EXHIBIT 10.15
CONTRACT OF SALE/CONTRIBUTION
BETWEEN
JEFFERSON COMMONS - TUCSON PHASE II LIMITED PARTNERSHIP AND
JEFFERSON COMMONS - COLUMBIA, L.P.
AS SELLER,
AND
EDUCATION REALTY OPERATING PARTNERSHIP, LP
AS BUYER
TABLE OF CONTENTS
ARTICLE 1 PURCHASE PRICE AND XXXXXXX MONEY................................................................2
Section 1.1 Agreement to Sell and Purchase.......................................................2
Section 1.2 Purchase Price.......................................................................2
Section 1.3 Xxxxxxx Money........................................................................4
SELLER'S INITIALS:.......................................................................................6
ARTICLE 2 TITLE INSURANCE, OTHER INFORMATION, AND SURVEY..................................................6
Section 2.1 Title Insurance......................................................................6
Section 2.2 Other Information....................................................................6
Section 2.3 Survey...............................................................................8
Section 2.4 Other Property.......................................................................8
ARTICLE 3 TITLE REVIEW AND DUE DILIGENCE..................................................................8
Section 3.1 Title Review.........................................................................8
Section 3.2 Due Diligence Period.................................................................9
ARTICLE 4 SELLER'S REPRESENTATIONS, WARRANTIES, AND COVENANTS............................................10
Section 4.1 Seller's Representations and Warranties.............................................10
Section 4.2 Several Liability; Survival of Representations and
Warranties..........................................................................16
Section 4.3 Knowledge Standard..................................................................17
Section 4.4 Seller's Covenants..................................................................17
ARTICLE 5 BUYER'S REPRESENTATIONS AND WARRANTIES.........................................................19
Section 5.1 Buyer's Representations and Warranties..............................................19
Section 5.2 Buyer's Covenants...................................................................20
ARTICLE 6 CLOSING AND PRORATIONS.........................................................................22
Section 6.1 Closing Date........................................................................22
Section 6.2 Closing Matters.....................................................................22
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Section 6.3 Prorations..........................................................................25
Section 6.4 Closing Costs.......................................................................26
Section 6.5 Assumption Approval.................................................................27
Section 6.6 Release Approval....................................................................27
Section 6.7 Seller's and Buyer's Joint Covenants Regarding Taxation
of Cash/Unit Purchase...............................................................27
ARTICLE 7 DEFAULTS AND REMEDIES..........................................................................29
Section 7.1 Material Breach of Seller's Representations and
Warranties Prior to Closing.........................................................29
Section 7.2 Buyer's Remedies....................................................................29
Section 7.3 Seller's Remedies...................................................................31
ARTICLE 8 CASUALTY AND CONDEMNATION......................................................................31
Section 8.1 Risk of Loss and Notice.............................................................31
Section 8.2 Minor Casualty......................................................................32
Section 8.3 Major Casualty and Condemnation.....................................................32
ARTICLE 9 MISCELLANEOUS..................................................................................33
Section 9.1 Notices.............................................................................33
Section 9.2 Performance.........................................................................35
Section 9.3 Binding Effect......................................................................35
Section 9.4 Entire Agreement....................................................................35
Section 9.5 Assignment..........................................................................35
Section 9.6 Commissions.........................................................................36
Section 9.7 Headings............................................................................36
Section 9.8 Holidays, Etc.......................................................................36
Section 9.9 Legal Fees..........................................................................36
Section 9.10 Governing Law.......................................................................36
Section 9.11 Severability........................................................................36
Section 9.12 Disclaimers, Waivers, and Releases..................................................37
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Section 9.13 Rule of Construction................................................................40
Section 9.14 Effective Date......................................................................40
Section 9.15 Independent Contract Consideration..................................................40
Section 9.16 Counterparts and Facsimile Signatures...............................................40
Section 9.17 No Recording........................................................................40
Section 9.18 Further Acts........................................................................40
Section 9.19 Arbitration.........................................................................40
Section 9.20 Exchange............................................................................42
Section 9.21 Related Property....................................................................42
Section 9.22 Confidentiality.....................................................................43
EXHIBIT A-1 Legal Description of the Real Property Located in Pima
County, Arizona
EXHIBIT A-2 Legal Description of the Real Property Located in Xxxxx
County, Missouri
EXHIBIT B List of Approved Service Contracts
EXHIBIT C List of Personal Property
EXHIBIT D Intentionally Omitted
EXHIBIT E Pro Rata Cash Allocation
EXHIBIT F Reports
EXHIBIT G List of Delivered Loan Documents
EXHIBIT H List of Delivered Surveys
EXHIBIT I Other Contracts for Development
EXHIBIT J Deed Restrictions
EXHIBIT K Litigation
EXHIBIT L Notices from Governmental Authorities
EXHIBIT M Buyer's Partnership Agreement
EXHIBIT N Knowledge Individuals
EXHIBIT O Agreement Regarding Contributed Properties
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EXHIBIT P Liquidity Loan Documents
EXHIBIT Q Deed
EXHIBIT R Xxxx of Sale
EXHIBIT S Assignment of Leases, Contracts, Security Deposits and
Warranties
EXHIBIT T IRC Section 1445 Certification
EXHIBIT U Tenant Notice Letter
EXHIBIT V Non-Exclusive Service Xxxx License Agreement
EXHIBIT W Legal Opinion
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CONTRACT OF SALE/CONTRIBUTION
This Contract of Sale/Contribution (this CONTRACT) is between JEFFERSON COMMONS
- TUCSON PHASE II LIMITED PARTNERSHIP, a Delaware limited partnership (STAR
RANCH) and JEFFERSON COMMONS - COLUMBIA, L.P., a Delaware limited partnership
(JC COLUMBIA) (Star Ranch and JC Columbia, are hereinafter sometimes
collectively referred to in this Contract as SELLER), and EDUCATION REALTY
OPERATING PARTNERSHIP, LP, a Delaware limited partnership (BUYER).
BACKGROUND
Buyer wants to purchase, and each Seller wants to sell, all of its interest in:
a. the real property located in Pima County, Arizona, more
particularly described on EXHIBIT A-1 and the real property
located in Xxxxx County, Missouri, more particularly
described on EXHIBIT A-2 all attached to this Contract
(collectively, the REAL PROPERTY), and all rights and
appurtenances pertaining to the Real Property, including any
interest of Seller in adjacent streets, alleys, easements,
and rights-of-way;
b. all improvements, structures, and fixtures located on the
respective tracts of Real Property (collectively, the
IMPROVEMENTS);
c. the landlord's interest in all residential leases, affecting
the respective tracts of Real Property (LEASES), related
security deposits (DEPOSITS) and guaranties (GUARANTIES), and
the Service Contracts listed in EXHIBIT B attached to this
Contract not terminated on or before the Closing Date
(defined in SECTION 6.1) in accordance with SECTION 3.2(e)
(the SERVICE CONTRACTS);
d. the personal property located on the respective tract of Real
Property described on the list attached as EXHIBIT C to this
Contract (the PERSONAL PROPERTY) but excluding any personal
property specifically excluded on EXHIBIT C;
e. the respective Seller's interest in all plans for the
Improvements (the PLANS);
f. the respective Seller's interest in all warranties and
guaranties relating to the Improvements, if any, including
all unexpired third party warranties and guarantees, if any,
received in connection with the construction, improvement, or
equipment of the Improvements, but excluding all warranties
and guaranties from any Seller Affiliate (defined in SECTION
9.5) (the WARRANTIES);
g. all records and correspondence relating to tenants in the
respective Seller's possession or the respective Seller's
property manager, JPI Apartment Management, L.P. (PROPERTY
MANAGER), used in the continuing operation of the
Improvements excluding all documents that are subject to an
attorney-client privilege (the RECORDS).
The Real Property, the Improvements, the Leases, the Deposits, the Guaranties,
the Service Contracts, the Personal Property, the Plans, the Warranties, and
the Records are collectively called the PROPERTY.
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Without limitation, the following are not included in the Property: the name
"Jefferson", "Jefferson Commons", the initials "JPI" (although Seller's
affiliate has provided a limited license for use of such names/initials
pursuant to a license agreement hereafter more particularly set forth), any
logo, trade name, or other name utilizing "Jefferson", "Jefferson Commons" or
"JPI", any software owned by or licensed to any company or entity other than
Seller, any professional photographs of the Property, including, but not
limited to, photographs, negatives, and transparencies in digital or other
form, and any bonds or letters of credit issued in favor of any Governmental
Authorities (defined in SECTION 4.1) by Seller or any Seller Affiliate in
connection with the construction of the Improvements.
ARTICLE 1
PURCHASE PRICE AND XXXXXXX MONEY
Section 1.1 Agreement to Sell and Purchase.
Each Seller shall sell and/or contribute to Buyer, and Buyer shall purchase
from each Seller, the Property, free and clear of any and all liens and
encumbrances and subject only to the Permitted Exceptions (defined in SECTION
3.1), upon the terms of this Contract.
Section 1.2 Purchase Price.
(a) The PURCHASE PRICE of the Property is $59,485,000, subject to
all prorations and credits set forth herein, payable in
immediately available United States funds at Closing (defined
in SECTION 6.1).
(b) The Purchase Price is allocated as follows:
Individual Property's Owner Purchase Price Allocation(1)
Star Ranch $32,300,000
JC Columbia $27,185,000
Total Purchase Price $59,485,000
(c) The Purchase Price is payable at Closing (defined in SECTION
6.1) as follows:
(i) By Buyer taking title to the Property assuming
(subject to, and inclusive of the non-recourse
provisions thereof) all obligations accruing from
and after the Closing Date under Seller's Existing
Loans (as defined in SECTION 2.2(i)) which are
generally described in SECTION 2.2(i), but excluding
those obligations resulting from a default by Seller
under the Existing Loans. Seller shall cooperate
with and assist Buyer, but at no cost or expense to
Seller (other than its attorney's fees) and without
Seller or Seller Affiliates having to incur any
additional obligations, in
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(1) Allocation of any portion of the Purchase Price to Personal Property
by Buyer shall be based on the then reasonable market value of such
Personal Property, but in no event shall such amount exceed 10% of the
respective Purchase Price Allocation. This provision shall survive
Closing.
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connection with the Buyer seeking consent from the
Lenders for the assumption of the Existing Loans
(subject to and inclusive of, the non-recourse
provisions thereof) on terms and conditions
acceptable to Buyer in its sole discretion and
specifically without Buyer being required to agree
to any material change of any term of any Existing
Loan document, as a condition to Lender's approval
of the assumption (the ASSUMPTION). Any and all fees
or expenses required to be paid to Lenders in
connection with Buyer's Assumption (subject to and
inclusive of, the non-recourse provisions thereof)
of the Existing Loans shall be borne one-half (1/2)
by Buyer and one-half (1/2) by Seller; provided,
however, any fees, expenses or payments (but not
payments representing all or substantially all of
the remaining balance of the Existing Loans)
resulting from a default by Seller under the
Existing Loans prior to Closing shall be paid solely
by Seller at Closing. Additionally, Buyer shall use
commercially reasonable efforts to obtain a release,
reasonably acceptable to Seller, of all liabilities,
indemnities and guarantees of Seller and Seller
Affiliates accruing from and after the Closing Date
under the Existing Loans (the SELLER RELEASES) but
Buyer shall not be obligated to assume any
additional obligations to the Lenders to do so and
Seller shall not be obligated to pay any costs or
fees (other than its share of the assumption fees
and costs set forth above) not approved by Seller;
and
(ii) at the election of Seller, notice of which shall be
delivered in writing to Buyer by no later than
September 22, 2004 (the ELECTION NOTICE), either:
(A) By (i) Buyer paying cash, by wire transfer
for disbursement to Seller at Closing, the
amount of the Purchase Price, less the
total amount of unpaid principal and
accrued but unpaid interest owing pursuant
to the Existing Loans as of the Closing
Date, subject to prorations and other
debits or credits provided for in this
Contract (the NET AMOUNT); or (ii) Buyer
paying and delivering to the Seller or
Seller's designees (the DESIGNATED OWNERS),
cash and units of limited partnership
interest in the Buyer (UNITS) for
disbursement to Seller or to the Designated
Owners at Closing in the aggregate amount
equal to the Net Amount.
(B) All cash payable at Closing shall be sent
by wire transfer to the Closing Agent for
disbursement to each Seller at Closing. If
all of the Net Amount is payable to Seller
in cash, Seller hereby directs the Buyer to
pay the cash on the Closing Date to the
Seller as set forth in SECTION 1.2(b).
(C) If Seller makes an election pursuant to
SECTION 1.2(c)(II)(A) to receive any
portion of the Net Amount in Units, Seller
shall deliver to Buyer, together with the
Election Notice, a schedule to this
Contract, which shall become EXHIBIT E
hereto, which shall set forth, with respect
to each Seller (i) the name of the Seller
or the Designated Owners, (ii) the total
portion of the Net Amount payable to such
Seller and/or Designated Owner, (iii) the
portion of such amount payable to such
Seller which shall be in the form of cash,
(iv) the portion of such amount which shall
be payable to
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such Seller or the Designated Owner(s) in Units and,
if more than one recipient of Units is designated,
the specific proportions to be issued to each. The
number of Units to be issued at Closing to each
Seller or Designated Owner shall be equal to (i) the
unit value set forth in EXHIBIT E for the respective
Seller, divided by (ii) the per share price at which
the common stock (the COMMON STOCK) of Education
Realty Trust, Inc., a Maryland corporation (the
REIT), is offered to the public in the underwritten
initial public offering of the Common Stock (the
PUBLIC OFFERING) before any discounts or fees paid
to underwriters. Each Seller and Designated Owner to
receive Units shall also provide to Buyer within
five (5) days after Seller's delivery to Buyer of
the Election Notice a duly executed accredited
investor questionnaire in a form provided by Buyer
(the form of which to be substantially similar to
that provided to other persons to confirm their
accredited investor status). If the Net Amount is
payable to Seller (or the Designated Owners) in a
combination of cash and Units, Seller hereby directs
the Buyer to pay, issue and distribute (as
applicable) the cash and the Units on the Closing
Date to the Seller and/or the Designated Owners in
accordance with EXHIBIT E. No fractional Units will
be issued as consideration hereunder, but in lieu of
issuing fractional Units, the value thereof shall be
paid in cash to Seller. Each Designated Owner
acknowledges that any certificates evidencing the
Units will bear appropriate legends indicating (1)
that the Units have not been registered under the
Securities Act of 1933, as amended (SECURITIES ACT),
and (2) that the Buyer's Agreement of Limited
Partnership (the BUYER'S PARTNERSHIP AGREEMENT) will
restrict the transfer of the Units but such
restriction shall not be more restrictive than that
which affects other third party Unit holders. Upon
receipt of the Units, the Sellers or Designated
Owners, as applicable, shall become limited partners
of the Buyer and shall execute the Buyer's
Partnership Agreement.
Section 1.3 Xxxxxxx Money.
(a) On the Effective Date (defined in SECTION 9.14), as a
condition to the continued effectiveness of this Contract,
Buyer shall deposit with Marble Title Company, L.L.C. (TITLE
COMPANY), as agent for Chicago Title Insurance Company
(CLOSING AGENT), 0000 Xxxxx Xxxxxx, Xxxxx 0000, Xxxxxx, Xxxxx
00000, Attention: Xxxxx X. Xxxxxx, Phone: (000) 000-0000,
Fax: (000) 000-0000, $101,000 in (i) immediately available
federal funds or (ii) the form of an unconditional and
irrevocable letter of credit in favor of Seller and Closing
Agent on terms and from an issuer reasonably acceptable to
Seller (a LETTER OF CREDIT) (the XXXXXXX MONEY).
