Exhibit 10.46
AGREEMENT OF PURCHASE AND SALE OF
MEMBERSHIP INTERESTS
THIS AGREEMENT OF PURCHASE AND SALE OF MEMBERSHIP INTERESTS (this
"AGREEMENT") is made and entered into as of the 29th day of May, 2003, by and
among XXXXXXX GRANDE, INC., a California corporation ("XXXXXXX GRANDE") and
XXXXXXX PROPERTIES, INC., a California corporation ("XXXXXXX PROPERTIES")
(Xxxxxxx Grande and Xxxxxxx Properties are hereinafter collectively referred to
as "SELLER") having an office at c/o Wells Fargo Bank, N.A., 000 Xxxxx Xxxxx
Xxxxxx, Xxxxx 000, Xxx Xxxxxxx, Xxxxxxxxxx 00000 and XXXXXXX PARTNERS-BUNKER
HILL, LTD., a California limited partnership ("BUNKER HILL") having an office at
000 Xxxx Xxxxx Xxxxxx, Xxxxx 0000, Xxx Xxxxxxx, XX, 00000.
RECITALS
North Tower, LLC ("PROPERTY LLC") is a Delaware limited liability company
which owns the 54-story office tower known as the Xxxxx Fargo Tower, having an
address of 000 Xxxxx Xxxxx Xxxxxx, Xxx Xxxxxxx, Xxxxxxxxxx 00000. Pursuant to an
Amended and Restated Operating Agreement of North Tower, LLC dated April 27,
1998, Property LLC has two members: North Tower Manager, LLC ("MANAGER LLC")
which owns 0.5% of the membership interests in Property LLC; and North Tower
Member, LLC ("MEMBER LLC") which owns 99.5% of the membership interests in
Property LLC. Pursuant to the Operating Agreement of North Tower Manager, LLC
dated as of April 27, 1998 ("MANAGER OPERATING AGREEMENT"), Xxxxxxx Grande is a
Class A Member and owns a 42% membership interest in Manager LLC. Pursuant to
the Operating Agreement of North Tower Member, LLC dated as of April 27, 1998
("MEMBER OPERATING AGREEMENT"), Xxxxxxx Properties is a Class A Member and owns
a 42% membership interest in Member LLC.
Seller wishes to sell to Bunker Hill, and Bunker Hill wishes to purchase
from Seller on or before the Closing Date (defined below), subject to the
prorations and adjustments set forth in this Agreement, the following items: (i)
Xxxxxxx Grande's 42% Percentage Interest (as defined in the Manager Operating
Agreement) in Manager LLC; (ii) all rights of Xxxxxxx Grande as a Member of
Manager LLC; (iii) all right, title and interest of Xxxxxxx Grande in and to
profits, losses, distributions and capital accounts in Manager LLC; (iv) any
rights of Xxxxxxx Grande in and to all cash and other property held or owned by
Manager LLC, including but not limited to, all cash reserves supporting
obligations owed to one or more Lenders (as defined below) of Property LLC
and/or Manager LLC (the rights, titles and interests referred to in clauses (i),
(ii), (iii) and (iv) are collectively referred to herein as the "MANAGER
INTERESTS"); (v) Xxxxxxx Properties' 42% Percentage Interest (as defined in the
Member Operating Agreement) in Member LLC; (vi) all rights of Xxxxxxx Properties
as a Member of Member LLC; (vii) all right, title and interest of Xxxxxxx
Properties in and to profits, losses, distributions and capital accounts in
Member LLC; and (viii) any rights of Xxxxxxx Properties in and to all cash and
other property held or owned by Member LLC, including but not limited to, all
cash reserves supporting obligations owed to one or more Lenders of Property LLC
and/or Member LLC (the rights, titles
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and interests referred to in clauses (v), (vi), (vii) and (viii) are
collectively referred to herein as the "MEMBER INTERESTS"). The Manager
Interests and the Member Interests are collectively, the "INTEREST", which
Interest constitutes all of Seller's right, title and interest in and to Manager
LLC and Member LLC and any direct or indirect interest in Property LLC.
NOW, THEREFORE, in consideration of the premises, the mutual
covenants and agreements of the parties hereinafter set forth, and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged by each party hereto, Seller and Bunker Hill hereby agree as
follows:
ARTICLE I.
DEFINITIONS
Section 1.01 CERTAIN DEFINITIONS. Unless the context otherwise
specifies or requires, the following terms shall have the meanings herein
specified throughout this Agreement.
"ADDITIONAL ALLOWANCE" As defined in Section 6.05 hereof.
"AFFILIATE" With respect to a Person, any other
Person that, directly or indirectly, owns
five (5%) percent or more of any interest
in said Person or who controls, is
controlled by or is under common control
with such Person. For the purposes of this
definition, "control" (including, with
correlative meanings, the terms "controlled
by" and "under common control with"), as
used with respect to any Person, shall mean
the possession, directly or indirectly, of
the power to direct or cause the direction
of the management and policies of such
Person, whether through the ownership of
voting securities or by contract or
otherwise.
"AGREEMENT" As defined in the preamble hereto.
"APPROVED SECURITY AGREEMENT" Collectively, a security agreement between
the borrower under the New Senior Loan and
the New Senior Lender and a security
agreement between the New Senior Lender and
Xxxxxx X. Xxxxxxx III, which together,
among other things, (i) shall ensure that
the proceeds of the New Loan Distribution
are used to repay Greenwich's repurchase
facility under the Repurchase Facility
Documents; and (ii) shall provide that such
provisions may not be amended, withdrawn or
released without Seller's prior written
consent and that Seller may enforce such
requirement for Seller's consent. All other
provisions in such security agreements
shall subject to Seller's prior review and
approval in its sole
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discretion, but solely to determine that
the agreements, as a whole, satisfy the
terms and purposes described in this
definition.
"ASSIGNMENT AND ASSUMPTION OF The document in the form of Exhibit B
MEMBERSHIP INTEREST" hereto which, among other things, will
transfer the Interest from Seller to
Purchaser.
"BUILDINGS" All of the buildings constituting the Xxxxx
Fargo office tower and all other
improvements on the Real Estate owned by
Property LLC.
"BUNKER HILL" As defined in the preamble hereto.
"BUSINESS DAY" Any day other than a Saturday, Sunday or
any holiday observed by the United States
Postal Service.
"CASH RESERVES" All cash, securities and cash equivalents
held in the accounts of all of the LLCs
as of the Closing Date, including, but
not by way of limitation, all reserves
collectively held by all of the LLCs for
the benefit of any Lender as of the
Closing Date, but not including: (i) the
amount of any tenant security deposits
actually held by the LLCs in a segregated
deposit account as of the Closing Date
pursuant to any Space Leases which have
not been applied to rent or other tenant
obligations under the Space Leases, (ii)
the proceeds of insurance, but only to
the extent required to be used for
restoration of any insured loss, as
determined by the Management Committee of
Manager LLC, or (iii) the amount
determined under Section 4.04 hereof, all
subject to the adjustments set forth in
Article IV.
"CLOSING" The transfer of the Interest from Seller to
Purchaser and the payment of the Purchase
Price by Purchaser to Seller in accordance
with this Agreement.
"CLOSING DATE" The date on which the Closing shall
occur, which shall be June 15, 2003
(subject to extension pursuant to Section
6.01).
"CODE" Collectively, the Internal Revenue Code of
1986, as amended from time to time, and the
Regulations issued thereunder from time to
time.
"XXXXXXX GRANDE" As defined in the preamble to this Agreement.
"XXXXXXX PROPERTIES" As defined in the preamble to this Agreement.
"XXXXXXX PROPERTIES GUARANTY" As defined in Section 5.01.01 hereof.
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"DEPOSIT" As defined in Section 2.02 hereof.
"DEVELOPMENT" As defined in Section 6.05 hereof.
"EARTHQUAKE DEDUCTIBLE As defined in Section 5.01.01 hereof.
GUARANTY"
"ESCROW" The escrow pertaining to this transaction
established with Escrow Agent.
"ESCROW AGENT" As defined in Section 2.02 hereof.
"ESCROW AGREEMENT" As defined in Section 2.02 hereof.
"GD&C" Xxxxxx, Xxxx & Xxxxxxxx, LLP.
"GD&C LEASE AMENDMENT" As defined in Section 6.05 hereof.
"GOVERNMENTAL AUTHORITY" The United States, the States (including
Commonwealths) thereof, political
subdivisions of each of them (including
counties and townships) and each agency,
department, commission, bureau, board and
instrumentality of each of them.
"GREENWICH" Greenwich Capital Financial Products,
Inc., a Delaware corporation, or an
Affiliate thereof.
"GUARANTIES" As defined in Subsection 5.01.01 hereof.
"INDEMNITOR" Manager LLC and Member LLC, jointly and
severally, or the successor entity of a
merger or consolidation of such entities.
"INDEMNITY" As defined in Subsection 5.01.02 hereof.
"INTEREST" As defined in the Recitals hereof.
"LENDER(S)" Any lender, or its successors and
assigns, to any of Property LLC, Member
LLC, and/or Manager LLC in connection with
any outstanding financing of the Real
Estate and/or the LLCs and any rating
agencies rating the securities with respect
thereto.
"LIENS" Liens, security interests, claims, pledges,
options, rights of first refusal or other
encumbrances of any kind whatsoever other
than those encumbering the Real Estate.
"LLC AMENDMENTS" As defined in Section 6.09.
"LLCS" Collectively, Property LLC, Manager LLC
and Member LLC.
"MANAGER INTERESTS" As defined in the Recitals hereof.
"MANAGER LLC" As defined in the Recitals hereof.
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"MANAGER OPERATING AGREEMENT" As defined in the Recitals hereof.
"MEMBER" Any member of Manager LLC or Member LLC.
"MEMBER INTERESTS" As defined in the Recitals hereof.
"MEMBER LLC" As defined in the Recitals hereof.
"MEMBER OPERATING AGREEMENT" As defined in the Recitals hereof.
"NEW LOAN DISTRIBUTION" As defined in Section 6.09 hereof.
"NEW SENIOR LENDER" The lender under the New Senior Loan.
"NEW SENIOR LOAN" As defined in Section 6.09 hereof.
"OPERATING PARTNERSHIP" Xxxxxxx Properties, L.P., a Maryland
limited partnership, or such other
Affiliate of Bunker Hill which intends to
conduct a public offering as a real estate
investment trust and own, directly or
indirectly, the Property upon Closing.
"PERSON" Any natural person, partnership,
corporation, limited liability company and
any other form of business or legal entity.
"PROPERTY" Collectively, the Real Estate, Buildings,
Space Leases, Service Contracts and Trade
Names.
"PROPERTY LLC" As defined in the Recitals hereof.
"PURCHASE PRICE" As defined in Section 2.01 hereof.
"PURCHASER" Bunker Hill or the Person designated by
Bunker Hill to purchase the Interest.
"REAL ESTATE" The fee simple interest of Property LLC
in the real estate described in Exhibit A
annexed hereto, together with all buildings
and improvements situated thereon, all
easements, rights, privileges and
appurtenances belonging thereto, including,
among other things, the Buildings, and
subject to all matters and defects of title
now existing and hereafter created.
"RELEASE OF GUARANTIES" As defined in Subsection 5.01.01.
"REPURCHASE FACILITY" The repurchase facility under the
Repurchase Facility Documents.
"REPURCHASE FACILITY The documents entered into between Bunker
DOCUMENTS" Hill and Greenwich on or about February
4, 2003 in connection with the repurchase
facility provided by Greenwich.
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"SELLER" As defined in the preamble hereto.
"SENIOR LOAN NET PROCEEDS" As defined in Section 6.09.
"SERVICE CONTRACTS" Collectively, all service contracts,
maintenance agreements, equipment leases
and other contracts and agreements
providing for the furnishing of goods,
equipment and services in connection with
the maintenance and operation of the Real
Estate in the ordinary course of business.
"SOLANA LANDLORD" Xxxxxxx Partners - Solana Limited
Partnership, a Texas limited partnership,
or its Affiliate.
"SOLANA LEASE" As defined in Section 2.01.
"SOLANA RENT REDUCTION" An amount equal to the monthly payment
which would amortize a loan of Three
Million Dollars ($3,000,000) in equal
monthly payments over a term of seven (7)
years with an interest rate equal to the
closing yield on seven year U.S. Treasuries
as published in the Wall Street Journal on
the Business Day immediately prior to the
commencement term of the Solana Lease. If
no seven year rate is published on such
date, then the seven year rate shall be
interpolated based upon the two closest
years published.
"SPACE LEASE(S)" All leases, subleases, licenses, tenancy
or occupancy agreements and operating
agreements with tenants and occupants
occupying space on the Real Estate and
all amendments, modifications and
supplements thereto, including, without
limitation, all security deposits and
advance payments of rents and other
charges held by Property LLC in
connection with said leases and other
agreements.
"SURVIVAL PROVISIONS" As defined in Section 3.04 hereof.
"SUPPLEMENTAL NORTH TOWER An amount equal to the monthly payment
RENT CREDIT" which would amortize a loan of One
Million Five Hundred Thousand Dollars
($1,500,000) in equal monthly payments over
a term of four (4) years with an interest
rate equal to the closing yield on four
year U.S. Treasuries as published in the
Wall Street Journal on the Business Day
immediately prior to the Closing Date. If
no four year rate is published on such
date, then the four year rate shall be
interpolated based upon the two closest
years published.
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"TENANT IMPROVEMENT WORK" Work performed or to be performed to
improve space occupied or intended to be
occupied by one or more tenants of the
Buildings and ordinarily treated in the
real estate industry as a capital
expenditure for accounting purposes.
"TRADE NAMES" All trade names, logos, marks,
trademarks, service marks, symbols and
items of identification relative to the
Real Estate owned by Property LLC,
specifically excluding the name "Xxxxx
Fargo" and Xxxxx Fargo Bank's other trade
names, logos, marks, trademarks, service
marks, symbols and items of
identification.
"UNDERWRITING AGREEMENT" As defined in Section 6.09 hereof.
"XXXXX FARGO BANK" Xxxxx Fargo Bank, National Association.
"XXXXX FARGO LEASE" As defined in Section 5.01.03 hereof.
"WIRE TRANSFER ACCOUNT NUMBER" As defined in the Escrow Agreement.
Section 1.02 ADDITIONAL DEFINITIONS. All terms of this Agreement
which are not defined in Section 1.01 shall have the meanings set forth in this
Agreement.
Section 1.03 CAPTIONS. Captions and other headings of this Agreement
are for convenience of reference only and in no way define, limit, prescribe,
expand or otherwise alter the scope or intent of this Agreement or in any way
affect this Agreement or any provision hereof.
Section 1.04 INTERPRETATION. Words in the singular shall be held to
include the plural and vice versa. Words of one gender shall be held to include
the other genders as the context requires. The terms "hereof," "herein" and
"herewith" and words of similar import shall be construed to refer to this
Agreement in its entirety and not to any particular provision unless otherwise
stated.
Section 1.05 CONSTRUCTION. This Agreement shall be construed without
regard to any presumption or rule requiring construction against the party
drafting or causing any instrument to be drafted.
Section 1.06 GOVERNING JURISDICTION. This Agreement shall be
construed and enforced in accordance with and governed by the laws of the State
of California.
ARTICLE II.
SALE AND PURCHASE OF THE INTEREST; PURCHASE PRICE
Section 2.01 SALE AND PURCHASE OF THE INTEREST. Xxxxxxx Grande shall
sell and convey the Manager Interest to Purchaser, Xxxxxxx Properties shall sell
and convey the Member Interest to Purchaser and Purchaser shall acquire the
Interest on the Closing Date, subject to the terms and conditions set forth in
this Agreement. The purchase price ("PURCHASE PRICE") to be
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paid for the Interest by Purchaser in cash at Closing, subject to the
adjustments and prorations set forth in this Agreement, is Seventy-Six Million
Dollars ($76,000,000.00) (inclusive of the sum of Two Million Dollars
($2,000,000.00) payable to Xxxxxxx Properties on the Closing Date as a
commission for the consummation of this transaction. If by June 15, 2003 (or
such later date to which Seller in its discretion extends such deadline, but not
beyond the Closing Date, as may be extended) the parties' respective Affiliates
execute a binding lease amendment which extends, for a period of not less than
seven (7) years, that certain office lease ("SOLANA LEASE") dated October 11,
1995 between Xxxxxxx Partners -Solana Limited Partnership and an affiliate of
Seller relating to certain office space located in the Nine Village Circle
office building at the Solana Project in Westlake, Texas, then, either the
Purchase Price shall be increased by the sum of Three Million Dollars
($3,000,000) (in addition to such other adjustments or prorations are provided
under this Agreement) or, if the Closing Date has not occurred by June 30, 2003,
for any reason whatsoever, in lieu of such Purchase Price increase, the tenant
under the Solana Lease shall be entitled to a reduction in rent equal to the
Solana Rent Reduction during the seven (7) years of the extension term of the
Solana Lease. Such Purchase Price increase or rent reduction is given in
consideration of the parties' respective Affiliates execution of such binding
lease amendment by such date. The Solana Landlord shall have the right to fully
satisfy the Solana Rent Reduction any time prior to September 1, 2003, by
payment to the tenant under the Solana Lease of the sum of Three Million Dollars
($3,000,000). The provisions concerning the Solana Rent Reduction set forth in
this Section 2.01 shall be reflected in the binding lease amendment to the
Solana Lease. The foregoing Purchase Price assumes that no distributions shall
be made by any of the LLCs pending Closing. The Purchase Price shall not be
reduced if forty-two percent (42%) of the Cash Reserves is less than Two Million
Five Hundred Twenty Thousand Dollars ($2,520,000.00). The Interest shall be
transferred free and clear of all Liens.
Section 2.02 DEPOSIT. Within three (3) Business Days of the
execution of this Agreement, Purchaser shall deposit with First American Title
Insurance Company at 000 X. Xxxxxxx Xxxxxx, Xxxxxxxx, XX 00000, Attention:
Xxxxxxx Xxxx (the "ESCROW AGENT") a deposit in the amount of Two Hundred Fifty
Thousand Dollars ($250,000.00) (the "DEPOSIT")(which shall be held pursuant to
an escrow agreement (the "ESCROW AGREEMENT") of even date herewith among Seller,
Purchaser and Escrow Agent) to be deposited and invested by Escrow Agent either
in an interest bearing account at a bank or in a federally issued or insured
interest bearing instrument. At the Closing, Escrow Agent shall release the
Deposit, plus all interest earned thereon, to Purchaser, as it directs, and the
Purchase Price shall not be adjusted by such sum. If the Closing shall not occur
by the Closing Date, for any reason or for no reason, then, except as provided
below, Seller shall have the right to terminate this Agreement and Seller shall
be entitled to receive and keep the Deposit plus all interest earned thereon as
liquidated damages pursuant to Section 7.02 for Purchaser's default, and, if
applicable, Seller shall be entitled such other remedies as are provided in
Section 7.03. As an exception to the preceding sentence if (a) Purchaser has
performed all of its material obligations to be performed prior to the Closing
hereunder and tendered the Purchase Price to Escrow Agent and (i) Seller shall
have failed to close in breach of this Agreement, or (ii) Seller is otherwise in
material breach of this Agreement (including by reason of the failure of
Seller's representations and warranties in Section 3.01 and Section 3.02 to be
true and correct as of the Closing Date), then if Purchaser elects not to waive
such defaults, Purchaser shall have the right, by notice to Seller, to terminate
this Agreement and receive a refund of the Deposit plus all interest earned
thereon and to exercise the remedies provided under Section 7.01, or (b) the
condition of title to the Interest as of the Closing Date is
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not as set forth in Section 3.01.01 and Section 3.02.01, then if Purchaser
elects not to waive such defect in title, Purchaser shall have the right, by
notice to Seller, to terminate this Agreement and receive a refund of the
Deposit plus all interest earned thereon and to exercise the remedies provided
under Section 7.01, or (c) if the consents required under Section 5.02.06 have
not been obtained by the Closing Date, then Seller and Purchaser shall have the
right, by notice to the other party, to terminate this Agreement and Purchaser
shall receive a refund of the Deposit plus all interest earned thereon.
