Document:

CONTRIBUTION
      AND CONVEYANCE AGREEMENT

     

    THIS
      CONTRIBUTION AND CONVEYANCE AGREEMENT (this “Agreement”), dated as of June 26,
      2008, by and between ARBOR NATIONAL CJ, LLC, a New York limited liability
      company (“Transferor”), and LIGHTSTONE VALUE PLUS REIT, L.P., a Delaware limited
      partnership (“Transferee”).

     

    WITNESSETH:

     

    WHEREAS,
      Transferor owns a Class A membership interest in MILL RUN L.L.C., a Delaware
      limited liability company (the “Company”), corresponding to a 0.46% Common
      Interest (as defined in the Mill Run Operating Agreement), pursuant to that
      certain Second Amended and Restated Operating Agreement of the Company, dated
      as
      of September 20, 2005 (as amended by a First Amendment dated as of January
      1,
      2006, the “Mill Run Operating Agreement”); and

     

    WHEREAS,
      in consideration of Transferor’s transferring the Transferred Interests (as
      defined below) herewith to Transferee, Transferee shall issue to Transferor
      2,000 units of common limited partnership interest in Transferee (“Common
      Units”) and 380 units of Series A preferred limited partnership interest in
      Transferee (“Series A Units”, and collectively with the Common Units, the
“Units”); and 

     

    WHEREAS,
      Transferor has delivered on the date hereof a completed Representation Letter
      and Agreement in the form attached as Exhibit
      A
      hereto;
      and

     

    WHEREAS,
      in consideration of the receipt by Transferor of the Units, and the execution
      and delivery by Transferee of a Tax Protection Agreement in
      the
      form attached as Exhibit
      B
      hereto
      (the “Tax Protection Agreement”), Transferor desires to transfer and assign to
      Transferee all of Transferor’s right, title and interest (x) in the Company and
      (y) under the Mill Run Operating Agreement (collectively, the “Transferred
      Interests”), and Transferee desires to accept such transfer and assignment, all
      upon the terms and conditions hereinafter set forth; and

     

    WHEREAS,
      concurrently with the execution and delivery of this Agreement, Transferor,
      Transferee and Lightstone Value Plus Real Estate Investment Trust, Inc. (the
      “REIT”) are entering into an Exchange Rights Agreement with respect to the
      exchange of Transferor’s Common Units (including units received upon conversion
      of Series A Units) for cash or stock in the REIT (the “Exchange Rights
      Agreement”); and

     

    WHEREAS,
      for federal income tax purposes, it is intended that the transfer of the
      Transferred Interests will be treated as a tax-free contribution by Transferor
      to Transferee of the Transferred Interests in exchange for the Units under
      Section 721 of the Internal Revenue Code of 1986, as amended (the “Code”);
      and

     

    WHEREAS,
      concurrently with the transfer and assignment of the Transferred Interests
      to
      Transferee, Transferor is withdrawing as a member of the Company.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    NOW,
      THEREFORE, the parties covenant and agree as follows:

     

    1. Contribution
      and Transfer.
      

     

    (a) For
      and
      in consideration of the issuance by Transferee to Transferor of the Units,
      Transferor hereby contributes and assigns to Transferee all of Transferor’s
      right, title and interest in and to the Transferred Interests, including,
      without limitation, all of Transferor’s rights and interest in all profits,
      losses, Cash Flow, Capital Proceeds (as such terms are defined in the Mill
      Run
      Operating Agreement), distributions and capital of the Company with respect
      to
      such Transferred Interests, except that the Transferor is retaining all right
      to
      distributions previously paid and allocations made by the Company on account
      of
      the Transferred Interests prior to the date hereof. In connection with its
      receipt of the Units, Transferor agrees to be bound by and comply with the
      terms
      of the Amended and Restated Agreement of Limited Partnership of Transferee
      dated
      as of April 22, 2005, as amended by the First Amendment to the Amended and
      Restated Agreement of Limited Partnership of Transferee, dated as of the date
      hereof (as so amended, the “Partnership Agreement”), and delivers herewith an
      executed counterpart of the Partnership Agreement.

     

    (b) Transferee
      hereby accepts Transferor’s contribution, transfer and assignment of the
      Transferred Interests.

     

    (c) Transferor
      hereby withdraws as a Member of the Company and grants Transferee the right
      to
      be admitted as a substitute member of the Company in Transferor’s place in
      accordance with the terms of the Mill Run Operating Agreement.

     

    (d) The
      Company hereby admits Transferee as a substitute member of the Company in
      Transferor’s place.

     

    2. Representations
      and Warranties.
      

     

