FORMS OF AGREEMENT FOR
CONTRIBUTION OF INTERESTS
AGREEMENT FOR CONTRIBUTION OF INTERESTS
[TWO PENN PLAZA]
THIS AGREEMENT for the Contribution of Interests (this "Agreement")
is made and entered into as of ___________, 1996, by and among The Mendik
Company, L.P. ("Operating Partnership"), a Delaware limited partnership,
whose managing general partner is the Mendik Group, Inc. (the "REIT"), a
Delaware corporation, each of the parties listed on Exhibit A annexed hereto
who executes a Partner Consent (hereinafter defined) agreeing to become a
party to this Agreement (collectively referred to herein as "Contributors")
and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ (in his capacity as a general partner of the
Partnership (hereinafter defined), the "General Partner").
WHEREAS, it is desired to consolidate (the "Consolidation")
interests in up to seven general or limited partnerships or limited liability
companies of which the General Partner or an affiliate is a general partner,
together with the assets of Mendik Realty Company, Inc. and Mendik Management
Company, Inc., each a New York corporation and affiliate of the General
Partner, with and into Operating Partnership and to effect the initial public
offering (the "Offering") of shares of common stock of the REIT ("Common
Stock").
WHEREAS, prior to the Consolidation, the REIT shall merge into The
Mendik Company, Inc., a Maryland corporation, and from and after such merger,
all references herein to the REIT shall refer to The Mendik Company, Inc.
WHEREAS, Contributors are owners of interests (the "Contributed
Interests") in Two Penn Plaza Associates L.P., a New York limited partnership
(the "Partnership"), which Partnership owns land and improvements (the
"Property") known as ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇;
WHEREAS, in connection with the consummation of the Consolidation
and the Offering, the parties hereto desire that Operating Partnership and,
if designated by Operating Partnership, one or more special purpose
subsidiary partnerships or limited liability companies of Operating
Partnership or one or more other entities controlled by Operating Partnership
(each a "Designated Subsidiary") acquire all of the interests in the
Partnership through the contribution of such interests to Operating
Partnership and/or one or more Designated Subsidiaries upon the terms and
conditions provided herein and simultaneously acquire all of the interests in
the Partnership owned by a major partner and its affiliates (collectively,
the "Major Partner") pursuant to an Agreement (the "Major Partner Agreement")
expected to be entered into between the Major Partner and ▇▇ ▇▇▇▇▇▇ REIT LLC,
which Major Partner Agreement shall be assigned to Operating Partnership
and/or a Designated Subsidiary prior to the Closing (hereinafter defined);
and
WHEREAS, if the holders of all of the interests in the Partnership
(other than the Major Partner) do not execute the Partner Consent annexed to
and made a part of the Memorandum (the "Partner Consent") or the Major
Partner does not execute, or close under, the Major Partner Agreement, it is
contemplated that Operating Partnership may attempt to effect the
Consolidation in another manner, through a transfer of the Property to
Operating Partnership (or a Designated Subsidiary) or merger of the
Partnership with Operating Partnership (or a Designated Subsidiary) or other
means.
NOW, THEREFORE, in consideration of the foregoing and the mutual
promises and covenants set forth herein, Operating Partnership, Contributors
and the General Partner hereby agree as follows:
1. CONTRIBUTIONS. Upon the Closing, and subject to the
satisfaction or waiver by Operating Partnership of the conditions set forth
in Section 7 of this Agreement, Contributors shall contribute, convey and
assign to Operating Partnership (and/or Designated Subsidiary) and Operating
Partnership (and/or Designated Subsidiary) shall acquire from Contributors
all of Contributors' right, title and interest in the Contributed Interests
(the "Contributions"), including, without limitation, all of Contributors'
interest in the profits, losses, property and capital of the Partnership
allocable to the Contributed Interests, upon the terms and conditions set
forth in this Agreement.
2. CONSIDERATION; DISTRIBUTIONS PRIOR TO CLOSING.
(a) In full consideration for the contribution of the
Contributed Interests, Operating Partnership shall deliver to Contributors at
the Closing, units of limited partnership interests ("Units") in Operating
Partnership determined in accordance with the methodology described in the
Confidential Solicitation of Consents and Private Placement Memorandum (the
"Memorandum") dated November 11, 1996.
(b) On the date of the Closing (the "Closing Date"), the
General Partner shall cause the Partnership to distribute approximately
$1,600,000 to the Major Partner and to distribute approximately $800,000 to
the General Partner, as agent for the Contributors, to pay the Conveyance
Taxes payable by them pursuant to Section 9(b) hereof.
3. ACCEPTANCE OF CONTRIBUTIONS. Operating Partnership hereby
agrees that at the Closing it shall accept the Contributions and shall assume
any and all rights, obligations and responsibilities of Contributors as
owners of the Contributed Interests that arise from and after the Closing
Date.
4. CLOSING TIME AND PLACE. Unless another date or place is
agreed to by the parties, the closing of the Contributions (the "Closing")
shall take place contemporaneously with the closing of the Consolidation and
the Offering at the offices of Proskauer ▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇ LLP, ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or such other place and time as Operating
Partnership and the General Partner shall agree upon, upon the satisfaction
or waiver of all conditions to the Closing set forth in Section 7 hereof.
5. REPRESENTATIONS AND WARRANTIES OF OPERATING PARTNERSHIP.
Operating Partnership hereby represents and warrants to Contributors as
follows, which representations and warranties shall be true and correct on
the Closing Date:
5.1 ORGANIZATION, POWER AND AUTHORITY, AND QUALIFICATION.
Operating Partnership is a limited partnership duly organized, validly
existing and in good standing under the laws of the State of Delaware. The
REIT is a corporation duly organized, validly existing and in good standing
under the laws of its state of incorporation. Each of Operating Partnership
and the REIT has the requisite power and authority to carry on its respective
business as it is now being conducted. Each of Operating Partnership and the
REIT is qualified to do business and is in good standing in each jurisdiction
in which the character of its property owned or leased or the nature of its
activities makes such qualification necessary, except where the failure to be
so qualified and in good standing would not have a material adverse effect on
the business or financial condition of Operating Partnership or the REIT, as
the case may be.
5.2 AUTHORITY RELATIVE TO THIS AGREEMENT. Operating Partnership
has taken all action necessary to authorize the execution, delivery and
performance of this Agreement by Operating Partnership and no other
proceedings on the part of Operating Partnership are
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necessary to authorize the execution and delivery of this Agreement and the
consummation of the Contributions.
None of the execution and delivery of this Agreement by Operating
Partnership, the consummation by Operating Partnership of the Contributions
or compliance by Operating Partnership with any of the provisions hereof
shall (i) conflict with or result in any breach of any provisions of the
Partnership Agreement of Operating Partnership; (ii) result in a violation or
breach of, or constitute (with or without due notice or lapse of time or
both) a default (or give rise to any right of termination, cancellation or
acceleration) under any of the terms, conditions or provisions of any note,
bond, mortgage, indenture, lease, license, contract, agreement or other
instrument or obligation to which Operating Partnership is a party or by
which it or any of its properties or assets may be bound; or (iii) violate
any order, writ, injunction, decree, statute, rule or regulation applicable
to Operating Partnership; except in the case of (ii) or (iii) for violations,
breaches, or defaults (A) that would not in the aggregate have a material
adverse effect on the business or financial condition of Operating
Partnership or the REIT, and that shall not impair the effectiveness of the
Contributions contemplated hereby, or (B) for which waivers or consents have
been or shall be obtained prior to the Closing Date.
5.3 BINDING OBLIGATION. This Agreement has been duly and validly
executed and delivered by Operating Partnership and constitutes a valid and
binding agreement of Operating Partnership, enforceable against Operating
Partnership in accordance with its terms, except that such enforcement may be
subject to bankruptcy, conservatorship, receivership, insolvency, moratorium,
or similar laws affecting creditors' rights generally or the rights of
creditors of limited partnerships and to general principles of equity.
5.4 INSOLVENCY. There are no attachments, executions or
assignments for the benefit of creditors, or voluntary or involuntary
proceedings in bankruptcy, or under any other debtor relief laws,
contemplated by or pending or threatened against Operating Partnership.
5.5 BROKERS. Neither Operating Partnership nor the REIT has
employed or dealt with any broker or finder, or incurred any liability
therefor, in connection with the Contributions.
5.6 VALID CONSIDERATION. The Units, when issued in accordance
with this Agreement and the Operating Agreement of Operating Partnership,
shall be duly and validly issued, fully paid and nonassessable, and the
issuance thereof shall not be subject to preemptive or other similar rights.
6. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF CONTRIBUTORS.
Each Contributor, in his, her or its capacity as a partner of the
Partnership, hereby represents and warrants to and agrees with Operating
Partnership with respect to his, her or its Contributed Interests as follows,
which representations and warranties shall be true and correct on the Closing
Date:
6.1 TITLE; AUTHORITY TO ASSIGN. Contributor (i) owns good and
marketable, legal and beneficial title in and to his, her or its Contributed
Interests which are held or by the Closing Date shall be held free of liens,
encumbrances, judgments, adverse interests, pledges and security interests,
other than any such interests in the Contributed Interests granted pursuant
to the Partnership Agreement of the Partnership, (ii) holds the entire right,
title and interest in and to his, her or its Contributed Interests, and (iii)
has the full right, power, capacity and authority to validly contribute and
convey his, her or its Contributed Interests pursuant to this Agreement.
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6.2 NO BREACH OF PARTNERSHIP AGREEMENT. None of the execution and
delivery of this Agreement by Contributor, the consummation by Contributor of
the Contribution or compliance by Contributor with any of the provisions
hereof shall as of the Closing Date conflict with or result in any breach of
any provisions of the Partnership Agreement of the Partnership or any other
agreement to which Contributor is a party.
6.3 INSOLVENCY. There are no attachments, executions or
assignments for the benefit of creditors, or voluntary or involuntary
proceedings in bankruptcy, or under any other debtor relief laws,
contemplated by or pending or, to the knowledge of Contributor, threatened
against Contributor.
6.4 LITIGATION. Contributor has no knowledge of any actual or
pending litigation or proceeding by any organization, person, individual or
governmental agency against Contributor with respect to or against or
potentially affecting his, her or its Contributed Interests.
6.5 BINDING OBLIGATION, ETC. This Agreement has been duly and
validly executed and delivered by Contributor to Operating Partnership and
constitutes a legal, valid and binding agreement of Contributor, enforceable
against Contributor in accordance with its terms, except as such enforcement
may be limited by bankruptcy, conservatorship, receivership, insolvency,
moratorium or similar laws affecting creditors' rights generally and to
general principles of equity. Contributor further represents and warrants
that if Contributor is a corporation, partnership, trust or other entity, it
has the power to, and is duly authorized and otherwise duly qualified to,
purchase and hold securities such as Units and shares of Common Stock and
such entity has its principal place of business as set forth on Exhibit A.
6.6 BROKERS. Contributor has not employed or dealt with any
broker or finder, or incurred any liability therefor, in connection with the
Contribution.
6.7 SECURITIES ACT AND OTHER REPRESENTATIONS AND AGREEMENTS.
(a) (i) Upon the issuance of Units to Contributor,
Contributor shall become subject to, and shall be bound by, the terms and
provisions of the Partnership Agreement of Operating Partnership, including
the terms of the power of attorney contained in Section 15.11 thereof, as the
Partnership Agreement may be amended and restated from time to time in
accordance with its terms.
(ii) Contributor or his, her or its advisor(s) have had a
reasonable opportunity to ask questions of and receive information and
answers from a person or persons acting on behalf of the Partnership
concerning the Consolidation, and, as Contributor may deem necessary, to
verify the information contained in the Memorandum, receipt of which is
acknowledged, and any other information provided to Contributor by the
Partnership or Operating Partnership and all such questions have been
answered and all such information has been provided to the full satisfaction
of Contributor.
(iii) Contributor is acquiring Units for his, her or its
own account as principal, for investment and not with a view to resale or
distribution, that the shares of Common Stock of the REIT which may be
obtained upon redemption of the Units may not be transferred or otherwise
disposed of by Contributor otherwise than in transactions pursuant to the
registration statement required to be filed by the Company with respect to
such shares of Common Stock or that are exempt from the registration
requirements of the Securities Act of 1933 (the "Securities Act") and all
applicable state and foreign securities laws, and that the REIT may refuse to
transfer any
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shares of Common Stock as to which evidence of such registration or
exemptions from such registration satisfactory to the REIT is not provided to
it.
(iv) Contributor has sufficient knowledge and experience
in financial, tax and business matters to enable him, her or it to evaluate
the merits and risks of an investment in the Units. Contributor has the
ability to bear the economic risk of acquiring the Units. Contributor
acknowledges that (1) the transactions contemplated by this Agreement and the
Memorandum involve complex tax consequences for each Contributor and each
Contributor is relying solely on the advice of his, her or its own tax
advisors in evaluating such consequences, and (2) neither Operating
Partnership nor the General Partner has made (or shall be deemed to have
made) any representations or warranties as to the tax consequences of such
transaction to any Contributor. Each Contributor remains solely responsible
for all tax matters relating to each Contributor.
(v) If needed, Contributor has discussed with his, her or
its professional, legal, tax or financial advisors the suitability of an
investment in Units or shares of Common Stock for his, her or its particular
tax and financial situation. Nothing contained herein or in the Memorandum
shall be deemed to imply any representation by Operating Partnership or the
General Partner as to a particular tax effect that may be obtained by any
Contributor. All information that Contributor has provided to Operating
Partnership concerning himself or herself or itself and his, her or its
financial position is correct and complete as of the date hereof, and if
there should be any material change in such information prior to issuance of
Units to the partners, he, she or it shall immediately provide such changed
information to Operating Partnership.
(vi) Contributor has not disclosed any information
contained in the Memorandum to anyone other than his or her spouse or his,
her or its professional, legal, tax or financial advisors advising him, her
or it in connection with this investment and has not reproduced the
Memorandum other than for the use of such advisors.
(b) STATUS AS A UNITED STATES PERSON. (i) Unless otherwise
indicated on the Partner Consent, Contributor certifies that Contributor is
not a foreign person within the meaning of Section 1445 of the Internal
Revenue Code ("Section 1445"). To the extent that Contributor is not a
foreign person within the meaning of Section 1445, (1) Contributor's U.S.
taxpayer identification number that has previously been provided to the
Partnership is accurate, (2) Contributor's home address (in the case of an
individual) or office address (in the case of an entity) is that address
indicated on Exhibit A of this Agreement and (3) if Contributor subsequently
becomes a foreign person within the meaning of Section 1445, Contributor
shall notify Operating Partnership within sixty (60) days of doing so.
(ii) If Contributor is a foreign person within the
meaning of Section 1445, Operating Partnership shall withhold ten percent
(10%) of the amount realized (as such term is defined in Section 1001 of the
Internal Revenue Code) by Contributor in connection with the Contribution,
unless Operating Partnership shall receives from Contributor a notice of
nonrecognition transfer with respect to the Contribution by Contributor (in a
form to be provided by Operating Partnership).
(c) INDEMNIFICATION. Contributor hereby agrees to indemnify
and hold harmless the Partnership, the REIT, Operating Partnership and the
General Partner and any of the employees, agents, officers, directors and
affiliated persons of the foregoing from any and all damages, losses, costs
and expenses (including reasonable attorneys' fees) which they, or any of
them, may incur by reason of a failure by Contributor to fulfill any of the
terms and conditions of
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this Agreement or by reason of the breach by Contributor of any of the
representations and warranties contained herein.