ARTICLE III.
COVENANTS, REPRESENTATIONS AND WARRANTIES
Section 3.01 XXXXXXX GRANDE'S REPRESENTATIONS AND WARRANTIES.
Xxxxxxx Grande represents and warrants to Purchaser that, as of the date hereof
and as of the Closing Date:
3.01.01 TITLE. Xxxxxxx Grande is the sole owner of the Manager
Interest, free and clear of (a) any lien or encumbrance on, security
interest in or claim thereto, and (b) any prohibitions on transfer which
prohibit the transaction as described herein, provided the Lender and
Greenwich consents described in Section 5.02.06 and any other consents of
the other Members required under the Manager Operating Agreement are
obtained prior to Closing.
3.01.02 EXISTENCE. Xxxxxxx Grande is a corporation which is duly
formed, organized, validly existing and in good standing under the laws of
the State of California, and is authorized to conduct business in
California and has made all filings required under the laws of the State
of California.
3.01.03 AUTHORITY. Xxxxxxx Grande has full power, right and
authority to enter into this Agreement and all of the documents to be
executed and delivered by Xxxxxxx Grande hereunder.
3.01.04 AUTHORIZATION OF TRANSACTION. This Agreement and the
consummation of the transactions contemplated hereby have been duly
authorized by all necessary corporate action of Xxxxxxx Grande.
3.01.05 EFFECT OF THIS AGREEMENT. This Agreement has been duly
executed and delivered by Xxxxxxx Grande and constitutes a legal, valid
and binding obligation of Xxxxxxx Grande, enforceable against Xxxxxxx
Grande in accordance with its terms, except as such enforcement may be
limited by applicable bankruptcy, insolvency, moratorium or other similar
laws presently or hereafter in effect affecting the enforcement of
creditors' rights generally, and by general principles of equity.
3.01.06 COMPLIANCE WITH AGREEMENTS. The execution and delivery of
this Agreement, the consummation of the transactions herein contemplated
and the compliance with the terms of this Agreement will not (a) violate
any provisions of the certificate of incorporation or by-laws of Xxxxxxx
Grande, (b) assuming the consents contemplated hereunder are obtained,
violate, conflict with, or, with or without notice or the passage of time,
result in a breach of, constitute a default under or accelerate the
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performance required by, any of the terms or provisions of any instrument,
indenture, contract, agreement, franchise or permit to which Xxxxxxx
Grande is a party or by which Xxxxxxx Grande is bound, or (c) violate or
conflict with any applicable regulations of any Governmental Authority, or
any judgment, order or decree of any court having jurisdiction over
Xxxxxxx Grande or its properties. No consent, approval, order,
authorization, designation, registration, declaration or filing of, with
or by any third party or Governmental Authority is required for the
execution of this Agreement by Xxxxxxx Grande or consummation of the
transactions contemplated hereby, except any consent which may be required
from the other Members or any Lender.
3.01.07 NO PREVIOUS ASSIGNMENT. Xxxxxxx Grande has not previously
assigned or pledged or conveyed the Manager Interest or any right, title
or interest therein to any Person.
Section 3.02 XXXXXXX PROPERTIES' REPRESENTATIONS AND WARRANTIES.
Xxxxxxx Properties represents and warrants to Purchaser that, as of the date
hereof and as of the Closing Date:
3.02.01 TITLE. Xxxxxxx Properties is the sole owner of the Member
Interest, free and clear of (a) any lien or encumbrance on, security
interest in or claim thereto, and (b) any prohibitions on transfer which
prohibit the transaction as described herein, provided the Lender and
Greenwich consents described in Section 5.02.06 and any other consents of
the other Members required under the Member Operating Agreement are
obtained prior to Closing.
3.02.02 EXISTENCE. Xxxxxxx Properties is a corporation which is duly
formed, organized, validly existing and in good standing under the laws of
the State of California, and is authorized to conduct business in
California and has made all filings required under the laws of the State
of California.
3.02.03 AUTHORITY. Xxxxxxx Properties has full power, right and
authority to enter into this Agreement and all of the documents to be
executed and delivered by Xxxxxxx Properties hereunder.
3.02.04 AUTHORIZATION OF TRANSACTION. This Agreement and the
consummation of the transactions contemplated hereby have been duly
authorized by all necessary corporate action of Xxxxxxx Properties.
3.02.05 EFFECT OF THIS AGREEMENT. This Agreement has been duly
executed and delivered by Xxxxxxx Properties and constitutes a legal,
valid and binding obligation of Xxxxxxx Properties, enforceable against
Xxxxxxx Properties in accordance with its terms, except as such
enforcement may be limited by applicable bankruptcy, insolvency,
moratorium or other similar laws presently or hereafter in effect
affecting the enforcement of creditors' rights generally, and by general
principles of equity.
3.02.06 COMPLIANCE WITH AGREEMENTS. The execution and delivery of
this Agreement, the consummation of the transactions herein contemplated
and the compliance with the terms of this Agreement will not (a) violate
any provisions of the
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certificate of incorporation or by-laws of Xxxxxxx Properties, (b)
assuming the consents contemplated hereunder are obtained, violate,
conflict with, or, with or without notice or the passage of time, result
in a breach of, constitute a default under or accelerate the performance
required by, any of the terms or provisions of any instrument, indenture,
contract, agreement, franchise or permit to which Xxxxxxx Properties is a
party or by which Xxxxxxx Properties is bound, or (c) violate or conflict
with any applicable regulations of any Governmental Authority, or any
judgment, order or decree of any court having jurisdiction over Xxxxxxx
Properties or its properties. No consent, approval, order, authorization,
designation, registration, declaration or filing of, with or by any third
party or Governmental Authority is required for the execution of this
Agreement by Xxxxxxx Properties or consummation of the transactions
contemplated hereby, except any consent which may be required from the
other Members or any Lender.
3.02.07 NO PREVIOUS ASSIGNMENT. Xxxxxxx Properties has not
previously assigned or pledged or conveyed the Member Interest or any
right, title or interest therein to any Person.
Section 3.03 PURCHASER'S REPRESENTATIONS AND WARRANTIES. Purchaser
represents and warrants to Seller that, as of the date hereof and as of the
Closing Date:
3.03.01 EXISTENCE OF BUNKER HILL. Bunker Hill is a limited
partnership which is duly formed, organized, validly existing and in good
standing under the laws of the State of California.
3.03.02 AUTHORITY OF BUNKER HILL. Bunker Hill, and its general
partner on behalf of Bunker Hill, has full power, right and authority to
enter into this Agreement and all of the documents to be executed and
delivered by Bunker Hill hereunder.
3.03.03 AUTHORIZATION OF TRANSACTION. This Agreement and the
consummation of the transactions contemplated hereby have been duly
authorized by all necessary limited liability company action of Bunker
Hill.
3.03.04 EFFECT OF THIS AGREEMENT. This Agreement has been duly
executed and delivered by Bunker Hill and constitutes a legal, valid and
binding obligation of Bunker Hill, enforceable against Bunker Hill in
accordance with its terms, except as such enforcement may be limited by
applicable bankruptcy, insolvency, moratorium or other similar laws
presently or hereafter in effect affecting the enforcement of creditors'
rights generally and by general principles of equity.
3.03.05 COMPLIANCE WITH AGREEMENTS. The execution and delivery of
this Agreement, the consummation of the transactions herein contemplated
and the compliance with the terms of this Agreement will not (a) violate
any provisions of the limited partnership agreement of Bunker Hill, (b)
violate, conflict with, or, with or without notice or the passage of time,
result in a breach of, constitute a default under or accelerate the
performance required by, any of the terms or provisions of any instrument,
indenture, contract, agreement, franchise or permit to which Bunker Hill
is a party or by which Bunker Hill is bound, or (c) violate or conflict
with any applicable regulations of
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any Governmental Authority, or any judgment, order or decree of any court
having jurisdiction over Bunker Hill or its properties, including, without
limitation, the Property. No consent, approval, order, authorization,
designation, registration, declaration or filing of, with or by any third
party or Governmental Authority is required for the execution of this
Agreement or consummation of the transactions contemplated hereby, except
any consent which may be required from the other Members, Greenwich, or
any Lender.
Section 3.04 SURVIVAL OF COVENANTS, REPRESENTATIONS AND WARRANTIES.
3.04.01 Each Seller shall indemnify, defend and hold Purchaser free
and harmless from and against any and all loss, cost, damage, liabilities,
claims, demands, actions and judgments arising or resulting, directly or
indirectly, from any breach of or untruth contained in any of such
Seller's covenants, warranties and representations in this Agreement,
which indemnity shall survive the Closing and the delivery of the
Assignment and Assumption of Membership Interest until the twelfth (12th)
month anniversary of the Closing. Purchaser shall indemnify, defend and
hold Seller free and harmless from and against any and all loss, cost,
damage, liabilities, claims, demands, actions and judgments arising or
resulting, directly or indirectly, from any breach of or untruth contained
in any of Purchaser's covenants, warranties and representations in this
Agreement, which indemnity shall survive the Closing and the delivery of
the Assignment and Assumption of Membership Interest until the twelfth
(12th) month anniversary of the Closing.
3.04.02 All of Article III, Sections 4.01, 4.02.01, 4.03, 4.04,
4.05, 4.06 and 6.04 shall survive the Closing of this transaction until
the twelfth (12th) month anniversary of the Closing, and all of Article I,
Article VIII, and Section 3.04, 4.02.02, 4.07, 6.06 shall survive the
Closing of this transaction indefinitely. All of Article I, Article VII
and Article VIII and the covenants, representations and warranties in
Sections 2.02, 3.01, 3.02, 3.03, 3.04 and 6.04 shall survive termination
of this Agreement indefinitely. All of the Articles and Sections referred
to in this Section 3.04 are the "SURVIVAL PROVISIONS" with respect to a
Closing or a termination of this Agreement, as the case may be. In no
event shall any of the foregoing be deemed to constitute a waiver by
Seller or Purchaser of any applicable statute of limitations.
Section 3.05 PURCHASER'S INVESTIGATION. Purchaser hereby
acknowledges to Seller that (a) there are no representations or warranties of
any kind whatsoever, express or implied, made by Seller or on behalf of Seller
in this Agreement or otherwise in connection with this Agreement or the
transactions contemplated hereby, other than as set forth in the first paragraph
of the Recitals, Section 3.01, Section 3.02, Section 3.06 and Section 8.03 of
this Agreement; (b) Purchaser is as familiar with the Property as is Seller; (c)
Purchaser has or prior to Closing will have fully investigated, and has had or
prior to Closing will have had full opportunity to consult with counsel and
consultants with respect to, all matters pertaining to the Interest and the
Property; (d) Purchaser is not relying on any statement or representation of
Seller nor on any information supplied by Seller, its agents or its
representatives (other than as set forth in the first paragraph of the Recitals,
Section 3.01, Section 3.02, Section 3.06 and Section 8.03 of this Agreement);
(e) by reason of Purchaser's business and financial expertise and the business
and financial expertise of those Persons retained by Purchaser to advise
Purchaser with respect to
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Purchaser's purchase of the Interest, (i) Purchaser and its advisors have such
knowledge, sophistication and expertise in business and financial matters so as
to be capable of evaluating the merits and risks of the prospective investment
in the purchase of the Interest, (ii) Purchaser is able to bear the economic
risk of such investment in the purchase of the Interest, and (iii) at the
present time, Purchaser is able to afford a complete loss of such investment;
and (f) Purchaser is purchasing the Interest "As-Is", "Where is" and subject to
"all faults" except as otherwise expressly provided in the representations and
warranties set forth in Section 3.01, Section 3.02 and Section 8.03.
Section 3.06 SELLER'S INVESTIGATION. Seller acknowledges that Seller
is a sophisticated real estate investor and is relying upon its own analysis and
assessment, and the advice of its advisors, and not that of Bunker Hill,
Purchaser, or any Affiliate thereof, for purposes of entering into this
Agreement and consummating the transaction contemplated by this Agreement and is
not relying upon any representations or warranties of Purchaser other than those
set forth in Section 3.03 and Section 8.03.
ARTICLE IV.
PRORATIONS, POST-CLOSING ADJUSTMENTS AND TAX REPORTS
Section 4.01 CASH RESERVES. Cash Reserves shall be determined on a
cash basis as of the Closing Date, in accordance with this Article IV.
Section 4.02 RENTS.
4.02.01 PRORATION AT CLOSING. On the Closing Date, there shall be a
proration of (i) all rent, including all additional rent, percentage rent,
reimbursement of taxes and operating expenses (such as maintenance
charges, insurance premiums and the like) owed by tenants under Space
Leases (including, without limitation, Space Leases in the plaza area of
the Property) for the month in which the Closing Date occurs, plus (ii)
any parking revenue owed by tenants or third parties and all other income
payable to the LLCs for the month in which the Closing Date occurs, plus
(iii) all receivables on the books of the LLCs on the Closing Date,
whether or not in respect of rent, less (iv) any refunds or payments owed
by the LLCs to any tenants as of the Closing Date.
4.02.02 DELINQUENT RENTS. After Closing, Purchaser shall pay to
Seller forty-two percent (42%) of any rent or payment actually collected
after Closing which is applicable to any period prior to the month in
which the Closing occurs. All rent under the Space Leases collected after
Closing which is designated as to any particular period and is required
under applicable law to be applied to such period shall be applied to such
period. All other rent under Space Leases collected after Closing shall be
applied first to the month of the Closing, then to rent accruing and due
and payable after the month of Closing, then to rent accruing prior to the
month in which Closing occurs. Purchaser shall use commercially reasonable
efforts to collect rents delinquent at Closing which apply to the period
prior to month in which the Closing occurs.
Section 4.03 PRORATION OF EXPENSES. On the Closing Date, there shall
be a proration of all accrued and prepaid expenses of the LLCs which are items
of ordinary expense
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under generally accepted accounting principles (excluding any capital
expenditures, which shall be treated solely under Section 4.04). Such sums shall
be apportioned and pro rated as of the Closing Date. Expenses which by their
nature apply to certain periods of time (e.g. insurance premiums, real estate
taxes and assessments) shall be apportioned according to such periods of time.
Other expenses shall be allocated to the date on which such expense was
incurred. The parties shall endeavor in good faith prior to Closing to agree
upon a schedule of prorations in accordance with this Section 4.03.
Section 4.04 CAPITAL EXPENSES. The cost of the Tenant Improvement
Work, leasing commissions and other items of capital expenditure specifically
described in Exhibit C attached hereto shall be deducted from Cash Reserves at
Closing. No other Tenant Improvement Work, leasing commissions or other items of
capital expenditure shall be deducted from the determination of Cash Reserves or
prorated or apportioned under this Agreement except for those capital
expenditures contemplated by Section 6.05(ii) and (iii).
Section 4.05 LEASE TERMINATIONS. Any amounts collected with respect
to lease termination payments under any Space Leases (which terminates any Space
Lease prior to the stated termination date of the term of such Space Lease)
shall be apportioned and pro rated as of the Closing Date. Any such lease
termination payments received after the Closing Date shall also be apportioned
based upon the period of applicable lease term prior to and after the Closing
Date and be included with the other post-closing adjustments under Section 4.06.
Section 4.06 POST-CLOSING ADJUSTMENTS. To the extent of any error in
the calculation of any apportionments or adjustments under this Agreement, and
to the extent of any subsequent calculations with respect to the Property
required by this Article IV, including but not by way of limitation, year end
"true up" of escalations: (a) Purchaser and Seller shall correct the error
and/or adjust for the subsequent calculation or variance, (b) Purchaser and
Seller shall re-apportion or re-adjust the incorrect item promptly following the
discovery of the error or the making of the subsequent calculation or variance,
and (c) Purchaser shall make an appropriate payment to Seller or Seller shall
make an appropriate payment to Purchaser, as the case may be, outside of Escrow
based on such re-apportionment or re-adjustment, within ten (10) Business Days
of obtaining knowledge of such error or of other facts resulting in subsequent
calculations of prorations. On or before March 15, 2004, Purchaser shall prepare
a preliminary post-closing reconciliation report and statement with satisfactory
itemization and explanation. On or before April 15, 2004, Purchaser and Seller
shall agree upon a final post-closing reconciliation statement and Purchaser or
Seller, as applicable, shall make any final post-closing payment as shown on
such statement. Seller shall have the right to audit the books and records of
Purchaser, Property LLC, Manager LLC and Member LLC in connection with its
review of the post-reconciliation report proposed by Purchaser. The cost of such
audit shall be borne by Seller unless such audit reveals a discrepancy in
Seller's favor by more than $100,000 in the aggregate amount of the
post-reconciliation report proposed by Purchaser, in which case the cost of the
audit shall be borne by Purchaser. For purposes of these post-closing
adjustments, any rent or payment actually collected under the Space Leases after
Closing which is designated as to any particular period and is required under
applicable law to be applied to such period shall be applied to such period. All
other rent under Space Leases collected after Closing which is applicable to any
period prior to the month in which the Closing occurs shall be applied first to
the month of the Closing, then to rent accruing and due and payable after the
month of Closing,
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then to rent accruing prior to the month in which Closing occurs. Purchaser
shall use commercially reasonable efforts to collect rents delinquent at Closing
which apply to the period prior to month in which the Closing occurs.
Section 4.07 TAX REPORT. Purchaser shall cause each of the LLCs to
timely file a Schedule K-1 with respect to each respective LLC and all other
required federal, state and local income tax filings at or prior to March 15,
2004 with respect to the partial year from January 1, 2003 to the Closing Date
and all information necessary for Seller to finish its tax returns in respect of
the year 2003 shall be delivered by Purchaser to Seller on or before March 15,
2004 in each case on a basis consistent with prior filings and deliveries. After
Closing, Purchaser shall allow Seller and its representatives access to the
books and records of the LLCs applicable to the period prior to the Closing
during normal business hours upon not less than two (2) Business Days' prior
notice.
ARTICLE V.
CONDITIONS
Section 5.01 SELLER CONDITIONS. Seller's obligations under this
Agreement are contingent upon satisfaction or Seller's waiver of the following
conditions:
5.01.01 RELEASE OF GUARANTIES. Purchaser shall obtain a release
executed by the Lender (as to one or both of the "Guaranties" (defined
below), the "RELEASE OF GUARANTIES") of each of Seller's obligations to
each Lender under (i) the Guaranty (Earthquake Deductible) dated as of
April 30, 1998 executed by Xxxxxxx Properties, Bunker Hill and MAC-WFT,
Inc. in favor of Xxxxx Fargo Bank ("EARTHQUAKE DEDUCTIBLE GUARANTY"), and
(ii) the Guaranty dated as of April 30, 1998 executed by Xxxxxxx
Properties in favor of Xxxxx Fargo Bank ("XXXXXXX PROPERTIES GUARANTY")
(the Earthquake Guaranty and Xxxxxxx Properties Guaranty collectively
referred to herein as "GUARANTIES") in form acceptable to Seller. If the
Release of Guaranties is not delivered on or before the Closing Date,
Seller shall have the right to terminate this Agreement by giving written
notice of termination to Purchaser on the Closing Date in which case
Purchaser shall receive a refund of the Deposit and all interest earned
thereon. Seller will, to the extent reasonably practicable, assist
Purchaser in seeking to obtain the Release of Guaranties so long as Seller
is not required to make any payments to the Lender or incur any material
costs or additional liability in connection with obtaining such Release of
Guaranties. Seller agrees that if the outstanding financing as to which
the Guaranties were made is fully defeased on or before the Closing Date,
and Indemnitor shall indemnify Seller for all loss, claims and liabilities
under the Guaranties pursuant to an indemnification agreement in form and
substance satisfactory to Seller (which shall include a provision
prohibiting Indemnitor from transferring any of the membership interests
of Property LLC, and from Property LLC from transferring the Property, for
a period of twelve (12) months following the Closing) then the Release of
Guaranties shall be deemed to be obtained in satisfaction of this Section
5.01.01.
