SALE AGREEMENT
BETWEEN
METROPOLITAN LIFE INSURANCE COMPANY,
a New York corporation,
AS SELLER,
AND
CORPORATE REALTY INCOME FUND I, L.P.,
a Delaware limited partnership,
AS PURCHASER
As of November 13, 1996
Re: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
TABLE OF CONTENTS
Page #
ARTICLE I PURCHASE AND SALE
Section 1.1 Agreement of Purchase and Sale.............................
Section 1.2 Property Defined...........................................
Section 1.3 Purchase Price.............................................
Section 1.4 Payment of Purchase Price..................................
Section 1.5 Deposit....................................................
ARTICLE II TITLE AND SURVEY
Section 2.1 Existing Title And Survey Matters..........................
Section 2.2 Pre-Closing "Gap" Title Defects............................
Section 2.3 Permitted Exceptions.......................................
Section 2.4 Conveyance of Title........................................
ARTICLE III REVIEW OF PROPERTY
Section 3.1 Right of Inspection........................................
Section 3.2 Reports....................................................
Section 3.3 Review of Tenant Estoppels.................................
ARTICLE IV CLOSING
Section 4.1 Time and Place.............................................
Section 4.2 Seller's Obligations at Closing............................
Section 4.3 Purchaser's Obligations at Closing.........................
Section 4.4 Credits and Prorations.....................................
Section 4.5 Transaction Taxes and Closing Costs........................
Section 4.6 Conditions Precedent to Obligation of
Purchaser..................................................
Section 4.7 Conditions Precedent to Obligation of
Seller.....................................................
ARTICLE V REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 5.1 Representations and Warranties of
Seller.....................................................
Section 5.2 Knowledge Defined..........................................
Section 5.3 Survival of Seller's Representations and
Warranties.................................................
Section 5.4 Covenants of Seller........................................
Section 5.5 Representations and Warranties of
Purchaser..................................................
Section 5.6 Survival of Purchaser's Representations
and Warranties.............................................
ARTICLE VI DEFAULT
Section 6.1 Default by Purchaser.......................................
Section 6.2 Default by Seller..........................................
Section 6.3 Recoverable Damages........................................
ARTICLE VII RISK OF LOSS
Section 7.1 Minor Damage...............................................
Section 7.2 Major Damage...............................................
Section 7.3 Definition of "Major" Loss or Damage.......................
Section 7.4 Section 5-1311 of the New York
General Obligations Law....................................
ARTICLE VIII COMMISSIONS
Section 8.1 Brokerage Commissions......................................
ARTICLE IX DISCLAIMERS AND WAIVERS
Section 9.1 No Reliance on Documents...................................
SECTION 9.2 AS-IS SALE; DISCLAIMERS....................................
Section 9.3 Survival of Disclaimers....................................
ARTICLE X MISCELLANEOUS
Section 10.1 Confidentiality............................................
Section 10.2 Public Disclosure..........................................
Section 10.3 Assignment.................................................
Section 10.4 Notices....................................................
Section 10.5 Modifications..............................................
Section 10.6 Entire Agreement...........................................
Section 10.7 Further Assurances.........................................
Section 10.8 Counterparts...............................................
Section 10.9 Severability...............................................
Section 10.10 Applicable Law.............................................
Section 10.11 No Third-Party Beneficiary.................................
Section 10.12 Captions...................................................
Section 10.13 Construction...............................................
Section 10.14 Recordation................................................
ARTICLE XI ▇▇▇▇▇▇-▇▇▇▇▇▇, INC. INDEMNITY
Section 11.1 Indemnity..................................................
Section 11.2 Purchaser's Obligation to Defend and
Pay........................................................
Section 11.3 Seller's Right to Participate..............................
Section 11.4 Release and Dismissal with Prejudice.......................
Section 11.5 Limited and Temporary License..............................
Section 11.6 Costs......................................................
Section 11.7 Survival...................................................
Exhibits
A DESCRIPTION OF LAND
B LIST OF PERSONAL PROPERTY
C LIST OF OPERATING AGREEMENTS
D LIST OF WARRANTIES AND GUARANTIES
E LIST OF PERMITS
F LIST OF REPORTS
G FORM OF TENANT ESTOPPEL CERTIFICATE
H FORM OF DEED
I FORM OF ▇▇▇▇ OF SALE
J FORM OF ASSIGNMENT OF LEASES
K FORM OF ASSIGNMENT OF CONTRACTS
L FORM OF TENANT NOTICE
M FORM OF FIRPTA CERTIFICATE
N LIST OF CERTAIN TENANT COSTS AND COMMISSIONS
O-1 COPY OF AGREEMENT, DATED AS OF FEBRUARY 15, 1995
O-2 COPY OF STIPULATION OF SETTLEMENT, DATED SEPTEMBER 5,
1995
P RENT ROLL
Q LIST OF SPECIFIED LITIGATION
Q-1 LIST OF TENANT EVICTION PROCEEDINGS, TENANT BANKRUPTCIES,
AND PROCEEDINGS FOR THE COLLECTION OF DELINQUENT RENTALS
FROM TENANTS
R LIST OF VIOLATIONS
S COPY OF RAUSMAN LEASE DOCUMENTS
T COPY OF ▇▇▇▇▇▇-▇▇▇▇▇▇, INC. SUMMONS AND COMPLAINT
SALE AGREEMENT
THIS SALE AGREEMENT (this "Agreement") is made as of this 13th day of
November, 1996 (the "Effective Date"), by and between METROPOLITAN LIFE
INSURANCE COMPANY ("Seller"), a New York corporation, and CORPORATE REALTY
INCOME FUND I, L.P. ("Purchaser"), a Delaware limited partnership.
W I T N E S S E T H:
ARTICLE I
PURCHASE AND SALE
Section 1.1 Agreement of Purchase and Sale. Subject to the terms and
conditions hereinafter set forth, Seller agrees to sell and convey to Purchaser,
and Purchaser agrees to purchase from Seller, the following:
(a) that certain tract or parcel of land situated in the City, County and
State of New York, known as and by street address ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, and more
particularly described in Exhibit A attached hereto and made a part hereof,
together with all rights and appurtenances pertaining to such property,
including any right, title and interest of Seller in and to adjacent streets,
alleys or rights-of-way (the property described in clause (a) of this Section
1.1 being herein referred to collectively as the "Land");
(b) the buildings, structures, fixtures and other improvements affixed to
or located on the Land, excluding fixtures owned by tenants (the property
described in clause (b) of this Section 1.1 being herein referred to
collectively as the "Improvements");
(c) any and all of Seller's right, title and interest in and to all
tangible personal property located upon the Land or within the Improvements,
including, without limitation, any and all appliances, furniture, carpeting,
draperies and curtains, tools and supplies, and other items of personal property
owned by Seller (excluding cash and any software), located on and used
exclusively in connection with the operation of the Land and the Improvements,
which personal property includes, without limitation, the personal property
listed on Exhibit B attached hereto (the property described in clause (c) of
this Section 1.1 being herein referred to collectively as the "Personal
Property");
(d) any and all of Seller's right, title and interest in and to the leases,
licenses and occupancy agreements covering all or any portion of the Real
Property (as such term is defined in Section 1.2 hereof), to the extent they are
in effect on the date of the Closing (as such term is defined in Section 4.1
hereof) (the property described in clause (d) of this Section 1.1 being herein
referred to collectively as the "Leases"), together with all rents and other
sums due thereunder (the "Rents") and any and all security deposits in Seller's
possession in connection therewith (the "Security Deposits"); and
(e) any and all of Seller's right, title and interest in and to (i) all
assignable contracts and agreements (collectively, the "Operating Agreements")
listed and described on Exhibit C attached hereto and made a part hereof,
relating to the upkeep, repair, maintenance or operation of the Land, the
Improvements or the Personal Property; and (ii) all assignable existing
warranties and guaranties (express or implied) issued to Seller in connection
with the Improvements or the Personal Property listed and described on Exhibit D
attached hereto and made a part hereof; and (iii) all assignable existing
permits, licenses, approvals and authorizations issued by any governmental
authority in connection with the Property (as such term is defined in Section
1.2 hereof) listed and described on Exhibit E attached hereto and made a part
hereof (the property described in clause (e) of this Section 1.1 being sometimes
herein referred to collectively as the "Intangibles").
Section 1.2 Property Defined. The Land and the Improvements are hereinafter
sometimes referred to collectively as the "Real Property." The Real Property,
the Personal Property, the Leases and the Intangibles are hereinafter sometimes
referred to collectively as the "Property."
Section 1.3. Purchase Price. Seller is to sell and Purchaser is to purchase
the Property for the sum of Twenty-Six Million Five Hundred Seventy Thousand and
00/100 Dollars ($26,570,000.00) (the "Purchase Price").
Section 1.4 Payment of Purchase Price. The Purchase Price, as increased or
decreased by prorations and adjustments as herein provided, shall be payable in
full at Closing in cash by wire transfer of immediately available funds to a
bank account designated by Seller in writing to Purchaser prior to the Closing.
Section 1.5 Deposit. Simultaneously with the execution and delivery of this
Agreement, Purchaser is depositing with Seller the sum of Three Million and
00/100 Dollars ($3,000,000.00) (the "Deposit") in good funds, either by
certified bank or cashier's check or by federal wire transfer. Seller shall hold
the Deposit in escrow in an interest-bearing account in The Chase Manhattan Bank
(or its successor-in-interest). Seller shall have no liability for any losses
incurred as a result of such investment of the Deposit, as aforesaid, and/or for
any failure or insolvency of the bank or depository in which the Deposit is so
invested. All interest on such sum shall be deemed income of Purchaser, and
Purchaser shall be responsible for the payment of all costs and fees imposed on
the Deposit account. The Deposit and all accrued interest shall be distributed
in accordance with the terms of this Agreement. The failure of Purchaser to
timely deliver the Deposit shall be a material default, and shall entitle
Seller, at Seller's sole option, to terminate this Agreement immediately.
2
ARTICLE II
TITLE
Section 2.1 Existing Title And Survey Matters. Purchaser acknowledges and
agrees that: (a) Seller has furnished Purchaser, prior to the Effective Date,
with copies of: (i) that certain Certificate and Report of Title (the
"Certificate of Title"), dated August 8, 1996 (the "Title Inspection Date"), for
the Real Property prepared by Commonwealth Land Title Insurance Company (the
"Title Company"); and (ii) Seller's title insurance policies (the "Owner's Title
Policies"), each dated June 30, 1994, and issued by, respectively, the Title
Company (Policy Number NY9300122M), and by First American Title Insurance
Company of New York (Policy Number Y0035325); and (iii) a copy of Seller's
survey (the "Survey"), prepared by J. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, dated April 30, 1947 and
last redated by visual examination on May 31, 1994 by ▇▇▇▇▇▇▇ Surveying, P.C.,
for the Land and the Improvements; (b) Purchaser has had an opportunity, prior
to the Effective Date, to order its own title report and survey for the Land and
the Improvements; and (c) any and all matters (the "Existing Title And Survey
Matters") referred to, reflected in or disclosed by, the materials referred to
in the preceding sub-paragraphs (a)(i) through (iii), inclusive, have been
agreed to and accepted by Purchaser (including, but not limited to, any and all
exceptions to title set forth in Schedule B of the Certificate of Title and in
Schedule B of each of the Owner's Title Policies), and that, as of the Title
Inspection Date, Purchaser has approved the condition of title to the Real
Property. Notwithstanding the foregoing, Seller shall, prior to Closing,
effectuate the following with respect to the Existing Title and Survey Matters:
1. All judgments and liens noted in Item 9 of Schedule B of the Certificate
of Title shall be omitted as an exception to title from any owner's and
mortgagee's title insurance policy issued at the Closing, and at Closing, Seller
shall deliver to the Title Company, Purchaser and Purchaser's lender an
indemnification agreement in form, scope and substance sufficient to omit said
Item 9 and reasonably acceptable to Seller, (and which indemnification agreement
shall be freely assignable by Purchaser and Purchaser's lender) indemnifying and
holding the Title Company, Purchaser and Purchaser's lender (and Purchaser's and
Purchaser's lender's respective successors and assigns) harmless from and
against any and all judgments and liens noted in said Item 9.