(b) The Xxxxxxx Money, if paid in the form of immediately
available federal funds (and not by Letter of Credit), shall
be applied to the Purchase Price at Closing, however, any
Letter of Credit shall be returned to Buyer after Closing
with no portion of its funds having been credited against the
Purchase Price. The Xxxxxxx Money is non-refundable to Buyer
in all events, except for a Seller default or as otherwise
specifically set forth herein. If Buyer fails to deliver the
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Xxxxxxx Money, this Contract will automatically terminate. If
Buyer fails to close the transaction on January 31, 2005, and
the Closing is not extended by mutual written agreement of
the parties or pursuant to the provisions of SECTION 6.1,
this Contract will automatically terminate, the Xxxxxxx Money
will be paid to Seller and the parties will have no further
obligations to each other. If any of the Xxxxxxx Money is in
the form of a Letter of Credit then, any reference in this
Contract to Seller being paid any portion of the Xxxxxxx
Money is deemed to include and Seller shall have the right to
draw upon the Letter of Credit and retain the proceeds.
(c) If this Contract does not close, the Xxxxxxx Money will be
paid or the Closing Agent shall deliver the Letter of Credit
as provided in this Contract. Closing Agent shall, promptly
upon receipt, place the wire transferred Xxxxxxx Money in a
federally insured, interest bearing account. All interest on
the Xxxxxxx Money becomes part of the Xxxxxxx Money. All
interest on the Xxxxxxx Money will be reported to the
Internal Revenue Service as income of Buyer. Buyer shall
promptly execute and deliver to Closing Agent all forms
reasonably requested by Closing Agent with respect to the
Xxxxxxx Money. Buyer acknowledges and agrees that, except for
a default by Sellers under SECTION 7.1 or SECTION 7.2 or the
occurrence of a Major Casualty prior to Closing, the Xxxxxxx
Money is non-refundable to Buyer. Buyer acknowledges and
agrees that, except for a default by Sellers under SECTION
7.1 or SECTION 7.2 or the occurrence of a Major Casualty
occurs prior to Closing, the Xxxxxxx Money is non-refundable
to Buyer.
(d) Closing Agent is authorized and directed to pay the Xxxxxxx
Money and/or deliver any Letter of Credit for any portion of
the Xxxxxxx Money to the party entitled to receive the
Xxxxxxx Money under the terms of this Contract. Sellers or
Buyer, as appropriate, shall deliver a letter of instruction
to Closing Agent directing the disbursement of the Xxxxxxx
Money or the delivery of the Letter of Credit to the party or
parties entitled to receive the Xxxxxxx Money promptly upon
receipt of a demand from that party or parties.
(e) Upon delivery of the Letter of Credit, if any, to Seller,
Seller is authorized to immediately present it to the issuer
for payment.
(f) The Letter of Credit shall contain an expiry date of not
earlier than April 29, 2005. If, for whatever reason, Seller
has been unable to present the Letter of Credit for payment
on or before March 29, 2005, or if, once presented, Seller
has not been paid the full amount of the Letter of Credit by
March 29, 2005, in any such case, Buyer shall immediately
cause a substitute Letter of Credit to be issued in the same
amount with an expiry date of no earlier than May 30, 2005
(this process shall continue monthly until the Letter of
Credit is either delivered to Buyer or tendered by Seller to
the issuing bank such that they do not expire prior thereto).
If, for whatever reason, Buyer fails to cause a substitute
Letter of Credit to be issued at least twenty-five (25) days
prior to the expiry date of the existing Letter of Credit,
then Buyer and Seller hereby authorize Closing Agent to
immediately present the existing Letter of Credit for payment
and, once paid, to hold the proceeds as "Xxxxxxx Money" in
accordance with the terms of this Contract. Buyer and Seller
agree that Closing Agent is authorized to present the Letter
of Credit for payment even if Buyer has delivered
instructions to the contrary to Closing Agent; provided, that
Closing Agent shall not present the existing Letter
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of Credit as authorized by this SECTION 1.3(f) only if
Closing Agent receives written instructions to the contrary
from both Buyer and Seller. TO SIGNIFY THEIR AWARENESS AND
AGREEMENT TO BE BOUND BY THE TERMS, OF THIS SECTION 1.3(f),
BUYER AND SELLER, THROUGH THEIR AUTHORIZED REPRESENTATIVES
HAVE SEPARATELY INITIALED THIS SECTION 1.3(f). This SECTION
1.3(f) shall survive the termination or expiration of this
Contract.
BUYER'S INITIALS: ___________
SELLER'S INITIALS: ___________
ARTICLE 2
TITLE INSURANCE, OTHER INFORMATION, AND SURVEY
Section 2.1 Title Insurance.
(a) Seller shall cause Closing Agent to agree to issue to Buyer
as soon as practicable after Closing an ALTA Standard
Coverage Owner Policy of Title Insurance for the Real
Property and Improvements on the standard form in use in the
State where the Property is located (collectively, the OWNER
POLICY), which may be based on a marked up title commitment
or binder agreed to and delivered by Closing Agent, at
Closing (it being agreed between Buyer and Seller that
Seller's only obligation is to cause delivery of the Owner
Policy and Seller has no obligation to cause Closing Agent to
provide a marked up title commitment or binder), dated as of
the Closing Date, in the amount of the respective allocated
Purchase Price, insuring good and marketable fee simple title
to the Real Property and Improvements. Buyer may request that
Title Company issue other available endorsements to the Owner
Policy, but any affidavits, indemnities or other documents
requested by Title Company in order for it to issue any
endorsements are subject to approval by Seller in its sole
discretion. Seller is responsible only for payment of the
premium for the Standard Coverage Owner Policy. Buyer shall
pay the premiums charged for and costs associated with
obtaining extended coverage and endorsements to the Owner
Policy and for any loan policy or endorsements required by
the Lenders or any other Lenders of Buyer. Upon issuance, the
Owner Policy will except only to the Permitted Exceptions
which remain at Closing after the title commitment or binder
has been marked up as agreed to between the Buyer and the
Closing Agent.
(b) Sellers have previously caused Closing Agent to furnish to
Buyer a title insurance commitment for each Property, in the
standard form used by the State where the Property is
located, covering each Real Property (collectively, the
COMMITMENT), together with copies of all documents referenced
as title exceptions in the Commitment.
Section 2.2 Other Information.
Buyer and Sellers acknowledge that, prior to the Effective Date, Sellers have
delivered to Buyer the following for each individual Property (collectively,
the DOCUMENTS):
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(a) a rent roll (by building, apartment number and bedroom) (RENT
ROLL), certified to be true and correct in all material
respects by Seller, dated no earlier than 5 days prior to the
date Seller delivers same, showing:
(i) move-in, term, and expiration date for each Lease;
(ii) name of the tenant listed on each Lease;
(iii) the amount of the monthly rent for the unit, any
garage, and any other amenity leased by the tenant;
(iv) the amount of the security and other deposits; and
(v) if the apartment is vacant, the market rent for the
unit;
(b) a delinquency report showing the amount of any arrearages or
delinquencies by tenants under the Leases, certified to be
true and correct in all material respects by Seller;
(c) a concession matrix identifying rent concessions or
forbearances for the Leases, certified to be true and correct
in all material respects by Seller;
(d) copies of the reports listed in EXHIBIT F attached to this
Contract (the REPORTS) which Reports are delivered "AS IS"
and, except as specifically set forth in SECTION 4.1(h),
Seller makes no representation or warranty concerning the
accuracy, correctness, completeness, suitability or utility
of the Reports or the information contained or not contained
therein;
(e) copies of the Service Contracts;
(f) copies of all certificates of occupancy and other permits or
licenses necessary for the operation of the Property which
are in Seller's possession or the possession of Property
Manager;
(g) a copy of the most recent as-built survey of the Real
Property and Improvements in Seller's possession;
(h) copies of ad valorem tax statements for tax years 2002 and
2003;
(i) copies of the documents and instruments listed on EXHIBIT G
executed in connection with the indebtedness (the EXISTING
LOANS) payable to the order of JPMorgan Chase Bank or
Citigroup Global Markets Realty Corp., their respective
successors and assigns as "Lenders" (LENDERS); and
(j) financial statements showing income and expense for the years
2001 (to the extent available), 2002, and 2003 (on a monthly
basis), certified true, correct, and complete in all material
respects by an authorized officer of Seller.
Additionally, Seller shall furnish an operating statement for the
current year (updated monthly within twenty (20) days after the end of
the month through Closing) detailing all
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income and expense items for the Property, certified true, correct and
complete in all material respects by an authorized officer of Seller.
Section 2.3 Survey.
Buyer acknowledges that Seller has previously delivered to Buyer an as-built,
ALTA/ACSM (or similar) survey of each Property prepared by the surveyors and
dated as set forth on EXHIBIT H (collectively, the SURVEY). Updates to or
recertifications of the Survey shall be at Buyer's expense.
Section 2.4 Other Property.
Seller hereby discloses that as of the Effective Date it has not entered into
any contacts for the purchase of property to be developed as "for rent" student
housing within a ten (10) mile radius of any Property, except as set forth on
EXHIBIT I.
ARTICLE 3
TITLE REVIEW AND DUE DILIGENCE
Section 3.1 Title Review.
(a) Buyer acknowledges that it has reviewed the Commitment, the
title exception documents listed therein and the Survey prior
to execution of this Contract, waives any objection it might
have to such items and accepts and approves all matters shown
thereon. Except as specifically set forth in SECTION 3.1(b),
by its execution of this Contract, Buyer accepts the Property
and all title and survey matters and the Xxxxxxx Money is
non-refundable to Buyer, except as specifically set forth in
this Contract.
(b) Seller has no obligation to cure any matters shown on the
Commitment or the Survey. Notwithstanding the preceding
sentence, Seller shall cure monetary liens that can be cured
solely by the payment of money and shall bond around any
mechanics' or materialmen's lien(s) and abstract(s) of
judgment to Closing Agent's reasonable satisfaction;
provided, that Seller will not be required to expend or, in
the case of a bond, be liable for more than $25,000 for any
single Property to cure any such monetary liens or bond
around any mechanics' or materialmen's lien(s) and
abstract(s) of judgment related to any individual Property.
(c) All exceptions shown on the Commitment, the title exception
documents, or the Survey, except for mechanics' or
materialmen's lien(s) and abstract(s) of judgment which
Seller shall cure to the extent provided in SECTION 3.1(b),
are the PERMITTED EXCEPTIONS. The Permitted Exceptions
include the restriction against conversion of the Real
Property to a condominium regime specified in the Deed
(defined in SECTION 6.2(a)).
(d) At or prior to Closing, the Sellers shall execute and record
a deed restriction (the DEED RESTRICTIONS) in substantially
the form attached to this Contract as EXHIBIT J prohibiting
the imposition of a condominium regime on the Real Property
and Improvements for a period of 15 years after the Closing
Date without the consent of Sellers.
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Section 3.2 Due Diligence Period.
(a) Until this Contract is terminated in accordance with its
terms, Buyer may enter the Real Property and Improvements to
conduct inspections of the Real Property and Improvements,
including any third party inspections, review the Records,
and review and analyze all materials, surveys, maps, and
reports provided by Sellers under this Contract. Buyer must
notify Seller of its or its agents or contractors intention
to enter the Real Property and Improvements at least 24 hours
prior to each intended entry and obtain Sellers' prior
approval, not to be unreasonably withheld, of the proposed
scope of the inspections and tests. No invasive testing or
inspections may be performed without prior written approval
of Sellers, which approval may be withheld or given in
Seller's reasonable discretion. Seller may, at its option,
have a representative present for each inspection or test.
Buyer may not enter into any unit except in accordance with
the Lease and in accordance with applicable law. All
consultants who perform inspections or testing at the Real
Property on behalf of Buyer are subject to Seller's prior
approval, not to be unreasonably withheld.
(b) Buyer acknowledges that it has entered the Real Property and
Improvements prior to the Effective Date to conduct
inspections of the Real Property and Improvements, review the
Records, and review and analyze all materials, surveys, maps,
reports, and other matters and information provided by Seller
under this Contract. By its execution of the Contract, Buyer
accepts the Property and the Xxxxxxx Money is non-refundable
to Buyer, except as specifically set forth in this Contract.
(c) Prior to any entry on the Real Property and Improvements,
Buyer or its Affiliate shall deliver to Sellers a reasonably
satisfactory certificate of insurance evidencing that Buyer
or its Affiliate has commercial general liability insurance
and automobile liability insurance, on an occurrence basis,
with limits of at least $2,000,000 and $1,000,000,
respectively, each issued by an insurance company licensed to
do business in the State where the Real Property is located
and with an A. M. Best Company rating of at least A-VIII and
a reasonably satisfactory endorsement identifying Sellers and
the property management company as additional insureds.
Buyer's or its Affiliate's insurance policies must be primary
with respect to any liability insurance carried by Sellers.
(d) Buyer shall perform, and shall cause its agents, employees,
and contractors to perform, all inspections and reviews of
the Property so as not to cause any damage, loss, cost, or
expense to, or claims against Seller or the Property. Buyer
shall, at its expense, promptly repair any damage to the
Property caused by or attributable to Buyer's inspections or
testing to the condition existing prior to the inspection or
testing. Buyer shall indemnify, defend, and hold Seller and
its property management company and their respective agents
and employees harmless for, from and against any damage,
loss, cost, expense (including, without limitation,
reasonable legal fees, court costs, and expenses), or claims
caused by, attributable to, or resulting from the acts or
omissions on or about the Property by Buyer, its agents,
employees, contractors, or consultants. Notwithstanding the
foregoing, Buyer shall have no liability for pre-existing
conditions discovered by Buyer's tests, inspections or
reviews. Buyer shall cause any lien filed against the Real
Property by a consultant, contractor,
Page 9
subcontractor, or other person or entity arising by, through,
or under Buyer or otherwise attributable to Buyer's
inspection, testing, and review of the Property to be
released of record (whether through payment or bonding)
within 20 days after receipt of notice from Seller of the
filing of any lien. The terms of this SECTION 3.2(d) are not
limited by SECTION 7.3.
(e) Buyer acknowledges that it has reviewed all Service Contracts
listed in EXHIBIT B and all Service Contracts listed in
EXHIBIT B are approved by Buyer and Buyer may not reject any
Service Contract listed in EXHIBIT B. All Service Contracts
listed in EXHIBIT B will be assumed by Buyer at Closing.
Buyer will be liable for any obligations under all Service
Contracts approved by Buyer extending past the Closing Date.
(f) The terms of this SECTION 3.2 survive the Closing or any
termination of this Contract.
ARTICLE 4
SELLER'S REPRESENTATIONS, WARRANTIES, AND COVENANTS
Section 4.1 Seller's Representations and Warranties.
Each Seller for itself and not on behalf of the other Sellers, represents and
warrants to Buyer:
(a) Each Seller is a limited partnership, validly existing and in
good standing under the laws of the State of Delaware, and
is, to the extent necessary, qualified to do business in the
State where its respective Real Property is located.
(b) Each entity comprising Seller has the authority to execute
this Contract and to perform its obligations under this
Contract. The person executing this Contract on behalf of
Seller is duly authorized to do so.
(c) Other than as listed on EXHIBIT K attached hereto and made a
part hereof, there is no pending or, to Seller's knowledge,
overtly threatened litigation, or other process, private or
regulatory, affecting the Property or any entity comprising
Seller that, if decided adversely, would have a Material
Adverse Effect on the use or operation of the Property or
Seller's ability to perform its obligations hereunder.
(d) Seller is in compliance with the requirements of Executive
Order No. 133224, 66 Fed. Reg. 49079 (Sept. 25, 2001) (the
ORDER) and other similar requirements contained in the rules
and regulations of the Office of Foreign Assets Control,
Department of the Treasury (OFAC) and in any enabling
legislation or other Executive Orders or regulations in
respect thereof (the Order and such other rules, regulations,
legislation, or orders are collectively called the ORDERS).
