EFTA00312957.pdf

(viii) Commencing as of the date hereof and through the date of closing of title hereunder, Seller shall: (a) not grant, sell or convey any interest in the Premises, including easements, rights-of-way or liens, to any person, corporation,_ public or private, governmental body or political subdivision, without the prior written consent of Purchaser (except that (i) Purchaser agrees not to unreasonably withhold its consent to the grant, sale or conveyance of util- ity or similar easements that do not adversely affect Pur- chaser's intended use of the Premises, and (ii) Seller may mortgage the Premises to secure obligations that do not exceed Ten Million Dollars ($10,000,000.00) in the aggregate); and (b) maintain the improvements located on the Premises in good condition, subject to reasonable wear and tear and natural deterioration. 24. The obligation of Purchaser to proceed to the Closing is subject to the fulfillment of the following condi- tions, except to the extent that any of such conditions may be waived by Purchaser: (i) Title to the Premises shall be acceptable to Pur- chaser as provided in Paragraph 15 as of the Closing Date; (ii) The representations and warranties of Seller contained in Paragraph 22, except as contained in subpara- graph 22(A)(viii) thereof, or otherwise made in writing shall be true and correct in all material respects as of the Closing Date as though made on such date, except for any change contem- plated or permitted by this Contract; (iii) Seller shall have duly performed and complied with all agreements and conditions required by this Contract to be performed and complied with by Seller; (iv) Seller shall have delivered to Purchaser a certifi- cate executed by Seller to the effect that, as of the Closing Date, all representations and warranties made by Seller under this Contract and all certificates and exhibits given and delivered to Purchaser pursuant to this Contract are, to the best of Seller's knowledge, true and correct; (v) This Contract shall not have been terminated as herein provided; and (vi) Seller shall have received Seller's Court Approvals or Seller shall have determined same is unnecessary in -17- EFTA00312957 connection with the transaction contemplated by this Contract, and Purchaser's attorney and the Title Company agree therewith. 25. Each and every one of the following events shall constitute a default of Seller under this Contract (an "Event of Default"); (i) A default in the payment of any amounts due to be paid by Seller pursuant to this Contract; (ii) A failure of Seller to deliver certificates of insurance as set forth in subparagraph 23(v) hereof; (iii) Any failure of Seller to observe or perform any of the other covenants, terms or conditions set forth in this Con- tract; (iv) A failure by Seller to adequately secure the improvements located on the Premises against further damage following the damage or destruction of all or any portion of the improvements by fire or other casualty; and (v) Should any representation or warranty made by Seller in this Contract prove to be untrue in any material respect and as a result of said untruth, the value of the Prem- ises is materially adversely affected thereby. 26. If there has been an Event of Default by Seller under this Contract, and the Event of Default continues for fifteen (15) days after Seller has received written notice thereof from Purchaser (except that if such Event of Default shall require more than fifteen (15) days to remedy, and Seller shall not have remedied such Event of Default within a period of time reasonably required to remedy said Event of Default), then, in that event, Purchaser shall send an additional written notice to Seller and, if Seller fails to remedy said Event of Default within five (5) days after receipt of Purchaser's sec- ond written notice, then Purchaser shall have the option to (i) terminate this Contract, or (ii) take action to cure Seller's default, provided, however, that Purchaser may, fol- lowing an Event of Default, enter into or upon the Premises, either personally or by its agents, nominees or attorneys, to cure such default. Such option of Purchaser shall be exercised by written notice to Seller. In the event that Purchaser ter- minates this Contract as provided in this Paragraph 26, neither party shall have any liability whatsoever to the other hereunder except that Purchaser shall be entitled to (i) a return of the Letter of Credit or the proceeds thereof, as the case may be, and (ii) reimbursement for the net charges for -18- EFTA00312958 surveys and examination of title actually incurred by Purchaser as evidenced by paid receipts provided to Seller. Following the occurrence of any Event of Default, Purchaser may person- ally or by his agents or attorneys insofar as may be applica- ble, take such steps to protect and enforce his rights by suit or proceeding in equity for the specific performance of this Contract, in all events Seller shall promptly return the Letter of Credit or the proceeds thereof, as the case may be, to Pur- chaser and reimburse Purchaser for the net charges for surveys and for examination.of title actually incurred by Purchaser as evidenced by paid receipts provided to Seller. 27. If, prior to the Closing Date, any portion of the Premises is taken by eminent domain, Seller shall notify Purchaser of such fact and Purchaser shall have the option to terminate this Contract upon notice to Seller given not later than sixty (60) days after receipt of Seller's notice. If this Contract is terminated as aforesaid, the Letter of Credit or the proceeds thereof, as the case may be, shall be returned by Escrow Agent to Purchaser and, thereafter, neither Purchaser nor Seller shall have any further rights or obligations to the other hereunder. In case of any such taking, if Purchaser elects not to terminate this Contract as aforesaid, there shall be no abatement of the Purchase Price but Seller shall assign and turn over at the closing of title, and Purchaser shall he entitled to receive and keep, all awards for such taking. The provision of this Paragraph 27 shall govern in place of Section 5-1311 of the General Obligations Law. 28. If, prior to the Closing Date, all or any por- tion of the Premises is destroyed or damaged by fire or other casualty, Seller shall notify Purchaser of such fact but Pur- chaser shall have no option to terminate this Contract; rather, the closing of title shall occur as provided in this Contract, except as otherwise provided in the last sentence of this Para- graph 28, and there shall be no abatement of the Purchase Price, provided, however, that, at Seller's option, exercised by notice to Purchaser within ten (10) days after the date of such casualty, Seller may