Common use of Representation and Warranty Insurance Clause in Contracts

Representation and Warranty Insurance. Buyer may elect to obtain a buy- side representations and warranties insurance policy for its benefit (and its sole cost and expense) in respect of the Transaction (the “R&W Insurance Policy”). If Buyer obtains an R&W Insurance Policy, Xxxxx will confirm that the R&W Insurance Policy includes a provision stating that the insurer(s) thereunder (the “R&W Insurer”) will not receive and will irrevocably and unconditionally waive, and agree not to bring any action, or pursue or exercise, directly or indirectly, any and all rights and claims of subrogation, contribution, indemnification, recourse and any other rights and claims of recovery against the Sellers and their respective past, present or future direct or indirect shareholders, members, directors, officers, employees, partners, heirs, agents or Representatives (collectively, the “Seller R&W Parties”), except that the R&W Insurer may receive rights of subrogation against the Sellers in the event and to the extent that a payment under the R&W Insurance Policy arose out of Fraud by the Sellers, and then only against such Seller that committed the Fraud (and only to the extent of such Seller’s Liability); provided, that the Fraud of any Person will not be imputed to any other Person. Buyer will ensure that the R&W Insurance Policy (a) includes a provision stating that the Seller R&W Parties are express and intended third party beneficiaries of the R&W Insurance Policy, (b) will not be amended, waived or otherwise modified or revised in any way that adversely affects any of the Seller R&W Parties without prior written consent of the Sellers, and (c) does not require Buyer or any of its Affiliates to make or bring any proceeding against any Seller R&W Party in respect of any breach of a representation or warranty by Sellers in this Agreement or any Ancillary Agreement (other than in the case of Fraud by the Sellers). Within five (5) Business Days of the Closing Date, Sellers shall deliver, or shall cause to be delivered, to Buyer two (2) or more portable “thumb drives” in PC- readable format, that contain readable, working Adobe or other (i.e., Microsoft Office) portable document format files that set forth a complete and accurate set of documents made available, provided or delivered to Buyer prior to the Closing through the Data Room. Section 6.8

Representation and Warranty Insurance. Buyer may elect Function of an RWI Policy Representation and Warranty Insurance (“RWI”) is a transaction-specific risk allocation tool designed to obtain a buy- side decrease transactional liability exposure by shifting to the insurance market potential liability for seller breaches of transactional representations and warranties insurance discovered after closing. Its primary purpose is to protect the insured (either seller or buyer, as described below) under the policy against financial losses and liabilities arising from unknown or unanticipated inaccuracies in representations and warranties by the seller under, for these purposes, a PSA. When used properly and to its benefit full potential, an RWI policy is a practical alternative to commonly accepted methods of risk allocation and mitigation by accomplishing the following (by way of example): • Can streamline the negotiation process over the scope and its sole cost nature of representations and expense) in respect warranties, as well of the Transaction measures typically implemented to secure them • Provides a seller with more flexibility or willingness to make certain representations and warranties requested by a buyer • Eliminates or reduces the size or amount of deductibles or caps in indemnification provisions • Assists the parties in determining whether certain representations and warranties will be included and the specific language of those provisions • Reduces or eliminates the need for escrows or holdbacks from sale proceeds and assists the parties in “sizing” the escrow or holdback if still required • May extend the survival period of representations and warranties following closing • Backstops or substitutes for a seller’s creditworthiness or indemnification obligations and provides for easier accessibility to collection of compensation • Substitutes for or supplements a seller’s indemnification • Relieves the seller of the obligation to reserve for contingent liabilities • Preserves the relationship between the buyer and seller, which may be important, for instance, where a buyer may have to pursue claims against continuing management post- closing • Reduces the conflict that typically accompanies a discussion of the foregoing issues, thereby potentially reducing the overall cost of the transaction (depending on the “R&W Insurance Policy”RWI premium, of course) For these reasons, sellers and buyers alike are attracted to RWI. Whether RWI is appropriate or practical in any given transaction, or in real estate transactions at all, is a fact-specific