EXHIBIT 10.18
AGREEMENT OF SALE AND PURCHASE
THIS AGREEMENT OF SALE AND PURCHASE ("AGREEMENT") made this 31st day of
January, 2000 by and between GROVE STREET ASSOCIATES OF JERSEY CITY LIMITED
PARTNERSHIP and CALI-GROVE STREET URBAN RENEWAL ASSOCIATES L.P., each a limited
partnership organized under the laws of the State of New Jersey, both having an
address c/o Xxxx-Xxxx Realty Corporation, 00 Xxxxxxxx Xxxxx, Xxxxxxxx, Xxx
Xxxxxx 00000 (collectively, "SELLER") and COMMERZLEASING UND IMMOBILIEN GmbH,
("CLI"), a corporation organized under the laws of the Federal Republic of
Germany, having an address at Xxxxxx-Xxxxxx-Allee-9, X-00000 Xxxxxxxxxx,
Xxxxxxx, and GERMANIA OF AMERICA, INC. ("GERMANIA"), a corporation organized
under the laws of the State of Georgia, having an address at Tower Place, Suite
2995, 0000 Xxxxxxxxx Xxxx, X.X., Xxxxxxx, Xxxxxxx 00000 (collectively,
"PURCHASER").
In consideration of the mutual promises, covenants, and agreements set
forth herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Seller and Purchaser agree as
follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 DEFINITIONS. For purposes of this Agreement, the following
capitalized terms have the meanings set forth in this Section 1.1:
"ASSIGNMENT" has the meaning ascribed to such term in Section 10.3(d), in
the form attached hereto as EXHIBIT A.
"ASSIGNMENT OF LEASES" has the meaning ascribed to such term in Section
10.3(c), in the form attached hereto as EXHIBIT B.
"AUTHORITIES" means the various governmental and quasi-governmental bodies
or agencies having jurisdiction over the Real Property and Improvements, or any
portion thereof.
"XXXX OF SALE" has the meaning ascribed to such term in Section 10.3(b),
in the form attached hereto as EXHIBIT C.
"BROKERAGE COMMISSION AGREEMENTS" means the agreements set forth on
EXHIBIT N.
"BROKERS" has the meaning ascribed to such term in Section 16.1.
"BUSINESS DAY" means any day other than a Saturday, Sunday or a day on
which national banking associations are authorized or required to close.
"CERTIFICATE AS TO FOREIGN STATUS" has the meaning ascribed to such
term in Section 10.3(g).
"CERTIFYING PERSON" has the meaning ascribed to such term in Section
4.3.
"CITY" means the City of Jersey City, a municipal corporation of the State
of New Jersey.
"CITY CONSENT" has the meaning ascribed to such term in Section 7.1(f).
"CLOSING" means the consummation of the purchase and sale of the Property
contemplated by this Agreement, as provided for in Article X.
"CLOSING DATE" means the earlier to occur of (i) March 15, 2000 or (ii)
the date which is thirty (30) days following the date that Purchaser waives its
right to terminate this Agreement pursuant to Section 5.3; PROVIDED, HOWEVER,
that the Closing Date may also be extended by mutual written agreement of Seller
and Purchaser. Notwithstanding anything to the contrary contained herein, (a)
Seller shall have the right to extend the Scheduled Closing Date for up to sixty
(60) days upon notice to Purchaser if as of such date, the City shall not have
given the City Consent, Seller shall not have obtained the ISRA letter, Seller
shall not have obtained the estoppel letters required from the Major Tenants as
provided herein, title to the Real Property shall not be as provided for in
Section 6.3(a), or any of the foregoing; and (b) Purchaser shall have the right
to extend the Scheduled Closing Date for up to sixty (60) days upon notice to
Seller if as of such date, the City shall not have given the City Consent,
Seller shall not have obtained the estoppel letters required from the Major
Tenants as provided herein, or both. If Purchaser extends the Scheduled Closing
Date due to the fact that Seller did not obtain the estoppel letters from the
Major Tenants, Purchaser may contact the Major Tenants, with Seller's
representatives present, in order to discuss the status of the estoppel letters.
"CLOSING STATEMENT" has the meaning ascribed to such term in Section
10.4(a).
"CLOSING SURVIVING OBLIGATIONS" means the rights, liabilities and
obligations set forth in Sections 3.2, 5.4, 8.1(d) [to the extent set forth in
Section 8.3], 8.2, 8.3, 10.4, 10.6, 11.1, 11.2, Article XIV, 16.1, 18.2, 18.8
and Article XXI, and any other provisions which pursuant to their terms survives
the Closing hereunder.
"CODE" has the meaning ascribed to such term in Section 4.3.
"CONFIDENTIALITY AGREEMENT" means that certain Confidentiality Agreement
annexed hereto as EXHIBIT M.
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"DEED" has the meaning ascribed to such term in Section 10.3(a).
"DELINQUENT RENTAL" has the meaning ascribed to such term in Section
10.4(b).
"DOCUMENTS" has the meaning ascribed to such term in Section 5.2(a).
"XXXXXXX MONEY DEPOSIT" has the meaning ascribed to such term in
Section 4.1.
"EFFECTIVE DATE" means the latest date on which this Agreement has been
executed by Seller or Purchaser, as set forth opposite such party's signature
and the Xxxxxxx Money Deposit shall have been received by the Escrow Agent.
"ENVIRONMENTAL LAWS" means each and every federal, state, county and
municipal statute, ordinance, rule, regulation, code, order, requirement,
directive, binding written interpretation and binding written policy
pertaining to Hazardous Substances issued by any Authorities and in effect as
of the date of this Agreement with respect to or which otherwise pertain to
or affect the Real Property or the Improvements, or any portion thereof, the
use, ownership, occupancy or operation of the Real Property or the
Improvements, or any portion thereof, or Purchaser, and as same have been
amended, modified or supplemented from time to time prior to the Effective
Date, including but not limited to the Comprehensive Environmental Response,
Compensation and Liability Act of 1980 (42 U.S.C. Section 9601 et seq.), the
Hazardous Substances Transportation Act (49 U.S.C. Section 1802 et seq.), the
Resource Conservation and Recovery Act (42 U.S.C. Section 6901 et seq.), as
amended by the Hazardous and Solid Wastes Amendments of 1984, the Water
Pollution Control Act (33 U.S.C. Section 1251 et seq.), the Safe Drinking
Water Act (42 U.S.C. Section 300f et seq.), the Clean Water Act (33 U.S.C.
Section 1321 et seq.), the Clean Air Act (42 U.S.C. Section 7401 et seq.),
the Solid Waste Disposal Act (42 U.S.C. Section 6901 et seq.), the Toxic
Substances Control Act (15 U.S.C. Section 2601 et seq.), the Emergency
Planning and Community Right-to-Know Act of 1986 (42 U.S.C. Section 11001 et
seq.), the Radon and Indoor Air Quality Research Act (42 U.S.C. Section 7401
note, et seq.), the National Environmental Policy Act (42 U.S.C. Section 4321
et seq.), the Superfund Amendment Reauthorization Act of 1986 (42 U.S.C.
Section 9601 et seq.), the Occupational Safety and Health Act (29 U.S.C.
Section 651 et seq.), the New Jersey Environmental Rights Act (N.J.S.A.
2A:35A-1 et seq.), the New Jersey Spill Compensation and Control Act
(N.J.S.A. 58:10-23.11 et seq.), the New Jersey Air Pollution Control Act
(N.J.S.A. 26:2C-1 et seq.), the Hazardous Substances Discharge: Reports and
Notices Act (N.J.S.A. 13:1K-15 et seq.), the Industrial Site Recovery Act
(N.J.S.A. 13:1K-6 et seq.), the New Jersey Underground Storage of Hazardous
Substances Act (N.J.S.A. 58:10A-21 et seq.) (collectively, the "Environmental
Statutes"), and any and all rules and regulations which have become effective
prior to the date of this Agreement under any and all of the Environmental
Statutes.
"ENVIRONMENTAL REPORT " means that certain Phase I Environmental Site
Assessment prepared by Environmental Waste Management Associates and addressed
Cali Associates, dated August 3, 1994, a copy of which has been
provided to Purchaser.
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"ESCROW AGENT" means Titleserv Agency of New York, Inc., as agent for
Fidelity National Title Insurance Company of New York.
"EXISTING SURVEY" means Seller's existing survey of the Real Property
dated September 12, 1989 prepared by Xxxxxx X. XxXxxxxxxx and last revised
August 17, 1994.
"EVALUATION PERIOD" means the period commencing on the Effective Date and
terminating on February 14, 2000.
"FINANCING AGREEMENT" has the meaning ascribed to such term in Section
7.1(f).
"GROUND LEASE" means that certain ground lease dated April 17, 1997
between Grove Street Associates of Jersey City Limited Partnership and
Cali-Grove Street Urban Renewal Associates L.P.
"GOVERNMENTAL REGULATIONS" means all statutes, ordinances, rules and
regulations of the Authorities applicable to Seller or the use or operation of
the Real Property or the Improvements or any portion thereof.
"HAZARDOUS SUBSTANCES" means (a) asbestos, radon gas and urea formaldehyde
foam insulation, (b) any solid, liquid, gaseous or thermal contaminant,
including smoke vapor, soot, fumes, acids, alkalis, chemicals, petroleum
products or byproducts, PCBs, phosphates, lead or other heavy metals and
chlorine, (c) any solid or liquid waste (including, without limitation,
hazardous waste), hazardous air pollutant, hazardous substance, hazardous
chemical substance and mixture, toxic substance, pollutant, pollution, regulated
substance and contaminant, as such terms are defined in any of the Environmental
Statutes as such Environmental Statutes have been amended and/or supplemented
from time to time prior to the date of this Agreement, and any and all rules and
regulations promulgated under any of the above, and (d) any other chemical,
material or substance, the use or presence of which, or exposure to the use or
presence of which, is prohibited, limited or regulated by any Environmental
Statutes.
"IMPROVEMENTS" means all buildings, structures, fixtures, parking areas
and other improvements located on the Real Property.
"ISRA LETTER" has the meaning ascribed to such term in Section 19.1.
"KEY INDIVIDUALS" means Xxxxx Xxxx, Xxxxx Xxxxxx, Xxxxx Xxxxxxxxx, Xxxxx
Xxxxxx and Xxx Xxxxx, in their corporate capacity as officers of Xxxx-Xxxx
Realty Corporation, and not in any individual or other capacity whatsoever.
"LEASE SCHEDULE" has the meaning ascribed to such term in Section
5.2(a).
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"LEASES" means all of the leases and other agreements with Tenants with
respect to the use and occupancy of the Real Property, together with all
renewals and modifications thereof, if any, and any new leases entered into
after the Effective Date.
"LICENSEE PARTIES" has the meaning ascribed to such term in Section 5.1.
"LICENSES AND PERMITS" means, collectively, all of Seller's right, title
and interest, to the extent assignable, in and to licenses, permits,
certificates of occupancy, approvals, dedications, subdivision maps and
entitlements now or hereafter issued, approved or granted by the Authorities in
connection with the Real Property and the Improvements, together with all
renewals and modifications thereof.
"MAJOR TENANTS" means DLJ Securities Corporation and NTT Data
Communications Systems Corporation.
"NEW TENANT COSTS" has the meaning ascribed to such term in Section
10.4(e).
"NTT LEASE EXTENSION" has the meaning ascribed to such term in Section
7.1(e).
"OPERATING EXPENSES" has the meaning ascribed to such term in Section
10.4(c).
"PERMITTED EXCEPTIONS" has the meaning ascribed to such term in Section
6.2(a).
"PERMITTED OUTSIDE PARTIES" has the meaning ascribed to such term in
Section 5.2(b).
"PERSONAL PROPERTY" means all of Seller's right, title and interest in and
to all equipment, appliances, tools, supplies, machinery, artwork, furnishings
and other tangible personal property attached to, appurtenant to, located in and
used exclusively in connection with the ownership or operation of the
Improvements and situated at the Property on the date hereof, subject to
Seller's right to replace such personal property with personal property of
comparable value and utility as it elects in the normal course of business.
"PROPERTY" has the meaning ascribed to such term in Section 2.1.
"PRORATION ITEMS" has the meaning ascribed to such term in Section
10.4(a).
"PURCHASE PRICE" has the meaning ascribed to such term in Section 3.1.
"PURCHASER'S INFORMATION" has the meaning ascribed to such term in
Section 5.3(c).
"REAL PROPERTY" means that certain parcel or parcels of real property
located at 00 Xxxxxxxxxxx Xxxxxxxx Xxxxx, Xxxxxx Xxxx, Xxx Xxxxxx, as more
particularly described
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on the legal description attached hereto and made a part hereof as EXHIBIT D,
together with all of Seller's right, title and interest, if any, in and to the
appurtenances pertaining thereto, including but not limited to Seller's right,
title and interest in and to the adjacent streets, alleys and right-of-ways, and
any easement rights, air rights, subsurface development rights and water rights.
"RENTAL" has the meaning ascribed to such term in Section 10.4(b), and
same are "Delinquent" in accordance with the meaning ascribed to such term in
Section 10.4(b).
"ROCKWOOD" has the meaning ascribed to such term in Section 10.5(a).
"SCHEDULED CLOSING DATE" means March 15, 2000, or such earlier or later
date to which both Purchaser and Seller may hereafter agree in writing.
"SECAUCUS LITIGATION" has the meaning ascribed to such term in Section
8.1 (d).
"SECURITY DEPOSITS" means all security deposits paid to Seller, as
landlord (together with any interest which has accrued thereon, but only to the
extent such interest has accrued for the account of the Tenant).
"SERVICE CONTRACTS" means all of Seller's right, title and interest, to
the extent assignable, in all service agreements, maintenance contracts,
equipment leasing agreements, warranties, guarantees, bonds, open purchase
orders and other contracts for the provision of labor, services, materials or
supplies relating solely to the Real Property, Improvements or Personal Property
and which are currently in effect, including those listed and described on
EXHIBIT E attached hereto, together with all renewals, supplements, amendments
and modifications thereof, and any new such agreements entered into after the
Effective Date, to the extent permitted by Section 7.1. Service Contracts shall
not include Brokerage Commission Agreements.
"SIGNIFICANT PORTION" means, for purposes of the casualty provisions set
forth in Article XI hereof, damage by fire or other casualty to the Real
Property and the Improvements or a portion thereof, the cost of which to repair
would exceed Five Million Dollars ($5,000,000) in the aggregate.
"SURVEY OBJECTION" has the meaning ascribed to such term in Section 6.1.
"TENANTS" means the tenants or users who are parties to the Leases.
"TENANT NOTICE LETTERS" has the meaning ascribed to such term in Section
10.2(e), and are to be delivered by Purchaser to Tenants pursuant to Section
10.6.
