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EXHIBIT 10.1
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AGREEMENT OF PURCHASE AND SALE
AND JOINT ESCROW INSTRUCTIONS
by and between
XXX PROPERTIES LLC, A CALIFORNIA LIMITED LIABILITY COMPANY,
as Seller
and
PACIFIC GULF PROPERTIES, INC,
-----------------------------
as Buyer
dated
September 10, 1997
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TABLE OF CONTENTS
PAGE
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AGREEMENT OF PURCHASE AND SALE AND JOINT ESCROW INSTRUCTIONS ................... 1
1. Purchase and Sale .................................................... 2
2. Purchase Price ....................................................... 2
2.1 Initial Deposit ................................................ 2
2.2 Additional Deposit.............................................. 2
2.3 Closing Funds................................................... 3
2.4 Interest on Deposits............................................ 3
3. Escrow................................................................ 3
3.1 Opening of Escrow............................................... 3
3.2 Closing......................................................... 4
4. Extension of Original Closing Date.................................... 4
5. Buyer's Examination/Reviews/Inspections............................... 4
5.1 Buyer's Approvals............................................... 4
(a) Title Examination....................................... 4
(b) Buyer's Reviews......................................... 5
(c) Buyer's Inspection...................................... 6
5.2 Funding Approval................................................ 7
5.3 Termination..................................................... 7
5.4 Allocation of Purchase Price.................................... 8
5.5 NO OBLIGATION BY SELLER TO CORRECT DEFECTS...................... 8
6. Deposits by Seller.................................................... 8
7. Deposits by Buyer..................................................... 9
8. Conditions of Closing................................................. 9
8.1 Buyer's Conditions.............................................. 9
8.1.1 Title Insurance........................................... 9
8.1.2 Delivery of Documents by Seller........................... 9
8.1.3 Tenant Estoppel Certificates.............................. 9
8.2 Seller's Condition.............................................. 10
9. Damage or Condemnation Prior to Closing............................... 11
9.1 Condemnation.................................................... 11
9.2 Casualty Loss................................................... 11
9.2.1 Casualty Over $1,000,000................................ 11
9.2.2 Casualty Under $1,000,000............................... 11
9.2.3 Cost of Repair.......................................... 12
9.2.4 Insurance............................................... 12
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10. Costs and Expenses.................................................... 12
10.1 Seller's Costs................................................ 12
10.2 Buyer's Costs................................................. 12
11. Prorations; Credits................................................... 12
12. Disbursements and Other Actions by Escrow Holder...................... 14
12.1 Closing....................................................... 14
12.2 Deliveries.................................................... 15
13. Operations During Escrow.............................................. 15
14. Conduct of Rental Activity Prior to Closing........................... 15
14.1 Rental Activity Prior to the Contingency Date................. 15
14.2 Rental Activity After the Contingency Date.................... 15
14.3 Certain Definitions........................................... 16
(a) Approved New Lease..................................... 16
(b) New Lease Commission................................... 16
(c) Tenant Improvement Costs............................... 16
(d) Approved New Lease Costs............................... 17
(e) Approved New Lease Term................................ 17
(f) Buyer's Share.......................................... 17
(g) Buyer's Share of Approved New Lease Costs.............. 17
(h) Buyer's Total Share of Approved New Lease Costs........ 17
14.4 Credit to Seller for Buyer's Total Share of Approved
New Lease Costs............................................... 17
15. Representations and Warranties........................................ 17
15.1 Seller's Representations...................................... 17
15.1.1 Authority; Binding On Seller; Enforceability........... 17
15.1.2 Conflict with Existing Laws or Contracts............... 17
15.2 Buyer's Representation........................................ 18
15.2.1 Authority; Enforceability.............................. 18
15.2.2 Conflict with Existing Laws or Contracts............... 18
15.2.3 Decision to Purchase................................... 18
15.2.4 Information Furnished to Seller........................ 18
16. Hazardous Material.................................................... 18
16.1 Definition of Hazardous Material................................. 18
16.2 Presence of Hazardous Material................................... 19
16.3 Indemnification.................................................. 19
17. Disclaimer/As Is Sale/Release......................................... 19
17.1 AS IS......................................................... 19
17.2 BUYER'S INDEPENDENT DUE DILIGENCE............................. 21
17.2.1 PHYSICAL INSPECTION.................................... 21
17.2.2 REVIEW OF RECORDS...................................... 21
17.2.3 PURCHASE FOR BUYER'S ACCOUNT........................... 22
17.3 Release ...................................................... 22
17.4 Waiver ....................................................... 22
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17.5 Certain Obligations Not Released.............................. 23
18. Legal Fees............................................................ 23
19. Notices............................................................... 24
20. Brokers............................................................... 25
21. No Survival........................................................... 25
22. Tax-Deferred Exchange................................................. 25
23. No Offer.............................................................. 26
24. Time of Essence....................................................... 26
25. Counterparts.......................................................... 26
26. Captions.............................................................. 26
27. No Obligations to Third Parties....................................... 26
28. Exhibits.............................................................. 26
29. Amendment to this Agreement........................................... 26
30. Waiver................................................................ 26
31. Applicable Law........................................................ 27
32. Entire Agreement...................................................... 27
33. Successors and Assigns................................................ 27
34. CERTAIN REMEDIES...................................................... 27
34.1 LIQUIDATED DAMAGES............................................ 27
34.2 LIMITATION ON LIABILITY....................................... 27
35. No Third Party Beneficiaries . . ..................................... 28
36. Interpretation; Computation of Periods................................ 28
37. Confidentiality....................................................... 28
38. AGENCY RELATIONSHIP................................................... 29
39. WAIVER OF TRIAL BY JURY............................................... 29
40. REVIEW WITH INDEPENDENT COUNSEL....................................... 29
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AGREEMENT OF PURCHASE AND SALE
AND JOINT ESCROW INSTRUCTIONS
THIS AGREEMENT OF PURCHASE AND SALE AND JOINT ESCROW INSTRUCTIONS
("AGREEMENT"), dated September 10, 1997 for reference purposes only, constitutes
an agreement by which_____________________________________________ ("BUYER"),
agrees to purchase, and XXX PROPERTIES LLC, a California limited liability
company ("SELLER"), agrees to sell the following described real and personal
property:
A. That certain improved real property located in the City of Anaheim,
County of Orange, State of California, commonly known as Commerce Park -
Anaheim, 0000 Xxxxx Xxxxx Xxxxxxx Xxxxxxxxx, Xxxxxxx, Xxxxxxxxxx, consisting of
(i) that certain real property more particularly described in EXHIBIT "X-0"
xxxxxxxx xxxxxx (xxx "XXXXXXX XXXX"), (xx) any and all improvements owned by
Seller and located on the Anaheim Land (the "ANAHEIM IMPROVEMENTS"), and (iii)
the personal property owned by Seller and located on the Anaheim Land listed on
EXHIBIT "A-2" attached hereto (collectively, the "ANAHEIM PERSONAL PROPERTY").
The Anaheim Land, Anaheim Improvements, and Anaheim Personal Property are herein
referred to collectively as the "ANAHEIM PROPERTY."
B. That certain improved real property located in the City of Sunnyvale,
County of Santa Xxxxx, State of California, commonly known as Commerce Park -
Sunnyvale, 0000 Xxxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxx, consisting of (i) that
certain real property more particularly described in EXHIBIT "B-1" attached
hereto (the "SUNNYVALE LAND"), (ii) any and all improvements owned by Seller and
located on the Sunnyvale Land (the "SUNNYVALE IMPROVEMENTS"), and (iii) the
personal property owned by Seller and located on the Sunnyvale Land listed on
EXHIBIT "B-2" attached hereto (collectively, the "SUNNYVALE PERSONAL PROPERTY").
The Sunnyvale Land, Sunnyvale Improvements, and Sunnyvale Personal Property are
herein referred to collectively as the "SUNNYVALE PROPERTY."
C. That certain improved real property located in the City of Santa
Xxxxx, County of Santa Xxxxx, State of California, commonly known as Commerce
Park - San Xxxxx, 0000 Xxxxx Xxxxxxxxx, Xxxxx Xxxxx, Xxxxxxxxxx, consisting of
(i) that certain real property more particularly described in EXHIBIT "C-1"
attached hereto (the "SAN XXXXX LAND"), (ii) any and all improvements owned by
Seller and located on the San Xxxxx Land (the "SAN XXXXX IMPROVEMENTS"), and
(iii) the personal property owned by Seller and located on the San Xxxxx Land
listed on EXHIBIT "C-2" attached hereto (collectively, the "SAN XXXXX PERSONAL
PROPERTY"). The San Xxxxx Land, San Xxxxx Improvements, and San Xxxxx Personal
Property are herein referred to collectively as the "SAN XXXXX PROPERTY."
D. That certain improved real property located in the City of
Sacramento, County of Sacramento, State of California, commonly known as
Commerce Park - Sacramento, 0000 Xxxxxxx Xxxx, Xxxxxxxxxx, Xxxxxxxxxx,
consisting of (i) that certain real property more particularly described in
EXHIBIT "D-1" attached hereto (the "SACRAMENTO LAND"), (ii) any and all
improvements owned by Seller and located on the Sacramento Land (the "SACRAMENTO
IMPROVEMENTS"), and (iii) the personal property owned by Seller and located on
the Sacramento Land and listed on EXHIBIT "D-2" attached hereto (collectively,
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the "SACRAMENTO PERSONAL PROPERTY"). The Sacramento Land, Sacramento
Improvements, and Sacramento Personal Property are herein referred to
collectively as the "SACRAMENTO PROPERTY."
The Anaheim Land, Sunnyvale Land, San Xxxxx Land and Sacramento Land are
sometimes hereinafter referred to collectively as the "LAND" and individually as
a "REAL PROPERTY SITE." The Anaheim Improvements, Sunnyvale Improvements, San
Xxxxx Improvements and Sacramento Improvements are sometimes hereinafter
referred to collectively as the "IMPROVEMENTS." The Anaheim Personal Property,
Sunnyvale Personal Property, San Xxxxx Personal Property and Sacramento Personal
Property are sometimes hereinafter referred to collectively as the "PERSONAL
PROPERTY." The Anaheim Property, Sunnyvale Property, San Xxxxx Property and
Sacramento Property are sometimes hereinafter referred to collectively as the
"PROPERTY" or "PROPERTIES" and individually as a "PROJECT SITE."
The terms and conditions of this Agreement and the instructions to
Chicago Title Insurance Company ("ESCROW HOLDER") with regard to the escrow
("ESCROW") created pursuant hereto are as follows:
1. PURCHASE AND SALE. FOR VALUABLE CONSIDERATION, the receipt and
sufficiency of which are hereby acknowledged, Seller agrees to sell the Property
to Buyer, and Buyer agrees to purchase the Property from Seller, upon the terms
and conditions set forth in this Agreement.
2. PURCHASE PRICE. The purchase price for the Property shall be
Fifty-seven million-six-hundred thousand Dollars ($57,600,000) ("PURCHASE
PRICE"), payable as set forth in this Section 2.
2.1 Initial Deposit. Concurrent with Buyers execution and delivery of
this Agreement to Seller, Buyer shall deposit or cause to be deposited with
Escrow Holder in good and immediately available federal funds, the sum of Six
Hundred Twenty-Five Thousand Dollars ($625,000.00) ("INITIAL DEPOSIT"), which
Initial Deposit (together with all accrued interest thereon) shall be applied
toward payment of the Purchase Price upon the Close of Escrow (as hereafter
defined). If Buyer fails to timely deliver the Initial Deposit in accordance
with this Section, Seller shall have the unilateral right at any time to
terminate this Agreement by delivery of written termination notice to Buyer and
Escrow Holder. On the Contingency Date (as defined in Section 5.2 hereof),
unless Buyer has timely elected to terminate this Agreement and the Escrow
pursuant to and in accordance with Section 5 hereof, Escrow Holder is
irrevocably authorized and instructed, without further instructions from Buyer,
to immediately release the Initial Deposit to Seller. Buyer acknowledges that
the Initial Deposit shall be released to Seller prior to the Closing, and Buyer
releases the Escrow Holder from all liabilities and claims arising out of Escrow
Holder's compliance with the terms of this Section 2.1.
2.2 Additional Deposit.
(a) On the Contingency Date (as defined in Section 5.2 hereof),
unless Buyer has timely elected to terminate this Agreement and the Escrow
pursuant to and in accordance with Section 5 hereof, Buyer shall deposit with
Escrow Holder in good and immediately available federal funds the additional
amount of One Million Two
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Hundred Fifty Thousand Dollars ($1,250,000.00) (the "ADDITIONAL DEPOSIT"), and
Escrow Holder is irrevocably authorized and instructed, without further
instructions from Buyer, to immediately upon receipt release the Additional
Deposit to Seller. Buyer acknowledges that the Additional Deposit shall be
released to Seller prior to the Closing, and Buyer releases the Escrow Holder
from all liabilities and claims arising out of Escrow Holder's compliance with
the terms of this Section 2.2. The Additional Deposit and the Initial Deposit
totaling One Million Eight Hundred Seventy-Five Thousand Dollars ($1,875,000)
are collectively referred to herein as the "DEPOSIT," and the term Deposit shall
include and refer to both the Initial Deposit and, from and after the
Contingency Date, the Additional Deposit. The Additional Deposit shall for all
purposes be treated the same as the Initial Deposit.
(b) If Buyer fails to timely deliver the Additional Deposit in
accordance with this Section, Seller shall have the unilateral right to
terminate this Agreement and the Escrow by delivering written termination notice
to Buyer and Escrow Holder at any time. In the event Seller terminates this
Agreement and the Escrow pursuant to this Section, the Initial Deposit shall be
released to Seller in accordance with Section 2.1 above on the Contingency Date
(if not already released) and retained by Seller in accordance with Section 34
of this Agreement as Seller's sole remedy for Buyer's breach of this Section.
2.3 CLOSING FUNDS. Not later than 10:00 a.m. Pacific Time one (1)
Business Day prior to the Close of Escrow, Buyer shall deposit or cause to be
deposited with Escrow Holder, in the form of a confirmed wire transfer of
immediately available federal funds, the balance of the Purchase Price, plus
such amounts, if any, in immediately available funds as may be required to pay
Buyer's share of prorations and closing costs as hereinafter set forth.
2.4 INTEREST ON DEPOSITS. Pending the release of the Initial Deposit
to Seller, all funds received from Buyer shall be deposited by Escrow Holder in
an interest-bearing account with a federally-insured state or national bank or
savings and loan association (the "Account"). All interest on funds in the
Account shall accrue for the benefit of Buyer (provided that Buyer provides an
acceptable Form 1099 to Escrow Holder) and shall be held in Escrow as part of
the Initial Deposit. Seller shall have no obligation to pay or credit Buyer with
any interest on the Initial Deposit or the Additional Deposit whether or not
released to Seller, except that Buyer shall receive a credit for interest on the
Initial Deposit held in the Account which accrues prior to the release of such
funds to Seller pursuant to Section 2.1 above.
3. Escrow.
3.1 OPENING OF ESCROW. By not later than 5:00 p.m. Pacific Time
on the first (1st) Business Day after this Agreement is executed by Buyer and
Seller, Buyer and Seller shall open the Escrow with Escrow Holder by delivering
or causing to be delivered to Escrow Holder (a) a fully executed original of
this Agreement (or executed original counterparts of this Agreement); and (b)
Escrow Holder's standard escrow provisions in the form attached hereto as
EXHIBIT "3.1" (the "STANDARD PROVISIONS"). Provided the Escrow Holder has
received the Initial Deposit in accordance with Section 2.1 above, the deposit
with Escrow Holder of the documents described in the preceding sentence shall
constitute the opening of Escrow (the "OPENING OF ESCROW") and authorization to
Escrow Holder to act in accordance with the terms of this Agreement. In the
event of any inconsistencies between
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the terms and conditions of the Standard Provisions and the terms of this
Agreement, the terms of this Agreement shall control.
3.2 CLOSING. For purposes of this Agreement, the "CLOSING" or "CLOSE
OF ESCROW" shall be defined as the date that the Grant Deeds, the form of which
are attached hereto as EXHIBIT "3.2" ("DEEDS"), conveying the Land and
Improvements to Buyer, are recorded in the Official Records of Orange County,
Santa Xxxxx County and Sacramento County, respectively, State of California and
the Purchase Price is received by Seller. This Escrow shall close on the
following date (the "Original Closing Date") (a) January 6, 1998; or (b) such
earlier date as Buyer and Seller may agree upon in writing. Not later than two
(2) Business Days before the Closing Date (as defined in Section 4 below),
Seller shall prepare and submit to Escrow Holder and Buyer a proforma closing
statement setting forth the estimated adjustments and prorations; as of the
scheduled Closing Date (the "PRORATION SCHEDULE", which adjustments and
proration shall be calculated in accordance with Section 11 below. Escrow Holder
is authorized and instructed to base its final adjustments and prorations on the
Proration Schedule.
