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EXHIBIT 10.10
CONTRACT OF SALE
BETWEEN
DRM THIRTY-TWO REALTY CORPORATION
SELLER
AND
RAMCO-XXXXXXXXXX PROPERTIES, L.P.
PURCHASER
Dated: July 7, 1997
Shopping Center Premises:
Highland Square, Crossville, Tennessee
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TABLE OF CONTENTS
PAGE
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1. DEFINITIONS.................................................... 1
2. SUBJECT OF SALE................................................ 4
3. PURCHASE PRICE................................................. 4
4. "SUBJECT TO" PROVISIONS........................................ 5
5. SPACE LEASES................................................... 6
6. LEASING PRACTICE............................................... 6
7. APPORTIONMENTS AND REIMBURSEMENTS.............................. 7
8. VIOLATIONS..................................................... 10
9. PENDING TAX PROCEEDINGS........................................ 10
10. "AS-IS"........................................................ 10
11. BROKER......................................................... 11
12. DESTRUCTION OR CONDEMNATION.................................... 11
13. STATUS OF TITLE................................................ 12
14. CLOSING........................................................ 12
15. NOTICES........................................................ 12
16. FRANCHISE TAXES................................................ 13
17. TITLE REPORT................................................... 13
18. NON-PERMITTED TITLE OBJECTIONS................................. 13
19. RETURN OF DEPOSIT.............................................. 15
20. AFFIDAVIT REGARDING JUDGMENTS.................................. 15
21. ASSIGNMENT OF THIS CONTRACT.................................... 15
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22. DEED; TRANSFER TAXES............................................ 16
23. PURCHASER'S DEFAULT............................................. 16
24. ESCROW OF DEPOSIT............................................... 17
25. REPRESENTATIONS................................................. 18
26. CLOSING DOCUMENTS............................................... 21
27. FURTHER ASSURANCES.............................................. 23
28. PURCHASER'S DUE DILIGENCE PERIOD................................ 24
29. ENTITY CONSENTS; PURCHASER'S REPRESENTATIONS.................... 25
30. MISCELLANEOUS................................................... 26
EXHIBITS AND SCHEDULES:
Schedule A: Description of Property
Schedule B: Permitted Exceptions
Schedule C: Rent Roll
Schedule D: Escrowee's Wire Transfer Instructions
Schedule E: Existing Mortgage
Schedule F: List of Tax Protests
Exhibit 1: Form of Assignment and Assumption of Space Leases
Exhibit 2: Form of Tenant Estoppel Certificate
Exhibit 3: Form of Assignment and Assumption of Service Contracts
Exhibit 4: Form of Letter of Credit
Exhibit 5: Form of Title Certification
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CONTRACT (this "Contract") made this 7th day of July, 1997 by
and between DRM THIRTY-TWO REALTY CORPORATION, an Alabama corporation having an
address c/o DRA Advisors, Inc., 1180 Avenue of the Americas, Xxx Xxxx, Xxx Xxxx
00000 ("Seller") and RAMCO-XXXXXXXXXX PROPERTIES, L.P., a Delaware limited
partnership having an address at 00000 Xxxxxxxxxxxx Xxxxxxx (Xxxxx 000)
Xxxxxxxxxx, Xxxxxxxx 00000 ("Purchaser").
W I T N E S S E T H :
WHEREAS, upon the terms and conditions hereinafter set forth,
Seller agrees to sell and convey fee title to that certain parcel of land
described on Schedule A, annexed hereto and made a part hereof, with the
buildings and improvements erected thereon (which parcel of land and the
improvements erected thereon are herein referred to as the "Property") to
Purchaser and Purchaser agrees to purchase the Property.
NOW, THEREFORE, the parties agree as follows:
1. DEFINITIONS. The terms defined in this Section 1 shall for
all purposes of this Contract have the meaning herein specified unless the
context requires otherwise.
(a) "Additional Deposit" shall have the meaning ascribed to
it in Section 3(a).
(b) "Affiliates" shall have the meaning ascribed to it in
Section 25(a)(xii). (c) "Anchor Space Tenant" shall have the meaning ascribed to
it in Section 12(b).
(d) "Arrears" shall have the meaning ascribed to it in
Section 7(a)(i)(A).
(e) "Cash Deposit" shall have the meaning ascribed to it in
Section 3(a)(i). (f) "Closing" shall have the meaning ascribed to it in Section
14(a).
(g) "Closing Date" shall have the meaning ascribed to it in
Section 14(a).
(h) "Code" shall have the meaning ascribed to it in Section
25(a)(vii).
(i) "Consent and Assumption Agreement" shall have the
meaning ascribed to it in Section 4(b)(i).
(j) "Deed" shall have the meaning ascribed to it in Section
22(a).
(k) "Deposit" shall have the meaning ascribed to it in
Section 3(a).
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(l) "ERISA" shall have the meaning ascribed to it in
Section 29(c).
(m) "Escrowee" shall have the meaning ascribed to it in
Section 3(a).
(n) "Estoppel Certificate" shall have the meaning ascribed
to it in Section 26(a)(vii).
(o) "Estoppel Default" shall have the meaning ascribed to
it in Section 26(a)(vii)(B).
(p) "Existing Mortgage" shall have the meaning ascribed to
it in Section 4(a).
(q) "Evaluation Material" shall have the meaning ascribed
to it in Section 28(d).
(r) "Initial Deposit" shall have the meaning ascribed to it
in Section 3(a).
(s) "Letter of Credit" shall have the meaning ascribed to
it in Section 3(a)(i).
(t) "Lender" shall have the meaning ascribed to it in
Section 4(b)(i).
(u) "Loan Documents" shall have the meaning ascribed to it
in Section 4(a).
(v) "Maximum Representation Expense" shall have the meaning
ascribed to it in Section 25(e).
(w) "Maximum Title Expense" shall have the meaning ascribed
to it in Section 18(c).
(x) "Mortgage Expenses" shall have the meaning ascribed to
it in Section 4(d).
(y) "New Space Lease" shall have the meaning ascribed to it
in Section 6(a).
(z) "Non-Permitted Title Objections" shall have the meaning
ascribed to it in Section 18(a).
(aa) "Obligors" shall have the meaning ascribed to it in
Section 4(b)(i).
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(ab) "Overage Rent" shall have the meaning provided in
Section 7(a)(i)(B).
(ac) "Permitted Exceptions" shall have the meaning ascribed
to it in Section 13.
(ad) "Premises" shall have the meaning ascribed it in
Section 2(b).
(ae) "Property" shall have the meaning ascribed to it in
the "WHEREAS" paragraph in this Contract.
(af) "Purchase Price" shall have the meaning ascribed to it
in Section 3.
(ag) "Purchaser's Due Diligence Period" shall have the
meaning ascribed to it in Section 28(a).
(ah) "Related Parties" shall have the meaning ascribed to
it in Section 28(e).
(ai) "Seller's Certificate" shall have the meaning ascribed
to it in Section 26(a)(vii)(A).
(aj) "Service Contracts" shall have the meaning ascribed to
it in Section 25(a)(iv).
(ak) "Space Leases" shall have the meaning ascribed to it
in Section 5.
(al) "Space Tenants" shall have the meaning ascribed to it
in Section 5.
(am) "Substantial Loss" shall have the meaning ascribed to
it in Section 12(b).
(an) "Title Company" shall have the meaning ascribed to it
in Section 17.
(ao) "Transfer Tax" shall have the meaning ascribed to it
in Section 22(b).
(ap) "Violation(s) " shall have the meaning ascribed to it
in Section 8.
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2. SUBJECT OF SALE.
(a) Seller agrees to sell and convey to Purchaser the Premises
and Purchaser agrees to purchase from Seller the Premises subject to the terms
and conditions contained in this Contract.
(b) This sale includes any right, title and interest of Seller
in and to: (i) the Property (and any other property adjacent thereto owned by
Seller); (ii) any land lying in the bed of any street, road or avenue opened or
proposed, in front of or adjoining the Property, to the center line thereof, and
all right, title and interest of Seller in and to any award made or to be made
in lieu thereof and in and to any unpaid award for damage to the Property by
reason of change of grade of any street; and Seller will execute and deliver to
the Purchaser at the Closing, or thereafter, on demand, all proper instruments
for the conveyance of such title and the assignment and collection of any such
award; (iii) trade names, easements, permits, licenses and utility agreements,
and other appurtenances appurtenant to the Property, if any; (iv) fixtures,
equipment and other personal property attached to and appurtenant to the
Property and not owned by the Space Tenants, if any, but no part of the Purchase
Price shall be deemed to be paid for such fixtures, equipment or personal
property; (v) the Space Leases and the security deposits listed on Schedule C
annexed hereto; (vi) all plans and specifications for improvements to the
Property in the possession of Seller and any contracts, warranties and
guarantees, if any, with regard to the foregoing; and (vii) any mineral rights,
waters, water courses and hereditaments belonging to the Property and owned by
Seller ((i) through (vii) being referred to collectively as the "Premises").
