Exhibit 10.2
AGREEMENT FOR PURCHASE AND SALE
AND JOINT ESCROW INSTRUCTIONS
PONTE VEDRA BEACH VILLAGE PHASE II
This Agreement for Purchase and Sale and Joint Escrow Instructions (this
"Agreement") is entered into as of January 26, 1999, by and between ConAm Realty
Investors 3, L.P., a California limited partnership ("Seller"), and DOC
Investors, LLC, a Delaware limited liability company ("Buyer"), who agree and,
to the extent applicable, instruct First American Title Insurance Company
("Escrow Holder" or "Title Company," as the context may require), as escrow
holder, as follows:
1. This Agreement is made with reference to the following facts:
1.1. Seller owns that certain real property located at 000 Xxxxx
Xxxxx Xxxx, Xxxxx Xxxxx Xxxxx, Xxxxxxx 00000, commonly known as Ponte
Vedra Beach Village Phase II Apartments and more fully described on
EXHIBIT A attached hereto (the "Real Property"), including without
limitation all rights, members, easements, alleys, ways, appurtenances,
shrubbery, trees, plants and privileges located thereon or appertaining
thereto, together with any and all right, title and interest in and to
any land lying in the bed or right-of-way of any street, road, alley or
avenue, open or proposed, in front of or adjoining the land to the
centerline thereof, together with any nonexclusive right to use any and
all such land lying within any such roadbed, right-of-way, street, alley
or avenue for ingress and egress to and from the land, together with any
and all right, title and interest in and to any award made or to be made
in lieu thereof, and in and to any unpaid award for damage to the land by
reason of change of grade of any street. Along with the Real Property,
Buyer intends to purchase from Seller, and Seller intends to sell to
Buyer, in accordance with this Agreement, all improvements constructed
in, on or under the Real Property including a 000-xxxx xxxxxxxxxxx
xxxxxxxxx xxxxxxx (xxxxxxxxxxxx, the "Improvements"), all of Seller's
tangible personal property located on and used solely in connection with
the Real Property or the Improvements, including without limitation the
tangible personal property identified on EXHIBIT B attached hereto (the
"Personal Property") and all intangible personal property owned by Seller
and now, or hereafter, used in connection with the Real Property (the
"Intangible Property") including, without limitation, all (i) trade
names, (ii) logos, (iii) warranties and guaranties relating to the
construction, operation, maintenance, repair and use of the Improvements
and the Personal Property, including, without limitation, any and all
equipment, HVAC systems, plumbing and roof warranties and all
contractors' and subcontractors' warranties (the "Warranties"),
(iv) certificates of occupancy (or the local equivalents), permits,
licenses, approvals and authorizations issued by any federal, state or
municipal government, branch, authority, district, agency, court,
tribunal, department, board, commission or other instrumentality
("Governmental Authority"), (v) leases and other occupancy agreements
(the "Leases"), and (vi) contracts or other similar arrangements for
goods and services (the "Service Contracts").
1.2. By this Agreement, Buyer and Seller intend to
provide for the sale of the Real Property, the Improvements, the Personal
Property and the Intangible Property (collectively, the "Property") by
Seller to Buyer.
2. PURCHASE AND SALE. Subject to the terms and conditions of this
Agreement, Seller agrees to sell the Property to Buyer and Buyer agrees to
purchase the Property from Seller.
3. ESCROW.
3.1. OPENING OF ESCROW. Buyer shall immediately cause
an escrow (the "Escrow") to be opened at Escrow Holder's office
located at 000 Xxxx Xxxxx Xxxxxx, Xxxxx Xxx, Xxxxxxxxxx 00000,
Attention: Xxxx Xxxx-Xxxxxxxx for the purpose of facilitating the
consummation of this Agreement, by delivering the Deposit (as defined
in Section 4.1 below) to Escrow Holder along with a copy of the fully
executed original (or executed counterparts) of this Agreement within
two (2) business days after executing this Agreement. Escrow Holder
shall, immediately upon its receipt of the Deposit and executed
Agreement, execute and deliver to Buyer and Seller the Consent and
Acceptance of Escrow Holder attached to this Agreement, which Consent
and Acceptance of Escrow Holder shall specify the date of such receipt
(the "Escrow Opening Date"). This Agreement constitutes instructions
to Escrow Holder. Buyer and Seller shall execute such additional
mutual instructions as Escrow Holder may reasonably require, provided
that such additional instructions shall be consistent with this
Agreement. Any inconsistency between any such additional instructions
and this Agreement shall be resolved in a manner consistent with this
Agreement, and the provisions of this Agreement shall prevail unless
Buyer and Seller waive such inconsistent provision in writing by
specifically referring to the fact of such inconsistency and their
intent to waive it.
3.2. CLOSING DATE. The purchase and sale transaction
contemplated hereunder shall close in accordance with Article 8 below
(the "Closing") by 10:00 a.m. PST on the later of (i) the satisfaction of
the Concurrent Closing Contingency (as defined in Section 36 below) and
(ii) the tenth (10th) business day following the receipt of Seller's
Consent (as defined in Section 22 below) (the "Closing Date"); provided,
however, that if the Closing shall occur on the Closing Date but after
10:00 a.m. PST, the Closing Date shall be deemed to have occurred on the
date of recordation of the Deed (hereinafter defined) for purposes of
calculating prorations under Article 10 below, and provided further that
Buyer shall have the right, exercisable on written notice given to Seller
not less than five (5) days prior to the date originally scheduled as the
Closing Date, to extend such Closing Date for up to thirty (30) days to
accommodate the requirements of Buyer's lender and provided further that
in no event shall the Closing Date occur after February 1, 1999, unless
the parties otherwise agree in writing. If the Closing does not occur on
or before the Closing Date, then Buyer or Seller, if not in default under
this Agreement, may at any time thereafter give written notice to Escrow
Holder to cancel the Escrow whereupon the Escrow and the subject
transaction shall become terminated and Escrow Holder shall distribute
all monies and documents in Escrow Holder's possession in accordance with
this Agreement and all additional mutual
-2-
instructions as the parties may provide. Such cancellation of the
Escrow shall not prejudice or limit any legal or equitable rights of
Buyer or Seller, except as may be limited by Article 12 below.
4. PURCHASE PRICE. The purchase price payable by Buyer for the
Property (the "Purchase Price") at the Closing is Five Million Eight Hundred
Thousand and No/100 Dollars ($5,800,000.00), payable as follows:
4.1. DEPOSIT. Within three (3) business days after
Buyer's delivery of an executed copy of this Agreement to Escrow Holder,
Buyer shall deliver to Escrow Holder immediately available funds in the
amount of One Hundred Thousand and No/100 Dollars ($100,00.00) (the
"Deposit"). Escrow Holder shall promptly deposit the Deposit into a
federally-insured interest-bearing account for the benefit of Buyer upon
Escrow Holder's receipt of Buyer's United States taxpayer identification
number. The Deposit, plus any interest accrued thereon, shall be
applicable towards the Purchase Price except as otherwise provided in
Section 12 below.
4.2. BALANCE. Not later than one (1) business day prior
to the Closing Date, Buyer shall deposit with Escrow Holder cash or other
immediately available funds in the amount of the balance of the Purchase
Price, plus all other sums required of Buyer under this Agreement to pay
Buyer's costs and Buyer's share of prorations.
5. CONDITIONS PRECEDENT. Buyer's obligations under this Agreement
are subject to satisfaction or Buyer's written waiver of the following
conditions precedent (collectively, "Buyer's Conditions") on or before the
expiration of the applicable contingency period provided for below
(collectively, the "Contingency Periods"). If the respective Buyer's Condition
has not been satisfied or waived in writing, then at Buyer's option, this
Agreement and the Escrow shall be deemed terminated and neither Buyer nor Seller
shall have any further obligation to the other party under this Agreement
(except to the extent of any indemnities under this Agreement with respect to
events occurring before such termination, which indemnities shall survive any
such termination). If either party terminates the Escrow in accordance with the
preceding sentence, Escrow Holder shall, without requiring any further
instructions, immediately return the Deposit plus any interest accrued thereon
to Buyer.
