EXHIBIT 99
AGREEMENT FOR PURCHASE AND SALE
OF REAL PROPERTY AND ESCROW INSTRUCTIONS
THIS AGREEMENT FOR PURCHASE AND SALE OF REAL PROPERTY AND ESCROW INSTRUCTIONS
("Agreement") is made and entered into as of this 13th day of July, 2005, by and
between ▇▇▇▇▇- City Center West A, LLC, a Nevada limited liability company, as
to an undivided 89.125% interest; NNN City Center West A1, LLC, a Nevada limited
liability company, as to an undivided 5.50% interest and NNN City Center West
A3, LLC, a Nevada limited liability company, as to an undivided 5.35% interest,
and NNN City Center West A4, LLC, a Nevada limited liability company, as to an
undivided .025% interest (individually and collectively, as the context
requires, "Seller"), and Pacifica Real Estate Group, LLC, a California limited
liability company ("Buyer"), with reference to the following facts:
A. Seller owns certain real property located in ▇▇▇▇▇ County, Nevada
and more specifically described in Exhibit A attached hereto (the
"Land"), commonly known as ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇., ▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇ and such other assets, as the same are herein described.
B. Seller desires to sell to Buyer and Buyer desires to purchase from
Seller the Land and the associated assets.
NOW, THEREFORE, in consideration of the mutual covenants, premises and
agreements herein contained, the parties hereto do hereby agree as follows:
1. Purchase and Sale.
1.1. The purchase and sale includes, and at Close of Escrow
(hereinafter defined) Seller shall sell, assign, grant and
transfer to Buyer, Seller's entire right and interest in and
to all of the following (hereinafter sometimes collectively,
the "Property"):
1.1.1. The Land, together with all structures, buildings,
improvements, machinery, fixtures, and equipment affixed
or attached to the Land and all easements and rights
appurtenant to the Land (all of the foregoing being
collectively referred to herein as the "Real Property");
1.1.2. All leases (the "Leases"), including associated
amendments, with all persons ("Tenants") leasing the
Real Property or any part thereof or hereafter entered
into in accordance with the terms hereof prior to Close
of Escrow, together with all security deposits, other
deposits held in connection with the Leases, Lease
guarantees and other similar credit enhancements
providing additional security for such Leases;
1.1.3. All tangible and intangible personal property owned by
Seller located on or used in connection with the Real
Property, including, specifically,
without limitation, equipment, furniture, tools and
supplies, and all related intangibles including Seller's
interest, if any, in the name "City Center West
Building A" (the "Personal Property");
1.1.4. All service contracts, agreements, warranties and
guaranties relating to the operation of the Property
(the "Contracts"); and
1.1.5. To the extent transferable, all building permits,
certificates of occupancy and other certificates,
permits, licenses and approvals relating to the Property
(the "Permits").
1.1.6. All of Seller's rights in and to all trade names
(including "City Center West") under which Seller has
operated the Property (the "Trade Names").
2. Purchase Price.
The total Purchase Price of the Property shall be THIRTY MILLION EIGHT
HUNDRED THOUSAND DOLLARS ($30,800,000.00) ("Purchase Price") payable as
follows:
2.1. Deposit/Further Payments/Down Payment.
2.1.1. Within one (1) business day following the Opening of
Escrow (as hereinafter defined), Buyer shall deposit
into Escrow the amount of ONE MILLION DOLLARS
($1,000,000.00) (the "Deposit"), in the form of a wire
transfer payable to Land America Commonwealth Escrow
Services, at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇
▇▇▇▇▇, Attn: ▇▇▇▇▇▇▇ Mesh (▇▇▇) ▇▇▇-▇▇▇▇ ▇▇▇ ("Escrow
Holder"). The Deposit shall be applicable to the
Purchase Price and Eight Hundred Fifty Thousand and
No/100 Dollars ($850,000.00) of the Deposit (the
"Refundable Deposit") shall remain refundable to Buyer
for any reason throughout the end of the Inspection
Period (as herein defined) and thereafter only under
those circumstances specifically identified in this
Agreement. The remaining One Hundred Fifty Thousand and
No/100 Dollars ($150,000.00) of the Deposit (the
"Nonrefundable Deposit") shall be delivered to Seller by
Escrow Holder promptly upon receipt and shall be deemed
to be fully earned by Seller and nonrefundable to
Purchaser as of the due date for deposit of such
installment with Escrow Holder as provided above. Escrow
Holder shall place the Refundable Deposit into an
interest bearing money market account at a bank or other
financial institution reasonably satisfactory to Buyer,
and interest thereon shall be credited to Buyer's
account.
2.1.2. On or before Close of Escrow (as defined in Section
6.2.1, below), Buyer shall deposit into Escrow the
balance of the Purchase Price, by wire transfer payable
to Escrow Holder, less the amount of the "Rent
Concession Credit" described in Section 6.8, below.
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3. Title to Property.
3.1. Title Insurance.
Escrow Holder will obtain a Standard Coverage CLTA owner's policy
of title insurance from LandAmerica Lawyers Title, at ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attn: ▇▇▇▇▇ ▇▇▇▇▇,
(▇▇▇) ▇▇▇-▇▇▇▇ (the "Title Company") with their standard
provisions and exceptions (the "Title Policy") in the amount of
the Purchase Price. The Title Policy shall insure title to the
Property free and clear of encumbrances except for the following
permitted exceptions (collectively, the "Permitted Exceptions"):
3.1.1. Real property taxes and assessments, which are a lien not
yet due;
3.1.2. Covenants, conditions, reservations (including exceptions
of oil, gas, minerals, hydrocarbons and/or lease without
right of surface entry), restrictions, rights of way, and
easements for public utilities, districts, water
companies, alleys and streets; and
3.1.3. The permitted exceptions included in such policy and
approved by Buyer.
Seller covenants and agrees to remove from title on or before
Close of Escrow (and the term "Permitted Exceptions" shall not
include) any monetary liens relating to borrowed funds or other
liens securing indebtedness of an ascertainable amount, in each
case created by Seller.
3.2. Procedure for Approval of Title.
During the Inspection Period (hereafter defined) Buyer shall
review and approve the Title Documents (hereinafter defined) and
the Survey (hereinafter defined). If the Title Documents or
Survey reflect or disclose any defect, exception or other matter
affecting the Property ("Title Defects") that is unacceptable to
Buyer, then prior to the expiration of the Inspection Period,
Buyer shall provide Seller with written notice of Buyer's
objections. Seller may, at its sole option, elect to cure or
remove the objections made by Buyer. Should Seller elect to
attempt to cure or remove the objection, it shall be a condition
precedent to Buyer's obligation to acquire the Property that
Seller cures such title objection prior to the Close of Escrow.
