Common use of Permitted Ownership Clause in Contracts

Permitted Ownership. (a) Within three business days after the date hereof, the Company shall amend the Company's Shareholder Rights Agreement, dated as of June 19, 1999 between the Company and First Chicago Trust Company of New York, as Rights Agent (the "Rights Agreement"), or take such other action with respect thereto, such amendment or other action to be in form and substance reasonably acceptable to the SA Group and its legal counsel, in order to permit the SA Group to beneficially own, in the aggregate, up to (and including) 19.9% of the outstanding Common Stock (the "Permitted Ownership"), which may include, without limitation, shares convertible into Common Stock, without triggering any adverse consequences to any member of the SA Group under the provisions of the Rights Agreement. (b) Within three business days after the date hereof, the Company shall take such action as is necessary to exempt the Permitted Ownership from the provisions of Article VII, Section 7.2 of the Company's Articles of Amendment and Restatement (the "Charter"), and the SA Group shall cooperate with the Company and take such action as may be reasonably requested by the Company so that the requirements thereof shall be complied with; provided, however, that purchases of shares of Common Stock by the SA Group may be prohibited if such purchases would result in the Company becoming "closely held" within the meaning of Section 856(h) of the Internal Revenue Code of 1986, as amended (the "Code"), or otherwise would cause the Company to fail to qualify as a Real Estate Investment Trust under the Code and the rules relating thereto. (c) Each member of the SA Group agrees to support and vote (or cause to be voted) all of his, her or its shares of stock of the Company (including, without limitation, the Shares) in favor of (i) the Board's plan of liquidation, (ii) the election of all directors nominated by the Board for election at any and all annual or special meetings of shareholders and (iii) the adoption of such amendments to the Rights Agreement and the Charter or the taking of such other action with respect thereto as the Independent Directors may determine to be necessary or appropriate to permit any other shareholder to acquire the levels of Permitted Ownership that the SA Group is permitted to acquire. (d) The Company represents and warrants to the SA Group that, (i) except for any actions to be taken by the Company pursuant to this Section 3, no acts are required to be taken by the Company in order to cause the Permitted Ownership to be exempt from any restriction or limitation under the Rights Agreement, the Charter, the Company's by-laws or any other agreement or instrument to which the Company is a party or by which it is bound and (ii) the execution, delivery and performance of this Agreement by the Company will not: (A) violate any constitution, statute, regulation, rule, injunction, judgment, order, decree, ruling, charge or other restriction of any governmental authority or court to which the Company is subject or any provision of the Charter or by-laws of the Company; or (B) conflict with, result in a breach of, constitute a default under, result in the acceleration of, create in any party the right to accelerate, terminate, modify, or cancel, result in the creation of any encumbrance upon or require any notice under any agreement to which the Company is a party or by which it is bound. (e) The Company hereby confirms and acknowledges that the Company has adopted appropriate resolutions to exempt itself from the provisions of Section 3-602 of the Maryland General Corporation Law with respect to the acquisition by any person of the capital stock of the Company, and the Company further confirms and acknowledges that such resolutions exempt the Permitted Ownership from such provisions. (f) The Company has furnished to the SA Group a true, correct and complete copy of its by-laws as amended to date. (g) Each member of the SA Group severally represents and warrants to the Company that the execution, delivery and performance of this Agreement by the members of the SA Group will not: (A) violate any constitution, statute, regulation, rule, injunction, judgment, order, decree, ruling, charge or other restriction of any governmental authority or court to which such member is subject or, if such member is not a natural person, any provision of such member's organizational documents; or (B) conflict with, result in a breach of, constitute a default under, result in the acceleration of, create in any party the right to accelerate, terminate, modify, or cancel, result in the creation of any encumbrance upon or require any notice under any agreement to which such member is a party or by which it is bound.