REAL ESTATE
PURCHASE AGREEMENT
SELLER: ACI Financing, L.L.C.
BUYER: SGD Investments, Inc.
October 15, 2002
TABLE OF CONTENTS
Page
ARTICLE I PROPERTY AND PURCHASE PRICE.......................................1
1.1 Property...............................................................1
A. Land................................................................1
B. Improvements........................................................1
C. Personal Property...................................................1
D. Tenant Leases.......................................................2
E. Plans and Studies...................................................2
F. Marketing Information...............................................2
1.2 A. Purchase Price......................................................2
▇. ▇▇▇▇▇▇▇ Money.................................................2
C. Wire of Purchase Price........................................2
D. Closing.......................................................3
1.3 A. Excluded Liabilities................................................3
1.3 A. Excluded Liabilities................................................3
1.4 Tax Deferred Exchange..................................................4
ARTICLE II TITLE, SURVEY AND INSPECTIONS.....................................4
2.1 A. Title...............................................................4
B. Survey..............................................................4
C. Title and Survey Objections; Cure...................................4
2.2 Buyer Inspection.......................................................5
A. Inspection Rights and Duties........................................5
B. Due Diligence Period................................................6
C. Seller Furnished Information........................................6
ARTICLE III SELLER'S REPRESENTATIONS..........................................9
3.1 Seller's Representations...............................................9
A. Violations..........................................................9
B. Special Assessments.................................................9
C. Ad Valorem Tax......................................................9
D. Litigation..........................................................9
E. Adverse Parties.....................................................9
F. Foreign Person......................................................9
G. Title...............................................................9
H. Right and Power.....................................................9
I. Liens..............................................................10
J. Hazardous Waste....................................................10
K. Service Contracts..................................................10
L. Personal Property..................................................11
M. Access.............................................................11
N. Copies.............................................................11
O. Circumstances......................................................11
P. Tenant Leases......................................................11
Q. Seller's Performance...............................................11
R. Closing Representations............................................11
3.2 Buyer's Representations...............................................12
Page
ARTICLE IV PRECLOSING AND CLOSING...........................................12
4.1 Operation of Subject Property.........................................12
4.2 Risk of Loss..........................................................12
4.3 Condemnation..........................................................13
4.4 Seller's Closing Obligations..........................................13
4.5 Buyer's Closing Obligations...........................................14
4.6 Conditions to Closing.................................................14
A. Buyer's Conditions.................................................14
B. Seller's Conditions................................................15
C. Effect of Closing..................................................15
4.7 Additional Instruments................................................16
4.8 General Warranty of Title.............................................16
4.9 Title Insurance.......................................................16
4.10 Taxes.................................................................16
4.11 Income and Expense Proration..........................................16
4.12 Closing Costs.........................................................17
A. Seller.............................................................17
B. Buyer..............................................................17
4.13 Possession............................................................17
4.14 Assumption of Operating Agreements....................................17
4.15 Remedies..............................................................17
A. Seller's Default...................................................17
B. Buyer's Default....................................................18
4.16 Wood-Destroying Insects...............................................18
4.17 Reimbursement of Expenses.............................................18
ARTICLE V MISCELLANEOUS PROVISIONS..........................................18
5.1 Mutual Indemnification................................................18
5.2 Environmental Indemnity...............................................19
5.3 Confidentiality.......................................................19
5.4 Assignment............................................................20
5.5 Governing Law.........................................................20
5.6 Parties...............................................................20
5.7 Entire Agreement......................................................20
5.8 Attorneys' Fees.......................................................20
5.9 Time..................................................................20
5.10 Brokers...............................................................20
5.11 No Merger.............................................................21
5.12 Notices...............................................................21
5.13 Holidays..............................................................21
5.14 Section Headings......................................................21
5.15 Counterparts..........................................................21
5.16 Interpretation........................................................21
5.17 Best Knowledge of Seller..............................................21
5.18 Facsimile Signatures and Initials.....................................22
5.19 Interest Earned on ▇▇▇▇▇▇▇ Money......................................22
5.20 Amendment.............................................................22
5.21 Pending Litigation....................................................22
SCHEDULES:
Schedule 1.1A Legal Description
Schedule 2.2B Estoppel Certificate
Schedule 3.1K Leases, Licenses and Service Contracts
Schedule 3.1P Tenant Leases
Schedule 4.4A Special Warranty Deed
Schedule 4.4D ▇▇▇▇ of Sale
Schedule 4.4E Assignment of Service Contracts, Warranties, Governmental
Approvals and Trade Names
Schedule 4.4F Assignment and Assumption of Tenant Leases
Schedule 4.4G Non-Foreign Affidavit for Entity Transfer
PURCHASE AGREEMENT
THIS PURCHASE AGREEMENT ("Agreement") is made and entered into this 15th
day of October, 2002, by and between SGD INVESTMENTS, INC., a Nebraska
corporation (the "Buyer"), and ACI FINANCING, L.L.C., a Nebraska limited
liability company (the "Seller").
WHEREAS, Seller is the owner of certain real estate and improvements
generally known as the ACI Office Building located at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇, ▇▇▇▇▇▇▇▇, as more particularly described below;
WHEREAS, Seller intends to sell to Buyer, and Buyer intends to purchase
from Seller, such property together with all improvements, tangible personal
property, leases, plans and specifications, marketing information, and
warranties, all on and subject to the terms and conditions hereinafter set
forth;
NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, Seller and Buyer hereby agree as follows:
ARTICLE I
PROPERTY AND PURCHASE PRICE
1.1 Property. Seller shall sell to Buyer, and Buyer shall purchase from
Seller, upon and subject to the terms and provisions hereof, the Subject
Property, as hereafter defined, and all and singular the rights, privileges,
advantages, and appurtenances belonging or in any way appertaining to the
Subject Property, including all right, title, and interest of Seller,
reversionary or otherwise to all easements upon the Subject Property and all
buildings, leasehold rights, roads, alleys, waters, wastewater capacity or
reservations, mineral, oil and gas rights (if any), streets, or rights-of-way
bounding the Subject Property (to the centerline thereof), and rights of ingress
and egress thereto, and all other interests in strips and gores owned by Seller,
if any, on or immediately abutting the Subject Property. A nonexclusive listing
of such Subject Property includes the following:
A. Land. That certain tract or parcel of land being more particularly
described on Schedule 1.1A attached hereto and made a part hereof for all
purposes, together with all water, wastewater capacity, or reservations,
mineral, oil and gas rights thereon and thereunder, and all rights of Seller in
and to any easements, rights of way, covenants and abutting roads or streets
related thereto (the "Land");
B. Improvements. Those certain improvements located on the tract of
land identified on Schedule 1.1A consisting of an approximately 70,000 square
foot, single story office building, which improvements shall be referred to
herein as the "Improvements";
C. Personal Property. Seller's interest in any and all personal
property currently located at the Improvements, including but not limited to all
signage, office equipment, tools, maintenance equipment, books, records,
manufacturers' warranties (including, without limitation, roof warranties)
furniture, furnishings, fittings, appliances, fixtures, plumbing, maintenance
supplies in reasonable quantities, heating and air conditioning systems affixed
to or situated upon or used in the operation of the Land and Improvements,
intangible personal
property relating to the Land and Improvements(including without limitation,
goodwill, telephone numbers and business name) other than the personal property
of any tenant or of any of Seller's independent contractors (the "Personal
Property");
D. Tenant Leases. Seller's interest in all leases with tenants (the
"Tenants") now or hereafter occupying space in the Improvements or otherwise
having rights with respect to the use of the Land or the Improvements (the
"Tenant Leases"), and in all security, advance rental, or other deposits
actually received by Seller under the Tenant Leases;
E. Plans and Studies. To the extent in existence, a copy of all site
plans, surveys, soil and substrata studies, architectural renderings, plans and
specifications, engineering plans and studies, environmental studies, floor
plans, landscape plans, and other plans, diagrams or studies of any kind, if
any, now in Seller's possession which relate to the Land, the Improvements or
the Personal Property; and
F. Marketing Information. All leasing brochures, market studies, and
other materials in Seller's possession relating to the operation of the
Improvements, provided that material which in Seller's reasonable opinion
constitutes a part of the Seller's continuing business operations or financial
records may be retained by Seller if Seller gives Buyer legible copies of same.
