1
Exhibit 10.35
GROUND LEASEHOLD ESTATES
XXX XXXX XXXXX, XXX XXXX, XXX XXXX
SALE AGREEMENT
BETWEEN
MID-CITY ASSOCIATES,
a New York partnership,
AS SELLER,
AND
ONE PENN PLAZA LLC,
a New York limited liability company,
AS PURCHASER
Purchaser Execution Date: November ___, 1997
Effective Date: ____________________
2
TABLE OF CONTENTS
Page #
ARTICLE I
Section 1.1 Agreement of Purchase and Sale............................ 1
Section 1.2 Property Defined.......................................... 3
Section 1.3 Purchase Price............................................ 3
Section 1.4 Payment of Purchase Price................................. 3
Section 1.5 Deposit................................................... 3
ARTICLE II
Section 2.1 Existing Title And Survey Matters......................... 3
Section 2.3 Permitted Exceptions...................................... 5
Section 2.4 Conveyance of Title to the Ground Leasehold Estate........ 6
ARTICLE III
Section 3.1 "As Is" Condition......................................... 7
Section 3.2 Environmental Reports..................................... 7
Section 3.3 Review of Tenant Estoppels................................ 7
Section 3.4 Korein Ground Landlord Estoppel........................... 8
Section 3.5 LIRR Ground Landlord Estoppel............................. 9
ARTICLE IV
Section 4.1 Time and Place............................................ 9
Section 4.2 Seller's Obligations at Closing........................... 9
Section 4.3 Purchaser's Obligations at Closing........................ 13
Section 4.4 Credits and Prorations.................................... 14
Section 4.5 Transaction Taxes and Closing Costs....................... 19
Section 4.6 Conditions Precedent to Obligation of Purchaser........... 19
Section 4.7 Conditions Precedent to Obligation of Seller.............. 20
ARTICLE V
Section 5.1 Representations and Warranties of Seller.................. 21
Section 5.2 Knowledge Defined......................................... 23
3
Section 5.3 Survival of Seller's Representations and Warranties....... 24
Section 5.4 Covenants of Seller...................................... 24
Section 5.5 Representations and Warranties of Purchaser............... 25
Section 5.6 Survival of Purchaser's Representations and Warranties.... 26
ARTICLE VI
Section 6.1 Default by Purchaser...................................... 27
Section 6.2 Default by Seller......................................... 27
Section 6.3 Recoverable Damages....................................... 27
ARTICLE VII
Section 7.1 Minor Damage.............................................. 28
Section 7.2 Major Damage.............................................. 28
Section 7.3 Definition of "Major" Loss or Damage...................... 29
Section 7.4 Section 5-1311 of the New York General Obligation Law..... 30
ARTICLE VIII
Section 8.1 Brokerage Commissions..................................... 30
ARTICLE IX
Section 9.1 No Reliance on Documents.................................. 30
SECTION 9.2 AS-IS SALE; DISCLAIMERS................................... 31
Section 9.3 Survival of Disclaimers................................... 32
ARTICLE X
Section 10.1 Confidentiality.......................................... 32
Section 10.2 Public Disclosure........................................ 33
Section 10.3 Assignment............................................... 33
Section 10.4 Notices.................................................. 34
Section 10.5 Modifications............................................ 35
Section 10.6 Entire Agreement......................................... 35
Section 10.7 Further Assurances....................................... 35
Section 10.8 Counterparts............................................. 35
Section 10.9 Facsimile Signatures..................................... 35
Section 10.10 Severability............................................ 35
Section 10.11 Applicable Law.......................................... 36
Section 10.12 No Third-Party Beneficiary.............................. 36
Section 10.13 Captions................................................ 36
Section 10.14 Construction............................................ 36
Section 10.15 Recordation............................................. 36
4
SCHEDULES:
1 DESCRIPTION OF KOREIN GROUND LEASE
2 DESCRIPTION OF LIRR GROUND LEASE
EXHIBITS:
A-1 DESCRIPTION OF LAND SUBJECT TO KOREIN GROUND LEASE
A-2 DESCRIPTION OF LAND SUBJECT TO LIRR GROUND LEASE
B LIST OF PERSONAL PROPERTY
C LIST OF OPERATING AGREEMENTS
D LIST OF ENVIRONMENTAL REPORTS
E-1 FORM OF TENANT ESTOPPEL CERTIFICATE
E-2 FORM OF SELLER'S ESTOPPEL CERTIFICATE
F FORM OF KOREIN GROUND LEASE ASSIGNMENT
G FORM OF LIRR GROUND LEASE ASSIGNMENT
H FORM OF XXXX OF SALE
I FORM OF ASSIGNMENT OF LEASES
J FORM OF ASSIGNMENT OF CONTRACTS
K FORM OF TENANT NOTICE
L FORM OF FIRPTA CERTIFICATE
M LIST OF CERTAIN TENANT COSTS AND COMMISSIONS
N LIST OF BROKERAGE AGREEMENTS
O LIST OF SPECIFIED LITIGATION
O-1 LIST OF SPECIFIED LITIGATION
P LIST OF VIOLATION NOTICES
Q RENT ROLL
R LIST OF UNACCEPTABLE TITLE MATTERS, IF ANY
S SECURITY DEPOSITS
T SPECIAL ASSESSMENTS
U LIST OF EXCEPTIONS TO REPRESENTATIONS IN SECTION 5.1(n)
5
SALE AGREEMENT
THIS SALE AGREEMENT (this "Agreement") is made as of the Effective Date
(as defined in Section 4.1 hereof) by and between MID-CITY ASSOCIATES, a New
York partnership, having an office at 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx
("Seller"), and ONE PENN PLAZA LLC, a New York limited liability company having
an office c/o Mendik Management Company, Inc., 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000 ("Purchaser").
W I T N E S S E T H:
ARTICLE I
PURCHASE AND SALE
Section 1.1 Agreement of Purchase and Sale. Subject to the terms and
conditions hereinafter set forth, Seller agrees to sell and convey to Purchaser,
and Purchaser agrees to purchase from Seller, the following:
(a) the entire right, title and interest of the ground lessee under that
certain ground lease (the "Korein Ground Lease") more particularly described in
Schedule 1 attached hereto (the "Korein Ground Leasehold Estate") which covers a
portion of the land located at Xxx Xxxx Xxxxx, 000 Xxxx 00xx Xxxxxx, New York,
New York, more particularly described on Exhibit A-1 attached hereto;
(b) the entire right, title and interest of the ground lessee under that
certain ground lease (the "LIRR Ground Lease") more particularly described in
Schedule 2 attached hereto (the "LIRR Ground Leasehold Estate") which covers a
portion of the land located at Xxx Xxxx Xxxxx, 000 Xxxx 00xx Xxxxxx, New York,
New York, more particularly described on Exhibit A-2 attached hereto (the land
described on Exhibit A-1 and Exhibit A-2 being herein referred to collectively
as the "Land");
(c) any and all of Seller's right, title and interest in and to the
buildings, structures, fixtures and other improvements affixed to or located on
the Land, excluding fixtures owned by tenants (the property described in clause
(c) of this Section 1.1 being herein referred to collectively as the
"Improvements");
(d) any and all of Seller's right, title and interest in and to all
tangible personal property located upon the Land or within the Improvements,
including, without limitation, any and all appliances, furniture, carpeting,
draperies and curtains, tools and supplies, and other items of personal property
owned by Seller (excluding cash and any software), located on and used
exclusively in connection with the operation of the Land and the Improvements,
it being understood that this sale includes, without limitation, the personal
property listed on Exhibit B attached hereto (the property described in clause
(d) of this
6
Section 1.1 being herein referred to collectively as the "Personal Property");
(e) the interest of the lessor in and to the leases, licenses and
occupancy agreements covering all or any portion of the Real Property (as such
term is defined in Section 1.2 hereof) to the extent they are in effect on the
date of the Closing (as such term is defined in Section 4.1 hereof) (the
property described in clause (e) of this Section 1.1 being herein referred to
collectively as the "Leases"), together with all rents and other sums due
thereunder (the "Rents") and any and all security deposits in Seller's
possession in connection therewith (the "Security Deposits");
(f) any and all of Seller's right, title and interest in and to (i) all
assignable contracts and agreements (collectively, the "Operating Agreements")
listed and described on Exhibit C attached hereto and made a part hereof,
relating to the upkeep, repair, maintenance or operation of the Land,
Improvements or Personal Property, and (ii) all assignable existing warranties
and guaranties (express or implied) issued to Seller in connection with the
Improvements or the Personal Property, and (iii) all assignable existing
permits, licenses, approvals and authorizations issued by any governmental
authority in connection with the Property, and (iv) the non-exclusive right to
the name "One Penn Plaza" (the property described in clause (f) of this Section
1.1 being sometimes herein referred to collectively as the "Intangibles"); and
(g) the interest of the lessee in and to that certain lease between The
Bowery Savings Bank, as lessor, and Mid-City Associates, as lessee, dated as of
April 30, 1969, as amended by letter agreement between The Long Island Railroad
and Mid-City Associates dated February 25, 1997, covering certain space on the
level of the Long Island Railroad Concourse of Pennsylvania Station (the
"Sub-Sublease"; such leasehold, the "Sub-Subleasehold Estate").
Section 1.2 Property Defined. The Land and the Improvements are
hereinafter sometimes referred to collectively as the "Real Property." The
Korein Ground Leasehold Estate, the LIRR Ground Leasehold Estate, the
Improvements, the Personal Property, the Leases, the Intangibles and the
Sub-Subleasehold Estate are herein sometimes referred to collectively as the
"Property."
Section 1.3 Purchase Price. Seller is to sell and Purchaser is to purchase
the Property for the amount of Four Hundred Ten Million and 00/100 Dollars
($410,000,000.00) (the "Purchase Price").
7
Section 1.4 Payment of Purchase Price. The Purchase Price, less the
Deposit (as such term is defined in Section 1.5 hereof), and as otherwise
increased or decreased by prorations and adjustments as herein provided, shall
be payable in full at Closing by wire transfer of immediately available funds to
a bank account designated by Seller in writing to Purchaser prior to the
Closing. Seller shall provide wiring instructions to Purchaser not later than
the fifth (5th) business day before the Closing.
