EX-10 4 exhibit10_2.txt EXHIBIT 10.2 - AGREEMENT PURCHASE & SALE AGREEMENT FOR PURCHASE AND SALE OF REAL PROPERTY BY AND BETWEEN WHTS FREEDOM CIRCLE PARTNERS II, L.L.C., a Delaware limited liability company, AS SELLER AND PMC-SIERRA, INC., a Delaware corporation, AS BUYER DATED JULY 2, 2003 PROPERTY LOCATED AT: 3985 FREEDOM CIRCLE SANTA CLARA, CALIFORNIA AGREEMENT FOR PURCHASE AND SALE OF REAL PROPERTY THIS AGREEMENT FOR PURCHASE AND SALE OF REAL PROPERTY (the "Agreement") is dated as of the 2nd day of July, 2003 (the "Contract Date"), by and between WHTS FREEDOM CIRCLE PARTNERS II, L.L.C., a Delaware limited liability company ("Seller"), and PMC-SIERRA, INC., a Delaware corporation ("Buyer"). RECITALS WHEREAS, Seller desires to cause the sale, assignment and transfer of its interests in and to the Property (as hereinafter defined) to Buyer and Buyer desires to purchase such interests from Seller upon the terms of this Agreement. AGREEMENT NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Seller and Buyer hereby agree as follows: 1. Definitions. Unless the context otherwise specifies or requires, for the purposes of this Agreement all words and phrases having their initial letters capitalized herein shall have the meanings set forth below: "Adjacent Property" shall mean the real property owned by WHTS Freedom Circle Partners, L.L.C., a Delaware limited liability company, commonly known as 3975 Freedom Circle, Santa Clara, California, and more particularly described in Exhibit R to this Agreement. "Buyer Party" shall mean one unaffiliated third party designated by Buyer prior to the Scheduled Closing Date. "Closing Certificate" will be the WHTS Closing Certificate to be delivered to Buyer on the Closing Date in the form of Exhibit O. "Closing Date" shall mean the date of recordation of the Deed. "Closing Documents" shall mean the Closing Certificate, the Parking Easement Agreement, the Reliance Letter, and the Development Indemnity Agreement and, if applicable, the WHTS Modification Indemnity. "Contingency Period" shall mean the period commencing on the Contract Date and terminating at 5:00 p.m. Pacific Time on July 2, 2003. "Contract Date" shall mean May 12, 2003. "Development Indemnity Agreement" shall mean a Development Indemnity Agreement in the form set forth in attached Exhibit S, to be executed and recorded in the office of the Santa Clara County Clerk Recorder, on or prior to the Closing Date, by Seller and WHTS Freedom Circle Partners, L.L.C. a Delaware limited liability company (as the owner of the Adjacent Property). "Environmental Insurance Policy" shall mean an insurance policy acceptable to Buyer insuring against loss and liability as a consequence of the presence of legionella bacteria in the Property after the Closing Date in such form and from such insurer and with such coverages, deductibles, and exclusions as Buyer shall approve during the Contingency Period and insuring Buyer and such other parties as Buyer shall designate during the Contingency Period as additional insureds. "Environmental Laws" shall mean any and all federal, state and local laws, statutes, rules, regulations, requirements under permits issued with respect thereto, and other requirements of any federal, state or local governmental agency, court, board, bureau or other authority having jurisdiction with respect to or relating to the environment, to any Hazardous Substance or to any activity involving Hazardous Substances, and shall include, without limitation, the Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C. Section 9601, et seq., the Federal Resource Conservation and Recovery Act (42 U.S.C. Section 6901, et seq.) and all amendments thereto in effect as of the Closing Date. "Hazardous Substances" shall mean and include any chemical, compound, material, mixture, waste or substance that is defined or listed in, or otherwise classified pursuant to, any Environmental Laws as a "hazardous substance," "hazardous material," "hazardous waste," "extremely hazardous waste," "infectious waste," "toxic substance," "toxic pollutant" or any other formulation intended to define, list, or classify substances by reason of deleterious properties such as ignitability, corrosivity, reactivity, carcinogenicity, or toxicity including any petroleum, natural gas, natural gas liquids, liquified natural gas, or synthetic gas usable for fuel (or mixture of natural gas and such synthetic gas) and including legionella bacteria. "Hazardous Substances" shall include, without limitation, any hazardous or toxic substance, material or waste or any chemical, compound or mixture which is (i) asbestos, (ii) designated as a "hazardous substance" pursuant to Section 1317 of the Federal Water Pollution Control Act (33 U.S.C. Section 1251 et seq.), (iii) defined as a "hazardous waste" pursuant to Section 6903 of the Federal Resource Conservation and Recovery Act, (42 U.S.C. Section 6901 et seq., (iv) defined as "hazardous substances" pursuant to Section 9601 of the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601 et seq.), or (v) listed in the United States Department of Transportation Table (49 CFR 172.101) or by the Environmental Protection Agency as hazardous substances (40 CFR part 302); or in any and all amendments thereto in effect as of the Closing Date; or such chemicals, compounds, mixtures, substances, materials or wastes otherwise regulated under any applicable local, state or federal Environmental Laws. "Hillmann" shall mean Hillmann Environmental Company, Inc., now known as Hillmann Environmental Group. "Improvements" shall mean all improvements and fixtures now or hereafter located on the Land including, without limitation, the twelve (12) story building (the "Building") constructed on the Land, together with all appurtenances thereto and all apparatus, equipment and appliances located on the Land and owned by Seller and used in connection with the operation and occupancy thereof such as systems or facilities for heating, ventilation, air conditioning, climate control, utility services, parking services, garbage disposal, irrigation and/or recreation, and all landscaping. "Intangible Property" shall mean Seller's rights, title and interests in: (a) any and all transferable or assignable permits, building plans and specifications, certificates of occupancy, operating permits, sign permits, development rights and approvals, certificates, licenses, warranties and guarantees, trade names, service marks, engineering, soils, pest control and other reports relating to the Property, tenant lists, advertising materials, and telephone exchange numbers identified with the Property; and (b) all other transferable intangible property, miscellaneous rights, benefits or privileges of any kind or character with respect to the Property. "Land" shall mean the real property commonly known as 3985 Freedom Circle, Santa Clara, California, and more particularly described in Exhibit A to this Agreement, and all rights and interests appurtenant thereto, including but not limited to rights under the Parking Easement Agreement and all other easements, riparian or other water rights, rights of way and other interests appurtenant thereto, and all right, title and interest of Seller in and to any land lying in the bed of any street, road, highway or avenue, open or proposed, in front of, adjacent to or adjoining such real property and in all strips and gores. "Laws and Restrictions" shall mean all applicable federal, state, local and other laws, statutes, regulations, codes, orders, ordinances and rules including, without limitation, those relating to fire, safety, land use, subdivision, health, labor, environmental protection, seismic design, conservation, parking, handicapped access, zoning and building, and all restrictive covenants (if any), other title encumbrances and other obligations affecting the Property, all Environmental Laws, all applicable provisions of the Fair Housing Act of 1968 and the Americans With Disabilities Act of 1990, and all amendments thereto. "Material Exception" is defined in Section 4(c)(viii). "PMC Lease" shall mean that certain lease dated July 20, 2000 between Seller, as landlord and PMC-Sierra, Inc., as tenant (the "Tenant"), as amended by First Amendment to Lease dated November 6, 2000. "Parking Easement Agreement" shall mean that certain Easement Agreement dated July 6, 2000, and recorded on September 22, 2000 as Document No. 15400202 in the office of the Santa Clara County Clerk Recorder, as amended by First Amendment dated October 