Credits and Prorations. (a) The following items shall be apportioned with respect to each Property, on a Property-by-Property basis, as of 11:59 p.m. on the day immediately preceding the date of the First Closing, the Second Closing or the Bay Park Closing, as applicable, on the basis of the actual number of days of the month which shall have elapsed as of the applicable Closing date and based upon the actual number of days in the month and a 365-day year and shall be set forth on a proration schedule prepared by Sellers and submitted to Buyer for its review and approval at least five (5) Business Days prior to the applicable Closing: (i) scheduled rents from and including the date of Closing through the end of the month in which Closing occurs, (the term “rents” as used in this Agreement includes all payments due and payable by tenants under the Leases, including, without limitation, fixed rents, additional rents, percentage rents, escalation payments, and payments on account of real estate taxes, common area maintenance and other operating expenses), subject to the provisions of Sections 3.4(b)(viii) and 3.4(b)(ix) below; (ii) all taxes, assessments and other impositions (including ad valorem and other real estate taxes, personal property taxes, water rates and sewer rents) assessed, imposed or charged upon or with respect to each Property or any component thereof (collectively, “Impositions”), in accordance with the provisions of Sections 3.4(b)(ii) below; (iii) all amounts payable under the Contracts; (iv) gas, electricity and other utility charges (if any) for which each Seller is liable, such charges to be apportioned at Closing on the basis of the most recent meter reading occurring prior to Closing or, if unmetered, on the basis of a current xxxx for each such utility; (v) permit, license and inspection fees, if any, on the basis of the calendar year for which levied; (vi) fuel, if any, at the cost per gallon most recently charged to each Seller, based on the supplier’s measurements thereof, plus sales tax thereon, which measurements shall be given by Sellers to Buyer as close to the applicable closing date as is reasonably practicable, and which, absent manifest error, shall be conclusive and binding on Sellers and Buyer; (vii) deposits on account with any utility company servicing a Property to the extent transferred to Buyer shall not be apportioned, but Sellers shall receive a credit in the full amount thereof, including accrued interest, if any; and (viii) any other operating expenses or other items pertaining to a Property which are customarily prorated between a Buyer and a seller of a similar property in the area in which such Property is located. (b) Notwithstanding anything contained in the foregoing provisions: (i) At each Closing, (A) the First Closing Sellers, the Second Closing Sellers or the Bay Park Seller, as applicable, shall, at such Sellers’ option, either deliver to Buyer any security deposits reflected in the Leases and not previously applied before the Merger Date or thereafter up through the applicable Closing, or credit to the account of Buyer the amount of such security deposits, and (B) Buyer shall credit to the account of such Sellers all refundable cash or other deposits posted with utility companies serving a Property (solely in the event Buyer receives an acknowledgement of transfer of such deposits from the utility service provider), or, at Sellers’ option, such Sellers shall be entitled to receive and retain such refundable cash and deposits. (ii) Impositions shall be apportioned on the basis of the fiscal year for which the same are assessed, imposed, charged or became a lien, and otherwise in accordance with the provisions of this subsection; in all events, Impositions for which a xxxx or invoice has been issued attributable to any period prior to a Closing shall be fully-paid and satisfied as of the individual Closing and any and all accrued but not billed or invoiced Impositions attributable to any period prior to a Closing shall be credited to Buyer at an individual Closing with Seller responsible for payment or credit to Buyer of all Impositions for each day of the Properties’ ownership by Sellers without regard to billing period. If, as of the applicable Closing, the Impositions for a Property for the fiscal year in which the applicable Closing date occurs have not been finally determined, then (i) the apportionment made at the applicable Closing shall be upon the basis of the most recent rates thereof determined at the maximum discount rate allowed in the applicable jurisdiction, and (ii) promptly after the Impositions for such Property are finally determined, such apportionment shall be recomputed. Refunds of Impositions received by either a Seller or Buyer after the Closing shall be attributed to the fiscal year to which they relate, and the following provisions shall apply: (i) any such refund of Impositions attributed to any fiscal year ending prior to the applicable Closing shall belong to the applicable Seller (and if received by Buyer shall be paid to the applicable Seller when received), subject to the rights of tenants under Leases; and (ii) any such refund of Impositions received by the applicable Seller or Buyer attributed to the fiscal year in which the applicable Closing occurs (less reasonable attorneys’ fees and other expenses incurred in obtaining such refund), shall be apportioned between the applicable Seller and Buyer, when received, as hereinabove provided based upon the period of ownership, subject to the rights of tenants under Leases. To the extent that any tenant pays its Imposition obligations directly to the taxing authority, the portion of such Impositions attributable to such tenant shall not be prorated hereunder and Buyer shall not receive a credit at the applicable Closing with respect thereto. (iii) Charges referred to in Section 3.4(a) hereof that are payable by any tenant under a Lease directly to a third party shall not be apportioned hereunder, and Buyer shall accept title subject to any of such charges unpaid and Buyer shall look solely to the tenant responsible therefor for the payment of the same. If a Seller shall have paid any of such charges on behalf of any tenant, and shall not have been reimbursed therefor by the time of the applicable Closing, Buyer shall xxxx the tenant for the amount due