HOTEL PURCHASE AGREEMENT
Exhibit
10.1
THIS
HOTEL PURCHASE AGREEMENT (this “Agreement”)
is
made as of September _____ 2005 (the “Effective
Date”),
by
and between WO
GRAND HOTEL, LLC,
a New
Jersey limited liability company, having an address c/o Wilshire Enterprises,
Inc, Xxx Xxxxxxx Xxxxxx, 00xx
Xxxxx,
Xxxxxx, Xxx Xxxxxx 00000 (“Seller”),
and
000
XXXXXXXX XXXXXX
HOTEL ASSOCIATES, L.L.C.,
a New
Jersey limited liability company with an address at 000 X.X. Xxxxx 00, Xxxxx
00,
Xxxx, Xxx Xxxxxx 00000 (“Buyer”).
AGREEMENT:
SELLER
AND BUYER HEREBY AGREE AS FOLLOWS:
Section
1. Definitions.
Seller and Buyer hereby agree that the terms defined in Annex A shall have
the
definitions therein set forth.
Section
2. Agreement
of Sale and Purchase. Seller agrees to sell and convey to Buyer, and Buyer
agrees to purchase from Seller, upon the terms and conditions set forth in
this
Agreement, all of Seller’s right, title and interest in and to the following
(collectively, the “Property”): (a) the Real Property, (b) the Personal
Property, (c) the Leases, (d) the Service Contracts (to the extent freely
assignable to Buyer), (e) the Permits (to the extent freely assignable to
Buyer), and (f) the Guest Ledger.
Section
3. Property
Information
3.1 Seller
shall deliver, or cause to be delivered, to Buyer (without representation
or
warranty, except as may otherwise be expressly provided in this Agreement)
the
following (the “Property
Information”),
to
the extent in the possession of Seller, not later than thirty (30) day after
the
Effective Date (provided that if Seller shall not timely deliver such items,
then Buyer shall give notice to Seller thereof, and Seller shall deliver
such
items within thirty (30) days after receipt of such notice from Buyer, to
the
extent in the possession of Seller):
(a) Copies
of
all Occupancy Agreements and all commission, brokerage or similar agreements
pertaining to the Occupancy Agreements, if any;
(b) Copies
of
the lease files for all tenants of the Property (but not including the tenant
under the Operating Lease), including without limitation, each Lease (other
than
the Operating Lease) and all correspondence pertaining to each Lease (other
than
the Operating Lease) and all consents or waivers with respect thereto
(“Lease
Files”);
(c)
A
schedule of all Advance Deposits held but not applied by Seller, if
any;
(d) Copies
of
the engineering and technical reports (including structural, plumbing,
electrical or mechanical studies), environmental reports and site assessments
related to the Property in the possession of Seller, which are described
on
Schedule
E
(the
“Property
Reports”);
(e) As-built
plans with respect to the Improvements in the possession of Seller, if
any;
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(f) Copies
of
all Permits issued by any governmental authority with respect to the Property,
if any;
(g) Copies
of
Seller’s most current title insurance information and survey, if
any;
(h) Copy
of
the Restaurant Lease;
(i) Copies
of
Service Contracts.
3.2 During
the thirty (30) day period prior to the Closing Date, Buyer, its agents and
consultants shall have reasonable access to the general manager at the Hotel
at
reasonable times at reasonable intervals provided that (i) such access shall
not
interfere with or disrupt the performance by such general manager of his
duties
nor take up more than a de minimus portion of the working hours of such general
manager and (ii) if and at such times as Seller shall require, a representative
of Seller is present. Seller shall make a representative available at reasonable
times at reasonable intervals if provided reasonable prior notice.
3.3 Buyer
shall have the right, at reasonable times, at reasonable intervals, to conduct
reasonable, non-invasive, non-intrusive inspections of the Property, subject
to
the provisions of this Section
3.3
and
Section
3.4.
Buyer
(a) shall, for the purposes of this Section
3.3
and
Section
3.4,
give
Seller not less than one (1) Business Day’s notice of Buyer’s intention to enter
the Property and at all times conduct Buyer’s inspections in compliance with
applicable law and the terms of the Leases, in a manner so as not to cause
damage, loss, cost or expense to Seller, the Property or the tenants, occupants
or guests, and without unreasonable interference with or disturbance of their
use and enjoyment of the Property, (b) shall promptly restore the Property
to
its condition immediately preceding Buyer’s inspection and examination, (c)
shall keep the Property free and clear of any mechanic’s liens or materialman’s
liens caused by Buyer’s activities, (d) shall not contact the Tenants and shall
not contact any governmental authority having jurisdiction over the Property
without Seller’s express written consent other than in connection with searches
of the public record in the ordinary course of Buyer’s preparation for closing,
and (e) shall, until the Closing, keep all Property Information and all drafts
or final reports or returns of Buyer’s inspections confidential in accordance
with this Agreement. Seller may elect to have a representative present for
Buyer’s physical inspection of the Property. Prior to coming upon the Property
for any review or inspection in connection with this Agreement, Buyer shall
furnish to Seller property damage and liability insurance policies in form
and
amounts reasonably acceptable to Seller; and Buyer shall restore promptly,
at
Buyer’s sole cost and expense, the Property to substantially the same condition
as existed prior to any such inspection. Buyer and Xxxxx
Xxxxx (personally) and Xxxxxx Xxxxxxx (personally) (collectively, the “Buyer’s
Principals”),
jointly
and severally, shall protect, defend (with counsel reasonably acceptable
to
Seller), indemnify, and hold harmless Seller and the other Seller Parties
from
and against any and all liabilities, actions, suits, mechanics’ liens,
judgments, losses, costs, damages, expenses (including, without limitation,
reasonable attorneys’ fees and expenses), claims and demands of any nature
whatsoever suffered or incurred by or made against Seller and/or such other
Seller Parties, arising out of or in any way relating to the acts or omissions
of Buyer or any of the Buyer Parties in conducting any inspection of the
Property or any other activities by or on behalf of Buyer. The provisions
of
this Section
3.3
shall
survive the Closing or the termination of this Agreement.
3.4 Anything
in this Agreement to the contrary notwithstanding, including without limitation
the provisions of Section
3.3,
Buyer
shall not, and shall not permit any of the Buyer Parties to, in connection
with
Buyer’s inspection pursuant to Section
3.3,
conduct
any soil tests or sampling or any boring, digging, drilling or other physical
intrusion, physical invasion, or destructive or intrusive inspection or testing
of the Property and/or any of the Improvements (collectively, “Testing”)
without the prior written consent of Seller, in Seller’s sole discretion. If
Seller consents thereto, Buyer shall furnish to Seller such additional property
damage and liability insurance policies in form and amounts reasonably
acceptable to Seller prior to commencing any such Testing and shall, upon
completion thereof, restore promptly, at Buyer’s sole cost and expense, the
Property to substantially the same condition as existed prior to such Testing.
Buyer and Buyer’s Principals, jointly and severally, hereby agree to protect,
defend (with counsel reasonably acceptable to Seller), indemnify and hold
harmless Seller and the other Seller Parties from and against any and all
liabilities, actions, suits, mechanics’ liens, judgments, losses, costs,
damages, expenses (including, without limitation, reasonable attorneys’ fees and
expenses), claims and demands of any nature whatsoever suffered or incurred
by
or made against Seller and/or such other Seller Parties, arising out of or
in
any way relating to the acts or omissions of Buyer or any of the other Buyer
Parties in conducting the Testing or any other activities by or on behalf
of
Buyer. The provisions of this Section
3.4
shall
survive the Closing or the termination of this Agreement.
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3.5 Anything
in Section
3.1
or
otherwise in this Agreement to the contrary notwithstanding, except for copies
of Seller’s most current title insurance information and survey, if any, Seller
shall not be obligated to deliver to Buyer (or to provide Buyer access to)
any
proprietary or confidential documents, files or instruments relating to the
acquisition of the Property by Seller.
Section
4. The
Fund;
the Purchase Price.
4.1 The
Fund;
Contract Deposit.
(a) The
sum
of ONE
MILLION AND 00/100
Dollars
($1,000,000.00), representing the Fund, shall be paid and deposited by Buyer
to
the Fund Account simultaneously with Buyer’s execution of this Agreement and
Buyer’s receipt of this Agreement executed by Seller, and the execution and
delivery of the Operating Lease by the parties thereto, by wire transfer
of
immediately available federal funds to the account designated by Seller as
the
Fund Account. Any interest earned on the principal portion of the Fund shall
be
deemed to be part of the Fund and shall be paid together with the principal
portion of the Fund; except that, it is understood and agreed that if the
Closing occurs any interest earned on the Fund shall be credited to Buyer
and
shall be applied against the Purchase Price.
(b) Seller
shall disburse and apply the Fund as provided in the Operating
Lease.
(c)
The
amount of the Fund, as same may from time to time be reduced as the Fund
is
disbursed and applied pursuant to the Operating Lease, is sometimes referred
to
in this Agreement as the “Initial
Contract Deposit”.
(d) If
Buyer
shall duly exercise Buyer’s option to adjourn the Scheduled Closing Date as
provided in Section
9.1
(and as
a condition to exercising Buyer’s option to adjourn the Scheduled Closing Date
as provided in Section
9.1),
Buyer
shall pay the Closing Adjournment Payment. The Closing Adjournment Payment
is
sometimes referred in this Agreement as the “Additional
Contract Deposit;”
and
the Initial Contract Deposit and the Additional Contract Deposit are hereinafter
referred to collectively as the “Contract
Deposit.”
(e) Except
as
otherwise specifically provided in this Agreement, the Fund shall be utilized
and applied as set forth in the Operating Lease.
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(f) Seller
or
Seller’s Manager shall hold the Fund in a separate account of Seller or Seller’s
Manager at an institution selected by Seller or Seller’s Manager (which
institution shall be subject to Buyer’s approval, not to be unreasonably
withheld, delayed or conditioned) (the “Fund
Account”);
and
the Fund shall not be commingled with other accounts of Seller or Seller’s
Manager or any other moneys of Seller or Seller’s Manager, but nothing herein
shall require Seller or Seller’s Manager to hold the Fund as an escrow fund or
escrow account, a trust fund or trust account, or similar special fund or
account. Seller shall advise Buyer of the location of the institution in
which
the Fund is deposited and the identifying number of the account. The Fund
Account shall be an interest bearing checking account, but Seller (and Seller’s
Manager”) shall have absolutely no liability for the rate of interest or amount
of interest (if any) paid on the Fund by such institution. Seller shall have
no
liability for any losses to Fund except to the extent directly resulting
from
the negligence or willful wrongful act of Seller; and Seller’s Manager shall
have no liability for any losses to Fund except to the extent directly resulting
from the negligence or willful wrongful act of Seller’s Manager (and this
provision shall survive the Closing and/or the termination of this
Agreement).
(g) Anything
in this Agreement to the contrary notwithstanding, if (for any reason whatsoever
or for no reason) the Closing shall not occur, then the Fund Improvements
ipso
facto
automatically shall be and become the property solely of Seller (without
payment
of any consideration to Buyer), and Seller shall have the right to keep and
retain the Fund Improvements as the property solely of Seller (and upon request
by Seller from time to time, Buyer, without charge to Seller, shall execute,
acknowledge and deliver to Seller all reasonable documents requested by Seller
to confirm this); and this agreement by Buyer shall survive the termination
of
this Agreement.
(h) If
(i)
the Closing occurs or (ii) this Agreement is terminated because of an Event
of
Default or otherwise, Seller shall disburse the Contract Deposit to Seller
or
Buyer, as the case may be, in accordance with the provisions pertaining to
the
consequences of the Closing or such termination, as the case may
be.
(i) If,
pursuant to the express provisions of this Agreement, Buyer shall be entitled
to
the refund of the Contract Deposit, then Buyer shall be entitled to the refund
of (i) One Million Dollars ($1,000,000.00), representing the Initial Contract
Deposit (notwithstanding that all or a portion of the Fund has been expended
as
provided in the Operating Lease), plus the interest thereon, if any, plus
(ii)
(only if Buyer has paid the Closing Adjournment Payment), Two Hundred Thousand
Dollars ($200,000.00) representing the Additional Contract Deposit, plus
the
interest thereon, if any; provided,
however,
that
(A) the foregoing provisions of this subparagraph notwithstanding, such right
of
Buyer to such refund shall be subject to the prior full payment, satisfaction
and performance of any and all indemnity and/or other obligations of Buyer
to
Seller and (B) all Fund Improvements ipso
facto
shall
belong solely to Seller and shall be the property solely of Seller.
4.2 Purchase
Price.
(a) The
purchase price for the Property shall be TWELVE
MILLION SEVEN HUNDRED FIFTY THOUSAND DOLLARS
($12,750,000.00) (the “Purchase
Price”);
provided, however, that if the Closing shall be adjourned by Buyer pursuant
to
this Agreement to any date after March 2, 2006 (it being understood that
in no
event shall Buyer have the right to adjourn the Closing beyond March 28,
2006),
then the Purchase Price shall increase by One Thousand Dollars ($1,000) for
each
day (including, without limitation, the actual date of Closing) after March
2,
2006 that Buyer shall have adjourned the Closing.
(b) Buyer
shall pay the Purchase Price to Seller on the Closing Date as follows: On
the
Closing Date, (i) the remaining, unexpended portion of the Fund, if any (the
“Unexpended
Fund Balance”)
shall
be retained by Seller and credited against the Purchase Price, (ii) if the
Additional Contract Deposit shall have been deposited by Buyer with Seller
pursuant to this Agreement, the Additional Contract Deposit shall be retained
by
Seller and credited against the Purchase Price, and (iii) the balance of
the
Purchase Price (the “Purchase
Price Balance”)
shall
be paid by Buyer to Seller by (at the option of Seller) certified or bank
check
or wire transfer of immediately available federals funds to an account
designated by Buyer to Seller prior to the Closing Date.
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4.3 The
parties have agreed to allocate (i) twenty percent (20%) of the Purchase
Price
to the FF&E, and (ii) the balance of the Purchase Price to the Real
Property. Allocations made pursuant to this Section shall be used by Buyer
and
Seller for all tax and other government reporting purposes (and this provision
shall survive the Closing).
Section
5. Operating
Lease/Xxxxxxx Rights.
5.1 Operating
Lease.
(a) Simultaneously
with the execution and delivery of this Agreement, Pleasant Valley 350 Catering
Associates, L.L.C., as tenant, and Seller, as landlord, shall execute and
deliver the Operating Lease.
(b) Any
default by the tenant under the Operating Lease beyond any applicable notice
and/or cure period (if any) specified in the Operating Lease, or the occurrence
of any of the events described in Section 9.01 of the Operating Lease,
ipso
facto shall
be
a default by Buyer under this Agreement entitling Seller, at Seller’s sole
option, to exercise any and/or all of Seller’s rights and remedies under this
Agreement.
(c) Anything
in this Agreement or the Operating Lease to the contrary notwithstanding,
if for
any reason this Agreement shall terminate, then the Operating Lease shall
simultaneously terminate and Buyer shall cause the tenant under the Operating
Lease, not later than two (2) Business Days thereafter, to vacate the premises
and surrender same to Seller as landlord under the Operating Lease, on the
same
terms and conditions as if such date were the date set forth in the Operating
Lease for the expiration thereof, and Buyer’s Principals, jointly and severally,
shall cause the tenant under the Operating Lease to perform its obligations
under this paragraph (and this provision shall survive the termination of
this
Agreement).
5.2 Xxxxxxx
Rights.
Notwithstanding anything to the contrary in this Agreement and/or the Operating
Lease, Buyer acknowledges and agrees that, as a precondition to Seller incurring
or having any obligations under this Agreement, Seller has required that
Buyer,
at Buyer’s sole cost and expense, obtain from Xxxxxxx a release and waiver (the
“Xxxxxxx Release”), in form and substance acceptable to Seller in its sole
discretion, of any and all claims (if any), rights (if any), options (if
any),
rights to manage (if any), rights to develop or construct (if any) call options
(if any), rights of first refusal (if any) and other rights and options (if
any)
owned or held by Xxxxxxx or any person or entity acting in concert with
Xxxxxxx,, relating to the Property or existing pursuant to the Xxxxxxx Rights
Agreement, including, without limitation the “Xxxxxxx Call Option” and the
“Right of Second Refusal” pursuant to, and as defined in, the Xxxxxxx Rights
Agreement.
Section
6. Permitted
Exceptions; Title.
6.1 Permitted
Exceptions.
(a) The
Property is sold and shall be conveyed subject to the following (collectively,
the “Permitted
Exceptions”)
(and
this provision and the Permitted Exceptions shall survive the Closing whether
or
not the Permitted Exceptions are noted as exceptions to title in the
Deed):
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(i)
All
presently existing and future liens for unpaid real estate taxes and assessments
not due and payable as of the Closing Date, subject to adjustment as hereinafter
provided;
(ii)
All
present and future Legal Requirements including, without limitation, any
laws
relating to zoning, building, environmental protection and the use and occupancy
of the Property; the non-compliance of the Property with any of the foregoing;
all violations of any Legal Requirements noted or issued before, on or after
the
Effective Date, whether or not of record; all conditions which would give
rise
to or constitute a violation of any Legal Requirements, whether or not noted
by
any Governmental Authority; and all fines and penalties relating to or which
arise or have arisen in connection with any such violation;
(iii)
The
Leases and the rights of tenants of the Property pursuant to Leases, and
all
liens and title encumbrances the payment of which is the obligation of a
tenant
under a Lease, and all actions and/or suits involving the Leases and/or the
rights or obligations of the tenants pursuant to the Leases;
(iv)
The
Service Contracts, all financial and other obligations under the Service
Contracts, and all security and other instruments (whether or not of record)
relating to or arising in connection with the Service Contracts (except,
in
respect of the Air Conditioning Agreement, as otherwise hereinafter provided),
and all actions and/or suits involving the Service Contracts and/or the rights
or obligations of the contractors pursuant to the Service
Contracts;
(v)
Taxes
and
water and sewer charges which are a lien but not yet due and payable, subject
to
adjustment at Closing;
(vi)
The
state
of facts shown on the certain survey dated March 5, 1998, Survey No. 98-8282,
prepared by Xxxxxxx X. Xxxxxx, Inc., and any state of facts or physical
condition which a current accurate survey or physical inspection of the Property
would disclose, provide such state of facts shall not both (1) render title
unmarketable and (2) have a material, adverse effect on (a) access to the
Property, (b) improvements, if any, made to the Property in connection with
the
use of the Property for a hotel, restaurant, and/or catering facility, or
(c)
the use of Property for a hotel, restaurant, and/or catering
facility;
(vii)
Variations,
if any, between (i) tax lot lines and the record lines, (ii) fences and record
lines and (iii) the legal description of the Land set forth on Schedule B
annexed to this Agreement and the tax map description thereof;
(viii)
Possible
encroachments and/or projections of stoop areas, roof cornices, window trims,
vent pipes, cellar doors, steps, columns and column bases, flue pipes, signs,
piers, lintels, window xxxxx, fire escapes, satellite dishes, protective
netting, sidewalk sheds, ledges, fences, coping walls (including retaining
walls
and yard walls), air conditioners and the like, if any, on, under or above
any
street or highway, the Property or any adjoining property;
(ix)
The
covenants, easements, restrictions, reservations and other matters set forth
on
Schedule D annexed hereto;
(x)
All
other
or additional easements, covenants, restrictions, reservations and other
matters, whether or not of record, the existence of which shall not have
a
material, adverse effect on (1) access to the Property, (2) improvements,
if
any, made to the Property in connection with the use of the Property for
a
hotel, restaurant, and/or catering facility, or (3) the use of Property for
a
hotel, restaurant, and/or catering facility;
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(xi)
Any
encumbrances upon or defects to title caused by any act or negligence of
Buyer
or any other Buyer Party, and any encumbrances upon or defects to title caused
by the tenant under the Operating Lease); and
(xii)
Any
other
matter that would constitute a Title Objection with respect to which the
Title
Company agrees that it will insure title to the Real Property free of such
Title
Objection, or with affirmative insurance against the enforcement, or collection
of such Objection against the Real Property either (i) at regular rates and
without the payment of additional premiums, or (ii) with any additional rate
or
payment paid by Seller (at Seller’s sole option, it being expressly understood
that Seller shall have no obligation to pay any premium for any title insurance,
including without limitation any additional rate or additional premium to
cause
the Title Company to provide affirmative insurance, or to omit any title
objection, or to insure against collection out of the Real
Property);
(xiii) Rights
of
the municipal, county and/or state government and/or any subdivision thereof
and/or any public or private utility or cable television company to install,
replace, construct, maintain, repair and operate lines, wires, cables, conduits,
pipes, poles, distribution boxes and other equipment, fixtures or facilities
in,
on, over, through or under the Real Property;
(xiv) Rights
of
the public and adjoining owners in highways, streets, roads and lanes bounding
or abutting the Real Property; and retaining walls or other walls, bushes,
trees, xxxxxx, fences and the like, extending from or onto the Real Property,
and any portion of the Premises lying in the bed of any street;
(xv) Consents,
or lack of consents, by any present or former owner of the Real Property
or any
part thereof for the erection or maintenance of any structure or structures
on,
under or over any abutting street or streets;
(xvi) The
existence of any streams, rivers, ponds or other waters on, under or across
the
Land, any areas which are could be designated as wetlands on, under or across
the Land, rights of third parties in or to any such streams and other waters,
and Legal Requirements imposed or arising out of or in connection with any
such
waters and areas;
(xvii) The
existence of a stream traversing the Land to which “fresh water wetlands” and/or
“transition area” designation and legal requirements may apply; and
(xviii) The
actions, proceedings and matters set forth in Schedule H, and all matters
relating thereto (subject, however, to the indemnification obligations of
Seller
set forth in Section 7.1(a)(iv));
(xix) The
Property Reports and all information set forth therein; and
(xx) Any
judgments of record or unpaid franchise taxes of any person or corporation
which
may have had an interest in the Real Property, provided that the Title Company
is willing to insure Buyer against collection of such sums without payment
of
any additional sums therefore by Buyer.
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(b) The
Permitted Exceptions shall not constitute grounds for objection by Buyer,
and
Seller shall have no obligation to remove any Permitted Exception as a condition
to Buyer's obligation to purchase the Property in accordance with this
Agreement.
6.2 Title.
(a) Buyer
shall promptly order from the Title Company a title examination of the Real
Property (the “Title
Report”)
and
shall cause a copy of the Title Report to be delivered to Seller’s attorney
within two (2) Business Days following the delivery of same to Buyer. Buyer
may,
at its sole cost and expense, obtain a survey or an updated survey of the
Real
Property, and shall cause of copy thereof to be delivered to Seller’s attorney
simultaneously with the delivery of same to Buyer. No later than 5:00 PM
Eastern
Standard Time on the twentieth (20th) day following the Effective Date (the
“Title
Report Objection Date”),
Buyer
shall furnish to Seller’s attorney a copy of the Title Report, a copy of any
survey or updated survey of the Real Property obtained by Seller, and notice
(the “Title
Report Objection Notice”)
specifying any exceptions to title to the Property set forth in the Title
Report
and survey (if Buyer has elected to obtain same) (“Title
Objections”),
provided, however, that time
shall be of the essence
as
against Buyer to furnish such materials to Seller as of the thirtieth
(30th)
day
following the Effective Date. Buyer’s failure to deliver the Title Report
Objection Notice to Seller on or prior to 5:00 PM Eastern Standard Time on
the
Title Report Objection Date shall constitute Buyer’s irrevocable acceptance of
the Title Report and survey (if any) and Buyer shall be deemed to have
unconditionally waived any right to object to any matters set forth therein
(and, if Buyer has not obtained a survey or updated survey, Buyer shall be
deemed irrevocably to have accepted any state of facts a new accurate survey
of
the Property would reveal). If, after giving the Title Report Objection Notice
to Seller or after the Title Report Objection Date, if no Title Objection
Notice
is given, Buyer learns, through continuation reports or other written evidence,
of any title defect which are not Permitted Exceptions, Buyer shall give
written
notice thereof to Seller’s attorney promptly after the date Buyer learns of
same.
(b) (i)
Except as expressly provided to the contrary herein, Seller shall have no
obligation either to bring or continue any action or proceeding, or to incur
any
expense, obligation or liability (contingent or otherwise), or to take any
action, to remedy any Title Objection(s), or otherwise to remove any defect
in
or objection to title or to fulfill any condition precedent to Buyer’s
obligations under this Agreement.
(ii)
If,
on
the Closing Date, Seller is unable to convey to Buyer title to the Property
subject to and in accordance with the provisions of this Agreement and free
and
clear of all liens, encumbrances and defects (including without limitation
the
Title Objections), other than Permitted Exceptions, Seller shall be entitled,
upon written notice delivered to Buyer on or prior to the Closing Date, to
reasonable adjournments of the Closing one or more times for a period not
to
exceed sixty (60) days in the aggregate to enable Seller to attempt to convey
such title to the Property (it being understood that notwithstanding any
such
adjournments, Seller shall have no obligation either to bring or continue
any
action or proceeding, or to incur any expense, obligation or liability
(contingent or otherwise), or to take any action, to remedy any Title
Objection(s) or otherwise to remove any defect in or objection to title or
to
fulfill any condition precedent to Buyer’s obligations under this Agreement). If
Seller does not so elect to adjourn the Closing, or if at the adjourned date
Seller is unable to convey title subject to and in accordance with the
provisions of this Agreement and free and clear of all liens, encumbrances
and
defects (including, without limitation, the Title Objections), other than
Permitted Exceptions, Buyer, as its sole options, shall be entitled to either:
(A) terminate this Agreement by written notice to Seller delivered on the
Closing Date, in which event the Contract Deposit shall be promptly refunded
to
Buyer and this Agreement shall thereupon be deemed terminated and become
void
and of no further effect, and neither party hereto shall have any obligations
of
any nature to the other hereunder or by reason hereof, except for those
provisions that expressly survive such termination; or (B) complete the purchase
(with no reduction in or abatement of the Purchase Price and no liability
on the
part of Seller in connection with such Title Objection(s), title defects
or
encumbrances) with such title as Seller is able to convey on the date, as
applicable, that is either ten (10) days after the Closing Date if Seller
does
not elect to adjourn the Closing or ten (10) days after the adjourned date
of
the Closing if Seller does elect to adjourn the Closing. If Seller elects
to
adjourn the Closing as provided above, this Agreement shall remain in effect
for
the period or periods of adjournment, in accordance with its terms.