elect either to (i) repair the dam- age, and the Closing shall be adjourned at Seller's request for one or more periods, not to extend beyond September 1, 1990, in order to permit Seller to make such repair, and Seller shall be reimbursed from insurance proceeds received or to be received for expenses incurred in connection with the repair, including legal expenses and expenses of collection of the proceeds, and Seller may retain the proceeds remaining after payment of all expenses associated with the repair, if any, or (ii) Seller shall assign and turn over, at the closing of title hereunder, -19- EFTA00312959 and Purchaser shall be entitled to receive and keep, all insur- ance proceeds paid or to be paid to compensate for the damage to the Premises caused by such casualty that remain after legal and other expenses of collection, without further abatement of the Purchase Price. In the event Seller elects not to repair as above provided, then,•at Seller's option, the Closing Date may be accelerated to such other date (but in no event earlier than 60 days after the date Purchaser receives notice of Seller's election) as may be reasonably requested by Seller giving due consideration to the fact that Seller operates a school. The provisions of this Paragraph 28 shall govern in place of Section 5-1311 of the General Obligations Law. 29. Seller and Purchaser each shall complete, exe- cute, verify and deliver to the appropriate party, in a timely manner so as not to delay the Closing, any appropriate returns, questionnaires, affidavits or other documents required with respect to Article 31B of the New York Tax Law (the "Gains Tax Law") by reason of the transaction contemplated by this Con- tract and which are required to be completed, executed, delivered or verified by Seller and Purchaser, respectively. Seller and Purchaser shall each have the right to review the returns, questionnaires, affidavits and other documents which the other party proposes to deliver prior to such delivery. In the event that either Seller or Purchaser does not deliver such returns, questionnaires, affidavits and other documents in a timely manner so as not to delay the Closing, Seller or Pur- chaser, as the case may be, is hereby authorized to deliver such documents on behalf of the other party. Seller shall pay any tax which may be determined to be due under the Gains Tax Law in connection with this transaction. Seller shall defend, indemnify and hold Purchaser harmless with respect to all claims based on a breach or alleged breach by Seller of its obligations contained in this Paragraph 29, and Paragraphs 8, 9 and the first sentence of Paragraph 23(ii), together with any and all losses, damages, costs and expenses (including reason- able attorneys' fees and disbursements) relating to such claims or arising therefrom or incurred by Purchaser in connection with the enforcement of this indemnification provision. The provisions of this Paragraph shall survive the Closing. 30. Seller shall complete, execute, verify and deliver to the appropriate authorities a certification in the form substantially similar to that set forth on Exhibit D annexed hereto and made a part hereof, and such other docu- ments, affidavits or certificates which may be required to be completed, executed, delivered or verified by Seller -20- EFTA00312960 (collectively, the "Other Documents") with respect to Section 1445 of the Internal Revenue Code of 1986 (the "FIRPTA Certifi- cation") by reason of the transactions contemplated by this Contract. 31. Purchaser.agrees that it will not assign its interest in this Contract unless Seller shall have consented thereto by a signed writing, which consent may be withheld for any or no reason at Seller's sole and absolute discretion. Notwithstanding the foregoing, Purchaser may assign his inter- est in this Contract to any family member or any corporation, partnership or trust which is controlled directly or indi- rectly, through ownership, agreement or otherwise, by Pur- chaser-, or to The Wexner Foundation, The Leslie H. Wexner Foun- dation, The Wexner-Heritage Foundation or any other charitable foundation formed by Purchaser or of which he is a past or present trustee, director or other fiduciary. 32. Purchaser and Purchaser's designees shall have the right to enter into and upon the Premises prior to the Closing Date, from time to time, during school breaks or recesses or after school hours, and upon reasonable notice, for purposes of arranging for certain renovation, decorating and remodeling of the Premises which Purchaser intends to perform after the Closing (the "Renovation Work"), provided, however, that Purchaser shall be liable to Seller for any damage or destruction to the Premises caused by the inspection thereof pursuant to this Paragraph 32, including, but not limited to, liability for any Violations, including Violations with respect to asbestos, created thereby, and, in no event, shall Purchaser or its designees have any right to puncture the walls or ceil- ings, drill into same or otherwise invade the spaces bounded thereby. In connection with Purchaser's preparations for the Renovation Work, the Seller shall cooperate with Purchaser in (i) the obtaining of any and all permits, approvals and certif- icates required by any governmental or other authorities, including, without limitation, public utilities and landmark authorities (collectively, "the Permits"), and shall promptly execute any applications, certificates, documents or papers requested by Purchaser in connection therewith, provided, how- ever, that Purchaser pays all of the costs and expenses of Seller incurred in connection therewith, including reasonable attorneys'- fees and disbursements and (ii) the prosecution of any legal or administrative proceedings or actions to the extent reasonably requested by Purchaser, at Purchaser's expense, and Seller shall not withhold its consent to the pros- ecution of any such proceedings or actions in the name of Seller, if, in the reasonable opinion of counsel to Purchaser, such action or proceeding should be prosecuted in the name of -21- EFTA00312961 Seller for the success thereof. Purchaser shall indemnify Seller against all reasonable costs and expenses of, and claims which may be asserted against Seller in connection with, Seller's prosecution of any legal or administrative proceedings or actions as aforesaid. Seller shall, at the Closing, assign to Purchaser, in the manner and to the extent directed by Pur- chaser, all of the right, title and interest of Seller under all of the Permits to the extent assignable and not required in connection with the operation of a school by Seller in which case, Purchaser shall assume all of Seller's liabilities and obligations arising under the Permits from and after the date of such assignment. Purchaser shall pay all of the costs and expenses of Seller, including reasonable attorneys' fees and disbursements incurred by Seller in connection with the assign- ment of the Permits to Purchaser. The covenants contained in this Paragraph shall survive the Closing. 