Section 1.5 Deposit. Simultaneously with the execution and delivery of
this Agreement by Purchaser, Purchaser is depositing (or causing to be
deposited) with The Chase Manhattan Bank (the "Escrow Agent") the sum of
Forty-One Million and 00/100 Dollars ($41,000,000.00)(together with all interest
thereafter earned thereon, the "Deposit") in good funds, by certified check or
bank cashier's check drawn on a New York City bank. The Escrow Agent shall hold
the Deposit in escrow and dispose of the Deposit solely in accordance with the
terms of the Escrow Agreement entered into on the Purchaser Execution Date (as
defined in Section 4.1 hereof) by MetLife, Purchaser and Escrow Agent (the
"Escrow Agreement"). All interest earned on the Deposit in such escrow account
shall be deemed income of Purchaser, and Purchaser shall be responsible for the
payment of all costs and fees imposed on such escrow account on the terms set
forth therein. If and when Seller executes and delivers this Agreement, Seller
shall simultaneously execute and deliver the Escrow Agreement.
8
ARTICLE II
TITLE AND SURVEY
Section 2.1 Existing Title And Survey Matters. Purchaser acknowledges and
agrees that: (a) Seller has furnished Purchaser, prior to the Purchaser
Execution Date, with copies of: (i) a certificate of title (the "Certificate of
Title"), dated April 28, 1997 (Title No. 9701-00590) (the "Title Inspection
Date") for the Real Property prepared by Chicago Title Insurance Company; and
(ii) a copy of Seller's survey (the "Survey"), prepared by Xxxxxxx Surveying
P.C. dated July 30, 1997, for the Land and the Improvements; (b) Purchaser has
had an opportunity, prior to the Purchaser Execution Date, to order its own
title report and survey for the Land and the Improvements; and (c) any and all
matters (the "Existing Title And Survey Matters") referred to, reflected in or
disclosed by, the materials referred to in the preceding sub-paragraphs (a)(i)
and (ii), inclusive, except for those matters listed on Exhibit R attached
hereto and made a part hereof, have been agreed to and accepted by Purchaser,
and, as of the Title Inspection Date, Purchaser has approved the condition of
title to the Real Property, except for those matters listed on Exhibit R
attached hereto. Notwithstanding anything to the contrary set forth herein,
Seller shall be obligated to cure or remove (I) the items described in Exhibit R
attached hereto, (II) liens, mortgages and any other title encumbrances, other
than Permitted Exceptions (as defined below in Section 2.3 hereof), that may be
cured solely by the payment of a liquidated amount of money, provided, however,
that Seller's maximum liability under this clause (II) shall not exceed in the
aggregate Five Hundred Thousand Dollars ($500,000.00), and (III) liens,
mortgages and any other title encumbrances that Seller granted or to which
Seller otherwise expressly consented after the Title Inspection Date or that one
of the partners comprising Seller placed or caused to be placed against the
Property after the Effective Date (the matters described in clauses (I), (II)
and (III) above being collectively referred to herein as "Curable Matters") and
provided further that Purchaser shall have the right to terminate this Agreement
by written notice to Seller if (w) governmental violations arise after the
Purchaser Execution Date, (x) the aggregate reasonable cost of curing such
violations will exceed the sum of Fifty Thousand Dollars ($50,000.00), (y)
Seller elects not to cure or pay a portion of the cost of curing such violations
so that Purchaser's cost of curing such violations shall not exceed the sum of
Fifty Thousand Dollars ($50,000.00), and (z) such violations are not the result
of actions taken by Purchaser or its agents other than requesting customary
searches of municipal records.
Section 2.2 Pre-Closing "Gap" Title Defects. Purchaser may, at or prior to
Closing, notify Seller in writing (the "Gap Notice") of any objections to title
(a) raised between the
9
Purchaser Execution Date and the Closing by the title insurance company (the
"Title Company") that Purchaser elects to use for this transaction, and (b) not
disclosed to Purchaser by the issuer of the Certificate of Title or Seller prior
to the Title Inspection Date; provided that Purchaser agrees to promptly notify
Seller of any such objections to title promptly after being made aware of the
existence of any such exception. If Purchaser sends a Gap Notice to Seller,
Seller, within five (5) business days after the date when Seller receives the
Gap Notice, shall notify Purchaser whether Seller, at Seller's option, shall
either (a) remove such objectionable exceptions from title on or before the
Closing (provided that Seller may extend the Closing for such period as shall be
required to effect such cure, but not beyond sixty (60) days); or (b) not cause
such exceptions to be removed, provided that nothing contained in this clause
(b) shall relieve Seller of its obligation to remove Curable Matters. If Seller
gives Purchaser notice under clause (b) above, Purchaser shall have five (5)
business days (but in all events must do so at or prior to the Closing) in which
to notify Seller that Purchaser will nevertheless proceed with the purchase and
take title to the Property subject to such exceptions, or that Purchaser will
terminate this Agreement. If this Agreement is terminated pursuant to the
foregoing provisions of this paragraph, then neither party shall have any
further rights or obligations hereunder (except for any indemnity obligations of
either party pursuant to the other provisions of this Agreement that otherwise
survive the termination of this Agreement), the Deposit shall be returned to
Purchaser and each party shall bear its own costs incurred hereunder. If
Purchaser shall fail to notify Seller of its election within said five business
day period, Purchaser shall be deemed to have elected to proceed with the
purchase and take title to the Property subject to such exceptions (except to
the extent such exceptions constitute Curable Matters).
Section 2.3 Permitted Exceptions. The Property shall be conveyed subject
to the following matters, which are herein referred to as the "Permitted
Exceptions":
(a) each and all of the Existing Title And Survey Matters not listed on
Exhibit R attached hereto;
(b) matters that either are (x) not objected to in writing within the time
periods provided in Sections 2.2, or (y) if objected to in writing by Purchaser,
those which Seller has elected not to remove or cure, or has been unable to
remove or cure, and, with respect to the matters described in clause (x) and
clause (y) above are matters in respect of which Seller is not otherwise
obligated to remove or cure, and subject to which Purchaser has elected or is
deemed to have elected to accept the conveyance of the Property;
10
(c) the rights of tenants under the Leases, as tenants only, provided that
Seller shall not be obligated to give any representations to the Title Company
as to the rights of tenants;
(d) the lien of all ad valorem real estate taxes and assessments not yet
due and payable as of the date of Closing, subject to adjustment as herein
provided;
(e) local, state and federal laws, ordinances or governmental regulations,
including but not limited to, building and zoning laws, ordinances and
regulations, now or hereafter in effect relating to the Property; and
(f) any governmental violations arising prior to the Purchaser Execution
Date with respect to the Property of which Seller shall have received written
notice on or before the Purchaser Execution Date and any governmental violations
arising on or after the Purchaser Execution Date with respect to the Property
(subject to the right of Purchaser to terminate this Agreement under the terms
of Section 2.1 hereof if the cost of curing any governmental violations arising
after the Purchaser Execution Date will exceed in the aggregate Fifty Thousand
Dollars ($50,000.00));
Section 2.4 Conveyance of Title to the Ground Leasehold Estates. At
Closing, Seller shall convey and transfer to Purchaser (i) title to the Korein
Ground Leasehold Estate, free and clear of all liens and encumbrances other than
the Permitted Exceptions, by execution and delivery of the Korein Ground Lease
Assignment (as defined in Section 4.2(a) hereof); (ii) title to the LIRR Ground
Leasehold Estate, free and clear of all liens and encumbrances other than the
Permitted Exceptions, by execution and delivery of the LIRR Ground Lease
Assignment (as defined in Section 4.2(a) hereof), and (iii) all of Seller's
right, title and interest, if any, in and to the Improvements, free and clear of
all liens and encumbrances other than the Permitted Exceptions, but subject to
the interest of the respective landlords under the Korein Ground Lease and the
LIRR Ground Lease and anyone claiming an interest therein by, through or under
such landlords, by execution and delivery of the Korein Ground Lease Assignment
and the LIRR Ground Lease Assignment. Purchaser shall not be obligated to
consummate the transaction contemplated by this Agreement if the Title Company's
title insurance commitment refuses to insure, upon the payment of a standard
premium, that Purchaser will own the Korein Ground Leasehold Estate, the LIRR
Ground Leasehold Estate and the Improvements (subject to the ownership interest
therein by the respective landlords under and pursuant to the Korein Ground
Lease and the LIRR Ground Lease) free and clear of all liens and encumbrances
other than the Permitted Exceptions.
11
ARTICLE III
CONDITION OF PROPERTY
Section 3.1 "As Is" Condition. Purchaser acknowledges that it has
inspected the Property, is familiar with the condition thereof, and is
purchasing the Property "As Is" on the Purchaser Execution Date, subject to
reasonable use, wear, tear and natural deterioration between the Purchaser
Execution Date and the Closing. This Agreement, as written, contains all the
terms of the Agreement between the parties, and Purchaser acknowledges that
neither Seller nor any other person has made any representations or warranties
nor held out any inducement to Purchaser other than those expressly set forth
herein.
Section 3.2 Environmental Reports. PURCHASER ACKNOWLEDGES THAT (1)
PURCHASER HAS RECEIVED COPIES OF THE ENVIRONMENTAL REPORTS LISTED ON EXHIBIT D
ATTACHED HERETO, (2) IF SELLER DELIVERS ANY ADDITIONAL ENVIRONMENTAL REPORTS TO
PURCHASER, PURCHASER WILL ACKNOWLEDGE IN WRITING THAT IT HAS RECEIVED SUCH
REPORTS PROMPTLY UPON RECEIPT THEREOF, AND (3) ANY ENVIRONMENTAL REPORTS
DELIVERED OR TO BE DELIVERED BY SELLER OR ITS AGENTS OR CONSULTANTS TO PURCHASER
ARE BEING MADE AVAILABLE SOLELY AS AN ACCOMMODATION TO PURCHASER AND MAY NOT BE
RELIED UPON BY PURCHASER IN CONNECTION WITH THE PURCHASE OF THE PROPERTY.
