EXHIBIT 10.118
SECOND AMENDMENT TO PURCHASE AND SALE AGREEMENT
This Second Amendment to Purchase and Sale Agreement ("AMENDMENT") is made
as of the 29th day of March, 2004, by and between CH REALTY II/BEST, L.P., a
Delaware limited partnership ("SELLER"), and INLAND REAL ESTATE ACQUISITIONS,
INC., an Illinois corporation ("PURCHASER").
RECITALS:
WHEREAS, Seller and Purchaser entered into that certain Purchase and Sale
Agreement dated March 5, 2004, for the disposition of that certain real property
located in the City of Las Vegas, Xxxxx County, Nevada more particularly
described in the Agreement, which was subsequently amended by Amendment dated
March 25, 2004, (the Purchase and Sale Agreement as amended, is referred to
herein as the "AGREEMENT");
WHEREAS, Seller and Purchaser desire to further modify the Agreement upon
the terms and conditions stated herein.
NOW, THEREFORE, for and in consideration of the mutual agreements stated
herein and other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged and confessed, Seller and Purchaser hereby agree as
follows:
1. INSPECTION PERIOD. Section 1.1.12 of the Agreement is hereby amended
to extend the Inspection Period from March 29, 2004, until 5:00 p.m. on Friday,
April 2, 2004.
2. CLOSING DATE. Section 1.1.13 of the Agreement is hereby amended to
extend the Closing date from 5:00 p.m., C.S.T. on April 1, 2004, until the
earlier of (i) 5:00 p.m., C.D.T. on Thursday, April 8, 2004, or (ii) the receipt
by Purchaser of the requisite Estoppel Certificates required by the Agreement.
3. NO FURTHER MODIFICATION. Except as expressly set forth in this
Amendment and as previously amended, all terms and provisions of the Agreement
are hereby confirmed and remain unmodified and in full force and effect, such
terms and provisions being hereby incorporated herein for all purposes.
4. MULTIPLE COUNTERPARTS. This Amendment may be executed in a number of
identical counterparts. Each such counterpart is deemed an original for all
purposes and all such counterparts shall, collectively, constitute one
agreement, but, in making proof of this Amendment or the Agreement, it shall not
be necessary to produce or account for more than one counterpart.
5. FACSIMILE TRANSMISSION. For the purposes of this Amendment, the
parties agree that they will accept and rely upon facsimile transmission and
execution of this Amendment to be binding upon each other. To the extent the
parties choose to rely upon execution by facsimile execution and transmission of
this Amendment, the parties shall cause "ink signed originals" of this Amendment
to be delivered to each of the parties and the Title Company.
Page 1
EXECUTED as of the date first above written.
SELLER:
CH REALTY II/BEST, L.P.,
a Delaware limited partnership
By: CH Realty II/Best GP, L.L.C.,
a Delaware limited liability company,
its General Partner
By: Crow Holdings Managers, L.L.C.,
a Texas limited liability company,
its Manager
By: /s/ Xxxxxx X. XxXxxxx
---------------------------------
Name: Xxxxxx X. XxXxxxx
--------------------------------
Title: Vice President
-------------------------------
PURCHASER:
INLAND REAL ESTATE ACQUISITIONS, INC.,
an Illinois corporation
By: /s/ G. Xxx Xxxxxxx
--------------------------------------------
Name: G. Xxx Xxxxxxx
------------------------------------
Title: President
-----------------------------------
Page 2
AMENDMENT TO PURCHASE AND SALE AGREEMENT
This Amendment to Purchase and Sale Agreement ("AMENDMENT") is made as of
the _______day of March, 2004, by and between CH REALTY II/BEST, L.P., a
Delaware limited partnership ("SELLER"), and INLAND REAL ESTATE ACQUISITIONS,
INC., an Illinois corporation ("PURCHASER").
RECITALS:
WHEREAS, Seller and Purchaser entered into that certain Purchase and Sale
Agreement (the "AGREEMENT") dated March 5, 2004, for the disposition of that
certain real property located in the City of Las Vegas, Xxxxx County, Nevada
more particularly described in the Agreement;
WHEREAS, Seller and Purchaser desire to modify the Agreement upon the terms
and conditions stated herein.
NOW, THEREFORE, for and in consideration of the mutual agreements stated
herein and other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged and confessed, Seller and Purchaser hereby agree as
follows:
1. MODIFICATION OF AGREEMENT. Section 7.3.8 of the Agreement and the
requirement for delivery of the document referenced as EXHIBIT G-2 are each
hereby deleted in their entirety. Further, the first paragraph of the Special
Warranty Deed attached to the Agreement as EXHIBIT "B" is hereby amended to read
in its entirety as follows:
"_____________________________, a __________________ ("GRANTOR"),
for and in consideration of the sum of $10.00 and other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, has (i) GRANTED, BARGAINED, SOLD, and CONVEYED and by these
presents does GRANT, BARGAIN, SELL, and CONVEY unto
_____________________________, a __________ ("GRANTEE") the tract or parcel
of land in ______ County, ___________, described in EXHIBIT A. together
with all rights, titles, and interests appurtenant thereto including,
without limitation, Grantor's interest, if any, in any and all adjacent
streets, alleys, rights of way and any adjacent strips and gores (such
land and interests are hereinafter collectively referred to as the
"PROPERTY"), and (ii) assigned to Grantee all of its right, title and
interest to Declarant under that certain Best on the Boulevard Shopping
Center Grant of Reciprocal Easement and Declaration dated November 30,
1994, recorded December 9, 1994, in Book 941209 as Document No. 01660 in
the Real Property Records of Xxxxx County, Nevada".
2. NO FURTHER MODIFICATION. Except as expressly set forth in this
Amendment, all terms and provisions of the Agreement are hereby confirmed and
remain unmodified and in full force and effect, such terms and provisions being
hereby incorporated herein for all purposes.
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3. MULTIPLE COUNTERPARTS. This Amendment may be executed in a number of
identical counterparts. Each such counterpart is deemed an original for all
purposes and all such counterparts shall, collectively, constitute one
agreement, but, in making proof of this Amendment or the Agreement, it shall not
be necessary to produce or account for more than one counterpart.
4. FACSIMILE TRANSMISSION. For the purposes of this Amendment, the
parties agree that they will accept and rely upon facsimile transmission and
execution of this Amendment to be binding upon each other. To the extent the
parties choose to rely upon execution by facsimile execution and transmission of
this Amendment, the parties shall cause "ink signed originals" of this Amendment
to be delivered to each of the parties and the Title Company.
EXECUTED as of the date first above written.
SELLER:
CH REALTY II/BEST, L.P.,
a Delaware limited partnership
By: CH Realty II/Best GP, L.L.C.,
a Delaware limited liability company,
its General Partner
By: Crow Holdings Managers, L.L.C.,
a Texas limited liability company,
its Manager
By: /s/ Xxxxxx X. XxXxxxx
---------------------------------
Name: Xxxxxx X. XxXxxxx
--------------------------------
Title: Vice President
-------------------------------
PURCHASER:
INLAND REAL ESTATE ACQUISITIONS, INC.,
an Illinois corporation
By: /s/ G. Xxxxxx Xxxxxxx
--------------------------------------------
Name: G. XXXXXX XXXXXXX
------------------------------------
Title: CHAIRMAN
-----------------------------------
Page 2
PURCHASE AND SALE AGREEMENT
BETWEEN
CH REALTY II/BEST, L.P.
AS SELLER
AND
INLAND REAL ESTATE ACQUISITIONS, INC.
AS PURCHASER
DATED 3/5/04, 2004
TABLE OF CONTENTS
Page No.
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ARTICLE 1 BASIC INFORMATION...............................................1
1.1 Certain Basic Terms.....................................................1
1.2 Closing Costs...........................................................3
1.3 Notice Addresses:.......................................................4
ARTICLE 2 PROPERTY........................................................4
2.1 Property................................................................4
ARTICLE 3 XXXXXXX MONEY...................................................6
3.1 Deposit and Investment of Xxxxxxx Money.................................6
3.2 Independent Consideration...............................................6
3.3 Form; Failure to Deposit................................................6
3.4 Disposition of Xxxxxxx Money............................................6
ARTICLE 4 DUE DILIGENCE...................................................7
4.1 Due Diligence Materials To Be Delivered.................................7
4.2 Due Diligence Materials To Be Made Available............................8
4.3 Physical Due Diligence..................................................8
4.4 Due Diligence/Termination Right.........................................8
4.5 Return of Documents and Reports.........................................9
4.6 Service Contracts.......................................................9
4.7 Proprietary Information; Confidentiality................................9
4.8 No Representation or Warranty by Seller................................10
4.9 Purchaser's Responsibilities...........................................10
4.10 Purchaser's Agreement to Indemnify.....................................10
4.11 Environmental Studies; Seller's Right to Terminate.....................11
ARTICLE 5 TITLE AND SURVEY...............................................11
5.1 Title Commitment.......................................................11
5.2 New or Updated Survey..................................................11
5.3 Title Review...........................................................11
5.4 Delivery of Title Policy at Closing....................................12
ARTICLE 6 OPERATIONS AND RISK OF LOSS....................................12
6.1 Ongoing Operations.....................................................12
6.2 Damage.................................................................13
6.3 Condemnation...........................................................13
ARTICLE 7 CLOSING........................................................14
7.1 Closing................................................................14
7.2 Conditions to Parties' Obligation to Close.............................14
7.3 Seller's Deliveries in Escrow..........................................15
7.4 Purchaser's Deliveries in Escrow.......................................16
i
TABLE OF CONTENTS
(CONTINUED)
Page No.
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7.5 Closing Statements.....................................................17
7.6 Purchase Price.........................................................17
7.7 Possession....................................................:........17
7.8 Delivery of Books and Records..........................................17
7.9 Notice to Tenants......................................................17
ARTICLE 8 PRORATIONS, DEPOSITS, COMMISSIONS..............................17
8.1 Prorations.............................................................17
8.2 Leasing Costs..........................................................19
8.3 Closing Costs..........................................................19
8.4 Final Adjustment After Closing.........................................19
8.5 Tenant Deposits........................................................20
8.6 Commissions............................................................20
8.7 Hollywood Video Escrow.................................................20
ARTICLE 9 REPRESENTATIONS AND WARRANTIES.................................20
9.1 Seller's Representations and Warranties................................20
9.2 Purchaser's Representations and Warranties.............................22
9.3 Survival of Representations and Warranties.............................22
ARTICLE 10 DEFAULT AND REMEDIES...........................................23
10.1 Seller's Remedies......................................................23
10.2 Purchaser's Remedies...................................................24
10.3 Attorneys' Fees........................................................24
10.4 Other Expenses.........................................................24
ARTICLE 11 DISCLAIMERS, RELEASE AND INDEMNITY.............................25
11.1 Disclaimers By Seller..................................................25
11.2 Sale "As Is, Where Is".................................................25
11.3 Seller Released from Liability.........................................26
11.4 "Hazardous Materials" Defined..........................................27
11.5 Indemnity..............................................................27
11.6 Survival...............................................................27
ARTICLE 12 MISCELLANEOUS..................................................27
12.1 Parties Bound; Assignment..............................................27
12.2 Headings...............................................................27
12.3 Invalidity and Waiver..................................................28
12.4 Governing Law..........................................................28
12.5 Survival...............................................................28
12.6 Entirety and Amendments................................................28
12.7 Time...................................................................28
12.8 Confidentiality........................................................28
12.9 No Electronic Transactions.............................................28
ii
TABLE OF CONTENTS
(CONTINUED)
Page No.
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12.10 Notices................................................................28
12.11 Construction...........................................................29
12.12 Calculation of Time Periods............................................29
12.13 Execution in Counterparts..............................................29
12.14 No Recordation.........................................................29
12.15 Further Assurances.....................................................30
12.16 Discharge of Obligations...............................................30
12.17 ERISA..................................................................30
12.18 No Third Party Beneficiary.............................................30
12.19 Reporting Person.......................................................30
12.20 Mandatory Arbitration..................................................30
12.21 Like-Kind Exchange.....................................................30
12.22 Post-Closing Audit.....................................................31
LIST OF DEFINED TERMS
Page No.
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Additional Property Information....................................................7
Agreement..........................................................................1
Assignment........................................................................15
Broker.............................................................................2
Casualty Notice...................................................................13
CERCLA............................................................................26
Closing...........................................................................14
Closing Date.......................................................................3
Code..............................................................................22
Deed..............................................................................15
Due Diligence Termination Notice...................................................8
Xxxxxxx Money......................................................................1
Effective Date.....................................................................2
ERISA.........................................................................16, 22
Escrow Agent.......................................................................2
Exchange..........................................................................30
Hazardous Materials...............................................................27
Improvements.......................................................................4
Independent Consideration..........................................................6
Inspection Period..................................................................2
Intangible Personal Property.......................................................5
Land...............................................................................4
Lease Files........................................................................7
iii
LIST OF DEFINED TERMS
(CONTINUED)
Page No.
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Leases.............................................................................5
Leasing Costs.....................................................................19
License Agreements.................................................................5
Material Damage...................................................................13
Materially Damaged................................................................13
Non-Refundable Deposit.............................................................6
OFAC..............................................................................22
Operating Statements...............................................................7
Permitted Exceptions..............................................................11
Permitted Outside Parties..........................................................9
Plan..............................................................................22
Property...........................................................................4
Property Documents.................................................................8
Property Information...............................................................7
Property Information Delivery Date.................................................2
Purchase Price.....................................................................1
Purchaser..........................................................................1
Real Property......................................................................4
Rent Roll..........................................................................7
Report.............................................................................9
Reports............................................................................9
Required Endorsements.............................................................12
Seller.............................................................................1
Seller's Representatives..........................................................23
Service Contracts..................................................................5
Survey............................................................................11
Survival Period...................................................................22
Tangible Personal Property.........................................................5
Taxes.............................................................................18
Tenant Receivables................................................................18
Title and Survey Review Period.....................................................2
Title Commitment..................................................................11
Title Commitment Delivery Date.....................................................2
Title Company......................................................................2
Title Policy......................................................................12
to Seller's knowledge.............................................................22
to the best of Seller's knowledge.................................................22
Unbilled Tenant Receivables.......................................................18
Uncollected Delinquent Tenant Receivables.........................................18
iv
PURCHASE AND SALE AGREEMENT
BEST ON THE BOULEVARD, LAS VEGAS, NEVADA
This
Purchase and Sale Agreement (this "AGREEMENT") is made and entered
into by and between Purchaser and Seller.
RECITALS
A. Defined terms are indicated by initial capital letters. Defined
terms shall have the meaning set forth herein, whether or not such terms are
used before or after the definitions are set forth.
B. Purchaser desires to purchase the Property and Seller desires to
sell the Property, all upon the terms and conditions set forth in this
Agreement.
NOW, THEREFORE, in consideration of the mutual terms, provisions, covenants
and agreements set forth herein, as well as the sums to be paid by Purchaser to
Seller, and for other good and valuable consideration, the receipt and
sufficiency of which are acknowledged, Purchaser and Seller agree as follows:
ARTICLE 1
BASIC INFORMATION
1.1 CERTAIN BASIC TERMS. The following defined terms shall have the
meanings set forth below:
1.1.1 SELLER: CH Realty II/Best, L.P.,
a Delaware limited partnership
1.1.2 PURCHASER: Inland Real Estate Acquisitions, Inc.,
an Illinois corporation
1.1.3 PURCHASE PRICE: $35,500,000.00
1.1.4 XXXXXXX MONEY: $350,000.00 [(THE "XXXXXXX MONEY")],
including interest thereon, to be
deposited in accordance with SECTION 3.1
below.
Page 1
1.1.5 TITLE COMPANY: Chicago Title Insurance Company
0000 Xxxxx Xxxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000-0000
Attn: Xxxxxxxx Xxxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000)000-0000
Email: xxxxxxxxxxx@xxx.xxx
1.1.6 ESCROW AGENT: Chicago Title Insurance Company
0000 Xxxxx Xxxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000-0000
Attn: Xxxxxxxx Xxxxxxxxx
Telephone: (000)000-0000
Facsimile: (000)000-0000
Email: xxxxxxxxxxx@xxx.xxx
1.1.7 BROKER: Marcus & Millichap,
a real estate investment brokerage
company
00000 XxxXxxxxx Xxxx., Xxxxx 000
Xxxxxx, Xxxxxxxxxx 00000-0000
1.1.8 EFFECTIVE DATE: The date on which this Agreement is
executed by the latter to sign of
Purchaser or Seller, as indicated on the
signature page of this Agreement. If the
execution date is left blank by either
Purchaser or Seller, the Effective Date
shall be the execution date inserted by
the other party.
1.1.9 PROPERTY February 26, 2004
INFORMATION
DELIVERY DATE:
1.1.10 TITLE COMMITMENT March 2, 2004.
DELIVERY DATE:
1.1.11 TITLE AND SURVEY The period ending on March 29, 2004.
REVIEW PERIOD:
1.1.12 INSPECTION PERIOD: The period beginning on February 26,
2004, and ending on March 29, 2004.
Page 2
1.1.13 CLOSING DATE: On or before 5:00 p.m., C.S.T., on
April 1, 2004.
1.2 CLOSING COSTS. Closing costs shall be allocated and paid as
follows:
COST RESPONSIBLE PARTY
--------------------------------------------------------------------------------
Title Commitment required to be delivered pursuant Seller
to SECTION 5.1
Premium for standard form Title Policy required to Seller
be delivered pursuant to SECTION 5.4
Premium for any upgrade of Title Policy for Purchaser
extended or additional coverage and any
endorsements desired by Purchaser, any inspection
fee charged by the Title Company, tax
certificates, municipal and utility lien
certificates, and any other Title Company charges
Costs of any revisions, modifications or Purchaser
recertifications to Survey delivered by Seller to
Purchaser
Costs for UCC Searches Seller
Recording Fees Purchaser
Any deed taxes, documentary stamps, transfer Seller
taxes, intangible taxes, mortgage taxes or other
similar taxes, fees or assessments
Any escrow fee charged by Escrow Agent for holding Purchaser 1/2
the Xxxxxxx Money or conducting the Closing Seller 1/2
Real Estate Sales Commission to Broker Seller
All other closing costs, expenses, charges and Purchaser/Seller
fees per custom
Page 3
1.3 NOTICE ADDRESSES:
Purchaser: Copy to:
Inland Real Estate Acquisitions, Inc. The Inland Real Estate Group, Inc.