    (a) Transferor
      hereby represents and warrants to Transferee that (i) Transferor is the sole
      legal and beneficial owner of the Transferred Interests; (ii) Transferor has
      not
      previously assigned, transferred, sold, pledged or otherwise disposed of or
      hypothecated the Transferred Interests or any portion thereof or interest
      therein, except for the granting of any security interests therein which have
      been released on or prior to the date hereof; (iii) the Transferred Interests
      transferred hereby are free and clear of any liens, security interests and
      other
      encumbrances, except for those, if any, arising under the Mill Run Operating
      Agreement; (iv) the execution of, and the transfer and assignment of the
      Transferred Interests pursuant to, this Agreement have been authorized by all
      necessary action on the part of Transferor; (v) Transferor has the full
      right, power and authority to execute and deliver this Agreement and to perform
      its obligations hereunder, without obtaining any consents or approvals from,
      or
      taking any actions with respect to, any governmental authorities or other third
      parties; (vi)  this Agreement has been duly and validly executed and
      delivered by Transferor and, when executed and delivered by Transferee, will
      constitute the valid and binding agreement of Transferor, enforceable against
      Transferor in accordance with its respective terms; and (vii) the execution
      and
      delivery by Transferor of this Agreement and the performance of Transferor’s
      obligations hereunder and the transaction contemplated hereby do not violate
      or
      conflict with the governing documents of Transferor, or, subject to the
      approvals of the Members of the Company, any other instrument or agreement
      to
      which Transferor is a party; provided,
      however,
      that
      notwithstanding anything herein to the contrary, Transferor is not making any
      representation or warranty as to whether any third party consents are or are
      not
      required under any loan or other financing agreements, mortgages or other
      instruments or agreements to which the Company or any entity directly or
      indirectly owned by the Company is a party, or by which any real or personal
      property owned by the Company or by any entity directly or indirectly owned
      by
      the Company is subject or encumbered.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    (b) Transferee
      hereby represents and warrants to Transferor that: (i) the execution of this
      Agreement, the Tax Protection Agreement, the Partnership Agreement and the
      Exchange Rights Agreement, and the issuance of the Units to Transferor, have
      been authorized by all necessary action on the part of Transferee and the REIT,
      as applicable; (ii) each of Transferee and the REIT, as applicable, has full
      right, power and authority to execute, deliver and perform this Agreement,
      the
      Tax Protection Agreement, the Partnership Agreement and the Exchange Rights
      Agreement without obtaining any consents or approvals from, or taking any
      actions with respect to, any governmental authorities or other third parties;
      (iii) this Agreement, the
      Tax
      Protection Agreement, the Partnership Agreement and the Exchange Rights
      Agreement have
      been
      duly and validly executed and delivered by Transferee and the REIT, as
      applicable, and, when executed and delivered by Transferor, will constitute
      the
      valid and binding agreement of Transferee and the REIT, as applicable,
      enforceable against Transferee and the REIT, as applicable, in accordance with
      their respective terms; (iv) a true and complete copy of the Partnership
      Agreement (including Exhibit A thereto updated to reflect the transactions
      contemplated by this Agreement and any other transactions involving the
      Transferee that are consummated on or prior to the date hereof) is attached
      hereto as Exhibit C,
      and the
      Partnership Agreement has been duly executed and delivered by all parties
      thereto, is in full force and effect, and is binding and enforceable in
      accordance with its terms; (v) after giving effect to the transactions
      contemplated by this Agreement and any other transactions involving the
      Transferee that are consummated on or prior to the date hereof, the
      capitalization of Transferee (including the number of each class and series
      of
      units issued by Transferee and the related capital contributed with respect
      to
      such units) is set forth on Exhibit
      D
      hereto;
      (vi) the execution and delivery by each of Transferee and the REIT of this
      Agreement, the Tax Protection Agreement, the Partnership Agreement and the
      Exchange Rights Agreement and the performance of the obligations of Transferee
      and the REIT hereunder and thereunder and the transaction contemplated hereby
      and thereby do not violate or conflict with the governing documents of
      Transferee or the REIT or any other instrument or agreement to which either
      of
      them is a party, as the case may be (vii) on the date hereof immediately after
      the closing of the transfer and contribution by Transferor to Transferee
      described in Section 1 of this Agreement: (1) Transferor is
      simultaneously herewith being admitted as a limited partner in Transferee with
      respect to the Units; (2) the 704(b) “book” capital account of Transferor
      in Transferee is equal to $400,000; and (3) the Units have been duly issued
      to the Transferor and are fully paid and Transferor has no further obligation
      to
      contribute any amounts to the capital of Transferee or to reimburse Transferee
      for any expenses in respect of the Units; (viii) since
      May
      23, 2005, the REIT, has been subject to the reporting requirements of Section
      13
      or 15 of the Securities Exchange Act of 1934, as amended, and the rules and
      regulations promulgated thereunder (the “1934 Act”) and has filed with the
      Securities and Exchange Commission (“SEC”) all documents required to be filed
      under the Securities Act of 1933, as amended, and the rules and regulations
      promulgated thereunder (the “1933 Act”), and the 1934 Act (the “REIT SEC
      Documents”); (ix) as of their respective dates, the REIT SEC Documents complied
      in all material respects with the requirements of the 1933 Act and the 1934
      Act,
      as the case may be, and none of the REIT SEC Documents contained any untrue
      statement of a material fact or omitted a material fact required to be stated
      therein or necessary to make the statements therein, in light of the
      circumstances under which they were made, not misleading, taking into account
      all corrections made by the REIT in subsequent filings with the SEC through
      the
      date of this Agreement; (x) the prospectus of the REIT dated January 23, 2008
      and the supplements thereto do not contain any untrue statement of material
      fact
      or omit a material fact required to be stated therein or necessary to make
      the
      statements therein, in light of the circumstance under which they were made,
      not
      misleading as of the date hereof; (xi) as of their respective dates, the
      consolidated financial statements of the REIT included in the REIT SEC Documents
      complied as to form in all material respects with then applicable accounting
      requirements and the published rules and regulations of the SEC with respect
      thereto, were prepared in accordance with generally accepted accounting
      principles applied on a consistent basis during the periods involved (except
      as
      may be indicated therein or in the notes thereto) and fairly presented the
      consolidated financial position of the REIT and its consolidated subsidiaries
      as
      at the dates thereof and the consolidated results of their operations and
      statements of cash flows for the periods covered by such statements (subject,
      in
      the case of unaudited statements, to normal year-end audit adjustments and
      to
      any other adjustments described therein); and (xii) neither Transferee nor
      the
      REIT have entered into or is a party to any instrument or agreement with any
      limited partner of Transferee which grants registration rights with respect
      to
      shares in the REIT which such limited partner may own or acquire.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    (c) Transferee
      hereby acknowledges, represents and warrants that it is not relying on any
      information, representations or warranties furnished or made by Transferor
      or
      any of Transferor’s representatives or agents as to any matter whatsoever
      concerning the Company or any entity that is directly or indirectly owned by
      the
      Company or in which the Company has any direct or indirect interest (including,
      without limitation, the legal status, good standing, organizational documents,
      business, prospects, assets, liabilities, financial condition or operations
      of,
      or the need for any third party consents to the transactions contemplated by
      this Agreement from any lenders to or other persons having any contractual
      relationship with or jurisdiction over, the Company or such other entity),
      or
      any matter (including, without limitation, physical condition, operating
      results, financing, liabilities, title, encumbrances, leases, zoning status,
      compliance with law, prospects and compliance with mortgages and other
      instruments and agreements) relating to any properties in which any of the
      Company or such other entities have a direct or indirect interest, and in
      entering into this Agreement and in accepting the Transferred Interests,
      Transferee is not relying upon any representations or warranties of Transferor
      or any of its representatives or agents whatsoever, except for the
      representations of Transferor expressly set forth in Section 2(a) hereof.
      Transferee further acknowledges, represents, warrants and covenants that in
      entering into this Agreement and in accepting the Transferred Interests, it
      is
      relying solely on its own independent investigation and due diligence with
      respect to the Company and any entity or property in which the Company has
      a
      direct or indirect interest, and Transferee further agrees that Transferee
      shall
      not seek to hold Transferor responsible or liable in any way for or in
      connection with any representations or warranties or other information furnished
      to Transferee by any person or entity, other than the representations and
      warranties of Transferor expressly set forth in Section 2(a)
      hereof.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    3. Release.
      

     

    (a) Transferor
      hereby releases and discharges Transferee,
      BRM LLC, a New Jersey limited liability company, and the Company and their
      respective past, present and future subsidiaries, directors, officers, partners,
      shareholders, members, managers, affiliates, employees, beneficiaries, agents,
      representatives, predecessors, successors and assigns (collectively, “Transferee
      Releasees”) from any claims, liabilities, obligations, causes of action, suits,
      debts, accounts, reckonings, contracts, agreements, promises, covenants,
      damages, costs (including costs of suit and attorneys’ fees and expenses) and
      demands (collectively, “Claims”) of whatever nature, character, type or
      description, whether contingent, known or unknown, liquidated or unliquidated,
      at law or in equity, which Transferor or its affiliates now
      has,
      has ever had or may hereafter claim to have against the Transferee Releasees,
      provided that such release and discharge is specifically limited to only those
      Claims that are on account of, relating to or arising from or under the
      Company,
      the
      Transferred Interests or the Mill Run Operating Agreement. In amplification,
      and
      not in limitation, of the foregoing, BRM LLC and the Company are hereby released
      by Transferor from, among other things, any obligation or liability to make
      any
      further distributions to Transferor. The release herein given shall be and
      remain in effect as a full and complete release notwithstanding the discovery
      or
      existence of any such additional or different claims or facts.

     

    (b) Transferee
      and the Company hereby
      release and discharge Transferor
      and its respective past, present and future subsidiaries, directors, officers,
      partners, shareholders, members, managers, affiliates, employees, beneficiaries,
      agents, predecessors, representatives, successors and assigns (collectively,
      “Transferor Releasees”) from any Claims, of whatever nature, character, type or
      description, whether contingent, known or unknown, liquidated or unliquidated,
      at law or in equity, which Transferee or the Company now has, has ever had
      or
      may hereafter claim to have against the Transferor Releasees, provided that
      such
      release and discharge is specifically limited to only those Claims that are
      on
      account of, relating to or arising from or under the Company,
      the
      Transferred Interests or the Mill Run Operating Agreement. In amplification,
      and
      not in limitation, of the foregoing, Transferor is hereby released by Transferee
      and the Company from, among other things, any obligation or liability to make
      any capital contributions to the Company or to return to the Company all or
      any
      portion of any distributions previously made to it by the Company. The release
      herein given shall be and remain in effect as a full and complete release
      notwithstanding the discovery or existence of any such additional or different
      claims or facts.

     

    (c) Notwithstanding
      anything in this Section 3 to the contrary, in no event shall either Transferor
      or Transferee or their respective affiliates, be deemed to release, discharge
      or
      waive, pursuant to this Section 3 or any other provision of this Agreement,
      any
      Claim against the other party (or its affiliates) that is not on account of,
      relating to or arising from or under the Company, the Transferred Interests
      or
      the Mill Run Operating Agreement (“Unrelated Claims”), and all such Unrelated
      Claims are hereby fully preserved and reserved in all respects, and all such
      Unrelated Claims remain in full force and effect. In amplification, and not
      in
      limitation, of the foregoing, all rights, remedies, covenants and obligations
      of
      the parties under this Agreement and under the documents and agreements attached
      as Exhibit
      A,
      Exhibit
      B
      and
Exhibit
      C
      hereto
      (i) are hereby deemed to be Unrelated Claims, (ii) are not modified in any
      manner by the release provisions set forth in this Section 3, and (iii) remain
      in full force and effect.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    4. Indemnification. 

     

    (a) Transferee
      shall defend, indemnify and hold harmless Transferor from and against any and
      all loss, liability, damage, cost or expense (including, without limitation,
      reasonable attorneys’ fees and disbursements) incurred or sustained by
      Transferor on account of (i) any breach of any representation, warranty or
      covenant of Transferee set forth herein, or (ii) the Transferred Interests,
      provided and to the extent that such loss, liability, damage or cost accrues
      on
      or after the date hereof.

