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EXHIBIT 2.2
PURCHASE AGREEMENT
THIS AGREEMENT is made and entered into as of this 2nd day of July, 1997, by
and between XXXXXXX WEST INVESTMENT CORPORATION, a Delaware corporation
("Purchaser"), and MERIT 1995 INDUSTRIAL PORTFOLIO LIMITED PARTNERSHIP, a Texas
limited partnership (Seller").
IN CONSIDERATION of the respective agreements hereinafter set forth, Seller
and Purchaser hereby agree as follows:
1. Purchase and Sale.
Seller agrees to sell and convey to Purchaser, and Purchaser agrees to
purchase from Seller, on the terms and conditions set forth in this Agreement,
the Property. As used herein, the term the "Property" shall mean,
collectively: (a) the parcels of land described in Exhibit A attached hereto
(collectively, the "Land"), together with all rights, easements and interests
appurtenant thereto including, but not limited to, any streets or other public
ways adjacent to the Land and any development rights, water or mineral rights
owned by, or leased to, Seller; (b) all improvements located on the Land,
including, but not limited to, those certain ten (10) buildings identified on
Schedule 1 attached hereto and all other structures, systems, and utilities
associated with, and utilized by Seller in the ownership and operation of such
building(s) (all such improvements, together with such building(s), being
referred to herein as the "Improvements"), but excluding improvements, if any,
owned by tenants of such building(s); (c) all personal property owned by
Seller, located on or in the Land or Improvements, or used in connection with
the operation and maintenance of the Property (the "Personal Property"),
including, without limitation, all personal property listed on Exhibit B
attached hereto; (d) all building materials, supplies, hardware, carpeting and
other inventory maintained in connection with Seller's ownership and operation
of the Property (the "Inventory"); (e) all trademarks, tradenames, and
entitlements and other intangible property used or useful in connection with
the foregoing, including, without limitation, all of Seller's right, title and
interest in any and all warranties and guaranties relating to the Property, but
excluding all rights to use the name "Merit" (the "Intangible Personal
Property"); and (f) Seller's interest in all leases and other agreements to
occupy all or any portion of the Property that are in effect on the Contract
Date (defined below) or into which Seller enters prior to Closing (defined
below), but pursuant to the terms of this Agreement (as such may have been
amended, modified or supplemented, the "Leases").
2. Purchase Price; Independent Contract Consideration.
a. The purchase price of the Property shall be Fifteen Million
Fifty-Five Thousand Dollars ($15,055,000.00) (the "Purchase Price"). The
Purchase Price shall be paid to Seller at Closing, plus or minus prorations and
other adjustments hereunder, in immediately available funds.
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b. The Purchase Price shall be paid as follows:
i. Upon mutual execution of this Agreement, Purchaser
shall deliver to Commonwealth Land Title Company of Dallas ("Title Company") a
deposit in the amount of One Hundred Fifty Thousand Dollars ($150,000.00) (the
"Initial Deposit; and, together with the Extension Deposit (as defined below),
if applicable, the "Deposit"). The Deposit shall be held in an
interest-bearing account and interest accruing thereon shall be held for the
account of Purchaser. In the event the sale of the Property as contemplated
hereunder is consummated, the Deposit plus interest accrued thereon shall be
delivered to Seller at the Closing and credited against the Purchase Price.
ii. Prior to or contemporaneous with the execution
hereof by Purchaser and Seller, Purchaser has paid to Seller One Hundred
Dollars ($100.00) (the "Independent Contract Consideration"), which amount
Seller and Purchaser bargained for and agreed to as consideration for Seller's
execution and delivery of this Agreement. The Independent Contract
Consideration is non-refundable and in addition to any other payment or deposit
required by this Agreement, and Seller shall retain the Independent Contract
Consideration notwithstanding any other provision of this Agreement to the
contrary; provided, however, that if the Closing shall occur hereunder, then
the Independent Contract Consideration shall be applied to the Purchase Price.
iii. The balance of the Purchase Price shall be paid to
Seller at the closing of the purchase and sale contemplated hereunder (the
"Closing").
3. Title to the Property.
a. At the Closing, Seller shall convey to Purchaser indefeasible
and insurable fee simple title to the Land and the Improvements, by one or more
duly executed and acknowledged special warranty deeds in the form attached
hereto as Exhibit C (collectively, the "Deed"). Evidence of delivery of
indefeasible and insurable fee simple title shall be the issuance by Title
Company to Purchaser of a Texas Owner's Policy of Title Insurance (Form T-1) in
the amount of the Purchase Price (the "Title Policy"), insuring fee simple
title to the Land and the Improvements in Purchaser, subject only to such
exceptions as Purchaser shall approve pursuant to Subparagraph 5(a) below (the
"Permitted Exceptions"). The Title Policy shall contain such special
endorsements as Purchaser may reasonably require, including, without
limitation, the amendment of the survey exception to read "shortages in area"
only (the "Endorsements"). The Title Company shall also provide for
reinsurance with direct access with such companies and in such amounts as
Purchaser shall reasonably request.
b. At the Closing, Seller shall transfer title to the Personal
Property and the Inventory by a xxxx of sale in the form attached hereto as
Exhibit D (the "Xxxx of Sale"), such title to be free of any liens,
encumbrances or interests, other than the Permitted Exceptions.
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c. At the Closing, Seller shall transfer title to the Intangible
Personal Property by an assignment of service contracts, warranties and
guaranties and other intangible property in the form attached hereto as Exhibit
E (the "Assignment of Intangible Property") and shall transfer title to the
Leases by an assignment of leases in the form attached hereto as Exhibit F (the
"Assignment of Leases"), such title to be free of any liens, encumbrances or
interests, other than the Permitted Exceptions.
4. Due Diligence and Time for Satisfaction of Conditions.
Purchaser shall have the right to commence due diligence with respect to the
Property following the date on which this Agreement is fully executed by the
parties hereto (the "Contract Date") and the due diligence period ("Due
Diligence Period") shall expire on July 30, 1997, provided, however, in the
event that Seller fails to deliver to Purchaser any of the items identified on
Exhibit G attached hereto and identified with an asterisk (the "Delivery
Items") on or before the date that is five (5) days after the Contract Date,
the Due Diligence Period shall be extended with respect to such undelivered
Delivery Item only by one day for each day beyond such fifth (5th) day until
such Delivery Item is delivered to Purchaser. In addition to the foregoing,
Seller shall, upon 24 hours notice, make available to Purchaser and its
employees, representatives, counsel and consultants access to all of its books,
records and files relating to the Property in Seller's possession or reasonable
control, including, without limitation, all of the items set form on said
Exhibit G other than the Delivery Items, and Seller agrees, to the extent
reasonably feasible, to allow Purchaser to make copies at Seller's office or
the property management office of such items as Purchaser reasonably requests.
As used in this Agreement, the term "reasonable control" mean those items in
the possession of Seller's agents or independent contractors under direct
contract with Seller or its affiliates, and the term "affiliate" means any
entity or person controlled by, controlling or under common control with a
named person or entity.
5. Diligence Period Conditions.
The following conditions are precedent to Purchaser's obligation to purchase
the Property and to deliver the Purchase Price (the "Diligence Period
Conditions"):
a. Purchaser's review and approval of title to the Property, as
follows. Seller shall deliver to Purchaser at Seller's sole cost and expense,
within five (5) days after the Contract Date, the following:
i. one or more current standard coverage preliminary
title reports on the Land, issued by Title Company, accompanied by copies of
all documents referred to in the reports (the "Preliminary Reports"). In the
event the Title Company issues any supplements to the Preliminary Reports
during the term of this Agreement, Purchaser shall have five (5) business days
following delivery of any such supplemental report to approve or disapprove in
writing of any exception contained therein and not disclosed in the Preliminary
Reports, or any prior supplement thereto;
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ii. copies of all existing and proposed easements,
covenants, restrictions, agreements or other documents which affect title to
the Property and which are not disclosed by the Preliminary Reports;
iii. all surveys of the Land and Improvements in Seller's
possession or reasonable control; and
iv. copies of the most recent property tax bills for the
Property.
Purchaser shall advise Seller, at least ten (10) days prior to the end of
the Due Diligence Period, what exceptions to title, if any, will be accepted by
Purchaser. Seller shall have five (5) days after receipt of Purchaser's
objections to give Purchaser: (i) notice that Seller shall use all reasonable
efforts to remove all disapproved exceptions from title on or before the
Closing Date; or (ii) notice that Seller elects not to cause such exceptions to
be removed. If Seller gives Purchaser notice under clause (ii), Purchaser
shall have five (5) days to elect to proceed with the purchase or terminate
this Agreement. If Purchaser shall fail to give Seller notice of its election
within said five (5) days, Purchaser shall be deemed to have elected to
terminate this Agreement. If Seller gives notice under clause (i) above and
fails to remove all such disapproved exceptions prior to the Closing Date
despite using its reasonable efforts and Purchaser is unwilling to accept title
subject to such exception in its sole and absolute discretion, Purchaser shall
have the right to terminate this Agreement. Notwithstanding anything to the
contrary provided herein, Seller shall be obligated to remove or endorse over
to the reasonable satisfaction of Purchaser prior to Closing all monetary liens
encumbering the Property (or any portion thereof) other than the lien of any
property taxes, not yet due or payable.
b. Purchaser's review and approval of the matters described in
Paragraph 4 above and each component thereof as Purchaser shall desire in its
sole and absolute discretion. Such review shall include an examination for the
presence or absence of Hazardous Material (as defined in Subparagraph 8(j)
below). Notwithstanding anything to the contrary contained herein, Purchaser
shall not engage in or otherwise conduct any additional environmental studies
or environmental testing or sampling of any kind with respect to the Property
or with respect to the soils or ground water, or other studies which would
require test boring or which testing would otherwise damage or disturb any
portion of the Property, without obtaining Seller's prior written consent
thereto, which consent shall not be unreasonably withheld, delayed or
conditioned.
c. Purchaser's review and approval, within the Due Diligence
Period, of a schedule (the "Schedule of Agreements") setting forth an exclusive
list of all of the service contracts and similar agreements affecting the
Property. Prior to the end of the Due Diligence Period, Purchaser shall
deliver to Seller a list setting forth those service contracts and similar
agreements that shall be assigned to, and assumed by, Purchaser at the Closing
(the "Assumed Contracts"). Purchaser shall have the right, in its sole
discretion, to require the termination of any service contract or similar
agreement that is
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not an Assumed Contract effective as of the Closing, provided that either (i)
such contract or agreement is terminable by Seller without the payment of any
fee or penalty and Purchaser provides to Seller adequate notice that Purchaser
shall require the termination of such contract or agreement or (ii) the service
provider is an affiliate of Seller or Seller's general partner.