(e) Neither Seller nor any beneficial owner of Seller nor any
Person who provides loans to Seller:
(i) is listed on the Specially Designated Nationals and
Blocked Persons List maintained by OFAC pursuant to
the Order and/or on any other list of terrorists or
terrorist organizations maintained pursuant to any
of the rules
Page 10
and regulations of OFAC or pursuant to any other
applicable Orders (such lists are collectively
referred to as the LISTS);
(ii) is an individual, corporation, partnership, limited
liability company, unincorporated organization,
government or any agency or political subdivision
thereof or any other form of entity (collectively, a
PERSON) who has been determined by competent
authority to be a Person with whom a U.S. Person is
prohibited from transacting business, whether such
prohibition arises under U.S. law, regulation,
executive orders or any lists published by the
United States Department of Commerce, the United
States Department of Treasury or the United States
Department of State including any agency or office
thereof;
(iii) is owned or controlled by, or acts for or on behalf
of, any Person on the Lists or any other Person who
has been determined by competent authority to be a
Person with whom a U.S. Person is prohibited from
transacting business, whether such prohibition
arises under U.S. law, regulation, executive orders
or any lists published by the United States
Department of Commerce, the United States Department
of Treasury or the United States Department of State
including any agency or office thereof; or
(iv) is under investigation by any governmental authority
for, or has been charged with, or convicted of,
money laundering, drug trafficking,
terrorist-related activities, any crimes which in
the United States would be predicate crimes to money
laundering, or any violation of any Anti-Money
Laundering Laws.
For purposes of this Section and Section 5.1, U.S. PERSON
means any United States citizen, any entity organized under
the laws of the United States or its constituent states or
territories, or any entity, regardless of where organized,
with a principal place of business within the United States
or any of its territories. For purposes of this Section and
Section 5.1, ANTI-MONEY LAUNDERING LAWS means those laws,
rules, regulations, orders and sanctions, state and federal,
criminal and civil, that (i) limit the use of and/or seek the
forfeiture of proceeds from illegal transactions; (ii) limit
commercial transactions with designated countries or
individuals believed to be terrorists, narcotic dealers or
otherwise engaged in activities contrary to the interests of
the United States; or (iii) are designed to disrupt the flow
of funds to terrorist organizations. Such laws, regulations
and sanctions are deemed to include the Executive Order
Number 13224 on Terrorism Financing (September 23, 2001), the
Patriot Act; the Currency and Foreign Transactions Reporting
Act (also known as the Bank Secrecy Act, 31), the Trading
with the Enemy Act, 50 U.S.C. Appx. Section 1 et seq., the
International Emergency Economics Powers Act, 50 U.S.C.
Section 1701 et seq., and the sanction regulations
promulgated pursuant thereto by OFAC, as well as laws
relating to prevention and detection of money laundering in
18 U.S.C. Sections 1956 and 1957, as amended.
(f) There are no attachments, executions, assignments for the
benefit of creditors, or voluntary or involuntary proceedings
in bankruptcy or under other debtor relief laws contemplated
by, pending, or, to the Seller's knowledge, threatened
against
Page 11
the Seller, any entity comprising Seller, or the Property.
Seller and any entity comprising Seller has been and will be
solvent at all times prior to and immediately following the
transfer of the Property to Buyer.
(g) The Leases available for review by Buyer are true and correct
copies of the actual Leases in Seller's possession and are
the complete written documentation of the agreement between
Seller, as landlord, and the tenants.
(h) The Service Contracts, Plans, Warranties, Records, and
Reports provided to Buyer by or on behalf of Sellers are true
and correct copies of all such documents.
(i) Except for the Existing Loans that Buyer will assume at
Closing, there are no rights, options, or other agreements of
any kind to purchase or otherwise acquire or sell or
otherwise dispose of the Property or any interest in the
Property.
(j) Except for the consent of (1) the Lenders for Buyer's
assumption of the Existing Loans and (2) the Lender under
that certain mezzanine financing from RAIT Limited
Partnership (RAIT), no further consent, approval,
authorization, order, license, certificate, permit,
registration, designation or filing by or with any third
party or governmental agency or body is necessary for the
execution, delivery and performance of this Contract and the
transactions contemplated hereby by any entity comprising
Seller (although some permits may require assignment or
reapplication with respect to continued operations).
(k) The Seller's execution, delivery and performance of this
Contract and the consummation of the transactions
contemplated hereby have been duly authorized by all
necessary corporate, partnership or limited liability company
action of the Seller and no other action is required by law,
or pursuant to the Seller's limited partnership agreement for
such authorization; this Contract is the legal, valid, and
binding obligation of, and is enforceable against the Seller
in accordance with its terms, except to the extent such
enforcement may be affected by general principles of equity,
or by bankruptcy and other laws affecting the rights of
creditors generally; assuming the consent required of the
Lenders for the assumption of the Existing Loans and the
transfer of the Properties is obtained, the execution and
delivery of this Contract and the compliance with the terms
and conditions of this Contract by the Seller will not breach
or conflict with any of the terms, conditions, or provisions
of any agreement or instrument to which the Seller is a party
or by which the Seller is or may be bound, or constitute a
default thereunder; and, to the Seller's knowledge, and
except as otherwise provided under the Existing Loans, the
authorization, execution, and delivery of this Contract and
the consummation of the transaction contemplated hereby, will
not, with or without the giving of notice or passage of time
or both:
(i) violate, conflict with or result in the breach of
any terms or provisions of, or require any notice,
filing, or consent, which has not been obtained,
under:
(A) the limited partnership agreement of the
Seller; or
Page 12
(B) any statutes, laws, rules, or regulations
of any governmental body applicable to the
Seller; or
(C) any judgment, decree, writ, injunction,
order or award of any arbitrator, court or
governmental authority binding upon either
the Seller or the Property.
(ii) conflict with, result in the breach of any terms or
provisions of, require any notice or consent under,
give rise to a right of termination of, or
constitute a default under, the tenant Leases or any
agreement or instrument of any kind to which the
Seller is a party or by which the Property is bound;
or
(iii) result in any lien, claim, encumbrance or restriction
on the Property.
(l) With respect to the Property, as of the Effective Date of
this Contract:
(i) There are no maintenance, management, or Service
Contracts in effect with respect to or affecting the
Property or any part thereof that will not be
terminated as of the Closing, other than the
agreements set forth in EXHIBIT B.
(ii) There are no persons now employed by Seller or a
Seller Affiliate who Buyer will be obligated to hire
or retain at or after Closing.
(iii) There are no condemnation proceedings pending or, to
the actual knowledge of Seller, threatened against
the Real Property, the Improvements or any part
thereof.
(iv) The Seller has not received any written notice and
to the Seller's knowledge, which knowledge is deemed
to be limited to the environmental reports included
as part of the Reports (collectively, the ESA), and
except for matters and materials present at the Real
Property and Improvements in the ordinary course of
operation of the Real Property and Improvements as
an apartment complex, there are no Hazardous
Materials (defined in SECTION 9.12(a) but excluding
from such definition fungi of all forms and types)
present at the Real Property and Improvements other
than any specified in the ESA. The Seller makes no
representation or warranty relating to fungi of any
form or type.
(v) Except for the Existing Loans, no person or entity
holds or claims a right of first refusal or option
to acquire the Property or, except for the Existing
Loans and the Permitted Exceptions, an interest in
the Property or any part thereof.
(m) Except as included in the Leases or as has been disclosed in
writing to Buyer, there are no other rights of occupancy by
any person.
(n) The Documents required by SECTION 2.2 to be certified by the
Seller as true and correct are true and correct in all
material respects.
Page 13
(o) To the Seller's knowledge, Seller is not in material default
under any of the Leases.
(p) The Seller has no employees.
(q) The list of Personal Property set forth on EXHIBIT C is true,
correct and complete in all material respects. Seller owns
all of the tangible Personal Property which is used in and,
individually or in the aggregate with other such property, is
material to the operation of the Properties; provided,
however, Seller holds no license for the use of the
management software and such software license shall not be
transferred to Buyer. Except for the Existing Loans, to the
Seller's knowledge, such Personal Property is free and clear
of all liens. All Personal Property located at or on the
Property shall remain and not be removed prior to the
Closing, except in the ordinary course of business or for
equipment that becomes obsolete or unusable, which may be
replaced in the ordinary course of business.
(r) The list of Service Contracts set forth on EXHIBIT B is true,
correct and complete in all material respects. To the
Seller's knowledge, no event of default exists (which remains
uncured) under any of the Service Contracts which would have
a Material Adverse Effect. For purposes of this Contract,
MATERIAL ADVERSE EFFECT means an event that would have a
material adverse effect on the business, financial condition
or results of operations of the Property. True and complete
copies of the Service Contracts have been provided to Buyer.
(s) The environmental reports listed in EXHIBIT F are the latest
reports obtained by Seller with respect to the respective
Properties.
(t) The list of documents set forth on EXHIBIT G is a complete
list of all material Loan Documents (as hereinafter defined)
related to the Existing Loans. To the Seller's knowledge, the
Existing Loans and the documents entered into in connection
therewith (collectively, the LOAN DOCUMENTS) are in full
force and effect as of the Effective Date. To the Seller's
knowledge, no event of default or event that with the passage
of time or giving of notice or both would constitute an event
of default has occurred as of the Effective Date under any of
the Loan Documents which would have a Material Adverse
Effect. True and complete copies of the Loan Documents have
been provided to Buyer.
(u) Except as set forth on EXHIBIT L, Seller has received no
written notice concerning the Real Property or the
Improvements from any Governmental Authority stating that the
Real Property or the Improvements are in violation of any
federal, state, county, or city statute, ordinance, code,
rule, or regulation which remains uncured or which, if
uncured at Closing, would have a Material Adverse Effect. The
terms GOVERNMENTAL AUTHORITY and GOVERNMENTAL AUTHORITIES
mean the United States of America, the State, the county, and
city where the Real Property is located, and any other
political subdivision in which the Real Property is located
or that exercises jurisdiction over the Real Property and
Improvements or the construction of multifamily residential
improvements on the Real Property, and any agency,
department, commission, board, bureau, property owners
association, utility district, flood control district,
improvement district, or similar district, or other
instrumentality of any of them.
Page 14
(v) There is no pending or, to Seller's knowledge, threatened
condemnation or change in zoning affecting the Property.
Except as disclosed in writing to Buyer, no portion of any
Property is a designated historic property or located within
a designated historic area.
(w) There are no so-called "redec" or "redecorating fees"
collected from tenants of the Properties.
(x) Each Seller and Designated Owner electing to receive Units
hereunder:
(i) is knowledgeable, sophisticated and experienced in
business and financial matters; each Designated
Owner has previously invested in securities similar
to the Units and fully understands the limitations
on transfer imposed by the federal securities laws
and as described in this Contract. Each Designated
Owner is able to bear the economic risk of holding
the Units for an indefinite period and is able to
afford the complete loss of his, her or its
investment in the Units; each Designated Owner has
received and reviewed all information and documents
about or pertaining to the REIT, the Buyer, the
business and prospects of the REIT and the Buyer and
the issuance of the Units as each Designated Owner
deems necessary or desirable, and has been given the
opportunity to obtain any additional information or
documents and to ask questions and receive answers
about such information and documents, the REIT, the
Buyer, the Properties, the business and prospects of
the REIT and the Buyer and the Units which such
Designated Owner deems necessary or desirable to
evaluate the merits and risks related to its
investment in the Units; and each Designated Owner
understands and has taken cognizance of all risk
factors related to the purchase of the Units. Each
Designated Owner is a sophisticated real estate
investor. In acquiring the Units and engaging in
this transaction, no Designated Owner is relying
upon any representations made to it by the Buyer, or
any of the officers, employees, or agents of the
Buyer not contained herein. Each Designated Owner is
relying upon its own independent analysis and
assessment (including with respect to taxes), and
the advice of such Designated Owner's advisors
(including tax advisors), and not upon that of the
Buyer or any of the Buyer's advisors or affiliates,
for purposes of evaluating, entering into, and
consummating the transactions contemplated by this
Contract. Each Designated Owner represents and
warrants that it has reviewed and approved the form
of the Buyer's Partnership Agreement attached hereto
as EXHIBIT M;
(ii) understands that neither the Units nor the Common
Stock issuable upon redemption of the Units have
been registered under the Securities Act or any
state securities acts and are instead being offered
and sold in reliance on an exemption from such
registration requirements. The Units issuable to
each Designated Owner (or its designee) are being
acquired solely for its own account, for investment,
and are not being acquired with a view to, or for
resale in connection with, any distribution,
subdivision, or fractionalization thereof, in
violation of such laws, and the Designated Owner has
no present intention to enter into any contract,
undertaking, agreement, or arrangement with respect
to any such resale; provided,
Page 15
however, that, at or following Closing, the
Designated Owner may distribute the Units to those
of its members or successors that (1) have
represented and warranted to the Buyer in writing
that, as of the time of such distribution, such
member is an accredited investor as that term is
defined in Rule 501 of Regulation D under the
Securities Act, and (2) have executed the Buyer's
Partnership Agreement as limited partners. Each
Designated Owner understands that any certificates
evidencing the Units will contain appropriate
legends reflecting the requirement that the Units
not be resold without registration under such laws
or the availability of an exemption from such
registration and that the Buyer's Partnership
Agreement will restrict transfer of the Units;
(iii) is an "accredited investor" as that term is defined
in Rule 501 of Regulation D under the Securities Act
of 1933, as amended. Each Designated Owner will
provide the Buyer with a duly executed Accredited
Investor Questionnaire as set forth elsewhere in
this Contract; and
(iv) understands that each Unit shall be redeemable at
the option of the holder, in accordance with, but
subject to the restrictions contained in, the
Buyer's Partnership Agreement; provided, however,
that such redemption option may not be exercised
prior to the first anniversary of the Closing Date.
Section 4.2 Several Liability; Survival of Representations and Warranties.
(a) Notwithstanding anything contained herein to the contrary,
each of the parties comprising Seller shall be responsible
and liable hereunder only with respect to its respective
Property. All covenants and agreements of the Seller under
this Contract shall be the several obligations of such Seller
and shall bind and/or be made by each Seller only as to the
Property owned by such Seller as if a separate agreement had
been executed by and between such respective Seller and Buyer
for each Property. Notwithstanding the foregoing, a default
under this Contract by any Seller shall constitute a default
under this Contract with respect to all Sellers and all
Properties.
(b) The representations and warranties in SECTION 4.1 will be
deemed made on and as of the Closing Date with the same force
and effect as if made at that time and shall survive Closing
for a period of 9 months, at which time they terminate unless
a claim for breach thereof has been instituted within the
11-month period as specified in the next sentence. Buyer may
bring an action against a respective Seller for a material
(defined in SECTION 7.1) breach of any of Seller's
representations and warranties only if (i) Buyer gives such
Seller written notice of the circumstances giving rise to a
material breach within the 11-month period after Closing,
(ii) the aggregate, actual damages from all breaches by such
Seller exceeds $10,000, and (iii) the breach was not waived
pursuant to SECTION 7.1 hereof. Buyer may collect only actual
damages for any breach of Seller's representations and
warranties under this Contract. Buyer and Seller waive the
right to collect special, consequential, incidental,
punitive, or any other damages other than actual damages in
connection with this transaction and this Contract. Except
for (i) any adjustment of the prorations as set forth in
SECTION 6.3, (ii) the warranties in the Deed, the Xxxx of
Sale, and the Assignment of Leases, and
Page 16
(iii) claims in tort which are covered (in whole or in part)
by Seller's liability insurance, (a) any Seller's liability
for damages related to any single Property is limited to
$300,000; provided, that the aggregate liability of all
Sellers for all damages of any kind related to this Contract
or this transaction is limited to and shall not exceed
$300,000 (Buyer hereby waiving the right to claim damages in
excess thereof), except for fraud, and (b) any suit against
Seller for damages must be instituted within 2 years and 1
day after Closing or the damages are thereafter barred.
(c) The provisions of this SECTION 4.2 survive the Closing or any
termination of this Contract.
Section 4.3 Knowledge Standard.
For purposes of this Contract, the terms SELLER'S KNOWLEDGE and BUYER'S
KNOWLEDGE mean the current, actual knowledge of the individuals listed on
EXHIBIT N attached to this Contract, without independent inquiry and without
any actual or implied duty to inquire, and does not include knowledge imputed
to Seller or to the Buyer, as the case may be, from any other person. The named
individuals are acting for and on behalf of Seller or Buyer, as the case may
be, and in a capacity as an officer of Seller or Buyer, respectively or one or
more of Seller's or Buyer's Affiliates and are in no manner expressly or
impliedly making any representations or warranties in an individual capacity.