and remit same to Seller promptly upon receipt. (iv) Sellers shall receive the entire advantage (prorated for its period of ownership) of any discounts for the prepayment by it of any taxes, water rates or sewer charges. (v) As to gas, electricity and other utility charges referred to in Section 3.4(a)(iv) hereof, Sellers shall use reasonable efforts to obtain readings of meters measuring utility consumption at the Properties (other than utilities which are the responsibility of tenants under Leases in effect as of the applicable Closing date) for all periods through (and including) the date preceding the applicable Closing date. Sellers shall pay, and be responsible, for all bills rendered on the basis of such readings. If such readings are not obtained for any metered utility, then, at the applicable Closing, apportionment shall be made on the basis of the most recent period for which such readings are available. Upon the taking of subsequent actual readings, there shall be a recalculation of the applicable utility charges, and Sellers or Buyer, as the case may be, shall promptly remit to the other party hereto any amounts to which such party shall be entitled by reason of such recalculation (with Sellers being obligated to pay all such utility charges pertaining to the period through the day prior to the applicable Closing date, and Buyer being obligated to pay all such utility charges pertaining to the period thereafter). Unmetered water charges or sewer charges shall be apportioned on the basis of the charges therefor for the same period during the previous calendar year, but applying the current rate thereto. As to any utility charges or sewer charges payable by tenants, Buyer shall close title and accept the delivery of the deeds for the Properties subject to such unpaid charges and any lien resulting therefrom, without credit against the Aggregate Net Purchase Price or any claim or right of action against Sellers. All non-transferable utilities will be terminated by Sellers at or prior to the applicable Closing. (vi) Seller shall pay to the applicable governmental authority the amount of any and all sales or similar taxes payable in connection with the Personal Property related to such Seller’s Property and Seller shall execute and deliver any tax returns required of it in connection therewith, said obligations of Seller to survive Closing. (vii) Sellers shall be responsible for all Leasing Costs (as hereinafter defined) that are payable by reason of (a) the execution of the Leases for tenants listed in Exhibit H attached hereto and incorporated herein (“Preapproved Leases”), (b) the execution of a Lease which occurs prior to the applicable Closing date for a new tenant which replaces or backfills a space or spaces
Appears in 1 contract
Samples: Purchase and Sale Agreement (Kite Realty Group Trust)
Credits and Prorations. (a) The following items shall be apportioned with respect to each Property, on a Property-by-Property basis, as of 11:59 p.m. on the day immediately preceding the date of the First Closing, the Second Closing or the Bay Park Closing, as applicable, on the basis of the actual number of days of the month which shall have elapsed as of the applicable Closing date and based upon the actual number of days in the month and a 365-day year and shall be set forth on a proration schedule prepared by Sellers and submitted to Buyer for its review and approval at least five (5) Business Days prior to the applicable Closing:
(i) scheduled rents from and including the date of Closing through the end of the month in which Closing occurs, (the term “rents” as used in this Agreement includes all payments due and payable by tenants under the Leases, including, without limitation, fixed rents, additional rents, percentage rents, escalation payments, and payments on account of real estate taxes, common area maintenance and other operating expenses), subject to the provisions of Sections 3.4(b)(viii) and 3.4(b)(ix) below;
(ii) all taxes, assessments and other impositions (including ad valorem and other real estate taxes, personal property taxes, water rates and sewer rents) assessed, imposed or charged upon or with respect to each Property or any component thereof (collectively, “Impositions”), in accordance with the provisions of Sections 3.4(b)(ii) below;
(iii) all amounts payable under the Contracts;
(iv) gas, electricity and other utility charges (if any) for which each Seller is liable, such charges to be apportioned at Closing on the basis of the most recent meter reading occurring prior to Closing or, if unmetered, on the basis of a current xxxx for each such utility;
(v) permit, license and inspection fees, if any, on the basis of the calendar year for which levied;
(vi) fuel, if any, at the cost per gallon most recently charged to each Seller, based on the supplier’s measurements thereof, plus sales tax thereon, which measurements shall be given by Sellers to Buyer as close to the applicable closing date as is reasonably practicable, and which, absent manifest error, shall be conclusive and binding on Sellers and Buyer;
(vii) deposits on account with any utility company servicing a Property to the extent transferred to Buyer shall not be apportioned, but Sellers shall receive a credit in the full amount thereof, including accrued interest, if any; and
(viii) any other operating expenses or other items pertaining to a Property which are customarily prorated between a Buyer and a seller of a similar property in the area in which such Property is located.
(b) Notwithstanding anything contained in the foregoing provisions:
(i) At each Closing, (A) the First Closing Sellers, the Second Closing Sellers or the Bay Park Seller, as applicable, shall, at such Sellers’ option, either deliver to Buyer any security deposits reflected in the Leases and not previously applied before the Merger Date or thereafter up through the applicable Closing, or credit to the account of Buyer the amount of such security deposits, and (B) Buyer shall credit to the account of such Sellers all refundable cash or other deposits posted with utility companies serving a Property (solely in the event Buyer receives an acknowledgement of transfer of such deposits from the utility service provider), or, at Sellers’ option, such Sellers shall be entitled to receive and retain such refundable cash and deposits.
