EXHIBIT 1
PURCHASE AND SECURITY AGREEMENT
THIS PURCHASE AND SECURITY AGREEMENT is made and entered into as of the 4th
day of October, 2001 by and between the entity and individuals set forth in
EXHIBIT A (the "XXXXXXX GROUP"), and the entities and individuals set forth on
EXHIBIT B attached hereto (the "XXXXX GROUP"), with respect to 4,013 limited
partnership units of Sierra Pacific Development II, a ___________ limited
partnership (the "PARTNERSHIP").
RECITALS
A. The Partnership is engaged in the ownership and leasing of real property
(the "BUSINESS").
B. The Partnership is included in a Form S-4 that has been filed with the
SEC by American Spectrum Realty, Inc. (the "FORM S-4") to roll up a series of
real estate limited partnerships (the "ROLL-UP").
X. XXXXXXX GROUP and XXXXX GROUP are owners of limited partnership units in
the Partnership.
X. XXXXXXX GROUP owns a direct or indirect interest in CGS Real Estate
Company, Inc., a Texas corporation, the general partner of the Partnership.
X. XXXXX GROUP desires to sell to XXXXXXX GROUP, and XXXXXXX GROUP desires
to purchase from XXXXX GROUP, 4,013 limited partnership units in the Partnership
(the "UNITS"), subject to and in accordance with the terms and conditions set
forth herein.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing, the mutual covenants
contained herein and other good and valuable consideration the sufficiency of
which is hereby acknowledged, the parties agree as follows:
1. SALE OF THE UNITS AND PURCHASE PRICE. Subject to the terms and
conditions of this Agreement, XXXXX GROUP hereby agrees to sell, transfer,
convey, assign and deliver to XXXXXXX GROUP, and XXXXXXX GROUP hereby agrees to
purchase from XXXXX GROUP, the Units for a purchase price of $204 per Unit, or
an aggregate of $818,652, payable as follows:
(a) $481,560 payable upon the execution of this Agreement; and
(b) $337,092 in the form of a Note payable in full no later than
December 27, 2001, together with an irrevocable assignment of the Litigation
Proceeds which may be used as payment against the Note if paid prior to December
27, 2001. For purposes of this Agreement, "Litigation Proceeds" shall mean the
$84 per Unit to be paid to each holders of units of limited partnership in the
Partnership further described in the Form S-4. In the event that the Litigation
Proceeds are not paid in full prior to December 27, 2001, XXXXXXX GROUP shall
pay $337,092 to XXXXX GROUP on December 27, 2001 by cashier's check or wired
funds, less any part of the Litigation Proceeds received by XXXXX GROUP, and
XXXXX GROUP shall cancel and return the irrevocable assignment of the Litigation
Proceeds to XXXXXXX GROUP.
2. GRANT OF SECURITY INTEREST AND ESCROW OF UNITS. XXXXXXX GROUP hereby
grants to XXXXX GROUP a security interest in the Units to secure payment by
XXXXXXX GROUP of the Note and payment of the exercise price of the Put, if any,
and agrees that the assignment of the Units from XXXXX GROUP to XXXXXXX GROUP
shall be deposited in an escrow pursuant to an Escrow Agreement in the form
attached as EXHIBIT C until the later of (i) full payment of the Note or (ii)
expiration of the Put unexercised or full payment for any AQQ Shares exercised
under the Put.
3. GRANT OF PROXY COUPLED WITH AN INTEREST. XXXXX GROUP hereby grants to
XXXXXXX GROUP a proxy coupled with an interest to vote or consent with respect
to the Units.