31, 2000, recorded as Document No. 15445030 on November 2, 2000, by and between Seller and WHTS Freedom Circle Partners, L.L.C., as the same shall be amended and restated (and recorded in the office of the Santa Clara County Clerk Recorder) on the Closing Date as set forth in attached Exhibit J. "Permitted Exceptions" shall mean the exceptions to title identified as items 1 through 16, inclusive, on Schedule B Part 2 of the Title Commitment attached hereto as Exhibit I. "Personal Property" shall mean all personal property now or hereafter owned by Seller, which is used in connection with the Land, the Improvements and/or the Intangible Property or the ownership or operation thereof including, without limitation, all furniture, fixtures, machinery, appliances and equipment located on the Property, other than personal property owned by tenants of the Property. A list of the Personal Property is attached hereto as Exhibit C. "Property" shall mean collectively the Land, the Improvements, the Personal Property, and the Intangible Property and all of Seller's interest, as landlord, in and to the PMC Lease. "Reliance Letter" shall mean the letters in the form of Exhibit Q attached hereto and duly signed by Hillmann. "Scheduled Closing Date" shall mean July 7, 2003. "Title Commitment" shall mean that title commitment issued by the Title Company for an ALTA Extended Coverage Owner's Policy of Title Insurance (Form B, Rev. 10/17/70), and including a commitment for the following endorsements: CLTA endorsements numbered 100 (modified) 100.6, 103.4, 103.7, 116, 116.1, 116.4, 116.7 and 123.2, a "Fairway" endorsement, and a "separate tax parcel" endorsement, which is attached hereto as Exhibit I. "Title Company" shall mean First American Guaranty Company whose address for this transaction is as follows: First American Guaranty Company 1737 North First Street, Suite 100 San Jose, California 95112 Attn: Mike Hickey Fax No. (408) 451-7836 "Title Policy" is defined in Section 4(c)(i). "WHTS Modification Indemnity" shall mean a WHTS Modification Indemnity in the form set forth in attached Exhibit T as described in Sections 4(c)(viii) and (ix). 2. Purchase And Sale. Seller agrees to sell the Property to Buyer, and Buyer agrees to purchase the Property from Seller, on all of the terms, covenants and conditions set forth in this Agreement. 3. Purchase Price. The total purchase price for the Property (the "Purchase Price") shall be the sum of $133,000,000 which, subject to all prorations and adjustments provided in this Agreement, shall be paid by Buyer to Seller through escrow on the Closing Date as follows: 3.1 Deposit. Prior to the expiration of the Contingency Period, provided Buyer does not elect to terminate this Agreement in accordance with Section 4 below, Buyer shall deposit with the Title Company the amount of $2,000,000 (the "Deposit"), which sum the Title Company shall deposit in a federally insured interest-bearing "money market" account at a financial institution reasonably acceptable to Seller and Buyer with the interest from such account to be credited to Buyer. 3.2 Cash Payment. The balance of Purchase Price shall be paid to Seller by wire transfer in immediately available federal funds on the Closing Date. 4. Review And Inspection; "As-Is" Purchase; Conditions To Agreement. (a) Review And Inspection. During the Contingency Period, Buyer and, if applicable, any Buyer Party designated by Buyer prior to the close of escrow, shall have the right to conduct, at its sole cost and expense, such investigations, studies, surveys, analyses and tests on and of the Property as it shall, in its sole discretion, determine are necessary or desirable, including, without limitation, soil tests, environmental audits and studies, and make such evaluations as Buyer may, in its sole and absolute discretion, determine are necessary or desirable under the circumstances, provided that (i) Buyer and any such Buyer Party shall only have the right to conduct soils and groundwater tests and borings regarding the environmental condition of the Property with the Seller's prior written consent, which shall not be unreasonably withheld or delayed, (ii) Buyer shall maintain, or in the case Buyer Party is the entering party, cause Buyer Party to maintain, a Three Million Dollar ($3,000,000) combined, single limit, comprehensive general commercial liability insurance policy with respect to the Property, issued by a licensed insurance company naming Seller and Seller's property manager as additional insureds; and (iii) Buyer shall defend, indemnify, protect and hold Seller and the Property and Seller's affiliates, members, subsidiaries, officers, directors and agents harmless from and against any loss, cost, damage, or expense (including without limitation, reasonable attorneys' fees) incurred by Seller as a result of property damage, personal injury, or mechanics' liens, to the extent arising out of Buyer's or Buyer Party's inspections of the Property and Improvements. Without limiting the generality of the foregoing, Buyer agrees to pay Seller, or cause a Buyer Party to pay Seller, upon demand, the cost of repairing and restoring any damage or disturbance which Buyer, Buyer Party or their respective agents or contractors cause to the Property. Notwithstanding the foregoing, Buyer Party shall have no liability for the discovery of any matters in, on, at, or relating to the Property. The indemnity contained in this Section 4(a) shall survive the close of escrow or termination of this Agreement. In order to perform the foregoing investigations, during the Contingency Period, Buyer, Buyer Party (if applicable), their respective potential lenders, and the agents, contractors, and employees for said parties, shall have reasonable access to the Property, all for the purposes of inspecting the same and conducting tests, inspections, and analyses thereon and making evaluations thereof, all at the Buyer's, or Buyer Party's (if applicable), expense. In particular, Buyer and Buyer Party shall be permitted to conduct the borings, drillings, soils tests and groundwater tests described on Exhibit N attached hereto. Buyer and Buyer Party shall not be permitted to conduct any other borings, drillings, soils tests, or groundwater tests on the Property in connection with the preparation of an environmental audit or in connection with any other inspection of the Property without the prior written reasonable consent of Seller. Buyer or Buyer Party, as the case may be, shall schedule and coordinate all inspections, including, without limitation, any environmental tests, with Seller and shall give Seller at least one (1) business day's prior notice of such test. Seller shall be entitled to have a representative present at all times during each such inspection. Seller has made available to Buyer the documents, plans, studies (environmental or otherwise) and reports listed on Exhibit M attached hereto. Except as expressly provided to the contrary in the Seller Certificate or this Agreement, Seller makes no representation or warranty relating to the validity of such information and Buyer (or Buyer Party as the case may be) is responsible to verify such information at its discretion. In conducting the inspection of the Property, Buyer shall at all times comply with all laws and regulations of all applicable governmental authorities, and Buyer shall not contact or have any discussions with any of Seller's employees, agents or representatives, or with any contractors providing services to the Property unless in each case Buyer obtains the prior consent of Seller, which consent shall not be unreasonably withheld, it being agreed that all such contacts or discussions shall, pending any such approval, be directed to Carl Shannon ((415) 536-1850). (b) Termination During Contingency Period. Buyer may, at any time during the Contingency Period, for any reason or no reason, (i) terminate this Agreement by delivering to Seller its written notice of termination prior to the expiration of the Contingency Period, or (ii) waive its right to terminate this Agreement by, prior to the expiration of the Contingency Period, (a) waiving its termination right in writing and delivering such waiver to Seller, and (b) timely delivering the Additional Deposit to the Title Company. In the event Buyer (1) fails to provide a written waiver of its right to terminate in accordance with the foregoing no later than 5 p.m. Pacific Time on the last day of the Contingency Period, or (2) fails to deposit the Additional Deposit