PURCHASER AGREES THAT SELLER SHALL HAVE NO LIABILITY OR OBLIGATION WHATSOEVER
FOR ANY INACCURACY IN OR OMISSION FROM ANY ENVIRONMENTAL REPORT. PURCHASER HAS
PRIOR TO THE PURCHASER EXECUTION DATE (AS DEFINED IN SECTION 4.1 HEREOF)
CONDUCTED ITS OWN INVESTIGATION OF THE ENVIRONMENTAL CONDITION OF THE PROPERTY
TO THE EXTENT PURCHASER DEEMS SUCH AN INVESTIGATION TO BE NECESSARY OR
APPROPRIATE.
Section 3.3 Review of Tenant Estoppels. Promptly after the Effective Date,
Seller shall deliver to each tenant of the Property an estoppel certificate in
substantially the form of Exhibit E-1 attached hereto (the "Tenant Estoppels"),
and shall request that the tenants complete and sign the Tenant Estoppels and
return them to Seller. Seller shall deliver copies of any and all completed
Tenant Estoppels to Purchaser as Seller receives them; provided, however, that
Purchaser shall not be obligated to close hereunder unless Tenant Estoppels,
dated not more than sixty (60) days prior to the date of the Closing, are
delivered to Purchaser for at least seventy-five per cent (75%) of those tenants
leasing twenty-five thousand (25,000) square feet of rentable space or more. If
Seller does not deliver the required number of Tenant Estoppels to Purchaser, as
aforesaid, then Seller shall provide Purchaser at the Closing with a Seller's
estoppel, in the form attached hereto as Exhibit E-2 (the "Seller's
Certificate") for those space tenants necessary to satisfy the required number
of Tenant Estoppels to be delivered by Seller to Purchaser. Seller's liability
with respect to any Seller's estoppel to the extent delivered to Purchaser, as
aforesaid, shall survive the Closing until the earlier to occur
12
of: (i) one (1) year from the date of the Closing; or (ii) the date that a
Tenant Estoppel satisfying the requirements of this Agreement is obtained from
the applicable tenant (it being understood and agreed that a Tenant Estoppel
shall be deemed to satisfy the requirements of this Agreement if (i) such Tenant
Estoppel does not contain any material changes from the forms attached hereto,
and (ii) does not contain any information that differs materially from the
information set forth in Exhibits Q and S attached hereto). Purchaser shall have
no obligation to consummate the transaction contemplated hereby unless, at the
Closing, Purchaser receives a Tenant Estoppel or a Seller's Certificate for 75%
of those tenants leasing 25,000 square feet of rentable space or more which does
not contain any material changes from the forms attached hereto and does not
contain any information that differs materially from the information set forth
in Exhibits Q and S attached hereto.
Section 3.4 Korein Ground Landlord Estoppel. Promptly after the Effective
Date, Seller shall request an estoppel statement, in the form attached as
Schedule A-1, from the landlord of the Korein Ground Lease, which is as
described in, and is in accordance with the terms of, the Korein Ground Lease
(the "Korein Ground Landlord Estoppel"). It shall be a condition to Purchaser's
obligation to close hereunder that the Korein Ground Landlord Estoppel be
received from the landlord of the Korein Ground Lease and that it be reasonably
acceptable to Purchaser. The Korein Ground Landlord Estoppel received from the
landlord of the Korein Ground Lease will satisfy Purchaser's condition to close
if it: (x) is dated no more than forty-five (45) days before the Closing Date,
and (y) is in the form attached hereto as Schedule A-1 without any substantive
changes having been made by the landlord of the Korein Ground Lease.
Section 3.5 LIRR Ground Landlord Estoppel. Promptly after the Effective
Date, Seller shall request an estoppel statement, in the form attached as
Schedule A-2, from the landlord of the LIRR Ground Lease, which is as described
in, and is in accordance with the terms of, the LIRR Ground Lease (the "LIRR
Ground Landlord Estoppel"). It shall be a condition to Purchaser's obligation to
close hereunder that the LIRR Ground Landlord Estoppel be received from the
landlord of the LIRR Ground Lease and that it be reasonably acceptable to
Purchaser. The LIRR Ground Landlord Estoppel received from the landlord of the
LIRR Ground Lease will satisfy Purchaser's condition to close if it: (x) is
dated no more than forty-five (45) days before the Closing Date, and (y) is in
the form attached hereto as Schedule A-2 without any substantive changes having
been made by the landlord of the LIRR Ground Lease.
ARTICLE IV
CLOSING
13
Section 4.1 Time and Place. The consummation of the transaction
contemplated hereby (the "Closing") shall be held at the offices of Metropolitan
Life Insurance Company, one of the partners of Seller, at 000 Xxxx Xxxxxx, 00xx
Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, on a business day that is mutually acceptable
to Seller and Purchaser and that is not less than sixty (60) days nor more than
ninety (90) days after the Purchaser Execution Date. At the Closing, Seller and
Purchaser shall perform the obligations set forth in, respectively, Section 4.2
and Section 4.3 hereof, the performance of which obligations shall be concurrent
conditions. For purposes of this Agreement, the term "Purchaser Execution Date"
means the date that this Agreement is executed by Purchaser (which date is set
forth on the last page of this Agreement next to the signature block of the
Purchaser), and the term "Effective Date" means the date that this Agreement is
executed and delivered by Seller.
Section 4.2 Seller's Obligations at Closing. At Closing, Seller shall:
(a) deliver to Purchaser (i) a duly executed Assignment and Assumption of
Lessee's Interest in the Korein Ground Lease (the "Korein Ground Lease
Assignment") in the form attached hereto as Exhibit F, conveying the Korein
Ground Leasehold Estate, subject only to the Permitted Exceptions on the terms
set forth herein, and (ii) a duly executed Assignment and Assumption of Lessee's
Interest in the LIRR Ground Lease (the "LIRR Ground Lease Assignment") in the
form attached hereto as Exhibit G, conveying the LIRR Ground Leasehold Estate,
subject only to the Permitted Exceptions on the terms set forth herein;
(b) deliver to Purchaser a duly executed xxxx of sale (the "Xxxx of Sale")
conveying the Personal Property without warranty of title or use and without
warranty, express or implied, as to merchantability and fitness for any purpose
and in the form attached hereto as Exhibit H;
(c) deliver to Purchaser an assignment and assumption agreement (the
"Assignment of Leases") in the form attached hereto as Exhibit I, duly executed
by Seller, regarding the Leases, Rents and Security Deposits and the
Sub-Subleasehold Estate;
(d) to the extent assignable, assign to Purchaser, and Purchaser shall
assume, Seller's interest in the Operating Agreements and the other Intangibles
by duly executed assignment and assumption agreement (the "Assignment of
Contracts") in the form attached hereto as Exhibit J on the terms set forth
therein;
(e) join with Purchaser in executing a notice (the "Tenant Notice") in the
form attached hereto as Exhibit K, which Purchaser shall send to each tenant
under each of the Leases
14
promptly after the Closing informing such tenant of the sale of the Property and
of the assignment to Purchaser of Seller's interest in, and obligations under,
the Leases (including, if applicable, any Security Deposits), and directing that
all Rent and other sums payable after the Closing under each such Lease be paid
as set forth in the notice; Seller shall also deliver to each of the landlords
under the Korein Ground Lease and the LIRR Ground Lease promptly after the
Closing notices of the respective sale of the Korein Ground Leasehold Estate and
the LIRR Ground Leasehold Estate pursuant to this Agreement.
(f) In the event that any representation or warranty of Seller needs to be
modified due to changes since the Effective Date, deliver to Purchaser a
certificate, dated as of the date of Closing and executed on behalf of Seller by
a duly authorized representative thereof, identifying any representation or
warranty which is not, or no longer is, true and correct and explaining the
state of facts giving rise to the change. In no event shall Seller be liable to
Purchaser for, or be deemed to be in default hereunder by reason of, any breach
of representation or warranty which results from any change of facts that (i)
occurs between the Effective Date and the date of Closing, and (ii) is beyond
the reasonable control of Seller to prevent and otherwise does not result from a
breach of any covenant made by Seller hereunder; provided, however, that the
occurrence of a change of facts which is beyond the reasonable control of Seller
to prevent (and does not result from a breach of any covenant made by Seller
hereunder) shall, if materially adverse to Purchaser, constitute the
non-fulfillment of the condition set forth in Section 4.6(b) hereof; if, despite
changes or other matters described in such certificate, the Closing occurs,
Seller's representations and warranties set forth in this Agreement that are
restated on and as of the Closing Date shall be deemed to have been modified by
all statements made in such certificate;
(g) deliver to Purchaser such evidence as the Title Company may reasonably
require as to the authority of the person or persons executing documents on
behalf of Seller;
(h) deliver to Purchaser a certificate in the form attached hereto as
Exhibit L duly executed by Seller stating that Seller is not a "foreign person"
as defined in the Federal Foreign Investment in Real Property Tax Act of 1980;
(i) deliver to Purchaser, original executed counterparts of the Korein
Ground Lease, the LIRR Ground Lease, the Leases and the Operating Agreements (it
being understood and agreed that Seller, in lieu of delivering to Purchaser
original executed counterparts of the Leases and the Operating Agreements, shall
have the right to deliver to Purchaser photocopies thereof if
15
Seller does not have original executed counterparts in Seller's possession),
together with such leasing and property files and records located at the
Improvements or the property manager's office which are material in connection
with the continued operation, leasing and maintenance of the Property, but
excluding any internal memoranda or minutes, financial projections, budgets,
appraisals, accounting and tax records and similar proprietary information. For
a period of three (3) years after the Closing, Purchaser shall allow Seller and
its agents and representatives access without charge at Purchaser's offices to
all files, records and documents delivered to Purchaser at the Closing, upon
reasonable advance notice and at all reasonable times, to examine and make
copies of any and all such files, records and documents, which right shall
survive the Closing for three (3) years;
(j) deliver such affidavits as may be customarily and reasonably required
by the Title Company, in a form reasonably acceptable to Seller;
(k) deliver to Purchaser possession and occupancy of the Property
(subject to the Permitted Exceptions), along with any existing keys to the
Property properly tagged for identification;
(l) execute a closing statement acceptable to Seller and Purchaser;
(m) if Seller shall have received the Korein Ground Landlord Estoppel,
deliver to Purchaser the Korein Ground Landlord Estoppel. If Seller does not
receive the Korein Ground Landlord Estoppel (or if the Korein Ground Landlord
Estoppel indicates that either a default exists or that the Korein Ground Lease
is not in full force and effect, or if the Korein Ground Landlord Estoppel has
otherwise been substantively changed), Purchaser shall have the right to elect
to terminate this Agreement by written notice to Seller. Upon such termination,
the Deposit shall be promptly refunded to Purchaser, and upon such refund,
neither party hereto shall have any further rights or obligations hereunder
except for those rights or obligations that this Agreement expressly provides
will survive any termination of this Agreement;
(n) if Seller shall have received the LIRR Ground Landlord Estoppel,
deliver to Purchaser the LIRR Ground Landlord Estoppel. If Seller does not
receive the LIRR Ground Landlord Estoppel (or the LIRR Ground Landlord Estoppel
indicates that either a default exists or that the LIRR Ground Lease is not in
full force and effect, or if the LIRR Ground Landlord Estoppel has otherwise
been substantively changed), Purchaser shall have the right to elect to
terminate this Agreement by written notice to Seller. Upon such termination, the
Deposit shall be promptly refunded to Purchaser, and upon such refund, neither
party hereto
16
shall have any further rights or obligations hereunder except for those rights
or obligations that this Agreement expressly provides will survive any
termination of this Agreement;
(o) deliver all Tenant Estoppels received by Seller and not previously
furnished to Purchaser, and, if required to be delivered pursuant to Section
3.3, the Seller's Certificate (with the understanding that Purchaser has the
right to terminate this Agreement, and receive repayment of the Deposit, if the
Tenant Estoppels and the Seller Certificate do not satisfy the requirements
described in Section 3.3 hereof); and
(p) deliver such additional documents as shall be reasonably required to
consummate the transaction contemplated by this Agreement.
