EXHIBIT 10.13
AGREEMENT FOR THE PURCHASE AND SALE OF PROPERTY
BETWEEN THE FREMONT JOINT VENTURE
AND
ROSE VENTURES V. INC., XXXXXX X. XXXXX AND XXXXXXX X. XXXXX
AGREEMENT FOR THE PURCHASE AND SALE OF PROPERTY
THIS AGREEMENT FOR THE PURCHASE AND SALE OF PROPERTY (the "Agreement"), is
made and entered into as of the 8th day of June, 1998, by and between ROSE
VENTURES V, INC., a California Corporation as to an undivided 50% interest, and
XXXXXX X. XXXXX and XXXXXXX X. XXXXX, husband and wife, as joint tenants as to
undivided 50% interest (hereinafter referred to as "Seller"), and XXXXX
DEVELOPMENT CORPORATION, a Georgia Corporation (hereinafter referred to as
"Purchaser").
W I T N E S S E T H:
WHEREAS, Seller desires to sell and Purchaser desires to purchase the
Property (as hereinafter defined) subject to the terms and conditions
hereinafter set forth.
NOW, THEREFORE, for and in consideration of the premises, the mutual
agreements contained herein, the sum of Ten Dollars ($10.00) in hand paid by
Purchaser to Seller at and before the sealing and delivery of these presents and
for other good and valuable consideration, the receipt, adequacy, and
sufficiency which are hereby expressly acknowledged by the parties hereto, the
parties hereto do hereby covenant and agree as follows:
1. Purchase and Sale of Property. Subject to and in accordance with the
terms and provisions of this Agreement, Seller hereby agrees to sell to
Purchaser and Purchaser hereby agrees to purchase from Seller, the Property,
which term "Property" shall mean and include the following:
(a) all that tract or parcel of land located in Fremont, Alameda
County, California, and being more particularly described on Exhibit "A"
attached hereto and by this reference made a part hereof (herein referred
to as the "Land"); and
(b) all of Seller's rights, privileges, and easements appurtenant to
the Land, and all of Seller's water rights, mineral rights, reversions, or
other appurtenances to said Land, and all right, title, and interest of
Seller, if any, in and to any land lying in the bed of any street, road,
alley, or right-of-way, open or proposed, adjacent to or abutting the
Land; and
(c) all buildings, structures, and improvements situated on the
Land, including, without limitation, that certain two story office
building containing approximately 58,424 rentable square feet of space,
the parking areas containing approximately 190 parking spaces and other
amenities constructed on the Land, and all apparatus, built-in appliances,
equipment, pumps, machinery, plumbing, heating, air conditioning,
elevators, electrical and other fixtures located on or to be located on
the Land (all of which are herein collectively referred to as the
"Improvements"); and
(d) all personal property located on or to be located on or in, or
used in connection with, the Land and Improvements, (all of which are
herein collectively referred to as the "Personal Property"); and
(e) all of Seller's right, title, and interest, as landlord or
lessor, in and to the Lease (as hereinafter defined); and
(f) all of Seller's right, title, and interest, if any, in and to
the plans and specifications with respect to the Improvements and any
guarantees, trademarks, rights of copyright, warranties, or other rights
related to the ownership of or use and operation of the Land, Personal
Property, or Improvements, all governmental licenses and permits, and all
intangibles associated with the Land, Personal Property, and Improvements,
including the name of the Improvements and the logo therefor, if any.
2. Xxxxxxx Money. Within two (2) business days after the Effective Date,
Purchaser shall deliver to First American Title Guaranty Company ("Escrow
Agent"), whose offices are at 0000 Xxxxx Xxxxx Xxxxxx, Xxx Xxxx, Xxxxxxxxxx
00000, Purchaser's check, payable to Escrow Agent, in the amount of $100,000
(the "Xxxxxxx
Money"), which Xxxxxxx Money shall be held and disbursed by Escrow Agent
pursuant to this Agreement. The Xxxxxxx Money shall be paid by Escrow Agent to
Seller at Closing (as hereinafter defined) and shall be applied as a credit to
the Purchase Price (as hereinafter defined), or shall otherwise be paid to
Seller or refunded to Purchaser in accordance with the terms of this Agreement.
All interest and other income from time to time earned on the Xxxxxxx Money
shall belong to Purchaser and shall be disbursed to Purchaser at any time and
from time to time as Purchaser shall direct Escrow Agent, all as provided in the
Escrow Agreement. In no event shall any such interest or other income be deemed
a part of the Xxxxxxx Money.
3. Purchase Price. Subject to adjustment and credits as otherwise
specified in this Agreement, the purchase price (the "Purchase Price") to be
paid by Purchaser to Seller for the Property shall be EIGHT MILLION NINE HUNDRED
THOUSAND Dollars ($8,900,000). The Purchase Price shall be paid by wire transfer
of immediately available federal funds, less the amount of Xxxxxxx Money and
subject to prorations, adjustments and credits as otherwise specified in this
Agreement.
4. Purchaser's Inspection and Review Rights. Commencing on the Effective
Date and ending on the Closing Date, and subject to the rights of the Tenant (as
hereinafter defined), Purchaser and its agents, engineers, or representatives,
with Seller's reasonable, good faith cooperation, shall have the privilege of
going upon the Property as needed to inspect, examine, test, and survey the
Property at all reasonable times and from time to time. Such privilege shall
include the right to make tests, borings, and other tests to obtain information
necessary to determine surface and subsurface conditions, provided, however,
that no borings shall be made without the advance written consent of Seller.