The Land, Improvements, Tenant Leases, Personal Property, Marketing
Information and other property described above shall be referred to collectively
as the "Subject Property."
1.2 A. Purchase Price. The total purchase price shall be the sum of
Seven Million Nine Hundred Seventy-five Thousand and No/100 Dollars
($7,975,000.00) (the "Purchase Price").
▇. ▇▇▇▇▇▇▇ Money. Buyer shall deposit in a separate interest bearing
account with Assured Quality Title Co., ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(the "Title Company"), as ▇▇▇▇▇▇▇ Money, the sum of One Hundred Thousand and
No/100 Dollars ($100,000.00) (the "▇▇▇▇▇▇▇ Money") concurrent with the execution
hereof.
The ▇▇▇▇▇▇▇ Money shall be placed in an insured interest-bearing
account by Title Company with all interest accruing thereon for the benefit of
Buyer. Upon consummation of this transaction, the ▇▇▇▇▇▇▇ Money, together with
all interest accruing thereon, shall either be credited against the purchase
price or returned to Buyer, at Buyer's election. In the event this Agreement is
terminated by the party granted such right of termination (for any reason
expressly provided hereunder) the ▇▇▇▇▇▇▇ Money shall be delivered to Buyer or
Seller, as provided herein, and any accrued interest on such ▇▇▇▇▇▇▇ Money shall
be delivered to the Buyer. Without limiting the generality of the foregoing, the
▇▇▇▇▇▇▇ Money shall be returned to Buyer in the event the transaction fails to
close due to non-satisfaction of any conditions to Buyer's obligation under
Section 4.6A.
C. Wire of Purchase Price. Buyer shall (unless the Agreement has been
previously terminated) wire transfer the balance of the cash portion of the
Purchase Price to the Title Company for the benefit of Seller as of the Closing.
Such cash portion of the Purchase Price shall be reduced in the amount of the
Secured Indebtedness assumed by Buyer.
D. Closing. The date that this Agreement is fully executed by all
parties and deposited with the Title Company shall constitute the "Effective
Date" of this Agreement. Closing shall take place at 10:00 a.m. on the tenth
(10th) day following the later of (i) Buyer's approval of the Subject Property
and expiration of the "Due Diligence Period" as defined below, (ii) satisfaction
of all conditions precedent, or (iii) written approval by Lender (as defined
below) for the assumption of the Secured Indebtedness, in the offices of the
Title Company or at such other location mutually agreeable to aforementioned
Seller and Buyer. In any event, if Closing shall not have occurred by December
5, 2002, then Seller or Buyer may immediately terminate this Agreement, provided
such party is not in default hereunder. Upon termination of this Agreement, the
▇▇▇▇▇▇▇ Money shall be returned to the party entitled thereto as set forth in
this Agreement, and the parties shall have no further duties or obligations
hereunder, except those duties and obligations that survive such termination as
expressly agreed herein. Without limiting the foregoing, in the event of
termination of this Agreement by Seller for failure to close by December 5,
2002, without default by Buyer, the ▇▇▇▇▇▇▇ Money, together with interest
thereon, shall be returned to Buyer.
1.3 A. Assumption of Secured Indebtedness. Subject to the conditions
specified in this Agreement, and as part of the Purchase Price consideration of
the sale and transfer of the Subject Property, Buyer will assume at the Closing
and pay, discharge and perform when due the following indebtedness secured by
the Subject Property:
(i) The secured loan in the original principal amount of Four
Million Three Hundred Thousand Dollars ($4,300,000.00) at an interest rate
of 8.63% per annum made by Principal Commercial Funding, LLC ("Lender") on
or about July 24, 2000, and maturing August 1, 2010, having a current
estimated principal balance due thereunder of $4,200,000 (the "Secured
Indebtedness").
B. Excluded Liabilities. Except for the Secured Indebtedness, and
contracts to be assumed pursuant to Section 4.14, Buyer will not assume, pay,
discharge or otherwise be liable for any liabilities, claims, debts, damages,
expenses and obligations, or portions thereof relating to the Subject Property
as exist on the Closing Date or arise out of or relate to the ownership,
operation or use of the Subject Property prior to Closing, whether known or
unknown, contingent, absolute, liquidated or unliquidated, disputed and
undisputed or otherwise, including without limitation any of the following
liabilities or obligations (herein referred to as "Excluded Liabilities"):
(i) Any of Seller's liabilities or obligations under this
Agreement contemplated hereby.
(ii) Any of Seller's liabilities or obligations for expenses or
fees incident to or arising out of the negotiation, preparation, approval
or authorization of this Agreement or the consummation (or preparation for
the consummation) of the transactions contemplated hereby, including
without limitation attorneys' and accountants' fees.
(iii) Except with respect to prorated real estate taxes as set
forth in Section 4.10, any federal, state, local or foreign taxes, charges,
fees, levies, special assessments, penalties or other assessments imposed
by any United States, local or foreign taxing authority or any agency
thereof, including any interest, penalties or
additions thereto that are attributable to any period prior to or including
the Closing Date related to the Subject Property, operations or assets of
Seller.
(iv) Any environmental liabilities (including without limitation
personal injury, property damages and liabilities relating to cleanup,
remediations or activities required by governmental regulators) related to
the ownership or operation of the Subject Property on or before the Closing
Date.
1.4 Tax Deferred Exchange. The parties acknowledge that Seller may desire
to effectuate a like-kind exchange pursuant to the provisions of Section 1031 of
the Internal Revenue Code of 1986, as amended (the "Code") with regard to the
Subject Property, which may require the use of a qualified intermediary or
escrow account. The parties agree to cooperate reasonably in connection
therewith, provided qualification for Section 1031 treatment shall be solely the
responsibility of Seller, and Buyer shall not be responsible for such
qualification, and provided further, that such like-kind exchange shall in no
event (i) have an adverse impact upon Buyer or the Subject Property, (ii) result
in any additional expense to Buyer, or (iii) cause a delay in the Closing.
Seller agrees to indemnify, defend and hold Buyer harmless from any expenses,
liabilities or claims arising from or related to such like-kind exchange,
including the actions or inactions of any intermediary or escrow agent utilized
in connection therewith.
ARTICLE II
TITLE, SURVEY AND INSPECTIONS
2.1 A. Title. Within ten (10) days from the Effective Date of this
Agreement, Seller shall furnish Buyer with a Commitment, through Assured Quality
Title Co., for an Owner's Title Insurance Policy for the Subject Property (the
"Commitment"), with the Commitment to be in the full amount of the Purchase
Price, together with legible copies of all instruments mentioned therein as
exceptions to good and indefeasible title. The Commitment shall provide for full
extended coverage over all exceptions (including deleting the area and boundary
survey exception, with Buyer solely responsible for the cost of deleting the
survey exceptions). The Commitment shall further provide a zoning endorsement,
or if such zoning endorsement shall not be available, Seller shall furnish
zoning letters regarding the Subject Property during the Due Diligence Period,
which zoning letters shall be in form and content reasonably acceptable to
Buyer. Buyer shall be entitled to obtain such other endorsements (at Buyer's
cost) as Buyer deems reasonably necessary. Buyer shall prior to the expiration
of the Due Diligence Period (provided the Commitment is furnished to Buyer in
accordance with the above time frame), notify Seller in writing of any matters
or exceptions to the title which are unacceptable to Buyer (the "Objection
Notice").
B. Survey. Within ten (10) days from the Effective Date hereof, Seller
agrees to obtain and furnish to Buyer any existing surveys of the Subject
Property ("Survey"). Buyer shall, prior to the expiration of the Due Diligence
Period (provided the Survey is furnished in accordance with the above time
frame) notify Seller in writing of any matters or exceptions (the "Survey
Exceptions") to the Survey which are unacceptable to Buyer.
