Exhibit 10.22
AGREEMENT OF SALE AND PURCHASE
THIS AGREEMENT OF SALE AND PURCHASE ("AGREEMENT") made this 13th day of
May, 2002 by and between XXXX-XXXX REALTY, L.P., a limited partnership organized
under the laws of the State of Delaware having an address c/o Xxxx-Xxxx Realty
Corporation, 00 Xxxxxxxx Xxxxx, Xxxxxxxx, Xxx Xxxxxx 00000 ("SELLER") and XXXXX
CAPITAL, INC., a corporation organized under the laws of the State of Georgia
having an address at 0000 Xxx Xxxxxxx Xxxxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxx 00000
("PURCHASER").
In consideration of the mutual promises, covenants, and agreements set
forth herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Seller and Purchaser agree as
follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 DEFINITIONS. For purposes of this Agreement, the following
capitalized terms have the meanings set forth in this Section 1.1:
"ASSIGNMENT" has the meaning ascribed to such term in Section 10.3(d)
and shall be in the form attached hereto as EXHIBIT A.
"ASSIGNMENT OF LEASES" has the meaning ascribed to such term in Section
10.3(c) and shall be in the form attached hereto as EXHIBIT B.
"AUTHORITIES" means the various governmental and quasi-governmental
bodies or agencies having jurisdiction over the Real Property and Improvements,
or any portion thereof.
"XXXX OF SALE" has the meaning ascribed to such term in Section 10.3(b)
and shall be in the form attached hereto as EXHIBIT C.
"BROKER" has the meaning ascribed to such term in Section 16.1.
"BUSINESS DAY" means any day other than a Saturday, Sunday or a day on
which national banking associations are authorized or required to close.
"CERTIFICATE AS TO FOREIGN STATUS" has the meaning ascribed to such
term in Section 10.3(g) and shall be in the form attached as EXHIBIT I.
"CERTIFYING PERSON" has the meaning ascribed to such term in Section
4.3(a).
"CLOSING" means the consummation of the purchase and sale of the
Property contemplated by this Agreement, as provided for in Article X.
"CLOSING DATE" means May 29, 2002.
"CLOSING STATEMENT" has the meaning ascribed to such term in Section
10.4(a).
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"CLOSING SURVIVING OBLIGATIONS" means the rights, liabilities and
obligations set forth in Sections 3.2, 3.4, 4.3, 5.4, 8.2, 8.3, 10.4, 10.6,
11.1, 11.2, 12.1, Article XIV, 15.1, 16.1, and Article XVIII, and any other
provisions which pursuant to their terms survives the Closing hereunder.
"CODE" has the meaning ascribed to such term in Section 4.3.
"DEED" has the meaning ascribed to such term in Section 10.3(a).
"DELINQUENT RENTAL" has the meaning ascribed to such term in Section
10.4(b).
"DOCUMENTS" has the meaning ascribed to such term in Section 5.2(a).
"XXXXXXX MONEY DEPOSIT" has the meaning ascribed to such term in
Section 4.1.
"EFFECTIVE DATE" means the latest date on which this Agreement has been
executed by Seller or Purchaser, which date shall be set forth opposite such
party's signature.
"ENVIRONMENTAL LAWS" means each and every federal, state, county and
municipal statute, ordinance, rule, regulation, code, order, requirement,
directive, binding written interpretation and binding written policy pertaining
to Hazardous Substances issued by any Authorities and in effect as of the date
of this Agreement with respect to or which otherwise pertains to or affects the
Real Property or the Improvements, or any portion thereof, the use, ownership,
occupancy or operation of the Real Property or the Improvements, or any portion
thereof, and as same have been amended, modified or supplemented from time to
time prior to the Effective Date, including but not limited to the Comprehensive
Environmental Response, Compensation and Liability Act of 1980 (42 U.S.C.
Section 9601 et seq.) (the "Superfund Act"), the Hazardous Substances
Transportation Act (49 U.S.C. Section 1802 et seq.), the Resource Conservation
and Recovery Act (42 U.S.C. Section 6901 et seq.), as amended by the Hazardous
and Solid Wastes Amendments of 1984, the Water Pollution Control Act (33 U.S.C.
Section 1251 et seq.), the Safe Drinking Water Act (42 U.S.C. Section 300f et
seq.), the Clean Water Act (33 U.S.C. Section 1321 et seq.), the Clean Air Act
(42 U.S.C. Section 7401 et seq.), the Solid Waste Disposal Act (42 U.S.C.
Section 6901 et seq.), the Toxic Substances Control Act (15 U.S.C. Section 2601
et seq.), the Emergency Planning and Community Right-to-Know Act of 1986 (42
U.S.C. Section 11001 et seq.), the Radon and Indoor Air Quality Research Act (42
U.S.C. Section 7401 note, et seq.), the National Environmental Policy Act (42
U.S.C. Section 4321 et seq.), the Superfund Amendment Reauthorization Act of
1986 (42 U.S.C. Section 9601 et seq.), the Occupational Safety and Health Act
(29 U.S.C. Section 651 et seq.) and any statutes regarding environmental issues
in effect in the State of Colorado (collectively, the "ENVIRONMENTAL STATUTES"),
and any and all rules and regulations which have become effective prior to the
date of this Agreement under any and all of the Environmental Statutes.
"ESCROW AGENT" means Commonwealth Title Insurance Company, having an
address at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
"EVALUATION PERIOD" has the meaning ascribed to such term in Section
5.1.
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"GOVERNMENTAL REGULATIONS" means all statutes, ordinances, rules and
regulations of the Authorities applicable to Seller or the use or operation of
the Real Property or the Improvements or any portion thereof.
"HAZARDOUS SUBSTANCES" means (a) asbestos, radon gas and urea
formaldehyde foam insulation, (b) any solid, liquid, gaseous or thermal
contaminant, including smoke vapor, soot, fumes, acids, alkalis, chemicals,
petroleum products or byproducts, PCBs, phosphates, lead or other heavy metals
and chlorine, (c) any solid or liquid waste (including, without limitation,
hazardous waste), hazardous air pollutant, hazardous substance, hazardous
chemical substance and mixture, toxic substance, pollutant, pollution, regulated
substance and contaminant, as such terms are defined in any of the Environmental
Statutes as such Environmental Statutes have been amended and/or supplemented
from time to time prior to the date of this Agreement, and any and all rules and
regulations promulgated under any of the above, and (d) any other chemical,
material or substance, the use or presence of which, or exposure to the use or
presence of which, is prohibited, limited or regulated by any Environmental
Statutes.
"IMPROVEMENTS" means all buildings, structures, fixtures, parking areas
and other improvements located on the Real Property.
"LEASE" means the lease with Tenant, together with all renewals and
modifications thereof, if any, all guaranties thereof, if any.
"LICENSEE PARTIES" has the meaning ascribed to such term in Section
5.1.
"LICENSES AND PERMITS" means, collectively, all of Seller's right,
title and interest, to the extent assignable, in and to licenses, permits,
certificates of occupancy, approvals, dedications, zoning approvals, warranties,
lien waivers, utility arrangements, subdivision maps and entitlements now or
hereafter issued, approved or granted by the Authorities in connection with the
Real Property and the Improvements, together with all renewals and modifications
thereof.
"OPERATING EXPENSES" has the meaning ascribed to such term in Section
10.4(c).
"PERMITTED EXCEPTIONS" has the meaning ascribed to such term in Section
6.2(a).
"PERMITTED OUTSIDE PARTIES" has the meaning ascribed to such term in
Section 5.2(b).
"PERSONAL PROPERTY" means all of Seller's right, title and interest in
and to all equipment, appliances, tools, supplies, machinery, artwork,
furnishings and other tangible personal property attached to, appurtenant to,
located in and used exclusively in connection with the ownership or operation of
the Improvements and situated at the Property at the time of Closing including,
without limitation, the personal property listed on Exhibit J.
"PROPERTY" has the meaning ascribed to such term in Section 2.1.
"PRORATION ITEMS" has the meaning ascribed to such term in Section
10.4(a).
"PURCHASE PRICE" has the meaning ascribed to such term in Section 3.1.
"PURCHASER'S INFORMATION" has the meaning ascribed to such term in
Section 5.3(c).
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"REAL PROPERTY" means that certain parcel or parcels of real property
located at 000 Xxxxx Xxxxxxxxx, Xxxxxx, Colorado, as more particularly described
on the legal description attached hereto and made a part hereof as EXHIBIT D,
together with all of Seller's right, title and interest, if any, in and to the
appurtenances pertaining thereto, including but not limited to Seller's right,
title and interest in and to the adjacent streets, alleys and right-of-ways, and
any easement rights, air rights, subsurface rights, development rights and water
rights.
"RENTAL" has the meaning ascribed to such term in Section 10.4(b), and
same are "Delinquent" in accordance with the meaning ascribed to such term in
Section 10.4(b).
"SECURITY DEPOSITS" means all security deposits paid to Seller, as
landlord (together with any interest which has accrued thereon, but only to the
extent such interest has accrued for the account of the Tenant).
"SIGNIFICANT PORTION" means, for purposes of the casualty provisions
set forth in Article XI hereof, damage by fire or other casualty to the Real
Property and the Improvements or a portion thereof, the cost of which to repair
would exceed Five Hundred Thousand Dollars ($500,000.00) in the aggregate.
"SURVEY OBJECTION" has the meaning ascribed to such term in Section
6.1.
"TENANT" means TRW, Inc.
"TENANT NOTICE LETTERS" has the meaning ascribed to such term in
Section 10.2(e), and are to be delivered by Purchaser to Tenant pursuant to
Section 10.6.
"TERMINATION SURVIVING OBLIGATIONS" means the rights, liabilities and
obligations set forth in Sections 5.2, 5.3, 5.4, 12.1, Articles XIII, and XIV,
Section 16.1, Article XVII, and Sections 18.2 and 18.8, and any other provisions
which pursuant to their terms survive any termination of this Agreement.
"TITLE COMMITMENT" has the meaning ascribed to such term in Section
6.2.
"TITLE COMPANY" means Commonwealth Land Title Insurance Company.
"TITLE AND SURVEY OBJECTIONS" has the meaning ascribed to such term in
Section 6.2.
"TITLE POLICY" has the meaning ascribed to such term in Section 6.2.
"TO SELLER'S KNOWLEDGE" means the present actual (as opposed to
constructive or imputed) knowledge solely of Xxxxx Xxxxxx, as Senior
Vice-President, or Xxxxx Xxxxxxxx, as Senior Director of Development of
Xxxx-Xxxx Realty Corporation, without any independent investigation or inquiry
whatsoever, except that the foregoing individual(s) have reviewed the terms of
this Agreement and have undertaken a reasonable investigation of the facts or
files in their possession necessary to support the terms and provisions of this
Agreement and the definition of "To Seller's Knowledge" shall include the
results of such review and investigations.
"UPDATED SURVEY" has the meaning ascribed to such term in Section 6.1.
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SECTION 1.2 REFERENCES: EXHIBITS AND SCHEDULES. Except as otherwise
specifically indicated, all references in this Agreement to Articles or Sections
refer to Articles or Sections of this Agreement, and all references to Exhibits
or Schedules refer to Exhibits or Schedules attached hereto, all of which
Exhibits and Schedules are incorporated into, and made a part of, this Agreement
by reference. The words "herein," "hereof," "hereinafter" and words and phrases
of similar import refer to this Agreement as a whole and not to any particular
Section or Article.
ARTICLE II
AGREEMENT OF PURCHASE AND SALE
SECTION 2.1 AGREEMENT. Seller hereby agrees to sell, convey and assign
to Purchaser, and Purchaser hereby agrees to purchase and accept from Seller, on
the Closing Date and subject to the terms and conditions of this Agreement, all
of the following (collectively, the "PROPERTY"):
(a) the Real Property;
(b) the Improvements;
(c) the Personal Property;
(d) all of Seller's right, title and interest as lessor in and
to the Lease and, subject to the terms of the Lease, the Security Deposits;
(e) to the extent assignable, all of Seller's right, title and
interest in, to and under the Licenses and Permits; and
(f) all of Seller's right, title and interest, to the extent
assignable or transferable, in and to all other intangible rights, titles,
interests, privileges and appurtenances owned by Seller and related to or used
exclusively in connection with the ownership, use or operation of the Real
Property or the Improvements (the "Intangible Property")
SECTION 2.2 INDIVISIBLE ECONOMIC PACKAGE. Purchaser has no right to
purchase, and Seller has no obligation to sell, less than all of the Property,
it being the express agreement and understanding of Purchaser and Seller that,
as a material inducement to Seller and Purchaser to enter into this Agreement,
Purchaser has agreed to purchase, and Seller has agreed to sell, all of the
Property, subject to and in accordance with the terms and conditions hereof.
