AGREEMENT OF PURCHASE AND SALE AND JOINT ESCROW INSTRUCTIONS
between
FAIRFAX CENTRE, LLC,
a California limited liability company
as Seller
and
ARDEN REALTY LIMITED PARTNERSHIP,
a Maryland limited partnership
as Buyer
TABLE OF CONTENTS
Page
1. DEFINITIONS 1
1.1 "Amendment to License Agreement and
Assignment, Assumption and Consent" 1
1.2 "Amresco" 1
1.3 "Appurtenances" 1
1.4 "Assignment, Assumption and Consent
Agreement" 2
1.5 "Assignment and Assumption of Leases" 2
1.6 "Assignment of Intangible Property and
Escrow Fund" 2
1.7 "Xxxx of Sale" 2
1.8 "Broker" 2
1.9 "Business Days" 2
1.10 "Closing" 2
1.11 "Closing Date" 2
1.12 "Code" 2
1.13 "Deed" 3
1.14 "Deposit" 3
1.15 Intentionally omitted 3
1.16 "Escrow Fund" 3
1.17 "Escrow Fund Balance" 3
1.18 "Escrow Holder" 3
1.19 "Fixtures" 3
1.20 "Governmental Regulations" 3
1.21 "Hazardous Materials" 3
1.22 "Intangible Property" 4
1.23 "Land" 4
1.24 "Leases" 4
1.25 "Lender" 4
1.26 "Lender's Legal Fees Xxxxxxxxxxxxx" 0
1.27 "License Agreement" 4
1.28 "Licenses and Permits" 4
1.29 "Loan" 4
1.30 "Loan Approval Date" 4
1.31 "Loan Assumption Fee" 5
1.32 "Loan Documents" 5
1.33 "Loan Servicing Fee" 5
1.34 "Notice To Tenants" 5
1.35 "Personal Property" 5
1.36 "Property" 5
1.37 "Purchase Price 5
1.38 "Real Property" 5
1.39 "Records and Plans" 5
1.40 "Replacement Escrow Fund" 5
1.41 "Rollover Escrow Fund" 5
1.42 "Schedule of Tenant Improvement
Allowances and Rent Credits" 6
1.43 "Service Contracts" 6
1.44 "Tax and Insurance Escrow Fund" 6
1.45 "Tenant Estoppels" 6
1.46 "Title Company" 6
1.47 "Title Policy" 6
1.48 "Transferor's Certificate" 6
1.49 "Warranties" 6
2. ESCROW; DEPOSIT 7
2.1 Escrow Instructions 7
2.2 Deposits 7
3. AGREEMENT TO SELL; PURCHASE PRICE 7
3.1 Deposits 7
3.2 Balance of Purchase Price; Escrow Fund
Balance 7
4. DELIVERIES AT CLOSING; CLOSING PROCEDURES 8
4.1 By Seller 8
4.2 By Buyer 9
4.3 By Buyer and Seller 9
4.4 Closing Procedures 9
5. REPRESENTATIONS AND WARRANTIES 11
5.1 Seller's Representations and Warranties. 11
5.2 Buyer's Representations and Warranties. 13
6. SELLER'S OBLIGATIONS 14
6.1 Further Liens and Encumbrances 14
6.2 Lease; Other Contracts; Interim
Activities 14
6.3 Property Management and Operation 14
6.4 Cooperation with Representatives 14
6.5 No Removal of Personal Property 15
6.6 Obtaining Estoppels and Consents 15
6.7 Assignment and Assumption of Loan 15
6.8 Service Contracts 15
6.9 Post-Closing Financial Records 15
6.10 Audit Rights 15
6.11 Management and Listing Agreements 16
8. CONDITIONS PRECEDENT/CONCURRENT TO CLOSING; CLOSING
DATE 16
8.1 Buyer's Conditions 16
8.1.1 Representations, Warranties
and Covenants of Seller 16
8.1.2 Seller's Deliveries 16
8.1.3 No Material Changes 16
8.1.4 Delivery of Pre-Closing
Documents and Agreements 16
8.1.5 Title Insurance 17
8.1.7 Loan Approval 17
8.1.8 CBS' Right to Purchase 17
8.2 Seller's Conditions 17
8.2.1 Representations and Warranties of Buyer 17
8.2.2 Buyer's Deliveries 17
9. Intentionally omitted 17
10. PRORATIONS 17
10.1 Current Rent 17
10.2 Rent Arrears 18
10.3 Tenant Improvement Allowances and Rent Credits 18
10.4 Security Deposits 18
10.5 Other Prorations 18
10.6 Preliminary Closing Adjustment 18
10.7 Post-Closing Reconciliation 18
10.8 Survival 18
11. COSTS AND EXPENSES 19
11.1 Seller 19
11.2 Buyer 19
11.3 Other Closing Costs 19
11.4 Delivery of Xxxxxxxxxx 00
00. CONDEMNATION AND DESTRUCTION 19
12.1 Eminent Domain or Taking 19
12.2 Damage or Destruction 20
13. REMEDIES 20
13.1 Buyer's Remedies 20
13.2 Seller's Remedies 22
14. 1031 EXCHANGE 22
15. BROKERAGE COMMISSIONS 23
16. NOTICES 23
17. ASSIGNMENT 24
17.1 Assignment by Buyer 24
17.2 Buyer Assignee's Rights and Obligations 24
18. MISCELLANEOUS 24
18.1 Survival 24
18.2 Parties in Interest 24
18.3 Section Headings 25
18.4 No Oral Modifications 25
18.5 Full Integration 25
18.6 Binding Effect 25
18.7 Seller's Advice of Counsel 25
18.8 Attorneys' Fees 25
18.9 Governing Law 25
18.10 Confidentiality 25
18.11 Captions 26
18.12 Severability 26
18.13 Time of the Essence 26
18.14 Non-Waiver 26
18.15 Facsimile 26
18.16 Further Assurances 26
18.17 Joint and Several Liability. 26
18.18 Counterparts 26
18.19 Seller's Indemnities 27
18.20 Reimbursement of Costs to Buyer 27
AGREEMENT OF PURCHASE AND SALE
AND JOINT ESCROW INSTRUCTIONS
THIS AGREEMENT OF PURCHASE AND SALE AND JOINT ESCROW
INSTRUCTIONS ("Agreement") dated as of the 29th day of August,
1997 is by and between Fairfax Centre, LLC, a California limited
liability company ("Seller"), and Arden Realty Limited
Partnership, a Maryland limited partnership ("Buyer").
Capitalized terms used in the Recitals below, not otherwise
defined therein, shall have the meanings ascribed to them in
Section 1 of this Agreement.
R E C I T A L S
WHEREAS, this Agreement is made and entered into with
reference to the following facts:
WHEREAS, Buyer desires to purchase, and Seller desires
to sell, the Property on the terms and conditions set forth in
this Agreement.
A G R E E M E N T
NOW, THEREFORE, in consideration of the foregoing
recitals, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Buyer
and Seller agree as follows:
1. DEFINITIONS. For purposes of this Agreement, the
following terms shall have the following meanings:
1.1 "Amendment to License Agreement and
Assignment, Assumption and Consent" means the Amendment to
License Agreement and Assignment, Assumption and Consent in the
form of, and upon the terms and conditions contained in Exhibit
"N".
1.2 "Amresco" means Amresco Services L.P.
1.3 "Appurtenances" means all rights, privileges
and easements appurtenant to the Land, including, without
limitation, all minerals, oil, gas and other hydrocarbon sub
stances in, on and under the Land, as well as all development
rights, air rights, water, water rights and water stock relating
to the Land and any other easements appurtenant to the Land.
1.4 "Assignment, Assumption and Consent
Agreement" means a written assignment, assumption and consent
agreement made by Lender, Seller and Buyer, and a beneficiary
statement made by Lender, both in form and content acceptable to
Buyer in its sole and nonreviewable discretion, wherein Lender
consents to the assignment to and assumption of the Loan by
Buyer, and represents to Buyer that Seller is not in default
under any of the terms or provisions of the Loan Documents beyond
the expiration of any notice and cure period provided for
therein.
1.5 "Assignment and Assumption of Leases" means
the Assignment and Assumption of Leases, to be duly executed and
delivered by Seller and Buyer in accordance with Section 4.1 of
this Agreement, assigning to Buyer all of Seller's right, title
and interest in and to the Leases. The Assignment and Assumption
of Leases shall be in the form of, and upon the terms contained
in, Exhibit "C".
1.6 "Assignment of Intangible Property and Escrow
Fund" means the Assignment of Intangible Property and Escrow
Fund, to be duly executed and delivered by Seller in accordance
with Sections 4.1 and 4.2 of this Agreement, assigning to Buyer
all of Seller's right, title and interest, if any, in and to the
Intangible Property and Escrow Fund. The Assignment of
Intangible Property and Escrow Fund shall be in the form of, and
upon the terms contained in, Exhibit "B".