Seller in its sole and absolute discretion, shall have the right to approve all
consultants conducting any tests as well as the scope of any invasive testing on
the Property prior to the Purchaser conducting such testing. Such privilege
shall also include the right to make any other tests deemed reasonably necessary
by Purchaser. Purchaser hereby agrees to indemnify and hold Seller harmless from
any liens, claims, liabilities, expenses and damages, including, without
limitation, reasonable attorney's fees, incurred through the exercise of such
privilege, and Purchaser further agrees to repair any damage to the Property
caused by the exercise of such privilege. At all reasonable times prior to the
Closing (as hereinafter defined), Seller shall make available to Purchaser, or
Purchaser's agents and representatives, and for copying at Purchaser's expense,
all books, records, and files in Seller's possession relating to the ownership
and operation of the Property, including, without limitation, title matters,
surveys, tenant files, service and maintenance agreements, and other contracts,
books, records, operating statements, and other information relating to the
Property. Seller further agrees to in good faith assist and cooperate with
Purchaser, at no cost to Seller, in coming to a thorough understanding of the
books, records, and files relating to the Property. Seller further agrees to
provide copies of any of such books, records, and files as may be reasonably
requested by Purchaser, with the copying costs to be borne by Purchaser. Seller
further agrees to provide to Purchaser prior to the date which is five (5)
business days after the Effective Date the most current surveys, appraisals,
environmental and engineering reports of the Land and Improvements which are in
the possession of Seller or which Seller can obtain with a reasonable effort and
which have not been previously delivered to Purchaser. Seller further agrees to
provide to Purchaser prior to the date which is five (5) days after the
Effective Date, a statement setting forth all revenues from the Property and
setting forth all costs and expenses of operating, maintaining, and repairing
the Property (and the costs of replacing component parts thereof) incurred by
Seller, in each case during the period of its ownership. The provisions of this
paragraph 4 shall survive the Closing or any termination of this Agreement.
5. Special Condition to Closing. Subject to the limitations set forth in
paragraph 4 above, Purchaser shall have until June 24, 1998 to make
investigations, examinations, inspections, market studies, feasibility studies,
lease reviews, and tests relating to the Property and the operation thereof in
order to determine, in Purchaser's sole opinion and discretion, the suitability
of the Property for acquisition by Purchaser. Purchaser shall have the right to
terminate this Agreement at any time prior to the expiration of the Inspection
Period by giving written notice to Seller of such election to terminate. In the
event this Agreement is so terminated, Seller shall be entitled to receive the
sum of One Hundred Dollars ($100) of the Xxxxxxx Money, and the balance of the
Xxxxxxx Money shall be promptly refunded by Escrow Agent to Purchaser,
whereupon, except as expressly provided to the contrary in this Agreement,
Purchaser shall have no further right to purchase the Property and no party
hereto shall have any other or further rights or obligations under this
Agreement. Seller acknowledges that the sum of $100 is good and adequate
consideration for the termination rights granted to Purchaser hereunder. In
the event Purchaser fails to notify Seller on or before June 24, 1998 that
Purchaser has elected to terminate this Agreement, then Purchaser's right to
terminate this Agreement pursuant to the provisions of paragraphs 5, 6(g) and
6(h) shall be deemed to have been waived. Thereafter, if Seller has complied
with all the terms and conditions of this Agreement, and Purchaser fails or
refuses to close on or before June 26, 1998 (or July 7, 1998, if the closing
date is extended as provided herein), then the Xxxxxxx Money shall be released
to Seller, and Purchaser shall have no further liability hereunder.
6. General Conditions Precedent to Purchaser's Obligations Regarding the
Closing. In addition to any other conditions to Purchaser's obligations
hereunder, the obligations and liabilities of Purchaser hereunder shall in all
respects be conditioned upon the satisfaction of each of the following
conditions prior to or simultaneously with the Closing (as hereinafter defined),
any of which may be waived by written notice from Purchaser to Seller:
(a) Seller shall have complied in all material respects with and
otherwise performed in all material respects each of the covenants and
obligations of Seller set forth in this Agreement.
(b) All representations and warranties of Seller as set forth in
this Agreement shall be true and correct in all material respects as of
the date of Closing.
(c) There shall have been no material adverse change to the title to
the Property which has not been cured and the Title Company (as
hereinafter defined) shall have issued the Title Report (as hereinafter
defined) on the Land and Improvements without exceptions other than as
have been approved by Purchaser as Permitted Exceptions (as hereinafter
defined) and the Title Company shall be prepared to issue to Purchaser
upon the Closing an ALTA Owner's Title Insurance Policy on the Land and
Improvements pursuant to such Title Report.
(d) Purchaser shall have received the Tenant Estoppel Certificate
referred to in Paragraph 9(c) hereof, duly executed by the Tenant (as
hereinafter defined).
(e) Purchaser shall have received a date-down on the Title Report
through the date and time of recording the Grant Deed from Seller to
Purchaser, to reflect that Purchaser is vested with the fee simple title
to the Land and the Improvements, and to reflect that all requirements for
the issuance of the final title policy pursuant to such Title Commitment
have been satisfied.
(f) Seller shall use reasonable efforts to cause the entities which
issued to Seller the environmental site assessment report, the appraisal
and the building inspection report to address their respective reports to
Purchaser in such a way that Purchaser shall be entitled to rely on same.
(g) Purchaser's obligations and liabilities hereunder shall be
conditioned upon Purchaser receiving, at Purchaser's sole cost and
expense, prior to the Closing, an appraisal of the Land and Improvements
(as encumbered by the Lease) from a competent independent appraiser
selected by Purchaser which shall state that the Land and Improvements
have a value equal to or exceeding the Purchase Price. If the appraisal
received by the Purchaser shall reflect a value of the Land and
Improvements which is less than the Purchase Price, Purchaser shall have
the right to terminate this Agreement prior to June 24, 1998 by giving
written notice to Seller of such election to terminate. In the event
Purchaser so elects to terminate this Agreement, Seller shall be entitled
to receive $100 of the Xxxxxxx Money from Escrow Agent, and Purchaser
shall be entitled to a return of the balance of the Xxxxxxx Money, if any,
from Escrow Agent, Purchaser shall have no further right to acquire the
Property, and no party hereto shall have any other or future rights or
obligations under this Agreement, except as expressly provided to the
contrary herein.