4. EXTENSION OF ORIGINAL CLOSING DATE. Seller, at its option but without
any obligation to do so, shall have the right to extend the Original Closing
Date for three (3) consecutive periods of up to thirty (30) days each
(collectively, the "EXTENSION OPTIONS"). If Seller elects to exercise an
Extension Option, Seller shall do so by delivering written notice (the
"EXTENSION NOTICE") of Seller's election to exercise such Extension Option to
Buyer and Escrow Holder not later than five (5) Business Days prior to the
Original Closing Date or the then existing Closing Date, as applicable. The
Extension Notice shall specify the new Closing Date. For purposes of this
Agreement, the term "CLOSING DATE" shall mean the Original Closing Date, as the
same may be extended in accordance with this Section 4. Notwithstanding anything
to the contrary contained in this Agreement, Seller shall have no obligation to
exercise any or ail of the Extension Options, and the Extension Options may be
exercised by Seller in its discretion.
5. BUYER'S EXAMINATION/REVIEWS/INSPECTIONS.
5.1 BUYER'S APPROVALS. The Close of Escrow is subject to and
contingent on the satisfaction of the following conditions within the applicable
time periods set forth in this Section 5 for the satisfaction of such
conditions:
(a) TITLE EXAMINATION. Buyer's approval of preliminary title
reports issued by Chicago Title Insurance Company ("TITLE COMPANY") for the Real
Property Sites together with copies of all exceptions set forth therein
(collectively, the "REPORTS"). Escrow Holder is authorized and instructed to
cause the Reports to be delivered to Buyer within ten (10) Business Days after
the Opening of Escrow. If, on or before fifteen (15) days following Buyer's
receipt of the Reports, Buyer delivers to Seller written notice disapproving any
items therein described (other than the Title Company's standard exceptions),
Seller shall thereafter have the right, in its discretion but without any
obligation to do so, to elect to attempt to cure such matters as Buyer shall
have so disapproved on or before thirty (30) days following Seller's receipt of
Buyer's written disapproval notice. Seller shall give a written notice to Buyer
within said thirty (30) day period stating whether or not Seller elects to
attempt to cure said disapproved matters. If Seller fails to give written notice
within such thirty (30) day period that Seller elects to attempt to cure such
disapproved matters, Seller shall be deemed to have elected not to attempt to
cure such matters. If Seller notifies (or is
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deemed to have notified) Buyer that it elects not to attempt to cure any such
disapproved matters, Buyer shall have the right, by a writing delivered to
Seller and Escrow Holder on or before the date which is three (3) Business Days
following the date Buyer receives Seller's notice electing not to cure or the
date on which Seller is deemed to have elected not to cure if Seller provides no
notice, whichever occurs first, to terminate the Escrow and this Agreement by
giving written notice of such termination to Seller and Escrow Holder within
such three (3) Business Day period. If Seller notifies Buyer that Seller elects
to attempt to cure any such disapproved matter, and Seller thereafter determines
in its discretion that it is unable or unwilling to continue to attempt to cure
any such matter, Seller shall notify Buyer of such fact (the "Cure Cessation
Notice") not later than seven (7) Business Days before the Closing Date, Buyer's
sole and exclusive right in the event that Seller so notifies Buyer is to
terminate the Escrow and this Agreement by giving written notice to Seller and
Escrow Holder on or before the date which is three (3) Business Days following
the date Buyer receives the Cure Cessation Notice. Buyer's failure to timely
give any written disapproval in accordance with this Section 5.1 conclusively
shall be deemed Buyer's approval of all matters set forth on the Reports, other
than delinquent taxes and Seller's mortgages which Seller shall remove on or
before the Closing Date, and Buyers failure to timely deliver a written
termination notice following (i) Seller's election not to attempt to cure any
disapproved items, or (ii) Seller's delivery to Buyer of the Cure Cessation
Notice, conclusively shall be deemed Buyer's waiver and approval of all such
previously disapproved matters in accordance with this Section.
(b) BUYER'S REVIEWS. Buyer's approval of the documents and items
set forth in this Section 5.1 (b) ("REVIEW MATTERS") by no later than 5:00 p.m.
Pacific Time on November 20th, 1997 (the "CONTINGENCY DATE"). Seller shall make
the Review Matters available to Buyer within five (5) days after the Opening of
Escrow; provided, however, that the Review Matters shall only be available to
the extent such items exist (either copies or originals) and are located either
at Seller's property management office at the Improvements or at the Seller's
office at 0000 Xxxxxxx, Xxxxxx Xxxxx, Xxx Xxxxxxx Xxxxxxxxxx ("REVIEW
LOCATIONS"). Further, the Review Matters shall only be available at the Review
Locations for copying and inspection by Buyer at Buyer's expense and upon prior
reasonable notice to Seller, and the Review Matters may not be removed from such
locations. If Buyer, on or before the Contingency Date, fails to disapprove, in
a writing delivered to Seller and Escrow Holder, any of the following Review
Matters, Buyer conclusively shall have been deemed to have approved all such
Review Matters and all information contained or referred to therein:
(i) All existing leases and amendments thereto currently
affecting the Land and Improvements ("LEASES");
(ii) Plans and specifications for the Improvements;
(iii) All existing service agreements, maintenance
agreements, brokerage contracts, and listing agreements currently affecting the
Land and Improvement which will survive the Closing Date, all of which the
Property shall be subject to when the Property is transferred to Buyer on the
Closing Date (collectively, the "CONTRACTS");
(iv) A schedule or schedules ("Rent Roll") prepared by
Seller containing (A) the names of the tenants, identification of the premises,
and current rental income payable under each of the Leases; (B) expiration date
of each of the Leases;
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and (C) the amount of any security deposits currently held by Seller under each
of the Leases (the "Tenant Security Deposits"); and
(v) The most recent real property tax statements for the
Land and Improvements;
(vi) A general description of the Personal Property, if
Exhibits X-0, X-0, X-0 and D-2 indicate that the description of the Personal
Property is to be provided by Seller after the date of this Agreement;
(vii) Operating statements for the Property prepared by or
for Seller in the ordinary course of business for the eighteen (18) month period
preceding the date of the Opening of Escrow; and
(viii) Such other books, records, documents, and other
information relating to the Property which Seller makes available at the Review
Locations for Buyer's examination or which Seller has otherwise delivered or
caused to be delivered to Buyer.
Seller makes no representations or warranties of any kind, either express or
implied, including without limitation as to the accuracy and/or content, with
regard to any of the foregoing Review Matters. Buyer agrees and acknowledges
that each and all of the Review Matters are confidential, and Buyer covenants
and agrees not to report, publish, share, circulate, disseminate or otherwise
reveal or cause or permit to be reported, published, shared, circulated,
disseminated or otherwise revealed, to any party, person or entity any or all of
the Review Matters or any information therein or item or circumstance relating
thereto, except to Buyer's contractors and advisors as and only to the extent
necessary for this transaction. Further, prior to delivery of any of the
foregoing to such contractors and advisors, Buyer (i) shall inform each and
every such party that such information is confidential and is subject to a
prohibition on further dissemination or circulation by any means and may only be
used as necessary for Buyer's review purposes pursuant to this Section 5.1 (b)
relating to this transaction; and (ii) shall obtain such party's agreement to
maintain the confidentiality of the Review Matters in accordance with the terms
of this Agreement. In the event this Agreement terminates for any reason, and as
a condition to the release of the Deposit to Buyer if Buyer is otherwise
entitled to such release under this Agreement, Buyer shall return to Seller all
Review Matters previously provided to or obtained by or on behalf of Buyer or
any of its agents from or at Seller's direction, without Buyer maintaining any
copies thereof. Buyer agrees that if the confidentiality provisions contained in
this Section 5.1(b) are breached, the remedy at law may be inadequate and,
therefore, without limiting any other remedy available at law or equity, an
injunction, specific performance or other forms of equitable relief, or any
combination thereof, shall be available to Seller.
(c) BUYER'S INSPECTION. Buyer's approval of a physical inspection
of the Property on or before the Contingency Date, including all conditions
relating to the presence, existence, or use of Hazardous Materials (as such term
is defined in Section 16 below) on or under the Property. Buyer and its agents
shall have the right to make up to three (3) visits of no more than two (2)
consecutive days each to each Project Site during normal business hours at a
time mutually acceptable to Buyer and Seller and upon not less than forty-eight
(48) hours prior written request to Seller, to make, at Buyer's sole cost and
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expense, those inspections and surveys of the Property as Buyer may desire;
provided, however, that without Seller's prior written consent (which consent
may be withheld in Seller's discretion), Buyer shall not be entitled (1) to
perform or cause to be performed any invasive or destructive actions, punctures
or drilling of any kind; and (2) to initiate any inquiry or request (including
any inquiry or request relating to any zoning variance, zone change, or
conditional use permit) directed at any governmental official with respect to
the Property; provided, however, that nothing in this clause (2) shall be deemed
to prevent Buyer from inspecting or reviewing any or all records of any federal,
state, or local governmental authority. Buyer shall not be entitled to enter the
Property without being accompanied by a designated representative of Seller.
Buyer shall use all due care and consideration in connection with its
inspections and shall comply with all applicable laws. Buyer shall immediately
repair any and all damage resulting from the acts or omissions of Buyer or
Buyer's agents, employees, contractors, representatives or subcontractors
relating to the whole or any part of the Property. Buyer shall indemnify, defend
and hold Seller harmless from and against any and all expenses, costs, fees,
suits, actions, obligations, liabilities and damages (including attorneys' fees
and costs) directly or indirectly resulting from such entry, acts or omissions
by Buyer, its agents, employees, representatives, contractors or subcontractors.
Buyer shall not cause or permit in any way any liens or encumbrances upon or
relating to any Property or any interest therein as a result of Buyer's or
Buyer's agents', employees', contractors', subcontractors' or representatives'
acts or omissions with regard to the Property. Buyer may, not later than the
Contingency Date, give a written termination notice to Seller disapproving (with
specific detail) the results of any such surveys and inspections. If Buyer does
not timely give notice of disapproval as aforesaid, then Buyer conclusively
shall be deemed to have approved the results of the inspections and the
condition of the Property. Any qualified or conditional approval of any of the
matters set forth in this Section 5.1(c) shall conclusively be deemed to
constitute Buyer's disapproval of such matter. Commencing with Buyer's execution
of this Agreement and at all times prior to the Close of Escrow, Buyer shall
have in effect workers compensation and employer's liability insurance with
statutory limits of coverage as required by law, and with a limit of liability
for coverage B of at least $1,000,000 each occurrence/aggregate, and commercial
general liability insurance naming Seller as an additional insured, with (i)
commercially reasonable coverage; (ii) waiver of subrogation; and (iii) limits
of not less than $1,000,000 combined single limit for bodily and personal injury
and property damage. Prior to entering the Property, Buyer shall deliver to
Seller certificates of insurance evidencing such coverage and further evidencing
that such coverage may only be terminated or modified upon thirty (30) day's
prior written notice to Seller. Buyer's indemnity, defense and other obligations
and covenants in this Section shall survive any termination of this Agreement or
the Closing, as applicable.
5.2 FUNDING APPROVAL. The obligations of Buyer under this Agreement
are not subject to or contingent upon in any way Buyers receipt of approval of
funding or obtaining any financing from any source, and Buyer covenants and
agrees to pay the Purchase Price in all cash regardless of any financing
arrangements Buyer may pursue.
5.3 TERMINATION. This Agreement and the Escrow shall terminate upon
(a) Buyer's disapproval of any of the matters described in Sections 5.1(a)
(subject to Seller's right to cure disapproved title matters), 5.1(b) or 5.1(c)
above or Section 14.1, below within the applicable time periods set forth in
such Sections; or (b) failure of the condition set forth in Section 8.1.3 below
to occur within the applicable time period set forth in such Section, and
Buyer's failure to waive such condition. Upon any termination of this Agreement
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pursuant to this Section 5.3, or pursuant to Section 9 below, (i) each party
shall execute such documents as Escrow Holder may reasonably require to evidence
such termination, (ii) Escrow Holder shall return all documents to the party who
deposited them, (iii) Escrow Holder shall return to Buyer all funds held in
Escrow previously deposited in Escrow by Buyer (plus any accrued interest to
which Buyer is entitled), less Escrow Holder's, termination fees and the Title
Company's cancellation fees, (iv) Buyer shall return to Seller all documents
delivered to it by Seller relating to the Property, (v) Seller shall return to
Buyer any portion of the Deposit previously delivered to Seller, and (vi) except
as specifically set forth in this Agreement, all of the respective obligations
of Buyer and Seller relating to this Agreement and the Property shall terminate.
5.4 ALLOCATION OF PURCHASE PRICE. Not later than ten (10) Business
Days prior to the Contingency Date, Seller shall have the right to provide Buyer
with a written statement showing Seller's allocation of the Purchase Price among
each of the Properties (the "Allocation Schedule"). If Seller elects to provide
the Allocation Schedule to Buyer, then Buyer shall report the transactions
contemplated by this Agreement for state and federal tax purposes in a manner
consistent with the allocation of the Purchase Price shown in the Allocation
Schedule.
5.5 NO OBLIGATION BY SELLER TO CORRECT DEFECTS. WITHOUT LIMITING ANY
OF THE OTHER TERMS OF THIS AGREEMENT, BUYER ACKNOWLEDGES AND AGREES THAT SELLER
SHALL HAVE NO OBLIGATION OF ANY KIND TO CORRECT OR OTHERWISE ADDRESS ANY
DEFICIENCY OR DEFECT OF ANY KIND WHICH BUYER CLAIMS TO EXIST BASED UPON BUYER'S
INSPECTION OR REVIEW OF ANY OR ALL OF THE MATTERS WHICH ARE THE SUBJECT OF THIS
SECTION 5.
6. DEPOSITS BY SELLER. Seller shall execute and acknowledge (where
appropriate), and deposit with Escrow Holder not later than 2:00 p.m. Pacific
Time one Business Day prior to the Closing Date for delivery to Buyer upon the
Closing Date or, if applicable, for recordation upon the Closing Date the
following documents and instruments:
(a) The Deeds conveying the Land and Improvements to Buyer;
(b) An Assignment of Leases ("ASSIGNMENT OF LEASES"), the form of
which is attached hereto as EXHIBIT "6(b)," pursuant to which (i) Seller assigns
to Buyer all of Seller's right, title and interest in and to the Leases; and
(ii) Buyer assumes Seller's obligations under the Leases as of the Closing Date;
(c) The Contracts;
(d) An Assignment of Contracts ("ASSIGNMENT OF CONTRACTS"), the form
of which is attached hereto as EXHIBIT "6(d)", pursuant to which (i) Seller
assigns to Buyer all of Seller's right, title and interest in and to the
Contracts; and (ii) Buyer assumes all of Seller's obligations under such
Contracts as of the Closing Date;
(e) A Xxxx of Sale ("XXXX OF SALE"), the form of which is attached
hereto as EXHIBIT "6(e)", conveying all of Seller's right, title and interest in
and to any and all Personal Property; and
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(f) A Certification of Non-Foreign Status, executed by Seller
pursuant to Section 1445 et seq. of the Internal Revenue Code of 1986, as
amended, the form of which is attached hereto as EXHIBIT "6(f)".
7. DEPOSITS BY BUYER. Buyer shall deposit or cause to be deposited with
Escrow Holder the funds which are to be applied towards the payment of the
Purchase Price in the manner and in the amounts and at the times designated in
Section 2 above, less the aggregate of all unapplied Tenant Security Deposits
and increased or decreased by such other adjustments resulting from the
prorations conducted pursuant to this Agreement and reflected on the Proration
Schedule. In addition, Buyer shall execute and acknowledge where appropriate and
deposit with Escrow Holder not later than one (1) Business Day prior to the
Closing Date for delivery to Seller upon the Closing Date counterparts of (i)
the Assignment of Leases, and (ii) the Assignment of Contracts.