"TERMINATION SURVIVING OBLIGATIONS" means the rights, liabilities and
obligations set forth in Sections 5.2, 5.3, 12.1, Articles XIII and XIV, 16.1,
18.2 and 18.8,
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and any other provisions which pursuant to their terms survive any termination
of this Agreement.
"TITLE COMMITMENT" has the meaning ascribed to such term in Section 6.2.
"TITLE COMPANY" means Fidelity National Title Insurance Company of New
York.
"TITLE OBJECTIONS" has the meaning ascribed to such term in Section 6.2.
"TITLE POLICY" has the meaning ascribed to such term in Section 6.2.
"TO SELLER'S KNOWLEDGE" means the actual (as opposed to constructive or
imputed) knowledge of the Key Individuals, without any independent investigation
or inquiry whatsoever.
"XXXXXXXX" has the meaning ascribed to such term in Section 10.5(b).
"UPDATED SURVEY" has the meaning ascribed to such term in Section 6.1.
SECTION 1.2 REFERENCES: EXHIBITS AND SCHEDULES. Except as otherwise
specifically indicated, all references in this Agreement to Articles or Sections
refer to Articles or Sections of this Agreement, and all references to Exhibits
or Schedules refer to Exhibits or Schedules attached hereto, all of which
Exhibits and Schedules are incorporated into, and made a part of, this Agreement
by reference. The words "herein," "hereof," "hereinafter" and words and phrases
of similar import refer to this Agreement as a whole and not to any particular
Section or Article.
ARTICLE II
AGREEMENT OF PURCHASE AND SALE
SECTION 2.1 AGREEMENT. Grove Street Associates of Jersey City Limited
Partnership is the owner in fee of the Real Property. Cali-Grove Street Urban
Renewal Associates L.P. is the holder of the leasehold interest under the Ground
Lease. Seller hereby agrees to sell, convey and assign to Purchaser, and
Purchaser hereby agrees to purchase and accept from Seller, on the Closing Date
and subject to the terms and conditions of this Agreement, all of the following
(collectively, the "PROPERTY"):
(a) the Real Property including both such fee and such
leasehold interests;
(b) the Improvements;
(c) the Personal Property;
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(d) all of Seller's right, title and interest as lessor in and to
the Leases and, subject to the terms of the respective applicable Leases, the
Security Deposits;
(e) all of Seller's right, title and interest in, to and under the
Service Contracts and the Licenses and Permits; and
(f) all of Seller's right, title and interest, to the extent
assignable or transferable, in and to all other intangible rights, titles,
interests, privileges and appurtenances owned by Seller and related to or used
exclusively in connection with the ownership, use or operation of the Real
Property or the Improvements.
SECTION 2.2 INDIVISIBLE ECONOMIC PACKAGE. Purchaser has no right to
purchase, and Seller has no obligation to sell, less than all of the Property,
it being the express agreement and understanding of Purchaser and Seller that,
as a material inducement to Seller and Purchaser to enter into this Agreement,
Purchaser has agreed to purchase, and Seller has agreed to sell, all of the
Property, subject to and in accordance with the terms and conditions hereof.
ARTICLE III
CONSIDERATION
SECTION 3.1 PURCHASE PRICE. The purchase price for the Property (the
"PURCHASE PRICE") shall be One Hundred Fifty Five Million Dollars ($155,000,000)
in lawful currency of the United States of America, payable as provided in
Section 3.3, and subject to adjustment as provided in Section 3.4. No portion of
the Purchase Price shall be allocated to the Personal Property.
SECTION 3.2 ASSUMPTION OF OBLIGATIONS. As additional consideration for the
purchase and sale of the Property, at Closing Purchaser will assume the Leases,
Security Deposits, Service Contracts (to the extent not terminated as provided
in Section 7.4(c)) and Licenses and Permits in accordance with the Assignment of
Leases and the Assignment.
SECTION 3.3 METHOD OF PAYMENT OF PURCHASE PRICE. No later than 12:00 p.m.
Eastern time on the Closing Date, Purchaser shall pay to Seller the Purchase
Price (less the Xxxxxxx Money Deposit), together with all other costs and
amounts to be paid by Purchaser at the Closing pursuant to the terms of this
Agreement ("PURCHASER'S COSTS"), by Federal Reserve wire transfer of immediately
available funds to the account of Escrow Agent. Escrow Agent, following
authorization by the parties at Closing, shall (i) pay to Seller by Federal
Reserve wire transfer of immediately available funds to an account designated by
Seller, the Purchase Price, less any costs or other amounts to be paid by Seller
at Closing pursuant to the terms of this Agreement, (ii) pay to the appropriate
payees out of the proceeds of Closing payable to Seller all costs and amounts to
be paid by Seller at Closing pursuant to the terms of this Agreement, and (iii)
pay Purchaser's Costs to the appropriate payees at Closing pursuant to the terms
of this Agreement.
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SECTION 3.4 ADJUSTMENT OF PURCHASE PRICE/ADDITIONAL CONSIDERATION
(a) If, three (3) Business Days prior to the Closing Date, Seller has
not obtained the NTT Lease Extension in accordance with the terms and conditions
set forth in Section 7.4(a) hereof, then the Purchase Price shall be reduced by
an amount equal to Two Million Five Hundred Thousand Dollars ($2,500,000).
(b) If, during the first ninety (90) days after the Closing, Seller
obtains the NTT Lease Extension in accordance with the terms and conditions set
forth in Section 7.4(a) hereof, then Purchaser shall pay to Seller additional
consideration in the amount of Two Million Five Hundred Thousand Dollars
($2,500,000). If, during the one hundred and eighty (180) days after the
expiration of said ninety (90) day period, Seller obtains the NTT Lease
Extension, then the additional consideration due from Purchaser to Seller shall
be Five Hundred Thousand Dollars ($500,000).
(c) Any payment of additional consideration pursuant to Section 3.4(b)
shall be made by Federal Reserve wire transfer of immediately available funds to
an account designated by Seller, within five (5) Business Days of the date such
amount becomes due. The provisions of this Section 3.4 shall survive the
Closing.
ARTICLE IV
XXXXXXX MONEY DEPOSIT
AND ESCROW INSTRUCTIONS
SECTION 4.1 THE XXXXXXX MONEY DEPOSIT. Within two (2) Business Days
following the execution and delivery of this Agreement by Purchaser, Purchaser
shall deposit with the Escrow Agent, by Federal Reserve wire transfer of
immediately available funds, the sum of Two Million Five Hundred Thousand
Dollars ($2,500,000) as the xxxxxxx money deposit on account of the Purchase
Price (the "XXXXXXX MONEY DEPOSIT"). In the event that Purchaser shall fail to
deliver to Escrow Agent the Xxxxxxx Money Deposit within the aforesaid two (2)
Business Day period, then this Agreement shall automatically terminate and be
void AB INITIO. TIME IS OF THE ESSENCE with respect to the deposit of the
Xxxxxxx Money Deposit.
SECTION 4.2 ESCROW INSTRUCTIONS. The Xxxxxxx Money Deposit shall be held
in escrow by the Escrow Agent in an interest-bearing account, in accordance with
the provisions of Article XVII. In the event this Agreement is terminated by
Purchaser prior to the expiration of the Evaluation Period or in the event
Purchaser fails to advise Seller in writing that Purchaser is proceeding under
this Agreement by notice to Seller given prior to the expiration of the
Evaluation Period, the Xxxxxxx Money Deposit, together with all interest earned
thereon, shall be refunded to Purchaser. In the event this Agreement is not
terminated by Purchaser pursuant to the terms hereof by the end of the
Evaluation Period in accordance with the provisions of Section 5.3(c) herein,
the Xxxxxxx Money Deposit shall become non-refundable to Purchaser. Any interest
earned on the Xxxxxxx
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Money Deposit shall be paid to Purchaser promptly following the Closing Date or
the earlier termination of this Agreement.
SECTION 4.3 DESIGNATION OF CERTIFYING PERSON. In order to assure
compliance with the requirements of Section 6045 of the Internal Revenue Code of
1986, as amended (the "CODE"), and any related reporting requirements of the
Code, the parties hereto agree as follows:
(a) Provided the Escrow Agent shall execute a statement in writing
(in form and substance reasonably acceptable to the parties hereunder) pursuant
to which it agrees to assume all responsibilities for information reporting
required under Section 6045(e) of the Code, Seller and Purchaser shall designate
the Escrow Agent as the person to be responsible for all information reporting
under Section 6045(e) of the Code (the "CERTIFYING PERSON"). If the Escrow Agent
refuses to execute a statement pursuant to which it agrees to be the Certifying
Person, Seller and Purchaser shall agree to appoint another third party as the
Certifying Person.
(b) Seller and Purchaser each hereby agree:
(i) to provide to the Certifying Person all information and
certifications regarding such party, as reasonably requested by the
Certifying Person or otherwise required to be provided by a party to
the transaction described herein under Section 6045 of the Code; and
(ii) to provide to the Certifying Person such party's taxpayer
identification number and a statement (on Internal Revenue Service
Form W-9 or an acceptable substitute form, or on any other form the
applicable current or future Code sections and regulations might
require and/or any form requested by the Certifying Person), signed
under penalties of perjury, stating that the taxpayer identification
number supplied by such party to the Certifying Person is correct.
ARTICLE V
INSPECTION OF PROPERTY
SECTION 5.1 EVALUATION PERIOD. For the period ending at 5:00 p.m. Eastern
time on February 14, 2000 (the "EVALUATION PERIOD"), Purchaser and its
authorized agents and representatives (for purposes of this Article V, the
"LICENSEE PARTIES") shall have the right, subject to the right of any Tenants,
to enter upon the Property at all reasonable times during normal business hours
to perform an inspection of the Property. Purchaser will provide to Seller
notice (for purposes of this Section 5.1(a), an "ENTRY NOTICE") of the intention
of Purchaser or the other Licensee Parties to enter the Property at least 24
hours prior to such intended entry and specify the intended purpose therefor and
the inspections and examinations contemplated to be made and with whom any
Licensee Party will communicate. At Seller's option, Seller may be present for
any such entry and
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inspection. Purchaser shall not communicate with or contact any of the Tenants
without the prior written consent of Seller, unless a representative of Seller
is present. If Purchaser elects to meet with any of the Authorities regarding
the condition of the Property or to obtain the City Consent, it shall give
Seller prior notice thereof, and Seller and Seller's representatives shall have
the right, but not the obligation, to attend, and participate in, all such
meetings. Notwithstanding anything to the contrary contained herein, no physical
testing or sampling shall be conducted during any such entry by Purchaser or any
Licensee Party upon the Property without Seller's specific prior written
consent, which consent shall not be unreasonably withheld or delayed. TIME IS OF
THE ESSENCE with respect to the provisions of this Section 5.1.
SECTION 5.2 DOCUMENT REVIEW.
(a) During the Evaluation Period, Purchaser and the Licensee
Parties shall have the right to review and inspect, at Purchaser's sole cost and
expense, all of the following which are in Seller's possession or control
(collectively, the "DOCUMENTS"): all existing environmental, engineering or
consulting reports and studies of the Property (which Purchaser shall have the
right to have updated at Purchaser's sole cost and expense), architectural,
mechanical and structural plans, specifications or drawings related to the
property, real estate tax bills, together with assessments (special or
otherwise), ad valorem and personal property tax bills, covering the period of
Seller's ownership of the Property; its most current lease schedule in the form
attached hereto as EXHIBIT F (the "LEASE SCHEDULE"); current operating
statements; the Leases, lease files, Service Contracts, and Licenses and
Permits. To the extent Seller has not, prior to the date hereof, delivered
copies of the Documents to Purchaser or the Licensee Parties, Seller shall do so
unless it shall be impractical or unreasonably prohibitive to do so. To the
extent Seller does not possess a set of any architectural, mechanical and
structural plans, specifications or drawings relating to the Property which are
in the possession of a third party, Seller shall reasonably cooperate with
Purchaser in obtaining such plans from the third party, if requested by
Purchaser. Inspections of any Documents for which Seller has not provided
Purchaser and the Licensee Parties a copy shall occur at a location selected by
Seller, which may be at the office of Seller, Seller's counsel, Seller's
property manager, at the Real Property or any of them. Purchaser shall not have
the right to review or inspect materials not directly related to the leasing,
maintenance and/or management of the Property, including, without limitation,
all of Seller's internal memoranda, financial projections, budgets, appraisals,
proposals for work not actually undertaken, accounting and income tax records
and similar proprietary, elective or confidential information.
(b) Purchaser acknowledges that any and all of the Documents may
be proprietary and confidential in nature and have been provided to Purchaser
solely to assist Purchaser in determining the desirability of purchasing the
Property. Subject only to the provisions of Article XII, Purchaser agrees not to
disclose the contents of the Documents or any of the provisions, terms or
conditions contained therein, to any party outside of Purchaser's organization
other than its attorneys, partners, accountants, lenders or
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investors (collectively, for purposes of this Section 5.2(b), the "PERMITTED
OUTSIDE PARTIES"). Purchaser further agrees that within its organization, or as
to the Permitted Outside Parties, the Documents will be disclosed and exhibited
only to those persons within Purchaser's organization or to those Permitted
Outside Parties who are responsible for determining the desirability of
Purchaser's acquisition of the Property. Purchaser further acknowledges that the
Documents and other information relating to the leasing arrangements between
Seller and Tenants are proprietary and confidential in nature. Purchaser agrees
not to divulge the contents of such Documents and other information except in
strict accordance with the confidentiality standards set forth in this Section
5.2 and Article XII. In permitting Purchaser and the Permitted Outside Parties
to review the Documents and other information to assist Purchaser, Seller has
not waived any privilege or claim of confidentiality with respect thereto, and
no third party benefits or relationships of any kind, either express or implied,
have been offered, intended or created by Seller, and any such claims are
expressly rejected by Seller and waived by Purchaser and the Permitted Outside
Parties.
(c) Purchaser acknowledges that some of the Documents may have
been prepared by third parties and may have been prepared prior to Seller's
ownership of the Property. PURCHASER HEREBY ACKNOWLEDGES THAT EXCEPT AS SET
FORTH IN SECTION 8.1, SELLER HAS NOT MADE AND DOES NOT MAKE ANY REPRESENTATION
OR WARRANTY REGARDING THE TRUTH, ACCURACY OR COMPLETENESS OF THE DOCUMENTS OR
THE SOURCES THEREOF OR THAT SELLER HAS DELIVERED ALL OF THE DOCUMENTS. EXCEPT AS
SET FORTH IN SECTION 8.1, SELLER HAS NOT UNDERTAKEN ANY INDEPENDENT
INVESTIGATION AS TO THE TRUTH, ACCURACY OR COMPLETENESS OF THE DOCUMENTS AND IS
PROVIDING THE DOCUMENTS SOLELY AS AN ACCOMMODATION TO PURCHASER.
