EXHIBIT 99.1
PURCHASE AND SALE AGREEMENT
This Purchase and Sale Agreement (this "AGREEMENT") dated as of December
9, 2005 (the "EFFECTIVE DATE"), is made by and between MOUNT CARRIGAIN LP, a
Texas limited partnership ("SELLER"), and HARVARD PROPERTY TRUST, LLC, a
Delaware limited liability company ("PURCHASER").
ARTICLE I
PROPERTY
1.1 SALE AND PURCHASE OF PROPERTY. Seller will sell to Purchaser and
Purchaser will purchase from Seller, upon the terms and conditions hereinafter
set forth, all of Seller's right, title and interest in and to the Property. The
term "PROPERTY" in this Agreement shall include, without limitation, the
following:
(a) All the pieces or parcels of land located in Richardson, Texas,
and described in EXHIBIT A attached hereto, together with all rights,
privileges, servitudes and appurtenances thereunto belonging (hereinafter
referred to as the "LAND");
(b) All buildings and other improvements erected on the Land, more
particularly described as one office building with an address of 0000 Xxxxx
Xxxxx Xxxx, Xxxxxxxxxx, Xxxxx (collectively, the "IMPROVEMENTS");
(c) All right, title and interest of Seller in and to all easements,
rights of way, development rights, riparian and other water access rights,
mineral rights, sewer rights, development and air rights, privileges,
appurtenances and other rights belonging or pertaining to the Land;
(d) All right, title and interest of the Seller in and to (i) any
land lying in the bed of any street, road or avenue opened or proposed, public
or private, in front of or adjoining the Land, (ii) any award made or to be made
in lieu thereof, (iii) any unpaid award for damage to the Land by reason of
change of grade of any street, and (iv) any strips, gaps and gores adjoining or
adjacent to the Land;
(e) All right, title and interest of Seller to those service
contracts described in EXHIBIT F, if any (collectively, the "CONTRACTS");
(f) To the extent assignable, all right, title and interest of
Seller in and to all governmental permits and approvals, all books and records,
and all other intangible assets relating to the Land and the Improvements,
including, without limitation, Seller's right, title and interest in any and all
trade names or logos used by Seller in the operation of the Property;
(g) All right, title and interest of Seller in and to fixtures,
machinery, equipment, articles of personal property and improvements in the
nature of personal property attached or appurtenant to, or located on, or used
in connection with the use or operation of, or used or adapted for use in
connection with the enjoyment or occupancy of, the Land or the Improvements (the
items included herein being hereinafter collectively referred to as the
"PERSONAL PROPERTY"); and
(h) All rights of Seller under the Lease and all modifications and
amendments thereto and renewals or extensions thereof and all security deposits,
if any, made by the tenant pursuant to the Lease.
ARTICLE II
PURCHASE PRICE
2.1 PRICE. In consideration of the covenants herein contained,
Seller hereby agrees to sell, and Purchaser hereby agrees to purchase, the
Property for a total purchase price of Three Million Nine Hundred Fifty Thousand
Dollars ($3,950,000) (the "PURCHASE PRICE"), which will be subject to adjustment
as set forth herein and will be paid by Purchaser as follows:
2.1.1. DEPOSIT. Within two (2) business days from the Effective
Date, Purchaser will deliver to Partners Title Company, 000 Xxxx Xxxxxx,
Xxxxx 0000X, Xxxxxxx, Xxxxx 00000, Attention: Xxxx Xxxxxxxx (the "ESCROW
AGENT") by bank wire of immediately available funds the sum of
Twenty-Five Thousand Dollars ($25,000) (the "INITIAL DEPOSIT") to be
held in escrow by Escrow Agent pursuant to this Agreement. Within 1
business day following the expiration of the Investigation Period,
Purchaser will deliver to Escrow Agent by bank wire of immediately
available funds the sum of $175,000.00 (the "ADDITIONAL DEPOSIT") to be
held in escrow by Escrow Agent pursuant to this Agreement. The Initial
Deposit and the Additional Deposit, when same is deposited with Escrow
Agent, shall be referred to herein collectively as the "DEPOSIT".
2.1.2. BALANCE OF PURCHASE PRICE. Not later than 2 p.m. Dallas,
Texas time on the Closing Date, Purchaser will deliver to Escrow Agent,
by bank wire transfer of immediately available funds, the balance of the
Purchase Price in excess of the Deposit and all interest accrued thereon
plus or minus the prorations and other adjustments pursuant to SECTION
2.3 and SECTION 7.1 of this Agreement.
2.2 INVESTMENTS. Following the collection of the Deposit, Escrow
Agent will, at the direction of Purchaser, invest the Deposit in an
interest-bearing account with a banking institution jointly approved by Seller,
Purchaser and Escrow Agent.
2.3 INTEREST ON THE DEPOSIT. Any interest earned on the Deposit
shall be credited and delivered to the party receiving the Deposit, as
applicable, PROVIDED, HOWEVER, that if the transaction closes, at Closing any
interest earned on the Deposit shall be credited to Purchaser by applying the
same against the Purchase Price.
2.4 INDEPENDENT CONTRACT CONSIDERATION. Upon the Effective Date
hereof, Purchaser shall deliver to Seller a check in the amount of Fifty and
No/100 Dollars ($50.00) ("INDEPENDENT CONTRACT CONSIDERATION"), which amount the
parties hereby acknowledge and agree has been bargained for and agreed to as
consideration for Seller's execution and delivery of this Agreement. The
Independent Contract Consideration is in addition to and independent of any
other consideration or payment provided in this Agreement, and is nonrefundable
in all events.
ARTICLE III
CONDITIONS TO THE PARTIES' OBLIGATIONS
3.1 CONDITIONS TO PURCHASER'S OBLIGATION TO PURCHASE. Purchaser's
obligation to purchase the Property is expressly conditioned upon each of the
following:
3.1.1. PERFORMANCE BY SELLER. Performance in all material
respects of the obligations and covenants of, and deliveries required
of, Seller hereunder.
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3.1.2. DELIVERY OF TITLE AND POSSESSION. Delivery at the
Closing of (i) the Deed and the other documents described in SECTION 4.2
of this Agreement and (ii) possession as provided in SECTION 15.1.
3.1.3. TITLE INSURANCE. Delivery at the Closing of a basic form
of owner's policy of title insurance (the "TITLE POLICY"), or an
irrevocable commitment to issue the same, with liability in the amount
of the Purchase Price issued by Partners Title Company (the "TITLE
COMPANY"), insuring that good and indefeasible fee simple title to the
Real Property vests in Purchaser free and clear of all mortgages, liens,
encumbrances, security interests, covenants, easements and any other
matters affecting title, subject only to the Permitted Encumbrances (as
defined in SECTION 4.2.1 of this Agreement). At its option, Purchaser
may direct the Title Company to issue extended form title insurance and
additional title insurance endorsements if Purchaser pays for the extra
cost of such additional insurance and endorsements, provided that the
Title Company's failure to issue any such additional endorsements shall
not affect Purchaser's obligations under this Agreement.
3.1.4. SELLER'S REPRESENTATIONS. The representations and
warranties by Seller set forth in SECTION 11.1 being true and correct in
all material respects as of the Closing except as modified by notice (in
accordance with SECTION 11.1) to which Purchaser does not object in
writing by the later of (i) three (3) business days after receipt
thereof or (ii) the end of the Investigation Period.
3.1.5. TERMINATION OF MANAGEMENT AGREEMENT. Effective as of the
Closing Date, the termination of all management agreements affecting the
Property.
3.1.6. ESTOPPEL. Delivery five (5) days prior to the Closing of
an executed estoppel certificate from the tenant under the Lease dated
no earlier than thirty (30) days prior to the Closing Date, in
substantially the same form of EXHIBIT J attached hereto.
3.2 CONDITIONS TO SELLER'S OBLIGATION TO SELL. Seller's obligation
to sell is expressly conditioned upon each of the following:
3.2.1. PERFORMANCE BY PURCHASER. Performance in all material
respects of the obligations and covenants of, and deliveries required
of, Purchaser hereunder.
3.2.2. RECEIPT OF PURCHASE PRICE. Receipt of the Purchase Price
and any adjustments due Seller under ARTICLE VII at the Closing in the
manner herein provided.
3.3 FAILURE OF CONDITION. Upon the failure of any of the foregoing
conditions precedent, the party benefited by such failed condition shall have
the option to (a) waive such condition precedent and proceed to Closing, or (b)
terminate this Agreement by sending written notice to the other party on or
before the date of Closing, in which event the Deposit shall be returned to the
party for whom the condition is not satisfied.
ARTICLE IV
PURCHASER'S DELIVERIES AND SELLER'S DELIVERIES TO ESCROW AGENT
4.1 PURCHASER'S DELIVERIES. Purchaser will, at or before the
Closing, deliver to Escrow Agent each of the following:
4.1.1. PURCHASE PRICE. The balance of the Purchase Price as set
forth in SECTION 2.1.2.
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4.1.2. ASSIGNMENT OF LEASES, RENTS, AND CONTRACTS. Four (4)
executed counterparts of the Assignment and Assumption of Lease, Rents,
Contracts and Other Property Interests (the "ASSIGNMENT OF LEASES AND
CONTRACTS") in the form of EXHIBIT C.
4.1.3. XXXX OF SALE. Four (4) executed counterparts of a xxxx
of sale (the "XXXX OF SALE") in the form of EXHIBIT D.
4.1.4. CLOSING STATEMENT. An executed settlement statement
reflecting the prorations and adjustments required under ARTICLE VII.
4.1.5. CASH - PRORATIONS. The amount, if any, required of
Purchaser under ARTICLE VII.
4.2 SELLER'S DELIVERIES. Seller will, at or before the Closing,
deliver to Escrow Agent each of the following:
4.2.1. DEED. A special warranty deed (the "DEED") in the form
of EXHIBIT B with respect to the Real Property, executed and
acknowledged by Seller, pursuant to which Seller shall convey title to
the Real Property subject only to the following (collectively, the
"PERMITTED ENCUMBRANCES"):
(1) Non-delinquent real property taxes and all
assessments and unpaid installments thereof which are not
delinquent, subject to adjustment as provided in this Agreement.
(2) The lease described in EXHIBIT E attached hereto
(the "LEASE").
(3) Any other lien, encumbrance, easement or other
exception or matter voluntarily imposed or consented to by
Purchaser in writing in its sole and absolute discretion prior
to or as of the Closing.
(4) All exceptions (including printed exceptions) to
title contained or disclosed in the Title Commitment other than
Title Objections identified and not thereafter waived by
Purchaser, except that the standard printed exceptions shall be
modified as follows: (a) the exception for restrictive covenants
shall either be deleted or shall list specific restrictions; (b)
the exception for ad valorem taxes shall reflect only taxes for
the current year and subsequent years, and subsequent
assessments for prior years due to changes in land usage or
ownership, and shall be endorsed "not yet due and payable," (c)
there shall be no exception for easements, or claims of
easements, which are not recorded in the public records; (d)
there shall be no exception for "rights of parties in
possession," although there may be an exception for Leases
specifically described in the Title Policy; and (e) any
reference to submitting claims under the Title Policy to
arbitration shall be deleted.
(5) All matters, rights and interests that would be
discovered by an inspection or survey of the Property.
4.2.2. ASSIGNMENT OF LEASES, AND CONTRACTS. Four (4) executed
counterparts of the Assignment of Leases and Contracts, and (whether
through the closing escrow or through such other method of delivery as
the parties may establish) the original executed Lease and Contracts (or
copies if originals are not in Seller's possession).
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4.2.3. XXXX OF SALE. Four (4) executed counterparts of the Xxxx
of Sale.
4.2.4. NOTICES TO TENANT. A notice signed by Seller (or
Seller's manager for the Improvements) addressed to the tenant under the
Lease in the form of EXHIBIT G.
4.2.5. FIRPTA AFFIDAVIT. Four (4) executed copies of an
affidavit in the form of EXHIBIT H with respect to the Foreign
Investment in Real Property Tax Act.