Prior to the end of the Due Diligence Period, Purchaser shall
deliver written notice (the "Approval Notice") to Seller informing Seller
whether or not Purchaser has approved or waived all of the Diligence Period
Conditions. Notwithstanding anything in this Agreement to the contrary,
Purchaser shall have the right to terminate this Agreement at any time prior to
the end of the Due Diligence Period in its sole and absolute discretion and for
any or for no reason whatsoever. If, by the end of the Due Diligence Period,
Purchaser shall not have delivered the Approval Notice to Seller approving or
waiving all of the Diligence Period Conditions, then this Agreement shall
automatically terminate, the Deposit shall be returned to Purchaser and the
parties shall be released from all obligations hereunder.
6. Conditions to Closing.
The following conditions are precedent to Purchaser's obligation to acquire
the Property and to deliver the Purchase Price (the "Conditions Precedent"):
a. This Agreement shall not have terminated pursuant to any other
provision hereof, including, without limitation, Paragraph 5 above.
b. Seller's obtaining and delivering to Purchaser tenant estoppel
certificates from tenants ("Tenants") occupying all of the rentable area of the
leased premises in the Property that is leased to Tenants, which certificates
shall be in the form of Exhibit I attached hereto (subject only to such changes
and qualifications, including, without limitation, statements alleging defaults
or other matters, as are acceptable to Purchaser in its reasonable discretion)
and shall reflect the terms of the respective Leases, and which certificates
shall be dated (or recertified) no earlier than forty-five (45) days prior to
the Closing Date. Seller shall deliver to each of the Tenants of the Property,
and shall use its reasonable efforts to obtain from each of the Tenants, a
tenant estoppel certificate in the form attached hereto as Exhibit I, revised
by Seller to reflect the terms of the respective Leases, and modified to
address reasonable, specific concerns arising as a result of Purchaser's review
of the Leases that are conveyed to Seller in writing prior to the expiration of
the Due Diligence Period. As used in this Section 6(b), reasonable efforts
shall be limited to demand only and Seller shall not be obligated to institute
legal action to require delivery of such estoppel certificates.
Notwithstanding the foregoing, to the extent that Seller has not obtained
satisfactory estoppel certificates from all of the Tenants despite its using
reasonable best efforts, but Seller has obtained satisfactory estoppel
certificates from all of the Major Tenants and from Tenants (including Major
Tenants) occupying ninety percent (90%) or more of the rentable area of the
leased premises in the Property that is leased to Tenants, then Seller shall
deliver to Purchaser a
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master landlord estoppel dated as of the Closing Date with respect to all
leased space in the Premises for which a satisfactory tenant estoppel
certificate is not delivered by Seller, which master estoppel certificate shall
be in form and substance (based substantially on Exhibit I hereto) reasonably
satisfactory to Purchaser, and the Condition Precedent set forth in this
Paragraph 6(b) shall be deemed satisfied. The representations and warranties
set forth in Seller's master estoppel certificate shall survive the Closing as
to each such space until the scheduled expiration date of the current term of
the lease for such space. In the event Seller shall deliver one or more
estoppel certificates, Seller shall have the right, after the Closing, to
continue to obtain estoppel certificates with respect to such leases. In the
event Seller is able to obtain an estoppel certificate from a tenant for which
Seller delivered a replacement estoppel certificate, then the obligations of
the Seller under the replacement estoppel certificate shall terminate and be of
no further force or effect as of the date of delivery of the estoppel
certificate from the tenant. As used herein, the term "Major Tenant" shall
mean a Tenant occupying 10,000 rentable square feet or more of leased space in
the Premises.
c. All of Seller's representations and warranties contained in or
made pursuant to this Agreement shall have been true and correct when made and
shall be true and correct as of the Closing Date. At the Closing Seller shall
deliver to Purchaser a certificate certifying that each of Seller's
representations and warranties contained in Paragraph 8 below are true and
correct as of the Closing Date. In the event that Seller advises Purchaser
prior to the Closing that any of Seller's representations or warranties set
forth herein is not true and correct as a result of an event occurring after
the Contract Date that is beyond the control of Seller or Seller's employees,
partners, agents or contractors, then Purchaser's sole remedy shall be to
cancel and terminate this Agreement and receive the return of the Deposit or to
waive the condition precedent set forth in this Paragraph 6(c) with respect to
such representation or warranty and, in the event the Closing occurs, Purchaser
shall not be entitled to any reduction in the Purchase Price or recover damages
from Seller with respect to such representation or warranty. Notwithstanding
anything to the contrary set forth above, in the event that Purchaser advises
Seller prior to the Closing that any of Seller's representations or warranties
set forth herein is not true and correct, Seller shall have the right to elect
to cure such untrue or incorrect representation or warranty prior to the
Closing, and in the event that Seller cures all such untrue or incorrect
representations and warranties prior to the Closing, the Condition Precedent
set forth in this Paragraph 6(c) shall be deemed satisfied. Seller shall have
the right to extend the Closing Date with respect to any affected Constituent
Parcel Constituent Parcel (as defined below) for up to sixty (60) days to cure
any such untrue or incorrect representations or warranties, provided that
Seller (i) delivers written notice to Purchaser within five (5) days after
Seller receives such notification from Purchaser, which notice shall state that
Seller is electing to extend the Closing Date and that Seller will use all
commercially reasonable efforts to cure such untrue or incorrect representation
or warranty, and (ii) thereafter diligently proceeds to attempt to cure all
such untrue or incorrect representations and warranties. The sixty (60) day
period set
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forth in the immediately preceding sentence shall run concurrent with the sixty
(60) day period set forth in Paragraph 11(b) below.
d. The physical condition of the Property shall be substantially
the same on the day of Closing as on the date of Purchaser's execution of this
Agreement, reasonable wear and tear and loss by casualty excepted (subject to
the provisions of Paragraph 12 below), and, as of the day of Closing, there
shall be no litigation or administrative agency or other governmental
proceeding of any kind whatsoever, pending or threatened, which after Closing
would materially adversely affect the value of the Property or the ability of
Purchaser to operate the Property in the manner in which it is currently being
operated, and no proceedings shall be pending or threatened which could or
would cause the redesignation or other modification of the zoning
classification of, or of any building code requirements applicable to the
Property or any portion thereof.
e. Title Company shall be irrevocably and unconditionally
committed to issue to Purchaser the Title Policy as described in Subparagraph
3(a) above.
The Conditions Precedent are intended solely for the benefit of
Purchaser. Subject to the provisions of Paragraph 7(b) below, if any of the
Conditions Precedent is not satisfied, Purchaser shall have the right in its
sole discretion either to waive in writing such Condition Precedent without
reduction in the Purchase Price and proceed with the purchase or terminate this
Agreement, in which event the Deposit shall be returned to Purchaser and the
parties shall be released from all obligations hereunder.
In the event that Purchaser consummates the Closing hereunder,
Purchaser shall be deemed to have waived any and all unsatisfied conditions
precedent.
7. Remedies.
a. In the event the sale of the Property is not consummated because of
the failure of any condition or any other reason except a default under this
Agreement or any of the Other Agreements (as defined below) on the part of
Purchaser, the Deposit plus interest accrued thereon shall immediately be
returned to Purchaser. If said sale is not consummated because of a default
under this Agreement or under any of the Other Agreements on the part of
Purchaser, the Deposit (but not the interest accrued thereon) shall be paid to
and retained by Seller as liquidated damages. The parties have agreed that
Seller's actual damages, in the event of a default by Purchaser, would be
extremely difficult or impracticable to determine. THEREFORE, BY PLACING THEIR
INITIALS BELOW, THE PARTIES ACKNOWLEDGE THAT THE DEPOSIT (AS WELL AS THE
DEPOSIT UNDER EACH OF THE OTHER AGREEMENTS) HAS BEEN AGREED UPON, AFTER
NEGOTIATION, AS THE PARTIES' REASONABLE ESTIMATE OF SELLER'S DAMAGES AND AS
SELLER'S EXCLUSIVE REMEDY AGAINST PURCHASER, AT LAW OR IN EQUITY, IN THE EVENT
OF A DEFAULT UNDER THIS AGREEMENT OR UNDER ANY OF THE OTHER AGREEMENTS ON THE
PART OF PURCHASER. NOTWITHSTANDING THE FOREGOING PROVISIONS OF THIS
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PARAGRAPH 7(A), THIS PARAGRAPH 7(A) SHALL NOT LIMIT ANY RECOVERY BY SELLER
PURSUANT TO THE PROVISIONS OF PARAGRAPHS 13, 17(B), 17(H), AND 17(L) BELOW OR
PURSUANT TO THE PROVISIONS OF PARAGRAPHS 13, 17(B), 17(H), AND 17(L) OF ANY OF
THE OTHER AGREEMENTS.
INITIALS: Seller _______ Purchaser _______
b. In the event the sale of the Property is not consummated because of
a material default under this Agreement on the part of Seller or a material
default under any of the Other Agreements on the part of the "Seller"
thereunder, which default is not cured within three (3) business days after
receipt of written notice from Purchaser, or if a Condition Precedent cannot be
fulfilled because Seller frustrated such fulfillment by some willful act,
Purchaser may elect, as its sole and exclusive remedy hereunder, to either (1)
terminate this Agreement by delivery of notice of termination to Seller,
whereupon (A) the Deposit (as well as the Deposit under each of the Other
Agreements) plus interest accrued thereon shall be immediately returned to
Purchaser, and (B) Seller shall pay to Purchaser any title, escrow, legal and
inspection fees incurred by Purchaser and any other expenses incurred by
Purchaser in connection with the negotiation of this Agreement and the Other
Agreements and Purchaser's pursuit of the transactions contemplated hereunder
and under the Other Agreements and the performance of its due diligence review
of the Property and the "Property" described in the Other Agreements,
including, without limitation, environmental and engineering consultants' fees
and expenses and legal fees, and neither party shall have any further rights or
obligations hereunder, or (2) continue this Agreement pending Purchaser's
action for specific performance.