C. Title and Survey Objections; Cure. If Buyer fails to notify Seller
in writing of any matters or exceptions, whether from the Commitment or the
Survey, which are unacceptable to Buyer prior to the expiration of the Due
Diligence Period (provided the Commitment and Survey are provided to Buyer
during the periods set forth above), such
exceptions shall be deemed accepted by Buyer and shall constitute permitted
exceptions (hereinafter collectively with the Secured Indebtedness, the
"Permitted Exceptions"), and Buyer's right to request Seller to cure such
exceptions shall be deemed waived by Buyer. If, however, any exceptions or
matters are unacceptable to Buyer (in Buyer's sole discretion) and Buyer
notifies Seller in writing of such fact prior to the expiration of the Due
Diligence Period, Seller shall exercise reasonable efforts to cure such matters
at least two (2) days prior to the scheduled Closing, or if necessary extend the
scheduled Closing for up to five (5) days to complete such cure. Notwithstanding
anything to the contrary contained in the Agreement, in no event shall any title
or survey exception, objection or other matter to which Buyer has provided a
notice constitute a Permitted Exception, unless cured to Buyer's satisfaction in
Buyer's sole and absolute discretion, or waived in writing by Buyer.
If Seller notifies Buyer in writing that Seller is unable to remove
such unacceptable exceptions, or if Seller fails or refuses to cure said
unacceptable exceptions within the time period provided, Buyer may, as Buyer's
sole and exclusive remedies, either (i) terminate this Agreement by giving
Seller written notice thereof, in which event the ▇▇▇▇▇▇▇ Money shall be
returned to Buyer, and neither party shall have any further rights, duties, or
obligations hereunder and this Agreement shall thereafter be null and void for
all purposes; or (ii) elect to purchase the Subject Property subject to such
unacceptable items or objections not so eliminated, modified, or cured, in which
event the Purchase Price shall not be reduced. Buyer shall make such election
upon the earlier of the time scheduled for Closing, or within two (2) business
days of receipt of Seller's written notice that it is unable to remove the
exceptions or that the exceptions cannot be removed or cured on commercially
reasonable terms. Buyer's failure to provide written notice of such election in
timely manner shall mean this Agreement shall be terminated in accordance with
the preceding Section 2.1C(i).
In no event shall the notices, actions to cure defects, or any other
provisions of this Section 2.1C alter or modify the provisions regarding due
diligence and the potential termination of this Agreement under Section 2.2B.
2.2 Buyer Inspection.
A. Inspection Rights and Duties. Pending Closing, Buyer, its
employees, agents, attorneys, accountants, appraisers, architects, real estate
advisors and engineers, may inspect the Subject Property during normal business
hours and conduct studies and tests thereon. Buyer shall not unreasonably
interfere with the tenant or Seller's business operations. All information
acquired by or supplied to Buyer in connection with the Subject Property or any
other operations of Seller shall be confidential and shall be disseminated only
to the foregoing list of Buyer's agents for the purpose contemplated herein.
Buyer hereby indemnifies and holds Seller harmless from and against any and all
liabilities actually incurred, including, without limitation, any damage or
injury to persons or property, resulting directly from studies, tests and/or
inspections of the Subject Property by Buyer and/or its agents, employees,
invitees and/or licensees and their agents, employees, invitees and/or licensees
and any mechanics' or other liens, losses, costs, expenses or claims that may be
filed or asserted against the Subject Property or Seller by such parties in
relation to such inspection (which indemnification shall survive termination of
this Agreement). However, in no event shall Buyer be liable for any
environmental cleanup, remediation or other liability or obligation which arises
with respect to any pollutants, contaminants or regulated substances which may
be in, on, under or about the Property. Seller shall provide to Buyer, and its
agents and representatives, immediate access to the Subject Property, and shall
instruct its personnel to fully cooperate with and assist Buyer.
B. Due Diligence Period. Buyer shall have a period commencing
immediately and continuing for a period of thirty-five (35) days from the
Effective Date hereof (the "Due Diligence Period") to conduct any inspections,
tests, or investigations, including, but not limited to lease, operating expense
and maintenance evaluations, feasibility studies, construction and engineering
studies, soil and hazardous materials and hazardous substances tests, water and
sewer capacity evaluations, and review of marketing materials, tax statements,
insurance policies, rent rolls, supplier and service contracts and conduct any
other study, test, investigation, or inspection which Buyer deems necessary, of
or upon the Subject Property. Without limiting the foregoing, it is expressly
agreed that Buyer shall have the right to engage in direct, full and unfettered
discussions with all existing tenants at the Subject Property (to be conducted
in Buyer's discretion outside the presence of any representatives of Seller);
with the expectation of such discussions to include without limitation current
lease terms, property condition and operations, future intent regarding renewals
and occupancy, and the financial conditions of each such tenant. Buyer shall
have the right to request (and Seller shall assist in seeking to obtain) a
Tenant Estoppel Certificate from any existing tenants at the Subject Property,
in the form of Schedule 2.2B, attached hereto. Seller shall instruct and cause
all site personnel to cooperate fully with Buyer and its agents to accomplish
and complete Buyer's due diligence as soon as possible. The Due Diligence Period
shall be extended as deemed reasonably necessary by Buyer if Seller fails to
deliver the Commitment and/or Survey within the time periods set forth in
Section 2.1. Buyer shall not disturb or unreasonably interfere with the tenant's
use or occupancy of its premises. In the event that Buyer has not provided its
written election to Seller prior to the end of the Due Diligence Period that
Buyer desires to pursue the closing of the transaction as contemplated herein,
this Agreement shall be deemed to be immediately terminated whereupon Buyer
shall be entitled to the return of the ▇▇▇▇▇▇▇ Money, less the sum of One
Hundred Dollars ($100.00) which shall be delivered to Seller. In the event of
such a termination, neither Seller nor Buyer shall have any further rights or
remedies against each other arising out of this Agreement.
In no event shall Buyer's election, as evidenced by its notice to
Seller pursuant to this Section 2.2B, constitute Buyer's approval of the title
and survey items which are subject to separate objection by Buyer under Section
2.1 above and the Seller's correction of the same. Buyer's due diligence and
inspections shall in no way dilute, amend or otherwise affect the
representations and warranties of Seller (or Buyer's rights relating thereto) or
the Conditions to Closing set forth in this Agreement.
C. Seller Furnished Information. Within five (5) business days
following the execution hereof, Seller shall deliver to Buyer the following
materials to the extent such information is in the custody or control of Seller
or reasonably available to Seller; provided, however, if any of the following
materials shall not then be available, Seller during the Due Diligence Period
shall provide such materials (as well as any updates of existing materials)
within five (5) days following Seller's receipt of the same:
(i) Copies of all Tenant Leases then in effect, with the original
Tenant Leases available for inspection by Buyer at any time during the Due
Diligence Period at the Subject Property;
(ii) A statement setting forth with respect to each of the Tenant
Leases: (a) the premises covered; (b) the date of the lease; (c) the name
of the tenant, licensee or occupant; (d) the rents and other charges
payable thereunder; (e) the rents
or other charges, if any, in arrears or prepaid thereunder, and the period
for which any such rents and other charges are in arrears, or have been
prepaid, and any cost recoveries related thereto; (f) the amount of any
security deposits thereunder; (g) options to renew or extend contained in
the lease, if any; and (h) any free rent, concessions, allowances, rebates
or refunds to which the tenant, licensee or occupant may have been or may
be entitled;
(iii) An inventory listing of the Personal Property, including
without limitation office furniture, office equipment and maintenance
equipment (the "Inventory");
(iv) A list of all management, maintenance, supply or service
contracts, leases, concessions or other agreements (oral or written) (the
"Contract List") pertaining to the management, maintenance, operation or
repair of the Subject Property, and a true and correct copy of each
document included on the Contract List or description, if such agreement
shall be oral;
(v) A copy of all reports or studies which in any way affect the
Subject Property, including but not limited to environmental and/or
asbestos reports or studies with respect to the Subject Property (or any
portion thereof), all reports and studies related to water usage, sewage
capacity and drainage of the Subject Property, soil reports, and previous
appraisals of the Subject Property in Seller's possession or control, and
any and all engineering reports, including structural, foundation,
plumbing, electrical, mechanical and civil engineering reports;
(vi) The as-built plans and specifications for the Subject
Property that Seller or its agents have in their possession, if any, to be
available for inspection of Buyer at the Subject Property;
(vii) Except as otherwise received by Buyer with the Commitment,
copies of any documents regarding easements, deed restrictions, covenants,
conditions, side letters or other documents encumbering the Subject
Property currently, or which to Seller's knowledge shall encumber the
Subject Property in the future;
(viii) Copies of utility availability and capacity letters from
the appropriate utility authorities with respect to water, wastewater,
electricity and gas utilities servicing the Subject Property;
(ix) All cost and expense documents requested by Buyer relating
to expenditures reported on the operating statements of the Subject
Property, including, but not limited to, copies of utility and repair
expenses for the immediately preceding three (3) full calendar years, and
the months of the current calendar year, ending prior to the date hereof;
(x) Copies of the most recent tax statements of the Land and
Improvements and any related assessments, bills, invoices, notices of
administrative hearings or litigation and copies of the tax statements of
the Subject Property for the years 1999 and thereafter and all notices of
assessed value or changes in proposed values and any and all correspondence
with any tax advisors of Seller or any information regarding tax valuation
appeals;
(xi) Copies of the statements of income and expense for the
calendar years ended 2000 and 2001 and for the calendar year 2002 to date
(or the last month for which such statements have been prepared) and a copy
of Seller's 2002 operating budget;
(xii) Copies of any governmental licenses and permits, special
use, nonconforming use and zoning variances and waivers, and any
certificates of occupancy related to the Subject Property;
(xiii) Copies of any and all bids or estimates obtained within
the preceding three (3) years for any work to be done on site for either
deferred maintenance or property improvements, including but not limited
to, bids or estimates for carpentry, painting, roofing, electrical,
plumbing, parking, fencing, furniture, equipment and signage, and any other
records of work orders, maintenance, or warranties pertaining to the
Subject Property during such period;
(xiv) Copies of any incident reports, area or project criminal
activity reports, insurance claims including details surrounding such
claim, or information and materials regarding any incidents or events of a
similar nature, but only if in the possession of Seller or its agents;
(xv) Copies of all loan documents relating to the Secured
Indebtedness, including without limitation, the promissory note, deed of
trust and any guaranties, assignments or escrow agreements relating
thereto, together with all amendments thereof, and any correspondence or
other agreements with Lender relative thereto; and (xvi) Copies of current
insurance policies relating to the Subject Property, together with a 2-year
loss history report.