8
(iii)
If
at any
xxxx Xxxxxx shall give notice to Buyer that Seller elects not to attempt
to
remedy or to continue to attempt to remedy a Title Objection (“Seller’s Title
Objection Election Notice”), Buyer’s sole remedies shall be to (A) terminate
this Agreement by terminate this Agreement by written notice to Seller not
later
than five (5) Business Days after the giving of Seller’s Title Objection
Election Notice, in which event the Contract Deposit shall be promptly refunded
to Buyer and this Agreement shall thereupon be deemed terminated and become
void
and of no further effect, and neither party hereto shall have any obligations
of
any nature to the other hereunder or by reason hereof, except for those
provisions that expressly survive such termination; or (B) complete the purchase
(with no reduction in or abatement of the Purchase Price and no liability
on the
part of Seller in connection with such Title Objection(s), title defects
or
encumbrances) with such title as Seller is able to convey on the date, as
applicable, that is either ten (10) days after the Closing Date if Seller
does
not elect to adjourn the Closing or ten (10) days after the adjourned date
of
the Closing if Seller does elect to adjourn the Closing; and upon the failure
by
Buyer to give such notice to Seller in a timely manner, Buyer conclusively
shall
be deemed to have elected the option set forth in the preceding clause (B).
(iv)
Seller
shall, on or prior to the Closing Date, pay, discharge or remove of record
or
cause to be paid, discharged or removed of record, at Seller’s sole cost and
expense, the following: (I) mortgages on the Real Property granted by Seller
or
taken subject to or assumed by Seller; and (II) the following matters (the
matters described in this clause (II), collectively, “Required Payment Liens”,
but, anything herein to the contrary notwithstanding, Required Payment Liens
shall not include any Permitted Exceptions): any judgments, mechanics’ liens,
federal, state and municipal tax liens and other liens for financial obligations
(not including (A) liens or other financial obligations which are Permitted
Exceptions, (B) liens or other financial obligations in respect of or relating
to the Service Contracts (other than the Air Conditioning Agreement, which
Seller shall pay and discharge as provided in this Agreement), (C) liens
and
other obligations to be apportioned as provided in this Agreement, and/or
(D)
liens or other financial obligations which are the obligation of a tenant
under
a Lease (including, without limitation, the Operating Lease) and provided,
however, that anything herein to the contrary notwithstanding Seller shall
be
required to pay, discharge or remove Required Payment Liens only to the extent
that the aggregate cost of the Required Payment Liens (including without
limitation the preparation or filing of appropriate satisfaction instruments
in
connection therewith) does not exceed One Million Dollars ($1,000,000.00)
(the
“Required Payment Lien Cap”); and (III) all other liens and other encumbrances
(other than Permitted Exceptions) on or against the Property which arise
from or
out of any intentional, voluntary act of Seller from and after the Effective
Date. To the extent that the cost of discharging or removing the Required
Payment Liens exceeds the Required Payment Lien Cap, then unless Seller (in
Seller’s sole discretion) gives notice to Buyer electing to discharge and remove
the Required Payment Liens notwithstanding that the cost of discharging or
removing same exceeds the Required Payment Lien Cap, Buyer, as Buyer’s sole
options, may elect to (A) terminate this Agreement by written notice to Seller
delivered on the Closing Date, as may be adjourned pursuant to this Agreement,
or, if sooner, not later than five (5) Business Days after Seller gives notice
that Seller does not elect to discharge and remove the Required Payment Liens
to
the extent that the cost of discharging or removing same exceeds the Required
Payment Lien Cap, in which event Seller shall return the Contract Deposit
to
Buyer and this Agreement shall thereupon be deemed terminated and become
void
and of no further effect, and neither party hereto shall have any obligations
of
any nature to the other hereunder or by reason hereof, except for those
provisions that expressly survive such termination; or (B) complete the purchase
(with no reduction in or abatement of the Purchase Price and no liability
on the
part of Seller in connection therewith) with such title as Seller is able
to
convey, provided that Seller expends up to the Required Payment Lien Cap
or
grants to Buyer a credit in lieu thereof against the Purchase
Price.
9
(c) The
acceptance of the Deed by Buyer shall be deemed to be full performance of,
and
discharge of, every agreement and obligation on Seller’s part to be performed
under this Agreement, except for such matters which are expressly stated
to
survive the Closing.
(d) Notwithstanding
anything in this Agreement to the contrary, if the Property shall, at the
time
of the Closing, be subject to any Required Payment Liens, the same shall
not be
deemed an objection to title provided that, at the time of the Closing, Seller
delivers certified or official bank checks at the Closing in the amount required
to satisfy the same and delivers to the Title Company at the Closing instruments
in recordable form sufficient to satisfy and discharge of record such liens
and
encumbrances together with the cost of recording or filing such instruments,
or
the Title Company otherwise agrees to “omit” such Required Payment Liens as an
exception to Buyer’s title insurance policy or to provide affirmative insurance
against the enforcement or collection of such Required Payment Liens against
or
out of the Real Property.
(e) If
a
search of title discloses judgments, bankruptcies or other returns against
other
persons or entities having names the same as or similar to that of Seller,
Seller will deliver to the Title Company an affidavit stating that such
judgments, bankruptcies or other returns are not against Seller, whereupon,
provided the Title Company omits such returns as exceptions to title or provides
affirmative coverage with respect thereto, such returns shall not be deemed
an
objection to title.
(f) Notwithstanding
anything herein to the contrary, at Closing, Seller may (i) use any portion
of
the Purchase Price to remove or discharge any Title Objection(s) or (ii)
deposit
with the Title Company monies (which may include a portion of the Purchase
Price) and/or documents or instruments sufficient to effect the issuance
of
title insurance in favor of Buyer free of any Objections, or with affirmative
insurance against the enforcement or collection of any Title Objection against
or out of the Real Property, and Buyer shall accept title to the Real Property
with such insurance and/or affirmative coverage. If written request is made
by
Seller or Seller's attorneys within a reasonable time prior to the Closing
Date,
Buyer shall deliver separate certified or bank checks, or wire funds to separate
accounts, aggregating the amount of the Purchase Price, to facilitate the
removal and discharge of any Title Objections and the discharge of Seller's
other monetary obligations under this Agreement. Any Title Objection removed
or
discharged in a manner acceptable to the Title Company shall be deemed resolved
to the satisfaction of Buyer.
(g) Notwithstanding
anything in this Agreement to the contrary (including, without limitation,
the
provisions of Section
6.2(b)(iv),
Buyer
agrees that if Seller, after using commercially reasonable efforts (which
shall
not include an obligation to pay money), shall fail to have released or
discharged of record any UCC financing statements encumbering the Property
in
favor of The Trust Company of New Jersey (or any successor to or assign of
The
Trust Company of New Jersey) (the “Specified
UCC’s),
then
(1) if (x) Buyer shall not procure title insurance at the Closing or (y)
if
Buyer shall procure title insurance at the Closing,
if the
Title Company shall be willing to omit the Specified UCC’s from Buyer’s title
insurance policy at the Closing or to provide affirmative insurance that
such
UCC financing statements will not be collected out of the Property (it being
understood that Seller shall have the right, but not the obligation, to pay
any
additional premium charged by the Title Company for providing such affirmative
insurance), such UCC financing statements shall not be deemed an objection
to or
defect to title, and Buyer shall close title subject thereto with no abatement
of the Purchase Price and no liability on the part of Seller in connection
therewith, or (2) (if Buyer shall procure title insurance at the Closing)
if the
Title Company shall take an exception for the Specified UCC’s from Buyer’s title
insurance policy at the Closing, then Buyer, as its sole remedy, shall have
the
right either to (x) complete the purchase (with no reduction in or abatement
of
the Purchase Price and no liability on the part of Seller in connection with
Specified UCC’s, or (y) terminate this Agreement by written notice to Seller
delivered on the Closing Date, in which event the Contract Deposit shall
be
promptly refunded to Buyer and this Agreement shall thereupon be deemed
terminated and become void and of no further effect, and neither party hereto
shall have any obligations of any nature to the other hereunder or by reason
hereof, except for those provisions that expressly survive such termination.
The
Specified UCC’s shall not be deemed to include any financing statements, UCC’s
and other notices concerning any equipment financing agreements and/or equipment
financing leases which are to be assumed by or assigned to Buyer pursuant
to
this Agreement.
10
Section
7. Representations
and Warranties of Parties.
7.1 Seller’s
Representations and Warranties.
(a)
Seller hereby represents and warrants to Buyer as follows:
(i) Seller’s
Existence. Seller is a limited liability company, duly organized, validly
existing and in good standing under the laws of the State of New Jersey.
Seller
has full limited liability company power and authority and has obtained all
necessary limited liability company consents to own and sell the Property
and to
enter into and comply with the terms of this Agreement.
(ii)
Authority.
The execution and delivery of this Agreement by Seller and the consummation
by
Seller of the transaction contemplated by this Agreement is within Seller’s
capacity and all requisite action has been taken to make this Agreement valid
and binding on Seller in accordance with its terms.
(iii)
No
Legal
Bar. Subject to obtainment of the Xxxxxxx Release, the execution by Seller
of
this Agreement and the consummation by Seller of the transaction hereby
contemplated does not and on the Closing Date will not (a) result in a material
breach of or default under any indenture, agreement, instrument or obligation
to
which Seller is a party and which affects all or any portion of the Property
or
by which Seller is bound (not including, however, any of the Service Contracts
which prohibit assignment or which prohibit assignment without the consent
of
the other party to the Service Contract), or (b) to Seller’s actual knowledge,
constitute a violation in a material respect of any Legal Requirement (it
being
understood that this representation and warranty shall not be deemed to include
any matter concerning any liquor license or the transferability thereof or
the
aforesaid Service Contracts).
(iv) Litigation.
(A) Except as set forth on Schedule H, there are no actions, suits, proceedings
or investigations (including condemnation proceedings) to Seller’s actual
knowledge pending or to Seller’s actual knowledge threatened, against Seller
and/or the Property or that pertain directly to Property, its use, maintenance
and/or operations as of the Effective Date that are not adequately insured
against and that, if determined adversely to Seller, would materially impair
the
Property, its use, maintenance and/or operations.
11
(B) It
is
understood that the foregoing representation and warranty by Seller in Section
7.1(a)(iv)(A) shall not be deemed to include any representation or warranty
(1)
concerning any actions, suits, proceedings or investigations by any Governmental
Authority which relates in any way to or shall relate in any way to the failure
or omission of the Property and/or any operations thereat or use thereof
to
comply with any Legal Requirement or to have obtained and/or maintained any
Permit or Certificate, including, without limitation, any liquor license,
or (2)
any action, suit or proceeding brought by, involving, or arising out of any
act
or omission of, Buyer, or any affiliate of Buyer, or any Buyer’s
Principal.
(C) It
is
understood that if there is any breach by Seller of the foregoing representation
and warranty in Section 7.1(a)(iv)(A) in respect of any Lease and/or Service
Contract, then, anything to the contrary in this Agreement notwithstanding,
Buyer shall be obligated to close title in accordance with the terms and
provisions of this Agreement, with no reduction in or abatement of the Purchase
Price and no liability on the part of Seller in connection therewith, except
that (x) Seller shall be responsible for and shall indemnify, defend (with
counsel reasonably acceptable to Buyer) and hold Buyer harmless from and
against
any damages which may be payable in connection with any suit, action or
proceeding which relates to any default by the Seller, as landlord under
such
Lease or contracting party to such Service Contract which first occurred
during
the period of Seller’s ownership of the Property (except to the extent such
default is attributable to any act or wrongful omission of Buyer, or any
affiliate of Buyer, or any Buyer’s Principal, or is the responsibility of the
tenant under the Operating Lease, or any default is precipitated or occasioned
by the transfer of the Property to Buyer or the assignment of any Lease or
Service Contract to Buyer) and (y) Seller shall bear the reasonable cost
of
curing any such breach by Seller, as landlord under such Lease or contracting
party to such Service Contract which first occurred during the period of
Seller’s ownership of the Property (except to the extent such default is
attributable to any act or wrongful omission of Buyer, or any affiliate of
Buyer, or any Buyer’s Principal, or is the responsibility of the tenant under
the Operating Lease, or any default is precipitated or occasioned by the
transfer of the Property to Buyer or the assignment of any Lease or Service
Contract to Buyer); and this provision shall survive the Closing.
(D) Anything
in this Agreement to the contrary notwithstanding, Buyer agrees that Buyer
shall
be responsible for and shall indemnify, defend (with counsel reasonably
acceptable to Seller) and hold Seller harmless from any damages which may
be
payable in connection with any suit, action or proceeding which relates to
(i)
any default by the landlord under any Lease, to the extent such default occurred
from and after the Closing (except to the extent that such default is
attributable to any act or wrongful omission of Seller after the
Closing),
(ii)
any default by the owner of the Property under any Service Contract, to the
extent such default occurred and accrued from and after the Closing (except
to
the extent that such default is attributable to any act or wrongful omission
of
Seller after the Closing), and (iii) any injury to person or damage to property,
to the extent such default occurred and accrued from and after the Closing;
and
this provision shall survive the Closing.
(E) Anything
in this Agreement to the contrary notwithstanding, including without limitation
the foregoing provisions of Section 7.1(a)(iv)(C), if Buyer shall incur any
obligation to pay any damages in connection with any of the matters described
in
Paragraphs 4,5, 6, 7, and 8 on Schedule
H,
then
Seller shall be responsible for and shall indemnify, defend (with counsel
reasonably acceptable to Buyer) and hold Buyer harmless from and against
any
such damages; provided, however, that the aggregate liability of Seller pursuant
to this paragraph (including, without limitation, attorneys’ fees and other
costs of defense) shall not exceed $75,000.00 in the aggregate; and this
provision shall survive the Closing.
12
(vi)
Leases.
The Restaurant Lease and the Operating Lease are the only occupancy (as opposed
to financing) Leases affecting the Property as of the Effective Date. Seller
makes no representation or warranty as respect any of the Leases except that
Seller represents and warrants to Buyer that (i) to the knowledge of Seller
as
of the Effective Date, the copy of the Restaurant Lease provided by Seller
to
Buyer is true and complete; and (ii) as of the Effective Date, there are
no
outstanding notices claiming default by Seller, as landlord, or by the tenant
under the Restaurant Lease, as tenant, claiming a default which has not been
cured as of the Effective Date. Except
as
hereinafter provided, Buyer shall be required to assume as of the Closing
only
(i) the Restaurant Lease, (ii) the Operating Lease (if same has not been
terminated or expired), and (iii) all additional Leases entered into by Seller
pursuant to Section 8.2.
(vii)
Intentionally
omitted.
(viii)
Occupancy
Agreements. Set forth on Schedule F annexed hereto is a true, correct and
complete list of Occupancy Agreements in existence as of the Effective
Date.
(ix)
Notices.
Seller is not aware of, and has not received, any notices from any Governmental
Authorities (A) of pending or threatened condemnation proceedings with respect
to the Property, or (B) of any proceedings which could or would cause the
change
of the zoning classification of the Property. Seller shall immediately notify
Buyer of any its receipt of any written notice of any of the foregoing.
(x)
Patriot
Act. (i)
Neither
Seller nor its investors is a Prohibited Person (as defined below), has
conducted any business or has engaged in any transaction or dealing with
any
Prohibited Person or has engaged in any transaction relating to any property
or
interests in property blocked pursuant to the Executive Order (as defined
below), has engaged in any transaction that evades or avoids any of the
requirements or prohibitions set forth in the Patriot Act, 50 U.S.C. Sec.
1701
et seq.
(ii) Seller
investors are in compliance with all applicable orders, rules and regulations
issued by, and recommendations of, the U.S. Department of the Treasury and
OFAC
(as defined below) pursuant to IEEPA (as defined below) and the PATRIOT Act;
and
(iii) None
of
Seller’s investors is a “Prohibited Foreign Shell Bank” (as defined in the
PATRIOT Act), or is named on any available lists of known or suspected
terrorists, terrorist organizations or of other sanctioned persons issued
by the
United States government and/or the government(s) of any jurisdiction(s)
in
which Seller is doing business; “Prohibited Person” means any Person: (a) listed
in the Annex to, or is otherwise subject to the provisions of, the Executive
Order No. 13224 on Terrorist Financing, effective September 24, 2001, and
relating to Blocking Property and Prohibiting Transactions With Persons Who
Commit, Threaten to Commit, or Support Terrorism (the “Executive Order”); (b)
that is owned or controlled by, or acting for or on behalf of, any person
or
entity that is listed in the Annex to, or is otherwise subject to the provisions
of the Executive Order; (c) that commits, threatens or conspires to commit
or
supports “terrorism” as defined in the Executive Order; (d) that is named as a
“specifically designated national (SDN)” on the most current list published by
the U.S. Treasury Department Office of Foreign Assets Control at its official
website, xxxx://xxx.xxxxx.xxx.xxxx/x00xxx.xxx or at any replacement website
or
other replacement official publication of such list or is named on any other
U.S. or foreign government or regulatory list issued post-09/11/01; (e) that
is
covered by IEEPA, OFAC or any other law, regulation or executive order relating
to the imposition of economic sanctions against any country, region or
individual pursuant to United States law or United Nations resolution; or
(f)
that is an affiliate (including any principal, officer, immediate family
member
or close associate) of a person or entity described in one or more of clauses
(a) - (e) of this definition of Prohibited Person. “IEEPA” means the
International Emergency Economic Power Act, 50 U.S.C. §1701 et seq.
“OFAC”
means the U.S. Department of Treasury’s Office of Foreign Asset
Control.
13
(b) All
representations and warranties made by Seller in this Agreement are made
as of
the date of this Agreement and (except as otherwise provided in this Agreement)
shall be true and correct in all material respects as of the Closing Date
(it
being understood that as of the Closing Date Seller shall deliver to Buyer
(1)
an updated Schedule of Occupancy Agreements, (2) an updated schedule of Leases
reflecting terminations and expirations of Leases, modifications of Leases,
and
new Leases and/or renewals entered into by Seller in accordance with this
Agreement, (3) an updated schedule of Service Contracts reflecting terminations
and expirations of Service Contracts, modifications to Service Contracts,
and
new Service Contracts and/or renewals entered into by Seller in accordance
with
this Agreement, and (4) an updated schedule (to Seller’s knowledge) of suits,
claims, investigations and proceedings; and any variations between the
information shown on such updated schedules and the information shown in
this
Agreement (i) shall not be deemed a breach of a representation or warranty
by
Seller or an inaccuracy in any representation or warranty by Seller, (ii)
shall
not give rise to any liability on the part of Seller, and (iii) shall not
give
rise to any right to Buyer to terminate this Agreement, or to receive a refund
of the Contract Deposit, or to any other right or remedy on the part of Buyer,
provided
any such
variations or changes are permitted in accordance with the provisions of
this
Agreement). If, on the Closing Date, any such representations and warranties
are
not true or accurate in all material respects, then (subject to the
parenthetical statement in the immediately preceding sentence) Buyer, as
its
sole remedies, shall have the remedies set forth in Section
14.2(b)
of this
Agreement.
Seller’s
representations and warranties set forth in this Agreement (as same shall
be
subject to amendment or update as provided in this Agreement) shall survive
the
Closing for a period of twelve (12) months, and any claim to be asserted
by
Buyer in connection with any of Seller’s representations and warranties must be
asserted not later than the date twelve (12) months after the Closing, failing
which such claim shall be deemed irrevocably waived.
7.2 Buyer’s
Representations and Warranties.
Buyer
hereby represents and warrants to Seller as follows:
(a) Buyer’s
Existence.
Buyer
is a limited liability company duly organized, validly existing
and in good standing under the laws of New Jersey. Buyer has all necessary
limited liability company power and authority to buy
the
Property and to comply with the terms of this Agreement, and
has
obtained all necessary limited liability company consents to purchase the
Property and to enter into and comply with the terms of this
Agreement.
(b) Financial
Resources.
Buyer
has available or has arranged to have available all necessary funds and
financings (if any) required for Buyer to pay the Purchase Price and otherwise
perform its obligations under this Agreement in a timely manner. Nothing
in this
provision or otherwise in this Agreement shall condition Buyer’s obligations on
the obtainment of any such funds and/or financing.
14
(c) Authority.
The
execution and delivery of this Agreement by Buyer and the consummation by
Buyer
of the transaction contemplated by this Agreement are within the Buyer’s
capacity and all requisite action has been taken to make this Agreement valid
and binding on Buyer in accordance with its terms.
(d) No
Legal Bar.
The
execution by Buyer of this Agreement and the consummation by Buyer of the
transaction hereby contemplated does not and on the Closing Date will not
to
Buyer’s actual knowledge (i) result in a material breach of or default under any
indenture,
agreement, instrument or obligation to which Buyer is a party, or (ii) to
Buyer’s actual
knowledge, constitute a violation in a material respect of any Legal
Requirement.
(e) Patriot
Act.
(a)
Buyer is
not a Prohibited Person, has not conducted any business or in any transaction
or
dealing with any Prohibited Person, has not engaged in any transaction relating
to any property or interests in property blocked pursuant to the Executive
Order;
(ii) Buyer
is
in compliance with all applicable orders, rules and regulations issued by,
and
recommendations of, the U.S. Department of the Treasury and OFAC pursuant
to
IEEPA and the PATRIOT Act.
(f) Buyer
Review of Property Information and Inspection of the Property.
Buyer
has inspected the Property and fully reviewed the Property Information
(including, without limitation, the Property Reports) provided by Seller
to
Buyer (which reports, Buyer acknowledges, have been provided without
representation or warranty by Seller), and Buyer is fully familiar with all
defects and alleged defects affecting the Property, including, without
limitation, (i) environmental matters, and (ii) structural matters, construction
matters, maintenance matters, and compliance with law matters, including
without
limitation (A) existence of third elevator shaft at the Property which is
in
non-working condition (the elevator cab and/or operating equipment may not
be
installed, or, if installed, is not working) (this issue may not be noted
in the
Property Reports), (B) lack of permanent certificates of occupancy for the
Property, and possible lack of (or revocable nature of) temporary certificates
of occupancy for the Property (this issue may not be noted in the Property
Reports), and possible lack of other required permits, certificates,
registrations or licenses concerning the Property, (C) the fact that site
work
pursuant to municipal site plan and other work for municipal approvals is
not
complete, including without limitation: top course of pavement and striping
in
rear parking area behind hotel and catering areas, and other required paving
and
striping; fence along northerly property line; removal of dirt and construction
debris in lower parking lot; construction of additional lower parking area;
renovation of detached building in rear parking area; installation of dumpster
pads and fencing for hotel and restaurant (this issue may not be noted in
the
Property Reports), (D) possible requirement by Governmental Authorities and/or
Legal Requirements for installation of fencing across the Land) (this issue
may
not be noted in the Property Reports), (E) possible requirement for completion
of paving and/or installation of additional paving for parking areas (this
issue
may not be noted in the Property Reports); (F) existence of an underground
storage tank on the Land (this issue may not be noted in the Property Reports);
and (G) that certain equipment, fixtures or personal property described in
certain Service Contracts, including without limitation the kitchen equipment
Lease (financing agreement) between Team, WOHA and Mase, as described on
Schedule C, may be lost or missing, including without limitation the
oven/microwave, slicer and food warmer.
(g)
No
Reliance.
As of
the Effective Date Buyer has performed all due diligence and inspections
necessary for Buyer to independently verify all information important to
Buyer’s
determination of whether to proceed with the Closing, and Buyer is not relying
and shall not be relying upon any statements, covenants, agreements,
representations or warranties from Seller or any other party in proceeding
with
the Closing, other than the statements, covenants, agreements representations
and warranties that are expressly set forth in this Agreement.
15
(h)
Related
Entity.
The
Buyer and the tenant under the Operating Lease are related and affiliated
entities, having common ownership, and will be so until the Closing has
occurred, and (i) Buyer has approved the Operating Lease, and the terms and
provisions thereof, and (ii) the tenant under the Operating Lease, and all
guarantors of the Operating Lease, have approved this Agreement, and the
terms
and provisions thereof. Nothing herein shall limit the right of Buyer and/or
the
tenant under the Operating Lease to transfer any ownership interests in the
Buyer and/or the tenant under the Operating Lease after the
Closing.
Buyer’s
representations and warranties shall survive the Closing for a period of
twelve
(12) months, and any claim to be asserted by Seller in connection with any
of
Buyer’s representations and warranties must be asserted not later than the date
twelve (12) months after the Closing, failing which such claim shall be deemed
irrevocably waived.
7.3 Closing
with Knowledge of Misrepresentation.
Anything in this Agreement to the contrary notwithstanding, if, at the Closing,
a party to this Agreement has knowledge or notice that any of the
representations or warranties of the other party to this Agreement are not
true,
and notwithstanding such notice or knowledge such party closes title under
this
Agreement, then such party conclusively shall be deemed to have waived any
and
all claims, rights and/or remedies (if any) if might otherwise have had by
reason of the untruth of such representations and/or warranties of the other
party (and this waiver shall survive the Closing).
Section
8. Seller’s
Covenants and Affirmative Obligations.
8.1 Maintenance
and Operation of the Property.
Until
the Closing or earlier termination of this Agreement, and subject to the
provisions of this Agreement and the provisions of the Operating Lease, Seller
shall maintain and operate the Property in substantially the same condition
and
manner as the Property is now maintained and operated by the Seller, provided,
however, that Seller shall have no obligation to perform any maintenance
or to
perform any operations that are the obligation of any tenant under any Lease,.