2. All judgments noted in Item 10 of Schedule B of the Certificate of Title
shall be omitted as an exception to title from any owner's and mortgagee's title
insurance policy issued at the Closing, and at Closing, Seller shall deliver to
the Title Company, Purchaser and Purchaser's lender an indemnification agreement
in form, scope and substance sufficient to omit said Item 10 and reasonably
acceptable to Seller, (and which indemnification agreement shall be freely
assignable by Purchaser and Purchaser's lender) indemnifying and holding the
Title Company, Purchaser and Purchaser's lender (and Purchaser's and Purchaser's
lender's
3
respective successors and assigns) harmless from and against any and all
judgments noted in said Item 10.
3. Item No. 19 shall be omitted as an exception to title from any owner's
and mortgagee's title insurance policy issued at the Closing.
4. Seller shall deliver at Closing such affidavits as may be customarily
and reasonably required by the Title Company, in a form reasonably acceptable to
Seller, including, but not limited to, those specific affidavits required by
Schedule B of the Certificate of Title in order that Items 15, 16, 17 and 25
shall be omitted as exceptions from any owner's and mortgagee's title insurance
policy issued at the Closing.
5. Subject to adjustment as herein provided, all open taxes, assessments,
vault charges and other similar charges noted and set forth in the Existing
Title and Survey Matters shall be satisfied in full at or prior to Closing.
6. All violations of federal, state, New York City, municipal and local
laws, regulations, ordinances, permits and the like noted and set forth in the
Existing Title and Survey Matters shall be cured prior to Closing, except for
(a) those certain violations noted as Items 1 and 2 on Exhibit R attached hereto
(the "Violations"), regarding which Seller shall attempt to cure prior to
Closing; provided, however, (i) Seller shall not be obligated to cure the
Violations as a condition to Closing; (ii) the failure by Seller to cure the
Violations on or before Closing shall not be a default of Seller's obligations
under this Agreement; and (ii) if Seller fails to cure the Violations on or
before Closing, Seller shall not be obligated to continue to attempt to cure the
Violations (but Seller (at no cost to Seller) shall reasonably cooperate with
Purchaser to effectuate such cure); and (b) that certain violation noted as Item
3 on Exhibit R attached hereto.
7. Seller shall deliver at Closing such affidavit as may be customarily and
reasonably required by the Title Company, in a form reasonably acceptable to
Seller, regarding tenants referenced in Item 2 of Schedule B of the Certificate
of Title.
The Existing Title and Survey Matters, as modified, cured and affected
hereinabove, shall be referred to as the "Acceptable Title Matters").
Section 2.2 Pre-Closing "Gap" Title Defects. Purchaser may, at or prior to
Closing, notify Seller in writing (the "Gap Notice") of any objections to title
not disclosed by the Title Company or otherwise known to Purchaser on or before
the Title Inspection Date; provided that Purchaser must notify Seller of such
objection to title within two (2) business days of being made aware of the
existence of such exception. If Purchaser sends a Gap Notice to Seller, Seller
shall notify Purchaser within five (5) business days thereafter whether Seller,
at Seller's option, shall either (a) remove such objectionable exceptions from
title on or
4
before the Closing; provided that Seller may extend the Closing for such period
as shall be required to effect such cure, but not beyond thirty (30) days; or
(b) not cause such exceptions to be removed. If Seller does not notify Purchaser
with said five (5) business day period, Seller shall be deemed to have elected
not to cause such objectionable exceptions from title. The procurement by Seller
of a commitment for the issuance of the Title Policy (as defined in Section 2.4
hereof) shall be deemed a cure by Seller of such objections set forth in the Gap
Notice. If Seller gives Purchaser notice under clause (b) above, Purchaser shall
have five (5) business days (but in all events must do so at or prior to the
Closing) in which to notify Seller that Purchaser will nevertheless proceed with
the purchase and take title to the Property subject to such exceptions, or that
Purchaser will terminate this Agreement. If this Agreement is terminated
pursuant to the foregoing provisions of this paragraph, then neither party shall
have any further rights or obligations hereunder (except for any indemnity
obligations of either party pursuant to the other provisions of this Agreement
other than the obligations set forth in Article 11 hereof, which shall void and
thereupon of no force or effect), the Deposit shall be returned to Purchaser and
each party shall bear its own costs incurred hereunder. If Purchaser shall fail
to notify Seller of its election within said five (5) business day period,
Purchaser shall be deemed to have elected to proceed with the purchase and take
title to the Property subject to such exceptions.
Section 2.3 Permitted Exceptions. The Property shall be conveyed subject to
the following matters, which are hereinafter referred to as the "Permitted
Exceptions":
(a) each and all of the Acceptable Title Matters;
(b) matters that either are not objected to in writing within the time
periods provided in Sections 2.2, or if objected to in writing by Purchaser, are
those which Seller has elected not to remove or cure, or has been unable to
remove or cure, and subject to which Purchaser has elected or is deemed to have
elected to accept the conveyance of the Property;
(c) the rights of tenants under the Leases as tenants only;
(d) the lien of all ad valorem real estate taxes and assessments not yet
due and payable as of the date of Closing, subject to adjustment as herein
provided; and
(e) local, state and federal laws, ordinances or governmental regulations,
including but not limited to, building and zoning laws, ordinances and
regulations, now or hereafter in effect relating to the Property.
Section 2.4 Conveyance of Title. At Closing, Seller shall convey and
transfer to Purchaser fee simple title to the Land and the Improvements, by
execution and delivery of the Deed (as defined in Section 4.2(a) hereof).
Evidence of delivery of such title
5
shall be the issuance by the Title Company of a 1992 ALTA Owner's Policy of
Title Insurance (the "Title Policy") covering the Real Property, in the full
amount of the Purchase Price, subject only to the Permitted Exceptions.
ARTICLE III
REVIEW OF PROPERTY
Section 3.1 Right of Inspection. Purchaser acknowledges and agrees that it
has had an opportunity, prior to the Effective Date, to make any and all
physical and other inspections of the Property as Purchaser has deemed necessary
and/or appropriate in connection with the transaction contemplated by this
Agreement, and that Purchaser has agreed, subject to the provisions of Article
VII hereof, to accept the Property at the Closing in the condition that exists
on the Effective Date, reasonable wear and tear excepted. Purchaser shall have
the right to further inspect the Property within the two (2) day period
immediately preceding the Closing (during normal business hours and upon notice
to Seller) for the sole purpose of confirming that the Property is in the same
condition at the Closing as existed on the Effective Date, reasonable wear and
tear excepted, as aforesaid.
Section 3.2 Reports. PURCHASER ACKNOWLEDGES THAT (1) PURCHASER HAS RECEIVED
COPIES OF THE REPORTS LISTED ON EXHIBIT F ATTACHED HERETO, (2) IF SELLER
DELIVERS ANY ADDITIONAL REPORTS TO PURCHASER, PURCHASER WILL ACKNOWLEDGE IN
WRITING THAT IT HAS RECEIVED SUCH REPORTS PROMPTLY UPON RECEIPT THEREOF, AND (3)
ANY REPORTS DELIVERED OR TO BE DELIVERED BY SELLER OR ITS AGENTS OR CONSULTANTS
TO PURCHASER ARE BEING MADE AVAILABLE SOLELY AS AN ACCOMMODATION TO PURCHASER
AND MAY NOT BE RELIED UPON BY PURCHASER IN CONNECTION WITH THE PURCHASE OF THE
PROPERTY. PURCHASER AGREES THAT SELLER SHALL HAVE NO LIABILITY OR OBLIGATION
WHATSOEVER FOR ANY INACCURACY IN OR OMISSION FROM ANY REPORT. PURCHASER
ACKNOWLEDGES AND AGREES THAT IT HAS CONDUCTED, PRIOR TO THE EFFECTIVE DATE, ITS
OWN INVESTIGATION OF THE CONDITION OF THE PROPERTY TO THE EXTENT PURCHASER
DEEMED SUCH AN INVESTIGATION TO BE NECESSARY OR APPROPRIATE, AND PURCHASER HAS
APPROVED OF THE CONDITION OF THE PROPERTY.
Section 3.3 Review of Tenant Estoppels. Within five (5) days of the
Effective Date, Seller shall deliver to each tenant of the Property an estoppel
certificate in substantially the form of Exhibit G attached hereto (the "Tenant
Estoppels") and shall request that the tenants complete and sign the Tenant
Estoppels and return them to Seller; provided, however, Purchaser acknowledges
that each tenant shall only be obligated to return an estoppel certificate as
set forth in said tenant's lease. Seller shall deliver copies of the completed
Tenant Estoppels to Purchaser as Seller receives them and deliver the originals
thereof to Purchaser at the Closing. Purchaser shall notify Seller within three
(3) business days of receipt of any Tenant Estoppel in the event Purchaser
determines such Tenant Estoppel is not reasonably acceptable to Purchaser along
with the reasons for such determination. In the event Purchaser fails to give
such notice
6
within such three (3) business day period then any such Tenant Estoppel shall be
deemed to be acceptable to Purchaser. In the event that Seller fails to obtain
the Tenant Estoppels or at a minimum, estoppel certificates containing the
information required under said tenants' leases (or in lieu thereof (except for
▇▇▇▇▇ & ▇▇▇▇▇), at Seller's option, Seller estoppels therefor in the form of the
Tenant Estoppel set forth in Exhibit G for not more than ten (10%) percent of
the currently occupied space at the Property as of the Effective Date) that are
reasonably satisfactory to Purchaser on or before three (3) business days prior
to Closing from (a) ▇▇▇▇▇ & ▇▇▇▇▇ and (b) those tenants occupying at least sixty
(60%) percent of the rentable square feet of the Property (which shall include
the rentable square feet occupied by ▇▇▇▇▇ & ▇▇▇▇▇), in the aggregate, then
Purchaser shall have the right to terminate this Agreement by written notice to
Seller. If this Agreement is terminated pursuant to the foregoing provisions of
this paragraph, then neither party shall have any further rights or obligations
hereunder (except for any indemnity obligations of either party pursuant to the
other provisions of this Agreement other than the obligations set forth in
Article 11 hereof, which shall void and thereupon of no force or effect), the
Deposit shall be returned to Purchaser and each party shall bear its own costs
incurred hereunder. If Purchaser fails to give Seller a notice of termination as
set forth above, Purchaser shall be deemed to have approved the Tenant Estoppels
(and Seller estoppels, if applicable) and to have elected to proceed with the
purchase of the Property pursuant to the terms hereof. Except as otherwise
provided in the succeeding sentence, the representations and warranties set
forth in any Seller estoppels shall survive the Closing for a period of one (1)
year and Seller's liability to Purchaser for a breach of any representation or
warranty set forth in any Seller estoppels shall be subject to Section 5.3
hereof. Any Tenant Estoppel which is received from a tenant after Seller
provides its own estoppel may be substituted for Seller's estoppel and Seller
shall have no further liability thereunder, provided that such Tenant Estoppel
contains no changes or, if changed, is otherwise reasonably acceptable to
Purchaser. The provisions of this Section 3.4 shall survive the Closing.
