CONTRIBUTION AGREEMENT by and among ARCADE RENTAL INVESTMENTS, INC., PARAMOUNT GROUP, INC., and THE STOCKHOLDER of ARCADE RENTAL INVESTMENTS, INC. Dated as of November 6, 2014

Exhibit 10.14

CONTRIBUTION AGREEMENT

by and among

ARCADE RENTAL INVESTMENTS, INC.,

PARAMOUNT GROUP, INC.,

and

THE STOCKHOLDER

ARCADE RENTAL INVESTMENTS, INC.

Dated as of November 6, 2014

TABLE OF CONTENTS


		Page

ARTICLE I CONTRIBUTION; CONVERSION; MERGER			2

Section 1.01	Contribution Transaction; Assignment and Assumption		2
Section 1.02	Consideration		3
Section 1.03	Further Action		3
Section 1.04	Transaction Costs		3
Section 1.05	Prorations		3
Section 1.06	Tax Treatment of Contribution, Conversion and Merger		3

ARTICLE II CLOSING			4

Section 2.01	Conditions Precedent		4
Section 2.02	Time and Place		6
Section 2.03	Closing Deliveries		6
Section 2.04	Transfer Costs		7
Section 2.05	Term of the Agreement		7
Section 2.06	Effect of Termination		7
Section 2.07	Tax Withholding		7
Section 2.08	Merger		8

ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE COMPANY			8

Section 3.01	Organization; Authority		8
Section 3.02	Due Authorization		8
Section 3.03	Consents and Approvals		9
Section 3.04	Tax Matters		9
Section 3.05	No Violation		9
Section 3.06	Validity of Company Shares		9
Section 3.07	Litigation		9
Section 3.08	Limited Activities		9
Section 3.09	Broker		10
Section 3.10	No Other Representations or Warranties		10

ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE CONTRIBUTOR			10

Section 4.01	Organization; Authority		10
Section 4.02	Due Authorization		11
Section 4.03	Ownership of Contributed Interests; Capitalization		11
Section 4.04	Consents and Approvals		12
Section 4.05	Taxes		12
Section 4.06	No Violation		13
Section 4.07	Solvency		13
Section 4.08	Litigation		14
Section 4.09	Licenses and Permits		14
Section 4.10	Properties		14
Section 4.11	Insurance		16
Section 4.12	Environmental Matters		16


Section 4.13	Investment	16
Section 4.14	Broker	17
Section 4.15	Eminent Domain	17
Section 4.16	Assets and Liabilities	17
Section 4.17	No Other Representations or Warranties	17

ARTICLE V INDEMNIFICATION		17

Section 5.01	Company Indemnification	17
Section 5.02	Stockholder Indemnification	18
Section 5.03	Notice of Claims	18
Section 5.04	Third Party Claims	19
Section 5.05	Survival of Representations and Warranties	19
Section 5.06	Establishment of Indemnity Holdback Escrow	20
Section 5.07	Exclusive Remedy	20
Section 5.08	Tax Treatment	20

ARTICLE VI COVENANTS AND OTHER AGREEMENTS		20

Section 6.01	Covenants of the Contributor	20
Section 6.02	Stockholder’s Representative	21
Section 6.03	Tax Covenants	21
Section 6.04	Tax Protection Provisions	22
Section 6.05	Liability for Transfer Taxes	23
Section 6.06	Commercially Reasonable Efforts By the Company and the Contributor	24

ARTICLE VII GENERAL PROVISIONS		24

Section 7.01	Notices	24
Section 7.02	Definitions	25
Section 7.03	Counterparts	27
Section 7.04	Entire Agreement; Third-Party Beneficiaries	27
Section 7.05	Governing Law	27
Section 7.06	Assignment	27
Section 7.07	Jurisdiction	28
Section 7.08	Dispute Resolution	28
Section 7.09	Severability	29
Section 7.10	Rules of Construction	29
Section 7.11	Equitable Remedies	30
Section 7.12	Time of the Essence	30
Section 7.13	Descriptive Headings	30
Section 7.14	No Personal Liability Conferred	30
Section 7.15	Amendments	30

EXHIBITS


Exhibit A		List of Properties
Exhibit B		Certificate of Conversion
Exhibit C		Certificate of Formation
Exhibit D		Agreement and Plan of Merger
Exhibit E		Escrow Agreement
Exhibit F		Lock-up Agreement
Exhibit G		Assignment and Assumption Agreement

SCHEDULES


Schedule 1.01		Excluded Assets
Schedule 1.02		Consideration

iii

DEFINED TERMS


Affiliate		Section 7.02
Arcade		Introduction
Arcade LLC		Introduction
Assignment and Assumption Agreement		Section 1.01
Business Day		Section 7.02
Certificate of Conversion		Recitals
Certificate of Formation		Recitals
Claim		Section 5.03
Claim Notice		Section 5.03
Closing Documents		Section 2.03
Code		Section 7.02
Company		Introduction
Company Cap		Section 5.07
Company Common Stock		Recitals
Company Indemnified Party		Section 5.02
Company’s Knowledge		Section 7.02
Company Material Adverse Effect		Section 7.02
Company Shares		Recitals
Contributed Interests		Recitals
Contribution		Recitals
Contribution Agreement		Introduction
Contribution Closing		Section 2.02
Contribution Closing Date		Section 2.02
Contributor		Introduction
Contributor Disclosure Letter		Article IV
Contributor Indemnified Party		Section 5.01
Contributor Material Adverse Effect		Section 7.02
Contributor Subsidiary		Section 4.01
Contributor’s Knowledge		Section 7.02
Conversion		Recitals
Covenant Period		Section 6.04
Deductible		Section 5.02
Dispute		Section 7.08
DSOS		Recitals
Environmental Laws		Section 7.02
Equity Holder		Recitals
Escrow Agreement		Recitals
Excluded Assets		Section 1.01
Expiration Date		Section 5.05
Formation Transactions		Recitals
Governmental Authority		Section 7.02
Incremental Transfer Taxes		Section 7.02
Indemnified Party		Section 5.03
Indemnifying Party		Section 5.03


Indemnity Holdback Amount		Recitals
IPO		Recitals
IPO Closing		Section 2.02
IPO Closing Date		Section 7.02
JV Entities		Section 4.01
Laws		Section 7.02
Leases		Section 4.10
Liens		Section 7.02
Lock-up Agreement		Recitals
Losses		Section 5.01
Merger		Recitals
Merger Agreement		Recitals
New York Transfer Taxes		Section 6.03
No Gain Covenant		Section 6.04
No-Tax Position		Section 6.04
Operating Partnership		Recitals
Organizational Documents		Section 7.02
Outside Date		Section 2.05
Permitted Activities		Section 4.16
Permitted Distribution		Section 4.16
Permitted Liens		Section 7.02
Person		Section 7.02
Price to the Public		Section 7.02
Prohibited Event		Section 6.04
Properties		Recitals
Property		Recitals
Property Interests		Recitals
Registration Rights Agreement		Recitals
Registration Statement		Section 7.02
REIT		Recitals
SEC		Section 2.01
Securities Act		Section 7.02
Stockholder’s Representative		Section 6.02
Subsidiary		Section 7.02
Surviving Entity		Recitals
Tax		Section 7.02
Tax Return		Section 7.02
Third Party Claims		Section 5.04
Transaction Agreements		Recitals

CONTRIBUTION AGREEMENT

THIS CONTRIBUTION AGREEMENT (including all exhibits and schedules, this “Contribution Agreement”) is made and entered into as of November 6, 2014, by and between PARAMOUNT GROUP, INC., a Maryland corporation (the “Company”), ARCADE RENTAL INVESTMENTS, INC., a Delaware corporation (the “Contributor” or “Arcade”), and the stockholder whose name appears on the signature page hereto (the “Stockholder”). Unless otherwise specifically stated herein or the context otherwise requires, the terms “Contributor” and “Arcade” refer to Arcade and its Subsidiaries with respect to the period prior to the Conversion and to Arcade Rental Investments LLC, a Delaware limited liability company (“Arcade LLC”), and its Subsidiaries with respect to the period from and after the Conversion. After the Conversion, all references to the term “Stockholder” shall mean the “Equity Holder.” Capitalized terms used and not defined in the body of this Contribution Agreement shall have the meanings set forth in Section 7.02 hereto.

RECITALS

WHEREAS, the Company intends to conduct an initial public offering (the “IPO”) of the common stock, par value $0.01 per share (“Company Common Stock”), of the Company, which will operate as a self-administered and self-managed real estate investment trust (“REIT”) within the meaning of Sections 856 through 860 of the Code;

WHEREAS, in connection with the IPO, the Company, which is the sole general partner of Paramount Group Operating Partnership LP (the “Operating Partnership”), desires to engage in a series of transactions through which the Company and the Operating Partnership will acquire their initial portfolio of properties and other assets that they intend to own following the IPO (collectively, the “Formation Transactions”);

WHEREAS, the Contributor owns, directly or indirectly, interests (the “Property Interests”) in the properties set forth on Exhibit A hereto, under the heading “Arcade” (each, a “Property” and together the “Properties”);

WHEREAS, as part of the Formation Transactions, pursuant to this Contribution Agreement, the Contributor shall contribute (the “Contribution”) to the Company all of its assets (other than Excluded Assets) and liabilities (the “Contributed Interests”) and the Company shall acquire from the Contributor all of the Contributor’s right, title and interest in the Contributed Interests in exchange for shares of Company Common Stock;

WHEREAS, the board of directors of the Contributor and the Stockholder have approved, subject to, and following the Contribution Closing, the conversion of the Contributor from a Delaware corporation to a Delaware limited liability company (the “Conversion”);

WHEREAS, following the Contribution Closing, the Company on behalf of the Contributor will file a Certificate of Conversion with the Secretary of State of the State of Delaware (the “DSOS”), a copy of which is attached hereto as Exhibit B (the “Certificate of Conversion”), and a Certificate of Formation, a copy of which is attached hereto as Exhibit C (the “Certificate of Formation”), in order to effectuate the Conversion;

WHEREAS, following the effective time of the Conversion, pursuant to the Agreement and Plan of Merger attached hereto as Exhibit D (the “Merger Agreement” and together with this Contribution Agreement, the “Transaction Agreements”), Arcade LLC will merge with and into the Company (the “Merger”) with the Company as the surviving entity (sometimes referred to as the “Surviving Entity”) and in consideration thereof the Stockholder, which will be the sole equity holder of Arcade LLC (in such capacity, the “Equity Holder”), will receive shares of Company Common Stock (the “Company Shares”) in accordance with the terms and conditions set forth in the Merger Agreement;

WHEREAS, at the Merger Closing, the Stockholder acknowledges that the Company will deposit the number of Company Shares set forth on Schedule 1.07 of the Merger Agreement under the heading “Arcade LLC” as the Indemnity Holdback Amount, which represents approximately 1.5% of the Merger Consideration (collectively, the “Indemnity Holdback Amount”), into an Indemnity Holdback Escrow (as defined in the Escrow Agreement) pursuant to that certain Omnibus Distribution and Escrow Agent Agreement, a copy of which is attached hereto as Exhibit E (the “Escrow Agreement”), in order to provide for the exclusive remedy against the Stockholder (in its capacity as such) for any breaches of the Transaction Agreements by the Stockholder;

WHEREAS, concurrently with the execution of this Contribution Agreement, the Stockholder has executed and delivered a lock-up agreement to the underwriters of the IPO, a copy of which is attached as Exhibit F hereto (the “Lock-up Agreement”);

WHEREAS, concurrently with the execution of this Contribution Agreement, the Company has entered into a registration rights agreement with the Stockholder (the “Registration Rights Agreement”); and

WHEREAS, prior to or concurrently with the execution of this Contribution Agreement, the Company or the Operating Partnership, as the case may be, together with the applicable counterparties have entered into the Formation Transaction Documentation.

NOW, THEREFORE, in consideration of the foregoing and the representations, warranties, covenants and other terms contained in this Contribution Agreement, the receipt and sufficiency of which is hereby acknowledged and agreed, the parties hereto, intending to be legally bound hereby, agree as follows:

ARTICLE I

CONTRIBUTION; CONVERSION; MERGER

Section 1.01 Contribution Transaction; Assignment and Assumption.

(a) At the Closing and subject to the terms and conditions contained in this Contribution Agreement, the Contributor shall contribute, assign, set over, deliver and transfer to the Company absolutely and unconditionally and free and clear of all Liens (other than Permitted Liens), all of its right, title and interest in and to the Contributed Interests, including all rights to indemnification in favor of the Contributor under the agreements pursuant to which the Contributor acquired the Contributed Interests transferred pursuant to this Contribution

Agreement. The contribution of the Contributed Interests shall be evidenced by the execution and delivery of an Assignment and Assumption Agreement in substantially the form of Exhibit G attached hereto and incorporated herein by reference (the “Assignment and Assumption Agreement”).

(b) Notwithstanding anything in Section 1.01(a) to the contrary, the Contributor shall not contribute, assign, set over, deliver or transfer any of Contributor’s right, title and interest to any assets of the Contributor set forth in Schedule 1.01 under the heading “Arcade” (“Excluded Assets”).

Section 1.02 Consideration. At the Contribution Closing, subject to the terms and conditions in this Contribution Agreement, in exchange for the transfer of the Contributed Interests, the Company shall issue to the Contributor the number of Company Shares set forth on Schedule 1.02 under the heading “Arcade”. No fractional Company Shares shall be issued to the Contributor pursuant to this Agreement. If aggregating all Company Shares that the Contributor otherwise would be entitled to receive pursuant to this Agreement would require the issuance of a fractional Company Share, the Contributor shall instead be entitled to receive one full Company Share in lieu of such fractional Company Share.

Section 1.03 Further Action. If, at any time after the Contribution Closing, the Company shall determine or be advised that any deeds, bills of sale, assignments, assurances or any other actions or things are necessary or desirable to vest, perfect or confirm of record or otherwise in the Surviving Entity the right, title or interest in, to or under any of the rights, properties or assets of the Contributor acquired or to be acquired by the Company as a result of, or in connection with, the Contribution or otherwise to carry out this Contribution Agreement, the Company shall be authorized to execute and deliver, in the name and on behalf of the Contributor, all such deeds, bills of sale, assignments and assurances and to take and do, in the name and on behalf of the Contributor, all such other actions and things as may be necessary or desirable to vest, perfect or confirm any and all right, title and interest in, to and under such rights, properties or assets in the Company or otherwise to carry out this Contribution Agreement.

Section 1.04 Transaction Costs. Subject to Section 6.05, if the Contribution Closing occurs, the Company shall be solely responsible for all transaction costs and expenses of the Company and the Contributor that have not previously been paid in connection with this Contribution Agreement, which include, but are not limited to, lender consent fees, legal, accounting and consultant fees.

Section 1.05 Prorations. There shall be no prorations at the Contribution Closing for any income and expense items with respect to the Properties.

Section 1.06 Tax Treatment of Contribution, Conversion and Merger. It is intended that, for U.S. federal income tax purposes, that the Contribution, Conversion and Merger shall, taken together, qualify as a “reorganization” within the meaning of Section 368(a) of the Code, and that this Contribution Agreement and the Merger Agreement constitutes, and hereby is adopted as, a “plan of reorganization” within the meaning of Treasury Regulations Sections 1.368-2(g) and 1.368-3.

ARTICLE II

CLOSING

Section 2.01 Conditions Precedent.

(a) Condition to Each Party’s Obligations. The respective obligation of each party to effect the contribution contemplated by this Contribution Agreement and to consummate the other transactions contemplated hereby to occur on the Contribution Closing Date is subject to the satisfaction or waiver on or prior to the Closing of the following conditions:

(i) Registration Statement. The Registration Statement shall have become effective under the Securities Act and shall not be the subject of any stop order or proceedings by the Securities and Exchange Commission (“SEC”) seeking a stop order. This condition may not be waived by any party.

(ii) IPO Proceeds. The Company shall have received, or have the right to receive, substantially concurrently with the Contribution Closing and the Merger Closing, the proceeds from the IPO. This condition may not be waived by any party.

(iii) Merger. The Company, the Contributor and the Stockholder will agree that, except for filings with the DSOS in order to effectuate the Conversion, any conditions to closing the Merger, other than effecting the Conversion, have been irrevocably satisfied or waived at or prior to the Contribution Closing. This condition may not be waived by any party.

(iv) No Injunction. No Governmental Authority shall have enacted, issued, promulgated, enforced or entered any statute, rule, regulation, executive order, decree, judgment, injunction or other order (whether temporary, preliminary or permanent), in any case which is in effect and which prevents or prohibits consummation of any of the transactions contemplated by the Transaction Agreements nor shall any of the same brought by a Governmental Authority of competent jurisdiction be pending that seeks the foregoing.