2.3 Loan Assumption. During the Due Diligence Period, Buyer shall review
documents regarding the terms of the Secured Indebtedness and, provided Buyer
deems such terms acceptable, shall utilize its best efforts to promptly apply
for and diligently pursue the assumption of the Secured Indebtedness. In
connection therewith, Buyer shall not be responsible for any fees (of any type)
in excess of a one percent (1%) assumption fee, provided, notwithstanding the
foregoing, Buyer shall be responsible for payment or reimbursement of Lender's
disbursements and expenditures in connection with such loan assumption. In the
event that Buyer has not provided written notice to Seller on or before the
expiration date of the Due Diligence Period that the Lender holding the Secured
Indebtedness has irrevocably consented to the assumption of the Secured
Indebtedness on terms and conditions acceptable to Buyer, in Buyer's sole
discretion, this Agreement shall be deemed to immediately terminate, whereupon
Buyer shall be entitled to a return of the ▇▇▇▇▇▇▇ Money; provided, however,
that if the failure to obtain Lender's consent is the result of unreasonable
delays caused by Lender, Seller shall grant reasonable extensions to the Due
Diligence Period for the sole purpose of allowing completion of the loan
assumption process. In the event the loan assumption has not been approved in
writing on or before November 25, 2002, either Buyer or Seller may thereafter
terminate this Agreement, and the Buyer shall be entitled to the return of the
▇▇▇▇▇▇▇ Money.
ARTICLE III
SELLER'S REPRESENTATIONS
3.1 Seller's Representations. Seller hereby represents and warrants to
Buyer, its successors and assigns, that:
A. Violations. To Seller's knowledge after reasonable inquiry and
investigation, there are no conditions existing with respect to the Subject
Property which violate any law, rule, regulation or ordinance of any
governmental authority having jurisdiction over the Subject Property, and Seller
has received no notice from any governmental agency regarding and to Seller's
knowledge after reasonable inquiry and investigation there is no obligation
requiring the correction of any condition with respect to the Subject Property.
The Subject Property (and all improvements thereto) was originally constructed
in accordance with then-applicable building, zoning and fire codes and
regulations; and the Subject Property has been maintained in accordance with and
currently complies with applicable building, zoning and fire codes and
regulations. Seller has been issued and holds in its possession all necessary
permits and certificates of occupancy, which are now and as of the Closing shall
be current.
B. Special Assessments. There are no special or other assessments for
public improvements or otherwise currently affecting the Land or Improvements
nor has Seller received any notice that there are any pending or threatened
special assessments or contemplated improvements which would result in a special
assessment affecting the Subject Property.
C. Ad Valorem Tax. During the last five (5) years, the Subject
Property has not been subject to the benefit of any law reducing the ad valorem
tax rate based upon any open space or any other special valuation use.
D. Litigation. There are no legal proceedings of any type or nature
(including condemnation) pending or to Seller's knowledge after reasonable
inquiry and investigation threatened which (i) would adversely affect any
portion of the Subject Property, (ii) would adversely affect the ability of
Seller to perform its obligations, or (iii) relate to or arise out of the
ownership or operation of the Subject Property which are not fully and
adequately defended and covered by insurance.
E. Adverse Parties. There are no adverse parties in possession of any
part of the Subject Property, other than tenants under Tenant Leases.
F. Foreign Person. Seller is not prohibited from consummating the
transactions contemplated hereby and is not a "foreign person" as defined in
Section 1445(f) of the Internal Revenue Code of 1986, as amended.
G. Title. Seller now has and will have on the Closing good and
indefeasible title, right and interest in fee simple in and to all the Land and
Improvements constituting the Subject Property and will at Closing have such
interests free and clear of all liens, mortgages, easements, leases, tenancies,
encumbrances and defects other than liens relating to the Secured Indebtedness.
H. Right and Power. Seller has full right, power, and authority to
execute, deliver, and perform this Agreement without obtaining any consents or
approvals from, or the
taking of any other actions with respect to, any third parties (or if any such
consents, approvals, or other actions are required, the same will be
accomplished prior to the Closing), other than the consent of Seller's Board of
Directors approving this Agreement, which consent shall be sought on or before
October 16, 2002, and this Agreement when executed and delivered by Seller and
Buyer, will constitute the valid and binding agreement of Seller, enforceable
against Seller in accordance with its terms.
I. Liens. There are no liens against the Subject Property which will
not be satisfied out of the sales proceeds other than liens relating to the
Secured Indebtedness.
J. Hazardous Waste.
(i) To Seller's knowledge after reasonable inquiry and investigation,
Seller's use and operation of the Subject Property has heretofore been and on
the Closing Date shall be in material compliance with all Federal, state and
local environmental laws.
(ii) To Seller's knowledge after reasonable inquiry and investigation,
in its operation of its business at the Subject Property, Seller has never sent
or arranged for the transportation of hazardous substances or wastes to a site
which, pursuant to the Comprehensive Environmental Response Compensation and
Liability Act of 1980 ("CERCLA") or any similar state law: (a) has been placed
or is proposed (by the Environmental Protection Agency or relevant state
authority) to be placed on the "National Priorities List" of hazardous waste
sites or its state equivalent or on the Environmental Response, Comprehensive
and Liability Information System List, or (b) is subject to a pending claim, an
administrative order or other request to take "removal" or "remedial" action by
any person as those terms are defined under CERCLA.
(iii) To Seller's knowledge after reasonable inquiry and
investigation, there are no underground fuel or other storage tanks located on
the Land.
(iv) Seller has not received any notice of any environmental
contaminants on the Land or the Improvements during the period of Seller's
ownership of the Subject Property, nor to the best knowledge of Seller are there
currently (or have there been at any time) any hazardous substances or hazardous
waste (as defined under any applicable federal or state regulations) located on
or used in connection with the Subject Property, except nonmaterial amounts of
such materials used for cleaning purposes in accordance with applicable
regulations.
K. Service Contracts, Licenses and Leases. All management, service,
supply or maintenance agreements or other licenses or leases with respect to the
Subject Property are listed on Schedule 3.1K. Except for the Tenant Leases,
there are no management, service, supply or maintenance agreements or other
licenses or leases with respect to the Subject Property, or any portion thereof,
that (i) cannot be cancelled without liability upon thirty (30) days' notice,
without cause, or (ii) upon cancellation, would create, give rise to, or form
the basis of, a premium, penalty or charge, or (iii) upon cancellation would
create or give rise to a lien or other encumbrance on the Subject Property.