ARTICLE III
CONSIDERATION
SECTION 3.1 PURCHASE PRICE. The purchase price for the Property (the
"PURCHASE PRICE") shall be the sum of (a) Fifteen Million Eight Hundred Fifty
Thousand Dollars ($15,850,000), plus (b) Five Million Two Hundred Ten Thousand
Dollars ($5,210,000), all in lawful currency of the United States of America,
payable as provided in Section 3.3 and subject to adjustments and credits as
contemplated hereby. No portion of the Purchase Price shall be allocated to the
Personal Property.
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SECTION 3.2 ASSUMPTION OF OBLIGATIONS. As additional consideration for
the purchase and sale of the Property, at Closing Purchaser will assume, to the
extent assigned by Seller, all of the covenants and obligations of Seller
pursuant to the Lease, Licenses and Permits and Intangible Property, which are
to be performed subsequent to the Closing Date.
SECTION 3.3 METHOD OF PAYMENT OF PURCHASE PRICE. No later than 10:00
a.m. Eastern time on the Closing Date, Purchaser shall pay to Seller the
Purchase Price (less the Xxxxxxx Money Deposit), subject to adjustments and
credits contemplated hereby, together with all other costs and amounts to be
paid by Purchaser at the Closing pursuant to the terms of this Agreement
("PURCHASER'S COSTS"), by Federal Reserve wire transfer of immediately available
funds to the account of Escrow Agent. Escrow Agent, following authorization by
the parties at Closing, shall (i) pay to Seller by Federal Reserve wire transfer
of immediately available funds to an account designated by Seller, the Purchase
Price, subject to adjustments and credits contemplated hereby and less any costs
or other amounts to be paid by Seller at Closing pursuant to the terms of this
Agreement, (ii) pay to the appropriate payees out of the proceeds of Closing
payable to Seller all costs and amounts to be paid by Seller at Closing pursuant
to the terms of this Agreement, and (iii) pay Purchaser's Costs to the
appropriate payees at Closing pursuant to the terms of this Agreement.
ARTICLE IV
XXXXXXX MONEY DEPOSIT
AND ESCROW INSTRUCTIONS
SECTION 4.1 THE XXXXXXX MONEY DEPOSIT. Simultaneously with the
execution and delivery of this Agreement by Purchaser, Purchaser shall deposit
with the Escrow Agent, by Federal Reserve wire transfer of immediately available
funds, the sum of Five Hundred Thousand Dollars ($500,000.00) as the xxxxxxx
money deposit on account of the Purchase Price (the "XXXXXXX MONEY DEPOSIT").
SECTION 4.2 ESCROW INSTRUCTIONS. The Xxxxxxx Money Deposit shall be
held in escrow by the Escrow Agent in an interest-bearing account, in accordance
with the provisions of Article XVII. In the event this Agreement is not
terminated by Purchaser pursuant to the terms hereof by the end of the
Evaluation Period in accordance with the provisions of Section 5.3(c) herein,
the Xxxxxxx Money Deposit and the interest earned thereon shall become
non-refundable to Purchaser except as otherwise set forth herein. In the event
this Agreement is terminated by Purchaser prior to the expiration of the
Evaluation Period, the Xxxxxxx Money Deposit, together with all interest earned
thereon, shall be refunded to Purchaser.
SECTION 4.3 DESIGNATION OF CERTIFYING PERSON. In order to assure
compliance with the requirements of Section 6045 of the Internal Revenue Code of
1986, as amended (the "CODE"), and any related reporting requirements of the
Code, the parties hereto agree as follows:
(a) Provided the Escrow Agent shall execute a statement in
writing (in form and substance reasonably acceptable to the parties hereunder)
pursuant to which it agrees to assume all responsibilities for information
reporting required under Section 6045(e) of the Code, Seller and Purchaser shall
designate the Escrow Agent as the person to be responsible for all information
reporting under Section 6045(e) of the Code (the "CERTIFYING PERSON"). If the
Escrow Agent refuses to execute a statement pursuant to which it agrees to be
the Certifying Person, Seller and Purchaser shall agree to appoint another third
party as the Certifying Person.
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(b) Seller and Purchaser each hereby agree:
(i) to provide to the Certifying Person all
information and certifications regarding such party, as
reasonably requested by the Certifying Person or otherwise
required to be provided by a party to the transaction
described herein under Section 6045 of the Code; and
(ii) to provide to the Certifying Person such party's
taxpayer identification number and a statement (on Internal
Revenue Service Form W-9 or an acceptable substitute form, or
on any other form the applicable current or future Code
sections and regulations might require and/or any form
requested by the Certifying Person), signed under penalties of
perjury, stating that the taxpayer identification number
supplied by such party to the Certifying Person is correct.
ARTICLE V
INSPECTION OF PROPERTY
SECTION 5.1 EVALUATION PERIOD. For the period ending at 5:00 p.m.
Eastern time on May 29, 2002 (the "EVALUATION PERIOD"), Purchaser and its
authorized agents, partners, lenders, officers, employees, advisors, attorneys,
accountants, architects, engineers and other representatives (for purposes of
this Article V, the "LICENSEE PARTIES") shall have the right, subject to the
interests of Tenant arising pursuant to the Lease, to enter upon the Real
Property at all reasonable times during normal business hours to perform an
inspection and evaluation of the Property. Purchaser will provide to Seller
notice (for purposes of this Section 5.1(a), an "ENTRY NOTICE") of the intention
of Purchaser or the other Licensee Parties to enter the Real Property at least
24 hours prior to such intended entry and specify the intended purpose therefor
and the inspections and examinations contemplated to be made and with whom any
Licensee Party will communicate. At Seller's option, Seller may be present for
any such entry and inspection. Purchaser shall not communicate with or contact
Tenant or any of the Authorities without the prior written consent of Seller.
Seller agrees to coordinate a meeting between Purchaser and Tenant's
representatives at a mutually convenient time during the Evaluation Period.
Notwithstanding anything to the contrary contained herein, no invasive physical
testing or invasive sampling shall be conducted during any such entry by
Purchaser or any Licensee Party upon the Real Property without Seller's specific
prior written consent, which consent shall not be unreasonably withheld,
conditioned or delayed.
SECTION 5.2 DOCUMENT REVIEW.
(a) During the Evaluation Period, Purchaser and the
Licensee Parties shall have the right to review and inspect, at Purchaser's
sole cost and expense, all of the following which are in Seller's possession
or control (collectively, the "DOCUMENTS"): all existing environmental,
engineering or consulting reports and studies of the Real Property (which
Purchaser shall have the right to have updated at Purchaser's sole cost and
expense), real estate tax bills, together with assessments (special or
otherwise), ad valorem and personal property tax bills, covering the period
of Seller's ownership of the Property; current operating statements; the
Lease, lease files, Licenses and Permits, Intangible Property and such other
documents, files and items as Purchaser shall reasonably request. Such
inspections shall occur at a location
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reasonably selected by Seller, which may be at the office of Seller,
Seller's counsel, Seller's property manager, at the Real Property or any of
them. Purchaser shall not have the right to review or inspect materials not
directly related to the leasing, maintenance, operation, ownership and/or
management of the Property, including, without limitation, all of Seller's
internal memoranda, financial projections, appraisals, proposals for work not
actually undertaken, and similar proprietary and confidential information.
(b) Purchaser acknowledges that any and all of the Documents
may be proprietary and confidential in nature and have been provided to
Purchaser solely to assist Purchaser in determining the desirability of
purchasing the Property. Subject only to the provisions of Article XII,
Purchaser agrees not to disclose the contents of the Documents or any of the
provisions, terms or conditions contained therein, to any party outside of
Purchaser's organization other than its attorneys, partners, accountants,
lenders, investors or any other Licensee Parties (collectively, for purposes of
this Section 5.2(b), the "PERMITTED OUTSIDE PARTIES"). Purchaser further agrees
that within its organization, or as to the Permitted Outside Parties, the
Documents will be disclosed and exhibited only to those persons within
Purchaser's organization or to those Permitted Outside Parties who are
responsible for determining the desirability of Purchaser's acquisition of the
Property or otherwise involved in performing Purchaser's obligations under this
Agreement. Purchaser further acknowledges that the Documents and other
information relating to the leasing arrangements between Seller and Tenant are
proprietary and confidential in nature. Purchaser agrees not to divulge the
contents of such Documents and other information except in strict accordance
with the confidentiality standards set forth in this Section 5.2 and Article
XII. In permitting Purchaser and the Permitted Outside Parties to review the
Documents and other information to assist Purchaser, Seller has not waived any
privilege or claim of confidentiality with respect thereto, and no third party
benefits or relationships of any kind, either express or implied, have been
offered, intended or created by Seller, and any such claims are expressly
rejected by Seller and waived by Purchaser and the Permitted Outside Parties,
for whom, by its execution of this Agreement, Purchaser is acting as an agent
with regard to such waiver.
(c) Purchaser acknowledges that some of the Documents may have
been prepared by third parties and may have been prepared prior to Seller's
ownership of the Property. PURCHASER HEREBY ACKNOWLEDGES THAT, EXCEPT AS
REPRESENTED IN SECTION 8.1(J), SELLER HAS NOT MADE AND DOES NOT MAKE ANY
REPRESENTATION OR WARRANTY REGARDING THE TRUTH, ACCURACY OR COMPLETENESS OF THE
DOCUMENTS OR THE SOURCES THEREOF. EXCEPT AS REPRESENTED IN SECTION 8.1(J),
SELLER HAS NOT UNDERTAKEN ANY INDEPENDENT INVESTIGATION AS TO THE TRUTH,
ACCURACY OR COMPLETENESS OF THE DOCUMENTS AND IS PROVIDING THE DOCUMENTS SOLELY
AS AN ACCOMMODATION TO PURCHASER.
SECTION 5.3 ENTRY AND INSPECTION OBLIGATIONS; TERMINATION OF AGREEMENT.
(a) Purchaser agrees that in entering upon and inspecting or
examining the Property, Purchaser and the other Licensee Parties will not:
materially disturb the Tenant or materially interfere with the use of the
Property pursuant to the Lease; interfere with the operation and maintenance of
the Real Property or Improvements; damage any part of the Property or any
personal property owned or held by Tenant or any other person or entity; injure
or otherwise cause bodily harm to Seller or Tenant, or to any of their
respective agents, guests,
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invitees, contractors and employees, or to any other person or entity; permit
any liens to attach to the Real Property by reason of the exercise of
Purchaser's rights under this Article V; or reveal or disclose any information
obtained concerning the Property and the Documents to anyone outside Purchaser's
organization, except in accordance with the confidentiality standards set forth
in Section 5.2(b) and Article XII. Purchaser will: (i) maintain (or cause the
appropriate Licensee Parties to maintain) comprehensive general liability
(occurrence) insurance in terms and amounts reasonably satisfactory to Seller
and Workers' Compensation insurance in statutory limits, covering any accident
or event arising in connection with the presence of Purchaser or the other
Licensee Parties on the Real Property or Improvements, and deliver evidence of
insurance verifying such coverage to Seller prior to entry upon the Real
Property or Improvements; (ii) promptly pay when due the costs of all entry and
inspections and examinations done with regard to the Property; (iii) cause any
inspection to be conducted in accordance with standards customarily employed in
the industry and in compliance with all Governmental Regulations; (iv) at
Seller's request, furnish to Seller copies of any studies, reports or test
results received by Purchaser regarding the Property, promptly after such
receipt, in connection with such inspection; and (v) repair any damage to the
Real Property and Improvements caused by any inspection or examination by
Purchaser or its agents. Notwithstanding the foregoing or subsection (b) below
to the contrary, Purchaser shall not be required to restore nor to be liable for
any damage to the Property resulting from the actions or inactions of Seller or
Tenant. In addition, Purchaser shall not be liable to restore any damage to the
Real Property or the Improvements to the extent same is a result of any acts or
omissions of the Seller or the Tenant to the extent of any losses incurred by
Seller or otherwise relating to existing conditions at the Property which are
revealed by Purchaser's investigations permitted hereunder.