Unless Seller provides written notice to Buyer before the
expiration of the Inspection Period that Seller intends to cure
Buyer's title objections, Seller shall be deemed to have elected
not to cure or remove Buyer's title objections, and Buyer shall
be entitled, as Buyer's sole and exclusive remedies, either to
(i) terminate this Agreement by providing written notice of
termination to Seller before the end of the Inspection Period,
whereupon Buyer shall return all Due Diligence Items (hereinafter
defined) to Seller, the Refundable Deposit shall be paid to
Buyer, the Nonrefundable Deposit shall be retained by Seller and,
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thereafter, neither Seller nor Buyer shall have any continuing
obligations hereunder, except as otherwise expressly provided
herein or (ii) waive the objections and close this transaction as
otherwise contemplated herein. If Buyer shall fail to terminate
this Agreement during the Inspection Period, all matters shown on
the Survey or described in the Title Report, except for monetary
liens for indebtedness of Seller and any matters Seller has
agreed to cure in writing, shall be deemed to be "Permitted
Exceptions" hereunder.
4. Due Diligence Items.
4.1. Within one (1) business day following the Opening of Escrow,
Seller shall make available to Buyer each of the following
items (collectively, the "Due Diligence Items"):
4.1.1. The existing survey of the Property, if any (the
"Survey");
4.1.2. A current preliminary title report or title commitment
(the "Title Report") for the issuance of policy of title
insurance to Buyer from the Escrow Holder, together with
good and legible copies of all documents constituting
exceptions to the title as reflected in the Title Report
(collectively referred to hereinafter as the "Title
Documents");
4.1.3. A list of all contracts, including service contracts,
warranties, management, maintenance, leasing commission
or other agreements affecting the Property, if any,
together with copies of the same shall be available for
inspection. Seller agrees not to enter into any
additional contracts or agreements prior to closing
which cannot be canceled upon thirty (30) days written
notice without cost, penalty, or obligation unless such
contracts or other agreements are approved in writing by
Buyer, which approval shall not be unreasonably withheld
or delayed;
4.1.4. All site plans, leasing plans, as-built plans, drawings,
environmental, mechanical, electrical, structural, soils
and similar reports and/or audits and plans and
specifications relative to the Property in the
possession of Seller, if any, shall be made available
for inspection at Seller's offices;
4.1.5. True and correct copies of the real estate and personal
property tax statements covering the Property or any
part thereof for each of the two (2) years prior to the
current year and, if available, for the current year;
4.1.6. A schedule of all current or pending litigation with
respect to the Property or any part, thereof, if any;
4.1.7. A copy of operating statements for the most recent two
calendar years and the current year-to-date through the
last full calendar month immediately prior to the
Opening of Escrow.
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4.1.8. The tenant files, books and records relating to the
ownership and operation of the Property shall be
available for inspection by Buyer during ordinary
business hours at Seller's management office; and
4.1.9. An inventory of all personal property located on the
Property, used in the maintenance of the Property or
stored for future use at the Property and an inventory
of all furniture and appliances used in the units, if
any.
4.2. Estoppel Certificates.
As a condition precedent to Buyer's obligation to acquire the
Property, Seller shall obtain and deliver to Buyer estoppel
certificates, in accordance with their respective Leases, from
tenants representing seventy percent (70%) of the square feet
which are leased and occupied by tenants as of the date this
Agreement is fully executed (the "Estoppel Threshold"). Estoppel
certificates shall be deemed to satisfy this condition precedent
unless they disclose material adverse matters. Buyer shall notify
Seller within three (3) business days of receipt of a copy of the
executed estoppel certificate of its approval or disapproval and
the basis of such disapproval, if disapproved. If (i) Seller is
unable by the Closing Date to obtain enough estoppel certificates
to satisfy the Estoppel Threshold or (ii) Buyer disapproves of an
estoppel certificate because of a material, adverse matter
disclosed therein and Seller is unable to obtain a reasonably
acceptable estoppel certificate prior to the Close of Escrow,
then Buyer may elect either (a) to terminate this Agreement,
whereupon Buyer shall return all Due Diligence Items to Seller,
the Refundable Deposit shall be paid to Buyer, the Nonrefundable
Deposit shall be retained by Seller and, thereafter, neither
Seller nor Buyer shall have any continuing obligations hereunder,
except as otherwise expressly provided herein or (b) to proceed
with Close of Escrow, in which event Seller shall provide to
Buyer at Close of Escrow a Seller's estoppel certificate with
respect to, as applicable, sufficient leases at the Property to
satisfy the Estoppel Threshold or the particular lease for which
Buyer disapproved of the estoppel certificate submitted by the
tenant thereunder because of a material, adverse matter disclosed
therein. Notwithstanding anything contained in this Agreement to
the contrary, the period of survival of Seller's liability under
any such Seller's estoppel certificate shall be six (6) months
from the Closing Date. Furthermore, if Seller shall provide a
Seller's estoppel certificate with respect to any lease and
subsequently delivers to Buyer an estoppel from the tenant
thereunder that does not disclose any material adverse matters,
then the Seller's estoppel certificate with respect to said lease
shall automatically become null and void ab initio, and Seller
shall have no further liability whatsoever to Buyer with respect
thereto.
5. Inspections.
Buyer, at its sole expense, shall have the right to conduct feasibility,
environmental, engineering and physical studies or other tests (the
"Inspections") of the Property at any
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time during the Inspection Period (hereinafter defined). Buyer, and its
duly authorized agents or representatives, shall be permitted to enter
upon the Property at all reasonable times during the Inspection Period in
order to conduct engineering studies, soil tests and any other Inspections
and/or tests that Buyer may deem necessary or advisable. Buyer must
arrange all Inspections of the Property with Seller at least two (2)
business days in advance of any Inspections. In the event that the review
and/or Inspection conducted pursuant to this paragraph shows any fact,
matter or condition to exist with respect to the Property that is
unacceptable to Buyer, in Buyer's sole subjective discretion, then Buyer
shall be entitled, as its sole and exclusive remedy, to (1) terminate this
Agreement, whereupon Buyer shall return all Due Diligence Items to Seller,
the Refundable Deposit shall be paid to Buyer, the Nonrefundable Deposit
shall be retained by Seller and, thereafter, neither Seller nor Buyer
shall have any continuing obligations hereunder, except as otherwise
expressly provided herein, or (2) waive the objection, and close the
transaction as otherwise contemplated herein. Buyer agrees to promptly
discharge any liens that may be imposed against the Property as a result
of the Inspections and to defend, indemnify and hold Seller harmless from
all, claims, suits, losses, costs, expenses (including without limitation
court costs and attorneys' fees), liabilities, judgments and damages
incurred by Seller as a result of any Inspections.
5.1. Approval.
5.1.1. Buyer shall have until 5:00 PM Los Angeles, CA time on
July 19, 2005 ("Inspection Period") to approve or
disapprove the Inspections. If Buyer shall fail to
notify Seller and Escrow Holder of its disapproval of
the Inspections in writing within the Inspection Period,
the condition of the Property shall be deemed approved.
If Buyer shall disapprove in writing the Inspections
within the Inspection Period, this Agreement and the
Escrow shall thereupon be terminated. Buyer shall not be
entitled to purchase the Property, Seller shall not be
obligated to sell the Property to Buyer, Buyer shall
return all Due Diligence Items to Seller, the Refundable
Deposit shall be paid to Buyer, the Nonrefundable
Deposit shall be retained by Seller and, thereafter,
neither Seller nor Buyer shall have any continuing
obligations hereunder, except as otherwise expressly
provided herein.