5.01.02 INDEMNITY. The delivery by Indemnitor to Seller of the
indemnity (the "INDEMNITY") in the form of Exhibit D hereto.
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5.01.03 XXXXX FARGO LEASE AMENDMENT. The delivery to Seller of an
Amendment to Lease ("AMENDMENT TO LEASE") in the form of Exhibit E,
amending that certain Office Lease dated May 22, 1980 by and between Xxxxx
Fargo Bank, as tenant and Property LLC, as successor-in-interest to
Xxxxxxx Partners-Xxxxxxx Properties Phase I, a California limited
partnership ("XXXXX FARGO LEASE"), including to, among other things,
convert the "Xxxxx Fargo Rent Credit" (as defined in the Manager Operating
Agreement and Member Operating Agreement) being transferred as part of the
Interest under this Agreement into a rent credit under the Xxxxx Fargo
Lease.
5.01.04 SENIOR MANAGEMENT APPROVAL. On or before the date five (5)
Business Days following the date of execution of this Agreement, Seller
shall have obtained the approval of the transactions contemplated by this
Agreement by Seller's senior management and the management committee of
the board of Xxxxx Fargo & Co.
5.01.05 PURCHASER DELIVERIES. On or before Closing, Purchaser shall
have delivered to Escrow Agent all of the items required to be delivered
to Seller pursuant to the terms of this Agreement, including but not
limited to, those provided for Purchaser to deliver in Section 6.02 and
6.03.
5.01.06 PURCHASER REPRESENTATIONS. All of the representations and
warranties of Purchaser contained in this Agreement shall be true and
correct in all material respects as of the Closing Date.
5.01.07 PURCHASER PERFORMANCE. Purchaser shall have performed and
observed, in all material respects, all covenants and agreements of this
Agreement to be performed and observed by Purchaser as of the Closing
Date.
Section 5.02 PURCHASER CONDITIONS. Purchaser's obligations under
this Agreement are contingent upon satisfaction of the following conditions:
5.02.01 SELLER DELIVERIES. Seller shall have delivered to Escrow
Agent all of the items required to be delivered to Purchaser pursuant to
the terms of this Agreement, including but not limited to, those provided
for Seller to deliver in Section 6.03.
5.02.02 SELLER REPRESENTATIONS. All of the representations and
warranties of Seller contained in this Agreement shall be true and correct
in all material respects as of the Closing Date.
5.02.03 UCC SEARCHES. At or before the Closing, Purchaser shall have
received results of the searches of the Uniform Commercial Code records in
the State of California which searches shall show that there are no Liens
affecting the Interest.
5.02.04 SELLER PERFORMANCE. Seller shall have performed and
observed, in all material respects, all covenants of this Agreement to be
performed and observed by Seller as of the Closing Date.
5.02.05 PROPERTY CONDITION. On the Closing Date, there shall not be
any adverse change in the physical condition of the Property which would
require more than
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Two Million Dollars ($2,000,000) in excess of any applicable insurance
proceeds to repair or restore.
5.02.06 GREENWICH AND LENDER CONSENTS. Seller and Purchaser shall
jointly use their commercially reasonable efforts to obtain, at
Purchaser's cost and expense, any required consents to the transactions
contemplated by this Agreement from each Lender (including any required
rating agency confirmation regarding this transaction). Purchaser will
seek any required consents from Greenwich (to the extent required by the
Repurchase Facility Documents). Neither Purchaser nor its Affiliates shall
be required to provide Greenwich or any Lender with any additional
security or additional guaranties or assume any other additional
obligations or liabilities in connection with obtaining such consents.
Seller and Purchaser shall coordinate their requests for consent to the
Lenders and to Greenwich so that the parties do not present inconsistent
information or requests to the Lenders or Greenwich. If Seller and
Purchaser are unable to obtain such required consents on or before two (2)
days prior to the Closing Date, Purchaser shall have the right to
terminate this Agreement by giving written notice of termination to
Seller, and upon such termination Escrow Agent shall remit the Deposit and
all accrued interest thereon to Purchaser.
ARTICLE VI.
CLOSING
Section 6.01 TIME AND PLACE OF CLOSING. This transaction shall be
closed at the offices of Seller's counsel (or other location mutually agreed to
in writing by Seller and Purchaser) in downtown Los Angeles, California on the
Closing Date; provided, however, Purchaser shall have the right to extend the
date of the Closing Date to any date on or before June 30, 2003 by delivering
one or more written notices thereof to Seller on or before five (5) days prior
to the then effective Closing Date.
Section 6.02 TRANSFER OF FUNDS AND THE INTEREST. At Closing, (i)
Purchaser shall pay (or if Purchaser has deposited such funds with Escrow Agent,
cause Escrow Agent to pay) the Purchase Price to Seller, (ii) Purchaser shall
deposit with Escrow Agent Seller's attorneys' fees payable under Section 6.04
(including, without limitation, the outstanding attorneys' fees payable in
connection with the Repurchase Facility); (iii) Purchaser shall pay directly or
through Escrow Agent all other costs and expenses for which Purchaser is liable
under Section 6.04 which are then due and payable and (iv) Seller shall assign
and transfer the Interest to Purchaser, free and clear of all Liens by proper
instruments of assignment and transfer as hereinafter provided. Payment shall be
made by wire transfer of immediately available federal funds to the Wire
Transfer Account Number.
Section 6.03 DOCUMENTS TO BE DELIVERED AT CLOSING. At Closing:
6.03.01 Seller shall execute, acknowledge and deliver the following
instruments of assignment and transfer to Purchaser or its designee:
(a) An Assignment and Assumption of Membership Interest to Purchaser
in the form annexed hereto as Exhibit B.
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(b) An authorizing resolution of the board of directors for each of
Xxxxxxx Grande and Xxxxxxx Properties authorizing each entity to enter
into and perform its obligations under this Agreement.
(c) An affidavit by each of Xxxxxxx Grande and Xxxxxxx Properties
that it is not a foreign corporation, foreign partnership, foreign trust
or foreign estate (as those terms are defined in the Code) pursuant to
Section 1445 of the Code, and any comparable affidavit required under the
applicable law of any State.
(d) An Amendment to Lease in form annexed hereto as Exhibit E.
(e) Such certificates, authorizations and consents reasonably
requested by Purchaser which may be necessary to cause (i) a refinancing
of the Property immediately prior to Closing to effect the transactions
contemplated by this Agreement; and/or (ii) a an amendment and restatement
of the Operating Agreement of Property LLC to satisfy the single purpose
bankruptcy remote requirements of Purchaser's lenders in connection with
such financing.
6.03.02 Purchaser shall execute, acknowledge and deliver to Seller:
(a) An Assignment and Assumption of Membership Interest in the form
annexed hereto as Exhibit B.
(b) An authorizing resolution of Purchaser authorizing Purchaser to
enter into and perform its obligations under this Agreement.
(c) An Amendment to Lease in the form annexed hereto as Exhibit E.
(d) Copies of all signed Release of Guaranties to be obtained
pursuant to Section 5.01.01 (to the extent required to be obtained under
Section 5.01.01) and the signed consents required under Section 5.02.06 of
this Agreement, if any.
6.03.03 Purchaser shall cause to be delivered the Indemnity executed
by Indemnitor in the form annexed hereto as Exhibit D.
Section 6.04 EXPENSES. Purchaser shall pay all fees and expenses of
Purchaser's consultants and counsel, transfer taxes, if any, title insurance
premiums, if any, costs of title searches, costs of survey, if any, costs of UCC
searches, any loan servicer fees or rating agency fees or charges, and costs for
the preparation and negotiation of this Agreement and the consummation of the
transactions contemplated by this Agreement. Purchaser shall pay the fees and
expenses of Seller's counsel through Escrow concurrently with Closing or any
earlier termination of this Agreement up to a maximum amount of $140,000. In
addition, at Closing through the Escrow Agent, Purchaser shall pay the
outstanding invoices of Seller's counsel incurred in connection with the
Repurchase Facility.
Section 6.05 OPERATING COVENANT. Prior to Closing, Purchaser shall
cause its affiliates to continue to operate the Property and the LLCs in the
ordinary course of business consistent with past practices, subject to the
approval rights of Seller and the Management
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Committee of Manager LLC in accordance with the Manager Operating Agreement and
the Member Operating Agreement. Notwithstanding the foregoing, no obligations
for Tenant Improvement Work, leasing commissions, capital improvements or any
item of extraordinary maintenance or expense shall be paid or incurred by any of
the LLCs after May 1, 2003, until Closing or termination of this Agreement
except for (i) the Tenant Improvement Work described on Exhibit C; (ii) capital
improvements or extraordinary maintenance or expense required by applicable law
to be commenced or completed within such time period and (iii) emergency repairs
which are necessary to avoid imminent danger of injury to the Property or to any
individual. Seller hereby approves the pending Seventh Amendment to Office
Lease, dated as of April 18, 2003 between Property LLC and Xxxxxx, Xxxx &
Xxxxxxxx, LLP ("GD&C LEASE AMENDMENT") and approves the immediate execution and
delivery of such GD&C Lease Amendment by Property LLC provided that Purchaser
delivers to Seller evidence that the leasing reserves of the LLCs will have
sufficient funds added from the New Senior Loan to satisfy the landlord's tenant
improvement obligations thereunder (i.e. a schedule or provisions from the New
Senior Loan documents which show that sufficient proceeds of the New Senior Loan
have been allocated to reserves for such tenant improvement obligations). The
parties acknowledge that the GD&C Lease Amendment requires that Property LLC
advance certain capital costs as part of the lease transaction. Such capital
costs include the additional tenant improvement allowance of $1,501,738.00 which
is referred to as the "2004 Allowance" in Landlord's Improvement Letter which
constitutes part of the GD&C Lease Amendment, ("ADDITIONAL ALLOWANCE"). The
Additional Allowance is payable to GD&C on January 1, 2004. If, for any reason,
the Closing under this Agreement fails to occur, so that Seller retains its
interests in Member LLC and Manager LLC and is subject to the terms of the GD&C
Lease Amendment, Purchaser shall bear 100% of the economic cost to Property LLC
of the Additional Allowance and Seller shall bear none of the cost of the
Additional Allowance. In order to assure that Seller will not bear any portion
of the Additional Allowance, Purchaser shall cause its Affiliate, Xxxxxxx
Partners Development, Ltd. ("DEVELOPMENT"), as the Property Manager for the
Xxxxx Fargo Tower, to pay directly to Seller an amount equal to 42% of the
Additional Allowance (i.e., $630,729.96) out of the Management Fees paid to
Development from and after July 1, 2003 until Seller receives its share of the
Additional Allowance. This provision shall survive the termination of this
Agreement due to a failure of the Closing to occur, but this provision shall not
survive the Closing hereunder.
Section 6.06 RELEASE.
6.06.01 GENERAL. Subject to and effective as of Closing, Seller and
Purchaser do hereby fully and forever release, discharge and acquit each
other and each other's partners, parents, subsidiaries and affiliates, and
their respective past and present officers, directors, shareholders,
attorneys, accountants, legal representatives, agents and employees, and
their successors, heirs and assigns and each of them, of and from and
against any and all claims, demands, obligations, duties, liabilities,
damages, expenses, indebtedness, debts, breaches of contract, acts,
omissions, misfeasance, malfeasance, causes of action, sums of money,
accounts, compensation, contracts, controversies, promises, damages,
costs, losses and remedies therefor, choses in action, rights of indemnity
or liability of any type, kind, nature, description or character
whatsoever, and irrespective of how, why or by reason of what facts,
whether known or unknown, whether liquidated or unliquidated, which Seller
or Purchaser may now have or
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heretofore have had against any of said persons, firms or entities by
reason of, arising out of or based upon: (i) the Property, Manager LLC,
Member LLC or Property LLC; (ii) the released parties' acts, statements,
conduct, representations and omissions made in connection therewith; or
(iii) any fact, matter, transaction or event relating thereto, whether
known or unknown, PROVIDED, HOWEVER, that foregoing release specifically
excludes any obligations of Purchaser and Seller and their Affiliates
under this Agreement and the documents executed pursuant hereto.
6.06.02 WAIVERS. Seller and Purchaser are aware of the provisions of
Section 1542 of the California Civil Code, which Section reads as follows:
A general release does not extend to claims which the creditor
does not know or suspect to exist in his favor at the time of
executing the release, which if known by him must have materially
affected his settlement with the debtor.
Purchaser and Seller hereby waive the provisions of this statute and those
of any other applicable laws restricting the release of claims which the
releasing parties do not know or suspect to exist at the time of release,
which, if known, would have materially affected the decision to agree to
these releases. In this connection, Seller and Purchaser hereby agree,
represent and warrant to each other that it realizes and acknowledges that
factual matters now unknown may have given or may hereafter give rise to
causes of action, claims, demands, debts, controversies, damages, costs,
losses and expenses which are presently unknown, unanticipated and
unsuspected, and Seller and Purchaser agree, represent and warrant that
the releases provided herein have been negotiated and agreed upon in light
of that realization and they nevertheless hereby intend to release,
discharge and acquit the parties set forth hereinabove from any such
unknown causes of action, claims, demands, debts, controversies, damages,
costs, losses and expenses.
6.06.03 NO REPRESENTATIONS. Purchaser and Seller hereby acknowledge
that they have not relied upon any representation of any kind made by the
other in making the foregoing release except for the representations and
warranties expressly set forth in this Agreement.
6.06.04 NO ASSIGNMENT. Purchaser and Seller represent and warrant to
each other that it has not heretofore assigned or transferred, or
purported to assign or to transfer, to any person or entity any matter
released by such party hereunder or any portion thereof or interest
therein, and Purchaser and Seller agree to indemnify, protect, defend and
hold each other harmless from and against any and all claims based on or
arising out of any such assignment or transfer or purported assignment or
transfer by such party.
6.06.05 NO ADMISSIONS. It is hereby further understood and agreed
that the acceptance of delivery of this release shall not be deemed or
construed as an admission of liability of any nature whatsoever arising
from or related to the subject of the within release.
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Section 6.07 DISTRIBUTION. Concurrently with the Closing, Property
LLC, Manager LLC and Member LLC shall distribute to Xxxxxxx Grande, Xxxxxxx
Properties and Bunker Hill in accordance with the terms of the operating
agreement of Property LLC, the Manager Operating Agreement and the Member
Operating Agreement all Cash Reserves, if any, in excess of Six Million Dollars
($6,000,000.00). For purposes of that distribution, any unpaid "Xxxxx Fargo Rent
Credit" (as defined in the Manager Operating Agreement and Member Operating
Agreement) shall be apportioned on an accrual basis and pro-rated as of the
Closing Date.
Section 6.08 SELLER INDEMNITY. Effective upon Closing, each Seller
does hereby indemnify, protect and save Purchaser harmless against and from any
and all damages, losses, liabilities, claims, demands, injuries, deficiencies,
judgments, suits, proceedings, and costs or expenses arising therefrom
(including, without limitation, reasonable attorneys' fees and disbursements of
attorneys that are selected by Purchaser in its sole discretion) of any kind or
of any nature whatsoever which may be imposed upon, incurred by or awarded
against Purchaser and arising at any time out of, as a result of, in connection
with, or with respect to any contracts, agreements or other obligations binding
upon any of the LLCs entered into by such Seller on behalf of any of the LLCs
without due authorization or authority granted under the Member Operating
Agreement, the Manager Operating Agreement or the Management Committee of
Manager LLC.
Section 6.09 NEW SENIOR LOAN CLOSING. Provided that Seller has
received a letter from underwriter's counsel confirming that, as of the date not
more than one day prior to the scheduled closing of the initial public offering
of the common stock of Xxxxxxx Properties, Inc., an underwriting agreement has
been fully executed relating to such initial public offering (the "UNDERWRITING
AGREEMENT"), the "pricing" of the common stock for Xxxxxxx Properties, Inc. has
occurred, and to such counsel's knowledge, the underwriters have not exercised
any "market-out" under the Underwriting Agreement, and provided that (i) an
Approved Security Agreement has been executed and delivered to Seller; (ii)
Bunker Hill has executed and sent to Seller the amendments to the Member
Operating Agreement and the Manager Operating Agreement in the forms of Exhibit
F-1 and Exhibit F-2 attached hereto (collectively, the "LLC AMENDMENTS"), which
LLC Amendments shall be deemed delivered upon satisfaction of the Repurchase
Facility as provided herein; (iii) Bunker Hill delivers to Seller evidence that
Senior Loan Net Proceeds will be immediately and automatically distributed by
Property LLC to Xxxxxx X. Xxxxxxx III through the chain of Xxxxxxx entities upon
the disbursement of the New Senior Loan and defeasance of the existing project
loan, establishment of new loan reserves, and payment of closing costs and fees,
and (iv) Bunker Hill has delivered to Seller a schedule showing the proposed
uses of the proceeds of the New Senior Loan are limited to the uses described in
Paragraph 3(c) of each of the LLC Agreements, then Seller hereby consents and
agrees that prior to (but in no event more than one day prior to the anticipated
Closing under this Agreement), Bunker Hill shall have the authority in the name
and on behalf of the LLCs (without need for further approval from Seller) to
cause (a) the closing of a new senior project loan secured by the Property (the
"NEW SENIOR LOAN"), (b) the defeasance of the existing project loan on the
Property, (c) notwithstanding the terms of the operating agreement of Property
LLC, the Manager Operating Agreement and the Member Operating Agreement to the
contrary, the retention of net proceeds of such New Senior Loan (after
defeasance of the existing project loan, establishment of new loan reserves, and
payment of closing costs and fees) (the "SENIOR LOAN
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NET PROCEEDS") in an account for the benefit of the Property LLC, Manager LLC
and Member LLC (or their successors in interest) or the distribution (the "NEW
LOAN DISTRIBUTION") of some or all of such proceeds into an account in the name
of Xxxxxx X. Xxxxxxx III (which account may be subject to a security interest in
favor of the lender of the New Senior Loan or its affiliate and include
conditions to the release of funds to Xxxxxx X. Xxxxxxx III based on
consummation of the initial public offering of the common stock for Xxxxxxx
Properties, Inc.), in either case as elected by Bunker Hill, and (d) the
consummation of such other transactions necessary or desirable to close the New
Senior Loan, defease the existing project loan, and make the New Loan
Distribution, provided that in no event shall any such transactions require
Seller or any Affiliate thereof to assume any personal liabilities or make any
direct commitments to the lender of the New Senior Loan (or otherwise) or in any
way otherwise impair the rights or release any obligations of Purchaser and
Seller under this Agreement. The Senior Loan Net Proceeds shall not be included
or taken into consideration for purposes of computing the Purchase Price payable
to Seller under this Agreement, including without limitation, for purposes of
determining the distributions to be made under Section 6.07 hereunder. If the
New Senior Loan is obtained, Bunker Hill covenants with Seller to satisfy the
Repurchase Facility. Seller hereby consents to the use of New Senior Loan
proceeds to satisfy the Repurchase Facility in accordance with this Section
6.09.
ARTICLE VII.
REMEDIES
Section 7.01 REMEDIES OF PURCHASER. If all of the requirements and
conditions precedent to Seller's and Purchaser's obligations hereunder have been
satisfied or waived in writing by Seller, in the case of requirements and
conditions precedent to Seller's obligations, and by Purchaser, in the case of
requirements and conditions precedent to Purchaser's obligations, and Seller
shall thereafter fail or refuse to sell the Interest to Purchaser as provided
herein, Purchaser may elect only one of the following two remedies, either (a)
to terminate this Agreement and receive the Deposit and all accrued interest
thereon from Escrow Agent, in which case Buyer's and Seller's positions in the
LLCs shall remain as existing under the Manager Operating Agreement, the Member
Operating Agreement and the Operating Agreement of Property LLC, which
agreements shall remain in full force and effect or (b) to enforce Seller's
obligations hereunder by specific performance and to recover all costs of
enforcement thereof. In no event shall Seller be subject to any form of monetary
damages, including, without limitation, actual (other than any amounts payable
or reimbursable under Section 8.13 below), consequential or punitive damages.