33. Any errors or omissions in computing apportion- ments at the Closing shall be corrected promptly after their discovery. The provisions of this Paragraph shall survive the Closing. 34. This Contract (a) contains the entire agreement between the parties hereto, (b) is entered into after full investigation, neither party relying upon any statement or rep- resentation, not embodied in this Contract, made by the other, (c) may not be changed, modified or terminated orally, but only by an instrument in writing, signed by the party against whom enforcement of any waiver, modification or discharge is sought, and (d) is to be deemed to have been jointly prepared by the parties hereto, and any uncertainty or ambiguity existing herein, if any, shall not be interpreted against either party, but shall be interpreted according to the application of the rules of interpretation for arm's-length agreements. The stip— ulations aforesaid are to apply to and bind the heirs, execu- tors, administrators, successors and assigns of the respective parties. If any term or provision of this Contract shall, to any extent, be invalid or unenforceable, the remainder of this Contract shall not be affected thereby, and each term and pro- vision of this Contract shall be valid and be enforced to the fullest extent permitted by law. 35. If two or more persons constitute either Seller or Purchaser, the word 'Seller' or the word "Purchaser" shall be construed as if it read "Sellers' or "Purchasers" whenever the sense of this Contract so requires. 36. Anything contained in this Contract to the con- trary notwithstanding, but subject, however, to the terms and -22- EFTA00312962 provisions of subparagraph 39.C.(B) hereof, the liability of Seller upon Seller's default under this Contract shall be lim- ited to Seller's interest in the Premises, or any part thereof, and no other property or assets of Seller shall be subject to levy, execution or other enforcement procedure for the satis- faction of Purchaser's claims or any judgments against Seller. Purchaser, by his execution of this Contract, agrees that, in the event he pursues any remedies available to him hereunder or under instruments delivered pursuant to this Contract, Pur- chaser shall have no monetary recourse against Seller or any of Seller's successors or assigns other than as hereinabove set forth, nor against any officer, shareholder, director, trustee, principal, employee or agent of Seller, or any of such succes- sors' or assigns' officers, shareholders, directors, trustees, employees, principals or agents for any deficiency, loss or claim for monetary damages resulting therefrom, and none of the personal property or assets of any of the foregoing persons shall be subject to levy, execution or other enforcement proce- dure for the satisfaction of the remedies of Purchaser hereunder. Upon Seller's default pursuant to this Contract, if Seller shall promptly return the Letter of Credit or the pro- ceeds thereof, as the case may be, and reimburse Purchaser for the cost of title examination and survey, then Purchaser's sole remedy hereunder is to seek specific performance for the enforcement of this Contract. 37. No waiver by either party of any failure or refusal by the other party to comply with its obligations here- under shall be deemed a waiver of any other or subsequent fail- ure or refusal to so comply. 38. This Contract shall be governed by, interpreted under, and construed and enforced in accordance with, the laws of the State of New York. 39. The Letter of Credit shall be held by Battle Fowler (the 'Escrow Agent") in escrow upon the following terms and conditions: A. If the closing of title takes place, Escrow Agent shall either (i) draw upon the Letter of Credit and deliver the proceeds of the Letter of Credit to, or upon the instructions of, Seller at the closing of title or (ii) if Purchaser delivers written notice to Seller and Escrow Agent at least ten (10) days prior to the closing of title that Purchaser intends to pay to Seller by cash or good certified check the amount of the Downpayment, then, upon such payment by Purchaser to Seller at the closing of title, Escrow Agent shall return the Letter of Credit to, or upon the instructions of, Purchaser at the closing of title. -23- EFTA00312963 B. If this Contract is terminated in accordance with the terms hereof, and the party entitled to the proceeds of the Letter of Credit in accordance with the provisions of this Con- tract is Seller, Escrow Agent shall draw upon the Letter of Credit and deliver the proceeds thereof to, or upon the instructions of Seller; otherwise, if the party entitled to the return of the Letter of Credit in accordance with the provi- sions of this Contract is Purchaser, the Letter of Credit shall be so returned to Purchaser. C. (A) If Seller shall be ready, willing and able to close title in full compliance with its obligations under this Contract, and if Purchaser shall default in its obliga- tions under the terms of this Contract, Seller shall deliver written notice to Escrow Agent and Purchaser claiming Pur- chaser's default, and, if Purchaser fails to contest such claim by written notice to Escrow Agent received by Escrow Agent within ten days after receiving Seller's notice as aforesaid, then Escrow Agent shall draw upon the Letter of Credit and Seller shall be entitled to receive, and Escrow Agent shall deliver to Seller, the proceeds received by drawing on the Let- ter of Credit, and, thereupon, Escrow Agent's responsibilities under this Contract shall terminate. (B) If Purchaser shall be ready, willing and able to close title in full compliance with its obligations under this Contract, and if Seller shall default in its obligations under the terms of this Contract, Purchaser shall deliver written notice to Escrow Agent and Seller claiming Seller's default, and, if Seller fails to contest such claim by written notice to Escrow Agent received by Escrow Agent within ten days after receiving Purchaser's notice as aforesaid, then Purchaser shall be entitled to receive, and Escrow Agent shall return to Pur- 'chaser, the Letter of Credit, or the proceeds thereof, as the case may be, and thereupon, Escrow Agent's responsibilities under this Contract shall terminate. D, NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS CONTRACT, IF EITHER PARTY SHALL CONTEST THE CLAIM OF THE OTHER PARTY TO THE RETURN OF THE LETTER OF CREDIT