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CONTRIBUTION AGREEMENT
FOR
NORTHERN TELECOM PROPERTIES,
AMONG
"CONTRIBUTORS"
(AS HEREIN DEFINED)
AND
WEEKS REALTY, L.P.
DOING BUSINESS AS
WEEKS REALTY LIMITED PARTNERSHIP
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TABLE OF CONTENTS
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Page
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1. DEFINED TERMS......................................... 1
2. COVENANT TO CONTRIBUTE................................ 9
3. STRUCTURE OF CONTRIBUTION............................. 9
4. CONTRIBUTION DATE..................................... 10
5. CONTRIBUTION VALUE.................................... 11
6. ADJUSTED CONTRIBUTION VALUE........................... 11
7. CASH PAYMENTS AND ISSUANCE OF UNITS................... 12
8. INTERIM CONDUCT....................................... 13
9. EXISTING LOANS........................................ 14
10. TITLE AND SURVEY...................................... 16
11. DATE, TIME AND PLACE OF CONTRIBUTION.................. 16
12. COSTS AND EXPENSES; PREPARATION OF DOCUMENTS.......... 18
13. ACCESS TO AND EXAMINATION OF THE NORTHERN
TELECOM PROPERTIES.................................... 19
14. REPRESENTATIONS AND WARRANTIES OF
THE CONTRIBUTORS...................................... 19
15. REPRESENTATIONS AND WARRANTIES OF WEEKS............... 28
16. CONDITIONS............................................ 29
17. FIRE AND CASUALTY..................................... 31
18. EMINENT DOMAIN........................................ 32
i
19. DEFAULT............................................... 33
20. BROKERAGE FEES........................................ 33
22. MISCELLANEOUS......................................... 34
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SCHEDULE OF EXHIBITS
EXHIBIT A Northern Telecom Properties
EXHIBIT B Existing Loans
EXHIBIT C Existing Loan Documents
EXHIBIT D Legal Descriptions of Land
EXHIBIT E Leasing Guidelines
EXHIBIT F Permitted Exceptions
EXHIBIT G Pro Forma Annual Operating Expense/Pro Forma Reimbursable
Amounts
EXHIBIT H Rent Roll
EXHIBIT I Tenant Estoppel Certificate Form
EXHIBIT J Schedule of Environmental Reports
EXHIBIT K Schedule of Pending or Threatened Litigation
EXHIBIT L Schedule of Engineering Reports
EXHIBIT M Schedule of Insurance Coverage
EXHIBIT N Schedule of Incomplete Improvements
EXHIBIT O Schedule of Service Contracts
EXHIBIT P Schedule of Commission Obligations
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CONTRIBUTION AGREEMENT
(Northern Telecom Properties)
THIS CONTRIBUTION AGREEMENT (hereinafter referred to as this
"Agreement"), made and entered into as of this 31st day of December, 1996, by
and among the "CONTRIBUTORS" (as hereinafter defined); and WEEKS REALTY, L.P., a
Georgia limited partnership authorized to do business as WEEKS REALTY LIMITED
PARTNERSHIP (hereinafter referred to as "Weeks");
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, pursuant to the "Transaction Documents" (as defined in that
certain Contribution Agreement for Completed Properties, dated of even date
herewith), the Contributors and other contributors identified in the Transaction
Documents have agreed to contribute in stages certain assets, properties and
businesses to the capital of Weeks upon and subject to the terms and conditions
set forth in the Transaction Documents (hereinafter referred to as the
"Transaction");
WHEREAS, on even date herewith, the Contributors and other
contributors identified in the Transaction Documents contributed to the capital
of Weeks (hereinafter referred to as the "Initial Contribution") the "Completed
Properties" (as defined in that certain Contribution Agreement for Completed
Properties, dated as of even date herewith) in exchange for "Units" (as
hereinafter defined), cash and assumption (subject to the limitation on recourse
provisions) of certain indebtedness as one of the stages in the Transaction;
WHEREAS, as another stage of the Transaction, Contributors have agreed
to contribute, from time to time, each of the "Northern Telecom Properties" (as
hereinafter defined) to the capital of Weeks in exchange for the issuance of
additional Units, cash and the assumption (subject to the limitation on recourse
provisions) of certain indebtedness, as and when certain conditions are met, all
as more particularly set forth in this Agreement; and
WHEREAS, Weeks has agreed to accept such contribution of the Northern
Telecom Properties and, in connection therewith, issue Units and pay cash to the
Contributors and assume (subject to the limitations of recourse provisions)
certain liabilities, all as more particularly set forth in this Agreement.
NOW, THEREFORE, for and in consideration of the foregoing premises,
the mutual covenants and agreements herein set forth and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Contributors and Weeks hereby covenant and agree as follows:
1. DEFINED TERMS. In addition to terms defined elsewhere in this
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Agreement, the following words, when used in this Agreement, shall have the
meanings ascribed thereto in this paragraph:
a. "Adjusted Contribution Value" means the adjusted contribution value
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for a Northern Telecom Property arrived at after making the
adjustments provided for in Paragraph 6 of this Agreement.
b. "Contribution" means the consummation of a contribution to the capital
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of Weeks of a Northern Telecom Property pursuant to the terms and
conditions of this Agreement; and "Contribute" means the making of a
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Contribution.
c. "Contribution Date", for each Northern Telecom Property, means the
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date on which that Northern Telecom Property is Contributed by the
Contributors to the capital of Weeks pursuant to Paragraph 4 of this
Agreement.
d. "Contribution Value" means the contribution value of a Northern
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Telecom Property determined in accordance with Paragraph 5 of this
Agreement.
e. "Contributors" means, collectively, X.X. Xxxxxxx, M.A. Xxxxxxxxx and
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PPW; and "Contributor" means any one of the Contributors.
f. "Environmental Laws" means the Resource Conservation and Recovery Act
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(42 U.S.C. (S) 6901 et seq.), as amended by the Hazardous Materials
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Transportation Act (490 U.S.C. (S) 1801 et seq.); the Toxic Substance
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Control Act (15 U.S.C. (S) 2601 et seq.); Clean Air Act U.S.C. (S) 136
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et seq.); the Occupational Safety and Health Act (29 U.S.C. (S) 651 et
-- --- --
seq.) and all applicable federal, state and local environmental laws,
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including obligations under the common law, ordinances, rules and
regulations, as any of the foregoing may have been amended,
supplemented or supplanted prior to the date hereof, relating to
regulation or control of Hazardous Materials, or their handling,
storage or disposal or to environmental health and safety.
g. "Existing Loan" means one of the loans identified on Exhibit B,
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attached hereto and by this reference made a part hereof; and
"Existing Loans" means, collectively, all of the loans identified on
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Exhibit B hereto.
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h. "Existing Loan Documents" means, collectively, all of the loan
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documents evidencing and securing an Existing Loan, as identified on
Exhibit C, attached hereto and by this reference made a part hereof.
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i. "Gross Income", for the purpose of determining the Contribution Value
of a Northern Telecom Property and subject to certain adjustments and
deductions expressly provided in this definition, means the sum of the
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gross rental income, including applicable Pro Forma Reimbursable
Amounts, scheduled to be paid by each Tenant under its Lease for the
twelve (12) month period commencing on the Contribution Date, subject
to the following:
i. If Tenant rent free concessions for a Lease exceed (A) three
(3) months for a Lease that has an original term of at least
five (5) years, or (B) one (1) month for a Lease that has an
original term of less than five (5) years (in either case,
such excess, the "Excess Tenant Concessions"); then, the
amount included in determining Gross Income from this Lease
shall equal the dollar amount derived from the following
formula:
(A) [(B - C) /B] = D
where in the foregoing formula:
A = gross rental income, including applicable
Pro Forma Reimbursable Amounts, scheduled to be paid
under the Lease for the twelve (12) month period
commencing on the Contribution Date;
B = total gross rental income, including applicable Pro
Forma Reimbursable Amounts, scheduled to be paid under
the Lease for the original term of the Lease,
calculated without regard to Excess Tenant
Concessions;
C = total value of the Excess Tenant Concessions for the
initial term of the Lease; and
D = amount to be included in Gross Income from the Lease.
ii. If the allowance for tenant finish exceeds Ten Dollars ($10.00)
per square foot below hung ceiling for any Lease (excluding the
Northern Telecom Lease) in a Northern Telecom Property, for the
purpose of determining Gross Income from that Northern Telecom
Property, the rental income attributable to the twelve (12) month
period commencing on the Contribution Date shall be reduced by
the amount attributable to that twelve (12) month period for
amortization of such excess tenant allowance and lease
commissions on that excess tenant allowance. For this purpose,
the amortization shall be computed by treating the amount of the
excess tenant allowance and related commission cost as a loan to
Tenant having a term equal to the original term of the Lease and
bearing interest at a simple interest rate per annum of ten and
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one-quarter percent (10.25%) to be repaid in equal monthly
installments of principal and interest over the original term of
the Lease.
j. "Hazardous Materials" means (i) those substances included within
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definitions of or identified as "hazardous substances," "hazardous
materials," or "toxic substances" in or pursuant to Environmental
Laws; (ii) those substances listed in the United States Department of
Transportation Table (40 CFR 172.101 and amendments thereto) or by the
Environmental Protection Agency (or any successor agency) as hazardous
substances (40 CFR Part 302 and amendments thereto); (iii) any
material, waste or substance which is or contains (A) petroleum,
including crude oil or any fraction thereof, natural gas or synthetic
gas usable for fuel or any mixture thereof, or any product containing
the foregoing substances, (B) asbestos or asbestos containing
material, (C) polychlorinated biphenyls, (D) any substance designated
as "hazardous substance" pursuant to Section 311 of the Clean Water
Act, 33 U.S.C. (S) 1251 et seq. (33 U.S.C. (S) 1321), or listed
-- ---
pursuant to Section 307 of the Clean Water Act (33 U.S.C. (S) 1317);
(E) flammable explosives; (F) radioactive materials; and (iv) such
other substances, materials and wastes which are or become regulated
as hazardous, toxic or "special wastes" under Environmental Laws.
k. "X.X. Xxxxxxx" means Xxxxxx X. Xxxxxxx, an individual resident of
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North Carolina.
l. "Improvements" means all buildings, structures and other improvements,
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including such fixtures as constitute real property, located on the
Land.
m. "Intangible Personal Property" means any intangible personal property
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now or hereafter owned by Project Entity in connection with the Land,
the Improvements or the Tangible Personal Property, and all of Project
Entity's rights under all contracts, utility arrangements, and other
agreements relating to the ownership, operation and occupancy thereof,
including, without limitation, warranties from contractors on the
Improvements, roof warranties, equipment warranties, the Leases and
Service Contracts; provided, however, the term "Intangible Personal
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Property" does not include any cash on hand and in bank accounts,
notes receivable, accounts receivable (except as provided in Paragraph
11) rights under pending litigation, any rights to the name "Lichtin
Properties, Inc.", and any prepaid insurance premiums.
n. "Land" means those certain tracts or parcels of real property located
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in Wake County, North Carolina, and containing approximately 33.4
acres, in the aggregate, as more particularly described in Exhibit D,
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attached hereto and by this reference made a part hereof, together
with all of Project Entity's right, title and interest in and to all
appurtenances, rights, easements, tenements and hereditaments incident
thereto.