Section 4.3 Purchaser's Obligations at Closing. At Closing, Purchaser
shall:
(a) pay to Seller the full amount of the Purchase Price, less the Deposit,
and as otherwise increased or decreased by prorations and adjustments as herein
provided, in immediately available wire transferred funds pursuant to Section
1.4 hereof;
(b) join Seller in execution of the Korein Ground Lease Assignment, the
LIRR Ground Lease Assignment, the Assignment of Leases, the Assignment of
Contracts and the Tenant Notices;
(c) In the event that any representation or warranty of Purchaser set
forth in Sections 5.5(a) or (b) hereof needs to be modified due to changes since
the Purchaser Execution Date, deliver to Seller a certificate, dated as of the
date of Closing and executed on behalf of Purchaser by a duly authorized
representative thereof, identifying any such representation or warranty which is
not, or no longer is, true and correct and explaining the state of facts giving
rise to the change. In no event shall Purchaser be liable to Seller for, or be
deemed to be in default hereunder by reason of, any breach of representation or
warranty set forth in Sections 5.5(a) or (b) hereof which results from any
change of facts that (i) occurs between the Effective Date and the date of
Closing, and (ii) is beyond the reasonable control of Purchaser to prevent and
otherwise does not result from a breach of any covenant made by Purchaser
hereunder; provided, however, that the occurrence of a change of facts which is
beyond the reasonable control of Purchaser to prevent (and does not result from
a breach of any covenant made by Purchaser hereunder) shall, if materially
adverse to Seller, constitute the non-fulfillment of the condition set forth in
Section 4.7(c) hereof; if, despite changes or other matters described in such
certificate, the Closing occurs, Purchaser's representations and
17
warranties set forth in this Agreement shall be deemed to have been modified by
all statements made in such certificate;
(d) deliver to Seller such evidence as the Title Company may reasonably
require as to the authority of the person or persons executing documents on
behalf of Purchaser;
(e) deliver such affidavits as may be customarily and reasonably required
by the Title Company, in a form reasonably acceptable to Purchaser;
(f) execute a closing statement acceptable to Purchaser and Seller;
(g) deliver such additional documents as shall be reasonably required to
consummate the transaction contemplated by this Agreement; and
(h) join with Seller in causing the Escrow Agent to pay the Deposit to
Seller by wire transfer of immediately available funds to a bank account
designated by Seller in writing at least five (5) business days before the
Closing.
Section 4.4 Credits and Prorations.
(a) All income and expenses of the Property shall be apportioned as of
12:01 a.m., on the day of Closing, as if Purchaser were vested with title to the
Property during the entire day upon which Closing occurs. Such prorated items
shall include without limitation the following:
(i) all Rents, if any, and any rent or other charges paid or payable
by the tenant under the Korein Ground Lease or the LIRR Ground Lease;
(ii) taxes and assessments (including personal property taxes on the
Personal Property) levied against the Property;
(iii) utility charges other than those for which Tenants are
responsible for making direct payments to the utility company, if any, such
charges to be apportioned at Closing on the basis of the most recent meter
reading occurring prior to Closing (dated not more than five (5) business days
prior to Closing) or, if unmetered, on the basis of a current xxxx for each such
utility;
(iv) all amounts payable under brokerage agreements and Operating
Agreements, in either case solely to the extent provided in this Agreement;
(v) wages, fringe benefits, payroll taxes, employment insurance
contributions, accrued vacation pay, sick leave and
18
other compensation of building employees retained by Purchaser to the extent
allowable under the applicable union contract; and
(vi) any other operating expenses or other items pertaining to the
Property which are customarily prorated between a purchaser and a seller in the
county in which the Property is located.
(b) Notwithstanding anything contained in Section 4.4(a) hereof:
(i) At Closing, (A) Seller shall, at Seller's option, either deliver
to Purchaser any Security Deposits (including an assignment of any
letters-of-credit constituting any of the Security Deposits, with any costs
relating to such assignment being paid equally by Seller and Purchaser;
provided, however, that Seller shall cause those letters of credit that are not
assignable to be reissued in Purchaser's name, with the understanding that such
letters of credit may be reissued after the date of Closing and Seller's
obligation with respect to such letters of credit shall survive the Closing)
actually held by Seller pursuant to the Leases or credit to the account of
Purchaser the amount of such Security Deposits (to the extent such Security
Deposits have not been applied against delinquent Rents or otherwise as provided
in the Leases, it being agreed that Seller shall not be entitled to apply any
Security Deposits against delinquent Rents unless the Rents have been delinquent
for more than thirty (30) days), and (B) Purchaser shall credit to the account
of Seller all refundable cash or other deposits posted with utility companies
serving the Property, or, at Seller's option, Seller shall be entitled to
receive and retain such refundable cash and deposits (in which case there shall
not be an apportionment for such deposits);
(ii) Any taxes and assessments levied against the Real Property paid
at or prior to Closing shall be prorated based upon the amounts actually paid
(it being agreed that Seller shall pay any taxes and assessments due prior to
the Closing and in such event shall be entitled to a credit as required by this
Agreement), however, if taxes and assessments due and payable during the year of
Closing have not been paid before Closing, Seller shall be charged at Closing an
amount equal to that portion of such taxes and assessments which relates to the
period before Closing. Any such apportionment made with respect to a tax year
for which the tax rate or assessed valuation, or both, have not yet been fixed
shall be based upon the tax rate and/or assessed valuation last fixed. To the
extent that the actual taxes and assessments for the current year differ from
the amount apportioned at Closing, the parties shall make all necessary
adjustments by appropriate payments between themselves within
19
thirty (30) days after such amounts are determined following Closing, subject to
the provisions of Section 4.4(d) hereof;
(iii) As to utility charges referred to in Section 4.4(a)(iii)
hereof, Seller may on notice to Purchaser elect to pay one or more of all of
said items accrued to the date hereinabove fixed for apportionment directly to
the person or entity entitled thereto, and to the extent Seller so elects, such
item shall not be apportioned hereunder, and Seller's obligation to pay such
item directly in such case shall survive the Closing or any termination of this
Agreement;
(iv) Purchaser shall be responsible for the payment of (A) all
Tenant Inducement Costs (as hereinafter defined) and leasing commissions which
become due and payable (whether before or after Closing) as a result of any new
Leases, or any renewals, amendments or expansions of existing Leases, signed
during the Lease Approval Period (as hereinafter defined) and approved by
Purchaser in accordance with Section 5.4 hereof; and (B) all Tenant Inducement
Costs and leasing commissions with respect to new Leases, or renewals,
amendments or expansions of existing Leases, signed or entered into from and
after the date of Closing; and (C) all Tenant Inducement Costs and leasing
commissions listed on Exhibit M attached hereto, provided, however, that (i) in
no event shall Purchaser have any obligation to pay Tenant Inducement Costs or
leasing commissions if the Closing does not occur, (ii) Seller shall also be
responsible for certain Tenant Inducement Costs and leasing commissions shown on
Exhibit M, and (iii) the allocation of Tenant Inducement costs and leasing
commissions shown on Exhibit M will be readjusted as of the Closing Date based
upon the then existing state of facts. If, as of the date of Closing, Seller
shall have paid any Tenant Inducement Costs or leasing commissions for which
Purchaser is responsible pursuant to the foregoing provisions, Purchaser shall
reimburse Seller therefor at Closing, and in such event, Seller shall furnish
Purchaser prior to the Closing with reasonably satisfactory evidence of the
payment of such Tenant Inducement Costs and leasing commissions. For purposes
hereof, the term "Tenant Inducement Costs" shall mean any out-of-pocket payments
required under a Lease to be paid by the landlord thereunder to or for the
benefit of the tenant thereunder which is in the nature of a tenant inducement,
including specifically, without limitation, tenant improvement costs, lease
buyout costs, reasonable legal fees of Seller, and moving, design, refurbishment
and club membership allowances. The term "Tenant Inducement Costs" shall not
include loss of income resulting from any free rental period, it being agreed
that Seller shall bear the loss resulting from any free rental period until the
date of Closing and that Purchaser shall bear such loss from and after the date
of Closing. For purposes hereof, the term "Lease Approval Period" shall mean the
period from the Effective Date until the date of Closing; and
20
(v) Unpaid and delinquent Rent collected by Seller and Purchaser
after the date of Closing shall be delivered as follows: (a) if Seller collects
any unpaid or delinquent Rent for the Property, Seller shall, within ten (10)
days after the receipt thereof, deliver to Purchaser any such Rent which
Purchaser is entitled to hereunder, and (b) if Purchaser collects any unpaid or
delinquent Rent from the Property, Purchaser shall, within ten (10) days after
the receipt thereof, deliver to Seller any such Rent which Seller is entitled to
hereunder. Seller and Purchaser agree that all Rent received by Seller or
Purchaser after the date of Closing shall be applied first to the month of the
Closing; second to the month in which collected; and third any excess collected
in a month to delinquent rents in the inverse order of their occurrence (e.g.,
to the most recent delinquent month, and then to the next preceding delinquent
month). Purchaser will make a good faith effort after Closing to collect all
Rents in the usual course of Purchaser's operation of the Property, but
Purchaser will not be obligated to institute any lawsuit or other collection
procedures to collect delinquent Rents. Seller may attempt to collect any
delinquent Rents owed Seller and may institute any lawsuit or collection
procedures, but may not evict any tenant. In the event that there shall be any
Rents or other charges under any Leases which, although relating to a period
prior to Closing, do not become due and payable until after Closing or are paid
or payable prior to Closing but are subject to adjustment after Closing (such as
year end common area expense reimbursements and the like), then any Rents or
charges of such type received by Purchaser or its agents or Seller or its agents
subsequent to Closing shall, to the extent applicable to a period extending
through the Closing, be prorated between Seller and Purchaser as of Closing. Any
amounts collected by Seller prior to the Closing shall also be subject to
adjustment as and to the extent provided in this Section. Notwithstanding
anything to the contrary set forth in this Agreement, Seller shall be entitled
to pursue any of the ongoing or prospective litigation matters listed on
Exhibits O and O-1 hereto with respect to the period prior to the Closing and
shall be entitled to receive all rent arrearages, judgments, settlement proceeds
or other amounts that arise from such litigation and relate to events that
occurred during the period prior to the Closing (it being understood and agreed,
however, that Seller shall not have any right to terminate any Lease by virtue
of any such litigation after the Closing and that such litigation may not
diminish the rentals that Purchaser would otherwise be entitled to receive under
the Leases for the period from and after the Closing).