3. PURCHASE PRICE.
The purchase price for the Premises is the sum of Nine Million
Fifty- Nine Thousand and 00/100 Dollars ($9,059,000.00), (the "Purchase Price")
which shall be paid by Purchaser to Seller as follows:
(a) (i) Sixty-Six Thousand Six Hundred Sixty-Six and 67/100
Dollars ($66,666.67) (the "Initial Deposit") on the signing of this Contract
payable to Xxxxxx Xxxxx- xxxxx LLP ("Escrowee"), receipt of which is hereby
acknowledged by the Escrowee and (ii) Two Hundred Sixty-Six Thousand Six Hundred
Sixty-Six and 67/100 Dollars ($266,666.67) (the "Additional Deposit") payable to
Escrowee on or before September 5, 1997, time being of the essence. The Initial
Deposit and the Additional Deposit, to the extent actually paid and received,
together with any interest earned thereon is referred to collectively herein as
the "Deposit." The Deposit shall include the Cash Deposit or any Letter of
Credit or the proceeds therefrom. The Initial Deposit and the Additional Deposit
may be paid, at Purchaser's option, by (A) electronic wire transfer in
accordance with the instructions set forth on Schedule D attached hereto of
immediately available federal funds, or by good certified check of Purchaser or
bank teller's check to the order of Escrowee (individually or collectively (the
"Cash Deposit") or (B) delivering to Escrowee an irrevocable letter of credit,
in the amount of the Initial Deposit and/or the Additional Deposit issued to
Escrowee,
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as beneficiary, by BankBoston, N.A. in the form of Exhibit 4 (individually or
collectively, the "Letter of Credit"); and
(b) On the Closing Date, Eight Million Seven Hundred
Twenty-Five Thousand Six Hundred Sixty-Six and 66/100 Dollars ($8,725,666.66)
plus the amount of any Letter of Credit constituting all or a portion of the
Deposit, subject to the apportionments set forth in Section 7, as follows:
(i) approximately $5,947,170.14 by Purchaser assuming, and
taking title subject to, the then unpaid principal balance under the Existing
Mortgage (subject to the provisions of Section 4); and
(ii) the balance by electronic wire transfer of
immediately available federal funds pursuant to wiring instructions to be given
by Seller to Purchaser prior to the Closing.
4. "SUBJECT TO" PROVISIONS; MORTGAGE.
(a) The Premises are sold subject to (i) the exceptions set
forth on Schedule B attached hereto and (ii) the Existing Mortgage. "Existing
Mortgage" refers collectively to the mortgage loans described on Schedule E
attached hereto. Seller has delivered to Purchaser, and Purchaser acknowledges
receipt of, copies of the documents listed on Schedule E evidencing and securing
the Existing Mortgage (the "Loan Documents").
(b) Seller agrees not to partially or wholly prepay the
Existing Mortgage prior to the Closing (other than with respect to scheduled
monthly payments) provided the following conditions have been satisfied:
(i) Purchaser has, at its sole cost and expense, by not
later than September 5, 1997 entered into and provided Seller with a true copy
of an agreement, reasonably acceptable to Seller with respect to provisions
binding on Seller or relating to the release of Seller from liability (the
"Consent and Assumption Agreement") with the holder or holders (collectively the
"Lender") of the Existing Mortgage whereby the Lender consents to the sale of
the Property subject to the Existing Mortgage and Purchaser agrees to assume the
obligations of each borrower, guarantor and any other obligor (collectively, the
"Obligors") under the Loan Documents. Seller agrees to reasonably cooperate with
Purchaser in connection with obtaining the Consent and Assumption Agreement;
(ii) Purchaser complies with all of the requirements of
the Lender and the Consent and Assumption Agreement through the Closing Date;
and
(iii) as of the Closing, the Lender has released the
Obligors (and their partners, members, officers and/or shareholders) from any
and all obligations and liabilities under the Loan Documents which arise from
and after the Closing Date.
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(c) If any of the conditions set forth in subparagraph (b)
above are not satisfied with respect to the Existing Mortgage as of the date
then scheduled for the Closing, Seller, at its sole election, may either: (i)
close title and elect to pay off the applicable Existing Mortgage or (ii)
adjourn the Closing for such time as may be necessary to satisfy the conditions
or to pay off the Existing Mortgage.
(d) Purchaser shall, at the Closing, pay all fees and
expenses (the "Mortgage Expenses") due (or incurred by Seller) in connection
with or arising out of (i) the payoff of the Existing Mortgage (including any
prepayment charges) and/or (ii) Purchaser's assumption of the Existing Mortgage.
The provisions of this Section 4(d) shall survive the Closing.
(e) At the Closing, unless the Existing Mortgage is paid
off, Purchaser shall assume the obligations under the Existing Mortgage and the
Loan Documents and shall indemnify and hold Seller (and its partners, members,
officers and/or shareholders) harmless from and against all claims, causes of
action, liabilities, losses, deficiencies and damages, as well as costs and
expenses (including attorneys' fees and court costs), interest and penalties
related thereto, asserted against, or incurred by, Seller by reason of, or
resulting or arising from, events occurring under the Existing Mortgage and the
Loan Documents from and after the Closing Date. The provisions of this Section
4(e) shall survive the Closing.
5. SPACE LEASES. With respect to tenancies and occupancies set
forth on Schedule C attached hereto and made a part hereof, Purchaser represents
that it has examined, or will examine prior to the expiration of Purchaser's Due
Diligence Period, all leases and amendments thereto relating to such tenancies
and occupancies (which leases and any New Space Leases are collectively referred
to herein as the "Space Leases" and the lessees thereunder are herein called
"Space Tenants").
6. LEASING PRACTICE.
(a) Subject to Section 6(b) below, Seller may continue to
lease the Premises in a manner consistent with its past course of business and
in a commercially reasonable manner, including, without limitation and in its
sole discretion, the termination of existing Space Leases and/or the entering
into of new leases or renewals or modifications of existing Spaces Leases (such
new space lease, termination, renewal or modification is herein referred to as a
"New Space Lease") .
(b) (i) Prior to the expiration of Purchaser's Due
Diligence Period, Seller shall be permitted to enter into any New Space Lease
without the approval of Purchaser, provided Seller promptly notifies Purchaser
of the same. (ii) After the expiration of Purchaser's Due Diligence Period
provided Purchaser is not in default under this Contract, Seller shall not (A)
enter into a New Space Lease covering more than 7,500 square feet of rentable
space without obtaining the prior written consent of Purchaser, which consent
shall not be unreasonably withheld or delayed or (B) terminate any Space Lease
without the prior written consent of Purchaser except in the event of a default
by a Space Tenant under a
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Space Lease. Any New Space Lease which does not require Purchaser's consent
shall be arms-length and on then fair market terms and conditions (and shall
otherwise be consistent with Seller's customary leasing standards). (iii) Seller
and Purchaser shall apportion, at Closing, any tenant improvement expenses or
allowances and leasing commissions on account of a New Space Lease based on
their respective periods of ownership of the Premises during the term of such
New Space Lease.
(c) If Purchaser's consent is required under this Section 6
for the execution of a New Space Lease, Purchaser agrees to grant or deny its
consent in writing (and provide, in reasonable detail, the reasons for any
denial) within four (4) business days after request therefor. Purchaser's
failure to duly respond to Seller's request within four (4) business days after
request therefor shall be deemed a consent to the proposed New Space Lease. If
Purchaser's consent is not required, Seller's sole obligation shall be to notify
Purchaser prior to entering into any New Space Lease or terminating any Space
Lease.
(d) (i) Purchaser acknowledges and agrees that no
representation has been made and no responsibility has been assumed by Seller
with respect to the continued occupancy of the Premises, or any part thereof, by
the Space Tenants. Seller does not undertake or guarantee that the Space Tenants
will be in occupancy at the Closing. Prior to the Closing, Seller shall have the
right, but not the obligation, to enforce its rights against the Space Tenants
by summary proceeding or in any other manner. (ii) Notwithstanding the
provisions of subsection (d)(i) above, but subject to the provisions of
subsection (d)(iii) below, Purchaser shall have the right to cancel this
Contract in the event that, on the Closing Date, an Anchor Space Tenant shall
have filed a petition in bankruptcy and (A) an order has been executed by the
Bankruptcy Court granting such Anchor Space Tenant's application to reject its
Space Lease in bankruptcy or (B) fails to assume its Space Lease in bankruptcy.
(iii) In the event that, following the date of this Contract any Anchor Space
Tenant shall file a petition in bankruptcy, Seller, at Seller's election, shall
have the privilege to (C) reinstate such Anchor Space Tenant's Space Lease by
entering into a New Space Lease with such Anchor Space Tenant on substantially
similar terms and conditions as in such prior Space Lease, or (D) obtain
evidence, reasonably satisfactory to Purchaser, that such Anchor Space Tenant
has assumed its Space Lease in bankruptcy or (E) procure a substitute tenant for
the space covered by the Space Lease in question pursuant to a New Space Lease
reasonably acceptable to Purchaser, and for any purpose provided in
subparagraphs (C), (D) or (E) Seller shall be entitled to one or more
adjournments of the Closing for a period not to exceed one (1) year in the
aggregate; provided, however, that Purchaser shall have no obligation to close
title if, during such period of adjournment, an event occurs which materially
and adversely affects the Premises and such event is not corrected or cured to
the reasonable satisfaction of Purchaser.
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7. APPORTIONMENTS AND REIMBURSEMENTS.
