EXHIBIT 10(jj)
AGREEMENT FOR THE PURCHASE AND SALE OF PROPERTY
-----------------------------------------------
THIS AGREEMENT FOR THE PURCHASE AND SALE OF PROPERTY (the "Agreement"), is
made and entered into as of the _____ day of December, 1996, by and between
MAGELLAN BAKE PARKWAY LIMITED PARTNERSHIP, an Arizona limited partnership
(hereinafter referred to as "Seller"), and XXXXX PARTNERS, L.P., a Georgia
limited partnership (hereinafter referred to as "Purchaser").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, Seller desires to sell and Purchaser desires to purchase the Property
(as hereinafter defined) subject to the terms and conditions hereinafter set
forth.
NOW, THEREFORE, for and in consideration of the premises, the mutual
agreements contained herein, the sum of Ten Dollars ($10.00) in hand paid by
Purchaser to Seller at and before the sealing and delivery of these presents and
for other good and valuable consideration, the receipt, adequacy, and
sufficiency which are hereby expressly acknowledged by the parties hereto, the
parties hereto do hereby covenant and agree as follows:
1. Purchase and Sale of Property. Subject to and in accordance with the
-----------------------------
terms and provisions of this Agreement, Seller hereby agrees to sell to
Purchaser and Purchaser hereby agrees to purchase from Seller, the Property,
which term "Property" shall mean and include the following:
(a) all that tract or parcel of land located in Irvine, Orange County,
California containing approximately 4.407 acres, and being more
particularly described on Exhibit "A" attached hereto and by this reference
made a part hereof (herein referred to as the "Land"); and
(b) all of Seller's rights, privileges, and easements appurtenant to the
Land, and all of Seller's water rights, mineral rights, reversions, or
other appurtenances to said Land, and all right, title, and interest of
Seller, if any, in and to any land lying in the bed of any street, road,
alley, or right-of-way, open or proposed, adjacent to or abutting the Land;
and
(c) all buildings, structures, and improvements situated on the Land,
including, without limitation, that certain two story office building
containing approximately 63,500 rentable square feet of space, the
parking areas containing approximately 404 parking spaces and other
amenities constructed on the Land, and all apparatus, built-in appliances,
equipment, pumps, machinery, plumbing, heating, air conditioning,
elevators, electrical and other fixtures located on or to be located on the
Land (all of which are herein collectively referred to as the
"Improvements"); and
(d) all personal property located on or to be located on or in, or used
in connection with, the Land and Improvements, (all of which are herein
collectively referred to as the "Personal Property"); and
(e) all of Seller's right, title, and interest, as landlord or lessor,
in and to the Lease (as hereinafter defined); and
(f) all of Seller's right, title, and interest, if any, in and to the
plans and specifications with respect to the Improvements and any
guarantees, trademarks, rights of copyright, warranties, or other rights
related to the ownership of or use and operation of the Land, Personal
Property, or Improvements, all governmental licenses and permits, and all
intangibles associated with the Land, Personal Property, and Improvements,
including the name of the Improvements and the logo therefor, if any.
2. Xxxxxxx Money. Within two (2) business days after the Effective Date,
-------------
Purchaser shall deliver to First American Title Insurance Company ("Escrow
Agent"), whose offices are at 000 Xxxx Xxxxx Xxxxxx, Xxxxx Xxx, Xxxxxxxxxx
00000, Purchaser's check, payable to Escrow Agent, in the amount of $100,000
(the "Xxxxxxx Money"), which Xxxxxxx Money shall be held and disbursed by Escrow
Agent pursuant to this Agreement. The Xxxxxxx Money shall be paid by Escrow
Agent to Seller at Closing (as hereinafter defined) and shall be applied as a
credit to the Purchase Price (as hereinafter defined), or shall otherwise be
paid to Seller or refunded to Purchaser in accordance with the terms of this
Agreement. All interest and other income from time to time earned on the Xxxxxxx
Money shall belong to Purchaser and shall be disbursed to Purchaser at any time
and from time to time as Purchaser shall direct Escrow Agent, all as provided in
the Escrow Agreement. In no event shall any such interest or other income be
deemed a part of the Xxxxxxx Money.
3. Purchase Price. Subject to adjustment and credits as otherwise
--------------
specified in this Agreement, the purchase price (the "Purchase Price") to be
paid by Purchaser to Seller for the Property shall be Seven Million, one Hundred
Ninety Three Thousand Dollars ($7,193,000.00). The Purchase Price shall be
deposited by Purchaser with Escrow Agent one (1) day prior to the Closing (as
hereinafter defined) by wire transfer of immediately available federal funds,
less the amount of Xxxxxxx Money and subject to prorations, adjustments and
credits as otherwise specified in this Agreement.