(d) WAIVER AND CONTRIBUTION. Contributor understands that (i)
the Units to be issued pursuant to the Consolidation have not been registered
under the Securities Act and (ii) the failure to register such Units could
result in Contributor being granted certain rights under the Federal
securities laws, including a right to rescind Contributor's consent to the
Consolidation. For the benefit of Operating Partnership, and in
consideration of Operating Partnership's consummating the Consolidation,
Contributor (x) hereby waives any and all rights he or she now has or may
hereafter be granted to rescind his or her consent to the Consolidation on
the basis that the Units issued in connection with the Consolidation were not
registered (the "Waiver") and (y) agrees that if the Waiver is deemed void or
unenforceable for any reason, including, without limitation, under Section 14
of the Securities Act, the entire beneficial interest in all property and
amounts received by Contributor in any action to rescind the Consolidation
(regardless of whether such action was initiated by Contributor) or otherwise
received by Contributor as damages for failure to register the Units under
the Securities Act, shall be promptly paid over and contributed by
Contributor to Operating Partnership, for no additional consideration from
Operating Partnership, other than the Units originally issued pursuant to the
Consolidation.
Whenever the context shall require, all words in the male, female or
neuter gender shall be deemed to include the other genders, all singular
words shall include the plural, and all plural words shall include the
singular. All representations, covenants and agreements of Contributor set
forth in this Agreement shall survive the consummation of the Consolidation
contemplated by the Memorandum.
7. CONDITIONS TO COMPLETION. In addition to the conditions to
completion of the Consolidation set forth in the Memorandum, the obligations
of Operating Partnership to consummate the transactions contemplated by this
Agreement shall be subject to fulfillment (or waiver by Operating
Partnership) at or prior to the Closing of the following conditions:
7.1 REPRESENTATIONS, WARRANTIES AND COVENANTS. The
representations, warranties and covenants made by Contributors in this
Agreement or in any document delivered by any of them pursuant to this
Agreement shall be true and correct in all material respects when made and on
and as of the Closing as though such representations, warranties and
covenants were made on and as of such date.
7.2 ACTIONS AFFECTING CONTRIBUTED INTERESTS. Contributors shall
not have sold, assigned, leased, pledged, transferred or encumbered any of
the Contributed Interests, or entered into any other consent, commitment,
understanding or other agreement, or have incurred any material obligation or
liability (contingent or absolute) with respect to the Contributed Interests.
7.3 NO MATERIAL ADVERSE CHANGE. There shall have been no material
adverse change in the value or condition of the Partnership or the Property
since the date hereof, except for changes resulting from the operation of the
Partnership in the ordinary course of business consistent with past practice
or as otherwise contemplated by the Memorandum, in each case that do not have
a material adverse effect on the business or financial condition of the
Partnership.
7.4 CONSENTS. Any and all consents required by the Partnership
Agreement of the Partnership, and any certificates, agreements, contribution
and assumption instruments and other documents necessary or advisable to
evidence the conveyance of the Contributed Interests and
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the admission of Operating Partnership (or Designated Subsidiary) into the
Partnership by virtue of the contribution of the Contributed Interests, shall
have been obtained.
7.5 NO ORDER OR INJUNCTION. The consummation of the Contributions
shall not have been restrained, enjoined or prohibited by any order or
injunction of any court or governmental authority of competent jurisdiction.
7.6 CONSOLIDATION. In addition to the consents set forth in
Section 7.4 above, all conditions to the closing of the Consolidation set
forth in the underwriting agreement with respect to the Offering shall have
been satisfied on terms satisfactory to Operating Partnership and the General
Partner.
8. THE CLOSING.
8.1 CONTRIBUTORS' CLOSING DOCUMENTS. At Closing, each Contributor
shall deliver (or cause to be delivered pursuant to the Power of Attorney
referred to in Section 11.9) or the General Partner shall deliver the
following (all of which shall be duly executed and acknowledged where
required):
(a) A written document of conveyance contributing to Operating
Partnership (and/or any Designated Subsidiary) title to Contributor's
Contributed Interests, free and clear of any adverse claim or interest;
(b) Such documents and certificates as Operating Partnership
reasonably may require to establish the authority of the parties executing
any documents in connection with the Contributions;
(c) Such consents and instruments of admission as contemplated
by Section 7.4 hereof; and
(d) Such other documents, instruments and certificates as
Operating Partnership and the General Partner, as agent for the Contributors,
reasonably agree are necessary or appropriate, including without limitation
recording and transfer forms and affidavits.
8.2 OPERATING PARTNERSHIP'S CLOSING DOCUMENTS. At Closing,
Operating Partnership shall deliver or cause to be delivered to the General
Partner, as agent for the Contributors, the following:
(a) The Units; and
(b) Such other documents and instruments as the General
Partner, as agent for the Contributors, and Operating Partnership agree are
necessary or appropriate, including without limitation recording and transfer
forms and affidavits.
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9. TRANSFER TAXES AND CLOSING COSTS.
(a) The General Partner and Operating Partnership shall join
on the Closing Date in completing, executing, delivering and verifying the
returns, affidavits and other documents required in connection with the
documentary stamps in accordance with the New York State Real Estate Transfer
Tax imposed by Article 31 of the Tax Law, the New York City Real Property
Transfer Tax imposed by Title II of Chapter 46 of the Administrative Code of
the City of New York, and any other tax payable by reason of the contribution
of the Contributed Interests (collectively, the "Conveyance Taxes").
(b) The Contributors hereby agree to pay and shall be solely
responsible for the Conveyance Taxes due on the conveyance of the Contributed
Interests. Using the amount distributed to the General Partner pursuant to
Section 2(b) hereof, the General Partner, as agent for the Contributors,
shall timely pay to the appropriate tax collecting agency or official the
amount of all Conveyance Taxes payable by reason of the Contributors'
agreement to pay the Conveyance Taxes. The Contributors shall indemnify,
defend and hold harmless Operating Partnership and the Partnership from and
against all claims, liabilities, costs and expenses (including reasonable
attorney's fees), incurred by Operating Partnership or the Partnership by
reason of the failure of the Contributors to pay any Conveyance Taxes
assessed or alleged to be due at any time with respect to the transfer of the
Interests to Operating Partnership, including, without limitation, all
interest and penalties thereon.
(c) Operating Partnership shall also pay or provide for the
payment of all other costs associated with the closing of the acquisition of
the Contributed Interests pursuant to this Agreement, as described in the
Memorandum.
10. OPERATION IN THE ORDINARY COURSE. The General Partner shall
use reasonable efforts to operate the Partnership and the Property in the
ordinary course of business between the date hereof and the closing of the
Consolidation, including making any necessary capital expenditures and
leasing expenditures consistent with past practices to maintain the quality
and value of the Property.
11. GENERAL PROVISIONS.
11.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. It is the express
intention and agreement of the parties hereto that the representations and
warranties of the parties set forth in this Agreement shall survive the
consummation of the Contributions and the Closing.
11.2 NOTICES. All notices, demands, requests or other
communications that may be or are required to be given or made by any party
to the other parties pursuant to this Agreement shall be in writing and shall
be hand delivered or transmitted by certified mail, express overnight mail or
delivery service, telegram, telex or facsimile transmission to the parties at
the addresses specified in Exhibit A or such other address as the addressee
may indicate by written notice to the other party.
Each notice, demand, request or communication that is given or made
in the manner described above shall be deemed sufficiently given or made for
all purposes at such time as it is delivered to the addressee (with the
delivery receipt, the affidavit of messenger or (with respect to a telex) the
answer back being deemed conclusive but not exclusive evidence of such
delivery) or at such time as delivery is refused by the addressee upon
presentation.
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11.3 GOVERNING LAW. This Agreement, the rights and obligations of
the parties hereto and any claims or disputes relating to such rights and
obligations shall be governed by and construed under the laws of the State of
New York.
11.4 HEADINGS. Section and subsection headings contained in this
Agreement are inserted for convenience of reference only, shall not be deemed
to be a part of this Agreement for any purpose, and shall not in any way
define or affect the meaning, construction or scope of any of the provisions
hereof.
11.5 BENEFIT AND ASSIGNMENT. No Contributor shall assign this
Agreement, in whole or in part, whether by operation of law or otherwise,
without the prior written consent of Operating Partnership. Any purported
assignment contrary to the terms hereof shall be null, void and of no force
and effect.
This Agreement shall be binding upon and shall inure to the benefit
of the parties hereto and their respective successors and assigns as
permitted hereunder. No person or entity other than the parties hereto is or
shall be entitled to bring any action to enforce any provision of this
Agreement against any of the parties hereto, and the covenants and agreements
set forth in this Agreement shall be solely for the benefit of, and shall be
enforceable only by, the parties hereto or their respective successors and
assigns as permitted hereunder.
The Operating Partnership may designate one or more Designated
Subsidiaries to acquire all or any part of the Contributed Interests (in
which case the Designated Subsidiary shall execute a certificate at closing
making the same representations and warranties as are made by Operating
Partnership and references to Operating Partnership shall include the
Designated Subsidiaries except where the context clearly indicates otherwise).
11.6 SEVERABILITY. If any part of any provision of this Agreement
or any other agreement, document or writing given pursuant to or in
connection with this Agreement shall be invalid or unenforceable under
applicable law, such part shall be ineffective to the extent of such
invalidity or unenforceability only, without in any way affecting the
remaining parts of such provisions or the remaining provisions of said
agreement so long as the economic and legal substance of the Contributions is
not affected in any manner materially adverse to either party.
11.7 ENTIRE AGREEMENT; AMENDMENT. The Schedules and the Exhibits
attached hereto are hereby incorporated into the Agreement as if fully set
forth herein. This Agreement, and the Schedules and Exhibits attached hereto
(each of which shall be deemed incorporated herein and made a part hereof),
together with the Memorandum, contain the final and entire agreement between
the parties hereto with respect to the Contributions, supersede all prior
oral and written memoranda and agreements with respect to the matters
contemplated herein, and are intended to be an integration of all prior
negotiations and understandings. Contributors and Operating Partnership
shall not be bound by any terms, conditions, statements, warranties or
representations, oral or written, not contained or referred to herein or
therein. No change or modification of this Agreement shall be valid unless
the same is in writing and signed by the parties hereto.
11.8 NO WAIVER. No delay or failure on the part of any party hereto
in exercising any right, power or privilege under this Agreement or under any
other instrument or document given in connection with or pursuant to this
Agreement shall impair any such right, power or privilege or be construed as
a waiver of any default or any acquiescence therein. No single or partial
exercise of any such right, power or privilege shall preclude the further
exercise of such right, power or privilege. No waiver shall be valid against
any party hereto unless made in writing
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and signed by the party against whom enforcement of such waiver is sought and
then only to the extent expressly specified therein.
11.9 CONSENT AND POWER OF ATTORNEY. The General Partner hereby
consents to the contribution of the Contributed Interests pursuant hereto by
each of the Contributors. Each Contributor is executing a Partner Consent
pursuant to which such Contributor (a) is executing this Agreement and (b) is
consenting to each matter set forth therein. In addition, by executing this
Agreement pursuant to the Consent, each Contributor is constituting and
appointing each of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇▇▇▇ ▇.
▇▇▇▇, individually, with full power of substitution, the true and lawful
attorney-in-fact (the "Attorney") of such Contributor, with full power and
authority in the name of and for and on behalf of such Contributor, to
execute an instrument of conveyance contributing his, her or its Contributed
Interests to Operating Partnership pursuant to the Consolidation on the terms
set forth in the Memorandum, to execute the Partnership Agreement of
Operating Partnership and the Registration Rights Agreement (as such term is
defined in the Memorandum) and to execute any instruments required to be
filed in connection with the Conveyance Taxes, and to execute any other
instruments that the General Partner reasonably determines necessary or
appropriate in connection with the contribution of the Interests pursuant to
this Agreement.
Each Contributor shall promptly notify the General Partner if any of
the representations and warranties by that partner were not true and correct
when made or become untrue at any time prior to the Closing.
IN WITNESS WHEREOF, each of the Contributors has executed a separate
Partner Consent agreeing to be bound by the terms of the Agreement and each
of Operating Partnership, and the General Partner has caused this Agreement
to be duly executed and delivered on its or his behalf as of the date first
above written.
THE MENDIK COMPANY, L.P.
By: Mendik Group, Inc.
By:
--------------------------------
Name:
Title:
--------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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AGREEMENT FOR CONTRIBUTION OF INTERESTS
[866 U.N. PLAZA]
THIS AGREEMENT for the Contribution of Interests (this "Agreement")
is made and entered into as of _____________, 1996, by and among The Mendik
Company, L.P. ("Operating Partnership"), a Delaware limited partnership,
whose managing general partner is Mendik Group, Inc. (the "REIT"), a Delaware
corporation, each of the parties listed on Exhibit A annexed hereto who
executes a Partner Consent (hereinafter defined) agreeing to become a party
to this Agreement (collectively referred to herein as "Contributors") and
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ (in his capacity as a managing member of the Company
(hereinafter defined), the "Managing Member").
WHEREAS, it is desired to consolidate (the "Consolidation")
interests in up to seven general or limited partnerships or limited liability
companies of which the Managing Member or an affiliate is a general partner,
together with the assets of Mendik Realty Company, Inc. and Mendik Management
Company, Inc., each a New York corporation and affiliate of the Managing
Member, with and into Operating Partnership and to effect the initial public
offering (the "Offering") of shares of common stock of the REIT ("Common
Stock").
WHEREAS, prior to the Consolidation, the REIT shall merge into The
Mendik Company, Inc., a Maryland corporation, and from and after such merger,
all references herein to the REIT shall refer to The Mendik Company, Inc.
WHEREAS, Contributors are owners of interests (the "Contributed
Interests") in 866 U.N. Plaza Associates LLC, a New York limited liability
company (the "Company"), which Company owns land and improvements (the
"Property") known as ▇▇▇ ▇.▇. ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇;
WHEREAS, in connection with the consummation of the Consolidation
and the Offering, the parties hereto desire that Operating Partnership and,
if designated by Operating Partnership, one or more special purpose
subsidiary partnerships or limited liability companies of Operating
Partnership or one or more other entities controlled by Operating Partnership
(each a "Designated Subsidiary") acquire all of the interests in the Company
through the contribution of such interests to Operating Partnership and/or
one or more Designated Subsidiaries upon the terms and conditions provided
herein; and
WHEREAS, if the holders of all of the interests in the Company do
not execute the Partner Consent annexed to and made a part of the Memorandum
(the "Partner Consent"), it is contemplated that Operating Partnership may
attempt to effect the Consolidation in another manner, through a transfer of
the Property to Operating Partnership (or a Designated Subsidiary) or merger
of the Company with Operating Partnership (or a Designated Subsidiary) or
other means.
NOW, THEREFORE, in consideration of the foregoing and the mutual
promises and covenants set forth herein, Operating Partnership, Contributors
and the Managing Member hereby agree as follows:
1. CONTRIBUTIONS. Upon the Closing (hereinafter defined), and
subject to the satisfaction or waiver by Operating Partnership of the
conditions set forth in Section 7 of this Agreement, Contributors shall
contribute, convey and assign to Operating Partnership (and/or Designated
Subsidiary) and Operating Partnership (and/or Designated Subsidiary) shall
acquire from Contributors all of Contributors' right, title and interest in
the Contributed Interests (the "Contributions"), including, without
limitation, all of Contributors' interest in the profits, losses, property
and capital of the Company allocable to the Contributed Interests, and for
each
Contributor who receives additional Units pursuant to Section 2(f) hereof,
the cash distribution to that Contributor pursuant to the first sentence of
Section 2(e) hereof, upon the terms and conditions set forth in this
Agreement.
2. CONSIDERATION; DISTRIBUTIONS PRIOR TO CLOSING.
(a) In full consideration for the contribution of the
Contributed Interests, Operating Partnership shall deliver to Contributors at
the Closing, (i) with respect to the Property Value (as such term is defined
in the Memorandum), units of limited partnership interests ("Units") in
Operating Partnership determined in accordance with the methodology described
in the Confidential Solicitation of Consents and Private Placement Memorandum
(the "Memorandum") dated November 11, 1996, and (ii) additional Units as
determined in accordance with Section 2(b) hereof.