8. CONDITIONS OF CLOSING.
8.1 BUYER'S CONDITIONS. In addition to the other terms and provisions
of this Agreement which give Buyer the express right to terminate this Agreement
and the Escrow created pursuant to this Agreement, Buyer's obligation to
purchase the Property from Seller at the Close of Escrow shall be subject to the
satisfaction of the following conditions (or Buyer's written waiver thereof, it
being agreed that Buyer may waive any or all of such conditions) within the
applicable periods set forth in this Agreement for the satisfaction of such
conditions:
8.1.1 TITLE INSURANCE. It shall be a condition to Buyer's
obligation to purchase the Property at the Close of Escrow that, on the Closing
Date, the Title Company be prepared and committed to issue to Buyer a CLTA
Standard Coverage Owner's Title Insurance Policy for each of the Real Property
Sites (collectively "TITLE POLICIES" and individually "TITLE POLICY"), each
written with liability in the amount of that portion of the Purchase Price
allocated to the applicable Project Site pursuant to Section 5.4 above, showing
fee title vested in Buyer, subject only to (i) liens to secure payment of
general and special property taxes, not delinquent, (ii) supplemental taxes, if
any, assessed pursuant to the provisions of Part 0.5, Chapter 3.5 or Part 2,
Chapter 3, Articles 3 and 4, respectively (commencing with Section 75) of the
California Revenue and Taxation Code; (iii) the Title Company's standard and
customary exceptions set forth in said Title Policy, (iv) matters affecting the
condition of title created by, with the consent of, or which attach through
Buyer or as a result of Buyer's or Buyer's agents', employees', contractors' or
representatives' activities, (v) the Leases and all matters relating to
tenants-in-possession under the Leases, (vi) the Contracts, and (vii) those
title matters approved or waived (or deemed approved or waived) by Buyer
pursuant to Section 5 above;
8.1.2 DELIVERY OF DOCUMENTS BY SELLER. Seller shall have
delivered or caused to be delivered to the Escrow Holder all of the documents
described in Section 6 above; and
8.1.3 TENANT ESTOPPEL CERTIFICATES. Buyer shall have received
tenant estoppel certificates substantially in the form of EXHIBIT "8.1.3"
attached hereto or in a form containing information substantially comparable to
the information contained in EXHIBIT "8.1.3" attached hereto (collectively, the
"ESTOPPEL CERTIFICATES") from tenants under the Leases (collectively, the
"TENANTS") who, collectively, occupy a total of at
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least sixty percent (60%) of the total rentable square footage in the
Improvements occupied by all Tenants as of the Opening of Escrow (the "TARGET
PERCENTAGE"). Seller shall use its reasonable efforts to deliver the Target
Percentage of completed Estoppel Certificates to Buyer on or before the date
which is ten (10) days prior to the Closing Date (the "ESTOPPEL DELIVERY
DATE"); provided, however, that (i) Seller conclusively shall be deemed to have
used its reasonable efforts to deliver the Target Percentage of Estoppel
Certificates to Buyer in accordance with this Section if Seller has submitted a
written request to Tenants who, collectively, occupy at least sixty percent
(60%) of the total rentable square footage in the Improvements occupied by
Tenants as of the Opening of Escrow requesting that each of such Tenants
complete, sign and return an Estoppel Certificate to Seller not later than one
(1) day before the Estoppel Delivery Date; and (ii) Seller shall have no
liability of any kind to Buyer as a result of Seller's failure for any reason to
obtain or deliver any or all of the Estoppel Certificates to Buyer pursuant to
this Section, as long as (A] Seller has complied with clause (i) of this Section
8.1.3; and [B] Seller delivers to Buyer all signed and completed Estoppel
Certificates actually received by Seller from the Tenants as of the last
Business Day prior to the Estoppel Delivery Date. If Seller determines that it
is unable to obtain an Estoppel Certificate from one or more Tenants, Seller, in
its discretion but without any obligation to do so, shall have the right to
deliver to Buyer on or before the Estoppel Delivery Date Seller's written
certification as to the truth and accuracy of the matters set forth in the
Estoppel Certificate for any or all Tenants who have not executed an Estoppel
Certificate (such certification by Seller is referred to as a "Substitute
Estoppel Certificate"), and any such Substitute Estoppel Certificates shall be
accepted by Buyer in lieu of Estoppel Certificates, signed by the applicable
Tenants, provided that the information contained in such Substitute Estoppel
Certificates is consistent with the information in the applicable Leases which
have been approved by Buyer. Nothing contained in this Section shall be deemed
to obligate Seller to make any monetary payment or pay any other consideration
of any kind to a Tenant in order to obtain an Estoppel Certificate from such
Tenant. If Seller fails to deliver the Target Percentage of Estoppel
Certificates (including any Substitute Estoppel Certificates) to Buyer by the
Estoppel Delivery Date (the delivery of the Target Percentage of Estoppel
Certificates (including any Substitute Estoppel Certificates) is referred to as
the "ESTOPPEL CONDITION"), Buyer may give written notice to Seller and Escrow
Holder on or before 5:00 p.m. Pacific Time on the day which is two (2) Business
Days after the Estoppel Delivery Date (the "ESTOPPEL NOTICE DATE") of Buyer's
election to terminate this Agreement based on the failure to satisfy the
Estoppel Condition. Upon such notification by Buyer, this Agreement and the
Escrow shall terminate, subject to the remaining terms of this Section. Buyer's
failure to notify Seller and Escrow Holder that the Estoppel Condition has not
been satisfied within the time period described in this Section conclusively
shall be deemed to constitute Buyer's waiver of the Estoppel Condition. Buyer's
sole and exclusive right in the event that the Estoppel Condition is not
satisfied shall be to terminate this Agreement in accordance with this Section.
If the Estoppel Condition is not satisfied and Buyer elects to terminate this
Agreement, then notwithstanding anything to the contrary contained in this
Agreement, this Agreement and the Escrow shall not terminate and shall remain in
full force and effect, and the Estoppel Condition shall be deemed to be
satisfied, if (1) within two (2) Business Days after the Estoppel Notice Date,
Seller, in its discretion but without any obligation to do so, delivers to Buyer
Substitute Estoppel Certificates which, when considered together with the signed
Estoppel Certificates and any other Substitute Estoppel Certificates previously
delivered to Buyer, will result in Buyer having received the Target Percentage
of Estoppel Certificates (including any Substitutes Estoppel Certificates); and
(2) the information contained in such Substitute Estoppel Certificates is
consistent with the information in the applicable Leases which have been
approved by Buyer. The certifications by Seller
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contained in any and all Substitute Estoppel Certificates shall expire and
terminate upon Buyer's subsequent receipt of an Estoppel Certificate signed by
the applicable Tenant containing information which is consistent with Seller's
certifications. Nothing contained in this Section shall be deemed to obligate
Seller to provide Buyer with any Substitute Estoppel Certificate or other
certification with respect to any unsigned Estoppel Certificate, and Seller may
decline to provide any such Substitute Estoppel Certificate or certification to
Buyer in Seller's discretion.
If any of the foregoing are not timely satisfied or waived by Buyer,
Buyer shall have the right to terminate this Agreement on the Closing Date by
delivering written termination notice to Seller.
8.2 SELLER'S CONDITION. In addition to the other terms and provisions
of this Agreement which give Seller the right to terminate this Agreement and
the Escrow created pursuant hereto, Seller's obligation to sell the Property to
Buyer shall be subject to the satisfaction of the following condition (or
Seller's written waiver thereof, it being agreed that Seller may waive such
condition): As of the Closing Date, Buyer shall have delivered or caused to be
delivered to the Escrow Holder all of the documents and funds described in
Sections 2 and 7 above, including the full Purchase Price. If the foregoing is
not timely satisfied or waived by Seller, Seller shall have the right to
terminate this Agreement on the Closing Date by delivering written termination
notice to Buyer.
9. DAMAGE OR CONDEMNATION PRIOR TO CLOSING. This Agreement is subject to
the provisions of California Civil Code Sections 1662 (the "Statute").
9.1 CONDEMNATION. For the purposes of the Statute, a taking by
eminent domain of a portion of the Property shall be deemed to affect a
"material part" of the Property if (a) the taking would result in the inability
to occupy any or all of the rentable space in the Improvements: (b) the taking
would materially interfere with access to the Property; or (c) the taking would
reduce the number of parking spaces now located on the Property. In the event of
a taking of a "material part" of the Property prior to the Closing Date, Buyer
and Seller shall each have the right to terminate this Agreement by giving
written notice to Escrow Holder and the other party within three (3) Business
Days after the party giving such notice learns of such taking. In the event of a
taking by eminent domain of less than a "material part" of the Property, this
Agreement shall remain in full force and effect, and Buyer and Seller shall
proceed to the Close of Escrow without reduction or abatement of the Purchase
Price, except that Seller shall assign to Buyer all of Seller's rights against
the condemning authority at the Close of Escrow. Seller shall execute such
documents or instruments as may reasonably be required to effect such an
assignment. Any such assignment shall be without representation or warranty by,
or recourse to, Seller.
9.2 CASUALTY LOSS.
9.2.1 CASUALTY OVER $1,000,000. For the purposes of the Statute,
a casualty shall be deemed to be "material" if the estimated cost of repair of
such casualty exceeds $1,000,000. In the event of any casualty to the Property
prior to the Close of Escrow having an estimated cost of repair which equals or
exceeds $1,000,000, Buyer and Seller shall each have the right to terminate this
Agreement by giving written notice to Escrow Holder and the other party within
three (3) Business Days after the party giving such notice learns of such
casualty and the estimated cost of repair thereof. In the event Buyer or
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Seller terminates this Agreement because of such casualty, the Escrow shall
terminate in accordance with Section 5.6 above. If neither Buyer nor Seller
elects to terminate this Agreement, then this Agreement shall remain in full
force and effect and there shall be no reduction or abatement in the Purchase
Price of the Property, except that Seller shall, at the Close of Escrow, assign
to Buyer all insurance proceeds payable with respect to such casualty under the
policies of insurance maintained by Seller and credit Buyer with the lesser of
(i) the amount of any applicable deductible under such policies; or (ii) an
amount equal to the estimated cost of repair of such casualty. Any such
assignment shall be without representation or warranty by, or recourse to,
Seller.
9.2.2 CASUALTY UNDER $1,000,000. In the event of a casualty to
the Property prior to the Close of Escrow having an estimated cost of repair
which is less than $1,000,000, this Agreement shall remain in full force and
effect and there shall be no reduction or abatement in the Purchase Price of the
Property, except that Seller shall, at the Close of Escrow, assign to Buyer all
insurance proceeds payable with respect to such casualty under the policies of
insurance maintained by Seller and credit Buyer with the lesser of ((a) the
amount of any applicable deductible under such policies; or (b) an amount equal
to the estimated cost of repair of such casualty. Any such assignment shall be
without representation or warranty by, or recourse to, Seller.
9.2.3 COST OF REPAIR. For purposes of this Section 9.2, the
phrase "estimated cost of repair" shall mean an estimate obtained from a
reputable independent contractor selected by Seller and approved by Buyer, which
approval Buyer agrees not to unreasonably withhold or delay. In the event of a
casualty to the Property prior to the Close of Escrow, the Closing Date shall
automatically be extended by a period equal to five (5) Business Days plus the
period of time reasonably required for Seller to obtain an estimate of the cost
of repair of such casualty (which period of time shall not exceed thirty (30)
days).
9.2.4 INSURANCE. Pending the Close of Escrow, Seller, at its
expense, shall maintain the existing standard fire and extended coverage
insurance policies or maintain comparable casualty insurance coverage; provided,
however, that Seller shall have no obligation to modify or supplement any
existing insurance policies.
10. COSTS AND EXPENSES.
10.1 SELLER'S COSTS. Seller shall pay (a) one-half of Escrow Holder's
fees (except upon termination of this Agreement pursuant to Section 5 above, in
which case Escrow Holder's cancellation fee shall be paid by Buyer); (b)
one-half of the county documentary transfer taxes for the Deeds; (c) one-half of
any city documentary transfer taxes; (d) the cost of the Title Policies; and (e)
any other closing costs customarily charged to sellers for recording documents.
10.2 BUYER'S COSTS. Buyer shall pay (a) one-half of Escrow Holder's
fees (except upon termination of this Agreement pursuant to Section 5 above, in
which case Escrow Holder's cancellation fee shall be paid by Buyer); (b) any
other closing costs customarily charged to buyers for document preparation,
recording documents, and miscellaneous items; (c) Buyer's pro rata portion of
taxes and other items pursuant to the prorations described in Section 11 of this
Agreement; (d) one-half of the county documentary transfer taxes for the Deeds;
(e) one-half of any city documentary transfer taxes; and (f) the
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cost of any endorsements to the Title Policy requested by Buyer and the
additional cost of ALTA owner's policies of title insurance, if Buyer desires to
obtain such a policies in place of the Title Policies; provided, however, that
the issuance of any such endorsements and the issuance of ALTA owner's policies
of title insurance shall not constitute conditions or contingencies to the Close
of Escrow or delay the Closing Date.
11. PRORATIONS CREDITS. All prorations under this Section (i) shall be
made as of 12:00 midnight on the day immediately preceding the Close of Escrow
(the "Proration Cutoff'); and (ii) shall be made on the basis of a thirty (30)
day month. The following items shall be credited to the parties or shall be
prorated by the parties as of the Close of Escrow, as applicable, with the
Seller responsible for expenses and entitled to revenues accruing prior to the
Proration Cutoff, and Buyer responsible for expenses and entitled to revenues
accruing after the Proration Cutoff:
(a) Escrow Holder shall prorate the real estate taxes with respect to
the Land and Improvements for the current fiscal year as of the Close of Escrow
based upon the most current real estate tax information available:
(b) Buyer and Seller acknowledge that if there has been completion of
construction of improvements to the Property, additional or supplemental taxes
("Supplemental Taxes") may be assessed against the Property pursuant to Chapter
498, Statutes of 1983, of the State of California. Any xxxx for Supplemental
Taxes which is not provided to Escrow Holder or which is issued after the Close
of Escrow shall be prorated between Buyer and Seller outside of Escrow after the
Close of Escrow, and Escrow Holder shall have no liability or responsibility
whatsoever with respect to such Supplemental Taxes. Buyer shall remit its pro
rata share of any such Supplemental Taxes, as reasonably determined by Seller,
to Seller outside of Escrow within ten (10) days after Buyer's receipt of a copy
of the xxxx for such Supplemental Taxes;
(c) Rents and other receivables under the Leases (collectively,
"Rents") shall be prorated based on the Proration Schedule delivered to the
Escrow Holder. If Seller collects any Rents after the Closing which are
attributable to any period of time from and after the Closing Date, Seller shall
remit such Rents directly to Buyer. If Buyer collects any Rents after the Close
of Escrow which are attributable to any period of time prior to the Close of
Escrow, Buyer shall promptly remit such Rents directly to Seller. If Seller has
been unable to collect all Rents due and owing for periods preceding the Close
of Escrow, Buyer shall use its reasonable efforts (without obligation to
institute or prosecute any litigation) to collect such amounts from the
applicable Tenants which are in occupancy as of the Close of Escrow and upon
collection thereof shall remit the same to Seller (net of all reasonable costs
of collection incurred by Buyer);
(d) Utilities, services, operating and all other expenses with
respect to the Property shall be prorated based upon the latest available
information, such that Seller shall be responsible for all such costs and
expenses relating to the period up to and including the day prior to the Closing
Date and Buyer shall be responsible for all such costs and expenses relating to
the period from and after the day prior to the Closing Date. Seller shall
endeavor to have all meters read for all utilities servicing the Property
including, without limitation, water, sewer, gas and electricity for the period
to and including the day prior to the Closing Date and shall pay all bills
rendered on the basis of such readings (provided, however, Buyer shall be
responsible for any and all fees and charges relating to the
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changeover of all such services and utilities). If, on the Closing Date, Seller
is unable to have any utility meters read, Buyer and Seller shall estimate the
amount of such bills based on the immediately preceding utility bills. Premiums
for casualty and liability insurance shall not be prorated as Buyer will be
obtaining its own such insurance upon the Closing Date;
(e) Buyer shall be credited and Seller shall be charged with any
Tenant Security Deposits (not actually applied by Seller in accordance with the
Leases prior to the Closing Date in the ordinary course of business) made by the
Tenants under the Leases;
(f) Seller will receive a credit for all prepaid amounts of any type
relating to the Property and refundable deposits, if any, from utilities,
governmental agencies or others relating to or arising from the Property;
(g) Seller shall be responsible for insurance provided up to the
Closing Date;
(h) Income and expenses under the Contracts and all other expenses of
operating the Property which relate to the period prior to the Close of Escrow
shall accrue to or be paid by Seller, as applicable. Income and expenses under
the Contracts and all other expenses of operating the Property which relate to
the period from and after the Close of Escrow shall accrue to or be paid by
Buyer, as applicable; and
(i) Seller shall be credited and Buyer shall be charged with "Buyer's
Total Share of Approved New Lease Costs" (as such term is defined in Section
14.4 below).
