EXECUTION COPY
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PURCHASE AND SALE AGREEMENT
BY AND AMONG
ECHELON INTERNATIONAL CORPORATION
AND
CERTAIN OF ITS SUBSIDIARIES,
COLLECTIVELY, AS SELLER,
AND
ECHELON RESIDENTIAL LLC,
AS BUYER
JANUARY 21, 2000
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TABLE OF CONTENTS
Page
Section 1. Definitions and References.........................................1
Section 2. Purchase and Sale.................................................10
2.1 Purchase Price..................................................10
2.2 Terms of Payment................................................10
2.3 Assumption of Liabilities.......................................11
Section 3. Sellers Representations and Warranties............................11
3.1 Due Organization and Good Standing of Seller....................12
3.2 Authorization and Validity of Agreement.........................12
3.3 Consents and Approvals; No Violations...........................13
3.4 Title to Assets; Encumbrances...................................13
3.5 Ownership of Joint Venture Interests............................14
3.6 Ownership of Employee Loans.....................................14
3.7 Environmental Laws and Regulations..............................14
3.8 Leases..........................................................15
3.9 Litigation......................................................15
3.10 Land Use........................................................15
3.11 Contracts.......................................................16
3.12 Existing Debt...................................................16
3.13 Employee Benefit Plans; Labor Matters...........................16
3.14 Intellectual Property...........................................17
3.15 Insurance.......................................................18
3.16 Assets..........................................................18
3.17 Reports and Financial Statements................................18
3.18 Absence of Certain Changes......................................19
3.19 Liabilities.....................................................19
3.20 Compliance with Laws............................................19
3.21 Year 2000.......................................................20
3.22 No Other Representations or Warranties..........................20
Section 4. Buyers Representations and Warranties.............................20
4.1 Due Organization and Good Standing of Buyer.....................20
4.2 Authorization and Validity of Agreement.........................20
4.3 Consents and Approvals; No Violations...........................20
4.4 Condition of the Assets.........................................21
4.5 Liens...........................................................22
4.6 Purchase for Investment.........................................22
4.7 Sufficient Funds................................................22
4.8 Title and Survey................................................22
4.9 Inspection......................................................22
4.10 No Other Representations or Warranties..........................22
Section 5. Covenants.........................................................23
5.1 Compliance......................................................23
5.2 Notices of Violations...........................................23
5.3 Ownership of Assets; Proceeds of Asset Sales....................23
5.4 Operation of Assets Subsequent to the Agreement Date............23
5.5 Status of Agreements............................................25
5.6 Further Assurances..............................................26
5.7 Consents........................................................27
5.8 Use of Business Names by Buyer..................................27
5.9 Bringdown of Sellers Representations............................27
5.10 Cooperation Regarding Taxes.....................................28
5.11 Insurance.......................................................28
5.12 Reasonable Best Efforts.........................................29
5.13 Access to Information Concerning Assets.........................29
5.14 Notification of Certain Matters.................................30
5.15 HSR Act.........................................................30
5.16 Access to Information Pursuant to Distribution Agreement........30
5.17 Witness Services Under Distribution Agreement...................30
5.18 Retention of Records............................................30
Section 6. Conditions Precedent to Closing....................................31
6.1 Buyer Conditions................................................31
6.2 Seller Conditions...............................................32
Section 7. Closing...........................................................33
7.1 Time and Place..................................................33
7.2 Closing Expenses................................................33
7.3 Notification of Escrow Closing Date.............................33
7.4 Documents and/or Deliveries.....................................34
7.5 Buyer Documents and/or Deliveries...............................36
7.6 Execution and Delivery of Closing Statements....................37
7.7 Joint Instructions to Escrow Agent..............................37
7.8 Further Deliveries..............................................37
Section 8. Brokers...........................................................38
Section 9. Termination and Abandonment.......................................38
9.1 Termination.....................................................38
9.2 Effect of Termination...........................................39
Section 10. Risk of Loss; Indemnity..........................................41
10.1 Casualty.......................................................41
10.2 Condemnation...................................................41
10.3 Indemnity......................................................41
Section 11. Employees and Employee Benefits Matters..........................43
11.1 Transfer of Employees..........................................43
11.2 Assumption of Liabilities......................................43
11.3 Participation and Crediting of Service Under Employee Plans and
Practices....................................................45
Section 12. Miscellaneous.....................................................45
12.1 Litigation.....................................................45
12.2 Escrow Obligations of Escrow Agent.............................45
12.3 Notices........................................................47
12.4 Entire Agreement...............................................48
12.5 Successors and Assigns.........................................48
12.6 Headings.......................................................49
12.7 Applicable Law.................................................49
12.8 Severability...................................................49
12.9 Counterparts...................................................49
12.10 No Waiver of Default...........................................49
12.11 Confidentiality................................................50
12.12 Recourse Limited...............................................50
12.13 Business Day...................................................50
12.14 Recordation....................................................51
12.15 Jury Waiver....................................................51
12.16 Public Announcements...........................................51
12.17 Radon Gas......................................................51
12.18 Bulk Sales Law Waiver..........................................52
12.19 Knowledge......................................................52
12.20 Amendments, Modifications and Supplements......................52
12.21 Representations and Warranties.................................52
12.22 Performance and Discharge......................................52
SCHEDULES
Schedule I - List of Assets and Owners
Schedule II - List of Existing Debt
Schedule III - Leases
Schedule IV - Purchase Price Allocation
Schedule V - Consents
Schedule VI - Liens on Real Estate Assets
Schedule VII - Liens on Joint Venture Interests
Schedule VIII - Required Consents
Schedule IX - Hazardous Materials
Schedule X - Permits
Schedule XI - Real Estate Contracts
Schedule XII - Employee Benefit Plans
Schedule XIII - Employees Subject to Existing
Employment Agreements
Schedule XIV - Intellectual Property
Schedule XV - Pending Transactions
Schedule XVI - Land Use
Schedule XVII - Litigation
Schedule XVIII - List of Subsidiary Non-Qualification
Information
Schedule XIX - Changes in Operations
Schedule XX - Violations
Schedule XXI - Trial Balance & Consolidated Financial
Statements
Schedule XXII - Insurance
Schedule XXIII - Real Estate Related Accounts
Schedule XXIV - Title Insurance Commitments or
Other Reports
Schedule XXV - Surveys
EXHIBITS
Exhibit A - Form of Special Warranty Deed
Exhibit B - Form of Xxxx of Sale
Exhibit C - Form of Assignment and Assumption of
Permits, Contracts and Leases
Exhibit D - Form of Tenant Estoppel Statement
Exhibit E - Form of Assignment and Assumption
Agreement of Mortgage Loans
Exhibit F - Form of Assignment of Trademarks
Exhibit G - Severance Benefits Plan
Exhibit H - Intentionally Omitted
Exhibit I - Form of Title Affidavit
Exhibit J - Form of Gap Indemnity
Exhibit K - Form of FIRPTA Affidavit
Exhibit L - Joint Direction Letter
Exhibit M - Joint Instruction Letter
PURCHASE AND SALE AGREEMENT
THIS PURCHASE AND SALE AGREEMENT (this "Agreement") is made as of the
21st day of January, 2000, by and among ECHELON INTERNATIONAL CORPORATION, a
Florida corporation ("Echelon"), and various of its subsidiaries signatory
hereto (each, a "Subsidiary", and collectively, the "Subsidiaries") (Echelon and
the Subsidiaries are collectively referred to herein as "Seller"), and ECHELON
RESIDENTIAL LLC, a Delaware limited liability company ("Buyer"). All capitalized
terms used herein shall have the meanings set forth in Section 1 hereof.
WHEREAS, Echelon, either itself or through a Subsidiary, is the owner
of the real estate and other interests and assets more specifically described in
Schedule I (other than Part V thereof) annexed hereto and made a part hereof
(collectively, the "Assets"); and
WHEREAS, Seller desires to sell, and Buyer desires to purchase, all of
Seller's right, title and interest in and to the Assets pursuant to and in
accordance with the terms and provisions of this Agreement;
NOW, THEREFORE, for and in consideration of the mutual covenants and
agreements herein set forth and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Seller agrees to sell,
assign and transfer to Buyer, and Buyer agrees to purchase and assume from
Seller, for the price and on the terms and subject to the conditions herein set
forth, all of Seller's right, title and interest in and to the Assets and the
Assumed Liabilities.
Section 1. Definitions and References.
The following terms, as used in this Agreement, have the following
meanings unless the context is inconsistent therewith:
"Agreement" has the meaning set forth in the introductory paragraph
hereof.
"Agreement Date" means the date upon which this Agreement has been
executed and delivered by Seller, Buyer and Escrow Agent.
"Asset Sales Proceeds" has the meaning set forth in Section 5.3
hereof.
"Assets" has the meaning set forth in the first recital hereof, as
more particularly described on Schedule I (other than Part V thereof), and
includes, without limitation, any Asset Sales Proceeds; it being understood and
agreed, for avoidance of doubt, that none of the following shall constitute a
portion of the Assets: (i) the Excepted Leases, (ii) the Tax Credit LP
Interests, (iii) the Other Assets, (iv) any and all cash on hand (including,
without limitation, (A) cash with respect to the Excepted Leases and (B) cash
with respect to the Tax Credit LP Interests, but, in any event, excluding the
restricted cash (and cash equivalents) described in item 17 under Part VII of
Schedule I) and (v) any and all refunds or any reduction of, or credit against,
Seller's Tax liabilities (other than with respect to Real Estate Taxes) in or
with respect to any taxable year (including all periods prior to the Closing
Date).
"Assumed Liabilities" has the meaning set forth in Section 2.3 hereof.
"Bringdown Certificate" has the meaning set forth in Section 5.9
hereof.
"Broker" has the meaning set forth in Section 8 hereof.
"Business Day" means any day, other than a Saturday, Sunday or a day
on which banks located in the State of New York shall be authorized or required
by law to close.
"Buyer" has the meaning set forth in the introductory paragraph
hereof.
"Claim" has the meaning set forth in Section 10.3 hereof.
"Claim Notice" has the meaning set forth in Section 10.3 hereof.
"Closing" means the consummation of the transfer, assignment and sale
and conveyance of the Assets by or on behalf of Seller to Buyer and payment of
the Purchase Price and assumption of the Assumed Liabilities by Buyer to Seller,
pursuant to Section 7 hereof.
"Closing Date" has the meaning specified in Section 7.1 hereof.
"COBRA" has the meaning set forth in Section 11.2(a)(1) hereof.
"Code" has the meaning set forth in Section 3.13 hereof.
"Combining Trial Balance" means the trial balance set forth in Part I
of Schedule XXI annexed hereto and made a part hereof.
"Commercial Property" means the real property, including the
improvements thereon, described in Part I of Schedule I; provided, that in no
event shall "Commercial Property" include any or all of the Other Assets.
"Commercial Property Security Deposit Amount" means the aggregate
amount (as in effect on the Escrow Closing Date) of cash (and cash equivalents)
associated with the customer deposits (but only to the extent same relates to
the Leases) included in general ledger balance sheet account number 25020-000
set forth on the Combining Trial Balance.
"Commission" has the meaning set forth in Section 3.17(a) hereof.
"Commission Filings" has the meaning set forth in Section 3.17(a)
hereof.
"Contracts" means, collectively, (i) the contracts, agreements and
commitments described on Schedule XI annexed hereto and made a part hereof, (ii)
any contract, agreement or commitment by which Seller is bound primarily
affecting or relating to any of the Total Assets (excluding Leases and leases
relating to the Residential Properties, Encumbrances on title and any documents
and instruments related to the Existing Debt) which involves base payments or
the performance of services by Seller of an amount or value (as measured by the
revenue derived therefrom during fiscal year 1998-1999) not in excess of $12,000
annually or is terminable by Seller on not more than 90 days notice without
penalty and (iii) any and all contracts, agreements and commitments by which
Seller is bound primarily affecting or relating to any of the Total Assets
(excluding Leases and leases relating to the Residential Properties,
Encumbrances on title and any documents and instruments related to the Existing
Debt) and which are entered into after the Agreement Date in compliance with the
provisions of this Agreement; provided, that in no event shall "Contracts"
include any or all of the Other Contracts.
"County" means a political subdivision of the State within which a
Real Estate Asset is situated.
"Deposit" has the meaning set forth in Section 2.2(a) hereof.
"Distribution Agreement" means the Distribution Agreement, dated as of
December 16, 1996, by and between Florida Progress and Echelon.
"Echelon" has the meaning set forth in the introductory paragraph
hereof.
"Employee Benefit Plans" has the meaning set forth in Section 3.13
hereof.
"Employee Loans" means the loans described in Part IX of Schedule I.
"Encumbrance" has the meaning set forth in Section 3.3 hereof.
"Environmental Claims" means administrative, regulatory or judicial
actions, suits, demands, demand letters, claims, liens, notices of
non-compliance or violation, investigations or proceedings relating in any way
to any Environmental Law or any permit issued under any such Environmental Law,
including (a) Environmental Claims by governmental or regulatory authorities for
enforcement, cleanup, removal, response, remedial or other actions or damages
pursuant to any applicable Environmental Law and (b) Environmental Claims by any
third party seeking damages, contribution, indemnification, cost recovery,
compensation or injunctive relief resulting from Hazardous Materials or arising
from alleged injury or threat of injury to health, safety or the environment.
"Environmental Law" means any federal, state or local statute, law,
rule, regulation, ordinance, code, policy or rule of common law in effect and in
each case as amended as of the Closing Date, and any judicial or administrative
interpretation thereof as of the Closing Date, including any judicial or
administrative order, consent decree or judgment, relating to the environment,
health, safety or Hazardous Materials, including the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, as amended, 42 U.S.C. ss.
9601 et seq.; the Resource Conservation and Recovery Act, as amended, 42 U.S.C.
ss. 6901 et seq.; the Federal Water Pollution Control Act, as amended, 33 U.S.C.
ss. 1251 et seq.; the Toxic Substances Control Act, 15 U.S.C. ss. 2601 et seq.;
the Clean Air Act, 42 U.S.C. ss. 7401 et seq.; the Safe Drinking Water Act, 42
U.S.C. ss. 300f et seq.; the Oil Pollution Act of 1990, 33 U.S.C. ss. 2701 et
seq.; and their state and local counterparts and equivalents.
"ERISA" has the meaning set forth in Section 3.13 hereof.
"Escrow Agent" means LandAmerica Financial Group, a Virginia
corporation.
"Escrow Closing" means the delivery on the Escrow Closing Date to
Escrow Agent by each of Buyer and Seller of the agreements, documents and
instruments specified in Sections 7.4 and 7.5 hereof, respectively.
"Escrow Closing Date" means the date specified as such in the initial
Escrow Date Notification Certificate delivered by Seller to Buyer; provided,
that if Seller shall deliver one or more subsequent Escrow Date Notification
Certificates in accordance with Section 7.3 hereof, the Escrow Closing Date
shall mean the date specified as such in the last Escrow Date Notification
Certificate theretofore delivered by Seller to Buyer.
"Escrow Date Notification Certificate" has the meaning set forth in
Section 7.3 hereof.
"Escrowed Items" has the meaning set forth in Section 7.7 hereof.
"Excepted Leases" has the meaning provided in Schedule I.
"Excess Cash Amount" means the aggregate amount of cash and cash
equivalents, if any, which is expected (in the sole determination of the Chief
Financial Officer of Echelon made on the Escrow Closing Date) to remain in
Echelon or its subsidiaries after consummation of all transactions contemplated
by this Agreement, the Merger Agreement and the Subscription Agreement;
provided, that in no event shall the Excess Cash Amount include an amount equal
to $7,000,000 plus the aggregate amount of rent payments, whether in arrears or
in advance, actually received by Seller with respect to the Leveraged Lease
Portfolio (as defined in the Merger Agreement) during the period from February
1, 2000 through the Effective Date (as defined in the Merger Agreement); and
provided, further, in no event shall the Excess Cash Amount be less than $0.
"Excluded Liabilities" means any liabilities or obligations of Seller
or its affiliates or predecessors other than the Assumed Liabilities, and in any
event "Excluded Liabilities" shall be inclusive of all liabilities or
obligations for which Seller (or its affiliates or predecessors) is responsible
pursuant to Section 11 hereof and those arising out of or relating to (i) the
Excepted Leases (including those liabilities and obligations (as of the Closing
Date) referred to in the Combining Trial Balance under the column heading
"Aircraft Assets & Liabilities"), (ii) the Tax Credit LP Interests, (iii) Taxes
(other than Real Estate Taxes), (iv) the Other Assumed Liabilities, (v) this
Agreement or the Merger Agreement (including with respect to any shareholder
litigation relating hereto or thereto), (vi) except to the extent Buyer is
responsible therefor pursuant to Section 11 hereof, all obligations (including
payments due as a result of a change of control of Echelon or otherwise) under
any employment agreement entered into by Echelon or any of its Subsidiaries
(including the employment agreements described on Schedule XIII annexed hereto
and made a part hereof) and (vii) assets or businesses previously owned by
Seller (or its affiliates or predecessors) which were divested or otherwise
disposed of prior to the Agreement Date (including, without limitation, any
liabilities or obligations of Seller (or its affiliates or predecessors) arising
out of or related to (A) the spin-off of Echelon and the other transactions
contemplated by the Distribution Agreement and (B) the first mortgage bonds
secured by certain life care communities previously owned directly or indirectly
by Seller).
"Executive Loans Repayment Amount" means (as of the Escrow Closing
Date) the aggregate outstanding principal amount, together with any accrued
interest, charges, fees or other amounts related thereto, of any loans extended
by Seller to W. Xxxxxxx Xxxxxxx, Xxxxx X. Xxxxxxx, Xxxxx X. Xxxxxxx and Xxxxx X.
Xxxxx.
"Existing Debt" means the indebtedness described in Schedule II
annexed hereto and made a part hereof; provided, that, in no event shall
"Existing Debt" include any or all of the Other Existing Debt.
"Financial Statements" has the meaning set forth in Section 3.17(a)
hereof.
"Florida Progress" means Florida Progress Corporation, a Florida
corporation.
"GAAP" has the meaning set forth in Section 3.17(a) hereof.
"Hazardous Materials" means (a) any petroleum or petroleum products,
radioactive materials, asbestos in any form that is friable, urea formaldehyde
foam insulation and polychlorinated biphenyls; (b) any chemicals, materials or
substances defined as or included in the definition of "hazardous substances",
"hazardous wastes", "hazardous materials", "extremely hazardous substances",
"restricted hazardous wastes", "toxic substances", "toxic pollutants", or words
of similar import, under any applicable Environmental Law; and (c) any other
substance (other than Radon) prohibited or regulated pursuant to the provisions
of any Environmental Law.
"Xxxxxx Lease" means the Lease Agreement, dated as of January 21,
2000, between Xxxxxx Affordable Housing of Florida, Inc., a Florida corporation,
and Echelon Commercial LLC, a Delaware limited liability company (in the form
executed on the Agreement Date and thereafter, as amended, modified or
supplemented from time to time with the prior written consent of Echelon).
"herein" or "hereof" means this entire Agreement rather than just the
sentence, paragraph or section in which used.
"HSR Act" has the meaning set forth in Section 3.3 hereof.
"Improvements" means all buildings, structures and other improvements
existing upon the Land.
"including", "include" or "includes" mean including as an example,
without limiting the generality of the description.
"Indemnitee" has the meaning set forth in Section 10.3 hereof.
"Indemnitor" has the meaning set forth in Section 10.3 hereof.
"Intangible Personal Property" means the Intellectual Property and
other intangible personal property used primarily in connection with the Total
Assets, and includes, without limitation, (i) the intangible personal property
described on Part VII of Schedule I and (ii) all interest of Echelon and its
subsidiaries in all assignable credit records, security codes, assignable
telephone numbers, warranties and guarantees; provided, that in no event shall
"Intangible Personal Property" include any or all of the Other Intangible
Personal Property.
