CONTRACT OF SALE
between
54-55 STREET COMPANY,
as Seller,
and
RECKSON OPERATING PARTNERSHIP, L.P.,
as Purchaser
Dated As of October 15, 1999
TABLE OF CONTENTS
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Page
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GLOSSARY........................................................................................................iii
SECTION 1. Purchase and Sale of Premises.................................................................1
SECTION 2. Purchase Price; Downpayment...................................................................1
SECTION 3. Closing.......................................................................................5
SECTION 4. Termination Option............................................................................6
SECTION 5. Title Exceptions..............................................................................6
SECTION 6. Failure of Seller or Purchaser to Perform.....................................................7
SECTION 7. Representations and Warranties of Seller and Purchaser........................................8
SECTION 8. Inspection of the Premises...................................................................22
SECTION 9. Violations Affecting the Premises............................................................24
SECTION 10. Destruction, Damage or Condemnation Affecting the Premises...................................24
SECTION 11. Seller's Closing Obligations.................................................................26
SECTION 12. Purchaser's Closing Obligations..............................................................30
SECTION 13. Apportionments and Adjustments; Closing Costs................................................32
SECTION 14. Operation of Premises........................................................................37
SECTION 15. Broker.......................................................................................40
SECTION 16. Notices......................................................................................41
SECTION 17. Limitation on Survival of Representations, Warranties and Obligations........................43
SECTION 18. Prohibition of Recording.....................................................................43
SECTION 19. Miscellaneous................................................................................43
EXHIBITS
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[redacted]
GLOSSARY
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[redacted]
CONTRACT OF SALE
CONTRACT OF SALE (the "Agreement"), dated as of October __, 1999, between
54-55 STREET COMPANY, a joint venture organized under the laws of the State of
New York, having an address at 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx
00000 ("Seller"), and RECKSON OPERATING PARTNERSHIP, L.P., a Delaware limited
partnership having an address at c/o Reckson Associates Realty Corp., 00 Xxxx
00xx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 ("Purchaser").
W I T N E S S E T H:
WHEREAS, Seller desires to sell the Premises (as hereinafter defined) to
Purchaser, and Purchaser desires to purchase the Premises from Seller, upon
the terms and subject to the conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual agreements hereinafter set
forth and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto hereby agree as follows:
SECTION 1. Purchase and Sale of Premises. Subject to and in accordance
with the provisions of this Agreement, Seller shall sell to Purchaser, and
Purchaser shall purchase from Seller, all of Seller's right, title and
interest in and to the following: (a) the real property described on Exhibit
"A" annexed hereto and made a part hereof (the "Land"), (b) the building and
other improvements situated on the Land (collectively, the "Improvements"),
(c) any land lying in the bed of any street or highway in front of or
adjoining the Land to the center line thereof, (d) any appurtenances to the
Land or the Improvements, and (e) to the extent owned by Seller, the fixtures,
equipment and other personal property attached or appurtenant to the
Improvements on the date hereof and/or to the extent located on the Premises,
used in connection with the ownership, operation and management of the
Premises (the items enumerated in clauses (a)-(e) above being hereinafter
collectively referred to as the "Premises").
SECTION 2. Purchase Price; Downpayment.
2.1. The aggregate purchase price to be paid by Purchaser to Seller
for the Premises (the "Purchase Price") is ONE HUNDRED TWENTY-SIX MILLION FIVE
HUNDRED THOUSAND AND 00/100 DOLLARS ($126,500,000.00), subject to adjustment
as provided in Section 2.2(d), which amount shall be payable in accordance
with the further provisions of this Section 2.
2.2. (a) Simultaneously with the execution and delivery of this
Agreement, Purchaser shall deliver to Escrowee (as hereinafter defined), by
wire transfer in immediately available federal funds to Citibank, N.A., 000
Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Account Name - Xxxxxx, Xxxx &
Xxxxxxxx, LLP, Account Number - 00000000, ABA Number 000-000-000 (the "Escrow
Holding Account"), the amount of SIX MILLION AND 00/100 DOLLARS
($6,000,000.00) as a downpayment (the "Downpayment") on account of the
Purchase Price.
(b) The Downpayment, together with all interest earned thereon,
hereinafter collectively shall be referred to as the "Escrow Funds." Escrowee
shall transfer and deposit all Escrow Funds from the Escrow Holding Account to
the separate escrow account ("Escrow Account") referred to below and shall
thereafter hold and disburse the Escrow Funds in accordance with the
provisions of Section 2.3 hereof. As used in this Agreement, the term
"Escrowee" shall mean and refer to Xxxxxx, Xxxx & Xxxxxxxx LLP.
(c) At the Closing, Purchaser shall (i) pay to Seller the
amount of ONE HUNDRED TWENTY-FOUR MILLION and 00/100 DOLLARS
($124,000,000.00), plus any Additional Purchase Price which is payable
pursuant to Section 2.2(d), less the amount of the Downpayment actually
delivered by Purchaser to Escrowee (less any funds used by Seller for
restoration and not replaced by Purchaser pursuant to Section 2.3(d) hereof),
and less the amount of the holdback provided for in Section 7.7 hereof,
further subject to apportionments and other adjustments made in accordance
with the terms of Section 13 and Section 14 hereof, (ii) pay the amount of the
holdback provided for in Section 7.6 hereof to the Warranties Holdback
Escrowee, which subject to the terms and conditions set forth in Section 7.6
hereof, shall be paid to Seller on account of the balance of the Purchase
Price not later than nine (9) months after the Closing (except for the Remy
Amerique Commission Funds (as defined herein) which subject to the terms and
conditions set forth in Section 7.6 hereof, shall be paid to Seller not later
than December 31, 2000 as provided below), and (iii) direct Escrowee to
deliver to Seller the Escrow Funds.
(d) [section redacted]
At all times from and after the date hereof through the Surrender
Period, to the extent Hearst desires to surrender any of the Hearst Space,
Seller and Purchaser shall jointly negotiate with Hearst to obtain a surrender
of the Hearst Space to maximize the space to be surrendered, and neither
Seller nor Purchaser shall contact or communicate with the Hearst Tenant (or
any parent or affiliate) or any agent or representative thereof ("Hearst
Party"), directly or indirectly, concerning (x) any extension , renewal,
termination or surrender of the Hearst Lease, or (y) any amendment or
modification of the Hearst Lease related to or which might materially and
adversely affect the surrender of any Hearst Space, without the prior written
consent of the other. If either Seller or Purchaser shall receive any
communication from any Hearst Party concerning the Hearst Space or Hearst
Lease during the Surrender Period, it shall promptly make full disclosure
thereof to the other party.
(e)......Except as otherwise provided for in this Agreement, all
monies payable to Seller by Purchaser pursuant to this Agreement, shall be
paid by wire transfer in immediately available federal funds to an account or
accounts designated in writing from time to time by Seller.
2.3. (a) Escrowee shall hold the Escrow Funds in escrow in an
interest-bearing account (or as otherwise agreed in writing by Seller,
Purchaser and Escrowee) in a New York Clearing House Bank or in a nationally
recognized "money fund" (the "Escrow Account") until the Closing or sooner
termination of this Agreement and shall pay over or apply the Escrow Funds in
accordance with the further provisions of this Section 2.3. The party which
receives the interest earned on the Downpayment shall pay all income taxes
owed in connection therewith. The employer identification numbers of Seller
and Purchaser are set forth on the signature page hereof. Escrowee shall not
be liable to Purchaser or Seller for any loss occasioned by any deposit of the
Escrow Funds made in accordance with this Section 2.3.
(b) At the Closing, the Escrow Funds shall be paid by Escrowee
to Seller and Purchaser shall receive a credit against the Purchase Price
equal to the sum of the Escrow Funds.
(c) Subject to, and following in compliance with, the
provisions of Section 2.3(e) hereof, Escrowee shall deliver to Seller the
Escrow Funds at the expiration of ten (10) business days following Escrowee's
receipt of Seller's written demand ("Seller's Demand") for the Escrow Funds
stating that Purchaser has defaulted in the performance of Purchaser's
obligations under this Agreement and specifying such default in reasonable
detail or that Seller is entitled to use the Escrow Funds to restore the
Premises as provided in Section 8.2(b) hereof (it being understood and agreed
that (i) Seller shall have no obligation to restore the Premises, and (ii) to
the extent Seller uses all or any portion of the Escrow Funds to restore the
Premises, Purchaser shall promptly pay to Escrowee an amount equal to the
Escrow Funds used to restore the Premises). Simultaneously with Seller's
delivery of Seller's Demand to Escrowee, Seller shall deliver a copy of
Seller's Demand to Purchaser.
(d) Subject to, and following in compliance with, the
provisions of Section 2.3(e) hereof, Escrowee shall deliver to Purchaser the
Escrow Funds at the expiration of ten (10) business days following Escrowee's
receipt of Purchaser's written demand ("Purchaser's Demand") therefor stating
in reasonable detail that (i) the Closing did not occur on the Scheduled
Closing Date (as hereinafter defined), or on such later date to which the
Closing shall have been adjourned, as a result of Seller's inability or
refusal to convey title to the Premises in accordance with the provisions of
this Agreement, or (ii) Purchaser has properly terminated this Agreement in
accordance with the provisions hereof. Simultaneously with Purchaser's
delivery of Purchaser's Demand to Escrowee, Purchaser shall deliver a copy of
Purchaser's Demand to Seller.
(e) If Escrowee receives either Seller's Demand or Purchaser's
Demand (individually, a "Demand") pursuant to and in accordance with Section
2.3(c) or (d) hereof, as the case may be, then, in such event, prior to
releasing the Escrow Funds, Escrowee shall deliver a copy of Seller's Demand
or Purchaser's Demand, as the case may be, to the non-demanding party within
five (5) business days after receipt thereof by Escrowee. If Escrowee shall
not have received a written objection to the proposed payment by the close of
business on the tenth (10th) business day following the date of Seller's
Demand or Purchaser's Demand, as the case may be, then, in such event,
Escrowee is hereby authorized and directed to make the payment set forth in
such Demand on the eleventh (11th) business day following the date of such
Demand. If Escrowee shall have received a written objection from either party
before such payment, then, in such event, Escrowee shall continue to hold the
Escrow Funds until otherwise directed by written instructions from both of the
parties hereto or by a final unappealable judgment of a court of competent
jurisdiction; provided, however, that Escrowee shall have the right, at any
time, to deposit the Escrow Funds with any court of competent jurisdiction and
thereby be relieved and discharged of any further obligations or liability
under this Agreement. Escrowee shall give written notice of any such deposit
to Seller and Purchaser. Escrowee shall be entitled to rely upon the
authenticity of any signature and/or the validity of any writing received by
Escrowee pursuant to, or otherwise relating to, this Agreement. Any writing
signed by any two (2) of the "parties of the first part" of Seller, on behalf
of Seller, shall be sufficient to bind Seller, and Escrowee shall be entitled
to rely thereon. The "parties of the first part" of Seller are Xxxxxxxx
Xxxxxxxx Xxxxxxxxx (whose official successor as such party of the first part
is Xxxx Xxxxxxxx Grant), Xxxxx X. Xxxxxxxx (whose official successor as such
party of the first part is Xxxx Xxxxxxxx Grant), and the Estate of Xxxxxx
Xxxxxxxx (whose co-executors are Xxxxxxxx Xxxxxxxx and United States Trust
Company of New York).
(f) The parties acknowledge and agree that (i) Escrowee, in its
capacity as the holder of the Escrow Funds hereunder, is acting solely as a
stakeholder at the parties' request and for their convenience; (ii) although
Escrowee, in its capacity as attorney, acts as the attorney for Seller in
connection with the transactions contemplated herein, Escrowee shall not be
deemed to be the agent of either of the parties hereto as holder of the Escrow
Funds (provided, however, that the parties hereto acknowledge and agree that
(x) Purchaser, by its execution and delivery of this Agreement, has pledged to
Seller the Escrow Funds as security for Purchaser's obligations hereunder, (y)
Purchaser hereby grants to Seller a first priority lien on, and security
interest in, the Escrow Funds, and (z) Escrowee shall be deemed to be Seller's
agent for the purposes of such pledge and grant of security interest); (iii)
any conflict of interest that may exist because of Escrowee's representation
of Seller hereunder as attorney and/or acting as agent with respect to said
pledge and grant of security interest is hereby waived; and (iv) Escrowee
shall not be liable to either of the parties hereto or to any third-party for
any act or omission on its part as Escrowee unless due to Escrowee's gross
negligence or willful misconduct. Seller and Purchaser, jointly and severally,
shall indemnify, defend and hold harmless Escrowee from and against any and
all losses, liabilities, costs, claims, damages or expenses (including,
without limitation, reasonable attorneys' fees and costs) which may be
incurred or suffered by Escrowee in connection with the performance of
Escrowee's duties hereunder, excepting Escrowee's gross negligence or willful
misconduct. As between Seller and Purchaser, the party responsible for the
acts or omissions giving rise to the foregoing indemnity obligation, shall be
liable to the other party for contribution or reimbursement.
SECTION 3. Closing.
3.1 (a) The closing of the transaction contemplated by this
Agreement (the "Closing") shall occur on November 30, 1999 (the "Scheduled
Closing Date"), or on such earlier date as Purchaser and Seller shall mutually
agree upon, subject to adjournment as hereafter provided; provided, however,
notwithstanding any provision of this Agreement to the contrary, in no event
shall the Closing be adjourned under any provision of this Agreement to a date
later than January 31, 2000. The Closing shall occur at the offices of
Seller's attorney, Xxxxxx, Xxxx & Xxxxxxxx, LLP, at 000 Xxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000 at 10:00 a.m. on the Scheduled Closing Date or at such other
time or place as shall be agreed upon by the parties. The date on which the
Closing shall actually occur is referred to herein as the "Closing Date".
(b) In addition to Seller's rights to adjourn the Closing set
forth elsewhere in this Agreement, each party hereto shall have the one-time
right to adjourn the Scheduled Closing Date (as theretofore adjourned) for up
to seven (7) days in the aggregate.