If any errors or omissions are made regarding adjustments and prorations
as aforesaid, the parties shall make the appropriate corrections promptly upon
the discovery thereof, provided that the party entitled to the correction makes
a written request for such correction to the other party (accompanied by
reasonably detailed information which substantiates the error) within one
hundred twenty (120) days after the Closing Date. If any estimations are made at
the Closing Date regarding adjustments or prorations (including any with respect
to utility charges, and operating costs and expenses relating to the Property),
the parties shall make the appropriate correction on a mutually acceptable date
which is approximately one hundred twenty (120) days after the Closing Date.
Notwithstanding the previous sentence to the contrary, any adjustment required
with respect to Supplemental Taxes shall be made pursuant to Section 11(b)
above without regard to the time limitations contained in this Section. Any
mutually agreed upon corrected adjustment or proration shall be paid in cash to
the party entitled thereto promptly upon demand.
12. DISBURSEMENTS AND OTHER ACTIONS BY ESCROW HOLDER.
12.1 CLOSING. Upon the Closing Date, Escrow Holder shall promptly
undertake all of the following in the manner indicated:
(a) Disburse to Seller all funds deposited with Escrow Holder by
Buyer towards payment of the Purchase Price for the Property as follows:
(i) Deduct therefrom all items chargeable to the account
of Seller pursuant hereto;
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(ii) The remaining balance of the funds so deposited by Buyer
towards payment of the Purchase Price shall be disbursed to Seller or as Seller
may direct;
(b) Cause the Deeds and any other documents which the parties
hereto may mutually direct, to be recorded in the Official Records of Orange
County, Santa Xxxxx County and Sacramento County, respectively, State of
California;
(c) Disburse from funds deposited by Buyer with Escrow Holder
towards payment of all closing costs chargeable to the account of Buyer pursuant
hereto such monies as are necessary to pay all said closing costs of Buyer, and
disburse the balance of such funds, if any, to Buyer;
(d) Deliver the Title Policies to Buyer.
12.2 DELIVERIES. Upon confirmation of recordation of the Deeds,
Escrow Holder shall:
(a) Deliver to Buyer the counterparts of the Xxxx of Sale,
Assignment of Leases, and Assignment of Contracts executed by Seller;
(b) Deliver to Seller counterparts of the Xxxx of Sale,
Assignment of Leases and Assignment of Contracts executed by Buyer, and
(c) Deliver to both Buyer and Seller copies of all documents
delivered to Escrow Holder or recorded pursuant to this Agreement.
13. OPERATIONS DURING ESCROW. Seller shall (and Seller shall so instruct
the Property Manager to) operate and maintain the Property from and after the
date hereof until the Closing Date in the ordinary course in substantially the
same manner and fashion (other than as may be required as a result of the sale
of the Property) as prior to this Agreement. Notwithstanding anything to the
contrary in this Agreement, from and after the Contingency Date Seller agrees
that it will not (and Seller will instruct the Property Manager not to) without
the prior written consent of the Buyer: (i) enter into any new contract (except
automatic renewals) which affects the Property or goods or services provided to
the Land or Improvements or its tenants ("Operating Contract") having a term
that extends beyond the Closing Date, except for Operating Contracts terminable
by Buyer on not more than thirty (30) days' notice to the respective vendor or
contractor without penalty to Buyer. Buyer will be deemed to have approved
matters submitted to Buyer under this Section 13 for approval if within three
(3) Business Days of notice and request for approval Buyer has not objected to
the proposed action.
14. CONDUCT OF RENTAL ACTIVITY PRIOR TO CLOSING.
14.1 RENTAL ACTIVITY PRIOR TO THE CONTINGENCY DATE. On or before the
Contingency Date, Seller shall have the right to enter into (a) any new Lease
for space in the Improvements ("New Lease"); and (b) any modification or
supplement to any existing lease ("Lease Modification") without Buyer's prior
approval. Within three (3) Business Days after executing any New Lease or Lease
Modification, Seller shall provide Buyer with a copy of such New Lease or Lease
Modification. Buyer shall have the right to approve or
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disapprove such documents as part of the Review Matters by notice given to
Seller and Escrow Holder prior to the later of (i) three (3) Business Days after
Buyer's receipt of such documents; or (ii) the Contingency Date. Buyer's failure
to disapprove any of such documents in the manner described in this Section
within the applicable time period shall conclusively be deemed to constitute
Buyer's approval of such documents. Any conditional or qualified approval by
Buyer of any of such documents shall be deemed to constitute Buyer's approval of
such documents. This Agreement and the Escrow shall terminate upon Buyer's
disapproval of any of such documents within the applicable time period set forth
in this Section.
14.2 RENTAL ACTIVITY AFTER THE CONTINGENCY DATE. Provided that Buyer
is not in default under this Agreement and this Agreement has not been
terminated pursuant to any of the terms of this Agreement, and except as
otherwise provided in this Section, between the Contingency Date and the Closing
Date Seller shall not enter into any New Lease or Lease Modification without
Buyer's approval, which approval shall not be unreasonably withheld.
Notwithstanding the immediately preceding sentence, Seller shall be entitled to
enter into any New Lease or Lease Modification without Buyer's approval,
provided that (a) in the case of a New Lease, the (i) New Lease is prepared on
Seller's standard form of lease agreement, with only such modifications as are
commercially reasonable or not material in nature; (ii) the rental rate for such
New Lease is not less than ninety-five percent (95%) of the asking rental rate
as shown on a pro forma rental rate schedule delivered by Seller to Buyer not
later than five (5) Business Days prior to the Contingency Date (such schedule
is referred to as the "Pro Forma Leasing Schedule"); (iii) the allowance for
costs of tenant improvements to be completed or paid for by Seller under the New
Lease does not exceed the pro forma tenant improvement allowance shown in the
Pro Forma Leasing Schedule; and (iv) the leasing commission payable by Seller in
connection with the New Lease does not exceed the pro forma leasing commission
shown in the Pro Forma Leasing Schedule; and (b) in the case of a Lease
Modification, the Lease Modification is not material in nature. For purposes of
this Section, a Lease Modification which is not material in nature shall be
deemed to include, without limitation, an existing Lease which is renewed or
extended on a month-to-month basis or renewal or extension of an existing Lease
pursuant to the terms of such Lease or notices of renewal or extension given
pursuant to the terms of such Lease. With respect to any New Lease or Lease
Modification which requires Buyer's approval under the terms of this Section,
Buyer shall notify Seller in writing of Buyer's approval or disapproval of each
such New Lease or Lease Modification submitted to Buyer within three (3)
Business Days after Buyer's receipt thereof. Buyer's failure to disapprove any
New Lease or Lease Modification in accordance with the procedure and within the
three-day period specified in this Section shall conclusively be deemed to
constitute Buyer's approval of such New Lease or Lease Modification. Any notice
of disapproval of a New Lease or Lease Modification by Buyer shall set forth
Buyer's specific objections thereto. Any conditional or qualified approval by
Buyer of any New Lease shall be deemed to constitute Buyer's approval of such
New Lease or Lease Modification. Seller shall have the right to submit a New
Lease or Lease Modification to Buyer for approval after Seller's execution
thereof, provided that the New Lease or Lease Modification contains appropriate
conditions regarding Buyer's approval of the New Lease or Lease Modification.
14.3 CERTAIN DEFINITIONS. For purposes of this Section 14, the
following terms shall have the following definitions:
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(a) APPROVED NEW LEASE. "Approved New Lease" means a New Lease
which (i) has been approved or deemed approved by Buyer pursuant to either
Section 14.1 or 14.2 above; or (ii) which Seller is entitled to enter into
without Buyer's approval pursuant to Section 14.2 above.
(b) NEW LEASE COMMISSION. "New Lease Commission" means, with
respect to an Approved New Lease, the total of all leasing commissions paid or
payable by Seller in connection with such Approved New Lease.
(c) TENANT IMPROVEMENT COSTS. "Tenant Improvement Costs" means,
with respect to an Approved New Lease, the total of all tenant improvement costs
paid or payable by Seller in connection with such Approved New Lease.
(d) APPROVED NEW LEASE COSTS. "Approved New Lease Costs" means,
with respect to an Approved New Lease, the total of (i) the New Lease Commission
payable in connection with such Approved New Lease; and (ii) the Tenant
Improvement Costs payable in connection with such Approved New Lease.
(e) APPROVED NEW LEASE TERM. "Approved New Lease Term" means,
with respect to an Approved New Lease, the original term of such Approved New
Lease, expressed in the form of the number of calendar days included in such
original term.
(f) BUYER'S SHARE. "Buyer's Share" means, with respect to an
Approved New Lease, a fraction, (i) the numerator of which is the number of
calendar days in the Approved New Lease Term measured from the Close of Escrow
to the end of the Approved New Lease term; and (ii) the denominator of which is
the Approved New Lease Term.
(g) BUYER'S SHARE OF APPROVED NEW LEASE COSTS. "Buyer's Share of
Approved New Lease Costs" means, with respect to an Approved New Lease, (i)
Buyer's Share (calculated based on the Approved New Lease Term for such Approved
New Lease), multiplied by (ii) the Approved New Lease Costs for such Approved
New Lease.
(h) BUYER'S TOTAL SHARE OF APPROVED NEW LEASE COSTS. "Buyer's
Total Share of Approved New Lease Costs" means to total of Buyer's Share of
Approved New Lease Costs for all Approved New Leases.
14.4 CREDIT TO SELLER FOR BUYER'S TOTAL SHARE OF APPROVED NEW LEASE
COSTS. At the Close of Escrow, Seller shall receive a credit and Buyer shall be
charged for Buyer's Total Share of Approved New Lease Costs.
15. REPRESENTATIONS AND WARRANTIES.
15.1 SELLER'S REPRESENTATIONS. Seller makes the following
representations and warranties, each and all of which are expressly subject to
any and all matters contained or referred to in any or all of the Review Matters
and matters discovered during Buyer's inspections:
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15.1.1 AUTHORITY; BINDING ON SELLER; ENFORCEABILITY. Seller is a
limited liability company and is duly organized, validly existing and in good
standing under the laws of California. Seller has taken all necessary action to
authorize its execution, delivery and performance of, and has the power and
authority to execute, deliver and perform its obligations under, this Agreement
and all related documents executed by Seller in connection herewith and to
consummate all the transactions contemplated hereby and thereby, including the
power and authority to sell, assign and transfer the Property in accordance with
this Agreement.
15.1.2 CONFLICT WITH EXISTING LAWS OR CONTRACTS. The execution
and delivery of this Agreement does not, and the performance by Seller of its
obligations hereunder will not, to Seller's actual knowledge, conflict with any
provision of any law or regulation to which Seller is subject or conflict with
or result in a material breach of or constitute a material default under any of
the terms, conditions or provisions of any enforceable agreement or instrument
to which Seller is a party or which is known to Seller and by which it is bound
or any order or decree applicable and known to Seller, nor will such execution,
delivery and performance result in the creation or imposition of any lien on any
of Seller's assets or properties that could materially and adversely affect the
ability of Seller to discharge its obligations under and complete the
transactions contemplated by this Agreement.
15.2 BUYER'S REPRESENTATION. Buyer makes the following
representations and warranties:
15.2.1 AUTHORITY; ENFORCEABILITY. Buyer is a Maryland corporation
and is duly organized, validly existing and in good standing under the laws of
the state in which Buyer was organized. Buyer has taken all necessary action to
authorize its execution, delivery and performance of, and has the power and
authority to execute, deliver and perform its obligations under, this Agreement
and all related documents and all the transactions contemplated hereby and
thereby.
15.2.2 CONFLICT WITH EXISTING LAWS OR CONTRACTS. The execution
and delivery of this Agreement does not, and the performance by Buyer of its
obligations hereunder will not, to Buyer's actual knowledge, conflict with any
provision of any law or regulation to which Buyer is subject or conflict with or
result in a material breach of or constitute a material default under any of the
terms, conditions or provisions of any enforceable agreement or instrument to
which Buyer is a party or which is known to Buyer and by which it is bound, or
any order or decree applicable and known to Buyer, or result in the creation of
imposition of any lien on any of its assets or property which could materially
and adversely affect the ability of Buyer to discharge its obligations under and
complete the transactions contemplated by this Agreement.
15.2.3 DECISION TO PURCHASE. Buyer is a sophisticated investor,
and Buyer's offer and decision to purchase the Property are based upon its own
independent expert evaluations of the Property, the Review Matters, and other
materials deemed relevant by Buyer and its agents. In entering into this
Agreement, Buyer has not relied upon any oral or written information from
Seller, or any of its respective employees, affiliates, brokers, agents, legal
counsel or other representatives, other than the representations and warranties
set forth in Section 15.1 of this Agreement (subject, however, to the
limitations set forth in Section 21 below). Buyer further acknowledges that no
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employee, agent, broker, legal counsel or other representative of Seller has
been authorized to make, and that Buyer has not relied upon, any statements or
representations other than those specifically contained in Section 15.1 of this
Agreement.
15.2.4 INFORMATION FURNISHED TO SELLER. All information submitted
by or on behalf of Buyer to Seller or Seller's agents in connection with Buyer's
purchase of the Property, including any financial information submitted in
connection with any bids submitted by Buyer to Seller, is true and correct in
all material respects.
16. HAZARDOUS MATERIAL.
16.1 DEFINITION OF HAZARDOUS MATERIAL. As used herein, the term
"Hazardous Material" means any hazardous or toxic substance, material, or waste
which is or becomes regulated by any local governmental authority, the State of
California or the United States Government. The term "Hazardous Material"
includes, without limitation, any material or substance which is (i) defined as
"hazardous waste," "extremely hazardous waste," or "restricted hazardous waste"
under Sections 25115, 25117 or 25122.7, or listed pursuant to Section 25140,
of the California Health and Safety Code, Division 20, Chapter 6.5 (Hazardous
Waste Control Law), (ii) defined as a "hazardous substance" under Section 25316
of the California Health and Safety Code, Division 20, Chapter 6.8
(Xxxxxxxxx-Xxxxxxx-Xxxxxx Hazardous Substance Account Act), (iii) defined as a
"hazardous material," "Hazardous substance," or "hazardous waste" under Section
25501 of the California Health and Safety Code, Division 20, Chapter 6.95
(Hazardous Materials Release Response Plans and Inventory), (iv) defined as a
"hazardous substance" under Section 25281 of the California Health and Safety
Code, Division 20, Chapter 6.7 (Underground Storage of Hazardous Substances),
(v) petroleum, (vi) asbestos, (vii) listed under Article 9 or defined as
"hazardous" or "extremely hazardous" pursuant to Article 11 of Title 22 of the
California Administrative Code, Division 4, Chapter 20, (viii) defined as a
"hazardous waste," "hazardous substance" or similar term under the Federal Water
Pollution Control Act (33 U.S.C. ss.1317), (ix) defined as a "hazardous waste"
pursuant to Section 1004 of the Federal Resource Conservation and Recovery Act,
42 U.S.C. ss.6901 et seq. (42 U.S.C. ss.6903), or (x) defined as a "hazardous
substance" pursuant to Section 101 of the Comprehensive Environmental Response,
Compensation and Liability Act, 42 U.S.C. ss.9601 et seq. (42 U.S.C. ss.9601).
16.2 PRESENCE OF HAZARDOUS MATERIAL. Buyer acknowledges that the
Property may or may not contain certain Hazardous Materials and that Seller
makes no representation or warranty to Buyer regarding the presence or absence
of any Hazardous Materials on or under the Property. It shall be Buyer's
responsibility under Sections 5.1(b) and 5.1(c) above to examine the Property
and to review such reports or other documents it deems necessary to satisfy
itself as to the presence or absence of any Hazardous Materials.
16.3 INDEMNIFICATION. If following Buyer's inspection of the
Property, the parties proceed to the Close of Escrow, Buyer shall indemnify,
defend and hold Seller harmless from any and all claims, demands (including
demands by any governmental agency), liabilities, costs, expenses, penalties,
damages, losses and liens, including without limitation reasonable attorneys'
fees, arising out of or with respect to (1) Hazardous Material on or under the
Property at the Close of Escrow or released on or under the Property subsequent
thereto, and (2) any clean-up of any and all Hazardous Material which might
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remain or subsequently be placed on or under the Property. The indemnity
provided for herein shall survive the Close of Escrow hereunder and shall not be
merged into the Deeds.
