other obligations of
the parties 
  

	3.	Obligations of the seller 

  

	 	a)	The seller will be responsible for seeing that Euroareal Verwaltungsgebäude [Euroareal Administrative Buildings] will carry out its transactions only in the customary line of
business after the date of the acceptance of this document until the assignment of the company shares is effective. However, investment procedures require the buyers’ assent that they are not entitled to refuse for unrealistic reasons. Changes
to existing rental contracts and/or the execution of new rental contracts require the buyers’ consent, which are entitled to make a decision based on their own discretion. 

  

	 	b)	 After the day of acceptance of this document until the assignment of the company shares is effective, the seller is obligated to finalize no withdrawals, profit
participation rights or other financial transactions that encumber Euroareal Verwaltungsgebäude, to put no corresponding resolutions into effect, and to not demand their implementation after the 

 
point in time mentioned above or to carry out other actions with a similar effect, insofar as the actions mentioned relate to profits that arise after the
effective date of the transfer. 
  

	2.	Obligations of the buyers 

  
 The buyers are obligated to cause the Euroareal management to assign its claims to compensation for damages of any sort against IBU GmbH & Co. Real Estate KG
(compare Attachment 3 of the annual financial statement, Attachment VI. 2 of the reference document) when the assignment of the company shares to the seller takes effect. The liability of Euroareal Verwaltungsgebäude for the valuation and
existence of the claim is barred, and the seller hereby waives all claims of this type against Euroareal Verwaltungsgebäude, presuming this waiver. The same correspondingly applies for the claims controlled by § 2 Section 3
(III) and § 3 Section 3 to additional payment for increased prepayments for operating costs and payment claims of IBM Deutschland GmbH for savings of energy costs for the period of time until the effective date of the transfer.

  
 § 12 
 Severability clause 
  
 If a provision of this contract is or becomes invalid or cannot be carried out, the validity of the contract apart from that is hereby not affected. On the contrary, the
parties to the contract are obligated to replace the provision that is invalid or cannot be carried out with a provision that is valid and that can be carried out that corresponds as closely as possible with the spirit and the purpose of the
provision to be replaced. The same applies for an omission in the contract. 

  
 § 13 

Final provisions 
  

	1.	Together with the purchase contract regarding all company shares of Euroareal Mainz Produktionsgebäude Hechtsheimer Strasse GmbH, this purchase contract is registered in a
framework document. The expenses resulting from the registration are assigned to both of the purchase contracts based on the proportion of the respective amounts mentioned in § 4 Section 2 ( 1). The buyers bear the expenses that
result after the registration of this purchase contract, as well as the expenses for the supplementary documents mentioned in § 2 Section 1, in proportion to their purchase share. The seller bears all expenses for the release of
encumbrances, including the release of encumbrances for the real estate purchased according to the provision of this contract. Apart from that, to the extent that nothing is otherwise contractually stipulated, each party to the contract bears his
own existing and arising expenses and taxes. The notary public advised the parties regarding the real estate acquisition tax problem. 

  

	2.	To the extent that notarial certification is not required, changes and supplements to this contract must be in writing. 

  
 § 14 
 Law, court of jurisdiction 
  

	1.	This contract is subject to German law, even if the German principles for conflict of laws refer to another legal system. However, the United Nations Convention on Contracts for the
International Sale of Goods does not apply. 

	2.	The court of jurisdiction for all disputes from this contract and its implementation is Mainz. This also applies for claims for the security controlled in § 7
Section 2. 

  
 § 15 

Other and explanations 
  

	1.	The buyers will notify Euroareal Verwaltungsgebäude regarding the shareholder exchange according to § 16 of the GmbHG [Limited Liability Company Law].

  

	2.	In addition, the notary public is required to make reference to the liability provisions of the GmbH law [Limited Liability Company Law], and in particular to explain that the
purchaser of a company share is liable without limitation for deposits of money not made and the deficits for inadequate investments in kind by the seller and all other shareholders, and likewise for the reimbursement of any prohibited redemption
payments from the capital stock and any real property tax obligation. 

  

	3.	It is made known to the investors that a good-faith acquisition of company shares is not possible. The investment circumstances reported, which are based on the information from the
investors, can be audited only to a limited extent by the notary public. 

  

	4.	The shareholders’ approval for the preceding agreement regarding the division and assignment of company shares is granted below. 

  

	5.	All approvals should become effective upon their receipt by the recording notary public. 

  

	6.	The investors confirm that the recording notary public provided no tax advice. 

  
 § 16 

Approvals and assumptions of liability, Shareholders’ Meetings 
  
 In their capacity as chief executives with joint authority to sign for Euroareal Verwaltungsgebäude and for the seller, Mr. Fritz
Eduard Skrzypczak and Mr. Rolf Breuer hereby grant their approval to this document and in particular to the division and assignment stipulated in § 2 Sections 3 to 5 of this memorandum. In addition, the seller irrevocably waives any
pre-emption rights, purchase rights, option rights or similar rights, to which he is entitled according to the law, the articles of association or other. 
  
 The sole shareholder of Euroareal Verwaltungsgebäude, represented by Mr. Fritz Eduard Skrzypczak and Mr. Rolf Breuer, then convenes a shareholders’
meeting for Euroareal Verwaltungsgebäude and then, waiving compliance with all formalities and requirements of notice and periods allotted for service upon the parties in the sense of a plenary meeting, passes a resolution as follows:

  
 “The specified division and sale and
assignment of company shares that has yet to take place to Euroareal Mainz Produktionsgebäude Hechtsheimer Strasse GmbH to the buyer mentioned above is hereby irrevocably approved. In addition, the shareholder irrevocably waives any pre-emption
rights, purchase rights or similar rights, to which he is entitled according to the law, the articles of association or other. Additional resolutions are not provided today.” 

  
 § 17 

Translation 
  
 The possible English version of this document serves merely for linguistic understanding. Only the German version is binding. In the case of any deviations or
contradictions between the German version and the English version, the German version has priority. 
  
 Accepted as an attachment to the document of the notary public Wolfgang Gruntkowski in Cologne on the present day, document number 1577 for 2005. 
  
 Cologne on the 22 September 2005 
  
 [signed by several parties] 

 [see original for graphic; terminology glossary appears below] 
  
 Tor = gate 
  
 “Als Anlage zur Urkunde vom heutigen Tage – UR Nr. 1577 / 2005 des Notars Wolfgang
Gruntkowski in Köln. Köln den 22.09.2005.” = “As an attachment to the document of the notary public Wolfgang Gruntkowski in Cologne on the present day, document number 1577 / 2005. Cologne on the 22 September 2005.”

  
 Planinhalt = plan contents 
  
 Massstab = scale 
  
 Datum = date 
  
 Gezeichnet = signed 
  
 Lageplan = site plan 
  
 Nutzung- / Wege- /Zugangsrecht = right of use / passage /
entry 
  
 Dienstbarkeit für die Kantine =
easement for the cafeteria 
  
 Parkplätze von IBM [illegible] mit
kurzfristiges Kündigungsrecht = parking places for IBM [illegible] with short-term right of cancellation 
  
 Parkplätze von IBM, Bestandteil des [illegible] = parking places for IBM, part of the [illegible] 
  
 Dienstbarkeit für Geb. 12 [illegible] = easement for
building 12 [illegible] 
  
 Dienstbarkeit
für Geb. 20/82 = easement for building 20/82 
  
 IBM Verwaltung = IBM management 

  
 PROJECT MAINZ,

  
 Hechtsheimer Strasse 
  
 Production Buildings 
  
 PURCHASE CONTRACT 
  
 between 
  

	1.	the company with limited liability registered in the commercial register of the Cologne local court under Commercial Register [HR]B 52583 under the company name Euroareal Holding
Project Mainz Hechtsheimerstrasse GmbH, with headquarters in Cologne and the business address of Jülicher Strasse 26 in 50674 Cologne, 

  

	 	•	 	the company Euroareal Holding Project Mainz Hechtsheimerstrasssse GmbH referred to herein as “seller” -

  

	2.	