(ii) Impositions shall be apportioned on the basis of the fiscal year for which the same are assessed, imposed, charged or became a lien, and otherwise in accordance with the provisions of this subsection; in all events, Impositions for which a xxxx or invoice has been issued attributable to any period prior to a Closing shall be fully-paid and satisfied as of the individual Closing and any and all accrued but not billed or invoiced Impositions attributable to any period prior to a Closing shall be credited to Buyer at an individual Closing with Seller responsible for payment or credit to Buyer of all Impositions for each day of the Properties’ ownership by Sellers without regard to billing period. If, as of the applicable Closing, the Impositions for a Property for the fiscal year in which the applicable Closing date occurs have not been finally determined, then (i) the apportionment made at the applicable Closing shall be upon the basis of the most recent rates thereof determined at the maximum discount rate allowed in the applicable jurisdiction, and (ii) promptly after the Impositions for such Property are finally determined, such apportionment shall be recomputed. Refunds of Impositions received by either a Seller or Buyer after the Closing shall be attributed to the fiscal year to which they relate, and the following provisions shall apply: (i) any such refund of Impositions attributed to any fiscal year ending prior to the applicable Closing shall belong to the applicable Seller (and if received by Buyer shall be paid to the applicable Seller when received), subject to the rights of tenants under Leases; and (ii) any such refund of Impositions received by the applicable Seller or Buyer attributed to the fiscal year in which the applicable Closing occurs (less reasonable attorneys’ fees and other expenses incurred in obtaining such refund), shall be apportioned between the applicable Seller and Buyer, when received, as hereinabove provided based upon the period of ownership, subject to the rights of tenants under Leases. To the extent that any tenant pays its Imposition obligations directly to the taxing authority, the portion of such Impositions attributable to such tenant shall not be prorated hereunder and Buyer shall not receive a credit at the applicable Closing with respect thereto.
(iii) Charges referred to in Section 3.4(a) hereof that are payable by any tenant under a Lease directly to a third party shall not be apportioned hereunder, and Buyer shall accept title subject to any of such charges unpaid and Buyer shall look solely to the tenant responsible therefor for the payment of the same. If a Seller shall have paid any of such charges on behalf of any tenant, and shall not have been reimbursed therefor by the time of the applicable Closing, Buyer shall xxxx the tenant for the amount due and remit same to Seller promptly upon receipt.
(iv) Sellers shall receive the entire advantage (prorated for its period of ownership) of any discounts for the prepayment by it of any taxes, water rates or sewer charges.
(v) As to gas, electricity and other utility charges referred to in Section 3.4(a)(iv) hereof, Sellers shall use reasonable efforts to obtain readings of meters measuring utility consumption at the Properties (other than utilities which are the responsibility of tenants under Leases in effect as of the applicable Closing date) for all periods through (and including) the date preceding the applicable Closing date. Sellers shall pay, and be responsible, for all bills rendered on the basis of such readings. If such readings are not obtained for any metered utility, then, at the applicable Closing, apportionment shall be made on the basis of the most recent period for which such readings are available. Upon the taking of subsequent actual readings, there shall be a recalculation of the applicable utility charges, and Sellers or Buyer, as the case may be, shall promptly remit to the other party hereto any amounts to which such party shall be entitled by reason of such recalculation (with Sellers being obligated to pay all such utility charges pertaining to the period through the day prior to the applicable Closing date, and Buyer being obligated to pay all such utility charges pertaining to the period thereafter). Unmetered water charges or sewer charges shall be apportioned on the basis of the charges therefor for the same period during the previous calendar year, but applying the current rate thereto. As to any utility charges or sewer charges payable by tenants, Buyer shall close title and accept the delivery of the deeds for the Properties subject to such unpaid charges and any lien resulting therefrom, without credit against the Aggregate Net Purchase Price or any claim or right of action against Sellers. All non-transferable utilities will be terminated by Sellers at or prior to the applicable Closing.
(vi) Seller shall pay to the applicable governmental authority the amount of any and all sales or similar taxes payable in connection with the Personal Property related to such Seller’s Property and Seller shall execute and deliver any tax returns required of it in connection therewith, said obligations of Seller to survive Closing.
(vii) Sellers shall be responsible for all Leasing Costs (as hereinafter defined) that are payable by reason of (a) the execution of the Leases for tenants listed in Exhibit H attached hereto and incorporated herein (“Preapproved Leases”), (b) the execution of a Lease which occurs prior to the applicable Closing date for a new tenant which replaces or backfills a space or spacesspaces occupied by any of the tenants listed on the rent roll attached hereto and incorporated herein as Exhibit F (the “Rent Roll”), and (c) the exercise by a tenant listed on the Rent Roll of any renewal, extension, or other option expressly set forth in such tenant’s Lease, which exercise occurs prior to the applicable Closing date. Subject to Buyer’s approval set forth in Section 5.1(a) (whether actually given or deemed given pursuant to Section 5.1(a)), Buyer shall be responsible for all Leasing Costs that will result in an increase to net operating income, such as but not limited to (x) the execution of any Leases for space marked as “VACANT” on the Rent Roll (a “Vacant Space”), and (y) any new lease or amendment to an existing Lease with a tenant referenced in the Rent Roll that increases the amount of space or the rent, or both, provided that the Leasing Costs for item (y) shall be equitably prorated between Buyer and Sellers attributable to the increase in net operating income as mutually agreed upon by the parties at the time of the approval of such transaction by Buyer. At Closing, Seller shall credit Buyer against the Purchase Price for any Leasing Costs that are such Seller’s responsibility pursuant to this Section 3.4(b)(vii) and which remain unpaid as of the Closing date. Furthermore, to the extent that a Seller has paid any Leasing Costs that are Buyer’s responsibility pursuant to this Section 3.4(b)(vii), the Purchase Price for such Property shall be increased at the applicable Closing by the amount paid. For purposes hereof, “Leasing Costs” shall mean, with respect to a particular Lease, all capital costs, expenses incurred for capital improvements, equipment, painting, decorating, partitioning and other items to satisfy the construction obligations of the landlord under such Lease (including any expenses incurred for architectural or engineering services in respect of the foregoing), “tenant allowances” in lieu of or as reimbursements for the foregoing items, payments made for purposes of satisfying or terminating the obligations of the tenant under such Lease to the landlord under another lease (i.e., lease buyout costs), relocation costs, temporary leasing costs, leasing commissions, brokerage commissions, legal, design and other professional fees and costs, in each case, to the extent the landlord is responsible for the payment of such cost or expense under the relevant Lease or any other agreement relating to such Lease.
