Common use of Disposition Obligations Clause in Contracts

Disposition Obligations. Subject to this Section 5.1 and the provisions of Section 5.2 hereof, the UPREIT shall use its good faith, reasonable and diligent efforts: 5.1.1. Not to sell or otherwise voluntarily dispose of any Project in a taxable transaction on or before the expiration of the Non-Taxable Disposition Period unless such sale or other voluntary disposition (other than through a deed in lieu of foreclosure, a foreclosure action, or an act of eminent domain) of any Project (and all assets received in exchange for such Project in which the REIT or the UPREIT has an adjusted tax basis substituted from that of such Project) qualifies for non-recognition of gain under the Code (for example, by means of exchanges contemplated under Code Sections 351, 354, 355, 368, 721, 1031 (but only if there is no "boot") or 1033), in such manner as the Code provides from time to time (the "NON-RECOGNITION CODE PROVISIONS"); provided, however, that the foregoing shall not require the REIT and UPREIT, in their sole and absolute discretion, to sell, or otherwise dispose of, or prevent the REIT and UPREIT, in their sole and absolute discretion, from selling or otherwise disposing of any Project in a transaction that would result in a loss for federal income tax purposes; 5.1.2. To maintain, on a continuous basis, an amount of indebtedness for which Contributor (including, for this purpose, the Interest Holders in Contributor or transferees of Contributor, collectively) bears, or is deemed to bear, the "economic risk of loss" within the meaning of Treasury Regulation Section 1.752-2(a) (including through the use of guarantee arrangements or arrangements providing for the imposition of a deficit restoration obligation on Contributor pursuant to an amendment to the Partnership Agreement) or which is allocated to Contributor pursuant to Treasury Regulation Section 1.752-3(a) equal to not less than $3,000,000 (the "MAXIMUM AMOUNT"); 5.1.3. To avoid a distribution of property that would cause Contributor to recognize income or gain pursuant to the provisions of either or both of Code Sections 704(c)(1)(B) and 737; 5.1.4. To avoid a termination of the UPREIT pursuant to the provisions of Code Section 708(b)(1)(B); and 5.1.5. As long as Contributor remains as a partner of the UPREIT, the REIT and/or UPREIT agree to utilize the "traditional method," without curative allocations (as contemplated for in the Partnership Agreement), of allocating gain and depreciation under Code Section 704(c) for the Projects. The provisions of this Section 5.1 shall survive the Closing.

Disposition Obligations. Subject to this Section 5.1 and 7(a), during the provisions of Section 5.2 hereofNon-Taxable Disposition Period, the UPREIT shall use Acquiror shall: (i) Use its good faith, reasonable and diligent efforts: 5.1.1. Not efforts to sell or otherwise voluntarily dispose of cause any Project in a taxable transaction on or before the expiration of the Non-Taxable Disposition Period unless such sale or other voluntary disposition (other than through a deed in lieu of foreclosure, a foreclosure action, or an act of eminent domain) of any Project the LP Interests (and all assets received in exchange for such Project LP Interests in which the REIT or the UPREIT Acquiror has an adjusted tax basis substituted from that of such ProjectLP Interests) qualifies to qualify for non-recognition of gain under the Code (for example, by means of exchanges contemplated under Code Sections 351, 354, 355, 368, 721, 1031 (but only if there is no "“boot"”) or 1033), in such the manner as the Code provides from time to time (the "NON“Non-RECOGNITION CODE PROVISIONS"Recognition Code Provisions”); provided, however, that if Acquiror is unable, after using its good faith, reasonable and diligent efforts, to structure any such sale or other disposition in a manner that qualifies for non-recognition under the foregoing Code, then Acquiror shall not require the REIT and UPREIT, be free in their its sole and absolute discretion, without any liability whatsoever hereunder or otherwise to sellany Contributor, to cause any sale or other voluntary disposition of the LP Interests (and all assets received in exchange for such LP Interests in