4. Purchaser's Inspection and Review Rights. Commencing on the Effective
----------------------------------------
Date and ending on the Closing Date, and subject to the rights of the Tenant (as
hereinafter defined), Purchaser and its agents, engineers, or representatives,
with Seller's
2
reasonable, good faith cooperation, shall have the privilege of going upon the
Property as needed to inspect, examine, test, and survey the Property at all
reasonable times and from time to time. Such privilege shall include the right
to make tests, borings, and other tests to obtain information necessary to
determine surface and subsurface conditions, provided, however, that no borings
shall be made without the advance written consent of Seller, which consent shall
not be unreasonably withheld. Seller in its sole and absolute but reasonable
discretion, shall have the right to approve all consultants conducting any tests
as well as the scope of any invasive testing on the Property prior to the
Purchaser conducting such testing. Such privilege shall also include the right
to make any other tests deemed reasonably necessary by Purchaser. Purchaser
hereby agrees to indemnify and hold Seller harmless from any liens, claims,
liabilities, expenses and damages, including, without limitation, reasonable
attorney's fees, incurred through the exercise of such privilege, and Purchaser
further agrees to repair any damage to the Property caused by the exercise of
such privilege. At all reasonable times prior to the Closing (as hereinafter
defined), Seller shall make available to Purchaser, or Purchaser's agents and
representatives, and for copying at Purchaser's expense, all books, records, and
files in Seller's possession relating to the ownership and operation of the
Property, including, without limitation, title matters, surveys, tenant files,
service and maintenance agreements, and other contracts, books, records,
operating statements, and other information relating to the Property. Seller
further agrees to in good faith assist and cooperate with Purchaser, at no cost
to Seller, in coming to a thorough understanding of the books, records, and
files relating to the Property. Seller further agrees to provide copies of any
of such books, records, and files as may be reasonably requested by Purchaser,
with the copying costs to be borne by Purchaser. Seller further agrees to
provide to Purchaser prior to the date which is five (5) business days after the
Effective Date those items listed on Exhibit "B" hereto which are in the
possession of Seller or which Seller can obtain with a reasonable effort and
which have not been previously delivered to Purchaser. Purchaser acknowledges
that Seller has provided to Purchaser prior to the Effective Date, a statement
setting forth all revenues from the Property and setting forth all costs and
expenses of operating, maintaining, and repairing the Property (and the costs of
replacing component parts thereof) incurred by Seller, in each case during the
period of its ownership. The provisions of this paragraph 4 shall survive the
Closing or any termination of this Agreement. Purchaser represents and covenants
that Seller shall not have any liability, obligation or responsibility of any
kind with respect to the following, unless Seller actually knew that any
document was inaccurate, misleading or failed to provide material information:
(a) The content or accuracy of any report, study, opinion or conclusion
of any soils, toxic, environmental or other engineer or other person or
entity who has examined the Property or any aspect thereof.
3
(b) The content or accuracy of any information released to Purchaser by
an engineer or planner in connection with the development of the Property.
(c) The availability of building or other permits or approvals for the
Property by any state or local governmental bodies with jurisdiction over
the Property.
(d) The availability or capacity of sewer, water or other utility
connections to the Property.
(e) Any of the items delivered to Purchaser pursuant to Purchaser's
review of the condition of the Property.
(f) The content or accuracy of any other development or construction
cost, projection, financial or marketing analysis or other information
given to Purchaser by Seller or reviewed by Purchaser with respect to the
Property.
5. Special Condition to Closing. Subject to the limitations set forth in
----------------------------
paragraph 4 above, Purchaser shall have until Closing (the "Inspection Period")
to make investigations, examinations, inspections, market studies, feasibility
studies, lease reviews, and tests relating to the Property and the operation
thereof in order to determine, in Purchaser's sole opinion and discretion, the
suitability of the Property for acquisition by Purchaser. Purchaser shall have
the right to terminate this Agreement at any time prior to the expiration of the
Inspection Period by giving written notice to Seller of such election to
terminate. In the event this Agreement is so terminated, Seller shall be
entitled to receive the sum of One Hundred Dollars ($100) of the Xxxxxxx Money,
and the balance of the Xxxxxxx Money shall be promptly refunded by Escrow Agent
to Purchaser, whereupon, except as expressly provided to the contrary in this
Agreement, Purchaser shall have no further right to purchase the Property and no
party hereto shall have any other or further rights or obligations under this
Agreement. Seller acknowledges that the sum of $100 is good and adequate
consideration for the termination rights granted to Purchaser hereunder.
6. General Conditions Precedent to Purchaser's Obligations Regarding the
---------------------------------------------------------------------
Closing. In addition to any other conditions to Purchaser's obligations
-------
hereunder, the obligations and liabilities of Purchaser hereunder shall in all
respects be conditioned upon the satisfaction of each of the following
conditions prior to or simultaneously with the Closing (as hereinafter defined),
any of which may be waived by written notice from Purchaser to Seller:
(a) Seller shall have complied in all material respects with and
otherwise performed in all material respects each of the covenants and
obligations of Seller set forth in this Agreement.
4
(b) All representations and warranties of Seller as set forth in this
Agreement shall be true and correct in all material respects as of the date
of Closing.
(c) There shall have been no material adverse change to the title to the
Property which has not been cured and the Title Company (as hereinafter
defined) shall have issued the Title Report (as hereinafter defined) on the
Land and Improvements without exceptions other than as have been approved
by Purchaser as Permitted Exceptions (as hereinafter defined) and the Title
Company shall be prepared to issue to Purchaser upon the Closing an ALTA
Owner's Title Insurance Policy on the Land and Improvements pursuant to
such Title Report.
(d) Purchaser shall have received the Tenant Estoppel Certificate
referred to in Paragraph 9(c) hereof, duly executed by the Tenant (as
hereinafter defined).
(e) Purchaser shall have received a date-down on the Title Report
through the date and time of recording the Grant Deed from Seller to
Purchaser, to reflect that Purchaser is vested with the fee simple title to
the Land and the Improvements, and to reflect that all requirements for the
issuance of the final title policy pursuant to such Title Commitment have
been satisfied.
(f) At no cost to Seller, Seller shall use reasonable efforts to cause
the entity which issued the environmental site assessment report to Seller
to address its report to Purchaser in such a way that Purchaser shall be
entitled to rely on same.
(g) Purchaser's obligations and liabilities hereunder shall be
conditioned upon Purchaser receiving, at Purchaser's sole cost and expense,
prior to the Closing, an appraisal of the Land and Improvements (as
encumbered by the Lease) from a competent independent appraiser selected by
Purchaser which shall state that the Land and Improvements have a value
equal to or exceeding the Purchase Price. If the appraisal received by the
Purchaser shall reflect a value of the Land and Improvements which is less
than the Purchase Price, Purchaser shall have the right to terminate this
Agreement prior to the Closing by giving written notice to Seller of such
election to terminate. In the event Purchaser so elects to terminate this
Agreement, Seller shall be entitled to receive $100 of the Xxxxxxx Money
from Escrow Agent, and Purchaser shall be entitled to a return of the
balance of the Xxxxxxx Money, if any, from Escrow Agent, Purchaser shall
have no further right to acquire the Property, and no party hereto shall
have any other or future rights or obligations under this Agreement, except
as expressly provided to the contrary herein.