4.2.6. CLOSING STATEMENT. An executed settlement statement
reflecting the prorations and adjustments required under ARTICLE VII.
4.2.7. CASH - PRORATIONS. The amount, if any, required of
Seller under ARTICLE VII.
4.2.8. BILLS-PAID AFFIDAVIT. A "bills paid affidavit" verifying
that there are no unpaid bills, expenses or claims with respect to the
Property which are due and payable.
4.3 FAILURE TO DELIVER. The failure of Purchaser or Seller to make
any delivery required above by and in accordance with this ARTICLE IV which is
not waived by the other party shall constitute a default hereunder by Purchaser
or Seller, as applicable.
ARTICLE V
INVESTIGATION OF PROPERTY
5.1 DELIVERY OF DOCUMENTS. With the exception of the Title
Commitment, which will not be delivered to Purchaser on or before the date that
is five (5) days after the Effective Date, Seller has previously delivered (or
has made available to Purchaser) the following:
5.1.1. TITLE COMMITMENT. A current title commitment covering
the Real Property issued by the Title Company, together with copies of
all documents referred to as exceptions therein (collectively, the
"TITLE COMMITMENT"), together with a copy of Seller's existing owner
policy of title insurance.
5.1.2. SURVEY. The most recent survey of the Real Property (the
"SURVEY") in Seller's possession.
5.1.3. DUE DILIGENCE MATERIALS. The documents and other items
("DUE DILIGENCE MATERIALS") listed on EXHIBIT K attached hereto and made
a part hereof, to the extent same are in Seller's possession.
5.1.4. LEASES AND CONTRACTS. Copies of the Lease and the
Contracts.
5.1.5. PLANS AND SPECIFICATIONS. To the extent in Seller's
possession, copies of all plans and specifications for the Improvements.
5.1.6. REPORTS. Copies of all environmental and property
condition reports prepared by third parties for Seller or in Seller's
possession.
5.1.7. PERMITS. To the extent in Seller's possession, copies of
all governmental permits, certificates of occupancy and approvals, in
each case regarding the Property.
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5.1.8. OPERATING STATEMENTS. To the extent in Seller's
possession, copies of the operating statements for the Property for the
prior twenty-four (24) months.
5.1.9. PROPERTY TAXES. To the extent in Seller's possession,
copies of the ad valorem tax statements with respect to the Property for
the calendar years 2003, 2004 and 2005 (if 2005 is available).
5.1.10. TENANT FINANCIAL INFORMATION. To the extent in Seller's
possession, current financial information on the tenant under the Lease
and the guarantor thereof.
5.1.11. INSURANCE. To the extent in Seller's possession, copies
of Seller's and Tenants' insurance policy with respect to the
Improvements.
5.1.12. WARRANTIES. To the extent in Seller's possession, copies
of active warranties pertaining to the Improvements.
If requested by Seller, Purchaser shall provide written verification of its
receipt of those items listed in this SECTION 5.1.
5.2 PHYSICAL INSPECTION OF PROPERTY.
5.2.1. While this Agreement is in effect, and upon not less
than twenty-four hours' prior written notice from Purchaser, Seller
shall allow Purchaser and Purchaser's engineers, architects or other
employees and agents reasonable access to the Property and to Seller's
records during normal business hours for the limited purposes provided
herein.
5.2.2. Purchaser and its engineers, architects and other
employees and agents may exercise such access solely for the purposes of
(i) reviewing the leases, contracts, books and records relating to the
Property (other than any privileged, proprietary or confidential
records), soil reports, environmental studies and reports, surveys, and
building and systems plans; (ii) reviewing records relating to operating
expenses and other instruments and correspondence relating to the
Property; and (iii) inspecting the physical condition of the Property
and conducting non-intrusive physical and environmental tests and
inspections thereof. PURCHASER SHALL NOT CONDUCT OR ALLOW ANY PHYSICALLY
INTRUSIVE TESTING OF, ON OR UNDER THE PROPERTY WITHOUT FIRST OBTAINING
SELLER'S WRITTEN CONSENT (WHICH CONSENT SHALL BE IN SELLER'S SOLE AND
ABSOLUTE DISCRETION) AS TO THE TIMING AND SCOPE OF THE WORK TO BE
PERFORMED AND THE PARTIES ENTERING INTO AN AMENDMENT HERETO
MEMORIALIZING SUCH SCOPE OF WORK AND ANY ADDITIONAL AGREEMENTS OF THE
PARTIES WITH RESPECT TO SUCH TESTING.
5.2.3. Purchaser agrees that it will cause it and any person
accessing the Property hereunder to be covered by not less than
$1,000,000 commercial general liability insurance (with, in the case of
Purchaser's coverage, a contractual liability endorsement, insuring its
indemnity obligation under this Agreement), insuring all activity and
conduct of such person while exercising such right of access and naming
Seller as insured, issued by a licensed insurance company reasonably
acceptable to Seller.
5.2.4. Purchaser agrees that, in the exercise of the right of
access granted hereby, it will not unreasonably interfere with or permit
unreasonable interference with any person occupying or
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providing service at the Property. Purchaser agrees that it or its
agents will not communicate with the tenant of the Property without the
consent of Seller.
5.2.5. Purchaser agrees to indemnify, defend and hold harmless
Seller, and its affiliates, members, partners, subsidiaries,
shareholders, officers, directors and agents from any loss, injury,
damage, cause of action, liability, claim, lien, cost or expense,
including reasonable attorneys' fees and costs, arising from the
exercise by Purchaser or its employees, consultants, agents or
representatives of the right of access under this Agreement or out of
any of the foregoing. The indemnity in this SECTION 5.2.5 shall survive
the Closing or any termination of this Agreement.
5.2.6. Purchaser agrees to give Seller not less than
twenty-four hours' prior written notice of its intent to conduct any
inspections or tests so that Seller will have the opportunity to have a
representative present during any such inspection or test, the right to
do which Seller expressly reserves. Purchaser agrees to cooperate with
any reasonable request by Seller in connection with the timing of any
such inspection or test. Purchaser agrees to provide Seller upon
Seller's request with a copy of any written inspection or test report or
summary prepared by any third party.
5.2.7. Purchaser agrees that any inspection, test or other
study or analysis of the Property shall be performed at Purchaser's
expense and in strict accordance with applicable law.
5.2.8. Purchaser agrees at its own expense to promptly repair
or restore the Property, or, at Seller's option, to reimburse Seller for
the actual amount of repair or restoration costs, if any inspection or
test requires or results in any damage to or alteration of its
condition. The obligations set forth in this SECTION 5.2.8 shall survive
the Closing or the termination of this Agreement.
5.2.9. Purchaser has advised Seller that Purchaser must cause
to be prepared up to three (3) years of audited financial statements in
respect of the Property in compliance with the policies of Purchaser and
certain laws and regulations, including, without limitation, Securities
and Exchange Commission Regulation S-X, Rule 3-14. Seller agrees to use
reasonable efforts to cooperate with Purchaser's auditors in the
preparation of such audited financial statements (it being understood
and agreed that the foregoing covenant shall survive Closing). Without
limiting the generality of the preceding sentence (i) Seller shall,
during normal business hours, allow Purchaser's auditors reasonable
access to the books and records maintained by Seller (and the Property's
property manager) in respect of the Property; (ii) Seller shall use
reasonable efforts to provide to Purchaser such financial information
and supporting documentation in Seller's possession as are necessary for
Purchaser's auditors to prepare audited financial statements; (iii)
Seller shall make Seller's property manager and Seller's asset manager
in respect of the Property available for interview in connection with
the conduct of such audit; (iv) Seller will, promptly upon request of
Purchaser, provide to Purchaser's auditors a management representation
letter, reasonably satisfactory to Seller and Purchaser's auditors,
addressed to Purchaser's auditors; and (v) if Seller has audited
financial statements with respect to the Property, Seller shall promptly
provide Purchaser's auditors with a copy of such audited financial
statements. If after Closing Seller obtains an audited financial
statement in respect of the Property for a fiscal period in 2004 or 2005
that was not completed at the time of Closing, then Seller shall
promptly provide Purchaser with a copy of such audited financial
statement, and the foregoing covenant shall survive Closing.
5.3 REVIEW/APPROVAL PERIODS. Purchaser shall have the following
review and/or approval periods to do the following:
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5.3.1. TITLE AND SURVEY. Purchaser shall have until 11:59 p.m.
Dallas, Texas time on the date that is ten (10) days after the latter of
the date Purchaser receives the Title Commitment or the date Purchaser
receives the Survey (the "TITLE REVIEW PERIOD") to notify Seller of any
objections (the "TITLE OBJECTIONS") with respect to the Title Commitment
and the Survey based on its review thereof. If Purchaser does not notify
Seller of any Title Objections during the Title Review Period, such
failure shall be conclusively deemed to be full and complete approval of
the Title Commitment and the Survey and any matter disclosed therein,
except for any matters arising after the date of such Title Commitment
and Survey, but then only to the extent that the same are not caused by
the acts or omissions of Purchaser. If Purchaser does notify Seller of
the Title Objections prior to the end of the Title Review Period, Seller
shall have three (3) business days after receipt thereof to notify
Purchaser that Seller (a) will cause or (b) elects not to cause any or
all Title Objections disclosed therein to be removed or insured over by
the Title Company. Seller's failure to notify Purchaser within such
three (3) business day period as to any Title Objection shall be deemed
an election by Seller not to remove or have the Title Company insure
over such Title Objection. If Seller notifies or is deemed to have
notified Purchaser that Seller shall not remove nor have the Title
Company insure over any or all of the Title Objections, Purchaser shall
have until the end of the Investigation Period or the third (3rd)
business day after the expiration of such three (3) business day period,
whichever is later, to (i) terminate this Agreement or (ii) waive such
Title Objections and proceed to closing without any abatement or
reduction in the Purchase Price on account of such Title Objections. If
Purchaser does not give such notice within said three (3) business day
period, Purchaser shall be deemed to have elected to waive such Title
Objections. Notwithstanding, the foregoing, Seller shall be obligated to
pay and discharge from the public records all mortgages and all other
liens and encumbrances affecting the Property that can be cured by the
payment of money and are not caused by the acts or omissions of
Purchaser. In addition, Seller shall use its reasonable, good faith
efforts to remove or cure the Title Objections to Purchaser's reasonable
satisfaction, but shall not be required to incur any costs in excess of
One Thousand Dollars ($1,000) in doing so (other than as provided in
this SECTION 5.3.1) or to institute litigation.
5.3.2. GENERAL INVESTIGATION. In addition, Purchaser shall have
from the date hereof until 11:59 p.m. Dallas, Texas time on the date
that is twenty (20) days from the Effective Date (the "INVESTIGATION
PERIOD") to terminate this Agreement as a result of Purchaser's review
of any documents (other than the Title Commitment or the Survey),
Purchaser's investigation of the Property, or for no reason at all. This
Agreement shall not terminate unless Purchaser notifies Seller in
writing prior to the end of the Investigation Period that it has elected
to terminate this Agreement pursuant to this SECTION 5.3.2.
5.4 EFFECT OF TERMINATION. If this Agreement terminates pursuant to
SECTION 5.3, then subject to SECTION 5.2, the Deposit shall be returned to
Purchaser and all further rights and obligations of the parties shall cease and
terminate without any further liability of either party to the other (except for
those obligations which are specifically provided to survive such termination as
provided in this Agreement).
5.5 NO OBLIGATION TO CURE. Except as is otherwise provided in
SECTION 5.3.1, nothing contained in this Agreement or otherwise shall require
Seller to render its title marketable or to remove or correct any exception or
matter disapproved by Purchaser or to spend any money or incur any expense in
order to do so.