Buyer and Seller waive any right to xxx or to seek any personal judgment or
claim against any of the named individuals.
Section 4.4 Seller's Covenants.
Each Seller, severally and not jointly, covenants with Buyer as follows:
(a) At all times from the Effective Date to the Closing Date,
Seller shall maintain in force property insurance and
commercial general liability insurance covering the Real
Property and the Improvements in accordance with Seller's
customary procedures.
(b) At all times from the Effective Date to the Closing Date,
Seller shall keep and perform or cause to be kept and
performed all of the material obligations to be performed by
the landlord under the Leases.
(c) Seller shall not, without Buyer's prior consent, which
consent will not be unreasonably withheld or delayed, modify,
terminate, amend, or allow the assignment of existing Leases,
except in accordance with Seller's historical course of
conduct in operating the Property.
(d) After the Effective Date, Seller shall not remove any
Personal Property from the Improvements without replacing it
with items of like kind and quality.
(e) Seller agrees to obtain Buyer's written approval prior to
entering into any new Service Contract that is not terminable
on thirty (30) days notice.
(f) Seller will manage, operate, repair and maintain the Property
in generally the same manner as it managed, operated,
repaired and maintained the same prior to the date hereof
and, to its reasonable ability, will keep the Property in its
Page 17
present state of repair subject to normal wear and tear,
exercising the same degree of care in such matters as Seller
has previously exercised.
(g) Seller shall update the Rent Roll on Buyer's request, but no
more often than once per month. Seller shall not lease any
portion of the Property to any employees of an Affiliate of
Seller, except under leases providing for thirty (30) day
termination by the owner of the Property.
(h) Seller will use its reasonable business efforts to renew all
of the licenses and permits applicable to the Property and
which are necessary for the continued operation of the
Property as they expire from time to time and shall notify
Buyer at least thirty (30) days prior to the expiration date
or threatened cancellation date of any license or operating
permit.
(i) Seller will not cause any action to be taken which would
cause any of the representations or warranties made by Seller
in this Contract to be false on or as of Closing Date.
(j) Seller shall not enter into or record any easement, covenant,
license, permit, agreement or other instrument against the
Property or any portion thereof except as may be required to
enable Seller to perform its obligations under this Contract
or to operate in the ordinary course of business.
(k) Effective as of the Closing, Seller shall terminate all
management agreements relating to the Property.
(l) Seller shall not change the existing use of any Property.
(m) Seller shall not knowingly violate or fail to use
commercially reasonable efforts to prevent the violation of
any applicable laws in any way related to the Property;
however, this is not intended as a representation that there
are no current violations of applicable laws, nor shall it
serve as a covenant to correct violations of laws, if any,
that currently exist;
(n) Seller shall not materially alter the manner of keeping its
books, accounts or records or the accounting methods therein
reflected.
(o) Subsequent to the Closing, but at no cost to Seller, Seller
agrees to reasonably cooperate with Buyer's independent
auditors to provide reasonable and necessary access to
financial records required to permit the preparation and
audit of financial statements of the Properties for the year
2004 pursuant to applicable SEC regulations. This provision
shall survive the Closing.
(p) Seller shall continue to perform all its obligations under
the Existing Loans, and shall not enter into any
modification, amendment or restatement thereof that would
have a Material Adverse Effect without Buyer's consent, which
consent will not be unreasonably withheld.
(q) Seller agrees to expend at least $500,000 in the aggregate,
when combined with the expenditures pursuant to the
Partnership Sale Contract and the Cash Contract, in capital
expenditures on the Properties prior to Closing (the CAPITAL
Page 18
EXPENDITURE AMOUNT). As of the Effective Date, there is
approximately $311,000 in an escrow account held by the
Lenders entitled "Required Repair Fund" (the REQUIRED REPAIR
FUND). All amounts that Seller is reimbursed by the Lenders
prior to Closing from the Required Repair Fund shall be
included in determining if Seller achieves the Capital
Expenditure Amount. If the Seller expends less than $500,000
in capital expenditures on the Properties, when combined with
the expenditures pursuant to the Partnership Sale Contract
and the Cash Contract, prior to Closing, then the Seller
shall pay to the Buyer at Closing the positive difference
between the actual amount of capital expenditures made by the
Seller and $500,000 (the CAPITAL PAYMENT). The Seller may
elect to assign all or a portion of the Required Repair Fund
to Buyer, at no cost to Buyer, as part of the Capital
Payment.
ARTICLE 5
BUYER'S REPRESENTATIONS AND WARRANTIES
Section 5.1 Buyer's Representations and Warranties.
Buyer represents and warrants to each Seller, which representations and
warranties are also deemed to be made on and as of the Closing Date:
(a) Buyer is a limited partnership, validly existing and in good
standing under the laws of the State of Delaware, and, at
Closing, will be, to the extent necessary, qualified to do
business in the States where the each Property is located.
(b) Buyer has the authority to execute this Contract and to
perform its obligations under this Contract. The person
executing this Contract on behalf of Buyer is duly authorized
to do so.
(c) There are no attachments, executions, assignments for the
benefit of creditors, or voluntary or involuntary proceedings
in bankruptcy or under other debtor relief laws contemplated
by, pending, or threatened against Buyer.
(d) Buyer is in compliance with the requirements of the Orders
and other similar requirements contained in the rules and
regulations of the OFAC and in any enabling legislation or
other Executive Orders or regulations in respect thereof.
(e) Neither Buyer nor any beneficial owner of Buyer:
(i) is listed on the Lists;
(ii) is a Person who has been determined by competent
authority to be a Person with whom a U.S. Person is
prohibited from transacting business, whether such
prohibition arises under U.S. law, regulation,
executive orders or any lists published by the
United States Department of Commerce, the United
States Department of Treasury or the United States
Department of State including any agency or office
thereof; or
(iii) is owned or controlled by, or acts for or on behalf
of, any Person on the Lists or any other Person who
has been determined by competent authority to be a
Person with whom a U.S. Person is prohibited from
Page 19
transacting business, whether such prohibition
arises under U.S. law, regulation, executive orders
or any lists published by the United States
Department of Commerce, the United States Department
of Treasury or the United States Department of State
including any agency or office thereof; or
(iv) is under investigation by any governmental authority
for, or has been charged with, or convicted of,
money laundering, drug trafficking,
terrorist-related activities, any crimes which in
the United States would be predicate crimes to money
laundering, or any violation of any Anti-Money
Laundering Laws.
(f) The Units, when issued, will have been duly and validly
authorized and issued, free of any preemptive or similar
rights, and will be fully paid and nonassessable, without any
obligation to restore capital except as required by the
Delaware Revised Uniform Limited Partnership Act (the LIMITED
PARTNERSHIP ACT). Each Designated Owner shall be admitted as
a limited partner of the Buyer as of the Closing Date and
shall be entitled to all of the rights and protections of a
limited partner under the Limited Partnership Act and the
provisions of the Buyer's Partnership Agreement, with the
same rights, preferences, and privileges as all other limited
partners on a pari passu basis. The Common Stock for which
the Units may be redeemed have been validly authorized and
will be duly and validly issued, fully paid and
nonassessable, free of preemptive or similar rights. As more
completely described in the Agreement Regarding Contributed
Properties, a copy of which has been attached hereto as
EXHIBIT O, for purposes of allocating items of income, gain,
loss and deduction with respect to the Properties in the
manner required by Section 704(c) of the Code (hereinafter
defined), the Buyer shall employ, and shall cause any entity
controlled by the Buyer which holds title to the Properties
to employ, the "traditional method" (with curative
allocations on sale) as set forth in Treasury Regulation
section 1.704-3(c).
Section 5.2 Buyer's Covenants.
Buyer covenants and agrees:
(a) to make its policies, procedures and practices regarding
compliance with the Orders, if any, available to Sellers for
their review and inspection during normal business hours and
upon reasonable prior notice.
(b) that if Buyer obtains knowledge that Buyer or any of its
beneficial owners becomes listed on the Lists or is indicted,
arraigned, or custodially detained on charges involving money
laundering or predicate crimes to money laundering, Buyer
shall immediately notify Sellers in writing, and in such
event, Sellers shall have the right to terminate this
Contract without penalty or liability to Buyer immediately
upon delivery of written notice thereof to Buyer.
(c) that Buyer shall continue to use commercially reasonable and
diligent efforts to assume the Existing Loans on terms and
conditions reasonably acceptable to Buyer; provided, that
Buyer is not required to agree to any material change of
Page 20
any term of any Existing Loans document as a condition to
Lenders' approval of the Assumption.
(d) Buyer will forward to Lenders, or a third party entity
designated by Lenders, if applicable, the documentation and
information requested in the loan assumption package, within
10 days after the Effective Date. Buyer acknowledges that
Seller has caused Lenders to deliver to Buyer Lenders' loan
assumption package prior to the Effective Date.
(e) Buyer will, within 10 days after the Effective Date, if
required by Lenders, (i) provide to the Lenders
organizational documents of the Buyer's borrowing entity
(BUYER'S BORROWER), (ii) provide to the Lenders financial
statements of Buyer's Borrower, (iii) authorize the Lenders
to conduct credit reports on the Buyer's Borrower, (iv)
authorize the Lenders to contact other Lenders who hold loans
from entities related to Buyer's Borrower, (v) execute and
return the application for the assumption of the Existing
Loans on the Lenders' approved form, and (vi) pay one-half
(1/2) all processing fees and other expenses required by the
Lenders and Seller shall pay one-half (1/2) all processing
fees and other expenses required by the Lenders.
(f) Buyer will respond timely to all requests from Lenders, but
in no event later than 5 business days and will deliver
copies of all correspondence (other than correspondence
consisting of financial statements and financial condition,
or correspondence deemed by Buyer to be confidential to Buyer
or its Affiliates) between Buyer, Lenders, and any agent of
Lenders to Seller as soon as reasonably practicable.
(g) Buyer shall deliver the executed Tenant Notice Letters to all
tenants within ten (10) days after Closing. This provision
shall survive Closing.
(h) Buyer shall not initiate employment conversations with
Seller's manager's employees until after the earlier of (i)
three (3) business days prior to the Closing Date and (ii)
January 17, 2004.
(i) In the event Sellers elect under the provisions of SECTION
1.2 hereof, to receive any Units, Buyer shall deliver at
Closing to Seller and the Designated Owners an enforceable
commitment (the LIQUIDITY COMMITMENT) whereby the Buyer
agrees to lend to the respective holder of the Units an
amount equal to not more than seventy-five percent (75%) of
the value of the respective Units, the further terms of which
are set forth in the Liquidity Loan Documents (hereinafter
defined).
Any such loan arising out of the Liquidity Commitment shall
be evidenced by documents (the LIQUIDITY LOAN DOCUMENTS)
attached hereto as EXHIBIT P.
If Seller elects, under the provisions of SECTION 1.2(c)(II)
hereof, to acquire any Units at Closing and if the Liquidity
Commitment is delivered at Closing, Buyer's obligation to
pay, as its share of the closing costs, 50% of the negative
arbitrage for the RAIT Loan shall be waived and such cost
shall be fully borne by Seller.
Page 21
ARTICLE 6
CLOSING AND PRORATIONS
Section 6.1 Closing Date.
The CLOSING of this Contract will take place in Title Company's offices
commencing at 10:00 a.m., Dallas, Texas time, or such other place as is
mutually agreeable to the parties upon three (3) business days prior written
notice from Buyer that Buyer has received or will receive the proceeds from the
Public Offering from the underwriter(s) (the PUBLIC OFFERING CLOSING);
provided, however, that this Contract shall terminate if Closing does not occur
prior to January 31, 2005 (the CLOSING DATE). Notwithstanding the foregoing,
Seller acknowledges that it is possible that, due to unanticipated delays in
the regulatory review and approval process associated with the Public Offering
that, the Public Offering Closing may not occur on or before January 31, 2005,
despite the reasonable and diligent efforts of Buyer, the REIT and the
underwriters to cause the Public Offering Closing to occur before such date.
Accordingly, in the event that the Public Offering Closing has not occurred on
or before January 31, 2005, and if Buyer has used reasonable and diligent
efforts to cause the Public Offering Closing to occur before such date and the
failure of the Public Offering Closing to occur is beyond the reasonable
control of Buyer, then the Closing Date shall be automatically extended
hereunder to a date not earlier than three (3) business days after prior
written notice from Buyer to Seller that either the Public Offering Closing has
occurred or is anticipated to occur but in no event later than February 28,
2005; provided that if the Closing has not occurred by February 28, 2005, if
Seller is not then in default hereunder, the Xxxxxxx Money and the Letter of
Credit shall be paid (or delivered, as appropriate) to Seller, this Contract
shall terminate, and the parties shall have no further rights, liabilities or
obligations under this Contract (except for those that expressly survive
termination).
Section 6.2 Closing Matters.
(a) Expressly conditioned upon Buyer's compliance with its
obligations under SECTION 6.2(b), Sellers shall deliver at
Closing:
(i) a Deed (containing special or, as appropriate,
limited warranties of title) for each Property (the
DEED), duly executed and acknowledged by Seller,
containing no exceptions or conditions except the
Permitted Exceptions, conveying to Buyer, fee simple
title to the Real Property and Improvements as
specified in SECTION 2.1(a), substantially in the
form attached to this Contract as EXHIBIT Q;
(ii) at least 2 counterparts of a Xxxx of Sale for each
Property (the XXXX OF SALE), duly executed by
Seller, substantially in the form attached to this
Contract as EXHIBIT R;
(iii) at least 2 counterparts of an Assignment of Leases,
Contracts, Security Deposits, and Warranties for
each Property (the ASSIGNMENT OF LEASES) duly
executed by Seller, substantially in the form
attached to this Contract as EXHIBIT S.
(iv) an IRC Section 1445 Certification, duly executed by
each Seller, substantially in the form attached to
this Contract as EXHIBIT T;
Page 22
(v) at least 1 counterpart of a notice to tenants for
each Property (the TENANT NOTICE LETTER), duly
executed by Seller in substantially the form
attached to this Contract as EXHIBIT U, to be
addressed to each tenant at the Real Property;
(vi) at least 2 counterparts of Restriction Against
Condominium Conversion for each Property (the
RESTRICTION), duly executed and acknowledged by
Seller, substantially in the form attached to this
Contract as EXHIBIT J;
(vii) at least 1 counterpart of all assumption documents
required to be executed by Seller with respect to
Buyer's assumption of the Existing Loans;
(viii) a Rent Roll for each Property dated no earlier than
5 days prior to Closing, certified by Seller to be
true and correct in all material respects;
(ix) a list of aged rent delinquencies for each Property,
identifying each delinquent tenant by name and unit
number, dated no earlier than 5 days prior to the
date Sellers deliver same;
(x) possession of each Property, subject to the
Permitted Exceptions and the rights of tenants in
possession under the Leases; and
(xi) the following to the extent they are in the Seller's
possession or control:
(A) originals (or copies if originals are not
available) of the Leases, the Service
Contracts, the Plans, the Warranties, and
the Records; and
(B) all keys to the Improvements, including,
but not limited to, keys to all door locks
and keys of any vehicles or equipment being
conveyed (and an accounting for keys in
possession of others), which keys shall be
marked and identified; and all documents in
the possession of the Seller, pertaining to
occupants of the Property, including, but
not by way of limitation, all leases,
applications, correspondence and credit
reports relating to each such occupant;
(xii) a fully executed termination of the management
agreement for each Property at Seller's sole cost
and expense;
(xiii) a license in the form attached hereto as EXHIBIT V
authorizing Buyer's continued display of the name
"Jefferson", "Jefferson Commons" and the initials
"JPI" for a period of nine (9) months after the
Closing Date, as well as Buyer's agreement to cause
the removal of such names from the Property by no
later than nine (9) months after the Closing Date
(the LICENSE);
(xiv) such evidence or documents as may be reasonably
required by the Title Company evidencing the status
and capacity of Seller and the authority of
Page 23
the person or persons who are executing the various
documents on behalf of the Seller in connection with
the sale of the Property;
(xv) Seller's executed closing statement confirming the
prorations and the distribution of the closing
proceeds; provided, that the closing statement will
only be delivered to the Title Company and Closing
Agent and will not be delivered to Buyer;
(xvi) if Units are to be issued to any Seller or its
Designated Owners, signature pages of the Buyer's
Partnership Agreement duly executed by the Seller or
the Designated Owners, as applicable, as limited
partner; and
(xvii) a duly executed legal opinion of Seller's counsel in
the form attached hereto as EXHIBIT W.
