PURCHASE AND SALE AGREEMENT
September 24, 1997
Subject to the terms and conditions contained herein, PAN PACIFIC RETAIL
PROPERTIES, INC., a Maryland corporation ("Buyer"), agrees to purchase, and
MGMAB LIMITED PARTNERSHIP, a Washington limited partnership ("Seller"),
agrees to sell the following, all of which are collectively referred to as
the "Property":
A. All of Seller's right, title and interest in and to that certain
real property commonly known as Claremont Village Shopping Center, legally
described on Exhibit A hereto; and all of the Seller's right, title and
interest in and to all rights, privileges, improvements and easements
appurtenant to said real property;
B. All leased equipment, signs and fixtures, if any, and all personal
property owned by Seller which is located on or in or used exclusively in
connection with the Property (the "Personal Property"); and
C. All intangible personal property now or hereafter owned by Seller
and used in the ownership, use or operation of the Property, including,
without limitation, the Seller's interest in and to all tenant leases,
subleases and tenancies, any service contracts and other agreements, records
relating to the Property and rights relating to the ownership, use and
operation of the Property, and all of Seller's right, title and interest in
trade names, trademarks, and service marks, if any, designating or describing
the Property.
The terms and conditions of the sale are as follows:
1. PURCHASE PRICE AND TERMS. The purchase price for the Property shall
be TEN MILLION SEVEN HUNDRED FIFTY THOUSAND AND NO/100 DOLLARS
($10,750,000.00), and shall be paid as follows:
(a) The Buyer shall pay Seller the entire purchase price in cash or
immediately available funds, including the xxxxxxx money deposit earmarked
for this transaction, at Closing.
(b) PRICE ADJUSTMENT. The purchase price is based on the
assumption that three leases will be signed by Seller with new tenants of a
quality and financial standing commensurate with existing tenants of the
Property prior to Closing for a term of at least five (5) years at an average
rental rate (including free rent and rent escalations) of not less than
$11.00 per square foot for the 11,817 square foot space,
Real Estate Purchase and Sale Agreement - 1
and for terms of at least three (3) years at average rental rates of $12.00
per square foot for the 1,302 square foot space and the 1,296 square foot
space. All costs associated with the leases including, but not limited to
improvements, tenant improvements, advertising and leasing commissions, shall
be paid by Seller. Any such lease shall not be entered into by Seller except
with the written consent of Buyer, which consent shall not be unreasonably
withheld or delayed. If any of these new leases is for an average rental
rate other than as specified above, the purchase price of the property shall
be increased or decreased accordingly on the basis of the following
calculation. The annual rent for the space will be calculated on the basis
of the rental rates specified above. Any difference between this annual rent
and the actual average annual rent agreed to by the new tenant will be
multiplied by a factor of ten, and if the actual average rental rate is
greater than the rental rate specified above, this product will be added to
the purchase price, and if the actual average rental rate is less than the
rental rate specified above, the product will be deducted from the purchase
price. If any of the new leases has not been entered into by Closing, the
purchase price shall be adjusted as provided in paragraph 1(c) below.
(c) EXECUTION OF LEASE. In the event that Seller has not leased
either or both of the other two currently vacant spaces by Closing, the
purchase price shall be reduced as follows: the 1,302 square foot space --
$25,000 if vacant, and the 1,296 square foot space -- $5,000 if vacant.
Further, Seller shall enter into a lease between Seller, as tenant, and
Buyer, as landlord, at Closing, for the unleased space. The lease will be
for a term of one (1) year at the rental rate specified for the space in
paragraph 1(b) above. The lease shall provide that if, within one (1) year
after Closing, the space is leased by Buyer or Seller to a new tenant on the
same lease terms as those provided in paragraph 1(b) of this Agreement, or on
other terms acceptable to Buyer, the lease between Buyer and Seller shall
terminate as of the effective date of the new lease. The lease between Buyer
and Seller shall also provide that as consideration for the purchase price
reduction all of the costs of leasing the space to a new tenant which are
allocated to Seller under paragraph 1(b) shall be paid for and shall instead
be the obligation of Buyer with respect to any lease of said space entered
into with a new tenant after Closing.
2. XXXXXXX MONEY DEPOSIT.
(a) INITIAL DEPOSIT. As a condition of Mutual Acceptance (as defined
in paragraph 5(e) below), Buyer shall deposit the sum of TWO HUNDRED FIFTY
THOUSAND AND NO/100
Real Estate Purchase and Sale Agreement - 2
DOLLARS ($250,000.00) with First American Title Insurance Company, 00000 X.X.
