AGREEMENT OF PURCHASE AND SALE
BY AND BETWEEN
ARDEN REALTY LIMITED PARTNERSHIP,
a Maryland limited partnership ("BUYER")
AND
PROPERTY ASSET MANAGEMENT INC.,
a Delaware corporation ("SELLER")
TABLE OF CONTENTS
Page
1. Certain Basic Definitions
2. Sale of Property: Purchase Price
3. Escrow: Closing Conditions.
4. Leasing.
5. Delivery and Possession
6. Commissions
7. Damage or Destruction: Condemnation
8. Seller's Representations and Warranties
9. Buyer's Representations and Warranties
10. Default.
11. Waiver of Trial by Jury.
12. Attorney's Fees
13. Notices
14. Amendment; Complete Agreement
15. Governing Law
16. Severability.
17. Counterparts, Headings and Defined Terms
18. Time of the Essence
19. Waiver.
20. Third Parties
21. Additional Documents
22. Independent Counsel
23. Condition of Property
24. No Warranties
25. Governmental Approvals
26. Release
27. Assignment
28. Successors and Assigns
29. Exhibits
30. No Reservation of Property.
31. Duty of Confidentiality
32. Audit Rights
AGREEMENT OF PURCHASE AND SALE
THIS AGREEMENT OF PURCHASE AND SALE ("Agreement") is made as of
November 22, 1996 ("Effective Date"), by and between ARDEN REALTY
LIMITED PARTNERSHIP, a Maryland limited partnership ("Buyer") and
PROPERTY ASSET MANAGEMENT INC., a Delaware corporation (together
with its successors and assigns, collectively, "Seller").
For valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, Buyer and Seller agree as follows:
AGREEMENT
1. Certain Basic Definitions. For purposes of this
Agreement, the following terms shall have the following
definitions:
1.1 Buyer's Address means 0000 Xxxxxxxx Xxxxxxxxx,
Xxxxx 000 Xxxx, Xxxxxxx Xxxxx, XX 00000.
1.2 Close of Escrow. The date the Escrow (as hereinafter
defined) closes.
1.3 Closing Date means the date the close of escrow occurs,
which shall be November 26, 1996.
1.4 Contingency Period means the period commencing on the
Effective Date and expiring at 5:00 P.M., Pacific Standard Time,
on November 25, 1996.
1.5 Deposit means the amount of One Hundred Thousand
Dollars ($100,000).
1.6 Escrow Holder means the Walnut Creek, California office
of First American Title Insurance Company.
1.7 Escrow Holder's Address means 0000 Xx. Xxxxxx Xxxx.,
Xxxxx 000, Xxxxxx Xxxxx, Xxxxxxxxxx 00000.
1.8 Purchase Price means the sum of Thirteen Million
Dollars ($13,000,000).
1.9 Real Property means the real property known as 000 X.
Xxxxxxxx Xxxx. and 000 Xx. Xxxxxxxx Xxxx., Xxxxxxx, Xxxxxxxxxx,
which real property is more particularly described in
Exhibit "A".
1.10 Seller's Address means x/x XXXX Xxxxxxx Xxxxxxxx
Xxxxxxxxxxx, 000 Xxxxxxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxxxxxxx,
Xxxxxxxxxx 00000, Attention: Xxxxx Xxxxxxx.
2. Sale of Property: Purchase Price.
2.1 Sale of Property. Seller shall sell the Real Property
and all buildings and other improvements located on the Real
Property ("Improvements" and, together with the Real Property and
all right, title and interest of Seller in and to the Leases,
defined below, and in any supplies, furniture, fixtures and
equipment located on the Real Property and Improvements, are
collectively referred to herein as the "Property") to Buyer, and
Buyer shall purchase the Property from Seller, for the Purchase
Price on the terms and conditions of this Agreement.
2.2 Purchase Price. The Purchase Price shall be payable as
follows:
2.2.1 Deposit. The Deposit shall be delivered by Buyer
to Escrow Holder upon execution of this Agreement, in the form of
cash or cashier's check drawn on good and sufficient funds on a
federally insured bank in the State of California and made
payable to the order of Escrow Holder, and shall be deposited by
Escrow Holder pursuant to the provisions of Section 3.1. The
Deposit, plus accrued interest thereon, shall be refunded to
Buyer if any of the conditions in Section 3.3 are not satisfied
or waived by Buyer and Buyer notifies Seller and Escrow Holder in
writing that Buyer is terminating this Agreement pursuant to
Section 3.5 of this Agreement within one (1) calendar day after
the expiration of the Contingency Period. Upon the satisfaction
or waiver by Buyer of the conditions in Section 3.3, the Deposit
shall belong to Seller and immediately upon the Closing, Escrow
Holder shall pay Seller the amount of the Deposit without further
written instructions to Escrow Holder.
2.2.2 Balance. Buyer shall deposit into Escrow an
amount in immediately available federal funds equal to the
Purchase Price minus the Deposit during the period the Deposit
was in Escrow ("Cash Balance"), as reduced by the amount of any
credits due, or increased by the amount of any items chargeable
to, Buyer under this Agreement. Buyer shall deposit the Cash
Balance into Escrow in the form of immediately available federal
funds before the Closing Date (or such earlier date as is
required by Escrow Holder) such that Escrow Holder will be in a
position to disburse the cash proceeds to Seller on the Closing
Date.
2.3 Interest. All funds received from or for the account
of Buyer shall be deposited by Escrow Holder in an interest-
bearing account with a federally insured state or national bank
or savings and loan association ("Account") located in California
and approved in writing by Seller.
3. Escrow: Closing Conditions.
3.1 Escrow. Upon the execution of this Agreement by Buyer
and Seller, the parties shall open an escrow ("Escrow") for the
consummation of the sale of the Property to Buyer pursuant to the
terms of this Agreement. Not later than two (2) business days
prior to the Closing Date, Buyer and Seller shall each deposit
with Escrow Holder written instructions covering the Close of
Escrow. In the absence of such instructions, Escrow Holder shall
be authorized to invest the Deposit in accordance with
Section 2.3 above.
3.2 Closing Date. The Escrow shall close on the Closing
Date, provided that all conditions to the Close of Escrow set
forth in this Agreement have been satisfied or waived in writing
by the party intended to be benefitted thereby.
3.3 Buyer's Conditions to Closing. The Close of Escrow is
subject to and contingent on the satisfaction of the following
conditions:
3.3.1 Inspection. Buyer's approval of the physical
condition of the Property at Buyer's sole cost and expense within
the Contingency Period.