with the Title Company no later than 5 p.m. Pacific Time on the last day of the Contingency Period, then this Agreement shall automatically terminate. In the event of any automatic termination or other termination by Buyer pursuant to this Section 4(b), (x) the Initial Deposit and all other funds deposited in escrow by Buyer and all interest accrued on such funds (less Buyer's share of any escrow and title cancellation fees) shall be returned immediately to Buyer, (y) all documents deposited in escrow by Buyer or Seller shall be returned to the depositing party, and (z) Buyer shall promptly deliver to Seller, at no cost to Seller, and without representation or warranty, the originals or copies of all tests, reports and inspections of the Property, which do not restrict such delivery to a third party, made and conducted by Buyer, Buyer Party or for Buyer's benefit or for Buyer Party's benefit which are in the possession or control of Buyer and promptly return to Seller copies of all materials delivered by Seller to Buyer and shall destroy all copies and abstracts thereof, and except for this Section 4(b) and the provisions of this Agreement that expressly survive the termination of this Agreement, this Agreement shall be null and void and of no further force and effect, and neither Seller nor Buyer shall have any further rights or obligations hereunder. (c) Conditions Precedent. Buyer's obligation to purchase the Property shall be conditioned expressly upon the fulfillment of each of the following conditions precedent on or before the Closing Date: (i) The issuance by the Title Company, or the irrevocable binding commitment of the Title Company to issue, on the Closing Date, conditioned only upon payment of the Title Company's regularly-scheduled premium, the title policy ("Title Policy") described in the Title Commitment, including the endorsements described in the Title Commitment, insuring fee simple absolute title to the Property, free and clear of all liens and encumbrances except for the Permitted Exceptions. (ii) Subject to Section 8 of this Agreement, there shall have been no material adverse change in the condition of the Property or any portion thereof. (iii) There are no contracts, other than the PMC Lease, the Permitted Exceptions, and any other agreements approved in writing by Buyer, which will affect the Property or be binding upon Buyer on or after the Closing Date. (iv) From and after the Contract Date, Seller has not failed in any material respect to perform the items described in clauses (i) through (vi) of Section 5.3(a) below. (v) From and after the Contract Date, Seller has not removed or permitted the removal of any Personal Property or any fixtures from the Property except to the extent such items were replaced with Personal Property or fixtures of equal or greater value. (vi) The execution, acknowledgement, and delivery by Seller and the owner of the Adjacent Property of an Amended and Restated Parking Easement Agreement in the form attached hereto as Exhibit J, the recordation thereof in the office of the Santa Clara County Clerk Recorder and the recorded subordination thereto by the holder of any deed of trust or other foreclosable document or instrument currently encumbering the Adjacent Property, all on or prior to the Closing Date. (vii) The execution and delivery by Hillmann to Buyer and Buyer Party (if applicable) of the Reliance Letter. (viii) The execution and delivery to Buyer of the Closing Certificate. Notwithstanding the foregoing, if Seller includes any matter on Schedule 2 to the Closing Certificate and all matters on Schedule 2 to the Closing Certificate, when taken together, constitute a "Material Exception" (as hereinafter defined), Buyer shall have the right to terminate this Agreement. Upon any such termination, the Deposit will be returned by the Title Company to Buyer (and Seller shall so instruct the Title Company) and, subject to the provision for reimbursement of expenses under certain circumstances set forth in this Section 4(c)(viii), this Agreement shall terminate and be of no further force or effect, except for those provisions that expressly survive the termination hereof. If this Agreement is not so terminated by Buyer, then Seller and Buyer shall consummate this transaction in accordance with this Agreement. If Seller includes any matter on Schedule 2 to the Closing Certificate, but all of the matters on Schedule 2 to the Closing Certificate do not in the aggregate constitute a Material Exception, then (1) Buyer shall have no right to terminate this Agreement pursuant to this Section 4(c)(viii), (2) the additional condition precedent described in Section 4(c)(ix) shall apply, and (3) subject to the terms and conditions of this Agreement, Seller and Buyer shall consummate this transaction without any abatement in the Purchase Price as a result of that matter (so long as the condition precedent described in Section 4(c)(ix) is satisfied). Furthermore, if Buyer terminates this Agreement pursuant to this Section 4(c)(viii) and a matter set forth on Schedule 2 to the Closing Certificate, which alone or together with other matters thereon, gave rise to the termination right, makes the representations and warranties made by Seller in Section 5.1 false as of the Contract Date, then Seller, upon Buyer's written request, shall pay to Buyer an amount equal to all of the Buyer Party's out-of-pocket costs incurred in connection with or related to the Property, including without limited to legal expenses, non-refundable loan fees, and studies, inspections and investigations of the Property during the Contingency Period, but in no event to exceed $250,000. For the purposes of this Section 4(c)(viii), the matters set forth on Schedule 2 to the Closing Certificate shall be deemed a "Material Exception," if, but only if, all of the matters included on Schedule 2 to the Closing Certificate, when taken together, would reasonably be expected to result in additional cost, expense, liability and/or damage to Buyer (after factoring in all cost of litigating, resolving, and/or defending the matter, any reduction in the fair market value of the Property, any contingent liability, and the cost of any delay in the lease-up of the Property) in excess of Five Hundred Thousand Dollars ($500,000). The provisions of this Section 4(c)(viii) shall survive the close of escrow or the termination of this Agreement. In addition, the provisions of this Section 4(c)(viii) shall be subject to Section 8 of this Agreement and shall not apply to any events covered thereunder. (ix) If, but only if, required pursuant to Section 4(c)(viii) above, the delivery to Buyer of the WHTS Modification Indemnity. The WHTS Modification Indemnity shall be subject to the limitations set forth in the Closing Certificate. (x) The execution, acknowledgement, and delivery by Seller and the owner of the Adjacent Property of the Development Indemnity Agreement and the recordation of the Development Indemnity Agreement in the office of the Santa Clara County Clerk Recorder, all on or prior to the Closing Date. (xi) The issuance of the Environmental Insurance Policy. Buyer shall use, or shall cause Buyer Party to use, good faith efforts to obtain the Insurance Policy. At any time or times on or before the Scheduled Closing Date, Buyer may waive any of the foregoing conditions by written notice to Seller. Other than Buyer's close of escrow pursuant to this Agreement, which shall waive all such unfulfilled conditions, no waiver shall be effective unless made in writing specific as to the conditions or matters so waived. (d) AS IS Purchase. Buyer acknowledges that Buyer will have had the opportunity to conduct prior to the Closing Date, such studies and investigations of the Property as Buyer desires, and that Buyer will have had the right to observe to its satisfaction, and will have observed to its satisfaction, the physical characteristics and condition of the Property. Except as expressly set forth in the Closing Documents, Buyer acknowledges and agrees that the Property is to be purchased and accepted by Buyer in its condition as of the Closing Date, "AS IS", without any implied or express warranty or representation by Seller or anyone acting or purporting to act on Seller's behalf ("Seller's Agents"), and with all patent and latent defects. No representations or warranties, express or implied regarding the Property or matters affecting the Property have been or will be made with respect to the Property or the subject matter of this