Loan Purchase And Sale Agreement

Loan Purchase and Sale Agreement



                                                                  Exhibit 10.4



                           LOAN PURCHASE AND SALE AGREEMENT


     THIS LOAN PURCHASE AND SALE AGREEMENT (this "Agreement") dated as of March
13, 1998, is made by and between AETNA LIFE INSURANCE COMPANY, a Connecticut
corporation (hereinafter "Seller"), and CONSTELLATION REAL ESTATE, INC., a
Maryland corporation, or its assigns as permitted by this Agreement
("Purchaser").

                                       RECITALS

     A.   On or about June 9, 1994 but effective as of July 1, 1993, Seller
consolidated, amended and restated the terms of a loan to Airport Square Limited
Partnership, a Maryland limited partnership (the "Borrower"), in the original
principal amount of Sixty Million Two Hundred Seven Thousand, Six Hundred
Ninety-Four and 80/100 Dollars ($60,207,694.80) (as further modified, restated,
renewed or extended from time to time, the "Loan").

     B.   The Loan is evidenced by, among other things, (i) a Consolidated,
Amended and Restated Promissory Note dated as of July 1, 1993, from the Borrower
to the order of Seller, in the original principal amount of Sixty Million Two
Hundred Seven Thousand, Six Hundred Ninety-Four and 80/100 Dollars
($60,207,694.80) (hereinafter the "Note"), and (ii) a Master Restructuring
Agreement dated as of July 1, 1993 executed by and between, among others, the
Seller and the Borrower.

     C.   The Loan is secured by, inter alia,  the twelve (12) Indemnity Deed of
Trust and Security Agreements dated as of July 1, 1993, executed and delivered
by the Guarantors (as hereinafter defined), as grantors to Cindi E. Cohen and
Martin J. Hutt, as Trustees, duly recorded in the land records of Anne Arundel
County, Maryland, as well as Deeds of Trust and Security Agreements, all as more
particularly described on Exhibit A attached hereto and made a part hereof
(hereinafter the "Deeds of Trust").

     D.   The Borrower's obligations under the Loan were guaranteed by the
Guarantors indicated on Exhibit B attached hereto and made a part hereof
(hereinafter collectively the "Guarantors") pursuant to the Guaranties of
Payment indicated on Exhibit B, all dated July 1, 1993 (hereinafter the
"Guaranties").

     E.   The Borrower, Seller and Latimer & Buck, Inc. entered into a Reserve
Escrow Agreement as of July 1, 1993 (the "Reserve Escrow Agreement"), pursuant
to which Borrower has made deposits into an escrow account established
thereunder (the "Reserve Escrow").  The amount of funds in the Reserve Escrow,
less all sums payable from the Reserve Escrow for invoices submitted by the
Borrower and/or the Guarantors under the Reserve Escrow Agreement, is
hereinafter referred to as the "Reserve Escrow Amount."








     F.   The Note, the Deeds of Trust, the Guaranties, the Reserve Escrow
Agreement, the Master Restructuring Agreement and all other documents executed
by or on behalf of the Borrower or the Guarantors in connection with the Loan,
including without limitation, those which are identified on Exhibit C attached
hereto, are collectively referred to herein as the "Loan Documents".

     G.   In connection with the Loan, Seller acquired Parcel I and Parcel V (as
described in the Title Policy referred to hereinafter), which parcels have been
leased to Airport Square II Company and Airport Square XI Company, respectively
(collectively, the "Reversionary Interests").

     H.   Under Paragraph 9(b) of the Note, the Borrower may exclude from the
Properties to be sold to the holder of the Note under Paragraph 9(a) thereof the
"Hardee's Property" and the "900 Andover Road Property" (as defined in the
Master Restructuring Agreement) [collectively, the "Excluded Properties" and
individually, an "Excluded Property"].  The Purchase Price to be paid by the
Purchaser to the Seller hereunder has been premised on the following
assumptions:  (i) the Borrower will in fact exclude the Excluded Properties from
the sale to the holder of the Note; (ii) the Agreed Value of each of the
Excluded Properties equals $400,000; and (iii) the Senior Mortgage Debt (as
defined in the Master Restructuring Agreement) is equal to $100,000.  If any of
these assumptions were to change, the Purchase Price shall be adjusted, as
hereinafter set forth.