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o. "Lease" means any lease or occupancy agreement affecting the Northern
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Telecom Properties.
p. "Leasing Guidelines" means the leasing guidelines set forth on Exhibit
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E, attached hereto and by this reference made a part hereof.
q. "Lender" means the holder of an Existing Loan.
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r. "Liens" means any liens, security interests, mortgages, deeds of
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trust, charges, claims, encumbrances, pledges, options, rights of
first offer or first refusal and any other rights or interests of
others of any kind or nature, actual or contingent, or other similar
encumbrances of any nature whatsoever.
s. "M.A. Xxxxxxxxx" means Xxxxx Xxxxxxxxxx Xxxxxxxxx, an individual
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resident of Texas.
t. "Net Operating Income", for the purposes of determining the
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Contribution Value of a Northern Telecom Property as of its
Contribution Date, means (i) Vacancy Adjusted Gross Income; less (ii)
Operating Expenses.
u. "Non-Vacated Northern Telecom Property" means any Northern Telecom
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Property for which Northern Telecom has not elected on or before June
30, 1997, to exercise its early termination option with respect to all
or any portion of the space it leases in that Northern Telecom
Property.
v. "Northern Telecom" means Northern Telecom Inc., a Delaware
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corporation.
w. "Northern Telecom Lease" means that certain Lease Agreement, dated
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June 20, 1995, by and between Perimeter Park Associates, a North
Carolina general partnership and predecessor to Project Entity, as
Landlord therein, and Northern Telecom Inc., a Delaware corporation,
as Tenant therein, pursuant to which Northern Telecom leases all of
the Northern Telecom Properties.
x. "Northern Telecom Property" means the Real Property, the Tangible
Personal Property and the Intangible Personal Property located at,
attributable to or used in connection with one of the six (6) projects
identified on Exhibit A, attached hereto and by this reference made a
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part hereof; and Northern Telecom Property and the Intangible Personal
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Property located at, attributable to or used in connection with all of
the six (6) projects identified on Exhibit A hereto. Any reference to
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a specific Northern Telecom Property shall be made by incorporating
the name of the project as set forth on Exhibit A; for example, a
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specific reference to the first listed Northern Telecom Property shall
be the "100 Perimeter Park Property".
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y. "Operating Expenses", for the purposes of determining the Contribution
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Value of a Northern Telecom Property, means the applicable Pro Forma
Annual Operating Expense for the twelve (12) month period commencing
on the Contribution Date for that Northern Telecom Property. Operating
Expenses also shall include, without limitation, (i) a management fee
equal to the greater of (A) four percent (4%) (or such other
percentage as is contractually agreed in a Lease for the gross rental
income from that Lease) of Vacancy Adjusted Gross Income (but not
including reimbursables) for the twelve (12) month period commencing
on the Contribution Date for that Northern Telecom Property or (B)
fifty-eight cents ($.58) per annum per square foot of area, (ii) an
owner's expense reimbursement charge of forty-two cents ($.42) per
annum per square foot of area, and (iii) a reserve for expenses in the
amount of eight cents ($.08) per annum per square foot of area.
z. "Partnership Amendment" means that certain Second Amendment to Second
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Amended and Restated Agreement of Limited Partnership, dated of even
date herewith, pursuant to which X.X. Xxxxxxx and M.A. Xxxxxxxxx,
among others, are admitted as limited partners to Weeks.
aa. "Permitted Exceptions" means those matters set forth in Exhibit F,
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attached hereto and by this reference made a part hereof, together
with any matter expressly approved by Weeks pursuant to this
Agreement.
bb. "PPW" means Perimeter Park West Associates Limited Partnership, a
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North Carolina limited partnership having X.X. Xxxxxxx and M.A.
Xxxxxxxxx as its General Partners.
cc. "Pro Forma Annual Operating Expense" means the pro forma annual
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operating expense set forth on Exhibit G, attached hereto and by this
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reference made a part hereof.
dd. "Pro Forma Reimbursable Amounts" means the pro forma reimbursable
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amounts also set forth on said Exhibit G hereto.
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ee. "Project Entity" means NTP Limited Partnership, a North Carolina
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limited partnership, having X.X. Xxxxxxx and M.A. Xxxxxxxxx as its
General Partners, as to the 000 Xxxxxxxxx Xxxx Property, the 000
Xxxxxxxxx Xxxx Property and the 000 Xxxxxxxxx Xxxx Property; Perimeter
Park Associates, a North Carolina general partnership having X.X.
Xxxxxxx and M.A. Xxxxxxxxx as its sole General Partners, as to 000
Xxxxxxxxx Xxxx Property, the 000 Xxxxxxxxx Xxxx Property and the 000
Xxxxxxxxx Xxxx Property; and, as to any Vacated Northern Telecom
Property, any new Project Entity formed pursuant to Paragraph 3b of
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this Agreement from and after the date of formation and conveyance of
that Vacated Northern Telecom Property thereto.
ff. "Real Property" means collectively, the Land and the Improvements.
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gg. "Rent Roll" means any and all Leases containing, with respect to each
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Lease, information as to the commencement date of such Lease, the
termination date of such Lease, any renewal rights or expansion rights
under such Lease, the approximate square footage of the leased
premises under such Lease, the annual base rental and additional rent
due under such Lease, and the amount and duration of any rent or other
concessions made to the Tenant under such Lease. The Rent Roll
attached hereto as Exhibit H and by this reference made a part hereof,
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sets forth the status of leasing at the Northern Telecom Properties as
of the date hereof.
hh. "Rights Agreements", collectively, means that certain Registration
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Rights and Lock-Up Agreement and that certain Registration Rights and
Lock-Up Agreement for Post-June 30, 1998 Shares and Units, both dated
of even date herewith and both by and among Weeks and X.X. Xxxxxxx,
M.A. Xxxxxxxxx and certain other contributors identified in the
Transaction Documents.
ii. "Service Contracts" means any and all of the service contracts,
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equipment, labor or material contracts, management contracts,
maintenance or repair contracts, personal property leases or other
agreements (other than the Leases and related lease commission
agreements) entered into by Project Entity (or its predecessors) and
that are in force and effect and that affect the Northern Telecom
Properties or the operation, repair, or maintenance thereof.
jj. "Security Deposits" means the refundable deposits (in the form of
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cash, letters of credit or certificates of deposit) made by Tenants
with Project Entity as security for such Tenants' obligations under
their respective Leases, to the extent not previously forfeited,
applied or refunded, together with interest thereon accrued as of the
Contribution Date which Project Entity is obligated to pay to any such
Tenants.
kk. "Stabilization", with reference to a specific Northern Telecom
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Property, means that all of the following conditions have been met:
(i) ninety-five percent (95%) of the net leasable area of the
Improvements have been leased to creditworthy Tenant(s) approved by
Weeks under Lease(s) approved by Weeks (which will base its approval
on commercially reasonable standards); (ii) Tenant(s) are in actual
possession and have accepted possession of ninety-five percent (95%)
of the net leasable area of the Improvements; (iii) except for free-
rent periods expressly stipulated in the Lease(s), rental shall have
commenced on ninety-five percent (95%) of the net leasable area of the
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Improvements and all other concessions (besides any free rent periods)
shall have expired; (iv) no default by Project Entity or any Tenant is
then outstanding and uncured under the Lease(s), and (v) all of
matters described in the foregoing four (4) clauses have been
confirmed to Weeks by the Tenant(s) pursuant to Tenant Estoppel
Certificate(s). For the purposes this definition, the Contributors
and Weeks agree that the net leasable area of the Improvement in each
Northern Telecom Property is that set forth on Exhibit A hereto.
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ll. "Tangible Personal Property" means all tangible personal property
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located on the Real Property which is owned by Project Entity and used
in the ownership, operation and maintenance of the Land and
Improvements, including, without limitation, all art, furniture,
furnishings, fixtures and equipment and stock for completion of Tenant
improvements.
mm. "Tenant" means any Tenant or lessee under any of the Leases.
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nn. "Tenant Estoppel Certificate" means the certificate to be submitted
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for execution to each Tenant with respect to the Lease pursuant to
which such Tenant leases space in the Improvements, such certificate
to be in the form attached hereto as Exhibit I and incorporated herein
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by this reference.
oo. "To Contributors' Knowledge" means to the current actual knowledge of
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X.X. Xxxxxxx, Xxxxx X. Xxxxxx, Xxxxxx X. Xxxxxxxxx and Xxxxx X. Xxxx.
pp. "Total Potential Gross Income", for the purpose of determining Vacancy
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Adjusted Gross Income, means at the Contribution Date the sum of (i)
Gross Income, and (ii) the amount of Gross Income (including Pro Forma
Reimbursable Amounts) that would accrue from all vacant space in a
Northern Telecom Property if such vacant space were leased at the
rental rates specified in the Leasing Guidelines, and assuming a term
of less than 10 years, with no adjustment for Excess Tenant
Concessions or excess office finish and related Lease commissions.
qq. "Units" means limited partnership units in Weeks Realty, L.P., as
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described in the Rights Agreements.
rr. "Unit Price" means (i) for Contributions of the Non-Vacated Northern
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Telecom Properties, the arithmetic average, rounded to the nearest
one-eighth (1/8), of the daily closing price of a share of common
stock of Weeks Corporation on the New York Stock Exchange for the
twenty (20) trading days immediately prior to July 1, 1997; provided,
however, if such average is less than Twenty-Five Dollars and Twenty-
Five Cents ($25.25), the Unit Price shall be Twenty-Five Dollars and
Twenty-Five Cents ($25.25) and, if such average exceeds Twenty-Seven
Dollars ($27.00), the Unit Price shall be Twenty-Seven Dollars
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($27.00); and (ii) for Contribution of a Vacated Northern Telecom
Property, the arithmetic average, rounded to the nearest one-eighth
(1/8), of the daily closing price of a share of common stock of Weeks
Corporation on the New York Stock Exchange for the twenty (20) trading
days immediately prior to the Contribution Date for that Vacated
Northern Telecom Property. The Unit Price set forth in clause (i) of
the immediately preceding sentence is a negotiated amount for the
purposes of this Agreement and does not reflect a valuation by the
Contributors or Weeks of Weeks Corporation or Weeks.
ss. "Vacancy Adjusted Gross Income", to adjust for possible future
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vacancy, for each Northern Telecom Property as of the Contribution
Date, means the following:
i. If on the Contribution Date, less than ninety-five percent
(95%) of the space in such Northern Telecom Property is
leased, then the Vacancy Adjusted Gross Income shall equal
the Gross Income.
ii. If on the Contribution Date, at least ninety-five percent
(95%) of the space in such Northern Telecom Property is
leased, then the Vacancy Adjusted Gross Income shall be
the lesser of:
(1) Gross Income of that Northern Telecom Property; or
(2) ninety-five percent (95%) of Total Potential Gross
Income of that Northern Telecom Property, plus an
amount equal to five percent (5.0%) of the Gross
Income attributable to leases having a term of ten
years or more.