(a) Buyer shall have the right to commence Buyer's
physical inspection of the Property within three (3) business
days following the Effective Date upon two (2) business days
prior notice to Seller and after Seller's receipt of written
evidence that Buyer has procured the insurance required by
Section 3.3.1(c), which may be a certificate of insurance.
Buyer's physical inspection of the Property shall be conducted
during normal business hours at a time mutually acceptable to
Buyer and Seller. Such inspection shall be conducted in a manner
that does not disturb the present tenants and occupants of the
Property and Buyer and Buyer's agent shall perform inspections
only while accompanied by one or more representatives of Seller.
(b) Buyer acknowledges that prior to the expiration of
the Contingency Period: (i) Buyer has or will have conducted
such surveys and inspections, and made such boring, percolation,
geologic, environmental and soils tests and other studies of the
Property; and (ii) Seller has provided Buyer with adequate
opportunity to make such inspection of the Property (including an
inspection for zoning, land use, environmental and other laws,
regulations and restrictions) as Buyer has, in Buyer's
discretion, deemed necessary or advisable as a condition
precedent to Buyer's purchase of the Property and to determine
the physical, environmental and land use characteristics of the
Property, including without limitation, its subsurface) and its
suitability for Buyer's intended use.
(c) Buyer shall obtain or cause its consultants to
obtain, at Buyer's sole cost and expense prior to commencement of
any investigative activities on the Property, a policy of
commercial general liability insurance covering any and all
liability of Buyer and Seller with respect to or arising out of
any investigative activities. Such policy of insurance shall be
kept and maintained in force during the term of this Agreement
and so long thereafter as necessary to cover any claims of
damages suffered by persons or property resulting from any acts
or omissions of Buyer, Buyer's employees, agents, contractors,
suppliers, consultants or other related parties. Such policy of
insurance shall have liability limits of not less than Three
Million Dollars ($3,000,000) combined single limit per occurrence
for bodily injury, personal injury and property damage liability.
Such insurance policy shall name Seller as an additional insured
and shall be in form and substance and issued by an insurance
company licensed to do business in the State of California and
satisfactory to Seller.
(d) Buyer shall protect, indemnify, defend and hold
the Property, Seller and Seller's officers, directors,
shareholders, participants, affiliates, employees,
representatives, invitees, agents and contractors free and
harmless from and against any and all claims, damages, liens,
stop notices, liabilities, losses, costs and expenses, including
reasonable attorneys' fees and court costs, resulting from
Buyer's inspection and testing of the Property, including,
without limitation, repairing any and all damages to any portion
of the Property, arising out of or related (directly or
indirectly) to Buyer's conducting such inspections, surveys,
tests, and studies. Buyer shall keep the Property free and clear
of any mechanics' liens or materialmen's liens related to Buyer's
right of inspection and the activities contemplated by
Section 3.3.1. The Buyer's indemnification obligations set forth
herein shall survive the Close of Escrow and shall not be merged
with the Deed (as hereinafter defined) and shall survive the
termination of this Agreement and Escrow prior to the Close of
Escrow.
(e) It is understood by the parties that Seller does
not make any representation or warranty, express or implied, as
to the accuracy or completeness of any information contained in
Seller's files or in the documents produced by Seller, including,
without limitation, any environmental audit or report. Buyer
acknowledges that Seller and Seller's affiliates shall have no
responsibility for the contents and accuracy of such disclosures,
and Buyer agrees that the obligations of Seller in connection
with the purchase of the Property shall be governed by this
Agreement irrespective of the contents of any such disclosures or
the timing or delivery thereof.
3.3.2 Preliminary Title Report. Buyer's approval of
(i) a current extended coverage, owner's preliminary title report
for the Real Property issued by First American Title Insurance
Company ("Title Company") (which together with legible copies of
all exceptions are collectively referred to as the "PTR"), and
(ii) all exceptions to title described in Schedule B of the PTR.
(a) Within ten (10) calendar days after execution of
this Agreement, Seller shall deliver to Buyer a copy of the PTR.
If Buyer does not expressly object in writing to any exception or
other matter in the PTR by the end of the Contingency Period,
then Buyer shall be deemed to have approved the PTR and all
exceptions set forth therein. Buyer and Seller agree that Buyer
shall have until the end of the Contingency Period to review the
PTR in its entirety, including, without limitation, the legal
description of the Real Property and all title exceptions
referred to in the PTR. If Buyer disapproves of any item in the
PTR within the Contingency Period, then Buyer shall so notify
Seller in writing, specifying in detail the reasons for Buyer's
disapproval.
(b) If Buyer disapproves of any item in the PTR within
the Contingency Period, Buyer shall have the right either (i) to
waive such exceptions to title, and proceed to take title to the
Real Property subject to such exceptions, without any deduction
or offset in the Purchase Price, and without any cause of action
against Seller, or (ii) to terminate this Agreement and the
Escrow by giving written notice of such termination to Seller and
to Escrow Holder, on or before the end of the Contingency Period.
Buyer's failure to provide Seller or Escrow Holder with such
written notice of termination on or before the end of the
Contingency Period shall constitute Buyer's election under clause
(i) above.
3.3.3 Due Diligence Items. Buyer's approval of all Due
Diligence Items (as defined below) within the Contingency Period.
Seller shall deliver to Buyer or make available for Buyer's
review copies of the items ("Due Diligence Items") set forth in
Sections (a) through (h).
(a) Any building plans, drawings and specifications in
Seller's actual possession relating to the Property ("Building
Plans").
(b) All written rental agreements, leases and
occupancy agreements in Seller's actual possession currently
affecting the Property ("Leases").
(c) A rent statement ("Rent Statement") prepared by
Seller containing: (i) the current rental income and rent
payment dates under each of the Leases; (ii) the date through
which rent has been paid by each of the tenants ("Tenants") under
the Leases; (iii) the commencement and expiration date of each of
the Leases; and (iv) the amount of all deposits ("Tenant
Deposits") held by Seller under each of the Leases.
(d) All property management, landscaping, air
conditioning, janitorial and other service contracts relating to
the Property, if any, that are in Seller's actual possession and
that will remain in effect after the Closing ("Service
Contracts").
(e) PTR, as defined in Section 3.3.2.
(f) The Phase I environmental report dated August 24,
1995, prepared by ATEC Associates, Job No. 00-00-00000000
("Environmental Report").
(g) Any income statement or balance sheet, if any, in
Seller's actual possession, regarding the operation of the
Property ("Operating Statements").