(b) Except as stated to the contrary in the last sentence of
(a) above, Purchaser hereby indemnifies, defends and holds Seller and its
partners, agents, directors, officers, employees, successors and assigns
harmless from and against any and all liens, claims, causes of action, damages,
liabilities, demands, suits, obligations to third parties, together with all
losses, penalties, costs and expenses relating to any of the foregoing
(including but not limited to court costs and reasonable attorneys' fees, but
specifically excluding any punitive damages) arising out of any inspections,
investigations, examinations, sampling or tests conducted by Purchaser or any of
the Licensee Parties, whether prior to or after the date hereof, with respect to
the Property.
(c) In the event that Purchaser determines, in its sole and
absolute discretion, that, for any reason, it is not satisfied with the results
of its inspections and evaluations during the Evaluation Period, then Purchaser
shall have the right to terminate this Agreement by providing written notice to
Seller prior to the expiration of the Evaluation Period. In the event Purchaser
terminates this Agreement in accordance with this Section 5.3(c), or under any
other right of termination as set forth herein, Purchaser shall have the right
to receive a refund of the Xxxxxxx Money Deposit, together with all interest
which has accrued thereon, and except with respect to the Termination Surviving
Obligations, this Agreement shall be null and void and the parties shall have no
further obligation to each other. In the event this Agreement is terminated,
Purchaser shall return to Seller all copies Purchaser has made of the Documents
and all copies of any studies, reports or test results regarding any part of the
Property obtained by Purchaser, before or after the execution of this Agreement,
in connection with Purchaser's inspection of the Property (collectively,
"PURCHASER'S INFORMATION") promptly following the time this Agreement is
terminated for any reason.
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SECTION 5.4 SALE "AS IS" THE TRANSACTION CONTEMPLATED BY THIS AGREEMENT
HAS BEEN NEGOTIATED BETWEEN SELLER AND PURCHASER. THIS AGREEMENT REFLECTS THE
MUTUAL AGREEMENT OF SELLER AND PURCHASER, AND PURCHASER HAS THE RIGHT TO CONDUCT
ITS OWN INDEPENDENT EXAMINATION OF THE PROPERTY. OTHER THAN THE MATTERS
REPRESENTED IN SECTION 8.1 HEREOF, BY WHICH ALL OF THE FOLLOWING PROVISIONS OF
THIS SECTION 5.4 ARE MODIFIED AND LIMITED AS IF SUCH EXCEPTION WERE FULLY SET
FORTH THEREIN IN EACH INSTANCE, PURCHASER HAS NOT RELIED UPON AND WILL NOT RELY
UPON, EITHER DIRECTLY OR INDIRECTLY, ANY REPRESENTATION OR WARRANTY OF SELLER OR
ANY OF SELLER'S AGENTS OR REPRESENTATIVES, AND PURCHASER HEREBY ACKNOWLEDGES
THAT NO SUCH REPRESENTATIONS HAVE BEEN MADE.
SELLER SPECIFICALLY DISCLAIMS, AND NEITHER IT NOR ANY OF ITS AFFILIATES
NOR ANY OTHER PERSON IS MAKING, ANY REPRESENTATION, WARRANTY OR ASSURANCE
WHATSOEVER TO PURCHASER, AND NO WARRANTIES OR REPRESENTATIONS OF ANY KIND OR
CHARACTER, EITHER EXPRESS OR IMPLIED, ARE MADE BY SELLER OR RELIED UPON BY
PURCHASER WITH RESPECT TO THE STATUS OF TITLE TO OR THE MAINTENANCE, REPAIR,
CONDITION, DESIGN OR MARKETABILITY OF THE PROPERTY, OR ANY PORTION THEREOF,
INCLUDING BUT NOT LIMITED TO (A) ANY IMPLIED OR EXPRESS WARRANTY OF
MERCHANTABILITY, (B) ANY IMPLIED OR EXPRESS WARRANTY OF FITNESS FOR A PARTICULAR
PURPOSE, (C) ANY IMPLIED OR EXPRESS WARRANTY OF CONFORMITY TO MODELS OR SAMPLES
OF MATERIALS, (D) ANY RIGHTS OF PURCHASER UNDER APPROPRIATE STATUTES TO CLAIM
DIMINUTION OF CONSIDERATION, (E) ANY CLAIM BY PURCHASER FOR DAMAGES BECAUSE OF
DEFECTS, WHETHER KNOWN OR UNKNOWN, WITH RESPECT TO THE IMPROVEMENTS OR THE
PERSONAL PROPERTY, (F) THE FINANCIAL CONDITION OR PROSPECTS OF THE PROPERTY AND
(G) THE COMPLIANCE OR LACK THEREOF OF THE REAL PROPERTY OR THE IMPROVEMENTS WITH
GOVERNMENTAL REGULATIONS, IT BEING THE EXPRESS INTENTION OF SELLER AND PURCHASER
THAT, EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, THE PROPERTY WILL BE
CONVEYED AND TRANSFERRED TO PURCHASER IN ITS PRESENT CONDITION AND STATE OF
REPAIR, "AS IS" AND "WHERE IS", WITH ALL FAULTS. PURCHASER REPRESENTS THAT IT IS
A KNOWLEDGEABLE, EXPERIENCED AND SOPHISTICATED PURCHASER OF REAL ESTATE, AND
THAT IT IS RELYING SOLELY ON ITS OWN EXPERTISE AND THAT OF PURCHASER'S
CONSULTANTS IN PURCHASING THE PROPERTY. PURCHASER HAS BEEN GIVEN A SUFFICIENT
OPPORTUNITY HEREIN TO CONDUCT AND HAS CONDUCTED OR WILL CONDUCT SUCH
INSPECTIONS, INVESTIGATIONS AND OTHER INDEPENDENT EXAMINATIONS OF THE PROPERTY
AND RELATED MATTERS AS PURCHASER DEEMS NECESSARY, INCLUDING BUT NOT LIMITED TO
THE PHYSICAL AND ENVIRONMENTAL CONDITIONS THEREOF, AND WILL RELY UPON SAME AND
NOT UPON ANY STATEMENTS OF SELLER (EXCLUDING THE LIMITED MATTERS REPRESENTED BY
SELLER IN SECTION 8.1 HEREOF) NOR OF ANY OFFICER, DIRECTOR, EMPLOYEE, AGENT OR
ATTORNEY OF SELLER. PURCHASER ACKNOWLEDGES THAT ALL INFORMATION OBTAINED BY
PURCHASER WAS OBTAINED FROM A VARIETY OF SOURCES, AND SELLER
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WILL NOT BE DEEMED TO HAVE REPRESENTED OR WARRANTED THE COMPLETENESS, TRUTH OR
ACCURACY OF ANY OF THE DOCUMENTS OR OTHER SUCH INFORMATION HERETOFORE OR
HEREAFTER FURNISHED TO PURCHASER. UPON CLOSING, PURCHASER WILL ASSUME THE RISK
THAT ADVERSE MATTERS, INCLUDING, BUT NOT LIMITED TO, ADVERSE PHYSICAL AND
ENVIRONMENTAL CONDITIONS, MAY NOT HAVE BEEN REVEALED BY PURCHASER'S INSPECTIONS
AND INVESTIGATIONS. PURCHASER ACKNOWLEDGES AND AGREES THAT UPON CLOSING, SELLER
WILL SELL AND CONVEY TO PURCHASER, AND PURCHASER WILL ACCEPT THE PROPERTY, "AS
IS, WHERE IS," WITH ALL FAULTS. PURCHASER FURTHER ACKNOWLEDGES AND AGREES THAT
THERE ARE NO ORAL AGREEMENTS, WARRANTIES OR REPRESENTATIONS, COLLATERAL TO OR
AFFECTING THE PROPERTY, BY SELLER, ANY AGENT OF SELLER OR ANY THIRD PARTY.
SELLER IS NOT LIABLE OR BOUND IN ANY MANNER BY ANY ORAL OR WRITTEN STATEMENTS,
REPRESENTATIONS OR INFORMATION PERTAINING TO THE PROPERTY FURNISHED BY ANY REAL
ESTATE BROKER, AGENT, EMPLOYEE, SERVANT OR OTHER PERSON, UNLESS THE SAME ARE
SPECIFICALLY SET FORTH OR REFERRED TO HEREIN. PURCHASER ACKNOWLEDGES THAT THE
PURCHASE PRICE REFLECTS THE "AS IS, WHERE IS" NATURE OF THIS SALE AND ANY
FAULTS, LIABILITIES, DEFECTS OR OTHER ADVERSE MATTERS THAT MAY BE ASSOCIATED
WITH THE PROPERTY. PURCHASER, WITH PURCHASER'S COUNSEL, HAS FULLY REVIEWED THE
DISCLAIMERS AND WAIVERS SET FORTH IN THIS AGREEMENT AND UNDERSTANDS THEIR
SIGNIFICANCE AND AGREES THAT THE DISCLAIMERS AND OTHER AGREEMENTS SET FORTH
HEREIN ARE AN INTEGRAL PART OF THIS AGREEMENT, AND THAT SELLER WOULD NOT HAVE
AGREED TO SELL THE PROPERTY TO PURCHASER FOR THE PURCHASE PRICE WITHOUT THE
DISCLAIMERS AND OTHER AGREEMENTS SET FORTH IN THIS AGREEMENT. THE TERMS AND
CONDITIONS OF THIS SECTION 5.4 WILL EXPRESSLY SURVIVE THE CLOSING, WILL NOT
MERGE WITH THE PROVISIONS OF ANY CLOSING DOCUMENTS AND ARE HEREBY DEEMED
INCORPORATED INTO THE DEED AS FULLY AS IF SET FORTH AT LENGTH THEREIN.
PURCHASER FURTHER COVENANTS AND AGREES NOT TO XXX SELLER, AND RELEASES
SELLER OF AND FROM AND WAIVES ANY CLAIM OR CAUSE OF ACTION THAT PURCHASER MAY
HAVE AGAINST SELLER UNDER ANY ENVIRONMENTAL LAW, NOW EXISTING OR HEREAFTER
ENACTED OR PROMULGATED, RELATING TO ENVIRONMENTAL MATTERS OR ENVIRONMENTAL
CONDITIONS EXISTING AS OF THE CLOSING (WHETHER KNOWN OR UNKNOWN) IN, ON, UNDER,
ABOUT OR MIGRATING FROM OR ONTO THE PROPERTY, INCLUDING, WITHOUT LIMITATION, THE
COMPREHENSIVE ENVIRONMENTAL RESPONSE, COMPENSATION AND LIABILITY ACT, OR BY
VIRTUE OF ANY COMMON LAW RIGHT RELATED TO ENVIRONMENTAL CONDITIONS OR
ENVIRONMENTAL MATTERS IN, ON, UNDER, ABOUT OR MIGRATING FROM OR ONTO THE
PREMISES. THE PROVISIONS OF THIS PARAGRAPH SHALL SURVIVE THE CLOSING OF TITLE TO
THE PROPERTY OR THE TERMINATION OF THIS AGREEMENT, AS THE
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CASE MAY BE. THE FOREGOING SENTENCE SHALL NOT RELIEVE SELLER OF ITS
REPRESENTATION MADE UNDER SECTION 8.1(J).
ARTICLE VI
TITLE AND SURVEY MATTERS
SECTION 6.1 SURVEY. Purchaser acknowledges receipt of a current ALTA
survey for the Property. Such current survey is herein referred to as the
"UPDATED SURVEY". Any matter revealed by the Updated Survey which Seller deems
unacceptable shall constitute a "SURVEY OBJECTION" under this Agreement.
SECTION 6.2 TITLE COMMITMENT.
(a) Purchaser acknowledges receipt from the Title Company of a
current title insurance commitment for the Property (the "TITLE COMMITMENT"),
together with copies of the title exceptions listed thereon and Seller's vesting
deed. By the date (the "OBJECTION DATE") which is twenty (20) days after the
Effective Date, Purchaser shall provide Seller with written notice of any Survey
Objections or objection to matters disclosed by the Title Commitment if
Purchaser deems same unacceptable (collectively, the "TITLE AND SURVEY
OBJECTIONS"). In the event Seller does not receive the Title and Survey
Objections by the Objection Date, Purchaser will be deemed to have accepted the
exceptions to title set forth in the Title Commitment as Permitted Exceptions.