4. REPRESENTATIONS AND WARRANTIES OF XXXXXXX GROUP. To induce XXXXX GROUP
to enter into this Agreement and to perform XXXXX GROUP's obligations hereunder,
XXXXXXX GROUP represents and warrants the truth, accuracy and completeness of
the following:
(c) ENFORCEABILITY. This Agreement has been duly executed and
delivered by XXXXXXX GROUP and constitutes a legal, valid and binding obligation
of XXXXXXX GROUP, enforceable against XXXXXXX GROUP in accordance with its
terms, subject to or limited by bankruptcy, insolvency, reorganization,
arrangement, moratorium, or other similar laws relating to or affecting the
rights of creditors generally.
(d) INVESTMENT INTENT. XXXXXXX GROUP is acquiring the Units for his
own account, and not with any present intention of distributing or selling the
Units or any part thereof.
(e) ACCESS TO INFORMATION. XXXXXXX GROUP acknowledges that he owns and
has owned limited partnership units of the Partnership since ________ and has
access to information about the Partnership. Furthermore XXXXXXX GROUP
acknowledges that such materials were prepared by the Partnership and XXXXX
GROUP has no responsibility for the accuracy or adequacy of such materials.
(f) SUITABILITY. XXXXXXX GROUP represents and warrants that XXXXXXX
GROUP: (i) can bear the economic risk of the purchase of the Units including the
total loss of XXXXXXX GROUP's investment; and (ii) has such knowledge and
experience in business and financial matters as to be capable of evaluating the
merits and risks of an investment in the Units, or that XXXXXXX GROUP is being
advised by others (acknowledged by XXXXXXX GROUP as his Representative(s), such
that they and XXXXXXX GROUP together are capable of making such evaluation.
(g) POWER AND AUTHORITY. XXXXXXX GROUP has the right , power and
authority to execute this Agreement and to consummate the transactions
contemplated hereby. Xxxx X. Xxxxxxx has the power and authority to execute this
Agreement together with its exhibits, on behalf of XXXXXXX GROUP.
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5. REPRESENTATIONS AND WARRANTIES OF XXXXX GROUP. To induce XXXXXXX GROUP
to enter into this Agreement and to perform XXXXXXX GROUP's obligations
hereunder, XXXXX GROUP represents and warrants the truth, accuracy and
completeness of the following:
(a) OWNERSHIP OF UNITS. XXXXX GROUP has good and marketable title to,
and rightful possession of all of the Units, and each and all of the Units are
free and clear of all liens, claims, rights, charges, encumbrances and security
interests of whatsoever nature or type.
(b) POWER AND AUTHORITY. XXXXX GROUP has the right, power and
authority to execute and deliver this Agreement and to consummate the
transactions contemplated hereby and Xxxxx Xxxxx has the authority to execute
this agreement on behalf of the XXXXX GROUP.
(c) ENFORCEABILITY. This Agreement has been duly executed and
delivered by XXXXX GROUP and constitutes a legal, valid and binding obligation
of XXXXX GROUP, enforceable against XXXXX GROUP in accordance with its terms,
subject to or limited by bankruptcy, insolvency, reorganization, arrangement,
moratorium, or other similar laws relating to or affecting the rights of
creditors generally.
6. XXXXXXX GROUP'S DELIVERIES. XXXXXXX GROUP shall have executed and
delivered to XXXXX GROUP all of the following:
(a) PAYMENT OF CONSIDERATION. A cashier's check in the amount of
$481,560 made out to Xxxxx Xxxxx.
(b) ASSIGNMENT. An irrevocable assignment of the Litigation Proceeds,
in the form attached hereto as EXHIBIT D.
(c) NOTE. A note in the form attached as EXHIBIT E (the "Note").
(d) ESCROW AGREEMENT. An Escrow Agreement in the form attached as
EXHIBIT C.
7. XXXXX GROUP'S DELIVERIES. XXXXX GROUP shall have executed and delivered
the following:
(a) ESCROW AGREEMENT. To Escrow Agent set forth in the Escrow
Agreement an assignment in the form attached as EXHIBIT F, assigning the Units
from XXXXX GROUP to XXXXXXX GROUP.