ARTICLE IV
CLOSING
Section 4.1 Time and Place. The consummation of the transaction
contemplated hereby (the "Closing") shall be held at the offices of Seller
located at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ on December 4, 1996,
at 9:30 A.M. At the Closing, Seller and Purchaser shall perform the obligations
set forth in, respectively, Section 4.2 and Section 4.3 hereof, the performance
of which obligations shall be concurrent conditions; provided that the Deed
shall not be recorded until Seller receives confirmation that Seller has
received the full amount of the Purchase Price, adjusted by prorations as set
forth herein.
Section 4.2 Seller's Obligations at Closing. At Closing, Seller shall:
7
(a) deliver to Purchaser a duly executed Bargain and Sale Deed without
Covenants Against Grantor's Acts (the "Deed") in the form attached hereto as
Exhibit H, conveying the Land and the Improvements, subject only to the
Permitted Exceptions. Subject to the terms of this Agreement, at Seller's
option, and for convenience, Seller may omit from the Deed the recital of any or
all of the "subject to" clauses concerning the Permitted Exceptions, but the
same shall nevertheless survive the Closing. The terms of the immediately
preceding sentence shall survive the Closing;
(b) deliver to Purchaser a duly executed ▇▇▇▇ of sale (the "▇▇▇▇ of Sale")
conveying the Personal Property without warranty of title or use and without
warranty, express or implied, as to merchantability and fitness for any purpose
and in the form attached hereto as Exhibit I;
(c) assign to Purchaser, and Purchaser shall assume, the landlord/lessor
interest in and to the Leases, Rents and Security Deposits, and any and all
obligations to pay leasing commissions and finder's fees with respect to the
Leases and amendments, renewals and expansions thereof, to the extent provided
in Section 4.4(b)(v) hereof, by duly executed assignment and assumption
agreement (the "Assignment of Leases") in the form attached hereto as Exhibit J
pursuant to which Purchaser shall indemnify Seller and hold Seller harmless from
and against any and all claims pertaining thereto arising from and after the
Closing, including without limitation, claims made by tenants with respect to
tenants' Security Deposits to the extent paid, credited or assigned to
Purchaser;
(d) to the extent assignable, assign to Purchaser, and Purchaser shall
assume, Seller's interest in the Operating Agreements and the other Intangibles
by duly executed assignment and assumption agreement (the "Assignment of
Contracts") in the form attached hereto as Exhibit K pursuant to which Purchaser
shall indemnify Seller and hold Seller harmless from and against any and all
claims pertaining thereto arising from and after the Closing;
(e) join with Purchaser to execute a notice (the "Tenant Notice") in the
form attached hereto as Exhibit L, which Purchaser shall send to each tenant
under each of the Leases promptly after the Closing, informing such tenant of
the sale of the Property and of the assignment to Purchaser of Seller's interest
in, and obligations under, the Leases (including, if applicable, any Security
Deposits), and directing that all Rent and other sums payable after the Closing
under each such Lease be paid as set forth in the notice;
(f) In the event that any representation or warranty of Seller needs to be
modified due to changes since the Effective Date, deliver to Purchaser a
certificate, dated as of the date of Closing and executed on behalf of Seller by
a duly authorized officer thereof, identifying any representation or warranty
which is not, or no longer is, true and correct and explaining the state
8
of facts giving rise to the change. In no event shall Seller be liable to
Purchaser for, or be deemed to be in default hereunder by reason of, any breach
of representation or warranty which results from any change that (i) occurs
between the Effective Date and the date of Closing, and (ii) is expressly
permitted under the terms of this Agreement or is beyond the reasonable control
of Seller to prevent; provided, however, that the occurrence of a change which
is not permitted hereunder or is beyond the reasonable control of Seller to
prevent shall, if materially adverse to Purchaser, constitute the
non-fulfillment of the condition set forth in Section 4.6(b) hereof; if, despite
changes or other matters described in such certificate, the Closing occurs,
Seller's representations and warranties set forth in this Agreement shall be
deemed to have been modified by all statements made in such certificate;
(g) deliver to Purchaser such evidence as the Title Company may reasonably
require as to the authority of the person or persons executing documents on
behalf of Seller;
(h) deliver to Purchaser a certificate in the form attached hereto as
Exhibit M duly executed by Seller stating that Seller is not a "foreign person"
as defined in the Federal Foreign Investment in Real Property Tax Act of 1980;
(i) deliver to Purchaser the Leases and the Operating Agreements, together
with such leasing and property files and records located at the Property or the
property manager's office in connection with the continued operation, leasing
and maintenance of the Property, but excluding Seller's corporate records,
internal memoranda, financial projections, budgets, appraisals, accounting and
tax records and similar proprietary, confidential or privileged information. For
a period of three (3) years after the Closing, Purchaser shall allow Seller and
its agents and representatives access without charge to all files, records and
documents delivered to Purchaser at the Closing, upon reasonable advance notice
and at all reasonable times, to examine and make copies of any and all such
files, records and documents, which right shall survive the Closing;
(j) deliver to Purchaser the originals of those of the Tenant Estoppels
returned to Seller by the tenants at the Property;
(k) deliver such affidavits as may be customarily and reasonably required
by the Title Company, in a form reasonably acceptable to Seller;
(l) deliver to Purchaser possession and occupancy of the Property, subject
to the Permitted Exceptions;
(m) execute a closing statement acceptable to Seller; and
(n) deliver such additional documents as shall be reasonably required to
consummate the transaction contemplated by this Agreement.
9
Section 4.3 Purchaser's Obligations at Closing. At Closing, Purchaser
shall:
(a) pay to Seller the full amount of the Purchase Price (which amount shall
include the Deposit), as increased or decreased by prorations and adjustments as
herein provided, in immediately available wire transferred federal funds
pursuant to Section 1.4 hereof;
(b) join Seller in the execution of the Assignment of Leases, the
Assignment of Contracts and the Tenant Notices;
(c) In the event that any representation or warranty of Purchaser set forth
in Sections 5.5(a) or (b) hereof needs to be modified due to changes since the
Effective Date, deliver to Seller a certificate, dated as of the date of Closing
and executed on behalf of Purchaser by a duly authorized representative thereof,
identifying any such representation or warranty which is not, or no longer is,
true and correct and explaining the state of facts giving rise to the change. In
no event shall Purchaser be liable to Seller for, or be deemed to be in default
hereunder by reason of, any breach of representation or warranty set forth in
Sections 5.5(a) or (b) hereof which results from any change that (i) occurs
between the Effective Date and the date of Closing, and (ii) is expressly
permitted under the terms of this Agreement or is beyond the reasonable control
of Purchaser to prevent; provided, however, that the occurrence of a change
which is not permitted hereunder or is beyond the reasonable control of
Purchaser to prevent shall, if materially adverse to Seller, constitute the
non-fulfillment of the condition set forth in Section 4.7(c) hereof; if, despite
changes or other matters described in such certificate, the Closing occurs,
Purchaser's representations and warranties set forth in this Agreement shall be
deemed to have been modified by all statements made in such certificate;
(d) deliver to Seller such evidence as the Title Company may reasonably
require as to the authority of the person or persons executing documents on
behalf of Purchaser;
(e) deliver such affidavits as may be customarily and reasonably required
by the Title Company, in a form reasonably acceptable to Purchaser;
(f) execute a closing statement acceptable to Purchaser; and
(g) deliver such additional documents as shall be reasonably required to
consummate the transaction contemplated by this Agreement.
10
Section 4.4 Credits and Prorations.
(a) All income and expenses of the Property shall be apportioned as of
12:01 a.m., on the day of Closing, as if Purchaser were vested with title to the
Property during the entire day upon which Closing occurs. Such prorated items
shall include without limitation the following:
(i) all Rents, if any;
(ii) taxes and assessments (including personal property taxes on the
Personal Property) levied against the Property;
(iii) utility charges for which Seller is liable, if any, such charges
to be apportioned at Closing on the basis of the most recent meter reading
occurring prior to Closing (dated not more than fifteen (15) days prior to
Closing) or, if unmetered, on the basis of a current ▇▇▇▇ for each such
utility;
(iv) all amounts payable under Operating Agreements, pursuant to the
terms of this Agreement;
(v) any other operating expenses or other items pertaining to the
Property which are customarily prorated between a purchaser and a seller in
the county in which the Property is located; and
(vi) a credit in the sum of $77,025.00 in consideration for the
obligations of Purchaser set forth in Article 11 hereof.