Section 7.02 REMEDIES OF SELLER. IF ALL OF THE REQUIREMENTS AND
CONDITIONS PRECEDENT TO SELLER'S AND PURCHASER'S OBLIGATIONS HEREUNDER HAVE BEEN
SATISFIED OR WAIVED IN WRITING BY SELLER, IN THE CASE OF REQUIREMENTS AND
CONDITIONS PRECEDENT TO SELLER'S OBLIGATIONS, AND BY PURCHASER, IN THE CASE OF
REQUIREMENTS AND CONDITIONS PRECEDENT TO PURCHASER'S OBLIGATIONS, AND PURCHASER
SHALL THEREAFTER FAIL OR REFUSE TO PURCHASE THE INTEREST FROM SELLER AS PROVIDED
HEREIN, SELLER'S SOLE AND EXCLUSIVE REMEDY SUBJECT TO SECTION 7.03 BELOW, SHALL
BE TO TERMINATE THIS AGREEMENT AND RECEIVE THE DEPOSIT AND ACCRUED INTEREST
THEREON FROM ESCROW
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AGENT, WHICH AMOUNT SHALL CONSTITUTE LIQUIDATED DAMAGES TO SELLER FOR
PURCHASER'S FAILURE OR REFUSAL TO PURCHASE THE INTEREST AS PROVIDED HEREIN. THE
PARTIES STIPULATE THAT THE AMOUNT OF ACTUAL DAMAGES, IF ANY, THAT SELLER WOULD
INCUR AS A RESULT OF PURCHASER'S FAILURE OR REFUSAL TO PURCHASE THE INTEREST AS
PROVIDED HEREIN ARE DIFFICULT IF NOT IMPOSSIBLE TO DETERMINE AND THAT SUCH
LIQUIDATED DAMAGE AMOUNT CONSTITUTES A FAIR AND REASONABLE ESTIMATE OF SELLER'S
DAMAGES AND WHICH THE PARTIES HAVE NEGOTIATED ON AN ARM'S-LENGTH BASIS AS THE
SELLER'S EXCLUSIVE REMEDY FOR PURCHASER'S FAILURE OR REFUSAL TO PURCHASE THE
INTEREST AS PROVIDED HEREIN. PURCHASER AND SELLER AGREE THAT THE PROVISIONS OF
THIS SECTION 7.02 ARE REASONABLE IN LIGHT OF THE CIRCUMSTANCES EXISTING AT THE
TIME WHEN THIS AGREEMENT WAS MADE.
/s/ RFM /s/ MI
----------------------------- ---------------------------------
PURCHASER'S INITIALS SELLER'S INITIALS
Section 7.03 FAILURE TO CLOSE. In addition to any remedy which may
be available to Seller under Section 7.02, in the event the Closing does not
occur by the Closing Date for any reason other than Seller's breach of this
Agreement: (i) Buyer's and Seller's positions in the LLCs shall remain as
existing under the Manager Operating Agreement, the Member Operating Agreement
and the Operating Agreement of Property LLC, which agreements shall remain in
full force and effect (subject to the LLC Amendments if the New Senior Loan is
obtained under Section 6.09) and (ii) Xxxxx Fargo Bank shall be entitled to the
Supplemental North Tower Rent Credit, which may be offset by Xxxxx Fargo under
the Xxxxx Fargo Lease for each of forty-eight (48) months following the Closing
Date commencing August 1, 2003. In addition, in order to assure Seller and Xxxxx
Fargo Bank the full benefit of the Supplemental North Tower Rent Credit,
Purchaser shall cause Development to pay directly to Seller an amount equal to
42% of the Supplemental North Tower Rent Credit out of the Management Fees paid
to Development from and after August 1, 2003, while the Supplemental North Tower
Rent Credit is in effect. Bunker Hill shall have the right to fully satisfy the
Supplemental North Tower Rent Credit at any time prior to August 1, 2003, by the
payment by Bunker Hill of $1,500,000 to Xxxxx Fargo Bank. Property LLC, as
landlord under the Xxxxx Fargo Lease, shall evidence its agreement to the
provisions of this Section 7.03 in a rider to this Agreement.
ARTICLE VIII.
MISCELLANEOUS
Section 8.01 NOTICES. Any and all notices or other communications or
deliveries to be given or made with respect to this Agreement shall be deemed to
have been duly given or made for all purposes if sent by reputable overnight
courier service for next day delivery or hand delivered, as follows:
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If to Seller: Xxxxxxx Grande, Inc.
c/o Wells Fargo Bank, N.A.
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxx X. Xxxxxx, Senior Vice President
E-mail: xxxxxxx@xxxxxxxxxx.xxx
With copies to: Xxxxxxx Grande, Inc.
c/x Xxxxx Fargo Bank, N.A.
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxxxx Xxxxx-Xxxxxx
E-mail: xxxxxxx@xxxxxxxxxx.xxx
And: Xxxxx Xxxxxxxxxx LLP
000 X. Xxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxx X. Xxxxxx
E-mail: xxxxxxx@xxxxxxxxxxxxxxx.xxx
provided that each of Seller and Xxxxx Xxxxxxxxxx LLP, respectively, may
from time to time specify a different address by notice given in
accordance with this Section.
If to Purchaser: Xxxxxxx Partners
000 Xxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxx III and
Xxxx X. Lammas
E-mail: Xxxxxx.Xxxxxxx@xxxxxxxxxxxxxxx.xxx and
Xxxx.Xxxxxx@xxxxxxxxxxxxxxx.xxx
With copies to: Xxxxxxxxx & Xxxxxx Professional Corporation
0000 Xxxxx Xxxxxx, Xxxxx 000
Xxxxx Xxxxxx, Xxxxxxxxxx 00000
Attn: Xxxx X. Xxxxxx, Esq.
E-Mail: xxxxxxx@xxxxxxxxx.xxx
provided that each of the Purchaser and Xxxxxxxxx & Xxxxxx PC,
respectively, may from time to time specify a different address by notice
given in accordance with this Section.
The date upon which any such notice shall be deemed given and received shall be:
(i) if hand delivered, on the date of personal presentation; or (ii) if sent by
reputable overnight courier service for next day delivery, one (1) Business Day
following the delivery of such notice to such courier during normal business
hours. Purchaser and Seller shall utilize reasonable efforts to
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communicate the contents of any notice given by such Person by telephone or
e-mail contact on the day of the delivery of such notice to the courier service
(the failure to make telephone notice or e-mail notice shall not impair the
effectiveness of the courier service notice for the purpose of this Agreement).
Section 8.02 NO WAIVER. No delay, forbearance or neglect by
Purchaser or Seller in the enforcement of any of the conditions of this
Agreement or any of Purchaser's or Seller's rights or remedies hereunder shall
constitute or be construed as a waiver thereof. No waiver of any provision
hereof, or any consent required hereunder or any consent to any departure from
this Agreement, shall be effective unless expressly and affirmatively made in
writing signed by or on behalf of the party to be charged with such waiver. No
waiver shall be deemed a continuing waiver or waiver in respect of any
subsequent breach or default, either of similar or different nature, unless
expressly so stated in such writing.
Section 8.03 BROKERAGE COMMISSIONS. Each of Seller and Purchaser
represents and warrants to the other that it has not dealt with any broker or
finder in connection with the transaction embodied by this Agreement, there are
no commissions due in connection with the transactions contemplated by this
Agreement (except that the parties acknowledge that the Purchase Price includes
a $2,000,000 commission being paid to Xxxxxxx Properties upon the Closing of the
transactions described herein) and it has not employed and is obligated to any
real estate agent or broker or other broker or finder in connection with such
transaction, and Seller and Purchaser shall each indemnify the other from and
against any and all claims and liabilities arising from a breach of the
representations and warranties made in this Section by the indemnity for any
commissions.
Section 8.04 ASSIGNMENT. This Agreement and all of the provisions
hereof shall be binding upon and inure to the benefit of the parties hereto and
their respective successors and permitted assigns. Neither this Agreement nor
any of the rights, interests or obligations hereunder shall be assigned by any
party hereto without the prior written consent of the other party; except that
Bunker Hill may assign its rights and obligations under this Agreement to the
Operating Partnership or any other Person which owns the entire fifty-eight
percent (58%) membership interests in Member LLC and Manager LLC not owned by
Seller or to any other Affiliate of Bunker Hill, but such assignment or
designation shall not release Bunker Hill of any obligations hereunder.
Section 8.05 NO THIRD PARTY BENEFICIARIES. The provisions of this
Agreement are intended to be solely for the benefit of the parties hereto, and
their respective successors and permitted assigns, and none of the provisions of
this Agreement are intended to be, nor shall they be construed to be, for the
benefit of any third person or entity.
Section 8.06 SEVERABILITY. Should any clause, section or part of
this Agreement be held or declared to be void or illegal for any reason, all
other clauses, sections or parts of this Agreement which can be effected without
such illegal clause, section or part shall nevertheless continue in full force
and effect.
Section 8.07 JURISDICTION. The parties hereto irrevocably consent to
submit to the exclusive jurisdiction of the courts of the State of California
over any suit, action or proceeding arising out of or related to this Agreement
or any other document or instrument
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executed or delivered by the parties hereto or otherwise related to this
Agreement or the transactions contemplated hereby. Notwithstanding the
foregoing, in any jurisdiction in which an action has been brought between a
non-party to this Agreement and a party hereto regarding the subject matter of
this Agreement, that party may join the other party to this Agreement as a
plaintiff or as a defendant (as the case may be) in that action, and the parties
to this Agreement may assert in that action any claims or counterclaims arising
under this Agreement that either party may have against the other party.
Section 8.08 TIME OF ESSENCE. Time shall be of the essence of this
Agreement.
Section 8.09 ENTIRE AGREEMENT. This instrument contains and
constitutes the entire agreement of Seller and Purchaser regarding the subject
matter hereof, and supersedes all prior agreements, written or oral, between the
parties regarding the subject matter hereof.
Section 8.10 AMENDMENT. Except as may be specifically provided
otherwise herein, no amendment, change, modification or addition to this
Agreement or any part hereof shall be effective unless made in writing and
signed by or on behalf of the party to be charged therewith.
Section 8.11 FURTHER ASSURANCES. Each party shall without further
consideration execute and deliver such other documents and take such other
action, whether prior or subsequent to Closing, as may be reasonably requested
by the other party to consummate more effectively the purposes or subject matter
of this Agreement. The provisions of this Section shall survive the Closing.
Section 8.12 COUNTERPARTS. This Agreement may be executed in
counterparts and all such executed counterparts shall constitute the same
agreement. It shall be necessary to account for only one such counterpart in
proving this Agreement.
Section 8.13 ATTORNEYS' FEES. In the event any dispute between
Purchaser and Seller should result in litigation, the prevailing party shall be
reimbursed for all reasonably costs incurred in connection with such litigation,
including, without limitation, reasonable attorneys' fees.
Section 8.14 CONFIDENTIALITY. The terms of this Agreement, and all
documents prepared in connection herewith shall be confidential, shall not be
disclosed (except for reasonably necessary disclosures to agents, investment
bankers, lenders, investors, representatives, lawyers and accountants, and as
required by law, including without limitation, as required by State or federal
securities laws as reasonably determined by Purchaser's lawyers), and (except
for this Agreement and any written agreement fully executed and delivered by and
between any of the parties hereto, and except for documents existing as of the
date of this Agreement which are discoverable in any litigation or other
proceeding involving Seller, on the one hand, and Purchaser, on the other hand)
may not be introduced in any such litigation or other proceeding (the same being
privileged in the same manner as a settlement offer in litigation).
Section 8.15 NO RECORDING. This Agreement, or any memorandum hereof,
shall not be recorded.
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Section 8.16 JURY TRIAL WAIVER. SELLER AND PURCHASER EACH WAIVES ALL
RIGHTS TO TRIAL BY JURY OF ANY SUITS, CLAIMS, COUNTERCLAIMS, ACTIONS OR OTHER
PROCEEDINGS OF ANY KIND ARISING UNDER OR RELATING TO THIS AGREEMENT AND THE
TRANSACTIONS CONTEMPLATED HEREBY OR IN ANY WAY CONNECTED WITH OR RELATED OR
INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO WITH RESPECT TO THIS AGREEMENT
OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN
CONNECTION HEREWITH OR THE TRANSACTIONS RELATED HERETO, IN EACH CASE WHETHER NOW
EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT OR TORT OR
OTHERWISE. SELLER AND PURCHASER EACH ACKNOWLEDGES THAT THIS IS A WAIVER OF A
LEGAL RIGHT AND REPRESENTS TO THE OTHER THAT THIS WAIVER IS MADE KNOWINGLY AND
VOLUNTARILY. SELLER AND PURCHASER EACH AGREES THAT ALL SUCH SUITS, CLAIMS,
COUNTERCLAIMS, ACTIONS OR OTHER PROCEEDINGS SHALL BE TRIED BEFORE A JUDGE OF A
COURT OF COMPETENT JURISDICTION, WITHOUT A JURY. SELLER AND PURCHASER EACH
AGREES THAT THIS SECTION CONSTITUTES WRITTEN CONSENT THAT TRIAL BY JURY SHALL BE
WAIVED IN ANY SUCH SUIT, CLAIM, COUNTERCLAIM, ACTION OR OTHER PROCEEDING AND
AGREE THAT SELLER AND PURCHASER EACH SHALL HAVE THE RIGHT AT ANY TIME TO FILE
THIS AGREEMENT WITH THE CLERK OR JUDGE OF ANY COURT IN WHICH ANY SUCH SUIT,
CLAIM, COUNTERCLAIM, ACTION OR OTHER PROCEEDING MAY BE PENDING AS STATUTORY
WRITTEN CONSENT TO WAIVER OF TRIAL BY JURY.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first above written.
SELLER: XXXXXXX GRANDE INC.,
a California corporation
By: /s/ Xxxx X. Xxxxxx
-----------------------------------
Name: Xxxx X. Xxxxxx
----------------------------
Title: Senior Vice President
----------------------------
XXXXXXX PROPERTIES INC.,
a California corporation
By: /s/ Xxxx X. Xxxxxx
-----------------------------------
Name: Xxxx X. Xxxxxx
----------------------------
Title: Senior Vice President
----------------------------
BUNKER HILL: XXXXXXX PARTNERS-BUNKER HILL, LTD.,
a California limited partnership
By: Xxxxxxx Partners BGHS, LLC,
a California limited liability
company, general partner
By: Xxxxxxx Partners SCS, Inc.,
a California corporation,
Its Manager
By:/s/ Xxxxxx X. Xxxxxxx III
---------------------------
Its:
-----------------------
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SUPPLEMENTAL NORTH TOWER RENT CREDIT RIDER
The undersigned does hereby evidence its agreement to the provisions
of Section 6.09 of the Agreement of Purchase and Sale of Membership Interests
("AGREEMENT") dated as of May 27, 2003, by and between Xxxxxxx Partners - Bunker
Hill, Ltd., a California limited partnership ("BUNKER HILL"), Xxxxxxx
Properties, Inc., a California corporation ("PROPERTIES"), and Xxxxxxx Grande,
Inc., a California corporation ("GRANDE") (all terms used in this Rider shall
have the meanings set forth in the Agreement).
In this regard, the undersigned agrees that if: (i) the purchase and
sale of the membership interests of Properties and Grande in North Tower Member,
LLC, a Delaware limited liability company, or North Tower Manager, LLC, a
Delaware limited liability company, does not occur on or before the Closing Date
(in no event later than June 30, 2003), and (ii) Bunker Hill elects to cause
Xxxxx Fargo Bank to receive the Supplemental North Tower Rent Credit under
Section 6.09 of the Agreement, then, the undersigned does hereby grant to Xxxxx
Fargo Bank the Supplemental North Tower Rent Credit, in the amount equal to the
monthly payment which would amortize a loan of One Million Five Hundred Thousand
Dollars ($1,500,000) in equal monthly payments over a term of four (4) years
with an interest rate equal to the closing yield on four year U.S. Treasuries as
published in the Wall Street Journal on the Business Day immediately prior to
the Closing Date. If no four year rate is published on such date, then the four
year rate shall be interpolated based upon the two closest years published.
Bunker Hill shall have the right to terminate the Supplemental North Tower Rent
Credit by the payment of $1,500,000 to Xxxxx Fargo Bank, N.A. any time prior to
August 1, 2003.
NORTH TOWER, LLC,
a Delaware limited liability company
By: NORTH TOWER MANAGER, LLC,
a Delaware limited liability company,
Its Managing Member
By: XXXXXXX PARTNERS-BUNKER HILL, LTD.,
a California limited partnership,
Its Administrative Member
By: XXXXXXX PARTNERS BGHS, LLC,
a California limited liability company,
Its General Partner
By: XXXXXXX PARTNERS SCS, INC.,
a California corporation,
Its Manager
By: /s/ Xxxxxx X. Xxxxxxx III
--------------------------------------
Name: Xxxxxx X. Xxxxxxx III
-------------------------------
Title:
------------------------------
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LIST OF EXHIBITS
Exhibit A Description of the Real Estate
Exhibit B Form of Assignment and Assumption of Membership Interest
Exhibit C Pro Rated Tenant and Capital Improvements and Leasing Commissions
Exhibit D Form of Indemnity
Exhibit E Form of Amendment to Lease
Exhibit F-1 Form of Amendment to Member LLC Agreement
Exhibit F-2 Form of Amendment to Manager LLC Agreement
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EXHIBIT A
DESCRIPTION OF THE REAL ESTATE
PARCEL 1:
Xxx 0 xx Xxxxx Xx. 00000, in the City of Los Angeles, County of Los Angeles,
State of California, as per map recorded in Book 912, Pages 39 to 45 inclusive
of Maps, in the office of the County Recorder of said County.
EXCEPT therefrom all public streets, highways or other public ways adjoining
said Lot 6, all right, title and interest thereto having been conveyed to the
City of Los Angeles, by the map of said Xxxxx Xx. 00000.
Together with that portion of said Lot 6, being a portion of 0xx Xxxxxx 80 feet
wide lying below an elevation of 328 feet based on national geodetic vertical
datum of 1929 per Ordinance No. 150,763 of the City of Los Angeles effective May
19, 1978 as shown on the map of Xxxxx Xx. 00000 recorded in Book 912, Pages 39
to 45 inclusive of Maps, in the office of the County Recorder of Los Angeles
County, bounded and described as follows:
Beginning at the intersection of the Northwesterly line of Xxxxx Xxxxxx 00 feet
wide as shown on said map with the Southwesterly line of 0xx Xxxxxx 80 feet wide
as shown on said map; thence Northwesterly along the certain courses in said
Southwesterly line to the Easterly terminus of that certain curve in the
Northerly corner of Lot 6, said Tract, shown as being concave Southerly and
having a radius of 20 feet; thence Northeasterly along the Northeasterly
prolongation of a radial line of said curve which passes through its Easterly
terminus to a line parallel with and distant 7 feet Northeasterly measured at
right angles from that certain course in said Southwesterly line shown on the
map of said tract as having a bearing and length of North 52(degree) 23' 13"
West 132.17 feet; thence Southeasterly along said parallel line to a line
parallel with and distant 7 feet Northeasterly measured at right angles from
that certain course in said Southwesterly line shown as having a bearing and
length of North 52(degree) 13' 12" West 162.94 feet; thence Southeasterly along
said last mentioned parallel line to the Northeasterly prolongation of said
Northwesterly line; thence Southwesterly along said last mentioned Northeasterly
prolongation to the point of beginning, as provided in the deed from the City of
Los Angeles, recorded July 7, 1980 as Instrument No. 80-647237, Official
Records.