(a) Unless otherwise provided, at the Closing the
following are to be reimbursed or apportioned as of 11:59 P.M. on the day
preceding the Closing Date based upon the respective party's period of ownership
for the item being apportioned. Notwithstanding the foregoing, in the event
Seller (or its designee) does not receive the funds to be wired pursuant to
Section 3(b) in time for Seller (or its designee) to invest same (or, if
applicable, to timely pay off the Existing Mortgage) on the Closing Date, then
in such event, the items set forth in this Section 7 shall be apportioned as of
11:59 P.M. on the Closing Date based upon the respective party's period of
ownership for the item being apportioned (The reimbursements and apportionments
shall be made based upon the actual number of days in the month in which the
Closing Date occurs.):
(i) Rent and additional rent under any Space
Leases for the month of Closing, as and when collected.
(A) If on the Closing Date there are any
past due rentals which have been billed to or are due by Space Tenants and not
collected (collectively "Arrears") Purchaser and Seller agree that the first
moneys received after the Closing by Purchaser or Seller from such Space Tenants
shall be applied (i) first to Seller and Purchaser for the month in which the
Closing occurred, prorated in accordance with this Section 7, (ii) then to
Purchaser toward any then current amounts owed by a Space Tenant to Purchaser
and (iii) then to Seller toward the Arrears owed by such Space Tenant. Purchaser
and Seller agree to remit promptly to the other the Arrears collected from time
to time to which the other is so entitled as hereinbefore provided. Purchaser
shall xxxx Space Tenants in Purchaser's customary manner and use reasonable
efforts in pursuing the collection of all Arrears for one (1) year following the
date of Closing. Purchaser shall have the right to deduct the greater of the
allocable share of Purchaser's reasonable out-of-pocket costs incurred in
collecting such Arrears or one (1%) percent of the Arrears collected on Seller's
behalf from amounts otherwise due Seller. The provisions of this Section
7(a)(i)(A) shall survive the Closing.
(B) As to any Space Lease(s) that
provide for the payment of additional rent based upon a percentage of the Space
Tenant's business during a specified annual or other period, or based upon
reimbursement for or payment of real estate taxes, operating expenses or
insurance expenses or otherwise (such additional rent being collectively called
"Overage Rent"), if the Closing shall occur prior to the time when any such
Overage Rent is payable, then such Overage Rent for the applicable accounting
period in which the Closing occurs shall be apportioned subsequent to the
Closing. Purchaser agrees that it will receive and hold such Overage Rent in
trust and pay over to the Seller the proportion of such Overage Rent as the
portion of such accounting period during which Seller was in title to the
Premises bears to the entire such accounting period. As to any Overage Rent in
respect to an accounting period that shall have expired prior to the Closing but
which shall become payable after the Closing, the Purchaser agrees that it will
receive and hold such Overage Rent in trust and pay the entire amount over to
the Seller upon receipt thereof. Purchaser shall have the right to deduct the
greater of the allocable share of
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Purchaser's reasonable out-of-pocket costs incurred in collecting such Overage
Rent or one (1%) percent of the Overage Rent collected on Seller's behalf from
amounts otherwise due Seller. Seller shall furnish to Purchaser all information
(including the form of the xxxx to be rendered) necessary for the billing of
such Overage Rent. Purchaser agrees that it shall render bills (calculated by
Seller if applicable to a period during Seller's ownership) for Overage Rent
following the Closing and shall, upon receipt thereof, promptly pay to the
Seller the amount to which the Seller is entitled as above provided. If
requested by either party, both parties will join in a letter to the respective
Space Tenants under such leases directing the division of Overage Rents in
accordance with the foregoing provisions hereof. To the extent that a Space
Tenant has the express right under its Space Lease to offset Overage Rent
against other amounts due under its Space Lease, same will be taken into account
in determining Overage Rent apportionments. Promptly after the calendar year in
which the Closing occurs, Seller and Purchaser shall reconcile all Overage Rent
due for such calendar year based upon actual expenses incurred during such year,
and such reconciled Overage Rent shall be reapportioned between Seller and
Purchaser (taking into account any Overage Rent retained by Seller at Closing
and collected by Purchaser after the Closing). The provisions of this Section
7(a)(i)(B) shall survive the Closing.
(ii) Water rates and water meter charges, if any, not
payable by the Space Tenants on the basis of the fiscal period for which
assessed. If there be a water meter, or meters, on the Premises (other than
meters under which charges are payable by the Space Tenant under the Space Lease
with Wal-Mart Stores, Inc.), the unfixed meter charges and the unfixed sewer
rent thereon for the time intervening from the date of the last reading shall be
apportioned on the basis of such last reading, and shall be appropriately
readjusted after the Closing on the basis of the next subsequent bills. As to
any water charges payable by the Space Tenant as aforementioned, if the Space
Tenant shall have failed to pay such water charges, such unpaid charges and the
liens, if any, resulting therefrom shall not be objections to title, or be the
basis of any claim whatsoever by Purchaser against Seller and Purchaser shall
close title in accordance with the terms of this Contract subject to such unpaid
charges and rents and such liens without abatement or credit against the
Purchase Price. The provisions of this Section 7(a)(ii) shall survive the
Closing.
(iii) Real estate, school and sewer taxes then due and
payable by Seller. As to any real estate, school and sewer taxes payable by the
Space Tenant under the Space Lease with Wal-Mart Stores, Inc., if such Space
Tenant shall have failed to pay such taxes, such unpaid taxes and the liens, if
any, resulting therefrom shall not be objections to title, or be the basis of
any claim whatsoever by Purchaser against Seller and Purchaser shall close title
in accordance with the terms of this Contract subject to such unpaid charges and
rents and such liens without abatement or credit against the Purchase Price. The
provisions of this Section 7(a)(iii) shall survive the Closing.
(iv) Charges under Service Contracts not terminated on or
prior to Closing and other expenses in connection with the operation of the
Premises.
(v) Unless the Existing Mortgage is paid off at Closing,
interest due under the Existing Mortgage for the month in which the Closing
occurs.
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(vi) Leasing expenses pursuant to Section
6(b), if any.
(b) At the Closing, Seller shall deliver to Purchaser the
Space Tenants' security deposits set forth in Schedule C annexed hereto, or
credit the Purchase Price on account of said security deposits; provided,
however, that if any Space Tenant is in default under the terms of its Space
Lease and has vacated its premises, Seller may retain so much of such Space
Tenant's security deposit as shall be sufficient to cover Seller's loss by
reason of the default. It is further agreed that nothing herein contained shall
be deemed to prevent Seller from applying security deposits prior to Closing in
order to liquidate any claim under any Space Lease or to compromise, adjust or
settle with any Space Tenant for the disposition of any claim by the application
of such security deposits provided such Space Tenant has vacated its premises.
(c) At the Closing, Seller shall receive a credit equal to
any escrows held by Lender which are transferred to Purchaser.
8. VIOLATIONS. (a) Subject to the provisions of subsection (b)
below, Purchaser shall accept the Premises subject to any notes or notices or
violations of law or municipal ordinances, orders or requirements imposed or
issued by any governmental or quasi-governmental authority having or asserting
jurisdiction, against or affecting the Premises (individually a "Violation" and
collectively "Violations") and any conditions which may result in Violations.
Purchaser shall be responsible for all Violations from and after the Closing
Date. (b) If, after the expiration of Purchaser's Due Diligence Period, any
Violations are imposed which require a cost in excess of $100,000, in the
aggregate, to cure as determined by a reputable contractor or engineer selected
by Seller (and reasonably acceptable to Purchaser) Seller shall, at its election
(i) cure such Violations and, for such purpose, be entitled to adjourn the
Closing for a period not to exceed sixty (60) days or (ii) allow Purchaser a
credit against the Purchase Price equal to the sum required to cure such
Violations less $100,000 or (iii) if Seller reasonably disputes the validity of
such Violations, indemnify Purchaser from and against any and all claims, loss,
liability or damage, which exceed $100,000, that may arise as a result of such
Violations, Seller's liability being limited under such indemnity to $100,000 in
the aggregate. (c) The provisions of this Section 8 shall survive the Closing.
9. PENDING TAX PROCEEDINGS. Seller represents that there are
no proceedings to review real estate tax assessment of the Premises other than
as set forth in Schedule F. Seller shall have sole authority to prosecute,
settle and withdraw proceedings to review any real estate tax assessment for the
Premises for period relating to tax years prior to, and including, the year in
which the Closing occurs. Purchaser and Seller agree that if there should be a
refund of any real estate taxes paid by Seller in respect of the fiscal year in
which the Closing occurs, such refund, less reasonable attorneys' fees and
disbursements, shall be apportioned between Seller and Purchaser as of the
Closing Date and shall be paid promptly upon receipt thereof. Seller and
Purchaser shall pay their respective share of any amounts reimbursable to Space
Tenants in respect to such refund. Purchaser acknowledges that it has no
interest in any proceedings or refunds applicable to any fiscal tax year prior
to
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the year in which the Closing occurs. The provisions of this Section 9 shall
survive the Closing.