1.7 "Xxxx of Sale" means the Xxxx of Sale, to be
duly executed and delivered by Seller in accordance with
Section 4.1 of this Agreement, conveying to Buyer all of the
Personal Property. The Xxxx of Sale shall be in the form of, and
upon the terms contained in, Exhibit "D".
1.8 "Broker" means First Property Realty
Corporation.
1.9 "Business Days" means all days except
Saturdays, Sundays and holidays in which a majority of the banks
in the City of Los Angeles are closed for business.
1.10 "Closing" means the consummation of the
conveyances of the Property, the Leases and the other
transactions contemplated under this Agreement, all of which
shall occur on or before the Closing Date.
1.11 "Closing Date" means the date which is five
(5) Business Days after the Loan Approval Date, unless otherwise
mutually agreed to in writing by Buyer and Seller or extended
pursuant to the terms of this Agreement.
1.12 "Code" means the United States Internal
Revenue Code of 1986, as amended.
1.13 "Deed" means the Grant Deed, to be duly
executed, acknowledged and delivered in recordable form by Seller
in accordance with Section 4.1 of this Agreement, conveying to
Buyer good and marketable fee simple title to the Real Property.
The Deed shall be in the form of, and upon the terms contained
in, Exhibit "E".
1.14 "Deposit" means the sum of One Hundred
Thousand Dollars ($100,000.00) to be delivered to Escrow Holder
within one (1) Business Day after the mutual execution of this
Agreement by Buyer and Seller and delivery of the same to Escrow
Holder in accordance with Section 3.1 of this Agreement.
1.15 Intentionally omitted.
1.16 "Escrow Fund" shall collectively mean
the Rollover Escrow Fund, Replacement Escrow Fund and Tax and
Insurance Escrow Fund.
1.17 "Escrow Fund Balance" means the cash
balance on hand in the Rollover Escrow Fund, Replacement Escrow
Fund and Tax and Insurance Escrow Fund as of the Closing Date.
1.18 "Escrow Holder" means Commerce Escrow
Company, 0000 Xxxxxxxx Xxxxxxxxx, Xxxxx 000, Xxx Xxxxxxx,
Xxxxxxxxxx 00000, Attention: Xxxx Xxxxxx.
1.19 "Fixtures" means all fixtures placed on,
attached to, or located at and used in connection with the
operation of, the Land and which are owned by Seller.
1.20 "Governmental Regulations" means any local,
state, and federal laws, ordinances, rules, requirements,
resolutions, policy statements and regulations (including, with
out limitation, those relating to land use, subdivision, zoning,
environmental, labor relations, notification of sale to employer,
Hazardous Materials, occupational health and safety, water,
earthquake hazard reduction and building and fire codes) bearing
on the construction, development, alteration, rehabilitation,
maintenance, use, operation, or sale of the Property.
1.21 "Hazardous Materials" means any hazardous or
toxic substance, material or waste which is or becomes regulated
by any local governmental authority, any agency of the State of
California or any agency of the United States Government. The
term "Hazardous Materials" includes, without limitation, any
material or substance which (a) contains petroleum or any
petroleum by-products, (b) contains asbestos, (c) contains urea
formaldehyde foam insulation, (d) is designated as a "hazardous
substance" pursuant to Section 311 of the Federal Water Pollution
Control Act (33 U.S.C. ' 1317), (e) is defined as a "hazardous
waste" pursuant to Section 1004 of the Federal Resource
Conservation and Recovery Act, 42 U.S.C. ' 6901 (42 U.S.C.
' 6903), or (f) is defined as a "hazardous substance" pursuant to
Section 101 of the Comprehensive Environmental Response,
Compensation and Liability Act, 42 U.S.C. ' 9601 (42 U.S.C.
' 9601). Each reference to a statute or law in this definition
shall be deemed to include any amendments thereto which are
enacted from time to time.
1.22 "Intangible Property" means all of Seller's
right, title and interest in and to any and all intangible
personal property now and through the Closing Date owned by
Seller and used in connection with the ownership, construction,
development, use and/or operation of the Real Property and/or
Personal Property, including, without limitation, all tradenames
of the Real Property, any and all claims and causes of action,
the Service Contracts (to the extent approved in writing by
Buyer), the Licenses and Permits, the Intellectual Property and
the Records and Plans and the Warranties.
1.23 "Land" means the real property located at 000
Xxxxx Xxxxxxx Xxxxxx, Xxx Xxxxxxx, Xxxxxxxxxx, as legally
described in Exhibit "A".
1.24 "Leases" means the existing leases relating
to the Real Property, which Leases are listed on Exhibit "F".
1.25 "Lender" means Nomura Asset Capital
Corporation, a Delaware corporation, or its successor in
interest.
1.26 "Lender's Legal Fees Reimbursement"
means the sum of up to Four Thousand Two Hundred and no/100
Dollars ($4,200.00) payable by Buyer to reimburse Lender for its
legal fees and costs associated with the assignment and
assumption of the Loan, and which shall be delivered to Amresco
(made payable to the law firm of Xxxxxx & Bird), through Escrow
Holder, subject to the terms and conditions provided herein.
1.27 "License Agreement" means that certain
Parking License Agreement made as of November 6, 1996 by and
between Xxxxxx Xxxxxxxxxx and Indoprop, Inc., as licensor, and
Barnaby's Hollywood LLC, as licensee.
1.28 "Licenses and Permits" means all of Seller's
right, title, interests, privileges, benefits and remedies in, to
and under all authorizations, approvals, permits, certificates of
occupancy, licenses, agreements, variances, tentative maps, final
maps, plans and specifications and land use entitlements held by
Seller and/or relating to the construction, reconstruction,
occupancy, operation or use of any part of the Real Property or
Personal Property (e.g., all building permits and certificates
and occupancy).
1.29 "Loan" means that certain loan made by
Lender to Seller in the original principal amount of
$4,125,000.00.
1.30 "Loan Approval Date" means the date on
which Lender shall have unconditionally consented to the
assignment and assumption of the Loan to Buyer and shall have
executed and delivered to Escrow Holder the Assignment,
Assumption and Consent Agreement.
1.31 "Loan Assumption Fee" means the sum of
Forty One Thousand One Hundred Twenty and no/100 Dollars
($41,120.00) to be paid to Lender, through Escrow Holder, subject
to the terms and conditions provided herein.
1.32 "Loan Documents" shall mean all loan
documents executed by Seller in connection with the Loan, or
otherwise evidencing or relating to the Loan, a complete schedule
of which is listed on Exhibit "O".
1.33 "Loan Servicing Fee" means the sum of
Three Thousand and no/100 Dollars ($3,000.00) to be paid to
Amresco, through Escrow Holder, subject to the terms and
conditions provided herein.
1.34 "Notice To Tenants" means the notice from
Seller to the tenants under the Leases whereby such tenants are
notified that the Property has been transferred by Seller to
Buyer and instructing the tenants to pay any and all rents and
other sums payable under the Leases from and after the Closing
directly to Buyer or as otherwise directed by Buyer, in the form
of Exhibit "G".
1.35 "Personal Property" means all personal
property of Seller located on or in or used in connection with
the Real Property.
1.36 "Property" means the Real Property, the
Personal Property and the Intangible Property.
1.37 "Purchase Price" means the sum of Seven
Million Three Hundred Thousand and no/100 Dollars
($7,300,000.00).
1.38 "Real Property" means the Land, the
improvements situated on the Land, the Fixtures and the Appurten
ances.
1.39 "Records and Plans" means (a) all books and
records maintained in connection with the ownership, development,
construction, maintenance or operation of the Property, (b) all
preliminary, final and "as-built" plans and specifications
respecting the Real Property, and (c) all structural reviews,
architectural drawings, and engineering, soil, seismic, geologic
and architectural reports, studies and certificates and other
documents pertaining to the Real Property (including those which
include comments by any building or safety engineer, inspector or
other person who regularly makes such inspections) which are
within the possession of, under the control of, or reasonably
available to (without cost or expense) Seller.
1.40 "Replacement Escrow Fund" shall have the
meaning ascribed to such term in the Deed of Trust.
1.41 "Rollover Escrow Fund" shall have the
meaning ascribed to such term in that certain Deed of Trust,
Assignment of Leases and Rents and Security Agreement dated as of
December 19, 1996 between Lender, as beneficiary, and Seller, as
trustor (the "Deed of Trust").
1.42 "Schedule of Tenant Improvement
Allowances and Rent Credits" means the schedule of unpaid tenant
improvement allowances and rent credits under Leases entered into
prior to the date of this Agreement, which Schedule is attached
hereto as Exhibit "L".
1.43 "Service Contracts" means any and all
management agreements, service contracts, art contracts,
landscaping contracts, equipment leases, maintenance agreements
and all other contracts for the provision of labor, services,
materials or supplies to or for the benefit of the Real Property,
together with all supplements, amendments and modifications
thereto, which are set forth on Exhibit "H" attached to this
Agreement.