00xx Xxxxxx, #X, Xxxxxxxx, XX 00000 (the "Closing Agent"), with instructions
to First American to deposit the funds into an insured interest bearing trust
account. Of this deposit, $62,500.00 shall be earmarked and held by the
Closing Agent as the initial xxxxxxx money deposit for this transaction, and
the balance of the deposit shall be earmarked as the xxxxxxx money deposit
for the purchases of the Other Properties (as defined below). All accrued
interest shall be credited at Closing to Buyer, whose social security or tax
I.D. number is ________________________. If this transaction fails to close,
the interest shall be paid to the same party entitled to be paid the xxxxxxx
money. If Buyer does not give Seller the Notice of Waiver of Certain
Contingencies and make the Additional Deposit with the Closing Agent within
the time and in the manner provided for in paragraphs 2(b) and 5(d), this
Agreement shall be deemed terminated, the entire xxxxxxx money deposit shall
be returned to Buyer, and Buyer and Seller shall have no further obligations
hereunder.
(b) ADDITIONAL DEPOSIT. If Buyer gives Seller the Notice of Waiver
of Certain Contingencies, Buyer shall simultaneously deposit an additional
$750,000 with the Closing Agent in immediately available funds as an
additional xxxxxxx money deposit. The entire $1,000,000 deposited with the
Closing Agent shall thereafter be held as an xxxxxxx money deposit, which
shall be credited to Buyer, with interest at Closing. Except as otherwise
provided in paragraphs 3, 4, 5 and 6 of this Agreement, if this transaction
does not close thereafter, the xxxxxxx money deposit shall be disbursed by
the Closing Agent as provided in paragraph 21.
(c) EARMARKING. When the $1,000,000 mentioned in paragraph 2(b)
has been deposited as xxxxxxx money, the sum of $250,000.00 shall be
earmarked and held by the Closing Agent as the xxxxxxx money deposit for this
transaction, and the balance of the funds shall be earmarked as the xxxxxxx
money for the purchase of the Other Properties (as defined in paragraph 5(e)).
3. NO FINANCING CONTINGENCY. Buyer's obligation to close is not
conditioned upon Buyer obtaining financing for any portion of the purchase
price.
4. TITLE REVIEW. Within ten (10) calendar days of the date of Mutual
Acceptance, Seller shall deliver or cause to be delivered to Buyer, an ALTA
preliminary commitment for title insurance issued by First American Title
Insurance Company on the Property and copies of all of the documents noted as
title exceptions in the commitment. Buyer shall have twenty (20) calendar
days after the receipt of the commitment within which to notify Seller in
writing of Buyer's disapproval of any of the exceptions, encumbrances or
defects shown in the commit-
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ment. Failure of Buyer to provide written notice of disapproval of any
encumbrances or defects within the aforementioned time limit shall be deemed
notice of approval.
If Buyer objects to any exceptions, Seller shall, within ten (10)
calendar days after receipt of Buyer's objections, deliver to Buyer written
notice that either (a) Seller will, at Seller's expense, attempt to remove
the exceptions to which Buyer has objected before the Closing Date or (b)
Seller is unwilling or unable to eliminate said exceptions. If Seller fails
to so notify Buyer or is unwilling or unable to remove any such exception by
the Closing Date, Buyer may elect to terminate this Agreement and receive
back the entire xxxxxxx money, in which event Buyer and Seller shall have no
further obligations under this Agreement; or, alternatively, Buyer may elect
to purchase the Property subject to such exceptions.
5. INSPECTION CONTINGENCIES. Buyer's obligation to purchase the
Property is conditioned and contingent upon Buyer's satisfaction with the
following:
(a) BOOKS, RECORDS AND AGREEMENTS. Seller agrees to provide Buyer
with the items listed below for Buyer's review and evaluation as soon as
practicable after Mutual Acceptance:
(i) All rental agreements, leases, and all subleases,
assignments, amendments and modifications thereto, and all service contracts,
warranties, and other written agreements or notices which relate to the
Property;
(ii) Annual operating statements of the Property for the most
recent three (3) full calendar years, as well as tenants' sales reports in
Seller's possession or available to Seller and common area maintenance costs
and collections for the same period;
(iii) Copies of all CC&R's affecting the Property;
(iv) A complete and current rent roll, including a schedule of
all tenant deposits and fees;
(v) The tax bills and assessment notices for the most recent
tax year;
(vi) Copies of all Certificates of Occupancy that are in
Seller's possession;
(vii) Copies of any surveys, environmental audits, soil
studies, engineering studies, "as-built" plans, permits, and any and all
other reports pertaining to the land
Real Estate Purchase and Sale Agreement - 4
or buildings constructed on the Property in Seller's possession; and
(viii) Copies of any Tenant financial statements within
Seller's possession.
