AGREEMENT OF SALE
by and between
XXXXXX REALTY CORPORATION,
as Seller
and
BEACON PROPERTIES, L.P.,
As Buyer
Re: Centerpointe I and II
Fairfax, Virginia
Table of Contents
Paragraph Caption Page
1. Sale and Purchase 1
2. Purchase Price 2
3. Closing 2
4. Condition of Title 2
5. Possession 4
6. Leases; Agreements 4
7. Closing Apportionments 5
8. Seller's Representations and Warranties 7
9. Buyer's Representations and Warranties 9
10. Conditions to Closing 9
11. Deliveries at Closing 11
12. Default 13
13. Notices 13
14. Fire or Other Casualty 15
15. Assignability 16
16. Inspection Period 17
17. Condemnation 18
18. Brokers 19
19. Condition of Premises 19
20. Survival of Provisions 21
21. ERISA 23
22. Escrow Provisions 23
23. Miscellaneous 24
Exhibits
A Legal Description of Premises
B List of Personal Property
C List of Permitted Title Exceptions
D List of Existing Leases
E List of Existing Agreements
F Form of Assignment and Assumption Agreement
G Form of Centerpointe III Option Agreement
H Form of Tenant Estoppel Certificate
(i)
I-1 Form of Special Warranty Deed
I-2 Form of Xxxx of Sale
J-1 Form of FIRPTA Certification
J-2 Form of Seller's Title Affidavit
K Form of Notice to Tenants
L List of Excluded Personal Property
M Seller's Closing Certificate
N Buyer's Closing Certificate
Schedules
7(a) Copies of Existing Loan Documents
7(C) Tenant Security Deposits
7(g) Leasing Commissions and Tenant Improvement Costs
8(a)(iv) Pending Litigation
(ii)
AGREEMENT OF SALE
THIS AGREEMENT OF SALE (this "Agreement") made this 26 day of March,
1997 by and between XXXXXX REALTY CORPORATION, a Delaware corporation
("Seller") and Beacon Properties, L.P., a Delaware Partnership ("Buyer").
W I T N E S S E T H:
1. Sale and Purchase. Seller agrees to sell and convey to
Buyer, and Buyer agrees to purchase from Seller, upon the terms
and conditions set forth in this Agreement.
(a) Real Property. All that certain lot or piece of ground
situate in Fairfax, Virginia, which is more fully described by metes and
bounds on Exhibit A to this Agreement, together with the two office buildings
and other improvements containing approximately 408,111 square feet situate
thereon (the "Premises"), together with all rights and appurtenances pertaining
to the Premises, including any right, title and interest of Seller in and to
adjacent streets and rights-of-way.
(b) Tangible Personal Property. The fixtures, furnishings,
equipment and other items of personal property owned by Seller and located on
and used in connection with the operation of the Premises which are listed on
Exhibit B to this Agreement (collectively, the "Tangible Personal Property").
(c) Intangible Personal Property. The intangible personal
property listed below:
(i) the interests of Seller in all available
booklets, manuals and promotional and advertising materials concerning the
Property and located at the Premises or at the offices of Lincoln Property
Company, the manager of the Premises ("Manager");
(ii) Seller's interest in the name "Centerpointe,"
subject nevertheless to the right of Centerpointe III Limited Partnership ("CP
III"), its successors and assigns, to utilize such name;
(iii) the interest of Seller in all existing surveys,
blueprints, drawings, plans and specifications (including, without limitation,
structural HVAC, mechanical and plumbing plans and specifications) and other
similar documentation for or with respect to the Premises or any part thereof
(all to the extent assignable or transferable), to the extent in the possession
of Seller or Manager;
(iv) all warranties and guaranties issued in
connection with the Property (all to the extent assignable or transferable); and
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(v) the interests of Seller in all consents,
authorizations, variances or waivers, licenses, permits and approvals from any
governmental or quasi-governmental agency, department, board, commission, bureau
or other instrumentality (all to the extent assignable or transferable) with
respect to the Premises;
(all of the foregoing, collectively, the "Intangible Personal
Property).
(d) Personal Property. The Tangible Personal Property and the
Intangible Personal Property are sometimes collectively referred to in this
Agreement as the "Personal Property."
2. Purchase Price. The purchase price to be paid by Buyer
to Seller for the Premises and the Personal Property is the sum
of Fifty-Five Million Dollars ($55,000,000) (the "Purchase
Price"). The Purchase Price shall be paid as follows:
(a) Deposit. The sum of One Million Dollars ($1,000,000) (the
"Deposit") by the delivery of funds to Commonwealth Land Title Insurance Company
(the "Escrowee"). The Deposit shall be held by Escrowee in accordance with the
provisions of Paragraph 22 of this Agreement.
(b) Loan Assumption. At Buyers's option, Thirty Million
Dollars ($30,000,000) shall be paid at Closing by Buyer's assumption of and
agreement to pay the loan (the "Existing Loan") evidenced by that certain
promissory note (the "Existing Note") dated February 12, 1996 from Seller, as
maker, to the Connecticut General Life Insurance Company, as payee ("Lender") in
the stated principal amount of $30,000,000 and secured by, among other
instruments, that certain Deed of Trust, Security Agreement and Assignment of
Rents and Leases dated February 12, 1996 encumbering the Premises between Seller
and Lender and recorded in the Office of the Clerk of the Circuit Court of
Fairfax County, Virginia in Deed Book 9627 Page 54 (the "Existing Deed of
Trust").
(c) Closing Payment. The balance of the Purchase Price shall
be paid to Seller at Closing by wire transfer of immediate United States federal
funds to Seller's account at a bank designated by Seller.
3. Closing. Closing shall commence at 10:00 a.m. on April
24, 1997 (the "Closing Date") at the offices of Wolf, Block,
Xxxxxx and Xxxxx-Xxxxx, Twelfth Floor Packard Building, 00xx xxx
Xxxxxxxx Xxxxxxx, Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000.
4. Condition of Title.
(a) (i) Title to Premises. Fee simple title to the
Premises shall be conveyed by Seller to Buyer at the completion
of Closing by a deed (the "Deed") containing Seller's special
warranty in substantially the form of Exhibit I-1 to this
Agreement, excluding from such warranty the Permitted Exceptions
(as defined below). Title to the Personal Property
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shall be conveyed by Seller to Buyer at the completion of Closing by a xxxx of
sale ("Xxxx of Sale") in substantially the form of Exhibit I-2 to this
Agreement. Title to the Premises shall be such as will be insured as good and
marketable by Escrowee pursuant to the standard stipulations and conditions of
the most current form of ALTA Policy of Owner's Title Insurance then in use in
the State in which the Premises is located, free and clear of all liens and
encumbrances except for the Permitted Exceptions. Buyer will pay the premium for
the owner's policy and the cost of any endorsements to such policy. The term
"Permitted Exceptions" shall mean the Existing Leases (as defined below), the
additional title exceptions set forth on Exhibit C to this Agreement and any
title exceptions defined as such under clause (ii) below. Title to the Personal
Property shall also be subject to the Permitted Exceptions.
(ii) Title Defects. Not later than the expiration of
the Inspection Period (as defined in Paragraph 16(a)), Buyer shall deliver to
Seller a current title commitment for the Premises issued by Escrowee, together
with a written notice ("Title Notice") specifying any alleged defects in or
objections to the title to the Premises which do not constitute Permitted
Exceptions. Buyer shall be deemed to have waived its right to object to any
encumbrance or other title objection existing at the Closing Date unless Buyer
shall have timely given to Seller the Title Notice which specifies Buyer's
objection, unless such encumbrance or other title objection was not a matter of
record on the effective date of such title commitment. Upon Buyer's failure to
timely object, such encumbrance or other title objection shall be deemed a
Permitted Exception. Seller shall have no obligation to cure any alleged defect
or objection raised in the Title Notice. If Buyer delivers a Title Notice,
Seller shall have five (5) days after receipt of the Title Notice in which to
notify Buyer in writing as to which of the alleged defects or objections raised
in the Title Notice Seller will undertake to cure and which Seller declines to
cure. If Seller fails to timely give such responsive notice to Buyer, Seller
will be deemed to have declined to cure any alleged defect or objection raised
in the Title Notice. In any event, Seller agrees to cure (i) any liens and
encumbrances securing the payment of money which were voluntarily created by
Seller and which are identified in Buyer's Title Notice or which arise after the
date of Buyer's title commitment and (ii) any mechanic's liens. If Seller does
not commit to undertake to cure any alleged title defect raised in Buyer's Title
Notice by April 7, 1997, Buyer shall have the right, exercisable by notice to
Seller given on or before April 11, 1997, to terminate this Agreement. If Buyer
so terminates this Agreement, Escrowee is authorized and directed to return the
Deposit to Buyer, and upon the return of the Deposit to Buyer, neither party
shall have any further rights or obligations under this Agreement (except for
the indemnity and confidentiality
obligations of Buyer to Seller set forth in Paragraph 16(a) and 16(f) of this
Agreement which shall survive the termination of this Agreement). If Buyer does
not so terminate this Agreement, those matters which Buyer objected to in the
Title Notice and which Seller declined to cure shall be deemed Permitted
Exceptions. If Seller fails to cure by Closing any alleged title defect or title
objection which Seller notifies Buyer Seller will undertake to cure, Buyer shall
have the rights set forth in Paragraph 4(b).
(b) Failure of Title. If on the Closing Date title to the
Premises is not insurable as set forth in Paragraph 4(a) above, Buyer may elect,
as its sole right and remedy, either (i) to take such title to the Premises as
Seller can convey without abatement of the
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Purchase Price except for liens and encumbrances of an ascertainable amount
which Seller has agreed to cure pursuant to Paragraph 4(a)(ii) or (ii) to
terminate this Agreement by written notice to Seller and Escrowee and be paid
the Deposit. Notwithstanding the foregoing provisions, Buyer agrees to accept
title to the Premises and Personal Property subject to judgments against Seller
if buyer's title insurer insures Buyer against loss by reason of such judgments.
If Buyer so terminates this Agreement, Escrowee is authorized and directed to
return the Deposit to Buyer, and upon the return of the Deposit to Buyer,
neither party shall have any further rights or obligations under this Agreement
(except for the indemnity and confidentiality obligations of Buyer to Seller set
forth in Paragraph 16(a) and 16(f) of this Agreement which shall survive the
termination of this Agreement).
5. Possession. Possession of the Premises and the Personal
Property is to be given by Seller to Buyer at the completion of
Closing by delivery of the Deed and the Xxxx of Sale and by
assignment of the Existing Leases.
6. Leases; Agreements.
(a) Existing Leases. If Seller intends, prior to Closing, to
enter into new leases for portions of the Premises or to enter amendments of
Existing Leases, Seller shall first submit to Buyer for Buyer's approval a term
sheet (the "Leasing Term Sheet") identifying the tenant or proposed tenant and
setting forth the material economic terms of such transaction. If Buyer does not
disapprove such proposed lease transaction by written notice to Seller given
within five (5) business days after Buyer's receipt of the Leasing Term Sheet,
Buyer shall be deemed to have approved the proposed lease transaction which is
the subject of such Leasing Term Sheet. Buyer acknowledges that it has approved
the pending lease transactions described on Schedule 7(g) to this Agreement.
Notwithstanding the foregoing, Seller shall not be required to obtain Buyer's
consent to such amendments as Seller may be required to enter under the terms of
an Existing Lease or which Seller may enter to confirm matters for which a
tenant under an Existing Lease exercises an option (for example, an amendment to
confirm the terms pursuant to which a tenant may lease expansion space following
the exercise by such tenant of an expansion option). Seller shall promptly
notify Buyer of any such amendments. Seller shall not enter any new lease or
amend any Existing Lease, except as provided in this Paragraph. All existing
leases listed on Exhibit D to this Agreement, together with lease amendments and
new leases entered in accordance with this Paragraph, are collectively called
the "Existing Leases." Without limiting the effect of any other condition to
Closing contained in this Agreement, the termination of any of the Existing
Leases prior to Closing by reason of the expiration of its term or by reason of
the tenant's default or exercise of a termination right shall not excuse Buyer
from its obligation to complete Closing and to pay the Purchase Price. At
Closing, Buyer shall receive a credit on account of the Purchase Price equal to
the amount of any lease termination or similar payment made by any tenant to
Seller between the date of this Agreement and Closing.
(b) Existing Agreements. Seller shall also assign to Buyer at
the completion of Closing, to the extent assignable, Seller's interests under
the existing agreements listed on Exhibit E to this Agreement (collectively, the
"Existing Agreements"). Seller shall,
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prior to Closing, have the right to enter into new service agreements, provided
any such agreement shall be terminable without penalty on not more than thirty
(30) days' notice. Seller shall promptly provide Buyer with a copy of any new
service agreement. All such new service agreements shall also constitute
Existing Agreements. The termination of any of the Existing Agreements prior to
Closing by reason of the expiration of its term or by reason of a default
thereunder shall not excuse Buyer from its obligation to complete Closing and to
pay the full Purchase Price. Seller shall cause its existing management
agreement with Manager to be terminated as of Closing.
(c) Assignment and Assumption. At Closing, Seller and Buyer
shall execute and acknowledge an assignment and assumption agreement (the
"Assignment and Assumption Agreement") in the form of Exhibit F to this
Agreement pertaining to the Existing Leases and the Existing Agreements.
7. Closing; Apportionments.
(a) Items to be Apportioned. Personal property taxes, real
estate taxes and annual municipal or special district assessments (on the basis
of the actual fiscal years for which such taxes are assessed), sums paid to or
payable by Seller under the Existing Agreements, prepaid fees for licenses and
permits to remain in effect for Buyer's benefit after Closing, rent, parking
fees and other sums paid to Seller under the Existing Leases shall be
apportioned at Closing pro rata between Buyer and Seller on a per diem basis as
of the Closing Date.
(b) Tenant Pass-Throughs. If the apportionment of any
"escalation" payments relating to operating expenses, real estate taxes and
assessments or other additional rent payments under any of the Existing Leases
on account of periods prior to Closing and on account of sums which are
attributable to expenses incurred by the lessor for periods of time prior to
Closing, cannot be precisely determined at the time of Closing, Seller and Buyer
shall reasonably estimate the apportionment of such sums, and such estimated
sums shall be apportioned pro-rata between Buyer and Seller on a per diem basis
as of the Closing Date. A post Closing adjustment shall be made, if necessary,
between Buyer and Seller for such apportioned items within thirty (30) days
after such sums can be precisely determined. Seller shall provide Buyer after
Closing a final accounting of all escalatable operating costs for the portion of
1997 falling within the period of Seller's ownership of the Property.