Seller shall also maintain its books and records in the usual regular and
ordinary manner. Except as otherwise provided for herein, all Personal Property
shall be delivered and transferred to Buyer (in its “as is, where is” condition
as of the Closing) at no additional cost to Buyer. No material items of tangible
Personal Property owned or leased by Seller shall be removed from the Hotel
prior to the Closing (except as may otherwise be permitted or performed under
the Operating Lease), except in the ordinary course of business or except
for
items for which replacements or substitutions of approximately equal utility
and
value are provided to the Hotel. Seller shall deliver to Buyer upon Buyer’s
request, approximately fifteen (15) days prior to the scheduled Closing Date,
such then-current information with respect to Guest Bookings, Occupancy
Agreements and other bookings, as the Seller customarily keeps or receives
internally for its own use. Anything in this Agreement to the contrary
notwithstanding, Seller shall have the right, but not the obligation, to
make
any improvements to the Property (including without limitation installation
of a
fitness center) which are made in the ordinary course of business or which
otherwise are reasonably deemed by Seller to be convenient or advantageous
to
the Property, provided that, except as otherwise provided in this Agreement
or
any of the Leases, such improvements shall be made the cost and expense of
Seller.
16
8.2 Leasing
Activities.
Until
the Closing or earlier termination of this Agreement, Seller shall (a) not
amend
or modify or renew (except pursuant to existing renewal and/or extension
provisions in such Leases) the terms of any of the Leases (not including
the
Operating Lease) or enter into new leases for all or any portion of the
Property, without Buyer’s consent (which consent, except in respect of the
Operating Lease, Buyer shall not unreasonably deny, delay or condition),
except
that Seller (in addition to any renewal pursuant to an existing renewal and/or
extension rights) shall have the right (but not the obligation), in Seller’s
sole discretion, to enter into new leases or extensions of existing Leases
in
the ordinary course of business, provided that the terms of such new leases
or
new extensions shall not be greater than one (1) year (unless cancelable
without
penalty or premium after such one (1) year; it being agreed that Buyer shall
not
unreasonably withhold, delay or condition its consent or approval to such
new
leases or extensions of existing Leases which shall have a term greater than
one
(1) year), and (b) perform its obligations as landlord under the Leases and
shall advise Buyer of any notices of default received by Seller from tenants
under the Leases (not including the Operating Lease). Notwithstanding anything
to the contrary contained in this Agreement, Seller reserves the right, but
is
not obligated, to institute summary or other proceedings against any tenant
(including without limitation the Restaurant Tenant and/or the Operating
Tenant)
as a result of a default by the tenant under its Lease prior to the Closing
Date. Anything in this Agreement to the contrary notwithstanding, Seller
makes
no representations and assumes no responsibility with respect to the continued
occupancy of the Property or any part thereof by any tenant (including without
limitation the Restaurant Tenant) and Seller may terminate any Lease (including
without limitation the Restaurant Lease and/or the Operating Lease) and/or
allow
same to expire prior to Closing in accordance with the provisions of such
Lease.
Further, Buyer expressly agrees that it shall not be grounds for Buyer’s refusal
to close this transaction that any tenant (including without limitation the
Restaurant Tenant and/or the tenant under the Operating Lease) is a holdover
tenant or is in default under its Lease on the Closing Date, or that such
Lease
has expired or been terminated by Seller in accordance with its terms; and
(unless Seller has exercised a right not to close, in accordance with this
Agreement) Buyer shall accept title subject to such holding over or such
default, or with such Lease expired or terminated, with no reduction in or
abatement of the Purchase Price and no liability on the part of Seller in
connection therewith.
8.3 Service
and Supply Contracts; & Other Agreements.
Until
the Closing or earlier termination of this Agreement, without Buyer’s prior
written consent (which consent Buyer shall not unreasonably deny, delay or
condition), Seller shall not (a) enter into any new service or supply contract,
or renew any Service Contract except pursuant to existing renewal and/or
extension provisions in such Service Contracts, that will be binding on either
Buyer or the Property from and after the Closing, except that Seller (in
addition to any renewal pursuant to an existing renewal and/or extension
right)
shall have the right (but not the obligation), in Seller’s sole discretion, to
enter into new Service Contracts or extensions of existing Service Contracts
in
the ordinary course of business, provided that the terms of such new or new
extensions shall not be greater than one (1) year (unless cancelable without
penalty or premium after such one (1) year; it being agreed that Buyer shall
not
unreasonably withhold, delay or condition its consent or approval to such
new
Service Contracts or extensions of existing Service Contracts which shall
have a
term greater than one (1) year), and/or (b) enter into any other contract
or
agreement (including any mortgage) that will be binding on either Buyer or
the
Property from and after the Closing. Anything in this Agreement to the contrary
notwithstanding, Seller makes no representations and assumes no responsibility
with respect to the continued effectiveness of any Service Contract and Seller
may terminate any Service Contract (and/or allow same to expire) prior to
Closing. Further, Buyer expressly agrees that it shall not be grounds for
Buyer’s refusal to close this transaction that the contractor(s) under any
Service Contract(s) are in default under on the Closing Date, or that such
Service Contract has expired or been terminated by Seller in accordance with
its
terms; and (unless Seller has exercised a right not to close, in accordance
with
this Agreement) Buyer shall accept title subject to such default, or with
such
Service Contract terminated or expired, with no reduction in or abatement
of the
Purchase Price and no liability on the part of Seller in connection
therewith.
17
8.4 Insurance.
Seller
shall maintain in full force and effect all of its existing insurance until
the
Closing Date.
8.5 Operations.
During
the thirty (30) day period immediately preceding the Closing Date, and provided
Buyer shall give reasonable prior written notice to Seller, Buyer shall have
reasonable access at reasonable intervals during normal business hours to
the
books, records and other information concerning the operations of the Hotel
that
are in the possession of the Seller or Seller’s Manager and located in the
Hotel, solely to assist Buyer in effectuating a smooth transition in the
ownership and management of the Property at the Property; provided,
however,
that
(i) Buyer and the Buyer Parties shall not interfere with the normal management
and operation of the Property, (ii) s Buyer and the Buyer Parties shall hold
all
information acquired from such books and records confidential in accordance
with
the provisions of this Agreement and any separate confidentiality agreement
signed by Buyer, (iii) Buyer shall repair any damage to the physical condition
of the Property caused by Buyer or its agents in any such activities, (iv)
Buyer
and the Buyer Principals, jointly and severally, shall protect, defend (with
counsel reasonably acceptable to Seller), indemnify, and hold harmless Seller
and the other Seller Parties from and against any and all liabilities, actions,
suits, mechanics’ liens, judgments, losses, costs, damages, expenses (including,
without limitation, reasonable attorneys’ fees and expenses), claims and demands
of any nature whatsoever suffered or incurred by or made against Seller and/or
such other Seller Parties, arising out of or in any way relating to the acts
or
omissions of Buyer or any of the Buyer Parties, and (v) Buyer shall not be
deemed to have assumed management responsibilities prior to Closing by virtue
of
such access (and the obligations of Buyer and the Buyer Principals under
this
Section shall survive the termination of this Agreement.
8.6 Covenants
Regarding Employees.
Seller
shall or shall cause Seller’s Manager to terminate all Hotel Employees as of
Closing. Buyer and Seller agree to cooperate reasonably with each other to
the
extent legally permissible in the defense of any claims brought by or on
behalf
of Hotel Employees or former employees against Seller or Buyer. With respect
to
any information concerning any employees made available to Buyer, Buyer shall
observe all Legal Requirements relating to the privacy of the information,
and
shall indemnify, defend and save harmless Seller from and against all claims
demands, actions, losses, damages, liabilities, costs and expenses (including
reasonable attorneys’ fees) filed against or incurred by Seller to the extent
arising out of any breach (or alleged breach) of the obligations and agreements
of Buyer under this Section
8.6;
provided, however, that to the extent Buyer is obligated to indemnify, defend
and hold harmless Seller hereunder, such obligation shall be an obligation
of
Buyer and Buyer’s Principals, jointly and severally. The provisions of this
Section
8.6
shall
survive the Closing.
8.7 Reservations,
Marketing and Sales.
(a) Marketing
and Sales.
While
this Contract is in effect, Seller shall to use commercially reasonable efforts
to take Guest Bookings and enter into Occupancy Agreements (except to the
extent
that such Occupancy Agreement are in respect of the premises demised under
the
Operating Lease, in which case they shall be governed by the Operating Lease)
in
the ordinary course of business in accordance with its past practices. While
this Contract is in effect, Seller shall continue to support all marketing
and
sales functions at the Property (except in respect of catering, the marketing
and sales respecting which shall be the obligation of the tenant under the
Operating Lease) and promote the business of the Property in generally the
same
manner as Seller did prior to the execution of this Agreement (except in
respect
of catering, the promotion respecting which shall be the obligation of the
tenant under the Operating Lease).
(b) Pre-closing
Reservations.
All
inquiries received by Seller prior to the Closing from business generators
seeking to make advance Guest Bookings, reservations or enter into Occupancy
Agreements (except to the extent that such Occupancy Agreement are in respect
of
the premises demised under the Operating Lease, in which case they shall
be
governed by the Operating Lease) for the Property will be booked at the Property
in accordance with the standard practices of Seller and at rates, prices
and
upon terms customarily charged by Seller and Seller’s Manager for such uses and
services.
18
(c) Cancellations.
Neither
Seller nor Seller’s Manager shall, without the prior written consent of Buyer
(which consent Buyer agrees not to unreasonably withhold, delay or condition),
cancel any existing Occupancy Agreement or new Occupancy Agreement obtained
after the Effective Date, except in the event of (i) a default by the other
party to such Occupancy Agreement or (ii) the booking of a replacement Occupancy
Agreement which is more advantageous (ie., better price or terms) to the
Hotel
than the terminated Occupancy Agreement and either the Occupancy Agreement
permits Seller to cancel, or the other party to the Occupancy Agreement agrees
to the cancellation.
Section
9. Closing
and Closing Obligations.
9.1 Closing.
The
closing of the transaction contemplated hereby (the “Closing”)
shall
occur on December 29, 2005 or on the next preceding Business Day if such
date is
not a Business Day, at a time of no later than 2:00 p.m. Eastern Standard
Time
(the “Scheduled
Closing Date”);
provided,
however,
(i)
Seller shall have the right to adjourn the Scheduled Closing Date one or
more
times pursuant to and in accordance with Section
6.2
and/or
for any other reason, provided that, except for adjournments pursuant to
Section
6.2,
Seller
shall not adjourn the Scheduled Closing Date for a period or periods in excess
of sixty (60) days in the aggregate and (ii) time
shall be of the essence as against Buyer
as to
the Scheduled Closing Date set forth above, provided,
however,
that
Buyer, upon payment to Seller (by wire transfer of immediately available
federal
funds to the account designated by Seller) of an additional deposit in the
amount of Two Hundred Thousand Dollars ($200,000) prior to the Scheduled
Closing
Date (the “Closing
Adjournment Payment”)
shall
have the right to extend the Closing by written notice to Seller one or more
times provided that such adjournment shall not in any event be beyond March
28,
2006 (the Scheduled Closing Date, as may be adjourned or extended pursuant
to
this provision, the “Closing
Date”);
provided, however that (a) the first such extension by Buyer shall be effective
only if notice thereof is given by Buyer to Seller prior to the Scheduled
Closing Date set forth above, accompanied by simultaneous payment by Buyer
to
Seller of the Closing Adjournment Payment and (b) any subsequent such extension
shall be effective only if notice thereof is given by Buyer to Seller prior
to
the date to which the Scheduled Closing Date previously has been duly adjourned
pursuant to this provision, (c) in no event shall Buyer have the right to
adjourn the Scheduled Closing Date unless Buyer has paid to Seller the Closing
Adjournment Payment and (d) in no event shall Buyer have the right to adjourn
the Scheduled Closing Date beyond March 28, 2006, and time
shall be of the essence as against Buyer
as to
such adjourned Closing Date.
9.2 Seller’s
Closing Obligations. (a) On the Closing Date, Seller
shall execute, acknowledge (if necessary) and deliver to Buyer, and/or
pay,
as the
case may be, the following:
(i) The
Deed
with such changes as may be reasonably required by Seller to conform to the
prevailing facts;
(ii) An
unitemized xxxx of sale conveying to Buyer (without representation or warranty,
except as hereinafter provided) Seller’s interest in and to the tangible
Personal Property, in substantially the form attached hereto as Exhibit C,
with
such changes as may be reasonably required by Seller to conform to the
prevailing facts (the “Xxxx of Sale”); provided, however, that except in respect
of (1) those items of tangible Personal Property which are subject to a
financing or leasing agreement otherwise entered into by Seller in accordance
with the provisions of this Agreement and which do not, in the aggregate,
require monthly payments in excess of $2,000.00, and (2) those items of tangible
Personal Property which are subject to a financing or leasing agreement
described on Schedule C, the Xxxx of Sale shall provide a warranty by Seller
than Seller has not leased, pledged, encumbered or hypothecated such items.
19
(iii) An
affidavit from Seller in substantially the form attached hereto as Exhibit
F
(the “Affidavit of Title”);
(iv) An
assignment and assumption agreement assigning to Buyer (without representation
or warranty) all of Seller’s right, title and interest in and to the Leases (to
the extent then in effect), in substantially the form attached hereto as
Exhibit
D, with such changes as may be reasonably required by Seller to conform to
the
prevailing facts (the “Assignment and Assumption of Leases”);
(v) An
assignment and assumption agreement assigning to Buyer (to the extent freely
assignable, and without representation or warranty) all of Seller’s right, title
and interest in and to the Service Contracts, in substantially the form attached
hereto as Exhibit E, with such changes as may be reasonably required by Seller
to conform to the prevailing facts (the “Assignment and Assumption of
Contracts”);
(vi) An
assignment and assumption agreement assigning to Buyer (to the extent freely
assignable, and without representation or warranty) all of Seller’s right, title
and interest in and to any Permits (not including Seller’s Liquor License), in
substantially the form attached hereto as Exhibit G, with such changes as
may be
reasonably required by Seller to conform to the prevailing facts (the
“Assignment and Assumption of Permits”);
(vii) Intentionally
omitted;
(viii) A
Certificate of Non-Foreign Status from Seller in the form required by law
in
order to establish that Seller is not a foreign person or a nonresident person
for purposes of Section 1445 of the Internal Revenue Code of 1986,
respectively;
(ix) Notices
to the Tenants under the Leases and providers under the Service Contracts,
informing them of the sale and transfer of the Property to Buyer (“Notices to
Tenants and Service Providers”); Seller shall cooperate with Buyer in furnishing
the Notices to Tenants and Service Providers but Buyer shall be responsible
for
delivery of such notices;
(x) A
settlement statement (the "Settlement Statement") documenting the Closing
and
reflecting the Purchase Price, charges, credits, adjustments and
prorations;
(xi) Such
documents (such as limited liability company resolutions, good standing
certificates, corporate resolutions or partnership authorizations and certified
limited liability company, corporate or partnership organizational documents)
as
are reasonably required by Buyer or the Title Company to evidence the existence
and good standing of Seller and the authority of Seller as a limited liability
company to enter into and consummate the transactions contemplated by this
Agreement;
(xii) All
forms, affidavits and certificates required to be filed in connection with
the
imposition and/or payment of any and all applicable federal, state, county,
municipal and other real property transfer taxes with respect to the
transactions set forth herein (collectively, the “Conveyance Tax Documents”), in
proper form for submission, prepared, executed and acknowledged by
Seller;
20
(xiii) A
schedule of all Occupancy Agreements as of the Closing Date (the “Occupancy
Agreement Report”) and copies of the Occupancy Agreements, if any. The Occupancy
Agreement Report shall be in Seller’s standard reporting format;
(xiv) An
updated Guest Bookings Report as of the Closing Date in Seller’s standard
reporting format and including, without limitation, the name and contact
information for such reservation, the average rate, the number of room nights,
projected revenue, arrival and departure dates and the amount of any prepaid
expenses and Advance Deposits related thereto;
(xv) A
statement of all delinquencies under the Leases (not including the Operating
Lease);
(xvi) Schedule
of Accounts Receivable updated to the Closing Date;
(xvii) All
Records (to the extent in the possession of Seller);
(xviii) All
original (to the extent in the possession of Seller) or (to the extent in
the
possession of Seller)certified copies of Lease Files (not including the
Operating Lease) and Service Contracts;
(xix) Evidence
of the termination of the Management Agreement;
(xx) Intentionally
omitted;
(xxi) An
updated Schedule of Leases, if applicable, and an updated Schedule of Service
Contracts, if applicable;
(xxii) A
certificate stating
that
each of the representations and warranties of Seller contained in this Agreement
are made as of the Closing Date and are true and correct, subject only to
those
variations from such representations and warranties as are either specifically
permitted by this Agreement or as are set forth in the
certification;
(xxiii) All
Hotel
building and guest room keys and the combinations to all safes located in
the
Hotel; and keys to safe deposit boxes (if any) at the Hotel which are not,
at
the Closing, in use by guests, all receipts and agreements relating to all
safe
deposit boxes (if any) and a complete list of all safe deposit boxes in use
by
guests, which list shall contain the names and room numbers of each
depositor;
(xxiv) Only
if
and to the extent such assignment shall be lawful, an assignment
and
assumption agreement assigning to Buyer (and/or, as directed by Buyer, the
tenant under the Operating Lease), without representation or warranty by
Seller,
and otherwise in form and substance reasonably acceptable to the parties,
all of
Seller’s right, title and interest in and to
the
ownership interests in Wilshire
Hospitality Services, LLC and Wilshire Hospitality Services II, LLC,
the
entities to which were issued, at the request of Seller or an affiliate of
Seller, the liquor licenses for the Hotel and the catering facility
(not
including any liquor license owned or held by, or leased to, the tenant under
the Restaurant Lease or any other Lease), and pursuant to which Buyer (and/or,
as directed by the Buyer, the Tenant under the Operating Lease) shall assume,
as
of the Closing all such ownership interests and the rights and obligations
respecting same (the “Assignment and Assumption of Ownership
Interests”).
21
(xxv) All
other
documents necessary to consummate the transactions contemplated by this
Agreement, provided same do not increase the obligations of Seller nor diminish
the rights of Seller.
(b) On
the
Closing Date, to the extent the same are not credited against the Purchase
Price
or will not be paid from the proceeds of the sale of the Property, Seller
shall
pay such closing costs and prorations that are to be paid by Seller as provided
in this Agreement.
9.3 Buyer’s
Closing
Obligations. On
the
Closing Date, Buyer
shall:
(a) Pay
to
Seller the Purchase Price, as same may be adjusted pursuant to this Agreement
for all closing costs and prorations to be paid by Buyer as provided herein,
(b) Pay
all
other sums required to be paid by Buyer as of the Closing Date in order to
consummate the transactions contemplated by this Agreement or owed by Buyer
to
Seller as of the Closing Date pursuant to any provision of this Agreement;
(c) Execute
(as applicable) acknowledge (if necessary) and deliver to Seller,
the
following:
(i)
The
Xxxx
of Sale;
(ii)
The
Assignment and Assumption of Leases (pursuant to which Buyer shall assume
all
obligations under the Lease from and after the Closing);
(iii)
The
Assignment and Assumption of Contracts (pursuant to which Buyer shall assume
all
obligations under the Service Contracts from and after the Closing;
(iv)
The
Assignment and Assumption of Permits (pursuant to which Buyer shall assume
all
obligations under the transferred Permits from and after the
Closing);
(v)
The
Conveyance Tax Documents;
(vi)
The
Sales
Tax Documents;
(vii)
The
Ownership Evidence;
(viii) If
same
shall be lawful, the Assignment and Assumption of Ownership
Interests;
(ix)
The
Notices to Tenants and Service Providers;
(x) Such
documents (such as limited liability company resolutions, good standing
certificates, corporate resolutions or partnership authorizations and certified
limited liability company, corporate or partnership organizational documents)
as
are reasonably required by Seller or the Title Company to evidence the existence
and good standing of Buyer and the authority of Buyer as a limited liability
company to enter into and consummate the transactions contemplated by this
Agreement;
(xi)
The
Xxxxxxx Release (if not previously delivered to Seller and Seller has not
previously exercised its right to terminate this Agreement by reason of the
non-delivery thereof); and
22
(xii)
The
Settlement Statement;
(d) Enter
into an Employment Agreement with Xxxxx Xxxxxxx (the “Xxxxxxx
Employment Agreement”),
in
form and substance reasonably satisfactory to Buyer and Xxxxx Xxxxxxx, pursuant
to which Xxxxx Xxxxxxx shall be employed by Buyer for not less than the nine
(9)
month period from and after the Closing as general manager of the Hotel and
the
other facilities at the Property, having duties and authority substantially
equivalent to those he had and exercised immediately prior to the Effective
Date, at a salary and benefits not less than the salary and benefits he received
as general manager of the Hotel immediately prior to the Effective Date;
provided, however, that Buyer shall not be required to enter into such
Employment Agreement unless (A) Xxxxx Xxxxxxx is, immediately prior to the
Closing, employed by Buyer as general manager of the Hotel and (B) Xxxxx
Xxxxxxx
is, at the time of the Closing, willing to enter into such agreement with
Buyer;
and
(e) Perform
and satisfy, or cause to be performed and satisfied, all other obligations
and
conditions on the part of Buyer to be performed or satisfied as of
the
Closing Date under this Agreement.
9.4
Closing
Costs.
Expenses in connection with the transaction contemplated
by this
Agreement shall be paid as follows:
(a) Seller
shall pay for the following: (i) Seller’s attorneys’ fees; (ii) all recording
fees and filing fees to record any release of any mortgages or other liens
affecting the Property which are not Permitted Exceptions and which Seller
is
required to pay or discharge pursuant to this Agreement; and (iii) the
conveyance tax due on the conveyance and sale of the Real Property to Buyer,
as
provided in Section
9.5.
(b) Buyer
shall pay for the following: (i) Buyer’s attorneys’ fees; (ii) all recording and
filing fees to record the Deed and other conveyance documents, (ii) the cost
of
the Owner’s Title Policy in the amount of the Purchase Price, plus any
additional cost for an extended policy and any endorsements thereto and any
survey or survey updates or certifications or title searches; and (iii) any
applicable sales taxes as provided in Section
9.5.
Buyer
and Buyer’s Principals, jointly and severally will indemnify, defend (with
counsel reasonably acceptable to Seller) and hold Seller and/or the other
Seller
Parties harmless from applicable sales taxes, and all fines, interest and
penalties charged in connection therewith, and this provision shall survive
the
Closing.
(c) The
provisions of this Section
9.4
shall
survive the Closing or the earlier termination of this Agreement.
9.5 Sales
and Transfer Taxes.
At the
Closing, Seller shall pay the New Jersey real property transfer taxes imposed
upon or payable in connection with the transfer of title to the Real Property
and the recordation of the Deed, which transfer taxes shall, at Seller’s
election, be allowed for out of the Purchase Price and paid by Buyer on behalf
of Seller at the Closing. At the Closing, Seller and Buyer shall each execute,
acknowledge (if appropriate) and deliver the Conveyance Tax Documents to
the
Title Company or to the appropriate governmental offices. At the Closing,
Buyer
shall pay all applicable sales taxes in connection with the sale and conveyance
of the Personal Property, and Seller and Buyer shall each execute, acknowledge
(if appropriate) and deliver any required sales tax documentation (“Sales
Tax Documents”)
to the
Title Company or to the appropriate governmental offices. The payment of
the
Real Property transfer taxes and Personal Property sales taxes shall be made
payable directly to the order of the appropriate governmental offices. The
provisions of this Section
9.5
shall
survive the Closing.
23
9.6 Conditions
to the Obligations
of
Seller to Close.
(a) The
obligation of Seller to close hereunder shall be subject to the satisfaction
of
each of the following conditions.
(i) Buyer
shall
have performed all of Buyer’s material obligations and covenants under this
Agreement to be performed at or prior to the Closing, including without
limitation the payment of all amounts to be paid by Buyer (including without
limitation the Purchase Price) and the delivery of all documents to be delivered
by Buyer (including without limitation the Xxxxxxx Release).
(ii) All
of
the representations and warranties of Buyer hereunder shall be true, complete
and correct in all material respects.
(iii) There
shall have occurred no default under the Operating Lease beyond any applicable
notice and cure period, nor shall there have occurred any of the events
described in Section 9.01 of the Operating Lease.
(iv) Seller
shall have obtained the ISRA Compliance Instrument, as provided in Section
15.
(b) If
any of
the forgoing conditions are not satisfied, then Seller may elect (1) to
terminate this Agreement, (2) to waive noncompliance with any such condition,
or
(3) with respect to a default by Buyer under this Agreement, the remedies
available to Seller for a default by Buyer as set forth in Section
14.3
hereof:
9.7 Conditions
to the Obligations of Buyer to Close.
(a) The
obligations of Buyer to close hereunder shall be subject to the satisfaction
of
each of the following conditions.
(i) Seller
shall have performed all of Seller’s material obligations and covenants under
this Agreement to be performed at or prior to the Closing.
(ii) All
of
the representations and warranties of Seller hereunder shall be true, complete
and correct in all material respects as of the Closing Date; provided, however,
that Seller shall be permitted to update information as of the Closing Date
as
permitted or in accordance with the requirements of this Agreement; and Seller
shall have delivered at the Closing the certificate described in Section
9.2(a)(xii) of
this
Agreement.
(iii) The
Title
Company, or any other title company licensed to do business in New Jersey,
shall
be willing to issue to Buyer the Owner’s Title Policy in form and substance
consistent with the provisions of Section 6 hereof.
(b) If
any of
the forgoing conditions are not satisfied, then Buyer may elect (1) to terminate
this Agreement, (2) to waive noncompliance with any such condition, or (3)
with
respect to a default by Seller under this Agreement, the remedies available
to
Buyer for a default by Seller as set forth in Section
14.2
hereof:
9.8 Possession.
At the
Closing, Seller shall cause possession of the Hotel to be delivered to Buyer
immediately upon Closing, free and clear of all leases, tenancies and
occupancies, except for (i) the Leases and rights of tenants under the Leases,
(ii) the Service Contracts, (iii) the Permitted Exceptions, (iv) Hotel guests,
(v) Occupancy Agreements, and (vi) Permitted Exceptions.