(ix) A schedule of all personal property;
(x) Copies of Seller's certificate of limited partnership and a
good standing certificate;
(xi) A schedule of filed, threatened, or potential litigation
regarding the Property; and
(xii) An aged receivables report for payments owed by Tenants
and the leases current as of the date of Mutual Acceptance.
After the commencement of the Inspection Period (as defined below), Buyer
may request copies of any other reports, studies or other documents relating
to the Property which are in Seller's possession or reasonably available to
Seller at little or no cost. Upon such request, Seller shall promptly
provide Buyer with copies of the requested documents or permit Buyer access
to Seller's records so as to review and copy the documents.
(b) PHYSICAL INSPECTION. During the Inspection Period Seller shall
permit Buyer or its agents, at Buyer's sole expense and risk, to enter upon
the Property, as reasonably necessary and subject to the rights of tenants,
to make inspections and investigations concerning the structural condition of
the improvements, all mechanical, electrical and plumbing systems, hazardous
materials (limited to a Phase I audit only without further consent of Seller,
which consent shall not be unreasonably withheld or delayed), pest
infestation, soils conditions, the roof and other matters pertaining to the
condition of the Property. Buyer shall comply with all laws and regulations,
including, without limitation, obtaining any necessary permits for any
inspection of the Property. Any damage to the Property made by Buyer or any
authorized person acting for or on behalf of Buyer shall be promptly repaired
by Buyer, and Buyer shall put the Property back in the same condition as
before the inspection or entry. Buyer agrees to indemnify and hold Seller
harmless from all liens, costs, and expenses, including attorney's and
expert's fees, arising from or relating to Buyer's entry onto and inspection
of the Property.
(c) FEASIBILITY. During the Inspection Period, Buyer, or its agents,
may investigate whether any federal, state or local laws which may apply to the
Property, such as the Americans with Disabilities Act or laws or regulations
Real Estate Purchase and Sale Agreement - 5
regarding sensitive areas, zoning, building codes, energy codes, energy
conservation and the like affect the feasibility of the Property for Buyer's
intended use, and shall be provided reasonable access to the Property and to
Seller's records regarding the Property for purposes of this review.
(d) INSPECTION PERIOD. Seller shall use best efforts to provide
Buyer with all documents and things specified in paragraphs 5(a)(i)-(xii) as
soon as reasonably practicable after Mutual Acceptance. Buyer shall have
forty-five (45) calendar days following receipt of all documents and things
specified in paragraphs 5(a)(i)-(xii) within which to investigate all of the
documents, things and conditions specified in paragraphs 5(a), (b) and (c),
or any other matter pertaining to the Property which may be of concern to
Buyer (the "Inspection Period"). If Buyer decides to waive the contingencies
set forth in paragraphs 5(a), (b) and (c) and intends to close the purchase
and sale of the Property as specified in this Agreement, Buyer shall indicate
its decision to do so by giving Seller written notice (the Notice of Waiver
of Certain Contingencies) and simultaneously depositing the additional
xxxxxxx money deposit with the Closing Agent as provided in paragraph 2(b) on
or before the last day of the Inspection Period. If Buyer fails to either
give Seller the Notice of Waiver of Certain Contingencies or to deposit the
additional xxxxxxx money deposit with the Closing Agent within the time
specified, this Agreement shall be deemed terminated, Buyer's entire xxxxxxx
money deposit shall be returned to Buyer, and Buyer and Seller shall have no
further obligations hereunder.
(e) INSPECTION OF OTHER PROPERTIES. At the same time as this
Agreement is signed, Buyer will be entering into purchase and sale agreements
to purchase Olympia West Plaza Shopping Center in Xxxxxxxx County,
Washington, and Tacoma Central Shopping Center in Xxxxxx County, Washington,
collectively, the "Other Properties." Mutual Acceptance of this Agreement
will occur only when:
(i) Seller and Buyer have signed this Agreement;
(ii) Buyer has entered into written agreements with regard to
the purchase and sale of the Other Properties;
(iii) Buyer has deposited the initial xxxxxxx money deposit
with the Closing Agent as provided in paragraph 2(a) hereof. Each of the
purchase and sale agreements for the Other Properties will also have an
inspection period of forty-five (45) calendar days which will commence when
the seller of each of the Other Properties has delivered documents such as
those described in paragraph 5(a) hereof to Buyer. If
Real Estate Purchase and Sale Agreement - 6
those documents are delivered by the respective sellers on a date after the
date Seller has delivered its documents under paragraph 5(a) of this
Agreement, the Inspection Period under this Agreement shall be extended by
the same number of days. Furthermore, Closing under this Agreement is
contingent upon Buyer waiving all contingencies under the purchase and sale
agreements for the Other Properties within the Inspection Period under this
Agreement, as it may be extended.