2. COVENANT TO CONTRIBUTE. The Contributors hereby covenant and agree to
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contribute the Northern Telecom Properties to the capital of Weeks pursuant to
the structure outlined in Paragraph 3 of this Agreement and in accordance with,
and subject to, the terms and conditions of this Agreement. Weeks hereby
covenants and agrees to accept Contribution of the Northern Telecom Properties
to its capital pursuant to the structure outlined in Paragraph 3 of this
Agreement and in accordance with, and subject to, the terms and conditions of
this Agreement.
3. STRUCTURE OF CONTRIBUTION. Subject to the other terms and conditions
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of this Agreement, the Contribution of the Northern Telecom Properties shall be
structured as follows:
a. With respect to the Non-Vacated Northern Telecom Properties, the following
shall take place: (i) on the Contribution Date immediately prior to
Contribution, the Vacated Northern Telecom Properties shall be conveyed to
one or more newly formed limited partnerships each having the Contributors
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as its partners (and thereafter, as to each Vacated Northern Telecom
Property, all references in this Agreement to a Project Entity shall mean
that newly formed limited partnership which owns that Vacated Northern
Telecom Property), (ii) on the Contribution Date, each of the Contributors
shall contribute to the capital of Weeks all general partnership interests
and limited partnership interests in the original Project Entity, (iii) in
exchange for the Contribution of ownership interests in that Project
Entity, as described in the immediately preceding clause (ii), Weeks shall
issue Units to the Contributors and make cash payments to, at the direction
of, or on behalf of the Contributors as provided in Paragraph 7, and (iv)
immediately following such Contribution as described in clause (ii) above,
on the Contribution Date, Weeks, as the sole owner of all ownership
interests in that Project Entity, shall dissolve that Project Entity and
all assets of that Project Entity, including the Non-Vacated Northern
Telecom Properties, shall be distributed in dissolution to, and become part
of the capital of, Weeks and the Existing Loans encumbering the Non-Vacated
Northern Telecom Properties shall be assumed by Weeks subject to the non-
recourse provisions thereof.
b. With respect to each Vacated Northern Telecom Property, the following shall
take place: (i) on the Contribution Date, each of the Contributors shall
contribute to the capital of Weeks all general partnership interests and
limited partnership interests in the Project Entity that owns that Vacated
Northern Telecom Property, (ii) in exchange for the Contribution of
ownership interests in that Project Entity, as described in the immediately
preceding clause (i), Weeks shall issue Units to the Contributors as
provided in Xxxxxxxxx 0, (xxx) PPW shall immediately distribute such Units
it received pursuant to clause (ii) above pro rata to its partners in
accordance with their respective ownership percentages in PPW, and (iv)
immediately following such Contribution as described in clause (i) above,
on the Contribution Date, Weeks, as the sole owner of all ownership
interests in that Project Entity, shall dissolve that Project Entity and
all assets of that Project Entity, including the Vacated Northern Telecom
Property, shall be distributed in dissolution to, and shall become part of
the capital of, Weeks and the Existing Loans encumbering that Vacated
Northern Telecom Property shall be assumed by Weeks subject to the non-
recourse provisions thereof.
c. Notwithstanding the provisions of Paragraph 3a and 3b above to the
contrary, the Contributors may elect to cause the Contribution of a
Northern Telecom Property to be made by general warranty deed from the
Project Entity to Weeks.
4. CONTRIBUTION DATE. The Contribution Date for the Northern Telecom
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Property shall be established as follows:
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a. The Contributors shall Contribute the Non-Vacated Northern Telecom
Properties to Weeks pursuant to this Agreement on July 1, 1997, which date
shall be the Contribution Date for the Non-Vacated Northern Telecom
Properties.
b. Each of the Vacated Northern Telecom Properties shall be Contributed by the
Contributors to Weeks pursuant to this Agreement on the earlier of (i) June
30, 2000, or the (ii) date on which that Vacated Northern Telecom Property
achieves Stabilization, which date, in either case, shall be the
Contribution Date for that Vacated Northern Telecom Property.
5. CONTRIBUTION VALUE. The Contribution Value of a Northern Telecom
------------------
Property shall be determined as of its Contribution Date in accordance with the
following:
a. For each Non-Vacated Northern Telecom Property, the Contribution Value
shall equal the Net Operating Income of that Non-Vacated Northern Telecom
Property determined as of its Contribution Date divided by decimal one zero
four (.104).
b. For each Vacated Northern Telecom Property, the Contribution Value shall
equal the Net Operating Income of each Vacated Northern Telecom Property
determined as of its Contribution Date divided by decimal one zero five
(.105).
c. Notwithstanding the provisions of Paragraph 5a and 5b to the contrary, if
all of the Northern Telecom Properties are to be contributed on July 1,
1997 (as a result of Northern Telecom's not exercising its early
termination option as to any space it leases in the Northern Telecom
Properties), the Contribution Value for all of the Northern Telecom
Properties in the aggregate shall be Twenty-Three Million Seven Hundred
Thousand Dollars ($23,700,000).
6. ADJUSTED CONTRIBUTION VALUE. After determination of the Contribution
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Value of a Northern Telecom Property, such Contribution Value shall be subject
to the following further prorations, allocations and adjustments, all as of the
Contribution Date (the "Adjusted Contribution Value"):
a. If no adjustment to Gross Income has been made for free rent concessions
pursuant to the definition of Gross Income, the Contribution Value shall be
reduced by the amount of free rent concessions unexpired as of the
Contribution Date; provided, however, the Contributors may elect to make a
cash payment to Weeks for the amount of unexpired free rent concessions in
lieu of such adjustment.
b. If adjustment to Gross Income has been made for excess tenant allowance and
related lease commission pursuant to clause (ii) of the definition of Gross
Income, the Contribution Value shall be increased by the actual cost of the
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tenant allowance in excess of Ten Dollars ($10.00) per square foot and
related lease commissions.
c. If the Northern Telecom Property is to be contributed subject to an
Existing Loan in accordance with the terms and conditions of Paragraph 9 of
this Agreement, the Contribution Value shall be reduced by the outstanding
principal balance of that Existing Loan as of the Contribution Date.
d. Any reduction in the Contribution Value pursuant to Paragraph 9b iii of
this Agreement.
e. Any other adjustment to the Contribution Value for which express provision
is made in this Agreement
f. In the event that the Adjusted Contribution Value of a Vacated Northern
Telecom Property is less than the outstanding principal balance on the
Contribution Date of the Existing Loan that encumbers that Vacated Northern
Telecom Property, then the Contributors shall pay to Weeks on the
Contribution Date a cash payment equal to the excess of such outstanding
balance over the Adjusted Contribution Value and, for the purposes of
Xxxxxxxxx 0x of this Agreement, no additional Units shall be issued to the
Contributors for Contribution of that Vacated Northern Telecom Property. In
lieu of such cash payment, the Contributors may elect to surrender and
return to Weeks without compensation a number of Units equal to the
quotient of such excess divided by the Unit Price. This obligation of the
Contributors to make this cash payment is joint and several and is secured
by the pledge of Units and Shares contained in the Partnership Amendments.
7. CASH PAYMENTS AND ISSUANCE OF UNITS. At Contribution, Weeks shall
-----------------------------------
make cash payments and issue Units to the Contributors as provided in this
Paragraph 7:
a. On the Contribution Date for the Non-Vacated Northern Telecom Properties,
Weeks shall wire transfer funds available for immediate credit to accounts
designated in writing by the Contributors, amounts not to exceed in the
aggregate, the lesser of (i) the Adjusted Contribution Value for the Non-
Vacated Northern Telecom Properties, or (ii) an amount equal to $10,000,000
less the cash payments made by Weeks to the contributors at Initial
Contribution. At Contribution, the Contributors shall designate to Weeks in
writing an allocation of this cash payment by Non-Vacated Northern Telecom
Property and, with respect to each Non-Vacated Northern Telecom Property,
by each Contributor.
b. For each Non-Vacated Northern Telecom Property, to the extent the Adjusted
Contribution Value exceeds the cash payments allocated to that Non-Vacated
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Northern Telecom Property pursuant to Paragraph 7a of this Agreement, on
the Contribution Date, Weeks shall issue to each of the Contributors, pro
rata in accordance with their respective ownership interests in the Project
Entity, a number of Units equal to the quotient of such excess divided by
the Unit Price.
c. For each Vacated Northern Telecom Property, on the Contribution Date, Weeks
shall issue to each of the Contributors, pro rata in accordance with their
respective ownership interests in the Project Entity, a number of Units
equal to the quotient of the Adjusted Contribution Value divided by the
Unit Price.
d. Units issued by Weeks to the Contributors pursuant to this Agreement shall
be held by the Contributors subject to the terms and conditions of the
Partnership Amendment and the applicable Rights Agreements.
e. Notwithstanding any provision of this Agreement to the contrary, no
fractional Units shall be issued to the Contributors pursuant to this
Agreement. If as a result of the application of the foregoing formulas, a
fractional Unit is due any Contributor, Weeks shall pay to that
Contributor, in cash on the same date as the fractional Unit would
otherwise be issued and in lieu of any such fractional Unit, an amount
equal to that fractional Unit times the applicable Unit Price, as
determined pursuant to this Agreement.