(b) No later than 4:00 p.m., Dallas, Texas time, on the Closing
Date, Buyer shall deliver to Closing Agent as a condition
precedent to the obligation of Seller to perform its
obligations under SECTION 6.2(a):
(i) by wire transfer or other immediately available
federal funds, the cash portion of the Purchase
Price, subject to applicable prorations and credits;
and
(ii) at least 2 counterparts of the Assignment of Leases
and the Xxxx of Sale, duly executed by Buyer;
(iii) at least 1 counterpart of all assumption documents
with respect to Buyer's assumption of the Existing
Loans, duly executed by Buyer and the respective
Lenders including, without limitation, the Seller
Releases;
(iv) at least 1 counterpart of the Tenant Notice Letter,
duly executed by Buyer;
(v) at least 1 counterpart of the License, duly executed
by Buyer;
(vi) a written confirmation by Buyer dated as of the
Closing Date of the acknowledgements set forth in
SECTION 9.12(a);
(vii) such evidence or documents as may be reasonably
required by the Title Company evidencing the status
and capacity of Buyer and the authority of the
person or persons who are executing the various
documents on behalf of the Buyer in connection with
the purchase of the Property;
(viii) Buyer's executed closing statement confirming the
prorations and the distribution of the closing
proceeds;
(ix) if Units are issued and if the Units are to be
certificated, certificates representing the Units
duly issued by the Buyer in the name of each Seller
and/or each Designated Owner, as applicable, as of
the Closing Date representing the Units to which the
Seller and/or Designated Owner is entitled pursuant
to SECTION 1.2 of this Contract;
Page 24
(x) if Units are to be issued at the Closing, the fully
executed Buyer's Partnership Agreement, with the
originally duly executed signature of Education
Realty OP Limited Partner Trust, a Maryland business
trust which is the wholly owned subsidiary of the
REIT, as general partner, and original or
photostatic copies of the signatures of all limited
partners; and
(xi) if Units are to be issued at Closing, the Liquidity
Commitment.
(c) Each Seller and Buyer shall execute and deliver to the
appropriate parties any additional documents and instruments
that, in the mutual opinion of Buyer's counsel and any
Seller's counsel, are necessary to consummate this
transaction.
Section 6.3 Prorations.
(a) Ad valorem taxes and assessments (whether for real estate or
personal property) against the Property will be prorated at
Closing as of the Closing Date based on the tax bills for the
year of the Closing. Buyer will receive at Closing a credit
against the Purchase Price in an amount equal to the portion
of the taxes and assessments on the Property from the
beginning of the current tax year to the Closing Date. If
Closing occurs before that year's tax bills are available,
the proration will be based on the latest tax rate applied to
the latest unappealed tax value. If an estimated proration is
made, then after the taxes and assessments for the year in
which the Closing occurs are finally assessed, within 30 days
after demand, Buyer shall refund to Seller any amount
overpaid by Seller or Seller shall pay to Buyer the amount of
any deficiency in the proration. Buyer shall pay all taxes
and assessments against the Property before they become
delinquent.
(b) All income and expenses of the Real Property and Improvements
(other than ad valorem taxes and assessments) will be
prorated at Closing as of the Closing Date on an accrual
basis. All rents actually prepaid for a portion of the term
on or after Closing, shall be paid to Buyer at Closing or, at
Seller's option, offset against the Purchase Price. All other
income and expense items subject to proration pertaining to
the period prior to the Closing Date will be allocated to and
paid by Sellers and all income and expense items subject to
proration pertaining to the period starting on the Closing
Date will be allocated to and paid by Buyer. Seller is
responsible for Lease commissions due Seller's employees and
locator fees for Leases under which the tenant moves into a
unit prior to the Closing Date. Buyer is responsible for
locator fees for Leases under which the tenant moves into a
unit on or after the Closing Date. All application fees which
are not prepaid security deposits shall be retained by
Seller. Any income payable in connection with any Service
Contract will be prorated, but no lump sum or up front
payments paid to Seller with respect to any Service Contract
will be prorated. Rent will be prorated based on the Rent
Roll provided by Seller at Closing. No later than 3 business
days prior to the Closing Date, Buyer and each Seller shall
mutually approve and provide to Closing Agent a schedule of
prorations in as complete and accurate a form as possible. No
later than 60 days after Closing, Seller and Buyer shall make
appropriate post-closing adjustments to the prorations of
income and expenses but in no event will any readjustment be
made after the 60th day after the Closing Date, other than a
readjustment of ad valorem taxes and assessments.
Page 25
(c) All Deposits paid as refundable security for rent, cleaning,
pet deposits, or any other purposes will be paid to Buyer at
Closing and the obligation, if any, to refund the cash
deposits to tenants is assumed by Buyer. Except as provided
in SECTION 6.3(d), no non-refundable deposits or fees paid by
tenants shall be paid or payable to Buyer.
(d) Any amounts of so-called "hassle free move-out" payments paid
to Seller for current leases on the Properties shall be
equally split between Seller and Buyer and, at Closing,
Seller shall pay to Buyer its share thereof.
(e) All deposits and escrows made by Seller with the respective
Lenders will be delivered to the Sellers at Closing and will
be retained by the Seller or will be credited to the Seller
at Closing.
(f) The obligations of Sellers and Buyer under this SECTION 6.3
survive the Closing.
Section 6.4 Closing Costs.
Costs of closing this transaction will be allocated between Sellers and Buyer
as follows:
(a) Sellers shall pay (i) 50% of the prepayment premium for the
RAIT Loan to cause RAIT to release at Closing any security
interests in its collateral relating to Seller or its
constituent entities (any escrows held by the Lenders will be
returned to Seller or credited to Seller at Closing), (ii)
the cost of providing the Title Commitment, (iii) if the
Closing occurs on or prior to December 31, 2004, then the
portion (which may be all) of the negative arbitrage
associated with the RAIT Loan from the Closing Date until the
RAIT Loan is prepaid which is not paid by Buyer; (iv) the
cost 50% of any escrow fees or similar charges of Title
Company and Closing Agent, (v) the cost of the premiums for a
"standard coverage" Owner Policy, (vi) 50% of all costs
payable to the Lenders in connection with Buyer's assumption
of the Existing Loans, (vii) 50% of any and all transfer fees
and sales, intangibles, and conveyance taxes (or equivalents)
related to the Closing, if any, and (viii) the costs, if any,
incurred by Seller in connection with the performance of its
obligations under this Contract, including any endorsement to
the Title Policy which Seller, in its sole and absolute
discretion, agrees to obtain in order to cure title defects.
(b) Buyer shall pay (i) any premiums related to title insurance
for extended coverage or any endorsements or modifications to
any policy requested by Buyer and all premiums related to any
mortgagee policy, (ii) the cost of recording the Deed and any
other conveyance documents that Buyer may choose to record,
(iii) 50% of any escrow fee or similar charges of Title
Company and Closing Agent, (iv) the cost of the Survey, (v)
50% of any and all transfer fees and sales, intangibles, and
conveyance taxes (or equivalents) related to the Closing, if
any, (vi) 50% of all costs payable to the Lenders in
connection with Buyer's assumption of the Existing Loans,
(vii) 50% of the prepayment premium for the RAIT Loan to
cause RAIT to release at Closing any security interests in
its collateral relating to Seller or its constituent entities
(any escrows held by the Lenders will be returned to Seller
or credited to Seller at Closing), (viii) subject to SECTION
5.2(i), if the Closing occurs on or prior to December 31,
2004, then 50% of the negative arbitrage associated with the
RAIT Loan from the Closing Date until the RAIT
Page 26
Loan is prepaid, but Buyer shall not be required to pay in
excess of $200,000 in the aggregate with respect to all
Interests or Properties purchased, and (ix) the costs, if
any, incurred by Buyer in connection with the performance of
its obligations under this Contract.
(c) All other expenses incurred by any Seller or Buyer with
respect to the Closing, including, but not limited to, legal
fees of Buyer and each Seller (except in the event of
litigation), will be borne and paid exclusively by the party
incurring same, without reimbursement, except to the extent
otherwise specified in this Contract.
Section 6.5 Assumption Approval.
By no later than 5:00 p.m., Dallas, Texas time on January 18, 2005 (the
ASSUMPTION APPROVAL DATE), Buyer shall either:
(a) terminate this Contract by giving a termination notice to
Sellers stating that the terms of the Assumption are not
acceptable to Buyer, following which Closing Agent shall
deliver the Xxxxxxx Money to Seller (together with all
interest thereon) and the parties shall have no further
rights, liabilities, or obligations under this Contract
(other than those that expressly survive termination); or
(b) waive its right to terminate this Contract for matters
related to the Assumption by proceeding to Closing (absent a
termination pursuant to (a) above, Buyer shall be deemed to
have waived its right to terminate this Contract by virtue of
an unacceptable Assumption).
Buyer covenants to communicate with Sellers and to keep Sellers informed with
respect to the status of the Assumption and the Seller Releases. Buyer will
promptly notify Sellers when each Lender consents to the Assumption and the
Seller Releases. If Buyer is unable to obtain the Seller Releases by noon,
Dallas, Texas time on January 17, 2005, Buyer will promptly notify Sellers in
writing thereof.
Section 6.6 Release Approval.
By no later than the Assumption Approval Date, Sellers shall either:
(a) terminate this Contract by giving a termination notice to
Buyer stating that the terms of the Seller Releases are not
acceptable to Sellers, following which Closing Agent shall
deliver the Xxxxxxx Money to Seller (together with all
interest thereon) and the parties shall have no further
rights, liabilities, or obligations under this Contract (other
than those that expressly survive termination); or
(b) waive its right to terminate this Contract for matters
related to the Seller Releases by proceeding to Closing
(absent a termination pursuant to (a) above, Seller shall be
deemed to have waived its right to terminate this Contract by
virtue of an unacceptable Seller Release);
Section 6.7 Seller's and Buyer's Joint Covenants Regarding Taxation of
Cash/Unit Purchase.
For all federal, state and local income tax purposes:
(a) Buyer and Seller agree to treat the Seller's contribution of
Property to Buyers in exchange for Units as a nontaxable
transaction under Section 721 of the Internal
Page 27
Revenue Code of 1986, as amended (the CODE), and Buyer and
Seller will not take an inconsistent position therewith
except to the extent required by a "determination" as that
term is defined under Section 1313 of the Code.
Notwithstanding anything to the contrary contained in this
Contract, including without limitation the use of words and
phrases such as "sell," "sale," "purchase," and "pay," the
parties agree that it is their intent that to the extent that
consideration for the transfer of the Property takes the form
of the issuance of Units, the transactions contemplated
hereby shall be treated for federal income tax purposes
pursuant to Section 721 of the Code as the contribution of
the Property by the Seller to Buyer, in exchange for the
Units.
(b) Buyer and Seller agree that to the extent there is sufficient
cash transferred by Buyer to Seller under SECTION 1.2(c)(II)
to defease any existing mezzanine loan on the respective
Property plus the payment of Seller's costs under SECTION
6.4(a), it shall be reported under Treasury Regulation
Section 1.707-4(d) in such respective amounts as a transfer
to reimburse the Seller for capital expenditures, and
accordingly, Buyer and Seller will not report such cash
transfers as part of a taxable sale of the Property from
Seller to Buyer. Buyer and Seller agree that they will not
take positions inconsistent with the preceding sentence
except to the extent required by a "determination" as that
term is defined under Section 1313 of the Code.
(c) Buyer and Seller agree that the Existing Loans (together with
any fees and expenses required to be paid to Lenders in
connection with Buyer's Assumption to the extent assumed by
Buyer under SECTION 1.2(c)(i)) will be reported as a
"qualified liability", as that term is defined under Treasury
Regulation Section 1.707-5 and any fees and expenses required
to be paid Lenders in connection with Buyer's Assumption to
the extent satisfied by Buyer will be treated as a qualified
liability assumed by Buyer and that Seller's allocable share
of such qualified liability with respect to its Property will
be treated as a qualified liability. Buyer and Seller agree
that they will not take positions inconsistent with the
preceding sentence except to the extent required by a
"determination" as that term is defined under Section 1313 of
the Code.
Notwithstanding the foregoing, the Buyer makes no representations concerning a
proper treatment of such transactions and shall have no liability if the
contribution and distribution are not so treated. If such treatment is
challenged by any taxing authority on audit or otherwise, then solely with
respect to such issue, (i) the Designated Owners shall have the right to
participate fully, at their own expense, in all aspects of the defense of such
issue, (ii) the Buyer shall not settle any such issue without the prior consent
of the Designated Owners, which consent shall not be unreasonably withheld or
delayed, (iii) the Buyer shall inform the Designated Owners reasonably promptly
in advance, of the date, time and place of all administrative and judicial
meetings, conferences, hearings and other proceedings relating to such issue,
(iv) the Buyer shall provide to the Designated Owners all correspondence with
governmental authorities and other documents relating to such issue promptly
upon receipt, or in advance of submission to (as the case may be) the relevant
taxing authority or court, and (v) the Buyer shall not file or submit any
documents relating to the issue without the prior consent of the Designated
Owners which consent shall not be unreasonably withheld or delayed, provided
that the Buyer may make such filing or submission if required to comply with
any deadline imposed by law or other governmental authority if the Buyer has
made commercially reasonably efforts to obtain such prior consent. At any point
in the defense of
Page 28
such issue, in its sole discretion, the Buyer may, upon notice to the
Designated Owners, elect to have the Designated Owners conduct the defense of
the issue, at the Designated Owners' expense, and retain similar rights with
respect to the defense as those granted to the Designated Owners in the
immediately preceding sentence, provided that the proviso set forth in clause
(ii) of the immediately preceding sentence shall not apply.
ARTICLE 7
DEFAULTS AND REMEDIES
Section 7.1 Material Breach of Seller's Representations and Warranties
Prior to Closing.
Buyer and each Seller shall each notify the other parties to this Contract
promptly upon discovery at or prior to Closing that any of the representations
and warranties of any Seller in SECTION 4.1 are inaccurate in any material
respect. If (i) any of a Seller's representations and warranties in SECTION 4.1
are inaccurate in any material respect at or prior to Closing and (ii) the
Seller does not cure (it being understood that the Seller has no obligation to
cure at any cost to Seller in excess of $25,000 in the aggregate) the material
breach within 10 business days (or within 1 business day if Buyer's notice is
given on the Closing Date) after receipt of notice of the breach from Buyer,
then Buyer shall, as its sole and exclusive remedy, waiving all other remedies,
either:
(a) terminate this Contract by giving notice to each Seller on or
prior to the Closing Date (which will be extended as
necessary to accommodate the applicable cure period); or
(b) waive that representation and warranty in its entirety and
proceed to the Closing.
A breach of any representation and warranty by a Seller is deemed material for
the purposes of this SECTION 7.1 only if it will cause a material adverse
effect, including, without limitation, a financial effect on the Real Property
and Improvements of greater than $200,000 for any single Property and one or
more breaches by Seller of Seller's representations and warranties are deemed
material if they will cause a material adverse financial effect greater than
$300,000 in the aggregate with respect to any or all of the Properties. Any
breach of any representation and warranty by a Seller that is not material is
deemed waived by Buyer and Buyer and each Seller shall proceed with Closing
without any reduction in the Purchase Price. If Seller can effect a cure at a
cost of $25,000 or less in the aggregate, Seller shall effect the cure.
If Buyer terminates this Contract under this SECTION 7.1, then Closing Agent or
Sellers, as applicable, shall return the Xxxxxxx Money and the Letter of Credit
to Buyer and the parties have no further rights, liabilities, or obligations
under this Contract (other than those that expressly survive termination). If
Buyer has actual knowledge of the inaccuracy or breach of any representation or
warranty by any Seller at or prior to Closing and the Closing occurs, Buyer is
deemed to waive the breach of the representation and warranty in its entirety.