  

	a)	the company with limited liability registered in the commercial register of the Hamburg local court under Commercial Register [HR]B 93 395 under the company name Digital Realty
Trust Germany 1 GmbH (previously Einhundertdreiundsechzigste Verwaltungsgesellschaft Dammtor mbH, with headquarters in Hamburg and the business address of Warburgstrasse 50 (c/o Latham & Watkins LLP), 20354 Hamburg,

  

	b)	the limited partnership founded today under the name LBC-Digital Realty Trust Germany 1 GmbH & Co. KG with headquarters in Hamburg and the business address of
Warburgstrasse 50 (c/o Latham & Watkins LLP), 20354 Hamburg, 

	 	•	 	Digital Realty Trust Germany 1 GmbH (previously Einhundertdreiundsechzigste Verwaltungsgesellschaft Dammtor mbH, and Digital Realty Trust Germany 1 GmbH & Co.
KG are referred to herein as “buyers for 2a) and 2b)” 

  
 with the participation of the 
  

	3.	company with limited liability registered in the commercial register of the Cologne local court under Commercial Register [HR]B 42719 under the company name EuroAreal Beteiligungs
GmbH with headquarters in Frechen and the business address of Kölner Strasse 9, 50226 Frechen, 

  

	4.	company with limited liability registered in the commercial register of the Bad Homburg v.d. Höhe local court under Commercial Register [HR]B 5852 under the company name
Cooperative für Planen und Bauen GmbH with headquarters in Bad Homburg v.d. Höhe and the business address of Louisenstrasse 119-121 in 61348 Bad Homburg v.d. Höhe, 

  

	5.	company with limited liability registered in the commercial register of the Cologne local court under Commercial Register [HR]B 52649 under the company name Euroareal Mainz
Verwaltungsgebäude Hechtsheimerstrasse GmbH with headquarters in Cologne and the business address of Jülicher Strasse 26 in 50674 Cologne, 

  

	6.	company with limited liability registered in the commercial register of the Cologne local court under Commercial Register [HR]B 52656 under the company name Euroareal Mainz
Produktionsgebäude Hechtsheimerstrasse GmbH with headquarters in Cologne and the business address of Jülicher Strasse 26 in 50674 Cologne, 

  
 § 1 

Purpose of the contract 
  

	1.	With a company share of the face value of €€25,000, the seller is the sole shareholder of the company with limited liability registered in the commercial register of the
Cologne local court under Commercial Register B 52656 under the company name Euroareal Mainz Produktionsgebäude Hechtsheimerstrasse GmbH with headquarters in Cologne, whose fully paid-in capital stock amounts to €€25,000.00 (in
words: twenty-five thousand Euros). The company indicated above is referred to herein as “Euroareal Produktionsgebäude”. 

  

	2.	In order to simplify the implementation of this purchase contract, a reference document was created on 22 September 2004, document number 1576 for 2005 of the recording notary
public. This document is also referred to herein as “reference document”. At the time of the recording, the reference document existed as a notarised copy and was delivered to the publications for review. Reference will be made to
the content of the reference document. The parties hereby confirm that the content of the reference document is known to them. 

	3.	Of the property entered in the land register of the Mainz local court, Euroareal Produktionsgebäude is the owner 

  

	 	a)	of parcel 21/4, building and land, Hechtsheimerstrasse, size 4,156 m2, parcel 22/1, agricultural land, Hechtsheimerstrasse 62, size 274 m2, parcel 35/19,
building and land, Hechtsheimerstrasse 2, size 203 m2, parcel 35/21, building and land, Hechtsheimerstrasse 2, size
250,683 m2, from Weisenau, page 4443, recorded real estate of the Weisenau boundary, lot 2,

  

	 	b)	of parcel 145/21, public thoroughfare, Heiligkreuzweg, 9,870 m2, from Hechtsheim page 9881, recorded real estate of the Hechtsheim boundary, lot 6. 

  
 This real estate is developed with buildings 01, 02/03, 04, 05, 06, 07, 08, 11, 14, 15, 16, 17, 51, 64 and 67 shown in the site plan, as well as with
parking spaces. It is also referred to herein as the “purchase real estate” and is bordered in yellow in the plan attached as 
  
 Attachment “site plan” 
  
 for more detailed orientation regarding the location of the purchase real estate from this memorandum. 

	4.	The following encumbrances are recorded in the land register: 

  
 Weisenau page 4443 
  
 Section II: 
  

			
	serial number 3	  	Limited personal easement (water line right, associated with usage limitations) for the City of Mainz (public utilities),
		
	serial number 4	  	Limited personal easement (right to maintain water supply lines and a gas line associated with surge limitations and growth limitations for the City of Mainz (public
utilities),
		
	serial number 5	  	Limited personal easement (right for the installation, the operation and the maintenance of high-pressure gas lines, associated with construction and growth limitations) for Stadtwerke Mainz
Aktiengesellschaft in Mainz,
		
	serial number 8	  	Limited personal easement (supply and waste line right) for Stadtwerke Mainz AG, Mainz.

  
 Section III:

  

			
	serial number 1:	  	€€3,000,000.00 uncertificated mortgage for Debeka Bausparkasse Aktiengesellschaft, Koblenz am Rhein, in addition to 10% yearly interest,
		
	serial number 2:	  	€€11,500,000.00 uncertificated mortgage for Debeka Bausparkasse Aktiengesellschaft, Koblenz am Rhein, in addition to 10% yearly interest,
		
	serial number 3:	  	€€11,000,000.00 mortgage for Credit Suisse First Boston International, London, in addition to 18% yearly interest, in addition to a non-recurring auxiliary fee of
10%,
		
	serial number 4:	  	Priority notice for the security for the claim to registration of a construction lien for M+W Zander D.I.B. Facility Management GmbH, Nürnberg.

 Hechtsheim page 9881 
  
 Section II: 
  

			
	serial number 1:	  	Limited personal easement (power cable transit right) for Stadtwerke Mainz AG, Mainz,
		
	serial number 2:	  	Easement (right of ingress and egress) for the respective owner of the real estate lot 6, number 145/20 (page 3191, volume number 660),
		
	serial number 3:	  	Easement (waste water line right) for the respective owner of the real estate lot 6, number 145/20 (page 3191, volume number 660),
		
	serial number 5:	  	Limited personal easement (right for the installation, operation and maintenance of four 20-kV power cables, five news cables along with accessories and the right to enter for Stadtwerke
Mainz AG, Mainz.

  
 Section III:

  

			
	serial number 1:	  	€€3,000,000.00 uncertificated mortgage for Debeka Bausparkasse Aktiengesellschaft, Koblenz am Rhein, in addition to 10% yearly interest,
		
	serial number 2:	  	€€11,500,000.00 uncertificated mortgage for Debeka Bausparkasse Aktiengesellschaft, Koblenz am Rhein, in addition to 10% yearly interest,
		
	serial number 3:	  	€€11,000,000.00 certificated mortgage for Credit Suisse First Boston International, London, in addition to 18% yearly interest, in addition to a non-recurring auxiliary fee of
10%.

  
 The content of the
land register was determined on 19 September 2005. The discharge of the mortgages in favour of Debeka Bausparkasse Aktiengesellschaft was applied for by the recording notary public with an application today at the Mainz local court. 

 
 The discharge of the priority notice for the security for the claim to
registration of a construction lien will be carried by the seller without delay. 

	5.	Euroareal Produktionsgebäude has executed the rental contracts listed in Attachment V of the reference document. They were accepted as Attachment V to the reference document.

  
 The contracts mentioned in this § 1
Section 5 are referred to herein collectively as “rental contract”. 
  

	6.	In addition, Euroareal Produktionsgebäude executed a contract with Stadtwerke Mainz AG regarding the purchase of technical equipment, the production and the delivery of heating
and cooling, as well as the purchase and the operation of the water and waste-water network and of the electrical supply network, as well as a subsequent contract K000229. These are accepted for the reference document as Attachments III. 1 and 2 in
their version of 8.07.2004, and 20.08/31.08.2004. 

  

	7.	The loan secured by the purchase real estate is completely discharged according to the seller’s assertion. Financing by the CSFB took its place, whose details are provided in
Attachment VIII of the reference document. 

  
 § 2 
 Financing restriction/sale of company shares 
  

	1.	 Both the buyer for 2a) as well as the buyer for 2b) (only collectively) reserve the right, exercisable at the latest by 19 October 2005,
to withdraw from this purchase contract by means of unilateral written declaration to the seller, if the reorganization of the existing financing for the companies by CSFB sought by the buyer for 2a) and the buyer for 2b) is not
effected by then. The buyers for 2a) and for 

	 	 
2b) decide regarding the type and content of this reorganization according to their own discretion; they are obligated merely to permit information
regarding the status of the discussions between the buyers for 2a) and for 2b) and CSFB to be given to the sellers at any time. 

  

	2.	Apart from that, the seller is obligated to work with the buyers in the interest of a purchase structure that is as tax-efficient as possible. In this context, the seller will, in
particular 

  

	 	a)	co-operate on the steps necessary, as the case may be, for a change of the status according to the United States federal income tax laws becoming effective prior to the effective
date of the transfer, namely the Internal Revenue Service Form 8832 –(Entity Classification Election) with signatures, with which Euroareal Produktionsgebäude can be considered as a “partnership for United States federal tax
purposes” according to US federal income tax law even before the effective date of the transfer; additional reference is made to § 7 Section 1 q). 

  

	 	b)	 undertake everything necessary to shift the fiscal year of Euroareal Produktionsgebäude to the effective date of the transfer upon request of the buyer, in
order than Euroareal Produktionsgebäude can be integrated with the buyer for 2a) into an entity for corporate and excise tax purposes from this point in time; in particular, the seller will secure the approval of the relevant tax office
according to § 7 (4) clause 3 of the KStG [Corporate Tax Code] in conjunction with R 59 (3) of the KStR [Corporate Tax Code], as well as finalize a corresponding change in the articles of association of Euroareal 

	 	 
Verwaltungsgebäude by 31 October 2005 and apply for entry into the commercial register. The provisions provided under § 5 Section 2
(iv) remain unaffected. 