0000 Xxxxxxxxxxx Xxxx 0000 Xxxxxxxxxxxx Xxxx
Xxx Xxxxx, XX 00000 Xxx Xxxxx, Xxxxxxxx 00000
Attention: G. Xxxxxx Xxxxxxx Attention: Xxxxxx Xxxxxxx, Esq.
Telephone: 000-000-0000 Telephone: 000-000-0000
Facsimile: 000-000-0000 Facsimile: 630-218-4900
E-mail: xxx@xxxxxxxxxxx.xxx E-mail: xxxxxxxx@xxxxxxxxxxx.xxx
Seller: Copy to:
CH Realty II/Best, X.X. Xxxx Holdings
c/o Crow Holdings 0000 XxXxxxxx Xxxxxx, Xxxxx 000
0000 XxXxxxxx Xxxxxx, Xxxxx 000 Xxxxxx, Xxxxx 00000
Xxxxxx, Xxxxx 00000 Attention: M. Xxxxx Xxxxxx
Attention: Xxx Xxxxxxx Telephone: 000-000-0000
Telephone: 000-000-0000 Facsimile: 000-000-0000
Facsimile: 000-000-0000 E-mail: xxxxxxx@xxxxxxxxxxxx.xxx
E-mail: xxxxxxxx@xxxxxxxxxxxx.xxx
Copy to:
Xxxx X. Xxxxx, Esq.
Winstead Xxxxxxxx & Xxxxxx P.C.
0000 Xxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Telephone: 000-000-0000
Facsimile: 000-000-0000
E-mail: xxxxxx@xxxxxxxx.xxx
ARTICLE 2
PROPERTY
2.1 PROPERTY. Subject to the terms and conditions of this Agreement,
Seller agrees to sell to Purchaser, and Purchaser agrees to purchase from
Seller, the following property (collectively, the "PROPERTY"):
2.1.1 REAL PROPERTY. The land described in EXHIBIT A attached
hereto (the "LAND"), together with (a) all improvements located thereon, but
expressly excluding improvements and structures owned by any tenant
("IMPROVEMENTS"), (b) without warranty, all right, title and interest of Seller,
if any, in and to the rights, benefits, privileges, easements, tenements,
hereditaments, and appurtenances thereon or in anywise appertaining thereto, and
(c) without warranty, all right, title, and interest of Seller, if any, in and
to all strips and gores and any land lying in the bed of any street, road or
alley, open or proposed, adjoining the Land (collectively, the "REAL PROPERTY").
Page 4
2.1.2 LEASES. All of Seller's right, title and interest, without
warranty other than as set forth herein, in all leases of the Real Property
(other than License Agreements), including leases which may be made by Seller
after the Effective Date and prior to Closing as permitted by this Agreement
(the "LEASES").
2.1.3 TANGIBLE PERSONAL PROPERTY. All of Seller's right, title and
interest, without warranty, in the equipment, machinery, furniture, furnishings,
supplies and other tangible personal property, if any, owned by Seller and now
or hereafter located in and used in connection with the operation, ownership or
management of the Real Property, but specifically excluding any items of
personal property owned or leased by Seller's property manager or tenants at or
on the Real Property and further excluding any items of personal property by
third parties and leased to Seller (collectively, the "TANGIBLE PERSONAL
PROPERTY").
2.1.4 INTANGIBLE PERSONAL PROPERTY. All of Seller's right, title
and interest, if any, without warranty, in all intangible personal property
related to the Real Property and the Improvements, including, without
limitation: all trade names and trade marks associated with the Real Property
and the Improvements, including Seller's rights and interests, if any, in the
name of the Real Property, the plans and specifications and other architectural
and engineering drawings for the Improvements, if any (to the extent assignable
without cost to Seller); contract rights related to the operation, ownership or
management of the Real Property, including maintenance, service, construction,
supply and equipment rental contracts, if any, but not including Leases or
License Agreements (collectively, the "SERVICE CONTRACTS") (but only to the
extent assignable without cost to Seller and Seller's obligations thereunder are
expressly assumed by Purchaser pursuant to this Agreement); warranties (to the
extent assignable without cost to Seller); governmental permits, approvals and
licenses, if any (to the extent assignable without cost to Seller); and
telephone exchange numbers (to the extent assignable without cost to Seller (all
of the items described in this SECTION 2.1.4 collectively referred to as the
"INTANGIBLE PERSONAL PROPERTY"). Tangible Personal Property and Intangible
Personal Property shall not include (a) any appraisals or other economic
evaluations of, or projections with respect to, all or any portion of the
Property, including, without limitation, budgets prepared by or on behalf of
Seller or any affiliate of Seller, (b) any documents, materials or information
which are subject to attorney/client, work product or similar privilege, which
constitute attorney communications with respect to the Property and/or Seller,
or which are subject to a confidentiality agreement, and (c) any trade name,
xxxx or other identifying material that includes the name "Xxxxxxxx Xxxx" or the
name "Crow Holdings" or any derivative thereof.
2.1.5 LICENSE AGREEMENTS. All of Seller's right, title and
interest, without warranty, in and to all agreements (other than Leases), if
any, for the leasing or licensing of rooftop space or equipment,
telecommunications equipment, cable access and other space, equipment and
facilities that are located on or within the Real Property and generate income
to Seller as the owner of the Real Property, including agreements which may be
made by Seller after the Effective Date and prior to Closing as permitted by
this Agreement (the "LICENSE AGREEMENTS"). Anything in this Agreement to the
contrary notwithstanding, Purchaser shall assume the obligations of the "lessor"
or "licensor" under all License Agreements, some or all of which may be
non-cancelable.
Page 5
ARTICLE 3
XXXXXXX MONEY
3.1 DEPOSIT AND INVESTMENT OF XXXXXXX MONEY. One (1) business day after
the Effective Date, Purchaser shall deposit the Xxxxxxx Money with Escrow Agent
into a joint order escrow. Escrow Agent shall invest the Xxxxxxx Money in
government insured interest-bearing accounts satisfactory to Seller and
Purchaser, shall not commingle the Xxxxxxx Money with any funds of Escrow Agent
or others, and shall promptly provide Purchaser and Seller with confirmation of
the investments made. Such account shall have no penalty for early withdrawal,
and as between Seller and Purchaser, Purchaser accepts all risks with regard to
such account.
3.2 INDEPENDENT CONSIDERATION. If Purchaser elects to terminate this
Agreement for any reason and is entitled to receive a return of the Xxxxxxx
Money pursuant to the terms hereof, the Escrow Agent shall first disburse to
Seller One Hundred and No/100 Dollars ($100.00) as independent consideration for
Seller's performance under this Agreement ("INDEPENDENT CONSIDERATION"), which
shall be retained by Seller in all instances.
3.3 FORM; FAILURE TO DEPOSIT. The Xxxxxxx Money shall be in the form of
a certified or cashier's check or the wire transfer to Escrow Agent of
immediately available U.S. federal funds. If Purchaser fails to timely deposit
any portion of the Xxxxxxx Money within the time periods required, Seller may
terminate this Agreement by written notice to Purchaser, in which event any
Xxxxxxx Money that has previously been deposited by Purchaser with Escrow Agent
shall be immediately delivered to Seller and thereafter the parties hereto shall
have no further rights or obligations hereunder, except for rights and
obligations which, by their terms, survive the termination hereof.
3.4 DISPOSITION OF XXXXXXX MONEY. The Xxxxxxx Money shall be applied as
a credit to the Purchase Price at Closing. However, if Purchaser elects to
terminate this Agreement prior to the expiration of the Inspection Period
pursuant to SECTION 4.4, Escrow Agent shall pay $100,000.00 of the Xxxxxxx Money
(the "NON-REFUNDABLE DEPOSIT") (less the Independent Consideration) to Seller,
and the balance of the Xxxxxxx Money to Purchaser one business day following
receipt of the Due Diligence Termination Notice from Purchaser (as long as the
current investment can be liquidated and disbursed in one business day). It is
the agreement of Purchaser and Seller that the Non-Refundable Deposit has been
earned by Seller as a result of awarding the bid to Purchaser and that such
Non-Refundable Deposit shall, in all instances, be payable to Seller hereunder,
(i) save and except for a failure of Seller to convey title to Purchaser in the
manner required hereby (including the provision of the title endorsement
described on EXHIBIT J to the extent such endorsements require any action or
payments) or (ii) a breach by Seller of any representation or warranty contained
in SECTION 9.1, which is either uncured by Seller or not otherwise waived by
Purchaser. No notice to Escrow Agent from Seller shall be required for the
release of the refundable portion of the Xxxxxxx Money to Purchaser by Escrow
Agent if Purchaser terminates this Agreement pursuant to SECTION 4.4. In the
event of a termination of this Agreement by either Seller or Purchaser for any
reason other than pursuant to SECTION 4.4, Escrow Agent is authorized to deliver
the Xxxxxxx Money to the party hereto entitled to same pursuant to the terms
hereof on or before the tenth business day following receipt by Escrow Agent and
the non-terminating party of written notice of such termination from the
terminating party, unless the other party hereto notifies Escrow Agent that it
disputes the right of
Page 6
the other party to receive the Xxxxxxx Money. In such event, Escrow Agent may
interplead the Xxxxxxx Money into a court of competent jurisdiction in the
county in which the Xxxxxxx Money has been deposited. All attorneys' fees and
costs and Escrow Agent's costs and expenses incurred in connection with such
interpleader shall be assessed against the party that is not awarded the Xxxxxxx
Money, or if the Xxxxxxx Money is distributed in part to both parties, then in
the inverse proportion of such distribution.
ARTICLE 4
DUE DILIGENCE
4.1 DUE DILIGENCE MATERIALS TO BE DELIVERED. Seller shall deliver to
Purchaser the following (the "PROPERTY INFORMATION") on or before the Property
Information Delivery Date:
4.1.1 RENT ROLL. A current rent roll ("RENT ROLL") for the
Property. Seller shall deliver an updated Rent Roll at Closing certified to its
knowledge to be true and complete.
4.1.2 FINANCIAL INFORMATION. Copy of operating statements and a
summary of capital expenditures pertaining to the Property for the 12 months
preceding the Effective Date or such lesser period as Seller has owned the
Property ("OPERATING STATEMENTS");
4.1.3 ENVIRONMENTAL REPORTS. Copy of any environmental reports or
site assessments related to the Property prepared for the benefit of Seller;
4.1.4 TAX STATEMENTS. Copy of ad valorem tax statements relating
to the Property for the current tax period;
4.1.5 TITLE AND SURVEY. Copy of Seller's most current title
insurance information and survey of the Property;
4.1.6 SERVICE CONTRACTS. A list, together with copies, of Service
Contracts;
4.1.7 PERSONAL PROPERTY. A list of Tangible Personal Property; and
4.1.8 LICENSE AGREEMENTS. A list, together with copies, of any
License Agreements.
4.1.9 LEASE FILES. The lease files for all tenants, including the
Leases, amendments, guaranties, any letter agreements and assignments which are
then in effect ("LEASE FILES");
4.1.10 LICENSES, PERMITS AND CERTIFICATES OF OCCUPANCY. Copies of
licenses, permits and certificates of occupancy relating to the Property to the
extent in Seller's possession.
Except for the Rent Roll contemplated in SECTION 4.1.4, Seller's
obligations to deliver the items listed in this SECTION 4.1 shall be limited to
the extent such items are in the possession of Seller or its property management
company.
Page 7
4.2 DUE DILIGENCE MATERIALS TO BE MADE AVAILABLE. To the extent such
items are in Seller's possession, Seller shall make available to Purchaser for
Purchaser's review, at Seller's option at either the offices of Seller's
property manager or at the Property, the following items and information (the
"ADDITIONAL PROPERTY INFORMATION") on or before the Property Information
Delivery Date, and Purchaser at its expense shall have the right to make copies
of same:
4.2.1 MAINTENANCE RECORDS AND WARRANTIES. Maintenance work orders
for the 12 months preceding the Effective Date and warranties, if any, on roofs,
air conditioning units, fixtures and equipment;
4.2.2 PLANS AND SPECIFICATIONS. Building plans and specifications
relating to the Property; and
4.3 PHYSICAL DUE DILIGENCE. Commencing on the Effective Date and
continuing until the Closing, Purchaser shall have reasonable access to the
Property at all reasonable times during normal business hours, upon appropriate
notice to tenants as permitted or required under the Leases, for the purpose of
conducting reasonably necessary tests, including surveys and architectural,
engineering, geotechnical and environmental inspections and tests, provided that
(a) Purchaser must give Seller one full business days' prior telephone or
written notice of any such inspection or test, and with respect to any intrusive
inspection or test (i.e., core sampling) or communication with tenants must
obtain Seller's prior written consent (which consent may be given, withheld or
conditioned in Seller's sole discretion), (b) prior to performing any inspection
or test, Purchaser must deliver a certificate of insurance to Seller evidencing
that Purchaser and its contractors, agents and representatives have in place
reasonable amounts of commercial general liability insurance and workers
compensation insurance for its activities on the Property in terms and amounts
reasonably satisfactory to Seller covering any accident arising in connection
with the presence of Purchaser, its contractors, agents and representatives on
the Property, which insurance shall name Seller as an additional insured
thereunder, and (c) all such tests shall be conducted by Purchaser in compliance
with Purchaser's responsibilities set forth in SECTION 4.9 below. Purchaser
shall bear the cost of all such inspections or tests and shall be responsible
for and act as the generator with respect to any wastes generated by those
tests. Subject to the provisions of SECTION 4.7 hereof, Purchaser or Purchaser's
representatives may meet with any tenant; provided, however, Purchaser must
contact Seller at least one full business day in advance by telephone to inform
Seller of Purchaser's intended meeting and to allow Seller the opportunity to
attend such meeting if Seller desires. Subject to the provisions of SECTION 4.7
hereof, Purchaser or Purchaser's representatives may meet with any governmental
authority for the sole purpose of gathering information in connection with the
transaction contemplated by this Agreement; provided, however, Purchaser must
contact Seller at least two full business days in advance by telephone to inform
Seller of Purchaser's intended meeting and to allow Seller the opportunity to
attend such meeting if Seller desires.
4.4 DUE DILIGENCE/TERMINATION RIGHT. Purchaser shall have through the
last day of the Inspection Period in which to (a) examine, inspect, and
investigate the Property Information and the Additional Property Information
(collectively, the "PROPERTY DOCUMENTS") and the Property and, in Purchaser's
sole and absolute judgment and discretion, determine whether the Property is
acceptable to Purchaser, (b) obtain all necessary internal approvals, and (c)
satisfy all
Page 8
other contingencies of Purchaser, Notwithstanding anything to the contrary in
this Agreement, Purchaser may terminate this Agreement for any reason or no
reason by giving written notice of termination to Seller and Escrow Agent (the
"DUE DILIGENCE TERMINATION NOTICE") on or before the last day of the Inspection
Period. If Purchaser does not give a Due Diligence Termination Notice, this
Agreement shall continue in full force and effect, Purchaser shall be deemed to
have waived its right to terminate this Agreement pursuant to this SECTION 4.4,
and Purchaser shall be deemed to have acknowledged that it has received or had
access to all Property Documents and conducted all inspections and tests of the
Property that it considers important.
4.5 RETURN OF DOCUMENTS AND REPORTS. As additional consideration for the
transaction contemplated herein, Purchaser shall provide to Seller, immediately
following receipt of same by Purchaser, copies of all third party reports,
investigations and studies, other than economic analyses (collectively, the
"REPORTS" and, individually, a "REPORT") prepared for Purchaser in connection
with its due diligence review of the Property, including, without limitation,
any and all Reports involving structural or geological conditions,
environmental, hazardous waste or hazardous substances contamination of the
Property, if any, which Reports shall be addressed to both Seller and Purchaser
at no cost to Seller. The Reports shall be delivered to Seller without any
representation or warranty as to the completeness or accuracy of the Reports or
any other matter relating thereto. Purchaser's obligation to deliver the
Property Documents and the Reports to Seller shall survive the termination of
this Agreement.
4.6 SERVICE CONTRACTS. On or prior to the last day of the Inspection
Period, Purchaser will advise Seller in writing of which Service Contracts it
will assume and for which Service Contracts Purchaser requests that Seller
deliver written termination at or prior to Closing, provided Seller shall have
no obligation to terminate, and Purchaser shall be obligated to assume, any
Service Contracts which by their terms cannot be terminated without penalty or
payment of a fee. Seller shall deliver at Closing notices of termination of all
Service Contracts that are not so assumed. Purchaser must assume the obligations
arising from and after the Closing Date under those Service Contracts (a) that
Purchaser has agreed to assume, or that Purchaser is obligated to assume
pursuant to this SECTION 4.6, and (b) for which a termination notice is
delivered as of or prior to Closing but for which termination is not effective
until after Closing.
4.7 PROPRIETARY INFORMATION; CONFIDENTIALITY. Purchaser acknowledges
that the Property Documents are proprietary and confidential and will be
delivered to Purchaser solely to assist Purchaser in determining the feasibility
of purchasing the Property. Purchaser shall not use the Property Documents for
any purpose other than as set forth in the preceding sentence. Purchaser shall
not disclose the contents to any person other than to those persons who are
responsible for determining the feasibility of Purchaser's acquisition of the
Property including, without limitation, engineers, environmental consultants,
and appraisers, as well as potential lenders, and who have agreed to preserve
the confidentiality of such information as required hereby (collectively,
"PERMITTED OUTSIDE PARTIES"). At any time and from time to time, within two
business days after Seller's request, Purchaser shall deliver to Seller a list
of all parties to whom Purchaser has provided any Property Documents or any
information taken from the Property Documents. Purchaser shall not divulge the
contents of the Property Documents and other information except in strict
accordance with the confidentiality standards set forth in this SECTION 4.7. In
permitting Purchaser to review the Property Documents or any other information,
Seller has not waived any privilege or claim of confidentiality with respect
thereto, and no third
Page 9
party benefits or relationships of any kind, either express or implied, have
been offered, intended or created.