5.1. DUE DILIGENCE DELIVERIES BY SELLER. Buyer
acknowledges that Seller prior to the date of this Agreement has provided
to Buyer copies of, or access to, the items identified on EXHIBIT C
attached hereto and that such items are the only items that Buyer has
requested from Seller for Buyer's examination and review of the Property
and all aspects thereof.
5.2. DUE DILIGENCE INVESTIGATION. Buyer acknowledges
that it has investigated, reviewed and approved (or has had an adequate
opportunity to investigate and review and accordingly approves) the
physical, developmental and economic status and feasibility of the
Property, including without limitation marketing studies, land use and
legal due
-3-
diligence, engineering studies, soils tests, physical inspections and
environmental surveys with respect to the Property. In order to
facilitate Buyer's investigation and analysis, Seller has granted and
will continue to grant to Buyer the right to enter the Property at any
time during normal business hours upon forty-eight (48) hours' prior
written notice to Seller, to conduct such inspections, reviews,
examinations and tests on the Property as Buyer has deemed necessary
or desirable to investigate the physical condition of the Property, as
well as access to relevant information relating to the Property within
Seller's possession or under Seller's control (but Seller has made and
now makes no representation or warranty regarding the accuracy or
completeness of such information). Buyer further acknowledges that it
is acquiring the Property in its "as-is" condition in accordance with
Section 19 below.
5.3. SELLER'S CONSENT. Seller shall have obtained
Seller's Consent in accordance with Article 22 below.
5.4. STATUS OF TITLE AND SURVEY. If Buyer intends to
obtain extended coverage title insurance in connection with this
Agreement, then Buyer shall obtain at its sole cost and expense an
as-built survey of the Property complying with 1992 ALTA/ACSM minimum
standards (the "Survey"). Buyer acknowledges that Buyer has approved
the exceptions to title shown in that certain preliminary title report
or owner's title commitment for the Property issued by the Title
Company (the "Title Report") and matters shown on the Survey (if any)
other than those exceptions or matters identified on EXHIBIT D
attached hereto ("Disapproved Title Exceptions"), which Disapproved
Title Exceptions Seller shall remove (or cause to be removed) as
exceptions to title prior to the Closing. Buyer shall have the
continuing right to update the Title Report and the Survey from time
to time and to give Seller notice of any additional Disapproved Title
Exceptions first arising after the date of the Title Report or the
Survey, as the case may be. Within ten (10) business days following
receipt of any written notice of such additional Disapproved Title
Exceptions from Buyer, Seller shall notify Buyer in writing of which
of such additional Disapproved Title Exceptions Seller will agree to
cure on or before the Closing Date; provided, however, that Seller
shall satisfy and correct, at or before the Closing, any Disapproved
Title Exceptions constituting a mortgage, deed of trust or other lien
encumbering all or any portion of the Property (other than liens
created by Buyer's acts or omissions) or otherwise created by Seller's
acts or omissions on or after the date of this Agreement ("Mandatory
Cure Items"). In the event Seller elects not to satisfy or cure any
such additional Disapproved Title Exceptions of which it is so
notified, then, within ten (10) business days following receipt of
Seller's election, Buyer shall by written notice to Seller elect one
of the following:
5.4.1. To waive such additional Disapproved Title
Exceptions and to close the transaction contemplated hereby in
accordance with the terms of this Agreement; provided, however,
that with respect to any Disapproved Title Exception which is a
Mandatory Cure Item, Buyer shall be entitled to satisfy or remove
any such Disapproved Title Exception(s) at the Closing and to
credit
-4-
against the Purchase Price the amount required to satisfy
or remove such Mandatory Cure Item(s); or
5.4.2. To terminate this Agreement, in which event Buyer
shall be entitled to the immediate return of the Deposit and the
parties hereto shall have no further rights, duties or obligations
under this Agreement, except those rights, duties and obligations
that, by the express terms hereof, survive termination of this
Agreement.
5.5. OWNER'S POLICY. On or before the Closing, the Title
Company must be prepared to issue to Buyer an Owner's Policy of Title
Insurance for the Property (the "Title Policy") effective as of the
Closing, insuring Buyer in the amount of the Purchase Price that title to
the Property is vested in Buyer at the Closing, subject only to (a)
standard pre-printed exceptions (other than those preprinted exceptions
that can be removed with a customary seller's affidavit), (b) liens for
taxes and assessments not yet delinquent, (c) those exceptions to title
described in the corresponding Title Report other than the Disapproved
Title Exceptions and (d) exceptions created or suffered by Buyer. Buyer
may require a policy without a generic survey exception only if Buyer can
timely provide Title Company with all information necessary in order for
the policy to be issued on or before the Closing Date. Seller shall not
suffer any liability in connection with its failure to remove any title
exception; Buyer's sole remedy for Seller's failure to cause the
elimination of a Disapproved Title Exception shall be termination of this
Agreement. Notwithstanding the foregoing, Seller shall cause the removal
of any Mandatory Cure Item at or before the Closing.
5.6. SELLER'S FINANCIAL CONDITION. Seller has not
(i) made an assignment for the benefit of creditors, (ii) filed a
petition in bankruptcy, (iii) been adjudicated insolvent or bankrupt,
(iv) petitioned a court for the appointment of any receiver of or trustee
for it or any substantial part of its property, (v) commenced any
proceeding relating to Seller under any reorganization, arrangement,
readjustment of debt, dissolution or liquidation law or statute of any
jurisdiction, whether now or hereafter in effect. There shall not have
been commenced and be pending against Seller any proceeding of the
nature described in the first sentence of this Section 5.6. No order for
relief shall have been entered with respect to Seller under the Federal
Bankruptcy Code.
5.7. COVENANTS, REPRESENTATIONS AND WARRANTIES. Seller
shall have complied, and at Closing shall then be in compliance, with
each and all of its covenants contained in this Agreement in all material
respects, and the representations and warranties set forth in Paragraph 7
hereof shall be true, complete and accurate as of the Closing Date in all
material respects.
5.8. SELLER'S DELIVERIES. Seller shall have delivered to
Buyer, in form and substance in accordance with the requirements herein,
all instruments and documents
-5-
required on Seller's part to effectuate this Agreement and the
transactions contemplated hereby.
Except for the Buyer's Condition referenced in Section 5.3 above, which is a
condition to Buyer's and Seller's obligations under this Agreement, any one or
more of the foregoing Buyer's Conditions may be waived by Buyer on or before the
Closing Date.
6. BUYER'S DELIVERIES. Provided that all other conditions to Buyer's
obligation to consummate the Closing shall have been or shall concurrently be
satisfied, Buyer shall deliver to Seller through Escrow Holder, on or before the
Closing Date, for disbursement, delivery and recordation, as provided in this
Agreement, the following funds, instruments and documents, the delivery of which
is material to the consummation of the subject transaction:
6.1. FUNDS. Immediately available funds in the amount
required of Buyer under this Agreement including sufficient funds to
meet Buyer's obligations under Sections 4.2, 9 and 10.
6.2. AUTHORITY. Evidence in form and substance
reasonably satisfactory to Seller and its legal counsel that Buyer is
authorized to enter into and consummate the transactions contemplated by
this Agreement.
6.3. ASSIGNMENT OF OCCUPANCY AGREEMENTS AND SERVICE
CONTRACTS. An executed counterpart of the Assignment referenced in
Section 7.5 below.
6.4. CLOSING STATEMENT. The Closing Statement
summarizing the prorations and other financial aspects of the
transaction.