Appears in 1 contract
Samples: Purchase and Sale Agreement (Inland Real Estate Income Trust, Inc.)
Credits and Prorations. (a) The following items shall be apportioned with respect to each Property, on a Property-by-Property basis, as of 11:59 p.m. (Eastern time) on the day immediately preceding the date of the First Closing, the Second Closing or the Bay Park Closing, as applicable, Date on the basis of the actual number of days of the month which shall have elapsed as of the applicable Closing date Date and based upon the actual number of days in the month and a 365-365 day year (it being understood that for purposes of prorations and adjustments, each Seller shall be deemed the owner of each applicable Property prior to the Closing Date and Purchaser shall be deemed the owner of the Properties as of the day of the Closing Date), and shall be set forth on a proration schedule prepared by Sellers and submitted to Buyer Purchaser for its review and approval at least five (5) Business Days prior to the applicable Closing:
(i) scheduled rents from rents, if, as and including the date of Closing through the end of the month in which Closing occurs, when collected (the term “rents” as used in this Agreement includes all payments due and payable by tenants under the Leases, including, without limitation, fixed rents, additional rents, percentage rents, escalation payments, and payments on account of real estate taxes, common area maintenance and other operating expenses), subject to the provisions of Sections 3.4(b)(viiisubsections 4.4(b)(vii) and 3.4(b)(ix4.4(b)(ix) below;
(ii) all taxes, assessments and other impositions (including ad valorem and other real estate taxes, personal property taxes, water rates and sewer rents) assessed, imposed or charged upon or with respect to each Property or any component thereof (collectively, “Impositions”), in accordance with the provisions of Sections 3.4(b)(iisubsection 4.4(b)(ii) below;
(iii) all amounts payable under the Property Contracts;
(iv) gas, electricity and other utility charges (if any) for which each Seller is liable, such charges to be apportioned at Closing on the basis of the most recent meter reading occurring prior to Closing or, if unmetered, on the basis of a current xxxx for each such utility;
(v) permit, license and inspection fees, if any, on the basis of the calendar fiscal year for which levied;
(vi) fuel, if any, at the cost per gallon most recently charged to each Seller, based on the supplier’s measurements thereof, plus sales tax thereon, which measurements shall be given by Sellers to Buyer as close to the applicable closing date as is reasonably practicable, and which, absent manifest error, shall be conclusive and binding on Sellers and Buyer;
(vii) deposits on account with any utility company servicing a Property to the extent transferred to Buyer Purchaser shall not be apportioned, but Sellers Seller shall receive a credit in the full amount thereof, including accrued interest, if any; and
(viiivii) any other operating expenses or other items pertaining to a Property which are customarily prorated between a Buyer purchaser and a seller of a similar property in the area in which such Property is located.
(b) Notwithstanding anything contained in the foregoing provisions:
(i) At each Closing, (A) the First Closing Sellers, the Second Closing Sellers or the Bay Park Seller, as applicable, shall, at such Sellers’ option, either deliver to Buyer Purchaser any security deposits reflected in actually held by Sellers pursuant to the Leases and not previously applied before the Merger Date or thereafter up through the applicable Closing, or credit to the account of Buyer Purchaser the amount of such security depositsdeposits (to the extent such security deposits are not applied against delinquent rents or otherwise as provided in the Leases), and (B) Buyer Purchaser shall credit to the account of such Sellers all refundable cash or other deposits posted with utility companies serving a Property (solely in the event Buyer receives an acknowledgement of transfer of such deposits from the utility service provider)Property, or, at Sellers’ option, such Sellers shall be entitled to receive and retain such refundable cash and deposits. Sellers shall also transfer to Purchaser any security deposits that are held in the form of letters of credit (the “SD Letters of Credit”) if the same are transferable, at the applicable Seller’s cost (including payment by such Seller on or before the Closing of any third party transfer fees and expenses); provided, however, if any of the SD Letters of Credit is not transferable, the applicable Seller shall request the tenant obligated under such SD Letters of Credit to cause a new letter of credit to be issued in favor of Purchaser in replacement thereof and in the event such a new letter of credit is not issued in favor of Purchaser by Closing, the applicable Seller shall at its cost pursue such replacement after Closing and the applicable Seller shall take all reasonable action, as directed by Purchaser and at such Seller’s expense, in connection with the presentment of such SD Letters of Credit for payment as permitted under the terms of the applicable Lease.