(c) Tenant Security Deposits. At Closing, Seller shall credit
against the Purchase Price the amount of all cash security deposits payable to
tenants then held by or for Seller under the Existing Leases as set forth on
Schedule 7(c), together with an amount equal to interest thereon as may be
required by law or under the terms of an Existing Lease. At Closing, Seller
shall deliver to Buyer a current schedule of tenants and such security
deposits. Seller shall not apply any tenant security deposit on account of a
default by a tenant under its Existing Lease occurring between the date of this
Agreement and Closing.
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(d) Utility Charges. Seller shall use reasonable efforts to
obtain readings of a gas, water and electric meters on the Premises (other than
meters measuring utility consumption whose charges are payable by tenants in
accordance with the Existing Leases) to a date no sooner than two (2) days prior
to the Closing Date. Seller shall pay all utility charges based upon such meter
readings. However, if after reasonable efforts Seller is unable to obtain
readings of any meters prior to Closing, Closing shall be completed without such
readings and upon the obtaining thereof after Closing, Seller shall pay the
charges incurred prior to Closing as determined based upon such readings. Seller
shall not assign to Purchaser any deposits which Seller has with any utility
service or company servicing the Premises.
(e) Unpaid Real Estate Taxes. If, on the Closing Date, bills
for real estate taxes imposed upon the Premises for any part of the tax fiscal
years in which Closing occurs have been issued but shall not have been paid,
such taxes shall be paid at the time of Closing.
(f) Arrearages.
(i) Rent Arrearages. At or before Closing, Seller shall
identify those tenants in arrears in the payment of rent or any other amount due
Seller, and the amount thereof. Any payments received by Buyer after the Closing
Date from a tenant so identified under any of the Existing Leases on account of
rentals or other sums which are applicable to periods prior to Closing, shall be
apportioned by Buyer upon receipt and the portion thereof attributable to
periods prior to Closing shall immediately be paid by Buyer to Seller; provided
all payments by such tenants after Closing will be deemed as being applicable,
first, as against current rental due, then, as against such arrearages which
existed as of Closing. Seller shall be deemed to have retained all claims
existing against tenants for arrearages under any of the Existing Leases as of
Closing.
(ii) Contract Arrearages. Any payments received by Buyer
after the Closing Date under any of the Existing Agreements on account of
payments which are applicable to periods prior to Closing shall be apportioned
by Buyer upon receipt and the portion thereof attributable to periods prior to
Closing shall immediately be paid by Buyer to Seller.
(iii) Accounting. Until the earlier to occur of (A) such
time as Seller shall have received in full all sums which are potentially
payable to it on account of any of the Existing Leases or the Existing
Agreements as provided in subparagraphs (i) and (ii) above or (B) twelve (12)
months after Closing, Buyer shall provide to Seller after Closing a monthly
statement of rent received by Buyer under any of the Existing Leases or other
sums received by Buyer under any of the Existing Agreements for those tenants
and vendors pursuant to which Seller might be entitled to payments as provided
in said subparagraphs.
(g) Leasing Commissions: Tenant Improvements. At Closing,
Seller will either deliver to Buyer evidence of payment or provide a credit
against the Purchase Price for those unpaid leasing commissions and tenant
improvement allowance amounts shown on
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Schedule 7(g) to this Agreement as being payable by Seller. Buyer shall assume
the obligations of Seller to pay any leasing commission and perform any tenant
improvement work for which Buyer receives a credit on account of the Purchase
Price under this Paragraph 7(g). At Closing buyer shall reimburse Seller for all
leasing commissions and tenant costs actually paid or payable by Seller (i) for
lease transactions entered after the date of this Agreement in accordance with
Paragraph 6(a) of this Agreement, (ii) for lease transactions shown on Schedule
7(g) to this Agreement as being payable by Buyer and (iii) as a result of the
renewal or expansion of Existing Leases which occur between March 4, 1997 and
the Closing Date which are effectuated pursuant to existing renewal or expansion
options under Existing Leases. Seller shall provide Buyer with invoices and
evidence of Seller's payment of such costs for which Buyer is to reimburse
Seller. Buyer shall timely pay after the Closing Date all leasing commissions
and tenant costs which become due and payable after the Closing Date. Tenant
costs include tenant improvement costs and if the lease so provides moving
costs, design costs and incurred by the tenant, lease buyout costs and tenant
inducement costs.
(h) Interest to Lender. Interest under the Note which is
secured by the Existing Deed of Trust is payable monthly in arrears. Therefore,
the interest portion of the monthly payment to be made to the holder of the
Existing Note on the Closing Date, if Closing occurs on the day such payment is
due and payable, or to be made on the next payment date if Closing does not
occur on a date on which any payment is due and payable, shall be apportioned on
a per diem basis for the monthly period preceding such payment, and Buyer shall
be given a credit at Closing on account of the Purchase Price for the portion of
such interest payment attributable to the period occurring prior to closing.
(i) Escrows. At Closing, Seller shall assign to Buyer all sums
(if any) then held in escrow by the holder of the Existing Deed of Trust on
account of real estate taxes and insurance premiums, if any, and Buyer shall pay
to Seller at Closing a sum equal to such escrowed funds assigned to Buyer.
(j) Fees to Lender. Buyer will also pay the $150,000
assumption fee, if imposed by Lender, in connection with Buyer's assumption of
the Existing Loan. If Buyer does not assume the Existing Loan and the Existing
Loan is paid off at Closing, Buyer will also pay the prepayment fee or premium
payable under the Existing Note.
(k) Transfer Tax. Buyer shall pay the state and county realty
transfer taxes imposed in connection with the Deed or transactions contemplated
by this Agreement. Seller shall pay the grantor's tax imposed in connection with
the Deed or transactions contemplated by this Agreement.
8. Seller's Representations and Warranties.
(a) Seller represents and warrants to Buyer as follows:
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(i) Organization. Seller is a corporation, duly organized and
validly existing under the laws of the State of Delaware and has all requisite
corporate power and authority to carry on its business as now conducted.
(ii) Authorization. Seller has all requisite corporate power
and authority to enter into and perform this Agreement, and Seller has duly
authorized the execution and performance of this Agreement. No consent or
approval from any third party is required in order to enable Seller to execute
this Agreement and perform its obligations hereunder.
(iii) No Condemnation. To Seller's knowledge, there are no
existing or pending condemnation proceedings affecting the Premises, nor, to
Seller's actual knowledge, have any such condemnation proceedings been overtly
threatened.
(iv) No Proceedings. Except as set forth on Schedule 8(a)(iv)
to this Agreement, Seller has received no written notice of any pending actions,
suits or proceedings against Seller or the Premises nor, to Seller's knowledge,
is there any action, suit or proceeding against Seller or the Premises
threatened which would prevent consummation by Seller of the sale of the
Premises or materially and adversely affect the performance of any of Seller's
other obligations to be performed under this Agreement. Seller has not received
any written notice from any governmental authority claiming a violation or
alleged violation of any law, rule, ordinance or code with respect to the
Premises which remains uncured.
(v) Existing Leases. The list of Existing Leases attached to
this Agreement as Exhibit D-1 is, to Seller's knowledge, true, correct and
complete in all material respects. To Seller's knowledge, all of the Existing
Leases listed on Exhibit D-1 are, except as otherwise noted thereon, in full
force and effect and Seller has received no notice of default from any of the
tenants thereunder which remains uncured. To Seller's knowledge, except as
otherwise noted on Exhibit D-1, none of the tenants is in default under its
Existing Lease (except for rental obligations for the current month) in any
material respect. Except as set forth on Exhibit D-1, Seller has received no
prepayments of rent under any Existing Lease. Exhibit D-1 contains a schedule of
deposits made by tenants as security for such tenants' obligations under their
Existing Leases presently on deposit with Seller for the account of tenants.
Except as set forth on Exhibit D-1 or Schedule 7(g), (A) Seller has paid in full
all concessions, relocation payments and tenant allowances and has completed all
tenant improvement obligations under the Existing Leases and (B) all leasing
commissions and fees due with respect to the current demised premises and
current unexpired term of each Existing Lease have been paid in full. The copies
of the Existing Leases previously delivered by Seller to Buyer are true and
complete copies of such Existing Leases and the same have not been further
amended, modified or supplemented.
(vi) Existing Agreements. Exhibit E is a true, correct and
complete list of all Existing Agreements to which Seller is a party or by which
Seller is bound for the provision of services to or management of the Premises.
To Seller's knowledge, all of the Existing Agreements are in full force and
effect and free from material default. The copies of
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the Existing Agreements previously delivered by Seller to Buyer are true,
correct and complete copies of such Existing Agreements and the same have not
been further amended, modified or supplemented.
(vii) Existing Loan. Attached as Schedule 7(a) to this
Agreement are true and correct copies of the Existing Note, Existing Deed of
Trust, the Assignment of Rents and Leases from Buyer in favor of Lender,
Borrower's Certificate, the Environmental Indemnification Agreement between
Seller and Lender, the Tax Deposit Agreement among Seller, Lender and Columbia
National Real Estate Finance, Inc., the Collateral Assignment of Contracts,
Licenses and Permits and UCC Financing Statements. Such documents constitute all
of the material documents executed by Seller at closing on the Existing Loan and
none of such documents has been materially amended. Seller has received no
written notice from Lender asserting any default by Seller under the Existing
Loan.
(b) All references in this Paragraph 8 or elsewhere in this
Agreement to "Seller's knowledge" shall refer solely to the actual knowledge of
Xxxxxxx X. Xxxxxx, Xxxxxxx X. Xxxxx and Xxxxxx Xxxxxxxx after having made
inquiry of Xxxxx Xxxxxxx, Manager's on-site manager for the Premises, and shall
not be construed to refer to the knowledge of any other employee, officer,
director, shareholder or agent (including Manager) of Seller or any affiliate of
Seller, and shall not include inputed or constructive knowledge.
9. Buyer's Representations and Warranties. Buyer hereby
represents and warrants to Seller as follows:
(a) Organization. Buyer is a limited partnership duly
organized and validly existing under the laws of the State of Delaware and has
all requisite partnership power and authority to carry on its business as now
conducted.
(b) Authorization. Buyer has all requisite partnership power
and authority to enter into and perform this Agreement and Buyer has or prior to
the end of the Inspection Period, will have duly authorized the execution and
performance of this Agreement. Buyer has received all approvals (except any
approvals to be obtained during the Inspection Period) necessary to consummate
the transactions described herein.
10. Conditions to Closing.
(a) Buyer shall not be obligated to complete Closing under
this Agreement unless each of the following conditions shall be fulfilled on the
Closing Date.
(i) Title Policy. Escrowee or another title insurance
company authorized to transact business in the State of Virginia reasonably
acceptable to Buyer and Buyer's counsel shall commit in writing to Buyer to
issue an owner's policy of title insurance as described in Paragraph 4(a).
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(ii) Accuracy of Representations. The representations and
warranties made by Seller in this Agreement shall be true and correct as of the
Closing Date in all material respects.
(iii) Seller's Performance. Seller shall have complied
with and performed in all material respects all of its obligations under this
Agreement.
(iv) Tenant Estoppel Certificates. Seller shall have
obtained and delivered to Buyer by Closing Tenant Estoppel Certificates (as
defined below) from American Management Systems, Inc. ("AMS") and from other
tenants occupying not less than seventy-five percent (75%) of the remaining
rentable area of the Premises not occupied by AMS. Seller may satisfy this
condition by executing and delivering to Buyer at Closing Tenant Estoppel
Certificates ("Seller Estoppels") with respect to any one or more Existing
Leases for which no Tenant Estoppel Certificate was obtained; provided, Seller
may not satisfy this condition by delivering a Seller Estoppel for AMS, Fujitsu
or Liberty Mutual. Each Seller Estoppel shall cease to be effective, and
Seller's obligations thereunder will terminate, upon the earlier of receipt from
the applicable tenant of a Tenant Estoppel Certificate consistent with the
requirements of this Paragraph or twelve (12) months after Closing. Seller
agrees to use its reasonable efforts to cause tenants under the Existing Leases
to deliver to Buyer at Closing a written statement ("Tenant Estoppel
Certificate") in substantially the form of the tenant estoppel certificate set
forth on Exhibit H to this Agreement or in the form which any tenant is required
to give under its lease. Buyer agrees not to object to any non-material
qualifications or modifications, including any "knowledge" qualification as to
defaults which a tenant may make to the form of Tenant Estoppel Certificate. If
any tenant has a claim which would entitle it to set-off the amount of the claim
against rent due under such tenant's lease and the amount of such claim is
ascertainable, Seller shall have the right, at its sole option, to give Buyer a
credit against the cash portion of the Purchase Price payable at Closing in the
amount of the claim and, in such event, Buyer shall, subject to the provisions
of this Agreement, complete Closing subject to such claim.
(v) Centerpointe III Option. CP III shall have delivered
to Buyer CP III's executive option agreement in the form of Exhibit G to this
Agreement with respect to certain land located in Fairfax, Virginia and
generally known as Centerpointe III (the "Option Agreement"). Prior to the end
of the Inspection Period, Buyer will deliver to Seller a title commitment for
the real property which is the subject of the Option Agreement. It shall be a
condition of Buyer's obligation to close under this Agreement that, prior to
Closing, Buyer and CP III shall agree upon the content of Exhibit B, List of
Permitted Title Exceptions, to be inserted in such Option Agreement.
(b) Seller shall not be obligated to complete Closing under
this Agreement unless each of the following conditions shall be fulfilled on the
Closing Date:
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(i) Buyer's Performance. Buyer shall have paid
the Purchase Price and shall have complied with and performed in all material
respects all of its other obligations under this Agreement.
(ii) Loan Assumption. If Buyer assumes the
Existing Loan, Lender shall have agreed to release Seller from all liability
under the Existing Loan accruing from and after Closing; provided, that this
condition shall be deemed waived if Buyer elects to purchase the Premises
without assuming the Existing Loan.