     

    (b) Transferor
      shall defend, indemnify and hold harmless Transferee from and against any and
      all loss, liability, damage, cost or expense (including, without limitation,
      reasonable attorneys’ fees and disbursements) incurred or sustained by
      Transferee on account of any breach of any representation, warranty or covenant
      of Transferor set forth herein, provided and to the extent that such loss,
      liability, damage or cost accrues on or after the date hereof.

     

    5. Initial
      Unit Distributions; Unit Redemption.
      Transferor and Transferee acknowledge and agree that the first quarterly
      distribution paid by Transferee in respect of the Series A Units shall (a)
      be
      with respect to the quarter ending June 30, 2008, and (b) be prorated based
      on
      the number of days during such quarter after the date hereof. Transferor
      acknowledges that notwithstanding anything to the contrary herein or in the
      Partnership Agreement, Transferor shall not have the right to convert or redeem
      any Series A Units prior to June 26, 2013.

     

    6. Tax
      Reporting; Audits.
      For
      federal, state, and local income tax purposes, Transferee shall report
      Transferor’s contribution of the Transferred Interests to Transferee as a
      tax-free contribution pursuant to Section 721 of the Code (or the corresponding
      provision of state or local law, as applicable). Notwithstanding anything to
      the
      contrary in this Agreement or the Partnership Agreement, neither Transferee
      nor
      the REIT shall settle any matter that involves the tax treatment of (i) the
      contribution of the Transferred Interests or (ii) any other matter that would
      have a tax impact on Transferor that is materially, adversely different from
      the
      tax impact such matter would have on the REIT, without the prior written consent
      of Transferor, which consent shall not be unreasonably withheld.

     

    7. Registration
      Rights.
      Each of
      Transferee and the REIT agrees that in the event that either of them enters
      into
      or becomes a party to any instrument or agreement with any limited partner
      of
      Transferee which grants registration rights with respect to shares in the REIT
      which such limited partner may own or acquire, or otherwise grants such
      registration rights to any limited partner of Transferee, then each of
      Transferee and the REIT shall promptly notify Transferor and shall grant to
      Transferor, by entering into a registration rights agreement with Transferor
      that is in form and substance reasonably acceptable to Transferor, registration
      rights with respect to any shares issued by the REIT that Transferor may acquire
      in connection with a transfer or redemption of any of its Units to or by
      Transferee or the REIT, and such registration rights shall be on terms that
      are
      no less favorable to Transferor in any respect than the most favorable
      registration rights granted to any other limited partner of Transferee by
      Transferee or the REIT. 

     

    8. Further
      Assurances.
      Each
      party to this Agreement will execute, acknowledge and deliver, or cause to
      be
      executed, acknowledged and delivered, any such further conveyances, assignments,
      approvals, consents and other documents, and do any other acts, as may be
      reasonably necessary to carry out the intent and purpose of this Agreement.
      Without limiting the generality of the foregoing, if any property, assets,
      collateral, funds, documents or other items which constitute a part of the
      Transferred Interests remains in or comes into either Transferor’s possession or
      control or remains or become vested or titled in Transferor, Transferor shall
      promptly take any and all actions necessary to transfer title and possession
      thereof to Transferee, all at Transferee’s sole cost and expense.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    9. Governing
      Law.
      This
      Agreement shall be construed and enforced in accordance with the laws of the
      State of New York.

     

    10. Binding
      Effect.
      This
      Agreement shall be binding upon, and shall inure to the benefit of, Transferor,
      Transferee and their respective successors and assigns.

     

    11. Severability.
      In the
      event that any phrase, clause, sentence, paragraph, section, article or other
      portion of this Agreement shall become illegal, null or void, or against public
      policy, for any reason, or shall be held by any court of competent jurisdiction
      to be illegal, null or void, or against public policy, the remaining portions
      of
      this Agreement shall not be affected thereby and shall remain in force and
      effect to the full extent permissible by law.

     

    12. Counterparts.
      This
      Agreement may be executed in several counterparts, each of which shall
      constitute an original and all of which, taken together, shall constitute one
      and the same Agreement, binding on each party hereto.

     

    [REMAINDER
      OF PAGE INTENTIONALLY LEFT BLANK]

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, Transferor
      and Transferee have executed this Agreement as of the date first above
      written.

     

    
      	 	 	 
	 	
              TRANSFEROR: 

               

              ARBOR
                NATIONAL CJ, LLC,
                

              
                a
                  New York limited liability company 

                By:
                  Arbor Commercial Mortgage, LLC, a
                  New York limited liability company, its
                  sole member

              

            
	 
 	 
 	 
 
	
            	
            	
              By:

            
	 	
              
                
Name:

            
	 	
              Title:

            

    

     

    
      	 	 	 
	 	
              TRANSFEREE:

               

              
                LIGHTSTONE
                  VALUE PLUS REIT, L.P., 

                a
                  Delaware limited partnership

                By
                   Lightstone
                  Value Plus Real Estate Investment Trust,
                  Inc., a Maryland corporation, its general partner

              

            
	 
 	 
 	 
 
	
            	
            	
              By:

            
	 	
              
                
Name:

            
	 	
              Title:

            

    

     

     

    MILL
      RUN
      L.L.C. is executing this 

    Agreement
      for the sole purpose of 

    Sections
      1(d) and 3(b) hereof.

    

    MILL
      RUN
      L.L.C.

    By:
      BRM
      LLC, its managing member

    

    
      	 	 	 	 
	
              By:

            	 	 	
            
	
              
                

              

              Name:

              Title:

            	 	 	
            

    

     

    [SIGNATURES
      CONTINUE ON NEXT PAGE]

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    LIGHTSTONE
      VALUE PLUS REAL 

    ESTATE
      INVESTMENT TRUST, INC.,

    is
      executing this agreement for the sole 

    purpose
      of Sections 6 and 7 hereof.

    

    LIGHTSTONE
      VALUE PLUS REAL 

    ESTATE
      INVESTMENT TRUST, INC.,

    a
      Maryland Corporation

     

    
      	 	 	 	 
	By:	 	 	
            
	
              
                

              

              Name:

              Title:

            	 	 	
            

    

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

    EXHIBIT
      A

     

    REPRESENTATION
      LETTER AND AGREEMENT

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    EXHIBIT
      B

     

    TAX
      PROTECTION AGREEMENT

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    EXHIBIT
      C

     

    PARTNERSHIP
      AGREEMENT

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    EXHIBIT
      D

     

    CAPITALIZATION
      OF TRANSFEREECONTRIBUTION
      AND CONVEYANCE AGREEMENT

     

    THIS
      CONTRIBUTION AND CONVEYANCE AGREEMENT (this “Agreement”),
      dated
      as of June 26, 2008, by and among AR PRIME HOLDINGS LLC, a Delaware limited
      liability company (“Transferor”),
      LIGHTSTONE VALUE PLUS REIT, L.P., a Delaware limited partnership (“Transferee”),
      and
      LIGHTSTONE VALUE PLUS REAL ESTATE INVESTMENT TRUST, INC., a Maryland corporation
      (the “REIT”).

     

    WITNESSETH:

     

    WHEREAS,
      Transferor owns a membership interest (the “Interest”)
      in
      Prime Outlets Acquisition Company LLC, a Delaware limited liability company
      (the
“Company”),
      corresponding to a 25% Percentage of Membership Interest (as defined in the
      POAC
      Operating Agreement), pursuant to that certain Amended and Restated Limited
      Liability Company Agreement of the Company, dated as of December 11, 2003,
      as
      amended by the Amendment to the Amended and Restated Limited Liability Company
      Agreement of the Company, dated as of September 2007 (the “POAC
      Operating Agreement”);

     

    WHEREAS,
      Transferor and Transferee desire to enter into a transaction whereby Transferor
      shall transfer the Interest to Transferee in exchange for certain units of
      limited partnership interest in Transferee;

     

    WHEREAS,
      for federal income tax purposes, it is intended that the transfer of the
      Interest will be treated as a tax-free contribution by Transferor to Transferee
      of the Interest in exchange for the Units (as defined below) under Section
      721
      of the Internal Revenue Code of 1986, as amended (the “Code”);
      

     

    WHEREAS,
      concurrently with the execution and delivery of this Agreement, Transferor,
      Transferee and the Company are entering into a tax protection agreement with
      respect to the sale or other disposition of properties indirectly owned by
      the
      Company (the “Tax
      Protection Agreement”);

     

    WHEREAS,
      the REIT is the sole general partner of Transferee; and

     