8. Closing and Escrow.
a. Upon mutual execution of this Agreement, the parties hereto shall
deposit an executed counterpart of this Agreement with Title Company and this
Agreement shall serve as instructions to Title Company for consummation of the
purchase and sale contemplated hereby. Seller and Purchaser agree to execute
such additional escrow instructions as may be appropriate to enable the escrow
holder to comply with the terms of this Agreement; provided, however, that in
the event of any conflict between the provisions of this Agreement and any
supplementary escrow instructions, the terms of this Agreement shall control.
b. The parties shall conduct an escrow Closing pursuant to this
Paragraph 8 on or before September 4, 1997 or on such other date as Purchaser
and Seller may agree in their sole and absolute discretion (the "Closing
Date"), provided, however, that Purchaser shall have the right to extend the
Closing Date on one or more occasions for up to thirty (30) days in the
aggregate so long as Purchaser (i) delivers written notice to Seller not less
than ten (10) business days prior to the then scheduled Closing Date, (ii)
deposits an
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additional One Hundred Ten Thousand Dollars ($110,000.00) (the "Extension
Deposit") in escrow with Title Company, and (iii) similarly extends the
"Closing Date" under each of the Other Agreements and deposits with Title
Company the "Extension Deposits" thereunder, and Seller shall have the right to
extend the Closing Date with respect to affected Constituent Parcels for up to
sixty (60) days as set forth in Paragraphs 6(c) and 11(b) hereof. Upon deposit
with Title Company, the Extension Deposit shall be non-refundable, except to
the extent that this Agreement terminates as a result of a Seller default or
the failure of a condition to Closing for the benefit of Purchaser.
c. At or before the Closing, Seller shall deliver to Purchaser the
following:
i. the duly executed (and where appropriate acknowledged)
Deed, Xxxx of Sale, Assignment of Intangible Property and Assignment of Leases;
ii. duly executed estoppel certificates as required pursuant
to Subparagraph 8(b) above;
iii. originals of all Leases, Assumed Contracts, and building
permits, certificates of occupancy and plans and specifications for the
Improvements and all tenant-occupied space included within the Improvements to
the extent in Seller's possession or reasonable control;
iv. notices to the Tenants in form satisfactory to Purchaser,
duly executed by Seller;
v. a "FIRPTA Affidavit" pursuant to Section 1445 (b)(2) of
the Internal Revenue Code, duly executed by Seller;
vi. such resolutions, authorizations, bylaws or other
corporate and/or partnership documents or agreements relating to Seller as
shall be required by the Title Company;
vii. the certificate certifying as to Seller's representations
and warranties as required by Subparagraph 6(c) above;
viii. keys to all locks located in or about any portion of the
Property and all personal property described in the Bills of Sale to the extent
in Seller's possession or reasonable control; and
ix. any other customary and/or reasonable closing documents
requested by the Title Company. Purchaser may waive compliance on Seller's
part under any of the foregoing items by an instrument in writing.
d. At or before the Closing, Purchaser shall deliver to Seller the
following:
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i. the duly executed Assignment of Leases and Assignment of
Intangible Property;
ii. such resolutions, authorizations, bylaws or other
corporate and/or partnership documents or agreements relating to Purchaser as
shall be required by Title Company;
iii. any other customary and/or reasonable closing documents
requested by the Title Company;
iv. in sufficient time to permit an 8:00 a.m. (Dallas time)
Closing, the balance of the Purchase Price in cash or other immediately
available funds, subject to prorations and adjustments as set forth herein.
e. Seller and Purchaser shall each deposit such other instruments as
are reasonably required by the escrow holder or otherwise required to close the
escrow and consummate the acquisition of the Property in accordance with the
terms hereof. Seller and Purchaser hereby designate Title Company as the
"Reporting Person" for the transaction pursuant to Section 6045(e) of the
Internal Revenue Code and the regulations promulgated thereunder and agree to
execute such documentation as is reasonably necessary to effectuate such
designation.
f. The following are to be apportioned as of the Closing Date, as
follows:
i. RENT. Rent for the current month under the Leases shall
be apportioned as of the Closing Date, regardless of whether or not such rent
has been paid to Seller. With respect to any rent arrearages arising under the
Leases, after Closing Purchaser shall pay on or before the 15th day of each
calendar month to Seller any rent actually collected during the preceding month
that is applicable to the period preceding the Closing Date; provided, however,
that all rent collected by Purchaser shall be applied first to all unpaid rent
accruing after the Closing Date, and then to unpaid rent accruing prior to the
Closing Date. Purchaser shall use reasonable efforts for a period of six (6)
months after Closing to recover rent arrearages, provided that Purchaser shall
not be obligated to xxx any Tenant, evict any Tenant or institute any other
legal or quasi-legal proceeding against any Tenant. Seller shall not be
permitted to take any steps to recover any rent arrearages after Closing,
provided that Seller shall have the right to commence suit against a Tenant to
recover rent arrearages for a period of six (6) months after the Closing and
prosecute such suit to completion and Seller shall have the right to xxx a
Tenant at any time after such Tenant's Lease has expired or otherwise
terminates, provided that in no event shall Seller have the right to bring
either an unlawful detainer action or seek recourse to a Tenant's security
deposit transferred to Purchaser.
ii. LEASING COSTS; TENANT INDUCEMENTS. Seller shall pay all
leasing commissions and tenant improvement costs that arise in connection with
any Lease executed on or before the Contract Date. With respect to any new
Lease or Lease
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extension or expansion entered into by Seller between the Contract Date and the
Closing Date and approved by Purchaser pursuant to the terms of Paragraph 15(a)
below, in the event that Seller incurs or pays any costs or expenses for
leasing commissions and/or tenant allowances or improvements and/or free rent
(collectively, "New Leasing Costs") in connection with any such new Lease or
such extension or expansion in excess of the gross rental (including base rent,
additional rent and pass-throughs) (collectively, "New Leasing Revenue")
received by Seller with respect to such new Lease or such extension, Seller
shall be entitled to a credit at the Closing for the difference between the New
Leasing Costs and the New Leasing Revenue. With respect to any free rent
applicable to the period after the Closing that arises under any new Lease or
Lease extension or expansion entered into by Seller between the Contract Date
and the Closing Date and approved by Purchaser pursuant to the terms of
Paragraph 15(a) below, such free rent shall be prorated between Seller and
Purchaser based on the number of months (or fractional months) in such new
Lease or such extension or expansion that are prior to the Closing Date and the
number of such months (or fractional months) that are after the Closing Date.
iii. SECURITY DEPOSITS; PREPAID RENT. Purchaser shall be
entitled to a credit against the Purchase Price for the total sum of all
security deposits (and interest earned thereon) that are required to be
returned to the Tenants under the terms of the respective Leases.
Additionally, Purchaser shall be entitled to a credit against the Purchase
Price for the total sum of all free rent, operating expense abatements, or
other unexpired concessions under any Leases executed prior to the Contract
Date to the extent they apply to any period after the Closing.
iv. OTHER TENANT CHARGES. For all items subject to proration
for which the landlord receives reimbursement from the tenants as common area
maintenance charges ("CAM Charges"), it is acknowledged that Seller has prepaid
certain CAM Charges and already received reimbursement on account of certain
estimated CAM Charges for the period prior to Closing and Purchaser will
similarly make certain payments and receive reimbursements on account of CAM
Charges for the period after Closing. Seller shall be responsible for
collection of all estimated CAM Charges, including all delinquent amounts,
payable by the tenants prior to Closing, and Purchaser shall be responsible for
collection of all estimated CAM Charges, including delinquent amounts, payable
by the tenants after Closing. Consistent with the foregoing sentence,
Purchaser and Seller shall prorate the expense items which are subject to
reimbursement pursuant to the CAM Charges in such a way that Seller shall be
responsible for the payment of all costs and expenses which are intended to be
reimbursed by such CAM Charges for the period prior to Closing and Purchaser
shall be responsible for all such costs and expenses after Closing. At the end
of the fiscal year applicable to the CAM Charges described in the preceding
sentences of this Section, to the extent that the landlord has received excess
CAM Charges and is obligated to reimburse to the tenants any portion of the
excess CAM charges collected by Seller, Seller shall, within ten (10) days of
written demand therefor, reimburse to Purchaser the portion of such excess CAM
Charges which have been paid to and retained by Seller. In the event that at
the end of the fiscal year
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applicable to such CAM Charges, tenants on the Property are obligated to pay to
the landlord any sums on account of an underpayment of CAM Charges, Purchaser
shall pay to Seller immediately upon receipt thereof Seller's prorata share of
such reimbursement by the tenants. Purchaser shall deliver to Seller at the
same time that such notices are delivered to the tenants any accounting or
reconciliation of the CAM Charges for the fiscal year in which the Closing
occurs.
v. UTILITY CHARGES. Seller shall be responsible for the
cost of all utilities used prior to the Closing Date, except to the extent such
utility charges are billed to and paid by tenants directly.
vi. OTHER APPORTIONMENTS; CLOSING COSTS. Amounts payable
under the Assumed Contracts, annual or periodic permit and/or inspection fees
(calculated on the basis of the period covered), and liability for other
Property operation and maintenance expenses and other recurring costs shall be
apportioned as of the Closing Date. Seller shall pay all transfer taxes and
sales tax (if any) on the Personal Property. Seller shall pay the premium for
the Title Policy, provided that Purchaser shall pay the cost of the
Endorsements. Purchaser acknowledges that if title to the Property and the
"Property" described and defined in the Other Agreements is taken in the name
of the same entity or entities, and unless business reasons (e.g. financing
requirements) dictate otherwise as determined by Purchaser in its good faith
discretion, Purchaser shall obtain one title policy covering both the Property
and the "Property" described and defined in the Other Agreements. Seller and
Purchaser shall each pay fifty percent (50%) of all escrow and recording and
notary fees. Seller shall be responsible for all costs incurred in connection
with the prepayment or satisfaction of any loan secured by the Property,
including, without limitation, any prepayment fees, penalties or charges. All
other costs and charges of the escrow for the sale not otherwise provided for
in this Subparagraph 7(f)(vi) or elsewhere in this Agreement shall be allocated
in accordance with the applicable closing customs for Dallas County, Texas.
vii. REAL ESTATE TAXES AND SPECIAL ASSESSMENTS. General real
estate taxes payable for 1996 and all prior years (including subsequent taxes
and assessments for prior years due to change in land usage or ownership) shall
be paid by Seller. General real estate taxes payable for 1997 shall be
prorated by Seller and Purchaser as of the Closing Date. If the amount of
general real estate taxes for 1997 cannot be determined on the Closing Date,
Seller shall deposit with the Title Company, from the Purchase Price, an amount
equal to Seller's proportionate share of the 1997 taxes based upon the most
current estimate of such taxes, assuming for estimating purposes that the
Property shall be fully assessed. Such deposit shall be held in escrow and all
interest earnings on such deposit shall be paid to Seller. The Title Company
shall retain such deposit to pay Seller's share of the actual general real
estate taxes payable for 1997, paying any excess over to Seller. Seller shall
pay any deficiency, when such general real estate taxes are known.