(iii) Centerpointe III Option. Buyer and CP III
shall have agreed prior to Closing upon the content of Exhibit B, List of
Permitted Title Exceptions, to be inserted in the Option Agreement.
11. Deliveries at Closing.
(a) Seller's Deliveries. On the Closing Date, Seller
shall deliver to Buyer the following:
(i) Deed. The Deed.
(ii) Xxxx of Sale. The Xxxx of Sale.
(iii) Assignment and Assumption Agreement. The
Assignment and Assumption Agreement.
(iv) Authority Documents. A resolution, to evidence
Seller's authorization of performance of this Agreement and an incumbency
certificate to evidence the capacity of the signatory for Seller.
(v) FIRPTA Certification and Title Affidavit. A
certificate in the form attached to this Agreement as Exhibit J-1 with respect
to compliance with the Foreign Investment in Real Property Tax Act (Internal
Revenue Code Section 1445, as amended, and the regulations issued thereunder)
and an affidavit in the form of Exhibit J-2 in favor of the title insurer who
will insure Buyer's title to the Premises (which affidavit shall in no event
expand Seller's warranty contained in the Deed).
(vi) Keys. All keys, codes and other security devices
for the Property (to the extend in Seller's possession).
(vii) Tenant Notices. Written notice from Seller to
each tenant of the Property under the Existing Leases in substantially the form
of Exhibit K to this Agreement.
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(viii) Books and Records. Copies (to the extent in
Seller's possession) of all books and records for the orderly transition of
operation of the Premises (delivery of same being deemed made by making them
available to buyer at the office of Seller's managing agent).
(ix) Original Documents. The originals (to the extent
in Seller's possession) of all Existing Leases, all Existing Agreements,
warranties, guaranties, permits and approvals, plans and specifications and all
other materials owned by Seller relating to the Intangible Personal Property,
the maintenance and operation of the Property and which are currently in
Seller's possession (delivery of same being deemed made by making them available
to Buyer at the office of Seller's managing agent).
(x) Seller's Closing Certificate. An executive
original of the Seller's Closing Certificate in the form attached as Exhibit M.
(xi) Termination of Management Agreement. Evidence of
the Termination of the existing Management Agreement with Manager with respect
to the Property.
(xii) Closing Statement. An executive original
Closing Statement setting forth the calculation of the Purchase Price and the
prorations provided for hereunder.
(xiii) Transfer Tax Forms. An executed original of
any transfer tax forms required in connection with the Closing.
(xiv) Other Documents. Any other documents which
Seller is obligated to deliver pursuant to this Agreement.
(b) Buyer's Deliveries. On the Closing Date, Buyer
will deliver to Seller the following:
(i) Assignment and Assumption Agreement. The
Assignment and Assumption Agreement.
(ii) Tenant Notices. Written notice from Buyer to
each tenant of the Premises under the Existing Leases in substantially the form
of Exhibit K to this Agreement.
(iii) Authority Documents. A resolution, to evidence
Buyer's authorization of performance of this Agreement, and an incumbency
certificate to evidence the capacity of the signatory for Buyer.
(iv) Purchase Price. That portion of the Purchase
Price payable at Closing.
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(v) Buyer's Closing Certificate. An executed original
of Buyer's Closing Certificate in the form attached as Exhibit N.
(vi) Transfer Tax Forms. An executed original of any
transfer tax forms required in connection with the Closing.
(vii) Other Documents. Any other documents which
Buyer is obligated to deliver pursuant to this Agreement.
12. Default.
(a) Buyer Default. If Buyer defaults under this Agreement at
the Closing Date by failing to complete Closing in accordance with the terms of
this Agreement, then on the Closing Date, Seller shall be entitled, as Seller's
sole and exclusive remedy at law or in equity for such default by Buyer
hereunder, to be paid the Deposit as liquidated damages and not as a penalty.
Seller and Buyer agree that the actual damages to Seller in the event of such
default are impractical to ascertain as of the date of this Agreement and that
the amount of the Deposit is a reasonable estimate thereof. Nothing in this
Paragraph, however, shall limit Seller's rights against Buyer by reason of any
indemnity obligations of Buyer to Seller set forth in this Agreement, all of
which shall survive the termination of this Agreement.
(b) Seller Default. If Seller defaults under this Agreement at
or prior to the Closing Date by failing to complete Closing in accordance with
the terms of this Agreement, then on the earlier of the Closing Date or the date
of Seller's default, Buyer shall be entitled, as Buyer's sole and exclusive
remedy, to institute an action for specific performance of this Agreement.
13. Notices.
(a) All notices given by either party to the other shall be in
writing and shall be sent either (i) by United States Postal Service registered
or certified mail, postage prepaid, return receipt requested, (ii) by nationally
recognized overnight courier service for next business day delivery, addressed
to the other party at the addresses listed below or (iii) via telecopier or
facsimile transmission to the facsimile numbers listed below, provided, however,
that if such communication is given via telecopier or facsimile transmission, an
original counterpart of such communication shall concurrently be sent in the
manner specified in clause (ii) above. Addresses and facsimile numbers of the
parties are as follows:
As to Seller:
c/o GE Investments
0000 Xxxxxx Xxxxxx
P.O. Box 7900
Xxxxxxxx, Xxxxxxxxxxx 00000
13
Attention: Xxxxxxx X. Xxxxx
Fax: (000) 000-0000
With copies at the same time to:
GE Investments
0000 Xxxxxx Xxxxxx
P.O. Box 7900
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx, Esquire
Fax: (000) 000-0000
and
Wolf, Block, Xxxxxx and Xxxxx-Xxxxx
Twelfth Floor Packard Building
00xx xxx Xxxxxxxx Xxxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxx, Esquire
Fax: (000) 000-0000
As to Buyer:
Beacon Properties, L.P.
00 Xxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xx. Xxxx X'Xxxxx
Fax: (000) 000-0000
with a copy at
the same time to:
Beacon Properties Corporation
00 Xxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxx, Esquire, General
Counsel
Fax: (000) 000-0000
and to
Goulston & Storrs
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
14
Attention: Jordan X. Xxxxxxx, Esquire
Fax: (000) 000-0000
As to Escrowee:
Commonwealth Land Title Insurance Company
00 Xxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxxxx Xxxxxxx
Fax: (000) 000-0000
or to such other address as the respective parties may hereafter designate by
notice in writing in the manner specified above. Any notice may be given on
behalf of any party by its counsel.
(b) Notices given in the manner aforesaid shall be deemed
sufficiently served or given for all purposes under this Agreement upon the
earlier of (i) actual receipt or refusal by the addressee or (ii) one day
following the date such notices, demands or requests shall be deposited in any
Post Office, or branch Post Office regularly maintained by the United States
Government or delivered to the overnight courier service.
14. Fire or Other Casualty.
(a) Casualty Insurance. Seller agrees to maintain in effect
until the Closing Date the fire and extended coverage insurance policies now in
effect for the Premises.
(b) Casualty Damage. Subject to subparagraph (c) below, the
obligations of the parties to complete Closing under this Agreement shall in no
way be voided or impaired if the Premises or Personal Property, or any part
thereof, shall be damaged or destroyed by fire or other casualty between the
date of this Agreement and the Closing Date. If any such damage or destruction
occurs after the date of this Agreement: (i) Seller shall provide Buyer with
notice thereof, (ii) the cash proceeds of all fire and extended coverage
insurance policies attributable to the Premises or the Personal Property
received by Seller prior to the Closing Date and not used by Seller for the
repair of the Premises and the Personal Property (and Buyer hereby authorizes
Seller to use the proceeds for such purpose) shall be applied on account of the
cash portion of the Purchase Price payable at Closing, (iii) the cash proceeds
of such insurance proceeds retained by Lender on account of the Existing Loan
shall be applied on account of that portion of the Purchase Price payable by
Buyer's assumption of the Existing Loan or, if buyer does not assume the
Existing Loan, shall be applied on account of the cash portion of the Purchase
Price payable at Closing, (iv) all unpaid claims under such insurance policies
attributable to the Premises and Personal Property shall be assigned by Seller
to Buyer at the Closing and (v) at Closing Seller shall pay to Buyer an amount
equal to Seller's deductible under such insurance policies attributable to the
Premises and Personal Property.
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(c) Right of Termination. Notwithstanding any of the preceding
provisions of the Paragraph 14, if the cost to repair damage caused by fire or
other casualty to the Premises exceeds One Million Dollars ($1,000,000), Buyer
shall have the right to terminate this Agreement by written notice to Seller.
Upon such termination, the Deposit shall be returned by Escrowee to Buyer and
neither party shall have any further rights or obligations under this Agreement
(except for the indemnity and confidentiality obligations of Buyer to Seller set
forth in Paragraph 16(a) and 16(f) of this Agreement which shall survive the
termination of this Agreement). If Buyer desires to terminate this Agreement
pursuant to this subparagraph (c), Buyer, shall give a written notice of
termination to Seller within ten (10) business days after Seller's notice to
Buyer of the occurrence of the casualty. If Seller's notice pursuant to
Paragraph 14(b)(i) is given to Buyer less than ten (10) business days prior to
Closing, at Buyer's option Closing may be postponed to a date not earlier than
ten (10) business days or later than thirty (30) days after Buyer's receipt of
such notice.
15. Assignability.
(a) Limited Assignment. Subject to the limitations set forth
in subparagraph (b) below, this Agreement and all, but not part, of Buyer's
rights under this Agreement may be assigned by Buyer, without the prior written
consent of Seller, to an entity which is qualified to do business in the State
in which the Premises is located and in which Buyer (and/or Beacon Properties
Corporation ("BPC") and/or one or more entitled 100% owned and controlled by
Buyer and/or BPC) owns for its own account not less than one hundred percent
(100%) of the ownership interests therein and maintains control over the
management and affairs of the entity; provided, however, that such assignment
shall not release or relieve Buyer of an from any liability or obligation under
this Agreement, and Buyer shall continue to be primarily liable to Seller under
this Agreement. No such assignment shall be effective, however, unless and until
Buyer shall have furnished to Seller both an executed copy of the assignment
plus a written assumption agreement, in form satisfactory to Seller, by the
assignee to assume, perform and be responsible, jointly and severally with the
Buyer named herein, for the performance of all of the obligations of Buyer under
this Agreement and to pay all additional transfer or documentary taxes imposed
as a result of such assignment, and which contains a representation by the
assignee that all of the representations and warranties made by Buyer in this
Agreement are true and correct with respect to the assignee as of the date of
the assumption agreement. Seller shall have the right to rely in good faith on
the genuineness and validity of the notice from Buyer of an assignment and to
convey the Premises to the assignee without liability to Buyer or any other
person.
(b) Prohibited Assignments. Notwithstanding the foregoing
provisions of subparagraph (a), Buyer shall have no right to assign this
Agreement to any entity owned or controlled by an employee benefit plan if
Seller's sale of the Premises to such entity would, in the judgment of Seller or
Seller's counsel, either create, otherwise cause, or raise a material question
as to whether it would create or otherwise cause, a "prohibited transaction"
under the Employee Retirement Income Security Act of 1974, as amended ("ERISA").
16
(c) Successors and Assigns. Except as provided in subparagraph
(a), Buyer may not assign or suffer an assignment of this Agreement and its
rights under this Agreement. Subject to the foregoing limitations, this
Agreement shall extend to, and shall bind, the respective heirs, executors,
personal representatives, successors and assigns of Seller and Buyer.
16. Inspection Period.
(a) Right to Inspect. Buyer, and Buyer's agents and
representatives, shall have the right, from time to time, through 5:00 p.m.,
Eastern Standard Time on April 3, 1997 ("Inspection Period"), during normal
business hours, to enter upon the Premises for the purpose of inspection of the
physical condition of the Premises (including a Phase I environmental assessment
report, soils report, structural engineering report), evaluation of title,
survey of the Premises, testing of machinery and equipment, evaluation of plans
and specifications and generally for the reasonable ascertainment of the
physical condition of the Premises; provided, however, that Buyer shall (i) give
Seller at least one (1) business day prior notice of the time and place of such
entry and permit a representative of Seller to accompany Buyer; (ii) restore any
damage to the Premises or any adjacent property caused by such actions; (iii)
indemnify, defend and save Seller and, as the case may be, its partners,
trustees, shareholders, directors, officers, employees and agents (each, an
"Indemnified Party") harmless of and from any and all claims, costs and
liabilities actually incurred by any Indemnified Party such entry and such
activities; (iv) not enter into any tenant's leased premises or communicate with
any tenant without Seller's prior consent, which consent will not be
unreasonably withheld, and in all such events Seller shall be afforded the
opportunity to accompany Buyer's representatives when exercising any rights
under this cause (iv). All such inspection rights shall be subject to the right
of tenants under the Existing Leases. The costs of all inspections and
examinations so performed shall be borne by Buyer.
(b) No Liens Permitted. Nothing contained in this Agreement
shall be deemed or construed in any way as constituting the consent or request
of Seller, express or implied by inference or otherwise, to any party for the
performance of any labor or the furnishing of any materials to the Premises or
any part thereof, nor as giving Buyer any right, power or authority to contract
for or permit the rendering of any services or the furnishing of any materials
that would give rise to the filing of any liens against the Premises or any part
thereof.
(c) Right of Termination. Buyer shall have the right to
terminate this Agreement by giving Seller written notice ("Termination Notice")
on or prior to the end of the Inspection Period, which right shall be
exercisable by Buyer in its sole discretion. Without limiting the foregoing,
Buyer may terminate this Agreement pursuant to this Paragraph 16(c) if Buyer has
not received all necessary internal board approvals Buyer may require by the end
of the Inspection Period. Upon giving the Termination Notice, this Agreement
shall immediately terminate (except for the indemnity and confidentiality
obligations of Buyer to Seller under Paragraph 16(a) and 16(f) of this Agreement
which shall survive termination of this Agreement) and Escrowee is authorized
and directed to return the Deposit to Buyer. Buyer's failure to
17
deliver the Termination Notice on or before the expiration of the Inspection
Period shall be deemed a waiver of Buyer's right to terminate this Agreement
under this Paragraph.
(d) Deliveries. Seller has furnished or made available to
Buyer, and Buyer acknowledges receipt or the availability of, the following:
(i) Copies of plans and specifications for the
Premises, to the extent currently in Seller's possession.