1.44 "Tax and Insurance Escrow Fund" shall
have the meaning ascribed to such term in the Deed of Trust.
1.45 "Tenant Estoppels" means the written
statements in the form of, and upon the terms contained in,
Exhibit "I", in favor of Buyer from the tenants which are parties
to the Leases, dated not earlier than thirty (30) days prior to
the Closing Date.
1.46 "Title Company" means Commonwealth Land Title
Insurance Company, 000 Xxxxx Xxxxx Xxxxxxxxx, 00xx Xxxxx,
Xxxxxxxx, Xxxxxxxxxx 00000.
1.47 "Title Policy" means an ALTA owner's title
policy (Form B-1970) issued by the Title Company for the benefit
of Buyer, which Title Policy shall have a liability limit in the
amount of the Purchase Price, shall include those endorsements
reasonably requested by Buyer and shall show only those matters
which constitute Permitted Exceptions (defined below).
1.48 "Transferor's Certificate" means the
certificate, to be duly executed by Seller under penalty of
perjury and delivered by Seller in accordance with Section 4.1 of
this Agreement, certifying that Seller is not a "foreign person"
in accordance with the provisions of Section 1445 of the Code and
any similar provisions of applicable state law. The Transferor's
Certificate shall be in the form of, and upon the terms contained
in, Exhibit "J".
1.49 "Warranties" means all third party warranties
and guarantees, if any, relating to the Property which are set
forth on Exhibit "M".
2. ESCROW; DEPOSIT.
2.1 Escrow Instructions. The purchase and sale
of the Property shall be consummated through an escrow at Escrow
Holder. As soon as reasonably practicable following the mutual
execution of this Agreement, but in no event later than three (3)
days after the date of this Agreement, the parties shall deliver
to Escrow Holder a fully executed counterpart of this Agreement,
which shall constitute its escrow instructions. The parties
shall execute such additional escrow instructions, not
inconsistent with this Agreement, as Escrow Holder shall deem
reasonably necessary for its protection. In the event of any
conflict between this Agreement and any additional escrow
instructions, the terms of this Agreement shall govern.
2.2 Deposits. Within one (1) Business Day after
the execution of this Agreement by Buyer and Seller and delivery
of the same to Escrow Holder, Buyer shall deliver the Lender's
Legal Fees Reimbursement and the Loan Servicing Fee to Escrow
Holder to hold in trust. Escrow Holder shall deliver the Loan
Servicing Fee and Lender's Legal Fees Reimbursement to Amresco in
immediately available funds. Notwithstanding the foregoing, if
Lender's actual, documented legal fees and costs expended in good
faith in connection with the proposed assumption of the Loan are
less than $4,200, then Buyer shall receive a credit at Closing
against the Purchase Price for the difference between $4,200 and
Lender's actual, documented legal fees and costs.
3. AGREEMENT TO SELL; PURCHASE PRICE. Seller agrees
to sell to Buyer, and Buyer agrees to purchase from Seller, the
Property in accordance with the terms, and subject to the
conditions, of this Agreement. The Purchase Price for the
Property will be paid as follows:
3.1 Deposits. Within one (1) Business Day after
the execution of this Agreement by Buyer and Seller and delivery
of the same to Escrow Holder, in addition to the sums deposited
pursuant to Section 2.2 above, Buyer will deliver the Deposit and
$23,560 of the Loan Assumption Fee ("Loan Assumption Fee
Deposit"), to Escrow Holder to hold in trust. Escrow Holder
shall promptly deliver the Loan Assumption Fee Deposit to
Amresco. Escrow Holder will invest the Deposit in an interest
bearing account with a responsible federally-insured
institutional lender approved by Buyer and Seller, and interest
will be for the account of Buyer except as otherwise provided in
this Agreement and will be credited against the Purchase Price at
Closing. In the event any of the conditions set forth in
Section 8.1 are not satisfied, (i) the Deposit shall be fully
refundable to Buyer, and (ii) the Loan Assumption Fee Deposit
shall be paid directly from Seller to Buyer. Except as set forth
in Section 13.2 below, the Loan Assumption Fee, or any such
portion thereof deposited by Buyer with Escrow Holder, shall be
fully refundable to Buyer unless and until the Closing occurs as
provided herein.
3.2 Balance of Purchase Price; Escrow Fund
Balance. The entire balance of the Purchase Price, the balance
of the Loan Assumption Fee and an amount equal to the Escrow Fund
Balance (after taking into account the adjustments described in
Sections 10 and 11), shall be paid to Seller, with immediately
available funds, through Escrow Holder, at Closing.
4. DELIVERIES AT CLOSING; CLOSING PROCEDURES. The
Closing will take place on the Closing Date.
4.1 By Seller. At least one (1) Business Day
prior to the Closing, Seller shall deliver or cause to be
delivered to Escrow Holder (unless otherwise indicated) the
following items, duly executed and, where appropriate,
acknowledged by Seller:
4.1.1 The Deed.
4.1.2 The Xxxx of Sale.
4.1.3 Three (3) counterparts of the
Assignment, Assumption and Consent Agreement.
4.1.4 Two (2) counterparts of the Assignment
of Intangible Property and Escrow Fund.
4.1.5 Two (2) counterparts of the Assignment
and Assumption of Leases.
4.1.6 The Notices to Tenants.
4.1.7 The Transferor's Certificate.
4.1.8 The Tenant Estoppels (to be delivered
directly to Buyer).
4.1.9 An original of the License Agreement
(if available) and two (2) counterpart originals of the Amendment
to License Agreement and Assignment, Assumption and Consent.
4.1.10 Evidence reasonably satisfactory
to Buyer of the termination of any property management agreement
and brokerage listing agreement for the Property as provided in
Section 6.11 hereof.
4.1.11 All such further confirmations,
satisfactions, releases, approvals, consents and any and all such
further instruments as may be reasonably necessary, appropriate,
expedient or proper in the reasonable opinion of Title Company in
order to issue the Title Policy.
4.2 By Buyer. At the Closing, Buyer will deliver
or cause to be delivered to Escrow Holder or the Seller the
following items, duly executed and, where appropriate,
acknowledged by Buyer:
4.2.1 The net balance of the Purchase Price,
to be paid in accordance with Sections 3.2 of this Agreement,
after deducting both the Deposit plus any interest accrued
thereon, and after taking into account the adjustments and cost
allocations in accordance with Sections 10 and 11.
4.2.2 Good funds in an amount equal to
the Escrow Fund Balance but after taking into account the
adjustments in accordance with Section 10.
4.2.3 Two (2) counterparts of the
Assignment of Intangible Property and Escrow Fund and the
Assignment and Assumption of Leases and three (3) counterparts of
the Assignment, Assumption and Consent Agreement.
4.2.4 Two (2) counterpart originals of the
Amendment to License Agreement and Assignment, Assumption and
Consent.
4.2.5 The balance of the Loan
Assumption Fee.
4.3 By Buyer and Seller. Buyer and Seller will
each deposit such other instruments consistent with this Agree
ment as are reasonably required to effectuate the transactions
contemplated under this Agreement.
4.4 Closing Procedures. Provided that Escrow
Holder has received the documents and funds described in Sections
4.1 and 4.2 above and has not received notice from any party
hereto either that an agreement of another party hereunder has
not been performed, that a condition set forth herein has not
been satisfied or waived or that this Agreement has terminated
(by its terms or by an election duly made hereunder), and further
provided that the issuance of, or an unconditional commitment to
issue, the Title Policy has been obtained, Escrow Holder is
authorized and instructed at 8:00 a.m. on the Closing Date to:
4.4.1 Record the Deed and the Assignment,
Assumption and Consent Agreement with the County Recorder of Los
Angeles County, California.
4.4.2 Cause the Title Policy to be
issued by the Title Company to Buyer.
4.4.3 Deliver to Buyer: the Assignment,
Assumption and Consent Agreement, the Assignment and Assumption
of Leases, the Assignment of Intangible Property and Escrow Fund,
the Xxxx of Sale, the Amendment to License Agreement and
Assignment, Assumption and Consent, the Transferor's Certificate,
all documents and items required to be delivered by Seller
pursuant to Sections 4.1 and 8.1.4 or any other provision of this
Agreement, not otherwise previously delivered directly to Buyer,
all other items deposited by Seller with Escrow Holder pertaining
to the Property, and any funds deposited by Buyer in excess of
the amount to be paid by Buyer under the terms of this Agreement.
4.4.4 Deliver to Seller: the Purchase Price
and Escrow Fund Balance, after taking into account the
adjustments and cost allocations in accordance with Sections
4.4.7, 10 and 11, and the Assignment, Assumption and Consent
Agreement, the Assignment and Assumption of Leases, the
Assignment of Intangible Property and Escrow Fund, the Amendment
to License Agreement and Assignment, Assumption and Consent, and
any other document deposited by Buyer with Escrow Holder for
delivery to Seller at the Closing.