(h) Any other documents in Seller's actual possession
reasonably requested in writing by Buyer that bind the Property
or materially affect its use, provided such documents are not
confidential, proprietary or privileged.
3.3.4 Estoppel Certificates.
Buyer's receipt of tenant estoppel certificates
substantially in the form of Exhibit "F" ("Tenant
Estoppel Certificates") for Tenants occupying 85% of
the square footage of the Improvements and by all
Tenants occupying 3,500 or more square feet therein on
or before the end of the Contingency Period. Buyer
hereby acknowledges that Buyer shall rely on the
information set forth in any Tenant Estoppel
Certificate and such information shall supersede the
information provided to Buyer in the Rent Statement.
3.4 Approval Procedure. Buyer shall notify Seller of
Buyer's disapproval, if at all, of the matters described in
Sections 3.3.1, 3.3.2, 3.3.3 and 3.3.4 by written notice
delivered to Seller and Escrow Holder within the applicable time
periods specified in such Sections, but in no event later than
the one (1) calendar day after the expiration of the Contingency
Period. Buyer's failure to disapprove any of the matters
described in Sections 3.3.1. 3.3.2, 3.3.3 and 3.3.4 in the manner
and within the applicable time periods provided for herein shall
be deemed Buyer's approval of such matter and waiver of such
condition.
3.5 Termination.
3.5.1 Termination Upon Disapproval. This Agreement
shall terminate at Buyer's option upon Buyer's disapproval of any
of the matters described in Sections 3.3.1, 3.3.2, 3.3.3 and
3.3.4, within the time period specified in such Section for such
approval, but in no event later than one (1) calendar day after
the expiration of the Contingency Period. In no event shall
Buyer have the right to disapprove any such item any later than
one (1) calendar day after the expiration of the Contingency
Period. Upon termination of this Agreement pursuant to this
Section 3.5.1: (a) each party shall promptly execute and deliver
to Escrow Holder such documents as Escrow Holder may reasonably
require to evidence such termination; (b) Escrow Holder shall
return all documents to the respective parties who delivered such
documents to Escrow; (c) Escrow Holder shall return all funds
deposited into Escrow by Buyer together with any accrued interest
on such funds; (d) Buyer shall pay Escrow Holder's title and
escrow cancellation fees; (e) Buyer shall return to Seller all
Due Diligence Items in Buyer's possession; (f) Buyer shall
deliver to Seller all reports generated by Buyer or at Buyer's
direction in connection with Buyer's due diligence; and
(g) except as provided in Section 1, the respective obligations
of Buyer and Seller under this Agreement shall terminate;
provided, however, notwithstanding the foregoing, Buyer's
indemnity obligations under Section 3.3.1(d) and Buyer's
obligations under Section 31 shall survive any such termination
of the Agreement, and the termination of this Agreement shall not
release any other indemnity obligation of Buyer.
3.5.2 Good Faith Determination. Buyer shall approve or
disapprove the matters described in Sections 3.3.1, 3.3.2, 3.3.3
and 3.3.4, according to the good faith judgment of Buyer.
3.6 Title and Title Insurance.
3.6.1 Deed. Seller shall convey title to the Real
Property and Improvements to Buyer by grant deed in the form of
Exhibit "B" attached hereto ("Grant Deed").
3.6.2 Assignment of Leases. Seller shall assign,
without recourse, to Buyer Seller's right, title and interest in
the Leases, subject to any rights of consent as provided therein,
pursuant to an assignment in the form of Exhibit "C" attached
hereto ("Assignment of Leases").
3.6.3 Assignment of Service Contracts. Seller shall
assign, without recourse, to Buyer, Seller's right, title and
interest in the Service Contracts, subject to any rights of
consent as provided therein, pursuant to an assignment in the
form of Exhibit "D" attached hereto ("Assignment of Service
Contracts").
3.6.4 Xxxx of Sale. Seller shall quitclaim, without
recourse, all of Seller's right, title and interest, if any, to
the tangible personal property owned by Seller and used in the
operation of the Property pursuant to a Xxxx of Sale in the form
of Exhibit "E" attached hereto ("Xxxx of Sale").
3.6.5 Buyer's Title Policy. At the Close of Escrow,
Escrow Holder shall cause the Title Company to issue to Buyer a
1987 ALTA Extended Coverage Owner's Policy of Title Insurance
("ALTA Title Policy") which:
(a) shall be written with liability in the amount of
the Purchase Price; and
(b) shall insure title to the Property, to be vested
in Buyer, subject only to the following exceptions ("Permitted
Exceptions"): (i) the standard printed exceptions set forth in
the Title Policy; (ii) general and special real property taxes
and assessments for the current fiscal year, a lien not yet due
and payable; (iii) the Leases; (iv) such other exceptions as
Buyer has approved or is deemed to have approved pursuant to
Section 3.3.2; and (v) any exceptions directly or indirectly
caused by Buyer.
3.6.6 ALTA Policy. Buyer shall pay for the difference
between the cost of the ALTA Policy and a 1988 CLTA Standard
Coverage Owner's Policy of Title Insurance ("Title Policy") and
for the cost of any other increase in the amount or scope of
title insurance if Buyer elects to increase the amount or scope
of title insurance coverage provided in the Title Policy. Buyer
shall pay for all endorsements not included in the Title Policy.
Buyer shall pay for the cost of any survey that the Title Company
requires for issuance of such ALTA Policy.
3.7 Closing Costs and Charges.
3.7.1 Seller's Costs. Seller shall pay (a) all expenses
and charges incurred in connection with the discharge of
delinquent taxes, if any, which may be required in order for the
Title Company to issue the Title Policy in accordance with
Section 3.6.5; (b) all documentary transfer taxes payable in
connection with the transfer of the Property; (c) the premium for
the Title Policy; and (d) one-half (1/2) of Escrow Holder's fees
in connection with the Escrow.
3.7.2 Buyer's Costs. Buyer shall pay (a) all recording
fees payable in connection with the transfer of the Property; and
(b) one-half (1/2) of Escrow Holder's fees in connection with the
Escrow.
3.7.3 Other Costs. All other costs, if any, shall be
apportioned in the customary manner for real property
transactions in the County where the Real Property is located.
3.21 Deposit of Documents and Funds by Seller. Not later
than two (2) business days prior to the Closing Date, Seller
shall deposit the following items into Escrow, each of which
shall be duly executed and acknowledged by Seller where
appropriate.