(c) Provided that Seller has delivered to New York Life
Insurance Company ("New York Life") the letter with the same substance as the
form attached hereto as Schedule 6 on or before October 22, 1999, Seller shall
have the right to postpone the Closing Date up to the date (the "60-Day Date")
that is 60 days after the delivery to New York Life of such letter, if so
required by New York Life, provided that the Closing Date shall not be
extended beyond the 60-Day Date as a result of this Section 3.1(c).
SECTION 4. Termination Option.
4.1. For the purposes of this Agreement, the term "Termination
Option" shall mean the termination of this Agreement by Purchaser pursuant to
any express right of termination granted to Purchaser herein, which
Termination Option shall be exercised by the giving of a written notice of
termination from Purchaser to Escrowee as provided in the applicable
provisions of this Agreement. Upon the proper exercise of the Termination
Option by Purchaser, Purchaser shall be entitled to the Escrow Funds, subject
to the provisions of Section 2.3 and Section 8.2 hereof, and this Agreement
shall be deemed terminated automatically and of no further force or effect and
neither party hereto shall have any further rights or obligations hereunder,
without the necessity for any further notice, instrument or document or action
by or between either of the parties; provided, however, that the indemnities
contained in Section 8.2 and Section 15 hereof shall survive any such
termination, together with all other indemnities, representations, warranties
and obligations which are specifically provided herein to survive any such
termination, in each case for a period of 9 months from the date of
termination.
SECTION 5. Title Exceptions.
5.1. At the Closing, provided that neither Purchaser nor Seller
has terminated this Agreement pursuant to the terms hereof, Seller shall
transfer title to the Premises to Purchaser pursuant to the Deed (as
hereinafter defined), subject only to the following (the "Permitted
Exceptions"): (a) the list of items designated in the pro forma title policy
issued by Commonwealth Land Title Insurance Company ("Commonwealth") which are
set forth on Exhibit "B" annexed hereto and made a part hereof (provided that
the actual title policy may be issued by Commonwealth, First American Title
Insurance Company, or Chicago Title Insurance Company) [collectively, the
"Title Insurer"]; (b) the Violations, if any, referred to in Section 9 hereof;
and (c) all leases and tenancies (as tenants only) affecting the Premises
described on Exhibit "C" annexed hereto and made a part hereof.
5.2. Seller shall, on or prior to the Closing, pay, discharge or
remove of record or cause to be paid, discharged or removed of record, at
Seller's expense, all of the following items: (a) the items listed in the
letter (the "Title Letter") addressed to Seller from Title Insurer set forth
on Exhibit "B-1"; (b) any encumbrances ("Voluntary Liens") which Seller has
granted, suffered or allowed to be placed upon the Premises, including without
limitation mechanics' liens and federal, state and municipal tax liens against
the Seller which are other than Permitted Exceptions (other than those
permitted to be created by tenants under their leases); provided, however,
that a lien or encumbrance created by a tenant that is not permitted under its
respective lease shall not be deemed a Voluntary Lien; and (c) any other
encumbrances ("Non-Voluntary Liens") placed on the Premises which are not (I)
Voluntary Liens or (II) Permitted Exceptions or (III) items listed in the
letter referred to in Section 5.2(a); provided that Seller shall not be
obligated to spend more than the aggregate amount of $[redacted] to omit or
satisfy or discharge (or provide a credit for the funds necessary to
accomplish the same) Non-Voluntary Liens. Without limiting the foregoing,
Seller shall use its best efforts to cause the holder of any mortgages
encumbering the Premises to assign said mortgages to Purchaser's designee or
Lender without charge to Purchaser, provided that Seller shall not be required
to incur any costs, fees or expenses nor to commence any proceedings or
litigation in connection therewith, and in no event shall delivery of such
assignment(s) constitute a condition to the Closing.
5.3. Notwithstanding any provision contained herein to the
contrary, no defect or exception to title shall be deemed a failure of
Seller's obligations entitling Purchaser to exercise the Termination Option
which Seller shall, at its discretion, (a) elect to cure by notice to
Purchaser, and which shall have been cured at or before the Closing or (b)
cause the Title Insurer to omit from the final title insurance policy. Seller
shall have no obligation to expend any funds or otherwise to cure any title
defects, except in each case as set forth in Section 5.2.
SECTION 6. Failure of Seller or Purchaser to Perform.
6.1. (a) If Seller shall be unable to convey title to the
Premises to Purchaser in accordance with this Agreement for reasons other than
default by Seller under this Agreement, then, in such event, as its sole and
exclusive remedies hereunder, Purchaser shall be entitled either (i) to accept
such title as Seller is able to convey, without any credit, reduction,
adjustment or abatement in, to or of the Purchase Price (except as otherwise
provided for specifically herein), or (ii) to terminate this Agreement by
exercise of the Termination Option on or before the Closing Date, it being the
intention of the parties that Purchaser hereby knowingly and with the advice
of counsel waives and relinquishes any and all other rights and remedies at
law or in equity, including, but not limited to, damages or specific
performance.
(b) If Seller shall default in the performance of its
obligations hereunder, subject to Seller's rights to cure such default as
provided in this Agreement (it being understood and agreed that such right to
cure shall not extend past January 31, 2000 as set forth in Section 3.1(a)
hereof), then in such event, as the sole and exclusive remedies of Purchaser
hereunder (other than the remedies of Section 6.1(a)(i), which shall remain
available to Purchaser), Purchaser shall be entitled either (i) to terminate
this Agreement by exercise of the Termination Option on or before the Closing
Date, or (ii) to bring an action for specific performance of the terms of this
Agreement for conveyance of the Premises in accordance with the terms of this
Agreement, it being the intention of the parties that Purchaser knowingly and
with the advice of counsel hereby waives and relinquishes any and all other
rights and remedies at law or in equity, including, without limitation, any
claim for damages. Notwithstanding the foregoing, the indemnity of Seller
contained in Section 15 hereof shall survive any termination of this Agreement
pursuant to Sections 6.1(a) and 6.1(b) for a period of nine (9) months from
the date of the Closing.
6.2. Provided that Purchaser is obligated to close hereunder and
Seller is ready, willing and able to consummate the transactions contemplated
hereby, if Purchaser shall materially default in the performance of any of its
obligations hereunder, then, in such event, as its sole and exclusive remedy
hereunder, Seller shall be entitled to terminate this Agreement and retain the
Escrow Funds as liquidated and agreed damages for Purchaser's default
(excluding all indemnities of Purchaser herein, for which the Escrow Funds may
be subject to Seller's claims for actual Losses as provided herein), it being
agreed by the parties, each knowingly and with the advice of separate counsel,
that it would be difficult to calculate precisely Seller's actual damages in
the event of such a default by Purchaser and that the liquidated damages set
forth herein represent a fair and reasonable estimate by Seller and Purchaser
of the damages (direct, indirect and consequential) which would be suffered by
Seller as a result of Purchaser's default hereunder (excluding Purchaser's
indemnities as aforesaid). If Seller shall elect to terminate this Agreement
pursuant to this Section 6.2, then, in such event, upon Seller's receipt of
the Escrow Funds, this Agreement shall terminate automatically and be of no
further force or effect and neither party hereto shall have any further rights
or obligations hereunder or thereunder without the necessity for any further
notice, instrument, document or action by or between any of the parties;
provided, however, that the indemnities contained in Section 8.2 and Section
15 hereof and all other indemnities of Purchaser provided in this Agreement
shall survive any such termination for a period of nine (9) months from the
date of the Closing and shall be separately and additionally enforceable
and/or recoverable by the non-indemnifying party.
SECTION 7. Representations and Warranties of Seller and Purchaser.
7.1. Seller hereby represents and warrants to Purchaser as follows as of
the date hereof:
(a) Seller is a valid and existing joint venture which is
treated as a general partnership under the laws of the State of New York.
(b) Seller has the full power and authority to enter into and
consummate all transactions contemplated by this Agreement on its part to be
performed, has duly authorized the execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby on its part to be
performed, and has duly executed and delivered this Agreement, and all of the
obligations of Seller hereunder constitute and, upon the execution and
delivery by Seller of the other documents and instruments to be executed and
delivered by Seller pursuant hereto, all obligations of Seller thereunder will
constitute the legal, valid and binding obligations of Seller, enforceable
against it in accordance with their respective terms subject to: (i) the
effect of any bankruptcy, insolvency, reorganization, moratorium, arrangement
or similar laws affecting the enforcement of creditors' rights generally
(including without limitation, the effect of statutory or other laws regarding
fraudulent transfers or preferential transfers), (ii) general principles of
equity, including without limitation, standards of due process, materiality,
good faith, reasonableness and fair dealing, and (iii) the extent to which any
provisions may be deemed unenforceable as contrary to public policy.
(c) The execution, delivery and performance of this Agreement,
and all other agreements, documents and instruments to be executed by Seller
pursuant to this Agreement, when duly executed and delivered by Seller, will
each constitute the binding obligation of Seller; and such execution and
consummation of the transaction contemplated hereby does not (i) breach or
violate any organizational documents of Seller, (ii) to Seller's knowledge,
conflict with or violate or result in a breach of any of the provisions of, or
constitute a default under, any agreement or instrument to which Seller is a
party or by which it or any of its property is bound, (iii) conflict with or
violate any judgment, order, writ, injunction or decree binding on Seller or
any of its property or (iv) to Seller's knowledge (without inquiry), conflict
with or violate any law, rule, regulation or ordinance applicable to Seller or
any of its property.
(d) No approval, authorization, order, license or consent of,
or registration or filing with, any governmental authority or regulatory body
is required in connection with the execution and delivery by Seller of this
Agreement and the consummation by Seller of the transactions contemplated
hereby, other than filing and paying New York State and New York City transfer
tax returns and taxes, respectively.
(e) Seller is solvent and has not filed, nor has there been
filed against it, nor do grounds exist for the filing of, any voluntary or
involuntary petition in bankruptcy or insolvency and no receiver or trustee or
similar custodian has been appointed with respect to any of Seller's property,
and Seller has not received written notice from any bankruptcy court that any
partner of Seller is subject to any voluntary or involuntary bankruptcy or
insolvency proceeding.
(f) To Seller's knowledge, except for the Leases, true and
complete copies of which have, to Seller's knowledge, been delivered to
Purchaser, there are no leases, tenancies, rental agreements, occupancy rights
or possessory rights, and to Seller's knowledge, there are no subtenancies
which Seller has consented to in writing (other than with respect to Suite
1802), in each case affecting any portion of the Premises as of the date
hereof. Suite 2305 is leased to Xxxxx X. Xxxxxxxx, Inc. pursuant to the lease
("Minskoff Lease"), an executed copy of which is annexed hereto as Exhibit "D"
and made a part hereof. With respect to the Leases, to Seller's knowledge,
except as set forth on Exhibit "E" annexed hereto and made a part hereof: (i)
all of the Leases are in full force and effect and none of the Leases has been
modified, amended or extended; (ii) there are no pending summary proceedings
for the eviction of any tenant under the Leases, there are no pending
proceedings or pending written claims by any tenant against Seller for offsets
against rent or additional rent or for damages or other redress, and no tenant
has delivered written notice to Seller that such tenant is disputing (x) the
amount of additional rent or escalation payments due pursuant to such tenant's
Lease or (y) the commencement date or the rent commencement date under its
Lease which dispute remains unresolved; (iii) Seller has not received any
written notice from any tenant claiming that Seller is in default of any of
its obligations under any Lease, which default has not been cured; (iv) Seller
has not sent any written notice, except as set forth on Exhibit "E", to any
tenant claiming that such tenant is in default of any of its obligations under
any Lease, which default remains uncured; (v) except as set forth on Exhibit
"E" there are no delinquencies in any rental payments due under any of the
Leases; (vi) Exhibit "F" attached hereto constitutes a true, correct and
complete list of the security deposits held by Seller with respect to the
Leases (the "Security Deposits"), and the bank(s) and account number(s) where
such security deposits are maintained and, in the case of each Letter of
Credit, the current expiration date thereof; (vii) no renewal or extension
options have been granted to any tenant other than those set forth in the
Leases; (viii) no tenant or other person has the option to purchase the
Premises or a right of first offer or refusal to do so; (ix) no brokerage
commission or other similar compensation is now or hereafter will become due
or payable with respect to or on account of any of the Leases other than (A)
the brokerage commissions set forth on Exhibit "I" and (B) any such amounts
which may become due and payable as a result of the exercise of any expansion
or renewal option following the date hereof or as set forth in the Mendik
Management Agreement attached hereto as Exhibit "I"; (xi) no tenant has
delivered written notice of its termination of its Lease (or the surrender of
any space demised thereunder) or of its intention to so terminate its Lease or
surrender any space; (xii) except for collateral assignments of leases and
rents given to any existing mortgage holder of the Property (which Seller will
use its best efforts, subject to the limitations of Section 5.2 hereof, to
cause to be assigned to Purchaser at Closing or, if not so assigned, which
Seller will cause to be released of record), Seller has not given any other
assignment, pledge or encumbrance of its interest in the Leases or the rents
payable thereunder; (xiii) all tenant work, free rent and any other tenant
inducement obligations under the Leases have been satisfied by Seller, except
as set forth on Exhibit "G" attached hereto; (xiv) attached as Exhibit "E" is
a copy of the rent roll with respect to the Leases which is true, correct and
complete; (xv) the dates set forth on the attached "Exhibit "ZZ" as the
"commencement date" and the "rent commencement date" (to the extent Seller has
such information) and the dates set forth on the attached rent roll as the
"expiration date" accurately reflect the applicable tenant's commencement
date, rent commencement date and expiration date under its Lease; and (xvi)
Seller has not received written notice of the non-renewal of any Letter of
Credit posted as a Security Deposit under the Leases.