Agreement, by Seller or Seller's Agents, or by any other person or entity, except as expressly set forth in this Agreement or the Closing Documents. Without limiting the foregoing, Buyer acknowledges that no representation is or will be made concerning the physical condition, environmental, economic, or legal condition of the Property, title to or the boundaries of the Property, topography, climate, air, water rights, utilities, leases, water, present and future zoning, physical condition, soil condition, pest control matters, engineering characteristics, traffic patterns, purposes to which the Property may be suited, value, potential for development, contamination, drainage, access to public roads, proposed routes of roads or extensions thereof, and compliance with building, health, safety laws, Environmental Laws, land use laws and regulations to which the Property may be subject or any other matter in any way affecting the Property, or the use or ownership thereof (herein collectively the "Property Matters") by Seller, Seller's Agents, or by any other person or entity, except as expressly set forth in this Agreement or the Closing Documents. Buyer acknowledges that, although Seller has disclosed or made available documents and reports concerning the Property, other than those specifically set forth in this Agreement and the Closing Documents, (i) that Seller cannot and does not make any warranty or representation whatsoever concerning the completeness or the accuracy of information contained in such documents and reports and (ii) that Buyer is not relying upon any such representations and warranties made by Seller, Seller's Agents, or any other person or entity. Buyer further acknowledges that it has not received from Seller or anyone acting or claiming to act on Seller's behalf, any accounting, tax, legal, architectural, engineering, property management, environmental or other advice with respect to this transaction and is relying solely upon the advice of its own accounting, tax, legal, architectural, engineering, property management, environmental and other advisors. THEREFORE, EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT OR THE CLOSING DOCUMENTS, SELLER MAKES NO REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, DIRECTLY OR INDIRECTLY, TO BUYER, AND SELLER IS TRANSFERRING TO BUYER, AND BUYER IS PURCHASING THE PROPERTY FROM SELLER, IN ITS "AS IS' CONDITION ON THE CLOSING DATE, AND BUYER IS ASSUMING ON THE CLOSING DATE THE RISK THAT ADVERSE PHYSICAL, ENVIRONMENTAL, ECONOMIC OR LEGAL CONDITIONS MAY NOT HAVE BEEN REVEALED BY ITS INVESTIGATION. Notwithstanding the foregoing, but subject to any Release executed as of the Closing Date in the form attached hereto as Exhibit U, nothing contained in, nor any of the statements made or actions taken by either party in connection with, this Agreement shall be deemed to have in any manner waived, released, modified or discharged Buyer and Seller of their respective rights and obligations under the PMC Lease or under applicable statutory or common law with respect to the Property, the Property Matters or the undertakings and rights of the parties as set forth in the PMC Lease. This Section 4(d) shall survive the close of escrow. Buyer hereby specifically acknowledges that Buyer has carefully reviewed this subsection and discussed its import with legal counsel and that provisions of this subsection are a material part of this Agreement. 5. Representations, Warranties, Covenants And Agreements. 5.1 Representations And Warranties Of Seller. Seller hereby makes the following representations and warranties to and for the benefit of Buyer, each of which representations and warranties (i) is material and being relied upon by Buyer, (ii) is made as an inducement to Buyer to enter into this Agreement and consummate the transaction contemplated hereby, (iii) is true in all respects as of the date of this Agreement, and (iv) shall survive the close of escrow but such survival shall be limited as set forth in this Section 5.1. (a) Seller is a Delaware limited liability company and has the full power, authority and legal right to enter into and perform this Agreement. The execution, delivery and performance of this Agreement have been duly authorized by all necessary action on the part of the Seller. (b) Seller has no actual knowledge of any pending or threatened actions or proceedings before any court or administrative agency which could reasonably be expected to materially and adversely affect the ability of Seller to perform Seller's obligations under the Purchase Agreement. (c) To the best of Seller's actual knowledge, there are no pending or threatened condemnation or similar proceeding affecting the Property or any portion thereof. (d) To the best of Seller's actual knowledge, other than claims made by PMC under the PMC Lease, there are no third party claims, legal actions, suits, or other legal or administrative proceedings, pending or threatened against the Property. (e) To the best of Seller's actual knowledge, there is no unrecorded or undisclosed legal or equitable interest in the Property owned or claimed by any party other than Seller or Buyer. (f) Seller has not received any written notices from any governmental agencies of any condition, or defects with respect to any violations of building codes and/or zoning ordinances, Environmental Laws or other governmental laws, regulations or orders with respect to the Property that remain uncured. Seller shall promptly notify Buyer of any violations or conditions of which Seller becomes aware. (g) To the best of Seller's actual knowledge, except for the PMC Lease (as defined in the Purchase Agreement), there are no leases or adverse or other parties in possession of the Property or any part thereof. (h) Seller has made available or shall make available to Buyer on or prior to June 16, 2003 all reports and documents in Seller's possession or control with respect to the physical, environmental and legal condition of the Property, and Seller is not aware that any other reports or documents regarding such matters, and generated or dated after Seller's initial acquisition of title to the Property, exist. (i) Except for the PMC Lease, the Permitted Exceptions, that certain Master License Agreement dated May 4, 2001 by and between TishmanSpeyer Properties and Ad Walls, LLC, that certain Information Services Agreement dated August 2000 between WHTS and Elevator News Network (the "Elevator News Agreement"), and other agreements or obligations referred to or contemplated by this Agreement, there are no leases, contracts, employment agreements, service contracts, utility contracts, construction contracts, maintenance agreements, leasing and brokerage agreements or any other contracts, agreements and obligations, whether or not in writing, which relate to Seller's ownership, operation, management, maintenance and use or occupancy of the Property which will be binding on the Property, Buyer or any Buyer Party after the Closing Date. On or prior to the Closing Date, WHTS shall terminate the Elevator News Agreement. (j) Seller is not a "foreign person" as defined in Internal Revenue Code Section 1445 and any related regulations. At the closing, Buyer will have no duty to collect withholding Taxes for Seller pursuant to the Foreign Investment in U.S. Real Property Tax Act of 1980, as amended. (k) Seller has not (i) made a general assignment for the benefit of creditors, (ii) filed any voluntary petition in bankruptcy or suffered the filing of any involuntary petition by its creditors; (iii) suffered the appointment of a receiver to take possession of all or substantially all of its assets; or (iv) suffered the attachment or other judicial seizure of all or substantially all of its assets. (l) Seller hereby represents that that certain License Agreement dated August 17, 1999, by and between the City of Santa Clara and WHTS Freedom Circle Partners, L.L.C., is the document which is referred to as an "agreement to landscape and maintain" on page 9 of the Project Conditions to Development Plan, and on page 14, Special Provision No. 11, of the Property Development Agreement between TishmanSpeyer and City Public Works; and to the best of Seller's actual knowledge, there is no other agreement with the City of Santa Clara with respect to the Property regarding maintenance and landscaping of City-owned property. Any and all uses of the phrase, "to the best of Seller's actual knowledge" or other references to Seller's knowledge or Seller's