(b) If the sum of (i) the aggregate amount of the Net Other
Assets (hereinafter defined) of the Company as of the close of business on
the day preceding the date of the Closing (the "Closing Date"), plus (ii) the
amount distributed pursuant to the first sentence of Section 2(e) hereof,
plus (iii) 7% of the Cash Amount (as defined in Section 2(e) hereof) exceeds
$9,250,000, Operating Partnership may elect to include all or any portion of
such excess Net Other Assets (the "Included Excess Net Other Assets") in the
transaction and issue Units (valued at the Final Offering Price (as such term
is defined in the Memorandum) of the shares of Common Stock in the Offering)
with a value equal to the amount of the Included Excess Net Other Assets; on
the Closing Date, immediately prior to the Closing, the Managing Member shall
cause the Company to distribute to its members an amount equal to any Net
Other Assets which are in excess of $9,250,000 plus the Included Excess Net
Other Assets.
If the sum of (i) the aggregate amount of the Net Other
Assets of the Company as of the close of business on the day preceding the
Closing Date, plus (ii) the amount distributed pursuant to the first sentence
of Section 2(e) hereof, plus (iii) 7% of the Cash Amount (as defined in
Section 2(e) hereof) is less than $9,250,000, Operating Partnership may
terminate this Agreement by notice to Contributors.
As used in this Agreement, the following terms have the
following meanings:
(i) "Net Other Assets" means the excess of Certain Other
Assets over Certain Other Liabilities (as such terms are hereinafter defined).
(ii) "Certain Other Assets" means cash and cash
equivalents (excluding 7% of the Cash Amount (as defined in Section 2(e)
hereof)), marketable securities, accounts receivable (including any rent
escalations payable with respect to the period through the Closing Date, but
excluding any receivables with respect to any period after the month in which
the Closing occurs, as well as any amount payable after the month in which
the Closing occurs to the extent such amount has been recognized as income
prior to the Closing), prepaid expenses (excluding any prepaid leasing costs
relating to leases entered into prior to October 1, 1996), escrow deposits
made by the Company, capital expenditures (other than tenant improvements or
building improvements required by the terms of any lease and other than those
committed capital expenditures listed on Exhibit B annexed hereto) made on or
after October 1, 1996, amounts paid for leasing costs, tenant and building
improvements or tenant acquisition costs relating to (1) leases entered into
on or after October 1, 1996 and (2) leases entered into prior to October 1,
1996, but only to the extent of any leasing expenditures with respect to such
leases entered into prior to October 1, 1996 which are set forth on Exhibit C
annexed hereto. For the purpose of calculating Certain Other
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Assets, the accounts receivable of the Company shall be valued at the face
amount of the accounts receivable, net of a reserve for doubtful accounts
determined in accordance with generally accepted accounting principles
consistently applied (but without giving effect to the straight line
requirement of FASB 13).
(iii) "Certain Other Liabilities" means accounts payable,
accrued interest payable and other accrued liabilities (including any
liability or obligation for leasing costs, tenant or building improvements or
tenant acquisition costs payable relating to leases entered into prior to
October 1, 1996 but excluding any liability or obligation for leasing costs,
tenant or building improvements or tenant acquisition costs payable relating
to (1) leases entered into on or after October 1, 1996 and (2) leases entered
into prior to October 1, 1996, but only to the extent of any leasing
expenditures with respect to such leases entered into prior to October 1,
1996 which are set forth on Exhibit C annexed hereto), the unpaid remaining
cost of any committed capital expenditures listed on Exhibit B annexed hereto
and prepaid rent received from tenants.
For purposes of this Section 2, the exercise of an option
to renew a lease or to rent additional space pursuant to a lease shall be
deemed a new lease entered into on the date the renewal option is exercised
or the additional space is leased.
(c) The Managing Member shall prepare and submit to Operating
Partnership, not later than five days prior to the Closing Date, its best,
good faith estimate of the Net Other Assets as of the close of business on
the day preceding the Closing Date; such estimate shall be determined based
upon the books and records of the Company. The estimate submitted to
Operating Partnership shall be accompanied by (i) a statement setting forth
in reasonable detail the calculation of the estimated Net Other Assets as of
the close of business on the day preceding the Closing Date, and (ii) a
certificate signed by the Managing Member confirming that the estimate was
calculated in accordance with the terms of this Section 2. The estimate
shall be final and binding on the parties unless, at least two days prior to
the Closing, Operating Partnership gives written notice to the Managing
Member that it objects to any item. The Operating Partnership and the
Managing Member shall immediately consult with respect to any item objected
to and their joint determination with respect to any items in dispute shall
be final and binding on the parties. The number of additional Units to be
delivered at Closing shall be based on the statement of Net Other Assets
delivered by the Managing Member (or the undisputed amount of Net Other
Assets) and the amount of Included Excess Net Other Assets based thereon. If
Operating Partnership and the Managing Member are unable to reach agreement
on the amount of Net Other Assets prior to Closing, within ten days after the
Closing, the dispute shall be referred to and resolved by a "Big 6" firm of
independent certified public accountants proposed by Operating Partnership
and reasonably acceptable to the Managing Member, and the determination by
that accounting firm shall be final and binding on the parties. Promptly
after that determination, Operating Partnership shall deliver to the Managing
Member, as agent for the Contributors, any additional Units payable as a
result of the determination. The fees and expenses of the accounting firm
shall be borne by Operating Partnership.
(d) Any amounts collected by Operating Partnership after the
Closing Date relating to the period through the Closing Date with respect to
refunds of real estate taxes (less any costs incurred by Operating
Partnership in obtaining such refunds and less any portion of such refunds
required to be paid to tenants) shall be promptly paid to the Managing
Member, as agent for the Contributors, not later than 10 days after the end
of the month in which such amounts are collected.
(e) As of the close of business on the day preceding the
Closing, the Managing Member shall cause the Company to distribute to its
members 93% of the Cash Amount
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(as defined below), up to a maximum distribution of $7,440,000, provided that
no such distribution shall reduce the Net Other Assets at Closing below
$1,250,000. On the Closing Date, the Managing Member shall cause the Company
to distribute to the Managing Member, as agent for the members, approximately
$750,000 to pay the Conveyance Taxes (hereinafter defined) payable by them
pursuant to Section 9(b) hereof, but such amount shall be deducted prior to
the calculation of Net Other Assets. "Cash Amount" means the amount of cash
of the Company as of the close of business on the day preceding the Closing
(in excess of the $750,000 referred to in the preceding sentence), up to a
maximum amount of $8,000,000, but excluding any cash that cannot be
distributed pursuant to the proviso to the first sentence of this Section
2(e).
(f) At the Closing, each Contributor who does not elect on the
Partner Consent to retain the cash distribution to be made pursuant to the
first sentence of Section 2(e) hereof shall exchange all or any portion of
the cash so distributed to the Contributor for additional Units (valued at
93% of the Final Offering Price of the shares of Common Stock in the
Offering).
3. ACCEPTANCE OF CONTRIBUTIONS. Operating Partnership hereby
agrees that at the Closing it shall accept the Contributions and shall assume
any and all rights, obligations and responsibilities of Contributors as
owners of the Contributed Interests that arise from and after the Closing
Date.
4. CLOSING TIME AND PLACE. Unless another date or place is agreed
to by the parties, the closing of the Contributions (the "Closing") shall
take place contemporaneously with the closing of the Consolidation and the
Offering at the offices of Proskauer ▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇ LLP, ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or such other place and time as Operating
Partnership and the Managing Member shall agree upon, upon the satisfaction
or waiver of all conditions to the Closing set forth in Section 7 hereof.
5. REPRESENTATIONS AND WARRANTIES OF OPERATING PARTNERSHIP.
Operating Partnership hereby represents and warrants to Contributors as
follows, which representations and warranties shall be true and correct on
the Closing Date:
5.1 ORGANIZATION, POWER AND AUTHORITY, AND QUALIFICATION. Operating
Partnership is a limited partnership duly organized, validly existing and in
good standing under the laws of the State of Delaware. The REIT is a
corporation duly organized, validly existing and in good standing under the
laws of its state of incorporation. Each of Operating Partnership and the
REIT has the requisite power and authority to carry on its respective
business as it is now being conducted. Each of Operating Partnership and the
REIT is qualified to do business and is in good standing in each jurisdiction
in which the character of its property owned or leased or the nature of its
activities makes such qualification necessary, except where the failure to be
so qualified and in good standing would not have a material adverse effect on
the business or financial condition of Operating Partnership or the REIT, as
the case may be.
5.2 AUTHORITY RELATIVE TO THIS AGREEMENT. Operating Partnership
has taken all action necessary to authorize the execution, delivery and
performance of this Agreement by Operating Partnership and no other
proceedings on the part of Operating Partnership are necessary to authorize
the execution and delivery of this Agreement and the consummation of the
Contributions.
None of the execution and delivery of this Agreement by Operating
Partnership, the consummation by Operating Partnership of the Contributions
or compliance by Operating Partnership with any of the provisions hereof
shall (i) conflict with or result in any breach of any provisions of the
Partnership Agreement of Operating Partnership; (ii) result in a violation or
4
breach of, or constitute (with or without due notice or lapse of time or
both) a default (or give rise to any right of termination, cancellation or
acceleration) under any of the terms, conditions or provisions of any note,
bond, mortgage, indenture, lease, license, contract, agreement or other
instrument or obligation to which Operating Partnership is a party or by
which it or any of its properties or assets may be bound; or (iii) violate
any order, writ, injunction, decree, statute, rule or regulation applicable
to Operating Partnership; except in the case of (ii) or (iii) for violations,
breaches, or defaults (A) that would not in the aggregate have a material
adverse effect on the business or financial condition of Operating
Partnership or the REIT, and that shall not impair the effectiveness of the
Contributions contemplated hereby, or (B) for which waivers or consents have
been or shall be obtained prior to the Closing Date.
5.3 BINDING OBLIGATION. This Agreement has been duly and validly
executed and delivered by Operating Partnership and constitutes a valid and
binding agreement of Operating Partnership, enforceable against Operating
Partnership in accordance with its terms, except that such enforcement may be
subject to bankruptcy, conservatorship, receivership, insolvency, moratorium,
or similar laws affecting creditors' rights generally or the rights of
creditors of limited partnerships and to general principles of equity.
5.4 INSOLVENCY. There are no attachments, executions or
assignments for the benefit of creditors, or voluntary or involuntary
proceedings in bankruptcy, or under any other debtor relief laws,
contemplated by or pending or threatened against Operating Partnership.
5.5 BROKERS. Neither Operating Partnership nor the REIT has
employed or dealt with any broker or finder, or incurred any liability
therefor, in connection with the Contributions.
5.6 VALID CONSIDERATION. The Units, when issued in accordance with
this Agreement and the Operating Agreement of Operating Partnership, shall be
duly and validly issued, fully paid and nonassessable, and the issuance
thereof shall not be subject to preemptive or other similar rights.
6. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF CONTRIBUTORS.
Each Contributor, in his, her or its capacity as a partner of the Company,
hereby represents and warrants to and agrees with Operating Partnership with
respect to his, her or its Contributed Interests as follows, which
representations and warranties shall be true and correct on the Closing Date:
6.1 TITLE; AUTHORITY TO ASSIGN. Contributor (i) owns good and
marketable, legal and beneficial title in and to his, her or its Contributed
Interests which are held or by the Closing Date shall be held free of liens,
encumbrances, judgments, adverse interests, pledges and security interests,
other than any such interests in the Contributed Interests granted pursuant
to the Operating Agreement of the Company, (ii) holds the entire right, title
and interest in and to his, her or its Contributed Interests, and (iii) has
the full right, power, capacity and authority to validly contribute and
convey his, her or its Contributed Interests pursuant to this Agreement.
6.2 NO BREACH OF OPERATING AGREEMENT. None of the execution and
delivery of this Agreement by Contributor, the consummation by Contributor of
the Contribution or compliance by Contributor with any of the provisions
hereof shall as of the Closing Date conflict with or result in any breach of
any provisions of the Operating Agreement of the Company or any other
agreement to which Contributor is a party.
5
6.3 INSOLVENCY. There are no attachments, executions or
assignments for the benefit of creditors, or voluntary or involuntary
proceedings in bankruptcy, or under any other debtor relief laws,
contemplated by or pending or, to the knowledge of Contributor, threatened
against Contributor.
6.4 LITIGATION. Contributor has no knowledge of any actual or
pending litigation or proceeding by any organization, person, individual or
governmental agency against Contributor with respect to or against or
potentially affecting his, her or its Contributed Interests.
6.5 BINDING OBLIGATION, ETC. This Agreement has been duly and
validly executed and delivered by Contributor to Operating Partnership and
constitutes a legal, valid and binding agreement of Contributor, enforceable
against Contributor in accordance with its terms, except as such enforcement
may be limited by bankruptcy, conservatorship, receivership, insolvency,
moratorium or similar laws affecting creditors' rights generally and to
general principles of equity. Contributor further represents and warrants
that if Contributor is a corporation, partnership, trust or other entity, it
has the power to, and is duly authorized and otherwise duly qualified to,
purchase and hold securities such as Units and shares of Common Stock and
such entity has its principal place of business as set forth on Exhibit A.
6.6 BROKERS. Contributor has not employed or dealt with any broker
or finder, or incurred any liability therefor, in connection with the
Contribution.
6.7 SECURITIES ACT AND OTHER REPRESENTATIONS AND AGREEMENTS.
(a) (i) Upon the issuance of Units to Contributor,
Contributor shall become subject to, and shall be bound by, the terms and
provisions of the Partnership Agreement of Operating Partnership, including
the terms of the power of attorney contained in Section 15.11 thereof, as the
Partnership Agreement may be amended and restated from time to time in
accordance with its terms.
(ii) Contributor or his, her or its advisor(s) have had a
reasonable opportunity to ask questions of and receive information and
answers from a person or persons acting on behalf of the Company concerning
the Consolidation, and, as Contributor may deem necessary, to verify the
information contained in the Memorandum, receipt of which is acknowledged,
and any other information provided to Contributor by the Company or Operating
Partnership and all such questions have been answered and all such
information has been provided to the full satisfaction of Contributor.
(iii) Contributor is acquiring Units for his, her or its
own account as principal, for investment and not with a view to resale or
distribution, that the shares of Common Stock of the REIT which may be
obtained upon redemption of the Units may not be transferred or otherwise
disposed of by Contributor otherwise than in transactions pursuant to the
registration statement required to be filed by the Company with respect to
such shares of Common Stock or that are exempt from the registration
requirements of the Securities Act of 1933 (the "Securities Act") and all
applicable state and foreign securities laws, and that the REIT may refuse to
transfer any shares of Common Stock as to which evidence of such registration
or exemptions from such registration satisfactory to the REIT is not provided
to it.
(iv) Contributor has sufficient knowledge and experience
in financial, tax and business matters to enable him, her or it to evaluate
the merits and risks of an investment in the Units. Contributor has the
ability to bear the economic risk of acquiring the Units. Contributor
acknowledges that (1) the transactions contemplated by this Agreement and the
6
Memorandum involve complex tax consequences for each Contributor and each
Contributor is relying solely on the advice of his, her or its own tax
advisors in evaluating such consequences, and (2) neither Operating
Partnership nor the Managing Member has made (or shall be deemed to have
made) any representations or warranties as to the tax consequences of such
transaction to any Contributor. Each Contributor remains solely responsible
for all tax matters relating to each Contributor.
(v) If needed, Contributor has discussed with his, her or
its professional, legal, tax or financial advisors the suitability of an
investment in Units or shares of Common Stock for his, her or its particular
tax and financial situation. Nothing contained herein or in the Memorandum
shall be deemed to imply any representation by Operating Partnership or the
Managing Member as to a particular tax effect that may be obtained by any
Contributor. All information that Contributor has provided to Operating
Partnership concerning himself or herself or itself and his, her or its
financial position is correct and complete as of the date hereof, and if
there should be any material change in such information prior to issuance of
Units to the partners, he, she or it shall immediately provide such changed
information to Operating Partnership.
(vi) Contributor has not disclosed any information
contained in the Memorandum to anyone other than his or her spouse or his,
her or its professional, legal, tax or financial advisors advising him, her
or it in connection with this investment and has not reproduced the
Memorandum other than for the use of such advisors.