5
7. Title and Survey. Seller covenants and agrees that Seller, at its
----------------
sole cost and expense, shall, on or before seven (7) days after the Effective
Date of this Agreement cause First American Title Insurance Company, or such
other such title insurance company acceptable to Purchaser (herein referred to
as the "Title Company"), to deliver to Purchaser its Preliminary Title Report
(herein referred to as the "Title Report") to issue to Purchaser, upon the
recording of the Grant Deed conveying title to the Property from Seller to
Purchaser, the payment of the Purchase Price, and the payment to the Title
Company of the policy premium therefor, an ALTA Owner's Policy of Title
Insurance with endorsements covering survey and zoning, in the amount of the
Purchase Price, insuring good and marketable fee simple record title to the
Property to be in Purchaser without exception (including any general exception)
except for matters approved by Purchaser (herein referred to as the ("Permitted
Exceptions"). The Title Policy to be issued shall not contain any exception for
mechanic's or materialman's liens or any exception for unpaid taxes other than
an exception for taxes not yet due and payable. Such Title Policy shall not
contain any exception for rights of parties in possession other than an
exception for the rights of the Tenant (as hereinafter defined) under the Lease.
If the Title Report shall contain an exception for the state of facts which
would be disclosed by a survey of the Property or an "area and boundaries"
exception, the Title Report shall provide that such exception will be deleted
upon the presentation of an "as-built" survey, in which case the Title Report
shall be amended to contain an exception only for the matters shown on the as-
built survey which Seller shall obtain at its sole cost and expense for the
benefit of Purchaser. Seller shall also cause to be delivered to Purchaser
together with such Title Report, legible copies of all documents and instruments
referred to therein. Purchaser, upon receipt of the Title Report and the copies
of the documents and instruments referred to therein, shall then have until
Closing during which to examine the same, after which Purchaser shall notify
Seller of any defects or objections affecting the marketability of the title to
the Property other than the Permitted Exceptions. Seller shall then have until
the Closing to cure such defects and objections and shall, in good faith,
exercise reasonable diligence to cure such defects and objections. If Seller
fails to satisfy such defects or objections by the date of Closing, then, at the
option of Purchaser: (i) if any such defects or objections arose by, through, or
under Seller or if any such defects or objections consist of taxes, mortgages,
deeds of trust, deeds to secure debt, mechanic's or materialman's liens (not
exceeding $20,000), or other such monetary encumbrances, Purchaser shall have
the right to cure such defects or objections, in which event the Purchase Price
shall be reduced by an amount equal to the costs and expenses incurred by
Purchaser in connection with the curing of such defects or objections, and upon
such curing, the Closing hereof shall proceed in accordance with the terms of
this
6
Agreement; or (ii) Purchaser shall have the right to terminate this Agreement by
giving written notice of such termination to Seller, whereupon Escrow Agent
shall promptly refund all Xxxxxxx Money to Purchaser, Purchaser shall have no
further right to purchase the Property and Purchaser and Seller shall have no
further rights, obligations, or liabilities hereunder, except as may be
expressly provided to the contrary herein; or (iii) Purchaser shall have the
right to accept title to the Property subject to such defects and objections
with no reduction in the Purchase Price, in which event such defects and
objections shall be deemed "Permitted Exceptions" above. Except as expressly
provided to the contrary herein, Seller makes no warranty of any kind with
respect to the title of the Property and Purchaser agrees to look solely to the
remedies afforded by Purchaser's title insurance policy with regard to the
condition of title.
8. Representations and Warranties of Seller. Seller hereby makes the
----------------------------------------
following representations and warranties to Purchaser:
(a) Lease. Seller has delivered to Purchaser a true and accurate copy of
-----
the only lease in effect relating to the Property, together with all
modifications and amendments to such lease, the cover page of which is
attached as Exhibit "A" (such lease, as modified and amended, being herein
referred to as the "Lease"). Seller is the "landlord" under the Lease and
the rents and other income thereunder, subject only to the collateral
assignment of the Lease and the rents thereunder in favor of the holder of
any existing mortgage or deed of trust encumbering the Property, which
mortgage or deed of trust shall be canceled and satisfied by Seller at the
Closing. Matsushita Avionics Systems Corporation is the tenant ("Tenant")
under the Lease.
(b) Lease - Assignment. To Seller's knowledge, the Tenant has not
------------------
assigned its interest in the Lease or sublet any portion of its premises
under the Lease.
(c) Lease - Default. (i) Seller has not received any notice of
---------------
termination or default under the Lease, (ii) to the Seller's knowledge
there are no existing or uncured defaults by Seller or by the Tenant under
the Lease, (iii) to the Seller's knowledge there are no events which with
the passage of time or notice, or both, would constitute a default by
Seller or by the Tenant, and Seller has complied with each and every
undertaking, covenant, and obligation of landlord under the Lease, and (iv)
Seller has not received notice that Tenant has asserted any defense, set-
off, or counterclaim with respect to its tenancy or its obligation to pay
rent, additional rent, or other charges under the Lease.
7
(d) Lease - Rents and Special Consideration. Tenant: (i) has not prepaid
---------------------------------------
rent for more than one month in advance under the Lease, (ii) is not
entitled to receive any rent concession in connection with its tenancy
under the Lease which has not already been received except as expressly
provided therein, (iii) is not entitled to any special work (not yet
performed), or consideration (not yet given) in connection with its tenancy
under the Lease; and (iv) does not have any deed, option, or other evidence
of any right or interest in or to the Property, except as evidenced by the
express terms of the Lease.
(e) Lease - Commissions. No rental, lease, or other commissions with
-------------------
respect to the Lease is payable to Seller, any partner of Seller, any party
affiliated with or related to Seller or third party. All commissions
payable under, relating to, or as a result of the Lease has been cashed-out
and paid and satisfied in full by Seller or by Seller's predecessor in
title to the Property.
(f) Service Contracts. There are no service contracts with Seller (as
-----------------
opposed to Tenant) which are in effect and which relate to the operation,
management, or maintenance the Property which will continue in effect after
Closing. Seller has canceled or will cancel, effective as of the Closing,
any agreement in the nature of a management agreement or service contract
between Seller and any partner or shareholder of Seller or any party
affiliated with or related to Seller or any partner or shareholder of
Seller.