  

	 	c)	to allow an accounting firm to be commissioned by the buyers to perform all audits that are necessary on the basis of the requirements of the US securities law.

  

	3.	The seller sells his company share mentioned in § 1 Section 1 free from encumbrances and free of all rights of third parties: 

  

	 	•	 	to the accepting buyer for 2a), a partial company share in the amount of €€22,500.00 (in words: twenty two thousand five hundred Euros), 

 

	 	•	 	to the accepting buyer for 2b), a partial company share in the amount of €€2,500.00 (in words: two thousand five hundred Euros), along with all rights associated
with it. 

  

	4.	Upon first written request by the buyer of 2a) and 2b), the seller is hereby obligated to divide his company share of €25,000.00 in Euroareal
Produktionsgebäude mentioned above into two company shares of €€22,500.00 and €€2,500.00, and to transfer them to the buyers in a separate notarised document under the delaying condition of full payment of the preliminary
purchase price according to § 4 of this document. 

  

	5.	The division of the company share mentioned in § 1 Section 1, as well as in the transfer of the partial company shares sold here, will take place in a separate
document under the condition precedent of the full purchase price payment according to § 4 of this document. 

	6.	This purchase contract is to be carried out on 1 November 2005, subject to § 5 Section 2. 

  
 § 3 
 Effective date of the transfer/profit participation right 
  

	1.	The contractual effective date of transfer (“effective date of the transfer”) is the end the month following full payment of the preliminary purchase price
according to § 5 Section 1. 

  

	2.	The seller is entitled to the profit participation right for the current fiscal year until the effective date of the transfer. 

  
 § 4 
 Purchase price 
  

	1.	The purchase price for the company share in the amount of €€22,500.00 amounts to 90% of the preliminary and final total purchase price yet to be determined, and is to be
paid by the buyer for 2a). 

  
 The purchase
price for the company share in the amount of €€2,500.00 amounts to 10% of the preliminary and final total purchase price yet to be determined, and is to be paid by the buyer for 2b). 

	2.	The preliminary total purchase price according to Section 1 is calculated as follows:– 

  
 €€20,000,000.00 
  

	 	•	 	Plus bank balances according to the “proforma financial statement” as of 30 September 2005, yet to be created, 

  

	 	•	 	Plus accounts receivable up until 30 September 2005, according to the “proforma financial statement” as of 30 September 2005, yet to be created,

  

	 	•	 	Less existing liabilities in each case as of 30 September 2005, and less all accrued liabilities and deferrals as of 30 September 2005, according to the “proforma
financial statement” as of 30 September 2005, yet to be created. 

  

	3.	The final total purchase price is determined with a corresponding application of the preceding Sections 1 and 2. However, within the context of the calculation of the final
purchase price, the financial statement on the day of valuation, to be created according to the detailed requirements of § 5 Section 6, is to appear in place of the “proforma financial statement”; the contractual
effective date of transfer according to § 3 Section 1 is to appear in the place of 30 September 2005. The statement of incidental costs as of 30 September 2005, is to be created on 30 October 2005.

  
 § 5 
 Purchase price due date 
  

	1.	 The preliminary purchase price is due and payable within 10 (ten) bank working days (i.e. working days (except for Saturday) on which banking institutions in
Frankfurt am Main are open for general customer business and to which transfers can be made) after fulfilment of the implementation requirements according to § 5 Section 2 of this contract, but at the earliest 

	 	 
on the last bank working day of that month in which the preceding stipulated period of 10 (ten) bank working days expires. All mentioned payments – even
if not made directly to the seller (on this issue compare Section 4 below) – are made with contractual effect on the purchase price. If the preliminary total purchase price is not paid by the due date, the seller is entitled to
withdraw from this purchase contract according to the detailed requirements of § 11 Section 1. Additional claims of the seller remain unaffected. 

  
 [...] 
  

	2.	The maturity of all payments pursuant to §5 Section 1 and therefore the performance of this agreement (“condition of performance”) are conditional
to the furnishing of the following declarations, documentation, and/or proofs (to be furnished by the Seller): 

  

	 	i)	cancellation of the preliminary encumbrances registered on the basis of the priority notice recorded to secure the claim to a builder’s lien, which notice is recorded in the
land registry of the Mainz District Court, von Weisenau pages 4443 and von Hechtsheim 9881, Section III, nos. 1 and 2 and on page 4443, no. 4, as well as a statement of affirmation from the notary public (no older than five business days) that no
other encumbrances than those listed in §1 Section 3 are registered in the land registry except the mortgage in favour of CSFB which is cited in §1 Section 3, nor any applications for the registration of
encumbrances pending at the land registry office; 

  

	 	ii)	expiration of the statutory prohibition of execution pursuant to Cartel Act (GWB) §41; 

	 	iii)	creation of a supplemental deed for this share purchase agreement comprising the splitting and conveyance (assignment) to the Buyers 2a) and 2b) of the shares hereby
sold, subject to the condition precedent of payment of the provisional purchase price. 

  

	 	iv)	certified photocopies of an amendment of the charter of Euroareal Produktionsgebäude to the effect that its fiscal year ends on 31 October 2005, and that the profit
transfer and controlling agreement of 15 November 2004 is cancelled effective 31 October 2005 (at the latest); as well as a commercial registry extract for Euroareal Produktionsgebäude evincing the amendment to the charter and the
cancellation of the profit transfer and controlling agreement of 15 November 2004 effective 31 October 2005 at the latest. 

  

	 	v)	the occurrence of the conditions for maturity recited in §5 Section 2 (i) to (iv) of the purchase agreement over all shares of Euroareal Mainz
Verwaltungsgebäude Hechtsheimer Strasse GmbH (Exhibit 1 of master instrument of notary public Wolfgang Gruntkowski). 

  

	3.	 The notary is responsible for the determination of and notification with respect to the condition of maturity cited at §5 Section 2 (i); otherwise
the parties are mutually obligated to each other to cause without delay the fulfilment of the other conditions of performance stipulated in §5 Section 2. The Buyers are entitled (but not obligated) to waive in full or in part

	 	 
any and all said conditions solely by a written statement to the notary. If these conditions are not met by 30 November 2005, the Buyers are
entitled under §11 Section 2 to withdraw from this purchase agreement. 

  

	4.	The Seller hereby irrevocably instructs the Buyers to settle the balances owed by the Seller of Euroareal Produktionsgebäude including all interest and incidental expenses out
of the provisional sale price, which amounts are to be accounted against the sale price. The remaining amount is to be paid into an account of the Seller to be named later at Commerzbank Bank AG, Bad Homburg (Sort Code 500 400 00).

  

	5.	Timeliness of payment is determined by the date on which the payment is received by the party entitled to receive it. The Buyers go into default immediately if they do not pay on
time. In such case, a late payment penalty of 8% p.a. above the base rate is charged. 

  

	6.	The calculation of the provisional purchase price is based on the “Proforma financial statement” to be created for 30 September 2005. 

 
 The Seller will take care that, within 20 (twenty) calendar days after
the payment of the provisional purchase price, a financial statement including a balance sheet for the transfer date (hereinafter also “deadline balance sheet”) is created, which, pursuant to the provisions of the commercial code, is to be
created in accordance with the principles of proper bookkeeping and account balancing and with consistent methods of accounting and evaluation, and which serves for determining the purchase price. The provisional purchase price stipulated in §4
may be adjusted only within the limits established by that provision, i.e. in the event that changes occur in the items “bank deposits”, “receivables”, [and/or] “liabilities, reserves and accruals and deferred items”.
Only assets connected with the company’s business purpose – not including the real estate which is the subject of this sale, the development and the operation of the developed real estate – may be counted as assets; intangible assets
and accounting aids may not be counted. No liabilities in connection with maintenance/repair and/or renovation activities may be entered into the deadline balance sheet or the pro forma financial statement. Repair and maintenance reserves are not
entered. Obligations to correct input value-added tax pursuant to Value Added Tax Act (UstG) §15a 

 
which exist on the transfer date are to be entered in a total sum as a liability; the same applies to receivables from a correction pursuant to §15a
UstG. This deadline financial statement and deadline balance sheet, which will also be reviewed in light of the foregoing requirements following an audit within the meaning of Commercial Code (HGB) §317ff., are binding on both parties as the
foundation for the final purchase price calculation to be performed within the framework set forth in § 4 Sections 1 to 3, if and as long as no objections are made to the financial statement, deadline balance sheet, and audit report as
of the transfer date. Objections must be filed in writing within 10 (ten) banking days after the transmittal of the financial statement and deadline balance sheet along with the audit report. They must be directed to the other party respectively.
They must set forth the individual grounds regarding the extent to which the financial statement and deadline balance sheet are allegedly out of compliance with the provisions of this agreement. The minimum and maximum differential amount asserted
on the basis of the objection in relation to the affected items and the resulting consequences for the company’s balance-sheet equity capital must be quantified. 
  