4.4.5 Deliver to Lender: the Loan
Assumption Fee and the original of the Assignment, Assumption and
Consent Agreement.
4.4.6 Notices to Tenants. Mail the Notices
to Tenants to the tenants under the Leases by certified mail,
return receipt requested.
4.4.7 Holdback Account. Maintain an
amount equal to $50,000 in escrow, from which $1,000 shall be
disbursed (pursuant to instructions to be given to Escrow Holder
by Buyer) to Buyer on the first day of each month following the
Start Date (defined below). On the first day of each month
during the period commencing on the Closing Date and ending on
the day immediately preceding the Start Date, $1,000 shall be
disbursed by Escrow Holder to Seller. Such disbursements shall
be made without further instructions from either party hereunder,
unless Buyer has notified Escrow Holder in writing that the
License Agreement, as amended, has been mutually terminated and
is of no further force and effect. Such disbursements shall
cease to be made upon the earlier of the date no funds remain in
such holdback account or the term of the License Agreement has
expired. In the event the License Agreement has been mutually
terminated or its term has expired, any funds remaining in the
escrow account shall be disbursed to Seller (except to the extent
of any unpaid amounts due thereunder to licensor, which shall be
paid to licensor). The term "Start Date" shall mean the date set
forth in a written notice from the licensee to the licensor under
the License Agreement upon which licensee intends to commence its
use of the Spaces (as defined in the License Agreement) in
accordance with the terms thereof (provided that such written
notice must be received by the licensor no less than 15 days
prior to the commencement date set forth in such notice).
Notwithstanding anything to the contrary, for the period
following the date licensee notifies licensor in writing it no
longer intends to use any of the Spaces (and no use is actually
made of the Spaces) until the date which is 15 days following the
date that the Licensee's Successor-In-Interest (as defined
herein) notifies the licensor in writing that it intends to re-
commence the use of the Spaces, $1,000 shall be disbursed to
Seller on the 1st day of each month. For purposes of this
Agreement, the term "Licensee's Successor-In-Interest" shall mean
licensee's lenders and any entity which acquires licensee's
business. Licensee (as opposed to any Licensee's Successor-in-
Interest) shall in no event have the right to re-commence the use
of the Spaces following its delivery to licensor of a notice
cancelling its use of the Spaces. Licensee shall notify
Licensee's Successor-in-Interest that Licensee's Successor-in-
Interest shall have no right to use any of the Spaces in
accordance with the terms of the License Agreement until it has
delivered to licensor at least 15 days prior written notice of
its intention to use the Spaces.
5. REPRESENTATIONS AND WARRANTIES.
5.1 Seller's Representations and Warranties.
Seller makes the following representations and warranties to
Buyer, upon which warranties and representations Buyer has relied
and will continue to rely, all of which are true as of the date
of this Agreement and will be true and correct as of the Closing:
5.1.1 Seller is duly organized, validly
existing and in good standing under the laws of the State of
California. The execution, delivery and performance of this
Agreement and the other documents contemplated by this Agreement
by Seller, and the performance by Seller of the obligations under
this Agreement and the other documents contemplated in this
Agreement (i) are within the power of Seller; (ii) have been duly
authorized by all requisite company action; and (iii) will not
violate any provision of law, any order of any court or agency of
government, the opening agreement or other organizational
documents of Seller or its members, or any indenture, agreement
or any other instrument to which Seller is a party. This
Agreement and each of the other documents described in this
Agreement when executed and delivered to Buyer, will constitute
legal, valid and binding obligations enforceable against Seller
in accordance with the terms of such documents.
5.1.2 Seller has full legal power and
authority to enter into and perform this Agreement in accordance
with its terms. Subject to obtaining the Lender's consent to the
assumption of the Loan by Buyer, the execution, delivery and
performance of this Agreement and all documents in connection
therewith are not in contravention of or in conflict with any
deed of trust, agreement or undertaking to which Seller is a
party or by which Seller or any of its property, including the
Property, may be bound or affected following the Closing. The
execution and delivery of this Agreement and the performance by
Seller of its obligations hereunder require no further action or
approval in order to constitute this Agreement as a binding and
enforceable obligation of Seller, and all such actions have been
duly taken by Seller;
5.1.3 Seller is the owner of the
Personal Property and has good title thereto, free and clear of
all liens, claims and security interests whatsoever except for
any lien thereon in favor of Lender.
5.1.4 Except as previously disclosed to
Buyer or to the extent of Buyer's actual knowledge, Seller has no
actual knowledge of any:
a. Governmental notification from any
governmental authority notifying Seller of any (a) violation of
any city, County, State, Federal, building, zoning, fire, health
code, regulation, ordinance or covenant, filed or issued against
the Property; or (b) impending or threatened special assessments
on the Property;
b. Existing, proposed or contemplated plan
to modify or realign any existing street or highway or any
existing, proposed or contemplated eminent domain proceeding that
would result in the taking of all or any part of the Property;
c. Litigation or legal proceeding pending
or threatened in writing against Seller or the Property that
could reasonably be expected to materially and adversely affect
Seller's or Buyer's ability to perform their respective
obligations hereunder, or Buyer's use of the Property for its
existing purposes;
d. Except as set forth on Exhibit "P"
attached hereto, storage or disposal on the Property of any
material amounts of toxic or hazardous waste, material or
substance, and Seller has received no notice from any
governmental authority requiring the removal of any toxic or
hazardous waste, material or substance from the Property.
e. Leases, Service Contracts, Warranties
or Loan Documents other than those disclosed on Exhibits "F",
"H", "M" and "O" attached hereto.
5.1.5 Except in connection with leases
entered into with Bet Tzedek and Xxx & Associates, there are no
unpaid tenant improvement allowances or rent credits under any
leases or lease amendments entered into prior to the date of this
Agreement. The unpaid tenant improvement allowances and/or rent
credits under the Bet Tzedek and Xxx & Associates leases are set
forth in the Schedule of Tenant Improvement Allowances and Rent
Credits. Seller agrees to update the Schedule of Tenant
Improvement Allowances and Rent Credits as of the Closing. There
are no brokerage commissions payable in connection with any
leases or lease amendments entered into prior to the date of this
Agreement.
5.1.6 "AS-IS" Sale. Except as set
forth in this Agreement and the conveyance documents, Buyer
acknowledges that Seller makes no representation or warranty,
either express, implied or statutory, with respect to the
Property, its present condition or its fitness or suitability for
any particular purpose or the Records and Plans. In this
respect, Buyer confirms that Buyer is an experienced real estate
purchaser and investor who is familiar with the acquisition and
ownership of real property of the same type as the Property and
that Buyer is acquiring the Property "AS IS, WHERE IS," in its
present state and condition and is "WITH ALL FAULTS" and subject
only to Seller's representations and warranties contained herein.
Subject only to Seller's representations and warranties contained
herein, Buyer is relying solely upon its investigation of the
present condition of the Property and all governmental laws and
ordinances which might affect use and development of the
Property. The agreements expressed in this Section 5.1.6 shall
survive the Closing Date.
5.1.7 Disclaimer. EXCEPT AS EXPRESSLY
SET FORTH IN THIS AGREEMENT AND SUBJECT ONLY TO SELLER'S
REPRESENTATIONS AND WARRANTIES CONTAINED IN THIS SECTION 5.1
SELLER MAKES NO REPRESENTATIONS OR WARRANTIES WHATSOEVER, EITHER
EXPRESS OR IMPLIED OR STATUTORY, RELATING TO THE PROPERTY OR ANY
PORTION THEREOF OR THE CONDITION OF THE PROPERTY OR RELATING TO
THE TITLE DOCUMENTS, THE PROPERTY MATERIALS OR ANY OTHER MATTER,
ALL SUCH REPRESENTATIONS AND WARRANTIES BEING HEREBY EXPRESSLY
DISCLAIMED. WITHOUT LIMITING THE GENERALITY OF THE FOREGOING,
AND EXCEPT AS SET FORTH IN THIS AGREEMENT SELLER MAKES NO
REPRESENTATIONS OR WARRANTIES WITH RESPECT TO: (a) environmental
matters relating to the Property or any portion thereof;
(b) geological or seismic conditions, including, without
limitation, subsidence, subsurface conditions, water table,
underground water reservoirs, and limitations regarding the
withdrawal of water therefrom, and faulting; (c) whether or not
and the extent to which the Property or any portion thereof is
affected by any stream (surface or underground), body of water,
flood prone area, flood plain, floodway, or special flood hazard;
(d) drainage; (e) soil conditions; (f) zoning to which the
Property or any portion thereof may be subject; (g) the
availability of any utilities to the Property or any portion
thereof including, without limitation, water, sewage, gas and
electric; (h) usages of adjoining property; (i) access to the
Property or any portion thereof; (j) the value, compliance with
specifications, size, location, age, use, merchantability,
design, quality, description, durability, operation or condition
of the Property or any portion thereof, or suitability of the
Property or any portion thereof for Buyer's purposes, or fitness
for any use or purpose whatsoever.