6.5. OTHER DOCUMENTS. Any documents reasonably required
of Buyer by Title Company or Escrow Holder in order to consummate the
subject transaction.
7. SELLER'S DELIVERIES. Provided that all other conditions to
Seller's obligation to consummate the Closing shall have been or shall
concurrently be satisfied, Seller shall deliver to Buyer through Escrow Holder
on or before the Closing, for disbursement, delivery and recordation, as
provided in this Agreement, the following instruments and documents, the
delivery of which is material to the Closing:
7.1. LIMITED WARRANTY DEED. A limited warranty deed (the
"Deed") in substantially the form set forth as EXHIBIT E attached hereto,
conveying to Buyer good and marketable fee simple title to the Real
Estate, together with all rights, members, easements and appurtenances
thereto, expressly subject to the title exceptions approved by Buyer as
provided in Section 5.4 above. In addition, Seller shall deliver an
executed Real Estate Transfer Tax Declaration or local equivalent.
-6-
7.2. RELEASE OF EXISTING INDEBTEDNESS. Seller shall
cause the Property to be released from all mortgages, deeds of trust,
deeds to secure debt, security agreements, filings and statements and
other security interests relating to any existing indebtedness that is
secured in whole or in part by the Property.
7.3. SELLER'S AFFIDAVIT. A Seller's Affidavit in the
form set forth as EXHIBIT F attached hereto and made a part hereof.
7.4. BLANKET XXXX OF SALE AND TRANSFER. A blanket xxxx
of sale, transfer and assignment agreement (the "Xxxx of Sale") in
substantially the form set forth as EXHIBIT G attached hereto, assigning
to Buyer all of Seller's right, title and interest in and to any and all
Personal Property.
7.5. ASSIGNMENT OF LEASES AND SERVICE CONTRACTS. An
assignment and assumption of Leases and Service Contracts and other
Intangible Property (the "Assignment") in substantially the form set
forth as EXHIBIT H attached hereto, assigning to Buyer all of Seller's
right, title and interest in and to the Leases and Service Contracts
(that Buyer shall have elected or elects to assume) and other Intangible
Property with a cross-indemnity between Seller and Buyer, with Seller
indemnifying Buyer with respect to any liability arising under the Leases
and Service Contracts for the period up to, but not including, the
Closing Date, and Buyer indemnifying Seller with respect to any liability
arising under the Leases and Service Contracts arising on and after the
Closing Date, respectively, and with an express assumption by Buyer of
Seller's obligations under the Leases and Service Contracts arising on
and after the Closing Date.
7.6. CERTIFIED RENT ROLL. Seller shall deliver to Buyer
a certificate, in substantially the form of EXHIBIT I attached hereto,
pursuant to which Seller shall certify to Buyer a then current Rent Roll
for the Property.
7.7. SELLER'S CERTIFICATE. A certificate addressed to
Buyer stating that the representations and warranties set forth in
Section 14 are true and correct as of the Closing in all material
respects or stating any exceptions thereto.
7.8. CERTIFICATE OF NON-FOREIGN STATUS. A certificate
addressed to Buyer made in compliance with Paragraph 1445 of the Internal
Revenue Code that Seller is not a foreign person and not subject to
withholding requirements.
7.9. CLOSING STATEMENT. The Closing Statement
summarizing the prorations and other financial aspects of the transaction
contemplated by this Agreement.
7.10. LEASES AND SERVICE CONTRACTS. The original Leases,
Service Contracts, Warranties, certificate(s) of occupancy, permits and
licenses.
-7-
7.11. AUTHORITY. Evidence in form and substance
reasonably satisfactory to Buyer and its legal counsel that Seller is
authorized to enter into and consummate the transactions contemplated by
this Agreement.
7.12. KEYS. Seller shall deliver to Buyer all of the keys
in Seller's possession to any door or lock in or on the Property.
7.13. TENANT FILES. The current tenant files, including
all correspondence, notices, financial information, sales reports and
other information.
7.14. MATERIALS. All materials pertaining to the
operation and maintenance of the Property.
7.15. OTHER DOCUMENTS. All other documents reasonably
required of Seller by Escrow Holder in order to consummate the subject
transaction.
8. CLOSING ESCROW. On the Closing Date, provided that Escrow Holder
shall have received all of the documents, instruments and funds required to be
delivered by Buyer and Seller in accordance with Articles 6 and 7 above (other
than those documents and other items specified in Sections 7.10, 7.12, 7.13 and
7.14 above, which shall be deemed delivered concurrently with delivery of
possession of the Property to Buyer), and provided that Title Company is
prepared to issue the Title Policy upon the Closing and that all other
conditions to the Closing have been satisfied (or waived by the party to this
Agreement which benefits from such condition), Escrow Holder shall promptly
perform all of the following:
8.1. RECORDING. Cause the Deed to be recorded with the
real property records of the county in which the Property is located.
8.2. BUYER'S DELIVERIES. Deliver to Seller all of the
items pursuant to Section 6 above.
8.3. SELLER'S DELIVERIES. Deliver to Buyer the Xxxx of
Sale, the Assignment and all of the other items pursuant to Article 7
except as otherwise provided above.
8.4. COSTS AND PRORATIONS. Pay the costs and apply the
prorations in accordance with Articles 9 and 10 below.
8.5. ISSUANCE OF TITLE POLICY. Cause the Title Policy to
be issued and delivered to Buyer.
8.6. DISBURSEMENT OF PURCHASE PRICE. Disburse to Seller,
or in accordance with Seller's instructions (after making appropriate
adjustments for costs and prorations as provided in this Agreement), all
funds deposited with Escrow Holder by Buyer in payment of the Purchase
Price.
-8-
9. COSTS. Seller shall pay (a) one-half (1/2) of Escrow Holder's
fee, (b) any documentary transfer and stamp taxes payable in connection with the
recordation of the Deed and (c) Escrow Holder's customary charges to a seller
for document drafting, recording and miscellaneous charges. Buyer shall pay (i)
one-half (1/2) of Escrow Holder's fee, (ii) the premiums and other costs for the
Title Policy, including without limitation any endorsements relating thereto,
(iii) Escrow Holder's customary charges to a buyer for document drafting,
recording and miscellaneous charges, and (iv) all costs associated with Buyer's
financing of any or all of the Purchase Price, including without limitation any
applicable intangible taxes, documentary stamps and recording costs and any fees
for any loan, appraisal, title insurance policy or other service.
10. PRORATIONS. The following shall be prorated between Buyer and
Seller as of 11:59 p.m. local time of the day immediately preceding the Closing
Date, on the basis of the actual number of days elapsed during the month in
which the Closing occurs: general and special county and city real property
taxes and special assessments (collectively, "Taxes") for the tax period then in
effect and insurance premiums (but only if Buyer is assuming Seller's insurance
policy or policies). Proration of Taxes shall be based on the most recent
official tax bills or notice of valuation available for the fiscal year in which
the Closing occurs, with due allowance to be made for the maximum available
discount or other exemptions to the extent permissible for said year, and to the
extent the tax bills do not accurately reflect the actual Taxes assessed against
the Property (or any portion of the Property) and allocable either to the period
before the Closing or to the period after the Closing, then Buyer and Seller
shall adjust the actual Taxes between Buyer and Seller, outside of Escrow, as
soon as reasonably possible following the Closing. In addition to the foregoing
apportionments, Seller shall receive all rents and other income accrued, and
shall pay all other expenses accrued or incurred, in connection with the
ownership or operation of Property before the Closing Date, and Buyer shall
receive all rents and other income accruing, and shall pay all other expenses
accrued or incurred, in connection with the ownership or operation of Property
on or after the Closing Date, all of which rents, other income and expenses
shall be prorated as of the Closing. Rents and other income, if any, collected
by Buyer after the Closing shall be applied first to any amounts due to Buyer
and then, to the extent such rents or other income relate to the period ending
on or before the Closing, such rents or other income shall be paid to Seller
within ten (10) days after end of the month in which such amounts were
collected. Buyer shall incur no obligation to Seller for Buyer's failure to
collect such rentals or other income. All security and any other refundable
deposits paid by tenants to Seller pursuant to tenant leases shall be delivered
by certified funds to Buyer at the Closing or, at Seller's option, credited to
Buyer against the cash portion of the Purchase Price at the Closing. Escrow
Holder shall not be concerned with any prorations that are to be made after the
Closing pursuant to this Agreement.
