PURCHASE AND SALE AGREEMENT
Between
CORPORATE REALTY INCOME FUND I, L.P.
(Seller)
and
FSP 0000 XXXXXXXXX XXXXX LIMITED PARTNERSHIP
(Purchaser)
Property: 0000 Xxxxxxxxx Xxxxx
Xxxxxx, Xxxxx
Dated as of September 7, 2004
PURCHASE AND SALE AGREEMENT
This Purchase and Sale Agreement ("Agreement") is made as of
September 7, 2004 (the "Effective Date") by and between CORPORATE REALTY INCOME
FUND I, L.P., a Delaware limited partnership ("Seller") and FSP 0000 XXXXXXXXX
XXXXX LIMITED PARTNERSHIP, a Texas limited partnership ("Purchaser").
A. Seller owns in fee simple a certain parcel of real property
located in the City of Irving, County of Dallas, State of Texas, commonly
referred to as 0000 Xxxxxxxxx Xxxxx (hereinafter collectively referred to as the
"Real Property").
B. Subject to the terms and conditions herein, Seller desires to
sell and Purchaser desires to purchase the Real Property and certain items of
personal property.
NOW THEREFORE, in consideration of the mutual covenants contained
herein, Seller and Purchaser agree as follows:
1. PURCHASE AND SALE
1.1 Property.
Subject to the terms and conditions hereof, Seller hereby agrees to
sell, convey and assign to Purchaser, and Purchaser hereby agrees to purchase
and accept from Seller on the Closing Date (as defined in Section 4.1 below) the
following (collectively, the "Property"):
(a) the Real Property, which is legally described on Exhibit A
attached hereto, together with any and all rights, privileges
and easements appurtenant thereto, which are owned by Seller;
(b) all buildings located on the Real Property, and all other
improvements and fixtures located on the Real Property which are
owned by Seller, if any, including any apparatus, equipment and
appliances incorporated therein and used in connection with the
operation and occupancy thereof, such as heating and air
conditioning systems and facilities used to provide any utility
service, ventilation, or other services thereto, but excluding
fixtures owned by tenants (all of which are collectively
referred to as the "Improvements");
(c) all right, title and interest of Seller in and to any personal
property located on and used in connection with the Real
Property and Improvements, including without limitation the
personal property listed on Schedule 1 (the "Personal
Property");
(d) all assignable or transferable intangible property, including,
but not limited to: (i) all guaranties and warranties (including
guaranties and
warranties pertaining to construction of the Improvements); (ii)
all air rights, excess floor area rights and other development
rights relating or appurtenant to the Real Property or the
Improvements; (iii) all rights to obtain utility service in
connection with the Improvements and the Real Property; (iv) all
assignable licenses and other governmental permits and
permissions relating to the Real Property, the Improvements or
the operation thereof, including without limitation the licenses
and permits listed on Schedule 2 (the "Permits"); and (v) all
assignable contracts and contract rights relating to the Real
Property or the Improvements, including the contracts listed on
Exhibit H (the "Service Contracts"), which shall survive the
Closing (all of the foregoing are hereinafter collectively
referred to as the "Intangible Property"); and
(e) All right, title and interest of Seller in and to the leases
and other occupancy agreements covering all or any portion of
the Real Property or the Improvements to the extent they are in
effect on the date of Closing (collectively the "Leases"),
together with all current rents and other sums due thereunder
(the "Rents") and any and all security deposits in connection
therewith (the "Security Deposits"). The Leases, in each case
together with the current monthly rent and Security Deposit
relative thereto, are set forth on Exhibit L (the "Rent Roll").
2. PURCHASE PRICE
Purchaser shall pay as the total Purchase Price for the Property
("Purchase Price") the amount of Sixteen Million One Hundred Thousand and
No/100ths U.S. Dollars ($16,100,000.00), which shall be payable as follows:
2.1 Deposit.
Within three (3) Business Days following the Effective Date, Purchaser
shall cause One Hundred Sixty-One Thousand and No/100ths U.S. Dollars
($161,000.00) (the "Downpayment") to be delivered by wire transfer to Escrow
Holder (as hereinafter defined) to be held by the Escrow Holder in accordance
with the terms and conditions of this Agreement. The Downpayment shall be held
in an interest bearing account or instrument, as approved by Purchaser, as an
xxxxxxx money deposit toward the Purchase Price. Purchaser will provide Escrow
Holder with its Taxpayer Identification Number and such additional information
and documents as may be required by Escrow Holder.
The Escrow Holder shall be subject to the following terms and conditions
and no others:
(a) The duties and obligations of the Escrow Holder shall be
determined solely by the express provisions of this Agreement
and no implied duties and obligations shall be read into this
Agreement against the Escrow Holder.
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(b) The Escrow Holder shall be entitled to rely, and shall not be
subject to any liability in acting in reliance, upon any joint
writing furnished to the Escrow Holder by Purchaser and Seller
and shall be entitled to treat as genuine the document it
purports to be, including any such letter, paper or other
document furnished to the Escrow Holder in connection with this
Agreement.
(c) In the event of any disagreement between Purchaser and Seller
resulting in adverse claims and demands being made in connection
with or against the funds held in the escrow created hereby, the
Escrow Holder shall refuse to comply with the claims and demands
of either party until such disagreement is finally resolved,
either by Purchaser and Seller, as evidenced by a joint writing
reflective thereof delivered to the Escrow Holder pursuant to
subparagraph (b) above, or by a court of competent jurisdiction
(in proceedings which the Escrow Holder or any other party may
initiate, it being understood and agreed by Purchaser and Seller
that the Escrow Holder has the authority (but no obligation) to
initiate such proceedings).
(d) In the event of a termination of this Agreement by either
Seller or Purchaser as permitted by the terms of this Agreement,
the Escrow Holder is authorized and directed by Seller and
Purchaser to deliver the Deposit (as hereinafter defined) to the
party hereto entitled to same pursuant to the terms hereof no
sooner than the fifth Business Day and no later than the tenth
Business Day following receipt by the Escrow Holder and the
non-terminating party of written notice of termination delivered
in accordance with Section 10 of this Agreement from the
terminating party and receipt of evidence satisfactory to the
Escrow Holder that the non-terminating party has in fact
received written notice of such termination in accordance with
Section 10 of this Agreement.
2.2 Interest.
Except as provided in Section 2.1 above and in other provisions of this
Agreement where Seller shall be entitled to retain the Downpayment and all
interest earned thereon (collectively, the "Deposit") as liquidated damages
pursuant to Section 12 below, interest on the Downpayment shall accrue to the
benefit of Purchaser.
2.3 Cash at Closing.
The Purchase Price, adjusted for the Deposit, plus any other amounts
required to be paid by Purchaser at Closing, and plus or minus any prorations
and credits as provided for in this Agreement, in the form of immediately
available U.S. funds, shall be paid by Purchaser into escrow with the Escrow
Holder, as defined in Section 4.1, in time to allow the Closing to occur on the
Closing Date (as hereinafter defined) by wire transfer as more particularly set
forth in Section 4.3 below.
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3. TITLE
3.1 Title Commitment; Survey.
(a) Purchaser acknowledges that prior to the Effective Date Seller
delivered to Purchaser a commitment for title insurance dated as
of August 5, 2004 (the "Title Commitment"), issued by Chicago
Title Insurance Company ("Title Company"), and a copy of all
recorded documents referred to in the Title Commitment as
exceptions to title to the Property (the "Title Documents").
(b) Within 20 days after the Effective Date the Seller, at its
sole cost and expense, will deliver to Purchaser a current
survey of the Real Property and Improvements (the "Survey")
prepared in accordance with the Minimum Standard Detail
Requirements and Classifications for ALTA/ACSM Land Title
Surveys published in 1999, including Table A items 1-4, 6 -
11(a) and 13-16 and certified to Seller, Purchaser and Title
Company (provided that in lieu of including Table A item 6 on
the Survey, Seller shall have the right to provide Purchaser
with a zoning report from a reputable third party zoning
consultant).
3.2 Review of Title.
Purchaser shall have until 5:00 p.m. Eastern Standard Time on the date
that is fifteen (15) days after delivery of the Title Commitment, Title
Documents and Survey (collectively, "Title Evidence") (the "Title Approval
Date") to review the Title Evidence and render any objections as to matters of
title in writing to Seller. Any matters shown in the Title Evidence not timely
objected to by Purchaser shall be deemed waived and Purchaser shall be deemed to
agree to acquire the Property subject to such exceptions (collectively,
"Permitted Exceptions") hereunder. Seller, in its sole and absolute discretion,
may elect to remove or satisfy any such objections, provided that Seller shall
have fifteen (15) days from the date of such objections to have such objections
that Seller so elects removed or satisfied. Subject to Purchaser's approval,
which may be granted in Purchaser's sole and absolute discretion, Seller may
cause the Title Company to issue a title endorsement or "insure over" any
objection (each, a "Seller Endorsement") and it shall have the same effect as if
such objection was cured by Seller. If Seller shall fail to have such objections
removed, insured over or satisfied within such time or during such time delivers
a written notice to Purchaser that notwithstanding Seller's reasonable efforts,
such objections may not be cured, then, in the absence of a default by
Purchaser, Purchaser may, by written notice to Seller within five (5) days after
the expiration of such time or the delivery of such written notice, either (a)
terminate this Agreement without any liability on its part, in which case the
Deposit shall be refunded to Purchaser, Purchaser shall return all documents,
including all Due Diligence Documents (as hereinafter defined in Section
3.6(d)), received from Seller or Seller's agents to Seller and neither party
shall have any further rights or obligations hereunder (except as set forth in
Sections 3.5(a) and (e), 3.6(b), 9.1, 11.2 and 11.12 hereof), or (b) proceed to
Closing and take title subject to such objections, in which case such non-cured
objections
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shall become Permitted Exceptions hereunder. After the Title Approval
Date and up to and including the Closing Date, Purchaser shall also have the
right to disapprove in writing any additional item not previously set forth in
the Title Report and/or Title Commitment that Title Company intends to show as
an exception to title in the Title Policy. Any such additional item not
specifically disapproved in writing delivered within three (3) Business Days
following Purchaser's receipt of written notice of such additional item shall be
deemed approved. Seller shall have until Closing to remove or cause Title
Company to insure over (subject to Purchaser's approval, which may be granted in
Purchaser's sole and absolute discretion) any such disapproved item at Seller's
own expense. Seller may elect to (a) extend the Closing until the day after the
date upon which Seller is able to remove or cause Title Company to insure over
(subject to Purchaser's approval, which may be granted in Purchaser's sole and
absolute discretion) any such disapproved item (but in no event shall such
extension exceed ten (10) Business Days after the Closing Date), or (b)
terminate this Agreement, unless Purchaser elects to take title subject to such
disapproved item, and, if Seller elects to terminate this Agreement, the Deposit
shall be returned to Purchaser and, thereupon, neither Seller nor Purchaser
shall have any further obligation hereunder (except as set forth under Sections
3.5(a) and (e), 3.6(b), 9.1, 11.2 and 11.12 hereof). Notwithstanding anything in
this Agreement to the contrary, and notwithstanding any approval or consent
given by Purchaser hereunder, Seller shall cause all mortgages and deeds of
trust encumbering Seller's interest in the Real Property, and all mechanic's
liens filed against the Property relating to work performed on the Property and
contracted for by Seller, to be released and reconveyed from the Real Property,
or, with respect to such mechanic's liens, otherwise bonded, on or prior to the
Closing and shall cause the Title Company to insure title to the Real Property
as vested in Purchaser without any exception for such matters. In addition,
Seller shall cure any other monetary liens encumbering Seller's interest in the
Real Property that can be cured solely by payment of funds not to exceed, in the
aggregate, One Hundred Thousand Dollars ($100,000).
3.3 Vesting of Title.
At Closing, Seller shall convey all of Seller's right, title and
interest in and to the Real Property and Improvements to Purchaser by special
warranty deed (as further described in Section 4.2(a)(i) below), subject to the
Permitted Exceptions, and shall convey Seller's interest in the Personal
Property to Purchaser by xxxx of sale (as further described in Section
4.2(a)(ii) below).
3.4 Title Insurance.
At Closing, the Title Company shall issue to Purchaser a Texas Form T-1
Owner Policy of Title Insurance in the amount of the Purchase Price insuring
that title to the Real Property and Improvements is vested in Purchaser subject
only to the Permitted Exceptions (the "Title Policy").
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3.5 Inspection Period.
Purchaser shall have until 5:00 p.m. Eastern Standard Time on the date
that is thirty (30) days after the Effective Date (or such earlier date as
Purchaser may elect in writing to Seller) (the "Inspection Period") to inspect
the Property and the Due Diligence Documents, and to perform such other due
diligence with respect to the Property as Purchaser reasonably deems necessary,
subject to the rights of tenants in possession of the Property. Purchaser agrees
to immediately commence its inspection efforts and will pursue same diligently,
and will advise Purchaser of its findings as soon as practicable. Purchaser may,
on or before the expiration of the Inspection Period (the "Out Date"), in its
sole discretion, advise Seller and Escrow Holder, in writing, of its election to
proceed with the purchase of the Property. If Purchaser, in its sole discretion,
decides that it will not proceed with the purchase of the Property, Purchaser
shall on or before the Out Date give notice to Seller and Escrow Holder that it
is terminating this Agreement. If Purchaser fails to notify Seller and Escrow
Holder of its decision on or before the Out Date, Purchaser shall be deemed to
have notified Seller and Escrow Holder on the Out Date that Purchaser is
terminating this Agreement. Upon any such termination, the Deposit shall be
refunded to Purchaser. In addition, Purchaser shall, at Seller's request, at no
cost to Seller, without representation or warranty, deliver to Seller true and
correct copies of all third party reports obtained by Purchaser with respect to
the Property, and, subject to Sections 3.5(a) and (e), 3.6(b), 9.1, 11.2 and
11.12 hereof, neither party shall have any further rights or obligations
hereunder. In the event this Agreement is not so terminated, the Deposit shall
become non-refundable (subject to the other terms and conditions of this
Agreement) and Seller and Purchaser shall proceed to Closing in accordance with
the terms and conditions hereof and the Inspection Period termination rights
shall be deemed waived by Purchaser. Purchaser shall not undertake any soil
borings, ground water testing or other "Phase 2" investigative procedures
without first having obtained the prior written consent of Seller. Seller has
consented to inspection and testing of the Improvements for asbestos. In
connection with Purchaser's inspection of the Property, Purchaser agrees that:
(a) All inspection fees, engineering fees, or other expenses of
any kind incurred by Purchaser relating to the inspection of the
Property will be at Purchaser's sole cost and expense;
(b) Purchaser will give Seller reasonable advance notice of the
dates of all inspections and will schedule all tests and
inspections during normal business hours whenever feasible
unless otherwise requested by Seller;
(c) Seller will have the right to have one or more representatives
of Seller accompany Purchaser and Purchaser's representatives,
agents or designees while they are on the Property;
(d) Any entry by Purchaser, its representatives, agents or designees
will not unreasonably interfere with Seller's use of the
Property or with the operations of any tenant;
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(e) Purchaser will restore any damage caused to the Property by
Purchaser's entry on the Property for inspection purposes at
Purchaser's sole cost and expense if this transaction does not
close; and
(f) In making any inspection hereunder, Purchaser will treat and
will cause any representative of Purchaser to treat all
information obtained by Purchaser pursuant to the terms of this
Agreement as strictly confidential in accordance with Section
11.12 below.
