Exhibit 99.1
PURCHASE AGREEMENT
(XXXXXX COMMONS)
THIS AGREEMENT, made this ___ day of May, 2005, by and between Rice Park
Associates, LLC, a Minnesota limited liability company ("Seller"), and Harvard
Property Trust, LLC, a Delaware limited liability company ("Buyer").
In consideration of the mutual covenants contained herein, Seller and
Buyer agree as follows:
1. PURCHASE AND SALE.
Subject to the agreements, covenants and conditions of this Agreement,
Seller agrees to sell to Buyer and Buyer agrees to purchase from Seller the
following property (collectively, "Property"):
a. REAL PROPERTY. Fee simple interest in that certain parcel of
real estate located at 000 Xx. Xxxxx Xxxxxx, Xx. Xxxx,
Xxxxxxxxx, commonly known as Xxxxxx Commons, legally described
on Exhibit A ("Land") together with all improvements thereon,
including fixtures, (collectively "Building") and together with
all easements and appurtenances of any nature to the Land
(collectively the "Real Property").
b. PERSONAL PROPERTY. All of the personal property situated in or
about the Real Property owned by the Seller and used in the
operation or maintenance of the Real Property described in
Exhibit B attached hereto ("Personal Property").
c. LEASES. Seller's interests as lessor in all of the leases and
licenses described in Exhibit C attached hereto ("Leases").
d. CONTRACTS. Seller's interests in the service and maintenance
contracts, equipment leases and other contracts regarding the
Real Property and the Personal Property described in Exhibit D
attached hereto ("Contracts").
e. PERMITS. Seller's interests in the permits, licenses and other
consents or approvals from governmental authorities or private
parties which relate to the Real Property.
f. WARRANTIES. Seller's interests in all warranties and guaranties
(express or implied) regarding the acquisition, construction,
design, use, operation, management or maintenance of the Real
Property and the Personal Property.
g. PLANS. A copy of the records set blueprints, plans and
specifications regarding the Real Property, and the Personal
Property to the extent available ("Plans").
h. RECORDS. Copies of the reports, studies and other documents
pertaining to the Real Property, Personal Property, Leases and
Contracts in the possession of Seller, and the copies of the
following records of Seller regarding the Real Property and the
Personal Property for the calendar years 2005, 2004, 2003 and
2002: records regarding management and leasing, real estate
taxes and assessments, insurance (including insurance loss
histories), tenants, maintenance, repairs, and capital
improvements and services ("Records").
i. INTANGIBLE PROPERTY. Seller's interest in all intangible
property associated with the use or operation of the Real
Property, including specifically, without limitation, the use of
all trade names, logos and websites in respect of the Real
Property ("intangible Property").
2. PURCHASE PRICE.
The total purchase price to be paid by Buyer for the Property shall be
Eighty-four million five hundred thousand and no/100 dollars ($84,500,000),
which shall be paid as follows:
x. XXXXXXX MONEY. Immediately upon execution of this Agreement,
Buyer shall wire transfer to Commercial Partners Title, LLC, 000
Xxxxx Xxxxx Xxxxxx, Xxxxx 0000, Xxxxxxxxxxx, Xxxxxxxxx ("Title
Company"), the amount of $500,000 xxxxxxx money ("Xxxxxxx
Money") which the Title Company shall deposit in an interest
bearing account until closing of the transaction or cancellation
of this Agreement. Interest accruing on the Xxxxxxx Money (and,
if applicable, the additional deposit made pursuant to Section
3) shall be deemed additional Xxxxxxx Money to be applied in the
same manner as the Xxxxxxx Money. The Xxxxxxx Money shall be
nonrefundable after May 20, 2005 in the absence of a default by
Seller or as otherwise expressly provided herein and shall be
applied towards payment of the Purchase Price at Closing or
shall be applied as otherwise expressly provided herein.
b. PURCHASE PRICE BALANCE. On or before noon (Dallas, Texas time)
on the Closing Date (as defined in Section 3), Buyer shall wire
transfer to the Title Company the amount of Eighty Four Million
Dollars ($84,000,000);
c. SHORTFALL ESCROW. Notwithstanding anything contained in this
Agreement to the contrary, the amount of Four Million Five
Hundred Thousand Dollars ($4,500,000) ("Shortfall Escrow") shall
not be disbursed to Seller at Closing but shall be held by Title
Company in "Permitted Investments and Accounts" and disbursed to
Seller or Buyer, as applicable, pursuant to an Office Lease
Agreement (the "Master Lease") to be agreed upon by the parties.
The parties shall endeavor in good faith to agree upon the form
of Master Lease as soon as practicable after the date of this
Agreement. Permitted Investments and Accounts shall mean money
market accounts, municipal bonds, and treasury notes and
certificates appropriate for principal preservation currently
yielding returns in a 3.5% to 4.0% range. The portfolio shall be
managed so as to preserve an appropriate level of liquidity. The
portfolio shall be subject to Buyer's approval not to be
unreasonably withheld on the foregoing criteria. In the event
that Seller and Buyer fail to agree upon the form of Master
Lease by 3:00 p.m. (Dallas, Texas time) on the second (2nd)
business day after the date of this Agreement, then either
Seller or Buyer may terminate this Agreement by written notice
to the other party, in which event the Xxxxxxx Money shall be
returned to Buyer.
d. ESCROW AGREEMENT. This Agreement shall constitute instructions
to Title Company who shall act as the escrow agent ("Escrow
Agent"). In the event any additional instructions to the Escrow
Agent shall conflict with the terms and provisions of this
Agreement, the terms and provisions of this Agreement shall take
precedence and shall control, unless such conflicting
instruction specifically recites an intention by the parties to
modify a specific term or provision of this Agreement.
3. CLOSING DATE.
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Closing for the transaction provided herein ("Closing") shall be on or
before 10:00 a.m. June 3, 2005 ("Closing Date") or such earlier date as may be
agreed to by the parties. Notwithstanding the foregoing, Buyer may extend the
Closing Date to a date not later than 9:00 a.m. June 13, 2005, by (a) delivering
to Seller, on or before June 1, 2005, written notice specifying a new Closing
Date (such date to be not later than June 13, 2005), and (b) delivering to Title
Company, on or before June 3, 2005, additional nonrefundable Xxxxxxx Money in
the amount of Fifty Thousand Dollars ($50,000) (which shall be applied towards
payment of the Purchase Price at Closing or as otherwise expressly provided
herein). Closing shall be held at the offices of Xxxxxx and Xxxxxx, P.A., 0000
XXX Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx. Buyer shall be entitled to possession of the
Real Property as of the Closing Date.
4. PRORATION OF RENT AND OPERATING COSTS.
Seller and Buyer agree to the following prorations and allocations of
rents and operating costs at Closing:
a. RENT. Basic rents ("Basic Rent") for the month of Closing shall
be prorated between Seller and Buyer as of the Closing Date
based upon Basic Rent actually collected. All prepaid Basic
Rent, and other income from the Property shall be credited to
Buyer at Closing, to the extent same is attributable to a period
of time after Closing.
b. DELINQUENT RENT. Basic Rent and additional rents constituting
reimbursement to Seller for common area maintenance charges,
property taxes, insurance and other operating expenses
("Additional Rent") which is delinquent and remains uncollected
at Closing shall not be prorated between Seller and Buyer at
Closing. At Closing, Seller shall furnish to Buyer a schedule of
delinquent Basic Rent and Additional Rent due under the Leases.
Buyer shall pay to Seller, Seller's prorata share of any
delinquent Basic Rent and Additional Rent if and when collected
by Buyer; provided, however, that Buyer shall have no obligation
to collect or pursue the collection of same. If Buyer fails to
collect any such deficiency within thirty (30) days of Closing,
Seller may collect such deficiency or pursue the collection of
the same. Buyer shall fully cooperate with (but shall not be
required to incur any expense with respect to) Seller's efforts
to collect deficient rent permitting Seller to bring such claim
in Buyer's name if necessary to pursue such claim; provided,
however, that Buyer shall not be required to terminate any lease
or evict any tenant. It is understood and agreed that any Basic
Rent or Additional Rent collected by Buyer after Closing shall
be applied first to deficient Basic Rent and Additional Rent in
the order in which such deficiency arose, earliest deficiencies
to be first paid. Buyer shall hold all landlord's liens in the
entireties thereof to enforce the payment of rentals to which
Buyer is entitled, and Seller shall be deemed to have
transferred to Buyer all of such landlord's liens.
c. OPERATING COSTS. All operating costs ("Operating Costs") related
to the Property excluding real estate taxes and installments of
special assessments of the Property will be allocated between
Seller and Buyer as of the Closing Date so that the Seller pays
that part of Operating Costs due and payable before the Closing
Date and Buyer pays that part of Operating Costs due and payable
from and after the Closing Date.
d. OPERATING COST ESCROW. Seller shall credit to Buyer at Closing
all amounts paid to Seller by tenants for the purpose of paying
Operating Costs then held by Seller. The amount of any such
assignment shall be credited against any amounts due and owing
by Seller under paragraph 4b of this Agreement. Buyer shall
indemnify, defend and hold harmless Seller from the claims of
any tenant related to such Operating Cost escrow payments made
by
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such tenant to the extent of such credit from Seller to Buyer.