    WHEREAS,
      the members of the Company have executed and delivered the Consent to Transfer,
      Substitution and Withdrawal in the form attached hereto as Exhibit
      I;

     

    NOW,
      THEREFORE, for good and valuable consideration, the receipt and sufficiency
      of
      which is hereby acknowledged, the parties covenant and agree as
      follows:

     

    1. Contribution
      and Transfer; Additional Loan.
      Subject
      to the terms and conditions of this Agreement, at the Closing (as defined
      below):

     

    (a)Transferor
      shall contribute and assign to Transferee all of Transferor’s right, title and
      interest in and to the Interest, including, without limitation, all of
      Transferor’s rights and interest in all profits, losses, Net Cash Receipts,
      Capital Proceeds (as such terms are defined in the POAC Operating Agreement),
      distributions and capital of the Company with respect to the Interest, free
      and
      clear of any liens, security interests and any other encumbrances (except for
      those, if any, arising under the POAC Operating Agreement), in exchange for
      the
      issuance to Transferor by Transferee of:

     

    (i) subject
      to Section 4(d), a number of units of common limited partnership interest in
      Transferee ( “Common
      Units”)
      equal
      to (x) the Initial Common Amount (as defined below), divided by (y) $10
      (the
“Base
      Common Units”);

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (ii) a
      number
      of units of Series A preferred limited partnership interest in Transferee
      (“Series
      A Units”)
      having
      an aggregate liquidation preference equal to the Initial Preferred Amount (as
      defined below) (the “Base
      Preferred Units”
and,
      together with the Base Common Units, the “Base
      Units”);

     

    (iii) subject
      to Section 4(d), a number of Common Units equal to (x) the Additional Common
      Amount (as defined below), divided by (y) $10 (the “Additional
      Common Units”);
      and

     

    (iv) a
      number
      of Series A Units having an aggregate liquidation preference equal to the
      Additional Preferred Amount (as defined below) (the “Additional
      Preferred Units”
and,
      together with the Additional Common Units, the “Additional
      Units”)
      (the
      Base Units and the Additional Units are collectively referred to herein as
      the
“Units”);

     

    provided,
      however,
      that
      notwithstanding the foregoing, Transferor shall retain all right to
      distributions paid and allocations made by the Company on account of the
      Interest prior to the Closing; 

     

    (b)
      Transferee
      shall issue the Units to Transferor in exchange for Transferor’s contribution of
      the Interest to Transferee; 

     

    (c)
      The
      REIT
      shall make a loan to Transferor in an amount equal to 90% of the Additional
      Amount (as defined below) (the “Additional
      Loan”),
      which
      shall be advanced to Transferor on the Closing Date in immediately available
      funds; and

     

    (d)
      Upon
      the
      contribution of the Interest to Transferee, (i) Transferee shall, upon
      compliance with the conditions for substitution as a member set forth in the
      POAC Operating Agreement, be admitted as a Member (as defined in the POAC
      Operating Agreement) of the Company in substitution for Transferor in accordance
      with the POAC Operating Agreement, and (ii) Transferee shall agree to be bound
      by the POAC Operating Agreement as a Member in place of Transferor.

     

    2. Representations
      and Warranties.
      

     

    (a)
      Transferor
      hereby represents and warrants to Transferee and the REIT that:

     

    (i) Transferor
      is the sole legal and beneficial owner of the Interest, subject to a security
      interest in favor of the REIT;

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    (ii) Transferor
      has not previously assigned, transferred, sold, pledged or otherwise disposed
      of
      or hypothecated the Interest or any portion thereof or interest therein, except
      for the granting of any security interests therein which have been released
      on
      or prior to the date hereof and the grant of a security interest therein to
      the
      REIT;

     

    (iii) as
      of the
      execution hereof the Interest is free and clear of any liens, security interests
      and other encumbrances, except for those, if any, arising under the POAC
      Operating Agreement and for a security
      interest in favor of the REIT;

     

    (iv) the
      execution of, and the transfer and assignment of the Interest pursuant to,
      this
      Agreement have been authorized by all necessary action on the part of
      Transferor;

     

    (v) at
      the
      Closing, the Transferor shall have record and beneficial ownership in and to
      the
      Interest, free and clear of any liens, security interests or any other
      encumbrances, except for (A) those, if any, arising under the POAC Operating
      Agreement, and (B) a security interest in favor of the REIT; 

     

    (vi) Transferor
      has the full right, power and authority to execute and deliver this Agreement
      and the Transferor Closing Documents, and to perform its obligations hereunder
      and thereunder, without obtaining any consents or approvals from, or taking
      any
      actions with respect to, any governmental authorities or other third
      parties,
      except
      for the approvals of the Members of the Company;
      and

     

    (vii) this
      Agreement has been, and at the Closing the Transferor Closing Documents will
      be,
      duly and validly executed and delivered by Transferor and, when executed and
      delivered by Transferee, will constitute the valid and binding agreements of
      Transferor, enforceable against Transferor in accordance with their respective
      terms; and

     

    (viii) the
      execution and delivery by Transferor of this Agreement and the Transferor
      Closing Documents and the performance of Transferor’s obligations thereunder and
      the transactions contemplated thereby do not violate or conflict with the
      governing documents of Transferor or, subject to the approvals of the Members
      of
      the Company, any other instrument or agreement to which Transferor is a
      party;

     

    provided,
      however,
      that
      notwithstanding anything herein to the contrary, Transferor is not making any
      representation or warranty as to whether any third party consents are or are
      not
      required under any loan or other financing agreements, mortgages or other
      instruments or agreements to which the Company or any entity directly or
      indirectly owned by the Company is a party or to or by which any real or
      personal property owned by the Company or by any entity directly or indirectly
      owned by the Company is subject or encumbered.

     

    (b)
      Each
      of
      Transferee and the REIT, jointly and severally, hereby represents and warrants
      to Transferor that: 

     

    (i) the
      execution of this Agreement and the Tax Protection Agreement, the issuance
      by
      Transferee of the Units to Transferor, and the making by the REIT of the
      Additional Loan, have been authorized by all necessary action on the part of
      Transferee and the REIT, as applicable;

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    (ii) each
      of
      Transferee and the REIT (as applicable) has the full right, power and authority
      to execute and deliver this Agreement, the Tax Protection Agreement and the
      Transferee Closing Documents, and to perform its obligations hereunder and
      thereunder, without obtaining any consents or approvals from, or taking any
      actions with respect to, any governmental authorities or other third
      parties;

     

    (iii) this
      Agreement and the Tax Protection Agreement have been, and at the Closing the
      Transferee Closing Documents will be, duly and validly executed and delivered
      by
      each of Transferee and the REIT (as applicable) and, when executed and delivered
      by Transferor, will constitute the valid and binding agreements of each of
      Transferee and the REIT (as applicable), enforceable against each of Transferee
      and the REIT (as applicable) in accordance with the respective terms of such
      agreements and Transferee Closing Documents;

     

    (iv) a
      true
      and complete copy of the Amended and Restated Agreement of Limited Partnership
      of Transferee, dated as of April 22, 2005, as amended by the First Amendment
      to
      the Amended and Restated Agreement of Limited Partnership of Transferee, dated
      as of the date hereof, (as so amended, the “Partnership
      Agreement”),
      is
      attached hereto as Annex
      I,
      and the
      Partnership Agreement has been duly executed and delivered by all parties
      thereto, is in full force and effect, and is binding and enforceable in
      accordance with its terms;

     

    (v) after
      giving effect to the transactions contemplated by this Agreement and any other
      transactions involving the Transferee that are consummated on or prior to the
      date hereof, the capitalization of Transferee (including the number of each
      class and series of units issued by Transferee and the related capital
      contributed with respect to such units) will be as set forth on Annex
      II
      hereto;

     

    (vi) at
      the
      Closing (as defined below):
      (A)
      the
      execution of the Exchange Rights Agreement (as defined below) will have been
      authorized by all necessary action on the part of Transferee and the REIT;
      (B)
      each of Transferee and the REIT will have full right, power and authority to
      execute, deliver and perform the Exchange Rights Agreement without obtaining
      any
      consents or approvals from, or taking any actions with respect to, any
      governmental authorities or other third parties; and (C) the Exchange Rights
      Agreement will have been duly and validly executed and delivered by each of
      Transferee and the REIT and, when executed and delivered by Transferor, will
      constitute the valid and binding agreement of each of Transferee and the REIT,
      enforceable against each of them in accordance with its terms; 