Purchaser shall have the right to further inspect the Property as provided in
Section 3.6(b) hereafter (during normal business hours and upon notice to
Seller), including for the purpose of confirming that the Property is in the
same condition at Closing as existing at the end of the Inspection Period,
reasonable wear and tear excepted; provided, however, that such continuing right
of inspection shall in no way be deemed to extend or resurrect the Inspection
Period or constitute a condition to Closing, subject however, to the other terms
and conditions of this Agreement. For purposes of this Agreement, the term
"Business Day" shall mean a day other than any Saturday, Sunday, or day upon
which national banks in the City of Dallas, Texas, are not open for general
banking business.
The covenants of Purchaser contained in this Section 3.5(a) and (e)
shall survive the Closing Date or any earlier termination of this Agreement.
3.6 Furnishing of Information.
(a) In furtherance of Purchaser's rights set forth above, Seller has
furnished, or within five (5) days after the Effective Date will
furnish, to Purchaser:
(i) a current rent roll (the "Rent Roll") with respect to
the Property attached as Exhibit L, together with copies
of all Leases and amendments and/or modifications
currently in effect, together with a list pertaining to
the status of rental payments by tenants under the
Leases and any delinquencies in connection therewith;
(ii) a copy of any Phase I Environmental Assessment of the
Property and any other environmental study or report of
the Property prepared for Seller, to the extent same are
in Seller's possession;
(iii) copies of any service, maintenance and other such
contracts relating to the day-to-day operation or
maintenance of the Property listed on Schedule 3,
together with any engineering reports relative to the
Property prepared by third-parties, to the extent such
engineering reports are in Seller's possession;
(iv) copies of financial statements for the Property for the
last two (2) years and year to date 2004 in the form
prepared by or for Seller in the ordinary course of
business with respect to the Property; and
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(v) copies of the current tax xxxx for the Property and
current property tax assessment information in Seller's
possession.
(b) Subject to Section 3.6(c) below, Seller will allow Purchaser and
Purchaser's agents reasonable access to the Property during
regular business hours to inspect the Property during the
Inspection Period and thereafter until the earlier of any
termination of this Agreement and the Closing Date, subject to
the terms of the Leases. Purchaser hereby indemnifies, defends
and holds Seller and the Property harmless from any and all
costs, loss, damages or expenses, of any kind or nature
(including, without limitation, mechanics' liens and reasonable
attorneys' fees and expenses) arising out of or resulting from
such inspection, investigation, entry and/or other activities
upon the Property by Purchaser, its employees, agents,
contractors, subcontractors, and/or assigns. Notwithstanding
anything to the contrary herein, the indemnity set forth in this
Section 3.6(b) shall survive (i) any termination of this
Agreement and (ii) the Closing and shall not be merged therein.
(c) During any period of entry upon the Property prior to Closing,
Purchaser shall maintain, with insurance companies acceptable to
Seller, the following insurance: Worker's Compensation Insurance
as required by law and Employer's Liability Insurance;
Comprehensive General Liability or Commercial General Liability
insurance, with limits of not less than One Million Dollars
($1,000,000) combined single limit and not less than Two Million
Dollars ($2,000,000) on a general aggregate basis, for bodily
injury, death and property damage and Excess (umbrella)
Liability insurance with limits not less than Five Million
Dollars ($5,000,000). Each policy of insurance shall name Seller
and Verizon as additional insureds. Further, each policy of
insurance shall state that such policy is primary and
noncontributing with any insurance carried by Seller or Verizon.
Such policy shall contain a provision that the naming of the
additional insured shall not negate any right the additional
insured would have as a claimant under the policy if not so
named and shall contain severability of interest and
cross-liability clauses. A certificate, together with any
endorsements to the policy required to evidence the coverage
which is to be obtained hereunder, shall be delivered to Seller
prior to the entry onto the Property by Purchaser or its agents.
The certificate shall expressly provide that no less than ten
(10) days prior written notice shall be given Seller in the
event of any material alteration to or cancellation of the
coverages evidenced by said certificate. A renewal certificate
for each of the policies required by this Section 3.6(c) shall
be delivered to Seller not less than ten (10) days prior to the
expiration date of the term of such policy. Any policies
required by the provisions of this Section may be made a part of
a blanket policy of insurance with a "per project, per location
endorsement" so long as such blanket policy contains all of the
provisions required herein and does not reduce the coverage,
impair the
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rights of the other party to this Agreement or negate the
requirements of this Agreement.
(d) In addition to the information to be furnished to Purchaser
under Section 3.6(a) above, Seller shall make available for
Purchaser's inspection, and shall continue to make available
during the Inspection Period and thereafter until the earlier of
any termination of this Agreement and the Closing Date: (i) the
Leases and lease files; (ii) copies of financial statements for
the Property for the last two (2) years and copies of such
historical information in Seller's possession or the possession
of Seller's agents regarding operating expenses of the Property
as Purchaser shall reasonably request; (iii) the documents
listed in Section 3.6(a) above; (iv) guaranties, warranties,
licenses, governmental permits (including Certificates of
Occupancy) and relevant, pertinent reports and agreements in the
possession of Seller or its agents pertaining to the Property,
if any (i.e., engineering reports, environmental reports,
development records and as-built plans and specifications) and
Service Contracts relating to the Property; and (v) such other
documents, materials and information concerning the Property as
Seller may have in its possession or under its control,
excluding only (a) materials that Seller shall have obtained or
developed in connection with the potential sale of the Property,
and (b) materials that are subject to attorney-client privilege
(collectively, the "Due Diligence Documents"), on site at the
Property or at the business office of Seller or its agents or
otherwise. Seller shall reasonably cooperate with Purchaser to
obtain any consents required in connection with an assignment of
any of the Due Diligence Documents. All of the Due Diligence
Documents are confidential and shall not be distributed or
disclosed by Purchaser to any person or entity not associated
with Purchaser in accordance with Section 11.12 hereof. Seller
agrees to deliver to Purchaser a copy of any written notices
which Seller receives prior to Closing from any governmental
authority pertaining to any violation of law or ordinance
regulating the use of the Property which are received by Seller
prior to the Closing Date and of any notice which Seller
receives prior to Closing from any tenant regarding any default
under any Lease. If the transaction fails to close for any
reason whatsoever, Purchaser shall return to Seller all copies
of the Due Diligence Documents which Seller or its agents may
have delivered to Purchaser in accordance with this Section 3.6.
THE FURNISHING OF ANY MATERIALS, DOCUMENTS, REPORTS, OR
AGREEMENTS DESCRIBED ABOVE SHALL NOT BE INTERPRETED IN ANY
MANNER AS A REPRESENTATION OR WARRANTY OF ANY TYPE OR KIND BY
SELLER, ANY PARTNER OF SELLER OR AGENT OF SELLER, OR ANY
OFFICER, DIRECTOR, OR EMPLOYEE OF SELLER, OR ITS AGENTS, OR ANY
OTHER PARTY RELATED IN ANY WAY TO ANY OF THE FOREGOING.
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4. CLOSING
4.1 Closing.
The purchase and sale of the Property ("Closing") shall occur within the
period expiring ten (10) days after the termination of the Inspection Period
except that if such day shall not be a Business Day, the Closing shall occur on
the next Business Day thereafter (the "Closing Date"); provided, however, that
each of Seller and Purchaser shall be entitled to one (1) extension of the
Closing Date for a period not to exceed one (1) day upon prior written notice
thereof to the other party. Seller and Purchaser agree that this transaction
shall close in escrow through Chicago Title Company, which shall serve as escrow
holder hereunder ("Escrow Holder"). In this regard, Seller and Purchaser shall
execute Escrow Holder's standard form general provisions and such other
instructions consistent herewith as Escrow Holder may require and are reasonably
acceptable to Seller and Purchaser. Purchaser and Seller shall endeavor to
conduct a "pre-closing" on the Business Day prior to the Closing Date with title
transfer and payment of the Purchase Price to be completed on the Closing Date
as set forth in Section 4.3 below.
4.2 Transactions at Closing.
One (1) Business Day prior to the Closing Date:
(a) Seller shall deliver or cause to be delivered to Escrow Holder
the following documents (collectively, the "Conveyance
Documents") duly executed and acknowledged where appropriate:
(i) A limited warranty deed (the "Deed") conveying the Real
Property and the Improvements, subject to the Permitted
Exceptions, in the form attached hereto as Exhibit F;
(ii) Xxxx of Sale in the form set forth on Exhibit B attached
hereto, conveying the Personal Property to Purchaser;
(iii) Two counterparts of the Assignment and Assumption
Agreement (the "Assignment") in the form set forth on
Exhibit C attached hereto, conveying all interest of
Seller as landlord in and to the Leases pertaining to
the Real Property and Improvements as more specifically
set forth on Schedule B to the Assignment and Assumption
Agreement; and in and to any equipment leases,
commission agreements and service contracts, as set
forth on Schedules C, D and E, respectively, to the
Assignment and Assumption Agreement;
(iv) Certificate of non-foreign status in the form set forth
on Exhibit D attached hereto, to confirm that Purchaser
is not required to
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withhold part of the Purchase Price pursuant to Section
1445 of the Internal Revenue Code of 1986, as amended;
(v) Original executed copies of all Leases; provided,
however, that the original Leases shall be held at the
Property for delivery to the Purchaser incident to the
Closing;
(vi) Information required by the Title Company to comply with
the real estate reporting requirements set forth in
Section 6045(e) of the Internal Revenue Code of 1986, as
amended;
(vii) Certificate confirming that the representations and
warranties of Seller under this Agreement remain true
and correct in the form attached hereto as Exhibit J;
(viii) Evidence as to the authority of the person or persons
executing documents on behalf of the Seller reasonably
acceptable to Purchaser and the Title Company;
(ix) The Service Contracts which survive Closing, as provided
in Section 9.5 below, together with such leasing and
property files and records pertaining to day-to-day
operation, leasing and maintenance of the Property, to
the extent such files and records are in the possession
of Seller; provided, however, that such documentation
shall be held at the Property for delivery to the
Purchaser incident to the Closing, and provided,
further, that proprietary information of Seller not
relevant to the ownership or operation of the Property
shall not be included. Until the earlier to occur of (i)
the sale of the Property by Purchaser, or (ii) the
expiration of a period of three (3) years after the
Closing, Purchaser shall allow Seller and its agents and
representatives access without charge to all files,
records and documents delivered to Purchaser at the
Closing upon reasonable advance notice and at all
reasonable times, to examine and make copies of any and
all such files, records and documents, which right shall
survive the Closing;
(x) Affidavits as may be customarily and reasonably required
by the Title Company, in form reasonably acceptable to
Seller;
(xi) Closing Statement acceptable to Seller;
(xii) An updated Rent Roll in the same form as set forth as
Exhibit L, certified by Seller as correct and complete
as of the date of delivery thereof;
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(xiii) The Verizon Waiver Notice (defined below), subject,
however, to Section 5.1 below; and
Such other documents as may be reasonably necessary and appropriate to complete
the Closing of the transaction contemplated herein.
(b) Purchaser shall deliver to Escrow Holder the following:
(i) The Purchase Price as adjusted in Section 2.3 above, and
as further adjusted to reflect the Purchaser's share of
closing costs, and any fees as more particularly set
forth in Section 4.3 below;
(ii) Two counterparts of a duly executed and acknowledged
Assignment (as described in Section 4.2(a)(iii) above);
(iii) Information required by the Title Company to comply with
the real estate reporting requirements set forth in
Section 6045(i) of the Internal Revenue Code of 1986, as
amended;
(iv) Evidence of the authority of the person or persons
executing documents on behalf of Purchaser reasonably
acceptable to Seller and the Title Company;
(v) Certificate confirming that the representations and
warranties of Purchaser under this Agreement remain true
and correct in the form attached hereto as Exhibit K;
(vi) Closing Statement acceptable to Purchaser;
(vii) Affidavits as may be customarily and reasonably required
by the Title Company, in form reasonably acceptable to
Purchaser; and
(viii) Such other documents as may be reasonably necessary and
appropriate to complete the Closing of the transaction
contemplated herein.
(c) Seller and Purchaser shall execute a tenant notification letter
to all tenants under the Leases (the "Tenant Notification
Letter") in the form attached hereto as Exhibit G, and Purchaser
shall, within forty-eight (48) hours following the Closing,
cause the Tenant Notification Letter to be delivered to such
tenants.
4.3 Title Transfer and Payment of Purchase Price.
(a) Purchaser agrees to deliver the cash payment specified in
Section 4.2(b)(i) above by wiring the same to the Escrow Holder
so that the wire may be confirmed in time to allow Closing to
occur on the Closing Date and directing the Escrow Holder to
deposit or wire the same into Seller's
12
designated account(s) upon the recording and delivery, as
applicable, by the Title Company of the documents to be executed
and delivered by Seller under Sections 4.2(a) above or upon
issuance by the Title Company of, or unconditional agreement by
the Title Company to issue, the Title Policy.
(b) Upon receipt of all items specified in Section 4.2 and following
the satisfaction or waiver of all conditions precedent to
Closing and upon Title Company issuing or committing to issue
the Title Policy, Escrow Holder shall take the following
actions:
(i) Prorate any and all amounts to be prorated pursuant to
Sections 5.1 and 5.2 below;
(ii) Date and cause to be recorded the Deed as of Closing and
designate that the Deed be returned directly to
Purchaser after recordation;
(iii) Issue the Title Policy to Purchaser;
(iv) Deliver the Deposit and the balance of the Purchase
Price to Seller, plus or minus appropriate adjustments
and retaining, if required under Section 5.1(e), the
Holdback (defined below);
(v) Credit Purchaser with the total of any and all tenant
security deposits called for in the Leases and any and
all prorated rents and other items;
(vi) Deliver properly executed copies of the Closing
Statement to Seller and to Purchaser, which Closing
Statement shall have been approved by Seller and
Purchaser prior to Closing;
(vii) Deliver to Seller a copy of the Deed as recorded and
executed originals of all documents delivered by
Purchaser to Escrow Holder pursuant to Section 4.2(b)
above;
(viii) Deliver to Purchaser executed originals of all documents
delivered by Seller to Escrow Holder pursuant to Section
4.2(a) above, other than that set forth in Section
4.2(a)(i) above; and
(ix) Pay any broker's commissions as provided herein.