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viii. PRELIMINARY CLOSING ADJUSTMENT. Seller and Purchaser
shall jointly prepare a preliminary Closing adjustment on the basis of the
Leases and other sources of income and expenses, and shall deliver such
computation to Title Company not less than 10 days prior to Closing.
ix. POST-CLOSING RECONCILIATION. If any of the aforesaid
prorations cannot be calculated accurately on the Closing Date, then they shall
be calculated as soon after the Closing Date as feasible. Either party owing
the other party a sum of money based on such subsequent proration(s) shall
promptly pay said sum to the other party, together with interest thereon at the
rate of the lesser of (A) two percent (2%) over the average "prime rate" (as
announced from time to time in the Wall Street Journal) per annum or (B) the
highest legally permitted rate, from the Closing Date to the date of payment if
payment is not made within ten (10) days after delivery of a xxxx therefor.
SURVIVAL. The provisions of this Subparagraph 8(f) shall survive
the Closing.
9. Representations and Warranties of Seller.
Seller hereby represents and warrants to Purchaser as follows:
a. Except to the extent set forth on Schedule 2 attached hereto (the
"Disclosure Schedule"), Seller has not received any written notice that the
Property or any portion thereof, including, without limitation, the use and
operation thereof, is in violation of any applicable building codes,
environmental, zoning and land use laws, or any other applicable local, state
and federal laws and regulations including, without limitation, the Americans
with Disabilities Act of 1990 and the regulations and interpretations
promulgated thereunder.
b. The operating statements and income and expense reports delivered by
Seller or its agents to Purchaser are and at the time of Closing will be true,
correct and complete copies of such documents. To the best of Seller's
knowledge, the surveys, mechanical and structural plans and specifications,
soil reports, certificates of occupancy, warranties, and all books and records
relating to the Property and all contracts or documents delivered by Seller or
its agents to Purchaser which are not otherwise described in the immediately
preceding sentence are and at the time of Closing will be true, correct and
complete copies of such documents.
c. The rent roll attached hereto as Exhibit H (the "Rent Roll") is
true, correct and complete. The copies of the Leases delivered by Seller or
its agents to Purchaser are true, correct and complete copies and contain all
of the information pertaining to any rights of any of the Tenants and, to the
best of Seller's knowledge, any other parties to occupy the Property,
including, without limitation, all information regarding any rent concessions,
over-standard tenant improvement allowances or other inducements to lease. To
the best of Seller's knowledge, except to the extent set forth on the
Disclosure Schedule, all of the Leases and Assumed Contracts are in full force
and effect, without material default by either party thereunder.
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d. Except to the extent set forth on the Disclosure Schedule, there is
no litigation or proceedings (including, without limitation, condemnation
proceedings) pending or, to the best of Seller's knowledge, threatened against
Seller that arises out of the ownership of the Property or that might
detrimentally affect the value or the use or operation of the Property for its
intended purpose or the ability of Seller to perform its obligations under this
Agreement.
e. Seller is duly formed and validly existing in good standing under
the laws of the state of Texas. This Agreement and all documents executed by
Seller which are to be delivered to Purchaser at the Closing are and at the
time of Closing will be duly authorized, executed and delivered by Seller, are
and at the time of Closing will be legal, valid and binding obligations of
Seller enforceable against Seller in accordance with their respective terms and
do not and at the time of Closing will not violate any provision of any
agreement or judicial order to which Seller or the Property is subject.
f. Except to the extent set forth on the Disclosure Schedule, at the
time of Closing there will be no outstanding written or oral contracts made by
Seller for any improvements to the Property which have not been fully paid for,
and Seller shall cause to be discharged all mechanics' and materialmen's liens
arising from any labor or materials furnished to the Property prior to the time
of Closing.
g. Seller is not a "foreign person" within the meaning of Section
1445(f)(3) of the IRC.
h. Except to the extent set forth on the Disclosure Schedule, Seller
has not received written notice indicating that the Property is in violation of
any federal, state, local or administrative agency ordinance, law, rule,
regulation, order or requirement relating to environmental conditions or
Hazardous Material. For the purposes hereof, "Hazardous Material" shall mean
any substance, chemical, waste or other material which is listed, defined or
otherwise identified as "hazardous" or "toxic" under any federal, state, local
or administrative agency ordinance or law, including, without limitation, the
Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C.
Sections 9601 et seq. ("CERCLA"); and the Resource Conservation and Recovery
Act, 42 U.S.C. Sections 6901 et seq.; or any regulation, order, rule or
requirement adopted thereunder, as well as any formaldehyde, urea,
polychlorinated biphenyls, petroleum, petroleum product or by-product, crude
oil, natural gas, natural gas liquids, liquefied natural gas, or synthetic gas
usable for fuel or mixture thereof, radon, asbestos, and "source," "special
nuclear" and "by-product" material as defined in the Atomic Energy Act of
1985, 42 U.S.C. Sections 3011 et seq.
i. Except to the extent set forth on the Disclosure Schedule, all
alterations, improvements or other work required to have been completed by
Seller under the Leases, including, without limitation, all alterations,
improvements and other work required to prepare space for the initial occupancy
of each Tenant under a Lease, has heretofore been
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completed and paid for in full, and Seller has paid in full all of landlord's
leasing costs and obligations.
j. Seller has not granted any option or right of first refusal or first
opportunity to any party to acquire any fee or ground leasehold interest in any
of the Property.
k. Neither Seller nor, to the best of Seller's knowledge, any of the
Tenants has either filed or been the subject of any filing of a petition under
the Federal Bankruptcy Law or any federal or state insolvency laws or laws for
composition of indebtedness or for the reorganization of debtors that remains
pending, except to the extent set forth on the Disclosure Schedule.
l. No brokerage or similar fee is due or unpaid by Seller with respect
to any Lease. Except to the extent set forth on the Disclosure Schedule, no
brokerage or similar fee shall be due or payable on account of the exercise of,
without limitation, any renewal, extension or expansion options arising under
any Lease.
Except as set forth in this Agreement or in any document executed pursuant to
or in connection with this Agreement, the parties hereto acknowledge and agree
that the sale of the Property to Purchaser is made on an "AS-IS, WHERE-IS" and
"WITH ALL FAULTS" basis, and Seller makes no warranty or representation,
express or implied, as to merchantability, suitability or fitness for a
particular purpose, the state of repair of the Property or the physical
condition thereof. The parties further agree, however, that this paragraph
does not affect an assumption of any liability by Purchaser and that this
paragraph shall not be construed as to waive any rights of contribution or
indemnity or otherwise affect the liabilities of the parties to each other or
to third parties under any environmental law, including CERCLA. The provisions
of this paragraph shall survive the Closing and the delivery and recordation of
the Deed.
The representations and warranties set forth in this Paragraph 9 shall survive
the Closing for the period set forth in Paragraph 17(e) below.
10. Representations and Warranties of Purchaser.
Purchaser hereby represents and warrants to Seller as follows:
a. Purchaser is duly formed and validly existing in good standing under
the laws of the State of Delaware; this Agreement and all documents executed by
Purchaser which are to be delivered to Seller at the Closing are or at the time
of Closing will be duly authorized, executed and delivered by Purchaser, are or
at the Closing will be legal, valid and binding obligations of Purchaser,
enforceable against Purchaser in accordance with their respective terms, and do
not and at the time of Closing will not violate any provisions of any agreement
or judicial order to which Purchaser is subject.
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b. Purchaser has neither filed nor been subject to the filing of a
petition under the Federal Bankruptcy Law or any federal or state insolvency
laws or laws for the composition of indebtedness or for the reorganization of
debtors that remains pending.
c. Purchaser is experienced in evaluating and investing in properties
similar in type and character to the Property.
The representations and warranties set forth in this Paragraph 10 shall survive
the Closing for the period set forth in Paragraph 17(e) below.
11. Other Agreements.
a. Notwithstanding anything to the contrary in this Agreement, but
subject to the provisions of Paragraph 11(b) below, it shall be a condition
precedent to both Purchaser's obligation to purchase the Property hereunder and
to Seller's obligation to sell the Property hereunder that the "Closing" under
and as defined in each of those three other Purchase Agreements dated as of
even date herewith and identified on Schedule 3 attached hereto (the "Other
Agreements") occurs concurrently with the Closing hereunder. The parties
acknowledge and agree that a default by Seller under this Agreement shall be
deemed a default of each of the "Sellers" under each of the Other Agreements
and that a default by a "Seller" under any of the Other Agreements shall be
deemed a default by Seller hereunder. The parties further acknowledge and
agree that a default by Purchaser under this Agreement shall be deemed a
default of each of the "Purchasers" under each of the Other Agreements and that
a default by a "Purchaser" under any of the Other Agreements shall be deemed a
default by Purchaser hereunder.
