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EXHIBIT 10.17
CONTRACT OF SALE
between
ROSEMEADE PARK LIMITED PARTNERSHIP
SELLER
AND
UNITED INVESTORS REALTY TRUST
BUYER
pertaining to the sale and purchase of
ROSEMEADE PARK SHOPPING CENTER
CARROLLTON, TEXAS
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CONTRACT OF SALE
This Contract of Sale (the "Contract") is made and entered into by and
between ROSEMEADE PARK LIMITED PARTNERSHIP, a Texas limited partnership having
its principal office at c/o United Commercial Development, Inc., ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ ("Seller"), and UNITED INVESTORS REALTY
TRUST, a Texas real estate investment trust having its principal office at ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ ("Buyer").
ARTICLE I
DEFINED TERMS
1.1 Definitions. As used herein, the following terms shall have
the meanings set forth below:
"Anchor Tenant" means any Tenant at the Project that (i) leases and
occupies 8,000 square feet or more at the Project, (ii) leases and occupies
more space than any other Tenant at the Project, or (iii) leases and occupies
space in at least 25 other shopping centers throughout the United States (i.e.,
with the last alternative not being applicable to a franchisee unless the
franchisee itself leases and occupies space in at least 25 other shopping
centers throughout the United States).
"Business Day" means any day other than a Saturday or Sunday on which
Federal Savings Banks in Dallas, Texas are open for business.
"Closing" means consummation of the purchase of the Project by Buyer
from Seller in accordance with the terms and conditions of Article VIII.
"Closing Date" means the date specified in Section 8.1 on which the
closing will be held.
"Contract Date" means the later of the two dates set forth immediately
above each of the signatures of the parties hereto, on the signature page
hereof.
"▇▇▇▇▇▇▇ Money Deposit" means the moneys deposited by Buyer in escrow
with the Title Company at the time and in the amount specified in Section 3.2.
"Improvements" means the neighborhood shopping center (the "Shopping
Center") known as Rosemeade Park Shopping Center, containing approximately
49,500 square feet of improved retail space, located in Carrollton, Texas, the
fixtures and other improvements now or hereafter situated upon the tract of
land described on Exhibit "A".
"Inspection Period" means the period commencing on the Contract Date
and ending thirty (30) days thereafter.
"Land" means that certain tract of land located in ▇▇▇▇▇▇ County,
Texas, and being more fully described on Exhibit "A", together with all rights
appurtenant thereto.
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"Leases" means all currently effective leases for space in the
Improvements, including all amendments and modifications thereto and any and
all other agreements with Tenants.
"Permitted Exceptions" means those exceptions or conditions that
affect or may affect title to the Project that are approved or deemed to be
approved by Buyer in accordance with Section 4.3 or Section 4.4.
"Personal Property" means (a) all tangible personal property, if any,
owned by Seller and located on or attached to the Real Property (but not
including any tangible personal property owned or leased by Tenants), (b)
Seller's interest in all personal property leases, licenses, permits, plans,
studies, and utility arrangements with respect to the Real Property, (c)
Seller's interest in all service, maintenance, management or other contracts
relating to the ownership or operation of the Real Property, (d) Seller's
interest in all warranties and guaranties, if any, relating to the Real
Property and the Trade Names, and (e) Seller's interest, if any, in the Trade
Name.
"Project" means, collectively, the Real Property, the Leases, and the
Personal Property for the Shopping Center.
"Purchase Price" means the total consideration to be paid by Buyer to
Seller for the purchase of the Project.
"Real Property" means the Land and the Improvements for the Shopping
Center.
"Rent Roll" means a schedule for the Project identifying the Tenants
at the Project and providing certain information with respect to the Leases in
accordance with Section 5.2 (a)(iii).
"Tenants" means those persons holding rights as tenants of the
Shopping Center.
"Title Company" means Republic Title of Texas, Inc., having its
principal office at ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Escrow Officer.
"Title Underwriter" means Lawyer's Title Insurance Corporation.
"Trade Name" means the name "Rosemeade Park Shopping Center", as well
as any other name utilized in conjunction with the operation of the Project.
1.2 Other Defined Terms. Certain other defined terms shall have
the respective meanings assigned to them elsewhere in this Contract.