6. ADDITIONAL CONDITIONS TO CLOSING.
(a) TENANT ESTOPPEL CERTIFICATES. Buyer's obligation to purchase
the Property is conditioned upon Seller obtaining and delivering to Buyer at
or before Closing estoppel certificates from each tenant at the Property
occupying more than 3,000 square feet of space and seventy-five percent (75%)
of all other Tenants occupying space on the Property. The estoppel
certificates shall state:
(i) The date of commencement and the scheduled date of
termination of the Lease;
(ii) The amount of advance rentals or rent deposits paid to
the Seller;
(iii) The amount of monthly (or other periodic) rent paid to
Seller;
(iv) That the Lease is in full force and effect and that
there have been no modifications or amendments thereto, or, if there have
been any modifications, subleases, assignments or amendments, an explanation
of the same;
(v) Square footage (if set forth in the Lease); and
(vi) That there is no default under the terms of the Lease by
Lessor or Lessee.
In the event such estoppel certificates are not delivered to Buyer prior
to Closing, Buyer may terminate this Agreement, in which event all xxxxxxx
money, additional xxxxxxx money and accrued interest shall be paid to Buyer,
and Buyer and Seller shall have no further obligations under this Agreement.
(b) SIMULTANEOUS CLOSINGS. Both parties' obligations to close this
transaction are conditioned upon the closing of this transaction and the
closing of the purchase and sale of both of the Other Properties by Buyer
occurring simultaneously. If for any reason the purchase of either of the
Other Properties by Buyer does not close on the Closing Date specified
herein, this transaction shall not close. If the other transaction did not
close because of the fault of
Real Estate Purchase and Sale Agreement - 7
either Buyer or Seller, the other party shall have all of its remedies under
this Agreement as a non-defaulting party. If the other transaction does not
close for any reason other than the fault of Buyer or the default of Seller,
this transaction shall terminate, Buyer's entire xxxxxxx money deposit shall
be returned to Buyer, and Buyer and Seller shall have no further obligations
hereunder.
7. CLOSING. First American Title Insurance Company, as Closing Agent,
shall conduct the Closing of the transaction. Immediately upon Mutual
Acceptance, the parties hereto shall deposit with the Closing Agent this
Agreement, and the xxxxxxx money deposit and within a reasonable time prior
to Closing shall deposit such instruments and funds as are necessary to close
the escrow and consummate the purchase and sale of the Property in the manner
set forth in this Agreement. "Date of Closing," "Closing Date" or "Closing"
shall mean the date upon which the deeds and documents given hereunder are
filed of record and the sale proceeds are available to Seller, and shall be
no more than fifteen (15) calendar days after the last day of the Inspection
Period, but in any event no later than December 1, 1997, assuming
substantially all documents and things specified in paragraphs 5(a)(i)-(xii)
are delivered to Buyer on or before September 26, 1997. Time is of the
essence in the performance of this Agreement.
8. COSTS AND PRORATIONS. The Seller shall be responsible for the
payment in full at Closing of any monetary encumbrances not to be assumed by
Buyer. Ad valorem real estate taxes and personal property taxes for the year
of Closing, rents, maintenance and service agreements, insurance, interest,
lender's tax and insurance reserves, water and other utilities, and all other
operating costs and revenues shall be prorated as of the Date of Closing.
Special assessment liens which are not recoverable from tenants shall be paid
by Seller at Closing. Buyer and Seller shall each pay one-half (1/2) of the
escrow fees. Seller shall pay the excise tax charged in connection with the
conveyance of the Property, together with the recording fee of any deed.
Buyer shall pay any use tax due in connection with the purchase of personal
property. Seller shall deliver to Buyer at Closing all deposits and prepaid
rent made under any leases assumed by Buyer.
9. RENT AND CAM.
(a) RENT AND CAM COLLECTION. Rents and common area maintenance
charges ("CAM charges") actually collected prior to Closing will be prorated as
of Closing. Any rents, taxes and CAM charges owed by tenants for any period
prior to Closing and unpaid at Closing shall remain the property of Seller,
provided, however, that except as provided in paragraph 9(b), Buyer shall
diligently attempt to collect such arrears for Seller's account for a period of
sixty (60) days
Real Estate Purchase and Sale Agreement - 8
after Closing. Buyer shall not be required to terminate a tenancy or evict a
tenant in order to collect rent owed to Seller. Rent, taxes and CAM charges
collected by Buyer after Closing from tenants who were in arrears on their
pre-closing obligations shall be applied first to payments owed to the Seller
for the pre-closing period, and the remainder paid to the Buyer.
(b) PERCENTAGE RENT. As soon after December 31, 1997 as possible
under the terms of the leases in question, Buyer and Seller shall calculate
the total percentage rent due for 1997 from tenants at the Property.