SECTION 5.3 ENTRY AND INSPECTION OBLIGATIONS; TERMINATION OF AGREEMENT.
(a) Purchaser agrees that in entering upon and inspecting or
examining the Property, Purchaser and the other Licensee Parties will not:
disturb the Tenants or interfere with the use of the Property pursuant to the
Leases; interfere with the operation and maintenance of the Real Property or
Improvements; damage any part of the Property or any personal property owned or
held by Tenants or any other person or entity; injure or otherwise cause bodily
harm to Seller or any Tenant, or to any of their respective agents, guests,
invitees, contractors and employees, or to any other person or entity; permit
any liens to attach to the Real Property by reason of the exercise of
Purchaser's rights under this Article V; and reveal or disclose any information
obtained concerning the Property and the Documents to anyone outside Purchaser's
organization, except in accordance with the confidentiality standards set forth
in Section 5.2(b) and Article XII. Purchaser will: (i) cause all of Purchaser's
consultants which are to perform physical inspections and/or testing on the Real
Property or Improvements to maintain comprehensive general liability
(occurrence) insurance, and in the event of invasive testing, contractor's
pollution liability insurance, in amounts which reasonably prudent consultants
in their field
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customarily maintain insuring Seller, Purchaser and such other parties as Seller
shall reasonably request, covering any accident or event arising in connection
with the presence of Purchaser or the other Licensee Parties on the Real
Property or Improvements, and deliver evidence of insurance verifying such
coverage to Seller prior to entry upon the Real Property or Improvements; (ii)
promptly pay when due the costs of all entry and inspections and examinations
done with regard to the Property by or on behalf of Purchaser or the Licensee
Parties; (iii) cause any inspection to be conducted in accordance with standards
customarily employed in the industry and in compliance with all Governmental
Regulations; (iv) at Seller's written request, furnish to Seller copies of any
studies, reports or test results received by Purchaser regarding the Property,
promptly after such receipt, in connection with such inspection; and (v) restore
the Real Property and Improvements to the condition in which the same were found
before any such entry upon the Real Property and inspection or examination was
undertaken.
(b) Purchaser hereby indemnifies, defends and holds Seller and its
partners, agents, directors, officers, employees, successors and assigns
harmless from and against any and all liens, claims, causes of action, damages,
liabilities, demands, suits, obligations to third parties, together with all
losses, penalties, costs and expenses relating to any of the foregoing
(including but not limited to court costs and reasonable attorneys' fees)
arising out of any inspections, investigations, examinations, sampling or tests
conducted by Purchaser or any of the Licensee Parties, whether prior to or after
the date hereof, with respect to the Property or any violation of the provisions
of this Article V.
(c) In the event that Purchaser determines in its sole and
absolute discretion, after its inspection of the Documents and Real Property and
Improvements, that for any reason, or for no reason, Purchaser does not elect to
purchase the Property Purchaser shall have the right to terminate this Agreement
by providing written notice to Seller prior to the expiration of the Evaluation
Period, WITH TIME BEING OF THE ESSENCE WITH RESPECT THERETO. In the event
Purchaser terminates this Agreement in accordance with this Section 5.3(c), or
under any other right of termination as set forth herein, Purchaser shall have
the right to receive a refund of the Xxxxxxx Money Deposit, together with all
interest which has accrued thereon, and except with respect to the Termination
Surviving Obligations, this Agreement shall be null and void and the parties
shall have no further obligation to each other. In the event this Agreement is
terminated pursuant to this Section 5.3(c), Purchaser shall return to Seller all
copies Purchaser has made of the Documents and all copies of any studies,
reports or test results regarding any part of the Property obtained by
Purchaser, before or after the execution of this Agreement, in connection with
Purchaser's inspection of the Property (collectively, "PURCHASER'S INFORMATION")
promptly following the time this Agreement is terminated for any reason unless
Purchaser reasonably believes that it is prudent to retain one (1) copy of each
such document to establish any facts which might be the subject of a
post-termination dispute. If Purchaser so elects to retain one (1) such copy, it
shall so advise Seller, and Purchaser shall be responsible for maintaining the
confidentiality of such copy pursuant to the terms of this Agreement and the
Confidentiality Agreement.
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SECTION 5.4 SALE "AS IS". THE TRANSACTION CONTEMPLATED BY THIS
AGREEMENT HAS BEEN NEGOTIATED BETWEEN SELLER AND PURCHASER. THIS AGREEMENT
REFLECTS THE MUTUAL AGREEMENT OF SELLER AND PURCHASER, AND PURCHASER HAS THE
RIGHT TO CONDUCT ITS OWN INDEPENDENT EXAMINATION OF THE PROPERTY. OTHER THAN
THE MATTERS REPRESENTED IN SECTIONS 8.1 AND 8.3 HEREOF, BY WHICH ALL OF THE
FOLLOWING PROVISIONS OF THIS SECTION 5.4 ARE LIMITED, PURCHASER HAS NOT
RELIED UPON AND WILL NOT RELY UPON, EITHER DIRECTLY OR INDIRECTLY, ANY
REPRESENTATION, WARRANTY, COVENANT OR AGREEMENT OF SELLER OR ANY OF SELLER'S
AGENTS OR REPRESENTATIVES, AND PURCHASER HEREBY ACKNOWLEDGES THAT NO SUCH
REPRESENTATIONS HAVE BEEN MADE.
SELLER SPECIFICALLY DISCLAIMS, AND NEITHER IT NOR ANY OF ITS AFFILIATES
NOR ANY OTHER PERSON IS MAKING, ANY REPRESENTATION, WARRANTY OR ASSURANCE
WHATSOEVER TO PURCHASER, AND NO WARRANTIES OR REPRESENTATIONS OF ANY KIND OR
CHARACTER, EITHER EXPRESS OR IMPLIED, ARE MADE BY SELLER OR RELIED UPON BY
PURCHASER WITH RESPECT TO THE STATUS OF TITLE TO OR THE MAINTENANCE, REPAIR,
CONDITION, DESIGN OR MARKETABILITY OF THE PROPERTY, OR ANY PORTION THEREOF,
INCLUDING BUT NOT LIMITED TO (a) ANY IMPLIED OR EXPRESS WARRANTY OF
MERCHANTABILITY, (b) ANY IMPLIED OR EXPRESS WARRANTY OF FITNESS FOR A PARTICULAR
PURPOSE, (c) ANY IMPLIED OR EXPRESS WARRANTY OF CONFORMITY TO MODELS OR SAMPLES
OF MATERIALS, (d) ANY RIGHTS OF PURCHASER UNDER APPROPRIATE STATUTES TO CLAIM
DIMINUTION OF CONSIDERATION, (e) ANY CLAIM BY PURCHASER FOR DAMAGES BECAUSE OF
DEFECTS, WHETHER KNOWN OR UNKNOWN, WITH RESPECT TO THE IMPROVEMENTS OR THE
PERSONAL PROPERTY, (f) THE FINANCIAL CONDITION OR PROSPECTS OF THE PROPERTY AND
(g) THE COMPLIANCE OR LACK THEREOF OF THE REAL PROPERTY OR THE IMPROVEMENTS WITH
GOVERNMENTAL REGULATIONS, IT BEING THE EXPRESS INTENTION OF SELLER AND PURCHASER
THAT, EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, THE PROPERTY WILL BE
CONVEYED AND TRANSFERRED TO PURCHASER IN ITS PRESENT CONDITION AND STATE OF
REPAIR, "AS IS" AND "WHERE IS", WITH ALL FAULTS. PURCHASER REPRESENTS THAT IT IS
A KNOWLEDGEABLE, EXPERIENCED AND SOPHISTICATED PURCHASER OF REAL ESTATE, AND
THAT IT IS RELYING SOLELY ON ITS OWN EXPERTISE AND THAT OF PURCHASER'S
CONSULTANTS IN PURCHASING THE PROPERTY. PURCHASER HAS BEEN GIVEN A SUFFICIENT
OPPORTUNITY HEREIN TO CONDUCT AND HAS CONDUCTED OR WILL CONDUCT SUCH
INSPECTIONS, INVESTIGATIONS AND OTHER INDEPENDENT
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EXAMINATIONS OF THE PROPERTY AND RELATED MATTERS AS PURCHASER DEEMED NECESSARY,
INCLUDING BUT NOT LIMITED TO THE PHYSICAL AND ENVIRONMENTAL CONDITIONS THEREOF,
AND WILL RELY UPON SAME AND NOT UPON ANY STATEMENTS OF SELLER (EXCLUDING THE
LIMITED MATTERS REPRESENTED BY SELLER IN SECTION 8.1 HEREOF) NOR OF ANY OFFICER,
DIRECTOR, EMPLOYEE, AGENT OR ATTORNEY OF SELLER. PURCHASER ACKNOWLEDGES THAT ALL
INFORMATION OBTAINED BY PURCHASER WAS OBTAINED FROM A VARIETY OF SOURCES, AND
SELLER WILL NOT BE DEEMED TO HAVE REPRESENTED OR WARRANTED THE COMPLETENESS,
TRUTH OR ACCURACY OF ANY OF THE DOCUMENTS OR OTHER SUCH INFORMATION HERETOFORE
OR HEREAFTER FURNISHED TO PURCHASER. UPON CLOSING, PURCHASER WILL ASSUME THE
RISK THAT ADVERSE MATTERS, INCLUDING, BUT NOT LIMITED TO, ADVERSE PHYSICAL AND
ENVIRONMENTAL CONDITIONS, MAY NOT HAVE BEEN REVEALED BY PURCHASER'S INSPECTIONS
AND INVESTIGATIONS. PURCHASER ACKNOWLEDGES AND AGREES THAT UPON CLOSING, SELLER
WILL SELL AND CONVEY TO PURCHASER, AND PURCHASER WILL ACCEPT THE PROPERTY, "AS
IS, WHERE IS," WITH ALL FAULTS. PURCHASER FURTHER ACKNOWLEDGES AND AGREES THAT
THERE ARE NO ORAL AGREEMENTS, WARRANTIES OR REPRESENTATIONS, COLLATERAL TO OR
AFFECTING THE PROPERTY, BY SELLER OR ANY AGENT OF SELLER, OR BY ANY THIRD PARTY
ON BEHALF OF SELLER. SELLER IS NOT LIABLE OR BOUND IN ANY MANNER BY ANY ORAL OR
WRITTEN STATEMENTS, REPRESENTATIONS OR INFORMATION PERTAINING TO THE PROPERTY
FURNISHED BY ANY REAL ESTATE BROKER, AGENT, EMPLOYEE, SERVANT OR OTHER PERSON,
UNLESS THE SAME ARE SPECIFICALLY SET FORTH OR REFERRED TO HEREIN. PURCHASER
ACKNOWLEDGES THAT THE PURCHASE PRICE REFLECTS THE "AS IS, WHERE IS" NATURE OF
THIS SALE AND ANY FAULTS, LIABILITIES, DEFECTS OR OTHER ADVERSE MATTERS THAT MAY
BE ASSOCIATED WITH THE PROPERTY. PURCHASER, WITH PURCHASER'S COUNSEL, HAS FULLY
REVIEWED THE DISCLAIMERS AND WAIVERS SET FORTH IN THIS AGREEMENT AND UNDERSTANDS
THEIR SIGNIFICANCE AND AGREES THAT THE DISCLAIMERS AND OTHER AGREEMENTS SET
FORTH HEREIN ARE AN INTEGRAL PART OF THIS AGREEMENT, AND THAT SELLER WOULD NOT
HAVE AGREED TO SELL THE PROPERTY TO PURCHASER FOR THE PURCHASE PRICE WITHOUT THE
DISCLAIMERS AND OTHER AGREEMENTS SET FORTH IN THIS AGREEMENT. THE TERMS AND
CONDITIONS OF THIS SECTION 5.4 WILL EXPRESSLY SURVIVE THE CLOSING, WILL NOT
MERGE WITH THE PROVISIONS OF ANY CLOSING DOCUMENTS AND ARE HEREBY DEEMED
INCORPORATED INTO THE DEED AS FULLY AS IF SET FORTH AT LENGTH THEREIN.
15
SUBJECT TO THE PROVISIONS OF SECTIONS 8.1 AND 8.3 HEREOF, PURCHASER
FURTHER COVENANTS AND AGREES NOT TO XXX SELLER, AND RELEASES SELLER OF AND FROM
AND WAIVES ANY CLAIM OR CAUSE OF ACTION THAT PURCHASER MAY HAVE AGAINST THE
SELLER UNDER ANY ENVIRONMENTAL LAW, NOW EXISTING OR HEREAFTER ENACTED OR
PROMULGATED, RELATING TO ENVIRONMENTAL MATTERS OR ENVIRONMENTAL CONDITIONS IN,
ON, UNDER, ABOUT OR MIGRATING FROM OR ONTO THE PROPERTY, INCLUDING WITHOUT
LIMITATION, THE COMPREHENSIVE ENVIRONMENTAL RESPONSE, COMPENSATION AND LIABILITY
ACT, OR BY VIRTUE OF ANY COMMON LAW RIGHT RELATED TO ENVIRONMENTAL CONDITIONS OR
ENVIRONMENTAL MATTERS IN, ON, UNDER, ABOUT OR MIGRATING FROM OR ONTO THE
PREMISES. THE PROVISIONS OF THIS PARAGRAPH SHALL SURVIVE THE CLOSING OF TITLE TO
THE PROPERTY OR THE TERMINATION OF THIS AGREEMENT, AS THE CASE MAY BE.
ARTICLE VI
TITLE AND SURVEY MATTERS
SECTION 6.1 SURVEY. Purchaser acknowledges receipt of the Existing Survey,
and that Purchaser has reviewed and accepted all of the matters shown on the
Existing Survey. Any modification, update or recertification of the Existing
Survey shall be at Purchaser's election and sole cost and expense. The Existing
Survey together with any update Purchaser has elected to obtain, if any, is
herein referred to as the "UPDATED SURVEY". Purchaser agrees to provide Seller
with notice of any objection to the matters shown on the Existing Survey within
seven (7) Business Days following the Effective Date (the "SURVEY OBJECTIONS").
In the event that the Updated Survey sets forth any survey matters which are
objectionable to Purchaser and which were not shown on the Existing Survey, then
Purchaser agrees to provide Seller with notice of such objections within seven
(7) Business Days of the receipt of the Updated Survey, and such objections
shall also be deemed to be Survey Objections. Purchaser agrees to cause the
party preparing the Updated Survey to provide two (2) copies of same to Seller's
counsel simultaneous with the delivery of the Updated Survey to Purchaser.
SECTION 6.2 TITLE COMMITMENT.
