AGREEMENT
FOR
THE PURCHASE AND SALE
OF
PROPERTY
between
XXXXXX XXXXXX PROPERTIES,
LIMITED PARTNERSHIP
and
ARDEN REALTY LIMITED PARTNERSHIP
September 12, 1997
TABLE OF CONTENTS
PAGE #
ARTICLE ONE -1-
PURCHASE AND SALE OF PROPERTY -1-
1.1 Sale of Property -1-
1.2 Definition of Property -1-
1.3 Exclusions -2-
ARTICLE TWO -2-
PURCHASE PRICE -2-
2.1 Purchase Price -2-
2.2 Xxxxxxx Money Deposit -2-
2.3 Cash Balance Due -3-
2.4 Investment of Deposit -3-
ARTICLE THREE -3-
ESCROW -3-
3.1 Escrow Instructions -3-
3.2 Definition of "Close of Escrow" -3-
3.3 Operation of Property -3-
3.4 Declaration of Special Land
Use Restrictions -4-
3.5 Auditing -4-
ARTICLE FOUR -5-
CONDITION OF TITLE -5-
4.1 Permitted Exceptions -5-
(a) Preliminary Title Report -5-
(b) Other Matters -5-
(c) Survey Matters -5-
(d) Taxes -5-
4.2 Title Insurance Policy -5-
ARTICLE FIVE -6-
CONDITIONS PRECEDENT TO CLOSE OF ESCROW -6-
5.1 HHP's Conditions -6-
(a) Funds -6-
(b) Default -6-
(c) Assumption of Liability -6-
5.2 Buyer's Conditions -6-
(a) Contingency Period -6-
(b) Title Review Period -7-
(c) HHP Default -8-
(d) Assignment Documents -8-
(e) Survey Review Period -9-
(f) Estoppel Certificates -9-
(g) Casualty or Condemnation -10-
(h) Disclosure of Contracts -10-
ARTICLE SIX -11-
CLOSE OF ESCROW -11-
6.1 Date of Close -11-
6.2 Escrow Cancellation -11-
(a) HHP Default -11-
(b) Buyer Default -11-
6.3 Items to be Delivered into Escrow -12-
(a) By HHP -12-
(b) By Buyer -12-
6.4 Escrow Holder's Instructions -12-
(a) Date Documents -12-
(b) Declaration of Value -12-
(c) Record -13-
(d) Deliver Funds -13-
(e) Deliver Title Policy -13-
(f) Information Return -13-
(g) Assignment and Assumption Documents -13-
6.5 Post-Closing Matters -13-
(a) To HHP -13-
(b) To Buyer -13-
ARTICLE SEVEN -14-
COSTS AND PRORATIONS -14-
7.1 Prorations -14-
7.2 Costs to be Paid by HHP -14-
7.3 Costs to be Paid by Buyer -15-
7.4 "Buyer's Closing Expenses" Defined -15-
ARTICLE EIGHT -15-
BUYER'S REPRESENTATIONS AND WAIVERS -15-
8.1 Authority; Qualification -15-
8.2 Condition of Property; Inspection -15-
ARTICLE NINE -17-
HHP'S REPRESENTATIONS -17-
9.1 Authority -17-
9.2 Contracts -17-
9.3 Rent Roll -17-
9.4 Operating Statements -17-
9.5 Material Adverse Information -17-
9.6 Expiration Period of Representations
and Warranties -17-
9.7 HHP's Actual Knowledge -18-
9.8 Waiver -18-
9.9 No Other Representations or Warranties -18-
ARTICLE TEN -18-
ENTRY BY BUYER ONTO THE PROPERTY -18-
ARTICLE ELEVEN -19-
DEFAULT AND REMEDIES -19-
11.1 Buyer's Events of Default -19-
(a) Delivery of Funds -19-
(b) Bankruptcy -19-
(c) Acts or Omissions -19-
(d) Representations and Warranties -19-
11.2 HHP's Events of Default -20-
(b) Bankruptcy -20-
(c) Acts or Omissions -20-
(d) Representations and Warranties -20-
11.3 HHP's Remedies -20-
(a) LIQUIDATED DAMAGES -20-
(b) Post Closing -21-
11.4 Buyer's Remedies -21-
(a) Specific Performance -21-
(b) Terminate -21-
ARTICLE TWELVE -21-
RISK OF LOSS -21-
ARTICLE THIRTEEN -22-
BROKERAGE COMMISSIONS -22-
ARTICLE FOURTEEN -22-
MISCELLANEOUS -22-
14.1 Notices -22-
14.2 Time of the Essence -23-
14.3 Interpretation; Governing Law -23-
14.4 Attorneys' Fees -23-
14.5 Further Assurances; Survival -23-
14.6 Entire Agreement; Amendments -23-
14.7 No Waiver -24-
14.8 No Assignment -24-
14.9 Binding Effect -24-
14.10 Headings; Exhibits; Cross References -24-
14.11 Severability -24-
14.12 Performance of Acts on Business Days -24-
14.13 Backup Withholding -24-
14.14 No Third Party Beneficiaries -25-
14.15 Effective Date -25-