If the amount of the Operating Costs collected by Seller and
credited to Buyer is less than Seller's Operating Cost
obligation under this Agreement, Seller shall not be required to
pay Buyer the amount of such deficiency to the extent such
deficiency can be recovered by Buyer from tenants pursuant to
future Operating Cost escrow payments or a year end assessment
by the Buyer under the terms of the leases assigned to Buyer,
subject to the provisions of Section 4.h below.
e. TAXES. Seller shall be responsible for payment at or prior to
Closing of all real estate taxes and other taxes due and payable
in 2004 and all prior years in respect of the Property. Buyer
shall be responsible for payment of all real estate taxes and
other taxes due and payable in 2006 and all subsequent years in
respect of the Property. Seller and Buyer shall prorate real
estate taxes and other taxes due and payable in 2005 on a
calendar year basis based on the day of Closing.
f. SPECIAL ASSESSMENTS. Special Assessments for maintenance or
other purposes which can be charged as an operating cost to
tenants shall be assumed by Buyer. Special Assessments which
cannot be charged as an operating cost to tenants shall be paid
by Seller at Closing.
g. SECURITY DEPOSITS. All security deposits and other deposits
payable to tenants under the Leases shall be credited to Buyer
at Closing.
h. RECONCILIATION. Seller and Buyer acknowledge and agree that
Additional Rent which Seller has heretofore collected from
tenants at the Property in respect of taxes and other operating
expenses ("Charges") during the period from January 1, 2005
through and including the Closing Date ("Seller's Reconciliation
Period"), have not yet been reconciled with tenants to the
extent Seller's recovery of such expenses from the tenants for
such period exceeded or was less than the actual amount of such
expenses for such period (the "Tenant Reconciliation"). In
connection with the Tenant Reconciliation, the parties agree
that (i) within a reasonable time after Closing, Seller shall
deliver to Buyer the data reasonably supporting the Charges
Seller collected from the tenants during Seller's Reconciliation
Period and the amount of Charges actually paid by Seller during
Seller's Reconciliation Period, and (ii) at the end of calendar
year 2005, Buyer shall prepare the final Tenant Reconciliation
(subject to Seller's approval with respect to Seller's
Reconciliation Period) in accordance with the terms and
conditions of the applicable Leases and, to the extent
applicable, either reimburse or xxxx tenants accordingly. If the
Tenant Reconciliation for Seller's Reconciliation Period shows
that amounts collected during Seller's Reconciliation Period
were more than the amount of Charges actually paid by Seller
during Seller's Reconciliation Period, then Seller shall pay
such amount to Buyer (to the extent Buyer did not receive a
credit therefor at Closing), and Buyer shall indemnify, defend
and hold harmless Seller for Buyer's failure to pay such
reimbursements to the tenants. If it is determined that a tenant
has underpaid to Seller any portion of the Charges for Seller's
Reconciliation Period, Buyer shall make good faith attempts to
collect the amount of any under-payment of such Charges from
such tenant, and shall, upon receipt, immediately deliver such
amount to Seller. The agreements of Seller and Buyer set forth
herein shall survive the Closing. Notwithstanding anything to
the contrary contained herein, Buyer shall have no rights or
claims with respect to the Tenant Reconciliation for calendar
year 2004 and Seller shall be entitled to collect such amounts
directly from Tenants by any legal means and Seller
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shall also be responsible to reimburse Tenants to the extent of
any over-payment of Charges actually received by Seller for
calendar year 2004.
i. ADJUSTMENT. The prorations described in this Section 4 shall be
made as of 12:01 a.m. on the Closing Date, as if Buyer were
vested with title to the Property during the entire day upon
which Closing occurs. All prorations described in this Section 4
shall be effected by increasing or decreasing, as the case may
be, the amount of cash to be paid by Buyer to Seller at Closing.
Seller and Buyer agree to adjust between themselves after
Closing any errors or omissions in the prorations made at
Closing; provided, however, that such prorations shall be deemed
final and not subject to further post Closing adjustments if no
such adjustments have been requested within one (1) year after
the Closing Date.
5. CONDITIONS TO CLOSING.
All obligations of Buyer under this Agreement are subject to the
fulfillment of each of the following conditions, as well as any other conditions
contained elsewhere in this Agreement, any of which may be waived in writing by
Buyer:
a. TRUE REPRESENTATIONS AND WARRANTIES. The representations and
warranties of Seller contained in this Agreement shall be true
as of the Closing Date.
b. DOCUMENTS DELIVERED AND OBLIGATIONS PERFORMED. All documents
required to be delivered to Buyer pursuant to the terms of this
Agreement at or prior to the Closing shall have been delivered
in form required hereunder and all obligations required to be
performed by Seller at or prior to the Closing pursuant to the
terms of this Agreement shall have been performed by Seller.
c. ZONING, RESTRICTIONS AND ACCESS. Buyer shall be satisfied, in
Buyer's sole discretion, that applicable zoning laws, ordinances
and recorded restrictions, if any, permit use of the Real
Property for the general office and retail purposes for which it
is currently used and that ingress and egress to public
thoroughfares will be adequate for Buyer's needs.
d. UTILITIES. Buyer shall be satisfied, in Buyer's sole discretion,
that all utility services necessary for the current use of the
Property are available to Buyer at the Real Property, including
but not limited to gas, electricity, water and storm and
sanitary sewer.
e. INSPECTION OF IMPROVEMENTS. Buyer shall have inspected and
approved the physical condition of the Property, including all
mechanical and utility systems included therein and Buyer shall
be satisfied, in Buyer's sole discretion, with the results of
such inspections.
f. APPROVAL OF FINANCIAL STATEMENTS. Buyer shall have reviewed and
approved the financial statements of the Property described
below and Buyer shall be satisfied, in Buyer's sole discretion,
with the financial statements.
g. ENVIRONMENTAL. Buyer shall have reviewed any environmental
audits of the Property delivered to Buyer from Seller or any
contractor engaged by Buyer, and Buyer shall be satisfied, in
Buyer's sole discretion, with such environmental audits.
If the contingencies described in Section 5.a and 5.b (the "Closing Date
Conditions") are not satisfied as of the Closing Date, or if the contingencies
described in Sections 5.c through 5.g (the
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"Contingency Date Conditions") are not satisfied by 5:00 p.m. on May 20, 2005
(the "Contingency Date"), then Buyer may, in its sole discretion and at Buyer's
sole option, terminate this Agreement by sending written notice to Seller at
Closing (in the case of the Closing Date Conditions) or within one (1) business
day after the Contingency Date (in the case of the Contingency Date Conditions).
If Buyer terminates this Agreement as provided herein, Title Company shall
return all Xxxxxxx Money to Buyer within three (3) business days of delivery of
said notice. If Buyer does not terminate the Agreement as provided herein, the
Xxxxxxx Money will be deemed nonrefundable (in the absence of Seller's default
or as otherwise expressly provided herein) and shall either be applied against
the purchase price at Closing or otherwise as expressly provided herein.
6. PRECLOSING DOCUMENTS.
As soon as possible after the date of this Agreement, but in no event
later than five (5) days after the date of this Agreement, Seller shall furnish
Buyer with the following (and will thereafter provide to Buyer any additional
information regarding the Property that Buyer may reasonably request):
a. FINANCIAL STATEMENTS. Accurate financial statements of the
Property for the period from 2002 through the most recently
completed calendar month as of the date of this Agreement, which
statements have been prepared by Seller in the normal course of
such Seller's business and are used by Seller in Seller's normal
operation and management of the Property. Such financial
statements shall include statements relating to any owner
association in respect of the Property or any parking operations
of Seller.
b. AGREEMENTS. Leases, Contracts, Permits, Warranties, Plans,
Records and documents evidencing any Intangible Property, as
described in paragraph 1.
c. SURVEYS, SOIL TESTS, REPORTS, AND DEVELOPMENT PLANS. A copy of
the surveys, structural reports, property condition reports,
environmental tests and reports, soil tests and reports,
building plans, and other reports and studies in respect of the
Property that are in Seller's possession and relate to the Real
Property.
d. RENT ROLL. A rent roll setting forth the names of each tenant,
the commencement and termination date of each tenant's lease,
the base rent, and any options to extend the lease.