3.8.1 The Deed.
3.8.2 A counterpart of the Assignment of Leases.
3.8.3 A counterpart of the
Assignment of Service Contracts.
3.8.4 A counterpart of the Xxxx of Sale.
3.8.5 An affidavit sworn by an officer of
Seller to the effect that Seller is not a "foreign
person" as that term is defined in Section 1445(f)(3)
of the Internal Revenue Code of 1986, as amended, and
Sections 18805 and 26131 of the California Revenue and
Taxation Code, as amended ("Certification").
3.8.6 A Real Estate Withholding Exemption
Certificate, California Form 590-RE ("Exemption
Certificate").
3.8.7 Other documents that may reasonably be
required by Escrow Holder to close the Escrow in
accordance with this Agreement.
3.9 Deposit of Documents and Funds by Buyer. Not later
than two (2) business days prior to the Closing Date, Buyer shall
deposit the following items into Escrow, each of which shall be
duly executed and acknowledged by Buyer where appropriate:
3.9.1 The Cash Balance, reduced by the amount of any
credits due to Buyer under this Agreement, and increased by the
amount of all items chargeable to Buyer under this Agreement.
3.9.2 A counterpart of the Assignment of Leases.
3.9.3 A counterpart of the Assignment of Service
Contracts.
3.9.4 A counterpart of the Xxxx of Sale.
3.9.5 Other documents and funds that may reasonably be
required by Escrow Holder to close the Escrow in accordance with
this Agreement.
3.10 Delivery of Documents and Funds at Closing. Provided
that all conditions to Closing set forth in this Agreement have
been satisfied or, as to any condition not satisfied, waived by
the party intended to be benefitted thereby, on the Closing Date
Escrow Holder shall conduct the Closing by recording or
distributing the following documents and funds in the following
manner:
3.10.1 Recorded Documents. Record the Deed in the
Official Records of the County in which the Real Property is
located.
3.10.2 Buyer's Documents. Deliver to Buyer: (a) the
ALTA Policy; (b) the original Certification; (c) an original
counterpart of the Assignment of Leases, executed by Seller;
(d) an original counterpart of the Assignment of Service
Contracts, executed by Seller; (e) an original counterpart of the
Xxxx of Sale, executed by Seller; (f) the original Exemption
Certificate; and (g) an original counterpart and an endorsed copy
of the recorded Deed, executed by Seller.
3.10.3 Seller's Documents. Deliver to Seller: (a) an
original counterpart of the Assignment of Leases, executed by
Buyer; (b) an original counterpart of the Assignment of Service
Contracts, executed by Buyer; (c) an original counterpart of the
Xxxx of Sale, executed by Buyer; and (d) an original counterpart
and an endorsed copy of the recorded Deed executed by Buyer.
3.10.4 Purchase Price. Deliver to Seller the Purchase
Price, plus such other funds, if any, as may be due to Seller by
reason of credits under this Agreement, less all items chargeable
to Seller under this Agreement.
3.11 Prorations and Adjustments.
3.11.1 Taxes. Seller and Buyer shall prorate real
property taxes and assessments on the Real Property and
Improvements as of the Close of Escrow for the current fiscal
year based on the most current official real property tax
information available from the County Assessor's office where the
Real Property is located or other assessing authorities; or the
declarant or owners' association under any declaration of
covenants, conditions and restrictions encumbering the Real
Property. If real property tax and assessment figures for the
current fiscal year are not available, real property taxes shall
be prorated based on the real property taxes for the previous
fiscal year. Seller shall pay any real property taxes
attributable to the period of Seller's ownership of the Property.
Seller reserves the right to meet with governmental officials and
to contest any reassessment concerning or affecting Seller's
obligations under this Section 3.11.1.
3.11.2 Rent. Seller and Buyer shall prorate rental
income and all other amounts payable by Tenants under the Leases
based on the actual rental income that has been paid, and other
amounts that have been paid under the Leases (excluding
delinquent amounts) as shown in the Rent Statement as of the
Close of Escrow unless superseded by any information set forth in
any written notice from Seller to Escrow Holder and Buyer. In
the event that as of the Closing Date, any Tenant is delinquent
in the payment of rent, and reimbursements for common area
maintenance, operating expenses or real or personal property
taxes that accrued prior to the Closing Date, including such
amounts that have been billed but remain unpaid as at the Closing
Date, said delinquent sums shall remain the property of Seller
and no proration with respect thereto shall be made as of the
Close of Escrow. Buyer will use its best efforts to collect all
such delinquent sums and remit the balance thereof, if any, to
Seller. Buyer shall advise Seller of all such collection efforts
including sending Seller copies of all correspondence and memos
and similar documentation with respect thereto. Further, Seller
may and, if requested by Seller to do so, Buyer will, seek legal
relief on behalf of Seller for the collection of such delinquent
rent. Buyer shall not take or permit to be taken any action
which could compromise, settle, release or otherwise impair any
claim or right of Seller with respect to any such delinquent
sums.
3.11.3 Security Deposits. There shall be a credit or
adjustment against the Purchase Price for any Tenant Deposits
held by Seller as indicated on the Rent Statement.
3.11.4 Utilities and Other Expenses.
(a) Utilities. Seller shall notify all water, gas,
electric and other utility companies servicing the Real Property
and Improvements (collectively, "Utility Companies") of the sale
of the Property to Buyer and shall request that all Utility
Companies send Seller a final xxxx for the period ending on the
last day prior to the Close of Escrow. Buyer shall notify all
Utility Companies servicing the Real Property and Improvements
that as of the Close of Escrow, Buyer shall own the Property and
that all utility bills for the period commencing on the Close of
Escrow are to be sent to Buyer. In addition to the Purchase
Price, Buyer shall pay to Seller the amount of all utility
deposits that are on deposit with utility companies and Seller
shall assign to Buyer all of Seller's right, title and interest
in any such utility deposits. If any of the Utility Companies
sends Seller or Buyer a xxxx for a period in which the Close of
Escrow occurs, Buyer and Seller shall prorate such bills outside
the Escrow. In connection with such proration, it shall be
presumed that utility charges were uniformly incurred during the
billing period.
(b) Past Due Operating Expenses. Buyer and Seller
shall prorate outside of Escrow all past due expenses of
operating the Property which are applicable to any period prior
to the Close of Escrow in accordance with Section 3.11.2, based
upon actual days elapsed. Seller shall have the right to review
and copy Buyer's books and records in order to facilitate any
such proration or collection by either party.