awareness in this Agreement shall be limited to the actual, present, conscious knowledge of Carl Shannon and Yolanda Faile (the "Seller Knowledge Individuals") which either of them has, or should have had after reasonable investigation and inquiry, as to a fact as of the date hereof. Seller hereby represents and warrants that the Seller Knowledge Individuals are the persons affiliated with Seller most likely to have knowledge of the matters which are the subject of the representations. Subject to the first sentence of this paragraph with respect to reasonable investigation and inquiry, neither the actual, present, conscious knowledge of any other individual or entity, nor the constructive knowledge of the Seller Knowledge Individuals or of any other individual or entity, shall be imputed to the Seller Knowledge Individuals. The representations, warranties, covenants and agreements of Seller contained in this Section 5.1 shall survive the Closing for one (1) year following the Closing Date (the "Limitation Period") except that the Limitation Period with respect to the representations and warranties of Seller contained in clauses (b), (d), (f) and (h) of this Section 5.1 shall be two (2) years. Each such representation and warranty shall automatically be null and void and of no further force and effect following the expiration of the applicable Limitation Period unless, prior to such expiration, Buyer shall have provided Seller with a written notice alleging that Seller shall be in breach of such representation or warranty and specifying in reasonable detail the nature of such breach. Any legal proceeding against Seller for such breach must be commenced, if at all, within ninety (90) days after the expiration of the applicable Limitation Period. Notwithstanding anything to the contrary set forth in this Agreement, Seller's liability for breach of any covenant, obligation, representation, agreement or warranty of Seller contained in this Agreement and in any document executed by Seller pursuant to this Agreement, including any instruments delivered at Closing, shall, subject to the limitations of survival set forth in this Section 5.1 be limited to claims in excess of One Hundred Thousand Dollars ($100,000) in the aggregate (but once the aggregate exceeds $100,000, Seller shall be liable to the full extent of such claims), and Seller's aggregate liability for any and all claims arising out of any such covenants, obligations, representations, agreements and warranties shall not exceed Five Million Dollars ($5,000,000). 5.2 Representations And Warranties Of Buyer. Buyer hereby makes the following representations and warranties to and for the benefit of Seller, each of which representations and warranties (i) is material and being relied upon by Seller, (ii) is made as an inducement to Seller to enter into this Agreement and consummate the transaction contemplated hereby, (iii) is true in all respects as of the date of this Agreement, (iv) shall be true in all material respects on the Closing Date, and (v) shall survive the close of escrow: (a) Buyer is a Delaware corporation and it has the full power, authority and legal right to enter into and perform this Agreement. The execution, delivery and performance of this have been duly authorized by all necessary action on the part of Buyer. (b) Buyer has not (i) made a general assignment for the benefit of creditors; (ii) filed any voluntary petition in bankruptcy or suffered the filing of any voluntary petition by its creditors; (iii) suffered the appointment of a receiver to take possession of all or substantially all of its assets; or (iv) suffered the attachment or other judicial seizure of all or substantially all of its assets. (c) Until the Closing Date, Buyer shall continue to pay, under protest and without waiver or derogation of any of its rights or defenses to the PMC Lease, all rents and other sums specified as payable by the lessee under the PMC Lease and to perform, under protest and without waiver or derogation of any of its rights or defenses to the Lease, all of obligations of the lessee otherwise specified in the PMC Lease. Payment of such sums and performance of such obligations by Buyer shall not waive but shall be subject to all rights of reimbursement and all claims and defenses under the PMC Lease to which the Tenant is or may be entitled. The representations and warranties of Buyer contained in this Section 5.2 shall survive the Closing for two (2) years following the Closing Date. Notwithstanding anything to the contrary set forth in this Agreement, Buyer's liability for breach of any covenant, representation or warranty of Buyer contained in the Agreement, shall be limited to claims in excess of One Hundred Thousand Dollars ($100,000) in the aggregate, and Buyer's aggregate liability for any and all claims arising out of any such covenants, representations and warranties shall not exceed Five Million Dollars ($5,000,000). 5.3 Agreements. Each of Buyer and Seller hereby specifically agrees as follows: (a) From the date of this Agreement to the Closing Date, Seller shall (i) manage, maintain, operate, and service the Property, to the same standard as existed at the Contract Date so as to keep the Property and every portion thereof in the same working order and repair as existed on the Contract Date, (ii) not remove or permit the removal of any Personal Property or any fixtures from the Property unless such items are replaced immediately with Personal Property or fixtures of equal or greater value, (iii) comply, in all material respects, with all Laws and Restrictions with respect to the Property, (iv) not modify, terminate, cancel, extend, or amend any lease, contracts or arrangements which will affect the Property or be binding upon the Buyer on or after the Closing Date, without the consent of Buyer, which consent shall not be unreasonably withheld, conditioned or delayed, (v) not enter into any leases or other agreements with respect to the occupancy, maintenance or improvement of the Property that continue after the Closing Date without Buyer's prior written approval (which Buyer may withhold in its sole discretion), and (vi) maintain in full force and effect all of the insurance policies and coverages currently in effect with respect to the Property. From the date of this Agreement to the earlier of the Scheduled Closing Date or the termination of this Agreement, Seller shall not lease or otherwise transfer the PMC Lease, the Property, or any portion thereof or interest therein (except to a party which has assumed the obligations of Seller under this Agreement). (b) Seller shall promptly after the Contract Date turn on (and shut down daily for approximately 12 hours at night to simulate night time conditions but not flush more than once per week) all water systems at the Property, including without limitation hot water, HVAC, heating, and air conditioning systems, to permit the testing described in Exhibit N hereto. (c) Seller shall promptly notify Buyer in writing of any event or circumstance known to Seller which materially adversely affects Seller's ability to perform its obligations under this Agreement in a timely manner or the likelihood of timely satisfaction of the conditions precedent set forth above. (d) Seller shall promptly notify Buyer in writing if Seller becomes aware of any fact or occurrence that would render any of its representations or warranties under Section 5.1 above untrue, or would render it unable to deliver the Closing Certificate on the Closing Date. (e) Seller shall use good faith efforts to obtain from the holder of any deed of trust or other foreclosable document or instrument currently encumbering the Adjacent Property the subordination set forth in Section 4(c)(vi). Seller shall reasonably cooperate with Buyer in Buyer's efforts to obtain the Insurance Policy. (f) Seller shall pay at the close of escrow fifty percent (50%) of the cost of the one-time premium for the Environmental Insurance Policy (the "Insurance Premium") up to a maximum of One Hundred Fifty Thousand Dollars ($150,000) (i.e., up to an Insurance Premium of $300,000) and Buyer shall pay at the close of escrow the cost of the Insurance Premium in excess of said amount. (g) Prior to the Closing, Seller shall have the right, to the extent permitted under and in accordance with the terms of the PMC Lease, to apply any security deposits held under the PMC Lease in respect of defaults by Tenant under the PMC Lease. At the Closing, Seller shall deliver to Buyer the letter of credit held by Seller as security under the Lease and not applied to defaults as above provided. 