7. SELLER'S OBLIGATIONS AT CLOSING.
At the closing, Seller shall deliver or execute, acknowledge (where
appropriate), and deliver to Buyer the following (the forms of the conveyance
documents described below to be reasonably satisfactory to Seller and Buyer):
a. DEEDS. Recordable, Minnesota Statutory form, special warranty
deed, from Seller which conveys the Real Property to Buyer. The
state deed tax payable upon recording the deed shall be paid by
Seller.
b. XXXX OF SALE. A warranty xxxx of sale conveying the Personal
Property to Buyer free and clear of all encumbrances.
c. ASSIGNMENT OF LEASES. An assignment of leases conveying the
Leases and any security deposits, prepaid rents or collections
and guaranties regarding the Leases to Buyer, free and clear of
all encumbrances.
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d. ASSIGNMENT OF CONTRACTS. An assignment of Contracts conveying
with warranties the Contracts to Buyer, free and clear of all
encumbrances, together with the consent of all parties having a
right to consent to such assignment.
e. ASSIGNMENT OF PERMITS. An assignment of Permits conveying with
warranties the Permits to Buyer free and clear of all
encumbrances, together with the consent of all parties having a
right to consent to such assignment.
f. ASSIGNMENT OF WARRANTIES AND INTANGIBLE PROPERTY. An assignment
of Warranties and Intangible Property to Buyer conveying with
warranties the Warranties and Intangible Property to Buyer, free
and clear of all encumbrances, together with the consent of all
parties having a right to consent to such assignment. Seller
agrees to complete any documentation and pay any fee less than
$2,500 that may be required by a warrantor order to consummate
an assignment of a Warranty.
g. TENANT ESTOPPEL CERTIFICATES. Estoppel certificates in the form
attached as Exhibit E from Xxxxxx Associates, Inc. ("LA") and
Restaurants Unlimited ("RU"), which certificates shall disclose
no facts which are material and contradictory to those facts
previously disclosed in the Rent Roll or which are material to
Buyer's acquisition of the Property, and shall confirm the rents
payable by such tenant and the other matters set forth in
Exhibit E. For purposes of the preceding sentence an exception,
qualification or modification of an estoppel certificate shall
be deemed "material" if such exception, qualification or
modification diminishes the value of the Property by more than
Fifty Thousand Dollars ($50,000).
Seller shall use its best efforts to obtain estoppel
certificates in the form of Exhibit E from St. Xxxx Fire and
Marine Insurance Company ("St. Xxxx") and the other tenants in
the Building; provided Seller shall not be required to expend
significant moneys or make significant concessions in order to
obtain such estoppel certificates. Seller shall deliver each
estoppel to Buyer (regardless of whether it complies with this
Agreement) promptly following Seller's receipt thereof. If St.
Xxxx shall fail to deliver an estoppel certificate, Seller shall
deliver at closing an estoppel certificate signed by Seller
representing the same facts as that tenant would have
represented in the missing estoppel certificate, and the
delivery of such certificate shall satisfy this condition. If
Seller obtains an estoppel certificate from St. Xxxx after
Closing, Seller shall deliver such estoppel certificate to Buyer
within seven (7) days of obtaining such estoppel certificate.
h. NOTICES TO TENANTS. Notices to the tenants under the Leases, in
form reasonably satisfactory to Buyer, advising them of the sale
of the Property and directing them to make future lease payments
to Buyer at the place designated by Buyer.
i. MASTER LEASE. Two copies of the Master Lease fully executed by
Seller.
j. FIRPTA AFFIDAVIT. An affidavit in recordable form containing
such information as is required by Internal Revenue Code Section
1445(b)(2) and regulations issued pursuant thereto.
k. AFFIDAVITS OF SELLER. Standard form affidavits executed by
Seller affirming on the date of closing there are no outstanding
or unsatisfied dissolutions, judgments, tax liens, bankruptcies
or mechanic's liens against or involving Seller or the Property,
that there has been no skill, labor or material furnished to the
Real Property for which payment has not
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been made or for which mechanics' liens could be filed; and that
there are no unrecorded contracts, parties in possession, or
boundary line disputes of which each Seller has knowledge.
l. PAYOFF STATEMENTS. Current statements from the mortgagee or
holder of any security interest in the Property stating the
principal balance, accrued interest as of the date thereof and
per diem interest required for full satisfaction of the debt
secured thereby.
m. ORIGINAL DOCUMENTS. All original copies of the Leases,
Contracts, Permits, Warranties, Plans and Records.
n. CERTIFICATE(S) OF OCCUPANCY. One or more certificates of
occupancy issued by the appropriate governmental body
authorizing the use of the Real Property for the purposes for
which it is now used.
o. PAYMENT TO XXXXXX ASSOCIATES. At Closing, Seller shall pay to
Xxxxxx Associates all amounts due to Xxxxxx Associates pursuant
to Article 16 of Exhibit E of the Lease with Xxxxxx Associates.
p. MISCELLANEOUS. Such other documents as are reasonably necessary
or appropriate to effect the consummation of the transactions
contemplated by this Agreement.
8. BUYER'S OBLIGATIONS AT CLOSING.
Subject to the terms and conditions hereof, and contemporaneously with
the performance by Seller of their obligations, Buyer shall deliver or execute,
acknowledge (where appropriate), and deliver at closing the following:
a. CASH. The amount due at closing in cash, by certified check or
by wire transfer pursuant to written instructions provided by
Seller prior to the closing.
b. ASSUMPTION AGREEMENT. An assumption agreement pursuant to which
Buyer will assume all obligations of Seller under the Leases,
Contracts, and Permits that accrue after the date of closing.
c. MASTER LEASE. Two copies of the Master Lease fully executed by
Buyer.
d. MISCELLANEOUS. Such other documents as are reasonably necessary
or appropriate to effect the consummation of the transactions
contemplated by this Agreement.
9. SELLER'S REPRESENTATIONS.
In addition to those representations and warranties appearing in other
paragraphs of this Agreement, Seller represents and warrants to Buyer that:
a. BINDING AGREEMENT. Seller is a limited liability company duly
organized, validly existing and in good standing under the laws
of the State of Minnesota and that no other actions or
proceedings are or will be required to be taken by such Seller
or any other person or entity, public or private, to make this
Agreement a valid and binding obligation of such Seller, to
fully authorize the transaction contemplated by this Agreement
and upon
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consummation of the transaction contemplated by this Agreement
to vest the Property in Buyer free and clear of all liens,
encumbrances, security interests and adverse claims.
b. LITIGATION AND GOVERNMENT PROCEEDINGS. To the best of Seller's
knowledge, without making inquiry, there is no litigation,
proceeding (eminent domain, rezoning, building moratorium or
otherwise), or claim, pending or threatened, which might result
in liability on the part of Buyer.
c. USE OF REAL PROPERTY. To the best of Seller's knowledge, without
investigation, the Real Property is usable for its current uses
without violating any federal, state, local or other
governmental building or zoning law, ordinance or regulation, or
any applicable private restriction, and such use is a legal
conforming use.
d. UTILITIES. Seller has received no notice of actual or threatened
reduction or curtailment of any utility service now supplied to
the Real Property.
e. ASSESSMENTS. Seller has received no notice of actual or proposed
special assessments to be levied against the Real Property.
f. RIGHTS CONCERNING THE PROPERTY. To the best of Seller's
knowledge, there are no contracts, unrecorded easements,
covenants or restrictions or agreements of any kind or
description, either written or verbal, which burden the Property
as of the date hereof, except as disclosed in writing to Buyer
prior to the Contingency Date. Seller has completed performance
of all obligations it may have owed tenants of the Property
under agreements other than the leases, including specifically,
without limitation, any agreement pertaining to the development,
construction or financing of the Property.
g. RIGHTS OF OCCUPANCY. There are no rights of use or occupancy for
any portion of the Real Property now in effect or to come into
effect other than as owned by Seller and disclosed in writing to
Buyer prior to the Contingency Date, and Seller shall not enter
into, extend, or renew any lease agreement covering any space in
or on the Real Property without the prior written approval of
Buyer.
h. CERTIFICATES OF OCCUPANCY. Seller has received no notice of
actual or threatened cancellation or suspension of any
certificates of occupancy for any portion of the Real Property.
i. LEASES. Seller has made available to Buyer a correct and
complete copy of each Lease and all its amendments. The
information regarding the Leases contained in attached Exhibit C
is correct and complete as of the date of this Agreement. The
Leases are in full force and neither Seller, nor any tenant, is,
to the best of each Seller's knowledge, in default under the
Leases except as indicated on Exhibit C. There are no other
leases or possessory rights of others regarding the Real
Property.
j. CONTRACTS. Seller has made available to Buyer a correct and
complete copy of each Contract and its amendments. To the best
of each Seller's knowledge, the Contracts are in full force and
neither Seller, nor any other party to the Contracts, is in
default under the Contracts. All other contracts in effect
regarding the Property are terminable on or before the Closing
Date.