     

    (vii) the
      execution and delivery by each of Transferee and the REIT of this Agreement
      and
      the applicable Transferee Closing Documents and the performance of the
      obligations of Transferee and the REIT thereunder and the transactions
      contemplated thereby do not violate or conflict with the governing documents
      of
      Transferee or the REIT or any other instrument or agreement to which either
      of
      them is a party, as the case may be; 

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    (viii) immediately
      after the Closing: (1) Transferor will, simultaneously therewith, be
      admitted as a limited partner in Transferee with respect to the Units;
      (2) at the Closing, the 704(b) “book” capital account of Transferor in
      Transferee will be equal to the Total Amount (as defined below); and
      (3) the Units to be issued to the Transferor will be fully paid and
      Transferor will have no further obligation to contribute any amounts to the
      capital of Transferee or reimburse Transferee for any expenses in respect of
      the
      Units;

     

    (ix) since
      May
      23, 2005, the REIT has been subject to the reporting requirements of Section
      13
      or 15 of the Securities Exchange Act of 1934, as amended, and the rules and
      regulations promulgated thereunder (the “1934
      Act”)
      and
      has filed with the Securities and Exchange Commission (“SEC”)
      all
      documents required to be filed under the Securities Act of 1933, as amended,
      and
      the rules and regulations promulgated thereunder (the “1933
      Act”),
      and
      the 1934 Act (the “REIT
      SEC Documents”);

     

    (x) as
      of
      their respective dates, the REIT SEC Documents complied in all material respects
      with the requirements of the 1933 Act and the 1934 Act, as the case may be,
      and
      none of the REIT SEC Documents contained any untrue statement of a material
      fact
      or omitted a material fact required to be stated therein or necessary to make
      the statements therein, in light of the circumstances under which they were
      made, not misleading, taking into account all corrections made by the REIT
      in
      subsequent filings with the SEC through the date of this Agreement;

     

    (xi) the
      prospectus of the REIT dated January 23, 2008 and the supplements thereto do
      not
      contain any untrue statement of material fact or omit a material fact required
      to be stated therein or necessary to make the statements therein, in light
      of
      the circumstance under which they were made, not misleading as of the date
      hereof;

     

    (xii) as
      of
      their respective dates, the consolidated financial statements of the REIT
      included in the REIT SEC Documents complied as to form in all material respects
      with then applicable accounting requirements and the published rules and
      regulations of the SEC with respect thereto, were prepared in accordance with
      generally accepted accounting principles applied on a consistent basis during
      the periods involved (except as may be indicated therein or in the notes
      thereto) and fairly presented the consolidated financial position of the REIT
      and its consolidated subsidiaries as at the dates thereof and the consolidated
      results of their operations and statements of cash flows for the periods covered
      by such statements (subject, in the case of unaudited statements, to normal
      year-end audit adjustments and to any other adjustments described
      therein);

     

    (xiii) neither
      the REIT nor Transferee has entered into or is a party to any instrument or
      agreement granting any limited partner of Transferee registration rights with
      respect to shares of stock in the REIT which such limited partner may own or
      acquire; and

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    (xiv) the
      REIT
      has been organized and operated in conformity with the requirements for
      qualification and taxation as a “real estate investment trust” under Sections
      856 through 860 of the Code for all taxable years commencing with its taxable
      year of formation. The proposed method of operating of the REIT as described
      in
      the REIT SEC Documents will enable the REIT to continue to meet the requirements
      for qualification and taxation as a “real estate investment trust” under the
      Code. The REIT currently intends, and at the Closing the REIT will intend,
      to
      continue to operate in a manner which would permit it to qualify as a “real
      estate investment trust” under the Code. 

     

    (c)
      Each
      of
      Transferee and the REIT hereby acknowledges, represents and warrants that it
      is
      not relying on any information, representations or warranties furnished or
      made
      by Transferor or any of Transferor’s representatives or agents as to any matter
      whatsoever concerning the Company or any entity that is directly or indirectly
      owned by the Company or in which the Company has any direct or indirect interest
      (including, without limitation, the legal status, good standing, organizational
      documents, business, prospects, assets, liabilities, financial condition or
      operations of, or the need for any third party consents to the transactions
      contemplated by this Agreement from any lenders to or other persons having
      any
      contractual relationship with or jurisdiction over, the Company or such other
      entity), or any matter (including, without limitation, physical condition,
      operating results, financing, liabilities, title, encumbrances, leases, zoning
      status, compliance with law, prospects and compliance with mortgages and other
      instruments and agreements) relating to any properties in which any of the
      Company or such other entities have a direct or indirect interest, and in
      entering into this Agreement and (in the case of Transferee) in accepting the
      Interest at the Closing, each of Transferee and the REIT is not and will not
      be
      relying upon any representations or warranties of Transferor or any of its
      representatives or agents whatsoever, except for the representations of
      Transferor expressly set forth in Section 2(a) hereof. Each of Transferee and
      the REIT further acknowledges, represents, warrants and covenants that in
      entering into this Agreement and (in the case of Transferee) in accepting the
      Interest at the Closing, it is and will be relying solely on its own independent
      investigation and due diligence with respect to the Company and any entity
      or
      property in which the Company has a direct or indirect interest, and each of
      Transferee and the REIT further agrees that neither Transferee nor the REIT
      shall seek to hold Transferor responsible or liable in any way for or in
      connection with any representations or warranties or other information furnished
      to Transferee or the REIT by any person or entity, other than the
      representations and warranties of Transferor expressly set forth in Section
      2(a)
      hereof.

     

    3. Closing.

     

    (a)
      The
      closing of the transactions contemplated hereby (the “Closing”)
      shall
      occur at the New York offices of Cooley Godward Kronish LLP, counsel to the
      Transferor, at 10:00 am on the earlier of (i) the “Closing
      Deadline”,
      which
      shall initially be December 15, 2008, and (ii) a date designated by Transferee,
      by no less than fifteen (15) days’ prior written notice to Transferor, which
      date must be a business day and must be no later than thirty (30) days after
      the
      date on which Transferee has received audited financial statements for the
      Company for the years 2005, 2006 and 2007 (the “Audited
      Statements”);
      provided,
      however,
      that,
      if Transferee has not received the Audited Statements at least fifteen (15)
      days
      prior to the Closing Deadline, then Transferee shall have the right to extend
      the Closing Deadline, from time to time but no more than four times, by at
      least
      ten (10) days prior written notice to Transferor, to a date that is a business
      day and is not later than June 26, 2009. TIME SHALL BE OF THE ESSENCE with
      respect to the obligation of each of Transferor, Transferee and the REIT to
      close the transactions contemplated hereby no later than June 26, 2009,
      regardless of whether or not the Transferee has received the Audited Statements.
      The date on which the Closing occurs is referred to herein as the “Closing
      Date”.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    (b)
      At
      the
      Closing, Transferor shall execute and deliver to Transferee and/or the REIT
      (as indicated below) the following (the “Transferor
      Closing Documents”):

     

    (i) An
      instrument of assignment of the Interest, in the form annexed hereto as
Exhibit
      A
      (the
“Assignment”)
      (to
      Transferee);

     

    (ii) A
      representation letter and agreement, in the form annexed hereto as Exhibit
      B (the
      “Representation
      Letter and Agreement”)
      (to
      both Transferee and the REIT);

     

    (iii) A
      limited
      partner signature page to the Partnership Agreement (as defined below), in
      the
      form annexed hereto as Exhibit
      C
      (to
      Transferee);

     

    (iv) An
      exchange rights agreement, in the form annexed hereto as Exhibit
      D (the
      “Exchange
      Rights Agreement”)
      (to
      both Transferee and the REIT)

     

    (v) A
      mutual
      release agreement, in the form annexed hereto as Exhibit
      E (the
      “Release
      Agreement”)
      (to
      Transferee);

     

    (vi) A
      promissory note evidencing the Additional Loan,
      in the
      form annexed hereto as Exhibit
      F
      (the
“Additional
      Promissory Note”)
      (to
      the
      REIT);
      

     

    (vii) A
      pledge
      agreement, in the form annexed hereto as Exhibit
      G
      (the
“New
      Pledge Agreement”)
      (to
      the REIT);

     

    (viii) A
      certificate confirming the accuracy as of the Closing Date of the
      representations and warranties of Transferor set forth in Section 2(a) of this
      Agreement (to both Transferee and the REIT); and

     

    (ix) A
      certified copy of Transferor’s resolutions approving the transactions
      contemplated hereby (to both Transferee and the REIT).