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ARTICLE VI
THE CLOSING
6.1 DATE AND MANNER OF CLOSING. Escrow Agent shall close the escrow
(the "CLOSING") on the date that is ten (10) days after the expiration of the
Investigation Period (the "CLOSING DATE"), time being of the essence (subject
only to Seller's express rights of remedy or cure provided herein, in which
event Seller will give Purchaser not less than three (3) business days notice of
the date of Closing), by recording and delivering all documents and funds as set
forth in ARTICLE VIII.
ARTICLE VII
PRORATION, FEES, COSTS AND ADJUSTMENTS
7.1 PRORATIONS. At least two (2) business days prior to the Closing,
Seller shall determine the amounts of the prorations in accordance with this
Agreement and notify Purchaser thereof. Purchaser shall review and approve or
disapprove such determination promptly and prior to the Closing. Thereafter,
Purchaser and Seller shall each inform Escrow Agent of such amounts.
7.1.1. CERTAIN ITEMS PRORATED. In accordance with the
notifications, Escrow Agent shall prorate between the parties (and the
parties shall deposit funds therefor with Escrow Agent or shall instruct
Escrow Agent to debit against sums held by Escrow Agent owing to such
party), as of 11:59 p.m. the day prior to the Closing, all income and
expenses with respect to the Property and payable to or by the owner of
the Property (and excluding those expenses related to the Property paid
directly by any tenant), including, without limitation: (i) all real
property taxes and assessments on the basis of the fiscal period for
which assessed (if the Closing shall occur before the tax rate is fixed,
the apportionment of taxes shall be based on the tax rate for the
preceding period applied to the latest assessed valuation and after the
Closing, when the actual real property taxes are finally fixed, Seller
and Purchaser shall promptly make a recalculation of such proration, and
the appropriate party shall make the applicable payment reflecting the
recalculation to the other party); (ii) rents and other tenant payments
and tenant reimbursements (collectively, "TENANT PAYMENTS") if any,
received under the Lease; (iii) charges for water, sewer, electricity,
gas, fuel and other utility charges, all of which shall be read promptly
before Closing, unless Seller elects to close its own applicable
account, in which event Purchaser shall open its own account and the
respective charges shall not be prorated; (iv) amounts prepaid and
amounts accrued but unpaid on the Contracts which are to be assumed by
Purchaser; and (v) periodic fees for licenses, permits or other
authorizations with respect to the Property.
7.1.2. TAXES. Real property tax refunds and credits received
after the Closing which are attributable to a fiscal tax year prior to
the Closing shall belong to Seller. Any such refunds and credits
attributable to the fiscal tax year during which the Closing occurs
shall be apportioned between Seller and Purchaser after deducting the
reasonable out-of-pocket expenses of collection thereof. This
apportionment obligation shall survive the Closing.
7.1.3. DELINQUENT TENANT PAYMENTS. Delinquent Tenant Payments,
if any, shall not be prorated and all rights thereto shall be retained
by Seller, who reserves the right to collect and retain such delinquent
Tenant Payments, and Purchaser agrees to cooperate with Seller in
Seller's efforts to collect such Tenant Payments; PROVIDED, HOWEVER,
that Seller shall not be entitled to commence any disposition or
eviction proceeding against the delinquent tenant and Purchaser shall
not be required to spend any money in connection therewith. If at any
time after the Closing Purchaser shall receive any such delinquent
Tenant Payments (all of which Purchaser shall use its good faith efforts
to obtain but shall not be required to incur any cost in connection
therewith), Purchaser shall immediately remit such Tenant Payments to
Seller, provided that any monies
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received by Purchaser from a delinquent tenant shall be applied first to
current rents then due and payable and then to delinquent rents in the
inverse order in which they became due and payable. Seller shall remit
to Purchaser any Tenant Payments it may receive following the Closing
Date, which shall be applied by Purchaser as set forth herein. The
previous two sentences shall survive the Closing.
7.1.4. INSURANCE. Seller's existing liability and property
insurance pertaining to the Property shall be canceled as of the
Closing, and Seller shall receive any premium refund due thereon (which
will be refunded to the tenant pursuant to the provisions of the Lease).
7.1.5. ADJUSTMENTS. All prorations described in this SECTION
7.1 shall be effected by increasing or decreasing, as the case may be,
the amount of cash to be paid by Purchaser to Seller at Closing. Seller
and Purchaser agree to adjust between themselves after Closing any
errors or omissions in the prorations made at Closing; provided,
however, that such prorations shall be deemed final and not subject to
further post Closing adjustment if no such adjustments have been
requested within nine (9) months after the Closing Date.
7.2 SELLER'S CLOSING COSTS. Seller shall pay (i) one-half of Escrow
Agent's escrow fee or escrow termination charge, (ii) the cost of the title
search and issuance of a title commitment and the title premium for the Title
Policy (excluding all endorsements, extended coverage, and modifications to the
Title Policy, other than those that Seller elected to obtain to cure a Title
Objection), and (iii) Seller's own attorneys' fees.
7.3 PURCHASER'S CLOSING COSTS. Purchaser shall pay (i) the cost of
any financing obtained by Purchaser, (ii) one-half of Escrow Agent's escrow fee
or escrow termination charge, (iii) the cost of any title insurance endorsements
or title modifications ordered by Purchaser, (iv) the cost of any new survey of
the Property or any update of the Survey; PROVIDED, HOWEVER, if the transaction
shall close, Seller shall reimburse Purchaser for the cost of the new or updated
survey not to exceed $3,500, (v) any filing fees incurred in recording the Deed
or any other instruments, (vi) any costs incurred in connection with Purchaser's
investigation of the Property pursuant to ARTICLE V, including the cost of any
new environmental assessment commissioned by Purchaser, and (vii) Purchaser's
own attorneys' fees.
ARTICLE VIII
DISTRIBUTION OF FUNDS AND DOCUMENTS
8.1 DELIVERY OF THE PURCHASE PRICE. At the Closing, Escrow Agent
shall deliver the Deposit and the balance of the Purchase Price (subject to
appointments as herein provided) to Seller, and the transaction shall not be
considered closed until such delivery occurs.
8.2 OTHER MONETARY DISBURSEMENTS. Escrow Agent shall, at the
Closing, hold for personal pickup or arrange for wire transfer, (i) to Seller,
or order, as instructed by Seller, all sums and any proration or other credits
to which Seller is entitled and less any appropriate proration or other charges
and (ii) to Purchaser, or order, any excess funds therefore delivered to Escrow
Agent by Purchaser and all sums and any proration or other credits to which
Purchaser is entitled and less any appropriate proration or other charges.
8.3 RECORDED DOCUMENTS. Escrow Agent shall cause the Deed and any
other documents that Seller or Purchaser desires to record to be recorded with
the appropriate county recorder and, after recording, returned to the grantee,
beneficiary or person acquiring rights under said document or for whose benefit
said document was required.
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8.4 DOCUMENTS TO PURCHASER. Escrow Agent shall at the Closing
deliver to Purchaser the following:
(1) one conformed copy of the Deed;
(2) two originals of the Assignment of Lease and Contracts;
(3) two originals of the Xxxx of Sale;
(4) one original of the Notice to Tenant;
(5) two originals of the FIRPTA Affidavit;
(6) one original of the Closing Statement;
(7) one original of the Title Policy;
(8) one original Bills Paid Affidavit; and
(9) each of the other Seller deliveries set forth in SECTION
4.2 to the extent not previously delivered to Purchaser.
8.5 DOCUMENTS TO SELLER. Escrow Agent shall at the Closing deliver
to Seller the following:
(1) one conformed copy of the Deed;
(2) two originals of the Assignment of Lease and Contracts;
(3) two originals of the Xxxx of Sale;
(4) one original of the Notice to Tenant;
(5) two originals of the FIRPTA Affidavit;
(6) one original of the Closing Statement; and
(7) a copy of the Title Policy.
8.6 ALL OTHER DOCUMENTS. Escrow Agent shall at the Closing deliver
each other document received hereunder by Escrow Agent to the person acquiring
rights under said document or for whose benefit said document was required.
ARTICLE IX
RETURN OF DOCUMENTS AND FUNDS UPON TERMINATION
9.1 RETURN OF SELLER'S DOCUMENTS. If escrow or this Agreement is
terminated for any reason, Purchaser shall, within five (5) days following such
termination, deliver to Seller all documents and materials relating to the
Property previously delivered to Purchaser by Seller and copies of all reports,
studies, documents and materials obtained by Purchaser from third parties in
connection with the Property and Purchaser's investigation thereof. Such items
shall be delivered without representation or warranty as to accuracy or
completeness and with no right of Seller to rely thereon without the consent of
the third party. Escrow Agent shall deliver all documents and materials
deposited by Seller and then in Escrow
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Agent's possession to Seller and shall destroy any documents executed by both
Purchaser and Seller. Upon delivery by Escrow Agent to Seller (or such
destruction, as applicable) of such documents and materials, Escrow Agent's
obligations with regard to such documents and materials under this Agreement
shall be deemed fulfilled and Escrow Agent shall have no further liability with
regard to such documents and materials to either Seller or Purchaser.
9.2 RETURN OF PURCHASER'S DOCUMENTS. If escrow or this Agreement is
terminated for any reason, Escrow Agent shall deliver all documents and
materials deposited by Purchaser and then in Escrow Agent's possession to
Purchaser and shall destroy any documents executed by both Purchaser and Seller.
Upon delivery by Escrow Agent to Purchaser (or such destruction, as applicable)
of such documents and materials, Escrow Agent's obligations with regard to such
documents and materials under this Agreement shall be deemed fulfilled and
Escrow Agent shall have no further liability with regard to such documents and
materials to either Seller or Purchaser.
9.3 RETURN OF DEPOSIT. If escrow or this Agreement is terminated (i)
pursuant to SECTION 5.3, SECTION 10.2 or ARTICLE XII, then, subject to SECTION
5.2.8, Purchaser shall be entitled to obtain the return of the Deposit or (ii)
due to the failure of a condition set forth in SECTION 3.1, then, subject to
SECTION 5.2.8, Purchaser shall be entitled to obtain the return of the Deposit.
If the closing of title does not take place and escrow or this Agreement is
terminated for any other reason, Seller shall be entitled to the Deposit.
9.4 DISBURSEMENT OF DEPOSIT. If Escrow Agent receives a notice from
either party instructing Escrow Agent to deliver the Deposit to such party,
Escrow Agent shall deliver a copy of the notice to the other party within three
(3) days after receipt of the notice. If the other party does not object to the
delivery of the Deposit, as applicable, as set forth in the notice within two
(2) business days after receipt of the copy of the notice, Escrow Agent shall,
and is hereby authorized to, deliver the Deposit, as applicable, to the party
requesting it pursuant to the notice. Any objection hereunder shall be by notice
setting forth the nature and grounds for the objection and shall be sent to
Escrow Agent and to the party requesting the Deposit.
9.5 NO EFFECT ON RIGHTS OF PARTIES; SURVIVAL. The return of
documents and monies as set forth above shall not affect the right of either
party to seek such legal or equitable remedies as such party may have under
ARTICLE X with respect to the enforcement of this Agreement. The obligations
under this ARTICLE IX shall survive termination of this Agreement.
ARTICLE X
DEFAULT
10.1 SELLER'S REMEDIES. If, for any reason whatsoever (other than the
failure of a condition set forth in SECTION 3.1 and other than a termination of
this Agreement pursuant to SECTION 5.3, SECTION 10.2 or ARTICLE XII), Purchaser
fails to complete the acquisition as herein provided, Purchaser shall be in
breach of its obligations hereunder and Seller shall be released from any
further obligations hereunder. PURCHASER AND SELLER HEREBY ACKNOWLEDGE AND AGREE
THAT SELLER'S DAMAGES IN THE EVENT OF SUCH A BREACH OF THIS AGREEMENT BY
PURCHASER WOULD BE DIFFICULT OR IMPOSSIBLE TO DETERMINE, THAT THE AMOUNT OF THE
DEPOSIT IS THE PARTIES' BEST AND MOST ACCURATE ESTIMATE OF THE DAMAGES SELLER
WOULD SUFFER IN THE EVENT THE TRANSACTION PROVIDED FOR IN THIS AGREEMENT FAILS
TO CLOSE, AND THAT SUCH ESTIMATE IS REASONABLE UNDER THE CIRCUMSTANCES EXISTING
ON THE DATE OF THIS AGREEMENT. PURCHASER AND SELLER AGREE THAT, OTHER THAN ITS
RIGHT TO ENFORCE THOSE INDEMNITIES AND OBLIGATIONS OF PURCHASER WHICH SURVIVE A
TERMINATION OF THIS AGREEMENT,
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SELLER'S RIGHT TO RETAIN THE DEPOSIT SHALL BE THE SOLE REMEDY OF SELLER AT LAW
OR IN EQUITY IN THE EVENT OF SUCH A BREACH OF THIS AGREEMENT BY PURCHASER.
NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS SECTION 10.1, IF
PURCHASER BRINGS AN ACTION AGAINST SELLER FOR AN ALLEGED BREACH OR DEFAULT BY
SELLER OF ITS OBLIGATIONS UNDER THIS AGREEMENT, RECORDS A LIS PENDENS OR
OTHERWISE ENJOINS OR RESTRICTS SELLER'S ABILITY TO SELL AND TRANSFER THE
PROPERTY EXCEPT AS EXPRESSLY PERMITTED UNDER THIS SECTION 10.1, OR REFUSES TO
CONSENT TO OR INSTRUCT RELEASE OF THE DEPOSIT TO SELLER IF REQUIRED BY ESCROW
AGENT (EACH A "PURCHASER'S ACTION"), SELLER SHALL NOT BE RESTRICTED BY THE
PROVISIONS OF THIS SECTION 10.1 FROM BRINGING AN ACTION AGAINST PURCHASER
SEEKING EXPUNGEMENT OR RELIEF FROM ANY IMPROPERLY FILED LIS PENDENS, INJUNCTION
OR OTHER RESTRAINT, AND/OR RECOVERING FEES, COSTS AND EXPENSES (INCLUDING
ATTORNEYS' FEES) WHICH SELLER MAY SUFFER OR INCUR AS A RESULT OF ANY PURCHASER'S
ACTION BUT ONLY TO THE EXTENT THAT SELLER IS THE PREVAILING PARTY; AND THE
AMOUNT OF ANY SUCH FEES, COSTS AND EXPENSES AWARDED TO SELLER SHALL BE IN
ADDITION TO THE LIQUIDATED DAMAGES SET FORTH HEREIN.
ACCEPTED AND AGREED TO:
---------------------------------- --------------------------------
Seller Purchaser
10.2 PURCHASER'S REMEDIES. Upon the occurrence of a Permitted Event
(as defined below) Purchaser shall be entitled, as its sole and exclusive
remedy, to either (i) terminate this Agreement (by delivering notice to Seller
which includes a waiver of any right, title or interest of Purchaser in the
Property) and, subject to SECTION 5.2.8, obtain the return of the Deposit or
(ii) treat this Agreement as being in full force and effect and, provided
Purchaser commences its specific performance action within thirty (30) days
after the Closing Date (or otherwise waives its specific performance), pursue
only the specific performance of this Agreement; PROVIDED, HOWEVER, if Seller's
default is due solely to Seller's inability to deliver the executed estoppel
certificate specified in SECTION 3.1.6 hereof, then Purchaser's sole and
exclusive remedy shall be limited to terminating this Agreement and obtaining a
return of the Deposit. The term "PERMITTED EVENT" shall mean the occurrence of
all of the following: (1) Purchaser shall be ready, willing and able to complete
closing in accordance with this Agreement on the Closing Date, (2) Purchaser
shall have tendered the Purchase Price and (3) notwithstanding the foregoing,
Seller shall have refused or otherwise failed to complete closing in accordance
with this Agreement. The foregoing limitations shall not apply to Purchaser's
post-Closing remedies with respect to a breach of any representation or warranty
contained herein which shall be governed by the provisions of SECTION 16.8 of
this Agreement. Purchaser waives any right to pursue any other remedy at law or
equity for such default of Seller, including, without limitation, any right to
seek, claim or obtain damages, punitive damages or consequential damages. In no
case shall Seller ever be liable to Purchaser under any statutory, common law,
equitable or other theory of law, either prior to or following the Closing, for
any lost rents, profits, "benefit of the bargain," business opportunities or any
form of consequential damage in connection with any claim, liability, demand or
cause of action in any way or manner relating to the Property, the condition of
the Property, this Agreement, or any transaction or matter between the parties
contemplated hereunder.
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ARTICLE XI
REPRESENTATIONS AND WARRANTIES
11.1 SELLER'S WARRANTIES AND REPRESENTATIONS. The matters set forth
in this SECTION 11.1 constitute representations and warranties by Seller which
are now and (subject to matters contained in any notice given pursuant to the
next succeeding sentence) shall, in all material respects, at the Closing be
true and correct. If Seller has actual knowledge that any of the representations
and warranties contained in this ARTICLE XI may cease to be true, Seller shall
give prompt notice to Purchaser (which notice shall include copies of the
instrument, correspondence, or document, if any, upon which Seller's notice is
based). As used in this SECTION 11.1, the phrase "to Seller's knowledge" shall
mean the actual knowledge of Xxxxxxx X. Xxxxxx. There shall be no duty imposed
or implied to investigate, inquire, inspect, or audit any such matters, and
there shall be no personal liability on the part of such asset manager. To the
extent Purchaser has or acquires actual knowledge or is deemed to know prior to
the expiration of the Investigation Period that these representations and
warranties are inaccurate, untrue or incorrect in any way, such representations
and warranties shall be deemed modified to reflect Purchaser's knowledge or
deemed knowledge. Purchaser shall be deemed to know a representation or warranty
is untrue, inaccurate or incorrect if this Agreement or any files, documents,
materials, analyses, studies, tests, or reports disclosed in writing to
Purchaser prior to the expiration of the Investigation Period contains
information which is inconsistent with such representation or warranty.
11.1.1. NO BROKER. Seller has not engaged or dealt with any
broker or finder in connection with the sale contemplated by this
Agreement, except Marcus and Millichap Real Estate Investment Brokerage
of Texas ("SELLER'S BROKER") and Wicker and Associates ("PURCHASER'S
BROKER"; Seller's Broker and Purchaser's Broker are collectively
referred to herein as the "Broker"). Seller shall pay all brokerage
commissions to Seller's Broker as it may be entitled thereto pursuant to
a separate agreement between Seller and Seller's Broker. Seller shall
indemnify and hold harmless Purchaser from any claims, costs, damages or
liabilities (including attorneys' fees) arising from any breach of the
representation and agreement contained in this SECTION 11.1.1 or if the
same shall be based on any statement, representation or agreement by
Seller with respect to the payment of any brokerage commissions or
finders fees. The foregoing indemnity shall survive the Closing or the
termination of this Agreement.
11.1.2. ORGANIZATION. Seller has been duly formed and validly
exists in the jurisdiction of its formation and in the state in which
the Property is located.
11.1.3. POWER AND AUTHORITY; BINDING OBLIGATION. Seller has the
legal power, right and authority to enter into this Agreement and to
consummate the transactions contemplated hereby. This Agreement has been
duly executed and delivered by Seller, and is enforceable against Seller
in accordance with the terms hereof, except as enforceability may be
limited by bankruptcy, insolvency or reorganization laws or applicable
principles of equity.
11.1.4. PROCEEDINGS. Seller has not received any written notice
of any pending or threatened condemnation or similar proceeding
affecting any part of the Property.
11.1.5. CONTRAVENTION. Seller is not prohibited from
consummating the transactions contemplated by this Agreement by any law,
regulation, agreement, instrument, restriction, order or judgment.
11.1.6. LEASE. The lease described in EXHIBIT E comprises all of
the leases that will affect the Property on and after the Closing, and
to Seller's knowledge, no party thereunder (including Seller and any
tenant thereof) is in default thereunder.
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11.1.7. COMPLIANCE. Seller has not received written notice from
any governmental authority that the Property is not in compliance with
all applicable laws, except for such failures to comply, if any, which
have been remedied and those set forth on the Disclosure Notice attached
hereto at EXHIBIT I (the "DISCLOSURE NOTICE").
11.1.8. LITIGATION. There is no litigation affecting the
Property other than as may be disclosed in the Disclosure Notice. To
Seller's knowledge, no litigation affecting the Property has been
threatened or claims asserted.
11.1.9. ENVIRONMENTAL. To Seller's knowledge, Seller has not
disposed of or otherwise released or allowed to be released any
hazardous or toxic substances, petroleum products, chemicals, or wastes
of any kind on, in, or under the Property, including any surface waters
or groundwater located on such Property, nor to Seller's knowledge, has
Seller caused or allowed to be released or discharged any hazardous or
toxic substances, petroleum products, chemicals, or wastes of any kind
on, in, or under any tracts in proximity to the Property, including the
surface or groundwaters thereof. To Seller's knowledge, there are no
hazardous or toxic substances, petroleum products, chemicals, or wastes
on, in, or under the Property, including surface or groundwaters,
regardless of source or cause, and, to Seller's knowledge, there are no
underground storage tanks on the Property.
11.2 PURCHASER'S WARRANTIES AND REPRESENTATIONS. The matters set
forth in this SECTION 11.2 constitute representations and warranties by
Purchaser, which are now and shall, at the Closing, be true and correct.
11.2.1. NO BROKER. Except for the Broker, Purchaser has not
engaged or dealt with any broker or finder in connection with the sale
contemplated by this Agreement. Purchaser shall indemnify and hold
harmless Seller from any claims, costs, damages or liabilities
(including attorneys' fees) arising from any breach of the
representation contained in this SECTION 11.2.1 or if the same shall be
based on any statement, representation or agreement by Purchaser with
respect to the payment of any brokerage commissions or finders fees. The
foregoing indemnity shall survive the Closing or the termination of this
Agreement.
11.2.2. POWER AND AUTHORITY; BINDING AGREEMENT. Purchaser has
the legal power, right and authority to enter into this Agreement and to
consummate the transactions contemplated hereby. This Agreement has been
duly executed and delivered by Purchaser, enforceable against Purchaser
in accordance with the terms hereof, except as enforceability may be
limited by bankruptcy, insolvency or reorganization laws or applicable
principles of equity.
11.2.3. INDEPENDENT INVESTIGATION. The consummation of this
transaction shall constitute Purchaser's acknowledgment that it has
independently inspected and investigated the Property and has made and
entered into this Agreement based upon such inspection and investigation
and its own examination of the condition of the Property.
11.2.4. PURCHASER RELIANCE. Purchaser is experienced in and
knowledgeable about the ownership and management of real estate, and,
except as expressly set forth in SECTION 11.1, it has relied and will
rely exclusively on its own consultants, advisors, counsel, employees,
agents, principals and/or studies, investigations and/or inspections
with respect to the Property, its condition, value and potential.
Purchaser agrees that, notwithstanding the fact that it has received
certain information from Seller or its agents or consultants, Purchaser
has relied solely upon and
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will continue to rely solely upon its own analysis and will not rely on
any information provided by Seller or its agents or consultants, except
as expressly set forth in SECTION 11.1.