(ii) Impositions shall be apportioned on the basis of the fiscal applicable tax year for which the same are assessed, imposed, charged imposed or became a liencharged, and otherwise in accordance with the provisions of this subsection; in all events, Impositions for which a xxxx or invoice has been issued attributable to any period prior to a Closing shall be fully-paid and satisfied as of the individual Closing and any and all accrued but not billed or invoiced Impositions attributable to any period prior to a Closing shall be credited to Buyer at an individual Closing with Seller responsible for payment or credit to Buyer of all Impositions for each day of the Properties’ ownership by Sellers without regard to billing period. If, as of the applicable Closing, the Impositions for a Property for the fiscal applicable tax year in which the applicable Closing date Date occurs have not been finally determined, then (i) the apportionment made at the applicable Closing shall be upon the basis of the most recent rates thereof determined at the maximum discount rate allowed in the applicable jurisdiction, and (ii) promptly after the Impositions for such Property are finally determined, such apportionment shall be recomputed. Refunds of Impositions received by either a Seller or Buyer Purchaser after the Closing shall be attributed to the fiscal applicable tax year to which they relate, and the following provisions shall apply: (i) any such refund of Impositions attributed to any fiscal applicable tax year ending prior to the applicable Closing shall be belong to the applicable Seller (and if received by Buyer Purchaser shall be paid to the applicable Seller when received), subject to the rights of tenants under Leases; and (ii) any such refund of Impositions received by the applicable Seller or Buyer Purchaser attributed to the fiscal applicable tax year in which the applicable Closing occurs (less reasonable attorneys’ fees and other expenses incurred in obtaining such refund), shall be apportioned between the applicable Seller and BuyerPurchaser, when received, as hereinabove provided based upon the period of ownershipotherwise herein-above provided, subject to the rights of tenants under Leases. To the extent that any tenant pays its Imposition obligations directly to the taxing authority, the portion of such Impositions attributable to such tenant shall not be prorated hereunder and Buyer shall not receive a credit at the applicable Closing with respect thereto.
(iii) Charges referred to in Section 3.4(a4.4(a) hereof that are payable by any tenant under a Lease directly to a third party shall not be apportioned hereunder, and Buyer Purchaser shall accept title subject to any of such charges unpaid and Buyer Purchaser shall look solely to the tenant responsible therefor for the payment of the same. If a Seller shall have paid any of such charges on behalf of any tenant, and shall not have been reimbursed therefor by the time of the applicable Closing, Buyer Purchaser shall xxxx the tenant for the pay to such Seller an amount due equal to all such charges so paid by such Seller if and remit same to Seller promptly upon receiptwhen Purchaser receives payment of such amount from such tenant.
(iv) Sellers shall receive the entire advantage (prorated for its period of ownership) of any discounts for the prepayment by it of any taxes, water rates or sewer chargesrents assessed during Sellers’ period of ownership of the Properties.
(v) As to gas, electricity and other utility charges referred to in Section 3.4(a)(iv4.4(a)(iv) hereof, Sellers shall use reasonable efforts to obtain readings of meters measuring utility consumption at the Properties (other than utilities which are the responsibility of tenants under Leases in effect as of the applicable Closing dateDate) for all periods through (and including) the date preceding the applicable Closing dateDate. Sellers shall pay, and be responsible, for all bills rendered on the basis of such readings. If such readings are not obtained for any metered utility, then, at the applicable Closing, apportionment shall be made on the basis of the most recent period for which such readings are available. Upon the taking of subsequent actual readings, there shall be a recalculation of the applicable utility charges, and Sellers or BuyerPurchaser, as the case may be, shall promptly remit to the other party hereto any amounts to which such party shall be entitled by reason of such recalculation (with Sellers being obligated to pay all such utility charges pertaining to the period through the day prior to the applicable Closing dateDate, and Buyer Purchaser being obligated to pay all such utility charges pertaining to the period thereafter). Unmetered water charges or sewer charges rents shall be apportioned on the basis of the charges therefor for the same period during the previous calendar year, but applying the current rate thereto. As to any utility charges or sewer charges rents payable by tenantstenants directly to the applicable utility company or municipality (as the case may be), Buyer Purchaser shall close title and accept the delivery of the deeds for the Properties subject to such unpaid charges and rents and any lien resulting therefrom, without credit against the Aggregate Net Purchase Price or any claim or right of action against Sellers. All non-transferable utilities will be terminated by Sellers at or prior to the applicable Closing.
(vi) Seller shall pay to the applicable governmental authority the amount of any and all sales or similar taxes payable in connection with the Personal Property related to such Seller’s Property and Seller shall execute and deliver any tax returns required of it in connection therewith, said obligations of Seller to survive Closing.