(h) Purchaser shall have received a commitment from a licensed
commercial lending institution to make a loan to Purchaser in the amount
of not less than $6,800,000, bearing an interest rate not in excess of
9.25% per annum, being amortized over a period of 30 years, a maturity
date of 3 years,
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closing costs not to exceed $10,000; an origination fee and other costs
not to exceed 1% of the loan amount and permitting prepayment in six
months. Purchaser shall pay any costs incurred in connection with the
closing of such a loan. This contingency to be removed on or before June
24, 1998.
7. Title and Survey. Seller covenants and agrees that Seller, at its sole
cost and expense, shall, on or before seven (7) days after the Effective Date of
this Agreement cause First American Title Guaranty Company, or such other such
title insurance company acceptable to Purchaser (herein referred to as the
"Title Company"), to deliver to Purchaser its Preliminary Title Report (herein
referred to as the "Title Report") to issue to Purchaser, upon the recording of
the Grant Deed conveying title to the Property from Seller to Purchaser, the
payment of the Purchase Price, and the payment to the Title Company of the
policy premium therefor, an ALTA Owner's Policy of Title Insurance with
endorsements covering survey and zoning, in the amount of the Purchase Price,
insuring good and marketable fee simple record title to the Property to be in
Purchaser without exception (including any general exception) except for matters
approved by Purchaser (herein referred to as the ("Permitted Exceptions"). The
Title Policy to be issued shall not contain any exception for mechanic's or
materialman's liens or any exception for unpaid taxes other than an exception
for taxes not yet due and payable. Such Title Policy shall not contain any
exception for rights of parties in possession other than an exception for the
rights of the Tenant (as hereinafter defined) under the Lease. If the Title
Report shall contain an exception for the state of facts which would be
disclosed by a survey of the Property or an "area and boundaries" exception, the
Title Report shall provide that such exception will be deleted upon the
presentation of an "as-built" survey, in which case the Title Report shall be
amended to contain an exception only for the matters shown on the as-built
survey. Seller shall also cause to be delivered to Purchaser together with such
Title Report, legible copies of all documents and instruments referred to
therein. Purchaser shall have until June 15, 1998 or five days after receipt of
the Title Report and accompanying documents, whichever is later to notify
Seller, in writing, of Purchaser's objection to any exceptions contained in the
Title Report and/or any other rights, interests or matters not shown of record
but which are discovered by Purchaser as a result of a survey, inspection or
inquiry (hereinafter referred to as "Title Defects"). Upon receipt of such
notification, Seller shall have five (5) days within which to notify Purchaser,
in writing, whether Seller intends to remove or delete from the title to be
conveyed to Purchaser any Title Defects objected to by Purchaser provided that
Seller shall cure any mortgage, deed of trust or other lien voluntarily created
by Seller. If Seller so elects to cure such Title Defects, then Seller shall
exercise diligent efforts, at no cost to Purchaser, to remove the same prior to
the Closing. If Seller does not elect or is unable to cure such Title Defects,
Seller shall notify Purchaser thereof in writing within said five (5) day
period, and Purchaser may elect within five (5) calendar days of receipt of
Seller's notice (but in no event later than June 24, 1998) to either (i) waive
its objections and proceed with the purchase of the Property (without any
reduction in the Purchase Price) pursuant to the terms of this Agreement (in
which event such Title Defect shall be deemed a "Permitted Exception" as stated
above), or (ii) terminate this Agreement, in which event Purchaser and Seller
shall have no further right, obligations or liabilities hereunder (other than
those that expressly survive termination of this Agreement) and Purchaser shall
be entitled to the prompt return of the Xxxxxxx Money and all interest accrued
thereon while in escrow. If Purchaser fails to make such election within five
(5) calendar day period, then Purchaser shall be deemed to have elected to
terminate this Agreement as provided above. For purposes of this Agreement, the
term "Permitted Exceptions" shall mean those title exceptions applicable to the
Property, which are accepted by Purchaser in accordance with the terms of this
Section 7). If Seller fails to remove such Title Defect as of the Closing, then,
to the extent such Title Defect is a mortgage, deed of trust or other lien
voluntarily created by Seller, Purchaser may use the applicable portion of the
Purchase Price at Closing to pay off and discharge such mortgage, deed of trust
or other lien voluntarily created by Seller; or (i) Purchaser shall have the
right to terminate this Agreement by giving written notice of such termination
to Seller, whereupon Escrow Agent shall promptly refund all Xxxxxxx Money to
Purchaser, Purchaser shall have no further right to purchase the Property and
Purchaser and Seller shall have no further rights, obligations, or liabilities
hereunder, except as may be expressly provided to the contrary herein; or (ii)
Purchaser shall have the right to accept title to the Property subject to such
defects and objections with no reduction in the Purchase Price, in which event
such defects and objections shall be deemed "Permitted Exceptions" above. Except
as expressly provided to the contrary herein, Seller makes no warranty of any
kind with respect to the title of the Property and Purchaser agrees to look
solely to the remedies afforded by Purchaser's title insurance policy with
regard to the condition of title.
8. Representations and Warranties of Seller. Seller hereby makes the
following representations and warranties to Purchaser:
(a) Lease. Attached hereto as Exhibit "B" and by this reference made
a part hereof as a true and correct copy of the lease with Xxxxxxxxx
Technologies USA, Inc. ("Tenant") dated September 19, 1997, including the
guarantee of The Xxxxxxxxx Corporation together with all modifications and
amendments to such lease, the cover page of which is attached as Exhibit
"A" (such lease, as modified and amended, being herein referred to as the
"Lease"). Seller is the "landlord" under the Lease and the rents and other
income thereunder, subject only to the collateral assignment of the Lease
and the rents thereunder in favor of the holder of any existing mortgage
or deed of trust encumbering the Property, which mortgage or deed of trust
shall be canceled and satisfied by Seller at the Closing.
(b) Lease - Assignment. To Seller's knowledge, the Tenant has not
assigned its interest in the Lease or sublet any portion of its premises
under the Lease.