OR THE PROCEEDS THEREOF, AS HEREIN PROVIDED, ESCROW AGENT SHALL CONTINUE TO HOLD THE LETTER OF CREDIT OR THE PROCEEDS THEREOF, AS THE CASE MAY BE, PURSUANT TO THE TERMS OF THIS CONTRACT, AND PURCHASER'S SOLE REMEDY ON ACCOUNT OF ANY CLAIMED SELLER BREACH SHALL BE TO SEEK SPECIFIC PERFORMANCE FOR THE ENFORCEMENT OF THIS CONTRACT. -24- EFTA00312964 E. It is agreed that: (a) the duties of Escrow Agent are only as herein specifically provided and are purely ministerial in nature, and that Escrow Agent shall incur no liability whatever except for willful misconduct or gross negligence as long as Escrow Agent has acted in good faith; (b) Escrow Agent shall not be liable or responsible for the collection of the proceeds of the Letter of Credit; (c) in the performance of its duties hereunder, Escrow Agent shall be entitled to rely upon any document, instrItment or signature believed by it to be genuine and signed by either of the parties hereto or their, successors and assigns; (d) Escrow Agent may assume that any person pur- porting to give any notice or instructions in accordance with the provisions hereof has been duly authorized to do so; (e) Escrow Agent shall not be bound by any modifica- tion, cancellation or rescission of this Contract unless in writing and signed by it, Seller and Purchaser; (f) Seller and Purchaser shall jointly and severally reimburse and indemnify Escrow Agent for, and shall hold it harmless from and against, any and all loss, liability, cost or expense, including, without limitation, reasonable attorneys' fees and disbursements and reasonable court costs and expenses of defending any claim or liability, incurred by it without its willful misconduct or gross negligence and arising out of or in connection with its acceptance of, or its performance of its duties and obligations under, this Contract; and (g) Seller and Purchaser each hereby release Escrow Agent from any act done or omitted to be done by the Escrow Agent in good faith in the performance of its duties hereunder. F. Escrow Agent is acting as a stakeholder only with respect to the Letter of Credit, or proceeds thereof, as the case may be, and any other monies held by Escrow Agent pursuant to the terms of this Contract. If there is any dispute as to whether Escrow Agent is obligated to deliver the Letter of Credit, or proceeds thereof, as the case may be, or any other monies held by Escrow Agent, or as to whom the Letter of Credit, or proceeds thereof, as the case may be, or any other monies held by Escrow Agent, is to be delivered, Escrow Agent shall hold the same until receipt by Escrow Agent of an -25- EFTA00312965 authorization in writing, signed by all of the parties having any interest in such dispute, directing the disposition of the Letter of Credit or the proceeds thereof, as the case may be, or any other monies held by Escrow Agent, or, in the absence of such authorization, Escrow Agent shall hold the Letter of Credit or the proceeds thereof, as the case may be, or any other monies held by Escrow Agent, until the final determina- tion of the rights of the parties in an appropriate proceeding. If such written authorization is not given or proceedings for such determination are not begun within thirty days after the date set forth herein for the Closing Date and diligently con- tinued, the Escrow Agent may bring an appropriate action or proceeding for leave to deposit the Letter of Credit or the proceeds thereof, as the case may be, or any other monies held by Escrow Agent, in court pending such determination. Escrow Agent shall be reimbursed for all costs and expenses of such action or proceeding, including, without limitation, reasonable attorneys' fees and disbursements, by the party determined not to be entitled to the Letter of Credit or the proceeds thereof, as the case may be, or any other monies held by Escrow Agent, or if the Letter of Credit or the proceeds thereof, as the case may be, or any other monies held by Escrow Agent, are split between the parties hereto, such costs of Escrow Agent shall be split, pro rata, between Seller and Purchaser, based upon the amount of the proceeds of the Letter of Credit and/or other monies, received by each. Upon making delivery of the Letter of Credit or the proceeds thereof, as the case may be, or any other monies held by Escrow Agent, in the manner provided in this Contract, Escrow Agent shall have no further liability hereunder. G. Escrow Agent has executed this Contract solely to confirm that Escrow Agent has received the Letter of Credit and that it shall hold same in escrow, pursuant to the provisions of this Contract. K. Escrow Agent shall have the right to represent Seller in any dispute between Seller and Purchaser with respect to the Letter of Credit or otherwise. 40. The parties agree that neither the Contract nor any memorandum or notice thereof shall be recorded, and Pur- chaser agrees not to file any notice of pendency against the Premises as long as Seller is not in default in the performance or observance of its obligations hereunder. -26- EFTA00312966 JUN 21 'ea 23:58 BATTLEAA P.61 41. This Contract may be executed in any number of counterparts, each of which counterparts, when so executed and delivered, shall be deemed to be an original and all of which counterparts, taken together, shall constitute one and the same Agreement. IN WITNESS WHEREOF, this Contract has been duly exe- cuted by the parties hereto. In the presence of: Leslie H. Wexner Purchaser BIRCH WATHEN SCHOOL, INC., Seller By: Name; Title: e 5 vi,ss6„..;c_a_ INAv.2.7......) e'en- i• Vice Prpiacal- BATTLE FOWLER, Escrow Agent By: 1(12711- / A Partner -27- EFTA00312967 Exhibit A ALL that certain lot, piece or parcel of land, situate, lying and being in the Borough of Manhattan, City, County and State of New York, bounded and described as follows: BEGINNING at a point on the northerly side of 71st Street dis- tant 225 feet easterly from the corner formed by the intersec- tion of the easterly side of 5th Avenue with the northerly side of 71st Street; running thence Easterly along the northerly side of 71st Street 50 feet; ' thence Northerly and parallel with 5th Avenue 102 feet 2 inches to the centre line of the block between 71st and 72nd Streets; thence westerly along the said center line and parallel with 71st Street 50 feet; thence Southerly and parallel with 5th Avenue 102 feet 2 inches to the northerly side of 71st Street at the point or place of Beginning. EFTA00312968 Exhibit B (Covenants, Restrictions, Agreements) None EFTA00312969 Schedule C Personal Property One (1) Louis XIV Painted Armchair One (1) Mahogany Dining Table Twelve (12) Dining Chairs One (I) set Mahogany Dining Furniture One (1) Desk — Early Louis XIV EFTA00312970 Exhibit D Note — Attached EFTA00312971 PROMISSORY NOTE New York, New York November , 1998 FOR VALUE RECEIVED, the undersigned, NES, LLC, a New York limited liability company (the "Make?), hereby unconditionally promises to pay to the order of Leslie H. Wexner (the "Holder") the principal amount of Ten Million Dollars ($10,000,000), together with interest on the unpaid principal balance at the rate of four and five-tenths percent (4.5%) per annum, on December 31, 1999. All payments of principal and interest hereunder shall be made in lawful mone of the United States, in immediately available funds at (or at such other place as the Holder of s ote maydesignate rn writing to the Maker). In the event that any payment hereunder shall become due on a Saturday, Sunday or legal or bank holiday under the laws of the place at which such payment is to be made hereunder, such payment shall be made on the next succeeding business day. This Note is made and delivered to the Holder pursuant to the provisions of a certain Purchase and Sale Agreement of even date herewith by and between the Maker and the Holder. The payment of this Note is guaranteed by Jeffrey E. Epstein (the "Guarantor") as provided under a certain Guaranty of even date herewith. I. Voluntary Prepayment. The unpaid principal amount of this Note and/or any accrued interest hereunder may be prepaid at any time, in whole or in part, without premium or penalty. Any such prepayment shall first be applied to accrued interest and then to principal hereunder. 2. Events of Default. (a) If any of the following events shall occur during the term hereof, such events shall be deemed a default by the Maker hereunder (each an "Event of Default"): (i) The Maker shall have defaulted in the payment of any principal or interest under this Note as and when such payment shall have become due and payable in accordance with the terms hereof and failed to cure such default within ten (10) business days of the Maker's receipt from the Holder of written notice of such default; (ii) There shall have been entered by a court of competent jurisdication any order, judgment or decree for relief in respect of the Maker or the Guarantor under any applicable Federal or state bankruptcy law or other similar law, or EFTA00312972 appointing a receiver, an assignee, a trustee or a custodian of all or a substantial part of any of the Maker's or the Guarantor's property, assets or revenues, and such order, judgment or decree shall have been continued unstayed, unbonded and in effect for a period of 60 days; (iii) The filing by the Maker or the Guarantor of a petition or a consent to a petition seeking relief under Title 11 of the United States Code, as now or hereafter constituted, or any other applicable Federal or state bankruptcy, insolvency or other similar law, or the consent by the Maker or the Guarantor to the institution of proceedings thereunder or to the filing of any such petition or to the appointment or taking of possession by a receiver, a liquidator, an assignee, a trustee or a custodian, of any substantial part of the property, assets or revenues of the Maker or the Guarantor, or the making by the Maker or the Guarantor of an assignment for the benefit of creditors, or the inability of the Maker or the Guarantor to pay its or his debts as they become due and payable; (iv) The Guarantor does not own a majority of the membership interests of the Maker; or (v) The sale or other transfer of all, or substantially all, of the Maker's assets to any person other than the Guarantor or an affiliate of the Guarantor. (b) In the case of an Event of Default, without any demand, presentment, protest or other notice whatsoever to the Maker, or other statutory or other rights of redemption, or any other action by the Holder, all of which are hereby expressly waived by the Maker, the unpaid principal amount hereof and accrued interest hereunder shall become due and payable in full upon the occurrence of any such Event of Default and the Holder may exercise, simultaneously or seriately, any or all of such other rights and remedies as may be lawfully permitted under Federal law or state law and any and all of the remedies of the Holder set forth herein. (c) All payments hereunder shall first be applied to accrued interest and then to principal hereunder. 4. No Off-Set. All sums payable by the Maker under this Note shall be made without reduction for any reason in respect of set-off, counterclaim or otherwise. 5. Loss. etc. of Note. At the Holder's request and upon the Maker's receipt of evidence reasonably satisfactory to the Maker of the loss, theft, destruction or mutilation of this Note, and of indemnity reasonably satisfactory to the Maker, the Maker shall execute and deliver to Holder a new note identical in all respects to this Note. 6. Waivers. The Maker hereby waives diligence, presentment, protest and demand, and also notice of protest, of demand, of non-payment, of dishonor and of maturity. 2 EFTA00312973 7. Governing Law. This Note shall be governed by, and construed in accordance with, the laws of the State of New York applicable to contracts to be performed entirely within that state, without giving effect to the principles of conflict of laws thereof. 8. Non-Waiver. My waiver of any provision hereof must be in writing. No failure on the part of the Holder to exercise, and no delay in exercising, any right, power or privilege under this Note shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power or privilege under this Note preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The remedies herein provided are cumulative and not exclusive of any and all other remedies provided by law. 9. Collection. The Maker hereby agrees to pay, upon demand by the Holder, in lawful money of the United States of America, all of the Holder's reasonable costs and expenses of enforcement and collection of this Note, including, but not limited to, reasonable attorneys' fees and disbursements, in the event and to the extent that it beomes necessary for the Holder to enforce any of the provisions of this Note, including, but not limited to, the Maker's obligations to pay the principal and interest as provided herein. 