14.16 HHP's 1031 Exchange -25-
14.17 Facsimile Signatures -25-
AGREEMENT FOR PURCHASE AND
SALE OF REAL PROPERTY
THIS AGREEMENT (the "Agreement"), dated for
identification purposes only as of the 12th day of September
1997, is made by and between XXXXXX XXXXXX PROPERTIES, LIMITED
PARTNERSHIP, a Delaware limited partnership ("HHP"), and ARDEN
REALTY LIMITED PARTNERSHIP, a Maryland limited partnership ("Buyer").
A G R E E M E N T :
A. HHP owns that certain seven-story office building
containing approximately one hundred four thousand two hundred
thirty-five (104,235) rentable square feet located at 0000 Xxxxxx
Xxxxx Xxxx, Xxx Xxxxxxx, Xxxxxxxxxx (the "Office Building")
together with a parking garage with approximately two hundred
sixty-five (265) parking spaces.
B. Buyer and HHP heretofore have entered into
negotiations pursuant to which Buyer offered to purchase and
acquire from HHP, and HHP has agreed to sell to Buyer, upon the
terms and subject to the conditions set forth herein, the
Property (as hereinafter defined).
NOW, THEREFORE, in consideration of the mutual
covenants and agreements set forth herein and other valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, HHP and Buyer agree as follows:
ARTICLE ONE
PURCHASE AND SALE OF PROPERTY
1.1 Sale of Property. Upon the terms and subject to the
conditions hereinafter set forth, HHP shall sell, assign, convey
and transfer to Buyer, and Buyer shall purchase and acquire from
HHP, all right, title and interest of HHP in and to the Property
(as defined in Section 1.2 hereof).
1.2 Definition of Property. As used in this Agreement, the
term "Property" shall include all of the real personal and
intangible property described in subsections (a)
through (f) hereof:
(a) The land on which the Office Building is located,
and all appurtenant rights thereto, which land (the "Office
Land"), is more particularly described on Exhibit "A" hereto;
(b) All buildings, structures, parking areas and other
improvements located on the Office Land (the "Office Improvements");
(c) All personal property owned by HHP located at and
used in connection with the operation and management of the
Office Building which is listed on Exhibit "B" attached hereto
and incorporated herein by reference ("Personal Property");
(d) All leases to tenants leasing space in the Office
Building (the "Tenant Leases") identified on Exhibit "C" attached
hereto and incorporated herein by reference which shall be
assigned from HHP to Buyer at the Close of Escrow;
(e) To the extent assignable, those certain Service
Contracts (as defined in Section 5.2(h)) that are approved by
Buyer pursuant to Section 5.2(h) which shall be assigned from HHP
to Buyer at the Close of Escrow; and
(f) All other right, title and interest of Seller
constituting part and parcel of the Property, including,
easements, licenses, permits, air rights, certificates of
occupancy, warranties, rights-of-way, signs, telephone listings
and numbers, the use of the name "Northpoint Building," as well
as the use of any tradename, logo or trademark that is associated
with the name "Northpoint Building," sewer agreements, water line
agreements, utility agreements, water rights and oil, gas and
mineral rights (collectively, the "Intangibles") to the extent
assignable or transferable.
1.3 Exclusions. Notwithstanding any provision of Section
1.2 hereof to the contrary, the Property shall not include:
(a) Any non-transferable licenses; and
(b) Any personal property located on the Office Land
and owned by any entity other than HHP.