Seller warrants and represents that it has fully complied with and performed its
obligations under all such service agreements, leases and other agreements which
relate to the Subject Property.
L. Personal Property. All the Personal Property included in this sale
is owned by Seller free and clear of all liens and encumbrances, and title to
such Personal Property shall be transferred at Closing to Buyer by acceptable
▇▇▇▇ of Sale. All Personal Property shall be in reasonable working order and
condition as of the Closing.
M. Access. To Seller's knowledge, after reasonable inquiry and
investigation, there is no fact or condition existing which could result in the
termination of the current access from any portion of the Subject Property to
all presently existing roads or thoroughfares adjoining or situated on the
Subject Property.
N. Copies. All information and documents furnished to the Buyer by
Seller in relation to the Subject Property and this transaction constitute true,
correct, accurate and complete originals or copies thereof without material
misstatements or omissions and contain all related amendments, supplements and
schedules thereto.
O. Circumstances. To Seller's knowledge, after reasonable inquiry and
investigation, except as otherwise specifically disclosed to Buyer by schedule
hereto, there are no events, circumstances, conditions or matters known to
Seller which are (or may hereafter be) material and adverse to the Subject
Property.
P. Tenant Leases. A schedule identifying all Tenant Leases and related
security deposits (if any) is attached hereto as Schedule 3.1P. With respect to
the Tenant Leases, (i) true, correct and complete copies of each of such Tenant
Leases have been delivered to Buyer (and all originals thereof have been made
available to Buyer for inspection pursuant to Section 2.2C(i)), (ii) no event or
circumstance has occurred which (regardless of whether notice is required to be
furnished) could result in a breach or default by Seller or the respective
tenant under any of such Tenant Leases, (iii) no modification of any of the
Tenant Leases has occurred (whether by document, verbal arrangement, course of
conduct or otherwise), and (iv) no prepayments of any amounts due by the tenant
under any of the Tenant Leases has occurred. Seller represents that Seller has
no knowledge, data or information relating to the Tenant Leases which have not
otherwise been disclosed in writing to the Buyer; and, Seller has not been
informed, in writing or verbally, whether any Tenant intends (and Seller has no
reasonable basis to know whether any Tenant intends) to renew or not renew its
Tenant Lease upon the scheduled expiration date thereof; provided in no event is
Seller making any warranty or guarantee that any of the Tenants will or will not
renew their respective Leases at applicable renewal option periods.
Q. Seller's Performance. As of Closing, Seller shall have duly
performed all of the covenants and obligations to be performed by Seller under
this Agreement and delivered all documents, instruments and other items required
hereunder.
R. Closing Representations. Seller's representations and warranties
contained in this Agreement shall be true and accurate in all material respects
as of the date of Closing, with the same force and effect as if made on and as
of that date.
All of the warranties and representations contained herein shall
survive the Closing for a period of one (1) year from the date of Closing;
provided however, that the representations and warranties set forth at Sections
3.1G (Title) and 3.1H (Power and Right) shall survive the Closing indefinitely.
3.2 Buyer's Representations. Buyer hereby represents and warrants to Seller
that it has full right, power, and authority to execute, deliver, and perform
this Agreement without obtaining any consents or approvals from, or the taking
of any other actions with respect to, any third parties having an ownership
interest in Buyer (or if any such consents, approvals, or other actions are
required, the same will be accomplished prior to the Closing), and this
Agreement when executed and delivered by Seller and Buyer, will constitute the
valid and binding agreement of Buyer, enforceable against Buyer in accordance
with its terms.
ARTICLE IV
PRECLOSING AND CLOSING
4.1 Operation of Subject Property.
A. From the Effective Date through Closing, Seller, at no cost or
expense to Buyer, will make or cause to be made, all ordinary repairs and
replacements reasonably and customarily required with respect to any portion of
the Subject Property, and will operate and maintain the Subject Property or
cause the same to be operated and maintained in a manner consistent with
historical practice.
B. From the Effective Date through Closing, Seller will not further
encumber nor permit any further encumbrances (other than leases to third party
tenants) to the Subject Property, including, but not limited to service
agreements, without first obtaining the written consent of Buyer (which consent
shall not be unreasonably withheld or delayed), and during such period, Seller
further agrees not to modify, extend, renew or change any existing encumbrance
against the Subject Property prior to the earlier of Closing or the expiration
or termination of this Agreement without first obtaining the written consent of
Buyer (which consent shall not be unreasonably withheld or delayed).
C. From the Effective Date through Closing, without the prior written
consent of Buyer (which consent shall not be unreasonably withheld) Seller shall
not (i) amend or modify any Tenant Lease or any agreement relating to the
Subject Property which will affect the Subject Property following the
contemplated Closing, or (ii) enter into any new lease for the Subject Property
or any portion thereof which will extend past the Closing (except that Seller
shall not be required to obtain the prior written consent of Buyer to enter into
any renewal or new Tenant Lease which contains terms, in the reasonable business
judgment of Seller, which are equivalent to or better than those of existing
Tenant Leases).
4.2 Risk of Loss. The risk of loss in the event of casualty shall rest
exclusively with the Seller until the Closing has occurred. Thereafter, Buyer
will assume the full risk of loss. In the event a portion of the Subject
Property is damaged or destroyed prior to Closing and the aggregate repair and
restoration expenses are reasonably estimated to be less than $50,000, Seller
shall repair and restore the damage to Buyer's reasonable satisfaction. In the
event the repair or restoration is not completed by Closing, the parties shall
establish a reasonably acceptable escrow fund from the sale proceeds to secure
completion of such repairs. In the event a portion of the Subject Property is
damaged or destroyed and the aggregate repair and restoration expenses are
reasonably estimated to exceed $50,000, Buyer may elect to: close the
transaction without any reduction in the Purchase Price except for the amount of
the insurance deductible (if any), in which event Buyer shall be entitled to the
insurance proceeds; or terminate the Agreement, in which event Buyer shall be
entitled to return of the ▇▇▇▇▇▇▇
Money. Buyer's failure to make such election within twenty (20) days after
receipt of written notice of such damage from Seller shall be deemed an election
to close the transaction.
4.3 Condemnation. If at any time prior to the Closing, any material portion
of the Land or Improvements is threatened with condemnation or legal proceedings
commenced under the power of eminent domain, Seller shall promptly give Buyer
written notice of such fact, and shall furnish to Buyer copies of all notices
received by Seller pertaining thereto. Buyer shall have the right, within five
(5) business days after the receipt of such notice, to terminate this Agreement
by written notice to Seller, in which event Buyer shall be entitled to the
return of its ▇▇▇▇▇▇▇ Money and neither Seller nor Buyer shall have any further
obligations hereunder. If this Agreement is not so terminated, Buyer shall be
obligated to proceed with the Closing hereunder and all damages awarded by the
Court in connection with such proceedings shall belong to the Buyer. The
Purchase Price will not be abated or reduced on account of any such proceedings.
4.4 Seller's Closing Obligations. At Closing, Seller shall deliver or
tender the following items:
A. Special Warranty Deed (acceptable to the Title Company), in the
form of Schedule 4.4A attached hereto;
B. Tax certificates (as provided in Section 4.10 below);
C. Seller's Statement and any other statements or documents reasonably
requested by Title Company;
D. ▇▇▇▇ of Sale, assigning and conveying to Buyer title to all the
Personal Property, free and clear of all liens and encumbrances, other than the
Permitted Exceptions, in the form of Schedule 4.4D attached hereto;
E. Assignment of Service Contracts (if any, as selected by Buyer),
Warranties (including roof warranties), Governmental Approvals and Trade Names,
in the form of Schedule 4.4E attached hereto;
F. Assignment of the Seller's rights in the Tenant Leases in the form
of Schedule 4.4F attached hereto;
G. Copies of records and files relating to the operation and
maintenance of the Subject Property which have not previously been delivered to
Buyer;
H. If Seller is an entity, a Non-Foreign Affidavit for Entity Transfer
in the form of Schedule 4.4H attached hereto;
I. Keys to all locks and all tenant records (including applications,
correspondence and credit reports regarding present tenants, if any); and
J. Security, advance rental and other deposits actually held by Seller
relating to the Subject Property.