(b) STATUS AS A UNITED STATES PERSON. (i) Unless otherwise
indicated on the Partner Consent, Contributor certifies that Contributor is
not a foreign person within the meaning of Section 1445 of the Internal
Revenue Code ("Section 1445"). To the extent that Contributor is not a
foreign person within the meaning of Section 1445, (1) Contributor's U.S.
taxpayer identification number that has previously been provided to the
Partnership is accurate, (2) Contributor's home address (in the case of an
individual) or office address (in the case of an entity) is that address
indicated on Exhibit A of this Agreement and (3) if Contributor subsequently
becomes a foreign person within the meaning of Section 1445, Contributor
shall notify Operating Partnership within sixty (60) days of doing so.
(ii) If Contributor is a foreign person within the
meaning of Section 1445, Operating Partnership shall withhold ten percent
(10%) of the amount realized (as such term is defined in Section 1001 of the
Internal Revenue Code) by Contributor in connection with the Contributions,
unless Operating Partnership shall receives from Contributor a notice of
nonrecognition transfer with respect to the Contributions by Contributor (in
a form to be provided by Operating Partnership).
(c) INDEMNIFICATION. Contributor hereby agrees to indemnify
and hold harmless the Company, the REIT, Operating Partnership and the
Managing Member and any of the employees, agents, officers, directors and
affiliated persons of the foregoing from any and all damages, losses, costs
and expenses (including reasonable attorneys' fees) which they, or any of
them, may incur by reason of a failure by Contributor to fulfill any of the
terms and conditions of this Agreement or by reason of the breach by
Contributor of any of the representations and warranties contained herein.
(d) WAIVER AND CONTRIBUTION. Contributor understands that (i)
the Units to be issued pursuant to the Consolidation have not been registered
under the Securities Act and (ii) the failure to register such Units could
result in Contributor being granted certain rights under the Federal
securities laws, including a right to rescind Contributor's consent to the
Consolidation. For the benefit of Operating Partnership, and in
consideration of Operating Partnership's
7
consummating the Consolidation, Contributor (x) hereby waives any and all
rights he or she now has or may hereafter be granted to rescind his or her
consent to the Consolidation on the basis that the Units issued in connection
with the Consolidation were not registered (the "Waiver") and (y) agrees that
if the Waiver is deemed void or unenforceable for any reason, including,
without limitation, under Section 14 of the Securities Act, the entire
beneficial interest in all property and amounts received by Contributor in
any action to rescind the Consolidation (regardless of whether such action
was initiated by Contributor) or otherwise received by Contributor as damages
for failure to register the Units under the Securities Act, shall be promptly
paid over and contributed by Contributor to Operating Partnership, for no
additional consideration from Operating Partnership, other than the Units
originally issued pursuant to the Consolidation.
Whenever the context shall require, all words in the male, female or
neuter gender shall be deemed to include the other genders, all singular
words shall include the plural, and all plural words shall include the
singular. All representations, covenants and agreements of Contributor set
forth in this Agreement shall survive the consummation of the Consolidation
contemplated by the Memorandum.
7. CONDITIONS TO COMPLETION. In addition to the conditions to
completion of the Consolidation set forth in the Memorandum, the obligations
of Operating Partnership to consummate the transactions contemplated by this
Agreement shall be subject to fulfillment (or waiver by Operating
Partnership) at or prior to the Closing of the following conditions:
7.1 REPRESENTATIONS, WARRANTIES AND COVENANTS. The
representations, warranties and covenants made by Contributors in this
Agreement or in any document delivered by any of them pursuant to this
Agreement shall be true and correct in all material respects when made and on
and as of the Closing as though such representations, warranties and
covenants were made on and as of such date.
7.2 ACTIONS AFFECTING CONTRIBUTED INTERESTS. Contributors shall
not have sold, assigned, leased, pledged, transferred or encumbered any of
the Contributed Interests, or entered into any other consent, commitment,
understanding or other agreement, or have incurred any material obligation or
liability (contingent or absolute) with respect to the Contributed Interests.
7.3 NO MATERIAL ADVERSE CHANGE. There shall have been no material
adverse change in the value or condition of the Company or the Property since
the date hereof, except for changes resulting from the operation of the
Company in the ordinary course of business consistent with past practice or
as otherwise contemplated by the Memorandum, in each case that do not have a
material adverse effect on the business or financial condition of the Company.
7.4 CONSENTS. Any and all consents required by the Operating
Agreement of the Company, and any certificates, agreements, contribution and
assumption instruments and other documents necessary or advisable to evidence
the conveyance of the Contributed Interests and the admission of Operating
Partnership (or Designated Subsidiary) into the Company by virtue of the
contribution of the Contributed Interests, shall have been obtained.
7.5 NO ORDER OR INJUNCTION. The consummation of the Contributions
shall not have been restrained, enjoined or prohibited by any order or
injunction of any court or governmental authority of competent jurisdiction.
7.6 CONSOLIDATION. In addition to the consents set forth in
Section 7.4 above, all conditions to the closing of the Consolidation set
forth in the underwriting agreement with
8
respect to the Offering shall have been satisfied on terms satisfactory to
Operating Partnership and the Managing Member.
8. THE CLOSING.
8.1 CONTRIBUTORS' CLOSING DOCUMENTS. At Closing, each Contributor
shall deliver (or cause to be delivered pursuant to the Power of Attorney
referred to in Section 11.9) or the Managing Member shall deliver the
following (all of which shall be duly executed and acknowledged where
required):
(a) A written document of conveyance contributing to Operating
Partnership (and/or any Designated Subsidiary) title to Contributor's
Contributed Interests, free and clear of any adverse claim or interest;
(b) Such documents and certificates as Operating Partnership
reasonably may require to establish the authority of the parties executing
any documents in connection with the Contributions;
(c) Such consents and instruments of admission as contemplated
by Section 7.4 hereof; and
(d) Such other documents, instruments and certificates as
Operating Partnership and the Managing Member, as agent for the Contributors,
reasonably agree are necessary or appropriate, including without limitation
recording and transfer forms and affidavits.
8.2 OPERATING PARTNERSHIP'S CLOSING DOCUMENTS. At Closing,
Operating Partnership shall deliver or cause to be delivered to the Managing
Member, as agent for the Contributors, the following:
(a) The Units; and
(b) Such other documents and instruments as the Managing
Member, as agent for the Contributors, and Operating Partnership agree are
necessary or appropriate, including without limitation recording and transfer
forms and affidavits.
9. TRANSFER TAXES AND CLOSING COSTS.
(a) The Managing Member and Operating Partnership shall join
on the Closing Date in completing, executing, delivering and verifying the
returns, affidavits and other documents required in connection with the
documentary stamps in accordance with the New York State Real Estate Transfer
Tax imposed by Article 31 of the Tax Law, the New York City Real Property
Transfer Tax imposed by Title II of Chapter 46 of the Administrative Code of
the City of New York, and any other tax payable by reason of the contribution
of the Contributed Interests (collectively, the "Conveyance Taxes").
(b) The Contributors hereby agree to pay and shall be solely
responsible for the Conveyance Taxes due on the conveyance of the Contributed
Interests. Using the amount distributed to the Managing Member pursuant to
Section 2(b) hereof, the Managing Member, as agent for the Contributors,
shall timely pay to the appropriate tax collecting agency or official the
amount of all Conveyance Taxes payable by reason of the Contributors'
agreement to pay the Conveyance Taxes. The Contributors shall indemnify,
defend and hold harmless Operating Partnership and the Company from and
against all claims, liabilities, costs and expenses (including
9
reasonable attorney's fees), incurred by Operating Partnership or the Company
by reason of the failure of the Contributors to pay any Conveyance Taxes
assessed or alleged to be due at any time with respect to the transfer of the
Interests to Operating Partnership, including, without limitation, all
interest and penalties thereon.
(c) Operating Partnership shall also pay or provide for the
payment of all other costs associated with the closing of the acquisition of
the Contributed Interests pursuant to this Agreement, as described in the
Memorandum.
10. OPERATION IN THE ORDINARY COURSE. The Managing Member shall
use reasonable efforts to operate the Company and the Property in the
ordinary course of business between the date hereof and the closing of the
Consolidation, including making any necessary capital expenditures and
leasing expenditures consistent with past practices to maintain the quality
and value of the Property.
11. GENERAL PROVISIONS.
11.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. It is the express
intention and agreement of the parties hereto that the representations and
warranties of the parties set forth in this Agreement shall survive the
consummation of the Contributions and the Closing.
11.2 NOTICES. All notices, demands, requests or other
communications that may be or are required to be given or made by any party
to the other parties pursuant to this Agreement shall be in writing and shall
be hand delivered or transmitted by certified mail, express overnight mail or
delivery service, telegram, telex or facsimile transmission to the parties at
the addresses specified in Exhibit A or such other address as the addressee
may indicate by written notice to the other party.
Each notice, demand, request or communication that is given or made
in the manner described above shall be deemed sufficiently given or made for
all purposes at such time as it is delivered to the addressee (with the
delivery receipt, the affidavit of messenger or (with respect to a telex) the
answer back being deemed conclusive but not exclusive evidence of such
delivery) or at such time as delivery is refused by the addressee upon
presentation.
11.3 GOVERNING LAW. This Agreement, the rights and obligations of
the parties hereto and any claims or disputes relating to such rights and
obligations shall be governed by and construed under the laws of the State of
New York.
11.4 HEADINGS. Section and subsection headings contained in this
Agreement are inserted for convenience of reference only, shall not be deemed
to be a part of this Agreement for any purpose, and shall not in any way
define or affect the meaning, construction or scope of any of the provisions
hereof.
11.5 BENEFIT AND ASSIGNMENT. No Contributor shall assign this
Agreement, in whole or in part, whether by operation of law or otherwise,
without the prior written consent of Operating Partnership. Any purported
assignment contrary to the terms hereof shall be null, void and of no force
and effect.
This Agreement shall be binding upon and shall inure to the benefit
of the parties hereto and their respective successors and assigns as
permitted hereunder. No person or entity other than the parties hereto is or
shall be entitled to bring any action to enforce any provision of this
Agreement against any of the parties hereto, and the covenants and agreements
set forth in
10
this Agreement shall be solely for the benefit of, and shall be enforceable
only by, the parties hereto or their respective successors and assigns as
permitted hereunder.
The Operating Partnership may designate one or more Designated
Subsidiaries to acquire all or any part of the Contributed Interests (in
which case the Designated Subsidiary shall execute a certificate at closing
making the same representations and warranties as are made by Operating
Partnership and references to Operating Partnership shall include the
Designated Subsidiaries except where the context clearly indicates otherwise).
11.6 SEVERABILITY. If any part of any provision of this Agreement
or any other agreement, document or writing given pursuant to or in
connection with this Agreement shall be invalid or unenforceable under
applicable law, such part shall be ineffective to the extent of such
invalidity or unenforceability only, without in any way affecting the
remaining parts of such provisions or the remaining provisions of said
agreement so long as the economic and legal substance of the Contributions is
not affected in any manner materially adverse to either party.
11.7 ENTIRE AGREEMENT; AMENDMENT. The Schedules and the Exhibits
attached hereto are hereby incorporated into the Agreement as if fully set
forth herein. This Agreement, and the Schedules and Exhibits attached hereto
(each of which shall be deemed incorporated herein and made a part hereof),
together with the Memorandum, contain the final and entire agreement between
the parties hereto with respect to the Contributions, supersede all prior
oral and written memoranda and agreements with respect to the matters
contemplated herein, and are intended to be an integration of all prior
negotiations and understandings. Contributors and Operating Partnership
shall not be bound by any terms, conditions, statements, warranties or
representations, oral or written, not contained or referred to herein or
therein. No change or modification of this Agreement shall be valid unless
the same is in writing and signed by the parties hereto.
11.8 NO WAIVER. No delay or failure on the part of any party hereto
in exercising any right, power or privilege under this Agreement or under any
other instrument or document given in connection with or pursuant to this
Agreement shall impair any such right, power or privilege or be construed as
a waiver of any default or any acquiescence therein. No single or partial
exercise of any such right, power or privilege shall preclude the further
exercise of such right, power or privilege. No waiver shall be valid against
any party hereto unless made in writing and signed by the party against whom
enforcement of such waiver is sought and then only to the extent expressly
specified therein.
11.9 CONSENT AND POWER OF ATTORNEY. The Managing Member hereby
consents to the contribution of the Contributed Interests pursuant hereto by
each of the Contributors. Each Contributor is executing a Partner Consent
pursuant to which such Contributor (a) is executing this Agreement, and (b)
is consenting to each matter set forth therein. In addition, by executing
this Agreement pursuant to the Consent, each Contributor is constituting and
appointing each of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇▇▇▇ ▇.
▇▇▇▇, individually, with full power of substitution, the true and lawful
attorney-in-fact (the "Attorney") of such Contributor, with full power and
authority in the name of and for and on behalf of such Contributor, to
execute an instrument of conveyance contributing his, her or its Contributed
Interests to Operating Partnership pursuant to the Consolidation on the terms
set forth in the Memorandum, to execute the Partnership Agreement of
Operating Partnership and the Registration Rights Agreement (as such term is
defined in the Memorandum) and to execute any instruments required to be
filed in connection with the Conveyance Taxes, and to execute any other
instruments that the Managing Member reasonably determines necessary or
appropriate in connection with the contribution of the Interests pursuant to
this Agreement.
11
Each Contributor shall promptly notify the Managing Member if any of
the representations and warranties by that partner were not true and correct
when made or become untrue at any time prior to the Closing.
IN WITNESS WHEREOF, each of the Contributors has executed a separate
Partner Consent agreeing to be bound by the terms of the Agreement and each
of Operating Partnership, and the Managing Member has caused this Agreement
to be duly executed and delivered on its or his behalf as of the date first
above written.
THE MENDIK COMPANY, L.P.
By: Mendik Group, Inc.
By
---------------------------------
Name:
Title:
-----------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
12
AGREEMENT FOR CONTRIBUTION OF INTERESTS
[ELEVEN PENN PLAZA]
THIS AGREEMENT for the Contribution of Interests (this
"Agreement") is made and entered into as of ___________, 1996, by and among
The Mendik Company, L.P. ("Operating Partnership"), a Delaware limited
partnership, whose managing general partner is the Mendik Group, Inc. (the
"REIT"), a Delaware corporation, each of the parties listed on Exhibit A
annexed hereto who executes a Partner Consent (hereinafter defined) agreeing to
become a party to this Agreement (collectively referred to herein as
"Contributors") and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ (in his capacity as a general partner of
the Partnerships (hereinafter defined), the "General Partner").
WHEREAS, it is desired to consolidate (the "Consolidation")
interests in up to seven general or limited partnerships or limited liability
companies of which the General Partner or an affiliate is a general partner,
together with the assets of Mendik Realty Company, Inc. and Mendik Management
Company, Inc., each a New York corporation and affiliate of the General
Partner, with and into Operating Partnership and to effect the initial public
offering (the "Offering") of shares of common stock of the REIT ("Common
Stock").
WHEREAS, prior to the Consolidation, the REIT shall merge into
The Mendik Company, Inc., a Maryland corporation, and from and after such
merger, all references herein to the REIT shall refer to The Mendik Company,
Inc.
WHEREAS, Contributors are owners of interests (the "Contributed
Interests") in M/F Associates, a New York limited partnership, MS Associates,
a New York limited partnership, M/F Eleven Associates, a New York limited
Partnership and M/S Eleven Associates, a New York limited partnership
(collectively, the "Partnerships"), which together own all of the partnership
interests in M393 Associates, a New York general partnership, and M Eleven
Associates, a new York general partnership (collectively, the "Middle
Partnerships"), which together own all of the interests in Eleven Penn Plaza
Company, a New York joint venture ("Eleven Penn"), which owns land and
improvements (the "Property") known as ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇;
WHEREAS, in connection with the consummation of the Consolidation
and the Offering, the parties hereto desire that Operating Partnership and,
if designated by Operating Partnership, one or more special purpose
subsidiary partnerships or limited liability companies of Operating
Partnership or one or more other entities controlled by Operating Partnership
(each a "Designated Subsidiary") acquire all of the interests in the
Partnerships through the contribution of such interests to Operating
Partnership and/or one or more Designated Subsidiaries upon the terms and
conditions provided herein; and
WHEREAS, if the holders of all of the interests in the
Partnerships do not execute the Partner Consent annexed to and forming a part
of the Memorandum (the "Partner Consent"), it is contemplated that Operating
Partnership may purchase only those interests in the Partnerships owned by
the Contributors, or Operating Partnership and the Partnerships, the Middle
Partnerships and/or Eleven Penn may attempt to effect the Consolidation in
another manner.