(b) Notwithstanding anything contained in Section 4.4(a) hereof:
(i) At Closing, (A) Seller shall, at Seller's option, either deliver
to Purchaser any Security Deposits actually held by Seller pursuant to the
Leases or credit to the account of Purchaser the amount of such Security
Deposits (to the extent such Security Deposits have not been applied
against delinquent Rents or otherwise as provided in the Leases), and (B)
Purchaser shall credit to the account of Seller all refundable cash or
other deposits posted with utility companies serving the Property, or, at
Seller's option, Seller shall be entitled to receive and retain such
refundable cash and deposits. Any Security Deposits in form other than cash
(including, but not limited to, any letters of credit) shall be transferred
to Purchaser by way of appropriate instruments of replacement, transfer or
assignment, the cost of which shall be borne by Purchaser;
(ii) Any taxes paid at or prior to Closing shall be prorated based
upon the amounts actually paid. If taxes and assessments due and payable
during the year of Closing have not been paid before Closing, Seller shall
be charged at Closing an amount equal to that portion of such taxes and
assessments which relates to the period before Closing and Purchaser shall
pay the taxes and assessments prior to their becoming delinquent. Any such
11
apportionment made with respect to a tax year for which the tax rate or
assessed valuation, or both, have not yet been fixed shall be based upon
the tax rate and/or assessed valuation last fixed. To the extent that the
actual taxes and assessments for the current year differ from the amount
apportioned at Closing, the parties shall make all necessary adjustments by
appropriate payments between themselves within thirty (30) days after such
amounts are determined following Closing, subject to the provisions of
Section 4.4(d) hereof;
(iii) Charges referred to in Section 4.4(a) hereof which are payable
by any tenant to a third party shall not be apportioned hereunder, and
Purchaser shall accept title subject to any of such charges unpaid and
Purchaser shall look solely to the tenant responsible therefor for the
payment of the same. As of the Effective Date, Seller has not paid any of
such charges on behalf of any tenant. However, if Seller (after obtaining
Purchaser's prior written consent, which consent shall not be unreasonably
withheld or delayed) shall pay any of such charges on behalf of any tenant
between the Effective Date and the Closing, and shall not have been
reimbursed therefor by the time of Closing, Purchaser shall credit to
Seller an amount equal to all such charges so paid by Seller;
(iv) As to utility charges referred to in Section 4.4(a)(iii) hereof,
Seller may on notice to Purchaser elect to pay one or more of all of said
items accrued to the date hereinabove fixed for apportionment directly to
the person or entity entitled thereto prior to the Closing, and to the
extent Seller so elects, such item shall not be apportioned hereunder;
(v) Purchaser shall be responsible for the payment of (A) all Tenant
Inducement Costs (as hereinafter defined) and leasing commissions which
become due and payable (whether before or after Closing) as a result of any
new Leases, or any renewals, amendments or expansions of existing Leases,
signed during the Lease Approval Period (as hereinafter defined) and, if
required, approved or deemed approved in accordance with Section 5.4
hereof; and (B) all Tenant Inducement Costs and leasing commissions with
respect to new Leases, or renewals, amendments or expansions of existing
Leases, signed or entered into from and after the date of Closing; and (C)
all Tenant Inducement Costs and leasing commissions listed on Exhibit N
attached hereto. If, as of the date of Closing, Seller shall have paid any
Tenant Inducement Costs or leasing commissions for which Purchaser is
responsible pursuant to the foregoing provisions, Purchaser shall reimburse
Seller therefor at Closing. For purposes hereof, the term "Tenant
Inducement Costs" shall mean any out-of-pocket payments required under a
Lease to be paid by the landlord thereunder to or for the benefit of the
tenant thereunder which is in the nature of a tenant inducement, including
specifically, without limitation, tenant improvement costs, lease buyout
costs, and moving, design, refurbishment and club membership allowances.
The term "Tenant Inducement Costs" shall not include loss of income
resulting from any free rental period, it being agreed that Seller shall
bear the
12
loss resulting from any free rental period until the date of Closing and
that Purchaser shall bear such loss from and after the date of Closing. For
purposes hereof, the term "Lease Approval Period" shall mean the period
from the Effective Date until the date of Closing;
(vi) Unpaid and delinquent Rent collected by Seller and Purchaser
after the date of Closing shall be delivered as follows: (a) if Seller
collects any unpaid or delinquent Rent for the Property, Seller shall,
within fifteen (15) days after the receipt thereof, deliver to Purchaser
any such Rent which Purchaser is entitled to hereunder relating to the date
of Closing and any period thereafter, and (b) if Purchaser collects any
unpaid or delinquent Rent from the Property, Purchaser shall, within
fifteen (15) days after the receipt thereof, deliver to Seller any such
Rent which Seller is entitled to hereunder relating to the period prior to
the date of Closing. Seller and Purchaser agree, on a tenant-by-tenant
basis, that (i) all Rent received by Seller or Purchaser within the first
ninety (90) day period after the date of Closing from a tenant of the
Property shall be applied first to delinquent Rent, if any, owed by said
tenant, in the order of their maturity, and then to current Rent owed by
said tenant, and (ii) all Rent received by Seller or Purchaser after the
first ninety (90) day period after the date of Closing shall be applied
first to current Rent owed by said tenant and then to delinquent Rent, if
any, owed by said tenant, in the inverse order of maturity. Purchaser will
make a good faith effort after Closing to collect all Rents in the usual
course of Purchaser's operation of the Property, but Purchaser will not be
obligated to institute any lawsuit or other collection procedures to
collect delinquent Rents. Seller may attempt to collect any delinquent
Rents owed Seller and may institute any lawsuit or collection procedures,
but may not evict any tenant. In the event that there shall be any Rents or
other charges under any Leases which, although relating to a period prior
to Closing, do not become due and payable until after Closing or are paid
prior to Closing but are subject to adjustment after Closing (such as year
end common area expense reimbursements and the like), then any Rents or
charges of such type received by Purchaser or its agents or Seller or its
agents subsequent to Closing shall, to the extent applicable to a period
extending through the Closing, be prorated between Seller and Purchaser as
of Closing and Seller's portion thereof shall be remitted promptly to
Seller by Purchaser. Notwithstanding anything contained in this Agreement
to the contrary, Seller shall be entitled to all unpaid or delinquent Rent
for the period prior to the Closing that is received by Seller or Purchaser
from ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ in connection with that certain Agreement, dated as
of February 15, 1995, a copy of which is attached hereto as Exhibit O-1,
and that certain Stipulation of Settlement, dated September 5, 1995, a copy
of which is attached hereto as Exhibit O-2.
(c) Seller has filed and may continue to prosecute an appeal of the real
property tax assessment for the 1996/1997 tax years (and prior years), and may
take related action which Seller deems appropriate in connection therewith.
Purchaser shall cooperate
13
with Seller in connection with such appeal and collection of a refund of real
property taxes paid. Seller owns and holds all right, title and interest in and
to such appeal and refund, and all amounts payable in connection therewith shall
be paid directly to Seller by the applicable authorities. If such refund or any
part thereof is received by Purchaser, Purchaser shall promptly pay such amount
to Seller. Any refund received by Seller shall be distributed as follows: first,
to reimburse Seller for all costs incurred in connection with the appeal;
second, with respect to refunds payable to tenants of the Real Property pursuant
to the Leases, to such tenants in accordance with the terms of such Leases; and
third, to Seller to the extent such appeal covers the period prior to the
Closing, and to Purchaser to the extent such appeal covers the period as of the
Closing and thereafter. If and to the extent any such appeal covers the period
after the Closing, Purchaser shall have the right to participate in such appeal.
(d) Except as otherwise provided herein, any revenue or expense amount
which cannot be ascertained with certainty as of Closing shall be prorated on
the basis of the parties' reasonable estimates of such amount, and shall be the
subject of a final proration within one hundred eighty (180) days after Closing,
or as soon thereafter as the precise amounts can be ascertained. Purchaser shall
promptly notify Seller when it becomes aware that any such estimated amount has
been ascertained. Once all revenue and expense amounts have been ascertained,
Purchaser shall prepare, and certify as correct, a final proration statement
which shall be subject to Seller's approval. Upon Seller's acceptance and
approval of any final proration statement submitted by Purchaser, such statement
shall be conclusively deemed to be accurate and final.
(e) Subject to the final sentence of Section 4.4(d) hereof, the provisions
of this Section 4.4 shall survive Closing.
Section 4.5 Transaction Taxes and Closing Costs.
(a) Seller and Purchaser shall execute such returns, questionnaires and
other documents as shall be required with regard to all applicable real property
transaction taxes imposed by applicable federal, state or local law or
ordinance;
(b) Seller shall pay the fees of any counsel representing Seller in
connection with this transaction. Seller shall also pay the following costs and
expenses:
(i) any transfer tax, sales tax, documentary stamp tax or similar tax
which becomes payable by reason of the transfer of the Property; and
(ii) the fees for the Broker (as hereinafter defined in Section 8.1
hereof).
14
(c) Purchaser shall pay the fees of any counsel representing Purchaser in
connection with this transaction. Purchaser shall also pay the following costs
and expenses:
(i) the fee for the title examination and any title commitments
obtained by Purchaser and the premium for the Title Policy to be issued to
Purchaser by the Title Company at Closing, and all endorsements thereto;
(ii) the cost of any surveys obtained by Purchaser; and
(iii) the fees for recording the Deed.
(d) The Personal Property is included in this sale without charge, except
that Purchaser shall pay to Seller the amount of any and all sales or similar
taxes payable in connection with the transfer of the Personal Property and
Purchaser shall execute and deliver any tax returns required of it in connection
therewith;
(e) All costs and expenses incident to this transaction and the closing
thereof, and not specifically described above, shall be paid by the party
incurring same; and
(f) The provisions of this Section 4.5 shall survive the Closing.
Section 4.6 Conditions Precedent to Obligation of Purchaser. The obligation
of Purchaser to consummate the transaction hereunder shall be subject to the
fulfillment on or before the date of Closing of all of the following conditions,
any or all of which may be waived by Purchaser in its sole discretion:
(a) Seller shall have delivered to Purchaser all of the items required to
be delivered to Purchaser pursuant to the terms of this Agreement, including but
not limited to, those provided for in Section 4.2 hereof;
(b) All of the representations and warranties of Seller contained in this
Agreement shall be true and correct in all respects as of the date of Closing
(with appropriate modifications permitted under this Agreement); and
(c) Purchaser shall have received the Tenant Estoppels described in, and as
required by, Section 3.3 hereof; and
(d) Seller shall have performed and observed all covenants and agreements
of this Agreement to be performed and observed by Seller as of the date of
Closing.
Section 4.7 Conditions Precedent to Obligation of Seller. The obligation of
Seller to consummate the transaction hereunder shall be subject to the
fulfillment on or before the date of Closing of all of the following conditions,
any or all of which may be waived by Seller in its sole discretion:
15
(a) Seller shall have received the Purchase Price as adjusted as provided
herein, pursuant to and payable in the manner provided for in this Agreement;
(b) Purchaser shall have delivered to Seller all of the items required to
be delivered to Seller pursuant to the terms of this Agreement, including but
not limited to, those provided for in Section 4.3 hereof;
(c) All of the representations and warranties of Purchaser contained in
this Agreement shall be true and correct in all material respects as of the date
of Closing (with appropriate modifications permitted under this Agreement); and
(d) Purchaser shall have performed and observed all covenants and
agreements of this Agreement to be performed and observed by Purchaser as of the
date of Closing.
ARTICLE V
REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 5.1 Representations and Warranties of Seller. Seller hereby makes
the following representations and warranties to Purchaser as of the Effective
Date, which representations and warranties shall be deemed to have been made
again as of the Closing, subject to Section 4.2(f) hereof:
(a) Organization and Authority. Seller has been duly organized and is
validly existing under the laws of the State of New York. Seller has the full
right and authority to enter into this Agreement and to transfer all of the
Property and to consummate or cause to be consummated the transaction
contemplated by this Agreement. The person signing this Agreement on behalf of
Seller is authorized to do so.
(b) Pending or Threatened Actions. To Seller's knowledge, Seller has not
received written notice of any action, suit, arbitration, unsatisfied order or
judgment, government investigation or proceeding pending or threatened against
Seller which, if adversely determined, could individually or in the aggregate
materially interfere with the consummation of the transaction contemplated by
this Agreement.
(c) Operating Agreements. To Seller's knowledge, the Operating Agreements
listed on Exhibit C are all of the agreements concerning the operation and
maintenance of the Property entered into by Seller and affecting the Property,
except those operating agreements that are not assignable or are to be
terminated by Seller within thirty (30) days after the Closing, and except any
agreement with Seller's property manager, which shall be terminated by Seller.
(d) Condemnation. To Seller's knowledge, Seller has received no written
notice of any condemnation proceedings relating to the Property.
