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EXHIBIT
10.6
FIRST AMENDMENT TO AMENDED AND RESTATED TAX
INDEMNITY AGREEMENT
THIS FIRST AMENDMENT TO AMENDED AND RESTATED TAX
INDEMNITY AGREEMENT (the "Agreement") is made and entered into this
21st day of November, 2006 by and among PRIME GROUP REALTY,
L.P. , a Delaware limited partnership ("Prime"), RICHARD
A. HEISE ("Heise"), CTA GENERAL PARTNER, LLC ,
a Delaware limited liability company ("General Partner"), and
CONTINENTAL TOWERS, L.L.C. , a Delaware limited liability
company ("Newco").
WHEREAS , Prime, Heise,
General Partner and Newco entered into that certain Amended and
Restated Tax Indemnity Agreement dated as of January 10, 2006
("TIA");
WHEREAS , Heise and General Partner are
the only partners in Continental Towers Associates-I, L.P., an
Illinois limited partnership ("CTA") and General Partner is the
sole general partner of CTA;
WHEREAS , CTA is the only member of
Continental Towers Associates II, LLC, a Delaware limited liability
company ("CTAII");
WHEREAS , CTAII is the sole member of
Continental Towers Associates III, LLC, a Delaware limited
liability company ("CTAIII");
WHEREAS, concurrently with the execution
and delivery of this First Amendment, (a) CTA, the owner of an
undivided 36% interest in the Real Estate (as defined in the TIA),
will transfer all of its right, title and interest in and to the
Real Estate to CTAIII; (b) Heise and General Partner will enter
into a Dissolution pursuant to which (i) Heise will redeem his
96.7429% partnership interests in CTA in exchange for a 96.7429%
membership interest in CTAII, and (ii) General Partner will redeem
its 3.2571% partnership interest in CTA in exchange for a 3.2571%
interest in CTAII; and (iii) CTA will be dissolved; (c) CTAIII, as
successor in interest to CTA, and Newco, the owner of an undivided
64% interest in the Real Estate, will enter into a First Amendment
of the Co-Ownership Agreement (as defined in the TIA); (d) CTAIII
and Newco will refinance the Senior Loan with CWCapital LLC;
and
WHEREAS , the parties desire to amend the
TIA to reflect the new ownership structure for the Real Estate, the
new Senior Loan, and to make certain other changed to which the
parties have agreed;
NOW, THEREFORE , in consideration of the
matters set forth in the recitals and the mutual covenants set
forth hereafter, the parties agree as follows:
1.
The definitions of " Senior Lender ", "
Senior Loan ", " Senior Loan Documents " and "
Senior Loan Agreement " in Section 1 of the TIA are
hereby deleted in their entirety and the following inserted in lieu
thereof:
" Senior Lender " shall have the meaning
set forth in Section 2c .
" Senior Loan " shall have the meaning
set forth in Section 2c .
" Senior Loan Agreement " shall have the
meaning set forth in Section 2c .
" Senior Loan Documents " shall have the
meaning set forth in Section 2c .
2.
The definition of "Indemnification Event" in Section
1 of the TIA is hereby amended by inserting ", CTAII, CTAIII" after
each reference to "CTA" in said definition.
3.
The definition of "Tax Event" in Section 1 of the
TIA is hereby amended by deleting the reference to "CTA" and
inserting "CTAII" in lieu thereof.
4.
The following subsection c is hereby inserted into
Section 2 of the TIA as if fully set forth
therein:
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"c.
New 2006 Transaction . Prime, Heise, and
certain Affiliates of the foregoing are entering into the following
agreements (items (i), (ii), (iii) and (iv) below are collectively
referred to as the " New 2006 Transaction "):
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(i)
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CTA will form CTAII will cause
CTAII to form CTAIII.
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(ii)
Heise and General Partner will cause CTA to transfer
and assign by Special Warranty Deed all of its right, title and
interest in and to the Real Estate (being an undivided 36% interest
as a tenant in common with Newco) to CTAIII, subject to the Junior
Loan and the Senior Loan.
(iii)
Heise and General Partner will enter into that certain
Dissolution Agreement dated as of the date hereof pursuant to which
CTA will be dissolved and will distribute a 96.7429% membership
interest in CTAIII to Heise and a 3.2571% membership interest in
CTAII to CTA Genera
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