10. Notices. Each notice or other communication required or permitted hereunder shall be given by certified or registered mail, return receipt requested, by reputable overnight delivery service or by personal delivery addressed to the intended recipient thereof at its or his address set forth below or at such substituted address as either party hereto may from time to time designate for such purpose by notice given in like manner to the other party hereto: If to the Maker, to it at: NES, LLC If to the Holder, to it at: Leslie H. Wexner Each such notice or other communication so given shall be deemed to have been given and received three (3) business days after deposit with the United States Post Office, if so 3 EFTA00312974 mailed; one (1) business day after depositing with the overnight cornier, if sent by overnight delivery service; or as of the time of delivery, of personally delivered. NES, LLC By: Jeffrey E. Epstein Member 4 EFTA00312975 Exhibit E Guaranty — Attached EFTA00312976 GUARANTY THIS GUARANTY dated as of November , 1998, by Jeffrey E. Epstein, who has an address at 358 El Brillo Way, Palm Beach, FL 33480 (the "Guarantor"). WHEREAS, pursuant to a certain Purchase and Sale Agreement of even date herewith (the "Agreement") by and between NES, LLC, a New York limited liability company (the "Maker"), and Leslie H. Wexner (the "Holder"), the Maker is required to execute and deliver to the Holder a promissory note (the "Note") in the principal amount of Ten Million Dollars ($10,000,000) (the Maker's obligations under the Note are sometimes hereinafter referred to as the "Obligations"); WHEREAS, the Guarantor desires that the Holder execute the Agreement and consummate the transactions contemplated thereby and, as the sole member of the Maker, will derive benefits from such transactions; and WHEREAS, the Holder will not execute the Agreement and accept the Note, unless the Guarantor guarantees payment of the Obligations; NOW, THEREFORE, in consideration of the foregoing premises and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the Guarantor, the Guarantor hereby agrees as follows: ARTICLE I Terms of the Guaranty Section 1.1 Guaranty of Payment. In order to induce the Holder to enter into the Agreement and accept the Note, the Guarantor hereby guarantees to the Holder the payment of the Obligations when due, whether at stated maturity, by acceleration or otherwise. This is a guaranty of payment, and not a guaranty of collection. Section 1.2 Enforcement of Guaranty. The Holder, in his sole discretion, may proceed directly against the Guarantor to exercise any right or remedy that the Holder may have under this Guaranty without pursuing or exhausting any other right or remedy that the Holder may have against the Maker, any other guarantor or any collateral and without regard to any action or omission of the Maker or any other third party. The Holder may institute separate proceedings with respect to this Guaranty and the Note, in such order and at such times as the Holder may elect. Section 1.3. Guaranty Absolute. The obligations of the Guarantor hereunder shall be absolute and unconditional, regardless of the validity, legality or EFTA00312977 enforceability of any of the provisions of the Note or the Agreement, the existence, value or condition of any collateral for the Obligations or any other event that might otherwise constitute a legal or equitable discharge of a surety or guarantor, and the obligations of the Guarantor hereunder shall not be subject to any defense, counterclaim, setoff, recoupment, abatement, reduction or other determination that the Guarantor may have against the Holder, the Maker or any other third party, it being agreed that the agreements and liabilities of the Guarantor hereunder shall not be discharged except by payment of all amounts due under the Note and under this Guaranty. Section 1.4. Guaranty Not Affected. Without limiting the generality of Section 1.3 hereof, the Guarantor hereby consents and agrees that, at any time, and from time to time: (a) the time, manner, place and terms of payment of the Obligations may be extended or changed; (b) any action may be taken under, or in respect of, any of the provisions of the Note in the exercise of any remedy, power or privilege, or any one or more rights of the Holder under the Note may be waived, omitted, or not enforced; (c) the time for the performance of, or compliance with, any term, covenant or agreement by the Maker on its part to be performed or observed under the Note may be extended, or the performance thereof, or the compliance therewith, may be waived, or the failure of, or the departure from, such performance or compliance may be consented to; (d) the Note may be modified, amended or restated from time to time in any respect (including, without limitation, with respect to the rate of interest due under the Note); and (e) the liability of the Maker to pay any and all of the amounts due under the Note may be settled or compromised, and payment of any and all of the Obligations may be subordinated to the prior payment of any other debts or claims of the Maker; all in such manner and upon such terms as the Holder may deem proper, and without notice to, or further assent from, the Guarantor, and all without affecting this Guaranty or the obligations of the Guarantor hereunder, which shall continue in full force and effect until the Obligations and all agreements and liabilities of the Guarantor hereunder and under the Note shall have been fully performed and paid. Section 1.5. Waiver. Any waiver of any provision hereof must be in writing and shall be effective only in the specific instance and for the specific purpose for which such waiver is given. No failure on the part of the Holder to exercise, and no delay in exercising, any right, power or privilege under this Guaranty shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power or privilege under this Guaranty preclude any other or further exercise thereof or the exercise of any other right, power or privilege hereunder. The remedies herein provided are cumulative and not exclusive of any and all other remedies provided by law. 2 EFTA00312978 Section 1.6. Reinstatement. The provisions of this Guaranty shall continue to be effective or shall be reinstated, as the case may be, if payment, or any part thereof, of any of the Obligations is rescinded or must otherwise be restored or returned by the Holder upon the insolvency, bankruptcy or reorganization of the Maker or the Guarantor, whether by order of any court, by any settlement approved by any court, or otherwise, all as though such payment had not been made. Section 1.7. Subrogation and Contribution. The Guarantor shall not exercise any rights that he may have acquired under this Guaranty by way of contribution, subrogation or otherwise, unless and until all of the Obligations shall have been paid in full, and, if payment shall be made to the Guarantor on account of such rights at any time when all of the Obligations shall not have been paid in full, each and every amount so paid shall be held in trust for the benefit of the Holder and promptly shall be paid to the Holder, who shall credit and apply the same to the payment of any portion of the Obligations as the Holder may elect, whether such portion of the Obligations is