17. DISCLAIMER/AS IS SALE/RELEASE.
17.1 AS IS. AS A MATERIAL INDUCEMENT TO AND PART CONSIDERATION FOR
THE EXECUTION AND DELIVERY OF THIS AGREEMENT BY SELLER AND THE PERFORMANCE BY
SELLER OF ITS DUTIES AND OBLIGATIONS HEREUNDER, AND NOTWITHSTANDING ANY CONTRARY
TERM OR PROVISION OF THIS AGREEMENT OR OTHERWISE, BUYER DOES HEREBY EXPRESSLY
ACKNOWLEDGE, REPRESENT, WARRANT AND AGREE, TO AND WITH SELLER, THAT: (i) BUYER
IS PURCHASING THE PROPERTY IN ITS "AS IS" CONDITION, WITH ALL FAULTS, AS OF THE
CLOSE OF ESCROW WITH RESPECT TO ANY AND ALL KNOWN OR UNKNOWN FACTS,
CIRCUMSTANCES, CONDITIONS AND DEFECTS, SPECIFICALLY AND EXPRESSLY WITHOUT ANY
WARRANTIES, REPRESENTATIONS OR GUARANTIES, EITHER EXPRESS OR IMPLIED, ORAL OR
WRITTEN, OF ANY KIND, NATURE OR TYPE WHATSOEVER FROM OR ON BEHALF OF SELLER OR
ANYONE PURPORTING TO ACT ON BEHALF OF OR FOR OR AT THE DIRECTION OF SELLER,
INCLUDING, BUT IN NO WAY LIMITED TO, ANY WARRANTY OF CONDITION, MERCHANTABILITY,
HABITABILITY OR FITNESS FOR A PARTICULAR USE OR PURPOSE OR THE VALUE, ACCURACY
OF INFORMATION, MARKETABILITY, PROSPECTS FOR FUTURE DEVELOPMENT, USE OR
OCCUPANCY OR MATTERS AFFECTING SAME, AND BUYER HEREBY WAIVES ANY SUCH IMPLIED
WARRANTIES OR REPRESENTATIONS RELATING TO THE PROPERTY, THE LEASES OR ANY OTHER
MATTER AFFECTING THE PROPERTY, INCLUDING BUT NOT LIMITED TO, THE VALUE OF THE
PROPERTY OR FUTURE INCOME OR EXPENSES FOR THE PROPERTY; (ii) SELLER HAS NO
OBLIGATION TO REPAIR OR CORRECT ANY SUCH FACTS, CIRCUMSTANCES, CONDITIONS OR
DEFECTS OR COMPENSATE BUYER FOR SAME; (iii) BUYER HAS HERETOFORE UNDERTAKEN AND
WILL AS OF THE CLOSING DATE HAVE MADE ALL SUCH INQUIRIES AND INVESTIGATIONS
REGARDING THE PROPERTY AND ALL MATTERS RELATING THERETO AS BUYER DEEMS NECESSARY
OR APPROPRIATE UNDER THE CIRCUMSTANCES, AND THAT BASED UPON THE SAME, BUYER WILL
BE RELYING STRICTLY AND SOLELY UPON SUCH INQUIRIES AND THE ADVICE AND COUNSEL OF
ITS OWN AGENTS AND NOT ON ANY INFORMATION OR MATERIAL SUPPLIED BY OR ON BEHALF
OF SELLER, AND BUYER IS AND WILL BE FULLY SATISFIED THAT THE PURCHASE PRICE IS
FAIR AND ADEQUATE CONSIDERATION FOR THE PROPERTY; (iv) SELLER IS NOT MAKING AND
HAS NOT MADE AND HEREBY DISCLAIMS ANY AND ALL WARRANTIES OR REPRESENTATIONS WITH
RESPECT TO THE CONDITION OR USE OF OR OTHERWISE RELATING TO ALL OR ANY PART OF
THE PROPERTY; AND (v) BY REASON OF ALL OF THE FOREGOING, BUYER SHALL ASSUME THE
FULL RISK OF ANY LOSS OR DAMAGE OCCASIONED BY ANY FACT, CIRCUMSTANCE, CONDITION
OR DEFECT PERTAINING TO THE CONDITION OR USE OF ALL OR ANY PART OF THE PROPERTY
WHETHER KNOWN OR UNKNOWN. SELLER HEREBY EXPRESSLY DISCLAIMS ANY AND ALL
RESPONSIBILITY FOR ANY AND ALL LOSSES, CLAIMS, EXPENSES, DAMAGES, SUITS,
ACTIONS, JUDGMENTS, COSTS, OBLIGATIONS AND LIABILITIES OF ANY KIND, WHETHER
FORESEEABLE OR UNFORESEEABLE, CONSEQUENTIAL OR OTHERWISE, WITH RESPECT TO OR IN
ANY WAY RELATING TO OR INDIRECTLY OR DIRECTLY ARISING OUT OF THE PROPERTY, OR
ANY PART THEREOF OR ANY MATTER RELATING THERETO. THE PURCHASE PRICE AND OTHER
TERMS AND CONDITIONS CONTAINED IN THIS AGREEMENT ARE THE RESULT OF ARM'S-LENGTH
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NEGOTIATIONS BETWEEN PARTIES FAMILIAR WITH TRANSACTIONS OF THIS KIND, AND THE
PURCHASE PRICE AND OTHER TERMS AND CONDITIONS CONTAINED IN THIS AGREEMENT TAKE
INTO ACCOUNT THE FACT THAT BUYER IS NOT ENTITLED TO RELY ON ANY INFORMATION
PROVIDED BY SELLER, ANY OF ITS AGENTS, OR ANY OTHER PERSON ACTING FOR OR ON
BEHALF OF SELLER. ALL INFORMATION, WHETHER WRITTEN OR ORAL, PREVIOUSLY, NOW, OR
HEREAFTER MADE AVAILABLE TO BUYER BY SELLER, ITS AGENTS, OR ANY OTHER PERSON
ACTING FOR OR ON BEHALF OF SELLER, WHETHER IN THE FORM OF APPRAISALS, OFFERING
MATERIALS (INCLUDING THE INVESTMENT PROPERTY OFFERINGS DATED JUNE 1997 AND JULY
1997, RESPECTIVELY, PREPARED BY OR DISTRIBUTED THROUGH X.X. XXXXX REALTY
ADVISORS AND PM REALTY GROUP), BROCHURES, MAPS, SURVEYS, SOIL REPORTS,
ENGINEERING STUDIES, ENVIRONMENTAL STUDIES, INSPECTION REPORTS, PLANS AND
SPECIFICATIONS, AND ALL OTHER REVIEW MATTERS HAVE BEEN OR WILL BE FURNISHED BY
SELLER TO BUYER SOLELY AS A COURTESY, AND NEITHER SELLER NOR ITS AGENTS HAS
VERIFIED THE ACCURACY OF SUCH INFORMATION OR THE QUALIFICATIONS OF THE PERSONS
PREPARING SUCH INFORMATION, AND BUYER IS NOT RELYING ON, AND SHALL NOT BE
ENTITLED TO RELY ON, SUCH INFORMATION IN ENTERING INTO THIS AGREEMENT AND
COMPLETING ITS PURCHASE OF THE PROPERTY PURSUANT TO THIS AGREEMENT.
17.2 BUYER'S INDEPENDENT DUE DILIGENCE. BY ENTERING INTO THIS
AGREEMENT, BUYER HAS AGREED TO PERFORM (AND BUYER REPRESENTS AND WARRANTS TO
SELLER THAT BUYER IS CAPABLE OF PERFORMING) A SOPHISTICATED, EXPERT, THOROUGH,
AND INDEPENDENT INVESTIGATION, ANALYSIS AND EVALUATION OF THE PROPERTY AND ALL
OTHER ASPECTS OF THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT, AND BUYER
AGREES THAT BUYER SHALL BE CHARGED WITH KNOWLEDGE OF ALL INFORMATION WHICH IS
ACQUIRED BY BUYER AS A RESULT OF SUCH AN INVESTIGATION, ANALYSIS, AND EVALUATION
OR WHICH WOULD OR SHOULD HAVE BEEN ACQUIRED BY BUYER AS A RESULT OF SUCH AN
INVESTIGATION, ANALYSIS, AND EVALUATION. AS A MATERIAL INDUCEMENT TO AND PART
CONSIDERATION FOR THE EXECUTION AND DELIVERY OF THIS AGREEMENT BY SELLER AND THE
PERFORMANCE BY SELLER OF ITS DUTIES AND OBLIGATIONS HEREUNDER, NOTWITHSTANDING
ANY CONTRARY TERM OR PROVISION OF THIS AGREEMENT OR OTHERWISE, AND WITHOUT
LIMITING THE GENERALITY OF THIS SECTION OR ANY OTHER PROVISION OF THIS
AGREEMENT, BUYER WARRANTS AND REPRESENTS TO SELLER AND AGREES AS FOLLOWS:
17.2.1 PHYSICAL INSPECTION. PRIOR TO THE CONTINGENCY DATE, BUYER WILL
HAVE CONDUCTED ITS OWN EXPERT, THOROUGH, AND INDEPENDENT INSPECTION,
INVESTIGATION, ANALYSIS AND EVALUATION OF THE PROPERTY AND WILL HAVE DETERMINED
SOLELY IN RELIANCE THEREON THAT THE PHYSICAL CONDITION OF THE PROPERTY IS
ACCEPTABLE TO BUYER, INCLUDING (1) ALL STRUCTURAL ELEMENTS OF THE IMPROVEMENTS
AND ALL MECHANICAL, ELECTRICAL, HEATING, AIR CONDITIONING, VENTILATION, FIRE
SAFETY, SECURITY, PLUMBING AND OTHER SYSTEMS IN THE IMPROVEMENTS OR ON OR UNDER
THE LAND; (2) ALL SOIL AND GEOLOGICAL CONDITIONS OF THE LAND; AND (3) THE
PRESENCE OR ABSENCE OF ANY HAZARDOUS MATERIALS IN, ON, UNDER OR AROUND ANY OR
ALL OF THE PROPERTIES. IF THE PHYSICAL CONDITION OF THE PROPERTY IS NOT
ACCEPTABLE TO BUYER, BUYER'S SOLE AND
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EXCLUSIVE REMEDY SHALL BE TO TERMINATE THIS AGREEMENT IN ACCORDANCE WITH SECTION
5.1(c) ABOVE.
17.2.2 REVIEW OF RECORDS. PRIOR TO THE CONTINGENCY DATE, BUYER
WILL HAVE HAD ACCESS TO AND WILL HAVE CONDUCTED ITS OWN EXPERT, THOROUGH, AND
INDEPENDENT INSPECTION, INVESTIGATION, ANALYSIS AND EVALUATION OF ALL
INSTRUMENTS, RECORDS AND DOCUMENTS WHICH BUYER HAS DETERMINED TO BE APPROPRIATE
OR ADVISABLE TO REVIEW IN CONNECTION WITH BUYER'S PURCHASE OF THE PROPERTY AND
THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT, INCLUDING THOSE RELATING TO ALL
ZONING REGULATIONS AND OTHER GOVERNMENTAL REQUIREMENTS, SITE AND PHYSICAL
CONDITIONS, TITLE MATTERS, AND ALL OTHER MATTERS AFFECTING THE USE, OCCUPANCY,
VALUE, AND CONDITION OF THE PROPERTY, AND BUYER WILL HAVE DETERMINED SOLELY IN
RELIANCE THEREON THAT THE INFORMATION AND DATA CONTAINED THEREIN OR EVIDENCED
THEREBY IS SATISFACTORY TO BUYER. BUYER SPECIFICALLY ACKNOWLEDGES THAT BUYER IS
NOT RELYING ON SELLER TO INDICATE THE RELATIVE IMPORTANCE OR MATERIALITY OF ANY
OF THE INSTRUMENTS, RECORDS, DOCUMENTS AND OTHER INFORMATION MADE AVAILABLE TO
BUYER FOR REVIEW AND BUYER SHALL MAKE ITS OWN DETERMINATION AS TO THE LEVEL OF
SCRUTINY IT APPLIES TO SUCH INSTRUMENTS, RECORDS AND DOCUMENTS MADE AVAILABLE TO
BUYER. WITHOUT LIMITING THE GENERALITY OF THE IMMEDIATELY PRECEDING SENTENCE, IF
AND TO THE EXTENT THAT ANY REVIEW MATTERS MADE AVAILABLE TO BUYER INCLUDE A
DISCLOSURE OF ANY POSSIBLE DEFECTS, DEFICIENCIES, OR SIMILAR MATTERS RELATING TO
THE PROPERTY, SUCH DISCLOSURE DOES NOT CONSTITUTE A COMPLETE STATEMENT OF ALL
SUCH MATTERS RELATING TO THE PROPERTY, AND BUYER ASSUMES FULL AND COMPLETE
RESPONSIBILITY FOR DETERMINING THE PRESENCE OR ABSENCE, AND NATURE AND EXTENT
OF, ANY AND ALL DEFECTS, DEFICIENCIES, OR SIMILAR MATTERS RELATING TO THE
PROPERTY AS PART OF BUYER'S INSPECTIONS AND REVIEWS UNDER SECTION 5.1 ABOVE. IF
BUYER IS NOT SATISFIED WITH ITS REVIEW OF ANY OF THE REVIEW MATTERS OR TITLE
MATTERS RELATING TO THE PROPERTY, BUYER'S SOLE AND EXCLUSIVE REMEDY SHALL BE TO
TERMINATE THIS AGREEMENT IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.1(a) OR
5.1(b) ABOVE, AS APPLICABLE.
17.2.3 PURCHASE FOR BUYER'S ACCOUNT. BUYER IS PURCHASING THE
PROPERTY FOR ITS OWN ACCOUNT; PROVIDED, HOWEVER, THAT BUYER SHALL NOT BE DEEMED
TO BE IN BREACH OF THIS SECTION IF AN AUTHORIZED INVESTMENT ADVISOR OR
REPRESENTATIVE OF BUYER HAS ACTED AS AGENT FOR AND ON BEHALF OF BUYER IN THIS
TRANSACTION.
17.3 RELEASE. As a material inducement to and part consideration for
the execution and delivery of this Agreement by Seller and the performance by
Seller of its duties and obligations under this Agreement, and effective as of
the date set forth in Section 17.5 below, Buyer, on behalf of Buyer and Buyer's
partners, officers, directors, predecessors, successors and assigns, hereby
expressly, fully and forever releases and discharges (which release and
discharge shall be continuing and shall survive the Closing and the transfer of
the Property and/or any termination of this Agreement) Seller, its members,
managers, employees, officers, consultants, attorneys, and agents, from any and
all losses, expenses, claims, costs, damages, rights of subrogation, debts,
attorneys' fees,
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actions, suits, judgments, awards, obligations and/or liabilities of any kind,
whether foreseeable or unforeseeable, known or unknown, or suspected or
unsuspected, with respect to or in any way relating to or indirectly or directly
arising out of (1) the whole or any part of the Property, Leases, and/or
Contracts or any fact, event, circumstance, omission, occurrence of any kind or
nature relating thereto, based on any theory of law, equity or tort now existing
or coming into existence in the future, (2) any Hazardous Material on or under
the Property at the Close of Escrow or released on or under the Property
subsequent thereto, and (3) any required clean-up of any and all Hazardous
Material which might remain or subsequently be placed on or under the Property,
including without limitation any personal injuries suffered by any person or
persons.
17.4 WAIVER. Buyer and its successors, assigns, heirs, devisees and
executors, agrees, represents and warrants that the matters released in Section
17.3 hereof are not limited to matters which are known or disclosed, and hereby
waives any and all rights and benefits which it now has, or in the future may
have, conferred upon it by virtue of the provisions of Section 1542 of the Civil
Code of the State of California which provides as follows:
"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR
DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF
EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY
AFFECTED HIS SETTLEMENT WITH THE DEBTOR."
Buyer, on its behalf and on behalf of its officers, directors, partners and
their respective predecessors, successors and assigns, hereby knowingly and
voluntarily waives and relinquishes all rights and benefits afforded by Section
1542 of the California Civil Code as set forth hereinabove, or any comparable,
equivalent or similar statutes and principles of common law of all the states of
the United States, and of the United States, if applicable, and of any foreign
country, if applicable. Buyer, on its behalf and on behalf of its officers,
directors, partners and their respective predecessors, successors and assigns,
understands that the facts in respect of which the releases in this Section 17
are given may hereafter turn out to be other than or different from the facts in
that connection now known or believed by Buyer to be true or that Buyer may
hereafter discover facts or documents in addition to or different from those
which Buyer now knows or believes to be true or exist with respect to any matter
covered by this release, and Buyer, on its behalf and on behalf of its officers,
directors, partners and their respective predecessors, successors and assigns,
accepts and assumes the risk of the facts turning out to be different and no
party or person being released by this release shall have any duty to disclose
or provide any such facts or documents (whether material or immaterial, known or
unknown, or suspected or unsuspected), and that this release shall be and remain
in all respects effective and not subject to termination or rescission by virtue
of any such difference in facts, even if any facts were not disclosed.
17.5 CERTAIN OBLIGATIONS NOT RELEASED. Notwithstanding anything to
the contrary contained in Sections 17.3 or 17.4 above, the release contained in
this Section 17:
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(i) shall become effectively only on the Close of Escrow; and
(ii) shall not be deemed to release the Seller from or otherwise
affect its representations, warranties, and obligations under this Agreement or
any of the documents executed by Seller in connection with this Agreement.