     I.   Subject to the terms and conditions set forth herein, Purchaser has
agreed to buy and Seller has agreed to sell all of Seller's rights, title and
interest in and to the Loan, the Loan Documents and the Reversionary Interests.

     NOW THEREFORE, in consideration of these premises, the terms and conditions
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby covenant and
agree as follows:    
   
     1.   Purchase of Loan.  Seller hereby agrees to sell to Purchaser, and
Purchaser hereby agrees to purchase from Seller, all of Seller's right, title
and interest in the Loan and the Loan Documents, at the Closing (as hereinafter
defined), subject to the terms and conditions set forth in this Agreement.  The
closing of the sale of the Loan and the Loan Documents (the "Closing") shall
occur on the later to occur of (a) five (5) days after the date the owners of
the property encumbered by the Deeds of Trust (the "Property") enter into a
formal contract of sale with the Seller for the purchase of the Property by the
Seller or its assigns, which contract is acceptable to Purchaser in all respects
in its discretion (the "Property Purchase Agreement") or (b) April 10, 1998;
provided, however, in no event later than May 15, 1998 (the "Closing Date").  At
the Closing, Seller shall sell, assign and transfer to Purchaser, all of
Seller's right, title and interest in and to the Loan, the Loan 





                                          2




Documents, the Reversionary Interests, the Property Purchase Agreement and all
existing and future claims arising out of the Loan against the Borrower, the
Guarantors or any other person liable for repayment of the Loan or the
performance of Borrower's obligations thereunder.  The Closing shall occur at
Purchaser's offices in Columbia, Maryland or, at Seller's option, pursuant to an
escrowed closing under escrow instructions consistent with the terms of this
Agreement and otherwise mutually acceptable to Seller and Purchaser.  Prior to
the Closing, Seller may not modify the terms of the Loan, the Reversionary
Interests or the Property Purchase Agreement (once approved by the Purchaser
pursuant to Section 5(e) hereof) in any manner without the prior written consent
of the Purchaser.  

     2.   Purchase Price.  The purchase price to be paid to the Seller by the
Purchaser for the Loan (the "Purchase Price") shall equal $65,300,000 plus (a)
$.20 for each dollar, if any, by which the Reserve Escrow Amount exceeds
$1,400,000 at the Closing, plus (b) if the Excluded Properties are excluded from
the Property Purchase Agreement, $1.00 for each dollar by which the Senior
Mortgage Debt is less than $100,000 as of the Closing, less (c) all principal
payments and all other payments which would ordinarily be applied to principal
under the terms of the Loan Documents (including without limitation, insurance
proceeds, condemnation proceeds and prepayments) received by the Seller in
connection with the Loan between the date hereof and the Closing Date, less (d)
if the Reserve Escrow Amount is below $1,400,000 at the Closing, then less $.20
for each of the first 904,795 dollars below $1,400,000 and then less $.80 for
each dollar below $495,205, and less (e) if either or both of the Excluded
Properties are excluded from the Property Purchase Agreement, $1.00 for each
dollar by which the Agreed Value of an Excluded Property (disregarding the
Senior Mortgage Debt) contained in the Property Purchase Agreement is less than
$400,000 and $1.00 for each dollar by which the Senior Mortgage Debt as of the
Closing is greater than $100,000.  The Purchase Price shall be paid to Seller at
the Closing by wire transfer of immediately available funds pursuant to the
wiring instructions in the form attached hereto as Exhibit D and made a part
hereof.  All payments or credits (other than the Purchase Price) received by
Seller in connection with the Loan on or after the Closing Date shall be held by
Seller in trust for Purchaser and promptly remitted to Purchaser.  

     3.   Deposit.  The sum of $1,000,000 has been paid by Purchaser upon the
execution of this Agreement as an earnest money deposit to be either applied
against the Purchase Price at Closing or otherwise applied pursuant to the terms
of this Agreement.  The aforesaid earnest money deposit shall be held in escrow
by Commonwealth Land Title Insurance Company as escrow agent (the "Escrow
Agent"), and shall be deposited in an interest-bearing escrow account designated
by Purchaser.  Such deposit, and all interest earned thereon, is referred to as
the "Deposit".    