11. FAILURE OF ESCROW TO CLOSE. If Escrow fails to close by reason of
a failure of a Buyer's Condition in accordance with Article 5 above, or because
of a default by Seller under this Agreement, Buyer shall be entitled to the
immediate return of the Deposit upon delivery of written notice by Buyer to
Escrow Holder. If this Agreement or Escrow is terminated, Buyer shall return to
Seller, within two (2) business days after the termination of Escrow, all
documents
-9-
and materials provided by Seller or its agents to Buyer or its agents
in connection with this Agreement or the Property and all copies thereof.
12. LIQUIDATED DAMAGES. THE PARTIES HAVE DISCUSSED AND NEGOTIATED IN
GOOD FAITH THE QUESTION OF THE DAMAGES THAT WOULD BE SUFFERED BY SELLER IF THE
CLOSING DOES NOT OCCUR BECAUSE BUYER BREACHES THIS AGREEMENT AND HAVE ENDEAVORED
TO REASONABLY ESTIMATE SUCH DAMAGES. THEY AGREE THAT (I) SUCH DAMAGES ARE AND
WILL BE IMPRACTICABLE OR EXTREMELY DIFFICULT TO FIX, (II) LIQUIDATED DAMAGES IN
THE AMOUNT OF THE DEPOSIT (AS IT MAY BE INCREASED FROM TIME TO TIME) ARE AND
WOULD BE REASONABLE AS A MEASURE OF SUCH DAMAGES, (III) IN THE EVENT OF SUCH
BREACH, SELLER SHALL BE ENTITLED TO RETAIN THE DEPOSIT AS SUCH LIQUIDATED
DAMAGES, AND (IV) IN CONSIDERATION OF THE PAYMENT OF SUCH LIQUIDATED DAMAGES,
SELLER SHALL BE DEEMED TO HAVE WAIVED ALL OTHER CLAIMS FOR DAMAGES OR RELIEF AT
LAW OR IN EQUITY ON ACCOUNT OF THE FAILURE OF THE CLOSING TO OCCUR, EXCEPT FOR:
(A) CLAIMS FOR THE RETURN OR OTHER DELIVERY OF DOCUMENTS IN CONNECTION WITH THIS
AGREEMENT; (B) ACTIONS TO EXPUNGE A LIS PENDENS OR OTHER CLOUDS ON TITLE CAUSED
BY BUYER; (C) CLAIMS ON ACCOUNT OF BUYER'S INDEMNITY OBLIGATIONS UNDER THIS
AGREEMENT, AND (D) ATTORNEYS' FEES AND COSTS INCURRED BY SELLER INCIDENT TO
CLAUSES (A) THROUGH (C). NOTWITHSTANDING THE FOREGOING, IN THE EVENT BUYER
OBJECTS TO, FAILS TO COOPERATE WITH OR OTHERWISE OPPOSES SELLER'S WITHDRAWAL OF
THE DEPOSIT OUT OF THE ESCROW, SELLER SHALL HAVE ALL OF THE REMEDIES OTHERWISE
AVAILABLE TO SELLER AT LAW OR IN EQUITY.
SELLER'S INITIALS BUYER'S INITIALS
__________ __________
13. POSSESSION. Seller shall deliver possession of the Property to
Buyer on the Closing Date, subject to the rights of tenants.
14. SELLER'S REPRESENTATIONS AND WARRANTIES. Seller represents and
warrants to and covenants with Buyer that the following representations and
warranties are complete and accurate as of the date of this Agreement and will
be complete and accurate as of the Closing Date:
14.1. AUTHORITY. Seller is a limited partnership, duly
organized, validly existing and in good standing under the laws of the
State of California, qualified to do business in good standing under the
laws of the State in which the Property is located, and Seller has full
right, power and authority to enter into this Agreement and to perform
all of the obligations and liabilities of Seller hereunder. This
Agreement has been duly and validly authorized, executed and delivered by
and on behalf of Seller and, assuming the due
-10-
authorization, execution and delivery thereof by and on behalf of
Buyer, constitutes a valid and binding obligation of Seller
enforceable in accordance with its terms, subject to the effects of
bankruptcy, insolvency, reorganization, receivership and other similar
laws affecting the rights and remedies of creditors generally and to
general equitable principles (whether considered in a proceeding at
law or in equity). Neither the execution nor delivery of this
Agreement or any other documents executed and delivered, or to be
executed and delivered, by Seller in connection with the transactions
described herein will violate any provision of Seller's organizational
documents or of any agreements, regulations or laws to which Seller is
bound.
14.2. NO OTHER AGREEMENTS. To Seller's actual knowledge,
other than this Agreement, the Leases, the Service Contracts and the
matters identified on EXHIBIT J attached hereto, there are no leases,
service contracts, management agreements or other agreements or
instruments in force or effect that (a) grant to any person or entity any
right, title, interest or benefit in or to all or any part of the
Property or (b) any rights relating to the use, maintenance, operation,
construction or management of all or any part of the Property.
14.3. NO LITIGATION. Except as set forth in EXHIBIT K
attached hereto, Seller has no actual knowledge, nor has Seller received
any notice, of any pending litigation or proceeding brought by any person
or entity or Governmental Authority against Seller with respect to the
Property.
14.4. POSSESSION. To Seller's actual knowledge, except
for the tenants in possession of the Property under the Leases, as shown
in the Rent Roll, there are no parties in possession of or claiming any
possession to any portion of the Property as lessees, tenants at
sufferance, licensees, easement holders, trespassers or otherwise.
14.5. NO ASSESSMENTS. Seller has received no notice of
any (a) assessments against the Property that are unpaid, whether or not
they have become liens, except ad valorem taxes for the current year, or
(b) any change in the assessed value or basis for levy of taxes regarding
the Property.
14.6. NOTICE OF CONDEMNATION; RIGHT OF WAY MATTERS.
Seller has received no notice of any threatened or contemplated action by
any Governmental Authority having the power of eminent domain, which
might result in any part of the Property being taken by condemnation or
conveyed in lieu thereof. Seller shall, promptly upon receiving any such
notice, give Buyer written notice thereof.
14.7. VIOLATION OF LAWS. Seller has received no notice
that any Governmental Authority has determined that there are any
violations of zoning, health, environmental, or other statutes,
ordinances, or regulations affecting the Property. In the event Seller
receives notice of any such violations prior to Closing affecting the
Property, Seller shall promptly notify Buyer thereof.
-11-
14.8. NO BANKRUPTCY. Seller is not a party to any
voluntary or involuntary proceedings in bankruptcy, reorganization or
similar proceedings under the federal bankruptcy laws or under any state
laws relating to the protection of debtors, or subject to any general
assignment for the benefit of creditors, and to Seller's actual
knowledge, no such action has been threatened.
14.9. ZONING. Seller shall, promptly upon receiving any
notice of any contemplated or threatened rezoning of the Property, give
Buyer written notice thereof.
14.10. SERVICE CONTRACTS. Attached hereto as EXHIBIT L and
incorporated herein is a complete and accurate list of all of the Service
Contracts and as of the date of this Agreement Seller has delivered to
Buyer complete and accurate copies of all such Service Contracts. Seller
has received no notice of any default, or claim of default, on the part
of any party to any of such Service Contracts, and within five (5)
business days following mutual execution of this Agreement, Buyer shall
notify Seller of any Service Contract that Buyer wishes to assume and
Seller, at its sole cost and expense, shall terminate all other Service
Contracts within five (5) days prior to Closing in accordance with (but
only to the extent permitted under) the governing terms of the applicable
Service Contract.