4.4 Reporting Requirements.
The Escrow Holder shall comply with all applicable federal, state and local
reporting requirements relating to the closing of the transactions contemplated
herein. Without limiting the generality of the foregoing, to the extent the
transactions contemplated by this Agreement involve a real estate transaction
within the purview of Section 6045 of the
13
Internal Revenue Code of 1986, as amended (the "Internal Revenue Code"), Escrow
Holder shall have sole responsibility to comply with the requirements of Section
6045 of the Internal Revenue Code (and any similar requirements imposed by state
or local law). Escrow Holder shall hold Purchaser, Seller and their respective
counsel free and harmless from and against any and all liability, claims,
demands, damages and costs, including reasonable attorneys' fees and other
litigation expenses, arising or resulting from the failure of Escrow Holder to
comply with such reporting requirements.
5. PRORATIONS; CLOSING ITEMS
5.1 Prorations; Closing Costs; Holdback.
(a) The amount due on any gas, electric, water, sewer, or other
utility xxxx, or service contract relating to the Property shall
be prorated between Seller and Purchaser as of the Closing Date,
to the extent such utilities or service contracts are the
obligation of the Seller and not a direct or indirect obligation
of a tenant under any of the Leases. Any utility deposits made
by Seller shall be and remain the property of Seller.
(b) All collected rents and other payments from each tenant under
the Leases, including, but not limited to, base rent, additional
rent, percentage rent (if any), and expense reimbursements,
shall be prorated between Seller and Purchaser as of the Closing
Date. The balance remaining from any security deposits or
prepaid rent under the Leases held by Seller shall be credited
to Purchaser (including the balance of estimated tax, insurance
and common area maintenance payments made to Seller by tenants
under the Leases net of any payments by Seller thereon).
Purchaser agrees to indemnify and hold harmless Seller from and
against any loss, cost or expense (including, but not limited
to, attorneys' fees and expenses) resulting from any claim for
such deposits or prepaid rent actually paid or credited to
Purchaser. If any rent or other payments under the Leases are in
arrears as of the Closing Date ("Delinquent Rents"), the amount
of any such Delinquent Rents which are collected by Purchaser
shall be promptly paid by Purchaser to Seller after Closing.
Purchaser shall be entitled to deduct from any such payment (i)
Purchaser's reasonable costs of collection incurred with respect
to such Delinquent Rents (including attorneys' fees), (ii) rents
due for the month in which such payment is received by
Purchaser, and (iii) rents from such tenant attributable to any
period after the Closing that are past due on the date of
receipt. Purchaser agrees to use commercially reasonable efforts
to collect Delinquent Rents after the Closing provided Purchaser
shall not be required to bring any action or proceeding against
any tenant on account of Delinquent Rents. Purchaser's
obligations hereunder with respect to the collection and payment
of Delinquent Rents shall survive the Closing. Seller may make
reasonable efforts to collect Delinquent Rents from and after
the Closing Date; provided, however, that Seller shall not be
entitled to pursue any
14
action for eviction of any tenant from the Property. The
provisions of this Section shall survive Closing and shall not
be merged therein.
(c) All real estate taxes payable in respect of the Property for the
calendar year 2004 shall be prorated as of the Closing;
provided, Seller shall be entitled to recover any reimbursements
from the tenants on account of such taxes for the period prior
to Closing, and Purchaser shall immediately remit to Seller any
such reimbursements received by Purchaser upon receipt thereof.
Any real estate taxes due and payable for any periods subsequent
to the calendar year 2004 shall be the obligation of Purchaser
and any real estate taxes due and payable for any periods prior
to calendar year 2004 shall be the obligation of Seller,
provided Purchaser shall cooperate with Seller to obtain any
reimbursement from any tenant in respect of any such taxes.
Seller and Purchaser agree to mutually cooperate with each other
in connection with ongoing tax reduction proceedings relating to
prior tax years, if any, and any ongoing or future proceedings
relating to the year in which the Closing occurs, if any, and
any refund resulting therefrom (to the extent not refundable to
tenants under the Leases) shall be prorated between Seller and
Purchaser based on the Closing Date, after deducting therefrom
the reasonable out-of-pocket expenses incurred by the parties.
The provisions of the immediately preceding two sentences shall
survive Closing and shall not be merged therein.
(d) Purchaser shall pay for the cost of recording the Deed and the
premium for any endorsements (other than Seller Endorsements)
and special or extended coverages of any nature in connection
with the Title Policy, one-half (1/2) of any escrow and closing
fees charged by Escrow Holder, any taxes payable on the transfer
of the Personal Property, and any lender's title insurance
coverage on account of any other loan obtained by Purchaser.
Purchaser shall pay for all costs relating to any financing
obtained by Purchaser in connection with its purchase of the
Property, including any and all costs incurred by Purchaser in
performing any tests and investigations. Seller shall pay for
the cost of the base premium for the Title Policy and the cost
of any Seller Endorsements (but not the cost of any endorsements
or special or extended coverages other than the Seller
Endorsements), one-half (1/2) of any escrow and closing fees
charged by Escrow Holder, the cost of the Survey, any prepayment
or reconveyance fee in connection with any payoff or release of
any existing deed of trust or mortgage, and the recording fees
with respect to documents which Seller elects to place of record
in order to cure title objections raised by Purchaser to the
extent Seller elects to cure the same, as fully described in
Section 3.2. Each party shall pay its own attorneys' fees.
(e) Both Seller and Seller's broker have indicated to Purchaser that
they believe Verizon Directories Corp., a Delaware corporation
("Verizon"), the existing and sole tenant of the Property, will
not elect to terminate the
15
Verizon Lease (defined below) earlier than the stated term
thereof, pursuant to its right to do so as set forth in Section
5d of the Verizon Lease. Purchaser would not purchase the
Property at any price if Purchaser believed there was a high
probability that Verizon would exercise its early termination
right under the Verizon Lease. To give Purchaser an incentive to
purchase the Property, Seller has agreed to put in escrow $2.5
million dollars to be held in favor of the Purchaser to help
lessen the negative economic impact on the Purchaser if Verizon
does exercise its early termination option. Unless Verizon has
waived in writing ("Verizon Waiver Notice") its early
termination rights under Section 5(d) of that certain Lease (as
amended, the "Verizon Lease") dated as of April 20, 1994,
between Seller, as landlord, and GTE Directories Corporation
(Verizon's predecessor), as tenant, and Seller has delivered the
Verizon Waiver Notice as provided for in Section 4.2(a)(xiii) of
this Agreement, at Closing, Escrow Holder shall withhold from
the proceeds otherwise payable to Seller the sum of Two Million
Five Hundred Thousand and No/100 Dollars ($2,500,000.00)
(together with any interest accrued thereon, the "Holdback").
The Holdback shall be held by Escrow Holder in an interest
bearing account or instrument as reasonably approved by Seller
and Purchaser ("Holdback Escrow").
The Holdback shall be delivered to Purchaser if Purchaser
delivers, on or before April 30, 2005, written notice to Escrow
Holder, with a copy to Seller (such deliveries to be in
accordance with the provisions of Section 10 of this Agreement),
that Verizon has exercised its early termination rights,
together with a copy of Verizon's notice of termination
("Verizon Termination Notice"), and Seller agrees that if
Verizon gives Purchaser such Verizon Termination Notice, the
validity of such Verizon Termination Notice shall be judged
under the terms of the Verizon Lease at the sole determination
of Purchaser, and Seller further agrees that under no
circumstances shall Seller contest or prevent that release. The
Holdback shall be delivered to Seller if Purchaser does not
deliver, on or before April 30, 2005, a Verizon Termination
Notice to Escrow Holder, with a copy to Seller (delivered in
accordance with the provisions of Section 10 of this Agreement).
If the Holdback has been delivered to Purchaser pursuant to the
foregoing paragraph, then, not earlier than January 1, 2006, nor
later than January 15, 2006, Purchaser shall deliver to Seller
(such delivery to be in accordance with the provisions of
Section 10 of this Agreement) a certificate stating (i) whether
(a) Verizon vacated (or was in the process of vacating) the
Property pursuant to the Verizon Termination Notice before
January 15, 2006, and (b) Verizon ceased paying rent under the
Verizon Lease as of January 15, 2006, and (ii) if Verizon did
not vacate or was in the process of vacating the Property prior
to January 15, 2006, the circumstances and/or the terms and
conditions of Verizon's continued occupancy of the Property. If
Verizon does not vacate the Property on or
16
before January 31, 2006, and is continuing in occupancy for any
period thereafter, then Purchaser shall repay to Seller a pro
rata portion of the Holdback calculated as follows: the total
new base rent paid by Verizon (and/or the base rent recovered on
account of Verizon's failure to pay base rent under the current
Verizon Lease, less costs) for the period of January 1, 2006 up
to December 31, 2007 divided by the total base rent to be paid
under the current Verizon lease times the Holdback. In addition,
if Purchaser sells, assigns or otherwise transfers the Property
prior to January 15, 2006, or if Purchaser sells, assigns or
otherwise transfers the Property after January 15, 2006, but
prior to such payment (if applicable), Purchaser shall place in
escrow with Escrow Holder (or such other escrow agent as may be
acceptable to the parties), pursuant to an escrow agreement
between and among, and acceptable to, Seller, Purchaser and the
escrow agent, the sum of Two Million Five Hundred Dollars
($2,500,000), and any reimbursement due to Seller under this
Section 5.1(e) shall be paid from such escrow, with the balance
thereof returned to Purchaser.
5.2 Calculation of Prorations.
For purposes of calculating prorations, Seller shall be deemed to be in
title to the Property, and therefore entitled to the income therefrom and
responsible for the expenses thereof, through the day prior to the Closing Date
and Purchaser shall be deemed to be in title to the Property, and therefore
entitled to the income therefrom and responsible for the expenses thereof, from
and after 12:01 a.m. on the Closing Date. All prorations shall be made on the
basis of the actual number of days of the year and month which have elapsed as
of the Closing Date. All prorations which cannot be ascertained as of the
Closing shall be prorated on the basis of the parties' reasonable estimate of
such amount. Except as otherwise stated above, if necessary, the amount of
prorations shall be adjusted in cash after Closing, as and when complete and
accurate information becomes available but in any event no later than ninety
(90) days after the Closing Date; provided, however, the ninety (90) day period
shall be extended for a reasonable time for any real property tax reduction or
abatement proceeds, which are to be prorated between Purchaser and Seller
pursuant to Section 5.1(c), and for any period of time which may be required for
reconciliation of tax, insurance, and common area maintenance expenses for the
calendar year in which the Closing Date occurs. Purchaser and Seller each agree
to reasonably cooperate with the other with respect to such final proration.
This provision shall survive Closing and shall not be merged therein.
6. REPRESENTATIONS AND WARRANTIES
6.1 Seller's Representations and Warranties.
Seller hereby represents and warrants to Purchaser as follows:
(a) Seller's Entity. Seller is a Delaware limited partnership duly
organized, validly existing and in good standing under the laws
of the State of
17
Delaware. Seller has qualified as a foreign limited partnership
in the state in which the Property is located, and the execution
and performance of this Agreement will not violate any term of
its limited partnership certificate or agreement, or any
judicial decree, statute or regulation by which it may be bound
or affected.
(b) Seller's Authority. Seller has full power and authority to enter
into this Agreement and to perform all its obligations
hereunder, and has taken all action required by law, its
governing instruments, or otherwise to authorize the execution,
delivery and performance of this Agreement and all the deeds,
agreements, certificates, and other documents contemplated
herein, and this Agreement has been duly executed by and is a
valid and binding agreement of Seller, enforceable in accordance
with its terms, except as enforceability may be limited by
equitable principles or by the laws of bankruptcy, insolvency,
or other laws affecting creditors' rights generally.
(c) No Conflict or Lien. To the best of Seller's knowledge, neither
the execution or delivery of this Agreement nor the consummation
of the transactions contemplated herein will conflict with or
result in a breach of any contract, license or undertaking to
which Seller is a party or by which any of its property is
bound, or constitute a default thereunder or, except as
contemplated herein, result in the creation of any lien or
encumbrance upon the Property.
(d) No Proceedings. No legal or administrative proceeding is (i)
pending or to the best of Seller's knowledge threatened against
the Property or (ii) pending or to the best of Seller's
knowledge threatened against Seller which would materially
adversely affect the Property or Seller's right to convey the
Property to Purchaser as contemplated in this Agreement. Seller
shall have the right to, and shall promptly, update the
representation set forth herein to reflect any proceeding that
first becomes pending after the Effective Date, or of which
Seller first acquires knowledge after the Effective Date.
(e) Leases. Seller has delivered to Purchaser a correct and complete
copy of each of the Leases and any amendments thereto. The
information regarding the Leases contained on the Rent Roll
attached as Exhibit L, which identifies all tenants of the
Property as of the Effective Date, is correct and complete as of
the date of this Agreement. To the knowledge of Seller, each of
the Leases is in full force and effect, no notice has been given
of any cancellation or surrender thereof, and neither Seller nor
the tenant is in default thereunder.
(f) Violations. Seller has no knowledge of and has not received
written notice from any governmental body, authority or agency
of any violation of federal, state or local laws, ordinances,
codes, rules or regulations
18
affecting the Property, including any notice with respect to any
Hazardous Materials (as hereinafter defined) or of any violation
of any insurance requirements relative to the Property, any
matters identified in which have not been corrected. Seller
shall have the right to, and shall promptly, update the
representation set forth herein to reflect any notice of which
Seller first acquires knowledge after the Effective Date.
(g) Condemnation. Seller has no knowledge of and has received no
written notice of any pending or threatened condemnation
proceedings relating to the Property. Seller shall have the
right to, and shall promptly, update the representation set
forth herein to reflect any proceeding that first becomes
pending after the Effective Date, or of which Seller first
acquires knowledge after the Effective Date.
(h) Commissions. No leasing commissions are due and payable with
respect to the existing terms of the Leases except as set forth
on the Rent Roll described in Section 3.6(a)(i) hereof;
provided, however, that nothing contained in this Section 6.1(h)
shall be construed in any way to modify the obligations with
respect to leasing commissions and tenant improvements described
in Sections 9.2 and 9.3 hereof.
(i) Service Contracts. All material Service Contracts affecting the
Property are accurately set forth on Exhibit H hereto. To the
best of its knowledge, Seller is not in default under any of the
Service Contracts.
Except with respect to the warranties set forth in Section 6.1 hereof,
Seller has not made any warranty or representation, express or implied, written
or oral, concerning the Property, including without limitation any
representations relating to Hazardous Materials (as defined in Section 6.3(c)
below).
All representations and warranties of Seller contained herein are
intended to and shall remain true and correct as of the Closing and shall
survive the delivery of the Deed for a period of six (6) months after Closing
and shall thereafter expire unless a claim thereunder has been commenced in
compliance with the next sentence and diligently pursued thereafter. Any claims
by Purchaser with respect to such representations or warranties shall be
commenced by written notice to Seller within said six (6) month period and shall
be diligently pursued thereafter or shall be deemed waived by Purchaser.
Notwithstanding the foregoing, Purchaser shall have no claim against Seller with
respect to the representations and warranties set forth in this Section 6.1 if
Purchaser had actual knowledge that a representation or warranty was untrue or
inaccurate or incorrect as of the time of Closing and Purchaser nevertheless
chose to proceed with Closing hereunder.