matured or unmature. Section 1.8. Binding Effect. This Guaranty shall be binding upon the estate, the heirs and the personal representatives of the Guarantor, and shall inure to the benefit of the Holder, his assigns, and the estates, the heirs and the personal representatives of the Holder and his assigns. ARTICLE II Miscellaneous Section 2.1. Notice. Any and all notices or other communications or deliveries required or permitted hereunder to be given or made shall be in writing and delivered personally, or sent by certified or registered mail, return receipt requested and postage prepaid, or sent by reputable overnight courier service as follows: If to the Guarantor, to him at: Jeffrey E. Epstein 358 El Brillo Way Palm Beach, FL 33480 If to the Holder, to hint at: Leslie H. Wexner Wexner or at such other address as either the Guarantor or the Holder may specify by notice given to the Holder in accordance with this Section 2.1. Each such notice or other 3 EFTA00312979 communication or delivery shall be deemed to be given and received on the date of hand delivery; three (3) business days after the date of the posting of the mail, if sent by certified or registered mail; or one (1) business day after the date it is deposited with the overnight courier, if sent by reputable overnight courier service. Section 2.2. Governine Law. This Guaranty shall be construed (both as to validity and performance) and enforced in accordance with, and governed by, the laws of the State of New York applicable to contracts to be performed entirely within that State, without giving effect to its principles of conflicts of law. Section 2.3 Severability. In the event that any provision of this Guaranty shall be finally determined to be superseded, invalid, illegal or otherwise unenforceable pursuant to applicable law by any authority having jurisdiction, such determination shall not impair or otherwise affect the effectiveness, validity, legality or enforceability of the remaining provisions of this Guaranty, which shall be enforced as if the ineffective, invalid, illegal or otherwise unenforceable provision were deleted. Section 2.4. Collection. The Guarantor hereby agrees to pay, upon demand by the Holder, in lawful money of the United States of America, all of the Holder's reasonable costs and expenses of the enforcement of, and the collection under, this Guaranty, including, without limitation, the Holder's reasonable attorneys' fees and disbursements, in the event and to the extent that it becomes necessary for the Holder to enforce any of the provisions of this Guaranty. IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be executed and delivered as of the day and year first above written. Jeffrey E. Epstein 4 EFTA00312980 Schedule F Allocation of Purchase Price The Shares and the Beneficial Interest The Personal Property (see below) $19,332,500 $ 667,500 Personal Property One (1) Desk — Early Louis XIV $600,000 One (1) Louis XIV Painted Armchair $ 7,500 One (1) Mahogany Dining Table $ 20,000 Twelve (12) Dining Chairs $ 20,000 One (1) set Mahogany Dining Furniture $ 20,000 EFTA00312981 Schedule G Intentionally Omitted EFTA00312982 Exhibit H Assignment of Beneficial Interest — Attached EFTA00312983 ASSIGNMENT AND ASSUMPTION AGREEMENT KNOW ALL MEN BY THESE PRESENTS THAT: WHEREAS, pursuant to a certain Nominee Agreement dated as of August 24, 1989 by and between Leslie H. Wexner (the "Assignor"), as principal, and Nine East 71g Street Corporation, a New York corporation (the "Corporation"), as nominee (the "Nominee Agreement"), the Assignor is the owner of 100% of the beneficial interest in that certain real property which is known as, and located at, 9 East 71g Street, New York, NY, and is more fully described on Schedule A attached hereto, all improvements thereon, all fixtures thereto, and all appurtenances thereto (the "Real Property"), and the Corporation is the record holder of legal title to the Real Property; WHEREAS, pursuant to a certain Purchase and Sale Agreement, of even date herewith (the "Purchase and Sale Agreement"), by and between the Assignor, as the seller thereunder, and NES, LLC, a New York limited liability company (the "Assignee"), as the purchaser thereunder, the Assignee purchased from the Assignor, and the Assignor sold to the Assignee, all of the Assignor's right, title and interest in and to the Real Property, including, but not limited to, the Assignor's rights in and under the Nominee Agreement (the "Beneficial Interest"), together with all of the issued and outstanding shares of capital stock of the Corporation, with the intent and purpose that, upon the consummation of the transactions contemplated thereby, the Purchaser would acquire one hundred percent (100%) of the legal title to the Real Property (indirectly, by its EFTA00312984 acquisition of all of the issued and outstanding capital stock of the Corporation) and one hundred percent (100%) of the Beneficial Interest; WHEREAS, pursuant to Sections 4.2.1(f) and 4.2.2 of the Purchase and Sale Agreement, each of the Assignor and the Assignee has agreed to deliver at the Closing (as defined in the Purchase and Sale Agreement) a duly executed and notarized copy of this Assignment and Assumption Agreement; NOW, THEREFORE, The Assignor, for the consideration provided in the Purchase and Sale Agreement, does hereby grant, bargain, sell, convey, transfer, assign, set over and deliver unto the Assignee, its successors and assigns, the Beneficial Interest; TO HAVE AND TO HOLD the Beneficial Interest unto the Assignee, its successors and assigns forever, to the Assignee and its own use. The Assignor does hereby delegate, and, in consideration of the Assignor's transfer to the Assignee of the Beneficial Interest hereunder, the Assignee does hereby assume, all of the Assignor's duties and obligations under the Nominee Agreement from and after the date hereof, but not with respect to any duty or obligation thereunder which arises out of, or in connection with, or relates to, any acts or omissions which occurred, or circumstances which existed, prior to the date hereof (the "Assumed Obligations"). The 2 EFTA00312985 Assignee, for and in substitution of the Assignor, agrees to fully abide by, and comply with, all of the terms, conditions and provisions of the Nominee Agreement, and to indemnify, defend and hold harmless the Assignor from and against any and all losses, claims, actions, causes of action, damages, liabilities, charges, costs, fees and expenses (including, but not limited to, reasonable attorney's fees and disbursements) imposed upon, assessed against, incurred by, or resulting to, the Assignor, arising solely out of, or in connection with, or related solely to, the Assumed Obligations. The Assignor does