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k. PERMITS. Seller has made available to Buyer a correct and
complete copy of each Permit and its amendments. To the best of
each Seller's knowledge, without inquiry, the permits are in
full force, and Seller are not in default under the Permits. To
the best of each Seller's knowledge, without inquiry, no other
permits are required from any governmental entity in order to
operate the Property as it is now operated.
l. FINANCIAL STATEMENTS. The financial statements for the Property
that have been supplied by each Seller to Buyer are correct and
complete in all material respects and have been prepared on a
tax basis.
m. AGENTS AND EMPLOYEES. No management agents or other personnel
employed in connection with the operation of the Property have
the right to continue such employment after the Closing Date
other than as required herein.
n. OPERATION PRIOR TO CLOSING. Seller shall manage and operate the
Property in the ordinary course of business between the date
hereof and the date of Closing. During such period, Seller shall
maintain present services and insurance policies and shall
perform when due all of Seller's obligations under the Leases
and other contracts affecting the Property or required by law.
Prior to the date of Closing, Seller shall not enter into any
Lease or other agreement or contract in respect of the Property
and shall not incur any major expenses relating to the Property
without Buyer's prior written consent. After the date hereof and
prior to Closing, no part of the Property, nor any interest
therein, will be alienated, liened encumbered or otherwise
transferred.
o. AUDIT. Buyer has advised Seller that, after Closing, Buyer must
cause to be prepared up to three (3) years of audited financial
statements in respect of the Property in compliance with the
policies of Buyer and certain laws and regulations, including,
without limitation, Securities and Exchange Commission
Regulation S-X, Rule 3-14. Seller agrees to use reasonable
efforts to cooperate with Buyer's auditors in the preparation of
such audited financial statements (it being understood and
agreed that the foregoing covenant shall survive the Closing).
Without limiting the generality of the preceding sentence (i)
Seller shall, during normal business hours, allow Buyer's
auditors reasonable access to such books and records maintained
by Seller (and Seller's manager of the Property) in respect of
the Property as necessary to prepare such audited financial
statements; (ii) Seller shall use reasonable efforts to provide
to Buyer such financial information and supporting documentation
as are necessary for Buyer's auditors to prepare audited
financial statements; (iii) Seller will make available for
interview by Buyer and Buyer's auditors the manager of the
Property or other agents or representatives of Seller
responsible for the day-to-day operation of the Property and the
keeping of the books and records in respect of the operation of
the Property; and (iv) if Seller has audited financial
statements with respect to the Property, Seller shall promptly
provide Buyer's auditors with a copy of such audited financial
statements. If after the Closing Date Seller obtains an audited
financial statement in respect of the Property for a fiscal
period prior to the Closing Date that was not completed as of
the Closing Date, then Seller shall promptly provide Buyer with
a copy of such audited financial statement, and the foregoing
covenant shall survive Closing. In addition, Seller shall
provide Buyer promptly with such other documents and information
regarding the Property as Buyer may reasonably request.
For purposes of the above representations "to the best of Seller's Knowledge"
means the actual knowledge of Xxxx Xxxxxxxxx or Xxxxx Xxxxx, the individuals
primarily responsible in the management of the Property.
10
As a material inducement to Seller to execute this Agreement, Buyer
acknowledges, represents and warrants that, except as otherwise expressly set
forth in this Agreement, upon the satisfaction or waiver of the conditions set
forth in Section 5, (i) Buyer will have fully examined and inspected the
Property, including the construction, renovation, operation and leasing of the
Property, together with such documents and materials with respect to the
property which Buyer deems necessary or appropriate in connection with its
investigation and examination of the Property, (ii) Buyer will have accepted and
will be fully satisfied in all respects with the foregoing and with the physical
condition, value, presence or absence of hazardous materials, use, leasing,
operation, tax status, income and expenses of the Property, (iii) the Property
will be purchased by Buyer "AS IS" and "WHERE IS" and with all faults and, upon
closing, Buyer shall assume responsibility for the physical condition of the
Property, and (iv) Buyer will have decided to purchase the Property solely on
the basis of its own independent investigation. Except as expressly set forth
herein or in any documents executed by Seller and delivered to Buyer pursuant to
Section 7 ("Seller' Documents"), Seller has not made, does not make, and has not
authorized anyone else to make any representation as to the present or future
physical condition, value, presence or absence of hazardous materials, financing
status, leasing, operation, use, tax status, income and expense or any other
matter or thing pertaining to the Property, and Buyer acknowledges that no such
representation or warranty has been made and that in entering into this
Agreement, it does not rely on any representation or warranty other than those
expressly set forth in this Agreement or in Seller' Documents. EXCEPT AS
EXPRESSLY SET FORTH IN THIS AGREEMENT OR IN SELLER'S DOCUMENTS, SELLER MAKES NO
WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED OR ARISING BY OPERATION OF LAW,
INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF CONDITION, HABITABILITY,
MERCHANTABILITY, OR FITNESS FOR A PARTICULAR PURPOSE OF THE PROPERTY, AND BUYER
HEREBY RELEASES SELLER FROM ALL CLAIMS RELATING TO THE CONDITION OF THE PROPERTY
EXCEPT FOR CLAIMS THAT SELLER HAS BREACHED AN EXPRESS WARRANTY SET FORTH IN THIS
AGREEMENT OR MADE AN EXPRESS WRITTEN MISREPRESENTATION IN THIS AGREEMENT
CONCERNING THE PROPERTY. Seller shall not be liable for or bound by any verbal
or written statements, representations, real estate broker's information
pertaining to the Property furnished by any real estate broker, agent, employee,
servant or any other person unless the same are specifically set forth in this
Agreement or in Seller' Documents. The provisions of this paragraph shall
survive the closing.
All representations and warranties of Seller concerning the Property
shall expire and be null and void as of the first anniversary of the Closing
Date ("Termination Date"). Buyer shall not be permitted to commence a legal
claim based on the above representations and warranties on or after the
Termination Date, time being of the essence.
10. BUYER'S REPRESENTATIONS.
a. WORK ON PROPERTY. Prior to closing, Buyer shall not, without
Seller' prior written consent, perform or cause to be performed
any work other than customary repairs and maintenance for which
the provider would be entitled to a lien upon the Real Property.
Seller may withhold such consent if, in Seller' sole discretion,
Buyer fails to demonstrate Buyer's financial ability to pay for
such work.
b. MANAGEMENT AGREEMENT. After acquisition of the Property, Buyer
intends to retain HPT TIC Management Services LP, a Texas
limited partnership ("HPT Management") to manage and lease the
Property. At Closing, Buyer shall cause HPT Management to join
with Frauenshuh Companies ("Frauenshuh") in execution of a
subcontract ("Management Subcontract") for the management and
leasing of the Property whereby Frauenshuh will manage and lease
the Property (i) for a term of six (6) years, subject to such
termination events and renewal provisions as may be agreed upon
by HPT Management and
11
Frauenshuh. The parties shall endeavor in good faith to agree
upon the form of Management Subcontract as soon as practicable
after the date of this Agreement. In the event that Seller and
Buyer fail to agree upon the form of Management Subcontract by
3:00 p.m. (Dallas, Texas time) on the second (2nd) business day
after the date of this Agreement, then either Seller or Buyer
may terminate this Agreement by written notice to the other
party, in which event the Xxxxxxx Money shall be returned to
Buyer.
11. SELLER'S WARRANTY OF TITLE.
Subject to performance by Buyer, Seller agrees to execute and deliver a
special warranty deed conveying marketable title to the Real Property subject
only to the following exceptions:
a. Building and zoning laws, ordinances, state and federal
regulations.
b. Utility and drainage easements which do not interfere with the
present use of the Real Property.
c. Any items referenced on Schedule B of the Commitment (as
hereafter defined in Section 12 herein) to which Buyer fails to
make timely objection pursuant to Section 12 herein.