Title and Survey Objections shall be handled in accordance with Section 6.3. The
Title Commitment shall provide that the Title Company agrees to issue to
Purchaser at Closing an owner's policy of title insurance (the "TITLE POLICY")
in the amount of the Purchase Price on the 1970 ALTA owner's form insuring
Purchaser's fee simple title to the Real Property, with all requirements
satisfied, subject to the terms of such policy and the exceptions described
therein, specifically excluding the standard or general exceptions, and
specifically excluding any Monetary Obligations (as hereinafter defined). All
matters shown on the Existing Survey which are not removed by Seller pursuant to
the provisions of Section 6.3 and the exceptions shown on EXHIBIT G which are
not removed by Seller pursuant to the provisions of Section 6.3 will be referred
to herein as the "PERMITTED EXCEPTIONS".
(b) All taxes, water rates or charges, sewer rents and
assessments, plus interest and penalties thereon, which on the Closing Date are
due and payable and/or are liens against the Real Property and which Seller is
obligated to pay and discharge will be credited against the Purchase Price
(subject to the provision for apportionment of taxes, water rates and sewer
rents herein contained) and without the need for Purchaser to raise as a Title
Objection.
(c) If on the Closing Date the Real Property shall be affected
by any lien which, pursuant to the provisions of this Agreement, is required to
be discharged or satisfied by Seller, Seller shall not be required to discharge
or satisfy the same of record provided the money necessary to satisfy the lien
is retained by the Title Company at Closing (with authority to pay in the event
of enforcement of such lien), and the Title Company either omits the lien as an
exception from the title insurance commitment or insures against collection
thereof from or out of the Real Property and/or the Improvements, and a credit
is given to Purchaser for the recording charges for a satisfaction or discharge
of such lien.
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(d) No franchise, transfer, inheritance, income, corporate or
other tax open, levied or imposed against Seller or any former owner of the
Property, that may be a lien against the Property on the Closing Date, shall be
an objection to title if the Title Company insures against collection thereof
from or out of the Real Property and/or the Improvements, and provided further
that Seller deposits with the Title Company a sum reasonably sufficient to
secure a release of the Real Property and/or Improvements from the lien thereof
(with authority to pay in the event of enforcement of such lien). If a search of
title discloses judgments, bankruptcies, or other returns against other persons
having names the same as or similar to that of Seller, Seller will deliver to
Purchaser an affidavit stating that such judgments, bankruptcies or other
returns do not apply to Seller, and such search results shall not be deemed
Title and Survey Objections.
(e) Notwithstanding anything to the contrary contained herein,
Seller shall be obligated to cure and/or satisfy or cause to be deleted as an
exception to title: (x) any standard exceptions (to the extent that the Title
Company is willing to delete the same based upon receipt of the Updated Survey
and an affidavit from Seller); (y) any of the following exceptions and
encumbrances to the title to the Property as may be disclosed by the Title
Commitment, all of which shall be referred to herein as "Monetary Objections":
(i) any deed of trust, mortgage, or other security title, assignment of leases,
negative pledge, financing statement or similar security instrument encumbering
all or any portion of the Property; (ii) mechanics, materialmen, brokers or
other similar liens affecting the Property (unless Tenant is obligated to remove
the same pursuant to the provisions of the Lease); (iii) the lien of ad valorem
taxes, and other similar items affecting the Property which are past due; (iv)
any judgment or lis pendens of record against Seller in the county or other
applicable jurisdiction in which the Property is located; and (z) any other
encumbrance first appearing of record after the effective date of the Title
Commitment. To the extent any Monetary Objection has not been cured or satisfied
at or prior to Closing, Purchaser shall be entitled to apply a portion of the
purchase proceeds to such satisfaction or cure (or withhold such portion as may
be necessary to satisfy or cure such Monetary Objection) and Purchaser shall
receive a credit against the Purchase Price for any such amounts so applied or
withheld. Notwithstanding the foregoing to the contrary, if on the Closing Date
there shall be security interests filed against the Real Property, such items
shall not be Monetary Obligations if (i) the personal property covered by such
security interests are no longer in or on the Real Property and will not be
conveyed as part of the Personal Property hereunder, or (ii) such personal
property is the property of Tenant, and Seller executes and delivers an
affidavit to such effect, or the security interest was filed more than five (5)
year prior to the Closing Date and was not renewed.
SECTION 6.3 TITLE DEFECT.
(a) In the event Seller receives any Survey Objection or Title
Objection (collectively and individually, a "TITLE DEFECT") within the time
periods required under Sections 6.1 and 6.2 above, Seller may elect (but shall
not be obligated) to attempt remove, or cause to be removed at its expense, any
such Title Defect, and shall provide Purchaser with notice, within five (5) days
of its receipt of any such objection, of its intention to cure or not to cure
such any such Title Defect. If Seller elects to attempt to cure any Title
Defect, the Closing Date shall be extended, for a period not to exceed sixty
(60) days, for the purpose of such removal. In the event that (i) Seller elects
not to attempt to cure any such Title Defect, or (ii) Seller is unable to cure
any such Title Defect within the period elected by Seller but not to exceed
sixty (60) days from the Closing Date, Seller shall so advise Purchaser and
Purchaser shall have the right to
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terminate this Agreement and receive a refund of the Xxxxxxx Money Deposit,
together with all interest which has accrued thereon, or to waive such Title
Defect and proceed to the Closing. Purchaser shall make such election within
five (5) days of receipt of Seller's notice. If Purchaser elects to proceed to
the Closing, any Title Defects waived by Purchaser shall be deemed Permitted
Exceptions. In any such event of termination, Purchaser shall promptly return
Purchaser's Information to Seller, after which neither party shall have any
further obligation to the other under this Agreement except for the Termination
Surviving Obligations.
(b) Notwithstanding any provision of this Article VI to the
contrary, Seller will be obligated to cure exceptions to title to the Property,
in the manner described above, relating to liens and security interests securing
any financings to Seller, and any mechanic's liens resulting from work at the
Property commissioned by Seller.
(c) Notwithstanding the foregoing, in the event further
updates are made to the Title Commitment or Updated Survey which reveal new
matters not shown on the previous version of the Title Commitment or Updated
Survey, Purchaser may give Seller notice of any additional Title and Survey
Objections based upon such new matters. Purchaser must object in writing to any
such new matters, if at all, before 5:00 p.m. (eastern standard time) on the
second (2nd) business day after receipt of an such updated Title Commitment or
Updated Survey first disclosing said new matters. In the event Purchaser so
notices Seller, such items shall be deemed to be Title and Survey Objections and
subject to the process for Title Defects set forth above.
ARTICLE VII
INTERIM OPERATING COVENANTS, ESTOPPELS, BOARD
APPROVAL AND POST-CLOSING MANAGEMENT
SECTION 7.1 INTERIM OPERATING COVENANTS. Seller covenants to Purchaser
that Seller will:
(a) OPERATIONS. From the Effective Date until Closing,
continue to operate, manage and maintain the Improvements in the ordinary course
of Seller's business and substantially in accordance with Seller's present
practice, subject to ordinary wear and tear and further subject to Article XI of
this Agreement.
(b) COMPLIANCE WITH GOVERNMENTAL REGULATIONS. From the
Effective Date until Closing, not knowingly take any action that Seller would
result in a failure to comply in all material respects with all Governmental
Regulations applicable to the Property and with all covenants, conditions,
restrictions, encumbrances and other title exception documents affecting the
Property, it being understood and agreed that prior to Closing, Seller will have
the right to contest any such Governmental Regulations and any such title
exception documents.
(c) SERVICE CONTRACTS. From the expiration of the Evaluation
Period until Closing, not enter into any service contract, unless such service
contract is terminable on thirty (30) days notice without penalty or unless
Purchaser consents thereto in writing, which approval will not be unreasonably
withheld, delayed or conditioned.
(d) NOTICES. To the extent received by Seller, from the
Effective Date until Closing, promptly deliver to Purchaser copies of written
default notices, notices of lawsuits and notices of violations affecting the
Property.
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(e) LEASE. From the Effective Date until Closing, Seller shall
not amend, modify, extend or terminate the Lease or enter into any other leases
or occupancy agreements without the Purchaser's prior consent, which consent may
be withheld in Purchaser's reasonable discretion. Seller will give prompt
written notice to Purchaser of any amendments to the Lease prior to expiration
of the Evaluation Period.
(f) STANDSTILL. From the Effective Date until Closing, Seller
shall not market the Property or any interest therein for sale or disposition to
any other party, Seller shall not solicit, negotiate or accept offers or
otherwise enter into any binding or non-binding agreement for a purchase,
financing or joint venture involving the Property or any interest therein with
any other person or entity and Seller shall not dispose of, convey, assign or
pledge any interest in the Property or any interest therein or otherwise enter
into any agreement affecting or encumbering or agreeing to dispose of, convey,
assign or pledge any interest the Property or any interest therein, which
agreement would be consummated prior to or otherwise the survive the Closing.
(f) FURTHER ENCUMBRANCES. Seller shall not further alter or
encumber in any way Seller's title to the Property after the date hereof without
the prior written consent of Purchaser.
SECTION 7.2 ESTOPPELS. It will be a condition to Closing that Seller
obtain from Tenant (the "Estoppel Certificate") an executed estoppel certificate
in the form required to be given pursuant to the Lease. Seller agrees to request
an estoppel certificate from Tenant in the form attached as Exhibit L, and also
a copy of Tenant's financial statements, but it shall only be condition to
Closing that the Estoppel Certificate be in the form prescribed by the Lease. No
later than five (5) Business Days after the Effective Date, Seller will request
Tenant to execute such Estoppel Certificate, and use good faith efforts to
obtain same. Seller shall not be in default of its obligations hereunder if
Tenant fails to deliver the Estoppel Certificate, or delivers an Estoppel
Certificate which is not in accordance with this Agreement.
SECTION 7.3 BOARD APPROVAL. It will be a condition to Closing that
Seller obtain approval from its Board of Directors to proceed to Closing. Seller
shall solicit such approval from its Board of Directors within five (5) Business
Days following the Effective Date. Failure by Seller to obtain said approval
shall not be deemed a default hereunder. In the event Seller's Board of
Directors denies approval to proceed to Closing, this Agreement shall be deemed
terminated and of no further force and effect, except for the Termination
Surviving Obligations, which shall survive any such termination, and the Xxxxxxx
Money Deposit and interest earned thereon shall be returned to Purchaser. If
Seller's Board of Directors denies approval, Seller agrees to reimburse
Purchaser for its reasonable and actual out-of-pocket expenses, including
reasonable attorneys' fees, incurred in connection with the negotiation of this
Agreement and the performance of Purchaser's diligence inspections, provided,
however, that in no event shall Seller be obligated to reimburse in excess of
$50,000.
SECTION 7.4 RIGHT OF FIRST OFFER. It will be a condition to Closing
that Seller obtain from Tenant a written waiver of its right of first offer
contained in Section 9 of the Addendum to the Lease with respect the sale
contemplated by this Agreement. No later than five (5) Business Days after the
Effective Date, Seller will request Tenant to execute such waiver, and use good
faith efforts to obtain same. If Tenant exercises its right of first offer,
Seller agrees to reimburse
15
Purchaser for its reasonable and actual out-of-pocket expenses, including
reasonable attorneys' fees, incurred in connection with the negotiation of this
Agreement and the performance of Purchaser's diligence inspections, provided,
however, that in no event shall Seller be obligated to reimburse in excess of
$50,000.
ARTICLE VIII
REPRESENTATIONS AND WARRANTIES
SECTION 8.1 SELLER'S REPRESENTATIONS AND WARRANTIES. Subject to the
limitations set forth in Section 8.3 of this Agreement, Seller represents and
warrants to Purchaser the following:
(a) STATUS. Seller is a limited partnership, duly organized
and validly existing under the laws of the State of Delaware.
(b) AUTHORITY. Subject to Section 7.3 above, the execution and
delivery of this Agreement and the performance of Seller's obligations hereunder
have been duly authorized by all necessary action on the part of Seller, and
this Agreement constitutes the legal, valid and binding obligation of Seller,
enforceable in accordance with its terms. The person signing this Agreement on
behalf of Seller has been duly authorized to sign and deliver this Agreement on
behalf of Seller.