6. TITLE, ESCROW AND CLOSING. 6.1 Conditions Of Title. (a) On the Scheduled Closing Date, Seller shall convey title to the Property to Buyer free and clear of all liens and encumbrances except the Permitted Exceptions, the PMC Lease, the Parking Easement Agreement and the Development Indemnity Agreement. (b) Seller shall deliver to Escrow Holder a deed in the form attached hereto as Exhibit E (the "Deed") conveying title to the Property to Buyer. The Title Company shall issue, or shall be irrevocably bound and committed to issue, on the Closing date, conditioned only upon payment of the Title Company's regularly-scheduled premium, the Title Policy. 6.2 Closing Date. Subject to the conditions precedent herein set forth, through an escrow established with the Title Company, Buyer and Seller shall consummate this transaction on the Scheduled Closing Date or such other date upon which Buyer and Seller may mutually agree. 6.3 Deposits And Deliveries By Seller. Subject to the terms and provisions of this Agreement, unless this Agreement is terminated by Buyer in accordance with the terms hereof, Seller shall deposit or cause to be deposited into escrow with the Title Company for delivery to Buyer or such person as Buyer shall designate, or deliver directly to Buyer outside of escrow, on or before the Scheduled Closing Date, the following documents duly executed and acknowledged as required: (a) The Deed. (b) A Bill of Sale and Assignment of Intangible Property in the form attached hereto as Exhibit F transferring the Personal Property and Intangible Property to Buyer (the "Bill of Sale"). (c) An Assignment and Assumption of Lease in the form attached as Exhibit G (the "Assignment and Assumption of Lease"). (d) An Affidavit of Non-Foreign Status in form attached hereto as Exhibit H (the "Non-Foreign Affidavit) and a California Form 593-W (the "California Affidavit"). (e) A Closing Certificate in the form of attached Exhibit O. (f) The Amended and Restated Parking Easement Agreement in the form attached hereto as Exhibit J or as otherwise approved in writing by Buyer. (g) Seller's written escrow instructions to close escrow in accordance with the terms of this Agreement. (h) The Development Indemnity Agreement in the form attached hereto as Exhibit S. (i) A Release in the form of the attached Exhibit U (the "Release"). (j) The WHTS Modification Indemnity (if the additional condition precedent described in Section 4(c)(ix) shall apply in accordance with Section 4(c)(viii)) in the form of Exhibit T. (k) Evidence reasonably acceptable to Buyer's counsel that the documents delivered to Buyer by Seller at closing have been duly authorized by Seller, and duly executed on behalf of Seller. (l) The letter of credit, and any proceeds thereof, held by Seller as security under the PMC Lease and not applied to defaults in accordance with the PMC Lease. (m) Wire transfer of immediately available funds in the amount of Seller's obligation pursuant to Section 5.3(f). (n) Such other documents, resolutions, consents and affidavits required to effect the valid consummation of the transaction evidenced by this Agreement. 6.4 Deposits And Deliveries By Buyer. Subject to the conditions precedent herein set forth, Buyer shall deposit or cause to be deposited into escrow with the Title Company for delivery to Seller or such person as Seller shall designate, or deliver directly to Seller outside of escrow, on or before the Scheduled Closing Date, each of the following documents duly executed and acknowledged as required and funds: (a) Wire transfer of immediately available funds, which, together with the Deposit, shall equal the Purchase Price (the "Purchase Funds"). (b) Cash, wire transfer, cashier's check, or other immediately available funds covering Buyer's share of closing costs and prorations. (c) The Assignment and Assumption of Contracts and Intangible Property. (d) A closing certificate confirming the accuracy and completeness, in all material respects, as of the Closing Date of each representation and warranty made herein by Buyer. (e) A Release in the form of the attached Exhibit U (the "Release"). (f) Buyer's written escrow instructions to close escrow in accordance with the terms of this Agreement. (g) Evidence reasonably acceptable to Seller's counsel that the documents delivered to Seller by Buyer at closing have been duly authorized by Buyer, and duly executed on behalf of Buyer. (h) Such other documents, resolutions, consents and affidavits required to effect the valid consummation of the transaction evidenced by this Agreement. 6.5 Closing. Upon satisfaction of the conditions to the Closing, the parties shall instruct the Title Company to close escrow by concurrently: (a) Recording and arranging for delivery to Buyer of the duly executed original Deed. (b) Issuing to Buyer the Title Policy. (c) Recording the originals of, and arranging for delivery to each of Buyer and Seller of one certified copy of the duly executed and recorded, Parking Easement Agreement and Development Indemnity Agreement and the subordinations and recognitions thereto required by Sections 4(c)(vi) and (x). (d) Delivering or arranging for delivery to Buyer of an original, duly executed Assignment of the PMC Lease, Bill of Sale, the Non-Foreign Affidavit, the California Affidavit, the Closing Certificate, WHTS Modification Indemnity (if applicable), the Reliance Letter, and the Release. (e) Delivering to Seller (or as directed by Seller) the Purchase Price as adjusted pursuant to the terms of this Agreement. (f) Taking of all actions, and delivering to Buyer and Seller of copies of all other documents and things deposited and/or delivered through escrow as directed by the parties pursuant to their mutually consistent escrow instruction. 6.6 Prorations. The costs and expenses of the Property shall be prorated as follows: (a) Upon delivery of the Release, (i) any and all rents (including, without limitation, operating expense escalation payments, and real estate tax escalation payments payable under the PMC Lease) ("Rents") and amounts payable by Tenant, shall be prorated between Seller and Buyer as of July 31, 2003 (i.e., Buyer shall not be entitled to the return of any July Rents paid by Tenant); (ii) if any Rents due for periods prior to July 31, 2003 have not been paid by Tenant, Seller shall receive a credit to the Purchase Price for such Rents; and (iii) Buyer shall receive a credit towards the Purchase Price for any overpayments or prepaid Rents. Any proration of rent or other sums shall be on the basis of the actual number of days of the month which shall have elapsed and a 365 day year. (b) All items subject to proration pertaining to the period prior to the Closing Date shall be credited to Seller, and all such prorations pertaining to the period on or following the Closing Date shall be credited to Buyer. Seller, Buyer and Title Company shall cooperate to produce prior to the Closing Date a schedule of prorations to be made as of the Closing Date as complete and accurate as reasonably possible. All prorations which can be liquidated accurately or reasonably estimated as of the Closing Date shall be made in escrow on the Closing Date. All other prorations, and adjustments to initial estimated prorations, shall be made by Buyer and Seller with due diligence and cooperation within 30 days following the Closing Date, or such later time as may be required to obtain necessary information for proration, by cash payment to the party yielding a net credit from such prorations from the other party. Such cash payment shall be made within ten (10) business days of demand for payment by the party entitled to receive such payment. (c) The provisions of this Section 6.6 shall survive the close of escrow. 6.7 Closing Costs. Seller shall pay (i) the cost of the County of Santa Clara transfer tax, (ii) the basic CLTA portion (with no endorsements) of the title insurance premiums for the title insurance described in the Title Commitment, (iii) one-half of all escrow fees, and (iv) Seller's legal fees and costs incurred in connection with the contemplated transaction. Buyer shall pay (i) the balance of the title insurance premium (including costs for endorsements), (ii) recording fees, (iii) one-half of all escrow fees, (iv) Buyer's legal fees and costs incurred in connection with the contemplated transaction, and (v) all costs and expenses incurred in connection with any financing obtained by Buyer, including without limitation, loan fees, mortgage recording taxes, financing costs and lender's legal fees. Any applicable city transfer tax shall be shared equally by Buyer and Seller. All other closing costs shall be borne by Seller and/or Buyer in the manner which is customary in the county where the Land is located. Notwithstanding the foregoing, if close of escrow fails to occur as a consequence of the default by a party, then such party shall pay all escrow fees and cancellation fees owing to the Title Company. 