(b) Conditions to Obligations of the Company. The obligation of the Company to effect the Contribution contemplated by this Agreement and to consummate the other transactions contemplated hereby to occur on the Contribution Closing Date are further subject to satisfaction of the following conditions (any of which may be waived by the Company in whole or in part):

(i) Representations and Warranties. (i) The representations and warranties of the Contributor set forth in Section 4.16 shall be true and correct in all respects as of the date of this Contribution Agreement and as of the Contribution Closing, (ii) each representation and warranty of the Contributor contained in this Contribution Agreement (other than in Section 4.16) that is qualified by materiality or Contributor Material Adverse Effect shall be true and correct in all respects as of the date of this Contribution Agreement and as of the Contribution Closing as if made again at that time (except to the extent that any representation or warranty speaks as of an earlier date, in

which case it must be true and correct only as of that earlier date), and (iii) each representation and warranty of the Contributor contained in this Contribution Agreement (other than in Section 4.16) that is not qualified by materiality or Contributor Material Adverse Effect shall be true and correct as of the date of this Contribution Agreement and as of the Contribution Closing as if made again at that time (except to the extent that any representation or warranty speaks as of an earlier date, in which case it must be true and correct only as of that earlier date), except where the failure of such representations and warranties to be true and correct would not reasonably be expected to have a Contributor Material Adverse Effect.

(ii) Performance by the Contributor. The Contributor shall have performed in all material respects all agreements and covenants required by the Transaction Agreements to be performed or complied with by it on or prior to the Contribution Closing Date.

(iii) Consents, Etc. All necessary consents and approvals of Governmental Authorities or third parties (including lenders) for the Contributor and the Stockholder to consummate the transactions contemplated by the Transaction Agreements (except for those the absence of which would not have a material adverse effect on the ability of the Contributor to consummate the transactions contemplated by the Transaction Agreements) shall have been obtained.

(iv) FIRPTA Affidavit. The Contributor shall have provided the Company with a properly executed FIRPTA certificate substantially in the form set forth in Treasury Regulation Section 1.1445-2(b)(2) providing that the Contributor is not a “foreign person” and the Stockholder shall have (A) provided the Company with a properly executed FIRPTA certificate in accordance substantially with the form set forth in Treasury Regulation Section 1.1445-2(d)(2) sufficient to avoid any withholding under Section 1445 of the Code or (B) provided cash (in such amount as determined by the Company in its reasonable discretion) to the Company sufficient to pay any applicable withholding under the Code.

(v) Closing Documents. The Contributor shall have executed and delivered to the Company the documents to which it is a party which are required to be delivered pursuant to Section 2.03.

(c) Conditions to Obligations of the Contributor. The obligation of the Contributor to effect the Contribution contemplated by this Contribution Agreement and to consummate the other transactions contemplated hereby to occur on the Contribution Closing Date are further subject to satisfaction of the following conditions (any of which may be waived by the Contributor in whole or in part):

(i) Representations and Warranties. (i) Each representation and warranty of the Company contained in this Contribution Agreement that is qualified by materiality or Company Material Adverse Effect shall be true and correct in all respects as of the date of this Contribution Agreement, as of the Contribution Closing as if made again at that time (except to the extent that any representation or warranty speaks as of an

earlier date, in which case it must be true and correct only as of that earlier date), and (ii) each representation and warranty of the Company contained in this Contribution Agreement that is not qualified by materiality or Company Material Adverse Effect shall be true and correct as of the date of this Contribution Agreement, as of the Contribution Closing as if made again at that time (except to the extent that any representation or warranty speaks as of an earlier date, in which case it must be true and correct only as of that earlier date), except where the failure of such representations and warranties to be true and correct would not reasonably be expected to have a Company Material Adverse Effect.

(ii) Performance by the Company. The Company shall have performed in all material respects all agreements and covenants required by the Transaction Agreements to be performed or complied with by it on or prior to the Contribution Closing Date.

(iii) Consents, Etc. All necessary consents and approvals of Governmental Authorities or third parties (including lenders) for the Company to consummate the transactions contemplated by the Transaction Agreements (except for those the absence of which would not have a material adverse effect on the ability of any of the Company to consummate the transactions contemplated by the Transaction Agreements) shall have been obtained.

(iv) Price to the Public. The Contributor shall have approved the Price to the Public.

(v) Closing Documents. The Company shall have executed and delivered to the Contributor the documents required to be delivered pursuant to Section 2.03.

Section 2.02 Time and Place. Unless this Contribution Agreement shall have been terminated pursuant to Section 2.05, and subject to satisfaction or waiver of the conditions in Section 2.01, the closing of the transfer contemplated by Section 1.01 and the other transactions contemplated hereby (the “Contribution Closing” or the “Contribution Closing Date”) shall occur prior to the Conversion and the Conversion shall occur prior to the Merger Closing and concurrently with the closing of the IPO (the “IPO Closing”), or up to one (1) day prior to, but conditioned upon the subsequent occurrence of the Merger Closing and the IPO Closing. The Closing shall take place at the offices of ▇▇▇▇▇▇▇ Procter LLP, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ or such other place as determined by the Company in its sole discretion. In connection with the foregoing, the parties hereto hereby agree that the specific order in which the Contribution Closing, the Merger Closing, the IPO Closing and the closing of the other transactions that are part of or related to the Formation Transactions occur shall be as determined by the Company, provided, however, that the Contribution Closing shall precede the Conversion, and the Conversion shall precede the Merger Closing.

Section 2.03 Closing Deliveries. On the Contribution Closing Date, each of the parties shall make, execute, acknowledge and deliver the legal documents and other items to which it is a party or for which it is otherwise responsible that are necessary to carry out the intention of this

Contribution Agreement and the other transactions contemplated to take place in connection therewith (collectively, the “Closing Documents”). The Closing Documents and other items to be delivered at the Contribution Closing shall be the following:

(a) the Assignment and Assumption Agreement; and

(b) an executed Certificate of Conversion and Certificate of Formation.

Section 2.04 Transfer Costs. Subject to Section 6.05, the Company shall pay any documentary transfer taxes, escrow charges, title charges and recording taxes or fees incurred by the Company or the Contributor in connection with the transactions contemplated hereby.

Section 2.05 Term of the Agreement. The Transaction Agreements shall terminate automatically if the transactions contemplated by the Transaction Agreements shall not have been consummated on or prior to March 31, 2015 (such date is hereinafter referred to as the “Outside Date”). In addition, the Transaction Agreements may be terminated before the Contribution Closing by a document signed by the Company and the Contributor.

Section 2.06 Effect of Termination. In the event of termination of the Transaction Agreements for any reason, all obligations on the part of the Company and the Contributor and the Stockholder under the Transaction Agreements shall terminate, except that the obligations set forth in Article VII shall survive, it being understood and agreed, however, for the avoidance of doubt, that if the Transaction Agreements are terminated because one or more of the conditions to the non-breaching party’s obligations under this Contribution Agreement are not satisfied by the Outside Date as a result of the other party’s material breach of a covenant, representation, warranty or other obligation under the Transaction Agreements, the non-breaching party’s right to pursue all legal remedies with respect to such breach will survive such termination unimpaired.

Section 2.07 Tax Withholding. The Company shall be entitled to deduct and withhold, or cause to be deducted and withheld, from the consideration payable (or deemed payable) as a result of the transactions contemplated by the Transaction Agreements, including the Indemnity Holdback Amount, to the Contributor, or the Stockholder, as applicable, such amounts as the Company is required to deduct and withhold with respect to the making of such payment under the Code or any provision of state, local or non-U.S. tax law (as determined by the Company in its reasonable discretion). To the extent that amounts are so deducted and withheld by the Company, such amounts shall be treated for all purposes of the Transaction Agreements as having been paid to the Contributor, or the Stockholder, as applicable. The Contributor or the Stockholder, as applicable, shall (A) to the extent requested by Arcade, contribute cash prior to the Contribution and Merger equal to (i) any withholding Taxes that would otherwise be required to be withheld by the Company in connection with the Contribution and Merger (taking into account any gross-up attributable to such amounts) and (ii) any withholding Taxes that Arcade failed to withhold with respect to distributions to the Stockholder prior to the Closing and (B) indemnify and hold harmless the Company for any withholding Taxes relating to the Company’s failure to withhold from the Contributor or the Stockholder, as applicable, as required by applicable Laws, and for any Taxes of the Contributor (including those described in subclause (A)(ii) above), other than the Taxes attributable to the Company’s breach of its covenants in

Section 6.03(f) or Section 6.04, provided, however, that, in either case, neither the Contributor nor the Stockholder, as applicable, shall be liable for any penalties that may become payable in respect thereof, and provided further that, for the avoidance of doubt, the indemnification obligation of the Stockholder pursuant to this clause (B) shall neither be limited to the Indemnity Holdback Amount nor subject to the Deductible.

Section 2.08 Merger.

(a) Immediately following the Contribution Closing, the Contributor and the Stockholder agree that the Company shall take all actions to file, or cause to be filed, the Certificate of Conversion and the Certificate of Formation, at the Contributor’s sole cost and expense, with the DSOS. The parties agree and acknowledge that the closing of the Merger is conditioned upon the closing of the Contribution and the effectiveness of the Conversion.

(b) Immediately following the completion of the Conversion, the Company, Arcade LLC, and the Equity Holder shall execute and deliver the Merger Agreement and close the Merger in accordance with the terms and conditions of the Merger Agreement.

ARTICLE III

REPRESENTATIONS AND WARRANTIES

OF THE COMPANY

The Company hereby represents and warrants to the Contributor as set forth below, which representations are true and correct as of the date hereof (or such other date specifically set forth below) and as of the Contribution Closing as if made again at that time (except to the extent that any representation or warranty only speaks as of an earlier date, in which case it is true and correct as of the earlier date):

Section 3.01 Organization; Authority. The Company is a corporation duly incorporated, validly existing and in good standing under the Laws of the State of Maryland. The Company has all requisite power and authority to enter into the Transaction Agreements and all agreements contemplated thereby to which it is party and to carry out the transactions contemplated by the Transaction Agreements, and to own, lease or operate its property and to carry on its business as presently conducted and, to the extent required under applicable Laws, is qualified to do business and is in good standing in each jurisdiction in which the nature of its business or the character of its property make such qualification necessary, other than in such jurisdictions where the failure to be so qualified would not reasonably be expected to have a Company Material Adverse Effect.

Section 3.02 Due Authorization. The execution, delivery and performance of the Transaction Agreements by the Company have been duly and validly authorized by all necessary action of the Company. The Transaction Agreements and each agreement, document and instrument executed and delivered by or on behalf of the Company pursuant to the Transaction Agreements constitutes, or when executed and delivered will constitute, the legal, valid and binding obligation of the Company, each enforceable against the Company in accordance with its terms, subject to applicable bankruptcy, insolvency, moratorium or other similar Laws relating to creditors’ rights and general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).

Section 3.03 Consents and Approvals. Except in connection with the IPO and the consummation of the Formation Transactions or as shall have been obtained on or prior to the Contribution Closing Date, no consent, waiver, approval or authorization of, or filing with, any Person or Governmental Authority or under any applicable Laws is required to be obtained by the Company in connection with the execution, delivery and performance of the Transaction Agreements and the transactions contemplated thereby, including, without limitation, the Merger, except for those consents, waivers, approvals, authorizations or filings, the failure of which to obtain or to file would not reasonably be expected to have a Company Material Adverse Effect.

Section 3.04 Tax Matters. At the effective time of the IPO and at the Contribution Closing and at the effective time of the Merger, the Company shall be organized in a manner so as to qualify for taxation as a REIT pursuant to Sections 856 through 860 of the Code. The Company intends to elect to be taxed and to operate in a manner that will allow it to qualify as a REIT for U.S. federal income tax purposes commencing with its taxable year ending December 31 of the year in which the Contribution Closing takes place.

Section 3.05 No Violation. None of the execution, delivery or performance of the Transaction Agreements, any agreement contemplated by the Transaction Agreements between the parties to the Transaction Agreements and the transactions contemplated thereby between the parties to the Transaction Agreements, does or will, with or without the giving of notice, lapse of time, or both, violate, conflict with, result in a breach of, or constitute a default under or give to others any right of termination, acceleration, cancellation, or other right under, (a) the Organizational Documents of the Company, (b) any agreement, document or instrument to which the Company is a party or by which the Company is bound or (c) any term or provision of any judgment, order, writ, injunction, or decree binding on the Company (or its assets or properties), except, in the case of clause (b) and (c), any such breaches or defaults that would not reasonably be expected to have a Company Material Adverse Effect.

Section 3.06 Validity of Company Shares. The Company Shares, when issued and delivered pursuant to the terms of the Transaction Agreements, will be duly authorized by the Company and will be validly issued by the Company, free and clear of all Liens created by the Company (other than Liens created by the charter of the Company, the Escrow Agreement, the Lock-up Agreement or the Transaction Agreements).

Section 3.07 Litigation. There is no action, suit or proceeding pending or, to the Company’s Knowledge, threatened against the Company, the Operating Partnership or any of their Subsidiaries which is reasonably expected to have a Company Material Adverse Effect, or which challenges or impairs the ability of the Company to execute or deliver, or perform its obligations under, the Transaction Agreements and the documents executed by it pursuant to the Transaction Agreements or to consummate the transactions contemplated thereby.

Section 3.08 Limited Activities. Except for activities in connection with the IPO or the Formation Transactions or in the ordinary course of business, the Company and the Operating Partnership and their Subsidiaries have not engaged in any material business or incurred any material obligations.

Section 3.09 Broker. None of the Company or the Operating Partnership or any of their members, partners, general partners, officers, directors or employees, to the extent applicable, has entered into any agreement with any broker, finder, or similar agent of any Person or firm that will result in the obligation of the Contributor to pay any finder’s fees, brokerage fees or commissions or similar payment in connection with the transactions contemplated by the Transaction Agreements.

Section 3.10 No Other Representations or Warranties. Other than the representations and warranties expressly set forth in this Article III, the Company shall not be deemed to have made any other representation or warranty in connection with the Transaction Agreements or the transactions contemplated thereby.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF THE CONTRIBUTOR

Except as disclosed in the disclosure letter delivered to the Company by the Contributor on the date hereof (the “Contributor Disclosure Letter”), the Contributor hereby represents and warrants to the Company as set forth below, and the Stockholder hereby represents and warrants to the Company as set forth in Section 4.13 below, which representations are true and correct as of the date hereof (or such other date specifically set forth below) and as of the Contribution Closing as if made again at that time (except to the extent that any representation or warranty only speaks as of an earlier date, in which case it is true and correct as of the earlier date):

Section 4.01 Organization; Authority.

(a) The Contributor is a corporation duly organized, validly existing and in good standing under the Laws of the State of Delaware, and has all requisite power and authority to enter into the Transaction Agreements, each agreement contemplated hereby to which it is a party and to carry out the transactions contemplated by the Transaction Agreements, and to own, lease or operate its assets and to carry on its business as presently conducted and, to the extent required under applicable Laws, is qualified to do business and is in good standing in each jurisdiction in which the nature of its business or the character of its property make such qualification necessary, other than in such jurisdictions where the failure to be so qualified would not reasonably be expected to have a Contributor Material Adverse Effect.

(b) Following the Conversion, the Contributor will be a limited liability company duly organized, validly existing and in good standing under the Laws of the State of Delaware and will have all requisite power and authority to enter into the Transaction Agreements, each agreement contemplated hereby to which it is a party and to carry out the transactions contemplated by the Transaction Agreements, and to own, lease or operate its assets and to carry on its business as presently conducted and, to the extent required under applicable Laws, is qualified to do business and is in good standing in each jurisdiction in which the nature of its business or the character of its property make such qualification necessary, other than in such jurisdictions where the failure to be so qualified would not reasonably be expected to have a Contributor Material Adverse Effect.

(c) Section 4.01(b) of the Contributor Disclosure Letter, sets forth as of the date hereof, with respect to the Contributor, (i) the name and the jurisdiction of organization or incorporation, as the case may be, of each Subsidiary of the Contributor (“Contributor Subsidiary”) and (ii) the ownership interest of the Contributor or other Contributor Subsidiary in each such Contributor Subsidiary. Each Contributor Subsidiary has been duly organized or formed and is validly existing under the laws of its jurisdiction of organization or formation, as applicable, has all power and authority to own, lease or operate its property and to carry on its business as presently conducted and, to the extent required under applicable Laws, is qualified to do business and is in good standing in each jurisdiction in which the nature of its business or the character of its property make such qualification necessary, except where the failure to be so qualified would not reasonably be expected to have a Contributor Material Adverse Effect.

(d) The Contributor or Contributor Subsidiaries own the equity interests in the Persons set forth on Section 4.01(d) of the Contributor Disclosure Letter (together with the Subsidiaries of such Persons, the “JV Entities”) in the stated percentage set forth on Section 4.01(d) of the Contributor Disclosure Letter.

(e) The Contributor has made available to the Company a complete and correct copy of the operating agreement for Arcade LLC, which will be executed immediately following completion of the Conversion by the Stockholder, which will be the sole Equity Holder of Arcade LLC.

Section 4.02 Due Authorization. The execution, delivery and performance of the Transaction Agreements by the Contributor and the Stockholder have been duly and validly authorized by all necessary action required of the Contributor and the Stockholder, respectively. The Transaction Agreements and each agreement, document and instrument executed and delivered by or on behalf of the Contributor and the Stockholder pursuant to the Transaction Agreements constitutes, or when executed and delivered will constitute, the legal, valid and binding obligation of the Contributor and the Stockholder, each enforceable against the Contributor and the Stockholder in accordance with its terms, subject to applicable bankruptcy, insolvency, moratorium or other similar Laws relating to creditors’ rights and general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).

Section 4.03 Ownership of Contributed Interests; Capitalization.