4.8 NO REPRESENTATION OR WARRANTY BY SELLER. Purchaser acknowledges
that, except as expressly set forth in this Agreement, Seller has not made and
does not make any warranty or representation regarding the truth, accuracy or
completeness of the Property Documents or the source(s) thereof. Purchaser
further acknowledges that some if not all of the Property Documents were
prepared by third parties other than Seller. Seller expressly disclaims any and
all liability for representations or warranties, express or implied, statements
of fact and other matters contained in such information, or for omissions from
the Property Documents, or in any other written or oral communications
transmitted or made available to Purchaser. Purchaser shall rely solely upon its
own investigation with respect to the Property, including, without limitation,
the Property's physical, environmental or economic condition, compliance or lack
of compliance with any ordinance, order, permit or regulation or any other
attribute or matter relating thereto. Seller has not undertaken any independent
investigation as to the truth, accuracy or completeness of the Property
Documents and are providing the Property Documents solely as an accommodation to
Purchaser.
4.9 PURCHASER'S RESPONSIBILITIES. In conducting any inspections,
investigations or tests of the Property and/or Property Documents, Purchaser and
its agents and representatives shall: (a) not unreasonably disturb the tenants
or interfere with their use of the Property pursuant to their respective Leases;
(b) not unreasonably interfere with the operation and maintenance of the
Property; (c) not damage any part of the Property or any personal property owned
or held by any tenant or any third party; (d) not injure or otherwise cause
bodily harm to Seller or its agents, guests, invitees, contractors and employees
or any tenants or their guests or invitees; (e) comply with all applicable laws;
(f) promptly pay when due the costs of all tests, investigations, and
examinations done with regard to the Property; (g) not permit any liens to
attach to the Real Property by reason of the exercise of its rights hereunder;
(h) repair any damage to the Real Property resulting directly or indirectly from
any such inspection or tests; and (i) not reveal or disclose prior to Closing
any information obtained during the Inspection Period concerning the Property
and the Property Documents to anyone other than the Permitted Outside Parties,
in accordance with the confidentiality standards set forth in SECTION 4.7 above,
or except as may be otherwise required by law.
4.10 PURCHASER'S AGREEMENT TO INDEMNIFY. Purchaser hereby agrees to
indemnify, defend and hold Seller harmless from and against any and all liens,
claims, causes of action, damages, liabilities and expenses (including
reasonable attorneys' fees) arising out of Purchaser's inspections or tests
permitted under this Agreement or any violation of the provisions of SECTIONS
4.3, 4.7 and 4.9; provided, however, the indemnity shall not extend to protect
Seller from any pre-existing liabilities for matters merely discovered by
Purchaser (i.e., latent environmental contamination) so long as Purchaser's
actions do not aggravate any pre-existing liability of Seller. Purchaser also
hereby agrees to indemnify, defend and hold any tenant harmless from and against
any and all claims, causes of action, damages, liabilities and expenses which
such tenant may suffer or incur due to Purchaser's breach of its obligation
under SECTION 4.7 to maintain the confidential nature of any Property Documents
or other information relative to such tenant. Purchaser's obligations under this
SECTION 4.10 shall survive the termination of this Agreement and shall survive
the Closing.
Page 10
4.11 ENVIRONMENTAL STUDIES; SELLER'S RIGHT TO TERMINATE. As additional
consideration for the transaction contemplated in this Agreement, Purchaser must
provide to Seller, immediately following the receipt of same by Purchaser,
copies of any and all reports, tests or studies involving contamination of or
other environmental concerns relating to the Property; provided, however,
Purchaser shall have no obligation to cause any such tests or studies to be
performed on the Property. Seller acknowledges that Purchaser has not made and
does not make any warranty or representation regarding the truth or accuracy of
any such studies or reports. Notwithstanding SECTION 4.10, Purchaser shall have
no liability or culpability of any nature as a result of having provided such
information to Seller or as a result of Seller's reliance thereon or arising out
of the fact that Purchaser merely conducted such tests or studies, so long as
Purchaser's actions do not aggravate any pre-existing liability of Seller. In
the event that such reports, tests or studies indicate the existence or
reasonable potential existence of any contamination of any portion of the
Property that is not disclosed in the Property Documents and that is material
(meaning that the reasonably estimated cost of remediation and/or other
liability associated therewith, as determined by the parties' environmental
consultants, exceeds $125,000.00), then Seller may terminate this Agreement by
giving written notice to Purchaser within ten business days after Purchaser has
provided Seller with copies of such reports, tests or studies, whereupon the
Xxxxxxx Money shall be returned to Purchaser, the parties shall have no further
obligations hereunder except for obligations that expressly survive the
termination hereof.
ARTICLE 5
TITLE AND SURVEY
5.1 TITLE COMMITMENT. Seller has caused to be prepared and delivered to
Purchaser: (a) a current commitment for title insurance or preliminary title
report (the "TITLE COMMITMENT") issued by the Title Company, in the amount of
the Purchase Price and on an ALTA 1992 Standard Form commitment, with Purchaser
as the proposed insured, and (b) copies of all documents of record referred to
in the Title Commitment as exceptions to title to the Property.
5.2 NEW OR UPDATED SURVEY. Purchaser may elect to obtain a new survey or
revise, modify, or re-certify an existing survey ("SURVEY") as necessary in
order for the Title Company to delete the survey exception from the Title Policy
or to otherwise satisfy Purchaser's objectives.
5.3 TITLE REVIEW. During the Title and Survey Review Period, Purchaser
shall review title to the Property as disclosed by the Title Commitment and the
Survey. Seller shall have no obligation to cure title objections except
financing liens of an ascertainable amount created by, under or through Seller,
which liens Seller shall cause to be released at or prior to Closing (with
Seller having the right to apply the Purchase Price or a portion thereof for
such purpose), and Seller shall deliver the Property free and clear of any such
financing liens. Seller further agrees to remove any exceptions or encumbrances
to title which are voluntarily created by, under or through Seller after the
Effective Date without Purchaser's consent (if requested, such consent shall not
be unreasonably withheld or delayed). The term "PERMITTED EXCEPTIONS" shall
mean: the specific exceptions (excluding exceptions that are part of the
promulgated title insurance form) in the Title Commitment that the Title Company
has not agreed to remove from the Title Commitment as of the end of the Title
and Survey Review Period and that Seller is not required to remove as provided
above; matters created by, through or under Purchaser; items shown on
Page 11
the Survey which have not been removed as of the end of the Inspection Period
(or if Purchaser does not obtain a Survey, all matters that a current, accurate
survey of the Property would show); real estate taxes not yet due and payable;
rights of tenants under the Leases; rights of tenants or licensees under License
Agreements; and any licensees under any Service Contracts not terminated as of
Closing.
5.4 DELIVERY OF TITLE POLICY AT CLOSING. In the event that the Title
Company does not issue at Closing, or unconditionally commit at Closing to
issue, to Purchaser, an owner's title policy in accordance with the Title
Commitment, insuring Purchaser's title to the Property in the amount of the
Purchase Price, subject only to the standard exceptions and exclusions from
coverage contained in such policy, the Permitted Exceptions (the "TITLE POLICY")
and the "REQUIRED ENDORSEMENTS" (herein so called) set forth on EXHIBIT J
attached hereto, Purchaser shall have the right to terminate this Agreement, in
which case the Xxxxxxx Money shall be immediately returned to Purchaser and the
parties hereto shall have no further rights or obligations, other than those
that by their terms survive the termination of this Agreement.
ARTICLE 6
OPERATIONS AND RISK OF LOSS
6.1 ONGOING OPERATIONS. From the Effective Date through Closing:
6.1.1 LEASES, SERVICE CONTRACTS AND LICENSE AGREEMENTS. Seller
will perform its material obligations under the Leases, Service Contracts and
License Agreements.
6.1.2 NEW CONTRACTS. Except as provided in SECTION 6.1.4, Seller
will not enter into any contract that will be an obligation affecting the
Property subsequent to the Closing, except contracts entered into in the
ordinary course of business that are terminable without cause and without the
payment of any termination penalty on not more than 30 days' prior notice.
6.1.3 MAINTENANCE OF IMPROVEMENTS; REMOVAL OF PERSONAL PROPERTY.
Subject to SECTIONS 6.2 and 6.3, Seller shall maintain or cause the tenants
under the Leases to maintain all Improvements substantially in their present
condition (ordinary wear and tear and casualty excepted) and in a manner
consistent with Seller's maintenance of the Improvements during Seller's period
of ownership. Seller will not remove any Tangible Personal Property except as
may be required for necessary repair or replacement, and replacement shall be of
approximately equal quality and quantity as the removed item of Tangible
Personal Property.
6.1.4 LEASING; LICENSE AGREEMENTS. Seller will not amend or
terminate any existing Lease or License Agreement or enter into any new Lease or
new License Agreement without providing Purchaser (a) all relevant supporting
documentation, as reasonably determined by Seller, including, without
limitation, tenant financial information to the extent in Seller's possession,
and (b) as to any such amendment or termination of a Lease or License Agreement
or new Lease or new License Agreement which is to be executed after the
expiration of the Inspection Period, Seller's request for Purchaser's approval.
Purchaser agrees to give Seller written notice of approval or disapproval of a
proposed amendment or termination of a Lease or License Agreement or new Lease
or new License Agreement within three business days after Purchaser's receipt of
the items in SECTION 6.1.4. If Purchaser does not respond to Seller's request
Page 12
within such time period, then Purchaser will be deemed to have approved such
amendment, termination or new Lease or new License Agreement. With respect to a
request for approval delivered by Seller to Purchaser, Purchaser may withhold
its consent at its reasonable discretion, and Seller may not amend or terminate
a Lease or License Agreement or enter into a new Lease or new License Agreement
without Purchaser's written consent.
6.2 DAMAGE. If prior to Closing the Property is damaged by fire or other
casualty, Seller shall estimate the cost to repair and the time required to
complete repairs and will provide Purchaser written notice of Seller's
estimation (the "CASUALTY NOTICE") as soon as reasonably possible after the
occurrence of the casualty.
6.2.1 MATERIAL. In the event of any Material Damage to or
destruction of the Property or any portion thereof prior to Closing, Purchaser
may, at its option, terminate this Agreement by delivering written notice to
Seller on or before the expiration of 30 days after the date Seller delivers the
Casualty Notice to Purchaser (and if necessary, the Closing Date shall be
extended to give Purchaser the full thirty-day period to make such election and
to obtain insurance settlement agreements with Seller's insurers). Upon any such
termination, the Xxxxxxx Money shall be returned to Purchaser and the parties
hereto shall have no further rights or obligations hereunder, other than those
that by their terms survive the termination of this Agreement. If Purchaser does
not terminate this Agreement within said 30-day period, then the parties shall
proceed under this Agreement and close on schedule (subject to extension of
Closing as provided above), and as of Closing Seller shall assign to Purchaser,
without representation or warranty by or recourse against Seller, all of
Seller's rights in and to any resulting insurance proceeds (including any rent
loss insurance applicable to any period on and after the Closing Date) due
Seller as a result of such damage or destruction and Purchaser shall assume full
responsibility for all needed repairs, and Purchaser shall receive a credit at
Closing for any deductible amount under such insurance policies (but the amount
of the deductible plus insurance proceeds shall not exceed the lesser of (a) the
cost of repair or (b) the Purchase Price and a pro rata share of the rental or
business loss proceeds, if any). For the purposes of this Agreement, "MATERIAL
DAMAGE" and "MATERIALLY DAMAGED" means damage which, in Seller's reasonable
estimation, exceeds $750,000.00 to repair.
6.2.2 NOT MATERIAL. If the Property is not Materially Damaged,
then Purchaser shall have no right to terminate this Agreement, and Seller
shall, at its option, either (a) repair the damage before the Closing in a
manner reasonably satisfactory to Purchaser (and if necessary, Seller may extend
the Closing Date up to 30 days to complete such repairs), or (b) credit
Purchaser at Closing for the reasonable cost to complete the repair (in which
case Seller shall retain all insurance proceeds and Purchaser shall assume full
responsibility for all needed repairs).
6.3 CONDEMNATION. If proceedings in eminent domain are instituted, or if
Seller receives notice from any applicable governmental authority stating that
such proceedings will be initiated, with respect to the Property or any portion
thereof, Purchaser may, at its option, by written notice to Seller given within
ten days after Seller notifies Purchaser of such proceedings (and if necessary
the Closing Date shall be automatically extended to give Purchaser the full
ten-day period to make such election), either: (a) terminate this Agreement, in
which case the Xxxxxxx Money shall be immediately returned to Purchaser and the
parties hereto shall have no
Page 13
further rights or obligations, other than those that by their terms survive the
termination of this Agreement, or (b) proceed under this Agreement, in which
event Seller shall, at the Closing, assign to Purchaser its entire right, title
and interest in and to any condemnation award, and Purchaser shall have the sole
right after the Closing to negotiate and otherwise deal with the condemning
authority in respect of such matter. If Purchaser does not give Seller written
notice of its election within the time required above, then Purchaser shall be
deemed to have elected option (b) above.
ARTICLE 7
CLOSING
7.1 CLOSING. The consummation of the transaction contemplated herein
("CLOSING") shall occur on the Closing Date at the offices of Escrow Agent (or
such other location as may be mutually agreed upon by Seller and Purchaser).
Funds shall be deposited into and held by Escrow Agent in a closing escrow
account with a bank satisfactory to Purchaser and Seller. Upon satisfaction or
completion of all closing conditions and deliveries, the parties shall direct
Escrow Agent to immediately record and deliver the closing documents to the
appropriate parties and make disbursements according to the closing statements
executed by Seller and Purchaser.
7.2 CONDITIONS TO PARTIES' OBLIGATION TO CLOSE. In addition to all other
conditions set forth herein, the obligation of Seller, on the one hand, and
Purchaser, on the other hand, to consummate the transactions contemplated
hereunder are conditioned upon the following:
7.2.1 REPRESENTATIONS AND WARRANTIES. The other party's
representations and warranties contained herein shall be true and correct in all
material respects as of the Effective Date and the Closing Date, except for
representations and warranties made as of, or limited by, a specific date, which
will be true and correct in all material respects as of the specified date or as
limited by the specified date;
7.2.2 DELIVERIES. As of the Closing Date, the other party shall
have tendered all deliveries to be made at Closing; and
7.2.3 ACTIONS, SUITS, ETC. There shall exist no pending or
threatened actions, suits, arbitrations, claims, attachments, proceedings,
assignments for the benefit of creditors, insolvency, bankruptcy, reorganization
or other proceedings, against the other party that would materially and
adversely affect the operation or value of the Property or the other party's
ability to perform its obligations under this Agreement.
So long as a party is not in default hereunder, if any condition to such
party's obligation to proceed with the Closing hereunder has not been satisfied
as of the Closing Date (or such earlier date as is provided herein), subject to
any applicable notice and cure periods provided in SECTIONS 10.1 and 10.2, such
party may, in its sole discretion, terminate this Agreement by delivering
written notice to the other party on or before the Closing Date (or such earlier
date as is provided herein), or elect to close (or to permit any such earlier
termination deadline to pass) notwithstanding the non-satisfaction of such
condition, in which event such party shall be deemed to have waived any such
condition. In the event such party elects to close (or to permit any such
earlier termination deadline to pass), notwithstanding the non-satisfaction of
such
Page 14
condition, said party shall be deemed to have waived said condition, and there
shall be no liability on the part of any other party hereto for breaches of
representations and warranties of which the party electing to close had
knowledge at the Closing.
7.3 SELLER'S DELIVERIES IN ESCROW. As of or prior to the Closing Date,
Seller shall deliver in escrow to Escrow Agent the following:
7.3.1 DEED. A special warranty deed in the form of EXHIBIT B
hereto (or other limited warranty deed, as Seller's local counsel or Title
Company shall advise, warranting title only against any party claiming by,
through or under Seller) in form acceptable for recordation under the law of the
state where the Property is located and restating the provisions of ARTICLE 11
hereof and including a list of Permitted Exceptions to which the conveyance
shall be subject, executed and acknowledged by Seller, conveying to Purchaser
Seller's interest in the Real Property (the "DEED"):
7.3.2 XXXX OF SALE, ASSIGNMENT AND ASSUMPTION. A Xxxx of Sale,
Assignment and Assumption of Contracts and an Assignment and Assumption of
Leases in the form of EXHIBIT C-1 and EXHIBIT C-2, respectively, attached hereto
(collectively, the "ASSIGNMENT"), executed and acknowledged by Seller, vesting
in Purchaser, without warranty other than as set forth herein, Seller's right,
title and interest in and to the property described therein free of any claims,
except for the Permitted Exceptions to the extent applicable;
7.3.3 CONVEYANCING OR TRANSFER TAX FORMS OR RETURNS. Such
conveyancing or transfer tax forms or returns, if any, as are required to be
delivered or signed by Seller by applicable state and local law in connection
with the conveyance of the Real Property;
7.3.4 FIRPTA. A Foreign Investment in Real Property Tax Act
affidavit in the form of EXHIBIT D hereto executed by Seller;
7.3.5 AUTHORITY. Evidence of the existence, organization and
authority of Seller and of the authority of the persons executing documents on
behalf of Seller reasonably satisfactory to the underwriter for the Title
Policy;
7.3.6 ADDITIONAL DOCUMENTS. Any additional documents that Escrow
Agent or the Title Company may reasonably require for the proper consummation of
the transaction contemplated by this Agreement (provided, however, no such
additional document shall expand any obligation, covenant, representation or
warranty of Seller or result in any new or additional obligation, covenant,
representation or warranty of Seller under this Agreement beyond those expressly
set forth in this Agreement); and
7.3.7 TENANT ESTOPPEL CERTIFICATES. Tenant Estoppel Certificates
substantially in the form of EXHIBIT G-1 (or, if a tenant's Lease specifies or
contemplates another form of tenant estoppel certificate, then such other
specified or contemplated form) executed by tenants occupying not less than 90%
of the square feet in the Improvements leased to tenants, but which must in all
events include Cost Plus, World Market and Pier I Imports. Seller shall not be
obligated to expend any funds in connection with obtaining any such tenant
estoppel certificates, and the failure of Seller to obtain any such tenant
estoppel certificates shall not be a breach or default hereunder. Seller shall
use commercially reasonable efforts to reconcile factual
Page 15
discrepancies between the Tenant Estoppel Certificates and the Lease Files and
Rent Roll so long as Seller is not obligated to incur costs to do so. If Seller
is unable to deliver the tenant estoppel certificates referred to in this
SECTION 7.3.7 in the manner and time frames required hereby, including
reconciliation of the same in the manner described above, then Purchaser's sole
remedies and recourses shall be limited to either (a) waiving the requirement
for the tenant estoppel certificate(s) in question and proceeding to Closing
without reduction of the Purchase Price or (b) terminating this Agreement by
immediate notification to Seller, in which event this Agreement shall be
terminated as provided for in SECTION 10.2 even if it is determined that the
Tenant Estoppel Certificates cannot be obtained following the expiration of the
Inspection Period. Either decision must be made within three (3) business days
of receipt of the Tenant Estoppel Certificates or Purchaser will be deemed to
have elected to proceed under (a) above. The parties further agree that Seller
may extend the Closing for a period of up to but not in excess of fifteen (15)
days in order to permit Seller additional time to secure the requested Tenant
Estoppel Certificates and in such instance Purchaser cannot terminate until the
expiration of the aforesaid fifteen (15) day period.