     4.   Study Period.  The Purchaser's obligations hereunder shall be
contingent upon Purchaser's satisfaction with the results of the environmental
reports, structural reports, 




                                          3




surveys, title reports and title commitments, relating to the Property and the
Loan (the "Studies") deemed necessary or desirable by the Purchaser in the
Purchaser's sole and absolute discretion.  Seller hereby agrees that Purchaser
shall have a period of thirty (30) days (the "Study Period") from the date of
this Agreement in which to make such Studies as Purchaser deems necessary or
appropriate in its sole discretion.  Seller hereby permits Purchaser and its
agents and hereby authorizes Purchaser and such agents, as representatives of
the Seller,  to have access to the Property (to the extent permitted under, and
subject to the conditions of, the Loan Documents) and to communicate with
Borrower, for the purpose of conducting the Studies.  Purchaser shall indemnify
Seller for any and all liability suffered by Seller which was caused by
Purchaser, its agents and employees, in conducting the Studies, which
indemnification shall survive the termination of this Agreement.  Seller will
make available to Purchaser and its representatives Seller's books and records
relating to the Loan and the Property.  In the event Purchaser determines, based
on the results of such Studies, that Purchaser does not wish to proceed with
this transaction, Purchaser shall have the right and option to terminate this
Agreement upon written notice sent to Seller prior to the end of the Study
Period, in which case neither party shall have any further liability to the
other and the Deposit shall be returned to Purchaser pursuant to Section 3. 
Should Purchaser elect to terminate this Agreement, Purchaser shall promptly
thereafter provide Seller with copies of reports and studies prepared in
connection with the Studies (with no representatives or warranties with respect
thereto). 

     5.   Conditions to Closing.  Each and every obligation of Purchaser to be
performed at the Closing shall be subject to the satisfaction of the following
conditions: 

          (a)  No suit, action or other proceeding shall have been instituted or
threatened before any court or administrative agency which could result in an
order or decree enjoining the consummation of the transactions contemplated by
this Agreement or the creation of any lien or easement on any portion of the
Property. 

          (b)  Title to the Property and the Reversionary Interests shall be
good and marketable, free and clear of any encumbrances, claims, charges, liens,
leases and judgments other than those matters listed on Schedule B of the title
commitment  issued to Purchaser by Commonwealth Land Title Insurance Company, a
copy of which is attached hereto as Exhibit G, and shall be insurable at
standard rates by such title company. 

          (c)  There shall have been no material damage or material destruction
to the Property or condemnation pending or threatened against the Property;
provided, however, that Purchaser shall have ten (10) days after receiving
written notice from the Seller of such damage, destruction or condemnation in
which to decide whether to waive this condition precedent or terminate this
Agreement as set forth below. 


                                          4




          (d)  The representations and warranties of Seller under this Agreement
remain true and correct, and Seller shall have performed all of its obligations
under this Agreement. 

          (e)  The Property Purchase Agreement shall have been executed by all
parties thereto no later than May 13, 1998, and Purchaser shall have notified
Seller no later than two (2) business days thereafter that such Property
Purchase Agreement is acceptable to Purchaser.

          If any condition precedent to Closing set forth in this Section 5 is
not satisfied prior to the Closing Date, Purchaser may either (i) waive such
condition precedent, or (ii) elect to terminate this Agreement by written notice
to Seller and upon such notice the Deposit shall be immediately paid to
Purchaser, this Agreement shall then be of no further force and effect and
neither party shall have any obligations or liabilities to the other.  In no
event can Purchaser force Seller to cure defects or satisfy conditions
precedent, other than those set forth in the foregoing subparagraph (d).

     6.   Representations and Warranties by Seller.  Seller represents and
warrants to Purchaser as follows:

          (a)  Seller is the holder and owner of the Note.

          (b)  Seller is duly authorized and empowered to enter into this 
Agreement and to sell the Loan, the Loan Documents and the Reversionary 
Interests.

          (c)  As of the date of this Agreement, the amount of advanced and 
unpaid principal owing by the Borrower on the Loan is Sixty Million Two 
Hundred Seven Thousand Six Hundred-Ninety-Four 80/100 Dollars 
($60,207,694.80). 