(a) The Contributor is the owner of the Contributed Interests and has the power and authority to transfer, sell, assign and convey to the Company the Contributed Interests free and clear of any Liens (other than Permitted Liens) and, upon delivery of the consideration for the Contributed Interests as provided herein, the Company will acquire good and valid title thereto, free and clear of any Liens (other than Permitted Liens). Except as provided for or contemplated by this Contribution Agreement or any other agreements referenced herein, there are no, and, as of the Contribution Closing, there will not be any rights, subscriptions, warrants, options, conversion rights, preemptive rights, agreements, instruments or understandings of any kind outstanding entitling any Person to acquire any equity interests in the Contributor

Subsidiaries or JV Entities, except pursuant to Permitted Liens or rights established pursuant to the terms of the Organizational Documents and related agreements with respect to the Contributor Subsidiaries and JV Entities that have been previously disclosed to the Company.

(b) The sole stockholder of Arcade is the Stockholder. Following the Conversion, the sole equity holder of Arcade LLC entitled to receive the Merger Consideration pursuant to the Merger Agreement, subject to the Indemnity Holdback Amount, will be the Stockholder.

Section 4.04 Consents and Approvals. Except as shall have been satisfied on or prior to the Contribution Closing Date, no consent, waiver, approval or authorization of, or filing with, any Person or Governmental Authority or under any applicable Laws is required to be obtained by the Contributor, any Contributor Subsidiary, any JV Entity or the Stockholder in connection with the execution, delivery and performance of the Transaction Agreements, and the transactions contemplated by the Transaction Agreements, except for those consents, waivers, approvals, authorizations or filings, the failure of which to obtain or to file would not have a Contributor Material Adverse Effect.

Section 4.05 Taxes.

(a) The Contributor and each Contributor Subsidiary and JV Entity has timely filed, or will timely file, all Tax Returns required to be filed by it (after giving effect to any filing extension properly granted by a Governmental Authority having authority to do so) in accordance with all applicable Laws. All such Tax Returns are correct and complete in all material respects, and the Contributor and each Contributor Subsidiary and JV Entity has paid (or had paid on its behalf) all Taxes required to be paid by it (whether or not shown on such Tax Returns), and no deficiencies for any Taxes have been proposed, asserted or assessed in writing against the Contributor or any Contributor Subsidiary or JV Entity, and no requests for waivers of the time to assess any such Taxes are pending and no such waivers have been granted.

(b) There are no Liens as a result of any unpaid Taxes (other than statutory liens for Taxes not yet due and payable) upon any of the assets or property of the Contributor, any Contributor Subsidiary or any JV Entity.

(c) Except as would not reasonably be expected to have a Contributor Material Adverse Effect, there are no pending or, to the Contributor’s Knowledge, threatened audits, assessments or other actions for or relating to a liability in respect of income or non-income Taxes of the Contributor, any Contributor Subsidiary or any JV Entity.

(d) The Contributor has entered into this Agreement for good and valid business reasons.

(e) The Stockholder has no plan or intention to sell, exchange or transfer equity interests in Arcade LLC or stock in the Contributor for consideration other than Company Common Stock, in contemplation of the Contribution or Merger, to the Company (or any party related to the Company) or sell, exchange or transfer any Company Common Stock received in the Merger to the Company (or any party related to the Company).

(f) The Contributor has not agreed to assume, nor will assume, directly or indirectly, any expense or other liability, whether fixed or contingent, of the Stockholder in connection with or as part of the Merger or any related transaction.

(g) No part of the Company Common Stock issued pursuant to this Agreement or the Merger Consideration will be received by the Stockholder as a creditor, employee or in any capacity other than as an equity holder in Arcade LLC or stockholder of Arcade.

(h) The Contributor is a “United States real property holding corporation” for U.S. federal income tax purposes.

(i) All of the equity interests in the Stockholder are held by ▇▇▇▇▇▇▇▇▇ ▇▇▇▇.

(j) The Contributor holds cash or cash equivalents (excluding any cash or cash equivalents taken into account in the net amount of tangible assets and liabilities set forth in Section 4.16 of the Disclosure Letter) in an amount that is at least equal to the unpaid Taxes owed by it for all taxable periods ending on or prior to the Contribution Closing Date.

(k) None of the Contributor or any Contributor Subsidiary is or ever has been a party to or bound by, or could have any liability under, any Tax indemnity agreement, Tax sharing agreement, Tax allocation agreement or similar contract or arrangement (other than commercial agreements entered into in the ordinary course of business, the principal purpose of which is not related to Taxes).

(l) None of the Contributor or any Contributor Subsidiary has any liability for Taxes of any person arising from the application of Treasury Regulations Section 1.1502-6 or any analogous provision of state, local or foreign law (other than in respect of being a member of a consolidated group the common parent of which is the Contributor), or as a transferee or successor.

Section 4.06 No Violation. None of the execution, delivery or performance of the Transaction Agreements, any agreement contemplated thereby between the parties to the Transaction Agreements and the transactions contemplated by the Transaction Agreements, does or will, with or without the giving of notice, lapse of time, or both, violate, conflict with, result in a breach of, or constitute a default under or give to others any right of termination, acceleration, cancellation or other right under, (a) the Organizational Documents of the Contributor, any Contributor Subsidiary, any JV Entity or the Stockholder, (b) any agreement, document or instrument to which the Contributor, any Contributor Subsidiary, any JV Entity or the Stockholder is a party or by which the Contributor, any Contributor Subsidiary, any JV Entity or the Stockholder are bound or (c) any term or provision of any judgment, order, writ, injunction, or decree binding on the Contributor, any Contributor Subsidiary, any JV Entity or the Stockholder (or their assets or properties), except, in the case of clause (b) and (c), any such breaches or defaults that would not reasonably be expected to have a Contributor Material Adverse Effect.

Section 4.07 Solvency. The Contributor has been and will be solvent at all times prior to the transfer of the Contributed Interests to the Company. No bankruptcy or similar insolvency proceeding has been filed or is currently contemplated by the Contributor, any Contributor Subsidiary or any JV Entity thereof.

Section 4.08 Litigation. Except for actions, suits or proceedings covered by the policies of insurance described in Section 4.11, as of the date hereof, there is no action, suit or proceeding pending or, to the Contributor’s Knowledge, threatened against the Contributor, any Contributor Subsidiary or any JV Entity which, if adversely determined, would, individually or together with all such other actions, reasonably be expected to have a Contributor Material Adverse Effect. As of the date hereof, there is no action, suit or proceeding pending or, to the Contributor’s Knowledge, threatened against the Contributor, any Contributor Subsidiary or any JV Entity which challenges or impairs the ability of the Contributor to execute or deliver, or perform its obligations under this Contribution Agreement or to consummate the transactions contemplated hereby, including the Merger.

Section 4.09 Licenses and Permits. To the Contributor’s Knowledge, all notices, licenses, permits, certificates and authorizations required for the continued use, occupancy, management, leasing and operation of the Properties have been obtained or can be obtained without material cost, are in full force and effect, are in good standing and (to the extent required in connection with the transactions contemplated by the Transaction Agreements) are assignable to the Company, except in each case for items that would not, individually or in the aggregate, have a Contributor Material Adverse Effect. To the Contributor’s Knowledge, neither the Contributor, any Contributor Subsidiary, any JV Entity nor any third party has taken any action that (or failed to take any action the omission of which) would result in the revocation of any such notice, license, permit, certificate or authorization where such revocation or revocations would, individually or in the aggregate, reasonably be expected to have a Contributor Material Adverse Effect, nor has any of them received within the past one year any written notice of violation from any Governmental Authority or written notice of the intention of any entity to revoke any of them, that in each case has not been cured or otherwise resolved to the satisfaction of such Governmental Authority and that would not, individually or in the aggregate, reasonably be expected to have a Contributor Material Adverse Effect.

Section 4.10 Properties.

(a) The Properties are owned directly, in fee simple, by the Persons set forth on Section 4.10 of the Contributor Disclosure Letter or their direct or indirect wholly owned subsidiaries. Each Contributor Subsidiary or JV Entity listed as owning a Property on Section 4.10 of the Contributor Disclosure Letter is insured under a policy of title insurance as the owner of the fee simple estate (or, in the case of certain Properties, the leasehold estate) of such Property, in each case free and clear of all Liens except for Permitted Liens and Liens, if any, given to secure mortgage indebtedness encumbering such Property. Prior to the effective time of the transactions contemplated in this Contribution Agreement, no Contributor Subsidiary or JV Entity shall take or omit to take any action to cause any Lien to attach to any Property, except for Permitted Liens and Liens, if any, given to secure mortgage indebtedness encumbering such Property.

(b) Except for matters that would not, individually or in the aggregate, reasonably be expected to have a Contributor Material Adverse Effect, (i) no Contributor

Subsidiary, JV Entity, nor any other party to any agreement affecting any Property to which the Contributor, a Contributor Subsidiary or JV Entity is a party (other than a Lease (as such term is hereinafter defined) for space within such Property), has given or received any notice of default with respect to any term or condition of any such agreement, including, without limitation, any ground lease, (ii) no event has occurred or has been threatened in writing, which with or without the passage of time or the giving of notice, or both, would, individually or together with all such other events, constitute a default under any such agreement, or would, individually or together with all such other events, reasonably be expected to cause the acceleration of any material obligation of any party thereto or the creation of a Lien upon any asset of any Contributor Subsidiary or JV Entity, except for Permitted Liens, and (iii) all agreements affecting any Property required for the continued use, occupancy, management, leasing and operation of such Property (exclusive of space leases) are valid and binding and in full force and effect. No Contributor Subsidiary or JV Entity has granted an option or right of first refusal or offer pursuant to the leases with respect to the sale of any Property.

(c) As presently conducted, none of the operation of the buildings, fixtures and other improvements comprising a part of the Properties is in violation of any applicable building code, zoning ordinance or other law or regulation, except for such violations that would not, individually or in the aggregate, reasonably be expected to have a Contributor Material Adverse Effect. Neither the Contributor nor any Contributor Subsidiary nor any JV Entity has received any written notice from a Governmental Authority of any pending or threatened proceedings for the rezoning of any Property or portion thereof except for such notices or proceedings that would not, individually, or in the aggregate, reasonably be expected to have a Contributor Material Adverse Effect.

(d) Except for matters that would not, individually or in the aggregate, reasonably be expected to have a Contributor Material Adverse Effect, (i) to the Contributor’s Knowledge, neither the Contributor, any Contributor Subsidiary nor any JV Entity, nor any other party to any Lease, has given or received any notice of default with respect to any term or condition of any such Lease, (ii) to the Contributor’s Knowledge, no event has occurred or has been threatened in writing, which with or without the passage of time or the giving of notice, or both, would, individually or together with all such other events, constitute a default under any Lease, or would, individually or together with all such other events, reasonably be expected to cause the acceleration of any material obligation of any party thereto or the creation of a Lien upon any asset of the Contributor, the Contributor’s Subsidiaries or the JV Entities, except for Permitted Liens, and (iii) each of the leases (and all amendments thereto or modifications thereof) to which the Contributor, any Contributor Subsidiary or any JV Entity is a party or by which any Contributor, Contributor Subsidiary or JV Entity or any Property is bound or subject (collectively, the “Leases”) is and will be valid and binding and in full force and effect.

(e) Except for matters that would not, individually or in the aggregate, reasonably be expected to have a Contributor Material Adverse Effect, each of the Leases to which the Contributor, any Contributor Subsidiary or any JV Entity is a party or by which the Contributor, any Contributor Subsidiary, JV Entity or any Property is bound or subject, is in full force and effect, and constitutes the legal, valid and binding obligation of the Contributor or the applicable Contributor Subsidiary or JV Entity, and to the Contributor’s Knowledge, each other party thereto, enforceable against each Contributor Subsidiary or JV Entity, and to the

Contributor’s Knowledge, each other party thereto, in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and similar Laws affecting creditors’ rights generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).

(f) To the Contributor’s Knowledge, except as previously disclosed to the Company, no tenant under any such Lease is presently the subject of any voluntary or involuntary bankruptcy or insolvency proceedings, except for matters that would not, individually or in the aggregate, reasonably be expected to have a Contributor Material Adverse Effect.

Section 4.11 Insurance. The Contributor or the applicable Contributor Subsidiary or JV Entity has in place the public liability, casualty and other insurance coverage with respect to each Property as the Contributor reasonably deems necessary. Each of the insurance policies with respect to the Properties is in full force and effect in all material respects and none of the Contributor or the applicable Contributor Subsidiary or JV Entity is in default (in any material respect) under any such policies.

Section 4.12 Environmental Matters. Except for matters that would not, individually or in the aggregate, reasonably be expected to have a Contributor Material Adverse Effect (a) the Contributor Subsidiaries and the JV Entities are in compliance with all applicable Environmental Laws (b) neither the Contributor Subsidiaries nor any JV Entity have received within the past three years any written notice from any Governmental Authority or third party alleging that any Contributor Subsidiary, any JV Entity or any Property is not in compliance with applicable Environmental Laws, and (c) there has not been a release of a hazardous substance on any Property that would require investigation or remediation under applicable Environmental Laws. The representations and warranties contained in this Section 4.12 constitute the sole and exclusive representations and warranties made by the Contributor concerning environmental matters.

Section 4.13 Investment. The Stockholder acknowledges that the offering and issuance of the Company Shares to be acquired pursuant to this Contribution Agreement and the Merger Agreement are intended to be exempt from registration under the Securities Act and that the Company’s reliance on such exemptions is predicated in part on the accuracy and completeness of the representations and warranties of the Stockholder contained herein. In furtherance thereof, the Stockholder represents and warrants to the Company as follows:

(a) The Stockholder is an “accredited investor” (as such term is defined in Rule 501(a) of Regulation D promulgated under the Securities Act).

(b) The Stockholder is acquiring the Company Shares solely for its own account for the purpose of investment and not as a nominee or agent for any other Person and not with a view to, or for offer or sale in connection with, any distribution of any thereof in violation of the securities Laws.

(c) The Stockholder acknowledges that the Company Shares have not been registered under the Securities Act and, therefore, may not be sold unless registered under the Securities Act or an exemption from registration is available.

Section 4.14 Broker. None of the Contributor, any Contributor Subsidiary, JV Entity, or any of their managing members, members, partners, general partners, officers directors or employees, to the extent applicable, has entered into any agreement with any broker, finder, or similar agent of any Person or firm that will result in the obligation of the Company, the Operating Partnership or any of their Affiliates to pay any finder’s fees, brokerage fees or commissions or similar payment in connection with the transactions contemplated by this Contribution Agreement or other Formation Transactions.

Section 4.15 Eminent Domain. There is no existing or, to the Contributor’s Knowledge threatened, in writing condemnation, eminent domain or similar proceeding that would affect any of the Properties. Neither the Stockholder nor any Contributor Subsidiary nor any JV Entity has received any written notice from a Governmental Authority of any pending or threatened condemnation, eminent domain or similar proceeding that would affect any of the Properties.

Section 4.16 Assets and Liabilities. Section 4.16 of the Contributor Disclosure Letter accurately sets forth, in all material respects, as of June 30, 2014 and September 30, 2014, (i) all outstanding indebtedness of the Contributor, the Contributor Subsidiaries and each JV Entity, (iii) all interest rate swap liabilities of such entities and (iii) the net amount of all other tangible assets and liabilities of such entities (other than deferred tax liabilities, if any, and their interests in the Properties), which consists of cash, cash equivalents, accounts receivable and accounts payable. Except for distributions set forth on Section 4.16 of the Contributor Disclosure Letter (“Permitted Distributions”) or as contemplated by this Contribution Agreement (“Permitted Activities”), since September 30, 2014, the Contributor has not (i) made any distributions or (ii) entered into any transactions with an Affiliate other than on an arm’s-length basis. Section 4.16 of the Contributor Disclosure Letter accurately sets forth all contributions made to the Contributor by its Stockholder since September 30, 2014.

Section 4.17 No Other Representations or Warranties. Other than the representations and warranties expressly set forth in this Article IV, the Contributor shall not be deemed to have made any other representation or warranty in connection with this Contribution Agreement or the transactions contemplated hereby.

ARTICLE V

INDEMNIFICATION

Section 5.01 Company Indemnification. Subject to the indemnification limitations set forth in this Contribution Agreement, from and after the Contribution Closing Date, the Company shall indemnify and hold harmless the Stockholder and its officers, employees, partners, members, agents, representatives and Affiliates (each of which is a “Contributor Indemnified Party”) from and against any and all charges, complaints, claims, actions, causes of action, losses, damages, liabilities and expenses of any nature whatsoever, including without limitation, amounts paid in settlement, reasonable attorneys’ fees, costs of investigation, costs of

investigative judicial or administrative proceedings or appeals therefrom and costs of attachment or similar bonds (collectively, “Losses”) in excess of the greater of (i) 4.5% of the Company Cap or (ii) $250,000, in each case in the aggregate, arising out of or relating to, asserted against, imposed upon or incurred by a Contributor Indemnified Party in connection with or as a result of any breach of a representation, warranty or covenant of the Company contained in the Transaction Agreements or in any schedule, exhibit, certificate or affidavit or any other document delivered by the Company pursuant to the Transaction Agreements; provided, however, that the Company shall not have any obligation under this Section 5.01 to indemnify any Contributor Indemnified Party against any Losses to the extent that such Losses arise by virtue of the Contributor’s breach of this Contribution Agreement, gross negligence, willful misconduct or fraud.