12. OBLIGATIONS OF SELLER AND BUYER AS TO TITLE MATTERS.
It is understood and agreed that the title herein required to be
furnished to the Real Property by the Seller shall be marketable of record and
that marketability shall be determined as of the closing date. Seller agrees to
record all documents necessary to show of record a marketable title in Seller.
a. TITLE INSURANCE COMMITMENT. Within two (2) days after the date
of this Agreement, the Seller will deliver to the Buyer, without
expense to the Buyer, a commitment ("Commitment") for an owner's
extended coverage policy of title insurance for the Real
Property, ALTA Form B (1992) dated a current date and issued by
(the Title Company). Such title insurance commitment shall be in
the amount of the purchase price and shall commit to insure
Buyer's ownership of fee title to the Real Property. The
Commitment shall have attached copies of all instruments of
record which create any easements or restrictions which are
referred in Schedule B of the Commitment. Seller shall pay at
closing the cost of preparing the Commitment and the Buyer shall
pay at closing the premiums for the policies of title insurance
which are issued pursuant to the Commitment.
b. SURVEY. Within two (2) days after the date hereof, the Seller,
at its cost, will provide to the Buyer a survey of the Real
Property, certified currently to the Buyer, in the form required
by the Title Company (as defined in Section 12 herein) in order
to remove the survey exception from the Commitment (as defined
in Section 12a herein). The survey shall be prepared in
accordance with standards applicable to registered and licensed
land surveyors making surveys in the State of Minnesota.
c. EXAMINATION OF TITLE. The Buyer shall be allowed two (2)
business days after the later of (1) the date of this Agreement,
or (2) receipt of the survey and commitment for title insurance,
for examination of title and the making of and objections
thereto, said objections to be made in writing or deemed to be
waived.
12
d. OBJECTIONS, TITLE CORRECTIONS AND REMEDIES.
(1) PERIODS TO CURE OBJECTIONS AND CLOSE. If any objections
are so made, the Seller shall be allowed fifteen (15)
days from the date of Buyer's written objections to make
such title marketable including obtaining a commitment
from Title Company or Lawyers Title Insurance
Corporation to cover any title risk to Buyer. Pending
correction of title, the payments hereunder required and
the Closing Date shall be postponed, but upon correction
of title and within two (2) business days after written
notice, the Buyer shall perform this agreement according
to its terms.
(2) TITLE FOUND MARKETABLE. If the title to the Real
Property be found marketable or be so made within
fifteen (15) days from the date of Buyer's objections,
and Buyer shall default in any of the terms of this
Agreement then in that case Seller may, at its option,
enforce any of Seller's remedies as described in Section
18.
(3) TITLE NOT MADE MARKETABLE. If said title is not made
marketable within said fifteen (15) day period, then
Buyer, at its option may:
(a) Terminate this Agreement by written notice to
Seller, in which event the Title Company shall
promptly refund the Xxxxxxx Money to Buyer and
neither Seller nor Buyer shall have any further
remedies or causes of action against the other;
or
(b) Waive the objection to marketability of title
and proceed to closing within two (2) days of
the expiration of such 10-day period.
e. TITLE INSURANCE COSTS.
(1) TITLE INSURANCE. Seller shall pay for the cost of
preparing a title insurance commitment. Buyer shall pay
the title insurance premium.
(2) CLOSING FEE. Seller and Buyer shall each pay one-half
any reasonable and customary escrow and/or closing fee
charged by the Title Company.
(3) STATE DEED TAX. Seller shall pay all documentary stamp
taxes or other transfer fees regarding the Deed to be
delivered by Seller under this Agreement.
13. HAZARDOUS MATERIALS.
(a) To Seller's actual knowledge without inquiry or
investigation, and except as may have been
disclosed in writing to Buyer by Seller or by
any environmental reports obtained by Buyer on
or before the Contingency Date: (i) Seller has
not used the Subject Property for the
generating, transporting, treating, storage,
manufacture, emission of or disposal of any
reportable quantities of Hazardous Materials
(defined below) in violation of applicable
Environmental Laws (defined below), (ii) there
have been no investigations or reports involving
the Subject Property by any governmental
authority which pertain to a violation of
applicable Environmental Laws, (iii) no person,
private or governmental agency or entity has
given any written notice to Seller of or
asserted any written
13
claim, cause of action, penalty, cost or demand
against Seller for payment or cause of action,
penalty, cost or demand against Seller for
payment or compensation involving any injury or
threatened injury to human health, the
environment or natural resources resulting or
allegedly resulting from any activity or event
described in (i) above, (iv) there are not now,
nor have there been in the past, any actions,
suits, proceedings or damage settlements against
Seller related in any way to Hazardous Materials
in, upon, under, over or from the Subject
Property in violation of law, (v) Seller shall
give Buyer prompt written notice if Seller
receives prior to Closing any written notice
with regard to a violation of Environmental Laws
resulting from Hazardous Materials on, from or
affecting the Subject Property. For purposes of
this subsection, "Seller's actual knowledge"
means the actual knowledge of Xxxx Xxxxxxxxx or
Xxxxx Xxxxx, the primary managers of the
Property. All representations made above
concerning the Property shall expire and be null
and void as of the first anniversary of the
Closing Date "Termination Date." Buyer shall not
be permitted to commence a legal claim based on
the above representations on or after the
Termination Date, time being of the essence.
(b) For purposes of this Agreement, the following
terms have the following meanings:
(i) "Hazardous Materials" means
polychlorinated biphenyls, petroleum, flammable
explosives, radioactive materials, asbestos,
asbestos containing materials, radon gas and any
hazardous, toxic or dangerous waste, pollutant,
contamination, substance or material defined as
such in (or for purposes of) the Environmental
Laws or which is listed as such by the
Environmental Protection Agency.
(ii) "Environmental Laws" means any current
federal, state, or local law, regulation or
ruling applicable to environmental conditions
on, under or about the Subject Property,
including, without limitation, the Comprehensive
Environmental Response, Compensation and
Liability Act (CERCLA), the Resource
Conservation and Recover Act, the Toxic
Substances Control Act and the Clean Water Act
and any similar local or state law.
b. "HAZARDOUS SUBSTANCES" means a substance or waste, designated as
hazardous or toxic in Section 101 of the Comprehensive
Environmental Response and Liability Act, as amended, 42 U.S.C.
ss. 9601.
c. NO WARRANTY. In connection with Hazardous Substances, Buyer
acknowledges that Buyer has fully examined the Property and that
it is buying the Property "As Is" relying solely on Buyer's own
judgment, discretion and investigation and that of professional
engineers and consultants which have made environmental audits
certified on behalf of Buyer. EXCEPT AS OTHERWISE EXPRESSLY
PROVIDED IN THIS AGREEMENT, SELLER MAKES NO REPRESENTATIONS OR
WARRANTIES EXPRESS OR IMPLIED RELATING TO HAZARDOUS SUBSTANCES
IN OR ON THE PROPERTY AND EXPRESSLY DISCLAIMS ANY SUCH
REPRESENTATIONS OR WARRANTIES MADE BY ANY AGENT,
14
CONTRACTOR, EMPLOYEE OR OTHER PERSON, AND BUYER HEREBY RELEASES
SELLER FROM ANY CLAIM OF WHATEVER NATURE RESULTING FROM THE
PRESENCE OF HAZARDOUS SUBSTANCES IN OR ON THE PROPERTY AND ANY
ALLEGED MISREPRESENTATION OR WARRANTY OR ALLEGED DUTY TO MAKE A
DISCLOSURE WITH RESPECT TO HAZARDOUS SUBSTANCES IN OR ON THE
PROPERTY.
14. REAL ESTATE BROKERAGE COMMISSION; DISCLOSURE OF AGENT.
It is agreed and understood by Seller and Buyer that there are no real
estate commissions, finders fees, or other payments of any kind due or owing to
any person regarding the sale of the Property except that Seller has retained
Frauenshuh Companies as a broker and shall be solely liable for any commission
owed to Frauenshuh Companies. Seller agrees to indemnify and hold Buyer harmless
from any demands, claims or payments in the event any person claims any real
estate commissions, fees or payments from Buyer other than those resulting from
an alleged contract with Buyer. Buyer agrees to indemnify and hold Seller
harmless from any demands, claims or payments in the event any person claims any
real estate commissions, fees or payments resulting from a contract with Seller.