10. "AS-IS". Purchaser represents to Seller that (i) Purchaser
has or will, prior to the expiration of the Purchaser's Due Diligence Period,
independently examined, inspected, and investigated to the full satisfaction of
Purchaser, the physical nature and condition of the Premises and the income,
operating expenses and carrying charges affecting the Premises, (ii) except as
expressly set forth in this Contract, neither Seller nor any agent, officer,
employee, or representative of Seller has made any representation whatsoever
regarding the subject matter of this Contract or any part thereof, including
(without limiting the generality of the foregoing) representations as to the
physical nature or condition of the Premises, the existence or non-existence of
asbestos, hazardous substances or wastes, underground storage tanks or any other
environmental hazards on or about the Premises, or the Space Leases, or
operating expenses or carrying charges affecting the Premises, and (iii)
Purchaser, in executing, delivering and performing this Contract, does not rely
upon any statement, offering material, operating statement, historical budget,
engineering structural report, any environmental reports, information, or
representation to whomsoever made or given, whether to Purchaser or others, and
whether directly or indirectly, verbally or in writing, made by any person, firm
or corporation except as expressly set forth herein, and Purchaser acknowledges
that any such statement, information, offering material, operating statement,
historical budget, report or representation, if any, does not represent or
guarantee future performance of the Premises. Without limiting the foregoing,
but in addition thereto, except as otherwise expressly set forth in this
Contract, Seller shall deliver, and Purchaser shall take, the Premises in their
"as is" condition on the Closing Date subject to Section 12.
11. BROKER. Seller and Purchaser represent to each other that
neither party has dealt with any broker or real estate consultant in connection
with the transactions contemplated by this Contract. Seller and Purchaser shall
indemnify and hold the other free and harmless from and against any damages,
costs or expenses (including, but not limited to, reasonable attorneys' fees and
disbursements) suffered by the indemnified party arising from a
misrepresentation or a breach of any covenant made by the indemnifying party
pursuant to this Section 11. The provisions of this Section 11 shall survive the
Closing.
12. DESTRUCTION OR CONDEMNATION. (a) If on or prior to the
date set for Closing there is a casualty or condemnation affecting the Property
which constitutes a Substantial Loss, Purchaser shall have the option of
cancelling this Contract within fifteen (15) days after notice of such casualty
or condemnation, in which event, the Deposit shall be returned to the Purchaser
and this Contract deemed cancelled and of no force and effect and neither party
shall have any further rights or liabilities against or to the other. In the
event of a Substantial Loss, and Purchaser does not elect to cancel this
Contract, or in the event that the casualty or condemnation does not constitute
a Substantial Loss, then the Purchaser and Seller shall consummate the
transaction contemplated by this Contract without any reduction or abatement in
the Purchase Price and Seller, upon the Closing, shall assign to the Purchaser
all of its rights in and to any insurance proceeds (and shall pay to Purchaser,
or allow on account the Purchase Price, a sum equal to the amount of the
deductible, if any, on
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Seller's casualty insurance policy for the Premises) or condemnation awards, as
the case may be, in connection with such casualty or condemnation.
(b) As used herein, "Substantial Loss" with respect to the
Property shall mean a casualty or condemnation that either (i) shall entitle any
anchor Space Tenant denoted as such on Schedule C annexed hereto (each an
"Anchor Space Tenant" and collectively the "Anchor Space Tenants") to terminate
its Space Lease on or after the Closing Date and Seller has failed to obtain a
waiver of such termination right or (ii) requires repairs or restoration costs
in excess of Seven Hundred Fifty Thousand ($750,000.00) Dollars. In the event
Purchaser elects to cancel this Contract in accordance with subparagraph (a)
above, Seller may rescind such cancellation by (iii) delivering, within one (1)
year after the receipt of Purchaser's notice of cancellation, a waiver by each
Anchor Space Tenant which was entitled to terminate its Space Lease by reason of
the casualty or condemnation of its right or option to so terminate and (iv)
within one (1) year after receipt of Purchaser's notice of cancellation,
restorating and repairing the Property (A) if in connection with a casualty,
substantially to its condition immediately prior to the casualty or (B) if in
connection with a condemnation, as may be reasonably necessary as a result of
the taking of property; provided, however, that Purchaser shall have no
obligation to close title if, during such period of adjournment, an event occurs
which materially and adversely affects the Premises and such event is not
corrected or cured to the reasonable satisfaction of Purchaser.
(c) The estimated cost of repairs or restoration in
connection with a casualty or condemnation shall be determined by a reputable
contractor or engineer selected by Seller and approved by Purchaser (which
approval shall not be unreasonably withheld or delayed). The Closing shall be
postponed for such periods as may be necessary to allow Seller to comply with
the provisions of this Section 12.
(d) The provisions of this Section 12 supersede the
provisions of any applicable statutory or decisional law with respect to the
subject matter contained in this Section 12.
13. STATUS OF TITLE. Seller shall deliver and Purchaser shall
accept title to the Premises and consummate the transaction contemplated by this
Contract subject to (a) the title exceptions set forth in Schedule B, (b) the
Existing Mortgage, (c) title exceptions created or suffered by the Space Tenants
or Purchaser and (d) such other title exceptions which Seller may, in accordance
with the provisions of this Contract, cause the Title Company to omit or
affirmatively insure will not be collected out of the Premises provided that
Purchaser has reasonably approved the affirmative insurance (the title
exceptions, whether liens, encumbrances, defects, encroachments or other
objections, described in (a), (b), (c) and (d) being sometimes referred to
collectively as "Permitted Exceptions"). Seller shall not enter into any
agreements, indemnities or other understandings with the Title Company which
will enable the Title Company to omit any matter of record without the knowledge
of Purchaser.
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14. CLOSING.
(a) The closing of title (the "Closing") shall take place
on September 30, 1997 (the actual date of Closing being herein referred to as
the "Closing Date") at the offices of Xxxxxx Xxxxxxxxxx LLP, 000 Xxxxxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 at 9:00 o'clock in the forenoon on that day,
time being of the essence (except that Seller may adjourn the Closing in
accordance with other express provisions of this Contract,) at which time the
Deed to the Property shall be delivered upon payment to Seller of the Purchase
Price. Notwithstanding anything contained herein or at law or in equity,
Purchaser expressly agrees that it shall have no right or privilege to adjourn
the Closing except as expressly permitted by this Contract and Purchaser's
inability or refusal to close title on the date scheduled for Closing shall be a
default under this Contract.
(b) The parties agree to finalize documents necessary for
the Closing and to cause their representatives to attend a customary
"pre-closing" at least one (1) business day prior to the date scheduled for
Closing.
15. NOTICES. All notices hereunder shall be sent by certified
or registered mail, return receipt requested, or may be sent by Federal Express
or other overnight courier which obtains a signature upon delivery, or may be
delivered by hand delivery addressed to Seller at the address set forth above or
at such other address as Seller shall designate from time to time by notice to
Purchaser with copies of all such notices to be likewise sent to:
Xxxxxx Xxxxxxxxxx LLP
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxxx, Esq.
and to Purchaser at the address given for Purchaser at the beginning of this
Contract or at such other address as Purchaser shall from time to time designate
by notice to Seller with copies of all such notices to Purchaser to be likewise
sent to:
Honigman, Miller, Xxxxxxxx & Xxxx
0000 Xxxxx Xxxxxxxx Xxxxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxx Xxxxxxx, Esq.
Notices shall be deemed served three (3) business days after mailing, and in the
case of overnight courier or hand delivery, on the date actually delivered to
the intended recipient, except for notice(s) which advise the other party of a
change of address of the party sending such notice or of such party's attorney,
which notice shall not be deemed served until actually received by the party to
whom such notice is addressed or delivery is refused by such party. Notices on
behalf of the respective parties may be given by their attorneys and such
notices shall have the same effect as if in fact subscribed by the party on
whose behalf it is given. Notwithstanding the foregoing provisions of this
Section 15, notices served by
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hand delivery shall be deemed served on the date of delivery if delivered at or
prior to 5:00 P.M., and on the next business day if delivered after 5:00 P.M.
16. FRANCHISE TAXES. Unpaid franchise or corporation taxes,
dissolution taxes or any other similar taxes so levied, of any corporation in
the chain of title shall be no objection to title so long as the Title Company
insures against collection of any such taxes out of or enforcement against the
Premises without special or additional premium or if such special or additional
premium is required, if Seller shall pay such special or additional premium.
17. TITLE REPORT. Purchaser shall promptly order a title
report from Commonwealth Land Title Insurance Company (the "Title Company") and
a survey or survey update, all at Purchaser's sole cost and expense. Purchaser
shall from time to time, promptly after obtaining knowledge thereof, notify
Seller of any Non-Permitted Title Objections. Purchaser shall pay all premiums
charged in connection with procuring a policy of title insurance.
18. NON-PERMITTED TITLE OBJECTIONS.
(a) If on the Closing it should appear that the Premises
are affected by any lien, encumbrance, defect, encroachment or objection which
is not a Permitted Exception (collectively, "Non-Permitted Title Objections"),
then in such event, Seller, at Seller's election, shall have the privilege to
remove or satisfy the same, and shall, for that purpose, be entitled to one or
more adjournments of the Closing for a period not exceeding in the aggregate
sixty (60) days.
(b) If Seller elects to adjourn the Closing pursuant to
this Section 18, this Contract shall remain in effect for the period or periods
of adjournment, in accordance with its terms.