	7.	 In the event of an objection, if the parties are unable to agree on the differential amount within an additional period of 10 (ten) banking days to begin when the
other party 

	 	 
receives the objection, then at the request of one party a neutral auditor to be appointed by both sides jointly will decide it. If the parties are unable to
agree on a neutral auditor within one week after a party requests the appointment of a neutral auditor, then either party has a right to resort to the competent Wirtschaftsprüferkammer to have it appoint the neutral auditor. The neutral
auditor will decide as an arbitrator, and said decision will be binding on all parties. The neutral auditor must give each party an opportunity to explain its position before making a decision; at the request of a party an oral discussion will take
place. The neutral auditor must transmit its decision with the grounds therefore in writing to all parties. Code of Civil Procedure (ZPO) §§ 91 ff. applies to the costs of the arbitration proceedings. The neutral auditor, as the
arbitrator, also decides on the allocation of costs with binding effect as to all parties. 

  

	8.	As soon as the parties have agreed on the final purchase price or the neutral auditor has determined it as binding, the corresponding balance shall be paid by the party owing to the
other party respectively. 

  
 §6

 Additional purchase price (“earn-out”)/further leasing 
  

	1.	In so far as the sum total of the net actual rents to be detailed herein below which are paid by the lessees during an earn-out period of three years to be detailed herein below is
higher than €€7,005,000.00, the seller will receive an earn-out payment to be detailed below in addition to the purchase price stipulated in § 4 at the time stipulated in paragraph 5. This does not apply in so far as the
Buyers exercises their right under 

	 	 
paragraph 3 below to terminate prematurely the agreement made in this § 6 regarding the earn-out payment. 

  

	2.	A potential earn-out payment is determined as follows: 

  

	 	i)	The earn-out period of three years begins on the first calendar day of the month following the transfer date stipulated in § 3 Section 1 and ends upon the
expiration of 36 (thirty-six) months. 

  

	 	ii)	Net actual rents within the meaning of the agreements made in this § 6 are the actual rental incomes for the lease of rooms minus all leasing and development costs of
the lesser and all non-apportionable operating expenses and the costs of facility management, minus the legal value-added tax. The leasing and development expenses (particularly but not exclusively brokerage fees, development expenses and other
incentives) are apportioned, i.e. amortized, on the basis of an interest rate of 10% over the fixed term of the lease (beginning with the agreed commencement of rent payment). 

  

	 	iii)	 If, and to the extent that, the cumulative net actual rents paid by lessees over the earn-out period exceed €€7,005,000.00, and this occurs as a result of
lease agreements with a fixed term of at least seven years (to begin with the commencement of the earn-out period), which agreements were not yet in existence when this purchase agreement was concluded, the earn-out payment is calculated from the
amount above €€7,005,000.00 assessed for such leasing (“Surplus amount”). This amount is 

	 	 
converted to an annual basis, i.e. divided by 3 (three), and subsequently multiplied by 8.3 (eight point three). A sample calculation is enclosed as

  
 Attachment 2 “Sample calculation of
earn-out payment” 
  

	 	iv)	To the extent that the surplus above the amount of €€7,005,000.00 cited in paragraph 1 is based on leases with a term of less than 7 (seven) years, the amount of
the earn-out payment according to (iii) is limited to 50% of the actual effective rents owed during the term of the lease. 

  

	 	v)	If present or future tenants fail to extend their lease or fail to meet their rent payment obligations or other payment obligations, and as a result the net actual rents paid during
the earn-out period are below the threshold sum of €€7,005,000.00 according to paragraph 1, there will be no earn-out payment; in other words, only the payments which actually occur (and not the payments which are owed) during the
reference period (earn-out period) count toward the calculation of the earn-out payment. However, the special provision according to (vi) below remains unaffected; 

  

	 	vi)	 Animalised lease agreements which are at an advanced stage of negotiation at the end of the earn-out period and are finalized within three months thereafter also

	 	 
fall under the provisions of this § 6 and are to be treated as if they were finalized during the earn-out period. The earn-out payment to be paid
for these agreements is not due until the respective [lessee] has paid a full month’s rent for the first time. 

  

	3.	If the annual net actual rents actually paid do not increase by at least €€1,000,000.00 during the first 24 (twenty-four) months of the earn-out period, the Buyers can
withdraw from this § 6 through a unilateral written declaration to the Seller. In such case the Seller has no claim to [a continuing]earn-out payment. The maturity provision according to paragraph 5 below remains unaffected
hereby. 

  

	4.	The calculation of the earn-out payment is based on lease agreements with respect to which the lesser can opt for value-added tax. If this is not possible, the Seller must
compensate the Buyers for any losses and other financial detriments it suffers with a lump sum payment to be paid by the Seller concurrent with the finalization of the lease agreement. To the extent that the settlement is offset by additional rents
to be paid by the lessee, these rents are fully excluded from the calculation of the earn-out payment. 

  

	5.	The Buyers promise to calculate the earn-out payment within one month after the expiration of the earn-out period and to transmit the calculation to the Seller. This calculation is
binding on the Seller if it does not object within 10 (ten) banking days. In the event of an objection, the procedure stipulated in § 5 Section 6 is to be applied accordingly. The earn-out payment is due and payable as soon as the
parties agree to its amount, or the neutral auditor determines its amount as binding. 

	6.	The Seller will itself and/or through companies affiliated with it acquire additional tenants for the purchase property and in particular use best efforts to utilize its business
relationships with local and regional officials for such purpose, and will use sustained efforts to bring about the further development of the purchase property as a technology centre that is integrated into the surrounding regions. This will entail
the activation, use, and optimisation of the synergies offered by the high-tech, medical tech, biotech, and pharmaceuticals companies which are already located on the purchase property. The Buyers alone have sole discretion to decide on the
concluding of lease agreements with tenants suggested by the Seller. 

  
 § 7 
 Guarantees and quality agreements of the Seller 
  

	1.	Seller’s guarantees 

  
 Through this independent guarantee, the Seller warrants to the Buyers the following facts: 
  

	 	a)	The statements in § 1 of herein are true. The shares sold have been neither given nor taken in pledge nor are otherwise encumbered by the rights of third parties
(including voting obligations, voting rights or profit sharing rights) or by restraints on alienation or disposition of any kind. The Seller and Euroareal Produktionsgebäude are duly established limited liability corporations under German law;
Euroareal Produktionsgebäude has a registered capital of €25,000.00. The Seller is the only shareholder of Euroareal Produktionsgebäude. The information in the commercial registry extract regarding the Seller and Euroareal
Verwaltungsgebäude corresponds to the actual circumstances. The Seller has an unlimited right to make and execute this agreement and to dispose of the shares, nor do said actions result in the breach of any duties under the partnership
agreement or other contracts 

	 	 
to which the Seller or Euroareal Produktionsgebäude is bound. The shares are not subject to any rights of pre-emption or acquisition of third parties.

  

	 	b)	All contributions for the shares have been fully paid and have been neither wholly nor partly reclaimed; nor is there any duty to make subsequent contributions.

  

	 	c)	No profit allocation resolutions regarding Euroareal Produktionsgebäude which relate to the period after the transfer date have been passed, and no advance payments of profits
which will not accrue until the transfer date have been made or promised. 

  

	 	d)	 There are no company-transfer agreements of any kind with Euroareal Produktionsgebäude and its affiliates, i.e. shares thereof, particularly not within the
meaning of Stock Corporations Act (AktG) §§§ 291, 292; there have been no reorganization resolutions passed or any other measures encompassing reorganization, particularly pursuant to the Law on the 

	 	 
Transformation of Companies (UmwG), nor any existing silent partnership agreements, sub-partnerships, profit participation loans or other agreements, nor
options or similar rights thereto. Euroareal Produktionsgebäude is not a member of an actual group of affiliated companies. 

  
 However, the Buyers are aware that a value-added tax group exists among the Seller, Euroareal Beteiligungs GmbH and its affiliates, and Euroareal
Produktionsgebäude. But no VAT arrears exist either on the part of the Seller, Euroareal Beteiligungs GmbH and its affiliates, or Euroareal Produktionsgebäude. 
  

	 	e)	The shares sold constitute the entire registered capital of Euroareal Produktionsgebäude; the Seller is the sole shareholder of Euroareal Produktionsgebäude; there are no
third-party claims of any kind whatsoever to the acquisition of shares. 

  

	 	f)	Bankruptcy proceedings have not been instituted in relation to the assets of Euroareal Produktionsgebäude or the Seller’s assets. There has been no petition to institute
such proceedings, nor is there any valid legal requirement that they be instituted, nor are they imminent for any other reason. Neither the Seller nor Euroareal Produktionsgebäude is insolvent or overindebted. 

  

	 	g)	 The partnership agreement corresponds to the certificate of incorporation dated 18.03.2004 which is provided in Attachment 

	 	 
VII.1 as the reference document. There are no other agreements or resolutions relating to the partnership agreement. 

