SALE AGREEMENT
(Desert Samaritan Medical Buildings I and II)
This AGREEMENT is entered into effective the 1st day of
September, 1995, by and between DESERT COMMERCIAL PROPERTIES LIMITED
PARTNERSHIP, an Arizona limited partnership ("Seller") and UNIVERSAL HEALTH
REALTY INCOME TRUST, a Maryland real estate investment trust ("Buyer"):
RECITALS
A. Seller: (1) holds the tenant's/lessee's interest (the
"Ground Lease Interest") under those ground leases described on Exhibit "B"
attached hereto (the "Ground Leases"), applicable to that real property
described on Exhibit "A" attached hereto (the "Real Property"); (2) owns,
subject to the terms of the Ground Leases, certain of the fixtures and
improvements located on the Real Property (the "Improvements"); (3) holds the
landlord's/lessor's interest (the "Tenant Lease Interests") under all tenant
leases ("Tenants") for sublease of the Real Property and Improvements ("Tenant
Leases"), together with the security deposits paid by such Tenants pursuant to
those Tenant Leases (the "Security Deposits"); (4) holds an interest under
certain service and other contracts applicable to the Real Property and
Improvements (the "Contract Interests"); and (5) owns or holds an interest in
certain personal property ("Personal Property") and intangible property and
other rights appurtenant to the Real Property and Improvements (the "Intangible
Property"), with the Ground Lease Interest, Improvements, Tenant Lease
Interests, Deposits, Contract Interests, Personal Property and Intangible
Property sometimes referred to herein as the "Property".
B. That portion of the Property commonly known as Desert
Samaritan Medical Building I, located at 0000 Xxxxx Xxxxxx Xxxx, Xxxx, Xxxxxxx,
is sometimes referred to herein as "Building I", and that portion of the
Property commonly known as Desert Samaritan Medical Building II, located at 0000
Xxxxx Xxxxxx Xxxx, Xxxx, Xxxxxxx, is sometimes referred to herein as "Building
II".
C. Certain of the Property is encumbered by that $11,500,000.00
original principal amount loan (the "Loan") made by United States Leasing
International, Inc. ("Lender") to Seller, evidenced by Promissory Note dated
September 15, 1993, secured by, among other things, Deed of Trust, Security
Agreement, Assignment of Leases and Rents, Fixture Filing and Financing
Statement dated September 15, 1993, and recorded September 16, 1993 as
Instrument No. 93-0626122, Office of the Maricopa County Recorder, Arizona and
related documents (the "Loan Documents").
D. Seller desires to sell and transfer to Buyer, and Buyer
desires to purchase and accept transfer from Seller, of an undivided 10.720%
ownership in the Property, exclusive of the encumbrance of or any liability for
the Loan (the "Subject Interest"), on the terms and conditions set forth herein
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TERMS AND CONDITIONS
NOW, THEREFORE, for and in consideration of the mutual
covenants and provisions set forth herein, and other good and valuable
consideration, the receipt of which by all parties is hereby acknowledged, the
parties, intending to be legally bound, agree as follows:
1. Sale. Seller agrees to sell to Buyer, and Buyer agrees to
purchase from Seller, the Subject Interest on the terms and conditions set forth
in this Agreement.
2. Purchase price. The purchase price payable by Buyer to
Seller for the Subject Interest is One Million, Seven Hundred Forty-One
Thousand, Four Hundred Thirty-One and No/100 Dollars ($1,741,431.00) (the
"Purchase Price"), payable in cash at Closing (as herein defined). The Purchase
Price shall be allocated to the Property as set forth on Exhibit "C" attached
hereto.
3. Closing. Closing pursuant to this Agreement, shall take
place effective as of ___________________, 1995 (the "Closing"). At Closing,
Seller and Buyer shall:
A. Take all acts, and execute all documents,
necessary to transfer the Subject Interest from Seller to
Buyer, including:
(1) Assignment of Leasehold Interest, in
the form of Exhibit "D" attached
hereto, conveying the Ground Lease
Interest portion of the Subject
Interest;
(2) Special Warranty Deed in the form of
Exhibit "E" attached hereto,
conveying the Subject Interest
portion of the Improvements.
(3) Affidavit of Property Value, as
required by Arizona law.
(4) Non-Foreign Affidavit (in compliance
with Section 1445 of the Internal
Revenue Code) in the form of Exhibit
"F" attached hereto.
(5) Rent Roll, in the form of Exhibit
"G" attached hereto, completed to
reflect current status of all Tenant
Leases and Deposits.
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(6) Assignment and Assumption of Leases
and Contracts, in the form of
Exhibit "H" attached hereto, as to
the Subject Interest portion of all
Tenant Lease Interests, Deposits and
Contract Interests.
(7) Xxxx of Sale in the form of Exhibit
"I" attached hereto, as to the
Subject Interest portion of all
Personal Property.
(8) Assignment of Rights in the form of
Exhibit "J" attached hereto as to
the Subject Interest portion of all
Intangible Property.