(c) Except as otherwise provided herein, any revenue or expense amount
which cannot be ascertained with certainty as of Closing shall be prorated on
the basis of the parties' reasonable estimates of such amount, and shall be the
subject of a final
21
proration ninety (90) days after Closing, or as soon thereafter as the precise
amounts can be ascertained. Purchaser and Seller shall each promptly notify each
other when it becomes aware that any such estimated amount has been ascertained.
Once all revenue and expense amounts have been ascertained, Purchaser shall
prepare, and certify as correct, a final proration statement which shall be
subject to Seller's reasonable approval. Upon Seller's acceptance and approval
of any final proration statement submitted by Purchaser, such statement shall be
conclusively deemed to be accurate and final.
(d) The provisions of this Section 4.4 shall survive Closing. Section 4.5
Transaction Taxes and Closing Costs.
(a) Seller and Purchaser at the Closing shall execute such returns,
questionnaires and other documents as shall be required with regard to all
applicable real property transaction taxes imposed by applicable federal, state
or local law or ordinance.
(b) Seller shall pay the fees of any counsel representing Seller in
connection with this transaction. Seller shall also pay the following costs and
expenses:
1. any transfer tax, sales tax, documentary stamp tax or similar tax which
becomes payable by reason of the transfer of the Property.
(c) Purchaser shall pay the fees of any counsel representing Purchaser in
connection with this transaction. Purchaser shall also pay the following costs
and expenses:
1. the fee for the title examination and issuance of purchaser's title
commitment and the premium for the Owner's Policy of Title Insurance to be
issued to Purchaser by the Title Company at Closing, and all endorsements
thereto;
2. the cost of any survey ordered by Purchaser;
3. the fees for recording the Korein Ground Lease Assignment and the LIRR
Ground Lease Assignment; and
4. the escrow fee, if any, which may be charged by the Escrow Agent.
(d) The Personal Property is included in this sale without charge, and no
portion of the Purchase Price is being attributed thereto.
(e) All costs and expenses incident to this transaction and the closing
thereof, and not specifically described above, shall be paid by the party
incurring same.
22
(f) The provisions of this Section 4.5 shall survive the Closing.
Section 4.6 Conditions Precedent to Obligation of Purchaser. The
obligation of Purchaser to consummate the transaction hereunder shall be subject
to the fulfillment on or before the date of Closing of all of the following
conditions (and any other conditions to Purchaser's obligation to consummate the
transaction contemplated hereby expressly set forth herein), any or all of which
may be waived by Purchaser in its sole discretion:
(a) Seller shall have delivered to Purchaser all of the items required to
be delivered to Purchaser pursuant to the terms of this Agreement, including but
not limited to, those provided for in Section 4.2 hereof, subject to the terms
of Section 4.2(m) and Section 4.2(n) hereof;
(b) All of the representations and warranties of Seller contained in this
Agreement shall be true and correct in all material respects as of the date of
Closing (with appropriate modifications solely to the extent permitted under
this Agreement); and
(c) Seller shall have performed and observed, in all material respects,
all covenants and agreements of this Agreement to be performed and observed by
Seller as of the date of Closing.
Section 4.7 Conditions Precedent to Obligation of Seller. The obligation
of Seller to consummate the transaction hereunder shall be subject to the
fulfillment on or before the date of Closing of all of the following conditions
(and, any other conditions to Seller's obligation to consummate the transaction
contemplated hereby expressly set forth herein), any or all of which may be
waived by Seller in its sole discretion:
(a) Seller shall have received (i) the balance of the Purchase Price as
adjusted as provided herein; and (ii) the Deposit, each pursuant to and payable
in the manner provided for in this Agreement;
(b) Purchaser shall have delivered to Seller all of the items required to
be delivered to Seller pursuant to the terms of this Agreement, including, but
not limited to, those provided for in Section 4.3 hereof;
(c) All of the representations and warranties of Purchaser contained in
this Agreement shall be true and correct in all material respects as of the date
of Closing (with appropriate modifications permitted under this Agreement); and
23
(d) Purchaser shall have performed and observed, in all material respects,
all covenants and agreements of this Agreement to be performed and observed by
Purchaser as of the date of Closing.
ARTICLE V
REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 5.1 Representations and Warranties of Seller. Seller hereby makes
the following representations and warranties to Purchaser as of the Effective
Date, which representations and warranties shall be deemed to have been made
again as of the Closing, subject to Section 4.2(f) hereof:
(a) Organization and Authority. Seller has been duly organized and is
validly existing under the laws of the State of New York. Seller has the full
right and authority to enter into this Agreement and to transfer all of the
Property and to consummate or cause to be consummated the transaction
contemplated by this Agreement. The person signing this Agreement on behalf of
Seller is authorized to do so. This Agreement has been duly executed and
delivered by Seller and is enforceable against Seller in accordance with its
terms (subject to bankruptcy, insolvency, and creditors' rights limitations and
laws generally and other general equitable principles).
(b) Pending Actions. Seller has not received written notice of any action,
suit, arbitration, unsatisfied order or judgment, government investigation or
proceeding pending, nor to Seller's knowledge is any such action, suit,
arbitration, unsatisfied order, judgment, government investigation or proceeding
threatened, against Seller, which, if adversely determined, could materially
interfere with the consummation of the transaction contemplated by this
Agreement.
(c) Operating Agreements. To Seller's knowledge, the Operating Agreements
listed on Exhibit C are all of the agreements concerning the operation and
maintenance of the Property entered into by Seller and affecting the Property,
except those operating agreements that are not assignable or are to be
terminated by Seller within thirty (30) days after the Closing, and except any
agreement with Seller's property manager, which shall be terminated by Seller.
True, correct and complete copies of the Operating Agreements have been made
available for Purchaser's inspection at the Property prior to the Purchaser
Execution Date.
(d) Lease Brokerage. To Seller's knowledge, there are no agreements with
brokers providing for the payment from and after the Closing by Seller or
Seller's successor-in-interest of leasing commissions or fees for procuring
tenants with respect to the Property, except as disclosed in Exhibit N hereto.
True, correct and complete copies of the brokerage agreements that
24
Seller expects Purchaser to assume as of the Closing Date have been made
available for Purchaser's inspection at the Property prior to the Purchaser
Execution Date.
(e) Condemnation. Seller has received no written notice of any outstanding
condemnation proceedings relating to the Property, and to Seller's knowledge, no
condemnation is threatened.
(f) Litigation. Except as set forth on Exhibit O attached hereto, and
except tenant eviction proceedings, tenant bankruptcies, and proceedings for the
collection of delinquent rentals from tenants, Seller has not instituted any
outstanding litigation that arises out of the ownership of the Property and
would materially affect the Property or use thereof, or Seller's ability to
perform hereunder.
(g) Violations. To Seller's knowledge, except as set forth on Exhibit P
attached hereto, Seller has not received written notice of any uncured violation
of any federal, state or local law relating to the use or operation of the
Property which would materially adversely affect the Property or use thereof.
(h) Leases. The rent roll attached hereto as Exhibit Q is accurate in all
material respects, and lists all of the leases currently affecting the Property.
True, correct and complete copies of the Leases and the Sub-Sublease have been
made available for Purchaser's inspection at the Property prior to the Purchaser
Execution Date.
(i) Tax Appeals. To Seller's knowledge, there are no real property tax
assessment appeals by Seller with respect to the Real Property pending for the
1997/98 tax year or any previous years.
(j) Ground Leases. To Seller's knowledge: (i) neither the Korein Ground
Lease nor the LIRR Ground Lease have been terminated; (ii) Seller is not in
default of any of Seller's obligations under either the Korein Ground Lease or
the LIRR Ground Lease; and (iii) the respective ground lessors under each of the
Korein Ground Lease and the LIRR Ground Lease are not in default of their
respective obligations thereunder.
(k) Security Deposits. To Seller's knowledge, Exhibit S attached hereto
contains an accurate listing of the Security Deposits (including any
letters-of-credit held as Security Deposits) currently held by Seller.