which Acquiror has an adjusted tax basis substituted from that of such LP Interests) in a manner that does not qualify for non-recognition of gain under the Code; (ii) Cause the Acquired Partnership, by virtue of its rights as a limited partner (if any) to consent to any sale or transfer of the Property by the Acquired Partnership contained in the limited partnership agreement of the Acquired Partnership, to use its good faith, reasonable and diligent efforts in any sale or other voluntary disposition (other than through a deed in lieu of foreclosure, a foreclosure action, or otherwise dispose ofan act of eminent domain) of the Property (and all assets received in exchange for such Property in which the Acquired Partnership has an adjusted tax basis substituted from that of such Property) to qualify for non-recognition of gain under the Non-Recognition Code Provisions; provided, however, that if the Acquired Partnership is unable, after using its good faith, reasonable and diligent efforts, to structure any such sale or prevent other disposition in a manner that qualifies for non-recognition of gain under the REIT Non-Recognition Code Provisions, then Acquiror’s obligations hereunder shall cease in respect of the sale or other voluntary disposition of the Property (and UPREIT, all assets received in their sole and absolute discretion, from selling exchange for such Property in which the Acquired Partnership has an adjusted tax basis substituted for that of such Property) by the Acquired Partnership without any liability whatsoever hereunder or otherwise disposing of to any Project in a transaction that would result in a loss for federal income tax purposesContributor; 5.1.2. To maintain(iii) Use its good faith, on a continuous basis, an amount of indebtedness for which Contributor (including, for this purpose, the Interest Holders in Contributor or transferees of Contributor, collectively) bears, or is deemed reasonable and diligent efforts to bear, the "economic risk of loss" within the meaning of Treasury Regulation Section 1.752-2(a) (including through the use of guarantee arrangements or arrangements providing for the imposition of a deficit restoration obligation on Contributor pursuant to an amendment to the Partnership Agreement) or which is allocated to Contributor pursuant to Treasury Regulation Section 1.752-3(a) equal to not less than $3,000,000 (the "MAXIMUM AMOUNT"); 5.1.3. To avoid a distribution of property that would cause Contributor Xxxx to recognize income or gain in excess of $250,000 pursuant to the provisions of either or both of Code Sections 704(c)(1)(B) and 737, provided, further, that, if Acquiror is unable, after using its good faith, reasonable and diligent efforts, to structure any disposition of property in a manner that will not cause Xxxx to recognize income or gain in excess of $250,000 pursuant to the provisions of either or both of Code Sections 704(c)(1)(B) and 737, then Acquiror shall be free in its sole and absolute discretion, without any liability whatsoever hereunder or otherwise to Xxxx, to complete the disposition of property in a manner that will cause Xxxx to recognize income or gain in excess of $250,000 pursuant to the provisions of either or both of Code Sections 704(c)(1)(B) and 737; 5.1.4. To avoid a termination of the UPREIT pursuant to the provisions of Code Section 708(b)(1)(B); and 5.1.5. (iv) As long as Contributor Xxxx remains as a partner of the UPREITAcquiror, the REIT and/or UPREIT agree Acquiror agrees to utilize the "“traditional method," ” without curative allocations (as contemplated for in the Partnership Agreement), of allocating gain and depreciation under Code Section 704(c) for the ProjectsLP Interests or Property, if applicable. The In all events, the Non-Taxable Disposition Period shall terminate, and the provisions of this Section 5.1 7 only shall survive automatically be rendered null and void and shall be of no further force or effect, as of the Closingoccurrence of an amendment or other material revision to Code Section 1031 or the Treasury Regulations promulgated thereunder, which amendment or revision materially and, with respect to the REIT and Acquiror, adversely alters the tax-treatment of “like-kind” exchanges of real estate pursuant to such provisions.