11.3 NO OTHER WARRANTIES AND REPRESENTATIONS. PURCHASER ACKNOWLEDGES
THAT PRIOR TO CLOSING (A) PURCHASER SHALL HAVE CONDUCTED (OR WAIVED ITS RIGHT TO
CONDUCT) ALL SUCH INSPECTIONS, INVESTIGATIONS, TESTS, ANALYSES, APPRAISALS AND
EVALUATIONS OF THE PROPERTY (INCLUDING THOSE FOR HAZARDOUS MATERIALS) AS
PURCHASER CONSIDERS NECESSARY OR APPROPRIATE (ALL OF SUCH INSPECTIONS,
INVESTIGATIONS, TESTS, ANALYSES, APPRAISALS AND EVALUATIONS BEING HEREIN
COLLECTIVELY CALLED THE "INVESTIGATIONS"); AND (B) PURCHASER SHALL HAVE
REVIEWED, EXAMINED, EVALUATED AND VERIFIED ALL DOCUMENTS, LEASES, CONTRACTS,
REPORTS AND OTHER INFORMATION EITHER PROVIDED TO PURCHASER OR MADE AVAILABLE TO
PURCHASER (COLLECTIVELY, THE "DOCUMENTS") WHICH PURCHASER CONSIDERS NECESSARY OR
APPROPRIATE AND THE RESULTS OF THE INVESTIGATIONS TO THE EXTENT IT DEEMS
NECESSARY OR APPROPRIATE WITH THE ASSISTANCE OF SUCH EXPERTS AS PURCHASER SHALL
DEEM APPROPRIATE. PURCHASER ACKNOWLEDGES AND AGREES THAT PRIOR TO CLOSING IT (X)
SHALL BE FAMILIAR WITH THE PHYSICAL CONDITION OF THE PROPERTY, (Y) SHALL HAVE
COMPLETED ITS DUE DILIGENCE WITH RESPECT TO THE PROPERTY TO ITS SATISFACTION,
AND (Z) EXCEPT FOR SELLER'S REPRESENTATIONS AND WARRANTIES SET FORTH IN SECTION
11.1 AND THE SPECIAL WARRANTY OF TITLE SET FORTH IN THE DEED (COLLECTIVELY, THE
"SELLER'S WARRANTIES"), SHALL ACQUIRE THE PROPERTY BASED EXCLUSIVELY UPON ITS
OWN INVESTIGATIONS AND INSPECTIONS OF THE PROPERTY AND THE DOCUMENTS, AND EXCEPT
FOR A BREACH OF SELLER'S WARRANTIES, HEREBY WAIVES ANY RIGHT TO ASSERT A CLAIM
AGAINST SELLER FOLLOWING THE CLOSING AS TO THE CONDITION, CHARACTER OR STATUS
(ECONOMIC, PHYSICAL OR OTHERWISE) OF THE PROPERTY. PURCHASER ACKNOWLEDGES AND
AGREES THAT, EXCEPT FOR SELLER'S WARRANTIES, THE PROPERTY SHALL BE SOLD, AND
PURCHASER SHALL ACCEPT POSSESSION OF THE PROPERTY ON THE DATE OF CLOSING, "AS
IS, WHERE IS, WITH ALL FAULTS", WITH NO RIGHT OF SETOFF OR REDUCTION IN THE
PURCHASE PRICE; EXCEPT FOR SELLER'S WARRANTIES, NO PERSON HAS OR SHALL BE DEEMED
TO HAVE MADE ANY VERBAL OR WRITTEN REPRESENTATIONS, WARRANTIES, PROMISES OR
GUARANTEES (WHETHER EXPRESS, IMPLIED, STATUTORY OR OTHERWISE) TO PURCHASER WITH
RESPECT TO THE PROPERTY, ANY MATTER SET FORTH, CONTAINED OR ADDRESSED IN THE
DOCUMENTS (INCLUDING, BUT NOT LIMITED TO, THE ACCURACY AND COMPLETENESS THEREOF)
OR THE RESULTS OF ANY INSPECTIONS, INVESTIGATIONS, TESTS, ANALYSES, APPRAISALS
AND EVALUATIONS OF THE PROPERTY (INCLUDING THOSE FOR HAZARDOUS MATERIALS) THAT
ARE CONDUCTED BY PURCHASER; AND PURCHASER SHALL CONFIRM INDEPENDENTLY ALL
INFORMATION THAT IT CONSIDERS MATERIAL TO ITS PURCHASE OF THE PROPERTY.
PURCHASER SPECIFICALLY ACKNOWLEDGES THAT, EXCEPT FOR SELLER'S WARRANTIES,
PURCHASER IS NOT RELYING ON (AND SELLER DOES HEREBY DISCLAIM AND RENOUNCE) ANY
REPRESENTATIONS OR WARRANTIES OF ANY KIND OR NATURE WHATSOEVER, WHETHER ORAL OR
WRITTEN, EXPRESS, IMPLIED, STATUTORY OR OTHERWISE, FROM SELLER, AS TO: (A) THE
OPERATION OF THE PROPERTY OR THE INCOME POTENTIAL, USES, OR THE MERCHANTABILITY,
HABITABILITY OR FITNESS OF ANY PORTION OF THE PROPERTY FOR A PARTICULAR PURPOSE;
(B) THE PHYSICAL CONDITION OF THE PROPERTY OR THE CONDITION OR SAFETY OF THE
PROPERTY OR ANY IMPROVEMENTS THEREON,
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INCLUDING, BUT NOT LIMITED TO, PLUMBING, SEWER, HEATING, VENTILATING AND
ELECTRICAL SYSTEMS, ROOFING, AIR CONDITIONING, FOUNDATIONS, SOILS AND GEOLOGY,
INCLUDING HAZARDOUS MATERIALS, LOT SIZE, OR SUITABILITY OF THE PROPERTY OR ANY
IMPROVEMENTS THEREON FOR A PARTICULAR PURPOSE; (C) THE PRESENCE OR ABSENCE,
LOCATION OR SCOPE OF ANY HAZARDOUS MATERIALS IN, AT, ABOUT OR UNDER THE
PROPERTY; (D) WHETHER THE APPLIANCES, IF ANY, PLUMBING OR UTILITIES ARE IN
WORKING ORDER; (E) THE HABITABILITY OR SUITABILITY FOR OCCUPANCY OF ANY
STRUCTURE AND THE QUALITY OF ITS CONSTRUCTION; (F) WHETHER THE IMPROVEMENTS ARE
STRUCTURALLY SOUND, IN GOOD CONDITION, OR IN COMPLIANCE WITH ANY OR ALL
APPLICABLE LAWS; (G) THE DIMENSIONS OF THE PROPERTY OR THE ACCURACY OF ANY FLOOR
PLANS, SQUARE FOOTAGE, LEASE ABSTRACTS, SKETCHES, REVENUE OR EXPENSE PROJECTIONS
RELATED TO THE PROPERTY; (H) THE ECONOMIC STATUS OF THE PROPERTY; (I) THE
ABILITY OF PURCHASER TO OBTAIN ANY AND ALL NECESSARY GOVERNMENTAL APPROVALS OR
PERMITS FOR PURCHASER'S INTENDED USE AND DEVELOPMENT OF THE PROPERTY; AND (J)
THE LEASING STATUS OF THE PROPERTY OR THE INTENTIONS OF ANY PARTIES WITH RESPECT
TO THE NEGOTIATION AND/OR EXECUTION OF ANY LEASE FOR ANY PORTION OF THE
PROPERTY. PURCHASER FURTHER ACKNOWLEDGES AND AGREES THAT, EXCEPT FOR SELLER'S
WARRANTIES, SELLER IS UNDER NO DUTY TO MAKE ANY AFFIRMATIVE DISCLOSURES OR
INQUIRY REGARDING ANY MATTER WHICH MAY OR MAY NOT BE KNOWN TO SELLER, ITS
PARTNERS, OFFICERS, DIRECTORS, CONTRACTORS, AGENTS OR EMPLOYEES. AS USED HEREIN,
"HAZARDOUS MATERIAL" SHALL MEAN ANY SUBSTANCE, CHEMICAL, WASTE OR MATERIAL THAT
IS OR BECOMES REGULATED BY ANY FEDERAL, STATE OR LOCAL GOVERNMENTAL AUTHORITY
BECAUSE OF ITS TOXICITY, INFECTIOUSNESS, RADIOACTIVITY, EXPLOSIVENESS,
IGNITABILITY, CORROSIVENESS OR REACTIVITY, INCLUDING, WITHOUT LIMITATION,
ASBESTOS OR ANY SUBSTANCE CONTAINING MORE THAN 0.1 PERCENT ASBESTOS, THE GROUP
OF COMPOUNDS KNOWN AS POLYCHLORINATED BIPHENYLS, FLAMMABLE EXPLOSIVES, OIL,
PETROLEUM, ANY REFINED PETROLEUM PRODUCT AND, WHETHER REGULATED OR NOT, ANY
MOLD, MICRO TOXINS OR MICROBIAL MATTER. THE TERMS OF THIS SECTION 11.3 SHALL
SURVIVE THE CLOSING AND NOT BE MERGED THEREIN. NOTHING CONTAINED HEREIN OR
OTHERWISE SHALL BE CONSTRUED OR OTHERWISE BE DEEMED TO INDICATE THAT PURCHASER
HAS ASSUMED, OR AGREED TO INDEMNIFY SELLER FOR, ANY LIABILITY (INCLUDING,
WITHOUT LIMITATION, LIABILITY FOR MOLD OR ANY HAZARDOUS SUBSTANCES) OR
OBLIGATION WITH RESPECT TO THE PROPERTY ALLOCABLE TO THE PERIOD PRIOR TO THE
DATE OF CLOSING.
ARTICLE XII
CASUALTY AND CONDEMNATION
Promptly upon learning thereof, Seller shall give Purchaser written
notice of any condemnation, damage or destruction of the Property occurring
prior to the Closing. If prior to the Closing all or a material portion of the
Property is condemned, damaged or destroyed by an insured casualty, Purchaser
shall have the option of either (I) applying the proceeds of any condemnation
award or payment under any insurance policies (other than business interruption
or rental loss insurance) toward the payment of the Purchase Price to the extent
such condemnation awards or insurance payments have been received by Seller,
receiving from Seller an amount equal to any applicable deductible under any
such insurance policy and receiving an assignment from Seller of Seller's right,
title and interest in any such awards or payments not theretofore received by
Seller, or (ii) terminating this Agreement by delivering written
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notice of such termination to Seller and Escrow Agent within ten (10) days after
Purchaser has received written notice from Seller of such material condemnation,
damage or destruction. If, prior to the Closing, a portion of the Property is
condemned, damaged or destroyed and such portion is not a material portion of
the Property, the proceeds of any condemnation award or payment and any
applicable deductible under any insurance policies shall be applied toward the
payment of the Purchase Price to the extent such condemnation awards or
insurance payments have been received by Seller and if such awards or payments
have not been received by Seller, Seller shall assign to Purchaser all of
Seller's right, title and interest in any unpaid awards or payments. For
purposes of this ARTICLE XII, the term "material portion" shall mean (i) damage
requiring more than $100,000 to repair or restore as determined by a reputable
general contractor in the Dallas, Texas area who regularly performs the type of
work required or an absence of reasonable access to the Property, or (ii) a
condemnation involving any portion of the parking areas or driveways, or any
means of ingress thereto or egress therefrom, or (iii) a condemnation or
casualty that otherwise permits the tenant under the Lease to terminate the
Lease, but only to the extent that the tenant under the Lease has not elected to
waive such termination prior to Closing. If the damage or destruction arises out
of an uninsured risk, or if the cost to repair the damage or destruction exceeds
the amount of any insurance proceeds or the amount of insurance proceeds
confirmed in writing to be paid, Seller shall elect, by written notice within
ten (10) days of the occurrence of such damage or destruction either to
terminate this Agreement or to close the transaction contemplated hereby with a
reduction of the Purchase Price equal to the costs of repairing the Property, as
reasonably estimated by an engineer engaged by Seller and reasonably acceptable
to Purchaser.
ARTICLE XIII
CONDUCT PRIOR TO CLOSING
13.1 CONDUCT. From and after the date hereof, Seller shall continue
to operate, maintain and manage the Property in accordance with its regular and
customary procedures.
(i) Seller shall not remove any fixtures or Personal
Property from the Property unless such removal is in the ordinary course
of business and is due to obsolescence or is for the purpose of
repairing, maintaining or replacing such property, in which event such
fixtures or Personal Property shall be promptly serviced and/or
replaced.
(ii) Seller shall promptly notify Purchaser of any fire or
other casualty loss, or receipt of notice of condemnation or violation
of any health, safety, fire, environmental, zoning code or other
ordinance.