(g) All furnishings, fixtures, machinery, equipment, supplies,
tools and other items of personal property owned by Seller and located at and
used in connection with the Premises as listed on Exhibit "H" annexed hereto
and made a part hereof, are free and clear of all security interests,
conditional sales agreements and title retention agreements other than those
described on Exhibit "H".
(h) Seller is not a "foreign person" within the meaning of
Section 1445 of the Internal Revenue Code, as amended.
(i) To Seller's knowledge, Seller has not received written
notice of any condemnation or eminent domain proceeding pending or threatened,
in writing, against the Premises or any part thereof.
(j) To Seller's knowledge, Exhibit "I" annexed hereto and made
a part hereof is a list of all written agreements affecting the Premises as of
the date hereof to which Seller is a party with respect to brokerage
commissions, finder's fees or real estate agent's fees for the execution of
the Leases.
(k) Except for the Service Contracts, and except for the
Curtain Wall Agreement and Sidewalk Bridge Agreement (the Curtain Wall
Agreement and Sidewalk Bridge Agreement are hereinafter collectively referred
to as the "Exterior Agreements"), true copies of which are annexed hereto as
Exhibit "J", to Seller's knowledge Seller is not a party to any written
contracts (including, without limitation, any architect's or engineering
agreement) which remain to be performed with respect to any improvements to
the Premises, and the Service Contracts, the Curtain Wall Agreement and the
Sidewalk Bridge Agreement are in full force and effect, without written notice
of default to or by any party. Except as set forth in the next sentence, no
additional amounts shall be payable with respect to the Exterior Agreements.
The work contemplated by the Exterior Agreements is intended to be completed
on or before the Closing, but if it is not so completed, Seller shall at the
Closing (i) use its best efforts (without Seller being required to incur any
fees, costs or expenses nor to commence any proceeding or litigation in
connection therewith), to deliver to Purchaser a consent to the assignment of
the Exterior Agreements to Purchaser from the other parties to the Exterior
Agreements (it being agreed that in no event shall delivery of such consent
constitute a condition to Closing), and in the event of such consent, (ii)
assign the Exterior Agreements to Purchaser and the same shall be assumed by
Purchaser by inclusion in Exhibit "R" annexed hereto and made a part hereof,
and (iii) Seller shall give Purchaser a credit against the Purchase Price for
the balance of the stated cost of completion. If consent to such assignment
shall not be obtained, Seller agrees at Purchaser's request and at Purchaser's
expense, to enforce any applicable provision of the Exterior Agreements after
the Closing for the benefit of Purchaser. The preceding sentence shall survive
the Closing. Attached hereto as Schedule 3 is a consent to the transfer of the
warranties under the Curtain Wall Agreement, which is approved by Purchaser,
and which warranties shall in all events be assigned to Purchaser at Closing
by inclusion in Exhibit "R" attached hereto.
(l) To Seller's knowledge, there is no litigation, claim,
action or proceeding pending or threatened against Seller or the Premises,
that, if determined adversely to Seller, would result in any material adverse
change in the business, operation, affairs or condition of the Premises, in
any case which is uninsured or would materially and adversely affect the
enforceability of this Agreement or any other document or instrument executed
or to be executed in connection herewith or the ability of Seller to perform
its obligations hereunder or consummate the transactions contemplated hereby.
No written material dispute currently exists under the Exterior Agreements or
any of the Service Contracts to Seller's knowledge. To Seller's knowledge,
Exhibit "K" annexed hereto and made a part hereof, sets forth all litigation,
claims, actions or proceedings currently affecting Seller or the Premises
(including, without limitation, litigation with building employees and
tenants).
(m) To Seller's knowledge, except as disclosed on Exhibit "L"
hereto, (i) Seller has not received any written notice, demand, letter, claim
or request for information regarding the presence of Hazardous Substances or
liability under any Environmental Law with respect to the Premises; and (ii)
Seller has not received any written notice (the subject of which has not been
fully cured) that the Premises is currently subject to any orders, decrees,
injunctions or any other proceedings or requirements imposed by any
governmental authority or third party pursuant to any Environmental Law.
(n) To Seller's knowledge, the insurance policies maintained by
Seller covering the Premises have limits of coverage, deductible amounts and
expiration dates (and such insurance policies are in full force and effect)
sufficient to cover Seller's financial obligations to restore the Premises or
credit Purchaser pursuant to Section 10.
(o) To Seller's knowledge: Subject to the provisions of Section
14.4, Exhibit "M" is a true correct and complete list of all employees at the
Building and their wages, and a list of all employment, union or other similar
agreements or any pension, profit-sharing, insurance or other employee benefit
plans to which Seller is a party and relating to the Premises or the
employees; and Seller has not received any written notice claiming a default
by Seller under any of the aforementioned employee agreements.
(p) To Seller's knowledge, Exhibit "N" sets forth a true,
correct and complete list of all pending tax certiorari proceedings, the name
of the counsel representing Seller with respect thereto and the status of such
proceedings.
(q) To Seller's knowledge, Seller has not received written
notice of any insolvency or bankruptcy proceeding involving any tenant,
licensee or occupant (or guarantor of the same) under any Lease.
[language redacted]
7.2. Except as set forth in Section 7.1 hereof or in other
express provisions of this Agreement, Seller makes no representation, warranty
or covenant of any kind with respect to: the Premises; any environmental
conditions at, or with respect to, the Premises; the compliance or
non-compliance of the Premises or any tenant-occupied space with the
provisions of any applicable local, municipal, state or federal statute, law,
ordinance, rule or regulation (including administrative rules and
regulations), including without limitation the zoning regulations or other
governmental requirements applicable to, or with respect to, the Premises or
the Americans With Disabilities Act ("ADA"); the site or physical conditions
applicable to, or with respect to, the Premises; the Leases; or any other
matters whatsoever affecting the title, use, enjoyment, occupancy, operation,
management, leasing, or condition to, of or with respect to the Premises or
any part thereof.
7.3. Purchaser hereby represents and warrants to Seller as follows:
(a) Purchaser is a limited partnership duly organized, validly
existing and in good standing under the laws of Delaware.
(b) Purchaser has the full power and authority to enter into
and consummate all transactions contemplated by this Agreement on its part to
be performed, has duly authorized the execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby on its part to be
performed, and has duly executed and delivered this Agreement, and all of the
obligations of Purchaser hereunder constitute and, upon the execution and
delivery by Purchaser of the other documents and instruments to be executed
and delivered by Purchaser pursuant hereto, all obligations of Purchaser
thereunder will constitute the legal, valid and binding obligations of
Purchaser, enforceable against it in accordance with their respective terms
subject to (i) the effect of any bankruptcy, insolvency, reorganization,
moratorium, arrangement or similar laws affecting the enforcement of
creditors' rights generally (including without limitation, the effect of
statutory or other laws regarding fraudulent transfers or preferential
transfers), (ii) general principals of equity, including without limitation,
standards of due process, materiality, good faith, reasonableness and fair
dealing, and (iii) the extent to which any provisions hereof may be deemed
unenforceable as contrary to public policy.
(c) The execution, delivery and performance of this Agreement,
and all other agreements, documents and instruments to be executed by
Purchaser pursuant to this Agreement, when duly executed and delivered by
Purchaser, will each constitute the binding obligation of Purchaser, and such
execution and consummation of the transaction contemplated hereby does not (i)
contravene the operating or partnership agreement of Purchaser or breach or
violate any organizational documents of Purchaser, (ii) to Purchaser's
knowledge, conflict with or violate or result in a breach of any of the
provisions of, or constitute a default under, any agreement or instrument to
which Purchaser is a party or by which it or any of its property is bound,
(iii) conflict with or violate any judgment, order, writ, injunction or decree
binding on Purchaser or any of its property or (iv) to Purchaser's knowledge
(without inquiry), conflict with or violate any law, rule, regulation or
ordinance applicable to Purchaser or any of its property.
(d) As of the Closing Date, Purchaser shall have inspected the
Premises and, as a result of such inspection, shall be fully familiar with the
access to and from the Premises, the present physical and financial condition
of the Premises and the present state of repair of the Premises. Subject to
the provisions of this Agreement, at the Closing, Purchaser shall accept the
Premises "AS IS", "WHERE IS" and "WITH ALL FAULTS" (whether latent, patent or
detectable or not) on the Closing Date, without any reduction in the Purchase
Price for any change in the physical or financial condition occurring from and
after the date hereof. Purchaser acknowledges and agrees that (i) except as
otherwise specifically set forth in this Agreement, neither Seller nor any of
its direct or indirect principals, members, joint venturers, partners or
affiliates, nor its or their employees, agents, brokers and representatives
(collectively, "Seller and its Representatives") nor any other person, has
made any representation, warranty, promise or covenant, express or implied,
with respect to the Premises, the fitness, merchantability, suitability or
adequacy of the Premises for any particular purpose, any environmental
condition at or with respect to the Premises, the compliance or non-compliance
of the Premises or any tenant-occupied space under the provisions of the ADA,
the site or physical conditions applicable to or with respect to the Premises,
the zoning regulations or other governmental requirements applicable to or
with respect to the Premises, the Leases, or any other matters whatsoever
affecting the title, use, enjoyment, occupancy, operation, management,
leasing, ownership or condition to, of or with respect to the Premises, or any
part thereof, and (ii) neither Seller nor any of its Representatives nor any
other person will have, or be subject to, any liability to Purchaser or any
other person resulting from the distribution to Purchaser, or Purchaser's use
of, any information pertaining to the Premises which is not specifically set
forth in this Agreement. Without limiting the generality of the foregoing,
Purchaser further acknowledges and agrees that, except as otherwise
specifically set forth in Section 7.1(m) hereof (subject to the limitations of
Sections 7.5 and 19.10), no representation, warranty, covenant or indemnity
has been made or will be given to Purchaser or any other person in respect of
any environmental liability with respect to any dangerous, toxic or hazardous
wastes, materials, pollutants or substances ("Hazardous Materials"), as such
terms are defined in federal, state and local environmental laws and
regulations, including, without limitation, the United States Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended
(collectively, "Environmental Laws"). Purchaser also acknowledges and agrees
that, except as otherwise specifically set forth in Section 7.1(m) hereof
(subject to the limitations of Section 7.5 and Section 19.10), in no event
whatsoever shall Seller or its Representatives have any liability to
Purchaser, or otherwise, with respect to Hazardous Materials affecting the
Premises or Environmental Laws. Purchaser also represents that, at the
Closing, Purchaser will have had sufficient opportunity to conduct such
investigations of and with respect to the Premises as it has deemed necessary
and advisable. Purchaser's representations, warranties, acknowledgments and
agreements set forth in this Section 7.3(d) shall survive the Closing.
(e) No approval, authorization, order, license or consent of,
or registration or filing with, any governmental authority or regulatory body
is required in connection with the execution and delivery by Purchaser of this
Agreement or the consummation by Purchaser of the transactions contemplated
hereby.
(f) There is no litigation, claim or proceeding pending or, to
Purchaser's knowledge, threatened in writing against Purchaser in any court or
before any governmental agency or instrumentality that, if determined
adversely to Purchaser, would materially and adversely affect the
enforceability of this Agreement or any other document or instrument executed
or to be executed in connection herewith or the ability of Purchaser to
perform its obligations hereunder or consummate the transactions contemplated
hereby.
(g) Purchaser is solvent and has not filed, nor has there been
filed against it, nor do grounds exist for the filing of, any voluntary or
involuntary petition in bankruptcy or insolvency and no receiver or trustee or
similar custodian has been appointed with respect to its property or any
material portion thereof.
(h) As of the date hereof, Purchaser has available to it
sufficient funds with which to pay the Purchase Price and to meet its other
financial obligations to Seller under this Agreement. The obligations of
Purchaser hereunder are not subject to any contingency for the benefit of
Purchaser regarding the availability of financing (whether secured or
unsecured) to provide funds to Purchaser to consummate the transactions
contemplated hereby.
(i) Except as specifically set forth in this Agreement,
Purchaser has not been induced by, and has not relied upon, any
representation, warranty, promise or statement made by Seller or any of its
Representatives. Purchaser's representations set forth in this Section 7.3(i)
shall survive the Closing.
7.4. If at or before the Closing Purchaser becomes aware that
any representation made by Seller in this Section 7 is materially
inaccurate, Purchaser shall promptly send written notice thereof to Seller. In
such event, prior to or at the Closing, at Seller's option the Closing shall
be adjourned for five (5) business days, during which xxxx Xxxxxx shall have
the right to give notice to Purchaser ("Seller's Section 7 Cure Notice") that
it elects to take such action as is necessary to cause such representation to
be true ("Section 7 Cure") within thirty (30) days following Seller's Section
7 Cure Notice ("Section 7 Cure Period") (it being understood that Seller shall
have no obligation to do so), and in such event the Closing shall be adjourned
for up to an additional thirty (30) days (or any shorter period which Seller
may specify in Seller's Section 7 Cure Notice). If Seller does not timely give
a Seller's Section 7 Cure Notice, or effect such Section 7 Cure within such
30-day period, Purchaser shall either (x) terminate this Agreement by exercise
of its Termination Option on or before the Closing Date or (y) waive (or be
deemed to waive) objection to such misrepresentation and close this
transaction without (i) abatement of the Purchase Price, (ii) credit or
allowance of any kind or (iii) any claim or right of action against Seller for
damages or otherwise in connection therewith. As used in this Agreement, the
words "to Purchaser's knowledge" or words of similar import shall be deemed to
mean, and shall be limited to, the actual (as distinguished from implied,
imputed or constructive) knowledge of any one or more of Xxxxxx X. Xxxxxxxx
III, Xxxxxxx Xxxxxxx and Xxxxx Xxxxxxx.