8. INTERIM CONDUCT.
---------------
a. The Contributors hereby covenant and agree with Weeks that, so long as this
Agreement remains in full force and effect, the Contributors will not
permit any Project Entity to sell, assign, rent, lease, convey (absolutely
or as security), grant a security interest in, or otherwise encumber or
dispose of, the Northern Telecom Properties (or any interest or estate
therein) without the prior written consent of Weeks; provided, however, a
Project Entity may enter into Leases for space in the Northern Telecom
Properties without the prior written consent of Weeks so long as (i) the
terms of the Lease equal or exceed the Leasing Guidelines, (ii) the
prospective Tenant is approved by Weeks, in the exercise of commercially
reasonable judgment (provided, however, if the Tenant is an affiliate of
the Contributors, Weeks may elect to withhold its approval in its absolute
and sole discretion), (iii) the Lease is on a form previously approved by
Weeks, and (iv) within ten (10) business days after written request by
Weeks, the Contributors shall furnish a copy of any such Lease which has
been executed since the last such request to Weeks.
b. The Contributors covenants and agrees that, so long as this Agreement
remains in full force and effect, the Contributors will not permit Project
Entity to amend or modify the Existing Loan Documents in any way, will
cause Project Entity to make all payments of money, and will cause Project
-13-
Entity to perform all obligations, required under the Existing Loan
Documents. The Contributors will take no affirmative action and will not
permit Project Entity to take any affirmative action which shall cause the
Contributors to be unable to contribute good and marketable title to the
Northern Telecom Properties or which shall cause any warranty or
representation contained in this Agreement to be incorrect or misleading in
any material respect at any time.
c. Promptly after Northern Telecom exercises its "First Option" (as that term
is defined in the Northern Telecom Lease) to release all or a portion of
the space from the Northern Telecom Lease, the Contributors shall notify
Weeks of such exercise which notice shall be accompanied by a copy of the
"Release Notice" (as that term is defined in the Northern Telecom Lease).
d. On even date herewith, the Contributors shall cause the Project Entity to
enter into an agreement with Weeks (i) for the provision of construction
and development services with respect to the construction of Tenant
improvements in each of the Vacated Northern Telecom Properties for which
Weeks shall earn fees equal to five percent (5%) of the hard cost of Tenant
construction commenced after the date this Agreement, payable monthly; and
(ii) for the provision of property management and leasing services for each
of the Northern Telecom Properties for a term commencing on the date hereof
and ending, with respect to each of the Northern Telecom Properties, on the
date that Northern Telecom Property is contributed to Weeks for (A) a
management fee equal to the greater of fifty-eight cents ($.58) per annum
per square foot or four percent (4%) (or such other percentage as is
contractually agreed in a Lease with respect to the rental collected from
that Lease) of the gross collected rent (excluding reimbursables) for each
of the Northern Telecom Properties, payable monthly; (B) an owners expense
reimbursement fee of forty-two cents ($.42) per annum per square foot; and
(C) leasing fees customary to the market. When a Vacated Northern Telecom
Property is conveyed to a new Project Entity pursuant Paragraph 3b of this
Agreement, such new Project Entity shall take subject to and assume the
above described agreements for construction and development services and
for management and leasing services.
e. The Contributors shall fund to Weeks, upon written request, all costs to be
incurred or incurred in re-leasing space to bring the Vacated Northern
Telecom Properties to Stabilization, including costs incurred to upfit the
space to meet the requirements of any new tenant, leasing commissions and
tenant concessions (other than free rent).
9. EXISTING LOANS.
--------------
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a. The Northern Telecom Properties are subject to the Existing Loans and are
encumbered by the Existing Loan Documents. At the time the Contributors
notify Weeks that a Northern Telecom Property is to be contributed to Weeks
pursuant to this Agreement, such notice shall state whether (i) the
Contributors, at their sole cost and expense, will pay-in-full the Existing
Loan that encumbers each Northern Telecom Property to be contributed and
cause the Existing Loan Documents to be canceled immediately prior to the
Contribution, or (ii) the Contributors intend to contribute the Northern
Telecom Property subject to the Existing Loan to Weeks pursuant to this
Agreement.
b. Weeks agrees to accept a Contribution of a Northern Telecom Property
subject to the Existing Loan applicable thereto and assume the Existing
Loan (subject to its non-recourse provisions), provided each of the
following conditions is satisfied at the time of Contribution to the
reasonable satisfaction of Weeks:
i. On or before Contribution, Weeks shall receive from the Lender of
the Existing Loan an estoppel and consent agreement in form and
content reasonably acceptable to Weeks confirming, among such
other matters as Weeks may reasonably require, that it is the
holder of the applicable Existing Loan Documents, the outstanding
principal of the Existing Loan, that no default is then
outstanding, identifying the applicable Existing Loan Documents,
confirming the amounts of any tax and insurance escrows, and
consenting to the Contribution to Weeks of the Northern Telecom
Property as provided in this Agreement and the assumption by
Weeks, subject to the limited recourse provision therein
contained, of the Existing Loan.
ii. On or before the Contribution, the agreement by the Lender of the
Existing Loan to modification of the applicable Existing Loan
Documents to reflect change in ownership (e.g., financial
---
reporting requirements, transfer restrictions, deletion of any
personal covenants specific to the Contributors and other matters
that Weeks, in the exercise of commercially reasonably judgment,
deems necessary or appropriate [but in no event, shall Weeks
propose amendments to the loan amount, loan term, payment
schedule or interest rate, except as provided in clause (iii)
below]).
iii. The Contributors, at their sole cost and expense, shall have
obtained the agreements of New England Mutual Life Insurance
Company shall agree to either (i) permit early prepayment of each
of the Existing Loans held by it, at par, and without penalty or
prepayment fee of any kind, at any time on or after the
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Contribution Date, or (ii) a reduction of the interest rate of
each of the Existing Loans held by it to eight and one-quarter
percent (8.25%). If after reasonable efforts the Contributors are
unable to obtain the agreement of New England Mutual Life
Insurance Company to either prepayment at par or an interest rate
reduction as described in the immediately preceding sentence, in
lieu of such renegotiated terms, the Contribution Value of 000
Xxxxxxxxx Xxxx Property, 000 Xxxxxxxxx Xxxx Property and 000
Xxxxxxxxx Xxxx Property each shall be reduced by One Hundred
Eighty-Seven Thousand Five Hundred Dollars ($187,500), for a
total reduction of Five Hundred Sixty-Two Thousand Five Hundred
Dollars ($562,500).
iv. The Contributors shall pay all transfer fees and all other
expenses and costs imposed by the Lender of the Existing Loan,
including, without limitation, its attorneys' fees and expenses,
as a condition to assumption.
10. TITLE AND SURVEY.
----------------
a. Weeks hereby approves the Permitted Exceptions (including, without
limitation, the Leases identified on the Rent Roll) and agrees to accept
the Contribution of a Northern Telecom Property subject to the Permitted
Exceptions applicable to the Northern Telecom Property, except for those
Permitted Exceptions that relate to the Existing Loan that encumbers that
Northern Telecom Property that is not to be assumed by Weeks pursuant to
Paragraph 9 of this Agreement.
b. Within thirty (30) days before the Contribution Date of a Northern Telecom
Property, Weeks shall cause title and survey to be updated and Weeks shall
identify in such notice any title exception (other than Permitted
Exceptions) Weeks determines to be objectionable. The Contributors shall
cure any such exception on or before the Contribution Date to Weeks'
reasonable satisfaction and, if such cure is not completed by that date,
then the Contribution shall be delayed for a period not to exceed sixty
(60) days to permit the Contributors additional time to cure. If after such
delay, such title objection is not cured to Weeks' reasonable satisfaction,
Weeks may elect to do one of the following: (i) cure the exception, with
all costs and expenses incurred by Weeks applied to reduce the Contribution
Value and the Adjusted Contribution Value, in which case the Contribution
shall be further delayed an additional sixty (60) day period, or (ii)
terminate this Agreement as to that Northern Telecom Property or as to the
remaining uncontributed Northern Telecom Properties (if the nature of the
exception is such that it affects the remaining uncontributed Northern
Telecom Properties).
-16-
11. DATE, TIME AND PLACE OF CONTRIBUTION. Each Contribution shall
------------------------------------
commence at 9:00 a.m., local time, on the Contribution Date at the offices of
Xxxxxxx Xxxxxxxxx Xxxxxxx & Xxxxxxx, L.L.P., Two Hanover Square, Suite 1900, 000
Xxxxxxxxxxxx Xxxxxx Xxxx, Xxxxxxx, Xxxxx Xxxxxxxx 00000-0000, or at such other
place as may be agreed by the Contributors and Weeks. The following adjustments
and prorations shall be made on the Contribution Date with respect to the
Northern Telecom Property to be Contributed on that date by appropriate cash
payments between the Contributors and Weeks.
a. The Contributors shall be entitled to all rents [including any additional
rent and any accrued tax and operating expense reimbursements, subject to
clause (b) below], charges, and other revenue of any kind attributable to
any period under the Leases or otherwise up to but not including the
Contribution Date. Weeks shall be entitled to all rents [including any
additional rent and any accrued tax and operating expense reimbursements,
subject to clause (b) below], charges and other revenue of any kind
attributable to any period under the Leases or otherwise on and after the
Contribution Date. Rents and expense escalations or other reimbursements
due landlord under the Leases collected prior to the Contribution Date and
attributable to both the Contributors' and Weeks' periods of ownership
shall be prorated as of the Contribution Date. Uncollected rents and
expense escalations or other reimbursements due landlord under the Leases
shall not be prorated at the time of Contribution, but Weeks shall include
such amounts in Weeks' monthly billing statements to the Tenants, make
reasonable efforts to collect the same and tender the same to X.X. Xxxxxxx,
as agent for the Contributors, upon receipt, provided that all rents,
escalations and other reimbursements due landlord under the Leases
collected by Weeks on or after the Contribution Date shall be prorated as
of the Contribution Date and shall first be applied to all amounts due
under the Leases at the time of collection (i.e., current rents, delinquent
rents attributable to periods after Contribution and sums due Weeks as the
current owner and landlord) with the balance (if any) payable to the
Contributors, but only to the extent of amounts delinquent and actually due
the Contributors. The Contributors and Project Entity shall not have any
right to xxx any Tenant under the Leases for sums due the Contributors for
periods attributable to the Contributors' ownership of the Northern Telecom
Property. The Contribution Value shall not be reduced for Security
Deposits, which shall be transferred to the Partnership at Contribution.
The Contributors shall pay cash to Weeks for the amount of pre-paid rentals
held by the Contributors under the Leases.
b. Real estate taxes shall be prorated as of the Contribution Date. The
Contributors shall be responsible for all real estate taxes attributable to
the Northern Telecom Property to, but not including the, Contribution Date.
If the real estate tax rate and assessments have not been set for the year
in which the Contribution occurs, then the proration of such taxes shall be
-17-
based upon the rate and assessments for the preceding tax year, and such
proration shall be adjusted in cash between the Contributors and Weeks upon
presentation of written evidence that the actual taxes paid for the year in
which the Contribution occurs differ from the amounts used at Contribution.
Notwithstanding the foregoing, the Contributors shall be entitled to a
refund of their proportionate share of such taxes for which the Project
Entity has not been reimbursed by Tenants, to the extent Weeks after
Closing recovers an increase in taxes attributable to the year in which
contribution occurs from the Tenants under the Leases, and Weeks agrees to
conduct an annual reconciliation of tax "pass-through" for the tax year of
Closing in accordance with the terms of the Leases.
c. Operating expenses for the Northern Telecom Property shall be prorated as
of the Contribution Date. The Contributors shall pay all utility charges
and other operating expenses attributable to the Northern Telecom Property
for the period prior to but not including the Contribution Date (except for
those utility charges and operating expenses payable by Tenants in
accordance with the Leases) and Weeks shall pay all utility charges and
other operating expenses attributable to the Northern Telecom Property for
the period on or after the Contribution Date. Notwithstanding the
foregoing, the Contributors shall be entitled to a refund of the
Contributors' proportionate share of such operating expenses for which the
Contributors has not been reimbursed by Tenants, to the extent Weeks after
Contribution recovers such reimbursement in operating expenses attributable
to the year in which Contribution occurs from the Tenants under the Leases,
and Weeks agrees to conduct an annual reconciliation of operating expenses
"passthrough" for the Contribution in accordance with the terms of the
Leases. The Contributors shall cause the Project Entity to assign to Weeks
any deposits with any of the utility services or companies servicing the
Northern Telecom Property. Weeks shall arrange with such services and
companies to have accounts transferred to Weeks' name beginning at 12:01
a.m. on the day following the Contribution Date.
d. If the Northern Telecom Property is to be contributed subject to an
Existing Loan in accordance with the terms and conditions of Paragraph 9 of
this Agreement, (i) the Contributors shall make a cash payment to Weeks
equal to the sum of the amount of accrued but unpaid interest due under the
Existing Loan attributable to any period up to, but not including, the
Contribution Date; and (ii) Weeks shall make a cash payment to the
Contributors equal to the amount of any tax, insurance premium or other
escrow deposits maintained pursuant to the Existing Loan Documents.
e. If at any time following the Contribution Date the amount of an item listed
in the subparagraphs of this Paragraph 11 shall prove to be incorrect, the
party in whose favor the error was made shall promptly pay to the other
party the sum necessary to correct such error upon receipt of proof of such
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error, provided that such proof is delivered to the party from whom payment
is requested on or before one (1) year after the Contribution Date.