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(c) Lease - Default. (i) Seller has not received any notice of
termination or default under the Lease, (ii) to the Seller's knowledge
there are no existing or uncured defaults by Seller or by the Tenant under
the Lease, (iii) to the Seller's knowledge there are no events which with
the passage of time or notice, or both, would constitute a default by
Seller or by the Tenant, and Seller has complied with each and every
undertaking, covenant, and obligation of landlord under the Lease, except
that as of the date hereof approximately $197,000 remains to be disbursed
to Tenant in order to satisfy Seller's contribution for tenant
improvements, and to the extent Seller's contribution has not been fully
funded at Closing, the unfunded portion shall be withheld from Seller's
proceeds at Closing and applied by Purchaser to satisfy Seller's
obligations under the Lease, and (iv) Seller has not received notice that
Tenant has asserted any defense, set-off, or counterclaim with respect to
its tenancy or its obligation to pay rent, additional rent, or other
charges under the Lease.
(d) Lease - Rents and Special Consideration. Tenant: (i) has not
prepaid rent for more than one month in advance under the Lease, (ii) is
not entitled to receive any rent concession in connection with its tenancy
under the Lease which has not already been received except as expressly
provided therein, (iii) is not entitled to any special work (not yet
performed), or consideration (not yet given) in connection with its
tenancy under the Lease; and (iv) does not have any deed, option, or other
evidence of any right or interest in or to the Property, except as
evidenced by the express terms of the Lease.
(e) Lease - Commissions. No rental, lease, or other commissions with
respect to the Lease is payable to Seller, any partner of Seller, any
party affiliated with or related to Seller or third party. All commissions
payable under, relating to, or as a result of the Lease has been
cashed-out and paid and satisfied in full by Seller or by Seller's
predecessor in title to the Property.
(f) Service Contracts. There are no service contracts with Seller
(as opposed to Tenant) which are in effect and which relate to the
operation, management, or maintenance the Property which will continue in
effect after Closing. Seller has canceled or will cancel, effective as of
the Closing, any agreement in the nature of a management agreement or
service contract between Seller and any partner or shareholder of Seller
or any party affiliated with or related to Seller or any partner or
shareholder of Seller.
(g) No Other Agreements. Other than the Lease and the Permitted
Exceptions, Seller has not entered into any leases, service contracts,
management agreements, or other agreements or instruments, to which Seller
is a party and that grant to any person whomsoever or any entity
whatsoever any right, title, interest or benefit in or to all or any part
of the Property or any rights relating to the use, operation, management,
maintenance, or repair of all or any part of the Property and which will
extend beyond the Closing.
(h) No Litigation. To Seller's knowledge, there are no actions,
suits, or proceedings pending, or, threatened by any organization, person,
individual, or governmental agency against Seller with respect to the
Property or against the Property, nor does Seller have any knowledge of
any basis for such action. Seller has no knowledge of any pending or
threatened application for changes in the zoning applicable to the
Property or any portion thereof.
(I) Condemnation. To Seller's knowledge no condemnation or other
taking by eminent domain of the Property or any portion thereof has been
instituted and, there are no pending or threatened condemnation or eminent
domain proceedings (or proceedings in the nature or in lieu thereof)
affecting the Property or any portion thereof or its use.
(j) Proceedings Affecting Access. The Property is served by a curb
cut for direct vehicular access to and from Auburn Street and Kato Road,
adjoining the Property, which is a public road. To Seller's knowledge,
there are no pending or threatened proceedings that could have the effect
of impairing or restricting access between the Property and such adjacent
public roads.
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(k) No Assessments. To Seller's knowledge, no assessments have been
made against the Property that are unpaid, whether or not they have become
liens, and there are no pending assessments, except as shown on the Title
Report.
(l) Violations. Seller has not received written notice of any
violations of law, municipal or county ordinances, or other legal
requirements with respect to the Property that remain uncured, nor any
notice that Improvements thereon do not comply with any legal requirements
with respect to the use, occupancy and construction thereof. To Seller's
knowledge, the Property is currently zoned in a classification such as
will permit the operation of the Property for the uses specified in the
Lease and the conditions, if any, to the granting of the zoning of the
Property have been satisfied. To Seller's knowledge, the Improvements
located on the Property are not located in a flood plain.
(m) Improvements. To Seller's knowledge, there are no structural or
other defects, latent or otherwise, in the Improvements, the heating,
ventilating, air conditioning, electrical, plumbing, water, roofing,
elevators (if any), storm drainage and sanitary sewer systems at or
servicing the Land and Improvements are in good condition and working
order and there are no defects or deficiencies, latent or otherwise,
therein.
(n) Employees. There are no employment, collective bargaining, or
similar agreements or arrangements between Seller and any of its employees
or others which will be binding on Purchaser or any of Purchaser's
successors in title.
(o) Bankruptcy. Seller is solvent and has not made a general
assignment for the benefit of creditors nor been adjudicated a bankrupt or
insolvent, nor has a receiver, liquidator, or trustee for any of Seller's
properties (including the Property) been appointed or a petition filed by
or to Seller's knowledge against Seller for bankruptcy, reorganization, or
arrangement pursuant to the Federal Bankruptcy Act or any similar Federal
or state statute, or any proceeding instituted for the dissolution or
liquidation of Seller.
(p) Pre-existing Right to Acquire. No person or entity has any right
or option to acquire the Property or any portion thereof which will have
any force or effect after the execution of this Agreement, other than
Purchaser, except as set forth in the Lease.
(q) Effect of Certification. Neither this Agreement nor the
transactions contemplated herein will constitute a breach or violation of,
or default under, or will be modified, restricted, or precluded by the
Leases, the Service Contracts, or the Permitted Exceptions.
(r) Authorization. ROSE VENTURES V, INC. is a duly organized and
validly existing corporation under the laws of the State of California and
has duly registered in any jurisdiction where it is required to do so.
This Agreement has been duly authorized and executed on behalf of Seller
and constitutes the valid and binding agreement of Seller, enforceable in
accordance with its terms, and all necessary action on the part of Seller
to authorize the transactions herein contemplated has been taken, and no
further action is necessary for such purpose.
(s) Seller Not a Foreign Person. Neither Seller nor the owner of
beneficial title to the Property is a "foreign person" which would subject
Purchaser to the withholding tax provisions of Section 1445 of the
Internal Revenue Code of 1986, as amended.