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ARTICLE II
AGREEMENT OF PURCHASE AND SALE
On the terms and conditions stated in this Contract, Seller hereby
agrees to sell and convey to Buyer, and Buyer hereby agrees to purchase and
acquire from Seller, the Project.
ARTICLE III
PURCHASE PRICE
3.1 Purchase Price. The Purchase Price (herein so called) to be
paid by Buyer to Seller shall be Four Million Six Hundred Thousand and No/100
Dollars ($4,600,000.00). The Purchase Price, net of all prorations set forth
in this Contract, shall be payable to Seller through the Title Company at the
Closing as follows:
(a) Buyer shall accept title to the Project subject to, without
assumption of, or agreement to pay or indemnifying Seller for (except for the
matters described in Section 5.3(a) hereof), the then current balance of that
certain first lien promissory note (the "Existing Note") as of the Closing
Date, which is described below, which note is secured by the following
described existing first lien created by that certain deed of trust (the
"Existing Lien") of even date therewith, to-wit:
Promissory Note in the original principal sum of $3,500,000, executed
by Seller, made payable to the order of HSA/Wexford Bancgroup, L.L.C.
(the "Lender"), dated as of November 10, 1997, secured by a deed of
trust to ▇▇▇▇▇ ▇. ▇▇▇▇, Trustee, also dated as of November 10, 1997,
against the Project, such deed of trust having been recorded in the
Deed of Trust Records of ▇▇▇▇▇▇ County, Texas.
(b) The difference between the Purchase Price and the aggregate
unpaid principal balance of the Existing Note as of the Closing Date, shall be
paid in cash to Seller at the Closing, subject to prorations and other credits
provided for in this Contract.
3.2 ▇▇▇▇▇▇▇ Money Deposit. Within three (3) business days after
the Contract Date, Buyer shall deliver the sum of Fifty Thousand and No/100
Dollars ($50,000.00) as an ▇▇▇▇▇▇▇ money deposit (the "▇▇▇▇▇▇▇ Money Deposit")
in cash to the Title Company. The ▇▇▇▇▇▇▇ Money Deposit shall thereafter be
held by the Title Company in escrow to be applied or disposed of by it as is
provided in this Contract. Provided that Buyer complies with the Title
Company's reasonable escrow requirements (e.g., supplying Buyer's taxpayer
identification number), the ▇▇▇▇▇▇▇ Money Deposit shall be deposited in an
interest-bearing account in a federally insured financial institution located
in Dallas County, Texas, reasonably acceptable to the Buyer. All interest
earned thereon shall become part of the ▇▇▇▇▇▇▇ Money Deposit. If the purchase
and sale hereunder are consummated in accordance with the terms and conditions
hereof, the ▇▇▇▇▇▇▇ Money Deposit shall be applied to the Purchase Price at the
Closing. In all other events, the ▇▇▇▇▇▇▇ Money Deposit shall be disposed of
by the Title Company as provided elsewhere in this Contract.
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ARTICLE IV
TITLE AND SURVEY AND INSPECTION
4.1 Title Commitment. Within three (3) days after the Contract
Date, Seller shall order, at its sole cost and expense, a current commitment
for Title Insurance for the Project (the "Title Commitment") countersigned by
the Title Company, as agent for the Title Underwriter, which Title Commitment
shall be furnished to Buyer. The Title Commitment shall contain the express
commitment of the Title Company to issue a Texas Form T-1 Owner's Policy of
Title Insurance to the extent permitted by Texas law for the Project, which
shall otherwise be in form and content consistent with paragraphs 4.3 and 4.4
below. The Title Commitment shall be accompanied by legible copies of all
instruments that create or evidence title exceptions affecting the Real
Property.
4.2 Survey. Within three (3) days after the Contract Date, Seller
shall order, at its sole cost and expense, a survey for the Project (the
"Survey") to be furnished to Buyer. The Survey shall be an update of the
October 1997 as-built survey prepared by ▇▇▇▇▇▇ Engineering Inc. for the
Project (▇▇▇▇▇▇ File No. 962-105) (the "Existing Survey"), which Buyer
acknowledges having received prior to the Contract Date. The Existing Survey
shall be updated to a date subsequent to the Contract Date and shall be
certified to Buyer and the Title Company. The Survey certification shall be in
the same form as the certification on the Existing Survey. The metes and
bounds description of the Land contained in the Survey, if different from that
attached as Exhibit "A" hereto, shall be used for purposes of describing the
Real Property in the special warranty deed conveying title to the Real Property
from Seller to Buyer.