Disposition Obligations. Subject to this Section 5.1 6(a) and the provisions of Section 5.2 6(b) hereof, during the UPREIT shall use Non-Taxable Disposition Period, Acquiror shall: (i) Use its good faith, reasonable and diligent efforts: 5.1.1. Not efforts to sell or otherwise voluntarily dispose of cause any Project in a taxable transaction on or before the expiration of the Non-Taxable Disposition Period unless such sale or other voluntary disposition (other than through a deed in lieu of foreclosure, a foreclosure action, or an act of eminent domain) of any Project Property (and all assets received in exchange for such Project Property in which the REIT or the UPREIT Acquiror has an adjusted tax basis substituted from that of such ProjectProperty) qualifies to qualify for non-recognition of gain under the Code (for example, by means of exchanges contemplated under Code Sections 351, 354, 355, 368, 721, 1031 (but only if there is no "boot") or 1033), in such the manner as the Code provides from time to time (the "NONNon-RECOGNITION CODE PROVISIONSRecognition Code Provisions"); provided, however, that if Acquiror is unable, after using its good faith, reasonable and diligent efforts, to structure any such sale or other disposition in a manner that qualifies for non-recognition of gain under the foregoing Code, then Acquiror shall not require the REIT and UPREIT, be free in their its sole and absolute discretion, to sell, without any liability whatsoever hereunder or otherwise dispose ofto Xxxxxxxx or any Affiliate of Xxxxxxxx, to cause any sale or prevent other voluntary disposition of the Property (and all assets received in exchange for such Property in which the REIT and UPREIT, in their sole and absolute discretion, from selling or otherwise disposing Acquiror has an adjusted tax basis substituted for that of any Project such Property) in a transaction manner that would result in a loss does not qualify for federal income tax purposesnon-recognition of gain under the Code; 5.1.2. To maintain(ii) Maintain, on a continuous basis, an amount of indebtedness for which Contributor Xxxxxxxx (including, for this purpose, the Interest Holders in Contributor or transferees of Contributor, collectivelyXxxxxxxx so long as such transferees are identified by notice to Acquiror) bears, or is deemed to bear, the "economic risk of loss" within the meaning of Treasury Regulation Section 1.752-2(a) (including through the use of guarantee arrangements or arrangements providing for the imposition of a deficit restoration obligation on Contributor Contributors pursuant to an amendment to the Partnership Agreement) or which is allocated to Contributor pursuant to Treasury Regulation Section 1.752-3(a) equal to not less than Forty Million Dollars ($3,000,000 40,000,000) (the "MAXIMUM AMOUNTMinimum Amount"); 5.1.3. To (iii) Use its good faith, reasonable and diligent efforts to avoid a distribution of property that would cause Contributor Xxxxxxxx to recognize income or gain in excess of $250,000 pursuant to the provisions of either or both of Code Sections 704(c)(1)(B) and 737, provided, further, that, if Acquiror is unable, after using its good faith, reasonable and diligent efforts, to structure any disposition of property in a manner that will not cause Xxxxxxxx to recognize income or gain in excess of $250,000 pursuant to the provisions of either or both of Code Sections 704(c)(1)(B) and 737, then Acquiror shall be free in its sole and absolute discretion, without any liability whatsoever hereunder or otherwise to Xxxxxxxx, to complete disposition of property in a manner that will cause Xxxxxxxx to recognize income or gain in excess of $250,000 pursuant to the provisions of either or both of Code Sections 704(c)(1)(B) and 737; 5.1.4. To avoid a termination of the UPREIT pursuant to the provisions of Code Section 708(b)(1)(B); and 5.1.5. (iv) As long as Contributor Xxxxxxxx remains as a partner of the UPREITAcquiror, the REIT and/or UPREIT agree Acquiror agrees to utilize the "traditional method," without curative allocations (as contemplated for in the Partnership Agreement), of allocating gain and depreciation under Code Section 704(c) for each Property other than the ProjectsReno Property, and to utilize the "remedial method" of allocating gain and depreciation under Code Section 704(c) for the Reno Property. The In all events, the Non-Taxable Disposition Period shall terminate, and the provisions of this Section 5.1 6 only shall survive automatically be rendered null and void and shall be of no further force or effect, as of the Closingoccurrence of an amendment or other material revision to Code Section 1031 or the Treasury Regulations promulgated thereunder, which amendment or revision materially and, with respect to the REIT and Acquiror, adversely alters the tax-treatment of "like-kind" exchanges of real estate pursuant to such provisions.