b. Notwithstanding anything to the contrary provided in Paragraph
11(a) above or elsewhere in this Agreement or any Other Agreement, in the event
that (i) Purchaser discovers during the Due Diligence Period that a Constituent
Parcel (as defined below) is in material violation of any Environmental Law
(but only if Seller fails to cure such violation prior to the Closing Date, as
such may be extended pursuant to this Paragraph 11(b), and Seller is unwilling
to give Purchaser a credit at Closing in such amount as the parties agree upon
will compensate Purchaser for such matter, it being acknowledged by the parties
hereto that Seller shall not be obligated hereunder to elect to cure any such
violation or offer to give Purchaser such a credit), (ii) Purchaser discovers
during the Due Diligence Period that there is a material defect in title that
adversely affects the marketability or financability of the Constituent Parcel
(but only if Seller fails to remedy such defect prior to the Closing Date, as
such may be extended pursuant to this Paragraph 11(b), and Seller is unwilling
to give Purchaser a credit at Closing in such amount as the parties agree upon
will compensate Purchaser for such matter, it being acknowledged by the parties
hereto that Seller shall not be obligated hereunder to elect to remedy any such
defect or offer to give Purchaser such a credit), (iii) Purchaser determines
during the Due Diligence Period that the net operating income derived from the
Property and the "Property" described and defined in the Other Agreements
differs in
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any material respect in the aggregate from that set forth in any materials
delivered to Purchaser by Seller or its agents prior to Purchaser's execution
of this Agreement or on the Rent Roll (as defined below) and one-third (() or
more of such discrepancy is attributable to any Constituent Parcel (but only to
the extent Seller is unwilling to give Purchaser a credit at Closing in an
amount equal to such loss of income, capitalized at the same rate as that
reflected by the Purchase Price, it being acknowledged by the parties hereto
that Seller shall not be obligated hereunder to offer to give Purchaser such a
credit), (iv) any of Seller's representations and warranties is not true and
correct in all material respects at Closing with respect to a Constituent
Parcel, (v) Purchaser discovers during the Due Diligence Period that there is a
material defect in the physical condition of a Constituent Parcel as disclosed
in an independent third party structural or physical report obtained by
Purchaser (but only if Seller fails to repair all such physical conditions
prior to the Closing Date, as such may be extended pursuant to this Paragraph
11(b), and Seller is unwilling to give Purchaser a credit at Closing in such
amount as the parties agree upon will compensate Purchaser for such matter, it
being acknowledged by the parties hereto that Seller shall not be obligated
hereunder to elect to repair such conditions or offer to give Purchaser such a
credit), or (vi) Purchaser elects to terminate this Agreement as to a
Constituent Parcel pursuant to Paragraph 12 below, Purchaser shall have the
right to terminate this Agreement as to such affected Constituent Parcels only
(each such Constituent Parcel being referred to herein as a "Removed Parcel"),
in which event this Agreement shall be amended to delete all references to the
Removed Parcel(s), the Purchase Price shall be reduced by the amount allocated
to the Removed Parcel(s) as set forth on Schedule 4 attached hereto, and this
Agreement and the Other Agreements shall otherwise remain in full force and
effect; provided, however, that with respect to the circumstances described in
clauses (i), (ii), (iii) and (v) above, Purchaser's right of termination shall
be conditioned upon Purchaser's informing Seller in writing prior to the end of
the Due Diligence Period that Purchaser will terminate this Agreement as to
such affected Constituent Parcel if such matter is not cured or remedied or
Purchaser is not otherwise compensated, as applicable, prior to the Closing.
Seller shall have the right to extend the Closing Date with respect to any
affected Parcel for up to sixty (60) days to remedy or cure any such
objectionable matter, provided that Seller (i) delivers written notice to
Purchaser within five (5) days after the end of the Due Diligence Period, which
notice shall state that Seller is electing to extend the Closing Date and that
Seller will use all commercially reasonable efforts to cure or remedy such
matter, and (ii) thereafter diligently proceeds to attempt to cure or remedy
such matter. The sixty (60) day period set forth in the immediately preceding
sentence shall run concurrent with the sixty (60) day period set forth in
Paragraph 6(c) above.
c. Notwithstanding anything to the contrary provided in Paragraph 11(a)
above or elsewhere in this Agreement or any Other Agreement, in the event that
the Removed Parcel(s) constitute(s) the entire Property, Purchaser shall have
the right to terminate this Agreement in its entirety, but elect to keep the
Other Agreements in full force and effect.
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d. As used herein, the term "Constituent Parcel" shall mean one of the
projects identified on Schedule 4 attached hereto, together with the Land and
all other portions of the Property properly allocable thereto.
12. Risk of Loss.
a. Purchaser shall be bound to purchase the Property for the full
Purchase Price as required by the terms hereof, without regard to the
occurrence or effect of any damage to the Property or destruction of any
improvements thereon or condemnation of any portion of the Property, provided
that (i) the cost to repair any such damage or destruction to a Constituent
Parcel, or the diminution in the value of the remaining Property as a result of
a partial condemnation, does not exceed $250,000 (and the cost to repair all
such damage or destruction to, or the diminution in value of, the Property and
the "Property" described and defined in the Other Agreements, in the aggregate,
does not exceed $1,000,000), and (ii) upon the Closing, there shall be a credit
against the Purchase Price due hereunder equal to the amount of any insurance
proceeds or condemnation awards collected by Seller as a result of any such
damage or destruction or condemnation, less any sums reasonably expended by
Seller toward the restoration or repair of the affected Property, and, if the
proceeds or awards have not been collected as of the Closing, then such
proceeds or awards shall be assigned to Purchaser.
b. If the amount of the damage or destruction or condemnation as
specified in Paragraph 12(a) above exceeds $250,000 with respect to any
Constituent Parcel, then Purchaser may, at its option to be exercised within
twenty (20) days of Seller's written notice of the occurrence of the damage or
destruction or the commencement of condemnation proceedings, either terminate
this Agreement in its entirety or solely with respect to such Constituent
Parcel or consummate the purchase for the full Purchase Price as required by
the terms hereof. Similarly, if the amount of the damage or destruction or
condemnation as specified in Paragraph 12(a) above exceeds $1,000,000 with
respect to the Property and the "Property" described and defined in the Other
Agreements, in the aggregate, then Purchaser may, at its option to be exercised
within twenty (20) days of Seller's written notice of the occurrence of the
damage or destruction or the commencement of condemnation proceedings, either
terminate this Agreement in its entirety or consummate the purchase for the
full Purchase Price as required by the terms hereof. If Purchaser elects to
terminate this Agreement in its entirety or fails to give Seller written notice
within such 20-day period that Purchaser will proceed with the purchase, then
the Deposit shall be immediately returned to Purchaser and neither party shall
have any further rights or obligations hereunder, except to the extent
expressly otherwise set forth herein. If Purchaser elects to terminate this
Agreement solely with respect to such affected Constituent Parcel, the
provisions of Paragraph 11(b) above shall control. If Purchaser elects to
proceed with the purchase as to the entire Property, then upon the Closing,
there shall be a credit against the Purchase Price due hereunder equal to the
amount of any insurance proceeds or condemnation awards collected by Seller as
a result of any such damage or destruction or condemnation, less any sums
reasonably
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expended by Seller toward the restoration or repair of the affected Property,
and, if the proceeds or awards have not been collected as of the Closing, then
such proceeds or awards shall be assigned to Purchaser.
c. In the event that Purchaser is required to or elects to purchase the
entire Property following any damage or destruction or condemnation of the
Property pursuant to Paragraph 12(a) or (b) above, Seller shall also provide
Purchaser with a credit against the Purchase Price in an amount equal to any
deductible or uninsured amount; provided, however, in no event shall Seller be
required to provide Purchaser with a credit pursuant to this Paragraph 12(c) in
an amount that exceeds $250,000 with respect to any Constituent Parcel or that
exceeds $1,000,000 with respect to the Property and the "Property" described
and defined in the Other Agreements, in the aggregate. If it is determined
that the deductible or uninsured amount is greater than $250,000 (or
$1,000,000, as applicable), Seller shall notify Purchaser in writing as soon as
reasonably possible following such determination whether or nor Seller is
willing to provide Purchaser with a credit against the Purchase Price in the
full amount of such deductible or uninsured amount. In the event that Seller
is unwilling to provide Purchaser with a credit in such full amount, Purchaser
shall have the right to terminate this Agreement by delivering written notice
to Seller within twenty (20) days after Purchaser's receipt of such notice from
Seller. If Purchaser elects to terminate this Agreement or fails to give
Seller written notice within such twenty (20) day period that Purchaser will
proceed with the purchase, the Deposit shall be immediately returned to
Purchaser and neither party shall have any further obligations hereunder,
except to the extent expressly otherwise set forth herein.
13. Possession.
Possession of the Property shall be delivered to Purchaser on the Closing
Date subject only to the rights of Tenants under the Leases, provided, however,
that prior to the Closing Date Seller shall afford authorized representatives
of Purchaser (as well as any actual or prospective lender to Purchaser)
reasonable access to the Property, upon 24 hours notice, for purposes of
satisfying Purchaser (and such lender) with respect to the representations,
warranties and covenants of Seller contained herein and with respect to
satisfaction of any Diligence Period Condition or any Condition Precedent
(including, without limitation, the Condition Precedent set forth in Paragraph
6(d) above) and for the purpose of conducting Tenant interviews, provided that
prior to entering the Property Purchaser shall (i) obtain comprehensive general
liability insurance in an amount not less than $1,000,000 naming Seller as an
additional insured and (ii) provide a copy of such policy or a certificate
evidencing such coverage to Seller. Purchaser hereby agrees to indemnify and
hold Seller harmless from any damage or injury to persons or property caused by
Purchaser or its authorized representatives during their entry and
investigations prior to the Closing, provided the foregoing shall not require
Purchaser to indemnify Seller or any other person with respect to any
conditions that are discovered by Purchaser as opposed to being first caused by
Purchaser. If this Agreement is terminated, Purchaser shall repair the damage
caused by Purchaser's entry and investigations, provided the
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foregoing shall not require Purchaser to repair or remediate any conditions
that are discovered by Purchaser as opposed to being first caused by Purchaser.
The foregoing indemnity shall survive the termination of this Agreement or the
Closing, as applicable.
14. Maintenance of the Property; Miscellaneous Covenants.
Between the Contract Date and the Closing, Seller shall perform all of the
landlord's obligations under the Leases and shall otherwise operate and
maintain the Property in the same manner as before the making of this
Agreement, as if Seller were retaining the Property. Seller shall promptly
notify Purchaser of any condemnation, environmental, zoning or other land-use
regulation proceedings of which Seller becomes aware, as well as any notices of
violations of any Laws relating to the Property of which Seller becomes aware
and any litigation of which Seller becomes aware that arises out of the
ownership of the Property or that might detrimentally affect the value or the
use or operation of the Property or the ability of Seller to perform its
obligations hereunder. Following the Contract Date, Seller shall continue to
prepare Operating Statements (as defined in Exhibit G hereto) for the Property
as to all time periods subsequent to the dates of the Operating Statements
delivered to Purchaser as part of the Delivery Items and prior to the Closing
Date, which Operating Statements shall be delivered to Purchaser within a
reasonable period of time following the end of the period with respect to which
such Operating Statements are prepared, even if prepared after Closing.