(b) PROXY. To XXXXXXX GROUP a proxy coupled with an interest in the
form attached as EXHIBIT G
8. BROKER'S FEE. Neither XXXXX GROUP nor XXXXXXX GROUP will or has paid a
fee to any third party in connection with the sale of the Units from XXXXX GROUP
to XXXXXXX GROUP.
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9. ENTIRE AGREEMENT. This Agreement, the exhibits hereto and that certain
Put and Call Agreement of even date by and between XXXXX GROUP and XXXXXXX GROUP
constitute the entire agreement between the parties with respect to the purchase
of the Units and shall be binding upon and inure to the benefit of the parties
hereto and their respective legal representatives successors and permitted
assigns. Each exhibit shall be considered incorporated into this Agreement. This
Agreement may not be amended, modified, supplemented or otherwise altered in any
respect except by an agreement in writing signed by the parties hereto. This
Agreement supersedes all prior written or oral agreements between XXXXXXX GROUP
and Shareholder.
10. WAIVERS. The failure in any one or more instances of a party to insist
upon performance of any of the terms, covenants or conditions of this Agreement,
to exercise any right or privilege conferred in this Agreement or the waiver by
said party of any breach of any of the terms, covenants or conditions of this
Agreement, shall not be construed as a subsequent waiver of any such terms,
covenants, conditions, rights or privileges, but the same shall continue and
remain in full force and effect as if no such forbearance or waiver had
occurred. No waiver shall be effective unless it is in writing and signed by an
authorized representative of the waiving party. A breach of any representation,
warranty or covenant shall not be affected by the fact that a more general or
more specific representation, warranty or covenant was not also breached.
11. COUNTERPARTS. This Agreement may be executed in multiple counterparts,
each of which shall be deemed to be an original, and all such counterparts shall
constitute but one instrument.
12. SEVERABILITY. The invalidity of any provision of this Agreement or
portion of a provision shall not affect the validity of any other provision of
this Agreement or the remaining portion of the applicable provision.
13. APPLICABLE LAW. This Agreement and all questions relating to its
validity, interpretation, performance and enforcement, shall be governed by and
construed, interpreted and enforced in accordance with the laws of the State of
Arizona without regard to conflicts of laws or provisions thereof to the
contrary. The parties agree that any action brought by either party against the
other in connection with any rights or obligations arising out of this Agreement
or any transaction contemplated hereby shall be instituted properly in an
Arizona court of competent jurisdiction with venue only in Maricopa County. The
parties hereby agree to submit personally to the jurisdiction of a court of
competent subject matter jurisdiction located in such state. In any action or
proceeding to enforce rights under this Agreement, the prevailing party shall be
entitled to recover costs and attorneys' fees.
14. CONSTRUCTION. The parties hereto acknowledge and agree that each party
has participated in the drafting of this Agreement and that this document has
been reviewed by the respective legal counsel for the parties hereto and that
the normal rule of construction to the effect that any ambiguities are to be
resolved against the drafting party shall not be applied to the interpretation
of this Agreement. No inference in favor of, or against, any party shall be
drawn from the fact that one party has drafted any portion hereof.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
XXXXXXX GROUP: XXXXX GROUP:
/s/ Xxxx X. Xxxxxxx /s/ Xxxxx Xxxxx
----------------------------- -----------------------------
Xxxx X. Xxxxxxx Xxxxx Xxxxx,
Authorized Representative
/s/ Xxxxxxx X. Xxxxxx
-----------------------------
Xxxxxxx X. Xxxxxx
CGS Real Estate Company, Inc.,
a Texas corporation