(c) Except as provided below, Seller shall not be required
to bring any action or proceeding or to otherwise incur any expense to remove or
discharge any NonPermitted Title Objection; provided, however, that if there
exists Non-Permitted Title Objection(s) which can be removed or discharged by
payment of a sum of money only, and if both (1) such removal or discharge can
reasonably be expected to be accomplished within a period of sixty (60) days and
(2) the sum of money required to accomplish all such removals or discharges with
respect to the Premises shall not exceed in the aggregate Two Hundred Fifty
Thousand and 00/100 ($250,000.00) Dollars (the "Maximum Title Expense"), then,
and in such event, Seller agrees to either (i) adjourn the Closing for the
period required to remove or discharge such Non-Permitted Title Objections, and
to expend an amount not to exceed the Maximum Title Expense to remove or
discharge such Non-Permitted Title Objections, or (ii) indemnify Purchaser, in
an amount not to exceed the Maximum Title Expense, from any damage, cost,
expense or claim which Purchaser may incur as a result of such Non-Permitted
Title Objection (in which case Purchaser shall accept title subject to such
Non-Permitted Title Objection). Notwithstanding the foregoing provisions,
Purchaser may, at any time, accept such title as Seller can convey
notwithstanding the existence of any Xxx-
00
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Permitted Title Objections without reduction of the Purchase Price or any credit
or allowance on account thereof or any claim against Seller, provided, however,
if there shall be any NonPermitted Title Objections that can be removed or
discharged by the payment of a sum of money only which exceeds the Maximum Title
Expense, or that can be removed by the payment of less than the Maximum Title
Expense but not within the available time, and Seller elects not to or cannot
remove or discharge such Non-Permitted Title Objections within the available
time, then if Purchaser elects to accept such title as Seller can convey the
Purchase Price shall be reduced, by the lesser of the Maximum Title Expense or
the amount required to remove or discharge said Non-Permitted Title Objection.
The acceptance of the Deed by Purchaser shall be deemed to be a full performance
and discharge of every agreement and obligation on the part of Seller to be
performed pursuant to this Contract, except those, if any, that are herein
specifically stated or made to survive the Closing (but, except as expressly set
forth in this Contract, nothing herein shall be deemed to obligate Purchaser to
accept title subject to any Non-Permitted Title Objection). Anything in this
Section 18(c) to the contrary notwithstanding, an attempt by Seller to remove or
discharge any Non-Permitted Title Objection shall not be deemed to be or create
an obligation of Seller to remove or discharge the same.
(d) The foregoing provisions of this Section 18 to the
contrary notwithstanding, Seller agrees to remove or discharge any monetary lien
voluntarily created or suffered by Seller and any Non-Permitted Title Objections
voluntarily created or suffered by Seller after the date hereof; provided,
however, that Seller shall not be deemed to have voluntarily created or suffered
(nor shall Seller be liable for) any Non-Permitted Title Objections if caused or
created by an act or omission of Purchaser or by an act or omission of any Space
Tenant. Seller shall remove or discharge any Non-Permitted Title Objection in
the manner set forth in subparagraph (c) above, but, for purposes of this
subparagraph (d), without regard to the Maximum Title Expense.
19. RETURN OF DEPOSIT; SELLER'S DEFAULT
If, for any reason whatsoever, Seller shall be unable to
convey title subject to and in accordance with the terms of this Contract, the
sole obligation of Seller shall be to cause the refund of the Deposit, and upon
the making of such refund this Contract shall be null and void and of no further
force or effect, no party hereto shall have any further claim against the other
by reason of this Contract; provided, however, that if Seller's inability to
convey shall result from (i) Seller's willful default or (ii) Seller's default
under Section 18 above, then Purchaser shall, in either case under clause (i) or
(ii) of this proviso, be entitled to the remedy of either (A) specific
performance or (B) cancelling this Contract and receiving (1) the return of the
Deposit and (2) reimbursement of Purchaser's actual out-of-pocket expenses
incurred in procuring environmental and engineering reports not to exceed
$6,500.00 in the aggregate, and upon receipt by Purchaser of the Deposit and
such reimbursement no party hereto shall have any further claim against the
other by reason of this Contract.
20. AFFIDAVIT REGARDING JUDGMENTS. If a search of the
title discloses judgments, bankruptcies or other returns against other persons
having names the same as or
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similar to that of Seller but who are not Seller or its affiliates or
subsidiaries, Seller will deliver to Purchaser and the Title Company an
affidavit(s) showing that such judgments, bankruptcies or other returns are not
against Seller or, at Seller's option, deliver an indemnity agreement to the
Title Company, in such form and content that the Title Company will remove such
judgments, bankruptcies or other returns as exceptions to title or will insure
against collection of such judgments out of the Premises.
21. ASSIGNMENT OF THIS CONTRACT. This Contract may not be
assigned by Purchaser without the prior written consent of Seller. The foregoing
notwithstanding, Purchaser shall have the right to assign this Contract to an
entity whose decisions are made by Purchaser (or by an entity wholly owned by
Purchaser) provided Purchaser owns at least fifty (50%) percent of the economic
interests in such entity and provided further that such entity assumes all
obligations of Purchaser under this Contract. A transfer, sale or assignment of
the majority stock or membership interest in a corporate or limited liability
company purchaser or in a corporate or limited liability general partner of a
partnership purchaser, or of a general partnership interest in a partnership
purchaser, shall constitute an assignment of this Contract, which assignment or
attempted assignment shall be void if made without the written consent of
Seller. No assignment of this Contract, whether or not permitted, shall be
deemed to relieve or release Purchaser from any of its obligations (whether to
be performed prior to or after Closing) set forth herein. Seller shall not have
the right to assign its interests under this Contract except to entities
affiliated with or related to Seller.
22. DEED; TRANSFER TAXES; EXISTING MORTGAGE EXPENSES
(a) The deed to the Premises shall be the usual special
warranty deed (the "Deed") all in proper statutory form for recording and shall
be duly executed and acknowledged so as to convey to Purchaser the fee simple of
the portion of the Premises covered thereby, free of all liens and encumbrances,
except as herein stated.
(b) At the Closing, Seller shall pay the cost of any
amount of documentary stamps, transfer tax or similar conveyance tax imposed in
connection with the delivery of the Deed (collectively, the "Transfer Tax") and
Purchaser and Seller shall execute and deliver any returns and/or affidavits in
connection with the recording of the Deed or the payment of the Transfer Tax.
(c) (i) Anything in subdivision (b) to the contrary
notwithstanding, Seller may, at its option, elect by notice given not later than
three (3) business days prior to the Closing that Purchaser pay all required
Transfer Tax, in which event at the Closing, Purchaser shall receive a credit
against Purchase Price in the amount paid by Purchaser.
(ii) Purchaser hereby indemnifies and holds Seller
harmless from and against any interest or penalty charges imposed by reason of
the untimely delivery to the appropriate recording officer of any of the checks
required under Subdivision (c)(i).
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(d) At the Closing, Purchaser shall pay the cost of
any documentary stamps, recording taxes or other tax or expense imposed in
connection with the Existing Mortgage.
(e) The provisions of this Section 22 shall survive
the Closing.
23. PURCHASER'S DEFAULT. In the event Purchaser should
default under this Contract (including, but not limited to, Purchaser's failure
to timely deliver the Additional Deposit), the parties agree that the damages
that Seller will sustain as a result thereof will be difficult, if not
impossible, to ascertain and, in such event Seller shall, as its sole and
exclusive remedy, direct Escrowee to pay the Deposit to Seller who shall retain
it as and for its liquidated damages hereunder.
24. ESCROW OF DEPOSIT. With respect to the Deposit,
Escrowee is instructed as follows:
(a) Upon the Closing, the Cash Deposit shall be paid
over to Seller and any Letter of Credit shall be delivered to Purchaser upon
payment by Purchaser to Seller of the Purchase Price.
(b) (i) Escrowee shall draw the full proceeds under
any Letter of Credit if (A) Escrowee shall receive a written statement signed by
Seller as follows: "Purchaser has defaulted in its obligations under that
certain Contract of Sale dated July 7, 1997"; or (B) the Letter of Credit will
expire by its terms within thirty (30) days. Escrowee shall promptly upon
receipt forward a copy of Seller's statement to Purchaser. Any such proceeds
paid to and received by Escrowee shall be treated and disposed of hereunder as
Cash Deposit.
(ii) In the event Purchaser should default under
this Contract, Escrowee shall, if directed by Seller, pay the Cash Deposit to
Seller who shall retain it as and for its liquidated damages hereunder.
(c) In the event Seller shall fail to close title by
reason of a default by Seller or in the event this Contract is terminated in
accordance with its terms through no fault of Purchaser, the Deposit shall be
paid over to Purchaser.
(d) Escrowee shall invest the proceeds of the Deposit
in such bank or money market accounts or United States Government Treasury Bills
as Seller shall direct. Any interest earned on Deposit when received shall
similarly be held in escrow by the Escrowee and if under the terms of this
Contract (i) the Deposit is to be paid over to Purchaser, then such interest
shall be paid over to Purchaser, or (ii) the Deposit is to be paid over to
Seller, then such interest shall be paid over to Seller. If the Closing occurs,
any interest earned on the Deposit shall be considered a credit of Purchaser to
be applied against the Purchase Price.
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(e) Escrowee, by signing this Contract at the end
hereof where indicated, signifies its agreement to hold the Deposit for the
purposes as provided in this Contract. In the event of any dispute, Escrowee
shall have the right to deposit the Deposit in court to await the resolution of
such dispute. In any event, Escrowee shall not be personally liable so long as
it acts in good faith.