7.3.8 DECLARATION ESTOPPEL CERTIFICATE. Declaration Estoppel
Certificate substantially in the form of EXHIBIT G-2 executed by the Declarant
under that certain instrument entitled "Best on the Boulevard Shopping Center
Grant of Reciprocal Easements and Declaration of Restrictions" dated November
30, 1994, recorded on December 9, 1994, in Book 941209, Document No. 01660 of
the Official Records of Xxxxx County, Nevada affecting Parcels 1, 3 and 4.
Seller shall not be obligated to expend any funds in connection with obtaining
any such Declaration Estoppel Certificate, and the failure of Seller to obtain
any such Declaration Estoppel Certificate shall not be a breach or default
hereunder. If Seller is unable to deliver the Declaration Estoppel Certificate
referred to in this SECTION 7.3.8, then Purchaser's sole remedies and recourses
shall be limited to either (a) waiving the requirement for the Declaration
Estoppel Certificate in question and proceeding to Closing without reduction of
the Purchase Price or (b) terminating this Agreement by immediate notification
to Seller, in which event this Agreement shall be terminated as provided for in
SECTION 10.2. Either decision must be made within three (3) business days of
receipt of the Declaration Estoppel Certificate or Purchaser will be deemed to
have elected to proceed under (a) above. The parties further agree that Seller
may extend the Closing for a period of up to but not in excess of fifteen (15)
days in order to permit Seller additional time to secure the requested
Declaration Estoppel Certificate.
7.4 PURCHASER'S DELIVERIES IN ESCROW. As of or prior to the Closing
Date, Purchaser shall deliver in escrow to Escrow Agent the following:
7.4.1 XXXX OF SALE, ASSIGNMENT AND ASSUMPTION. The Assignment,
executed and acknowledged by Purchaser;
7.4.2 ERISA LETTER. A letter to Seller in the form of EXHIBIT E
attached hereto duly executed by Purchaser, confirming that Purchaser is not
acquiring the Property with the assets of an employee benefit plan as defined in
Section 3(3) of the Employee Retirement Income Security Act of 1974 ("ERISA")
and, in the event Purchaser is unable or unwilling to make such a
representation, Purchaser shall be deemed to be in default hereunder, and Seller
shall have the right to terminate this Agreement and to receive and retain the
Xxxxxxx Money;
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7.4.3 CONVEYANCING OR TRANSFER TAX FORMS OR RETURNS. Such
conveyancing or transfer tax forms or returns, if any, as are required to be
delivered or signed by Purchaser by applicable state and local law in connection
with the conveyance of Real Property;
7.4.4 AUTHORITY. Evidence of the existence, organization and
authority of Purchaser and of the authority of the persons executing documents
on behalf of Purchaser reasonably satisfactory to the underwriter for the Title
Policy; and
7.4.5 ADDITIONAL DOCUMENTS. Any additional documents that Seller,
Escrow Agent or the Title Company may reasonably require for the proper
consummation of the transaction contemplated by this Agreement (provided,
however, no such additional document shall expand any obligation, covenant,
representation or warranty of Purchaser or result in any new or additional
obligation, covenant, representation or warranty of Purchaser under this
Agreement beyond those expressly set forth in this Agreement).
7.5 CLOSING STATEMENTS. As of or prior to the Closing Date, Seller and
Purchaser shall deposit with Escrow Agent executed closing statements consistent
with this Agreement in the form required by Escrow Agent.
7.6 PURCHASE PRICE. At or before 1:00 p.m. local time on the Closing
Date, Purchaser shall deliver to Escrow Agent the Purchase Price, less the
Xxxxxxx Money that is applied to the Purchase Price, plus or minus applicable
prorations, in immediate, same-day U.S. federal funds wired for credit into
Escrow Agent's escrow account, which funds must be delivered in a manner to
permit Escrow Agent to deliver good funds to Seller or its designee on the
Closing Date (and, if requested by Seller, by wire transfer); in the event that
Escrow Agent is unable to deliver good funds to Seller or its designee on the
Closing Date, then the closing statements and related prorations will be revised
as necessary.
7.7 POSSESSION. Seller shall deliver possession of the Property to
Purchaser at the Closing subject only to the Permitted Exceptions.
7.8 DELIVERY OF BOOKS AND RECORDS. After the Closing, Seller shall
deliver to the offices of Purchaser's property manager or to the Real Property
to the extent in Seller's or its property manager's possession or control: Lease
Files; License Agreements; maintenance records and warranties; plans and
specifications; licenses, permits and certificates of occupancy; copies or
originals of all books and records of account, contracts, and copies of
correspondence with tenants and suppliers; all advertising materials; booklets;
and keys.
7.9 NOTICE TO TENANTS. Seller and Purchaser shall each execute, and
Purchaser shall deliver to each tenant immediately after the Closing, a notice
regarding the sale in substantially the form of EXHIBIT F attached hereto, or
such other form as may be required by applicable state law. This obligation on
the part of Purchaser shall survive the Closing.
ARTICLE 8
PRORATIONS, DEPOSITS, COMMISSIONS
8.1 PRORATIONS. At Closing, the following items shall be prorated as of
the date of Closing with all items of income and expense for the Property being
borne by Purchaser from
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and after (and including) the date of Closing: "Tenant Receivables" and
"Credits" (as each is defined below) and other income and rents that have been
collected by Seller as of Closing; fees and assessments; prepaid expenses and
obligations under Service Contracts; accrued operating expenses; real and
personal ad valorem taxes ("TAXES"); and any assessments by private covenant for
the then-current calendar year of Closing. Specifically, the following shall
apply to such prorations and to post-Closing collections of Tenant Receivables:
8.1.1 TAXES. If Taxes for the year of Closing are not known or
cannot be reasonably estimated, Taxes shall be prorated based on Taxes for the
year prior to Closing.
8.1.2 UTILITIES. Purchaser shall take all steps necessary to
effectuate the transfer of all utilities to its name as of the Closing Date, and
where necessary, post deposits with the utility companies. Seller shall ensure
that all utility meters are read as of the Closing Date. Seller shall be
entitled to recover any and all deposits held by any utility company as of the
Closing Date.
8.1.3 TENANT RECEIVABLES AND CREDITS. Rents due from tenants under
Leases and from tenants or licensees under License Agreements and operating
expenses and/or taxes payable by tenants under Leases (collectively, "TENANT
RECEIVABLES") and not collected by Seller as of Closing shall not be prorated
between Seller and Purchaser at Closing but shall be apportioned on the basis of
the period for which the same is payable and if, as and when collected, as
follows:
(a) Tenant Receivables and other income received from
tenants under Leases and/or tenants or licensees under License Agreements
after Closing shall be applied in the following order of priority: (A)
first, to payment of the current Tenant Receivables then due for the month
in which the Closing Date occurs, which amount shall be apportioned between
Purchaser and Seller as of the Closing Date as set forth in SECTION 8.1
hereof (with Seller's portion thereof to be delivered to Seller); (B)
second, to payment of Tenant Receivables first coming due after Closing but
applicable to the period of time before Closing, including, without
limitation, the Tenant Receivables described in SECTION 8.1.3(b)
(collectively, "UNBILLED TENANT RECEIVABLES"), which amount shall be
delivered to Seller; (C) third, to Tenant Receivables first coming due
after Closing and applicable to the period of time after Closing, which
amount shall be retained by Purchaser; and (D) thereafter, to delinquent
Tenant Receivables which were due and payable as of Closing but not
collected by Seller as of Closing (collectively, "UNCOLLECTED DELINQUENT
TENANT RECEIVABLES"), which amount shall be delivered to Seller.
Notwithstanding the foregoing, Seller shall have the right to pursue the
collection of Uncollected Delinquent Tenant Receivables for a period of one
year after Closing without prejudice to Seller's rights or Purchaser's
obligations hereunder, provided, however, Seller shall have no right to
cause any such tenant or licensee to be evicted or to exercise any other
"landlord" remedy (as set forth in such tenant's Lease or licensee's
License Agreement) against such tenant other than to xxx for collection.
Any sums received by Purchaser to which Seller is entitled shall be held in
trust for Seller on account of such past due rents payable to Seller, and
Purchaser shall remit to Seller any such sums received by Purchaser to
which Seller is entitled within ten business days after receipt thereof
less reasonable, actual costs and expenses of collection, including
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reasonable attorneys' fees, court costs and disbursements, if any. Seller
expressly agrees that if Seller receives any amounts after the Closing Date
which are attributable, in whole or in part, to any period after the
Closing Date, Seller shall remit to Purchaser that portion of the monies so
received by Seller to which Purchaser is entitled within ten business days
after receipt thereof. With respect to Unbilled Tenant Receivables,
Purchaser covenants and agrees to (A) xxxx the same when billable and (B)
cooperate with Seller to determine the correct amount of operating expenses
and/or taxes due. The provisions of this SECTION 8.1.3(a) shall survive the
Closing.
(b) If the final reconciliation or determination of
operating expenses and/or taxes due under the Leases shows that a net
amount is owed by Seller to Purchaser, said amount shall be paid by Seller
to Purchaser within ten business days of such final determination under the
Leases. If the final determination of operating expenses and/or taxes due
under the Leases shows that a net amount is owed by Purchaser to Seller,
Purchaser shall, within ten business days of such final determination,
remit said amount to Seller to the extent monies have been received by
Purchaser from the tenant(s) in question. Purchaser agrees to receive and
hold any monies received on account of such past due expenses and/or taxes
in trust for Seller and to pay same promptly to Seller as aforesaid. The
provisions of this SECTION 8.1.3(b) shall survive the Closing.
8.2 LEASING COSTS. Seller agrees to pay or discharge at or prior to
Closing all leasing commissions, costs for tenant improvements, lease buyout
costs, moving allowances, design allowances, legal fees and other costs,
expenses and allowances incurred or accrued in order to induce a tenant to enter
into a Lease or Lease renewal or extension or to induce a licensee to enter into
a License Agreement (collectively, "LEASING COSTS") that are due and payable
prior to Closing with respect to Leases and License Agreements in force as of or
prior to the Effective Date; provided, however, that Seller shall have no
obligation to pay, and as of Closing Purchaser shall assume the obligation to
pay, all Leasing Costs payable with respect to any option to renew or option to
expand that has not been exercised prior to the Effective Date, which obligation
shall survive the Closing, Additionally, as of Closing, Purchaser shall assume
Seller's obligations for (a) Leasing Costs that are due and payable after
Closing with respect to Leases and License Agreements in force as of or prior to
the Effective Date, and (b) Leasing Costs incurred with respect to Leases and
Lease renewals and extensions and License Agreements and License Agreement
renewals and extensions executed subsequent to the Effective Date.
8.3 CLOSING COSTS. Closing costs shall be allocated between Seller and
Purchaser in accordance with SECTION 1.2.
8.4 FINAL ADJUSTMENT AFTER CLOSING. If final bills are not available or
cannot be issued prior to Closing for any item being prorated under SECTION 8.1,
then Purchaser and Seller agree to allocate such items on a fair and equitable
basis as soon as such bills are available, final adjustment to be made as soon
as reasonably possible after the Closing. Payments in connection with the final
adjustment shall be due within 30 days of written notice. All such rights and
obligations shall survive the Closing.
Page 19
8.5 TENANT DEPOSITS. All tenant and licensee security deposits collected
and not applied by Seller (and interest thereon if required by law or contract)
shall be transferred or credited to Purchaser at Closing, As of the Closing,
Purchaser shall assume Seller's obligations related to tenant and licensee
security deposits, but only to the extent they are credited or transferred to
Purchaser.
8.6 COMMISSIONS. Seller shall be responsible to Broker for a real estate
sales commission at Closing (but only in the event of a Closing in strict
accordance with this Agreement) in accordance with a separate agreement between
Seller and Broker. Broker may share its commission with any other licensed
broker involved in this transaction, but the payment of the commission by Seller
to Broker shall fully satisfy any obligations of Seller to pay a commission
hereunder. Under no circumstances shall Seller owe a commission or other
compensation directly to any other broker, agent or person. Any cooperating
broker shall not be an affiliate, subsidiary or related in any way to Purchaser.
Other than as stated above in this SECTION 8.6, Seller and Purchaser each
represent and warrant to the other that no real estate brokerage commission is
payable to any person or entity in connection with the transaction contemplated
hereby, and each agrees to and does hereby indemnify and hold the other harmless
against the payment of any commission to any other person or entity claiming by,
through or under Seller or Purchaser, as applicable. This indemnification shall
extend to any and all claims, liabilities, costs and expenses (including
reasonable attorneys' fees and litigation costs) arising as a result of such
claims and shall survive the Closing.
8.7 HOLLYWOOD VIDEO ESCROW. Unless Hollywood Video has executed the
lease, taken occupancy and commenced paying rent by Closing, then Seller will
escrow with the Title Company as applicable (i) the full amount of Tenant
Improvements and Commission monies required by the executed lease or the pro
forma sums specified in the lease being negotiated, and (ii) the rental
(including any applicable CAM or similar charges including taxes and insurance
specified in the lease or pro forma, which for purposes hereof are hereafter
referred to as "RENT") for the first 365 days of the term. It is the agreement
of the parties that the Tenant Improvement and Commission monies may be
disbursed by the Title Company and expended as required by the lease, and the
monies evidencing the Rent otherwise due under the lease will be prorated for
the month of Closing at Closing and thereafter disbursed by the Title Company
commencing on the first day of the first month following Closing on a monthly
basis to Purchaser until the earlier to occur of the expiration of 365 days or
the commencement of the payment of Rent by Hollywood Video. At such time as
Hollywood Video commences paying Rent, any and all monies remaining in the
escrow shall be disbursed by the Title Company to Seller without the requirement
of further consent from Purchaser. The terms and provisions of the applicable
escrow documentation will be finalized during the Inspection Period.
ARTICLE 9
REPRESENTATIONS AND WARRANTIES
9.1 SELLER'S REPRESENTATIONS AND WARRANTIES. Seller represents and
warrants to Purchaser that:
9.1.1 ORGANIZATION AND AUTHORITY. Seller has been duly organized,
is validly existing, and is in good standing in the state in which it was
formed. Seller has the full right and
Page 20
authority and has obtained any and all consents required to enter into this
Agreement and to consummate or cause to be consummated the transactions
contemplated hereby. This Agreement has been, and all of the documents to be
delivered by Seller at the Closing will be, authorized and executed and
constitute, or will constitute, as appropriate, the valid and binding obligation
of Seller, enforceable in accordance with their terms.
9.1.2 CONFLICTS AND PENDING ACTIONS. There is no agreement to
which Seller is a party or, to Seller's knowledge, that is binding on Seller
which is in conflict with this Agreement. To Seller's knowledge, there is no
action or proceeding pending or threatened against Seller or relating to the
Property, which challenges or impairs Seller's ability to execute or perform its
obligations under this Agreement.
9.1.3 TENANT LEASES. As of the Effective Date, EXHIBIT H lists all
tenants of the Property and the Lease Files include leases and amendments. The
Lease Files are true, correct, and complete as to the matters in Seller's
possession. To Seller's knowledge, except as disclosed on the Lease Files, no
tenant is in default, except as reflected therein, all tenants are in possession
and paying rent, and no concessions are required to be paid to tenants following
Closing. Seller has received no written notice from any tenant claiming default
by Seller or requesting rent concessions, offset, or abatement.
9.1.4 SERVICE CONTRACTS AND LICENSE AGREEMENTS. To Seller's
knowledge, the list of Service Contracts and License Agreements to be delivered
to Purchaser pursuant to this Agreement will be correct and complete as of the
date of its delivery.
9.1.5 NOTICES FROM GOVERNMENTAL AUTHORITIES. To Seller's
knowledge, Seller has not received from any governmental authority written
notice of any material violation of any laws applicable (or alleged to be
applicable) to the Real Property, or any part thereof, that has not been
corrected, except as may be reflected by the Property Documents or otherwise
disclosed in writing to Purchaser nor has Seller received notice from any
governmental authority stating that the Real Property would be subject to a
special assessment except as may be included in the Property Documents or Title
Commitment.
9.1.6 CONDEMNATION. To Seller's knowledge, no condemnation or
similar proceedings have been instituted or threatened against the Land or any
part thereof, and Seller has not received notice of any such proceedings.