5.2 Buyer's Representations and Warranties.
Buyer makes the following representation and warranty to Seller
upon which warranty and representation Seller has relied and will
continue to rely, and which is true as of the date of this
Agreement and will be true and correct as of the Closing:
5.2.1 Buyer is duly organized, validly
existing and in good standing under the laws of the State of
Maryland and is duly qualified to do business in the State of
California. The execution and delivery of this Agreement and the
other documents contemplated this Agreement by Buyer, and the
performance by Buyer of the obligations under this Agreement and
the other documents contemplated in this Agreement (i) are within
the power of Buyer; (ii) have been duly authorized by all
requisite partnership action and corporate action on the part of
all of its constituent corporate partners; and (iii) will not
violate any provision of law, any order of any court or agency of
government, the charter documents of Buyer or its general
partners, or any indenture, agreement or any other instrument to
which Buyer is a party. This Agreement and each of the other
documents described in this Agreement when executed and delivered
to Buyer, will constitute legal, valid and binding obligations
enforceable against Buyer in accordance with the terms of such
documents.
5.2.2 Buyer has full legal power and
authority to enter into and perform this Agreement in accordance
with its terms. The execution, delivery and performance of this
Agreement and all documents in connection therewith are not in
contravention of or in conflict with any deed of trust, agreement
or undertaking to which Buyer is a party or by which Buyer or any
of its property, including the Property, may be bound or affected
following the Closing. The execution and delivery of this
Agreement and the performance by Buyer of its obligations
hereunder require no further action or approval in order to
constitute this Agreement as a binding and enforceable obligation
of Buyer, and all such actions have been duly taken by Buyer.
6. SELLER'S OBLIGATIONS. Seller hereby covenants to
Buyer, upon which covenants Buyer has relied and will continue to
rely, that for the period from the date of this Agreement through
and including the Closing Date:
6.1 Further Liens and Encumbrances. Seller will
not subject the Property to any additional liens, encumbrances,
covenants, conditions, easements, rights of way or similar
matters after the date of this Agreement. Seller will not
hereafter modify, extend, renew, replace or otherwise change any
of the terms, covenants or conditions of any of such documents,
or enter into any new agreements affecting the Property without
the prior written consent of Buyer, which consent may be withheld
in Buyer's sole and absolute discretion.
6.2 Lease; Other Contracts; Interim Activities.
Except as otherwise provided herein, Seller will not hereafter
terminate, modify, extend, renew, replace or otherwise change any
of the Leases or existing contracts or enter into new leases or
contracts affecting the Property except with the prior written
consent of Buyer, which consent may be withheld in Buyer's sole
and absolute discretion. Seller shall not apply for or otherwise
deal with any governmental authority regarding the development,
entitlement or subdivision of the Real Property without the prior
written consent of Buyer, which may be withheld in Buyer's sole
and absolute discretion.
6.3 Property Management and Operation. Seller
shall maintain the operation of the Property in a good and
business-like manner. Seller shall provide all services and
operate, manage and maintain the Property (including mechanical
equipment of every kind used in the operation thereof) in such a
manner that the Property shall be in the same condition on the
Closing Date as on the date of this Agreement, ordinary wear and
tear excepted. Without limiting the foregoing, Seller shall
perform all of its obligations under the Leases and the Service
Contracts.
6.4 Cooperation with Representatives. Seller
shall cooperate with Buyer and its accountants, counsel and/or
other representatives in providing information and materials
pertaining to the operation and marketing of the Property,
including access to the Property. Without limiting the
generality of the foregoing, from and after the execution and
delivery of this Agreement, Seller shall allow a representative
or representatives of Buyer access to the Property for the
purpose of (a) monitoring the operation of the Property,
(b) meeting with and interviewing tenants of the Property, which
tenants shall be made available for such interviewing process,
and (c) performing such investigations and analyses of the
Property as Buyer may reasonably require.
6.5 No Removal of Personal Property. Seller will
not remove any of the Personal Property unless the Personal
Property so removed is simultaneously replaced with substantially
similar Personal Property of similar quality or utilities.
6.6 Obtaining Estoppels and Consents. Seller
shall use its best efforts to obtain all written consents from
third parties, including Lender, required or reasonably requested
by Buyer or its accountants, counsel or other representatives in
connection with this Agreement, including, without limitation,
the Tenant Estoppels. Seller hereby acknowledges and agrees that
the obtaining of the Tenant Estoppels from tenants occupying not
less than an aggregate of eighty-five percent (85%) of the gross
leasable area of the Real Property, is a condition precedent to
Buyer's obligations under this Agreement.
6.7 Assignment and Assumption of Loan. Seller
shall use its best efforts to obtain Lender's consent to the
assignment and assumption of the Loan by Buyer, upon the terms
and conditions provided herein. Buyer agrees to reasonably
cooperate, at no additional cost to Buyer beyond that set forth
in this Agreement, with any requests for information made by
Lender in connection with its review of the requested assumption
of the Loan by Buyer.
6.8 Service Contracts. Seller shall deliver
notices of termination to any vendors under the Service Contracts
which have been designated in writing by Buyer to be terminated
("Disapproved Service Contract List"). Seller shall, within two
(2) days following Buyer's delivery of the Disapproved Service
Contract List, deliver termination notices to each of the vendors
with respect to the Service Contracts so designated by Buyer in
the Disapproved Service Contract List. Seller shall be solely
responsible for all costs and expenses associated with the
termination of any of the Service Contracts set forth by Buyer in
the Disapproved Service Contract List, and shall indemnify,
defend, and hold Buyer harmless from and against Seller.
6.9 Post-Closing Financial Records. As soon as
reasonably practicable following the Closing Date, Seller shall
deliver to Buyer the following: (a) a final income statement
through the Closing Date, (b) a final cumulative general ledger
through the Closing Date, and (c) a final aged delinquency
listing, including all security deposits received by Seller.
6.10 Audit Rights. At Buyer's request at
any time from and after the date hereof until the date that is
one (1) year after the Closing Date, Seller shall, at Buyer's
expense, provide to Buyer's designated independent auditor access
to the books and records of the Property, regarding the period
for which Buyer is required to have audited financial statements
prepared with respect to the Property as may be required by the
Securities and Exchange Commission, to the extent that such
books, records and related information are in Seller's possession
or control and relate to the period during which Seller held
title to the Property. Further, Seller agrees to provide to such
auditor a representation letter regarding the books and records
of the Property, in substantially the form of Exhibit "K"
attached hereto, in connection with the normal course of auditing
the Property in accordance with generally accepted auditing
standards.
6.11 Management and Listing Agreements.
Seller agrees to terminate, at Seller's sole cost and expense,
any property management agreement and brokerage leasing
agreement effective as of the Closing Date. Seller shall be
solely responsible for all costs and expenses associated with the
termination of any property management agreement and brokerage
leasing agreement, and shall indemnify, defend and hold Buyer
harmless from and against same.
70 Intentionally Omitted.
80 CONDITIONS PRECEDENT/CONCURRENT TO CLOSING;
CLOSING DATE.
8.1 Buyer's Conditions. Buyer shall not be
required to close the transaction provided for under this
Agreement, unless and until Buyer deems that each and every one
of the following conditions has been fulfilled:
8.1.1 Representations, Warranties and
Covenants of Seller. Seller shall have duly and timely performed
each and every covenant to be performed by Seller under this
Agreement and the representations and warranties set forth in
this Agreement shall be true and correct as of the Closing in all
respects.
8.1.2 Seller's Deliveries. Seller shall have
duly and timely delivered to Escrow Holder or Buyer, as
applicable, all of the items described in Section 4.1 of this
Agreement, except that with respect to the Tenant Estoppels,
Seller shall have delivered to Buyer Tenant Estoppels from
tenants occupying not less than an aggregate of eighty-five
percent (85%) of the gross leasable area of the Real Property.
8.1.3 No Material Changes. At the Closing,
there will be no material adverse changes in the physical or
financial condition of or title to the Property which were
discovered by Buyer after the date of this Agreement.
8.1.4 Delivery of Pre-Closing Documents and
Agreements. Seller shall have delivered to Buyer on or before
the Closing Date the following (to the extent in Seller's
possession, control or otherwise reasonably available [at no cost
or expense] to Seller):
8.1.4.1 Originals of all Leases;
8.1.4.2 Originals of all Records and
Plans;
8.1.4.3 Originals of all Licenses
and Permits; and
8.1.4.4 Originals of all Warranties.
8.1.5 Title Insurance. The Title Company
will have issued or have unconditionally and irrevocably
committed to issue the Title Policy to Buyer.