ARTICLE TWO
PURCHASE PRICE
2.1 Purchase Price. The purchase price ("Purchase Price")
for the Property shall be Twenty-One Million Eight Hundred
Thousand and 00/100 Dollars ($21,800,000.00).
2.2 Xxxxxxx Money Deposit. On the Effective Date of this
Agreement, Buyer shall deposit the sum of Three Hundred Fifty
Thousand and 00/100 Dollars ($350,000.00) as an xxxxxxx money
deposit (the "Deposit") with Escrow Holder (as hereinafter
defined), which Deposit shall be applied toward the Purchase
Price at Close of Escrow, except as otherwise provided herein.
The Deposit shall be in the form of a cashier's check made
payable to Escrow Holder.
2.3 Cash Balance Due. Upon Close of Escrow (as defined in
this Agreement below), Buyer shall pay into Escrow in cash an
amount (the "Cash Balance Due") equal to (i) the Purchase Price
less the Deposit (together with all interest earned thereon) plus
(ii) Buyer's Closing Expenses as defined in Section 7.4 plus or
minus (iii) the Buyer's prorations pursuant to Section 7.1.
2.4 Investment of Deposit. Buyer shall have the right to
instruct Escrow Holder to invest the Deposit in the following
investments ("Approved Investments"): (i) United States Treasury
obligations, (ii) United States Treasury-backed repurchase
agreements issued by a major money center banking institution
reasonably acceptable to Seller, (iii) Certificates of Deposit or
Money Market Accounts of institutions whose deposits are insured
by the FDIC or (iv) such other manner as may be reasonably agreed
to by Seller and Purchaser. The Deposit shall be disposed of by
Escrow Agent only as provided in this Agreement. In the absence
of such written instructions, Escrow Holder shall invest the
Deposit in one or more interest bearing trust accounts with
local, federally insured banking institutions; provided, Buyer
executes and delivers to Escrow Holder an Internal Revenue
Service Form W-9.
ARTICLE THREE
ESCROW
3.1 Escrow Instructions. The purchase and sale of the
Property shall be consummated through an escrow (the "Escrow") to
be established at Xxxxxxx Title of California ("Escrow Holder").
The Escrow shall be opened within three (3) business days
following the Effective Date (as hereinafter defined) by delivery
to Escrow Holder of a fully executed copy of this Agreement which
shall constitute Escrow Holder's instructions. HHP and Buyer
agree to execute and deliver to Escrow Holder such additional and
supplemental instructions as Escrow Holder may require in order
to clarify Escrow Holder's duties under this Agreement; provided,
however, that in the event of any conflict or inconsistency
between this Agreement and any instructions delivered to Escrow
Holder the terms of this Agreement shall govern the duties of
Escrow Holder and the rights and obligations of HHP and Buyer.
3.2 Definition of "Close of Escrow". For purposes of this
Agreement, the term "Close of Escrow" shall mean the time when
Escrow Holder shall have recorded all of the instruments to be
recorded as set forth in Section 6.4 below.
3.3 Operation of Property. Except as may be first approved
by Buyer (whose approval shall not be unreasonably withheld or
delayed), or as may be otherwise contemplated by this Agreement,
Seller shall not following the Effective Date: (i) amend,
supplement or otherwise change in any material respect the terms
and conditions of the Service Contracts and Tenant Leases; (ii)
enter into any contract or commitment, or incur any liability,
with respect to the Property (except contracts and commitments
entered into, and current liabilities incurred, in the ordinary
course of business with third parties); or (iii) cause a monetary
encumbrance to be recorded upon the Property. Notwithstanding
anything to the contrary in the preceding sentence, Buyer agrees
to reimburse HHP, at the Close of Escrow, for eighty percent
(80%) of those tenant improvement costs, and commissions,
incurred by HHP under that Lease, dated July, 1993, between
Xxxxxxxx Xxxx and HHP which was assigned to Right Management
Consultants in March of 1995 and amended by that First Amendment,
dated July 7, 1997. Additionally, if HHP enters into any leases
for space in the Office Building after the Effective Date but
prior to the Close of Escrow, which leases are approved by Buyer,
which approval shall not be unreasonably withheld or delayed, and
incurs any costs to construct tenant improvements in the Office
Building or pay commissions to brokers or others in connection
with such leases, Buyer, if Buyer purchases the Property, agrees
to reimburse, at the Close of Escrow, HHP for all costs
("Improvement/Commission Costs") incurred, as of the Close of
Escrow, by HHP relating to the construction of the tenant
improvements and payment of commissions. To the extent the
construction of the tenant improvements are not complete by the
Close of Escrow or the payment of the commissions are not yet
due, Buyer agrees to assume all obligations for the payment of
those tenant improvements to be constructed after the Close of
Escrow and any commissions due after the Close of Escrow.