9.1.7 FINANCIAL COVENANT. For a period of not less than six months
following closing, Seller will maintain a net worth of not less than
$250,000.00.
9.1.8 NOTICES OF ENVIRONMENTAL LIENS OR VIOLATIONS. To Seller's
knowledge, Seller has not received from any governmental authority written
notice of any violation of any applicable environmental laws (or alleged to be
applicable) or environmental liens relating to the Real Property, or any part
thereof, except as may be reflected by the Property Documents or otherwise
disclosed in writing to Purchaser.
Page 21
9.2 PURCHASER'S REPRESENTATIONS AND WARRANTIES. Purchaser represents and
warrants to Seller that:
9.2.1 ORGANIZATION AND AUTHORITY. Purchaser has been duly
organized and is validly existing as a corporation in good standing in the State
of Illinois and is qualified to do business in the state in which the Real
Property is located. Purchaser has the full right and authority and has obtained
any and all consents required to enter into this Agreement and to consummate or
cause to be consummated the transactions contemplated hereby. This Agreement has
been, and all of the documents to be delivered by Purchaser at the Closing will
be, authorized and properly executed and constitute, or will constitute, as
appropriate, the valid and binding obligation of Purchaser, enforceable in
accordance with their terms.
9.2.2 CONFLICTS AND PENDING ACTION. There is no agreement to which
Purchaser is a party or to Purchaser's knowledge binding on Purchaser which is
in conflict with this Agreement. There is no action or proceeding pending or, to
Purchaser's knowledge, threatened against Purchaser which challenges or impairs
Purchaser's ability to execute or perform its obligations under this Agreement.
9.2.3 ERISA. Purchaser is not an employee benefit plan (a "PLAN")
subject to the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), or Section 4975 of the Internal Revenue Code of 1986, as amended (the
"CODE"), assets of a Plan are not being used to acquire the Property, Purchaser
is not a "party in interest" (as that term is defined in Section 3(14) of ERISA)
with respect to any Plan that is an investor in Seller, and Purchaser's
acquisition of the Property will not constitute or result in a prohibited
transaction under Section 406 of ERISA or Section 4975 of the Code.
9.2.4 PROHIBITED PERSONS AND TRANSACTIONS. Neither Purchaser nor
any of its affiliates, nor any of their respective partners, members,
shareholders or other equity owners, and none of their respective employees,
officers, directors, representatives or agents is, nor will they become, a
person or entity with whom U.S. persons or entities are restricted from doing
business under regulations of the Office of Foreign Asset Control ("OFAC") of
the Department of the Treasury (including those named on OFAC's Specially
Designated and Blocked Persons List) or under any statute, executive order
(including the September 24, 2001, Executive Order Blocking Property and
Prohibiting Transactions with Persons Who Commit, Threaten to Commit, or Support
Terrorism), or other governmental action and is not and will not engage in any
dealings or transactions or be otherwise associated with such persons or
entities.
9.2.5 NO FINANCING CONTINGENCY. Purchaser represents and warrants,
and confirms, to Seller that its obligations hereunder are expressly not
contingent upon the securing of financing in order to consummate the transaction
contemplated hereby within the time frames specified herein. Purchaser further
warrants that it has cash sufficient to consummate the transaction contemplated
hereby. Therefore, Purchaser has no rights to either terminate this Agreement as
a result of financing contingency or to extend the date of Closing as a result
of its need to comply with the requirements of a loan or equity source.
9.3 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. The representations and
warranties set forth in this Agreement are made as of the Effective Date and are
remade as of the Closing Date and shall not be deemed to be merged into or
waived by the instruments of Closing, but shall survive the Closing for a period
of nine months (the "SURVIVAL PERIOD"). Terms such as "TO SELLERS KNOWLEDGE,"
"TO THE BEST OF SELLER'S KNOWLEDGE" or like phrases mean the actual
Page 22
present and conscious awareness or knowledge of Xxx Xxxxxxx ("SELLER'S
REPRESENTATIVES"), without any duty of inquiry or investigation; provided that
so qualifying Seller's knowledge shall in no event give rise to any personal
liability on the part of Seller's Representatives, or any of them, or any other
officer or employee of Seller, on account of any breach of any representation or
warranty made by Seller herein. Said terms do not include constructive
knowledge, imputed knowledge, or knowledge Seller or such persons do not have
but could have obtained through further investigation or inquiry. No broker,
agent, or party other than Seller is authorized to make any representation or
warranty for or on behalf of Seller. Each party shall have the right to bring an
action against the other on the breach of a representation or warranty
hereunder, but only on the following conditions: (a) the party bringing the
action for breach first learns of the breach after Closing, and (b) neither
party shall have the right to bring a cause of action for a breach of a
representation or warranty unless the damage to such party on account of such
breach (individually or when combined with damages from other breaches) equals
or exceeds $10,000.00. Neither party shall have any liability after Closing for
the breach of a representation or warranty hereunder of which the other party
hereto had knowledge as of Closing. Notwithstanding any other provision of this
Agreement, any agreement contemplated by this Agreement, or any rights which
Purchaser might otherwise have at law, equity, or by statute, whether based on
contract or some other claim, Purchaser agrees that any liability of Seller to
Purchaser will be limited to $500,000.00. The provisions of this SECTION 9.3
shall survive the Closing. Any breach of a representation or warranty that
occurs prior to Closing shall be governed by ARTICLE 10.
ARTICLE 10
DEFAULT AND REMEDIES
10.1 SELLER'S REMEDIES. If Purchaser fails to consummate the purchase of
the Property pursuant to this Agreement as a result of Purchaser's default
hereunder, Seller shall be entitled, as its sole remedy, to terminate this
Agreement and recover the Xxxxxxx Money as liquidated damages and not as
penalty, in full satisfaction of claims against Purchaser hereunder. Seller and
Purchaser agree that Seller's damages resulting from Purchaser's failure to
consummate the purchase of the Property are difficult, if not impossible, to
determine and the Xxxxxxx Money is a fair estimate of those damages, which has
been agreed to in an effort to cause the amount of such damages to be certain.
If Purchaser defaults on its obligations hereunder at or prior to Closing other
than failing to consummate the purchase of the Property pursuant to this
Agreement, or if prior to Closing any one or more of Purchaser's representations
or warranties are breached in any material respect, and such default or breach
is not cured by the earlier of the third (3rd) business day after written notice
thereof from Seller or the Closing Date (except no notice or cure period shall
apply if Purchaser fails to consummate the purchase of the Property hereunder),
then INLAND REAL ESTATE ACQUISITIONS, INC., an Illinois corporation, shall be
liable to Seller for any and all claims, demands, liabilities (including strict
liability), losses, damages (including consequential damages), causes of action,
judgments, penalties, fines, costs and expenses (including fees, costs and
expenses of attorneys, consultants, contractors, experts and laboratories), of
any and every kind of character, contingent or otherwise, matured or unmatured,
known or unknown, forseeable or unforeseeable, whether or not ultimately
defeated, and the settlement of any claim or judgment including all value paid
or given in settlement as a result of such default. Notwithstanding anything in
this SECTION 10.1 or in EXHIBIT I to the contrary, in the event of Purchaser's
default or a termination of this Agreement, Seller shall have all remedies
Page 23
available at law or in equity in the event Purchaser or any party related to or
affiliated with Purchaser is asserting any claims or right to the Property that
would otherwise delay or prevent Seller from having clear, indefeasible and
marketable title to the Property, and in said event Seller shall not be required
to submit such matter to arbitration as contemplated by EXHIBIT I. If Closing is
consummated, Seller shall have all remedies available at law or in equity in the
event Purchaser fails to perform any obligation of Purchaser under this
Agreement not cured by Purchaser within three (3) business days after written
notice from Seller to Purchaser of the breach of the Obligation. The obligations
of Inland Real Estate Acquisitions, Inc. set forth in this SECTION 10.1 shall be
an obligation of Inland Real Estate Acquisitions, Inc., which expressly survive
Closing hereunder.
10.2 PURCHASER'S REMEDIES. If Seller fails to consummate the sale of the
Property pursuant to this Agreement or otherwise defaults on its obligations
hereunder at or prior to Closing for any reason except failure by Purchaser to
perform hereunder, or if prior to Closing any one or more of Seller's
representations or warranties are breached in any material respect, and such
default or breach is not cured by the earlier of the third (3rd) business day
after written notice thereof from Purchaser or the Closing Date (Purchaser
hereby agreeing to give such written notice to Seller within five business days
after Purchaser first learns of any such default or breach by Seller, except no
notice or cure period shall apply if Seller fails to consummate the sale of the
Property hereunder), Purchaser shall elect, as its sole remedy, either to (a)
terminate this Agreement by giving Seller timely written notice of such election
prior to or at Closing and recover the Xxxxxxx Money, (b) enforce specific
performance to consummate the sale of the Property hereunder, or (c) waive said
failure or breach and proceed to Closing without any reduction in the Purchase
Price. Notwithstanding anything herein to the contrary, Purchaser shall be
deemed to have elected to terminate this Agreement if Purchaser fails to deliver
to Seller written notice of its intent to file a claim or assert a cause of
action for specific performance against Seller on or before thirty business days
following the scheduled Closing Date or, having given such notice, fails to
commence an arbitration resolution of the dispute in accordance with the
requirements hereof following the scheduled Closing Date. Purchaser's remedies
shall be limited to those described in this SECTION 10.2 and SECTIONS 10.3 and
10.4 hereof. IN NO EVENT SHALL SELLER'S DIRECT OR INDIRECT PARTNERS,
SHAREHOLDERS, OWNERS OR AFFILIATES, ANY OFFICER, DIRECTOR, EMPLOYEE OR AGENT OF
THE FOREGOING, OR ANY AFFILIATE OR CONTROLLING PERSON THEREOF HAVE ANY LIABILITY
FOR ANY CLAIM, CAUSE OF ACTION OR OTHER LIABILITY ARISING OUT OF OR RELATING TO
THIS AGREEMENT OR THE PROPERTY, WHETHER BASED ON CONTRACT, COMMON LAW, STATUTE,
EQUITY OR OTHERWISE.
10.3 ATTORNEYS' FEES. In the event either party hereto employs an
attorney in connection with claims by one party against the other arising from
the operation of this Agreement, the non-prevailing party shall pay the
prevailing party all reasonable fees and expenses, including attorneys' fees,
incurred in connection with such claims.
10.4 OTHER EXPENSES. If this Agreement is terminated due to the default
of a party, then the defaulting party shall pay any fees or charges due to
Escrow Agent for holding the Xxxxxxx Money as well as any escrow cancellation
fees or charges and any fees or charges due to the Title Company for preparation
and/or cancellation of the Title Commitment.
Page 24
ARTICLE 11
DISCLAIMERS, RELEASE AND INDEMNITY
11.1 DISCLAIMERS BY SELLER. Except as expressly set forth in this
Agreement, it is understood and agreed that Seller and Seller's agents or
employees have not at any time made and are not now making, and they
specifically disclaim, any warranties, representations or guaranties of any kind
or character, express or implied, with respect to the Property, including, but
not limited to, warranties, representations or guaranties as to (a) matters of
title (other than Seller's special warranty of title to be contained in the
Deed), (b) environmental matters relating to the Property or any portion
thereof, including, without limitation, the presence of Hazardous Materials in,
on, under or in the vicinity of the Property, (c) geological conditions,
including, without limitation, subsidence, subsurface conditions, water table,
underground water reservoirs, limitations regarding the withdrawal of water, and
geologic faults and the resulting damage of past and/or future faulting, (d)
whether, and to the extent to which the Property or any portion thereof is
affected by any stream (surface or underground), body of water, wetlands, flood
prone area, flood plain, floodway or special flood hazard, (e) drainage, (f)
soil conditions, including the existence of instability, past soil repairs, soil
additions or conditions of soil fill, or susceptibility to landslides, or the
sufficiency of any undershoring, (g) the presence of endangered species or any
environmentally sensitive or protected areas, (h) zoning or building
entitlements to which the Property or any portion thereof may be subject, (i)
the availability of any utilities to the Property or any portion thereof
including, without limitation, water, sewage, gas and electric, (j) usages of
adjoining property, (k) access to the Property or any portion thereof, (l) the
value, compliance with the plans and specifications, size, location, age, use,
design, quality, description, suitability, structural integrity, operation,
title to, or physical or financial condition of the Property or any portion
thereof, or any income, expenses, charges, liens, encumbrances, rights or claims
on or affecting or pertaining to the Property or any part thereof, (m) the
condition or use of the Property or compliance of the Property with any or all
past, present or future federal, state or local ordinances, rules, regulations
or laws, building, fire or zoning ordinances, codes or other similar laws, (n)
the existence or non-existence of underground storage tanks, surface
impoundments, or landfills, (o) any other matter affecting the stability and
integrity of the Property, (p) the potential for further development of the
Property, (q) the merchantability of the Property or fitness of the Property for
any particular purpose, (r) the truth, accuracy or completeness of the Property
Documents, (s) tax consequences, or (t) any other matter or thing with respect
to the Property.
11.2 SALE "AS IS, WHERE IS". Purchaser acknowledges and agrees that upon
Closing, Seller shall sell and convey to Purchaser and Purchaser shall accept
the Property "AS IS, WHERE IS, WITH ALL FAULTS," except to the extent expressly
provided otherwise in this Agreement and any document executed by Seller and
delivered to Purchaser at Closing. Except as expressly set forth in this
Agreement, Purchaser has not relied and will not rely on, and Seller has not
made and is not liable for or bound by, any express or implied warranties,
guarantees, statements, representations or information pertaining to the
Property or relating thereto (including specifically, without limitation,
Property information packages distributed with respect to the Property) made or
furnished by Seller, or any property manager, real estate broker, agent or third
party representing or purporting to represent Seller, to whomever made or given,
directly or indirectly, orally or in writing. Purchaser represents that it is a
knowledgeable, experienced and sophisticated purchaser of real estate and that,
except as expressly set forth in
Page 25
this Agreement, it is relying solely on its own expertise and that of
Purchaser's consultants in purchasing the Property and shall make an independent
verification of the accuracy of any documents and information provided by
Seller. Purchaser will conduct such inspections and investigations of the
Property as Purchaser deems necessary, including, but not limited to, the
physical and environmental conditions thereof, and shall rely upon same. By
failing to terminate, this Agreement prior to the expiration of the Inspection
Period, Purchaser acknowledges that Seller has afforded Purchaser a full
opportunity to conduct such investigations of the Property as Purchaser deemed
necessary to satisfy itself as to the condition of the Property and the
existence or non-existence or curative action to be taken with respect to any
Hazardous Materials on or discharged from the Property, and will rely solely
upon same and not upon any information provided by or on behalf of Seller or its
agents or employees with respect thereto, other than such representations,
warranties and covenants of Seller as are expressly set forth in this Agreement.
Upon Closing, Purchaser shall assume the risk that adverse matters, including,
but not limited to, adverse physical or construction defects or adverse
environmental, health or safety conditions, may not have been revealed by
Purchaser's inspections and investigations. Purchaser hereby represents and
warrants to Seller that: (a) Purchaser is represented by legal counsel in
connection with the transaction contemplated by this Agreement; and (b)
Purchaser is purchasing the Property for business, commercial, investment or
other similar purpose and not for use as Purchaser's residence. Purchaser waives
any and all rights or remedies it may have or be entitled to, deriving from
disparity in size or from any significant disparate bargaining position in
relation to Seller.
11.3 SELLER RELEASED FROM LIABILITY. Purchaser acknowledges that it will
have the opportunity to inspect the Property during the Inspection Period, and
during such period, observe its physical characteristics and existing conditions
and the opportunity to conduct such investigation and study on and of the
Property and adjacent areas as Purchaser deems necessary, and Purchaser hereby
FOREVER RELEASES AND DISCHARGES Seller from all responsibility and liability,
including without limitation, liabilities under the Comprehensive Environmental
Response, Compensation and Liability Act Of 1980 (42 U.S.C. Sections 9601 et
seq.), as amended ("CERCLA"), regarding the condition, valuation, salability or
utility of the Property, or its suitability for any purpose whatsoever
(including, but not limited to, with respect to the presence in the soil, air,
structures and surface and subsurface waters, of Hazardous Materials or other
materials or substances that have been or may in the future be determined to be
toxic, hazardous, undesirable or subject to regulation and that may need to be
specially treated, handled and/or removed from the Property under current or
future federal, state and local laws, regulations or guidelines, and any
structural and geologic conditions, subsurface soil and water conditions and
solid and hazardous waste and Hazardous Materials on, under, adjacent to or
otherwise affecting the Property). Purchaser further hereby WAIVES (and by
Closing this transaction will be deemed to have WAIVED) any and all objections
and complaints (including, but not limited to, federal, state and local
statutory and common law based actions, and any private right of action under
any federal, state or local laws, regulations or guidelines to which the
Property is or may be subject, including, but not limited to, CERCLA) concerning
the physical characteristics and any existing conditions of the Property.
Purchaser further hereby assumes the risk of changes in applicable laws and
regulations relating to past, present and future environmental conditions on the
Property and the risk that adverse physical characteristics and conditions,
including, without limitation, the presence of Hazardous Materials or other
contaminants, may not have been revealed by its investigation. Notwithstanding
the foregoing,
Page 26
Purchaser is not assuming responsibility for any environmental condition which
occurred during the term of Seller's ownership of which Seller had actual
knowledge and failed to disclose to Purchaser either through the terms and
provisions of this Agreement or through the Environmental Reports which
Purchaser was provided and/or obtained in the course of its due diligence.
11.4 "HAZARDOUS MATERIALS" DEFINED. For purposes hereof, "HAZARDOUS
MATERIALS" means "Hazardous Material," "Hazardous Substance," "Pollutant or
Contaminant," and "Petroleum" and "Natural Gas Liquids," as those terms are
defined or used in Section 101 of CERCLA, and any other substances regulated
because of their effect or potential effect on public health and the
environment, including, without limitation, PCBs, lead paint, asbestos, urea
formaldehyde, radioactive materials, putrescible materials, and infectious
materials.