13.2 ACTIONS PROHIBITED. Seller shall not, without the prior written
approval of Purchaser, which approval will not be unreasonably withheld or
delayed:
(i) make any material structural alterations or additions to
the Property except as (a) in the ordinary course of operating the
Property, (b) required for maintenance and repair, (c) required by any
Lease or any of the Contracts or (d) required by this Agreement;
(ii) sell, transfer, encumber or change the status of title
of all or any portion of the Property;
(iii) change or attempt to change, directly or indirectly, the
current zoning of the Property; or
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(iv) cancel, amend or modify, in a manner materially adverse
to the Property, any license or permit held by Seller with respect to
the Property or any part thereof which would be binding upon Purchaser
after the Closing.
13.3 MODIFICATION OF EXISTING LEASE AND CONTRACTS. After the
expiration of the Investigation Period, Seller may not cancel, amend, or modify
any material Contracts or the Lease, in a manner binding upon Purchaser after
the Closing, unless (i) Purchaser consents in writing, which consent shall not
be unreasonably withheld or delayed, to such cancellation, amendment, or
modifications, (ii) Seller is terminating a Contract as a result of a material
default thereunder or (iii) such cancellation, amendment, or modification is
required by any of the Contracts. If Seller shall request Purchaser's approval
to any of the foregoing matters, Purchaser shall have five (5) days from its
receipt of such request to give Seller notice of its approval or disapproval of
such matter. If Purchaser does not give such notice, such matter shall be deemed
approved by Purchaser.
13.4 NEW CONTRACTS. Prior to the expiration of the Investigation
Period, Seller may enter into any new service contract affecting the Property,
or any part thereof, PROVIDED such new service contract is being entered into in
accordance with Seller's standard business procedures and Seller gives Purchaser
prompt written notice thereof (and in any event prior to the expiration of the
Investigation Period). After the expiration of the Investigation Period, Seller
may not enter into any new service contract without Purchaser's consent, which
consent will not be unreasonably withheld or delayed. Notwithstanding the
preceding sentence, after the expiration of the Investigation Period, Seller may
enter into any new service contract without Purchaser's consent if doing so is
in the ordinary course of operating the Property and the service contract (i)
will not be binding on Purchaser or (ii) is cancelable on thirty (30) days or
less notice without penalty or premium. If Seller shall request Purchaser's
approval to any of the foregoing matters, Purchaser shall have five (5) days
from its receipt of such request to give Seller notice of its approval or
disapproval of such matter. If Purchaser does not give such notice, such matter
shall be deemed approved by Purchaser.
13.5 CONFIDENTIALITY. Seller and Purchaser shall, prior to the
Closing, maintain the confidentiality of this sale and purchase and shall not,
except as required by law or governmental regulation applicable to Seller or
Purchaser, disclose the terms of this Agreement or of such sale and purchase to
any third parties whomsoever other than investors or prospective investors in
Seller or Purchaser or the principals of the Broker, Escrow Agent, the Title
Company and such other persons whose assistance is required in carrying out the
terms of this Agreement. Seller and Purchaser shall not at any time prior to or
following the Closing Date issue a press release or otherwise communicate with
media representatives regarding this sale and purchase unless such release or
communication has received the prior approval of the other party. Purchaser
agrees that all documents and non-public information regarding the Property of
whatsoever nature made available to it by Seller or Seller's agents and the
results of all tests and studies of the Property (collectively, the "PROPRIETARY
INFORMATION") are confidential and Purchaser shall not disclose any Proprietary
Information to any other person except those assisting it with the analysis of
the Property and those who may provide financing to Purchaser, and their
advisors, and only after procuring such person's agreement to abide by these
confidentiality restrictions. The provisions of this SECTION 13.5 relating to
the approval of a press release or other communication shall survive any
termination of this Agreement. However, notwithstanding the foregoing provisions
or anything else to the contrary contained in this Agreement (i) the foregoing
covenant of confidentiality shall not be applicable to any information published
by Seller as public knowledge or otherwise available in the public domain; (ii)
Purchaser shall be permitted to disclose such information as may be recommended
by Purchaser's legal counsel in order to comply with all financial reporting,
securities laws and other legal requirements applicable to Purchaser, including
any required disclosures to the Securities and Exchange Commission; and (iii)
any duty of confidentiality set forth in this Agreement shall terminate upon
Closing. Purchaser may disclose to any and all persons, without limitation of
any kind, the
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tax treatment and tax structure of the transaction and all materials of any kind
(including opinions or other tax analyses) that are provided to any of them
relating to such tax treatment and tax structure, except to the extent that
confidentiality is reasonably necessary to comply with U.S. federal or state
securities laws.
13.6 RIGHT TO CURE. If any title defect or other matter which would
entitle Purchaser to terminate this Agreement shall first arise after Purchaser
notifies Seller of its Title Objections pursuant to SECTION 5.3.1 and prior to
the Closing or if Seller shall have breached any representation or warranty
hereunder, Seller may elect, by written notice to Purchaser, to cure such title
defect or other matter by causing it to be removed, insured over or bonded to
cure such breach and Seller may adjourn the Closing for up to fifteen (15) days
to do so. Except as otherwise provided in this Agreement, nothing contained in
this SECTION 13.6 shall require Seller to cure any such title defect or other
matter or to incur any liability or expense to do so.
13.7 EXCLUSIVE. Until this Agreement is terminated, Seller will cease
its marketing efforts and will not solicit, negotiate or enter into any backup
letters of intent, proposals, options or contracts with regard to the purchase
and sale of the Property.
ARTICLE XIV
NOTICES
All notices, demands or other communications given hereunder shall be in writing
and shall be deemed to have been duly delivered (i) upon the delivery (or
refusal to accept delivery) by messenger or overnight express delivery service
(or, if such date is not on a business day, on the business day next following
such date), or (ii) on the third (3rd) business day next following the date of
its mailing by certified mail, postage prepaid, at a post office maintained by
the United States Postal Service, or (iii) upon the receipt by facsimile
transmission as evidenced by a receipt transmission report (followed by delivery
by one of the other means identified in (i)-(ii)), addressed as follows:
If to Purchaser, to: Harvard Property Trust, LLC
00000 Xxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attn: Xxx Xxxx
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
With a copy to: Xxxxxx & Xxxxxxx, L.L.P.
0000 X. Xxxxxxx Xxxxxxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attn: Xxxxxxx Xxxxxx
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
If to Seller, to: Mount Carrigain LP
c/o Hampshire Capital Corporation
0000 Xxxxxxx Xxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000
Attn: Xxxxxxx X. Xxxxxx
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
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With a copy to: Gardere Xxxxx Xxxxxx LLP
3000 Thanksgiving Tower
0000 Xxx Xxxxxx
Xxxxxx, Xxxxx 00000
Attn: Xxxxx X. Xxxxxx and Xxxxxxx X. Xxxxxx
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
If to Escrow Agent, to: Partners Title Company
000 Xxxx Xxxxxx, Xxxxx 0000X
Xxxxxxx, Xxxxx 00000
Attn: Xxxx Xxxxxxxx
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
Either party may, by notice given as aforesaid, change the address or addresses,
or designate an additional address or additional addresses, for its notices,
provided, however, that no notice of a change of address shall be effective
until actual receipt of such notice.
ARTICLE XV
TRANSFER OF TITLE AND POSSESSION; INDEMNITY
15.1 TRANSFER OF POSSESSION. Possession of the Property shall be
transferred to Purchaser at the time of Closing subject only to the Lease and to
the Permitted Encumbrances.
15.2 DELIVERY OF DOCUMENTS AT CLOSING. At the time of Closing, Seller
shall deliver to Purchaser originals or copies of any additional documents,
instruments or records in the possession of Seller or its agents which are
necessary for the ownership and operation of the Property.
15.3 POST CLOSING INDEMNIFICATION. Each of Seller and Purchaser
hereby agrees to indemnify, defend and hold harmless the other from and against
any and all claims by, and liabilities to, third parties on account of personal
injury or property damage, affecting or related to the Property or the ownership
or operation thereof, including, without being limited to, reasonable attorneys'
fees and disbursements, arising out of (i) in the case of the indemnification
hereunder by Seller, events or circumstances occurring at the Property on or
after Seller's acquisition of the Property and on or before the Closing which
are or would be covered by a standard commercial general liability policy of
insurance and (ii) in the case of indemnification hereunder by Purchaser, events
or circumstances occurring at the Property after the Closing during Purchaser's
ownership of the Property which are or would be covered by a standard commercial
general liability policy of insurance.
ARTICLE XVI
GENERAL PROVISIONS
16.1 CAPTIONS. Captions in this Agreement are inserted for
convenience of reference only and do not define, describe or limit the scope or
the intent of this Agreement or any of the terms hereof.
16.2 EXHIBITS. All exhibits referred to herein and attached hereto
are a part hereof.
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16.3 ENTIRE AGREEMENT. This Agreement contains the entire agreement
between the parties relating to the transaction contemplated hereby and all
prior or contemporaneous agreements, understandings, representations and
statements, oral or written, are merged herein.
16.4 MODIFICATION. No modification, waiver, amendment, discharge or
change of this Agreement shall be valid unless the same is in writing and signed
by the party against which the enforcement of such modification, waiver,
amendment, discharge or change is or may be sought.
16.5 ATTORNEYS' FEES. Should any party hereto employ an attorney for
the purpose of enforcing or construing this Agreement, or any judgment based on
this Agreement, in any legal proceeding whatsoever, including insolvency,
bankruptcy, arbitration, declaratory relief or other litigation, the prevailing
party shall be entitled to receive from the other party or parties thereto
reimbursement for all reasonable attorneys' fees and all costs, whether incurred
at the trial or appellate level, including but not limited to service of
process, filing fees, court and court reporter costs, investigative costs,
expert witness fees and the cost of any bonds, whether taxable or not, and such
reimbursement shall be included in any judgment, decree or final order issued in
that proceeding. The "prevailing party" means the party in whose favor a
judgment, decree, or final order is rendered.
16.6 GOVERNING LAW. This Agreement shall be construed and enforced in
accordance with the laws of the State in which the Property is located.
16.7 TIME OF ESSENCE. Time is of the essence to this Agreement and to
all dates and time periods set forth herein.
16.8 SURVIVAL OF WARRANTIES. Only the warranties and representations
contained in SECTIONS 11.1 and 11.2 and the provisions of SECTION 11.3 shall
survive the Closing, the delivery of the Deed and the payment of the Purchase
Price, PROVIDED that (i) such representations and warranties (but not such
provisions) shall cease and terminate on the earlier to occur of (a) nine (9)
months after Closing and (b) December 15, 2006, or in respect of any
representation or warranty as to which Purchaser or Seller, as the case may be,
shall have commenced, on or before such nine month period or December 15, 2006,
whichever is earlier, a legal proceeding based on the breach thereof as of the
date of Closing, and then only for so long as such proceeding shall continue and
limited to the breach therein claimed, (ii) Seller shall have no liability to
Purchaser with respect thereto unless and until the damages suffered by
Purchaser as a result thereof shall equal or exceed $25,000 in the aggregate,
and (iii) the maximum total liability for which Seller shall be responsible with
respect to all representations and warranties shall not exceed $250,000 in the
aggregate. Unless otherwise expressly herein stated to survive, all other
representations, covenants, indemnities, conditions and agreements contained
herein shall merge into and be superseded by the various documents executed and
delivered at Closing and shall not survive the Closing. Seller shall have no
liability to Purchaser after Closing for any matter disclosed by Seller or
learned by Purchaser prior to Closing.
16.9 ASSIGNMENT BY PURCHASER. Purchaser may not assign its rights
under this Agreement, except Purchaser may take title to the Property in the
name of an affiliate, provided, (a) Purchaser delivers to Seller written notice
of its intention to do so at least five (5) business days prior to Closing,
which notice shall include the legal name and structure of the proposed
assignee, as well as any other information that Seller may reasonably request,
(b) Purchaser and the proposed assignee shall execute an assignment and
assumption of this Agreement in form and substance reasonably satisfactory to
Seller, and (c) in no event shall any assignment of this Agreement release or
discharge Purchaser from any liability or obligation hereunder.