5.1.2. Notwithstanding anything to the contrary contained
herein, Buyer hereby agrees that, in the event this
Agreement is terminated for any reason, then Buyer shall
promptly and at its sole expense return to Seller all
Due Diligence Items which have been delivered by Seller
to Buyer in connection with the Inspections, along with
copies of all reports, drawings, plans, studies,
summaries, surveys, maps and other data prepared by
third parties relating to the Property, subject to
restrictions on Buyer's ability to make any such
materials available to Seller that are imposed in any
agreement with a third party consultant preparing any
such reports or materials ("Buyer's Reports"). Buyer
shall cooperate with
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Seller at no expense to Buyer in order to obtain a
waiver of any such limitations.
5.1.3. Notwithstanding any contrary provision of this
Agreement, Buyer acknowledges that Seller is not
representing or warranting that any of the Due Diligence
Items prepared by third parties are accurate or
complete, such as the Survey, engineering reports and
the like. Seller advises Buyer to independently verify
the facts and conclusions set forth therein, provided
however, Seller warrants that it has no knowledge of any
material errors or misstatements in such information
regarding the Property.
6. Escrow.
6.1. Opening.
Purchase and sale of the Property shall be consummated through an
escrow ("Escrow") to be opened with Escrow Holder within two (2)
business days after the execution of this Agreement by Seller and
Buyer. Escrow shall be deemed to be opened as of the date fully
executed copies (or counterparts) of this Agreement are delivered
to Escrow Holder by Buyer and Seller ("Opening of Escrow"). This
Agreement shall be considered as the Escrow instructions between
the parties, with such further instructions as Escrow Holder
shall require in order to clarify its duties and
responsibilities. If Escrow Holder shall require further Escrow
instructions, Escrow Holder may prepare such instructions on its
usual form. Such further instructions shall be promptly signed by
Buyer and Seller and returned to Escrow Holder within three (3)
business days of receipt thereof. In the event of any conflict
between the terms and conditions of this Agreement and such
further instructions, the terms and conditions of this Agreement
shall control.
6.2. Close of Escrow.
6.2.1. Escrow shall close ("Close of Escrow") on or before July
27, 2005 (the "Closing Date").
6.2.2. Seller and Buyer agree to conduct the Closing of the
purchase and sale of the Property hereunder as a "New
York-style" closing, with a gap indemnity from Seller
for title issues and a release of the funds due to
Seller and its lender (if any) prior to the date on
which the Grant Deed (as defined in Section 6.4.1,
below) is recorded in the Official Records of the County
in which the Property is situated.
6.3. Buyer Required to Deliver. Buyer shall deliver to Escrow the
following:
6.3.1. Within one (1) business day of the Opening of Escrow,
the Deposit;
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6.3.2. On or before Close of Escrow, the payment required by
Paragraph 2.1.2; provided, however that Buyer shall not
be required to deposit the amount specified in Paragraph
2.1.2 until Buyer has been notified by Escrow Holder
that (i) Seller has delivered to Escrow each of the
documents and instruments to be delivered by Seller in
connection with Buyer's purchase of the Property, (ii)
Title Company has committed to issue and deliver the
Title Policy to Buyer in compliance with Section 3
hereof, and (iii) the only impediment to Close of Escrow
is delivery of such amount by or on behalf of Buyer;
6.3.3. On or before Close of Escrow, such other documents as
Title Company may require from Buyer in order to issue
the Title Policy;
6.3.4. An original assignment and assumption agreement (the
"Assignment and Assumption Agreement") duly executed by
Seller assigning and conveying to Buyer all of Seller's
right, title and interest in and to the Leases, the
Contracts, the Permits (to the extent transferable) and
the Trade Names.
6.4. Seller Required to Deliver.
On or before Close of Escrow, Seller shall deliver to Escrow the
following:
6.4.1. A duly executed and acknowledged grant deed, conveying
fee title to the Property in favor of Buyer, subject
only to the Permitted Exceptions (the "Grant Deed");
6.4.2. An executed Certificate of Non-Foreign Status;
6.4.3. A ▇▇▇▇ of sale of the Personal Property, if any, without
warranty, in favor of Buyer and duly executed by Seller;
6.4.4. Such other documents as Title Company may require from
Seller in order to issue the Title Policy;
6.4.5. Tenant estoppel certificates;
6.4.6. Seller shall deliver to Buyer all keys to all buildings
and other improvements located on the Property,
combinations to any safes thereon, and security devices
therein in Seller's possession;
6.4.7. Seller shall deliver all records and files relating to
the management or operation of the Property, including,
without limitation, all insurance policies, all security
contracts, all tenant files (including correspondence),
property tax bills, and all calculations used to prepare
statements of rental increases under the Leases and
statements of common area charges,
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insurance, property taxes and other charges which are
paid by tenants of the Project; and
6.4.8. A counterpart original of the Assignment and Assumption
Agreement.
6.5. Buyer's Costs.
Buyer shall pay the following:
6.5.1. One-half (1/2) of Escrow Holder's fees, costs and
expenses;
6.5.2. One-half (1/2) of the cost of recording the Grant Deed,
including documentary transfer taxes;
6.5.3. All other costs customarily borne by purchasers of real
property in ▇▇▇▇▇ County, Nevada; and
6.5.4. If Buyer elects to obtain extended coverage title
insurance, the amount by which the premium for an
extended coverage policy of title insurance in the
amount of the Purchase Price exceeds the premium for the
Title Policy.
6.6. Seller's Costs.
Seller shall pay the following:
6.6.1. One-half (1/2) of Escrow Holder's fees, costs and
expenses;
6.6.2. One-half (1/2) of the cost of recording the Grant Deed,
including documentary transfer taxes;
6.6.3. Title Company's premium for the base title insurance
coverage provided by the Title Policy; and
6.6.4. All other costs customarily borne by sellers of real
property in ▇▇▇▇▇ County, Nevada.
6.7. Prorations.
6.7.1. Real property taxes, assessments, rents, security
deposits, and cam expenses shall be prorated through
Escrow between Buyer and Seller as of Close of Escrow.
Rents, security deposits and "CAM" expenses shall be
approved by Buyer prior to Close of Escrow. Any
delinquent rents collected by Buyer shall be paid to
Seller. Seller shall have the right to pursue any Tenant
for delinquent rent, but shall not cause a Tenant to be
delinquent for their current rent or become financially
unstable or commence eviction proceedings against any
such Tenant. Tax and
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assessment prorations shall be based on the latest
available tax ▇▇▇▇. If, after Close of Escrow, Buyer
receives any further or supplemental tax ▇▇▇▇ relating
to any period prior to Close of Escrow, or Seller
receives any further or supplemental tax ▇▇▇▇ relating
to any period after Close of Escrow, the recipient shall
promptly deliver a copy of such tax ▇▇▇▇ to the other
party, and not later than ten (10) days prior to the
delinquency date shown on such tax ▇▇▇▇ Buyer and Seller
shall deliver to the taxing authority their respective
shares of such tax ▇▇▇▇, prorated as of Close of Escrow.