(g) No Other Agreements. Other than the Lease and the Permitted
-------------------
Exceptions, Seller has not entered into any leases, service contracts,
management agreements, or other agreements or instruments, to which Seller
is a party and that grant to any person whomsoever or any entity whatsoever
any right, title, interest or benefit in or to all or any part of the
Property or any rights relating to the use, operation, management,
maintenance, or repair of all or any part of the Property and which will
extend beyond the Closing.
(h) No Litigation. To Seller's knowledge, there are no actions, suits,
-------------
or proceedings pending, or, threatened by any organization, person,
individual, or governmental agency against Seller with respect to the
Property or against the Property, nor does Seller have any knowledge of any
basis for such action. Seller has no knowledge of any pending or threatened
application for changes in the zoning applicable to the Property or any
portion thereof.
(I) Condemnation. To Seller's knowledge no condemnation or other taking
------------
by eminent domain of the Property or any portion thereof has been
instituted and, there are no pending or threatened condemnation or eminent
8
domain proceedings (or proceedings in the nature or in lieu thereof)
affecting the Property or any portion thereof or its use.
(j) Proceedings Affecting Access. The Property is served by a curb cut
----------------------------
for direct vehicular access to and from Bake Parkway, adjoining the
Property, which is a public road. To Seller's knowledge, there are no
pending or threatened proceedings that could have the effect of impairing
or restricting access between the Property and such adjacent public road.
(k) No Assessments. To Seller's knowledge, no assessments have been made
--------------
against the Property that are unpaid, whether or not they have become
liens, and there are no pending assessments, except as shown on the Title
Report.
(l) Violations. Seller has not received written notice of any violations
----------
of law, municipal or county ordinances, or other legal requirements with
respect to the Property that remain uncured, nor any notice that
Improvements thereon do not comply with any legal requirements with respect
to the use, occupancy and construction thereof. To Seller's knowledge, the
Property is currently zoned in a classification such as will permit the
operation of the Property for the uses specified in the Lease and the
conditions, if any, to the granting of the zoning of the Property have been
satisfied. To Seller's knowledge, the Improvements located on the Property
are not located in a flood plain.
(m) Improvements. Except as disclosed to Purchaser in any due diligence
------------
materials supplied to Purchaser pursuant to this Agreement and except for
the variable air volume valves in the HVAC system, to Seller's knowledge,
there are no structural or other defects, latent or otherwise, in the
Improvements, the heating, ventilating, air conditioning, electrical,
plumbing, water, roofing, elevators (if any), storm drainage and sanitary
sewer systems at or servicing the Land and Improvements are in good
condition and working order and there are no defects or deficiencies,
latent or otherwise, therein.
(n) Employees. There are no employment, collective bargaining, or
---------
similar agreements or arrangements between Seller and any of its employees
or others which will be binding on Purchaser or any of Purchaser's
successors in title.
(o) Bankruptcy. Seller is solvent and has not made a general assignment
----------
for the benefit of creditors nor been adjudicated a bankrupt or insolvent,
nor has a receiver,
9
liquidator, or trustee for any of Seller's properties (including the
Property) been appointed or a petition filed by or to Seller's knowledge
against Seller for bankruptcy, reorganization, or arrangement pursuant to
the Federal Bankruptcy Act or any similar Federal or state statute, or any
proceeding instituted for the dissolution or liquidation of Seller.
(p) Pre-existing Right to Acquire. No person or entity has any right or
-----------------------------
option to acquire the Property or any portion thereof which will have any
force or effect after the execution of this Agreement, other than
Purchaser, except as set forth in the Lease, provided, however, Purchaser
has been informed of letter of intent between Seller and The Oxford Real
Estate Investment Trust which has by its terms expired.
(q) Effect of Certification. Neither this Agreement nor the transactions
-----------------------
contemplated herein will constitute a breach or violation of, or default
under, or will be modified, restricted, or precluded by the Leases, the
Service Contracts, or the Permitted Exceptions.
(r) Authorization. Seller is a duly organized and validly existing
-------------
limited partnership under the laws of the State of Arizona and has duly
registered in any jurisdiction where it is required to do so. This
Agreement has been duly authorized and executed on behalf of Seller and
constitutes the valid and binding agreement of Seller, enforceable in
accordance with its terms, and all necessary action on the part of Seller
to authorize the transactions herein contemplated has been taken, and no
further action is necessary for such purpose.
(s) Seller Not a Foreign Person. Neither Seller nor the owner of
---------------------------
beneficial title to the Property is a "foreign person" which would subject
Purchaser to the withholding tax provisions of Section 1445 of the Internal
Revenue Code of 1986, as amended.
(t) Utilities. To Sellers knowledge all utilities necessary for the use
---------
of the Property as an office building of the size and nature situated
thereon, including water, sanitary sewer, storm sewer, electricity, and
telephone, are installed and operational, and such utilities either enter
the Property through adjoining public streets, or, if they pass through
adjoining private land, do so in accordance with valid public easements or
private easements which inure to the benefit of the Property. All
installation and connection charges for utilities serving the Property have
been paid in full.
10
(u) Tax Returns. All property tax returns required to be filed by Seller
-----------
relating to the Property under any law, ordinance rule, regulation, order,
or requirement of any governmental authority have been, or will be, as the
case may be, truthfully, correctly, and timely filed.