(ii) The current books and records (excluding,
however, internal memoranda, financial projections, appraisals and projected
budgets) customarily prepared by or at Seller's request with respect to the
Premises, including, without limitation, to the extent so prepared, all ledgers,
records of income, expense, capital expenditures, utility bills and the most
recent property tax xxxx.
(iii) Copies of all service and maintenance contracts
currently in force with respect to the Premises.
(iv) Copies of all Existing Leases and other
occupancy agreements currently in force with respect to the Premises.
(e) NO WARRANTY. NOTWITHSTANDING THE PROVISIONS OF PARAGRAPH
16(d), BUYER ACKNOWLEDGES AND UNDERSTANDS THAT SOME OF THE MATERIALS DELIVERED
BY SELLER HAVE BEEN PREPARED BY PARTIES OTHER THAN SELLER. SELLER MAKES NO
REPRESENTATION OR WARRANTY WHATSOEVER, EXPRESS OR IMPLIED, AS TO THE
COMPLETENESS, CONTENT OR ACCURACY OF THE DELIVERED MATERIALS WHICH WERE NOT
PREPARED BY SELLER.
(f) Buyer shall hold as confidential all information
concerning Seller or the Premises obtained by Buyer in connection with the
transactions contemplated by this Agreement. Buyer shall not, prior to
completion of Closing, release any such information relating to Seller or the
Premises without Seller's prior written consent, except pursuant to court order
or as may otherwise be required by law. Seller hereby consents to Buyer's
disclosure of information relating to Seller or the Premises to Buyer's
prospective mortgage lenders and investors, consultants, officers, directors and
attorneys, and pursuant to Paragraph 23(h).
17. Condemnation.
(a) Immaterial Taking. If any part of the Premises shall be
taken by exercise of the power of eminent domain after the date of this
Agreement, this Agreement shall continue in full force and effect and there
shall be no abatement of the Purchase Price. Seller shall be relieved, however,
of its duty to convey title to the portion so taken, but Seller shall, on the
Closing Date, assign to Buyer all rights and claims to any awards arising
therefrom as well as
18
any money theretofore received by Seller on account thereof net of any expenses
to Seller, including attorneys' fees of collecting the same. Seller shall
promptly furnish Buyer with a copy of the declaration of taking promptly after
Seller's receipt thereof.
(b) Material Taking. If any such taking of a portion of the
Premises materially interferes with the use of the Premises for the purposes for
which it is currently used, either Seller or Buyer may terminate this Agreement
by written notice to the other party. Upon such termination, the Deposit shall
be returned by Escrowee to Buyer and neither party shall have any further rights
or obligations hereunder (except for the indemnity and confidentiality
obligations of Buyer to Seller set forth in Paragraph 16(a) and 16(f) of this
Agreement which will survive termination of this Agreement).
18. Brokers. Each party represents and warrants to the other that it
has dealt with no broker or other intermediary in connection with this
transaction or the Premises other than Xxxxxxx & Wakefield (the "Disclosed
Broker"), whose fees shall be payable by Seller pursuant to a separate agreement
between Seller and Disclosed Broker, and Buyer shall have no liability or
obligation in connection therewith. Each party shall indemnify, defend and save
harmless the other of and from any claim for commission or compensation by any
other broker or other intermediary claiming through the indemnifying party. The
provisions of this Paragraph shall survive Closing.
19. CONDITION OF PREMISES.
(A) ENTIRE AGREEMENT. THE ENTIRE AGREEMENT BETWEEN SELLER AND
BUYER WITH RESPECT TO THE PREMISES AND THE PERSONAL PROPERTY AND THE SALE
THEREOF IS EXPRESSLY SET FORTH IN THIS AGREEMENT. THE PARTIES ARE NOT BOUND BY
ANY AGREEMENTS, UNDERSTANDINGS, PROVISIONS, CONDITIONS, REPRESENTATIONS OR
WARRANTIES (WHETHER WRITTEN OR ORAL AND WHETHER MADE BY SELLER OR ANY AGENT,
EMPLOYEE OR PRINCIPAL OF SELLER OR ANY OTHER PARTY) OTHER THAN AS ARE EXPRESSLY
SET FORTH IN THIS AGREEMENT. WITHOUT IN ANY MANNER LIMITING THE GENERALITY OF
THE FOREGOING, BUYER ACKNOWLEDGES THAT IT AND ITS REPRESENTATIVES HAVE FULLY
INSPECTED THE PREMISES, THE PERSONAL PROPERTY, THE EXISTING LEASES AND EXISTING
AGREEMENTS, OR WILL BE PROVIDED WITH AN ADEQUATE OPPORTUNITY TO DO SO, ARE OR
WILL BE FULLY FAMILIAR WITH THE FINANCIAL AND PHYSICAL (INCLUDING WITHOUT
LIMITATION, ENVIRONMENTAL) CONDITION THEREOF, AND THAT THE PREMISES, THE
PERSONAL PROPERTY, THE EXISTING LEASES AND EXISTING AGREEMENTS HAVE BEEN
PURCHASED BY BUYER IN AN "AS IS" AND "WHERE IS" CONDITION AND WITH ALL EXISTING
DEFECTS AS A RESULT OF SUCH INSPECTIONS AND INVESTIGATIONS AND NOT IN RELIANCE
ON ANY AGREEMENT, UNDERSTANDING, CONDITION, WARRANTY (INCLUDING, WITHOUT
LIMITATION, WARRANTIES OF HABITABILITY, MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE) OR REPRESENTATION MADE BY SELLER OR ANY
19
AGENT, EMPLOYEE OR PRINCIPAL OF SELLER OR ANY OTHER PARTY AS TO THE FINANCIAL OR
PHYSICAL (INCLUDING, WITHOUT LIMITATION, ENVIRONMENTAL) CONDITION OF THE
PREMISES OR THE PERSONAL PROPERTY OR THE AREAS SURROUNDING THE PREMISES, AS TO
ANY MATTER, INCLUDING WITHOUT LIMITATION AS TO ANY PERMITTED USE THEREOF, THE
ZONING CLASSIFICATION THEREOF OR COMPLIANCE THEREOF WITH FEDERAL, STATE OR LOCAL
LAWS, AS TO INCOME OR EXPENSES IN CONNECTION THEREWITH, OR AS TO ANY OTHER
MATTER IN CONNECTION THEREWITH, EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT
OR IN ANY INSTRUMENT TO BE DELIVERED TO BUYER BY SELLER AT CLOSING. BUYER
ACKNOWLEDGES THAT NEITHER SELLER, NOR ANY AGENT OR EMPLOYEE OF SELLER NOR ANY
OTHER PARTY ACTING ON BEHALF OF SELLER HAS MADE OR SHALL BE DEEMED TO HAVE MADE
ANY SUCH AGREEMENT, CONDITION, REPRESENTATION OR WARRANTY EITHER EXPRESSED OR
IMPLIED, OTHER THAN AS ARE EXPRESSLY SET FORTH IN THIS AGREEMENT OR IN ANY
INSTRUMENT TO BE DELIVERED TO BUYER BY SELLER AT CLOSING. THIS PARAGRAPH SHALL
SURVIVE CLOSING.
(b) CHANGE OF CONDITIONS. BUYER SHALL ACCEPT THE PREMISES AND
THE PERSONAL PROPERTY AT THE TIME OF CLOSING IN THE SAME CONDITION AS THE SAME
ARE AS OF THE END OF THE INSPECTION PERIOD, AS SUCH CONDITION SHALL HAVE CHANGED
BY REASON OF WEAR AND TEAR AND DAMAGE BY FIRE OR OTHER CASUALTY, SUBJECT
NEVERTHELESS TO THE PROVISIONS OF PARAGRAPHS 14 AND 17. WITHOUT LIMITING THE
GENERALITY OF THE FOREGOING, EXCEPT AS PROVIDED IN PARAGRAPHS 14 AND 17, BUYER
SPECIFICALLY ACKNOWLEDGES THAT THE FACT THAT ANY PORTION OF THE PREMISES OR THE
PERSONAL PROPERTY OR ANY EQUIPMENT OR MACHINERY THEREIN OR ANY PART THEREOF MAY
NOT BE IN WORKING ORDER OR CONDITION AT THE CLOSING DATE BY REASON OF WEAR AND
TEAR OR DAMAGE BY FIRE OR OTHER CASUALTY, OR BY REASON OF ITS PRESENT CONDITION,
SHALL NOT RELIEVE BUYER OF ITS OBLIGATION TO COMPLETE CLOSING UNDER THIS
AGREEMENT, EXCEPT AS PROVIDED IN SUBPARAGRAPH (c) BELOW, SELLER HAS NO
OBLIGATION TO MAKE ANY REPAIRS OR REPLACEMENTS TO THE PREMISES.
(c) Seller Repairs. Between the date of the execution of this
Agreement and the Closing Date, Seller shall perform such repairs to the
Premises and the Personal Property as Seller has customarily previously
performed to maintain them in the same condition as they are as of the end of
the Inspection Period, as said condition shall be changed by wear and tear and
damage by fire or other casualty.
(d) RELEASE. WITHOUT LIMITING THE PROVISION OF SUBPARAGRAPH
(a) ABOVE AND NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS
AGREEMENT, BUYER HEREBY RELEASES SELLER AND (AS THE CASE MAY BE) SELLER'S
OFFICERS, DIRECTORS, SHAREHOLDERS,
20
TRUSTEES, PARTNERS, EMPLOYEES, MANAGERS AND AGENTS FROM ANY AND ALL CLAIMS,
DEMANDS, CAUSES OF ACTIONS, LOSSES, DAMAGES, LIABILITIES, COSTS AND EXPENSES
(INCLUDING ATTORNEYS' FEES WHETHER THE SUIT IS INSTITUTED OR NOT) WHETHER KNOWN
OR UNKNOWN, LIQUIDATED OR CONTINGENT (HEREINAFTER COLLECTIVELY CALLED THE
"CLAIMS") ARISING FROM OR RELATING TO (i) ANY DEFECTS, ERRORS OR OMISSIONS IN
THE DESIGN OR CONSTRUCTION OF THE PREMISES AND PERSONAL PROPERTY WHETHER THE
SAME ARE THE RESULT OF NEGLIGENCE OR OTHERWISE, OR (ii) ANY OTHER CONDITIONS,
INCLUDING ENVIRONMENTAL AND OTHER PHYSICAL CONDITIONS, AFFECTING THE PREMISES OR
PERSONAL PROPERTY WHETHER THE SAME ARE A RESULT OF NEGLIGENCE OR OTHERWISE. THE
RELEASE SET FORTH IN THIS SECTION SPECIFICALLY INCLUDES, WITHOUT LIMITATION, ANY
CLAIMS (INCLUDING INDEMNITY AND CONTRIBUTION CLAIMS) ARISING UNDER ANY
ENVIRONMENTAL LAWS OF THE UNITED STATES, THE STATE IN WHICH THE PREMISES IS
LOCATED OR ANY POLITICAL SUBDIVISION THEREOF OR UNDER THE AMERICANS WITH
DISABILITIES ACT OF 1990, AS ANY OF THOSE LAWS MAY BE AMENDED FROM TIME TO TIME
AND ANY REGULATIONS, ORDERS, RULES OF PROCEDURES OR GUIDELINES PROMULGATED IN
CONNECTION WITH SUCH LAWS, REGARDLESS OF WHETHER THEY ARE IN EXISTENCE ON THE
DATE OF THIS AGREEMENT.
(e) NOTHING IN SUBPARAGRAPH 19(d) SHALL CONSTITUTE A RELEASE
OF SELLER FOR ANY CLAIM MADE BY A THIRD PARTY AGAINST BUYER ASSERTING INJURY OR
DAMAGE TO SUCH THIRD PARTY ARISING DURING SELLER'S OWNERSHIP OF THE PREMISES,
PROVIDED (i) BUYER DELIVERS WRITTEN NOTICE TO SELLER OF THE THIRD PARTY CLAIM
WITHIN THIRTY (30) DAYS AFTER BUYER'S RECEIPT OF THE THIRD PARTY CLAIM, (ii)
SELLER SHALL BE PERMITTED TO INTERVENE IN DEFENDING THE THIRD PARTY CLAIM AND
(iii) BUYER DOES NOT SETTLE THE THIRD PARTY CLAIM WITHOUT THE WRITTEN CONSENT OF
SELLER. A THIRD PARTY DOES NOT INCLUDE ANY DIRECT OR INDIRECT PRINCIPAL OR
AFFILIATE OF BUYER. NOTWITHSTANDING ANYTHING CONTAINED IN THIS PARAGRAPH, BUYER
AGREES THAT SELLER SHALL HAVE NO LIABILITY TO BUYER UNDER THIS PARAGRAPH
(WHETHER BY REIMBURSEMENT OR CONTRIBUTION UNDER ENVIRONMENTAL LAWS OR OTHERWISE)
FOR THE COST OF ANY CLEANUP, REMEDIATION OR REMOVAL OF HAZARDOUS SUBSTANCES, FOR
THE COST OF ANY REPAIRS OR REPLACEMENTS TO THE PREMISES, OR FOR ANY OTHER COSTS
OF REMEDIATING THE CONDITION GIVING RISE TO THE THIRD PARTY CLAIM (TOGETHER,
"REMEDIATION COSTS") OR FOR BUYER'S LEGAL FEES AND COURT COSTS IN DEFENDING A
THIRD PARTY CLAIM. BUYER SHALL PAY ALL REMEDIATION COSTS AND BUYER'S LEGAL FEES
AND COURT COSTS. SELLER SHALL PAY ITS LEGAL FEES AND COURT COSTS.
(f) Seller Reports. Buyer acknowledges that Seller makes no
warranties or representations regarding the adequacy, accuracy or completeness
of Seller's
21
environmental reports (collectively the "Reports") or other documents relating
to the Reports, and Buyer shall have no claim against Seller based upon the
"Reports or such other documents relating to the Reports. Buyer further
acknowledges that Buyer has had full opportunity to perform such environmental,
engineering, legal and financial investigations and evaluations of the Premises
as Buyer deems appropriate prior to entering into this Agreement or shall have
such opportunity during the Inspection Period, and Buyer has obtained or shall
obtain its own environmental, engineering, legal and financial assessments of
the Premises.