3.11.5 Prorations. All prorations shall be made as of
the Close of Escrow on the basis of the actual days of the month
in which the Closing occurs. All rents, income and profits
derived from the Property, if any, along with all expenses (other
than taxes addressed in Section 3.11.1) shall be prorated at the
Closing with appropriate debits and credits to the accounts of
Buyer and Seller so that, as between Buyer and Seller, Seller
shall receive, as appropriate, all of the same to the extent duly
allocable to the period ending on the date immediately prior to
the Closing Date, and Buyer shall receive, as appropriate, all of
the same to the extent duly allocable to the period commencing
upon the Closing Date.
3.11.6 Credit for Roof. Buyer shall receive a credit
against the purchase price of Fifty Thousand Dollars ($50,000)
for repairs to be made by Buyer to the roof of the Improvements.
4. Leasing.
4.1 Leasing. Seller shall have the right to enter into any
proposed lease affecting the Property ("Proposed Lease") or to
modify any existing lease (a "Lease Modification"), subject to
Buyer's right of approval, as described below. Provided Buyer is
not in default under this Agreement, prior to signing each
Proposed Lease and prior to executing any Lease Modification,
Seller shall submit the Proposed Lease or Lease Modification to
Buyer for Buyer's approval, which approval shall not be
unreasonably withheld, conditioned or delayed. Buyer shall
notify Seller in writing of Buyer's approval or disapproval of
each Proposed Lease or Lease Modification submitted to Buyer
within five (5) business days after Buyer's receipt thereof.
Buyer's failure to disapprove any Proposed Lease or Lease
Modification in accordance with the procedure and within the five
(5) business day period specified in this Section 4.1 shall be
deemed to constitute Buyer's approval of such Proposed Lease or
Lease Modification. Any notice of disapproval of a Proposed
Lease or Lease Modification by Buyer shall set forth in detail
Buyer's specific objections thereto. Seller may submit a
Proposed Lease or Lease Modification to Buyer for approval after
Seller's execution thereof, provided the Proposed Lease or Lease
Modification contains appropriate conditions regarding Buyer's
approval of the Proposed Lease or Lease Modification.
4.2 Leasing After Closing Date. Notwithstanding anything
to the contrary contained in this Agreement, Seller shall have
the right without Buyer's approval to enter into any Proposed
Lease or Lease Modification if for any reason Escrow has not
closed by the Closing Date.
4.3 Leasing Expenses. All leasing expenses for Proposed
Leases or Lease Modifications entered into after the Effective
Date and approved by Buyer pursuant to Section 4.1 hereof
including for the completion of tenant improvements and payment
of tenant allowances and payment of broker's commission, shall be
prorated between Seller and Buyer so that, as between Buyer and
Seller, Seller shall bear as appropriate, all of the sums to the
extent duly allocable to the period ending on the date
immediately prior to the Closing Date, and Buyer shall bear, as
appropriate, all of the sums to the extent duly allocable to the
period commencing on the Closing Date. If Buyer disapproves any
Proposed Lease or Lease Modification, Seller nonetheless shall
have the right to execute any such Proposed Lease or Lease
Modification and Seller shall bear all leasing expenses in
connection therewith including, without limitation, leasing
commissions, tenant improvements and concessions (including those
due after the Close of Escrow). Upon the Close of Escrow, Buyer
shall assume all obligations of Seller under or in connection
with any of the Leases, regardless of when such obligations
actually arose, including for the completion of tenant
improvements and payment of tenant improvement allowances, and
payment of broker's commissions.
4.4 Operation of Property. Between the date of the
execution of this Agreement and the Closing, Seller shall:
(i) maintain the Property in its present condition, ordinary wear
and tear excepted; (ii) maintain all casualty, liability and
hazard insurance currently in force with respect to the Property;
and (iii) operate, manage and enter into contracts with respect
to the Property, in the same manner done by Seller prior to the
Effective Date, maintaining present services and sufficient
supplies and equipment for the operation and maintenance of the
Property in the same manner as prior to the Effective Date;
provided, however, that Seller shall not enter into any service
contract that cannot be terminated within thirty (30) days.
5. Delivery and Possession. Seller shall deliver
possession of the Property to Buyer at the Close of Escrow,
subject to the rights of the Tenants under the Leases.
6. Commissions. Buyer and Seller each represent and
warrant to the other that they are unaware of any commission,
finder's fee or brokerage fee arising out of the transactions
contemplated by this Agreement. Buyer shall indemnify and hold
Seller harmless from and against any and all liabilities, claims,
demands, damages, costs and expenses, including, without
limitation, reasonable attorneys' fees and court costs, in
connection with claims for any such commissions, finders' fees or
brokerage fees arising out of Buyer's conduct or the inaccuracy
of the foregoing representation and/or warranty of Buyer.
7. Damage or Destruction: Condemnation.
7.1 Uniform Act. This Agreement shall be governed by the
Uniform Vendor and Purchaser Risk Act as set forth in
Section 1662 of the California Civil Code ("Act") as supplemented
by this Section 7. For purposes of the Act, (a) a taking by
eminent domain of a portion of the Property shall be deemed to
affect a "material part" of the Property if the estimated value
of the portion of the Property taken exceeds ten percent (10%) of
the Purchase Price, and (b) the destruction of a "material part"
of the Property shall be deemed to mean an insured or uninsured
casualty to the Property following Buyer's inspection of the
Property and prior to the Close of Escrow having an estimated
cost of repair which equals or exceeds ten percent (10%) of the
Purchase Price.
7.2 Definitions. The phrase "estimated value" shall mean
an estimate obtained from a M.A.I. appraiser, who has at least
five (5) years experience evaluating property located in the
County where the Real Property is located, similar in nature and
function to that of the Property, selected by Seller and approved
by Buyer, and the phrase "estimated cost of repair" shall mean an
estimate obtained from an independent contractor selected by
Seller and approved by Buyer. Buyer shall not unreasonably
withhold, condition or delay Buyer's approval under this Section.
7.3 Notice; Credit to Buyer. Buyer shall have the right to
terminate this Agreement if all or a material part of the
Property is destroyed without fault of Buyer or a material part
of the Property is taken by eminent domain. Buyer shall give
written notice of Buyer's election to terminate this Agreement
under the Act within five (5) business days after Buyer first
learns of any damage to or condemnation of the Property which
entitles Buyer to terminate this Agreement. If Buyer does not
give such notice, then this Agreement shall remain in effect and
upon the Close of Escrow, Seller shall assign to Buyer (a) any
insurance proceeds payable with respect to such damage; or
(b) the entire award payable with respect to such condemnation
proceeding, whichever is applicable.