_____________________________
By:__________________________
Its:_________________________
EXHIBITS:
---------
X. Xxxxxxx Group
X. Xxxxx Group
C. Escrow Agreement
D. Irrevocable Assignment of Litigation Proceeds
E. Note
F. Assignment of Units
G. Proxy Coupled with an Interest
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EXHIBIT A
THE XXXXXXX GROUP
Xxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxx
CGS Real Estate Company, Inc., a Texas corporation
Exhibit A-1
EXHIBIT B
THE XXXXX GROUP
UNITS
-----
Prizm Investment 43
Xxxxx Xxxxx CPA PC
Money Purchase Pension Plan 100
Baseline Investment 2,185
Xxx Xxxxxx 136
Xxxxxx Hintzin 168
Paradise Wire & Cable 68
Sunshine Wire & Cable 195
Hereford Associates 396
Bridle Associates 8
Xxxxxxxx Xxxxxx 714
------
4,013
Exhibit B-1
EXHIBIT C
ESCROW AGREEMENT
October 4, 2001
Arizona Escrow & Financial Corporation
0000 Xxxxx 00xx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
Attention: Mr. Xxx Xxxxxx
RE: Escrow Number _____________
Dear Xx. Xxxxxx:
Your firm has agreed to act as the escrow agent (the "Escrow Agent") in
connection with the transactions contemplated by and pursuant to the provisions
of that certain Purchase and Security Agreement, dated as of October 4, 2001
(the "Purchase Agreement"), among the Xxxxxxx Group the members of which are set
forth on EXHIBIT A and which is represented by Xxxx X. Xxxxxxx ("Purchaser"),
and the Xxxxx Group the members of which are set forth on EXHIBIT A hereto and
which is represented by Xxxxx Xxxxx ("Seller"). Terms defined in the Purchase
Agreement shall have the same meaning when used herein.
Concurrent with the execution of this Agreement, Seller has deposited with
the Escrow Agent an assignment of 4,013 limited partnership units of Sierra
Pacific Development Fund II, L.P. (the "Partnership") from the Xxxxx Group to
the Xxxxxxx Group (the "Assignment") and has issued directions to the
Partnership to issue any and all AQQ Shares issued in exchange for the Units
(the"AQQ Shares") to be sent to your firm to be added to the escrow account.
Escrow Agent acknowledges receipt of the Assignment. Escrow Agent shall
hold the Assignment and the AQQ Shares in accordance with the terms of this
Agreement.
Within two business days of written notification of payment of the Note and
either (i) payment of any sums due under the Put from Purchaser to Seller or
(ii) that the Put has expired unexercised, Escrow Agent shall notify Seller of
receipt of such notice by facsimile. Within five business days from receipt of
such notification by Seller, Seller shall notify Escrow Agent if Seller has any
dispute with Purchaser's notification of payment. Seller's notice of such
dispute shall certify that payment under the Note or Put Agreement or both has
not been made, or that the Put has not expired unexercised. Unless Seller
provides the notice referred to in this paragraph within the time period set
forth, Escrow Agent shall immediately release the Assignment and the AQQ Shares
to Purchaser. If the AQQ shares have not yet been issued to the Escrow Agent ,
the Escrow shall deliver to the Partnership a notice that the AQQ shares issued
in exchange for the Units shall be sent to Purchaser.
Exhibit C-1
Unless terminated earlier pursuant to the terms of this Agreement, this
Agreement shall terminate on full payment of the Note and expiration of the Put
unexercised and delivery of the Assignment and AQQ shares in accordance with
this Agreement.
In the event that any other claim or claims are made against Escrow Agent
or if there is any other dispute in respect of this Agreement, Escrow Agent
shall have the power and authority, in its sole discretion, to hold the
Assignment and the AQQ Shares until such claims are resolved, either through
judicial process or otherwise, and/or to file an interpleader action with
respect to such claim or claims in any court of competent jurisdiction.
Escrow Agent shall have no duties or obligations except as set forth in
this Escrow Agreement, and Escrow Agent shall not be required to take any action
or actions other than in accordance with the terms hereof.