Percentage rent due in 1997 shall be prorated between Buyer and Seller on the
basis of the number of days in 1997 that each party owned the Property.
Within fifteen (15) days after collection of the 1997 percentage rent, Buyer
shall pay Seller its prorata share, taking into account any percentage rent
already paid to Seller for 1997.
(c) CAM RECONCILIATION. If it is not possible to accurately
reconcile CAM expenses for the Property and CAM collections from tenants at
the Property as of the Closing Date, Seller will prepare a good faith
estimated reconciliation as of Closing, and the parties will close on that
basis. The parties will thereafter prepare a final post-Closing
reconciliation of CAM expenses and collections as soon after Closing as
practicable. The amount by which CAM collections exceed CAM expenses for the
period prior to Closing shall be paid to Buyer, and the amount by which CAM
expenses exceed CAM collections for such period shall be paid to Seller. Any
payments due from Buyer or Seller as a result of the post-Closing
reconciliation shall be paid within fifteen (15) days of the reconciliation.
10. OPERATIONS; POSSESSION. Subject to paragraph 15 hereof, Seller
shall deliver the Property in substantially the same condition at Closing as
it was in at the time the inspection contingencies in paragraph 5 were
removed, ordinary wear and tear excepted. During the Inspection Period and
prior to Closing, Seller shall not enter into or modify any leases or
agreements affecting the Property without Buyer's written consent, which
consent shall not be unreasonably withheld or delayed. Buyer shall be
entitled to possession of the Property on the Date of Closing, subject to
existing tenancies.
11. TITLE INSURANCE AND TITLE. At Closing Seller shall pay for and
deliver to Buyer an ALTA standard form owner's policy of title insurance
naming Buyer as the insured, issued by First American Title Insurance Company
in an amount equal to the purchase price and containing no exceptions or
encumbrances other than those approved by Buyer pursuant to paragraph 4 and
this paragraph 11. If Buyer wishes to obtain extended coverage, Buyer shall
pay any additional premium for such extended coverage, and shall also pay the
cost of any
Real Estate Purchase and Sale Agreement - 9
survey which may be required by the title insurance company as a condition of
such coverage. At Closing Seller shall convey to Buyer good, marketable
title to the Property, free of all liens, encumbrances or defects except as
expressly approved or accepted by Buyer pursuant to paragraph 4 and this
paragraph 11. Title shall be conveyed by statutory warranty deed.
12. PERSONAL PROPERTY. This offer includes all appliances, furniture,
fixtures, and equipment now on the Property owned by Seller and used in the
operation of the Property, as well as all plans, permits, certificates,
studies and similar documents and rights in Seller's possession or available
to Seller at little or no cost. Title to the personal property shall be
transferred by xxxx of sale in the form attached hereto as Exhibit B, free
and clear of encumbrances except those approved by Buyer in paragraph 4 or
paragraph 11. Buyer and Seller shall attempt to agree as to that portion of
the Purchase Price attributable to the value of such personal property as of
the Closing Date, and if they are unable to agree, the value of the personal
property shall be the personal property tax assessment value.
13. ASSUMPTION OF LEASES AND CONTRACTS. At Closing, Buyer shall assume
all of Seller's obligations under the terms of each lease, contract and
agreement which Buyer was given copies of under the terms of subparagraph
5(a) above, by executing the Assumption Agreement attached hereto as Exhibit
C.
14. FIRPTA-TAX WITHHOLDING. If Seller is not a "foreign person" within
the meaning of the Foreign Investment in Real Property Tax Act, Seller agrees
to sign a certification to this effect at Closing. If Seller is a foreign
person and this transaction is not otherwise exempt from FIRPTA, the Closing
Agent shall withhold from the sales proceeds the required amount and pay it
to the Internal Revenue Service.
15. RISK OF LOSS. In the event of material loss of or damage to the
Property, or a portion thereof, prior to the Closing Date through casualty,
taking by eminent domain or otherwise, Buyer may terminate this Agreement and
all Escrow Deposits shall be refunded, or Buyer may elect to purchase the
Property in the condition existing at the Date of Closing. If Buyer elects
to purchase the Property, Seller shall assign to Buyer at Closing all
insurance proceeds and awards payable on account of the loss or damage as
Buyer's sole compensation for the loss or damage. Seller shall not in any
event be liable to restore the Property.