(a) Purchaser acknowledges receipt of that certain title insurance
commitment issued by First American Title Insurance Company of New York under
Commitment No. 135-NJ-29480-1 together with copies of the title exceptions
listed thereon, that Purchaser has reviewed and accepted all matters shown
therein, other than the requirements set forth at Schedule B-Section I h. and n.
therein, and the items set forth at Schedule B-Section II items 1-7 and 9
therein, and that such matters constitute Permitted Exceptions. By the date (the
"NEW OBJECTION DATE") which is five (5)
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Business Days after Purchaser's counsel receives a new title commitment from the
Title Company (the "TITLE COMMITMENT"), Purchaser shall provide Seller with
written notice of any objections raised in such Title Commitment which are not
Permitted Exceptions and which Purchaser deems unacceptable ("TITLE
OBJECTIONS"). If Purchaser's counsel receives notice of any new objection or
exception with less than five (5) Business Days prior to the Scheduled Closing
Date, then (x) the Closing shall be postponed for a sufficient number of days in
order for Purchaser's counsel to have five (5) Business Days to review said new
objection or exception and to advise Seller if Purchaser deems same unacceptable
and (y) the balance of this Agreement shall apply with respect to Seller's right
to cure same. In the event Seller does not receive the Title Objections by the
New Objection Date, Purchaser will be deemed to have accepted as Permitted
Exceptions the exceptions to title set forth on the Title Commitment and any
updates thereto. Purchaser shall cause the Title Company to furnish to Purchaser
and Seller's counsel a preliminary title report or Title Commitment, by the
terms of which the Title Company agrees to issue to Purchaser at Closing, at
Purchaser's sole cost and expense an owner's policy of title insurance (the
"TITLE POLICY") in the amount of the Purchase Price on the then standard ALTA
owner's form insuring Purchaser's fee simple title to the Real Property, subject
to the terms of such policy and the exceptions described therein (including,
without limitation, the standard or general exceptions). Subject to this Section
6.2(a), all matters shown on the Existing Survey and the exceptions shown on
EXHIBIT G (collectively, the "PERMITTED EXCEPTIONS") are conclusively deemed to
be acceptable to Purchaser.
(b) All taxes, water rates or charges, sewer rents and
assessments, plus interest and penalties thereon, which on the Closing Date are
liens against the Real Property and which Seller is obligated to pay and
discharge will be credited against the Purchase Price (subject to the provision
for apportionment of taxes, water rates and sewer rents herein contained) and
shall not be deemed a Title Objection. If on the Closing Date there shall be
security interests filed against the Real Property, such items shall not be
Title Objections if (i) the personal property covered by such security interests
are no longer in or on the Real Property, or (ii) such personal property is the
property of a Tenant, or the security interest has expired under applicable law.
If the personal property is no longer in or on the Real Property or is the
property of a Tenant, Seller shall execute and deliver an affidavit to such
effect, which affidavit shall include an indemnification in favor of Purchaser
and the Title Company against any loss, cost or expense related thereto if
Seller's affidavit is incorrect.
(c) If on the Closing Date the Real Property shall be affected by
any lien which, pursuant to the provisions of this Agreement, is required to be
discharged or satisfied by Seller, Seller shall not be required to discharge or
satisfy the same of record provided the money necessary to satisfy the lien is
retained by the Title Company at Closing, and the Title Company omits the lien
as an exception from the title insurance commitment, and a credit is given to
Purchaser for the recording charges for a satisfaction or discharge of such
lien.
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(d) No franchise, transfer, inheritance, income, corporate or
other tax open, levied or imposed against Seller or any former owner of the
Property, that may be a lien against the Property on the Closing Date, shall be
an objection to title if the Title Company omits the lien as an exception from
the title insurance commitment and provided further that Seller deposits with
the Title Company a sum reasonably sufficient to secure a release of the
Property from the lien thereof. If a search of title discloses judgments,
bankruptcies, or other returns against other persons having names similar to
that of Seller, Seller will deliver to Purchaser an affidavit stating that such
judgments, bankruptcies or other returns do not apply to Seller, and such search
results shall not be deemed Title Objections.
(e) In the event that the Title Company is not prepared to insure
title to the Real Property in the manner provided in this Agreement and Seller
is able to obtain a commitment from one or more of First American Title
Insurance Company of New York, Chicago Title Insurance Company, Commonwealth
Land Title Insurance Company or Lawyer's Title Insurance Company to insure title
in the manner required in this Agreement, Seller shall be entitled to cause any
one or more of such companies to so insure Purchaser's title.
SECTION 6.3 TITLE DEFECT.
(a) In the event Seller receives any Survey Objection or Title
Objection (collectively and individually, a "TITLE DEFECT") within the time
periods required under Sections 6.1 and 6.2 above, Seller may elect (but shall
not be obligated) to attempt to remove, or cause to be removed at its expense,
any such Title Defect, and shall provide Purchaser with notice, within seven (7)
days of its receipt of any such objection, of its intention to cure such any
such Title Defect. If Seller elects to attempt to cure any Title Defect, it
shall do so in a prompt and diligent manner, and the Closing Date shall be
extended for one or more periods not to exceed in the aggregate sixty (60) days,
for the purpose of such removal. In the event that (i) Seller elects not to
attempt to cure any such Title Defect, or (ii) Seller is unable to cure any such
Title Defect for any period elected by Seller but not to exceed sixty (60) days
from the Closing Date, Seller shall so advise Purchaser and Purchaser shall have
the right to terminate this Agreement and receive a refund of the Xxxxxxx Money
Deposit, together with all interest which has accrued thereon, or to waive such
Title Defect and proceed to the Closing. Purchaser shall make such election
within ten (10) days of receipt of Seller's notice. If Purchaser elects to
proceed to the Closing, any Title Defects waived by Purchaser shall be deemed
Permitted Exceptions. In addition to the remedies provided in this Section
6.3(a), if a Title Defect is caused by a written document executed by Seller in
recordable form at any time on or after the effective date of the Title
Commitment, which document has not been approved or deemed approved by
Purchaser, then Seller shall also reimburse Purchaser for its title, survey,
consultants and attorneys' fees and expenses reasonably incurred by Purchaser
hereunder, as documented by Purchaser.
18
(b) Notwithstanding any provision of this Article VI to the
contrary, Seller will be obligated to cure exceptions to title to the Property,
in the manner described above, relating to liens and security interests securing
any financings to Seller, and any mechanic's liens resulting from work at the
Property commissioned by Seller, and any other encumbrances placed of record by
Seller on or after the Effective Date which may be satisfied by the payment of a
sum certain.
ARTICLE VII
INTERIM OPERATING COVENANTS,
ESTOPPELS, BOARD APPROVAL
SECTION 7.1 INTERIM OPERATING COVENANTS. Seller covenants to Purchaser
that Seller will:
(a) OPERATIONS. From the Effective Date until Closing, continue to
operate, manage and maintain the Improvements in the ordinary course of Seller's
business and substantially in accordance with Seller's present practice, subject
to ordinary wear and tear and further subject to Article XI of this Agreement.
(b) COMPLIANCE WITH GOVERNMENTAL REGULATIONS. From the Effective
Date until Closing, not take any action that would result in a failure to comply
in all material respects with all Governmental Regulations applicable to the
Property, it being understood and agreed that prior to Closing, Seller will have
the right to contest any such Governmental Regulations.
(c) SERVICE CONTRACTS. From the expiration of the Evaluation
Period until Closing, not enter into any service contract other than in the
ordinary course of business, unless such service contract is terminable on
thirty (30) days notice without penalty or unless Purchaser consents thereto in
writing, which approval will not be unreasonably withheld, delayed or
conditioned.
(d) NOTICES. To the extent received by Seller, from the Effective
Date until Closing, promptly deliver to Purchaser copies of written default
notices, notices of lawsuits and notices of violations affecting the Property.
(e) NTT LEASE EXTENSION. Attempt to obtain an extension (the "NTT
LEASE EXTENSION") with NTT Data Communications Systems Corporation ("NTT") of
the current lease with NTT at the Property, providing for NTT to extend such
lease for a period of ten (10) years commencing October 1, 2005 and expiring
September 30, 2015, on the terms and conditions set forth on EXHIBIT K and such
other terms and conditions reasonably acceptable to Purchaser. Each party's
agreement with respect to obtaining the NTT Lease Extension is more particularly
set forth in Section 7.4(a) below.
(f) FINANCING AGREEMENT. Cooperate with Purchaser in preparing and
prosecuting all necessary applications to be submitted to the City in order to
obtain
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the consent of the City to the assignment and assumption of that certain
Amendment and Assignment of Financial Agreement (the "FINANCING AGREEMENT")
dated April 17, 1999 between Cali-Grove Street Urban Renewal Associates L.P. and
the City, to an affiliate of Purchaser which satisfies the requirements of
applicable law to be an assignee of the Financing Agreement, and to an
assignment or change in the ownership of the Project (as such term is defined in
the Financing Agreement) [collectively, the "CITY CONSENT"]. Such cooperation
shall include, at Purchaser's election, having a primary role in seeking to
obtain the City Consent.
SECTION 7.2 ESTOPPELS. It will be a condition to Closing that Seller
obtain from each Major Tenant an executed estoppel certificate in the form
prescribed by the Lease for each such Major Tenant. Notwithstanding the
foregoing, Seller agrees that promptly following Purchaser's waiver of its right
to terminate this Agreement pursuant to Section 5.3, Seller shall request that
each Tenant execute an estoppel certificate in the form reasonably requested by
Purchaser and annexed hereto as EXHIBIT H. Seller shall not be in default of its
obligations hereunder if any Tenant fails to deliver an estoppel certificate, or
delivers an estoppel certificate which is not in accordance with this Agreement.
In the event Seller is unable to obtain an executed estoppel certificate
in the form of Exhibit H for each Tenant, Seller may, but is not obligated to,
provide an estoppel certificate in the form prescribed by the Lease for each
such Tenant, which Purchaser agrees to accept as a valid and binding estoppel
certificate.
If Seller is unable to obtain an original copy or re-executed original
copy of the lease with DLJ Securities Corporation dated July 1, 1987, then
Seller shall request that such tenant attach said lease to its estoppel letter,
and that each page be initialed by such tenant; delivery of such estoppel
letter, with such attachment, shall be a condition precedent to Purchaser's
obligations hereunder. Similarly, if Seller is unable to obtain a copy of the
letter agreement with Combined Data Resource, Inc. dated July 18, 1991, then
Seller shall request that such tenant attach said letter to its estoppel letter
and initial same; delivery of such estoppel letter, with such attachment, shall
be a condition precedent to Purchaser's obligations hereunder.
SECTION 7.3 BOARD APPROVAL. (a) It will be a condition to Closing that
Seller obtain approval from its Board of Directors to proceed to Closing. Seller
shall make such solicitations from its Board of Directors so that within fifteen
(15) days following the Effective Date, Seller's Board of Directors shall have
approved or denied its approval to the transaction contemplated herein. Failure
by Seller to obtain said approval shall not be deemed a default hereunder. In
the event Seller's Board of Directors denies approval to proceed to Closing,
this Agreement shall be deemed terminated and of no further force and effect,
except for the Termination Surviving Obligations, which shall survive any such
termination. Seller will give Purchaser prompt notice, following the expiration
of the fifteen (15) day period provided above, as to the approval or denial by
the Board of Directors of Seller.
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(b) It will be a condition to Closing that Purchaser obtain
approval from its Board of Directors to proceed to Closing. Purchaser shall make
such solicitations from its Board of Directors so that within fifteen (15) days
following the Effective Date, Purchaser's Board of Directors shall have approved
or denied its approval to the transaction contemplated herein. Failure by
Purchaser to obtain said approval shall not be deemed a default hereunder. In
the event Purchaser's Board of Directors denies approval to proceed to Closing,
this Agreement shall be deemed terminated and of no further force and effect,
except for the Termination Surviving Obligations, which shall survive any such
termination. Purchaser will give Seller prompt notice, following the expiration
of the fifteen (15) day period provided above, as to the approval or denial by
the Board of Directors of Purchaser.
SECTION 7.4 PURCHASER'S OBLIGATIONS DURING CONTRACT PERIOD:
(a) NTT LEASE EXTENSION. Within five (5) Business Days following
Seller's delivery to Purchaser of a proposed NTT Lease Extension, Purchaser
agrees to provide Seller with all of its comments thereto. Purchaser agrees not
to unreasonably withhold or condition its approval of the NTT Lease Extension
proposed by Seller, provided the proposed NTT Lease Extension is in conformity
with Section 7.1(e). In the event that Purchaser does not advise Seller of any
comments thereto within the period specified, TIME BEING OF THE ESSENCE,
Purchaser shall be deemed to have approved of same, otherwise, Purchaser shall
be deemed to have rejected same. In the event Purchaser advises Seller of any
comments to the proposed NTT Lease Extension and Seller is unable to incorporate
Purchaser's comments thereto or Seller advises Purchaser that NTT shall not
agree to same, then the parties shall proceed to the Closing in accordance with
the terms and conditions of this Agreement and without any requirements to
obtain the NTT Lease Extension, and the Purchase Price due at Closing shall be
reduced as provided in Section 3.4. In the event that Seller obtains a NTT Lease
Extension executed by NTT, then as part of the Assignment of Leases, Purchaser
shall assume the NTT Lease Extension. In addition, Purchaser shall be obligated
to pay the Outside Brokers (as defined in Exhibit C of the Leasing and
Management Agreement), on account of the NTT Lease Extension, up to a maximum
amount of One Million Six Hundred Forty-Five Thousand Dollars ($1,645,000) in
leasing commissions, and any leasing commissions to Outside Brokers in excess of
such amount shall be paid by Seller (in the event of such excess, then Seller
shall also obtain an agreement from the brokers entitled to any excess
commission that Purchaser shall have no responsibility for same). Purchaser
shall also be obligated to pay a leasing commission to the Agent under the
Leasing and Management Agreement, on account of the NTT Lease Extension, as
follows: (i) if, during the first ninety (90) days after the Closing, Seller or
Agent is a procuring party in obtaining the NTT Lease Extension, then neither
Seller nor any of its affiliates shall be entitled to any brokerage commission
in connection with the NTT Lease Extension; (ii) if, during the one hundred and
eighty (180) days after the expiration of said ninety (90) day period, Seller or
Agent is a procuring party in obtaining the NTT Lease Extension, then the
percentage to be used in calculating the amount due Agent in accordance with
Section 2(b) of Exhibit C of the Leasing and Management Agreement
21
shall be 1.60%; and (iii) if, after the expiration of said one hundred and
eighty (180) day period, Seller or Agent is a procuring party in obtaining the
NTT Lease Extension, then the percentage to be used in calculating the amount
due Agent in accordance with Section 2(b) of Exhibit C of the Leasing and
Management Agreement shall be 2.0%.