(t) Utilities. To Sellers knowledge all utilities necessary for the
use of the Property as an office building of the size and nature situated
thereon, including water, sanitary sewer, storm sewer, electricity, and
telephone, are installed and operational, and such utilities either enter
the Property through adjoining public streets, or, if they pass through
adjoining private land, do so in accordance with valid public easements or
private easements which inure to the benefit of the Property. All
installation and connection charges for utilities serving the Property
have been paid in full.
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(u) Tax Returns. All property tax returns required to be filed by
Seller relating to the Property under any law, ordinance rule, regulation,
order, or requirement of any governmental authority have been, or will be,
as the case may be, truthfully, correctly, and timely filed.
At Closing, Seller shall represent and warrant to Purchaser that all
representations and warranties of Seller in this Agreement remain true and
correct as of the date of the Closing, except for any changes in any such
representations or warranties that occur and are disclosed by Seller to
Purchaser expressly and in writing at any time and from time to time prior to
Closing, which disclosures shall thereafter be updated by Seller to the date of
Closing. If there is any change in any representations or warranties and Seller
does not cure or correct such changes prior to Closing, then Purchaser may, at
Purchaser's option, (i) close and consummate the transaction contemplated by
this Agreement, (ii) terminate this Agreement by written notice to Seller,
whereupon the Xxxxxxx Money shall be immediately returned by Escrow Agent to
Purchaser, Purchaser shall have no further right to purchase the Property and
thereafter the parties hereto shall have no further rights or obligations
hereunder, except only for such rights or obligations that, by the express terms
hereof, survive any termination of this Agreement, or (iii) exercise any other
remedy available to Purchaser at law or in equity.
9. Seller's Additional Covenants. Seller does hereby further covenant and
agree as follows:
(a) Operation of Property. Seller hereby covenants that, from the
date of this Agreement up to and including the date of Closing, Seller
shall: (i) not enter into a contract with any third party respecting the
sale of the Property or any interest therein unless such contract is by
its terms subordinate to this Agreement, (ii) not modify, amend, or
terminate the Lease or enter into any new lease, contract, or other
agreement respecting the Property, without the consent of Purchaser, which
consent shall not be withheld or delayed and (iii) not grant or otherwise
create or consent to the creation of any easement, restriction, lien,
assessment, or encumbrance respecting the Property.
(b) Preservation of Lease. Seller shall, from and after the date of
this Agreement to the date of Closing, use its best efforts to perform and
discharge all of the duties and obligations and shall otherwise comply
with every covenant and agreement of the landlord under the Lease, at
Seller's expense, in the manner and within the time limits required
thereunder. Furthermore, Seller shall, for the same period of time, use
diligent and good faith efforts to cause the Tenant under the Lease to
perform all of its duties and obligations and otherwise comply with each
and every one of its covenants and agreements under such Lease and shall
take such actions as are reasonably necessary to enforce the terms and
provisions of the Lease.
(c) Tenant Estoppel Certificate. Prior to June 24, 1998, Seller
shall obtain and deliver to Purchaser a fully completed estoppel
certificate with respect to the Lease (herein referred to as the "Tenant
Estoppel Certificate") duly executed by the Tenant thereunder in the form
attached hereto as Exhibit "C".
(d) Insurance. From and after the date of this Agreement to the date
and time of Closing, Seller shall, at its expense, continue to maintain
the insurance policies covering the Property which are currently in force
and effect.
(e) Securities Act Compliance. Seller acknowledges that Purchaser
may be required by the Securities and Exchange Commission to file audited
financial statements for one to three years with regard to the Property.
At no cost or liability to Seller, Seller shall (i) cooperate with
Purchaser, its counsel, accountants, agents, and representatives, provide
them with access to Seller's books and records with respect to the
ownership, management, maintenance, and operation of the Property for the
applicable period, and permit them to copy the same,(ii) execute a form of
"rep" letter in form and substance reasonably satisfactory to Seller, and
(iii) furnish Purchaser with such additional information concerning the
same as Purchaser shall reasonably request. Purchaser will pay the costs
associated with any such audit. The terms of this paragraph shall survive
Closing.
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10. Closing. Provided that all of the conditions set forth in this
Agreement are theretofore satisfied or performed in all material respects, it
being fully understood and agreed, however, that Purchaser may expressly waive
in writing, at or prior to Closing, any conditions that are unsatisfied or
unperformed at such time, the consummation of the sale by Seller and purchase by
Purchaser of the Property (herein referred to as the "Closing") shall be held on
or before June 26, 1998, and at such specific time, and date as shall be
designated by Purchaser in a written notice to Seller not less than two (2)
business days prior to Closing at the office of the Title Company, and absent
such notice at 2:00pm local time on June 26, 1998. For an additional $100,000.00
non-refundable deposit, close of escrow can be extended to July 7, 1998.