Together with that portion of said Lot 6, being that portion of 0xx Xxxxxx 80
feet wide lying below an elevation of 328 feet based on national geodetic
vertical datum of 1929 per Ordinance No. 150,763 of the City of Los Angeles
effective May 19, 1978 as shown on the map of Xxxxx Xx. 00000 recorded in Book
912, Pages 39 to 45 inclusive of Maps, in the office of the County Recorder of
Los Angeles County, bounded and described as follows:
Beginning at the most Northerly corner of that portion of 0xx Xxxxxx vacated by
instrument recorded as Instrument No. 80-643546 in Official Records of Los
Angeles County; thence Northerly along the Northeasterly extension of the
Northeasterly line of said vacated portion a distance of 5 feet; thence
Southwesterly at right angles to a curve being the boundary of the right of way
of Hope Street and Third Street, then Southeasterly along said curve to
Northwesterly boundary of said vacated portion of 0xx Xxxxxx; thence
Northeasterly along said Northwesterly boundary to the point of beginning, as
provided in the deed from the City of Los Angeles, recorded November 18, 1981 as
Instrument No. 00-0000000, Official Records.
A-1
EXCEPTING that portion of said land described as follows:
Beginning at a point in the Southeasterly line of said Lot 6 that is distant
thereon North 37(degree) 50' 12" East 6.16 feet from the most Southerly corner
of said Lot 6; thence along said Southeasterly line, South 37(degree) 50' 12"
West 6.16 feet to said most Southerly corner; thence along the Southwesterly
line of said Xxx 0, Xxxxx 00(xxxxxx) 0' 00" Xxxx 317.76 feet to the most
Westerly corner of said Lot 6; thence along the Northwesterly line of said Xxx
0, Xxxxx 00(xxxxxx) 00' 00" Xxxx 6.17 feet; thence leaving said Northwesterly
line South 52(degree) 9' 48" East 30.94 feet; thence South 37(degree) 50' 12"
West 2.00 feet; thence South 52(degree) 9' 48" East 95.885 feet; thence South
70(degree) 9' 48" East 2.45 feet; thence South 52(degree) 9' 48" East 0.77 feet;
thence North 82(degree)50' 12" East 2.45 feet; thence South 52(degree)9' 48"
East 95.885 feet; thence North 37(degree) 50' 12" East 2.00 feet; thence South
52(degree) 9' 48" East 90.42 feet to the point of beginning.
ALSO EXCEPTING from all of the above described land, all oil, gas and other
mineral substances, together with the right to extract such substances, provided
that the surface opening of a well, hole, shaft or other means of reaching or
moving such substances shall not be located within the Bunker Hill Urban Renewal
Project Areas, as recorded in Book M335, Page 106, Official Records, and shall
not penetrate any part of portion of said project area within 500 feet of the
surface thereof, as reserved in various deeds of record, among them being the
deed recorded May 20, 1966 in Book D3311, Page 794, Official Records.
ALSO EXCEPTING and reserving to the City of Los Angeles, all oil, gas, water and
mineral rights without, however, the right to use the surface of the said land
or any portion thereof to a depth of 500 feet below the surface for the
extraction of such oil, gas, water or minerals, as provided in the deed from the
City of Los Angeles recorded July 7, 1980 as Instrument No. 80-647237, Official
Records.
ALSO reserving to the City of Los Angeles, all oil, gas, water and mineral
rights without, however the right to use the surface of the said land or any
portion thereof to a depth of 500 feet below the surface for the extraction of
such oil, gas, water or minerals, as provided in the deed from the City of Los
Angeles, recorded November 18, 1981 as Instrument No. 00-0000000, Official
Records.
PARCEL 2:
Those portions of Xxxx 0 xxx 0 xx Xxxxx Xx. 00000, in the City of Los Angeles,
County of Los Angeles, State of California, as per map recorded in Book 912,
Pages 39 to 45 (inclusive) of Maps, in the office of the County Recorder of said
County, lying at elevation 381.25, [ based on City of Los Angeles Datum U.S.G.S.
Mean sea level based on City of Los Angeles Datum U.S.G.S. Mean sea level (1970
adjust) ], described as follows:
Beginning at a point in the Northeasterly line of the land described in the deed
recorded March 13, 1981 as Instrument No. 81-320601, Official Records, distant
thereon 17.2 feet more or less from its intersection with the Southeasterly line
of Hope Street, as shown on the Map of said Tract; leaving said line South 37
degrees 50 minutes 12 seconds West a distance of 91.2 feet more or less to an
angle point; thence reversing direction North 82 degrees 50 minutes 12 seconds
East a distance of 115.1 feet more or less to a point; thence North 37 degrees
50 minutes 12 seconds East a distance of 2.1 feet more or less to the
Northeasterly line described in the last mentioned deed; thence along said
Northeasterly line North 52 degrees 09 minutes 48 seconds West a distance of
67.6 feet more or less; thence North 37 degrees 50 minutes 12 seconds East
2.00 feet; thence North 52 degrees 09 minutes 48 seconds 13.73 feet more or less
to the point of beginning.
PARCEL 3:
All easements, rights, covenants, conditions and restrictions more particularly
described in that certain reciprocal easement and operating agreement executed
by Xxxxxxx Partners-Xxxxxxx Properties Phase I, a California limited partnership
and Xxxxxxx Partners-Xxxxxxx Properties-South Tower, a California limited
partnership, dated as of December 20, 1982 and recorded in the Official Records
of Los Angeles County, California on December 22, 1982 as Instrument No.
00-0000000, Official Records.
EXHIBIT B
ASSIGNMENT AND ASSUMPTION OF MEMBERSHIP INTEREST
THIS ASSIGNMENT AND ASSUMPTION OF MEMBERSHIP INTEREST (this
"ASSIGNMENT") is made and entered into as of the ___ day of _______, 2003, by
and between XXXXXXX GRANDE, INC., a California corporation ("XXXXXXX GRANDE")
and XXXXXXX PROPERTIES, INC., a California corporation ("XXXXXXX PROPERTIES")
(Xxxxxxx Grande and Xxxxxxx Properties are hereinafter collectively referred to
as "ASSIGNOR") having an office at c/o Wells Fargo, N.A., 000 Xxxxx Xxxxx
Xxxxxx, Xxxxx 000, Xxx Xxxxxxx, Xxxxxxxxxx 00000 and___________________________,
a _____________ having an office at 000 Xxxx Xxxxx Xxxxxx, Xxxxx 0000, Xxx
Xxxxxxx, XX, 00000 (the "ASSIGNEE").
RECITALS
North Tower LLC ("PROPERTY LLC") is a Delaware limited liability
company which owns the 54-story office tower known as the Xxxxx Fargo Tower,
having an address of 000 Xxxxx Xxxxx Xxxxxx, Xxx Xxxxxxx, Xxxxxxxxxx 00000.
Pursuant to an Amended and Restated Operating Agreement of Property LLC dated
April 27,1998, Property LLC has two members: North Tower Manager, LLC ("MANAGER
LLC") which owns 0.5% of the membership interests in Property LLC; and North
Tower Member, LLC ("MEMBER LLC") which owns 99.5% of the membership interests in
Property LLC. Pursuant to the Operating Agreement of Manager LLC dated April 27,
1998 (as amended, the "MANAGER OPERATING AGREEMENT") and the Operating Agreement
of Member LLC dated April 27, 1998 (as amended, the "MEMBER OPERATING
AGREEMENT") Assignor is the owner of a 42% interest in each of Manager LLC and
Member LLC.
Pursuant to the Agreement of Purchase and Sale between Assignor, as
seller, and Xxxxxxx Partners-Bunker Hill, Ltd., as purchaser, dated May 29, 2003
("AGREEMENT OF SALE"), (A) Xxxxxxx Grande wishes to assign to Assignee and
Assignee wishes to acquire, (i) Xxxxxxx Grande's 42% Percentage Interest in
Manager LLC; (ii) all rights of Xxxxxxx Grande as a Member of Manager LLC; (iii)
all right, title and interest of Xxxxxxx Grande in and to profits, losses,
distributions and capital accounts in Manager LLC; (iv) all rights of Xxxxxxx
Grande in and to the cash and cash reserves held by Manager LLC, including but
not limited to all cash reserves supporting obligations owed to one or more
Lenders of Property LLC and/or Manager LLC (the rights, titles and interests
referred to in clauses (i), (ii), (iii) and (iv) are collectively referred to
herein as the "MANAGER INTERESTS"); and (B) Xxxxxxx Properties wishes to assign
to Assignee and Assignee wishes to acquire, (i) Xxxxxxx Properties' 42%
Percentage Interest in Member LLC; (ii) all rights of Xxxxxxx Properties as a
Member of Member LLC; (iii) all of the rights, title and interests of Xxxxxxx
Properties in and to profits, losses, distributions and capital accounts in
Member LLC; (iv) all rights of Xxxxxxx Properties in and to cash and cash
reserves held by Member LLC, including but not limited to all cash reserves
supporting obligations owed to one or more Lenders of Property LLC and/or Member
LLC (the rights, titles and interests referred to in clauses (i), (ii), (iii)
and (iv) are collectively referred to herein as the "MEMBER INTERESTS"). The
Manager Interests and the Member Interests are, collectively, the "INTEREST",
which Interest constitutes all of Xxxxxxx Grande's right, title and interest in
and to Manager LLC and all of Xxxxxxx Properties' right, title and interest in
and to Member LLC, as hereinafter provided.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by each party hereto, Assignor and
Assignee agree as follows:
1. ASSIGNMENT OF MEMBERSHIP INTEREST. Assignor hereby assigns,
transfers and sets over unto Assignee the Interest free and clear of any lien or
encumbrance on, security interest in or claim to or against the Interest.
2. ASSUMPTiON OF MEMBERSHIP INTEREST. Assignee hereby assumes all of
the obligations of Assignor with respect to the Interest arising upon and after
the transfer of the Interest effected by this Assignment.
3. EFFECTIVE DATE. The assignment and assumption herein made are
effective as of the date of this Assignment.
4. REPRESENTATIONS OF ASSIGNOR.
(a) Title to Interest. Assignor represents and warrants to Assignee
that: (a) Assignor is the sole owner of the Interest, free and clear of any lien
or encumbrance on, security interest in or claim thereto, or of any prohibitions
on transfer, and (b) Assignor has the power and authority to assign the
Interest.
(b) Existence of Assignor. Each Assignor is a corporation which is
duly formed, organized, validly existing and in good standing under the laws of
the State of California.
(c) Authority of Assignor. Each Assignor has full power, right and
authority to enter into this Assignment.
(d) Authorization of Transaction. This Assignment has been duly
authorized by all necessary corporate action of each Assignor.
(e) Compliance with Agreements. The execution and delivery of this
Assignment will not (a) violate any provisions of the certificate of
incorporation or bylaws of either Assignor, (b) violate, conflict with, or, with
or without notice or the passage of time, result in a breach of, constitute a
default under or accelerate the performance required by, any of the terms or
provisions of any instrument, indenture, contract, agreement, franchise or
permit to which either Assignor is a party or by which either Assignor is bound,
or (c) violate or conflict with any applicable regulations of any Governmental
Authority, or any judgment, order or decree of any court having jurisdiction
over either Assignor or its properties. No consent, approval, order,
authorization, designation, registration, declaration or filing of, with or by
any third party or Governmental Authority is required for the execution of this
Assignment by either Assignor, except any consent which may be specified in the
Agreement of Sale which shall have been obtained by the execution and delivery
of this Assignment.
5. REPRESENTATIONS OF ASSIGNEE.
(a) Existence of Assignee. Assignee is a _____________ which is duly
formed, organized, validly existing and in good standing under the laws of the
State of ______________.
(b) Authority of Assignee. Assignee has full power, right and
authority to enter into this Assignment.
(c) Authorization of Transaction. This Assignment has been duly
authorized by all necessary [corporate/partnership/limited liability company]
action of Assignee.
(d) Compliance with Agreements. The execution and delivery of this
Assignment will not (a) violate any provisions of the certificate of
incorporation or bylaws of Assignee, (b) violate, conflict with, or, with or
without notice or the passage of time, result in a breach of, constitute a
default under or accelerate the performance required by, any of the terms or
provisions of any instrument, indenture, contract, agreement, franchise or
permit to which Assignee is a party or by which Assignee is bound, or (c)
violate or conflict with any applicable regulations of any Governmental
Authority, or any judgment, order or decree of any court having jurisdiction
over Assignee or its properties. No consent, approval, order, authorization,
designation, registration, declaration or filing of, with or by any third party
or Governmental Authority is required for the execution of this Assignment by
Assignee, except any consent which may be specified in the Agreement of Sale
which shall have been obtained by the execution and delivery of this Assignment.
6. FUTURE COOPERATION. Assignor and Assignee shall cooperate from and
after the date hereof with respect to the supplying of information reasonably
requested by the other regarding the transaction embodied by this Assignment or
any matter related thereto or related to Member LLC or Manager LLC or the
Interest. Assignor and Assignee, respectively, shall at any time, and from time
to time, promptly execute, acknowledge and deliver all further instruments and
documents, and take all further actions that may be reasonably necessary or
desirable, or that Assignor or Assignee, respectively, may reasonably request,
in order to evidence or effect the agreement and assignment made or intended to
be made under this Assignment. All reasonable out of pocket costs (excluding
overhead costs) incurred by either party in cooperation with the reasonable
request of the other party shall be borne by the requesting party. Assignee
shall use reasonable efforts to cause Member LLC and Manager LLC to deliver to
Assignor on or before March 15, 2004, subject to extension if Member LLC or
Manager LLC files for and receives an extension of the deadline for filing their
tax returns, at no cost to Assignor, true, correct and complete copies of the
federal, state and local (if any) income tax returns of Member LLC and Manager
LLC for the current fiscal year of Member LLC and Manager LLC, with Assignor's
Schedule K-l attached to the federal return, and cause Member LLC and Manager
LLC to furnish Assignor, within a reasonable time after request, such
information relating to such income tax returns and the affairs of Member LLC
and Manager LLC as Assignor may reasonably request from time to time for
purposes of filing Assignor's federal, state and local (if any) income tax
returns and related filings.
7. SUCCESSORS AND ASSIGNS. This Assignment shall be binding upon and
inure to the benefit of Assignor and Assignee and their respective successors
and assigns.
8. MODIFICATION AND WAIVER. No supplement, modification, waiver or
termination of this Assignment or any provision hereof shall be binding unless
executed in writing by the parties to be bound thereby. No waiver of any of the
provisions of this Assignment shall constitute a waiver of any other provision
(whether or not similar), nor shall such waiver constitute a continuing waiver
unless otherwise expressly provided.
9. ENTIRE AGREEMENT. This Assignment, together with the Survival
Provisions, as that term is defined in the Agreement of Sale, represents the
entire agreement between the parties hereto and supersedes all prior
understandings, oral or written, between Assignor and Assignee and may not be
amended except by a writing signed by Assignor and Assignee.
10. COUNTERPARTS. This Assignment maybe executed in two or more
counterparts, each of which shall for all purposes be deemed to constitute an
original, but all of which, when taken together, shall constitute but one
instrument, and shall become effective when copies hereof when taken together,
bear the signatures of each of the parties hereto.
11. CAPTIONS. Captions and other headings of this Assignment are for
convenience of reference only and in no way define, limit, prescribe, expand or
otherwise alter the scope or intent of this Assignment or in any way affect this
Assignment or any provision hereof.
12. INTERPRETATION. Words in the singular shall be held to include
the plural and vice versa. Words of one gender shall be held to include the
other genders as the context requires. The terms "hereof;" "herein" and
"herewith" and words of similar import shall be construed to refer to this
Assignment in its entirety and not to any particular provision unless otherwise
stated. The word "person" shall mean any natural person, partnership,
corporation and any other form of business or legal entity. Terms not defined
herein shall have the meaning for such term set forth in the Agreement of Sale.
13. CONSTRUCTION. This Assignment shall be construed without regard
to any presumption or title requiring construction against the party drafting or
causing any instrument to be drafted.
14. GOVERNING JURISDICTION. This Assignment shall be construed and
enforced in accordance with and governed by the laws of the State of California.
15. JURISDICTION. The parties hereto irrevocably consent to submit
to the exclusive jurisdiction of the courts of the State of California and of
the United States District Court for the Central District of California over any
suit, action or proceeding arising out of or related to this Assignment or any
other document or instrument relating to this Assignment.
16. ATTORNEYS' FEES. In the event any dispute between any Assignor
and Purchaser should result in litigation, the prevailing party shall be
reimbursed for all reasonably costs incurred in connection with such litigation,
including, without limitation, reasonable attorneys' fees.
17. NO THIRD PARTY BENEFICIARIES. The provisions of this Assignment
are intended to be solely for the benefit of Assignor and Assignee and their
respective successors and assigns, and none of the provisions of this Indemnity
are intended to be, nor shall they be construed to be, for the benefit of any
third person or entity.
18. CONFIDENTIALITY. The terms of this Assignment, and all documents
prepared in connection herewith shall be confidential, shall not be disclosed
(except for reasonably necessary disclosures to agents, lenders, investors,
representatives, lawyers and accountants, and as required by law, including,
without limitation, any applicable securities laws), and (except for this
Assignment and any written agreement fully executed and delivered by and between
any of the parties hereto, and except for documents existing as of the date of
this Assignment which are discoverable in any litigation or other proceeding
involving Assignor, on the one hand, and Assignee, on the other hand) may not be
introduced in any such litigation or other proceeding (the same being privileged
in the same manner as a settlement offer in litigation).
19. SERVICE. The parties hereto irrevocably consent to service of
process in any suit, action or proceeding within the State of California arising
out of or related to this Assignment or any other document or instrument
relating to this Assignment sent by reputable overnight courier service, for
next day delivery or by hand delivery to the following persons at the following
addresses:
Assignor:
Xxxxxxx Grande, Inc.
c/o Wells Fargo Bank, N.A.
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxx Xxxxxx, Senior Vice President
E-mail: xxxxxxx@xxxxxxxxxx.xxx
With copies to:
Xxxxxxx Properties, Inc.
c/x Xxxxx Fargo Bank, N.A.
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxxxx Xxxxx-Xxxxxx
E-mail: xxxxxxx@xxxxxxxxxx.xxx
and
Xxxxx Xxxxxxxxxx LLP
000 Xxxxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxx X. Xxxxxx, Esq.
E-Mail: xxxxxxx@xxxxx.xxx
provided that each such person may from time to time specify a
different person or address by written notice given in the same manner as
aforesaid for service.
Assignee:
Xxxxxxx Partners
000 Xxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxx III and Xxxx X. Lammas, Esq.
E-mail: xxxxxx.xxxxxxx@xxxxxxxxxxxxxxx.xxx
xxxx.xxxxxx@xxxxxxxxxxxxxxx.xxx
With copies to:
Xxxxxxxxx & Xxxxxx Professional Corporation
0000 Xxxxx Xxxxxx, Xxxxx 000
Xxxxx Xxxxxx, Xxxxxxxxxx 00000
Attn: Xxxx X. Xxxxxx, Esq.
E-mail: xxxxxxx@xxxxxxxxx.xxx
provided that each such person may from time to time specify a
different person or address by written notice given in the same manner as
aforesaid for service.
The date upon which any such notice shall be deemed given and received
shall be: (i) if hand delivered, on the date of personal presentation; or (ii)
if sent by reputable overnight courier service for next day delivery, two (2)
business days following the delivery of such notice to such courier. The parties
hereto shall utilize best efforts to communicate the contents of any notice
given by such Person by telephone or e-mail on the day of the delivery of such
notice to the courier service (the failure to make telephone notice or e-mail
notice shall not impair the effectiveness of the courier service notice for the
purpose of this Agreement).
IN WITNESS WHEREOF, this Assignment is executed as of the day and year
first above written.