7.5. Seller's representations and warranties set forth in this
Section 7 shall survive the Closing for a period of nine (9) months
following the Closing; provided, however, that any claim that there has been a
breach of such representations and warranties ("Seller's Breach") shall be
deemed forever waived by Purchaser if (a) such breach is actually known to
Purchaser on or before the Closing and not disclosed to Seller in writing
(subject to Section 7.4), and (b) if such breach is not actually known by
Purchaser on or before the Closing and a claim is not made in writing by
Purchaser within nine (9) months following the Closing Date. In no event shall
Purchaser have any right or claim to rescind the purchase of the Premises
after the Closing by reason of any Seller's Breach, but Purchaser shall be
limited solely to recover damages (excluding punitive or consequential
damages), which shall be paid solely from the Representations and Warranties
Holdback (as hereinafter defined).
7.6. Holdback for Survival of Seller's Representations, Warranties and
Indemnities.
(a) At the Closing, Purchaser shall deliver the sum of [redacted]
(the "Representations and Warranties Holdback") to Warranties Holdback
Escrowee (as hereafter defined), by wire transfer, in immediately available
funds to Citibank, 000 Xxxxxxxx, Xxx Xxxx, XX, 00000, ABA #000000000,
Attention: Xxxx XxXxxxxxx, Private Banking Division, For the Account of Fried,
Frank, Harris, Xxxxxxx & Xxxxxxxx, Account Number: 00000000, Reference:
Reckson Warranties Holdback, on account of the balance of the Purchase Price
which, subject to the terms and conditions set forth in this Section 7.6, is
to be delivered not later than nine (9) months after the Closing, except for
the Remy Amerique Commission Funds (as defined herein), which, subject to the
terms and conditions set forth herein, is to be paid to Seller, not later than
December 31, 2000 (together with all interest as provided below). The
Representations and Warranties Holdback shall be held by Warranties Holdback
Escrowee to secure the payment of the Surviving Warranties (as hereinafter
defined). "Surviving Warranties" means (i) any breach of the representations,
warranties, covenants and indemnities of Seller contained in Section 7
(provided, however, in no event shall any claim be asserted under this
Paragraph 7.6 with respect to any physical matter or physical condition of or
relating to the Premises), Section 14.1, Section 14.2(a), Section 15 and
Exhibits "Q" and "R" annexed hereto and made a part hereof which expressly
survive the Closing, (ii) the payment by Seller of one half (1/2) of that
certain brokerage commission (the "Remy Amerique Commission "), which is
payable to Xxxxx Associates LLC (the "Broker") in connection with that certain
First Amendment to Lease (the "Remy Amerique Expansion Agreement"), dated as
of September 1999, between Seller, as Landlord and Remy Cointreau Amerique,
Inc., as tenant (the "Remy Amerique Tenant"), such one-half (1/2) commission
being in the amount of [redacted] (the "Remy Amerique Commission Funds"), but
only if, as and when such Remy Amerique Commission becomes payable to Broker
by reason of the failure by the Remy Amerique Tenant to exercise, on or before
November 30, 2000 (the "Remy Payment Date"), (ii) the Remy Amerique Tenant's
right to cancel its lease at the Building as set forth in such lease as of the
date of this Agreement (the "Remy Cancellation Right"), and (iii) any
adjustments due to Purchaser after Closing pursuant to Section 13 hereof (all
of the items described in clauses (i) through (iii) are collectively, the
"Surviving Warranties"), and which Surviving Warranties result in an aggregate
amount of damages or other amounts payable to Purchaser in excess of
[redacted] (the "Warranties Holdback Deductible"), provided, however, that the
payment of the Remy Amerique Commission in accordance with the further terms
and conditions of this Section 7.6., shall not be subject to the Warranties
Holdback Deductible. As used in this Section 7.6, the term Warranties Holdback
Escrowee shall mean and refer to Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx.
(b) Warranties Holdback Escrowee shall hold the Representations
and Warranties Holdback funds (the "Warranties Holdback Funds") in escrow in
any "Permitted Investment" (as hereinafter defined) designated by Seller in
writing from time to time, or, if Seller does not designate a Permitted
Investment, in an interest-bearing account in a New York Clearing House Bank
or in some other Permitted Investment agreed to in writing by the Seller and
Purchaser and acceptable to Warranties Holdback Escrowee (the "Warranties
Holdback Account") until the Warranties Holdback Termination Date (as
hereinafter defined), and shall pay over or apply the Warranties Holdback
Funds in accordance with the further provisions of this Section 7.6; provided,
however, that Purchaser agrees that any and all interest earned on the
Warranties Holdback Funds shall be paid to the Seller at the Warranties
Holdback Termination Date and that Purchaser shall not be entitled to make any
claim for or against such interest in connection with a breach by Seller of
any of the Surviving Warranties or otherwise. If Seller receives such
interest, Seller shall pay all income taxes owed in connection therewith. The
employer identification number of Seller set forth on the signature page
hereof. Warranties Holdback Escrowee shall not be liable to Purchaser or
Seller for any loss occasioned by any deposit of the Warranties Holdback Funds
made in accordance with this Section 7.6(b). The term "Permitted Investment"
shall mean any of the following: (i) Institutional Service Shares of Federated
New York Municipal Cash Trust or other New York triple tax-free money market
funds of comparable quality, (ii) short-term New York triple tax-free
investments rated not less than A-1 by Standard & Poor's Ratings Services or
P-1 by Xxxxx'x Investors Service, Inc., or (iii) short-term United States
Treasury Bills or other obligations of or guaranteed by the United States
government.
(c) Subject to, and following in compliance with, the
provisions of Section 7.6(d) hereof, Warranties Holdback Escrowee shall
deliver to Purchaser the Warranties Holdback Funds (excluding interest
thereon) only to the extent that the amount of damages or other amounts due to
Purchaser as provided hereunder and as set forth in all Purchaser's Warranties
Demands (as hereinafter defined) exceed the Warranties Holdback Deductible, at
the expiration of ten (10) business days following Warranties Holdback
Escrowee's receipt of Purchaser's written demand ("Purchaser's Warranties
Demand") therefor from Purchaser or Purchaser's attorneys stating in
reasonable detail that Seller has breached any of the Surviving Warranties
and/or otherwise owes money to Purchaser in connection with the Remy Amerique
Commission (and, in the case of the Remy Amerique Tenant, stating that the
Remy Amerique Tenant has not timely exercised the Remy Cancellation Right )
and/or pursuant to the Surviving Warranties after the Closing, in accordance
with Section 13 hereof (but neither the inclusion of, or reference to, nor any
payment in connection with Section 13 hereof, shall extend the Warranties
Holdback Termination Date), and specifying the amount Purchaser is entitled to
as a result thereof in reasonable detail, and Warranties Holdback Escrowee
shall deliver all accrued interest with respect to the funds, so disbursed to
Seller. Simultaneously with Purchaser's delivery of Purchaser's Warranties
Demand to Warranties Holdback Escrowee, Purchaser shall deliver a copy of
Purchaser's Warranties Demand to Seller.
(d) Subject to the provisions of Section 7.6(f) and Section
7.6(g) hereof, if Warranties Holdback Escrowee receives Purchaser's Warranties
Demand pursuant to and in accordance with Section 7.6(c) hereof, then, in such
event, prior to releasing any Warranties Holdback Funds, Warranties Holdback
Escrowee shall deliver a copy of Purchaser's Warranties Demand to the Seller
within five (5) business days after receipt thereof by Warranties Holdback
Escrowee. If Warranties Holdback Escrowee shall not have received a written
objection by Seller or Seller's attorneys to the proposed payment by the close
of business on the tenth (10th) business day following the date of Purchaser's
Warranties Demand, then, in such event, Warranties Holdback Escrowee is hereby
authorized and directed to make the payment set forth in such Purchaser's
Warranties Demand in excess of the Holdback Deductible on or after the
eleventh (11th) business day following the date of such Purchaser's Warranties
Demand. If Warranties Holdback Escrowee shall have received a written
objection from either party or their attorneys before such payment, then, in
such event, Warranties Holdback Escrowee shall continue to hold the Warranties
Holdback Funds until otherwise directed by written instructions from both of
the parties hereto or by a final unappealable judgment of a court of competent
jurisdiction; provided, however, that Warranties Holdback Escrowee shall have
the right, at any time, to deposit the Warranties Holdback Funds with any
court of competent jurisdiction and thereby be relieved and discharged of any
further obligations or liability under this Agreement. Warranties Holdback
Escrowee shall give written notice of any such deposit to Seller and
Purchaser. Warranties Holdback Escrowee shall be entitled to rely upon the
authenticity of any signature and/or the validity of any writing received by
Warranties Holdback Escrowee pursuant to, or otherwise relating to, this
Agreement. Any writing signed by any two (2) of the "parties of the first
part" of Seller, on behalf of Seller, shall be sufficient to bind Seller, and
Escrowee shall be entitled to rely thereon. The "parties of the first part" of
Seller [language redacted].
(e) The parties acknowledge and agree that (i) Warranties
Holdback Escrowee, in its capacity as the holder of the Warranties Holdback
Funds hereunder, is acting solely as a stakeholder at the parties' request and
for their convenience; (ii) although Warranties Holdback Escrowee, in its
capacity as attorney, acts as the attorney for Purchaser in connection with
the transactions contemplated herein, Warranties Holdback Escrowee shall not
be deemed to be the agent of either of the parties hereto as holder of the
Warranties Holdback Funds, (iii) any conflict of interest that may exist
because of Escrowee's representation of Purchaser hereunder as attorney is
hereby waived; (iv) Warranties Holdback Escrowee shall not be liable to either
of the parties hereto or to any third-party for any act or omission on its
part as Warranties Holdback Escrowee unless due to Warranties Holdback
Escrowee's gross negligence or willful misconduct and (v) Warranties Holdback
Escrowee or any of its members or employees shall be permitted to act as
counsel for Purchaser in any dispute or question as to the disbursement of the
Warranties Holdback Funds or any other matter arising under this Agreement.
Seller and Purchaser, jointly and severally, shall indemnify, defend and hold
harmless Warranties Holdback Escrowee from and against any and all losses,
liabilities, costs, claims, damages or expenses (including, without
limitation, reasonable attorneys' fees and costs) which may be incurred or
suffered by Warranties Holdback Escrowee in connection with the performance of
Warranties Holdback Escrowee's duties hereunder, excepting Warranties Holdback
Escrowee's gross negligence or willful misconduct. As between Seller and
Purchaser, the party responsible for the acts or omissions giving rise to the
foregoing indemnity obligation, shall be liable to the other party for
contribution or reimbursement.
(f) At such time (at or subsequent to the Closing) as Seller has
delivered to Purchaser (with copies to Warranties Holdback Escrowee)
Satisfactory Tenant Estoppels (as hereinafter defined) from tenants occupying
at least [language redacted] of the net leasable space under lease at the
Premises as of the date hereof (excluding the space leased by [language
redacted], Seller shall be entitled to the immediate release and the
Warranties Holdback Escrowee shall pay to Seller, to the extent then held in
escrow, the sum of [redacted] from the Warranties Holdback Funds (together
with interest thereon) less the amount by which all Warranties Demands
previously made by Purchaser (if any) exceed [redacted] (e.g., if Purchaser
had made several Warranties Demands the aggregate value of which is
[redacted], only [redacted] would be released to Seller). For purpose of
clarification, Seller's Estoppels do not count in computing the [language
redacted] threshold.
(g) Except to the extent a Purchaser's Warranties Demand was
delivered in accordance with the terms hereof, and has not been resolved by
the mutual agreement in writing by Seller and Purchaser, and except for the
Remy Amerique Commission Funds [redacted] which shall continue to be held by
Warranties Holdback Escrow Agent to secure payment of the Remy Amerique
Commission until December 31, 2000 (the "Remy Amerique Termination Date"), at
the expiration of nine (9) months from the Closing ("Warranties Holdback
Termination Date"), Warranties Holdback Escrow Agent shall deliver all
remaining Warranties Holdback Funds [excluding the Remy Amerique Commission
Funds, unless such funds have previously been released in accordance with the
terms hereof] (with all earned interest thereon not previously disbursed to
Seller) to Seller, less the amount by which all Warranties Demands exceed
[redacted]. If at any time that the Remy Amerique Funds would otherwise be
payable to Purchaser, there shall not be sufficient funds therefor in the
Warranties Holdback Funds, Seller shall promptly pay the same to Purchaser
upon Purchaser's delivery of its demand and all other required evidence as
provided in subparagraph (c) above. Anything contained in this Agreement to
the contrary notwithstanding, Purchaser shall have no obligation to pay to
Seller the amount of any Warranties Holdback Funds that have been disbursed to
Purchaser in accordance with this Section 7.6 in respect of Warranties
Demands.
(h) Purchaser agrees that to the extent Warranties Holdback
Funds, together with any earned interest thereon, are released (the "Released
Funds") to Seller in accordance with Section 7.6(f) or Section 7.6(g),
Purchaser shall not be entitled to make any claim for or against any of the
Released Funds in the possession of Seller or any Seller's Principal (as
hereinafter defined) in connection with a breach by Seller of any of the
Surviving Warranties or otherwise.
(i) Anything contained in this Section 7.6 to the contary
notwithstanding, if (A) on or before the Warranties Holdback Termination Date,
the Remy Amerique Tenant shall exercise the Remy Cancellation Right, then the
Remy Amerique Funds shall continue to be held by the Warranties Holdback
Escrowee as part of the Warranties Holdback Funds as if all references in this
Section 7.6 to the Remy Amerique Commission were omitted herefrom, (B) after
the Warranties Holdback Termination Date and on or before the Remy Payment
Date, the Remy Amerique Tenant shall exercise the Remy Cancellation Right,
then the Remy Amerique Funds shall be released to Seller (and Purchaser shall
have no right to object to such release to Seller), and (C) as of the Remy
Payment Date, the Remy Amerique Tenant shall have failed to exercise the Remy
Cancellation Right, then the Remy Amerique Funds shall be released to
Purchaser (and Seller shall have no right to object to such release to
Purchaser).
(j) The provisions of this Section 7.6 shall survive the Closing.