K. Such other documents and agreements as may be reasonably requested
to implement the Closing hereunder.
4.5 Buyer's Closing Obligations. At Closing the Buyer shall deliver or
tender the following items:
A. The cash portion of the Purchase Price plus all charges to be paid
by Buyer at Closing less all credits available to Buyer at Closing;
B. Copies of all loan assumption documents relating to the Secured
Indebtedness;
C. Any statements or documents required from Buyer by the Title
Company;
D. Assumption of the Seller's rights in the Tenant Leases, in the form
of Schedule 4.4F attached hereto; and
E. Such other documents and agreements as may be reasonably requested
to implement the Closing hereunder.
4.6 Conditions to Closing.
A. Buyer's Conditions. All of the obligations of Buyer under this
Agreement are in all events further subject to and conditioned upon the
fulfillment (unless waived in writing by Buyer) of the following conditions
precedent:
(i) Buyer shall be satisfied in its sole and absolute discretion
with the suitability and feasibility of the Subject Property following its
due diligence review and have provided the notice to of Buyer's intent to
proceed with Closing as set forth under Section 2.2B;
(ii) Buyer shall have received irrevocable written approval from
Lender for the assumption of the Secured Indebtedness on terms mutually
agreeable between Buyer and Lender, and the Buyer's assumption of the
Secured Indebtedness shall have occurred concurrent with the Closing
hereunder;
(iii) There shall have been no casualty, damage or material
adverse effect to the Subject Property, nor shall Seller or Buyer have
received notice regarding any pending or contemplated condemnation of any
material portion of the Subject Property or impairment of access or use of
the Subject Property;
(iv) The Subject Property is not in violation of any applicable
law, ordinance or regulation, nor shall Seller or Buyer have received
notice of any such possible violation;
(v) Seller's representations contained in this Agreement shall be
deemed to have been made again at and as of the time of the Closing and
shall then be true and accurate;
(vi) Seller shall have duly performed all of the covenants and
obligations to be performed by it under this Agreement and shall have
delivered the documents, instruments and other items requested by Buyer
under this Agreement;
(vii) Buyer shall have received a "marked up" Title Commitment
dated as of the date of Closing and issued by the Title Company which
unconditionally commits the Title Company to issue the owner policy of
title insurance described in Section 4.9 hereof; and, Seller shall have
effected the cure of all Title Objections presented by Buyer, which cure is
acceptable to Buyer in its sole discretion; and, the zoning letters
furnished to Buyer shall be reasonably acceptable;
(viii) The Subject Property shall be conveyed as of the Closing,
free and clear of any and all liens and encumbrances, subject to the
Permitted Exceptions;
(ix) Seller shall have furnished to Buyer the Survey in the
manner required hereunder; and, Seller shall have effected the cure of all
Survey Objections presented by Buyer, which cure is acceptable to Buyer in
its sole discretion;
(x) All leases or other rights of parties in possession (other
than the Tenant Leases and other leases approved by Buyer) shall have been
terminated prior to Closing;
(xi) If applicable, Buyer shall be reasonably satisfied with the
results of all inspections and treatment for wood-eating or destroying
insects or otherwise elected to proceed with Closing, as set forth in
Section 4.16 hereof;
(xii) The Closing shall be an insured Closing with the Title
Company pursuant to an insured closing letter, on terms deemed reasonable
by Buyer; and
B. Seller's Conditions. All of the obligations of Seller under this
Agreement are further subject to and conditioned upon the fulfillment (unless
waived in writing by Seller) of the following conditions precedent:
(i) Buyer's representations contained in this Agreement shall be
deemed to have been made again at and as of the time of Closing and shall
then be true and accurate;
(ii) Buyer shall have duly performed all of the covenants and
obligations to be performed by it under this Agreement and shall have
delivered all of the documents, instruments and other items required to be
delivered by it under this Agreement; and
(iii) Seller shall have received all consents and approvals
necessary for the performance of Seller's obligations under this Agreement.
C. Effect of Closing. If for any reason any one or more of the
conditions precedent described in Sections 4.6A and 4.6B shall not have been
fulfilled prior to or at the Closing, the party whose condition was not
fulfilled, as such party's sole and exclusive remedies, (i) shall have the right
to terminate this Agreement, or (ii) in the event Buyer is such party, Buyer
shall have the right to close this transaction with Buyer thereby waiving any
such unfulfilled condition.
4.7 Additional Instruments. In addition to the instruments and actions
enumerated above, both Seller and Buyer shall additionally furnish or provide to
each other and to the Title Company any other instruments mentioned in this
Agreement, and any other ancillary instruments which are reasonably required by
the Title Company to properly consummate the transaction or which are
customarily executed in the county where the Subject Property is situated to
effectuate the conveyance of property similar to the Subject Property.
4.8 Special Warranty of Title. Seller shall convey good and indefeasible
fee simple title to the Subject Property to Buyer by Seller's delivery to Buyer
of a Special Warranty Deed which deed shall be in form acceptable to the title
insurance company, fully executed and acknowledged by Seller, subject to no
assessments, liens, indebtedness, restrictions, easements, right-of-way, mineral
reservations or royalties, encumbrances, or other exceptions to good and
indefeasible title except the Permitted Exceptions.
4.9 Title Insurance. Seller shall cause to be issued to Buyer, as the named
insured, an Owner Policy of Title Insurance (the "Title Policy") in the full
amount of the purchase price for the Subject Property insuring that Buyer has
good and indefeasible title to the Subject Property subject only to Permitted
Exceptions. All standard printed exceptions shall be deleted.
4.10 Taxes. At Closing, Title Company shall furnish to Buyer, at Seller's
expense, tax certificates from an ad valorem tax service company evidencing the
payment of all taxes applicable to the Subject Property through the calendar
year immediately preceding the calendar year during which the Closing occurs. As
to taxes for the calendar year in which the sale contemplated hereby is closed,
the parties agree as follows:
A. To the extent any special assessments exist in relation to the
Subject Property as of the date of Closing, such special assessments amounts
shall be deducted from the Purchase Price cash proceeds due Seller and paid to
the title Company to be held in escrow and paid to the appropriate taxing
authority when and as due.
B. Other real estate taxes shall be prorated as of the date of Closing
in the customary manner in ▇▇▇▇▇▇▇ County, Nebraska.
4.11 Income and Expense Proration. All rents, and prepaid expenses of
utility charges, insurance premiums on assigned policies (if any), and other
income or expense items relating to the Subject Property shall be prorated as of
the Closing Date. Such proration shall be implemented as hereinafter provided.
At Closing, all rents and real estate taxes shall be prorated. The parties shall
thereafter implement a post-Closing adjustment on the date which is sixty (60)
days after Closing in order to prorate all accounts payable, utility charges and
other expense items relating to the Subject Property wherein (i) Buyer shall
reimburse Seller for the pro rata portion of such expenses paid by Seller which
are attributable to periods from and after Closing; and (ii) Seller shall
reimburse Buyer for the pro rata portion of such expenses paid by Buyer which
are attributable to periods prior to Closing. Only prepaid expenses which are
reasonable, of value to Buyer, and pertinent to services rendered at the Subject
Property, will be prorated. Prepaid expenses shall not include on site inventory
of supplies, equipment, furniture, licenses or permits or other Personal
Property transferred with the Subject Property. Buyer shall pay to Seller the
amount of any assigned security deposits retained by Buyer, at its option, with
any utility companies. If final readings and ▇▇▇▇▇▇▇▇ cannot be obtained as of
the date of Closing, the final bills when received shall be prorated based upon
the number of days Seller owned the Subject Property in such final billing
period. The proration of rent shall be based on
actual rent collected. In the event there are rents due but unpaid, and same
shall be collected after Closing by Buyer, that portion of the rent paid for
periods prior to Closing shall be delivered by Buyer to Seller; provided,
however, Buyer shall have no obligation to attempt to collect any such unpaid
rents, and provided further, however, that any rents received following Closing
shall be presumed to be for periods arising after Closing, unless otherwise
specified by the Tenant in writing. All security deposits (and any interest
payable thereon) relating to the Tenant Leases shall be transferred to Buyer as
a part of the Purchase Price and shall not be subject to any proration or
additional payment by Buyer.