(f) Escrowee shall not incur any liability by reason
of any action or non-action taken by Escrowee in good faith or pursuant to the
judgment or order of a court of competent jurisdiction. Escrowee shall have the
right to rely upon the genuineness of all certificates, notices and instruments
delivered to it pursuant hereto, and all the signatures thereto or to any other
writing received by Escrowee purporting to be signed by any party hereto, and
upon the truth of the contents thereof. Before making payment or delivery of any
moneys or documents held by Escrowee pursuant hereto, Escrowee shall have the
right to require delivery to it of an executed and acknowledged receipt for the
subject matter of the delivery to be made by it. In the event of any dispute
between the parties as to whether either party is in default hereunder or as to
any other material fact, Escrowee shall have the right to refrain from taking
any further action with respect to the subject matter of the escrow until it is
reasonably satisfied that such dispute is resolved or action by Escrowee is
required by an order or judgment of a court of competent jurisdiction. Escrowee
shall be entitled to consult with other counsel in connection with its duties
hereunder. Seller and Purchaser jointly and severally, agree to indemnify
Escrowee from any and all liability that may arise hereunder and to reimburse
Escrowee for its reasonable costs and expenses, including reasonable attorneys'
fees (either paid to retained attorneys or representing the fair value of legal
services rendered by Escrowee to itself) incurred as a result of any dispute or
litigation arising hereunder.
(g) Escrowee or any member of its firm shall be
permitted to act as counsel for Seller in any dispute as to the disbursement of
the Deposit or any other dispute between the parties whether or not Escrowee is
in possession of the Deposit and continues to act as Escrowee.
25. REPRESENTATIONS.
(a) Seller, represents that, unless otherwise
herein stated, as of the date hereof:
(i) Schedule C represents a true, accurate
and complete list in all material respects of (A) all Space Tenants; (B) the
current base rent and (C) the security deposits presently held by Seller. Other
than the Space Tenants (and parties claiming rights under Space Leases,
including sublessees, licensees, assignees and concessionees) no party has any
right to possess or use the Premises except as may be contemplated by the
Permitted Exceptions.
(ii) Except as set forth on Schedule C
hereof, the Spaces Leases are in full force and effect. Seller has not received
notice of any unfulfilled obligations as to security deposits to prior tenants.
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(iii) Except as set forth on Schedule C,
Seller has not received rents from the Space Tenants (other than security
deposits) in excess of one (1) month in advance.
(iv) There are no written service contracts
or management agreements (the "Service Contracts") affecting the Premises or the
operation or use thereof which will be binding upon Purchaser after the Closing
except those which may be cancelled upon not more than thirty (30) days notice.
(v) There is no litigation pending (A)
between Seller, as landlord, under the Space Leases and any Space Tenant, except
as may be covered by insurance, or (B) affecting title to the Premises or this
Contract.
(vi) Seller is, and at the Closing shall be
a duly organized and validly existing Alabama corporation and authorized to do
business in the state where the Property is located. The execution, delivery and
performance of this Contract in accordance with its terms, has been duly
authorized by all necessary action of Seller, does not violate the articles of
incorporation, by-laws, operating agreement, partnership agreement or
certificate of partnership of Seller, or any contract, agreement, commitment,
order, judgment or decree to which Seller is a party or by which it, or the
Premises, are bound, or result in the creation of any lien, charge or
encumbrance upon the Premises or any part thereof. This Contract has been duly
executed by Seller and constitutes legal, valid and binding obligations of
Seller. Seller will have the right, power and authority to make and perform its
obligations under this Contract without the need for governmental approval,
consent or filing and this Contract shall be a valid and binding obligation of
Seller enforceable against Seller in accordance with its terms.
(vii) Seller is not a "foreign person"
within the meaning of Section 1445 of the Internal Revenue Code of 1986, as
amended (the "Code").
(viii) Seller has not received written
notice of any condemnation proceedings, eminent domain proceedings, proceedings
to change the zoning or similar actions or proceedings which are pending against
the Premises or any part thereof.
(ix) There are no employees of Seller at the
Properties for which Purchaser shall be responsible after the Closing.
(x) The principal balance as of June 30,
1997 of the Existing Mortgage is set forth on Schedule E attached hereto. The
Lender is not holding escrow deposits other than any deposits for real estate
taxes and/or insurance.
(xi) The Loan Documents constitute all the
documents which are material in connection with the Existing Mortgage. Seller
shall not modify the Loan Documents during the term of this Contract without the
consent of Purchaser or voluntarily and knowingly cause a monetary or other
material default under the Loan Documents which is not cured within any
applicable grace period.
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(xii) Neither Seller nor any of its
affiliates as described in Sections 414(b), (c) and (m) of the Code
("Affiliates") has incurred any liability which could subject Purchaser or any
asset to be acquired by Purchaser pursuant to this Contract to any lien or
material liability under Section 302(f), 4062, 4063, 4064, 4201 or 4301(b) of
ERISA or Section 401(a)(29) or 412 of the Code.
(b) As used herein items in the "possession" of
Seller or "received" by Seller shall mean only writings actually delivered into
the possession of Seller (at the New York City office of DRA Advisors, Inc.) and
shall not include writings addressed to Seller but sent or delivered to the
Space Tenants or other third parties or to other locations.
(c) The representations contained in subsection (a)
above shall survive for a period of six (6) months following the Closing Date,
and any claim by Purchaser in connection therewith must be made within such six
(6) month period. Notwithstanding anything to the contrary, any representation
which results in a reduction of the Purchase Price pursuant to subparagraph (e)
below shall not survive the Closing.
(d) Subject to the succeeding provisions of this
subparagraph (d) and of subparagraph (e) below, if any representation of Seller
shall fail to be true, Purchaser's sole remedy (prior to the Closing) shall be
to terminate this Contract and receive the return of the Deposit, and upon the
receipt of same this Contract shall be null and void and of no further force or
effect and neither party shall have any rights or obligations against or to the
other. Seller shall, in any event, have the option (i) to rescind Purchaser's
termination of the Contract and adjourn the Closing for a period not to exceed
sixty (60) days in order to make such representation true, or (ii) unless
Purchaser waives all liability of Seller by reason of such untrue
representation, to terminate this Contract and promptly return the Deposit to
Purchaser, and upon the making of such return this Contract shall be null and
void and of no further force or effect and neither party hereto shall have any
rights or obligations against or to the other. If Purchaser waives such
liability, then in such event, the Closing shall take place without abatement or
reduction in the Purchase Price. If the Closing shall take place without
Purchaser making an objection (by notice delivered at the Closing) to an untrue
representation of which Purchaser shall have knowledge, Purchaser shall be
deemed to have waived all liability of Seller by reason of such untrue
representation. The untruth of any non-material representation of Seller shall
not affect the rights and obligations of the parties hereto.
(e) The provisions of subparagraph (d) hereof to the
contrary notwithstanding, if any representations shall fail to be true and such
representations can be made true by the payment of a sum of money only, and if
both (i) such representation(s) can reasonably be expected to be made true
within a period of sixty (60) days and (ii) the sum of money requited to make
such representation(s) true shall not exceed Two Hundred Fifty Thousand and
00/100 ($250,000.00) Dollars in the aggregate (the "Maximum Representation
Expense"), then, and in such event, Seller agrees to (i) adjourn the Closing for
the period required to make such representations true and to expend (or, at
Seller's election, to obligate itself to expend by indemnity agreement, bond or
any other manner) an amount not to exceed the Maximum Representation Expense, or
(ii) indemnify Purchaser, in an amount not to
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exceed the Maximum Representation Expense, from any damage, cost, expense or
claim that Purchaser may incur as a result of such untrue representation.
Notwithstanding the provisions of the preceding sentence, Purchaser may at any
time accept such title as Seller can convey notwithstanding the existence of any
such untrue material representation(s) without reduction of the Purchase Price
or any credit or allowance on account thereof or any claim against Seller;
provided, however, if there shall be any untrue material representation(s) which
can be made true by the payment of a sum of money only which exceeds the Maximum
Representation Expense or which can be made true by the payment of less than the
Maximum Representation Expense but not within the available time and Seller
elects not to, or cannot, make such material representation(s) true within the
available time, then if Purchaser elects to accept such title as Seller can
convey, the Purchase Price shall be reduced by the lesser of the sum of money
required to make such representations true, or the Maximum Representation
Expense. The acceptance of the Deeds by Purchaser shall be deemed to be a full
performance and discharge of every agreement and obligation on the part of the
Seller to be performed pursuant to the provisions of this Contract, except
those, if any, which are herein specifically stated or made to survive the
Closing and Seller shall have no further liability with respect to such untrue
material representation(s).
(f) Following the Closing, Seller agrees to maintain
at least $50,000.00 in its operating account until the end of the calendar year
in which the Closing occurs, it being understood that such amount shall not be
deemed to be the limit of Seller's liability, if any, after the Closing Date.
26. CLOSING DOCUMENTS. At the Closing (unless otherwise
expressly indicated):
(a) Seller shall deliver to Purchaser the following
items:
(i) the Deed in accordance with Section 22
hereof.
(ii) the Assignment of Space Leases executed by
Seller, which assignment shall be in the form of Exhibit 1 attached hereto.
(iii) duplicate originals, or if duplicate
originals are not available, true and complete copies certified as true by
Seller, of all of the Space Leases.
(iv) to the extent in Seller's possession, the
real estate tax bills then payable for the then current real estate tax year.
(v) a duly executed certificate of Seller, in
the applicable form set forth in Treasury Regulations Section 1.1445-2(b)(2).
(vi) the checks, return and/or affidavit in
accordance with Section 22 hereof.