(b) FINANCING AGREEMENT. Purchaser shall cooperate with Seller in
preparing and prosecuting all necessary applications to be submitted to the City
in order to obtain the City Consent. In connection therewith, Purchaser agrees
that the entity to be the assignee of the Financing Agreement and the owner of
the Project shall be an entity satisfying the requirements of applicable law,
including without limitation, the New Jersey Long Term Tax Exemption Law,
N.J.S.A. 40A;20-1 ET SEQ., and that the applications shall be made in accordance
with applicable laws. Purchaser agrees to use commercially reasonable efforts to
complete such applications and form the necessary entities, prior to Purchaser's
waiver of its right to terminate this Agreement in accordance with Section 5.3
so that promptly following such waiver, Purchaser and Seller shall jointly
prosecute such applications.
(c) SERVICE CONTRACTS. During the Evaluation Period, Purchaser
shall have the right to cause Seller to terminate any Service Contracts which
are terminable either without payment of a fee, or with payment of a fee which
Purchaser shall pay to Seller at the Closing. Purchaser must make such election
prior to the expiration of the Evaluation Period, TIME BEING OF THE ESSENCE.
Purchaser acknowledges that it shall not have the right to elect to have
terminated any Service Contracts that are for a stated period longer than one
(1) year, such as by way of example and not limitation, any Service Contracts
providing for maintenance of the elevators at the Improvements.
ARTICLE VIII
REPRESENTATIONS AND WARRANTIES
SECTION 8.1 SELLER'S REPRESENTATIONS AND WARRANTIES. The following
constitute the sole representations and warranties of Seller, which
representations and warranties shall be true as of the Effective Date. Subject
to the limitations set forth in Section 8.3 of this Agreement, Seller represents
and warrants to Purchaser the following:
(a) STATUS. Each Seller is a limited partnership, duly organized
and validly existing under the laws of the State of New Jersey.
(b) AUTHORITY. Subject to Section 7.3(a) above, (i) the execution
and delivery of this Agreement and the performance of Seller's obligations
hereunder have been or will be duly authorized by all necessary action on the
part of Seller, and this Agreement constitutes the legal, valid and binding
obligation of Seller, and (ii) no consent, waiver, approval or authorization is
required from any person or entity (that has not already been obtained) in
connection with the execution and delivery of this Agreement by Seller or the
performance by Seller of the transactions contemplated hereby.
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(c) NON-CONTRAVENTION. The execution and delivery of this
Agreement by Seller and the consummation by Seller of the transactions
contemplated hereby will not violate any judgment, order, injunction, decree,
regulation or ruling of any court or Authority or conflict with, result in a
breach of, or constitute a default under the organizational documents of Seller,
any note or other evidence of indebtedness, any mortgage, deed of trust or
indenture, or any lease or other material agreement or instrument to which
Seller is a party or by which it is bound.
(d) SUITS AND PROCEEDINGS. To Seller's Knowledge, except as listed
in EXHIBIT I (the "SECAUCUS LITIGATION"), there are no legal actions, suits or
similar proceedings pending and served, or threatened against Seller or the
Property which (i) are not adequately covered by existing insurance and (ii) if
adversely determined, would affect, in other than a DE MINIMIS manner, the value
of the Property, the continued operations thereof, or Seller's ability to
consummate the transactions contemplated hereby. MCRLP (as defined in Section
20.1) agrees to reimburse Purchaser for any amounts for which Purchaser is
liable, or which constitute a lien against the Property, in connection with the
Secaucus Litigation, to the extent same is on account of any period prior to the
Closing Date, but subject to the balance of this paragraph. Seller shall
continue to defend, at Seller's expense, the Secaucus Litigation from and after
the Closing (to the extent litigation arises with respect to any period
following the Closing, Purchaser will defend same at its sole cost). In the
event Purchaser incurs any expenses on account of the Secaucus Litigation for a
period prior to the Closing Date, then prior to it seeking reimbursement from
Seller, Purchaser shall use commercially reasonable efforts to collect such
payment, or an allocable portion, from those Tenants who are obligated for such
expenses, or a portion thereof, based upon their Lease and their date of
occupancy at the Property. In the event that any amounts are due with respect to
tenants which are no longer at the Property, MCRLP shall promptly pay over such
amounts to Purchaser; with respect to existing Tenants, MCRLP shall pay such
amounts to Purchaser if, within one hundred twenty (120) days of Purchaser
rendering a xxxx to such Tenant and pursuing collection thereof, such Tenant
shall fail to pay same. Seller shall have the right to bring suit, and take such
other action as is commercially reasonable, to collect any amounts owed from any
existing Tenants, or past tenants related to the Secaucus Litigation, and
Purchaser shall reasonably cooperate with Seller in such regard.
Seller hereby acknowledges that Purchaser may retain Waters,
McPherson, XxXxxxx to represent Purchaser in any future legal actions or
proceedings similar to the Secaucus Litigation, and Purchaser acknowledges that
such firm may continue to represent Seller in the Secaucus Litigation or such
future litigation. Each party hereby waives any conflict which may arise from
such representation. This Section 8.1(d) shall survive closing.
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(e) NON-FOREIGN ENTITY. Seller is not a "foreign person" or
"foreign corporation" as those terms are defined in the Internal Revenue Code of
1986, as amended, and the regulations promulgated thereunder.
(f) TENANTS. As of the date of this Agreement, the only tenants of
the Property are the tenants set forth in the Lease Schedule listed on EXHIBIT
F. In the event that any of the Leases sets forth terms which are contrary to
that which is contained in the Lease Schedule, the terms of the Lease shall
control. The Documents made available to Purchaser pursuant to Section 5.2
hereof include true and correct copies of all of the Leases listed on EXHIBIT F.
Seller has not received any notice from any Tenants which remain uncured,
alleging that Seller is in default of any Leases. In addition, Seller has not
sent any default notices to any of the Tenants which remain uncured.
(g) SERVICE CONTRACTS. Seller has paid, or will pay in the normal
course after Closing, all amounts due prior to Closing under the Service
Contracts, and to Seller's Knowledge, Seller is not in default under any Service
Contract. To Seller's Knowledge, none of the service providers listed on EXHIBIT
E is in default under any Service Contract and the Service Contracts are in full
force and effect. The Documents made available to Purchaser pursuant to Section
5.2 hereof include copies of all Service Contracts listed on EXHIBIT E under
which Seller is currently paying for services rendered in connection with the
Property, and there are no other contracts or agreements pursuant to which
service providers are providing services to the Property on a regular or
periodic basis.
(h) LEASES. The Leases initialed by representatives of Purchaser
and Seller on or prior to the Effective Date are true, correct, and complete
copies of the documents described on the Lease Schedule. Other than the
tenancies under the Leases, there are presently no tenancies affecting the
Property.
(i) ENVIRONMENTAL MATTERS. Except as set forth in the
Environmental Report, or as may otherwise be disclosed to Purchaser in writing,
to Seller's Knowledge, there is no Hazardous Substances at the Property except
those in compliance with all applicable Environmental Laws.
(j) GROUND LEASE. The Ground Lease is unmodified and in full force
and effect, and there is no default thereunder. Seller has delivered a true and
complete copy of the Ground Lease to Purchaser prior to the date hereof.
(k) KEY INDIVIDUALS. The Key Individuals are the officers and
employees of Xxxx-Xxxx Realty Corporation or Seller who have significant
responsibilities with respect to the Property. The Key Individuals (other than
Xxx Xxxxx) have been officers of Xxxx-Xxxx Realty Corporation for at least the
past two (2) years.
(l) BROKERAGE COMMISSIONS. The only agreements with brokers for
whom leasing commissions are or may be due and payable with respect to any of
the
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Leases are set forth on EXHIBIT N. The parties' respective obligations with
respect to the Brokerage Commission Agreements are set forth in Section 10.4(e).
(m) CONDEMNATION. There are no condemnation proceedings either
instituted or, to Seller's Knowledge planned to be instituted, affecting the
Property, nor are there any special assessment proceedings pending, or, to
Seller's Knowledge, threatened, for the Property.
(n) EMPLOYEES. No person who is employed in connection with the
management, operation or maintenance of the Property and who will become the
obligation of Purchaser after the Closing is covered by an employment agreement
or a union contract, and none of the employment arrangements with respect to the
employees will be binding on Purchaser after Closing. Notwithstanding the
foregoing, Purchaser acknowledges that one of the Service Contracts includes a
contract with Xxxxxx Service Corporation ("Xxxxxx"), pursuant to which Xxxxxx
employs employees holding the positions set forth on Exhibit Q or other
individuals, and that the contract with Xxxxxx will remain as an obligation of
Purchaser after Closing.
(o) ERISA. The Property is not a "plan asset" within the meaning
of that term under any regulations promulgated under the Employee Retirement and
Income Security Act of 1974, as amended.
SECTION 8.2 PURCHASER'S REPRESENTATIONS AND WARRANTIES. Purchaser
represents and warrants to Seller the following:
(a) STATUS. CLI is a duly organized and validly existing
corporation under the laws of the Federal Republic of Germany and Germania is a
duly organized and validly existing corporation organized under the laws of the
State of Georgia.
(b) AUTHORITY. Subject to Section 7.3(b) above, the execution and
delivery of this Agreement and the performance of Purchaser's obligations
hereunder have been duly authorized by all necessary action on the part of
Purchaser and this Agreement constitutes the legal, valid and binding obligation
of Purchaser.
(c) NON-CONTRAVENTION. The execution and delivery of this
Agreement by Purchaser and the consummation by Purchaser of the transactions
contemplated hereby will not violate any judgment, order, injunction, decree,
regulation or ruling of any court or Authority or conflict with, result in a
breach of or constitute a default under the organizational documents of
Purchaser, any note or other evidence of indebtedness, any mortgage, deed of
trust or indenture, or any lease or other material agreement or instrument to
which Purchaser is a party or by which it is bound.
(d) CONSENTS. No consent, waiver, approval or authorization is
required from any person or entity (that has not already been obtained) in
connection with
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the execution and delivery of this Agreement by Purchaser or the performance by
Purchaser of the transactions contemplated hereby.
SECTION 8.3 SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS.
The representations and warranties of Seller set forth in Section 8.1, and the
covenants of Seller set forth in Section 7.1, will survive the Closing for a
period of twelve (12) months provided, however, that all of the limitations set
forth in this Section 8.3 shall not apply to the Secaucus Litigation, as set
forth in Section 8.1(d), and the obligations and liabilities of MCRLP
thereunder, which obligations and liabilities shall be an independent Closing
Surviving Obligation. Purchaser will not have any right to bring any action
against Seller as a result of any untruth or inaccuracy of such representations
and warranties, or any such breach, unless and until the aggregate amount of all
liability and losses arising out of any such untruth or inaccuracy, or any such
breach, exceeds One Hundred Thousand Dollars ($100,000); and then only to the
extent of such excess. In addition, in no event will Seller's liability for all
such breaches exceed, in the aggregate, the sum of Two Million Five Hundred
Dollars ($2,500,000). Seller shall have no liability with respect to any of
Seller's representations, warranties and covenants herein if, prior to the
Closing, Purchaser has knowledge (from whatever source, including, without
limitation, any tenant estoppel certificates, as a result of Purchaser's due
diligence tests, investigations and inspections of the Property, or written
disclosure by Seller or Seller's agents and employees) of any breach of a
covenant of Seller herein, or if the officers and employees of Purchaser
primarily responsible for this transaction have actual knowledge (as opposed to
constructive or imputed knowledge) or obtain knowledge that contradicts any of
Seller's representations, warranties and covenants herein, and Purchaser
nevertheless consummates the transaction contemplated by this Agreement. For the
twelve (12) month period following Closing, Grove Street Associates of Jersey
City Limited Partnership agrees to maintain assets having a net worth of at
least $4,000,000; in the event that such entity does not maintain such assets,
then MCRLP shall guaranty the obligations of Seller pursuant to this Section
8.3. The Closing Surviving Obligations and the Termination Surviving Obligations
will survive Closing without limitation unless a specified period is otherwise
provided in this Agreement. All other representations, warranties, covenants and
agreements made or undertaken by Seller under this Agreement, unless otherwise
specifically provided herein, will not survive the Closing Date but will be
merged into the Deed and other Closing documents delivered at the Closing.
ARTICLE IX
CONDITIONS PRECEDENT TO CLOSING
SECTION 9.1 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 Closing Date of all of the following
conditions, any or all of which may be waived by Purchaser in its sole
discretion:
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(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 10.3.
(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
Closing Date (with only appropriate modifications permitted under this
Agreement).
(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 Closing Date.
(d) The City shall have given the City Consent.
SECTION 9.2 CONDITIONS PRECEDENT TO OBLIGATION TO SELLER. The obligation
of Seller to consummate the transaction hereunder shall be subject to the
fulfillment on or before the Closing Date of all of the following conditions,
any or all of which may be waived by Seller in it sole discretion:
(a) Seller shall have received the Purchase Price as adjusted
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 10.2.
(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 Closing Date (with any appropriate modifications permitted under this
Agreement).
(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 Closing Date.
(e) The City shall have given the City Consent.
SECTION 9.3 FAILURE OF A CONDITION PRECEDENT. (a) In the event that all of
the conditions to Closing as set forth in Section 9.1 have not been either
satisfied, or waived by Purchaser, prior to the Closing Date, Purchaser may, at
any time thereafter while any such condition remains unsatisfied, terminate this
Agreement upon five (5) Business Days notice to Seller, whereupon Purchaser will
receive from the Escrow Agent the Xxxxxxx Money Deposit, together with all
interest accrued thereon, and thereafter Seller and Purchaser will have no
further rights or obligations under this Agreement, except with respect to the
Termination Surviving Obligations.
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(b) In the event that all of the conditions to Closing as set
forth in Section 9.2 have not been either satisfied, or waived by Seller, prior
to the Closing Date, Seller may, at any time thereafter while any such condition
remains unsatisfied, terminate this Agreement upon five (5) Business Days notice
to Purchaser, whereupon Purchaser will receive from the Escrow Agent the Xxxxxxx
Money Deposit, together with all interest accrued thereon, and thereafter Seller
and Purchaser will have no further rights or obligations under this Agreement,
except with respect to the Termination Surviving Obligations.
(c) The rights of Section 9.3(a) and (b) are not in limitation of
either party's rights set forth in Section 13 in the event of a default by
Seller or Purchaser, respectively.
ARTICLE X
CLOSING
SECTION 10.1 CLOSING. The consummation of the transaction contemplated by
this Agreement by delivery of documents and, except as set forth in the next
sentence, payments of money (subject to Section 3.3) shall take place at 10:00
a.m. Eastern Time on the Closing Date at the offices of Seller's counsel, Xxxxx
Xxxxxxx Xxxxxxx & Xxxxx LLP, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000. At
Purchaser's election given at least three (3) Business Days prior to the Closing
Date, Seller's counsel shall attend a closing of any purchase money financing
obtained by Purchaser in connection with the acquisition of the Property;
provided, however, neither the availability of such financing, nor any closing
with respect thereto, shall be a condition to Purchaser's obligation to close,
nor shall the Closing hereunder, but for the payment of money, be held at any
office other than Seller's counsel. At Closing, the events set forth in this
Article X will occur, it being understood that the performance or tender of
performance of all matters set forth in this Article X are mutually concurrent
conditions which may be waived by the party for whose benefit they are intended.