24
Section
10. Prorations.
10.1 Items
to
be Prorated.
All
taxes, assessments, charges, expenses, room revenues and other income shall
be
prorated between Seller and Buyer as of the Cut-Off Time (except as otherwise
specifically provided). The intent of the closing date adjustment set forth
in
this Section
10.1
(the
“Closing
Date Adjustment”)
is to
credit or charge, as the case may be, Seller with all revenues and expenses
respecting the Property which are attributable to operations before the Cut-Off
Time (except as otherwise specifically provided) and to credit or charge,
as the
case may be, Buyer with all such revenues and expenses attributable to
operations on or after the Cut-Off Time (except as otherwise specifically
provided). Without limiting the generality of the foregoing, specific charges
and income shall be prorated as follows:
(a) Real
Property Taxes.
(i) All
real property taxes and assessments shall be prorated as of the Closing Date
on
a per diem basis. Seller shall be responsible for all such taxes and
installments of assessments accruing with respect to the Property prior to
the
Closing Date and Buyer shall be responsible for all such taxes and assessments
(with respect to the Property) which accrue from and after the Closing Date.
Any
tax refunds or rebates which apply to periods before the Closing Date shall
remain the property of Seller. If the final amount of such taxes and/or
assessments and/or liens is not known at the time of Closing (whether by
reason
of a change in the Property value or the applicable tax rates or otherwise),
then to the extent not known the proration shall be based upon the final
xxxx
for the immediately preceding fiscal year for such charge, provided that,
if the
actual charges for such items for the current year are more or less than
the
charges for the preceding year, Seller and Buyer shall adjust the proration
of
such items and Seller or Buyer, as the case may be, shall pay to the other
within ten (10) calendar days after demand any amount required as a result
of
such adjustment and this covenant shall not merge with the Deed but shall
survive the Closing. Nothing in this provision shall waive or affect the
obligations of the tenant under the Operating Lease, to make payments on
account
of real property taxes
(ii)If,
subsequent to the Closing Date, any proceeding shall result in a reduction
of
any assessment, tax or other charge for the applicable fiscal year in which
the
Closing occurs, the amount of the savings or refunds for such fiscal year,
less
the reasonable expenses (including reasonable fees and disbursements payable
to
attorneys or consultants) incurred in connection with such proceedings shall
be
apportioned between Seller and Buyer as of the Closing Date as if the reduction
had been known as of that date. Neither Seller nor Buyer will withdraw, settle
or compromise any reduction proceeding affecting the Property without the
prior
written consent of the other, which consent shall not be unreasonably withheld
or delayed, except that the consent of Seller shall not be required for the
fiscal years after that in which the Closing Date occurs, and the consent
of
Buyer shall not be required for fiscal years in which the Closing Date occurs
and prior thereto. The party benefited by the reduction shall promptly pay
the
other party said party's share of such reduction (it being agreed, however,
that
Seller shall be obligated to pay to Buyer Buyer’s share of any reduction to
which Buyer may be entitled hereunder, only if Seller actually receives payment
of the reduction, and then only in proportion to the amount Seller actually
receives). Seller shall be entitled to keep and retain all of the savings
or
refunds from any proceeding which results in a reduction of any assessment,
tax
or other charge for any fiscal year prior to the applicable fiscal year in
which
the Closing occurs, and shall have sole control over any such proceeding;
Buyer
shall be entitled to keep and retain all of the savings or refunds from any
proceeding which results in a reduction of any assessment, tax or other charge
for any fiscal year after the applicable fiscal year in which the Closing
occurs, and shall have sole control over any such proceeding. This provision
shall survive the Closing.
(b) Permit
Fees.
Current
payments (that is, attributable to the year or other applicable period in
which
the Closing occurs) of fees and charges under any licenses, permits,
certificates or approvals relating to the Property, or the use or occupancy
thereof, if any (but this shall apply to the Liquor License only if the
Assignment and Assumption of Ownership Interests is executed and delivered
at
the Closing).
25
(c) Sewer
and other public utility charges.
If
consumption of sewer service is measured by meters, prior to the Closing
Date
Seller shall obtain a reading of each such meter and a final xxxx as of the
Closing Date. If there is no such meter or if the xxxx for any of the foregoing
will not have been issued as of the Closing Date, the charges therefor shall
be
adjusted as of Closing Date on the basis of the charges of the prior period
for
which such bills were issued and shall be further adjusted between the parties
when the bills for the correct period are issued (and this obligation shall
survive the Closing).
(d) Rent.
Rent
and additional rent under the Leases shall be prorated as of the Cut-Off
Time on
a per diem basis and Buyer shall receive a credit for its proportionate share
of
the rent previously actually received by Seller for the month in which the
Closing Date occurs and for all rent actually prepaid by more than thirty
(30)
days. Buyer shall receive a credit for all cash Advance Deposits (if any)
that
Seller holds as of the Closing Date, other than any assignable certificates
of
deposit or letters of credit, which shall be assigned to Buyer, provided
that
Buyer and Buyer’s Principals, jointly and severally, indemnify, defend (with
counsel reasonably acceptable to Seller) and hold Seller and the other Seller
Parties harmless from any and all obligations relating to such Advance Deposits
assigned to Buyer. Seller shall cooperate with Buyer and execute all reasonable,
necessary documents and instruments and undertake communications with parties
to
such certificates of deposits and letters of credit to facilitate their transfer
to Buyer. Buyer shall be responsible for setting up accounts and making
necessary deposits with respect to cash Advance Deposits. At Closing, Seller
shall provide Buyer with a statement of arrearages, if any, under the Leases.
If
the any of the Leases contains obligations for utility charges, rent escalations
for taxes or other operating expenses, insurance or other forms of additional
rent, and Seller shall have collected any portion of such additional rent
for a
period on or after the Closing Date, then the same shall be apportioned and
credit given to Buyer for such period. If such additional rent have not been
billed, or if billed, have not been collected by Seller as of the Closing
Date,
then Buyer shall (i) in good faith and with due diligence xxxx and collect
such
additional rent and when the amount of such additional rent is determined
and
collected by Buyer, the same shall be apportioned as provided herein, (ii)
to
the extent allocable to Seller, hold the first monies so received in trust
for
the benefit of Seller, and (iii) to the extent required to pay the amounts
due
to Seller for the period up to the Closing Date, promptly remit the same
to
Seller.
(e) Utilities.
Prior
to the Closing, Seller shall notify all utility companies servicing the Property
of the anticipated change in ownership and request that all xxxxxxxx after
the
Closing be made to Buyer at the Hotel address. As close as practicable to
the
anticipated Closing Date, Seller shall request that the utility companies
perform final readings on all gas, water and electric meters on or before
the
Closing Date, if possible. If final readings are not possible, gas, water,
phone
line, cable televisions (if any), satellite television service (if any),
internet service (if any) and electric charges will be prorated based on
the
most recent period for which costs are available. Seller shall be responsible
for charges before the Closing and Buyer shall be responsible for charges
from
and after the Closing. There shall be no proration with respect to Seller
deposits, retentions, and holdbacks then being held by any utility company,
all
of which shall remain the property solely of Seller. Buyer shall be responsible
for setting up accounts and making necessary deposits with any utility
company.
(f) Service
Contracts & Other Agreements.
(i)
Current charges and payments under the Service Contracts shall be prorated
as of
Closing. Any prepaid charges or transferable deposits paid by Seller under
the
Service Contracts shall be credited to Seller at the Closing. Any
non-transferable deposits shall remain the property solely of
Seller.
26
(ii) Any
other
provisions of this Agreement to the contrary notwithstanding, including without
limitation the provisions of Section 4.2(a), Section 6.1(a)(iv), Section
7.1(a)(iii), and, Section 10.1(f)(i), (A) prior to the Closing Seller shall
pay
and discharge the Air Conditioning Agreement, and (B) if for any reason any
of
the equipment leases, financing leases or agreements or similar financing
instruments which are included as Service Contracts cannot be duly assigned
to
Buyer and assumed by Buyer at the Closing, with Seller released from all
obligations in respect of such Service Contracts accruing from and after
the
Closing (including without limitation inability or failure by Seller to obtain
any necessary consent to such assignment and/or release of Seller), then
(x)
Seller shall have the right, at or prior to the Closing, to pay and discharge
such equipment leases, financing leases or agreements or similar financing
instruments and (y) at the Closing Buyer shall pay to Seller, as additional
purchase price, the amounts (if any) paid by Seller to pay and discharge
such
equipment leases, financing leases or agreements or similar financing
instruments.
(g) Cash
House Funds, Guest Ledgers and Accounts Receivable.
All
cash on hand in the Hotel in cash registers, cashiers’“banks”, and change funds
as of the Cut-Off Time will be purchased by Buyer and credited (in the amount
thereof) to Seller and debited (in the amount thereof) to Buyer. All House
Funds
shall remain the sole property of Seller and shall be applied and returned
to
Seller at the Closing. “House
Funds”
shall
mean cash on hand in the Hotel’s operating accounts and restricted and other
cash accounts (e.g., payroll accounts, credit card accounts, money market
accounts, xxxxx cash bank accounts, travel agent commission accounts and
accounts for excess operating funds) maintained by Seller with respect to
the
Hotel as of the Cut-Off Time. All amounts in the Guest Ledger (including
charges
for rooms, food, beverage, telephone charges and otherwise) accruing prior
to
the Cut-Off Time, shall be purchased by Buyer and credited to Seller (in
the
amount thereof), and all amounts in the Guest Ledger accruing after such
time
shall belong to Buyer; however, Seller’s credit for the amounts which are
attributable to the night preceding the Closing Date shall be fifty percent
(50%) of such amounts. The entire Guest Ledger shall thereupon become the
property of Buyer. “Guest
Ledger”
shall
mean any accounts of guests of the Hotel who have not checked out as of the
Cut-Off Time, subject to customary underwriting (i.e., credit card deposits,
etc.). Buyer shall receive a credit for all prepaid rents and all Advance
Deposits and advance payments under Guest Bookings, Occupancy Agreements,
tradeout agreements, discounts, complimentary rooms, coupons and gift
certificates for use of the Property on and after the Closing Date. Any Advance
Deposits or advance payments received by Seller from and after the Closing
with
respect to Guest Bookings or Occupancy Agreements for dates from and after
the
Closing shall be forwarded to Buyer upon receipt by Seller. Seller makes
no
representation or warranty concerning, and shall have no liability or obligation
in connection with, the collectibility of any accounts assigned or transferred
by Seller to Buyer (and this sentence shall survive the Closing).
(h) Accounts
Payable and Expenses.
Subject
to the following, all unpaid accounts payable due from
the
Hotel and all expenses payable by
the
Hotel (not including, for instance, accounts payable by, and expenses of,
guests, patrons, and/or customers) accrued prior to the Closing and relating
to
operations of the Property prior to the Closing shall be paid by Seller.
Buyer
alone shall be responsible for all accounts payable related to Personal
Property, Service Contracts, or otherwise to the extent not yet delivered,
or
services, to the extent not yet rendered, as of the Closing, providing the
same
are incurred in the ordinary course of business, and such Personal Property,
Service Contracts or other items are delivered and/or such services rendered,
after the Closing. In addition to the foregoing, all accounts payable and
expenses relating to operations of the Property after Closing will be paid
by
Buyer. Prepaid expenses with respect to all such items as of the Closing
Date
shall be prorated and credited to Seller.
27
(i) Employee
Compensation.
Seller
shall pay all wages and fringe benefits (including accrued vacation pay,
sick
pay, payroll taxes and retirement and insurance benefits), if any, of all
Hotel
Employees for the period up to but not including the Closing Date.
10.2 Obligations
of Tenants.
Notwithstanding anything to the contrary in Section
10.1,
except
as otherwise provided in this Section 10, no adjustments between Seller and
Buyer shall be made for any payment of operating expenses which are obligations
of Tenants under the Leases which have not been paid by such Tenant (unless
Seller shall have paid such amounts on behalf of such Tenants or Seller shall
be
due amounts from such tenants, in which case Buyer and Seller shall adjust
for
such items), and Buyer shall look solely to such Tenants for the payments
of
such items.
10.3 Preliminary
Statement of Prorations and Adjustments; Post-closing Adjustment.
No
later than five (5) Business Days before the Closing Date, Seller shall prepare
and provide to Buyer for its review and comment a preliminary statement of
the
prorated and adjusted items set forth above (collectively, the “Prorations”).
At
least two (2) Business Days prior to Closing, Buyer and Seller shall agree
on
Prorations for the purposes of Closing, subject, however, to a final adjustment
and review immediately prior to and as of the Cut-Off Time. If the amount
of any
prorated item or adjusted item is not known at the Closing, the parties agree
that such items shall be prorated at the Closing upon the basis of the best
information available, and shall be adjusted when the actual amount(s) of
such
items are known, with appropriate charges and credits to be made. Not
later
than thirty (30) days after the Closing Date, Buyer and Seller shall review
all
of the amounts and calculations made with respect to the Closing Date
Adjustment, and any final correction shall be made to the Closing Date
Adjustment, and Seller and Buyer at that time shall settle any funds owed
to
each other.
10.4 No
apportionment shall be made of any insurance premiums, nor will any insurance
policies benefiting or relating to Seller or the Property be assigned to
Buyer.
10.5 The
provisions of this Section
10
shall
survive the Closing.
Section
11 Additional
Covenants.
11.1 Past
Due
Rents and Accounts Receivable.
The
past due rents and accounts receivable on the Closing Date (except for Guest
Ledger receivables purchased by Buyer pursuant to Section
10.1 above)
shall remain the sole property of Seller. Buyer (without charge to Seller)
shall
use commercially reasonable efforts to collect, on Seller’s behalf, delinquent
rents or accounts receivable accrued during the month in which Closing occurs;
provided,
however, that,
after
the Closing, the rents and accounts receivable received by Buyer shall be
applied first to current balances due from such payors, then to delinquent
balances due Buyer from such payors and then to amounts due Seller from such
payors for the month in which the Closing occurred (less reasonable costs
and
legal fees incurred in collection thereof). If Seller receives any rent or
other
sums due under any Leases or accounts receivable attributable to the period
of
time from and after the Closing Date, Seller shall pay over to Buyer any
such
amounts upon the later to occur of the Closing or Seller’s receipt thereof. The
provisions of this Section
11.1
shall
survive the Closing.
11.2 Intentionally
omitted.
11.3 Intentionally
omitted.
28
11.4 Permits.
(a) Buyer
shall be fully responsible for and shall pay all costs and fees required
to be
paid in connection with transfer of any and all Permits currently held by
Seller, and shall pay all transfer and license fees in connection therewith,
as
well as applying for and obtaining any and all new licenses, permits,
certificates and/or approvals necessary or appropriate in connection with
the
operation of the Property and the consummation of the purchase and sale of
the
Property. Buyer shall prosecute its applications in accordance with the rules
and procedures set forth under applicable law. Seller shall, at the sole
cost
and expense of Buyer, cooperate in a reasonable manner to assist Buyer in
obtaining the transfer or issuance of such licenses, permits, certificates
and
approvals. Buyer acknowledges and agrees that it may not be possible to complete
such transfers or issuances prior to the Closing, and Seller covenants and
agrees that it shall cooperate reasonably with Buyer or its management company
for the continued operation of the Property under the existing Permits to
the
extent permitted by applicable law, at the sole cost and expense of Buyer,
and
provided that Buyer at Buyer’s sole cost and expense maintains and keeps in
effect such insurance for the benefit of Seller as Seller may reasonably
required (and Buyer and Buyer’s
Principals,
jointly
and severally, hereby agree to protect, defend (with counsel reasonably
acceptable to Seller), indemnify and hold harmless Seller and the other Seller
Parties from and against any and all liabilities, actions, suits, liens,
fines,
penalties, judgments, losses, costs, damages, expenses (including, without
limitation, reasonable attorneys’ fees and expenses), claims and demands of any
nature whatsoever suffered or incurred by or made against Seller an/or the
other
Seller Parties, arising out of or in any way relating to cooperation and
continued operation of the Property). Anything in this Agreement to the contrary
notwithstanding, nothing in this Agreement shall make Buyer’s obligations under
this Agreement subject to the transferability of any of the Permits to Buyer,
and Buyer’s obligations under this Agreement shall remain unamended and in full
force and effect, and the Closing shall take place as provided in this Agreement
(except that Seller shall not transfer to Buyer any Permit unless it shall
be
lawful and permissible for Seller freely to do so), without any abatement
of or
credit against the Purchase Price nor to any liability on the part of Seller.
This paragraph shall not be applicable to the Liquor License, the transfer
of
which shall be governed by Section
11.15.
(b) The
provisions of Section
11.4(a)
and any
other provision of this Agreement to the contrary notwithstanding, in the
event
that any governmental or quasi-governmental authority requires a resale
certificate, certificate of occupancy, certificate of continued occupancy,
smoke
detector permit, fire alarm permit, fire sprinkler permit, or any other permit,
license, certificate or approval in connection with the transfer of the Property
contemplated by this Agreement, and/or the use or occupancy of the Property
or
any part thereof from or after the Closing, including without limitation
the use
or occupancy of the catering premises demised pursuant to the Operating Lease
(“Certificates”),
Buyer, at Buyer’s sole expense, and in a timely manner, shall be responsible for
procuring and shall procure all such Certificates and shall be responsible
for
making and shall make any repairs, replacements or improvements required
therefor; and the absence of any such Certificate shall not give rise to
any
right on the part of Buyer to omit or fail to close the transaction described
in
this Agreement as and when set forth in this Agreement, nor give rise to
any
abatement of or credit against the Purchase Price nor to any liability on
the
part of Seller; and Buyer and Buyer’s Principals, jointly and severally, shall
indemnify, defend (with counsel reasonably acceptable to Seller) and hold
harmless Seller and the other Seller Parties from and against any and all
claims, demands, losses, fines, penalties, costs, expenses (including attorney's
fees and expenses), liabilities and obligations which Seller and/or the other
Seller Parties may suffer or incur by as a result of the failure or omission
of
Buyer to obtains all such Certificates same in a timely manner (and the
provisions hereof shall survive the Closing). Nothing herein or otherwise
in
this Agreement shall condition the obligations of Buyer under this Agreement
upon the issuance or obtainment of any such Certificates, and notwithstanding
the lack of issuance or obtainment of any thereof, Buyer shall remain fully
liable and obligated as provided in this Agreement.
(c) The
provisions of this Section
11.4
shall
survive the Closing.
29
11.5 Liquor
License.
Without
limiting the generality of the foregoing provisions of Section
11.4,
prior to
the Closing Date Buyer, at Buyer’s sole cost and expense, shall file or cause to
be filed an appropriate application with the New Jersey State Liquor Authority
(and any other appropriate authority) for approval authorizing Buyer (and/or,
as
directed by Buyer, the tenant under the Operating Lease) to acquire, at the
Closing, pursuant to the Assignment and Assumption of Ownership Interests,
the
ownership interests in and to Wilshire Hospitality Services, LLC and Wilshire
Hospitality Services II, LLC,
to each
of which entities was issued, at Seller’s request, one of the two liquor
licenses (collectively, the
“Liquor
License”) for
the
Hotel
(excluding the catering facility) and the catering facility (not
including any liquor license owned or held by, or leased to, the tenant under
the Restaurant Lease or any other Lease,; and
such
applications shall be prosecuted by Buyer with due diligence. Buyer shall
be
solely responsible for obtaining such approval and authorization. Buyer
shall proceed in an expeditious manner and register and qualify Buyer and,
if
applicable, the tenant under the Operating Lease, to do business in the State
of
New Jersey and take other steps for license processing and/or authorization
as
soon as
possible, but, to the extent lawful and permissible, Seller will reasonably
cooperate with Buyer (at the sole cost and expense of Buyer, except that
Buyer
shall not be responsible for the payment of any legal fees of Seller in
connection therewith) to assist Buyer in securing such authorization
expeditiously. The parties acknowledge that federal and state tax clearances
are
required for either transfer of the existing Liquor License or a new license
and, if applicable, the parties shall secure and exchange such certificates
on a
timely basis. Anything
in this Agreement to the contrary notwithstanding, nothing in this Agreement
shall make Buyer’s obligations under this Agreement subject to the
transferability of the Liquor License or to the issuance to Buyer and/or
the
tenant under the Operating Lease of a liquor license or to the assignability
or
assignment to Buyer (and/or the tenant under the Operating Lease) of the
ownership interests in and to Wilshire Hospitality Services, LLC and/or Wilshire
Hospitality Services II, LLC, and notwithstanding that any such liquor license
may not be issued or transferred to Buyer (and/or the tenant under the Operating
Lease), or that such ownership interests may not be transferable or transferred
to Buyer (and/or the tenant under the Operating Lease), or that any liquor
license shall not have been issued to Buyer (and/or the tenant under the
Operating Lease), Buyer’s obligations under this Agreement shall remain
unamended and in full force and effect, and the Closing shall take place
as
provided in this Agreement (except that Seller shall not transfer to Buyer
(and/or the tenant under the Operating Lease) the ownership interests unless
it
shall be lawful and permissible for Seller freely to do so), without any
abatement of or credit against the Purchase Price nor any liability on the
part
of Seller. Anything in this Agreement to the contrary notwithstanding, Buyer
acknowledges that Seller shall have the right, at any time, and at Seller’s sole
option, to deactivate and/or “pocket” the liquor license applicable to the
catering facility at the Property and to take all steps and actions reasonably
deemed appropriate by Seller in connection therewith.
11.6 Leases.
At the
Closing, Buyer shall assume all of the Leases then in effect, pursuant to
the
Assignment and Assumption of Leases. Notwithstanding anything to the contrary
contained in this Agreement, Seller reserves the right, but is not obligated,
to
institute summary proceedings and/or any other proceedings against any tenant
(including without limitation the Restaurant Tenant and/or the Operating
Tenant)
as a result of a default by the tenant thereunder prior to the Closing Date.
Seller makes no representations and assumes no responsibility with respect
to
the continued occupancy of the Property or any part thereof by any tenant
(including without limitation the Restaurant Tenant) and Seller may terminate
any Lease (including without limitation the Restaurant Lease and/or the
Operating Lease) prior to Closing. Further, Buyer agrees that it shall not
be
grounds for Buyer’s refusal to close this transaction that any tenant including
without limitation the Restaurant Tenant) is a holdover tenant or in default
under its Lease on the Closing Date and Buyer shall accept title subject
to such
holding over or default without credit against, or reduction of, the Purchase
Price. Buyer and Buyer’s Principals, jointly and severally, shall indemnify,
defend (with counsel reasonably acceptable to Seller) and hold Seller and
the
other Seller Parties harmless from and against all claims, damages, losses,
liability, costs and expenses (including reasonable attorneys’ fees) incurred by
Seller and/or the other Seller Parties in connection the failure of Buyer,
as
landlord, to perform any obligations under the Leases from and after the
Closing
Date. Seller shall indemnify, defend (with counsel reasonably acceptable
to
Buyer) and hold Buyer harmless from and against all claims, damages, losses,
liability, costs and expenses (including reasonable attorneys’ fees) incurred by
Buyer and/or the other Buyer Parties in connection with the failure of Seller
to
perform any obligations as landlord under the Leases prior to the Closing
Date
and accruing during Seller’s period of ownership of the Property; and this
indemnification obligation of Seller shall survive the Closing for a period
of
twelve months. Except as otherwise herein provided, the provisions of this
Section
11.6
shall
survive Closing or the earlier termination of this Agreement.
30
11.7 Hotel
Employees.
Immediately prior to Closing, Seller shall terminate all Hotel employees
of
Seller, if any, and cause Seller’s Manager to terminate all Hotel employees of
Seller’s Manager. Except for the Xxxxxxx Employment Agreement, Buyer shall have
no obligation to re-hire (or cause its manager to re-hire) such employees
and
shall not have any liability with respect to the termination of such employees;
provided,
however,
that
Buyer agrees that it shall offer employment (or cause its manager to offer
employment) to a sufficient number of Hotel employees such that Seller shall
not
incur any liability under the Worker’s Adjustment and Retraining Notification
Act, 29 U.S.C. Sections 2201, et. seq., or any similar state or local plant
closing law (collectively, “WARN Acts”), if applicable Prior to the Closing
Date, Buyer (or its manager) shall deliver written notice to those Hotel
employees it wishes to re-hire stating that Buyer (or its manager) is continuing
to employ such Hotel employee following the Closing Date. During
the thirty (30) day period prior to Closing, Buyer may interview Seller’s
employees concerning continued employment following the transfer of the Hotel
and transition matters related thereto, provided that Buyer shall give Seller
reasonable advance notice thereof and Seller shall have the right to have
a
representative present during any such interview but the interview may be
conducted notwithstanding the failure of a Seller’s representative to be
present. Anything in this Agreement to the contrary notwithstanding, Buyer
agrees, from and after the Closing, at Buyer’s sole expense, to comply with all
applicable obligations, provisions and requirements, if any, of the Consolidated
Omnibus Budget Reconciliation Act of 1986, as same may have been or may be
amended, and all rules and regulations relating thereto (collectively, “COBRA”)
in connection with all Hotel employees terminated by Seller pursuant to this
provision, including, without limitation, all obligations to offer insurance
to
terminated employees. Buyer and Buyer’s Principals, jointly and severally, shall
protect, defend (with counsel reasonably acceptable to Seller), indemnify,
and
hold harmless Seller and the other Seller Parties from and against any and
all
liabilities, actions, suits, mechanics’ liens, judgments, losses, costs,
damages, expenses (including, without limitation, reasonable attorneys’ fees and
expenses), claims and demands of any nature whatsoever suffered or incurred
by
or made against Seller and/or such other Seller Parties, arising out of or
in
any way relating to (i) any failure by Buyer to perform its obligations under
this Section 11.7, including, without limitation, in connection with COBRA,
and/or (ii) any decision by Buyer to hire or rehire, or not to hire or rehire,
any employees at the Hotel, or any action by Buyer in connection with such
decision to hire, rehire, or not to hire or rehire, including, without
limitation, any liability or obligation Seller my incur in connection with
the
WARN Act. This Section
11.7
shall
survive the Closing or earlier termination of this Agreement.