8. Seller's Representations and Warranties. Seller
represents and warrants to Buyer that as of the date of this
Agreement and as of the Closing Date:
8.1 Seller's Existence and Authority.
(a) Seller is duly organized, validly existing, and in good
standing under the laws of the state of its formation.
(b) Seller has the full power and authority to execute,
deliver and perform its obligations under this Agreement.
8.2 Section 1445(f) IRC. Seller is not a "foreign person"
within the meaning of Section 1445(f)(3) of the Internal Revenue
Code.
9. Buyer's Representations and Warranties. Buyer
represents and warrants to Seller that as of the date of this
Agreement and as of the Closing Date:
9.1 If Buyer is other than an individual, Buyer is duly
organized, validly existing, and in good standing under the laws
of the state of its formation.
9.2 Buyer has the full power and authority to execute,
deliver and perform Buyer's obligations under this Agreement.
9.3 This Agreement constitutes a legal, valid and binding
obligation of Buyer enforceable in accordance with its terms,
except as enforceability may be limited by the application of
bankruptcy, insolvency, reorganization, moratorium or similar
laws or by equitable principles affecting creditors' rights
generally or the rights of buyers and sellers of real or personal
property generally.
9.4 The execution, delivery and performance of Buyer's
obligations under this Agreement and the consummation of the
transactions contemplated hereby (i) will not result in a breach
or violation of any contract, commitment or restriction to which
Buyer is a party or by which Buyer is bound; and (ii) do not
require any consent, approval or other authorization of any
person, entity or authority not previously obtained.
10. Default.
10.1 Liquidated Damages - Deposit.
NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS
AGREEMENT, IF BUYER HAS NOT TERMINATED THIS AGREEMENT WITHIN
ONE (1) CALENDAR DAY AFTER THE EXPIRATION OF THE CONTINGENCY
PERIOD AND IF THE SALE OF THE PROPERTY TO BUYER IS NOT
CONSUMMATED FOR ANY REASON OTHER THAN SELLER'S DEFAULT UNDER
THIS AGREEMENT, SELLER SHALL BE ENTITLED TO RETAIN THE
DEPOSIT AND ALL INTEREST ACCRUED THEREON AS SELLER'S
LIQUIDATED DAMAGES. THE PARTIES AGREE THAT IT WOULD BE
IMPRACTICABLE AND EXTREMELY DIFFICULT TO ASCERTAIN THE
ACTUAL DAMAGES SUFFERED BY SELLER AS A RESULT OF BUYER'S
FAILURE TO COMPLETE THE PURCHASE OF THE PROPERTY PURSUANT TO
THIS AGREEMENT, AND THAT UNDER THE CIRCUMSTANCES EXISTING AS
OF THE DATE OF THIS AGREEMENT, THE LIQUIDATED DAMAGES
PROVIDED FOR IN THIS SECTION REPRESENTS A REASONABLE
ESTIMATE OF THE DAMAGES WHICH SELLER WILL INCUR AS A RESULT
OF SUCH FAILURE PRIOR TO THE EXPIRATION OF THE CONTINGENCY
PERIOD, PROVIDED, HOWEVER, THAT THIS PROVISION SHALL NOT
LIMIT SELLER'S RIGHT TO RECEIVE REIMBURSEMENT FOR ATTORNEYS'
FEES, NOR WAIVE OR AFFECT SELLER'S RIGHTS AND BUYER'S
OBLIGATIONS UNDER SECTIONS 3.3.1(D), 7, 26 AND/OR 31 OF THIS
AGREEMENT. THE PARTIES ACKNOWLEDGE THAT THE PAYMENT OF SUCH
LIQUIDATED DAMAGES IS NOT INTENDED AS A FORFEITURE OR
PENALTY WITHIN THE MEANING OF CALIFORNIA CIVIL CODE
SECTION 3275 OR 3369, BUT IS INTENDED TO CONSTITUTE
LIQUIDATED DAMAGES TO SELLER PURSUANT TO CALIFORNIA CIVIL
CODE SECTIONS 1671, 1676, AND 1677. THE PARTIES HAVE SET
FORTH THEIR INITIALS BELOW TO INDICATE THEIR AGREEMENT WITH
THE LIQUIDATED DAMAGES PROVISION CONTAINED IN THIS SECTION.
SELLER'S INITIALS:/s/ MW BUYER'S INITIALS: /s/ RSZ
10.1 Default by Seller. If the Property is not conveyed to
Buyer as and when required by the terms of this Agreement
solely by reason of a default by Seller, or if Seller should
otherwise be in default under this Agreement, Buyer shall
have such rights and remedies as may exist under this
agreement, or at law or in equity, including, without
limitation, the right to specific performance and/or
damages; provided, however, in no event shall Buyer have the
right to receive consequential damages or damages on account
of any lost profits.
10.2 No Contesting Liquidated Damages. As material
consideration to each party's agreement to the liquidated damages
provisions stated above, each party hereby agrees to waive any
and all rights whatsoever to contest the validity of the
liquidated damage provisions for any reason whatsoever,
including, but not limited to, that such provision was
unreasonable under circumstances existing at the time this
Agreement was made.
10.3 Remedies. If either party breaches its obligations
hereunder, then the other party may, without terminating this
Agreement, suspend performance until such breach is cured. If
Buyer breaches this Agreement, Seller may terminate this
Agreement and retain the Deposit as liquidated damages without
waiving any of Seller's other rights and remedies. The
obligations of Seller under this Agreement shall be without
recourse to the assets of any officer, shareholder, director, or
employee of Seller or any parent company, affiliate or subsidiary
of Seller.
11. Waiver of Trial by Jury. Seller and Buyer, to the
extent they may legally do so, hereby expressly waive any right
to trial by jury of any claim, demand, action, cause of action,
or proceeding arising under or with respect to this Agreement, or
in any way connected with, or related to, or incidental to, the
dealings of the parties hereto with respect to this Agreement or
the transactions related hereto or thereto, in each case whether
now existing or hereafter arising, and irrespective of whether
sounding in contract, tort, or otherwise. To the extent they may
legally do so, Seller and Buyer hereby agree that any such claim,
demand, action, cause of action, or proceeding shall be decided
by a court trial without a jury and that any party hereto may
file an original counterpart or a copy of this section with any
court as written evidence of the consent of the other party or
parties hereto to waiver of its or their right to trial by jury.