NOW, THEREFORE, in consideration of the foregoing and the mutual
promises and covenants set forth herein, Operating Partnership, Contributors
and the General Partner hereby agree as follows:
1. CONTRIBUTIONS. Upon the Closing (hereinafter defined), and
subject to the satisfaction or waiver by Operating Partnership of the
conditions set forth in Section 7 of this Agreement, Contributors shall
contribute, convey and assign to Operating Partnership (and/or Designated
Subsidiary) and Operating Partnership (and/or Designated Subsidiary) shall
acquire from Contributors all of Contributors' right, title and interest in
the Contributed Interests (the "Contributions"), including, without
limitation, all of Contributors' interest in the profits, losses, property
and capital of the Partnership allocable to the Contributed Interests, upon
the terms and conditions set forth in this Agreement.
2. CONSIDERATION; DISTRIBUTIONS PRIOR TO CLOSING.
(a) In full consideration for the contribution of the
Contributed Interests, Operating Partnership shall deliver to Contributors at
the Closing, (i) with respect to the Property Value (as such term is defined
in the Memorandum) for the Property, units of limited partnership interests
("Units") in Operating Partnership, determined in accordance with the
methodology described in the Confidential Solicitation of Consents and
Private Placement Memorandum (the "Memorandum") dated November 11, 1996, and
(ii) additional Units as determined in accordance with Section 2(b) hereof.
(b) If the aggregate amount of the Net Other Assets
(hereinafter defined) of Eleven Penn as of the close of business on the day
preceding the date of the Closing (the "Closing Date") exceeds $0, Operating
Partnership may elect to include all or any portion of such excess Net Other
Assets (the "Included Excess Net Other Assets") in the transaction and issue
Units (valued at the Final Offering Price (as such term is defined in the
Memorandum) of the shares of Common Stock in the Offering) with a value equal
to the amount of the Included Excess Net Other Assets; on the Closing Date,
immediately prior to the Closing, the General Partner shall cause Eleven Penn
to distribute to the Middle Partnerships and the Middle Partnerships to
distribute to the Partnerships and the Partnerships to distribute their
partners an amount equal to any Net Other Assets which are in excess of the
Included Excess Net Other Assets; provided however, if less than all of the
partners of M/F Associates, M/F Eleven Associates, M/S Associates and M/S
Eleven Associates are Contributors, Operating Partnership shall issue Units
with respect to the Included Excess Net Other Assets allocable only to the
Contributors.
If the aggregate amount of the Net Other Assets of Eleven
Penn as of the close of business on the day preceding the Closing Date is
less than $0, then, Operating Partnership may terminate this Agreement by
notice to the Contributors.
As used in this Agreement, the following terms have the
following meanings:
(i) "Net Other Assets" means the excess of Certain Other
Assets over Certain Other Liabilities (as such terms are hereinafter
defined).
(ii) "Certain Other Assets" means cash and cash
equivalents, marketable securities, accounts receivable (including any rent
escalations payable with respect to the period through the Closing Date, but
excluding any receivable with respect to any period after the month in which
the Closing occurs, as well as any amount payable after the month in which
the Closing occurs to the extent such amount has been recognized as income
prior to the Closing), prepaid expenses (excluding any prepaid leasing costs
relating to leases entered into prior to October 1, 1996), escrow deposits
made by Eleven Penn, capital expenditures (other than tenant improvements or
building improvements required by the terms of any lease and other than those
committed capital expenditures listed on Exhibit B annexed hereto) made on or
after October 1,
2
1996, amounts paid for leasing costs, tenant and building improvements or
tenant acquisition costs relating to (1) leases entered into on or after
October 1, 1996 and (2) leases entered into prior to October 1, 1996 but only
to the extent of any leasing expenditures with respect to such leases entered
into prior to October 1, 1996 which are set forth on Exhibit C annexed
hereto. For the purpose of calculating Certain Other Assets, the accounts
receivable of Eleven Penn shall be valued at the face amount of the accounts
receivable, net of a reserve for doubtful accounts determined in accordance
with generally accepted accounting principles consistently applied (but
without giving effect to the straight line requirement of FASB 13).
(iii) "Certain Other Liabilities" means accounts
payable, accrued interest payable and other accrued liabilities (including
any liability or obligation for leasing costs, tenant or building
improvements or tenant acquisition costs payable relating to leases entered
into prior to October 1, 1996, but excluding any liability or obligation for
leasing costs, tenant or building improvements or tenant acquisition costs
payable relating to (1) leases entered into on or after October 1, 1996 and
(2) leases entered into prior to October 1, 1996, but only to the extent of
any leasing expenditures with respect to such leases entered into prior to
October 1, 1996 which are set forth on Exhibit C annexed hereto), the unpaid
remaining cost of any committed capital expenditures listed on Exhibit B
annexed hereto and prepaid rent received from tenants.
For purposes of this Section 2, the exercise of an option
to renew a lease or to rent additional space pursuant to a lease shall be
deemed a new lease entered into on the date the renewal option is exercised
or the additional space is leased.
(c) The General Partner shall prepare and submit to Operating
Partnership, not later than five days prior to the Closing Date, its best,
good faith estimate of the Net Other Assets as of the close of business on
the day preceding the Closing Date; such estimate shall be determined based
upon the books and records of Eleven Penn. The estimate submitted to
Operating Partnership shall be accompanied by (i) a statement setting forth
in reasonable detail the calculation of the estimated Net Other Assets as of
the close of business on the day preceding the Closing Date, and (ii) a
certificate signed by the General Partner confirming that the estimate was
calculated in accordance with the terms of this Section 2. The estimate
shall be final and binding on the parties unless, at least two days prior to
the Closing, Operating Partnership gives written notice to the General
Partner that it objects to any item. The Operating Partnership and the
General Partner shall immediately consult with respect to any item objected
to and their joint determination with respect to any items in dispute shall
be final and binding on the parties. The number of additional Units to be
delivered at Closing shall be based on the statement of Net Other Assets
delivered by the General Partner (or the undisputed amount of Net Other
Assets) and the amount of Included Excess Net Other Assets based thereon. If
Operating Partnership and the General Partner are unable to reach agreement
on the amount of Net Other Assets prior to Closing, within ten days after the
Closing, the dispute shall be referred to and resolved by a "Big 6" firm of
independent certified public accountants proposed by Operating Partnership
and reasonably acceptable to the General Partner, and the determination by
that accounting firm shall be final and binding on the parties. Promptly
after that determination, Operating Partnership shall deliver to the General
Partner, as agent for the Contributors, any additional Units payable as a
result of the determination. The fees and expenses of the accounting firm
shall be borne by Operating Partnership.
(d) Any amounts collected by Operating Partnership after the
Closing Date relating to the period through the Closing Date with respect to
refunds of real estate taxes paid by Eleven Penn (less any costs incurred by
Operating Partnership in obtaining such refunds and less any portion of such
refunds required to be paid to tenants) shall be promptly paid to the General
3
Partner, as agent for the Contributors, not later than 10 days after the end
of the month in which such amounts are collected.
(e) Prior to the close of business on the day preceding the
Closing, the General Partner shall cause each of the Middle Partnerships and
each of the Partnerships to satisfy any outstanding liabilities and, on the
Closing Date, the General Partner shall cause Eleven Penn to distribute to
the Partnerships and the Partnerships to distribute to the General Partners,
as agent for the Contributors, approximately $1,900,000 to pay the Conveyance
Taxes (hereinafter defined) payable by them pursuant to Section 9(b) hereof
(any amount so distributed by Eleven Penn to be deducted prior to the
calculation of Net Other Assets).
3. ACCEPTANCE OF CONTRIBUTIONS. Operating Partnership hereby
agrees that at the Closing it shall accept the Contributions and shall assume
any and all rights, obligations and responsibilities of Contributors as
owners of the Contributed Interests that arise from and after the Closing
Date.
4. CLOSING TIME AND PLACE. Unless another date or place is
agreed to by the parties, the closing of the Contributions (the "Closing")
shall take place contemporaneously with the closing of the Consolidation and
the Offering at the offices of Proskauer ▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇ LLP, ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or such other place and time as Operating
Partnership and the General Partner shall agree upon, upon the satisfaction
or waiver of all conditions to the Closing set forth in Section 7 hereof.
5. REPRESENTATIONS AND WARRANTIES OF OPERATING PARTNERSHIP.
Operating Partnership hereby represents and warrants to Contributors as
follows, which representations and warranties shall be true and correct on
the Closing Date:
5.1 ORGANIZATION, POWER AND AUTHORITY, AND QUALIFICATION.
Operating Partnership is a limited partnership duly organized, validly
existing and in good standing under the laws of the State of Delaware. The
REIT is a corporation duly organized, validly existing and in good standing
under the laws of its state of incorporation. Each of Operating Partnership
and the REIT has the requisite power and authority to carry on its respective
business as it is now being conducted. Each of Operating Partnership and the
REIT is qualified to do business and is in good standing in each jurisdiction
in which the character of its property owned or leased or the nature of its
activities makes such qualification necessary, except where the failure to be
so qualified and in good standing would not have a material adverse effect on
the business or financial condition of Operating Partnership or the REIT, as
the case may be.
5.2 AUTHORITY RELATIVE TO THIS AGREEMENT. Operating Partnership
has taken all action necessary to authorize the execution, delivery and
performance of this Agreement by Operating Partnership and no other
proceedings on the part of Operating Partnership are necessary to authorize
the execution and delivery of this Agreement and the consummation of the
Contributions.
None of the execution and delivery of this Agreement by Operating
Partnership, the consummation by Operating Partnership of the Contributions
or compliance by Operating Partnership with any of the provisions hereof
shall (i) conflict with or result in any breach of any provisions of the
Partnership Agreement of Operating Partnership; (ii) result in a violation or
breach of, or constitute (with or without due notice or lapse of time or
both) a default (or give rise to any right of termination, cancellation or
acceleration) under any of the terms, conditions or provisions of any note,
bond, mortgage, indenture, lease, license, contract, agreement or other
instrument or obligation to which Operating Partnership is a party or by
which it or any of its
4
properties or assets may be bound; or (iii) violate any order, writ, injunction,
decree, statute, rule or regulation applicable to Operating Partnership; except
in the case of (ii) or (iii) for violations, breaches, or defaults (A) that
would not in the aggregate have a material adverse effect on the business or
financial condition of Operating Partnership or the REIT, and that shall not
impair the effectiveness of the Contributions contemplated hereby, or (B) for
which waivers or consents have been or shall be obtained prior to the Closing
Date.
5.3 BINDING OBLIGATION. This Agreement has been duly and validly
executed and delivered by Operating Partnership and constitutes a valid and
binding agreement of Operating Partnership, enforceable against Operating
Partnership in accordance with its terms, except that such enforcement may be
subject to bankruptcy, conservatorship, receivership, insolvency, moratorium,
or similar laws affecting creditors' rights generally or the rights of
creditors of limited partnerships and to general principles of equity.
5.4 INSOLVENCY. There are no attachments, executions or
assignments for the benefit of creditors, or voluntary or involuntary
proceedings in bankruptcy, or under any other debtor relief laws,
contemplated by or pending or threatened against Operating Partnership.
5.5 BROKERS. Neither Operating Partnership nor the REIT has
employed or dealt with any broker or finder, or incurred any liability
therefor, in connection with the Contributions.
5.6 VALID CONSIDERATION. The Units, when issued in accordance
with this Agreement and the Operating Agreement of Operating Partnership,
shall be duly and validly issued, fully paid and nonassessable, and the
issuance thereof shall not be subject to preemptive or other similar rights.
6. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF CONTRIBUTORS.
Each Contributor, in his, her or its capacity as a partner of the
Partnership, hereby represents and warrants to and agrees with Operating
Partnership with respect to his, her or its Contributed Interests as follows,
which representations and warranties shall be true and correct on the Closing
Date:
6.1 TITLE; AUTHORITY TO ASSIGN. Contributor (i) owns good and
marketable, legal and beneficial title in and to his, her or its Contributed
Interests which are held or by the Closing Date shall be held free of liens,
encumbrances, judgments, adverse interests, pledges and security interests,
other than any such interests in the Contributed Interests granted pursuant
to the Operating Agreement of the Partnership, (ii) holds the entire right,
title and interest in and to his, her or its Contributed Interests, and (iii)
has the full right, power, capacity and authority to validly contribute and
convey his, her or its Contributed Interests pursuant to this Agreement.
6.2 NO BREACH OF OPERATING AGREEMENT. None of the execution and
delivery of this Agreement by Contributor, the consummation by Contributor of
the Contributions or compliance by Contributor with any of the provisions
hereof shall as of the Closing Date conflict with or result in any breach of
any provisions of the Operating Agreement of the Partnership or any other
agreement to which Contributor is a party.
6.3 INSOLVENCY. There are no attachments, executions or
assignments for the benefit of creditors, or voluntary or involuntary
proceedings in bankruptcy, or under any other debtor relief laws,
contemplated by or pending or, to the knowledge of Contributor, threatened
against Contributor.
5
6.4 LITIGATION. Contributor has no knowledge of any actual or
pending litigation or proceeding by any organization, person, individual or
governmental agency against Contributor with respect to or against or
potentially affecting his, her or its Contributed Interests.
6.5 BINDING OBLIGATION, ETC. This Agreement has been duly and
validly executed and delivered by Contributor to Operating Partnership and
constitutes a legal, valid and binding agreement of Contributor, enforceable
against Contributor in accordance with its terms, except as such enforcement
may be limited by bankruptcy, conservatorship, receivership, insolvency,
moratorium or similar laws affecting creditors' rights generally and to
general principles of equity. Contributor further represents and warrants
that if Contributor is a corporation, partnership, trust or other entity, it
has the power to, and is duly authorized and otherwise duly qualified to,
purchase and hold securities such as Units and shares of Common Stock and
such entity has its principal place of business as set forth on Exhibit A.
6.6 BROKERS. Contributor has not employed or dealt with any
broker or finder, or incurred any liability therefor, in connection with the
Contributions.
6.7 SECURITIES ACT AND OTHER REPRESENTATIONS AND AGREEMENTS.
(a) (i) Upon the issuance of Units to Contributor,
Contributor shall become subject to, and shall be bound by, the terms and
provisions of the Partnership Agreement of Operating Partnership, including
the terms of the power of attorney contained in Section 15.11 thereof, as the
Partnership Agreement may be amended and restated from time to time in
accordance with its terms.
(ii) Contributor or his, her or its advisor(s) have had
a reasonable opportunity to ask questions of and receive information and
answers from a person or persons acting on behalf of the Partnership
concerning the Consolidation, and, as Contributor may deem necessary, to
verify the information contained in the Memorandum, receipt of which is
acknowledged, and any other information provided to Contributor by the
Partnership or Operating Partnership and all such questions have been
answered and all such information has been provided to the full satisfaction
of Contributor.
(iii) Contributor is acquiring Units for his, her or its
own account as principal, for investment and not with a view to resale or
distribution, that the shares of Common Stock of the REIT which may be
obtained upon redemption of the Units may not be transferred or otherwise
disposed of by Contributor otherwise than in transactions pursuant to the
registration statement required to be filed by the Partnership with respect
to such shares of Common Stock or that are exempt from the registration
requirements of the Securities Act of 1933 (the "Securities Act") and all
applicable state and foreign securities laws, and that the REIT may refuse to
transfer any shares of Common Stock as to which evidence of such registration
or exemptions from such registration satisfactory to the REIT is not provided
to it.