16
(e) Leases. To Seller's knowledge, the rent roll attached hereto as Exhibit
P is accurate in all material respects, and lists all of the leases currently
affecting the Property.
(f) Litigation. To Seller's knowledge, except as set forth on Exhibit Q
attached hereto, and except tenant eviction proceedings, tenant bankruptcies,
and proceedings for the collection of delinquent rentals from tenants listed on
Exhibit Q-1 attached hereto, and except for proceedings related to claims for
personal injury or damage to property due to events occurring at the Property,
Seller has not received written notice of any litigation which has been filed
against Seller that arises out of the ownership of the Property and would
materially affect the Property or use thereof, or Seller's ability to perform
hereunder. To Seller's knowledge, in the event that there are any proceedings
related to claims for personal injury or damage to property due to events
occurring at the Property during the period of Seller's ownership of the
Property, such proceedings would be defended and satisfied by Seller's insurer.
(g) Violations. To Seller's knowledge, except as set forth on Exhibit R
attached hereto, Seller has not received written notice of any violation of any
federal, state or local law relating to the use or operation of the Property
which would materially adversely affect the Property or use thereof and which
has not been cured prior to the Effective Date.
Section 5.2 Knowledge Defined. References to the "knowledge" of Seller
shall refer only to the current actual knowledge of the Designated Employee (as
hereinafter defined in this Section 5.2) of Seller (after due inquiry of
Seller's property manager), and shall not be construed, by imputation or
otherwise, to refer to the knowledge of Seller or any affiliate of Seller, to
any property manager (except as otherwise set forth in this Section 5.2), or to
any other officer, agent, manager, representative or employee of Seller or any
affiliate thereof, or to impose upon such Designated Employee any duty to
investigate the matter to which such actual knowledge, or the absence thereof,
pertains (except as otherwise set forth in this Section 5.2). As used herein,
the term "Designated Employee" shall refer to ▇▇. ▇▇▇▇ ▇▇▇▇▇▇, Senior Investment
Analyst, Real Estate Investments Department, of Seller.
Section 5.3 Survival of Seller's Representations and Warranties. The
representations and warranties of Seller set forth in Section 5.1 hereof as
updated as of the Closing in accordance with the terms of this Agreement, shall
survive Closing for a period of one hundred eighty (180) days. No claim for a
breach of any representation or warranty of Seller shall be actionable or
payable if the breach in question results from or is based on a condition, state
of facts or other matter which was known to Purchaser prior to Closing. Seller
shall have no liability to Purchaser for a breach of any representation or
warranty (a) unless the valid claims for all such breaches collectively
aggregate more than Two Hundred Thousand Dollars ($200,000.00), in which event
the full amount of such valid claims shall be actionable, up to the Cap
17
(as defined in this Section), and (b) unless written notice containing a
description of the specific nature of such breach shall have been given by
Purchaser to Seller prior to the expiration of said one hundred eighty (180) day
period and an action shall have been commenced by Purchaser against Seller
within two hundred forty (240) days of Closing. Seller shall not be liable to
Purchaser if Purchaser's claim is satisfied from any insurance policies, service
contracts or Leases; provided, however, Purchaser shall not be required to
exhaust such other potential sources of remedies prior to seeking recovery from
Seller. As used herein, the term "Cap" shall mean the total aggregate amount of
Two Million and 00/100 Dollars ($2,000,000.00).
Section 5.4 Covenants of Seller. Seller hereby covenants with Purchaser as
follows:
(a) From the Effective Date hereof until the Closing or earlier termination
of this Agreement, Seller shall use reasonable efforts to operate and maintain
the Property in a manner generally consistent with the manner in which Seller
has operated and maintained the Property prior to the date hereof, including the
maintenance of full replacement insurance for the Property (less the value of
the Land); and
(b) Except as provided hereinbelow, a copy of any amendment, renewal or
expansion of an existing Lease (unless such renewal or expansion is pursuant to
the terms of an existing Lease) or of any new Lease which Seller wishes to
execute between the Effective Date and the date of Closing will be submitted to
Purchaser prior to execution by Seller. Purchaser agrees to notify Seller in
writing within five (5) business days after its receipt thereof of either its
approval or disapproval thereof, including all Tenant Inducement Costs and
leasing commissions to be incurred in connection therewith. In the event
Purchaser informs Seller within such five (5) business day period that Purchaser
does not approve the amendment, renewal or expansion of the existing Lease or
the new Lease, which approval shall not be unreasonably withheld, Seller shall
have the right to terminate this Agreement by written notice thereof to
Purchaser within five (5) business days after Seller's receipt of written notice
of Purchaser's disapproval thereof. If this Agreement is not terminated pursuant
to the foregoing provisions of this paragraph, then Seller shall not proceed
with such amendment, renewal or expansion of the existing Lease or the new
Lease. If this Agreement is terminated pursuant to the foregoing provisions of
this paragraph, then neither party shall have any further rights or obligations
hereunder (except for any indemnity obligations of either party pursuant to the
other provisions of this Agreement other than the obligations set forth in
Article 11 hereof, which shall void and thereupon of no force or effect), the
Deposit shall be returned to Purchaser and each party shall bear its own costs
incurred hereunder. In the event Purchaser fails to notify Seller in writing of
its approval or disapproval within the five (5) business day period set forth
above, Purchaser shall be deemed to have approved such new Lease, amendment,
renewal or expansion. At Closing, Purchaser shall
18
reimburse Seller for any Tenant Inducement Costs, leasing commissions or other
expenses, including legal fees, paid by Seller pursuant to an amendment, a
renewal, an expansion or a new Lease approved (or deemed approved) by Purchaser.
Section 5.5 Representations and Warranties of Purchaser. Purchaser hereby
makes the following representations and warranties to Seller as of the Effective
Date, which representations and warranties shall be deemed to have been made
again as of the Closing, subject to Section 4.3(c) hereof:
(a) Organization and Authority. Purchaser has been duly organized and is
validly existing under the laws of the State of Delaware. Purchaser has the full
right and authority to enter into this Agreement and to consummate or cause to
be consummated the transaction contemplated by this Agreement. The person
signing this Agreement on behalf of Purchaser is authorized to do so;
(b) Pending Actions. To Purchaser's knowledge, there is no action, suit,
arbitration, unsatisfied order or judgment, government investigation or
proceeding pending against Purchaser which, if adversely determined, could
individually or in the aggregate materially interfere with the consummation of
the transaction contemplated by this Agreement.
(c) ERISA. As of the Closing, (1) Purchaser will not be an employee benefit
plan as defined in Section 3(3) of the Employee Retirement Income Security Act
of 1974, as amended ("ERISA"), which is subject to Title I of ERISA, nor a plan
as defined in Section 4975(e)(1) of the Internal Revenue Code of 1986, as
amended (each of the foregoing hereinafter referred to collectively as "Plan"),
and (2) the assets of the Purchaser will not constitute "plan assets" of one or
more such Plans within the meaning of Department of Labor ("DOL") Regulation
Section 2510.3-101.
As of the Closing, if Purchaser is a "governmental plan" as defined in
Section 3(32) of ERISA, the closing of the sale of the Property will not
constitute or result in a violation of state or local statutes regulating
investments of and fiduciary obligations with respect to governmental plans.
As of the Closing, Purchaser will be acting on its own behalf and not on
account of or for the benefit of any Plan.
Purchaser has no present intent to transfer the Property to any entity,
person or Plan which will cause a violation of ERISA.
Purchaser shall not assign its interest under this Agreement to any entity,
person, or Plan which will cause a violation of ERISA.
Section 5.6 Survival of Purchaser's Representations and Warranties. The
representations and warranties of Purchaser set forth in Section 5.5 hereof as
updated as of the Closing in accordance with the terms of this Agreement, shall
survive Closing
19
for a period of one hundred eighty (180) days. Purchaser shall have no liability
to Seller for a breach of any representation or warranty unless written notice
containing a description of the specific nature of such breach shall have been
given by Seller to Purchaser prior to the expiration of said one hundred eighty
(180) day period and an action shall have been commenced by Seller against
Purchaser within two hundred forty (240) days of Closing.
ARTICLE VI
DEFAULT
Section 6.1 Default by Purchaser. In the event the sale of the Property as
contemplated hereunder is not consummated due to Purchaser's default hereunder,
Seller shall be entitled, as its sole remedy, to terminate this Agreement and
receive the Deposit as liquidated damages for the breach of this Agreement, it
being agreed between the parties hereto that the actual damages to Seller in the
event of such breach are impractical to ascertain and the amount of the Deposit
is a reasonable estimate thereof.
Section 6.2 Default by Seller. In the event the sale of the Property as
contemplated hereunder is not consummated due to Seller's default hereunder,
Purchaser shall be entitled, as its sole remedy, either (a) to receive the
return of the Deposit, which return shall operate to terminate this Agreement
(except for any indemnity obligations of either party pursuant to the other
provisions of this Agreement other than the obligations set forth in Article 11
hereof, which shall be void and thereupon of no force or effect) and release
Seller from any and all liability hereunder, except as otherwise expressly
provided in this clause (a), or (b) to enforce specific performance of Seller's
obligation to convey the Property to Purchaser in accordance with the terms of
this Agreement, it being understood and agreed that the remedy of specific
performance shall not be available to enforce any other obligation of Seller
hereunder. Purchaser expressly waives its rights to seek damages in the event of
Seller's default hereunder. Purchaser shall be deemed to have elected to
terminate this Agreement and receive back the Deposit if Purchaser fails to file
suit for specific performance against Seller in a court having jurisdiction in
the county and state in which the Property is located, on or before sixty (60)
days following the date upon which Closing was to have occurred.
Section 6.3 Recoverable Damages. Notwithstanding Sections 6.1 and 6.2
hereof, in no event shall the provisions of Sections 6.1 and 6.2 limit the
damages recoverable by either party against the other party due to the other
party's obligation to indemnify such party in accordance with this Agreement.
ARTICLE VII
RISK OF LOSS
Section 7.1 Minor Damage. In the event of loss or damage to the Property or
any portion thereof which is not "Major" (as hereinafter defined), this
Agreement shall remain in full force and
20
effect provided that Seller shall, at Seller's option, either (a) perform any
necessary repairs, or (b) assign to Purchaser, without representation, warranty
or recourse to Seller, all of Seller's right, title and interest in and to any
claims and proceeds Seller may have with respect to any net casualty insurance
policies or net condemnation awards relating to the premises in question (that
is, after expense of collection), subject however, to Seller's right to receive
reimbursement therefrom of any amounts paid or incurred by Seller for or on
account of any amounts paid or incurred by Seller for or on account of repairs
and/or restoration of the Property prior to Closing. In the event that Seller
elects to perform repairs upon the Property, Seller shall use reasonable efforts
to complete such repairs promptly and the date of Closing shall be extended a
reasonable time in order to allow for the completion of such repairs. If Seller
elects to assign a casualty claim to Purchaser, the Purchase Price shall be
reduced by an amount equal to the lesser of the deductible amount under Seller's
insurance policy or the cost of such repairs as determined in accordance with
Section 7.3 hereof. Upon Closing, full risk of loss with respect to the Property
shall pass to Purchaser.