Whenever in this Agreement a representation of Seller is based on the
"Seller's knowledge" or words of similar import, such reference shall be deemed
to be to the actual knowledge of Xxxxxx X. Xxxxxxx, Xx., without investigation
or inquiry of any kind. There shall be no personal liability to said individual
arising out of said representations or
19
warranties. No knowledge of parties affiliated with, employed by, or related by
agency to Seller shall be imputed to Seller or to the above-named person.
Notwithstanding anything to the contrary contained in this Agreement,
the aggregate amount which may be collected by Purchaser pursuant to the
representations and warranties of Seller set forth herein shall not exceed
$200,000.
6.2 Purchaser's Representations and Warranties.
Purchaser represents, warrants, and covenants to Seller that:
(a) Authority to Execute; Organization. This Agreement constitutes
the valid and binding obligation of Purchaser and is enforceable
against Purchaser in accordance with its terms, except as
enforceability may be limited by equitable principles or by the
laws of bankruptcy, insolvency, or other laws affecting
creditors' rights generally. Purchaser is a corporation validly
organized and in good standing under the laws of the state of
its organization, and the execution of this Agreement, delivery
of money and all required documents, Purchaser's performance of
this Agreement and the transaction contemplated hereby have been
duly authorized by the requisite action on the part of the
Purchaser and Purchaser's directors, shareholders, partners,
members or trustees.
(b) Recording. Purchaser shall not record this Agreement or a
memorandum hereof at any time.
(c) Litigation. There is no litigation pending or, to Purchaser's
knowledge, threatened, against Purchaser or any basis therefore
before any court, regulatory authority or administrative agency
that would likely result in any material adverse change in the
business or financial condition of the Purchaser.
(d) Financial Condition. Purchaser has adequate financial resources
to make timely payment of all sums due from Purchaser hereunder
and to perform all of its obligations hereunder.
(e) Purchaser Experience. Purchaser (or Purchaser's general partner
or the shareholders thereof) is experienced in contracting for
and investigating the suitability of real property similar to
the Property for the acquisition thereof for investment purposes
and is represented or has had an opportunity to be represented
by counsel in connection with this transaction. Purchaser has
the responsibility under this Agreement to inspect the Property
and the real estate market in sufficient detail to fully satisfy
itself with respect to the environmental conditions and the
market conditions affecting the Property including, without
limitation, property values, interest rates, and similar market
factors. Purchaser has reached its
20
conclusions based upon its own analysis and without relying upon
representations by Seller, its employees, agents or consultants.
Terrorist Organizations. Purchaser is not acting, directly or
indirectly, for or on behalf of any person, group, entity or
nation named by the United States Treasury Department as a
Specifically Designated National and Blocked person, or for or
on behalf of any person, group, entity or nation designated in
Presidential Executive Order 13224 as a person who commits,
threatens to commit, or supports terrorism; and it is not
engaged in this transaction directly or (to Purchaser's
knowledge) indirectly on behalf of, or facilitating this
transaction directly or indirectly on behalf of, any such
person, group, entity or nation.
6.3 Purchaser Accepts Property "As Is".
(a) Purchaser Acknowledgment. As of the expiration of the Inspection
Period, Purchaser acknowledges for Purchaser and Purchaser's
successors, heirs and assignees, (i) that Purchaser has been
given full opportunity to inspect and investigate the Property,
all improvements thereon and all aspects relating thereto,
either independently or through agents and experts of
Purchaser's choosing, (ii) that Purchaser is acquiring the
Property based solely upon Purchaser's own investigation and
inspection thereof and Seller's representations and warranties
set forth in Section 6.1(a) through (i) hereof inclusive, and
(iii) that the provisions of this Section 6.3(a) shall survive
Closing and shall not be merged therein. SELLER AND PURCHASER
AGREE THAT UPON CLOSING THE PROPERTY SHALL BE SOLD AND THAT
PURCHASER SHALL ACCEPT POSSESSION OF THE PROPERTY ON THE CLOSING
DATE "AS IS, WHERE IS, WITH ALL FAULTS" WITH NO RIGHT OF SET-OFF
OR REDUCTION IN THE PURCHASE PRICE, AND THAT EXCEPT FOR THE
REPRESENTATIONS AND WARRANTIES OF SELLER SET FORTH IN SECTION
6.1(a) THROUGH (i) HEREOF INCLUSIVE, SUCH SALE SHALL BE WITHOUT
REPRESENTATION OR WARRANTY OF ANY KIND, EXPRESS OR IMPLIED,
INCLUDING WITHOUT LIMITATION, WARRANTY OF INCOME POTENTIAL,
OPERATING EXPENSES, USES, MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE, AND SELLER DOES HEREBY DISCLAIM AND RENOUNCE
ANY SUCH REPRESENTATION OR WARRANTY. PURCHASER SPECIFICALLY
ACKNOWLEDGES THAT PURCHASER IS NOT RELYING ON ANY
REPRESENTATIONS OR WARRANTIES OF ANY KIND WHATSOEVER, EXPRESS OR
IMPLIED, FROM SELLER, SELLER'S AGENTS OR BROKERS, AS TO ANY
MATTER CONCERNING THE PROPERTY (EXCEPT FOR THE WARRANTIES
SPECIFICALLY SET FORTH IN SECTION 6.1(a) THROUGH (i) HEREOF
INCLUSIVE), INCLUDING WITHOUT LIMITATION: (l) THE CONDITION OR
SAFETY OF THE PROPERTY OR ANY IMPROVEMENTS
21
THEREON, INCLUDING, BUT NOT LIMITED TO, PLUMBING, SEWER, HEATING
AND ELECTRICAL SYSTEMS, ROOFING, AIR CONDITIONING, IF ANY,
FOUNDATIONS, SOIL AND GEOLOGY INCLUDING HAZARDOUS MATERIALS (AS
HEREINAFTER DEFINED), LOT SIZE, OR SUITABILITY OF THE PROPERTY
OR ITS IMPROVEMENTS FOR A PARTICULAR PURPOSE; (2) WHETHER THE
APPLIANCES, IF ANY, PLUMBING OR UTILITIES ARE IN WORKING ORDER;
(3) THE HABITABILITY OR SUITABILITY FOR OCCUPANCY OF ANY
STRUCTURE AND THE QUALITY OF ITS CONSTRUCTION; (4) THE FITNESS
OF ANY PERSONAL PROPERTY; OR (5) WHETHER THE IMPROVEMENTS ARE
STRUCTURALLY SOUND, IN GOOD CONDITION, OR IN COMPLIANCE WITH
APPLICABLE CITY, COUNTY, STATE OR FEDERAL STATUTES, CODES OR
ORDINANCES, INCLUDING, WITHOUT LIMITATION THE REQUIREMENTS OF
THE AMERICANS WITH DISABILITIES ACT, 42 USCA Section 12101 et.
seq. SUBJECT ONLY TO THE WARRANTIES EXPRESSLY SET FORTH IN
SECTIONS 6.1(a) THROUGH (i) HEREOF, PURCHASER FURTHER
ACKNOWLEDGES AND AGREES THAT IT IS RELYING SOLELY UPON ITS OWN
INSPECTION OF THE PROPERTY AND NOT UPON ANY REPRESENTATIONS MADE
TO IT BY SELLER, ITS OFFICERS, DIRECTORS, CONTRACTORS, AGENTS OR
EMPLOYEES OR ANY PERSON WHOMSOEVER. ANY REPORTS, REPAIRS OR WORK
REQUIRED BY PURCHASER ARE TO BE THE SOLE RESPONSIBILITY OF
PURCHASER AND PURCHASER AGREES THAT THERE IS NO OBLIGATION ON
THE PART OF SELLER TO MAKE ANY CHANGES, ALTERATIONS, OR REPAIR
TO THE PROPERTY AND PURCHASER ACKNOWLEDGES THAT, IN THE EVENT
THAT PURCHASER ELECTS TO PROCEED TO CLOSING PRIOR TO THE
EXPIRATION OF THE INSPECTION PERIOD AS PROVIDED IN THIS
AGREEMENT, PURCHASER WILL HAVE COMPLETED ITS DUE DILIGENCE WITH
RESPECT TO THE PROPERTY TO ITS SATISFACTION.
(b) No Claim for Hazardous Materials. Upon Closing, Purchaser, for
Purchaser and Purchaser's successors in interest, releases
Seller from, and waives all claims and liability which Purchaser
may have against Seller for, any structural, physical and
environmental condition of the Property, including without
limitation the presence, discovery or removal of any Hazardous
Materials in, at, about or under the Property, or for, connected
with or arising out of any and all claims or causes of action
based upon the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980 ("CERCLA"), the
Superfund Amendments and Reauthorization Act of 1986 ("XXXX"),
the Resource Conservation and Recovery Act ("RCRA"), the Toxic
Substances Control Act (the "TSCA"), as such acts may be amended
from time to time, or any other
22
federal or state statutory or regulatory cause of action arising
from or related to Hazardous Materials at, in or under the
Property (collectively, the "Hazardous Waste Laws"). The waiver
and release of Purchaser set forth in this Section 6.3(b) shall
survive the Closing Date and shall be enforceable at any time
after the Closing Date.
(c) "Hazardous Materials" Defined. For purposes of this Agreement,
the term "Hazardous Material" shall mean any substance,
chemical, waste or material that is or becomes regulated by any
federal, state or local governmental authority because of its
toxicity, infectiousness, radioactivity, explosiveness,
ignitability, corrosiveness or reactivity, including, without
limitation, those substances regulated by the Hazardous Waste
Laws.
(d) No Representations as to Hazardous Materials. Purchaser
acknowledges that Seller has made no representations or
warranties whatsoever to Purchaser regarding the presence or
absence of any Hazardous Materials in, at, or under the
Property; provided, however, that Seller and Purchaser
acknowledge that Seller has made certain representations as to
no proceedings, notices received, knowledge or otherwise as more
specifically set forth in Sections 6.1 (d), (f) and (g) hereof.
Purchaser has made such studies and investigations, conducted
such tests and surveys, and engaged such specialists as
Purchaser has deemed appropriate to evaluate fairly the Property
and its risks from an environmental and Hazardous Materials
standpoint.
7. CONDITIONS TO CLOSING
7.1 Seller's Conditions.
The obligation of Seller to sell and convey the Property under this
Agreement is subject to the satisfaction of the following conditions precedent
or conditions concurrent (the satisfaction of which may be waived only in
writing by Seller):
(a) Delivery and execution by Purchaser to Escrow Holder of all
monies, items, and other instruments required to be delivered by
Purchaser to Escrow Holder;
(b) Purchaser's covenants, warranties, and representations set forth
herein shall be true and correct as of the Closing Date;
(c) All of the actions by Purchaser contemplated by this Agreement
shall have been completed; and
(d) There shall be no uncured default by Purchaser of any of its
obligations under this Agreement.
23
7.2 Purchaser's Conditions.
The obligation of Purchaser to acquire the Property under this Agreement
is subject to the satisfaction of the following conditions precedent or
conditions concurrent:
(a) Delivery of Purchaser's notice to proceed, as provided in
Section 3.5;
(b) Delivery and execution by Seller to Escrow Holder of all monies,
items and other instruments to be delivered by Seller to Escrow
Holder, provided, however, that the original Leases and Service
Contracts which survive Closing, and the leasing and property
files and records pertaining to day-to-day operation, leasing
and maintenance of the Property, to the extent same are in the
possession of Seller, shall be held at the Property for delivery
to the Purchaser incident to Closing;
(c) Seller's covenants, warranties and representations set forth
herein shall be true and correct as of the Closing Date;
(d) All of the actions by Seller contemplated by this Agreement
shall have been completed;
(e) There shall be no uncured default by Seller of any of its
obligations under this Agreement;
(f) Purchaser shall have received, on or before five (5) days before
the Closing Date, the Tenant Estoppel Certificate, as set forth
in Section 15;
(g) Purchaser shall have received, on or before five (5) days before
the Closing Date, the Declaration Estoppel, as set forth in
Section 16; and
(h) Title Company shall be irrevocably committed to issue the Title
Policy subject to the Permitted Exceptions.
7.3 Failure of Condition.
(a) In the event of a failure of any condition contained in Section
7.1 or 7.2 above which is not the result of a default by either
party, the party for whose benefit the condition existed may
either waive the condition and proceed to Closing or may
terminate this Agreement in which event the Deposit and all
documents and funds deposited by Purchaser shall be immediately
returned to Purchaser, all documents deposited by Seller shall
be immediately returned to Seller, and neither party shall have
any further rights or obligations hereunder (except as set forth
in Sections 3.5(a) and (e), 3.6(b), 9.1, 11.2 and 11.12);
(b) In the event of a failure of any condition contained in Section
7.2 above due to a default by Seller, then Purchaser may in its
sole discretion:
24
(i) terminate this Agreement in which event the Deposit and
all documents and funds deposited by Purchaser shall be
immediately returned to Purchaser, all documents
deposited by Seller shall be immediately returned to
Seller, and neither party shall have any further rights
or obligations hereunder (except as set forth in
Sections 3.5(a) and (e), 3.6(b), 9.1, 11.2 and 11.12);
(ii) pursue specific performance of Seller's obligation to
convey the Property to Purchaser in accordance with the
terms of this Agreement; or
(iii) waive such default and close the transaction.
(c) In the event of a failure of any condition contained in Section
7.1 above due to a default by Purchaser, Seller may in its sole
discretion:
(i) terminate this Agreement and Seller shall retain as
liquidated damages the Deposit, as described in Article
12, in which event all documents deposited by Purchaser
shall be immediately returned to Purchaser, and all
documents deposited by Seller shall be immediately
returned to Seller, copies of all third party reports
obtained by Purchaser shall be delivered to Seller in
accordance with Section 3.5, and neither party shall
have any further rights or obligations hereunder (except
as set forth in Sections 3.5(a) and (e), 3.6(b), 9.1,
11.2 and 11.12); or
(ii) Seller may waive such default and close the transaction.
(d) Seller waives any rights it may have to specific performance in
the event of a default by Purchaser with the exclusive remedy of
Seller being the right to liquidated damages more fully
described in Section 12 hereof. Purchaser waives any right to
any claim of any nature for damages or otherwise in the event of
a default by Seller and Purchaser acknowledges that its
exclusive remedies in the event of a default by Seller shall be
to either terminate this Agreement in accordance with Section
7.3(b)(i) above, to seek specific performance in accordance with
Section 7.3(b)(ii) above, or waive such default and close the
transaction in accordance with Section 7.3(b)(iii) above.