  

	 	h)	Euroareal Produktionsgebäude owns the purchase property described in detail in § 1(3) including all buildings thereon; the only encumbrances on said property are
those recited in § 1(4); Euroareal Produktionsgebäude is also the absolute owner of all other assets including all claims, credits, and liquid assets, which 

  

	 	i)	are included in the annual financial statement or in the “pro forma financial statement” per 30 September 2005, 

  

	 	ii)	it has subsequently acquired after 30 September 2005, 

  

	 	iii)	it needs in order to fulfil its contractual duties. 

  
 No third party has rights thereto. Additions to and deductions from the property assets have occurred only in the ordinary course of business. The
ownership of the purchase property, including all buildings and technical equipment and facilities thereon, is disposable in a scope which allows Euroareal Produktionsgebäude to fulfil all obligations with respect to leasing under the lease
agreements enclosed in Attachment V. of the reference document. 
  

	 	i)	Euroareal Produktionsgebäude holds no interests in other companies; in particular, it holds no partnership rights or participation rights as to other companies, be they
partnerships, corporations, or commercial companies, and is not bound by any partnership agreements accordingly. 

	 	j)	Up to the present day, the only existing of impending liabilities of Euroareal Produktionsgebäude are those cited in the balance sheet of Euroareal Produktionsgebäude from
31.12.2004 which is enclosed in Attachment VII.2 of he reference document and those cited in the “pro forma financial statement” which will be created. All receivables declared for the transfer date in the “pro forma
financial statement” to be created or in the financial statement including the deadline balance sheet are recoverable (collectible). 

  

	 	k)	The annual financial statement of Euroareal Produktionsgebäude as of 31 December 2004 and the “pro forma financial statement” to be created comply with
the provisions of the commercial code and the principles of standard bookkeeping and account balancing and employ consistent balancing and evaluation methods; the financial statements are complete and accurate, they give an accurate picture of the
asset and earnings situation of Euroareal Produktionsgebäude; there is no reason to fear possible adverse changes of the asset and earnings situations. All reserves, value corrections and suchlike which constitute asset reducing or liability
increasing items – with the exception of reserves for building related repairs and maintenance or reserves for the additional payment of operating expenses – have been calculated and disclosed accurately and completely.

	 	l)	Euroareal Produktionsgebäude has paid, or has withheld and remitted, all taxes and public charges and, to the extent not paid or remitted, has deferred said taxes and charges
in the balance sheet of the annual financial statement, the balance sheet of the “pro forma balance sheet” to be created, and the deadline financial statement, for future taxes and charges as well, and has reduced its equity capital
accordingly. Furthermore, it has given and filed on time, completely, and truthfully all declarations required by tax and other government authorities. There are no outstanding tax assessment notices in relation to Euroareal Produktionsgebäude.

  

	 	m)	Euroareal Produktionsgebäude has not undertaken any open or hidden dividends. All service relationships with affiliated companies bear comparison with external relationships
and otherwise satisfy all tax conditions for recognition. 

  

	 	n)	The refinancing actions (Debeka and CSFB) of the real estate holdings of Euroareal Produktionsgebäude in 2004 and 2005 did not result in any tax liabilities, particularly tax
liabilities on the basis of hidden dividends. 

  

	 	o)	All invoices to or from third parties, in particularly for rents pursuant to leases, have been presented by or to Euroareal Produktionsgebäude in such a way as to comply with
the legal provisions of the Value-Added Tax Act, and particularly the input VAT as of the date claimed or the date used has been deducted in compliance with legal requirements. 

	 	p)	In leasing the purchase property, Euroareal Produktionsgebäude has elected an effective VAT option that allows all the VAT stated in the invoices that list it as the recipient
of the corresponding deliveries or other services to be treated as refundable or offsettable input tax. 

  

	 	q)	 Euroareal Produktionsgebäude has not filed a petition to change its status within the meaning of the United States federal income tax code, namely any petition
according to Treasury Regulation Section 301-7701-3(c) on Internal Revenue Service Form 8832 (Entity Classification Election); currently the interpretation of Euroareal Produktionsgebäude within the meaning of the US Federal Income Tax
Code is the interpretation according to Treasure Regulations Section 301-7701-3(b)(2). The company has no other assets (in the past either) other than the purchase property with the buildings, annexed personal property (fittings and fixtures),
cash in hand, bank deposits and claims such as claims for rent which derive from the running leasing business; the company does not have (and never had in the past) any stocks, loans, debenture bonds, or other dividend papers, nor has the company
have made any advance payments to an emitter of securities (including affiliated companies or tenants); the company is not, and has never been, party to a lease agreement over personal property except for lease agreements relating to a combination
of personal property and real property where the rents for the 

	 	 
personal property amounts to les than 10% of the total rents (calculate on the basis of the average market value of the personal property at the beginning
and end of the fiscal year relative to the average market value of the real property including the personal property at the beginning and end of the respective fiscal year); and Euroareal Produktionsgebäude also has not earned more than USD
20,000.00 in income in a calendar year from sources other than rents and interest on bank deposits. 

  

	 	r)	Euroareal Produktionsgebäude has not entered an employment relationship with any person, its managers not excepted. 

  

	 	s)	The mortgages cited in § 1 Section 4 and § 5 Section 2 (i) secure the liabilities of Euroareal Produktionsgebäude only, i.e. not the
liabilities of third parties or affiliated companies. 

  

	 	t)	Euroareal Produktionsgebäude has satisfied fully and finally all obligations resulting from the loan granted by Debeka Bausparkasse AG. Euroareal Produktionsgebäude has no
further liabilities as a result of, or in connection with, loan agreements, particularly vis a vis the Seller. Furthermore, Euroareal Produktionsgebäude satisfied all liabilities resulting from the loan agreement with CSFB by the transfer date.

  

	 	u)	 The purchase property is free of obligations to construct or maintain, unrecorded easements, and no restrictions according to the law of neighbours except such

	 	 
encumbrances as are contained in § 1 Section 4 in conjunction with Attachments I.7-8 and I.11-12 of the reference document.

  

	 	v)	In the buildings standing on the purchase property, there is no asbestos requiring immediate removal pursuant to the respective official regulations. 

  

	 	w)	The plan for voluntary soil air decontamination enclosed as Attachment IX will be completed by 30.06.2006. 

  

	2.	Quality agreements 

  
 The Seller further warrants, with respect to an agreed quality for purposes of the Seller’s legal or contractual warranty liability, that the
following statements are true as of today and will be true as of the transfer date: 
  

	 	a)	As of the transfer date, all development assessments pursuant to Building Code (BauGB) §§§ 123 ff. and other public charges pursuant to the Municipal Charges Act and
the corresponding municipal codes, as well as cost reimbursement claims, amounts for discharge and compensation, and other public assessments due for the currently existing development of the purchase property for the uses on which this purchase
agreement is based, have been paid in full; the same is true of the connection to the public water and sewer supply and the power supply. 

	 	b)	For all buildings on the purchase property, all the required building and use permits have been obtained unconditionally and indefinitely, including parking lot documentation and
all other official permits, and all obligations required in the permits granted have been met. This also applies to the directions/obligations under the current fire code and corresponding official regulations. The units that are still rentable in
buildings 01 and 11 correspond to the requirements for the use of clean rooms by high-tech companies, medical tech companies, biotech companies, and pharmaceutical companies. 

  

	 	c)	Euroareal Produktionsgebäude has, and had in the past, insurance which it is contractually required to hold; it was and is further insured, in the amounts cited in Attachment
II of the reference document, against risks against which this kind of company, exercising ordinary care, is usually insured. 

  

	 	d)	Euroareal Produktionsgebäude is not in arrears with any premium payment, and there do not exist any circumstances that call into question the continuation of the insurance.
Copies of the corresponding insurance policies are enclosed as Attachment II.3 and 4 to the reference document. Euroareal Produktionsgebäude has not filed any claims or requested any coverage commitments in relation to the insurance policies.

  

	 	e)	 Except for the agreements cited in § 1, copies of which are enclosed in attachment to the reference document, in the versions cited therein and with
contents as they 

	 	 
appear in the reference document, and except for standard agreements on proper management of the real estate, Euroareal Produktionsgebäude is not bound
by any agreement, particularly not the following: 

  

	 	i)	agreements with the Seller, companies affiliated with the Seller, or relatives with in the meaning of the Fiscal Charges Regulations (Abgabenordnung) § 15,

  

	 	ii)	rental and lease agreements over real property, 

  

	 	iii)	employment, hiring, and service agreements of any kind except for management agreements, but the latter without remuneration or buy-out obligations, 

  

	 	iv)	support commitments and promises to share profits; 

  

	 	v)	collective labour agreements and plant agreements, 

  

	 	vi)	loan agreements, 

  

	 	f)	The agreements enclosed with the reference document are enclosed in full; no amendments, additions, or collateral agreements have been made, 

  

	 	g)	The agreements concluded by Euroareal Produktionsgebäude have not been terminated up to the present day. Terminations of these agreements by the other party are not imminent at
the present time, and there exist no circumstances or reasons that would justify such termination. No defaults in performance have occurred with respect to these agreements. 