(vii) Sellers shall be responsible for all Leasing Costs (as hereinafter defined) that are payable by reason of (a) the execution of the Leases for tenants listed in Exhibit H attached hereto and incorporated herein (“Preapproved Leases”), (b) the execution of a Lease which occurs prior to the applicable Closing date for a new tenant which replaces or backfills a space or spaces
Appears in 1 contract
Samples: Purchase and Sale Agreement (Kite Realty Group Trust)
Credits and Prorations. (a) The following items shall be apportioned with respect to each the Property, on a Property-by-Property basisas set forth in greater detail in Section 4.4(b) below, as of 11:59 p.m. on the day immediately preceding the date of the First Closing, the Second Closing or the Bay Park Closing, as applicable12:01 a.m., on the basis of Closing Date (the actual number of days of the month which shall have elapsed "Cut-Off Time"), as of the applicable Closing date and based upon the actual number of days in the month and a 365-day year and shall be set forth on a proration schedule prepared by Sellers and submitted to Buyer for its review and approval at least five (5) Business Days prior if Purchaser were vested with title to the applicable ClosingProperty during the entire day upon which Closing occurs:
(i) scheduled rents from taxes (including personal property taxes on the Personal Property) and including assessments levied against the date of Closing through the end of the month in which Closing occurs, Property;
(the term “rents” as used in this Agreement includes all ii) payments due and payable by tenants under the Leases, Operating Agreements (including, without limitation, fixed rents, additional rents, percentage rents, escalation payments, and payments on account of real estate taxes, common area maintenance and other operating expensesthe Rental Agreements), subject to the provisions of Sections 3.4(b)(viii) and 3.4(b)(ix) below;
(ii) all taxes, assessments and other impositions (including ad valorem and other real estate taxes, personal property taxes, water rates and sewer rents) assessed, imposed or charged upon or with respect to each Property or any component thereof (collectively, “Impositions”), in accordance with the provisions of Sections 3.4(b)(ii) below;
(iii) all amounts payable under the Contracts;
(iv) water, gas, electricity and other utility charges (if any) for which each Seller is liable, if any, such charges to be apportioned at Closing on the basis of (A) for metered utilities, the most recent meter reading occurring prior to Closing orClosing, if unmeteredand (B) for non-metered utilities, a per diem apportionment based on the basis dates of a current xxxx for each service of such utilityutilities with respect to the Cut-Off Time (but in either event subject to later readjustment as set forth below);
(iv) all Receivables including, without limitations, receivables accrued in connection with hotel reservations, the use of guest rooms, banquet and meeting room receivables (including any cancellation fees due to Seller in connection with any of the foregoing);
(v) permitAll fixed monthly rent, license additional rent, escalation rent and inspection feesother sums payable under any Lease or similar agreement for use of space at the Hotel (collectively, if any, on the basis of the calendar year for which levied"Rent") in accordance with Section 4.4(b)(xii) below;
(vi) fuel, if any, at the cost per gallon most recently charged to each Seller, based on the supplier’s measurements thereof, plus sales tax thereon, which measurements shall be given by Sellers to Buyer as close to the applicable closing date as is reasonably practicable, and which, absent manifest error, shall be conclusive and binding on Sellers and Buyeradvance deposits;
(vii) deposits on account with any utility company servicing a Property operational and/or occupancy taxes;
(viii) if the Management Agreement is not terminated as of Closing pursuant to Section 1.8 above, management fees pursuant to the extent Management Agreement;
(ix) charges and fees paid or payable for licenses and permits transferred by Seller to Buyer shall not be apportionedPurchaser;
(x) any other payables pertaining to the Property, but Sellers shall receive a credit subject to later readjustment as set forth in the full amount thereof, including accrued interest, if anySections 4.4(d) and (e) below; and
(viiixi) any other operating expenses or other items pertaining to a the Property which are customarily prorated between a Buyer purchaser and a seller of a similar property in the area in which such Property is locatedfor comparable hotel properties including, without limitation, any prepaid expenses.
(b) Notwithstanding anything contained in the foregoing provisions:
(i) At each Closing, (A) the First Closing Sellers, the Second Closing Sellers or the Bay Park Seller, as applicable, shall, at such Sellers’ option, either deliver to Buyer any security deposits reflected in the Leases and not previously applied before the Merger Date or thereafter up through the applicable Closing, or Seller shall receive a credit to the account of Buyer the amount of such security deposits, and (B) Buyer shall credit to the account of such Sellers for all refundable cash or other deposits posted with utility companies serving a the Property (solely in the event Buyer receives an acknowledgement of transfer of such deposits from the utility service provider)or any governmental agencies or authorities or posted pursuant to any Operating Agreement, or, at Sellers’ Seller's option, such Sellers Seller shall be entitled to receive and retain such refundable cash and deposits.
(ii) Impositions Any taxes paid at or prior to Closing shall be apportioned on prorated based upon the basis amounts actually paid. If taxes and assessments for the current year have not been paid before Closing, Seller shall be charged at Closing an amount equal to that portion of such taxes and assessments which relates to the fiscal period before Closing and Purchaser shall pay the taxes and assessments prior to their becoming delinquent. Any such apportionment made with respect to a tax year for which the same are assessedtax rate or assessed valuation, imposedor both, charged or became a lien, and otherwise in accordance with the provisions of this subsection; in all events, Impositions for which a xxxx or invoice has have not yet been issued attributable to any period prior to a Closing fixed shall be fully-paid and satisfied as of the individual Closing and any and all accrued but not billed or invoiced Impositions attributable to any period prior to a Closing shall be credited to Buyer at an individual Closing with Seller responsible for payment or credit to Buyer of all Impositions for each day of the Properties’ ownership by Sellers without regard to billing period. If, as of the applicable Closing, the Impositions for a Property for the fiscal year in which the applicable Closing date occurs have not been finally determined, then (i) the apportionment made at the applicable Closing shall be upon the basis of the most recent rates thereof determined at the maximum discount rate allowed in the applicable jurisdiction, and (ii) promptly after the Impositions for such Property are finally determined, such apportionment shall be recomputed. Refunds of Impositions received by either a Seller or Buyer after the Closing shall be attributed to the fiscal year to which they relate, and the following provisions shall apply: (i) any such refund of Impositions attributed to any fiscal year ending prior to the applicable Closing shall belong to the applicable Seller (and if received by Buyer shall be paid to the applicable Seller when received), subject to the rights of tenants under Leases; and (ii) any such refund of Impositions received by the applicable Seller or Buyer attributed to the fiscal year in which the applicable Closing occurs (less reasonable attorneys’ fees and other expenses incurred in obtaining such refund), shall be apportioned between the applicable Seller and Buyer, when received, as hereinabove provided based upon the period of ownership, subject to the rights of tenants under Leasestax rate and/or assessed valuation last fixed. To the extent that the actual taxes and assessments for the current year differ from the amount apportioned at Closing, the parties shall make all necessary adjustments by appropriate payments between themselves following Closing. All necessary adjustments shall be made within fifteen (15) business days after the tax xxxx for the current year is received. Seller retains the right to commence, continue and settle any tenant pays its Imposition obligations directly proceeding to contest any taxes for any taxable period which encompasses any period prior to the taxing authoritydate of the Closing, the portion and shall be entitled to any refunds or abatements of Taxes awarded in such Impositions attributable to such tenant shall not be prorated hereunder and Buyer shall not receive a credit at the applicable Closing with respect theretoproceedings.