At Closing, Seller shall represent and warrant to Purchaser that all
representations and warranties of Seller in this Agreement remain true and
correct as of the date of the Closing, except for any changes in any such
representations or warranties that occur and are disclosed by Seller to
Purchaser expressly and in writing at any time and from time to time prior to
Closing, which disclosures shall thereafter be updated by Seller to the date of
Closing. If there is any change in any representations or warranties and Seller
does not cure or correct such changes prior to Closing, then Purchaser may, at
Purchaser's option, (i) close and consummate the transaction contemplated by
this Agreement, or as its sole and exclusive remedy (ii) terminate this
Agreement by written notice to Seller, whereupon the Xxxxxxx Money shall be
immediately returned by Escrow Agent to Purchaser, Purchaser shall have no
further right to purchase the Property and thereafter the parties hereto shall
have no further rights or obligations hereunder, except only for such rights or
obligations that, by the express terms hereof, survive any termination of this
Agreement. As set forth in this Agreement, "to Seller's knowledge" shall mean
the actual, current knowledge of Xxxx Xxxxxxxxxx or any officer or employee of
Seller with respect to the Property, without undertaking any independent
investigation with respect to the matters represented. The foregoing
representatives and warranties shall survive the Closing for a period of one (1)
year and shall thereafter be of no further force and effect. Except as
expressly provided herein, Purchaser is acquiring the Property "AS IS" without
any representation or warranty of Seller, express, implied or statutory, as to
the nature or condition of or title to the Property or its fitness for
Purchaser's intended use of same. Purchaser is, or as of the Closing Date will
have conducted, its own, independent inspection, investigation and analysis of
the Property as it deems necessary or appropriate in so acquiring the Property
from Seller, including, without limitation, an analysis of any and all matters
concerning the condition of the Property and its suitability for Purchaser's
intended purposes, and a review of all applicable laws, ordinances, rules and
governmental regulations (including, but not limited to, those relative to
building, zoning and land use) affecting the development, use, occupancy or
enjoyment of the Property.
9. Seller's Additional Covenants. Seller does hereby further covenant
-----------------------------
and agree as follows:
(a) Operation of Property. Seller hereby covenants that, from the date
---------------------
of this Agreement up to and including
11
the date of Closing, Seller shall: (i) not negotiate with any third party
respecting the sale of the Property or any interest therein, (ii) not
modify, amend, or terminate the Lease or enter into any new lease,
contract, or other agreement respecting the Property, without the consent
of Purchaser, which consent shall not be withheld or delayed and (iii) not
grant or otherwise create or consent to the creation of any easement,
restriction, lien, assessment, or encumbrance respecting the Property.
(b) Preservation of Lease. Seller shall, from and after the date of this
---------------------
Agreement to the date of Closing, use its best efforts to perform and
discharge all of the duties and obligations and shall otherwise comply with
every covenant and agreement of the landlord under the Lease, at Seller's
expense, in the manner and within the time limits required thereunder.
Furthermore, Seller shall, for the same period of time, use diligent and
good faith efforts to cause the Tenant under the Lease to perform all of
its duties and obligations and otherwise comply with each and every one of
its covenants and agreements under such Lease and shall take such actions
as are reasonably necessary to enforce the terms and provisions of the
Lease.
(c) Tenant Estoppel Certificate. Prior to Closing, Seller shall obtain
---------------------------
and deliver to Purchaser a fully completed estoppel certificate with
respect to the Lease (herein referred to as the "Tenant Estoppel
Certificate") duly executed by the Tenant thereunder in the form attached
hereto as Exhibit " D ". The Tenant Estoppel Certificate shall be executed
---
as of a date not more than twenty (20) days prior to Closing.
(d) Insurance. From and after the date of this Agreement to the date and
---------
time of Closing, Seller shall, at its expense, continue to maintain the
insurance policies covering the Property which are currently in force and
effect.
(e) Securities Act Compliance. Seller acknowledges that Purchaser may be
-------------------------
required by the Securities and Exchange Commission to file audited
financial statements for one to three years with regard to the Property. At
no cost or liability to Seller, Seller shall (i) cooperate with Purchaser,
its counsel, accountants, agents, and representatives, provide them with
access to Seller's books and records with respect to the ownership,
management, maintenance, and operation of the Property for the applicable
period, and permit them to copy the same,(ii) execute a form of "rep"
letter in form and substance reasonably satisfactory to Seller, and (iii)
furnish Purchaser with such additional information concerning the
12
same as Purchaser shall reasonably request. Purchaser will pay the costs
associated with any such audit. The terms of this paragraph shall survive
Closing.
10. Closing. Provided that all of the conditions set forth in this
-------
Agreement are theretofore satisfied or performed in all material respects, it
being fully understood and agreed, however, that Purchaser may expressly waive
in writing, at or prior to Closing, any conditions that are unsatisfied or
unperformed at such time, the consummation of the sale by Seller and purchase by
Purchaser of the Property (herein referred to as the "Closing") shall be held on
or before January 9, 1997, and at such specific time, and date as shall be
designated by Purchaser in a written notice to Seller not less than two (2)
business days prior to Closing at the office of the Title Company.
11. Seller's Closing Documents. For and in consideration of, and as a
--------------------------
condition precedent to, Purchaser's delivery to Seller of the Purchase Price
described in Paragraph 3 hereof, Seller shall obtain or execute, at Seller's
expense, and deliver to Purchaser at Closing the following documents (all of
which shall be duly executed, acknowledged, and notarized where required):
(a) Grant Deed. A Grant Deed ("Grant Deed") in the form attached hereto
----------
as Exhibit "E" conveying to Purchaser fee simple title to the Land and
-
Improvements, together with all rights, members, easements, and
appurtenances thereto, subject only to the Permitted Exceptions. The legal
description set forth in the Grant Deed shall be as set forth on Exhibit
"A" attached hereto. In the event Purchaser shall obtain a new or updated
survey of the Land and Improvements and the legal description set forth in
Purchaser's survey shall differ from the legal description set forth on
Exhibit "A" hereto, Seller shall execute and deliver to Purchaser a
quitclaim deed containing a legal description based upon such survey
obtained by Purchaser;
(b) Xxxx of Sale. A Xxxx of Sale conveying to Purchaser marketable title
------------
to the Personal Property in the form attached hereto as Exhibit " F ";
---
(c) Blanket Transfer. A Blanket Transfer and Assignment in the form
----------------
attached hereto as Exhibit " G ";
---
(d) Assignment and Assumption of Lease. An Assignment and Assumption of
----------------------------------
Lease in the form attached hereto as Exhibit " H " assigning to Purchaser
---
all of Seller's right, title, and interest in and to the Lease and the
rents thereunder;
(e) ALTA Affidavit. A customary ALTA affidavit in the form required by
--------------
the Title Company;
13
(f) FIRPTA Certificate. A FIRPTA Certificate;
------------------
(g) Surveys and Plans. Such surveys, site plans, plans and
-----------------
specifications, and other matters relating to the Property as are described
in subparagraph (a) of the Blanket Transfer and Assignment and are in the
possession of Seller or Seller's agents;
(h) Certificates of Occupancy. To the extent in Seller's possession, the
-------------------------
original certificates of occupancy for all space within the Improvements;
(i) Lease. An original executed counterpart or certified copy of the
-----
Lease and all amendments to and modifications thereof;
(j) Estoppel Certificate. The estoppel certificate referred to in
--------------------
Paragraph 9(c) hereof;
(k) Keys and Records. All of the keys to any doors or locks on the
----------------
Property and the original tenant files and other books and records relating
to the Property in Seller's possession;
(l) Tenant Notice. Notice from Seller to the Tenant of the sale of the
-------------
Property to Purchaser in such form as Purchaser shall reasonably approve;
and,
(m) Settlement Statement. A settlement statement setting forth the
--------------------
amounts paid by or on behalf of and/or credited to each of Purchaser and
Seller pursuant to this Agreement.