  

	 	h)	All rental agreements of Euroareal Produktionsgebäude (Attachment V of reference document) with a remaining term of more than one year satisfy the formal requirements per
German Civil Code §§§ 550, 126. 

	 	i)	There exist no advance disposals of rent, no advances on building costs subject to refund by the Seller, and/or no other refundable advances by tenants. 

  

	 	j)	There are no collateral agreements with tenants, neighbours, or government officials which are not apparent from the attachments to the reference document. 

 

	 	k)	No agreement exists with Euroareal Produktionsgebäude and/or the Seller or a company affiliated therewith which causes adverse legal consequences to Euroareal
Produktionsgebäude in the event of a change of shareholders at Euroareal Produktionsgebäude. 

  

	 	l)	Euroareal Produktionsgebäude is not subject to any special restraints on competition of a private-legal or public-legal nature. 

  

	 	m)	Euroareal Produktionsgebäude enjoys an unchallenged, permanent right of use with respect to all copyrighted maps, expert opinions, and computer software which is necessary and
actually used for maintaining and operating the buildings. 

  

	 	n)	Neither the Seller nor Euroareal Produktionsgebäude is involved in proceedings before government courts, arbitrators, or other authorities or government institutions. Nor have
the Seller or Euroareal Produktionsgebäude been threatened with such proceedings. 

	 	o)	The Seller assumes liability to the Buyers for damages, detriments and expenses resulting from the existence of environmental contamination of the ground water, soil, and/or
buildings, which has occurred hitherto or may yet occur due to their present condition, for which claims may be lodged against the Buyers or Euroareal Produktionsgebäude. The liability includes obligations or claims of third parties under civil
law and public law. To the extent that stipulations are made in the purchase agreement (Attachment IV 2 to reference document) respecting environmental damage which was established hitherto, the Seller is liable only to the extent that measures must
be taken in order to guarantee that the use of the purchase property and buildings and building structures by the owner and the tenant at the time is not impaired or at risk of a diminution of rent. 

  

	 	p)	Recourse within the meaning of the Federal Soil Protection Act § 24(2) against Euroareal Produktionsgebäude or the Buyers is excluded; to the same extent the Seller waives
its claims against the Buyers and Euroverwaltungsgebäude as a result of or in connection with environmental impact. 

	3.	Other agreements 

  
 The Seller and Buyers further agree as follows: 
  

	 	a)	To the extent that claims exist against the Seller on the basis of provisions for the protection of the registered capital of Euroareal Produktionsgebäude, the Seller
undertakes, by this purchase agreement also, that it will satisfy said claims. 

  

	 	b)	To the extent that the deadline financial statement discloses a deficiency which is not covered by the equity capital, the Seller promises to settle said deficiency. To the extent
that the Seller has made payments to Euroareal Produktionsgebäude before the transfer date for this purpose, which add to the bank deposits stated in the deadline financial statement, the final purchase price will not be increased due to this
bank deposit when it is calculated per § 4 Sections 2 and 3. 

  

	 	c)	Upon receiving a corresponding request from the Buyers, the Seller will declare its consent to the technical due diligence reports which are arranged by CFSB in connection with the
financing it provides being “addressed” to the Buyers as well, so that the Buyers may bring potential claims against the author of the report. In the event of such a request, the Buyers must pay 50% of the expenses for creating the
respective report to which the Buyers’ request relates and the transmittal expenses. 

  

	 	d)	The Buyers take notice of the Seller’s intent that the water house which is operated by Euroareal Produktionsgebäude in building 02/03 on the purchase property of [sic]
should undergo economic optimisation. 

 This includes potentially outsourcing the water house. The Seller declares that operating expenses
additionally incurred by Euroareal Produktionsgebäude for this purpose are assessable. 
  
 § 8 
 Special liability of the Seller and Euroareal Produktionsgebäude GmbH

  

	1.	Release 

  
 The Seller releases the Buyers and Euroareal Produktionsgebäude from potential claims by third parties, also in relation to future circumstances, in
the following cases: 
  

	 	a)	The Seller on first request will release Euroareal Produktionsgebäude from all liabilities which may reach it on the basis of joint and several liability for the Seller’s
and its affiliates’ obligations. This applies particularly to joint and several liabilities or joint liabilities of Euroareal Produktionsgebäude and the Seller arising from or in connection with the agreement with IBM Deutschland GmbH
dated 21/24 May 2005 (Attachment V.4 of reference document); 

  

	 	b)	The Seller releases Euroareal Verwaltungsgebäude and the Buyers from any and all tax claims based on the existence and/or termination of the profit-and-loss transfer agreement
cited in § 5 Section 2 (iv) and will compensate them for any losses that have resulted or will result therefrom but only to the extent that absolutely sufficient reserves have not been set aside for this purpose.

	 	c)	The Seller releases Euroareal Verwaltungsgebäude and the Buyers from all payment obligations in relation to taxes and public charges for facts [sic] up to the transfer date, to
the extent that the deadline balance sheet does not include any reserves, or if it does, insufficient reserves for this purpose. The Seller promises to release the Buyers and Euroareal Produktionsgebäude from all payment obligations and other
detriments which occur if the independent warranties contained in § 7 Section 1(d), (l), (m) and (n) are untrue. § 9 Section 1 remains unaffected. 

  

	2.	Surety of Euroareal Beteiligungs GmbH and CPB Cooperative für Planen und Bauen GmbH 

  
 Upon the finalization of this purchase agreement, Euroareal Beteiligungs GmbH and CPB Cooperative für Planen und Bauen
GmbH become personal sureties, respectively, of all the Seller’s obligations under this agreement. Claims of the Buyers based on these sureties lapse after a five- year period, to begin at the end of the day on the transfer date. 

 § 9 
 Seller’s liability 
  

	1.	Warranties 

  
 The warranties given in § 7 Section 1 are governed by the respective legal rules. 
  

	2.	Quality agreements and release obligations 

  
 If one of the quality agreements given in § 7 Section 2 is wholly or partly untrue, at the Buyers’ request the Seller must:

  

	 	i)	pay the Buyers cash compensation or, 

  

	 	ii)	create a condition at Euroareal Produktionsgebäude which corresponds to the agreed quality, 

  

	 	iii)	release the Buyers, 

  

	 	iv)	pay Euroareal Produktionsgebäude cash compensation 

  

	 	v)	release Euroareal Produktionsgebäude. 

  
 § 10 
 Lapse

  

	1.	Lapse of the warranty claims 

  
 Claims based on the untruth of warranties made in § 7 Section 1 lapse in 10 (ten) years. 

	2.	Lapse of claims based on quality agreements 

  
 Claims of the Buyers based on the untruth of the quality agreements in § 7 Section 2 lapse in five years. 
  

	3.	Lapse of claims based on taxes 

  
 Claims of the Buyers based on taxes or public charges lapse six months after the date on which the corresponding tax or public charge, i.e. the liability
amounts, were (materially) finally and absolutely assessed against Euroareal Produktionsgebäude, but no sooner than five years thereafter. Paragraph 1 remains unaffected. 
  

	4.	Lapse of release claims 

  
 The Buyers’ release claims lapse in five years; longer limitations periods for claims based on the untruth of warranties or based on tax risks remain
unaffected. 
  

	5.	Beginning of limitation period 

  
 Said limitations periods begin at the end of the day on the transfer date. 

  
 § 11 

Rights of Withdrawal 
  

	1.	Seller’s right to withdraw 

  
 The Seller has a right to withdraw from this purchase agreement if the Buyers are in arrears on the payment of the provisional purchase price for longer
than ten banking days, and an additional period of at least another ten banking days, which the Seller grants the Buyers in writing (per courier and, as provided in paragraph 3, by fax) under threat of withdrawal, expires without results.

  

	2.	Seller’s right of withdrawal 

  
 The Seller has a right (only jointly) to withdraw from this purchase agreement by written declaration (per courier and telefax), provided that the
conditions of maturity-performance pursuant to § 5 Section 2(i) to (iv) of this agreement or the conditions of maturity-performance per § 5 Section 2(i) to (iv) of the agreement on Euroareal Mainz
Verwaltungsgebäude Hechtsheimer Strasse GmbH which is finalized today have not been fully brought about by November 30, 2005. the Buyers (only jointly) have a further right to withdraw from this agreement by written declaration if
they simultaneously withdraw from the agreement on Euroareal Mainz Verwaltungsgebäude Hechtsheimer Strasse GmbH which is finalized today, or the agreement on Euroareal Mainz Verwaltungsgebäude Hechtsheimer Strasse GmbH which is finalized
today is voided in connection with compensatory damages to be paid to the Buyers. Other legal rights of withdrawal on the part of the Buyers, namely based on the breach of the Seller’s warranties, remain unaffected. 