     

    (c)
      At
      the
      Closing, the REIT shall advance to Transferor, in immediately available funds,
      the Additional Loan, and each of Transferee and the REIT (as applicable) shall
      execute and deliver to Transferor the following (together with the documents
      referred to in Section 3(d), collectively the “Transferee
      Closing Documents”):

     

    (i) The
      Assignment;

     

    (ii) The
      Representation Letter and Agreement;

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    (iii) An
      amended Exhibit A to the Partnership Agreement, naming Transferor as a limited
      partner of Transferee and indicating the number of Common Units and the number
      of Series A Units held by Transferor after the consummation of the transactions
      contemplated in this Agreement;

     

    (iv) A
      certificate evidencing action by the general partner of Transferee to issue
      the
      Units to Transferee, in the form annexed hereto as Exhibit
      H;

     

    (v) Certificates
      representing the Series A Units required to be issued to Transferor at
      Closing;

     

    (vi) The
      Exchange Rights Agreement;

     

    (vii) The
      Release Agreement; 

     

    (viii) The
      New
      Pledge Agreement;

     

    (ix) A
      certificate from each of the Transferee and the REIT confirming the accuracy
      as
      of the Closing Date of the representations and warranties set forth in Section
      2(b) of this Agreement; and

     

    (x) A
      certified copy of the resolutions adopted by the board of directors of the
      REIT
      approving, both for the REIT itself and in the REIT’s capacity as general
      partner of Transferee, the transactions contemplated hereby.

     

    (d) At
      the
      Closing, each of Transferee and the REIT shall cause:

     

    (i) Proskauer
      Rose LLP (or another nationally recognized tax counsel experienced in such
      matters and satisfactory to Transferor) to delivered to Transferor a tax
      opinion, addressed to Transferor, that, as of the Closing Date, the REIT
      qualifies as a real estate investment trust for U.S. federal income tax
      purposes;

     

    (ii) each
      of
      the Company and Lightstone Prime, LLC, a Delaware limited liability company
      (“Lightstone
      Prime”),
      to
      execute and deliver the Release Agreement; and

     

    (iii) any
      direct or indirect transferee of Lightstone Prime’s membership interest in the
      Company to execute and deliver a counterpart signature page to the Consent
      to
      Transfer, Substitution and Withdrawal annexed hereto as Exhibit
      I.

     

    4. Adjustments.

     

    (a)
      The
      “Initial
      Common Amount”
means
      an amount equal to $2,750,000. The “Initial
      Preferred Amount”
means
      an amount equal to (x) $52,250,000 minus (y) the aggregate amount of any
      distributions by the Company of Net Cash Receipts or Capital Proceeds (as such
      terms are defined in the POAC Operating Agreement) that are received by
      Transferor from the date of this agreement through the Closing Date, plus (z)
      the product of (i) 275,000 multiplied by (ii) the aggregate amount of any
      distributions per Common Unit that are declared or paid by the Partnership
      with
      a record date that is after the date of this Agreement but on or before the
      Closing Date. Neither the Initial Common Amount nor the Initial Preferred Amount
      shall be adjusted on account of Transferor’s contributed capital or capital
      account in the Company.

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    (b)
      The
      “Additional
      Amount”
means
      an amount equal to the aggregate distributions that would have accrued by the
      Closing Date on a number of
      Series A
      Units
      having
      an aggregate liquidation preference equal to $52,250,000, had such Series A
      Units been issued on the date of this Agreement. The “Additional
      Common Amount”
means
      an amount equal to 5% of the Additional Amount, and the “Additional
      Preferred Amount”
means
      an amount equal to 95% of the Additional Amount.

     

    (c)
      The
      “Total
      Amount”
means
      an amount equal to the sum of (w) the Initial Common Amount, (x) the Additional
      Common Amount, (y) the Initial Preferred Amount, and (z) the Additional
      Preferred Amount.

     

    (d)
      In
      the
      event that Transferee at any time or from time to time after the date hereof
      shall declare or pay any distribution on the Common Units payable in Common
      Units (or in any other securities or property other than cash, including without
      limitation the right to acquire Common Units), or shall effect a subdivision
      of
      the outstanding Common Units into a greater number of Common Units (by split,
      reclassification or otherwise), or in the event the outstanding Common Units
      shall be combined or consolidated, and so long as the record date for any of
      the
      foregoing is after the date of this Agreement but on or before the Closing
      Date,
      then the Base Common Units and the Additional Common Units to be issued pursuant
      to Sections 1(a)(i) and 1(a)(iii), respectively, shall be adjusted to equal
      the
      number of Common Units (and any other securities and property) that a limited
      partner of Transferee would have on the Closing Date had such limited partner
      been issued the Base Common Units and the Additional Units (before giving effect
      to the adjustments contemplated by this paragraph), as the case may be, on
      the
      date hereof.

     

    5. Closing
      Conditions.

     

    (a)
      Transferor’s
      obligations to consummate the transactions contemplated hereby and to deliver
      the Transferor Closing Documents at the Closing shall be conditioned upon the
      satisfaction of the following conditions (any of which may be waived by
      Transferor, in whole or in part) (the “Transferor
      Closing Conditions”):

     

    (i) The
      REIT
      shall advance the Additional Loan to Transferor in immediately available
      funds;

     

    (ii) Transferee
      and the REIT shall have tendered delivery, and shall have caused each of the
      persons referred to in Section 3(d), as applicable, to tender delivery, of
      all
      of the Transferee Closing Documents, including in each case a tender which
      may
      be conditioned on the satisfaction of the Transferee Closing Conditions (as
      defined below); and

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    (iii) Each
      of
      the representations and warranties of Transferee set forth in Section 2(b)
      of
      this Agreement must be accurate in all materials respects as of the Closing
      Date.

     

    (b)
      Transferee’s
      obligations to consummate the transactions contemplated hereby and to deliver
      (or cause the delivery of) the Transferee Closing Documents at the Closing,
      and
      the REIT’s obligation to advance the Additional Loan at the Closing, shall be
      conditioned upon the satisfaction of the following conditions (any of which
      may
      be waived by Transferee, in whole or in part) (the “Transferee
      Closing Conditions”):

     

    (i) Transferor
      shall have tendered delivery (including a tender which may be conditioned on
      the
      satisfaction of the Transferor Closing Conditions) of all of the Transferor
      Closing Documents; and

     

    (ii) Each
      of
      the representations and warranties of Transferor set forth in Section 2(a)
      of
      this Agreement must be accurate in all materials respects as of the Closing
      Date.

     

    (c)
      Transferee’s
      receipt of the Audited Statements is not a condition to Transferee’s obligation
      to consummate the transactions contemplated hereby at the Closing.

     

    6. Initial
      Unit Distributions; Unit Redemption.
      Transferor and Transferee acknowledge and agree that the first quarterly
      distribution paid by Transferee in respect of the Series A Units, after they
      are
      issued to Transferor, shall (a) be with respect to the quarter in which the
      Closing occurs and (b) be prorated based on the number of days during such
      quarter after the date of the Closing. Transferor acknowledges that
      notwithstanding anything to the contrary herein or in the Partnership Agreement,
      Transferor shall not have the right to convert any Series A Units to Common
      Units prior to June 26, 2013.

     

    7. Termination;
      Remedies.

     

    (a)
      If
      on the
      Closing Deadline (or any earlier date designated for the Closing in accordance
      with Section 3(a) hereof):

     

    (i) the
      Transferee Closing Conditions have been satisfied; and

     

    (ii) either
      of
      Transferee or the REIT shall fail or refuse to close the transactions
      contemplated hereby (including, in the case of the REIT, advancing the
      Additional Loan), whether due
      to
      the failure of Transferee to obtain the Audited Financials or
      for
      any other reason or for no reason; and

     

    (iii) Transferor
      is ready, willing and able to close the transactions contemplated hereby (or,
      in
      the event that any of the Transferor Closing Conditions shall not have been
      satisfied, Transferor would be ready, willing and able to close the transactions
      contemplated hereby but for such unsatisfied Transferor Closing
      Conditions),

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    then
      Transferor may elect one of the following as its sole and exclusive remedy:
      (x)
      to commence and prosecute an action for specific performance of Transferee’s
      obligations hereunder; or (y) to terminate this Agreement by
      written notice to Transferee,
      whereupon Transferee shall forthwith pay to Transferor the amount of $6,082,000
      as liquidated damages, and the parties hereto shall have no further rights
      or
      obligations to each other under this Agreement, except for Section 7(d) hereof;
      provided,
      however,
      that if
      the failure or refusal of Transferee or the REIT to close is due to the failure
      of Transferee to obtain the Audited Financials, then Transferor will be entitled
      to terminate this Agreement and receive liquidated damages from Transferee
      as
      provided by clause (y), above, but shall not be entitled to seek specific
      performance.