12. Purchaser's Closing Documents. Purchaser shall deliver the balance
-----------------------------
of the Purchase Price and shall obtain or execute and deliver to Seller at
Closing the following documents, all of which shall be duly executed and
acknowledged where required and shall survive the Closing:
(a) Blanket Transfer. The Blanket Transfer and Assignment;
----------------
(b) Assignment and Assumption of Lease. The Assignment and Assumption of
----------------------------------
Lease; and
(c) Settlement Statement. A settlement statement setting forth the
--------------------
amounts paid by or on behalf of and/or credited to each of Purchaser and
Seller pursuant to this Agreement.
14
13. Closing Costs. Seller shall pay the cost of the Title Report, the
-------------
portion of the premium for the ALTA Owner's Policy of Title Insurance issued
pursuant thereto, the cost of the as-built survey, the cost of any recording
fees, grantor, documentary or transfer tax imposed by the State of California,
Orange County and local transfer taxes, if any, upon the conveyance of the
Property pursuant hereto, the attorneys' fees of Seller, and all other costs and
expenses incurred by Seller in closing and consummating the purchase and sale of
the Property pursuant hereto. Purchaser shall pay for that portion of the
premium for the ALTA Owner's Policy of Title Insurance attributed to any
coverage in excess of the CLTA coverage, the cost of any title insurance
endorsements, its attorneys' fees and all other costs and expenses incurred by
Purchaser in closing and consummating the purchase and sale of the Property
pursuant hereto. The parties shall each pay one-half of any escrow fees.
14. Prorations. The following items shall be prorated and/or credited
----------
between Seller and Purchaser as of Midnight preceding the date of Closing:
(a) Rent. Rent, additional rents, operating costs, and other income of
----
the Property (other than security deposits) collected by Seller from Tenant
for the month of Closing. Seller shall pay to Purchaser at Closing any
rents or other sums prepaid by Tenant for any period following the month of
Closing. The parties shall adjust after Closing for any uncollected rent or
other income under the Lease that shall become due and payable upon final
reconciliation of any pass-through items under the Lease. Seller further
reserves the right to collect (without any right to pursue the right of
possession against the Tenant under the Lease) any delinquent rents or
other sums payable under the Lease as of the Closing.
(b) Property Taxes. Except for such taxes which are the responsibility
--------------
of Tenant and for which Seller has not received payment, City, state,
county, and school district ad valorem taxes based on the ad valorem tax
bills for the Property, if then available, or if not, then on the basis of
the latest available tax figures and information. Should such proration be
based on such latest available tax figures and information and prove to be
inaccurate upon receipt of the ad valorem tax bills for the Property for
the year of Closing, either Seller or Purchaser, as the case may be, may
demand at any time after Closing a payment from the other correcting such
malapportionment. In addition, if after Closing there is an adjustment or
reassessment by any governmental authority with respect to, or affecting,
any ad valorem taxes for the Property for the year of Closing or any prior
year, any additional tax payment or refund for the Property required to be
paid or refunded with respect to the year of
15
Closing shall be prorated between Purchaser and Seller and any such
additional tax payment or refund for the Property for any year prior to the
year of Closing shall be paid by or to Seller, as the case may be. This
agreement shall expressly survive the Closing.
(c) Utility Charges. Except for utilities which are the responsibility
---------------
of Tenant and for which Seller has not received payment, Seller shall pay
all utility bills received prior to Closing and shall be responsible for
utilities furnished to the Property prior to Closing. Purchaser shall be
responsible for the payment of all bills for utilities furnished to the
Property subsequent to the Closing. Seller and Purchaser hereby agree to
prorate and pay their respective shares of all utility bills received
subsequent to Closing, which agreement shall survive Closing.
15. PURCHASER'S DEFAULT. IN THE EVENT OF DEFAULT BY PURCHASER UNDER THE
-------------------
TERMS OF THIS AGREEMENT, SELLER'S SOLE AND EXCLUSIVE REMEDY SHALL BE TO RECEIVE
THE XXXXXXX MONEY AS LIQUIDATED DAMAGES AND THEREAFTER THE PARTIES HERETO SHALL
HAVE NO FURTHER RIGHTS OR OBLIGATIONS HEREUNDER WHATSOEVER. IT IS HEREBY AGREED
THAT SELLER'S DAMAGES WILL BE DIFFICULT TO ASCERTAIN AND THAT THE XXXXXXX MONEY
CONSTITUTES A REASONABLE LIQUIDATION THEREOF AND IS INTENDED NOT AS A PENALTY,
BUT AS FULLY LIQUIDATED DAMAGES. SELLER AGREES THAT IN THE EVENT OF DEFAULT BY
PURCHASER, IT SHALL NOT INITIATE ANY PROCEEDING TO RECOVER DAMAGES FROM
PURCHASER, BUT SHALL LIMIT ITS RECOVERY TO THE RETENTION OF THE XXXXXXX MONEY.