	3.	Exercising the rights of withdrawal 

  
 The right of withdrawal must be exercised by a written declaration (per courier and telefax) to the other party to the attention of the notary, whom the
parties hereby irrevocably authorize to receive both the declarations warning that withdrawal rights will be exercised and the withdrawal declaration itself. The withdrawal declaration is effective (only) upon receipt of the declaration by the
notary by messenger. Fax messages serve only for informing the parties involved neither its receipt nor its omission is material to the effectiveness of a warning of withdrawal or the exercise of withdrawal rights. The notary is responsible for
notifying the other party immediately of the warning and the exercising of rights of withdrawal; the omission of such notice will not affect the validity of the declarations. The rights of withdrawal of the parties are extinguished immediately two
months after the date on which notice of the grounds of withdrawal is received if the respective withdrawal rights have not been exercised by then. 
  
 § 12 
 Other duties of the
Seller 
  

	1.	The Seller will take care that Euroareal Produktionsgebäude conducts its businesses exclusively in the ordinary course from the date of the adoption of this document until the
assignment of shares goes into effect. Investment measures require the approval of the Buyers, which may not refuse it for irrelevant reasons. 

	 	 
Amendments to existing lease agreements and/or the concluding of new lease agreements require the approval of the Buyers, who are entitled to decide at their
own discretion. 

  

	2.	The Seller promises not to resolve to undertake, from the date on which this document is adopted until the assignment of shares goes into effect, any withdrawals, profit sharing
rights, or other financial transactions to the debit of Euroareal Produktionsgebäude, to carry out any potential corresponding resolutions, or, after the above referenced date, to demand their execution or to take other actions with a similar
effect, to the extent that said actions relate to profits which arise after the transfer date. 

  
 § 13 
 Severability 
  
 If a provision of this agreement is invalid or is or becomes unperformable, the validity of
the agreement is otherwise unaffected. The parties promise that the invalid or unperformable provision will be replaced with a valid and performable provision, which best corresponds to the spirit and purpose of the original provision. The same
applies to loopholes accordingly. 
  
 § 14 

Final provisions 
  

	1.	 This purchase agreement is recorded together with the purchase agreement covering all shares of Euroareal Mainz Verwaltungsgebäude Hechts-Heimer 

	 	 
Strasse GmbH in a master document. The costs for recording are allocated to the two purchase agreements according to the ratio of the amounts cited in
§ 4 Section 2 paragraph (1). The costs thus allocated to the Buyers, in addition to the costs for the addendum cited in § 2 Section 1, are borne by the Buyers in proportion to their purchase shares. All costs for
clearing encumbrances, including clearing encumbrances on the purchase property pursuant to this agreement, are borne by the seller. Otherwise, unless otherwise agreed, each party bears the costs and taxes that have accrued, or will accrue, to it.
Potential land purchase taxes are borne by the Buyers. The notary has advised concerning the land purchase tax issue. 

  

	2.	In so far as notarised form is not prescribed, amendments and additions to this agreement must be in writing. 

  
 § 15 
 Rights, jurisdiction 
  

	1.	This agreement is governed by German law, including in cases where the German conflicts-of-law rule points to another legal system. On the other hand, the UN law on sales does not
apply. 

  

	2.	Mainz is the jurisdiction for all disputes arising under this agreement and its performance. This also applies to the claims arising under the suretyship stipulated in § 8
Section 2. 

  
 § 16 

Miscellaneous and instructions 
  

	1.	The Buyers will instruct Euroareal Produktionsgebäude about the change of shareholders pursuant to the Law on GmbH’s § 16. 

  

	2.	The notary has further made reference to the liability provisions of the Law on Limited Companies, particularly to the fact that the buyer of a share assumes unlimited liability for
unpaid cash contributions and potentially for deficiencies resulting from inadequate contributions in kind of the Seller and all other shareholders; similarly for refunding potentially prohibited repayments back into the registered capital and for a
potential land purchase tax liability. 

  

	3.	The parties are aware that a bona fide acquisition of shares of a business is impossible. The stated participation ratios, which are based on statements of the participants, are
verifiably by the notary only to a limited degree. 

  

	4.	The approval of the shareholders of the foregoing agreement on the splitting and assignment of shares is given below. 

  

	5.	All approvals become effective when received by the notary. 

  

	6.	The participants affirm that the notary has not provided any tax advice. 

  
 § 17 

Approvals and assumptions of liability, shareholder meeting 
  
 Messrs. Fritz Eduard Skrzypczak and Rolf Breuer, in their capacity as managers of Euroareal Produktionsgebäude and of Seller with joint
power of attorney, do hereby state their approval of this document and particularly the split and assignment agreed in § 2 Section 3 to 5 of this copy. The Seller waives irrevocably any and all rights of pre-emption, purchase, option, or
similar rights, whether deriving from statutory law, the partnership agreement, or any other source. 
  
 The sole shareholder of Euroareal Produktionsgebäude, by and through Messrs. Fritz Eduard Skrzypczak and Rolf Breuer, do convene a shareholder meeting of Euroareal Produktionsgebäude and, dispensing with all
formalities and regulations for convocation and all notice periods with respect to a plenary meeting, do resolve the following: 
  
 “The stipulated split and the sale and future assignment of the shares of Euroareal Mainz Produktionsgebäude Hechtsheimerstrasse GmbH to the
named Buyers is hereby irrevocably ratified. The shareholder further waives irrevocably any and all rights of pre-emption and purchase and similar rights, whether deriving from statute, the partnership agreement, or any other source. No other
resolutions are passed today.” 

  
 § 18 

Translation 
  
 The English version of this document serves solely for linguistic comprehension; only the German version is binding. In the event of discrepancies or inconsistencies
between the German and English versions, the German version takes precedence. 
  
 Taken in attachment to the document of notary public Wolfgang Gruntkowski of Cologne, on this day, UR.No. 1577 in 2005. 
  

	
	Cologne, 22 September 2005
	
	 [See source for signatures.]

 [see original for graphic; terminology glossary appears below] 
  
 Tor = gate 
  
 “Als Anlage zur Urkunde vom heutigen Tage – UR Nr. 1577 / 2005 des Notars Wolfgang
Gruntkowski in Köln. Köln den 22.09.2005.” = “As an attachment to the document of the notary public Wolfgang Gruntkowski in Cologne on the present day, document number 1577 / 2005. Cologne on the 22 September 2005.”

  
 Planinhalt = plan contents 
  
 Massstab = scale 
  
 Datum = date 
  
 Gezeichnet = signed 
  
 Lageplan = site plan 
  
 Nutzung- / Wege- /Zugangsrecht = right of use / passage /
entry 
  
 Dienstbarkeit für die Kantine =
easement for the cafeteria 
  
 Parkplätze
von IBM [illegible] mit kurzfristiges Kündigungsrecht = parking places for IBM [illegible] with short-term right of cancellation 
  
 Parkplätze von IBM, Bestandteil des [illegible] = parking places for IBM, part of the [illegible] 
  
 Dienstbarkeit für Geb. 12 [illegible] = easement for
building 12 [illegible] 
  
 Dienstbarkeit
für Geb. 20/82 = easement for building 20/82 
  
 IBM Verwaltung = IBM management 
  
 [in
English] 
  
 As Appendix 2 to Deed dated this day - Roll no. 1577/2005 of Notary
Wolfgang Gruntkowski in Cologne. Cologne 22.09.2005. [signatures] 

  
 I. 
 Acceptance 
  
 In accordance with the deed of the authenticating Notary, dated 22 September 2005, Deed No. 1577 for the year 2005, the Seller has submitted to the Purchasers
the offer to conclude a Framework Contract for the purchase in respect of: 
  

	a)	Euroreal Mainz Verwaltungsgebäude Hechtsheimerstrasse GmbH, 

  

	b)	Euroreal Main Produktionsgebäude Hechtsheimerstrasse GmbH. 

  
 In accordance with the deed of the authenticating Notary, dated 10 October 2005, Deed No. 1660 for the year 2005, the Seller extended the set period for
acceptance of the above-mentioned offer until 19 October 2005. 
  
 The
Purchasers hereby accept this offer in its entirety. With this acceptance, the above-mentioned Framework Contract and the Purchase Contract appended to the Framework Contract as Annexe 1 in respect of all of the shares in Euroreal Mainz
Verwaltungsgebäude Hechtsheimerstrasse GmbH (hereinafter the “Administrative Building Purchase Contract”) and the contracts appended to the Framework Contract as Annexe 2 in respect of all of the shares of Euroreal Mainz
Produktionsgebäude Hechtsheimerstrasse GmbH (hereinafter the “Production Building Purchase Contract”) come into formal effect. 

  
 II. 
 Modification of individual contractual conditions 
  
 The Seller and the Purchasers hereby agree to the following changes in the above-mentioned set of contracts: 
  

	1.	In accordance with § 2 Section 2 c), the following insertion is made as d) in both the Administrative Building Purchase Contract and the Production Building Purchase
Contract: 

  
 “In the implementation of this
Purchase Contract, the Seller provides an undertaking, with payment of the amount due on execution as a condition precedent, to cooperate in the dismissal of the present Managing Director and the appointment of one or a number of new managing
directors.” 
  