11.8 Guest
Bookings.
In
accordance with this Agreement, Buyer will honor, for its account, all transient
reservations for Guest Bookings for the Property now or hereafter existing
and
all Advance Deposits made thereunder (to the extent credited to Buyer) for
periods from and after the Closing provided such Guest Bookings and Advanced
Deposits were made or procured in accordance with the provisions of Section
8
hereof.
The provisions of this Section
11.8
shall
survive the Closing.
11.9 Indemnity.
Buyer
and Buyer’s Principals, jointly and severally, agree to indemnify, defend (with
counsel reasonably acceptable to Seller) and hold Seller and the other Seller
Parties harmless from and against any and all losses, costs, liens, claims,
liabilities or damages (including, but not limited to, reasonable attorneys’
fees and disbursements) arising from or relating to a breach of Buyer’s
obligations under Section
11
and/or
the termination by Buyer of any of the Hotel employees. Seller agrees to
indemnify, defend (with counsel reasonably acceptable to Buyer) and hold
Buyer
and the other Buyer Parties harmless from and against any and all losses,
costs,
liens, claims, liabilities or damages (including, but not limited to, reasonable
attorneys’ fees and disbursements) arising from or relating to a breach of its
obligations under Section
11
and/or
the termination by Seller of any of the Hotel employees, except to the extent
of
the obligations of Buyer pursuant Section 11.7). This Section
11.9
shall
survive the Closing or termination of this Agreement.
31
11.10 Antitrust
Notification.
If
applicable, Buyer and Seller shall, promptly following the execution of this
Agreement, file with the appropriate governmental agencies the notification
and
report form required for the transactions contemplated hereby, and any
supplemental information which may be reasonably requested in connection
therewith, pursuant to the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of
1976,
as amended and the rules and regulations promulgated thereunder.
Section
12. Post-Closing
Access to Records. After the Closing, upon reasonable written notice, Buyer
will
make available to Seller and its representatives during normal business hours
any of its books, contracts and records relating to the Hotel in connection
with
tax, personnel, litigation or other matters for any period prior to the Closing
and will permit Seller at its expense to make copies thereof, provided, however,
that Seller will maintain the confidentiality of these documents to the extent
possible in the context of the proceedings for which the documents are required.
The provisions of this Section 12 shall survive the Closing.
Section
13. Seller’s
Disclaimers; Buyer’s Indemnification.
13.1 Seller’s
Disclaimers; Condition of Property.
(a)
Buyer acknowledges that it has had full opportunity to inspect the Property
and
review such documents and records as it deems necessary or appropriate
concerning the Property, including, without limitation, the condition of
the
soil, subsoil, surface or other physical condition of the Property; the
existence or nonexistence of hazardous or toxic materials, wastes or substances;
archeological matters; the fitness or suitability of the Property for
any particular
use or purpose; applicable restrictive covenants, governmental laws, rules,
regulations, and limitations; the zoning, subdivision, use, density, location
or
development of the Property; the necessity or availability or unavailability
of
any rezoning, zoning variances, conditional use permits, special management
area
permits, building permits, time sharing or vacation ownership approvals,
environmental impact statements, certificates of occupancy and other
governmental permits, approvals or acts; the physical condition of the Property,
including, without limitation, the structural elements, foundation, roof,
appurtenances, access, landscaping, whirlpool spa (if any), swimming pool
(if
any) and other recreational equipment (if any), and the electrical, mechanical,
HVAC, plumbing, sewage and utility systems, facilities and appliances (if
any);
the Property’s compliance or non-compliance with any building code, OSHA,
Americans with Disabilities Act, as amended, and other laws, statutes,
regulations or ordinances; the size, dimension, or topography of the Property;
any surface, soil, geologic, drainage, flooding or groundwater conditions
or
other physical conditions and characteristics of or affecting the Property
or
adjoining land, such as aircraft overflight, traffic, drainage, flooding,
air,
hazardous swimming conditions (if any), and its investment value or resale
value. Except for the express representations, warranties, covenants of Seller
contained in this Agreement upon which Buyer is expressly permitted to rely,
the
Property is being sold “AS
IS”
as of
the Closing Date. Neither
Seller’s Manager, employees, agents, nor any other person is authorized to make
any representations about the state, condition or use of the Property, and
any
such statements are not to be attributed to Seller. Buyer acknowledges that
neither Seller, Seller’s Manager, nor any of its or their agents or
representatives has made any representations or held out any inducements
to
Buyer, except as expressly provided in this Agreement, and Seller hereby
specifically disclaims any representation, oral or written, past, present
or
future, other than those specifically set forth herein.
32
(a) Without
limiting the generality of the foregoing, Buyer acknowledges and agrees that
Buyer has not relied on any representations or warranties, and neither Seller
nor Seller’s Managers, nor any of its or their agents or representatives has or
is willing to make any representations or warranties, express or implied,
other
than as may be expressly set forth herein, as to (i) the status of title
to the
Property, (ii) the actual or projected income or operating expenses of the
Property, (iii) the Contracts, (iv) the Leases, (v) the current or future
real
estate tax liability, assessment or valuation of the Property; (vi) the
potential qualification of the Property for any and all benefits conferred
by
any Legal Requirements whether for subsidies, special real estate tax treatment,
insurance, mortgages or any other benefits, whether similar or dissimilar
to
those enumerated; (vii) the compliance of the Property in its current or
any
future state with applicable Legal Requirements or any violations thereof,
including, without limitation, those relating to access for the handicapped,
environmental or zoning matters, and the ability to obtain a change in the
zoning or a variance in respect to the Property’ non-compliance, if any, with
zoning laws; (viii) the nature and extent of any right-of-way, lease,
possession, lien, encumbrance, license, reservation, condition or otherwise;
(ix) the availability of any financing for the purchase, alteration,
rehabilitation or operation of the Property from any source, including, without
limitation, any government authority or any lender; (x) the current or future
use of the Property, including, without limitation, the Property’ use for hotel,
catering and/or restaurant purposes; (xi) the present and future condition
and
operating state of any Personal Property and the present or future structural
and physical condition of the improvements, their suitability for rehabilitation
or renovation, or the need for expenditures for capital improvements, repairs
or
replacements thereto; or (xii) the status of the market for hotel, catering
and/or restaurant facilities in the area in which the Property is located.
Buyer
acknowledges and agrees that (i) the Property Information delivered or made
available to Buyer by Seller or any of its agents or representatives may
have
been prepared by third parties and may not be the work product of Seller;
(ii)
Seller has not made any independent investigation or verification of, or
has any
knowledge of, the accuracy or completeness of, the Property Information;
(iii)
the Property Information delivered or made available to Buyer and Buyer’s
representatives is furnished to each of them at the request, and for the
convenience of, Buyer; (iv) except for Seller’s representations and warranties
set forth herein, Buyer is relying solely on its own investigations,
examinations and inspections of the Property and those of Buyer’s
representatives; (v) except as may be expressly set forth to the contrary
in
this Agreement, Seller expressly disclaims any representations or warranties
with respect to the accuracy or completeness of the Property Information
and
Buyer releases Seller and Seller’s agents and representatives, from any and all
liability with respect thereto
(b) The
provisions of this Section
13.1
shall
survive the Closing.
13.2 Buyer’s
Indemnification.
Buyer
and Buyer’s Principals, jointly and severally, shall indemnify and defend (with
counsel reasonably acceptable to Seller) and hold Seller and the other Seller
Parties harmless from and against any and all claims, demands, causes of
action,
liability, damages, losses, fines, penalties, taxes, costs or expenses
(including, without limitation, reasonable attorneys’ fees) which, whether
insured against or not, may be asserted against, reasonably incurred by or
paid
by Seller and/or the other Seller Parties in connection with, by reason of,
or
arising out of (1) any transaction, contract, act, activity, event or occurrence
relating to the Property or its use or operation, occurring, accruing or
entered
into after the Closing Date and/or (2) any item, obligation, matter or agreement
which this Agreement expressly provides shall be assumed by Buyer or accepted
or
taken “subject to” by Buyer, and/or (3) any act or negligence by Buyer or any of
the Buyer Parties at or respecting the Property, whether occurring or accruing
prior to, on or after the Closing Date. In the event that Seller and/or any
of
the other Seller Parties shall be entitled to indemnification pursuant to
the
provisions of this Section
13.2,
such
indemnification shall be in addition to and not in lieu of any other remedies
Seller may have at law or equity. The provisions of this Section
13.2
shall
survive the Closing.
33
13.3 Seller’s
Indemnification.
Subject
to the disclaimers and provisions set forth in Section
13.1,
Seller
shall indemnify and defend (with counsel reasonably acceptable to Buyer)
hold
Buyer and the other Buyer Parties harmless from and against any and all claims,
demands, causes of action, liability, damages, losses, fines, penalties,
taxes,
costs or expenses (including, without limitation, reasonable attorneys’ fees)
which, whether insured against or not, may be asserted against, reasonably
incurred by or paid by Buyer and/or the other Buyer Parties in connection
with,
by reason of, or arising out of any transaction, contract, act, activity,
event
or occurrence relating to the Property or its use or operation, occurring
or
entered into only during the period of Seller’s ownership of the Property prior
to the Closing Date, and specifically excluding (x) any obligation, matter,
claim, thing, agreement or liability to be assumed by Buyer pursuant to this
Agreement or subject to which Buyer shall purchase the Property pursuant
to this
Agreement, (y) any obligation or liability of any Tenant under any of the
Leases
and/or (z) any act or negligence by Buyer or any of the Buyer Parties at
or
respecting the Property, whether occurring or accruing prior to, on or after
the
Closing Date. In the event that Buyer and/or any of the other Buyer Parties
shall be entitled to indemnification pursuant to the provisions of this
Section
13.3,
such
indemnification shall be in addition to and not in lieu of any other remedies
Buyer may have at law or equity. The provisions of this Section
13.3
shall
survive the Closing.
Section
14. Default
and Remedies.
14.1 Events
of
Default.
Any of
the following shall constitute an “Event
of
Default”
under
this Agreement:
(a) Buyer
shall fail to pay or deposit with Seller the monies representing the Fund,
the
Additional Contract Deposit, or the Purchase Price Balance when due under
this
Agreement; or Buyer shall fail to pay or deposit with Seller any other sum
of
money
when due if same is due on the Closing Date under this Agreement; or
Buyer
shall fail to pay or deposit with Seller the any other sum of
money
within two (2) Business Days after the date due under this
Agreement;
(b) Tenant
under the Operating Lease shall default under the Operating Lease beyond
the
applicable notice and cure period, if any; or there shall occur any of the
events described in Section 9.01 of the Operating Lease; or
(c)
Seller
or
Buyer shall, fail to observe or perform, in a material manner, any other
material term or provision to be observed or performed by such party under
this
Agreement and such default shall not be cured by the first to occur of the
following dates: (i) five (5) days after written notice is received by the
defaulting party informing such party of the default, or within such longer
period of time as may be reasonably necessary to cure such default provided
that
the defaulting party has taken steps in good faith within such period to
remedy
such default and is continuing to so act with diligence and continuity, or
(ii)
the Scheduled Closing Date, as such Scheduled Closing Date may be adjourned
by
the defaulting party in accordance with the provisions of this Agreement;
provided, however, that if Seller or Buyer shall fail to observe or perform
any
term or provision to be observed or performed by such party under this Agreement
on any date as to which this Agreement expressly provides that time is of
the
essence as against such party in respect of such observance or performance,
then
it shall be an Event of Default as respects such party if such party fails
to
observe or perform such term or provision to be observed or performed by
such
party on the date as to which time is of the essence as against such party.
14.2 Remedies
of Buyer.
(a) If
any
Event of Default shall occur with respect to Seller and Buyer is not in default
under this Agreement on or prior to the Closing, then Buyer’s sole and exclusive
remedy shall be, and Buyer shall be entitled, to either (a) receive a refund
of
the Contract Deposit, upon which refund this Agreement shall thereupon be
terminated and become void and of no further effect, and neither party hereto
shall have any obligations of any nature to the other hereunder or by reason
hereof, except for those obligations and liabilities that are expressly stated
to survive termination of this Agreement, or (b) seek specific performance
of
Seller’s obligations hereunder, provided that any such action for specific
performance must be commenced within thirty (30) days after such default;
provided that such specific performance shall be limited to the right to
compel
Seller to convey to Buyer such title as Seller is able to convey without
incurring any material expense to cure any Title Objections, or any other
defect
in (1) title (except for Seller’s obligations to cure certain liens pursuant to
Section
6.2(b))
or (2)
any other matter in respect of the Property or this Agreement; but Buyer
shall
not be entitled to avail itself of any remedy at law or equity to recover
monetary damages from Seller arising from a default or Event of Default by
Seller (and the provisions of this clause prohibiting Buyer from availing
itself
of any remedy to recover monetary damages shall survive the Closing and/or
the
termination of this Agreement). This Section
14.2
sets
forth remedies for failure to close and it not intended to apply to or limit
remedies Buyer may have with respect to indemnities specifically provided
by
Seller in this Agreement or in respect of any other obligation of Seller
which
survives Closing or termination pursuant to this Agreement; and if any Event
of
Default shall occur with respect to Seller after the Closing Date, then Buyer
may exercise all remedies available under applicable law and/or
equity.
34
(b) Anything
in this Agreement to the contrary notwithstanding (including, without
limitation, the immediately preceding Section
14.(a))
if, (1)
at or prior to the Closing, Buyer discovers (or by use of due diligence in
reviewing the Property and the transaction would have discovered) or is given
written notice by Seller of an occurrence, condition or fact which would
constitute a material breach of a representation or warranty on the part
of
Seller hereunder, or that such representation or warranty otherwise is
materially untrue or incorrect and (2) such material breach or material untruth
or incorrectness of such representation or warranty, by the express terms
of
this Agreement, entitles Buyer to terminate this Agreement, then, in such
event,
the sole remedy of Buyer shall be to either (a) receive a refund of the Contract
Deposit, upon which refund this Agreement shall thereupon be terminated and
become void and of no further effect, and neither party hereto shall have
any
obligations of any nature to the other hereunder or by reason hereof, except
for
those obligations and liabilities that are expressly stated to survive
termination of this Agreement, or (b) complete the purchase (with no reduction
in or abatement of the Purchase Price and no liability on the part of Seller
in
respect of such breach, untruth or incorrectness of such representations
and
warranties); and if Buyer shall so complete the purchase then Buyer irrevocably
shall be deemed to have waived any and all claims, remedies, actions and/or
suits against Seller by reason of the breach of or untruth or incorrectness
of
such representations and warranties (and this waiver by Buyer shall survive
the
Closing); provided, however, if, and only if, Seller shall have intentionally,
willfully and knowingly breached a warranty or representation on the part
of
Seller hereunder with the intent and purpose of avoiding its obligations
under
this Agreement, then Buyer shall be entitled to the remedy provided to Buyer
under the first sentence of Section
14.2(a)
hereof.
14.3 Seller’s
Remedy.
If any
Event of Default shall occur with respect to Buyer prior to the Closing and
Seller is not in default under this Agreement, then Seller shall be entitled
to
receive the Contract Deposit and the Fund Improvements, as liquidated damages,
as Seller’s sole and exclusive remedy for any default, and this Agreement shall
thereupon be terminated and become void and of no further effect, and neither
party hereto shall have any obligations of any nature to the other hereunder
or
by reason hereof, except for those obligations and liabilities that are
expressly stated to survive termination of this Agreement. Buyer acknowledges
that the aggregate of the Contract Deposit and the value of the Fund
Improvements represents a reasonable estimate of Seller’s damages. The parties
agree that it would be impractical and extremely difficult to fix actual
damages
suffered by Seller as a result of Buyer’s failure to complete the purchase of
the Property pursuant to this Agreement, and that under the circumstances
existing as of the date of this Agreement, the liquidated damages provided
for
in this Section
14.3
represent a reasonable estimate of the damages which Seller will incur as
a
result of such failure. This Section
14.3
sets
forth remedies for failure to close and it not intended to apply to or limit
remedies Seller may have with respect to indemnities specifically provided
by
Buyer and/or the Buyer Principals in this Agreement or in respect of any
other
obligation of Buyer and/or the Buyer Principals which survives Closing or
termination pursuant to this Agreement; and if any Event of Default shall
occur
with respect to Buyer after the Closing Date, then Seller may exercise all
remedies available under applicable law and/or equity.
35
Section
15. ISRA.
15.1 As
an
additional condition precedent to Seller’s obligation to sell the Property
pursuant to this Agreement, Seller shall have received from the Industrial
Site
Evaluation Element or its successor, of the New Jersey Department of
Environmental Protection or its successor (“NJDEP”),
no
later than the Scheduled Closing Date, either: (a) a non-applicability letter;
(b) a de minimus quantity exemption; (c) approval of Seller’s negative
declaration; or (d) approval of Seller’s remedial action work plan (any of the
foregoing, an “ISRA
Compliance Instrument”);
for
any one or more of which Seller (at Seller’s sole discretion) shall promptly
apply pursuant to the Industrial Site Recovery Act, N.J.S.A. 13:1K-6
et seq.,
the
regulations promulgated thereunder and any amending or successor legislation
and
regulations (“ISRA”).
If
none of the four conditions are met by the date set forth above, or if Seller
determines prior to the closing of title that the cost of compliance with
the
provisions of this Section, including without limitation the cost of any
sampling, analysis, remediation and professional fees, shall exceed the sum
of
Five Thousand Dollars ($5,000.00) or be reasonably expected to exceed that
sum,
then Seller may terminate this Agreement on notice to Buyer, in which event
the
Contract Deposit shall be promptly refunded to Buyer and this Agreement shall
thereupon be deemed terminated and become void and of no further effect,
and
neither party hereto shall have any obligations of any nature to the other
hereunder or by reason hereof, except for those provisions that expressly
survive such termination. Anything in this Agreement to the contrary
notwithstanding, Seller shall have no obligation to incur any expense, liability
or obligation in excess of Five Thousand Dollars ($5,000.00) in the aggregate
to
obtain a “letter of non-applicability, a de minimus quantity exemption, or a no
further action letter, or to obtain approval of Seller’s negative declaration,
or otherwise to comply with the requirements of ISRA and/or obtain an ISRA
Compliance Instrument (it being agreed that Seller’s failure to obtain an ISRA
Compliance Instrument shall not be a default by Seller under this Agreement),
and Seller shall have no obligation to close title or to convey the Premises
in
violation of any of the requirements of ISRA).
Section
16. Miscellaneous
Provisions.
16.1 Attorney’s
Fees.
In any
action to enforce the provisions of this Agreement, the prevailing party
will be
entitled to payment by the non-prevailing party of its reasonable attorneys’
fees and expenses; and this provision shall survive termination of this
Agreement and/or the Closing.
16.2 No
Waiver.
No
failure by Buyer or Seller to insist upon strict performance by the other
party
of any of the terms and provisions of this Agreement shall constitute or
be
deemed to be a waiver of any such term or provision, or constitute an amendment
or waiver of any such term or provision by course of performance, and Buyer
or
Seller, notwithstanding any such failure to insist upon strict performance,
shall have the right thereafter to insist upon the strict performance by
the
other party of any and all the terms and provisions of this Agreement. Buyer
or
Seller may in its sole and absolute discretion waive only in writing any
condition set forth in this Agreement which is for such waiving party’s sole
benefit, in which event the other party shall be obligated to close the purchase
of the Property upon all of the remaining terms of this Agreement.
36
16.3 Survival
of Terms.
Only
those agreements and obligations of the parties set forth in this Agreement
that
are expressly stated to survive the Closing shall continue thereafter to
be
binding upon and inure to the benefit of the parties hereto, and their
respective successors and permitted assigns.
16.4 Risk
of
Loss/Eminent Domain.
(a) If,
prior
to the Closing, a Non-Material Taking (as hereinafter defined) occurs, then
(i)
Seller shall notify Buyer of such fact, (ii) Buyer shall not have any right
or
option to terminate this Agreement and this Agreement shall continue in effect,
(iii) at the Closing, Buyer shall accept the Property subject to such
Non-Material Taking or so much of the Property as remains after such
Non-Material Taking, as the case may be, with no abatement of the Purchase
Price, and (iv) at the Closing, Seller shall assign and turn over to Buyer,
and
Buyer shall be entitled to receive and keep, all of Seller’s interest in and to
all awards for such Non-Material Taking. If, prior to the Closing Date, a
Material Taking (as hereinafter defined) occurs, then (a) Seller shall notify
Buyer of such fact and (b) either party shall have the right to terminate
this
Agreement by delivering notice of such termination to the other party on
or
before the earlier of the Closing Date or the date thirty (30) days after
Buyer
receives such notice from Seller. If a party fails to exercise such termination
right within such thirty (30) day (or shorter) period, such party shall be
deemed to have waived such termination right, in which event (x) such party
shall not have any right or option to terminate this Agreement due to such
Material Taking and this Agreement shall continue in effect (unless the other
party has exercised its termination right in a due and timely manner), (y)
at
the Closing, Buyer shall accept the Property subject to such Material Taking
or
so much of the Property as remains after such Material Taking, as the case
may
be, with no abatement of the Purchase Price, and (z) at the Closing, Seller
shall assign and turn over to Buyer, and Buyer shall be entitled to receive
and
keep, all of Seller’s interest in and to all awards for such Material Taking. In
the event that a party delivers a notice of termination within such ten (10)
day
(or shorter) period, the Contract Deposit shall be promptly refunded to Buyer
and this Agreement shall thereupon be deemed terminated and become void and
of
no further effect, and neither party hereto shall have any obligations of
any
nature to the other hereunder or by reason hereof, except for those provisions
that expressly survive such termination. Anything herein to the contrary
notwithstanding, Seller shall be entitled to keep and retain as its sole
property the proceeds of any rent or business interruption insurance maintained
by or for Seller.
(b) If,
prior
to the Closing Date, a Non-Material Casualty (as hereinafter defined) occurs,
then (i) Seller shall notify Buyer of such fact, (ii) Buyer shall not have
any
right or option to terminate this Agreement and this Agreement shall continue
in
effect, (iii) at the Closing Buyer shall accept the Property in the then
“as is”
condition of such Property with no abatement of the Purchase Price, and (iv)
at
the Closing, Seller shall assign and turn over to Buyer all of Seller’s interest
in and to all insurance proceeds payable in connection with such Non-Material
Casualty or shall deliver to Buyer any such proceeds or awards actually
theretofore paid, in each case less any Reimbursable Amounts (as hereinafter
defined), plus the amount of any deductible. If, prior to the Closing Date,
a
Material Casualty (as hereinafter defined) occurs, then (a) Seller shall
notify
Buyer of such fact and (b) either party shall have the right to terminate
this
Agreement by delivering notice of such termination to the other party on
or
before the earlier of the Closing Date or the date thirty (30) days after
Buyer
receives such notice from Seller. If a party fails to exercise such termination
right within such thirty (30) day (or shorter) period, such party shall be
deemed to have waived such termination right, in which event (x) such party
shall not have any right or option to terminate this Agreement due to such
Material Casualty and this Agreement shall continue in effect (unless the
other
party has exercised its termination right in a due and timely manner), (y)
at
the Closing Buyer shall accept the Property in the then “as is” condition of the
Property with no abatement of the Purchase Price, and (z) at the Closing,
Seller
shall assign and turn over to Buyer all of Seller’s interest in and to all
insurance proceeds payable in connection with such Material Casualty or shall
deliver to Buyer any such proceeds or awards actually theretofore paid, in
each
case less any Reimbursable Amounts, plus the amount of any deductible. In
the
event that a party delivers a notice of termination within such thirty (30)
day
(or shorter) period, the Contract Deposit shall be promptly refunded to Buyer
and this Agreement shall thereupon be deemed terminated and become void and
of
no further effect, and neither party hereto shall have any obligations of
any
nature to the other hereunder or by reason hereof, except for those provisions
that expressly survive such termination. Anything herein to the contrary
notwithstanding, Seller shall be entitled to keep and retain as its sole
property the proceeds of any rent or business interruption insurance maintained
by or for Seller.
37
(c) Notwithstanding
anything to the contrary set forth in this Agreement, (i) Seller shall have
no
obligation to repair any damage or destruction to the Property caused by
any
Casualty or to otherwise restore the Property after any Taking, and Seller
shall
have no other obligation or liability of any kind or nature in respect of
any
Casualty or Taking affecting the Property, but (ii) Seller shall have the
right
to apply the insurance proceeds (or any portions thereof) deriving from a
Casualty, and/or the award (or any portions thereof) deriving from a Taking,
toward restoration of the Property following a Casualty or Taking, as the
case
may be, and in such event, if the Closing shall occur, Seller shall turn
over to
Buyer at the Closing the unapplied portion of such insurance proceeds and
award
(together with any insurance deductible, as above provided, and less any
Reimbursable Amounts, as above provided). In the event Seller shall apply
such
proceeds and/or award toward restoration, Seller shall have the right, without
the consent of Buyer, to utilize such proceeds and/or award to restoration
of
the Property as near as commercially reasonable and commercially practicable
(given, among other considerations, the amount of the proceeds and/or award,
property taken in a Taking, costs of restoration, commercial availability
of
materials and equipment, current building codes, currently prevailing design
fashion, currently prevailing hotel operating practices and procedures, and
similar considerations) to the condition of the Property immediately prior
to
the Casualty or the Taking; and if Seller desires to make changes to the
Property in connection with such restoration (other than such changes as
Seller
is permitted to make without Buyer’s consent), then the prior written consent of
Buyer shall be required, but Buyer shall not unreasonably withhold, delay
or
condition its consent to any such changes to the Property proposed by Seller
in
connection with the restoration following a Casualty or Taking.
(d) As
used
herein, the following terms shall have the following meanings:
(i) “Casualty”
means the destruction of all or a portion of the Property by fire or other
casualty.
(ii) “Material
Casualty” means a Casualty which would cost more than Five Hundred Thousand
Dollars ($500,000.00) to repair, as reasonably estimated by a consultant
selected by Seller which is reasonably satisfactory to Buyer.