The provisions of this Section 17, including the release set forth
herein, shall survive the Closing Date and the transfer of the Property from
Seller to Buyer and any termination of the Agreement and shall not be merged
into the grant deed.
18. LEGAL FEES. In the event of the bringing of any action or suit by
a party hereto against another party hereunder by reason of any breach of any of
the obligations, covenants or agreements or any inaccuracies in any of the
representations and warranties on the part of the other party arising out of
this Agreement, then in that event, the prevailing party in such action shall be
entitled to have and recover from the other party all costs and expenses of suit
including actual attorneys' fees as directed by the court.
19. NOTICES. All notices or other communications required or permitted
hereunder shall be in writing and shall be personally delivered or sent by
registered or certified mail, postage prepaid, return receipt requested,
delivered or sent by telex, telecopy, cable or via a reliable overnight courier,
and shall be deemed received upon the earliest of (i) if personally delivered or
via overnight courier, the date of delivery to the person to receive such
notice; (ii) if mailed, upon the date of receipt as disclosed on the return
receipt; or (iii) if given by telecopy then on the day sent unless after normal
business hours in which event it shall be the next business day; provided,
however, that any notice, request, demand, direction or other communication sent
by telecopy must be confirmed within twenty-four (24) hours by registered or
certified letter mailed or delivered in accordance with the foregoing:
To Buyer: _____________________________________
_____________________________________
Attentionn: _______________________
Phone: (___)__________________
Telecopy: (___)__________________
With a copy to: _____________________________________
_____________________________________
Attentionn: _______________________
Phone: (___)__________________
Telecopy: (___)__________________
To Seller: XXX Properties LLC
c/o R & B Realty Group
0000 Xxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xx. Xxxxx Xxxxxxxx
Phone: 310/ 000-0000
Telecopy: 310/ 479-1451
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With a Copy to: XXX Properties LLC
c/o R & B Realty Group
0000 Xxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xx. Xxxxx X. Xxxx
Phone: 310/ 000-0000
Telecopy: 310/ 479-1451
With a copy to: Xxxxxxx X. Small, Esq.
Xxxxxxxxx Xxxxxxxx & Pines LLP
0000 Xxxxxxx Xxxx Xxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Phone: 310/ 000-0000
Telecopy: 310/ 552-6077
With a copy to: Xxxxxx Xxxxxx, Esq.
Irell & Xxxxxxx LLP
0000 Xxxxxx xx xxx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Escrow Officer:___________________
Phone: 310/ 000-0000
Telecopy: 310/ 203-7199
To Escrow Holder: Chicago Title Insurance Company
Escrow Department
000 Xxxxx Xxxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Escrow Officer:___________________
Phone: 213/ 000-0000
Telecopy: 213/ 488-4384
Notice of change of address shall be given by written notice in the manner
detailed in this Section. Refusal to accept or the inability to deliver because
of changed address of which no notice was given shall be deemed to constitute
receipt of the notice, demand, request or communication sent.
20. Brokers. Except for (a) the commission payable upon the Close of
Escrow to X.X. Xxxxx Realty Advisors ("Seller's Broker"), as Seller's broker,
pursuant to a separate written listing agreement between Seller and Seller's
Broker, which listing agreement may authorize Seller's Broker to utilize the
services of PM Realty Group; and (b) the finder's fee or brokerage fee payable
to R & B Realty Group ("R & B Realty") pursuant to a separate written agreement
between Seller and R & B Realty, each party warrants and represents to the other
that no broker, salesman, or finder has been engaged by it in connection with
the transaction contemplated by this Agreement. Buyer shall indemnify, hold
harmless and defend Seller against each and every claim for any such fees,
commissions or other amounts, if such claims are based upon any statement or
representation or agreement of Buyer or if such claimant is claiming by, through
or under Buyer. Seller shall indemnify, hold harmless and defend Buyer against
each and every claim for any such fees, commissions or other amounts if such
claims are based upon any statement or representations or agreement of Seller or
if such claimant is claiming by, through or under
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Seller. The foregoing indemnities shall survive the Closing Date or any
termination of this Agreement.
21. NO SURVIVAL. The representations and warranties of both Buyer and
Seller set forth in this Agreement shall, unless expressly stated otherwise
herein to the contrary, not survive the Closing Date; provided, however, all of
the representations and warranties of the Seller and Buyer made in Section 15
are and will be continuous and continuing and all of the same shall remain true
and correct in all material respects through the Closing.
22. TAX-DEFERRED EXCHANGE. Buyer acknowledges and agrees that Seller
may transfer the Property to Buyer as part of a tax-deferred exchange by Seller
pursuant to Section 1031 of the Internal Revenue Code of 1986, as amended (the
"Code"), and that Seller has the right to restructure all or part of the
transaction contemplated by this Agreement as provided in Section 1031 of the
Code as a concurrent or delayed (non-simultaneous) tax deferred exchange for the
benefit of Seller. Buyer shall cooperate with Seller if Seller elects to convey
the Property in connection with a tax-deferred exchange within the meaning of
Section 1031 of the Code and, if requested by Seller, to accommodate Seller in
any such exchange, provided that Seller's election to effect a tax-deferred
exchange shall not create any additional conditions to the Close of Escrow or
extend the Closing Date. Seller, in electing to structure the sale as an
exchange, shall have the right to substitute, assign, or delegate its rights and
duties to one or more entities or persons who will be Seller's accommodator as
seller in the Escrow in Seller's place and stead. Any such exchange shall be
accomplished by supplemental instructions reasonably acceptable to both parties
(the "Exchange Instructions"), including any exchange documents and instructions
with an exchange accommodator. Buyer shall execute and deliver to Seller or
Escrow Holder any and all Exchange Instructions provided to Buyer by Seller
within three (3) Business Days after Buyer's receipt of such Exchange
Instructions. Each party shall bear its own costs and expenses (including
attorneys' fees and costs) incurred in connection with the preparation and
review of the Exchange Instructions.
23. NO OFFER. Submission of this Agreement for examination or
signature by Buyer is not effective as an agreement to sell the Property or
otherwise until execution by and delivery to both Buyer and Seller of an
original of this Agreement.
24. TIME OF ESSENCE. Notwithstanding anything to the contrary
contained in the Standard Provisions, time is of the essence of each and every
term, condition, obligation and provision hereof.
25. COUNTERPARTS. This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original, but all of which,
together, shall constitute one and the same instrument.
26. CAPTIONS. Any captions to, or headings of, the paragraphs or
subparagraphs of this Agreement are solely for the convenience of the parties
hereto, are not a part of this Agreement, and shall not be used for the
interpretation or determination of the validity of this Agreement or any
provision hereof.
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31
27. NO OBLIGATIONS TO THIRD PARTIES. The execution and delivery of
this Agreement shall not be deemed to confer any rights upon, nor obligate any
of the parties thereto, to any person or entity other than the parties hereto.
28. EXHIBITS. The Exhibits and Schedules attached hereto are hereby
incorporated herein by this reference.
29. AMENDMENT TO THIS AGREEMENT. The terms of this Agreement may not
be modified or amended except by an instrument in writing executed by each of
the parties hereto.
30. WAIVER. The waiver or failure to enforce any provision of this
Agreement shall not operate as a waiver of any future breach of any such
provision or any other provision hereof. Except as otherwise expressly provided
in this Agreement (including matters which may be deemed approved by Buyer under
Section 5 above), no waiver by Buyer or Seller of any of the terms or conditions
of this Agreement or any of their respective rights hereunder shall be effective
unless such waiver is in writing and signed by the party charged with the
waiver.
31. APPLICABLE LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of California.
32. ENTIRE AGREEMENT. This Agreement and attached Schedules and
Exhibits together supersede any prior agreement, negotiations and
communications, oral or written, and contains the entire agreement between Buyer
and Seller as to the subject matter hereof. No subsequent agreement,
representation, or promise made by either party hereto, or by or to an employee,
officer, agent or representative of either party shall be of any effect unless
it is in writing and executed by the party to be bound thereby.
33. SUCCESSORS AND ASSIGNS. This Agreement and all of the terms,
conditions and provisions hereof shall inure to the benefit of and be binding
upon the respective permitted successors and assigns of the parties hereto.
Without Seller's prior written consent, which consent may be withheld by Seller
in its discretion, Buyer shall not (a) assign any of Buyer's rights or delegate
any of Buyer's duties under this Agreement; or (b) enter into any agreement or
escrow for the resale of the Property. If Buyer attempts or purports to enter
into any assignment, agreement or escrow in violation of this Section, Seller,
at its option, shall have the right to immediately terminate this Agreement.
34. CERTAIN REMEDIES.
34.1 LIQUIDATED DAMAGES. NOTWITHSTANDING ANY OTHER PROVISION
CONTAINED IN THIS AGREEMENT, IF THE SALE OF THE PROPERTY IS NOT CONSUMMATED BY
REASON OF ANY DEFAULT BY BUYER UNDER THIS AGREEMENT, THEN SELLER SHALL BE
ENTITLED TO RETAIN BUYER'S INITIAL DEPOSIT IN THE AMOUNT OF $625,000 AND BUYER'S
ADDITIONAL DEPOSIT IN THE AMOUNT OF $1,250,000 AS SELLER'S LIQUIDATED DAMAGES.
BUYER AND SELLER AGREE THAT SELLER'S DAMAGES WHICH WOULD RESULT FROM BUYER'S
FAILURE TO ACQUIRE THE PROPERTY FOR ANY REASON ARE IMPRACTICABLE AND EXTREMELY
DIFFICULT TO ASCERTAIN, AND THAT UNDER THE CIRCUMSTANCES EXISTING AS OF THE DATE
OF THIS AGREEMENT, THE LIQUIDATED DAMAGES IN THE
27
32
AMOUNT OF THE DEPOSIT REPRESENTS A REASONABLE ESTIMATE OF SUCH DAMAGES. THE
PAYMENT OF SUCH AMOUNT AS LIQUIDATED DAMAGES FOR THE BREACH OF BUYER'S
OBLIGATION TO PURCHASE THE PROPERTY UNDER THIS AGREEMENT IS NOT INTENDED AS A
FORFEITURE OR PENALTY WITHIN THE MEANING OF CALIFORNIA CIVIL CODE SECTIONS 3275
OR 3369, BUT IS INTENDED TO CONSTITUTE LIQUIDATED DAMAGES TO SELLER PURSUANT TO
CALIFORNIA CIVIL CODE SECTIONS 1671, 1676 AND 1677. THE PARTIES HAVE SET FORTH
THEIR INITIALS BELOW TO INDICATE THEIR AGREEMENT WITH THE LIQUIDATED DAMAGES
PROVISION CONTAINED IN THIS SECTION.
SELLER'S INITIALS BUYER'S INITIALS
[SIG]
------------------------ ------------------------
34.2 LIMITATION ON LIABILITY. BUYER AGREES THAT, IN THE EVENT OF
ANY DEFAULT BY SELLER HEREUNDER, BUYER'S SOLE AND EXCLUSIVE REMEDY SHALL BE AN
ACTION AT LAW FOR DAMAGES (PROVIDED, HOWEVER, BUYER SHALL NOT BE ENTITLED TO,
AND BUYER HEREBY WAIVES, ANY AND ALL PUNITIVE, INCIDENTAL, SPECULATIVE AND
CONSEQUENTIAL DAMAGES AND DAMAGES FOR BUYER'S LOSS OF ITS BARGAIN). ACCORDINGLY,
BUYER AGREES THAT, IN THE EVENT OF ANY SUCH DEFAULT BY SELLER, BUYER HEREBY
UNCONDITIONALLY AND IRREVOCABLY WAIVES AND SHALL HAVE NO RIGHT TO (A) SPECIFIC
PERFORMANCE OR ANY OTHER EQUITABLE REMEDY; (B) RECORD OR FILE A LIS PENDENS OR
ANY OTHER MATTER AFFECTING TITLE TO THE PROPERTY; OR (C) CLAIM A VENDEE'S LIEN
OR ANY OTHER LIEN UPON THE PROPERTY. THE OBLIGATIONS OF SELLER UNDER THIS
AGREEMENT DO NOT CONSTITUTE PERSONAL OBLIGATIONS OF THE MEMBER'S, PARTNERS,
DIRECTORS, OFFICERS OR SHAREHOLDERS OF SELLER, AND BUYER SHALL NOT SEEK RECOURSE
AGAINST THE MEMBERS, PARTNERS, DIRECTORS, OFFICERS, OR SHAREHOLDERS OF SELLER OR
ANY OF THEIR PERSONAL ASSETS FOR SATISFACTION OF ANY LIABILITY IN RESPECT TO
THIS AGREEMENT. THE PROVISIONS OF THIS SECTION ARE A MATERIAL INDUCEMENT TO
SELLER TO EXECUTE THIS AGREEMENT, WITHOUT WHICH SELLER WOULD NOT HAVE BEEN
WILLING TO EXECUTE THIS AGREEMENT. BUYER AND SELLER SHALL INITIAL BELOW THIS
SECTION INDICATING THEIR SPECIFIC AGREEMENT TO THIS PROVISION.
SELLER'S INITIALS BUYER'S INITIALS
[SIG]
------------------------ ------------------------
35. NO THIRD PARTY BENEFICIARIES. Nothing contained in this Agreement,
express or implied, is intended to confer upon any person other than the parties
hereto and their permitted successors and assigns any rights or remedies under
or by reason of this Agreement.
36. INTERPRETATION; COMPUTATION OF PERIODS. All periods of time
referred to in this Agreement shall include all Saturdays, Sundays, and
California or national holidays, unless the period of time specifies Business
Days, provided that if the date or last date to
28
33
perform any act or give a notice with respect to this Agreement shall fall on a
Saturday, Sunday or a California or national holiday, such act or notice may be
timely performed or given on the next succeeding day which is not a Saturday,
Sunday or a California or national holiday. Whenever the context of this
Agreement reasonably requires, all words used in the singular shall be deemed to
have been used in the plural, and the neuter gender shall be deemed to include
the masculine and feminine gender, and vice versa. This Agreement (including the
Exhibits attached hereto) has been drafted through a joint effort of the parties
and their respective counsel and, therefore, shall not be construed in favor of
or against any of the parties as the person who prepared this Agreement and such
Exhibits. For purposes of this Agreement, (a) the term "including" shall be
deemed to mean "including without limitation;" (b) the term "Business Day" means
any day other than a Saturday, a Sunday, or a federal or California State
holiday; (c) the term "Pacific Time" means Pacific Standard Time or Pacific
Daylight Savings Time, whichever is then applicable in Los Angeles, California
on the date in question; (d) the term "discretion" means sole and absolute
discretion; and (e) the phrase "to Seller's actual knowledge," as used in this
Agreement, shall mean the present actual knowledge, without duty of inquiry or
investigation, of the managing members of Seller.
37. CONFIDENTIALITY. Seller and Buyer each shall keep the terms and
conditions of this Agreement confidential, except for (a) such disclosures to
third persons as may be reasonably necessary in order to consummate the
transactions contemplated by this Agreement; (b) privileged communications by
the respective parties, including communications with the parties' respective
counsel and advisors; (c) such disclosures as may be necessary or required by
those governmental agencies, authorities, or examiners having jurisdiction over
Seller and Buyer, respectively; and (d) such disclosures as may be required by
subpoena or any other similar court order or discovery request in any civil or
criminal proceeding or investigation. With respect to any disclosures otherwise
permitted under this Section 37(a) and (b), prior to any such disclosures or
communications, the party making such disclosure or communication shall (1)
inform each and every such receiving party that such information is confidential
and is subject to a prohibition on further dissemination or circulation by any
means, and (2) shall obtain such receiving party's agreement to maintain the
confidentiality of this Agreement in accordance with the terms herein. This
Section shall survive the Close of Escrow and any termination of this Agreement.
38. AGENCY RELATIONSHIP. Buyer acknowledges and agrees that (a) R & 8
Realty is affiliated, directly or indirectly, with Seller and one or more of
Seller's members and is also acting as a broker or finder with respect to
Seller; and (b) R & B Realty is only acting for or representing Seller in the
transactions contemplated by this Agreement, and has no duty of any kind to
Buyer.
39. WAIVER OF TRIAL BY JURY. SELLER AND BUYER KNOWINGLY, VOLUNTARILY
AND INTENTIONALLY WAIVE (TO THE EXTENT PERMITTED BY APPLICABLE LAW) ANY RIGHT
THEY MAY HAVE TO A TRIAL BY JURY OF ANY DISPUTE ARISING UNDER OR RELATING TO
THIS AGREEMENT, AND THE PARTIES AGREE THAT ANY SUCH DISPUTE SHALL BE TRIED
BEFORE A JUDGE SITTING WITHOUT A JURY.