Purchaser and Seller each severally agree to indemnify and hold Escrow
Agent harmless from and against the full amount of any and all claims, costs,
damages, judgments, fees, expenses, obligations, taxes, assessments,
liabilities, actions, suits, or charges, including reasonable attorneys' fees
and expenses, made against Escrow Agent or incurred by Escrow Agent by reason of
any act or omission to act by Escrow Agent hereunder or in connection with any
of the transactions referred to herein or contemplated hereby, other than as a
result of Escrow Agent's gross negligence or willful misconduct.
Purchaser and Seller are beneficiaries to this Escrow Agreement, and its
terms may not be changed without their written consent.
Your fees for this transaction shall be the sum of $________ and shall be
paid in full upon the opening of escrow.
Exhibit C-2
Please acknowledge your agreement to the foregoing terms and provisions by
executing the enclosed copy of this Escrow Agreement and returning it to the
undersigned.
XXXXXXX GROUP: XXXXX GROUP:
/s/ Xxxx X. Xxxxxxx /s/ Xxxxx Xxxxx
----------------------------- -----------------------------
Xxxx X. Xxxxxxx Xxxxx Xxxxx,
Authorized Representative
/s/ Xxxxxxx X. Xxxxxx
-----------------------------
Xxxxxxx X. Xxxxxx
CGS Real Estate Company, Inc.,
a Texas corporation
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------
Its: President
Accepted this 4th day of October, 2001
By:__________________________
Name:_____________________
Title:____________________
Exhibit C-3
EXHIBIT D
IRREVOCABLE ASSIGNMENT OF BENEFICIAL INTEREST IN LITIGATION PROCEEDS.
In consideration of the mutual promises set forth herein, in that certain
Purchase and Security Agreement (the "Purchase Agreement") to which this
Irrevocable Assignment of Beneficial Interest in Litigation Proceeds (the
"Assignment") is an Exhibit and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the XXXXXXX GROUP, as
that term is defined in the Purchase Agreement hereby (i) grants, conveys,
bargains, assigns, sells, transfers and sets over unto XXXXX GROUP, all of
XXXXXXX'x rights title and interest to the Litigation Proceeds in connection
with 4,013 units of limited partnership in Sierra Pacific Development Fund II,
L.P., as that term is defined in the Purchase Agreement and (ii) instructs the
Sierra Pacific Development Fund II, L.P. to pay such Litigation Proceeds
directly to XXXXX GROUP at _____________________________, Phoenix, Arizona
850__.
XXXXXXX GROUP does hereby make, constitute and appoint XXXXX GROUP its true
and lawful attorney, irrevocably, in its name, or otherwise, and at XXXXXXX
GROUP's sole cost and expense, to use and take all lawful ways and means to
enforce XXXXXXX GROUP's rights under this Assignment
XXXXXXX GROUP does hereby represent, warrant and covenant to XXXXX GROUP
that (i) Xxxx X. Xxxxxxx on behalf of XXXXXXX GROUP has and shall continue to
have all requisite right, power and authority to enter into this Agreement and
any other documents contemplated hereby and to perform it obligations hereunder:
(ii) the execution and delivery of this Assignment and XXXXXXX GROUP's
performance of his obligations hereunder do not and shall not, by the lapse of
time, the giving of notice, or otherwise, constitute a violation or breach of
any provision contained in any agreement, instrument or document to which
XXXXXXX GROUP or any member of XXXXXXX GROUP is now a party or by which XXXXXXX
GROUP or any member of XXXXXXX GROUP is bound, or constitute a violation of any
law, rule, regulation, ordinance, governmental approval, permit, certificate,
inspection, consent or franchise material to this Assignment, including but not
limited to the Sierra Pacific Development Fund II, limited partnership
agreement: (iii) XXXXXXX GROUP and each member thereof holds its rights to the
Litigation Proceeds free and clear from all liens, claims, charges,
encumbrances, security interests or assignments; (iv) XXXXXXX GROUP and each
member thereof has not previously assigned, pledged, encumbered or otherwise
disposed of his rights to the Litigation Proceeds: (v) to the extent that any
third party makes a claim or demand alleging an interest in the Litigation
Proceeds, which interest was purportedly granted by XXXXXXX GROUP, XXXXXXX GROUP
jointly and severally with each member thereof will indemnify, defend and hold
XXXXX GROUP harmless with respect to such claim or demand; (vi) XXXXXXX GROUP's
interest and the interest of each member thereof in the Litigation Proceeds is
free from dispute, set offs, counter claims and defenses and (vii) XXXXXXX GROUP
and each member thereof has not extended modified or amended its rights to the
Litigation Proceeds, or made any compromise, adjustment, settlement or
termination in connection therewith.