12. COSTS AND EXPENSES; PREPARATION OF DOCUMENTS. Costs and expenses
--------------------------------------------
shall be apportioned in the following manner:
a. Weeks shall pay the premium for title insurance, the survey fees and
recording costs related to each Contribution, as well as all costs incurred
by it in inspecting the Northern Telecom Properties and making such other
investigations thereof as it deems appropriate.
b. The Contributors shall pay all transfer taxes, if any, and any fees and
expense imposed by a Lender under Paragraph 9 hereof.
c. Each party shall pay its own attorneys' fees in connection with this
transaction.
d. Weeks' attorney shall prepare all Contribution documents, which shall be
subject to the reasonable approval of the Contributors' attorney and which
shall be substantially the same as the documents used in the Initial
Contribution.
13. ACCESS TO AND EXAMINATION OF THE NORTHERN TELECOM PROPERTIES. Weeks,
------------------------------------------------------------
personally or through agents, employees or contractors, may go upon the Northern
Telecom Properties during normal business hours prior to Contribution to conduct
such soil, engineering, environmental and other tests, investigations and
analyses of the Land and Improvements as Weeks deems desirable and to review and
make photocopies of the Leases, lease commission agreements, Service Contracts,
amendments, contracts and plans and specifications relating to or affecting the
Northern Telecom Properties. Weeks shall pay all costs incurred in making such
tests, analyses, copies, and investigations. In no event shall Weeks conduct any
intrusive or destructive tests, analyses, or investigations of the Northern
Telecom Properties without first obtaining the Contributors' written consent,
which will not be unreasonably withheld. Weeks acknowledges that any such
examinations or inspections of the Northern Telecom Properties pursuant to this
subparagraph or otherwise are subject to the rights of all Tenants, and Weeks
agrees to conduct such inspections or examinations in such a manner so as to
honor the rights of the Tenants and to prevent disruption of the ordinary
operation of the Tenants' business on the Northern Telecom Properties. Weeks
agrees to repair any damage to the Northern Telecom Properties resulting or
relating to such inspection or examination and agrees to and does hereby
indemnify, defend, and hold the Contributors harmless from any personal injury,
death, damage to property, damages, liens, claims, losses, and liabilities
arising out of Weeks' exercising such right and privilege to go upon the
Northern Telecom Properties, including the acts and omissions of Weeks'
employees, agents, contractors and consultants (but under no circumstances shall
Weeks be liable to the Contributors for consequential damages attributable to
-19-
the results or findings of such tests). Weeks' indemnity under this
subparagraph shall survive the Contribution or any termination of this
Agreement.
14. REPRESENTATIONS AND WARRANTIES OF THE CONTRIBUTORS. As of the date of
--------------------------------------------------
this Agreement, the Contributors hereby make, jointly and severally, for the
benefit of Weeks the following representations and warranties:
a. Project Entity is a limited partnership duly formed, validly existing and
in good standing under the laws of the State of North Carolina and has the
requisite authority to enter into and perform this Agreement. The
Contributors are the only general partners, limited partners, as
applicable, of Project Entity.
b. The execution, delivery and performance of this Agreement by Project Entity
has been duly and validly authorized by all necessary partnership action.
This Agreement has been duly executed and delivered by the Contributors and
constitutes a legal, valid and binding obligation of the Contributors,
enforceable against the Contributors in accordance with the terms hereof
(except as enforcement may be limited by bankruptcy, insolvency or other
laws affecting enforcement of creditors' rights generally and general
equity principles).
c. Except as has been obtained or is being effected as part of the
consummation of the Transaction, no consent, waiver, approval or
authorization of, or filing, registration or qualification with, or notice
to, any governmental unit or any other regulatory body is required to be
made, obtained or given by the Contributors in connection with the
execution, delivery and performance of this Agreement by the Contributors
or the Project Entities.
d. Except for waivers and consents that have been obtained prior to the date
hereof, except as provided in Paragraph 9 of this Agreement, and except as
would not have a material adverse effect on any of the Northern Telecom
Properties, no consent of any party to any agreement, contract, mortgage,
indenture, lease, reciprocal easement or operating agreement or other
arrangement, to which the Contributors or Project Entity is a party, or, by
which the Contributors or Project Entity is bound, is required in
connection with the execution, delivery or performance by the Contributors
of this Agreement or the consummation of the transactions provided for
herein.
e. None of the execution, delivery and performance of this Agreement by the
Contributors does or will, with or without the giving of notice, lapse of
time or both, (i) violate, conflict with or constitute a default under any
term or condition of (A) the organizational documents of Project Entity, or
(B) any term or provision of any judgment, decree, order, statute,
injunction, rule or regulation of a governmental unit applicable to the
Contributors or Project Entity or any agreement, contract, mortgage,
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indenture, lease, reciprocal easement or operating agreement or other
arrangement to which any Contributor or Project Entity is a party or by
which it is bound or to which any of its assets or any of the Northern
Telecom Properties is subject, except as provided in Paragraph 9 of this
Agreement and except in the case where appropriate waivers and consents
have been obtained prior to the date hereof, and except as would not have a
material adverse effect on the Contributors, Project Entity or any of the
Northern Telecom Properties, or (ii) result in the creation of any lien or
other encumbrance upon the assets of the Contributors, Project Entity or
any of the Northern Telecom Properties, except as may be contemplated by
this Agreement or the other Transaction Documents, and except as would not
have a material adverse effect on the Contributors, Project Entity or any
of the Northern Telecom Properties.
f. Project Entity has complied with all laws applicable to the conduct of the
business of Project Entity and to the ownership, use and operation of the
Northern Telecom Properties and has obtained all licenses and permits
required for the conduct thereof, except where the failure to so comply or
obtain will not have a material adverse effect on Project Entity or any of
the Northern Telecom Properties. To the Contributors' knowledge, such
licenses and permits are in full force and effect, the Contributors and
Project Entity have not taken any action that would (or failed to take any
action the omission of which would) result in the revocation of such
licenses or permits, and the Contributors and Project Entity have not
received any notice of violation from any federal, state or municipal
entity or written notice of an intention by any such government entity to
revoke any certificate of occupancy or other certificate, license or permit
issued by it in connection with the use of any of the Northern Telecom
Properties, that in each case has not been cured or otherwise resolved to
the satisfaction of such government entity, except where such failure or
such action will not have a material adverse effect on the Contributors,
Project Entity or any of the Northern Telecom Properties.
g. With regard to investment:
i. Each Contributor is acquiring Units for its own account and not
with a view to, or for sale in connection with, the
"distribution", as such term is used in Section 2(11) of the
Securities Act of 1933, as amended (the "Securities Act"), of
any of Units in violation of the Securities Act.
ii. Each Contributor is an "accredited investor", as that term is
defined in Rule 501(a) of Regulation D promulgated under the
Securities Act.
iii. Each Contributor understands that the Units have not been
registered under the Securities Act by reason of a specific
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exemption from the registration provisions of the Securities Act
which depends upon, among other things, the nature of the
investment intent and the accuracy of such Contributor's
representations as expressed herein.
h. Each Contributor has had an opportunity to discuss Weeks' business,
management and financial affairs with Weeks' management and the opportunity
to review Weeks' financial records.
i. Each Contributor understands and acknowledges that no public market now
exists for any of the securities issued by Weeks and that there can be no
assurance that a public market will ever exist for the Units.
j. Each Contributor has such knowledge and experience in financial and
business matters that each Contributor is capable of evaluating the merits
and risks of the purchase of the Units pursuant to this Agreement and of
protecting each Contributor's interests in connection herewith.
k. The Contributors and Project Entity have not knowingly caused or permitted
any Hazardous Material to be improperly maintained or disposed of on, under
or at any of the Northern Telecom Properties or any part thereof. To the
Contributors' knowledge, and except as may be revealed in the environmental
reports (which are identified in Exhibit J): (i) no liability under or
---------
violation of any Environmental Laws exists with respect to Northern Telecom
Properties, (ii) the Contributors and Project Entity have not received any
written notice from any governmental agency or instrumentality having
jurisdiction thereof of any violation of any Environmental Laws that
remains uncured as of the date hereof or that it has any material liability
with respect thereto, (iii) there are no administrative, regulatory or
judicial proceedings pending or threatened against Project Entity pursuant
to, or alleging any material violation of, or material liability under any
Environmental Laws, (iv) none of the properties now or heretofore owned,
leased or used by Project Entity has been used as a storage or disposal
site (whether temporary or permanent) for any hazardous, toxic or dangerous
materials the storage or disposal of which is governed by any Environmental
Laws in violation of such Environmental Laws, (v) there are no underground
storage tanks located on, under or about any of the Northern Telecom
Properties, and there is no facility located on or at any of the Northern
Telecom Properties that is subject to the reporting requirements of Section
312 of the Federal Emergency Planning and Community Right to Know Act of
1986 and the federal regulations promulgated thereunder (42 U.S.C. (S)
11022) and (vi) no Hazardous Material has been improperly maintained or
disposed of on, under or at any of the Northern Telecom Properties or any
part thereof. In connection with the representations and warranties in this
-22-
subparagraph, Weeks acknowledges that the Contributors disclaims any
professional expertise with respect to Environmental Laws.
l. With respect to the Northern Telecom Properties, Project Entity (i) is the
sole owner and (ii) has good, valid and marketable title, free and clear of
all Liens other than the following:
i. Liens securing the Existing Loans, Liens, or deposits made to
secure the release of such Liens, securing taxes, the payment of
which is at the time not delinquent or the payment of which is
actively being contested in good faith by appropriate proceedings
diligently pursued, and for which appropriate reserves shall have
been established by Project Entity.
ii. Attachments, judgments and other similar Liens arising in
connection with court or administrative proceedings, provided,
that the execution or other enforcement of such Liens is
effectively stayed or secured and the claims secured by such
Liens are actively being contested in good faith by appropriate
proceedings diligently pursued, and for which appropriate
reserves shall have been established by Project Entity.
iii. Zoning laws and ordinances; provided that, to the Contributors'
knowledge, none of the Northern Telecom Properties are in
violation thereof, in any material respect and that such laws and
ordinances do not require the demolition, vacation or cessation
of the use for industrial or office purposes (as applicable) of
any portion of the improvements material to each of the Northern
Telecom Properties or require the discontinuance of the use of
all or any material portion of any of the Northern Telecom
Properties as industrial facilities or office buildings.
iv. Any laws, ordinances, deeds of trust, mortgages, liens,
easements, rights of way, restrictions, exemptions, reservations,
conditions, limitations, covenants, encumbrances, adverse rights
or interests and other matters defined as Permitted Exceptions;
provided that, to the Contributors' knowledge, the Northern
Telecom Properties are not in violation thereof in any material
respect and the same do not require the demolition, vacation or
cessation of the use of for industrial or office purpose of any
portion of the improvements material to such Northern Telecom
Properties or require the discontinuance of the use of all or any
material portion of such Northern Telecom Properties as
industrial facilities or office buildings.