14.11. LEASES. The copies of the Leases delivered or made
available by Seller to Buyer in accordance with Section 7.10 above are
complete and accurate, and there are no amendments or modifications
thereto not disclosed on the rent roll delivered in accordance with
Section 7.6 above or otherwise in writing by Seller to Buyer. Seller
hereby covenants and agrees with Buyer that, so long as this Agreement
remains in full force and effect, Seller will continue to operate and
manage the Property in substantially the same manner as it has been
operated and managed in the past.
14.12. AVAILABILITY OF AGREEMENTS. Seller shall make
available to Buyer for review at Seller's offices at the Property during
normal business hours, and upon reasonable advance notice, full, true,
correct and complete copies of all Service Contracts, Leases and all
written amendments, modifications, agreements, or understandings relating
thereto as are in effect from time to time while this Agreement remains
in effect.
14.13. EMPLOYEE LIABILITY. To Seller's actual knowledge,
after the Closing Buyer shall not be obligated to continue the employment
of any of the employees of Seller or Seller's property manager. To
Seller's actual knowledge, all of the employees for the Property are
employees of Seller's property manager and not of Seller.
14.14. HAZARDOUS MATERIALS. To Seller's actual knowledge,
Seller has not generated, disposed of, released or found any Hazardous
Materials (hereinafter defined) on the Property, and Seller has no actual
knowledge of the existence of any areas for the generation, storage or
disposal of any Hazardous Materials on the Property. Seller has received
no notice that any Governmental Authority has determined that there are
any
-12-
violations of Environmental Laws (as hereinafter defined)
affecting the Property. In the event Seller receives notice of any
such Hazardous Materials on the Property or any such violation
affecting the Property prior to the Closing, Seller immediately shall
notify Buyer thereof. "Hazardous Materials" means petroleum, including
crude oil or any fraction thereof, asbestos, radon gas,
polychlorinated biphenyls, and any other substance identified as
hazardous in the following, as the same may have been amended: the
Comprehensive Environmental Response, Compensation and Liability Act
of 1980, 42 U.S.C. Section 9601, ET SEQ.; the Resource Conservation
Act of 1976, 42 U.S.C. Section 6921, ET SEQ.; the Toxic Substances
Control Act, 15 U.S.C. Section 2601, ET SEQ.; the Federal
Insecticide, Fungicide and Rodenticide Act, 7 U.S.C. Section 136; the
Federal Water Pollution Control Act, 33 U.S.C. Section 1251, ET SEQ.;
the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801,
ET SEQ.; the Federal Solid Waste Disposal Act, 42 U.S.C. Section
6901, ET SEQ.; the Clean Air Act, 42 U.S.C. Section 7401, ET SEQ.;
and any other legislation or ordinance of any Governmental Authority
identified by its terms as pertaining to hazardous materials, waste or
asbestos ("Environmental Laws").
14.15. AGREEMENTS AFFECTING THE PROPERTY. Subject to the
provisions in Section 14.11 hereof, Seller hereby covenants and agrees
with Buyer that, so long as this Agreement remains in full force and
effect, Seller will not sell, assign, convey (absolutely or as security),
grant a security interest in, or otherwise encumber or dispose of, the
Property (or any interest or estate therein) without the prior written
consent of the Buyer. Seller has not executed and will execute no
exclusive or other brokerage agreements which will survive the Closing
Date. Seller shall not enter into Service Contracts from and after the
date of this Agreement without the prior written consent of Buyer, which
consent may be granted or withheld in Buyer's sole and absolute
discretion; provided, however, that Seller hereby covenants and agrees
with Buyer that, so long as this Agreement remains in full force and
effect, Seller will continue to operate and manage the Property in
substantially the same manner as it has been operated and managed in the
past.
14.16. MAINTENANCE OF INSURANCE. Seller shall maintain in
full force and effect all existing policies of insurance relating to the
Property through and including the Closing Date, shall pay all premiums
with respect to such insurance on or before the due date therefor and
shall not knowingly take any action which would cause such insurance not
to remain in full force and effect or fail knowingly to take any action
required to maintain such insurance in full force and effect.
14.17. FIXTURES. All fixtures and articles of Personal
Property included in and which are part of the sale are now, and at the
Closing will be, owned by Seller free and clear of any conditional bills
of sale, chattel mortgages, security agreements or financing statements,
or other liens of security interest created by Seller, and shall be
transferred to Buyer as a part of the transaction.
14.18. SECURITY DEPOSITS. Security deposits shown in the
certified rent roll are a full, true and complete list of all of the
security deposits for the Property and are now held
-13-
by Seller and Seller's property manager under the terms of the Leases,
and none have been forfeited by any existing tenant.
14.19. NON-FOREIGN STATUS. Seller is not a "foreign
person" as that term is defined in the Internal Revenue Code of 1986, as
amended, and the regulations promulgated pursuant thereto, and Buyer has
no obligation under the Internal Revenue Code Section 1445 to withhold
and pay over to the Internal Revenue Service any part of the "amount
realized" by Seller in the transaction contemplated hereby (as such term
is defined in the regulations issued under Internal Revenue Code Section
1445).
14.20. REPRESENTATIONS, WARRANTIES AND COVENANTS RE-MADE AT
CLOSING. The foregoing warranties and representations are true, and the
foregoing covenants are in full force and effect and binding on Seller as
of the date hereof and shall be in full force and effect and deemed to
have been automatically reaffirmed and restated by Seller as of the
Closing Date.
For purposes of this Section 14, "Seller's actual knowledge" shall mean the
knowledge of (i) J. Xxxxxxx Xxxxxxxxx, (ii) Xxxxx Xxxxxx and (iii) Xxxxxxx
Xxxxxxx without any duty of investigation or inquiry and "notice" shall mean
written notice. The representations and warranties of Seller shall survive the
Closing for six (6) months, and any claim made by Buyer against Seller with
respect thereto must be asserted within such six-month period.
15. BUYER'S REPRESENTATIONS AND WARRANTIES. The accuracy and
completeness of the following constitute a condition to the Closing, and Buyer
represents and warrants to Seller that the following is complete and accurate as
of the date of this Agreement and shall be complete and accurate as of the
Closing, and shall survive the Closing: Buyer is duly organized and validly
existing and is (or will at the Closing be) qualified to conduct its business
and has the legal power, right and authority to enter into this Agreement and to
consummate the transactions contemplated by this Agreement. All requisite
action (corporate, partnership, trust or otherwise) has been taken by Buyer in
connection with entering into this Agreement and the consummation of the
transactions contemplated by this Agreement. The individual executing this
Agreement on behalf of Buyer has the legal power, right and actual authority to
bind Buyer to the terms and conditions of this Agreement. This Agreement and
all documents required by this Agreement to be executed by Buyer are and are
valid, legally binding obligations of and enforceable against Buyer in
accordance with their terms. The foregoing warranties and representations are
true, and the foregoing covenants are in full force and effect and binding on
Buyer as of the date hereof and shall be in full force and effect and deemed to
have been automatically reaffirmed and restated by Buyer as of the Closing Date.