3.4 Declaration of Special Land Use Restrictions. As a
material inducement to HHP to sell the Property to Buyer, Buyer
has agreed, at the Close of Escrow, to execute and cause to be
recorded upon the Office Land that certain Special Land Use
Restrictions attached hereto as Exhibit "D" ("Special Land Use
Restrictions") which, among other things, require that the
existing Office Building upon the Office Land shall not be
expanded to increase the square footage of the Office Building
and restrict any future new construction of any additional
buildings upon the Office Land without HHP"s prior approval.
3.5 Auditing. At Buyer's request at any time from and
after the date hereof until the date that is one (1) year after
the Close of Escrow, HHP shall, at Buyer"s expense, provide to
Buyer's designated independent auditor reasonable access to the
books and records of the Property, regarding the period for which
Buyer is required to have audited financial statements prepared
with respect to the Property as may be required by the Securities
and Exchange Commission, but only to the extent that such books,
records and related information are in HHP's possession or
control and relate to the period during which HHP held title to
the Property. Further, HHP agrees to provide such auditor a
representation letter regarding the books and records of the
Property, in substantially the form of Exhibit "J" attached
hereto, in connection with the normal course of auditing the
Property in accordance with generally accepted auditing standards
(but shall not thereby be deemed to have made any representation
or warranty to Buyer or to any other third party).
ARTICLE FOUR
CONDITION OF TITLE
4.1 Permitted Exceptions. HHP shall convey to Buyer fee
simple title to the Office Land subject only to the following
exceptions (the "Permitted Exceptions"):
(a) Preliminary Title Report. The exceptions which
are disclosed by the Report described
(b) Other Matters. All other covenants,
conditions, restrictions, reservations, rights,
rights-of-way, easements, dedications, offers of
dedication and other matters of record.
(c) Survey Matters. All matters which are
disclosed by the ALTA Survey of the Property.
(d) Taxes. A lien to secure payment of
general and special real property taxes and
assessments not delinquent, and any supplemental tax
liens imposed as a result of this transaction.
(e) Parking Garage. The rights of the
owner of the building commonly known as 0000 Xxxxxx
Xxxxx Xxxx ("0000 Building") to use the parking
garage of the Office Building as more fully set forth
in Section 3.2 of that certain Construction,
Operations and Reciprocal Easement Agreement For
Parking Structure and Entertainment Complex, dated
April 29, 1997, between HHP and The Prudential
Insurance Company of America, which is reflected in
the Report.
4.2 Title Insurance Policy. At Close of Escrow and
as a
condition thereto, Escrow Holder shall issue to Buyer
an ALTA Owner's Policy of title insurance (the "Title
Policy") of Xxxxxxx Title Guaranty Company (the
"Title Company") as to the Property, with a limit of
liability in the amount of the Purchase Price subject
only to the Permitted Exceptions. HHP shall be
responsible for making the necessary arrangements to
prepare an ALTA Survey ("ALTA Survey") for the
issuance of the Title Policy. HHP shall be
responsible for the payment of all the costs relating
to the ALTA Survey.
ARTICLE FIVE
CONDITIONS PRECEDENT TO CLOSE OF ESCROW
5.1 HHP's Conditions. Each of the following
shall constitute a condition precedent to the
obligations of HHP to close the Escrow and may be
waived only by a written wavier executed by HHP and
delivered to Escrow Holder:
(a) Funds. Buyer shall have deposited
with Escrow Holder immediately available funds in the
amount of the Cash Balance Due described in Section
2.3 above at least one (1) business day prior to the
date set for Close of Escrow.
(b) Default. Buyer shall not have
committed a Buyer Event of Default (as defined
below).