Section 7.2 Major Damage. In the event of a "Major" loss or damage, either
Seller or Purchaser may terminate this Agreement by written notice to the other
party, in which event the Deposit shall be returned to Purchaser. If neither
Seller nor Purchaser elects to terminate this Agreement within ten (10) days
after Seller sends Purchaser written notice of the occurrence of such Major loss
or damage (which notice shall state the cost of repair or restoration thereof as
opined by an architect in accordance with Section 7.3 hereof), then Seller and
Purchaser shall be deemed to have elected to proceed with Closing, in which
event Seller shall, at Seller's option, either (a) perform any necessary
repairs, or (b) assign to Purchaser, without representation, warranty or
recourse to Seller, all of Seller's right, title and interest in and to any
claims and proceeds Seller may have with respect to any net casualty insurance
policies or net condemnation awards relating to the premises in question (that
is, after expense of collection), subject however, to Seller's right to receive
reimbursement therefrom of any amounts paid or incurred by Seller for or on
account of any amounts paid or incurred by Seller for or on account of repairs
and/or restoration of the Property prior to Closing. In the event that Seller
elects to perform repairs upon the Property, Seller shall use reasonable efforts
to complete such repairs promptly and the date of Closing shall be extended a
reasonable time in order to allow for the completion of such repairs. If Seller
elects to assign a casualty claim to Purchaser, the Purchase Price shall be
reduced by an amount equal to the lesser of the deductible amount under Seller's
insurance policy or the cost of such repairs as determined in accordance with
Section 7.3 hereof. Upon Closing, full risk of loss with respect to the Property
shall pass to Purchaser.
Section 7.3 Definition of "Major" Loss or Damage. For purposes of Sections
7.1 and 7.2, "Major" loss or damage refers to the following: (a) loss or damage
to the Property hereof such that the cost of repairing or restoring the premises
in question to
21
substantially the same condition which existed prior to the event of damage
would be, in the opinion of an architect selected by Seller and reasonably
approved by Purchaser, equal to or greater than Two Million and 00/100 Dollars
($2,000,000.00), and (b) any loss due to a condemnation which permanently and
materially impairs the current use of the Property. If Purchaser does not give
written notice to Seller of Purchaser's reasons for disapproving an architect
within five (5) business days after receipt of notice of the proposed architect,
Purchaser shall be deemed to have approved the architect selected by Seller.
Section 7.4 Section 5-1311 of the New York General Obligations Law. The
terms of this Article VII shall be deemed to be the terms of an agreement which
"expressly provides otherwise" within the meaning of Section 5-1311 of the New
York General Obligations Law.
22
ARTICLE VIII
COMMISSIONS
Section 8.1 Brokerage Commissions. With respect to the transaction
contemplated by this Agreement, Seller and Purchaser represent that the brokers
are The ▇▇▇▇▇▇▇▇▇ Company, L.P., CB Commercial Real Estate Group, Inc. and
▇▇▇▇▇▇ ▇▇▇▇▇ (collectively, the "Broker"). Each party hereto agrees that if any
person or entity, other than the Broker, makes a claim for brokerage commissions
or finder's fees related to the sale of the Property by Seller to Purchaser, and
such claim is made by, through or on account of any acts or alleged acts of said
party or its representatives, said party will protect, indemnify, defend and
hold the other party free and harmless from and against any and all loss,
liability, cost, damage and expense (including reasonable attorneys' fees) in
connection therewith. The provisions of this paragraph shall survive Closing or
any termination of this Agreement.
ARTICLE IX
DISCLAIMERS AND WAIVERS
Section 9.1 No Reliance on Documents. Except as expressly stated herein,
Seller makes no representation or warranty as to the truth, accuracy or
completeness of any materials, data or information delivered by Seller or its
brokers or agents to Purchaser in connection with the transaction contemplated
hereby. Purchaser acknowledges and agrees that all materials, data and
information delivered by Seller to Purchaser in connection with the transaction
contemplated hereby are provided to Purchaser as a convenience only and that any
reliance on or use of such materials, data or information by Purchaser shall be
at the sole risk of Purchaser, except as otherwise expressly stated herein.
Neither Seller, nor any affiliate of Seller, nor the person or entity which
prepared any report or reports delivered by Seller to Purchaser shall have any
liability to Purchaser for any inaccuracy in or omission from any such reports.
SECTION 9.2 AS-IS SALE; DISCLAIMERS. EXCEPT AS EXPRESSLY SET FORTH IN THIS
AGREEMENT, IT IS UNDERSTOOD AND AGREED THAT SELLER IS NOT MAKING AND HAS NOT AT
ANY TIME MADE ANY WARRANTIES OR REPRESENTATIONS OF ANY KIND OR CHARACTER,
EXPRESS OR IMPLIED, WITH RESPECT TO THE PROPERTY, INCLUDING, BUT NOT LIMITED TO,
ANY WARRANTIES OR REPRESENTATIONS AS TO HABITABILITY, MERCHANTABILITY OR FITNESS
FOR A PARTICULAR PURPOSE.
PURCHASER ACKNOWLEDGES AND AGREES THAT UPON CLOSING SELLER SHALL SELL AND
CONVEY TO PURCHASER AND PURCHASER SHALL ACCEPT THE PROPERTY "AS-IS, WHERE IS,
WITH ALL FAULTS", EXCEPT TO THE EXTENT EXPRESSLY PROVIDED OTHERWISE IN THIS
AGREEMENT. PURCHASER HAS NOT RELIED AND WILL NOT RELY ON, AND SELLER IS NOT
LIABLE FOR OR BOUND BY, ANY EXPRESS OR IMPLIED WARRANTIES, GUARANTIES,
STATEMENTS, REPRESENTATIONS OR INFORMATION PERTAINING TO THE PROPERTY OR
RELATING THERETO (INCLUDING SPECIFICALLY, WITHOUT LIMITATION, OFFERING PACKAGES
DISTRIBUTED WITH RESPECT TO THE PROPERTY) MADE OR
23
FURNISHED BY SELLER, THE MANAGERS OF THE PROPERTY, OR ANY REAL ESTATE BROKER OR
AGENT REPRESENTING OR PURPORTING TO REPRESENT SELLER, TO WHOMEVER MADE OR GIVEN,
DIRECTLY OR INDIRECTLY, ORALLY OR IN WRITING, UNLESS SPECIFICALLY SET FORTH IN
THIS AGREEMENT. PURCHASER ALSO ACKNOWLEDGES THAT THE PURCHASE PRICE REFLECTS AND
TAKES INTO ACCOUNT THAT THE PROPERTY IS BEING SOLD "AS-IS."
PURCHASER HEREBY ACKNOWLEDGES AND AGREES THAT NO REPRESENTATIONS,
WARRANTIES OR COVENANTS OF ANY KIND OR CHARACTER WHATSOEVER ARE OR WILL BE MADE
BY SELLER REGARDING THAT CERTAIN LEASE, DATED JANUARY, 1984, BETWEEN 41 FIFTH
ASSOCIATES, SELLER'S PREDECESSOR-IN-INTEREST, AND RAUSMAN ASSOCIATES, AS AMENDED
BY THAT CERTAIN AGREEMENT BETWEEN SAID PARTIES, DATED AS OF OCTOBER 25, 1984, OR
ANY GUARANTIES (IF ANY) OR CERTIFICATES (IF ANY) GIVEN IN CONNECTION THEREWITH
(SAID LEASE, AS AMENDED BY SAID AGREEMENT, TOGETHER WITH SAID GUARANTIES, IF
ANY, OR SAID CERTIFICATES, IF ANY, ARE HEREIN COLLECTIVELY REFERRED TO AS THE
"RAUSMAN LEASE DOCUMENTS"), OR THE EXISTENCE, VALIDITY OR BINDING EFFECT OF ANY
OF THE RAUSMAN LEASE DOCUMENTS AND/OR THE OCCUPANCY OR POSSESSION OF RAUSMAN
ASSOCIATES THEREUNDER OR IN ANY WAY RELATED THERETO. FURTHER, PURCHASER HEREBY
IRREVOCABLY RELEASES SELLER FROM ANY AND ALL LIABILITY TO PURCHASER ARISING FROM
OR RELATING TO THE MATTERS SET FORTH IN THE IMMEDIATELY PRECEDING SENTENCE.
NOTWITHSTANDING ANYTHING CONTAINED IN THIS AGREEMENT TO THE CONTRARY, PURCHASER
HEREBY ACKNOWLEDGES AND AGREES THAT THE PROPERTY SHALL BE CONVEYED TO PURCHASER
SUBJECT TO THE RAUSMAN LEASE DOCUMENTS AND/OR THE OCCUPANCY OR POSSESSION OF
RAUSMAN ASSOCIATES THEREUNDER OR IN ANY WAY RELATED THERETO. THE PROVISIONS OF
THIS PARAGRAPH SHALL SURVIVE THE CLOSING. A COPY OF SAID LEASE AND SAID
AGREEMENT ARE ATTACHED HERETO AS EXHIBIT S.
PURCHASER REPRESENTS TO SELLER THAT PURCHASER HAS CONDUCTED PRIOR TO THE
EFFECTIVE DATE SUCH INVESTIGATIONS OF THE PROPERTY, INCLUDING BUT NOT LIMITED
TO, THE PHYSICAL AND ENVIRONMENTAL CONDITIONS THEREOF, AS PURCHASER DEEMS
NECESSARY OR DESIRABLE TO SATISFY ITSELF AS TO THE CONDITION OF THE PROPERTY AND
THE EXISTENCE OR NONEXISTENCE OR CURATIVE ACTION TO BE TAKEN WITH RESPECT TO ANY
HAZARDOUS OR TOXIC SUBSTANCES ON OR DISCHARGED FROM THE PROPERTY, AND WILL RELY
SOLELY UPON SAME AND NOT UPON ANY INFORMATION PROVIDED BY OR ON BEHALF OF SELLER
OR ITS AGENTS OR EMPLOYEES WITH RESPECT THERETO, OTHER THAN SUCH
REPRESENTATIONS, WARRANTIES AND COVENANTS OF SELLER AS ARE EXPRESSLY SET FORTH
IN THIS AGREEMENT. UPON CLOSING, PURCHASER SHALL ASSUME THE RISK THAT ADVERSE
MATTERS, INCLUDING BUT NOT LIMITED TO, CONSTRUCTION DEFECTS AND ADVERSE PHYSICAL
AND ENVIRONMENTAL CONDITIONS, MAY NOT HAVE BEEN REVEALED BY PURCHASER'S
INVESTIGATIONS, AND PURCHASER, UPON CLOSING, SHALL BE DEEMED TO HAVE WAIVED,
RELINQUISHED AND RELEASED SELLER (AND SELLER'S OFFICERS, DIRECTORS,
SHAREHOLDERS, EMPLOYEES AND AGENTS) FROM AND AGAINST ANY AND ALL CLAIMS,
DEMANDS, CAUSES OF ACTION (INCLUDING CAUSES OF ACTION IN TORT), LOSSES, DAMAGES,
LIABILITIES, COSTS AND EXPENSES (INCLUDING REASONABLE ATTORNEYS' FEES) OF ANY
AND EVERY KIND OR CHARACTER, KNOWN OR UNKNOWN, WHICH PURCHASER MIGHT HAVE
ASSERTED OR ALLEGED AGAINST SELLER (AND SELLER'S OFFICERS, DIRECTORS,
SHAREHOLDERS, EMPLOYEES AND AGENTS) AT ANY TIME BY REASON OF OR ARISING OUT OF
ANY LATENT OR PATENT
24
CONSTRUCTION DEFECTS OR PHYSICAL CONDITIONS, VIOLATIONS OF ANY APPLICABLE LAWS
AND ANY AND ALL OTHER ACTS, OMISSIONS, EVENTS, CIRCUMSTANCES OR MATTERS
REGARDING THE PROPERTY.