(g) Effect of Disclaimers. Buyer acknowledges and agrees that
the Purchase Price has been negotiated to take into account that the Premises
and Personal Property are being sold subject to the provisions of this Paragraph
19 and that Seller would have charged a higher purchase price if the provisions
in this Paragraph 19 were not agreed upon by Buyer.
20. Survival of Provisions.
(a) Notwithstanding any provision to the contrary set forth in
this Agreement, the agreements and obligations of Buyer under Paragraph 7,
16(a), 16(e), 16(f), 18, and 19, and 23(h) shall survive Closing, and the
warranties and representations of Buyer set forth in Paragraph 9 shall survive
Closing under this Agreement for a period of twelve (12) months.
(b) (i) Notwithstanding any provision to the contrary set
forth in this Agreement, the agreements and obligations of Seller under
Paragraph 7, 18 and 23(h) shall survive Closing, and the warranties and
representations of Seller set forth in Paragraph 8(a) (the "Surviving
Warranties") shall survive Closing under this Agreement for a period of twelve
(12) months, as the same may be extended pursuant to Paragraph 20(b)(iii).
Notwithstanding the foregoing, the representations and warranties of Seller
contained in Paragraph 8(a)(v) with respect to any Existing Lease shall not
survive the delivery to Buyer of a Tenant Estoppel Certificate confirming
matters represented and warranted by Seller with respect to such Existing Lease.
For example, if Buyer receives a Tenant Estoppel Certificate from a tenant and
such certificate confirms some but not all of Seller's representations and
warranties with respect to such Existing Lease contained in Paragraph 8(a)(v),
the representations and warranties of Seller with respect to the matters so
confirmed shall not survive Closing and the representations and warranties of
Seller with respect to the matters not so confirmed shall survive Closing as
provided herein.
(ii) If Buyer determines that any of the Surviving
Warranties are breached prior to the Closing Date, Buyer's sole right and remedy
shall be to terminate this Agreement by giving to Seller written notice of such
termination on or prior to the Closing Date. If Buyer fails to timely give such
written termination notice to Seller, Buyer shall be deemed to have waived any
right or remedy (including, without limitation, any right under this Agreement
to terminate this Agreement) against Seller by reason of the breach of such
warranty. If Buyer terminates this Agreement pursuant to this Paragraph, Buyer
shall be entitled to the return of the Deposit, and upon the return of the
Deposit to Buyer, neither Buyer nor Seller shall have any
22
further rights nor obligations under this Agreement (except for the indemnity
and confidentiality obligations of Buyer to Seller set forth in Paragraph 16(a)
and 16(f) of this Agreement).
(iii) Seller shall have no liability to Buyer by reason of
a breach or default of any of the Surviving Warranties unless Buyer shall have
given to Seller written notice ("Warranty Notice") of such breach or default
within twelve (12) months of the Closing Date, and shall have given to Seller an
opportunity to cure any such breach or default within a reasonable period of
time after Buyer's learning of such breach of warranty. In no event shall
Seller's liability to Buyer by reason of a breach or default of any or all of
the Surviving Warranties exceed $2,000,000, and Seller shall have no liability
to Buyer for breach of the Surviving Warranties except to the extent of the loss
incurred by Buyer as a result thereof exceeds $50,000. Any litigation to enforce
any Surviving Warranty must be commenced within three (3) months from the date
of the Warranty Notice, and if not commenced within such time period, Buyer
shall be deemed to have waived its claims for such breach or default.
21. ERISA. Seller and Buyer hereby agree that, if the transactions
contemplated by this Agreement are non-exempt prohibited transactions under
Section 406 of ERISA, Seller shall not be obligated to sell the Premises to
Buyer and Buyer shall not be obligated to purchase the Premises from Seller.
22. Escrow Provisions.
(a) Investment of Deposit. Escrowee shall invest the Deposit
in such accounts, commercial paper, U.S. government securities, repurchase
agreements or other instruments as Purchaser shall from time-to-time direct and
Seller may approve. Escrowee shall promptly advise Seller and Buyer of the
investment of the Deposit. All interest earned on the Deposit shall be added to
the deemed part of the Deposit.
(b) Payment at Closing. If the Closing is completed under this
Agreement, Escrowee shall deliver the Deposit to Seller on the Closing Date on
account of the Purchase Price.
(c) Other Payment. Notwithstanding anything contained in this
Agreement, upon receipt of any written notice from Seller or Buyer claiming the
Deposit pursuant to the provisions of this Agreement, Escrowee shall promptly
forward a copy thereof to the other party and, unless such other party within
ten (10) days thereafter notifies Escrowee of any objection to such request for
the disbursement of the Deposit, Escrowee shall disburse the Deposit to the
party demanding the same and Escrowee shall thereupon be released and discharged
from any further duty or obligation under this Agreement.
(d) Stakeholder. Escrowee is acting as a stakeholder only with
respect to the Deposit. If there is any dispute as to whether Escrowee is
obligated to deliver the Deposit, or as to whom the Deposit is to be delivered,
Escrowee may refuse to make any delivery and may continue to hold the Deposit
until receipt by Escrowee of written authorization, signed by
23
both Seller and Buyer, directing the disposition of the Deposit or, in the
absence of such joint written authorization, until final determination of the
rights of the parties in appropriate judicial proceeding. Escrowee may also
bring an appropriate action or proceeding for leave to deposit the Deposit in a
court of competent jurisdiction located in Fairfax, Virginia and to interplead
Seller and Buyer. Upon making delivery of the Deposit, Escrowee shall have no
further liability with respect to the Deposit. Seller and Buyer agree that the
duties of Escrowee in its capacity as escrow holder under this Agreement are
ministerial in nature and that Escrowee shall incur no liability except for its
willful misconduct or gross negligence so long as Escrowee acts in good faith.
(e) Tax Information. The federal tax identification number of
Buyer is 00-0000000. The federal tax identification number of Seller is
00-0000000.
(f) Escrow Fees. Seller and Buyer shall each pay one-half of
the fees and expenses, if any, due to Escrowee as compensation for its escrow
services pursuant to this Agreement, and shall each reimburse Escrowee for
one-half of the expenses incurred by Escrowee in discharging its duties and
obligations as escrow holder under this Agreement.
23. Miscellaneous.
(a) Captions or Headings; Interpretation. The captions or
headings of the Paragraphs and subparagraphs of this Agreement are for
convenience only, and shall not control or affect the meaning or construction of
any of the terms or provisions of this Agreement. Wherever in this Agreement the
singular number is used, the same shall include the plural and vice versa and
the masculine gender shall include the feminine gender and vice versa as the
context shall require.
(b) Amendments and Waivers. No change, alteration, amendment,
modification or waiver of any of the terms or provisions of this Agreement shall
be valid, unless the same shall be in writing and signed by Buyer and Seller.
(c) No Rule of Construction. This Agreement has been
negotiated at arms length by both Seller and Buyer, and no rule of construction
shall be invoked against either party with respect to the authorship thereof or
of any of the documents to be delivered by the respective parties at the
Closing.
(d) Counterparts. This Contract may be executed in multiple
counterparts each of which shall be deemed an original but together shall
constitute one agreement.
(e) Applicable Law. This Agreement shall be governed and
construed according to the laws of the State in which the Premises is located.
24
(f) Right to Waive Conditions or Contingency. Either party may
waive any of the terms and conditions of this Agreement made for its benefit
provided such waiver is in writing and signed by the party waiving such term or
condition.
(g) Partial Invalidity. If any term, covenant, condition or
provision of this Agreement or the application thereof to any person or
circumstance shall be invalid or unenforceable, at any time or to any extent,
the remainder of this Agreement, or the application of such term or provision to
persons or circumstances other than those as to which it is held invalid or
unenforceable, shall not be affected thereby. Each term, covenant, condition and
provision of this Agreement shall be valid and enforced to the fullest extent
permitted by law.
(h) Public Disclosure of Agreement. Seller acknowledges that
Beacon Properties Corporation, the general partner of Buyer, is a publicly owned
corporation subject to regulation by the Securities and Exchange Commission
("SEC"), and that the regulations of the SEC may require that Buyer disclose the
existence of this Agreement and the contents of some or all of the documents and
materials delivered by Seller. Accordingly, Seller expressly consents to the
disclosure of the terms and conditions of this transaction, this Agreement
itself, and terms of any document or materials which Buyer in good faith
believes should be disclosed in connection with fulfillment of its disclosure
requirements under SEC regulations. In addition, following Closing, Buyer shall
have the right to issue press releases announcing this transaction. Seller shall
be entitled to a prior review and approval of the press release.
(i) Property Excluded. This sale does not include, and Seller
shall remove the Premises prior to Closing, the items of personal property
listed on Exhibit L to this Agreement. Prior to the Closing Date, Seller shall
repair in a reasonable manner, all holes and other damage to the building
directly resulting from the removal by Seller from the building of the items of
property not included in this sale.
(j) Agreement Not To Be Recorded. This Agreement shall not be
filed of record by or on behalf of Buyer in any office or place of public
record. If Buyer fails to comply with the terms hereof by recording or
attempting to record this Agreement or a notice thereof, such act shall not
operate to bind or cloud the title to the Premises. Seller shall, nevertheless,
have the right forthwith to institute appropriate legal proceedings to have the
same removed from record. If Buyer or any agent, broker or counsel acting for
Buyer shall cause or permit this Agreement or a copy thereof to be filed in an
office or place of public record, Seller, at its option, and in addition to
Seller's other rights and remedies, may treat such act as a default of this
Agreement on the part of Buyer. However, the filing of this Agreement in any
lawsuit or other proceedings in which such document is relevant or material
shall not be deemed to be a violation of this Paragraph.
(k) Waiver of Tender of Deed and Purchase Monies. The tender
of an executed Deed by Seller and the tender by Buyer of the portion of the
Purchase Price payable at Closing are hereby mutually waived, but nothing herein
contained shall be construed as a waiver
25
of Seller's obligation to deliver the Deed and/or of the concurrent obligation
of Buyer to pay the Purchase Price.
(l) Time of the Essence. Time, wherever specified herein for
the performance by Seller or Buyer of any of their respective obligations
hereunder (including, without limitation the time deadline for Buyer's delivery
of a Termination Notice under Paragraph 16), is hereby made and declared to be
of the essence of this Agreement.
(m) Computation of Periods. If the final day of any period of
time in any provision of this agreement falls upon a Saturday, Sunday or a
holiday observed by federally insured banks in the State in which the Premises
is located or by the United States Postal Service, then, the time of such period
shall be extended to the next day which is not a Saturday, Sunday or holiday.
Unless otherwise specified, in computing any period of time described in this
Agreement, the day of the act or event after which the designated period of time
begins to run is not to be included and the last day of the period is so
computed is to be included, unless such last day is a Saturday, Sunday or
holiday in which event the period shall run until the end of the next day which
is neither a Saturday, Sunday or holiday.
(n) Exhibits. All exhibits annexed to this Agreement
are incorporated by reference into and made a part of this Agreement.
(o) Right to Audit. Pursuant to Paragraph 16(d), Seller has
furnished or made available to Buyer certain financial statements and balance
sheets for the Property. In order to comply with SEC regulations, Buyer may need
the right prior to or subsequent to Closing, to conduct an audit of Seller's
books and records for the Property in conformity with Section 3.14 of SEC
Regulation SX for 1994, 1995, 1996 and/or for Seller's period of ownership
during the year in which the Closing occurs. Seller hereby agrees to permit
Buyer and Buyer's accountants access to such books and records (including those
maintained by Manager) and to cooperate with Buyer, and to cause Seller's
accountants to cooperate with Buyer, at no cost to Seller, to enable such audit
to be performed. Buyer agrees that no information disclosed in such audit will
alter any obligation of Buyer. The provisions of this Paragraph 23(o) shall
survive the Closing indefinitely.
26
IN WITNESS WHEREOF, the parties, intending legally to be bound, have
executed this Agreement as of the date first above written.
SELLER:
XXXXXX REALTY CORPORATION
By: /s/ Xxxxxxx X. Xxxxxx
________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Executive Vice President
BUYER:
BEACON PROPERTIES, L.P.
By: Beacon Properties Corporation
General Partner
By: /s/ Xxxxxxx X. Xxxxxxx
____________________________
Name: Xxxxxxx X. Xxxxxxx
Title: Senior Vice President
27
OPTION AGREEMENT
THIS OPTION AGREEMENT (this "Agreement") made this ____ day of
___________________, 1997 by and between CENTERPOINTE III LIMITED PARTNERSHIP, a
Delaware limited partnership ("Seller") and BEACON PROPERTIES, L.P., a Delaware
limited partnership ("Buyer").
W I T N E S S E T H:
In consideration of the covenants and provisions contained herein, the
parties agree as follows:
1. Grant.
(a) For and in consideration of the sum of _________________ Dollars
($____________) paid by Buyer on the signing of this Agreement, receipt of which
is hereby acknowledged by Seller, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Seller and Buyer grant
to the other the right, privilege and option, exercisable on the terms set out
below in Paragraph 2 (the "Option"), to effect the sale of that certain lot or
piece of ground containing approximately 7.85 acres and situate in Fairfax,
Virginia, which is more fully described by metes and bounds on Exhibit A to this
Agreement (the "Real Property"), together with all rights and appurtenances
pertaining to the Real Property, including any right, title and interest of
Seller in and to adjacent streets and rights-of-way, and Seller's interests in
the Intangible Personal Property (defined below). Seller and Buyer stipulate and
agree that the Real Property has the potential for approximately 341,948 square
feet of developable office space (the "Agreed Amount of Developable Office
FAR").
(b) The Intangible Personal Property shall refer to the interests of
Seller in all existing surveys, consents, authorizations, variances or waivers,
licenses, permits and approvals from any governmental or quasi-governmental
agency, department, board, commission, bureau or other instrumentality (all to
the extent assignable or transferable) with respect to the Real Property. The
Real Property and Intangible Personal Property are collectively referred to as
the "Property."
(c) Concurrently with the execution of this Agreement, the parties
have executed a Memorandum of Option (the "Memorandum") which Buyer may, at its
election, record with the Office of the Clerk of the Circuit Court of Fairfax
County, Virginia (the "Recorder's Office"), and have also executed and delivered
to Commonwealth Land Title Insurance Company (the "Escrowee") to be held in
escrow a Termination of Memorandum of Option (the "Termination") pending
termination of this Agreement or the completion of Closing.