8. DAMAGE OR DESTRUCTION OF THE PROPERTY; CONDEMNATION
8.1 Damage or Destruction of the Property.
(a) If, between the Effective Date and the Closing Date, the
Property is Materially Damaged or Destroyed (as hereinafter
defined), Purchaser may elect in writing, within ten (10)
business days after receipt of notice by Purchaser from Seller
of such damage or destruction (the "Casualty Notice
25
Date"), accompanied by information regarding the amount and
payment of insurance, to terminate this Agreement or to purchase
all of the Property without regard to such damage or
destruction. If Purchaser fails to notify Seller of Purchaser's
election, Purchaser will be deemed to have elected not to
proceed with the purchase of all of the Property. In the event
that Purchaser purchases the Property, Seller shall have no
obligation to repair any such damage or destruction, nor shall
the Purchase Price be adjusted except as provided in 8.1(b)
below. "Materially Damaged or Destroyed" shall mean damage or
destruction the repair or replacement of which either would not
be permitted due to the then effective requirements of any
applicable law, ordinance, rule or regulation of any
governmental or quasi-governmental agency having jurisdiction,
or, as determined by a licensed general contractor having at
least five (5) years experience in the construction of
commercial office buildings, selected by Seller and reasonably
approved by Purchaser, would exceed Three Hundred Fifty Thousand
Dollars ($350,000) as to any casualty of a type against which
insurance is maintained (a "Major Insured Casualty") or would
exceed Two Hundred Thousand Dollars ($200,000) as to any
casualty against which insurance is not maintained (a "Major
Uninsured Casualty"). As used herein, repair or replacement
means such repair or replacement to the Improvements as may be
required to restore the Improvements to a condition having
substantially the same design, specifications and equipment of
the Improvements immediately prior to the casualty. If, between
the Effective Date and the Closing Date, the Property sustains
nonmaterial damage, the parties shall proceed to Closing. If
between the Effective Date and the Closing Date, the Property is
Materially Damaged or Destroyed due to a Major Uninsured
Casualty, Seller may elect in writing, within five (5) days
after the Casualty Notice Date, to terminate this Agreement. If
Seller fails to notify Purchaser of Seller's election, Seller
will be deemed to have elected not to proceed with the sale of
all of the Property.
(b) If Purchaser elects or is required to purchase the Property
despite such damage or destruction, Seller shall assign its
rights to and Purchaser shall be entitled to receive any
insurance proceeds (with any accrued interest thereon) at or
after Closing (as the same are available) and Purchaser shall
receive a credit toward the Purchase Price (i) for the insurance
deductible relative to Seller's insurance on the Property with
respect to an insured casualty, including a Major Insured
Casualty, or (ii) for the cost of repair not covered by
insurance with respect to an uninsured casualty, including a
Major Uninsured Casualty. Seller shall reasonably cooperate with
Purchaser to allow Purchaser to collect any available insurance
proceeds. Seller agrees to maintain until the Closing the level
of insurance coverage in effect on the Property as of the
Effective Date.
(c) If, as a result of any casualty, any determination, election or
agreement required by the terms of this Section 8.1 is not made
by the scheduled
26
Closing Date, the Closing Date shall be extended for an
appropriate time, not to exceed twenty (20) days, after such
determination, election or agreement.
8.2 Condemnation.
If prior to Closing all or any part of the Property is subject to a
proposed taking by any public authority, Seller shall promptly notify Purchaser
in writing of such proposed taking and Purchaser may terminate this Agreement by
notice to Seller within five (5) days after written notice thereof. If Purchaser
so elects, this Agreement shall terminate. If Purchaser does not so elect to
terminate this Agreement, Purchaser shall accept the Property subject to the
taking without a reduction in the Purchase Price and shall receive at Closing an
assignment of all of Seller's rights to any condemnation award to the extent
that such amount does not exceed the Purchase Price plus any legal fees and
expenses actually expended in obtaining such award, with any condemnation award
in excess of such amount to be divided equally between Seller and Purchaser.
Seller shall reasonably cooperate with Purchaser to allow Purchaser to collect
any such award.
9. COMMISSIONS AND EXPENSES
9.1 Payment of the Sale Commission.
Purchaser and Seller represent and warrant to each other that no real
estate broker or agent has been authorized to act on either parties' behalf
except CB Xxxxxxx Xxxxx ("Seller's Agent") under a separate commission agreement
between Seller and Seller's Agent. Seller will pay or cause to be paid to
Seller's Agent, at Closing, the commission payable under such commission
agreement. Purchaser hereby indemnifies Seller and holds Seller harmless from
and against any and all demands or claims which now or hereafter may be asserted
against Seller for any brokerage fees, commissions or similar types of
compensation which may be claimed by any broker which was engaged or which
claims to have been engaged by Purchaser and all expenses and costs in handling
or defending any such demand or claim, including reasonable attorneys' fees.
Seller hereby indemnifies Purchaser and holds Purchaser harmless from and
against any and all demands or claims which now or hereafter may be asserted
against Purchaser for any brokerage fees, commissions or similar types of
compensation which may be claimed by any broker which was engaged or which
claims to have been engaged by Seller and all expenses and costs in handling or
defending any such demand or claim, including reasonable attorneys' fees. This
provision shall survive (i) any termination of this Agreement and (ii) the
Closing and shall not be merged therein.
9.2 Leasing Commissions/Tenant Improvements.
(a) Seller shall pay all leasing commissions or tenant improvement
costs payable under Leases executed prior to the Effective Date
except for commissions and costs payable by reason of any
expansion, extension or renewal of such Leases (to the extent
such expansions, extensions or renewals are pursuant to option
rights expressly set forth in such Leases as
27
of the Effective Date, herein called the "Existing Rights")
occurring on or after the Effective Date, which shall be paid by
Seller and Purchaser as hereinafter provided. Without limiting
the foregoing, Seller shall pay on or before Closing all
commissions with respect to the term through December 31, 2007,
including without limitation, the commission due TAG Realty, and
shall provide evidence of such payment to Purchaser at Closing.
A summary of the business terms of any amendment, renewal or
expansion of an existing Lease (unless such renewal or expansion
is pursuant to and in accordance with the terms of any Existing
Rights, in which case Seller and Purchaser agree that any such
renewal or expansion shall be effective upon the valid exercise
by a tenant pursuant to the terms of any such Existing Rights)
or of any new Lease which Seller wishes to execute between the
Effective Date and the Closing Date will be submitted to
Purchaser prior to execution by Seller. Purchaser agrees to
notify Seller in writing within five (5) Business Days after its
receipt thereof of either its approval or disapproval thereof,
including all leasing commissions, tenant improvement and
inducement payments to be incurred in connection therewith. If
Purchaser informs Seller within such five (5) Business Day
period that Purchaser does not approve the amendment, renewal or
expansion of the existing Lease or the new Lease (a "New Lease
Agreement"), and such notice is given after Purchaser has
delivered the notice to proceed pursuant to Section 3.5 above,
then Seller shall not enter into the proposed New Lease
Agreement. If such notice is given prior to Purchaser's delivery
of the notice to proceed pursuant to Section 3.5 above, Seller
may elect by written notice to the Purchaser prior to the Out
Date (i) not to enter into the proposed New Lease Agreement or
(ii) to proceed with such New Lease Agreement; provided,
however, that in the event that Seller elects to proceed with
such New Lease Agreement and the parties shall thereafter
proceed to Closing, all leasing commissions, tenant improvement
costs, inducement payments, attorneys' fees or other fees
payable incident to the initial tenancy under such New Lease
Agreement shall be paid by Seller. In the event Purchaser fails
to notify Seller in writing of its approval or disapproval of
any New Lease Agreement within the five (5) Business Day period
set forth above, Purchaser shall be deemed to have approved such
New Lease Agreement. All leasing commissions and tenant
improvement costs, inducement payments, attorneys' fees and
other fees paid or expenses incurred with respect to any New
Lease Agreement (regarding which Seller has advised Purchaser in
the requisite summary of business terms delivered to Purchaser
as required above) approved or deemed approved by Purchaser as
set forth above in this Section 9.2(a) shall be the obligation
of Purchaser and Seller, divided pro rata based upon an
allocation determined by the rental income received by Seller
relative to such New Lease Agreement prior to Closing and the
total rental income projected to be paid during the initial term
of such New Lease Agreement.
28
(b) To the extent Seller shall be obligated for any leasing
commissions, tenant improvement costs, inducement payments,
attorneys' fees or other fees payable in connection with any
Lease or New Lease Agreement pursuant to Section 9.2(a) above
for which actual payment thereof has not been made by or on
behalf of Seller on or before the Closing, Purchaser shall
receive a credit at Closing for all such unpaid commissions,
costs, expenses and fees.
9.3 Lease Expense Reimbursement and Assumption.
At Closing, Purchaser shall (i) reimburse Seller for all leasing
commissions, tenant improvement costs, inducement payments, attorneys' fees and
other fees paid or expenses incurred by Seller under any New Lease Agreement
made on or after the Effective Date, if any, which has been approved or deemed
approved by Purchaser pursuant to Section 9.2, less the pro rata share of all
such costs and expenses otherwise payable by Seller pursuant to the last
sentence of Section 9.2(a) above and (ii) assume all obligations of the landlord
under Leases which either (a) arise after Closing or (b) are continuing
covenants of the landlord which apply after Closing, if any.
9.4 Maintenance of the Property; Property Personnel.
Between Seller's execution of this Agreement and the Closing, Seller
shall maintain the Property in its existing condition and repair, reasonable
wear and tear excepted.
9.5 Service Contracts.
Seller shall not, after the date of this Agreement, enter into any
service contract affecting the Property or any amendment thereof, which shall be
an obligation of Purchaser after Closing, or waive, compromise or settle any
rights of Seller under any Service Contract which shall be assumed by Purchaser
upon Closing, or agree to, or modify, amend, or terminate any Service Contract
which shall be assumed by Purchaser upon Closing, without in each case obtaining
Purchaser's prior written consent thereto. Seller shall terminate at or before
Closing those existing Service Contracts that Seller is contractually entitled
to terminate and that Purchaser designates to Seller, on or before the Out Date,
as not to survive Closing.
10. NOTICES
All notices, requests or demands to a party hereunder shall be in
writing and shall be effective (i) when received by overnight courier service or
facsimile telecommunication (provided that a copy of such notice, request or
demand is deposited into the United States mail within one (1) business day of
the facsimile transmission), or (ii) three (3) days after being deposited into
the United States mail (sent certified or registered, return receipt requested),
in each case addressed as follows (or to such other address as Purchaser or
Seller may designate in writing in accordance with this Section 10):
29
If to Seller:
Corporate Realty Income Fund I, L.P.
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxx, Xx.
Phone No.: (000) 000-0000
Fax No.: (000) 000-0000
With a copy to:
Xxxxxx & Xxxxxx
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxx, Esq.
Phone No.: (000) 000-0000
Fax No.: (000) 000-0000
If to Purchaser:
FSP 0000 Xxxxxxxxx Xxxxx Limited Partnership
x/x Xxxxxxxx Xxxxxx Properties Corporation
000 Xxxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxx, XX 00000-0000
Attention: Xxxxxxx X. Xxxxxx
Phone No.: (000) 000-0000
Fax No.: (000) 000-0000
With a copy to:
Xxxxx Peabody LLP
000 Xxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxxx Xxxxxxx, Esq.
Phone No.: (000) 000-0000
Fax No.: (000) 000-0000
If to Escrow Holder:
Chicago Title Insurance Company
000 X. Xxxxx Xxxxxx, 00XX
Xxxxxxx, XX 00000
Phone No.: (000) 000-0000
Fax No.: (000) 000-0000
30
11. MISCELLANEOUS
11.1 Time.
Time is of the essence in the performance of each party's obligations
hereunder.
11.2 Attorneys' Fees.
If any legal action, arbitration or other proceeding is commenced to
enforce or interpret any provision of this Agreement, the prevailing party shall
be entitled to an award of its attorneys' fees and expenses. The phrase
"prevailing party" shall include a party which receives substantially the relief
desired whether by dismissal, summary judgment, judgment or otherwise. This
provision shall survive (i) any termination of this Agreement and (ii) the
Closing and shall not be merged therein.
11.3 No Waiver.
No waiver by any party of the performance or satisfaction of any
covenant or condition shall be valid unless in writing and shall not be
considered to be a waiver by such party of any other covenant or condition
hereunder.
11.4 Entire Agreement.
This Agreement contains the entire agreement between the parties
regarding the Property and supersedes all prior agreements, whether written or
oral, between the parties regarding the same subject. This Agreement may only be
modified in writing.
11.5 Survival.
Except for (i) the representations and indemnity obligations of
Purchaser and Seller under this Agreement, (ii) the post-closing obligations of
Purchaser and Seller under this Agreement and (iii) as otherwise specifically
provided in this Agreement, none of the agreements, warranties and
representations contained herein shall survive Closing.
11.6 Successors.
Subject to Section 11.7, this Agreement shall bind and inure to the
benefit of the parties hereto and to their respective legal representatives,
successors and permitted assigns.
11.7 Assignment.
Purchaser shall be entitled, without Seller's prior consent, to assign
Purchaser's rights in and to this Agreement to an entity controlled by or under
common control with Purchaser (a "Permitted Assignee"). Seller's written consent
shall be required for any other assignment of Purchaser's rights to a nominee
under this Agreement. Any attempted unpermitted assignment, except with Seller's
prior written consent, shall be
31
ineffective and shall constitute a default under this Agreement. Notwithstanding
any assignment hereunder, Purchaser shall remain liable for the obligations of
Purchaser under this Agreement. Purchaser represents, warrants and certifies to
Seller that Purchaser has not assigned, transferred or encumbered or agreed to
assign, transfer or encumber, directly or indirectly, all or any portion of its
rights or obligations under this Agreement. Purchaser shall give written notice
of any proposed assignment at least five (5) Business Days prior to Closing. If
there is an assignment permitted hereunder or if Seller approves such
assignment, Seller shall have no obligation to reissue any estoppels, surveys,
or title commitments previously delivered to Purchaser, nor shall Seller be
responsible for any costs or expenses of any nature associated with such
transfer.
11.8 Relationship of the Parties.
The parties acknowledge that neither party is an agent for the other
party, and that neither party shall or can bind or enter into agreements for the
other party.
11.9 Governing Law.
This Agreement and the legal relations between the parties hereto shall
be governed by and construed in accordance with the laws of the State of New
York.
11.10 Possession; Risk of Loss.
Seller shall deliver to Purchaser possession of the Property on the
Closing Date, subject only to the Leases and Permitted Exceptions. All risk of
loss or damage with respect to the Property shall pass from Seller to Purchaser
upon Closing.
11.11 Review by Counsel.
The parties acknowledge that each party and its counsel have reviewed
and approved this Agreement, and the parties hereby agree that the normal rule
of construction to the effect that any ambiguities are to be resolved against
the drafting party shall not be employed in the interpretation of this Agreement
or any amendments or exhibits hereto.
11.12 Confidentiality.
(a) Seller and Purchaser hereby covenant and agree that, at all
times after the date of execution hereof and prior to the
Closing, unless consented to in writing by the other party, no
press release or other public disclosure concerning this
transaction shall be made, and each party agrees to use best
efforts to prevent disclosure of this transaction, other than
(i) to directors and officers of the parties, limited partners,
members and/or shareholders of Seller, Purchaser or Permitted
Assignee, and employees, prospective lenders of Purchaser or
Permitted Assignee, attorneys, accountants, agents (including
engineers and appraisers) and affiliates of the parties who are
involved in the ordinary course of business with this
32
transaction, all of which shall be instructed to comply with the
confidentiality provisions hereof, or (ii) to institutional
investors and accredited investors, or (iii) as required by law
or in response to lawful process or subpoena or other valid or
enforceable order of a court of competent jurisdiction.