ASSIGNOR:
XXXXXXX GRANDE, INC.,
a California corporation
By:
----------------------------------
Xxxx X. Xxxxxx
Senior Vice President
XXXXXXX PROPERTIES, INC.,
a California corporation
By:
----------------------------------
Xxxx X. Xxxxxx
Executive Vice President
ASSIGNEE:
-----------------------------------------
-----------------------------------------
-----------------------------------------
EXHIBIT C
TENANT IMPROVEMENT, CAPITAL EXPENDITURES AND LEASING COMMISSIONS
XXXXX FARGO TOWER
CAPITAL COST OBLIGATIONS PENDING
Xxxxx Xxxxxxxxxx 97,524
La Petite Boulangerie 7,345
LAUSD Extension 317,202
Copy Page 5,659
Bank One 194
Xxxxxxx 12,112
Zevnick Horton 109,989
Roebecks 2,835
Xxxxxx & Rygel 1,828,120
Total 2,380,980
Excluded From Schedule
Xxxxxx Xxxx & Xxxxxxxx 14,430,025
EXHIBIT D
INDEMNITY
THIS INDEMNITY, dated _________, 2003 (this "INDEMNITY") is made by
NORTH TOWER MEMBER, LLC, a Delaware limited liability company ("MEMBER LLC"),
and NORTH TOWER MANAGER, a Delaware limited liability company, having an address
at 000 Xxxx Xxxxx Xxxxxx, Xxxxx 0000, Xxx Xxxxxxx, XX, 00000 ("MANAGER LLC", and
collectively with Member LLC, "INDEMNITOR") for the benefit of XXXXXXX GRANDE,
INC., a California corporation ("XXXXXXX GRANDE") and XXXXXXX PROPERTIES, INC.,
a California corporation ("XXXXXXX PROPERTIES") (Xxxxxxx Grande and Xxxxxxx
Properties are hereinafter collectively referred to as "SELLER") having an
office at c/x Xxxxx Fargo Bank, N.A., 000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000, Xxx
Xxxxxxx, Xxxxxxxxxx 00000.
RECITALS
North Tower LLC ("PROPERTY LLC") is a Delaware limited liability
company which owns the 54-story office tower known as the Xxxxx Fargo Tower,
having an address of 000 Xxxxx Xxxxx Xxxxxx, Xxx Xxxxxxx, Xxxxxxxxxx 00000.
Pursuant to an Amended and Restated Operating Agreement of Property LLC dated
April 27, 1998, Property LLC has two members: Manager LLC, which owns 0.5% of
the membership interests in Property LLC, and Member LLC, which owns 99.5% of
the membership interests in Property LLC. Pursuant to the Operating Agreement of
Manager LLC dated April 27,1998 (as amended, the "MANAGER OPERATING AGREEMENT")
and the Operating Agreement of Member LLC dated April 27,1998 (as amended, the
"MEMBER OPERATING AGREEMENT"), Seller is the owner of a 42% interest in each of
Manager LLC and Member LLC.
Seller and Xxxxxxx Partners - Bunker Hill, Ltd., a California limited
partnership ("BUNKER HILL"), have entered into an Agreement of Purchase and Sale
("AGREEMENT OF SALE") dated as of May 29, 2003, for the purchase and sale of:
(A) (i) Xxxxxxx Grande's 42% Percentage Interest in Manager LLC; (ii) all rights
of Xxxxxxx Grande as a Member of Manager LLC; (iii) all right, title and
interest of Xxxxxxx Grande in and to profits, losses, distributions and capital
accounts in Manager LLC; (iv) all rights of Xxxxxxx Grande in and to the cash
and cash reserves held by Manager LLC, including but not limited to all cash
reserves supporting obligations owed to one or more Lenders of Property LLC
and/or Manager LLC ((the rights, titles and interests referred to in clauses
(i), (ii), (iii) and (iv) are collectively referred to herein as the "MANAGER
INTERESTS"); and (B) (i) Xxxxxxx Properties' 42% Percentage Interest in Member
LLC; (ii) all rights of Xxxxxxx Properties as a Member of Member LLC; (iii) all
of the rights, title and interests of Xxxxxxx Properties in and to profits,
losses, distributions and capital accounts in Member LLC; (iv) all rights of
Xxxxxxx Properties in and to cash and cash reserves held by Member LLC,
including but not limited to all cash reserves supporting obligations owed to
one or more Lenders of Property LLC and/or Member LLC (the rights, titles and
interests referred to in clauses (i), (ii), (iii) and (iv) are collectively
referred to herein as the "MEMBER INTERESTS"). The Manager Interests and the
Member Interests are, collectively, the "INTEREST", which Interest constitutes
all of Xxxxxxx Grande's right, title and interest in and to Manager LLC and all
of Xxxxxxx Properties' right, title and interest in and to Member LLC. To induce
Seller to enter into
D-1
the Agreement of Sale, Indemnitor has agreed to execute and deliver an indemnity
in favor of Seller.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, Indemnitor hereby covenants, agrees
with, represents and warrants to the Seller Parties as follows:
1. DEFINITIONS.
Unless the context otherwise specifies or requires, the following terms shall
have the meanings herein specified throughout this Agreement.
"AFFILIATE" As defined in the Agreement
of Sale (such definition in
the Agreement of Sale
together with all other
terms and provisions of the
Agreement of Sale necessary
for the enforcement of this
Agreement shall survive the
closing and transfer of the
Interests contemplated by
the Agreement of Sale).
"AGREEMENT OF SALE"
As defined in the Recital
hereof.
"ASSIGNMENT AND ASSUMPTION OF MEMBERSHIP INTEREST" As defined in the Agreement
of Sale.
"BUNKER HILL" As defined in the Recital
hereof.
"BUSINESS DAY" Any day that is not a
Saturday, Sunday, or a state
or federal holiday in the
Los Angeles, California
area.
"CLOSING" The transfer of the Interest
from Seller to Bunker Hill
(or its designee) in
accordance with the
Agreement of Sale.
"INDEMNIFIED MATTERS" As defined in Section 2.1
hereof.
"INDEMNITOR" As defined in the Preamble
hereof.
"INDEMNITY" As defined in the Preamble
hereof.
"INTEREST" As defined in the Preamble
hereof.
"LENDER" Any lender, or its
successors and assigns, to
any of Property LLC, Member
LLC, and/or Manager LLC in
connection with any
outstanding financing of the
Real Property and/or the
LLCs and any rating agencies
rating the securities with
respect thereto.
D-2
"LLCS" Collectively, Property LLC,
Manager LLC and Member LLC.
"MANAGER LLC" As defined in the preamble
hereof.
"MANAGER OPERATING AGREEMENT" As defined in the Recital
hereof.
"MEMBER" Any member of Manager LLC or
Member LLC.
"MEMBER LLC" As defined in the preamble
hereof.
"PERSON" Any natural person.
partnership, corporation
limited liability company
and any other form of
business or legal entity.
"PROPERTY" Collectively, the Real
Property, all of the
buildings constituting the
Xxxxx Fargo office tower and
all other improvements on
the Real Property owned by
Property LLC, all leases,
subleases, licenses, tenancy
or occupancy agreements and
operating agreements with
tenants and occupants
occupying space on the Real
Property and all amendments,
modifications and
supplements thereto,
including, without
limitation, all security
deposits and advance
payments of rents and other
charges held by Property LLC
in connection with said
leases and other agreements,
collectively, all service
contracts, maintenance
agreements, equipment leases
and other contracts and
agreements providing for the
furnishing of goods,
equipment and services in
connection with the
maintenance and operation of
the Real Property in the
ordinary course of business
and all trade names, logos,
marks, trademarks, service
marks, symbols and items of
identification relative to
the Real Property.
"PROPERTY LLC" As defined in the Recital
hereof.
"PROPERTY LLC AGREEMENT" Amended and
Restated Operating Agreement
of Property LLC dated as of
April 27, 1998, as amended.
"PROPERTY MANAGEMENT AGREEMENT" Amended and Restated
Property Management
Agreement between Xxxxxxx
Partners Development, Ltd.
and Property LLC dated as of
April 27, 1998, as amended.
D-3
"PURCHASER" As defined in the Agreement
of Sale.
"REAL PROPERTY" The fee simple interest of
Property LLC in the real
estate described in Exhibit
"A" annexed hereto, together
with all buildings and
improvements situated
thereon, all easements,
rights, privileges and
appurtenances belonging
thereto, including, among
other things, all of the
buildings constituting the
Xxxxx Fargo office tower and
all other improvements
thereon, and subject to all
matters and defects of title
now existing and hereafter
created.
"SELLER" As defined in the Recital
hereof.
"TRANSACTION DOCUMENTS" Collectively, the Agreement
of Sale, the Assignment and
Assumption of Membership
Interest, the Manager
Operating Agreement, the
Member Operating Agreement,
the Property LLC Operating
Agreement, the Property
Management Agreement, any
loan documents in connection
with the Property, and any
other documents and
instruments related to any
of the foregoing, the
Property, or the LLCs.
"XXXXX FARGO LEASE" The Office Lease dated May
22, 1980, by and between
Xxxxx Fargo Bank, NA and
Property LLC, as
successor-in-interest to
Xxxxxxx Partners-Xxxxxxx
Properties Phase I, a
California limited
partnership, as amended.
1.1 Captions. Captions and other headings of this Indemnity are for
convenience of reference only and in no way define, limit, prescribe, expand or
otherwise alter the scope or intent of this Indemnity or in any way affect this
Indemnity or any provision hereof.
1.2 Interpretation. Words in the singular shall be held to include the
plural and vice versa and words of one gender shall be held to include the other
gender as the context requires. The terms "hereof" "herein" and `herewith" and
words of similar import shall be construed to refer to this Indemnity in its
entirety and not to any particular provision unless otherwise stated. The use
herein of the word "including" when following any general statement, term or
matter shall not be construed to limit such statement, term or matter to the
specific items or matters whether or not non-limiting language (such as "without
limitation" or "but not limited to" or words of similar import) is used with
reference thereto but rather shall be deemed to refer to all other items or
matters that could reasonably fall within the broadest possible scope of such
general statement, term or matter.
D-4
1.3 Governing Law . This Indemnity shall be construed and enforced
in accordance with and governed by the substantive laws of the State of
California.
1.4 Construction. All parties to this Indemnity have been
represented by counsel, and this Indemnity has been the subject of extensive
review and negotiation. This Indemnity shall be construed without regard to any
presumption or rule requiring construction against the party drafting or causing
any instrument to be drafted. It is the intention of the parties hereto that
each of the provisions of this Indemnity be interpreted in such a manner as to
sustain the enforceability of such provision. Thus, in all cases in which one or
more constructions of such provision would result in the determination that such
provision is unenforceable, the parties hereto intend that construction of the
provision that would result in the provision being enforceable.
2. INDEMNITY.
2.1 Indemnified Matters. Indemnitor shall, jointly and severally, at
its sole cost and expense, indemnify, protect and save Seller and Seller's
Affiliates harmless against and from any and all damages, losses, liabilities,
claims, demands, injuries, deficiencies, judgments, suits, proceedings, and
costs or expenses arising therefrom (including, without limitation, reasonable
attorneys' fees and disbursements of attorneys that are selected by Seller in
its sole discretion) (collectively, "CLAIMS") of any kind or of any nature
whatsoever (collectively, the "INDEMNIFIED MATTERS") which may be imposed upon,
incurred by or awarded against Seller and arising at any time out of, as a
result of, in connection with, or with respect to:
(a) The Property or any portion thereof, the Interests or any
portion thereof, the LLCs, any Transaction Documents (excluding the Agreement of
Sale and Assignment and Assumption of Membership Interest except as described in
clause (c) below), excluding (i) any Claims arising out of the acts of any
Seller constituting negligence or willful misconduct and (ii) all
representations, warranties, covenants, duties, liabilities and obligations
arising under or in connection with the Xxxxx Fargo Lease.
(b) Any actions or inactions of Bunker Hill or any other parties
to any of the Transaction Documents which constitute negligence or willful
misconduct;
(c) The breach of any covenant or any express representation or
warranty made by Bunker Hill and/or its nominee under the Agreement of Sale, the
Assignment and Assumption of Membership Interest, this Indemnity, or any other
document or instrument entered into in connection with any of the transactions
described herein; and
(d) The defense of any action or proceeding brought against
Seller in respect of any Claims described in whole or in part by any of
Subparagraphs (a)-(c) of this Section 2.1.
2.2 Payment. Seller may submit invoices, statements, bills or other
requests for payment or for reimbursement in respect of any of the Indemnified
Matters. Indemnitor shall promptly reimburse Seller for any Indemnified Matters
incurred by Seller within thirty (30) days
D-5
of Indemnitor's receipt of any request for payment or for reimbursement from
Seller. The Indemnified Matters shall include, without limitation, the
reasonable attorneys fees and disbursements incurred by Seller for attorneys
selected by Seller in its sole discretion in (a) any bankruptcy proceeding (i)
of Indemnitor or (ii) affecting any Indemnified Matter or any rights or
interests of any Seller hereunder, or (b) exhausting all court appeals for any
Indemnified Matter which is decided against Seller by any court or Governmental
Authority of competent jurisdiction; provided, however, that Seller shall have
no obligation to appeal any such Indemnified Matter.
2.3 Rights of Seller. Indemnitor authorizes Seller, without giving
notice to Indemnitor or obtaining Indemnitor's consent and without affecting the
liability of Indemnitor, from time to time to: (a) renew or extend all or any
portion of Bunker Hill's obligations under the Agreement of Sale; (b) make
non-material changes in the dates specified for payments of any sums payable
under the Agreement of Sale; (c) with Bunker Hill's consent otherwise modify the
terms of the Agreement of Sale; (d) take and hold security for the performance
of Bunker Hill's obligations under the Agreement of Sale and exchange, enforce,
waive and release any such security; (e) apply such security and direct the
order or manner of sale thereof as Seller in its discretion may determine; (f)
release, substitute or add any one or more indemnitors or guarantors of Bunker
Hill's obligations under the Agreement of Sale; and (g) apply payments received
by Seller from Bunker Hill to any obligations of Bunker Hill to Seller as Seller
shall determine in its sole discretion, whether or not any such obligations are
covered by this Indemnity.
2.4 Waivers. Indemnitor waives: (a) any defense based upon any legal
disability or other defense of Bunker Hill, any other indemnitor or guarantor or
other person, or by reason of the cessation or limitation of the liability of
Bunker Hill; (b) any defense based upon any lack of authority of the officers,
directors, partners or agents acting or purporting to act on behalf of Bunker
Hill or any principal of Bunker Hill or any defect in the formation of Bunker
Hill or any principal of Bunker Hill; (c) any and all rights and defenses
arising out of an election of remedies by Seller; (d) any defense based upon
Seller's failure to disclose to Indemnitor any information concerning Bunker
Hill's financial condition or any other circumstances bearing on Bunker Hill's
ability to pay; (e) any defense based upon any statute or rule of law which
provides that the obligation of a surety must be neither larger in amount nor in
any other respects more burdensome than that of a principal; (f) any right of
subrogation, any right to enforce any remedy which Seller may have against
Bunker Hill and any right to participate in, or benefit from, any security now
or hereafter held by Seller; (g) presentment, demand, protest and notice of any
kind; (h) the benefit of any statute of limitations affecting the liability of
Indemnitor hereunder or the enforcement hereof; and (i) any right to cause a
marshalling of Indemnitor's assets or to proceeds against Indemnitor in any
particular order. Without limiting the generality of the foregoing or any other
provision hereof, Indemnitor further expressly waives to the extent permitted by
law any and all rights and defenses, including without limitation any rights of
subrogation, reimbursement, indemnification and contribution, which might
otherwise be available to Indemnitor under California Civil Code Sections 2787
to 2855, inclusive, 2899 and 3433, or under California Code of Civil Procedure
Sections 580a, 580b, 580d and 726, or any of such sections. Finally, Indemnitor
agrees that the performance of any act or any payment which
D-6
tolls any statute of limitations applicable to the Agreement of Sale shall
similarly operate to toll the statute of limitations applicable to Indemnitor's
liability hereunder.
2.5 Enforceability of Indemnity and other InstrumentS. Indemnitor
shall not challenge the validity or enforceability of this Indemnity in any
action or proceeding brought in any jurisdiction or any forum whatsoever.
2.6 Subrogation. Indemnitor shall be subrogated to all rights of
Seller against any third party (but not against any of Seller's agents,
Affiliates, attorneys, accountants, advisors or representatives or the members,
partners, shareholders, officers, directors or employees of any of them) giving
rise to the Indemnified Matters. Seller will cooperate, at no cost or expense to
Seller, with Indemnitor in pursuing Indemnitor's subrogation rights.
3. MATTERS NOT AFFECTING INDEMNIFIED MATTERS.
3.1 Indemnified Matters Unconditional. To the fullest extent
permitted by law, the covenants, obligations and liabilities of Indemnitor
hereunder shall not be affected, modified, released or impaired by any state of
facts or the happening from time to time of any event, including, without
limitation, any of the following, whether or not with notice to, or the consent
of, Indemnitor:
(a) Invalidity Unenforceability of Documents. The invalidity or
unenforceability of all or any portion of one or more of the Agreement of Sale
or any other Transaction Documents;
(b) Modification or Release of Indemnified Matters. The
compromise, settlement or release of any claim or counterclaim in respect of any
Indemnified Matters.
(c) Failure to Give Notice. The failure to give notice to
Indemnitor of the occurrence of any breach by Indemnitor (or its Affiliates) of
any or all its obligations under this Indemnity, or the Agreement of Sale or any
other Transaction Documents without limiting the notice requirements for notice
to Indemnitor under this Indemnity;
(d) Extension of Time. The extension of time for the payment of
any amounts required to be paid by Indemnitor (or its Affiliates) or of time for
the performance of any other Indemnified Matter;
(e) Modification of Agreements. The modification or amendment
(whether material or otherwise) of any term, duty, obligation, covenant or
agreement set forth in the Agreement of Sale or any other Transaction Documents,
heretofore or hereafter made;
(f) Actions or Omissions of any Party. Any delay by any party to
any of the Transaction Documents, including, without limitation, Seller, in
taking any action or to pursue any right or remedy under any of the Transaction
Documents or any other documents related to the Property or any of the
Interests;
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(g) Actions or Omissions of Seller. The taking or delay in taking
or the failure to take any action or to pursue any right or remedy by Seller
under this Indemnity or under the Agreement of Sale or any other Transaction
Documents.
(h) Failure to Preserve Enforceability of Documents. Any failure
by Seller to preserve the enforceability of the Agreement of Sale or any other
Transaction Documents, or to preserve rights against any of the parties thereto
or hereto; or
(i) Sale of the Property. Any sale or transfer of the Property.
4. REPRESENTATIONS AND WARRANTIES.
4.1 Representations and Warranties of Indemnitor. Indemnitor hereby
represents and warrants to Seller that:
(a) Due Formation. Each Indemnitor is a limited liability company
which is duly formed, organized, validly existing and in good standing
under the laws of the State of Delaware;
(b) Authority. Each Indemnitor has the power, right and authority
to enter into and perform this Indemnity;
(c) Authorization of Indemnity. This Indemnity has been duly
authorized by all necessary limited liability company action of each
Indemnitor;
(d) No Violations. Neither this Indemnity, the execution,
delivery and performance hereof, nor the performance of the agreements
herein contained will violate any statute, ordinance, regulation court
order or decree or any other agreement to which any Indemnitor is
subject; and
(e) Binding Agreement. This Indemnity constitutes a valid and
binding agreement enforceable against Indemnitor in accordance with its
terms.
5. COVENANT.
5.1 Prohibition on Transfer. For the twelve (12) month period
following the Closing: (i) Indemnitor shall not transfer any of its membership
interests in Property LLC; (ii) Indemnitor shall continue to own collectively
100% of the membership interests in Property LLC and (iii) Property LLC shall
not transfer the Property, or any portion thereof or any interest therein.
6. MISCELLANY.
6.1 No Right to Jury Trial. Indemnitor hereby waives the right of
trial by jury in the event of any litigation between Seller and Indemnitor in
respect of any matter arising out of this Indemnity.
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6.2 Separate Causes of Action. Each and every default by Indemnitor
under this Indemnity shall give rise to a separate cause of action under this
Indemnity, and separate suits may be brought under this Indemnity as each cause
of action arises.