(c) NON-CONTRAVENTION. The execution and delivery of this
Agreement by Seller and the consummation by Seller of the transactions
contemplated hereby will not violate any judgment, order, injunction, decree,
regulation or ruling of any court or Authority or conflict with, result in a
breach of, or constitute a default under the organizational documents of Seller,
any note or other evidence of indebtedness, any mortgage, deed of trust or
indenture, or any lease or other material agreement or instrument to which
Seller is a party or by which it is bound.
(d) CONSENTS. Subject to Section 7.3 above, no consent,
waiver, approval or authorization is required from any person or entity (that
has not already been obtained) in connection with the execution and delivery of
this Agreement by Seller or the performance by Seller of the transactions
contemplated hereby.
(e) SUITS AND PROCEEDINGS. Except as listed in EXHIBIT H,
there are no legal actions, suits or similar proceedings pending and served, or,
to Seller's Knowledge, threatened in writing against Seller or the Property
which (i) are not adequately covered by existing insurance and (ii) if adversely
determined, would materially and adversely affect the value of the Property, the
continued operations thereof, or Seller's ability to consummate the transactions
contemplated hereby.
(f) NON-FOREIGN ENTITY. Seller is not a "foreign person" or
"foreign corporation" as those terms are defined in the Internal Revenue Code of
1986, as amended, and the regulations promulgated thereunder.
(g) TENANT AND LEASE. To Seller's Knowledge, as of the date of
this Agreement, the only tenant with respect to the Property is TRW, Inc. The
Documents made available to Purchaser pursuant to Section 5.2 hereof include
true and correct copies of all of the leases affecting the Property. The Lease
has not been amended except by Addendum dated December 10, 1996.
16
(h) SERVICE CONTRACTS. To Seller's Knowledge there are no
service contracts, the terms of which will constitute an obligation upon
Purchaser or the Property after the Closing.
(i) LEGAL COMPLIANCE. To Seller's Knowledge, Seller has not
received any notices or citations of the violation of any zoning regulation or
directive of any Authority having jurisdiction relating to the Property or any
part thereof which would have a material adverse effect on a Property as
currently owned and occupied. To Seller's knowledge, Seller has not received any
written notification from any governmental or public authority that the Property
is in violation of any applicable fire, health, building, use, occupancy or
zoning laws where such violation remains outstanding and, if unaddressed, would
have a material adverse effect on the use of the Property as currently owned and
operated.
(j) ENVIRONMENTAL. Except as may be disclosed in any
environmental report provided as a Document, to Seller's Knowledge, Seller has
not received any written notice of any violation of any Environmental Law, nor,
to Seller's Knowledge, has Seller caused or asserted in writing that Tenant has
caused any violation of any Environmental Law.
(j) DUE DILIGENCE MATERIALS. All copies of the Documents and
any other documents furnished or to be furnished to Purchaser by Seller or on
its respective behalf in connection with the transaction contemplated hereby are
true and complete copies of the originals, which, to Seller's Knowledge, have
not been changed, modified or supplemented except as disclosed to Purchaser.
(k) CONDEMNATION. To Seller's Knowledge, there are no pending
or threatened condemnation proceedings which would affect the Property, or any
part thereof, nor any pending or threatened planned public improvements,
annexations, zoning or subdivision changes, or other adverse claims affecting
the Property.
(l) BANKRUPTCY. Seller has not (A) commenced a voluntary case,
or had entered against it a petition, for relief under any federal bankruptcy
act or any similar petition, order or decree under any federal or state law or
statute relative to bankruptcy, insolvency or other relief for debtors, (B)
caused, suffered or consented to the appointment of a receiver, trustee,
administrator, conservator, liquidator or similar official in any federal, state
or foreign judicial or non-judicial proceeding, to hold, administer and/or
liquidate all or substantially all of its assets, (C) made an assignment for the
benefit of creditors.
(m) TO SELLER'S KNOWLEDGE. Seller represents to Purchaser that
the individuals identified in the definition of "To Seller's Knowledge" in
Section 1.1 of this Agreement are the senior individuals employed by Xxxx Xxxx
Realty most likely to have present actual knowledge of the representations and
warranties made in this Agreement.
(n) TAXES. Except with respect to previous protests which are
not currently under consideration, Seller has not filed, and has not retained
anyone to file, notices of protests against, or to commence action to review,
real property tax assessments against the Property.
(o) LEASING COMMISSIONS; PERSONAL PROPERTY. The commission
obligations, if any, listed in Section 15 of the Lease are the only commission
agreements with
17
any brokers, agents or finders existing as of the Execution Date with respect to
the Lease which will be binding upon Purchaser and/or the Property following the
Closing Date. Neither Seller, nor to Seller's Knowledge, Pacifica Holding
Company, LLC, entered into an agreement with Xxxxx & Xxxxx documenting the terms
and conditions on which commissions would or would not be payable following the
Closing Date, except as may be set forth in Section 15 of the Lease. Further, to
Seller's Knowledge, Seller is not in possession of the "schedule of said Brokers
in effect at the time of the execution of this Lease" referenced in Section 15
of the Lease as it pertains to Xxxxx & Xxxxx. None of the personal property
located on the Property is leased by Seller and none of such property is
security for any financing of Seller.
SECTION 8.2 PURCHASER'S REPRESENTATIONS AND WARRANTIES. Purchaser
represents and warrants to Seller the following:
(a) STATUS. Purchaser is a duly organized and validly existing
under the laws of the State of GEORGIA.
(b) AUTHORITY. The execution and delivery of this Agreement
and the performance of Purchaser's obligations hereunder have been duly
authorized by all necessary action on the part of Purchaser and this Agreement
constitutes the legal, valid and binding obligation of Purchaser, enforceable in
accordance with its terms. The person signing this Agreement on behalf of
Purchaser has been duly authorized to sign and deliver this Agreement on behalf
of Purchaser.
(c) NON-CONTRAVENTION. The execution and delivery of this
Agreement by Purchaser and the consummation by Purchaser of the transactions
contemplated hereby will not violate any judgment, order, injunction, decree,
regulation or ruling of any court or Authority or conflict with, result in a
breach of or constitute a default under the organizational documents of
Purchaser, any note or other evidence of indebtedness, any mortgage, deed of
trust or indenture, or any lease or other material agreement or instrument to
which Purchaser is a party or by which it is bound.
(d) CONSENTS. No consent, waiver, approval or authorization is
required from any person or entity (that has not already been obtained) in
connection with the execution and delivery of this Agreement by Purchaser or the
performance by Purchaser of the transactions contemplated hereby.
SECTION 8.3 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. The
representations and warranties of Seller set forth in Sections 8.1(a) - 8.1(d)
and 8.1(o) shall survive the Closing indefinitely and shall not be subject to
the floor or to the cap set forth below. The representations and warranties of
Seller set forth in Section 8.1 (e) - 8.1(n) and the covenants set forth in
Section 7.1 will survive the Closing for a period of twelve (12) months.
Purchaser will not have any right to bring any action against Seller as a result
of any untruth or inaccuracy of such representations and warranties or any such
breach, unless and until the aggregate amount of all liability and losses
arising out of any such untruth or inaccuracy, or any such breach, exceeds
Twenty-Five Thousand Dollars ($25,000); and then only to the extent of such
excess. In addition, in no event will Seller's liability for all such breaches
exceed, in the aggregate, the sum of Two Million Dollars ($2,000,000). Seller
shall have no liability with respect to any of Seller's representations,
warranties and covenants herein if, prior to the Closing, Purchaser has
knowledge of any breach of a covenant of Seller herein, or Purchaser obtains
knowledge (from
18
whatever source, including, without limitation, any tenant estoppel
certificates, as a result of Purchaser's due diligence tests, investigations and
inspections of the Property, or written disclosure by Seller or Seller's agents
and employees) that contradicts any of Seller's representations and warranties
set forth above, and Purchaser nevertheless consummates the transaction
contemplated by this Agreement. The Closing Surviving Obligations and the
Termination Surviving Obligations will survive Closing without limitation unless
a specified period is otherwise provided in this Agreement. All other
representations, warranties, covenants and agreements made or undertaken by
Seller under this Agreement, unless otherwise specifically provided herein, will
not survive the Closing Date but will be merged into the Deed and other Closing
documents delivered at the Closing. Notwithstanding the foregoing or any other
contrary provision of this Agreement, from and after the Closing Seller agrees
to indemnify Purchaser and to hold Purchaser harmless from and against any and
all damages, claims and expenses arising as a result of (a) any violation of the
representation contained in Section 8.1(o) above, and (b) any claims made by
Pacifica Holding Company for any brokerage fees due with respect to the
extension of the term of the Lease or other commissionable events as set forth
in Section 15 of the Lease (other than claims arising pursuant to agreements
entered into hereafter by Purchaser or its successors). The agreement in the
immediately preceding sentence shall survive the Closing indefinitely.
ARTICLE IX
CONDITIONS PRECEDENT TO CLOSING
SECTION 9.1 CONDITIONS PRECEDENT TO OBLIGATION OF PURCHASER. The
obligation of Purchaser to consummate the transaction hereunder shall be subject
to the fulfillment on or before the Closing Date of all of the following
conditions, any or all of which may be waived by Purchaser in its sole
discretion:
(a) Seller shall have delivered to Purchaser all of the items
required to be delivered to Purchaser pursuant to the terms of this Agreement,
including but not limited to, those provided for in Section 10.3.
(b) All of the representations and warranties of Seller
contained in this Agreement shall be true and correct in all respects as of the
date of Closing (with appropriate modifications permitted under this Agreement
or not materially adverse to Purchaser).
(c) Seller shall have performed and observed, in all material
respects, all covenants and agreements of this Agreement to be performed and
observed by Seller as of the Closing Date.
(d) Receipt of the Title Policy (or an irrevocable commitment
to issue the same) in the form prescribed by Section 6.2 above, along with
Seller's delivery of such evidence (including, owner's affidavits and gap
indemnities) as the Title Company may reasonably require to issue the Title
Policy in such required form.
(e) Receipt of the Tenant Estoppel Certificate
If, by the date and time of Closing, any of the foregoing conditions
are not performed or satisfied for any reason whatsoever or, alternatively, are
not expressly waived by Purchaser in writing, Purchaser shall, in addition to
any other remedies it may be entitled to as set forth in
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Section 13.1 below, have the right to terminate this Agreement, whereupon the
Xxxxxxx Money shall be returned to Purchaser.
SECTION 9.2 CONDITIONS PRECEDENT TO OBLIGATION TO SELLER. The
obligation of Seller to consummate the transaction hereunder shall be subject to
the fulfillment on or before the date of Closing of all of the following
conditions, any or all of which may be waived by Seller in it sole discretion:
(a) Seller shall have received the Purchase Price as adjusted
pursuant to, and payable in the manner provided for, in this Agreement.
(b) Purchaser shall have delivered to Seller all of the items
required to be delivered to Seller pursuant to the terms of this Agreement,
including but not limited to, those provided for in Section 10.2.
(c) All of the representations and warranties of Purchaser
contained in this Agreement shall be true and correct in all respects as of the
date of Closing (with appropriate modifications permitted under this Agreement
or not materially adverse to Seller).
(d) Purchaser shall have performed and observed, in all
material respects, all covenants and agreements of this Agreement to be
performed and observed by Purchaser as of the Closing Date.
If by the date and time of Closing, any of the foregoing requirements or
conditions are not fully performed or satisfied or, alternatively, are not
expressly waived in writing, Seller shall, in addition to any other remedies it
may be entitled to as set forth in Section 13.2 below, have the right to
terminate this Agreement, whereupon the Xxxxxxx Money shall be returned to
Purchaser.
ARTICLE X
CLOSING
SECTION 10.1 CLOSING. The consummation of the transaction contemplated
by this Agreement by delivery of documents and payments of money shall take
place at 10:00 a.m. Eastern Time on the Closing Date at the offices of the
Escrow Agent. At Closing, the events set forth in this Article X will occur, it
being understood that the performance or tender of performance of all matters
set forth in this Article X are mutually concurrent conditions which may be
waived by the party for whose benefit they are intended. The acceptance of the
Deed by Purchaser shall be deemed to be full performance and discharge of each
and every agreement and obligation on the part of the Seller to be performed
hereunder unless otherwise specifically provided herein. The acceptance of the
Purchase Price by Seller shall be deemed to be full performance and discharge of
each and every agreement and obligation on the part of the Purchaser to be
performed hereunder unless otherwise specifically provided herein. The parties
agree to provide all of the documents required under Sections 10.2 and 10.3 to
the Escrow Agent, in escrow, at least one day prior to the Closing Date.