_________________________
Seller's Initials
_________________________
Purchaser's Initials
16. Seller's Default. In the event of default by Seller under the terms
----------------
of this Agreement, except as otherwise specifically set forth herein, at
Purchaser's option: (i) Purchaser may terminate this Agreement by written notice
to Seller, whereupon the Xxxxxxx Money shall be immediately returned by Escrow
Agent to Purchaser, and the parties hereto shall have no further rights or
obligations hereunder whatsoever, or (ii) Purchaser shall be entitled to an
immediate refund of the Xxxxxxx Money and to pursue the remedy of specific
performance as its sole and exclusive remedies.
17. Condemnation. If, prior to the Closing, all or any part of the
------------
Property valued at more than $100,000 is subjected to a bona fide threat of
condemnation by a body having the power of eminent domain or is taken by eminent
domain or condemnation (or sale in lieu thereof), or if Seller has received
notice that any
16
condemnation action or proceeding with respect to the Property is contemplated
by a body having the power of eminent domain, Seller shall give Purchaser
immediate written notice of such threatened or contemplated condemnation or of
such taking or sale, and Purchaser may by written notice to Seller given within
thirty (30) days of the receipt of such notice from Seller, elect to cancel this
Agreement. If Purchaser chooses to cancel this Agreement in accordance with this
Paragraph 17, then the Xxxxxxx Money shall be returned immediately to Purchaser
by Escrow Agent and except as otherwise provided herein, the rights, duties,
obligations, and liabilities of the parties hereunder shall immediately
terminate and be of no further force and effect. If Purchaser does not elect to
cancel this Agreement in accordance herewith or the portion of the Property in
question is valued at less than $100,000, this Agreement shall remain in full
force and effect and the sale of the Property contemplated by this Agreement,
less any interest taken by eminent domain or condemnation, or sale in lieu
thereof, shall be effected with no further adjustment and without reduction of
the Purchase Price, and at the Closing, Seller shall assign, transfer, and set
over to Purchaser all of the right, title, and interest of Seller in and to any
awards that have been or that may thereafter be made for such taking.
18. Damage or Destruction. If any of the Improvements shall be destroyed
---------------------
or damaged prior to the Closing, and the estimated cost of repair or replacement
exceeds One Hundred Thousand Dollars ($100,000) or if the Lease shall terminate
as a result of such damage, Purchaser may, by written notice given to Seller
within ten (10) days after receipt of written notice from Seller of such damage
or destruction, elect to terminate this Agreement, in which event the Xxxxxxx
Money shall immediately be returned by Escrow Agent to Purchaser and except as
expressly provided herein to the contrary, the rights, duties, obligations, and
liabilities of all parties hereunder shall immediately terminate and be of no
further force or effect. If Purchaser does not elect to terminate this Agreement
pursuant to this Paragraph 18, or has no right to terminate this Agreement
(because the damage or destruction does not exceed $100,000 and the Lease
remains in full force and effect), and the sale of the Property is consummated,
Purchaser shall be entitled to receive all insurance proceeds paid or payable to
Seller by reason of such destruction or damage under the insurance required to
be maintained by Seller pursuant to Paragraph 9(d) hereof (less amounts of
insurance theretofore received and applied by Seller to restoration) and Seller
shall pay to Purchaser the amount of any deductible thereunder. If the amount of
said casualty or rent loss insurance proceeds is not settled by the date of
Closing, Seller shall execute at Closing all proofs of loss, assignments of
claim, and other similar instruments to ensure that Purchaser shall receive all
of Seller's right, title, and interest in and under said insurance proceeds.
17
19. Hazardous Substances. Seller has not received any notice (a) of any
--------------------
"hazardous substances" (as defined in Comprehensive Environmental Response,
Compensation and Liability Act of 1980, 42 U.S.C. Sections 9601 et seq. as
------
amended) at the Property; (b) that there has been any release or threat of
release of any such hazardous substance; (c) that the Property is subject to
regulation by any governmental entity as result of the presence of (A) stored,
leaked or spilled petroleum products,(B) underground storage tanks, (C) an
accumulation of rubbish, debris or other solid waste, or because of the
presence, release, threat of release, discharge, storage, treatment, generation
or disposal of any "hazardous waste" (as defined in the Resource Conservation
and Recovery Act, 42 U.S.C. Section 6901 et seq., as amended), or "toxic
------
substance" (as defined in the Toxic Substance Control Act, 15 U.S.C. Section
2601 et seq., as amended), including without limitation asbestos and items or
------
equipment containing polychlorinated biphenyls ( PCBs ) in excess of 50 parts
per million; and (d) that any environmental condition exists on the Property
that either (X) requires the owner of the Property to report such condition to
any authority or agency of the State of Illinois or (Y) requires the owner of
the Property to make a notation of such condition in any public records or
conveyancing instrument upon the conveyance of the Property. Seller covenants
during the period of this Agreement not to discharge or store any such materials
on the Property.
20. Assignment. Purchaser's rights and duties under this Agreement shall
----------
be freely transferable and assignable by Purchaser to an affiliate of Purchaser,
and, subject to Seller's prior written consent, not to be unreasonably withheld,
to any third party, either in full or in part, but in the event of any such
transfer or assignment, Purchaser shall remain liable for the performance of all
obligations, covenants, conditions, and agreements imposed upon Purchaser
pursuant to the terms of this Agreement.