Disposition Obligations. Subject to this Section 5.1 6(a) and the provisions of Section 5.2 6(b) hereof, the UPREIT as long as any of Contributor’s Beneficial Holders remains as a limited partner of Acquiror, Acquiror shall use its good faith, reasonable and diligent efforts: 5.1.1. (i) Not to sell or otherwise voluntarily dispose of any Project the Property in a taxable transaction on or before the expiration of the Non-Taxable Disposition Period unless (i) Acquiror complies, in connection with such sale or other disposition, with Section 6(c) hereof, or (ii) such sale or other voluntary disposition (other than through a deed in lieu of foreclosure, a foreclosure action, or an act of eminent domain) of any Project the Property (and all assets received in exchange for such Project the Property in a transaction in which the REIT Gramercy or the UPREIT Acquiror has an adjusted tax basis substituted from that of such Projectdetermined by reference to its adjusted tax basis in the Property) qualifies for non-recognition of gain under the Internal Revenue Code (for example, by means of exchanges contemplated under Internal Revenue Code Sections 351, 354, 355, 368, 721, 1031 (but only if there is no "boot") or 1033, if such exchange does not result in the receipt of “boot”), in such manner as the Internal Revenue Code provides from time to time (the "NON-RECOGNITION CODE PROVISIONS")time; provided, however, that the foregoing shall not require the REIT and UPREITGramercy or Acquiror, in their sole and absolute discretion, to sell, or otherwise dispose of, or prevent the REIT and UPREITGramercy or Acquiror, in their sole and absolute discretion, from selling or otherwise disposing of any Project the Property in a transaction that would result in a loss for federal income tax purposes; 5.1.2. (ii) To maintain, on a continuous basis, an amount of indebtedness for which Contributor (including, for this purposebasis during the Non-Taxable Disposition Period, the Interest Holders in Contributor or transferees of Contributorexisting nonrecourse indebtedness securing the Property or, collectively) bears, or to the extent that such indebtedness is deemed to bearrefinanced, the "economic risk of loss" within the meaning of Treasury Regulation Section 1.752-2(a) (including through the use of guarantee arrangements or arrangements providing for the imposition of replacement indebtedness shall be nonrecourse and have a deficit restoration obligation on Contributor pursuant to an amendment to the Partnership Agreement) or which principal balance that is allocated to Contributor pursuant to Treasury Regulation Section 1.752-3(a) equal to not less than $3,000,000 (and does not amortize more rapidly than) the "MAXIMUM AMOUNT")principal balance of the existing indebtedness, except to the extent a lesser principal balance (or faster amortization rate) would not cause additional or accelerated gain recognition by any of Contributor’s Beneficial Owners; 5.1.3. (iii) To avoid a distribution of property that would cause Contributor Contributor’s Beneficial Holders to recognize income or gain pursuant to the provisions of either or both of Internal Revenue Code Sections 704(c)(1)(B) and 737; 5.1.4. (iv) To avoid a termination of the UPREIT Acquiror pursuant to the provisions of Internal Revenue Code Section 708(b)(1)(B); and 5.1.5. As long as Contributor remains as a partner of the UPREIT, the REIT and/or UPREIT agree to (v) To utilize the "“traditional method," ” without curative allocations (as contemplated for in the Partnership Agreement), of allocating gain and depreciation under Internal Revenue Code Section 704(c) for with respect to the ProjectsProperty. The provisions of this Section 5.1 6(a) shall survive the ClosingClosing and, to the extent applicable, inure to the benefit of Contributor’s Beneficial Holders as third party beneficiaries.