(b) Notwithstanding anything to the contrary contained elsewhere
herein, Purchaser hereby acknowledges that all information
furnished by Seller or its agents (including engineers and
appraisers) or representatives to Purchaser or obtained by
Purchaser in the course of Purchaser's investigation of the
Property, or in any way arising from or relating to any and all
studies or entries upon the Property by Purchaser, its agents or
representatives, shall be treated as confidential information
and further, that if any such confidential information is
disclosed to unpermitted third parties prior to the Closing,
Seller may suffer damages and irreparable harm. In connection
therewith, Purchaser hereby expressly understands, acknowledges
and agrees (i) that Purchaser will not disclose any of the
contents or information contained in or obtained as a result of
any reports or studies made in connection with Purchaser's
investigation of the Property, in any form whatsoever
(including, but not limited to, any oral information received by
Purchaser during the course of Purchaser's inspection of the
Property), to any party prior to the Closing other than (a) the
Seller, Seller's employees, agents or representatives, or
Purchaser's or a Permitted Assignee's agents, employees,
representatives, attorneys, consultants, potential institutional
lenders, institutional investors and accredited investors,
without the prior express written consent of Seller (which
consent shall not be unreasonably withheld) or (b) as required
by law or in response to lawful process or subpoena or other
valid and enforceable order of a court of competent
jurisdiction; (ii) that in making any disclosure of such
information as permitted hereunder, Purchaser will advise said
parties of the confidentiality of such information and the
potential of damage to Seller as a result of any disclosure of
such information by said third party; and (iii) that Seller is
relying on Purchaser's covenant not to disclose any of the
contents or information contained in any such reports or
investigations to unpermitted third parties prior to Closing
(all of which is deemed to be confidential information by the
provisions of this Section). In the event this Agreement is
terminated, Purchaser agrees to return to Seller all
information, studies, or reports Purchaser or Purchaser's agents
have obtained from Seller or Seller's agents, contractors or
representatives with respect to the Property or the condition of
the Property. In the event either Purchaser or Purchaser's
agents, employees, representatives, attorneys, consultants or
potential institutional lenders cause a breach of Purchaser's
duty of confidentiality hereunder, Purchaser shall be liable to
Seller for damages and Seller may pursue all of its remedies
afforded it under this Agreement. This provision
33
shall survive (i) any termination of this Agreement and (ii) the
Closing and shall not be merged therein.
11.13 Termination.
Upon termination of this Agreement for any reason by either party,
Purchaser shall have the obligation to return to Seller all Due Diligence
Documents (including the survey) and any other information or documentation
received by Purchaser from Seller or Seller's agents with respect to the
Property and shall not disclose to any unpermitted third party the contents
thereof. The Escrow Holder shall deliver the Deposit to the party entitled
thereto in accordance with the provisions of this Agreement.
11.14 Waiver of Jury Trial. THE PARTIES HEREBY KNOWINGLY, VOLUNTARILY
AND INTENTIONALLY WAIVE ANY RIGHT THAT EITHER PARTY MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER OR IN
CONNECTION WITH THE PROPERTY, THE CONVEYANCE DOCUMENTS OR ANY OTHER DOCUMENTS
EXECUTED IN CONNECTION HEREWITH, OR IN RESPECT OF ANY COURSE OF CONDUCT,
STATEMENTS (WHETHER ORAL OR WRITTEN), OR ACTIONS OF EITHER PARTY. THIS PROVISION
IS A MATERIAL INDUCEMENT FOR EACH OF THE PARTIES TO ENTER INTO THIS TRANSACTION.
PURCHASER'S INITIALS: _________ SELLER'S INITIALS: _________
11.15 Counterparts.
This Agreement may be executed in one or more counterparts, each of
which will be deemed an original, and the counterparts taken together shall
constitute a single agreement.
11.16 Limitation on Liability. Purchaser expressly agrees that the
obligations and liabilities of Seller under this Agreement and any document
referenced herein shall not constitute personal obligations of the officers,
directors, employees, agents, affiliates, members, representatives, partners,
stockholders or other principals and representatives of Seller. Notwithstanding
anything to the contrary, Seller's liability, if any, arising in connection with
this Agreement or with the Property shall, prior to Closing, be limited to the
remedies as set forth in Section 7.3 of this Agreement and, post-Closing, shall
be limited to $200,000 in accordance with Section 6.1 of this Agreement. The
limitations of liability contained in this section shall apply equally and inure
to the benefit of Seller's present and future officers, directors, affiliates,
members, representatives, trustees, partners, shareholders, agents and
employees, and their respective heirs, successors and assigns.
11.17 Partial Invalidity. If any term or provision of this Agreement
or the application thereof to any person or circumstance shall, to any extent,
be invalid or unenforceable, the remainder of this Agreement, or the application
of such term or
34
provision to persons or circumstances other than those as to which it is held
invalid or unenforceable, shall not be affected thereby, and each such term and
provision of this Agreement shall be valid and be enforced to the fullest extent
permitted by law.
11.18 Construction. Headings at the beginning of each section and
subsection are solely for the convenience of Purchaser and Seller and are not a
part of this Agreement and shall have no effect upon the construction or
interpretation of any part hereof. Whenever required by the context of this
Agreement, the singular shall include the plural and the masculine shall include
the feminine, and vice versa. This Agreement shall not be construed as if it had
been prepared by one of the parties, but rather as if Purchaser and Seller had
prepared the same. Unless otherwise indicated, all references to sections and
subsections are to this Agreement. All Exhibits referred to in this Agreement
are attached hereto and incorporated herein by this reference. In the event the
stated date for Closing or the date on which Purchaser or Seller is required to
take any action under the terms of this Agreement is not a Business Day, the
action shall be taken on the next succeeding Business Day thereafter.
11.19 Audit Letter.
Within ninety (90) days following the Closing Date, Purchaser shall have the
right, at its sole cost and expense, to cause a third party certified public
accounting firm selected by Purchaser to prepare and deliver to Purchaser and
Seller an audit of the historical statements of revenue and direct operating
expenses of the Property for calendar years 2002, 2003 and 2004 through the
Closing Date, and Seller shall provide all information reasonably requested by
such accountants. Thereafter, Seller shall have thirty (30) days in which to
review such audit and, in connection therewith, to deliver to such accountants
an appropriate representation letter prepared in accordance with American
Institute of Certified Public Accountants professional standards, taking into
account Seller's prior accounting practices with respect to the Property.
Purchaser, for itself and its successors and assigns, agrees to and hereby does
indemnify, defend and hold Seller harmless from and against any and all losses,
costs, damages, claims or liabilities, including reasonable attorneys' fees,
arising from, or related to, directly or indirectly, the preparation, delivery
or use by Purchaser or its successors and assigns of Seller's financial
statements.
12. LIQUIDATED DAMAGES
IF PURCHASER SHALL BREACH OR DEFAULT IN ANY OF ITS OBLIGATIONS UNDER
THIS AGREEMENT, SELLER SHALL BE ENTITLED TO TERMINATE THIS AGREEMENT AND RETAIN
THE AMOUNT OF THE DEPOSIT DESCRIBED IN SECTION 2.2 AS LIQUIDATED DAMAGES. SELLER
AND PURCHASER ACKNOWLEDGE THAT SELLER'S DAMAGES WOULD BE DIFFICULT TO DETERMINE,
AND THAT THE DEPOSIT IS A REASONABLE ESTIMATE OF SELLER'S DAMAGES. SELLER AND
PURCHASER SPECIFICALLY FURTHER AGREE AFTER NEGOTIATION THAT THIS SECTION 12 IS
INTENDED TO AND DOES LIQUIDATE THE AMOUNT OF DAMAGES DUE SELLER, AND SHALL BE
SELLER'S EXCLUSIVE REMEDY AGAINST PURCHASER, BOTH AT LAW AND IN EQUITY ARISING
FROM OR RELATED
35
TO A BREACH BY PURCHASER OF ITS OBLIGATION TO CONSUMMATE THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT. THE PROVISIONS OF THIS SECTION 12 SHALL NOT BE
CONSTRUED AS A LIMITATION ON THE OBLIGATIONS OF PURCHASER UNDER SECTIONS 3.5(a)
and (e), 3.6(b), 9.1, 11.2 and 11.12 HEREOF. THIS PROVISION IS A MATERIAL
INDUCEMENT FOR EACH OF THE PARTIES TO ENTER INTO THIS TRANSACTION.
PURCHASER'S INITIALS: _________ SELLER'S INITIALS: _________
13. NO RECORDING
The provisions hereof shall not constitute a lien on the Property and
this Agreement shall not be placed or suffered to be placed by Purchaser for
recording with the office of the recorder (clerk) for the county in which the
Property is located. Purchaser hereby appoints Seller as Purchaser's true and
lawful attorney-in-fact, coupled with an interest, for the purposes of the
execution of such documents and doing such acts as shall be necessary to effect
the discharge of the recording of this Agreement if such recording shall have
been accomplished in violation of this Section.
14. EFFECTIVENESS
This Agreement shall only be effective if a counterpart is signed by
both Seller and Purchaser.
15. TENANT ESTOPPEL CERTIFICATE
Seller shall make commercially reasonable efforts to deliver to
Purchaser, at least five (5) days prior to the Closing Date, an original,
executed tenant estoppel certificate from Verizon, in substantially the form
attached hereto as Exhibit I or otherwise containing the information required to
be contained in Verizon's tenant estoppel certificate pursuant to the Verizon
Lease ("Tenant Estoppel Certificate").
16. DECLARATION ESTOPPEL CERTIFICATE
Seller shall make commercially reasonable efforts to deliver to
Purchaser, at least five (5) days prior to the Closing Date, an original,
executed estoppel certificate from Las Colinas Association ("Association"),
addressed to Purchaser, Purchaser's lender and Seller, stating the annual
assessment amount payable to the Association with respect to the Property, the
period covered by such assessment, any unpaid amount owed to the Association
with respect to the Property, and any outstanding defaults relating to the
Property under the applicable declaration of covenants, conditions and
restrictions ("Declaration Estoppel").
36
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first set forth above.
SELLER:
CORPORATE REALTY INCOME FUND I, L.P.
By: /s/ Xxxxxx X. Xxxxxxx, Xx.
--------------------------
Xxxxxx X. Xxxxxxx, Xx.
General Partner
By: 1345 Realty Corporation,
General Partner
By: /s/ Xxxxxx X. Xxxxxxx, Xx.
--------------------------
Xxxxxx X. Xxxxxxx, Xx.
President
37
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first set forth above.
PURCHASER:
FSP 0000 XXXXXXXXX XXXXX LIMITED
PARTNERSHIP, a Texas limited partnership
By: FSP 0000 XXXXXXXXX XXXXX LLC,
its general partner
By: /s/ Xxxxxx X. Xxxxxx
--------------------
Xxxxxx X. Xxxxxx, its President
38
ESCROW HOLDER:
Chicago Title Insurance Company
By : Xxxxx Xxxxxx
------------
Its: Escrow Officer
--------------
39
TABLE OF CONTENTS
1. PURCHASE AND SALE.....................................................1
1.1 Property.......................................................
2. PURCHASE PRICE........................................................2
2.1 Deposit.......................................................2
2.2 Interest......................................................3
2.3 Cash at Closing...............................................3
3. TITLE.................................................................4
3.1 Title Commitment; Survey......................................4
3.2 Review of Title...............................................4
3.3 Vesting of Title..............................................5
3.4 Title Insurance...............................................5
3.5 Inspection Period.............................................6
3.6 Furnishing of Information.....................................7
4. CLOSING..............................................................10
4.1 Closing......................................................10
4.2 Transactions at Closing......................................10
4.3 Title Transfer and Payment of Purchase Price.................12
4.4 Reporting Requirements.......................................13
5. PRORATIONS; CLOSING ITEMS............................................14
5.1 Prorations; Closing Costs; Reserve Accounts..................14
5.2 Calculation of Prorations....................................17
i
6. REPRESENTATIONS AND WARRANTIES.......................................17
6.1 Seller's Representations and Warranties......................17
6.2 Purchaser's Representations and Warranties...................20
6.3 Purchaser Accepts Property "As Is"...........................21
7. CONDITIONS TO CLOSING................................................23
7.1 Seller's Conditions..........................................23
7.2 Purchaser's Conditions.......................................24
7.3 Failure of Condition.........................................24
8. DAMAGE OR DESTRUCTION OF THE PROPERTY; CONDEMNATION..................25
8.1 Damage or Destruction of the Property........................25
8.2 Condemnation.................................................27
9. COMMISSIONS AND EXPENSES.............................................27
9.1 Payment of the Sale Commission...............................27
9.2 Leasing Commissions/Tenant Improvements......................27
9.3 Lease Expense Reimbursement and Assumption...................29
9.4 Maintenance of the Property; Property Personnel..............29
9.5 Service Contracts............................................29
10. NOTICES..............................................................29
11. MISCELLANEOUS........................................................31
11.1 Time.........................................................31
11.2 Attorneys' Fees..............................................31
11.3 No Waiver....................................................31
11.4 Entire Agreement.............................................31
11.5 Survival.....................................................31
ii
11.6 Successors...................................................31
11.7 Assignment...................................................31
11.8 Relationship of the Parties..................................32
11.9 Governing Law................................................32
11.10 Possession; Risk of Loss.....................................32
11.11 Review by Counsel............................................32
11.12 Confidentiality..............................................32
11.13 Termination..................................................34
11.14 Waiver of Jury Trial.........................................34
11.15 Counterparts.................................................34
11.16 Limitation on Liability......................................34
11.17 Partial Invalidity...........................................35
11.18 Construction.................................................35
12. LIQUIDATED DAMAGES...................................................35
13. NO RECORDING.........................................................36
14. EFFECTIVENESS........................................................36
15. TENANT ESTOPPEL CERTIFICATE..........................................36
EXHIBIT A - Legal Description
EXHIBIT B - Xxxx of Sale
EXHIBIT C - Assignment and Assumption Agreement
EXHIBIT D - Seller's Affidavit
EXHIBIT E - [Intentionally omitted]
EXHIBIT F - Form of Special Warranty Deed
EXHIBIT G - Tenant Notification Letter
EXHIBIT H - Service Contracts
EXHIBIT I - Tenant Estoppel Certificate
EXHIBIT J - Form of Seller's Recertification of Representations and
Warranties
EXHIBIT K - Form of Purchaser's Recertification of Representations and
Warranties
EXHIBIT L - Rent Roll
SCHEDULE 1 - Personal Property
SCHEDULE 2 - Permits
SCHEDULE 3 - Service and Other Contracts
iii
EXHIBIT A
LEGAL DESCRIPTION OF THE PROPERTY
BEING all of Walnut Hill Business Park Fourth Installment, an Addition to the
City of Irving, Dallas County, Texas, according to the Map thereof recorded in
Volume 79068, Page 1713 of the Map Records of Dallas County, Texas and being
more particularly described as follows:
BEGINNING at a 1/2 inch iron rod found for corner at the intersection of the
West right-of-way line of Execution Drive (60' R.O.W.) and the South
right-of-way line of Greenway Drive (60' R.O.W.);
THENCE South 00 degrees 06 minutes 20 seconds West along the West right-of-way
line of Executive Drive, a distance of 725.00 feet to a 1/2 inch iron rod found
for corner at the intersection of the West line of said North right-of-way line
of Corporate Drive (60' R.O.W.);
THENCE North 89 degrees 53 minutes 40 seconds West along the North right-of-way
line of Corporate Drive, a distance of 400.00 feet to a 1/2 inch iron rod found
for corner;
THENCE North 00 degrees 06 minutes 20 seconds East departing the said North line
of Corporate Drive, a distance of 725.00 feet to a 1/2 inch iron rod set for
corner in the South right-of-way line of Greenway Drive;
THENCE South 89 degrees 53 minutes 40 seconds East along the South right-of-way
line of Greenway Drive, a distance of 400.00 feet to the POINT OF BEGINNING and
CONTAINING 290,000 square feet or 6.657 acres of land; and being the same
property conveyed to Corporate Realty Income Fund I, L.P., a Delaware limited
partnership, by that certain Special Warranty Deed dated October 24, 1986, filed
for record October 28, 1986 and recorded in Volume 86210, Page 0000, Xxxx
Xxxxxxx, Xxxxxx Xxxxxx, Xxxxx.