The acceptance of the Deed by Purchaser shall be deemed to be full performance
and discharge of each and every representation and warranty made by Seller
herein, and every agreement and obligation on the part of the Seller to be
performed hereunder, except those which are specifically stated herein to
survive the Closing.
SECTION 10.2 PURCHASER'S CLOSING OBLIGATIONS. On the Closing Date,
Purchaser, at its sole cost and expense, will deliver the following items to
Seller at Closing as provided herein:
(a) The Purchase Price, after all adjustments are made as herein
provided, by Federal Reserve wire transfer of immediately available funds, in
accordance with the timing and other requirements of Section 3.3;
(b) A counterpart original of the Assignment of Leases, duly
executed by Purchaser;
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(c) A counterpart original of the Assignment, duly executed by
Purchaser;
(d) Evidence reasonably satisfactory to Seller that the person
executing the Assignment of Leases, the Assignment, and the Tenant Notice
Letters on behalf of Purchaser has full right, power and authority to do so;
(e) Written notice, in the form of EXHIBIT O, executed by
Purchaser and to be addressed and delivered to the Tenants by Purchaser in
accordance with Section 10.6 herein, (i) acknowledging the sale of the Property
to Purchaser, (ii) acknowledging that Purchaser has received and that Purchaser
is responsible for the Security Deposit (specifying the exact amount of the
Security Deposit) and (iii) indicating that rent should thereafter be paid to
Purchaser and giving instructions therefor (the "TENANT NOTICE LETTERS");
(f) A counterpart original of the Closing Statement, duly executed
by Purchaser;
(g) Counterpart originals of the transfer tax declarations, each
duly executed by Purchaser;
(h) A certificate, dated as of the date of Closing, stating that
the representations and warranties of Purchaser contained in Section 8.2 are
true and correct in all material respects as of the Closing Date (with
appropriate modifications to reflect any changes therein) or 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
Purchaser be liable to Seller for, or be deemed to be in default hereunder if
any representation or warranty is not true and correct in all material respects;
PROVIDED, HOWEVER, that such event shall constitute the non-fulfillment of the
condition set forth in Section 9.2(c). If, despite changes or other matters
described in such certificate, the Closing occurs, Purchaser's representations
and warranties set forth in this Agreement shall be deemed to have been modified
by all statements made in such certificate;
(i) A Leasing and Management Agreement substantially in the form
of Exhibit L annexed hereto;
(j) A mortgagor's affidavit in form and substance reasonably
acceptable to Purchaser if Purchaser obtains purchase money mortgage financing
to consummate the transaction contemplated by this Agreement, and such other
affidavits or instruments customarily required in order to remove the items set
forth on Schedule B-Section II, 1-8 on the title report referenced in the first
sentence of Section 6.2(a); and
29
(k) Such other documents as may be reasonably necessary or
appropriate to effect the consummation of the transaction which is the subject
of this Agreement.
SECTION 10.3 SELLER'S CLOSING OBLIGATIONS. At the Closing, Seller, at its
sole cost and expense, will deliver to Purchaser the following documents:
(a) A bargain and sale deed with covenants against grantor's acts,
or the local equivalent, (the "DEED"), duly executed and acknowledged by Seller,
conveying to the Purchaser the Real Property and the Improvements subject only
to the Permitted Exceptions;
(b) A blanket assignment and xxxx of sale in the form attached
hereto as EXHIBIT C (the "XXXX OF SALE"), duly executed by Seller, assigning and
conveying to Purchaser, without representation or warranty, title to the
Personal Property;
(c) A counterpart original of an assignment and assumption of the
Seller's interest, as lessor, in the Leases and Security Deposits in the form
attached hereto as EXHIBIT B (the "ASSIGNMENT OF LEASES"), duly executed by
Seller, conveying and assigning to Purchaser all of Seller's right, title and
interest, as sublessor, in the Leases and Security Deposits;
(d) A counterpart original of an assignment and assumption of
Seller's interest in the Service Contracts and the Licenses and Permits in the
form attached hereto as EXHIBIT A (the "ASSIGNMENT"), duly executed by Seller,
conveying and assigning to Purchaser all of Seller's right, title, and interest,
if any, in the Service Contracts and the Licenses and Permits;
(e) The Tenant Notice Letters, duly executed by Seller;
(f) Evidence reasonably satisfactory to Purchaser and Title
Company that the person executing the documents delivered by Seller pursuant to
this Section 10.3 on behalf of Seller has full right, power, and authority to do
so;
(g) A certificate in the form attached hereto as EXHIBIT J
("CERTIFICATE AS TO FOREIGN STATUS") certifying that Seller is not a "foreign
person" as defined in Section 1445 of the Internal Revenue Code of 1986, as
amended, as well as any form or other document required under applicable laws to
be executed by Seller in connection with any transfer tax applicable to the
transaction contemplated by this Agreement;
(h) The Ground Lease, Leases, and all original Licenses and
Permits and Service Contracts in Seller's control bearing on the Property.
Seller shall deliver originals of the Ground Lease and those Leases which are
marked as originals on Exhibit F, and (i) if Seller is unable to obtain an
original copy, or re-executed original copy, of
30
the Lease with DLJ Securities Corporation dated July 1, 1987, then the
provisions of Section 7.2 shall apply and (ii) if Seller is unable to obtain a
copy of the Letter Agreement dated July 18, 1991 with Combined Data Resources,
Inc., then the provisions of Section 7.2 shall apply. To the extent any other
originals are in Seller's possession, Seller shall also deliver same;
(i) A certificate, dated as of the date of Closing, stating that
the representations and warranties of Seller contained in Section 8.1 are true
and correct in all material respects as of the Closing Date (with appropriate
modifications to reflect any changes therein) or 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 if any representation or
warranty is not true and correct in all material respects; PROVIDED, HOWEVER,
that such event shall constitute the non-fulfillment of the condition set forth
in Section 9.1(b). If, despite changes or other matters described in such
certificate, the Closing occurs, Seller's representations and warranties set
forth in this Agreement shall be deemed to have been modified by all statements
made in such certificate;
(j) The Lease Schedule, updated to show any changes dated as of no
more than five (5) Business Days prior to the Closing Date;
(k) Counterparts of the transfer tax declarations, duly executed
by Seller;
(l) A statement as to the last date through which rents have been
paid by Tenants;
(m) A counterpart original of the Closing Statement, duly executed
by Seller;
(n) The Leasing and Management Agreement, substantially in the
form of EXHIBIT L annexed hereto;
(o) An assignment, without representation, warranty or recourse,
of all Seller's right, title and interest in and to any trademarks, trade name,
fictitious name or other form of identification for or related to the property,
except that there shall be no assignment of the name Xxxx-Xxxx, Cali, or any
derivation thereof;
(p) The ISRA Letter;
(q) An assignment and assumption of the Ground Lease;
(r) A seller's title affidavit in form and substance reasonably
acceptable to Seller and the Title Company; and
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(s) Such other documents as may be reasonably necessary or
appropriate to effect the consummation of the transaction which is the subject
of this Agreement.
SECTION 10.4 PRORATIONS.
(a) Seller and Purchaser agree to adjust, as of 11:59 p.m. on the
day preceding the Closing Date (the "PRORATION TIME"), the following
(collectively, the "PRORATION ITEMS"):
(i) Rentals, in accordance with Subsection 10.4(b) below.
(ii) Security Deposits and any prepaid rents, together with
interest required to be paid thereon.
(iii) Utility charges payable by Seller, including, without
limitation, electricity, water charges and sewer charges. If there are meters on
the Real Property, Seller will cause readings of all said meters to be performed
not more than five (5) days prior to the Closing Date, and a per diem adjustment
shall be made for the days between the meter reading date and the Closing Date
based on the most recent meter reading.
(iv) Amounts payable under the Service Contracts other than
those Service Contracts which Purchaser has elected not to assume.
(v) Real estate taxes due and payable for the calendar year.
If the Closing Date shall occur before the tax rate is fixed, the apportionment
of real estate taxes shall be upon the basis of the tax rate for the preceding
year applied to the latest assessed valuation. If subsequent to the Closing
Date, real estate taxes (by reason of change in either assessment or rate or for
any other reason) for the Real Property should be determined to be higher or
lower than those that are apportioned, a new computation shall be made, and
Seller agrees to pay Purchaser any increase shown by such recomputation and vice
versa.
(vi) The value of fuel stored at the Real Property, at
Seller's most recent cost, including taxes, on the basis of a reading made
within five (5) days prior to the Closing by Seller's supplier.
No adjustments shall be made on account of the Ground Lease.
Seller will be charged and credited for the amounts of all of the
Proration Items relating to the period up to and including the Proration Time,
and Purchaser will be charged and credited for all of the Proration Items
relating to the period after the Proration Time. The estimated Closing
prorations shall be set forth on a preliminary closing statement to be prepared
by Seller and submitted to Purchaser prior to the Closing
32
Date (the "CLOSING STATEMENT"). The Closing Statement, once agreed upon, shall
be signed by Purchaser and Seller. The proration shall be paid at Closing by
Purchaser to Seller (if the prorations result in a net credit to Seller) or by
Seller to Purchaser (if the prorations result in a net credit to Purchaser) by
increasing or reducing the cash to be delivered by Purchaser in payment of the
Purchase Price at the Closing. If the actual amounts of the Proration Items are
not known as of the Closing Date, the prorations will be made at Closing on the
basis of the best evidence then available; thereafter, when actual figures are
received, re-prorations will be made on the basis of the actual figures, and a
final cash settlement will be made between Seller and Purchaser. No prorations
will be made in relation to insurance premiums, and Seller's insurance policies
will not be assigned to Purchaser. Final readings and final xxxxxxxx for
utilities will be made if possible as of the Closing Date, in which event no
proration will be made at the Closing with respect to utility bills. Seller will
be entitled to all deposits presently in effect with the utility providers, and
Purchaser will be obligated to make its own arrangements for any deposits with
the utility providers. The provisions of this Section 10.4(a) will survive the
Closing for eighteen (18) months.
(b) Purchaser will receive a credit on the Closing Statement for
the prorated amount (as of the Proration Time) of all Rental previously paid to
or collected by Seller and attributable to any period following the Proration
Time. After the Closing, Seller will cause to be paid or turned over to
Purchaser all Rental, if any, received by Seller after Closing and attributable
to any period following the Proration Time. "RENTAL" as used herein includes
fixed monthly rentals, additional rentals, percentage rentals, escalation
rentals (which include each Tenant's proration share of building operation and
maintenance costs and expenses as provided for under the Lease, to the extent
the same exceeds any expense stop specified in such Lease), retroactive rentals,
all administrative charges, utility charges, tenant or real property association
dues, storage rentals, special event proceeds, temporary rents, telephone
receipts, locker rentals, vending machine receipts and other sums and charges
payable by Tenants under the Leases or from other occupants or users of the
Property. Rental is "DELINQUENT" when it was due prior to the Closing Date, and
payment thereof has not been made on or before the Proration Time. Delinquent
Rental will not be prorated. Purchaser agrees to use good faith collection
procedures with respect to the collection of any Delinquent Rental, but
Purchaser will have no liability for the failure to collect any such amounts and
will not be required to pursue legal action to enforce collection of any such
amounts owed to Seller by any Tenant. All sums collected by Purchaser from and
after Closing from each Tenant (excluding tenant specific xxxxxxxx for tenant
work orders and other specific services as described in and governed by Section
10.4(d) below and excluding payments on account of 1999 reconciliations of
operating expenses, utilities and real estate tax payments or payments in lieu
thereof) will be applied first to current amounts owed by such Tenant to
Purchaser and then to delinquencies owed by such Tenant to Seller. Any sums due
Seller will be promptly remitted to Seller.
(c) At the Closing, Seller shall deliver to Purchaser a list of
additional rent, however characterized, under each Lease, including without
limitation, real estate
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taxes, electrical charges, utility costs and operating expenses (collectively,
"OPERATING EXPENSES") billed to Tenants for the calendar year in which the
Closing occurs (both on a monthly basis and in the aggregate), the basis on
which the monthly amounts are being billed and the amounts incurred by Seller on
account of the components of Operating Expenses for such calendar year. Upon the
reconciliation by Purchaser of the Operating Expenses billed to Tenants, and the
amounts actually incurred for such calendar year, Seller and Purchaser shall be
liable for overpayments of Operating Expenses, and shall be entitled to payments
from Tenants, as the case may be, on a PRO-RATA basis based upon each party's
period of ownership during such calendar year.
(d) With respect to specific tenant xxxxxxxx for work orders,
special items performed or provided at the request of a Tenant or other specific
services, which are collected by Purchaser after the Closing Date but relate to
the foregoing specific services rendered by Seller prior to the Proration Time,
and with respect to payments on account of 1999 reconciliations of operating
expenses, utilities and real estate tax payments or payments in lieu thereof,
then notwithstanding anything to the contrary contained herein, Purchaser shall
cause amounts specifically allocated for such purposes by such Tenant to be paid
to Seller on account thereof. To Seller's knowledge, any unpaid amounts through
January 21, 2000 are not material.
(e) Notwithstanding any provision of this Section 10.4 to the
contrary, Purchaser will be solely responsible for any leasing commissions due
pursuant to a Brokerage Commission Agreement, tenant improvement costs or other
expenditures due with respect to any amendments, renewals and/or expansions of
any Leases existing as of the Effective Date, and Seller shall be responsible
for any leasing commissions due on account of the initial term, or renewal
period of any Lease, if the initial term or the renewal period began prior to
the Effective Date. At Closing, Seller shall establish an escrow with the Escrow
Agent in the amount set forth on Exhibit P, and enter into an escrow agreement
on terms and conditions reasonably acceptable to Seller, Purchaser and Escrow
Agent, pursuant to which the Escrow Agent shall be obligated to disburse same
when due upon receipt of a proper and timely invoice. Purchaser further agrees
to be solely responsible for all leasing commissions, tenant improvement costs
and other expenditures (for purposes of this Section 10.4(e), "NEW TENANT
COSTS") incurred or to be incurred in connection with any new lease executed on
or after the Effective Date, and Purchaser will pay to Seller at Closing as an
addition to the Purchase Price an amount equal to the New Tenant Costs paid by
Seller.