Section 5.02 Stockholder Indemnification.

(a) Subject to the indemnification limitations set forth in this Contribution Agreement, from and after the Contribution Closing Date, the Indemnity Holdback Amount shall be used to indemnify and hold harmless the Company, the Operating Partnership and each of their respective directors, officers, employees, agents, representatives and Affiliates (each of which is a “Company Indemnified Party”) from and against any and all Losses in excess of the greater of (i) 4.5% of the Indemnity Holdback Amount or (ii) $250,000, in each case in the aggregate (the “Deductible”), arising out of or relating to, asserted against, imposed upon or incurred by such Company Indemnified Party in connection with or as a result of any breach of a representation, warranty or covenant of the Contributor or Stockholder in the Transaction Agreements or in any schedule, exhibit, certificate or affidavit or any other document delivered by the Contributor or the Stockholder pursuant to the Transaction Agreements; provided, however, that the Stockholder shall not have any obligation under this Section 5.02 to indemnify any Company Indemnified Party against any Losses to the extent that such Losses arise by virtue of the Company’s breach of this Contribution Agreement, gross negligence, willful misconduct or fraud; provided further, however, that, to the extent such Losses relate to breach of a representation, warranty or covenant of the Contributor regarding a Person or the assets and liabilities of a Person that the Company or the Operating Partnership has or acquires an interest in from a Person other than the Contributor, the indemnification pursuant to this Section 5.02 shall be limited to the portion of such Losses attributable to the interest acquired from the Contributor pursuant to this Contribution Agreement. The Stockholder hereby grants to the Company a security interest in the Company Shares held as the Indemnity Holdback Amount to secure the indemnification obligations set forth in this Section 5.02.

(b) Any indemnification payment made by the Company to the Stockholder pursuant to the Transaction Agreements shall be made to such Stockholder in shares of Company Common Stock, the number of which shall equal the dollar value of the indemnification payment divided by the price of a share of Company Common Stock as of the close of market on the date of such indemnification payment.

Section 5.03 Notice of Claims At the time when any Contributor Indemnified Party or Company Indemnified Party, as applicable, (as applicable, an “Indemnified Party”) learns of any potential claim (a “Claim”) under this Article V that is asserted against the Indemnified Party that is subject to indemnification by the Company or in respect of the Contributor from the

Indemnity Holdback Amount, as applicable, under this Article V (as applicable, the “Indemnifying Party”), such Indemnified Party will promptly give written notice (a “Claim Notice”) to the Indemnifying Party (or in the case of the Company Indemnified Parties, to the Stockholder’s Representative); provided that failure to do so shall not prevent recovery under this Contribution Agreement, except to the extent that the Indemnifying Party shall have been materially prejudiced by such failure. Each Claim Notice shall describe in reasonable detail the facts known to the Indemnified Party giving rise to such Claim, and the amount or good faith estimate of the amount of Losses arising therefrom. Unless prohibited by Law, the Indemnified Party shall deliver to the Indemnifying Party (or in the case of the Company Indemnified Parties, to the Stockholder’s Representative), promptly after the Indemnified Party’s receipt thereof, copies of all notices and documents (including court papers) received by the Indemnified Party relating to a Third Party Claim (defined below), and failure to do so shall prevent recovery under this Contribution Agreement to the extent that the Indemnifying Party shall have been materially prejudiced by such failure.

Section 5.04 Third Party Claims. The Indemnifying Party (through the Stockholder’s Representative in the event the Indemnified Party is a Company Indemnified Party) shall be entitled, at its own expense, to assume and control the defense of any Claims based on claims asserted by third parties (“Third Party Claims”), through counsel chosen by the Indemnifying Party (or in the case of the Company Indemnified Parties, to the Stockholder’s Representative), if it gives written notice of its intention to do so to the Indemnified Parties within thirty (30) days of the receipt of the applicable Claim Notice; provided, however, that the Indemnified Parties may at all times participate in such defense at their expense provided, further, that if any such Third Party Claim relates to Taxes of the Contributor, any Contributor Subsidiary, or any JV Entity, or seeks non-monetary damages or asserts damages in excess of the Indemnity Holdback Amount against a Company Indemnified Party, then, notwithstanding anything in this Contribution Agreement to the contrary, the Company (or a Subsidiary of the Company) shall have the right to control any such Third Party Claim. Without limiting the foregoing, in the event that the Indemnifying Party exercises the right to undertake any such defense against a Third Party Claim, the Indemnified Party shall cooperate with the Indemnifying Party in such defense and make available to the Indemnifying Party (unless prohibited by Law), at the Indemnifying Party’s expense, all witnesses, pertinent records, materials and information in the Indemnified Party’s possession or under the Indemnified Party’s control relating thereto as is reasonably required by the Indemnifying Party. No compromise or settlement of such Third Party Claim may be effected by either the Indemnified Party, on the one hand, or the Indemnifying Party (or in the case of the Company Indemnified Parties, the Stockholder’s Representative), on the other hand, without the other’s consent (which shall not be unreasonably withheld or delayed) unless (a) there is no finding or admission of any violation of Law and no effect on any other claims that may be made against such other party and (b) each Indemnified Party that is party to such claim is released from all liability with respect to such claim; provided that the Stockholder’s Representative shall be deemed to have consented to any proposed compromise or settlement to which it has not objected to by written notice within 30 days after notice of such proposed compromise or settlement was provided by a Company Indemnified Party.

Section 5.05 Survival of Representations and Warranties. All representations and warranties of the Contributor and the Company, as applicable, contained in this Contribution Agreement shall survive after the Closing until the first anniversary of the Contribution Closing

Date (the “Expiration Date”). If written notice of a Claim in accordance with the provisions of Section 5.03 has been given prior to the Expiration Date, then the relevant representation and warranty shall survive, but only with respect to such specific Claim, until such Claim has been finally resolved. Any claim for indemnification not so asserted in writing by the Expiration Date may not thereafter be asserted and shall forever be waived.

Section 5.06 Establishment of Indemnity Holdback Escrow. On the Contribution Closing Date, the Company shall deposit the Indemnity Holdback Amount in accordance with the terms and conditions of the Escrow Agreement. The Company agrees that the security interest in the Company Shares may be released, or collateral may be substituted for such Company Shares, in accordance with the Escrow Agreement.

Section 5.07 Exclusive Remedy.

(a) Except as set forth in Sections 2.07 and 6.05, the sole and exclusive remedy for Company Indemnified Parties for any breach, misrepresentation or other matters relating to or arising in connection with the Transaction Agreements and any of the agreements, documents or instruments executed and delivered in connection therewith and any of the transactions contemplated thereby shall be indemnification pursuant to the provisions of this Article V and the Stockholder shall not be liable or obligated to make payments under this Contribution Agreement to the extent such payments in the aggregate exceed the Indemnity Holdback Amount.

(b) Except as set forth in Section 6.04, the sole and exclusive remedy for Contributor Indemnified Parties for any breach, misrepresentation or other matters relating to or arising in connection with the Transaction Agreements and any of the agreements, documents or instruments executed and delivered in connection therewith and any of the transactions contemplated thereby shall be indemnification pursuant to the provisions of this Article V and the Company shall not be liable or obligated to make payments under this Contribution Agreement to the extent such payments in the aggregate exceed the dollar amount obtained by multiplying the number of Company Shares included in the Indemnity Holdback Amount by the Price to the Public (the “Company Cap”).

Section 5.08 Tax Treatment. All indemnity payments made hereunder shall be treated as adjustments to the consideration paid hereunder for U.S. federal income tax purposes, unless otherwise required by applicable Laws.

ARTICLE VI

COVENANTS AND OTHER AGREEMENTS

Section 6.01 Covenants of the Contributor. From the date hereof through the Merger Closing, except as otherwise provided for or as contemplated by the Transaction Agreements, the Contributor shall and shall cause the Contributor Subsidiaries and JV Entities, to the extent the Contributor or the Contributor Subsidiaries control such JV Entities, to, use commercially reasonable efforts to conduct their business and operate and maintain the Properties in the ordinary course, consistent with past practices. In addition, the Contributor:

(a) will not make any distributions, other than Permitted Distributions;

(b) except for Permitted Activities, will not enter into any transactions with an Affiliate other than on an arm’s-length basis;

(d) will not mortgage, pledge, hypothecate, encumber (or permit to become encumbered) all or any portion of its Property Interests, except for Permitted Liens.

Section 6.02 Stockholder’s Representative. The Stockholder hereby appoints ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇ as the representative for the Stockholder (the “Stockholder’s Representative”) and the Stockholder’s Representative shall have the authority to take the actions provided herein and receive notices on behalf of the Stockholder subsequent to the Merger Closing.

Section 6.03 Tax Covenants.

(a) Each party hereto (i) shall cause all Tax Returns relating to the Contribution, Conversion and Merger to be filed on the basis of treating the Contribution, Conversion and Merger, taken together, as a “reorganization” within the meaning of Section 368(a) of the Code and (ii) shall not take any position on any Tax Return, or take any other reporting position, that is inconsistent with such treatment, unless otherwise required by applicable Laws.

(b) The Contributor shall provide the Company with such reasonable cooperation and information relating to the Contributor, any Contributor Subsidiary and any JV Entity as the Company reasonably requires in (i) filing any Tax Return, amended Tax Return or claim for Tax refund, (ii) determining any liability for Taxes or a right to a Tax refund, (iii) conducting or defending any proceeding in respect of Taxes or (iv) performing Tax diligence, including with respect to the impact of the transactions contemplated herein on the Company’s qualification as a REIT for U.S. federal income Tax purposes and the qualification of the Contribution, Conversion and Merger, taken together, as a reorganization under Section 368(a) of the Code.

(c) The Company shall be responsible for the prosecution of any claim or audit instituted after the Contribution Closing Date with respect to Taxes of the Contributor, any Contributor Subsidiary, or any JV Entity, attributable to any taxable period, or portion thereof, ending on or before the Contribution Closing Date.

(d) Following the Merger Closing, to the extent the Stockholder has provided a FIRPTA Notice pursuant to Section 2.01(b)(iv)(A) instead of cash sufficient to fund withholding pursuant to Section 2.01(b)(iv)(B), the Stockholder shall provide the Company with evidence satisfactory to the Company that the Stockholder has complied with the requirements of Temporary Treasury Regulations Section 1.897-5T(d)(1)(iii), as modified by IRS Notice 89-57 with respect to the transactions contemplated hereby.

(e) Within 20 days after the Closing, the Company shall submit to the Internal Revenue Service the FIRPTA notice provided to it by the Stockholder pursuant to Section 2.01(b)(iv), in accordance with the requirements of Treasury Regulation Section 1.1445-2(d)(2)(i)(B).

(f) The Company shall (a) cause to be timely paid any ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ real property transfer taxes payable by the Contributor as a result of, or in connection with, the Contribution (collectively, the “New York Transfer Taxes”); provided, that the parties hereto acknowledge and agree that such amount of New York Transfer Taxes payable shall reflect the Company’s status as a REIT; and (b) timely and properly file, with the Contributor’s cooperation, all Tax returns with respect to such New York Transfer Taxes.

Section 6.04 Tax Protection Provisions.

(a) With respect to the period commencing on, and including, the Effective Time and ending on, and including, December 31, 2014 (the “Covenant Period”), the Company shall not, and shall cause the Operating Partnership to not, both (x) incur, directly or indirectly, any gain from the sale or exchange of a U.S. real property interest (as described in Section 897(c) of the Code) and (y) distribute any such gain or any interest in U.S. real property if the effect thereof would be to cause the Stockholder to be treated for U.S. federal income tax purposes, as recognizing “effectively connected income” as a result of the operation of Section 897 of the Code, solely as a result of such distribution, during a taxable year of the Stockholder ending on or before December 31, 2014, (“Prohibited Event”), provided, however, the Company shall not be deemed to have violated this undertaking to the extent the Prohibited Event was caused by an unaffiliated third party’s actions or exercise of its rights, including, without limitation, a third party’s exercise of buy-sell or forced sale rights, gain incurred by an entity not controlled by the Company or the Operating Partnership where the gain is allocated to the Company or the Operating Partnership as a result of its direct or indirect investment in the entity, or other similar event over which neither the Company nor the Operating Partnership would reasonably be expected to exercise control that results in a Prohibited Event (such covenant being referred to as the “No Gain Covenant”). The parties agree that the sole remedy for a violation of the No Gain Covenant shall be indemnification pursuant to, and subject to the conditions of, this Section 6.04 and, for the avoidance of doubt, not specific performance. Accordingly, for example, the Company may make a distribution in violation of No Gain Covenant to the extent it reasonably determines such distribution is required for the Company to maintain its qualification as a REIT for U.S. federal income tax purposes; provided that, in connection with such distribution, the Company will be required to indemnify the Stockholder pursuant to, and subject to the conditions of, this Section 6.04.

(b) If the Company becomes aware that a gain described in clause (x) of the first sentence of Section 6.04(a) is planned or scheduled to be incurred due to the actions or exercise of rights by an unaffiliated third party, the Company will use, and will cause the Operating Partnership to use, reasonable efforts to seek to have such third party delay the Prohibited Event until after the end of the Covenant Period; provided, however, that the Company shall not be required to incur any costs or expense in obtaining such delay but will permit the Stockholder to fund such costs and expenses if the Company or Operating Partnership is otherwise able through the use of its reasonable efforts to obtain such delay and, notwithstanding the occurrence of such Prohibited Event, the Company shall not, and shall cause the Operating Partnership to not, make a distribution with respect thereto, except to the extent it determines in good faith that such distribution is required for the Company to maintain its qualification as a REIT for U.S. federal income tax purposes.

(c) If a Prohibited Event occurs in violation of the No Gain Covenant, the Stockholder agrees as follows: (w) if notified of the occurrence of such Prohibited Event, to make the filings required by Treasury Regulations Section 1.897-5T(d)(1)(iii) with its U.S. federal income tax return (or amended return) for the year in which the Effective Time occurs; (x) that such Stockholder will take the position for U.S. federal income tax purposes that notwithstanding the occurrence of such Prohibited Event, a subsequent disposition of Company Shares received in the Merger by such Stockholder is not subject to U.S. federal income tax (under Section 897 of the Code) if the Company Shares are not a “U.S. real property interest” with respect to such Stockholder at the time of the disposition (“No-Tax Position”) unless such Stockholder receives an opinion from a Big 4 accounting firm (or other mutually agreeable firm) that there is no substantial authority for asserting the No-Tax Position; (y) in the event the No-Tax Position is challenged by the Internal Revenue Service, the Stockholder will use reasonable best efforts to contest the challenge provided that the Company indemnifies, or causes the Operating Partnership to indemnify, for the Stockholder’s reasonable defense costs; and without limitation (z) otherwise to cooperate with the Company and/or Operating Partnership to mitigate any losses that may arise as a result of such Prohibited Event.

(d) If a Prohibited Event occurs in violation of the No Gain Covenant, the Company will indemnify the Stockholder for the incremental net income tax liability actually incurred by such Stockholder as a result of such violation of the No Gain Covenant to the extent that (x) such violation causes the Stockholder’s receipt of Company Shares in the transactions contemplated herein or the Merger Agreement to be treated as a taxable exchange under Section 897 of the Code or (y) such breach causes gain from an actual sale or other disposition of Company Shares received in the transactions contemplated herein by the Stockholder to be taxed under Section 897 of the Code, provided, however, that (i) such Stockholder shall not be indemnified for any such tax liability under this Section 6.04 if such Stockholder breached a covenant in Section 6.04(c) and, (ii) for the avoidance of doubt, to the extent gain realized in the Merger or a disposition of Company Shares received in the Merger would be subject to U.S. federal income tax regardless of such violation of the No Gain Covenant, the Company will have no liability hereunder for such violation.

(e) The indemnification notice and claim procedures set forth in Section 5.03 shall apply to the indemnification obligations set forth in this Section 6.04.

Section 6.05 Liability for Transfer Taxes. The Stockholder agrees to indemnify the Company for any Incremental Transfer Taxes incurred as a result of any direct or indirect transfers of the Company Shares received in connection with the transactions contemplated hereby, or interests therein (other than the receipt of the Merger Consideration by the Stockholder pursuant to the Merger Agreement) within two years after the IPO Closing Date; provided that such Company Shares shall be the Company’s sole recourse with respect to such indemnification obligation. The Stockholder hereby grants a security interest in 50% of its Company Shares received in the Merger to the Company and hereby irrevocably appoints the Company, and any of its agents, officers, or employees as its attorney-in fact, which shall be deemed coupled with an interest, with full power to prepare, execute and deliver any documents,

instruments and agreements as may be appropriate to perfect and continue such security interest in favor of the Company. The security interest granted pursuant to this Section 6.05 shall attach to the Company Shares that are not included in the Indemnity Holdback Amount. The Company agrees that the security interest in the Company Shares received by the Stockholder in the Merger may be released, or collateral may be substituted, in accordance with the terms of the Escrow Agreement.

Section 6.06 Commercially Reasonable Efforts By the Company and the Contributor. Each of the Company and the Contributor shall use commercially reasonable efforts and cooperate with each other in (a) promptly determining whether any filings are required to be made or consents, approvals, waivers, permits or authorizations are required to be obtained (under any applicable Laws or regulation or from any Governmental Authority or third party) in connection with the transactions contemplated by this Contribution Agreement, and (b) promptly making any such filings, in furnishing information required in connection therewith and in timely seeking to obtain any such consents, approvals, waivers, permits or authorizations.