(iii) “Material
Taking” means a Taking permanently affecting more than twenty-five percent (25%)
percent of the square footage of the Property, or permanently materially
and
adversely affecting access to the Property.
(iv) “Non-Material
Casualty” means any Casualty other than a Material Casualty.
(v) “Non-Material
Taking” means any Taking other than a Material Taking.
(vi) “Reimbursable
Amounts” amounts means amount actually and reasonably incurred or expended by or
for the account of Seller for the cost of any compliance with laws, protective
restoration or emergency repairs made by or on behalf of Seller (to the extent
Seller has not theretofore been reimbursed by its insurance carriers for
such
expenditures), and/or actually and reasonably incurred or expended by or
for the
account of Seller in connection with adjusting any insurance claim, negotiating
any award for a Taking, or otherwise obtaining any award for a Taking or
insurance proceeds for a casualty.
38
(vii) “Taking”
means any taking of any portion of the Property by condemnation or eminent
domain.
16.5 Brokerage.
Seller
and Buyer each represent to the other that no brokers are involved in the
transaction described in this Agreement and that no brokerage commissions
or
finder’s fees are or will be payable hereunder. If any claim is made by any
third-party for the payment of any commission or fee, then the party whose
acts
gave rise (or are alleged to have given rise) to such claim shall indemnify,
defend and save harmless the other party for the full amount of such claim
and
all other claims, demands, actions, losses, damages, liabilities, costs and
expenses (including reasonable attorneys’ fees) filed against or incurred by
such other party as a result of such claim; provided, however, that to the
extent Buyer is obligated to indemnify Seller hereunder, such indemnification
obligation shall be an indemnification obligation of Buyer and Buyer’s
Principals, jointly and severally. The provisions of this Section
16.5
shall
survive the Closing or termination of this Agreement.
16.6 Governing
Law.
This
Agreement shall be governed by and construed under the laws of the State
of New
Jersey. Any legal action hereunder shall be filed in the New Jersey judicial
system only, and Seller and Buyer hereby unconditionally submit themselves
to
the jurisdiction of the courts of the State of New Jersey and the United
States
District Court for the District of New Jersey.
16.7 Interpretation
of Agreement.
The
parties acknowledge that both parties have caused this Agreement to be reviewed
and approved by legal counsel of their own choice. No negotiations concerning
or
modifications made to prior drafts of this Agreement shall be construed in
any
manner to limit, reduce or impair the rights, remedies, duties and obligations
of the parties under this Agreement or to restrict or expand the meaning
of any
of the provisions of this Agreement. Ambiguities in this Agreement shall
not
be
construed against the party drafting this Agreement, notwithstanding any
contrary rule of construction or interpretation at law or in equity. This
Agreement may be executed in any number of counterparts, each of which shall,
when executed, be deemed to be an original and all of which shall be deemed
to
be one and the same instrument. This Agreement may be executed by facsimile
signatures, which shall be as binding as original signatures.
16.8 Sole
Agreement; Amendment.
This is
the sole and only agreement between the parties and any and all prior oral
or
written representations, correspondence, letters of intent and agreements
are
merged into and superseded by this Agreement and shall be of no force or
effect.
Any modifications of this Agreement must be in writing and signed by the
parties
hereto. Nothing in this provision shall waive, terminate or affect the Operating
Lease, or the references in this Agreement to the Operating Lease.
16.9 Partial
Invalidity.
If any
provision hereof is held invalid or not enforceable to its fullest extent,
such
provision shall be enforced to the extent permitted by law, and the validity
of
the remaining provisions hereof shall not be affected thereby.
16.10 No
Joint
Venture.
The
execution and performance of this Agreement, Buyer’s and Seller’s review and
approval rights (if any) described in this Agreement, the agreements of the
parties in this Agreement and the exercise of any rights hereunder, are not
intended, and shall not be construed, to create a partnership, joint venture
or
co-tenancy between Seller and Buyer. Furthermore, the execution of this
Agreement by Buyer and Seller shall not create (and neither Buyer nor Seller
intends to create) any relationship of principal and agent between Buyer
and
Seller, or any partnership or joint venture relationship between Buyer and
Seller. Neither Buyer nor Seller shall be deemed to be a fiduciary of the
other
party.
39
16.11 Assignment.
Neither
this Agreement nor any of the rights of Buyer hereunder may be assigned or
transferred by Buyer without Seller's prior written consent, which consent
may
be granted or withheld in Seller’s sole discretion, and any purported assignment
or encumbrance without Seller's prior written consent shall be null and void,
and shall constitute a default hereunder, which is not capable of being cured.
Any change in ownership or control (“control” meaning the possession of the
power to direct or cause the direction of the management and policies of
the
entity in question) of Buyer or of any of the direct or indirect ownership
interests in Buyer, at any level or tier of ownership, whether in one
transaction or a series of transactions, between the Effective Date and the
Closing, shall constitute an assignment for purposes of this provision. Buyer
represents that on the date hereof (i) the ultimate owners of Buyer are Xxxxx
Xxxxx, an individual, and Xxxxxx Xxxxxxx, an individual, and respectively
owning, directly, seventy-five percent (75%) and twenty-five percent (25%)
of
the ultimate equity interests in Buyer and (ii) Xxxxx Xxxxx and Xxxxxx Xxxxxxx.
have the right to and actually do exercise control of Buyer. Buyer shall
not
resell the Property or any part thereof through a “double escrow” or other
similar procedure without Seller’s prior consent, which consent may be granted
or withheld in Seller’s sole discretion. At the Closing Buyer shall provide to
Seller evidence reasonably satisfactory to Seller substantiating the
then-current ownership and control (including without limitation, direct,
indirect, and ultimate ownership and control) of the buyer (the “Ownership
Evidence”).
16.12 Waiver
of Trial by Jury. THE PARTIES HERETO EXPRESSLY WAIVE THE RIGHT TO TRIAL BY
JURY
IN ANY ACTION OR PROCEEDING ARISING OUT OF, OR RELATING TO, THIS AGREEMENT
AND/OR THE TRANSACTIONS CONTEMPLATED HEREUNDER.
16.13 Exhibits.
The
following Annex, Schedules and Exhibits are attached to this Agreement and
incorporated by reference herein:
|
Annex
A
|
Definitions
|
|
|
Schedule
A
|
intentionally
omitted
|
|
|
Schedule
B
|
Land
Description
|
|
|
Schedule
C
|
Service
Contract Schedule
|
|
|
Schedule
D
|
Certain
Permitted Exceptions
|
|
|
Schedule
E
|
List
of Property Reports provided to Buyer
|
|
|
Schedule
F
|
Occupancy
Agreement Schedule
|
|
|
Schedule
G
|
intentionally
omitted
|
|
|
Schedule
H
|
Disclosed
Litigation
|
|
|
Schedule
I
|
intentionally
omitted
|
|
40
|
Exhibit
A
|
intentionally
omitted
|
|
|
Exhibit
B
|
Bargain
and Sale Deed
With Covenants Against Grantor’s Acts
|
|
|
Exhibit
C
|
Xxxx
of Sale
|
|
|
Exhibit
D
|
Assignment
and Assumption of Leases
|
|
|
Exhibit
E
|
Assignment
and Assumption of Contracts
|
|
|
Exhibit
F
|
Affidavit
of Title
|
|
|
Exhibit
G
|
Assignment
and Assumption of Permits
|
|
16.14 Notices.
All
notices, requests, demands or documents which are required or permitted
to be
given or served hereunder shall be in writing and (i) personally delivered,
(ii)
sent by facsimile transmission (with received confirmation no later than
5:00
p.m. New York City Time on the day sent), (iii) sent by overnight courier,
or
(iv) sent by registered or certified mail, postage prepaid; in all events,
addressed as follows:
|
To
Seller:
|
WO
GRAND HOTEL, LLC
c/o
Wilshire Enterprises, Inc.
Xxx
Xxxxxxx Xxxxxx
00xx
Xxxxx
Xxxxxx,
Xxx Xxxxxx 00000
Phone:
(000) 000-0000
Fax:
(000) 000-0000
Attention:
Xxx Xxxxx, President
|
|
|
with
a copy to:
|
Xxxxxxx,
Xxxxxxxxx LLP
000
Xxxxxxxx Xxxxxx
Xxxxxxxxx,
Xxx Xxxxxx 00000
Phone:
(000) 000-0000
Fax:
(000) 000 0000
Attention:
Xxxx X. Xxxxxxxx, Esq.
|
|
|
To
Buyer:
|
000
XXXXXXXX XXXXXX HOTEL ASSOCIATES, L.L.C.
000
X.X. Xxxxx 00, Xxxxx 00
Xxxx,
Xxx Xxxxxx 00000
Phone:
(000) 000 0000
Fax:
(000) 000 0000
Attention:
Mr. Xxxxx Xxxxx
|
|
|
with
a copy to:
|
Xxxxxxxxx
Xxxxx Xxxxx & Xxxxxx, LLC
000
Xxxxxxxxx Xxxxx, Xxxxx 000
Xxxx
Xxxxxx, XX 00000
Phone:
(000) 000-0000
(000)
000-0000
Attention:
Xxxxx Xxxxx, Esq.
|
|
41
Such
addresses and facsimile numbers may be changed from time to time by the
addressee by serving notice as heretofore provided. Service of such notice
or
demand shall be deemed complete on the date of actual delivery as shown
by the
addressee’s registry or certification receipt or at the expiration of the third
day after the date of mailing (whether or not actually received by the
addressee), or on the date of facsimile transmission by telecopier with
confirmation receipt, whichever is earliest in time. Anything herein to
the
contrary notwithstanding, if pursuant to this Section service of a notice
otherwise would be deemed complete at any time other than between the hours
of
9:00 am and 5:00 pm (New York City time) on a Business Day, then such service
of
such notice shall be deemed complete on the next occurring Business
Day.
16.15 Headings
of Sections.
The
headings of sections and subsections herein are inserted only for convenience
and reference and shall in no way define, limit or describe the scope or
intent
of any provision of this Agreement.
16.16 References
to Calendar Days.
Except
as expressly provided herein to the contrary, all references to “days” in
determining the time for performance shall mean calendar days.
16.17 Other
Parties.
Nothing
in this Agreement shall be construed as giving any person, firm, corporation
or
other entity, other than the parties hereto, their successors and permitted
assigns, any right, remedy or claim under or in respect of this Agreement
or any
provision hereof.
16.18 Confidentiality.
Buyer
and Seller each agrees to maintain the confidentiality, other than to its
affiliates, officers, employees, advisors, agents, joint venturers, lenders,
attorneys and consultants or as required by law, rule or regulation, of
(i) all
information that is provided by or for the other party that is not public
information, (ii) the fact the Buyer has made this offer and the terms
and
conditions of this offer and (iii) the results of the inspections that
are done
at the Property. Notwithstanding the foregoing, Buyer or Seller, as the
case may
be, may disclose such of the information as required pursuant to a subpoena
or
order issued by a court of competent jurisdiction, or by a judicial or
administrative or legislative body or committee or as otherwise may be
required
by law, rule or regulation and such determination is made on the advice
of
counsel. If Buyer or Seller, as the case may be, receives a request to
disclose
any information under such subpoena or order, Buyer or Seller, as the case
may
be, will, if permitted by such subpoena or order: (a) promptly notify the
other
party, and (b) if disclosure is required or deemed by Buyer or Seller,
as the
case may be, advisable (acting on advice of counsel), cooperate with the
other
party to obtain an order or other reliable assurance that confidential
treatment
will be accorded designated portions of the information. Each of Buyer
and
Seller acknowledges that this provision to maintain confidentiality is
an
essential inducement for the other party to enter this Agreement. Following
the
Closing, (i) Seller shall be permitted to issue press releases and make
other
public announcement regarding the acquisition of the Hotel by Buyer and
(ii)
Buyer shall be permitted to issue press releases and make other public
announcements regarding the acquisition of the Hotel by Buyer, but such
press
releases by Buyer shall not disclose the purchase price or other terms
or
conditions of the acquisition, and otherwise shall be subject to the prior
written approval of Seller, not to be unreasonably withheld, delayed or
conditioned; in addition, no press release by Buyer shall name or otherwise
identify any of Buyer’s Principals if such Buyer’s Principal is at such time
under indictment or the subject of a criminal investigation or other criminal
proceeding. If a party shall breach its obligations under this Section
16.18,
then
the party who is in breach shall indemnify, defend and save harmless the
other
party for the full amount of all claims demands, actions, losses, damages,
liabilities, costs and expenses (including reasonable attorneys’ fees) filed
against or incurred by the non-breaching party; provided, however, that
to the
extent Buyer is obligated to indemnify, defend and hold harmless Seller
hereunder, such obligation shall be an obligation of Buyer and Buyer’s
Principals, jointly and severally. The provisions of this Section
16.18
shall
survive Closing or earlier termination of this Agreement.
42
16.19 Interpretation;
Joint and Several Liability.
The
term “Seller,” whenever used in this Agreement, will include Seller and its
successors. The term “Buyer” will include Buyer and Buyer’s successors and
permitted assigns, and as the context requires, the plural. If there is
more
than one person who is “Buyer” under this Agreement, then each person will be
jointly and severally liable for all of the obligations of Buyer under
this
Agreement.
16.20 1099-S.
Provided that Seller shall deliver the signed 1099-S form at closing, Buyer
hereby agrees that Buyer shall and hereby does assume all responsibility
for
compliance with the transaction reporting requirements of the 1986 Federal
Tax
Reform Act (and this obligation shall survive the Closing).
16.21 Refund
of
Contract Deposit. Notwithstanding anything to the contrary in this Agreement,
at
law and/or in equity, in any instance in which, pursuant to this Agreement,
Buyer shall be entitled to a refund of or return of the Contract Deposit,
such
right of Buyer to such refund or return shall be subject to the prior full
payment, satisfaction and performance of any and all indemnity and/or other
obligations of Buyer to Seller pursuant to this Agreement and the full
payment,
satisfaction and performance of any and all indemnity and/or other obligations
of the tenant pursuant to the Operating Lease.
16.22 Knowledge.
As used
in this Agreement, the words “to Seller’s knowledge,” to “Seller’s actual
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 Xxx Xxxxx. As used in this Agreement, the words “to Buyer’s
knowledge,” to “Buyer’s actual 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 Xxxxx Xxxxx and/or Xxxxxx
Xxxxxxx.
16.23 Submission
Non-Binding.
This
Agreement shall not be binding upon either party until executed by both
Buyer
and Seller. Submission of this Agreement by either party shall not bind
either
party to the terms of this Agreement as submitted until this Agreement
is fully
executed.
16.24 No
Recording.
(a) The
parties hereto agree that neither this Agreement nor any memorandum or
notice
hereof shall be recorded, and Buyer agrees not to file any lis pendens
or other
instrument against the Property in connection herewith.
(i) In
furtherance of the foregoing, Buyer acknowledges that the filing of a lis
pendens or other evidence of Buyer’s rights or the existence of this Agreement
against or encumbering the Property could cause significant monetary and
other
damages to Seller; and
(ii) In
furtherance of the foregoing, Buyer and Buyer’s Principals, jointly and
severally, hereby indemnify and hold harmless Seller from and against any
and
all liabilities, damages, losses, costs or expenses (including, without
limitation, reasonable attorneys’ fees and costs incurred in the enforcement of
the foregoing indemnification obligation) arising out of the breach by
Buyer of
any of Buyer’s obligations under this Section 16.24(a).
(iii) Notwithstanding
the provisions of Section 16.24(a)(i) above, Buyer shall have the right
to file
a lis pendens against the Property solely under circumstances under which
Buyer
is seeking specific performance of Seller’s obligations hereunder, provided (A)
Buyer files such claim within thirty (30) days after the earlier of (x)
the date
on which Seller terminates this Agreement or Buyer alleges that Seller
has
defaulted hereunder or (y) the scheduled Closing Date and (B) if it is
ultimately determined by a court order that Buyer was not entitled to specific
performance under this Agreement, Buyer and Buyer’s Principals, jointly and
severally, shall, and hereby do, indemnify and hold harmless Seller (and
each
Seller Party) from and against any and all liabilities, damages, losses,
costs
or expenses (including, without limitation, reasonable attorneys’ fees and costs
incurred in the enforcement of the foregoing indemnification obligation)
arising
out of the filing of such lis pendens by Buyer (including, without limitation,
consequential damages incurred by Seller as a result thereof).
43
(b) The
provisions of this Section
16.24
shall
survive the termination of this Agreement.
16.25 Further
Assurance.
The
parties, from time to time, after the Closing Date, shall do such things
and
execute and deliver any instruments, agreements or other documents reasonably
requested by the other which are necessary or convenient in order to evidence
or
confirm any of the agreements of the parties hereunder or to effectuate
any of
the provisions of this Agreement; provided that in connection therewith
a party
shall not be obligated to incur any expense, cost, liability or obligation,
or
to waive or release any right or privilege. This provision shall survive
the
Closing.
16.26 Buyer’s
Principals. At the option of Seller, notwithstanding that this Agreement
and/or
the Lease has been executed and delivered by Buyer and Seller, Seller may
cancel
and terminate this Agreement and the Lease at any time unless and until
Buyer’s
Principals have executed this Agreement as set forth below and have executed
the
guaranty of the Lease, and have delivered such executed instruments to
Seller.
16.27 Seller’s
Rights to Commence or Maintain Litigation. Anything in this Agreement to
the
contrary notwithstanding, if Seller (a) is obligated to indemnify Buyer
(or any
other person) under this Agreement, pursuant all Section 7.1(a)(ii) or
otherwise
or (b) is entitled to any portion of any rent or additional rent or other
amount
owed by any tenant under a Lease, Seller (before and/or after the Closing)
reserves the right to commence and/or continue any and all appropriate
legal
proceedings to defend and/or prosecute any claims, actions and/or suits
(including, without limitation, to defend any claims or other matters respecting
which Seller is obligated to indemnify Buyer and/or any other person, and/or,
as
the case may be, to collect amounts claimed to be due Seller), and Buyer
agrees
to cooperate with Seller, at Seller’s sole (but reasonable) cost and expense, in
connection with such proceedings, actions and suits, provided, that, if
under
applicable law it is necessary to use Buyer’s name in order to commence or
maintain any such proceedings, actions or suits, Buyer shall, at Seller’s
request and sole (but reasonable) cost and expense, commence and maintain
such
proceedings, actions and suits at the direction of Seller and shall otherwise
freely cooperate with Seller in connection therewith. In addition, if in
accordance with the provisions of this Agreement, if Buyer shall commence
any
legal action to collect any amounts due from a tenant under a Lease and
such
tenant shall also owe amounts which Seller shall be entitled to receive
pursuant
to the provisions of this Agreement, then, at Seller’s option, Buyer shall
include in Buyer’s legal action the claim for amounts due to Seller, and Seller
shall reimburse Buyer for a portion of the reasonable and actual out-of-pocket
legal fees and disbursements incurred by Buyer in prosecuting such action
in an
amount equal to the total amount of such fees and disbursements multiplied
by a
fraction, the numerator of which is the total amount realized by Seller
in such
action and the denominator of which is the total amount realized by Seller
and
Buyer in such action. This provision shall survive the Closing.
16.28 Agreement
subject to Xxxxx Inc. Report.
(a) Buyer
acknowledges, that, with the consent of Buyer’s Principals, Seller has requested
that Xxxxx Inc. or an affiliate of Xxxxx Inc. conduct background investigations
concerning Buyer’s Principals and provide reports of such investigations
(“Kroll
Reports”).
44
(b) In
the
event that any of the Kroll Reports include any information concerning
any of
Buyer’s Principals that Seller, in Seller’s reasonable judgment, deems of such
nature that Seller’s reputation could be adversely affected by engaging in a
transaction with any of Buyer’s Principals or otherwise being associated with
any of Buyer’s Principals, then Seller shall have the right to terminate this
Agreement by notice to Buyer, in which event (provided that Buyer shall
not be
in default under this Agreement) the Contract Deposit shall be promptly
refunded
to Buyer and this Agreement shall thereupon be deemed terminated and become
void
and of no further effect, and neither party hereto shall have any obligations
of
any nature to the other hereunder or by reason hereof, except for those
provisions that expressly survive such termination; provided, however,
that
Seller must give notice to Buyer exercising its rights under this subsection
(b)
to terminate this Agreement under this Section 16.28 not later than the
date ten
(10) days after receipt by Seller of the last of the Kroll Reports concerning
Buyer’s Principals to be received by Seller. Seller agrees that promptly upon
receipt by Seller of a Kroll Report concerning a Buyer’s Principal, Seller shall
send a copy of such report to such Buyer’s Principal.
[SIGNATURE
PAGE TO FOLLOW]
45
|
SELLER:
|
BUYER:
|
|||
|
WO
GRAND HOTEL, LLC
|
000
XXXXXXXX XXXXXX HOTEL ASSOCIATES, L.L.C.
|
|||
|
|
||||
| By | WILSHIRE ENTERPRISES, INC., | |||
|
Managing
Member
|
By | _______________________ | ||
|
Name:_______________
|
||||
| Title: Managing Member | ||||
|
By
|
||||
|
Xxxxxx
X. Xxxxx, President
|
||||
The
undersigned have signed this document personally to confirm their agreement
to
the provisions of Section
3.3,
Section
3.4,
Section
5.1(c),
Section
8.5,
Section
8.6,
Section
9.4(b),
Section
10.1,
Section
11.4,
Section
11.5,
Section
11.6,
Section
11.7,
Section
11.9,
Section
13.2,
Section
16.5,
Section
16.18,
and
Section
16.24,
and to
each other provision of this Agreement which provides for a liability or
obligation on the part of Buyer’s Principals. The undersigned may execute below
in counterparts and/or by facsimile signatures, which shall be as binding
as
original signatures.
_____________________
Xxxxx
Xxxxx
Date:_____________
_____________________
Xxxxxx
Xxxxxxx
Date:_____________
46
ANNEX
A
DEFINITIONS
(a) “Additional
Contract Deposit:”
shall
have the meaning set forth in Section
4.1.
(b) “Advance
Deposits:”
All
deposits under or with respect to the Leases, Guest Bookings and Occupancy
Agreements, whether in cash, by way of letter of credit or otherwise and
held as
security for the performance of the obligations of the parties to the Leases,
Guest Bookings or Occupancy Agreements.
(c) “Affidavit
of Title:”
shall
have the meaning set forth in Section
9.2.
(d) “Air
Conditioning Agreement:”
Individually and collectively, (1) Lease Agreement between WOHA and Triumphe
Leasing Network, Inc. (“Triumph”), dated December 12, 2003, (2) Lease Agreement
between WOHA and Triumphe dated December 10, 2003, and (3) Lease Agreement
between WOHA and Triumphe dated December 10, 2003, respecting the air
conditioning units specified in such agreements.
(e) “Assignment
and Assumption of Contracts:”
shall
have the meaning set forth in Section
9.2.
(f) “Assignment
and Assumption of Leases:”
shall
have the meaning set forth in Section 9.2.
(g) “Assignment
and Assumption of Ownership Interests:”
shall
have the meaning set forth in Section
9.2.
(h) “Assignment
and Assumption of Permits:”
shall
have the meaning set forth in Section 9.2.
(i) “Xxxx
of Sale:”
shall
have the meaning set forth in Section
9.2.
(j) “Business
Day:”
Any
Monday through Friday that is not a New Jersey State or Federal holiday
for
which financial institutions or post offices are generally closed in the
State
of New Jersey.
(k) “Buyer
Parties:”
shall
mean Buyer, its officers, directors, members, shareholders, owners, partners,
principals (including without limitation, Buyer’s Principals), representatives,
employees, consultants, contractors, and agents, and their respective successors
and assigns.
(l) “Buyer’s
Principals:”
shall
have the meaning set forth in Section
3.4.
(m) “Buyer’s
Operator:”
shall
have the meaning set forth in Section
11.5.
(n) “Casualty:”
shall
have the meaning set forth in Section
16.4.
(o) “Certificates:”
shall
have the meaning set forth in Section
11.4(b).
(p) “Closing:”
shall
have the meaning set forth in Section
9.1.
(q) “Closing
Adjournment Payment:”
shall
have the meaning set forth in Section
9.1.
(r)
“Closing
Date:”
shall
have the meaning set forth in Section
9.1.
(s) “Contract
Deposit:”
shall
have the meaning set forth in Section
4.1.
(t) “Conveyance
Tax Documents:”
shall
have the meaning set forth in Section
9.2.
(u) “Cut-Off
Time:”
11:59
a.m. (Eastern Standard Time) on the day prior to the Closing Date.
(v) “Deed:”
The
bargain and sale deed without covenants against grantor’s acts, pursuant to
which Seller shall to convey title to the Property to Buyer, in substantially
the form attached hereto as Exhibit
B.
(w) “Depositors:”
shall
have the meaning set forth in Section
11.3.
(x) “Environmental
Law:”
all
federal, state and local laws, statutes, ordinances and regulations, now
or
hereafter in effect, in each case as amended or supplemented from time
to time,
including, without limitation, all applicable judicial or administrative
orders,
applicable consent decrees and binding judgments relating to the regulation
and
protection of human health, safety, the environment and natural resources
(including, without limitation, ambient air, surface, water, groundwater,
wetlands, land surface or subsurface strata, wildlife, aquatic species
and
vegetation), including, without limitation, the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended (42 U.S.C.
§§ 9601
et seq.), the Hazardous Material Transportation Act, as amended (49 U.S.C.
§§
1801 et seq.), the Federal Insecticide, Fungicide, and Rodenticide Act,
as
amended (7 U.S.C. §§ 136 et seq.), the Resource Conservation and Recovery Act,
as amended (42 U.S. §§ 6901 et seq.), the Toxic Substance Control Act, as
amended (15 U.S.C. §§ 2601 et seq.), the Clean Air Act, as amended (42 U.S.C. §§
7401 et seq.), the Federal Water Pollution Control Act, as amended (33
U.S.C. §§
1251 et seq.), the Occupational Safety and Health Act, as amended (29 U.S.C.