7.7. [section redacted]
(b) [section redacted]
(c) Chase Holdback Escrowee shall hold the Chase Funds in
escrow for investment in any Permitted Investment designated by Purchaser in
writing from time to time, or, if Purchaser has not designated a Permitted
Investment, in an interest-bearing account in a New York Clearing House Bank
or in some other investment acceptable to Chase Holdback Escrowee and
Purchaser ("Chase Holdback Account"), and shall pay over or apply the Chase
Funds in accordance with the provisions of this Section 7.7. The Purchaser
shall pay all income taxes owed in connection with all interest. The employer
identification numbers of Seller and Purchaser are set forth on the signature
page hereof. Chase Holdback Escrowee shall not be liable to Purchaser or
Seller for any loss occasioned by any deposit of the Chase Funds made in
accordance with this Section 7.7(c).
(d) The parties acknowledge and agree that (i) Chase Holdback
Escrowee, in its capacity as holder of the Chase Funds hereunder, is acting
solely as a stakeholder at the parties' request and for their convenience; and
(ii) although Chase Holdback Escrowee, in its capacity as attorney, acts as
the attorney for Purchaser in connection with the transactions contemplated
herein, Chase Holdback Escrowee shall not be deemed to be the agent of either
of the parties hereto as holder of the Chase Funds, (iii) any conflict of
interest that may exist because of Escrowee's representation of Purchaser
hereunder as attorney is hereby waived (iv) Chase Holdback Escrowee shall not
be liable to either of the parties hereto or to any third-party for any act or
omission on its part as Chase Holdback Escrowee unless due to Chase Holdback
Escrowee's gross negligence or willful misconduct; and (v) Chase Holdback
Escrowee or any of its members or employees shall be permitted to act as
counsel for Purchaser in any dispute or question as to the disbursement of the
Chase Holdback Funds or any other matter arising under this Agreement. Seller
and Purchaser, jointly and severally, shall indemnify, defend and hold
harmless Chase Holdback Escrowee from and against any and all losses,
liabilities, costs, claims, damages or expenses (including, without
limitation, reasonable attorneys' fees and costs) which may be incurred or
suffered by Chase Holdback Escrowee in connection with the performance of
Chase Holdback Escrowee's duties hereunder, excepting Chase Holdback
Escrowee's gross negligence or willful misconduct. As between Seller and
Purchaser, the party responsible for the acts or omissions giving rise to the
foregoing indemnity obligation, shall be liable to the other party for
contribution or reimbursement.
(e) Except for the proration of monthly rent for the month of
the Closing as provided in Section 7.7(b), there shall be no adjustment
between Seller and Purchaser for arrearages or any other matters with respect
to the Chase Lease. Except as hereinafter expressly set forth, Seller shall,
at all times prior to and after the Closing, have the sole management and
control of all aspects of the pending Chase litigation (Index No. 112750199,
Supreme Court of the State of New York, County of New York, and related
proceedings), including all arbitration proceedings and settlement
negotiations, and all appeals (collectively, "Chase Litigation"), and
Purchaser shall cooperate with Seller in connection therewith and, at Seller's
request, shall participate in Seller's settlement negotiations. From and after
the Closing, Purchaser hereby irrevocably designates and authorizes Seller,
its successor and assigns and its and their attorneys to continue, conduct and
settle the Chase Litigation in Seller's name, and/or Purchaser's name, place
and stead (as the then owner of the Premises and the successor to Landlord
under the Chase Lease), as Seller shall determine, and Purchaser irrevocably
assigns and sets over to Seller, its successors and assigns all right, title
and interest in any and all rights, remedies, privileges, rents (including all
fixed, minimum, additional, operating and tax escalation, and "pass-through"
rent), issues, profits, security deposits, proceeds, claims, actions,
proceedings, awards, settlements and recoveries whatsoever under or arising
out of the Chase Lease and/or Chase Litigation, with full power and authority
to execute, acknowledge and deliver any and all settlement agreements,
stipulations, dismissals, releases, lease terminations and surrenders and all
other instruments and documents in connection with the Chase Lease and Chase
Litigation as Seller shall elect in its sole and absolute discretion, and
Purchaser shall join in any of the same at Seller's request (so long as
Purchaser shall incur no liability thereunder); provided, however, any
settlement or agreement with Chase which does not require termination by Chase
of occupancy of the entire premises under the Chase Lease on or before July
31, 2000 shall require Purchaser's prior written consent. Seller shall be
responsible for all costs, fees and expenses of the Chase Litigation,
including any adverse judgments, except with respect to any acts or omissions
of Purchaser, its agents and representatives, and its and their successors and
assigns, from and after the Closing.
(f) The provisions of this Section 7.7 shall survive the Closing.
SECTION 8. Inspection of the Premises.
8.1. At all times prior to the Closing Date (unless this
Agreement is terminated prior to such date), upon reasonable notice to Seller
or its representatives (including without limitation, Xxxxxxx & Xxxxxxxxx,
Inc. ("C&W")), Purchaser and such agents and representatives of Purchaser
("Authorized Representatives") as shall have been identified to Seller, shall
have the right, subject to the rights of tenants and other occupants at the
Premises (including, without limitation, subject to and in accordance with the
terms of the Leases), to enter upon the Premises to inspect and examine the
same, subject to the further provisions hereof; provided, however, that (a)
Purchaser shall take all measures to minimize any interference or
inconvenience with Seller's or any tenant's or occupant's use or operation of
the Premises, including conducting inspections and tests after normal business
hours; (b) all inspections shall be accomplished in an expeditious, safe and
businesslike manner in accordance with all applicable law; (c) Seller, any
tenant and/or their representatives or employees may, at Seller's option,
accompany Purchaser or any Authorized Representatives; (c) Purchaser shall not
alter or destroy the Premises in any manner whatsoever; (e) Purchaser shall
promptly deliver to Seller copies of all data, information, tests, studies and
reports generated by or for Purchaser relating to the results of such
inspections if this Agreement is terminated; and (f) subject to Seller's prior
written consent, as a further condition precedent to making any physically
intrusive inspection or examination of the Premises or to bringing any
equipment or materials on the Premises, Purchaser and all contractors engaged
by Purchaser shall obtain and maintain at all times at their sole cost and
expense (i) liability insurance in the amount of $2,000,000 for property
damage coverage and in the amount of $5,000,000 for personal and bodily injury
coverage, which insurance shall name Seller (and, at its option, its
constituent joint venturers or partners) as additional insured parties, and
(ii) with respect to any Authorized Representatives (and all of their
employees and agents), workers' compensation and disability insurance, as
required by law. Purchaser and the Authorized Representatives shall have the
right from time to time, upon reasonable notice, to examine the books,
records, accounts and other material information with respect to the Premises
only. Purchaser shall provide to Seller certificates of insurance evidencing
such coverage prior to entering upon the Premises as aforesaid for the purpose
of making any such physically intrusive investigation, such certificates to
provide that the insurance evidenced thereby may not be changed or canceled
except upon thirty (30) days' written notice to Seller. It is understood and
agreed that except as set forth in Section 4.1 hereof Purchaser's satisfaction
with such inspection shall not constitute or be deemed to constitute a
condition to Purchaser's obligations hereunder.
Without limiting the foregoing, the following shall apply to any
communications with tenants, property managers or employees of or at the
Premises:
(A) From and after the date hereof, Purchaser shall be entitled
to communicate questions or requests for information to and from (I) "New York
Life" or (II) tenants of the Premises, and the Premises' managers and
employees, as reasonably required by Purchaser, in any case only upon prior
notice to Seller and in the presence of one or more representatives of Seller
(as Seller shall determine from time to time, which may be C&W), provided that
Seller or its representative(s) is available to be present within (two) 2
business days of any such request, unless Seller has waived the right to be
present in writing in a specific case. Notwithstanding any provisions
contained herein to the contrary, Purchaser covenants and agrees that it will
not enter into a deal with New York Life with respect to a new loan secured by
the Premises or to assume, refinance, amend, recast, add to, or otherwise
modify Seller's existing loan or mortgage secured by the Premises with or from
New York Life nor will it obtain any such loan or submit or sign a proposal, a
term sheet or commitment on or before the Closing Date and for a period of
sixty (60) days after the Closing Date. The provisions of the immediately
preceding sentence shall survive the Closing.
(B) Purchaser shall indemnify Seller and its Representatives
from and against all Losses (as hereinafter defined) in connection with or
arising out of any breach or violation of any of the provisions of subdivision
(A) above, specifically excluding consequential damages.
8.2. (a) Any work performed by Purchaser or its Authorized
Representatives in connection with any inspection of the Premises shall be at
Purchaser's sole cost and expense. Purchaser covenants and agrees to pay in
full all persons who perform labor upon the Premises, and not to permit or
suffer any mechanic's or materialman's lien of any kind or nature to be
asserted or enforced against the Premises for any work done or materials
furnished thereon at the instance or request or on behalf of Purchaser.
(b) Purchaser shall indemnify, defend and hold harmless Seller
and its Representatives (collectively, to "Indemnify") from and against any
and all losses, costs, liabilities, claims, damages or expenses (including,
without limitation, reasonable attorney's fees and costs) [collectively,
"Losses"] arising out of or as a result of any inspection of, or access to,
the Premises and work in connection therewith by Purchaser or its Authorized
Representatives (and any agents, employees, independent contractors and
representatives thereof). Purchaser, at its sole cost and expense, shall
promptly restore the Premises to its condition immediately prior to the
performance of such investigation by Purchaser pursuant to this Section 8 and
shall repair any and all damage caused by Purchaser or its Authorized
Representatives and their employees, representatives, agents or independent
contractors. Purchaser acknowledges and agrees that Seller shall have the
right to use the Escrow Funds to restore the Premises if Purchaser shall fail
to comply with this Section 8.2 within seven (7) business days after notice
from Seller of such damage.
8.3. All indemnities of Purchaser in this Section 8 shall survive
the Closing or any termination of this Agreement.
SECTION 9. Violations Affecting the Premises.
Purchaser shall accept title to the Premises subject to all
violations of law or governmental ordinances, orders or requirements by any
governmental department, agency or bureau having jurisdiction as to conditions
affecting the Premises ("Violations"), and Seller shall have no obligation to
remove or cure any such Violation; provided, however, that to the extent any
Violations remain uncured as of the Closing, Purchaser shall receive a credit
at Closing for the reasonable cost of curing said Violations, not to exceed
under any circumstances the aggregate amount of $[redacted]; provided,
however, that if the cost of curing said violations is reasonably anticipated
to exceed the aggregate amount of $[redacted], Purchaser shall be entitled to
exercise the Termination Option at or prior to the Closing.
SECTION 10. Destruction, Damage or Condemnation Affecting the Premises.
10.1. (a) Seller and Purchaser waive the provisions of all
applicable laws (including General Obligations Law Section 5-1311) relating to
the occurrence of a casualty between the date hereof and the Closing, and
Seller and Purchaser agree that the following provisions with respect thereto
shall govern. Seller agrees to notify Purchaser promptly if the Premises shall
be destroyed or damaged in whole or in part by fire or other casualty prior to
the Closing:
(b) If the Premises or any portion thereof shall be damaged by
fire or other casualty between the date of this Agreement and the Closing and
(I) the cost of restoring and repairing the portion of the Premises so damaged
to substantially its present condition (the "Restoration Cost") is less than
Six Million ($6,000,000) Dollars as reasonably estimated by an architect or
engineer selected by Seller and reasonably satisfactory to Purchaser and (II)
such casualty will not result in tenants occupying an aggregate of more than
50,000 square feet to be entitled to cancel their Leases, then Purchaser shall
have no right to terminate this Agreement and shall purchase the Premises in
its damaged condition and assume full responsibility for repair thereto,
without reduction of the Purchase Price or any other claim or offset. Seller
shall (i) credit to Purchaser against the Purchase Price the amount of any
remaining insurance proceeds theretofore received by Seller in connection with
any such destruction by fire or other casualty (except that all business
interruption insurance theretofore paid and received, if any, and applicable
to periods prior to Closing shall be retained by Seller), less Seller's
reasonable out-of-pocket costs incurred in connection with its attempts to
seek collection of any such insurance proceeds, and (ii) assign to Purchaser
by written assignment in form and substance reasonably satisfactory to Seller
and Purchaser, at the Closing, all of Seller's right, title and interest in
and to any insurance proceeds thereafter payable in connection with any such
destruction by fire or casualty (except that business interruption insurance
thereafter paid and received, if any, shall be apportioned as of the Closing
Date, with that portion of the proceeds of such insurance attributable to the
period prior to the Closing Date to be retained by or paid to Seller);
provided, further, the amount of any credit under clause (ii) above shall not
exceed the excess of the Restoration Cost for all restoration work remaining
to be performed over the amount of insurance proceeds assigned. Purchaser
shall receive credit for any insurance deductible. The Closing shall be
adjourned until the Restoration Cost has been determined, unless Seller has
given Purchaser notice that the Restoration Cost is reasonably expected to
exceed $6,000,000.00 (in which event Purchaser shall proceed as provided in
subparagraph (c) below).
(c) Subject to the provisions of Section 10.1(d), if the
Premises or any portion thereof shall be damaged by fire or other casualty
between the date of this Agreement and the Closing and (I) the Restoration
Cost is more than Six Million ($6,000,000) Dollars as reasonably estimated by
an architect or engineer selected by Seller and reasonably satisfactory to
Purchaser or (II) one or more tenants occupying an aggregate of more than
50,000 square feet shall be entitled to terminate their Leases, then Purchaser
shall have the option, to be exercised within fifteen (15) days from the date
of delivery of a written estimate of the Restoration Cost, to terminate this
Agreement by written notice to the other party (a "Casualty Termination
Notice") [in case of such termination by Purchaser, the same shall constitute
an exercise of Purchaser's Termination Option]. If Purchaser terminates,
neither party hereto shall have any further duties, obligations or liabilities
to the other hereunder, except that Purchaser shall be entitled to the return
of the Escrow Funds, and except for those obligations specifically provided
for in this Agreement to survive the termination of this Agreement. If
Purchaser shall not elect to terminate this Agreement as provided above, then
this Agreement shall remain in full force and effect and the provisions of
Section 10.1(b) shall apply to such damage and restoration and any insurance
proceeds payable in connection therewith.