11. Seller's Closing Documents. For and in consideration of, and as a
condition precedent to, Purchaser's delivery to Seller of the Purchase Price
described in Paragraph 3 hereof, Seller shall obtain or execute, at Seller's
expense, and deliver to Purchaser at Closing the following documents (all of
which shall be duly executed, acknowledged, and notarized where required):
(a) Grant Deed. A Grant Deed ("Grant Deed") in the form attached
hereto as Exhibit "D" conveying to Purchaser fee simple title to the Land
and Improvements, together with all rights, members, easements, and
appurtenances thereto, subject only to the Permitted Exceptions. The legal
description set forth in the Grant Deed shall be as set forth on Exhibit
"A" attached hereto. In the event Purchaser shall obtain a new or updated
survey of the Land and Improvements and the legal description set forth in
Purchaser's survey shall differ from the legal description set forth on
Exhibit "A" hereto, Seller shall execute and deliver to Purchaser a
quitclaim deed containing a legal description based upon such survey
obtained by Purchaser;
(b) Xxxx of Sale. A Xxxx of Sale conveying to Purchaser marketable
title to the Personal Property in the form attached hereto as Exhibit "E";
(c) Blanket Transfer. A Blanket Transfer and Assignment in the form
attached hereto as Exhibit "F";
(d) Assignment and Assumption of Lease. An Assignment and Assumption
of Lease in the form attached hereto as Exhibit "G" assigning to Purchaser
all of Seller's right, title, and interest in and to the Lease and the
rents thereunder;
(e) ALTA Affidavit. A customary ALTA affidavit in the form required
by the Title Company;
(f) FIRPTA Certificate. A FIRPTA Certificate;
(g) Surveys and Plans. Such surveys, site plans, plans and
specifications, and other matters relating to the Property as are
described in subparagraph (a) of the Blanket Transfer and Assignment and
are in the possession of Seller or Seller's agents;
(h) Certificates of Occupancy. To the extent in Seller's possession,
the original certificates of occupancy for all space within the
Improvements;
(I) Lease. An original executed counterpart or certified copy of the
Lease and all amendments to and modifications thereof;
(j) Estoppel Certificate. The estoppel certificate referred to in
Paragraph 9(c) hereof;
(k) Keys and Records. All of the keys to any doors or locks on the
Property and the original tenant files and other books and records
relating to the Property in Seller's possession;
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(l) Tenant Notice. Notice from Seller to the Tenant of the sale of
the Property to Purchaser in such form as Purchaser shall reasonably
approve; and,
(m) Settlement Statement. A settlement statement setting forth the
amounts paid by or on behalf of and/or credited to each of Purchaser and
Seller pursuant to this Agreement.
12. Purchaser's Closing Documents. Purchaser shall deliver the balance of
the Purchase Price and shall obtain or execute and deliver to Seller at Closing
the following documents, all of which shall be duly executed and acknowledged
where required and shall survive the Closing:
(a) Blanket Transfer. The Blanket Transfer and Assignment;
(b) Assignment and Assumption of Lease. The Assignment and
Assumption of Lease; and
(c) Settlement Statement. A settlement statement setting forth the
amounts paid by or on behalf of and/or credited to each of Purchaser and
Seller pursuant to this Agreement.
13. Closing Costs. Seller shall pay the cost of the Title Report, the
premium for a CLTA Owner's Policy of Title Insurance issued pursuant thereto,
the cost of any recording fees, grantor, documentary or transfer tax imposed by
the State of California, Alameda County and local transfer taxes, if any, upon
the conveyance of the Property pursuant hereto, the attorneys' fees of Seller
and closing costs of the loan referred to in paragraph 6(h) and all other costs
and expenses incurred by Seller in closing and consummating the purchase and
sale of the Property pursuant hereto. Purchaser shall pay for the difference in
premium between a CLTA and an ALTA title policy, any loan closing costs, for its
attorneys' fees and all other costs and expenses incurred by Purchaser in
closing and consummating the purchase and sale of the Property pursuant hereto.
The parties shall each pay one-half of any escrow fees.
14. Prorations. The following items shall be prorated and/or credited
between Seller and Purchaser as of Midnight preceding the date of Closing:
(a) Rent. Rent, additional rents, operating costs, and other income
of the Property (other than security deposits) collected by Seller from
Tenant for the month of Closing. Seller shall pay to Purchaser at Closing
any rents or other sums prepaid by Tenant for any period following the
month of Closing. The parties shall adjust after Closing for any
uncollected rent or other income under the Lease that shall become due and
payable upon final reconciliation of any pass-through items under the
Lease. Seller further reserves the right to collect (without any right to
pursue the right of possession against the Tenant under the Lease) any
delinquent rents or other sums payable under the Lease as of the Closing.
(b) Property Taxes. Except for such taxes which are the
responsibility of Tenant and for which Seller has not received payment,
City, state, county, and school district ad valorem taxes based on the ad
valorem tax bills for the Property, if then available, or if not, then on
the basis of the latest available tax figures and information. Should such
proration be based on such latest available tax figures and information
and prove to be inaccurate upon receipt of the ad valorem tax bills for
the Property for the year of Closing, either Seller or Purchaser, as the
case may be, may demand at any time after Closing a payment from the other
correcting such malapportionment. In addition, if after Closing there is
an adjustment or reassessment by any governmental authority with respect
to, or affecting, any ad valorem taxes for the Property for the year of
Closing or any prior year, any additional tax payment or refund for the
Property required to be paid or refunded with respect to the year of
Closing shall be prorated between Purchaser and Seller and any such
additional tax payment or refund for the Property for any year prior to
the year of Closing shall be paid by or to Seller, as the case may be.
This agreement shall expressly survive the Closing.
(c) Utility Charges. Except for utilities which are the
responsibility of Tenant and for which Seller has not received payment,
Seller shall pay all utility bills received prior to Closing and shall
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be responsible for utilities furnished to the Property prior to Closing.
Purchaser shall be responsible for the payment of all bills for utilities
furnished to the Property subsequent to the Closing. Seller and Purchaser
hereby agree to prorate and pay their respective shares of all utility
bills received subsequent to Closing, which agreement shall survive
Closing.
15. PURCHASER'S DEFAULT. IN THE EVENT OF DEFAULT BY PURCHASER UNDER THE
TERMS OF THIS AGREEMENT, SELLER'S SOLE AND EXCLUSIVE REMEDY SHALL BE TO RECEIVE
THE XXXXXXX MONEY AS LIQUIDATED DAMAGES AND THEREAFTER THE PARTIES HERETO SHALL
HAVE NO FURTHER RIGHTS OR OBLIGATIONS HEREUNDER WHATSOEVER. IT IS HEREBY AGREED
THAT SELLER'S DAMAGES WILL BE DIFFICULT TO ASCERTAIN AND THAT THE XXXXXXX MONEY
CONSTITUTES A REASONABLE LIQUIDATION THEREOF AND IS INTENDED NOT AS A PENALTY,
BUT AS FULLY LIQUIDATED DAMAGES. SELLER AGREES THAT IN THE EVENT OF DEFAULT BY
PURCHASER, IT SHALL NOT INITIATE ANY PROCEEDING TO RECOVER DAMAGES FROM
PURCHASER, BUT SHALL LIMIT ITS RECOVERY TO THE RETENTION OF THE XXXXXXX MONEY.