6.8 Possession. Right to possession of the Property shall transfer to Buyer on the Closing Date subject to the PMC Lease. 6.9 Filing Of Reports. Title Company shall be solely responsible for the timely filing of any reports or returns required pursuant to the provisions of Section 6045(e) of the Internal Revenue Code of 1986 (and any similar reports or returns required under any state or local laws) in connection with the closing of the transaction contemplated in this Agreement. 6.10 Cooperation. Without further consideration, each of Seller and Buyer shall execute, acknowledge and deliver to the other party on or after the Closing Date any and all other instruments or documents, and do and perform any other acts which may be required or which the other party may reasonably request in order to fully assign, transfer and/or convey to Buyer, and vest in Buyer, the Property, and each and every part and component thereof. 7. Liquidated Damages. BUYER AND SELLER HEREBY ACKNOWLEDGE AND AGREE THAT, IN THE EVENT THE TRANSACTION PROVIDED FOR IN THIS AGREEMENT FAILS DUE TO A DEFAULT BY BUYER OF AN OBLIGATION TO PURCHASE THE PROPERTY AFTER (i) ALL OF THE CONDITIONS TO THE BUYER'S OBLIGATION TO PURCHASE THE PROPERTY SHALL HAVE BEEN SATISFIED, OR WAIVED IN WRITING BY BUYER, AND (ii) THE SELLER SHALL HAVE PERFORMED, TENDERED, OR OFFERED TO TENDER, PERFORMANCE OF ALL OF ITS OBLIGATIONS, SELLER'S DAMAGES WOULD BE DIFFICULT OR IMPOSSIBLE TO DETERMINE AND THE AMOUNT OF THE DEPOSIT IS THE PARTIES' BEST AND MOST ACCURATE ESTIMATE OF THE DAMAGES SELLER WOULD SUFFER. ACCORDINGLY, THE PARTIES AGREE THAT, IN SUCH EVENT THE DEPOSIT SHALL BE PAID BY TITLE COMPANY TO SELLER AS LIQUIDATED DAMAGES UNDER THE FOREGOING CONDITIONS, AND THAT SUCH PAYMENT IS REASONABLE UNDER THE CIRCUMSTANCES EXISTING AS OF THE DATE OF THIS AGREEMENT. BUYER AND SELLER AGREE THAT THE SELLER'S RIGHT TO RETAIN THE DEPOSIT SHALL BE THE SOLE AND EXCLUSIVE REMEDY OF SELLER IN THE EVENT OF SUCH A BREACH OF THIS AGREEMENT BY BUYER FOLLOWING SATISFACTION OF SUCH CONDITIONS. ----------------------------- ---------------------------- BUYER SELLER 8. Damage And Destruction; Condemnation. Seller shall notify Buyer immediately of the occurrence of any damage to or destruction of the Property, or the institution or maintenance of any condemnation or similar proceedings with respect to the Property prior to the Closing Date of which Seller is aware. In the event of any damage to or destruction of the Property prior to the Closing Date for which the cost to repair in the aggregate exceeds $500,000, or in the event any condemnation or similar proceedings are instituted or maintained prior to the Closing Date, Buyer at its option either (i) may terminate this Agreement by written notice to Seller prior to the Scheduled Closing Date, or (ii) may consummate the purchase evidenced by this Agreement. With respect to any damage to or destruction of the Property prior to the Closing Date for which the cost to repair does not in the aggregate exceed $500,000, Buyer shall have no right to terminate this Agreement pursuant to the preceding sentence, this Agreement shall continue in accordance with its terms and the Purchase Price shall be reduced by the Restoration Funds (as defined below). As used herein, "Restoration Funds" shall mean an amount equal to the actual costs and expenses directly and indirectly related to the restoration of the Property, including the costs of permits less the actual proceeds of insurance assigned to Buyer at the Closing, but not exceeding the estimated cost of the restoration as reasonably determined and agreed upon by Buyer and Seller based on bids for a guaranteed maximum price contract for the restoration, which may include appropriate contingencies for cost overruns reasonably agreed upon by Buyer and Seller. If Buyer and Seller do not reasonably agree on the amount of the Restoration Funds and reasonable contingencies in connection therewith prior to the Closing Date, then Buyer shall have the right to terminate this Agreement as described above on or before the Closing Date. If this Agreement is not terminated by Buyer pursuant to this Section 8, then (i) Buyer shall accept possession of the Property in such damaged condition and/or subject to such condemnation or other proceeding on the Closing Date, (ii) as of the Closing Date, Seller shall assign to Buyer all insurance proceeds or condemnation proceeds received or to be received by Seller as a result of such damage or taking, and (iii), if applicable, the Purchase Price shall be reduced by the amount of the Restoration Funds. If this Agreement is so terminated by Buyer, then Buyer shall be entitled to an immediate return of the Deposit. 9. Commissions. Each party to this Agreement warrants to the other that, except to the extent payable solely by the warranting party, no person or entity can properly claim a right to a real estate commission, real estate finder's fee, real estate acquisition fee or other real estate brokerage-type compensation (collectively, "Real Estate Compensation") based upon the acts of that party with respect to the transaction contemplated by this Agreement, and each party hereby agrees to indemnify, defend and protect the other against and to hold the other harmless from any loss, cost or expense (including but not limited to attorneys' fees and returned commissions) resulting from any claim for Real Estate Compensation by any person or entity based upon such acts. 10. General Provisions. 10.1 Notices. Any notice required or permitted to be given under this Agreement shall be in writing and (i) personally delivered, (ii) sent by United States mail, registered or certified mail, postage prepaid, return receipt requested, (iii) sent by Federal Express or similar nationally recognized overnight courier service, or (iv) transmitted by facsimile with a hard copy sent within one (1) business day by any of the foregoing means, and in all cases addressed as follows, and such notice shall be deemed to have been given upon the date of actual receipt or delivery (or refusal to accept delivery) at the address specified below (or such other addresses as may be specified by notice in the foregoing manner) as indicated on the return receipt or air bill: TO SELLER: Tishman Speyer Properties, L.P. 525 Market Street, Suite 3720 San Francisco, California 94105 Attention: Carl Shannon Fax: (415) 536-4139 with a copy to: Tishman Speyer Properties 520 Madison Avenue New York, New York 10022 Attention: General Counsel Fax: (212) 935-8239 and Schulte Roth & Zabel LLP 919 Third Avenue New York, New York 10022 Attention: Jeffrey A. Lenobel, Esq. Fax: (212) 593-5955 and Whitehall Street Real Estate Limited Partnership IX 85 Broad Street New York, New York 10004 Attention: Patricia Geery Fax: (212) 357-5505 With a copy to: Mr. Todd Williams Goldman, Sachs & Co. 100 Crescent Court, Suite 1000 Dallas, TX 75201 Fax: (214) 855-6305 Stone Street Real Estate Fund 1998, L.P. 85 Broad Street New York, New York 10004 Fax: (212) 357-5505 Bridge Street Real Estate Fund 1998, L.P. 85 Broad Street New York, New York 10004 Fax: (212) 357-5505 Stone Street WHTS Corp. 85 Broad Street New York, New York 10004 Fax: (212) 357-5505 TO BUYER: PMC-Sierra, Inc. 8555 Baxter Place Burnaby, British Columbia V5A 4V7 Canada Attn: Manager, Corporate Real Estate and Facilities Fax: (604) 415-6161 with a copy to: Wilson Sonsini Goodrich & Rosati 650 Page Mill Road Palo Alto, California 94304 Attention: Norman Cruz, Esq. Fax: (650) 493-6811 10.2 Entire Agreement; No Modifications. This Agreement, together with the schedules and exhibits attached hereto, incorporates all agreements, warranties, representations and understandings between the parties to the Agreement with respect to the subject matter hereof and constitutes the entire agreement of Seller and Buyer with respect to the purchase and sale of the Property. Any prior or contemporaneous correspondence, memoranda, understandings, offers, negotiations and agreements, oral or written, are merged herein and replaced in total by this Agreement and the exhibits hereto and shall be of no further force or effect. This Agreement may not be modified or amended except in a writing signed by Seller and Buyer. 