     

    (b)
      If
      on the
      Closing Deadline (or any earlier date designated for the Closing in accordance
      with Section 3(a) hereof):

     

    (i) the
      Transferor Closing Conditions have been satisfied; and

     

    (ii) Transferor
      shall fail or refuse to close the transactions contemplated hereby;
      and

     

    (iii) each
      of
      Transferee and the REIT is ready, willing and able to close the transactions
      contemplated hereby (or, in the event that any of the Transferee Closing
      Conditions shall not have been satisfied, each of Transferee and the REIT would
      be ready, willing and able to close the transactions contemplated hereby but
      for
      such unsatisfied Transferee Closing Conditions),

     

    then,
      Transferee and the REIT may collectively, as their sole and exclusive remedy,
      commence and prosecute an action for specific performance of Transferor’s
      obligations hereunder; provided,
      however,
      that if
      the conditions in Section 7(b)(i) through (iii) are all satisfied and a court
      of
      competent jurisdiction holds that the remedy of specific performance is not
      available to Transferee and the REIT and such court’s order becomes a final and
      non-appealable order (whether through the lapse of time or the exhaustion of
      appeals), then, Transferor and Transferee shall each have the right to terminate
      this Agreement by written notice to the other, whereupon, except as provided
      below, Transferor shall pay to Transferee the amount of $6,082,000 as liquidated
      damages, and the parties hereto shall have no further rights or obligations
      to
      each other under this Agreement, except for Section 7(d) hereof; provided
      further,
      however,
      that
      Transferee and the REIT shall not be entitled to any damages (liquidated or
      otherwise), and either Transferee or Transferor shall be entitled to terminate
      this Agreement, if Transferor’s failure or refusal to close the transactions
      contemplated hereby is due to any of the following: (A) the existence of an
      order, injunction or decree issued by any court or agency of competent
      jurisdiction or other legal restraint or prohibition preventing the consummation
      by Transferor of the transactions contemplated by this Agreement, or (B) the
      existence of a statute, rule, regulation, order, injunction or decree enacted,
      entered, promulgated or enforced by any Governmental Authority which prohibits
      or makes illegal the consummation by Transferor of the transactions contemplated
      hereby, unless in the case of the matters described in the foregoing clause
      (A)
      or (B), the restraint or prohibition is the result of wrongful acts or omissions
      by Transferor to avoid its obligations under this Agreement or is the result
      of
      a breach of any of Transferor’s representations and warranties (other than a
      breach that is caused by any of the situations described in the foregoing
      clauses (A) or (B)) or, in the case of an injunction or other proceeding to
      prevent the consummation of the transactions contemplated hereby, if Transferor
      did not vigorously defend against the imposition of such injunction or such
      other proceeding.

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

    

    (c)
      Subject
      to the proviso set forth at the end of Section 7(a), Transferee acknowledges
      that in the event that the conditions set forth in Section 7(a)(i), (ii) and
      (iii) are satisfied: (x) Transferor will have no adequate remedy at law for
      the
      damages caused to Transferor thereby, in part because the transaction
      contemplated by this Agreement is for a transfer of property representing
      indirect interests in real estate; and (y) the damages caused to Transferor
      thereby will not be readily ascertainable, and that the liquidated damages
      remedy provided by Section 7(a) is a reasonable approximation of Transferor’s
      prospective damages, and not a penalty for non-performance, and Transferee
      hereby waives (A) all objections to Transferor’s right to elect the liquidated
      damages remedy, and (B) all challenges to the amount of liquidated damages
      provided for herein, in each case whether on the grounds that damages are
      readily ascertainable, that the remedy constitutes an unenforceable penalty,
      or
      otherwise.

     

    (d)
      Subject
      to the proviso set forth at the end of Section 7(b), Transferor acknowledges
      that in the event that the conditions set forth in Section 7(b)(i), (ii) and
      (iii) are satisfied: (x) Transferee will have no adequate remedy at law for
      the
      damages caused to Transferee thereby, in part because the transaction
      contemplated by this Agreement is for a transfer of property representing
      indirect interests in real estate; and (y) the damages caused to Transferee
      thereby will not be readily ascertainable, and that the liquidated damages
      remedy provided by Section 7(b) is a reasonable approximation of Transferee’s
      prospective damages, and not a penalty for non-performance, and if Transferee
      is
      entitled to liquidated damages pursuant to Section 7(b), Transferor hereby
      waives any challenge to the amount of liquidated damages provided for herein,
      in
      each case whether on the grounds that damages are readily ascertainable, that
      the remedy constitutes an unenforceable penalty, or otherwise.

     

    (e)
      If
      on the
      Closing Deadline (x) the transactions contemplated hereby have not been
      consummated, and (y) neither Transferor nor Transferee are entitled to elect
      liquidated damages as a remedy pursuant to Sections 7(a) or 7(b), respectively,
      then this Agreement shall terminate, and the parties hereto shall have no
      further rights or obligations to each other under this Agreement.

     

    (f)
      If
      either
      Transferee or Transferor fails to pay to the other any amounts payable under
      this Section 7 within ten (10) days after the date in which a written notice
      of
      termination is delivered pursuant to clause (y) of Section 7(a) or 7(b) hereof,
      as the case may be, (the “Default
      Date”),
      then
      (i) the defaulting party shall reimburse the non-defaulting party for all costs
      and expenses (including without limitation attorney’s fees) incurred in
      connection with the collection of such overdue amount and the enforcement by
      the
      non-defaulting party of its rights under this Section 7, and (ii) the defaulting
      party shall pay to the non-defaulting party interest on such overdue amount
      at a
      rate of 15% per annum for the period commencing on the Default Date and ending
      on the date such overdue amount is actually paid to the non-defaulting party
      in
      full.

     

    (g)
      For
      purposes of this Section 7, “Governmental
      Authority”
means
      any nation, state, territory, province, county, city or other unit or
      subdivision thereof or any entity, authority, agency, department, board,
      commission, instrumentality, court or other judicial body authorized on behalf
      of any of the foregoing to exercise legislative, judicial, regulatory or
      administrative functions and any governmental or nongovernmental self-regulatory
      organization of which any of the parties to this Agreement was or is a member
      or
      to whose regulations any of the parties to this Agreement was or is
      subject.

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    8. Tax
      Reporting; Audits.
      For
      federal, state, and local income tax purposes, Transferee shall report
      Transferor’s contribution of the Interest to the Transferee as a tax-free
      contribution pursuant to Section 721 of the Code (or the corresponding provision
      of state or local law, as applicable). Notwithstanding anything to the contrary
      in this Agreement or the Partnership Agreement, neither Transferee nor the
      REIT
      shall settle any matter that involves the tax treatment of (i) the contribution
      of the Transferred Interests or (ii) any other matter that would have a tax
      impact on Transferor that is materially, adversely different from the tax impact
      such matter would have on the REIT, without the prior written consent of
      Transferor, which shall not be unreasonably withheld or delayed.