SECTION 10.2 PURCHASER'S CLOSING OBLIGATIONS. On the Closing Date,
Purchaser, at its sole cost and expense, will deliver the following items to
Seller at Closing as provided herein:
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(a) The Purchase Price, after all adjustments are made as
herein provided, by Federal Reserve wire transfer of immediately available
funds, in accordance with the timing and other requirements of Section 3.3;
(b) A counterpart original of the Assignment of Leases, duly
executed by Purchaser;
(c) A counterpart original of the Assignment, duly executed by
Purchaser;
(d) Evidence reasonably satisfactory to Seller that the person
executing the Assignment of Leases, the Assignment, and the Tenant Notice
Letters on behalf of Purchaser has full right, power and authority to do so;
(e) Form of written notice executed by Purchaser and to be
addressed and delivered to the Tenant by Purchaser in accordance with Section
10.6 herein, (i) acknowledging the sale of the Property to Purchaser, (ii)
acknowledging that Purchaser has received and that Purchaser is responsible for
the Security Deposit (specifying the exact amount of the Security Deposit) (iii)
indicating that rent should thereafter be paid to Purchaser and giving
instructions therefor, (iv) requesting Tenant to update its insurance to reflect
Purchaser as an additional insured or loss payee, as applicable, and (v)
providing Purchaser's address for notice purposes under the Lease (the "TENANT
NOTICE LETTERS");
(f) A counterpart original of the Closing Statement, duly
executed by Purchaser;
(g) A certificate, dated as of the date of Closing, stating
that the representations and warranties of Purchaser contained in Section 8.2
are true and correct in all respects as of the Closing Date; and
(h) Such other documents as may be reasonably necessary or
appropriate to effect the consummation of the transaction with is the subject of
this Agreement.
SECTION 10.3 SELLER'S CLOSING OBLIGATIONS. At the Closing, Seller will
deliver to Purchaser the following documents:
(a) A special warranty deed (the "DEED"), in the form
customarily delivered in commercial transactions involving the purchase and sale
of real property located in the State of Colorado, duly executed and
acknowledged by Seller, conveying to the Purchaser the Real Property and the
Improvements subject only to the Permitted Exceptions;
(b) A blanket assignment and xxxx of sale in the form attached
hereto as EXHIBIT C (the "XXXX OF SALE"), duly executed by Seller, assigning and
conveying to Purchaser, without representation or warranty, title to the
Personal Property;
(c) A counterpart original of an assignment and assumption of
the Seller's interest, as lessor, in the Leases and Security Deposits in the
form attached hereto as EXHIBIT B (the "ASSIGNMENT OF LEASES"), duly executed by
Seller, conveying and assigning to Purchaser all of Seller's right, title and
interest, as sublessor, in the Lease and Security Deposits;
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(d) A counterpart original of an assignment and assumption of
Seller's interest in the Licenses and Permits and the Intangible Property in the
form attached hereto as EXHIBIT A (the "ASSIGNMENT"), duly executed by Seller,
conveying and assigning to Purchaser all of Seller's right, title, and interest,
if any, in the Licenses and Permits and the Intangible Property;
(e) The Tenant Notice Letters, duly executed by Seller;
(f) Evidence reasonably satisfactory to Purchaser and Title
Company that the person executing the documents delivered by Seller pursuant to
this Section 10.3 on behalf of Seller has full right, power, and authority to do
so;
(g) A certificate in the form attached hereto as EXHIBIT I
("CERTIFICATE AS TO FOREIGN STATUS") certifying that Seller is not a "foreign
person" as defined in Section 1445 of the Internal Revenue Code of 1986, as
amended, as well as any form or other document required under applicable laws to
be executed by Seller in connection with any transfer tax applicable to the
transaction contemplated by this Agreement;
(h) To the extent in Seller's possession (and, if not, copies
of), the original Lease, and all original Licenses and Permits and Intangible
Property in Seller's control bearing on the Property;
(i) A counterpart original of the Closing Statement, duly
executed by Seller;
(j) copies of any operating files maintained by Seller or its
property manager in connection with the leasing, maintenance, and/or management
of the Property, including, without limitation, operating agreements, insurance
policies, bills, invoices, receipts, real estate tax records (including, without
limitation copies of the tax statements on the Real Property, Improvements and
Personal Property for the immediately preceding two (2) years) and information
and other general records relating to the income and expenses of the Property.
(k) The Tenant Estoppel Certificate.
(l) A certificate, dated as of the date of Closing, stating
that the representations and warranties of Seller contained in Section 8.1(a) -
8.1(d), and 8.1(o) are true and correct in all respects as of the Closing Date.
A certificate, dated as of the date of Closing, stating that the representations
and warranties of Seller contained in Section 8.1 (f) - 8.1(n) are true and
correct in all respects as of the Closing Date (with appropriate modifications
to reflect any changes therein) or identifying any representation or warranty
which is not, or no longer is, true and correct and explaining the state of
facts giving rise to the change. In no event shall Seller be liable to Purchaser
for, or be deemed to be in default hereunder if any representation or warranty
was true and correct as of the Effective Date but is not, as of the Closing Date
and due to factors beyond Seller's control, true and correct in all respects;
PROVIDED, HOWEVER, that such event shall constitute the non-fulfillment of the
condition set forth in Section 9.1(b). If such representations and warranties
are not true and correct due to factors within Seller's control, Seller shall be
deemed to be in default hereunder, entitling Purchaser to the remedies set forth
in Section 13.1 hereof. If, despite changes or other matters described in such
certificate, the Closing occurs, Seller's representations and warranties set
forth in this Agreement shall be deemed to have been modified by all statements
made in such certificate.
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(m) Such other documents as may be reasonably necessary or
appropriate to effect the consummation of the transaction which is the subject
of this Agreement.
SECTION 10.4 PRORATIONS.
(a) Seller and Purchaser agree to adjust, as of 11:59 p.m. on
the day preceding the Closing Date (the "PRORATION TIME"), the following
(collectively, the "PRORATION ITEMS"):
(i) Rents, in accordance with Subsection 10.4(b)
below.
(ii) Cash Security Deposits and any prepaid rents,
together with interest required to be paid thereon.
(iii) Utility charges payable by Seller, including,
without limitation, electricity, water charges and sewer charges. If there are
meters on the Real Property, Seller will cause readings of all said meters to be
performed not more than five (5) days prior to the Closing Date, and a per diem
adjustment shall be made for the days between the meter reading date and the
Closing Date based on the most recent meter reading.
(iv) Real estate taxes due and payable for the
calendar year. If the Closing Date shall occur before the tax rate is fixed, the
apportionment of real estate taxes shall be upon the basis of the tax rate for
the preceding year applied to the latest assessed valuation. If subsequent to
the Closing Date, real estate taxes (by reason of change in either assessment or
rate or for any other reason) for the Real Property should be determined to be
higher or lower than those that are apportioned, a new computation shall be
made, and Seller agrees to pay Purchaser any increase shown by such
recomputation and vice versa.
(v) Such other items of income and expense as are
typically prorated at closing similar to the transaction contemplated by this
Agreement.
Seller will be charged and credited for the amounts of all of
the Proration Items relating to the period up to and including the Proration
Time, and Purchaser will be charged and credited for all of the Proration Items
relating to the period after the Proration Time. The estimated Closing
prorations shall be set forth on a preliminary closing statement to be prepared
by Seller and submitted to Purchaser two (2) days prior to the Closing Date (the
"CLOSING STATEMENT"). The Closing Statement, once agreed upon, shall be signed
by Purchaser and Seller. The proration shall be paid at Closing by Purchaser to
Seller (if the prorations result in a net credit to Seller) or by Seller to
Purchaser (if the prorations result in a net credit to Purchaser) by increasing
or reducing the cash to be delivered by Purchaser in payment of the Purchase
Price at the Closing. If the actual amounts of the Proration Items are not known
as of the Closing Date, the prorations will be made at Closing on the basis of
the best evidence then available; thereafter, when actual figures are received,
re-prorations will be made on the basis of the actual figures, and a final cash
settlement will be made between Seller and Purchaser. No prorations will be made
in relation to insurance premiums, and Seller's insurance policies will not be
assigned to Purchaser. Final readings and final xxxxxxxx for utilities will be
made if possible as of the Closing Date, in which event no proration will be
made at the Closing with respect to utility bills. Seller will be entitled to
all deposits presently in effect with the utility providers, and Purchaser will
be
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obligated to make its own arrangements for any deposits with the utility
providers, but Seller will, if necessary, maintain such deposits until such time
as Purchaser can post its own deposits (but in no event longer than thirty (30)
days after Closing) so that such utility service will not be discontinued to the
Property. The provisions of this Section 10.4(a) will survive the Closing for
twelve (12) months.
(b) Purchaser will receive a credit on the Closing Statement
for the prorated amount (as of the Proration Time) of all Rental previously paid
to or collected by Seller and attributable to any period following the Proration
Time. After the Closing, Seller will cause to be paid or turned over to
Purchaser all Rental, if any, received by Seller after Closing and attributable
to any period following the Proration Time. "RENTAL" as used herein includes
fixed monthly rentals, additional rentals, percentage rentals, escalation
rentals (which include Tenant's share of building operation and maintenance
costs and expenses as provided for under the Lease, to the extent the same
exceeds any expense stop specified in such Lease), retroactive rentals, all
administrative charges, utility charges, tenant or real property association
dues, storage rentals, special event proceeds, temporary rents, telephone
receipts, locker rentals, vending machine receipts and other sums and charges
payable by Tenant under the Lease or from other occupants or users of the
Property. Rental is "DELINQUENT" when it was due prior to the Closing Date, and
payment thereof has not been made on or before the Proration Time. Delinquent
Rental will not be prorated. Purchaser agrees to use good faith collection
procedures with respect to the collection of any Delinquent Rental, but
Purchaser will have no liability for the failure to collect any such amounts and
will not be required to pursue legal action to enforce collection of any such
amounts owed to Seller by Tenant. All sums collected by Purchaser from and after
Closing from Tenant (excluding tenant specific xxxxxxxx for tenant work orders
and other specific services as described in and governed by Section 10.4(d)
below) will be applied first to current amounts owed by such Tenant to Purchaser
and then to delinquencies owed by such Tenant to Seller. Any sums due Seller
will be promptly remitted to Seller.
(c) At the Closing, Seller shall deliver to Purchaser a list
of additional rent, however characterized, under the Lease, including without
limitation, real estate taxes, electrical charges, utility costs and operating
expenses (collectively, "OPERATING EXPENSES") billed to Tenant for the calendar
year in which the Closing occurs (both on a monthly basis and in the aggregate),
the basis on which the monthly amounts are being billed and the amounts incurred
by Seller on account of the components of Operating Expenses for such calendar
year. Upon the reconciliation by Purchaser of the Operating Expenses billed to
Tenant, and the amounts actually incurred for such calendar year, Seller and
Purchaser shall be liable for overpayments of Operating Expenses, and shall be
entitled to payments from Tenant, as the case may be, on a PRO-RATA basis based
upon each party's period of ownership during such calendar year.
(d) With respect to specific tenant xxxxxxxx for work orders,
special items performed or provided at the request of a Tenant or other specific
services, which are collected by Purchaser after the Closing Date but relate to
the foregoing specific services rendered by Seller prior to the Proration Time,
then notwithstanding anything to the contrary contained herein, Purchaser shall
cause the first amounts collected from Tenant specifically for such special
services (as opposed to regular scheduled rental payments) to be paid to Seller
on account thereof, so long as Seller identifies same prior to Closing.
(e) Notwithstanding any provision of this Section 10.4 to the
contrary, Purchaser will be solely responsible for any leasing commissions,
tenant improvement costs or
24
other expenditures due with respect to any amendments, renewals and/or
expansions of the Lease first arising, accruing and payable following the
Closing Date.
(f) Purchaser shall receive a credit for any taxes paid from
Tenant for any real estate taxes paid in advance by Tenant to Seller pursuant to
the operation of Section 10.1(b) of the Lease or otherwise.