ARTICLE VII

GENERAL PROVISIONS

Section 7.01 Notices. All notices and other communications under the Transaction Agreements shall be in writing and shall be deemed given when (a) delivered personally, (b) five (5) Business Days after being mailed by certified mail, return receipt requested and postage prepaid, (c) one (1) Business Day after being sent by a nationally recognized overnight courier or (d) transmitted by facsimile if confirmed within 24 hours thereafter by a signed original sent in the manner provided in clause (a), (b) or (c) to the parties at the following addresses (or at such other address for a party as shall be specified by notice from such party):

(a) if to the Company to:


Paramount Group, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile:		(▇▇▇) ▇▇▇-▇▇▇▇
Attention:		General Counsel

(b) If to the Contributor, the Stockholder or the Stockholder’s Representative, to Arcade Rental Investments, Inc.

c/o CURA Vermögensverwaltung, G.m.b.H. & Co. ▇▇

▇▇▇▇▇▇-▇▇▇▇-▇▇▇▇▇▇ ▇-▇

▇-▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇

Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇

Fax: ▇▇▇-▇▇-▇▇▇▇-▇▇▇▇

Section 7.02 Definitions. For purposes of this Contribution Agreement, the following terms shall have the following meanings:

(a) “Affiliate” means, with respect to any Person, a Person that, directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with the specified Person. For the purposes of this definition, “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”) as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise.

(b) “Business Day” means any day that is not a Saturday, Sunday or legal holiday in the State of New York.

(c) “Code” means the Internal Revenue Code of 1986, as amended, together with the rules and regulations promulgated or issued thereunder.

(d) “Company’s Knowledge” means the actual knowledge (without obligation to conduct due inquiry) of ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ of the matter in question (and not their constructive or imputed knowledge).

(e) “Company Material Adverse Effect” means a material adverse effect on the assets, business, financial condition or results of operations of the Company and the Operating Partnership and their Subsidiaries, taken as a whole, giving effect to the Formation Transactions and the IPO. For the avoidance of doubt, the Merger shall not be deemed a Company Material Adverse Effect.

(f) “Contributor Material Adverse Effect” means a material adverse effect on the assets, business, financial condition or results of operation of the Contributor and the Contributor Subsidiaries, taken as a whole, including such entities’ direct and indirect interests in the JV Entities. For the avoidance of doubt, the Merger shall not be deemed a Contributor Material Adverse Effect.

(g) “Contributor’s Knowledge” means the actual knowledge (without obligation to conduct due inquiry) of ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇ of the matter in question (and not their constructive or imputed knowledge).

(h) “Environmental Laws” means all federal, state and local Laws governing pollution or the protection of human health or the environment.

(i) “Governmental Authority” means any government or agency, bureau, board, commission, court, department, official, political subdivision, tribunal or other instrumentality of any government, whether federal, state or local, domestic or foreign.

(j) “Incremental Transfer Taxes” means any additional transfer taxes attributable to the transactions contemplated by this Agreement and the other Formation Transactions as a result of the failure of any such transaction to qualify as a “real estate investment trust transfer” under New York Tax Law section 1402 or under New York City Administrative Code section 11-2102 due to direct or indirect transfers of the Company Shares issued as Merger Consideration occurring within two years after the IPO Closing Date.

(k) “IPO Closing Date” means the closing date of the IPO.

(l) “Laws” means laws, statutes, rules, regulations, codes, orders, ordinances, judgments, injunctions, decrees and policies of any Governmental Authority.

(m) “Liens” means all pledges, claims, liens, charges, restrictions, controls, easements, rights of way, exceptions, reservations, leases, licenses, grants, covenants and conditions, encumbrances and security interests of any kind or nature whatsoever.

(n) “Organizational Documents” means with respect to any entity, the certificate of formation, limited liability company agreement, or operating agreement, certificate of incorporation, bylaws, certificate of limited partnership, limited partnership agreement and any other governing instrument, as applicable, including, without limitation, in the case of the Contributor, the Limited Liability Company Operating Company Agreement of Arcade Rental Investments LLC.

(o) “Permitted Liens” means (i) Liens for unpaid Taxes (other than statutory liens for Taxes not yet due and payable); (ii) zoning Laws generally applicable to the districts in which the Properties are located; (iii) easements for public utilities, encroachments, rights of access and/or other non-monetary matters that do not materially interfere with the use of the Properties; (iv) Liens securing Permitted Activities; (v) Liens arising in the ordinary course of business; (vii) Liens securing indebtedness outstanding as of September 30, 2014 or incurred on an arms’ length basis thereafter and (viii) any exceptions contained in the title policies relating to the Properties as of the Contribution Closing Date.

(p) “Person” means an individual, corporation, partnership, limited liability company, joint venture, association, trust, unincorporated organization or other entity.

(q) “Price to the Public” means the public offering price of a share of Company Common Stock sold in the IPO as shown on the cover page of the final prospectus forming part of the registration statement pursuant to which the shares of Company Common Stock offered in the IPO were registered under the Securities Act.

(r) “Registration Statement” means the Company’s registration statement on Form S-11, as amended from time to time, as filed with the SEC.

(s) “Securities Act” means the Securities Act of 1933, as amended, the rules and regulations promulgated thereunder.

(t) “Subsidiary” of any Person means any corporation, partnership, limited liability company, joint venture, trust or other legal entity of which such Person owns (either directly or through or together with another direct or indirect Subsidiary of such Person) either (i) a general partner, managing member or other similar interest, or (ii) (A) 50% or more of the voting power of the voting capital stock or other equity interests, or (B) 50% or more of the outstanding voting capital stock or other voting equity interests of such corporation, partnership, limited liability company, joint venture or other legal entity.

(u) “Tax” (and, with its correlative meaning, “Taxes”) means any and all taxes, including any interest, penalties, or other additions to tax that may become payable in respect thereof, which taxes shall include, without limiting the generality of the foregoing, all income taxes, profits taxes, taxes on gains, alternative minimum taxes, estimated taxes, payroll taxes, employee withholding taxes, unemployment insurance taxes, social security taxes, welfare taxes, disability taxes, severance taxes, license charges, taxes on stock, sales taxes, use taxes, ad valorem taxes, value added taxes, excise taxes, franchise taxes, gross receipts taxes, business license taxes, occupation taxes, real or personal property taxes, unclaimed property taxes, stamp taxes, environmental taxes, transfer taxes, workers’ compensation taxes, windfall taxes, net worth taxes, and other taxes, fees, duties, levies, customs, tariffs, imposts, assessments, obligations and charges of the same or of a similar nature to any of the foregoing.

(v) “Tax Return” means any return, statement, schedule, declaration, claim for refund, report, document or form filed or required to be filed with respect to Taxes, including any amendment, attachment and supplement thereof.

Section 7.03 Counterparts. This Contribution Agreement may be executed in counterparts, all of which shall be considered one and the same agreement and shall become effective when one or more counterparts have been signed by each party and delivered to each other party. All counterparts shall collectively constitute one agreement (or amendment, as applicable). The exchange of counterparts of this Contribution Agreement among the parties by means of facsimile transmission or by electronic transmission (pdf) which shall contain authentic reproductions shall constitute a valid exchange of this Contribution Agreement and shall be binding upon the parties hereto.

Section 7.04 Entire Agreement; Third-Party Beneficiaries. The Transaction Agreements and the Escrow Agreement, including, without limitation, the exhibits and schedules hereto and thereto, constitute the entire agreement and supersedes each prior agreement and understanding, whether written or oral, among the parties regarding the subject matter of the Transaction Agreements. The Transaction Agreements are not intended to confer any rights or remedies on any Person other than the parties hereto.

Section 7.05 Governing Law. The Transaction Agreements shall be governed by, and construed in accordance with, the Laws of the State of New York, regardless of any Laws that might otherwise govern under applicable principles of conflicts of laws thereof.

Section 7.06 Assignment. The Transaction Agreements shall be binding upon, and shall be enforceable by and inure to the benefit of, the parties hereto and thereto and their respective heirs, legal representatives, successors and assigns; provided, however, that the Transaction Agreements may not be assigned (except by operation of law) by any party without the prior written consent of the other parties, and any attempted assignment without such consent shall be null and void and of no force and effect, except that the Company may assign its rights and obligations hereunder and thereunder to an Affiliate. Notwithstanding the foregoing, the Transaction Agreements shall be assigned to Arcade LLC.

Section 7.07 Jurisdiction. The parties hereto hereby (a) submit to the exclusive jurisdiction of the United States District Court for the Southern District of New York or any New York state court sitting in New York City, New York, with respect to any dispute arising out of the Transaction Agreements or any transaction contemplated hereby or thereby to the extent such courts would have subject matter jurisdiction with respect to such dispute, and (b) irrevocably waive, and agree not to assert by way of motion, defense, or otherwise, in any such action, any claim that it is not subject personally to the jurisdiction of the above-named courts, that its property is exempt or immune from attachment or execution, that the action is brought in an inconvenient forum, or that the venue of the action is improper. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THE TRANSACTION AGREEMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY.

Section 7.08 Dispute Resolution. The parties intend that this Section 7.08 will be valid, binding, enforceable, exclusive and irrevocable and that it shall survive any termination of the Transaction Agreements.

(a) Upon any dispute, controversy or claim arising out of or relating to the Transaction Agreements or the enforcement, breach, termination or validity thereof (“Dispute”), the party raising the Dispute will give written notice to the other parties to the Dispute describing the nature of the Dispute following which the parties to such Dispute shall attempt for a period of ten (10) Business Days from receipt by the parties of notice of such Dispute to resolve such Dispute by negotiation between representatives of the parties hereto who have authority to settle such Dispute. All such negotiations shall be confidential and any statements or offers made therein shall be treated as compromise and settlement negotiations for purposes of any applicable rules of evidence and shall not be admissible as evidence in any subsequent proceeding for any purpose. The statute of limitations applicable to the commencement of a lawsuit shall apply to the commencement of an arbitration hereunder, except that no defense based on the running of the statute of limitations will be available based upon the passage of time during any such negotiation. Regardless of the foregoing, a party shall have the right to seek immediate injunctive relief pursuant to Section 7.08(c) below without regard to any such 10-day negotiation period.

(b) Any Dispute (including the determination of the scope or applicability of this agreement to arbitrate) that is not resolved pursuant to Section 7.08(a) above shall be submitted to final and binding arbitration in New York before one neutral and impartial arbitrator, in accordance with the Laws of the State of New York for agreements made in and to be performed in that State. The arbitration shall be administered by JAMS pursuant to its Comprehensive Arbitration Rules and Procedures. Within fifteen (15) days following a demand for arbitration, the arbitrator shall be appointed by JAMS in accordance with its Comprehensive Arbitration Rules and Procedures, as in effect on the date hereof. The arbitrator shall designate the place and time of the hearing. The hearing shall be scheduled to begin as soon as practicable and no later than sixty (60) days after the appointment of the arbitrator (unless such period is extended by the arbitrator for good cause shown) and shall be conducted as expeditiously as possible. The award, which shall set forth the arbitrator’s findings of fact and conclusions of law, shall be filed with JAMS and mailed to the parties no later than thirty (30) days after the close of the arbitration hearing. The arbitration award shall be final and binding on the parties and not subject to collateral attack. Judgment upon the arbitration award may be entered in any federal or state court having jurisdiction thereof.

(c) Notwithstanding the parties’ agreement to submit all Disputes to final and binding arbitration before JAMS, the parties shall have the right to seek and obtain temporary or preliminary injunctive relief in any court having jurisdiction thereof. Such courts shall have authority to, among other things, grant temporary or provisional injunctive relief in order to protect any party’s rights under the Transaction Agreements. Without prejudice to such provisional remedies as may be available under the jurisdiction of a court, the arbitral tribunal shall have full authority to grant provisional remedies and to direct the parties to request that any court modify or vacate any temporary or preliminary relief issued by such court, and to award damages for the failure of any party to respect the arbitral tribunal’s orders to that effect.

(d) The prevailing party shall be entitled to recover its costs and reasonable attorneys’ fees, and the non-prevailing party shall pay all expenses and fees of JAMS, all costs of the stenographic record, all expenses of witnesses or proofs that may have been produced at the direction of the arbitrator, and the fees, costs, and expenses of the arbitrator. The arbitrator shall allocate such costs and designate the prevailing party or parties for these purposes.

Section 7.09 Severability. Each provision of the Transaction Agreements will be interpreted so as to be effective and valid under applicable Laws, but if any provision is held invalid, illegal or unenforceable under applicable Laws in any jurisdiction, then such invalidity, illegality or unenforceability will not affect any other provision, and the Transaction Agreements, as applicable, will be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been included herein.

Section 7.10 Rules of Construction.

(a) The parties hereto agree that they have been represented by counsel during the negotiation, preparation and execution of the Transaction Agreements and, therefore, waive the application of any Law, regulation, holding or rule of construction providing that ambiguities in an agreement or other document will be construed against the party drafting such agreement or document.

(b) The words “hereof,” “herein” and “herewith” and words of similar import shall, unless otherwise stated, be construed to refer to the Transaction Agreements as a whole and not to any particular provision of the Transaction Agreements, and article, section, paragraph, exhibit and schedule references are to the articles, sections, paragraphs, exhibits and schedules of the Transaction Agreements unless otherwise specified. Whenever the words “include,” “includes” or “including” are used in the Transaction Agreements, they shall be deemed to be followed by the words “without limitation.” All terms defined in the Transaction Agreements shall have the defined meanings contained herein when used in any certificate or other document made or delivered pursuant hereto unless otherwise defined therein. The definitions contained in the Transaction Agreements are applicable to the singular as well as the plural forms of such terms and to the masculine as well as to the feminine and neuter genders of such terms. Unless explicitly stated otherwise herein, any agreement, instrument or statute defined or referred to herein or in any agreement or instrument that is referred to herein means

such agreement, instrument or statute as from time to time, amended, qualified or supplemented, including in the case of agreements and instruments) by waiver or consent and (in the case of statutes) by succession of comparable successor statutes and all attachments thereto and instruments incorporated therein. References to a Person are also to its permitted successors and assigns.

Section 7.11 Equitable Remedies. The parties agree that irreparable damage would occur to the Company, on the one hand, and the Contributor and the Stockholder, on the other hand, in the event that any of the provisions of the Transaction Agreements were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the Company, on the one hand, and the Contributor and the Stockholder, on the other hand, shall be entitled to an injunction or injunctions to prevent breaches of the Transaction Agreements by the other party and to enforce specifically the terms and provisions hereof in any federal or state court located in New York, this being in addition to any other remedy to which the parties entitled under the Transaction Agreements or otherwise at law or in equity.

Section 7.12 Time of the Essence. Time is of the essence with respect to all obligations under the Transaction Agreements.

Section 7.13 Descriptive Headings. The descriptive headings herein are inserted for convenience only and are not intended to be part of or to affect the meaning or interpretation of the Transaction Agreements.

Section 7.14 No Personal Liability Conferred. The Transaction Agreements shall not create or permit any personal liability or obligation on the part of any officer, director, partner, employee or shareholder of the Company, the Contributor or the Stockholder.

Section 7.15 Amendments. This Contribution Agreement may be amended by appropriate instrument, without the consent of the Contributor and the Stockholder, at any time prior to the Contribution Closing Date; provided, that no such amendment, modification or supplement shall be made that alters the amount or changes the form of the consideration to be delivered to the Contributor or the Stockholder.

[Signature pages follow]

IN WITNESS WHEREOF, the parties hereto have caused this Contribution Agreement to be signed by their respective duly authorized officers or representatives, all as of the date first written above.


PARAMOUNT GROUP, INC., a Maryland corporation

	By:	/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
		Name:	▇▇▇▇▇ ▇. ▇▇▇▇▇▇
		Title:	Senior Vice President

ARCADE RENTAL INVESTMENTS, INC.

	By:	/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
		Name:	▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
		Title:	President

[Signature Page to Arcade Contribution Agreement]


STOCKHOLDER:

AROSA Vermoegensverwaltungsgesellschaft m.b.H., a German limited liability company

By:		▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇, individuals
Its:		Managing Directors

/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇

/s/ ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇

[Signature Page to Arcade Contribution Agreement]

EXHIBIT A

List of Properties

[See attached]

A-1

List of Properties

Fund I

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▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇

Fund III

▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇

▇▇ ▇▇▇▇ ▇▇^▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇

▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇

▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇

Fund IV

Liberty Place, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇

▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇

▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇

▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇

▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇

Fund IV Cayman

Liberty Place, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇

▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇

▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇

▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇

▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇

Fund V (CORE)

▇▇ ▇▇▇▇ ▇▇^▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇

1301 Avenue of the Americas, New York, NY

▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇

Liberty Place, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇

Fund V (CIP)

▇▇ ▇▇▇▇ ▇▇^▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇

1301 Avenue of the Americas, New York, NY

▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇

Liberty Place, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇

Fund V Cayman

▇▇ ▇▇▇▇ ▇▇^▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇

1301 Avenue of the Americas, New York, NY

▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇

Liberty Place, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇

Cosmos Rental Investments, Inc.

▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇

Arcade Rental Investments, Inc.

▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇

Arcade Rental Investments 2, Inc.

▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇

Marathon Rental Investments, Inc.

▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇

Forum Rental Investments, Inc.

▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇

Imperial Rental Investments, Inc.

▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇

▇▇▇▇▇▇ Rental Investments, Inc.

▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇

Paramount Group, Inc., a Delaware corporation

Waterview, Rosslyn, VA

▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇

1325 Avenue of the Americas, New York, NY

EXHIBIT B

Certificate of Conversion

[See attached]

B-1

STATE OF DELAWARE CERTIFICATE OF CONVERSION FROM A

CORPORATION TO A LIMITED LIABILITY COMPANY PURSUANT TO SECTION

18-214 OF THE LIMITED LIABILITY COMPANY ACT

The jurisdiction where the Corporation first formed is Delaware.

The jurisdiction immediately prior to filing this Certificate is Delaware.

The date the corporation first formed is December 29, 1977.

The name of the Corporation immediately prior to filing this Certificate is Arcade Rental Investments, Inc.

The name of the Limited Liability Company as set forth in the Certificate of Formation is Arcade Rental Investments LLC.

All membership interests will carry the same voting and economic rights by overall percentage held without the prior distinctions by class of the predecessor corporation, and without carrying over corporate concepts of number of authorized shares and par value.

IN WITNESS WHEREOF, the undersigned have executed this Certificate on this day of , 2014.


By:
Name:		▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
		President

EXHIBIT C

Certificate of Formation

[See attached]

C-1

CERTIFICATE OF FORMATION

ARCADE RENTAL INVESTMENTS LLC

This Certificate of Formation of Arcade Rental Investments LLC is being duly executed and filed by the undersigned, as an authorized person, to form a limited liability company under the Delaware Limited Liability Company Act (6 Del C. § 18-101, et seq.).

The name of the limited liability company is Arcade Rental Investments LLC.

The address of its registered office in the State of Delaware is ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇. The name of its Registered Agent is The Corporation Trust Company.

IN WITNESS WHEREOF, the undersigned has signed this Certificate of Formation of Arcade Rental Investments LLC this day of , 2014.


By:
Name:

EXHIBIT D

Agreement and Plan of Merger

[See attached]

D-1

EXHIBIT D

AGREEMENT AND PLAN OF MERGER

by and among

ARCADE RENTAL INVESTMENTS LLC

PARAMOUNT GROUP, INC.,

a Maryland corporation,

and

THE EQUITY HOLDER

ARCADE RENTAL INVESTMENTS LLC

Dated as of November [ ], 2014

TABLE OF CONTENTS


		Page

ARTICLE I THE MERGER			2

Section 1.01	The Merger		2
Section 1.02	Merger Closing		2
Section 1.03	Effective Time		2
Section 1.04	Effect of the Merger		2
Section 1.05	Organizational Documents		2
Section 1.06	Directors and Officers of the Surviving Entity		2
Section 1.07	Conversion of Equity Interests		3
Section 1.08	Tax Treatment		3
Section 1.09	Payment of Merger Consideration		3

ARTICLE II CLOSING			4

Section 2.01	Conditions Precedent		4

ARTICLE III COVENANTS; ADDITIONAL AGREEMENTS			6

Section 3.01	Tax Covenants		6
Section 3.02	Liability For Transfer Taxes		6
Section 3.03	Indemnification		7

ARTICLE IV GENERAL PROVISIONS			7

Section 4.01	General Provisions		7
Section 4.02	Amendments		7
Section 4.03	Counterparts		7

SCHEDULES

Schedule 1.07	Merger Consideration

Exhibit A	Form of Letter of Transmittal

AGREEMENT AND PLAN OF MERGER

THIS AGREEMENT AND PLAN OF MERGER (including all exhibits and schedules, this “Merger Agreement”) is made and entered into as of November 6, 2014, by and among PARAMOUNT GROUP, INC., a Maryland corporation (the “Company”), ARCADE RENTAL INVESTMENTS LLC, a Delaware limited liability company (“Arcade LLC”), and the equity holder whose name appears on the signature pages hereto (the “Equity Holder”). Defined terms used herein and not defined in the body of this Merger Agreement shall have the meanings set forth in the Contribution Agreement (as defined below).

RECITALS

WHEREAS, reference is made to that certain Contribution Agreement, dated as of November [ ], 2014 (the “Contribution Agreement”), by and among the Company, Arcade Rental Investments, Inc., a Delaware corporation (“Arcade”), and the sole stockholder of Arcade (the “Stockholder”) pursuant to which, among other matters, the parties thereto will effect the Contribution;

WHEREAS, the board of directors of Arcade and the Stockholder have approved, subject to, and following the closing of the Contribution, the conversion of Arcade from a Delaware corporation to a Delaware limited liability company named Arcade Rental Investments LLC (the “Conversion”), which will be the successor of Arcade;

WHEREAS, as part of the Formation Transactions, following the Conversion, Arcade LLC will merge with and into the Company, with the Company as the surviving entity (the “Merger”) and in consideration thereof the Equity Holder will receive shares of Company Common Stock (“Company Shares”);

WHEREAS, the board of directors of the Company and the stockholder of the Company have approved and authorized, subject to and following the closing of the Conversion, the Merger in accordance with applicable Laws and the Company’s Organizational Documents;

WHEREAS, Arcade LLC and the Equity Holder have approved and authorized, subject to and following the closing of the Conversion, the Merger in accordance with applicable Laws and Arcade LLC’s Organizational Documents; and

WHEREAS, the Conversion became effective as of the date hereof upon the filing of the Certificate of Conversion and the Certificate of Formation.

NOW, THEREFORE, in consideration of the foregoing and the representations, warranties, covenants and other terms contained in this Merger Agreement, the receipt and sufficiency of which is hereby acknowledged and agreed, the parties hereto, intending to be legally bound hereby, agree as follows:

ARTICLE I

THE MERGER

Section 1.01 The Merger. At the Effective Time, subject to and upon the terms and conditions of this Merger Agreement and in accordance with applicable Laws, Arcade LLC shall be merged with and into the Company, whereby the separate existence of Arcade LLC shall cease, and the Company shall continue its existence under Maryland General Corporation Law as the surviving entity in the Merger (sometimes referred to as the “Surviving Entity”).

Section 1.02 Merger Closing. The closing of the Merger and the other transactions contemplated hereby (the “Merger Closing” or the “Merger Closing Date”) shall occur after the Conversion and concurrently with the closing of the IPO (the “IPO Closing”), or up to one (1) day prior to, but conditioned upon the prior occurrence of the Conversion and subsequent occurrence of, the IPO Closing. The Merger Closing shall take place at the offices of ▇▇▇▇▇▇▇ Procter LLP, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, or as mutually agreed between the Company and Arcade LLC. In connection with the foregoing, the parties hereto hereby agree that the specific order in which the Contribution, the Merger Closing, the IPO Closing and the closing of the other transactions that are part of or related to the Formation Transactions occur shall be as determined by the Company provided, however, that the Contribution shall precede the Conversion and the Conversion shall precede the Merger Closing.

Section 1.03 Effective Time. On the Merger Closing Date (or on such other date as the Company and Arcade LLC may agree) the Company and Arcade LLC shall file, or shall cause to be filed, a certificate of merger or similar document with respect to the Merger (the “Certificate of Merger”) as may be required by applicable Laws with the Secretary of State of each applicable jurisdiction, providing that the Merger shall become effective upon filing or, if agreed upon by the Company and Arcade LLC, as of such other date or time as is set forth in the Certificate of Merger (the “Effective Time”), together with any certificates and other filings or recordings related thereto, in such forms as are required by, and executed in accordance with, the relevant provisions of applicable Laws.

Section 1.04 Effect of the Merger. At the Effective Time, the effect of the Merger shall be as provided in this Merger Agreement, the Certificate of Merger and applicable Laws.

Section 1.05 Organizational Documents. At the Effective Time, the Organizational Documents of the Company, as in effect immediately prior to the Effective Time, shall be the Organizational Documents of the Surviving Entity until thereafter amended as provided therein or in accordance with applicable Laws.

Section 1.06 Directors and Officers of the Surviving Entity. The directors and officers of the Company immediately prior to the Effective Time shall be and become the directors and officers of the Surviving Entity as of the Effective Time, each to hold office in accordance with the Organizational Documents of the Surviving Entity.

Section 1.07 Conversion of Equity Interests.

(a) Under and subject to the terms and conditions of this Merger Agreement, the Equity Holder is entitled to receive as a result of and upon consummation of the Merger, the Merger Consideration set forth under the heading “Arcade LLC” in Schedule 1.07.

(b) At the Effective Time, by virtue of the Merger and without any action on the part of the Company, Arcade LLC or the Equity Holder, each outstanding equity interest in Arcade LLC (each an “Equity Interest”) shall be converted automatically into the right of the Equity Holder to receive Company Shares, in the amount set forth opposite its name under the heading “Arcade LLC” in Schedule 1.07 (the “Merger Consideration”).

(c) No fractional Company Shares shall be issued to the Equity Holder pursuant to this Merger Agreement. If aggregating all Company Shares that the Equity Holder otherwise would be entitled to receive as a result of the Merger would require the issuance of a fractional Company Share, the Equity Holder shall instead be entitled to receive one full Company Share in lieu of such fractional Company Share.

(d) From and after the Effective Time, each Equity Interest converted into the right to receive the Merger Consideration pursuant to Section 1.07(b) shall no longer be outstanding and shall automatically be cancelled and retired and shall cease to exist, and the holder of such Equity Interest so converted shall thereafter cease to have any rights as an equity holder, except the right to receive the Merger Consideration applicable thereto.

Section 1.08 Tax Treatment. It is intended that, for U.S. federal income tax purposes, that the Contribution, Conversion and Merger shall, taken together, qualify as a “reorganization” within the meaning of Section 368(a) of the Code, and that this Merger Agreement and the Contribution Agreement constitute, and hereby is adopted as, a “plan of reorganization” within the meaning of Treasury Regulations Sections 1.368-2(g) and 1.368-3.

Section 1.09 Payment of Merger Consideration.

(a) After the Effective Time, upon surrender by the Equity Holder of its Equity Interests together with a duly executed letter of transmittal in the form attached hereto as Exhibit A and the certificates, if any, evidencing such Equity Interests to the Company, the Equity Holder shall be entitled to receive from the Company in exchange therefor the Merger Consideration to which the Equity Holder is entitled (less the Indemnity Holdback Amount). Risk of loss and title to the Equity Interests of the Equity Holder shall pass only upon delivery to the Company of such duly executed letter of transmittal and the certificates, if any, evidencing such Equity Interests. The full amount of the Indemnity Holdback Amount shall be retained from the Merger Consideration otherwise deliverable to the Equity Holder.

(b) Notwithstanding any other provisions of this Merger Agreement, dividends or other distributions payable on any portion of the Merger Consideration after the Effective Time, but prior to the delivery of such portion of the Merger Consideration to the Equity Holder pursuant to Section 1.09(a) above, shall be paid promptly by the Company to the Equity Holder of record, as set forth in Schedule 1.07(b), entitled to receive such portion of the Merger Consideration upon compliance with the procedures set forth in this Section, less the

amount of any withholding taxes which may be required thereon as reasonably determined by the Company. At and after the Effective Time, there shall be no transfers on the applicable record books of the Equity Interests that are outstanding immediately prior to the Effective Time.

(c) On the Merger Closing Date, the Company will deposit the Indemnity Holdback Amount with the Escrow Agent (as defined in the Escrow Agreement) in accordance with the terms and conditions of the Escrow Agreement. The approval of the Merger and this Merger Agreement by the Equity Holder shall constitute approval of the Escrow Agreement and of all of the arrangements relating thereto, including without limitation the placement of the Indemnity Holdback Amount in escrow and the appointment of the Equity Holder’s Representative pursuant to the Contribution Agreement.

ARTICLE II

CLOSING

Section 2.01 Conditions Precedent.

(a) Condition to Each Party’s Obligations. The respective obligation of each party to effect the transactions contemplated by this Merger Agreement to occur on the Merger Closing Date is subject to the satisfaction or waiver on or prior to the Merger Closing of the following conditions:

(i) Consent. The requisite consent of the Equity Holder approving the Merger shall have been obtained. This condition may not be waived by any party.

(ii) Contribution. The Contribution shall have been completed. This condition may not be waived by any party.

(iii) Conversion. The Conversion shall have been completed. This condition may not be waived by any party.

(iv) IPO Proceeds. The Company shall have received substantially currently with the Merger Closing hereunder the proceeds from the IPO. This condition may not be waived by any party.

(v) No Injunction. No Governmental Authority shall have enacted, issued, promulgated, enforced or entered any statute, rule, regulation, executive order, decree, judgment, injunction or other order (whether temporary, preliminary or permanent), in any case which is in effect and which prevents or prohibits consummation of any of the transactions contemplated in this Merger Agreement nor shall any of the same brought by a Governmental Authority of competent jurisdiction be pending that seeks the foregoing.

(b) Conditions to Obligations of the Company. The obligation of the Company to effect the transactions contemplated by this Merger Agreement and to consummate the other transactions contemplated hereby to occur on the Merger Closing Date are further subject to satisfaction of the following conditions (any of which may be waived by the Company in whole or in part):

(i) Representations and Warranties of the Contributor. (i) The representations and warranties of the Contributor set forth in Section 4.16 of the Contribution Agreement shall be true and correct in all respects as of the date of this Merger Agreement and as of the Effective Time, (ii) each representation and warranty of the Contributor in the Contribution Agreement (other than in Section 4.16) that is qualified by materiality or Contributor Material Adverse Effect shall be true and correct in all respects as of the date of this Merger Agreement and as of the Effective Time as if made again at that time (except to the extent that any representation or warranty speaks as of an earlier date, in which case it must be true and correct only as of that earlier date), and (iii) each representation and warranty of the Contributor contained in the Contribution Agreement (other than in Section 4.16) that is not qualified by materiality or Contributor Material Adverse Effect shall be true and correct as of the date of this Merger Agreement and as of the Merger Closing as if made again at that time (except to the extent that any representation or warranty speaks as of an earlier date, in which case it must be true and correct only as of that earlier date), except where the failure of such representations and warranties to be true and correct would not reasonably be expected to have a Contributor Material Adverse Effect.

(ii) Consents, Etc. All necessary consents and approvals of Governmental Authorities or third parties (including lenders) for Arcade LLC to consummate the transactions contemplated hereby (except for those the absence of which would not have a material adverse effect on the ability of Arcade LLC to consummate the transactions contemplated by this Merger Agreement) shall have been obtained.

(iii) Operating Company Agreement. Arcade LLC shall have executed and delivered to the Company the operating company agreement of Arcade LLC.

(c) Conditions to Obligations of Arcade LLC. The obligation of Arcade LLC to effect the transactions contemplated by this Merger Agreement and to consummate the other transactions contemplated hereby to occur on the Merger Closing Date are further subject to satisfaction of the following conditions (any of which may be waived by Arcade LLC in whole or in part):

(i) Representations and Warranties. (i) Each representation and warranty of the Company contained in the Contribution Agreement that is qualified by materiality or Company Material Adverse Effect shall be true and correct in all respects as of the date of the Contribution Agreement and as of the Effective Time as if made again at that time (except to the extent that any representation or warranty speaks as of an earlier date, in which case it must be true and correct only as of that earlier date), and (ii) each representation and warranty of the Company contained in the Contribution Agreement that is not qualified by materiality or Company Material Adverse Effect shall be true and correct as of the date of the Contribution Agreement and as of the Effective Time as if made again at that time (except to the extent that any representation or warranty speaks as of an earlier date, in which case it must be true and correct only as of

that earlier date), except where the failure of such representations and warranties to be true and correct would not reasonably be expected to have a Company Material Adverse Effect.

(ii) Consents, Etc. All necessary consents and approvals of Governmental Authorities or third parties (including lenders) for the Company to consummate the transactions contemplated hereby (except for those the absence of which would not have a material adverse effect on the ability of the Company to consummate the transactions contemplated by this Merger Agreement) shall have been obtained.

ARTICLE III

COVENANTS; ADDITIONAL AGREEMENTS

Section 3.01 Tax Covenants.

(a) Each party hereto (i) shall cause all Tax returns relating to the Contribution, Conversion and Merger to be filed on the basis of treating the Contribution, Conversion and Merger, taken together, as a “reorganization” within the meaning of Section 368(a) of the Code and (ii) shall not take any position on any Tax return, or take any other reporting position, that is inconsistent with such treatment, unless otherwise required by applicable Laws.

(b) The Equity Holder shall provide the Company with such reasonable cooperation and information relating to Arcade LLC, any Arcade LLC Subsidiary and any JV Entity as the Company reasonably requires in (i) filing any Tax return, amended Tax return or claim for Tax refund, (ii) determining any liability for Taxes or a right to a Tax refund, (iii) conducting or defending any proceeding in respect of Taxes or (iv) performing Tax diligence, including with respect to the impact of the transactions contemplated herein on the Company’s qualification as a REIT for U.S. federal income Tax purposes.

(c) The Company shall be responsible for the prosecution of any claim or audit instituted after the Merger Closing Date with respect to Taxes of Arcade LLC, any Arcade LLC Subsidiary or any JV Entity attributable to any taxable period, or portion thereof, ending on or before the Merger Closing Date.