Through the Closing Date, Seller shall maintain or cause to be maintained, at
Seller's sole cost and expense, all policies of insurance currently in effect
with respect to the Property (or comparable replacements thereof).
15. Purchaser's Consent to New Contracts Affecting the Property; Termination of
Existing Contracts.
a. Seller shall not, after the Contract Date, enter into any Lease or
contract, or any amendment thereof, or permit any Tenant to enter into any
sublease, assignment or agreement pertaining to the Property, or waive any
rights of Seller under any contract or Lease, without in each case obtaining
Purchaser's prior written consent thereto, which consent in the case of any
Lease shall include approval of the financial condition of the proposed tenant,
the configuration of the space to be leased, and the terms of such Lease
(including, without limitation, the rent and any concessions provided under
such proposed Lease), and which consent shall not be unreasonably withheld by
Purchaser. Seller shall be entitled, without the consent of Purchaser, to
enter into, amend or otherwise deal with service contracts and similar
agreements that are not Assumed Contracts in the ordinary course of business
that are terminable on not more than thirty (30) days' prior notice and which
shall not be binding on Purchaser after the Closing Date. Seller shall deliver
to Purchaser, together with any request for approval of a new Lease, a copy of
the proposed Lease, a description of the proposed Tenant and its proposed use
of the premises and whatever financial information on the proposed Tenant
Seller has received, as well as any additional information reasonably requested
by
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Purchaser (including, without limitation, if applicable, an environmental
questionnaire). Notwithstanding anything to the contrary provided in this
Subparagraph 15(a), if Purchaser fails to respond in writing with respect to
any such new Lease or other action requiring Purchaser's consent under this
Subparagraph 15(a) within five (5) business days after Purchaser's receipt of
such request and information, Purchaser shall be deemed to have approved such
new Lease or other action.
b. Seller shall terminate prior to the Closing, at no cost or expense
to Purchaser, any and all management agreements, service contracts or similar
agreements affecting the Property that are not Assumed Contracts.
c. Seller shall not, after the Contract Date, create any new
encumbrance or lien affecting the Property other than liens and encumbrances
(i) that are reasonably capable of being discharged prior to the Closing and
(ii) that in fact will be and are discharged prior to the Closing.
16. Cooperation with Purchaser.
Seller shall cooperate and do all acts as may be reasonably required or
requested by Purchaser with regard to the fulfillment of any Condition
Precedent including execution of any documents, applications or permits
reasonably requested by Purchaser and, to the extent requested by Purchaser,
agrees to cooperate with Purchaser's efforts to obtain subordination,
non-disturbance and attornment agreements from the Tenants. Seller hereby
authorizes Purchaser and its agents to make all inquiries with and applications
to any third party, including any governmental authority, as Purchaser may
reasonably require to complete its due diligence.
17. Miscellaneous.
a. NOTICES. Any notice, consent or approval required or permitted to
be given under this Agreement shall be in writing and shall be deemed to have
been given upon (i) hand delivery, (ii) one (1) business day after being
deposited with Federal Express or another reliable overnight courier service,
with receipt acknowledgment requested, (iii) upon receipt if transmitted by
facsimile telecopy, or (iv) upon receipt or refused delivery deposited in the
United States mail, registered or certified mail, postage prepaid, return
receipt required, and addressed as follows:
IF TO SELLER: Merit 1995 Industrial Portfolio
Limited Partnership
c/o MTP, Inc.
00000 Xxxxxxx Xxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000
Attn: Xxxxxx XxXxxxxx
Fax No.: (000) 000-0000
WITH A COPY TO: Xxx X. Xxxxxxxx, PC
00000 Xxxxxxx Xxxx, Xxxxx 000
00
00
Xxxxxx, Xxxxx 00000
Fax No.: (000) 000-0000
IF TO PURCHASER: Xxxxxxx West Investment Corporation
0000 Xxxxxx xxx Xxx Xxxxx, Xxxxx 000
Xxx Xxxxx, Xxxxxxxxxx 00000
Attn: Xxxx X. Xxxxxxx
Fax No.: (000) 000-0000
WITH A COPY TO: Xxxxxx, Xxxxxxxxxx & Xxxxxxxxx LLP
Old Federal Reserve Bank Building
000 Xxxxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxx X. Xxxxx, Esq.
Fax No.: (000) 000-0000
or such other address as either party may from time to time specify in writing
to the other.
b. BROKERS AND FINDERS. Neither party has had any contact or dealings
regarding the Property, or any communication in connection with the subject
matter of this transaction, through any real estate broker or other person who
can claim a right to a commission or finder's fee in connection with the sale
contemplated herein, except for Xxxxxxx & Xxxxxxxxx of Texas, Inc. ("Broker"),
whose commission shall be paid by Seller pursuant to the terms of a separate
agreement between Seller and Broker. In the event that any other broker or
finder makes a claim for a commission or finder's fee based upon any contact,
dealings or communication, the party whose conduct is the basis for the broker
or finder making its claim shall indemnify, defend and hold harmless the other
party against and from any commission, fee, liability, damage, cost and
expense, including without limitation attorneys' fees, arising out of or
resulting from any such claim. The provisions of this paragraph shall survive
the Closing.
c. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon, and
inure to the benefit of, the parties hereto and their respective successors,
heirs, administrators and assigns. Notwithstanding the foregoing, Purchaser
shall not have the right, without the prior written approval of Seller, to
assign this Agreement in whole or in part, provided that Purchaser may assign
this Agreement upon notice to Seller (but without any requirement of obtaining
Seller's consent) in whole or in part to (i) one or more entities in which Xxxx
X. Xxxxxxx, Xxx X. Xxxxxxx and/or Xxxxx X. Xxxxxxxx, directly or indirectly,
has an ownership interest, and/or (ii) an entity controlled or managed by, or
otherwise affiliated with, Xxxxxx Xxxxxx & Co., provided that such assignee(s)
shall assume all of the obligations of Purchaser hereunder and the foregoing
shall not act as a release of the party originally designated as Purchaser
hereunder. To the extent that any indemnity set forth in this Agreement is
made for the benefit of Purchaser or Seller, the term "Purchaser" or "Seller",
as applicable, as it pertains to an indemnified party only, shall
22
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include the managers, members, investors, affiliates, lenders, officers,
directors, shareholders, partners, trustees, beneficiaries, agents and
employees of such party and their respective heirs, representatives, successors
and assigns.
d. AMENDMENTS. Except as otherwise provided herein, this Agreement may
be amended or modified only by a written instrument executed by Seller and
Purchaser.
e. CONTINUATION AND SURVIVAL OF REPRESENTATIONS AND WARRANTIES, ETC.
All representations and warranties by the respective parties contained herein
or made in writing pursuant to this Agreement are intended to and shall remain
true and correct as of the time of Closing, shall be deemed to be material,
and, together with all conditions, covenants and indemnities made by the
respective parties contained herein or made in writing pursuant to this
Agreement, shall survive the execution and delivery of this Agreement and the
Closing for a period of 12 months, or, to the extent the context requires,
beyond any termination of this Agreement. In the event that a claim is not
made with respect to a breach of a representation, warranty or covenant set
forth herein within such 12 month period, such claim shall be deemed waived.
f. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
g. MERGER OF PRIOR AGREEMENTS. This Agreement and the exhibits and
schedules hereto constitute the entire agreement between the parties and
supersede all prior agreements and understandings between the parties relating
to the subject matter hereof.
h. ENFORCEMENT. If either party hereto fails to perform any of its
obligations under this Agreement or if a dispute arises between the parties
hereto concerning the meaning or interpretation of any provision of this
Agreement, then the defaulting party or the party not prevailing in such
dispute shall pay any and all costs and expenses incurred by the other party on
account of such default and/or in enforcing or establishing its rights
hereunder, including, without limitation, court costs and attorneys' fees and
disbursements. Any such attorneys' fees and other expenses incurred by either
party in enforcing a judgment in its favor under this Agreement shall be
recoverable separately from and in addition to any other amount included in
such judgment, and such attorneys' fees obligation is intended to be severable
from the other provisions of this Agreement and to survive and not be merged
into any such judgment.
i. TIME OF THE ESSENCE. Time is of the essence of this Agreement.
j. SEVERABILITY. If any provision of this Agreement, or the
application thereof to any person, place, or circumstance, shall be held by a
court of competent jurisdiction to be invalid, unenforceable or void, the
remainder of this Agreement and such provisions as applied to other persons,
places and circumstances shall remain in full force and effect.
k. MARKETING. During the term of this Agreement, Seller shall not list
the Property with any broker or otherwise solicit or make or accept any offers
to sell the
23
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Property, engage in any discussions or negotiations with any third party with
respect to the sale or other disposition of the Property, or enter into any
contracts or agreements (whether binding or not) regarding any disposition of
the Property.
l. CONFIDENTIALITY. Each party agrees to maintain in confidence, and
not to disclose to any third party, the information contained in this Agreement
or pertaining to the sale contemplated hereby and the information and data
furnished or made available by Seller to Purchaser, its agents and
representatives in connection with Purchaser's investigation of the Property
and the transactions contemplated by the Agreement; provided, however, that
each party, its agents and representatives may disclose such information and
data (a) to such party's accountants, attorneys, prospective lenders,
accountants, partners, consultants and other advisors in connection with the
transactions contemplated by this Agreement (collectively "Representatives") to
the extent that such Representatives reasonably need to know (in Purchaser's or
Seller's reasonable discretion) such information and data in order to assist,
and perform services on behalf of, Purchaser or Seller; (b) to the extent
required by any applicable statute, law, regulation, governmental authority or
court order; and (c) in connection with any litigation that may arise between
the parties in connection with the transactions contemplated by this Agreement.
In the event of any conflict between the terms of this Section 17(l) and the
terms of the Confidentiality Agreement referenced in Section 17(g) above, the
terms of said Confidentiality Agreement shall control. Each party shall
consult with the other party prior to making any press release or other
disclosure intended for general circulation regarding the transactions
contemplated hereunder. In no event shall any such disclosure or press release
contain the purchase price.
m. SECTION 1031 EXCHANGE. It is presently contemplated that Purchaser
and Seller may each desire to effectuate a tax-deferred exchange (also known as
a "1031" exchange) (an "Exchange") in connection with the purchase and sale of
the Property. Purchaser and Seller hereby agree to cooperate with each other
in connection with one or more such Exchanges, provided that:
i. All documents executed by a party in connection with the
Exchange shall be subject to the prior reasonable approval of that party and
shall recognize that that party is acting solely as an accommodating party to
such Exchange, shall have no liability with respect thereto, and is making no
representation or warranty that the transactions qualify as a tax-free exchange
under Section 1031 of the Internal Revenue Code or any applicable state or
local laws and shall have no liability whatsoever if any such transactions
fails to so qualify.
ii. Such Exchange shall not result in Purchaser or Seller
incurring any additional costs or liabilities.