B. Prorations. All income and expense items
(excluding the Loan and principal and interest payments
thereon, but including any real estate tax, insurance and
similar impound payments or accounts) applicable to the
Subject Interest shall be prorated between Seller and Buyer as
of the Closing (based on the latest available information, to
be updated and reprorated when actual information becomes
known), such that Seller is entitled to all income and bears
all expenses for the period up to Closing, and Buyer is
entitled to all income and bears all expenses for the period
from and after Closing; provided that no prorations shall be
made for the Loan. Specific proration items include:
(1) Real estate taxes, prorated based on
1994 figures if 1995 figures are not
known as of Closing, to be
reprorated when 1995 figures become
known.
(2) The Subject Interest portion of all
Deposits, to be transferred to or
for the account of Buyer.
(3) All rents and other Tenant payments
(including expense overage and
impounds) prorated based on
scheduled payments required under
Tenant Leases.
C. Loan Liability. The Subject Interest shall not
include, and neither the provisions of this Agreement nor any
document executed in connection therewith shall in any way
obligate or be interpreted so as to have Buyer assume or in
any way be responsible for, any liability under the Loan. As a
material consideration for Buyer's purchase of the Subject
Interest, Seller agrees, from and after Closing, to in all
respects be liable for and timely pay each and all of the
payments required under the Loan and Loan Documents (the "Loan
Payment Obligation"), excepting only impound or similar
payments for real estate taxes, insurance and other payments
or performances related to ownership and operation of the
Property and not to the Loan or any payments required in
connection therewith (including but not limited to principal,
interest, late charges, default interest, prepayment
penalties, costs, attorneys' fees, advancement cost and
similar matters).
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D. Non-Consent. Buyer acknowledges review of
provisions of the Loan Documents, including but not limited to
the restrictions on transfer and further encumbrance without
the Lender's approval (the "Transfer Restrictions"). Seller
and Buyer acknowledge and agree the Subject Interest shall be
transferred from Seller to Buyer at Closing without compliance
with the Transfer Restrictions, with each of Seller and Buyer
hereby releasing the other from any and all claims or
liability deriving from any non-compliance by Seller or Buyer
with the Transfer Restrictions to the extent applicable to
transfer of the Subject Interest pursuant to this Agreement,
but without releasing Seller from the Loan Payment Obligation.
E. Authorization. Seller and Buyer shall each provide
to the other appropriate evidence of their authority to
execute this Agreement and all documents referenced herein
("Related Documents"), and to perform each and all of their
obligations thereunder.
F. Survival. The provisions of this paragraph 3 shall
survive the Closing.
G. Feasibility. Prior to or concurrently with the
full execution of this Agreement, Seller has delivered or
caused to be delivered to Buyer the following:
(1) A title commitment in favor of Buyer
in the amount of the Purchase Price
issued by a title insurance company
mutually acceptable to Buyer and
Seller that commits to issue Buyer a
standard owners' policy of title
insurance at the Closing insuring
that Buyer is the owner of the
Subject Interest and that lists all
exceptions to title to the Subject
Interest;
(2) Legible copies of all documents
evidencing the exceptions to title
to the Subject Interest which are
set forth in the aforementioned
title commitment;
(3) Any environmental reports or
assessments affecting the Property;
(4) The rent roll, as of the date of
this Agreement and any other
information pertaining to the
tenancies and operations of the
Property that is in Seller's
possession and which Buyer requests
in writing.
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Buyer shall have the right to terminate this Agreement if, in
its sole discretion, it does not approve of the matters set
forth above by sending written notice of such termination
prior to the expiration of the fifth day after its receipt of
all such matters. In the event of such a termination, Buyer
and Seller shall have no further obligations to each other
under this Agreement.
H. Title Policy. At the Closing, Seller shall cause
to be issued to Buyer a standard owners' title insurance
policy in the amount of the Purchase Price insuring that Buyer
is the owner of the Subject Interest subject only to those
matters set forth in the commitment for title insurance
referenced in Section 3.G above. This title insurance policy
shall include an endorsement allowing the benefits of the
coverage to be transferred at no additional cost to any
limited liability company formed by Buyer and Seller and to
which the Property is conveyed.
4. Representations. Seller and Buyer each represent and
warrant to the other that:
A. They are duly organized pursuant to their
organizational documents, with full power and authority to
enter into and perform each and all of their obligations under
this Agreement and Documents.
B. Execution of this Agreement, and Related
Documents, and performance of each and all of their
obligations thereunder, does not breach or contravene any
agreement, law or other arrangement by which they are bound.
C. Seller has disclosed to Buyer, and Buyer has
reviewed or had the opportunity to review, all pertinent
materials and information pertaining to the Property,
including but not limited to physical condition, zoning,
title, tenancies, environmental compliances, and related
matters.