8.1.6 Intentionally omitted.
8.1.7 Loan Approval. Lender and all
rating agencies shall have unconditionally consented to the
assignment and assumption of the Loan to Buyer on terms
reasonably acceptable to Buyer, and shall have executed and
delivered to Escrow Holder, the Assignment, Assumption and
Consent Agreement; provided, however, in the event that Lender
elects not to unconditionally consent to the assignment and
assumption of the Loan to Buyer by October 30, 1997, then Buyer
shall have the right to terminate this Agreement upon written
notice thereof to Seller and Escrow Holder, in which event the
Deposit, and any interest accrued thereon, and the Loan
Assumption Fee Deposit shall be returned to Buyer without further
instructions from Seller, and all of the rights and obligations
of the parties existing hereunder shall terminate and be of no
further force or effect except any rights and obligations which
are expressly stated to survive the termination of the Agreement.
8.1.8 CBS' Right to Purchase. Buyer
shall have received evidence reasonably satisfactory to Buyer
that CBS shall have elected in writing not to purchase the
Property or otherwise waived its right to purchase the Property
pursuant to its lease for Suite 300 of the Property.
8.2 Seller's Conditions. Seller shall not be
required to close the transaction provided for under this
Agreement, unless and until Seller deems that each and every one
of the following conditions has been fulfilled:
8.2.1 Representations and Warranties of
Buyer. The representations and warranties set forth in this
Agreement made by Buyer shall be true and correct as of the
Closing in all respects.
8.2.2 Buyer's Deliveries. Buyer shall
have duly and timely delivered to Escrow Holder all of the items
described in Section 4.2 of this Agreement.
90 Intentionally omitted.
100 PRORATIONS. The following are to be prorated as
of the Closing Date, as follows:
10.1 Current Rent. Current rents under the Leases
shall be prorated as of the Closing Date, regardless of whether
such rents have been paid to Seller.
10.2 Rent Arrears. With respect to any rent
arrears arising under the Leases, Buyer shall pay to Seller any
rents actually collected that are applicable to the period
preceding the Closing Date, less reasonable collection charges;
provided, however, that it is hereby understood and agreed that
all rents collected by Buyer shall be applied first to unpaid
rents accruing after the Closing Date, and then, only after all
such past due rents have been collected, to unpaid rents accruing
prior to the Closing Date.
10.3 Tenant Improvement Allowances and Rent
Credits. Buyer shall receive a credit against the Purchase Price
at Closing for all unpaid tenant improvement allowances and rent
credits under the leases entered into with Bet Tzedek and Xxx &
Associates.
10.4 Security Deposits. The security deposits
paid by the tenants pursuant to the Leases, and any interest
required to be paid thereon, shall be fully credited to Buyer at
Closing.
10.5 Other Prorations. Liability for all real
property taxes, common area maintenance, Property operation
expenses, and other recurring costs which are not otherwise paid
directly by tenants shall be prorated as of the Closing Date;
provided, however, Buyer shall not be responsible for any costs
or expenses pertaining to Service Contracts or items of expense
which Buyer has not approved in writing. Seller shall remain
liable for any supplemental taxes attributable to any period
prior to the Closing. If any such supplemental taxes shall be
billed to Buyer or levied against the Property after the Closing,
then Seller agrees to pay its prorated share thereof to Buyer
within thirty (30) days of demand therefor by Buyer. Any such
sums not paid when due may be advanced by Buyer, and such amounts
shall bear interest from the date of advance by Buyer until paid
by Seller at the maximum contract rate permitted by law.
10.6 Preliminary Closing Adjustment. Seller and
Buyer shall jointly prepare a preliminary closing adjustment
computation on the basis of the Leases and other sources, and
shall deliver such computation to the Escrow Holder prior to
Closing.
10.7 Post-Closing Reconciliation. All items
described in this Section 10 that are capable of being prorated
as of the Closing Date, shall be prorated as of the Closing Date.
All other items shall be reconciled within one hundred eighty
(180) days after the Closing Date to the extent that such items
may be reconciled within such one hundred eighty (180) day
period, or, to the extent such items may not be reconciled within
such one hundred eighty (180) day period, when such items may
first be reconciled after Closing.
10.8 Survival. The provisions of this Section 10
shall survive Closing.
110 COSTS AND EXPENSES. The closing costs shall be
allocated as follows:
11.1 Seller. Seller shall pay all premiums for
the CLTA portion of the Title Policy, all state and county
transfer taxes, all sales taxes, any other tax or assessment
imposed as a result of the transactions contemplated under this
Agreement, Seller's share of prorations, and any document
recording charges and notary fees, including, without limitation,
any recording fees and notary charges with respect to the Deed.
11.2 Buyer. Buyer shall be responsible for
its share of prorations and all premiums for the Title Policy and
any endorsements requested by Buyer in excess of the cost of the
CLTA portion of the Title Policy without any endorsements.
11.3 Other Closing Costs. Buyer and Seller shall
each pay one-half (1/2) of all escrow fees. Except for an amount
up to the Lender's Legal Fees Reimbursement which is payable by
Buyer, each party will pay their own legal and professional fees
and fees of other consultants incurred by Buyer and Seller,
respectively.
11.4 Delivery of Possession. Simultaneously with
the Closing, Seller shall deliver possession and enjoyment of the
Property to Buyer and Buyer shall thereupon have the immediate
right to possess, develop, use, sell, encumber and/or transfer
the Property, or any part thereof for its own account to the
total exclusion of Seller.
120 CONDEMNATION AND DESTRUCTION:
12.1 Eminent Domain or Taking. If proceedings
under a power of eminent domain relating to the Property or any
part thereof are commenced prior to the Closing Date, Seller
shall promptly inform Buyer in writing.
12.1.1 If such proceedings involve the
taking of title to all or any Material (defined below) interest
in the Property, Buyer may elect to terminate this Agreement by
notice in writing sent within thirty (30) days of Seller's
written notice to Buyer, in which case the Deposit and that
portion of the Loan Assumption Fee deposited with Escrow Holder,
and any interest thereon, shall be returned to Buyer without any
further instructions from Seller, and neither party shall have
any further obligation to or rights against the other except any
rights or obligations of either party which are expressly stated
to survive termination of this Agreement.
12.1.2 If the proceedings do not involve
the taking of title to all or a Material interest in the Property
or if Buyer does not elect to terminate this Agreement, this
transaction will be consummated as described in this Agreement
and any award or settlement payable with respect to such
proceeding will be paid or assigned to Buyer upon the Closing.
12.1.3 For purposes of Sections 12.1 and
12.2, "Material" shall mean a taking which Buyer reasonably
determines materially and adversely affects the value or
operations of the Property.
12.2 Damage or Destruction. Except as provided in
this paragraph, prior to the Close of Escrow the entire risk of
loss of damage by earthquake, flood, hurricane, landslide, fire
or other casualty is borne and assumed by Seller. If, prior to
the Closing Date, any part of the Property is damaged or
destroyed by earthquake, flood, landslide, fire or other
casualty, Seller will promptly inform Buyer of such fact in
writing and advise Buyer as to the extent of the damage.
12.2.1 If such damage or destruction is
Material, Buyer and Seller each has the option to terminate this
Agreement upon written notice to the other party given not later
than thirty (30) days after receipt of Seller's written notice to
Buyer advising of such damage or destruction.
12.2.2 If this Agreement is so
terminated, the Deposit and any interest thereon, shall be
returned to Buyer without any further instructions from Seller,
Seller shall immediately pay to Buyer an amount equal to the Loan
Assumption Fee Deposit, and neither party shall have any further
obligation to or rights against the other except any rights or
obligations of either party which are expressly stated to survive
termination of this Agreement.
12.2.3 If Buyer does not timely exercise
this option to terminate this Agreement, or if the casualty is
not Material, Seller will assign to Buyer all of Seller's right,
title and interest in and to any and all insurance proceeds under
Seller's insurance policies relating to such damage or
destruction, and shall reduce the Purchase Price by the amount of
the deductible and any other amount not covered by insurance
under such policies (including reasonably anticipated post-
Closing rental loss, except to the extent covered by insurance,
through to completion of such repair and restoration resulting
from such casualty), and this transaction will close pursuant to
the terms of this Agreement.
12.2.4 Survival. The provisions of this
Section 12 shall survive the Closing.