Section 7.2 Buyer's Remedies.
(a) Sellers Inability to Convey Title at Closing; Condemnation;
Major Casualty Damage. If:
(i) the Seller's title to the Property at Closing is
subject to any title exception other than the
Permitted Exceptions for any reason other than an
Page 29
affirmative act by any Seller (excluding any
election not to cure any objection by Buyer under
SECTION 3.1) that prevents Seller from having the
title required and the failure is not cured within 1
business day thereafter or Buyer does not waive any
defect in title and accepts the Seller's title as it
exists on the Closing Date;
(ii) condemnation proceedings are initiated against all
or any portion of the Property and Buyer does not
waive its right to terminate this Contract as
specified in SECTION 8.3; or
(iii) a Major Casualty (defined in SECTION 8.3) occurs and
Buyer does not waive its right to terminate this
Contract as specified in SECTION 8.3;
then Buyer shall, as its sole and exclusive remedy, waiving
all other remedies, terminate this Contract by giving notice
to each Seller within 10 days after the event specified in
SECTION 7.2(a)(i) occurs or Seller delivers written notice to
Buyer of the occurrence of an event listed in SECTION
7.2(a)(II) or (III), and Closing Agent shall return the
Xxxxxxx Money and/or the Letter of Credit to Buyer, and the
parties have no further rights, liabilities, or obligations
under this Contract (other than those that expressly survive
termination).
(b) Other Seller Defaults. If (A) any Seller does not timely
perform its obligations under SECTION 6.2(a) for any reason
other than (i) Buyer's failure to timely perform its
obligations under SECTION 6.2(b) or (ii) an act that falls
under SECTION 7.2(a) (or the termination of this Contract
under any applicable provision of this Contract) or (B) any
Seller does not timely perform any of its material
obligations under this Contract other than its obligations
under SECTION 6.2(a) (for any reason other than the
termination of this Contract under any applicable provision
of this Contract) and does not cure the default within 10
business days after receipt of written notice of the default
from Buyer, then Buyer shall, as its sole and exclusive
remedy, waiving all other remedies, either:
(i) enforce specific performance of such Seller's
obligation to convey the Property to Buyer in
accordance with this Contract; or
(ii) terminate this Contract by giving notice to each
Seller within 5 business days thereafter, then
Closing Agent shall return the Xxxxxxx Money and, as
applicable, the Letter of Credit, to Buyer, and the
parties have no further rights, liabilities, or
obligations under this Contract (other than those
that expressly survive termination).
Buyer is deemed to elect to terminate this Contract, receive
a return of the Xxxxxxx Money and, as applicable, the Letter
of Credit as liquidated damages, and waive any right to
enforce specific performance against Sellers unless Buyer
complies with its obligations under SECTION 6.2(b) on the
Closing Date, gives Sellers notice of its intent to enforce
specific performance within 60 days after the Closing Date
and files an action to enforce specific performance against
each Seller in an appropriate State court having jurisdiction
over the Real Property within 2 years and 1 day after the
Closing Date.
Page 30
(c) Seller's Failure or Refusal to Convey Title at Closing.
Except as set forth in SECTION 7.2(a)(i), if Seller fails or
refuses to convey title to Buyer at Closing and Seller does
not remedy the failure or refusal within 7 business days
after receipt of written notice from Buyer, then (1) this
Contract will automatically terminate, (2) Seller will
reimburse Buyer for its actual, verifiable, third party,
out-of-pockets costs with respect to this Contract, the
Partnership Sale Contract and the Cash Contract in an
aggregate amount not to exceed $750,000, and (3) Closing
Agent shall return the Xxxxxxx Money and, as applicable, the
Letter of Credit, to Buyer and the parties have no further
rights, liabilities, or obligations under this Contract
(other than those that expressly survive termination).
Section 7.3 Seller's Remedies.
If:
(a) Buyer does not timely perform in accordance with SECTION
6.2(b) for any reason, except the termination of this
Contract under any applicable provision of this Contract; or
(b) Buyer is otherwise in default in the performance of any of
its material obligations under this Contract and does not
cure the default within 10 days after receipt of notice of
the default from any Seller (but no Seller is required to
give Buyer notice of default in the performance of Buyer's
obligations under SECTION 6.2(b) or any other obligation
involving the payment of money);
then, Sellers shall, as their sole and exclusive remedy, waiving all other
remedies, terminate this Contract by giving notice to Buyer, Closing Agent
shall pay the Xxxxxxx Money and, as applicable, shall deliver the Letter of
Credit to Sellers and Sellers will retain all Xxxxxxx Money or funds from the
Letter of Credit as liquidated damages, and the parties have no further rights,
liabilities, or obligations under this Contract (except for those that
expressly survive termination). The parties agree that Sellers' damages are
difficult to ascertain and that the Xxxxxxx Money is a fair approximation of
Sellers' damages. Notwithstanding anything to the contrary in this SECTION 7.3,
Buyer's indemnity obligations under SECTION 3.2(d) of this Contract are
separate and distinct obligations that are not subject to the liquidated damage
provisions contained in this SECTION 7.3. Buyer's and its issuers obligations
under the Letter of Credit will survive the termination of this Contract.
ARTICLE 8
CASUALTY AND CONDEMNATION
Section 8.1 Risk of Loss and Notice.
Subject to all other provisions of the Contract, including without limitation,
SECTION 3.2(d), the risk of loss or damage to the Real Property and
Improvements by fire or other casualty prior to the Closing Date is borne by
Sellers. Each Seller shall give Buyer prompt notice of any destruction of any
part of the Real Property and Improvements or the commencement of any
condemnation proceedings against the Real Property and Improvements between the
Effective Date and the Closing Date.
Page 31
Section 8.2 Minor Casualty.
Whether or not the notice required by SECTION 8.1 is given, if Improvements are
destroyed by fire or other casualty and the estimated cost of repairs, as
reasonably determined by Sellers based on a report by an independent
construction or architectural firm, is $500,000 or less for any individual
Property (a MINOR CASUALTY), Closing will occur with no reduction in the
Purchase Price and at Closing:
(a) Seller shall assign to Buyer all proceeds of property
insurance payable to Seller, less any amounts paid by Seller
to repair, restore, or clean up the Real Property and
Improvements;
(b) Buyer will receive a credit against the Purchase Price equal
to the amount of any unused deductible under Seller's
property insurance policy;
(c) Buyer shall accept the Real Property and remaining
Improvements in their damaged state; and
(d) as between Buyer and Sellers, Sellers have no obligation to
repair or restore any damaged or destroyed portions of the
Real Property and Improvements.
Section 8.3 Major Casualty and Condemnation.
If condemnation proceedings are commenced against any portion of the Real
Property and Improvements, or if Improvements are destroyed by fire or other
casualty and the estimated cost of repairs, as reasonably determined by Sellers
based on a report by an independent construction or architectural firm, is more
than $500,000 for any individual Property (a MAJOR CASUALTY), and Buyer has not
waived the exercise of its remedies under SECTION 7.2(a) within 10 days after
notice from any Seller of the occurrence of a Major Casualty or the initiation
of condemnation proceedings, then this Contract automatically terminates and
Buyer is deemed to have exercised its remedies under SECTION 7.2(a). If Buyer
waives the exercise of its remedies under SECTION 7.2(a) within 10 days after
notice from any Seller of the occurrence of a Major Casualty or the initiation
of condemnation proceedings, then Closing will occur without reduction in the
Purchase Price and at Closing:
(a) Seller shall assign its interest in all proceeds of property
insurance or condemnation awards to Buyer, less any amounts
paid by Seller to repair, restore, or clean up the Real
Property and Improvements;
(b) if a Major Casualty occurs:
(i) Buyer will receive a credit against the Purchase
Price equal to the amount of any unused deductible
under Seller's property insurance policy;
(ii) Buyer will accept the Real Property and remaining
Improvements in their damaged state; and
(iii) as between Buyer and Sellers, Sellers have no
obligation to repair or restore any damaged or
destroyed portions of the Real Property and
Improvements; and
Page 32
(c) if condemnation proceedings are begun:
(i) Buyer will accept the Real Property and remaining
Improvements subject to the condemnation
proceedings;
(ii) Sellers have no liability with respect to any
portion of the Real Property and Improvements that
is condemned, or with respect to any costs or
expenses incurred by Buyer as a result of any
condemnation proceedings; and
(iii) Sellers shall reasonably cooperate with Buyer in any
condemnation proceedings.
ARTICLE 9
MISCELLANEOUS
Section 9.1 Notices.
All notices, requests, approvals, consents, and other communications required
or permitted under this Contract (NOTICES) must be in writing and are
effective:
(a) on the business day sent if (i) sent by fax prior to 5:00
p.m. Dallas, Texas time, (ii) the sending fax generates a
written confirmation of sending, and (iii) a confirming copy
is sent on the same business day by one of the other methods
specified below;
(b) on the next business day after delivery, on a business day,
to a nationally recognized overnight courier service for
prepaid overnight delivery;
(c) 3 days after being deposited on a business day in the United
States mail, certified, return receipt requested, postage
prepaid, or
(d) upon receipt if delivered by any method other than the
methods specified above;
in each instance addressed to Buyer or a Seller, as the case may be, at the
following addresses, or to any other address either party may designate by 10
days' prior notice to the other party:
Seller: c/o JPI
000 Xxxx Xxx Xxxxxxx Xxxx., Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Xxxxxx X. Page
Telephone: (000) 000-0000
Fax: (000) 000-0000
E-Mail: xxxxx@xxx.xxx
Page 33
c/o JPI
000 Xxxx Xxx Xxxxxxx Xxxx., Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Xxxx Xxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
E-Mail: xxxxxxx@xxx.xxx
With a copy to:
Xxxxxx Xxxxx Xxxx & Xxxx, P.C.
0000 Xxxxxxxx Xxxxx
0000 Xxxx Xxxxxx
Xxxxxx, Xxxxx 00000-0000
Attention: Xxxxx Xxxxxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
E-Mail: xxxxxxxxxx@xxxxxx.xxx
Buyer: Education Realty Operating Partnership, LP
000 Xxx Xxxxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxxxx 00000
Attention: Xxxx X. Xxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
E-Mail: xxxxxx@xxxxx.xxx
With a copy to:
Martin, Tate, Xxxxxx & Xxxxxxx, P. C.
0000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxxx 00000-0000/
Attention: Xxx Xxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
E-Mail: xxxxxx@xxxxxxxxxx.xxx
With a copy to:
Xxxxxx, Xxxxxxx & Xxxxxx, LLP
1600 Atlanta Financial Center
0000 Xxxxxxxxx Xxxx, X.X.
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxxxx Xxxxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
E-Mail: xxxxxxxxx@xxxxxx.xxx
Page 34
Each party shall use commercially reasonable efforts to send a copy of any
notice of termination under this Contract to Closing Agent on the same date and
by the same method(s) as it is sent to the other party. The failure to send a
copy of any termination notice to Closing Agent does not invalidate an
otherwise valid termination notice. E-mail addresses are included in this
SECTION 9.1 for convenience only: e-mail is not an acceptable form for Notices
under this Contract.
Section 9.2 Performance.
Time is of the essence in the performance of this Contract.
Section 9.3 Binding Effect.
This Contract is binding upon and inures to the benefit of the successors and
assigns of the parties.
Section 9.4 Entire Agreement.
This Contract, the Exhibits to this Contract and any agreements called for by
this Contract supercede the existing letter of intent between the parties dated
July 2, 2004, embody the complete agreement between the parties and cannot be
varied except by written agreement of each Seller and Buyer. No delay or
omission in the exercise of any right or remedy accruing to Seller or Buyer
upon any breach under this Contract shall impair such right or remedy or be
construed as a waiver of any such breach theretofore or thereafter occurring.
The waiver by Seller or Buyer of any breach of any term, covenant, or condition
herein stated shall not be deemed to be a waiver of any other breach, or of a
subsequent breach of the same or any other term, covenant, or condition herein
contained.
Section 9.5 Assignment.
(a) This Contract may not be assigned by a party without the
prior consent of the other party except that the Buyer may
assign its rights and obligations to an Affiliate (defined
below). Any assignee of assignor's interest in this Contract
is bound by all approvals and waivers, actual and deemed, by
assignor prior to the assignment, and must assume in writing
all of assignor's obligations under this Contract. Assignor
is not released from the obligations created under this
Contract as a result of any permitted assignment. Upon
Buyer's written request received by Seller at least ten (10)
days prior to the Closing Date, Seller will cause the various
Properties to be conveyed at Closing to various specified
Affiliates of Buyer set forth in Buyer's request.
(b) Upon any assignment of this Contract, assignor shall promptly
deliver to the other party a fully executed original of the
assignment of this Contract and the assumption by the
assignee of assignor's obligations under this Contract, which
assignment must include the federal tax identification number
of the assignee.
(c) No consent given by a party to any transfer or assignment of
assignor's rights or obligations under this Contract may be
construed as a consent to any other transfer or assignment of
assignor's rights or obligations. No transfer or assignment
in violation of this SECTION 9.5 is valid or enforceable.
Page 35
(d) An AFFILIATE of an entity is any entity that controls, is
controlled by, or is under common control with the entity in
question. The term CONTROL means the possession, directly or
indirectly, of the power to direct or cause the direction of
the management and policies of an entity, whether through the
ownership of voting securities or otherwise.
Section 9.6 Commissions.
Each party hereby warrants to the other party that it has not dealt with any
real estate broker or salesman in the negotiation of this Contract. Each party
shall indemnify, defend, and hold harmless the other party against any real
estate commissions due by virtue of the execution or Closing of this Contract,
the obligation or asserted claim for which arises from actions taken or claimed
to be taken by or through the indemnifying party. The provisions of this
SECTION 9.6 survive the Closing or any earlier termination of this Contract.
Section 9.7 Headings.
Section headings or captions are used in this Contract for convenience only and
do not limit or otherwise affect the meaning of any provision of this Contract.
Section 9.8 Holidays, Etc.
Whenever any time limit or date provided herein falls on a Saturday, Sunday, or
legal holiday under the laws of the State of Texas or the State where the Real
Property is located or on a day when federal banks are closed, then that date
is extended to the next day that is not a Saturday, Sunday, or legal holiday or
a day when federal banks are closed. The term BUSINESS DAY as used in this
Contract means any day that is not a Saturday, Sunday, or legal holiday under
the laws of the State of Texas or the State where the Real Property is located
or a day when federal banks are closed.
Section 9.9 Legal Fees.
If there is litigation, arbitration, or mediation concerning the interpretation
or enforcement of this Contract or any portion of this Contract, the prevailing
party, upon a final non-appealable judgment has been entered in a court of
competent jurisdiction, is entitled to recover from the losing party its
reasonable legal fees and paraprofessional fees, court costs, and expenses. The
provisions of this SECTION 9.9 survive the Closing or any earlier termination
of this Contract.
Section 9.10 Governing Law.
The laws of the State where the Real Property is located govern this Contract.
Section 9.11 Severability.
If any provision in this Contract is unenforceable in any respect, the
remainder of this Contract remains enforceable and, in lieu of the
unenforceable provision, there will be added to this Contract upon the
agreement of Buyer and Seller, a provision as similar in terms to the
unenforceable clause as may be possible and be enforceable.
Page 36
Section 9.12 Disclaimers, Waivers, and Releases.