          (d)  As of March 6, 1998, the accrued but unpaid interest at the
Note's stated rate of interest is Fifty-One Thousand Three Hundred Seventy-Eight
and 84/100 Dollars ($51,378.84) and continues to accrue at a per diem rate of
Ten Thousand Two Hundred Seventy-Five and 77/100 Dollars ($10,275.77). 

          (e)  Seller has not transferred, assigned, encumbered or 
hypothecated, and there is no presently effective agreement to transfer, 
assign, encumber  or hypothecate all or any part of its interest in the Loan, 
the Loan Documents or the Reversionary Interests (except, as to the 
Reversionary Interests, only, for the obligation of Seller to convey the 
Reversionary Interests to Borrower upon repayment of the Loan in accordance 
with the Master Restructuring Agreement).

                                          5



          (f)  Seller is not a "Foreign Person" within the meaning of the 
Federal Foreign Investment in Real Estate Tax Act, as amended, and 
consequently is not subject to withholding in this transaction.

          (g)  Seller (or its agent under the Reserve Escrow Agreement) holds 
the following monies escrowed by the Borrower or Guarantors in connection 
with the Loan: $1,896,771.

          (h)  Seller has delivered all of the Loan Documents and, to the 
extent Seller possesses the same, has supplied the Purchaser with copies of 
the current rent roll, leases, title, surveys, insurance information and 
certificates, environmental studies, structural and engineering studies, 
opinions of Borrower's (and parties related to the Borrower) counsel, and 
other material information relating to the Loan to the extent such  material 
information is customarily delivered in loan purchase transactions similar to 
the transaction contemplated hereby. 

          (i)  Seller is not in default under the Loan in any manner which 
would materially impair the Purchaser's rights to purchase the Property or 
which would, subsequent to Closing, materially impact Purchaser's rights 
under the Loan Documents, and Seller has no actual knowledge of, nor has 
Seller received notice of, any default of Seller under the Loan Documents.  
For the purposes hereof, "actual knowledge" shall mean the knowledge of those 
individuals currently employed by the Seller involved in the administration 
of the Loan. Seller further represents and warrants that Borrower is not 
currently in default of any payment obligations under the Loan Documents.

          (j)  Seller shall deliver to Purchaser copies of all written 
notices and communications received from Borrower or its agents prior to 
Closing, within 3 days of receipt thereof by Seller.  Seller will promptly 
notify Purchaser of the substance of all oral communications between Seller 
and Borrower occurring prior to Closing.  

          (k)  The copy of the notice from Borrower to Seller dated December 
23, 1997 attached hereto as Exhibit E-1, and the copy of the notice from 
Seller to Borrower accepting the offer to acquire the Property (the 
"Acceptance"), attached hereto as Exhibit E-2, are true and complete and such 
notices have not been modified in any respect.  Seller shall not change the 
Acceptance nor make any other agreement with Borrower with respect to the 
acquisition of the Property, other than the Property Purchase Agreement which 
must be acceptable to the Purchaser in all respects.  If such Property 
Purchase Agreement is unacceptable to the Purchaser for any reason, Purchaser 
may terminate this Agreement by giving written notice to the Seller within 
two (2) business days after receiving a copy of such executed Property 
Purchase Agreement between the Seller and the Borrower and/or its affiliates, 
in which case of termination Purchaser shall have no further obligations 
hereunder and the Deposit shall be immediately paid to Purchaser.

                                          6




          (l)  Prior to the Closing, Seller shall administer the Loan in the 
ordinary course of business and in accordance with the terms and conditions 
of the Loan Documents.  