24
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iii. In no event shall Purchaser or Seller be obligated to
acquire any property or otherwise be obligated to take title, or appear in the
records of title, to any property in connection with such Exchange.
iv. In no event shall Purchaser's or Seller's consummation of
such Exchange constitute a condition precedent to that party's obligations
under this Agreement, and Purchaser's or Seller's failure or inability to
consummate such Exchange for any reason or for no reason at all shall not be
deemed to excuse or release that party from its obligations under this
Agreement.
n. POST-CLOSING COOPERATION. If it becomes reasonably necessary to do
so in order to comply with applicable securities laws or the rules or
regulations of the Securities and Exchange Commission, for a period of four (4)
years after the Closing Date, Purchaser and its agents shall have the right, at
Purchaser's sole cost and expense, to inspect and obtain copies of Seller's
books and records supporting the operation of the Property for the period of
three (3) full calendar years preceding the calendar year which includes the
Closing Date. Purchaser shall give reasonable prior written notice to Seller
when Purchaser wishes to exercise its right to inspect such books and records.
Such inspection shall take place at the office of Seller during normal business
hours on a date and at a time reasonably convenient to Seller and Purchaser.
The provisions of this Paragraph 17(n) shall survive the Closing.
o. RETURN OF DOCUMENTS. In the event that this Agreement terminates,
Purchaser shall return to Seller all due diligence materials and all copies
thereof delivered by Seller to Purchaser hereunder and, subject to any
restrictions on transferability set forth therein, shall deliver to Seller
copies of all reports generated by Purchaser's contractors, engineers and other
third party professional (non-legal) consultants, all of which reports shall be
delivered by Purchaser without any representation or warranty as to the
contents thereof.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
XXXXXXX WEST INVESTMENT CORPORATION, a
Delaware corporation
By: /s/
-------------------------------------
Its: Vice President
------------------------------------
PLEASE INITIAL PARAGRAPH 7(A) ABOVE
25
26
MERIT 1995 INDUSTRIAL PORTFOLIO LIMITED
PARTNERSHIP,
a Texas limited partnership
By: MTP, Inc., a Texas corporation,
its General Partner
By: /s/
--------------------------------
Its: Chief Financial Officer and
Treasurer
PLEASE INITIAL PARAGRAPH 7(A) ABOVE
26
27
EXHIBIT LIST
Exhibit A Legal Description of Land
Exhibit B List of Personal Property
Exhibit C Form of Special Warranty Deed
Exhibit D Form of Xxxx of Sale
Exhibit E Form of Assignment of Intangible Property
Exhibit F Form of Assignment of Leases
Exhibit G Seller's Deliveries
Exhibit H Rent Roll
Exhibit I Form of Tenant Estoppel Certificate
Schedule 1 Buildings
Schedule 2 Disclosure Schedule
Schedule 3 Other Agreements
Schedule 4 Removed Parcel Allocable Amounts
(THE SCHEDULES AND EXHIBITS HAVE BEEN OMITTED, BUT SHALL BE PROVIDED TO THE
COMMISSION UPON REQUEST.)
28
FIRST AMENDMENT TO PURCHASE AGREEMENT
THIS FIRST AMENDMENT TO PURCHASE AGREEMENT (this "First Amendment"),
is made as of July 30, 1997, by and between XXXXXXX WEST INVESTMENT
CORPORATION, a Delaware corporation ("Purchaser"), and MERIT 1995 INDUSTRIAL
PORTFOLIO LIMITED PARTNERSHIP, a Texas limited partnership ("Seller"), with
reference to the following facts:
A. Seller and Buyer entered into that certain Purchase Agreement,
dated as of July 2, 1997 (the "Purchase Agreement"). Each capitalized term
used in this First Amendment, but not defined herein, shall have the meaning
ascribed to it in the Purchase Agreement.
B. Seller and Buyer desire to amend the Purchase Agreement as set
forth in this First Amendment.
NOW, THEREFORE, the parties agree as follow:
1. Due Diligence Period. Notwithstanding anything to the
contrary provided in the Purchase Agreement, the Due Diligence Period shall
expire on July 31, 1997.
2. No other Amendment; Conflict. Except as set forth in this
First Amendment, the provisions of the Purchase Agreement shall remain in full
force. If any provision of this First Amendment conflicts with any provision
of the Purchase Agreement, then the provisions of this First Amendment shall
prevail.
3. Counterparts. This First Amendment may be signed in multiple
counterparts (including facsimile counterparts) which, when signed by all
parties, shall constitute a binding agreement.
IN WITNESS WHEREOF, the parties have executed this First Amendment as
of the date first written above.
XXXXXXX WEST INVESTMENT CORPORATION, a
Delaware corporation
By: /s/
-------------------------------------
Its: President
------------------------------------
29
MERIT 1995 INDUSTRIAL PORTFOLIO LIMITED
PARTNERSHIP,
a Texas limited partnership
By: MTP, Inc., a Texas corporation,
its General Partner
By: /s/
------------------------------
Its: President
------------------------------
30
SECOND AMENDMENT TO PURCHASE AGREEMENT
THIS SECOND AMENDMENT TO PURCHASE AGREEMENT (this "Second Amendment"),
is made as of July 31, 1997, by and between XXXXXXX WEST INVESTMENT
CORPORATION, a Delaware corporation ("Purchaser"), and MERIT 1995 INDUSTRIAL
PORTFOLIO LIMITED PARTNERSHIP, a Texas limited partnership ("Seller"), with
reference to the following facts:
A. Seller and Purchaser entered into that certain Purchase
Agreement, dated as of July 2, 1997, as amended by that certain First Amendment
to Purchase Agreement dated as of July 30, 1997 (collectively, the "Purchase
Agreement"). Each capitalized term used in this Second Amendment, but not
defined herein, shall have the meaning ascribed to it in the Purchase
Agreement.
B. Seller and Purchaser desire to amend the Purchase Agreement as
set forth in this Second Amendment.
NOW, THEREFORE, the parties agree as follow:
1. Deletion of Xxxxxxxxx II Constituent Parcel. The parties
hereto agree that the Purchase Agreement shall be amended to delete all
references to the Constituent Parcel commonly known as Xxxxxxxxx II.
2. Purchase Price. The first sentence of Paragraph 2(a) of the
Purchase Agreement is hereby deleted and restated in its entirety as follows:
"The purchase price of the Property shall be Twelve Million Sixty Two Thousand
Five Hundred Dollars ($12,062,500.00) (the "Purchase Price")."
3. Due Diligence Period. Notwithstanding anything to the
contrary provided in the Purchase Agreement, the Due Diligence Period shall
expire on August 15, 1997.
4. Diligence Period Conditions. Purchaser hereby acknowledges
and agrees that Purchaser has approved or waived all of the Diligence Period
Conditions, other than those items identified on Schedule 1 attached hereto
(the "Open Diligence Items") and that Purchaser has waived its rights under
clauses (iii) and (v) of Paragraph 11(b) of the Purchase Agreement. Purchaser
and Seller acknowledge and agree that Purchaser is retaining the right in its
sole and absolute discretion to approve or disapprove of the Open Diligence
Items set forth in paragraph 1 and 2 of Schedule 1 hereto and to terminate the
Purchase Agreement at any time prior to August 8, 1997 in its sole and absolute
discretion, in which event the Deposit shall be immediately returned to
Purchaser. In the event that Purchaser fails to deliver to Seller an Approval
Notice with respect to the Open Diligence Items set forth in paragraph 1 and 2
of Schedule 1 hereto prior to August 8, 1997, the Purchase Agreement shall
automatically terminate and the Deposit shall be immediately returned to
Purchaser. Purchaser and Seller further acknowledge and agree that Purchaser
is retaining the right in its sole and absolute discretion to approve or
disapprove of the Open Diligence Item set forth in paragraph 3 of Schedule 1
hereto and
31
to terminate the Purchase Agreement at any time prior to the end of the Due
Diligence Period (as amended pursuant to Paragraph 3 above) in its sole and
absolute discretion, in which event the Deposit shall be immediately returned
to Purchaser. In the event that Purchaser fails to deliver to Seller an
Approval Notice with respect to the Open Diligence Item set forth in paragraph
3 of Schedule 1 hereto prior to the end of the Due Diligence Period (as amended
pursuant to Paragraph 3 above), the Purchase Agreement shall automatically
terminate and the Deposit shall be immediately returned to Purchaser. The
parties hereto acknowledge that nothing contained in this Paragraph 4 shall
affect Purchaser's right under Paragraph 6 of the Purchase Agreement to
terminate the Purchase Agreement in its sole and absolute discretion if any
Condition Precedent set forth in Paragraph 6 of the Purchase Agreement (as
amended hereby) is not satisfied, including, without limitation, the Condition
Precedent set forth in Paragraph 6(b) thereof relating to the delivery of
estoppel certificates, or Purchaser's right to approve any title exceptions
first disclosed to Purchaser subsequent to the end of the Due Diligence Period.
5. Additional Closing Condition. Paragraph 6 of the Purchase
Agreement is hereby amended by inserting the following new Paragraph 6(f):
(f) Seller's obtaining and delivering to Purchaser an
estoppel certificate in form reasonably satisfactory to Purchaser with
respect to that certain Lease of Property dated July 25, 1995 between
Missouri Pacific Railroad Company, as lessor, and Seller and Merit
Texas Properties, Inc., as lessee, which estoppel certificate shall
include, without limitation, a consent of the lessor to the assignment
of such Lease to Purchaser.
6. Walnut Oaks Further Environmental Investigations. The parties
hereto agree that in the event that the Closing occurs Seller shall reimburse
Purchaser for fifty percent (50%) of any costs incurred by Purchaser in
connection with performing the further environmental investigations described
on Schedule 1 attached hereto.
