Common use of Independent REIT Review Clause in Contracts

Independent REIT Review. Upon receipt of a joint written notice (the “Initial Qualification Notice”) from both the iStar Representative and the BREDS Representative that, based on the advice of an independent accounting or law firm (the “First Investors’ Independent Advisor”) selected by the iStar Representative and the BREDS Representative, the Company is likely to fail to qualify, or does not qualify, as a REIT under the Code, the Company and its independent accounting or law firm (the “Company’s Independent Advisor”) and the First Investors’ Independent Advisor shall consult with each other in good faith regarding the advice of the First Investors’ Independent Advisor and the basis therefor and receive and discuss any position of the Company and the Company’s Independent Advisor to the contrary, for a period of not less than 10 Business Days after the date of the Initial Qualification Notice (as the same may be extended by the agreement of the Company and the Representatives, the “REIT Consultation Period”). If at the end of the REIT Consultation Period, or sooner upon the mutual agreement of the Company’s Independent Advisor and the First Investors’ Independent Advisor, the Company’s Independent Advisor agrees with the First Investors’ Independent Advisor, the Company shall notify the holders of Series D Preferred Stock in writing promptly, and in no event later than five Business Days after the expiration of the REIT Consultation Period (or the earlier date upon mutual agreement of the Company’s Independent Advisor and the First Investors’ Independent Advisor), that a REIT Determination Event has occurred. If, on the other hand, the Company’s Independent Advisor disagrees with the First Investors’ Independent Advisor on whether the Company is likely to fail, or fails, to qualify as a REIT, the Company and the Representatives shall jointly retain Deloitte & Touche LLP to provide an independent determination of the matter; provided, however, that if Deloitte & Touche LLP is then serving as the independent auditor for any of the Company or the Representatives or refuses the assignment, then the Company and the Representatives shall instead jointly retain KPMG LLP; provided, however, that if KPMG LLP is then serving as the independent auditor for any of the Company or the Representatives or refuses the assignment, the Company and the Representatives shall mutually agree on a new independent law or accounting firm (Deloitte & Touche LLP, KPMG LLP or such new independent law or accounting firm, the “Second Investors’ Independent Advisor”) within 30 days after the end of the REIT Consultation Period to make a final determination on the matter, and if they are unable to agree on such new firm within such 30-day period, the Second Investors’ Independent Advisor shall be an independent law or accounting firm experienced in REIT tax matters selected by the Representatives within 10 days after the end of such 30-day period. The Second Investors’ Independent Advisor shall render a final decision within 30 days after being retained for such purpose and the decision of the Second Investors’ Independent Advisor shall be final, binding and conclusive on the Company and the holders of Series D Preferred Stock for all purposes. The Company shall, and shall cause its tax advisors to, and the holders of Series D Preferred Stock shall, and shall cause their tax advisors to, cooperate with each other during the course of the Independent REIT Review and provide each other with such documents supporting their respective positions as are reasonably requested. All costs, fees and expenses incurred by the Representatives, the holders of Series D Preferred Stock, the Company, the First Investors’ Independent Advisor, the Company’s Independent Advisor, the Second Investors’ Independent Advisor or any other officers, directors, equityholder, employees, advisors (including lawyers) or other agents and representatives in connection with this Section 2(c) shall be borne solely by the Company, if it is determined that a REIT Determination Event has occurred, and one-half by the Company, on the one hand, and one-half by the iStar Representative and the BREDS Representative, on the other hand, if it is determined that no REIT Determination Event shall have occurred. For purposes of this Section 2(c), whether the Company fails or is likely to fail to qualify as a REIT shall be determined without any mitigation provisions available to the Company under the Code (e.g., the ability of the Company to retain its status as a REIT upon the payment of tax) unless (i) the amount of any penalty or interest required to be paid to the benefit from such savings or mitigation provision is included in the aggregate of all of the line item variances as set forth in the definition of “Permitted Budget Variance” and does not and could not reasonably be expected to cause the aggregate of all line item variances to exceed 10% of the total expenses in the Approved Budget; and (ii) the Company’s tax counsel has issued an opinion to the Company stating that the Company satisfies any reasonable cause requirement of such mitigation provision, and such opinion does not rely upon a representation that the Company acted with “ordinary care and business prudence” but shall instead rely upon representations regarding the facts specific to any issues requiring such mitigation provision.