16. CONDEMNATION. If all or any material portion of the Property is
taken by eminent domain (or is the subject of a pending or contemplated taking
which has not been consummated) before the Closing, then (a) Seller, if Seller
has actual knowledge thereof, shall notify Buyer of such fact and (b) Buyer
shall have the option to terminate this Agreement upon written notice to Escrow
Holder and Seller given no later than thirty (30) business days after Seller has
given such
-14-
notice. For purposes of the foregoing sentence, a portion of the Property
shall not be deemed material unless the taking thereof diminishes the
rentable area of the building or the recreation facilities or restricts
access to the Property. If this Agreement is so terminated, then (i) Buyer
shall pay all costs associated with the cancellation of the Escrow pursuant
to this Section, (ii) neither Buyer nor Seller shall have any further rights
or obligations under this Agreement (except to the extent of any indemnities
under this Agreement with respect to events occurring before such
termination, which indemnities shall survive any such termination), and (iii)
Escrow Holder shall, without requiring any further instruction from Seller,
immediately return to Buyer the Deposit and all interest accrued thereon. If
Buyer does not terminate this Agreement within such thirty-day period, then
(A) Buyer shall not thereafter have the right to terminate this Agreement by
reason of such taking and (B) Buyer and Seller shall proceed to the Closing
in accordance with this Agreement, without modification of the terms of this
Agreement, except that (1) the Property will not include the property so
taken, (2) the Purchase Price will be reduced by the amount of any awards for
such taking awarded to Seller as of the Closing Date, and (3) Seller shall
assign and turn over to Buyer, and Buyer shall be entitled to receive and
retain, all awards for such taking not yet awarded as of the Closing.
17. DESTRUCTION. If the Property or any portion thereof is damaged
by fire or other casualty on or before the Closing Date, Seller immediately
shall notify Buyer of such damage. If the estimated cost to repair the damage
is less than the greater of (i) $400,000 and (ii) five percent (5%) of the
Purchase Price and does not eliminate or materially impair access to the
Property, Buyer and Seller shall proceed to the Closing in accordance with the
terms of this Agreement, without modification of the terms of this Agreement, in
which event Buyer shall be entitled to an assignment of the proceeds of all
insurance relating to such fire or other casualty. If the estimated cost to
repair the damage equals or exceeds the greater of (i) $400,000 and (ii) five
percent (5%) of the Purchase Price, Buyer may elect either (a) to terminate this
Agreement and receive the return of the Deposit (minus any escrow or title
cancellation fees), in which case neither party shall have any additional rights
or obligations under this Agreement, or (b) to proceed to the Closing in
accordance with this Agreement, without modification of the terms of this
Agreement, in which event Buyer shall be entitled to an assignment of the
proceeds of all insurance relating to such fire or other casualty, if any. Such
election shall be made by Buyer within thirty (30) business days following
Seller's notification to Buyer. Buyer's failure to elect to terminate this
Agreement within such thirty-day period shall conclusively be deemed an election
to proceed to the Closing.
18. BROKERS. Each party to this Agreement represents and warrants to
the other that no real estate or business broker, agent, finder, or other person
is responsible for bringing about or negotiating this Agreement and that such
party has not dealt with any real estate broker, agent, finder or person
relative to this Agreement in any manner. Each party to this Agreement shall
defend, indemnify, and hold harmless the other party to this Agreement against
all liabilities, damages, losses, costs, expenses, attorneys' fees and claims
arising from (a) any breach of such representation by such indemnifying party
set forth in the preceding sentence, and (b) any claims that may be made against
such indemnified party by any real estate broker, agent, finder or other person
alleging to have acted on behalf of or to have dealt with such indemnifying
party.
-15-
19. NO RELIANCE - AS-IS. EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN
THIS AGREEMENT OR IN ANY OF THE DOCUMENTS TO BE DELIVERED PURSUANT HERETO, BUYER
ACKNOWLEDGES THAT IT IS PURCHASING THE PROPERTY IN RELIANCE SOLELY ON:
(I) BUYER'S INSPECTION OF THE REAL PROPERTY, THE PERSONAL PROPERTY AND THE
IMPROVEMENTS; (II) BUYER'S INDEPENDENT VERIFICATION OF THE TRUTH OF ANY
STATEMENTS CONTAINED IN THE DOCUMENTS MADE AVAILABLE TO BUYER; AND (III) THE
OPINIONS AND ADVICE OF CONSULTANTS AND ATTORNEYS ENGAGED BY BUYER CONCERNING THE
PROPERTY. BUYER FURTHER ACKNOWLEDGES THAT BEFORE ITS EXECUTION OF THIS
AGREEMENT BUYER SHALL HAVE PERFORMED OR WILL HAVE HAD AN OPPORTUNITY TO PERFORM
ALL OF ITS DUE DILIGENCE INVESTIGATIONS OF AND WITH RESPECT TO THE PROPERTY AS
BUYER DEEMS APPROPRIATE, INCLUDING ENGINEERING STUDIES, SOILS TESTS,
ENVIRONMENTAL SURVEYS AND TESTING, PHYSICAL INSPECTIONS, ALTA OR OTHER SURVEYS
AND MARKET ANALYSES AS WELL AS BUYER'S EVALUATION OF THE CONDITION AND STATUS OF
THE PERSONAL PROPERTY AND IMPROVEMENTS AND THE OPERATION AND FUTURE PROSPECTS OF
THE PROPERTY. EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT OR IN
ANY OF THE DOCUMENTS TO BE DELIVERED PURSUANT HERETO, AT THE CLOSING, BUYER
ACCEPTS THE PROPERTY AND ALL MATTERS RELATING TO THE PROPERTY IN THEIR "AS IS,"
"WHERE-IS" AND "WITH ALL FAULTS" CONDITION OR STATUS AS OF THE CLOSING DATE,
INCLUDING SUCH MATTERS AS: SOILS AND GEOLOGICAL CONDITION, TOPOGRAPHY, AREA AND
CONFIGURATION OF THE REAL PROPERTY; THE AGE AND CONDITION OF THE IMPROVEMENTS
AND PERSONAL PROPERTY; THE EXISTENCE OF ANY HAZARDOUS OR TOXIC SUBSTANCES OR
MATERIALS, CONSTRUCTION DEFECTS OR OTHER MATTERS WHICH WOULD OR COULD
NECESSITATE ABATEMENT OR REMEDIATION ACTION BY THE PROPERTY'S OWNER; ANY
PHYSICAL OR MECHANICAL DEFECTS IN THE IMPROVEMENTS OR PERSONAL PROPERTY; ANY
EASEMENT, LICENSE OR ENCROACHMENT WHICH IS NOT A MATTER OF PUBLIC RECORD,
WHETHER OR NOT VISIBLE UPON INSPECTION OF THE PROPERTY; THE ZONING AND OTHER
LAND USE REGULATIONS APPLICABLE TO THE PROPERTY; AND ANY OTHER MATTER RELATING
TO THE PROPERTY INCLUDING, BUT NOT LIMITED TO, VALUE, TITLE, INCOME,
FEASIBILITY, COST, MARKETING AND INVESTMENT RETURN. BUYER ACKNOWLEDGES AND
AGREES THAT SELLER IS NOT MAKING ANY EXPRESS OR IMPLIED WARRANTIES OR
REPRESENTATIONS OF ANY KIND OR CHARACTER WITH RESPECT TO THE PROPERTY. IN
PARTICULAR BUT NOT BY WAY OF LIMITATION OF THE FOREGOING, EXCEPT AS EXPRESSLY
SET FORTH IN THIS AGREEMENT OR IN ANY OF THE DOCUMENTS TO BE DELIVERED PURSUANT
HERETO, SELLER MAKES NO WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, RELATING
TO COMPLIANCE OF THE IMPROVEMENTS WITH CURRENT BUILDING CODES, INCLUDING WITHOUT
LIMITATION THOSE RELATING TO UPDATED OR REVISED STANDARDS FOR PLUMBING,
ELECTRICAL, STRUCTURAL OR SEISMIC MATTERS. BUYER WARRANTS AND REPRESENTS TO
SELLER THAT BUYER HAS NOT RELIED ON AND WILL NOT RELY ON, EITHER DIRECTLY OR
INDIRECTLY, ANY WARRANTY OR REPRESENTATION OF SELLER NOT EXPLICITLY SET FORTH IN
THIS AGREEMENT.