(c) Assumption of Liability. Buyer shall have
deposited with Escrow Holder the assignment and
assumption documents ("Assignment and Assumption
Documents") attached hereto as Exhibit "I," which is
incorporated herein by reference, duly executed by
Buyer in counterpart.
5.2 Buyer's Conditions. Each of the following
shall constitute a condition precedent to the
obligations of Buyer to close the Escrow and may be
waived only by a written waiver executed by Buyer and
delivered to Escrow Holder:
(a) Contingency Period. Buyer shall have
the right, at any time up to and including 5:00 P.M.
Pacific Daylight Savings Time on the thirtieth (30th)
day after the Effective Date (the "Contingency
Date"), to satisfy itself as to the Property and its
condition, suitability, and feasibility for Buyer's
intended use thereof, including, without limitation,
the future marketability of the Office Improvements
to potential tenants, the condition of the Property,
the zoning for the Property and the availability of
all permits, licenses, variances and the like
necessary for Buyer's intended use of the Property.
Upon Buyer"s request, HHP shall provide Buyer with
access to all documents and materials relative to the
Property which are in the possession and control of
HHP including, without limitation, copies of the
Service Contracts and Tenant Leases and Buyer shall
have the right to conduct market feasibility or other
studies Buyer deems appropriate concerning the
Property. During the Contingency Period, Buyer may
terminate this Agreement for any reason in Buyer's
sold and governed by the laws of the State of
California.
14.4 Attorneys' Fees. In the event of any litigation
between the parties regarding this Agreement or the Property, the
prevailing party shall be entitled to the payment by the losing
party of its reasonable attorneys' fees, court costs and
litigation expenses, as determined by the court.
14.5 Further Assurances; Survival. Each party will,
whenever and as often as it shall be requested to do so by the
other party, execute, acknowledge and deliver, or cause to be
executed, acknowledged and delivered, any and all such further
conveyances, assignments, approvals, consents and any and all
other documents and do any and all other acts as may be necessary
to carry out the intent and purpose of this Agreement. All
covenants and obligations contained in this Agreement which imply
or require performance after Close of Escrow and all
representations and warranties of the parties contained in this
Agreement shall survive the Close of Escrow.
14.6 Entire Agreement; Amendments. This Agreement, together
with the other written agreements referred to herein, is intended
by the parties to be the final expression of their agreement with
respect to the subject matter hereof, and is intended as the
complete and exclusive statement of the terms of the agreement
between the parties. As such, this Agreement supersedes any and
all prior understandings between the parties, whether oral or
written. Any amendments to this Agreement shall be in writing and
shall be signed by both parties hereto. This Agreement may be
executed in counterparts, and when taken together, shall
constitute a binding agreement.
14.7 No Waiver. A waiver by either party hereto of a breach
of any of the covenants or agreements hereof to be performed by
the other party shall not be construed as a waiver of any
succeeding breach of the same or other covenants, agreements,
restrictions or conditions hereof.
14.8 No Assignment. Neither Buyer nor HHP shall assign any
of its rights or delegate any of its obligations hereunder without
the prior written consent of the other party hereto, which may be
withheld in such party's sole and absolute discretion.
14.9 Binding Effect. This Agreement shall be binding upon
and inure to the benefit of the parties hereto and their
respective heirs, representatives, successors and permitted
assigns.
14.10 Headings; Exhibits; Cross References. The headings and
captions used in this Agreement are for convenience and ease of
reference only and shall not be used to construe, interpret,
expand or limit the terms of this Agreement. All exhibits attached
to this Agreement and the Recitals at the front of this Agreement
are incorporated herein by the references thereto contained
herein. All references in this Agreement to Articles, Sections and
Exhibits shall be to Articles, Sections and Exhibits of or to this
Agreement, unless otherwise specified.
14.11 Severability. In the event that any phrase, clause,
sentence, paragraph, section, article or other portion of this
Agreement shall become illegal, null or void, or against public
policy, for any reason, or shall be held by any court of competent
jurisdiction to be illegal, null or void, or against public
policy, the remaining portions of this Agreement shall not be
affected thereby and shall remain in force and effect to the full
extent permitted by law.