4.12 Closing Costs. All costs relating to the Closing of this transaction
(the "Closing Costs") shall be borne by the parties as follows:
A. Seller. All premiums for the Title Policy (attributable to a
standard owner's and mortgagee's title policy, excluding deletion of survey
exceptions) and addition of zoning endorsements or zoning letters from local
governments in a form and content acceptable to Buyer, one half (1/2) of
recording fees (excluding fees relating to recording of documents in relation to
assumption of the Secured Indebtedness), all documentary stamp fees for the
recording of any documents (including recording of the Deed or any lien release
or assignment documents), all costs of obtaining tax information and copies of
title documents, Seller's attorneys' fees and one half (1/2) of any escrow fees
and such other expenses customarily borne by a seller in ▇▇▇▇▇▇▇ County,
Nebraska.
B. Buyer. Endorsements to the Title Policy as Buyer may deem
appropriate, one half (1/2) of recording fees, all costs of Buyer's due
diligence investigation (including architects, consulting engineers, investment
bankers, real estate advisors, consulting accountants and other professional
fees), all costs associated with any financing or assumption of the Secured
Indebtedness (provided such loan assumption fees shall not exceed 1.0% of the
loan assumed), Buyer's attorneys' fees and one half (1/2) of any escrow fees.
4.13 Possession. At Closing, Buyer shall be placed in possession of the
Subject Property free and clear of any rights of Seller or any third party
(other than written Tenant Leases and other lessees approved by Buyer) except as
set forth in the Permitted Exceptions.
4.14 Assumption of Operating Agreements. At Closing, Buyer shall assume the
service, supply and maintenance agreements relating to the Subject Property
selected by Buyer, if any, and designated by Buyer to Seller in a written
document furnished during the Due Diligence Period. Seller shall remain
responsible for, and shall indemnify, defend and hold harmless Buyer from and
against any liability, loss, damage or expense relating to or arising out of
action or inaction by Seller prior to Closing under any of the assumed
agreements.
4.15 Remedies.
A. Seller's Default. Upon Seller's failure to close this transaction
for any reason other than Buyer's default, Buyer, as Buyer's sole and exclusive
remedies, may (i) terminate this Agreement and the ▇▇▇▇▇▇▇ Money shall be
returned to Buyer, or (ii) exercise the right to enforce specific performance to
require Seller to convey the Subject Property under this Agreement (in which
event Seller shall convey title to the Subject Property in accordance with this
Agreement as nearly as practicable; and in the event such condition of title is
unacceptable to Buyer in its sole discretion, Buyer may thereupon terminate this
Agreement and the ▇▇▇▇▇▇▇ Money shall be returned to Buyer).
B. Buyer's Default. If Buyer wrongfully fails or refuses to consummate
the purchase of the Subject Property pursuant to this Agreement for any reason
other than termination of this Agreement by Buyer or Seller pursuant to a right
to terminate set forth in this Agreement or Seller's failure to perform Seller's
obligation under this Agreement, or failure of any condition precedent, then
Seller, as Seller's sole and exclusive remedy, shall have the right to terminate
this Agreement by giving written notice thereof to Buyer prior to or within five
(5) business days of the scheduled Closing Date, whereupon neither party hereto
shall have any further rights or obligations hereunder, except Seller shall
retain the ▇▇▇▇▇▇▇ Money and the Title Company shall deliver the ▇▇▇▇▇▇▇ Money
to Seller as liquidated damages in complete satisfaction of all liability of
Buyer hereunder. It is agreed that the ▇▇▇▇▇▇▇ Money to which Seller is entitled
hereunder is a reasonable estimate of just compensation for the harm that would
be caused by Buyer's breach and that the harm that would be caused by such
breach is one that is incapable or very difficult of accurate estimation, and
that the payment of the ▇▇▇▇▇▇▇ Money upon such breach shall constitute full
satisfaction of Buyer's obligations hereunder.
4.16 Wood-Destroying Insects. If Buyer so elects during the Due Diligence
Period, Buyer may (at its cost) obtain an inspection and report ascertaining
whether the Subject Property is free from infestation of wood-eating or
destroying insects, including without limitation termites. If any infestation is
identified at the Subject Property, Seller shall treat all buildings and
structures at the Subject Property to the satisfaction of Buyer at a cost not to
exceed $2,500 for total of treatment and/or repairs. If the cost estimate
exceeds $2,500, Buyer shall have the option in its sole discretion to either (i)
receive a $2,500 credit to the Purchase Price and proceed to close, or (ii)
cancel this Agreement and receive a full refund of the ▇▇▇▇▇▇▇ Money.
4.17 Reimbursement of Expenses. In the event Seller has not provided its
written confirmation that Seller's Board of Directors has unconditionally
approved the terms of this Agreement and authorized the transaction hereunder,
on or before October 16, 2002, Buyer shall have the right to terminate this
Agreement and thereupon to receive reimbursement of Buyer's out-of-pocket
expenses, actually incurred, in connection herewith, including without
limitation loan application fees, survey and phase I expenses and legal fees;
provided however, that the maximum amount of reimbursed fees due Buyer under
this Section shall be the aggregate sum of $20,000. Payment of such reimbursable
items shall be made from Seller to Buyer within three (3) days following Buyer's
documentation of the same.
ARTICLE V
MISCELLANEOUS PROVISIONS
5.1 Mutual Indemnification.
A. Seller shall indemnify, defend and hold Buyer, its officers,
directors, members and agents, harmless from and against all losses,
liabilities, claims, damages, costs and expenses (including reasonable
attorneys' fees and disbursements) arising from or relating to (i) any breach of
Seller's representations, obligations or performance under this Agreement; and
(ii) any claim made by a third party relating to or arising out of Seller's
ownership, operation, maintenance or repair of the Subject Property or the
condition, operation or use of the Subject Property at any time prior to
Closing.
B. Buyer shall indemnify, defend and hold Seller, its employees and
agents, harmless from and against all losses, liabilities, claims, damages,
costs and expenses (including
reasonable attorneys' fees and disbursements) arising from or relating to (i)
any breach of Buyer's representations, obligations or performance under this
Agreement; and (ii) any claim made by a third party relating to or arising out
of Buyer's ownership, operation, maintenance or repair of the Subject Property
or the condition or use of the Subject Property at any time after Closing.
C. In order to make a claim hereunder, the indemnified party shall
notify the other party in writing, and shall include sufficient documentation
relating to such claim to provide the indemnifying party with a reasonable
explanation of the claim. As to third-party claims, the indemnifying party shall
have the right to contest and defend, with the counsel of its choice, any and
all such claims by such third party and shall have no obligation to pay the
indemnified party (except that costs of defense of the claim shall be paid by
the indemnifying party when and as incurred) unless and until there has been a
final adjudication of indemnified party's obligation to pay such third party.
However, if the indemnifying party fails for any reason to defend the action,
the indemnified party shall be entitled to control such defense and the
indemnifying party shall promptly reimburse all attorneys' fees and other
defense costs when and as incurred. In no event shall any claim be settled or
resolved without approval of the indemnified party (which approval of the
indemnified party shall not be unreasonably withheld). However, any settlements
which require the indemnified party to either take action or refrain from taking
action other than the payment of money shall be subject to the approval of the
indemnified party in its absolute good faith discretion.
5.2 Environmental Indemnity. Seller shall indemnify, defend and save and
hold harmless Buyer, its directors, officers, shareholders, managers, members
and agents, from and against any and all losses, liabilities, damages, costs and
expenses (including, but not limited to, loss of property value, or defects in
title to the Subject Property, and the reasonable fees and disbursements of the
Buyer's legal counsel) suffered or incurred by the Buyer, its directors,
officers, shareholders, managers, members or agents, as a result of or in
connection with, directly or indirectly: (i) the occurrence of any environmental
activity or any failure of Seller or any of its agents, employees or invitees to
comply with all applicable environmental requirements, regulations or ordinances
relating to the Subject Property or the use of the Subject Property prior to the
Closing Date; (ii) any investigation, inquiry, order, hearing, action or other
proceeding by or before any governmental agency which has resulted or is alleged
to have resulted directly or indirectly from any environmental activity relating
to the Subject Property or the use of the Subject Property prior to the Closing
Date; (iii) any failure of any representation or warranty of Seller set forth in
Section 3.1J above to be correct in all respects as of the date hereof; or (iv)
any claim, demand or cause of action, or any action or other proceeding, whether
meritorious or not brought or asserted against Buyer, its directors, officers,
shareholders, managers, members or agents which directly or indirectly relates
to, arises from or is based on any of the matters described in clauses (i)
through (iii) of this Section 5.2 or any allegation of any such matters.