-23-
v. Any other easements, rights of way, restrictions, exceptions,
reservations, conditions, limitations, covenants, adverse rights
or interests, licenses, minor irregularities in title and other
similar encumbrances which do not in the aggregate materially
impair the use of such properties in the operation of the
business of Project Entity.
vi. Any law or governmental regulation or other right of any
governmental unit, which (i) requires the person to maintain
certain facilities or perform certain acts as a condition of its
occupancy or use of its assets and properties, or (ii) condemns,
appropriates or recaptures the person's assets or property.
vii. Liens imposed by laws, such as carriers', warehousemen's and
mechanics' Liens and other similar Liens arising in the ordinary
course of business which secure payment of obligations not more
than sixty (60) days past due or which are being contested in
good faith by appropriate proceedings diligently pursued, and for
which appropriate reserves shall have been established by Project
Entity.
m. The Contributors and Project Entity have not received any written or other
actual notice of any violation of any applicable zoning regulation or
ordinance, or of any employment or other regulatory law, order, regulation
or requirement relating to Project Entity's operations, practices,
properties or assets that remain uncured as of the date hereof, and, to the
Contributors' Knowledge, there are no such violations that, individually or
in the aggregate, will have a material adverse effect on any of the
Northern Telecom Properties.
n. Project Entity has no liabilities of any nature, whether matured or
unmatured, fixed or contingent, regardless of whether the disclosure
thereof would otherwise be required by GAAP, which would have, individually
or in the aggregate, a material adverse effect upon Project Entity or any
of the Northern Telecom Properties except for (1)Leases identified on the
Rent Roll, (2) the commission obligations identified on Exhibit P hereto,
---------
(3) Existing Loan Documents, (4) the Permitted Exceptions and (5) the
Service Contracts (collectively, the "Significant Agreements"), or as shown
on the audits of the books and records described in Section 8.2 of the
Contribution Agreement for Completed Properties.
o. With respect to the Existing Loans, the Contributors represent and warrant
as follows:
i. The loan documents identified on Exhibit C hereto constitute all
---------
of the documents that evidence or secure the Existing Loans; and
such documents have not been amended or modified except as
-24-
expressly identified on said Exhibit C. The Contributors have
---------
delivered to Weeks true, correct and complete copies of all of
the Existing Loan Documents.
ii. All payments due and payable on or before the date of this
Agreement under the Existing Loan Documents by Project Entity
have been paid, and no monetary default exists as of the date of
this Agreement.
iii. As of the date of this Agreement, no written notice of a default
is outstanding and, to the Contributors' Knowledge, no condition
exists which with the giving of notice or the passage of time or
both would constitute an event of default under the Existing Loan
Documents.
p. Each of the Significant Agreements referred to in subparagraph n above is
(to the Contributors' Knowledge, with respect to parties thereto other than
Project Entity) valid and binding and in full force and effect, enforceable
against the parties thereto in accordance with its terms (except as
enforcement may be limited by bankruptcy, insolvency or other laws
affecting enforcement of creditors' rights generally and general equitable
principles).
q. Other than as set forth in Exhibit K hereto, there are no claims, actions,
---------
suits, proceedings or investigations pending, or, to the Contributors'
Knowledge, threatened, before any court, governmental unit or arbitrator
with respect to any Project Entity or any Northern Telecom Property, and,
to the Contributors' knowledge, the likely outcome of the claims or other
matters set out in said Exhibit K, will not have a material adverse effect
---------
on the Contributors or any of the Northern Telecom Properties.
r. Each Project Entity is classified as a partnership for federal income tax
purposes and not as an association taxable as a corporation.
s. The Rent Roll attached hereto as Exhibit H for the Northern Telecom
---------
Properties is true, correct and complete with respect to the categories
described therein, except to the extent any inaccuracies would not,
individually or in the aggregate, have a material adverse effect on the
value of any of the Northern Telecom Properties.
t. The Rent Roll lists each of the Leases in effect as of the date of the Rent
Rolls with respect to the Northern Telecom Properties. In the case of any
sublease or assignment of any such Lease, the Tenant listed in such Rent
Roll remains liable for the performance of said Lease.
u. Except as disclosed in the engineering reports listed in Exhibit L,
---------
attached hereto and by this reference made a part hereof, the Improvements
-25-
are in good condition and repair and have not suffered any material
casualty or, to the Contributors' Knowledge, other material damage that has
not been repaired in all material respects. To the Contributors' Knowledge,
there is no material latent or patent structural, mechanical or other
significant defect or deficiency in the Improvements, other than as
disclosed in said engineering reports.
v. No proceedings have been commenced, or, to the Contributors' Knowledge,
threatened, by any authority having the power of eminent domain to condemn
any part of any of the Northern Telecom Properties or any Improvements
thereon that, if successful, would have a material adverse effect on any of
the Northern Telecom Properties.
w. To the Contributors' Knowledge, none of the Tenants now occupying the
Northern Telecom Properties or having a Lease of space in the Northern
Telecom Property is the subject of any bankruptcy, reorganization,
insolvency or similar proceedings.
x. Exhibit M, attached hereto and by this reference made a part hereof, sets
---------
forth an accurate and complete list of the insurance policies relating to
the Northern Telecom Properties or any part thereof obtained by and naming
the Project Entities (other than policies obtained or maintained by
tenants); all such policies are in full force and effect and all premiums
thereunder have been paid to the extent due; and no notice of cancellation
has been received with respect thereto and, to the Contributors' Knowledge,
none is threatened.
y. No representation or warranty by the Contributors herein contains any
untrue statement of a material fact or omits to state a material fact
necessary in order to make the statements contained herein, in light of the
circumstances under which they were made, not misleading.
z. None of Project Entity, its general partners or limited partners, as
applicable, owns, directly or indirectly, (i) one percent (1%) or more of
the total combined voting power of all classes of stock entitled to vote,
or one percent (1%) or more of the total number of shares of all classes of
stock, of any corporation that is a Tenant or (ii) an interest of one
percent (1%) or more in the assets or net profits of any Tenant.
aa. Project Entity has not received written notice that any Tenant intends
either to cease such operations (other than temporarily due to casualty,
remodeling, renovation or any similar cause) or to cease operating under
the name under which it was operating as of the date hereof.
-26-
bb. To the Contributors' Knowledge, no condition exists which, with the giving
of notice or the passage of time, or both, would permit any party to cancel
its obligations under any reciprocal easement agreement or Lease, except as
expressly set forth in the Northern Telecom Lease.
cc. Except for routine repairs and maintenance, all alterations, improvements
or other work required to have been completed by Project Entity under any
reciprocal easement agreements and Leases, including, without limitation,
all alterations, improvements and other work required to prepare space for
the initial occupancy of each tenant under a Lease, has heretofore been
completed and paid for in full, except to the extent reflected in Exhibit
-------
N, attached hereto and by this reference made a part hereof.
-
dd. Each of the Northern Telecom Properties is an independent unit which does
not now rely on any facilities (other than facilities covered by Permitted
Exceptions including, without limitations, any reciprocal easement
agreements or facilities of municipalities or public utility and water
companies and other than parking areas which the Northern Telecom
Properties make use of under any reciprocal easement agreements) located on
any property not included in the Real Property that is part of that
Northern Telecom Property to fulfill any municipal or governmental
requirement or for the furnishings to the Northern Telecom Properties of
any essential building systems or utilities.
ee. Project Entity has not received any written notice which is still in effect
that there is, and, to the Contributors' Knowledge, there does not exist,
any violation of a condition or agreement contained in any easement,
restrictive covenant or any similar instrument or agreement affecting the
Northern Telecom Properties or any portion thereof, if such violation would
have a material adverse effect on any of the Northern Telecom Properties.
ff. Project Entity is not in violation of any radius restrictions, exclusive or
similar provisions contained in any reciprocal easement agreements, Leases
or any other agreements to which Project Entity is a party or is bound, if
such violation would have a material adverse effect on Project Entity or
any of the Northern Telecom Properties.
gg. Project Entity is solvent, has not made a general assignment for the
benefit of its creditors, and has not admitted in writing its inability to
pay its debts as they become due, nor has Project Entity filed, nor does it
contemplate the filing of, any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings, or any other proceeding for the
relief of debtors in general, nor has any such proceeding been instituted
by or against Project Entity, nor is any such proceeding to the
Contributors' Knowledge threatened or contemplated.
-27-
hh. Attached hereto as Exhibit O is a schedule of the Service Contracts now in
---------
effect to which Project Entity and/or the Northern Telecom Properties are
subject. No notice of default has been received by Project Entity from any
of the parties to the Service Contracts and, to the Contributors'
Knowledge, no event has occurred which, with notice or lapse of time, or
both, will constitute any such default. There are no Service Contracts
affecting any of the Northern Telecom Properties other than as listed on
said Exhibit O, and the Service Contracts are in full force and effect.
---------
ii. All leasing commissions payable in connection with the Leases now in
occupancy have been paid-in-full, including leasing commissions payable
with respect to extensions, expansions and renewals which have not been
exercised as of the date hereof or payable in the event a Tenant does not
exercise a cancellation right under its Lease, except for commission
obligations identified on Exhibit P, attached hereto and by this reference
---------
made a part hereof.
jj. The Contributors do not lease space at the Northern Telecom Properties, and
no tenant at the Northern Telecom Properties is "related" to the
Contributors or the Project Entities within the meaning of Section 267(b)
or Section 707(b) of the Internal Revenue Code of 1986, as amended.
kk. No interest in the Northern Telecom Properties is or is deemed to be,
directly or indirectly, an asset of a "Plan" (as defined in the next
sentence). "Plan" means an "employee benefit plan" as defined in Section
----
3(3) of the Employee Retirement Income Security Act of 1974, as amended, or
a "plan" within the meaning of Section 4975(e)(1) of the Internal Revenue
Code of 1986, as amended.
ll. Each Project Entity is classified as a partnership for federal income tax
purposes and not as an association taxable as a corporation.
mm. The representations and warranties of the Contributors contained in this
Paragraph 14, as updated and reaffirmed at each Contribution Date, shall
continue in effect as provided in the Partnership Amendment.