	2.	Furthermore, the following insertion is made as e) in § 2 Section 2 of the Production Building Purchase Contract: 

  
 “The Purchasers intend to have the Clean Room and what is termed the
‘Water House’ located in Building 02/03 operated and managed by another company. Within the context of what is legally possible, the Seller undertakes to take steps to ensure that in the execution of this Purchase Contract, the Euroreal
Produktionsgebäude (Production Building) will cooperate in all measures to be carried out in connection with this.” 
  

	3.	§ 2 Section 7 of the Administrative Building Purchase Contract and § 2 Section 6 of the Production Building Purchase Contract respectively, are reworded as
follows: 

  
 “This Purchase Contract is to be
implemented on 31 October 2005 at 24:00, subject to the arrangements in § 5.2.” 

	4.	In accordance with § 4 Section 3, the following § 4 Section 4 is to be inserted in the Administrative Building Purchase Contract and in the Production Building
Purchase Contract respectively: 

  
 “The
Seller provides an undertaking to submit by 25 October 2005 a set of annual accounts for the year to 31 December 2004 and the “Proforma Statement” as per 30 September 2005 still to be produced. The “Proforma
Statement” as per 30 September 2005 must take into full account all of the existing obligations in respect of CSFB and all other obligations and contingent obligations, in particular in respect of taxes. This applies correspondingly for
the annual accounts for the year to 31 December 2004. 
  
 The Purchasers are entitled to check for themselves the annual accounts for the year up to 31 December 2004 and the “Proforma Statement” as per 30 September 2005 or to have them audited at their own cost by a business
auditing company to be nominated by themselves. If the Purchasers should have any reservations about the provisional purchase price calculated on the basis of these accounts, then the difference between the provisional purchase price calculated as
by the Seller and that calculated by the Purchasers, having taken into account their reservations, is to be paid into a third-party account of the authenticating Notary, the details of which account are still to be notified. As soon as the parties
have reached agreement on the final purchase price after submission of the statement for the reference date, or the final purchase price has been bindingly calculated by the neutral auditor through application of the procedure as per § 5
Section 8 [erroneously designated as § 5 Section 6 in the Administrative Building Purchase Contract in the deed of the authenticating Notary dated 22 September 2005, Deed No. 1577 for the year 2005], then the amount paid
into the third-party account is to be 

 
paid out to the parties proportionately to their respective entitlements. The payment of the final purchase price remains unaffected by the above-mentioned
arrangement. 
  
 The annual accounts for the year up to
31 December 2004, to be submitted by the Seller by 25 October 2005, shall represent those accounts on which the Seller’s guarantees shall be based. In this connection, the parties shall make it clear that the circumstances of which
the Purchasers have become aware within the context of their due diligence activities shall in no way restrict these guarantees from the Seller. To this extent, § 254 of the BGB / Civil Code is excluded.” 
  

	5.	The Purchasers are entitled to withdraw from these contractual arrangements if, by 25 October 2005, the Seller has not submitted the accounts stipulated in Point 4. (by fax or
by e-mail to Deloitte & Touche, Frankfurt). In this case, the costs of notarial authentication will be borne by the Seller, this without prejudice to any further claims on the part of the Purchaser. 

  

	6.	§ 5 Section 4 of the Administrative Building Purchase Contract is reworded as follows: 

  
 “The Seller hereby irrevocably instructs the Purchaser to settle by means of offsetting against the purchase price the
following: 
  

	 	a)	the balances owed by the Purchaser to Euroreal Administrative Building, inclusive of all interest and accessory claims, and 

  

	 	b)	 the claim held by Debeka Bausparkasse AG to the amount of € 3,627,889.78 (in words: three million, six hundred and twenty-seven thousand, eight hundred
and eighty-nine euro and 78 eurocents), 

	 	 
From the remaining amount, a deduction to the amount of € 800,000.00 (in words: eight hundred thousand euro) is to be made. The Purchasers are
entitled to settle from this amount by way of offsetting against the purchase price, all taxes and levies owed by Euroreal Verwaltungsgebäude and/or Euroreal Produktionsgebäude along with other debts not, or not completely, taken into
account in the “Proforma Statement” as per 30 September 2005 to be produced for each of the companies, these taxes and levies relating to the period up to the transfer reference date and for which the Seller has not in the respective
“Proforma Statements” as per 30 September 2005 shown any reserves with the effect of reducing equity capital. Any amount remaining after these debts are settled is to be paid into the Seller’s account as detailed in the next
sub-paragraph, after that point in time at which the corresponding taxes or levies, or amounts of liability, have been determined finally (and materially) to be legally valid in respect of Euroreal Verwaltungsgebäude or Euroreal
Produktionsgebäude, as the case may be. 

  
 The Seller is entitled to request that the retained amount of EUR 800,000.00 be paid out on submission of a tax and levies statement (also) subject to inspection, in respect of the two companies being sold off here, conditionally on the
Seller providing for the Purchasers a directly liable banker’s guarantee without limit of time, issued by a financial institution subject to German banking supervision. This guarantee shall expire as soon as the statements on taxes and levies
become final and materially legally valid. 
  
 The amount
remaining after deduction of the amounts specified in the two preceding sub-paragraphs is to be paid 

 
into an account of the Seller still to be notified, held with Commerzbank AG, Bad Homburg (Sort Code 500 400 00), subject to the conditions set out in §
4 Section 4.” 
  

	7.	§ 5 Section 4 page 2 of the Production Building Purchase Contract is reworded as follows: 

  
 “The remaining amount is to be paid into an account of the Seller still to be notified, held with Commerzbank AG, Bad
Homburg (Sort Code 500 400 00), subject to the conditions set out in § 4 Section 4.” 
  

	8.	The Purchasers provide the Seller with an undertaking that they will produce, submit and, if relevant, appeal in respect of the annual accounts for 2005 and tax declarations for the
period of time up to the transfer reference date. The Purchasers are obliged to impose the above-mentioned obligation on any subsequent legal successor. In the event of differences of opinion, the matter will be decided by the neutral auditor to be
nominated jointly by the two sides. The stipulated arrangement for the binding calculation of the definitive purchase prices shall apply correspondingly. 

  
 III. 
 Seller’s affirmation 
  
 The Seller provides the following
affirmation: 
  
 The Control Contract and Profit Transfer Agreement concluded on
15 November 2004 between Euroreal Holding Projekt Mainz Hechtsheimerstrasse GmbH and Euroreal Mainz Verwaltungsgebäude Hechtsheimerstrasse GmbH (designated erroneously in the last-mentioned contract as “Euroreal Mainz
Verwaltungsgebäude GmbH”) was cancelled on 

 
31 December 2004. A copy of the Cancellation Agreement is attached to this deed. It fully and correctly sets out the agreements reached between the
parties on this date. The above-mentioned Control Contract and Profit Transfer Agreement was subject to a condition precedent which did not come into effect. Accordingly, the above-mentioned Control Contract and Profit Transfer Agreement of
15 November 2004 remains in force to the present day, along with the arrangements stipulated therein. 
  
 IV. 
 Miscellaneous 
  
 All formal approvals shall become effective on being received by the authenticating notary.

  
 The parties involved expressly confirm that under their own responsibility
they have had the above-mentioned set of contracts checked by their legal advisers, from the commercial point of view and also, in particular, in respect of fiscal law and the law on contracts. 
  
 The above Agreement and Annexe were read out to the parties present by the Notary,
approved by them and signed in their own hand, by themselves and the Notary, as below: 
  

	
	
	  
	(signatures)

  
 Cancellation Agreement

  
 between the limited liability company operating under the business
name of Euroreal Holding Projekt Mainz Hechtsheimerstrasse GmbH with its head office in Cologne, 
  
 - as the Controlling Company - 
  
 and the limited liability company operating under the business name of Euroreal Mainz Verwaltungsgebäude GmbH with its head office in Cologne, 
  
 - as the Controlled Company - 
  
 The Control Contract and Profit Transfer Agreement concluded on 15 November 2004 is cancelled on substantive grounds due to the intention to sell off the Controlled
Company under the condition precedent of transfer of the shares in the company. This breaches no rights of any third parties. 
  
 If any individual provisions in this Contract should be, or become, invalid, this in no way affects the validity of the Contract as a whole. Both Parties to the Contract
shall replace the invalid provision with another provision which as closely as possible approximates the commercial intent of the invalid provision. 
  
 Cologne, 31 December 2004 
  

	
	(signature)
	
	 
	Euroreal Holding Projekt Mainz
	Hechtsheimerstrasse GmbH

	
	(signature)
	
	 
	Euroreal Mainz Verwaltungsgebäude GmbH

  
 As Annexe to the Deed of this day 
 - Deed No. 17231 2005 of the Notary 
 Wolfgang Gruntkowski in Cologne 
 Cologne, 19 October 2005 
  

	
	
	  
	(signatures)

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