6.7.2. All leasing commissions owing and tenant improvements
with respect to the Property transactions entered into
prior to execution of this Agreement shall be paid by
Seller, and Seller shall indemnify and hold Buyer
harmless for Lease commission claims brought against the
Property arising therefrom. All leasing commissions for
new Leases and for Lease renewals executed and expansion
options exercised after the date of this Agreement shall
be prorated between Buyer and Seller as their respective
periods of ownership bear to the primary term of the new
Lease.
6.7.3. Seller agrees to indemnify and hold Buyer harmless of
and from any and all liabilities, claims, demands,
suits, and judgments, of any kind or nature, including
court costs and reasonable attorneys' fees (except those
items which under the terms of this Agreement
specifically become the obligation of Buyer), brought by
third parties and based on events occurring on or before
the date of closing and which are in any way related to
the Property, and all expenses related thereto,
including but not limited to court costs and attorneys'
fees.
6.7.4. Buyer agrees to indemnify and hold Seller harmless of
and from any and all liabilities, claims, demands, suits
and judgments, of any kind or nature, including court
costs and reasonable attorneys' fees, brought by third
parties and based on events occurring subsequent to the
date of closing and which are in any way related to the
Property, and all expenses related thereto, including,
but not limited to, court costs and attorneys' fees.
6.8. Rent Concession Credit.
6.8.1. Credit. The parties (a) acknowledge that Seller has
informed Buyer that (i) certain of the leases for
portions of the Property include commitments by Seller
to provide free rent, undertake tenant improvement work,
and incur certain leasing commission costs, and (ii)
Seller is in negotiations to renew, expand, and
otherwise amend the terms of certain existing leases
with the "Subject Tenants" (as defined in Section 6.8.4,
below), and that in such lease amendments, Seller (as
the "lessor" thereunder) shall agree to grant certain
"free rent" concessions, undertake certain tenant
improvement work, and incur certain leasing commissions
(the
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concessions in such existing leases and the amended
leases with such Subject Tenants collectively, the "Rent
Concessions"), and (b) agree that at the Close of
Escrow, Buyer shall accept an assignment of the leases
with tenants at the Property, including the amended
leases with such Subject Tenants, subject to those Rent
Concessions, and (c) further agree that, in
consideration of Buyer's agreement set forth in the
preceding clause "(b)," Seller shall provide to Buyer at
Close of Escrow a credit in the amount described in
Section 6.8.2, below (such credit, the "Rent Concession
Credit").
6.8.2. Amount of Credit. Subject to adjustment pursuant to
Section 6.8.3, below, the amount of the Rent Concessions
Credit shall be equal to the sum of the following
amounts: (a) the actual amount of "free rent" provided
to tenants at the Property for periods following the
Close of Escrow, plus (b) up to $177,590.00 for
commitments to undertake or pay the cost of tenant
improvement work, plus (c) up to $113,909.00 for leasing
commissions with respect to such Rent Concessions for
the Subject Tenants.
6.8.3. Covenant of Seller. Seller (a) warrants that Seller has
not made commitments to any tenants at the Property, and
agrees not to make commitments to tenants at the
Property, including, in each instance, the Subject
Tenants, for tenant improvement work costing in the
aggregate more than the amount set forth in Section
6.8.2(b), above, and (b) warrants that Seller has not
incurred, and agrees not to make commitments to incur,
leasing commissions with respect to the Property costing
in the aggregate amount in excess of the amount set
forth in Section 6.8.2(c), above. If, prior to the Close
of Escrow, it is determined that Seller has breached any
of the warranties or covenants set forth in the
preceding sentence, then the amount of the Rent
Concessions Credit shall be increased by an amount equal
to the excess amount committed or incurred (as the case
may be) by Seller in breach of such warranties or
covenants.
6.8.4. Subject Tenants. For purposes of this Section 6.8, the
term "Subject Tenants" shall mean the following existing
tenants at the Property: Safeco Insurance, First
American Title, Headway Corporate Staffing, ▇▇▇▇▇▇▇ Law
Offices, Citadel Broadcasting, Tuverson & ▇▇▇▇▇▇▇.
6.9. Separation of Utilities and EMS Monitoring System.
6.9.1. Electricity Meter for Common Parcel. Prior to or as
promptly as reasonably practicable following the
Closing, Seller, at its sole cost and expense, shall
install a separate electricity meter that will monitor
the delivery of electricity to the common parcel that
contains the parking facility that serves both the Real
Property and the adjacent parcel of real property that
is being retained by Seller and its affiliates (the
"Retained Parcel").
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6.9.2. Separation of EMS System. Seller (a) acknowledges that
the building situated on the Real Property contains an
energy management system (the "EMS System") that
controls and monitors both the HVAC system serving such
building and the HVAC system serving the building on the
Retained Parcel ("Seller's HVAC System"), and (b) agrees
that, at the sole cost and expense of Seller and as
promptly as practicable following the Close of Escrow,
Seller shall (i) modify such EMS System in such manner
as is reasonably required to cause that EMS System to
monitor and control only the HVAC system serving the
building on the Real Property, and (ii) install at a
location other than on the Real Property such
alternative energy management system and controls as
Seller may desire for controlling and monitoring
Seller's HVAC System. Seller shall undertake all such
work in such manner as does not interfere with the
operation of the EMS System or the functionality of the
HVAC system serving the building situated on the Real
Property.
6.9.3. Holdback. To secure Seller's obligations under this
Section 6.9, Escrow Holder shall withhold from the funds
otherwise payable to Seller at the Close of Escrow an
amount equal to one hundred ten percent (110%) of the
reasonably estimated cost of the work described in
Sections 6.9.1 and 6.9.2, above (such 100% amount, the
"Holdback Amount"). Upon Seller's completion of such
work in accordance with this Section 6.9, Buyer shall
consent to a release of such Holdback Amount from
Escrow. The parties acknowledge that Seller has informed
Buyer that as of the date of this Agreement, Seller has
received an estimate that the cost of the work described
in Sections 6.9.1 and 6.9.2 shall be approximately
Twenty-four Thousand One Hundred Dollars ($24,100).
6.10. Determination of Dates of Performance.
Promptly after delivery to Buyer of the Title Report, Escrow
Holder shall prepare and deliver to Buyer and Seller a schedule
which shall state each of the following dates:
6.10.1. The date of Opening of Escrow pursuant to Paragraph 6.1;
6.10.2. The date of receipt of the Title Report by Buyer;
6.10.3. The date by which title must be approved by Buyer
pursuant to Paragraph 3.2;
6.10.4. The date by which the Inspections must be approved by
Buyer pursuant to Paragraph 5.1.1;
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6.10.5. The date by which the amounts described in Paragraph 2
must be deposited by Buyer, for which determination
Escrow Holder shall assume satisfaction of the condition
expressed in Paragraph 2 on the last date stated for its
satisfaction; and
6.10.6. The date of Close of Escrow pursuant to Paragraph 6.2.
If any events which determine any of the aforesaid dates occur on
a date other than the date specified or assumed for its
occurrence in this Agreement, Escrow Holder shall promptly
redetermine as appropriate each of the dates of performance in
the aforesaid schedule and notify Buyer and Seller of the dates
of performance, as redetermined.