"Intellectual Property" means all trademarks, trade names, service
marks, copyrights and any applications therefor, inventions, discoveries,
technology, trade secrets, know-how, data, computer software programs or
applications, (including all source and object codes thereto) and all
proprietary information or material that in any material respect is used by
Echelon and/or its subsidiaries in connection with the Total Assets, as more
particularly described in Schedule XIV annexed hereto and made a part hereof;
provided, that in no event shall "Intellectual Property" include any or all of
the Other Intellectual Property.
"Joint Venture Interests" means Seller's equity interests in the joint
ventures described in Part VI of Schedule I.
"Land" means, singularly or collectively, the various real properties
underlying the Real Estate Assets, together with all tenements, hereditaments,
easements, privileges, reversions, remainders and other rights and appurtenances
belonging or in any manner appertaining thereto, including all reversionary
interests in and to any adjoining or abutting rights-of-way and all riparian,
littoral and other water rights.
"Leases" means the leases relating to the use or occupancy of portions
of the Commercial Property which are more particularly described on Schedule III
annexed hereto and made a part hereof; provided, that in no event shall "Leases"
include any or all of the Other Leases.
"Litigation" has the meaning set forth in Section 3.9 hereof.
"Losses" has the meaning set forth in Section 10.3 hereof.
"Material Adverse Effect" means a material adverse effect on the
business, results of operations or financial condition of the Total Assets taken
as a whole.
"Merger" means the merger of EIN Acquisition Corp., a Florida
corporation, with and into Echelon, with Echelon being the surviving
corporation, on the terms and subject to the conditions set forth in the Merger
Agreement.
"Merger Agreement" means the Agreement and Plan of Merger, dated as of
January 21, 2000, by and among ETA Holding LLC, a Delaware limited liability
company, EIN Acquisition Corp., a Florida corporation and a direct wholly-owned
subsidiary of ETA Holding LLC, and Echelon (as same is in effect on the
Agreement Date and thereafter, as amended, modified or supplemented from time to
time in accordance with the terms thereof and consistent with the terms of
Section 5.5(b) hereof).
"Minimum Cash Amount" means $21,275,000.
"NationsBank Tower" means the 26-story Class A office tower located at
Xxx Xxxxxxxx Xxxxx, Xx. Xxxxxxxxxx, Xxxxxxx.
"Net Sale Proceeds" means, for any Pending Transaction, the gross cash
proceeds received from such Pending Transaction, net of (i) reasonable and
customary transaction costs (including, without limitation, any underwriting,
brokerage or other customary selling commissions payable to employees or third
parties and all legal, advisory and other fees and expenses, including title,
survey, transfer taxes, property taxes and recording expenses associated
therewith), (ii) the amount of such gross cash proceeds required to be used to
repay any Existing Debt which is secured by or directly related to the
respective assets which were sold, transferred or otherwise disposed of
concurrently with the consummation of such Pending Transaction and (iii) any
pre-closing or post-closing adjustments to the purchase price for the Asset that
is the subject of such Pending Transaction in accordance with the terms and
conditions of the documentation relating to such Pending Transaction.
"Offer" has the meaning specified in the Merger Agreement.
"Other Assets" means the "Assets" as defined in the Subscription
Agreement.
"Other Assumed Liabilities" means the "Assumed Liabilities" as defined
in the Subscription Agreement.
"Other Buyer" means "Company" as defined in the Subscription
Agreement.
"Other Contracts" means the "Contracts" as defined in the Subscription
Agreement.
"Other Existing Debt" means the "Assumed Debt" as defined in the
Subscription Agreement.
"Other Intangible Personal Property" means the "Intangible Personal
Property" as defined in the Subscription Agreement.
"Other Intellectual Property" means the "Intellectual Property" as
defined in the Subscription Agreement.
"Other Leases" means the "Leases" as defined in the Subscription
Agreement.
"Other Permits" means the "Permits" as defined in the Subscription
Agreement.
"Other Personalty" means the "Personalty" as defined in the
Subscription Agreement.
"Other Real Estate Assets" means the "Real Estate Assets" as defined
in the Subscription Agreement.
"Other Tangible Personal Property" means the "Tangible Personal
Property" as defined in the Subscription Agreement.
"Pending Transactions" has the meaning set forth in Section 5.3
hereof.
"Permits" means the licenses or permits required to be maintained by
Seller for the development, use or occupancy of any portion of any of the Real
Estate Assets, including those certificates of occupancy and other material
licenses and permits described in Schedule X annexed hereto and made a part
hereof; provided, that in no event shall "Permits" include any or all of the
Other Permits.
"Person" means and includes an individual, a partnership, a joint
venture, a corporation, a trust, a limited liability company, an unincorporated
organization, a group and a government or other department or agency thereof.
"Personalty" means the Tangible Personal Property and Intangible
Personal Property; provided, that in no event shall "Personalty" include any or
all of the Other Personalty.
"Pre-Approved Expenditures" means the aggregate amount of (i) all
expenditures of Seller described in Part III of Schedule XV annexed hereto and
made a part hereof but only to the extent actually paid by Seller in respect of
the respective Assets or Other Assets indicated on such Part III of Schedule XV
at any time after November 30, 1999 and on or prior to the Escrow Closing Date
and (ii) any and all other expenditures incurred by Seller from time to time but
in each case only to the extent approved by Buyer in its sole discretion;
provided, that in no event shall the aggregate amount of all Pre-Approved
Expenditures (as of the Escrow Closing Date specified in the initial Escrow Date
Notification Certificate delivered by Seller pursuant to Section 7.3 hereof)
exceed $7,750,000.
"Purchase Price" has the meaning set forth in Section 2.1 hereof.
"Radon" has the meaning set forth in Section 12.17 hereof.
"Real Estate Assets" means, collectively, the Residential Property
(including the Residential Property with respect to which Seller owns any Joint
Venture Interest), the Commercial Property and the Undeveloped Land, together
with the Personalty, Contracts, Leases and Permits relating thereto, as more
particularly described in Parts I, II and III of Schedule I; it being understood
and agreed that in any event neither the Union Bank Building nor any of the
Other Real Estate Assets shall constitute a portion of the Real Estate Assets.
"Real Estate Taxes" means any ad valorem taxes levied upon the Total
Assets based upon the ownership, leasing, renting or operation of the Total
Assets; provided, however, that Real Estate Taxes shall not include any net
income, capital, stock, succession, transfer, franchise, gift, estate or
inheritance taxes. For avoidance of doubt, Real Estate Taxes shall include,
without limitation, real estate taxes, sales and use taxes, personal property
taxes, sewer rents, water rents, assessments (special or otherwise), transit
taxes, any tax or excise on rent or any other tax (however described) imposed
directly on account of the ownership, leasing, management or operation of, or
rental received for use and occupancy of, any or all of the Total Assets,
whether any such taxes are imposed by the United States, the State or County in
which the Asset or Other Asset, as the case may be, is located or any local
governmental municipality, authority or agency, or any other political
subdivision of any thereof.
"Release" means disposing, discharging, injecting, spilling, leaking,
leaching, dumping, emitting, escaping, emptying, seeping, placing and the like,
into or upon any land or water or air, or otherwise entering into the
environment.
"Required Consents" means the consents, loan document modification
agreements, documents and instruments to be delivered by the parties identified
in Schedule VIII annexed hereto and made a part hereof consenting to the
transactions contemplated by this Agreement and containing terms and provisions
no more onerous to Buyer than those set forth in Schedule VIII and otherwise in
form and substance reasonably satisfactory to Buyer.
"Residential Property" means the real property described in Part II of
Schedule I.
"Savings Plan" has the meaning set forth in Section 11.2(a)(2) hereof.
"Seller" has the meaning set forth in the introductory paragraph.
"7th Avenue Property" means that certain industrial warehouse located
at 0000 Xxxxxxxx Xxxxxx, Xxxxx, Xxxxxxx.
"Subscription Agreement" means the Subscription Agreement, dated as of
January 21, 2000, by and among Xxxxxx Affordable Housing of Florida, Inc., a
Florida corporation, and Echelon and its subsidiaries signatory thereto.
"Subsidiary" means each of the entities signatory hereto other than
Echelon, Buyer and Escrow ---------- Agent.
"Surveys" means the surveys with respect to the Real Estate Assets
described on Schedule XXV annexed hereto and made a part hereof.
"Tangible Personal Property" means the personal property used
primarily in connection with the Total Assets (including, without limitation,
the tangible personal property described in Part VIII of Schedule I) other than
the Intangible Personal Property; provided, that in no event shall "Tangible
Personal Property" include any or all of the Other Tangible Personal Property.
"Tax Credit LP Interest Purchase Agreement" means the Purchase
Agreement, dated as of January 13, 2000, by and between Xxxxxx Affordable
Housing, Inc., a Delaware corporation, Echelon Affordable Housing, Inc., a
Florida corporation, and Echelon.
"Tax Credit LP Interests" means Seller's equity interests in the
limited partnerships described in Part V of Schedule I.
"Tax Return" means any return, report, information return or other
document (including any related or supporting information) filed or required to
be filed with any taxing authority with respect to Taxes.
"Taxes" means all taxes, charges, fees, levies, penalties or other
assessments imposed by any United States federal, state, local or foreign taxing
authority, including, without limitation, income, excise, property, sales and
use, transfer, franchise, payroll, withholding, social security or other taxes,
including any interest, penalties or additions attributable thereto.
"Tender Offer Expiration Date" means the date (as extended from time
to time in accordance with the terms of the Merger Agreement) on which the Offer
expires.
"Title Commitments" means the ALTA owner's title insurance commitments
with respect to the Real Estate Assets described on Schedule XXIV annexed hereto
and made a part hereof.
"Total Assets" means the Assets and the Other Assets, collectively.
"Transferred Employee" has the meaning set forth in Section 11.1
hereof.
"Undeveloped Land" means the real property described in Part III of
Schedule I.
"Union Bank Building" means the 3 1/2-story office building located at
0000 Xxxxxx Xxxxxx, Xxxxxxxx Xxxx, Xxxxxxxxxx.
"WARN" has the meaning set forth in Section 11.2(d) hereof.
Section 2. Purchase and Sale.
2.1 Purchase Price. The aggregate purchase price to be paid by Buyer
to acquire the Assets (the "Purchase Price") shall be equal to (u) $47,921,172,
minus (v) the Minimum Cash Amount, minus (w) the Excess Cash Amount, minus (x)
the Commercial Property Security Deposit Amount, minus (y) the Executive Loans
Repayment Amount, plus (z) the Pre-Approved Expenditures. The Purchase Price
shall be allocated among the Assets, and between the real estate and personal
property comprising the Assets, as set forth on Schedule IV annexed hereto and
made a part hereof.
2.2 Terms of Payment. The Purchase Price will be paid as follows:
(a) On the Agreement Date, Buyer will deliver to Escrow Agent
$4,275,750 (the "Deposit") which will be held in an interest-bearing account
with an institution the deposits in which are insured by an agency of the United
States or, upon joint instructions of Seller and Buyer, invested in securities
of the United States; provided that, in each case, interest accruing thereon
will constitute part of the Deposit.
(b) The Deposit shall be credited to Buyer against the Purchase Price
and will be non-refundable in all instances except as provided in Sections 5.9,
9.2, 10.1, and 10.2 hereof and the balance of the Purchase Price will be paid by
Buyer to Seller in U.S. dollars in immediately available funds at the time of
Closing in accordance with the terms and conditions of this Agreement. The
actual amount of the balance of the Purchase Price payable hereunder shall be
calculated by making reference to the notice to be delivered pursuant to Section
7.4(h) hereof.
2.3 Assumption of Liabilities. On the terms and subject to the
conditions of this Agreement, on the Closing Date, Buyer shall, or shall cause
one or more of its affiliates to, assume and pay, perform and discharge when
due, without duplication, (i) the Existing Debt (as in effect on the Closing
Date), including any prepayment obligations, (ii) any and all liabilities and
obligations of Seller arising out of or related to the Litigation (whether
before, on or after the Closing Date), (iii) any Real Estate Taxes (whether due
or to become due), (iv) any and all liabilities and obligations for which Buyer
is responsible pursuant to Section 11, (v) any and all liabilities and
obligations of Seller arising out of or related to the Permits, Contracts and
Leases (in each case, whether before, on or after the Closing Date), (vi) any
and all liabilities and obligations (including unpaid transaction costs)
relating to any of the Total Assets sold, transferred or otherwise disposed of
pursuant to a Pending Transaction, (vii) any and all liabilities and obligations
of Seller (as of the Closing Date) referred to in the Combining Trial Balance
under the column heading "Real Estate Assets & Liabilities", (viii) any and all
liabilities and obligations of Seller pursuant to Section 11 of the Subscription
Agreement, (ix) any and all liabilities and obligations of Seller arising out of
or related to the Distribution Agreement (excluding all of the Ancillary
Agreements, as defined in the Distribution Agreement), but only to the extent
same arises out of or relates to the Real Estate Assets and/or the Other Real
Estate Assets which were previously conveyed to Seller pursuant to the
Distribution Agreement but in any event excluding (A) any and all liabilities
and obligations of Seller arising out of or related to the Florida Progress
Business and the Echelon Business (as said terms defined in the Distribution
Agreement), except for the assumption of liabilities and obligations by Buyer
pursuant to the preceding provisions of this subclause (ix), (B) any and all
liabilities and obligations of Seller arising out of or related to permits,
contracts or leases which do not constitute Permits, Contracts or Leases
hereunder and (C) any and all liabilities and obligations with respect to
employee agreements and employee matters, except to the extent Buyer is
responsible therefor pursuant to Section 11 and (x) any and all other
liabilities and obligations of Seller arising out of or relating primarily to
any of the Total Assets (including any and all liabilities and obligations of
Seller arising out of the ownership, possession, construction, use, access,
leasing, maintenance, management, replacement, renewal, repair, operation,
enjoyment, alterations, modifications, additions, accessions, improvements,
appurtenances, replacements and substitutions thereof and thereto but excluding
any and all liabilities and obligations of Seller which are expressly not
assumed by Buyer pursuant to preceding subclause (ix)) (collectively, the
"Assumed Liabilities"); provided, that the Assumed Liabilities shall not include
any of (i) the Excluded Liabilities, all of which shall be retained by Seller,
and (ii) the Other Assumed Liabilities, all of which shall be assumed by the
Other Buyer.
Section 3. Seller's Representations and Warranties. Seller makes the
following representations and warranties to Buyer, which representations and
warranties shall not survive the Escrow Closing Date (it being expressly
understood and agreed that, notwithstanding anything to the contrary (express or
implied) set forth herein, in the case of any breach by Seller of any of the
following representations and warranties, Buyer's sole right shall be the
exercise (if it is entitled to do so) of its right of termination pursuant to
Section 9.1(f) hereof (and Buyer's sole remedies in connection therewith shall
be those expressly set forth in Section 9.2 hereof) and Seller shall not at any
time (whether before, on or after the Escrow Closing Date) have any further
liability whatsoever with respect to any such breach of the following
representations and warranties):
3.1 Due Organization and Good Standing of Seller. (a) Echelon is a
corporation duly organized, validly existing and in good standing under the laws
of the jurisdiction of its incorporation and has all requisite corporate power
and authority to own, lease and operate its properties, including the Assets,
and to carry on its business as now being conducted. True and complete copies of
Echelon's Amended and Restated Articles of Incorporation and By-laws, each as in
effect on the Agreement Date, have been previously made available for review to
Buyer. Except as set forth on Schedule XVIII annexed hereto and made a part
hereof, Echelon is duly qualified or licensed to do business and is in good
standing in each jurisdiction in which the property owned, leased or operated by
it or the nature of the business conducted by it makes such qualification
necessary.
(b) Each Subsidiary is an entity duly organized, validly existing and
in good standing under the laws of the jurisdiction of its organization and each
such entity has all requisite corporate, partnership or limited liability
company power and authority to own, lease and operate its properties, including
the Assets, and to carry on its business as now being conducted. True and
complete copies of each Subsidiary's certificate of incorporation, by-laws or
equivalent organizational documents, in each case as in effect on the Agreement
Date, have been previously made available for review to Buyer. Except as set
forth on Schedule XVIII, each Subsidiary is duly qualified or licensed to do
business and is in good standing in each jurisdiction in which the property
owned, leased or operated by it or the nature of the business conducted by it
makes such qualification necessary.
(c) Each of the entities in which Echelon or its relevant Subsidiary
owns a Joint Venture Interest is an entity duly organized, validly existing and
good standing under the laws of the jurisdiction of its organization and each
such entity has all requisite corporate, partnership or limited liability
company power and authority to own, lease and operate its properties and to
carry on its business as now being conducted. True and complete copies of each
such entity's certificate of incorporation, by-laws or equivalent organizational
documents, in each case as in effect on the Agreement Date, have been previously
made available for review to Buyer. Except as set forth on Schedule XVIII, each
such entity is duly qualified or licensed to do business and is in good standing
in each jurisdiction in which the property owned, leased or operated by it or
the nature of the business conducted by it make such qualification necessary.
3.2 Authorization and Validity of Agreement. Seller has the power and
authority to execute and deliver this Agreement, to perform its obligations
hereunder and, subject only to those prohibitions and consents described in
Schedule V, to consummate the transactions contemplated hereby. The execution,
delivery and performance of this Agreement by Seller, and the consummation by it
of the transactions contemplated hereby, have been duly authorized and no other
action on its part is necessary to authorize the execution, delivery and
performance of this Agreement by it and the consummation of the transactions
contemplated hereby (other than complying with those prohibitions and consents
described in Schedule V). This Agreement has been duly executed and delivered by
Seller and, assuming that this Agreement constitutes a valid and binding
obligation of Buyer, is a valid and binding obligation of Seller enforceable
against Seller in accordance with its terms, except to the extent that its
enforceability may be subject to applicable bankruptcy, insolvency,
reorganization, fraudulent transfer, moratorium and similar laws affecting the
enforcement of creditors' rights generally and by general equitable principles.
3.3 Consents and Approvals; No Violations. Assuming any filings
required under the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as
amended (the "HSR Act"), applicable to the sale of Assets to Buyer are made and
any applicable waiting period thereunder has been terminated or has expired, the
execution and delivery of this Agreement by Echelon and its Subsidiaries and the
consummation by Echelon and its Subsidiaries of the transactions contemplated
hereby will not: (a) violate any provision of the Amended and Restated Articles
of Incorporation or By-Laws of Echelon or the comparable governing documents of
any Subsidiary, in each case, as amended; (b) violate any statute, ordinance,
rule, regulation, order or decree of any court or of any governmental or
regulatory body, agency or authority applicable to Echelon or any Subsidiary or
by which any of the Assets may be bound; (c) except as set forth on Schedule V,
require any filing with, or permit, consent or approval of, or the giving of any
notice to, any governmental or regulatory body, agency or authority; or (d)
except as set forth on Schedule V, result in a violation or breach of, conflict
with, constitute (with or without due notice or lapse of time or both) a default
(or give rise to any right of termination, cancellation, payment, purchase, sale
or acceleration) under, or result in the creation of any lien, security
interest, mortgage, charge, claim or encumbrance (each, an "Encumbrance") upon
any of the Assets under, any of the terms, conditions or provisions of, any
note, bond, mortgage, indenture, license, franchise, permit, agreement, lease,
franchise agreement or other instrument or obligation to which Echelon or any
Subsidiary is a party, or by which it or any of their respective Assets are
bound.
3.4 Title to Assets; Encumbrances. Echelon or its relevant Subsidiary,
as applicable, has good and marketable title to the Land and the Improvements
thereon and has good title to the other Assets (other than with respect to the
Employee Loans, with respect to which no representation or warranty is being
made pursuant to this Section 3.4), subject to no Encumbrance or other
restriction of any kind or character, except for (a) liens reflected on Schedule
VI annexed hereto and made a part hereof, (b) zoning, planning or other
governmental restrictions, easements or permits or other restrictions or
limitations on the use of the Real Estate Assets, in each case which would not
have, individually or in the aggregate, a Material Adverse Effect, (c) statutory
liens or liens of landlords, carriers, warehousemen, mechanics, suppliers,
materialmen or repairmen arising in the ordinary course of business and which
would not have, individually or in the aggregate, a Material Adverse Effect and
(d) liens for current Taxes, assessments or governmental charges or levies on
property not yet delinquent. The Commercial Property, the Residential Property
and the Undeveloped Land are owned in fee by Seller and the Real Estate Assets
are the only real property interests that are owned by Seller or in which Seller
has a leasehold or other interest, except for the Tax Credit LP Interests,
certain real property leases under which Seller is the tenant (as more
particularly described in Schedule V) and the Union Bank Building.
3.5 Ownership of Joint Venture Interests. Echelon or the Subsidiary of
Echelon set forth on Schedule VII, as applicable, is the owner and holder of the
Joint Venture Interests described on Schedule VII, free and clear of all
Encumbrances of every kind other than those described in Schedule VII annexed
hereto and made a part hereof. Except as set forth on Schedule VII, Seller has
received no written notice that the organizational documents of the joint
ventures to which the Joint Venture Interests relate are not in full force and
effect, and Seller is not in default of its obligations under such
organizational documents. True and complete copies of the organizational
documents of the joint ventures to which the Joint Venture Interests relate have
been made available for review to Buyer. Schedule VII includes a true and
complete list of all Joint Venture Interests owned by Echelon and its
Subsidiaries, the percentage interest in the entity owned by Echelon or such
Subsidiary, as the case may be, and the percentage interests owned by the other
shareholders, partners or members, as the case may be, in such entity.
3.6 Ownership of Employee Loans. Echelon is the owner and holder of
the Employee Loans, free and clear of all Encumbrances and claims of every kind.
True and complete copies of the documents evidencing the Employee Loans have
been made available for review to Buyer. Except as set forth in Part IX of
Schedule I, the documents evidencing the Employee Loans are in full force and
effect and no defaults on the part of the borrowers or Echelon thereunder have
occurred and are continuing. Except as set forth in Part IX of Schedule I, all
payments of principal and interest in respect of the Employee Loans are current.
Part IX of Schedule I sets forth the outstanding principal balance of each of
the Employee Loans as of the date indicated therein. Seller has not satisfied,
canceled or subordinated any of the promissory notes evidencing the Employee
Loans, in whole or in part.
3.7 Environmental Laws and Regulations. Except as set forth on
Schedule IX annexed hereto and made a part hereof, and subject to Section 12.17
hereof, to the knowledge of Seller:
(i) Hazardous Materials have not been generated, used, treated or
stored by Seller on the Real Estate Assets or the Other Real Estate Assets,
except for quantities generated, used, treated or stored in compliance with
Environmental Laws and as required in connection with the normal operations and
maintenance of such Real Estate Assets or Other Real Estate Assets, as the case
may be;
(ii) Hazardous Materials have not been Released or disposed of by
Seller on the Real Estate Assets or the Other Real Estate Assets, except for
quantities Released or disposed of in compliance with Environmental Laws and as
required in connection with the normal operation and maintenance of such Real
Estate Assets or Other Real Estate Assets, as the case may be;
(iii) Seller is in compliance with Environmental Laws and the
requirements of permits issued under such Environmental Laws with respect to the
Real Estate Assets and the Other Real Estate Assets;
(iv) There are no pending or threatened Environmental Claims against
Seller with respect to the Real Estate Assets or the Other Real Estate Assets;
(v) There are no past or present actions, activities, circumstances,
conditions, events or incidents (including, without limitation, the release,
emission, discharge, presence or disposal of any Hazardous Materials) which
would form the basis for any Environmental Claim against Seller or against any
Person whose liability for any Environmental Claim Seller has retained or
assumed whether contractually or by operation of law, in each case to the extent
same relates to the Real Estate Assets or the Other Real Estate Assets;
(vi) Seller has delivered to or otherwise made available for
inspection by Buyer true, complete and correct copies and results of any
reports, studies, analyses, tests or monitoring in the possession of Seller
pertaining to Hazardous Materials in, on, beneath or adjacent to any Real Estate
Assets or any Other Real Estate Assets; and
(vii) There are no underground storage tanks located on the Real
Estate Assets or the Other Real Estate Assets.
3.8 Leases. Schedule III sets forth all Leases affecting any portions
of any of the Commercial Property and with respect to each Lease, as of the
Agreement Date, the name of the tenant, the location and the gross leasable area
of any space leased, the monthly rent due thereunder, the Lease termination date
and the amount of any security deposits. True and complete copies of such Leases
and the leases relating to the Residential Properties have been made available
for review to Buyer. Except as set forth on Schedule III, each Lease is in full
force and effect, all rents and additional rents due thereunder have been paid
to date, and Seller has neither sent nor received any notice of a material
default under any Lease at a Commercial Property which remains outstanding. The
Commercial Property, the Residential Property and the Undeveloped Land are not
subject to any ground leases.
3.9 Litigation. Schedule XVII annexed hereto and made a part hereof
contains a current list of all actions, suits, arbitrations and proceedings
pending, or to Seller's knowledge threatened, against or concerning the Total
Assets (collectively, "Litigation"). To Seller's knowledge, there are no
judgments, orders or decrees entered in any lawsuit or proceeding against or
concerning the Total Assets, other than as set forth on Schedule XVII. Seller
has received no written notice of any pending or threatened condemnation, taking
or similar proceeding affecting the Total Assets, or any pending public
improvements which would result in, nor has Seller received written notice of,
special assessments affecting the Total Assets.
3.10 Land Use. With respect to the Real Estate Assets, Seller has not
received any written notice from any governmental authority, and Seller
otherwise has no knowledge, that a Real Estate Asset is not in substantial
compliance with the County regulations and restrictions applicable to the zoning
district within which it is situated, and, except as described in Schedule XVI
annexed hereto and made a part hereof, Seller has no actual knowledge of any
covenants, restrictions or other agreements with or in favor of any governmental
authority or other Person limiting in any material respect the use of any of the
Real Estate Assets for the purposes permitted by the regulations governing the
applicable zoning district.
3.11 Contracts. Except for the Leases, Encumbrances on title and the
documents and instruments relating to the Existing Debt, Schedule XI sets forth
all agreements, contracts and commitments by which Seller is bound primarily
affecting or relating to the Total Assets other than such contracts, agreements
or commitments that involve base payments or the performance of services by
Seller of an amount or value (as measured by the revenue derived therefrom
during fiscal year 1998-1999) not in excess of $12,000 annually or are
terminable by Seller on not more than 90 days notice without penalty. True and
complete copies of all of the agreements, contracts and commitments referred to
in Schedule XI have been made available for review to Buyer. Except as otherwise
set forth on Schedules V and XI, each agreement, contract and commitment
referred to in Schedule XI is in force and effect and (a) there exists no
default or event of default thereunder (or any event, occurrence, condition or
act on the part of Seller which, with the giving of notice, the lapse of time or
the happening of any other event or condition, would become a default or event
of default thereunder) and (b) no approval or consent of, or notice to, any
Person is needed in order that each such contract or agreement shall continue in
force and effect in accordance with its terms without penalty, acceleration or
rights of early termination by reason of the consummation of the transactions
contemplated by this Agreement.
3.12 Existing Debt. Echelon or its relevant Subsidiary, as applicable,
is the borrower under the Existing Debt encumbering the Assets owned by it, as
more particularly set forth on Schedule II. Except as set forth on Schedule II,
the documents evidencing and securing the Existing Debt are in full force and
effect and no defaults on the part of the borrower or the lender thereunder have
occurred and are continuing. Except for the Existing Debt and except for debt
incurred in connection with Pending Transactions, no other indebtedness for
borrowed money encumbers any of the Assets. Except as set forth on Schedule II,
all payments of principal and interest in respect of the Existing Debt are
current. True and complete copies of all agreements evidencing and securing the
Existing Debt have been made available for review to Buyer.
3.13 Employee Benefit Plans; Labor Matters. Each employee benefit plan
within the meaning of Section 3(3) of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"), and all stock purchase, stock option,
severance, employment, change-in-control, fringe benefit, collective bargaining,
bonus, incentive, deferred compensation and all other employee benefit plans,
programs, policies or agreements, whether or not subject to ERISA (including any
funding mechanism therefor now in effect or required in the future as a result
of the transactions contemplated by this Agreement or otherwise) maintained by
Seller (including for purposes of this Section 3.13, all employers that would be
treated, together with Seller, as a single employer within the meaning of
Section 414(b) and (c) of the Internal Revenue Code of 1986, as amended (the
"Code")) or to which Seller contributes or has current or contingent liability
(collectively, the "Employee Benefit Plans") is listed on Schedule XII annexed
hereto and made a part hereof. Seller does not contribute and has not
contributed during the past six years to any "multiemployer plan" within the
meaning of Section 4001(a)(3) of ERISA, and Seller is not subject to any
withdrawal liability under Title IV of ERISA with respect to any such plan. No
Employee Benefit Plan is subject to Title IV of ERISA or Section 412 of the
Code. Seller has not incurred and does not reasonably expect to incur any
liability under Title IV of ERISA. No Employee Benefit Plan provides for
post-employment or post-retirement health or medical or life insurance benefits
for retired or former employees of Seller or its affiliates, except as required
to avoid excise tax under Section 4980B of the Code. Except as set forth on
Schedule XII: (i) each Employee Benefit Plan is in substantial compliance with
applicable law and has been administered and operated in all material respects
in accordance with its terms; (ii) each Employee Benefit Plan which is intended
to be "qualified" within the meaning of Section 401(a) of the Code has received
a favorable determination letter from the Internal Revenue Service and, to the
knowledge of Seller, no event has occurred and no condition exists which would
result in the revocation of any such determination; (iii) neither Seller, nor
any other "disqualified person" or "party in interest" (as defined in Section
4975(e)(2) of the Code and Section 3(14) of ERISA, respectively) has engaged in
any transaction in connection with any Employee Benefit Plan that would result
in the imposition of a material penalty pursuant to Section 502(i) of ERISA or a
material tax pursuant to Section 4975 of the Code and no event has occurred and
no condition exists that would otherwise subject Seller to any material excise
tax, penalty, fine or lien imposed by ERISA or the Code with respect to an
Employee Benefit Plan; and (iv) no claim, action or litigation, has been made,
commenced or, to the knowledge of Seller, threatened with respect to any
Employee Benefit Plan (other than routine claims for benefits payable in the
ordinary course, and appeals of denied such claims). Except as provided by or
under the agreements and arrangements described on Schedules XII and XIII, the
execution of this Agreement and the consummation of the transactions
contemplated hereby will not result in any material payment to or accelerate the
vesting of benefits of any employee of Seller under any Employee Benefit Plan or
other plan, policy or agreement of Seller. With respect to each Employee Benefit
Plan, Seller has delivered or made available for review to Buyer or its counsel
a true and complete copy of, to the extent applicable: (a) the plan document
(including any amendments thereto) and any related trust agreement or other
funding instrument, (b) the most recent Internal Revenue Service determination
letter, (c) the summary plan description and (d) the annual report most recently
filed on Internal Revenue Service Form 5500-series.
3.14 Intellectual Property. (a) Schedule XIV sets forth a true and
complete list of all Intellectual Property, specifying, if applicable, the
registration or application numbers for each such Intellectual Property, owned
by or licensed to Echelon and/or its subsidiaries. Other than as set forth on
Schedule XIV, neither Echelon nor any of its subsidiaries owns or uses any other
item of intellectual property which is material to the Total Assets.
(b) Except as set forth on Schedule XIV, Echelon and/or its
subsidiaries own or have the valid and enforceable right to use all Intellectual
Property in the manner such Intellectual Property is being used or held for use
by Echelon and/or its subsidiaries.
(c) Except as set forth on Schedule XVII, neither Echelon nor any of
its subsidiaries (or any of their respective affiliates) is a defendant in any
investigation or proceeding relating to, or otherwise has been notified of, any
alleged claim of infringement with respect to the Intellectual Property and, to
Seller's knowledge, use of the Intellectual Property in connection with the
Total Assets as currently conducted does not infringe upon any third party
proprietary rights.
(d) There is no outstanding claim or suit brought by Echelon or its
subsidiaries (or any of their respective affiliates) for infringement by any
other Person of any of the Intellectual Property.
(e) Except as set forth on Schedule XIV, there are no licenses,
sublicenses or other agreements relating to the Intellectual Property pursuant
to which Echelon or its subsidiaries (or any of their respective affiliates) is
authorized to use any Intellectual Property owned or controlled by a third
party, and no third party is authorized to use any Intellectual Property owned
or controlled by Echelon or its subsidiaries (or any of their respective
affiliates). Echelon and its subsidiaries are not, nor as a result of the
execution, delivery or performance of their obligations hereunder will Echelon
or its subsidiaries be, in violation of, or lose any rights pursuant to, any
license or agreement described in Schedule XIV.
(f) To the knowledge of Seller, there has not been and there is not
currently any unauthorized use, infringement or misappropriation of any of the
Intellectual Property by any other Person, including any employee or former
employee of Echelon and/or its subsidiaries.
3.15 Insurance. Schedule XXII annexed hereto and made a part hereof
sets forth a true and complete listing of all insurance policies maintained by
Seller on and as of the Agreement Date relating to the Real Estate Assets or the
Other Real Estate Assets, with the amounts insured (and any deductibles) set
forth therein.
3.16 Assets. The Total Assets are all of the assets used in Seller's
real estate business or which are reasonably necessary for Seller's real estate
business to function and operate as an on-going concern in substantially the
same manner as Seller's real estate business has recently functioned and
operated as an on-going concern; it being understood and agreed, for avoidance
of doubt, that, for purposes of this Section 3.16, none of the Excepted Leases
or the Tax Credit LP Interests relate to Seller's real estate business.
3.17 Reports and Financial Statements. (a) Since December 18, 1996,
Seller has filed all forms, reports and documents with the Securities and
Exchange Commission (the "Commission") required to be filed by it pursuant to
the federal securities laws and the Commission rules and regulations thereunder,
and all forms, reports and documents filed with the Commission by Seller have
complied in all material respects with all applicable requirements of the
federal securities laws and the Commission rules and regulations promulgated
thereunder. Seller has, prior to the date of this Agreement, made available for
review to Buyer true and complete copies of all forms, reports, registration
statements and other filings filed by Seller with the Commission since December
18, 1996 (such forms, reports, registration statements and other filings,
together with any exhibits, any amendments thereto and information incorporated
by reference therein, are sometimes collectively referred to as the "Commission
Filings"). Except to the extent amended or superseded by a subsequent filing
with the Commission made prior to the date hereof, as of their respective dates,
the Commission Filings did not contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading. The audited consolidated balance sheets (and related
audited consolidated statements of operations, audited consolidated statement of
shareholders' equity and audited consolidated statement of cash flows) for each
of the years in the two-year period ended December 31, 1998 and the unaudited
consolidated balance sheet (and related consolidated statement of operations,
consolidated statement of shareholders' equity and consolidated statement of
cash flows) as of September 30, 1999 (such statements, collectively, the
"Financial Statements"), included in the Commission Filings, were prepared in
accordance with generally accepted accounting principles ("GAAP") (as in effect
from time to time) applied on a consistent basis in all material respects,
(except as may be indicated therein or in the notes or schedules thereto) and
fairly present, in all material respects, the consolidated financial position of
Echelon and its consolidated subsidiaries as of the dates thereof and the
results of their operations and changes in cash flows for the periods then ended
(subject, in the case of unaudited statements, to the absence of notes and
normal year-end adjustments).
(b) Part I of Schedule XXI sets forth the trial balance of the assets,
liabilities and shareholders' equity accounts of Echelon and its consolidated
Subsidiaries as of September 30, 1999. Each such account reflected on the trial
balance has been included in or allocated between (x) Seller's leveraged lease
portfolio and (y) Seller's real estate portfolio, as agreed to by the parties
hereto.
(c) Part II of Schedule XXI sets forth the condensed consolidated
financial statements of Echelon and its consolidated Subsidiaries as of and for
the three and nine month periods ended September 30, 1999 together with the
report of KPMG LLP dated October 15, 1999. The balance sheet included in such
condensed consolidated financial statements was prepared from and is consistent
with the trial balance referred to in Section 3.17(b) hereof.
3.18 Absence of Certain Changes. Except as previously disclosed in the
Commission Filings, as set forth on Schedule XIX annexed hereto and made a part
hereof or as otherwise contemplated by this Agreement, since September 30, 1999
(i) there has not been any Material Adverse Effect, other than any change (x)
arising out of changes in general economic conditions or (y) arising out of
economic changes which affect, in general, the markets in which Echelon operates
and (ii) the businesses of Echelon and each of its subsidiaries have been
conducted only in the ordinary course.
3.19 Liabilities. Seller has no material claims, liabilities or
indebtedness outstanding which would be required to be reflected on a balance
sheet prepared in accordance with GAAP except (i) as set forth in the Financial
Statements, or referred to in the footnotes thereto, (ii) as set forth on
Schedule XXI, (iii) for liabilities incurred subsequent to September 30, 1999 in
the ordinary course of business or (iv) as otherwise disclosed in the Commission
Filings.
3.20 Compliance with Laws. Except as set forth in the Commission
Filings or as set forth on Schedule XX annexed hereto and made a part hereof,
Seller is in compliance with all applicable laws, regulations, orders, judgments
and decrees (other than with respect to Taxes, environmental matters, employee
benefits and federal securities laws, which are the subject of specific
representations contained in this Agreement).
3.21 Year 2000. There is not reasonably expected to be a Material
Adverse Effect caused by the failure to be Year 2000 Compliant with respect to
computer systems, computer software or technology that are internal to Seller.
There is not reasonably expected to be a Material Adverse Effect caused by the
failure to be Year 2000 Compliant of any products or services of Seller sold or
licensed to customers of Seller. For purposes of this Agreement, "Year 2000
Compliant" means that a product or system is (i) able to receive, record, store,
process, calculate, manipulate and output dates from and after January 1, 2000,
time periods that include January 1, 2000 and information that is dependent on
or relates to such dates or time periods, in the same manner and with the same
accuracy, functionality, data integrity and performance as when dates or time
periods prior to January 1, 2000 are involved and (ii) able to store and output
date information in a manner that is unambiguous as to century.
3.22 No Other Representations or Warranties. Except for the
representations and warranties contained in this Section 3 and in Section 8
hereof, neither Seller nor any other Person makes any other express or implied
representation or warranty on behalf of Seller or any of its affiliates.
Section 4. Buyer's Representations and Warranties. Buyer makes the
following representations and warranties to Seller, which representations and
warranties shall not survive the Escrow Closing Date, except for (x) those
representations and warranties set forth in Sections 4.4, 4.5 and 4.6 hereof
which shall survive for a period of one year after the Closing Date and (y)
those representations, warranties and agreements set forth in Section 4.9 hereof
which shall survive as set forth therein:
4.1 Due Organization and Good Standing of Buyer. Buyer is a limited
liability company duly organized, validly existing and in good standing under
the laws of the State of Delaware. Buyer has all requisite limited liability
company power and authority to own, lease and operate its properties and to
carry on its business as now being conducted. Buyer is duly qualified or
licensed to do business in Delaware and will, on or prior to the Closing Date,
qualify to do business in each jurisdiction where the Assets are located.
4.2 Authorization and Validity of Agreement. Buyer has the power and
authority to execute and deliver this Agreement, to perform its obligations
hereunder and consummate the transactions contemplated hereby. The execution,
delivery and performance of this Agreement by Buyer, and the consummation by it
of the transactions contemplated hereby, have been duly authorized by the member
or manager of Buyer and no other limited liability company action on the part of
Buyer is necessary to authorize the execution, delivery and performance of this
Agreement by Buyer and the consummation of the transactions contemplated hereby.
This Agreement has been duly executed and delivered by Buyer and is a valid and
binding obligation of Buyer enforceable against Buyer in accordance with its
terms, except to the extent that its enforceability may be subject to applicable
bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium and
similar laws affecting the enforcement of creditors' rights generally and by
general equitable principles.
4.3 Consents and Approvals; No Violations. Assuming any filings
required under the HSR Act applicable to the sale of Assets to Buyer are made
and any applicable waiting period thereunder has been terminated or has expired,
the execution and delivery of this Agreement by Buyer and the consummation by
Buyer of the transactions contemplated hereby will not: (a) violate any
provision of the certificate of formation or operating agreement of Buyer; (b)
violate any statute, ordinance, rule, regulation, order or decree of any court
or of any governmental or regulatory body, agency or authority applicable to
Buyer or by which any of its properties or assets may be bound; (c) require any
filing with, or permit, consent or approval of, or the giving of any notice to,
any governmental or regulatory body, agency or authority; or (d) result in a
violation or breach of, conflict with, constitute (with or without due notice or
lapse of time or both) a default (or give rise to any right of termination,
cancellation, payment or acceleration) under, or result in the creation of any
Encumbrance upon any of the property or assets of Buyer under, any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, license,
franchise, permit, agreement, lease, franchise agreement or other instrument or
obligation to which Buyer is a party, or by which it or its assets are bound
except, in the case of clauses (b), (c) and (d), above, for any such filing,
permit, consent, approval or notice, the failure to obtain or make which, and
except for any breach, violation or Encumbrance which, would not prevent or
materially delay the consummation of the transactions contemplated by this
Agreement.
4.4 Condition of the Assets. Buyer has conducted all due diligence
that Buyer deems necessary or desirable with respect to the Total Assets, the
Assumed Liabilities, the Other Assumed Liabilities, this Agreement and the
transactions contemplated hereby in order for it to enter into this Agreement
and consummate the transactions contemplated hereby. Except for the limited
representations of Seller specifically set forth in Section 3 hereof, Buyer will
rely solely upon such due diligence in acquiring the Assets and in assuming the
Assumed Liabilities. Without limiting the generality of the foregoing, Buyer
acknowledges that Seller makes and will make no representation or warranty
concerning environmental conditions heretofore, now or hereafter existing on
properties adjoining or proximate to the Total Assets. Notwithstanding anything
in this Agreement, it is expressly understood and agreed that Buyer is acquiring
the Assets "AS IS", "WHERE IS" and "WITH ALL FAULTS", and that Seller has not
made and does not and will not make any representations or warranties, express
or implied, including any with respect to the quality, physical condition,
expenses, legal status, zoning, value, utility or development or operating
potential of the Total Assets, or the absence of any Hazardous Substances on,
in, under or near the Total Assets, or any other matter or thing affecting or
relating to the Total Assets, the Assumed Liabilities, the Other Assumed
Liabilities or this Agreement (including, without limitation, warranties of
merchantability and/or of fitness for a particular purpose) which might be
pertinent in considering whether to purchase the Assets, assume the Assumed
Liabilities or to make and enter into this Agreement, except, in each case, to
the extent of the limited representations set forth in Section 3 hereof. Seller
is not liable or bound in any manner by any warranties, either expressed or
implied, guaranties, or any promises, statements, representations or information
pertaining to the Total Assets or to the value thereof made or furnished by any
broker or any real estate agent, employee, servant or other Person representing
or purporting to represent Seller. As of the Agreement Date, Buyer is not aware
of any events, facts or circumstances which, individually or in the aggregate,
have or would have a Material Adverse Effect.
4.5 Liens. Buyer acknowledges that it is acquiring the Assets subject
to the matters described in Schedules VI, VII and VIII and the Existing Debt
described in Schedule II, and such other matters as are permitted pursuant to
the terms of this Agreement.
4.6 Purchase for Investment. Buyer will acquire the Joint Venture
Interests for its own account for investment and not with a view toward any
resale or distribution thereof, without prejudice, however, to the rights of
Buyer at all times to sell or otherwise dispose of all or any part of such
securities under an effective registration statement under the Securities Act of
1933, as amended, or under an exemption from such registration available under
the Securities Act of 1933, as amended.
4.7 Sufficient Funds. Buyer has sufficient funds available to it to
purchase the Assets pursuant to this Agreement and will not, prior to Closing,
incur third party debt to finance any portion of the Purchase Price (it being
understood and acknowledged that concurrently with the execution and delivery of
this Agreement by the parties hereto, each of the Subscription Agreement and the
Xxxxxx Lease (in each case, executed copies of which have heretofore been made
available to Seller) shall have been executed and delivered by the respective
parties thereto.)
4.8 Title and Survey. Prior to the Agreement Date, Buyer has reviewed
(i) the Title Commitments or other reports with respect to the Real Estate
Assets described on Schedule XXIV and (ii) the Surveys with respect to the Real
Estate Assets described on Schedule XXV. Buyer hereby acknowledges its approval
as of the Agreement Date of the condition of title to the Real Estate Assets,
subject to Seller's fulfilling its obligation to deliver the documents described
in Sections 7.4(b)(x) through (b)(xiii), inclusive, hereof.
4.9 Inspection. Prior to the Agreement Date, Buyer has inspected the
Total Assets and any operating files maintained by Seller or its property
managers in connection with the ownership, leasing, maintenance and/or
management of the Total Assets, including, without limitation, the Leases, lease
files, operating agreements, insurance policies, bills, invoices, receipts and
other general records relating to the Total Assets, correspondence, surveys,
plans and specifications, warranties for services and materials provided,
environmental assessments and similar materials, in each case, as Buyer has
deemed necessary in connection with making its determination to execute and
deliver this Agreement. Buyer hereby indemnifies Seller and holds Seller
harmless from and against any claim for liabilities, costs, expenses (including
reasonable attorney's fees), damages or injuries arising out of or resulting
from physical injury or damages to persons or property resulting from the
inspections of the Total Assets by Buyer or its agents other than injury or
damages resulting from Seller's gross negligence or willful misconduct, and such
indemnity shall survive Closing or any termination of this Agreement.
4.10 No Other Representations or Warranties. Except for the
representations and warranties contained in this Section 4 and in Section 8
hereof, neither Buyer nor any other Person makes any other express or implied
representation or warranty on behalf of Buyer or any of its affiliates.
Section 5. Covenants.
5.1 Compliance. During the period commencing on the Agreement Date and
ending on the Closing Date, Seller will, in all material respects, comply with
and abide by all of the covenants, conditions and requirements set forth or
imposed by, related to or arising out of all statutes, laws, ordinances, rules,
regulations, plans and specifications, permits, agreements, contracts,
authorizations or approvals related or applicable to any portion of the Assets,
and will use commercially reasonable efforts to maintain all contracts, permits
and other agreements affecting the Assets in good standing and free from
delinquency or material default, other than those which are modified, rescinded
or terminated in the ordinary course of business or in connection with Pending
Transactions and those the rescission, modification or termination of which
would not reasonably be expected to have a Material Adverse Effect.
5.2 Notices of Violations. During the period commencing on the
Agreement Date and ending on the Closing Date, in the event that Seller receives
any notice from any County, or any other governmental or quasi-governmental
authority having jurisdiction over any of the Real Estate Assets, of a violation
or alleged violation of any statute, law, ordinance, rule, permit, regulation or
agreement governing the planning, development, construction, occupancy, use or
maintenance of any portion of any of the Real Estate Assets, or of any permit,
approval or authorization issued in connection therewith or of any contemplated
or pending investigation with respect thereto, Seller promptly will deliver a
copy of such notice to Buyer; and Buyer will have the option (but will not be
required) either to (a) participate with Seller in responding to such notice or
(b) seek independently to intervene in any proceeding of which notice has been
given for the purpose of protecting Buyer's interests in and with respect to any
of the Real Estate Assets.
5.3 Ownership of Assets; Proceeds of Asset Sales. During the period
commencing on the Agreement Date and ending on the Closing Date, Seller shall
not without the prior consent of Buyer (which consent shall not be unreasonably
withheld, conditioned or delayed) directly or indirectly sell, transfer,
encumber or otherwise dispose of any of the Assets or any portion thereof to any
Person, other than sales, transfers or other dispositions of Assets (i)
constituting non-material equipment or personalty made in the ordinary course of
business, (ii) as contemplated by Sections 10.1 and 10.2 hereof, (iii)
constituting overdue accounts receivable arising in the ordinary course of
business, but only in connection with the compromise or collection thereof
consistent with sound business practices (and not as a part of any bulk sale or
financing of receivables) or (iv) pursuant to any or all of the transactions
described in Schedule XV (collectively, the "Pending Transactions"); provided,
that the Net Sale Proceeds from any sale, transfer, encumbrance or disposition
of Assets, in whole or in part, pursuant to any Pending Transaction consummated
after the Agreement Date and prior to the Closing Date (collectively, the "Asset
Sales Proceeds") shall be promptly delivered by Seller to Escrow Agent, and such
Asset Sales Proceeds shall be held in an interest-bearing account with an
institution the deposits in which are insured by an agency of the United States
or, upon joint instructions of Seller and Buyer, invested in securities of the
United States; provided that, in each case, interest accruing thereon will
constitute part of such Asset Sales Proceeds.
5.4 Operation of Assets Subsequent to the Agreement Date. Seller
agrees that, except for Pending Transactions (including all transactions
incident thereto as set forth on Schedule XV, such as (i) the incurrence of
indebtedness for borrowed money and (ii) the incurrence of capital expenditures)
and except as required or contemplated by this Agreement, the Subscription
Agreement, the Tax Credit LP Interest Purchase Agreement or the Merger Agreement
or otherwise consented to or approved by Buyer (which consent or approval shall
not be unreasonably withheld, conditioned or delayed), during the period
commencing on the Agreement Date and ending on the Closing Date:
a)(a) Echelon will, and will cause its Subsidiaries
to, operate, manage and maintain the Assets and otherwise conduct its business
relating to the Assets only according to its ordinary course of business
consistent with past practice and will use reasonable best efforts to preserve
intact its business organization, keep available the services of its officers
and employees and maintain satisfactory relationships with licensors, suppliers,
distributors, clients, landlords, tenants, joint venture partners, employees and
others having business relationships with it;
b)(b) Echelon shall not, and shall cause its Subsidiaries not to, (i)
make any change in or amendment to its articles of incorporation or by-laws or
comparable governing documents (including, without limitation, documents
governing Seller's Joint Venture Interests, but excluding documents governing
Seller's Tax Credit LP Interests); (ii) authorize for issuance, issue, sell or
deliver (or agree or commit to issue, sell or deliver), whether pursuant to the
issuance or granting of options, warrants, commitments, subscriptions, rights to
purchase or otherwise, any shares of its capital stock (other than in connection
with (A) the exercise of certain options outstanding on the date hereof or (B)
the exercise of subscription rights set forth in the Echelon International
Corporation 1996 Employee Stock Purchase Plan (as in effect on the date hereof
and as may be amended as contemplated by the Merger Agreement)); (iii) sell or
pledge any stock owned by it in any of its Subsidiaries or any other entity in
which it has an equity interest (including the issuers of the Joint Venture
Interests, but excluding the issuers of Tax Credit LP Interests); (iv) enter
into any contract or commitment with respect to capital expenditures; (v)
acquire (by merger, consolidation, or acquisition of stock or assets or
otherwise) any corporation, partnership or other business or division thereof
(or any interest therein); provided, that any subsidiary of Echelon may be
merged with and into Echelon or any other subsidiary of Echelon; (vi) acquire a
material amount of assets or securities; (vii) except to the extent required
under existing Employee Benefit Plans as in effect on the date of this
Agreement, (A) increase the compensation or fringe benefits of any of its
directors, officers or employees, (B) grant any severance or termination pay not
currently required to be paid under existing severance plans, (C) enter into any
employment, consulting or severance agreement or arrangement with any present or
former director, officer or other employee of Seller or (D) establish, adopt,
enter into or amend or terminate any collective bargaining, bonus, profit
sharing, thrift, compensation, stock option, restricted stock, pension,
retirement, deferred compensation, employment, termination, severance or other
plan, agreement, trust, fund, policy or arrangement for the benefit of any
directors, officers or employees; (viii) except as provided in Sections 5.3 and
5.5 hereof, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose
of, encumber or subject to any lien, any material assets or incur or modify any
new or existing indebtedness for borrowed money; (ix) make any material Tax
election or settle or compromise any material Tax liability, in each case only
to the extent same would adversely affect the Assets; (x) except as required by
applicable law or GAAP, make any material change in its method of accounting;
(xi) adopt a plan of complete or partial liquidation, dissolution, merger,
consolidation, restructuring, recapitalization or other reorganization of
Echelon or any of its Subsidiaries that owns any Assets (other than in
connection with (A) the Merger or (B) any merger of a subsidiary of Echelon with
and into Echelon or any other subsidiary of Echelon); (xii) except pursuant to
any contract relating to any Pending Transaction, make any loans, advances or
capital contributions to, or investment in, any other Person; (xiii) declare,
set aside or pay any dividends on, or make any other distributions in respect
of, any of its capital stock other than dividends and distributions by a direct
or indirect subsidiary of Echelon to its parent; (xiv) split, combine or
reclassify any of its capital stock or issue or authorize the issuance of any
other securities in respect of, in lieu of or in substitution for shares of its
capital stock; (xv) enter into any agreement providing for the acceleration of
payment or performance or other consequence as a result of the transactions
contemplated hereby or any other change of control of Echelon or its
subsidiaries other than with respect to the satisfaction of Existing Debt; (xvi)
purchase, redeem or otherwise acquire any shares of capital stock of Seller or
any rights, warrants or options to acquire any such shares or other securities;
or (xvii) agree, in writing or otherwise, to take any of the foregoing actions;
and
(c) Echelon shall not, and shall not permit any of its Subsidiaries
to, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of,
encumber or subject to any lien any of the Assets associated with the general
ledger accounts listed in Schedule XXIII annexed hereto and made a part hereof
for any purpose (including, without limitation, for the purpose of satisfying
any Excluded Liabilities) except as related to, and for the benefit of, the
Assets.
5.5 Status of Agreements. (a) During the period commencing on the
Agreement Date and ending on the Closing Date, except in connection with Pending
Transactions, the Required Consents or as set forth on Schedule V or otherwise
consented to or approved by Buyer (which consent or approval shall not be
unreasonably withheld, conditioned or delayed), Seller will not do any of the
following:
(i) cancel or amend or modify in any material respect, (x) any
Contract or Lease affecting any of the Real Estate Assets or (y) any agreements,
documents or instruments relating to the Existing Debt;
(ii) enter into any new contract, agreement or commitment (other than
(x) a contract, agreement or commitment that involves base payments or the
performance of services by Seller of an amount or value (as measured by the
revenue derived therefrom during fiscal year 1998-1999) not in excess of $12,000
annually or terminable by Seller on not more than 90 days notice without
penalty, or (y) a contract, agreement or commitment that is entered into (A) in
order to preserve public safety as to one or more Assets or (B) as a result of
an emergency situation or force majeure event affecting one or more Assets), any
new Lease (other than a Lease demising space of less than 5000 square feet on
terms and conditions consistent with the current leasing practices of the
subject property and otherwise consistent with good business practice) affecting
any of the Real Estate Assets or any new agreements, documents or instruments
relating to the Existing Debt; or
(iii) intentionally do any act or omit to do any act that will cause a
material breach of any Contract or Lease or agreements, documents or instruments
relating to the Existing Debt.
(b) During the period commencing on the Agreement Date and ending on
the Closing Date, Echelon will not, without the prior consent of Buyer (not to
be unreasonably withheld, conditioned or delayed), amend, modify or supplement
the Merger Agreement (including the Schedules and Exhibits thereto) or grant any
consent or waiver under the Merger Agreement, in each case that would in any
manner materially and adversely affect the rights, obligations and interests of
Buyer under this Agreement (it being expressly understood and agreed that in no
event shall Section 4.07 or Section 5.01 of the Merger Agreement be amended,
modified or supplemented (and in no event shall Seller grant any consent or
waiver with respect to any such Section) without the prior consent of Buyer (not
to be unreasonably withheld, conditioned or delayed)). The parties hereto
acknowledge that Buyer is a third party beneficiary of the agreements made by
Echelon pursuant to Section 4.07 of the Merger Agreement and that Seller shall
be required to provide Buyer with any and all information required to be
provided to Parent (as defined in the Merger Agreement) pursuant to Section
4.07(c) of the Merger Agreement. Nothing in this Section 5.5(b), however, shall
in any manner whatsoever require that the Board of Directors of Echelon take any
action or refrain from taking any action, in each case which is permitted under
Section 4.07 of the Merger Agreement.
5.6 Further Assurances. On or after the Closing Date and without
further consideration, each of Seller and Buyer shall execute, acknowledge and
deliver such further agreements, assignments, deeds, certificates, assumptions,
transfers and assurances and shall take, or cause to be taken, such further
actions, in each case, as shall be reasonably requested by Buyer or Seller from
time to time for the more effective transfer, assignment and conveyance to Buyer
of any of the Assets or the Assumed Liabilities, including without limitation,
obtaining the consent of third parties (without obligating Buyer or Seller or
their respective affiliates to spend money or assume obligations in connection
therewith), as, in the reasonable opinion of Buyer or Seller, as the case may
be, or their respective counsel, are necessary to transfer, assign and convey
the Assets to Buyer, the assumption by Buyer of the Assumed Liabilities, the
consummation of the transactions contemplated by this Agreement or otherwise in
the effectuation of the intentions and purposes of this Agreement; provided,
that all reasonable out-of-pocket costs and expenses incurred in connection with
any of the foregoing actions shall be for the account of the party requesting
such actions subject, in each case, to providing reasonable documentation of
such out-of-pocket costs and expenses, unless such actions relate to the Assumed
Liabilities, in which case all reasonable out-of-pocket costs and expenses in
connection therewith shall be for the account of Buyer (irrespective of whether
such actions were at the request of Seller or Buyer). In addition to and not in
limitation of the foregoing provisions of this Section 5.6, Buyer shall,
promptly following Closing, (i) establish all bank accounts necessary to hold
the security deposits delivered by tenants pursuant to the Leases, and shall
fund such accounts out of its own funds in amounts equal to the security
deposits held by Seller in respect thereof at Closing (including any interest
accrued thereon), (ii) deliver notices to the tenants who deposited such
security deposits under such Leases, confirming that Buyer is holding such
security deposits, the accounts where same are held and the amount of such
security deposits and (iii) take any and all other actions as required by
applicable law with respect to the security deposits, if any, delivered by
tenants pursuant to the Leases or the leases relating to the Residential
Properties. The provisions of this Section 5.6 shall survive Closing for a
period of one year from the Closing Date.
5.7 Consents. To the extent that a claim can be made successfully that
the transactions contemplated hereby will constitute the assignment of any
contract, lease, commitment, sales order, purchase order, account, license,
permit or undertaking requiring the consent of another party thereto, this
Agreement shall not constitute an agreement to assign the same if an attempted
assignment would constitute a breach thereof. During the period commencing on
the Agreement Date and ending on the Closing Date, Seller agrees that it will
use its commercially reasonable efforts (without obligating Seller or its
affiliates to spend money or assume obligations in connection therewith) to
obtain the written consent of the other necessary parties to the assignment of
such contracts, leases, commitments, sales orders, purchase orders, accounts,
licenses, permits and undertakings, and if such consent is not obtained, Seller
will use commercially reasonable efforts (without obligating Seller or its
affiliates to spend money or assume obligations in connection therewith) to
cooperate with Buyer in any lawful arrangement designed to provide Buyer the
benefits under any such documents.
5.8 Use of Business Names by Buyer. From and after the Closing Date,
Seller acknowledges that Buyer has the absolute and exclusive proprietary right
to the name "Echelon" as used in relation to the Assets or any name confusingly
similar to the foregoing and to all trademarks, trade names, logos and signage
incorporating "Echelon" or any name confusingly similar to the foregoing. All
rights of Seller and its respective affiliates in and to any trademarks, trade
names, logos, tag lines and signage incorporating "Echelon" and the goodwill
represented thereby and pertaining thereto have been assigned to Buyer pursuant
to this Agreement. Accordingly, Seller agrees that it will not, and will cause
its affiliates not to, use (i) the name "Echelon" or any name confusingly
similar to the foregoing or any trademark, logo, tag lines or signage
incorporating the name "Echelon" or any name confusingly similar to the
foregoing and (ii) the Intellectual Property in any manner, including in
connection with the sale of any products or services or otherwise in the conduct
of its business. Notwithstanding the foregoing, for a period of 180 days after
the Closing Date, Seller shall have the right to use the word "Echelon" as its
tradename, but only for the purposes of identifying itself as the appropriate
business entity in dealing with third Persons (i) to facilitate the sale of the
Assets to Buyer and the transfer of the Other Assets to the Other Buyer and (ii)
in connection with the management of, and any sale to any third party purchaser
of, Seller's interest in the assets subject to the Excepted Leases, and not for
any other purpose, including, without limitation, use of "Echelon" as a
trademark for the purpose of marketing or promoting any product or service.
5.9 Bringdown of Seller's Representations. On the Escrow Closing Date,
Seller shall deliver to Buyer a certificate (a "Bringdown Certificate") executed
by the President, any Vice President or a managing member of each of Echelon and
its subsidiaries signatory hereto certifying that, as of the Escrow Closing
Date, the representations and warranties made by Seller in this Agreement are
true and correct in all material respects, except for a change in facts and
circumstances which requires a change in any such representation and warranty,
and in such event the certificate shall specify any such change in reasonable
detail. Seller's representations and warranties set forth in such certificate
shall not survive the Escrow Closing Date (it being expressly understood and
agreed that, notwithstanding anything to the contrary (express or implied) set
forth herein, in the case of any breach by Seller of any of Seller's
representations and warranties, Buyer's sole right shall be the exercise (if it
is entitled to do so) of its right of termination pursuant to Section 9.1(f)
hereof (and Buyer's sole remedies in connection therewith shall be those
expressly set forth in Section 9.2 hereof) and Seller shall not at any time
(whether before, on or after the Escrow Closing Date) have any further liability
whatsoever with respect to any such breach of Seller's representations and
warranties). If, and only if, all of the changes in Seller's representations and
warranties set forth in such Bringdown Certificate (other than any changes
related to Pending Transactions), taken in the aggregate, would have a Material
Adverse Effect, then Buyer shall have the right by written notice to Seller
actually received by Seller not later than the expiration of the Offer as
described in the Merger Agreement to terminate this Agreement pursuant to
Section 9.1(f) hereof. In the event that Seller shall deliver one or more new
Escrow Date Notification Certificates pursuant to the terms of Section 7.3
hereof setting forth a new Escrow Closing Date, Seller shall, on each such new
Escrow Closing Date, deliver to Buyer a new Bringdown Certificate certifying as
to the matters set forth above in this Section 5.9 as of such new Escrow Closing
Date.
5.10 Cooperation Regarding Taxes. After the Closing Date, Buyer and
Seller shall cooperate with each other and with each other's agents, including
accounting firms and legal counsel, in connection with matters relating to Taxes
of Buyer, Seller and their affiliates including (i) the preparation and filing
of any Tax Returns, (ii) determining the liability for and amount of any Taxes
due (including estimated Taxes) or the right to and amount of any refund of
Taxes, (iii) examinations of Tax Returns, and (iv) any administrative or
judicial proceeding in respect of Taxes assessed or proposed to be assessed.
Such information and documents shall be delivered without representation or
warranty and shall include, without limitation, records, returns, schedules,
documents, work papers or other relevant materials. Buyer and Seller shall also
make available to each other, as reasonably requested and on a mutually
convenient basis, personnel (including officers, directors, employees and agents
of Buyer or Seller or their respective affiliates) to provide such assistance as
might be reasonably required in connection of the matters set forth in (i),
(ii), (iii) and (iv) above. Any information provided under this Section 5.10
shall be kept confidential by the party receiving the information or documents,
except as may otherwise be necessary in connection with the filing of Tax
Returns or in connection with any communications with a tax authority or any
administrative or judicial proceedings relating to Taxes or any Tax Return.
Buyer and Seller and their respective affiliates shall make available to each
other for inspection and copying during normal business hours upon reasonable
notice all Tax records in their possession to the extent reasonably required by
the other party in connection with the preparation, review or audit of Tax
Returns, Tax litigation and claims, and the resolution of items under this
Agreement. All reasonable out-of-pocket costs and expenses incurred in
connection with any of the foregoing actions shall be for the account of the
party requesting such actions (subject to providing reasonable documentation of
such out-of-pocket costs and expenses). The provisions of this Section 5.10
shall survive Closing for a period of one year after the Closing Date.
5.11 Insurance. (a) For six years from the Closing Date, Echelon shall
maintain in effect Echelon's current directors' and officers' liability
insurance covering those Persons who are covered on the Agreement Date by
Echelon's directors' and officers' liability insurance policy (a copy of which
has been heretofore delivered to Buyer); provided that Seller may substitute for
such policies, policies with at least the same coverage containing terms and
conditions which are no less advantageous and provided that said substitution
does not result in any gaps or lapses in coverage with respect to matters
occurring prior to the Closing Date; provided, further, that in no event shall
Seller be required to expend pursuant to this Section 5.11(a) more than an
amount per year equal to 200% of the current annual premiums paid by Seller for
such insurance (it being understood and agreed that if the annual premiums
exceed such amount, Seller shall be required to obtain a policy with the
greatest coverage available for a cost not exceeding such amount). The
provisions of this Section 5.11(a) shall survive Closing for a period of six
years after the Closing Date.
(b) During the period commencing on the Agreement Date and ending on
the Closing Date, Seller will maintain the insurance policies relating to the
Real Estate Assets set forth on Schedule XXII; provided, that Seller may
discontinue or reduce any such insurance to the extent that (x) it is no longer
available at commercially reasonable rates or (y) similarly situated companies
are, in general, reducing or eliminating such insurance in a manner consistent
with the changes being effected by Seller, unless, in each case, Buyer shall
have requested in writing that Seller not discontinue or reduce, as the case may
be, such insurance and shall have paid to Seller in immediately available funds
all costs (including, without limitation, all premiums) and expenses of Seller
in connection with not discontinuing or reducing, as the case may be, such
insurance (it being expressly understood and agreed that in the event of
termination of this Agreement pursuant to Section 9.1 hereof, Buyer shall not be
entitled to any refund or reimbursement of any amounts previously paid by it to
Seller as contemplated above).
5.12 Reasonable Best Efforts. During the period commencing on the
Agreement Date and ending on the Closing Date, subject to the terms and
conditions provided herein, each of Buyer and Seller shall cooperate and use
their respective reasonable best efforts to take, or cause to be taken, all
appropriate action, and to make, or cause to be made, all filings necessary,
proper or advisable under applicable laws and regulations to consummate and make
effective the transactions contemplated by this Agreement, including, without
limitation, their respective reasonable best efforts to obtain, prior to the
Closing Date, all licenses, permits, approvals, authorizations, qualifications
and orders of governmental authorities and parties to Contracts with Seller as
are necessary for consummation of the transactions contemplated by this
Agreement.
5.13 Access to Information Concerning Assets. During the period
commencing on the Agreement Date and ending on the Closing Date, Seller shall,
upon reasonable notice, afford Buyer and its counsel, accountants, consultants
and other authorized representatives, reasonable access (subject to the rights
of tenants under the Leases and the leases relating to the Residential
Properties) during normal business hours to the employees, properties, books and
records of Seller in order that Buyer may have the opportunity to make such
investigations as it shall desire of the Assets. Seller shall furnish promptly
to Buyer (a) a copy of each report, schedule, registration statement and other
document filed by it during such period pursuant to the requirements of Federal
or state securities laws and (b) all other information in Seller's possession
concerning the Assets as Buyer may reasonably request. Seller agrees to cause
its officers and employees to furnish such additional financial and operating
data and other information and respond to such inquiries, in each case as Buyer
shall from time to time reasonably request in relation to the Assets.
5.14 Notification of Certain Matters. During the period commencing on
the Agreement Date and ending on the Closing Date, Seller shall give prompt
notice to Buyer, and Buyer shall give prompt notice to Seller, of the
occurrence, or failure to occur, of (x) any event, which occurrence or failure
to occur would likely cause any representation or warranty contained in this
Agreement to be untrue in any material respect and (y) the existence of any
Material Adverse Effect. During the period commencing on the Agreement Date and
ending on the Closing Date, each of Seller and Buyer shall give prompt notice to
the other party of any notice or other communication from any third party
alleging that the consent of such third party is or may be required in
connection with the transactions contemplated by this Agreement.
5.15 HSR Act. Buyer and Seller shall, as soon as practicable and in
any event within five Business Days following the Agreement Date, make any
required filings under the HSR Act and shall use their reasonable best efforts
to respond as promptly as practicable to all inquiries received with respect
thereto, including, without limitation, a request for additional information or
documentary material.
5.16 Access to Information Pursuant to Distribution Agreement. From
and after the Closing Date, Buyer shall afford to Seller and its authorized
accountants, counsel and other designated representatives reasonable access
during normal business hours to the personnel, properties, books and records
received by Buyer or its subsidiaries from Seller at time of Closing insofar as
same relates to the Total Assets and is reasonably required by Seller or Florida
Progress in connection with the satisfaction by either of them of their
respective obligations under the Distribution Agreement.
5.17 Witness Services Under Distribution Agreement. At all times from
and after the Closing Date, Buyer shall use its commercially reasonable efforts
to make available to Seller, upon reasonable written request, its and its
subsidiaries' officers, directors, employees and agents as witnesses to the
extent that such Persons may be required in connection with the prosecution or
defense of any actual or threatened action, suit, arbitration, inquiry,
proceeding or investigation by or before any court, any governmental or other
regulatory or administrative agency, body or commission or any arbitration
tribunal insofar as such action, suit, arbitration, inquiry, proceeding or
investigation relates to the Total Assets and is reasonably required by Seller
or Florida Progress in connection with the satisfaction by either of them of
their respective obligations under the Distribution Agreement. Buyer shall be
entitled to receive from Seller, upon the presentation of invoices therefor,
payments for such amounts, relating to disbursements and other out-of-pocket
expenses (which shall be deemed to exclude the costs of salaries and benefits of
employees who are witnesses), as may be reasonably incurred in providing such
witness services.
5.18 Retention of Records. Except as otherwise agreed between Buyer
and Seller in writing, Buyer shall, and shall cause its subsidiaries to, retain
all information relating directly and primarily to the Total Assets that is
delivered to or obtained by Buyer pursuant to the terms of this Agreement that
is less than ten years old until such information is at least ten years old
except that if, prior to the expiration of such period, information in the
possession or control of Buyer is to be destroyed or disposed of, and such
information is at least three years old, prior to destroying or disposing of any
such information, (1) Buyer shall provide no less than 30 days' prior written
notice to Seller specifying the information proposed to be destroyed or disposed
of and (2) if, prior to the scheduled date for such destruction or disposal,
Seller requests in writing that any of the information proposed to be destroyed
or disposed of be delivered to Seller, Buyer promptly shall deliver the
requested information to a location specified by Seller, at Seller's sole cost
and expense.
Section 6. Conditions Precedent to Closing.
6.1 Buyer Conditions. The obligation of Buyer to close the transaction
which is the subject of this Agreement is subject to the fulfillment as of the
Closing Date or as of the Escrow Closing Date, as applicable, of each of the
following conditions, unless any unfulfilled condition is waived in writing by
Buyer:
(a) Officer's Certificate. Echelon shall have delivered to Buyer a
certificate executed by the President, any Vice President or a managing member
of each of Echelon and its subsidiaries signatory hereto certifying that, as of
the Escrow Closing Date, Seller has performed in all material respects each of
its obligations and complied in all material respects with each agreement and
covenant of Seller to be performed or complied with by it under this Agreement
on or prior to such date, including the delivery of the certificate required
under Section 5.9 hereof.
(b) Delivery of Documents and Other Items. On or prior to the Escrow
Closing Date, all documents and other items specified in Section 7.4 hereof
shall have been delivered to Escrow Agent.
(c) Merger. The Merger shall have been consummated on or prior to the
Closing Date.
(d) Transfer of Other Assets. The transfer of the Other Assets to the
Other Buyer as contemplated by the Subscription Agreement in exchange for the
consideration provided therein shall have been consummated on or prior to the
Closing Date.
(e) Purchase and Sale of Tax Credit LP Interests. The purchase and
sale of the Tax Credit LP Interests as contemplated by the Tax Credit LP
Interest Purchase Agreement shall have been consummated on or prior to the
Closing Date.
(f) Leasing of the Other Assets. The leasing of the Other Assets as
contemplated by the Xxxxxx Lease shall have been consummated on or prior to the
Closing Date.
(g) Required Consents. All Required Consents shall have been executed
and delivered by the parties providing such Required Consents on or prior to the
Escrow Closing Date.
(h) HSR Act. Any applicable waiting period (and any extension thereof)
under the HSR Act applicable to the sale of Assets to Buyer shall have expired
or been terminated as of the Escrow Closing Date.
(i) No Injunction. No preliminary or permanent injunction or other
order shall have been issued by any court or by any governmental or regulatory
agency, body or authority which prohibits the consummation of the transactions
contemplated by this Agreement and which is in effect on the Closing Date;
provided, that, in the case of a decree, injunction or other order, each of the
parties shall have used reasonable best efforts to prevent the entry of any such
injunction or other order and to appeal as promptly as possible any decree,
injunction or other order that may be entered.
(j) Statutes. No law, statute, rule, regulation, executive order,
decree or order of any kind shall have been enacted, entered, promulgated or
enforced by any court or governmental authority which prohibits the consummation
of the transactions contemplated by this Agreement as of the Closing Date.
6.2 Seller Conditions. The obligation of Seller to close the
transaction which is the subject of this Agreement is subject to the fulfillment
as of the Closing Date or as of the Escrow Closing Date, as applicable, of each
of the following conditions, unless any unfulfilled condition is waived in
writing by Seller:
(a) Officer's Certificate. Buyer shall have delivered to Seller a
certificate of the President or any Vice President of Buyer certifying that, as
of the Escrow Closing Date, Buyer has performed in all material respects each of
its obligations and complied in all material respects with each agreement and
covenant of Buyer to be performed or complied with by it under this Agreement on
or prior to such date.
(b) Delivery of Documents and Other Items. On or prior to the Escrow
Closing Date, all documents and other items (including payment of the Purchase
Price) specified in Section 7.5 hereof shall have been delivered to Escrow
Agent.
(c) Merger. The Merger shall have been consummated on or prior to the
Closing Date.
(d) Transfer of Other Assets. The transfer of the Other Assets to the
Other Buyer as contemplated by the Subscription Agreement in exchange for the
consideration provided therein shall have been consummated on or prior to the
Closing Date.
(e) Purchase and Sale of Tax Credit LP Interests. The purchase and
sale of the Tax Credit LP Interests as contemplated by the Tax Credit LP
Interest Purchase Agreement shall have been consummated on or prior to the
Closing Date.
(f) Leasing of the Other Assets. The leasing of the Other Assets as
contemplated by the Xxxxxx Lease shall have been consummated on or prior to the
Closing Date.
(g) Required Consents. All Required Consents shall have been executed
and delivered by the parties providing such Required Consents on or prior to the
Escrow Closing Date.
(h) HSR Act. Any applicable waiting period (and any extension thereof)
under the HSR Act applicable to the sale of Assets to Buyer shall have expired
or been terminated as of the Escrow Closing Date.
(i) No Injunction. No preliminary or permanent injunction or other
order shall have been issued by any court or by any governmental or regulatory
agency, body or authority which prohibits the consummation of the transactions
contemplated by this Agreement and which is in effect on the Closing Date;
provided, that, in the case of a decree, injunction or other order, each of the
parties shall have used reasonable best efforts to prevent the entry of any such
injunction or other order and to appeal as promptly as possible any decree,
injunction or other order that may be entered.
(j) Statutes. No law, statute, rule, regulation, executive order,
decree or order of any kind shall have been enacted, entered, promulgated or
enforced by any court or governmental authority which prohibits the consummation
of the transactions contemplated by this Agreement as of the Closing Date.
Section 7. Closing.
7.1 Time and Place. The Closing will take place at the offices of
White & Case LLP, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000 on the
date of consummation of the Merger, or at such other place and time as shall be
agreed upon by the parties hereto (the actual date of the Closing being
hereinafter referred to as the "Closing Date").
7.2 Closing Expenses. All costs and expenses associated with the
purchase and sale of the Assets contemplated herein, including without
limitation, environmental and property condition reports (but only to the extent
procured prior to the Agreement Date with the approval of Seller), title
insurance premiums, survey preparation costs, transfer taxes (including all
stamp, transfer, documentary, sales, use, registration and other Taxes),
document recordation and filing charges, escrow expenses and other customary
costs of Closing, shall be paid by Seller. Each of Buyer and Seller shall be
responsible for its due diligence costs and expenses (including, without
limitation, the payment of the fees and disbursements of its attorneys) and
Seller shall make any required payments to the Broker in accordance with Section
8 hereof.
7.3 Notification of Escrow Closing Date. Seller shall deliver to Buyer
a certificate (an "Escrow Date Notification Certificate") specifying the Escrow
Closing Date (which in no event shall be earlier than the 30th day after the
Agreement Date) on which the Escrowed Items are to be delivered to Escrow Agent,
such Escrow Date Notification Certificate to be delivered by Seller to Buyer no
later than one day prior to such Escrow Closing Date; provided that if the
Tender Offer Expiration Date shall not have occurred on or prior to the third
Business Day after such Escrow Closing Date, Escrow Agent shall, upon written
request from Buyer, return the Escrowed Items to the party which had previously
deposited same with Escrow Agent, whereupon Seller shall have the right to
deliver a new Escrow Date Notification Certificate to Buyer upon the terms set
forth above specifying a new Escrow Closing Date. Seller shall have the right to
deliver one or more Escrow Date Notification Certificates upon the terms set
forth above until such time as the Tender Offer Expiration Date shall have
occurred or, if earlier, such time as this Agreement shall have been terminated
pursuant to Section 9.1 hereof.
7.4 Documents and/or Deliveries. On or prior to the Escrow Closing
Date, as a condition to Closing, the following shall be delivered to Escrow
Agent, which shall have been executed by Seller to the extent applicable (other
than those agreements, documents and instruments described in Sections
7.4(b)(vi), (b)(viii), (b)(ix), (c)(i), and (d)(i) hereof, all of which shall
have been made available to Buyer during normal business hours at one or more
locations previously identified to Buyer (which location shall, in the case of
the agreements, documents and instruments described in Sections 7.4(b)(vi),
(c)(i) and (d)(i) hereof, be 000 Xxxxxxxx Xxxxxxx, Xxxxx 000, Xx. Xxxxxxxxxx,
Xxxxxxx) and which shall remain in such locations until the Closing Date): (a)
with respect to Echelon and each Subsidiary: (i) good standing certificates and
authority to do business certificates issued by the relevant authorities in all
relevant jurisdictions, in each case, dated not more than thirty (30) days prior
to the Closing Date; (ii) certified corporate resolutions of Echelon and
corporate or limited liability company resolutions of each Subsidiary, or of the
general partner in each Subsidiary that is a limited partnership, as applicable,
authorizing the execution and delivery of this Agreement by Echelon or such
Subsidiary and the consummation of the transactions contemplated hereby; and
(iii) incumbency certificates for the officers of Echelon and each Subsidiary
executing the documents to be executed and delivered pursuant to this Agreement;
(b) with respect to the Real Estate Assets: (i) a special warranty
deed conveying title to the Real Estate Assets substantially in the form annexed
hereto as Exhibit A; (ii) a xxxx of sale with respect to the Real Estate Assets
substantially in the form annexed hereto as Exhibit B; (iii) an assignment and
assumption agreement with respect to Permits, Contracts and Leases being assumed
by Buyer in relation to the Real Estate Assets, substantially in the form
annexed hereto as Exhibit C; (iv) third-party consents sought in connection with
the consummation of the purchase and sale of the Real Estate Assets but only to
the extent actually obtained by Seller (it being expressly understood and
agreed, for avoidance of doubt, that so long as Seller shall have complied with
Section 5.7 hereof, no such third-party consents (other than the Required
Consents) shall be required to be obtained and in no event shall any such
third-party consents (other than the Required Consents) be a condition precedent
to the consummation of the transactions contemplated hereby); (v) tenant
estoppel statements, dated within one hundred and twenty (120) days of the
Closing Date, with respect to tenants occupying 50% of the rentable square
footage at the Commercial Property in the form specified in the tenant's Lease
or, if none, substantially in the form annexed hereto as Exhibit D (it being
understood that Seller does not warrant or guarantee any of the information
contained in tenant estoppel certificates); (vi) the originals (or copies, if
originals are unavailable) of existing Leases and all tenant files, Contracts
and files and records pertaining to any of the Real Estate Assets as are in
Seller's possession or in the possession of the current property manager for any
of the Real Estate Assets; provided, however, that Buyer will make all originals
available to Seller after Closing to the extent required by Seller in connection
with accounting, taxation, litigation or other proceedings involving Seller's
prior ownership of the any of the Real Estate Assets; (vii) notices to the
tenants renting space at the Real Estate Assets confirming that such Real Estate
Assets have been acquired by Buyer, in such form as Seller and Buyer shall
agree; (viii) originals (or copies, if originals are unavailable) of all
governmental licenses, permits and approvals relating to the occupancy or use of
any of the Real Estate Assets in the possession of Seller or Seller's current
property manager; (ix) those site plans, soil and substrata studies,
architectural renderings, plans and specifications, engineering plans and
studies, floor plans, landscape plans, utility schemes, tax bills and receipts
for current real estate taxes, keys and all other books, financial statements,
documentation, files or records covering, affecting or relating to the Real
Estate Assets in Seller's possession; (x) a Title Affidavit in the form annexed
hereto as Exhibit I; (xi) a Gap Indemnity in the form annexed hereto as Exhibit
J if required by the title insurance company; (xii) a FIRPTA Affidavit in the
form annexed hereto as Exhibit K; (xiii) such documents or other evidence as may
be required to satisfy all requirements raised in the Title Commitments;
provided, however, Seller shall not be required to satisfy requirements raised
in the Title Commitments relating to Real Estate Taxes, Existing Debt (other
than the delivery of the Required Consents relating to any Existing Debt in
accordance with the terms of this Agreement), Other Existing Debt, mechanics'
liens (other than the delivery of an affidavit certifying as to the status of
construction relating to any Real Estate Asset) or other matters which Buyer is
taking subject to pursuant to the terms of this Agreement; and (xiv) transfer
tax forms and affidavits as may be required by governmental authorities in
connection with the recordation of the special warranty deeds;
(c) with respect to the Joint Venture Interests: (i) originals (or
copies, if originals are unavailable) of all articles of incorporation, by-laws,
limited liability company agreements, limited liability company operating
agreements, partnership agreements, venture agreements and other organizational
documents relating to the joint ventures to which the Joint Venture Interests
relate and (ii) all documents and instruments required effectively to transfer
such Joint Venture Interests to Buyer, including, without limitation, consents
from co-venturers sought pursuant to the terms of the relevant joint venture
documentation, as more particularly identified on Schedule V (it being expressly
understood and agreed, for avoidance of doubt, that so long as Seller shall have
complied with Section 5.7 hereof, no such consents (other than the Required
Consents) shall be required to be obtained and in no event shall any such
consents (other than the Required Consents) be a condition precedent to the
consummation of the transactions contemplated hereby);
(d) with respect to the Existing Debt: (i) originals (or copies, if
originals are unavailable) of all documents and instruments evidencing and
securing the Existing Debt and (ii) all documents and instruments required to
effect the assignment and assumption of the borrower's interest in the Existing
Debt from Seller to Buyer, including without limitation, if applicable, consents
sought from the holders of the Existing Debt, as more particularly identified on
Schedule V (it being expressly understood and agreed, for avoidance of doubt,
that so long as Seller shall have complied with Section 5.7 hereof, no such
consents (other than the Required Consents) shall be required to be obtained and
in no event shall any such consents (other than the Required Consents) be a
condition precedent to the consummation of the transactions contemplated
hereby);
(e) with respect to the Employee Loans: (i) the promissory note
relating to each such Employee Loan, duly endorsed, or attaching an allonge
executed by Seller in favor of Buyer, in either case without recourse to Seller;
(ii) original, executed counterparts of all other documents and instruments
relating to such Employee Loan; and (iii) any consents sought from the obligors
of such Employee Loans, if applicable, as more particularly identified on
Schedule V (it being expressly understood and agreed, for avoidance of doubt,
that so long as Seller shall have complied with Section 5.7 hereof, no such
consents (other than the Required Consents) shall be required to be obtained and
in no event shall any such consents (other than the Required Consents) be a
condition precedent to the consummation of the transactions contemplated
hereby);
(f) with respect to the transfer of any Intellectual Property,
including trademarks, an assignment and assumption agreement substantially in
the form annexed hereto as Exhibit F;
(g) originals of all Required Consents (but only to the extent
theretofore obtained by Seller);
(h) a notice from the Chief Financial Officer of Echelon (which notice
shall be conclusive absent manifest error) setting forth the aggregate amount of
each of (i) the Excess Cash Amount, (ii) the Commercial Property Security
Deposit Amount, (iii) the Executive Loans Repayment Amount and (iv) the
Pre-Approved Expenditures; and
(i) with respect to the transfer of any of the Assets, such other
documents and instruments as are customary in connection with the transfer of
assets of the same type and which the parties deem reasonably necessary or
desirable to effect the consummation of the transactions contemplated hereby;
provided, however, that (i) Seller shall not be required to provide any
representations, warranties or indemnitees with respect to the Assets or title
thereto beyond those set forth in this Agreement, (ii) Seller shall not be
required to provide any representations or warranties which survive the Escrow
Closing Date and (iii) so long as Seller shall have complied with Section 5.7
hereof, no consents (other than the Required Consents) shall be required to be
obtained and in no event shall any such consents (other than the Required
Consents) be a condition precedent to the consummation of the transactions
contemplated hereby.
7.5 Buyer Documents and/or Deliveries. On or prior to the Escrow
Closing Date, Buyer will deliver (subject only to receipt by Buyer of the
relevant Bringdown Certificate and Escrow Date Notification Certificate) the
following to Escrow Agent, which shall have been executed by Buyer to the extent
applicable:
(a) the balance of the Purchase Price payable in accordance with
Section 2.2(b) hereof;
(b) certified copies of resolutions of Buyer authorizing the execution
and delivery of this Agreement and the consummation of the transactions
contemplated hereby;
(c) with respect to the transfer of any of the Assets, the documents
and instruments required to effect the assumption thereof, as more particularly
described in Sections 7.4(b)(iii), (c)(ii), (d)(ii) and (f) hereof;
(d) with respect to the transfer of any of the Assets and the
assumption of the Assumed Liabilities, such other documents and instruments as
are customary in connection with the transfer of assets and assumption of
liabilities of the same type and which the parties deem reasonably necessary or
desirable to effect the consummation of the transactions contemplated hereby;
provided, however, that (i) Seller shall not be required to provide any
representations, warranties or indemnitees with respect to the Assets or title
thereto beyond those set forth in this Agreement, (ii) Seller shall not be
required to provide any representations or warranties which survive the Escrow
Closing Date and (iii) so long as Seller shall have complied with Section 5.7
hereof, no consents (other than the Required Consents) shall be required to be
obtained and in no event shall any such consents (other than the Required
Consents) be a condition precedent to the consummation of the transactions
contemplated hereby; and
(e) transfer tax forms and affidavits as may be required by
governmental authorities in connection with the recordation of the special
warranty deeds.
7.6 Execution and Delivery of Closing Statements. At Closing, in
addition to any other documents required to be executed and delivered in
counterparts by both parties, Seller and Buyer will execute and deliver to each
other closing statements accounting for sums disbursed at Closing.
7.7 Joint Instructions to Escrow Agent. Not later than the Escrow
Closing Date, Buyer and Seller shall execute and deliver to Escrow Agent a joint
direction letter in the form annexed hereto as Exhibit L, which shall be
irrevocable, (a) listing with specificity all items delivered by Buyer and/or
Seller pursuant to Sections 7.4 and 7.5 hereof (including, without limitation,
(x) the balance of the Purchase Price and (y) the aggregate amount of Asset
Sales Proceeds) (all such items, together with the Deposit, collectively
referred to herein as the "Escrowed Items") and (b) setting forth irrevocable
instructions from Buyer and Seller to the effect that (x) immediately following
the filing by Escrow Agent of the Articles of Merger with respect to the Merger
with the Department of State of the State of Florida or the receipt of notice by
Escrow Agent that such filing has occurred, the Escrowed Items shall be promptly
delivered by Escrow Agent to the party entitled to same (including, without
limitation, that (A) the Purchase Price shall be delivered to the Surviving
Corporation (as defined in the Merger Agreement) or to such account as the
Surviving Corporation may designate and (B) the aggregate amount of Asset Sales
Proceeds shall be delivered to Buyer) as set forth in such joint direction
letter, (y) if this Agreement has been terminated pursuant to Section 9.1
hereof, the Escrowed Items shall be promptly delivered by Escrow Agent to the
party which had previously deposited same with Escrow Agent and (z) if Tender
Offer Expiration Date does not occur on or prior to the third Business Day after
the Escrow Closing Date, the Escrowed Items shall be promptly delivered by
Escrow Agent to the party which had previously deposited same with Escrow Agent.
7.8 Further Deliveries. Simultaneously with the delivery of the joint
instructions set forth in Section 7.7 of this Agreement, Buyer shall execute and
deliver (a) to Escrow Agent, together with Other Buyer, a joint instruction
letter in the form annexed hereto as Exhibit M and (b) to EIN Acquisition Corp.
a legal opinion addressed to Agent for the benefit of the Lenders (in each case
as such terms are defined in the Credit Agreement (as defined in the Merger
Agreement)) with respect to those matters contained in Sections 4.1, 4.2 and
4.3(a), (b) and (c) of this Agreement.
Section 8. Brokers. Each party represents and warrants to the other
that it has not consulted, dealt with or negotiated with any Person except
Seller has engaged Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation (the
"Broker") to whom a commission is or could be due in connection with the sale of
the Assets by Seller to Buyer, or any other matter associated with this
Agreement. Seller has made a separate agreement with Broker and will pay all
sums, if any, due to Broker in connection with this Agreement. Each party hereby
agrees to indemnify and hold harmless the other from any losses, damages, costs,
liabilities or expenses, including reasonable costs and attorneys' fees incurred
in trial, appellate or post-judgment proceedings, related to or arising out of
any breach of the representations, warranties and agreements set forth in this
Section 8 made by it. Anything to the contrary notwithstanding, the
representations, warranties and agreements in this Section 8 will survive
Closing of the transactions which are the subject of this Agreement, or any
earlier termination of this Agreement.
Section 9. Termination and Abandonment.
9.1 Termination. This Agreement may be terminated and the transactions
contemplated by this Agreement may be abandoned:
(a) by mutual consent of Buyer and Seller at any time prior to the
Tender Offer Expiration Date;
(b) by either Buyer or Seller at any time prior to the Closing Date,
if any court or governmental or regulatory agency shall have issued an order,
decree or ruling or taken any other action permanently enjoining, restraining or
otherwise prohibiting the consummation of any of the transactions contemplated
by this Agreement and such order, decree or ruling or other action shall have
become final and nonappealable;
(c) by either Buyer or Seller, if the Closing Date fails to occur
within 90 days following the Agreement Date, unless such failure of the Closing
Date to occur shall be as a result of a material breach of any representation,
warranty, obligation, covenant, agreement or condition set forth in this
Agreement on the part of the party seeking to terminate this Agreement;
(d) by either Buyer or Seller at any time prior to the Closing Date,
if the Merger Agreement shall have been terminated and be of no further force
and effect;
(e) by either Buyer or Seller at any time prior to the Tender Offer
Expiration Date, if any of the Subscription Agreement, the Xxxxxx Lease or the
Tax Credit LP Interest Purchase Agreement shall have been terminated and be of
no further force and effect;
(f) by Buyer on or at any time prior to the Escrow Closing, in the
event (i) that Buyer exercises its right of termination as provided in Section
5.9 or (ii) in the event of (A) a breach by Seller of its representations and
warranties set forth herein (other than arising out of or related to Pending
Transactions) which, taken in the aggregate, would have a Material Adverse
Effect or (B) a breach by Seller of its material covenants or agreements set
forth herein, in each case which (1) cannot or has not been cured prior to the
earlier of (x) 15 days after the giving of written notice of such breach to
Seller and (y) two Business Days prior to the Tender Offer Expiration Date and
(2) has not been waived by Buyer; or
(g) by Seller on or at any time prior to the Escrow Closing, in the
event of a breach by Buyer of any representation, warranty, covenant or
agreement contained in this Agreement, which (A) cannot or has not been cured
prior to the earlier of (i) 15 days after the giving of written notice of such
breach to Buyer, and (ii) two Business Days prior to the Tender Offer Expiration
Date and (B) has not been waived by Seller, except, in any case where such
failures are not reasonably likely to affect adversely the ability of Buyer to
consummate the transactions contemplated by this Agreement.
9.2 Effect of Termination. (a) In the event of the termination of this
Agreement pursuant to Section 9.1 hereof by Buyer or Seller, as the case may be,
written notice thereof shall forthwith be given to the other party specifying
the provision hereof pursuant to which such termination is made, and this
Agreement shall become void and have no effect and the parties will have no
further rights or obligations hereunder, except that Sections 7.2, 9.2, 12.7,
12.11 and 12.15 shall survive any termination of this Agreement.
(b) (i) In the event of a termination of this Agreement pursuant to
Section 9.1(a), (b), (c), (d), (e) or (f) above, the Deposit shall be returned
to Buyer.
(ii) In the event of a termination of this Agreement pursuant to
Section 9.1(d) above following the termination of the Merger Agreement pursuant
to Section 5.01(a) of the Merger Agreement (but only if Parent and Echelon shall
have entered into an alternative transaction within 180 days after such
termination of the Merger Agreement pursuant to which Parent (or an affiliate
thereof) would directly or indirectly acquire Echelon, the Excepted Leases or
all or substantially all of the assets or equity of Echelon and its
Subsidiaries) or Section 5.01(f), (g) or (k) of the Merger Agreement, Seller
shall pay to Buyer a sum of $3,500,000.
(iii) In the event of a termination of this Agreement pursuant to (x)
Section 9.1(d) above following the termination of the Merger Agreement pursuant
to Section 5.01(a) of the Merger Agreement (but only if Parent and Echelon shall
have entered into an alternative transaction within 180 days after such
termination of the Merger Agreement pursuant to which Parent (or an affiliate
thereof) would directly or indirectly acquire Echelon, the Excepted Leases or
all or substantially all of the assets or equity of Echelon and its
Subsidiaries) or Section 5.01(e), (f), (g), (j) or (k) of the Merger Agreement
or (y) Section 9.1(f) above, Buyer shall be entitled to receive from Seller
reimbursement for its reasonable out-of-pocket costs and expenses incurred in
connection with the transactions contemplated by this Agreement in the sum of up
to $1,000,000 (subject to providing reasonable documentation of such costs and
expenses); provided, that, notwithstanding the foregoing, in the event of the
termination of the Merger Agreement pursuant to Section 5.01(j) of the Merger
Agreement as a result of the termination of the Subscription Agreement by
Echelon pursuant to Section 9.1(g) thereof, Buyer shall not be entitled to
receive from Seller reimbursement for its out-of-pocket costs and expenses
incurred in connection with the transactions contemplated by this Agreement.
(iv) In the event of a termination of this Agreement pursuant to
Section 9.1(d) above following the termination of the Merger Agreement pursuant
to Section 5.01(h) or (i) of the Merger Agreement, Buyer shall be entitled to
receive 50% of any recovery of damages (as determined by a court of competent
jurisdiction in a final and non-appealable decision) or proceeds of any
settlement of a claim or any other amounts, in each case that Seller may
actually receive in connection with any proceeding by Seller against Parent for
damages arising out of the matters set forth in Section 5.01(h) or (i) of the
Merger Agreement; provided that, in no event (A) shall Buyer be entitled
pursuant to this Section 9.2(b)(iv) to receive from Seller an amount in excess
of $3,500,000 and (B) shall Seller be obligated to commence or pursue any
proceeding against Parent or any other Person for recovery of damages or other
amounts arising out of the matters set forth in Section 5.01(h) or (i) of the
Merger Agreement and in the event that Seller shall elect in its sole discretion
to commence and pursue any such proceeding against Parent or any other Person,
Buyer shall not be entitled to participate in any manner whatsoever in any such
proceeding nor shall Seller be obligated to cooperate, coordinate or consult
with Buyer in any manner whatsoever (including, without limitation, with respect
to any settlement or other compromise of any claims).
(v) In the event of a termination of this Agreement pursuant to
Section 9.1(f) above, Buyer may proceed against Seller for recovery of its
actual damages (as determined by a court of competent jurisdiction in a final
and non-appealable decision); provided that, in no event (A) shall any such
actual damages (i) exceed an amount equal to $3,500,000 or (ii) include any
out-of-pocket costs and expenses incurred by Buyer in connection with the
transactions contemplated by this Agreement and (B) shall Seller be liable for
loss of profits, or indirect, consequential or special damages arising out of,
or in connection with the transactions contemplated by, this Agreement.
(vi) In the event of a termination of this Agreement pursuant to
Section 9.1(g), Seller's sole remedy will be to receive a sum equal to the
Deposit as agreed and liquidated damages, it being agreed that in such event
Seller's actual damages would be incapable of precise ascertainment.
(vii) Except as expressly set forth above in this Section 9.2, neither
Buyer nor Seller shall be entitled to any remedy in connection with the
termination of this Agreement (including, without limitation, specific
performance).
(c) Any payment required to be made by Seller or Buyer, as the case
may be, pursuant to Section 9.2(b) shall be made by such party within three
Business Days after receipt by it of notice from the other party setting forth,
in reasonable detail, (i) a description of the event(s) giving rise to the
payment obligation and (ii) calculation of the payment obligation.
Section 10. Risk of Loss; Indemnity.
10.1 Casualty. In the event that any portion of the Real Estate Assets
is damaged or destroyed prior to the Tender Offer Expiration Date, and if such
damage or destruction would have, individually or in the aggregate, a Material
Adverse Effect (after giving effect to receipt of insurance proceeds), Buyer may
by written notice to Seller actually received by Seller not later than the
earlier to occur of (x) 12:01 a.m. (New York time) on the Tender Offer
Expiration Date and (y) the thirtieth day following Buyer's receipt of written
notice of such damage or destruction (such receipt of written notice by Seller
to be promptly thereafter acknowledged), terminate this Agreement, whereupon the
Deposit will be returned to Buyer and thereafter this Agreement will be null and
void and the parties will have no further rights or obligations hereunder.
Except as otherwise expressly provided in the immediately preceding sentence,
Buyer shall proceed to Closing with no reduction in the Purchase Price
notwithstanding any damage or destruction occurring with respect to the Real
Estate Assets, and Seller will deliver and/or assign to Buyer on the Closing
Date any insurance proceeds with respect to such damage or destruction to the
extent Seller is entitled to same; provided that Buyer shall be afforded
reasonable opportunity by Seller to participate in any discussions with third
parties relating to such insurance proceeds and such insurance proceeds shall
not be settled or otherwise compromised by Seller without the approval of Buyer
(not to be unreasonably withheld, conditioned or delayed). Seller shall notify
Buyer of any damage to or destruction of the Real Estate Assets promptly after
Seller learns of the same.
10.2 Condemnation. In the event that any portion of the Real Estate
Assets or access thereto is taken by eminent domain or condemnation proceeding
prior to the Tender Offer Expiration Date, and if such taking or condemnation
would have, individually or in the aggregate, a Material Adverse Effect (after
giving effect to receipt of award proceeds), Buyer may by written notice to
Seller actually received by Seller not later than the earlier to occur of (x)
12:01 a.m. (New York time) on the Tender Offer Expiration Date and (y) the
thirtieth day following Buyer's receipt of written notice of such damage or
destruction (such receipt of written notice by Seller to be promptly thereafter
acknowledged), terminate this Agreement, whereupon the Deposit will be returned
to Buyer and thereafter this Agreement will be null and void and the parties
will have no further rights or obligations hereunder. Except as otherwise
expressly provided in the immediately preceding sentence, Buyer shall proceed to
Closing with no reduction in the Purchase Price notwithstanding any taking or
condemnation occurring with respect to the Real Estate Assets, and Seller will
deliver and/or assign to Buyer on the Closing Date any award with respect to
such taking or condemnation to the extent Seller is entitled to same; provided
that Buyer shall be afforded reasonable opportunity by Seller to participate in
any discussions with third parties relating to such condemnation proceeds and
such condemnation proceeds shall not be settled or otherwise compromised by
Seller without the approval of Buyer (not to be unreasonably withheld,
conditioned or delayed). Seller shall notify Buyer of any eminent domain or
condemnation proceeding in respect of the Real Estate Assets promptly after
Seller learns of the same.
10.3 Indemnity. Subject to Section 11, each of Buyer and Seller (in
such capacity, "Indemnitor") agrees to indemnify and hold the other party (in
such capacity, "Indemnitee") harmless from and against any loss, cost,
liability, damage or expense including, without limitation, reasonable
attorneys' fees and costs in all trial and appellate proceedings ("Losses")
incurred in connection with any claim by a third party, including, without
limitation, any current or former shareholder, director, officer, employee or
agent of Seller (a "Claim"), made, or arising out of (x) in the case of Buyer
(as Indemnitor), the Assumed Liabilities or the Other Assumed Liabilities or any
failure by Buyer or Other Buyer, as the case may be, for any reason to pay,
perform and discharge any Assumed Liabilities or Other Assumed Liabilities, as
the case may be, or (y) in the case of Seller (as Indemnitor), the Excluded
Liabilities or any failure by Seller for any reason to pay, perform or discharge
any Excluded Liabilities.
Within not more than ten (10) days after the date upon which the
Indemnitee receives a complaint filed against it or a formal written demand of
it, the Indemnitee will deliver written notice (a "Claim Notice") to the
Indemnitor, describing in reasonable detail the facts giving rise to such Claim
and stating that the Indemnitee intends to seek indemnification for such Claim
from the Indemnitor pursuant to this Agreement. The Indemnitor will have the
right to settle all Claims upon terms and conditions acceptable to the
Indemnitor; provided that (i) such settlement includes an unconditional release
of the Indemnitee from all liability with respect to such Claim and (ii) such
settlement does not involve the imposition of equitable remedies or the
imposition of any material obligations on the Indemnitee other than financial
obligations for which the Indemnitee will be indemnified hereunder.
Upon timely receipt of a Claim Notice from the Indemnitee with respect
to any Claim, the Indemnitor may assume the defense thereof with counsel of the
Indemnitor's choice reasonably satisfactory to the Indemnitee, and will not be
required to engage more than one law firm to defend the Claim in question;
provided that such counsel is reasonably approved in writing by the Indemnitee,
and without regard to whether such counsel also represents Indemnitor in
defending such Claim. The Indemnitee will cooperate in all reasonable respects
in such defense. Subject to the foregoing duty of cooperation, the Indemnitee
will have the right to employ separate counsel in any action or Claim and to
participate in the defense thereof; provided that the fees and expenses of
counsel employed by the Indemnitee will be at the Indemnitee's sole cost and
expense, except as otherwise herein provided.
If the Indemnitor does not notify the Indemnitee in writing within ten
(10) days after receipt of a Claim Notice that the Indemnitor elects to
undertake the defense thereof, the Indemnitee will have the right, at the
expense of the Indemnitor, to defend the Claim with counsel of the Indemnitee's
choice.
The parties hereto acknowledge that the law firm defending a Claim may
have an inherent conflict of interest where the Indemnitor and Indemnitee have
not agreed upon the Indemnitee's right to indemnification. Therefore,
notwithstanding any provision herein to the contrary, unless an Indemnitor has
acknowledged in writing its obligation to indemnify the Indemnitee, the
Indemnitor will, and will cause the law firm defending the Claim to, at all
times keep the Indemnitee fully advised of the status of settlement negotiations
and/or defense of the Claim, and promptly provide to the Indemnitee copies of
all documents and correspondence related to the Claim. If, at any time, the
Indemnitee believes in good faith that the law firm defending the Claim is not
fairly representing the Indemnitee's position with respect to such Claim and/or
is prejudicing the Indemnitee's rights with respect to the Claim for
indemnification, the Indemnitee may, at the Indemnitor's sole expense, retain
separate counsel of the Indemnitee's choice, and such separate counsel will be
entitled fully to participate in the defense of such Claim on behalf of the
Indemnitee.
The Indemnitee will cooperate fully with the Indemnitor as to all
Claims, will make available to the Indemnitor as reasonably requested all
information, records and documents relating to all Claims and will preserve all
such information, records and documents until final, nonappealable resolution of
any Claim. The Indemnitee will also make available to the Indemnitor, as
reasonably requested, its personnel (including technical), agents and other
representatives who are responsible for preparing or maintaining information,
records or other documents, or who may have particular knowledge with respect to
any Claim. The Indemnitee will also cooperate with the Indemnitor in attempting
to minimize the Losses subject to indemnification by considering in good faith
any request to pursue, and/or assign to Indemnitor, any rights of contribution
or to reimbursement, whether contractual or otherwise.
Section 11. Employees and Employee Benefits Matters.
11.1 Transfer of Employees. Within a reasonable period of time prior
to the Closing Date, Buyer shall offer employment, commencing as of the Closing
Date, to all of the employees of Echelon and its subsidiaries as of the date
hereof (and still employed by Echelon and/or its subsidiaries on the date of
such offer of employment) on such terms and conditions as Buyer may determine;
provided, however, that with respect to any such employee currently on long-term
disability or other approved leave of absence, such offer shall be effective
upon such employee's resumption of active employment. Each such employee who
accepts such offer of employment is referred to hereinafter as a "Transferred
Employee", and all such employees collectively as the "Transferred Employees".
Notwithstanding the foregoing, following the Closing Date, Buyer may terminate
the employment of any Transferred Employee (subject to the payment by Buyer of
any severance benefits payable to such Transferred Employee in connection with
such termination under a plan substantially in accordance with the terms set
forth in Exhibit G annexed hereto).
11.2 Assumption of Liabilities. (a)(1) From and after the Closing
Date, Buyer shall assume, and shall honor, pay, perform and satisfy when due any
and all liabilities, obligations and responsibilities to, or in respect of, each
Transferred Employee, and each former employee and officer of Echelon and its
subsidiaries, arising under the terms of, or in connection with, any Employee
Benefit Plan, in each case, in accordance with the terms thereof in effect
immediately prior to the date hereof, with respect to events or claims arising
at any time; provided, that nothing contained herein shall constitute a
commitment or obligation on the part of Buyer to continue any such Employee
Benefit Plan after the Closing Date except that Buyer shall provide, or shall
cause to be provided, effective commencing on the Closing Date, coverage to all
current and former employees of Echelon and its subsidiaries (including any
employees who do not accept the offer of employment described in Section 11.1
hereof), and their spouses and dependents, under a group health plan which does
not contain any waiting period or exclusion or limitation with respect to any
pre-existing conditions, and Buyer shall be solely responsible for compliance
with the requirements of Section 4980B of the Code and part 6 of subtitle B of
Title I of ERISA ("COBRA"), including, without limitation, the provision of
continuation coverage, with respect to all such current and former employees,
spouses and dependents, for whom a qualifying event occurs before, on or after
the Closing Date. The terms "group health plan", "continuation coverage",
"qualifying event" and "qualified beneficiary" are used in this Section
11.2(a)(1) with the respective meanings ascribed thereto in COBRA.
(2) On the Closing Date, Buyer shall assume sponsorship of the Echelon
International Corporation Savings Plan (the "Savings Plan") and the related
trust, and the liabilities thereunder, with respect to all persons entitled to
benefits under the provisions of the Savings Plan, and Echelon shall cause all
right, title, interest, authorities, obligations, duties, liabilities and assets
of Echelon and its subsidiaries in, to and under the Savings Plan and the
related trust to be transferred to and assumed by Buyer and any successor
trustee, respectively, in accordance with applicable law. At Closing, the
parties shall execute and deliver such documents and instruments as may be
required to effect such assumption and transfer and to ensure that all assets of
the Savings Plan, as the same exist immediately prior to the Closing Date, shall
be transferred with the Savings Plan to the extent provided in this Section
11(a)(2). Effective upon Closing, Buyer will be substituted for Echelon as the
plan sponsor under the Savings Plan. For a period of at least twelve (12) months
following the Closing Date, Buyer covenants and agrees to maintain the Savings
Plan in accordance with the terms of the Savings Plan as in effect on the date
hereof, except to the extent that Buyer is required to amend the Savings Plan to
comply with applicable law.
(3) Buyer shall be solely responsible for and shall indemnify and hold
Echelon and its subsidiaries harmless from any obligations or Losses relating to
claims made by any of the Transferred Employees for their compensation,
severance or termination pay, benefits or notice under any applicable Federal,
state or local law or under any plan, policy, practice or agreement, in each
case, that accrues after the Closing Date and arises as a result of their
employment or separation from employment with Buyer or its subsidiaries after
the Closing Date.
(b) Subject to Section 11.2(a) hereof, Echelon shall be solely
responsible for and shall indemnify and hold Buyer harmless from any obligations
or Losses relating to claims made by any current or former employee of Echelon
and its subsidiaries, including, without limitation, the Transferred Employees,
for their compensation, severance or termination pay, benefits or notice under
any applicable Federal, state or local law or under any plan, policy, practice
or agreement, in each case, that accrue through the Closing Date as a result of
their employment or separation from employment with Echelon or its subsidiaries.
On or prior to the Closing Date, Echelon shall satisfy all obligations
(including payments due as a result of a change of control of Echelon or
otherwise) then due and payable under any employment agreement entered into by
Echelon or any of its subsidiaries (including the employment agreements
described on Schedule XIII) and shall deliver to Buyer copies of any and all
employee estoppel letters delivered in connection therewith.
(c) Accrued but unpaid vacation, sick or other paid time off with
respect to all employees of Echelon and its subsidiaries as of the Closing Date,
including, without limitation, the Transferred Employees, shall, to the extent
permitted by applicable law, be assumed by Buyer and paid by Buyer in accordance
with the terms of the applicable policies and procedures of Echelon and its
subsidiaries in effect on the date hereof.
(d) In the event of any "plant closing" or "mass layoff" by Buyer, as
defined by the Federal Worker Adjustment Retraining Notification Act, 29 U.S.C.
ss. 2101 et seq. ("WARN"), or any state law equivalent, which shall occur after
the Closing Date, Buyer shall comply with all of the requirements of WARN and
any applicable state law equivalent and shall indemnify Echelon and its
subsidiaries from and against any Losses incurred by Echelon and its
subsidiaries as the result of any action against Buyer or Echelon (and/or its
subsidiaries) under WARN.
11.3 Participation and Crediting of Service Under Employee Plans and
Practices. Following Closing, (a) Buyer shall waive any waiting periods,
exclusions, or pre-existing condition limitations that may otherwise be
applicable to Transferred Employees, and their spouses and eligible dependents,
under any benefit plans of Buyer, and (ii) Buyer shall honor or cause to be
honored all premiums, co-payments and deductibles paid by the Transferred
Employees, and their spouses and eligible dependents, during the plan year in
which Closing occurs under the employee welfare benefit plans and arrangements
of Echelon and its subsidiaries up to (and including) the Closing Date.
Following Closing, each employee benefit plan or arrangement and employee
compensation policy or practice sponsored by Buyer or its affiliates shall
credit, for all purposes (except for benefit accruals under any defined benefit
pension plans), all service of the Transferred Employees, and other employees
and officers of Echelon and its subsidiaries, with Echelon and its subsidiaries
(and their respective predecessors) to the same extent such service was taken
into consideration under comparable employee benefit plans of Echelon and its
subsidiaries.
Section 12. Miscellaneous.
12.1 Litigation. In the event of any litigation between Seller and
Buyer concerning the terms of this Agreement, the prevailing party will be
entitled to reimbursement of its costs and expenses, including reasonable
attorneys' fees incurred in trial, appellate and post-judgment proceedings. The
provisions of this Section 12.1 will survive Closing, expiration or termination
of this Agreement.
12.2 Escrow Obligations of Escrow Agent. Seller and Buyer acknowledge
that Escrow Agent undertakes hereunder to perform only such duties as are
expressly set forth herein and no implied duties or obligations will be inferred
against Escrow Agent. The Purchase Price (including the Deposit), the Asset
Sales Proceeds and the other Escrowed Items will be held and disbursed by Escrow
Agent as follows:
(a) Escrow Agent may (i) act in reliance upon any writing or
instrument or signature which it, in good faith, believes to be genuine, (ii)
assume the validity and accuracy of any statement or assertion contained in such
a writing or instrument and (iii) assume that any person purporting to give any
writing, notice, advice or instruction in connection with the provisions hereof
has been duly authorized to do so.
(b) Seller and Buyer agree, jointly and severally, to indemnify and
hold harmless Escrow Agent from and against any and all claims, liabilities,
losses, actions, suits or proceedings at law or in equity, or any other
expenses, fees or charges of any character or nature whatsoever, which Escrow
Agent may incur or with which it may be threatened solely by reason of its
acting as escrow agent hereunder, except to the extent resulting from Escrow
Agent's gross negligence, fraud or intentional misconduct; and in connection
therewith, to indemnify Escrow Agent against any and all expenses, including
reasonable attorneys' fees and the cost of defending any action, suit or
proceedings or resisting any claim; provided, however, that if such expenses are
incurred by Escrow Agent in connection with litigation between Seller and Buyer,
the responsibility for indemnifying Escrow Agent for such expenses will belong
solely to the non-prevailing party.
(c) Escrow Agent will not make any disbursement of the Purchase Price
(including the Deposit) or any Asset Sales Proceeds (except, in each case as set
forth in succeeding subsection (d)) without giving written notice to the party
which will not receive the disbursement at least ten (10) Business Days in
advance of the disbursement. The failure of the party not receiving the
disbursement to object (on or prior to the seventh day after receipt of such
notice) to the disbursement by written notice to the other party and to Escrow
Agent will constitute binding acquiescence of such party to the disbursement. If
there is any disagreement about the interpretation of this Agreement, or about
the rights and obligations, or the propriety, of any action contemplated by
Escrow Agent hereunder, or if Escrow Agent shall have received inconsistent
instructions as to the disbursement of the Purchase Price (including the
Deposit) or the Asset Sales Proceeds, in each case except as set forth in
succeeding subsection (d), Escrow Agent will not disburse the Purchase Price
(including the Deposit) or Asset Sales Proceeds, as the case may be, and will
file an action in interpleader to resolve such disagreement or inconsistency, as
the case may be. Escrow Agent will be indemnified (by Seller or Buyer, whichever
is the non-prevailing party) as set forth in the foregoing subsection (b) in
connection with such interpleader action, and will be fully protected in
suspending all or a part of its activities under this Agreement until a final
judgment in the interpleader action is received.
(d) Notwithstanding anything to the contrary set forth in foregoing
subsection (c) or elsewhere in this Agreement (including, without limitation,
receipt of inconsistent instructions from Buyer or Seller as to the disbursement
of any Escrowed Item), Escrow Agent shall take the following actions: (i) upon
receipt of all Escrowed Items specified in the joint direction letter described
in Section 7.7 hereof, Escrow Agent will promptly (and in any event, within one
Business Day) notify Buyer and Seller of such receipt of all Escrowed Items,
(ii) immediately following the filing by Escrow Agent of the Articles of Merger
with respect to the Merger with the Department of State of the State of Florida
or the receipt of notice by Escrow Agent that such filing has occurred, Escrow
Agent shall deliver the Escrowed Items to the party entitled to same (including,
without limitation, delivery of (x) the Purchase Price to Seller or to such
account as Seller may designate and (y) the Asset Sales Proceeds to Buyer) as
set forth in the joint direction letter described in Section 7.7 hereof, (iii)
immediately following receipt of written notice from Seller or Buyer that this
Agreement has been terminated pursuant to Section 9.1 hereof, the Escrowed Items
shall be promptly delivered by Escrow Agent to the party which had previously
deposited same with Escrow Agent and (iv) immediately following receipt of
written notice from Buyer that the Tender Offer Expiration Date did not occur on
or prior to the third Business Day after the Escrow Closing Date, the Escrowed
Items shall be promptly delivered by Escrow Agent to the party which had
previously deposited same with Escrow Agent.
(e) Escrow Agent may consult with counsel of its own choice and will
have full and complete authorization and protection for any action taken or
suffered by it hereunder in good faith and in accordance with the opinion of
such counsel. Escrow Agent otherwise will not be liable for any mistakes of fact
or error of judgment, or for any acts or omissions of any kind unless caused by
its willful misconduct or gross negligence.
(f) Escrow Agent may resign upon 15 days' written notice to Seller and
Buyer, and if a successor escrow agent is not appointed by Buyer and Seller
within such 15-day period, Escrow Agent may petition a court of competent
jurisdiction to name a successor.
12.3 Notices. All notices, requests, demands, claims, waivers and
other communications required or permitted to be given under this Agreement
shall be in writing and shall be deemed to have been duly given if delivered in
person or mailed, certified or registered mail with postage prepaid, or sent by
telecopier and courier service for next Business Day delivery, as follows:
(a) if to Seller, to it at:
Echelon International Corporation
000 Xxxxxxxx Xxxxxxx, Xxxxx 000
Xx. Xxxxxxxxxx, Xxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxx X. XxXxxxx
with a copy to:
Echelon International Corporation
000 Xxxxxxxx Xxxxxxx, Xxxxx 000
Xx. Xxxxxxxxxx, Xxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxx Xxxxxxxxx Xxxxxxx, Esq.
with a copy to:
White & Case LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxx X. Xxxxx, Xx., Esq.
and a copy to:
EIN Acquisition Corp.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxx Xxxxx
with a copy to:
Xxxxx Raysman Xxxxxxxxx Xxxxxx and Xxxxxxx LLP
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxx X. Xxxxx, Esq.
(b) if to Buyer, to it at:
c/o Equis Financial Group
Xxx Xxxxxxxxxx Xxxxx, 0xx Xxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxx X. Xxxxx
with a copy to:
Steel Xxxxxx & Xxxxx LLP
000 Xxxxx Xxxxxxxx Xxxxxxxxx
Xxxxx, Xxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxx X. Xxxxx, P.A.
(c) if to Escrow Agent, to it at:
LandAmerica Financial Group
0000 Xxxxxxx Xxxx Xxxxx, Xxxxx 000
Xxxxx, Xxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxxx
or to such other Person or address as any party shall specify by notice in
writing to each of the other parties. All such notices, requests, demands,
waivers and communications shall be deemed to have been received on the date of
delivery unless if mailed, in which case on the third Business Day after the
mailing thereof except for a notice of a change of address, which shall be
effective only upon receipt thereof.
12.4 Entire Agreement. This Agreement and the exhibits, schedules and
other documents referred to herein or delivered pursuant hereto, collectively
contain the entire understanding of the parties hereto with respect to the
subject matter contained herein and supersede all prior agreements and
understandings, oral and written, with respect thereto.
12.5 Successors and Assigns. This Agreement shall inure to the benefit
of and be binding upon the parties hereto, and their respective successors and
permitted assigns; and no third party shall have any rights, privileges or other
beneficial interests herein or hereunder. Buyer shall not be entitled to assign
this Agreement or any of its rights, duties or interests herein or hereunder to
any other Person; provided, however, that Buyer may, not less than five Business
Days prior to the Closing Date, designate one or more of its wholly-owned
subsidiaries or affiliates controlled by it to be the transferee of one or more
Assets and/or the Assumed Liabilities (without limiting the foregoing, it is
understood and agreed that Buyer may designate Echelon Commercial LLC, a
Delaware limited liability company and an affiliate of Buyer, to acquire title
to the 7th Avenue Property), in each case so long as (x) such transfer,
assignment or assumption does not impose any incremental burden on Seller under
this Agreement or delay (or otherwise impede) the consummation of the
transactions contemplated by this Agreement and (y) Buyer remains liable to
Seller for all of its obligations hereunder with respect to the Assumed
Liabilities and the Other Assumed Liabilities notwithstanding such transfer,
assignment or assumption.
12.6 Headings. The descriptive headings of the several Sections of
this Agreement are inserted for convenience only, do not constitute a part of
this Agreement and shall not affect in any way the meaning or interpretation of
this Agreement.
12.7 Applicable Law. This Agreement and the legal relations between
the parties hereto shall be governed by and construed in accordance with the
laws of the State of New York, without regard to the conflict of laws rules
thereof.
12.8 Severability. If any term, provision, covenant or restriction
contained in this Agreement is held by a court of competent jurisdiction or
other authority to be invalid, void, unenforceable or against its regulatory
policy, the remainder of the terms, provisions, covenants and restrictions
contained in this Agreement shall remain in full force and effect and shall in
no way be affected, impaired or invalidated.
12.9 Counterparts. This Agreement may be executed in several
counterparts, each of which shall be deemed to be an original, and all of which
together shall be deemed to be one and the same instrument.
12.10 No Waiver of Default. No waiver by a party of any breach of this
Agreement or of any warranty or representation hereunder by the other party will
be deemed to be a waiver of any other breach by such other party (whether
preceding or succeeding and whether or not of the same or similar nature), and
no acceptance of payment or performance by a party after any breach by the other
party will be deemed to be a waiver of any breach of this Agreement or of any
representation or warranty hereunder by such other party, whether or not the
first party knows of such breach at the time it accepts such payment or
performance. No failure or delay by a party to exercise any right it may have by
reason of the default of the other party will operate as a waiver of default or
modification of this Agreement or will prevent the exercise of any right by the
first party while the other party continues so to be in default.
12.11 Confidentiality. It is agreed that (x) Seller will, at all
times, keep in strict confidence all non-public information (other than
information made public as a result of a breach of its obligations pursuant to
this Section 12.11) obtained by it with respect to Buyer and/or the Assets and
(y) Buyer will, at all times prior to the Closing Date, keep in strict
confidence all non-public information (other than information made public as a
result of a breach of its obligations pursuant to this Section 12.11) obtained
by it with respect to Seller pursuant to or in connection with this Agreement or
any confidentiality agreement executed by Buyer related to the Assets (including
all information obtained by such Person with respect to the tenants and other
occupants of any of the Real Estate Assets and all information attached hereto
with respect to the Joint Venture Interests, the Employee Loans and the Existing
Debt). Each of Seller and Buyer agrees to instruct its agents, employees,
advisers and consultants to comply with the provisions of this Section 12.11 and
any confidentiality agreement executed in connection with the Assets.
Notwithstanding the foregoing, each of Seller and Buyer may disclose any such
non-public information obtained by it to its directors, bankers, advisors,
attorneys, accountants and agents so long as such parties agree in writing for
the benefit of the other parties hereto to keep the information confidential in
accordance with the terms of this Section 12.11. In addition, each of Seller and
Buyer may disclose any such non-public information as may be required by law. If
the purchase and sale of the Assets contemplated by this Agreement is not
completed for any reason, Buyer will, upon request of Seller, promptly return to
Seller all instruments and materials or copies of instruments and materials
delivered pursuant hereto and obtained by Buyer. The provisions of this Section
12.11 will survive any termination of this Agreement.
12.12 Recourse Limited. Notwithstanding anything to the contrary in
this Agreement, neither any present or future constituent shareholder, member,
partner, officer, director, employee or agent of the parties hereto or of any
corporation, limited liability company or partnership that is the owner of any
equity interest in the parties hereto will be personally liable, directly or
indirectly, under or in connection with this Agreement, or any document,
instrument or certificate securing or otherwise executed in connection with this
Agreement, or any amendments or modifications to any of the foregoing made at
any time or times, heretofore or hereafter, or in respect of any matter,
condition, injury or loss related to this Agreement or the Assets (provided that
Echelon shall be so liable to the extent Echelon constitutes the holder of
equity interests in its Subsidiaries); and each party hereto (and their
respective successors and assigns) waives any such personal liability.
12.13 Business Day. If any date herein set forth for the performance
of any obligations by Seller or for the delivery of any instrument or notice as
herein provided should be on a day other than a Business Day, the compliance
with such obligations or delivery will be deemed acceptable on the next
occurring Business Day.
12.14 Recordation. Buyer and Seller agree that neither this Agreement
nor any memorandum hereof will be recorded in any public records, and that any
such recording would constitute a default subject to Section 9.1 hereof.
12.15 Jury Waiver. IN ANY CIVIL ACTION, COUNTERCLAIM OR PROCEEDING,
WHETHER AT LAW OR IN EQUITY, WHICH ARISES OUT OF, CONCERNS, OR RELATES TO THIS
AGREEMENT, AND ANY AND ALL TRANSACTIONS CONTEMPLATED HEREUNDER, THE PERFORMANCE
HEREOF, OR THE RELATIONSHIP CREATED HEREBY, WHETHER SOUNDING IN CONTRACT, TORT,
STRICT LIABILITY OR OTHERWISE, TRIAL WILL BE TO A COURT OF COMPETENT
JURISDICTION AND NOT TO A JURY. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT
IT MAY HAVE TO A TRIAL BY JURY. ANY PARTY MAY FILE AN ORIGINAL COUNTERPART OR A
COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
PARTIES HERETO OF THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY. NEITHER PARTY HAS
MADE OR RELIED UPON ANY ORAL REPRESENTATIONS TO OR BY ANY OTHER PARTY REGARDING
THE ENFORCEABILITY OF THIS PROVISION. EACH PARTY HAS READ AND UNDERSTANDS THE
EFFECT OF THIS JURY WAIVER PROVISION.
12.16 Public Announcements. At all times prior to the Closing Date,
Seller, on the one hand, and Buyer, on the other hand, agree to consult promptly
with each other prior to issuing any press release or otherwise making any
public statement with respect to the transactions contemplated hereby (other
than for the Schedule TO, the Schedule 14D-9 and any other public filing made in
connection with the transactions contemplated by the Merger Agreement), and
shall not issue any such press release or make any such public statement prior
to such consultation and review by the other party of a copy of such release or
statement; provided, that (x) a party may, without the prior consent of any
other party, issue a press release or make such public statement as may be
required by law or any rule of or agreement with any national securities
exchange or automated quotation system to which such party is subject and (y)
subject to Seller's obligations under the Merger Agreement, Seller will give
Buyer and its counsel the opportunity to review and comment upon the Schedule
TO, the Schedule 14D-9 and any other public filing made in connection with the
transactions contemplated by the Merger Agreement but only to the extent that
same directly relates to the identity and description of Buyer or to the
description of the principal terms and conditions of this Agreement.
12.17 Radon Gas. Radon is a naturally occurring radioactive gas that,
when it has accumulated in a building in sufficient quantities, may present
health risks to persons who are exposed to it over time ("Radon"). Levels of
Radon that exceed federal and state guidelines have been found in buildings in
Florida. Additional information regarding Radon and Radon testing may be
obtained from the local county public health unit. The matters set forth in this
Section 12.17 shall constitute an exception to the representation and warranty
of Seller set forth in Section 3.7 hereof.
12.18 Bulk Sales Law Waiver. Each party hereto agrees to waive
compliance by the other with the provisions of the bulk sales law or comparable
law of any jurisdiction to the extent that the same may be applicable to the
transactions contemplated hereby.
12.19 Knowledge. When any representation or warranty contained in this
Agreement is expressly qualified by the knowledge of Seller or Echelon, such
knowledge means the actual knowledge of Xxxxxx X. XxXxxxx, W. Xxxxxxx Xxxxxxx,
Xxxxx X. Xxxxx, Xxxxx X. Xxxxxxx, Xxxxx X. Xxxxxxx, J. Xxxx Xxxxxx, Xxxxxx X.
Xxxxxx, Xxxxxxx X. Xxxxxxxx, Xxxxxxx X. Xxxxxxx or K. Xxxxx Xxxxxx.
12.20 Amendments, Modifications and Supplements. This Agreement
(including all Schedules and Exhibits thereto) may be amended, modified and
supplemented only in writing executed by the parties hereto.
12.21 Representations and Warranties. The respective representations
and warranties of Seller, on the one hand, and Buyer, on the other hand,
contained herein or in any certificates or other documents delivered pursuant
hereto shall not be deemed waived or otherwise affected by any investigation
made by any party. Except as expressly provided in Section 8 hereof (and, in the
case of Buyer, Sections 4.4, 4.5, 4.6 and 4.9 hereof), each and every such
representation and warranty shall expire with, and be terminated and
extinguished by, the Escrow Closing Date and thereafter neither Seller nor Buyer
shall be under any liability whatsoever with respect to any such representation
or warranty. Furthermore, notwithstanding anything to the contrary (express or
implied) set forth herein (other than Section 8 hereof), in the case of any
breach by Seller of any of its representations and warranties, Buyer's sole
right shall be the exercise (if it is entitled to do so) of its right of
termination pursuant to Section 9.1(f) hereof (and Buyer's sole remedies in
connection therewith shall be those expressly set forth in Section 9.2 hereof)
and Seller shall not at any time (whether before, on or after the Escrow Closing
Date) have any further liability whatsoever with respect to any such breach of
its representations and warranties. This Section 12.21 shall have no effect upon
any other obligation of the parties hereto, whether to be performed before or
after the Closing Date.
12.22 Performance and Discharge. The acceptance by Buyer of the
agreements, instruments and other documents contemplated in this Agreement
conveying title to, or assigning Seller's rights and interests in, the Assets
shall be deemed to be a full performance and discharge of every agreement and
obligation on the part of Seller to be performed under this Agreement, except
those, if any, where are herein specifically stated to survive delivery of such
agreements, instruments and other documents.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties have caused this Purchase and
Sale Agreement to be executed on the date(s) hereinafter set forth.
SELLER:
WITNESSED BY: ECHELON INTERNATIONAL CORPORATION,
a Florida corporation
By: /s/ Xxxxx X. Xxxxxxx
/s/ Xxxxxxxxx Xxxxxxxx Name: Xxxxx X. Xxxxxxx
Name: Xxxxxxxxx Xxxxxxxx Title: Senior Vice President & Chief
Financial Officer
/s/ Xxx Xxxxxxx Date: January 21, 2000
Name: Xxx Xxxxxxx
ECHELON DOWNTOWN I, INC., a Florida
corporation
By: s/s Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President
& Treasurer
Date: January 21, 2000
ECHELON RESIDENTIAL INVESTMENTS,
INC., a Florida corporation
By: s/s Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President
& Treasurer
Date: January 21, 2000
ECHELON RESIDENTIAL SERVICES, INC.,
a Florida corporation
By: s/s Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President
& Treasurer
Date: January 21, 2000
ECHELON GENERAL PARTNER, INC.,
a Florida corporation
By: s/s Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President
& Treasurer
Date: January 21, 2000
WITNESSED BY: ECHELON AT BRIARGATE, INC.,
a Florida corporation
s/s Xxxxxxxxx Xxxxxxxx By: s/s Xxxxx X. Xxxxx, Xx.
Name: Xxxxxxxxx Xxxxxxxx Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President
s/s Xxx Xxxxxxx & Treasurer
Name: Xxx Xxxxxxx Date: January 21, 2000
WITNESSED BY: ECHELON AT TWENTY MILE VILLAGE, INC.,
a Florida corporation
/ss Xxxxxxxxx Xxxxxxxx
Name: Xxxxxxxxx Xxxxxxxx By: s/s Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
/s/ Xxx Xxxxxxx Title: Senior Vice President
Name: Xxx Xxxxxxx & Treasurer
Date: January 21, 2000
WITNESSED BY: NEW FOURTH RESIDENTIAL LIMITED
PARTNERSHIP, a Texas Limited
/s/ Xxxxxxxxx Xxxxxxxx
Name: Xxxxxxxxx Xxxxxxxx By: Echelon General Partner, Inc.,
/s/ Xxx Xxxxxxx a Florida Corporation, its
Name: Xxx Xxxxxxx general partner
By: s/s Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President
& Treasurer
Date: January 21, 2000
XXXXXXX CREEK LIMITED PARTNERSHIP, a
WITNESSED BY: Texas Limited Partnership
/s/ Xxxxxxxxx Xxxxxxxx By:Echelon General Partner II, Inc.,
Name: Xxxxxxxxx Xxxxxxxx Inc., a Florida Corporation,
its general partner
/s/ Xxx Xxxxxxx
Name: Xxx Xxxxxxx By: s/s Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President
& Treasurer
Date: January 21, 2000
WITNESSED BY: RIVER PARK ESTATES, LLC, a Delaware
Limited Liability Company
/s/ Xxxxxxxxx Xxxxxxxx
Name: Xxxxxxxxx Xxxxxxxx By: Echelon Residential Incorporated,
a Florida Corporation, its
/s/ Xxx Xxxxxxx managing member
Name: Xxx Xxxxxxx
By: s/s Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President
& Treasurer
Date: January 21, 2000
WITNESSED BY: KELLER-COUNTRY BROOK LIMITED
PARTNERSHIP, a Texas Limited
/s/ Xxxxxxxxx Xxxxxxxx Partnership
Name: Xxxxxxxxx Xxxxxxxx
/s/ Xxx Xxxxxxx By: Echelon General Partner II,
Name: Xxx Xxxxxxx Inc., a Florida Corporation,
its general partner
By: s/s Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President
& Treasurer
Date: January 21, 2000
XXXXXXXX-XXXXX SF LIMITED
WITNESSED BY: PARTNERSHIP, a Texas Limited
Partnership
/s/ Xxxxxxxxx Xxxxxxxx
Name: Xxxxxxxxx Xxxxxxxx
By: Echelon General Partner II, Inc.,
/s/ Xxx Xxxxxxx a Florida Corporation, its
Name: Xxx Xxxxxxx general partner
By: /s/ Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President
& Treasurer
Date: January 21, 2000
WITNESSED BY: MID-TOWN RESIDENTIAL LIMITED
PARTNERSHIP, a Texas Limited
/s/ Xxxxxxxxx Xxxxxxxx Partnership
Name: Xxxxxxxxx Xxxxxxxx By: Echelon General Partner II, Inc.,
a Florida Corportion, its
/s/ Xxx Xxxxxxx general partner
Name: Xxx Xxxxxxx
By: /s/ Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President
& Treasurer
Date: January 21, 2000
WITNESSED BY: BUYER:
ECHELON RESIDENTIAL LLC, a
Delaware limited liability company
/s/ Xxxxx Xxxxxxx
Name: Xxxxx Xxxxxxx By: Equis Corporation, a
Massachusetts corporation,
/s/ J. Xxxxxx Xxxxxxx
Name: X.Xxxxxx Xxxxxxx By: /s/ Xxxxx X. Xxxxx
Name:Xxxxx X. Xxxxx
Title: Executive Vice President
Date: January 21, 2000
Escrow Agent hereby agrees to hold and disburse the Purchase
Price (including the Deposit), the Asset Sales Proceeds and the other Escrowed
Items in accordance with and subject to the provisions of the foregoing Purchase
and Sale Agreement.
LANDAMERICA FINANCIAL GROUP
By:/s/Xxxx X. Xxxxxx
Name: Xxxx X. Xxxxxx
Title: Counsel
Date: January 21, 2000
The following entities are executing this Agreement for the
purpose of acknowledging their agreement to convey any of the assets described
herein which they may have an ownership interest in:
ECHELON DEVELOPMENT CORPORATION
By: /s/Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President &
Treasurer
Date: January 21, 2000
ECHELON REAL ESTATE SERVICES, INC.
By:/s/Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President &
Treasurer
Date: January 21, 2000
PCC DEL, INC.
By:/s/Xxxxx X. Xxxxx, Xx.
Name:Xxxxx X. Xxxxx, Xx.
Title:President
Date: January 21, 2000
ECHELON RESIDENTIAL INCORPORATED
By: /s/Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title:Senior Vice President &
Treasurer
Date: January 21, 2000
ECHELON GENERAL PARTNER, INC.
By: /s/Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President &
Treasurer
Date: January 21, 2000
SOUTH CORE COMMERCIAL, INC.
By: /s/Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title:Senior Vice President &
Treasurer
Date: January 21, 2000
SOUTH CORE PARKING, INC.
By: /s/Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President &
Treasurer
Date: January 21, 2000
ECHELON AFFORDABLE DEVELOPMENT, INC.
By:/s/Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title:Senior Vice President &
Treasurer
Date: January 21, 2000
ECHELON CARILLON ONE, INC.
By:/s/Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President &
Treasurer
Date: January 21, 2000
ECHELON AT CARILLON TWO, INC.
By:/s/Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President &
Treasurer
Date: January 21, 2000
ECHELON CARILLON THREE, INC.
By:/s/Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title:Senior Vice President &
Treasurer
Date: January 21, 2000
ECHELON AT XXXXXXX, INC.
By:/s/Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President &
Treasurer
Date: January 21, 2000
HIGHPOINT CENTER HEALTH CLUB, INC.
By:/s/Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President &
Treasurer
Date:January 21, 2000
ECHELON GENERAL PARTNER AFFORDABLE
HOUSING, INC.
By:/s/Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President &
Treasurer
Date: January 21, 0000
XXXXXXX XX XXX XXXX XXX, INC.
By:/s/Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President &
Treasurer
Date:January 21, 2000
ECHELON AT NORTHLAKE, INC.
By:/s/Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President &
Treasurer
Date: January 21, 2000
ECHELON AT THE RESERVE I, INC.
By:/s/Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President &
Treasurer
Date: January 21, 2000
ECHELON AT THE RESERVE II, INC.
By:/s/Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title:Senior Vice President &
Treasurer
Date: January 21, 2000
ECHELON AT WOODLAND PARK, INC.
n/k/a ECHELON GATEWAY, INC.
By:/s/Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President &
Treasurer
Date: January 21, 2000
ECHELON AT THE HARBORAGE, INC.
By:/s/Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President &
Treasurer
Date: January 21, 2000
ECHELON RESIDENTIAL INVESTMENTS II,
INC.
By:/s/Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President &
Treasurer
Date: January 21, 0000
XXXX XXXXXX CAPITAL, INC.
By:/s/Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President &
Treasurer
Date: January 21, 2000
BAYBRIDGE APARTMENTS, LTD.
By:/s/Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President &
Treasurer
Date: January 21, 2000
200 CARILLON, L.L.C.
By:/s/Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President &
Treasurer
Date: January 21, 2000
SOUTH XXXXXXX RESIDENTIAL LIMITED
PARTNERSHIP
By:/s/Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title:Senior Vice President &
Treasurer
Date: January 21, 2000
RESIDENTIAL 98TH MEMORIAL CREEK
TURNPIKE LIMITED PARTNERSHIP
By:/s/Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title:Senior Vice President &
Treasurer
Date: January 21, 2000
MISSION RANCH LIMITED PARTNERSHIP
By:/s/Xxxxx X. Xxxxx, Xx.
Name: Xxxxx X. Xxxxx, Xx.
Title: Senior Vice President &
Treasurer
Date: January 21, 2000