15. REPRESENTATIONS AND WARRANTIES OF WEEKS. Weeks represents and
---------------------------------------
warrants to the Contributors, as follows:
a. Weeks is a limited partnership duly formed, validly existing and in good
standing under the laws of the State of Georgia. By the first Contribution
Date, Weeks will be qualified to transact business in the State of North
Carolina. Weeks has full power and authority to execute and deliver this
Agreement and all other documents executed and delivered, or to be executed
and delivered, by it (contemporaneously herewith or at Contribution) in
-28-
connection with the transactions described herein and to perform all of its
obligations arising under this Agreement and such other documents; the
officers executing this Agreement and such other documents on behalf of
Weeks have the authority to bind Weeks hereunder and thereunder.
b. Neither the execution and delivery of this Agreement nor any other
documents executed and delivered, or to be executed and delivered by Weeks
(contemporaneously herewith or at Contribution) in connection with the
transactions described herein will violate any provision of Weeks' limited
partnership agreement, articles of incorporation or by-laws of Weeks'
General Partner or of any agreements, regulations, or laws to which Weeks
is bound, except for waivers and consents that have been obtained prior to
the date hereo f.
c. To Weeks' knowledge, there is no action, suit, proceeding, or claim
affecting Weeks pending or being prosecuted in any court or by or before
any federal, state, county, or municipal department, commission, board,
bureau, agency, or other governmental instrumentality which would prevent
consummation by Weeks of the Contribution of the Northern Telecom
Properties or materially and adversely affect the performance of any of
Weeks's other obligations hereunder to be performed prior to, at or after
Contribution.
d. Weeks is solvent, has not made a general assignment for the benefit of its
creditors, and has not admitted in writing its inability to pay its debts
as they become due, nor has Weeks filed, nor does it contemplate the filing
of, any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings, or any other proceeding for the relief of debtors in general,
nor has any such proceeding been instituted by or against Weeks, nor is any
such proceeding to Weeks' knowledge threatened or contemplated.
16. CONDITIONS.
----------
a. In addition to any other conditions provided in this Agreement, Weeks'
obligation to accept Contribution of a Northern Telecom Property pursuant
to this Agreement is subject to the satisfaction of each of the following
conditions at or prior to the Contribution Date for that Northern Telecom
Property:
i. The Contributors shall have complied with and performed all of
its obligations and covenants set forth in this Agreement.
ii. On or before the Contribution Date, the Contributors shall have
executed and delivered all documents required to be delivered by
the Contributors pursuant to the terms of this Agreement.
Additionally, the Contributors shall have delivered to Weeks
reasonable evidence of its authority to consummate the
-29-
transaction herein contemplated, including without limitation, an
opinion of counsel in form and content reasonably acceptable to
Weeks.
iii. All of the representations and warranties made by the
Contributors in Paragraph 14 shall be true correct at and as of
the Contribution Date as though such representations and
warranties were made both at and as of the date hereof and at and
as of the Contribution Date. Provided, further, the
representations and warranties concerning Rent Roll and Leases,
when reaffirmed at Contribution shall be made with respect to a
Rent Roll made as of Contribution and such Rent Roll shall
disclose no material changes from the Rent Roll attached hereto
as Exhibit H, except those approved by Weeks in writing.
---------
iv. The Contributors shall have obtained and delivered to Weeks by
the date and time of Contribution a Tenant Estoppel Certificate
for all Leases then in effect in the Northern Telecom Property,
each duly executed by an authorized officer of the Tenant under
such Lease and dated no earlier than sixty (60) days before the
Contribution Date. The Contributors agrees to use the
Contributors' diligent good faith efforts to obtain such Tenant
Estoppel Certificates at or prior to Contribution. Any material
modification to the form of Tenant Estoppel Certificate shall be
approved in writing by Weeks in advance and, in Weeks'
discretion, may be the basis upon which Weeks excludes such
certificate in the determination as to whether this condition has
been satisfied. During the term of this Agreement, as and when
received, the Contributors shall provide to Weeks copies of each
Tenant Estoppel Certificate received from any Tenant promptly
after receipt of such Tenant Estoppel Certificate. Weeks shall
have the right to delay Contribution by up to thirty (30) days by
written notice to the Contributors if the Contributors has not
obtained the required Tenant Estoppel Certificates. Additionally,
with respect to the Contribution of the Non-Vacated Northern
Telecom Properties, the Tenant Estoppel Certificate from Northern
Telecom must confirm that the "First Option" (as defined in the
Northern Telecom Lease) has lapsed, unexercised, as to the Non-
Vacated Northern Telecom Properties.
v. No material adverse change shall have occurred to the Northern
Telecom Properties, except as otherwise provided in Paragraphs 17
and 18.
vi. A title insurance company approved by Weeks shall be prepared to
issue to Weeks title insurance coverage on ALTA Form Policy, in
-30-
an amount not in excess of the Adjusted Contribution Value, and
specifying as exceptions to coverage only the Permitted
Exceptions.
vii. The contingencies set forth in this Paragraph 16(a) are for the
sole benefit of Weeks, and Weeks may elect in writing to waive
any such contingency reserved for its benefit and proceed to
consummate the transaction contemplated hereby.
b. In addition to any other conditions provided in this Agreement, the
Contributors' obligation to contribute a Northern Telecom Property is
subject to the satisfaction of each of the following conditions at or prior
to the Contribution Date for that Northern Telecom Property:
i. Weeks shall have complied with and performed all of its
obligations and covenants set forth in this Agreement.
ii. On or before the Contribution Date, Weeks shall have executed and
delivered all documents required to be delivered by Weeks
pursuant to the terms of this Agreement, and shall have issued
Units and made cash payments to Contributors as required under
Paragraph 7 hereof. Additionally, Weeks shall have delivered to
the Contributors reasonable evidence of its authority to
consummate the transaction herein contemplated, including without
limitation, an opinion of counsel in form and content reasonably
acceptable to the Contributors.
iii. All of the representations and warranties made by Weeks in
Paragraph 15 shall be true and correct at and as of the
Contribution Date as though such representations and warranties
were made both at and as of the date hereof and at and as of the
Contribution Date.
iv. The contingencies set forth in this Paragraph 16(b) are for the
sole benefit of the Contributors, and the Contributors may elect
in writing to waive any such contingency reserved for its benefit
and proceed to consummate the transaction contemplated hereby.
17. FIRE AND CASUALTY. Prior to the Contribution of a Northern Telecom
-----------------
Property, the risk of loss shall remain with the Contributors and the
Contributors shall bear all ownership risks and obligations, including
construction risks and the risk of cost overruns. The Contributors shall
maintain in effect until the Contribution Date all insurance policies currently
in force with respect to the Northern Telecom Property to be contributed
including liability insurance and fire and extended coverage insurance. If at
any time prior to the Contribution Date any portion of the Northern Telecom
-31-
Properties is destroyed or damaged as a result of fire or any other casualty (a
"Casualty"), the Contributors shall promptly give written notice (a "Casualty
Notice") thereof to Weeks. If a Northern Telecom Property is the subject of a
Casualty, Weeks shall have the right, at its sole option, of terminating this
Agreement (by written notice to the Contributors given within thirty (30) days
after receipt of the Casualty Notice from the Contributors) as to that Northern
Telecom Property, unless
(a) (i) all such damage or destruction is repaired at the sole cost
and expense of the Contributors prior to Contribution to substantially the
condition existing immediately prior to such damage or destruction, or (ii) the
cost to fully repair or restore such damage is less than Two Hundred Fifty
Thousand Dollars ($250,000) and either (x) insurance proceeds sufficient to
restore fully such damage are available and the insurance company issuing the
Contributors' insurance policies has confirmed in writing prior to the
expiration of such thirty (30) day period that such Casualty is covered by such
policies and that no defense to payment of the claim on account thereof exists,
or (y) the Contributors give Weeks a credit at Contribution (the "Credit") in an
amount equal to the deficiency in any insurance proceeds described in clause
(x); and
(b) such Casualty (i) does not result in Tenants terminating their
Leases or asserting a right to terminate their Leases, and (ii) would not
entitle Tenants occupying more than twenty-five percent (25%) of the space in
the Northern Telecom Property in the aggregate to terminate their Leases after
Contribution if such Tenants have not waived such right as of Contribution.
If a Casualty Notice is given to Weeks less than thirty (30) days prior to
Contribution at Weeks' option Contribution shall be postponed to a date not
earlier than thirty (30) days after Weeks' receipt of the Casualty Notice. If
Weeks terminates this Agreement pursuant to this Paragraph, then this Agreement
shall terminate and the parties hereto shall have no further rights or
obligations hereunder, with regard to that Northern Telecom Property. If Weeks
does not terminate this Agreement, the proceeds of any insurance with respect to
the Northern Telecom Property paid between the date of this Agreement and the
Contribution Date, together with the Credit if applicable, shall be paid to
Weeks at the time of Contribution and all unpaid claims and rights in connection
with property damage to the Northern Telecom Properties shall be assigned to
Weeks at Contribution without in any manner affecting the Adjusted Contribution
Value.
18. EMINENT DOMAIN. In the event of a taking by condemnation or eminent
--------------
domain proceedings of any material portion of a Northern Telecom Property [prior
to Contribution, the Contributors shall promptly give written notice thereof to
Weeks and Weeks shall have the right, at its sole option, of terminating this
Agreement as to that Northern Telecom Property by written notice given to the
Contributors on or before the tenth (10th) day following receipt of such notice.
For purposes hereof, a "material portion" of any Northern Telecom Property shall
-32-
be any portion upon which an improvement is located, any portion which contains
enough parking spaces, the loss of which would cause a violation of any Lease on
the Northern Telecom Property or cause a violation of any applicable zoning
ordinance or which permanently alters the access to and from the Northern
Telecom Property in a material adverse way. If Weeks so terminates this
Agreement as to that Northern Telecom Property, then this Agreement shall
terminate as to that Northern Telecom Property, and the parties hereto shall
have no further rights or obligations hereunder. If Weeks does not terminate
the Agreement pursuant to this Paragraph as to that Northern Telecom Property,
then the Contributors shall pay over to Weeks on the Contribution Date all
monies received or collected by the Contributors by reason of such taking, and
the Contributors shall further assign and transfer to Weeks all of the
Contributors' right, title and interest of, in and to any awards that have been
or may be made for such condemnation or eminent domain proceedings and the
additional money that may be payable when the same is and becomes assignable as
a matter of law.