-------------------------
Seller's Initials
-------------------------
Purchaser's Initials
16. Seller's Default. In the event of default by Seller under the terms of
this Agreement, except as otherwise specifically set forth herein, at
Purchaser's option: (i) Purchaser may terminate this Agreement by written notice
to Seller, whereupon the Xxxxxxx Money shall be immediately returned by Escrow
Agent to Purchaser, and the parties hereto shall have no further rights or
obligations hereunder whatsoever, or (ii) Purchaser shall be entitled to an
immediate refund of the Xxxxxxx Money and to pursue the remedy of specific
performance as its sole and exclusive remedies.
17. Condemnation. If, prior to the Closing, all or any part of the
Property valued at more than $100,000 is subjected to a bona fide threat of
condemnation by a body having the power of eminent domain or is taken by eminent
domain or condemnation (or sale in lieu thereof), or if Seller has received
notice that any condemnation action or proceeding with respect to the Property
is contemplated by a body having the power of eminent domain, Seller shall give
Purchaser immediate written notice of such threatened or contemplated
condemnation or of such taking or sale, and Purchaser may by written notice to
Seller given within thirty (30) days of the receipt of such notice from Seller,
elect to cancel this Agreement. If Purchaser chooses to cancel this Agreement in
accordance with this Paragraph 17, then the Xxxxxxx Money shall be returned
immediately to Purchaser by Escrow Agent and except as otherwise provided
herein, the rights, duties, obligations, and liabilities of the parties
hereunder shall immediately terminate and be of no further force and effect. If
Purchaser does not elect to cancel this Agreement in accordance herewith or the
portion of the Property in question is valued at less than $100,000, this
Agreement shall remain in full force and effect and the sale of the Property
contemplated by this Agreement, less any interest taken by eminent domain or
condemnation, or sale in lieu thereof, shall be effected with no further
adjustment and without reduction of the Purchase Price, and at the Closing,
Seller shall assign, transfer, and set over to Purchaser all of the right,
title, and interest of Seller in and to any awards that have been or that may
thereafter be made for such taking.
18. Damage or Destruction. If any of the Improvements shall be destroyed
or damaged prior to the Closing, and the estimated cost of repair or replacement
exceeds One Hundred Thousand Dollars ($100,000) or if the Lease shall terminate
as a result of such damage, Purchaser may, by written notice given to Seller
within ten (10) days after receipt of written notice from Seller of such damage
or destruction, elect to terminate this Agreement, in which event the Xxxxxxx
Money shall immediately be returned by Escrow Agent to Purchaser and except as
expressly provided herein to the contrary, the rights, duties, obligations, and
liabilities of all parties hereunder shall immediately terminate and be of no
further force or effect. If Purchaser does not elect to terminate this Agreement
pursuant to this Paragraph 18, or has no right to terminate this Agreement
(because the
10
damage or destruction does not exceed $100,000 and the Lease remains in full
force and effect), and the sale of the Property is consummated, Purchaser shall
be entitled to receive all insurance proceeds paid or payable to Seller by
reason of such destruction or damage under the insurance required to be
maintained by Seller pursuant to Paragraph 9(d) hereof (less amounts of
insurance theretofore received and applied by Seller to restoration) and Seller
shall pay to Purchaser the amount of any deductible thereunder. If the amount of
said casualty or rent loss insurance proceeds is not settled by the date of
Closing, Seller shall execute at Closing all proofs of loss, assignments of
claim, and other similar instruments to ensure that Purchaser shall receive all
of Seller's right, title, and interest in and under said insurance proceeds.
19. Hazardous Substances. To Seller's actual knowledge (Xxxxxx X. Xxxxxx
and/or Xxxxxxx Xxxxxxx) (a) there are no "hazardous substances" (as defined in
Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42
U.S.C. Sections 9601 et seq. as amended) at the Property; (b) there has been no
release or threat of release of any such hazardous substance; (c) the Property
is not subject to regulation by any governmental entity as result of the
presence of (A) stored, leaked or spilled petroleum products,(B) underground
storage tanks, (C) an accumulation of rubbish, debris or other solid waste, or
because of the presence, release, threat of release, discharge, storage,
treatment, generation or disposal of any "hazardous waste" (as defined in the
Resource Conservation and Recovery Act, 42 U.S.C. Section 6901 et seq., as
amended), or "toxic substance" (as defined in the Toxic Substance Control Act,
15 U.S.C. Section 2601 et seq., as amended), including without limitation
asbestos and items or equipment containing polychlorinated biphenyls (PCBs) in
excess of 50 parts per million; and (d) no environmental condition exists on the
Property that either (X) requires the owner of the Property to report such
condition to any authority or agency of the State of California or (Y) requires
the owner of the Property to make a notation of such condition in any public
records or conveyancing instrument upon the conveyance of the Property. Seller
covenants during the period of this Agreement not to discharge or store any such
materials on the Property.
20. Assignment. Purchaser's rights and duties under this Agreement shall
be freely transferable and assignable by Purchaser to an affiliate of Purchaser,
Purchaser shall remain liable for the performance of all obligations, covenants,
conditions, and agreements imposed upon Purchaser pursuant to the terms of this
Agreement.
21. Broker's Commission. Seller has agreed to pay a real estate commission
of 3% to The Royston Group and Spectrum Interests (the "Broker"). Purchaser and
Seller hereby represent each to the other that they have not discussed this
Agreement or the subject matter hereof with any real estate broker or agent
other than Broker so as to create any legal right in any such broker or agent to
claim a real estate commission with respect to the conveyance of the Property
contemplated by this Agreement. Seller shall and does hereby indemnify and hold
harmless Purchaser from and against any claim, whether or not meritorious, for
any real estate sales commission, finder's fees, or like compensation in
connection with the sale contemplated hereby and arising out of any act or
agreement of Seller. Likewise, Purchaser shall and does hereby indemnify and
hold harmless Seller from and against any claim, whether or not meritorious, for
any real estate sales commission, finder's fees, or like compensation in
connection with the sale contemplated hereby and arising out of any act or
agreement of Purchaser, except any such claim asserted by Broker, or any broker
or agent claiming under Broker. This Paragraph 21 shall survive the Closing or
any termination of this Agreement.