2. Exercise.
1
(a) Subject to Paragraphs 2(c) and 2(d) below, the Option may be
exercised by Buyer or Seller by written notice (the "Option Notice") given to
the other party on or before the Option Expiration Date. The "Option Expiration
Date" shall be the earlier to occur of (I______,2000 [insert day which is three
(3) years from the date of this Agreement] or (ii) the date which is forty-five
(45) days after the date Buyer receives written notice from Seller that Seller
intends to begin development of the Real Property. In no event may Seller
deliver the notice contemplated by clause (ii) of the immediately preceding
sentence prior to the earlier of January 1, 1998 or the date of the Final Local
Master Plan Amendment (as defined in Paragraph 14, below). The period from the
date of this Agreement to the Option Expiration Date is called the "Term of the
Option." If the Option is not exercised on or before the Option Expiration Date,
this Agreement shall automatically terminate, neither party shall have any
further obligations hereunder and Escrowee is authorized and directed to record
the Termination in the Recorder's Office. If, however, the Option is exercised
by Buyer or Seller on or before the Option Expiration Date, this Agreement,
together with the Option Notice from the party exercising this Option, shall be
deemed to be an Agreement of Sale and Purchase between Seller and Buyer with
respect to the Property pursuant to the terms and provisions set forth below,
without the necessity of any further act or agreement.
(b) If not previously exercised by Seller, Buyer shall have the right
to exercise the Option at any time during the Term of the Option. To be
effective, Buyer's Option Notice must be accompanied by delivery of the sum of
Two Hundred Fifty Thousand Dollars ($250,000) (the "Deposit") to Escrowee. The
Deposit shall be held by Escsrowee in accordance with the provisions of
Paragraph 22 of this Agreement.
(c) If not previously exercised by Buyer, Seller shall have the right
to exercise the Option during the period commencing sixty (60) days prior to the
Option Expiration Date and expiring on the Option Expiration Date; provided,
that prior to such exercise of the Option the Average Appraised Value (as
defined below) of the Property shall have first been established and that the
Average Appraised Value of the Property is equal to or greater than $3,419,480.
Within thirty (30) days after receipt of a request from Seller ("Seller's
Appraisal Request"), Buyer shall engage a Qualified Appraiser to prepare an MAI
appraisal of the Property. A "Qualified Appraiser" is an appraiser having not
less than five (5) years' appraisal experience in the Fairfax County, Virginia
market area. Seller shall also engage a Qualified Appraiser to perform such an
appraisal of the Property. In preparing such appraisals, the appraisers shall be
instructed to assume that the Real Property has been zoned to permit an office
use development of not less than the Agreed Amount of Developable Office FAR and
to prepare the appraisal in accordance with the instructions set forth on
Schedule 2(c) to this Agreement. The Qualified Appraisers so engaged shall
deliver their appraisal reports within thirty (30) days after being so engaged.
If the value of the Property reported by either appraisal is five percent (5%)
or less than the value reported by the other, then the "Average Appraised Value"
of the Property shall be the average of the two (2) appraisals. If the values
are more than five percent (5%) apart, then within ten (10) days after
submission of the last of the appraisals to be submitted to either Seller or
Buyer, the two (2) Qualified Appraisers shall engage a third Qualified Appraiser
to prepare such an appraisal of the Property and to deliver such appraisal
2
report to Seller and Buyer within thirty (30) days after being so engaged. In
such event, the Average Appraised Value of the Property shall be equal to
average of the two closest appraised values, unless one of the three appraised
values is equidistant from the other two, in which case the Average Appraised
Value shall equal such middle appraised value. If the Qualified Appraiser
selected by either buyer or Seller does not submit its appraisal report within
the time period specified above, the appraised value reported by the Qualified
Appraiser which does timely submit its report shall constitute the Average
Appraised Value of the Property. Each party shall pay the costs of any Qualified
Appraiser selected by it, and shall pay one-half of the costs charged by the
third Qualified Appraiser.
(d) If not previously exercised by either party, Seller shall have the
right to exercise the Option at any time during the Term of the Option if Seller
executes a New AMS Lease. A "New AMS Lease" shall be a lease agreement (i) with
American Management Systems, Inc. ("AMS") to lease space exceeding 200,000
rentable square feet within a new, build-to-suit office building to be built on
the Real Property, (ii) which shall yield to Buyer a Stabilized Return (as
defined in Schedule 2(d) of ten percent (10%) per annum (cash on bona fide
third-party costs) on all Budgeted Development Costs (as defined in Schedule
2(d)), and (iii) which shall otherwise be substantially in the form of the
existing AMS Lease for Centerpointe I and II, shall provide a reasonable,
realistic time frame for the delivery of the leased space, and shall be for a
term of not less than ten (10) years with no contingencies or termination rights
prior to the tenth year of the term in favor of AMS (other than reasonable and
customary termination rights for failure to timely complete construction or
failure to rebuild following casualty or eminent domain).
3. Purchase Price.
(a) The purchase price (the "Purchase Price") to be paid by Buyer to
Seller for the Property shall be a sum calculated as follows:
(i) If Buyer exercises the Option pursuant to Paragraph 2(b),
the Purchase Price shall be the product of the Agreed Amount of Developable
Office FAR multiplied by:
(A) subject to the provisions of Paragraph 3(a)(i)(B),
Eighteen Dollars and Thirty Five Cents ($18.35) if Buyer exercises the Option
during the period from the date of this Agreement to and including the day
immediately preceding the first anniversary of the date of this Agreement;
(B) notwithstanding the provisions of Paragraph 3(a)(i)(A),
Twenty Dollars ($20.00) if Buyer exercises the Option during the period
beginning on the date Seller gives Buyer written notice that Seller has entered
active negotiations with AMS for the New AMS Lease to and including the first
anniversary of the date of this Agreement; provided, that if Seller fails to
execute a New AMS Lease within four (4) months following the date of Buyer's
exercise of the Option, this Paragraph 3(a)(i)(B) shall be of no
3
force or effect and the calculation of the Purchase Price shall
be governed by Paragraph 3(a)(i)(A);
(C) Twenty Dollars ($20.00) if Buyer exercises the Option
during the period beginning on the first anniversary of the date of this
Agreement to and including the day immediately preceding the second anniversary
of the date of this Agreement; and
(D) Twenty One Dollars and Eighty Cents ($21.80) if Buyer
exercises the Option during the period beginning on the second anniversary of
the date of this Agreement to and including the Option Expiration Date.
(ii) If Seller exercises the Option pursuant to Paragraph
2(c), the Purchase Price shall equal the greater of (A) $4,428,226.60 (which
amount equals the product obtained by multiplying the Agreed Amount of
Developable Office FAR times $12.95) or (B) the Average Appraised Value.
(iii) If Seller exercises the Option pursuant to Paragraph
2(d) prior to the second anniversary of the date of this Agreement, the Purchase
Price shall equal $6,838,960 (which amount equals the product obtained by
multiplying the Agreed Amount of Developable Office FAR times $20.00).
(iv) If Seller exercises the Option pursuant to Paragraph 2(d)
on or after the second anniversary of the date of this Agreement, the Purchase
Price shall equal $7,454,466 (which amount equals the product obtained by
multiplying the Agreed Amount of Developable Office FAR times $21.80).
(b) Buyer shall pay the Purchase Price at Closing by wire transfer of
immediate United States federal funds to Seller's account at a bank designated
by Seller.
4. Closing. Closing shall commence at 10:00 a.m. on the date which is
thirty (30) days after the date of the Option Exercise Notice (the "Closing
Date") at the offices of Wolf, Block, Xxxxxx and Xxxxx-Xxxxx, Twelfth Floor
Packard Building, 15th and Xxxxxxxx Xxxxxxx, Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000;
provided, if such thirtieth day is a Saturday, Sunday or a holiday observed by
federally insured banks in the State in which the Real Property is located, the
Closing Date shall be the next day which is not a Saturday, Sunday or holiday.
5. Condition of Title.
(a) Title to Real Property. Fee simple title to the
Real Property shall be conveyed by Seller to Buyer at the completion of Closing
by a deed (the "Deed") containing Seller's special warranty in substantially the
form of Exhibit C-1 to this Agreement, excluding from such warranty the
Permitted Exceptions (as defined below). Title to the Intangible Personal
Property shall be conveyed by Seller to Buyer at the completion of Closing by a
xxxx of
4
sale ("Xxxx of Sale") in substantially the form of Exhibit C-2 to this
Agreement. Title to the Property shall be such as will be insured as good and
marketable by Escrowee pursuant to the standard stipulations and conditions of
the most current form of ALTA Policy of Owner's Title Insurance then in use in
the State in which the Real Property is located, free and clear of all liens and
encumbrances except for the Permitted Exceptions. Buyer will pay the premium for
the owner's policy and the cost of any endorsements to such policy. The term
"Permitted Exceptions" shall mean the title exceptions set forth on Exhibit B to
this Agreement.'
(b) Failure of Title. If on the Closing Date title to the
Property is not insurable as set forth in Paragraph 5(a) above, Buyer may elect,
as its sole right and remedy, either (i) to take such title to the Property as
Seller can convey without abatement of the Purchase Price except for liens and
encumbrances securing the payment of money which were voluntarily created by
Seller and mechanic's liens or (ii) to terminate this Agreement by written
notice to Seller and Escrowee and be paid the Deposit. Notwithstanding the
foregoing provisions, Buyer agrees to accept title to the Property subject to
judgments against Seller if Buyer's title insurer insures Buyer against loss by
reason of such judgments.
6. Possession. Possession of the Property is to be given by
Seller to Buyer at the completion of Closing by delivery of the
Deed.
7. Closing: Apportionments.
(a) Items to be Apportioned. Personal property taxes, real
estate taxes and annual municipal or special district assessments (on the basis
of the actual fiscal years for which such taxes are assessed), prepaid fees for
licenses and permits to remain in effect for Buyer's benefit after Closing shall
be apportioned at Closing pro rata between Buyer and Seller on a per diem basis
as of the Closing Date.
(b) Unpaid Real Estate Taxes. If, on the Closing Date, bills
for real estate taxes imposed upon the Property for any part of the tax fiscal
years in which Closing occurs have been used but shall not have been paid, such
taxes shall be paid at the time of Closing.
(c) Transfer Tax. Buyer shall pay the state and county realty
transfer taxes imposed in connection with the Deed or transactions contemplated
by this Agreement. Seller shall pay the grantor's tax imposed in connection with
the Deed or transactions contemplated by this Agreement.
8. Seller's Representations and Warranties.
(a) Seller represents and warrants to Buyer as follows:
5
(i) Organization. Seller is a limited partnership, duly
organized and validly subsisting under the laws of the State of Delaware and has
all requisite partnership power and authority to carry on its business as now
conducted.
(ii) Authorization. Seller has all requisite partnership power
and authority to enter into and perform this Agreement, and Seller has duly
authorized the execution and performance of this Agreement. No consent or
approval from any third party is required in order to enable Seller to execute
this Agreement and perform its obligations hereunder.
(iii) No Condemnation. To Seller's knowledge, there are no
existing or pending condemnation proceedings affecting the Property, nor, to
Seller's actual knowledge, have any such condemnation proceedings been overtly
threatened.
(iv) No Proceedings. Except as set forth on Schedule 8(a)(iv)
to this Agreement, Seller has received no written notice of any pending actions,
suits or proceedings against Seller or the Property nor, to Seller's knowledge,
is there any action, suit or proceeding against Seller or the Property
threatened which would prevent consummation by Seller of the sale of the
Property or materially and adversely affect the performance of any of Seller's
other obligations to be performed under this Agreement. Seller has not received
any written notice from any governmental authority claiming a violation or
alleged violation of any law, rule, ordinance or code with respect to the
Property which remains uncured.
(b) All references in this Paragraph 8 or elsewhere in this
Agreement to "Seller's knowledge" shall refer solely to the actual knowledge of
Xxxxxxx X. Xxxxxx, Xxxxxxx X. Xxxxx and Xxxxxx Xxxxxxxx and shall not be
construed to refer to the knowledge of any other employee, officer, director,
shareholder or agent of Seller or any affiliate of Seller, and shall not include
imputed or constructive knowledge.
9. Buyer's Representations and Warranties. Buyer hereby
represents and warrants to Seller as follows:
(a) Organization. Buyer is a limited partnership duly
organized and validly existing under the laws of the State of Delaware and has
all requisite partnership power and authority to carry on its business as now
conducted.
(b) Authorization. Buyer has all requisite partnership power
and authority to enter into and perform this Agreement and Buyer has duly
authorized the execution and performance of this Agreement. Buyer has received
all approvals (except any approvals to be obtained during the Inspection Period)
necessary to consummate the transactions described herein.
10. Conditions to Closing.
6
(a) Buyer shall not be obligated to complete Closing under
this Agreement unless each of the following conditions shall be fulfilled on the
Closing Date:
(i) Title Policy. Escrowee or another title insurance
company authorized to transact business in the State of Virginia reasonably
acceptable to Buyer and Buyer's counsel shall commit in writing to Buyer to
issue an owner's policy of title insurance as described in Paragraph 5(a).
(ii) Accuracy of Representations. The representations and
warranties made by Seller in this Agreement shall be true and correct as of the
Closing Date in all material respects.
(iii) Seller's Performance. Seller shall have complied with
and performed in all material respects all of its obligations under this
Agreement.
(b) Seller shall not be obligated to complete Closing under
this Agreement unless Buyer shall have paid the Purchase Price and shall have
complied with and performed in all material respects all of its other
obligations under this Agreement.
11. Deliveries at Closing.
(a) Seller's Deliveries. On the Closing Date, Seller
shall deliver to Buyer the following:
(i) Transfer Documents. The Deed and Xxxx of Sale.
(ii) Authority Documents. A resolution, to evidence
Seller's authorization of performance of this Agreement and an
incumbency certificate to evidence the capacity of the signatory
for Seller.