(l) Special Assessments. To Seller's knowledge, Seller has received no
notice of any special assessments levied against the Real Property, nor to
Seller's knowledge, are there any
25
special assessments currently pending against the Real Property, except as set
forth on the Certificate of Title or Exhibit T attached hereto.
(m) To Seller's knowledge, except as set forth in Exhibit U attached
hereto (i) neither Seller nor any tenant is in material default under the
applicable Lease and Seller is not in material default under the Sub-Sublease,
(ii) no tenant under any Lease has any offsets against rent (except as expressly
set forth in the applicable Lease), and (iii) no tenant is challenging any of
the rental due to Seller as landlord under the applicable Lease.
(n) True, correct and complete copies of the Korein Ground Lease and the
LIRR Ground Lease have been delivered to Purchaser on or before the Purchaser
Execution Date.
Notwithstanding anything to the contrary set forth in this Agreement,
Seller shall have no liability with respect to any of the representations and
warranties in this Section 5.1 from and after the Closing Date to the extent
that Purchaser receives a Tenant Estoppel before or after the Closing in
accordance with Section 3.3 hereof covering the same items to the extent
consistent with such representations and warranties.
Section 5.2 Knowledge Defined. References to the "knowledge" of Seller
shall refer only to the current actual knowledge of the Designated Employees (as
hereinafter defined), and shall not be construed, by imputation or otherwise, to
refer to the knowledge of Seller or any affiliate of Seller, or to any other
officer, agent, manager, representative or employee of Seller or any affiliate
thereof or to impose upon such Designated Employees any duty to investigate the
matter to which such actual knowledge, or the absence thereof, pertains. As used
herein, the term "Designated Employees" shall refer to the following persons:
(a) Xxxx Xxxxxxxx, Comptroller, (b) Xxxxxx Xxxxxxxx, Vice President, Operations,
and (c) Xxxxxx North, Vice President, Leasing of Helmsley-Spear, Inc.
Section 5.3 Survival of Seller's Representations and Warranties. The
representations and warranties of Seller set forth in Section 5.1 hereof as
updated as of the Closing in accordance with the terms of this Agreement, shall
survive Closing for a period of one (1) year. No claim for a breach of any
representation or warranty of Seller shall be actionable or payable if the
breach in question results from or is based on a condition, state of facts or
other matter which was known to Purchaser prior to Closing. Seller shall have no
liability to Purchaser for a breach of any representation or warranty (a) unless
the valid claims for all such breaches collectively aggregate more than One
Million Dollars ($1,000,000.00), in which event the full amount of such valid
claims shall be actionable, up to the Cap (as defined in this Section), (b)
unless written notice containing a description of the specific nature of such
breach shall have been given by Purchaser to Seller prior to the
26
expiration of said one (1) year period and an action shall have been commenced
by Purchaser against Seller within sixty (60) days of the expiration of said one
(1) year period, and/or (c) Purchaser did not have any knowledge as of the
Closing, of any state of facts which would result in a breach by Seller of any
of Seller's representations or warranties. As used herein, the term "Cap" shall
mean the total aggregate amount of Five Million Dollars ($5,000,000.00).
Section 5.4 Covenants of Seller. Seller hereby covenants with Purchaser as
follows:
(a) From the Effective Date hereof until the Closing or earlier
termination of this Agreement, Seller shall operate and maintain the Property in
a manner consistent with the manner in which Seller has operated and maintained
the Property prior to the date hereof.
(b) A statement of the Tenant Inducement Costs and leasing commissions
relating thereto along with a copy of any amendment, extension, renewal or
expansion of an existing Lease or of any new Lease which Seller wishes to
execute between the Effective Date and the date of Closing will be submitted to
Purchaser prior to execution by Seller. Purchaser agrees to notify Seller in
writing within five (5) business days after its receipt thereof of either its
approval or disapproval thereof, including all Tenant Inducement Costs and
leasing commissions to be incurred in connection therewith. In the event
Purchaser fails to notify Seller in writing of its approval or disapproval
within the five (5) business day period set forth above, Purchaser, as Seller's
sole remedy, shall be deemed to have disapproved of such new Lease, amendment,
renewal or expansion. If Purchaser disapproves or is deemed to have disapproved
of such new Lease, amendment, renewal or expansion, Seller shall not enter into
the same. Seller shall also have no right to terminate or agree to cancel any
Lease prior to the Closing without Purchaser's consent, not to be unreasonably
withheld, conditioned or delayed. At Closing, Purchaser shall reimburse Seller
for any Tenant Inducement Costs or leasing commissions incurred by Seller
pursuant to an amendment, a renewal, an expansion or a new Lease approved (or
deemed approved) by Purchaser.
(c) Seller, prior to the date of the Closing, shall perform all of the
obligations to be performed by the landlord under the Leases, and the respective
tenants under each of the Korein Ground Lease, the LIRR Ground Lease and the
Sub-Sublease, in every case to the extent arising during the period (the
"Contract Period") between the Effective Date and date of the Closing.
27
(d) Seller, during the Contract Period, shall perform all of the
obligations to be performed by Seller under the Operating Agreements, to the
extent arising during the Contract Period.
(e) Seller, during the Contract Period, shall not amend, supplement,
modify or terminate the Korein Ground Lease or the LIRR Ground Lease.
Section 5.5 Representations and Warranties of Purchaser. Purchaser hereby
makes the following representations and warranties to Seller as of the Effective
Date, which representations and warranties shall be deemed to have been made
again as of the Closing, subject to Section 4.3(c) hereof:
(a) Organization and Authority. Purchaser has been duly organized and is
validly existing under the laws of the State of New York. Purchaser has the full
right and authority to enter into this Agreement and to consummate or cause to
be consummated the transaction contemplated by this Agreement. The person
signing this Agreement on behalf of Purchaser is authorized to do so.
(b) Pending Actions. Purchaser has not received written notice of any
action, suit, arbitration, unsatisfied order or judgment, government
investigation or proceeding pending against Purchaser nor to Purchaser's
knowledge is any such action, suit, arbitration, unsatisfied order or judgment,
government investigation or proceeding threatened against Purchaser which, if
adversely determined, could materially interfere with the consummation of the
transaction contemplated by this Agreement.
(c) ERISA. As of the Closing, (1) Purchaser will not be an employee
benefit plan as defined in Section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), which is subject to Title I of
ERISA, nor a plan as defined in Section 4975(e)(1) of the Internal Revenue Code
of 1986, as amended (each of the foregoing hereinafter referred to collectively
as "Plan"), and (2) the assets of the Purchaser will not constitute "plan
assets" of one or more such Plans within the meaning of Department of Labor
("DOL") Regulation Section 2510.3-101.
As of the Closing, if Purchaser is a "governmental plan" as defined in
Section 3(32) of ERISA, the closing of the sale of the Property will not
constitute or result in a violation of state or local statutes regulating
investments of and fiduciary obligations with respect to governmental plans.
As of the Closing, Purchaser will be acting on its own behalf and not on
account of or for the benefit of any Plan.
Purchaser has no present intent to transfer the Property to any entity,
person or Plan which will cause a violation of ERISA.
28
Purchaser shall not assign its interest under this contract of sale to any
entity, person, or Plan which will cause a violation of ERISA.
Section 5.6 Survival of Purchaser's Representations and Warranties. The
representations and warranties of Purchaser set forth in Section 5.5 hereof as
updated as of the Closing in accordance with the terms of this Agreement, shall
survive Closing for a period of one (1) year. Purchaser shall have no liability
to Seller for a breach of any representation or warranty unless (a) written
notice containing a description of the specific nature of such breach shall have
been given by Seller to Purchaser prior to the expiration of said one (1) year
period and an action shall have been commenced by Seller against Purchaser
within sixty (60) days of the expiration of said one (1) year period; and/or (b)
Seller did not have any knowledge as of the Closing of any state of facts which
would result in a breach by Purchaser of any of Purchaser's representations or
warranties.
ARTICLE VI
DEFAULT
Section 6.1 Default by Purchaser. In the event the sale of the Property as
contemplated hereunder is not consummated due to Purchaser's default hereunder,
Seller shall be entitled, as its sole remedy, to terminate this Agreement and
receive the Deposit as liquidated damages for the breach of this Agreement, it
being agreed between the parties hereto that the actual damages to Seller in the
event of such breach are impractical to ascertain and the amount of the Deposit
is a reasonable estimate thereof.
Section 6.2 Default by Seller. In the event the sale of the Property as
contemplated hereunder is not consummated due to Seller's default hereunder,
Purchaser shall be entitled, as its sole remedy, either (a) to receive the
return of the Deposit, which return shall operate to terminate this Agreement
and release Seller from any and all liability hereunder, or (b) to enforce by
specific performance Seller's obligation to convey the Property to Purchaser in
accordance with the terms of this Agreement. Purchaser expressly waives its
rights to seek damages in the event of Seller's default hereunder, except for
Purchaser's right to pursue Seller for damages under Section 5.3 hereof and
except if the remedy of specific performance is not available because of
Seller's sale, transfer or other disposition of all or any material portion of
the Property or any material interest therein to another party while this
Agreement is in full force and effect. Purchaser shall be deemed to have elected
to terminate this Agreement and receive back the Deposit if
29
Purchaser fails to file suit for specific performance against Seller in a court
having jurisdiction in the county and state in which the Real Property is
located, on or before thirty (30) days following the date upon which Closing was
to have occurred.
Section 6.3 Recoverable Damages. Notwithstanding Sections 6.1 and 6.2
hereof, in no event shall the provisions of Sections 6.1 and 6.2 limit the
damages recoverable by either party against the other party due to the other
party's obligation to indemnify such party in accordance with this Agreement.