(iii) Charges referred to in Section 3.4(a) hereof that are payable by any tenant under a Lease directly to a third party shall not be apportioned hereunder, and Buyer shall accept title subject to any of such charges unpaid and Buyer shall look solely to the tenant responsible therefor for the payment of the same. If a Seller shall have paid any of such charges on behalf of any tenant, and shall not have been reimbursed therefor by the time of the applicable Closing, Buyer shall xxxx the tenant for the amount due and remit same to Seller promptly upon receipt.
(iv) Sellers shall receive the entire advantage (prorated for its period of ownership) of any discounts for the prepayment by it of any taxes, water rates or sewer chargesrents.
(viv) As to gas, electricity and other utility charges referred to in Section 3.4(a)(iv4.4(a)(iii) hereofabove, Sellers Seller may, on notice to Purchaser, elect to pay one or more of all of said items accrued to the date hereinabove fixed for apportionment directly to the person or entity entitled thereto, and to the extent Seller so elects, such item shall use reasonable efforts not be apportioned hereunder, and Seller's obligation to obtain readings of meters measuring utility consumption at pay such item directly in such case shall survive the Properties Closing.
(other than utilities which are the responsibility of tenants under Leases in effect as v) As of the applicable Closing date) for all periods through (and including) the date preceding the applicable Closing date. Sellers shall pay, and be responsible, for all bills rendered on the basis of such readings. If such readings are not obtained for any metered utility, then, at the applicable Closing, apportionment shall be made on the basis of the most recent period for which such readings are available. Upon the taking of subsequent actual readings, there shall be a recalculation of the applicable utility charges, and Sellers or Buyer, as the case may be, shall promptly remit to the other party hereto any amounts to which such party shall be entitled by reason of such recalculation (with Sellers being obligated to pay all such utility charges pertaining to the period through the day immediately prior to the applicable date of Closing, Seller and Purchaser shall jointly conduct or cause the Manager to conduct an inventory of all Unopened Inventory and shall deliver a written report thereon to Seller and Purchaser. Such report shall reflect the value of the Unopened Inventory at the acquisition cost thereof and shall be certified by Manager to Seller and Purchaser as accurately reflecting all Unopened Inventory at the Hotel and the acquisition cost thereof. On account of Purchaser's purchase of the Unopened Inventory, Seller shall receive a credit at Closing date, and Buyer being obligated to pay all such utility charges pertaining in an amount equal to the period thereafter). Unmetered water charges or sewer charges shall be apportioned on the basis total value of the charges therefor Unopened Inventory as reflected in such inventory to the extent that such Unopened Inventory has been paid for the same period during the previous calendar year, but applying the current rate thereto. As to any utility charges by Seller or sewer charges payable by tenants, Buyer shall close title and accept the delivery of the deeds for the Properties subject to such unpaid charges and any lien resulting therefrom, without credit against the Aggregate Net Purchase Price or any claim or right of action against Sellers. All non-transferable utilities will be terminated paid for by Sellers at or prior to the applicable ClosingSeller.
(vi) At Closing, Seller shall pay receive (or receive a credit in an amount equal to) all revenue (after the settlement of applicable commissions and/or costs) relating to vending machines in the applicable governmental authority Hotel up until the amount of any and all sales or similar taxes payable in connection with the Personal Property related to such Seller’s Property and Seller shall execute and deliver any tax returns required of it in connection therewith, said obligations of Seller to survive ClosingCut-Off Time.