          (m)  The Note and the other Loan Documents are being sold in "AS 
IS" condition on a "WHERE IS" basis and "WITH ALL FAULTS" as of the date of 
this Agreement.  Except as specifically set forth in this Section 6, Seller 
makes no warranties or representations of any type, kind, character or 
nature, whether expressed or implied, statutory or otherwise (the warranties 
provided for in Section 3-416 of the Uniform Commercial Code in effect in 
Maryland being specifically negated), in fact or in law, or any warranties of 
merchantability or fitness for a particular purpose with respect to any term 
or condition of the Note, the Deeds of Trust, the Guaranties or any of the 
other Loan Documents, or with respect to the Property.  Without in any way 
limiting the generality of the foregoing, Seller has not made, does not make 
or undertake, and expressly disclaims any representation, warranty or 
obligation, expressed or implied, as to any characteristic or other matter 
affecting or related to the Property, including, without limitation, the 
presence of any toxic or hazardous waste or substance in the Property or any 
other environmental or other matters related to the physical condition of the 
Property (both surface and subsurface).  Purchaser hereby waives any such 
representation, warranty or obligation, expressed or implied, related to any 
such characteristic or matter.  Further, except as specifically set forth in 
this Section 6, Seller makes no representation or warranty, whether expressed 
or implied, and assumes no responsibility with respect to (i) the 
enforceability, collectibility or value of the Note or the other Loan 
Documents, (ii) the creditworthiness or financial condition of Borrower or 
the ability of Borrower or any other parties or persons to perform their 
respective obligations under the Loan Documents, (iii) the due execution, 
validity, sufficiency, or the perfection or priority of any liens or security 
interests securing or appearing to secure or relating to the Note or the 
other Loan Documents or with respect to any Property covered by such liens, 
(iv) the condition of the Note or the value or income potential of the Note 
or any collateral included in the Loan Documents, (v) rights of offset, 
deductions, negotiability, or holder in due course status, the accuracy or 
completeness of the matters disclosed, represented or warranted by any party 
in the Note or any of the other Loan Documents, (vi) the adequacy of the 
collateral described in the Loan Documents, or (vii) the existence or 
nonexistence of any default or event of default under the Note or any of the 
other Loan Documents.  Seller shall have no responsibility for the financial 
condition of Borrower or for the ability of Borrower to perform its 
obligations under the Loan Documents.  After the Closing Date, Purchaser 
shall have no recourse against Seller arising out of this Agreement, the 
Note, the Loan Documents or the transactions contemplated hereby or thereby, 
except to the extent such recourse is based upon any inaccuracy in any of the 
representations or warranties of Seller set forth in this Section 6.  Seller 
shall not under any circumstances have any duty to repurchase the Note.     
               
     7.   Representations and Warranties by Purchaser.  Purchaser represents 
and warrants to Seller as follows:

                                          7


          (a)  Purchaser is duly authorized and empowered to enter into this 
Agreement, to purchase the Loan and the Loan Documents and to perform its 
other obligations under this Agreement;

          (b)  Purchaser is an "Accredited Investor" as defined in Section 
2(15) of the Securities Act of 1933, is a sophisticated investor; and 

          (c)  Purchaser is not engaging in this transaction directly on 
behalf of an "employee benefit plan" as defined in the Employee Retirement 
Income Security Act of 1974, as amended ("ERISA"), unless (i) this 
transaction will not result in a "prohibited transaction" as defined in 
Section 406 of ERISA or Section 4975 of the Internal Revenue Code of 1986, as 
amended, or (ii) Purchaser may engage in this transaction by virtue of an 
exemption from such prohibited transactions.  

     8.   Execution of Documents of Transfer.  At the Closing, Seller shall 
endorse the Note as follows:

          "Pay to the order of ______________________________ without
          recourse, representation or warranty, except as provided in
          that certain Loan Purchase and Sale Agreement dated
          ___________, 1998 by and between Constellation Real Estate,
          Inc. and Aetna Life Insurance Company." 



          AETNA LIFE INSURANCE COMPANY 

          By:                                (SEAL)
              ------------------------------
          Name: 
               -----------------------------
          Title:
                ----------------------------
          Date:
                ----------------------------

     Seller also shall execute and deliver to Purchaser at the Closing (a) 
assignments of the Deed of Trust and other Loan Documents in substantially 
the forms attached hereto as Exhibits "F-1", "F-2" and "F-3", and an 
assignment of the Property Purchase Agreement, (b) any and all applicable 
UCC-3 Assignments for recordation among the records of the appropriate 
recording offices, and (c) a special warranty deed in recordable form 
conveying to Purchaser the Seller's right, title and interest in Parcel I and 
Parcel V (as described in the Title Policy) free and clear of all 
encumbrances except the ground leases to Airport Square II Company and 
Airport Square XI Company, respectively, and all matters of record. 