16. REPRESENTATIONS AND WARRANTIES OF SELLER. Seller hereby represents
and warrants to and covenants with Buyer as
Real Estate Purchase and Sale Agreement - 10
follows, which representations and warranties shall survive Closing:
(a) ORGANIZATION. Seller is duly organized and validly existing
and in good standing under the laws of the State of Washington;
(b) OWNERSHIP. Seller is the legal and equitable owner of the
Property, with full right to convey the same, and Seller has not granted any
option or right of first refusal or first opportunity to any party to acquire
any interest in any of the Property;
(c) BINDING OBLIGATIONS. This Agreement and all documents executed
by Seller which are to be delivered to Buyer at Closing are, and at the time
of Closing will be, legal, valid and binding obligations of Seller
enforceable against Seller in accordance with their respective terms; will be
sufficient to convey title; and will not violate any provisions of any
agreement or judicial order to which Seller or the Property is subject.
(d) HAZARDOUS SUBSTANCES. Except for substances stored, used or
disposed of in the normal course of business in accordance with all
applicable laws, regulations and ordinances, and except as disclosed to Buyer
in writing by Seller prior to the end of the Inspection Period, Seller has no
knowledge of (i) the presence, now or at any prior time, of any hazardous
substances located on the Property; (ii) the presence, now or at any prior
time, of any underground tank or vault on the Property; (iii) the use of the
Property for storage of oils, petroleum byproducts or other hazardous
materials; (iv) spills of any hazardous substance on the Property or from any
adjacent property onto the Property; (v) the use of asbestos or other
hazardous substances in the construction of any improvements located on the
Property; or (vi) any notice of any violation or claimed violation of any
law, rule or regulation relating to hazardous substances. As used herein,
"Seller's knowledge" means the actual knowledge of the officers of Seller's
general partners and Seller's property manager for the Property, Xxxxx Xxxxxx.
"Hazardous substances" shall mean and include any chemical, compound,
material, mixture, waste, or substance that is now or hereafter defined or
listed in, or otherwise classified pursuant to, any environmental laws as a
"hazardous substance," "hazardous material," "hazardous waste," "extremely
hazardous waste," "infectious waste," "toxic substance," "toxic pollutant" or
any other formulation intended to define, list, or classify substances by reason
of deleterious properties such as ignitability, corrosivity, reactivity,
carcinogenicity, or toxicity including any petroleum, natural gas, natural gas
liquids, liquefied natural gas, or synthetic gas
Real Estate Purchase and Sale Agreement - 11
usable for fuel (or mixture of natural gas and such synthetic gas).
"Hazardous substances" shall include, without limitation, any hazardous or
toxic substance, material or waste or any chemical, compound, or mixture
which is (i) asbestos, (ii) motor oil, gasoline, petroleum, or any petroleum
by-product, (iii) designated as a "hazardous substance" pursuant to Section
1317 of the Federal Water Pollution Control Act (33 U.S.C. Section 1251, ET
SEQ.), (iv) defined as a "hazardous waste" pursuant to Section 6903 of the
Federal Resource Conservation and Recovery Act, (42 U.S.C. Section 6901, ET
SEQ., (v) defined as "hazardous substances" pursuant to Section 9601 of the
Comprehensive Environmental Response, Compensation and Liability Act, 42
U.S.C. Section 9601, ET SEQ.,), or (vi) listed in the United States
Department of Transportation Table (49 CFR 172.101) or by the Environmental
Protection Agency as hazardous substances (40 CFR part 302); or in any and
all amendments thereto in effect as of the Closing Date; or such chemicals,
compounds, mixtures, substances, materials or wastes otherwise regulated
under any applicable local, state or federal environmental laws.
(e) DISCLAIMER. Seller makes no representations or warranties
regarding the Property or this transaction except as may be expressly set
forth in this Agreement. Seller shall not in any way be liable for or with
respect to the condition of the personal property, the Property or any
building, structures, or improvements thereon, their compliance with any
applicable building, zoning, land use or fire laws or regulations, or the
suitability of the Property for Buyer's intended use or for any use
whatsoever. Except as otherwise provided in this Agreement, Buyer is
purchasing the Property and the personal property "AS IS" and assumes the
responsibility and risks of all defects and conditions, including such
defects and conditions, if any, that cannot be observed by casual inspection.
Buyer has had or will have the opportunity prior to Closing to inspect the
Property and the personal property and will be relying entirely thereon and
on any consultant Buyer may retain.
(f) GOVERNMENTAL COMPLIANCE. Except as otherwise disclosed to
Buyer in writing, to Seller's knowledge (as defined in paragraph 16(d)
above), without any duty to investigate further, the Property and its current
use comply with all laws, rules and regulations related to sensitive areas,
zoning, building codes, energy codes, and energy conservation rules and
regulations. Seller has not received any written notices and neither the
officers of Seller's general partners nor Xxxxx Xxxxxx, Seller's property
manager, have received any oral notices that the Property or its current use
are in violation of the Americans with Disabilities Act, or other federal,
state or local laws which apply to the Property or its use, other than
violations which have been cured.