(d) If a determination of the Restoration Cost by the architect
or engineer required to in Sections 10.1(b) and (c) above shall not have been
delivered to Purchaser within sixty (60) days following the date of casualty,
Purchaser shall be entitled to exercise the Termination Option.
10.2. (a) Seller and Purchaser hereby waive the provisions of
all applicable laws (including General Obligations Law Section 5-1311)
relating to the occurrence of a condemnation between the date hereof and the
Closing, and Seller and Purchaser agree that the following provisions with
respect thereto shall govern. Seller agrees to notify Purchaser promptly if
the Premises shall be taken in whole or in part by right of eminent domain or
condemnation prior to the Closing (a "Taking").
(b) If the Taking will so affect the Premises as to (i) allow
one or more tenants occupying an aggregate of more than 50,000 square feet to
cancel their Leases, (ii) cause the Premises to not comply with applicable
laws, codes and regulations concerning zoning and land use, (iii) prevent the
use of the Premises for its current purposes, or (iv) cause damages in excess
of Six Million ($6,000,000) Dollars as reasonably estimated by an architect or
engineer selected by Seller and reasonably satisfactory to Purchaser, then
Purchaser shall have the right to terminate this Agreement and to exercise its
Termination Option by giving written notice to Seller within fifteen (15) days
of the date Seller sends written notice to Purchaser of the Taking. If
Purchaser does not so terminate this Agreement, or shall have no right to
terminate this Agreement, then (x) this Agreement shall remain in full force
and effect notwithstanding such Taking, (y) Purchaser shall purchase the
Premises in its then condition without reduction of the Purchase Price or any
adjustment or other claim or offset and (z) Seller shall assign to Purchaser
the right to receive any condemnation award payable to Seller as a result of
the Taking, net of (A) any reasonable, actual costs of litigating or
negotiating the amount of, or collecting, the award and (B) any sums expended
by Seller to restore or protect the Premises as a result of the Taking.
10.3. Notwithstanding anything set forth herein to the contrary,
Purchaser shall have no right to terminate this Agreement, receive any credit
against the Purchase Price or other adjustment or receive any insurance
proceeds payable to Seller by reason of any damage or destruction to the
Premises that occurs as a result of any act, omission or negligence of
Purchaser or any of its employees, contractors or agents.
10.4. Seller shall have complete control of all condemnation
proceedings; provided, however, that if Purchaser disagrees with Seller's
conduct thereof, it may give Seller thirty (30) days' notice of the reasons
for such disagreement and exercising as Termination Option within 30-days
thereafter unless Seller agrees with Purchaser's position within said 30-day
period.
SECTION 11. Seller's Closing Obligations.
At the Closing, Seller shall execute and (where the document so
provides) acknowledge and deliver the following items to Purchaser (with
respect to any and all documents requiring execution by Seller, at or prior to
Closing, the signatures of any two (2) "parties of the first part" of Seller
shall be sufficient, but only if the opinion delivered pursuant to Section
11(m) below so provides or Purchaser is otherwise satisfied as to due
execution):
(a) A Bargain and Sale deed (the "Deed"), properly executed and
acknowledged in the form annexed hereto and made a part hereof as Exhibit "O";
(b) A xxxx of sale with respect to the personal property in the form
annexed hereto and made a part hereof as Exhibit "P";
(c) An assignment and assumption agreement with respect to the
Leases in the form annexed hereto and made a part hereof as Exhibit "Q" (the
"Lease Assignment and Assumption");
(d) A general assignment and assumption agreement in the form
annexed hereto and made a part hereof as Exhibit "R" (the "General Assignment
and Assumption");
(e) A schedule, certified to the knowledge of Seller to be true,
correct and complete, setting forth all tenant arrearages and accrued but
unpaid minimum and additional rents, expense escalations, tax and other
adjustments and charges under the Leases attributable to the period prior to
the Closing Date (the "Arrearages and Unpaid Escalations Statement");
(f) The Curtain Wall Agreement and Sidewalk Bridge Agreement, and
[if such parties have so consented and delivered same to Seller,] consents by
the other parties to such agreements to the assignment thereof (but such
consents not being a condition to the Closing), and originals (or copies if
originals are not available) of any other Service Contracts;
(g) Keys to all building entrance doors to, and all equipment and
utility rooms located in, the Premises, which keys shall be properly tagged
for identification;
(h) A schedule, certified to the knowledge of Seller to be true,
correct and complete, of all cash, letters of credit and other items of value
required as security under the Leases at the time of Closing ("Security
Deposits"). All Security Deposits shall be adjusted as provided in Section
13.4(e);
(i) One original letter, in the form of Exhibit "S" annexed hereto
and made a part hereof, executed by Seller, advising tenants at the Premises
that the Premises have been sold to Purchaser and directing that all future
rents and other correspondence should thereafter be sent to Purchaser or as
Purchaser may direct;
(j) A non-foreign status affidavit in the form annexed hereto and
made a part hereof as Exhibit "T";
(k) [section redacted]
(l) A New York City Real Property Transfer Tax Return and New York
State Combined Real Estate Transfer Tax Return and Credit Line Mortgage
Certificate with payment in the form reasonably required by the title company
and/or the recording office;
(m) An opinion of Xxxxxx & Rich, P.C., as to the due execution and
authority of Seller with respect to the documents to be delivered by Seller at
the Closing, in substantially the form set forth in Schedule "2" annexed
hereto and made a part hereof (provided, however, that if there are any
changes other than the insertion or change in date(s) and/or reference(s) to
documents or events, all changes must be satisfactory to Purchaser in
Purchaser's discretion);
(n) Originals (or if originals are not available, copies certified
by Seller, to Seller's knowledge, to be true, correct and complete) of all
Leases;
(o) Any items in the Title Letter and any other customary affidavits
and other items reasonably required by the Title Insurer, which does not
require Seller to assume any additional liability than is provided in this
Agreement;
(p) Copy of notice of termination (conditional upon and effective at
the Closing) and Seller's certificate or other evidence that said notice has
been sent, of the leasing/management agreement with current managing agent and
any other exclusive agency or leasing agreement in existence on the date of
the Closing;
(q) A certificate dated as of the date of the Closing, stating that
to Seller's knowledge the representations and warranties of Seller in the form
and manner made herein, are true and correct in all material respects and with
the same limitations and qualifications, if any, made herein as if made as of
the date of the Closing, provided, however, that Seller may update any
representations or warranties that have changed between the date hereof and
the Closing, provided, however, that in such event, Purchaser may, in its sole
discretion, exercise the Termination Option if any changes have a material and
adverse effect on Purchaser or the Premises;
(r) A Closing Statement;
(s) Notice of termination of the Service Contracts (excluding the
"Excluded Service Contracts", as hereinafter defined) [conditional on and
effective at the Closing] and Seller's certificate or other evidence that the
notices have been sent;
(t) A rent roll certified to the knowledge of Seller to be true,
correct and complete;
(u) If the holder thereof has consented thereto and allowed same to
Seller, assignment of mortgage to Purchaser's designee (not a condition to the
Closing);
(v) Prior to the Closing, Seller shall deliver to the Building
management office, all tenant files, financial statements, building plans,
warranties, guaranties, reports, bills and any other items in Seller's control
or possession or in the Building manager's control or possession and
reasonably required to operate the Premises. Purchaser agrees to cooperate
with Seller and to allow Seller and its representatives to have continued
reasonable access to and the right to makes copies of the foregoing materials
after the Closing. The provisions of the immediately preceding sentence of
this subparagraph (v) shall survive the Closing;
(w) [section redacted]
(x) [section redacted]
(y) All other instruments and documents consistent with this
Agreement which may be reasonably and customarily required to effect the
transaction contemplated herein and within Seller's control, provided that
such instruments or documents may be delivered without additional cost or
liability to Seller (other than de minimis amounts).
SECTION 12. Purchaser's Closing Obligations.
12.1. At the Closing, Purchaser shall execute and (where the
document so provides) acknowledge and deliver the following items to Seller
(or the designated Holdback Escrowee, if specifically so provided herein
below):
(a) The balance of the Purchase Price to be delivered at the Closing
(after application of the Downpayment), including any Additional Purchase
Price, as adjusted for apportionments under Section 13 and Section 14 hereof,
and less the amounts of the Representations and Warranties Holdback and the
[language redacted] which shall be delivered by Purchaser to the Warranties
Holdback Escrowee and the [language redacted] as provided herein;
(b) The Lease Assignment and Assumption;
(c) The General Assignment and Assumption;
(d) A New York City Real Property Transfer Tax Return and New York
State Combined Real Estate Transfer Tax Return and Credit Line Mortgage
Certificate;
(e) The Hearst LOC;
(f) All other instruments and documents consistent with this
Agreement which may be reasonably and customarily required to effect the
transaction contemplated herein and within Purchaser's control, provided that
such instruments or documents may be delivered without additional cost or
liability to Purchaser (other than de minimis amounts);
(g) The Warranties Holdback Funds to Warranties Holdback Escrowee to
be paid to Seller, subject to the terms and conditions set forth in Section
7.6 hereof, on account of the balance of the Purchase Price not later than
nine (9) months after the Closing, except for the Remy Amerique Commission
Funds which subject to the terms and conditions set forth in Section 7.6
hereof shall be paid to Seller not later than December 31, 2000;
(h) [section redacted]; and
(i) [section redacted]
12.2. Notwithstanding anything to the contrary contained herein,
the obligation of Seller to close title in accordance with this Agreement is
expressly conditioned upon the fulfillment by and as of the time of Closing of
each of the conditions listed below, each of which may be waived in whole or
in part by Seller upon notice to Purchaser;
(a) Purchaser shall have executed and delivered to Seller all of the
documents, shall have paid all sums of money and shall have taken or caused to
be taken all of the other action required of Purchaser in this Agreement.
(b) All representations and warranties made by Purchaser in this
Agreement shall be true and correct in all material respects with same
limitations, if any, as contained herein as of the date of the Closing.
12.3. Notwithstanding anything to the contrary contained herein,
the obligation of Purchaser to close title and pay the Purchase Price in
accordance with this Agreement is expressly conditioned upon the fulfillment
by and as of the time of Closing of each of the conditions listed below, each
of which may be waived in whole or in part by Purchaser upon notice to Seller.
(a) Seller shall have executed and delivered to Purchaser all of the
documents, complied with all covenants and shall have taken or caused to be
taken all of the other action required of Seller under this Agreement.
(b) All representations and warranties made by Seller in the form
and manner made in this Agreement shall be true and correct in all material
respects and with the same limitations, if any, as contained herein, as if
made on and as of the Closing Date, provided, however, that for the purposes
of this Section 12, Seller shall not be deemed in breach of any warranty or
representation herein (and Purchaser shall remain obligated to Close) unless
such breach has a material and adverse effect on Purchaser or the Premises.
(c) The Title Insurer shall be willing to insure title to the
Premises pursuant to an ALTA 1992 Owner's Policy of Title Insurance in the
amount of the Purchase Price at regular rates and without additional premium
(which shall be deemed to include the cost of any customary endorsements to
title requested by Purchaser), subject only to the Permitted Exceptions set
forth on Exhibit B.
(d) [section redacted]
(e) [section redacted]
(f) Any letter of credit described on Exhibit F which has expired
shall have been renewed or replaced.
SECTION 13. Apportionments and Adjustments; Closing Costs.
13.1. Except as otherwise specifically provided herein, Purchaser
and Seller shall adjust as of 11:59 p.m. of the day preceding the Closing the
items hereinafter set forth. If any such items are not determinable at the
Closing, the adjustment shall be made subsequent to the Closing when the
amount is determined. Any errors or omissions in computing adjustments at the
Closing shall be promptly corrected. The obligations set forth in this Section
13 shall survive the Closing. Except as otherwise specifically provided for
herein, all adjustments shall be made in the manner recommended by the Customs
in Respect to Title Closings of the Real Estate Board of New York, Inc., and
there shall be no other adjustments. Subject to the further provisions of this
Section 13 and Section 14, the items to be adjusted are:
(a) Subject to Section 13.4, rents (as used in this Agreement
"rents" or "rental" includes all items of additional rent) under Leases
which are (x) collected prior to the Closing and (y) applicable to the
month in which the Closing occurs. At Closing, Seller shall credit
against the Purchase Price the amount of any rents which have been paid
to Seller prior to Closing by tenants which rents are attributable to any
period from and after the date of Closing. Reference is made to Section
13.4 below for treatment of delinquent rents in the month of the Closing
and of post-Closing rental payments and receipts.
(b) Real estate taxes on the basis of the fiscal period for which
assessed. If the Closing shall occur before the tax rate is fixed, the
apportionment of taxes shall be upon the basis of the tax rate for the
next preceding fiscal period applied to the latest assessed valuation.
Promptly after the new tax rate is fixed, the apportionment of real
estate taxes shall be recomputed. If Seller has made an overpayment of
real estate taxes for New York City fiscal year 1998-99 or any earlier
fiscal year and any portion of the overpayment is credited towards
payment of 1999-2000 (or later) real estate taxes for the Land and
Improvements rather than being refunded to Seller, an appropriate
adjustment shall be made at Closing (and thereafter as otherwise provided
herein) in favor of Seller for its right, title and interest in such
credit. Seller shall retain all rights to contest, protest or seek tax
reductions for all periods prior to and including tax year 1998-1999, as
provided in Section 19.14, and Purchaser shall have full control to
contest, protest or seek tax deductions for the tax years after and
including 1999-2000.