12. Attorney's Fees. If any action or proceeding or
arbitration is commenced by either party to enforce their rights
under this Agreement or to collect damages as a result of the
breach of any of the provisions of this Agreement, the prevailing
party in such action or proceeding or arbitration, including any
bankruptcy, insolvency or appellate proceedings, shall be
entitled to recover all reasonable costs and expenses, including,
without limitation, reasonable attorneys' fees and court costs,
in addition to any other relief awarded by the court or
arbitrator.
13. Notices. All notices, demands, approvals, and other
communications provided for in this Agreement shall be in writing
and shall be effective upon the earliest of the following to
occur: (a) when delivered to the recipient; or (b) three (3)
business days after deposit in a sealed envelope in the United
States mail, postage prepaid by registered or certified mail,
return receipt requested, addressed to the recipient as set forth
below. All notices to Seller shall be sent to Seller's Address.
All notices to Buyer shall be sent to Buyer's Address. All
notices to Escrow Holder shall be sent to Escrow Holder's
Address. If the date on which any notice to be given hereunder
falls on a Saturday, Sunday or legal holiday, then such date
shall automatically be extended to the next business day
immediately following such Saturday, Sunday or legal holiday.
The foregoing addresses may be changed by written notice given in
accordance with this Section 13.
14. Amendment; Complete Agreement. All amendments and
supplements to this Agreement must be in writing and executed by
Buyer and Seller. This Agreement contains the entire agreement
and understanding between Buyer and Seller concerning the subject
matter of this Agreement and supersedes all prior agreements,
terms, understandings, conditions, representations and
warranties, whether written or oral, made by Buyer or Seller
concerning the Property or the other matters which are the
subject of this Agreement. This Agreement has been drafted
through a joint effort of the parties and their counsel and,
therefore, shall not be construed in favor of or against either
of the parties.
15. Governing Law. This Agreement shall be governed by and
interpreted in accordance with the laws of the State of
California.
16. Severability. If any provision of this Agreement or
application thereof to any person or circumstance shall to any
extent be invalid or unenforceable, the remainder of this
Agreement (including the application of such provision to persons
or circumstances other than those to which it is held invalid or
unenforceable) shall not be affected thereby, and each provision
of this Agreement shall be valid and enforced to the fullest
extent permitted by law.
17. Counterparts, Headings and Defined Terms. This
Agreement may be executed in counterparts, each of which shall be
an original, but all of which together shall constitute one
agreement. The headings to sections of this Agreement are for
convenient reference only and shall not be used in interpreting
this Agreement. Unless expressly stated to the contrary, all
references to "days" in this Agreement mean calendar days, and
"business days" mean calendar days excluding Saturdays, Sundays,
and California state bank holidays.
18. Time of the Essence. Time is of the essence of this
Agreement.
19. Waiver. No waiver by Buyer or Seller of any of the
terms or conditions of this Agreement or any of their respective
rights under this Agreement shall be effective unless such waiver
is in writing and signed by the party charged with the waiver.
20. Third Parties. This Agreement is entered into for the
sole benefit of Buyer and Seller and their respective permitted
successors and assigns. No party other than Buyer and Seller and
such permitted successors and assigns shall have any right of
action under or rights or remedies by reason of this Agreement.
21. Additional Documents. Each party agrees to perform any
further acts and to execute and deliver such further documents
which may be reasonably necessary to carry out the terms of this
Agreement.
22. Independent Counsel. Buyer and Seller each acknowledge
that: (i) they have been represented by independent counsel in
connection with this Agreement; (ii) they have executed this
Agreement with the advice of such counsel; and (iii) this
Agreement is the result of negotiations between the parties
hereto and the advice and assistance of their respective counsel.
The fact that this Agreement was prepared by Seller's counsel as
a matter of convenience shall have no import or significance.
Any uncertainty or ambiguity in this Agreement shall not be
construed against Seller because Seller's counsel prepared this
Agreement in its final form.
23. Condition of Property. Buyer represents and warrants
that, as specified in Section 3.3.1 hereof, Buyer has, or shall
have inspected and conducted tests and studies of the Property,
and that Buyer is familiar with the general condition of the
Property. Buyer understands and acknowledges that the Property
may be subject to earthquake, fire, floods, erosion, high water
table, dangerous underground soil conditions, hazardous materials
and similar occurrences that may alter its condition or affect
its suitability for any proposed use. Seller shall have no
responsibility or liability with respect to any such occurrence.
Buyer represents and warrants that Buyer is acting, and will act
only, upon information obtained by Buyer directly from Buyer's
own inspection of the Property. Notwithstanding anything to the
contrary contained in this Agreement, the suitability or lack of
suitability of the Property for any proposed or intended use, or
availability or lack of availability of (a) permits or approvals
of governmental or regulatory authorities, or (b) easements,
licenses or other rights with respect to any such proposed or
intended use of the Property shall not affect the rights or
obligations of the Buyer hereunder.
24. No Warranties. The Property is purchased and sold "AS
IS". The Purchase Price and the terms and conditions set forth
herein are the result of arm's-length bargaining between parties
familiar with transactions of this kind, and said price, terms
and conditions reflect the fact that Buyer shall have the benefit
of, and is relying upon, no statements, representations or
warranties whatsoever, made by or enforceable against Seller
relating to the condition, operations, dimensions, descriptions,
soil condition, suitability, compliance or lack of compliance
with any state, federal, county or local law, ordinance, order,
permit or regulation, or any other attribute or matter of or
relating to the Property, including, without limitation, (i) the
structural integrity of the Improvements, (ii) the conformity of
the Improvements to any plans or specifications for the Property,
including any plans and specifications that may have been or may
be provided to Buyer, (iii) the conformity of the Property to
past, current or future applicable zoning or building code
requirements, (iv) the existence of soil instability, past soil
repairs, soil additions or conditions of soil fill, or
susceptibility to landslides, (v) the sufficiency of any
undershoring, (vi) the sufficiency of any drainage, (vii) whether
the Property is located wholly or partially in a flood plain or a
flood hazard boundary or similar area, (viii) the existence or
non-existence of toxic or hazardous wastes or materials or
friable asbestos or asbestos containing construction materials
in, on or about the Property, (ix) any other matter affecting the
stability or integrity of the land, or any buildings or
improvements situated on or as part of the Property, (x) the
fitness or suitability of the Property for Buyer's intended use,
(xi) the potential further development of the Property, (xii) the
existence of vested land use, zoning or building entitlements
affecting the Property. Buyer represents, warrants and covenants
to Seller that, except for Seller's express representations and
warranties specified in this Agreement, Buyer is relying solely
upon Buyer's own investigation of the Property. If Seller
obtains or has obtained the services, opinions or work product of
surveyors, architects, engineers, Escrow Holder, governmental
authorities or any other person or entity with respect to the
Property, Buyer and Seller agree that Seller shall do so only for
the convenience of both parties, and the reliance by Buyer upon
any such services, opinions or work product shall not create or
give rise to any liability of or against Seller. Buyer
acknowledges that Buyer has reviewed and approved the
Environmental Report.