determination, as further discussed below. Why is RWI so new to real estate transactions? While RWI has been available for close to two decades, it was originally designed for use in corporate transactions, particularly mergers and acquisitions (M & A) deals. Even its use in M & A deals is a relatively recent phenomenon (that is, it has become commonplace only in the last decade or so). If Buyer obtains an R&W Insurance PolicyLike many innovative measures, Xxxxx will confirm that it took some time for parties to get comfortable with the R&W Insurance Policy includes a provision stating that the insurer(s) thereunder (the “R&W Insurer”) will not receive and will irrevocably and unconditionally waiveproduct, such as policy procurement, underwriting processes, premiums, deductibles, policy periods, exclusions from coverage, claims-paying practices, and agree the like. Now that RWI has gained popularity in corporate transactions, it has grabbed the attention of the commercial real estate arena. While certain types of real estate transactions share many characteristics in common with corporate transactions, RWI does not necessarily translate easily to bring real estate transactions. As described above in the Introduction, most PSAs for the sale of a single parcel of commercial real estate do not contain the types of representations and warranties associated with ongoing liability that would require post-closing liability protection. Instead, in such transactions, the property may be sold “As-Is”, without any actionrepresentation or warranty, or pursue with a very limited set of representations and warranties. The buyer is required to discover most, if not all, of the information about the property through a comprehensive, well-planned due diligence process. Since a meaningful number of commercial real estate transactions fit this mold, they are not suitable candidates for RWI. When conveyances of real property are effectuated through more complex structures (such as, by way of example, conveyances of real estate as part of a sale of an entity or exercisesales of large property portfolios), directly however, they may contain many of the attributes of corporate transactions, with representations and warranties, escrows, holdbacks and other components typically found in corporate transactions. These types of transactions, therefore, may lend themselves to the protections and benefits offered by RWI. The RWI Policy The type of RWI policy to be obtained in any given transaction is guided in large part by the motivation of the parties. Sellers, on the one hand, generally want to reduce or indirectlyeven eliminate their exposure for a breach of representations and warranties under the PSA. Buyers, any on the other hand, desire to protect themselves from financial loss arising from a seller’s breach of representations and all rights and claims of subrogationwarranties, contributionparticularly in situations in which the buyer does not have confidence in the seller’s creditworthiness. To address these somewhat aligned, indemnificationbut distinct, recourse and any other rights and claims of recovery against the Sellers and their respective past, present or future direct or indirect shareholders, members, directors, officers, employees, partners, heirs, agents or Representatives (collectivelyinterests, the insurance industry offers two types of RWI insurance – “Seller R&W Partiesbuyer-side” and “seller- side”). While the titles may seem self-explanatory, except that the R&W Insurer may receive rights of subrogation against the Sellers in the event and distinction is important when it comes to the extent that a payment under form of policy, coverage and the R&W Insurance Policy arose out of Fraud by the Sellers, and then only against such Seller that committed the Fraud (and only to the extent of such Seller’s Liability); provided, that the Fraud of any Person will not be imputed to any other Person. Buyer will ensure that the R&W Insurance Policy (a) includes a provision stating that the Seller R&W Parties are express and intended third party beneficiaries of the R&W Insurance Policy, (b) will not be amended, waived or otherwise modified or revised in any way that adversely affects any of the Seller R&W Parties without prior written consent of the Sellers, and (c) does not require Buyer or any of its Affiliates to make or bring any proceeding against any Seller R&W Party in respect of any breach of a representation or warranty by Sellers in this Agreement or any Ancillary Agreement (other than in the case of Fraud by the Sellers). Within five (5) Business Days of the Closing Date, Sellers shall deliver, or shall cause to be delivered, to Buyer two (2) or more portable “thumb drives” in PC- readable format, that contain readable, working Adobe or other (i.e., Microsoft Office) portable document format files that set forth a complete and accurate set of documents made available, provided or delivered to Buyer prior to the Closing through the Data Room. Section 6.8claims process.