5. Commissions. Seller and Buyer each represent to the other
that no broker has been involved with the transaction evidenced by this
Agreement, other than CB Commercial Real Estate, and each agrees to indemnify
and hold the other harmless from for and against any commission or other fee
claimed by a third party as a result of its acts or failure to act. Seller shall
be solely responsible for any commission due CB Commercial.
6. Attorneys' Fees. In the event of any litigation between the
parties hereto arising out of this Agreement, all reasonable attorneys' fees,
costs and related expenses shall be awarded to the prevailing party therein, and
such attorneys' fees, costs and expenses shall be included in any judgment
obtained by the prevailing party.
7. Invalidity. Wherever possible, each provision of this
Agreement shall be interpreted in such manner as to be valid under applicable
law, but if any provision of this Agreement shall be invalid or prohibited
hereunder, such provision shall be ineffective to the extent of such prohibition
or invalidation but shall not invalidate the remainder of such provision or the
remaining provisions of this Agreement.
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8. Successors. This Agreement shall be binding upon and inure
to the benefit of the successors in interest and assigns of the parties hereto,
provided, however, that: (a) Buyer shall not in any way transfer any of its
interest under this Agreement without the prior written consent of Seller; and
(b) Seller shall not in any way transfer any of its interest under this
Agreement without the prior written consent of Buyer.
9. Entire Agreement. This Agreement contains the entire
agreement of the parties hereto with respect to the matters set forth herein,
and supersedes all prior arrangements and understandings between the parties,
and no other agreement, statement or promise made by either party hereto which
is not contained herein shall be binding or valid.
10. Controlling Law. This Agreement shall be construed and
interpreted under, and governed and enforced according to the laws of the State
of Arizona.
11. Notices. Any and all notices or demands by or from the
parties hereto shall be in writing and deemed given upon personal receipt, or if
served by certified mail, seventy-two (72) hours after deposit in the United
States mail, postage prepaid, to the address set forth below, or any other
addresses duly noticed in accordance with this paragraph.
12. Tax Deferred Exchange. Buyer ("Accommodator") shall
cooperate with Seller ("Requesting Party") in effectuating disposition of the
Property pursuant to a tax deferred exchange under Section 1031 of the Internal
Revenue Code of 1986, as and if amended (an "Exchange"), subject to the
following limitations:
A. The Requesting Party shall have the right to
proceed with an Exchange at any time prior to the Closing
Date, provided it gives reasonable advance notice of its
desire to have Accommodator participate in the Exchange,
together with each and all of the documents to be executed by
Accommodator with respect to the Exchange.
B. Neither the Closing, nor consummation of any other
aspect of this Agreement, shall in any way be predicated or
conditioned on the Exchange or completion thereof.
C. Any documents to be executed by Accommodator in
connection with an Exchange shall not cause Accommodator to
incur any additional cost, expense or liability.
D. Accommodator shall have the right, as a condition
to participation in the Exchange, to require Requesting Party
to provide advance payment to Accommodator of the reasonably
anticipated extra costs, including attorneys' fees, to be
incurred by Accommodator solely by reason of participation in
the Exchange.
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E. Accommodator does not make any representation or
warranty to Requesting Party or any other third party,
including state or federal tax authorities, that the Exchange
will qualify for any particular or deferred tax treatment.
F. Requesting Party shall indemnify and hold
Accommodator harmless for, from and against any and all
liability, damages, or costs, including actual attorneys'
fees, incurred or that may be incurred by Accommodator by
virtue of Accommodator's participation in the Exchange.
G. The Exchange shall not in any way limit, terminate
or otherwise affect all or any of any party's rights or
obligations, under this Agreement.
13. Exhibits. Exhibits "A" through "J" attached are by this
reference incorporated herein.
IN WITNESS WHEREOF, this Agreement has been executed on the day
and year first set forth above.
SELLER
DESERT COMMERCIAL PROPERTIES LIMITED
PARTNERSHIP, an Arizona limited partnership
By: ROKMAR CAPITAL, L.L.C., an Arizona limited
liability company, its Managing General Partner
By: /s/ XXXXXXXXXXX
------------------------------------
Its: Manager
------------------------------------
Tax I.D. No. 00-0000000
Address: 0000 Xxxx Xxxxxxxxx Xxxx,
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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BUYER
UNIVERSAL HEALTH REALTY INCOME TRUST, a
Maryland real estate investment trust
By: /s/ XXXXXXXX
------------------------------------
Its: Vice President
------------------------------------
Tax I.D. No. 00-0000000
Address: 000 Xxxxx Xxxxx Xxxx
Xxxx xx Xxxxxxx, Xxxxxxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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LIST OF EXHIBITS
Exhibits Description
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"A" Legal Description of Real Property
"B" Ground Leases
"C" Purchase Price Allocation
"D" Assignment of Leasehold Interest
"E" Special Warranty Deed
"F" Rent Roll
"G" Non-Foreign Affidavit
"H" Assignment and Assumption of Leases and Contracts
"I" Xxxx of Sale
"J" Assignment of Rights
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