Buyer acknowledges and agrees that:
(a) EXCEPT AS MAY BE SPECIFICALLY STATED IN THE DEED, OTHER
CLOSING DOCUMENTS, OR IN SECTION 4.1, SELLER, FOR ITSELF AND
ON BEHALF OF JPI APARTMENT CONSTRUCTION, L.P., JPI APARTMENT
MANAGEMENT, L.P., JPI APARTMENT DEVELOPMENT, L.P., JPI
CONSTRUCTION, L.P., JPI LIFESTYLE APARTMENT COMMUNITIES,
L.P., JPI INVESTMENT COMPANY, L.P. AND THEIR RELATED
AFFILIATES (COLLECTIVELY, THE "SELLER AFFILIATES"),
SPECIFICALLY DISCLAIMS, AND BUYER EXPRESSLY WAIVES, ANY
WARRANTY, GUARANTY, OR REPRESENTATION, ORAL OR WRITTEN, PAST,
PRESENT, OR FUTURE, OF, AS, TO, OR CONCERNING: (I) THE NATURE
AND CONDITION OF THE PROPERTY, INCLUDING, WITHOUT LIMITATION,
THE WATER, SOIL, AND GEOLOGY, AND THE SUITABILITY OF THE REAL
PROPERTY AND IMPROVEMENTS FOR ANY AND ALL ACTIVITIES AND USES
THAT BUYER MAY ELECT TO CONDUCT THEREON; (II) MATTERS OF
TITLE; (III) THE NATURE, ENFORCEABILITY, AND EXTENT OF ANY
RIGHT-OF-WAY, LEASE, LIEN, ENCUMBRANCE, LICENSE, RESERVATION,
CONDITION, OR OTHERWISE RELATING TO THE REAL PROPERTY AND
IMPROVEMENTS; (IV) THE COMPLIANCE OF THE REAL PROPERTY AND
IMPROVEMENTS OR THE OPERATION THEREOF WITH ANY LAWS, RULES,
ORDINANCES, OR REGULATIONS OF ANY GOVERNMENTAL AUTHORITY OR
OTHER BODY, INCLUDING, WITHOUT LIMITATION, THE AMERICANS WITH
DISABILITIES ACT OR THE FAIR HOUSING ACT, AS AMENDED FROM
TIME TO TIME; (V) WHETHER THE IMPROVEMENTS ARE BUILT IN A
GOOD AND WORKMANLIKE MANNER; (VI) ZONING TO WHICH THE REAL
PROPERTY AND IMPROVEMENTS OR ANY PORTION THEREOF MAY BE
SUBJECT; (VII) THE AVAILABILITY OF ANY UTILITIES TO THE REAL
PROPERTY AND IMPROVEMENTS OR ANY PORTION THEREOF, INCLUDING,
WITHOUT LIMITATION, WATER, SEWAGE, GAS, ELECTRIC, PHONE, AND
CABLE; (VIII) USAGES OF ADJOINING PROPERTY; (IX) ACCESS TO
THE REAL PROPERTY AND IMPROVEMENTS OR ANY PORTION THEREOF;
(X) THE VALUE, COMPLIANCE WITH ANY PLANS AND SPECIFICATIONS
PROVIDED BY SELLER, SIZE, LOCATION, AGE, USE, DESIGN,
QUALITY, DESCRIPTION, SUITABILITY, STRUCTURAL INTEGRITY,
OPERATION, TITLE TO, OR PHYSICAL OR FINANCIAL CONDITION OF
THE REAL PROPERTY AND IMPROVEMENTS OR ANY PORTION THEREOF, OR
ANY INCOME, EXPENSES, CHARGES, LIENS, ENCUMBRANCES, RIGHTS,
OR CLAIMS ON OR AFFECTING OR PERTAINING TO THE REAL PROPERTY
AND IMPROVEMENTS OR ANY PART THEREOF; (XI) THE EXISTENCE OR
NON-EXISTENCE OF UNDERGROUND STORAGE TANKS; (XII) ANY OTHER
MATTER AFFECTING THE STABILITY OR INTEGRITY OF THE REAL
PROPERTY AND IMPROVEMENTS; (XIII) THE POTENTIAL FOR FURTHER
DEVELOPMENT OF THE REAL PROPERTY AND IMPROVEMENTS; (XIV) THE
EXISTENCE OF VESTED LAND USE, ZONING, OR BUILDING
ENTITLEMENTS AFFECTING THE REAL PROPERTY AND IMPROVEMENTS;
(XV) TAX CONSEQUENCES (INCLUDING, BUT NOT LIMITED TO, THE
AMOUNT OF, USE OF, OR PROVISIONS RELATING TO ANY TAX
CREDITS); (XVI) WARRANTIES (EXPRESS OR IMPLIED) OF CONDITION
REGARDING THE FITNESS OF THE REAL PROPERTY AND IMPROVEMENTS
FOR A PARTICULAR PURPOSE, MERCHANTABILITY, TENANTABILITY,
HABITABILITY, OR SUITABILITY FOR ANY INTENDED USE; (XVII) ANY
ENVIRONMENTAL CONDITIONS THAT MAY EXIST ON THE REAL PROPERTY
AND IMPROVEMENTS, INCLUDING, WITHOUT LIMITATION, THE
EXISTENCE OR NON-EXISTENCE OF PETROLEUM PRODUCTS, PETROLEUM
RELATED PRODUCTS, FUNGI OF ALL FORMS AND TYPES, "HAZARDOUS
SUBSTANCES," "HAZARDOUS MATERIALS," "TOXIC SUBSTANCES," OR
"SOLID WASTES" AS THOSE TERMS (WHICH ARE COLLECTIVELY
REFERRED TO IN THIS CONTRACT AS "HAZARDOUS MATERIALS")
Page 37
ARE DEFINED IN THE COMPREHENSIVE ENVIRONMENTAL RESPONSE
COMPENSATION AND LIABILITY ACT OF 1980, AS AMENDED BY
SUPERFUND AMENDMENTS AND REAUTHORIZATION ACT OF 1986, THE
RESOURCE CONSERVATION AND RECOVERY ACT OF 1976 ("RCRA"), AND
THE HAZARDOUS MATERIALS TRANSPORTATION ACT, AND STATE
ENVIRONMENTAL LAWS, AND IN THE REGULATIONS PROMULGATED
PURSUANT TO THOSE LAWS, ALL AS AMENDED (COLLECTIVELY, THE
"HAZARDOUS WASTE LAWS") AND BUYER RELEASES AND WAIVES ANY
CLAIMS OR CAUSES OF ACTION AGAINST EACH SELLER, EACH SELLER'S
AGENTS AND SELLER'S AFFILIATES BASED IN WHOLE OR IN PART ON
ANY VIOLATION OF, OR ARISING WITH RESPECT TO, ANY FEDERAL,
STATE, OR LOCAL STATUTE, ORDINANCE, RULE, OR REGULATION
RELATING THERETO; AND (XVIII) THE FINANCIAL EARNING CAPACITY
OR HISTORY OR EXPENSE HISTORY OF THE OPERATION OF THE REAL
PROPERTY AND IMPROVEMENTS.
(b) BUYER SHALL PERFORM ALL INVESTIGATIONS OF THE PROPERTY IT
DEEMS NECESSARY DURING THE DUE DILIGENCE PERIOD AND WILL RELY
SOLELY ON ITS OWN INVESTIGATIONS. ANY PLANS OR SPECIFICATIONS
PROVIDED BY SELLERS ARE PROVIDED SOLELY FOR CONVENIENCE AND
BUYER IS RELYING SOLELY ON ITS OWN PHYSICAL INVESTIGATION OF
THE PROPERTY AND IS NOT RELYING ON THE ACCURACY OF ANY PLANS
OR SPECIFICATIONS. IF BUYER DOES NOT TERMINATE THIS CONTRACT
PRIOR TO THE EXPIRATION OF THE DUE DILIGENCE PERIOD, BUYER
ACCEPTS THE PROPERTY AS CONSTRUCTED REGARDLESS OF WHETHER THE
IMPROVEMENTS AS CONSTRUCTED CONFORM TO ANY PLANS OR
SPECIFICATIONS. BUYER ACKNOWLEDGES THAT THE IMPROVEMENTS AS
CONSTRUCTED MAY NOT AND VERY LIKELY DO NOT CONFORM IN ALL
RESPECTS TO THE PLANS AND SPECIFICATIONS AND BUYER HEREBY
WAIVES ANY CLAIMS IT MAY HAVE AS A RESULT OF ANY
NON-CONFORMITY OF ANY IMPROVEMENTS AS ACTUALLY CONSTRUCTED
WITH THE PLANS AND SPECIFICATIONS. BUYER IS NOT AND WILL NOT
RELY ON ANY INFORMATION PROVIDED OR NOT PROVIDED TO BUYER BY
SELLER TO MAKE A DECISION CONCERNING THE PURCHASE OR
NON-PURCHASE OF THE PROPERTY. ALL SELLER INFORMATION (DEFINED
BELOW) IS SUBJECT TO BUYER'S VERIFICATION AND, REGARDLESS OF
BUYER'S FAILURE TO SO VERIFY THE SELLER INFORMATION, BUYER
WILL NOT HOLD SELLER OR ANY SELLER AFFILIATE LIABLE FOR OR
MAKE ANY CLAIMS AGAINST ANY SELLER OR ANY SELLER AFFILIATE AS
TO THE ACCURACY OR INACCURACY OF ANY SELLER INFORMATION.
(c) BUYER REPRESENTS AND WARRANTS TO EACH SELLER THAT BUYER'S
OPPORTUNITY FOR INSPECTION AND INVESTIGATION OF THE PROPERTY
(AND OTHER PARCELS IN PROXIMITY THERETO) WILL BE ADEQUATE TO
ENABLE BUYER TO MAKE BUYER'S OWN DETERMINATION WITH RESPECT
TO THE ACQUISITION OR NON-ACQUISITION OF THE PROPERTY AND THE
PRESENCE OR DISPOSAL ON OR BENEATH THE REAL PROPERTY AND
IMPROVEMENTS (AND OTHER PARCELS IN PROXIMITY THERETO) OF
HAZARDOUS MATERIALS. BUYER ACCEPTS THE RISK OF THE PRESENCE
OR DISPOSAL OF HAZARDOUS MATERIALS ON OR NEAR THE REAL
PROPERTY AND IMPROVEMENTS.
(d) NO REPRESENTATIONS HAVE BEEN MADE BY ANY SELLER, ANY SELLER
AFFILIATE, OR ANY OF THEIR RESPECTIVE AGENTS, BROKERS, OR
EMPLOYEES, AND BUYER HAS NOT RELIED ON ANY INFORMATION
SUPPLIED BY ANY SELLER IN ENTERING INTO, CONTINUING THE
EFFECTIVENESS OF, OR CLOSING UNDER THIS CONTRACT OTHER THAN
SELLERS' REPRESENTATIONS AND WARRANTIES SPECIFIED IN SECTION
4.1. WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, BUYER
ACKNOWLEDGES, WARRANTS, AND REPRESENTS TO EACH SELLER THAT NO
SELLER NOR ANY SELLER
Page 38
AFFILIATE, OR ANY OF THEIR RESPECTIVE AGENTS, BROKERS, OR
EMPLOYEES HAS MADE ANY REPRESENTATION OR STATEMENT TO BUYER
CONCERNING THE VALUE OF THE PROPERTY OR THE PROPERTY'S
INVESTMENT POTENTIAL OR RESALE AT ANY FUTURE DATE, AT A
PROFIT OR OTHERWISE, NOR HAS ANY SELLER OR ANY SELLER
AFFILIATE OR THEIR RESPECTIVE AGENTS, BROKERS, OR EMPLOYEES
RENDERED ANY ADVICE OR EXPRESSED ANY OPINION TO BUYER
REGARDING ANY INCOME TAX CONSEQUENCES OF OWNERSHIP OF THE
PROPERTY.
(e) BUYER REPRESENTS AND WARRANTS TO EACH SELLER THAT BUYER IS
RELYING SOLELY ON BUYER'S INDEPENDENT ANALYSIS AND
INVESTIGATION OF THE PROPERTY AND BUYER ASSUMES THE RISK THAT
AN ADVERSE CONDITION OF THE PROPERTY MAY NOT HAVE BEEN
REVEALED BY ITS OWN DUE DILIGENCE. NO SELLER HAS ANY DUTY TO
INFORM, ADVISE, OR OTHERWISE PROVIDE INFORMATION TO BUYER
THAT THE SELLER MAY HAVE REGARDING THE PROPERTY EXCEPT AS
EXPRESSLY REQUIRED IN THIS CONTRACT. ANY INFORMATION,
DOCUMENTS, OR REPORTS SUPPLIED OR MADE AVAILABLE BY A SELLER,
WHETHER WRITTEN OR ORAL, OR IN THE FORM OF MAPS, SURVEYS,
PLATS, SOIL REPORTS, ENGINEERING STUDIES, ENVIRONMENTAL
STUDIES, OPERATION STATEMENTS, RENT ROLLS, OR OTHER
INSPECTION REPORTS PERTAINING TO THE PROPERTY (INCLUDING,
WITHOUT LIMITATION, THE REPORTS) (COLLECTIVELY "SELLER
INFORMATION") ARE BEING DELIVERED TO BUYER ON AN AS-IS, WHERE
IS, AND WITH ALL FAULTS BASIS, SOLELY AS A COURTESY. SELLER
HAS NEITHER VERIFIED THE ACCURACY OF ANY STATEMENTS OR OTHER
INFORMATION IN ANY OF THE SELLER INFORMATION, NOR ANY METHOD
USED TO COMPILE THE SELLER INFORMATION, NOR THE
QUALIFICATIONS OF THE PERSON(S) PREPARING THE SELLER
INFORMATION. SELLER MAKES NO, AND BUYER WAIVES ANY,
REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, OR ARISING BY
OPERATION OF LAW AS TO THE ACCURACY, COMPLETENESS, OR ANY
OTHER ASPECT OF THE SELLER INFORMATION.
(f) EXCEPT AS SET FORTH IN THE CLOSING DOCUMENT OR SECTION 4.1,
NO SELLER NOR ANY SELLER AFFILIATE IS RESPONSIBLE OR LIABLE
TO BUYER OR ANY SUCCESSOR OR ASSIGNEE OF BUYER, AND BUYER, ON
ITS OWN BEHALF AND ON BEHALF OF ITS SUCCESSORS AND ASSIGNS,
RELEASES AND COVENANTS NOT TO XXX ANY SELLER OR ANY SELLER
AFFILIATE FOR ANY CONSTRUCTION OR DESIGN DEFECTS, ERRORS, OR
OMISSIONS, OR ON ACCOUNT OF ANY OTHER CONDITIONS AFFECTING
THE PROPERTY, KNOWN OR UNKNOWN. EXCEPT AS SET FORTH IN THE
CLOSING DOCUMENT OR SECTION 4.1, BUYER IS PURCHASING THE
PROPERTY AS IS, WHERE IS, AND WITH ALL FAULTS. EXCEPT AS SET
FORTH IN THE CLOSING DOCUMENT OR SECTION 4.1, BUYER RELEASES
SELLER AND ALL SELLER AFFILIATES AND THEIR RESPECTIVE
EMPLOYEES, OFFICERS, DIRECTORS, REPRESENTATIVES, AND AGENTS
FOR ANY COST, LOSS, LIABILITY, DAMAGE, EXPENSE, DEMAND,
ACTION, OR CAUSE OF ACTION ARISING FROM OR RELATED TO ANY
CONSTRUCTION OR DESIGN DEFECTS, ERRORS, OMISSIONS, OR OTHER
CONDITIONS AFFECTING THE PROPERTY, KNOWN OR UNKNOWN. THIS
RELEASE WILL BE GIVEN FULL FORCE AND EFFECT ACCORDING TO EACH
OF ITS EXPRESS TERMS AND PROVISIONS, INCLUDING, WITHOUT
LIMITATION, THOSE RELATING TO UNKNOWN CLAIMS, DAMAGES, AND
CAUSES OF ACTION. THIS COVENANT RELEASING EACH SELLER AND ALL
SELLER AFFILIATES IS A COVENANT RUNNING WITH THE PROPERTY AND
IS BINDING UPON BUYER, ITS SUCCESSORS AND ASSIGNS.
THE PROVISIONS OF THIS SECTION 9.12 SURVIVE THE CLOSING OR ANY EARLIER
TERMINATION OF THIS CONTRACT.
Page 39
Section 9.13 Rule of Construction.
Each party and its counsel have reviewed and revised this Contract. The normal
rule of construction to the effect that any ambiguities are to be resolved
against the drafting party may not be employed in the interpretation of this
Contract or any amendments, schedules, or exhibits to this Contract.