Section 9.3 Survival of Disclaimers. The provisions of this Article IX
shall survive Closing or any termination of this Agreement.
ARTICLE X
MISCELLANEOUS
Section 10.1 Confidentiality. Purchaser and its representatives shall hold
in strictest confidence all data and information obtained with respect to Seller
or its business, whether obtained before or after the execution and delivery of
this Agreement, and shall not disclose the same to others; provided, however,
that it is understood and agreed that Purchaser may disclose such data and
information to the employees, lenders, consultants, accountants and attorneys of
Purchaser provided that such persons agree in writing to treat such data and
information confidentially. In the event this Agreement is terminated or
Purchaser fails to perform hereunder, Purchaser shall promptly return to Seller
any statements, documents, schedules, exhibits or other written information
obtained from Seller in connection with this Agreement or the transaction
contemplated herein. It is understood and agreed that, with respect to any
provision of this Agreement which refers to the termination of this Agreement
and the return of the Deposit to Purchaser, such Deposit shall not be returned
to Purchaser unless and until Purchaser has fulfilled its obligation to return
to Seller the materials described in the preceding sentence. In the event of a
breach or threatened breach by Purchaser or its agents or representatives of
this Section 10.1, Seller shall be entitled to an injunction restraining
Purchaser or its agents or representatives from disclosing, in whole or in part,
such confidential information. Nothing herein shall be construed as prohibiting
Seller from pursuing any other available remedy at law or in equity for such
breach or threatened breach. The provisions of this Section 10.1 shall survive
Closing or any termination of this Agreement.
Section 10.2 Public Disclosure. Prior to and after the Closing, no press
release or other public disclosure (except to the extent required by law,
including any filings required by the Securities and Exchange Commission and
communications with each of the limited partners of Purchaser) regarding the
purchase and sale as contemplated hereby will be issued or made by either party
without the prior written consent of both parties. The provisions of this
Section 10.2 shall survive the Closing or any termination of this Agreement.
Section 10.3 Assignment. Subject to the provisions of this Section 10.3,
the terms and provisions of this Agreement are to apply to and bind the
permitted successors and assigns of the parties hereto. Purchaser may not assign
its rights under this Agreement without first obtaining Seller's written
approval, which
25
approval may be given or withheld in Seller's sole discretion. Notwithstanding
the preceding sentence, so long as Purchaser satisfies all of the conditions of
this Section 10.3, the prior written approval of Seller shall not be required in
the event that Purchaser assigns its rights under this Agreement to any entity
controlled by Purchaser. For purposes of this Section 10.3, the phrase "control"
shall mean the ownership of sufficient equity or voting interests of a
corporation or similar entity to enable the holder thereof to elect a majority
of the directors (or persons performing similar functions) thereof and in the
case of a partnership or joint venture, the ownership of more than a 50%
interest in the profits or capital thereof. In the event Purchaser intends to
assign its rights hereunder, (a) Purchaser shall send Seller written notice
thereof at least ten (10) business days prior to Closing, which notice shall
include the legal name and structure of the proposed assignee, as well as any
other information that Seller may reasonably request, and (b) Purchaser and the
proposed assignee shall execute an assignment and assumption of this Agreement
in form and substance satisfactory to Seller, and (c) in no event shall any
assignment of this Agreement release or discharge Purchaser from any liability
or obligation hereunder. Any assignee permitted under this Section 10.3 shall
make and deliver in writing to Seller the same representations at Closing as are
made by Purchaser in this Agreement. Notwithstanding the foregoing, under no
circumstances shall Purchaser have the right to assign this Agreement to any
person or entity owned or controlled by an employee benefit plan if Seller's
sale of the Property to such person or entity would, in the reasonable opinion
of Seller's ERISA advisor, create or otherwise cause a "prohibited transaction"
under ERISA. Any transfer, directly or indirectly, of any stock, partnership
interest or other ownership interest in Purchaser shall constitute an assignment
of this Agreement. The provisions of this Section 10.3 shall survive the Closing
or any termination of this Agreement.
Section 10.4 Notices. Any notice pursuant to this Agreement shall be given
in writing by (a) personal delivery, (b) reputable overnight delivery service
with proof of delivery, (c) United States Mail, postage prepaid, registered or
certified mail, return receipt requested, or (d) legible facsimile transmission,
sent to the intended addressee at the address set forth below, or to such other
address or to the attention of such other person as the addressee shall have
designated by written notice sent in accordance herewith, and shall be deemed to
have been given upon receipt or refusal to accept delivery, or, in the case of
facsimile transmission, as of the date of the facsimile transmission provided
that an original of such facsimile is also sent to the intended addressee by
means described in clauses (a), (b) or (c) above. Unless changed in accordance
with the preceding sentence, the addresses for notices given pursuant to this
Agreement shall be as follows:
26
If to Seller: Metropolitan Life Insurance Company
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ - ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇ ▇▇▇▇▇▇
Senior Investment Analyst
Real Estate Investments
Telephone No. (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Metropolitan Life Insurance Company
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ - ▇▇▇▇ ▇-▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Attorney
Law Department
Real Estate Investments
Telephone No. (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
If to Purchaser:
Corporate Realty Income Fund I, L.P.
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
Telephone No. (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Telephone No. (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
Section 10.5 Modifications. This Agreement cannot be changed orally, and no
executory agreement shall be effective to waive, change, modify or discharge it
in whole or in part unless such executory agreement is in writing and is signed
by the parties against whom enforcement of any waiver, change, modification or
discharge is sought.
Section 10.6 Entire Agreement. This Agreement, including the exhibits and
schedules hereto, contains the entire agreement between the parties hereto
pertaining to the subject matter hereof and fully supersedes all prior written
or oral agreements and understandings between the parties pertaining to such
subject matter, other than any confidentiality agreement executed by Purchaser
in connection with the Property.
27
Section 10.7 Further Assurances. Each party agrees that it will execute and
deliver such other documents and take such other action, whether prior or
subsequent to Closing, as may be reasonably requested by the other party to
consummate the transaction contemplated by this Agreement. The provisions of
this Section 10.7 shall survive Closing.
Section 10.8 Counterparts. This Agreement may be executed in counterparts,
all such executed counterparts shall constitute the same agreement, and the
signature of any party to any counterpart shall be deemed a signature to, and
may be appended to, any other counterpart.
Section 10.9 Severability. If any provision of this Agreement is determined
by a court of competent jurisdiction to be invalid or unenforceable, the
remainder of this Agreement shall nonetheless remain in full force and effect;
provided that the invalidity or unenforceability of such provision does not
materially adversely affect the benefits accruing to any party hereunder.
Section 10.10 Applicable Law. This Agreement shall be governed by and
construed in accordance with the laws of the State in which the Property is
located. Seller and Purchaser agree that the provisions of this Section 10.10
shall survive the Closing or any termination of this Agreement.
Section 10.11 No Third-Party Beneficiary. The provisions of this Agreement
and of the documents to be executed and delivered at Closing are and will be for
the benefit of Seller and Purchaser only and are not for the benefit of any
third party, and accordingly, no third party shall have the right to enforce the
provisions of this Agreement or of the documents to be executed and delivered at
Closing.
Section 10.12 Captions. The section headings appearing in this Agreement
are for convenience of reference only and are not intended, to any extent and
for any purpose, to limit or define the text of any section or any subsection
hereof.
Section 10.13 Construction. The parties acknowledge that the parties and
their counsel have reviewed and revised this Agreement and that the normal rule
of construction to the effect that any ambiguities are to be resolved against
the drafting party shall not be employed in the interpretation of this Agreement
or any exhibits or amendments hereto.
28
Section 10.14 Recordation. This Agreement may not be recorded by any party
hereto without the prior written consent of the other party hereto. The
provisions of this Section 10.14 shall survive the Closing or any termination of
this Agreement.
ARTICLE 11
▇▇▇▇▇▇-▇▇▇▇▇▇, INC. INDEMNITY
Section 11.1 Indemnity. Purchaser shall protect, defend, indemnify and hold
harmless Seller from and against all Costs (as hereinafter defined) (other than
as contemplated in Section 11.3 hereof), which at any time may be imposed upon
and/or incurred by Seller arising out of or in connection with that certain
matter entitled ▇▇▇▇▇▇-▇▇▇▇▇▇, Inc. v. Metropolitan Life Insurance Company
(Index No. 96-119412, Supreme Court of the State of New York, County of New
York) (the "Lawsuit").
Section 11.2 Purchaser's Obligation to Defend and Pay. Purchaser agrees to
investigate, prosecute, negotiate and defend the Lawsuit on Seller's behalf (as
Purchaser shall reasonably determine), at Purchaser's sole cost and expense, and
to pay the amount of the Costs of any judgment or settlement arising out of or
in connection with the Lawsuit.
Section 11.3 Seller's Right to Participate. Notwithstanding anything to the
contrary contained in this Article 11, Seller, at Seller's sole cost and
expense, may, but shall not be obligated to, employ its own legal counsel and
consultants to investigate, prosecute, negotiate or defend the Lawsuit.
Section 11.4 Release and Dismissal with Prejudice. Purchaser agrees that in
connection with any settlement or compromise of the Lawsuit or consent to the
entry of any judgment Purchaser shall use reasonable efforts to obtain from the
plaintiff a full and complete written release of Seller and Purchaser from all
liability in respect of the Lawsuit and a dismissal with prejudice of the
Lawsuit.
Section 11.5 Limited and Temporary License. In the event that Seller
exercises Seller's right to participate in the Lawsuit as set forth in Section
11.3 hereof, then, subject to the rights of tenants under the Leases, Purchaser
hereby grants to Seller and Seller's agents a limited and temporary license,
upon reasonable prior to notice to Purchaser, to enter upon the premises that
are the subject of the Lawsuit for the sole purpose of performing investigations
reasonably appropriate to enable Seller to adequately prosecute, negotiate or
defend the Lawsuit. Such limited and temporary license shall commence upon the
date that Seller elects to participate in the Lawsuit as set forth in Section
11.3 hereof and provides Purchaser with written notice of such election, and
shall terminate immediately upon the final disposition of the Lawsuit. Seller
agrees to hold Purchaser harmless from any damages or liabilities arising by
reason of Seller's exercise of the limited and temporary license herein granted.
29
Section 11.6 Costs. The phrase "Costs" shall mean all liabilities, losses,
costs, damages, expenses, claims, attorneys' fees, experts' fees, consultants'
fees and disbursements of any kind or of any nature whatsoever.
Section 11.7 Survival. The provisions of this Article 11 shall survive the
Closing.