                                          8




     9.   Title Insurance Policy.  The priority of the lien of the Deeds of 
Trust, as of the date of issuance of the policy, is insured by Commonwealth 
Land Title Insurance Company, Policy No. 1932419-L (the "Title Policy").  
Purchaser shall bear full responsibility for and shall pay all costs 
associated with transferring and obtaining any endorsements to the Title 
Policy in connection with this transaction.  

     10.  Deliveries.  At the Closing, Seller shall deliver to Purchaser all 
executed originals of the Loan Documents, including without limitation those 
identified on Exhibit C hereto, and Purchaser shall assume the obligations of 
the Seller under the Loan Documents and the Property Purchase Agreement and 
agrees to indemnify Seller for damages Seller incurs subsequent to the 
Closing due to Purchaser's breach thereunder.

     11.  Attorney's Fees and Expenses.  Each party shall bear the cost of 
its own attorneys' fees incurred in connection with the preparation of this 
Agreement and consummation of the transactions described herein.  Purchaser 
shall bear the cost of all recordation fees and/or transfer taxes (other than 
Seller's income or similar taxes) associated with selling the Loan, 
including, without limitation, recording an assignment of the Deed of Trust, 
assignment or termination of financing statements, and any fees and/or taxes 
associated with other transfer documents which are to be recorded in 
connection with the transactions contemplated hereby.

     12.  Default and Indemnification.  

          (a)  If all conditions and other events precedent to Purchaser's 
obligation to consummate the transactions contemplated by this Agreement have 
been satisfied or waived, but Purchaser nevertheless fails, refuses or is 
unable to consummate the purchase contemplated by this Agreement, then 
Seller's sole remedy shall be to retain the Deposit as Seller's full 
liquidated damages and terminate this Agreement, in which case all parties 
hereto shall be released of all further liability hereunder, and this 
Agreement shall become null and void and of no further force and effect, 
other than those indemnities contained in Sections 4 and 15 which, by their 
terms, survive the termination of this Agreement.  In no event shall Seller 
have the right to bring suit for specific performance and/or for monetary 
damages for default against Purchaser or any other party. 

          (b)  If Seller fails, refuses or is unable to consummate the 
transactions contemplated under this Agreement, then Purchaser shall either 
have the right to (i) bring suit for specific performance or (ii) terminate 
this Agreement and receive a return of its Deposit. 

          (c)  Seller agrees to indemnify and hold Purchaser harmless from 
and against any and all liabilities, expenses, costs (including reasonable 
attorneys' fees) and claims whatsoever arising from any breach or default by 
Seller of any of its 

                                          9



representations, warranties, covenants and obligations described in this
Agreement.  This Section 12 shall survive the Closing for 6 months.
               
     13.  Notices.  Any notice required or permitted by or in connection with 
this Agreement, without implying the obligation to provide any such notice, 
shall be in writing at the appropriate addresses set forth below or to such 
other addresses as may be hereafter specified by written notice by Seller or 
Purchaser.  Any such notice shall be deemed to be effective one (1) day after 
dispatch if sent by overnight delivery, express mail or federal express or 
three (3) days after mailing if set by first class mail with postage prepaid. 
 All notices shall be considered to be effective upon receipt if accomplished 
by hand delivery or by facsimile.

                    If to Seller:            

                    Aetna Life Insurance Company 
                    c/o Legg Mason Real Estate Services 
                    2330 W. Joppa Road, Suite 375
                    Lutherville, Maryland 21093
                    Attn:  Timothy W. Greisman 

                    and

                    Aetna Life Insurance Company 
                    Real Estate Investments
                    151 Farmington Avenue
                    Hartford, Connecticut  06156
                    Attn:  Mr. Michael E. Hussey


                    With a copy to: 

                    Hebb & Gitlin
                    One State Street
                    Hartford, Connecticut  06103
                    Attn:  R. Jeffrey Smith, Esq.




                                          10


                    If to the Purchaser:

                    Constellation Real Estate, Inc. 
                    8815 Centre Park Drive
                    Columbia, Maryland 21045
                    Attn:  Randall M. Griffin, President

                    With copies to:

                    John Harris Gurley, Esq.
                    Constellation Real Estate, Inc. 
                    8815 Centre Park Drive
                    Columbia, Maryland 21045

                         and

                    Richard E. Levine, Esquire
                    Miles & Stockbridge P.C.
                    10 Light Street
                    Baltimore, Maryland 21202


      Whenever any date or the expiration of any period specified under this 
Agreement falls on a day other than a business day, then such date or period 
shall be deemed extended to the next succeeding business day.