This Assignment shall terminate and be of no force and effect if XXXXXXX
GROUP makes the payment pursuant to Section 1(b) of the Purchase Agreement.
Exhibit D-1
In witness whereof, XXXXXXX GROUP has executed this Assignment on this 4th
day of October, 2001.
XXXXXXX GROUP:
/s/ Xxxx X. Xxxxxxx
--------------------------------
Xxxx X. Xxxxxxx
/s/ Xxxxxxx X. Xxxxxx
--------------------------------
Xxxxxxx X. Xxxxxx
CGS Real Estate Company, Inc.,
a Texas corporation
By: /s/ Xxxxxxx X. Xxxxxx
----------------------------
Its: President
ACKNOWLEDGEMENT BY SIERRA PACIFIC DEVELOPMENT FUND II, L.P.:
The undersigned has read the foregoing and acknowledges the irrevocable
assignment of rights in the Litigation Proceeds.
Sierra Pacific Development
Fund II, L.P.
________________________________
By:_____________________________
Its:____________________________
Exhibit D-2
EXHIBIT E
PROMISSORY NOTE
$337,092 October 4, 0000
Xxxx X. Xxxxxxx, Xxxxxxx X. Xxxxxx and CGS Real Estate Company, Inc., a Texas
corporation, jointly and severally, ("Maker") promise to pay to the order of
Xxxxx Xxxxx, a resident of Arizona ("Payee"), the principal amount of THREE
HUNDRED THIRTY SEVEN THOUSAND, NINETY TWO AND 00/100 Dollars ($337,092),
together with any interest on the unpaid principal balance at the interest rate
per annum, and on the dates set forth herein.
Maker will repay the principal balance, together with any interest at the
interest rate described below, in one payment in the full principal amount of
this Note on the earlier of the payment of the Litigation Proceeds by Sierra
Pacific Development II, L.P. or December 27, 2001.
Maker will make all payments in United States Dollars to Payee at X.X. Xxx
00000, Xxxxxxx, Xxxxxxx 00000, or to another address that Payee requests in
writing. All payments will be made in immediately available funds.
This Note is executed in connection with that certain Purchase and Security
Agreement of even date herewith (the "Purchase Agreement"), between Maker and
Payee. All of the terms contained in the Purchase Agreement are incorporated in
full herein as if the Purchase Agreement was set forth in its entirety. This
Note may be prepaid in whole or in part. This Note may be accelerated by Payee
upon a payment default or upon any other default under the Purchase Agreement or
any agreement, instrument or document executed in connection herewith or
therewith which is not cured within 10 days after written notice thereof is
given to member of Maker (an "Event of Default").
TIME IS OF THE ESSENCE WITH REGARD TO THIS NOTE AND EACH AND EVERY PROVISION
HEREOF.
This Note shall not bear interest unless there has been an Event of Default.
Should an Event of Default occur, the entire outstanding principal amount of
this Note shall become immediately due and payable and Maker will also pay Payee
default interest of eighteen percent (18%) per annum on the principal amount
past due over the period beginning on the date of this Note and ending upon
payment in full of the principal amount hereunder. Maker will also pay all of
Payee's costs of collection, including Payee's reasonable attorney's fees and
expenses.