Real Estate Purchase and Sale Agreement - 12
17. REPRESENTATIONS AND WARRANTIES OF BUYER. Buyer hereby represents
and warrants to and covenants with Seller as follows, which representations
and warranties shall survive Closing:
(a) ORGANIZATION. Buyer is duly organized and validly existing and
in good standing under the laws of the state of its incorporation and is duly
authorized to transact business in the State of Washington;
(b) BINDING OBLIGATIONS. This Agreement and all documents executed
by Buyer which are to be delivered to Seller at Closing are, and at the time
of Closing will be, legal, valid and binding obligations of Buyer enforceable
against Buyer in accordance with their respective terms; and will not violate
any provisions of any agreement or judicial order to which Buyer is subject.
18. AGENCY DISCLOSURE. At the signing of this Agreement, Terranomics
Retail Services represented Seller only, and Buyer was not represented by a
real estate broker. Each party signing this Agreement confirms that prior
oral and/or written disclosure of agency and a copy of the pamphlet "The Law
of Real Estate Agency" was provided to it in this transaction. Seller has
agreed to pay Terranomics a commission of $215,000.00 pursuant to the terms
of a separate agreement and it shall be Seller's sole responsibility to pay
the commission.
19. ASSIGNMENT. Buyer may not assign this Agreement, or Buyer's rights
hereunder, without Seller's prior written consent, which consent shall not be
unreasonably withheld. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their permitted successors and assigns.
20. LIKE-KIND EXCHANGE. Either party may elect to sell/buy the Property
as part of a like-kind exchange under IRC Section 1031, by giving written
notice to the other party at least twenty (20) days prior to the Closing
Date, provided that: The non-exchanging party shall not incur any costs or
additional obligations as a result of the exchange; the exchange shall not
increase or decrease the amounts to be paid or received under the terms of
this Agreement; the closing on the exchange property shall occur
contemporaneously with the Closing provided for in this Agreement; and the
electing party shall indemnify and hold the other party harmless from any and
all liabilities, claims, losses or actions, including attorney's fees, which
the other party incurs or to which it may be exposed as a result of its
participation in the contemplated exchange. This Agreement is not subject to
or contingent upon the electing party's ability to effectuate an exchange.
In the event any desired exchange should fail to occur, for what-
Real Estate Purchase and Sale Agreement - 13
ever reason, the sale of the Property shall nonetheless be consummated as
provided herein.
21. DEFAULT. In the event the Buyer fails, without legal excuse, to
complete purchase of the Property, the entire $1,000,000 xxxxxxx money
deposit made by Buyer shall be forfeited to the Seller as the sole and
exclusive remedy available to the Seller for such failure. The failure of
this transaction to close because of Buyer's breach of its agreement to
purchase one of the Other Properties shall be a breach of this Agreement.
The parties understand and acknowledge that the Seller shall not have any
other remedies which would otherwise be available to Seller at law or in
equity as a result of such failure of the Buyer, and that the amount
forfeited will be paid to Seller regardless of whether the Seller incurs any
actual damages.
22. DEFAULT BY SELLER. After the Conditions are timely waived or
satisfied, if Seller neglects or refuses to timely close this transaction,
then Buyer (in Buyer's sole discretion) shall be entitled to the immediate
return of the xxxxxxx money deposit, additional xxxxxxx money deposit, and
all accrued interest, and shall also have the following options:
(a) Buyer may seek damages;
(b) Buyer may terminate this Agreement, and this Agreement will
become null, void, and of no further force or effect;
(c) Buyer may seek specific performance of this Agreement; or
(d) Buyer may seek any other remedy provided under applicable law.
The remedies given to Buyer are not exclusive but shall be cumulative with
and in addition to all remedies now or hereafter, at law or equity.
23. NOTICES. Any communication, notice, or demand of any kind
whatsoever that either party may be required or may desire to give to or
serve upon the other shall be in writing, addressed to the parties at the
addresses set forth below, and delivered by personal service, by Federal
Express or other reputable overnight delivery service, by facsimile
transmission, or by registered or certified mail, postage prepaid, return
receipt requested. Any such notice shall be deemed delivered as follows:
(a) if personally delivered, the date of delivery to the address of the
person to receive such notice; (b) if sent by Federal Express or other
reputable overnight delivery service, the date of delivery to the address of
the person to receive such notice; (c) if sent by facsimile transmission, on
the Business Day transmitted to the person to receive such notice; or (d) if
mailed, three (3)
Real Estate Purchase and Sale Agreement - 14
calendar days after depositing same in the mail. Any notice sent by
facsimile transmission must be confirmed by personally delivering or mailing
a copy of the notice sent by facsimile transmission. Any party may change
its address for notice by written notice given to the other.