(iv) Contributor has sufficient knowledge and experience
in financial, tax and business matters to enable him, her or it to evaluate
the merits and risks of an investment in the Units. Contributor has the
ability to bear the economic risk of acquiring the Units. Contributor
acknowledges that (1) the transactions contemplated by this Agreement and the
Memorandum involve complex tax consequences for each Contributor and each
Contributor is relying solely on the advice of his, her or its own tax
advisors in evaluating such consequences, and (2) neither Operating
Partnership nor the General Partner has made (or shall be deemed to have
made) any representations or warranties as to the tax consequences of such
transaction to any
6
Contributor. Each Contributor remains solely responsible for all tax matters
relating to each Contributor.
(v) If needed, Contributor has discussed with his, her
or its professional, legal, tax or financial advisors the suitability of an
investment in Units or shares of Common Stock for his, her or its particular
tax and financial situation. Nothing contained herein or in the Memorandum
shall be deemed to imply any representation by Operating Partnership or the
General Partner as to a particular tax effect that may be obtained by any
Contributor. All information that Contributor has provided to Operating
Partnership concerning himself or herself or itself and his, her or its
financial position is correct and complete as of the date hereof, and if
there should be any material change in such information prior to issuance of
Units to the partners, he, she or it shall immediately provide such changed
information to Operating Partnership.
(vi) Contributor has not disclosed any information
contained in the Memorandum to anyone other than his or her spouse or his,
her or its professional, legal, tax or financial advisors advising him, her
or it in connection with this investment and has not reproduced the
Memorandum other than for the use of such advisors.
(b) STATUS AS A UNITED STATES PERSON. (i) Unless otherwise
indicated on the Partner Consent, Contributor certifies that Contributor is
not a foreign person within the meaning of Section 1445 of the Internal
Revenue Code ("Section 1445"). To the extent that Contributor is not a
foreign person within the meaning of Section 1445, (1) Contributor's U.S.
taxpayer identification number that has previously been provided to the
Partnership is accurate, (2) Contributor's home address (in the case of an
individual) or office address (in the case of an entity) is that address
indicated on Exhibit A of this Agreement and (3) if Contributor subsequently
becomes a foreign person within the meaning of Section 1445, Contributor
shall notify Operating Partnership within sixty (60) days of doing so.
(ii) If Contributor is a foreign person within the
meaning of Section 1445, Operating Partnership shall withhold ten percent
(10%) of the amount realized (as such term is defined in Section 1001 of the
Internal Revenue Code) by Contributor in connection with the Contributions,
unless Operating Partnership shall receives from Contributor a notice of
nonrecognition transfer with respect to the Contributions by Contributor (in
a form to be provided by Operating Partnership).
(c) INDEMNIFICATION. Contributor hereby agrees to indemnify
and hold harmless the Partnership, the REIT, Operating Partnership and the
General Partner and any of the employees, agents, officers, directors and
affiliated persons of the foregoing from any and all damages, losses, costs
and expenses (including reasonable attorneys' fees) which they, or any of
them, may incur by reason of a failure by Contributor to fulfill any of the
terms and conditions of this Agreement or by reason of the breach by
Contributor of any of the representations and warranties contained herein.
(d) WAIVER AND CONTRIBUTIONS. Contributor understands that
(i) the Units to be issued pursuant to the Consolidation have not been
registered under the Securities Act and (ii) the failure to register such
Units could result in Contributor being granted certain rights under the
Federal securities laws, including a right to rescind Contributor's consent
to the Consolidation. For the benefit of Operating Partnership, and in
consideration of Operating Partnership's consummating the Consolidation,
Contributor (x) hereby waives any and all rights he or she now has or may
hereafter be granted to rescind his or her consent to the Consolidation on
the basis that the Units issued in connection with the Consolidation were not
registered (the "Waiver") and (y) agrees that if the Waiver is deemed void or
unenforceable for any reason, including, without
7
limitation, under Section 14 of the Securities Act, the entire beneficial
interest in all property and amounts received by Contributor in any action to
rescind the Consolidation (regardless of whether such action was initiated by
Contributor) or otherwise received by Contributor as damages for failure to
register the Units under the Securities Act, shall be promptly paid over and
contributed by Contributor to Operating Partnership, for no additional
consideration from Operating Partnership, other than the Units originally issued
pursuant to the Consolidation.
Whenever the context shall require, all words in the male, female
or neuter gender shall be deemed to include the other genders, all singular
words shall include the plural, and all plural words shall include the
singular. All representations, covenants and agreements of Contributor set
forth in this Agreement shall survive the consummation of the Consolidation
contemplated by the Memorandum.
7. CONDITIONS TO COMPLETION. In addition to the conditions to
completion of the Consolidation set forth in the Memorandum, the obligations
of Operating Partnership to consummate the transactions contemplated by this
Agreement shall be subject to fulfillment (or waiver by Operating
Partnership) at or prior to the Closing of the following conditions:
7.1 REPRESENTATIONS, WARRANTIES AND COVENANTS. The
representations, warranties and covenants made by Contributors in this
Agreement or in any document delivered by any of them pursuant to this
Agreement shall be true and correct in all material respects when made and on
and as of the Closing as though such representations, warranties and
covenants were made on and as of such date.
7.2 ACTIONS AFFECTING CONTRIBUTED INTERESTS. Contributors shall
not have sold, assigned, leased, pledged, transferred or encumbered any of
the Contributed Interests, or entered into any other consent, commitment,
understanding or other agreement, or have incurred any material obligation or
liability (contingent or absolute) with respect to the Contributed Interests.
7.3 NO MATERIAL ADVERSE CHANGE. There shall have been no
material adverse change in the value or condition of the Partnership or the
Property since the date hereof, except for changes resulting from the operation
of the Partnership in the ordinary course of business consistent with past
practice or as otherwise contemplated by the Memorandum, in each case that do
not have a material adverse effect on the business or financial condition of the
Partnership.
7.4 CONSENTS. Any and all consents required by the Operating
Agreement of the Partnership, and any certificates, agreements, contribution
and assumption instruments and other documents necessary or advisable to
evidence the conveyance of the Contributed Interests and the admission of
Operating Partnership (or Designated Subsidiary) into the Partnership by
virtue of the contribution of the Contributed Interests, shall have been
obtained.
7.5 NO ORDER OR INJUNCTION. The consummation of the
Contributions shall not have been restrained, enjoined or prohibited by any
order or injunction of any court or governmental authority of competent
jurisdiction.
7.6 CONSOLIDATION. In addition to the consents set forth in
Section 7.4 above, all conditions to the closing of the Consolidation set
forth in the underwriting agreement with respect to the Offering shall have
been satisfied on terms satisfactory to Operating Partnership and the General
Partner.
8
8. THE CLOSING.
8.1 CONTRIBUTORS' CLOSING DOCUMENTS. At Closing, each Contributor
shall deliver (or cause to be delivered pursuant to the Power of Attorney
referred to in Section 11.9) or the General Partner shall deliver the
following (all of which shall be duly executed and acknowledged where
required):
(a) A written document of conveyance contributing to
Operating Partnership (and/or any Designated Subsidiary) title to
Contributor's Contributed Interests, free and clear of any adverse claim or
interest;
(b) Such documents and certificates as Operating Partnership
reasonably may require to establish the authority of the parties executing
any documents in connection with the Contributions;
(c) Such consents and instruments of admission as
contemplated by Section 7.4 hereof; and
(d) Such other documents, instruments and certificates as
Operating Partnership and the General Partner, as agent for the Contributors,
reasonably agree are necessary or appropriate, including without limitation
recording and transfer forms and affidavits.
8.2 OPERATING PARTNERSHIP'S CLOSING DOCUMENTS. At Closing,
Operating Partnership shall deliver or cause to be delivered to the General
Partner, as agent for the Contributors, the following:
(a) The Units; and
(b) Such other documents and instruments as the General
Partner, as agent for the Contributors, and Operating Partnership agree are
necessary or appropriate, including without limitation recording and transfer
forms and affidavits.
9. TRANSFER TAXES AND CLOSING COSTS.
(a) The General Partner and Operating Partnership shall join
on the Closing Date in completing, executing, delivering and verifying the
returns, affidavits and other documents required in connection with the
documentary stamps in accordance with the New York State Real Estate Transfer
Tax imposed by Article 31 of the Tax Law, the New York City Real Property
Transfer Tax imposed by Title II of Chapter 46 of the Administrative Code of
the City of New York, and any other tax payable by reason of the contribution
of the Contributed Interests (collectively, the "Conveyance Taxes").
(b) The Contributors hereby agree to pay and shall be solely
responsible for the Conveyance Taxes due on the conveyance of the Contributed
Interests. Using the amount distributed to the General Partner pursuant to
Section 2(b) hereof, the General Partner, as agent for the Contributors,
shall timely pay to the appropriate tax collecting agency or official the
amount of all Conveyance Taxes payable by reason of the Contributors'
agreement to pay the Conveyance Taxes. The Contributors shall indemnify,
defend and hold harmless Operating Partnership and the Partnership from and
against all claims, liabilities, costs and expenses (including reasonable
attorney's fees), incurred by Operating Partnership or the Partnership by
reason of the failure of the Contributors to pay any Conveyance Taxes
assessed or alleged to be due at any time with
9
respect to the transfer of the Interests to Operating Partnership, including,
without limitation, all interest and penalties thereon.
(c) Operating Partnership shall also pay or provide for the
payment of all other costs associated with the closing of the acquisition of
the Contributed Interests pursuant to this Agreement, as described in the
Memorandum.
10. OPERATION IN THE ORDINARY COURSE. The General Partner shall
use reasonable efforts to operate the Partnership and the Property in the
ordinary course of business between the date hereof and the closing of the
Consolidation, including making any necessary capital expenditures and
leasing expenditures consistent with past practices to maintain the quality
and value of the Property.
11. GENERAL PROVISIONS.
11.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. It is the
express intention and agreement of the parties hereto that the
representations and warranties of the parties set forth in this Agreement
shall survive the consummation of the Contributions and the Closing.
11.2 NOTICES. All notices, demands, requests or other
communications that may be or are required to be given or made by any party
to the other parties pursuant to this Agreement shall be in writing and shall
be hand delivered or transmitted by certified mail, express overnight mail or
delivery service, telegram, telex or facsimile transmission to the parties at
the addresses specified in Exhibit A or such other address as the addressee
may indicate by written notice to the other party.
Each notice, demand, request or communication that is given or
made in the manner described above shall be deemed sufficiently given or made
for all purposes at such time as it is delivered to the addressee (with the
delivery receipt, the affidavit of messenger or (with respect to a telex) the
answer back being deemed conclusive but not exclusive evidence of such
delivery) or at such time as delivery is refused by the addressee upon
presentation.
11.3 GOVERNING LAW. This Agreement, the rights and obligations
of the parties hereto and any claims or disputes relating to such rights and
obligations shall be governed by and construed under the laws of the State of
New York.
11.4 HEADINGS. Section and subsection headings contained in this
Agreement are inserted for convenience of reference only, shall not be deemed
to be a part of this Agreement for any purpose, and shall not in any way
define or affect the meaning, construction or scope of any of the provisions
hereof.
11.5 BENEFIT AND ASSIGNMENT. No Contributor shall assign this
Agreement, in whole or in part, whether by operation of law or otherwise,
without the prior written consent of Operating Partnership. Any purported
assignment contrary to the terms hereof shall be null, void and of no force
and effect.
This Agreement shall be binding upon and shall inure to the benefit
of the parties hereto and their respective successors and assigns as
permitted hereunder. No person or entity other than the parties hereto is or
shall be entitled to bring any action to enforce any provision of this
Agreement against any of the parties hereto, and the covenants and agreements
set forth in this Agreement shall be solely for the benefit of, and shall be
enforceable only by, the parties hereto or their respective successors and
assigns as permitted hereunder.
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The Operating Partnership may designate one or more Designated
Subsidiaries to acquire all or any part of the Contributed Interests (in
which case the Designated Subsidiary shall execute a certificate at closing
making the same representations and warranties as are made by Operating
Partnership and references to Operating Partnership shall include the
Designated Subsidiaries except where the context clearly indicates
otherwise).
11.6 SEVERABILITY. If any part of any provision of this Agreement
or any other agreement, document or writing given pursuant to or in
connection with this Agreement shall be invalid or unenforceable under
applicable law, such part shall be ineffective to the extent of such
invalidity or unenforceability only, without in any way affecting the
remaining parts of such provisions or the remaining provisions of said
agreement so long as the economic and legal substance of the Contributions is
not affected in any manner materially adverse to either party.
11.7 ENTIRE AGREEMENT; AMENDMENT. The Schedules and the Exhibits
attached hereto are hereby incorporated into the Agreement as if fully set
forth herein. This Agreement, and the Schedules and Exhibits attached hereto
(each of which shall be deemed incorporated herein and made a part hereof),
together with the Memorandum, contain the final and entire agreement between
the parties hereto with respect to the Contributions, supersede all prior
oral and written memoranda and agreements with respect to the matters
contemplated herein, and are intended to be an integration of all prior
negotiations and understandings. Contributors and Operating Partnership
shall not be bound by any terms, conditions, statements, warranties or
representations, oral or written, not contained or referred to herein or
therein. No change or modification of this Agreement shall be valid unless
the same is in writing and signed by the parties hereto.
11.8 NO WAIVER. No delay or failure on the part of any party
hereto in exercising any right, power or privilege under this Agreement or
under any other instrument or document given in connection with or pursuant
to this Agreement shall impair any such right, power or privilege or be
construed as a waiver of any default or any acquiescence therein. No single
or partial exercise of any such right, power or privilege shall preclude the
further exercise of such right, power or privilege. No waiver shall be valid
against any party hereto unless made in writing and signed by the party
against whom enforcement of such waiver is sought and then only to the extent
expressly specified therein.
11.9 CONSENT AND POWER OF ATTORNEY. The General Partner hereby
consents to the contribution of the Contributed Interests pursuant hereto by
each of the Contributors. Each Contributor is executing a Partner Consent
pursuant to which such Contributor (a) is executing this Agreement, and (b)
is consenting to each matter set forth therein. In addition, by executing
this Agreement pursuant to the Consent, each Contributor is constituting and
appointing each of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇▇▇▇ ▇.
▇▇▇▇, individually, with full power of substitution, the true and lawful
attorney-in-fact (the "Attorney") of such Contributor, with full power and
authority in the name of and for and on behalf of such Contributor, to
execute an instrument of conveyance contributing his, her or its Contributed
Interests to Operating Partnership pursuant to the Consolidation on the terms
set forth in the Memorandum, to execute the Partnership Agreement of
Operating Partnership and the Registration Rights Agreement (as such term is
defined in the Memorandum) and to execute any instruments required to be
filed in connection with the Conveyance Taxes, and to execute any other
instruments that the General Partner reasonably determines necessary or
appropriate in connection with the contribution of the Interests pursuant to
this Agreement.
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Each Contributor shall promptly notify the General Partner if any
of the representations and warranties by that partner were not true and
correct when made or become untrue at any time prior to the Closing.
IN WITNESS WHEREOF, each of the Contributors has executed a
separate Partner Consent agreeing to be bound by the terms of the Agreement
and each of Operating Partnership, and the General Partner has caused this
Agreement to be duly executed and delivered on its or his behalf as of the
date first above written.
THE MENDIK COMPANY, L.P.
By: Mendik Group, Inc.
By: ________________________________
Name:
Title:
THE MENDIK PARTNERSHIP, L.P.
By: ________________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, general
partner
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AGREEMENT FOR CONTRIBUTION OF INTERESTS
[330 MADISON AVENUE]
THIS AGREEMENT for the Contribution of Interests (this "Agreement") is
made and entered into as of ___________, 1996, by and among The Mendik
Company, L.P. ("Operating Partnership"), a Delaware limited partnership,
whose managing general partner is Mendik Group, Inc. (the "REIT"), a Delaware
corporation, each of the parties listed on Exhibit A annexed hereto who
executes a Partner Consent (hereinafter defined) agreeing to become a party
to this Agreement (collectively referred to herein as "Contributors") and The
Mendik Partnership, L.P. (formerly known as The Mendik Company, L.P.) (in its
capacity as a general partner of the Partnership (hereinafter defined), the
"General Partner").