Section 9.14 Effective Date.
The EFFECTIVE DATE of this Contract is September 17, 2004.
Section 9.15 Independent Contract Consideration.
Of the Xxxxxxx Money, $100.00 shall be deemed to be independent consideration
for the options granted in this Contract. Such independent consideration is
deemed to be earned upon the final execution of this Contract by all parties
and is non-refundable to Buyer; therefore, in the event Buyer terminates this
Contract for any reason and the Xxxxxxx Money is thereupon returnable to Buyer,
notwithstanding anything contained herein to the contrary, $100.00 of such
Xxxxxxx Money shall be tendered to Seller.
Section 9.16 Counterparts and Facsimile Signatures.
This Contract may be executed in one or more counterparts. Each counterpart is
an original and proof of this Contract may be made without more than one
counterpart. Facsimile signatures are binding on the party providing the
facsimile signatures.
Section 9.17 No Recording.
Buyer covenants that neither it nor any successor or assign will record in any
public real property records this Contract or any memorandum or affidavit
relating to this Contract or otherwise cloud title to the Property. In addition
to Seller's remedies in SECTION 7.3, if Buyer breaches this SECTION 9.17, Buyer
will record a release of any such memorandum or affidavit no later than five
(5) days after request by Seller. This SECTION 9.17 survives the Closing or
earlier termination of this Contract and Seller may enforce specific
performance of Buyer's obligations under this SECTION 9.17.
Section 9.18 Further Acts.
In addition to the acts, instruments and agreements recited herein and
contemplated to be performed, executed and delivered by Buyer and Seller, Buyer
and Seller shall perform, execute, and deliver or cause to be performed,
executed, and delivered at the Closing or after the Closing, any and all
further acts, instruments, and agreements and provide such further assurances
as the one party may reasonably require to consummate the transaction
contemplated hereunder as long as such performance, execution or delivery is
reasonably acceptable to the other party.
Section 9.19 Arbitration.
(a) If a claim (whether based on contract, statute, regulation,
or otherwise) between Seller and Buyer arising out of or
relating to this Contract (including, without limitation, the
construction, validity, interpretation, termination,
enforceability or
Page 40
alleged breach or threatened breach of the provisions
contained in this Contract) (defined for the purposes of this
SECTION 9.19 only, DISPUTE) cannot be resolved informally,
then the parties, if requested in writing by either party,
shall each appoint a corporate representative (with authority
to make decisions) to meet in a good faith effort to attempt
to resolve such Dispute. If such meeting is requested, the
meeting shall occur within 10 business days after the request
for such meeting. If the corporate representatives of the
parties are unable to resolve the Dispute within 20 days
after the meeting, the Dispute shall be resolved by binding
arbitration pursuant to SECTION 9.19(b).
(b) Any Dispute (including, without limitation, any dispute over
arbitrability or jurisdiction) not settled under SECTION
9.19(a) shall be, upon demand of a party to such Dispute,
resolved by arbitration held in Dallas, Texas, administered
by the AAA and, except as modified by this SECTION 9.19(b),
governed by the Commercial Arbitration Rules and Mediation
Procedures of the AAA (AAA RULES). The law applicable to the
arbitration process and procedure, including the
administration and enforcement thereof, shall be the Federal
Arbitration Act (9 U.S.C. Sections 1 et seq.), as amended.
The parties to the Dispute shall be entitled to engage in
reasonable discovery, including the right to production of
relevant documents by the opposing party or parties and the
right to take depositions reasonably limited in number, time
and place; provided that in no event shall any party to the
Dispute be entitled to refuse to produce relevant and
non-privileged documents or copies thereof requested by any
other party to the Dispute within the time limit set and to
the extent required by order of the arbitrator(s). The
arbitrator(s) shall determine the rights and obligations of
the parties to the Dispute according to the terms and
provisions of this Contract and the governing law specified
in SECTION 9.10 of this Contract to the extent not
inconsistent with the Federal Arbitration Act. The
arbitrator(s) shall hear and determine any preliminary issue
of law asserted by any party to the Dispute to be dispositive
of any claim or defense, in whole or in part, in the manner
that a court would hear and dispose of a motion to dismiss
for failure to state a claim or for summary judgment,
pursuant to such terms and procedures as the arbitrator(s)
deem appropriate. Any award by the arbitrator(s), whether
preliminary or final, shall be in writing, signed by each
arbitrator, and specify the reasons for the award, including
specific findings of fact and law. An arbitration award
rendered in any such proceeding shall be final, binding, and
non-appealable, and may be modified or vacated only on the
grounds provided by the Federal Arbitration Act. A judgment
on the arbitration award may be entered in any court having
competent jurisdiction. The arbitrators shall be divested of
any power to award damages in the nature of punitive,
exemplary, or consequential damages. With respect to a
Dispute or Disputes in which the aggregate amount of claims
or amounts in controversy do not exceed $100,000, a single
arbitrator will be impaneled, who will have authority to
render a maximum award of $100,000, including all damages of
any kind and costs, fees, interest, and the like. With
respect to a Dispute or Disputes in which the aggregate
amount of claims or amounts in controversy exceed $100,000,
the Dispute(s) will be decided by a majority vote of three
arbitrators.
(c) If a Dispute is required under SECTION 9.19(b) to be heard by
three arbitrators, the selection of such arbitrators shall be
as follows: each party to the Dispute shall each appoint one
arbitrator within 20 days after the filing of the
arbitration,
Page 41
and the two arbitrators so appointed shall select the
presiding arbitrator within 20 days after the latter of the
two arbitrators has been appointed by the parties. If either
of the parties fails to appoint its party-appointed
arbitrator or if the two party-appointed arbitrators cannot
reach agreement on the presiding arbitrator within the
applicable time period, then the AAA shall appoint the
remainder of the three arbitrators not yet appointed. Each
arbitrator shall be and remain at all times wholly impartial,
and, once appointed, no arbitrator shall have any ex parte
communications with any of the parties to the Dispute
concerning the arbitration or the underlying Dispute other
than communications directly concerning the selection of the
presiding arbitrator. If a Dispute is required under SECTION
9.19(b) to be heard by one arbitrator, the selection of the
arbitrator shall be in accordance with the AAA Rules then in
effect. All arbitrators shall be knowledgeable in the subject
matter of the Dispute.
Section 9.20 Exchange.
(a) Sellers may elect to consummate the sale of the Property as
part of a so-called like kind exchange (the EXCHANGE)
pursuant to Section 1031 of the Code.
(b) If Sellers so elect, the following provisions shall apply and
Buyer is obligated to cooperate with Sellers in effecting the
Exchange only if:
- the Closing Date is not delayed;
- Buyer incurs no additional liabilities of any kind
in effecting the Exchange;
- Buyer is not required to hold title to the exchange
property at any time; and
- Sellers shall pay all additional costs incurred by
Sellers and Buyer in effecting the Exchange,
including attorneys' fees.
Section 9.21 Related Property.
Buyer has entered into a Contract of Sale (the PARTNERSHIP SALE CONTRACT) with
JPI-CG MEZZ LLC, JPI-MC MEZZ LLC, JPI GENPAR REALTY, LLC, AND JPI INVESTMENT
COMPANY, L.P. concerning Buyer's acquisition of certain partnership, limited
liability company and limited partnership interests in the respective entities
and a Contract of Sale (the CASH CONTRACT) with JEFFERSON COMMONS - LAWRENCE,
L.P., and JEFFERSON COMMONS - WABASH, L.P. concerning Buyer's acquisition of
real property therein described. If the Partnership Sale Contract or the Cash
Contract is terminated, either Seller or Buyer may terminate this Contract by
written notice delivered to the other within 10 days after termination of the
respective contract. Additionally, if Buyer fails to deposit the Xxxxxxx Money
hereunder or under the Partnership Sale Contract or the Cash Contract as
required herein or therein, Sellers may terminate this Contract, and both the
Partnership Sale Contract and the Cash Contract by written notice delivered to
Buyer within 3 days after Buyer's failure to timely deliver such Xxxxxxx Money.
If this Contract is terminated under this Section, the Closing Agent shall
deliver the Xxxxxxx Money as provided in this Contract as though the reason for
such termination under the Partnership Sale Contract and the Cash Contract also
occurred under this Contract, and the parties thereafter have no further
rights, liabilities, or obligations under this Contract, the Partnership Sale
Contract or the Cash Contract except for matters which expressly survive
Page 42
termination of either this Contract, the Partnership Sale Contract or the Cash
Contract. Seller's rights under this Section survive termination of this
Contract. The intent of the parties is that this Contract, the Partnership
Sales Contract and the Cash Contract be cross defaulted.
Section 9.22 Confidentiality.
Seller acknowledges that the matters relating to the REIT, the Public Offering,
this Contract, and this transaction (collectively, the INFORMATION) are
confidential in nature. Therefore, Seller and, if applicable, each Designated
Owner, covenants and agrees to keep the Information confidential and will not
(except as required by applicable law, regulation or legal process including
applicable securities laws), without the Buyer's prior written consent,
disclose any Information in any manner whatsoever; provided, however, (a) that
the Information may be revealed only to the Seller's directors, officers,
employees, legal counsel, consultants, and advisors and to the Existing Lenders
(collectively, the INFORMATION GROUP), in each case on a "need to know" basis,
each of whom shall be informed of the confidential nature of the Information,
and (b) this confidentiality agreement is not intended to limit Seller's
continued use of its books, records, documents and other materials necessary
for the continued conduct of Seller's daily business and that of the respective
Properties. If the Seller or any member of the Information Group is requested
pursuant to, or required by, applicable law, regulation or legal process to
disclose any of the Information, the applicable member of the Information Group
will notify the Buyer promptly so that it may seek a protective order or other
appropriate remedy or, in its sole discretion, waive compliance with the terms
of this SECTION 9.22. In the event that no such protective order or other
remedy is obtained, or that the Buyer waives compliance with the terms of this
SECTION 9.22, the applicable member of the Information Group may furnish only
that portion of the Information which it is advised by counsel is legally
required and will exercise all reasonable efforts to obtain reliable assurance
that confidential treatment will be accorded the Information. Seller
acknowledges that remedies at law may be inadequate to protect the Buyer or the
REIT against any actual or threatened breach of this SECTION 9.22, and, without
prejudice to any other rights and remedies otherwise available, Seller agrees
to the granting of injunctive relief in favor of the REIT and/or the Buyer.
Notwithstanding any other express or implied agreement to the contrary, the
parties agree and acknowledge that each of them and each of their employees,
representatives, and other agents may disclose to any and all persons, without
limitation of any kind, the tax treatment and tax structure of the transaction
and all materials of any kind (including opinions or other tax analyses) that
are provided to any of them relating to such tax treatment and tax structure,
except to the extent that confidentiality is reasonably necessary to comply
with U.S. federal or state securities laws. For purposes of this paragraph, the
terms TAX TREATMENT and TAX STRUCTURE have the meanings specified in Treasury
Regulation section 1.6011-4(c). Buyer agrees that if the transaction
contemplated by this Contract is not consummated for any reason, then Buyer
will (i) return to Seller all documents and information obtained from Seller
promptly upon request and (ii) keep the Information confidential and will not
(except as required by applicable law, regulation or legal process including
applicable securities laws), without the Seller's prior written consent,
disclose any Information, the content or results of Buyer's investigations and
the information contained in the materials delivered by Seller to Buyer, in any
manner whatsoever or use the information gathered by Buyer or sent by Seller to
Buyer in a manner which will (a) harm or tend to harm Seller, or (b) provide
Buyer with an advantage in dealing with third parties in competition with
Seller or any Seller Affiliate.
[Signature Page follows]
Page 43
EXECUTED by Seller on September 22, 2004, to be effective the 17th day of
September, 2004.
SELLER
JEFFERSON COMMON - TUCSON PHASE II LIMITED
PARTNERSHIP, a Delaware limited partnership
By: JC - Tucson LLC, a Delaware limited
liability company, its general
partner
By: /s/ Xxxxx X. Xxxxxx, Xx.
----------------------------------
Name: Xxxxx X. Xxxxxx, Xx.
--------------------------------
Title: Assistant Vice President
-------------------------------
JEFFERSON COMMONS - COLUMBIA, L.P., a
Delaware limited partnership
By: JC - Columbia LLC, a Delaware limited
liability company, its general
partner
By: /s/ Xxxxx X. Xxxxxx, Xx.
----------------------------------
Name: Xxxxx X. Xxxxxx, Xx.
--------------------------------
Title: Assistant Vice President
-------------------------------
EXECUTED by Buyer on September 21, 2004, to be effective the 17th day of
September, 2004.
BUYER
EDUCATION REALTY OPERATING PARTNERSHIP, LP,
a Delaware limited partnership
By: Education Realty OP GP, Inc.,
Its General Partner
By: /s/ Xxxx X. Xxxxx
----------------------------------
Name: Xxxx X. Xxxxx
-----------------------------
Title: President
----------------------------
Buyer's Tax ID No.
-------------------------
The undersigned executes this Contract
solely for the purpose of the
representations and warranties to Buyer
regarding securities law matters set forth
in SECTION 4.1(OO), the confidentiality
covenants to Buyer set forth in SECTION
9.22, and the confidentiality provisions
set forth in SECTION 1.2(c)
JPI MULTIFAMILY INVESTMENTS L.P., a
Delaware limited partnership
By: New GP LLC, a Delaware limited
liability company, its General
Partner
By: /s/ Xxxxx X. Xxxxxx, Xx.
----------------------------------
Name: Xxxxx X. Xxxxxx, Xx.
--------------------------------
Title: Assistant Vice President
-------------------------------
JPI Investment Company, L.P., a Texas
limited partnership
By: JPI Multifamily Investments L.P., a
Delaware limited partnership, general
partner
By: New GP LLC, a Delaware limited
liability company, general
partner
By: /s/ Xxxxx X. Xxxxxx, Xx.
----------------------------------
Name: Xxxxx X. Xxxxxx, Xx.
--------------------------------
Title: Assistant Vice President
-------------------------------
The undersigned agrees to hold and disburse the Xxxxxxx Money in accordance
with this Contract.
CHICAGO TITLE COMPANY
By:
---------------------------------------
Name:
--------------------------------
Title:
-------------------------------
Date:
-------------------------------
EXHIBIT A-1
LEGAL DESCRIPTION OF REAL PROPERTY
LOCATED IN PIMA COUNTY, ARIZONA
EXHIBIT A-2
LEGAL DESCRIPTION OF REAL PROPERTY
LOCATED IN XXXXX COUNTY, MISSOURI
EXHIBIT B
SERVICE CONTRACTS
EXHIBIT C
PERSONAL PROPERTY
EXHIBIT D
INTENTIONALLY OMITTED
EXHIBIT E
PRO RATA CASH ALLOCATION
EXHIBIT F
REPORTS
EXHIBIT G
LIST OF DELIVERED LOAN DOCUMENTS
EXHIBIT H
LIST OF DELIVERED SURVEYS
1
EXHIBIT I
OTHER CONTRACTS FOR DEVELOPMENT
EXHIBIT J
DEED RESTRICTIONS
EXHIBIT K
LITIGATION
EXHIBIT L
NOTICES FROM GOVERNMENTAL AUTHORITIES
EXHIBIT M
BUYER'S PARTNERSHIP AGREEMENT
EXHIBIT N
KNOWLEDGE INDIVIDUALS
EXHIBIT O
AGREEMENT REGARDING CONTRIBUTED PROPERTIES
EXHIBIT P
LIQUIDITY LOAN DOCUMENTS
EXHIBIT Q
DEED
EXHIBIT R
XXXX OF SALE
EXHIBIT S
ASSIGNMENT OF LEASES, CONTRACTS,
SECURITY DEPOSITS AND WARRANTIES
EXHIBIT T
IRC SECTION 1445 CERTIFICATION
EXHIBIT U
TENANT NOTICE LETTER
EXHIBIT V
NON-EXCLUSIVE SERVICE XXXX LICENSE AGREEMENT
EXHIBIT W
LEGAL OPINION