SECTION 10.5 COSTS OF TITLE COMPANY AND CLOSING COSTS. Costs of the
Title Company and other Closing costs incurred in connection with the Closing
will be allocated as follows:
(a) Seller shall pay Seller's attorney's fees and one-half
(1/2) of escrow fees if any, will pay the base premium for the Title Policy, and
the cost of the Updated Survey. In addition, Seller shall pay the commission to
the Broker as set forth in Section 16.1 below.
(b) Purchaser shall pay (i) the costs of recording (including
documentary fees) the Deed to the Property and all other documents; (ii) the
cost of any additional coverage under the Title Policy or endorsements to the
Title Policy that are desired by Purchaser; (iii) all premiums and other costs
for any mortgagee policy of title insurance, if any, including but not limited
to any endorsements or deletions; (iv) Purchaser's attorney's fees; and (v)
one-half (1/2) of escrow fees, if any.
(c) Any other costs and expenses of Closing not provided for
in this Section 10.5 shall be allocated between Purchaser and Seller in
accordance with the custom in the area in which the Property is located.
SECTION 10.6 POST-CLOSING DELIVERY OF TENANT NOTICE LETTERS.
Immediately following Closing, Purchaser will deliver to Tenant a Tenant Notice
Letter, as described in Section 10.2(e).
SECTION 10.7 LIKE-KIND EXCHANGE. In the event that Seller shall elect
to effectuate the Closing as a "like-kind" exchange under Section 1031 of the
Code, Purchaser agrees to cooperate and assist Seller in all reasonable respects
(at no cost to Purchaser other than incidental attorneys' fees and with no
adjustment to the Evaluation Period or the Closing Date hereunder) in order that
the exchange so qualifies as a "like-kind" exchange under Section 1031 of the
Code and the Treasury Regulations promulgated, or to be promulgated, thereunder.
ARTICLE XI
CONDEMNATION AND CASUALTY
SECTION 11.1 CASUALTY. If, prior to the Closing Date, all or a
Significant Portion of the Real Property and Improvements is destroyed or
damaged by fire or other casualty, Seller will notify Purchaser of such
casualty. Purchaser will have the option to terminate this Agreement upon notice
to Seller given not later than fifteen (15) days after receipt of Seller's
notice. If this Agreement is terminated, the Xxxxxxx Money Deposit and all
interest accrued thereon will be returned to Purchaser and thereafter neither
Seller nor Purchaser will have any further rights or obligations to the other
hereunder except with respect to the Termination Surviving Obligations. If
Purchaser does not elect to terminate this Agreement or less than a Significant
Portion of the Real Property and Improvements is destroyed or damaged as
aforesaid, Seller will not be obligated to repair such damage or destruction but
(a) Seller will assign and turn over to Purchaser the insurance proceeds net of
reasonable collection costs (or if such have not been
25
awarded, all of its right, title and interest therein) payable with respect to
such fire or other casualty and (b) the parties will proceed to Closing pursuant
to the terms hereof without abatement of the Purchase Price, except that
Purchaser will receive credit for any insurance deductible amount. In the event
Seller elects to perform any repairs as a result of a casualty which can be
completed prior to Closing, Seller will be entitled to deduct its reasonable
costs and expenses from any amount to which Purchaser is entitled under this
Section 11.1, which right shall survive the Closing. Seller will have no right
to elect to perform any repairs after the Closing.
SECTION 11.2 CONDEMNATION OF PROPERTY.
(a) In the event of (i) any condemnation or sale in lieu of
condemnation of all of the Property; or (ii) any condemnation or sale in lieu of
condemnation of greater than $500,000.00, Purchaser will have the option, to be
exercised within fifteen (15) days after receipt of notice of such condemnation
or sale, of terminating Purchaser's obligations under this Agreement, or
electing to have this Agreement remain in full force and effect. In the event
that either (i) any condemnation or sale in lieu of condemnation of the Property
is for less than $500,000.00, or (ii) Purchaser does not terminate this
Agreement pursuant to the preceding sentence, Seller will assign to Purchaser
any and all claims for the proceeds of such condemnation or sale to the extent
the same are applicable to the Property, and Purchaser will take title to the
Property with the assignment of such proceeds and subject to such condemnation
and without reduction of the Purchase Price. Should Purchaser elect to terminate
Purchaser's obligations under this Agreement under the provisions of this
Section 11.3, the Xxxxxxx Money Deposit and any interest thereon will be
returned to Purchaser and neither Seller nor Purchaser will have any further
obligation under this Agreement, except for the Termination Surviving
Obligations. Notwithstanding anything to the contrary herein, if any eminent
domain or condemnation proceeding is instituted (or notice of same is given)
solely for the taking of any subsurface rights for utility easements or for any
right-of-way easement, and the surface may, after such taking, be used in
substantially the same manner as though such rights have not been taken,
Purchaser will not be entitled to terminate this Agreement as to any part of the
Property, but any award resulting therefrom will be assigned to Purchaser at
Closing and will be the exclusive property of Purchaser upon Closing.
ARTICLE XII
CONFIDENTIALITY
SECTION 12.1 CONFIDENTIALITY. Seller and Purchaser each expressly
acknowledge and agree that the transactions contemplated by this Agreement and
the terms, conditions, and negotiations concerning the same will be held in the
strictest confidence by each of them and will not be disclosed by either of them
except to their respective legal counsel, accountants, consultants, officers,
partners, directors, and shareholders or as otherwise permitted hereunder, and
except and only to the extent that such disclosure may be necessary or advisable
for their respective performances hereunder. Purchaser further acknowledges and
agrees that, unless and until the Closing occurs, all information obtained by
Purchaser in connection with the Property will not be disclosed by Purchaser to
any third persons (other than Licensee Parties) without the prior written
consent of Seller, unless such disclosure is required by law, rule or
regulation. Nothing contained in this Article XII will preclude or limit either
party to this Agreement from disclosing or accessing any information otherwise
deemed confidential under this Article XII or this Agreement in response to
lawful process or subpoena or other valid or enforceable order of a
26
court of competent jurisdiction or any filings with governmental authorities
required by reason of the transactions provided for herein pursuant to an
opinion of counsel. In addition, prior to or as a part of the Closing, any
release to the public of information with respect to the sale contemplated
herein or any matters set forth in this Agreement will be made only in the form
approved by Purchaser and Seller and their respective counsel, which approval
shall not be unreasonably withheld or delayed. The provisions of this Article
XII will survive the Closing or any termination of this Agreement.
ARTICLE XIII
REMEDIES
SECTION 13.1 DEFAULT BY SELLER. In the event the Closing and the
transactions contemplated hereby do not occur as herein provided by reason of
any default of Seller, Purchaser may, as Purchaser's sole and exclusive remedy,
elect by notice to Seller within ten (10) Business Days following the Closing
Date, either of the following: (a) terminate this Agreement, in which event
Purchaser will receive from the Escrow Agent the Xxxxxxx Money Deposit, together
with all interest accrued thereon, and Purchaser shall be entitled to obtain
appropriate actual damages; or (b) obtain specific performance of this Agreement
against Seller and recover from Seller the costs incurred by Purchaser in so
obtaining such specific performance. Purchaser shall be deemed to have elected
to terminate this Agreement and receive back the Xxxxxxx Money Deposit if
Purchaser fails to file suit for specific performance against Seller in a court
having jurisdiction in the county and state in which the Property is located, on
or before ninety (90) days following the Closing Date. Notwithstanding the
foregoing, nothing contained in this Section 13.1 will limit Purchaser's
remedies at law, in equity or as herein provided in pursuing remedies of a
breach by Seller of any of the Termination Surviving Obligations. Purchaser
specifically waives its rights to seek any punitive, speculative, or
consequential damages.
SECTION 13.2 DEFAULT BY PURCHASER. In the event the Closing and the
consummation of the transactions contemplated herein do not occur as provided
herein by reason of any default of Purchaser, Purchaser and Seller agree it
would be impractical and extremely difficult to fix the damages which Seller may
suffer. Purchaser and Seller hereby agree that (a) an amount equal to the
Xxxxxxx Money Deposit, together with all interest accrued thereon, is a
reasonable estimate of the total net detriment Seller would suffer in the event
Purchaser defaults and fails to complete the purchase of the Property, and (b)
such amount will be the full, agreed and liquidated damages for Purchaser's
default and failure to complete the purchase of the Property, and will be
Seller's sole and exclusive remedy (whether at law or in equity) for any default
of Purchaser resulting in the failure of consummation of the Closing, whereupon
this Agreement will terminate and Seller and Purchaser will have no further
rights or obligations hereunder, except with respect to the Termination
Surviving Obligations. The payment of such amount as liquidated damages is not
intended as a forfeiture or penalty but is intended to constitute liquidated
damages to Seller. Notwithstanding the foregoing, nothing contained herein will
limit Seller's remedies at law, in equity or as herein provided in the event of
a breach by Purchaser of any of the Termination Surviving Obligations.
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ARTICLE XIV
NOTICES
SECTION 14.1 NOTICES.
(a) All notices or other communications required or permitted
hereunder shall be in writing, and shall be given by any nationally recognized
overnight delivery service with proof of delivery, or by facsimile transmission
(provided that such facsimile is confirmed by the sender by overnight delivery
service in the manner previously described), sent to the intended addressee at
the address set forth below, or to such other address or to the attention of
such other person as the addressee will have designated by written notice sent
in accordance herewith. Unless changed in accordance with the preceding
sentence, the addresses for notices given pursuant to this Agreement will be as
follows:
If to Purchaser: Xxxxx Capital, Inc.
0000 Xxx Xxxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attn: Mr. L. Xxxx Xxxxx, Xx.
(000) 000-0000 (tele.)
(000) 000-0000(fax)
with a copy to: Xxxxxx & Bird LLP
One Atlantic Center
0000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000-0000
Attn: Xxxxxxx X. X'Xxxxxxxxx, Esq.
(000) 000-0000 (tele.)
((000) 000-0000(fax)
If Seller: c/o Xxxx-Xxxx Realty Corporation
00 Xxxxxxxx Xxxxx
Xxxxxxxx, Xxx Xxxxxx 00000
with separate notices to the attention of:
Xx. Xxxxxxxx X. Xxxxx
(000) 000-0000 (tele.)
(000) 000-0000 (fax)
and
Xxxxx X. Xxxxxx, Esq.
(000) 000-0000 (tele.)
(000) 000-0000 (fax)
With a copy to: Xxxxxx Xxxxx, Esq.
Xxxxxxxxxx Hyatt & Xxxxxx, PC
000 00xx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxxxxx 00000
(000)000-0000 (tele.)
(000)000-0000 (fax)
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If to Escrow Agent: Commonwealth Land Title Insurance Company
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxx Xxxxx
(000) 000-0000 (tele.)
(000) 000-0000 (fax)
(b) Notices given by (i) overnight delivery service as
aforesaid shall be deemed received and effective on the first business day
following such dispatch and (ii) facsimile transmission as aforesaid shall be
deemed given at the time and on the date of machine transmittal provided same is
sent and confirmation of receipt is received by the sender prior to 5:00 p.m.
(EST) on a Business Day (if sent later, then notice shall be deemed given on the
next Business Day). Notices may be given by counsel for the parties described
above, and such notices shall be deemed given by said party, for all purposes
hereunder
ARTICLE XV
ASSIGNMENT AND BINDING EFFECT
SECTION 15.1 ASSIGNMENT: BINDING EFFECT. Except as set forth below,
Purchaser will not have the right to assign this Agreement. Notwithstanding the
foregoing to the contrary, Purchaser may assign all of its rights under this
Agreement to an entity which directly or indirectly controls, is controlled by,
or is under common control with, Purchaser, including, without limitation, a
single purpose entity created by Purchaser for the purpose of holding title to
the Property. In the event of any such assignments, whether accomplished as a
matter of right or upon the consent of the other party, the original parties to
this Agreement shall not be released. This Agreement shall be binding upon and
inure to the benefit of the parties hereto, their respective heirs, successors
and assigns.
ARTICLE XVI
BROKERAGE
SECTION 16.1 BROKERS. Seller agrees to pay to Capital Development, LLC
(the "BROKER") a brokerage commission pursuant to a separate agreement by and
between Seller and Broker. Purchaser and Seller represent that they have not
dealt with any brokers, finders or salesmen, in connection with this transaction
other than Broker, and agree to indemnify, defend and hold each other harmless
from and against any and all loss, cost, damage, liability or expense, including
reasonable attorneys' fees, which either party may sustain, incur or be exposed
to by reason of any claim for fees or commissions made through the other party.