WHEREAS, it is desired to consolidate (the "Consolidation") interests in
up to seven general or limited partnerships or limited liability companies of
which the General Partner or an affiliate is a general partner, together with
the assets of Mendik Realty Company, Inc and Mendik Management Company, Inc.,
each a New York corporation and affiliate of the General Partner, with and
into Operating Partnership and to effect the initial public offering (the
"Offering") of shares of common stock of the REIT ("Common Stock").
WHEREAS, prior to the Consolidation, the REIT shall merge into The
Mendik Company, Inc., a Maryland corporation, and from and after such merger,
all references herein to the REIT shall refer to The Mendik Company, Inc.
WHEREAS, Contributors are owners of interests in M330 Associates, a New
York limited partnership (the "Partnership"), which is a general partner in
330 Madison Company, a New York general partnership ("330 Madison"), which
owns land and improvements (the "Property") known as ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇;
WHEREAS, Contributors wish to transfer all of their interests in the
Partnership (excluding the transfer by the General Partner of a portion of
its interest as general partner of the Partnership equal to a 1% interest in
330 Madison and the obligations as managing general partner of the
Partnership, but including the General Partner's preference right to
distributions); provided, however, that unless all of the partners consent,
the General Partner's interest shall not be assigned (the interests to be
assigned by Contributors being hereinafter collectively referred to as the
"Contributed Interests");
WHEREAS, in connection with the consummation of the Consolidation and
the Offering, the parties hereto desire that Operating Partnership and, if
designated by Operating Partnership, one or more special purpose subsidiary
partnerships or limited liability companies of Operating Partnership or one
or more other entities controlled by Operating Partnership (each a
"Designated Subsidiary") acquire all of the interests in the Partnership
through the contribution of such interests to Operating Partnership and/or
one or more Designated Subsidiaries upon the terms and conditions provided
herein; and
WHEREAS, if the holders of all of the interests in the Partnership do
not execute the Partner Consent annexed to and forming a part of the
Memorandum (the "Partner Consent"), it is contemplated that Operating
Partnership shall purchase only those interests in the Partnership owned by
the Contributors.
NOW, THEREFORE, in consideration of the foregoing and the mutual
promises and covenants set forth herein, Operating Partnership, Contributors
and the General Partner hereby agree as follows:
1. CONTRIBUTIONS. Upon the Closing (as defined below), and subject to
the satisfaction or waiver by Operating Partnership of the conditions set
forth in Section 7 of this Agreement, Contributors shall contribute, convey
and assign to Operating Partnership (and/or Designated Subsidiary) and
Operating Partnership (and/or Designated Subsidiary) shall acquire from
Contributors all of Contributors' right, title and interest in the
Contributed Interests (the "Contributions"), including, without limitation,
all of Contributors' interest in the profits, losses, property and capital of
the Partnership allocable to the Contributed Interests, upon the terms and
conditions set forth in this Agreement.
2. CONSIDERATION; DISTRIBUTIONS PRIOR TO CLOSING.
(a) In full consideration for the contribution of the Contributed
Interests, Operating Partnership shall deliver to Contributors at the
Closing, (i) with respect to the Property Value (as such term is defined in
the Memorandum) for the Property, units of limited partnership interests
("Units") in Operating Partnership, determined in accordance with the
methodology described in the Confidential Solicitation of Consents and
Private Placement Memorandum (the "Memorandum") dated November 11, 1996, and
(ii) additional Units as determined in accordance with Section 2(b) hereof.
(b) If the aggregate amount of the Net Other Assets (hereinafter
defined) of 330 Madison as of the close of business on the day preceding the
date of the Closing (the "Closing Date") exceeds $6,040,000, Operating
Partnership may elect to include all or any portion of the Specified
Percentage (hereinafter defined) of such excess Net Other Assets (the
"Included Excess Net Other Assets") in the transaction and issue Units
(valued at the Final Offering Price (as such term is defined in the
Memorandum) of the shares of Common Stock in the Offering) with a value equal
to the amount of the Included Excess Net Other Assets; on the Closing Date,
immediately prior to the Closing, the General Partner shall cause 330 Madison
to distribute to the Partnership and the Partnership to distribute to its
partners an amount equal to the Specified Percentage of any Net Other Assets
which are in excess of the sum of (i) 6,040,000 plus (ii) (1) the Included
Excess Net Other Assets divided by (2) the Specified Percentage.
If the aggregate amount of the Net Other Assets of 330 Madison as of the
close of business on the day preceding the Closing Date is less than
$6,040,000, then, notwithstanding the provisions of Section 2(e) hereof, the
Contributors shall cause the Partnership to have cash at Closing in an amount
equal to 24.75% of the amount by which the Net Other Assets are less than
$6,040,000. If the Partnership shall not have such cash at Closing, then
Operating Partnership may terminate this Agreement by notice to the
Contributors.
As used in this Agreement, the following terms have the following
meanings:
(i) "Net Other Assets" means the excess of Certain Other Assets over
Certain Other Liabilities (as such terms are hereinafter defined).
(ii) "Certain Other Assets" means cash and cash equivalents,
marketable securities, accounts receivable (including any rent escalations
payable with respect to the period through the Closing Date, but excluding
any receivable with respect to any period after the month in which the
Closing occurs, as well as any amount payable after the month in which the
2
Closing occurs to the extent such amount has been recognized as income prior
to the Closing), prepaid expenses (excluding any prepaid leasing costs
relating to leases entered into prior to October 1, 1996), escrow deposits
made by 330 Madison, capital expenditures (other than tenant improvements or
building improvements required by the terms of any lease and other than those
committed capital expenditures listed on Exhibit B annexed hereto) made on or
after October 1, 1996, amounts paid for leasing costs, tenant and building
improvements or tenant acquisition costs relating to (1) leases entered into
on or after October 1, 1996 and (2) leases entered into prior to October 1,
1996, but only to the extent of any leasing expenditures with respect to such
leases entered into prior to October 1, 1996 which are set forth on Exhibit C
annexed hereto. For the purpose of calculating Certain Other Assets, the
accounts receivable of 330 Madison shall be valued at the face amount of the
accounts receivable, net of a reserve for doubtful accounts determined in
accordance with generally accepted accounting principles consistently applied
(but without giving effect to the straight line requirement of FASB 13).
(iii) "Certain Other Liabilities" means accounts payable, accrued
interest payable and other accrued liabilities (including any liability or
obligation for leasing costs, tenant or building improvements or tenant
acquisition costs payable relating to leases entered into prior to October 1,
1996 but excluding any liability or obligation for leasing costs, tenant or
building improvements or tenant acquisition costs payable relating to (1)
leases entered into on or after October 1, 1996 and (2) leases entered into
prior to October 1, 1996, but only to the extent of any leasing expenditures
with respect to such leases entered into prior to October 1, 1996 which are
set forth on Exhibit C annexed hereto), the unpaid remaining cost of any
committed capital expenditures listed on Exhibit B annexed hereto and prepaid
rent received from tenants.
(iv) "Specified Percentage" means the quotient, expressed as a
percentage, of (1) the product of 25 and a fraction, the numerator of which
is the percentage interest in the Partnership represented by the Contributed
Interests and the denominator of which is 100, and (2) 100.
For purposes of this Section 2, the exercise of an option to renew a
lease or to rent additional space pursuant to a lease shall be deemed a new
lease entered into on the date the renewal option is exercised or the
additional space is leased.
(c) The General Partner shall prepare and submit to Operating
Partnership, not later than five days prior to the Closing Date, its best,
good faith estimate of the Net Other Assets as of the close of business on
the day preceding the Closing Date; such estimate shall be determined based
upon the books and records of 330 Madison. The estimate submitted to
Operating Partnership shall be accompanied by (i) a statement setting forth
in reasonable detail the calculation of the estimated Net Other Assets as of
the close of business on the day preceding the Closing Date, and (ii) a
certificate signed by the General Partner confirming that the estimate was
calculated in accordance with the terms of this Section 2. The estimate
shall be final and binding on the parties unless, at least two days prior to
the Closing, Operating Partnership gives written notice to the General
Partner that it objects to any item. The Operating Partnership and the
General Partner shall immediately consult with respect to any item objected
to and their joint determination with respect to any items in dispute shall
be final and
3
binding on the parties. The number of additional Units to be delivered at
Closing shall be based on the statement of Net Other Assets delivered by the
General Partner (or the undisputed amount of Net Other Assets) and the amount
of Included Excess Net Other Assets based thereon. If Operating Partnership
and the General Partner are unable to reach agreement on the amount of Net
Other Assets prior to Closing, within ten days after the Closing, the dispute
shall be referred to and resolved by a "Big 6" firm of independent certified
public accountants proposed by Operating Partnership and reasonably
acceptable to the General Partner, and the determination by that accounting
firm shall be final and binding on the parties. Promptly after that
determination, Operating Partnership shall deliver to the General Partner, as
agent for the Contributors, any additional Units payable as a result of the
determination. The fees and expenses of the accounting firm shall be borne
by Operating Partnership.
(d) An amount equal to the Specified Percentage of any amounts
collected by Operating Partnership after the Closing Date relating to the
period through the Closing Date with respect to refunds of real estate taxes
paid by 330 Madison (less any costs incurred by Operating Partnership in
obtaining such refunds and less any portion of such refunds required to be
paid to tenant) shall be promptly paid to the General Partner, as agent for
the Contributors, not later than 10 days after the end of the month in which
such amounts are collected.
(e) Prior to the close of business on the day preceding the Closing,
the General Partner shall cause the Partnership to satisfy any outstanding
liabilities and, subject to Section 2(b) hereof, to distribute all remaining
cash to its partners.
(f) A dispute currently exists between 330 Madison and BCCI (as such
term is defined in the Memorandum) as to the outstanding principal amount of
330 Madison's indebtedness to BCCI (the "BCCI Indebtedness"). Within 10 days
after the BCCI Indebtedness is repaid, Operating Partnership shall pay to the
General Partner, as agent for the Contributors, the amount to which the
Contributors are entitled, as set forth in the Memorandum, with respect to
the resolution of the dispute with respect to the amount of the BCCI
Indebtedness.
3. ACCEPTANCE OF CONTRIBUTIONS. Operating Partnership hereby agrees that
at the Closing it shall accept the Contributions and shall assume any and all
rights, obligations and responsibilities of Contributors as owners of the
Contributed Interests that arise from and after the Closing Date.
4. CLOSING TIME AND PLACE. Unless another date or place is agreed to by
the parties, the closing of the Contributions (the "Closing") shall take
place contemporaneously with the closing of the Consolidation and the
Offering at the offices of Proskauer ▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇ LLP, ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or such other place and time as Operating
Partnership and the General Partner shall agree upon, upon the satisfaction
or waiver of all conditions to the Closing set forth in Section 7 hereof.
5. REPRESENTATIONS AND WARRANTIES OF OPERATING PARTNERSHIP. Operating
Partnership hereby represents and warrants to Contributors as follows, which
representations and warranties shall be true and correct on the Closing Date:
5.1 ORGANIZATION, POWER AND AUTHORITY, AND QUALIFICATION. Operating
Partnership is a limited partnership duly organized, validly existing and in
good standing under the laws of the State of Delaware. The REIT is a
corporation duly organized, validly existing and in good standing under the
laws of its state of incorporation. Each of Operating Partnership and the
REIT has the requisite power and authority to carry on its respective
business as it is now being conducted. Each of Operating Partnership and the
REIT is qualified to do business and is in good standing in each jurisdiction
in which the character of its property owned or leased or the nature of its
activities makes such qualification necessary, except where the failure to be
so qualified and in good standing would not have a material adverse effect on
the business or financial condition of Operating Partnership or the REIT, as
the case may be.
5.2 AUTHORITY RELATIVE TO THIS AGREEMENT. Operating Partnership has
taken all action necessary to authorize the execution, delivery and
performance of this Agreement by
4
Operating Partnership and no other proceedings on the part of Operating
Partnership are necessary to authorize the execution and delivery of this
Agreement and the consummation of the Contributions.
None of the execution and delivery of this Agreement by Operating
Partnership, the consummation by Operating Partnership of the Contributions
or compliance by Operating Partnership with any of the provisions hereof
shall (i) conflict with or result in any breach of any provisions of the
Partnership Agreement of Operating Partnership; (ii) result in a violation or
breach of, or constitute (with or without due notice or lapse of time or
both) a default (or give rise to any right of termination, cancellation or
acceleration) under any of the terms, conditions or provisions of any note,
bond, mortgage, indenture, lease, license, contract, agreement or other
instrument or obligation to which Operating Partnership is a party or by
which it or any of its properties or assets may be bound; or (iii) violate
any order, writ, injunction, decree, statute, rule or regulation applicable
to Operating Partnership; except in the case of (ii) or (iii) for violations,
breaches, or defaults (A) that would not in the aggregate have a material
adverse effect on the business or financial condition of Operating
Partnership or the REIT, and that shall not impair the effectiveness of the
Contributions contemplated hereby, or (B) for which waivers or consents have
been or shall be obtained prior to the Closing Date.
5.3 BINDING OBLIGATION. This Agreement has been duly and validly
executed and delivered by Operating Partnership and constitutes a valid and
binding agreement of Operating Partnership, enforceable against Operating
Partnership in accordance with its terms, except that such enforcement may be
subject to bankruptcy, conservatorship, receivership, insolvency, moratorium,
or similar laws affecting creditors' rights generally or the rights of
creditors of limited partnerships and to general principles of equity.
5.4 INSOLVENCY. There are no attachments, executions or assignments for
the benefit of creditors, or voluntary or involuntary proceedings in
bankruptcy, or under any other debtor relief laws, contemplated by or pending
or threatened against Operating Partnership.
5.5 BROKERS. Neither Operating Partnership nor the REIT has employed or
dealt with any broker or finder, or incurred any liability therefor, in
connection with the Contributions.
5.6 VALID CONSIDERATION. The Units, when issued in accordance with this
Agreement and the Operating Agreement of Operating Partnership, shall be duly
and validly issued, fully paid and nonassessable, and the issuance thereof
shall not be subject to preemptive or other similar rights.
6. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF CONTRIBUTORS. Each
Contributor, in his, her or its capacity as a partner of the Partnership,
hereby represents and warrants to and agrees with Operating Partnership with
respect to his, her or its Contributed Interests as follows, which
representations and warranties shall be true and correct on the Closing Date:
6.1 TITLE; AUTHORITY TO ASSIGN. Contributor (i) owns good and
marketable, legal and beneficial title in and to his, her or its Contributed
Interests which are held or by the Closing Date shall be held free of liens,
encumbrances, judgments, adverse interests, pledges and security interests,
other than any such interests in the Contributed Interests granted pursuant
to the Operating Agreement of the Partnership, (ii) holds the entire right,
title and interest in and to his, her or its Contributed Interests, and (iii)
has the full right, power, capacity and authority to validly contribute and
convey his, her or its Contributed Interests pursuant to this Agreement.
5
6.2 NO BREACH OF OPERATING AGREEMENT. None of the execution and delivery
of this Agreement by Contributor, the consummation by Contributor of the
Contributions or compliance by Contributor with any of the provisions hereof
shall as of the Closing Date conflict with or result in any breach of any
provisions of the Operating Agreement of the Partnership or any other
agreement to which Contributor is a party.
6.3 INSOLVENCY. There are no attachments, executions or assignments for
the benefit of creditors, or voluntary or involuntary proceedings in
bankruptcy, or under any other debtor relief laws, contemplated by or pending
or, to the knowledge of Contributor, threatened against Contributor.
6.4 LITIGATION. Contributor has no knowledge of any actual or pending
litigation or proceeding by any organization, person, individual or
governmental agency against Contributor with respect to or against or
potentially affecting his, her or its Contributed Interests.