Disposition Obligations. Subject to this Section 5.1 and 7(a), during the provisions of Section 5.2 hereofNon-Taxable Disposition Period, the UPREIT shall use Acquiror shall: (i) Use its good faith, reasonable and diligent efforts: 5.1.1. Not efforts to sell or otherwise voluntarily dispose of cause any Project in a taxable transaction on or before the expiration of the Non-Taxable Disposition Period unless such sale or other voluntary disposition (other than through a deed in lieu of foreclosure, a foreclosure action, or an act of eminent domain) of any Project the Membership Interests (and all assets received in exchange for such Project Membership Interests in which the REIT or the UPREIT Acquiror has an adjusted tax basis substituted from that of such ProjectMembership Interests) qualifies to qualify for non-recognition of gain under the Code (for example, by means of exchanges contemplated under Code Sections 351, 354, 355, 368, 721, 1031 (but only if there is no "“boot"”) or 1033), in such the manner as the Code provides from time to time (the "NON“Non-RECOGNITION CODE PROVISIONS"Recognition Code Provisions”); provided, however, that if Acquiror is unable, after using its good faith, reasonable and diligent efforts, to structure any such sale or other disposition in a manner that qualifies for non-recognition under the foregoing Code, then Acquiror shall not require the REIT and UPREIT, be free in their its sole and absolute discretion, without any liability whatsoever hereunder or otherwise to sellany Contributor, to cause any sale or other voluntary disposition of the Membership Interests (and all assets received in exchange for such Membership Interests in which Acquiror has an adjusted tax basis substituted from that of such Membership Interests) in a manner that does not qualify for non-recognition of gain under the Code; (ii) Cause the Acquired Company, by virtue of its rights as a limited partner (if any) to consent to any sale or transfer of the Property by the Acquired Company contained in the limited partnership agreement of the Acquired Company, to use its good faith, reasonable and diligent efforts in any sale or other voluntary disposition (other than through a deed in lieu of foreclosure, a foreclosure action, or otherwise dispose ofan act of eminent domain) of the Property (and all assets received in exchange for such Property in which the Acquired Company has an adjusted tax basis substituted from that of such Property) to qualify for non-recognition of gain under the Non-Recognition Code Provisions; provided, however, that if the Acquired Company is unable, after using its good faith, reasonable and diligent efforts, to structure any such sale or prevent other disposition in a manner that qualifies for non-recognition of gain under the REIT Non-Recognition Code Provisions, then Acquiror’s obligations hereunder shall cease in respect of the sale or other voluntary disposition of the Property (and UPREIT, all assets received in their sole and absolute discretion, from selling exchange for such Property in which the Acquired Company has an adjusted tax basis substituted for that of such Property) by the Acquired Company without any liability whatsoever hereunder or otherwise disposing of to any Project in a transaction that would result in a loss for federal income tax purposesContributor; 5.1.2. To maintain(iii) Use its good faith, on a continuous basis, an amount of indebtedness for which Contributor (including, for this purpose, the Interest Holders in Contributor or transferees of Contributor, collectively) bears, or is deemed reasonable and diligent efforts to bear, the "economic risk of loss" within the meaning of Treasury Regulation Section 1.752-2(a) (including through the use of guarantee arrangements or arrangements providing for the imposition of a deficit restoration obligation on Contributor pursuant to an amendment to the Partnership Agreement) or which is allocated to Contributor pursuant to Treasury Regulation Section 1.752-3(a) equal to not less than $3,000,000 (the "MAXIMUM AMOUNT"); 5.1.3. To avoid a distribution of property that would cause Contributor Xxxx to recognize income or gain in excess of $250,000 pursuant to the provisions of either or both of Code Sections 704(c)(1)(B) and 737, provided, further, that, if Acquiror is unable, after using its good faith, reasonable and diligent efforts, to structure any disposition of property in a manner that will not cause Xxxx to recognize income or gain in excess of $250,000 pursuant to the provisions of either or both of Code Sections 704(c)(1)(B) and 737, then Acquiror shall be free in its sole and absolute discretion, without any liability whatsoever hereunder or otherwise to Xxxx, to complete the disposition of property in a manner that will cause Xxxx to recognize income or gain in excess of $250,000 pursuant to the provisions of either or both of Code Sections 704(c)(1)(B) and 737; 5.1.4. To avoid a termination of the UPREIT pursuant to the provisions of Code Section 708(b)(1)(B); and 5.1.5. (iv) As long as Contributor Xxxx remains as a partner of the UPREITAcquiror, the REIT and/or UPREIT agree Acquiror agrees to utilize the "“traditional method," ” without curative allocations (as contemplated for in the Partnership Agreement), of allocating gain and depreciation under Code Section 704(c) for the ProjectsMembership Interests or Property, if applicable. The In all events, the Non-Taxable Disposition Period shall terminate, and the provisions of this Section 5.1 7 only shall survive automatically be rendered null and void and shall be of no further force or effect, as of the Closingoccurrence of an amendment or other material revision to Code Section 1031 or the Treasury Regulations promulgated thereunder, which amendment or revision materially and, with respect to the REIT and Acquiror, adversely alters the tax-treatment of “like-kind” exchanges of real estate pursuant to such provisions.