Independent REIT Review. Upon receipt of a joint written notice (the “Initial Qualification Notice”) from both the iStar Series E Representative and the BREDS Series E Representative that, based on the advice of an independent accounting or law firm (the “First Investors’ Independent Advisor”) selected by the iStar Series E Representative and the BREDS Series E Representative, the Company is likely to fail to qualify, or does not qualify, as a REIT under the Code, the Company and its independent accounting or law firm (the “Company’s Independent Advisor”) and the First Investors’ Independent Advisor shall consult with each other in good faith regarding the advice of the First Investors’ Independent Advisor and the basis therefor and receive and discuss any position of the Company and the Company’s Independent Advisor to the contrary, for a period of not less than 10 Business Days after the date of the Initial Qualification Notice (as the same may be extended by the agreement of the Company and the Representatives, the “REIT Consultation Period”). If at the end of the REIT Consultation Period, or sooner upon the mutual agreement of the Company’s Independent Advisor and the First Investors’ Independent Advisor, the Company’s Independent Advisor agrees with the First Investors’ Independent Advisor, the Company shall notify the holders of the Series D E Preferred Stock in writing promptly, and in no event later than five Business Days after the expiration of the REIT Consultation Period (or the earlier date upon mutual agreement of the Company’s Independent Advisor and the First Investors’ Independent Advisor), that a REIT Determination Event has occurred. If, on the other hand, the Company’s Independent Advisor disagrees with the First Investors’ Independent Advisor on whether the Company is likely to fail, or fails, to qualify as a REIT, the Company and the Representatives shall jointly retain Deloitte & Touche LLP to provide an independent determination of the matter; provided, however, that if Deloitte & Touche LLP is then serving as the independent auditor for any of the Company or the Representatives or refuses the assignment, then the Company and the Representatives shall instead jointly retain KPMG LLP; provided, however, that if KPMG LLP is then serving as the independent auditor for any of the Company or the Representatives or refuses the assignment, the Company and the Representatives shall mutually agree on a new independent law or accounting firm (Deloitte & Touche LLP, KPMG LLP or such new independent law or accounting firm, the “Second Investors’ Independent Advisor”) within 30 days after the end of the REIT Consultation Period to make a final determination on the matter, and if they are unable to agree on such new firm within such 30-day period, the Second Investors’ Independent Advisor shall be an independent law or accounting firm experienced in REIT tax matters selected by the Representatives within 10 days after the end of such 30-day period. The Second Investors’ Independent Advisor shall render a final decision within 30 days after being retained for such purpose and the decision of the Second Investors’ Independent Advisor shall be final, binding and conclusive on the Company and the holders of the Series D E Preferred Stock for all purposes. The Company shall, and shall cause its tax advisors to, and the holders of the Series D E Preferred Stock shall, and shall cause their tax advisors to, cooperate with each other during the course of the Independent REIT Review and provide each other with such documents supporting their respective positions as are reasonably requested. All costs, fees and expenses incurred by the Representatives, the holders of Series D E Preferred Stock, the Company, the First Investors’ Independent Advisor, the Company’s Independent Advisor, the Second Investors’ Independent Advisor or any other officers, directors, equityholderequityholders, employees, advisors (including lawyers) or other agents and representatives in connection with this Section 2(c) shall be borne solely by the Company, if it is determined that a REIT Determination Event has occurred, and one-half by the Company, on the one hand, and one-half by the iStar Series E Representative and the BREDS Series E Representative, on the other hand, if it is determined that no REIT Determination Event shall have occurred. For purposes of this Section 2(c), whether the Company fails or is likely to fail to qualify as a REIT shall be determined without any savings or mitigation provisions available to the Company under the Code (e.g., the ability of the Company to retain its status as a REIT upon the payment of tax) unless (i) the amount of any penalty or interest required to be paid to the benefit from such savings or mitigation provision is included in the aggregate of all of the line item variances as set forth in the definition of “Permitted Budget Variance” and does not and could not reasonably be expected to cause the aggregate of all line item variances to exceed 10% of the total expenses in the Approved Budget; and (ii) the Company’s tax counsel has issued an opinion to the Company stating that the Company satisfies any reasonable cause requirement of such savings or mitigation provision, and such opinion does not rely upon a representation that the Company acted with “ordinary care and business prudence” but shall instead rely upon representations regarding the facts specific to any issues requiring such savings or mitigation provision.