(c) Water rates, water meter charges, sewer rents, vault charges and
Business Improvement District Charges, if any, on the basis of the fiscal
period for which assessed. If there is a water meter or meters on the
Premises, the unfixed meter charges and the unfixed sewer rent thereon
shall be apportioned on the basis of the last reading, and shall be
appropriately readjusted after the Closing on the basis of the next
subsequent bills. As to any unpaid water charges or sewer rents payable
by tenants, Purchaser shall close title and accept the delivery of the
deed subject to such unpaid charges and rents and any lien resulting
therefrom, without abatement against the Purchase Price, credit or
allowance of any kind or any claim or right of action against Seller for
damages or otherwise.
(d) Fuel, if any, on the basis of Seller's last cost therefor,
including sales tax, as evidenced by a written statement of Seller's fuel
oil supplier dated within thirty (30) days of the Closing, which
statement shall be conclusive as to quantity and cost.
(e) Charges under all Service Contracts which have not been
terminated pursuant to Section 14.3 hereof.
(f) License and permit fees on assignable licenses and permits.
(g) Maintenance supplies in unopened containers based on Seller's
actual cost therefor, including sales tax.
(h) Administrative fees allowable by law on tenant security deposits
if expressly provided for in the Leases.
(i) New Lease Expenses (as defined and subject to the provisions of
Section 14).
(j) Any other item of cost or expense incurred or payable with
respect to the ownership, use or operation of the Premises, customary in
connection with the sale of a comparable New York City office building,
apportioned on the basis of documentary evidence of payments made or due
for goods, services and obligations therefor, based on documentary basis
of payment or incurring of costs or expenses; provided, however, that in
no event shall all such adjustments exceed the aggregate amount of
$10,000.
(k) Purchaser shall receive a credit of [redacted] in respect of the
cost of completing the ongoing work with respect to the HVAC Building
Management System.
(l) Any other item which, under the terms of this Agreement, is to
be apportioned at the Closing.
13.2. At the Closing, the net adjustment pursuant to this Section
13 shall be paid (i) if in favor of Seller, in the same manner as set forth in
Section 2 of this Agreement or (ii) if in favor of Purchaser, as a credit
against the Purchase Price payable pursuant to Section 2 of this Agreement.
13.3. Purchaser and Seller hereby agree to make, and the Closing
Statement prepared at the Closing shall provide to be made, such adjustments
and prorations as and when discovered after Closing.
13.4. (a) Rental from tenants and other receipts derived from
the operation of the Premises shall belong to Seller to the extent that they
relate, or are attributable, to the period up to but not including the date of
Closing, and shall belong to Purchaser to the extent that they relate, or are
attributable, to the period from and after the date of Closing. Any and all
amounts received by Purchaser following Closing for rents due to Seller prior
to Closing (including an amount equal to Seller's share of rents receivable
for the month in which the Closing occurs)[language redacted].
(b) As to rental payments for fuel pass-alongs, so-called escalation
rent, percentage rent, or charges based upon real estate taxes, operating
expenses, labor costs, "xxxxxx'x wage rate," cost of living increases or
otherwise (such pass-alongs, escalation rent and charges being collectively
called "Overage Rent"), for the applicable accounting period in which the
Closing occurs, if the Closing shall occur prior to the time when any such
Overage Rent is payable, then such Overage Rent shall be apportioned
subsequent to the Closing. Purchaser agrees that it will receive in trust and
pay over to Seller a pro-rated amount of such Overage Rent at the end of the
calendar year in which the Closing occurs. As to any Overage Rent payable
subsequent to the Closing with respect to an accounting period which occurs
prior to the Closing, Purchaser agrees that it will receive and hold such
Overage Rent in trust for Seller and pay the entire amount to Seller within
thirty (30) days of receipt thereof. Seller shall furnish to Purchaser all
information with respect to the accounting period in which the Closing occurs
which is reasonably necessary for the billing of such Overage Rent. If, prior
to the Closing, Seller shall collect any sums on account of Overage Rent or
fixed rent for a year or other period, or any portion of such year or other
period, beginning prior to but ending subsequent to the Closing, such sum
shall be apportioned at the Closing. At the Closing, as part of the Arrearages
and Unpaid Escalations Schedule, the parties shall agree to reconcile
estimates of payments of expense escalations (and other similar additional
rent) under the Leases with actual expense escalations (and other similar
additional rent), when such amounts are actually determined by Purchaser after
the Closing. Purchaser shall provide to Seller an accounting of all such
amounts.
(c) Subsequent to the Closing, Purchaser agrees that it shall
promptly render bills for and shall exercise the same diligence in the
collection of any fixed rent and Overage Rent due to Seller pursuant to this
Agreement as it does in the collection of then current rentals due to
Purchaser. Nothing herein contained shall preclude Seller from asserting
separate and independent claims against such tenants, including, but not
limited to, the institution of such actions or proceedings as Seller shall
deem necessary or advisable for the purpose of collecting such past due fixed
rent and Overage Rent; provided, however, that subsequent to the Closing no
such action or proceeding may affect such tenant's possession and provided
that such claims exceed $25,000.
(d) Except as specifically set forth in this Agreement, Purchaser
acknowledges and agrees that no representation has been made and no
responsibility is assumed by Seller with respect to the continued occupancy of
any portion of the Premises by any tenant and Seller does not guarantee or
undertake to insure that any tenant will be in occupancy at the Closing, and
Purchaser agrees that the abandonment, vacation or removal of any tenant(s)
prior to the Closing shall not be the basis for any claim on the part of
Purchaser or right of action against Seller for damages or otherwise;
provided, however, that nothing herein shall be deemed to limit or impair
Purchaser's right to exercise the Termination Option.
(e) All Security Deposits, together with accrued interest thereon,
if any, and less Seller's proportional share of administrative fees, if any,
expressly set forth in the Leases, shall be turned over by Seller to Purchaser
at the Closing. Amounts held in the form of cash shall be turned over, at
Seller's option, by (i) payment of the amount thereof to Purchaser, or (ii) a
credit to Purchaser against the Purchase Price. Any Security Deposit in a form
other than cash shall be transferred to Purchaser by way of appropriate
instruments of assignment or transfer. If any such non-cash Security Deposits
shall not be transferable at Closing, Seller shall nevertheless turn over such
Security Deposits to the possession of Purchaser at Closing and shall
cooperate with Purchaser's efforts to effect such transfer. Seller hereby
designates Purchaser as Seller's agent to act, from and after the Closing, in
the name of Seller (but for the benefit of Purchaser) with respect to any such
non-cash Security Deposits which remain in the name of Seller after the
Closing. Upon request of Purchaser, Seller shall execute powers-of-attorney in
favor of Purchaser in furtherance of the foregoing. All costs of transferring
non-cash Security Deposits shall be for Seller's account. Purchaser hereby
agrees to Indemnify Seller and its Representatives from all losses from any
wrongful acts or improper drawings or misapplication of proceeds under any
non-cash Security Deposits. Between the date of this Agreement and the
Closing, Seller shall not draw on or apply any Security Deposit without the
prior written consent of Purchaser. Notwithstanding the foregoing or any other
provisions herein to the contrary, except as provided in Section 7.7 (with
respect to the Chase Lease) and Section 13.4(a) (with respect to Suite 1802),
there shall be no transfers, adjustments or apportionments of any kind with
respect to the Chase Lease, Suite 1802 or Suite 2305. The provisions of this
Section 13.4(e) shall survive the Closing.
(f) [section redacted]
(g) [section redacted]
(h) [section redacted]
13.5. Without limiting any of the provisions of this Section 13,
(a) Purchaser shall pay its attorneys' fees and expenses, recording fees and
charges, the cost of the Title Commitment, any and all premiums of any title
insurance and endorsements, the cost to obtain a survey of the Land, and (b)
Seller shall pay its attorneys' fees and expenses, and the New York State
Conveyance Tax in accordance with Article 31 of the New York State Tax Law and
the New York City Real Property Transfer Tax in accordance with Title II of
Chapter 46 of the Administrative Code of the City of New York and all other
transfer, documentary, stamp, deed and similar taxes and recordation taxes and
filing fees in connection with the execution and delivery of the Deed.
13.6. Any calculation made in computing any apportionment made
pursuant to this Section 13 may be reconfirmed following the Closing, and any
errors thereto shall be corrected immediately upon notice from the other party
that such error(s) exist. The provisions of this Section 13 shall survive the
Closing for twelve (12) months.
SECTION 14. Operation of Premises.
14.1. Subject to the further terms of this Section 14, until the
Closing, Seller shall operate the Premises in the ordinary course of business
and shall maintain the Premises in substantially the same manner as it is
currently being maintained (normal wear and tear excepted); provided, however,
that Seller shall not be required to make any capital expenditures with
respect to the Premises. If Seller shall make any capital expenditures which
(a) are required as a result of an emergency (other than casualty) with notice
to and consultation with the Purchaser if reasonable under the circumstances,
or (b) are consented to by Purchaser, Seller shall be entitled to a credit for
the cost thereof at the Closing equivalent to the period of time from and
after the Closing bears to the estimated useful life of the capital
expenditure.
14.2. (a) Prior to the Closing, Seller shall not modify,
extend, renew, cancel or permit the surrender of any Lease or enter into any
new Lease of all or any portion of the Premises without Purchaser's prior
written consent. If the Closing has not occurred within 75 days of the
Scheduled Closing Date, the Seller, in its sole discretion, may extend, renew,
or enter into any new Lease of all or any portion of the Premises, without
Purchaser's consent, provided Seller continues to act in accordance with the
standards and practices currently employed by Seller at the Premises.
(b) If Seller enters into any new Leases pursuant to this Section
14, or if there is any extension or renewal of any Leases after the date
hereof, whether or not such Leases provide for their extension or renewal, or
any expansion or modification of any Leases (each, a "New Lease"), Seller
shall keep accurate records of all reasonable expenses (collectively, "New
Lease Expenses") incurred in connection with each New Lease, including,
without limitation, all expenses, or reimbursements to tenants for the
following: (i) brokerage commissions and fees, (ii) expenses incurred for
repairs and improvements to satisfy the tenant's requirements, (iii) the cost
of removal and/or abatement of asbestos, and (iv) legal fees. Notwithstanding
the foregoing, all such expenses (other than Non-Termination Commissions)
payable in respect of the Remy Amerique Expansion Agreement shall not
constitute "New Lease Expenses", but shall be paid by Seller or, to the extent
not paid on or before the Closing Date, credited against the Purchase Price.
(c) The New Lease Expenses for each New Lease allocable to and
payable by Seller shall be determined by multiplying the amount of such New
Lease Expenses by a fraction, the numerator of which shall be the number of
days contained in that portion, if any, of the term of such New Lease
commencing on the commencement date thereof ("Commencement Date") and expiring
on the date immediately preceding the Closing Date, and the denominator of
which shall be the total number of days contained in the period commencing on
the Commencement Date and expiring on the date of the scheduled expiration of
the term of such New Lease, and the remaining balance of the New Lease
Expenses for each New Lease shall be allocable to and payable by Purchaser.
14.3. To Seller's knowledge, Exhibit "V" annexed hereto and made a
part hereof contains a true and correct list of all service agreements,
maintenance contracts, contracts for the purchase or delivery of labor,
services, utilities, materials, goods, inventory or supplies, cleaning
contracts, equipment rental agreements or leases ("Service Contracts")
affecting the Premises. Seller shall not at any time following the date
hereof, without Purchaser's prior written consent, enter into any new Service
Contract (or renew or extend any existing Service Contracts) which shall not
be cancelable immediately without cost. Within 5 business days after the
execution and delivery of this Agreement, Seller shall give notice of
termination (or cause such notice to be given) for all the Service Contracts
(except as set forth below), each such termination to be conditional on the
Closing and effective on the later of (a) the Closing Date and (b) the
earliest date permitted under the respective Service Contract, and, if the
Closing Date shall occur before the earliest date permitted for the
termination of any Service Contract, Purchaser shall assume and remain
obligated thereunder for the period from the Closing to the date of
termination of such Service Contract pursuant to Exhibit "R". Notwithstanding
the foregoing, Purchaser acknowledges and agrees that the Service Contracts
with Xerox and AFA Fire Protection (collectively, "Excluded Service
Contracts") shall not be terminated by Seller, but shall be assigned by Seller
and assumed by Purchaser, pursuant to Exhibit "R" as aforesaid. The provisions
of this Section 14.3 shall survive the Closing.
14.4. [section redacted]
14.5. [section redacted]
SECTION 15. Broker.
15.1. Each of Seller and Purchaser represents and warrants to the
other that it has dealt with no broker, finder or other person who is
entitled, by reason of dealing with the indemnifying party, to any fee,
commission or other similar compensation in connection with the transaction
contemplated by this Agreement other than Xxxxxxx & Xxxxxxxxx, Inc. (the
"Broker") Seller represents and warrants that it shall be solely responsible
for the payment of any and all fees, commissions or other compensation due to
the Broker in connection with this transaction pursuant to a separate
agreement previously entered into between Seller and Broker.
15.2. Purchaser shall indemnify, defend and hold harmless Seller,
its agents, employees and representatives from and against any and all losses,
costs, liabilities, claims, damages or expenses (including, without
limitation, reasonable attorneys' fees and costs) arising out of the breach of
Purchaser's representations or warranties contained in this Section 15.
15.3. Seller shall indemnify, defend and hold harmless Purchaser,
its agents, employees and representatives from and against any and all losses,
costs, liabilities, claims, damages or expenses (including, without
limitation, reasonable attorneys' fees and costs) arising out of the breach of
Seller's representations or warranties contained in this Section 15.
15.4. The representations, warranties and indemnities contained in
this Section 15 shall survive the Closing or, if the Closing does not occur,
the termination of this Agreement, for a period of nine (9) months.
SECTION 16. Notices.
16.1. All notices under this Agreement shall be in writing, shall
refer to this Agreement and shall be (a) delivered personally, (b) sent by
registered or certified mail, postage prepaid, return receipt requested, or
(c) sent by a nationally recognized overnight courier. Notices shall be deemed
given on the first business day on or after receipt or refusal thereof. Except
as otherwise expressly provided in this Agreement, all notices shall be given
in accordance with the above as follows:
[language redacted]
with a copy to:
Xxxxxx, Xxxx & Xxxxxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxx, Esq.