21. Broker's Commission. Seller has by separate agreement agreed to pay
-------------------
a real estate commission to Xxxxxx -Xxxxxxx Commercial Real Estate Services (the
"Broker"). Purchaser and Seller hereby represent each to the other that they
have not discussed this Agreement or the subject matter hereof with any real
estate broker or agent other than Broker so as to create any legal right in any
such broker or agent to claim a real estate commission with respect to the
conveyance of the Property contemplated by this Agreement. Seller shall and does
hereby indemnify and hold harmless Purchaser from and against any claim, whether
or not meritorious, for any real estate sales commission, finder's fees, or like
compensation in connection with the sale contemplated hereby and arising out of
any act or agreement of Seller. Likewise, Purchaser shall and does hereby
indemnify and hold harmless Seller from and against any claim, whether or not
meritorious, for any real estate sales commission, finder's fees,
18
or like compensation in connection with the sale contemplated hereby and arising
out of any act or agreement of Purchaser, except any such claim asserted by
Broker, The Xxxxxx Company or any broker or agent claiming under Broker. The
parties acknowledge that The Xxxxxx Company has participated in this transaction
and will be paid a portion of the commission due Broker. This Paragraph 21 shall
survive the Closing or any termination of this Agreement.
22. Notices. Wherever any notice or other communication is required or
-------
permitted hereunder, such notice or other communication shall be in writing and
shall be delivered by overnight courier, by hand, or sent by U.S. registered or
certified mail, return receipt requested, postage prepaid, to the addresses set
out below or at such other addresses as are specified by written notice
delivered in accordance herewith:
PURCHASER: c/x Xxxxx Capital, Inc.
0000 Xxxxxxx Xxxxxx Xxxx
Xxxxxxxx, Xxxxxxx 00000
Attn: Xx. Xxx X. Xxxxx, III
with a copy to: X'Xxxxxxxxx & Xxxxx
0000 Xxxxxxx Xxxxxx Xxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxx 00000
Attn: Xxxxxxx X. X'Xxxxxxxxx, Xx., Esq.
SELLER: Magellan Property Corporation
0000 X. Xxxxxxxxx Xxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
Attention: Xxxxx X. Xxxxx, President
With copies to Xxxxx X. Xxxxxxxxxxx
with a copy to: Allen, Matkins, Lock, Xxxxxx
and Xxxxxxx LLP
00000 Xxx Xxxxxx, 0xx Xxxxx
Xxxxxx, Xxxxxxxxxx 00000-0000
Attn: Xxxxxxx Xxxxx, Esq.
Any notice or other communication given as hereinabove provided shall be deemed
effectively given or received on the date of delivery.
23. Possession. Possession of the Property shall be granted by Seller to
----------
Purchaser on the date of Closing, subject only to the Leases and the Permitted
Exceptions.
24. Time Periods. If the time period by which any right, option, or
------------
election provided under this Agreement must be exercised, or by which any act
required hereunder must be
19
performed, or by which the Closing must be held, expires on a Saturday, Sunday,
or holiday, then such time period shall be automatically extended through the
close of business on the next regularly scheduled business day in Dallas, Texas.
25. Survival of Provisions. All covenants, warranties, and agreements
----------------------
set forth in this Agreement shall survive the execution or delivery of any and
all deeds and other documents at any time executed or delivered under, pursuant
to, or by reason of this Agreement, and shall survive the payment of all monies
made under, pursuant to, or by reason of this Agreement, for a period of 36
months following Closing.
26. Severability. This Agreement is intended to be performed in
------------
accordance with, and only to the extent permitted by, all applicable laws,
ordinances, rules, and regulations. If any provision of this Agreement, or the
application thereof to any person or circumstance, shall, for any reason and to
any extent be invalid or unenforceable, the remainder of this Agreement and the
application of such provision to other persons or circumstances shall not be
affected thereby but rather shall be enforced to the greatest extent permitted
by law.
27. Authorization. Purchaser represents to Seller that this Agreement
-------------
has been duly authorized and executed on behalf of Purchaser and constitutes the
valid and binding agreement of Purchaser, enforceable in accordance with its
terms, and all necessary action on the part of Purchaser to authorize the
transactions herein contemplated has been taken, and no further action is
necessary for such purpose.
28. General Provisions. No failure of either party to exercise any power
------------------
given hereunder or to insist upon strict compliance with any obligation
specified herein, and no custom or practice at variance with the terms hereof,
shall constitute a waiver of either party's right to demand exact compliance
with the terms hereof. This Agreement contains the entire agreement of the
parties hereto, and no representations, inducements, promises, or agreements,
oral or otherwise, between the parties not embodied herein shall be of any force
or effect. Any amendment to this Agreement shall not be binding upon the parties
hereto unless such amendment is in writing and executed by all parties hereto.
Subject to the provisions of paragraph 20, the provisions of this Agreement
shall inure to the benefit of and be binding upon the parties hereto and their
respective heirs, legal representatives, successors, and assigns. Time is of the
essence of this Agreement. This Agreement may be executed in multiple
counterparts, each of which shall constitute an original, but all of which taken
together shall constitute one and the same agreement. The headings inserted at
the beginning of each paragraph are for convenience only, and do not add to or
subtract from the meaning of the contents of each paragraph. This
20
Agreement shall be construed and interpreted under the laws of the State of
California. Except as otherwise provided herein, all rights, powers, and
privileges conferred hereunder upon the parties shall be cumulative but not
restrictive to those given by law. All personal pronouns used in this Agreement,
whether used in the masculine, feminine, or neuter gender shall include all
genders, and all references herein to the singular shall include the plural and
vice versa.
29. Effective Date. The "Effective Date" of this Agreement shall be
--------------
deemed to be the date this Agreement is fully executed by both Purchaser and
Seller and a fully executed original counterpart of this Agreement has been
received by both Purchaser and Seller. If the Effective Date does not occur on
or before December 17, 1996, this Agreement shall be void and of no further
force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and their respective seals to be affixed hereunto as of the day,
month and year first above written.
"SELLER":
Magellan Bake Parkway Limited
Partnership, an Arizona
limited partnership
By: Magellan Bake Parkway I, L.L.C., an
Arizona limited liability company,
its general partner
By: Magellan Management Corporation,
an Arizona corporation, its manager
By: /s/ Xxxxx X. Xxxxx
--------------------------------
Xxxxx X. Xxxxx
Secretary/Treasurer
"PURCHASER":
XXXXX PARTNERS, L.P.
a Georgia limited partnership
By: Xxxxx Capital, Inc.
Its: General Partner
By: /s/ Xxx X. Xxxxx, III
--------------------------------
Xxx X. Xxxxx, III
President
21