Independent REIT Review. Upon receipt of a joint written notice (the “Initial Qualification Notice”) from both the iStar Representative and the BREDS Representative that, based on the advice of an independent accounting or law firm (the “First Investors’ Independent Advisor”) selected by the iStar Representative and the BREDS Representativesuch Representatives, the Company General Partner is likely to fail to qualify, or does not qualify, as a REIT under the Code, the Company General Partner and its independent accounting or law firm (the “CompanyGeneral Partner’s Independent Advisor”) and the First Investors’ Independent Advisor shall consult with each other in good faith regarding the advice of the First Investors’ Independent Advisor and the basis therefor and receive and discuss any position of the Company General Partner and the CompanyGeneral Partner’s Independent Advisor to the contrary, for a period of not less than 10 Business Days after the date of the Initial Qualification Notice (as the same may be extended by the agreement of the Company General Partner and the Representatives, the “REIT Consultation Period”). If at the end of the REIT Consultation Period, or sooner upon the mutual agreement of the CompanyGeneral Partner’s Independent Advisor and the First Investors’ Independent Advisor, the CompanyGeneral Partner’s Independent Advisor agrees with the First Investors’ Independent Advisor, the Company General Partner shall notify the holders of the Series D E Preferred Stock Partnership Units in writing promptly, and in no event later than five Business Days after the expiration of the REIT Consultation Period (or the earlier date upon mutual agreement of the CompanyGeneral Partner’s Independent Advisor and the First Investors’ Independent Advisor), that a REIT Determination Event has occurred. If, on the other hand, the CompanyGeneral Partner’s Independent Advisor disagrees with the First Investors’ Independent Advisor on whether the Company General Partner is likely to fail, or fails, to qualify as a REIT, the Company General Partner and the Representatives shall jointly retain Deloitte & Touche LLP to provide an independent determination of the matter; provided, however, that if Deloitte & Touche LLP is then serving as the independent auditor for any of the Company General Partner or the Representatives or refuses the assignment, then the Company General Partner and the Representatives shall instead jointly retain KPMG LLP; provided, however, that if KPMG LLP is then serving as the independent auditor for any of the Company General Partner or the Representatives or refuses the assignment, the Company General Partner and the Representatives shall mutually agree on a new independent law or accounting firm (Deloitte & Touche LLP, KPMG LLP or such new independent law or accounting firm, the “Second Investors’ Independent Advisor”) within 30 days after the end of the REIT Consultation Period to make a final determination on the matter, and if they are unable to agree on such new firm within such 30-day period, the Second Investors’ Independent Advisor shall be an independent law or accounting firm experienced in REIT tax matters selected by the Representatives within 10 days after the end of such 30-day period. The Second Investors’ Independent Advisor shall render a final decision within 30 days after being retained for such purpose and the decision of the Second Investors’ Independent Advisor shall be final, binding and conclusive on the Company General Partner and the holders of the Series D E Preferred Stock Partnership Units for all purposes. The Company General Partner shall, and shall cause its tax advisors to, and the holders of the Series D E Preferred Stock Partnership Units shall, and shall cause their tax advisors to, cooperate with each other during the course of the Independent REIT Review and provide each other with such documents supporting their respective positions as are reasonably requested. All costs, fees and expenses incurred by the Representatives, the holders of Series D E Preferred StockPartnership Units, the CompanyGeneral Partner, the First Investors’ Investor’s Independent Advisor, the CompanyGeneral Partner’s Independent Advisor, the Second Investors’ Independent Advisor or any other officers, directors, equityholderequityholders, employees, advisors (including lawyers) or other agents and representatives in connection with this Section 2(c8(g) shall be borne solely by the CompanyGeneral Partner, if it is determined that a REIT Determination Event has occurred, and one-half by the CompanyGeneral Partner, on the one hand, and one-half by the iStar Representative and the BREDS Representative, pro rata, on the other hand, if it is determined that no REIT Determination Event shall have occurred. For purposes of this Section 2(c8(g), whether the Company General Partner fails or is likely to fail to qualify as a REIT shall be determined without any mitigation provisions available to the Company General Partner under the Code (e.g., the ability of the Company General Partner to retain its status as a REIT upon the payment of tax) unless (i) the amount of any penalty or interest required to be paid to the benefit from such savings or mitigation provision is included in the aggregate of all of the line item variances as set forth in the definition of “Permitted Budget Variance” and does not and could not reasonably be expected to cause the aggregate of all line item variances to exceed 10% of the total expenses in the Approved Budget; and (ii) the CompanyGeneral Partner’s tax counsel has issued an opinion to the Company General Partner stating that the Company General Partner satisfies any reasonable cause requirement of such savings or mitigation provision, and such opinion does not rely upon a representation that the Company General Partner acted with “ordinary care and business prudence” but shall instead rely upon representations regarding the facts specific to any issues requiring such savings or mitigation provision.