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as
of the Effective Date.
SELLER:
METROPOLITAN LIFE INSURANCE COMPANY,
a New York corporation
By: ______________________
Name: ▇▇▇▇▇▇ ▇▇▇▇▇
Title: Assistant Vice-President
PURCHASER:
CORPORATE REALTY INCOME FUND I, L.P.,
a Delaware limited partnership
By: ______________________
Name: ____________________
Title: ___________________
30
EXHIBIT A
DESCRIPTION OF LAND
EXHIBIT B
LIST OF PERSONAL PROPERTY
1 BEEPER
1 BOOK CASE
4 CCTV MONITORS
1 CHAIR
1 FAX MACHINE
4 HAND HELD RADIOS
2 TELEPHONES
7 CAMERAS
1 VCR
12 PLANTS
1 WATER COOLER
EXHIBIT C
LIST OF OPERATING AGREEMENTS
EXHIBIT D
LIST OF WARRANTIES AND GUARANTIES
NONE
EXHIBIT E
LIST OF PERMITS
EXHIBIT F
LIST OF ENVIRONMENTAL REPORTS
Report, dated May 30, 1996, from PSI Environmental Geotechnical Construction.
Report, dated May 24, 1994, from Kemron Environmental Services, Inc.
Property Conditions Report, dated October 30, 1996, from ▇▇▇▇▇▇▇ Consultants,
Inc.
EXHIBIT G
TENANT ESTOPPEL FORM
_____________, 1996
Corporate Realty Income Fund I, L.P.
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Metropolitan Life Insurance Company
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Re: Lease dated _________, 199_ (the "Lease") executed between
______________________________________________________________________________
("Landlord"), and ____________________________________________________________
("Tenant"), for those premises located at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇.
Gentlemen:
The undersigned Tenant understands that you or your assigns intend to
acquire fee title to that property located at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ (the "Property") from Metropolitan Life Insurance Company ("Metropolitan").
The undersigned Tenant does hereby certify to Metropolitan and to you as
follows:
A. Tenant has entered into a certain lease together with all amendments
(the "Lease") as described on Schedule 1 attached hereto.
B. The Lease is in full force and effect and has not been modified,
supplemented, or amended except as set forth on Schedule 1 attached hereto.
C. Tenant has not given Landlord written notice of any dispute between
Landlord and Tenant or that Tenant considers Landlord in default under the
Lease.
D. Tenant does not claim any offsets or credits against rents payable under
the Lease.
E. Tenant has not paid a security or other deposit with respect to the
Lease, except as follows: .
F. Tenant has fully paid rent to and including the month of ________, 199_.
G. Tenant has not paid any rentals in advance except for the current month
of ________________________, 199_.
H. The Lease expires on ____________________________.
I. Tenant has no options, rights of first offer or rights of
first refusal to purchase the Property, except as follows:
______________________________________________________________________________
______________________________________________________________________________
TENANT:
_________________________________
a _______________________________
By: _____________________________
Name: ___________________________
Title: __________________________
EXHIBIT H
BARGAIN AND SALE DEED
THIS INDENTURE, made the ___ day of December, 1996, between METROPOLITAN
LIFE INSURANCE COMPANY ("Grantor"), a New York corporation, having an address at
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, and CORPORATE REALTY INCOME FUND
I, L.P. ("Grantee"), a Delaware limited partnership, having an address at ▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇.
WITNESSETH, that Grantor, in consideration of Ten Dollars ($10.00) and
other valuable consideration paid by the Grantee, does hereby grant and release
unto Grantee, the heirs or successors and assigns of Grantee forever,
ALL that certain plot, piece or parcel of land, with the buildings and
improvements thereon erected, situate, lying and being commonly known as ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, and more particularly described in Schedule A
attached hereto and made a part hereof.
TOGETHER with all right, title and interest, if any, of Grantor in and to
any streets and roads abutting the above described premises to the center lines
thereof;
TOGETHER with the appurtenances and all the estate and rights of Grantor in
and to said premises;
TO HAVE AND TO HOLD the premises herein granted unto Grantee, the heirs or
successors and assigns of Grantee forever.
AND Grantor, in compliance with Section 13 of the Lien Law, covenants that
Grantor will receive the consideration for this conveyance and will hold the
right to receive such consideration as a trust fund to be applied first for the
purpose of paying the costs of the improvement and will apply the same first to
the payment of the cost of the improvement before using any part of the total of
the same for any other purpose.
IN WITNESS WHEREOF, Grantor has duly executed this Deed on the date first
set forth above.
IN PRESENCE OF: METROPOLITAN LIFE INSURANCE COMPANY
___________________________ By:_________________________________
Name: ▇▇▇▇▇▇ ▇▇▇▇▇
Title: Assistant Vice-President
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the day _____ December, 1996, before me personally came ▇▇▇▇▇▇ ▇▇▇▇▇, to
me known, who, being duly sworn, did depose and say that (s)he resides at
_____________________________; that (s)he is the Assistant Vice-President of
METROPOLITAN LIFE INSURANCE COMPANY, a New York corporation, the corporation
described in and which executed foregoing instrument; that (s)he knows the seal
of said corporation; that the seal affixed to said instrument is such corporate
seal; that it was so affixed by order of the board of directors of said
corporation; and that (s)he signed her name thereto by like order.
_________________________________
Notary Public
My commission expires on ________________.
================================================================================
BARGAIN AND SALE DEED
WITHOUT COVENANT AGAINST GRANTOR'S ACTS
from
METROPOLITAN LIFE INSURANCE COMPANY,
as Grantor,
to
CORPORATE REALTY INCOME FUND I, L.P.,
as Grantee
================================================================================
Section: 5
Block: 1275
Lot: 69
County: New York
Address: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
Please record and return to:
▇▇▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Schedule A
Legal Description
EXHIBIT J
FORM OF ASSIGNMENT OF LEASES
THIS ASSIGNMENT OF LEASES (the "Assignment") is made as of this _____ day
of December, 1996, between METROPOLITAN LIFE INSURANCE COMPANY ("Assignor"), a
New York corporation, and CORPORATE REALTY INCOME FUND I, L.P. ("Assignee"), a
Delaware limited partnership.
For and in consideration of the sum of Ten Dollars ($10.00) and other
valuable consideration to it in hand paid by Assignee to Assignor, the
conveyance by Assignor to Assignee of all that certain real property being
particularly described on Schedule 1 attached hereto and incorporated herein by
this reference, more commonly known as ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, located in the City of
New York, County of New York, State of New York (the "Property"), and the mutual
covenants herein contained, the receipt and sufficiency of the foregoing
consideration being hereby acknowledged by the parties hereto, Assignor hereby
assigns, transfers, sets over and conveys to Assignee all of Assignor's right,
title and interest in, to and under any and all existing and outstanding leases,
licenses and occupancy agreements (collectively, the "Leases"), of the
improvements comprising a part of the Property, including without limitation,
all those Leases described on Schedule 2 attached hereto and incorporated herein
by this reference, together with all security deposits tendered under the Leases
remaining in the possession of Assignor.
Assignee does hereby assume and agree to perform all of Assignor's
obligations under or with respect to the Leases accruing from and after the date
hereof, including without limitation, any and all obligations to pay leasing
commissions and finder's fees which are due or payable after the date hereof
with respect to the Leases, and claims made by tenants with respect to the
tenants' security deposits to the extent paid, credited or assigned to Assignee
by Assignor. Assignee agrees to indemnify, protect, defend and hold Assignor
harmless from and against any and all liabilities, losses, costs, damages and
expenses (including reasonable attorneys' fees) directly or indirectly arising
out of or related to any breach or default in Assignee's obligations hereunder.
This Assignment shall be binding upon and inure to the benefit of Assignor
and Assignee and their respective heirs, executors, administrators, successors
and assigns.
This Assignment may be executed in two or more counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument.
IN WITNESS WHEREOF, Assignor and Assignee have each executed this
Assignment as of the date first written above.
ASSIGNOR:
METROPOLITAN LIFE INSURANCE COMPANY,
a New York corporation
By: __________________________
Name: ▇▇▇▇▇▇ ▇▇▇▇▇
Title: Assistant Vice-President
ASSIGNEE:
CORPORATE REALTY INCOME FUND I,
L.P., a Delaware limited partnership
By: __________________________
Name: ________________________
Title: _______________________
SCHEDULE 1
LEGAL DESCRIPTION
SCHEDULE 2
LEASES
EXHIBIT K
FORM OF ASSIGNMENT OF CONTRACTS
THIS ASSIGNMENT AND ASSUMPTION OF CONTRACTS AND INTANGIBLES (the
"Assignment") is made as of the ___ day of December, 1996, between METROPOLITAN
LIFE INSURANCE COMPANY ("Assignor"), a New York corporation, and CORPORATE
REALTY INCOME FUND I, L.P. ("Assignee"), a Delaware limited partnership.
For and in consideration of the sum of Ten Dollars ($10.00) and other
valuable consideration to it in hand paid by Assignee to Assignor, the
conveyance by Assignor to Assignee of all that certain real property being
particularly described on Schedule 1 attached hereto and incorporated herein by
this reference, more commonly known as ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, located in the City of
New York, County of New York, State of New York (the "Property"), and the mutual
covenants herein contained, the receipt and sufficiency of the foregoing
consideration being hereby acknowledged by the parties hereto, Assignor hereby
assigns, transfers, sets over and conveys to Assignee all of Assignor's right,
title and interest, to the extent assignable, in, to and under any and all of
the following, to wit:
(i) the contracts and agreements listed and described on Schedule 2
attached hereto and incorporated herein by this reference (the "Contracts"),
(ii) all existing warranties and guaranties (express or implied) issued to
Assignor in connection with the improvements or the personal property being
conveyed to Assignee by ▇▇▇▇ of Sale on the date hereof, including, without
limitation, those listed on Schedule 3 attached hereto, and
(iii) all existing permits, licenses, approvals and authorizations issued by
any governmental authority in connection with the Property, including, without
limitation, those listed on Schedule 4 attached hereto.
All items described in (ii) and (iii) above are hereinafter collectively
referred to as "Intangible Property."
Assignee does hereby assume and agree to perform all of Assignor's
obligations under the Contracts and Intangible Property accruing from and after
the date hereof. Assignee agrees to indemnify, protect, defend and hold Assignor
harmless from and against any and all liabilities, losses, costs, damages and
expenses (including reasonable attorneys' fees) directly or indirectly arising
out of or related to any breach or default in Assignee's obligations hereunder.
This Assignment shall be binding upon and inure to the benefit of Assignor
and Assignee and their respective heirs, executors, administrators, successors
and assigns.
This Assignment may be executed in two or more counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument.
IN WITNESS WHEREOF, Assignor and Assignee have each executed this
Assignment as of the date first written above.
ASSIGNOR:
METROPOLITAN LIFE INSURANCE COMPANY,
a New York corporation
By: __________________________
Name: ▇▇▇▇▇▇ ▇▇▇▇▇
Title: Assistant Vice-President
ASSIGNEE:
CORPORATE REALTY INCOME FUND I,
L.P., a Delaware limited partnership
By: __________________________
Name: ________________________
Title: _______________________