Except as otherwise set forth in the Purchase Agreement or in this Note, to the
extent permitted by law Maker waives and agrees not to assert or demand
diligence, grace, presentment for payment, formalities of demand, protest or
notice of nonpayment or dishonor, nonperformance, extension, maturity, default
or any other notice as to this Note.
Exhibit E-1
No delay or failure of Payee in exercising any right hereunder or under the
Purchase Agreement shall affect such right, nor shall any single or partial
exercise of any right preclude further exercise thereof.
This Note shall be construed in accordance with and governed by the laws of the
State of Arizona, without regard to the choice of law rules of the State of
Arizona.
No amendment, modification change, waiver, release or discharge hereof and
hereunder shall be effective unless evidenced by an instrument in writing and
signed by the party against whom enforcement is sought.
The provisions of this Note shall be binding upon and inure to the benefit of
Maker and Payee and their respective successors and assigns, as applicable.
The language of this Note shall be construed as a whole according to its fair
meaning. No inference in favor of, or against, Maker or Payee shall be drawn
from the fact that one party has drafted any portion hereof.
IN WITNESS WHEREOF, Debtor has executed this Note as of the date first set
forth above.
/s/ Xxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxx
------------------------------- -------------------------------
Xxxx X. Xxxxxxx Xxxxxxx X. Xxxxxx
CGS Real Estate Company, Inc.,
a Texas corporation
By: /s/ Xxxxxxx X. Xxxxxx
----------------------------
Its: President
Exhibit E-2
EXHIBIT F
ASSIGNMENT OF UNITS
In exchange for the consideration set forth in the Purchase and Sale
Agreement dated as of October 4, 2001, by and between the Xxxxxxx Group and the
Xxxxx Group (the "Purchase Agreement"), the receipt and sufficiency of which is
hereby acknowledged, each of the undersigned Assignors hereby assigns, transfers
and conveys to Xxxx Xxxxxxx (the "Assignee") their entire right, title and
interest in and to ___ limited partnership interests assigned by them pursuant
to the Purchase Agreement (the "Interests") in Sierra Pacific Development Fund
II (the "Partnership"), including without limitation, all rights to receive
distributions of money, profits, securities and other assets from or relating to
the Interests, presently existing or hereafter arising or accruing, except for
the Litigation Proceeds as that term is defined in the Purchase Agreement,
unless the Xxxxxxx Group has made the payment pursuant to Section ___ of the
Purchase Agreement in which case Xxxx Xxxxxxx shall be entitle to the
distribution of the Litigation Proceeds, TO HAVE AND TO HOLD the same unto the
Assignee, its successors and assigns, forever. Assignee hereby assumes all
obligations in respect of the Interest arising after the date hereof.
Assignors do hereby represent, warrant and covenant to Assignee that (i)
Assignors have and shall continue to have all requisite right, power and
authority to enter into this Agreement and any other documents contemplated
hereby and to perform their obligations hereunder; (ii) the execution and
delivery of this Assignment and Assignors' performance of these obligations
hereunder do not and shall not, by the lapse of time, the giving of notice, or
otherwise, constitute a violation or breach of any provision contained in any
agreement, instrument or document to which Assignors are now a party or by which
Assignors are bound, or constitute a violation of any law, rule, regulation,
ordinance, governmental approval, permit, certificate, inspection, consent or
franchise material to this Assignment; (iii) Assignors hold the Interests free
and clear from all liens, claims, charges, encumbrances, security interests or
assignments; (iv) Assignors have not previously assigned, pledged, encumbered or
otherwise disposed of their rights to the Interests; (v) to the extent that any
third party makes a claim or demand alleging an interest in the Interests, which
interest was purportedly granted by Assignors, Assignors will indemnify, defend
and hold Assignee harmless with respect to such claim or demand, provided that
Assignors have been given adequate notice by Assignee of such claim or demand so
as not to predjudice Assignors' defenses against such claim or demand and
Assignors have been given the right and opportunity by Assignee to defend
against such claim or demand; and (vi) Assignors' interest in the Interests is
free from dispute, set offs, counter claims and defenses.