11.5 INDEMNITY. Purchaser agrees to indemnify, defend and hold Seller
harmless of and from any and all liabilities, claims, demands, and expenses of
any kind or nature which arise or accrue after Closing and which are in any way
related to the ownership, maintenance, or operation of the Property by Purchaser
and its successors and assigns, including, without limitation, in connection
with Hazardous Materials.
11.6 SURVIVAL. The terms and conditions of this ARTICLE 11 shall
expressly survive the Closing, not merge with the provisions of any closing
documents and shall be incorporated into the Deed.
Purchaser acknowledges and agrees that the disclaimers and other agreements
set forth herein are an integral part of this Agreement and that Seller would
not have agreed to sell the Property to Purchaser for the Purchase Price without
the disclaimers and other agreements set forth above.
ARTICLE 12
MISCELLANEOUS
12.1 PARTIES BOUND; ASSIGNMENT. This Agreement, and the terms, covenants,
and conditions herein contained, shall inure to the benefit of and be binding
upon the heirs, personal representatives, successors, and assigns of each of the
parties hereto. Purchaser may assign its rights under this Agreement upon the
following conditions: (a) the assignee of Purchaser must be an entity
controlling, controlled by, or under common control with Purchaser, (b) all of
the Xxxxxxx Money must have been delivered in accordance herewith, (c) the
Inspection Period shall be deemed to have ended, (d) the assignee of Purchaser
shall assume all obligations of Purchaser hereunder, but Purchaser shall remain
primarily liable for the performance of Purchaser's obligations, including,
without limitation, all matters under SECTION 10.1 above, (e) a copy of the
fully executed written assignment and assumption agreement shall be delivered to
Seller at least ten days prior to Closing, and (f) the requirements in SECTION
12.17 are satisfied.
12.2 HEADINGS. The article, section, subsection, paragraph and/or other
headings of this Agreement are for convenience only and in no way limit or
enlarge the scope or meaning of the language hereof.
Page 27
12.3 INVALIDITY AND WAIVER. If any portion of this Agreement is held
invalid or inoperative, then so far as is reasonable and possible the remainder
of this Agreement shall be deemed valid and operative, and, to the greatest
extent legally possible, effect shall be given to the intent manifested by the
portion held invalid or inoperative. The failure by either party to enforce
against the other any term or provision of this Agreement shall not be deemed to
be a waiver of such party's right to enforce against the other party the same or
any other such term or provision in the future.
12.4 GOVERNING LAW. This Agreement shall, in all respects, be governed,
construed, applied, and enforced in accordance with the law of the state in
which the Real Property is located.
12.5 SURVIVAL. The provisions of this Agreement that contemplate
performance after the Closing and the obligations of the parties not fully
performed at the Closing (other than any unfulfilled closing conditions which
have been waived or deemed waived by the other party) shall survive the Closing
and shall not be deemed to be merged into or waived by the instruments of
Closing.
12.6 ENTIRETY AND AMENDMENTS. This Agreement embodies the entire
agreement between the parties and supersedes all prior agreements and
understandings relating to the Property. This Agreement may be amended or
supplemented only by an instrument in writing executed by the party against whom
enforcement is sought. All Exhibits attached hereto are incorporated herein by
this reference for all purposes.
12.7 TIME. Time is of the essence in the performance of this Agreement.
12.8 CONFIDENTIALITY. Purchaser shall make no public announcement or
disclosure of any information related to this Agreement to outside brokers or
third parties, before or after the Closing, without the prior written specific
consent of Seller; provided, however, that Purchaser may, subject to the
provisions of SECTION 4.7. make disclosure of this Agreement to its Permitted
Outside Parties as necessary to perform its obligations hereunder and as may be
required under laws or regulations applicable to Purchaser. Following the
Closing, Purchaser may make a public announcement or disclosure so long as such
public announcement or disclosure to parties other than the Permitted Outside
Parties does not disclose the Purchase Price paid or other financial terms.
12.9 NO ELECTRONIC TRANSACTIONS. The parties hereby acknowledge and agree
this Agreement shall not be executed, entered into, altered, amended or modified
by electronic means. Without limiting the generality of the foregoing, the
parties hereby agree the transactions contemplated by this Agreement shall not
be conducted by electronic means, except as specifically set forth in the
"Notices" section of this Agreement.
12.10 NOTICES. All notices required or permitted hereunder shall be in
writing and shall be served on the parties at the addresses set forth in SECTION
1.3. Any such notices shall, unless otherwise provided herein, be given or
served (a) by depositing the same in the United States mail, postage paid,
certified and addressed to the party to be notified, with return receipt
requested, (b) by overnight delivery using a nationally recognized overnight
courier, (c) by
Page 28
personal delivery, (d) by facsimile transmission during normal business hours
with a confirmation copy delivered by another method permitted under this
SECTION 12.10, or (e) by electronic mail addressed to the electronic mail
address set forth in SECTION 1.3 for the party to be notified with a
confirmation copy delivered by another method permitted under this SECTION
12.10. Notice given in accordance herewith for all permitted forms of notice
other than by electronic mail, shall be effective upon the earlier to occur of
actual delivery to the address of the addressee or refusal of receipt by the
addressee. Notice given by electronic mail in accordance herewith shall be
effective upon the entrance of such electronic mail into the information
processing system designated by the recipient's electronic mail address. Except
for facsimile and electronic mail notices as described above, no notice
hereunder shall be effective if sent or delivered by electronic means. In no
event shall this Agreement be altered, amended or modified by electronic mail or
electronic record. A party's address may be changed by written notice to the
other party; provided, however, that no notice of a change of address shall be
effective until actual receipt of such notice. Copies of notices are for
informational purposes only, and a failure to give or receive copies of any
notice shall not be deemed a failure to give notice. Notices given by counsel to
the Purchaser shall be deemed given by Purchaser and notices given by counsel to
the Seller shall be deemed given by Seller.
12.11 CONSTRUCTION. The parties acknowledge that the parties and their
counsel have reviewed and revised this Agreement and agree that the normal rule
of construction - to the effect that any ambiguities are to be resolved against
the drafting party - shall not be employed in the interpretation of this
Agreement or any exhibits or amendments hereto.
12.12 CALCULATION OF TIME PERIODS. Unless otherwise specified, in
computing any period of time described herein, the day of the act or event after
which the designated period of time begins to run is not to be included and the
last day of the period so computed is to be included, unless such last day is a
Saturday, Sunday or legal holiday for national banks in the location where the
Property is located, in which event the period shall run until the end of the
next day which is neither a Saturday, Sunday, or legal holiday. The last day of
any period of time described herein shall be deemed to end at 5:00 p.m. local
time in the state in which the Real Property is located.
12.13 EXECUTION IN COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original, and all
of such counterparts shall constitute one Agreement. To facilitate execution of
this Agreement, the parties may execute and exchange by telephone facsimile
counterparts of the signature pages, provided that executed originals thereof
are forwarded to the other party on the same day by any of the delivery methods
set forth in SECTION 12.9 other than facsimile.
12.14 NO RECORDATION. Without the prior written consent of Seller, there
shall be no recordation of either this Agreement or any memorandum hereof, or
any affidavit pertaining hereto, and any such recordation of this Agreement or
memorandum or affidavit by Purchaser without the prior written consent of Seller
shall constitute a default hereunder by Purchaser, whereupon Seller shall have
the remedies set forth in SECTION 10.1 hereof. In addition to any such remedies,
Purchaser shall be obligated to execute an instrument in recordable form
releasing this Agreement or memorandum or affidavit, and Purchaser's obligations
pursuant to this SECTION 12.14 shall survive any termination of this Agreement
as a surviving obligation.
Page 29
12.15 FURTHER ASSURANCES. In addition to the acts and deeds recited herein
and contemplated to be performed, executed and/or delivered by either party at
Closing, each party agrees to perform, execute and deliver, but without any
obligation to incur any additional liability or expense, on or after the Closing
any further deliveries and assurances as may be reasonably necessary to
consummate the transactions contemplated hereby or to further perfect the
conveyance, transfer and assignment of the Property to Purchaser.
12.16 DISCHARGE OF OBLIGATIONS. The acceptance of the Deed by Purchaser
shall be deemed to be a full performance and discharge of every representation
and warranty made by Seller herein and every agreement and obligation on the
part of Seller to be performed pursuant to the provisions of this Agreement,
except those which are herein specifically stated to survive Closing.
12.17 ERISA. Under no circumstances shall Purchaser have the right to
assign this Agreement to any person or entity owned or controlled by an employee
benefit plan if Seller's sale of the Property to such person or entity would, in
the reasonable opinion of Seller's ERISA advisors or consultants, create or
otherwise cause a "prohibited transaction" under ERISA. In the event Purchaser
assigns this Agreement or transfers any ownership interest in Purchaser, and
such assignment or transfer would make the consummation of the transaction
hereunder a "prohibited transaction" under ERISA and necessitate the termination
of this Agreement then, notwithstanding any contrary provision which may be
contained herein, Seller shall have the right to terminate this Agreement.
12.18 NO THIRD PARTY BENEFICIARY. The provisions of this Agreement and of
the documents to be executed and delivered at Closing are and will be for the
benefit of Seller and Purchaser only and are not for the benefit of any third
party, and accordingly, no third party shall have the right to enforce the
provisions of this Agreement or of the documents to be executed and delivered at
Closing, except that a tenant of the Property may enforce Purchaser's indemnity
obligation under SECTION 4.10 hereof.
12.19 REPORTING PERSON. Purchaser and Seller hereby designate the Title
Company as the "reporting person" pursuant to the provisions of Section 6045(e)
of the Internal Revenue Code of 1986, as amended.
12.20 MANDATORY ARBITRATION. The parties have agreed to submit disputes to
mandatory arbitration in accordance with the provisions of EXHIBIT I attached
hereto and made a part hereof for all purposes. Each of Seller and Purchaser
waives the right to commence an action in connection with this Agreement in any
court and expressly agrees to be bound by the decision of the arbitrators
determined in EXHIBIT I attached hereto. The waiver of this SECTION 12.20 will
not prevent Seller or Purchaser from commencing an action in any court for the
sole purposes of enforcing the obligation of the other party to submit to
binding arbitration or the enforcement of an award granted by arbitration herein
or as expressly permitted by SECTION 10.1 hereof.
12.21 LIKE-KIND EXCHANGE. Purchaser may consummate the purchase of the
Property as part of a so-called like-kind exchange (the "EXCHANGE") pursuant to
Section 1031 of the Internal Revenue Code of 19S6, as amended, provided that (a)
Purchaser shall notify Seller in writing no
Page 30
later than ten days before Closing that it intends to consummate this
transaction as part of an Exchange, and shall provide with such notice all
material information relating to the parties and properties to the Exchange; (b)
all costs, fees, and expenses attendant to the Exchange shall be the sole
responsibility of Purchaser, and Purchaser shall indemnify and hold harmless
Seller from and against any such costs, fees, and expenses; (c) the Closing
shall not be delayed or affected by reason of the Exchange nor shall the
consummation or accomplishment of the Exchange be a condition precedent or
condition subsequent to Purchaser's obligations and covenants under this
Agreement; and (d) Seller shall not be required to acquire or hold title to any
real property other than the Property for purposes of consummating the Exchange.
Purchaser agrees to defend, indemnify and hold Seller harmless from any
liability, damages, or costs, including (without limitation) reasonable
attorneys' fees, that may result from Seller's acquiescence to the Exchange.
Seller shall not, by this Agreement or acquiescence to the Exchange, (1) have
its rights under this Agreement, including (without limitation) those that
survive Closing, affected or diminished in any manner or (2) be responsible for
compliance with or be deemed to have warranted to Purchaser that the Exchange in
fact complies with Section 1031 of the Internal Revenue Code of 1986, as
amended. The terms of this Section shall survive Closing.
12.22 POST-CLOSING AUDIT. Seller acknowledges that subsequent to Closing,
Purchaser desires to conduct an audit of operating records for the Property for
the calendar year ended December, 2003, that the Seller owned the Property.
Seller agrees to reasonably cooperate with Purchaser, without incurring
additional costs, and make available for review such Property Information not
previously provided to Purchaser that is necessary for such audit, to the extent
such Property Information in the possession of Seller or its property management
company. Prior to Closing, Purchaser shall provide to Seller the list of
information Purchaser will need in order to accomplish such audit. By agreement
of the parties in order to satisfy the requirements of this SECTION 12.22, the
parties have negotiated and agreed that the letter attached hereto as EXHIBIT K
shall be executed and delivered by Seller at the Closing in satisfaction of
Seller's pre-closing obligations under this SECTION 12.22.
[SIGNATURE PAGES AND EXHIBITS TO FOLLOW]
Page 31
SIGNATURE PAGE TO AGREEMENT OF
PURCHASE AND SALE
BY AND BETWEEN
CH REALTY II/BEST, L.P.
AND
INLAND REAL ESTATE ACQUISITIONS, INC.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
day and year written below.
SELLER:
CH REALTY II/BEST, L.P.,
a Delaware limited partnership
By: CH Realty II/Best GP, L.L.C.,
a Delaware limited liability company,
its General Partner
By: Crow Holdings Mangers, L.L.C.,
a Texas limited liability company,
its Manager
Date executed by Seller By: /s/ Xxxxxx X. XxXxxxx
----------------------------------
3/5/04 Name: Xxxxxx X. XxXxxxx
--------------------- --------------------------------
Title: Vice President
-------------------------------
PURCHASER:
INLAND REAL ESTATE ACQUISITIONS, INC.,
an Illinois corporation
Date executed by Purchaser By: /s/ G. Xxxxxx Xxxxxxx
----------------------------------
3/5/04 Name: G. XXXXXX XXXXXXX
--------------------- --------------------------------
Title: CHAIRMAN
-------------------------------
Page 32
LIST OF EXHIBITS
A - Legal Description of Real Property
B - Special Warranty Deed
X-x - Xxxx of Sale, Assignment and Assumption of Contracts
C-2 - Assignment and Assumption of Leases
D - FIRPTA Certificate
E - ERISA Letter
F - Notice to Tenants
G-l - Tenant Estoppel Certificate
G-2 - Declaration Estoppel
H - List of Tenants
I - Mandatory Arbitration
J - Required Endorsements
X-x - Endorsement
K - Audit Letter
Page 33
EXHIBIT A
LEGAL DESCRIPTION
PARCEL ONE (1):
LOT ONE (1) OF MARYLAND PLAZA (A COMMERCIAL SUBDIVISION) AS SHOWN BY MAP THEREOF
ON FILE IN BOOK 68 OF PLATS, PAGE 75, IN THE OFFICE OF THE COUNTY RECORDER OF
XXXXX COUNTY, NEVADA.
PARCEL TWO (2):
THAT PART OF THE SOUTHWEST QUARTER OF SECTION 14, TOWNSHIP 21 SOUTH, RANGE 61
EAST, MT. DIABLO BASE MERIDIAN, XXXXX COUNTY, NEVADA DESCRIBED AS FOLLOWS:
BEGINNING AT THE SOUTHWESTERLY CORNER OF VILLAS DE MISSION CONDOMINIUMS
SUBDIVISION AS SHOWN ON THE MAP RECORDER IN BOOK 26, OF PLATS, PAGE 11, OFFICIAL
RECORDS OF XXXXX COUNTY NEVADA, SAID POINT BEING ON THE NORTHERLY LINE OF THE
FLAMINGO FLOOD CONTROL CHANNEL AND BEING IN A CURVE CONCAVE NORTHERLY, HAVING A
RADIAL BEARING AT THIS POINT OF NORTH 10 DEG.30'34" WEST, THENCE FROM SAID POINT
BEGINNING SOUTHWESTERLY ALONG THE NORTH LINE OF SAID FLOOD CONTROL CHANNEL AS
FOLLOWS:
1. SOUTHWESTERLY ALONG SAID CURVE HAVING A RADIUS OF 1310.00 FEET THROUGH X
XXXXXXX XXXXX XX 00 XXX.0x'00" FOR AN ARC DISTANCE OF 305.56 FEET;
2. TANGENT TO SAID CURVE NORTH 87 DEG.05'43" WEST, 63.63 FEET;
3. SOUTH 02 DEG.51'17" WEST 35.00 FEET; THENCE LEAVING SAID RIGHT XX XXX XXXX,
XXXXX 00 DEG.30'43" EAST, 238.27 FEET; THENCE NORTH 8 DEG.10'45" EAST, 132.85
FEET; THENCE NORTH 02 DEG.51'43" EAST, 15.00 FEET TO THE POINT OF BEGINNING.
Page 1
[THIS FORM WOULD BE TAILORED TO NEVADA BUT IS REPRESENTATIVE OF FORM]
EXHIBIT B
SPECIAL WARRANTY DEED
THE STATE OF____________ )
) KNOW ALL MEN BY THESE PRESENTS:
COUNTY OF_______________ )
_____________________________, a ______________________ ("GRANTOR"), for
and in consideration of the sum of $10.00 and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, has
GRANTED, BARGAINED, SOLD, and CONVEYED and by these presents does GRANT,
BARGAIN, SELL, and CONVEY unto _________________________, a
___________________________________ ("GRANTEE") the tract or parcel of land in
_____ County, ____________, described in EXHIBIT A, together with all rights,
titles, and interests appurtenant thereto including, without limitation,
Grantor's interest, if any, in any and all adjacent streets, alleys, rights of
way and any adjacent strips and gores (such land and interests are hereinafter
collectively referred to as the "PROPERTY").
This Special Warranty Deed and the conveyance hereinabove set forth is
executed by Grantor and accepted by Grantee subject to all easements,
restrictions, reservations and covenants now of record and further subject to
all matters that a current, accurate survey of the Property would show [WILL ADD
SPECIFIC REFERENCE ONCE SURVEY IS IDENTIFIED], together with the matters
described in EXHIBIT B attached hereto and incorporated herein by this
reference, to the extent the same are validly existing and applicable to the
Property (hereinafter referred to collectively as the "PERMITTED EXCEPTIONS").
Grantee acknowledges that Grantee has independently and personally
inspected the Property. The Property is hereby conveyed to and accepted by
Grantee in its present condition, "AS IS, WITH ALL FAULTS, AND WITHOUT ANY
WARRANTY WHATSOEVER, EXPRESS OR IMPLIED." Notwithstanding anything contained
herein to the contrary, it is understood and agreed that Grantor and Grantor's
agents or employees have never made and are not now making, and they
specifically disclaim, any warranties, representations or guaranties of any kind
or character, express or implied, oral or written, with respect to the Property,
including, but not limited to, warranties, representations or guaranties as to
(a) matters of title (other than Grantor's warranty of title set forth herein),
(b) environmental matters relating to the Property or any portion thereof,
including, without limitation, the presence of Hazardous Materials (as defined
in the purchase and sale agreement, the "SALE AGREEMENT" between Grantor and
Grantee) in, on, under or in the vicinity of the Property, (c) geological
conditions, including, without limitation, subsidence, subsurface conditions,
water table, underground water reservoirs, limitations regarding the withdrawal
of water, and geologic faults and the resulting damage of past and/or future
faulting, (d) whether, and to the extent to which the Property or any portion
thereof is affected by any stream (surface or underground), body of water,
wetlands, flood prone area, flood plain, floodway or special flood hazard, (e)
drainage, (f) soil conditions, including the
Page 1
existence of instability, past soil repairs, soil additions or conditions of
soil fill, or susceptibility to landslides, or the sufficiency of any
undershoring, (g) the presence of endangered species or any environmentally
sensitive or protected areas, (h) zoning or building entitlements to which the
Property or any portion thereof may be subject, (i) the availability of any
utilities to the Property or any portion thereof including, without limitation,
water, sewage, gas and electric, (j) usages of adjoining property, (k) access to
the Property or any portion thereof, (1) the value, compliance with the plans
and specifications, size, location, age, use, design, quality, description,
suitability, structural integrity, operation, title to, or physical or financial
condition of the Property or any portion thereof, or any income, expenses,
charges, liens, encumbrances, rights or claims on or affecting or pertaining to
the Property or any part thereof, (m) the condition or use of the Property or
compliance of the Property with any or all Regulation federal, state or local
ordinances, rules, regulations or laws, building, fire or zoning ordinances,
codes or other similar laws, (n) the existence or non-existence of underground
storage tanks, surface impoundments, or landfills, (o) any other matter
affecting the stability and integrity of the Property, (p) the potential for
further development of the Property, (q) the merchantability of the Property or
fitness of the Property for any particular purpose, (r) the truth, accuracy or
completeness of the Property Documents, (s) tax consequences, or (t) any other
matter or thing with respect to the Property other than as set forth in the Sale
Agreement and subject to the limitations set forth therein. EXCEPT AS EXPRESSLY
SET FORTH HEREIN OR IN THE SALE AGREEMENT, GRANTOR MAKES NO REPRESENTATIONS OR
WARRANTIES OF ANY KIND TO GRANTEE, INCLUDING, WITHOUT LIMITATION, THE PHYSICAL
CONDITION OF THE PROPERTY, OR THEIR SUITABILITY FOR ANY PARTICULAR PURPOSE OR OF
MERCHANTABILITY. GRANTEE IS RELYING ON ITS INVESTIGATIONS OF THE PROPERTY IN
DETERMINING WHETHER TO ACQUIRE IT. THE PROVISIONS OF THIS PARAGRAPH ARE A
MATERIAL PART OF THE CONSIDERATION FOR GRANTOR EXECUTING THIS SPECIAL WARRANTY
DEED, AND SHALL SURVIVE CLOSING.
TO HAVE AND TO HOLD the Property, together with all and singular the rights
and appurtenances thereunto in anywise belonging, unto Grantee, its successors
and assigns forever, and Grantor does hereby bind itself, its successors and
assigns, to WARRANT AND FOREVER DEFEND all and singular the title to the
Property unto the said Grantee, its successors and assigns against every person
whomsoever lawfully claiming or to claim the same or any part thereof by,
through, or under Grantor but not otherwise, subject to the Permitted
Exceptions.
Grantee's address is: _____________________.
EXECUTED as of __________________,200__.
By:
----------------------------------------
Name:
--------------------------------------
Title:
-------------------------------------
Page 2
THE STATE OF ______________ )
)
COUNTY OF ____________________ )
This instrument was acknowledged before me on _____________, 200____, by
_____________________, __________________ of __________________________, a
________________, on behalf of said _____________________________.
Notary Public, State of ___________________
Page 3
EXHIBIT A
LEGAL DESCRIPTION
PARCEL ONE (1):
LOT ONE (1) OF MARYLAND PLAZA (A COMMERCIAL SUBDIVISION) AS SHOWN BY MAP THEREOF
ON FILE IN BOOK 68 OF PLATS, PAGE 75, IN THE OFFICE OF THE COUNTY RECORDER OF
XXXXX COUNTY, NEVADA.
PARCEL TWO (2):
THAT PART OF THE SOUTHWEST QUARTER OF SECTION 14, TOWNSHIP 21 SOUTH, RANGE 61
EAST, MT. DIABLO BASE MERIDIAN, XXXXX COUNTY, NEVADA DESCRIBED AS FOLLOWS:
BEGINNING AT THE SOUTHWESTERLY CORNER OF VILLAS DE MISSION CONDOMINIUMS
SUBDIVISION AS SHOWN ON THE MAP RECORDER IN BOOK 26, OF PLATS, PAGE 11, OFFICIAL
RECORDS OF XXXXX COUNTY NEVADA, SAID POINT BEING ON THE NORTHERLY LINE OF THE
FLAMINGO FLOOD CONTROL CHANNEL AND BEING IN A CURVE CONCAVE NORTHERLY, HAVING A
RADIAL BEARING AT THIS POINT OF NORTH 10 DEG.30'34" WEST, THENCE FROM SAID POINT
BEGINNING SOUTHWESTERLY ALONG THE NORTH LINE OF SAID FLOOD CONTROL CHANNEL AS
FOLLOWS:
1. SOUTHWESTERLY ALONG SAID CURVE HAVING A RADIUS OF 1310.00 FEET THROUGH A
CENTRAL ANGLE OF 13 DEG.21'51" FOR AN ARC DISTANCE OF 305.56 FEET;
2. TANGENT TO SAID CURVE NORTH 87 DEG.05'43" WEST, 63.63 FEET;
3. SOUTH 02 DEG.51'17" WEST 35.00 FEET; THENCE LEAVING SAID RIGHT-OF-WAY LINE,
NORTH 86 DEG.30'43" EAST, 238.27 FEET; THENCE NORTH 8 DEG.10'45" EAST, 132.85
FEET; THENCE NORTH 02 DEG.51'43" EAST, 15.00 FEET TO THE POINT OF BEGINNING.
Page 4
EXHIBIT B
[Permitted Exceptions]
Page 5
[THIS FORM WOULD BE TAILORED TO NEVADA BUT IS REPRESENTATIVE OF FORM]
EXHIBIT C-1
XXXX OF SALE, ASSIGNMENT AND ASSUMPTION OF CONTRACTS
Best on the Boulevard, Las Vegas, Nevada
THIS XXXX OF SALE, ASSIGNMENT AND ASSUMPTION OF CONTRACTS is made as of the
___________ day of_______________________________, ________, by and between
____________________, a____________________ ("ASSIGNOR"), and a __________
("ASSIGNEE").
WITNESSETH:
For good and valuable consideration, receipt and sufficiency of which are
hereby acknowledged, Assignor and Assignee hereby agree as follows:
Assignor hereby sells, transfers, assigns and conveys to Assignee the
following:
(a) All right, title and interest of Assignor in and to all
tangible personal property ("PERSONALTY") set forth in the inventory on EXHIBIT
A attached hereto and made a part hereof, and located on, and used in connection
with the management, maintenance or operation of that certain land and
improvements located in the County of____________, State of __________________,
as more particularly described in EXHIBIT B attached hereto and made a part
hereof ("REAL PROPERTY"), but excluding tangible personal property owned or
leased by Assignor's contractors under the Contracts (as defined below).
(b) To the extent assignable, all right, title and interest of
Assignor in and to those certain contracts set forth on EXHIBIT C attached
hereto and made a part hereof, and all warranties, guaranties, indemnities and
claims (including, without limitation, for workmanship, materials and
performance) and which exist or may hereafter exist against any contractor,
subcontractor, manufacturer or supplier or laborer or other services relating
thereto (collectively, the "CONTRACTS").
(c) All right, title and interest of Assignor in and to those
agreements set forth on EXHIBIT D attached hereto and made a part hereof (the
"LICENSE AGREEMENTS").
2. This Xxxx of Sale, Assignment and Assumption of Contracts is given
pursuant to that certain Agreement of Purchase and Sale (as amended, the
"PURCHASE AGREEMENT") dated as of _____________________ between Assignor and
Assignee, providing for, among other things, the conveyance of the Personalty
and the Contracts.
3. As set forth in ARTICLE 11 of the Purchase Agreement, which is
hereby incorporated by reference as if herein set out in full and except as set
forth herein, the property
Page 1
conveyed hereunder is conveyed by Assignor and accepted by Assignee AS IS, WHERE
IS, AND WITHOUT ANY WARRANTIES OF WHATSOEVER NATURE, EXPRESS OR IMPLIED, EXCEPT
AS EXPRESSLY SET FORTH IN THE PURCHASE AGREEMENT, IT BEING THE INTENTION OF
ASSIGNOR AND ASSIGNEE EXPRESSLY TO NEGATE AND EXCLUDE ALL WARRANTIES, INCLUDING,
WITHOUT LIMITATION, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR
ANY PARTICULAR PURPOSE, WARRANTIES CREATED BY ANY AFFIRMATION OF FACT OR PROMISE
OR BY ANY DESCRIPTION OF THE PROPERTY CONVEYED HEREUNDER, OR BY ANY SAMPLE OR
MODEL THEREOF, AND ALL OTHER WARRANTIES WHATSOEVER CONTAINED IN OR CREATED BY
THE_____________UNIFORM COMMERCIAL CODE.
4. Assignee hereby accepts the assignment of the Personalty, the
Contracts and the License Agreements and agrees to assume and discharge, in
accordance with the terms thereof, all of the obligations thereunder from and
after the date hereof. Additionally, but without limiting the generality of the
foregoing, Assignee agrees to assume and discharge all legal fees and other
costs and expenses incurred with respect to Contracts and Contract renewals and
extensions and License Agreements and License Agreement renewals and extensions
executed subsequent to the Effective Date of the Agreement and those set forth
on EXHIBIT E attached hereto.
5. Assignee agrees to indemnify and hold harmless Assignor from any
cost, liability, damage or expense (including attorneys' fees) arising out of or
relating to Assignee's failure to perform any of the foregoing obligations
arising from and accruing on or after the date hereof.
6. Assignor agrees to indemnify and hold harmless Assignee from any
cost, liability, damage or expense (including attorneys' fees) arising out of or
relating to Assignor's failure to perform any of the obligations of Assignor
under the Contracts or License Agreements, to the extent accruing prior to the
date hereof. Assignor shall be responsible for all reconciliations with
contractors prior to______________ [CLOSING].
7. This Xxxx of Sale, Assignment and Assumption of Contracts may be
executed in any number of counterparts, each of which shall be deemed an
original, but all of which shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Xxxx of Sale,
Assignment and Assumption of Contracts as of the date first above written.
ASSIGNOR:
------------------------------------,
a -----------------------------------
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
Page 2
ASSIGNEE:
------------------------------------,
a -----------------------------------
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
[INSERT APPROPRIATE ACKNOWLEDGMENTS FOR THE STATE]
Exhibit A Personalty
Exhibit B Real Property
Exhibit C Contracts
Exhibit D License Agreements
Exhibit E Contract Costs and Expenses
Page 3
[THIS FORM WOULD BE TAILORED TO NEVADA BUT IS REPRESENTATIVE OF FORM]
EXHIBIT C-2
ASSIGNMENT AND ASSUMPTION OF LEASES
Best on the Boulevard, Las Vegas, Nevada
THIS ASSIGNMENT AND ASSUMPTION OF LEASES is made as of the_________ day of
___________________, _________, by and between ____________________________, a
__________ ("ASSIGNOR"), and _____________________, a _____________________
("ASSIGNEE").
WITNESSETH:
For good and valuable consideration, receipt and sufficiency of which are
hereby acknowledged, Assignor and Assignee hereby agree as follows:
1. Assignor hereby sells, transfers, assigns and conveys to Assignee
all right, title and interest of Assignor in and to those certain leases
described on Exhibit C attached hereto and made a part hereof (the "Tenant
Leases"), relating to the leasing of space in the Real Property and all of the
rights, interests, benefits and privileges of the lessor thereunder, and to the
extent Assignee has not received a credit therefor under the Purchase Agreement
(as defined below), all prepaid rents and security and other deposits held by
Assignor under the Tenant Leases and not credited or returned to tenants, but
subject to all terms, conditions, reservations and limitations set forth in the
Tenant Leases.
2. This Assignment and Assumption of Leases is given pursuant to that
certain Agreement of Purchase and Sale (as amended, the "PURCHASE AGREEMENT")
dated as of _____________________, between Assignor and Assignee, providing for,
among other things, the conveyance of the Personalty and the Tenant Leases.
3. As set forth in ARTICLE 11 of the Purchase Agreement, which is
hereby incorporated by reference as if herein set out in full and except as set
forth herein, the property conveyed hereunder is conveyed by Assignor and
accepted by Assignee AS IS, WHERE IS, AND WITHOUT ANY WARRANTIES OF WHATSOEVER
NATURE, EXPRESS OR IMPLIED, EXCEPT AS EXPRESSLY SET FORTH IN THE PURCHASE
AGREEMENT, IT BEING THE INTENTION OF ASSIGNOR AND ASSIGNEE EXPRESSLY TO NEGATE
AND EXCLUDE ALL WARRANTIES, INCLUDING, WITHOUT LIMITATION, THE IMPLIED
WARRANTIES OF MERCHANTABILITY AND FITNESS FOR ANY PARTICULAR PURPOSE, WARRANTIES
CREATED BY ANY AFFIRMATION OF FACT OR PROMISE OR BY ANY DESCRIPTION OF THE
PROPERTY CONVEYED HEREUNDER, OR BY ANY SAMPLE OR MODEL THEREOF, AND ALL OTHER
WARRANTIES WHATSOEVER CONTAINED IN OR CREATED BY THE ________UNIFORM COMMERCIAL
CODE.
Page 1
4. Assignee hereby accepts the assignment of the Personalty and the
Tenant Leases and agrees to assume and discharge, in accordance with the terms
thereof, all of the obligations thereunder from and after the date hereof.
Additionally, but without limiting the generality of the foregoing, Assignee
agrees to assume and discharge all leasing commissions, costs for tenant
improvements, legal fees and other costs and expenses incurred with respect to
Leases and Lease renewals and extensions executed subsequent to the Effective
Date of the Agreement and those set forth on EXHIBIT D attached hereto.
5. Assignee agrees to indemnify and hold harmless Assignor from any
cost, liability, damage or expense (including attorneys' fees) arising out of or
relating to Assignee's failure to perform any of the foregoing obligations
arising from and accruing on or after the date hereof.
6. Assignor agrees to indemnify and hold harmless Assignee from any
cost, liability, damage or expense (including attorneys' fees) arising out of or
relating to Assignor's failure to perform any of the obligations of Assignor
under the Tenant Leases to the extent accruing prior to the date hereof.
Assignor shall be responsible for all reconciliations with Tenants prior to
____________[CLOSING].
7. This Assignment and Assumption of Leases may be executed in any
number of counterparts, each of which shall be deemed an original, but all of
which shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Assignment and
Assumption of Leases as of the date first above written.
ASSIGNOR:
------------------------------------,
a -----------------------------------
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
ASSIGNEE:
------------------------------------,
a -----------------------------------
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
[INSERT APPROPRIATE ACKNOWLEDGMENTS FOR THE STATE]
Page 2
Exhibit A Personalty
Exhibit B Real Property
Exhibit C Tenant Leases
Exhibit D Lease Costs and Expenses
Page 3
[THIS FORM WOULD BE TAILORED TO NEVADA BUT IS REPRESENTATIVE OF FORM]
EXHIBIT D
FIRPTA CERTIFICATE
Section 1445 of the Internal Revenue Code provides that a transferee of a
U.S. real property interest must withhold tax if the transferor is a foreign
person. To inform _______ ("TRANSFEREE") that withholding of tax is not required
upon the disposition of a U.S. real property interest by _____________________
("TRANSFEROR"), the undersigned, in their capacity as_____________
of______________, but not individually, hereby certifies to Transferee the
following on behalf of Transferor:
1. Transferor is not a foreign corporation, foreign partnership,
foreign trust, or foreign estate (as those terms are defined in the Internal
Revenue Code and Income Tax Regulations);
2. Transferor's U.S. employer identification number is________________;
and
3. Transferor's office address is________________.
Transferor understands that this certification may be disclosed to the
Internal Revenue Service by Transferee and that any false statement contained
herein could be punished by fine, imprisonment, or both.
Under penalties of perjury I declare that I have examined this
certification and to the best of my knowledge and belief it is true, correct and
complete, and I further declare that I have authority to sign this document on
behalf of Transferor.
Dated as of_________, 20____.
------------------------------------,
a -----------------------------------
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
Date:
--------------------------------
Page 1
THE STATE OF________________________ )
)
COUNTY OF ___________________________ )
This instrument was acknowledged before me on __________, 200______, by
______________, _________ of ________________, a _____________, on behalf of
said __________________.
Notary Public, State of ______________
SWORN TO AND SUBSCRIBED BEFORE ME by ______________ on _______________,
200______.