(f) Notwithstanding any other provision of this Agreement to the
contrary, if Purchaser shall become liable after the Closing for payment of any
real estate taxes or other such charges assessed or imposed against the Property
for any period of time prior to the Closing Date or other charge or expense
which was subject to proration or a Purchase Price credit in Purchaser's favor
at Closing, which was not so adjusted or credited at Closing and which is not
the obligation of a Tenant to pay or to reimburse the landlord under a Tenant's
Lease, Seller shall pay to Purchaser, within thirty (30) days of
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demand accompanied by a calculation and reconciliation of the amount due, an
amount equal to such tax or credit due Purchaser.
SECTION 10.5 COSTS OF TITLE COMPANY AND CLOSING COSTS. Costs of the Title
Company and other Closing costs incurred in connection with the Closing will be
allocated as follows:
(a) Seller shall pay (i) Seller's attorney's fees; (ii) the realty
transfer tax due by reason of the transfer of the Property; (iii) the charges to
record the Deed; and (iv) the brokerage commission due to Rockwood Associates,
L.L.C. ("ROCKWOOD") as more particularly provided in Section 16.1.
(b) Purchaser shall pay (i) the cost of the premium for the Title
Policy and all title searches; (ii) all costs of any additional coverage under
the Title Policy or endorsements or deletions to the Title Policy that are
desired by Purchaser; (iii) all premiums and other costs for any mortgagee
policy of title insurance, if any, including but not limited to any endorsements
or deletions; (iv) Purchaser's attorney's fees; (v) the brokerage commission due
to Xxxxxxxx Xxxx Company ("XXXXXXXX") as more particularly provided in Section
16.1; and (vi) the costs of the Updated Survey, as provided for in Section 6.1.
(c) Any other costs and expenses of Closing not provided for in
this Section 10.5 shall be allocated between Purchaser and Seller in accordance
with the custom in the area in which the Property is located.
SECTION 10.6 POST-CLOSING DELIVERY OF TENANT NOTICE LETTERS. Immediately
following Closing, Purchaser will deliver to each Tenant a Tenant Notice Letter,
as described in Section 10.2(e).
SECTION 10.7 LIKE-KIND EXCHANGE. In the event that Seller shall elect to
effectuate the Closing as a "like-kind" exchange under Section 1031 of the Code,
Purchaser agrees to cooperate and assist Seller in all reasonable respects (at
no cost to Purchaser other than de minimis attorneys' fees of Purchaser's
counsel) in order that the exchange so qualifies as a "like-kind" exchange under
Section 1031 of the Code and the Treasury Regulations promulgated, or to be
promulgated, thereunder.
ARTICLE XI
CONDEMNATION AND CASUALTY
SECTION 11.1 CASUALTY. If, prior to the Closing Date, all or any portion
of the Real Property and Improvements is destroyed or damaged by fire or other
casualty, Seller will notify Purchaser of such casualty. Purchaser will have the
option to terminate this Agreement upon notice to Seller given not later than
fifteen (15) days after receipt of Seller's notice if all or a Significant
Portion of the Real Property and Improvement are damaged or destroyed. If this
Agreement is terminated, the Xxxxxxx Money Deposit and
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all interest accrued thereon will be returned to Purchaser and thereafter
neither Seller nor Purchaser will have any further rights or obligations to the
other hereunder except with respect to the Termination Surviving Obligations. If
Purchaser does not elect to terminate this Agreement or less than a Significant
Portion of the Real Property and Improvements is destroyed or damaged as
aforesaid, Seller will not be obligated to repair such damage or destruction but
(a) Seller will assign and turn over to Purchaser the insurance proceeds net of
reasonable collection costs (or if such have not been awarded, all of its right,
title and interest therein) payable with respect to such fire or other casualty
up to the amount of the Purchase Price and (b) the parties will proceed to
Closing pursuant to the terms hereof without abatement of the Purchase Price,
except that Purchaser will receive credit for any insurance deductible amount.
In the event Seller elects to perform any repairs as a result of a casualty,
Seller will be entitled to deduct its costs and expenses from any amount to
which Purchaser is entitled under this Section 11.1, which right shall survive
the Closing.
SECTION 11.2 CONDEMNATION OF PROPERTY.
(a) In the event of (i) any condemnation or sale in lieu of
condemnation of all of the Property; or (ii) any condemnation or sale in lieu of
condemnation of greater than five percent (5%) of the fair market value of the
Property prior to the Closing, Purchaser will have the option, to be exercised
within fifteen (15) days after receipt of notice of such condemnation or sale,
of terminating Purchaser's obligations under this Agreement, or electing to have
this Agreement remain in full force and effect. In the event that either (i) any
condemnation or sale in lieu of condemnation of the Property is for less than
five percent (5%) of the fair market value of the Property, or (ii) Purchaser
does not terminate this Agreement pursuant to the preceding sentence, Seller
will assign to Purchaser any and all claims for the proceeds of such
condemnation or sale to the extent the same are applicable to the Property, and
Purchaser will take title to the Property with the assignment of such proceeds
and subject to such condemnation and without reduction of the Purchase Price.
Should Purchaser elect to terminate Purchaser's obligations under this Agreement
under the provisions of this Section 11.2, the Xxxxxxx Money Deposit and any
interest thereon will be returned to Purchaser and neither Seller nor Purchaser
will have any further obligation under this Agreement, except for the
Termination Surviving Obligations. Notwithstanding anything to the contrary
herein, if any eminent domain or condemnation proceeding is instituted (or
notice of same is given) solely for the taking of any subsurface rights for
utility easements or for any right-of-way easement, and the surface and the
Improvements may, after such taking, be used in substantially the same manner as
though such rights have not been taken, Purchaser will not be entitled to
terminate this Agreement as to any part of the Property, but any award resulting
therefrom will be assigned to Purchaser at Closing and will be the exclusive
property of Purchaser upon Closing.
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ARTICLE XII
CONFIDENTIALITY
SECTION 12.1 CONFIDENTIALITY. Seller and Purchaser each expressly
acknowledge and agree that the transactions contemplated by this Agreement and
the terms, conditions, and negotiations concerning the same will be held in the
strictest confidence by each of them and will not be disclosed by either of them
except to their respective legal counsel, accountants, consultants, officers,
employees, partners, directors, and shareholders, and except and only to the
extent that such disclosure may be necessary for their respective performances
hereunder. Purchaser further acknowledges and agrees that, unless and until the
Closing occurs, all information obtained by Purchaser in connection with the
Property will not be disclosed by Purchaser to any third persons without the
prior written consent of Seller, provided that no such consent shall be required
in respect of such information being disclosed to any of the persons mentioned
in the first sentence of this Section 12.1. Nothing contained in this Article
XII will preclude or limit either party to this Agreement from disclosing or
accessing any information otherwise deemed confidential under this Article XII
response to lawful process or subpoena or other valid or enforceable order of a
court of competent jurisdiction or any filings with governmental authorities
required by reason of the transactions provided for herein pursuant to an
opinion of counsel. Nothing in this Article XII will negate, supersede or
otherwise affect the obligations of the parties under the Confidentiality
Agreement. In addition, prior to or as a part of the Closing, any release to the
public of information 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 and their respective counsel, which approval shall not be
unreasonably withheld or delayed. The provisions of this Article XII will
survive the Closing or any termination of this Agreement.
ARTICLE XIII
REMEDIES
SECTION 13.1 DEFAULT BY SELLER. In the event the Closing and the
transactions contemplated hereby do not occur as herein provided by reason of
any default of Seller, Purchaser may, as Purchaser's sole and exclusive remedy,
elect by notice to Seller within ten (10) Business Days following the Scheduled
Closing Date, either of the following: (a) terminate this Agreement, in which
event Purchaser will receive from the Escrow Agent the Xxxxxxx Money Deposit,
together with all interest accrued thereon, and in the event that the Agreement
is terminated due to the willful or grossly negligent acts of Seller, Seller
shall reimburse Purchaser up to $400,000 for its title, survey, consultants and
reasonable attorneys fees and expenses, as documented by Purchaser, whereupon
Seller and Purchaser will have no further rights or obligations under this
Agreement, except with respect to the Termination Surviving Obligations; or (b)
seek to enforce specific performance of Seller's obligations hereunder, except
that Purchaser shall not have the right to seek to enforce specific performance
of those obligations of Seller which would require a subjective determination as
to whether Seller has used commercially reasonable efforts, reasonable efforts,
best efforts or similar standards in performing its obligations.
37
Except as specifically provided in Section 13.1(a), Purchaser expressly waives
its rights to seek damages in the event of Seller's default hereunder. Purchaser
shall be deemed to have elected to terminate this Agreement and receive back the
Xxxxxxx Money Deposit if Purchaser fails to advise Seller, on or before sixty
(60) days following the Scheduled Closing Date or sixty (60) days following the
last date to which either party had exercised an extension of the Closing past
the Scheduled Closing Date as permitted in this Agreement, that it intends to
file suit for specific performance against Seller in a court having jurisdiction
in the county and state in which the Property is located, and if Purchaser fails
to actually file such suit within sixty (60) days after Purchaser advises Seller
that it intends to file suit. Notwithstanding the foregoing, nothing contained
in this Section 13.1 will limit Purchaser's remedies at law, in equity or as
herein provided in pursuing remedies of a breach by Seller of any of the
Termination Surviving Obligations.
SECTION 13.2 DEFAULT BY PURCHASER. In the event the Closing and the
consummation of the transactions contemplated herein do not occur as provided
herein by reason of any default of Purchaser, Purchaser and Seller agree it
would be impractical and extremely difficult to fix the damages which Seller may
suffer. Purchaser and Seller hereby agree that (a) an amount equal to the
Xxxxxxx Money Deposit is a reasonable estimate of the total net detriment Seller
would suffer in the event Purchaser defaults and fails to complete the purchase
of the Property, and (b) such amount will be the full, agreed and liquidated
damages for Purchaser's default and failure to complete the purchase of the
Property, and will be Seller's sole and exclusive remedy (whether at law or in
equity) for any default of Purchaser resulting in the failure of consummation of
the Closing, whereupon this Agreement will terminate and Seller and Purchaser
will have no further rights or obligations hereunder, except with respect to the
Termination Surviving Obligations. The payment of such amount as liquidated
damages is not intended as a forfeiture or penalty but is intended to constitute
liquidated damages to Seller. Notwithstanding the foregoing, nothing contained
herein will limit Seller's remedies at law, in equity or as herein provided in
the event of a breach by Purchaser of any of the Termination Surviving
Obligations.
ARTICLE XIV
NOTICES
SECTION 14.1 NOTICES.
(a) All notices or other communications required or permitted
hereunder shall be in writing, and shall be given by any nationally recognized
overnight delivery service with proof of delivery, or by facsimile transmission
(provided that such facsimile is confirmed by the sender by expedited delivery
service in the manner previously described), 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 will have designated by written notice sent
in accordance herewith. Unless changed in accordance with the preceding
sentence, the addresses for notices given pursuant to this Agreement will be as
follows:
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If to Purchaser: Germania of America, Inc.
Tower Place, Suite 2995
0000 Xxxxxxxxx Xxxx, X.X.
Xxxxxxx, Xxxxxxx 00000
Attention: Xx. Xxxx X. Xxxx, Xx.
Telephone No. (000) 000-0000
Fax No. (000) 000-0000
and
Commerz Xxxxxxxxxx XxxX
Xxxxxx-Xxxxxx-Xxxxx-0
X-00000 Xxxxxxxxxx, Xxxxxxx
Attention: General Management
Telephone No.: 000-00-000-0000-000
Fax No.: 000-00-000-0000-000
with a copy to: Xxxxx Xxxxxxxxxx LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxx, Esq.
Telephone No. (000) 000-0000
Fax No. (000) 000-0000
If Seller: c/o Xxxx-Xxxx Realty Corporation
00 Xxxxxxxx Xxxxx
Xxxxxxxx, Xxx Xxxxxx 00000
with separate notices to the attention of:
Xx. Xxxxxxxx X. Xxxxx
(000) 000-0000 (tele.)
(000) 000-0000 (fax)
and
Xxxxx X. Xxxxxx, Esq.
(000) 000-0000 (tele.)
(000) 000-0000 (fax)
With a copy to: Xxxxxx X. Xxxxxx, Esq.
Xxxxx Xxxxxxx Xxxxxxx & Xxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
(000)000-0000 (tele.)
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(000)000-0000 (fax)
If to Escrow
Agent: Titleserv Agency of New York, Inc., as agent for
Fidelity National Title Insurance Company of New York
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxx XxXxxxxxx, Esq.
(000)000-0000 (tele.)
(000)000-0000 (fax)
(b) Notices given by (i) overnight delivery service as aforesaid
shall be deemed received and effective on the second Business Day following such
dispatch and (ii) facsimile transmission as aforesaid shall be deemed given at
the time and on the date of machine transmittal provided same is sent prior to
4:00 p.m. on a Business Day in the country where such party is located (if sent
later, then notice shall be deemed given on the next Business Day). Notices may
be given by counsel for the parties described above, and such notices shall be
deemed given by said party, for all purposes hereunder.
ARTICLE XV
ASSIGNMENT AND BINDING EFFECT
SECTION 15.1 ASSIGNMENT: BINDING EFFECT. Purchaser will not have the right
to assign this Agreement, or to designate another party or two (2) separate
parties to be the grantee, transferee or assignee of the Deed and the Assignment
and Assumption of the Ground Lease, as the case may be, or to assign any of the
other Closing documents, without the prior written consent of Seller to be given
or withheld in Seller's sole discretion, except that Purchaser may assign this
Agreement, or designate another party or two (2) separate parties to be the
grantee, transferee or assignee, as the case may be, to an entity controlled by,
controlling, or under the common control of the originally named Purchaser. No
such assignment or designation shall be binding on Seller or effective unless
and until Seller shall receive a fully executed assignment and assumption
agreement, between Purchaser and its assignee, whereby among other things, such
assignee assumes all of the obligations and liabilities of Purchaser hereunder.
No such assignment and assumption shall relieve the originally named Purchaser
of any of the obligations and liabilities of Purchaser hereunder.
ARTICLE XVI
BROKERAGE
SECTION 16.1 BROKERS. Seller agrees to pay to Rockwood a brokerage
commission pursuant to a separate agreement by and between Seller and Rockwood.
Purchaser agrees to pay Xxxxxxxx (together with Rockwood, the "BROKERS") a
brokerage commission pursuant to a separate agreement by and between Purchaser
and Xxxxxxxx. Purchaser and Seller represent that they have not dealt with any
brokers, finders or salesmen, in connection with this transaction other than the
Brokers, and agree to
40
indemnify, defend and hold each other harmless from and against any and all
loss, cost, damage, liability or expense, including reasonable attorneys' fees,
which either party may sustain, incur or be exposed to by reason of any claim
for fees or commissions made through the other party. The provisions of this
Article XVI will survive any Closing or termination of this Agreement.
ARTICLE XVII
ESCROW AGENT
SECTION 17.1. ESCROW.