40. REVIEW WITH INDEPENDENT COUNSEL. EACH OF THE PARTIES ACKNOWLEDGES
AND AGREES THAT (A) IT HAS CAREFULLY READ AND UNDERSTANDS ALL OF THE TERMS OF
THIS AGREEMENT; (B) IT HAS ENTERED INTO
29
34
THIS AGREEMENT FREELY AND VOLUNTARILY, AFTER HAVING CONSULTED WITH ITS OWN
INDEPENDENT LEGAL COUNSEL; (C) EACH OF THE WAIVERS AND RELEASES CONTAINED IN
THIS AGREEMENT IS REASONABLE, NOT CONTRARY TO PUBLIC POLICY OR LAW, AND HAS BEEN
INTENTIONALLY, KNOWINGLY, AND VOLUNTARILY AGREED TO BY THE PARTIES; AND (D) EACH
OF THE WAIVERS AND RELEASES CONTAINED IN THIS AGREEMENT HAS BEEN AGREED TO BY
SUCH PARTY WITH FULL KNOWLEDGE OF ITS SIGNIFICANCE AND CONSEQUENCES.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
"Buyer" PACIFIC GULF PROPERTIES
By: [SIG]
------------------------------------
Its: President - CEO
-----------------------------------
By: [SIG]
------------------------------------
Its: Senior Vice President
-----------------------------------
"Seller" XXX PROPERTIES LLC, a California
limited liability company
By:
------------------------------------
Its:
-----------------------------------
By:
------------------------------------
Its:
-----------------------------------
30
35
ACKNOWLEDGMENT OF RECEIPT AND ACCEPTANCE BY ESCROW HOLDER
---------------------------------------------------------
The undersigned Escrow Holder hereby agrees to act as Escrow Holder pursuant to
the terms and conditions set forth in this Agreement.
Dated: September __, 1997.
CHICAGO TITLE INSURANCE COMPANY
By:
------------------------------------
Its:
-----------------------------------
31
36
AGREEMENT OF PURCHASE AND SALE
------------------------------
AND JOINT ESCROW INSTRUCTIONS
-----------------------------
SCHEDULE OF EXHIBITS
--------------------
LEGAL DESCRIPTION ANAHEIM PROPERTY Exhibit A-1
DESCRIPTION ANAHEIM PERSONAL PROPERTY Exhibit A-2
LEGAL DESCRIPTION SUNNYVALE PROPERTY Exhibit B-1
DESCRIPTION SUNNYVALE PERSONAL PROPERTY Exhibit B-2
LEGAL DESCRIPTION SAN XXXXX PROPERTY Exhibit C-1
DESCRIPTION SAN XXXXX PERSONAL PROPERTY Exhibit C-2
LEGAL DESCRIPTION SACRAMENTO PROPERTY Exhibit D-1
DESCRIPTION SACRAMENTO PERSONAL PROPERTY Exhibit D-2
STANDARD ESCROW PROVISIONS Exhibit 3.1
FORM OF GRANT DEED Exhibit 3.2
ASSIGNMENT OF LEASES Exhibit 6(b)
ASSIGNMENT OF CONTRACTS Exhibit 6(d)
XXXX OF SALE AND ASSIGNMENT OF PERSONAL PROPERTY Exhibit 6(e)
TRANSFEROR'S CERTIFICATE OF NON-FOREIGN STATUS Exhibit 6(f)
TENANT ESTOPPEL CERTIFICATE Exhibit 8.1.3
37
AGREEMENT OF PURCHASE AND SALE
------------------------------
AND JOINT ESCROW INSTRUCTIONS
-----------------------------
EXHIBIT "A-1"
-------------
LEGAL DESCRIPTION OF ANAHEIM PROPERTY
-------------------------------------
All of that certain real property in the City of Anaheim, County of Orange,
State of California, described as follows:
PARCEL 1:
The West 10.00 acres of the South half of the Southwest quarter of the Northwest
quarter of Section 24, Township 4 South, Range 10 West, in the Rancho San Xxxx
Cajon de Santa Xxx, City of Anaheim, County of Orange, State of California, as
per map recorded in Book 51, Page 10 of Miscellaneous Maps, in the Office of the
County Recorder of said County.
Except the North 320.00 feet thereof.
PARCEL 2:
The North 320.00 feet of the West 10.00 acres of the South half of the Southwest
quarter of the Northwest quarter of Section 24, Township 4 South, Range 10 West,
in the Rancho San Xxxx Cajon de Santa Xxx, City of Anaheim, County of Orange,
State of California, as per map recorded in Book 51, Page 10 of Miscellaneous
Maps, in the Office of the County Recorder of said County.
38
AGREEMENT OF PURCHASE AND SALE
------------------------------
AND JOINT ESCROW INSTRUCTIONS
-----------------------------
EXHIBIT "A-2"
-------------
DESCRIPTION OF ANAHEIM PERSONAL PROPERTY
----------------------------------------
Description to be provided pursuant to Section 5.1(b) as part of "Review
Matters."
39
AGREEMENT OF PURCHASE AND SALE
------------------------------
AND JOINT ESCROW INSTRUCTIONS
-----------------------------
EXHIBIT "B-1"
-------------
LEGAL DESCRIPTION OF SUNNYVALE PROPERTY
---------------------------------------
All of that certain real property in the City of Sunnyvale, County of Santa
Xxxxx, State of California, described as follows:
All that certain real property in Section 29, Township 6 South, Range 1 West,
Mount Diablo Base and Meridian, in the City of Sunnyvale, County of Santa Xxxxx,
State of California; being a portion of that certain 7.642 acre parcel shown on
the Record of Survey Map recorded in Book 263 of Maps at Page 30, Santa Xxxxx
County Records, said portion being more particularly described as follows:
Beginning at a Northwesterly corner of said 7.642 acre parcel, from which corner
the intersection of the center line of Xxxxx Court and the "Q" line in Xxxxxxxx
Expressway, as shown on said Map, bears North 88 deg. 18 degrees 10" East 767.67
feet; thence from said point of beginning, along a boundary of said Parcel,
South 1 degree 41' 50" East, 20.00 feet to the true point of commencement, along
the boundaries of said 7.642 acre parcel, on the following courses: Westerly,
along a curve with a radius of 55.00 feet, deflecting to the left from a tangent
bearing South 88 deg. 18 degrees 10: West, through a central angle of 59 deg.
50' 23" an arc distance of 57.44 feet to a point of compound curve; thence from
said point of compound curve, Southerly along a curve with a radius of 110.00
feet, deflecting to the left from a tangent bearing 28 deg. 27 degrees 47" West,
through a central angle of 59 deg. 37', 07", an arc distance of 114.46 feet to a
point of tangency on the Northeasterly boundary of East Xxxxx Avenue, as shown
on said Map; thence along said Northeasterly boundary South 31 deg. 09' 20" East
320.51 feet; thence Southeasterly along a tangent curve to the left, having a
radius of 307.00 feet through a central angle of 66 deg. 26 degrees 17", an arc
distance of 355.99 feet to the point of tangency; thence North 82 deg. 24' 23"
East 35.38 feet 190.00 feet to the Westerly line of Xxxxxxxx Expressway as shown
on said Map; thence along said line of Xxxxxxxx Expressway, North 0 deg. 20' 51"
West 218.05 feet; thence North 0 deg. 02'00" East 108.16 feet; thence along a
tangent curve to the left, having a radius of 60.00 feet, through a central
angle of 47 deg. 32' 37", an arc distance of 49.79 feet to a point of CUSP with
a circular curve which has a radius of 61.00 feet; thence leaving said
boundaries of said 7.642 acre parcel, Westerly along last said curve, deflecting
to the right from a tangent bearing South 47 deg. 12 degrees 51" West, through a
central angle of 98 deg. 53 degrees 39: an arc length of 105.29 feet to a point
of reverse curvature; thence Westerly along a curve which has A radius of 61.00
feet, deflecting to the left, from a tangent bearing North 33 degrees 53' 30"
West through a central angle of 57 deg. 48' 20 an arc length of 61.54 feet to
the point of tangency on the Southerly boundary of Xxxxx Court, as shown on said
Map; thence along said Southerly boundary South 88 deg. 18 degrees 10" West
517.93 feet to the true point of commencement.
40
AGREEMENT OF PURCHASE AND SALE
------------------------------
AND JOINT ESCROW INSTRUCTIONS
-----------------------------
EXHIBIT "B-2"
-------------
DESCRIPTION OF SUNNYVALE PERSONAL PROPERTY
------------------------------------------
Description to be provided pursuant to Section 5.1(b) as part of "Review
Matters."
41
AGREEMENT OF PURCHASE AND SALE
------------------------------
AND JOINT ESCROW INSTRUCTIONS
-----------------------------
EXHIBIT "C-1"
-------------
LEGAL DESCRIPTION OF SAN XXXXX PROPERTY
---------------------------------------
All that certain real property in the City of Santa Xxxxx, County of Santa
Xxxxx, State of California, described as follows:
All of Parcel A, as shown upon that certain Map entitled, "Parcel Map Xxxx 0-0
xx Xxxxx 0000 Xxxx xx Xxxxx Xxxxx, Xxxxxxxxxx for Xxx Xxxx Co., Inc.," which Map
was filed for record in the Office of the Recorder of the County of Santa Xxxxx,
State of California, on August 7, 1970 in Book 271 of Maps, at Page 22.
42
AGREEMENT OF PURCHASE AND SALE
------------------------------
AND JOINT ESCROW INSTRUCTIONS
-----------------------------
EXHIBIT "C-2"
-------------
DESCRIPTION OF SAN XXXXX PERSONAL PROPERTY
------------------------------------------
Description to be provided pursuant to Section 5.1(b) as part of "Review
Matters."
43
AGREEMENT OF PURCHASE AND SALE
AND JOINT ESCROW INSTRUCTIONS
EXHIBIT "D-1"
LEGAL DESCRIPTION OF SACRAMENTO PROPERTY
All of that certain real property in the City of Sacramento, County of
Sacramento, State of California, described as follows:
PARCEL NO. 1:
All that portion of Parcel F, as said Parcel is shown on the "Plat of Point
West," recorded in Book 82 of Maps, Map No. 17, Records of Sacramento County,
described as follows:
Beginning at the most Southerly corner of said Parcel F, thence from said point
of beginning along the Westerly boundary of said Parcel F the following six (6)
courses and distances: (1) North 12 degrees 20' 00" West 211.45 feet (2)
Northeasterly, curving to the left on arc of 70.00 feet radius, said arc being
subtended by a chord bearing North 48 degrees 55" 25" East 67.32 feet, (3)
continuing on a curve to the left on an arc of 70.00 feet radius, said arc being
subtended by a chord bearing North 57 degrees 58' 44" West 137.03 feet (4)
curving to the right on an arc of 70.00 feet radius, said arc being subtended by
a chord bearing South 71 degrees 11' 53" West 64.27 feet (5) North 15 degrees
38' 13" East 90.00 feet and (6) North 74 degrees 21' 47" West 20.00 feet to a
point located on the Northerly line of a 5.00 foot public utility easement as
shown on the Official Plan of said point West; thence along said North line the
following four (4) courses and distances: (1) North Easterly, curving to the
right of an arc of 2950.00 feet radius, said arc being subtended by a chord
bearing North 86 degrees 35' 56" East 202.19 feet (3) North 88 DG 33' 46" East
158.76 feet and (4) North 00 degrees 17' 32" West 11.83 feet to a point located
on the Northerly boundary of said Parcel F; thence along said Northerly boundary
North 89 degrees 42' 28" East 685.63 feet to the most easterly corner of said
Parcel F, thence along the Southerly boundary of said Parcel F the following
four (4) courses and distances: (1) South 51 degrees 42' 50" West 631.04 feet
(2) curving to the right of an arc of 450.00 feet radius, said arc being
subtended by a chord bearing North 61 degrees 29' 34" East 353.71 feet (2)
curving to the right on an arc of 420.00 feet radius, said arc being subtended
by a chord bearing South 69 degrees 29' 00" West 254.26 feet (3) South 86
degrees 57' 09" West 199.81 feet and (4) curving to the left on an arc of 430.00
feet radius said arc being subtended by a chord bearing South 68 degrees 06' 27"
West 277.79 feet to the point of beginning.
Excepting therefrom all deposits of minerals, including oil and gas, lying below
the depth of 500 feet, without however, the right to drill or mine through the
surface thereof as excepted in the quitclaim deed recorded in Book 71-06-30,
Page 525, Official Records.
Assessor's Parcel Number 277-0282-005-0000
44
PARCEL NO. 2:
Parcel 1, as shown on the Official Plat of point West, as recorded in the Office
of the County Recorder of Sacramento County, June 20, 1968, in Book 82 of Maps,
Map No. 17.
Excepting therefrom all deposits of minerals, including oil and gas, lying below
the depth of five hundred feet, without however, the right to drill through the
surface thereof, as excepted in quitclaim deed executed by the State of
California, recorded June 30, 1971, in Book 71-06-30, Page 525, Official
Records.
Assessor's Parcel Number 277-0284-001-0000.
45
AGREEMENT OF PURCHASE AND SALE
AND JOINT ESCROW INSTRUCTIONS
EXHIBIT "D-2"
DESCRIPTION OF SACRAMENTO PERSONAL PROPERTY
Description to be provided pursuant to Section 5.1(b) as part of "Review
Matters."
46
AGREEMENT OF PURCHASE AND SALE
AND JOINT ESCROW INSTRUCTIONS
EXHIBIT "3.1"
FORM OF STANDARD ESCROW PROVISIONS
1. The phrase "close of escrow" (or XXX) as used in this escrow means the
date on which documents are recorded, unless otherwise specified.
2. Recordation of any instruments delivered through this escrow, if
necessary or proper for the issuance of the policy of title insurance
called for, is authorized.
3. No examination or insurance as to the amount or payment of personal
property taxes is required unless specifically requested.
4. You and any of your affiliates or employees are authorized to use the
information and documents in this escrow for any purpose. You are further
authorized to furnished to any broker or lender identified with this
transaction or anyone acting on behalf of such broker or lender, any
instructions, amendments, statements, or notices of cancellation given in
connection with this escrow.
5. All written notices, communications, change of instructions and documents
are required to be delivered timely at the office of Chicago Title
Company as set forth herein.
6. All funds received in this escrow shall be deposited with other escrow
funds in one or more escrow (demand) accounts of Chicago Title Company in
any state or national bank. The parties to this escrow understand that
the escrow accounts you maintain with the depository institutions
contribute to your value as a customer of these institutions which, in
turn, may make available to Chicago Title Company an array of bank
services, accommodations or other benefits. You shall have no obligation
to account for the value realized by Chicago Title Company from these
services, accommodations or other benefits. All disbursements shall be
made by your check, unless otherwise instructed. You shall not be
responsible for any delay in closing if funds received by escrow are not
available for immediate withdrawal. Chicago Title Company may, at its
option, require concurrent instructions from all principals prior to
release of any funds on deposit in this escrow.
7. If demand to cancel is submitted after the Time Limit Date, any principal
so requesting you to cancel this escrow shall file notice of demand to
cancel in your office in writing. You shall within three (3) working days
thereafter mail by certified mail one copy of such notice to each of the
other principals at the address stated in this escrow. Unless written
objection thereto is filed in your office by a principal within fifteen
(15) calendar days after the date of such mailing, you are instructed to
cancel this escrow.
47
If this is a sale escrow, you may return the lender's papers and/or funds
upon lender's demand.
8. In the event that this escrow is canceled, any fees or charges due
Chicago Title Company including cancellation fees and any expenditures
incurred or authorized shall be paid from funds on deposit unless
otherwise specifically agreed to or determined by a court of competent
jurisdiction. Upon payment thereof, return documents and monies to the
respective parties depositing same, or as ordered by the court, and void
any executed instruments.
9. If there is no written activity by a principal to this escrow within any
six-month period after the Time Limit Date set forth herein, Chicago
Title Company may, at its option, terminate its agency obligation and
cancel this escrow, returning all documents, monies or other items held,
to the respective parties entitled thereto, less any fees and charges as
provided herein.
10. If for any reason, funds are retained or remain in escrow after the
closing date, you may deduct therefrom a reasonable charge as custodian,
of not less than $25.00 per month, unless otherwise specified.
11. In the event that you should receive or become aware of conflicting
demands or claims with respect to this escrow, or the rights of any of
the parties hereto, or any money or property deposited herein, you shall
have the absolute right at your option to discontinue any or all further
acts until such conflict is resolved to your satisfaction.