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(vii) subject to the terms of Sections
26(a)(vii)(A)(B) and (C), below, at least three (3) business days prior to the
Closing Date, estoppel certificates ("Estoppel Certificates"), in form and
substance which does not vary materially from the form annexed hereto as Exhibit
2 executed by each of the Space Tenants; provided, however, with respect to
Anchor Space Tenants, Seller shall only be required to deliver such Estoppel
Certificates which are usual and customary for such Anchor Space Tenants (except
that, other than for the Estoppel Certificate to be delivered by Wal-Mart
Stores, Inc. [or its assignee] the Estoppel Certificates of all other Anchor
Space Tenants shall cover at least the matters set forth in paragraphs 2 and 3
of Exhibit 2).
(A) If the required Estoppel Certificates
cannot be timely delivered, or if the Estoppel Certificates which are timely
delivered do not cover the material applicable matters set forth in Exhibit 2
Seller may, but shall not be obligated to, adjourn the Closing for a period not
to exceed sixty (60) days, to obtain satisfactory Estoppel Certificates, or
deliver its certificate ("Seller's Certificate") with respect to not more than
forty (40%) percent of rentable square feet of space leased by non-Anchor Space
Tenants as of the date hereof, covering all of the matters set forth in Exhibit
2 if no Estoppel Certificate is delivered by a Space Tenant or covering the
matters not covered by an Estoppel Certificate which is delivered by a Space
Tenant. Subsequent to the Closing, Seller may deliver to Purchaser Estoppel
Certificates or supplemental Estoppel Certificates covering those matters not
covered by the previously delivered Estoppel Certificates. Upon delivery of such
Estoppel Certificates, Seller shall be entirely released from any liability
arising out of Seller's Certificate delivered at the Closing as Seller's
Certificate relates to the particular Space Tenant and/or Space Lease covered by
the Estoppel Certificate, to the extent the information contained in such
Estoppel Certificates is consistent with the information contained in Seller's
Certificate. If Seller does not or cannot deliver an Estoppel Certificate or
Seller's Certificate, Purchaser's sole remedy shall be to terminate this
Contract and receive the return of the Deposit or to close title notwithstanding
the lack of the Estoppel Certificate or Seller's Certificate without any
reduction of the Purchase Price and without any liability of Seller relative
thereto.
(B) (1) In the event any Estoppel
Certificate or Seller's Certificate shall indicate a default by landlord under a
Space Lease (such default hereinafter being referred to as an "Estoppel
Default"), then Seller may, but shall not be obligated to, elect to cure any
such Estoppel Default and shall, for that purpose, be entitled to adjourn the
Closing for a period not to exceed sixty (60) days, provided, however, that in
the event Seller elects not to cure such Estoppel Default or is unable to cure
such Estoppel Default within such period of time, Purchaser's sole remedy shall
be as set forth in the last sentence of subparagraph (A) above.
(2) Notwithstanding subsection
26(a)(vii)(B)(1), above, if, in Seller's good faith judgment either (x) the
potential liability of any Estoppel Default is less than $250,000, and Seller
indemnifies Purchaser from and against any and all claims, loss, liability,
damage, cost or expense, including reasonable attorneys' fees, that may arise as
a result of such Estoppel Default or (y) the potential liability of any Estoppel
Default is $250,000 or more and Seller and Purchaser agree upon a
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mutually acceptable resolution to such Estoppel Default, then, the rights and
obligations of the parties hereto shall not be affected thereby, this Contract
shall remain in full force and effect and Purchaser shall, at the Closing,
accept such Estoppel Certificate or Seller's Certificate, and the Space Lease
corresponding thereto, subject to such Estoppel Default without any reduction of
the Purchase Price. Subsequent to the Closing, Seller may deliver an Estoppel
Certificate confirming that the Estoppel Default no longer exists, whereupon
Seller shall be entirely released from any liability arising out of the
indemnity, if any, given pursuant to clause (x) above.
(viii) to the extent then in Seller's
possession and control, copies of plans and specifications relating to the
Property.
(ix) a xxxx of sale without representation
or warranty for any personal property (including tradenames and warranties, if
any) being conveyed pursuant to this Contract;
(x) the Assignment of Service Contracts
existing on the Closing Date executed by Seller, which assignment shall be in
the form of Exhibit 3 attached hereto; and
(xi) a title certification substantially in
the form of Exhibit 5 attached hereto.
(b) Purchaser shall (i) pay to Seller or as Seller
may direct, the Purchase Price as provided in Section 3 hereof, (ii) pay all
Mortgage Expenses and (iii) deliver the Lender's release of the Obligors (and
their partners, members, officers and/or shareholders) from any and all
obligations and liabilities under the Loan Documents in accordance with Section
4(b). Escrowee shall deliver the Cash Deposit to Seller.
(c) Purchaser shall execute, acknowledge (where
required) and deliver to Seller:
(i) the Assignment of the Space Leases.
(ii) the Assignment of the Service Contracts.
(iii) the checks, returns and/or affidavits in
accordance with Section 22 hereof.
(iv) a copy, certified as true and complete by
Purchaser, of the Consent and Assumption Agreement in accordance with Section
4(b).
(d) Seller and Purchaser shall execute a notice to
each of the Space Tenants stating in substance that Purchaser has succeeded to
Seller's interest as landlord under the Space Leases.
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27. FURTHER ASSURANCES. The parties each agree to do such
other and further acts and things, and to execute and deliver such instruments
and documents (not creating any obligations additional to those otherwise
imposed by this Contract), as either may reasonably request from time to time,
whether at or after the Closing, in furtherance of the purposes of this
Contract. The provisions of this Section 27 shall survive the Closing.
28. PURCHASER'S DUE DILIGENCE PERIOD.
(a) Purchaser shall have the right to cancel this
Contract on or before September 5, 1997 by notice to Seller and Escrowee of such
cancellation to be received by Seller on or before such date (the period of time
from the date hereof through and including September 5, 1997 is herein referred
to as "Purchaser's Due Diligence Period"). If Purchaser duly cancels this
Contract in accordance with this subparagraph, this Contract shall be deemed
terminated and of no further force or effect and the Deposit shall be promptly
returned to Purchaser. If Purchaser does not duly cancel this Contract in
accordance with this subparagraph or if Purchaser waives its right to cancel
this Contract, (i) this Contract shall remain in full force and effect and
Purchaser shall have no further right to cancel this Contract under this
subparagraph and (ii) Purchaser shall be deemed to have waived any liability of
Seller and any right to refuse to consummate the Closing by reason of a
misrepresentation, Non-Permitted Title Objection or other condition known to
Purchaser as of the expiration of Purchaser's Due Diligence Period.
(b) Time shall be of the essence with respect to the
dates in this Section for the expiration of Purchaser's Due Diligence Period and
the giving of Purchaser's cancellation notice.
(c) Notwithstanding anything to the contrary, if
Purchaser's environmental and engineering consultants have not inspected the
Property by August 8, 1997 Seller may elect to cancel this Contract in which
event the Deposit shall be promptly returned to Purchaser. In the event
Purchaser concludes based upon any of its due diligence investigations that it
is not prepared to proceed to Closing it will promptly so notify Seller and
cancel the Contract.
(d) Purchaser agrees to keep confidential as
hereinafter provided all information furnished to Purchaser by Seller concerning
the Premises, including, without limitation, Space Leases, Loan Documents,
Service Contracts or other contracts or agreements, various papers, documents,
legal instruments, studies, brochures, computer output, and other material, and
any discussions or visitations of the Premises (all of the aforementioned
information is collectively referred to as "Evaluation Material").
(e) All Evaluation Material shall not be used or
duplicated by Purchaser in any way detrimental to Seller, or for any purpose
other than evaluating a possible purchase of the Property by Purchaser.
Purchaser agrees to keep all Evaluation Material (other than information which
is a matter of public record or is provided in other sources readily available
to the public other than as a result of disclosure thereof by Purchaser or
Related Parties) strictly confidential; provided, however, that the Evaluation
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Material may be disclosed to the directors, officers, and employees and partners
of Purchaser, and to Purchaser's attorneys and accounting firm, other
consultants, underwriters and financial institutions (all of whom are
collectively referred to as "Related Parties") who need to know such information
for the purpose of evaluating a possible purchase of the Premises. These Related
Parties shall be informed of the confidential nature of the Evaluation Material
and shall be directed to keep all such information in the strictest confidence
and use such information only for the purpose of evaluating a possible purchase
by Purchaser. Purchaser will promptly, upon request of Seller, deliver to Seller
all Evaluation Material furnished to them by Seller, whether furnished before or
after the date hereof, without retaining copies thereof. Purchaser will direct
Related Parties to whom Evaluation Material is made available not to make
similar disclosures and any such disclosure shall be deemed made by and be the
responsibility of Purchaser.
(f) Purchaser shall have the right to conduct
non-intrusive investigations of the Premises during the term of this Contract
(including a Phase I environmental investigation and a structural analysis).
Such investigations may be conducted by Purchaser or its designees, including,
but not limited to engineers, accountants, architects and Purchaser's employees
during normal business hours and upon reasonable advance notice to Seller
provided there is no disturbance to or interference with the business of any
Space Tenant. Purchaser hereby indemnifies and holds harmless Seller from and
against any claims, costs, damages, liabilities or expenses (including
reasonably attorneys' fees) incurred or, suffered by Seller by reason of damage
or injury to persons or property caused by Purchaser's investigations.