ARTICLE VII
RISK OF LOSS
Section 7.1 Minor Damage. In the event of loss or damage to the Real
Property or any portion thereof through casualty or condemnation which is not
"Major" (as defined in Section 7.3 hereof), this Agreement shall remain in full
force and effect provided that Seller shall, at Seller's option, either (a)
perform any necessary repairs (and pay to Purchaser at Closing any portion of
the insurance proceeds or condemnation award, less costs of collection, relating
thereto and not used for said repairs), or (b) assign to Purchaser all of
Seller's right, title and interest in and to any claims and proceeds Seller may
have with respect to any casualty insurance policies or condemnation awards
relating to the premises in question. In the event that Seller elects to perform
repairs upon the Real Property, Seller shall use reasonable efforts to complete
such repairs promptly and the date of Closing shall be extended a reasonable
time in order to allow for the completion of such repairs. If Seller elects to
assign a casualty claim or condemnation award to Purchaser (rather than perform
the necessary repairs), the Purchase Price shall be reduced, for casualty claims
only, by an amount equal to the lesser of the deductible amount under Seller's
insurance policy or the cost of such repairs as determined in accordance with
Section 7.3 hereof. Seller shall maintain its property insurance policy relating
to the Improvements (which Seller represents is an "all-risk" replacement cost
policy) in full force and effect up to the date of the Closing, and upon
Closing, full risk of loss with respect to the Real Property shall pass to
Purchaser.
Section 7.2 Major Damage. In the event of a "Major" loss or damage,
Purchaser may terminate this Agreement by written notice to Seller, in which
event the Deposit shall be returned to Purchaser. If Purchaser does not elect to
terminate this Agreement within ten (10) days after Seller gives Purchaser
written notice of the occurrence of such Major loss or damage (which notice
shall state the cost of repair or restoration thereof as opined by an architect
in accordance with Section 7.3 hereof), then Purchaser shall be deemed to have
elected to proceed with Closing, in which event: (i) Seller shall, at Seller's
option, either (a) perform any necessary repairs (and
30
pay to Purchaser at Closing any portion of the insurance proceeds or
condemnation award, less costs of collection, relating thereto and not used for
said repairs), or (b) assign to Purchaser all of Seller's right, title and
interest in and to any claims and proceeds Seller may have with respect to any
casualty insurance policies or condemnation awards relating to the premises in
question, provided, however, that any insurance proceeds or condemnation award
in excess of the Purchase Price shall be payable to Seller. In the event that
Seller elects to perform repairs upon the Real Property, Seller shall use
reasonable efforts to complete such repairs promptly and the date of Closing
shall be extended a reasonable time in order to allow for the completion of such
repairs. If Seller elects to assign a casualty claim or condemnation award to
Purchaser (rather than perform the necessary repairs), the Purchase Price shall
be reduced, for casualty claims only, by an amount equal to the lesser of the
deductible amount under Seller's insurance policy or the cost of such repairs as
determined in accordance with Section 7.3 hereof. Seller shall maintain its
property insurance policy relating to the Improvements in full force and effect
up to the date of the Closing, and upon Closing, full risk of loss with respect
to the Real Property shall pass to Purchaser.
Section 7.3 Definition of "Major" Loss or Damage. For purposes of Sections
7.1 and 7.2, "Major" loss or damage refers to the following: (a) loss or damage
to the Real Property hereof such that the cost of repairing or restoring the
premises in question to substantially the same condition which existed prior to
the event of damage would be, in the opinion of an architect selected by Seller
and reasonably approved by Purchaser, equal to or greater than Two Million Five
Hundred Thousand Dollars ($2,500,000.00), and (b) any loss due to a condemnation
which permanently and materially impairs the current use of the Real Property.
If Purchaser does not give written notice to Seller of Purchaser's reasons for
disapproving an architect within five (5) business days after receipt of notice
of the proposed architect, Purchaser shall be deemed to have approved the
architect selected by Seller.
Section 7.4 Section 5-1311 of the New York General Obligation Law. The
terms of this Article VII shall be deemed to be the terms of an agreement which
"expressly provides otherwise" within the meaning of Section 5-1311 of the New
York General Obligation Law. Seller and Purchaser agree that the terms and
conditions of this Article VII shall be subject to the terms and conditions of
the Korein Ground Lease and the LIRR Ground Lease; provided, however, that if
under the Korein Ground Lease or the LIRR Ground Lease, casualty proceeds or
condemnation awards are not available to be transferred to Purchaser as provided
in this Article 7, Purchaser shall not be obligated to accept an assignment of
such casualty proceeds or condemnation awards under
31
this Article 7 and may, if the conditions thereto are otherwise applicable under
this Article 7, elect instead to terminate this Agreement in accordance with the
terms of this Article 7.
ARTICLE VIII
COMMISSIONS
Section 8.1 Brokerage Commissions. Each party hereto agrees that if any
person or entity makes a claim for brokerage commissions or finder's fees
related to the sale of the Property by Seller to Purchaser, and such claim is
made by, through or on account of any acts or alleged acts of said party or its
representatives, said party will protect, indemnify, defend and hold the other
party free and harmless from and against any and all loss, liability, cost,
damage and expense (including reasonable attorneys' fees) in connection
therewith. The provisions of this paragraph shall survive Closing or any
termination of this Agreement.
ARTICLE IX
DISCLAIMERS AND WAIVERS
Section 9.1 No Reliance on Documents. Except as expressly stated herein,
Seller makes no representation or warranty as to the truth, accuracy or
completeness of any materials, data or information delivered by Seller or its
agents to Purchaser in connection with the transaction contemplated hereby.
Purchaser acknowledges and agrees that all materials, data and information
delivered by Seller to Purchaser in connection with the transaction contemplated
hereby are provided to Purchaser as a convenience only and that any reliance on
or use of such materials, data or information by Purchaser shall be at the sole
risk of Purchaser, except as otherwise expressly stated herein. Neither Seller,
nor any affiliate of Seller, nor the person or entity which prepared any report
or reports delivered by Seller to Purchaser shall have any liability to
Purchaser for any inaccuracy in or omission from any such reports.
32
SECTION 9.2 AS-IS SALE; DISCLAIMERSSECTION 9.2AS-IS SALE; DISCLAIMERS. EXCEPT AS
EXPRESSLY SET FORTH IN THIS AGREEMENT, IT IS UNDERSTOOD AND AGREED THAT SELLER
IS NOT MAKING AND HAS NOT AT ANY TIME MADE ANY WARRANTIES OR REPRESENTATIONS OF
ANY KIND OR CHARACTER, EXPRESS OR IMPLIED, WITH RESPECT TO THE PROPERTY,
INCLUDING, BUT NOT LIMITED TO, ANY WARRANTIES OR REPRESENTATIONS AS TO
HABITABILITY, MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
PURCHASER ACKNOWLEDGES AND AGREES THAT UPON CLOSING SELLER SHALL SELL AND
CONVEY TO PURCHASER AND PURCHASER SHALL ACCEPT THE PROPERTY "AS IS, WHERE IS,
WITH ALL FAULTS", AS OF THE PURCHASER EXECUTION DATE, SUBJECT TO REASONABLE
WEAR, TEAR AND NATURAL DETERIORATION DURING THE PERIOD FROM THE PURCHASER
EXECUTION DATE TO THE CLOSING DATE, AND EXCEPT TO THE EXTENT EXPRESSLY PROVIDED
OTHERWISE IN THIS AGREEMENT. PURCHASER HAS NOT RELIED AND WILL NOT RELY ON, AND
SELLER IS NOT LIABLE FOR OR BOUND BY, ANY EXPRESS OR IMPLIED WARRANTIES,
GUARANTIES, STATEMENTS, REPRESENTATIONS OR INFORMATION PERTAINING TO THE
PROPERTY OR RELATING THERETO (INCLUDING SPECIFICALLY, WITHOUT LIMITATION,
OFFERING PACKAGES DISTRIBUTED WITH RESPECT TO THE PROPERTY) MADE OR FURNISHED BY
SELLER, THE MANAGERS OF THE PROPERTY, OR ANY REAL ESTATE BROKER OR AGENT
REPRESENTING OR PURPORTING TO REPRESENT SELLER, TO WHOMEVER MADE OR GIVEN,
DIRECTLY OR INDIRECTLY, ORALLY OR IN WRITING, UNLESS SPECIFICALLY SET FORTH IN
THIS AGREEMENT. PURCHASER ALSO ACKNOWLEDGES THAT THE PURCHASE PRICE REFLECTS AND
TAKES INTO ACCOUNT THAT THE PROPERTY IS BEING SOLD "AS-IS" AS OF THE PURCHASER
EXECUTION DATE, SUBJECT TO REASONABLE WEAR, TEAR AND NATURAL DETERIORATION
DURING THE PERIOD FROM THE PURCHASER EXECUTION DATE TO THE CLOSING DATE.
PURCHASER REPRESENTS TO SELLER THAT PURCHASER HAS PRIOR TO THE PURCHASER
EXECUTION DATE CONDUCTED SUCH INVESTIGATIONS OF THE PROPERTY, INCLUDING BUT NOT
LIMITED TO, THE PHYSICAL AND ENVIRONMENTAL CONDITIONS THEREOF, AS PURCHASER HAS
DEEMED NECESSARY OR DESIRABLE TO SATISFY ITSELF AS TO THE CONDITION OF THE
PROPERTY AND THE EXISTENCE OR NONEXISTENCE OR CURATIVE ACTION TO BE TAKEN WITH
RESPECT TO ANY HAZARDOUS OR TOXIC SUBSTANCES ON OR DISCHARGED FROM THE PROPERTY,
AND WILL RELY SOLELY UPON SAME AND NOT UPON ANY INFORMATION PROVIDED BY OR ON
BEHALF OF SELLER OR ITS AGENTS OR EMPLOYEES WITH RESPECT THERETO, OTHER THAN
SUCH REPRESENTATIONS, WARRANTIES AND COVENANTS OF SELLER AS ARE EXPRESSLY SET
FORTH IN THIS AGREEMENT. UPON CLOSING, PURCHASER SHALL ASSUME THE RISK THAT
ADVERSE MATTERS, INCLUDING BUT NOT LIMITED TO, CONSTRUCTION DEFECTS AND ADVERSE
PHYSICAL AND ENVIRONMENTAL CONDITIONS, MAY NOT HAVE BEEN REVEALED BY PURCHASER'S
INVESTIGATIONS, AND PURCHASER, UPON CLOSING, SHALL BE DEEMED TO HAVE WAIVED,
RELINQUISHED AND RELEASED SELLER (AND SELLER'S OFFICERS, DIRECTORS,
SHAREHOLDERS, EMPLOYEES AND AGENTS) FROM AND AGAINST ANY AND ALL CLAIMS,
DEMANDS, CAUSES OF ACTION (INCLUDING CAUSES OF ACTION IN TORT), LOSSES, DAMAGES,
LIABILITIES, COSTS AND EXPENSES (INCLUDING REASONABLE ATTORNEYS'
33
FEES) OF ANY AND EVERY KIND OR CHARACTER, KNOWN OR UNKNOWN, WHICH PURCHASER
MIGHT HAVE ASSERTED OR ALLEGED AGAINST SELLER (AND SELLER'S OFFICERS, DIRECTORS,
SHAREHOLDERS, EMPLOYEES AND AGENTS) AT ANY TIME BY REASON OF OR ARISING OUT OF
ANY LATENT OR PATENT CONSTRUCTION DEFECTS OR PHYSICAL CONDITIONS, VIOLATIONS OF
ANY APPLICABLE LAWS AND ANY AND ALL OTHER ACTS, OMISSIONS, EVENTS, CIRCUMSTANCES
OR MATTERS REGARDING THE PROPERTY, EXCEPT TO THE EXTENT OTHERWISE EXPRESSLY SET
FORTH HEREIN.