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16.10 SEVERABILITY. If any term, covenant, condition, provision or
agreement herein contained is held to be invalid, void or otherwise
unenforceable by any court of competent jurisdiction, the fact that such term,
covenant, condition, provision or agreement is invalid, void or otherwise
unenforceable shall in no way affect the validity or enforceability of any other
term, covenant, condition, provision or agreement herein contained.
16.11 SUCCESSORS AND ASSIGNS. All terms of this Agreement shall be
binding upon, inure to the benefit of and be enforceable by, the parties hereto
and their respective legal representatives, successors and assigns (subject to
SECTION 16.9).
16.12 INTERPRETATION. Seller and Purchaser acknowledge each to the
other that both they and their counsel have reviewed and revised this Agreement
and that the normal rule of construction to the effect that any ambiguities are
to be resolved against the drafting party shall not be employed in the
interpretation of this Agreement or any amendments or exhibits hereto.
16.13 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which so executed shall be deemed an original; such
counterparts shall together constitute but one agreement.
16.14 RECORDATION. This Agreement may not be recorded and any attempt
to do so shall be of no effect whatsoever.
16.15 LIMITATION ON LIABILITY. In any action brought to enforce the
obligations of Seller under this Agreement or any other document delivered in
connection herewith, the judgment or decree shall be subject to the provisions
of SECTION 16.8 and shall, otherwise in any event, be enforceable against Seller
only up to a maximum of $250,000.00. No shareholder, officer, limited partner,
employee or agent of Seller shall be held to any personal liability hereunder,
and no resort shall be had to their property or assets, other than the Property,
for the satisfaction of any claims hereunder or in connection with the affairs
of Seller.
16.16 BUSINESS DAY. As used in this Agreement, "business day" shall be
deemed to be any day other than a Saturday, Sunday or any other day on which
banks in the state of Texas shall be permitted or required to close. If any date
set forth in this Agreement for the performance of any obligation by Purchaser
or Seller or for the delivery of any instrument or notice should be on other
than a business day, the compliance with such obligations shall be deemed
acceptable on the next following business day.
16.17 REPORTS. Escrow Agent shall be responsible for the timely filing
of any reports or returns required pursuant to the provisions of Section 6045(e)
of the Internal Revenue Code of 1986 (and any similar reports or returns
required under any state or local laws) in connection with the closing of the
transaction contemplated by this Agreement.
16.18 SURVIVAL. The provisions of SECTIONS 16.1 through 16.8, 16.10
through 16.15, and 16.17 shall survive Closing.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK - SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, this Agreement has been executed as of the date
first set forth above.
SELLER:
MOUNT CARRIGAIN LP,
a Texas limited partnership
By: Hampshire Realty Company, LLC,
a Texas limited liability company,
its general partner
By:_____________________________________
Printed Name:___________________________
Title:__________________________________
PURCHASER:
HARVARD PROPERTY TRUST, LLC,
a Delaware limited liability company
By:_____________________________________________
Printed Name:___________________________________
Title:__________________________________________
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CONSENT AND AGREEMENT OF ESCROW AGENT
The undersigned Escrow Agent hereby agrees to (i) accept the foregoing
Agreement, (ii) be escrow agent under said Agreement, and (iii) be bound by said
Agreement in the performance of its duties as escrow agent.
PARTNERS TITLE COMPANY
By:_____________________________________________
Printed Name:___________________________________
Title:__________________________________________
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EXHIBIT A
---------
DESCRIPTION OF LAND
[Attached]
EXHIBIT B
---------
SPECIAL WARRANTY DEED
STATE OF TEXAS ss.
ss. KNOW ALL MEN BY THESE PRESENTS:
COUNTY OF DALLAS ss.
THAT, MOUNT CARRIGAIN LP, a Texas limited partnership ("GRANTOR"), for
and in consideration of the sum of Ten Dollars ($10.00) in hand paid to Grantor
by ___________________ (herein referred to as "GRANTEE"), whose mailing address
is ______________________________, and other good and valuable consideration,
the receipt and sufficiency of which consideration are hereby acknowledged, has
GRANTED, SOLD and CONVEYED and by these presents does GRANT, SELL and CONVEY
unto Grantee those certain tracts of real property located in Dallas County,
Texas, being more particularly described on Exhibit "A" attached hereto,
incorporated herein and made a part hereof for all purposes, together with all
improvements and fixtures situated thereon and any and all appurtenances
belonging or appertaining thereto (said real property and fixtures together with
any and all of the related rights and appurtenances being herein collectively
referred to as the "PROPERTY").
TO HAVE AND TO HOLD the Property together with all and singular the
rights and appurtenances thereto in anywise belonging unto Grantee, its
successors and assigns forever, subject to the matters herein stated; and
Grantor does hereby bind itself and its successors and assigns to warrant and
forever defend all and singular the Property unto Grantee, its successors and
assigns, against every person whomsoever lawfully claiming or to claim the same
or any part thereof, by, through or under Grantor but not otherwise; provided
that this conveyance and the warranty of Grantor herein contained are subject to
the matters described on Exhibit "B" attached hereto, to the full extent same
are valid and pertain to the Property.
All ad valorem taxes and assessments for the Property for the current
calendar year have been prorated and Grantee hereby expressly assumes liability
for the payment thereof and for subsequent years. If such proration was based
upon an estimate of such taxes and assessments for the current calendar year,
then upon demand Grantor and Grantee shall promptly and equitably adjust all
such taxes and assessments as soon as actual figures for these items for the
current calendar year are available.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK - SIGNATURE PAGE
FOLLOWS]
GRANTOR:
MOUNT CARRIGAIN LP,
a Texas limited partnership
By: Hampshire Realty Company, LLC,
a Texas limited liability company,
its general partner
By:_____________________________________
Printed Name:___________________________
Title:__________________________________
STATE OF _________________ ss.
ss.
COUNTY OF ________________ ss.
The foregoing instrument was acknowledged on ______________________,
2005, by __________________, the __________________ of Hampshire Realty Company,
LLC, a Texas limited liability company, the general partner of MOUNT CARRIGAIN
LP, a Texas limited partnership, on behalf of said entities.
________________________________________
Notary Public, State of ________________
EXHIBIT C
---------
ASSIGNMENT AND ASSUMPTION OF LEASE, RENTS,
CONTRACTS AND OTHER PROPERTY INTERESTS
For good and valuable consideration, the receipt of which is hereby
acknowledged, MOUNT CARRIGAIN LP, a Texas limited partnership ("ASSIGNOR"),
hereby irrevocably assigns, transfers and sets over to ___________________
("ASSIGNEE") all of Assignor's right, title and interest in and to (i) the lease
agreement (the "LEASE") enumerated on SCHEDULE A attached hereto and made a part
hereof, together rents and additional rents payable thereunder and all tenant
security deposits paid to or deposited with Assignor under the Lease (the
"SECURITY DEPOSITS"), (ii) to the extent assignable, the contracts (the
"CONTRACTS") enumerated in SCHEDULE B attached hereto and made a part hereof,
(iii) to the extent assignable, any governmental permits and approvals (the
"PERMITS AND APPROVALS") related to the improvements (the "IMPROVEMENTS")
located on the land (the "LAND") being conveyed by Assignor to Assignee by Deed,
dated the date hereof, and (iv) to the extent assignable, all contract rights
(including, without limitation, all existing third-party warranties, if any, on
materials and equipment constituting a part of or used in the operation and
maintenance of the Improvements), licenses, permits, plans and specifications,
surveys, soils reports, insurance proceeds by reason of damage to the
Improvements, condemnation awards and all other rights, privileges or
entitlements necessary to continue the use and operation of the Land and the
Improvements.
Assignee hereby accepts the foregoing assignment and assumes all
obligations in connection with the Lease, the Security Deposits, the Contracts
and the Permits and Approvals, arising or first becoming due and payable from
and after the date hereof. Assignee agrees to indemnify Assignor and hold
Assignor harmless from and against any and all claims, liens, damages, demands,
causes of action, liabilities, lawsuits, judgments, losses, costs and expenses
(including but not limited to attorneys' fees and expenses) asserted against or
incurred by Assignor by reason of or arising out of any failure by Assignee to
perform or observe the obligations, covenants, terms and conditions assumed by
Assignee hereunder. Other than with respect to the physical or environmental
condition of the Property (as defined in the Purchase Agreement), Assignor
agrees to indemnify Assignee and hold Assignee harmless from and against any and
all claims, liens, damages, demands, causes of action, liabilities, lawsuits,
judgments, losses, costs and expenses (including but not limited to attorneys'
fees and expenses) asserted against or incurred by Assignee by reason of or
arising out of any failure by Assignor to perform its obligations under the
Lease, the Security Deposits, the Contracts, and the Permits and Approvals to
the extent the same arose prior to the date hereof.
Assignor hereby represents and warrants only that it has not previously
assigned the Lease, the Security Deposit, the Contracts, the Permits and
Approvals, contract rights and other rights assigned hereby. Except as set forth
in that certain Purchase and Sale Agreement dated ________, 2005 between
Assignor and Assignee ("PURCHASE AGREEMENT"), Assignor makes no other
representation or warranty in connection with this Assignment and, except for
the foregoing, this Assignment is made without recourse to Assignor.
All terms of this Agreement shall be binding upon, inure to the benefit
of and be enforceable by the parties hereto and their respective legal
representatives, successors and assigns.
No modification, waiver, amendment, discharge or change of this
Assignment shall be valid unless the same is in writing and signed by the party
against which the enforcement of such modification, waiver, amendment, discharge
or change is or may be sought.
In any action brought to enforce the obligations of Assignor under this
Assignment, the judgment or decree shall be subject to SECTION 16.8 and 16.15 of
the Purchase Agreement.
This Assignment may be executed in any number of counterparts, each of
which so executed shall be deemed original; such counterparts shall together
constitute but one agreement.
IN WITNESS WHEREOF, Assignor and Assignee have each executed this
Assignment of this ____ day of ___________, 2005.
ASSIGNOR:
MOUNT CARRIGAIN LP,
a Texas limited partnership
By: Hampshire Realty Company, LLC,
a Texas limited liability company,
its general partner
By:_____________________________________
Printed Name:___________________________
Title:__________________________________
ASSIGNEE:
________________________________________________
EXHIBIT D
---------
FORM OF XXXX OF SALE
KNOW ALL MEN BY THESE PRESENTS, that MOUNT CARRIGAIN LP, a Texas limited
partnership ("SELLER"), for good and valuable consideration paid by
____________________ ("PURCHASER"), hereby sells to Purchaser, its successors
and assigns, the personal property ("PERSONAL PROPERTY") more particularly
referred to in SCHEDULE A attached hereto free and clear of any and all liens
other than the Permitted Encumbrances (as defined in the Purchase Agreement (as
hereinafter defined)).
Purchaser agrees to pay all sales taxes payable by reason of the
transfer to Purchaser of said Personal Property.