(g) Seller agrees to deliver to Purchaser true and
complete copies of all Space Leases (and any modifications thereof) in Seller's
possession.
(h) The provisions of Section 28(d), (e) and (f)
shall survive the termination of this Contract.
29. ENTITY CONSENTS; PURCHASER'S REPRESENTATIONS.
(a) At the Closing, Seller and Purchaser shall each
deliver any and all appropriate partnership consents or certificates by the
secretary of each corporation (including any corporate general partner)
certifying as to the corporate resolution authorizing this transaction.
(b) Purchaser represents that: (i) it is, and will at
the Closing be, a limited partnership duly organized and validly existing under
the laws of Delaware and qualified to do business in the state in which the
Property is located; (ii) the execution, delivery and performance of this
Contract in accordance with its terms, do not violate the corporate charter,
by-laws or certificate of incorporation of Purchaser, or any contract,
agreement, commitment, order, judgment or decree to which Purchaser is a party
or by which it is bound; (iii) Purchaser has the right, power and authority to
make and perform its obligations under this Contract; (iv) this Contract is a
valid and binding obligation of Purchaser enforceable against Purchaser in
accordance with its terms. Purchaser covenants
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and warrants that the representations in the preceding sentences of this Section
29(b) will be true on the Closing with respect to Purchaser or any permitted
assignee of Purchaser; (v) Purchaser will have the right, power and authority to
make and perform its obligations under this Contract without the need for
governmental approval, consent or filing and this Contract shall be a valid and
binding obligation of Purchaser enforceable against Purchaser in accordance with
its terms and (vi) Purchaser has the current financial ability to pay the
Purchase Price and otherwise perform its obligations under this Contract.
(c) Purchaser represents and warrants that: (i)
Purchaser is not an "employee benefit plan" as defined in Section 3(3) of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"), which is
subject to Title I of ERISA; (ii) the assets of the Purchaser do not constitute
"plan assets" of one or more plans within the meaning of 29 C.F.R. ss.2510-101;
(iii) Purchaser is not a "governmental plan" within the meaning of Section 3(32)
of ERISA; (iv) transactions by or with Purchaser are not subject to state
statutes regulating investments of and fiduciary obligations with respect to
governmental plans; and (v) Purchaser is not a "party in interest" to Seller
within the meaning of ERISA. Purchaser covenants and warrants that the
representations in the preceding sentences of this Section 28(c) will be true on
the Closing.
30. MISCELLANEOUS.
(a) This Contract and the Schedules and Exhibits
annexed hereto constitute the entire agreement between the parties hereto with
respect to the subject matter hereof, and except for any other documents
executed contemporaneously herewith all understandings and agreements heretofore
or simultaneously had between the parties hereto, including without limitation,
any letter of intent or initial escrow agreement, are merged into and are
superseded in their entirety by this Contract.
(b) This Contract may not be waived, changed,
modified or discharged orally, but only by an agreement in writing signed by the
party against which any waiver, change, modification or discharge is sought.
(c) The captions or article titles contained in this
Contract and the Index, if any, are for convenience and reference only and shall
not be deemed a part of the text of this Contract.
(d) The terms "hereof," "herein," and "hereunder,"
and words of similar import, shall be construed to refer to this Contract as a
whole, and not to any particular article or provision, unless expressly so
stated.
(e) The Schedules and Exhibits annexed hereto are
hereby incorporated in and made part of this Contract.
(f) All words or terms used in this Contract,
regardless of the number or gender in which they are used, shall be deemed to
include any other number and any other gender as the context may require.
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(g) This Contract shall be binding upon and shall
inure to the benefit of the parties hereto and their respective heirs,
executors, administrators, successors and permitted assigns, if any, but nothing
contained herein shall be deemed a waiver of the provisions of Section 21
hereof. None of the provisions of this Contract are intended to be, nor shall
they be construed to be, for the benefit of any third party.
(h) If a party is required to perform an act or give
a notice on a date that is a Saturday, Sunday or national holiday, the date such
performance or notice is due shall be deemed to be the next business day.
(i) This Contract is to be governed and construed in
accordance with the laws of the State of New York.
(j) The terms "affiliates" and "subsidiaries" shall
be given the same meaning as used in the broadest sense in any provision of the
rules and regulations governing federal taxation and securities.
(k) Neither Seller nor Purchaser may record this
Contract or a memorandum of this Contract. Purchaser hereby waives, to the
extent permitted by law, any right to file a lis pendens or other form of
attachment against the Properties in connection with this Contract or the
transactions contemplated hereby, other than a lis pendens or other such form of
attachment that may be filed by Purchaser contemporaneously with the
commencement by Purchaser of an action for a specific performance under Section
19 hereof. To the extent any such filing is made in violation of this Contract,
Purchaser shall indemnify Seller against any damages incurred by Seller in
connection therewith. In the event Purchaser shall be unsuccessful in an action
for a specific performance, it shall immediately cause any lis pendens or other
such form of attachment to be cancelled and removed from the public record. The
provisions of this section shall survive the termination of this Contract.
(l) The parties acknowledge that this transaction
contemplates only the sale and purchase of the Premises and that Seller is not
selling a business nor do the parties intend that Purchaser be deemed a
successor of Seller with respect to any liabilities of Seller to any third
parties other than as set forth in this Contract and the Permitted Exceptions.
Accordingly, except as set forth in this Contract, Purchaser shall neither
assume nor be liable for any of the debts, liabilities, taxes or obligations of,
or claims against, Seller, or of any other person or entity, of any kind or
nature, whether existing now, on the Closing Date or at any time thereafter. The
debts, liabilities, taxes, obligations and claims for which Seller alone is
liable shall include, without limitation, all payments, benefits, and
contribution obligations with respect to past and/or present employees of Seller
or its Affiliates in connection with the business of Seller or its Affiliates
(including, but not limited to, salaries, wages, commissions, bonuses, vacation
pay, health and welfare benefits or contributions [including any group health
continuation coverage obligation under COBRA], pension and/or profit sharing
contributions, severance or termination pay, or any other form of compensation
or employee benefit).
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(m) Seller shall operate the Premises in a manner
substantially consistent with its past practice.
[SPACE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Contract the day and year first above written.
SELLER:
Fed ID No.: DRM THIRTY-TWO REALTY CORPORATION, an
Alabama corporation
00-0000000
By /s/ Authorized Signature
---------------------------
Name:
Title:
PURCHASER:
Fed ID No.: RAMCO-XXXXXXXXXX PROPERTIES, L.P.
By: RAMCO-XXXXXXXXXX PROPERTIES
TRUST, a Massachusetts Business Trust
By /s/ Authorized Signature
---------------------------
Name:
Title:
As to Section 24:
ESCROWEE:
XXXXXX XXXXXXXXXX LLP
BY /s/ Authorized Signature
---------------------------
Name:
Title:
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SCHEDULE A:
DESCRIPTION OF PROPERTY
34
SCHEDULE B:
"SUBJECT TO" PROVISIONS
1. Any laws, regulations or ordinances presently in effect or which will
be in effect on the Closing (including, but not limited to, zoning,
building and environment protection) as to the use, occupancy,
subdivision or improvement of this Property adopted or imposed by any
governmental body or the effect of any noncompliance with or any
violation thereof.
2. The Space Leases and the rights of Space Tenants thereunder pertaining
to this Property listed on Schedule C attached to and forming part of
this Contract to which this Schedule is attached as well as any
permitted renewals or extensions thereof and any permitted new leases
created after the date of this Contract as same may be affected by rent
regulations or laws now or hereafter in effect, and rulings, decisions
or interpretations by any court, agency or administrative body.
3. Real estate taxes, vault taxes and water and sewer charges not due and
payable (it being understood that the lien of real estate taxes payable
in arrears shall be a Permitted Exception).
4. State of facts shown on Survey dated , last revised and Survey
dated prepared by and such additional state of facts an
accurate survey of the Premises may show.
5. Maintenance and Service Contracts pertaining to this Premises set forth
on Schedule D to this Contract.
6. Violations of laws, regulations, ordinances, orders or requirements, if
any, noted in or issued by any governmental or quasi-governmental
department or authority having or asserting jurisdiction over the
Premises issued subsequent to the date hereof, and any conditions
constituting such violations, although not so noted or issued.
7. Rights of utility companies to lay, maintain, install, operate and
repair pipes, lines, poles, wires, cables, conduits, cable boxes,
distribution boxes and related equipment on, over and under the
Property.
8. Additional usual and customary exclusions and exceptions from coverage
obtaining in the standard form of insuring agreement employed by the
Title Company at the standard rates of such Title Company.
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SCHEDULE C
RENT ROLL
36
SCHEDULE D
ESCROWEE'S WIRE TRANSFER INSTRUCTIONS
SCHEDULE E
EXISTING MORTGAGE
SCHEDULE F
LIST OF TAX PROTESTS
EXHIBIT 1
FORM OF ASSIGNMENT AND ASSUMPTION OF SPACE LEASE
EXHIBIT 2
FORM OF SPACE TENANT ESTOPPEL CERTIFICATE
EXHIBIT 3
FORM OF ASSIGNMENT OF SERVICE CONTRACTS
EXHIBIT 4
FORM OF LETTER OF CREDIT
EXHIBIT 5
FORM OF TITLE CERTIFICATION