The provisions of this Article XVI will survive any Closing or termination of
this Agreement.
ARTICLE XVII
ESCROW AGENT
SECTION 17.1. ESCROW.
(a) Escrow Agent will hold the Xxxxxxx Money Deposit in escrow
in an interest bearing account of the type generally used by Escrow Agent for
the holding of escrow funds until the earlier of (i) the Closing, or (ii) the
termination of this Agreement in accordance with any right hereunder. In the
event Purchaser has not terminated this Agreement by the end of
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the Evaluation Period, the Xxxxxxx Money Deposit shall be non-refundable to
Purchaser, except as otherwise set forth herein, and shall be credited against
the Purchase Price at the Closing. All interest earned on the Xxxxxxx Money
Deposit shall be paid to the party entitled to the Xxxxxxx Money Deposit. In the
event this Agreement is terminated prior to the expiration of the Evaluation
Period, the Xxxxxxx Money Deposit and all interest accrued thereon will be
returned by the Escrow Agent to the Purchaser. In the event the Closing occurs,
the Xxxxxxx Money Deposit and all interest accrued thereon will be released to
Seller, and Purchaser shall receive a credit against the Purchase Price in the
amount of the Xxxxxxx Money Deposit, including the interest. In all other
instances, Escrow Agent shall not release the Xxxxxxx Money Deposit to either
party until Escrow Agent has been requested by Seller or Purchaser to release
the Xxxxxxx Money Deposit and has given the other party five (5) Business Days
to dispute the release of the Xxxxxxx Money Deposit. If no dispute is so
delivered, Escrow Agent shall disburse the Xxxxxxx Money Deposit as directed.
Purchaser represents that its tax identification number, for purposes of
reporting the interest earnings, is 00-0000000. Seller represents that its tax
identification number, for purposes of reporting the interest earnings, is
00-0000000.
(b) Escrow Agent shall not be liable to any party for any act
or omission, except for bad faith, gross negligence or willful misconduct, and
the parties agree to indemnify Escrow Agent and hold Escrow Agent harmless from
any and all claims, damages, losses or expenses arising in connection herewith.
The parties acknowledge that Escrow Agent is acting solely as stakeholder for
their mutual convenience. In the event Escrow Agent receives written notice of a
dispute between the parties with respect to the Xxxxxxx Money Deposit and the
interest earned thereon (the "ESCROWED FUNDS"), Escrow Agent shall not be bound
to release and deliver the Escrowed Funds to either party but may either (i)
continue to hold the Escrowed Funds until otherwise directed in a writing signed
by all parties hereto or (ii) deposit the Escrowed Funds with the clerk of any
court of competent jurisdiction. Upon such deposit, Escrow Agent will be
released from all duties and responsibilities hereunder. Escrow Agent shall have
the right to consult with separate counsel of its own choosing (if it deems such
consultation advisable) and shall not be liable for any action taken, suffered
or omitted by it in accordance with the advice of such counsel.
(c) Escrow Agent shall not be required to defend any legal
proceeding which may be instituted against it with respect to the Escrowed
Funds, the Property or the subject matter of this Agreement unless requested to
do so by Purchaser or Seller and is indemnified to its satisfaction against the
cost and expense of such defense. Escrow Agent shall not be required to
institute legal proceedings of any kind and shall have no responsibility for the
genuineness or validity of any document or other item deposited with it or the
collectibility of any check delivered in connection with this Agreement. Escrow
Agent shall be fully protected in acting in accordance with any written
instructions given to it hereunder and believed by it to have been signed by the
proper parties.
ARTICLE XVIII
MISCELLANEOUS
SECTION 18.1 WAIVERS. No waiver of any breach of any covenant or
provisions contained herein will be deemed a waiver of any preceding or
succeeding breach thereof, or of any other covenant or provision contained
herein. No extension of time for performance of any obligation or act will be
deemed an extension of the time for performance of any other obligation or act.
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SECTION 18.2 RECOVERY OF CERTAIN FEES. In the event a party hereto
files any action or suit against another party hereto by reason of any breach of
any of the covenants, agreements or provisions contained in this Agreement, then
in that event the prevailing party will be entitled to have and recover certain
fees from the other party including all reasonable attorneys' fees and costs
resulting therefrom. For purposes of this Agreement, the term "attorneys' fees"
or "attorneys' fees and costs" shall mean the fees and expenses of counsel to
the parties hereto, which may include printing, photoscopying, duplicating and
other expenses, air freight charges, and fees billed for law clerks, paralegals
and other persons not admitted to the bar but performing services under the
supervision of an attorney, and the costs and fees incurred in connection with
the enforcement or collection of any judgment obtained in any such proceeding.
The provisions of this Section 18.2 shall survive the entry of any judgment, and
shall not merge, or be deemed to have merged, into any judgment.
SECTION 18.3 CONSTRUCTION. Headings at the beginning of each article
and section are solely for the convenience of the parties and are not a part of
this Agreement. Whenever required by the context of this Agreement, the singular
will include the plural and the masculine will include the feminine and vice
versa. This Agreement will not be construed as if it had been prepared by one of
the parties, but rather as if both parties had prepared the same. All exhibits
and schedules referred to in this Agreement are attached and incorporated by
this reference, and any capitalized term used in any exhibit or schedule which
is not defined in such exhibit or schedule will have the meaning attributable to
such term in the body of this Agreement. In the event the date on which
Purchaser or Seller is required to take any action under the terms of this
Agreement is not a Business Day, the action will be taken on the next succeeding
Business Day.
SECTION 18.4 COUNTERPARTS. This Agreement may be executed in multiple
counterparts, each of which, when assembled to include an original signature for
each party contemplated to sign this Agreement, will constitute a complete and
fully executed original. All such fully executed original counterparts will
collectively constitute a single agreement.
SECTION 18.5 SEVERABILITY. If any term or other provision of this
Agreement is invalid, illegal, or incapable of being enforced by any rule of law
or public policy, all of the other conditions and provisions of this Agreement
will nevertheless remain in full force and effect, so long as the economic or
legal substance of the transactions contemplated hereby is not affected in any
adverse manner to either party. Upon such determination that any term or other
provision is invalid, illegal, or incapable of being enforced, the parties
hereto will negotiate in good faith to modify this Agreement so as to reflect
the original intent of the parties as closely as possible in an acceptable
manner to the end that the transactions contemplated hereby are fulfilled to the
extent possible.
SECTION 18.6 ENTIRE AGREEMENT. This Agreement is the final expression
of, and contains the entire agreement between, the parties with respect to the
subject matter hereof, and supersedes all prior understandings with respect
thereto. This Agreement may not be modified, changed, supplemented or
terminated, nor may any obligations hereunder be waived, except by written
instrument, signed by the party to be charged or by its agent duly authorized in
writing, or as otherwise expressly permitted herein.
SECTION 18.7 GOVERNING LAW. THIS AGREEMENT WILL BE CONSTRUED, PERFORMED
AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE IN
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WHICH THE PROPERTY IS LOCATED. SELLER AND PURCHASER HEREBY IRREVOCABLY SUBMIT TO
THE JURISDICTION OF ANY STATE OR FEDERAL COURT SITTING IN THE STATE IN WHICH THE
PROPERTY IS LOCATED IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO
THIS AGREEMENT AND HEREBY IRREVOCABLY AGREE THAT ALL CLAIMS IN RESPECT OF SUCH
ACTION OR PROCEEDING SHALL BE HEARD AND DETERMINED IN A STATE OR FEDERAL COURT
SITTING IN THE STATE IN WHICH THE PROPERTY IS LOCATED.
SECTION 18.8 NO RECORDING. The parties hereto agree that neither this
Agreement nor any affidavit or memorandum concerning it will be recorded and any
recording of this Agreement or any such affidavit or memorandum by Purchaser
will be deemed a default by Purchaser hereunder.
SECTION 18.9 FURTHER ACTIONS. The parties agree to execute such
instructions to the Title Company and such other instruments and to do such
further acts as may be reasonably necessary to carry out the provisions of this
Agreement.
SECTION 18.10 EXHIBITS. The following sets forth a list of Exhibits to
the Agreement:
Exhibit A - Assignment
Exhibit B - Assignment of Leases
Exhibit C - Xxxx of Sale
Exhibit D - Legal Description of Real Property
Exhibit E - Intentionally Deleted
Exhibit F - Intentionally Deleted
Exhibit G - Exceptions to Seller's Title
Exhibit H - Suits and Proceedings
Exhibit I - Certificate as to Foreign Status
Exhibit J - List of Personal Property
Exhibit K - Intentionally Deleted
Exhibit L - Form of Tenant Estoppel Certificate
SECTION 18.11 NO PARTNERSHIP. Notwithstanding anything to the contrary
contained herein, this Agreement shall not be deemed or construed to make the
parties hereto partners or joint venturers, it being the intention of the
parties to merely create the relationship of Seller and Purchaser with respect
to the Property to be conveyed as contemplated hereby.
SECTION 18.12 LIMITATIONS ON BENEFITS. It is the explicit intention of
Purchaser and Seller that no person or entity other than Purchaser and Seller
and their permitted successors and assigns is or shall be entitled to bring any
action to enforce any provision of this Agreement against any of the parties
hereto, and the covenants, undertakings and agreements set forth in this
Agreement shall be solely for the benefit of, and shall be enforceable only by,
Purchaser and Seller or their respective successors and assigns as permitted
hereunder. Nothing contained in this Agreement shall under any circumstances
whatsoever be deemed or construed, or be interpreted, as making any third party
(including, without limitation, Broker) a beneficiary of any term or provision
of this Agreement or any instrument or document delivered pursuant hereto, and
Purchaser and Seller expressly reject any such intent, construction or
interpretation of this Agreement.
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SECTION 18.13 REMEDIES CUMULATIVE. Except as provided in Section 13
above, all rights, powers and privileges conferred hereunder upon the parties in
any specific Section shall be cumulative but not restrictive of those given in
other Sections of this Agreement and by law.
SECTION 18.14 TIME OF ESSENCE. Time is of the essence in complying with
the terms, conditions and agreements of this Agreement.
SECTION 18.15 FURTHER ASSURANCES. At and after Closing, the parties
shall deliver to each other any additional materials and documents which are
necessary or appropriate to further assure, complete and document the
consummation of the purchase and sale contemplated herein on the terms described
herein. From and after Closing, each party shall afford to the other reasonable
access to any information in its possession concerning the operations of the
Property (including the right to copy the same at the expense of the party
desiring the copy) for purposes of ascertaining post-Closing adjustments, tax
examinations or audits, or other similar purposes.
SECTION 18.16 COOPERATION. Seller acknowledges that Purchaser may be
required by the Securities and Exchange Commission to file audited financial
statement for one to three years with regard to the Property. At no cost or
liability to Seller, Seller shall cooperate with Purchaser, its counsel,
accountants, agents and representatives, provide them with access to Seller's
books and record with respect to the ownership, management, maintenance and
operation of the Property for the applicable period, and permit them to copy
same. Purchaser agrees to deliver to Seller a commercially reasonable
confidentiality agreement in connection with the foregoing.
IN WITNESS WHEREOF, Seller and Purchaser have respectively executed
this Agreement as of the Effective Date.
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Date Executed: PURCHASER:
May 13, 2002 XXXXX CAPITAL, INC.,
a Georgia corporation
By: /s/ Xxxxxxx X. Xxxxxxxx
--------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
------------------------------------
Title: Senior Vice President
-----------------------------------
SELLER:
May 14, 2002 XXXX-XXXX REALTY, L.P., a Delaware
limited partnership
By: XXXX-XXXX REALTY
CORPORATION, a Delaware
corporation, general partner
By: /s/ Xxxxx X. Xxxxxx
-----------------------------
Title: Executive Vice President
---------------------------
AS TO ARTICLE XVII ONLY:
ESCROW AGENT:
May 14, 2002 Commonwealth Land Title Insurance Company
By: /s/ Xxxxx Xxxxx
--------------------------------------
Name: Xxxxx Xxxxx
------------------------------------
Title: Vice President
-----------------------------------
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