     

    9. Maintenance
      of REIT Status.
      Transferee hereby acknowledges that it has been informed that Transferor is
      a
      subsidiary of an entity that qualifies as a “real estate investment trust” for
      United States federal income tax purposes, and acknowledges that Transferor
      may
      transfer its Units to an affiliate of Transferor that is a “real estate
      investment trust” or a subsidiary of a “real estate investment trust” (any such
      entity, a “REIT
      Entity”).
      Transferee represents and warrants to Transferor that it currently operates
      in a
      manner that would not adversely affect the qualification as a “real estate
      investment trust” of any partner of Transferee that otherwise qualifies as a
“real estate investment trust”, and Transferee covenants and agrees that both
      before and after the Closing Date it shall operate (directly or indirectly
      through entities owned or controlled by it) in a manner that would not adversely
      affect the qualification as a “real estate investment trust” of any partner of
      Transferee, or any direct or indirect parent entity of such partner, that
      otherwise qualifies as a “real estate investment trust”. Transferee shall make
      available, on a timely basis, to Transferor and to any other REIT Entity that
      holds Units, such information as is reasonably requested by Transferor or such
      REIT Entity or its direct or indirect parent to enable it to monitor and ensure
      its compliance with the “real estate investment trust” qualification
      requirements, on an ongoing basis, insofar as they relate to its investment
      in
      Transferee, including, without limitation (a) information regarding the nature
      and amount of Transferee’s gross income and gross assets, and the portion
      thereof that is allocable to Transferor for purposes of the gross asset and
      income requirements applicable to “real estate investment trusts” (i.e. on the
      basis of Transferor’s percentage interest in Transferee’s capital), and (b) an
      organizational chart showing each entity in which the Transferee holds any
      direct or indirect equity interest, and indicating the classification for United
      States federal income tax purposes of each such entity. Notwithstanding anything
      contained herein to the contrary, from and after the date hereof, Transferee
      shall operate in a manner, taking into account any operations conducted through
      lower-tier entities, such that at all times (i) Transferee would satisfy each
      of
      the asset tests and the income tests for “real estate investment trusts” as set
      forth in Section 856(c) of the Code, determined as if Transferee were a
      corporation for United States federal income tax purposes, (ii) no dispositions
      of assets will give rise to a “prohibited transaction” as defined in Section
      857(b)(6) of the Code, and (iii) no portion of Transferee or any lower-tier
      entity will be classified as a “taxable mortgage pool” as defined in Section
      7701(i) of the Code.

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    10. Registration
      Rights.
      Each
      of
      Transferee and the REIT agrees
      that in the event that either of them enters into or becomes a party to any
      instrument or agreement which grants registration rights to any limited partner
      of Transferee with respect to shares of stock in the REIT which such limited
      partner may own or acquire, or otherwise grants such registration rights to
      any
      limited partner of Transferee, then each of Transferee and the REIT shall
      promptly notify Transferor and shall grant to Transferor, by entering into
      a
      registration rights agreement with Transferor that is in form and substance
      reasonably acceptable to Transferor, registration rights with respect to any
      shares issued by the REIT that Transferor may acquire in connection with a
      transfer or redemption of any of its Units to or by Transferee or the REIT,
      and
      such registration rights shall be on terms that are no less favorable to
      Transferor in any respect than the most favorable registration rights granted
      to
      any other limited partner of Transferee by Transferee or the REIT.

     

    11. Notices.
      All
      notices shall be deemed to have been properly given if hand delivered or if
      mailed by United States registered or certified mail, with return receipt
      requested, postage prepaid, or by United States Express Mail or other comparable
      overnight courier service to the parties at the addresses set forth below (or
      at
      such other addresses as shall be given in writing by any party to the others).
      A
      notice shall be deemed to have been given: in the case of hand delivery, at
      the
      time of delivery; in the case of registered or certified mail, two Business
      Days
      after mailing; or in the case of overnight courier service, on the Business
      Day
      after the same was sent. A party receiving a notice which does not comply with
      the technical requirements for notice under this section may elect to waive
      any
      deficiencies and treat the notice as having been properly given.

     

    
      	
              If
                to Transferor:

            	 	
              AR
                Prime Holdings,
                LLC 

              333
                Earle Ovington Boulevard, Suite 900

              Uniondale,
                NY 11553

              Attention:
                Guy R. Milone, Jr.

            
	 	 	 
	
              With
                a copy to:

            	 	
              Cooley
                Godward Kronish LLP 

              1114
                Avenue of the Americas

              New
                York, New York 10036

              Attention:
                Thomas D. O’Connor, Esq.

            
	 	 	 
	
              If
                to Transferee or the REIT:

            	 	
              Lightstone
                Value Plus Real Estate Investment Trust Inc.

              326
                Third Street

              Lakewood,
                NJ 08701

              Attention:
                Joseph E. Teichman

            
	 	 	 
	
              With
                a copy to:

               

               

               

            	 	
              Herrick,
                Feinstein LLP

              2
                Park Avenue

              New
                York, New York 10016

              Attention:
                Sheldon Chanales, Esq.

            

    

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    12. Further
      Assurances.
      Each
      party to this Agreement will execute, acknowledge and deliver, or cause to
      be
      executed, acknowledged and delivered, any such further conveyances, assignments,
      approvals, consents and other documents, and do any other acts, as may be
      reasonably necessary to carry out the intent and purpose of this Agreement.
      Without limiting the generality of the foregoing, if, after the Closing, any
      property, assets, collateral, funds, documents or other items which constitute
      a
      part of the Interest remains in or comes into either Transferor’s possession or
      control or remains or become vested or titled in Transferor, Transferor shall
      promptly take any and all actions necessary to transfer title and possession
      thereof to Transferee, all at Transferee’s sole cost and expense.

     

    13. Governing
      Law.
      This
      Agreement shall be construed and enforced in accordance with the laws of the
      State of New York.

     

    14. Binding
      Effect.
      This
      Agreement shall be binding upon, and shall inure to the benefit of, Transferor,
      Transferee and their respective successors and assigns.

     

    15. Severability.
      In the
      event that any phrase, clause, sentence, paragraph, section, article or other
      portion of this Agreement shall become illegal, null or void, or against public
      policy, for any reason, or shall be held by any court of competent jurisdiction
      to be illegal, null or void, or against public policy, the remaining portions
      of
      this Agreement shall not be affected thereby and shall remain in force and
      effect to the full extent permissible by law.

     

    16. Counterparts.
      This
      Agreement may be executed in several counterparts, each of which shall
      constitute an original and all of which, taken together, shall constitute one
      and the same Agreement, binding on each party hereto regardless of whether
      all
      parties are signatories to the same counterpart.

     

    [Remainder
      of Page Intentionally Left Blank]

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, the
      parties hereto have executed this Agreement as of the date first above
      written.

     

    
      	 	 	 
	 	
              TRANSFEROR

              

              AR
                PRIME HOLDINGS LLC,

              a
                Delaware limited liability company

               

              
                By 
                  Arbor
                  Realty Member LLC, a Delaware limited liability company, its
                  manager

                 

                By
                  Arbor
                  Realty SR Inc., a Maryland corporation, its sole member
                  

              

            
	 
 	 
 	 
 
	
            	
            	
              By

            
	 	
              
                

              

              Name:
                

            
	 	
              Title:

            

    

     

    
      	 	 	 
	 	
              TRANSFEREE:

              

              LIGHTSTONE
                VALUE PLUS REIT, L.P.,

              a
                Delaware limited partnership

               

              
                By: 
                  Lightstone
                  Value Plus Real Estate Investment Trust, Inc., a Maryland corporation,
                  its
                  general partner 

              

            
	 
 	 
 	 
 
	
            	
            	
              By:

            
	 	
              
                
Name:

            
	 	
              Title:

            

    

     

    
      	 	 	 
	 	
              LIGHTSTONE
                VALUE PLUS REAL ESTATE 

              INVESTMENT
                TRUST, INC.,

              a
                Maryland corporation, its general partner 

            
	 
 	 
 	 
 
	
            	By:  	
            
	 	
              

              Name:
                

            
	 	Title:

    

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

    ANNEX
      I

    

    PARTNERSHIP
      AGREEMENT

    [INCLUDING
      ALL AMENDMENTS THERETO]

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    ANNEX
      II

    

    CAPITALIZATION
      OF TRANSFEREE

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    EXHIBIT
      A

    

    ASSIGNMENT
      OF INTEREST

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    EXHIBIT
      B

    

    REPRESENTATION
      LETTER AND AGREEMENT

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    EXHIBIT
      C

    

    LIMITED
      PARTNER SIGNATURE PAGE

    TO
      PARTNERSHIP AGREEMENT

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    EXHIBIT
      D

    

    EXCHANGE
      RIGHTS AGREEMENT

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    EXHIBIT
      E

    

    RELEASE
      AGREEMENT

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    EXHIBIT
      F

    

    ADDITIONAL
      PROMISSORY NOTE

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    EXHIBIT
      G

    

    NEW
      PLEDGE AGREEMENT

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    EXHIBIT
      H

    

    CERTIFICATE
      EVIDENCING ACTION BY THE

    GENERAL
      PARTNER OF TRANSFEREE TO ISSUE

    COMMON
      UNITS AND SERIES A UNITS

    TO
      TRANSFEREE

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
      I

    

    CONSENT
      TO TRANSFER, SUBSTITUTION AND WITHDRAWAL

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00146-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00146-of-00352.parquet"}]]