12. You are released from and shall have no liability, obligation or
responsibility with respect to (a) withholding funds pursuant to Section
1445 of the Internal Revenue Code of 1986 as amended, and to Sections
18662 and 18668 of the California Revenue and Taxation Code, (b) advising
the parties as to the requirements of said Section 1445, (c) determining
whether the transferor is a foreign person or a non-resident under such
Section, nor (d) obtaining a non-foreign affidavit or other exemption
from withholding under said Sections nor otherwise making any inquiry
concerning compliance with such Sections by any party to the transaction.
13. The parties hereto, by execution of these instructions, acknowledge that
the escrow holder assume no responsibility or liability whatsoever for
the supervision of any act or the performance of any condition which is a
condition subsequent to the closing of this escrow.
14. In the absence of instructions to the contrary, you are hereby authorized
to utilize wire services, overnight, next day, or other expedited
delivery services (as opposed to the regular U.S. Mail) and to charge the
respective party's account accordingly.
15. If you pay a demand to reconvey line of credit or equityline deed of
trust, you are hereby instructed on my behalf and for my benefit, to
request that the lender issuing said demand cancel said revolving line or
equityline of credit.
16. You are authorized to destroy or otherwise dispose of any and all
documents, papers, instructions, correspondence and other material
pertaining to this escrow at the expiration of six (6) years from the
close of escrow or cancellation thereof, without liability and without
further notice.
48
IMPORTANT NOTICE
Except for wire transfer, funds remitted to this escrow are subject to
availability requirements imposed by Section 12413.1 of the California Insurance
Code. CASHIER'S, CERTIFIED or TELLER'S checks, payable to CHICAGO TITLE COMPANY
are generally available for disbursement on the next business day following the
date of deposit.
Other forms of payment may cause extended delays in the closing of your
transaction pursuant to the requirements imposed by State Law.
(Wire transfer information available upon request)
ALL PARTIES TO THIS ESCROW ACKNOWLEDGE THAT CHICAGO TITLE COMPANY DOES NOT
PROVIDE LEGAL ADVICE NOR HAS IT MADE ANY INVESTIGATION, REPRESENTATIONS OR
ASSURANCES WHATSOEVER REGARDING THE LEGAL ASPECTS OR COMPLIANCE OF THIS
TRANSACTION WITH ANY TAX, SECURITIES OR ANY OTHER STATE OR FEDERAL LAWS. IT IS
RECOMMENDED THAT THE PARTIES OBTAIN INDEPENDENT LEGAL COUNSEL AS TO SUCH
MATTERS.
IN THE EVENT OF ANY INCONSISTENCY BETWEEN THESE STANDARD PROVISIONS AND THE
TERMS OF THE AGREEMENT TO WHICH THIS EXHIBIT "3.1" IS ATTACHED, THE TERMS OF
SUCH AGREEMENT SHALL CONTROL.
49
AGREEMENT OF PURCHASE AND SALE
AND JOINT ESCROW INSTRUCTIONS
EXHIBIT "3.2"
FORM OF GRANT DEED
RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO:
______ __ ___________________________________________________________________
SPACE ABOVE THIS LINE FOR RECORDERS USE
DOCUMENTARY TRANSFER TAX
$______________________________
...Computed on the consideration or value of
property conveyed; OR
...Computed on the consideration or value less ___________________________
liens or encumbrances remaining at time of sale Signature of Declarant or
Agent determining tax -
Firm Name
________________________________________________________________________________
LIMITED LIABILITY COMPANY GRANT DEED
FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged,
XXX PROPERTIES LLC,
a limited liability company organized under the laws of the State of California,
does hereby GRANT to
____________________________,
the real property in the City of________________, County of ____________, State
of California, described as:
See Exhibit "1" attached hereto and incorporated herein by reference.
The foregoing grant of real property is subject to non-delinquent taxes, all
easements, covenants, conditions and restrictions, and all other matters of
record affecting all or part of the real property which is described in this
Grant Deed and any matters that would be disclosed by a survey of the real
property which is described in this Grant Deed.
Dated:___________________________ ___________________________
50
}
STATE OF CALIFORNIA }ss ___________________________
COUNTY OF__________________________}____ , Managing Member
On _______________________________before ___________________________
me,____________________________________, , Managing Member
personally appeared____________________,
personally known to me (or proved to me
on the basis of satisfactory evidence)
to be the person(s) whose name(s) is/are
subscribed to the within instrument and
acknowledged to me that he/she/they
executed the same in his/her/their
authorized capacity(ies), and that by
his/her/their signature(s) on the
instrument the person(s) or the entity
upon behalf of which the person(s)
acted, executed the instrument.
WITNESS my hand and official seal.
Signature
______________________________________
(This area for official notarial seal)
MAIL TAX STATEMENTS TO:
______________________________________
______________________________________
______________________________________
51
FORM OF GRANT DEED
EXHIBIT "1"
LEGAL DESCRIPTION
52
AGREEMENT OF PURCHASE AND SALE
AND JOINT ESCROW INSTRUCTIONS
EXHIBIT "6(B)"
ASSIGNMENT OF LEASES
This Assignment of Leases (the "Assignment") is executed by XXX
Properties LLC, a California limited liability company ("Seller"), in favor
of_____________________________ (the "Buyer"), with reference to the following
facts:
A. Seller and Buyer have entered into that certain Agreement of
Purchase and Sale and Joint Escrow Instructions dated September 10, 1997 (the
"Purchase Agreement") in which Seller has agreed to sell and Buyer has agreed to
purchase the real property described in Exhibit "1" attached hereto and the
improvements located thereon (collectively, the "Project").
B. Pursuant to the Purchase Agreement, Seller has agreed to assign to
Buyer all of Seller's right, title and interest in and to all leases of space in
the Project (collectively, the "Leases"). THEREFORE, for valuable consideration,
the parties agree as follows:
1. Assignment. Subject to the terms of the Purchase Agreement, Seller
assigns and transfers to Buyer all of Seller's right, title and interest in and
to the Leases effective as of the Close of Escrow (as defined in the Purchase
Agreement). Such assignment is without representation or warranty by, or
recourse to, Seller.
2. Assumption by Buyer. Buyer assumes and agrees to perform all
obligations of the landlord under the Leases arising or accruing from and after
the Close of Escrow (as defined in the Purchase Agreement).
3. Counterparts. This Assignment may be executed in counterparts, each
of which shall be deemed an original, and both of which together shall
constitute one and the same instrument.
4. Miscellaneous. This Assignment shall be binding on the parties and
their respective successors and assigns. The headings to sections of this
Assignment are for convenient reference only and shall not be used in
interpreting this Assignment.
5. Attorneys' Fees. If any action or proceeding is commenced by either
party to enforce its rights under this Assignment, the prevailing party in such
action or proceeding shall be entitled to recover all reasonable costs and
expenses incurred in such action or proceeding, including reasonable attorneys'
fees and costs, in addition to any other relief awarded by the court.
53
6. Indemnification. Buyer agrees to and shall indemnify, defend and
hold Seller harmless from and against any and all claims, costs, demands,
losses, damages, liabilities, lawsuits, actions and other proceedings in law or
in equity or otherwise, judgments, awards and expenses of every kind and nature
whatsoever, including without limitation, attorneys' fees, arising out of or
relating to, directly or indirectly, in whole or in part, the Leases, arising,
occurring and/or relating to the period from and after the Close of Escrow (as
defined in the Purchase Agreement).
7. California Law. This Assignment shall be governed by and
interpreted in accordance with the laws of the State of California.
Dated: ______________________,1997.
BUYER: SELLER:
XXX PROPERTIES LLC,
a California limited liability company
By:___________________________________
Title:________________________________
54
ASSIGNMENT OF LEASES
EXHIBIT "1"
LEGAL DESCRIPTION
All of that certain real property in the City of ________________, County of
___________________ , State of California, described as follows:
55
AGREEMENT OF PURCHASE AND SALE
AND JOINT ESCROW INSTRUCTIONS
EXHIBIT "6(d)"
ASSIGNMENT OF CONTRACTS
This Assignment of Contracts (this "Assignment") is executed by XXX
Properties LLC, a California limited liability company (the "Assignor"), in
favor of _______________(the "Assignee"), with reference to the following facts:
A. Seller and Buyer have entered into that certain Agreement of
Purchase and Sale and Joint Escrow Instructions dated September 10, 1997 (the
"Purchase Agreement") in which Seller has agreed to sell and Buyer has agreed to
purchase the real property and improvements more particularly described in the
Purchase Agreement (collectively, the "Project").
B. Pursuant to the Purchase Agreement, Seller has agreed to assign to
Buyer those certain service agreements, maintenance agreements, and other
contracts listed on Exhibit "1" attached hereto (collectively, the "Contracts").
THEREFORE, for valuable consideration, the parties agree as follows:
1. Assignment. Subject to the terms of the Purchase Agreement,
Assignor hereby assigns and transfers to Assignee, effective as of the Close of
Escrow (as defined in the Purchase Agreement), all of Assignor's right, title
and interest in each of the Contracts effective as of the Close of Escrow (as
defined in the Purchase Agreement). Such assignment is without representation or
warranty by, or recourse to, Seller.
2. Assumption. Assignee hereby agrees to and accepts the assignment of
Assignor's rights under each of the Contracts as provided in Section 1 above,
and Assignee assumes and agrees to perform all obligations required to be kept
and performed by Assignor under each of the Contracts arising or accruing from
and after the Close of Escrow (as defined in the Purchase Agreement).
3. Counterparts. This Assignment may be executed in counterparts, each
of which shall be deemed an original, and both of which together shall
constitute one and the same instrument.
4. Miscellaneous. This Assignment shall be binding on the parties and
their respective successors and assigns. The headings to sections of this
Assignment are for convenient reference only and shall not be used in
interpreting this Assignment.
56
5.Indemnification. Assignee agrees to and shall indemnify, defend and
hold Assignor harmless from and against any and all claims, costs, demands,
losses, damages, liabilities, lawsuits, actions and other proceedings in law or
in equity or otherwise, judgments, awards and expenses of every kind and nature
whatsoever, including without limitation, attorneys' fees, arising out of or
relating to, directly or indirectly, in whole or in part, the Contracts,
arising, occurring and/or relating to the period from and after the Close of
Escrow (as defined in the Purchase Agreement).
6.Attorneys' Fees. If any action or proceeding is commenced by either
party to enforce its rights under this Assignment, the prevailing party in such
action or proceeding shall be entitled to recover all reasonable costs and
expenses incurred in such action or proceeding, including reasonable attorneys'
fees and costs, in addition to any other relief awarded by the court.
Dated:_________________, 1997.
ASSIGNOR:
XXX PROPERTIES LLC, a California limited
liability company
By:_____________________________________
Title:__________________________________
ASSIGNEE:
________________________________________
By:_____________________________________
Title:__________________________________
57
ASSIGNMENT OF CONTRACTS
EXHIBIT "1"
CONTRACTS
[TO BE PROVIDED]
58
AGREEMENT OF PURCHASE AND SALE
AND JOINT ESCROW INSTRUCTIONS
EXHIBIT "6(e)"
XXXX OF SALE AND ASSIGNMENT OF PERSONAL PROPERTY
This Xxxx of Sale and Assignment of Personal Property (the
"Assignment") is executed by XXX Properties LLC, a California limited liability
company (the "Seller"), in favor of _____________________________(the "Buyer"),
with reference to the following facts:
A. Seller and Buyer have entered into that certain Agreement of
Purchase and Sale and Joint Escrow Instructions dated September 10, 1997 (the
"Purchase Agreement") in which Seller has agreed to sell and Buyer has agreed to
purchase the real property and improvements more particularly described in the
Purchase Agreement (collectively, the "Project").
B.Pursuant to the Purchase Agreement, Seller has agreed to sell and
assign to Buyer all of Seller's right, title and interest in and to the personal
property described in Exhibit "1" attached hereto (the "Personal Property").
THEREFORE, for valuable consideration, Seller agrees as follows:
1. Assignment. Subject to the terms of the Purchase Agreement, Seller
assigns, sells and transfers to Buyer all of Seller's right, title and interest
in and to the Personal Property effective as of the Close of Escrow (as defined
in the Purchase Agreement). Such assignment, sale and transfer are without
representation or warranty by, or recourse to, Seller.
2. Counterparts. This Assignment may be executed in counterparts, each
of which shall be deemed an original, and both of which together shall
constitute one and the same instrument.
3. Miscellaneous. This Assignment shall be binding on the parties and
their respective successors and assigns. The headings to sections of this
Assignment are for convenient reference only and shall not be used in
interpreting this Assignment.
4.Attorneys' Fees. If any action or proceeding is commenced by either
party to enforce its rights under this Assignment, the prevailing party in such
action or proceeding shall be entitled to recover all reasonable costs and
expenses incurred in such action or proceeding, including reasonable attorneys'
fees and costs, in addition to any other relief awarded by the court.
59
5. California Law. This Assignment shall be governed by and
interpreted in accordance with the laws of the State of California.
Dated:______________, 1997.
SELLER:
XXX PROPERTIES LLC,
a California limited liability company
By:____________________________________
Title:_________________________________
Accepted and Agreed:
BUYER:
______________________________________
By:___________________________________
Title:________________________________
60
AGREEMENT OF PURCHASE AND SALE
AND JOINT ESCROW INSTRUCTIONS
EXHIBIT "6(F)"
TRANSFEROR'S CERTIFICATION OF NON-FOREIGN STATUS
To inform_____________________________ ("Transferee"), that withholding of tax
under Section 1445 of the Internal Revenue Code (the "Code") will not be
required upon the transfer of certain real property to the Transferee by XXX
Properties LLC, a California limited liability company ("Transferor"), the
undersigned hereby certifies the following on behalf of the Transferor:
1. The Transferor is not a foreign corporation, foreign partnership,
foreign trust, or foreign estate (as those terms are defined in the Code and the
Income Tax Regulations promulgated thereunder);
2. The Transferor's U.S. tax identification number
is__________________ ; and
3 .The Transferor's office address is 0000 Xxxxxxx Xxxxxx, Xxx
Xxxxxxx, Xxxxxxxxxx 00000.
The Transferor understands that this Certification may be disclosed to
the Internal Revenue Service by the Transferee and that any false statement
contained herein could be punished by fine, imprisonment, or both.
The Transferor understands that the Transferee is relying on this
Certification in determining whether withholding is required upon said transfer.
Under penalty of perjury I declare that I have examined this
Certification and to the best of my knowledge and belief it is true, correct and
complete, and I further declare that I have authority to sign this document on
behalf of the Transferor.
Dated:__________________, 1997.
XXX PROPERTIES LLC,
a California limited liability company
By:____________________________________
Title:_________________________________
61
AGREEMENT OF PURCHASE AND SALE
AND JOINT ESCROW INSTRUCTIONS
EXHIBIT "8.1.3"
TENANT ESTOPPEL CERTIFICATE
TO WHOM IT MAY CONCERN:
The undersigned certifies and confirms that as of the date of this
Certificate:
1 The undersigned is the tenant under that certain lease
dated_______________ , 19______, as modified by amendments dated_______________
(collectively, the "Lease") by and between XXX Properties LLC, a California
limited liability company ("Landlord"), as the successor-in-interest to the
original landlord under the Lease if the original landlord was not Landlord, and
________________________________________________________ ("Tenant") covering
those certain premises commonly known and designated
as______________________________________________________________________
California (the "Premises"), and located in the building or improvements (the
"Building") on the real property commonly known as______________________________
_______________________________________________________ (the "Real Property").
The Building and Real Property are referred to collectively as the "Property".
2. The following information regarding the Lease is true and correct:
(a) Lease term expiration date: ________________________, 19__
(b) Current minimum monthly base rent: $______________________
(c) Minimum monthly base rent is paid to and including:
_________________________, 19__
(d) Additional rent or monthly charges are being paid to
Landlord for, among other things, operating expenses,
common area maintenance and real property taxes, in the
following amount per month: $ ____________________________
(e) Amount of security deposit held by Landlord under the
Lease: $__________________________________________________
3. Tenant has unexercised options to extend or renew the Lease term
for a total of_____________________ years [if no options exist, insert "None"].
4. The Lease represents the entire agreement between Tenant and
Landlord regarding the Premises. The Lease has not been modified in any respect,
except for the amendments which are part of the Lease as noted in Section 1
above.
5. The Lease is in full force and effect and to Tenant's knowledge,
there are no uncured defaults on the part of Landlord, or events or conditions
that with the passage of time, the giving of notice, or both, would constitute a
default by Landlord under the Lease.
62
6. Tenant acknowledges and agrees that this certificate may be relied
upon by (a) any prospective purchaser of the Property in connection with such
purchaser's acquisition of the Property from Landlord; and (b) any lender
financing such purchaser's acquisition of the Property.
Dated:_________________, 1997.
TENANT:
_______________________________________
By:____________________________________
Title:_________________________________