Section 3.02 Liability For Transfer Taxes. Without duplication of the indemnity set forth in Section 6.05 of the Contribution Agreement, the Equity Holder agrees to indemnify the Company for any Incremental Transfer Taxes incurred as a result of any direct or indirect transfers of the Company Shares or interests therein within two years after the IPO Closing Date; provided that such Company Shares shall be the Company’s sole recourse with respect to such indemnification obligation. Without duplication of the indemnity set forth in Section 6.05 of the Contribution Agreement, the Equity Holder hereby grants a security interest in 50% of the Company Shares received as Merger Consideration to the Company and hereby irrevocably appoints the Company, and any of its agents, officers, or employees as its attorney-in fact, which shall be deemed coupled with an interest, with full power to prepare, execute and deliver any documents, instruments and agreements as may be appropriate to perfect and continue such

security interest in favor of the Company. The security interest granted pursuant to this Section 3.02 shall attach to the Company Shares that are not included in the Indemnity Holdback Amount. The Company agrees that the security interest in the Company Shares received by the Equity Holder in the Merger may be released, or collateral may be substituted, in accordance with the terms of the Escrow Agreement.

Section 3.03 Indemnification. The parties agree that the provisions of Article V (Indemnification) and Section 6.04 of Article VI of the Contribution Agreement (Tax Protection Provisions) shall apply mutatis mutandis to this Merger Agreement.

ARTICLE IV

GENERAL PROVISIONS

Section 4.01 General Provisions. The provisions of Article VII (General Provisions) of the Contribution Agreement shall apply mutatis mutandis to this Merger Agreement.

Section 4.02 Amendments. This Merger Agreement may be amended by appropriate instrument, without the consent of the Contributor and the Equity Holder, at any time prior to the Merger Closing Date; provided, that no such amendment, modification or supplement shall be made that alters the amount or changes the form of the Merger Consideration to be delivered to the Equity Holder.

Section 4.03 Counterparts. This Merger Agreement may be executed in counterparts, all of which shall be considered one and the same agreement and shall become effective when one or more counterparts have been signed by each party and delivered to each other party. All counterparts shall collectively constitute one agreement (or amendment, as applicable). The exchange of counterparts of this Merger Agreement among the parties by means of facsimile transmission or by electronic transmission (pdf) which shall contain authentic reproductions shall constitute a valid exchange of this Merger Agreement and shall be binding upon the parties hereto.

[Signature pages follow]

IN WITNESS WHEREOF, the parties hereto have caused this Merger Agreement to be signed by their respective duly authorized officers or representatives, all as of the date first written above.


PARAMOUNT GROUP, INC.,
a Maryland corporation

By:
Name:
Title:

ARCADE RENTAL INVESTMENTS LLC, a Delaware limited liability company

By:		Paramount Group, Inc., a Delaware corporation, its manager

By:
Name:
Title:

[Signature Page to Arcade Merger Agreement]


STOCKHOLDER:

AROSA Vermoegensverwaltungsgesellschaft m.b.H., a German limited liability company

By:		▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇, individuals
Its:		Managing Directors



Name:

[Signature Page to Arcade Merger Agreement]

EXHIBIT A

Form of Letter of Transmittal

[See attached]

Exhibit A

SCHEDULE 1.07

Merger Consideration

Arcade LLC

Equity Holder

Merger Consideration

Indemnity

Holdback Amount

AROSA

489,289 Company Shares

7,339 Company Shares

Schedule 1.07

EXHIBIT E

Escrow Agreement

[See attached]

E-1

OMNIBUS DISTRIBUTION AND ESCROW AGENT AGREEMENT

This OMNIBUS DISTRIBUTION AND ESCROW AGENT AGREEMENT (as the same may be amended or modified from time to time pursuant hereto, this “Agreement”) is made and entered into as of November , 2014 by and among the ENTITIES SET FORTH ON SCHEDULE 1 (collectively, the “Participants” and individually, each a “Participant”), PARAMOUNT GROUP, INC., a Maryland corporation (the “Company”), and PARAMOUNT GROUP OPERATING PARTNERSHIP LP, a Delaware limited partnership (the “Operating Partnership” and collectively with the Company and any designees of either of the Company or the Operating Partnership, the “PGI Parties” and individually, each a “PGI Party”).

BACKGROUND

The Company, which is the sole general partner of the Operating Partnership, desires to consolidate the ownership of a portfolio of primarily office properties currently owned, directly or indirectly, by the Participants (collectively, the “Formation Transactions”).

The Formation Transactions relate to the proposed initial public offering (the “IPO”) of the common stock, par value $.01 per share (“REIT Shares”), of the Company, which will operate as a self-administered and self-managed real estate investment trust within the meaning of Sections 856 through 858 of the Code.

In connection with the Formation Transactions, (i) the Company will issue REIT Shares to certain Participants and/or the Holders (as defined below) of the JV Participants (as defined below) and (ii) the Operating Partnership will issue units of limited partnership interest (“OP Units”) to certain other Participants, in each case pursuant to a private placement.

Each Participant has entered into a contribution agreement, merger agreement or other similar agreement or agreements (the “Formation Transaction Documentation”) with one or more of the PGI Parties pursuant to which each such Participant has agreed to contribute to, or merge into, the PGI Parties, as applicable, all of such Participant’s interests identified in such Formation Transaction Documentation. As used herein, the term Formation Transaction Documentation shall include all agreements or other documentation entered into in connection with the Formation Transaction Documentation including, without limitation, the lock-up agreements entered into with the underwriters of the IPO.

The Formation Transaction Documentation provides for the appointment of a distribution and escrow agent in connection with the IPO Escrow and Indemnity Holdback Escrow (each defined below).

Computershare Inc., together with its subsidiary, Computershare Trust Company, N.A., has agreed to act as the distribution and escrow agent (collectively, the “Agent”)

Concurrently with the execution of the Formation Transaction Documentation, (i) the Participants and the PGI Parties have entered into this Agreement, and (ii) the PGI Parties and the Agent have entered into the Transfer Agency and Service Agreement (the “TA Agreement”), the Tabulation Agent Agreement (the “Tabulation Agreement”) and the Escrow Agreement (the “Escrow Agreement”) (each attached as an exhibit hereto and collectively referred to herein as the “Agent Agreements”), pursuant to which the following has or will occur:

•

IPO Escrow. As of the date of this Agreement, certain of the Participants (the “Fund Participants” identified on Schedule 1) have distributed in book entry form to each of their partners (together with equity owners of the other Participants, the “Holders”) as set forth opposite such Holders’ name on Schedule 2, in escrow pursuant to the Agent Agreements, a right (the “Distribution Rights”) to receive such Holder’s allocable share of the number of OP Units and/or REIT Shares (subject to certain restrictions, obligations and liens as described in Section 3 below) to be issued to such Fund Participants (as well as to the other Participants) in connection with the closing of the IPO (the “IPO Consideration”). Pursuant to the Agent Agreements, in connection with the closing of the IPO (the “Effective Date”), Agent will be deemed to have submitted to the Company and the Operating Partnership, as applicable, the Distribution Rights in exchange for the IPO Consideration as set forth opposite each Holders’ name on Schedule 2 and Agent will hold the IPO Consideration in escrow. In addition, pursuant to its applicable Formation Transaction Documentation, the Company will also on the Effective Date issue IPO Consideration to the Holders of the Participants identified on Schedule 1 as the PGI Participants (the “PGI Participants”). Furthermore, pursuant to its applicable merger agreement (the “JV Merger Agreement”) pursuant to which the JV Participants (as defined below below) will merge with and into the Company or a newly-formed subsidiary of the Company (the “JV Merger”), the Company will also on the Effective Date issue IPO Consideration to the Holders of the Participants identified on Schedule 1 as the JV Participants (the “JV Participants”) in accordance with the Letter of Transmittal (defined below). The escrow arrangements with respect to the Distribution Rights and IPO Consideration are collectively referred to as the “IPO Escrow”.

•

Indemnity Holdback Escrow. At the Effective Date, each Participant will cause its respective Holders to deposit (and the Company will withhold from the Holders of the JV Participants and cause to be deposited) in escrow with Agent (the “Indemnity Holdback Escrow”

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and together with the IPO Escrow, the “Escrow Accounts”) a portion of such Holders’ respective IPO Consideration as set forth opposite such Holder’s name on Schedule 2 (the “Indemnity Holdback Amount”) in order to provide for the indemnification obligations provided for in the applicable Formation Transaction Documentation.

NOW, THEREFORE, in consideration of the foregoing and the representations, warranties, covenants and other terms contained in this Agreement, the parties hereto, intending to be legally bound hereby, agree as follows:

1. Appointment. The parties hereby agree to the appointment of Agent, pursuant to each of the applicable definitive Agent Agreements, to serve as distribution and escrow agent in connection with the holding and disbursement of the Distribution Rights, IPO Consideration and Indemnity Holdback Amount, in each case pursuant to and in accordance with the applicable definitive Agent Agreement. Subject to entering into such definitive Agent Agreements, Agent has agreed to accept such appointment pursuant to the terms and conditions set forth therein. Pursuant to the relevant portions of certain of the Agent Agreements, Agent will establish a separate account for each Holder in accordance with Schedule 2 and such accounts will allocate each Holder’s aggregate IPO Consideration to a class(es) corresponding to the Participant(s) with respect to which such Holder received its IPO Consideration.

2. Effective Date. The Company will promptly notify Agent of the Effective Date on the date thereof.

3. Escrow Procedures; Legending of IPO Consideration.

(a) IPO Escrow. The TA Agreement and Tabulation Agreement attached as Exhibit A and Exhibit B, respectively, set forth the procedures that the parties and Agent agree and acknowledge shall control with respect to the holding and disbursement of the Distribution Rights and IPO Consideration by Agent.

(b) Indemnity Holdback Escrow. The Escrow Agreement attached as Exhibit C sets forth the procedures that the parties agree and acknowledge shall control with respect to the holding and disbursement of the Indemnity Holdback Amount by Agent.

(c) Legending. Pursuant and subject to the TA Agreement, Agent will cause the IPO Consideration to be legended to reflect the following lock-ups and restrictions, which lock-ups and restrictions are more particularly described in and governed by the Formation Transaction Documentation (the “Restrictive Legends”):

(i) Lock-up on Transfers: All OP Units and REIT Shares shall be subject to lock-up on transfers until 180 days after the Effective Date.

(ii) IPO Escrow: All OP Units and REIT Shares shall be subject to the IPO Escrow until the earlier of (i) the delivery of, as applicable, a completed and signed Investor Acknowledgement Agreement (substantially in the form attached hereto as Exhibit D-1 and D-2) or Letter of Transmittal (substantially in the form attached hereto as Exhibit E) or (ii) one business day after the second anniversary of the Effective Date. The PGI Parties acknowledge that

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the Letter of Transmittal from the Holders of the JV Participants is required to be delivered to the Company and/or the Agent as of the closing of the JV Merger and the concurrent closing of the IPO pursuant to the JV Merger Agreement and if so delivered, the Restrictive Legend with respect to the IPO Escrow will not be placed on the REIT Shares to be issued to the JV Participants.

(iii) Indemnity Holdback Escrow: Those OP Units and REIT Shares identified on Schedule 2 under the heading “Indemnity Holdback Escrow” shall be held by Agent subject to (i) the Indemnity Holdback Escrow and (ii) other than with respect to the Holders of the JV Participants and WvF Real Estate Fund, L.P. as a Holder of Paramount Group Real Estate Fund V (Core), L.P., a pledge of such OP Units and REIT Shares in favor of the applicable PGI Party until the earlier of (x) the first anniversary of the Effective Date unless there is a Reserved Portion (as defined in the Escrow Agreement) as of such date, in which event, the Indemnity Escrow Holdback shall continue with respect to such Reserved Portion until ultimately disposed of in accordance with the Escrow Agreement and (y) the date a Holder posts with Agent Substitute Collateral (defined below) in accordance with the Escrow Agreement, in which event such Substitute Collateral shall be held in the Indemnity Holdback Escrow.

(iv) Transfer Tax Indemnity: Other than with respect to the Holders of the JV Participants, each Holder’s IPO Consideration shall be subject to the following: (i) indemnification obligations for any incremental New York City and State real property transfer taxes that will be payable if such Holder subsequently transfers more than 50% of its IPO Consideration within two years of the IPO Closing and (ii) a pledge with respect to such indemnification obligations of 50% of each Holder’s total IPO Consideration in favor of the applicable PGI Party until the earlier of (x) one business day after the second anniversary of the Effective Date and (y) the date a Holder posts with the applicable PGI Party Substitute Collateral in accordance with the TA Agreement.

(v) Prohibition on Redemption of OP Units: All OP Units shall be subject to a prohibition on redemption until 14 months after the Effective Date.

(vi) General. Pursuant and subject to the TA Agreement, the Agent will release the applicable portion of the IPO Consideration from the Restrictive Legends after the expiration of the periods set forth above or, if applicable, to the extent such IPO Consideration has been released from escrow or the applicable restriction by the posting of Substitute Collateral (as defined below).

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(d) Substitute Collateral. A Holder may have the OP Units and/or REIT Shares that are subject to the Indemnification Holdback Escrow and/or the Transfer Tax Indemnity released by Agent by posting either (i) cash collateral or (ii) a letter of credit in form and substance acceptable to the applicable PGI Party (“Substitute Collateral”).

(i) Any Substitute Collateral posted with respect to the Indemnification Holdback Escrow shall be (i) posted with Agent pursuant to the Escrow Agreement; (ii) be in an amount equal to all or a portion of the IPO Consideration such Holder seeks to have released from escrow and (iii) the number of REIT Shares and/or OP Units that shall be released shall be equal to (x) the amount of the Substitute Collateral posted divided by (y) the Value of a REIT Share on the date Agent receives the Substitute Collateral, rounded up to the nearest whole number.

(ii) Any Substitute Collateral posted with respect to the transfer tax indemnity shall be (i) posted with the applicable PGI Party; and (ii) in an amount equal to 100% of the Holder’s share of the indemnification obligations for transfer tax payment that would be payable upon the transfer of such Holder’s REIT Shares and/or OP Units prior to the expiration of the applicable transfer tax indemnity period as reasonably determined by such PGI Party; and after the posting of such Substitute Collateral, all of such Holder’s REIT Shares and/or OP Units shall be released by Agent from the applicable Restrictive Legend.

(iii) “Value” means with respect to a REIT Share on a particular date, the market price of a REIT Share on such date. The market price for each such trading day shall be: (i) if the REIT Shares are listed or admitted to trading on any national securities exchange, the closing price on such day as reported by such national securities exchange, or if no such sale takes place on such day, the average of the closing bid and asked prices on such day; (ii) if the REIT Shares are not listed or admitted to trading on any national securities exchange, the last reported sale price on such day or, if no sale takes place on such day, the average of the closing bid and asked prices on such day, as reported by a reliable quotation source designated by the Company; (iii) if the REIT Shares are not listed or admitted to trading on any national securities exchange and no such last reported sale price or closing bid and asked prices are available, the average of the reported high bid and low asked prices on such day, as reported by a reliable quotation source designated by the Company, or if there shall be no bid and asked prices on such day, the average of the high bid and low asked prices, as so reported, on the most recent day (not more than ten (10) days prior to the date in question) for which prices have been so reported; or (iv) if none of the conditions set forth in clauses (i), (ii), or (iii) is met then, the amount determined by the board of directors of the Company.

4. Dividends And Distributions On IPO Consideration Held in Escrow Accounts or Subject to Restrictive Legends. Pursuant to the TA Agreement, Agent shall pay to the respective Holders shown on Schedule 2 any dividends or other distributions that are declared on the OP Units and REIT Shares after the Effective Date as if not encumbered by the Escrow Account or the Restrictive Legends notwithstanding that any portion of the IPO Consideration is being held in an Escrow Account or subject to any Restrictive Legends.

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5. Voting. Each Holder shall have the right to vote the REIT Shares and OP Units credited to such Holder’s account as if not encumbered by the Escrow Account or the Restrictive Legends notwithstanding that any portion of the IPO Consideration is being held in an Escrow Account or subject to any Restrictive Legends. Pursuant to the TA Agreement, Agent will promptly forward to each Holder all notices of shareholders’ or partners’ meetings, proxy statements and reports received by Agent in respect of REIT Shares or OP Units held in such Holder’s account

6. Withholding; Other Tax Matters. The Participants, the Company and the Operating Partnership, as applicable, shall deduct and withhold any taxes they reasonably deem are appropriate under applicable tax withholding rules from any payment of IPO Consideration to the Holders. As of the Effective Date, for U.S. federal (and applicable state and local) income tax purposes, each Holder shall be treated as the owner of the IPO Consideration to which they are, or will be, entitled pursuant to this Agreement (including, for the avoidance of doubt, any IPO Consideration held in the Escrow Accounts on such Holder’s behalf).

7. Notices. All communications hereunder shall be in writing or set forth in a PDF attached to an email, and shall be delivered in accordance with the terms of this Agreement by facsimile, email or overnight courier only to the appropriate fax number, email address, or notice address set forth in Schedule 3.