§§
651 et seq.), the Safe Drinking Water Act, as amended (42 U.S.C. §§ 300f et
seq.), the Industrial Site Recovery Act, as amended (N.J.S.A. 13:1K-6
et seq.),
the
New Jersey Spill Compensation and Control Act, as amended (N.J.S.A. 58:10-23.11b
et seq.),
the
New Jersey Underground Storage of Hazardous Substances Act, as amended
(N.J.S.A.
58:10A-21 et seq.),
the
New Jersey Water Pollution Control Act, as amended (N.J.S.A. 58:10A-1
et seq.),
any
state or local counterpart or equivalent of any of the foregoing, and any
federal, state or local transfer of ownership notification or approval
statutes,
and all regulations and requirements promulgated in connection with any
of the
foregoing, all as same may hereafter be amended or modified.
(y) “FF&E:”
All
items of tangible personal property to the extent owned by Seller which
are
affixed to or installed in and used in connection with the Hotel, including,
without limitation, all Inventory, machinery, vehicles (if any), furniture,
furnishings, artwork (if any) and other decorative items, televisions,
radios,
VCRs (if any) and other consumer electronic equipment (if any),
telecommunications equipment (if any), computer equipment (if any), all
other
equipment, plans (if any), specifications (if any), guaranties and warranties
(if any), and supplies, marketing materials (if any).
(z) “Fund:”
Initially One Million Dollars ($1,000,000.00), to be deposited by Buyer
with
Seller as provided in this Agreement; the amount of the Fund shall be reduced
as
the Fund shall be disbursed and applied as provided in the Operating
Lease
(aa) “Fund
Account”:
shall
have meaning set forth in Section
4.1.
(bb) “Fund
Improvements”:
All
improvements made to the Property during the term of the Operating Lease
which
satisfy all of the following criteria: (i) costs of such improvements should
be
capitalized in accordance with generally accepted accounting practices,
and (ii)
the costs of such improvements are paid for out of the Fund or reimbursed
out of
the Fund pursuant to the Operating Lease.
(cc) “Governmental
Authority:”
Any
federal, state, county or other governmental department, entity, authority,
commission, board, bureau, court, agency or any instrumentality of any
of the
foregoing.
(dd) “Guest
Bookings:”
Guest
or room bookings of transient guests.
(ee) “Guest
Bookings Report:”
shall
have the meaning set forth in Section
11.8.
(ff) “Guest
Ledger:”
shall
have the meaning set forth in Section
10.1(g).
(gg) “Hazardous
Material:”
(i)
those substances currently or hereafter included within the definitions
of any
one or more of the terms “hazardous materials”, “hazardous wastes”, “hazardous
substances”, “industrial wastes”, and “toxic pollutants”, as such terms are
defined under the Environmental Laws or any other Legal Requirement, or
any of
them, (ii) petroleum and petroleum products, including, without limitation,
crude oil and any fractions thereof oil, crude oil, (iii) natural gas,
synthetic
gas and any mixtures thereof, (iv) asbestos and or any material which contains
any hydrated mineral silicate, including, without limitation, chrysotile,
amosite, crocidolite, tremolite, anthophylite and/or actinolite, whether
friable
or non-friable, (v) polychlorinated biphenyl (“PCBs”)
or
PCB-containing materials or fluids, (vi) radon and other radioactive materials,
(vii) any other hazardous or radioactive substance, material, pollutant,
contaminant or waste, (viii) any flammable or explosive materials, solid
wastes,
asbestos and asbestos-containing materials, biologically hazardous wastes,
mold,
hazardous wastes or substances or toxic wastes or substances, including,
without
limitation, (ix) any other material or substances whose use, storage, handling
or disposal is regulated by a Legal Requirement, and (x) any other substance
with respect to which any Environmental Law, other Legal Requirement or
governmental authority requires environmental investigation, monitoring
or
remediation.
(hh) “Hotel”
or “Improvements:”
All
buildings, improvements and fixture on the Land at which the hotel known
as
“Wilshire Grand Hotel” , having the address of 000 Xxxxxxxx Xxxxxx Xxx, Xxxxxxxx
of West Orange, Essex County, New Jersey, is operated (excluding, however,
any
improvements or fixtures which are (1) owned or leased by any tenants or
occupants under leases, or (2) are leased under service contracts).
(ii) “Hotel
Employees:” shall have the meaning set forth in Section 7.1.
(jj) “House
Funds:”
shall
have the meaning set forth in Section
10.1(g).
(kk) “Initial
Contract Deposit:”
shall
have the meaning set forth in Section
4.1.
(ll) “Intangible
Property:”
All
intangible property to the extent owned by Seller solely in connection
with the
management, maintenance, repair and operation of the Hotel and other Property,
including, without limitation, (i) good will, the trade name “Wilshire Grand
Hotel” (but only to the extent, if any, owned by Seller; and not including the
name “Wilshire” in connection with any other business or usage other than the
Hotel), signage and other identifying material associated with the Hotel
and
other Property, (ii) the plans and specifications and other architectural
and
engineering drawings for the Improvements, if any (to the extent freely
assignable), (iii) warranties, guaranties, and indemnities from architects,
contractors, suppliers and others, if any (to the extent freely assignable),
(iv) surveys, engineering reports and other technical information relating
to
the Real Property or Improvements, if any (to the extent freely assignable),
(v)
website programs and access and domain names including without limitation,
CAD
drawings, graphics, names, marks, artwork, concepts, designs, artwork,
and
blueprints and text, if any, to the extent the same relate solely to the
Hotel
(to the extent freely assignable),
and (vi)
other property, if any, owned by Seller relating solely to the design,
construction, ownership, use, leasing, maintenance, service, or operation
of the
Real Property or any of the items listed in this subsection, provided Intangible
Property shall not include cash, bank deposits and accounts receivable.
(mm) “Inventory:”
All
merchandise, goods, materials, supplies, inventory and other items owned
by
Seller and used solely for the operation and maintenance of guest rooms,
guest
services, restaurants, lounges, swimming pool (if any), health clubs and
spa (if
any), and other common areas and recreational areas (if any) located within
or
relating to the Improvements, including but not limited to (i) all food
and
beverage (alcoholic and non-alcoholic inventory), if any, including, without
limitation, items used for in-room service bars and mini-bars, if any,
and any
such items as may be owned by the holder of the Liquor License, if any,
specifically excluding all food and beverage (alcoholic and non-alcoholic
inventory), if any, including, without limitation, items used in-room service
bars and mini-bars and any such items as may be owned by the Restaurant
Tenant
and/or Operating Tenant; (ii) all inventory, if any, maintained in any
gift shop
or other retail store, if any located on the Real Property, except for
inventory
maintained by a tenant, (iii) office supplies and stationery; (iv) advertising
and promotional materials, if any; (v) towels, washcloths, mattresses,
pillows,
linens, blankets and bedding, if any; (vi) cleaning, paper and other supplies;
(vii) napkins and tablecloths, china, crystal, dishware, glassware, silverware,
flatware and other dinnerware, kitchen appliances, cookware and other cooking
utensils, if any, (viii) upholstery material, carpets, rugs, and furniture;
(ix)
engineers’ supplies, paint and painter’s supplies, if any; (x) employee
uniforms, if any; and (xi) all cleaning and maintenance equipment supplies
for
common areas and recreational areas, if any. The foregoing notwithstanding,
Inventory shall not include (x) any merchandise, goods, materials, supplies,
inventory and other items owned by Restaurant Tenant, Operating Tenant
or any
other tenant or (y) any alcoholic beverages or alcoholic inventory unless
it
shall be lawful for Seller to sell and transfer same to Buyer).
(nn) “ISRA:”
shall
have the meaning set forth in Section
15.1.
(oo) “ISRA
Compliance Instrument:”
shall
have the meaning set forth in Section
15.1.
(pp) “Kroll
Reports:”
shall
have the meaning set forth in Section
16.28.
(qq) “Land:”
That
certain parcel of land located in West Orange, New Jersey, as more particularly
described on Schedule
B
attached
hereto and made a part hereof, including all covenants, easements and
restrictions affecting the Land, together with all other (if any) property
rights, tenements, rights-of-way, development rights (including, without
limitation, excess floor area rights), air rights, entitlements, unused
densities, privileges and appurtenances thereto, if any; all leases, rents
and
profits derived therefrom; all right, title and interest of Seller, if
any, in
and to any land lying in the bed of any street, road, highway or avenue,
open or
proposed, public or private, in front of or adjoining all or any part of
the
Land to the centerline thereof; all right, title and interest of Seller,
if any,
in and to unpaid award of payment which may now or hereafter be payable
in
respect of any taking by condemnation of any portion of the Land or Improvements
by any Governmental Authority; and all right, title and interests of Seller,
if
any, in and to any unpaid award for damage to the Land or any part thereof
by
reason of change of grade of any street, road, highway or avenue adjacent
to the
Land; all rights, if any, to utility connections and hook-ups; and all
strips
and gores adjoining and adjacent to the Land.
(rr) “Lease
Files:” Files
for
all tenants of the Property other than the Operating Tenant, including,
without
limitation, to the extent in the possession of Seller, each Lease (other
than
the Operating Lease) and all correspondence pertaining to each Lease (other
than
the Operating Lease).
(ss) “Leases:”
The
leases, licenses to enter and use premises or occupancy agreements (other
than
the Occupancy Agreements but including the Restaurant Lease) between Seller
(or
Seller’s predecessor) or Seller’s Manager on behalf of Seller and any tenants,
licensee or occupants with respect to the Property, together with all
amendments, modifications, terminations, guaranties, certificates of occupancy,
any letter agreements, riders thereto or thereof.
(tt) “Leasing
Commission Agreement:”
All
commission, brokerage or similar agreements pertaining to the
Leases.
(uu) “Legal
Requirement.”
Any
law, enactment, statute, code, ordinance, order, rule, regulation, rule,
regulation, judgment, decree, writ, injunction, authorization, covenant,
condition, restriction or agreement, or other direction or requirement
of any
Governmental Authority, which pertains to the Property or any portion thereof
or
to the ownership, use, operation, maintenance, possession, construction,
reconstruction, repair or alteration of the Property or any portion
thereof.
(vv) “Liquor
License:”
shall
have the meaning in Section
11.5.
(ww) “Management
Agreement:” The Hotel Management Agreement dated as of June 2, 2005, between
Seller, as owner, and Horizon Hotels Limited, as operator, as manager,
as same
may have been or may be amended.
(xx) “Xxxxxxx:”
shall
mean Xxxxxxx X. Xxxxxxx, an individual, and/or any corporation, association,
partnership, limited partnership, limited liability company, joint ventures,
proprietorship or other entity that any time (i) was or is, directly or
indirectly, in whole or in part, owned by Xxxxxxx X. Xxxxxxx, and/or (ii)
was or
is, directly or indirectly, in whole or in part, controlled or operated
by
Xxxxxxx Xxxxxxx or affiliated with Xxxxxxx Xxxxxxx,
(yy) “Xxxxxxx
Rights Agreement:”
shall
mean the certain Agreement dated as of June 2, 2005, by and among Xxxxxxx
X.
Xxxxxxx, WO Grand Hotel, LLC, Proud Three, LLC and Wilshire Enterprises,
Inc.,
as same may have been or may be amended.
(zz) “Xxxxxxx
Release:”
shall
have the meaning set forth in Section
5.2.
(aaa) “Material
Casualty:”
shall
have the meaning set forth in Section
16.4.
(bbb) “Material
Taking:”
shall
have the meaning set forth in Section
16.4.
(ccc) “NJDEP:”
shall
have the meaning set forth in Section
15.4.
(ddd) “Notices
to Tenants and Service Providers:” shall have the meaning set forth in Section
9.2.
(eee) “Non-Material
Casualty:”
shall
have the meaning set forth in Section
16.4.
(fff) “Non-Material
Taking:”
shall
have the meaning set forth in Section
16.4.
(ggg) “Occupancy
Agreement Report:”
shall
have the meaning set forth in Section
9.2.
(hhh) “Occupancy
Agreements:”
All
occupancy agreements, “trade-out agreements”, advance booking agreements,
events, banquet room and convention reservation agreements and similar
agreements or commitments, if any, other than the Leases and Guest Bookings,
demising space and providing for the use or occupancy of, or otherwise
similarly
affecting or relating to the use or occupancy of the Real Property, together
with all amendments, modifications, renewals and extensions thereof and
all
guarantees by third parties of the obligation of the holder of the occupancy
right.
(iii) “Operating
Lease:”
The
certain lease of even date hereof between Seller, as Landlord, and Pleasant
Valley 350 Catering Associates, L.L.C., as Tenant, respecting the catering
facility at the Property, pursuant to which the Operating Tenant shall
lease and
operate the catering facility at the Property.
(jjj) “Operating
Tenant:”
The
tenant under the Operating Lease.
(kkk) “Owner’s
Title Policy:”
The
owner’s policy of title insurance to be issued to Buyer by the Title Company.
(lll) “Ownership
Evidence:”
shall
have the meaning set forth in Section
16.11.
(mmm) “Permits:”
All
licenses and permits granted by any Governmental Authority and owned or
held by
Seller and used in or relating to the current ownership, occupancy or operation
of the Hotel by Seller, and not subject to a Lease, including, without
limitation, certificates of occupancy (if any), elevator permits (if any),
hotel
occupancy permits (if any), zoning variances (if any), business licenses
and
liquor licenses (if any), which are freely capable of assignment by Seller
to
Buyer in accordance with the terms of this Agreement.
(nnn) “Personal
Property:”
Collectively, FF&E, Inventory, Records, Lease Files, Advance Deposits,
Occupancy Agreements, Guest Bookings and Intangible Property.
(ooo) “Property:”
shall
have the meaning set forth in Section
2.
(ppp) “Property
Reports:”
shall
have the meaning set forth in Section
3.1(d).
(qqq) “Prorations”
shall
have the meaning set forth in Section
10.3.
(rrr) “Purchase
Price”
shall
have the meaning set forth in Section
4.2(a).
(sss) “Purchase
Price Balance”
shall
have the meaning set forth in Section
4.2(b).
(ttt) “Real
Property:”
Collectively, the Land and the Improvements.
(uuu) “Records:”
All
books, ledgers, records, correspondence and other files, whether paper
or
electronic (and including any accounting, database or other record-keeping
software used in connection with such records and files which Seller owns
and
may freely transfer or may otherwise freely transfer), to the extent in
the
possession of Seller at the time of the Closing, which have been received
or
generated and maintained in the course of the operation, maintenance or
repair
of the Hotel, promotional material, telephone exchange numbers (to the
extent
freely assignable) (if any), guest and tenant data (if any), sales files
and
market studies (if any), and other materials of any kind (if any) which
are used
by Seller solely in connection with the ownership and operation of the
Real
Property.
(vvv) “Reimbursable
Amounts:”
shall
have the meaning set forth in Section
16.4.
(www) “Required
Payment Lien Cap:”
shall
have the meaning set forth in Section
6.2(b).
(xxx) “Required
Payment Liens:”
shall
have the meaning set forth in Section
6.2(b).
(yyy) “Restaurant
Lease:”
The
certain Agreement of Lease between West Orange Catering Associates, L.L.C.,
as
Landlord, and Xxxxxxxx Enterprises, Inc. and/or Xxxxxxxx Xxxxxxxx, as tenant,
dated February 19, 2004 respecting certain premises at the
Improvements.
(zzz) “Restaurant
Tenant:”
The
tenant under the Restaurant Lease.
(aaaa) “Sales
Tax Documents:”
shall
have the meaning set forth in Section
9.5.
(bbbb) “Scheduled
Closing Date:”
shall
have the meaning set forth in Section
9.1.
(cccc) “Seller
Parties:”
shall
mean Seller, its officers, directors, members, shareholders, owners, partners,
principals, representatives, employees, consultants, contractors, and agents,
and their respective successors and assigns.
(dddd) “Seller’s
Title Objection Election Notice:”
shall
have the meaning set forth in Section 6.2(b).
(eeee) “Seller’s
Manager:”
Horizon
Hotels Limited.
(ffff) “Seller’s
Verification Notices:” shall have the meaning set forth in Section
11.3.
(gggg) “Service
Contracts:”
Other
than the Restaurant Lease, Management Agreement and all other Leases for
occupancy, the service, supply, maintenance, construction, financing, leasing,
equipment financing and other contracts entered into by Seller (or Seller’s
predecessor) or on behalf of Seller by Seller’s Manager, or assumed or accepted
by Seller when Seller acquired the Property, affecting the Property, or
otherwise in effect in respect of Personal Property at the Property, including
without limitation, equipment leases and credit card company agreements,
if any.
(hhhh) “Service
Contract Schedule:”
shall
have the meaning set forth in Section
7.1(e).
(iiii) “Settlement
Statement:”
shall
have the meaning set forth in Section
9.2.
(jjjj) “Specified
UCC’s:”
shall
have the meaning set forth in Section
6.2(g).
(kkkk) “Xxxxxxx
Employment Agreement:”
shall
have the meaning set forth in Section
9.3.
(llll) “Taking:”
shall
have the meaning set forth in Section
16.4.
(mmmm) “Testing:”
shall
have the meaning set forth in Section
3.4.
(nnnn) “Title
Company:”
shall
mean Fidelity Title Insurance Company or Xxxxxxx Title Insurance
Company.
(oooo) “Title
Objections:”
shall
have the meaning set forth in Section
6.2(a).
(pppp) “Title
Report:”
shall
have the meaning set forth in Section
6.2(a).
(qqqq) “Title
Report Objection Date:”
shall
have the meaning set forth in Section 6.2(a).
(rrrr) “Title
Report Objection Notice:”
shall
have the meaning set forth in Section 6.2(a).
(ssss) “Title
Review Expiration Date:”
5:00
pm Eastern Standard Time on the 21st
day
after the Effective Date (or the next succeeding Business Day if such day
is not
a Business Day).
(tttt) “Title
Review Period:”
The
period commencing on the Effective Date and expiring on the Title Review
Expiration Period.
(uuuu) “Unexpended
Fund Balance:”
shall
have the meaning set forth in Section
4.2(c)..
Intentionally
Omitted
SCHEDULE
B
Land
Description
The
Land
is described on the next following page.
SCHEDULE
C
SERVICE
CONTRACTS IN EXISTENCE AS OF THE DATE OF THE AGREEMENT
1. Monitoring
Agreement with Alcatraz Security Systems, Inc. (three separate
accounts).
2. Intentionally
Omitted
3. Copy
Machine Lease with Citicorp Vendor Finance, Inc.
4. Master
Lease Agreement (financing agreement) in respect of vehicle made among
TEAM
Leasing, L.L.C. (“Team”), West Orange Hotel Associates, L.L.C. (“WOHA”) and X.X.
Xxxx & Co., Inc. (“Mase”), dated October 2, 2003, assigned by Team to
American Finance Company.
5. Kitchen
equipment Lease (financing agreement) between Team, WOHA and Mase,
6. The
Air
Conditioning Agreement.
7. Agreement
between LogeNet Entertainment Corporation and WOHA, dated July 7, 2003,
respecting satellite television services, together with separate agreement
whereby LodgeNet provides “guest pay programming.”
8. Software
License and Maintenance Agreement dated June 14, 2001 between UniFocus,
L.P. and
X.X. Xxxx Property Management Corp.
9.
Website
hosting agreement between WOHA and Lars & Associates.
10. Elevator
service Agreement between Xxxxxx Elevator Company, Inc. and WOHA, dated
Septemeber 1, 2004.
11. Intentionally
Omitted
12. Landscape
Contract with D. Torluccion Landscaping, LLC.
SCHEDULE
D
CERTAIN
PERMITTED EXCEPTIONS
1. Liens
for
taxes, assessments and other charges to be apportioned or adjusted pursuant
to
this Agreement.
2. Easements
contained in Deed Book 4272, Page 541 to Public Service Electric and Gas
Company
and/or New Jersey Xxxx Telephone Company.
3. Boundary
Agreement recorded in Deed Book 4460, Page 175.
4. Easement
and right of way recorded in Deed Book 5055, Page 555 and Deed Book 181,
Page
354.
5. Easement
in Deed Book G82, Page 20.
6. 20
foot
and 15 foot sanitary sewer easements shown on Tax Map of the Land, and
all other
matters shown on the Tax Map of the Land.
8. The
Leases and the Service Contracts.
9. All
financing statements, UCC’s and other notices concerning any equipment financing
agreements and/or equipment financing leases which are to be assumed by
or
assigned to Buyer pursuant to this Agreement.
10. Any
and
all catering contracts and Occupancy Agreements (if any) in existence as
of the
Closing for an event which occurs after the Closing.
11. The
matters on Schedule H.
12. The
Specified UCC’s, provided that if Buyer shall procure title insurance at the
Closing, the Title Company shall be willing to omit same from Buyer’s title
insurance policy at the Closing or provide affirmative insurance that such
UCC
financing statements will not be collected out of the Property (it being
understood that Seller shall have the right, but not the obligation, to
pay any
additional premium charged by the Title Company for providing such affirmative
insurance).
SCHEDULE
E
PROPERTY
REPORTS
Item
1. Property
Condition Assessment, 4-19-05 Draft, Wilshire Grand Hotel, West Orange,
New
Jersey prepared by O & S Associates, Consulting Engineers.
Item
2: Essex
County Regional Health Commission Files re: Property at Town & Campus of
West Orange, 000 Xxxxxxxx Xxxxxx Xxx, Xxxx Xxxxxx, Xxx Xxxxxx.
• Facility
Survey Report - 6/16/1997, prepared by Essex County Inspector
• Suburban
Regional Health Commission Form Permit Application - 6/26/1992
• Emission
Source Application Data Sheet - 6/10/1992, prepared by Xxxxxx Xxx,
Treasurer
• Suburban
Regional Health Commission Certificate of Registration for Sources of Air
Emissions - January 1, 1992 to December 31, 1996, Issue Date:
6/26/1992
Item
3: User
Furnished Information
• Letter
to
X.X. Xxxx Construction Company, Inc. from Xxxx XxXxxxx, Director, Division
of
Enforcement and Compliance Assistance, U.S. Environmental Protection Agency
dated 6/1/2004 Re: Section 114 Letter Reference No. CAA 02 2004 1492
Requirements
• Response
Letter to Air Compliance Branch, Division of Enforcement and Compliance
Assistance, U.S. Environmental Protection Agency - Region 2, from X.X.
Xxxx
Construction Company, Inc. dated 2/7/2005 Re: Section 114 Letter Reference
No.
CAA 02 2004 1492 Compliance Order
• NJ
Department of Health Report of Inspection dated 2/7/2005 -
Unsatisfactory
• Enclosure
1 - Information Request Under the Clean Air Act (with Responses) - no
date
• U.S.
Environmental Protection Agency - X.X. Xxxx Construction Company Answers
to
Enclosure II - no date (with Exhibits)
• Exhibit
1
- Notification of Asbestos Abatement dated 7/9/2001
• Exhibit
2
- PLM Bulk Asbestos Report dated 7/9/2001
• Exhibit
3
- Summary of Bulk Asbestos Analysis Results
• Exhibit
4
- Airborne Fiber Analysis - 7/20/2001
• Exhibit
5
- Certificate of Completion - Asbestos Removal - 7/27/2001
• Exhibit
6
- Asbestos Waste Shipment Record
• Exhibit
7
- Notification of Asbestos Abatement - 8/15/2003
• Exhibit
8
- Asbestos Bulk Sampling Report
• Exhibit
9
- NJ Department of Health Report Inspection - 8/6/2003
• The
Xxxxxxx Companies, Inc. Phase I Environmental Site Assessment dated
5/24/2004
details existing Conditions of 000 Xxxxxxxx Xxxxxx Xxx, Xxxx Xxxxxx, Xxxxx
Xxxxxx, Xxx Xxxxxx
• attaches
References - maps
• Property
Condition Assessment of Wilshire Grand Hotel - Draft - 4/19/2005
• Performed
by O & S Associates
• Construction
Permit Notice & Permit - 6/4/2001 - for 000 Xxxxxxxx Xxxxxx Xxx
• Tree
Permit Application - 6/12/2001 - 000 Xxxxxxxx Xxxxxx Xxx
• Permit
Updates - with attached application for 000 Xxxxxxxx Xxxxxx Xxx
• Building
Subcode (dated 11/16/01)
• Fire
Subcode (dated 9/30/02)
• Plumbing
Subcode (dated 9/12/02)
• Electrical
Subcode (dated 7/15/02(?))
• Letter
to
Environmental Energy Consultants from The Trust Co. of New Jersey dated
12/28/1990 Re: Town & Campus ECRA Walk-through
• Letter
to
The Trust Co. of New Jersey from EEC Environmental, Inc. dated 3/7/1991
Re:
Results of Environmental Site Inspection for Town & Campus, Inc., 000
Xxxxxxxx Xxxxxx Xxx
• Attachment
A - Xxxxx’x October 1989 Tank Removal Operation Report
• Appendix
A - Tank Registrations
• Appendix
B - Removal and Abandonment Permits
• Appendix
C - Soil Sample and Decontamination Procedures
• Appendix
D - Laboratory Analyses
• Invoice
from EEC Environmental to Trust Co. of New Jersey for professional services
-
$1,500.00
Item
4: EDR
Radius Search Report
• Environmental
Data Resources, Inc. Manual - “The Standard in Environmental Risk Management
Information” - 4/8/2005
• Environmental
Data Resources, Inc. Manual - “The Standard in Environmental Risk Management
Information” - 5/12/2005
Item
5: Asbestos
Containing Materials Rules for Buildings Constructed Before 1981
(OSHA)
Item
6: Statement
of Qualifications - Xxxxxxx Xxxxxx, Environmental Scientist
Item
7: Property
Condition Assessment, dated April 19, 2005, concerning the Wilshire Grand
Hotel,
prepared by O&S Associates Consulting Engineers, together with Amendment No.
1 to such report, dated May 31, 2005
Item
8: Phase
I
Environmental Site Assessment for 000 Xxxxxxxx Xxxxxx Xxx, dated May 24,
2005,
prepared by The Xxxxxxx Companies, Inc.