Telephone No.: 000-000-0000
Fax No.: 000-000-0000
If to Purchaser:
c/o Reckson Associates Realty Corp.
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxxx III
Xxxxx Xxxxxxx, Esq.
Telephone No.: 000-000-0000
Fax No.: 000-000-0000
with a copy to:
Fried, Xxxxx Xxxxxx Xxxxxxx & Xxxxxxxx
Xxx Xxx Xxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxxx Xxxxxxxxxxx, Esq.
Telephone No.: 000-000-0000
Fax No.: 000-000-0000
16.2. Any counsel designated above or any replacement counsel
which may be designated by Purchaser and/or Seller by written notice to the
other party is hereby authorized to give notices hereunder on behalf of its
respective client.
SECTION 17. Limitation on Survival of Representations, Warranties and
Obligations.
17.1. Except as expressly set forth herein to the contrary, no
representations, warranties or obligations of Seller or Purchaser set forth in
this Agreement shall survive the Closing or earlier termination of this
Agreement.
17.2. The delivery of the Deed by Seller and the acceptance
thereof by Purchaser and the delivery by Purchaser of the consideration
required of Purchaser to Seller hereunder shall be deemed the full performance
and discharge of every obligation on the part of such party to be performed
hereunder, except those obligations of Seller and Purchaser, respectively,
which are expressly stated in this Agreement to survive the Closing.
SECTION 18. Prohibition of Recording.
Neither Seller nor Purchaser shall record, or arrange to record, this
Agreement or any memorandum thereof with any filing office in any
jurisdiction.
SECTION 19. Miscellaneous.
19.1. Purchaser shall not sell, assign, convey or otherwise
transfer all or any portion of its rights or interest under this Agreement
without the prior written consent of Seller, which consent may be arbitrarily
withheld by Seller for any reason or no reason, provided, however, that
Purchaser shall be permitted to assign its rights under this Agreement without
the consent of Seller only at and conditioned upon the Closing to an Affiliate
of the Purchaser. Affiliate shall mean an entity which is owned, directly or
indirectly, at least 51% by the Purchaser. If said assignee does not have a
net worth of at least $500 million dollars then Purchaser shall deliver to
Seller at the Closing an unconditional, primary guarantee from Purchaser or an
Affiliate of Purchaser which has a net worth of at least $500 million dollars,
in form satisfactory to Seller ("Guarantor"), with respect to all post-closing
obligations of said assignee. At the Closing, Purchaser shall provide a
current balance sheet or other evidence reasonably satisfactory to Seller,
certified in writing by Purchaser, which establishes that assignee's or
Guarantor's net worth, as the case may be, is at least $500 million dollars.
19.2. This Agreement shall be governed solely by, and construed
solely in accordance with, the internal laws of the State of New York.
19.3. The captions contained in this Agreement were inserted for
convenience of reference only and shall in no way define, describe or limit
the scope or intent of this Agreement or any of the provisions hereof.
19.4. This Agreement shall be binding upon, and shall inure to the
benefit of, the successors and permitted assigns of the parties hereto.
19.5. Time shall be of the essence as to each party's performance
of all of its obligations under this Agreement; provided, however, that
neither party shall be deemed in breach of its obligations hereunder (other
than those contained in Section 2 or those required to be performed at the
Closing) if such party shall fully perform its obligations within two (2)
business days of the date otherwise specified for performance.
19.6. Nothing contained in this Agreement is intended to confer
upon any person, other than the parties hereto and their respective successors
and permitted assigns, any rights, remedies, obligations or liabilities under,
or by reason of, this Agreement.
19.7. This Agreement is a contract for the sale of the Premises
only and is not intended to be, and should not be construed as, an agreement
of lease for the Premises, an installment sales contract, or a contract for
deed.
19.8. This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original but all of which together shall
constitute one and the same instrument, with the same effect as if each party
had executed all counterparts.
19.9. The parties agree that prior to the Closing Date no party
nor any Affiliate shall, with respect to this Agreement and the transactions
contemplated hereby, contact or conduct negotiations with public officials,
make any public pronouncements, issue press releases or otherwise furnish
information regarding this Agreement or the transactions contemplated hereby
to any third party (other than Broker, attorneys, accountants, prospective
title insurers or any lending institution having a lien or intending to have a
lien on the Premises or as required by law), without the consent of the other
party, which consent shall not be unreasonably withheld, delayed or
conditioned it being agreed that the parties may respond to inquiries from the
press so long as they do not disclose any economic or other material terms of
this Agreement which have not been previously disclosed as permitted
hereunder.
19.10. Purchaser agrees that, notwithstanding any contrary
provisions of this Agreement, Purchaser shall look only to the Seller's estate
and interest in the Premises and the holdback provided for in Section 7.6 (to
the extent not released to Seller pursuant to Section 7.6(g) hereof) for the
collection of a judgment (or other judicial process) requiring the payment of
money by Seller, and no other property or assets of the Seller or any direct
or indirect partner, joint venturer, member, officer, or representative or any
affiliate thereof, disclosed or undisclosed (collectively, "Seller's
Principal"), shall be subject to levy, execution or other enforcement
procedure for the satisfaction of any judgment against Seller. Purchaser shall
not name any Seller's Principal as a defendant in any legal action relating to
this Agreement. Without limiting the foregoing, Purchaser shall not look to or
make any claim whatsoever against any proceeds of the Purchase Price (other
than any holdbacks or escrows provided for in this Agreement), any prorations
or adjustments which are required to be made in favor of or paid to Seller by
Purchaser after the Closing, or any other monies released or distributed to or
in the possession of the Seller or any Seller's Principal (including monies
released from holdbacks or escrows). The provisions of this Section 19.10
shall survive the Closing.
19.11. Submission of drafts of this Agreement for examination or
execution by Purchaser shall not bind Seller in any manner or be construed as
an offer to sell, and no contract or obligation of Seller shall arise until
this instrument is executed and delivered by both Seller and Purchaser and the
Downpayment has been received by the Escrowee.
19.12. Any sums due after the Closing by either party hereto to the
other, if not paid within thirty (30) days after the obligation to pay arises,
shall bear interest at the lesser of (a) 2% over the Chase prime rate in
effect from time to time in New York City per annum or (b) the maximum rate
permitted by law from the time such obligation arises until payment. The
provisions of this Section 19.12 shall survive the Closing.
19.13. The parties hereto agree that no part of the Purchase Price
shall be deemed to have been paid by Purchaser for any Personal Property
transferred hereunder. Sales or use taxes, if any, payable by reason of the
sale of any of the Personal Property shall be the sole responsibility of and
shall be paid by Purchaser, and Purchaser shall Indemnify Seller and its
Representatives with respect thereto. The indemnity set forth in the preceding
sentence shall survive Closing.
19.14. Seller shall in Seller's discretion commence or continue any
proceeding for the reduction of the assessed valuation of the Premises for tax
years prior to, but not including, the New York City fiscal year 1999-2000.
Purchaser shall in Purchaser's discretion commence or continue any proceeding
for the reduction of the assessed valuation of the Premises for New York City
fiscal year 1999-2000 and all subsequent tax years, provided, however, that
the net refund or credit of taxes, if any, for the 1999-2000 tax year shall be
divided between Seller and Purchaser in accordance with the proportion which
the period covered by such refund or credit in which the Premises was owned by
Seller bears to the entire period covered, after deducting therefrom a pro
rata share of all expenses, including counsel fees, incurred in obtaining such
refund or credit (the allocation of such expenses to be based upon the total
refund or credit obtained in the proceeding and in any other proceeding
simultaneously involved in the trial or settlement). Purchaser shall deliver
to Seller, upon demand, receipted tax bills and canceled checks used in
payment of such taxes and shall execute any and all consents or other
documents, and do any act or thing necessary for the collection of such refund
or credit by Seller. With respect to real estate tax refunds or credits with
respect to the Premises relating to fiscal years prior to the Closing which
may be required to be reimbursed to tenants at the Premises Purchaser and
Seller shall enter into an escrow arrangement in the form attached hereto as
Exhibit "Z" and made a part hereof, on or prior to the Closing Date, for the
deposit of such refunds into escrow pending the payment of such reimbursement
to the tenants, and returning all excess funds to Seller for all years prior
to 1999-2000, and for an equitable apportionment of the excess funds between
Seller and Purchaser for the year 1999-2000. The provisions of this Section
19.4 shall survive the Closing.
19.15. This Agreement cannot be modified, changed or discharged
except by an agreement in writing, signed by the party or parties against whom
enforcement of such modification, change or discharge is sought (and, in the
case of Seller, which Seller intends to have executed by any two (2) of the
"parties of the first part" of Seller, on behalf of Seller, who have authority
to execute such documents).
19.16. If Seller intends to make a Unit Election (as defined
below), and provided that Seller and Purchaser are able to agree on the terms
(including, but not limited to, the valuation of units) of the Unit Election
as hereinafter set forth, then immediately prior to the Closing, Seller may
transfer the Premises to a special purpose limited liability company ("SPE")
and may distribute its membership interests in the SPE to the present joint
venture members of Seller, subject to the rights and obligations provided for
under this Agreement. In such a case, (a) this Agreement shall automatically
become an agreement by Purchaser to purchase, and an agreement by the SPE
members to sell or exchange, all of the SPE membership interests for
consideration equal to the Purchase Price consisting of cash and Units, as
described and based upon the terms and conditions set forth herein and (b)
Seller shall indemnify and hold Purchaser harmless (which indemnity shall
survive the Closing) from and against any and all liabilities or obligation of
the SPE which accrue prior to the Closing. Upon written notice (the "Unit
Election Notice") given to Purchaser not less than 10 days prior to the
Closing, not more than 20 of the members of Seller shall have the option to
take a portion, but in no event less than $10,000,000.00 in the aggregate, of
the Purchase Price in the form of common units of Reckson Operating
Partnership, L.P. ("Units"); provided, that each of Seller's members that
makes the election to receive a portion of the Purchase Price in the form of
Units (the "Unit Election") shall agree to those representations, warranties
and restrictions as set forth on Schedule "4" annexed hereto and any other
terms which Purchaser shall reasonably require. The Unit Election Notice shall
describe the amount of cash and the Units to be received by each such member
in exchange for its membership interest in the SPE. If Purchaser and Seller
agree to the terms provided for in the Unit Election, any amendments to this
Agreement as may be necessary to permit the Unit Election and to permit the
members of Seller to receive such Units shall be made without any increase in
the respective obligations or liabilities or any decrease in the respective
rights of the parties (except as may be required hereunder to permits the
Units to be used as consideration for the sale). Such amendments may include,
without limitation, at Seller's option, Seller's appointment of an
administrator or custodian to receive and disburse, on behalf of all SPE
members, the balance of the Purchase Price and all prorations, adjustments and
refunds which are payable after the Closing. If Purchaser and Seller do not,
on or before the Closing Date, agree, in each party's sole discretion, to the
terms provided for in the Unit Election, then the Unit Election shall be
deemed null and void, Seller shall not transfer the Premises to the SPE and
Seller and Purchaser shall proceed with the sale of the Premises in accordance
with this Agreement as if the Unit Election Notice had never been given. It is
expressly acknowledged and agreed that if, for any reason or no reason, the
Unit Election does not occur, or if the Unit Election has occurred but if for
any reason any SPE member who was to receive Units in accordance with the Unit
Election does not accept the Units, this Agreement shall remain in full force
and effect and the parties' obligations to each other shall not be affected
thereby. In such latter case, the portion of the Purchase Price allocated to
the Units that are not accepted shall be paid in cash at the Closing. The
parties intend that any exchange of SPE membership interests for Units qualify
as a tax-free exchange under Section 721 of the Internal Revenue Code. In no
event shall any transfer of the Premises by Seller to an SPE or any resulting
transfer of this Agreement, operate to release Seller from any and all
obligations or liabilities under this Agreement.
19.17. Other than that certain confidentiality letter, dated as of
August 24, 1999, from Purchaser to Seller and to Xxxxxxx & Xxxxxxxxx, Inc.
(the "Confidentiality Agreement") [but excluding paragraph 5 of the
Confidentiality Agreement, which paragraph 5 is superseded by this Agreement],
this Agreement contains the entire agreement of the parties [language redacted].
19.18. [section redacted]
19.19. [section redacted]
[language redacted]
PURCHASER: RECKSON OPERATING PARTNERSHIP, L.P.
Federal Employer Identification By: Reckson Associates Realty Corp.
Number # ______________________
By: /s/ Xxxxx Xxxxxxx
--------------------------------
Name: Xxxxx Xxxxxxx
Title: Executive Vice President
THE UNDERSIGNED JOINS IN THE EXECUTION HEREOF SOLELY FOR THE PURPOSE OF
AGREEING TO ACT AS "ESCROWEE" PURSUANT TO THE PROVISIONS OF THIS AGREEMENT
RELATING TO THE ESCROW OF THE ESCROW FUNDS.
XXXXXX, XXXX & XXXXXXXX LLP
By: /s/ Xxxxxxx X. Xxxx
------------------------------
Name: Xxxxxxx X. Xxxx, Partner
THE UNDERSIGNED JOINS IN THE EXECUTION HEREOF SOLELY FOR THE PURPOSE OF
AGREEING TO ACT AS "WARRANTIES HOLDBACK ESCROWEE" AND "CHASE HOLDBACK
ESCROWEE", RESPECTIVELY, PURSUANT TO THE TERMS OF THIS AGREEMENT RELATING TO
THE ESCROW OF THE WARRANTIES HOLDBACK FUNDS AND THE CHASE HOLDBACK FUNDS.
FRIED XXXXX XXXXXX XXXXXXX & XXXXXXXX
By: /s/ Xxxx Xxxxxxxxxx
------------------------------
Name: Xxxx Xxxxxxxxxx