A-1
EXHIBIT B
XXXX OF SALE
THIS XXXX OF SALE (the "Xxxx of Sale") is made as of the ____ day of
________, 2004 by CORPORATE REALTY INCOME FUND I, L.P., a Delaware limited
partnership ("Seller") to FSP 0000 XXXXXXXXX XXXXX LIMITED PARTNERSHIP, a Texas
limited partnership ("Purchaser").
Seller and Purchaser are parties to a Purchase and Sale Agreement (the
"Purchase Agreement") dated as of ________ __, 2004 which provides for the sale
of Seller's interest in certain real property (the "Property") located in the
State of Texas as more particularly described on Schedule A attached hereto.
In connection with the Purchase Agreement, Seller is required to convey
to Purchaser certain items of tangible personal property as hereinafter
described.
NOW THEREFORE, in consideration of TEN AND NO/100 DOLLARS ($10.00) and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, Seller hereby CONVEYS AND TRANSFERS to Purchaser, its legal
representatives, successors and assigns, all of its right, title and interest in
and to personal property located on the Property and the improvements thereon
relating to the ownership, use, maintenance or operation of the Property and
said improvements.
SELLER MAKES NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE CONDITION OF THE
PERSONAL PROPERTY OR ITS MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE;
PROVIDED, HOWEVER, THAT SELLER COVENANTS THAT SELLER HAS NOT DONE OR SUFFERED
ANYTHING WHEREBY THE PERSONAL PROPERTY HAS BEEN ENCUMBERED IN ANY WAY WHATEVER.
BY ITS ACCEPTANCE OF THIS XXXX OF SALE, PURCHASER ACKNOWLEDGES THAT IT HAS FULLY
INSPECTED THE PERSONAL PROPERTY AND PURCHASER ACCEPTS THE SAME IN ITS PRESENT
USED AND "AS IS" CONDITION.
B-1
IN WITNESS WHEREOF, the foregoing Xxxx of Sale was executed as of the
date first set forth above.
CORPORATE REALTY INCOME FUND I, L.P.
By:
-------------------------------
Xxxxxx X. Xxxxxxx, Xx.
General Partner
By: 1345 Realty Corporation,
General Partner
By:
-------------------------------
Xxxxxx X. Xxxxxxx, Xx.
President
STATE OF )
:ss:
COUNTY OF )
On the __ day of __________, in the year 2004, before me, the
undersigned, personally appeared Xxxxxx X. Xxxxxxx, Xx., personally known to me
or proved to me on the basis of satisfactory evidence to be the individual whose
name is subscribed to the within instrument and acknowledged to me that he
executed the same in his capacities, and that by his signatures on the
instrument, the individual, or the person upon behalf of which the individual(s)
acted, executed the instrument.
---------------------------
Notary Public
My commission expires on ___________
B-2
SCHEDULE A
TO XXXX OF SALE
LEGAL DESCRIPTION OF PROPERTY
BEING all of Walnut Hill Business Park Fourth Installment, an Addition to the
City of Irving, Dallas County, Texas, according to the Map thereof recorded in
Volume 79068, Page 1713 of the Map Records of Dallas County, Texas and being
more particularly described as follows:
BEGINNING at a 1/2 inch iron rod found for corner at the intersection of the
West right-of-way line of Execution Drive (60' R.O.W.) and the South
right-of-way line of Greenway Drive (60' R.O.W.);
THENCE South 00 degrees 06 minutes 20 seconds West along the West right-of-way
line of Executive Drive, a distance of 725.00 feet to a 1/2 inch iron rod found
for corner at the intersection of the West line of said North right-of-way line
of Corporate Drive (60' R.O.W.);
THENCE North 89 degrees 53 minutes 40 seconds West along the North right-of-way
line of Corporate Drive, a distance of 400.00 feet to a 1/2 inch iron rod found
for corner;
THENCE North 00 degrees 06 minutes 20 seconds East departing the said North line
of Corporate Drive, a distance of 725.00 feet to a 1/2 inch iron rod set for
corner in the South right-of-way line of Greenway Drive;
THENCE South 89 degrees 53 minutes 40 seconds East along the South right-of-way
line of Greenway Drive, a distance of 400.00 feet to the POINT OF BEGINNING and
CONTAINING 290,000 square feet or 6.657 acres of land; and being the same
property conveyed to Corporate Realty Income Fund I, L.P., a Delaware limited
partnership, by that certain Special Warranty Deed dated October 24, 1986, filed
for record October 28, 1986 and recorded in Volume 86210, Page 0000, Xxxx
Xxxxxxx, Xxxxxx Xxxxxx, Xxxxx.
B-3
EXHIBIT C
ASSIGNMENT AND ASSUMPTION AGREEMENT
THIS ASSIGNMENT AND ASSUMPTION AGREEMENT ("Assignment"), is made as of
the ____ day of ________, 2004 by and between CORPORATE REALTY INCOME FUND I,
L.P., a Delaware limited partnership ("Assignor") and FSP 0000 XXXXXXXXX XXXXX
LIMITED PARTNERSHIP, a Texas limited partnership ("Assignee").
RECITALS
Assignor, as seller, and Assignee, as purchaser, are parties to a
Purchase and Sale Agreement ("Purchase Agreement") dated as of _________ __,
2004, which provides for the sale of Assignor's interest in certain real
property (the "Property") located in the State of Texas, as more particularly
described on Schedule A attached hereto; and
The Purchase Agreement provides, inter alia, (i) that Assignor shall
assign to Assignee certain leases, commission agreements, service contracts,
warranties and guaranties, (ii) that Assignee shall assume all of the
obligations of Seller thereunder from and after the date of Closing (as defined
in the Purchase Agreement), and (iii) that Assignor and Assignee shall execute
this Assignment.
NOW, THEREFORE, in consideration of TEN AND NO/100 DOLLARS ($10.00) and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:
1. Definitions. As used herein, the following terms have the following
meanings:
A. Accrued Obligations. All obligations or rights to damages which
accrued or arose prior to the Closing under any of the Assigned Property, as
defined below.
B. Assumed Obligations. All obligations of Seller under the
Assigned Property, as defined below, which arise or accrue on or after the
Closing.
2. Assignment. Assignor hereby conveys and assigns to Assignee all of
its right, title and interest in, to and under the following (collectively, the
"Assigned Property"):
C-1
A. those certain tenant space leases set forth on Schedule B
attached hereto; together with all rents and other sums due thereunder (other
than Delinquent Rents (as defined in the Purchase Agreement) and other
additional rent and reimbursements payable under such tenant space leases and
accruing prior to the Closing) after Closing and any and all security deposits
in connection therewith;
B. those certain equipment leases set forth on Schedule C attached
hereto, to the extent assignable;
C. those certain commission agreements disclosed to Purchaser prior
to the Out Date (as defined in the Purchase Agreement) set forth on Schedule D
attached hereto, to the extent assignable;
D. those certain service and maintenance contracts set forth on
Schedule E attached hereto, to the extent assignable;
E. all permits and licenses held by Assignor pertaining to the
Property, to the extent assignable;
F. all unexpired guaranties, warranties (including guaranties and
warranties pertaining to the construction and maintenance of the Improvements),
permits, approvals, licenses, legal certificates, and authorizations pertaining
to the Property, to the extent assignable;
G. all other intangibles pertaining to the Property, to the extent
assignable; and
H. the trade name for the Property, all of Assignor's telephone
numbers at the Property, and all marketing, advertising and promotional material
and photographs of the Property.
3. Assumption. Assignee hereby assumes and agrees timely to perform the
Assumed Obligations.
4. Indemnity. Assignee hereby indemnifies and agrees to defend and hold
harmless Assignor from any loss, cost, claim, liability, expense or demand of
whatever nature arising from any breach or failure of Assignee to observe or
perform any of the Assumed Obligations. Assignor hereby indemnifies and agrees
to defend and hold harmless Assignee from any loss, cost, claim, liability,
expense or demand of whatever nature arising from any breach or failure of
Assignor to observe or perform any of the Accrued Obligations.
5. Claims. As a condition to the liability of the other party
hereunder, the claiming parting ("Claiming Party") shall notify the other party
("Other Party"), in writing, of any claim ("Claim") covered by this Assignment
within a reasonable time after the assertion thereof by a third party against
Claiming Party. In the event of such a
C-2
notice of a Claim by Claiming Party to Other Party, Other Party shall have ten
(10) days after receipt thereof in which to undertake the defense of the Claim
on behalf of itself and Claiming Party. If Other Party so undertakes to defend
said Claim on behalf of itself and Claiming Party, it shall retain and pay
counsel to conduct such defense. Such counsel shall be subject to the approval
of the Claiming Party which approval shall not be unreasonably withheld or
delayed. Claiming Party may employ its own counsel to work with Other Party as
counsel in connection with the defense of said Claim, but Claiming Party shall
pay all fees and disbursements of said counsel. Other Party may settle the
Claim, without the consent of Claiming Party, to the extent the settlement does
not bind Claiming Party or impose any obligation on Claiming Party. If Claiming
Party would have any liability for the payment and/or performance of any
settlement, Claiming Party's written consent thereto must be obtained by Other
Party in order for said settlement to be binding upon Claiming Party.
If Other Party refuses or fails to so undertake to defend the Claim,
Claiming Party may defend the same on its own behalf, may retain and pay counsel
to conduct such defense and may settle the Claim, without the consent of Other
Party. Other Party shall then reimburse Claiming Party (a) for all reasonable
costs, including court costs and reasonable attorneys' fees, incurred by
Claiming Party in connection with said defense and/or any such settlement and
(b) for all sums paid pursuant to any judgment, including interest, against
Claiming Party in connection therewith or any such settlement.
6. This Assignment may be executed in counterparts, each of which shall
be an original and all of which taken together shall constitute one and the same
Assignment. This Assignment shall become effective only after each of the
parties hereto shall have executed and delivered it to the other.
C-3
IN WITNESS WHEREOF, Assignor and Assignee have executed this Assignment
as of the date first set forth above.
ASSIGNOR:
CORPORATE REALTY INCOME FUND I, L.P.
By:
-------------------------------------
Xxxxxx X. Xxxxxxx, Xx.
General Partner
By: 1345 Realty Corporation,
General Partner
By:
-------------------------------
Xxxxxx X. Xxxxxxx, Xx.
President
ASSIGNEE:
FSP 0000 XXXXXXXXX XXXXX LIMITED
PARTNERSHIP, a Texas limited partnership
By: FSP 0000 XXXXXXXXX XXXXX LLC,
its general partner
By:
-------------------------------------
Xxxxxxx Xxxxxxx Xxxxxxxx, its Treasurer
C-4
SCHEDULE A
TO ASSIGNMENT AND ASSUMPTION AGREEMENT
LEGAL DESCRIPTION OF PROPERTY
BEING all of Walnut Hill Business Park Fourth Installment, an Addition to the
City of Irving, Dallas County, Texas, according to the Map thereof recorded in
Volume 79068, Page 1713 of the Map Records of Dallas County, Texas and being
more particularly described as follows:
BEGINNING at a 1/2 inch iron rod found for corner at the intersection of the
West right-of-way line of Execution Drive (60' R.O.W.) and the South
right-of-way line of Greenway Drive (60' R.O.W.);
THENCE South 00 degrees 06 minutes 20 seconds West along the West right-of-way
line of Executive Drive, a distance of 725.00 feet to a 1/2 inch iron rod found
for corner at the intersection of the West line of said North right-of-way line
of Corporate Drive (60' R.O.W.);
THENCE North 89 degrees 53 minutes 40 seconds West along the North right-of-way
line of Corporate Drive, a distance of 400.00 feet to a 1/2 inch iron rod found
for corner;
THENCE North 00 degrees 06 minutes 20 seconds East departing the said North line
of Corporate Drive, a distance of 725.00 feet to a 1/2 inch iron rod set for
corner in the South right-of-way line of Greenway Drive;
THENCE South 89 degrees 53 minutes 40 seconds East along the South right-of-way
line of Greenway Drive, a distance of 400.00 feet to the POINT OF BEGINNING and
CONTAINING 290,000 square feet or 6.657 acres of land; and being the same
property conveyed to Corporate Realty Income Fund I, L.P., a Delaware limited
partnership, by that certain Special Warranty Deed dated October 24, 1986, filed
for record October 28, 1986 and recorded in Volume 86210, Page 0000, Xxxx
Xxxxxxx, Xxxxxx Xxxxxx, Xxxxx.
C-5
SCHEDULE B
TO ASSIGNMENT AND ASSUMPTION AGREEMENT
LEASES
[To be provided]
C-6
SCHEDULE C
TO ASSIGNMENT AND ASSUMPTION AGREEMENT
EQUIPMENT LEASES
[To be provided]
C-7
SCHEDULE D
TO ASSIGNMENT AND ASSUMPTION AGREEMENT
COMMISSION AGREEMENTS
[To be provided]
C-8
SCHEDULE E
TO ASSIGNMENT AND ASSUMPTION AGREEMENT
SERVICE CONTRACTS
[To be provided]
X-0
XXXXXXX X
XXXXXX'X XXXXXXXXX
XXXXX XX XXX XXXX )
) ss.:
COUNTY OF NEW YORK )
Section 1445 of the Internal Revenue Code provides that a transferee of
a United States real property interest must withhold tax if the transferor is a
foreign person. To inform the transferee that withholding of tax is not required
upon the disposition of a United States real property interest by CORPORATE
REALTY INCOME FUND I, L.P., a Delaware limited partnership ("CRIF") the
undersigned hereby certifies the following on behalf of CRIF:
1. CRIF is not a foreign corporation, foreign partnership, foreign
trust, foreign estate or foreign person (as those terms are defined in the
Internal Revenue Code and Income Tax Regulations); and
2. CRIF's U.S. employer tax identification number is 00-0000000; and
3. CRIF's office address is 000 Xxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx
Xxxx 00000.