10.3 Time. Time is of the essence in the performance of the parties' respective obligations set forth in this Agreement. 10.4 Attorneys' Fees. In the event any action or proceeding at law or in equity between Buyer and Seller (including an action or proceeding between Buyer and the trustee or debtor in possession while Seller is a debtor in a proceeding under the Bankruptcy Code (Title 11 of the United States Code) or any successor statute to such Code) to enforce or interpret any provision of this Agreement or to protect or establish any right or remedy of either Buyer or Seller hereunder, the unsuccessful party to such action or proceeding shall pay to the prevailing party all costs and expenses including, without limitation, reasonable attorneys' and paralegals' fees and expenses, incurred by such prevailing party, in such action or proceeding and in any appeal in connection therewith, whether or not such action, proceeding or appeal is prosecuted to judgment or other final determination, together with all costs of enforcement and/or collection of any judgment or other relief. 10.5 Specific Performance. The parties understand and agree that the Property is unique and for that reason, among others, Buyer will be irreparably damaged in the event that this Agreement is not specifically enforced. Accordingly, in the event of any breach or default in or of this Agreement or any of the warranties, terms or provisions hereof by Seller, Buyer, in addition to a claim for damages for such breach or default (subject, however, to the limitations set forth in Section 5.1), and in addition and without prejudice to any right or remedy available at law or in equity, shall have the right (i) to seek to obtain specific performance of Seller's obligations hereunder, provided that any action for specific performance shall be commenced within sixty (60) days after such default. If Buyer elects to seek specific performance of this Agreement, then as a condition precedent to any suit for specific performance, Buyer shall on or before the Closing Date, time being of the essence, fully perform all of its obligations hereunder which are capable of being performed (other than the payment of the Purchase Price, which shall be paid as and when required by the court in the suit for specific performance). 10.6 Successors And Assigns. Except as permitted by this Section 10.6, this Agreement may not be assigned by Seller or Buyer without the prior written consent of the other party which may be granted or withheld by the other party in its sole discretion. Subject to the foregoing provision, this Agreement shall inure to the benefit of and be binding upon the parties to this Agreement and their respective successors and assigns. Buyer shall have the right to assign its rights and obligations under this Agreement to an affiliate of Buyer, provided that the assignee assumes for Seller's benefit all of Buyer's obligations hereunder. For the purposes of this Section 10.6, "affiliate of Buyer" shall mean an entity controlling, controlled by or under common control with Buyer. "Control" shall mean the possession, directly or indirectly, of the power to direct the management and policies of an entity, whether through the ownership of voting securities, by contract or otherwise. 10.7 Counterparts. This Agreement may be executed in one or more counterparts and each such counterpart shall be deemed to be an original; all counterparts so executed shall constitute one instrument and shall be binding on all of the parties to this Agreement notwithstanding that all of the parties are not signatories to the same counterpart. 10.8 Construction. This Agreement shall be governed by and construed under the laws of the State of California. The parties acknowledge that each party and its counsel have reviewed and revised this Agreement and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Agreement or any schedules or exhibits to it or any document executed and delivered by either party in connection with this Agreement. All captions in this Agreement are for reference only and shall not be used in the interpretation of this Agreement or any related document. If any provision of this Agreement shall be determined to be illegal or unenforceable, such determination shall not affect any other provision of this Agreement and all such other provisions shall remain in full force and effect. 10.9 Confidentiality. Seller shall keep all information obtained from or about Buyer or the transaction contemplated by this Agreement strictly confidential and will not disclose any such information to any other person or entity without first obtaining the prior written consent of Buyer. Notwithstanding anything to the contrary contained in this Agreement, Buyer and Buyer's Agents and Seller and Seller's Agents may disclose the tax treatment (i.e., the purported or claimed Federal income tax treatment) or the tax structure (i.e., any fact that may be relevant to understanding such treatment) of the transaction contemplated by this Agreement, and all materials of any kind (including opinions or other tax analyses) provided by Seller to Buyer relating to such tax treatment and tax structure. Furthermore, each of Buyer and Seller acknowledges and agrees that it has not made or provided a statement to the other party with respect to the tax consequences for the other party of the transactions contemplated by the Purchase Agreement. 10.10 Exculpation. Buyer agrees that it does not have and will not have any claims or causes of action against any disclosed or undisclosed officer, director, employee, trustee, shareholder, partner, member, principal, parent, subsidiary or other affiliate of Seller, including, without limitation, Tishman Speyer Properties, L.P. and Goldman, Sachs & Co., or any officer, director, employee, trustee, shareholder, member, partner or principal of any such parent, subsidiary or other affiliate (collectively, "Seller's Affiliates"), arising out of with this Agreement or the transactions contemplated hereby. Buyer agrees to look solely to Seller and its assets for the satisfaction of any liability or obligation arising under this Agreement or the transactions contemplated hereby, or for the performance of any of the covenants, warranties or other agreements contained herein, and further agrees not to sue or otherwise seek to enforce any personal obligation against any of Seller's Affiliates with respect to any matters arising out of this Agreement or the transactions contemplated hereby. The provisions of this Section 10.10, however, shall not apply to Tishman Speyer/Travelers Real Estate Venture, L.P. and Whitehall Street Real Estate Limited Partnership IX (collectively, the "Members") to the extent of the amount any of the Members has received from the proceeds of the transactions which is the subject of this Agreement, if the remaining funds available to Seller to satisfy the obligations of the Seller pursuant to this Agreement or the transactions contemplated hereby are not at least equal to Five Million Dollars ($5,000,000) or such lower amount of liability or potential liability as the Seller may have under such agreements. The provisions of this Section 10.10 shall survive the termination of this Agreement and the Closing. This Section 10.10 will not apply to the parties to the Parking Easement or the Development Indemnity Agreement to the extent such claim or cause of action relates solely to the Parking Easement Agreement or the Development Indemnity Agreement, as applicable. IN WITNESS WHEREOF, Buyer and Seller have executed this Agreement as of the date and year first written above: SELLER: WHTS FREEDOM CIRCLE PARTNERS II, L.L.C., a Delaware limited liability company By: Tishman Speyer/Travelers Real Estate Venture, L.P., a Delaware limited Partnership By: ____________________________________ Name: Title: and By: Whitehall Street Real Estate Limited Partnership IX, a Delaware limited liability partnership By: Whitehall Advisors, L.L.C. IX, a Delaware limited liability company, its general partner By: Whitehall Street IX/X, Inc., a Delaware corporation, its managing member By:_______________________ Name: Title: BUYER: PMC-SIERRA, INC., a Delaware corporation By: _____________________________________ Name: Title: