Exhibit 2.1
SALE CONTRACT
THIS AGREEMENT OF PURCHASE AND SALE (this "Agreement") is made and
entered into this first day of May, 2002 (the "Contract Date"), by and between
West Coast Realty Investors, Inc., a Delaware corporation (the "Purchaser"), and
BSRT Northlake Limited Partnership, an Illinois limited partnership (the
"Seller").
1. SALE.
Seller agrees to sell and convey to Purchaser, and Purchaser agrees to
purchase from Seller, for the purchase price set forth below, and on the terms
and conditions set forth in this Agreement, the Project (as hereinafter
defined), including those certain buildings containing that number of net
rentable square feet specified on Exhibit A-1 attached hereto, which buildings
are leased by Seller to Tenants (hereinafter defined) for retail purposes
(collectively, the "Building"). The Building is commonly known by the street
addresses described on Exhibit A-1, and the Building is located in the State of
Georgia. For purposes of this Agreement: (a) the term, "Project" shall be deemed
to mean, on a collective basis: (a) a leasehold interest in the parcel(s) of
land described in Exhibit A, attached hereto (collectively, the "Land"),
pursuant to that certain ground lease more fully described on Exhibit A-3 (the
"Ground Lease") together with all rights, easements and interests appurtenant
thereto (b) the sub-lessor's interest in certain ground leases more fully
described on Exhibit A-2 (the "Outparcel Leases"); (c) all improvements located
on the Land, including, but not limited to, the Building, and all other
structures, systems, and utilities associated with, and utilized by Seller in
the ownership and operation of the Building (all such improvements being
referred to herein as the "Improvements"), but excluding improvements, if any,
owned by sublessees under the Outparcel Leases and by Tenants of the Building;
(d) all personal property and inventory owned by Seller, if any, located on or
in the Land or Improvements, or used in connection with the operation and
maintenance of the Project (the "Personal Property"), including, without
limitation, all personal property listed on Exhibit B, attached hereto; (e) all
trademarks, tradenames, development rights and entitlements and other intangible
property used or useful in connection with the foregoing excluding, however, the
names "Banyan" and "BSRT" and the symbol "BSRTS" (the "Intangible Personal
Property"); (f) Seller's interest in all leases and other agreements to occupy
all or any portion of the Project that are in effect on the Contract Date or
into which the Seller enters prior to Closing (as hereinafter defined), but
pursuant to the terms of this Agreement (which, together with the Ground Lease
and each of the Out Parcel Leases are herein referred to as the "Leases"); and
(g) to the extent assignable all governmental approvals, permits, licenses, and
other governmental rights relating to or useful in connection with the foregoing
(the "Governmental Approvals").
2. PURCHASE PRICE.
The total purchase price to be paid to Seller by Purchaser for the
Project shall be Twenty Million Five Hundred Thousand and no/100 Dollars
($20,500,000.00) [the "Purchase Price"]. The Purchase Price shall be paid to
Seller at Closing, plus or minus prorations and other adjustments hereunder, by
federal wire transfer of immediately available funds. Purchaser, in Purchaser's
sole discretion, may elect to assume (rather than have Seller discharge) the
existing first mortgage loan in favor of General Electric Capital Corporation
(who, together with any agent or loan servicer, is herein referred to as "GECC")
having a current principal balance of approximately $16.8 million (the "Existing
Indebtedness"). If Purchaser so elects, the principal balance of the Existing
Indebtedness, all accrued but unpaid interest thereunder, and any other amounts
owing thereunder, on the Closing Date will be credited against the Purchase
Price at the Closing.
3. CLOSING.
The purchase and sale contemplated herein shall be consummated at a
closing (the "Closing") to take place at the offices of Purchaser's counsel,
Xxxx Xxx Xxxxxxx & Xxxxxxxxx, LLP, 000 Xxxxxxxx Xxxxxxx, Xxxxx 000, Xxxxxxx,
Xxxxxxx 00000, on the basis of a "New-York style" closing with a representative
of the Title Company (as hereinafter defined) in attendance. Either or both of
Seller or Purchaser may elect not to attend the Closing, and if so, shall
deliver the money and documents required by it under this Agreement to the Title
Company on or before the Closing. The Closing shall occur thirty (30) days after
the Approval Date (as hereinafter defined), on or before the close of business,
or at such other time as the parties may agree upon in writing (the "Closing
Date"). The Closing shall be effective as of 12:01 A.M. on the Closing Date.
Notwithstanding the foregoing, the risk of loss of all or any portion of the
Project shall be borne by Seller up to and including the actual time of the
Closing and wire transfer of the Purchase Price to Seller, and thereafter by
Purchaser, subject to the terms and conditions of Paragraph 16 below.
4. XXXXXXX MONEY.
(a) Escrowee: On the Contract Date, the parties shall enter into an
escrow agreement in the form attached hereto as Exhibit C (the "Escrow
Agreement," the escrow created thereby being referred to herein as the
"Escrow"), designating Chicago Title Insurance Company as the escrowee
thereunder (the "Escrowee"). The parties hereby authorize their respective
attorneys to execute the Escrow Agreement and to make such amendments thereto as
they shall deem necessary or convenient to close the transaction contemplated
hereby.
(b) Initial Xxxxxxx Money Deposit. On the Contract Date, Purchaser
shall deposit into the Escrow, in accordance with the terms of the Escrow
Agreement, and as its xxxxxxx money deposit (the "Xxxxxxx Money"), the sum of
Two Hundred Thousand and No/100 Dollars ($200,000). The Xxxxxxx Money shall be
invested by the Escrowee in an interest-bearing account with an FDIC-insured,
national bank having gross assets in excess of $1,000,000,000.00 (an "Approved
Depository").
(c) Subsequent Xxxxxxx Money Deposit. On the Approval Date, Purchaser
shall deposit the additional sum of Two Hundred Thousand and no/100 Dollars
($200,000) into the Escrow and pursuant to the terms of the Escrow Agreement as
additional Xxxxxxx Money. From and after the deposit of the additional $200,000,
the aggregate sum of $400,000 shall be deemed to be the "Xxxxxxx Money"
hereunder and such Xxxxxxx Money shall be nonrefundable to the Purchaser except
in the event of a default by Seller or the failure of a condition precedent, or
as otherwise expressly provided for herein.
(d) Application at Closing. At Closing, the Xxxxxxx Money shall be
delivered to Seller and credited against the Purchase Price. All interest (if
any) earned on the Xxxxxxx Money shall be paid to Purchaser. All Xxxxxxx Money
shall be appropriately dealt with by the Escrowee so as to be delivered to the
Seller or Purchaser, as the case may be, as provided herein and as provided in
the Escrow Agreement.
5. SELLER'S FILE.
Seller shall provide reasonable access to Purchaser, in respect to all
documents and other materials listed as "Seller's File" on Exhibit D, attached
hereto. Such reasonable access shall expressly include the right of Purchaser to
make or have made at Purchaser's expense copies or duplicates of such documents
and other materials. Purchaser hereby acknowledges that Seller specifically
disclaims any representation or warranty as to the accuracy or completeness of
any and all portions of Seller's File.
6. INSPECTION PERIOD.
(a) Basic Project Inspection. During the "Inspection Period" (which
Inspection Period is defined to be the period from and after the Contract Date,
through 8:00 p.m., CDT on the date that is forty-five (45) days after the
Contract Date), Purchaser, its agents and representatives shall be entitled to
conduct a "Basic
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Project Inspection," (provided Purchaser shall not perform any invasive or
intrusive testing without the prior written consent of Seller, which consent
shall not be unreasonably withheld or delayed). The Basic Project Inspection
rights will include but are not limited to, the rights to: (i) enter upon the
Land and Improvements, on reasonable prior notice to Seller, to perform
inspections and tests of the Project, including, but not limited to, inspection,
evaluation and testing of the heating, ventilation and air-conditioning systems
and all components thereof (collectively, the "HVAC System"), all structural and
mechanical systems within the Improvements, including, but not limited to,
sprinkler systems, power lines and panels, air lines and compressors, automatic
doors, tanks, pumps, plumbing and all equipment, vehicles, and Personal
Property; (ii) examine and copy (at Purchaser's expense) any and all books,
records, correspondence, leases, and all other documents and matters, maintained
by Seller or its agents, relating to receipts and expenditures pertaining to the
Project for the two (2) most recent full calendar years and the current calendar
year (the "Records"); (iii) make investigations with regard to zoning,
environmental, building, code and other legal requirements; and (iv) make or
obtain market studies and real estate tax analyses. Purchaser acknowledges that
Seller has no right of access (and, therefore, can grant Purchaser no right of
access) to the radio tower that is located in the center of the Project. If
Purchaser, in its sole and absolute discretion, determines that the results of
any inspection, test or examination do not meet Purchaser's criteria for the
purchase, financing or operation of the Project in the manner contemplated by
Purchaser, or if the information disclosed does not otherwise meet Purchaser's
investment criteria or underwriting for any reason whatsoever, or if Purchaser,
in its sole discretion, otherwise determines that the Project is unsatisfactory
to it, Purchaser may terminate this Agreement by written notice to Seller (the
"Termination Notice"), with a copy to Escrowee, given not later than the last
day of the Inspection Period (the "Approval Date"). Upon such termination, the
Xxxxxxx Money, together with all interest thereon, shall be returned immediately
to Purchaser and neither party shall have any further liability to the other
hereunder, except as otherwise provided in this Agreement.
(b) Purchaser's Undertaking. Purchaser hereby covenants and agrees
that it shall cause all studies, investigations and inspections, performed at
the Project pursuant to this Paragraph 6, to be performed in a manner that does
not materially disturb or disrupt the tenancies or business operations of any of
the Project's Tenants (as hereinafter defined). In the event that, as a result
of Purchaser's exercise of its rights under Subparagraph 6(a), any damage occurs
to the Project, then Purchaser shall promptly repair such damage, at Purchaser's
sole cost and expense, so as to return the Project to substantially the same
condition as exists immediately prior to the occurrence of such damage.
Purchaser hereby indemnifies, protects, defends and holds Seller harmless from
and against any and all losses, damages, claims, causes of action, judgments,
costs and expenses (including, without limitation, reasonable attorneys' fees
and expenses), incurred or sustained by reason of the claim of any person or
entity made by reason of Purchaser's activities as permitted pursuant to this
Paragraph 6. Purchaser represents and warrants to Seller that Purchaser has
adequate insurance coverage for the foregoing risk. Purchaser acknowledges that
Seller has not granted to Purchaser the Seller's permission to contact any
Tenant of the Project or the ground lessor during the Inspection Period and
Purchaser hereby covenants to refrain from such contact during the Inspection
Period. The covenants of Purchaser contained in this Paragraph 6 shall survive
the termination of this Agreement.
(c) Confidentiality. Each party agrees to maintain in confidence, and
not to disclose to third parties, the information contained in this Agreement or
pertaining to the sale contemplated hereby and the information and data
furnished or made available by Seller to Purchaser, its agents and
representatives in connection with Purchaser's investigation of the Project and
the transactions contemplated by the Agreement; provided, however, that each
party, its agents and representatives may disclose such information and data (a)
to such party's accountants, attorneys, prospective lenders, investment bankers,
underwriters, ratings agencies, partners, shareholders, consultants and other
advisors in connection with the transactions contemplated by this Agreement
(collectively "Representatives") to the extent that such Representatives
reasonably need to know such information and data in order to assist, and
perform services on behalf of Purchaser or Seller; (b) to the extent required by
any applicable statute, law, regulation or governmental authority provided,
where practical, reasonable notice of such intended disclosure is given to the
other party; (c) in connection with any litigation that may arise between the
parties in connection with the transactions contemplated by this Agreement and
(d) as is otherwise reasonably necessary in the conduct of Purchaser's
investigations pursuant to this Paragraph 6 or other provision of this
Agreement.
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7. TITLE AND SURVEY MATTERS.
(a) Conveyance of Title. At Closing, Seller agrees to deliver to
Purchaser an assignment of the Ground Lease (the "Ground Lease Assignment") in
recordable form, conveying a leasehold interest in the Project to Purchaser,
free and clear of all liens, claims and encumbrances except for the following
items (the "Permitted Exceptions"): (1) those matters listed on Exhibit E
attached hereto; (2) those additional matters that may be specifically approved,
in writing, by Purchaser during the Inspection Period; and (3) the rights of
Tenants as tenants only under the Leases; and (4) the Existing Indebtedness, if
assumed by Purchaser.
(b) Title Commitment. Within five (5) days after the Contract Date,
Purchaser shall order a title commitment, dated after the Contract Date, issued
by Chicago Title Insurance Company (the "Title Company"), for an owner's title
insurance policy (the "Title Policy"), ALTA Policy Form, in the full amount of
the Purchase Price, showing a leasehold interest in the Project in Seller,
subject only to the Permitted Exceptions, together with legible and complete
copies of all recorded documents evidencing title exceptions raised in Schedule
B of the title commitment. A copy of the commitment and the Schedule B documents
shall be promptly provided to Seller. As a condition precedent to Purchaser's
obligation to close the transaction described in this Agreement, the title
commitment shall be later-dated to cover the Closing and the recording of the
Ground Lease Assignment, and the Title Company shall deliver the Title Policy to
the Purchaser concurrently with the Closing. The cost of the title insurance
premiums, including all search fees, shall be paid by Purchaser. The cost of the
endorsements to the Title Policy requested by Purchaser shall be paid by
Purchaser.
(c) Survey. Within thirty (30) days after the Contract Date, Seller
shall obtain, at Seller's sole cost and expense, an as-built, survey of the
Project meeting ALTA requirements, prepared by ALTA Surveying, Inc. (the
"Survey"), dated as of a date on or after the Contract Date, prepared by a
surveyor duly registered in the State of Georgia, and certified by said
surveyor.
(d) UCC Searches. Purchaser may, at Purchaser's sole cost and
expense, order, within fourteen (14) days after the Contract Date, current
searches of such Uniform Commercial Code financing statements as Purchaser may
desire with respect to Seller and/or the Project itself. If such searches are
timely ordered and the results of any of such searches reveal claims or liens
against any of such parties encumbering all or any portion of the Project, then
the cure provisions set forth in Subparagraph 7(e) below shall apply.
(e) Defects and Cure. The items described in this Paragraph 7 are
collectively referred to as "Title Evidence." If the Title Evidence discloses
claims, liens, exceptions, encumbrances, encroachments, or other matters of
survey, or conditions of which Purchaser does not approve (the "Defects"),
Purchaser shall notify Seller in writing during the Inspection Period of any
Defects. Purchaser's failure to so notify Seller shall result in Purchaser's
acceptance of title as disclosed in the Title Evidence. Seller shall cure any
objections Purchaser may have to title to the Project; however, Seller shall
have no obligation to expend in excess of $5,000 to cure the title objections,
except for deeds to secure debt and other liens of an ascertainable amount which
Seller shall cause to be released at Closing. Seller shall be required to
discharge the lien of the Existing Indebtedness only in the event that Purchaser
elects to close the transaction without assuming the Existing Indebtedness.
Seller agrees to remove any exceptions or encumbrances to title which are
created by, through or under Seller after the date of this Agreement. If Seller
does not cure those Defects which it is obligated to cure, or if Seller does not
cause all such Defects to be insured over by the Title Company subject to the
reasonable approval of Purchaser (consent to which shall not be unreasonably
withheld or delayed), then Purchaser, as its sole remedy, may terminate this
Agreement by written notice to the Seller given within ten (10) days after
expiration of the Inspection Period, in which event the Xxxxxxx Money, together
with all interest earned thereon, shall be returned to Purchaser and neither
party shall have any further liability to the other hereunder, except as
otherwise provided in this Agreement. Purchaser shall have the right to object
to any Defects first arising after the effective date of Purchaser's title
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examination of the Property. Seller shall take no affirmative action which
results in a further encumbrance of the Property after the Contract Date.
8. SELLER'S REPRESENTATIONS AND WARRANTIES.
Seller represents and warrants to Purchaser that the following matters
are true as of the Contract Date and shall be true in all material respects as
of the Closing Date:
(a) Title. The Seller owns a leasehold interest in the Project and,
other than with respect to the Permitted Exceptions, has or will at Closing
have, a good, marketable and insurable leasehold interest in the Project, free
and clear of all encumbrances, other than the Permitted Exceptions.
(b) Contracts. There are no contracts of any kind relating to the
management, leasing, operation, maintenance or repair of the Project, except
those "Contracts" listed on Exhibit H, all of which will be terminated by Seller
prior to Closing unless Purchaser otherwise directs Seller pursuant to written
notice provided to Seller at least forty (40) days prior to Closing. Seller has
performed all material obligations required to be performed by it, and has not
received any uncured notices of default, under any of such Contracts.
(c) Employees. There are no employees of Seller at the Project.
(d) Compliance with Laws and Codes. Seller has received no written
notice and has no actual knowledge of any violations (collectively, "Violations"
and individually, a "Violation") of any applicable local, state or federal laws,
municipal ordinances or regulations, orders, rules or requirements of any
federal, state or municipal department or agency having jurisdiction over or
affecting the Project or the construction, management, ownership, maintenance,
operation, use, improvement, acquisition or sale thereof, including without
limitation, building, health and environmental laws, regulations and ordinances,
any equal access opportunity laws, regulations and ordinances (collectively,
"Legal Requirements") whether or not officially noted or issued.
(e) Litigation. Except as described on Schedule 8(e), there are no
actions, suits, proceedings, claims, orders, decrees or judgments affecting
Seller, its business, prospects or conditions (financial or otherwise), or the
Project or any portion thereof, or relating or arising out of the ownership or
operation of the Project or any portion thereof which are pending in any court
or by or before any federal, state, county or municipal department, commission,
board, bureau or agency or governmental instrumentality. Seller is not now a
party to any litigation affecting the Project and to Seller's best knowledge, no
litigation has been threatened. There is no litigation pending nor to the best
of Seller's knowledge threatened which would affect the Project or the Purchaser
after Closing.
(f) Re-Zoning. There is not now pending, and Seller has received no
written notice of and has no actual knowledge of, any threatened proceeding for
the rezoning of the Project or any portion thereof, or the taking of any other
action by governmental authorities that would have a material adverse impact on
the value of the Project or use thereof.
(g) Authority. Subject to Paragraph 26, the execution and delivery of
this Agreement by Seller, and the performance of this Agreement by Seller, have
been duly authorized by Seller, and this Agreement is binding on Seller and
enforceable against Seller in accordance with its terms. Except for the consent
of GECC, if Purchaser elects to assume the Existing Indebtedness, no consent of
any creditor, investor, judicial or administrative body, Governmental Authority,
or other governmental body or agency, or other party to such execution, delivery
and performance by Seller is required. Neither the execution of this Agreement
nor the consummation of the transactions contemplated hereby will (i) result in
a breach of, default under, or acceleration of, any agreement to which Seller is
a party or by which Seller or the Project are bound; or (ii) violate any
restriction, court order, agreement or other legal obligation to which Seller
and/or the Project is subject.
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(h) United States Person. Seller is a "United States Person" within
the meaning of Section 1445(f)(3) of the Internal Revenue Code of 1986, as
amended, and shall execute and deliver an "Entity Transferor" certification at
Closing.
(i) Condemnation. Seller has received no written notice and has no
actual knowledge of any pending or contemplated condemnation or other
governmental taking proceedings affecting all or any part of the Project.
(j) Rent Roll/Delinquency Report. Attached hereto as Exhibit I is a
rent roll and delinquency report (the "Rent Roll") pertaining to
the Project. To the best of Seller's knowledge, the Rent Roll is
a true and accurate listing, as of the date it bears, of (i) the
Leases; (ii) the Tenants; (iii) the term of the Leases; (iv) the
square footage leased to each Tenant; (v) the Base Rent and
Rental adjustments; (vi) abatements; (if any) in respect to the
Leases; (vii) reimbursements; (viii) leasing costs, (ix) rent
delinquencies and (x) security deposits.
(k) Georgia Resident. Seller is or is deemed to be a resident of
Georgia for purposes of O.C.G.A.Section 48-7-128 and shall
execute and deliver at Closing an affidavit of residency
sufficient to enable Purchaser not to withhold a portion of the
sales proceeds pursuant to O.C.G.A.Section 48-7-128.
(l) Ground Lease. Neither Seller, or, to the best of Seller's
knowledge, the lessor under the Ground Lease, is in default in
any of the terms, conditions or covenants of the Ground Lease,
nor to the best of Seller's knowledge, is there any condition or
circumstance which, to the best of Seller's knowledge, would with
the passage of time, giving of notice, or both, become a default
under the Ground Lease. To the best of Seller's knowledge, the
Ground Lease is in full force and effect and, to the best of
Seller's knowledge, Seller has not waived or excused any of the
duties or obligations of the lessor under the Ground Lease.
The representations and warranties made in this Agreement by Seller shall be
continuing, and shall be deemed remade by Seller as of the date of Closing with
the same force and effect as if in fact specifically remade at that time.
Notwithstanding anything to the contrary provided herein, Purchaser shall have
no right to pursue any action against Seller pursuant to this Paragraph 8 as a
result of any of Seller's representations and warranties being untrue,
inaccurate or incorrect if Purchaser has actual knowledge at the time of Closing
that such representation or warranty was untrue, inaccurate or incorrect at the
time of Closing and Purchaser, nevertheless closes the transfer of the leasehold
interest hereunder. The representations and warranties of Seller contained in
this Paragraph 8 will not survive the Closing.
8.5 PURCHASER'S REPRESENTATIONS AND WARRANTIES.
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Purchaser represents and warrants to Seller that the following matters
are true as of the Contract Date and shall be true in all material respects as
of the Closing Date:
(a) Litigation. Except as described on Schedule 8.5(a), there are no
actions, suits, proceedings, claims, orders, decrees or judgments affecting
Purchaser which are pending in any court or by or before any federal, state,
county or municipal department, commission, board, bureau or agency or
governmental instrumentality and which would affect the Project or Seller after
Closing. There is no litigation pending, nor to the best of Purchaser's
knowledge threatened, which would affect the Purchaser, the Project or the
Seller after the Closing.
(b) Authority. The execution and delivery of this Agreement by
Purchaser, and the performance of this Agreement by Purchaser, have been duly
authorized by Purchaser, and this Agreement is binding on Purchaser and
enforceable against Purchaser in accordance with its terms. No consent of any
creditor, investor, judicial or administrative body, Governmental Authority, or
other governmental body or agency, or other party to such execution, delivery
and performance by Purchaser is required. Neither the execution of this
Agreement nor the consummation of the transactions contemplated hereby will (i)
result in a breach of, default under, or acceleration of, any agreement to which
Purchaser is a party or by which Purchaser is bound; or (ii) violate any
restriction, court order, agreement or other legal obligation to which Purchaser
is subject.
The representations and warranties made in this Agreement by Purchaser shall be
continuing, and shall be deemed remade by Purchaser as of the date of Closing
with the same force and effect as if in fact specifically remade at that time.
Notwithstanding anything to the contrary provided herein, Seller shall have no
right to pursue any action against Purchaser pursuant to this Paragraph 8.5 as a
result of any of Purchaser's representations and warranties being untrue,
inaccurate or incorrect if Seller has actual knowledge at the time of Closing
that such representation or warranty was untrue, inaccurate or incorrect at the
time of Closing, and Seller nevertheless closes the transfer of the leasehold
interest hereunder. The representations and warranties of Purchaser contained in
this Paragraph 8.5 will not survive the Closing.
9. COVENANTS OF SELLER.
Effective as of the execution of this Agreement, Seller hereby covenants
with Purchaser as follows:
(a) New Leases. Following the Approval Date, Seller shall neither
amend any Lease in any material respect nor execute any new lease, license, or
other agreement affecting the ownership or operation of the Project or for
personal property, equipment, or vehicles, without Purchaser's prior written
approval, which approval shall not be unreasonably withheld or delayed. Should
Purchaser consent, in its reasonable discretion, to any such new lease (such
lease being referred to herein as a "New Lease"), license or other agreement
affecting the ownership or operation of the Project or for personal property
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or vehicles, and in the event such lease, license or other agreement calls for
the Project owner to pay for commissions, tenant improvements or other
inducements, and provided this transaction is consummated, then at Closing, said
amounts shall be prorated between Purchaser and Seller based upon the number of
days that the benefits under such lease, license or other agreement inured to
the benefit of Seller prior to Closing and to Purchaser after Closing.
(b) New Contracts. Following the Approval Date, Seller shall not
enter into any contract with respect to the ownership and operation of the
Project that will survive the Closing, or that would otherwise affect the use,
operation or enjoyment of the Project, without Purchaser's prior written
consent, which consent shall not be unreasonably withheld or delayed, except for
service contracts entered into in the ordinary course of business which are
terminable without penalty on not more than thirty (30) days' notice. Should
Purchaser consent, in its reasonable discretion, to any such new agreement
affecting the ownership or operation of the Project or for personal property or
vehicles, and such new agreement calls for the Project owner to pay monies or
other inducements, and provided this transactions is consummated, then at
Closing, said amounts shall be prorated between Purchaser and Seller based upon
the number of days the benefits under such new agreement inured to the benefit
of Seller prior to Closing and to Purchaser after Closing.
(c) Notification of Purchaser. During the Inspection Period, Seller shall
furnish to Purchaser, within two (2) business days of execution, true
and correct copies of all new or amended leases, licenses, contracts or
other agreements affecting the use, ownership, operation, or enjoyment
of the Project, and Seller shall refrain from executing any such
agreement for the final five (5) business days of the Inspection Period.
(d) Insurance. The insurance policies maintained by Seller which insure the
Property against casualty loss shall remain continuously in force
through and including the Closing Date, and shall be terminated by
Seller immediately thereafter.
(e) Operation of Project. Seller shall operate and manage the Project
consistent with past practices, maintaining present services, and shall maintain
the Project in its present condition, normal wear and tear and loss due to fire
or other casualty excepted (as provided in Paragraph 16 hereof); shall keep on
hand sufficient materials, supplies, equipment and other personal property for
the efficient operation and management of the Project consistent with past
practices; and shall perform, when due, Seller's obligations under the Leases,
Contracts, Governmental Approvals and other agreements relating to the Project
and otherwise in accordance with applicable laws, ordinances, rules and
regulations affecting the Project. Except as otherwise specifically provided
herein, Seller shall deliver the Project at Closing in substantially the same
condition as it is on the Contract Date, reasonable wear and tear excepted and
loss due to fire or other casualty excepted (as provided in Paragraph 16
hereof), and shall terminate, as of the Closing Date, the Contracts, unless
otherwise advised to the contrary by Purchaser, in writing, as contemplated by
Subparagraph 8(b) hereof. None of the Personal Property, fixtures or
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Inventory shall be removed from the Project, unless replaced by personal
property, fixtures or inventory of equal or greater utility and value. Seller
shall not terminate, modify or waive any defaults or obligation under the Ground
Lease.
(f) Pre-Closing Expenses. Seller has paid or will pay in full, prior
to Closing, all bills and invoices for labor, goods, material and services of
any kind relating to the Project and utility charges, relating to the period
prior to Closing incurred by Seller. Except for obligations under New Leases,
any alterations, installations, decorations and other work required to be
performed under any and all agreements affecting the Project have been or will,
by the Closing, be completed and paid for in full.
The covenants of Seller contained in this Paragraph 9 will not survive the
Closing.
10. WARRANTIES AND AGREEMENTS.
a. Definitions.
Unless the context otherwise requires:
(1) "Environmental Law" or "Environmental Laws" shall mean:
(i) the Comprehensive Environmental Response, Compensation, and
Liability Act (42 U.S.C. Sections 9601 et seq.), as amended
("CERCLA"); (ii) the Solid Waste Disposal Act, as amended by the
Resource Conservation and Recovery Act (42 U.S.C. Sections 6901
et seq.), as amended; (iii) the Emergency Planning and Community
Right to Know Act (42 U.S.C.Sections 11001 et seq.), as amended;
(iv) the Clean Air Act (42 U.S.C. Sections 7401 et seq.), as
amended; (v) the Clean Water Act (33 U.S.C. I 1251 et seq.), as
amended; (vi) the Toxic Substances Control Act (15 U.S.C. I 2601
et seq.), as amended; (vii) the Hazardous Materials
Transportation Act (49 U.S.C. Sections 1801 et seq.), as amended;
(viii) the Federal Insecticide, Fungicide and Rodenticide Act (7
U.S.C. I 136 et seq.), as amended; (ix) the Safe Drinking Water
Act (41 U.S.C. I 300f et seq.), as amended; (x) any state,
county, municipal or local statutes, laws or ordinances similar
or analogous to the federal statutes listed in parts (i) - (ix)
of this subparagraph (a); (xi) any amendments to the statutes,
laws or ordinances listed in parts (i) - (x) of this subparagraph
(a), regardless of whether in existence on the date hereof; (xii)
any rules, regulations, guidelines, directives, orders or the
like adopted pursuant to or implementing the statutes, laws,
ordinances and amendments listed in parts (i) - (xi) of this
subparagraph (a); and (xiii) any other law, statute, ordinance,
amendment, rule, regulation, guideline, directive, order or the
like in effect now or in the future relating to environmental,
health or safety matters.
(2) "Governmental Authorities" shall mean any commission,
department or body of any municipal, township, county, state or
Federal governmental
9
unit, having jurisdiction over the Project or the management,
operation, use or improvement thereof.
(3) "Hazardous Conditions" refers to the presence on, in or
about the Project (including ground water) of Hazardous
Materials, the concentration, condition, quantity, location or
other characteristic of that fails to comply with the most
stringent standards now or hereafter applicable or relevant or
appropriate, under applicable environmental Laws.
(4) "Hazardous Material" shall mean any chemical, substance,
waste, material, equipment or fixture defined as or deemed
hazardous, toxic, a pollutant, a contaminant, or otherwise
regulated under any Environmental law, including, but not limited
to, petroleum and petroleum products, waste oil, halogenated and
non-halogenated solvents, PCBs, and asbestos. The term "Hazardous
Material" does not include usual and customary cleaning and other
supplies in amounts necessary for the normal operation,
maintenance and/or occupancy of the Project or used in any of
Tenants' businesses.
(5) "Release" shall have the meaning found in 42 U.S.C.
Section 9601(22) and shall include migration.
(6) "Remedial Action" shall mean any and all corrective
action, preventative measures, response, removal, transport,
disposal, clean-up, abatement, treatment and monitoring of
Hazardous Materials or Hazardous Conditions, including the
Contamination (defined below), whether voluntary or mandatory,
and all studies, assessments or investigations performed to
determine if such actions are necessary or appropriate, all
occurring on or after the Contract Date.
(7) "Remedial Costs" shall include all costs, expenses and
fees incurred on or after the date of this Agreement in
connection with Remedial Action, including but not limited to the
fees of environmental consultants and contractors, reasonable
attorneys' fees (including compensation for in-house and
corporate counsel provided such compensation does not exceed
customary rates for comparable services), laboratory analysis,
regulatory, permitting and review fees, costs of soil and/or
water treatment and/or transport and disposal and the cost of
supplies, equipment, material and utilities used in connection
with Remedial Action.
(b) Warranties. To the best of Seller's knowledge, during the period
of Seller's ownership of the Project and except as disclosed in the
Environmental Reports:
(1) The Project has been and continues to be owned and
operated in substantial compliance with all Environmental Laws.
10
(2) There have been no past and there are no pending or
threatened (i) written claims, complaints, notices, or requests
for information received by Seller with respect to any alleged
violation of any Environmental Law with respect to the Project,
or (2) written claims, complaints, notices, or requests for
information to Seller regarding potential or alleged liability
under any Environmental Law with respect to the Project.
(3) There have been no Releases of Hazardous Materials at, on,
under or about the Project.
(4) Seller has made available to Purchaser and Purchaser's
counsel copies of all reports, studies, analyses, and tests in
the possession or control of, or initiated by or authorized by,
the Seller pertaining to any environmental matters or concerns,
including but not limited to hazardous conditions and Hazardous
Materials related to or affecting the Project ("Environmental
Reports").
(5) There are no events, conditions, circumstances,
activities, practices, uses, or incidents that may give rise to
any material, common or legal liability or otherwise form the
basis of any material claim, suit, action, demand, proceeding,
hearing or notice of violation, study or investigation relating
to the environment or arising under any Environmental Laws, which
would relate to or affect the Project, or any person or entity as
a result of such person or entity holding title to, possessing,
occupying or operating the Project, or any portion thereof during
Seller's ownership thereof.
(c) Survival of Warranties.
The warranties made in Subparagraph 10(b) of this Agreement by Seller
shall be continuing, and shall be deemed remade by Seller as of the date of
Closing with the same force and effect as if in fact specifically remade at that
time. Notwithstanding anything to the contrary provided herein, Purchaser shall
have no right to pursue any action against Seller pursuant to Subparagraph 10(b)
as a result of any of Seller's warranties being untrue, inaccurate or incorrect
if Purchaser has actual knowledge at the time of Closing that such warranty was
untrue, inaccurate or incorrect at the time of Closing and Purchaser,
nevertheless closes the transfer of leasehold interest hereunder. The warranties
of Seller contained in this Subparagraph 10(b) will not survive the Closing.
11. ADDITIONAL CONDITION PRECEDENT TO CLOSING/PURCHASER'S COVENANT IN
RESPECT THERETO.
In addition to the other conditions enumerated in this Agreement, each
of the following shall be an additional Condition Precedent (as hereinafter
defined) to Purchaser's obligation to close hereunder:
11
a. Assumption Condition. Provided that Purchaser (i) elects to
assume the Existing Indebtedness; (ii) makes formal written application for such
assumption by the fourteenth (14th) day after the Contract Date (iii) submits
all required materials, including financial information and completed
questionnaires, and (iv) diligently pursues such application process, the
obligation of Purchaser to close the transaction described herein is expressly
conditioned upon Purchaser obtaining, within forty (40) days of the Contract
Date, the express written consent of GECC (or its loan servicer) to the
assumption of the Existing Indebtedness. Any and all costs, charges and fees
(including GECC's attorney's fees) associated with the assumption of the
Existing Indebtedness shall be paid by Purchaser. In the event this condition
shall not be fulfilled on the 41st day after the Contract Date and provided that
prior to the end of the second business day following the 41st day after the
Contract Date, Purchaser gives written notice to Seller that the condition has
not been fulfilled, the Contract shall become null and void and all Xxxxxxx
Money, together with all interest earned thereon, shall be returned to the
Purchaser, and except as otherwise provided in this Agreement, neither party
shall have any further liability to the other hereunder.
b. Purchaser's Covenants Regarding Assumption. If Purchaser elects
to attempt to assume the Existing Financing as provided in
Paragraph 11a, then Purchaser represents and warrants to Seller
that Purchaser has a reasonable good faith belief that the
assumption of the Existing Indebtedness as described in paragraph
11a. is available to Purchaser and that Purchaser qualifies
therefore. In that connection, Purchaser covenants with Seller
that Purchaser will use commercially reasonable efforts to obtain
such assumption, including submitting an application (in writing)
with all supporting materials not later than the fourteenth
(14th) day after the Contract Date and diligently pursuing such
application once it has been filed. Purchaser agrees to provide
to Seller a copy of its application, as filed, within three (3)
business days of the filing, together with the name of a contact
party at GECC from whom Seller can obtain periodic status updates
on the progress of Purchaser's application. Purchaser will
provide Seller with copies by facsimile, within one business day
of receipt by Purchaser, of all correspondence received by
Purchaser in connection with its assumption application.
Purchaser's loan application requires a hearing or presentation
before any commission or other public body, Purchaser shall give
written notice to Seller of the date and time of such hearing or
presentation, as soon as practical after the scheduling, such
that Seller may attend.
c. Estoppel Certificate from Ground Lessor. As a Condition Precedent
to Purchaser's obligation to close hereunder, Seller shall obtain
and deliver to Purchaser, on or prior to the Closing Date, an
estoppel certificate (the "Ground Lease Estoppel Certificate"),
dated no earlier
12
than thirty (30) days prior to the originally scheduled Closing
Date, from the lessor under the Ground Lease. Such Ground Lease
Estoppel Certificate shall be substantially in the form of
Exhibit K attached hereto. Seller shall use diligent efforts to
obtain the Ground Lease Estoppel Certificate. If Seller (despite
its diligent efforts) is unable to obtain the Ground Lease
Estoppel Certificate, Purchaser may elect to waive compliance
with this requirement or Purchaser's sole remedy shall be to
terminate this Agreement because of non-satisfaction of a
Condition Precedent, in which event the Xxxxxxx Money, with
interest thereon, will be immediately returned to Purchaser and,
except as otherwise provided in this Agreement, neither party
shall have any further liability to the other hereunder.
12. LEASES-CONDITIONS PRECEDENT AND WARRANTIES WITH RESPECT THERETO.
a. Warranties as to Leases. With respect to each of the tenants (the
"Tenants") listed on the Rent Roll (attached as Exhibit I) provided to Purchaser
by Seller, Seller represents and warrants to Purchaser, to the best of Seller's
knowledge, as follows, the ongoing truth of the following being a Condition
Precedent to Purchaser's obligation to close:
(1) Each of the Leases is in full force and effect according
to the terms set forth therein and in the Rent Roll, and has not
been modified, amended, or altered, in writing or otherwise. No
Lease has been assigned, pledged, hypothecated, mortgaged or
otherwise transferred in whole or in part, except as collateral
for a loan to be discharged at Closing. No consent of any person
or entity is required for the valid and effective assignment to
Purchaser of Seller's interest under the Leases. The Leases are
not subject to any lien other that the Permitted Exceptions.
(2) Except as set forth on Schedule 12(a)(2) regarding CAM
reconciliations, Lessor has received no notice and has no actual
knowledge of any assertion that Lessor is in default under any of
the Leases.
(3) No Tenant is in default under or is in arrears in the
payment of any sums or in the performance of any obligations
required of it under its Lease except as disclosed in the Rent
Roll or in the delinquency report attached thereto. Seller has
received no notice of and has no actual knowledge of any actual
or threatened claims, defenses or rights of set-off by any Tenant
against Seller or Seller against any Tenant thereunder. No Tenant
has prepaid any rent or other charge more than thirty (30) days
in advance of its due date.
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(4) Except as set forth on Schedule 12(a)(4) regarding AMC and
Michael's, Seller has not received any written notice from any
Tenant that such Tenant is unable or unwilling to perform any or
all of its obligations under its Lease, whether for financial or
legal reasons or otherwise.
(5) Except as described in Schedule 12(a)(5) attached hereto,
there are no brokers' commissions, finders' fees, or other
charges payable or to become payable to any third party on behalf
of Seller as a result of or in connection with any Lease or any
transaction related thereto, including, but not limited to, any
exercised or unexercised option(s) to expand or renew.
(6) Except as to the New Leases, there are no concessions,
abatements, or free rent periods granted or due or alleged to be
granted or due to any Tenant nor any commission due or claimed or
alleged to be due any person or entity as or in the nature of any
broker's or agent's fees or commissions in respect to any Lease
or any options or the exercise of any options in respect to any
Lease, whether by contract, agreement or otherwise.
(7) Each security deposit provided for under each Lease shall
be fully assigned to Purchaser at the Closing. No Tenant
has asserted in writing any claim (other than for
customary refund at the expiration of a Lease) to all or
any part of any security deposit.
(8) Except as described on Schedule 12(a)(8), Seller is not
aware of any conflicts between Tenants under the Leases
regarding parking field accessibility rights.
The warranties made in this Subparagraph 12(a) of this Agreement by Seller shall
be continuing, and shall be deemed remade by Seller as of the date of Closing
with the same force and effect as if in fact specifically remade at that time.
Notwithstanding anything to the contrary provided herein, Purchaser shall have
no right to pursue any action against Seller pursuant to this Subparagraph 12(a)
as a result of any of Seller's warranties being untrue, inaccurate or incorrect
if Purchaser has actual knowledge at the time of Closing that such warranty was
untrue, inaccurate or incorrect at the time of Closing and Purchaser,
nevertheless closes the transfer of the leasehold interest hereunder. The
warranties of Seller contained in this Subparagraph 12(a) will not survive the
Closing.
b. Estoppel Certificates from Tenants. As a Condition Precedent to
Purchaser's obligation to close hereunder, Seller shall have obtained and
delivered to the Purchaser, on or prior to the Closing Date, an estoppel
certificate (the "Estoppel Certificate"), each dated no earlier than thirty (30)
days prior to the Closing Date from:: (a) each of the Tenants under the
Outparcel Leases; (b) each Tenant whose premises exceed 10,000 square feet; (c)
75% (measured by square footage leased) of the Tenants whose premises are
between 1,000 and 10,000 square feet; and (d) 50% (measured by square footage
leased) of the Tenants whose premises are less than 1,000 square feet, provided,
however
14
that if GECC requires a greater number of estoppel certificates from Tenants in
connection with the assumption of the Existing Indebtedness, then the
requirements of GECC shall control. Each such Estoppel Certificate shall be
substantially in the form attached hereto as Exhibit O. Seller covenants to use
reasonable diligent efforts to obtain Estoppel Certificates from all Tenants. If
Seller (despite its diligent efforts) is unable to obtain an Estoppel
Certificate from the required number of Tenants, Purchaser may elect to waive
compliance with this requirement or Purchaser's sole remedy shall be to
terminate this Agreement because of non-satisfaction of a Condition Precedent,
in which event the Xxxxxxx Money, with interest thereon, will be immediately
returned to Purchaser and, except as otherwise provided in this Agreement,
neither party shall have any further liability to the other hereunder.
13. DELIVERIES.
At Closing (or such other times as may be specified below), Seller shall
deliver or cause to be delivered to Purchaser the following, in form and
substance reasonably acceptable to Purchaser:
a. Ground Lease Assignment and Estoppel Certificate. The Ground
Lease Assignment, executed by Seller, in recordable form (reciting actual
consideration if required by law or local custom) conveying a leasehold interest
in the Project to Purchaser free and clear of all liens, claims and encumbrances
except for the Permitted Exceptions. Seller shall also deliver to Purchaser an
original of the Ground Lease Estoppel Certificate.
b. Xxxx of Sale. A Xxxx of Sale, executed by Seller, assigning,
conveying and warranting to the Purchaser title to the Personal Property and
Inventory, free and clear of all encumbrances, other than the Permitted
Exceptions, and assignments of title to all vehicles, if any, included in the
Personal Property, together with any original certificates of title thereto.
c. Assignment of Contracts. An assignment, executed by Seller, to
Purchaser of those of the Contracts that Purchaser may elect in writing to
assume (the "Assigned Contracts"), with (i) the agreement of Seller to
indemnify, protect, defend and hold Purchaser harmless from and against any and
all claims, damages, losses, suits, proceedings, costs and expenses (including,
but not limited to, reasonable attorneys' fees) arising in connection with the
Assigned Contracts and relating to the period of time prior to Closing and (ii)
the corresponding agreement of Purchaser to indemnify Seller for claims arising
in connection with the Assigned Contracts and relating to the period of time
after the Closing. Seller shall also assign (to the extent assignable)all
guarantees and warranties given to Seller in connection with the operation,
construction, improvement, alteration or repair of the Project.
d. Assignment of Leases/Estoppel Certificates. An assignment of the
Leases (including all security deposits and/or other deposits thereunder), with
the reciprocal
15
indemnity provisions described in clause (c) above, together with the Estoppel
Certificates of the requisite number of Tenants in conformity with Paragraph
12(b) hereof.
e. Keys. Keys to all locks located in the Project.
f. Affidavit of Title and ALTA Statement. An Affidavit of Title and
an ALTA Statement, each executed by Seller and in form and substance acceptable
to the Title Company and reasonably acceptable to Purchaser.
g. Letters to Tenants. Letters executed by Seller and, if
applicable, its management agent, addressed to all Tenants, in form approved by
Purchaser, notifying all Tenants of the transfer of ownership and directing
payment of all rents accruing after the Closing Date to be made to Purchaser or
at its direction.
h. Original Documents. To the extent not previously delivered to
Purchaser, and to the extent available, originals of the Leases, Assigned
Contracts, Certificates of Title, Intangible Personal Property and Governmental
Approvals.
i. Closing Statement. A closing statement conforming to the
proration and other relevant provisions of this Agreement.
j. Broker's Lien Waiver. Such lien waivers from brokers as required
by the Title Company.
k. Updated Rent Roll. An updated Rent Roll dated within five (5)
business days of closing with a current delinquency report attached as an
exhibit, certified by Seller, to the best of its knowledge, as true and accurate
in all material respects.
l. FIRPTA Affidavit. An affidavit executed by Seller stating that
Seller is not a foreign person or entity and is thus not subject to withholding.
m. 1099 Form. A Form-1099 disclosing Seller's federal employer
identification number.
n. Affidavit of Residency. An affidavit of residency executed by
Seller stating that Seller is a Georgia resident and in form sufficient to
enable Purchaser not to withhold a portion of the sales proceeds pursuant to
O.C.G.A. Section 48-7-128.
o. Assignment of Intangible Personal Property and Governmental
Approvals. An assignment executed by Seller, to Purchaser of the Intangible
Personal Property and the Governmental Approvals (to the extent assignable).
p. Authority Documents. Evidence of the existence of Seller and the
authority of Seller and the persons executing on behalf of Seller to execute the
Ground Lease Assignment and other closing documents, including, but
16
not limited to, evidence of the approval of Seller's Board of Trustees pursuant
to Paragraph 26 of this Agreement.
q. Schedule of Delinquent Rents. The Schedule of Delinquent Rents
required by Paragraph 14g.
r. Other. Such other documents and instruments as may reasonably be
required by the Title Company or are necessary to consummate this transaction or
to otherwise effect the agreements of the parties hereto.
After Closing, and prior to the complete liquidation of Seller's parent entity,
Seller shall execute and deliver to Purchaser such further documents and
instruments as Purchaser shall reasonably request to effect this transaction and
otherwise effect the agreements of the parties hereto.
13.5 PURCHASER'S CLOSING DELIVERIES.
At Closing (or such other times as may be specified below), Purchaser
shall deliver or cause to be delivered to Seller the following, in form and
substance reasonably acceptable to Seller:
a. Purchase Price. The Purchase Price described in Paragraph 2 by
wire transfer of immediately available funds.
b. Assignments. Executed copies of the Assignment of Contracts and
the Assignment of Leases described in paragraphs 13(c) and 13(d) above.
c. ALTA Statement. If required by the Title Company, an ALTA
Statement in form and substance acceptable to the Title Company.
d. Closing Statement. A closing statement conforming to the
proration and other relevant provisions of this Agreement.
e. Other. Such other documents and instruments as may be reasonably
required by the Title Company and that are necessary to consummate this
transaction and to otherwise effect the agreements of the parties hereto.
14. PRORATIONS AND ADJUSTMENTS.
The following shall be prorated and adjusted between Seller and
Purchaser as of the Closing Date, except as otherwise specified:
a. The amount of all security and other Tenant deposits, and
interest due thereon, if any, shall be credited to Purchaser.
b. Purchaser and Seller shall divide the cost of any escrows
hereunder equally between them.
17
c. Water, electricity, sewer, drainage, gas, telephone and other
utility charges based, to the extent practicable, on final meter readings and
final invoices.
d. Amounts paid or payable under the Assigned Contracts shall be
prorated.
e. All accrued general real estate (not recoverable from Tenants),
personal property and ad valorem taxes for the current year applicable to the
Project (not recoverable from Tenants)shall be prorated on an accrual basis,
utilizing actual final tax bills, if available prior to Closing. If such bills
are not available, then such taxes shall be prorated on the basis of the most
currently available tax bills for the Project. Prior to or at Closing, Seller
shall pay or have paid all tax bills that are due and payable prior to or on the
Closing Date and shall furnish evidence of such payment to Purchaser and the
Title Company. At Closing, Seller shall cause the Title Company to insure over
the 2001 real estate taxes for the Project. Real estate taxes shall not be
reprorated after Closing.
f. All assessments, general or special, shall be prorated as of the
Closing Date, with Seller being responsible for any installments of assessments
which are or have accrued due prior to the Closing Date and Purchaser being
responsible for any installments of assessments which are due or will accrue on
or after the Closing Date.
g. All Base Rents and other charges, including, without limitation,
all Additional Rent, shall be prorated at Closing and there shall be no
reproration. At the Closing, no "Delinquent Rents" (rents or other charges that
are due as of the Closing) shall be prorated in favor of Seller. Notwithstanding
the foregoing, Purchaser shall use reasonable efforts after the Closing Date to
collect any Delinquent Rents (which shall include Base Rents and Additional
Rents) due to the Seller from Tenants, but Purchaser shall not be required to
xxx any Tenants. At closing Seller shall provide Purchaser with an itemized
schedule of Delinquent Rents. All rents and other charges received by Purchaser
from any Tenant after the Closing shall be first applied to obligations then due
which pertain to the period from and after the Closing Date. Any excess shall be
applied against delinquent and past due obligations owed to, or for the benefit
of, Seller [with respect to those obligations accruing prior to the Closing
Date]. In no event, however, shall any sums be paid to the Seller to the extent
the Seller has been previously reimbursed for such default out of any security
deposit and security deposits have been appropriately prorated hereunder.
On or before the fifteenth (15th) day of each calendar month,
beginning with the first calendar month following the Closing Date, Purchaser
shall provide to Seller an accounting of all Delinquent Rents received by
Purchaser during the prior calendar month. On the same date, Purchaser shall
remit to Seller one-half (1/2) of the amount of Delinquent Rents received by
Purchaser during the prior calendar month. Purchaser shall retain the balance of
the Delinquent Rents as its fee for collection of same. Seller, at Seller's
expense, shall be entitled to audit on a periodic basis the cash receipts of
Purchaser in order to ascertain compliance with the foregoing.
18
(h) In the event Purchaser elects to assume the Existing
Indebtedness, Seller shall receive, as a proration credit at Closing, a credit
in the amount of the various deposits and escrows maintained by GECC for the
benefit of the Project for real estate taxes, insurance and capital improvements
but only to the extent to which such escrows are assigned to, and become the
property of, Purchaser.
i. Such other items that are customarily prorated in transactions of
this nature shall be ratably prorated.
For purposes of calculating prorations, Purchaser shall be deemed to be in title
to the Project, and therefore entitled to the income therefrom and responsible
for the expenses thereof, for the entire day upon which the Closing occurs. All
such prorations shall be made on the basis of the actual number of days of the
year and month that shall have elapsed as of the Closing Date. Items of income
and expense for the period prior to the Closing Date will be for the account of
Seller and items of income and expense for the period on and after the Closing
Date will be for the account of Purchaser, all as determined by the accrual
method of accounting. Bills received after Closing that relate to expenses
incurred, services performed or other amounts allocable to the period prior to
the Closing Date shall be paid by Seller. Any amounts not so paid by Seller may
be set off against amounts (if any) otherwise due Seller hereunder.
15. CLOSING EXPENSES.
Purchaser shall pay the entire cost of the Title Policy (including all
endorsements), and Seller shall pay the entire cost of the survey. All
documentary and state, county and municipal transfer taxes relating to the
conveyance contemplated herein shall be paid by Seller. Each party shall pay
one-half of the cost of any escrows hereunder. Purchaser shall pay the entire
cost of the UCC Searches, the cost of recording the Assignment of Ground Lease,
and, if applicable, the entire cost associated with the assumption of the
Existing Indebtedness, including, without limitation, any assumption fee and the
fees of GECC's Counsel. If Purchaser elects to discharge (rather than assume)
the Existing Indebtedness, Purchaser shall pay the entire cost of the prepayment
penalty associated therewith.
16. DESTRUCTION, LOSS OR DIMINUTION OF PROJECT
If, prior to Closing, all or any portion of the Project is damaged by
fire or other natural casualty (collectively "Damage"), or is taken or made
subject to condemnation, eminent domain or other governmental acquisition
proceedings (collectively "Eminent Domain"), then the following procedures shall
apply:
a. If the aggregate cost of repair or replacement of the Damage
(collectively, "repair and/or replacement") is $250,000.00 or less, or if the
value of the Project is not materially reduced by the Eminent Domain, in the
opinion of Purchaser's and Seller's
19
respective engineering consultants, Purchaser shall be obligated to close the
transaction and the provisions of Paragraph 16 b. (ii) (1) and (2) below shall
control.
b. If the aggregate cost of repair and/or replacement of the Damage
is greater than $250,000.00, or if the value of the Project is materially
reduced by the Eminent Domain, in the opinion of Purchaser's and Seller's
respective engineering consultants, then Purchaser, at its sole option, may
elect either to (i) terminate this Agreement by written notice to Seller and
receive an immediate return of the Xxxxxxx Money, together with all interest
earned thereon, and neither party shall have any further liability to the other
hereunder, except as otherwise provided herein; or (ii) proceed to close subject
to (1) a credit against the Purchase Price in the amount of the deductible under
the applicable insurance policies, and (2) an assignment of the proceeds of
Seller's casualty insurance for all such Damage (or condemnation awards for any
Eminent Domain). In such event, Seller shall fully cooperate with Purchaser in
the adjustment and settlement of the insurance claim. The proceeds and benefits
under any rent loss or business interruption policies attributable to the period
following the Closing shall likewise be assigned to Purchaser.
c. In the event of a dispute between Seller and Purchaser with
respect to the cost of repair and/or replacement or the materiality of the
reduction of the value of the Project resulting from the Eminent Domain with
respect to the matters set forth in this Paragraph 16, an engineer designated by
Seller and an engineer designated by Purchaser shall select an independent
engineer licensed to practice in the jurisdiction where the Project is located
who shall resolve such dispute. All fees, costs and expenses of such third
engineer so selected shall be shared equally by Purchaser and Seller.
17. DEFAULT/FAILURE OF CONDITION PRECEDENT
a. Breach. If any representation or warranty of Seller is untrue or
incorrect in any material respect, or if Seller otherwise defaults under or
otherwise breaches this Agreement, then in addition to and not in lieu of any
other rights or remedies available to Purchaser at law or in equity (including
recovery by Purchaser of all damages and costs), Purchaser shall have: (i) the
right to terminate this Agreement and receive the return of all monies paid to
Seller or deposited in escrow, with interest accrued thereon from the date
originally paid by Purchaser to the date such funds are repaid to Purchaser and
(ii) the right of specific performance.
b. Default by Purchaser. In the event Purchaser defaults in its
obligations to close the purchase of the Project and Seller is not then in
default, then Seller's sole and exclusive remedy shall be to cause the Escrowee
to deliver the Xxxxxxx Money, together with all interest earned thereon, to
Seller, the amount thereof being fixed and liquidated damages, it being
understood that Seller's actual damages in the event of such default are
difficult to ascertain and that such proceeds represent the parties' best
current estimate of such damages and are not a penalty. Except as otherwise
provided for herein, Seller shall have no other remedy for any default by
Purchaser.
20
c. Failure of a Condition Precedent. In the event any condition
precedent described herein (a "Condition Precedent") shall not, at or before its
final date for performance or Closing, whichever is earlier, have been fulfilled
or waived in writing by the party for whose benefit the condition exists and
such party is not in default hereunder, then such party may, at Closing, by
written notice to the other party, elect to terminate its obligations under this
Agreement in which event the Xxxxxxx Money together with all interest earned
thereon, shall be returned immediately to Purchaser and, except as otherwise
provided herein, the parties shall have no further liability to each other. Each
party covenants to immediately notify the other party if any condition precedent
becomes impossible to achieve.
18. SUCCESSORS AND ASSIGNS.
The terms, conditions and covenants of this Agreement shall be binding
upon and shall inure to the benefit of the parties and their respective
nominees, successors, beneficiaries and assigns; provided, however, no
conveyance, assignment or transfer of any interest whatsoever of, in or to the
Project or of this Agreement shall be made by Seller during the term of this
Agreement. Purchaser upon notice to Seller, may assign all or any of its right,
title and interest under this Agreement to any entity which (i) owns or controls
Purchaser or (ii) is more than 50% owned or whose voting interests are more than
50% controlled by Purchaser and/or principals of Purchaser, provided Purchaser
receives no consideration (except nominal consideration) for such assignment. In
the event of a permitted assignment by Purchaser, the Purchaser hereunder shall
remain liable under this Agreement through the Closing.
19. LITIGATION.
In the event of litigation between the parties with respect to the
Project, this Agreement, the Escrow Agreement, the performance of their
respective obligations hereunder or the effect of a termination under this
Agreement or the Escrow Agreement, the non-prevailing party shall pay all costs
and expenses incurred by the prevailing party in connection with such
litigation, including, but not limited to, reasonable attorneys' fees of counsel
selected by the prevailing party. Notwithstanding any provision of this
Agreement to the contrary, the obligations of the parties under this Paragraph
19 shall survive termination of this Agreement.
20. NOTICES.
Any notice, demand or request which may be permitted, required or
desired to be given in connection therewith shall be given in writing and
directed to Seller and Purchaser as follows:
Purchaser: West Coast Realty Investors, Inc.
0000 Xxxx Xxxx Xxxx
00
Xxxxxxxx #0, Xxxxx 000
Xxxxx Xxxx, Xxxxxxxxxx 00000
Attn: Xxxxx X. Xxxxxxxx
650/233-7140
650/000-0000 (fax)
E-Mail:xxxxxxxxx@xxxxxx.xxx
With a copy to Xxxxx X. Xxx, Esq.
its attorneys: Xxxx Xxx Xxxxxxx & Xxxxxxxxx, LLP
000 Xxxxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
770/956-9600
770/000-0000 (fax)
E-Mail: xxxx@xxxx.xxx
Seller: c/o Banyan Strategic Realty Trust
0000 Xxxxxxxxxxx Xxxx, Xxxxx 000X
Xxx Xxxxx, Xxxxxxxx 00000
Attention: Xx. Xxxxxxxxxxx X. Xxxxxx
630/218-7250
630/000-0000 (fax)
E-mail: Xxxxxxx@xxxxxxxxxx.xxx
With a copy to Xxxxxx X. Xxxxxxx
its attorney: 0000 Xxxxxxxxxxx Xxxx, Xxxxx 000X
Xxx Xxxxx, Xxxxxxxx 00000
630/218-7255
630/000-0000(fax)
E-Mail: XXX_Xxxxxx@xxx.xxx
Notices shall be deemed properly delivered and received when and if either (i)
personally delivered; (ii) delivered by Federal Express or other overnight
courier; (iii) three (3) business days after being deposited in the U.S. Mail,
by registered or certified mail, return receipt requested, postage prepaid; (iv)
on the same day if sent by E-Mail or confirmed facsimile transmission before
5:00 P.M. Central Time or (v) on the next business day if sent by E-Mail or
confirmed facsimile transmission, after 5:00 P.M. Central Time. Notices sent in
respect to Paragraph 6(a) hereof shall be effective on the same business day if
such notices are received by any means prior to 8:00 p.m. CDT on the Approval
Date.
21. BENEFIT.
This Agreement is for the benefit only of the parties hereto and their
nominees, successors, beneficiaries and assignees as permitted in Paragraph 18
and no other person or entity shall be entitled to rely hereon, receive any
benefit herefrom or enforce against any party hereto any provision hereof.
22
22. LIMITATION OF LIABILITY.
(a) Upon the Closing, Purchaser shall neither assume nor undertake to
pay, satisfy or discharge any liabilities, obligations or commitments of Seller
other than those specifically agreed to between the parties and set forth in
this Agreement. In the event that Purchaser, in its sole discretion, elects to
assume any of the obligations under any one or more of the Contracts delivered
pursuant to the provisions hereof, it shall so notify Seller, in writing, no
later than 5 days prior to the Approval Date. Except with respect to the
foregoing obligations, Purchaser shall not assume or discharge any debts,
obligations, liabilities or commitments of Seller, whether accrued now or
hereafter, fixed or contingent, known or unknown.
(b) This contract is an obligation of the Seller and Purchaser only.
No personal liability shall be extended to the officers, directors, partners,
members, shareholders, trustees, parent entities or other constituents of the
Purchaser or the Seller. Specifically, and without limiting the foregoing, this
contract shall create no obligations on the part of Banyan Strategic Realty
Trust, its officers, trustees or shareholders.
23. BROKERAGE.
Each party hereto represents and warrants to the other that it has dealt
with no brokers or finders in connection with this transaction other than CFC
Advisory Services Limited Partnership ("Xxxxx Financial") and Leeward
Investments LLC ("Leeward"). Seller and Purchaser each hereby indemnify, protect
and defend and hold the other harmless from and against all losses, claims,
costs, expenses, damages (including, but not limited to, attorneys' fees of
counsel selected by the indemnified party) resulting from the claims of any
broker, finder, or other such party, claiming by, through or under the acts or
agreements of the indemnifying party. Seller confirms its exclusive obligations
(pursuant to a separate agreement) with Xxxxx Financial. Purchaser confirms its
exclusive obligations (pursuant to a separate agreement) with Leeward. The
obligations of the parties pursuant to this Paragraph 23 shall survive any
termination of this Agreement.
24. REASONABLE EFFORTS
Seller and Purchaser shall use their reasonable, diligent and good faith
efforts, and shall cooperate with and assist each other in their efforts, to
obtain such consents and approvals of third parties, to the transaction
contemplated hereby, and to otherwise perform as may be necessary to effectuate
the transfer of the Project to Purchaser in accordance with this Agreement.
23
25. MISCELLANEOUS.
a. Entire Agreement. This Agreement constitutes the entire
understanding between the parties with respect to the transaction contemplated
herein, and all prior or contemporaneous oral agreements, understandings,
representations and statements, and all prior written agreements,
understandings, letters of intent and proposals are merged into this Agreement.
Neither this Agreement nor any provisions hereof may be waived, modified,
amended, discharged or terminated except by an instrument in writing signed by
both parties.
b. Time of the Essence. Time is of the essence of this Agreement. If
any date herein set forth for the performance of any obligations by Seller or
Purchaser or for the delivery of any instrument or notice as herein provided
should be on a Saturday, Sunday or legal holiday, the compliance with such
obligations or delivery shall be deemed acceptable on the next business day
following such Saturday, Sunday or legal holiday. As used herein, the term
"legal holiday" means any state or federal holiday for which financial
institutions or post offices are generally closed in the State of Georgia for
observance thereof.
c. Conditions Precedent. The obligations of the parties to close the
transaction contemplated herein are subject to the express Conditions Precedent
set forth in this Agreement, each of which may be waived by the party in whose
favor such condition exists at any time by written notice thereof to the other
party. The waiver of any particular Condition Precedent shall not constitute the
waiver of any other.
d. Construction. This Agreement shall not be construed more strictly
against one party than against the other merely by virtue of the fact that it
may have been prepared by counsel for one of the parties, it being recognized
that both Seller and Purchaser have contributed substantially and materially to
the preparation of this Agreement. The headings of various Paragraphs in this
Agreement are for convenience only, and are not to be utilized in construing the
content or meaning of the substantive provisions hereof.
e. Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of Georgia.
f. Partial Invalidity. The provisions hereof shall be deemed
independent and severable, and the invalidity or partial invalidity or
enforceability of any one provision shall not affect the validity of
enforceability of any other provision hereof.
g. Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed an original and all of such counterparts together
shall constitute one and the same Agreement.
h. Good Faith. All action required pursuant to this Agreement that
is necessary to effectuate the transaction contemplated herein will be taken
promptly and in good faith
24
by Seller and Purchaser and Seller and Purchaser shall furnish to the other
party hereto such documents or further assurances as the other party hereto may
reasonably require.
i. Capacity. Each person executing this Agreement in a
representative capacity warrants his/her authority to do so, subject to the
provisions of Paragraph 26 below.
26. APPROVAL OF SELLER'S BOARD.
Within five (5) business days of the execution of this Agreement by both
parties, Seller shall present this Agreement for approval to the Board of
Trustees of Banyan Strategic Realty Trust, Seller's parent entity. Seller shall
notify Purchaser in writing of the outcome of such request for approval within
one(1) business day of such action. In the absence of approval by such Board,
this Agreement shall be deemed cancelled, the Xxxxxxx Money shall be returned to
Purchaser, and except as otherwise herein provided, the parties shall have no
further liability to each other.
27. AS-IS, WHERE-IS.
Purchaser acknowledges and agrees that but for the limited
representations and warranties specifically contained herein, the Project is
being sold to Purchaser "As-Is" "Where-Is" and "With All Faults." From and after
the Closing, Purchaser shall have no claim against Seller regarding the
condition of the Project or the breach of any express or any implied warranty or
representation regarding merchantability, suitability or fitness of purpose.
Purchaser is a sophisticated purchaser of real estate and has had an adequate
opportunity to investigate the Project, has conducted or intends to conduct
extensive due diligence and agrees to accept the Project at Closing in its then
current condition, and hereby releases Seller from any claims in respect
thereto. Purchaser further acknowledges that Seller's parent entity has adopted
and is currently executing a Plan of Termination and Liquidation.
IN WITNESS WHEREOF, the parties hereto have executed this Sale Contract
on the date first above written.
PURCHASER: SELLER:
WEST COAST REALTY INVESTORS, INC., a BSRT NORTHLAKE LIMITED PARTNERSHIP,
Delaware corporation an Illinois limited partnership
By: BSRT UPREIT CORP., its sole
general partner
By: /s/Xxxxx X. Xxxxxxxx /s/ Xxxxxx X. Xxxxxxx
------------------------------------ --------------------------------
Name: Xxxxx X. Xxxxxxxx Name: Xxxxxx X. Xxxxxxx
---------------------------------- --------------------------
Title: President and CEO Title: Vice President
---------------------------------- -------------------------
25
SCHEDULE OF EXHIBITS
A Land
A-1 Common Address and Approximate Size of Building
A-2 Listing of the Outparcel Sub-Leases
A-3 Description of Ground Lease
B Personal Property
C Escrow Agreement
D Seller's File
E Permitted Exceptions
F Intentionally Deleted
G Intentionally Omitted
H Contracts
I Rent Roll (Includes Delinquency Report)
J Tax Bills and Pending Tax Protests
K Form of Ground Lessor Estoppel Certificate
O Form of Tenant Estoppel Certificate
Schedules
8(e) Pending Litigation (Seller)
8.5(a) Pending Litigation (Purchaser)
12(a)(2) Ongoing Tenant Disputes Regarding CAM Reconciliation
12(a)(4) Tenant Lease Obligation Matters
12(a)(5) Leasing Commission Obligations (Post-Closing)
12(a)(8) Parking Field Accessibility Rights
-26-
EXHIBIT A
LAND
EXHIBIT A-1
ADDRESS
Address: 0000-0000 XxXxxxx Xxxx
Xxxxxx (Xxxxxxx), XxXxxx Xxxxxx, Xxxxxxx
Approximately 322,000 rentable square feet on approximately 38 acres.
EXHIBIT A-2
OUTPARCEL LEASES
9) Sublease Agreement between Atlanta Northlake Associates, a Texas limited
partnership, and Northlake Atrium, Ltd., a Texas limited partnership,
dated December 27, 1984, recorded in Deed Book 5137, Page 215, aforesaid
records, as amended, assigned, or affected by:
(1) Assigned to Confederation Life Insurance Company (U.S.) In
Rehabilitation pursuant to Deed Under Power of Sale, dated April 4,
1995, filed for record April 4, 1995, recorded on July 27, 1995, in Deed
Book 8509, Page 744, aforesaid records.
(2) Amended by First Amendment to Sublease Agreement between the aforesaid
parties dated June 1, 1995, filed for record July 31, 1995, recorded in
Deed Book 8634, Page 402, aforesaid records.
(3) Fee Owner Recognition Agreement among Xxx Communications, Inc.,
Northlake Atrium, Ltd., a Texas limited partnership, and Atlanta
Northlake Associates, a Texas limited partnership, as Landlord, dated
December 27, 1984, recorded in Deed Book 5137, Page 223, aforesaid
records.
(4) As assigned to Madison, Green Property, LLC, by that Assignment and
Assumption of Sub Lease, dated March 11, 1997, filed for record April
23, 1997, recorded in Deed Book 9403, Page 18, aforesaid records.
(5) As assigned to Appletree Technologies, Inc. by that Assignment and
Assumption of Sub Lease dated July 31, 1997, filed for record August 6,
1997, recorded in Deed Book 9550, Page 511, aforesaid records.
2) Sublease Agreement between Crow-Atlanta Retail, Ltd., a Texas limited
partnership and Marriott Corporation, dated April 5, 1983, evidenced for
record by Short Form Sublease Agreement between the aforesaid parties,
dated April 5, 1983, filed for record April 11, 1983, recorded in Deed
Book 4741, Page 373, aforesaid records; as assigned to Atlanta Northlake
Associates, a Texas limited partnership, under that certain Second
Amendment to Ground Lease Agreement and Assignment.
Agreement between Crow-Atlanta Retail, Ltd., a Texas limited partnership and
Marriot Corporation, dated April 5, 1983, filed for Record April 11, 1983,
recorded in Deed Book 4741, Page 360, aforesaid records, [this matter is
disclosed on that "As-
Built" survey of Northlake Festival for Confederation Life
Insurance Company (U.S.) In Rehabilitation, BSRT/M&J Northlake Limited
Partnership, Northlake Tower Corporation, BSRT Northlake Festival Corp. and
Ticor Title Insurance Company prepared by Xxxxxxx X. Xxxxxx (GRLS No. 1946),
dated August 8, 1984, as last revised October 29, 1997.]
EXHIBIT A-3
THE GROUND LEASE
Ground Lease Agreement between Xxx Communications, Inc., as Landlord and
Crow-Atlanta Retail, Ltd., a Texas limited partnership, as Tenant, dated October
4, 1982, evidenced for record by Short form Ground Lease Agreement between the
aforesaid parties, dated October 4, 1982, filed November 24, 1982, recorded in
Deed Book 4683, Page 186, Office of the Clerk of the Superior Court of DeKalb
County, Georgia, as amended, assigned or affected as follows:
(1) Amended by unrecorded Amendment to Ground Lease Agreement between
the aforesaid parties, dated April 27, 1983.
(2) Amended and assigned by Second Amendment to Ground Lease
Agreement and Assignment among the aforesaid parties and Atlanta
Northlake Associates, a Texas limited partnership, dated December 27,
1984, filed for record January 18, 1985, recorded in Deed Book 5137,
Page 201, aforesaid records.
(3) As assigned to Confederation Life Insurance Company pursuant to
Deed Under Power of Sale dated April 7, 1992 recorded at Deed Book 7235,
page 586 aforesaid records.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
EXHIBIT B
PERSONAL PROPERTY
1. 1993 Club Car Golf Cart Carry-All 2, gasoline-powered
2. 20 ft. aluminum extension ladder
3. 8 ft. fiberglass ladder
4. 6 ft. aluminum step ladder
5. Honda 3000 PSI pressure washer
6. Tool pouch w/assorted hand tools
7. 18 volt cordless drill
8. Hand cart w/rubber wheels
9. Wooden furniture moving dolly
10. Xxxx Xxxxxxx L-shaped office desk w/chair
11. 6 red office chairs
12. Blue Ridge Mountain water cooler with 4 bottles leased from water co.
13. Various office supplies, paper, pencils, pens, stapler, etc.
14. Royal electronic time clock
15. Sharp UX-510 plain paper fax machine
16. 2 telephones
17. 3 Nextel radio/telephones used for security
18. 2002 Chevy TrailBlazer, leased for security force
19. Ryobi hand-held gasoline leaf blower
20. Various small equipment such as brooms, shovels, xxxxx, garden hoses, etc.
21. Nikon One-Touch 35 mm camera
EXHIBIT C
ESCROW AGREEMENT
These Xxxxxxx Money Escrow Instructions ("Instructions") are entered
into this ___ day of _________, 2002, by and between West Coast Realty
Investors, Inc. ("Purchaser"), BSRT Northlake Limited Partnership (the
"Seller"); and Chicago Title Insurance Company ("Escrowee").
RECITALS
A. Purchaser and Seller entered into a Sale Contract, dated April
_______, 2002 (the "Agreement"), for the purchase and sale of the real property
commonly known by the address listed on Exhibit A-1 to the Sale Contract,
located in Tucker, Georgia ("Property").
WHEREAS, the parties desire to enter into escrow instructions with the
Escrowee pursuant to which the Purchaser shall deposit xxxxxxx money, as
required under the Agreement; and
NOW THEREFORE, in consideration of the mutual covenants contained in
these Instructions, and other good and valuable consideration, the receipt and
legal sufficiency of which are hereby acknowledged, the parties agree as
follows:
1. Deposit.
X. Xxxxxxx Money. Purchaser has pursuant to the terms and
provisions of the Agreement, simultaneously with the execution hereof, deposited
with Escrowee xxxxxxx money in the sum of Two Hundred Thousand and No/100
($200,000.00) (the "Xxxxxxx Money").
B. Subsequent Xxxxxxx Money Deposit. On the Approval Date,
Purchaser shall deposit the additional sum of Two Hundred Thousand and no/100
Dollars ($200,000) into the Escrow and pursuant to the terms of the Escrow
Agreement as additional Xxxxxxx Money. From and after the deposit of the
additional $200,000, the aggregate sum of $400,000 shall be deemed to be the
"Xxxxxxx Money" hereunder and such Xxxxxxx Money shall be nonrefundable to the
Purchaser except as provided in the Agreement.
C. Investment of Xxxxxxx Money. Escrowee shall invest the
Xxxxxxx Money in an interest-bearing account with an FDIC-insured bank having
gross assets in excess of $1,000,000,000.00. All interest earned on the Xxxxxxx
Money shall be paid to Purchaser.
2. Termination On or Before Approval Date. The Agreement provides
certain circumstances in which Purchaser shall have the right to terminate the
Agreement on or before _______________, 2002 (the "Approval Date"), by delivery
of written notice to Seller (the "Investigation Termination Notice"). Upon
receipt of the Investigation Termination Notice, the Escrowee shall notify
Seller of its receipt of the Investigation Termination Notice by sending a copy
of the Investigation Termination Notice to Seller as provided in Paragraph 5
below, and Escrowee shall, immediately upon receiving the Investigation
Termination Notice on or before the Approval Date, and without the need for
consent or direction by Seller, disburse the full amount of the Xxxxxxx Money,
together with any interest earned on the Xxxxxxx Money, to Purchaser.
3. Default.
A Purchaser's Default. In order to obtain the Xxxxxxx Money
from the Escrowee, Seller shall be required to present to the Escrowee its
written statement (the "Default Notice"), that Purchaser is in default under the
Agreement and that Seller is therefore entitled to the proceeds of the Xxxxxxx
Money pursuant to the Agreement. Upon receipt of such Default Notice from
Seller, the Escrowee shall (i) notify Purchaser of its receipt of such statement
by sending a copy thereof to Purchaser as provided in Paragraph 5 hereunder, and
(ii) if, within five (5) business days after the date of delivery of such
Default Notice to Purchaser, Escrowee has not received from Purchaser a notice
("Objection Notice") objecting to Escrowee's compliance with the Default Notice,
Escrowee shall deliver the Xxxxxxx Money, together with any interest earned on
the Xxxxxxx Money, to Seller.
B. Seller's Default. Except as specifically provided in
Paragraph 2 above and 3C below, in order to obtain the Xxxxxxx Money from the
Escrowee, Purchaser shall, except as otherwise specifically provided in
Paragraph 2 and 3C of these Instructions, be required to present to the Escrowee
its written Default Notice that Seller is in default under the Agreement and
that Purchaser is therefore entitled to the proceeds of the Xxxxxxx Money. Upon
receipt of such Default Notice, the Escrowee shall (i) notify Seller of its
receipt of such statement by sending a copy of such statement to Seller as
provided in Paragraph 5 hereunder, and (ii) if, within five (5) business days
after the date of delivery of such Default Notice to Seller, Escrowee has not
received from Seller an Objection Notice, objecting to Escrowee's compliance
with the Default Notice, Escrowee shall deliver the Xxxxxxx Money, together with
all interest earned thereon, to Purchaser.
C. Other Terminations. The Agreement provides certain
circumstances (for example, casualty or condemnation or failure of a Condition
Precedent to occur) in which Purchaser or Seller shall have the right to
terminate the Agreement. Upon receipt of notice in accordance with the Agreement
that the Agreement is being so terminated, Escrowee shall follow the same
procedure as set forth in Paragraph 3B as if such notice were a Default Notice,
and shall disburse the Xxxxxxx Money in the same fashion as therein set forth
and in accordance with Paragraph 4 below (if applicable).
4. Objection Notices. If the Escrowee receives an Objection Notice
within the time period set forth in Paragraph 3 above, then Escrowee shall
refuse to comply with the Default Notice until the Escrowee receives (a) joint
written instructions executed by both Purchaser and Seller, or (b) a final
non-appealable order with respect to the disposition of the Xxxxxxx Money from a
federal or state court of competent jurisdiction, in either of which events
Escrowee shall then disburse the Xxxxxxx Money and all interest earned thereon,
in accordance with such direction. Notwithstanding the immediately preceding
sentence, if the party that delivered the Objection Notice does not (i) commence
litigation with respect to the Xxxxxxx Money by filing a complaint or action for
a declaratory judgment in an appropriate court of competent jurisdiction, and
(ii) provide notice and a copy of such complaint or action for declaratory
judgment to the Escrowee and the other party to these Instructions within
forty-five (45) days after delivery of an Objection Notice, then Escrowee shall
disburse the Xxxxxxx Money in accordance with the Default Notice.
5. Notices. Any notice, demand or request which may be permitted,
required or desired to be given in connection therewith shall be given in
writing and directed to Seller, Purchaser and Escrow Agent as follows:
Purchaser: West Coast Realty Investors, Inc.
0000 Xxxx Xxxx Xxxx
Xxxxxxxx #0, Xxxxx 000
Xxxxx Xxxx, Xxxxxxxxxx 00000
Attn: Xxxxx X. Xxxxxxxx
650/233-7140
650/000-0000 (fax)
E-Mail: xxxxxxxxx@xxxxxx.xxx
With a copy to Xxxxx X. Xxx, Esq.
its attorneys: Xxxx Xxx Xxxxxxx & Xxxxxxxxx, LLP
000 Xxxxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
770/956-9600
770/000-0000 (fax)
E-Mail: xxxx@xxxx.xxx
Seller: c/o Banyan Strategic Realty Trust
0000 Xxxxxxxxxxx Xxxx, Xxxxx 000X
Xxx Xxxxx, Xxxxxxxx 00000
Attention: Xx. Xxxxxxxxxxx X. Xxxxxx
630/218-7250
630/000-0000 (fax)
E-mail: Xxxxxxx@xxxxxxxxxx.xxx
With a copy to Xxxxxx X. Xxxxxxx
its attorney: 0000 Xxxxxxxxxxx Xxxx, Xxxxx 000X
Xxx Xxxxx, Xxxxxxxx 00000
630/218-7255
630/000-0000(fax)
E-Mail: XXX_Xxxxxx@xxx.xxx
Escrow Agent: Chicago Title Insurance Company
Attn: Xxxxx Xxxxxx
000 X. Xxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Phone: 213/000-0000
Fax: 213/000-0000
E-Mail: XxxxxxX@XXX.xxx
Notices shall be deemed properly delivered and received when and if either (i)
personally delivered; (ii) delivered by Federal Express or other overnight
courier; (iii) three (3) business days after being deposited in the U.S. Mail,
by registered or certified mail, return receipt requested, postage prepaid; (iv)
on the same day if sent by E-mail or confirmed facsimile transmission before
5:00 P.M. Central Time or (v) on the next business day if sent by E-Mail or
confirmed facsimile transmission, after 5:00 P.M. Central Time.
6. Escrowee Obligations. The parties agree that the actions of, and
the relationship between the Purchaser and Seller shall be governed by the terms
of the Agreement. Notwithstanding the existence of the Agreement or any
references herein to the Agreement, the parties agree that the Escrowee shall be
governed solely by the terms and provisions of these Instructions. The parties
furthermore agree that except as specifically provided in Paragraph 4 above, the
Escrowee is hereby expressly authorized to regard and to comply with, and obey,
any and all orders, judgments or decrees entered or issued by any court, and, in
case the Escrowee obeys and complies with any such order, judgment or decree of
any court, it shall not be liable to any of the parties hereto or to any other
person, firm or corporation by reason of such compliance. Notwithstanding any
such order, judgment or decree entered without jurisdiction or subsequently
reversed, modified, annulled, set aside or vacated in case of any suit or
proceeding regarding this escrow to which Escrowee is or may be at any time a
party, it shall have a lien on the contents hereof for any or all costs,
attorneys' fees (whether such attorneys shall be regularly retained or specially
employed) and other expenses which have been incurred by Escrowee or for which
Escrowee becomes liable for on account and Escrowee shall be entitled to
reimburse itself therefor out of the Xxxxxxx Money deposit and the undersigned
jointly and severally agree to pay said Escrowee, upon demand, all such costs
and expenses so incurred. The Escrowee hereby submits to jurisdiction in the
State of Georgia, Xxxxxx or DeKalb County.
7. Conflict. The terms and conditions of this Agreement are in
addition to the terms and conditions of the Sale Contract between Seller and
Purchaser dated the date hereof. In the event of a conflict between the
agreements, Escrow Agent shall first refer to this agreement, then to the Sale
Contract.
PURCHASER: SELLER:
WEST COAST REALTY INVESTORS, INC., a BSRT NORTHLAKE LIMITED PARTNERSHIP,
Delaware corporation an Illinois limited partnership
By: BSRT UPREIT CORP., its sole
general partner
By: By:
---------------------------------- -------------------------------
Name: Name: Xxxxxx X. Xxxxxxx
------------------------------- -----------------------------
Title: Title: Vice President
------------------------------- ----------------------------
ACCEPTED BY ESCROWEE:
CHICAGO TITLE INSURANCE COMPANY
By:
----------------------------------
Name:
-------------------------
Title:
------------------------
Escrow No.
---------------------------
EXHIBIT D
SELLER'S FILE
1. Copies of any and all Leases.
2. A rent roll (the "Rent Roll"), with the current delinquency
report attached as an exhibit.
3. Copies of the xxxx or bills issued for the years 2000, 2001 ,
and, if available, 2002, for all real estate taxes and personal property taxes
and copies of any and all notices pertaining to real estate taxes or assessments
applicable to the Project (the "Tax Bills"). Seller shall promptly deliver to
Purchaser copies of any such bills or notices received by Seller after the
Contract Date, even if received after Closing.
4. Copies of all brokerage commission, leasing, maintenance, repair,
service, pest control and supply contracts (including, without limitation,
janitorial, elevator, scavenger, laundry and landscaping agreements), equipment
rental agreements and master antenna agreements (if applicable), and any other
contracts or agreements relating to or affecting the Project or which will be
binding upon the Project or Purchaser subsequent to Closing, all as amended,
including, without limitation the management contract and all service contracts
(the "Contracts").
5. Copies of any guarantees, warranties and other documents
or instruments evidencing or relating to the Intangible Personal
Property, and the Governmental Approvals, in Seller's possession
or control.
6. Copies of all easements and licenses of Seller for the
benefit of the Project or of third parties burdening the Project
which are not recorded/filed against the Project, in Seller's
possession or control.
7. Copies of any existing title insurance policies, title
insurance commitments and/or surveys in Seller's possession or
control.
8. Copies of any and all appraisals, property inspections,
engineering and environmental reports.
9. Property operating statements for calendar years 2000,
2001 and 2002 (to the extent available).
10. Copies of the Ground Lease and all amendments thereto,
together with all correspondence and other documents in Seller's
possession or control relating to the Ground Lease.
EXHIBIT E
PERMITTED EXCEPTIONS
[This Exhibit is subject to review and reasonable approval of
Purchaser upon receipt of the title commitment and copies of the Schedule B
documents.]
1. All taxes and assessments subsequent to the year 2001, and any
additional taxes which may result from a reassessment of the subject property.
2. Ground Lease Agreement between Xxx Communications, Inc., as Landlord and
Crow-Atlanta Retail, Ltd., a Texas limited partnership, as Tenant, dated October
4, 1982, evidenced for record by Short form Ground Lease Agreement between the
aforesaid parties, dated October 4, 1982, filed November 24, 1982, recorded in
Deed Book 4683, Page 186, Office of the Clerk of the Superior Court of DeKalb
County, Georgia, as amended, assigned or affected as follows:
(1) Amended by unrecorded Amendment to Ground Lease Agreement
between the aforesaid parties, dated April 27, 1983.
(2) Amended and assigned by Second Amendment to Ground Lease
Agreement and Assignment among the aforesaid parties and
Atlanta Northlake Associates, a Texas limited partnership,
dated December 27, 1984, filed for record January 18,
1985, recorded in Deed Book 5137, Page 201, aforesaid
records.
(3) As assigned to Confederation Life Insurance Company
pursuant to Deed Under Power of Sale dated April 7, 1992
recorded at Deed Book 7235, page 586 aforesaid records.
[The Remainder of this page intentionally left blank]
EXHIBIT F
Intentionally Deleted
EXHIBIT H
CONTRACTS
1. Schedule of Equipment Leases
1. Security Trailer
Xxxxxxxx-Scotsman dated 5/22/97 [$438.17 per month]
2. GMAC SmartLease Agreement covering 2002 Chevrolet TrailBlazer
between Xxx Xxxxx Chevrolet of Atlanta, as lessor, and M & J
Wilkow, Ltd., as agent for BSRT/M&J Northlake Limited Partnership
for 3 year Term. [$435.14 per month]
3. Equipment Lease Agreement and Service Package Guaranty dated on
or about June 18, 1997 entered into between Sensormatic
Electronics Corporation d/b/a CamEra Security Services and M & J
Wilkow, Ltd., as agent for BSRT/M&J Northlake Limited Partnership
covering security camera equipment. [$796.08 per month]
2. Schedule of Service Contracts
1. Trash Removal
Apollo Waste Industries dated 1/24/00
2. Parking Lot Sweeping
Litter Control dated 9/26/96
3. Exterminator
Terminix dated 5/8/98
4. Landscaping
Xxxxxxx Group dated 9/21/99
5. HVAC - Cooling Towers
McKenney's dated 9/29/95
6. Water Treatment - Cooling Towers
Neptune Water Services 9/1/93
7. Marketing Agreement
Marketing Promotions Group - Project by Project Basis
8. Nextel Agreement
Covering 3 Nextel Phones (for telephone service only)
9. Blue Ridge Mountain Water Cooler Agreement
Month to Month to Agreement
10. Leasing Agreement
Spectrum Realty Advisors, Inc. dated 3/15/02
11. Management Agreement
Spectrum Xxxxxx Management, LLC. dated 3/15/02
EXHIBIT I
RENT ROLL
(Includes Delinquency Report)
EXHIBIT J
MOST RECENT TAX XXXX AND PENDING TAX PROTESTS
EXHIBIT K
FORM OF GROUND LESSOR ESTOPPEL CERTIFICATE
EXHIBIT "O"
TENANT ESTOPPEL CERTIFICATE
TO: [PURCHASER] ("Owner") AND ____________________ ("LENDER")
RE: NORTHLAKE TOWER FESTIVAL SHOPPING CENTER
3983 LA VISTA ROAD
XXXXXX (ATLANTA), GEORGIA (THE "PROPERTY")
LEASE DATE:
BETWEEN: ___________________________________________________("LANDLORD")
AND ___________________________________________________("TENANT")
SQUARE FOOTAGE LEASED: ________________________
SUITE NO.: ______________________________ ("PREMISES")
Tenant understands that Lender is contemplating making a loan (the
"LOAN") to Owner and that Owner intends to acquire the Property. The
undersigned, as the tenant under the above-referenced lease ("LEASE") hereby
certifies, as of the date hereof, to Owner, Lender, and any other lenders now or
hereafter holding a deed to secure debt on the property, the following:
The lease attached hereto as Exhibit "A" and incorporated herein is a
true, correct, and complete copy of the Lease, including all applicable
guarantees, if any (the "Guaranties"). The Lease and each of the Guaranties (if
any) is in full force and effect and has not been modified, supplemented, or
amended in any way and the Lease and the Guaranties (if any) represents the
entire agreement between the parties as to the Premises or any portion thereof.
The amount of fixed monthly rent is $___________; the percentage rent
(if any) is ________; the monthly common area or other charges are $___________.
The base year for operating expenses and real estate taxes, as defined in the
Lease, is ___________. No such rent has been or will be paid more than one (1)
month in advance of its due date, except: ___________.
The undersigned's security deposit is $___________. The undersigned has
paid rent for the Premises up to and including ___________, 20____. The
undersigned hereby waives collection of the deposit against Lender or any
purchaser at a foreclosure sale, unless Lender or such purchaser actually
received the deposit from Landlord.
Check one: ( ) The undersigned is currently in occupancy.
( ) The undersigned intends to take occupancy on _________.
The Lease will not be altered or amended, without Lender's prior written
consent.
The commencement date of the Lease was ________________, ____, the Lease
terminates on ___________ and we have the following renewal/extension option(s)
___________.
All work to be performed for us under the Lease has been performed as
required and has been accepted by us; and any payments, free rent, or other
payments, credits, allowances or abatements required to be given by Landlord to
us have already been received by us, except ___________.
The Lease is free from default by Landlord; we have no offset, defence,
deduction or claim against Landlord.
The undersigned has received no notice of any prior sale, assignment,
pledge or other transfer of the said Lease or of the rents received therein,
except the sale by M & J Wilkow, Ltd. of its partial interest in the Premises to
BSRT UPREIT CORP. and BSRT UPREIT Limited Partnership in March of 2002 and
except ______________________.
The undersigned has not assigned said Lease or sublet all or any portion
of the Premises, the undersigned does not hold the Premises under assignment or
sublease, nor does anyone except us and our employees occupy the Premises except
____________________.
The undersigned has no right of first refusal or option or other right
to purchase all or any part of the Premises or the building of which the
Premises is a part or to occupy any additional space at the Property, except as
follows: __________________________.
No actions, whether voluntary or otherwise, are pending against the
undersigned under the bankruptcy laws of the United States or any state and
there are no claims or actions pending against the undersigned which if decided
against us would materially and adversely affect our financial condition or our
ability to perform the tenant's obligations under the Lease; and
The undersigned is the Tenant under the lease. If the undersigned is not
the party named in the Lease, unless already attached hereto as a part of
Exhibit A, described below is the chain of assignments into the undersigned. A
copy of each assignment document is attached hereto: ___________.
Executed this __________ day of ________________, ____________.
[TENANT]
By:_____________________________________
Name:___________________________
Title:__________________________
SCHEDULE 8(e)
PENDING LITIGATION (SELLER)
NONE
INSURANCE CLAIMS
(1) A property damage claim (to vehicle) was filed by a Xxxxxxxx Xxxxx
relating to an incident that occurred on or about December 10, 1999.
(2) Recently we became aware of the following circumstance that may give
rise to an insurance claim: a patron of the Petsmart store by the name of
Xxxxxxx XxXxxxx slipped and fell in the parking lot and/or was pulled to the
ground by her pet dog on approximately January 4, 2002. We are not aware of any
person injury claim that has been filed to date relating to such matter but she
has submitted medical bills.
(3) Previous Claims/Payments:
(1) Xxxxxxxx Xxxxx - DOA 4/00, slip & fall, Paid $935.00
(2) Xxxx Xxxxxxxx - DOA 3/96, slip & fall, Paid $74.00
(3) Xxxx Xxxx - DOA 1/97, slip & fall, Paid $0.00
(4) Chirsit Numez - DOA 3/98, property stolen, Paid $0.00
(5) Xxxxxx Xxxxxx - DOA 8/98, injury, Paid $0.00
(6) Xxxx Xxxxx - DOA 7/99, slip & fall, Paid $0.00
(7) Cooling Tower Claim - DOA, 7/96, Paid $290.00
(8) Planter damage - DOA 4/98, Paid $0.00
(9) Wind Storm Claim - DOA 4/98, Paid $0.00
(10) landscape Fire Claim - DOA 5/99, Paid $19,069.00
(11) Misc. Property Claim - DOA 4/99, Paid $1,000
SCHEDULE 8.5(a)
PENDING LITIGATION (PURCHASER)
SCHEDULE 12(a)(2)
ONGOING TENANT DISPUTES REGARDING CAM RECONCILIATIONS
(1) Toys R US ("TRU") exercised its audit rights under both its Toys R Us
and Kids R Us lease agreements on or about January 29, 2001. Sometime in May,
2001, TRU performed an audit for years 1997-1999. TRU's audit results dated
November 15, 2001 requested CAM adjustments in the amount of $143,000.50 (total
for both leases) and auditor fees in the amount of $18,000. At a meeting between
the property manager and TRU on February 12, 2002, additional documentation was
provided to TRU to substantiate certain CAM expenses which TRU disputed in the
audit results. On March 1, 2002, we sent a comprehensive response to TRU
addressing the audit results and the issues raised in the February meeting. Our
response proposed in settlement, credits to TRU in the amount of $21,661.45
($15,114.80 under the Toys R Us lease and $6,546.65 under the Kids R Us lease)
plus a maximum $9,000 for audit fees incurred by TRU. We were advised by TRU
yesterday, that it is not in agreement with the settlement proposed in our March
1, 2002 letter. One additional note, it was discovered on or about March 12,
2002 that the 1998 and 1999 revised reconciliations submitted to TRU with
respect to the Kids R Us lease erroneously applied a 4.77% share rather than a
4.44% share. As a result of the new calculation, TRU is due an additional
$2,338.65 credit. A meeting has been scheduled for May 2, 2002 to further
discuss the disputes.
(2) Michaels conducted an audit of its CAM expenses for years 1998-1999. The
only issue that has remained in dispute is the pass-thru of management fees as a
Cam expense. In exchange for Michaels agreement to resolve all issues relating
to that audit, we agreed to not pass-thru such fees for the audit years and
credit Michaels $607.47, total for both years. Michaels made a counterproposal
by adding to the settlement letter that landlord agrees to not pass-thru
management fees for the remainder of the lease term. This issue remains
outstanding.
(3) Petsmart has contacted us concerning calendar year 2000 CAM
reconciliation and is claiming to have been over-billed by $10,114.00.
Landlord's current position is that Petsmart is owed $5,485.00. In addition,
note should be made that Petsmart owes Landlord $14,602.00 in respect of
calendar year 1999 CAM reconciliation. Landlord also will owe Petsmart audit
fees of @2,654.00 relative to the 1999 CAM.
(4) A circumstance exists that may lead to a claim. A security trailer is
leased and operated at the property by the landlord. Petsmart has orally
objected to the presence of such trailer and its use relative to CAM costs.
(5) A circumstance exists that may lead to claims. The submeter readings for
water and electricity service to the cooling towers at the property were
misallocated to several tenants. Accordingly, some tenants may have claims
relative to overpayment of CAM as to such submeter reading amounts. It is
estimated that the maximum aggregate misallocation annually was approximately
$15,000.00 (Petsmart, Kids R Us and Toys R Us have been given credits in
connection with the audits referenced above). Owner has records of the
meter readings from August, 1999 but the cooling tower submeter calculation was
not included in the CAM reconciliation properly until December, 2001.
SCHEDULE 12(a)(4)
TENANT LEASE OBLIGATION MATTERS
(1) AMC notified Landlord, in writing, of its intention to cease operations
at Northlake effective August 31, 2001. To date, AMC remains open and
operating and no further written communication has been received,
although verbally AMC maintains that this location is losing money and
therefore remains a candidate for closure.
(2) Michaels vacated their space in February, 2002, relocating to the former
Drug Emporium site cross the street, and remains current on lease
payments. See also scheduled 12(a)(2).
SCHEDULE 12(a)(5)
LEASING COMMISSION OBLIGATIONS (POST CLOSING)
None, other than contingent claims of T.C. Atlanta, Inc. should leases
be executed with the four entities identified on the attached Estoppel
Certificate.
SCHEDULE 12(a)(8)
PARKING FIELD ACCESSIBILITY RIGHTS
A circumstance exists that relates to an apparent conflict in parking
field accessibility rights of tenants granted in existing documentation (all of
which documentation pre-dates the acquisition of the property by BSRT/M&J
Northlake Limited Partnership). The tenant demised the Atrium Office Building
under a certain sub-ground lease is also exclusively demised the entire parking
field surrounding the Atrium Office Building. In-line tenants at the shopping
center have been granted the right to park in the same parking field exclusively
demised to the Atrium Office Building.