25. Governmental Approvals. Nothing contained in this
Agreement shall be construed as authorizing Buyer to apply for a
zone change, variance, subdivision maps, lot line adjustment or
other discretionary governmental act, approval or permit with
respect to the Property prior to the Close of Escrow, and Buyer
agrees not to do so without Seller's prior written approval,
which approval may be withheld in Seller's sole and absolute
discretion. Buyer agrees not to submit any reports, studies or
other documents, including, without limitation, plans and
specifications, impact statements for water, sewage, drainage or
traffic, environmental review forms, or energy conservation
checklists to any governmental agency, or any amendment or
modification to any such instruments or documents prior to the
Close of Escrow unless first approved by Seller, which approval
Seller may withhold in Seller's sole discretion. Buyer's
obligation to purchase the Property shall not be subject to or
conditioned upon Buyer's obtaining any variances, zoning
amendments, subdivision maps, lot line adjustment or other
discretionary governmental act, approval or permit.
26. Release. Buyer shall rely solely upon Buyer's own
inspection of the Property in determining the Property's physical
condition. Buyer waives Buyer's right to recover from and hereby
releases Seller, Seller's parent company, affiliates and
subsidiaries, and their respective directors, officers,
participants, employees and agents, any and all damages, losses,
liabilities, costs or expenses whatsoever, and claims therefor,
whether direct or indirect, known or unknown, or foreseen or
unforeseen, which may arise from or be related to (i) the
physical condition of the Property and/or (ii) the Property's
compliance, or lack of compliance with any federal, state or
local laws or regulations applicable thereto, and all
regulations, rulings, and orders promulgated or adopted pursuant
thereto. Buyer expressly waives the benefits of Section 1542 of
the California Civil Code, which provides as follows:
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THE CREDITOR
DOES NOT KNOW TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE
RELEASE, WHICH IF KNOWN TO HIM MUST HAVE MATERIALLY
AFFECTED THE SETTLEMENT WITH THE DEBTOR.
In this connection and to the extent permitted by law, Buyer
hereby agrees, represents and warrants that Buyer realizes and
acknowledges that factual matters now unknown to it may have
given or may hereafter give rise to causes of action, claims,
demands, debts, controversies, damages, costs, losses and
expenses which are presently unknown, unanticipated and
unsuspected, and Buyer further agrees, represents and warrants
that the waivers and releases herein have been negotiated and
agreed upon in light of that realization and that Buyer
nevertheless hereby intends to release, discharge and acquit
Seller from any such unknown causes of action, claims, demands,
debts, controversies, damages, costs, losses and expenses which
might in any way be included as a material portion of the
consideration given to Seller by Buyer in exchange for Seller's
performance hereunder.
Seller has given Buyer material concessions regarding this
transaction in exchange for Buyer agreeing to the provisions of
this Section 26. Seller and Buyer have each initialed this
Section 26 to further indicate their awareness and acceptance of
each and every provision hereof.
SELLER'S INITIALS:/s/ MW BUYER'S INITIALS:/s/ RSZ
27. Assignment. Buyer may assign its rights and
obligations hereunder to an entity controlled by or under common
control with Buyer without obtaining Seller's prior written
consent. In no event shall any such assignment relieve Buyer
from its obligations under this Agreement. Any other purported
or attempted assignment or delegation without obtaining Seller's
prior written consent shall be void and of no effect.
28. Successors and Assigns. Subject to the restrictions on
transfer set forth in Section 28, this Agreement shall be binding
upon and inure to the benefits of the heirs, successors and
assigns of the parties hereto. In no event shall Buyer have any
right to delay or postpone the Closing to create a partnership,
corporation or other form of business association or to obtain
financing to acquire title to the Property or to coordinate with
any other sale, transfer, exchange or conveyance.
29. Exhibits. Each reference to an exhibit in this
Agreement shall mean the exhibit attached to this Agreement.
Each such exhibit is incorporated herein by this reference.
30. No Reservation of Property. The preparation and/or
delivery of unsigned drafts of this Agreement shall not create
any legally binding rights in the Property and/or obligations of
the parties, and Buyer and Seller acknowledge that this Agreement
shall be of no effect until it is duly executed by Buyer and
Seller. Buyer understands and agrees that Seller shall have the
right to continue to market the Property and/or to negotiate with
other potential purchasers of the Property until the expiration
of the Contingency Period and the satisfaction or waiver in
writing of all conditions to the obligations of Buyer under this
Agreement.
31. Duty of Confidentiality. Buyer and Seller covenant,
represent and warrant that each shall keep all information and/or
reports obtained from the other, or related to or connected with
the Property, the other party, or this transaction, confidential
and will not disclose any such information to any person or
entity without obtaining the prior written consent of the other
party, which consent shall not be unreasonably withheld,
conditioned or delayed. This covenant shall terminate upon the
Close of Escrow. The parties agree to issue a joint press
release upon the Close of Escrow.
32. Audit Rights. At Buyer's request at any time from and
after the date hereof until the date that is one (1) year after
the Closing, Seller shall, at Buyer's expense, provide to Buyer's
designated independent auditor access to the books and records of
the Property, regarding the period for which Buyer is required to
have audited financial statements prepared with respect to the
Property as may be required by the Securities and Exchange
Commission, to the extent that such books, records and related
information are in Seller's possession or control and relate to
the period during which Seller held title to the Property.
IN WITNESS WHEREOF, Buyer and Seller do hereby execute this
Agreement as of the date first written above.
BUYER:
ARDEN REALTY LIMITED PARTNERSHIP,
a Maryland limited partnership
By: /s/ Xxxxxxx X. Xxxxx
Xxxxxxx X. Xxxxx,
Chairman of the Board and
Chief Executive Officer
SELLER:
PROPERTY ASSET MANAGEMENT INC.
a Delaware corporation
By: /s/ X. Xxxxx
Its: Senior Vice President
The Company hereby agrees to furnish supplementally the ommitted
exhibits and schedules to the Commission upon request.