20. INDEMNITY REGARDING INSPECTION. In consideration of Seller's
permission to Buyer and its agents to perform investigations and testing on and
about the Property prior to the Closing, Buyer shall defend, indemnify and hold
harmless Seller and Seller's partners, and their respective
-16-
officers, employees, agents, contractors, successors, assigns, and affiliates
(collectively, the "Indemnitees"), and the Property from all claims, costs,
liens, actions and judgments (including attorneys' fees and other defense
costs actually incurred by Seller) resulting from Buyer's investigation of
the Property or its attempts to obtain any regulatory approvals in connection
with the Property, or otherwise caused by Buyer or any of its employees,
agents or independent contractors, except for the non-negligent release of
Hazardous Materials already on the Property occasioned thereby. Unless and
until the Closing occurs, Buyer shall maintain all the information which it
obtains in connection with the Property in strict confidence and shall not
reveal any of such information to any party other than those parties to which
it may otherwise be required to disclose in accordance with applicable law.
Buyer shall, at Buyer's sole cost, promptly repair any damage resulting from
its activities on the Property and restore the Property to substantially the
same condition as before Buyer or any of its agents first entered the
Property. If the Closing does not occur on or before the Closing Date for
any reason other than a breach of this Agreement by Seller, Buyer shall
provide Seller, at Seller's cost, copies of all third-party engineering and
environmental reports and materials derived from Buyer's investigation of the
Property, concurrently with reimbursement by Seller of Buyer's out-of-pocket
costs in procuring such reports and materials.
21. BUYER'S REMEDIES. In the event the transaction contemplated
hereby is not consummated as a result of Seller's default hereunder, Buyer's
sole and exclusive remedies shall be either (i) to seek from Escrow Holder the
return of the Deposit and any other documents and funds then held by Escrow
Holder and Seller shall reimburse Buyer for Buyer's reasonable and documented
out-of-pocket expenses incurred in connection with the purchase transaction
contemplated under this Agreement (but in no event to exceed one-fourth percent
(1/4%) of Purchase Price)or (ii) to seek specific performance of Seller's
obligations hereunder by delivering the Purchase Price into the Escrow;
provided, however, that as conditions precedent to such action for specific
performance, [A] no uncured default in the performance of Buyer's obligations
under this Agreement shall exist and no event shall have occurred which with the
passage of time or with notice, or both, could become such an event of default,
and [B] Buyer shall not seek to amend the Purchase Price in such action.
22. SELLER'S PARTNERS' APPROVAL. Notwithstanding anything to the
contrary contained in this Agreement, the Closing shall not occur unless and
until Seller shall have obtained written approval ("Seller's Consent") from
those partners of Seller (or those partners of the partners of Seller, as the
case may be) whose approval is legally required before Seller may sell the
Property to Buyer hereunder. Seller shall seek such approval immediately after
the Escrow Opening Date. If Seller's Consent is not obtained within twenty-one
(21) days after the Escrow Opening Date (as such period may be extended by
Seller at Seller's sole option for up to an additional forty (40) days), Seller
or Buyer may terminate this Agreement by written notice delivered to the other
before Seller's Consent is obtained, in which case Buyer shall be entitled to
the return of the Deposit and neither Buyer nor Seller shall have any further
rights or obligations under this Agreement (except to the extent of any
indemnities under this Agreement with respect to events occurring before such
termination, which indemnities shall survive any such termination and
-17-
except that Seller shall reimburse Buyer for Buyer's reasonable and
documented out-of-pocket engineering and environmental expenses (but in no
event to exceed $3,600)).
23. FURTHER ASSURANCES. Each party to this Agreement shall execute
and deliver all instruments and documents and take all actions as may be
reasonably required or appropriate to carry out the purposes of this Agreement.
24. COUNTERPARTS AND EXHIBITS. This Agreement may be executed in
counterparts, each of which is deemed an original and all of which together
constitute one document. All exhibits attached to and referenced in this
Agreement are incorporated into this Agreement.
25. TIME OF ESSENCE. Time and strict and punctual performance are of
the essence with respect to each provision of this Agreement.
26. ATTORNEY'S FEES. The prevailing party in any litigation,
arbitration, mediation, bankruptcy, insolvency or other proceeding
("Proceeding") relating to the enforcement or interpretation of this Agreement
may recover from the unsuccessful party all costs, expenses and actual
attorney's fees (including expert witness and other consultants' fees and costs)
relating to or arising out of (a) the Proceeding (whether or not the Proceeding
proceeds to judgment), and (b) any post-judgment or post-award proceeding
including, without limitation, one to enforce or collect any judgment or award
resulting from the Proceeding. All such judgments and awards shall contain a
specific provision for the recovery of all such subsequently incurred costs,
expenses and actual attorney's fees.
27. GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the state in which the Property is located. Each
party hereby authorizes and accepts service of process sufficient for personal
jurisdiction in any action against it as contemplated by this paragraph by
registered or certified mail, return receipt requested, postage prepaid, to its
address for the giving of notices set forth in this Agreement.
28. MODIFICATION. This Agreement may be modified only by a writing
executed by the party to this Agreement against whom enforcement of the
modification is sought.
29. PRIOR UNDERSTANDINGS. This Agreement and all documents
specifically referred to and executed in connection with this Agreement: (a)
contain the entire and final agreement of the parties to this Agreement with
respect to the subject matter of this Agreement, and (b) supersede all
negotiations, stipulations, understandings, agreements, representations and
warranties, if any, with respect to such subject matter, which precede or
accompany the execution of this Agreement.
30. INTERPRETATION. Whenever the context so requires in this
Agreement, all words used in the singular may include the plural (and vice
versa) and the word "person" includes a natural person, a corporation, a firm, a
partnership, a joint venture, a trust, an estate or any other entity. The terms
"includes" and "including" do not imply any limitation. Unless "business day"
is
-18-
specified, the term "day" means a calendar day. The term "business day"
means any day other than a Saturday, Sunday or Federal or other holiday in
the State in which the Property is located. If the last day for any act
falls on a day other than a business day, the time for performance shall be
extended to the next business day. No remedy or election under this
Agreement is exclusive, but rather, to the extent permitted by applicable
law, each such remedy and election is cumulative with all other remedies at
law or in equity. The paragraph headings in this Agreement (a) are included
only for convenience, (b) do not in any manner modify or limit any of the
provisions of this Agreement and (c) may not be used in the interpretation of
this Agreement. Each provision of this Agreement is valid and enforceable to
the fullest extent permitted by law. If any provision of this Agreement (or
the application of such provision to any person or circumstance) is or
becomes invalid or unenforceable, the remainder of this Agreement, and the
application of such provision to persons or circumstances other than those as
to which it is held invalid or unenforceable, shall not be affected by such
invalidity or unenforceability.
31. SUCCESSORS-IN-INTEREST AND ASSIGNS. Buyer may not assign its
rights under this Agreement to any person or entity without the prior written
consent of Seller, which consent may be withheld in Seller's sole and absolute
discretion; provided, however, that Buyer may assign such rights to a subsidiary
wholly-owned by Buyer upon written notice given to Seller not less than five (5)
business days prior to the Closing. No assignment by Buyer of any of its rights
or obligations under this Agreement shall relieve Buyer of any of its
obligations under this Agreement unless Seller expressly agrees to such release
in writing. Subject to the foregoing, this Agreement shall be binding on and
shall inure to the benefit of the successors-in-interest and assigns of each
party to this Agreement.
32. NOTICES. Each notice and other communication required or
permitted to be given under this Agreement ("Notice") must be in writing.