7. No other Amendment; Conflict. Except as set forth in this
Second Amendment, the provisions of the Purchase Agreement shall remain in full
force. If any provision of this Second Amendment conflicts with any provision
of the Purchase Agreement, then the provisions of this Second Amendment shall
prevail.
8. Counterparts. This Second Amendment may be signed in multiple
counterparts (including facsimile counterparts) which, when signed by all
parties, shall constitute a binding agreement.
IN WITNESS WHEREOF, the parties have executed this Second Amendment as
of the date first written above.
32
XXXXXXX WEST INVESTMENT CORPORATION, a
Delaware corporation
By: /s/
-----------------------------------
Its: President
-----------------------------------
MERIT 1995 INDUSTRIAL PORTFOLIO LIMITED
PARTNERSHIP,
a Texas limited partnership
By: MTP, Inc., a Texas corporation,
its General Partner
By: /s/
------------------------------
Its: Chief Financial Officer and
Treasurer
33
THIRD AMENDMENT TO PURCHASE AGREEMENT
THIS THIRD AMENDMENT TO PURCHASE AGREEMENT (this "Third Amendment"),
is made as of August 8, 1997, by and between XXXXXXX WEST INVESTMENT
CORPORATION, a Delaware corporation ("Purchaser"), and MERIT 1995 INDUSTRIAL
PORTFOLIO LIMITED PARTNERSHIP, a Texas limited partnership ("Seller"), with
reference to the following facts:
A. Seller and Purchaser entered into that certain Purchase
Agreement, dated as of July 2, 1997, as amended by that certain First Amendment
to Purchase Agreement dated as of July 30, 1997 and that certain Second
Amendment to Purchase Agreement dated as of July 31, 1997 (collectively, the
"Purchase Agreement"). Each capitalized term used in this Third Amendment, but
not defined herein, shall have the meaning ascribed to it in the Purchase
Agreement.
B. Seller and Purchaser desire to amend the Purchase Agreement as
set forth in this Third Amendment.
NOW, THEREFORE, the parties agree as follow:
1. Open Diligence Items. The "August 8, 1997" date set forth in
Paragraph 4 of the Second Amendment to Purchase Agreement referenced in Recital
A above (the "Second Amendment") is hereby deleted each time such date appears
in said Paragraph 4, and the date "August 12, 1997" is hereby inserted in the
place thereof.
2. No other Amendment; Conflict. Except as set forth in this
Third Amendment, the provisions of the Purchase Agreement shall remain in full
force. If any provision of this Third Amendment conflicts with any provision
of the Purchase Agreement, then the provisions of this Third Amendment shall
prevail.
3. Counterparts. This Third Amendment may be signed in multiple
counterparts (including facsimile counterparts) which, when signed by all
parties, shall constitute a binding agreement.
IN WITNESS WHEREOF, the parties have executed this Third Amendment as
of the date first written above.
XXXXXXX WEST INVESTMENT CORPORATION, a
Delaware corporation
By: /s/
-----------------------------------
Its: President
-----------------------------------
34
MERIT 1995 INDUSTRIAL PORTFOLIO LIMITED
PARTNERSHIP,
a Texas limited partnership
By: MTP, Inc., a Texas corporation,
its General Partner
By: /s/
------------------------------
Its: Chief Financial Officer and
Treasurer
35
FOURTH AMENDMENT TO PURCHASE AGREEMENT
THIS FOURTH AMENDMENT TO PURCHASE AGREEMENT (this "Fourth Amendment"),
is made as of August 12, 1997, by and between XXXXXXX WEST INVESTMENT
CORPORATION, a Delaware corporation ("Purchaser"), and MERIT 1995 INDUSTRIAL
PORTFOLIO LIMITED PARTNERSHIP, a Texas limited partnership ("Seller"), with
reference to the following facts:
A. Seller and Purchaser entered into that certain Purchase
Agreement, dated as of July 2, 1997, as amended by that certain First Amendment
to Purchase Agreement dated as of July 30, 1997, that certain Second Amendment
to Purchase Agreement dated as of July 31, 1997 and that certain Third
Amendment to Purchase Agreement dated as of August 8, 1997 (collectively, the
"Purchase Agreement"). Each capitalized term used in this Fourth Amendment,
but not defined herein, shall have the meaning ascribed to it in the Purchase
Agreement.
B. Seller and Purchaser desire to amend the Purchase Agreement as
set forth in this Fourth Amendment.
NOW, THEREFORE, the parties agree as follow:
1. Purchase Price. The first sentence of Paragraph 2(a) of the
Purchase Agreement is hereby deleted and restated in its entirety as follows:
"The purchase price of the Property shall be Eleven Million Eight Hundred
Ninety Five Thousand Eight Hundred Thirty-Three and 33/100 Dollars
($11,895,833.33) (the "Purchase Price")."
2. Allocation of Deposit. The parties hereto acknowledge and
agree that the $30,000 of the Deposit shall be allocated to the Constituent
Parcel commonly known as Walnut Oaks (the "Walnut Oaks Constituent Parcel"),
$30,000 of the Deposit shall be allocated to the Constituent Parcel commonly
known as Parkway Tech Center (the "Parkway Tech Constituent Parcel"), and the
remainder of the Deposit shall be allocated to the other Constituent Parcels.
3. Open Diligence Items. Purchaser acknowledges and agrees that
it has approved of all of the Open Diligence Items set forth on "Schedule 1"
attached to the Second Amendment to Purchase Agreement referenced in Recital A
above. The parties hereto acknowledge that nothing contained in this Paragraph
3 shall affect Purchaser's right under Paragraph 6 of the Purchase Agreement to
terminate the Purchase Agreement in its sole and absolute discretion if any
Condition Precedent set forth in Paragraph 6 of the Purchase Agreement (as
amended by said Second Amendment and by this Fourth Amendment) is not
satisfied, including, without limitation, the Condition Precedent set forth in
Paragraph 6(b) thereof relating to the delivery of estoppel certificates, or
Purchaser's right to approve any title exceptions first disclosed to Purchaser
subsequent to the end of the Due Diligence Period.
36
4. Closing Date. Paragraph 8(b) of the Purchase Agreement is
hereby deleted in its entirety, the following Paragraph 8(b) is hereby inserted
in the place thereof:
(b) The parties shall conduct an escrow Closing pursuant
to this Paragraph 8 on or before October 15, 1997 or on such other
date as Purchaser and Seller may agree in their sole and absolute
discretion (the "Closing Date").
5. Additional Closing Condition. Paragraph 6 of the Purchase
Agreement is hereby amended by inserting the following new Paragraphs 6(g) and
(h):
(g) Seller's obtaining and delivering to Purchaser on or
before September 5, 1997 evidence in form reasonably satisfactory to
Purchaser that the Walnut Oaks Constituent Parcel complies with all
applicable governmental requirements (including, without limitation,
zoning requirements) with respect to parking. Seller shall use its
reasonable efforts to obtain such evidence as soon as reasonably
possible; provided, however, if Seller has been unable to obtain and
deliver such evidence on or before September 5, 1997 despite using its
reasonable efforts to do so, Seller shall have the right to extend
such date until a date no later than October 3, 1997 provided that
Seller continues to use all reasonable efforts to obtain such evidence
as soon as reasonably possible.
(h) Seller's obtaining and delivering to Purchaser on or
before September 5, 1997 evidence in form reasonably satisfactory to
Purchaser that the Parkway Tech Constituent Parcel complies with all
applicable governmental requirements (including, without limitation,
zoning requirements) with respect to parking. Seller shall use its
reasonable efforts to obtain such evidence as soon as reasonably
possible; provided, however, if Seller has been unable to obtain and
deliver such evidence on or before September 5, 1997 despite using its
reasonable efforts to do so, Seller shall have the right to extend
such date until a date no later than October 3, 1997 provided that
Seller continues to use all reasonable efforts to obtain such evidence
as soon as reasonably possible.
6. Failure of Specified Conditions Precedent.
(a) Notwithstanding anything to the contrary provided in
Paragraph 11 of the Purchase Agreement or in any of the Other Agreements, in
the event that the Condition Precedent set forth in Paragraph 6(g) of the
Purchase Agreement (as amended hereby) is not satisfied, Purchaser shall have
the right in its sole and absolute discretion to terminate this Agreement as to
the Walnut Oaks Constituent Parcel only, in which event this Agreement shall be
amended to delete all references to such Constituent Parcel, the portion of the
Deposit allocated to such Constituent Parcel shall be immediately returned to
Purchaser, the Purchase Price shall be reduced by the amount allocated to such
37
Constituent Parcel as set forth on Schedule 4 to the Purchase Agreement, and the
Purchase Agreement and the Other Agreements shall otherwise remain in full force
and effect.
(b) Notwithstanding anything to the contrary provided in
Paragraph 11 of the Purchase Agreement or in any of the Other Agreements, in
the event that the Condition Precedent set forth in Paragraph 6(h) of the
Purchase Agreement (as amended hereby) is not satisfied, Purchaser shall have
the right in its sole and absolute discretion to terminate this Agreement as to
the Parkway Tech Constituent Parcel only, in which event this Agreement shall
be amended to delete all references to such Constituent Parcel, the portion of
the Deposit allocated to such Constituent Parcel shall be immediately returned
to Purchaser, the Purchase Price shall be reduced by the amount allocated to
such Constituent Parcel as set forth on Schedule 4 to the Purchase Agreement,
and the Purchase Agreement and the Other Agreements shall otherwise remain in
full force and effect.
7. No other Amendment; Conflict. Except as set forth in this
Fourth Amendment, the provisions of the Purchase Agreement shall remain in full
force. If any provision of this Fourth Amendment conflicts with any provision
of the Purchase Agreement, then the provisions of this Fourth Amendment shall
prevail.
8. Counterparts. This Fourth Amendment may be signed in multiple
counterparts (including facsimile counterparts) which, when signed by all
parties, shall constitute a binding agreement.
IN WITNESS WHEREOF, the parties have executed this Fourth Amendment as
of the date first written above.
XXXXXXX WEST INVESTMENT CORPORATION, a
Delaware corporation
By: /s/
-----------------------------------
Its: President
-----------------------------------
38
MERIT 1995 INDUSTRIAL PORTFOLIO LIMITED
PARTNERSHIP,
a Texas limited partnership
By: MTP, Inc., a Texas corporation,
its General Partner
By: /s/
------------------------------
Its: President
------------------------------