Representation and Warranty Insurance. The Buyer may elect intends to obtain bind a buy- buy-side representations representation and warranties warranty insurance policy for its the benefit (and its sole cost and expense) in respect of the Transaction Buyer Indemnified Parties, against the inaccuracies in or breach of the warranties and representations made by the Sellers (the “R&W Representation and Warranty Insurance Policy”). If Buyer obtains an R&W Insurance Policy, Xxxxx will confirm that The cost of the R&W Representation and Warranty Insurance Policy includes a provision stating that the insurer(s) thereunder (the “R&W Insurer”) will not receive including all premiums and will irrevocably and unconditionally waive, and agree not to bring any action, or pursue or exercise, directly or indirectly, any and all rights and claims of subrogation, contribution, indemnification, recourse excess lines taxes payable in connection therewith and any fees or expenses incurred by any insurance broker or underwriting insurance company in connection therewith) shall be borne by the Buyer. The Buyer shall use commercially reasonable efforts to cause any Representation and Warranty Insurance Policy to contain a waiver of subrogation clause pursuant to which the insurer expressly waives any subrogation rights or any other rights and claims of recovery against the Sellers and their respective past, present (or future direct or indirect shareholders, members, directors, officers, employees, partners, heirs, agents or Representatives any Affiliate thereof) in connection with any claim made by any Buyer Indemnified Party thereunder (collectively, the “Seller R&W Parties”), except that the R&W Insurer may receive rights of subrogation against the Sellers in the event and to the extent that a payment written statement or other admission under the R&W Insurance Policy arose out oath or guilty plea or plea of Fraud no contest by the Sellers, and then only against such Seller or a finding of fact, judgment or other ruling in any proceeding, establishes that the Sellers committed the Fraud (and only subject to the extent following proviso, below) with respect to the warranties and representations contained herein or in the Seller Closing Certificate), and the Buyer shall not, without the prior written consent of Sellers, waive of any such Seller’s Liability)subrogation clause or amend, modify or delete of any such subrogation clause in any manner that is adverse to Sellers; provided, that for purposes only of the Fraud of any Person will not be imputed to any other Person. Buyer will ensure that subrogation provisions in the R&W Representation and Warranty Insurance Policy (a) includes a provision stating including any subrogation claim against Sellers in respect of Fraud that is brought by the Seller R&W Parties are express insurers under the Representation and intended third party beneficiaries of the R&W Warranty Insurance Policy), (b) will not be amended, waived or otherwise modified or revised the phrase in the definition of “Fraud” herein that states “any way that adversely affects any person identified in the definition of the Seller R&W Parties without prior written consent ‘Knowledge of the Sellers’ or ‘Knowledge of the Buyer’, as applicable, had actual knowledge” shall be replaced with “any Seller or any Buyer, as applicable, had actual knowledge.” The coverages provided under the Representation and Warranty Insurance Policy have been made at the sole election, determination and discretion of the Buyer on its behalf and on behalf of the Buyer Indemnified Parties, at their own risk, and (c) does not require Buyer the Seller shall have no obligation or liability with respect thereto, including with respect to any adequacy of its Affiliates to make or bring any proceeding against any Seller R&W Party in respect of any breach of a representation or warranty by Sellers in this Agreement or any Ancillary Agreement (other than in the case of Fraud by the Sellers)coverage. Within five (5) Business Days of the Closing Date, Sellers shall deliver, or shall cause to be delivered, to Buyer two (2) or more portable “thumb drives” in PC- readable format, that contain readable, working Adobe or other (i.e., Microsoft Office) portable document format files that set forth a complete and accurate set of documents made available, provided or delivered to Buyer prior to the Closing through the Data Room. Section 6.820762941.9

Representation and Warranty Insurance. (a) Buyer may elect to obtain a buy- side representations and warranties insurance policy for its benefit (and its sole cost and expense) in respect of the Transaction (the “R&W Insurance Policy”). If Buyer obtains an R&W Insurance Policywill not, Xxxxx will confirm that the R&W Insurance Policy includes a provision stating that the insurer(s) thereunder (the “R&W Insurer”) will not receive and will irrevocably cause the Companies not to, enter into any agreement with any insurer specifically for the purpose of insuring against a breach by Sellers of their representations, warranties and unconditionally waivecovenants under this Agreement that enables such insurer to seek indemnity, and agree not contribution or subrogation to bring any action, or pursue or exercise, directly or indirectly, any and all rights and claims of subrogation, contribution, indemnification, recourse and any other rights and claims of recovery the extent the amount recoverable by the insurer against the Sellers and their respective past, present or future direct or indirect shareholders, members, directors, officers, employees, partners, heirs, agents or Representatives (collectively, on account of a claim exceeds the “Seller R&W Parties”), except that maximum the R&W Insurer may receive rights of subrogation Buyer would be able to recover in an action directly against the Sellers for its own interests pursuant to the terms of this Agreement. In the event that, notwithstanding the foregoing, such insurer seeks contribution, indemnity or subrogation against any of the Sellers, Buyer hereby agrees that Sellers (individually or in the event and to aggregate) shall not be liable for an amount or amounts that, individually or in the aggregate, (x) exceed or would exceed the maximum liability of the Sellers hereunder or (y) would result in a duplicate payment by any of the Sellers under the terms of this Agreement. To the extent that such insurer’s claim for contribution, indemnity or subrogation against any of the Sellers would result in liability of the Sellers or any Seller in excess of the maximum liability of the Sellers or any such Seller provided hereunder or would result in a duplicate payment under the R&W Insurance Policy arose out by any of Fraud by the Sellers, Buyer agrees to, or will cause MPC to, defend such Sellers or Seller with respect to such claim and then only against Buyer will, or will cause MPC to, indemnify and hold harmless the applicable Sellers or Seller from such Seller that committed the Fraud (claim and liability, but only to the extent of such claim exceeds the Sellers’ or applicable Seller’s Liability); provided, that the Fraud of any Person will not be imputed to any other Person. Buyer will ensure that the R&W Insurance Policy (a) includes maximum liability for such claim under this Agreement or results in a provision stating that the Seller R&W Parties are express and intended third party beneficiaries of the R&W Insurance Policy, (b) will not be amended, waived or otherwise modified or revised in any way that adversely affects duplicate payment by any of the Seller R&W Parties without prior written consent of the Sellers, and (c) does not require Buyer or any of its Affiliates to make or bring any proceeding against any Seller R&W Party in respect of any breach of a representation or warranty by Sellers in this Agreement or any Ancillary Agreement (other than in the case of Fraud by the Sellers). Within five (5) Business Days of the Closing Date, Sellers shall deliver, or shall cause to be delivered, to Buyer two (2) or more portable “thumb drives” in PC- readable format, that contain readable, working Adobe or other (i.e., Microsoft Office) portable document format files that set forth a complete and accurate set of documents made available, provided or delivered to Buyer prior pursuant to the Closing through the Data Room. Section 6.8terms of this Agreement.