(vii) Sellers Revenues from the Hotel guest rooms (other than those set forth in clause (x) below) occupied on the evening immediately preceding the date of Closing, including any sales taxes, room taxes and other taxes charged to guests in such rooms with respect to the evening immediately preceding the date of Closing shall be responsible divided equally between Seller and Purchaser (where a complete meeting package ("CMP") guest is staying on a CMP rate, the food and beverage revenues shall be allocated based on whether the applicable meal or service occurred before or after the Cut-Off Time); provided, however, that to the extent that Manager records in the ordinary course the times at which food and beverage sales, telephone, facsimile or data communication, in-room movie, laundry, and other services are ordered by guests, then the same shall be allocated between Seller and Purchaser based on when orders for the same were received, with orders originating prior to the Cut-Off Time being allocable to Seller, and orders originating after the Cut- Off Time being allocable to Purchaser. All revenues from restaurants and other service operations conducted at the Property shall be allocated based on whether the same accrued before or after the Cut-Off Time as described in the preceding sentence, and Seller shall cause the Manager to separately record sales occurring before and after the Cut- Off Time at the Property. The foregoing amounts are referred to collectively as "Guest Revenues". Notwithstanding the foregoing, all Leasing Costs revenues from any bars and lounges at the Property shall be prorated based on the actual closing time for such bar or lounge. For example, if such bar or lounge closes at 2 a.m. on the Closing Date, Seller shall retain the revenues from such services and operations even though such revenues were generated two (2) hours after the Cut-Off Time.
(viii) Revenues from conferences, receptions, meetings, and other functions occurring in any conference, banquet or meeting rooms in the Hotel, or in any adjacent facilities owned or operated by Seller, including usage charges and related taxes, food and beverage sales, valet parking charges, equipment rentals, and telecommunications charges, shall be allocated between Seller and Purchaser, based on when the function therein commenced, with (i) one-day functions commencing prior to the Cut-Off Time being allocable to Seller, (ii) functions commencing after the Cut- Off Time being allocable to Purchaser, and (ii) multi-day functions being allocated between Seller and Purchaser according to when the event commences and is scheduled to end. The foregoing amounts are referred to collectively as "Conference Revenues."
(ix) Purchaser shall receive a credit at Closing in an amount equal to one hundred percent (100%) of all advance deposits that shall have been received by or credited to Seller prior to the Cut-Off Time on account of reservations for use or occupancy of the Property after the Cut-Off Time.
(x) To the extent not actually collected by Seller or Manager prior to the Cut-Off Time, all Guest Revenues and Conference Revenues allocated to Seller hereunder and not paid in cash prior to the Cut-Off Time including Seller's city ledger, guest ledger and any other receivable ledgers shall together constitute Receivables hereunder and shall be purchased by Purchaser at Closing. On account of Purchaser's purchase of the Receivables, Seller shall receive a credit at Closing in an amount equal to (A) 100% of the guest ledger amount, and (B) 98% of the city ledger amount, of the Receivables as reflected in the books of the Manager, as apportioned between Seller and Purchaser in accordance with this Section 4.4. After Closing, Purchaser shall have the exclusive right to collect all Receivables, and Seller shall have no further rights or interests therein. Purchaser shall have no right to any adjustment to the prorations with respect to the Receivables on or after Closing, for inability to collect outstanding Receivables or otherwise.
(xi) Rent shall be prorated as of the Closing Date. Percentage rent or overage rent (referred to herein as "Percentage Rent") under the Leases shall be prorated between Purchaser and Seller on a Lease by Lease basis with Seller entitled to the portion of total Percentage Rent paid under each Lease for the Lease Year (as hereinafter defineddefined below) that are payable in which the Closing occurs (the "Subject Lease Year") which is in the same ratio to total Percentage Rent paid with respect to such Lease Year under the subject Lease as the ratio of (A) the number of days of said Lease Year which Seller was the landlord under the subject Lease to (B) the total number of days in said Subject Lease Year. Purchaser shall be entitled to the balance of Percentage Rent paid under each Lease with respect to the Subject Lease Year. As used herein, the term "Lease Year" means the twelve (12) month period (or, as to tenants for which the Closing occurs during a partial Lease Year, such applicable shorter period) as to which annual Percentage Rent is owed under each Lease. The foregoing proration shall be made as follows on a Lease by reason Lease basis: (i) for each Lease, not later than thirty (30) days after the date the last Percentage Rent payment with respect to the Subject Lease Year is due, Purchaser shall deliver to Seller a statement of all Percentage Rent owed, collected or deemed collectable by Purchaser with respect to such Lease along with a copy of the annual reconciliation of Percentage Rent owed under the subject Lease for the Subject Lease Year and the related sales information backup; and, (ii) for each Lease, within fifteen (15) days after the date the statement and reconciliation described in clause (i) above is delivered to Seller, Purchaser shall pay to Seller or Seller shall pay to Purchaser, whichever is applicable, the positive difference between (a) the execution of total Percentage Rental collected by such party with respect to the Leases for tenants listed in Exhibit H attached hereto Subject Lease Year and incorporated herein (“Preapproved Leases”), (b) the execution product of a Lease which occurs prior (x) the average daily Percentage Rental received with respect to the applicable Closing date for Subject Lease Year after taking into account the annual reconciliation and (y) the actual number of days such party was the owner of the Property during the Subject Lease Year (with Purchaser being deemed to be the owner as of the Closing). If Percentage Rent is thereafter collected by Purchaser from delinquent tenants, Purchaser shall promptly pay to Seller a new tenant portion thereof which replaces or backfills a space or spacesis equal to the ratio of (aa) the number of days of the subject Lease Year in which Seller was the landlord under the subject Lease has to (bb) the total number of days in the Lease Year. Seller shall have the right, upon reasonable notice but no more often than twice in any twelve (12) month period, to audit Purchaser's books and records to verify the amount of Percentage Rent which has actually been collected by Purchaser.
Appears in 1 contract
Samples: Purchase and Sale Agreement (Maui Land & Pineapple Co Inc)