      14.  Choice of Law.  The laws of the State of Maryland shall govern the 
rights and obligations of the parties to this Agreement, and the 
interpretation and construction and enforceability thereof, and any and all 
issues relating to the transactions contemplated herein.  

     15.  Broker Fees.  Each party represents and warrants to the other that, 
other than the Seller dealing with Legg Mason Real Estate Services ("Legg 
Mason"), it has dealt with no other broker, investment broker or agent in 
connection with the sale of the Loan and that, other than the Seller's 
obligations to Legg Mason, no commissions, finders fees or other such 
payments are due any broker as a result of the conduct of such party.  Seller 
shall solely be responsible for all brokerage commissions and other fees, 
charges and costs due to Legg Mason.  Purchaser and Seller hereby indemnify 
and agree to hold the other harmless from and against any and all loss, 
liability, cost or expense (including without limitation, court cost and 
reasonable attorneys' fees and expenses) that the one may suffer or sustain 
should the foregoing representations and warranties of the other prove 
inaccurate.  The 

                                          11



foregoing indemnities shall survive the closing of this transaction and/or 
any termination of this Agreement.

     16.  Assignment.  This Agreement may be assigned by Purchaser without 
the written consent of Seller, provided that (a) the Purchaser shall remain 
liable to the extent of its obligations hereunder, (b) Seller may continue to 
work with the Purchaser in consummating the transactions contemplated hereby, 
and (c) the representation and warranty set forth in Section 7(c) remains 
true with respect to any such assignee.

     17.  Final Agreement.  This Agreement (including the exhibits hereto) 
contain the final and entire agreement and understanding of the parties, and 
any terms and conditions not set forth in this Agreement are not a part of 
this Agreement and the understanding of the parties hereto and may not be 
contradicted by evidence of prior, contemporaneous or subsequent oral 
agreements of the parties.  No variation, modification, or changes hereof 
shall be binding on either party hereto unless set forth in a document 
executed by both parties.  

     18.  Further Assurances.  Seller will make, execute and deliver to 
Purchaser any and all further instruments, certificates or other documents as 
may be reasonably necessary in order to effectuate or complete the 
transactions contemplated hereby.

     19.  Severability.  If any paragraph, section, sentence, clause or 
phrase contained in this Agreement shall become illegal, null or void or 
against public policy, for any reason, or shall be held by any court of 
competent jurisdiction to be illegal, null or void or against public policy, 
the remaining paragraphs, sections, sentences, clauses or phrases contained 
in this Agreement shall not be affected thereby to the extent that the intent 
of the parties hereto can be carried out absent such provision.

     20.  Counterparts.  This Agreement may be executed in separate 
counterparts, each of which shall be an enforceable document, but all of 
which together shall constitute one and the same document.

     21.  Time of the Essence.  Time is of the essence in the execution and 
performance of this Agreement and each provision hereof.

     22.  Rule of Construction.  The parties acknowledge that each party and 
its counsel have reviewed this Agreement and the parties hereby agree that 
the normal rule of construction to the effect that any ambiguities are to be 
resolved against the drafting party shall not be employed in the 
interpretation of this Agreement or any amendments or exhibits hereto.

                                          12




     23.  Survival.  The terms and provisions of this Agreement shall survive 
Closing. 

     24.  Escrow Agent.  

          (a)  In the event that a dispute exists with respect to the 
Deposit, the Escrow Agent shall (a) continue to hold the Deposit except as 
otherwise provided in (i) instructions signed by Seller and Purchaser, or 
(ii) a certified copy of a non-appealable order or decree of a court of 
competent jurisdiction with respect to the matter of releasing the Deposit, 
or (b) upon written notice by the Escrow Agent to Seller and Purchaser, 
deposit the Deposit with a court selected by the Escrow Agent, in which case 
all liability and responsibility of the Escrow Agent shall thereupon 
terminate. 