(iii) FIRPTA Certification and Title Affidavit. A
certificate in the form attached to this Agreement as Exhibit D with respect to
compliance with the Foreign Investment in Real Property Tax Act (Internal
Revenue Code Section 1445, as amended, and the regulations issued thereunder)
and an affidavit in the form of Exhibit E in favor of the title insurer who will
insure Buyer's title to the Property (which affidavit shall in no event expand
Seller's warranty contained in the Deed).
(iv) Original Documents. The originals (to the extent
in Seller's possession) of all Intangible Personal Property.
(v) Seller's Closing Certificate. An executed
original of the Seller's Closing Certificate in the form attached
as Exhibit F.
7
(vi) Closing Statement. An executed original Closing
Statement setting forth the calculation of the Purchase Price and
the prorations provided for hereunder.
(vii) Transfer Tax Forms. An executed original of any
transfer tax forms required in connection with Closing.
(viii) New AMS Lease. If the Closing is occurring as a
result of an exercise of the Option by Seller under Paragraph 2(d), Seller shall
also deliver an executed original of the New AMS Lease, an estoppel certificate
from AMS and any security deposit being held by Seller thereunder.
(ix) Other Documents. Any other documents which
Seller is obligated to deliver pursuant to this Agreement.
(b) Buyer's Deliveries. On the Closing Date, Buyer will
deliver to Seller the following:
(i) Authority Documents. A resolution, to evidence
Buyer's authorization of performance of this Agreement, and an
incumbency certificate to evidence the capacity of the signatory
for Buyer.
(ii) Purchase Price. That portion of the Purchase
Price payable at Closing.
(iii) Buyer's Closing Certificate. An executed original of
the Buyer's Closing Certificate in the form attached as Exhibit G.
(iv) Closing Statement. An executed original Closing
Statement setting forth the calculation of the Purchase Price and
the prorations provided for hereunder.
(v) Transfer Tax Forms. An executed original of any
transfer tax forms required in connection with Closing.
(vi) Other Documents. Any other documents which Buyer
is obligated to deliver pursuant to this Agreement.
12. Default
(a) Buyer Default. If Buyer defaults under this Agreement at
the Closing Date by failing to complete Closing in accordance with the terms of
this Agreement, then, provided Buyer has posted the Deposit, on the Closing Date
Seller shall be entitled, as Seller's sole and exclusive remedy at law or in
equity for such default by Buyer hereunder, to be
8
paid the Deposit as liquidated damages and not as a penalty. In such event,
Seller and Buyer agree that the actual damages to Seller in the event of such
default are impractical to ascertain as of the date of this Agreement and that
the amount of the Deposit is a reasonable estimate thereof. Nothing in this
Paragraph, however, shall limit Seller's rights against Buyer by reason of any
indemnity obligations of Buyer to Seller set forth in this Agreement, all of
which shall survive the termination of this Agreement. Notwithstanding the
foregoing, if Buyer has not posted a Deposit by reason of the Option having been
exercised by Seller, and if Buyer defaults under this Agreement at the Closing
Date by failing to complete Closing in accordance with the terms of this
Agreement, then Seller shall be entitled to pursue all remedies available to
Seller at law or in equity including, without limitation, the right to institute
an action for specific performance of this Agreement.
(b) Seller Default. If Seller defaults under this Agreement at
or prior to the Closing Date by failing to complete Closing in accordance with
the terms of this Agreement, then on the earlier of the Closing Date or the date
of Seller's default, Buyer shall be entitled, as Buyer's sole and exclusive
remedy, to institute an action for specific performance of this Agreement.
13. Notices.
(a) All notices given by either party to the other shall be in
writing and shall be sent either (i) by United States Postal Service registered
or certified mail, postage prepaid, return receipt requested, (ii) by nationally
recognized overnight courier service for next business day delivery, addressed
to the other party at the addresses listed below or (iii) via telecopier or
facsimile transmission to the facsimile numbers listed below, provided, however,
that if such communication is given via telecopier or facsimile transmission, an
original counterpart of such communication shall concurrently be sent in the
manner specified in clause (ii) above. Addresses and facsimile numbers of the
parties are as follows:
As to Seller:
c/o GE Investments
0000 Xxxxxx Xxxxxx
P.O. Box 7900
Stamford, Connecticut 06905
Attention: Xxxxxxx X. Xxxxx
Fax: (000) 000-0000
with copies at
the same time to:
Centerpointe III Limited Partnership
c/o GE Investments
0000 Xxxxxx Xxxxxx
9
X.X. Xxx 0000
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx, Esquire
Fax: (000) 000-0000
and
Wolf, Block, Xxxxxx and Xxxxx-Xxxxx
Twelfth Floor Packard Building
00xx xxx Xxxxxxxx Xxxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxx, Esquire
Fax: (000) 000-0000
As to Buyer:
Beacon Properties, L.P.
00 Xxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xx. Xxxx X'Xxxxx
Fax: (000) 000-0000
with a copy at
the same time to:
Beacon Properties Corporation
00 Xxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxx, Esquire, General
Counsel
Fax: (000) 000-0000
and to
Goulston & Storrs
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Jordan X. Xxxxxxx, Esquire
Fax: (000) 000-0000
As to Escrowee:
Commonwealth Land Title Insurance Company
00 Xxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
10
Attention: Xxxxxxx Xxxxxxx
Fax: (000) 000-0000
or to such other address as the respective parties may hereafter designate by
notice in writing in the manner specified above. Any notice may be given on
behalf of any party by its counsel.
(b) Notices given in the manner aforesaid shall be deemed
sufficiently served or given for all purposes under this Agreement upon the
earlier of (i) actual receipt or refusal by the addressee or (ii) one (1) day
following the date such notices, demands or requests shall be deposited in any
Post Office, or branch Post Office regularly maintained by the United States
Government or delivered to the overnight courier service.
14. Operations Prior to Exercise and Closing. During the Term of the
Option, Seller shall diligently pursue such amendments to the local master plan
for the Real Property necessary to change approved use of the Real Property to
office use and to permit the actual developable FAR to equal or exceed the
Agreed Amount of Developable FAR, until such amendments have been approved and
all appeal periods have expired without an appeal being granted (the "Final
Local Master Plan Amendment"). Seller and Buyer shall share equally the bona
fide third-party costs of Seller's efforts to obtain the Final Local Master Plan
Amendment, including (without limitation) the costs of engineering, surveying
and zoning counsel. During the Term of the Option, Buyer shall have the right to
prepare and submit to Seller applications for rezoning the Real Property, which
applications Seller in its sole discretion shall approve or disapprove for
submission to the appropriate zoning authorities, such approval or disapproval
to be based on the form of each such application and Seller's determination
whether the timing of submission of each application would interfere with the
pursuit of the Final Local Master Plan Amendment. If Seller approves the
application, Seller shall submit the application to the appropriate zoning
authority, and the bona fide third-party costs of such submission shall be
Buyer's sole cost and expense. Following the exercise of the Option by either
party, Buyer shall take over and thereafter control, at Buyer's sole cost and
expense any procedures then pending for the amendment to such master plan and/or
rezoning of the Real Property; provided, Buyer shall not be obligated to
reimburse Seller for Seller's share of any such costs incurred by Seller prior
to the exercise of the Option. Seller shall reasonably cooperate with Buyer in
transitioning control of such pending matters to Buyer prior to Closing. During
the Term of the Option, Seller shall also have the right to enter leases with
tenants for space in one or more buildings to be constructed on the Real
Property, provided that such leases contain provisions subordinating the
leasehold to Buyer's rights under the Option. Seller shall from time to time
keep Buyer reasonably well advised of all prospective lease transactions which
Seller may elect to pursue, and shall provide Buyer with a copy of any such
lease promptly after executing same.
15. Assignability.
(a) Limited Assignment. Subject to the limitations set
forth in subparagraph (b) below, this Agreement and all, but not
part, of Buyer's rights under this Agreement may be assigned by
Buyer, without the prior written consent of Seller, to an entity
11
which is qualified to do business in the State in which the Property is located
and in which Buyer (and/or Beacon Properties Corporation ("BP"), and/or one or
more entities 100% owned and controlled by Buyer and/or B.C.) owns for its own
account not less than one hundred percent (100%) of the ownership interests
therein and maintains control over the management and affairs of the entity;
provided, however, that such assignment shall not release or relieve Buyer of
and from any liability or obligation under this Agreement, and Buyer shall
continue to be primarily liable to Seller under this Agreement. No such
assignment shall be effective, however, unless and until Buyer shall have
furnished to Seller both an executed copy of the assignment plus a written
assumption agreement, in form satisfactory to Seller, by the assignee to assume,
perform and be responsible, jointly and severally with the Buyer named herein,
for the performance of all of the obligations of Buyer under this Agreement and
to pay all additional transfer or documentary taxes imposed as a result of such
assignment, and which contains a representation by the assignee that all of the
representations and warranties made by Buyer in this Agreement are true and
correct with respect to the assignee as of the date of the assumption agreement.
Seller shall have the right to rely in good faith on the genuineness and
validity of the notice from Buyer of an assignment and to convey the Property to
the assignee without liability to Buyer or any other person.
(b) Prohibited Assignments. Notwithstanding the foregoing
provisions of subparagraph (a), Buyer shall have no right to assign this
Agreement to any entity owned or controlled by an employee benefit plan if
Seller's sale of the Property to such entity would, in the judgment of Seller's
counsel, either create, otherwise cause, or raise a material question as to
whether it would create or otherwise cause, a "prohibited transaction" under the
Employee Retirement Income Security Act of 1974, as amended ("ERISA").
(c) Successors and Assigns. Except as provided in subparagraph
(a), Buyer may not assign or suffer an assignment of this Agreement and its
rights under this Agreement. Subject to the foregoing limitations, this
Agreement shall extend to, and shall bind, the respective heirs, executors,
personal representatives, successors and assigns of Seller and Buyer.
16. Intentionally Omitted.
17. Condemnation.
(a) Immaterial Taking. If any part of the Property shall be
taken by exercise of the power of eminent domain after the date of this
Agreement, this Agreement shall continue in full force and effect and there
shall be no abatement of the Purchase Price. Seller shall be relieved, however,
of its duty to convey title to the portion so taken, but Seller shall, on the
Closing Date, assign to Buyer all rights and claims to any awards arising
therefrom as well as any money theretofore received by Seller on account thereof
net of any expenses to Seller, including attorneys' fees of collecting the same.
Seller shall promptly furnish Buyer with a copy of the declaration of taking
promptly after Seller's receipt thereof.
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(b) Material Taking. If any such taking of a portion of the
Property materially interferes with the use of the Property for the purposes for
which the Buyer intends, either Seller or Buyer may terminate this Agreement by
written notice to the other party. Upon such termination, the Deposit shall be
returned by Escrowee to Buyer and neither party shall have any further rights or
obligations hereunder.
18. Brokers. Each party represents and warrants to the other that it
has dealt with no broker or other intermediary in connection with this
transaction or the Property other than Xxxxxxx & Xxxxxxxxx (the "Disclosed
Broker"), whose fees shall be payable by Seller pursuant to a separate agreement
between Seller and Disclosed Broker, and Buyer shall have no liability or
obligation in connection therewith. Each party shall indemnify, defend and save
harmless the other of and from any claim for commission or compensation by any
other broker or other intermediary claiming through the indemnifying party. The
provisions of this Paragraph shall survive Closing.
19. CONDITION OF PROPERTY.
(a) ENTIRE AGREEMENT. THE ENTIRE AGREEMENT BETWEEN SELLER AND
BUYER WITH RESPECT TO THE PROPERTY AND THE SALE THEREOF IS EXPRESSLY SET FORTH
IN THIS AGREEMENT. THE PARTIES ARE NOT BOUND BY ANY AGREEMENTS, UNDERSTANDINGS,
PROVISIONS, CONDITIONS, REPRESENTATIONS OR WARRANTIES (WHETHER WRITTEN OR ORAL
AND WHETHER MADE BY SELLER OR ANY AGENT, EMPLOYEE OR PRINCIPAL OF SELLER OR ANY
OTHER PARTY) OTHER THAN AS ARE EXPRESSLY SET FORTH IN THIS AGREEMENT. WITHOUT IN
ANY MANNER LIMITING THE GENERALITY OF THE FOREGOING, BUYER ACKNOWLEDGES THAT IT
AND ITS REPRESENTATIVES HAVE FULLY INSPECTED THE PROPERTY OR HAVE BEEN PROVIDED
WITH AN ADEQUATE OPPORTUNITY TO DO SO, ARE OR WILL BE FULLY FAMILIAR WITH THE
FINANCIAL AND PHYSICAL (INCLUDING WITHOUT LIMITATION, ENVIRONMENTAL) CONDITION
THEREOF, AND THAT THE PROPERTY HAS BEEN PURCHASED BY BUYER IN AN "AS IS" AND
"WHERE IS" CONDITION AND WITH ALL EXISTING DEFECTS AS A RESULT OF SUCH
INSPECTIONS AND INVESTIGATIONS AND NOT IN RELIANCE ON ANY AGREEMENT,
UNDERSTANDING, CONDITION, WARRANTY (INCLUDING, WITHOUT LIMITATION, WARRANTIES OF
HABITABILITY, MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE) OR
REPRESENTATION MADE BY SELLER OR ANY AGENT, EMPLOYEE OR PRINCIPAL OF SELLER OR
ANY OTHER PARTY AS TO THE FINANCIAL OR PHYSICAL (INCLUDING, WITHOUT LIMITATION,
ENVIRONMENTAL) CONDITION OF THE PROPERTY AS TO ANY MATTER, INCLUDING WITHOUT
LIMITATION AS TO ANY PERMITTED USE THEREOF, THE ZONING CLASSIFICATION THEREOF OR
COMPLIANCE THEREOF WITH FEDERAL, STATE OR LOCAL LAWS, AS TO INCOME OR EXPENSES
IN CONNECTION THEREWITH, OR AS TO ANY OTHER MATTER IN CONNECTION THEREWITH,
EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT OR IN ANY INSTRUMENT
13
TO BE DELIVERED TO BUYER BY SELLER AT CLOSING. BUYER ACKNOWLEDGES THAT NEITHER
SELLER, NOR ANY AGENT OR EMPLOYEE OF SELLER NOR ANY OTHER PARTY ACTING ON BEHALF
OF SELLER HAS MADE OR SHALL BE DEEMED TO HAVE MADE ANY SUCH AGREEMENT,
CONDITION, REPRESENTATION OR WARRANTY EITHER EXPRESSED OR IMPLIED, OTHER THAN AS
ARE EXPRESSLY SET FORTH IN THIS AGREEMENT OR IN ANY INSTRUMENT TO BE DELIVERED
TO BUYER BY SELLER AT CLOSING. THIS PARAGRAPH SHALL SURVIVE CLOSING.