Section 9.3 Survival of Disclaimers. The provisions of this Article IX
shall survive Closing or any termination of this Agreement.
ARTICLE X
MISCELLANEOUS
Section 10.1 Confidentiality. Purchaser and its representatives shall hold
in strictest confidence all data and information obtained with respect to Seller
or its business, whether obtained before or after the execution and delivery of
this Agreement, and shall not disclose the same to others; provided, however,
that it is understood and agreed that Purchaser may disclose such data and
information: (i) to the employees, lenders, consultants, accountants and
attorneys of Purchaser provided that such persons agree in writing to treat such
data and information confidentially; and (ii) if it becomes legally compelled
(by oral questions, interrogatories, requests for information or document
subpoena, civil investigation, demand or similar process) to disclose the same,
so long as Purchaser in such event furnishes Seller with prompt written notice
thereof so that Seller may seek a protective order or other appropriate
agreement with respect to such disclosure (in each case, at the sole cost and
expense of Seller). In the event this Agreement is terminated or Purchaser fails
to perform to the extent required hereunder (and the Closing does not occur),
Purchaser shall promptly return to Seller any statements, documents, schedules,
exhibits or other written information obtained from Seller in connection with
this Agreement or the transaction contemplated herein. In the event of a breach
or threatened breach by Purchaser or its agents or representatives of this
Section 10.1, Seller shall be entitled to an injunction restraining Purchaser or
its agents or representatives from disclosing, in whole or in part, such
confidential information. Nothing herein shall be construed as prohibiting
Seller from pursuing any other available remedy at law or in equity for such
breach or threatened breach. The provisions of this Section 10.1 shall survive
Closing or any termination of this Agreement. Notwithstanding anything in this
Section 10.1 to the contrary, Purchaser shall not be precluded from making
public statements or disclosures regarding the Property after the Closing.
34
Section 10.2 Public Disclosure. Prior to and after the Closing, any press
release or other public announcement of information to the public with respect
to the sale contemplated herein or any matters set forth in this Agreement will
be made only in the form approved by Purchaser and Seller (each acting
reasonably). In addition, Purchaser may make such public disclosure if required
in order for Purchaser to comply with the requirements of the New York Stock
Exchange, the Securities And Exchange Commission and other similar regulatory
agencies or bodies. The provisions of this Section 10.2 shall survive the
Closing or any termination of this Agreement.
Section 10.3 Assignment. Subject to the provisions of this Section 10.3,
the terms and provisions of this Agreement are to apply to and bind the
permitted successors and assigns of the parties hereto. Purchaser may not assign
its rights under this Agreement without first obtaining Seller's written
approval, which approval may be given or withheld in Seller's sole discretion.
In the event Purchaser intends to assign its rights hereunder, (a) Purchaser
shall send Seller written notice of its request at least ten (10) business days
prior to Closing, which request shall include the legal name and structure of
the proposed assignee, as well as any other information that Seller may
reasonably request, and (b) Purchaser and the proposed assignee shall execute an
assignment and assumption of this Agreement in form and substance satisfactory
to Seller, and (c) in no event shall any assignment of this Agreement release or
discharge Purchaser from any liability or obligation hereunder. Notwithstanding
the foregoing, under no circumstances shall Purchaser have the right to assign
this Agreement to any person or entity owned or controlled by an employee
benefit plan if Seller's sale of the Property to such person or entity would, in
the reasonable opinion of Seller's ERISA advisor, create or otherwise cause a
"prohibited transaction" under ERISA. Any transfer, directly or indirectly, of
any stock, partnership interest or other ownership interest in Purchaser shall
constitute an assignment of this Agreement.
Section 10.4 Notices. Any notice pursuant to this Agreement shall be given
in writing by (a) personal delivery (against a signed receipt by the named
individual addressee), (b) reputable overnight delivery service with proof of
delivery, or (c) United States Mail, postage prepaid, registered or certified
mail, return receipt requested, sent to the intended addressee at the address
set forth below, or to such other address or to the attention of such other
person as the addressee shall have designated by written notice sent in
accordance herewith, and shall be deemed to have been given upon receipt or
refusal to accept delivery. Unless changed in accordance with the preceding
sentence, the addresses for notices given pursuant to this Agreement shall be as
follows:
35
If to Seller: Mid-City Associates
c\o Metropolitan Life Insurance Company
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx, Vice President
with a copy to: Xxx. Xxxxx X. Helmsley
As Executrix of the Estate of Xxxxx X. Helmsley
and Individually
c\o Helmsley Enterprises, Inc.
000 Xxxx Xxxxxx, Xxxxx 000
Xxx Xxxx, XX 00000
with a copy to: Xxxxx X. Xxxxxx, Chairman
Xxxx & Xxxxxx, LLP
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
with a copy to: Metropolitan Life Insurance Company
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx X. Xxxxxxx,
Assistant General Counsel
If to Purchaser: One Penn Plaza LLC
c/o Vornado Realty Trust
Park 00 Xxxx, Xxxxx XX
Xxxxxx Xxxxx, Xxx Xxxxxx 00000
Attention: Xxxxxxx Xxxxxxxxxx
with a copy to: Proskauer Rose LLP
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxx X. Xxxxxx, Esq.
Section 10.5 Modifications. This Agreement cannot be changed orally, and
no executory agreement shall be effective to waive, change, modify or discharge
it in whole or in part unless such executory agreement is in writing and is
signed by the parties against whom enforcement of any waiver, change,
modification or discharge is sought.
Section 10.6 Entire Agreement. This Agreement, including the exhibits and
schedules hereto, contains the entire agreement between the parties hereto
pertaining to the subject matter hereof and fully supersedes all prior written
or oral agreements and understandings between the parties pertaining to such
subject matter, other than any confidentiality agreement executed by Purchaser
in connection with the Property.
Section 10.7 Further Assurances. Each party agrees that it will execute
and deliver such other documents and take such
36
other action, whether prior or subsequent to Closing, as may be reasonably
requested by the other party to consummate the transaction contemplated by this
Agreement. The provisions of this Section 10.7 shall survive Closing.
Section 10.8 Counterparts. This Agreement may be executed in counterparts,
all such executed counterparts shall constitute the same agreement, and the
signature of any party to any counterpart shall be deemed a signature to, and
may be appended to, any other counterpart.
Section 10.9 Facsimile Signatures. In order to expedite the transaction
contemplated herein, telecopied signatures may be used in place of original
signatures on this Agreement. Seller and Purchaser intend to be bound by the
signatures on the telecopied document, are aware that the other party will rely
on the telecopied signatures, and hereby waive any defenses to the enforcement
of the terms of this Agreement based on the form of signature.
Section 10.10 Severability. If any provision of this Agreement is
determined by a court of competent jurisdiction to be invalid or unenforceable,
the remainder of this Agreement shall nonetheless remain in full force and
effect; provided that the invalidity or unenforceability of such provision does
not materially adversely affect the benefits accruing to any party hereunder.
Section 10.11 Applicable Law. This Agreement shall be governed by and
construed in accordance with the laws of the State in which the Real Property is
located. Purchaser and Seller agree that the provisions of this Section 10.11
shall survive the Closing or any termination of this Agreement.
Section 10.12 No Third-Party Beneficiary. The provisions of this Agreement
and of the documents to be executed and delivered at Closing are and will be for
the benefit of Seller and Purchaser only and are not for the benefit of any
third party, and accordingly, no third party shall have the right to enforce the
provisions of this Agreement or of the documents to be executed and delivered at
Closing.
Section 10.13 Captions. The section headings appearing in this Agreement
are for convenience of reference only and are not intended, to any extent and
for any purpose, to limit or define the text of any section or any subsection
hereof.
Section 10.14 Construction. The parties acknowledge that the parties 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
37
party shall not be employed in the interpretation of this Agreement or any
exhibits or amendments hereto.
Section 10.15 Recordation. This Agreement may not be recorded by any party
hereto without the prior written consent of the other party hereto. The
provisions of this Section 10.15 shall survive the Closing or any termination of
this Agreement.
38
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
as of the Effective Date.
SELLER:
MID-CITY ASSOCIATES,
a New York partnership
By: ______________________________
XXXXX X. XXXXXX,
General Partner
By: _____________________________
XXXXX M HELMSLEY, as Executrix of the Estate of Xxxxx X. Helmsley and
Individually, and on behalf of HBH Holdings Corp. (the successor in
interest to Helmsley-Spear, Inc. under the Seller's Partnership
Agreement) pursuant to Section 12.02 of the Seller's Partnership
Agreement, General Partner
By: METROPOLITAN LIFE INSURANCE COMPANY,
General Partner
By: ______________________________
Name: XXXXXX X. XXXXXX
Title: Vice-President
Effective Date: __________________
(signatures continued on next page)
39
PURCHASER:
ONE PENN PLAZA LLC,
a New York limited liability company
By: VORNADO REALTY L.P.,
Managing Member
By: VORNADO REALTY TRUST,
General Partner
By: _________________________
Name: _______________________
Title: ______________________
Purchaser Execution Date: November , 1997