15. DAMAGE.
If, prior to the closing date, all or any part of the Property is
substantially damaged by fire, casualty, the elements or any other cause, Seller
shall immediately give notice to Buyer of such fact and at Buyer's option (to be
exercised within ten (10) business days after such Seller's notice), this
Agreement shall terminate, in which event neither party will have any further
obligations under this agreement and the Xxxxxxx Money, together with any
accrued interest, shall be refunded to Buyer. If Buyer fails to elect to
terminate despite such damage, or if the Property is damaged but not
substantially, Seller shall perform the prompt repair of such damage or
destruction and the return of the Property to its condition prior to such
damage. If such damage shall be completely repaired prior to the Closing Date
then there shall be no reduction in the purchase price, and Seller shall retain
the proceeds of all insurance related to such damage. If such damage shall not
be completely repaired prior to the Closing Date but Seller is diligently
proceeding to repair, then Seller shall complete the repair after the Closing
Date and shall be entitled to receive the proceeds of all insurance related to
such damage after repair is completed; provided, however, Buyer shall have the
right to delay the Closing Date until repair is completed. If Seller shall fail
to diligently proceed to repair such damage, then Buyer shall have the right to
require closing to occur and the purchase price (and specifically the cash
portion payable at the Closing Date) shall be reduced by the cost of such
repair, or at Buyer's option, Seller shall assign to Buyer all right to receive
the proceeds of all insurance related to such damage and the purchase price
shall remain the same (except that Buyer shall receive a credit of the amount of
any deductible under the applicable insurance policy). For purposes of this
paragraph, the words "substantially damaged" means damage that would cost
$1,000,000 or more to repair.
16. RISK OF CONDEMNATION PRIOR TO CLOSING.
All risk of condemnation of the Property prior to the closing shall be
on Seller. If after the effective date hereof and prior to the closing all or a
material part of the Property is subjected to a bona fide threat of condemnation
by a body having the power of eminent domain or is taken by eminent domain or
condemnation, Buyer may, by written notice to Seller, elect to cancel this
agreement prior to the closing hereunder, in which event both parties shall be
relieved and released of and from any further liability hereunder, and the
Xxxxxxx Money, together with interest thereon, shall forthwith be returned to
Buyer and thereupon this agreement shall become null and void and be considered
cancelled. If no such election is made, this agreement shall remain in full
force and effect and the purchase contemplated
15
herein, less any interest taken by eminent domain or condemnation herein, shall
be effected with no further adjustment, and upon the Closing Seller shall
assign, transfer and set over to Buyer all of the right, title and interest of
Seller in and to any awards that have been or that may thereafter be made for
such taking. For purposes of this paragraph, a condemnation of the Property
shall be deemed "material" if any tenant of the Property would have the right to
terminate its lease as a result of the condemnation or if the loss of ownership
of the condemned property would be a material impediment to the operation or
leasing of any portion of the Property.
17. NOTICE.
Any notice given under this agreement shall be deemed given on the date
the same is hand delivered to the following addresses or is deposited in the
United States mail (registered or certified), postage prepaid, addressed as
follows:
IF TO SELLER: Rice Park Associates, LLC
c/o Frauenshuh Companies
0000 Xxxx 00xx Xxxxxx
Xxxxxxxxxxx, XX 00000
Attn: Xxxxx XxXxx, and
Attn: Xxxx X. Xxxxxxxxx
and
WITH A COPY TO: Xxxxx X. Xxxxxxx, Esq.
Xxxxxx and Xxxxxx, P.A.
0000 XXX Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
IF TO BUYER: Harvard Property Trust, LLC
00000 Xxxxxx Xxxxxxx
Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attn: Xxx Xxxxxx and Xxx X. Xxxxxxxx
WITH A COPY TO: Xxx Xxxxxx, Esq.
Xxxxxx & Xxxxxxx, L.L.P.
0000 X. Xxxxxxx Xxxxxxxxxx
Xxxxx 0000
Xxxxxx, Xxxxx
IF TO TITLE COMPANY: Commercial Partners Title, LLC
000 Xxxxx Xxxxx Xxxxxx
Xxxxx 0000
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attn: Xxxx Xxxxxxxxxx
18. DEFAULT BY SELLER.
16
In the event that Seller should fail to consummate the transactions
contemplated herein for any reason, except Buyer's default or a permitted
termination of this Agreement, Buyer's sole remedies shall be to:
a. Terminate this Agreement, in which event the Xxxxxxx Money shall
forthwith be returned to Buyer and in which event, Buyer shall
have no further remedies or causes of action against Seller; or
b. Enforce the specific performance of this agreement.
The prevailing party in any litigation brought pursuant to this section shall be
entitled to reimbursement of its attorneys fees by the other party. No delay or
omission in the exercise of any right or remedy accruing to Buyer upon any
breach by Seller under this Agreement shall impair such right or remedy or be
construed as a waiver of any such breach theretofore or thereafter occurring.
The waiver by Buyer of any condition or of any subsequent breach of the same or
any other term, covenant, or condition herein contained shall not be deemed to
be a waiver of any other condition or of any subsequent breach of the same or
any other term, covenant, or condition herein contained. All rights, powers,
options or remedies afforded to Buyer either hereunder or by law shall be
cumulative and not alternative, and the exercise of one right, power, option or
remedy shall not bar other rights, powers, options or remedies allowed herein or
by law.
19. DEFAULT BY BUYER.
In the event that Buyer should fail to consummate the transaction
contemplated herein for any reason, except Seller's default or a permitted
termination of this Agreement, Seller's sole and exclusive remedy shall be
either (i) to enforce the specific performance of this Agreement or (ii) to
terminate this Agreement and recover the Xxxxxxx Money, it being agreed between
Seller and Buyer that such sum shall be liquidated damages for a default by
Buyer under this Agreement because of the difficulty, inconvenience, and
uncertainty of ascertaining actual damages for such default. The amount of the
Xxxxxxx Money represents Seller's and Buyer's best estimate of the damages that
will be suffered by Seller because of Buyer's default.
The prevailing party in any litigation brought pursuant to this section
shall be entitled to reimbursement of its attorneys fees by the other party. No
delay or omission in the exercise of any right or remedy accruing to Seller upon
any breach by Buyer under this agreement shall impair such right or remedy or be
construed as a waiver of any such breach theretofore or thereafter occurring.
The waiver by Seller of any condition or of any subsequent breach of the same or
any other term, covenant, or condition herein contained shall not be deemed to
be a waiver of any other condition or of any subsequent breach of the same or
any other term, covenant, or condition herein contained. All rights, powers,
options or remedies afforded to Seller either hereunder or by law shall be
cumulative and not alternative, and the exercise of one right, power, option or
remedy shall not bar other rights, powers, options or remedies allowed herein or
by law.
20. TAX FREE EXCHANGE.
Seller may elect to perform its obligation hereunder to sell the
Property to Buyer by execution of a tax free exchange or deferred tax free
exchange. In such event, Buyer agrees to cooperate with such Seller, including
without limitation, by the execution of purchase agreements for the real estate
to be exchanged or execution of agreements to escrow sales proceeds, provided
that nothing herein shall require Buyer to incur costs or liability in excess of
the costs or liabilities Buyer would incur in the
17
absence of such tax free exchange and nothing herein shall require Buyer to
waive any rights which Buyer has under the terms of this agreement with respect
to the Property.
21. ASSIGNMENT.
Buyer shall not be entitled to assign this agreement to any party other
than an Affiliate (as hereinafter defined) without Seller's prior written
consent, which consent shall not be unreasonably withheld. Any assignment by
Buyer shall not relieve Buyer from liability arising from a default by Buyer's
assignee nor require Seller to exhaust its remedies against such assignee or to
bring a claim against such assignee prior to bringing a claim against Buyer.
Buyer may assign its rights under this Agreement to an Affiliate without the
prior written consent of Seller. For purposes of this Section 21, the term
"Affiliate" shall mean: (a) an entity that controls, is controlled by, or is
under common control with Buyer; (b) any partnership in which Buyer or Buyer's
controlling member is the general partner; or (c) any fund or entity sponsored
by Buyer.
22. APPLICABLE LAW.
This agreement shall be governed by and construed in accordance with the
substantive laws of the State of Minnesota.
23. HEADINGS.
Descriptive headings are for convenience only and shall not control or
affect the meaning or construction of any provision of this agreement.
24. BINDING EFFECT.
This agreement shall be binding upon and shall inure to the benefit of
the parties hereto and their successors and assigns.
25. COUNTERPARTS.
This agreement may be executed in any number of counterparts or may be,
where the same are not required, certified or otherwise delivered without the
testimonium clause and signatures; each such counterpart hereof shall be deemed
to be an original instrument, but all such counterparts together shall
constitute but one agreement.
26. SEVERABILITY.
In case any one or more of the provisions contained in this agreement
shall for any reason be held to be invalid, illegal or unenforceable in any
respect, such invalidity, illegality or unenforceability shall not affect any
other provision hereof, and this agreement shall be construed as if such
invalid, illegal or unenforceable provision had never been contained herein.