Representation and Warranty Insurance. Buyer The Purchaser shall: (i) arrange for insurance to cover losses that may elect to obtain a buy- side be incurred by the Purchaser arising from the breach of the Vendorco's representations and warranties contained in this Agreement; and (ii) comply with or satisfy or cause to be satisfied all conditions for such insurance that are within its power and control to satisfy or cause to be satisfied. The insurance arranged by the Purchaser involves an insurance policy insuring Vendorco and Vendorco has (i) signed the application and will sign such other documents as may reasonably be required for the Purchaser to obtain such insurance policy (the "POLICY") and which are not inconsistent with the terms of this Agreement, (ii) assign all of its rights and benefits under the Policy to and for the benefit of the Purchaser pursuant to agreements and documents as reasonably required by the insurance company, and (iii) comply with or satisfy or cause to be satisfied all conditions for such insurance that are within its power and its sole cost control to satisfy or cause to be satisfied, provided that, upon completion of the Transactions, in no event shall the Vendor (or any of the Trustees) have any obligation or liability to any party hereto or to the insurer(s) in respect of or pursuant to the Policy including, without limitation, any direct or indirect liability to the Purchaser, IMRM or the Company (except as contemplated in Article 8 hereof) or to the insurer(s) as a result of any untruth, inaccuracy or breach of any of the representations and expensewarranties herein ("BREACH") and no obligation to make or otherwise be party to any claim in respect of any Breach or the Policy in respect thereof. The Purchaser, IMRM and the Company acknowledge and agree that they will have no claim, and will not bring or make any claim, against the Vendor (or the Trustees thereof) in respect of the Transaction (Policy or any Breach on the “R&W Insurance Policy”part of the Vendor or Vendorco in this Agreement. The Company shall pay up to $150,000 of the cost of obtaining the Policy and such amount shall be deducted from the Share Purchase Price in accordance with subsection 3.3(b)(iv). If Buyer obtains an R&W Insurance Policy, Xxxxx will confirm that the R&W Insurance Policy includes a provision stating that the insurer(s) thereunder (the “R&W Insurer”) will not receive and will irrevocably and unconditionally waive, and agree not to bring any action, or pursue or exercise, directly or indirectly, any and The Purchaser shall pay for all rights and claims such costs in excess of subrogation, contribution, indemnification, recourse and any other rights and claims of recovery against the Sellers and their respective past, present or future direct or indirect shareholders, members, directors, officers, employees, partners, heirs, agents or Representatives (collectively, the “Seller R&W Parties”), except that the R&W Insurer may receive rights of subrogation against the Sellers in the event and to the extent that a payment under the R&W Insurance Policy arose out of Fraud by the Sellers, and then only against such Seller that committed the Fraud (and only to the extent of such Seller’s Liability); provided, that the Fraud of any Person will not be imputed to any other Person. Buyer will ensure that the R&W Insurance Policy (a) includes a provision stating that the Seller R&W Parties are express and intended third party beneficiaries of the R&W Insurance Policy, (b) will not be amended, waived or otherwise modified or revised in any way that adversely affects any of the Seller R&W Parties without prior written consent of the Sellers, and (c) does not require Buyer or any of its Affiliates to make or bring any proceeding against any Seller R&W Party in respect of any breach of a representation or warranty by Sellers in this Agreement or any Ancillary Agreement (other than in the case of Fraud by the Sellers). Within five (5) Business Days of the Closing Date, Sellers shall deliver, or shall cause to be delivered, to Buyer two (2) or more portable “thumb drives” in PC- readable format, that contain readable, working Adobe or other (i.e., Microsoft Office) portable document format files that set forth a complete and accurate set of documents made available, provided or delivered to Buyer prior to the Closing through the Data Room. Section 6.8$150,000.