19. DEFAULT.
-------
a. If Weeks defaults hereunder, the Contributors may either proceed against
Weeks at law for damages or seek specific performance of Weeks' obligations
hereunder.
b. If the Contributors default hereunder, Weeks may either proceed against the
Contributors at law for damages or seek specific performance of the
Contributors' obligations hereunder. After notice as provided in Paragraph
19(c) below, and lapse of cure period without cure by the Contributors,
Weeks may elect to cure the Contributors' default hereunder and the
Contributors shall promptly, upon demand, reimburse Weeks for all costs and
expenses incurred in cure, including interest on such costs and expenses,
at a rate equal to LIBOR plus one hundred and thirty-five (135) basis
points, per annum, from the date incurred until the date of reimbursement,
and upon Contribution of the Northern Telecom Property in question, if
ever, the Adjusted Contribution Value for such Northern Telecom Property
shall be reduced by such costs and expenses of cure and accrued interest
thereon.
c. Prior to exercising any of its rights hereunder or at law or in equity for
a default, a party shall give the other party written notice of such
default hereunder and the other party shall have thirty (30) days to cure
such default from and after such notice.
d. After Closing, the liability of the Contributors for a breach of the
representations and warranties by the Contributors in this Agreement shall
be governed by the Partnership Amendment and the pledge of Units and Shares
of therein contained.
-33-
20. BROKERAGE FEES. Except for brokers paid-in-full at the Initial
--------------
Contribution pursuant to separate written agreements for the entire Transaction,
the Contributors and Weeks each represent and warrant to the other that they
have not employed, retained, or consulted any broker, agent, or finder in
connection with this Agreement or the Contribution, and the Contributors and
Weeks each hereby indemnify and agree to hold the other harmless from and
against any and all claims, demands, causes of action, debts, liabilities,
judgments and damages (including costs and reasonable attorneys' fees incurred
in connection with the enforcement of this indemnity) which may be asserted or
recovered against the indemnified party for or on account of any brokerage fee,
commission, or other compensation arising by reason of the indemnitor's breach
of this representation and warranty.
21. MISCELLANEOUS.
-------------
a. Weeks shall not assign, sell, convey or otherwise transfer any or all its
rights under this Agreement without the prior written consent of the
Contributors. The Contributors shall not assign, sell, convey, or otherwise
transfer any or all of the Northern Telecom Properties or its rights under
this Agreement without the prior written consent of Weeks. No such
assignment by the Contributors or Weeks shall relieve or release the
assigning party of any liability hereunder. Subject to the foregoing, this
Agreement and the terms and provisions hereof shall inure to the benefit of
and be binding upon the successors and assigns of the parties.
b. This Agreement and the other Transaction Documents supersedes all prior
agreements between the parties hereto with respect thereto. No claim of
waiver, modification, consent or acquiescence with respect to any of the
provisions of this Agreement shall be made against either party, except on
the basis of a written instrument executed by or on behalf of such parties.
c. This Agreement shall be governed by and construed in accordance with the
laws of the State of North Carolina.
d. The headings of the several paragraphs and subparagraphs of this Agreement
are inserted solely for the convenience of reference and are not a part of
and are not intended to govern, limit, or aid in the construction of any
term or provision hereof, except otherwise provided in Paragraph 1 of this
Agreement.
e. Words of any gender used in this Agreement shall be held and construed to
include any other gender, and words of a singular number shall be held to
include the plural and vice versa, unless the context requires otherwise.
-34-
f. Any notice, request or other communication (a "notice") required or
------
permitted to be given hereunder shall be in writing and be delivered by
hand or overnight courier (such as UPS Next Day Air) or by facsimile
transmission or mailed by United States registered or certified mail,
return receipt requested, postage prepaid and addressed to each party at
its address as set forth below. Any such notice shall be considered given
on the date of such hand or courier delivery, deposit with such overnight
courier for next business day delivery, or upon transmission by facsimile
with confirmation, or deposit in the United States mail, but the time
period (if any is provided herein) in which to respond to such notice shall
commence on the date of hand or courier delivery or the confirmation date
of facsimile transmission or on the date received following deposit in the
United States mail as provided above. Rejection or other refusal to accept
or inability to deliver because of changed address of which no notice was
given shall be deemed to be receipt of the notice. By giving at least five
(5) days' prior written notice thereof, any party may from time to time and
at any time change its mailing address hereunder. Any notice of any party
may be given by such party's counsel. The parties respective notice
addresses are as follows:
Weeks: Weeks Realty, L.P.
0000 Xxxx Xxxxx
Xxxxxxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxx,
Vice Chairman/Chief
Investment Officer
Fax: (000) 000-0000
With Copy To: King & Spalding
000 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000-0000
Attention: Xxxxxxx X. Xxxxxxxxx, Esq.
Fax: (000) 000-0000
Contributors: Xxxxxx X. Xxxxxxx
Suite 200
0000 Xxxxxxxxx Xxxx Xxxxx
Xxxxxxxxxxx, Xxxxx Xxxxxxxx 00000
Fax: (000) 000-0000
With Copy To: Xxxxxxx Xxxxxxxxx Xxxxxxx & Xxxxxxx, L.L.P.
Two Hanover Square
Suite 1900
000 Xxxxxxxxxxxx Xxxxxx Xxxx
Xxxxxxx, Xxxxx Xxxxxxxx 00000
-35-
Attention: Xxxx X. Xxxxxxxx, Esq.
Fax: (000) 000-0000
g. If any provision of this Agreement or the application thereto to any person
or circumstance shall be invalid or unenforceable to any extent, the
remainder of this Agreement and the application of such provisions to the
other persons or circumstances shall not be affected thereby and shall be
enforced to the greatest extent permitted by law.
h. Nothing in this Agreement shall be construed as giving any person, firm,
corporation, or other entity, other than the parties hereto, their
successors and assigns, any rights, remedy or claim under or in respect to
this Agreement or any provision hereof.
i. This Agreement may be executed in any number of counterparts, each of which
so executed shall be deemed an original; such counterparts together shall
constitute the one agreement.
j. Time is of the essence of this Agreement; provided, however, that if the
-------- -------
time within which any action, consent, approval, or other activity herein
contemplated, expires on a Saturday, Sunday, or legal holiday, such time
period shall automatically be deemed extended to the first day after the
scheduled termination of such time period which is not a Saturday, Sunday,
or legal holiday.
k. No failure or delay by a party to exercise any right it may have by reason
of the default of the other party shall operate as a waiver of default or
modification of this Agreement or shall prevent the exercise of any right
by the first party while the other party continues to be so in default.
l. All representations, warranties and agreements of the Contributors and
Weeks contained in this Agreement shall not be merged into the Contribution
documents and shall survive Contribution subject to the provisions of the
Partnership Amendment.
m. In the event of a breach of this Agreement by either party, the non-
breaching party shall be entitled to recover all costs associated with
enforcing this Agreement, including reasonable attorneys' fees and expenses
actually incurred.
n. So long as a Northern Telecom Property is subject to this Agreement, the
Contributors agree not to offer to any party other than Weeks, that
Northern Telecom Property, or any portion thereof or any interest therein,
for sale or lease, except for the leasing of space pursuant to the terms of
this Agreement, and the Contributors agree not to negotiate, solicit or
-36-
entertain any offers from or with any party other than Weeks, to purchase
or lease the property, or any portion thereof or any interest therein,
except for the leasing of space as aforesaid.
o. Contemporaneously with the execution and delivery of this Agreement, Weeks
and the Contributors shall enter into a short form memorandum of this
Agreement, which shall be recorded in the public records of Wake County,
North Carolina, to give notice of Weeks' interest in the Northern Telecom
Properties pursuant to this Agreement.
p. The Contributors hereby appoint X.X. Xxxxxxx as their authorized
representative under this Agreement. Any direction, consent, approval,
disapproval, authorization or other action required or permitted to be
given or taken under this Agreement by any of the Contributors shall be
given or taken only by X.X. Xxxxxxx. In giving notice to the Contributors
under this Agreement, Weeks may give such notice only to X.X. Xxxxxxx as
provided under Paragraph 21f of this Agreement and such notice shall
constitute notice to all of the Contributors. If Weeks receives notice of
any matter from any Contributor who is not X.X. Xxxxxxx, Weeks shall be
entitled at its discretion to disregard such notice and such notice shall
have no legal effect under this Agreement, unless and until confirmed by
X.X. Xxxxxxx. The written statements and representations of X.X. Xxxxxxx
shall for the purposes of this Agreement be binding upon the Contributors
and Weeks shall have no obligation or duty whatsoever to inquire into the
authority to take any action which he proposes to take, regardless of
whether X.X. Xxxxxxx actually has the authority to take any such action;
and Weeks shall be entitled to rely upon any direction, authorization,
consent, approval or disapproval given by X.X. Xxxxxxx in connection with
any matter arising out of or in connection with this Agreement.
-37-
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above stated.
CONTRIBUTORS:
------------
(SEAL)
-------------------------------
XXXXXX X. XXXXXXX
(SEAL)
-------------------------------
XXXXX XXXXXXXXXX XXXXXXXXX
PERIMETER PARK WEST ASSOCIATES
LIMITED PARTNERSHIP,
a North Carolina limited partnership
By: (SEAL)
-----------------------------
Xxxxxx X. Xxxxxxx,
General Partner
By: (SEAL)
-----------------------------
Xxxxx Xxxxxxxxxx Xxxxxxxxx,
General Partner
[Signatures Continued on Next Page.]
-38-
WEEKS:
-----
WEEKS REALTY, L.P., a Georgia limited partnership
authorized to do business in the State of North
Carolina as Weeks Realty Limited Partnership
By: Weeks GP Holdings, Inc., a Georgia corporation,
sole general partner
By:
--------------------------------------------
Title:
-----------------------------------------
[CORPORATE SEAL]
-39-
EXHIBIT A
---------
NORTHERN TELECOM PROPERTIES
SQUARE
NAME ADDRESS FOOTAGE
1. 000 Xxxxxxxxx Xxxx 55,664
2. 000 Xxxxxxxxx Xxxx 55,664
3. 000 Xxxxxxxxx Xxxx 55,664
4. 000 Xxxxxxxxx Xxxx 74,088
5. 000 Xxxxxxxxx Xxxx 74,017
6. 000 Xxxxxxxxx Xxxx 55,637
------
370,734
=======
A-1
EXHIBIT B
---------
EXISTING LOANS
Maximum Interest Maturity
Project Lender Balance Rate Date (Yr.)
------- ------ ------- -------- ----------
000 Xxxxxxxxx Xxxx Xxx Xxxxxxx 3,238,985 9.625% 2000
Mutual
000 Xxxxxxxxx Xxxx Xxx Xxxxxxx 3,083,927 9.625% 2000
Mutual
000 Xxxxxxxxx Xxxx Xxx Xxxxxxx 3,785,403 9.625% 2000
-----------
Mutual 10,108,315
000 Xxxxxxxxx Xxxx First Union 3,000,000 9.6% 1997
-----------
2,955,346
000 Xxxxxxxxx Xxxx Manulife 4,197,131 8.00% 2006
800 Perimeter Park Manulife 3,103,448 8.00% 2006
-----------
7,300,579
$20,408,894
===========
B-1