Notice is duly given to another party upon: (a) hand delivery to the other
party, (b) receipt by the other party when sent by facsimile to the address
and number for such party set forth below (provided, however, that the Notice
is not effective unless a duplicate copy of the facsimile Notice is promptly
given by one of the other methods permitted under this paragraph), (c) three
business days after the Notice has been deposited with the United States
postal service as first class certified mail, return receipt requested,
postage prepaid, and addressed to the party as set forth below, or (d) the
next business day after the Notice has been deposited with a reputable
overnight delivery service, postage prepaid, addressed to the party as set
forth below with next-business-day delivery guaranteed, provided that the
sending party receives a confirmation of delivery from the
delivery-service-provider.
-19-
If to Seller:
ConAm Realty Investors 3, L.P.
c/o Continental American Properties, Ltd.
0000 Xxx Xxxxx Xxxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000-0000
Attention: Xxxxx Xxxxxx, Esq.
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
With a copy to:
Xxxxxx Xxxxxxx & Xxxx LLP
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Attention: Xxxxxx X. Xxxxx, Esq.
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
If to Buyer:
DOC Investors, LLC
c/o Lend Lease Real Estate Investments, Inc.
0000 Xxxxxxxxx Xxxx, X.X., Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
With a copy to:
King & Spalding
000 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000-0000
Attention: Xxxxxxx Xxxxx, Esq.
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
-20-
If to Escrow Holder:
First American Title Insurance Company
000 Xxxx Xxxxx Xxxxxx
Xxxxx Xxx, Xxxxxxxxxx 00000
Attention: Xxxx Xxxx-Xxxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Each party shall make a reasonable, good faith effort to ensure that it will
accept or receive Notices to it that are given in accordance with this
paragraph. A party may change its address for purposes of this paragraph by
giving the other party(ies) written notice of a new address in the manner set
forth above.
33. WAIVER. Any waiver of a default or provision under this Agreement
must be in writing. No such waiver shall constitute a waiver of any other
default or provision concerning the same or any other provision of this
Agreement. No delay or omission by a party in the exercise of any of its rights
or remedies constitutes a waiver of (or otherwise impairs) such right or remedy.
A consent to or approval of an act does not waive or render unnecessary the
consent to or approval of any other or subsequent act.
34. DRAFTING AMBIGUITIES. Each party to this Agreement and its legal
counsel have reviewed and revised this Agreement. The rule of construction that
ambiguities are to be resolved against the drafting party or in favor of the
party receiving a particular benefit under an agreement shall not be employed in
the interpretation of this Agreement or any amendment to this Agreement.
35. THIRD PARTY BENEFICIARIES. Nothing in this Agreement is intended
to confer any rights or remedies on any person other than the parties to this
Agreement and their respective successors-in-interest and permitted assignees.
36. CONCURRENT CLOSING. Notwithstanding anything to the contrary
contained in this Agreement, the Closing shall be subject to and contingent
upon, and shall occur concurrently with, the Closing of the purchase
transactions for the following properties between Seller (or entities affiliated
with Seller) and Buyer (the "Concurrent Closing Contingency"): Autumn Heights,
Creekside Oaks, Lakeview Village, Las Colinas, Oaktree Village, Ponte Vedra
Beach Village I, Rancho Antigua, Shadowood Village, Skyline Village, Tierra
Catalina, Village at the Foothills I, Village at the Foothills II & III;
provided, however, that in the event this purchase transaction or any of the
other purchase transactions enumerated above is terminated as a result of (i)
condemnation or (ii) damage or destruction in accordance with the applicable
purchase agreement, such purchase transaction(s) shall not be taken into account
in determining whether the Concurrent Closing Contingency shall have been
satisfied (unless the aggregate number of purchase transactions so terminated is
two or more, in which event the Concurrent Closing Contingency shall be deemed
not to have been satisfied) and provided further that in the event of
-21-
(i) condemnation or (ii) damage or destruction with respect to Ponte Vedra
Beach Village Phase I (the "Companion Project") whereby the purchase
transaction for the Companion Project is terminated in accordance with the
applicable purchase agreement, this purchase transaction shall also be
terminated but this purchase transaction and the purchase transaction for the
Companion Project shall be deemed to be a single purchase transaction for
purposes of determining the aggregate number of purchase transactions so
terminated. In addition, in the event this purchase transaction or any of
the other purchase transactions enumerated above does not close as a result
of a default by Buyer in the performance of its obligations under this
Agreement or any other respective purchase agreement, Seller shall be
entitled (but not obligated) to exercise its rights under Section 12 above
and the corresponding provisions of each such purchase agreement even though
the Concurrent Closing Contingency shall not have been satisfied.
37. EXCLUSIVITY. So long as this Agreement is in effect, Seller
shall not solicit, negotiate, offer or accept an offer for the purchase of the
Property (or any interest therein) for sale or contract to sell the Property (or
any interest therein) to any party other than Buyer or negotiate, solicit or
entertain any offers to purchase or sell the Property (or any interest therein).
38. CONFIDENTIALITY. Buyer and Seller agree that all documents and
information concerning the Property delivered to Buyer, the subject matter of
this Agreement and all negotiations shall remain confidential, and neither party
shall disclose any terms of this Agreement without the prior approval of the
other party except as may be required by law. Buyer and Seller shall be
entitled to disclose such information only to those parties required to know it,
including without limitation employees of either of the parties, consultants,
attorneys and accountants engaged by either Buyer or Seller, and prospective or
existing investors and lenders. This Section 38 shall expire upon the earlier
of the termination of this Agreement and the Closing.
39. RADON DISCLOSURE. Seller is required pursuant to Section
404.056(8), Florida Statutes, to disclose the following: Radon is a
naturally occurring radioactive gas that, when it has accumulated in a
building in sufficient quantities, may present health risks to persons who
are exposed to it over time. Levels of radon that exceed federal and state
guidelines have been found in buildings in Florida. Additional information
regarding radon and radon testing may be obtained from your county public
health unit.
-22-
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first written above.
SELLER:
CONAM REALTY INVESTORS 3, L.P.,
a California limited partnership
By: ConAm Property Services IV, Ltd.,
a California limited partnership,
its general partner
By: Continental American Development, Inc.,
a California corporation, its general partner
By: /s/ Xxxxx Xxxxxx
-------------------------------
Its: Vice President
[Signatures Continued On Next Page]
-23-
BUYER:
DOC Investors, LLC,
a Delaware limited liability company
By: ConAm DOC Affiliates LLC,
a California limited liability company,
its administrative member
By: Continental American Properties, Ltd.,
a California limited partnership,
its managing member
By: DJE Financial Corp.,
a California corporation,
its general partner
By: /s/ J. Xxxxxxx Xxxxxxxxx
-------------------------------
Its Vice President
-24-
CONSENT AND ACCEPTANCE OF ESCROW HOLDER:
The undersigned acknowledges having received an executed original of this
Agreement (or counterparts thereof) and the Deposit on January 26, 1999, which
date is the "Escrow Opening Date" for purposes of this Agreement.
The undersigned hereby consents to and accepts the instructions set forth in the
above Agreement for Purchase and Sale and Joint Escrow Instructions.
First American Title Insurance Company
By: /s/ Xxxxxxx X. Xxxxx
-------------------------------
Its: Vice President
-25-
INDEX OF EXHIBITS
EXHIBIT SECTION
------- -------
Exhibit A - Legal Description Section 1.1
Exhibit B - Schedule of Personal Property Section 1.1
Exhibit C - Due Diligence Materials Delivered to Buyer Section 5.1
Exhibit D - Disapproved Title Exceptions Section 5.4
Exhibit E - Form of Deed Section 7.1
Exhibit F - Form of Seller's Affidavit Section 7.3
Exhibit G - Xxxx of Sale Section 7.4
Exhibit H - Form of Assignment Section 7.5
Exhibit I - Form of Certificate for Rent Roll Section 7.6
Exhibit J - Other Agreements and Instruments Section 14.2
Exhibit K - Pending Litigation or Other Proceedings Section 14.3
Exhibit L - Schedule of Service Contracts Section 14.10