130 REMEDIES:
13.1 Buyer's Remedies. IN THE EVENT THAT SELLER
SHALL FAIL TO CONSUMMATE THIS AGREEMENT FOR ANY REASON, EXCEPT
BUYER'S DEFAULT OR A TERMINATION OF THIS AGREEMENT BY BUYER OR
SELLER PURSUANT TO A RIGHT TO DO SO UNDER THE PROVISIONS HEREOF,
BUYER SHALL HAVE THE FOLLOWING REMEDIES, WHICH SHALL BE BUYER'S
SOLE AND EXCLUSIVE REMEDIES BASED UPON A DEFAULT BY SELLER. SUCH
REMEDIES SHALL NOT BE CUMULATIVE, MEANING BUYER MAY EXERCISE ONE
(1) BUT NOT BOTH OF SUCH REMEDIES. BUYER SHALL DELIVER TO SELLER
AND ESCROW HOLDER NOTICE OF ITS ELECTION OF REMEDIES WITHIN TWO
(2) DAYS AFTER SELLER'S DEFAULT. THE SOLE REMEDIES AVAILABLE TO
BUYER ARE AS FOLLOWS:
(i) BUYER MAY TERMINATE THIS AGREEMENT, IN
WHICH CASE ESCROW HOLDER SHALL IMMEDIATELY RETURN THE DEPOSIT,
TOGETHER WITH ANY INTEREST EARNED THEREON, TO BUYER, UPON
EXECUTION OF CANCELLATION INSTRUCTIONS BY BUYER. SELLER SHALL
PAY ANY ESCROW CANCELLATION CHARGES AND SHALL IMMEDIATELY PAY TO
BUYER UPON BUYER'S DEMAND THEREFOR AN AMOUNT EQUAL TO THE SUM OF
THAT PORTION OF THE LOAN ASSUMPTION FEE DEPOSIT, SELLER'S LEGAL
FEES REIMBURSEMENT PLUS THE LOAN SERVICING FEE. IN ADDITION,
BUYER SHALL HAVE THE RIGHT TO PURSUE AN ACTION AGAINST SELLER FOR
ALL ACTUAL OUT-OF-POCKET (BUT NOT CONSEQUENTIAL OR LOST PROFITS)
DAMAGES SUFFERED BY BUYER; OR
(ii) BUYER MAY BRING AN ACTION FOR SPECIFIC
PERFORMANCE AGAINST SELLER WITH RESPECT TO THIS AGREEMENT BUT
ONLY UNDER THE FOLLOWING CONDITIONS AND CIRCUMSTANCES:
(a) BUYER SHALL HAVE FULLY PERFORMED
ALL OBLIGATIONS OF BUYER UNDER THIS AGREEMENT, EXCEPT THAT WITH
RESPECT TO DEPOSITING THE BALANCE OF THE PURCHASE PRICE AND THE
BALANCE OF THE LOAN ASSUMPTION FEE, BUYER SHALL HAVE EVIDENCED TO
SELLER'S REASONABLE SATISFACTION THAT BUYER IS READY, WILLING AND
ABLE TO TIMELY DEPOSIT SAID FUNDS IN ESCROW;
(b) THE ACTION SHALL BE COMMENCED,
AND SERVICE OF PROCESS UPON SELLER MADE, NOT LATER THAN FORTY-
FIVE (45) DAYS AFTER SELLER'S DEFAULT; AND
(c) ALL OF THE ISSUES IN SUCH ACTION,
WHETHER OF FACT OR LAW, SHALL BE HEARD BY A REFERENCE PROCEEDING
PURSUANT TO CALIFORNIA CODE OF CIVIL PROCEDURE, SECTION 638,
ET. SEQ. WITHIN TEN (10) DAYS FOLLOWING THE COMMENCEMENT OF ANY
SUCH ACTION, THE PARTIES SHALL MAKE APPLICATION TO THE COURT IN
WHICH THE ACTION IS PENDING FOR THE APPOINTMENT OF A RETIRED
SUPERIOR COURT JUDGE OR COURT OF APPEAL JUSTICE FROM THE THEN
CURRENT LIST OF RETIRED JUDGES AVAILABLE TO SERVE AS REFEREES IN
THE COUNTY IN WHICH SUCH ACTION IS COMMENCED TO SERVE AS THE
REFEREE. THE REFEREE CHOSEN SHALL BE DEEMED QUALIFIED ONLY IF HE
IS WILLING TO AGREE TO HEAR THE SUBJECT ACTION WITHIN TWENTY (20)
DAYS FOLLOWING THE DATE OF APPLICATION TO THE COURT, TO HEAR THE
SUBJECT ACTION ON CONSECUTIVE DAYS AND TO RENDER A DECISION
WITHIN A FURTHER FIFTEEN (15) DAY PERIOD. THE PARTIES SHALL
ADVANCE, IN EQUAL SHARES, THE FEES AND EXPENSES OF THE REFEREE
SELECTED PURSUANT TO THIS PROVISION, BUT THE LOSING PARTY IN ANY
SUCH ACTION SHALL REIMBURSE THE PREVAILING PARTY FOR ANY AND ALL
FEES AND EXPENSES PREVIOUSLY ADVANCED BY SUCH PREVAILING PARTY
FOR THE REFEREE.
13.2 Seller's Remedies. IF BUYER SHOULD FAIL TO
CONSUMMATE THIS AGREEMENT AS A RESULT OF BUYER'S DEFAULT UNDER
THE TERMS OF THIS AGREEMENT, THEN SELLER, AS ITS SOLE AND
EXCLUSIVE REMEDY, MAY TERMINATE THIS AGREEMENT BY NOTIFYING BUYER
THEREOF AND RECEIVE OR RETAIN THE DEPOSIT AS LIQUIDATED DAMAGES.
THE PARTIES AGREE THAT SELLER WILL SUFFER DAMAGES IN THE EVENT OF
BUYER'S DEFAULT ON ITS OBLIGATIONS. ALTHOUGH THE AMOUNT OF SUCH
DAMAGES IS DIFFICULT OR IMPOSSIBLE TO DETERMINE, THE PARTIES
AGREE THAT THE AMOUNT OF THE DEPOSIT IS A REASONABLE ESTIMATE OF
SELLER'S LOSS IN THE EVENT OF BUYER'S DEFAULT. THUS, SELLER
SHALL ACCEPT AND RETAIN THE DEPOSIT AS LIQUIDATED DAMAGES BUT NOT
AS A PENALTY. SELLER HEREBY ACKNOWLEDGES AND AGREES SUCH
LIQUIDATED DAMAGES SHALL CONSTITUTE SELLER'S SOLE AND EXCLUSIVE
REMEDY AND SELLER HEREBY WAIVES THE PROVISIONS OF CALIFORNIA
CIVIL CODE SECTION 3389 AND ANY OTHER APPLICABLE EXISTING OR
FUTURE LAW PERMITTING A CONTRACT TO BE ENFORCED EVEN THOUGH
DAMAGES ARE LIQUIDATED FOR ITS BREACH. NOTWITHSTANDING THE
FOREGOING, FOR PURPOSES OF THIS SECTION 13.2 ONLY, THE "DEPOSIT"
SHALL ALSO INCLUDE THE LOAN ASSUMPTION FEE DEPOSIT, LOAN
SERVICING FEE AND LENDER'S FEE REIMBURSEMENT (ALTHOUGH SELLER
ACKNOWLEDGES THAT TO THE EXTENT LENDER, AMRESCO OR LENDER'S
COUNSEL IS ENTITLED TO ANY SUCH AMOUNTS UNDER THE TERMS OF THIS
AGREEMENT OR OTHERWISE, SUCH AMOUNTS SHALL BE PAID TO SUCH
APPLICABLE PARTIES AND SELLER SHALL HAVE NO RIGHT OR INTEREST IN
ANY SUCH AMOUNTS).
SELLER AND BUYER ACKNOWLEDGE THAT THEY HAVE READ AND
UNDERSTAND THE PROVISIONS OF THE FOREGOING PROVISION AND BY THEIR
INITIALS IMMEDIATELY BELOW AGREE TO BE BOUND BY ITS TERMS.
Seller: /s/ EG Buyer: /s/ RSZ
14. 1031 EXCHANGE. Seller may structure the sale of
the Real Property as a like-kind exchange under Internal Revenue
Code Section 1031 at Seller's sole cost and expense. Buyer shall
reasonably cooperate therein (which cooperation may include the
execution by Buyer of such additional documents and transactions
as may be requested by Seller), provided that no delay in the
Closing shall result therefrom and Buyer shall incur no costs,
expenses or liabilities in connection with Seller's exchange. If
Seller uses a qualified intermediary to effectuate the exchange,
any assignment of the rights or obligations of Seller hereunder
shall not relieve, release or absolve Seller of its obligations
to Buyer.
15. BROKERAGE COMMISSIONS. Each party hereby
represents and warrants to the other that except for brokerage
commission due to Broker under a separate agreement between
Seller and Broker, the payment of which commissions shall be the
sole responsibility of Seller, neither party has incurred any
obligation to any third party for the payment of any real estate
commission, finder's fee or other like sum in connection with the
sale of the Property to Buyer, and each party hereby agrees to
indemnify and hold the other party harmless from and against any
and all claims, demands, causes of action and costs, including
attorneys' fees and costs, made, brought or sought against or
from the other arising out of any agreement for the payment of a
real estate commission, finder's fee or other like sum entered
into between either party and a third party in connection with
the sale of the Property to Buyer.