(a) Escrow Agent will hold the Xxxxxxx Money Deposit in escrow in
an interest bearing account of the type generally used by Escrow Agent for the
holding of escrow funds until the earlier of (i) the Closing, or (ii) the
termination of this Agreement in accordance with any right hereunder. In the
event Purchaser has not terminated this Agreement by the end of the Evaluation
Period or in the event Purchaser fails to advise Seller in writing that
Purchaser is proceeding under this Agreement by notice to Seller given prior to
the expiration of the Evaluation Period, the Xxxxxxx Money Deposit shall be
non-refundable to Purchaser, but shall be credited against the Purchase Price at
the Closing. In all events, all interest accrued on the Xxxxxxx Money Deposit
will be paid by the Escrow Agent to the Purchaser as provided in Section 4.2. In
the event the Closing occurs, the Xxxxxxx Money Deposit will be released to
Seller, and Purchaser shall receive a credit against the Purchase Price in the
amount of the Xxxxxxx Money Deposit. In all other instances, Escrow Agent shall
not release the Xxxxxxx Money Deposit to either party until Escrow Agent has
been requested by Seller or Purchaser to release the Xxxxxxx Money Deposit and
has given the other party five (5) Business Days to dispute, or consent to, the
release of the Xxxxxxx Money Deposit. Purchaser represents that the tax
identification number for Germania, for purposes of reporting the interest
earnings, is 00-0000000. Seller represents that its tax identification number,
for purposes of reporting the interest earnings, is 00-0000000.
(b) Escrow Agent shall not be liable to any party for any act or
omission, except for bad faith, gross negligence or willful misconduct, and the
parties agree to indemnify Escrow Agent and hold Escrow Agent harmless from any
and all claims, damages, losses or expenses arising in connection herewith. The
parties acknowledge that Escrow Agent is acting solely as stakeholder for their
mutual convenience. In the event Escrow Agent receives written notice of a
dispute between the parties with respect to the Xxxxxxx Money Deposit and the
interest earned thereon (the "ESCROWED FUNDS"), Escrow Agent shall not be
entitled to release and deliver the Escrowed Funds to either party but may
either (i) continue to hold the Escrowed Funds until otherwise directed in a
writing signed by all parties hereto or (ii) deposit the Escrowed Funds with the
clerk of any court of competent jurisdiction. Upon such deposit, Escrow Agent
will be released from all duties and responsibilities hereunder. Escrow Agent
shall have the right to consult with separate counsel of its own choosing (if it
deems such consultation advisable) and shall not be liable for any action taken,
suffered or omitted by it in accordance with the advice of such counsel.
41
(c) Escrow Agent shall not be required to defend any legal
proceeding which may be instituted against it with respect to the Escrowed
Funds, the Property or the subject matter of this Agreement unless requested to
do so by Purchaser or Seller and is indemnified to its satisfaction against the
cost and expense of such defense. Escrow Agent shall not be required to
institute legal proceedings of any kind and shall have no responsibility for the
genuineness or validity of any document or other item deposited with it or the
collectibility of any check delivered in connection with this Agreement. Escrow
Agent shall be fully protected in acting in accordance with any written
instructions given to it hereunder and believed by it to have been signed by the
proper parties.
ARTICLE XVIII
MISCELLANEOUS
SECTION 18.1 WAIVERS. No waiver of any breach of any covenant or
provisions contained herein will be deemed a waiver of any preceding or
succeeding breach thereof, or of any other covenant or provision contained
herein. No extension of time for performance of any obligation or act will be
deemed an extension of the time for performance of any other obligation or act.
SECTION 18.2 RECOVERY OF CERTAIN FEES. In the event a party hereto files
any action or suit against another party hereto by reason of any breach of any
of the covenants, agreements or provisions contained in this Agreement, then in
that event the prevailing party will be entitled to have and recover the costs
and expenses the prevailing party has incurred therein from the other party
including all reasonable attorneys' fees and costs resulting therefrom. In the
event that one party hereto has not prevailed entirely in any such suit or
action, only the party which has prevailed to a greater extent (as determined by
the court, agency or other authority before which such suit, action or
proceeding is commenced) shall be entitled to so recover its costs and expenses
but such prevailing party shall only be entitled to recover that portion of such
costs and expenses which is in proportion to the relative degree to which such
party prevailed in such suit or action (as determined by the court, agency or
other authority before which such suit, action or proceeding is commenced). For
purposes of this Agreement, the term "attorneys' fees" or "attorneys' fees and
costs" shall mean the fees and expenses of counsel to the parties hereto, which
may include printing, photostating, duplicating and other expenses, air freight
charges, and fees billed for law clerks, paralegals and other persons not
admitted to the bar but performing services under the supervision of an
attorney, and the costs and fees incurred in connection with the enforcement or
collection of any judgment obtained in any such proceeding. The provisions of
this Section 18.2 shall survive the entry of any judgment, and shall not merge,
or be deemed to have merged, into any judgment.
SECTION 18.3 CONSTRUCTION. Headings at the beginning of each article and
section are solely for the convenience of the parties and are not a part of this
Agreement.
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Whenever required by the context of this Agreement, the singular will include
the plural and the masculine will include the feminine and vice versa. This
Agreement will not be construed as if it had been prepared by one of the
parties, but rather as if both parties had prepared the same. All exhibits and
schedules referred to in this Agreement are attached and incorporated by this
reference, and any capitalized term used in any exhibit or schedule which is not
defined in such exhibit or schedule will have the meaning attributable to such
term in the body of this Agreement. In the event the date on which Purchaser or
Seller is required to take any action under the terms of this Agreement is not a
Business Day, the action will be taken on the next succeeding Business Day.
SECTION 18.4 COUNTERPARTS. This Agreement may be executed in multiple
counterparts, each of which, when assembled to include an original signature for
each party contemplated to sign this Agreement, will constitute a complete and
fully executed original. All such fully executed original counterparts will
collectively constitute a single agreement.
SECTION 18.5 SEVERABILITY. If any term or other provision of this
Agreement is invalid, illegal, or incapable of being enforced by any rule of law
or public policy, all of the other conditions and provisions of this Agreement
will nevertheless remain in full force and effect, so long as the economic or
legal substance of the transactions contemplated hereby is not affected in any
adverse manner to either party. Upon such determination that any term or other
provision is invalid, illegal, or incapable of being enforced, the parties
hereto will negotiate in good faith to modify this Agreement so as to reflect
the original intent of the parties as closely as possible in an acceptable
manner to the end that the transactions contemplated hereby are fulfilled to the
extent possible.
SECTION 18.6 ENTIRE AGREEMENT. This Agreement is the final expression of,
and contains the entire agreement between, the parties with respect to the
subject matter hereof, and supersedes all prior understandings with respect
thereto. This Agreement may not be modified, changed, supplemented or
terminated, nor may any obligations hereunder be waived, except by written
instrument, signed by the party to be charged or by its agent duly authorized in
writing, or as otherwise expressly permitted herein.
SECTION 18.7 GOVERNING LAW. THIS AGREEMENT WILL BE CONSTRUED, PERFORMED
AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE IN WHICH THE PROPERTY IS
LOCATED. SELLER AND PURCHASER HEREBY IRREVOCABLY SUBMIT TO THE JURISDICTION OF
ANY STATE OR FEDERAL COURT SITTING IN THE STATE IN WHICH THE PROPERTY IS LOCATED
IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT AND
HEREBY IRREVOCABLY AGREE THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING
SHALL BE HEARD AND DETERMINED IN A STATE OR FEDERAL COURT SITTING IN THE STATE
IN WHICH THE PROPERTY IS LOCATED.
43
SECTION 18.8 NO RECORDING. The parties hereto agree that neither this
Agreement nor any affidavit or memorandum concerning it will be recorded and any
recording of this Agreement or any such affidavit or memorandum by Purchaser
will be deemed a default by Purchaser hereunder.
SECTION 18.9 FURTHER ACTIONS. The parties agree to execute such
instructions to the Title Company and such other instruments and to do such
further acts as may be reasonably necessary to carry out the provisions of this
Agreement.
SECTION 18.10 EXHIBITS. The following sets forth a list of Exhibits
to the Agreement:
Exhibit A - Assignment
Exhibit B - Assignment of Leases
Exhibit C - Xxxx of Sale
Exhibit D - Legal Description of Real Property
Exhibit E - Service Contracts
Exhibit F - Lease Schedule
Exhibit G - Permitted Exceptions
Exhibit H - Tenant Estoppels
Exhibit I - Suits and Proceedings
Exhibit J - Certificate as to Foreign Status
Exhibit K - NTT Lease Extension - Agreed Terms
Exhibit L - Leasing and Management Agreement
Exhibit M - Confidentiality Agreement
Exhibit N - Brokerage Commission Agreements
Exhibit O - Notice to Tenants
Exhibit P - Seller's Tenant Improvement Cost Obligations
Exhibit Q - Xxxxxx Employees
SECTION 18.11 NO PARTNERSHIP. Notwithstanding anything to the contrary
contained herein, this Agreement shall not be deemed or construed to make the
parties hereto partners or joint venturers, it being the intention of the
parties to merely create the relationship of Seller and Purchaser with respect
to the Property to be conveyed as contemplated hereby.
SECTION 18.12 LIMITATIONS ON BENEFITS. It is the explicit intention of
Purchaser and Seller that no person or entity other than Purchaser and Seller
and their permitted successors and assigns is or shall be entitled to bring any
action to enforce any provision of this Agreement against any of the parties
hereto, and the covenants, undertakings and agreements set forth in this
Agreement shall be solely for the benefit of, and shall be enforceable only by,
Purchaser and Seller or their respective successors and assigns as permitted
hereunder. Nothing contained in this Agreement shall under any circumstances
whatsoever be deemed or construed, or be interpreted, as making any third party
(including, without limitation, Brokers) a beneficiary of any term or provision
of this
44
Agreement or any instrument or document delivered pursuant hereto, and Purchaser
and Seller expressly reject any such intent, construction or interpretation of
this Agreement.
ARTICLE XIX
ISRA
SECTION 19.1 ISRA. As a condition precedent to Seller's obligation to sell
and Purchaser's obligation to purchase the Property pursuant to this Agreement,
Seller shall have received a non-applicability letter (the "ISRA LETTER") from
the Industrial Site Evaluation Element, or its successor, of the New Jersey
Department of Environmental Protection, or its successor ("DEP"), for which
Seller shall apply pursuant to the Industrial Site Recovery Act, N.J.S.A.
13:1K-6 ET SEQ., the regulations promulgated thereunder, and any successor
legislation and regulations. Seller agrees to use commercially reasonable
efforts to obtain the ISRA Letter. If this condition precedent is not met at
least twenty (20) days prior to Closing, then either party shall have the right
to void this Agreement on notice to the other, in which event, except as
otherwise provided in this Agreement, neither party shall be under any further
obligation to the other, with the exception that the Xxxxxxx Money Deposit,
together with interest thereon shall be returned to Purchaser.
Seller shall contemporaneously furnish Purchaser with all submissions,
documents and correspondence sent to or received from DEP relating to the
foregoing. Seller shall notify Purchaser in advance of all meetings scheduled
between Seller or Seller's representatives and DEP with respect to the Property
and Purchaser and Purchaser's representatives shall have the right, but not the
obligation, to attend and participate in all such meetings.
ARTICLE XX
NON-COMPETITION
SECTION 20.1 NON-COMPETITION. For so long as the Leasing and Management
Agreement shall be in effect, neither Seller nor Xxxx Xxxx Realty L.P.
("MCRLP"), nor any affiliate of MCRLP in which MCRLP has a majority ownership
interest and exercises voting control (collectively, the "Competitive Entities")
shall solicit any person or entity while they are a tenant in the Improvements
(all such persons and entities, collectively, the "Existing Tenants"), and/or
enter into any lease with any of the Existing Tenants, to move any of the
Existing Tenants from the Improvements and into office space in other buildings
in Jersey City, New Jersey at any time when comparable space is available for
leasing in the Improvements, without the prior written consent of Purchaser. So
long as the agent under the Leasing and Management Agreement shall have apprised
Existing Tenant who shall inquire as to available space in the Improvements of
the status of such space, then a determinative factor as to whether comparable
office space is available in
45
the Improvements shall be a statement from the Existing Tenant that no space in
the Improvements meets the requirements or needs of the Existing Tenant.
Notwithstanding anything to the contrary contained in this Article XX, in no
event shall a Competitive Entity be precluded from responding to an unsolicited
"Request for Proposal" or other solicitation by an Existing Tenant with respect
to office space in Jersey City, New Jersey, nor shall a Competitive Entity be
precluded from entering into a lease with an Existing Tenant for space in Jersey
City, New Jersey pursuant to or as a result of such "Request for Proposal" or
other solicitation, provided that a Competitive Entity has provided notice to
Purchaser of such solicitation promptly after any Competitive Entity becomes
aware of such Request for Proposal" or other solicitation in order to allow
Purchaser a reasonable opportunity to respond thereto. The provisions of this
Article XX shall survive the Closing for the period set forth in the first
sentence of this Article. This Article shall inure solely to the benefit of the
grantee named in the deed from Seller for the Improvements and any Affiliate
which owns the Improvements, and shall not be for the benefit of any successor
or assignee of such grantee, nor any other third party. MCRLP has executed this
Agreement for the sole purpose of agreeing to the terms of this Article XX and
Section 8.3 hereof.
46
IN WITNESS WHEREOF, Seller and Purchaser have respectively executed this
Agreement as of the Effective Date.
Date Executed: SELLER:
January 31, 0000 Xxxxx Xxxxxx Associates of Jersey City
Limited Partnership
By: Xxxx-Xxxx Sub IV, Inc.,
its general partner
By: /s/ Xxxxx X. Xxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Executive Vice President,
General Counsel and Secretary
Cali-Grove Street Urban Renewal
Associates L.P.
By: Xxxx-Xxxx Sub IV, Inc.,
its general partner
By: /s/ Xxxxx X. Xxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Executive Vice President,
General Counsel and Secretary
PURCHASER:
January 31, 2000 CommerzLeasing und Immobilien GmbH
By: /s/ Xxxxxxx
------------------------------------
Name: Xxxxxxx
Title: Assistant Vice President
Germania of America, Inc.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Executive Vice President
47
AS TO ARTICLE XVII ONLY:
ESCROW AGENT:
January 31, 2000 Titleserv Agency of New York, Inc. as
agent for Fidelity National Title
Insurance Company of New York
By: /s/ Xxxx XxXxxxxxx
------------------------------------
Name: Xxxx XxXxxxxxx
Title: Senior Counsel
AS TO SECTION 8.3 AND ARTICLE XX
ONLY:
Xxxx-Xxxx Realty X.X.
Xxxx-Xxxx Realty Corporation,
its general partner
By: /s/ Xxxxx X. Xxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Executive Vice President,
General Counsel and Secretary