----------------------------------------
Notary Public, State of_________________
Page 2
[THIS FORM WOULD BE TAILORED TO NEVADA BUT IS REPRESENTATIVE OF FORM]
EXHIBIT E
ERISA LETTER
______________________, ___________
____________________
____________________
____________________
____________________
Re: Acquisition of Best on the Boulevard, Las Vegas, Nevada
Ladies and Gentlemen:
The undersigned represents to you that [PURCHASER], or any affiliates
thereof, or any firm, person or entity providing financing for the purchase of
the entire interest of _________________________ in the above-described property
(the "PROPERTY") are not using the assets of an employee benefit plan as defined
in Section 3(3) of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA") and covered under Title I, Part 4 of the ERISA or Section 4975
of the Internal Revenue Code of 1986, as amended, in the performance or
discharge of its obligations under that certain Agreement of Purchase and Sale
dated_______________, __________, with respect to the Property by and between
_______________, as Seller, and the undersigned, as Purchaser, including the
acquisition of the Property.
Very truly yours,
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
Solo Page
[THIS FORM WOULD BE TAILORED TO NEVADA BUT IS REPRESENTATIVE OF FORM]
EXHIBIT F
NOTICE TO TENANTS
_______________, _______
____________________
____________________
____________________
____________________
Dear Tenant:
You are hereby notified that_____________________ ("SELLER"), the current
owner of Best on the Boulevard, Las Vegas, Nevada (the "PROPERTY") and the
current owner of the landlord's interest in your lease in the Property, has sold
the Property to [PURCHASER] ("NEW OWNER"), as of the above date. In connection
with such sale, Seller has assigned and transferred its interest in your lease
and your security deposit thereunder in the amount of $_____________ (the
"SECURITY DEPOSIT") to New Owner, and New Owner has assumed and agreed to
perform all of the landlord's obligations under your lease (including any
obligations set forth in your lease or under applicable law to repay or account
for the Security Deposit) from and after such date. New Owner acknowledges that
New Owner has received and is responsible for the Security Deposit.
Accordingly, (a) all your obligations under the lease from and after the
date hereof, including your obligation to pay rent, shall be performable to and
for the benefit of New Owner, its successors and assigns, and (b) all the
obligations of the landlord under the lease, including any obligations
thereunder or under applicable law to repay or account for the Security Deposit,
shall be the binding obligation of New Owner and its successors and assigns.
Unless and until you are otherwise notified in writing by New Owner, the address
of New Owner for all purposes under your lease is:
Page 1
____________________
____________________
____________________
____________________
Very truly yours,
SELLER:
------------------------------------,
a -----------------------------------
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
NEW OWNER:
------------------------------------,
a -----------------------------------
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
Page 2
[THIS FORM WOULD BE TAILORED TO NEVADA BUT IS REPRESENTATIVE OF FORM]
EXHIBIT G-1
TENANT ESTOPPEL CERTIFICATE
To: _______________, its Successors and Assigns ("Purchaser")
0000 Xxxxxxxxxxx Xxxx
Xxx Xxxxx, Xxxxxxxx 00000
___________________________("Lender")
Re: _______________
_______________
_______________ (the "Property")
Gentlemen:
The following statements are made with the knowledge that you, as purchaser
("Purchaser"), are relying on them in connection with your purchase of the
Property and the assignment to you of the lease referred to below in connection
therewith, and you and your successors and assigns and successor owners of the
Property, as well as Lender and any other mortgage lender on the Property and
the current Landlord (as hereafter defined) may rely on them for all purposes.
The undersigned ("Tenant"), being the Tenant under the lease referred to in
Paragraph 1 below and attached hereto as Schedule 1, covering certain premises
("Leased Premises") at the Property, hereby certifies to you that the following
statements are true, correct and complete as of the date hereof:
1. Tenant is the tenant under a lease (the "Lease") currently with
____________________, as landlord ("Landlord"), dated _____________, 20_____,
demising to Tenant approximately ______________ (______________) square feet at
the Property, a true, correct and complete copy of which is attached hereto as
Schedule 1. The term Lease includes all amendments and modifications to the
Lease and other agreements with respect thereto. There have been no amendments,
modifications or other agreements relating to the Lease except as attached
hereto on Schedule 1. Possession of the Leased Premises was delivered to Tenant
on_________,_____, 20_____. The initial term of the Lease commenced on_______,
20_____, and will expire on ________, 20____, exclusive of unexercised renewal
options and extension options contained in the Lease. There have been no
amendments, modifications or revisions to the Lease, and there are no agreements
of any kind between Landlord and Tenant regarding the Leased Premises, except as
provided in
Page 1
the Lease or except as follows: (if none, write "none"):__________________. The
net rentable square footage of the entire shopping center on the Property
is__________ square feet.
2. The Lease has been duly authorized and executed by Tenant and is in
good standing and in full force and effect.
3. Tenant has accepted and is presently occupying the Leased Premises.
Neither the Lease nor any interest in it has been assigned, transferred, or
mortgaged by Tenant, and no sublease, concession agreement or license covering
the Leased Premises, or any portion of the Leased Premises, has been entered
into by Tenant, except as follows: (if none, write "none"): ___________________.
4. Tenant is currently obligated to pay fixed or base rent under the
Lease in the annual amount of ___________________________ Dollars
($_______________), payable in monthly installments
of___________________________ Dollars ($___________). Rent has been paid under
the Lease through _________________________, 20_____ and no sums have been
prepaid to Landlord, either as the last month's rent or otherwise, except as
follows: (if none, write "none"):______________________________. No sums have
been deposited with Landlord other than_____________ Dollars ($_____________)
deposited as security under the Lease. Except as specifically stated in the
Lease, Tenant is entitled to no rent concessions, free rent, allowances or other
similar compensation in connection with renting the Leased Premises. Tenant is
currently paying monthly installments of $_______________as common area
maintenance, tax and other expense pass-through rentals due under the Lease in
addition to the base rent described above.
5. To Tenant's knowledge, neither Landlord nor Tenant is in default
under the Lease beyond any applicable cure period and, to Tenant's knowledge, no
event has occurred which, with the giving of notice or passage of time, or both,
could result in such a default. Tenant has no knowledge of any setoffs, claims
or defenses to enforcement of the Lease in accordance with its terms.
6. Without limiting the generality of the statement made in Paragraph 1
above, except as specifically stated in the Lease, Tenant has not been granted
(a) any option to extend the term of the Lease, (b) any option to expand the
Leased Premises or to lease additional space within the Property, (c) any right
of first refusal on any space at the Property, (d) any option or right of first
refusal to purchase the Leased Premises or the Property or any part thereof, or
(e) any option to terminate the Lease prior to its stated expiration.
7. Neither Tenant nor any guarantor of Tenant is the subject of any
bankruptcy, reorganization, insolvency, readjustment of deft, dissolution or
liquidation proceeding, and to the best knowledge of Tenant no such proceeding
is contemplated or threatened.
Page 2
Executed this_____________day of _______________, 2004.
TENANT
By:
Print Name:
Title:
Page 3
By execution of this Tenant Estoppel Certificate, the undersigned confirms
that it is the guarantor ("Guarantor") of the Lease pursuant to that certain
guaranty ("Guaranty") dated __________, 20____. The Guaranty has not been
amended, modified or released. Neither the Tenant nor the Landlord is in default
of the Lease or the Guaranty, Guarantor, as of the date hereof, has no defenses
to enforcement of the Guaranty and the Guaranty remains in full force and effect
in accordance with its terms.
GUARANTOR:
By:
----------------------------------
Print Name:
--------------------------
Title:
-------------------------------
Date:
--------------------------------
Page 4
Exhibit A to Tenant Estoppel Certificate
[Lease Agreement and Amendments Thereto, If Any]
Page 5
EXHIBIT G-2
DECLARATION ESTOPPEL CERTIFICATE
To: __________________________, its Successors and Assigns ("Purchaser")
0000 Xxxxxxxxxxx Xxxx
Xxx Xxxxx, Xxxxxxxx 00000
______________________________("Lender")
Re:
______________________________
______________________________
______________________________(the "Property")
Gentlemen:
Reference is hereby made to that certain instrument entitled "Best on the
Boulevard Shopping Center Grant of Reciprocal Easements and Declaration of
Restrictions dated November 30, 1994, executed by__________________________
("DEVELOPER"), recorded on December 9, 1994, as Document No. 01660 in Book
941209, Official Records of Xxxxx County, Nevada (the "DECLARATION").
The undersigned does hereby certify that as of the date hereof:
1. The Declaration is in full force and effect and has not been
amended, modified or supplemented.
2. To the best knowledge and belief of the undersigned, there is
neither any default nor any event which, with the passage of time or the giving
of notice, or both, would constitute a default by Developer in the performance
of its obligations under the Declaration, and, as of the date hereof, the
undersigned has no claims or disputes against Developer under the Declaration.
3. To the best knowledge and belief of the undersigned, there are no
current default-related credits, offsets or deductions to which it is entitled
under the Declaration.
Executed this ___________ day of___________________, 2004.
----------------------------------,
a ---------------------------------
By:--------------------------------
Print Name:------------------------
Title:------------------------------
Page 1
EXHIBIT H
LIST OF TENANTS
1. Best Buy
2. Xx-Xxx ETC
3. Xxxxxx & Xxxxx Booksellers
4. Xxxxxxxx'x Sporting Goods
5. Cost Plus World Market
6. Pier I Imports
7. Xxxxxxx Card Shop/Hallmark
8. Rochester Big & Tall
9. Hollywood Video [TO BE EXECUTED PRIOR TO CLOSING]
10. Deli Planet
Solo Page
EXHIBIT I
MANDATORY ARBITRATION
The parties have agreed to submit disputes to mandatory arbitration in
accordance with the following provisions:
1. ARBITRATION.
(a) GENERAL. Any dispute among Seller and Purchaser as to the
interpretation, of any provision of this Agreement or the rights and obligations
of any party hereunder shall be resolved through binding arbitration as
hereinafter provided in Los Angeles.
(b) SELECTION OF ARBITRATOR. Any controversy or claim arising
out of or relating to this Agreement, or the breach thereof, shall be settled by
arbitration administered by the American Arbitration Association in accordance
with its commercial rules and judgment on the award of the arbitration panel may
be entered in any court having jurisdiction thereof.
Within fifteen (15) days after the commencement of arbitration, each
party shall select one party to act as arbitrator and the two selected shall
select a third arbitrator within ten (10) days of their appointment. If the
arbitrators selected by the parties are unable or fail to agree on a third
arbitrator, the third arbitrator shall be selected by the American Arbitration
Association.
(c) RULES OF ARBITRATION. The arbitrators selected pursuant to
SECTION 1(b) above will establish the rules for proceeding with the arbitration
of the dispute, which will be binding upon all parties to the arbitration
proceeding. The arbitrators may use the rules of AAA for commercial arbitration
but is encouraged to adopt the rules the arbitrators deems appropriate to
accomplish the arbitration in the quickest and least expensive manner possible.
Accordingly, the arbitrators may (1) dispense with any formal rules of evidence
and allow hearsay testimony so as to limit the number of witnesses required, (2)
accept evidence of property values without formal appraisals and upon such
information provided by Seller and Purchaser or other persons and otherwise
minimize discovery procedures as the arbitrators deem appropriate, (3) act upon
their understanding or interpretation of the law on any issue without the
obligation to research the issue or accept or act upon briefs of the issue
prepared by any party, (4) limit the time for presentation of any party's case
as well as the amount of information or number of witnesses to be presented in
connection with any hearing, and (5) impose any other rules which the
arbitrators believe appropriate to effect a resolution of the dispute as quickly
and inexpensively as possible. In any event, the arbitrators (A) shall permit
each side no more than two depositions (including any deposition of experts),
which depositions may not exceed four hours each, one set of ten interrogatories
(inclusive of sub-parts) and one set of five document requests (inclusive of
sub- parts), (B) shall not permit any requests for admissions, (C) shall limit
the hearing, if any, to two days, and (D) shall render his or her decision
within 60 days of the filing of the arbitration.
(d) COSTS OF ARBITRATION. The arbitrators will have the
exclusive authority to determine and award costs of arbitration and the costs
incurred by any party for its attorneys, advisors and consultants.
Page 1
(e) AWARD OF ARBITRATOR. Any award made by the arbitrators shall
be binding on Seller, Purchaser and all parties to the arbitration and shall be
enforceable to the fullest extent of the law.
(f) GOVERNING LAW; ACTUAL DAMAGES; ETC. In reaching any
determination or award, the arbitrators will apply the laws of the state in
which the Property is located. Except as permitted under SECTION 1(d) above, the
arbitrators' award will be limited to actual damages and will not include
punitive or exemplary damages. Nothing contained in this Agreement will be
deemed to give the arbitrators any authority, power or right to alter, change,
amend, modify, add to or subtract from any of the provisions of this Agreement.
All privileges under state and federal law, including, without limitation,
attorney-client, work product and party communication privileges, shall be
preserved and protected. All experts engaged by a party must be disclosed to the
other party within 14 days after the date of notice and demand for arbitration
is given.
Page 2
EXHIBIT J
REQUIRED ENDORSEMENTS
1) 3.1 zoning (Long Form) and including parking and loading docks
2) Extended Coverage over all of the general exceptions
3) Comprehensive Endorsement including encroachments, setback line violations
and covenants and restrictions
4) Subdivision Endorsement
5) Survey Endorsement (insured property is same as surveyed property)
6) Access Endorsement to publicly dedicated roads
7) Utility Facility Endorsement
8) P.I.N-Single Tax Lot Endorsement
9) Contiguity Endorsement
10) Removal of Creditors Rights Exception Endorsement
11) Removal of Arbitration Clause Endorsement
12) Environmental Lien Endorsement
13) Encroachment Endorsement for any encroachments identified on the survey (in
the manner attached hereto as Exhibit X-x).
Solo Page
EXHIBIT J-1
ENDORSEMENT
Attached to Policy No. ________________
Issued By
ARTICLE 13 CHICAGO TITLE INSURANCE COMPANY
The Company insures the insured against loss, if any, sustained by the
insured under the terms of this Policy by reason of a final, non-appealable
judgment of a court of competent jurisdiction that orders the removal of this
improvement because it encroaches over or into easement in favor of Nevada Power
Company and Central Telephone Company dated October 7, 1976, recorded October
21, 1976, in Book 671 as Document No. 630459, Official Records. Company agrees
to provide defense to the insured in accordance with the terms of this Policy if
suit is brought against the insured to require the removal of this improvement
because it encroaches as herein stated.
This endorsement is made a part of the policy and is subject to all of the
terms and provisions thereof and of any prior endorsements thereto. Except to
the extent expressly stated, it neither modifies any of the terms and provisions
of the policy and any prior endorsements, nor does it extend the effective date
of the policy and any prior endorsements, nor does it increase the face amount
thereof.
Dated: ___________________________
Chicago Title Insurance Company
By:------------------------------
SOLO PAGE
EXHIBIT K
AUDIT LETTER
________________________, 2004
KPMG LLP
KPMG Plaza
000 Xxxx Xxxxxx Xxxxx
Xxxxxxx, XX 00000
Ladies and Gentlemen
We, as the owner and Seller (herein so called) of Best on the Boulevard (the
"Property") are confirming our understanding that your audit of the Historical
Summary of Gross Income and Direct Operating Expenses ("Historical Summary") of
Best on the Boulevard for the calendar year ended December, 2003, during our
period of ownership will be made for the purpose of expressing an opinion to
your client, _____________________________________, as to whether the Historical
Summary presents fairly, in all material respects, the gross income and direct
operating expenses in conformity with the CASH OR ACCRUAL basis of accounting.
In connection with your audit, we confirm, to our actual knowledge without
additional investigation or inquiry, the following representations are made as
to the audit:
1. We will make available to you:
a) All financial records and related data for the Property reasonably
requested by you in our possession.
2. There have been no:
a) Instances of fraud involving any member of management or
employees who have significant roles in internal control, nor are we
aware of instances of fraud by others.
b) Communications from regulatory agencies concerning non-compliance
with, or deficiencies in, financial reporting practices received by
the undersigned that could reasonably be expected to have a material
effect on the Historical Summary.
c) Violations or possible violations of laws or regulations for
which we have received actual notices, the effects of which should be
considered for disclosure in the Historical Summary or as a basis for
recording the loss contingency, nor are we aware of any violations of
laws or regulations that to our actual knowledge would have an adverse
impact upon the materials delivered to you.
Page 1
d) Nor are we aware of any entries in the minutes of any applicable
board or summary of recent meetings for which minutes have not yet
been prepared which conflict with the financial records provided or
the statements made herein.
3. There are no:
a) Material transactions that have not been properly recorded in the
accounting records underlying the Historical Summary.
b) Events that have occurred subsequent to the balance sheet date and
through the date of this latter that would require adjustment to or
disclosure in the Historical Summary.
c) Uninsured claims, asserted claims, material liabilities or loss
contingencies that we believe should have been recorded in the
financial statements that have not been recorded.
4. We have received no notices indicating that the Property has failed to
comply with all aspects of the contractual agreements that would have a
material effect on the Historical Summary in the event of noncompliance.
5. All income from operating leases is included as gross income in the
Historical Summary. No other forms of revenue are included in the
Historical Summary.
6. Terms such as "to our knowledge," "to the best of our knowledge", "to our
actual knowledge" or like phrases mean the actual present and conscious
awareness or knowledge of Xxx Xxxxxxx ("Seller's Representative"), without
any duty of inquiry or investigation; provided that so qualifying Seller's
knowledge shall in no event give rise to any personal liability on the part
of Seller's Representative, or any of them, or any other officer or
employee of Seller, on account of any breach of any representation or
warranty made by Seller herein. Said terms do not include constructive
knowledge, imputed knowledge, or knowledge Seller or such persons do not
have but could have obtained through further investigation or inquiry.
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Further, we confirm that to our knowledge the financial records do not fail to
disclose any material factors for the Historical Summary.
Very Truly Yours,
CH REALTY II/BEST, L.P.,
a Delaware limited partnership
By: CH Realty II/Best GP, L.L.C.,
a Delaware limited liability company,
its General Partner
By: Crow Holdings Managers, L.L.C.,
a Texas limited liability company,
its Manager
By:
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Name:
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Title:
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