Independent REIT Review. Upon receipt of a joint written notice (the “Initial Qualification Notice”) from both the iStar Representative and the BREDS Representative that, based on the advice of an independent accounting or law firm (the “First Investors’ Independent Advisor”) selected by the iStar Representative and the BREDS Representativesuch Representatives, the Company General Partner is likely to fail to qualify, or does not qualify, as a REIT under the Code, the Company General Partner and its independent accounting or law firm (the “CompanyGeneral Partner’s Independent Advisor”) and the First Investors’ Independent Advisor shall consult with each other in good faith regarding the advice of the First Investors’ Independent Advisor and the basis therefor and receive and discuss any position of the Company General Partner and the CompanyGeneral Partner’s Independent Advisor to the contrary, for a period of not less than 10 Business Days after the date of the Initial Qualification Notice (as the same may be extended by the agreement of the Company General Partner and the Representatives, the “REIT Consultation Period”). If at the end of the REIT Consultation Period, or sooner upon the mutual agreement of the CompanyGeneral Partner’s Independent Advisor and the First Investors’ Independent Advisor, the CompanyGeneral Partner’s Independent Advisor agrees with the First Investors’ Independent Advisor, the Company General Partner shall notify the holders of the Series D Preferred Stock Partnership Units in writing promptly, and in no event later than five Business Days after the expiration of the REIT Consultation Period (or the earlier date upon mutual agreement of the CompanyGeneral Partner’s Independent Advisor and the First Investors’ Independent Advisor), that a REIT Determination Event has occurred. If, on the other hand, the CompanyGeneral Partner’s Independent Advisor disagrees with the First Investors’ Independent Advisor on whether the Company General Partner is likely to fail, or fails, to qualify as a REIT, the Company General Partner and the Representatives shall jointly retain Deloitte & Touche LLP to provide an independent determination of the matter; provided, however, that if Deloitte & Touche LLP is then serving as the independent auditor for any of the Company General Partner or the Representatives or refuses the assignment, then the Company General Partner and the Representatives shall instead jointly retain KPMG LLP; provided, however, that if KPMG LLP is then serving as the independent auditor for any of the Company General Partner or the Representatives or refuses the assignment, the Company General Partner and the Representatives shall mutually agree on a new independent law or accounting firm (Deloitte & Touche LLP, KPMG LLP or such new independent law or accounting firm, the “Second Investors’ Independent Advisor”) within 30 days after the end of the REIT Consultation Period to make a final determination on the matter, and if they are unable to agree on such new firm within such 30-day period, the Second Investors’ Independent Advisor shall be an independent law or accounting firm experienced in REIT tax matters selected by the Representatives within 10 days after the end of such 30-day period. The Second Investors’ Independent Advisor shall render a final decision within 30 days after being retained for such purpose and the decision of the Second Investors’ Independent Advisor shall be final, binding and conclusive on the Company General Partner and the holders of the Series D Preferred Stock Partnership Units for all purposes. The Company General Partner shall, and shall cause its tax advisors to, and the holders of the Series D Preferred Stock Partnership Units shall, and shall cause their tax advisors to, cooperate with each other during the course of the Independent REIT Review and provide each other with such documents supporting their respective positions as are reasonably requested. All costs, fees and expenses incurred by the Representatives, the holders of Series D Preferred StockPartnership Units, the CompanyGeneral Partner, the First Investors’ Investor’s Independent Advisor, the CompanyGeneral Partner’s Independent Advisor, the Second Investors’ Independent Advisor or any other officers, directors, equityholderequityholders, employees, advisors (including lawyers) or other agents and representatives in connection with this Section 2(c8(g) shall be borne solely by the CompanyGeneral Partner, if it is determined that a REIT Determination Event has occurred, and one-half by the CompanyGeneral Partner, on the one hand, and one-half half, pro rata, by the iStar Representative and the BREDS Representative, pro rata, on the other hand, if it is determined that no REIT Determination Event shall have occurred. For purposes of this Section 2(c8(g), whether the Company General Partner fails or is likely to fail to qualify as a REIT shall be determined without any mitigation provisions available to the Company General Partner under the Code (e.g., the ability of the Company General Partner to retain its status as a REIT upon the payment of tax) unless (i) the amount of any penalty or interest required to be paid to the benefit from such savings or mitigation provision is included in the aggregate of all of the line item variances as set forth in the definition of “Permitted Budget Variance” and does not and could not reasonably be expected to cause the aggregate of all line item variances to exceed 10% of the total expenses in the Approved Budget; and (ii) the CompanyGeneral Partner’s tax counsel has issued an opinion to the Company General Partner stating that the Company General Partner satisfies any reasonable cause requirement of such savings or mitigation provision, and such opinion does not rely upon a representation that the Company General Partner acted with “ordinary care and business prudence” but shall instead rely upon representations regarding the facts specific to any issues requiring such savings or mitigation provision.