Item
9: Letter,
dated June 1, 2004, from United States Environmental Protection Agency
to
Xxxxxxx X. Xxxxxxx, referring to Section 114 Letter Reference No.
CAA-02-2004-1492
Item
10: Letter
from X.X. Xxxx Construction Company, Inc. to Xxxxxxx Xxx, Branch Chief,
dated
February 7, 2005, concerning Section 114 Letter Reference No. CAA-02-2004-1492,
with inspection reports attached and also attached:
|
§
|
Information
Requests under the Clean Air Act with Enclosures I and
II
|
|
§
|
Documentation
concerning asphalt shingles without piping for thermal insulation
and
construction permit notices and
updates
|
Item
11: Email
notice, dated May 2, 2005, from Xxxxxxxx Xxxxx Xxxx of The Xxxxxxx Companies,
Inc. to Xxx Xxxxx, with attached emails dated May 1, 2005, April 21,
2005
Item
12: Letter
dated April 22, 2005 from Xxxxxxxx X. Xxxx of The Xxxxxxx Companies, Inc.
to Xxx
Xxxxx
Item
13: Letter
dated May 3, 2005 from Xxxxxxx Xxxxxx of The Xxxxxxx Companies, Inc. to
Xxx
Xxxxx with attached email from Xxxxxxxx Xxxxx Xxxx, dated April 21, 2005,
second
attached email from Xxxxxxxx Xxxxx Xxxx dated April 21, 2005, and attached
email
from Xxx Xxxxx to Xxxxxxxx Xxxxx Xxxx dated May 2, 2005
Item
14: Email
from Xxxxxxxx Xxxxx Xxxx to Xxx Xxxxx, dated May 2, 2005, with attached
emails
from Xxx Xxxxx to Xxxxxxxx Xxxxx Xxxx dated May 1, 2005, April 22, 2005
and
April 21, 2005
Item
15: Email
from Xxx Xxxxx to Xxxxxxxx Xxxxx Xxxx dated May 1, 2005 with attached emails
from Xxxxxxxx Xxxxx Xxxx dated April 22, 2005 and April 23, 2005
Item
16: 2004-2005
Preliminary Tax Xxxx of Block 152.22, Lot 1428
Item
17: Income
Statement of West Orange Hotel Associates, LLC for the 12 Periods Ended
December
31, 2004
Item
18: Horizon
Hotels Budget for second quarter, 2005
Item
19: Memo
dated April 8, 2005 to Xxx Xxxxx from Xxxxx X. Xxxxxxx attaching Capital
Expenditures for 2005, 2006 and 2007
Item:
20: Memo
dated April 7, 2005 to Xxx Xxxxx from Xxxxx X. Xxxxxxx attaching 12 Month
Rolling-Occupancy/ADR
Item
21: Memo
dated May 31, 2005 to Xxx Xxxxx/X. Xxxxxx from Xxxxx X. Xxxxxxx attaching
outline of Operational Issues
Item
22: Letter
dated August 27, 2003 to Xxxxx Xxxx of the West Orange Planning Board from
Xxxxx
Xxxxxxxxx of the County of Essex Department of Public Works concerning
application of West Orange Catering
Item
23: Three
temporary Certificates of Occupancy/Compliance: (i) one concerning the
Banquet
Halls and dated Xxxxx 0, 0000, (xx) one concerning the Wilshire Grande
Hotel and
dated July 31, 2003, and (iii) one concerning Primavera Restaurant and
dated
June 30, 2004
Item
24: Xxxxxx
Agency Insurance quote for umbrella liability insurance dated May 31, 2005
for
Wilshire Grand Hotel
Item
25: Letter
to
Xxxxxx Xxxxx from Xxxxx X. Xxxxxxxxxx, Esq. dated June 30, 2004 enclosing
a copy
of the Lease Agreement for the Primavera Restaurant
SCHEDULE
F
OCCUPANCY
AGREEMENTS
See
following pages
2005
CATERING AFFAIRS
|
Banquet
|
Type
|
Date
|
Liquor
(Y/N)
|
|
Xxxxxxxxxxx
Party
|
Barmitzvah
|
10/1/05
|
N
|
|
UMDNJ
|
Lunch
Meeting
|
10/15/05
|
N
|
|
POA
|
Business
Meeting
|
10/19/05
|
N
|
|
Travel
Impressions
|
Travel
Expo
|
10/26/05
|
Y
|
|
Xxxxx
Hamlet
|
Wedding
|
10/29/05
|
Y
|
|
Rooney
Party
|
Sweet
16
|
11/4/05
|
Y
|
|
Pecknay
Party
|
Batmitzvah
|
11/12/05
|
Y
|
|
POA
|
Business
Meeting
|
11/16/05
|
N
|
|
Xxxxxxxxx
Party
|
Wedding
|
11/26/05
|
Y
|
|
Continental
Systems
|
Holiday
Party
|
12/9/05
|
Y
|
|
Xxxxxxxx
Party
|
Batmitzvah
|
12/17/05
|
Y
|
2006
CATERING AFFAIRS
|
Banquet
Functions For 2006.
|
Liquor
(Y/N)
|
||
|
Xxxxxxxxx
Barmitzvah
|
1/7/06
|
Richfield
Regency
|
Y
|
|
American
Savings Meeting
|
1/19/06
|
Inhouse
|
N
|
|
Xxxxxxxxxx
Barmitzvah
|
2/10-2/12/06
|
Total
Event
|
Y
|
|
Xxxxxxxx
Barmitzvah
|
3/4/06
|
Total
Event
|
Y
|
|
Xxxxx
Barmitzvah
|
4/23/06
|
Richfield
Regency
|
Y
|
|
Xxxxxxx
Wedding
|
5/28/06
|
TBD
|
Y
|
|
Xxxxxx
Barmitzvah
|
6/3/06
|
Richfield
Regency
|
Y
|
|
Xxxxxx
Barmitzvah
|
6/10/06
|
Richfield
Regency
|
Y
|
|
Xxxxxxxxx
Barmitzvah
|
10/28-29/06
|
Prestige
|
Y
|
SCHEDULE
G
Intentionally
Omitted
SCHEDULE
H
LITIGATION
AND
OTHER
PROCEEDINGS
1. Summons
issued to Owner’s predecessor for failure to install fence along northerly
property line and failure to maintain an outbuilding.
2. Claims
by
AssaBloy VingCard, Inc. for amounts allegedly due in connection with the
key
entry system at the Hotel (and possible actions relating thereto).
3. United
States Environmental Protection Agency Compliance Order (CAA-02-2005-1011)
and
Section 114 Letter (CAA-02-2004-1492).
4. Xxxx
Party Rentals vs. Wilshire Grand Hotel
Superior
Court of New Jersey
Law
Division: Essex County
Special
Civil Part
Xxxxxx
Xx. XX 0000-00
5. Incident
report filed by Wilshire Hotel guest, Xxxxxx Xxxxxx, on or about
February
22, 2005, alleging she grabbed a paper towel in the ladies Bathroom and
was
pricked by a hypodermic needle wrapped in the paper Towel.
6.
Xxxxx
vs. West Orange Hotel Associates, et al.
Superior
Court of New Jersey
Law
Division, Essex County
Docket
No. ESX-L-8826-04.
7.
Moghul
Caterers vs. X.X. Xxxx d/b/a Wilshire Grand Hotel
Superior
Court of New Jersey
Law
Division, Xxxxxx County
Special
Civil Part
Docket
No. 003014-05.
8.
Euro
Waiters, LLC vs. Wilshire Grand Hotel
Superior
Court of New Jersey
Law
Division, Essex County
Special
Civil Part, Docket No. SC-1881-05.
EXHIBIT
A
Intentionally
Omitted
EXHIBIT
B
DEED
|
DEED
This
Deed is made as of ___________ ____, 2005
|
Prepared
By:
______________________________
XXXX
X. XXXXXXXX , ESQ.
|
BETWEEN
WO
GRAND
HOTEL, LLC, a New Jersey limited liability corporation, whose address is
c/o
Wilshire Enterprises, 0 Xxxxxxx Xxxxxx, Xxxxxx, Xxx Xxxxxx 00000.
referred
to as the Grantor,
AND
__________________________,
a ___________________limited liability company, whose address is
_______________________________,
referred
to as the Grantee.
The
words
"Grantor" and "Grantee" shall mean all Grantors and all Grantees listed
above.
Transfer
of Ownership.
The
Grantor grants and conveys (transfers ownership of) the property described
below
to the Grantee. This transfer is made for the sum of
[___________________________________________] and __/100 ($__________._))
Dollars. The Grantor acknowledges receipt of this money.
Tax
Map Reference.
(N.J.S.A. 46:15-1.1) Township of West Orange, County of Essex
Block
Number 152.22, Lot Number 1428
Property.
The
property consists of the land and all the buildings and structures on the
land
in the Township of West Orange, County of Essex and State of New Jersey.
The
legal description is:
SEE
LEGAL
DESCRIPTION ATTACHED HERETO AND MADE A PART HEREOF
BEING
commonly known as 000 Xxxxxxxx Xxxxxx Xxx, Xxxx Xxxxxx, Xxx Xxxxxx.
BEING
the
same premises conveyed to the Grantor herein by Deed from Wilshire Enterprises,
Inc., dated June 2, 2005 and recorded _____________________ in the Office
of the
Clerk of Essex County in Deed Book ________ Page _________.
Promises
by Grantor.
The
Grantor promises that, except for the Permitted Exceptions as hereinafter
defined, the Grantor has done no act to encumber the property. This promise
is
called a "covenant as to grantor's acts" (N.J.S.A. 46:4-6). This promise
means
that, except for the Permitted Exceptions, the Grantor has not allowed
anyone
else to obtain any legal rights which affect the property (such as by making
a
mortgage or allowing a judgment to be entered against the Grantor).
THIS
DEED
IS SUBJECT to, among other things, covenants, easements and restrictions
of
record, items of public record, taxes, and such state of facts as an accurate
survey would disclose, and the matters attached hereto on Exhibit
A
(collectively, the “Permitted Exceptions”).
[balance
of page intentionally left blank]
Signatures.
The Grantor signs this Deed as of the date at the top of the first
page.
WO
GRAND
HOTEL, LLC
a
New
Jersey limited liability company
By:
Wilshire Enterprises, Inc.
a
Delaware corporation
By:
____________________________
Name:
Title:
STATE
OF
NEW JERSEY
COUNTY
OF
ESSEX
I
CERTIFY
that on _______________ _____, 2005, ______________ personally came before
me
and this person acknowledged under oath, to my satisfaction, that:
|
(a)
|
this
person signed, sealed and delivered the attached document as
President of
Wilshire Enterprises, Inc., a member of the Grantor named in
this
document;
|
|
(b)
|
this
document was signed and made by the ______________ as its voluntary
act
and deed by virtue of authority from its _____________________;
and
|
|
(c)
|
the full and actual consideration paid or to be paid for the transfer of title is $________________________.___. (Such consideration is defined in N.J.S.A. 46:15-5.) |
________________________________
|
D
E
E D
|
Dated:
As of __________, 2005
|
|
WO
GRAND HOTEL, LLC
a
New Jersey limited liability company
Grantor,
TO
[______________________________],
Grantee.
|
Record
and return to:
|
EXHIBIT
A
Title
Exceptions (to be attached)
EXHIBIT
C
XXXX
OF
SALE
XXXX
OF SALE
WO
GRAND
HOTEL, LLC, a New Jersey limited liability company ("Assignor"),
in
consideration of the sum of TEN AND NO/100 DOLLARS ($10.00), the receipt
and
sufficiency of which are hereby acknowledged, does hereby grant, bargain,
sell,
convey, assign, transfer, set over and deliver (collectively, "assign")
unto
[_________________________________],
a
[_____________] limited liability company ("Assignee"),
all
of Assignor’s right, title and interest in and to all of the Personal Property
(as such term is defined in that certain Hotel Purchase Agreement dated
as of
the __ day of September 2005, by and between Assignor, as seller, and Assignee,
as purchaser).
TO
HAVE
AND TO HOLD the Personal Property unto Assignee and Assignee’s heirs, legal
representatives, successors and assigns forever.
THE
PERSONAL PROPERTY IS BEING ASSIGNED AND CONVEYED "AS IS", "WHERE IS", AND
"WITH
ALL FAULTS" AS OF THE DATE OF THIS XXXX OF SALE, WITHOUT ANY REPRESENTATION
OR
WARRANTY WHATSOEVER AS TO ITS CONDITION, FITNESS FOR ANY PARTICULAR PURPOSE,
MERCHANTABILITY OR ANY OTHER WARRANTY, EXPRESSED OR IMPLIED, EXCEPT THAT,
WITH
RESPECT ONLY TO THE ITEMS SET FORTH ON SCHEDULE
A
HERETO,
SELLER REPRESENTS THAT SELLER HAS NOT LEASED, PLEDGED, ENCUMBERED OR
HYPOTHETICATED THE PERSONAL PROPERTY SET FORTH ON SCHEDULE
A.
ASSIGNEE IS HEREBY ACQUIRING THE PERSONAL PROPERTY BASED SOLELY UPON ASSIGNEE’S
OWN INDEPENDENT INVESTIGATIONS AND INSPECTIONS AND NOT IN RELIANCE ON ANY
INFORMATION PROVIDED BY ASSIGNOR OR ASSIGNOR’S AGENTS OR CONTRACTORS. ASSIGNOR
HAS MADE NO AGREEMENT TO ALTER, REPAIR OR IMPROVE ANY OF THE PERSONAL PROPERTY.
ASSIGNOR SPECIFICALLY DISCLAIMS ANY WARRANTY, GUARANTY OR REPRESENTATION,
ORAL
OR WRITTEN, PAST OR PRESENT, EXPRESSED OR IMPLIED, CONCERNING THE PERSONAL
PROPERTY OR ASSIGNOR’S TITLE THERETO.
IN
WITNESS WHEREOF, the parties have signed and delivered this Xxxx of Sale
as of
the _____ day of _______________ 2005.
ASSIGNOR:
WO
GRAND HOTEL LLC,
a New
Jersey limited liability company
|
By:
|
Wilshire
Enterprises, Inc., a Delaware corporation, its
[________________]
|
|
By:
|
______________________________
|
SCHEDULE
A
[to
be
completed at closing]
EXHIBIT
D
ASSIGNMENT
AND ASSUMPTION OF LEASES
ASSIGNMENT
AND ASSUMPTION OF LEASES
This
Assignment and Assumption Agreement is entered into as of ____________
___, 2005
by and between WO
GRAND HOTEL, LLC,
a New
Jersey limited liability company (“Assignor”),
as
assignor, and [_______________________________] a ______________limited
partnership (“Assignee”),
as
assignee.
Background
In
connection with the sale by Assignor to Assignee of that certain property
known
as the Wilshire Grand Hotel located in the Township of West Orange, Essex
County, New Jersey, pursuant to that certain Hotel Purchase Agreement dated
September__, 2005 between Assignor, as seller, and Assignee, as purchaser
(as
the same may have been amended, the “Purchase
Agreement”).
Assignor desires to assign to Assignee, and Assignee agrees to assume Assignor’s
obligations under the leases listed on Schedule
“A”
attached hereto (collectively, the “Leases”), as set forth herein.
NOW,
THEREFORE, in consideration of the premises and mutual covenants and agreements
contained herein, and other good and valuable consideration delivered on
the
date hereof, the receipt and sufficiency of which are hereby acknowledged,
and
intending to be legally bound, Assignor and Assignee hereby agree as
follows:
1. Assignor
hereby grants, assigns, transfers, sets over, conveys, and delivers to
Assignee,
its successors and assigns, any and all of its right, benefit, title, interest,
and privilege in, to, and under, all of the Leases.
2. Assignee
hereby assumes Assignor’s liabilities and obligations under, and shall be bound
by, the terms and conditions of each of the Leases from and after the date
hereof.
3. This
Assignment is made without any representation or warranty by Assignor
whatsoever, except as may otherwise be expressly provided pursuant to the
Purchase Agreement.
4.
Assignor
and Assignee each indemnify and hold the other harmless with respect to
the
Leases, but only to the extent specifically provided in the Purchase Agreement.
5. The
performance and interpretation of this Assignment and Assumption Agreement
will
be controlled by the laws of the State of New Jersey without giving effect
to
its conflict of laws provisions.
6. The
covenants and agreements contained in this Assignment and Assumption Agreement
shall be binding upon and shall inure to the benefit of the parties hereto
and
their respective successors and assigns, and are for the sole benefit of
the
parties hereto and their permitted successors and assigns, and such covenants
and agreements shall not be construed as conferring and are not intended
to
confer any rights or benefits on any other persons.
7. This
Assignment and Assumption Agreement may be executed in any number of
counterparts, each of which when executed and delivered shall be deemed
to be an
original and all of which when taken together shall constitute but one
and the
same instrument.
[balance
of page intentionally left blank]
IN
WITNESS WHEREOF, Assignor and Assignee have each caused this Assignment
and
Assumption Agreement to be duly executed as of the day and year first above
written.
ASSIGNOR:
WO
GRAND HOTEL, LLC
a
New
Jersey limited liability company
By: Wilshire
Enterprises, Inc., its [___________]
By: ______________________________
Name:
Xxx
Xxxxx
Title:
President
ASSIGNEE:
[_____________________]
By:______________________________
Name:
Title:
SCHEDULE
A
LEASES
EXHIBIT
E
ASSIGNMENT
AND ASSUMPTION OF CONTRACTS
ASSIGNMENT
AND ASSUMPTION OF CONTRACTS
This
Assignment and Assumption Agreement (this “Assignment”)
is
entered into as of ____________ ___, ________ by and between WO
GRAND HOTEL, LLC,
a New
Jersey limited liability company (“Assignor”),
as
assignor, and [_______________________________] a ______________limited
partnership (“Assignee”),
as
assignee.
Background
In
connection with the sale by Assignor to Assignee of that certain property
known
as the Wilshire Grand Hotel located in the Township of West Orange, Essex
County, New Jersey, pursuant to that certain Hotel Purchase Agreement dated
September__, 2005 between Assignor, as seller, and Assignee, as purchaser
(as
the same may have been amended, the “Purchase
Agreement”).
Assignor desires to assign to Assignee, and Assignee agrees to assume Assignor’s
obligations under the agreements listed on Schedule
“A”
attached hereto (collectively, the “Assigned Contracts”), as set forth herein.
NOW,
THEREFORE, in consideration of the premises and mutual covenants and agreements
contained herein, and other good and valuable consideration delivered on
the
date hereof, the receipt and sufficiency of which are hereby acknowledged,
and
intending to be legally bound, Assignor and Assignee hereby agree as
follows:
1. Assignor
hereby grants, assigns, transfers, sets over, conveys, and delivers to
Assignee,
its successors and assigns, any and all of its right, benefit, title, interest,
and privilege in, to, and under, all of the Assigned Contracts.
2. Assignee
hereby assumes Assignor’s liabilities and obligations under, and shall be bound
by, the terms and conditions of each of the Assigned Contracts from and
after
the date hereof. This Assignment is made without any representation or
warranty
by Assignor whatsoever, except as may otherwise be expressly provided pursuant
to the Purchase Agreement.
4.
Assignor
and Assignee each indemnify and hold the other harmless with respect to
the
Assigned Contracts, but only to the extent specifically provided in the
Purchase
Agreement.
5. The
performance and interpretation of this Assignment and Assumption Agreement
will
be controlled by the laws of the State of New Jersey without giving effect
to
its conflict of laws provisions.
6. The
covenants and agreements contained in this Assignment and Assumption Agreement
shall be binding upon and shall inure to the benefit of the parties hereto
and
their respective successors and assigns, and are for the sole benefit of
the
parties hereto and their permitted successors and assigns, and such covenants
and agreements shall not be construed as conferring and are not intended
to
confer any rights or benefits on any other persons.
7. This
Assignment and Assumption Agreement may be executed in any number of
counterparts, each of which when executed and delivered shall be deemed
to be an
original and all of which when taken together shall constitute but one
and the
same instrument.
IN
WITNESS WHEREOF, Assignor and Assignee have each caused this Assignment
and
Assumption Agreement to be duly executed as of the day and year first above
written.
ASSIGNOR:
WO
GRAND HOTEL, LLC
a
New
Jersey limited liability company
By: Wilshire
Enterprises, Inc., its [___________]
By: ______________________________
Name:
Xxx
Xxxxx
Title:
President
ASSIGNEE:
[_____________________]
By:______________________________
Name:
Title:
SCHEDULE
A
ASSIGNED
CONTRACTS
EXHIBIT
F
AFFIDAVIT
OF TITLE
AFFIDAVIT
OF TITLE
STATE
OF
NEW JERSEY )
SS.
COUNTY
OF
ESSEX )
XXXXXX
X.
XXXXX says under oath:
1. President.
I am
president of Wilshire Enterprises, Inc., which is a Member of WO GRAND
HOTEL,
LLC, a limited liability company formed under the laws of the State of
New
Jersey. The limited liability company will be called the “LLC” and sometimes
simply “it” or “its”. The LLC has offices located at c/o Wilshire Enterprises,
Inc., Xxx Xxxxxxx Xxxxxx, Xxxxxx, Xxx Xxxxxx 00000. I am fully familiar
with the
business of the LLC, a citizen of the United States and at least 18 years
old.
2. Representations.
The
statements contained in this affidavit are true to the best of my knowledge,
information and belief.
3. Authority.
The LLC
is the only owner of fee title to the real property known as the Wilshire
Grand
Hotel located at 000 Xxxxxxxx Xxxxxx Xxx, Xxxx Xxxxxx, Xxx Xxxxxx called
"this
property".
This
property is to be sold by the LLC to ________________, a _____________
limited
liability company (the “Buyer”).
This
action, and the making of this affidavit of title, have been duly authorized
by
the LLC. The Certificate of Formation and Operating Agreement of the LLC
are
attached hereto. There has been no change in the composition of the LLC
since
its formation and the Operating Agreement has not been modified or amended.
The
LLC is legally authorized to transact business in New Jersey. It is not
restrained from doing business nor has any legal action been taken for
that
purpose. It has never changed its name or used any other name. The LLC
has not
classified itself as a corporation for federal income tax purposes.
4. Ownership
and Possession.
The LLC
has owned this property since June 2, 2005.
5. Improvements.
No
additions, alterations or improvements are now being made by the LLC or
have
been made by the LLC to this property since June 2, 2005 which have not
been
paid or will duly be paid.
6. Bankruptcy
and Judgments.
No
bankruptcy or insolvency proceedings have been started by or against it,
nor has
it ever been declared bankrupt. All bankruptcies and judgments listed on
the
attached judgment searches are not against the LLC, but against others
with
similar names.
7. Reliance.
The LLC
makes this affidavit in order to induce the Buyer to buy the Property.
It is
aware that the Buyer will rely on the statements made in this affidavit
and on
its truthfulness.
Signed
and sworn to before me on
_____________
____, 2005.
| XXXXXX X. XXXXX |
EXHIBIT
G
ASSIGNMENT
AND ASSUMPTION OF PERMITS
ASSIGNMENT
AND ASSUMPTION OF PERMITS
This
Assignment and Assumption Agreement is entered into as of ____________
___, 2005
by and between WO
GRAND HOTEL, LLC,
a New
Jersey limited liability company (“Assignor”),
as
assignor, and [_______________________________] a ______________limited
partnership (“Assignee”),
as
assignee.
Background
In
connection with the sale by Assignor to Assignee of that certain property
known
as the Wilshire Grand Hotel located in the Township of West Orange, Essex
County, New Jersey, pursuant to that certain Hotel Purchase Agreement dated
September__, 2005 between Assignor, as seller, and Assignee, as purchaser
(as
the same may have been amended, the “Purchase
Agreement”).
Assignor desires to assign to Assignee, and Assignee agrees to assume Assignor’s
obligations under the Permits listed on Schedule
“A”
attached hereto (collectively, the “Assigned Permits”), as set forth
herein
NOW,
THEREFORE, in consideration of the premises and mutual covenants and agreements
contained herein, and other good and valuable consideration delivered on
the
date hereof, the receipt and sufficiency of which are hereby acknowledged,
and
intending to be legally bound, Assignor and Assignee hereby agree as
follows:
1. To
the
extent such assignment is lawful and to the extent same may be freely assigned
by Assignor, Assignor hereby grants, assigns, transfers, sets over, conveys,
and
delivers to Assignee, its successors and assigns, any and all of its right,
benefit, title, interest, and privilege in, to, and under, all of the Assigned
Permits, expressly excluding any licenses or permits related to the sale
or
consumption of liquor or alcoholic beverages.
2. Assignee
hereby assumes Assignor’s liabilities and obligations under, and shall be bound
by, the terms and conditions of each of the Assigned Permits from and after
the
date hereof.
3. This
Assignment is made without any representation or warranty by Assignor
whatsoever, except as may otherwise be expressly provided pursuant to the
Purchase Agreement.
4.
The
performance and interpretation of this Assignment and Assumption Agreement
will
be controlled by the laws of the State of New Jersey without giving effect
to
its conflict of laws provisions.
5. The
covenants and agreements contained in this Assignment and Assumption Agreement
shall be binding upon and shall inure to the benefit of the parties hereto
and
their respective successors and assigns, and are for the sole benefit of
the
parties hereto and their permitted successors and assigns, and such covenants
and agreements shall not be construed as conferring and are not intended
to
confer any rights or benefits on any other persons.
6. This
Assignment and Assumption Agreement may be executed in any number of
counterparts, each of which when executed and delivered shall be deemed
to be an
original and all of which when taken together shall constitute but one
and the
same instrument.
[balance
of page intentionally left blank]
IN
WITNESS WHEREOF, Assignor and Assignee have each caused this Assignment
and
Assumption Agreement to be duly executed as of the day and year first above
written.
ASSIGNOR:
WO
GRAND HOTEL, LLC
a
New
Jersey limited liability company
By: Wilshire
Enterprises, Inc., its [___________]
By: ______________________________
Name:
Xxx
Xxxxx
Title:
President
ASSIGNEE:
[_____________________]
By:______________________________
Name:
Title:
SCHEDULE
A
ASSIGNED
PERMITS