5.3 Confidentiality. This Agreement, the negotiations of the parties, the
data and information furnished by either party to the other, and the terms
hereof shall remain confidential and shall not be disclosed by either party
without the express prior written consent of the other party hereto. The
provisions of this section, however, shall not apply to any disclosures or
statements required to be made by law or regulation of any federal, state or
local government agency. In addition, Seller shall not provide any information
about the Subject Property, with the intent or for the purpose of selling or
soliciting any offer for the purchase of the Subject Property, or any portion
thereof, or discuss with any other potential purchaser the possible sale
of the Subject Property, or sell or agree to sell or otherwise dispose of any
interest in the Subject Property; provided however, Seller may advise any
potential purchaser of the Subject Property (or any portion thereof) with whom
Seller has negotiated prior to the date of this Agreement for the purchase of
the Subject Property (or any portion thereof) that a Purchase Agreement for the
sale of the Subject Property is pending.
5.4 Assignment. The rights and interest of Buyer under this Agreement may
be assigned by Buyer without the written consent of Seller, provided that
Buyer's assignee assumes all of the obligations of Buyer under this Agreement,
and provided further that such assignee is an entity, the controlling interest
of which is held by the holders of the controlling interest of Buyer. In the
event of an assignment, the assignee(s) shall assume all obligations of this
Agreement and confirm all its representations and warranties and SGD
Investments, Inc., as Buyer, shall have no further obligation or liability
hereunder.
5.5 Governing Law. This Agreement shall be construed under and in
accordance with the laws of the State of Nebraska and all obligations of the
parties are performable in ▇▇▇▇▇▇▇ County, Nebraska. The exclusive venue for any
disputes hereunder shall be ▇▇▇▇▇▇▇ County, Nebraska.
5.6 Parties. This Agreement shall be binding upon and inure to the benefit
of the parties hereto and their respective heirs, executors, administrators,
legal representatives, successors and assigns where permitted by this Agreement.
5.7 Entire Agreement. This Agreement supersedes any and all other
agreements, either oral or written, between the parties hereto with respect to
the subject matter hereof and contains all of the covenants and agreements
between the parties with respect to this matter. Each party acknowledges that no
representations, inducements, promises, or agreements, oral or otherwise, have
been made by any party, or anyone acting on behalf of any party, which are not
embodied herein, and that no other agreement, statement, or promise not
contained in this Agreement shall be valid or binding upon the parties. Any
change hereto shall be effective only if in writing and duly executed by the
respective parties.
5.8 Attorneys' Fees. In the event of any litigation in relation to this
Agreement, the prevailing party, in addition to all other sums that the other
party may be required to pay, shall recover a reasonable sum for the prevailing
party's attorney's fees and costs.
5.9 Time. Time is of the essence of this Agreement.
5.10 Brokers. ▇▇▇▇▇ & ▇▇▇▇▇ Pacific Realty has acted as broker on behalf of
Seller, and Seller shall be solely responsible for and pay all real estate
commissions due such broker, which shall not exceed one and one-half percent
(1.5%) of the Purchase Price. The real estate commission and fees shall be
payable at Closing, but contingent upon this transaction being closed. Seller
hereby agrees to defend, indemnify and hold harmless Buyer from and against any
claims by third parties with whom Seller worked for brokerage commissions,
finders' or other fees relative to this Agreement or the sale of the Subject
Property and any court costs, attorneys' fees or other costs or expenses arising
therefrom and alleged to be due by authorization of the Seller. Buyer hereby
agrees to defend, indemnify and hold Seller harmless from and against any claims
by third parties with whom Buyer worked for brokerage commissions, finders' or
other fees relative to this Agreement or the sale of the Subject Property
and any court costs, attorneys' fees or other costs or expenses arising
therefrom and alleged to be due by authorization of the Buyer.
5.11 No Merger. The provisions of this Agreement containing agreements
between the parties relating to actions occurring after Closing shall not be
merged into the instruments of Closing but shall expressly survive and be
enforceable according to their terms.
5.12 Notices. Except as may be otherwise specifically provided in this
Agreement, all notices required or permitted hereunder shall be in writing and
unless personal delivery is effected, shall be deemed delivered upon (i) deposit
in the United States Mail, postage prepaid, registered or certified mail, return
receipt requested or Express Mail, or (ii) delivery prepaid to Federal Express
or other overnight delivery service for next-day delivery, addressed to the
parties at the respective addresses set forth below or at such other addresses
as may be later specified by written notice delivered in accordance herewith, or
(iii) facsimile addressed to the party at the facsimile number set forth below
and mailing in the manner set forth in (i) above.
SELLER: With Copies To:
ACI FINANCING, L.L.C. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
BUYER: With Copies To:
SGD INVESTMENTS, INC. MCGILL, GOTSDINER, ▇▇▇▇▇▇▇ & ▇▇▇▇, P.C., L.L.O.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, # ▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇ Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
Fax: (▇▇▇) ▇▇▇-▇▇▇▇ Fax: (▇▇▇) ▇▇▇-▇▇▇▇
5.13 Holidays. If any date for the performance of any matter set forth in
this Agreement falls on a Saturday, Sunday or legal holiday, then that date
shall be extended to the next day which is not a Saturday, Sunday or legal
holiday.
5.14 Section Headings. The headings assigned to various portions of this
Agreement are for convenience only and shall not alter the substance of this
Agreement.
5.15 Counterparts. This Agreement may be executed in any number of
counterparts and each shall be deemed to constitute an original for all
purposes.
5.16 Interpretation. Buyer and Seller hereby acknowledge that each has been
represented by legal counsel in the negotiation, execution and implementation
hereof; and accordingly the terms or provisions hereof shall be interpreted and
construed in a commercially reasonable manner and not against the interests of
the drafter of this Agreement.
5.17 Best Knowledge of Seller. Reference in this Agreement, or the
schedules hereto, to Seller's "best knowledge" shall refer to (a) such facts of
which Seller (its officers, directors and primary operators) has actual
knowledge after reasonable inquiry and investigation, and (b) such facts of
which Seller has theretofore received written notice or correspondence.
5.18 Facsimile Signatures and Initials. Facsimile signatures and initials
on this Agreement and Schedules shall be binding and enforceable.
5.19 Interest Earned on ▇▇▇▇▇▇▇ Money. In the event the ▇▇▇▇▇▇▇ Money shall
for any reason be refunded to Buyer, or if provided hereunder, delivered to
Seller in connection with a termination of this Agreement, Buyer shall in all
events be entitled to all interest and other amounts earned thereon.
5.20 Amendment. This Agreement may be amended or modified only by written
document executed by Buyer (or its permitted assignee) and Seller; and, Escrow
Agent need not sign any such amendment in order for it to be effective.
5.21 Pending Litigation. It is specifically agreed that Seller shall in all
events remain liable for any liability relating to or arising out of claims and
litigation pending as of the Closing Date (if any) regardless of when such
liability shall arise, which liability shall include without limitation,
liability for insurance deductibles and uninsured losses.
[Remainder of page intentionally left blank]
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date and year first above written.
SELLER:
ACI FINANCING, L.L.C.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: CEO
Date: 10/14/02
BUYER:
SGD INVESTMENT, INC., a Nebraska corporation
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Secretary
Date: 10/15/02
Effective Date Acceptance
By the Title Company
The Effective Date of this Agreement as defined in Section 1.2D is October
16, 2002. The Title Company hereby acknowledges receipt of a fully executed copy
of the foregoing Purchase Agreement and the ▇▇▇▇▇▇▇ Money referred to in Section
1.2B and agrees to accept, hold, and return the ▇▇▇▇▇▇▇ Money and disburse any
funds received hereunder in accordance with the provisions of this Agreement and
specifically with respect to Section 4.15 herein.
ASSURED QUALITY TITLE CO.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
Date: 10/16/02