22. Notices. Wherever any notice or other communication is required or
permitted hereunder, such notice or other communication shall be in writing and
shall be delivered by overnight courier, by hand, or sent by U.S. registered or
certified mail, return receipt requested, postage prepaid, to the addresses set
out below or at such other addresses as are specified by written notice
delivered in accordance herewith:
PURCHASER: c/x Xxxxx Capital, Inc.
0000 Xxxxxxx Xxxxxx Xxxx
Xxxxxxxx, Xxxxxxx 00000
Attn: Xx. Xxx X. Xxxxx, III
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with a copy to: X'Xxxxxxxxx & Xxxxx LLP
000 Xxxxxxxxx Xxxxxx X.X., Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Attn: Xxxxxxx X. X'Xxxxxxxxx, Xx., Esq.
SELLER: 0000 Xxxxxxxxxx Xxxxxx
Xxxxx 000
Xxxxx Xxxxx, XX 00000
with a copy to: Xxxx Xxxxxxxx, Esq.
000 Xxxxxxxx Xxx., Xxx. 000
Xxxx Xxxx, XX 00000
Any notice or other communication given as hereinabove provided shall be deemed
effectively given or received on the date of delivery.
23. Possession. Possession of the Property shall be granted by Seller to
Purchaser on the date of Closing, subject only to the Leases and the Permitted
Exceptions.
24. Time Periods. If the time period by which any right, option, or
election provided under this Agreement must be exercised, or by which any act
required hereunder must be performed, or by which the Closing must be held,
expires on a Saturday, Sunday, or holiday, then such time period shall be
automatically extended through the close of business on the next regularly
scheduled business day in San Jose, California.
25. Survival of Provisions. All covenants, warranties, and agreements set
forth in this Agreement shall survive the execution or delivery of any and all
deeds and other documents at any time executed or delivered under, pursuant to,
or by reason of this Agreement, and shall survive the payment of all monies made
under, pursuant to, or by reason of this Agreement, for a period of 24 months
following Closing.
26. Severability. This Agreement is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules, and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent
be invalid or unenforceable, the remainder of this Agreement and the application
of such provision to other persons or circumstances shall not be affected
thereby but rather shall be enforced to the greatest extent permitted by law.
27. Authorization. Purchaser represents to Seller that this Agreement has
been duly authorized and executed on behalf of Purchaser and constitutes the
valid and binding agreement of Purchaser, enforceable in accordance with its
terms, and all necessary action on the part of Purchaser to authorize the
transactions herein contemplated has been taken, and no further action is
necessary for such purpose.
28. General Provisions. No failure of either party to exercise any power
given hereunder or to insist upon strict compliance with any obligation
specified herein, and no custom or practice at variance with the terms hereof,
shall constitute a waiver of either party's right to demand exact compliance
with the terms hereof. This Agreement contains the entire agreement of the
parties hereto, and no representations, inducements, promises, or agreements,
oral or otherwise, between the parties not embodied herein shall be of any force
or effect. Any amendment to this Agreement shall not be binding upon the parties
hereto unless such amendment is in writing and executed by all parties hereto.
Subject to the provisions of paragraph 20, the provisions of this Agreement
shall inure to the benefit of and be binding upon the parties hereto and their
respective heirs, legal representatives, successors, and assigns. Time is of the
essence of this Agreement. This Agreement may be executed in multiple
counterparts, each of which shall constitute an original, but all of which taken
together shall constitute one and the same agreement. The headings inserted at
the beginning of each paragraph are for convenience only, and do not add to or
subtract from the meaning of the contents of each paragraph. This Agreement
shall be construed and interpreted under the laws of the State of California.
Except as otherwise provided herein, all rights, powers, and privileges
conferred hereunder upon the parties shall be cumulative but not restrictive to
those given by law. All personal pronouns used in this Agreement, whether used
in the
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masculine, feminine, or neuter gender shall include all genders, and all
references herein to the singular shall include the plural and vice versa.
29. Effective Date. The "Effective Date" of this Agreement shall be deemed
to be the date this Agreement is fully executed by both Purchaser and Seller and
a fully executed original counterpart of this Agreement has been received by
both Purchaser and Seller. If the Effective Date does not occur on or before
June 8, 1998, this Agreement shall be void and of no further force and effect.
30. Tax Free Exchanges. Seller shall have the full and unrestricted right
to assign the rights and obligations of Seller under the final Purchase
Agreement, to one or more substitute buyer or buyers; but such assignment shall
not relieve Seller of Seller's obligations hereunder. The purpose of any such
assignment is to enable the substitute buyer or buyers to exchange the Property
for property owned by Seller, pursuant to a separate exchange agreement between
Seller and such substitute buyer or buyers in order to effect a real property
exchange under Internal Revenue Code Section 1031. Buyer agrees to cooperate in
such exchange, including the execution of all documents reasonably required by
Seller's attorney, at no cost or liability to Buyer, and provided that Buyer
shall not be required to take title to any other real estate. Seller agrees to
hold Buyer harmless from any liability, damage or costs including reasonable
attorney's fees that may arise from Buyer's participation in such exchange.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and their respective seals to be affixed hereunto as of the day,
month and year first above written.
"SELLER":
ROSE VENTURES V, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
-----------------------------
Xxxxxxx X. Xxxxxxx
Its: President
/s/ Xxxxxx X. Xxxxx
----------------------------------
XXXXXX X. XXXXX
/s/ Xxxxxxx X. Xxxxx
----------------------------------
XXXXXXX X. XXXXX
"PURCHASER":
XXXXX DEVELOPMENT CORPORATION
By: /s/ Xxxxx X. Xxxxxx
------------------------------
Its: EXECUTIVE VICE PRESIDENT
-------------------------
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