24. NO WAIVER. No waiver of any of the provisions of this Agreement shall
be deemed, or shall constitute, a waiver of any other provision, whether or not
similar, nor shall any waiver constitute a continuing waiver. No waiver shall
be binding unless executed in writing by the party making the waiver.
25. FURTHER ACTS. Each party, at the request of the other, shall execute,
acknowledge (if appropriate), and deliver whatever additional documents, and do
such other additional acts, as may be reasonably required in order to accomplish
the intent and purposes of this Agreement.
26. APPLICABLE LAW; ATTORNEYS' FEES. This Agreement shall be governed
by the laws of the State of Washington and any question arising hereunder
shall be construed and determined according to such laws. In the event of
any controversy, claim or dispute between the parties hereto, arising out of
or relating to this Agreement or the breach hereof, including without
limitation any litigation or arbitration through all appeals, the prevailing
party shall be entitled to recover its reasonable expenses, costs and
attorneys' fees from the non-prevailing party.
27. ENTIRE AGREEMENT; ADDENDA. There are no oral or other agreements,
including but not limited to any representations or warranties, which modify
or affect this Agreement. This Agreement embodies the entire agreement
between the parties and supersedes all prior agreements and understandings,
if any, relating to the Property. This Agreement may be amended or
supplemented only by an agreement in writing executed by both parties to this
Agreement.
28. SURVIVAL OF WARRANTIES. All warranties, representations,
disclaimers, acknowledgments, covenants, rights and obligations contained
herein shall survive the recordation of the deed and the Closing of escrow.
29. DELIVERY OF DOCUMENTS TO SELLER. In the event that this transaction
does not close for any reason, Buyer shall return to Seller all of the
documents which Seller has delivered to Buyer for its review and evaluation
as part of its due diligence. Buyer shall also deliver to Seller, at no cost
to Seller, copies of all consultants' and experts' reports which Buyer has
obtained relating to the Property.
30. CONFIDENTIALITY. Each party will use good faith efforts to keep
confidential this Agreement, the terms of this transaction, and the matters
relating to the other party (or
Real Estate Purchase and Sale Agreement - 15
the other party's assets) disclosed in the course of this transaction (other
than information which is a matter of public knowledge or may be obtained
from sources readily available to the public). However, such matters may be
disclosed to either party's directors, officers, partners, attorneys,
accountants, consultants, agents and employees who are assisting in the
evaluation and completion of this transaction.
31. AUDIT RESPONSIBILITIES. From time to time, both before and after
Closing, Buyer may be engaged in financing and other transactions which will
require that both Buyer and the operation of the Property be audited as to
then current and past operations of the Property, including periods of time
during which Seller owned the Property. As a material inducement for Buyer
to enter into this Agreement, Seller agrees that upon written request of
Buyer, Seller shall render its timely and cooperative efforts to any such
auditors in delivering such responses to inquiries and information as is
within the knowledge or records of Seller with respect to the operations of
the Property or which is within the control or reasonable ability of Seller
to obtain, including, without limitation, operating statements and other
financial information relevant to the Property and its operations. In
addition to the foregoing, Seller shall sign and deliver to any such auditor,
such reasonable representations regarding the accuracy of the information and
documents provided to the auditor by Seller as may be requested by the
auditor. If the time or expenses which Seller is required to spend in
responding to and assisting the auditor can be provided at little or no cost
to Seller, Seller will bear those costs. If the time and expenses exceed
such amount, Buyer will pay Seller reasonable hourly rates for the time
incurred by Seller's employees in connection with the audit and will
reimburse Seller's expenses in connection with the audit.
32. COUNTERPARTS. This Agreement may be executed in any number of
identical counterparts which may contain the signatures of less than all the
parties but all of which shall be construed together as a single document.
The undersigned Buyer hereby offers and agrees to purchase the Property
for the price and upon the terms and conditions set forth in this Agreement.
BUYER:
PAN PACIFIC RETAIL PROPERTIES, INC.
By
---------------------------------
Xxxxxx X. Xxxx
Its President
Real Estate Purchase and Sale Agreement - 16
AND
By
--------------------------------
Xxxxx X. Xxxxxx
Its Executive Vice President
Address: 0000-X Xxxxx Xxxxxxx Xxxxx
Xxxxx, XX 00000
Telephone: (000) 000-0000
Fax: (000) 000-0000
DATE:
----------------------------------
SELLER:
MGMAB LIMITED PARTNERSHIP,
a Washington Limited Partnership
By SHER GP, INC., General Partner
By
--------------------------------
Its
------------------------------
Address: 000 - 000xx Xxx. X.X., Xxxxx 000
Xxxxxxxx, XX 00000
Telephone: (000) 000-0000
Fax: (000) 000-0000
DATE:
--------------------------------
Real Estate Purchase and Sale Agreement - 17