By signing and delivering this Assignment, the Assignors irrevocably
appoint Assignee and Assignee's designees as the Assignors' proxies, with full
power of substitution, to the full extent of such Assignors' rights, with
respect to the Assignors' Interests. All prior proxies given by the Assignors
with respect to such Interests are hereby revoked without further action, and no
subsequent proxies may be given with respect to such Interests nor any
subsequent written consent signed with respect to such Interests (and, if given
Exhibit F-1
or signed, will not be deemed effective). Pursuant to such proxy, Assignee and
its designees will be empowered to exercise all voting and other rights of such
Assignors with respect to the Interests.
By signing and delivering this Assignment, Assignors also irrevocably
constitute and appoint Assignee and its designees as the Assignors'
attorneys-in-fact, each with full power of substitution, to the full extent of
the Assignors' rights, with respect to the Interests. All prior powers of
attorney granted by the Assignors with respect to the Interests will, without
further action, be revoked, and no subsequent powers of attorney may be granted
with respect to the Interests (and if granted will not be effective). Pursuant
to this appointment as attorneys-in-fact, Assignee and its designees each will
have the power, among other things: (a) to seek to transfer ownership of such
Interests on the Partnership's books maintained by the transfer agent and to
sign and deliver any accompanying evidences of transfer and authenticity in
connection with that transfer; (b) to become a registered owner of the purchased
Interests; (c) to receive any and all distributions made by the Partnership
after the date hereof and to receive all benefits and otherwise exercise all
right of beneficial ownership of such Interests, except to the extent set forth
in the first paragraph hereof; and (d) to endorse any check payable to or upon
the order of such Assignors representing a distribution to which Assignee is
entitled pursuant to the terms hereof.
Dated: October 4, 2001
ASSIGNORS:
By: /s/ Xxxxx Xxxxx
--------------------------------
Authorized Representative
By: ____________________________
Authorized Representative
ASSIGNEE:
Xxxx Xxxxxxx
Exhibit F-2
EXHIBIT G
PROXY COUPLED WITH AN INTEREST
FOR
SIERRA PACIFIC DEVELOPMENT FUND II LIMITED PARTNERSHIP
The undersigned, a limited partner of Sierra Pacific Development Fund II
Limited Partnership, a ______________ limited partnership (the "Partnership"),
hereby designates Xxxx X. Xxxxxxx as Proxy, with full power of substitution, to
exercise all voting or consent rights with respect to all of the undersigned's
units in the Partnership that are the subject of the Purchase Agreement, as
defined below. Subject to the provisions of this proxy, all prior proxies given
by the Assignors with respect to such interests are hereby revoked without
further action and no subsequent proxies may be given with respect to such
interests (and, if given or signed, will not be deemed effective).
This proxy is coupled with an interest and may only be revoked if Xxxx X.
Xxxxxxx, Xxxxxxx X. Xxxxxx or CGS Real Estate Company, Inc. has materially
breached that certain Purchase and Security Agreement dated October 4, 2001
between Xx. Xxxxxxx and the undersigned as a member of the Xxxxx Group (the
"Purchase Agreement") and has failed to cure such breach within the lesser
period of the number of days between such breach and the next exercise of voting
or consent rights hereunder, or 10 days after written notice thereof. Such
revocation must be made in writing by Xxxxx Xxxxx on behalf of the undersigned
Exhibit G-1
limited partner accompanied by a signed certificate from Xx. Xxxxx that Xx.
Xxxxxxx, Xx. Xxxxxx or CGS Real Estate Company, Inc. has materially breached the
Purchase Agreement and has failed to cure such breach in accordance with this
proxy.
Dated this 4th day of October, 2001.
/s/ Xxxxx Xxxxx
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Limited Partner
Xxxxx Xxxxx
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Print Name
Unit or fractional Unit owned 4,013
G-2