8. Authorized Representatives. The parties hereby acknowledge that the individuals set forth as authorized representatives (“Authorized Representatives”) on Schedule 4 have the authority to act as the representative(s) of each of the Participants and/or Holders, as applicable, in connection with any rights or obligations of such entities as signatories to, or third party beneficiaries under, the Escrow Agreement to the extent any such rights are expressly given to the Authorized Representatives in the Escrow Agreement.

9. Miscellaneous.

(a) Successors and Assigns. All the covenants and provisions of this Agreement by or for the benefit of the Participants, the PGI Parties or Agent shall bind and inure to the benefit of their respective successors and permitted assigns hereunder (or with respect to the Agent under the applicable Agent Agreement), but shall not be assignable by any party hereto without the written consent of all the parties hereto; provided, however, that the Agent may assign its rights hereunder subject to the provisions of the applicable Agent Agreement.

(b) Amendments. This Agreement and the Agent Agreements may only be amended or modified by a written amendment executed by the Agent and the Company; provided, however, that, if such amendment (i) does not affect each of the Participants or the Holders (and, if applicable, the PGI Parties) in the same manner, or (ii) decreases the rights or increases the obligations of the Participants or Holders or the restrictions on the IPO Consideration under this Agreement or the Agent Agreements, then such Participant(s) and/or Holder(s) shall also be required to consent to such amendment. Agent may rely on the Company’s signature to any amendment as evidence that any required consent from

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Participants and Holders has been obtained. Notification of all Amendments to this Agreement and the Agent Agreements shall be provided to each of the Holders and Participants.

(c) Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction or other authority to be invalid, void or unenforceable, the remainder of the terms, provision, covenants and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated.

(d) Governing Law; Jurisdiction. This Agreement shall be governed by the laws of the State of New York, without regard to principles of conflicts of law. The parties irrevocably (i) submit to the non-exclusive jurisdiction of any New York State court sitting in New York City, New York County or the United States District Court for the Southern District of New York in any action or proceeding arising out of or relating to this Agreement, (ii) waive, to the fullest extent they may effectively do so, any defense based on inconvenient forum, improper venue or lack of jurisdiction to the maintenance of any such action or proceeding, and (iii) waive all right to trial by jury in any action, proceeding or counterclaim arising out of this Agreement or the transactions contemplated hereby. Agent shall not be required hereunder to comply with the laws or regulations of any country other than the United States of America or any political subdivision thereof. Agent may consult with foreign counsel in connection with any foreign law issues that may arise as a result of the Company or any other party being subject to the laws or regulations of any foreign jurisdiction.

(e) Force Majeure. Notwithstanding anything to the contrary contained herein, Agent shall not be liable for any delays or failures in performance resulting from acts beyond its control including, without limitation, acts of God, terrorist acts, shortage of supply, loss of data due to power failures, war, or civil unrest.

(f) Third Party Beneficiaries. The provisions of this Agreement are intended to benefit only the Participants, the Holders and the PGI Parties and their respective permitted successors and assigns. No rights shall be granted to any other person by virtue of this Agreement, and there are no third party beneficiaries hereof.

(g) Survival. All provisions regarding indemnification, warranty, liability and limits thereon, compensation and expenses and confidentiality and protection of proprietary rights and trade secrets shall survive the termination or expiration of this Agreement.

(h) Priorities. In the event of any conflict, discrepancy, or ambiguity between the terms and conditions contained in (i) this Agreement, (ii) any schedules or attachments hereto, (iii) the Formation Transaction Documentation, and (iv) the Agent Agreements with respect to any obligations, rights, duties, responsibilities, liabilities, indemnities or protections of the Agent, the terms and conditions contained in the Agent Agreements shall take precedence.

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(i) Merger of Agreement. Together with the Formation Transaction Documentation and the Agent Agreements, this Agreement constitutes the entire agreement between the parties hereto and supersedes any prior agreement with respect to the subject matter hereof, whether oral or written.

(j) No Strict Construction. The parties hereto have participated jointly in the negotiation and drafting of this Agreement. In the event any ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by all parties hereto, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provision of this Agreement.

(k) Descriptive Headings. Descriptive headings contained in this Agreement are inserted for convenience only and shall not control or affect the meaning or construction of any of the provisions hereof.

(l) Counterparts. This Agreement may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument. A signature to this Agreement transmitted electronically shall have the same authority, effect, and enforceability as an original signature. For purposes of the signature pages, the reference to “Holders” should read “PGI Participants”.

[signature pages follow]

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date set forth above.

Company:


PARAMOUNT GROUP, INC., a Maryland corporation

		By:
		Name:
		Title:

Operating Partnership:


PARAMOUNT GROUP OPERATING PARTNERSHIP LP, a Delaware limited partnership

	By:	Paramount Group, Inc., its general partner, a Maryland corporation

		By:
		Name:
		Title:

Agent:

Acknowledged and Agreed to with respect to Section 1 only:


COMPUTERSHARE TRUST COMPANY, N.A. and COMPUTERSHARE INC. *On Behalf of Both Entities*

By:
Name:
Title:

Fund Participants:


PARAMOUNT GROUP REAL ESTATE FUND I, L.P.
	By:	Paramount GREF, L.L.C., its general partner
		By:	Paramount Group, Inc., its Managing Member

PARAMOUNT GROUP REAL ESTATE FUND III, L.P.
	By:	Paramount GREF III, L.L.C., its general partner
		By:	Paramount Group, Inc., its Managing Member

PARAMOUNT GROUP REAL ESTATE FUND IV, L.P.
	By:	Paramount GREF IV, L.L.C., its general partner
		By:	Paramount Group, Inc., its Managing Member

PGREF IV PARALLEL FUND SUB US, LP
	By:	PGREF IV Parallel Fund Sub US GP, LLC, its general partner
		By:	Paramount Group, Inc., its Manager

PARAMOUNT GROUP REAL ESTATE FUND V (CORE), L.P.
	By:	Paramount GREF V, L.L.C., its general partner
		By:	Paramount Group, Inc., its Managing Member

PARAMOUNT GROUP REAL ESTATE FUND V (CIP), L.P.
	By:	Paramount GREF V (CIP), L.L.C., its general partner
		By:	Paramount Group, Inc., its Managing Member

PGREF V (CORE) PARALLEL FUND SUB US, LP
	By:	PGREF V (Core) Parallel Fund Sub US GP, LLC, its general partner

		By:	Paramount Group, Inc., its Manager


		Signature:
		Name:
		Title:

PGI Participants:


PARAMOUNT GROUP, INC., a Delaware corporation

By:
Name:
Title:

PGI Participants:


ARCADE RENTAL INVESTMENTS, INC. ARCADE RENTAL INVESTMENTS 2, INC. COSMOS RENTAL INVESTMENTS, INC. MARATHON RENTAL INVESTMENTS, INC.

By:
Name:		▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title:		President of each of the above named corporations

PGI Participants:



Name:		▇▇▇▇▇ ▇▇▇▇

PGI Participants:



Name:		▇▇▇▇▇▇▇ ▇▇▇▇▇

PGI Participants:



Name:		▇▇▇▇▇ ▇▇▇▇▇▇

PGI Participants:



Name:		▇▇▇▇▇ ▇▇▇▇▇▇▇▇

JV Participants:

WvF 1325, INC., a Delaware corporation


Signature:
Name:
Title:

WvF 1325, L.P., a Delaware limited partnership


By:		WvF 1325, Inc., its general partner

Signature:
Name:
Title:

HOLDER:


Signature:
Name:		Dr. ▇▇▇▇▇▇▇ ▇▇▇▇

HOLDER:


Signature:
Name:		▇▇▇▇▇▇▇▇ ▇▇▇▇

HOLDER:


Signature:
Name:		▇▇▇▇▇▇ ▇▇▇▇

EXHIBIT F

Lock-up Agreement

[See attached]

F-1

FORM OF LOCK-UP AGREEMENT

—, 2014

▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇

Incorporated,

as Representative of the several

Underwriters to be named in the

within-mentioned Underwriting Agreement

▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇

▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇

Re:

Proposed Public Offering by Paramount Group, Inc.

Dear Sirs:

The undersigned, a stockholder and/or an officer and/or director of Paramount Group, Inc., a Maryland corporation (the “Company”) and/or holder of common units in Paramount Group Operating Partnership, LP, a Delaware limited partnership (the “Operating Partnership”), understands that ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated (“▇▇▇▇▇▇▇ ▇▇▇▇▇”) proposes to enter into an Underwriting Agreement (the “Underwriting Agreement”) with the Company and the Operating Partnership, providing for the public offering (the “Public Offering”) of shares (the “Securities”) of the Company’s common stock, par value $0.01 per share (the “Common Stock”). In recognition of the benefit that such an offering will confer upon the undersigned as a stockholder and/or an officer and/or director of the Company, and/or as a holder of common units in the Operating Partnership, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the undersigned agrees with each underwriter to be named in the Underwriting Agreement that, during the period beginning on the date hereof and ending on the date that is 180 days from the date of the Underwriting Agreement, the undersigned will not, without the prior written consent of ▇▇▇▇▇▇▇ ▇▇▇▇▇, directly or indirectly, (i) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant for the sale of, or otherwise dispose of or transfer any shares of the Company’s Common Stock or any securities convertible into or exchangeable or exercisable for Common Stock, whether now owned or hereafter acquired by the undersigned or with respect to which the undersigned has or hereafter acquires the power of disposition (collectively, the “Lock-Up Securities”), or exercise any right with respect to the registration of any of the Lock-Up Securities, or file or cause to be filed any registration statement in connection therewith, under the Securities Act of 1933, as amended, or (ii) enter into any swap or any other agreement or any transaction that transfers, in whole or in part, directly or indirectly, the economic consequence of ownership of the Lock-Up Securities, whether any such swap or transaction is to be settled by delivery of Common Stock or other securities, in cash or otherwise.

Notwithstanding the foregoing, the undersigned may pledge the Lock-Up Securities without the prior written consent of ▇▇▇▇▇▇▇ ▇▇▇▇▇ solely to the extent such pledge is (A) in connection with the indemnification obligations of the undersigned relating to New York real property transfer tax and for the benefit of the Company or the Operating Partnership; or (B) pursuant to the terms of the limited

partnership agreement of the Operating Partnership and for the benefit of the Company or the Operating Partnership, provided that (i) the undersigned will use the undersigned’s reasonable best efforts to notify ▇▇▇▇▇▇▇ ▇▇▇▇▇ at least three business days prior to any transfer of the Lock-Up Securities pursuant to any of the foregoing pledges that is required to be reported in any public report or filing with the Securities and Exchange Commission or otherwise, and (ii) the undersigned does not otherwise voluntarily effect any public filing or report regarding such transfers. Furthermore, notwithstanding the foregoing, and subject to the conditions below, the undersigned may transfer the Lock-Up Securities without the prior written consent of ▇▇▇▇▇▇▇ ▇▇▇▇▇, provided that (1) ▇▇▇▇▇▇▇ ▇▇▇▇▇ receives a signed lock-up agreement for the balance of the lockup period from each donee, trustee, distributee, or transferee, as the case may be, (2) any such transfer shall not involve a disposition for value (except with regards to any transfer or sale pursuant to clause (vi) below), (3) such transfers are not required to be reported with the Securities and Exchange Commission on Form 4 in accordance with Section 16 of the Securities Exchange Act of 1934, as amended (except with regards to any transfer or sale pursuant to clause (vi) below, prior to which the undersigned will notify ▇▇▇▇▇▇▇ ▇▇▇▇▇ in writing of its intention to file a Form 4, or a disposition by will or intestacy), and (4) the undersigned does not otherwise voluntarily effect any public filing or report regarding such transfers:

(i) as a bona fide gift or gifts or other dispositions by will or intestacy; or

(ii) to any trust for the direct or indirect benefit of the undersigned or the immediate family of the undersigned (for purposes of this lock-up agreement, “immediate family” shall mean any relationship by blood, marriage or adoption, not more remote than first cousin); or

(iii) as a distribution to limited partners, members or stockholders of or other holders of equity interests in the undersigned; or

(iv) to the undersigned’s affiliates or to any investment fund or other entity controlled or managed by the undersigned; or

(v) to an immediate family member of the undersigned or entities wholly owned by or for the benefit of the undersigned, the undersigned’s affiliates or immediate family members of the undersigned, or to an entity that is owned by the undersigned and the undersigned’s affiliates alone or with other stockholders that received Common Stock in connection with the Formation Transactions (as that term is defined in the Underwriting Agreement); or

(vi) to a spouse, former spouse, child or other dependent pursuant to a domestic relations order or an order of a court of competent jurisdiction; or

(vii) to the Company upon termination of the undersigned’s employment with the Company; or

(viii) to a nominee or custodian of a person or entity to whom a disposition or transfer would be permissible under clauses (i) through (vi) above.

Furthermore, the undersigned may sell shares of Common Stock of the Company purchased by the undersigned on the open market following the completion of the Public Offering if and only if (i) such sales are not required to be reported in any public report or filing with the Securities and Exchange Commission, or otherwise and (ii) the undersigned does not otherwise voluntarily effect any public filing or report regarding such sales.

The undersigned also agrees and consents to the entry of stop transfer instructions with the Company’s transfer agent and registrar against the transfer of the Lock-Up Securities except in compliance with the foregoing restrictions.

The undersigned understands that, if the Underwriting Agreement is not executed, or if the Underwriting Agreement (other than the provisions thereof which survive termination) shall terminate or be terminated prior to payment for and delivery of the Common Stock to be sold thereunder, the undersigned shall be released from all obligations under this lock-up agreement. The undersigned understands that the Underwriters are entering into the Underwriting Agreement and proceeding with the Public Offering in reliance upon this lock-up agreement.

[Signature Page Follows]


Very truly yours,

Signature:
Print Name:

Lock-Up Agreement

EXHIBIT G

Assignment and Assumption Agreement

[See attached]

G-1

EXHIBIT D

FORM

ASSIGNMENT AND ASSUMPTION AGREEMENT

(Name of Entity)

This Assignment and Assumption Agreement (the “Agreement”) is made and entered into as of , 2014 by and between [Name of Entity], a Delaware limited partnership (“Transferor”), Paramount Group Operating Partnership LP (“Transferee”) and Paramount Group, Inc., a Maryland corporation (the “Company”).

WHEREAS, pursuant to the Contribution Agreement, dated as of , 2014, by and among Transferor, Transferee and the Company (the “Contribution Agreement”) the Transferor desires to contribute to the Transferee all of its assets (other than Excluded Assets) and liabilities (the “Contributed Interests”) and the Transferee shall acquire from the Transferor all of the Transferor’s right, title and interest in the Contributed Interests;

NOW THEREFORE, in consideration of the promises and covenants herein contained, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows:

Assignment. The Transferor hereby contributes, assigns, transfers and delivers to the Transferee, and the Transferee hereby accepts and assumes, all of the Transferor’s right, title and interest in and to the Contributed Interests.

Assumption. Transferee hereby assumes and agrees to perform all of the liabilities, duties and obligations of Transferor with respect to the Contributed Interests.

Representations and Warranties. Each party hereto represents and warrants to the other parties that this Agreement has been duly executed and delivered by such party and constitutes the legal, valid and binding obligation of such party enforceable against it in accordance with its terms, except as may be limited by applicable bankruptcy, insolvency, moratorium or similar laws of general applicability relating to or affecting creditors’ rights generally, and except for limitations imposed by general principles of equity.

Further Assurances. Each party hereby agrees to use reasonable efforts to take, or cause to be taken, all actions, and to do, or cause to be done, all things necessary, proper or advisable, consistent with applicable law to consummate and make effective the transactions contemplated hereby.

Effectiveness. This Agreement shall have an effective date as of the date first written above, and all of the transactions contemplated hereby shall be deemed effective as of such date and specified time.

Counterparts. This Agreement may be executed in counterparts, all of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument.

Entire Agreement. This Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and understanding between the parties hereto with respect to such subject matter.

Severability. In the event that any one or more of the provisions contained in this Agreement or in any other instrument referred to herein, shall, for any reason, be held to be invalid, illegal or unenforceable in any respect, then to the maximum extent permitted by law, such invalidity, illegality or unenforceability shall not affect any other provision of this Agreement or any other such instrument.

Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. No such party may assign any rights or obligations hereunder without the prior written consent of the other parties hereto.

10.

Amendment, Waiver and Termination. This Agreement may not be amended or terminated, and no provision hereof may be waived, except by a writing signed by each of the parties hereto.

11.

Third Party Beneficiaries. This Agreement is not intended to confer upon any other Person any rights or remedies hereunder.

12.

Governing Law. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS (BOTH SUBSTANTIVE AND PROCEDURAL) OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO THE CHOICE OF LAW OR CONFLICTS OF LAW PRINCIPLES THEREOF.

[Signature pages follow]

SCHEDULE 1.01

Excluded Assets

All of the interests in Kommanditgesellschaft Grundstücksgesellschaft EKZ Schwedt m.b.H. & Co. held by Arcade

Schedule 1.01

SCHEDULE 1.02

Consideration

Arcade

Consideration

456,362 Company Shares

Schedule 1.02

CONTRIBUTION AGREEMENT by and among ARCADE RENTAL INVESTMENTS, INC., PARAMOUNT GROUP, INC., and THE STOCKHOLDER of ARCADE RENTAL INVESTMENTS, INC. Dated as of November 6, 2014

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