27. SURVIVAL.
All representations, warranties, and obligations of the parties
contained in this agreement shall survive the closing of the transaction
contemplated by this Agreement for a period of one year following the Closing
Date. Buyer may not bring any claim based on the representations, warranties and
obligations of Buyer contained in this Agreement after such one year period,
time being of the essence.
18
28. ACCEPTANCE.
The offer contained herein shall remain open and subject to acceptance
by Buyer on or before 5:00 P.M., Central Time, Minneapolis, Minnesota, May ___,
2005, unless sooner revoked in writing by Seller or rejected by Buyer. The
acceptance of Buyer shall be noted below by its endorsement of this agreement
with delivery to Seller. Failure of Buyer to transmit acceptance, if any, within
the time specified above shall terminate Seller's offer herein without further
action, time being the essence of this agreement.
IN WITNESS WHEREOF, the parties have hereunto set their hands effective
the date and year first above written.
THIS INSTRUMENT WAS DRAFTED BY:
Xxxxx X. Xxxxxxx
Xxxxxx and Xxxxxx
0000 XXX Xxxxxx
Xxxxxxxxxxx, XX 00000
000- 000-0000
19
SIGNATURE PAGE TO
COMMERCIAL PURCHASE AGREEMENT
Harvard Property Trust, LLC
By______________________________________________
Its___________________________________________
SIGNATURE PAGE TO
COMMERCIAL PURCHASE AGREEMENT
Rice Park Associates, LLC
By______________________________________________
Its___________________________________________
ESCROW AGENT
Escrow Agent hereby accepts the foregoing as instructions to Commercial
Partners Title, LLC and agrees to be bound by the provisions applicable to
Escrow Agent and to perform its obligations as set forth herein. Notwithstanding
anything to the contrary contained in this Agreement, if Closing fails to occur,
Escrow Agent shall not disburse the Xxxxxxx Money to the party requesting
disbursement thereof without giving written notice to the other party and
allowing such other party a period of ten (10) days to object to the requested
disbursement. Upon receipt of any notice of objection, Escrow Agent shall tender
unto the registry or custody of any court of competent jurisdiction all money in
its possession held under the terms of this Agreement, together with such legal
pleading as it deems appropriate, and thereupon be discharged.
Date:___________________________ Commercial Partners Title, LLC
By:_____________________________________
Printed Name:___________________________
Title:__________________________________
SCHEDULE OF EXHIBITS
EXHIBIT
A. Legal Description of Land
B. Personal Property
C. Leases
D. Contracts
E. Tenant Estoppel Certificate
EXHIBIT A
DESCRIPTION OF LAND
Xxxx 0, 0, 0 xxx 0, Xxxxx 0, XX. XXXX PROPER, according to the recorded plat
thereof, Xxxxxx County, Minnesota, and those parts of Lots 4 and 9, said Block
8, lying southwesterly of a line, 177.08 feet southwesterly of and parallel with
the northeasterly line of said Block 8.
A-1
EXHIBIT B
PERSONAL PROPERTY
EQUIPMENT
---------
1 Computer System (POS)
1 Label Maker
1 Dewalt DW936 Battery operated 5 3/8" Trim Saw
1 Dewalt DW954 3/8" Cordless Drill
1 Dewalt 1/2" Cordless Drill
1 Dewalt DW965 3/8" Cordless Right Angle Drill
1 Schmacher 10/30/50 Amp Fast Battery Charger
0 Xxxxxx XX000 0/0"XXX Xxxxx
1 Dewalt DW431 Belt Sander
1 Makita 9036 Pad Sander
1 Xxxxxx Model 9515 14" Cut-off Saw
1 Bosh 11236 VS Xxxxxx Xxxxx
0 Xxxxxxxxxx Xxxxx XX00X Xxxx Nailer
1 Dewalt DW307 VS Reciprocating Saw
1 Remington Model 490 Low Velocity Powder Actuated Tool
1 Dewalt DW359 7 1/4" Circular Saw
1 Halogen Work Light on tripod stand
1 Ladder 18'
7 Quick Grip Bar Clamps
1 Level 24"
1 Bolt Cutter 24"
7 C Clamps (misc.)
1 Hose Clamps (assortment)
2 Rigid F110 Plumbing Wrenches (Smooth Jaw)
1 Wrench Strap
3 Wonder Bars
3 Pipe Wrenches (misc.)
1 Face Shield for grinding
5 Dry Bars (various)
6 Vice Grips (assortment)
1 Welding Helmet
1 Craftsman Shop Vac 20 gallon
1 Xxxxxxx Powermate Compressor 20 gallon 5hp
4 sets Xxxxx Wrenches (US and metric)
25 Screwdrivers (misc.)
2 sets Wrenches (1 US and 1 metric)
2 sets Nut Drivers (1 US and 1 metric)
3 sets Sockets 1/4" (US, metric, Deep)
2 Ratchets 1/4"
4 sets Sockets 3/8" (US, metric, Deep)
1 Ratchet 3/8"
4 Extensions 3/8" (misc.)
2 sets Sockets 1/2" (US and metric)