6.3 Expenses. Indemnitor shall pay all costs, fees and expenses
(including reasonable attorneys' fees and disbursements and court costs) which
may be incurred by Seller in enforcing this Indemnity, in defending against any
action or proceeding brought against Seller with respect to the Indemnified
Matters and with respect to any breach of this Indemnity, which Seller may do
using its counsel of choice, under this Indemnity, and/or in collecting or
attempting to collect any sums due under this Indemnity, whether the same shall
be enforced by suit or otherwise. Seller shall pay all costs, fees and expenses
(including reasonable attorneys' fees and disbursements and court costs) which
may be incurred by Indemnitor in defending against any action or proceeding
brought by Seller against Indemnitor for enforcement of this Indemnity if
Indemnitor shall be the prevailing party in such action.
6.4 Remedies Not Exclusive. No remedy herein conferred upon or
reserved to Seller is intended to be exclusive of any other available remedy
given under this Indemnity or hereafter existing at law or in equity.
6.5 No Waiver. No delay, forbearance or failure by Seller to
exercise any right, remedy and/or power of Seller accruing upon any default,
omission or failure of performance hereunder shall impair any such right, remedy
and/or power or shall constitute or be construed as a waiver thereof, but any
such right, remedy and/or power may be exercised from time to time and as often
as may be deemed expedient. If any provision contained in this Indemnity should
be breached by Indemnitor and thereafter duly waived, such waiver shall be
limited to the particular breach so waived and shall not be deemed to waive any
other breach hereunder. No waiver shall be deemed a continuing waiver or waiver
in respect of any subsequent breach or default, either of similar or different
nature, unless expressly so stated in writing. No waiver, amendment, release or
modification of this Indemnity shall be established by conduct, custom or course
of dealing, but solely by an instrument in writing duly executed by Seller and
Indemnitor.
6.6 Assignment. This Indemnity may not be assigned by Seller except
in connection with a merger, reorganization, consolidation, liquidation or
transfer of substantially all assets. Indemnitor shall not delegate any of its
duties or obligations hereunder, without Seller's prior written consent, which
may be granted or withheld in Seller's sole and absolute discretion.
6.7 Successors and Assigns. Whenever in this Indemnity Seller or
Indemnitor is referred to, such reference shall be deemed to include the
successors and assigns of such party, and all grants, covenants, promises,
agreements, terms, representations, warranties, provisions and conditions which
are contained in this Indemnity shall bind Indemnitor and its successors and
assigns, and inure to the benefit of Seller and its successors and assigns.
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6.8 No Third Party Beneficiaries. The provisions of this Indemnity
are intended to be solely for the benefit of Seller, Seller's Affiliates and
their respective successors and assigns, and none of the provisions of this
Indemnity are intended to be, nor shall they be construed to be, for the benefit
of any third person or entity.
6.9 Consent to Jurisdiction. Indemnitor hereby consents to the
exclusive jurisdiction and venue of the courts of the State of California with
respect to all matters relating to this Indemnity, the documents and instruments
related hereto and the observance and performance of the parties respective
Indemnified Matters thereunder, and Indemnitor consents to the personal
jurisdiction of such courts and each Person constituting Indemnitor shall
subject itself such personal jurisdiction. Any action, suit or proceeding
relating to such matters may be commenced, pursued, defended and resolved in
such courts and any appropriate appellate court having jurisdiction to hear an
appeal from any judgment entered in such courts. Service of process in any
action, suit or proceeding relating to such matters may be made and served
within or outside the State of California by registered or certified mail or
hand delivery to the party to receive same and its representatives at their
respective addresses specified herein, provided that a reasonable time, not less
than thirty (30) days, is allowed. Service of process may also be made in such
other manner as may be permissible under applicable court rules.
6.10 Notices. Any and all notices or other communications or
deliveries to be given or made with respect to this Indemnity shall be deemed to
have been duly given or made for all purposes if sent by certified or registered
mail, return receipt requested and postage prepaid, by recognized national
overnight delivery service, by telecopier or by hand delivery, as follows:
If to Seller:
Xxxxxxx Grande, Inc.
c/o Wells Fargo Bank, N.A.
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxx Xxxxxx, Senior Vice President
E-mail: xxxxxxx@xxxxxxxxxx.xxx
With copies to:
Xxxxxxx Properties, Inc.
c/x Xxxxx Fargo Bank, N.A.
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxxxx Xxxxx-Xxxxxx
E-mail: xxxxxxx@xxxxxxxxxx.xxx
and
D-10
Xxxxx Xxxxxxxxxx LLP
000 Xxxxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxx X. Xxxxxx, Esq.
E-Mail: xxxxxxx@xxxxx.xxx
provided that each such Person may from time to time specify
a. different address by notice given in accordance with this Section.
If to Indemnitor:
North Tower Manager LLC
North Tower Member LLC
c/o Maguire Partners
000 Xxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, XX, 00000
Attn: Xxxxxx X. Xxxxxxx III and Xxxx X. Xxxxx
E-mail: Xxxxxx.Xxxxxxx@xxxxxxxxxxxxxxx.xxx and
Xxxx.Xxxxxx@xxxxxxxxxxxxxxx.xxx
With copies to:
Xxxxxxxxx & Xxxxxx Professional Corporation
0000 Xxxxx Xxxxxx, Xxxxx 000
Xxxxx Xxxxxx, Xxxxxxxxxx 00000
Attn: Xxxx X. Xxxxxx, Esq.
E-Mail: xxxxxxx@xxxxxxxxx.xxx
provided that each such Person may from time to time specify a different address
by notice given in accordance with this Section.
The date upon which any such notice shall be deemed given and received
shall be: (i) if hand delivered, on the date of personal presentation; or (ii)
if sent by reputable overnight courier service for next day delivery, two (2)
business days following the delivery of such notice to such courier. The parties
hereto shall utilize best efforts to communicate the contents of any notice
given by such Person by telephone or e-mail on the day of the delivery of such
notice to the courier service (the failure to make telephone notice or e-mail
notice shall not impair the effectiveness of the courier service notice for the
purpose of this Agreement).
6.11 Amendment. Except as may be specifically provided otherwise
herein, no amendment, change, modification or addition to this Indemnity or any
part hereof shall be effective unless made in writing and signed by or on behalf
of the party to be charged therewith.
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6.12 Obligations Joint and Several. To the extent Indemnitor consists
of more than one party, each Indemnitor shall be jointly and severally liable
for all obligations and liabilities of the Indemnitor under this Indemnity.
6.13 Severability. Should any clause, section or part of this Indemnity
be held or declared to be void or illegal for any reason, all other clauses,
sections or parts of this Indemnity which can be effected without such illegal
clause, section or part shall nevertheless continue in full force and effect.
6.14 Survival. This Indemnity shall survive the closing of the
transaction contemplated by the Agreement of Sale, provided, however, that this
Indemnity shall automatically terminate upon the second anniversary of the
closing of the transaction contemplated by the Agreement of Sale and the
delivery of the assignment of interests thereunder.
6.15 Entire Agreement. This Indemnity contains and constitutes the
entire agreement between Indemnitor and Seller regarding the subject matter
hereof; and this Indemnity supersedes in its entirety all other agreements,
representations, warranties, statements, promises and understandings, whether
oral or written, with respect to the subject matter hereof; and no party hereto
shall be bound by or charged with any oral or written agreements,
representations, warranties, statements, promises or understandings not
specifically set forth in this Indemnity.
6.16 Attorneys' Fees. In the event any dispute between any Assignor and
Purchaser should result in litigation, the prevailing party shall be reimbursed
for all reasonably costs incurred in connection with such litigation, including,
without limitation, reasonable attorneys' fees.
6.17 Further Assurances. Each of Indemnitor and Seller shall without
further consideration execute and deliver such other documents and take such
other action as may be reasonably requested by the other party to consummate
more effectively the purposes or subject matter of this Indemnity.
6.18 Confidentiality. The terms of this Indemnity, and all documents
prepared in connection herewith shall be confidential, shall not be disclosed
(except for reasonably necessary disclosures to agents, lenders, investors,
representatives, lawyers and accountants, and as required by law, including,
without limitation, any applicable securities laws), and (except for this
Indemnity and any written agreement fully executed and delivered by and between
any of the parties hereto, and except for documents existing as of the date of
this Indemnity which are discoverable in any litigation or other proceeding
involving Indemnitor, on the one hand, and Seller, on the other hand) may not be
introduced in any such litigation or other proceeding (the same being privileged
in the same manner as a settlement offer in litigation).
6.19 Counterparts. This Indemnity may be executed in two or more
counterparts, each of which shall for all purposes be deemed to constitute an
original, but all of
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which, when taken together, shall constitute but one instrument, and shall
become effective when copies hereof when taken together, bear the signatures of
each of the signatories hereto.
IN WITNESS WHEREOF, the Indemnitor has executed this Agreement as of
the date first above written:
NORTH TOWER MANAGER LLC ,
a Delaware limited liability company
By: Xxxxxxx Partners-Bunker Hill, Ltd.,
a California limited partnership,
Its Administrative Manager
By: Xxxxxxx Partners BGHS, LLC,
a California limited liability company,
general partner
By:Xxxxxxx Partners SCS, Inc.,
a California corporation,
Its Manager
By:
-----------------------------
Its:
-------------------------
NORTH TOWER MEMBER LLC ,
a Delaware limited liability company
By: Xxxxxxx Partners-Bunker Hill, Ltd.,
a California limited partnership,
Its Administrative Manager
By: Xxxxxxx Partners BGHS, LLC,
a California limited liability company,
general partner
By:Xxxxxxx Partners SCS, Inc.,
a California corporation,
Its Manager
By:
-----------------------------
Its:
-------------------------
D-13
EXHIBIT E
TWELFTH AMENDMENT TO LEASE
(XXXXX FARGO BANK LEASE)
THIS Twelfth Amendment to Lease ("AMENDMENT") is made and entered into
as of the ___ day of June, 2003, by and between NORTH TOWER, LLC, a Delaware
limited liability company (successor to Xxxxxxx Partners-Xxxxxxx Properties
Phase I, a California limited partnership) ("LANDLORD") and XXXXX FARGO BANK,
N.A., a national banking association (successor by merger to Xxxxxxx National
Bank) ("TENANT").
7. RECITALS.
7.1 LEASE. Landlord and Tenant are parties to that certain Office Lease
dated as of May 22, 1980 (the "OFFICE LEASE"), pursuant to which Tenant leases
from Landlord certain premises (the "ORIGINAL PREMISES") situated in the office
building commonly known as 000 Xxxxx Xxxxx Xxxxxx, Xxx Xxxxxxx, Xxxxxxxxxx 00000
(the "BUILDING"). The Office Lease has been amended by a First Amendment of
Xxxxxxx National Bank Office Lease dated as of January 28, 1982, a Letter
Agreement dated January 24, 1983, an Office Lease Amendment dated as of
September 18, 1986, a Fourth Amendment to Xxxxxxx National Bank Office Lease
dated April 15, 1987, a Fifth Amendment to Xxxxxxx National Bank Office Lease
dated as of August 15, 1987, a Sixth Amendment to Xxxxxxx National Bank Office
Lease dated as of August 31, 1987, a Seventh Amendment to Xxxxxxx National Bank
Office Lease dated as of August 1, 1989, an Eighth Amendment to Xxxxxxx National
Bank Office Lease dated as of August 24, 1990, a Ninth Amendment to Xxxxxxx
National Bank Office Lease dated as of December 1, 2000, a Tenth Amendment to
Xxxxxxx National Bank Office Lease dated as of August 28, 2001 and an Eleventh
Amendment to Office Lease dated as of August 26, 2002. The Office Lease, as
amended, is referred to herein as the "LEASE." All terms defined in the Lease
shall have the same meanings when used in this Amendment, unless a different
meaning is clearly expressed herein.
7.2 OPERATING AGREEMENT. North Tower Manager, LLC and North Tower
Member, LLC are the two members of Landlord. Pursuant to the Operating Agreement
of North Tower Manager, LLC ("MANAGER OPERATING AGREEMENT") and the Operating
Agreement of North Tower Member, LLC dated as of April 27, 1998 ("MEMBER
OPERATING AGREEMENT"), Tenant's affiliates are entitled to receive a Xxxxx Fargo
Rent Credit (as defined in Section 4.04.01 of the Manager Operating Agreement
and Section 4.04.01 of the Member Operating Agreement) for each year during the
balance of the initial 30 year term of the Lease.
7.3 PURCHASE/SALE AGREEMENT. Pursuant to the Agreement of Purchase and
Sale of Membership Interests dated as of May 23, 2003 (the "PURCHASE/SALE
AGREEMENT") Tenant's affiliates, Xxxxxxx Grande, Inc. and Xxxxxxx Properties,
Inc. (collectively, "SELLERS") are selling all their rights and interests in
both North Tower Manager, LLC and North Tower Member, LLC, including all rights
in and to the Xxxxx Fargo Rent Credit, to Xxxxxxx Partners-Bunker Hill, Ltd, or
its designee ("BUNKER HILL"). One of the conditions to the Closing (as defined
in Section 1.1
of the Purchase/Sale Agreement) is the execution and delivery of this Amendment
by Landlord and Tenant.
7.4 EFFECTIVE DATE. This Amendment shall become effective (the
"EFFECTIVE DATE") on the latter to occur of (a) the Closing Date, and (b) the
date this Amendment is fully executed and delivered.
7.5 AMENDMENT. The parties hereto desire to amend the Lease to reflect
certain changes in those provisions of the Lease addressing rent credits,
renewal options, Building signage and profits payable to Landlord pursuant to
all subleases of the Tenant's premises and to otherwise modify and amend the
Lease as set forth hereinbelow.
8. AMENDMENT TO LEASE. In consideration for other material covenants
and agreements herein, and for other good and valuable consideration received,
the parties hereby amend the Lease as follows:
8.1 CALCULATION AND PAYMENT OF RENT CREDIT. Landlord shall pay to
Tenant a rent credit (the "RENT CREDIT") of Thirty-Two Thousand Six Hundred
Ninety-Nine Dollars and 36/100 ($32,699.36) per month commencing on [July 1,
2003] and continuing for the balance of the initial term of the Lease, subject
to adjustment as provided herein. The Rent Credit is subject to adjustment as of
the 21st and 26th anniversary dates of the Commencement Date (i.e., June 5, 2003
and June 5, 2008) each an "ADJUSTMENT DATE". If an adjustment is made to the
basic rent payable under this Lease to reflect any increase in the cost of
living, pursuant to Section 4.03 of this Lease, then the annual Rent Credit
shall be increased, effective as of the applicable Adjustment Date, by
twenty-five percent (25%) of the amount by which the basic rent is increased
under Section 4.03. The Rent Credit shall be paid to Tenant monthly at the same
time that Tenant pays the monthly base rent, or, at Tenant's election, such Rent
Credit may be deducted in making payment of the monthly basic rent. In the event
of any abatement of the basic rent during any period in which the Rent Credit is
effective, the Rent Credit shall also xxxxx in a manner proportionate to said
abatement of the basic rent. The Rent Credit replaces the Xxxxx Fargo Rent
Credit that was previously payable to Tenant's Affiliates under the Manager
Operating Agreement and the Member Operating Agreement, which Xxxxx Fargo Rent
Credit is no longer effective.
2.1.1 TERMINATION OF RENT CREDIT. If, pursuant to Section
20.04 of the Lease, Landlord elects to take an assignment of this Lease or to
sublease part of the Premises itself, the Rent Credit shall automatically be
eliminated with respect to the portion of the Premises as to which the Landlord
has elected to take an assignment or to sublease itself. Landlord and Tenant
shall enter into an amendment to this Lease to reflect the elimination of such
portion of the Rent Credit. The Rent Credit shall not be payable during any
extension or renewal term of this Lease.
2.1.2 ASSIGNMENT OF RENT CREDIT. The Rent Credit may not be
assigned, transferred, hypothecated, pledged, encumbered or otherwise alienated
by Tenant; provided, however, notwithstanding anything to the contrary in this
Lease, at the sole option of Tenant, Tenant shall be entitled to assign the
right to receive such Rent Credit to any permitted assignee of this Lease.
2.1.3 PRORATION. If the initial term of this Lease ends on a
day other than the last day of the month, then the Rent Credit for the partial
month during which the termination occurs shall be prorated on the basis of the
actual number of days in said month.
2.1.4 NATURE OF RENT CREDIT. The Rent Credit shall not be
construed as an ownership or equity interest in the Project, any property
encompassed therein or in any entity owning the Project or any such property. In
particular, Tenant shall not be construed or treated as a partner, joint
venturer or other equity owner in the Project for any purpose, including,
without limitation, capital obligations or liability in respect of Project debt
or from Project operations. The Rent Credit shall be treated only as an
adjustment in the rental obligation of Tenant in respect of its leasehold
obligations and interest under this Lease.
8.2 RENEWAL OPTIONS. Section 23.01 of the Lease is hereby deleted and
the following paragraph is inserted in its place:
Provided Tenant is not in default under this Lease (after any
applicable notice and lapse of applicable cure periods) as of
the commencement of a renewal term ("RENEWAL TERM COMMENCEMENT
DATE(S)"), Tenant shall have four (4) successive options to
renew this Lease ("RENEWAL OPTION(S)") for five (5) years each
for a minimum of five (5) contiguous floors of the Premises
and for a maximum of the entire Premises, provided that each
such renewal option, if exercised, must be exercised in full
floor increments. Each Renewal Option is exercisable by giving
written notice thereof ("RENEWAL NOTICE") to Landlord of its
exercise of a Renewal Option at least fifteen (15) months
prior to the expiration of the Term of this Lease (as it may
have been renewed from time to time).
8.3 BUILDING SIGNAGE. Clause 25.02(c) of the Lease (as amended by the
Office Lease Amendment dated as of September 18, 1986 with respect to signage
and Building identity following the merger of Xxxxx Fargo Bank and Xxxxxxx
National Bank) is hereby modified by the insertion of the following paragraph at
the end of Section 25.02 of the Lease:
Notwithstanding anything in Clause 25.02(c) above, Tenant
shall not lose its signage rights under Section 25.1 of this
Lease if, as a result of a merger of Tenant with another
financial institution, Tenant or Tenant's subsidiary owns or
occupies another building with top of the building identity in
downtown Los Angeles (i.e., the area bounded by the Santa
Xxxxxx Freeway, the Harbor Freeway, the Hollywood Freeway and
Hill Street), so long as (i) the total number of buildings
with Tenant's name on the top of the building in downtown Los
Angeles shall not exceed two (2), including the Building, and
(ii) Tenant, or an entity created through a future merger of
Tenant with another entity, or its subsidiary, must have a
major presence in the "other" building (i.e., occupy more than
150,000 rentable square feet), and (iii) Tenant continues
at all times to occupy at least 200,000 rentable square feet
in the Building.
8.4 SUBLEASE PROFITS. Effective as of the date of this Amendment,
Landlord waives its right to receive any portion of the profits received by
Tenant under any sublease of any portion of the Premises.
8.5 AUDITS. In the event Tenant disputes the year-end statement of
actual Operating Expenses provided by Landlord pursuant to Section 5.04 of the
Lease for any calendar year, then Tenant may cause an audit of the Operating
Expenses to be performed by a regionally recognized firm of certified public
accountants on a non-contingency fee basis at Tenant's expense. If such audit
reveals an overpayment of Operating Expenses by Tenant for the calendar year
covered by such year-end statement, then Landlord shall credit the next monthly
rent payment of Tenant in an amount equal to such overpayment, or if the Term
has expired, refund the overpayment to Tenant. If such audit reveals an
underpayment of Operating Expenses by Tenant for the calendar year covered by
such year-end statement, then Tenant shall pay Landlord the underpayment with
Tenant's next monthly rent payment. If such audit reveals an overpayment of
Operating Expenses by Tenant for the calendar year covered by such year-end
statement, then Tenant may offset such overpayment against the next monthly rent
payment. In addition, if it is determined that Landlord's statement overstated
the Operating Expenses by more than five percent (5%), Tenant shall be entitled
to receive from Landlord reimbursement for the actual and reasonable audit
expenses incurred by Tenant in auditing such statement. Tenant's failure to
dispute a year-end statement and conduct an audit of Operating Expenses within
one (1) year after receipt of Landlord's year-end statement for a particular
year shall constitute Tenant's acknowledgement of the accuracy of such
statement.