Seller has executed this Xxxx of Sale and BARGAINED, SOLD, TRANSFERRED,
CONVEYED and ASSIGNED the Personal Property and Purchaser has accepted this Xxxx
of Sale and purchased the Personal Property AS IS AND WHEREVER LOCATED, WITH ALL
FAULTS AND WITHOUT ANY REPRESENTATIONS OR WARRANTIES OF WHATSOEVER NATURE,
EXPRESS, IMPLIED, OR STATUTORY, EXCEPT AS EXPRESSLY SET FORTH IN THE PURCHASE
AND SALE AGREEMENT BETWEEN SELLER AND PURCHASER DATED AS OF _____________, 2005
(the "PURCHASE AGREEMENT") AND THE WARRANTIES SET FORTH HEREIN, IT BEING THE
INTENTION OF SELLER AND PURCHASER TO EXPRESSLY NEGATE AND EXCLUDE ALL WARRANTIES
WHATSOEVER OTHER THAN THOSE SET FORTH IN THE PURCHASE AGREEMENT, INCLUDING BUT
NOT LIMITED TO THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR ANY
PARTICULAR PURPOSE, ANY IMPLIED OR EXPRESS WARRANTY OF CONFORMITY TO MODELS OR
SAMPLES OF MATERIALS, ANY RIGHTS OF PURCHASER UNDER APPROPRIATE STATUTES TO
CLAIM DIMINUTION OF CONSIDERATION, ANY CLAIM BY PURCHASER FOR DAMAGES BECAUSE OF
DEFECTS, WHETHER KNOWN OR UNKNOWN WITH RESPECT TO THE PERSONAL PROPERTY,
WARRANTIES CREATED BY AFFIRMATION OF FACT OR PROMISE AND ANY OTHER WARRANTIES
CONTAINED IN OR CREATED BY THE UNIFORM COMMERCIAL CODE AS NOW OR HEREAFTER IN
EFFECT IN THE STATE IN WHICH THE PERSONAL PROPERTY IS LOCATED, OR CONTAINED IN
OR CREATED BY ANY OTHER LAW.
This Xxxx of Sale may be executed in any number of counterparts, each of
which so executed shall be deemed original; such counterparts shall together
constitute but one agreement.
IN WITNESS WHEREOF, Seller and Purchaser have caused these presents to
be signed by their duly authorized officers as of _____________, 2005.
\ SELLER:
MOUNT CARRIGAIN LP,
a Texas limited partnership
By: Hampshire Realty Company, LLC,
a Texas limited liability company,
its general partner
By:_____________________________________
Printed Name:___________________________
Title:__________________________________
PURCHASER:
________________________________________________
EXHIBIT E
---------
LEASE
Lease by and between Seller, as landlord, and Air Systems Components, LP, as
tenant
EXHIBIT F
---------
CONTRACTS
[To be attached by Seller]
EXHIBIT G
---------
FORM OF NOTICE TO TENANT
_______________________, 2005
[Name and Address of Tenant]
Re: _______________________
_______________________
Dear Tenant:
Please be advised that:
1. _____________________ (collectively, "PURCHASER") has/have
purchased the captioned property (the "PROPERTY") from Mount Carrigain LP
("SELLER").
2. In connection with such purchase, Seller has transferred your
security deposit in the amount of $_______________ (the "SECURITY DEPOSIT") to
Purchaser. Purchaser specifically acknowledges the receipt of and sole
responsibility for the return of the Security Deposit.
3. All rental and other payments that become due subsequent to the
date hereof, should be payable to Purchaser at: _______________________________.
SELLER:
MOUNT CARRIGAIN LP,
a Texas limited partnership
By: Hampshire Realty Company, LLC,
a Texas limited liability company,
its general partner
By:_____________________________________
Printed Name:___________________________
Title:__________________________________
PURCHASER:
________________________________________________
EXHIBIT H
---------
FIRPTA AFFIDAVIT
TRANSFEROR'S CERTIFICATION OF NON-FOREIGN STATUS
To inform _____________________________________, a __________________
("TRANSFEREE"), that withholding of tax under Section 1445 of the Internal
Revenue Code of 1986, as amended (the "CODE"), will not be required upon the
transfer of certain real property to Transferee by Mount Carrigain LP, a Texas
limited partnership ("TRANSFEROR"), the undersigned hereby certifies the
following on behalf of Transferor:
1. Transferor is not a foreign corporation, foreign partnership,
foreign trust or foreign estate (as those terms are defined in the Code and the
Income Tax Regulations promulgated thereunder);
2. Transferor's U.S. employer identification number is __________;
and
3. Transferor's office address is 0000 Xxxxxxx Xxxx, Xxxxx 000,
Xxxxxx, Xxxxx 00000, Attention: Xx. Xxxxxxx X. Xxxxxx.
Transferor understands that this Certification may be disclosed to the
Internal Revenue Service by Transferee and that any false statement contained
herein could be punished by fine, imprisonment, or both.
Under penalty of perjury I declare that I have examined this
Certification and to the best of my knowledge and belief it is true, correct and
complete, and I further declare that I have authority to sign this document on
behalf of Transferor.
Dated: ____________, 2005
MOUNT CARRIGAIN LP,
a Texas limited partnership
By: Hampshire Realty Company, LLC,
a Texas limited liability company,
its general partner
By:_____________________________________
Printed Name:___________________________
Title:__________________________________
EXHIBIT I
---------
DISCLOSURE NOTICE
No disclosures
EXHIBIT J
---------
FORM OF TENANT ESTOPPEL CERTIFICATE
[ADDRESS OF BUYER]
[ADDRESS OF LENDER]
RE: [Name and Address of Property]
Gentlemen:
Reference is made to that certain [LEASE AGREEMENT] dated as of
____________ __, ____ between ____________________________, a ____________, as
landlord ("LANDLORD"), and the undersigned, as tenant ("TENANT"), demising
premises at the captioned address more particularly described in the Lease (the
"PREMISES"). The lease, together with all amendments thereto included in
SCHEDULE 1 attached hereto, is herein referred to as the "LEASE". Tenant hereby
represents to the Benefited Parties (as herein defined) that the following
statements are true and correct as of the date hereof:
1. A true, correct and complete copy of the Lease (including all
amendments) is attached hereto as SCHEDULE 1. The undersigned is the Tenant
under the Lease for space at the Premises covering ___________ rentable square
feet.
2. The Lease is in full force and effect and has not been amended,
modified, supplemented or superseded except as indicated in Schedule 1. There
are no understandings, contracts, agreement or commitments of any kind
whatsoever with respect to the Premises, except as expressly provided in the
Lease.
3. The term of the Lease commenced on ________________, and expires
on _________________, subject to any rights of Tenant to extend the term as
provided therein. The base rent presently being charged is $__________. All
rentals, charges, additional rent and other obligations on the part of the
undersigned have been paid to and including ____________, 200_. No rental, other
than for the current month, has been paid in advance. The undersigned has
accepted possession and now occupies the Premises and is currently open for
business. In addition to the fixed minimum Base Rent, the Tenant pays its
pro-rata share of real estate taxes and operating expenses in excess of a base
stop of _________________.
4. Tenant has paid to Landlord a security deposit in the amount of
$____________________. Tenant has no claim against Landlord for any other
security, rental, cleaning, access card, key or other deposits or any prepaid
rentals.
5. Landlord is not in any respect in default in the performance of
the terms and provisions of the Lease, nor does any state of facts or condition
exist which, with the giving of notice or the passage of time, or both, would
result in such a default. All conditions under the Lease to be performed by
Landlord have been satisfied. Without limiting the generality of the foregoing,
all improvements to be constructed in the Premises by Landlord have been
completed to the satisfaction of Tenant and accepted by Tenant and any tenant
construction allowances have been paid in full, and all duties of an inducement
nature required of Landlord in the Lease have been fulfilled to Tenant's
satisfaction. Tenant has no claim against Landlord by reason of any restriction,
encumbrance or defect in title of the Premises of which Tenant has actual
knowledge.
6. There currently is no defense, offset, lien, claim or
counterclaim by or in favor of Tenant against Landlord under the Lease or
against the obligations of Tenant under the Lease (including, without
limitation, any rentals or other charges due or to become due under the Lease)
and Tenant is not contesting any such obligations, rentals or charges. To
Tenant's knowledge, all leasing commissions due in respect of the current term
of the Lease have been paid.
7. Tenant has no renewal, extension or expansion option, no right
of first offer or right of first refusal and no other similar right to renew or
extend the term of the Lease or expand the property demised thereunder except as
may be expressly set forth in the Lease. Tenant has no right to lease or occupy
any parking spaces within the Property except as set forth in the Lease. Tenant
is entitled to no free rent nor any credit, offsets or deductions in rent, nor
other leasing concessions other than those specified in the Lease.
8. Tenant is not in any respect in default in the performance of
the terms and provisions of the Lease nor does any state of facts or condition
exist which, with the giving of notice or the passage of time, or both, would
result in such a default. Without limiting the generality of the foregoing,
Tenant is current in its rental obligation under the Lease.
9. There are no liens recorded against the Premises with respect to
work performed by or at the request of Tenant, or to materials supplied to the
demised property, at the request of Tenant.
10. Tenant has not assigned the Lease nor sublet all or any part of
the Premises, except as shown on Schedule 1 attached hereto and made a part
hereof for all purposes.
The above certifications are made to the Benefited Parties knowing that
the Benefited Parties will rely thereon in making an investment in the Premises.
For purposes hereof, the term "BENEFITED PARTIES" means the addressees of this
letter and all of the following: (a) Harvard Property Trust, LLC, a Delaware
limited liability company and its successors, assigns, and designees (including,
without limitation, any tenant in common purchasers); and (b) any lender to
which any party described in the foregoing clause (a) grants a deed of trust,
mortgage or other lien upon the Premises.
Very truly yours,
____________________________________,
a __________________________________
By:_________________________________
Name:_______________________________
Title:______________________________
EXHIBIT K
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DUE DILIGENCE MATERIALS
ADA Compliance, studies/reports
Aerial Photos
Appraisal, Existing
Building Measurement Surveys by Registered Architect
Building Permits
Building Plans, Specifications,
Paper
Capital Improvements, historical, 3 years
Certificates of Occupancy:
Building
Tenants
Covenants, Conditions & Restriction's (Owner association, condo, etc)
Easement Information
Emergency/Life Safety Systems, Operating Manual
Environmental Site Assessment, Existing
Financial Items:
Aging Reports, Current and past 6 months
Balance Sheet, to date
Budget, Current Year
Excess Operating Expenses Calculations - Current Year
Invoices, as requested, copies only
Operating Expense Reconciliations (3 previous years)
Operating Statements for property, including a general ledger for each
year - 3 yrs
Rent Roll, Current
Security Deposit Listing, Current, LOC's/Guaranty's to be transferred
Floor Plans, as leased
Geotechnical Report, if any
Insurance Certificate, Current, of Seller and Tenants
Insurance Claims, Pending (or confirmation that there are none)
Insurance Claims History
Leases and all amendments
Lease Commission Schedule, 3 previous years
Litigation - Pending (or confirmation of no pending litigation)
Management & Leasing Agreement - Existing
Occupancy/Vacancy History, 3 previous years
O & M Reports (Asbestos, Mold, etc.) (or confirmation that there are none)
Parking Garage Lease/Operating Agreement
Parking Space Configuration (Surface and Garage if applicable)
Permits & Licenses - Alarm
Permits & Licenses - Construction
Permits & License - Elevator
Personal Property Inventory including Office Equipment to remain on site
Photos of the Building
Property Taxes land/improvements current year
Property Tax Statements, Personal, Current & Prior 3 yrs
Roof Reports (or confirmation that there are none)
Security Incident Reports, for prior 24 months
Service Contracts
Site Plans
Standard Form of Lease
Survey, existing
Tenant Contact Information
Tenant Financial Statements, if available
Tenant Improvement projects, currently under construction (copy of contract(s))
Tenant Improvement Schedule, 3 previous years
Title commitment policy of Seller, existing
Title Work - Preliminary
Title Work - Final
Utility Agreements
Utilities, prior 2 years/invoices/summary
Utility Security Deposits
Warranty, Elevator
Warranty, HVAC Equipment
Warranty, Mechanical
Warranty, Roof
Work Order Systems & Operating Manuals
Zoning Report
*Additional material/reports required for the completion of the 3-14 Audit
Detailed accrued expense listing for each quarter ended during the current year
and the prior two years
Detailed rent straight-line schedule for each quarter ended during the current
year and the prior two years
Detailed listing of all tenants with termination options.
Detail of the cash receipts and disbursements journal (downloaded in Excel if
possible) for the full prior year and to date for the current year
Detailed general ledger report of revenues and expenses for each quarter during
the current calendar year and the prior two years
Detailed income statements by month year-to-date and the prior two years