          (b)  The duties of the Escrow Agent are purely ministerial in 
nature and the Escrow Agent shall not be liable for any damage, liability or 
loss arising out of or in connection with its services rendered pursuant to 
this Agreement, and Seller and Purchaser hereby release the Escrow Agent from 
any act done or omitted to be done by the Escrow Agent in the performance of 
its duties hereunder, except for misconduct or fraud by Escrow Agent.  If the 
Escrow Agent shall pay or incur any liability on account of this Agreement or 
on account of being made a party to any litigation as a result of this 
Agreement, Seller and Purchaser jointly and severally shall on demand pay to 
the Escrow Agent, with interest thereon, such payments made or liabilities 
incurred by the Escrow Agent, together with its expenses, including 
reasonable attorney's fees.  Seller and Purchaser jointly and severally shall 
indemnify and hold the Escrow Agent harmless of and from any and all payments 
made or liabilities incurred by the Escrow Agent for any reason whatsoever as 
a result of this Agreement, except for misconduct or fraud by Escrow Agent.  
The Escrow Agent shall not be required to advance or pay out any money on 
account of this Agreement or to prosecute or defend any legal proceeding 
unless it shall be furnished with funds sufficient therefor by Seller or 
Purchaser or be indemnified to its satisfaction in respect thereto. 

          (c)  Seller and Purchaser reserve the right, at any time and from 
time to time, to mutually substitute a new escrow agent in place of the 
Escrow Agent. 

          (d)  The Escrow Agent may resign as escrow agent under this 
Agreement, provided that Seller and Purchaser shall have mutually selected a 
new escrow agent. 

                                          13



     IN WITNESS WHEREOF, this Agreement is executed under seal and 
is effective on the date first above written.  

                                   "SELLER"

WITNESS:                           AETNA LIFE INSURANCE COMPANY  


/s/ Michael E. Hussey                  By: /s/  Peter Atwood    (SEAL)
- ---------------------                  -------------------
                                   Name:    Peter Atwood
                                   Title:   Vice President

                                   "PURCHASER"

WITNESS:                           CONSTELLATION REAL ESTATE, INC.



/s/ Karen M. Singer                    By:  /s/ Roger A. Waesche, Jr.   (SEAL)
- -------------------                        --------------------------
                                   Name:  Roger A Waesche, Jr.  
                                   Title: Senior Vice President



                                          14



                                       JOINDER


     Commonwealth Land Title Insurance Company joins herein for the purpose 
of (a) acknowledging receipt of the Deposit, and (b) agreeing to administer 
the Deposit in accordance with the terms of this Agreement.

                                   COMMONWEALTH LAND TITLE            
                                   INSURANCE COMPANY 


                                   By: /s/    John Franetovich      (SEAL)
                                       --------------------------
                                   Name:  John Franetovich
                                   Title: Commercial Title Officer  


E7381901.LON
9788
03/12/98




                                          15

                                    EXHIBITS TO 
                          LOAN PURCHASE AND SALE AGREEMENT




A        -    Title Insurance Policy, which lists the Deeds of Trust

B        -    Guarantors and Guaranties

C        -    List of Loan Documents

D        -    Wiring Instructions

E-1      -    Notice from Borrower to Seller

E-2      -    Acceptance

F-1      -    Form of Assignment of Deed of Trust

F-2      -    Form of Assignment of Assignment of Leases

F-3      -    Form of Assignment of Loan Documents

G        -    Permitted Encumbrances



                                         



                                      EXHIBIT C

                                LIST OF LOAN DOCUMENTS

                                    DOCUMENT NAME


1.   Note (as defined in this Agreement), properly endorsed to the
     Purchaser, and all notes consolidated thereby, as set forth in the
     Note and the Master Restructuring Agreement, together with any and all
     modifications, extensions, renewals or restatements thereof

2.   Deeds of Trust (as defined in this Agreement)

3.   Assignments of Rents (as listed on Exhibit B-2 of the Master
     Restructuring Agreement) together with all other Assignments of Rents
     from the Guarantors 

4.   All UCC-1 and UCC-3 Statements executed in connection with the Loan,
     properly assigned to the Purchaser 

5.   Title Policy (as defined in this Agreement)

6.   All surveys done in connection with the Loan 

7.   Guaranties (as defined in this Agreement), together with Original
     Guaranties (as defined in, and set forth on Exhibit B of, the Master
     Restructuring Agreement) 

8.   Reserve Escrow Agreement (as defined in this Agreement)