8.6 AFFILIATE TRANSFERS. Notwithstanding Section 20.01 of the Lease,
Tenant shall have the right, after at least thirty (30) days prior notice
thereof to Landlord, without any requirement for Landlord's consent, to sublease
all or a portion of the Premises, or assign the leasehold granted under this
Lease, to an Affiliate (or a combination of Affiliates) or Successor of Tenant.
For purposes hereof, an "Affiliate" or "Successor" of Tenant is an entity
acquired by Tenant or which acquires Tenant, or an entity controlling, under
common control with or controlled by Tenant, including an entity resulting from
a merger or consolidation by Tenant or from a sale of substantially all of the
assets of Tenant, but excluding, in each case, any entity formed to avoid the
restrictions on Transfer by Tenant under the Lease and excluding any agency or
department of the United States Government. For purposes of such definition, the
word "control," as used above, means with respect to a Person that is
corporation, the right to exercise, directly or indirectly, more than fifty
percent (50%) of the voting rights attributable to the shares of the controlled
corporation and, with respect to a Person that is not a corporation, the
possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of the controlled Person. The word
"Person" means an individual, partnership, trust, corporation, firm or other
entity. Any such Affiliate or Successor of Tenant must expressly assume in
writing a pro rata share of Tenant's obligations hereunder in the proportion
that the number of square feet of Rentable Area of the Premises subleased or
assigned to such Affiliate or Successor of Tenant bears to the total number of
square feet of Rentable Area in the Premises, without relieving Tenant (if
Tenant is the surviving entity) of any liability hereunder.
9. NO BROKER. Each party represents and warrants that it has not had
any contact or dealings with any person or real estate broker which would give
rise to the payment of any fee or brokerage commission in connection with this
Amendment, and such party shall indemnify, defend, protect and hold harmless the
other from and against any liability with respect to any fee or brokerage
commission arising out of any act or omission of the indemnifying party.
10. MISCELLANEOUS.
10.1 LEASE RATIFIED. Except as specifically amended or modified herein,
each and every term, covenant, and condition of this Lease, as amended, is
hereby ratified and remains in full force and effect.
10.2 BINDING AGREEMENT. This Amendment shall be binding upon and inure
to the benefit of the parties hereto, their legal representatives, successors
and permitted assigns.
10.3 GOVERNING LAW. This Amendment shall be interpreted and construed
in accordance with the laws of the State of California.
10.4 COUNTERPARTS. This Amendment may be executed in one or more
counterparts, and each set of duly delivered identical counterparts which
includes all signatories shall be deemed to be one original document.
[signature blocks begin on next page]
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as
of the date first above written.
LANDLORD:
NORTH TOWER, LLC,
a Delaware limited liability company
By: NORTH TOWER MANAGER, LLC,
a Delaware limited liability company
Its Managing Member
By: XXXXXXX PARTNERS-BUNKER HILL, LTD.,
a California limited partnership
Its Administrative Member
By: XXXXXXX PARTNERS BGHS, LLC,
a California limited liability company
Its General Partner
By: XXXXXXX PARTNERS SCS, INC.,
a California corporation
Its Manager
By:
--------------------------------
Name:
--------------------------------
Title:
--------------------------------
TENANT:
XXXXX FARGO BANK, N.A.,
a national banking association
By:
-------------------------------------------------
Name:
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EXHIBIT F-1
FIRST AMENDMENT TO OPERATING
AGREEMENT OF NORTH TOWER MEMBER LLC
This FIRST AMENDMENT TO OPERATING AGREEMENT OF NORTH TOWER
MEMBER LLC ("AMENDMENT") is made as of June ___, 2003, by and between XXXXXXX
PARTNERS - BUNKER HILL, LTD., a California limited partnership ("BUNKER HILL"),
and XXXXXXX PROPERTIES, INC., a California corporation ("PROPERTIES").
R E C I T A L S
X. Xxxxxx Hill, Properties, MAC-WFT, Inc., a Delaware corporation
("MAC-WFT"), and Xxxxxx X. Xxxxxx, Xxxxxx X. Xxxxx and Xxxxxxx X. Xxxxxxx, not
individually, but solely as Trustees under a Declaration of Trust dated January
1, 1986, and known as the Xxxxxx, Xxxx & Xxxxxxxx Revocable Retirement Trust
("GD&C TRUST") entered into that certain Operating Agreement ("MEMBER OPERATING
AGREEMENT") of North Tower Member, LLC, a Delaware limited liability company
("MEMBER LLC") dated as of April 27, 1998.
B. Member LLC owns a 99.5% membership interest in North Tower, LLC,
a Delaware limited liability company ("PROPERTY LLC"). The remaining 0.5%
membership interest in Property LLC is owned by North Tower Manager, LLC, a
Delaware limited liability company ("MANAGER LLC").
X. Xxxxxx Hill has acquired the interests of MAC-WFT and GD&C Trust
in Member LLC and under the Member Operating Agreement. Bunker Hill has sold its
interest in Member LLC and under the Member Operating Agreement to Greenwich
Capital Financial Products, Inc., a Delaware corporation ("GREENWICH").
Immediately prior hereto, Bunker Hill re-acquired such interests from Greenwich.
X. Xxxxxx Xxxx has agreed to acquire the interests of Properties in
Member LLC and under the Member Operating Agreement pursuant to that certain
Agreement of Purchase and Sale of Membership Interests ("PURCHASE AGREEMENT")
dated as of May 23, 2003, by and among Bunker Hill, Properties and Xxxxxxx
Grande, Inc., a California corporation ("GRANDE").
X. Xxxxxx Hill and Properties desire to amend the Member Operating
Agreement as more particularly set forth herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Properties and Bunker Hill do
hereby agree as follows:
1. Effectiveness. The amendments to the Operating Agreement set
forth in this Agreement shall be effective if and only if (i) Bunker Hill has
caused Property LLC, Member LLC and/or Manager LLC to obtain the New Senior Loan
(as defined in the Purchase Agreement); (ii) the New Loan Distribution (as
defined in the Purchase Agreement) has been
made directly or indirectly to any person or entity other than Property LLC,
Manager LLC and/or Member LLC; and (iii) the Closing (as defined in the Purchase
Agreement) has not been consummated on or before the business day following the
date of the New Loan Distribution. In such event, the amendments to the
Operating Agreement set forth herein shall be effective without notice or
further action by any party hereto.
2. Termination. This Amendment shall terminate and shall be of no
further force or effect if the Closing is consummated and Properties and Grande
receive the Purchase Price (as defined in the Purchase Agreement) under the
Purchase Agreement, as adjusted thereunder on or prior to the Closing Date (as
defined in the Purchase Agreement).
3. Amendments. Subject to the effectiveness and the termination
provisions set forth above, Bunker Hill and Properties agree to the following
amendments to the Member Operating Agreement:
(a) Section 4.03 of the Member Operating Agreement is hereby
amended to provide that, prior to any distributions under Section
4.03.01(b), all Net Cash Flow shall be distributed to the Members in
accordance with their then Percentage Interests; provided, however,
that out of the Net Cash Flow to be distributed to Bunker Hill pursuant
to this Paragraph 3(a) there shall first be deducted and distributed to
Properties: (i) an amount which, together with all distributions under
this clause (i), would equal a twelve (12%) percent per annum return on
the unpaid "Special Preferred Return Amount" (as defined below); then
(ii) an amount, up to an amount which, together with all other
distributions under this clause (ii), would equal the "Special
Preferred Return Amount".
Thereafter, all remaining Net Cash Flow shall be distributed in
accordance with the other priorities originally set forth in Section
4.03 of the Member Operating Agreement commencing with Section
4.03.01(b).
The "SPECIAL PREFERRED RETURN AMOUNT" shall mean an amount equal
to 41.79% of the gross proceeds of (a) the New Senior Loan, less (b)
the sum of the following: (i) the actual closing costs and fees of the
New Senior Loan, (ii) the amount required to repay or defease the Xxxxx
Fargo Loan (as defined in the Member Operating Agreement), (iii) the
actual transaction costs associated with the repayment or defeasance of
the Xxxxx Fargo Loan, and (iv) the proceeds of the New Senior Loan used
to establish reserves under the New Senior Loan.
(b) Section 13.03 of the Member Operating Agreement (concerning
liquidating distributions) is hereby amended to provide that, prior to
any distributions under Section 13.03.02, all Net Cash Flow shall first
be distributed to the Members in accordance with their then Percentage
Interests; provided, however, that out of the Net Cash Flow to be
distributed to Bunker Hill pursuant to this Paragraph 3(b) there shall
first be deducted and distributed to Properties: (i) an amount which,
together with all distributions under this Paragraph 3(b)(i) and
Paragraph 3(a)(i), would equal a twelve (12%) percent per annum return
on the unpaid "Special Preferred Return Amount"; then (ii) an amount,
up to an amount which, together with all other distributions under this
Paragraph 3(b)(ii) and Paragraph 3(a)(ii) above, would equal the
"Special Preferred Return Amount".
(c) Notwithstanding anything to the contrary, any net
proceeds of the New Senior Loan, after deduction for (a) the actual
closing costs and fees of the New Senior Loan, (b) the amount required
to repay or defease the Xxxxx Fargo Loan (as defined in the Member
Operating Agreement), (c) the actual transaction costs associated with
the repayment or defeasance of the Xxxxx Fargo Loan, (d) the proceeds
of the New Senior Loan used to establish reserves under the New Senior
Loan, and (e) the amount required to satisfy the Repurchase Facility
(as defined in the Purchase Agreement), shall be used towards payment
of the Special Preferred Return Amount within two (2) business days
following the date of the New Loan Distribution.
(d) Article VI of the Member Operating Agreement is
hereby amended to provide that all members of the Management Committee
shall be appointed by Properties. All other members of the Management
Committee shall be deemed removed from the Management Committee
effective immediately upon the effectiveness of the amendments made
hereunder. Article VI is further amended to provide that,
notwithstanding the approval of the Management Committee (i) Property
LLC shall not sell the Property to an Affiliate (as defined in the
Member Operating Agreement) of Properties without the consent of Bunker
Hill; (ii) Member LLC shall not sell Member LLC's membership interest
in Property LLC to an Affiliate without the consent of Bunker Hill; and
(iii) Properties shall not cause Property LLC or Member LLC to engage
in any transactions with an Affiliate of Properties except upon terms
consistent with an arm's length transaction.
(e) Notwithstanding Section 11.07 of the Member
Operating Agreement, income shall be allocated to Properties to the
extent funds are distributed to Properties in respect of the Special
Preferred Return Amount and the twelve percent (12%) return thereon
under Paragraphs 2(a) and 2(b) above.
4. Counterparts. This Amendment may be executed in one or more
counterparts, each of which shall, when taken together, constitute one
agreement.
5. Reaffirmation. In all other respects, the Member Operating Agreement
shall remain as originally stated and are hereby reaffirmed and confirmed.
6. Governing Law. This Amendment shall be construed in accordance with
the laws of the State of Delaware.
IN WITNESS WHEREOF, Bunker Hill and Properties do hereby enter into
this Amendment as of the date first written above.
PROPERTIES: XXXXXXX PROPERTIES INC.,
a California corporation
By:
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Name:
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Title:
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By:
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Name:
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Title:
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BUNKER HILL: XXXXXXX PARTNERS-BUNKER HILL, LTD., a California
limited partnership
By: Xxxxxxx Partners BGHS, LLC,
a California limited liability company,
general partner
By: Xxxxxxx Partners SCS, Inc., a
California corporation,
Its Manager
By:
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Its:
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EXHIBIT F-2
FIRST AMENDMENT TO OPERATING
AGREEMENT OF NORTH TOWER MANAGER LLC
This FIRST AMENDMENT TO OPERATING AGREEMENT OF NORTH TOWER
MANAGER LLC ("AMENDMENT") is made as of June ___, 2003, by and between XXXXXXX
PARTNERS - BUNKER HILL, LTD., a California limited partnership ("BUNKER HILL"),
and XXXXXXX GRANDE, INC., a California corporation ("GRANDE").
R E C I T A L S
X. Xxxxxx Hill, Grande, MAC-WFT, Inc., a Delaware corporation
("MAC-WFT"), and Xxxxxx X. Xxxxxx, Xxxxxx X. Xxxxx and Xxxxxxx X. Xxxxxxx, not
individually, but solely as Trustees under a Declaration of Trust dated January
1, 1986, and known as the Xxxxxx, Xxxx & Xxxxxxxx Revocable Retirement Trust
("GD&C TRUST") entered into that certain Operating Agreement ("MANAGER OPERATING
AGREEMENT") of North Tower Manager, LLC, a Delaware limited liability company
("MANAGER LLC") dated as of April 27, 1998.
B. Manager LLC owns a 0.5% membership interest in North Tower, LLC, a
Delaware limited liability company ("PROPERTY LLC"). The remaining 99.5%
membership interest in Property LLC is owned by North Tower Member, LLC, a
Delaware limited liability company ("MEMBER LLC").
X. Xxxxxx Hill has acquired the interests of MAC-WFT and GD&C Trust in
Manager LLC and under the Manager Operating Agreement. Bunker Hill has sold its
interest in Manager LLC and under the Manager Operating Agreement to Greenwich
Capital Financial Products, Inc., a Delaware corporation ("GREENWICH").
Immediately prior hereto, Bunker Hill re-acquired such interests from Greenwich.
X. Xxxxxx Xxxx has agreed to acquire the interests of Grande in Manager
LLC and under the Manager Operating Agreement pursuant to that certain Agreement
of Purchase and Sale of Membership Interests ("PURCHASE AGREEMENT") dated as of
May 23, 2003, by and among Bunker Hill, Grande and Xxxxxxx Properties, Inc., a
California corporation ("PROPERTIES").
X. Xxxxxx Hill and Grande desire to amend the Manager Operating
Agreement as more particularly set forth herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Grande and Bunker Hill do hereby
agree as follows:
1. Effectiveness. The amendments to the Operating Agreement set forth
in this Agreement shall be effective if and only if (i) Bunker Hill has caused
Property LLC, Manager LLC and/or Member LLC to obtain the New Senior Loan (as
defined in the Purchase Agreement); (ii) the New Loan Distribution (as defined
in the Purchase Agreement) has been made directly or indirectly to any person or
entity other than Property LLC, Manager LLC and/or
A-1
Member LLC; and (iii) the Closing (as defined in the Purchase Agreement) has not
been consummated on or before the business day following the date of the New
Loan Distribution. In such event, the amendments to the Operating Agreement set
forth herein shall be effective without notice or further action by any party
hereto.
2. Termination. This Amendment shall terminate and shall be of no
further force or effect if the Closing is consummated and Grande and Properties
receive the Purchase Price (as defined in the Purchase Agreement) under the
Purchase Agreement, as adjusted thereunder on or prior to the Closing Date (as
defined in the Purchase Agreement).
3. Amendments. Subject to the effectiveness and the termination
provisions set forth above, Bunker Hill and Grande agree to the following
amendments to the Manager Operating Agreement:
(a) Section 4.03 of the Manager Operating Agreement is hereby
amended to provide that, prior to any distributions under Section
4.03.01(b), all Net Cash Flow shall be distributed to the Members in
accordance with their then Percentage Interests; provided, however,
that out of the Net Cash Flow to be distributed to Bunker Hill pursuant
to this Paragraph 3(a) there shall first be deducted and distributed to
Grande: (i) an amount which, together with all distributions under this
clause (i), would equal a twelve (12%) percent per annum return on the
unpaid "Special Preferred Return Amount" (as defined below); then (ii)
an amount, up to an amount which, together with all other distributions
under this clause (ii), would equal the "Special Preferred Return
Amount".
Thereafter, all remaining Net Cash Flow shall be distributed in
accordance with the other priorities originally set forth in Section
4.03 of the Manager Operating Agreement commencing with Section
4.03.01(b).
The "SPECIAL PREFERRED RETURN AMOUNT" shall mean an amount equal to
0.21% of the gross proceeds of (a) the New Senior Loan, less (b) the
sum of the following: (i) the actual closing costs and fees of the New
Senior Loan, (ii) the amount required to repay or defease the Xxxxx
Fargo Loan (as defined in the Manager Operating Agreement), (iii) the
actual transaction costs associated with the repayment or defeasance of
the Xxxxx Fargo Loan, and (iv) the proceeds of the New Senior Loan used
to establish reserves under the New Senior Loan.
(b) Section 13.03 of the Manager Operating Agreement (concerning
liquidating distributions) is hereby amended to provide that, prior to
any distributions under Section 13.03.02, all Net Cash Flow shall first
be distributed to the Members in accordance with their then Percentage
Interests; provided, however, that out of the Net Cash Flow to be
distributed to Bunker Hill pursuant to this Paragraph 3(b) there shall
first be deducted and distributed to Grande: (i) an amount which,
together with all distributions under this Paragraph 3(b)(i) and
Paragraph 3(a)(i), would equal a twelve (12%) percent per annum return
on the unpaid "Special Preferred Return Amount"; then (ii) an amount,
up to an amount which, together with all other distributions under this
Paragraph 3(b)(ii) and Paragraph 3(a)(ii) above, would equal the
"Special Preferred Return Amount".
(c) Notwithstanding anything to the contrary, any net proceeds of
the New Senior Loan, after deduction for (a) the actual closing costs
and fees of the New Senior Loan, (b) the amount required to repay or
defease the Xxxxx Fargo Loan (as defined in the Manager Operating
Agreement), (c) the actual transaction costs associated with the
repayment or defeasance of the Xxxxx Fargo Loan, (d) the proceeds of
the New Senior Loan used to establish reserves under the New Senior
Loan, and (e) the amount required to satisfy the Repurchase Facility
(as defined in the Purchase Agreement), shall be used towards payment
of the Special Preferred Return Amount within two (2) business days
following the date of the New Loan Distribution.
(d) Article VI of the Manager Operating Agreement is hereby amended
to provide that all members of the Management Committee shall be
appointed by Grande. All other members of the Management Committee
shall be deemed removed from the Management Committee effective
immediately upon the effectiveness of the amendments made hereunder.
Article VI is further amended to provide that, notwithstanding the
approval of the Management Committee (i) Property LLC shall not sell
the Property to an Affiliate (as defined in the Manager Operating
Agreement) of Grande without the consent of Bunker Hill; (ii) Manager
LLC shall not sell Manager LLC's membership interest in Property LLC to
an Affiliate without the consent of Bunker Hill; and (iii) Grande shall
not cause Property LLC or Manager LLC to engage in any transactions
with an Affiliate of Grande except upon terms consistent with an arm's
length transaction.
(e) Notwithstanding Section 11.07 of the Manager Operating
Agreement, income shall be allocated to Grande to the extent funds are
distributed to Grande in respect of the Special Preferred Return Amount
and the twelve percent (12%) return thereon under Paragraphs 2(a) and
2(b) above.
4. Counterparts. This Amendment may be executed in one or more
counterparts, each of which shall, when taken together, constitute one
agreement.
5. Reaffirmation. In all other respects, the Manager Operating
Agreement shall remain as originally stated and are hereby reaffirmed and
confirmed.
6. Governing Law. This Amendment shall be construed in accordance with
the laws of the State of Delaware.
IN WITNESS WHEREOF, Bunker Hill and Grande do hereby enter
into this Amendment as of the date first written above.
GRANDE: XXXXXXX GRANDE INC.,
a California corporation
By:
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Name:
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Title:
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By:
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Name:
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Title:
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BUNKER HILL: XXXXXXX PARTNERS-BUNKER HILL, LTD., a California
limited partnership
By: Xxxxxxx Partners BGHS, LLC,
a California limited liability company,
general partner
By: Xxxxxxx Partners SCS, Inc., a
California corporation,
Its Manager
By:
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Its:
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