14.12 Performance of Acts on Business Days. Unless
specifically stated to the contrary, all references to days herein
shall be deemed to refer to calendar days. In the event that the
final date for payment of any amount or performance of any act
hereunder falls on a Saturday, Sunday or holiday, such payment may
be made or act performed on the next succeeding business day.
14.13 Backup Withholding. If any regulations proposed or
promulgated by the Internal Revenue Service subject the
transactions contemplated hereunder to backup withholding (which
would require Buyer to withhold a portion of the Purchase Price
from HHP), then HHP may, at its option, provide Buyer and/or
Escrow Holder with the necessary declaration in order to exempt
such transactions from backup withholding.
14.14 No Third Party Beneficiaries. This Agreement is
intended for the exclusive benefit of HHP and Buyer and their
respective permitted assigns and is not intended and shall not be
construed as conferring any benefit on any third party or the
general public.
14.15 Effective Date. "Effective Date" shall mean the date on
which this Agreement is executed by the last of the parties to
execute this Agreement as set forth opposite their respective
signatures below and an original of the Agreement delivered to
Escrow Holder.
14.16 HHP's 1031 Exchange. HHP may, at its option exercisable
within its discretion, arrange for tax-deferred exchanges of the
Property within the meaning of Section 1031 of the Internal
Revenue Code, and Buyer agrees in such event to cooperate with HHP
in order to effectuate such an exchange or exchanges concurrently
with Buyer's acquisition of the Property, or any portion thereof.
Buyer also agrees to cooperate with HHP in effecting a delayed or
non-simultaneous tax-deferred exchange. In this connection, Buyer
hereby agrees to permit HHP to assign its rights, duties and
obligations to sell the Property to a qualified intermediary
("Accommodator") in order to facilitate HHP's transfer of the
Property in a manner that may qualify as a non-simultaneous tax-
deferred exchange under Section 1031 of the Internal Revenue Code.
Notwithstanding the foregoing, the Property may be conveyed
directly from HHP to Buyer by deed as authorized by Section 1031
of the Internal Revenue Code. The foregoing assignment by HHP to
Accommodator shall not limit, modify, alter or impair in any way
the obligations of HHP under this Agreement, except that the
Accommodator shall have the right to receive Buyer's payment of
the Purchase Price for the Property. HHP shall not be released
from any covenant, duty or obligation agreed to by HHP under this
Agreement as a result of
the assignment to Accommodator of HHP's rights, duties and
obligations to sell the Property. HHP will be solely responsible
for all additional escrow fees, title insurance fees, and
documentary transfer taxes in order to facilitate the transaction
contemplated under this Section 14.16.
14.17 Facsimile Signatures. Buyer and HHP each (i) has
agreed to permit the use, from time to time and where appropriate,
of telecopied signatures in order to expedite the transaction
contemplated by this Agreement, (ii) intends to be bound by its
respective telecopied signature, (iii) is aware that the other
party will rely on the telecopied signature, and (iv) acknowledges
such reliance and waives any defenses to the enforcement of the
documents and notices effecting the transaction contemplated by
this Agreement based on the fact that a signature or notice was
sent by telecopy.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement on the date set forth beneath their respective
signatures below.
HHP: BUYER:
XXXXXX XXXXXX PROPERTIES, ARDEN REALTY LIMITED PARTNERSHIP,
LIMITED PARTNERSHIP, a a Maryland limited partnership
Delaware limited partnership
By its general partner:
By its sole general partner: ARDEN REALTY, INC., a
THE XXXXXX XXXXXX CORPORATION, Maryland corporation
a Delaware corporation
By:/s/ Xxxxxx X. Xxxxxxx By:/s/
Xxxxxxx X. Xxxxxxxx
Print Name: Xxxxxx X. Xxxxxxx
Print Name: Xxxxxxx X. Xxxxxxxx
Print Title: President and COO
Print Title: General Counsel and
Senior Vice President
Executed at _______________, Executed at _______________,
___________, this ______ day of ___________, this _______
day of
_______________, 19___. ________________, 19___.
XXXXXXX TITLE OF CALIFORNIA hereby acknowledges receipt of
the foregoing escrow instructions and agrees to act as Escrow
Holder in accordance with the terms and conditions thereof.
XXXXXXX TITLE OF CALIFORNIA
By:___________________________
Title:________________________
Date:_________________________