7. Representations, Warranties, and Covenants.
7.1. Representations and Warranties. Seller hereby represents and
warrants as of the date hereof to Buyer as follows:
7.1.1. Each of the entities comprising Seller is a limited
liability company duly formed and validly existing under
the laws of the State of Nevada. Seller has full power
and authority to enter into this Agreement, to perform
this Agreement and to consummate the transactions
contemplated hereby. The execution, delivery and
performance of this Agreement and all documents
contemplated hereby by Seller have been duly and validly
authorized by all necessary action on the part of Seller
and all required consents and approvals have been duly
obtained and will not result in a breach of any of the
terms or provisions of, or constitute a default under
any indenture, agreement or instrument to which Seller
is a party. This Agreement is a legal, valid and binding
obligation of Seller, enforceable against Seller in
accordance with its terms, subject to the effect of
applicable bankruptcy, insolvency, reorganization,
arrangement, moratorium or other similar laws affecting
the rights of creditors generally.
7.1.2. Seller has good and marketable title to the Property,
subject to the conditions of title. There are no
outstanding rights of first refusal, rights of reverter
or optional purchase rights relating to the Property or
any interest therein. To Seller's knowledge, there are
no unrecorded or undisclosed documents or other matters
which affect title to the Property. Subject to the
Leases, Seller has enjoyed the continuous and
uninterrupted quiet possession, use and operation of the
Property, without material complaint or objection by any
person.
7.1.3. Seller is not a "foreign person" within the meaning of
Section 1445(f) of the Internal Revenue Code of 1986, as
amended (the "Code").
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7.2. Covenants of Seller. Seller hereby covenants as follows:
7.2.1. At all times from the date hereof through the date of
closing, Seller shall cause to be in force fire and
extended coverage insurance upon the Property, and public
liability insurance with respect to damage or injury to
persons or property occurring on the Property in at least
such amounts as are maintained by Seller on the date
hereof;
7.2.2. From the date of execution of this Agreement through the
Closing Date, Seller will not enter into any new lease
with respect to the Property, without Buyer's prior
written consent, which shall not be unreasonably withheld.
Exercise of a renewal option shall not be considered a new
lease. Any brokerage commission payable with respect to a
new lease shall be prorated between Buyer and Seller in
accordance with their respective periods of ownership as
it bears to the primary term of the new lease. Further,
Seller will not modify any existing Lease covering space
in the Property without first obtaining the written
consent of Buyer which shall not be unreasonably withheld.
Buyer shall have five (5) business days in which to
approve or disapprove of any new lease for which it has a
right to consent. Failure to respond in writing within
said time period shall be deemed to be consent;
7.2.3. From the date of execution of this Agreement through the
date of closing, Seller shall not sell, assign, or convey
any right, title or interest whatsoever in or to the
Property, or create or permit to attach any lien, security
interest, easement, encumbrance, charge, or condition
affecting the Property (other than the Permitted
Exceptions) without promptly discharging the same prior to
closing;
7.2.4. Seller shall not, without Buyer's written approval, (a)
amend or waive any right under any service Contract, or
(b) enter into any agreement of any type affecting the
Property that would survive the Closing Date;
7.2.5. Seller shall fully and timely comply with all obligations
to be performed by it under the Leases, the Contracts, and
all permits, licenses, approvals and laws, regulations and
orders applicable to the Property.
7.3. Approval of Property. The consummation of the purchase and sale
of the Property pursuant to this Agreement shall be deemed Buyer's
acknowledgement that it has had an adequate opportunity to make such
legal, factual and other inspections, inquiries and investigations as it
deems necessary, desirable or appropriate with respect to the Property.
Such inspections, inquiries and investigations of Buyer shall be deemed to
include, but shall not be limited to: any leases and contracts pertaining
to the Property, the physical components of all portions of the Property,
the physical condition of the Property, such state of facts as an accurate
survey, environmental report and inspection would show, and present and
future zoning ordinances and resolutions. Buyer shall not be entitled to
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and shall not rely upon Seller or Seller's agents with regard to, and
Seller will not make any representation or warranty with respect to: (i)
the quality, nature, adequacy or physical condition of the Property
including, but not limited to, the structural elements, foundation, roof,
appurtenances, access, landscaping, parking facilities, or the electrical,
mechanical, HVAC, plumbing, sewage or utility systems, facilities, or
appliances at the Property, if any; (ii) the quality, nature, adequacy or
physical condition of soils or the existence of ground water at the
Property; (iii) the existence, quality, nature, adequacy or physical
condition of any utilities serving the Property; (iv) the development
potential of the Property, its habitability, merchantability, or the
fitness, suitability, or adequacy of the Property for any particular
purpose; (v) the zoning or other legal status of the Property; (vi) the
Property or its operations' compliance with any applicable codes, laws,
regulations, statutes, ordinances, covenants, conditions or restrictions
of any governmental or quasi-governmental entity or of any other person or
entity; (vii) the quality of any labor or materials relating in any way to
the Property; or (viii) the condition of title to the Property or the
nature, status and extent of any right-of-way, lease, right of redemption,
possession, lien, encumbrance, license, reservation, covenant, condition,
restriction, or any other matter affecting the Property except as
expressly set forth in this Agreement. EXCEPT AS EXPRESSLY PROVIDED IN
THIS AGREEMENT AND THE GRANT DEED, SELLER HAS NOT, DOES NOT, AND WILL NOT
MAKE ANY WARRANTIES OR REPRESENTATIONS WITH RESPECT TO THE PROPERTY AND
SELLER SPECIFICALLY DISCLAIMS ANY OTHER IMPLIED WARRANTIES OR WARRANTIES
ARISING BY OPERATION OF LAW, INCLUDING, BUT IN NO WAY LIMITED TO, ANY
WARRANTY OF CONDITION, MERCHANTABILITY, HABITABILITY, OR FITNESS FOR A
PARTICULAR PURPOSE OR USE. FURTHERMORE, SELLER HAS NOT, DOES NOT, AND WILL
NOT MAKE ANY REPRESENTATION OR WARRANTY WITH REGARD TO COMPLIANCE WITH ANY
ENVIRONMENTAL PROTECTION, POLLUTION, OR LAND USE LAWS, RULES, REGULATIONS,
ORDERS, OR REQUIREMENTS INCLUDING, BUT NOT LIMITED TO, THOSE PERTAINING TO
THE HANDLING, GENERATING, TREATING, STORING OR DISPOSING OF ANY HAZARDOUS
WASTE OR SUBSTANCE INCLUDING, WITHOUT LIMITATION, ASBESTOS, PCB AND RADON.