hereby covenant and agree to execute any such further agreements, instruments and other documents, and to take any such further action, as the Assignee may request to effectuate the transfer of the Beneficial Interest to the Assignee. The execution and delivery by the parties hereto of this Assignment and Assumption Agreement are required pursuant to Sections 4.2.1(f) and 4.2.2 of the Purchase and Sale Agreement, and nothing provided herein shall in any way be deemed to supersede, modify, or amend any of the provisions, or relieve any party hereto from liability for his or its breach, of the Purchase and Sale Agreement, including, without limitation, a breach of his or its representations and warranties and indemnities thereunder. This Assignment and Assumption Agreement (a) shall be governed by, and construed in accordance with, the laws of the State of New York applicable to contracts executed and to be performed fully therein, without reference to its principles of conflicts 3 EFTA00312986 of law, and (b) may not be modified or amended except by a writing signed by the parties hereto. IN WITNESS WHEREOF, the Assignor and the Assignee have executed this Assignment and Assumption Agreement as of the day of November, 1998. Leslie H. Wexner NES, LLC By: Jeffrey E. Epstein Member STATE OF COUNTY OF ) ) ss.: ) On the day of November, 1998, before me personally came Leslie H. Wexner, known to me to be the person who is described in the foregoing document, and he did state that he executed the same. Notary Public 4 EFTA00312987 STATE OF ) ) ss.: COUNTY OF ) On the day of November, 1998, before me personally came Jeffrey E. Epstein, known to me personally, and he did state that he is a member of NES, LLC, a New York liability company (the "Company"), the entity described in the foregoing document, that he is authorized, for and on behalf of the Company, to execute the foregoing document, and that he did execute the same. Notary Public 5 EFTA00312988 Exhibit I Bill of Sale — Attached EFTA00312989 1OO—lima WAIL Exhibit I Juuu• wo.ni••••• inc. LAW 44A" I /LIM, nob) ail an by these 4resent≤, THAT LESLIE H. WEXNER part Y of the first part, for and in consideration of the stain of Six Hundred Sixty -Seven Thousat Five Hundred and 00/100 0667,500.001 Dollars, Info) money of the United States to him in hand paid, at or before the ensealing and delivery of that presents by NES, LLC part y of the second pan, the receipt whereof is hereby acknowledged has bargained and sold, and by these p do es grant and convey unto the said party of the second part, heirs, executors, administrators, successors and assigns all of the r t, title and interest in and to sone' property listed on liedule attached hereto ("P • "e n ) TO HAVE AND TO HOLD the note unto the said part y of the second part, its irL;s„ successors and assigns forever. AND he does for his heirs, executors and administretors, covenant and agree, to and with the said party of the second part, to warrant and defend the sale of the aforesaid Property hereby sold unto the said party of the second part, its Inas,••••rm atataxis, successors and assigns, against all and every person and persons whomsoever. IN WITNESS WHEREOF, the party of the first part hm set his hand and seal or caused these presents to be signed by its proper corporate officers and caused its proper corporate seal to he hereto affixed, this Signed, Sealed and Delivered 1 in the Presence of day of 19 EFTA00312990 SCHEDULE OF THE FOREGOING BILL OF SALE Property One (1) Louis XIV Painted Armchair One (1) Mahogany Dining Table Twelve (12) Dining Chairs One (1) set Mahogany Dining Furniture One (1) Desk - Early Louis XIV EFTA00312991 STATE OF COUNTY OF LESLIE H. WEXNER being duly sworn, deposes and says that New Albany, OH 43054 1St. : he resides at One Whitebarn Road, That he is the same person who executed the within bill of sale. That he is the sole and absolute owner of the property described in said bill of sale, and ha full right to sell and transfer the same. That the said property, and each and every part thereof, is free and clear of any liens, mortgages, debts or other encumbrances of whatsoever kind or nature except, N/A have Tb A ; not-dmo--emr- petition in bankruptcy or arrangement proceedingsebeen bled by or against h its ; nor nib he taken advantage of any law relating to insolvency. That this affidavit is made for the purpose and with the intent of inducing NES, LLC to purchase the property described in said bill of sale, knowing that it -1r will rely thereon and pay a good and valuable consideration therefor. Sworn to before me this day of STATE OF COUNTY OF 19 • LESLIE R. WEXNER , being duly sworn deposes and says: That be is of a corporation organized under the laws of the State of , and having its principal office at That the corporation is now the sole owner of all of the goods and chattels described and more specifically enumerated in the schedule hereto annexed and made part of the foregoing bill of sale. That your deponent states that there are no mortgages, liens, conditional sales agreement or other encumbrances of whatever nature or description affecting the said goods and chattels set forth in the foregoing schedule and that they are absolutely free and clear thereof, except That the corporation is not indebted to any one and has no creditors except That there are no actions pending against the corporation in any court; nor are there any replevin', judgments or executions outstanding against the corporation now in force; nor has any petition in bank- ruptcy or arrangement proceedings been filed by or against the corporation; nor has the corporation taken advantage of any law relating to insolvency. That this affidavit is made for the express purpose and with the intent of inducing to purchase the property set forth and described in the foregoing bill of sale, knowing full well that h will rely upon this affidavit and pay a good and valuable consideration. Sworn to before me this day of 19 . . . . . . . . . . - • • ^ EFTA00312992 STATE OF COUNTY OF On the day of before me came LESLIE H. WEXNER nineteen hundred and to ne known and known to me to be the individual described in, and who executed, the foregoing instrument, and acknowledged to me that he executed the same. STATE OF COUNTY OF On the day of before me came being by me duly sworn, did depose and say that that he is the of nineteen hundred and he resides at No. to me known, who, the corporation described in, and which executed, the foregoing instrument: that he knows the seal of said corporation; that the seal affixed to said instrument is such corporate seal: that it was so affixed by order of the board of of said corporation; and that be signed h name thereto by like order. EFTA00312993