6.5 BINDING OBLIGATION, ETC. This Agreement has been duly and validly
executed and delivered by Contributor to Operating Partnership and
constitutes a legal, valid and binding agreement of Contributor, enforceable
against Contributor in accordance with its terms, except as such enforcement
may be limited by bankruptcy, conservatorship, receivership, insolvency,
moratorium or similar laws affecting creditors' rights generally and to
general principles of equity. Contributor further represents and warrants
that if Contributor is a corporation, partnership, trust or other entity, it
has the power to, and is duly authorized and otherwise duly qualified to,
purchase and hold securities such as Units and shares of Common Stock and
such entity has its principal place of business as set forth on Exhibit A.
6.6 BROKERS. Contributor has not employed or dealt with any broker or
finder, or incurred any liability therefor, in connection with the
Contributions.
6.7 SECURITIES ACT AND OTHER REPRESENTATIONS AND AGREEMENTS.
(a)(i) Upon the issuance of Units to Contributor, Contributor shall
become subject to, and shall be bound by, the terms and provisions of the
Partnership Agreement of Operating Partnership, including the terms of the
power of attorney contained in Section 15.11 thereof, as the Partnership
Agreement may be amended and restated from time to time in accordance with
its terms.
(ii) Contributor or his, her or its advisor(s) have had a
reasonable opportunity to ask questions of and receive information and
answers from a person or persons acting on behalf of the Partnership
concerning the Consolidation, and, as Contributor may deem necessary, to
verify the information contained in the Memorandum, receipt of which is
acknowledged, and any other information provided to Contributor by the
Partnership or Operating Partnership and all such questions have been
answered and all such information has been provided to the full satisfaction
of Contributor.
(iii) Contributor is acquiring Units for his, her or its own
account as principal, for investment and not with a view to resale or
distribution, that the shares of Common Stock of the REIT which may be
obtained upon redemption of the Units may not be transferred or otherwise
disposed of by Contributor otherwise than in transactions pursuant to the
registration statement required to be filed by the Partnership with respect
to such shares of Common Stock or that are exempt from the registration
requirements of the Securities Act of 1933 (the "Securities Act") and all
applicable state and foreign securities laws, and that the REIT may refuse to
transfer
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any shares of Common Stock as to which evidence of such registration or
exemptions from such registration satisfactory to the REIT is not provided to
it.
(iv) Contributor has sufficient knowledge and experience in
financial, tax and business matters to enable them to evaluate the merits and
risks of an investment in the Units. Contributor has the ability to bear the
economic risk of acquiring the Units. Contributor acknowledges that (1) the
transactions contemplated by this Agreement and the Memorandum involve
complex tax consequences for each Contributor and each Contributor is relying
solely on the advice of their own tax advisors in evaluating such
consequences, and (2) neither Operating Partnership nor the General Partner
has made (or shall be deemed to have made) any representations or warranties
as to the tax consequences of such transaction to any Contributor. Each
Contributor remains solely responsible for all tax matters relating to each
Contributor.
(v) If needed, Contributor has discussed with his, her or its
professional, legal, tax or financial advisors the suitability of an
investment in Units or shares of Common Stock for his, her or its particular
tax and financial situation. Nothing contained herein or in the Memorandum
shall be deemed to imply any representation by Operating Partnership or the
General Partner as to a particular tax effect that may be obtained by any
Contributor. All information that Contributor has provided to Operating
Partnership concerning himself or herself or itself and his, her or its
financial position is correct and complete as of the date hereof, and if
there should be any material change in such information prior to issuance of
Units to the partners, he, she or it shall immediately provide such changed
information to Operating Partnership.
(vi) Contributor has not disclosed any information contained in the
Memorandum to anyone other than his or her spouse or his, her or its
professional, legal, tax or financial advisors advising him, her or it in
connection with this investment and has not reproduced the Memorandum other
than for the use of such advisors.
(b) STATUS AS A UNITED STATES PERSON. (i) Unless otherwise
indicated on the Partner Consent, Contributor certifies that Contributor is
not a foreign person within the meaning of Section 1445 of the Internal
Revenue Code ("Section 1445"). To the extent that Contributor is not a
foreign person within the meaning of Section 1445, (1) Contributor's U.S.
taxpayer identification number that has previously been provided to the
Partnership is accurate, (2) Contributor's home address (in the case of an
individual) or office address (in the case of an entity) is that address
indicated on Exhibit A of this Agreement and (3) if Contributor subsequently
becomes a foreign person within the meaning of Section 1445, Contributor
shall notify Operating Partnership within sixty (60) days of doing so.
(ii) If Contributor is a foreign person within the meaning of
Section 1445, Operating Partnership shall withhold ten percent (10%) of the
amount realized (as such term is defined in Section 1001 of the Internal
Revenue Code) by Contributor in connection with the Contributions, unless
Operating Partnership shall receives from Contributor a notice of
nonrecognition transfer with respect to the Contributions by Contributor (in
a form to be provided by Operating Partnership).
(c) INDEMNIFICATION. Contributor hereby agrees to indemnify and
hold harmless the Partnership, the REIT, Operating Partnership and the
General Partner and any of the employees, agents, officers, directors and
affiliated persons of the foregoing from any and all damages, losses, costs
and expenses (including reasonable attorneys' fees) which they, or any of
them, may incur by reason of a failure by Contributor to fulfill any of the
terms and conditions of
7
this Agreement or by reason of the breach by Contributor of any of the
representations and warranties contained herein.
(d) WAIVER AND CONTRIBUTION. Contributor understands that (i) the Units
to be issued pursuant to the Consolidation have not been registered under the
Securities Act and (ii) the failure to register such Units could result in
Contributor being granted certain rights under the Federal securities laws,
including a right to rescind Contributor's consent to the Consolidation. For
the benefit of Operating Partnership, and in consideration of Operating
Partnership's consummating the Consolidation, Contributor (x) hereby waives
any and all rights he or she now has or may hereafter be granted to rescind
his or her consent to the Consolidation on the basis that the Units issued in
connection with the Consolidation were not registered (the "Waiver") and (y)
agrees that if the Waiver is deemed void or unenforceable for any reason,
including, without limitation, under Section 14 of the Securities Act, the
entire beneficial interest in all property and amounts received by
Contributor in any action to rescind the Consolidation (regardless of whether
such action was initiated by Contributor) or otherwise received by
Contributor as damages for failure to register the Units under the Securities
Act, shall be promptly paid over and contributed by Contributor to Operating
Partnership, for no additional consideration from Operating Partnership,
other than the Units originally issued pursuant to the Consolidation.
Whenever the context shall require, all words in the male, female or
neuter gender shall be deemed to include the other genders, all singular
words shall include the plural, and all plural words shall include the
singular. All representations, covenants and agreements of Contributor set
forth in this Agreement shall survive the consummation of the Consolidation
contemplated by the Memorandum.
7. CONDITIONS TO COMPLETION. In addition to the conditions to
completion of the Consolidation set forth in the Memorandum, the obligations
of Operating Partnership to consummate the transactions contemplated by this
Agreement shall be subject to fulfillment (or waiver by Operating
Partnership) at or prior to the Closing of the following conditions:
7.1 REPRESENTATIONS, WARRANTIES AND COVENANTS. The representations,
warranties and covenants made by Contributors in this Agreement or in any
document delivered by any of them pursuant to this Agreement shall be true
and correct in all material respects when made and on and as of the Closing
as though such representations, warranties and covenants were made on and as
of such date.
7.2 ACTIONS AFFECTING CONTRIBUTED INTERESTS. Contributors shall not
have sold, assigned, leased, pledged, transferred or encumbered any of the
Contributed Interests, or entered into any other consent, commitment,
understanding or other agreement, or have incurred any material obligation or
liability (contingent or absolute) with respect to the Contributed Interests.
7.3 NO MATERIAL ADVERSE CHANGE. There shall have been no material
adverse change in the value or condition of the Partnership or the Property
since the date hereof, except for changes resulting from the operation of the
Partnership in the ordinary course of business consistent with past practice
or as otherwise contemplated by the Memorandum, in each case that do not have
a material adverse effect on the business or financial condition of the
Partnership.
7.4 CONSENTS. Any and all consents required by the Operating Agreement
of the Partnership, and any certificates, agreements, contribution and
assumption instruments and other documents necessary or advisable to evidence
the conveyance of the Contributed Interests and
8
the admission of Operating Partnership (or Designated Subsidiary) into the
Partnership by virtue of the contribution of the Contributed Interests, shall
have been obtained.
7.5 NO ORDER OR INJUNCTION. The consummation of the Contributions shall
not have been restrained, enjoined or prohibited by any order or injunction
of any court or governmental authority of competent jurisdiction.
7.6 CONSOLIDATION. In addition to the consents set forth in Section 7.4
above, all conditions to the closing of the Consolidation set forth in the
underwriting agreement with respect to the Offering shall have been satisfied
on terms satisfactory to Operating Partnership and the General Partner.
8. THE CLOSING.
8.1 CONTRIBUTORS' CLOSING DOCUMENTS. At Closing, each Contributor shall
deliver (or cause to be delivered pursuant to the Power of Attorney referred
to in Section 11.9) or the General Partner shall deliver the following (all
of which shall be duly executed and acknowledged where required):
(a) A written document of conveyance contributing to Operating
Partnership (and/or any Designated Subsidiary) title to Contributor's
Contributed Interests, free and clear of any adverse claim or interest;
(b) Such documents and certificates as Operating Partnership
reasonably may require to establish the authority of the parties executing
any documents in connection with the Contributions;
(c) Such consents and instruments of admission as contemplated by
Section 7.4 hereof; and
(d) Such other documents, instruments and certificates as Operating
Partnership and the General Partner, as agent for the Contributors,
reasonably agree are necessary or appropriate, including without limitation
recording and transfer forms and affidavits.
8.2 OPERATING PARTNERSHIP'S CLOSING DOCUMENTS. At Closing, Operating
Partnership shall deliver or cause to be delivered to the General Partner, as
agent for the Contributors, the following:
(a) The Units; and
(b) Such other documents and instruments as the General Partner, as
agent for the Contributors, and Operating Partnership agree are necessary or
appropriate, including without limitation recording and transfer forms and
affidavits.
9. CLOSING COSTS. Operating Partnership shall pay or provide for the
payment of all other costs associated with the closing of the Contributions
of the Contributed Interests pursuant to this Agreement, as described in the
Memorandum.
10. OPERATION IN THE ORDINARY COURSE. The General Partner shall use
reasonable efforts to operate the Partnership and the Property in the
ordinary course of business between the date hereof and the closing of the
Consolidation, including making any necessary
9
capital expenditures and leasing expenditures consistent with past practices
to maintain the quality and value of the Property.
11. GENERAL PROVISIONS.
11.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. It is the express
intention and agreement of the parties hereto that the representations and
warranties of the parties set forth in this Agreement shall survive the
consummation of the Contributions and the Closing.
11.2 NOTICES. All notices, demands, requests or other communications
that may be or are required to be given or made by any party to the other
parties pursuant to this Agreement shall be in writing and shall be hand
delivered or transmitted by certified mail, express overnight mail or
delivery service, telegram, telex or facsimile transmission to the parties at
the addresses specified in Exhibit A or such other address as the addressee
may indicate by written notice to the other party.
Each notice, demand, request or communication that is given or made in
the manner described above shall be deemed sufficiently given or made for all
purposes at such time as it is delivered to the addressee (with the delivery
receipt, the affidavit of messenger or (with respect to a telex) the answer
back being deemed conclusive but not exclusive evidence of such delivery) or
at such time as delivery is refused by the addressee upon presentation.
11.3 GOVERNING LAW. This Agreement, the rights and obligations of the
parties hereto and any claims or disputes relating to such rights and
obligations shall be governed by and construed under the laws of the State of
New York.
11.4 HEADINGS. Section and subsection headings contained in this
Agreement are inserted for convenience of reference only, shall not be deemed
to be a part of this Agreement for any purpose, and shall not in any way
define or affect the meaning, construction or scope of any of the provisions
hereof.
11.5 BENEFIT AND ASSIGNMENT. No Contributor shall assign this Agreement,
in whole or in part, whether by operation of law or otherwise, without the
prior written consent of Operating Partnership. Any purported assignment
contrary to the terms hereof shall be null, void and of no force and effect.
This Agreement shall be binding upon and shall inure to the benefit of
the parties hereto and their respective successors and assigns as permitted
hereunder. No person or entity other than the parties hereto is or shall be
entitled to bring any action to enforce any provision of this Agreement
against any of the parties hereto, and the covenants and agreements set forth
in this Agreement shall be solely for the benefit of, and shall be
enforceable only by, the parties hereto or their respective successors and
assigns as permitted hereunder.
The Operating Partnership may designate one or more Designated
Subsidiaries to acquire all or any part of the Contributed Interests (in
which case the Designated Subsidiary shall execute a certificate at closing
making the same representations and warranties as are made by Operating
Partnership and references to Operating Partnership shall include the
Designated Subsidiaries except where the context clearly indicates otherwise).
11.6 SEVERABILITY. If any part of any provision of this Agreement or any
other agreement, document or writing given pursuant to or in connection with
this Agreement shall be invalid or unenforceable under applicable law, such
part shall be ineffective to the extent of such
10
invalidity or unenforceability only, without in any way affecting the
remaining parts of such provisions or the remaining provisions of said
agreement so long as the economic and legal substance of the Contributions is
not affected in any manner materially adverse to either party.
11.7 ENTIRE AGREEMENT; AMENDMENT. The Schedules and the Exhibits attached
hereto are hereby incorporated into the Agreement as if fully set forth
herein. This Agreement, and the Schedules and Exhibits attached hereto (each
of which shall be deemed incorporated herein and made a part hereof),
together with the Memorandum, contain the final and entire agreement between
the parties hereto with respect to the Contributions, supersede all prior
oral and written memoranda and agreements with respect to the matters
contemplated herein, and are intended to be an integration of all prior
negotiations and understandings. Contributors and Operating Partnership
shall not be bound by any terms, conditions, statements, warranties or
representations, oral or written, not contained or referred to herein or
therein. No change or modification of this Agreement shall be valid unless
the same is in writing and signed by the parties hereto.
11.8 NO WAIVER. No delay or failure on the part of any party hereto in
exercising any right, power or privilege under this Agreement or under any
other instrument or document given in connection with or pursuant to this
Agreement shall impair any such right, power or privilege or be construed as
a waiver of any default or any acquiescence therein. No single or partial
exercise of any such right, power or privilege shall preclude the further
exercise of such right, power or privilege. No waiver shall be valid against
any party hereto unless made in writing and signed by the party against whom
enforcement of such waiver is sought and then only to the extent expressly
specified therein.
11.9 CONSENT AND POWER OF ATTORNEY. The General Partner hereby consents
to the contribution of the Contributed Interests pursuant hereto by each of
the Contributors. Each Contributor is executing a Partner Consent pursuant
to which such Contributor (a) is executing this Agreement, and (b) is
consenting to each matter set forth therein. In addition, by executing this
Agreement pursuant to the Consent, each Contributor is constituting and
appointing each of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇▇▇▇ ▇.
▇▇▇▇, individually, with full power of substitution, the true and lawful
attorney-in-fact (the "Attorney") of such Contributor, with full power and
authority in the name of and for and on behalf of such Contributor, to
execute an instrument of conveyance contributing his, her or its Contributed
Interests to Operating Partnership pursuant to the Consolidation on the terms
set forth in the Memorandum, to execute the Partnership Agreement of
Operating Partnership and the Registration Rights Agreement (as such term is
defined in the Memorandum) and to execute any other instruments that the
General Partner reasonably determines necessary or appropriate in connection
with the contribution of the Contributed Interests pursuant to this Agreement.
Each Contributor shall promptly notify the General Partner if any of the
representations and warranties by that partner were not true and correct when
made or become untrue at any time prior to the Closing.
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IN WITNESS WHEREOF, each of the Contributors has executed a separate
Partner Consent agreeing to be bound by the terms of the Agreement and each
of Operating Partnership, and the General Partner has caused this Agreement
to be duly executed and delivered on its or his behalf as of the date first
above written.
THE MENDIK COMPANY, L.P.
By: Mendik Group, Inc.
By: ________________________________
Name:
Title:
THE MENDIK PARTNERSHIP, L.P.
By: ________________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, general partner
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