BUYER ACKNOWLEDGES THAT BUYER IS A SOPHISTICATED BUYER FAMILIAR WITH THIS
TYPE OF PROPERTY AND THAT, SUBJECT ONLY TO THE EXPRESS WARRANTIES SET
FORTH IN THIS AGREEMENT AND CLOSING DOCUMENTS, BUYER WILL BE ACQUIRING THE
PROPERTY "AS IS AND WHERE IS, WITH ALL FAULTS," IN ITS PRESENT STATE AND
CONDITION, SUBJECT ONLY TO NORMAL WEAR AND TEAR AND BUYER SHALL ASSUME THE
RISK THAT ADVERSE MATTERS AND CONDITIONS MAY NOT HAVE BEEN REVEALED BY
BUYER'S INSPECTIONS AND INVESTIGATIONS. BUYER SHALL ALSO ACKNOWLEDGE AND
AGREE THAT THERE ARE NO ORAL AGREEMENTS, WARRANTIES OR REPRESENTATIONS,
COLLATERAL TO OR AFFECTING THE PROPERTY BY SELLER, ANY AGENT OF SELLER OR
ANY THIRD PARTY. THE TERMS AND CONDITIONS OF THIS PARAGRAPH SHALL SURVIVE
THE CLOSING, AND NOT MERGE WITH THE PROVISIONS OF
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ANY CLOSING DOCUMENTS. SELLER SHALL NOT BE LIABLE OR BOUND IN ANY MANNER
BY ANY ORAL OR WRITTEN STATEMENTS, REPRESENTATIONS OR INFORMATION
PERTAINING TO THE PROPERTY FURNISHED BY ANY REAL ESTATE BROKER, AGENT,
EMPLOYEE, SERVANT OR OTHER PERSON, UNLESS THE SAME ARE SPECIFICALLY SET
FORTH OR REFERRED TO IN THIS AGREEMENT.
8. Representations and Warranties of Buyer. Buyer hereby represents and
warrants to Seller as follows:
8.1. Buyer is a limited liability company, duly organized and
validly existing under the laws of the State of California.
Buyer has full power and authority to enter into this
Agreement, to perform this Agreement and to consummate the
transactions contemplated hereby. The execution, delivery and
performance of this Agreement and all documents contemplated
hereby by Buyer have been duly and validly authorized by all
necessary action on the part of Buyer and all required
consents and approvals have been duly obtained and will not
result in a breach of any of the terms or provisions of, or
constitute a default under any indenture, agreement or
instrument to which Buyer is a party. This Agreement is a
legal, valid and binding obligation of Buyer, enforceable
against Buyer in accordance with its terms, subject to the
effect of applicable bankruptcy, insolvency, reorganization,
arrangement, moratorium or other similar laws affecting the
rights of creditors generally.
9. Conditions Precedent to Closing.
The obligations of Buyer pursuant to this Agreement shall, at the option
of Buyer, be subject to the following conditions precedent:
9.1. All of the representations, warranties and agreements of
Seller set forth in this Agreement shall be true and correct
in all material respects as of the date hereof and as of the
Closing Date, and Seller shall not have on or prior to
closing, failed to meet, comply with or perform in any
material respect any conditions or agreements on Seller's part
as required by the terms of this Agreement.
9.2. There shall be no change in the matters reflected in the Title
Report, and there shall not exist any encumbrance or title
defect affecting the Property not described in the Title
Report except for the Permitted Exceptions or matters to be
satisfied at closing.
9.3. Unless Seller receives notice from Buyer at least thirty (30)
days prior to closing, effective as of closing, the management
agreement affecting the Property shall be terminated by Seller
and any and all termination fees incurred as a result thereof
shall be the sole obligation of Seller.
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9.4. Seller shall have operated the Property from and after the
date hereof in substantially the same manner as prior thereto.
9.5. If any such condition is not fully satisfied by closing, Buyer
shall so notify Seller and may terminate this Agreement by
written notice to Seller, whereupon the Due Diligence Items
will be promptly returned to Seller, the Refundable Deposit
shall be paid to Buyer, the Nonrefundable Deposit shall be
retained by Seller and, thereafter, neither Seller nor Buyer
shall have any continuing obligations hereunder, except as
otherwise expressly provided herein.
9.6. If Buyer notifies Seller of a failure to satisfy the
conditions precedent set forth in this paragraph, Seller may,
within five (5) days of receipt of such notices agree to
satisfy the condition by written notice to Buyer, and Buyer
shall thereupon be obligated to close the transaction provided
Seller so satisfies such condition. If Seller fails to agree
to cure or fails to cure such condition by the Closing Date,
this Agreement shall be canceled, whereupon the Due Diligence
Items will be promptly returned to Seller, the Refundable
Deposit shall be returned to Buyer, the Nonrefundable Deposit
shall be retained by Seller and, thereafter, neither Seller
nor Buyer shall have any continuing obligations hereunder,
except as otherwise expressly provided herein.
9.7. If Buyer's acquisition of the Property is part of a
tax-deferred exchange pursuant to Section 1031 of the Code, it
is a condition precedent to the closing of this Escrow that
Buyer is able to complete an exchange for all or a portion of
its relinquished property pursuant to an exchange agreement
between Buyer and its accommodator. Seller agrees to execute
such documents or instruments as may be necessary or
appropriate to evidence such exchange, provided that Seller's
cooperation in such regard shall be at no additional cost,
expense, or liability whatsoever to Seller, and that no
additional delays in the scheduled Close of Escrow are
incurred unless mutually agreed upon by all parties to this
Agreement.
10. Damage or Destruction Prior to Close of Escrow.
In the event that the Property should be damaged by any casualty prior to
the Close of Escrow, then if the cost of repairing such damage, as
estimated by an architect or contractor retained pursuant to the mutual
agreement of the parties, is:
10.1. Less than Two Hundred Fifty Thousand Dollars ($250,000), then
(a) the Close of Escrow shall proceed as scheduled, (b) any
insurance proceeds shall be distributed to Buyer to the extent
not expended by Seller for restoration, and (c) the Purchase
Price shall be reduced by the amount of the uninsured portion
of such loss (including the amount of any deductible under any
insurance policy covering such loss);
17
or if said cost is:
10.2. Greater than Two Hundred Fifty Thousand Dollars ($250,000),
then Buyer may elect to terminate this Agreement, whereupon
the Due Diligence Items will be promptly returned to Seller,
the Refundable Deposit shall be returned to Buyer, the
Nonrefundable Deposit shall be retained by Seller and,
thereafter, neither Seller nor Buyer shall have any continuing
obligations hereunder, except as otherwise expressly provided
herein. If Buyer does not elect to exercise such termination
right, then the parties shall proceed with the Close of
Escrow, in which event (a) any insurance proceeds shall be
distributed to Buyer to the extent not expended by Seller for
restoration, and (b) the Purchase Price shall be reduced by
the amount of the uninsured portion of such loss (including
the amount of any deductible under any insurance policy
covering such loss).