CRIF understands that this certification may be disclosed to the
Internal Revenue Service by transferee and that any false statement contained
herein could be punished by fine, imprisonment, or both.
The undersigned as a general partner of CRIF and as officer of a general
partner of CRIF declares that he has examined this certification and to the best
of his knowledge and belief it is true, correct and complete, and he further
declares that he has authority to sign this document on behalf of CRIF.
D-1
Dated: ___________ __, 2004
CORPORATE REALTY INCOME FUND I, L.P.
By:
-----------------------------
Xxxxxx X. Xxxxxxx, Xx.
General Partner
By: 1345 Realty Corporation,
General Partner
By:
---------------------------------
Xxxxxx X. Xxxxxxx, Xx.
President
Sworn to and subscribed before
me this _____ day of ________, 2004.
------------------------------------
Notary Public
D-2
EXHIBIT E
Intentionally Omitted
E-1
EXHIBIT F
FORM OF SPECIAL WARRANTY DEED
SPECIAL WARRANTY DEED
STATE OF )
) KNOW ALL MEN BY THESE PRESENTS:
COUNTY OF )
THAT CORPORATE REALTY INCOME FUND I, L.P., a Delaware limited
partnership ("Grantor"), for and in consideration of the sum of TEN AND NO/100
DOLLARS ($10.00) and other good and valuable consideration to it in hand paid by
FSP 0000 XXXXXXXXX XXXXX LIMITED PARTNERSHIP, a Texas limited partnership
("Grantee"), whose address for mailing purposes is _______________________, the
receipt and sufficiency of which is hereby acknowledged and confessed; has
GRANTED, SOLD and CONVEYED, and by these presents does hereby GRANT, SELL and
CONVEY, unto Grantee, all that certain tract of land, together with all
improvements now or at any time hereafter located on the hereinafter-described
property or attached to the improvements thereon, lying and being situated in
the County of Dallas, State of Texas, and being more particularly described by
metes and bounds on Exhibit A attached hereto and made a part hereof for all
purposes (the "Subject Property").
THIS CONVEYANCE of the Subject Property is made and accepted expressly
subject to the matters shown on Exhibit B attached hereto and made a part hereof
for all purposes.
TO HAVE AND TO HOLD the Subject Property, together with all and singular
the rights, titles and appurtenances thereto in anywise belonging, unto Grantee,
its successors and assigns forever; and Grantor does hereby bind itself, its
successors and assigns, to WARRANT and FOREVER DEFEND all and singular the
Subject Property unto Grantee, its successors and assigns, against every person
whomsoever lawfully claiming, or to claim the same or any part thereof, by,
through or under Grantor but not otherwise, except for the matters set forth on
Exhibit B.
[SIGNATURES ON NEXT PAGE]
F-1
EXECUTED this _____ day of ___________, 2004.
CORPORATE REALTY INCOME FUND I, L.P.
By:
------------------------------
Xxxxxx X. Xxxxxxx, Xx.
General Partner
By: 1345 Realty Corporation,
General Partner
By:
-------------------------------
Xxxxxx X. Xxxxxxx, Xx.
President
STATE OF _________ )
)
COUNTY OF ________ )
This instrument was acknowledged before me on the ____ day of
__________, 2004, by Xxxxxx X. Xxxxxxx, Xx., as General Partner of CORPORATE
REALTY INCOME FUND I, L.P., a Delaware limited partnership, and as President of
1345 Realty Corporation, General Partner of CORPORATE REALTY INCOME FUND I,
L.P., a Delaware limited partnership.
---------------------------------------
Notary Public
Printed Name:
My Commission expires:
F-2
EXHIBIT A
TO SPECIAL WARRANTY DEED
LEGAL DESCRIPTION OF PROPERTY
BEING all of Walnut Hill Business Park Fourth Installment, an Addition to the
City of Irving, Dallas County, Texas, according to the Map thereof recorded in
Volume 79068, Page 1713 of the Map Records of Dallas County, Texas and being
more particularly described as follows:
BEGINNING at a 1/2 inch iron rod found for corner at the intersection of the
West right-of-way line of Execution Drive (60' R.O.W.) and the South
right-of-way line of Greenway Drive (60' R.O.W.);
THENCE South 00 degrees 06 minutes 20 seconds West along the West right-of-way
line of Executive Drive, a distance of 725.00 feet to a 1/2 inch iron rod found
for corner at the intersection of the West line of said North right-of-way line
of Corporate Drive (60' R.O.W.);
THENCE North 89 degrees 53 minutes 40 seconds West along the North right-of-way
line of Corporate Drive, a distance of 400.00 feet to a 1/2 inch iron rod found
for corner;
THENCE North 00 degrees 06 minutes 20 seconds East departing the said North line
of Corporate Drive, a distance of 725.00 feet to a 1/2 inch iron rod set for
corner in the South right-of-way line of Greenway Drive;
THENCE South 89 degrees 53 minutes 40 seconds East along the South right-of-way
line of Greenway Drive, a distance of 400.00 feet to the POINT OF BEGINNING and
CONTAINING 290,000 square feet or 6.657 acres of land; and being the same
property conveyed to Corporate Realty Income Fund I, L.P., a Delaware limited
partnership, by that certain Special Warranty Deed dated October 24, 1986, filed
for record October 28, 1986 and recorded in Volume 86210, Page 0000, Xxxx
Xxxxxxx, Xxxxxx Xxxxxx, Xxxxx.
G-1
EXHIBIT B
TO SPECIAL WARRANTY DEED
PERMITTED EXCEPTIONS
[To be inserted]
EXHIBIT G
TENANT NOTIFICATION LETTER
_________ __, 2004
Tenant
__________________
__________________
Re:
Dear Tenant:
You are currently a tenant at the above address. The purpose of this
letter is to inform you that Corporate Realty Income Fund I, L.P. has sold the
building to FSP 0000 Xxxxxxxxx Xxxxx Limited Partnership ("Buyer") and
transferred any and all security deposits under your Lease to Buyer.
You should make all rental payments and direct any inquiries relating to
the Property after the date of this notice to the new manager of the Property:
_____________________
_____________________
_____________________
Attn:________________
Very truly yours,
CORPORATE REALTY INCOME FSP 0000 XXXXXXXXX XXXXX LIMITED
FUND I, L.P. PARTNERSHIP, a Texas limited partnership
By: FSP 0000 XXXXXXXXX XXXXX LLC, its
general partner
By:
-----------------------------
Xxxxxx X. Xxxxxxx, Xx.
General Partner
By:
-------------------------------------
By: 1345 Realty Corporation, Xxxxxxx Xxxxxxx Xxxxxxxx, its Treasurer
General Partner
By:
-------------------------
Xxxxxx X. Xxxxxxx, Xx.
President
G-1
EXHIBIT H
SERVICE CONTRACTS
See attached.
H-1
EXHIBIT I
FORM OF TENANT ESTOPPEL CERTIFICATE
THIS IS TO CERTIFY TO FSP 0000 XXXXXXXXX XXXXX LIMITED PARTNERSHIP THAT
as of the date hereof:
1. The undersigned is the Lessee ("Tenant") under that certain Lease (the
"Lease") dated _______________ by and between ___________________ as
Landlord ("Landlord"), and ___________________ as Tenant, covering those
certain premises commonly known as ___________________ (the "Premises")
in the property known as ___________________ (the "Property"), as
amended by ___________________. A true and accurate copy of the Lease
(together with all amendments thereof, if any) is attached hereto as
Exhibit "A."
2. The Lease is in full force and effect and has not been assigned,
modified, supplemented, altered or amended in any respect (except as
indicated following this sentence) and is the only lease or agreement
between the undersigned and Landlord affecting the Premises. If none,
state "none."
None
3. The undersigned has accepted possession in accordance with the terms of
the Lease and now occupies the Premises and is currently open for
business. The improvements, space and parking facilities, if any,
required to be furnished under the Lease have been completed and
furnished and are satisfactorily completed in all respects. All
conditions of the Lease to be performed by Landlord prior to the
effectiveness of the Lease have been satisfied. Any required payments or
inducement from Landlord to Tenant have been made, except (if none,
state "none"):
None
4. The undersigned has no knowledge of any event which with the giving of
notice, the passage of time or both would constitute a default under the
Lease on the part of Tenant or Landlord.
5. The Lease term began ___________________, and the current Lease term
expires ___________________. The fixed minimum rent presently being paid
is $___________________ per annum in monthly installments of
$___________________. All rentals, charges and other obligations on the
part of the undersigned under the Lease have been paid to and including
September 1, 2004. No rental, other than for the current month, has been
paid in advance.
6. In addition to the above-referenced fixed minimum rent, the Tenant pays
all real estate taxes and operating expenses in excess of taxes and
operating expenses for calendar year 2003.
I-1
7. There are no existing defenses, which the undersigned has against the
enforcement of the Lease by Landlord. The undersigned is entitled to no
free rent nor any credits, offsets or deductions in rent, nor other
leasing concessions except as follows:
None
8. The Lease contains, and the undersigned has, no outstanding options or
rights of first refusal to purchase the Premises or any part thereof or
the real property of which the Premises are a part. As used in this
paragraph, the term "options" shall not include options to renew or
extend the terms of the Lease.
9. The amount of the security deposit presently held under the Lease is (if
none, state "none"):
None
10. No actions, whether voluntary or otherwise, are pending against the
undersigned under the bankruptcy laws of the United States or any state
thereof.
11. This certification is made with the knowledge that it will be relied
upon in connection with financings and sales of the Property and may be
relied upon by the current and any future Landlord of the Premises, any
current or future holder of a mortgage or deed of trust of the Property,
and their respective successors and assigns.
Upon completion, please return to Landlord, c/o _______________________________.
DATED this 1st day of September, 2004.
THIS ESTOPPEL MUST BE DATED WHEN SIGNED.
TENANT:
By:
--------------------------------
Name:
---------------------------
Its:
----------------------------
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EXHIBIT J
FORM OF SELLER'S RECERTIFICATION OF
REPRESENTATIONS AND WARRANTIES
Corporate Realty Income Fund I, L.P., a Delaware limited partnership
("CRIF") hereby certifies to FSP 0000 Xxxxxxxxx Xxxxx Limited Partnership, a
Texas limited partnership ("Purchaser") that the representations and warranties
set forth in Section 6.1 of that certain Purchase and Sale Agreement between
CRIF and Purchaser dated as of September __, 2004 (the "Purchase Agreement") are
true, correct and complete as of the date hereof.
This Recertification is subject to the terms and conditions of the
Purchase Agreement including without limitation the provisions and limitations
of the last four (4) paragraphs of Section 6.1 thereof.
CORPORATE REALTY INCOME FUND I, L.P.
By:
-------------------------------
Xxxxxx X. Xxxxxxx, Xx.
General Partner
By: 1345 Realty Corporation,
General Partner
By:
---------------------------------
Xxxxxx X. Xxxxxxx, Xx.
President
Dated: ______________, 2004
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EXHIBIT K
FORM OF PURCHASER'S RECERTIFICATION
OF REPRESENTATIONS AND WARRANTIES
The undersigned hereby certifies to Corporate Realty Income Fund I,
L.P., a Delaware limited partnership ("CRIF"), that the representations and
warranties set forth in Section 6.2 of that certain Purchase and Sale Agreement
between CRIF, as Seller and the undersigned as Purchaser dated as of September
__, 2004 ("Purchase Agreement") are true, correct and complete as of the date
hereof.
FSP 0000 XXXXXXXXX XXXXX LIMITED
PARTNERSHIP, a Texas limited partnership
By: FSP 0000 XXXXXXXXX XXXXX LLC,
its general partner
By:
------------------------------------
Xxxxxxx Xxxxxxx Xxxxxxxx, its Treasurer
Dated:______________, 2004
K-1
EXHIBIT L
RENT ROLL
Landlord: Corporate Realty Income Fund I, L.P., a Delaware limited
partnership
Tenant: Verizon Directories Corp., a Delaware corporation (as successor-in-
interest to GTE Directories Corporation, a Delaware corporation)
Date: As of April 20, 1994
Amendments: Amendment No. 1 dated July 29, 1994
Amendment No. 2 dated February 22, 1995
Letter dated July 31, 1996
Extension Agreement and Supplement dated March 31, 2000
Second Extension Agreement and Supplement dated November __, 2002
Monthly Rent:$______________
Status: Current
Deposit: $______________
Leasing commissions payable with respect to current term: Commission of 2.25% of
rent payable for current extension term is payable at or prior to closing to TAG
Realty
L-1
SCHEDULE 1
PERSONAL PROPERTY
1 Gas-powered power washer
1 Gas-powered blower
1 Sheetrock Dolly
1 2-wheel dolly
1 Flat-bed dolly 3" x 4"
1 Small Cart
2 6' Fiberglass ladders
1 4' Fiberglass Ladder
1 2' Wooden Ladder
1 Dell Computer for Andover Automation System
1 Non-flammable Cabinet
1 Electrical routing machine 3/8"
1 Small light cart
8 Metal Shelves 8'
2 Metal Cabinets 6'
Misc. Bldg. Engineers tools
1
SCHEDULE 2
PERMITS
Certificate of Occupancy 94-00784 9/20/1994
Certificate of Occupancy 91-00555 5/9/2003
Certificate of Occupancy 94-00785 8/1/1994
Certificate of Occupancy 94-00786 10/17/1994
Certificate of Occupancy 91-00556 6/11/2003
Certificate of Occupancy 94-01097 10/10/1994
Certificate of Occupancy 91-00934 5/9/2003
Certificate of Occupancy 95-00347 05/09/95
Certificate of Compliance, State of Texas (Elevator) 1/15/2004
Letter of Compliance, State of Texas, ADA 4/29/2000
2
SCHEDULE 3
SERVICE AND OTHER CONTRACTS
Air Performance Flakt fan inspection and maintenance.
Arch Wireless/Pagenet Provides pager service and equipment for two
engineers.
Chem-Aqua Water quality control in HVAC systems.
Ecolab Pest elimination.
GreenForest Landscaping Lawn care and maintenance.
Mechanical Solutions, Inc. Preventive maintenance program for chiller and
pump.
Mechanical Solutions, Inc. Maintenance program for equipment.
Mitec Life Safety Systems Inspection and repair of fire panel and life
safety equipment.
Xxxxxxx & Xxxxxxxxx Maintenance of emergency generator.
TAG Realty Mgmt., Inc. Management Contract.
ThyssenKrupp Elevator Maintenance of elevator equipment.
Staubach Company Commission Agreement
TAG Realty Commission Agreement
3