(b) RELEASE. WITHOUT LIMITING THE PROVISIONS OF SUBPARAGRAPH
(a) ABOVE AND NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS
AGREEMENT, BUYER HEREBY RELEASES SELLER AND (AS THE CASE MAY BE) SELLER'S
OFFICERS, DIRECTORS, SHAREHOLDERS, TRUSTEES, PARTNERS, EMPLOYEES, MANAGERS AND
AGENTS FROM ANY AND ALL CLAIMS, DEMANDS, CAUSES OF ACTIONS, LOSSES, DAMAGES,
LIABILITIES, COSTS AND EXPENSES (INCLUDING ATTORNEYS' FEES WHETHER THE SUIT IS
INSTITUTED OR NOT) WHETHER KNOWN OR UNKNOWN, LIQUIDATED OR CONTINGENT
(HEREINAFTER COLLECTIVELY CALLED THE "CLAIMS") ARISING FROM OR RELATING TO (i)
ANY DEFECTS IN THE PROPERTY WHETHER THE SAME ARE THE RESULT OF NEGLIGENCE OR
OTHERWISE, OR (ii) ANY OTHER CONDITIONS, INCLUDING ENVIRONMENTAL AND OTHER
PHYSICAL CONDITIONS, AFFECTING THE PROPERTY WHETHER THE SAME ARE A RESULT OF
NEGLIGENCE OR OTHERWISE. THE RELEASE SET FORTH IN THIS SECTION SPECIFICALLY
INCLUDES, WITHOUT LIMITATION, ANY CLAIMS (INCLUDING INDEMNITY AND CONTRIBUTION
CLAIMS) ARISING UNDER ANY ENVIRONMENTAL LAWS OF THE UNITED STATES, THE STATE IN
WHICH THE PROPERTY IS LOCATED OR ANY POLITICAL SUBDIVISION THEREOF OR UNDER THE
AMERICANS WITH DISABILITIES ACT OF 1990, AS ANY OF THOSE LAWS MAY BE AMENDED
FROM TIME TO TIME AND ANY REGULATIONS, ORDERS, RULES OF PROCEDURES OR GUIDELINES
PROMULGATED IN CONNECTION WITH SUCH LAWS, REGARDLESS OF WHETHER THEY ARE IN
EXISTENCE ON THE DATE OF THIS AGREEMENT.
(c) NOTHING IN SUBPARAGRAPH 19(b) SHALL CONSTITUTE A RELEASE
OF SELLER FOR ANY CLAIM MADE BY A THIRD PARTY AGAINST BUYER ASSERTING INJURY OR
DAMAGE TO SUCH THIRD PARTY ARISING DURING SELLER'S OWNERSHIP OF THE PREMISES,
PROVIDED (i) BUYER DELIVERS WRITTEN NOTICE TO SELLER OF THE THIRD PARTY CLAIM
WITHIN THIRTY (30) DAYS AFTER BUYER'S RECEIPT OF THE THIRD PARTY CLAIM, (ii)
SELLER SHALL BE PERMITTED TO INTERVENE IN DEFENDING THE THIRD PARTY CLAIM AND
(iii) BUYER DOES NOT SETTLE THE THIRD PARTY CLAIM WITHOUT THE WRITTEN CONSENT OF
SELLER. A THIRD PARTY DOES NOT INCLUDE ANY DIRECT OR INDIRECT PRINCIPAL OR
AFFILIATE OF BUYER. NOTWITHSTANDING ANYTHING CONTAINED IN THIS PARAGRAPH, BUYER
AGREES THAT SELLER SHALL HAVE NO LIABILITY TO BUYER UNDER THIS PARAGRAPH
(WHETHER BY REIMBURSEMENT OR CONTRIBUTION UNDER ENVIRONMENTAL LAWS OR OTHERWISE)
FOR THE
14
COST OF ANY CLEANUP, REMEDIATION OR REMOVAL OF HAZARDOUS SUBSTANCES, FOR THE
COST OF ANY REPAIRS OR REPLACEMENTS TO THE PREMISES, OR FOR ANY OTHER COSTS OF
REMEDIATING THE CONDITION GIVING RISE TO THE THIRD PARTY CLAIM (TOGETHER,
"REMEDIATION COSTS") OR FOR BUYER'S LEGAL FEES AND COURT COSTS IN DEFENDING A
THIRD PARTY CLAIM. BUYER SHALL PAY ALL REMEDIATION COSTS AND BUYER'S LEGAL FEES
AND COURT COSTS. SELLER SHALL PAY ITS LEGAL FEES AND COURT COSTS.
(d) Effect of Disclaimers. Buyer acknowledges and agrees that
the Purchase Price has been negotiated to take into account that the Property is
being sold subject to the provisions of this Paragraph 19 and that Seller would
have charged a higher purchase price if the provisions in this Paragraph 19 were
not agreed upon by Buyer.
20. Survival of Provisions.
(a) Notwithstanding any provision to the contrary set forth in
this Agreement, the agreements and obligations of Buyer under Paragraph 7,
16(a), 16(e), 16(f), 18, and 19 shall survive Closing, and the warranties and
representations of Buyer set forth in Paragraph 9 shall survive Closing under
this Agreement for a period of six (6) months.
(b) (i) Notwithstanding any provision to the contrary set
forth in this Agreement, the agreements and obligations of Seller under
Paragraph 7 and 18 shall survive Closing, and the warranties and representations
of Seller set forth in Paragraph 8(a) (the "Surviving Warranties") shall survive
Closing under this Agreement for a period of six (6) months.
(ii) If Buyer determines that any of the Surviving
Warranties are breached prior to the Closing Date, Buyer's sole right and remedy
shall be to terminate this Agreement by giving to Seller written notice of such
termination on or prior to the Closing Date. If Buyer fails to timely given such
written termination notice to Seller, Buyer shall be deemed to have waived any
right or remedy (including, without limitation, any right under this Agreement
to terminate this Agreement) against Seller by reason of the breach of such
warranty. If Buyer terminates this Agreement pursuant to this Paragraph, Buyer
shall be entitled to the return of the Deposit, and upon the return of the
Deposit to Buyer, neither Buyer nor Seller shall have any further rights nor
obligations under this Agreement.
(iii) Seller shall have no liability to Buyer by reason or
a breach or default of any of the Surviving Warranties unless Buyer shall have
given to Seller written notice ("Warranty Notice") of such breach or default
within six (6) months of the Closing Date, and shall have given to Seller an
opportunity to cure any such breach or default within a reasonable period of
time after Buyer's learning of such breach of warranty. In no event shall
Seller's liability to Buyer by reason of a breach or default of any or all of
the Surviving Warranties exceed $500,000, and Seller shall have no liability to
Buyer for breach of the Surviving Warranties except to the extent of the loss
incurred by Buyer as a result thereof
15
exceeds $500,000. Any litigation to enforce any Surviving Warranty must be
commenced within three (3) months from the date of the Warranty Notice, and if
not commenced within such time period, Buyer shall be deemed to have waived its
claims for such breach or default.
21. ERISA. Seller and Buyer hereby agree that, if the transactions
contemplated by this Agreement are non-exempt prohibited transactions under
Section 406 of ERISA, Seller shall not be obligated to sell the Property to
Buyer and Buyer shall not be obligated to purchase the Property from Seller.
22. Escrow Provisions.
(a) Investment of Deposit. Escrowee shall invest the Deposit
in such accounts, commercial paper, U.S. government securities, repurchase
agreements or other instruments as Purchaser shall from time-to-time direct and
Seller may approve. Escrowee shall promptly advise Seller and Buyer of the
investment of the Deposit. All interest earned on the Deposit shall be added to
and deemed part of the Deposit.
(b) Payment at Closing. If the Closing is completed under this
Agreement, Escrowee shall deliver the Deposit to Seller on the Closing Date.
(c) Other Payment. Notwithstanding anything contained in this
Agreement, upon receipt of any written notice from Seller or Buyer claiming the
Deposit pursuant to the provisions of this Agreement, Escrowee shall promptly
forward a copy thereof to the other party and, unless such other party within
ten (10) days thereafter notifies Escrowee of any objection to such request for
the disbursement of the Deposit, Escrowee shall disburse the Deposit to the
party demanding the same and Escrowee shall thereupon be released and discharged
from any further duty or obligation under this Agreement.
(d) Stakeholder. Escrowee is acting as a stakeholder only with
respect to the Deposit and Termination. If there is any dispute as to whether
Escrowee is obligated to deliver the Deposit or Termination, or as to whom the
Deposit or Termination is to be delivered, Escrowee may refuse to make any
delivery and may continue to hold the Deposit or Termination until receipt by
Escrowee of written authorization, signed by both Seller and Buyer, directing
the disposition of the Deposit or Termination or, in the absence of such joint
written authorization, until final determination of the rights of the parties in
appropriate judicial proceeding. Escrowee may also bring an appropriate action
or proceeding for leave to deposit the Deposit or Termination in a court of
competent jurisdiction located in Fairfax, Virginia and to interplead Seller and
Buyer. Upon making delivery of the Deposit of Termination, Escrowee shall have
no further liability with respect to the Deposit or Termination so delivered.
Seller and Buyer agree that the duties of Escrowee in its capacity as escrow
holder under this Agreement are ministerial in nature and that Escrowee shall
incur no liability except for its willful misconduct or gross negligence so long
as Escrowee acts in good faith.
16
(e) Tax Information. The federal tax identification
number of Buyer is 00-0000000. The federal tax identification
number of Seller is ___________________.
(f) Escrow Fees. Seller and Buyer shall each pay one-half of
the fees and expenses, if any, due to Escrowee as compensation for its escrow
services pursuant to this Agreement, and shall each reimburse Escrowee for
one-half of the expenses incurred by Escrowee in discharging its duties and
obligations as escrow holder under this Agreement.
23. Miscellaneous.
(a) Captions or Headings: Interpretation. The captions or
headings of the Paragraphs and subparagraphs of this Agreement are for
convenience only, and shall not control or affect the meaning or construction of
any of the terms or provisions of this Agreement. Wherever in this Agreement the
singular number is used, the same shall include the plural and vice versa and
the masculine gender shall include the feminine gender and vice versa as the
context shall require.
(b) Amendments and Waivers. No change, alteration, amendment,
modification or waiver of any of the terms or provisions of this Agreement shall
be valid, unless the same shall be in writing and signed by Buyer and Seller.
(c) No Rule of Construction. This Agreement has been
negotiated at arms length by both Seller and Buyer, and no rule of construction
shall be invoked against either party with respect to the authorship thereof or
of any of the documents to be delivered by the respective parties at the
Closing.
(d) Counterparts. This Contract may be executed in multiple
counterparts each of which shall be deemed an original but together shall
constitute one agreement.
(e) Applicable Law. This Agreement shall be governed
and construed according to the laws of the State in which the
Property is located.
(f) Right to Waive Conditions or Contingency. Either party may
waive any of the terms and conditions of this Agreement made for its benefit
provided such waiver is in writing and signed by the party waiving such term or
condition.
(g) Partial Invalidity. If any term, covenant,
condition or provision of this Agreement or the application thereof to any
person or circumstance shall be invalid or unenforceable, at any time or to any
extent, the remainder of this Agreement, or the application of such term or
provision to persons or circumstances other than those as to which it is held
invalid or unenforceable, shall not be affected thereby. Each term, covenant,
condition and provision of this Agreement shall be valid and enforced to the
fullest permitted by law.
17
(h) Public Disclosure of Agreement. Seller acknowledges that
Beacon Properties Corporation, the general partner of Buyer, is a publicly owned
corporation subject to regulation by the Securities and Exchange Commission
("SEC"), and that the regulations of the SEC may require that Buyer disclose the
existence of this Agreement and the contents of some or all of the documents and
materials delivered by Seller. Accordingly, Seller expressly consents to the
disclosure of the terms and conditions of this transaction, this Agreement
itself, and terms of any document or materials which Buyer in good faith
believes should be disclosed in connection with fulfillment of its disclosure
requirements under SEC regulations. In addition, following Closing, Buyer shall
have the right to issue press releases announcing this transaction. Seller shall
be entitled to a prior review and approval of the press release.
(i) Intentionally Omitted.
(j) Waiver of Tender of Deed and Purchase Monies. The tender
of an executed Deed by Seller and the tender by Buyer of the portion of the
Purchase Price payable at Closing are hereby mutually waived, but nothing herein
contained shall be construed as a waiver of Seller's obligation to deliver the
Deed and/or of the concurrent obligation of Buyer to pay the Purchase Price.
(k) Time of the Essence. Time, wherever specified herein for
the performance by Seller or buyer of any of their respective obligations
hereunder (including, without limitation the time deadline for delivery of an
Option Notice), is hereby made and declared to be of the essence of this
Agreement.
(l) Computation of Periods. If the final day of any period of
time in any provision of this Agreement falls upon a Saturday, Sunday or a
holiday observed by federally insured banks in the State in which the Property
is located or by the United States Postal Service, then, the time of such period
shall be extended to the next day which is not a Saturday, Sunday or holiday.
Unless otherwise specified, in computing any period of time described in this
Agreement, the day of the act or event after which the designated period of time
begins to run is not to be included and the last day of the period is so
computed is to be included, unless such last day is a Saturday, Sunday or
holiday in which event the period shall run until the end of the next day which
is neither a Saturday, Sunday or holiday.
(m) Exhibits and Schedules. All exhibits and schedules annexed
to this Agreement are incorporated by reference into and made a part of this
Agreement.
18
IN WITNESS WHEREOF, the parties, intending legally to be bound, have
executed this Agreement as of the date first above written.
SELLER:
CENTERPOINTE III LIMITED PARTNERSHIP
By: Pension Realty Holding Corporation,
General Partner
By: ______________________________________________
Name:
Title:
BUYER:
BEACON PROPERTIES, L.P.
By: Beacon Properties Corporation,
General Partner
By: _____________________________________________
Name:
Title:
19