11. Eminent Domain.
11.1. If, before the Close of Escrow, proceedings are commenced for
the taking by exercise of the power of eminent domain of all
or a material part of the Property which, as reasonably
determined by Buyer, would render the Property unacceptable to
Buyer or unsuitable for Buyer's intended use, Buyer shall have
the right, by giving notice to Seller within thirty (30) days
after Seller gives notice of the commencement of such
proceedings to Buyer, to terminate this Agreement, whereupon
the Due Diligence Items will be promptly returned to Seller,
the Refundable Deposit shall be returned to Buyer, the
Nonrefundable Deposit shall be retained by Seller and,
thereafter, neither Seller nor Buyer shall have any continuing
obligations hereunder, except as otherwise expressly provided
herein. If, before the Close of Escrow, proceedings are
commenced for the taking by exercise of the power of eminent
domain of less than such a material part of the Property, or
if Buyer has the right to terminate this Agreement pursuant to
the preceding sentence but Buyer does not exercise such right,
then this Agreement shall remain in full force and effect and,
at the Close of Escrow, the condemnation award (or, if not
therefore received, the right to receive such portion of the
award) payable on account of the taking shall be transferred
in the same manner as title to the Property is conveyed.
Seller shall give notice to Buyer within three (3) business
days after Seller's receiving notice of the commencement of
any proceedings for the taking by exercise of the power of
eminent domain of all or any part of the Property.
12. Notices.
12.1. All notices, demands, or other communications of any type
given by any party hereunder, whether required by this
Agreement or in any way related to the transaction contracted
for herein, shall be void and of no effect unless
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given in accordance with the provisions of this Paragraph. All
notices shall be in writing and delivered to the person to
whom the notice is directed, either in person, by United
States Mail, as a registered or certified item, return receipt
requested by telecopy or by Federal Express. Notices delivered
by mail shall be deemed given when received. Notices by
telecopy or Federal Express shall be deemed received on the
business day following transmission. Notices shall be given to
the following addresses:
Seller: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Triple Net Properties, LLC
▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇. #▇▇▇
▇▇▇▇▇ ▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
(▇▇▇)▇▇▇-▇▇▇▇ fax
With Required Copy to: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
The Federal Reserve Bank Building,
16th Floor
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇)▇▇▇-▇▇▇▇
(▇▇▇)▇▇▇-▇▇▇▇ fax
Buyer: Pacifica Real Estate Group, LLC
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇)▇▇▇-▇▇▇▇
Facsimile: (▇▇▇)▇▇▇-▇▇▇▇
With Required Copy to: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇, Esq.
Reicker, Pfau, ▇▇▇▇ & ▇▇▇▇▇, LLP
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
13. Remedies.
13.1. Defaults by Seller. If there is any default by Seller under
this Agreement, following notice to Seller and seven (7) days,
during which period Seller may cure the default, Buyer may, at
its option, (a) declare this Agreement terminated in which
case the Deposit shall be returned to Buyer or (b) treat this
Agreement as being in full force and effect and bring an
action against Seller for specific performance.
19
13.2. Defaults by Buyer. If there is any default by Buyer under this
Agreement, following notice to Buyer and seven (7) days,
during which period Buyer may cure the default (provided that
no such notice shall be required of Seller in order for a
Buyer default to be deemed to have occurred with respect to
any delivery (of documents or funds) required of Buyer at
Close of Escrow), then Seller may, as its sole remedy, declare
this Agreement terminated, in which case the Deposit shall be
paid to Seller as liquidated damages and each party shall
thereupon be relieved of all further obligations and
liabilities, except any which survive termination hereof. In
the event this Agreement is terminated due to the default of
Buyer hereunder, Buyer shall deliver to Seller, at no cost to
Seller, the Due Diligence Items and all of Buyer's Reports.
13.3. ARBITRATION OF DISPUTES. EXCEPT FOR ANY ACTION INVOLVING THE
EXERCISE OF EQUITABLE POWERS (INCLUDING AN ACTION FOR SPECIFIC
PERFORMANCE), ANY CLAIM, CONTROVERSY OR DISPUTE, WHETHER
SOUNDING IN CONTRACT, STATUTE, TORT, FRAUD, MISREPRESENTATION
OR OTHER LEGAL THEORY, RELATED DIRECTLY OR INDIRECTLY TO THIS
AGREEMENT, WHENEVER BROUGHT AND WHETHER BETWEEN THE PARTIES TO
THIS AGREEMENT OR BETWEEN ONE OF THE PARTIES TO THIS AGREEMENT
AND THE EMPLOYEES, AGENTS OR AFFILIATED BUSINESSES OF THE
OTHER PARTY, SHALL BE RESOLVED BY ARBITRATION AS PRESCRIBED IN
THIS SECTION. THE FEDERAL ARBITRATION ACT, 9 U.S.C. SECTIONS
1-15, NOT STATE LAW, SHALL GOVERN THE ARBITRABILITY OF ALL
CLAIMS, AND THE DECISION OF THE ARBITRATOR AS TO ARBITRABILITY
SHALL BE FINAL.
A SINGLE ARBITRATOR WHO IS A RETIRED FEDERAL OR CALIFORNIA JUDGE
SHALL CONDUCT THE ARBITRATION UNDER THE THEN CURRENT RULES OF THE
AMERICAN ARBITRATION ASSOCIATION (THE "AAA"). THE ARBITRATOR SHALL
BE SELECTED BY MUTUAL AGREEMENT ON THE ARBITRATOR WITHIN THIRTY (30)
DAYS OF WRITTEN NOTICE BY ONE PARTY TO THE OTHER INVOKING THIS
ARBITRATION PROVISION, IN ACCORDANCE WITH AAA PROCEDURES FROM A LIST
OF QUALIFIED PEOPLE MAINTAINED BY THE AAA. THE ARBITRATION SHALL BE
CONDUCTED IN SANTA ANA, CALIFORNIA AND ALL EXPEDITED PROCEDURES
PRESCRIBED BY THE AAA RULES SHALL APPLY.
THERE SHALL BE NO DISCOVERY OTHER THAN THE EXCHANGE OF INFORMATION
WHICH IS PROVIDED TO THE ARBITRATOR BY THE PARTIES. THE ARBITRATOR
SHALL HAVE AUTHORITY ONLY TO GRANT SPECIFIC PERFORMANCE AND TO ORDER
OTHER EQUITABLE
20
RELIEF AND TO AWARD COMPENSATORY DAMAGES, BUT SHALL NOT HAVE THE
AUTHORITY TO AWARD PUNITIVE DAMAGES OR OTHER NONCOMPENSATORY DAMAGES
OR ANY OTHER FORM OF RELIEF. THE ARBITRATOR SHALL AWARD TO THE
PREVAILING PARTY ITS REASONABLE ATTORNEYS' FEES AND COSTS AND OTHER
EXPENSES INCURRED IN THE ARBITRATION, EXCEPT THE PARTIES SHALL SHARE
EQUALLY THE FEES AND EXPENSES OF THE ARBITRATOR. THE ARBITRATOR'S
DECISION AND AWARD SHALL BE FINAL AND BINDING, AND JUDGMENT ON THE
AWARD RENDERED BY THE ARBITRATOR MAY BE ENTERED IN ANY COURT HAVING
JURISDICTION THEREOF.