1 Sabre Saw
1 Electrical Tester (pocket)
B-1
1 Strong Box Puller Set OTC1676
1 Surefire T655 Propane Torch Head (self igniting)
1 Xxxxxx Soldering Kit
1 Bravo Key Cutting Machine
1 Dewalt DW505 1/2" VSR Hammer Drill
1 Makita 9227 C Buffer
1 Xxxxxx Model 4205 5" Disc Sander Grinder
1 Dewalt DW400 4 1/2" Angle Grinder
1 Wissota Mod E6 1/3 Hp Bench Grinder
3 Torpedo Levels 6"
2 Claw Hammers (misc.)
1 Dremel Electric Engraving Tool
1 Battery Terminal Brush
1 Spud Wrench
1 Electrical Fish Tape
2 Tubing Cutters (misc.)
1 Marson Rivet Kit $39001
1 Florida Pneumatic FP 3751K Die Grinder
2 Hole Saw Kits (incomplete)
1 Wrench Set Large SK#1714 3/8 - 1 1/4"
1 Mayhen #701K set of punches and chissels
1 set Xxxxxxx Xxxx Chisels
2 Hammers Large 24 oz.
1 Xxxxxxx Chart Recorder SC4
1 Pipe Wrench - Smooth Jaw
1 Nut and Bolt Cabinet (Large)
1 Nut and Bolt Cabinet (Small)
1 set Wrenches Combination 1/4 - 1 1/8
2 Carbon Dioxide Monitors YES 203
1 Ace Submersible Pump 1/6 HP
1 Milwaukee Heavy Duty Drain Cleaner
1 Receptacle Tester w/GFI Tester
1 Baytek Raynger St. Non Contact Temp. Probe
1 AWS Model DSA 2007 Clamp on Amp Meter
1 Fluke 87III True RMS DMN
1 Zircon Stud Finder
1 Dri Steem Hand Held Programmer
1 Fluke Model 51 K/J Thermometer
1 Xxxxxxxx Powerfinder Circuit CT
1 E Xtech Humidity / Temp Meter w/Probes
1 Leviton #49561 SSP Inductive Speaker Probe
1 Leviton Tone Generator
1 RCA Audio System
5 Durham Parts Cabinets w/21 Drawers
2 Ladders extension 24 (1 is bad)
1 Ladder step 12 2 Ladder step 10
2 Ladder step 8
15 Ladder step 6
1 Pallet Xxxx
1 Oasis Metering Station
B-2
6 Motorola battery chargers (misc.)
1 Level 4'
1 Lincoln Arc Welder
1 Oxy-Actelene Set
1 General Drain Snake
1 IBM Computer (EMS)
1 Gravely Snow Broom
1 Ariens Snow Blower
1 Honda Snow Blower
1 Pallet Xxxx
1 Fork Truck
1 Genie Lift
1 Pressure Washer
1 Refrigerator
1 Micro Wave
10 Motorola Walkie Talkies
10 Assorted Hand Carts&Dollies
LOBBY FURNITURE
---------------
6 brass planter's 18" diameter
4 tub chairs
1 glass coffee table
2 floral pots/silk arrangement
1 task desk chair (security)
ENGINEERING ROOM
----------------
1 3x5 metal desk
1 two-drawer file cabinet
6 assorted task chairs
1 18 cubic refrigerator
1 sharp microwave
1 water cooler
1 video surveillance unit
1 6 bank lockers
CHIEF ENGINEER OFFICER
----------------------
3 2-drawer file cabinet
1 4-drawer lateral file cabinet
2 task chairs
SHOP
----
1 wood desk
1 file cabinet 6'
2 task chairs
B-3
EXHIBIT C
LEASES
REAL ESTATE LEASES
1. Xxxxxx Associates, Inc. dated August 8, 1997
2. Xxxxxx Bank National Association dated September 15, 1989
3. RUI One Corp (Xxxxxxx'x), dated July 21, 1999
4. Frauenshuh Companies, dated December 1, 1999
5. Chipotle Mexican Grill, Inc., dated May __, 2000
6. Starbucks Corporation, dated September 27, 2000
7. St. Xxxx Fire & Marine Insurance Co., dated August 8, 1997
LICENSES
1. MCI Metro Access Transmission Services, LLC, dated August 10, 2004
2. XO Minnesota, LLC, dated August 31, 2004
3. City Lites, U.S.A., Inc., dated July 23, 2003
4. BWBR Architects, Inc., dated July 31, 2001
C-1
EXHIBIT D
CONTRACTS
DATE OF AGREEMENT SERVICE VENDOR/CONTRACTOR
5/13/98 Chilled Water District Cooling of St. Xxxx
5/13/98 Hot Water District Energy St. Xxxx
8/1/02 (Effective Date) Waste Removal Waste Management
10/1/00 (Effective Date) Elevator Maintenance KONE
9/1/99 (Effective Date) Janitorial Marsden Building Maintenance
10/1/04 (Effective Date) Pest Guardian Pest Control
1/01/01 (Effective Date) Security System Low Voltage Contractors
10/01/01 Fire/Life Safety Systems Low Voltage Contractors
1/01/04 (Effective Date) Security American Security
D-1
EXHIBIT E
TENANT ESTOPPEL CERTIFICATE
Harvard Property Trust, LLC
00000 Xxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
RE: Office building located at 000 Xx. Xxxxx Xxxxxx, Xx. Xxxx,
Xxxxxxxxx (the "BUILDING")
Gentlemen:
Reference is made to that certain [LEASE AGREEMENT] dated as of
____________ __, ____ between ____________________________, a ____________, as
landlord ("LANDLORD"), and the undersigned, as tenant ("TENANT"), demising
premises in the captioned Building more particularly described in the Lease (the
"PREMISES"). The lease, together with all amendments thereto included in
SCHEDULE 1 attached hereto, is herein referred to as the "LEASE." Tenant hereby
represents to the Benefited Parties (as herein defined) that the following
statements are true and correct as of the date hereof:
1. A true, correct and complete copy of the Lease (including all
amendments) is attached hereto as SCHEDULE 1. The undersigned is the Tenant
under the Lease for space at the Premises covering ___________ rentable square
feet.
2. The Lease is in full force and effect and has not been amended,
modified, supplemented or superseded except as indicated in Schedule 1. There
are no understandings, contracts, agreement or commitments of any kind
whatsoever with respect to the Premises, except as expressly provided in the
Lease.
3. The term of the Lease commenced on ________________, and expires
on _________________, subject to any rights of Tenant to extend the term as
provided therein. The base rent presently being charged is $__________. All
rentals, charges, additional rent and other obligations on the part of the
undersigned have been paid to and including ____________, 200_. No rental, other
than for the current month, has been paid in advance. The undersigned has
accepted possession and now occupies the Premises and is currently open for
business. In addition to the fixed minimum Base Rent, the Tenant pays its
pro-rata share of real estate taxes and operating expenses in excess of a base
stop of _________________.
4. Tenant has paid to Landlord a security deposit in the amount of
$__________________. Tenant has no claim against Landlord for any other
security, rental, cleaning access card, key or other deposits or any prepaid
rentals.
5. Landlord is not in any respect in default in the performance of
the terms and provisions of the Lease, nor does any state of facts or condition
exist which, with the giving of notice or the passage of time, or both, would
result in such a default. All conditions under the Lease to be performed by
Landlord have been satisfied. Without limiting the generality of the foregoing,
all improvements to be constructed in the Premises by Landlord have been
completed to the satisfaction of Tenant and accepted by Tenant and any tenant
construction allowances have been paid in full, and all duties of an inducement
nature required of Landlord in the Lease have been fulfilled to Tenant's
satisfaction. Tenant has no claim against Landlord by reason of any restriction,
encumbrance or defect in title of the Premises of which Tenant has actual
knowledge.
F-E-D-1
6. There currently is no defense, offset, lien, claim or
counterclaim by or in favor of Tenant against Landlord under the Lease or
against the obligations of Tenant under the Lease (including, without
limitation, any rentals or other charges due or to become due under the Lease)
and Tenant is not contesting any such obligations, rentals or charges. To
Tenant's knowledge, all leasing commissions due in respect of the current term
of the Lease have been paid.
7. Tenant has no renewal, extension or expansion option, no right
of first offer or right of first refusal and no other similar right to renew or
extend the term of the Lease or expand the property demised thereunder except as
may be expressly set forth in the Lease. Tenant has no right to lease or occupy
any parking spaces within the Property except as set forth in the Lease. Tenant
is entitled to no free rent nor any credit, offsets or deductions in rent, nor
other leasing concessions other than those specified in the Lease.
8. Tenant is not in any respect in default in the performance of
the terms and provisions of the Lease nor does any state of facts or condition
exist which, with the giving of notice or the passage of time, or both, would
result in such a default. Without limiting the generality of the foregoing,
Tenant is current in its rental obligation under the Lease.
9. The undersigned has not received notice of a prior transfer,
assignment, hypothecation or pledge by Landlord of any of Landlord's interest in
the Lease other than to the holder of any first mortgage on the captioned
property.
10. There are no liens recorded against the Premises with respect to
work performed by or on behalf of Tenant or materials supplied to the demised
property.
11. Tenant has not assigned the Lease nor sublet all or any part of
the Premises, except as shown on Schedule 1 attached hereto and made a part
hereof for all purposes.
12. Tenant acknowledges and agrees that if any of the Benefited
Parties acquire title to the Property, such Benefited Party shall have
responsibility as landlord under the Lease to the extent set forth in the Lease
or other writing executed between such Benefited Party and Tenant, but such
Benefited Party will have no obligation under any other document executed
between Landlord and Tenant, including, specifically, without limitation, any
agreement pertaining to the development, construction or financing of the
Building and related property. Tenant agrees to look solely to Landlord for the
performance of Landlord's obligations under such other agreements.
IN THE ESTOPPEL CERTIFICATE FOR XXXXXX ASSOCIATES, THE FOLLOWING
PROVISION SHOULD BE ADDED:
13. TENANT HAS NO OPTION, RIGHT OF FIRST REFUSAL OR OTHER
PREFERENTIAL PURCHASE RIGHT WITH RESPECT TO THE BUILDING. UPON THE SALE OF THE
BUILDING, TENANT IS ENTITLED TO A ONE-TIME PAYMENT OF $_____________ IN
ACCORDANCE WITH ARTICLE 16 OF EXHIBIT E TO THE LEASE. TENANT AGREES THAT IT WILL
NOT BE ENTITLED TO ANY OTHER PAYMENT ARISING OUT OF THE CURRENT OR ANY
SUBSEQUENT SALE OR REFINANCING OF THE BUILDING.
14. Landlord has fulfilled any obligations to Tenant with respect to
the development, construction or financing of the Building and related property,
whether arising under the Lease or otherwise.
The above certifications are made to the Benefited Parties knowing that
the Benefited Parties will rely thereon in making an investment in the Building
and the Premises. For purposes hereof, the term "BENEFITED PARTIES" means the
addressees of this letter and all of the following: (a) Harvard Property
F-E-D-2
Trust, LLC, a Delaware limited liability company and its successors, assigns,
and designees (including, without limitation, any tenant in common purchasers);
and (b) any lender to which any party described in the foregoing clause (a)
grants a deed of trust, mortgage or other lien upon the Building or Premises.
Very truly yours,
a ___________________________________ ,
By:_____________________________________
Name:___________________________________
Title:__________________________________
F-E-D-3
JOINDER OF GUARANTOR
The undersigned joins in the execution of this Estoppel Certificate for
the purpose of confirming to and for the benefit of the Benefited Parties (a)
that the guaranty of Tenant's obligations under the Lease executed by the
undersigned remain in full force and effect, and (b) that the undersigned has no
defenses or offsets to its obligations under the guaranty of the Lease executed
by the undersigned. The undersigned understands that the Benefited Parties will
rely upon the foregoing confirmations.
a ___________________________________ ,
By:_____________________________________
Name:___________________________________
Title:__________________________________
F-E-D-4