16. NOTICES. All notices, requests, demands or
documents which are required or permitted to be given or served
hereunder shall be in writing and (a) delivered personally,
(b) delivered by a national overnight courier (i.e., FedEx), or
(c) transmitted by facsimile, addressed as follows:
To Seller at: Xxxxxxx Xxxxxxxxxx
0000 X. Xxxxxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Facsimile: (000) 000-0000
with a copy to:
Xxxxx, Xxxxx & Xxxxxx
0000 Xxxxxxxx Xxxxxxxxx, 0xx Xxxxx
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
Attn: Xxx Silver, Esq.
Facsimile: (000) 000-0000
To Buyer at: Arden Realty Limited Partnership
0000 Xxxxxxxx Xxxx., Xxxxx 000 X
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
Attn: Mr. Xxxxxx Xxxxxxx
Xxxxxx Xxxxx, Esq.
Facsimile: (000) 000-0000
with a copy to:
Jeffer, Mangels, Xxxxxx & Xxxxxxx LLP
2121 Avenue of the Stars, Xxxxx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxx X. Xxxx, Esq.
Xxxx X. Xxxxxxxxx, Esq.
Facsimile: (000) 000-0000
Notice shall be deemed to have been delivered only upon actual
delivery to the intended addressee in the case of either
personal, courier, or facsimile delivery. The addresses for
purposes of this paragraph may be changed by giving written
notice of such change in the manner provided herein for giving
notices. Unless and until such written notice is delivered, the
latest information stated by written notice, or provided herein
if no written notice of change has been delivered, shall be
deemed to continue in effect for all purposes hereunder.
17. ASSIGNMENT.
17.1 Assignment by Buyer. Buyer may assign
its rights and obligations under this Agreement to any
corporation, partnership, trust, limited liability company, or
other entity in which Buyer or any affiliate of Buyer is a
general partner, managing member, or otherwise controls. Except
as set forth above, Buyer may not, voluntarily or by operation of
law, assign or otherwise transfer any of its rights or
obligations under this Agreement.
17.2 Buyer Assignee's Rights and
Obligations. In the event of any such assignment by Buyer, the
assignee shall be and become (i) the grantee of the Deed, (ii)
the insured owner under the Title Policy, (iii) the assignee of
any other items of consideration Seller is to assign to Buyer
under this Agreement and (iv) the person or entity having the
right or obligation to (a) deliver statements, (b) deliver
documents, (c) give approvals, (d) waive conditions or (e) make
demands, all as may be permitted or required by this Agreement
and not then already accomplished by Buyer or another assignee.
18. MISCELLANEOUS:
18.1 Survival. The representations and
warranties contained in this Agreement shall survive for a period
of twelve (12) months following the Closing Date.
18.2 Parties in Interest. As and when used
herein, the terms, "Seller" and "Buyer" mean and include, and
this Agreement their respective successor and assigns and shall
be binding upon and inure to the benefit of, the above-named
Seller and Buyer and their respective successors and permitted
assigns.
18.3 Section Headings. The headings of sections
are inserted only for convenience and shall in no way define,
describe or limit the scope or intent of any provision of this
Agreement.
18.4 No Oral Modifications. This Agreement may
not be amended or modified except in writing executed by all
parties hereto.
18.5 Full Integration. Buyer and Seller each
acknowledge that there are no other agreements or representa
tions, either oral or written, express or implied, that are not
embodied in this Agreement, and this Agreement, the Exhibits
attached to this Agreement, and the Transfer Documents, represent
a complete integration of all the prior and contemporaneous
agreements and understandings and documents.
18.6 Binding Effect. This Agreement shall be
binding upon and inure to the benefit of the parties hereto, and
their respective successors and assigns, and no other party shall
be a beneficiary hereunder.
18.7 Seller's Advice of Counsel. Seller
acknowledges that (a) Buyer has not made any representation as to
the Federal or State tax implications relating to the
transactions contemplated herein, (b) Seller has thoroughly read
and reviewed the terms and provisions of this Agreement and the
Exhibits attached hereto and is familiar with the terms of this
Agreement, (c) the terms and provisions contained in this
Agreement are clearly understood by Seller and have been fully
and unconditionally consented to by it, (d) Seller has had full
benefit and advice of counsel of its own selection, in regard to
understanding the terms, meaning and effect of this Agreement,
(e) the execution of this Agreement and of the other documents
executed pursuant to this Agreement is done freely, voluntarily,
with full knowledge, and without duress, (f) in executing this
Agreement, Seller is relying on no other representations, either
written or oral, express or implied, made to it by any other
party to this Agreement, and the consideration received by it
under this Agreement has been actual and adequate.
18.8 Attorneys' Fees. If an action is commenced
by a party hereto resulting from a dispute with respect to the
transactions contemplated herein, the prevailing party shall be
entitled to recover its attorneys' fees and costs from the other
party in such action. As used herein, the term "attorneys' fees"
means attorneys' fees whether or not litigation ensues and if
litigation ensues whether incurred at trial, on appeal, on
discretionary review or otherwise.
18.9 Governing Law. This Agreement will be
governed by, interpreted under, and construed and enforced in
accordance with the laws of the State of California.
18.10 Confidentiality. Unless otherwise
agreed to in writing by Seller and Buyer, each party will use
reasonable efforts to keep confidential the terms of this
Agreement, the possible sale of the Property, and all documents,
financial statements, reports or other information provided to,
or generated by the other party relating to the Property, and
will use reasonable efforts to not disclose any such information
to any person other than (a) those employed by Seller or Buyer;
(b) those who are actively and directly participating in the
evaluation of the Property and the negotiation and execution of
this Agreement or financing of the purchase of the Property; and
(c) governmental, administrative, regulatory or judicial authori
ties in the investigation of the compliance of the Property with
applicable legal requirements; and (d) third parties as required
under applicable law. The provisions of this paragraph will
survive the termination of this Agreement other than by Closing.
18.11 Captions. The captions contained in
this Agreement are for convenience only and are not intended to
limit or define the scope or effect of any provision of this
Agreement.
18.12 Severability. The invalidity,
illegality or unenforceability of any provision of this Agreement
shall not affect the enforceability of any other provision of
this Agreement, all of which shall remain in full force and
effect.
18.13 Time of the Essence. Time is of the
essence of this Agreement and of the obligations required
hereunder.
18.14 Non-Waiver. No delay or failure by any
party to exercise any right hereunder, and no partial or single
exercise of any such right, shall constitute a waiver of that or
any other right, unless otherwise expressly provided herein.
18.15 Facsimile. The parties hereto and
their respective successors and assigns are hereby authorized to
rely upon the signatures of each person and entity on this
Agreement which are delivered by facsimile as constituting a duly
authorized, irrevocable, actual, current delivery of this
Agreement with original ink signatures of each person and entity.
18.16 Further Assurances. Buyer and Seller
agree to execute all documents and instruments reasonably
required in order to consummate the purchase and sale
contemplated in this Agreement and carry out the terms and
provisions hereof.
18.17 Joint and Several Liability. The
obligations of Seller under this Agreement and the other
documents executed pursuant to this Agreement shall be joint and
several.
18.18 Counterparts. This Agreement may be
executed in any number of counterparts and each such counterpart
shall be deemed to be an original, but all of which, when taken
together, shall constitute one Agreement.
18.19 Seller's Indemnities. Seller's
indemnities set forth in Sections 6.8 and 6.11 hereof shall
survive the Closing and the execution and delivery of the Deed.
18.20 Reimbursement of Costs to Buyer. In
the event CBS exercises its "First Right to Purchase" under the
terms of its lease at the Property, Seller shall reimburse Buyer
for all costs incurred by Buyer in connection with (i) the
negotiation and preparation of this Agreement, and (ii) Buyer's
due diligence investigation and analysis of the Property. Such
costs shall include, without limitation, attorneys' fees,
consultants' fees, inspection fees and costs of any studies or
reports prepared on behalf of Buyer. Seller shall reimburse
Buyer for any such costs within five (5) business days after
Seller's receipt of a demand therefor (which demand shall include
invoices reflecting the costs for which reimbursement is sought).
[SIGNATURES BEGIN ON FOLLOWING PAGE]
Buyer and Seller have executed this Agreement as of the
date written above.
"SELLER"
FAIRFAX CENTRE, LLC,
a California limited liability company
By: /s/ Elliot Gottfrucht
Xxxxxx Xxxxxxxxxx
Its: Co-Manager
By: Indoprop, LLC, a California
limited liability company
Its: Co-Manager
By: /s/ Xxxx Xxxxxxx
Xxxx Xxxxxxx
Its: Manager
"BUYER"
ARDEN REALTY LIMITED PARTNERSHIP,
a Maryland limited partnership
By: Arden Realty, Inc., a Maryland
corporation
Its: general partner
By: /s/ Xxxxxxx X. Xxxxx
Xxxxxxx X. Xxxxx
Its: CEO