14. Assignment.
Buyer may assign its rights under this Agreement to (a) an entity in which
Buyer has a significant interest (an "Affiliate"), or (b) an Affiliate and
to one or more entities that is purchasing its respective undivided
interest in the Property as a tenant in common with an Affiliate of Buyer;
provided, however, no such assignment shall relieve Buyer of its
obligations hereunder and the assignee must sign an assumption agreement
in form reasonably acceptable to Seller.
15. Interpretation and Applicable Law.
This Agreement shall be construed and interpreted in accordance with the
laws of the state in which the Property is located (the "State"). Where
required for proper interpretation, words in the singular shall include
the plural; the masculine gender shall include the neuter and the
feminine, and vice versa. The terms "successors and assigns" shall include
the heirs, administrators, executors, successors, and assigns, as
applicable, of any party hereto.
16. Amendment.
This Agreement may not be modified or amended, except by an agreement in
writing signed by the parties. The parties may waive any of the conditions
contained herein or any of the obligations of the other party hereunder,
but any such waiver shall be effective only if in writing and signed by
the party waiving such conditions and obligations.
17. Attorney's Fees.
In the event it becomes necessary for either party to file a suit or
arbitration to construe or enforce this Agreement or any provisions
contained herein, the prevailing party shall be entitled to recover, in
addition to all other remedies or damages, reasonable attorneys' fees and
costs of court incurred in such suit or arbitration.
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18. Entire Agreement; Survival.
This Agreement (and the items to be furnished in accordance herewith)
constitutes the entire agreement between the parties pertaining to the
subject matter hereof and supersedes all prior and contemporaneous
agreements and understandings of the parties in connection therewith. No
representation, warranty, covenant, agreement, or condition not expressed
in this Agreement shall be binding upon the parties hereto nor affect or
be effective to interpret, change, or restrict the provisions of this
Agreement. The obligations of the parties hereunder and all other
provisions of this Agreement shall survive the closing or earlier
termination of this Agreement, except as expressly limited herein.
19. Multiple Originals only; Counterparts.
Numerous agreements may be executed by the parties hereto. Each such
executed copy shall have the full force and effect of an original executed
instrument. This Agreement may be executed in any number of counterparts,
all of which when taken together shall constitute the entire agreement of
the parties.
20. Acceptance.
Time is of the essence of this Agreement. The date of execution of this
Agreement by Seller shall be the date of execution of this Agreement. If
the final date of any period falls upon a Saturday, Sunday, or legal
holiday under Federal law, the laws of the State or the laws of the State
of California if it is not the State, then in such event the expiration
date of such period shall be extended to the next day which is not a
Saturday, Sunday, or legal holiday under Federal law, the laws of the
State or the State of California if it is not the State.
21. Real Estate Commission.
Seller and Buyer each represent and warrant to the other that neither
Seller nor Buyer has contracted or entered into any agreement with any
real estate broker, agent, finder or any other party in connection with
this transaction, and that neither party has taken any action which would
result in any real estate broker's, finder's or other fees or commissions
being due and payable to any party with respect to the transaction
contemplated hereby, except that Seller has contracted with a) ▇▇▇▇▇ &
▇▇▇▇▇ and b) Triple Net Properties Realty, Inc., as its broker and will
pay any commission due to each such broker. Each party hereby indemnifies
and agrees to hold the other party harmless from any loss, liability,
damage, cost, or expense (including reasonable attorneys' fees) resulting
to the other party by reason of a breach of the representation and
warranty made by such party in this paragraph.
22
22. Exchange.
Each entity comprising Seller reserves the right to structure the sale of
the Property as a like kind exchange pursuant to Section 1031 of the Code.
In such event Seller shall have the right to assign its interest in this
Agreement to a qualified exchange intermediary of its choosing to effect
such exchange. Buyer shall sign a customary assignment and/or notice of
assignment, however, such assignment shall be at no cost or expense to
Buyer and shall not otherwise affect the terms of this Agreement.
23. Confidentiality.
Buyer agrees that, prior to the closing, all Property information received
by Buyer shall be kept confidential as provided in this paragraph. Without
the prior written consent of Seller, prior to the closing, the Property
information shall not be disclosed by Buyer or its representatives, in any
manner whatsoever, in whole or in part, except (1) to Buyer's
representatives who need to know the Property information for the purpose
of evaluating the Property and who are informed by the Buyer of the
confidential nature of the Property information; (2) as may be necessary
for Buyer or Buyer's representatives to comply with applicable laws,
including, without limitation, governmental, regulatory, disclosure, tax
and reporting requirements; to comply with other requirements and requests
of regulatory and supervisory authorities and self-regulatory
organizations having jurisdiction over Buyer or Buyer's representatives;
to comply with regulatory or judicial processes; or to satisfy reporting
procedures and inquiries of credit rating agencies in accordance with
customary practices of Buyer or its affiliates; and (3) to prospective
tenants of the Property; and (4) to prospective investors and permitted
assignees of Buyer's rights hereunder (as permitted pursuant to Section 14
hereof). Buyer hereby agrees to indemnify, defend, and hold Seller free
and harmless from and against any and all liabilities (including
reasonable attorneys' fees, expenses and disbursements) incurred by Seller
directly arising out of or resulting from (a) the breach of the terms of
this paragraph or (b) the offering, underwriting or promotion by Buyer (or
its Affiliates) of any syndication of or investment in the Property or the
solicitation of investors or potential tenant-in-common owners of the
Property.
24. Approval.
Seller's obligation to sell the Property is subject to the condition
precedent that approval of the sale is obtained from all entities
comprising Seller no later than fifteen (15) business days after full
execution of this Agreement.
THE BALANCE OF THIS PAGE IS INTENTIONALLY LEFT BLANK
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SIGNATURE PAGE FOR
City Center West Building A
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇.,
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇
EXECUTED on this the 15 day of July, 2005.
SELLER:
▇▇▇▇▇ - City Center West A, LLC, a Nevada limited
liability company
By: Triple Net Properties, LLC, a Virginia limited
liability company, Manager
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Chief Executive Officer
NNN City Center West A1, LLC, a Nevada
limited liability company
By: Triple Net Properties, LLC,
a Virginia limited liability company, Manager
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Chief Executive Officer
NNN City Center West A3, LLC, a
Nevada limited liability company
By: Triple Net Properties, LLC,
A Virginia limited liability company, Manager
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Chief Executive Officer
24
NNN City Center West A4, LLC, a
Nevada limited liability company
By: Triple Net Properties, LLC, a
Virginia limited liability company, Manager
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Chief Executive Officer
EXECUTED on this the 13 day of July, 2005.
BUYER:
PACIFICA REAL ESTATE GROUP, LLC,
a California limited liability company
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Senior Vice President
25