4.3 Review of Title Commitment and Survey. Buyer shall have a
period of fourteen (14) days (the "Title Review Period") after Seller's
delivery to Buyer of both the Title Commitment in accordance with paragraph 4.1
above, in which to review the Title Commitment and the Existing Survey and give
written notice to Seller specifying Buyer's objections (the "Objections"), if
any, to the Title Commitment and the Existing Survey; moreover, if the Survey
shows any encumbrances that were not shown on the Existing Survey, then as to
those encumbrances (and only those encumbrances) the Title Review Period shall
be extended to seven (7) days after Buyer's receipt of the Survey. If Buyer
shall fail to give written notice of Objections to Seller prior to the
expiration of the Title Review Period, then all exceptions to title shown on
Schedule B of the Title Commitment shall be deemed to be Permitted Exceptions.
Buyer agrees that the Existing Lien and the lien for 1998 ad valorem taxes
shall be Permitted Exceptions, and Seller agrees that no other lien (i.e.,
other than the Existing Lien and the lien for 1998 ad valorem taxes) shall be a
Permitted Exception.
4.4 Seller's Obligation to Cure; Buyer's Right to Terminate. If
Buyer shall have timely notified Seller in writing of Objections to the Title
Commitment or the Survey, then Seller may, but shall not be obligated to, at
any time prior to the expiration of the Inspection Period (the "Cure Period"),
give written notice ("Seller's Title Cure Notice") to Buyer of Seller's
intention to satisfy the Objections prior to Closing. If Seller fails to timely
give Buyer the Seller's Title Cure Notice, then Buyer shall have the option,
prior to the conclusion of the Inspection Period, to either (i) waive the
unsatisfied Objections, in which event those unsatisfied Objections shall
become Permitted Exceptions, or (ii) terminate this Contract, in which event
the ▇▇▇▇▇▇▇ Money Deposit shall be
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returned to Buyer and Seller and Buyer shall have no further obligations, one
to the other, with respect to the subject matter of this Contract; and in this
regard, if Buyer delivers a Notice to Continue pursuant to paragraph 4.6 below,
then Buyer shall conclusively be deemed to have elected alternative (i).
4.5 Owner's Title Policy. At the Closing, Seller shall cause a
standard T-1 form Owner's Policy of Title Insurance (the "Owner's Title
Policy") to be furnished to Buyer by the Title Company. The Owner's Title
Policy shall be issued by the Title Underwriter and shall insure that Buyer has
good and indefeasible fee simple title to the Project, subject only to (i)
rights of tenants in possession, as tenants only, (ii) visible and apparent
easements which are shown on the Survey, and (iii) the Permitted Exceptions.
At Buyer's option and cost, the "survey exception" in the Owner's Title Policy
shall be modified to read "shortages in area only". The tax exception shall be
limited to taxes for the year of Closing and subsequent years not yet due and
payable and subsequent assessments for prior years due to change in land usage
or ownership. The basic premium for the Owner's Title Policy shall be paid by
Seller or, at Buyer's option, the cost of the Owner's Title Policy shall be
credited against the Purchase Price, in which event the requirement for title
insurance shall be waived.
4.6 Inspection.
(a) Buyer shall have the right, during the Inspection Period, to
make such examinations, studies, tenant credit checks, appraisals, inspections,
engineering, environmental and insurance underwriting tests and investigations
(the "Inspections") of the Project as Buyer may deem advisable. Such
Inspections shall include, without limitation, review of current operating
statements, operating statements for calendar year 1997 and the prior two
calendar years (to the extent available), current rent roll, true copies of the
latest real estate tax bills, true and complete copies of all service contracts
affecting the Project, and any and all other contracts and agreements relating
to the Project. Seller shall cooperate with Buyer in making available the
Project for Buyer's Inspections, including any and all books and records
relating thereto. Buyer shall not inspect any Tenant's premises without being
accompanied by a representative of Seller. Buyer may also reinspect the
Project prior to Closing to verify that the Project has remained in the same
physical shape, ordinary wear and tear excepted, as the Project was during the
Inspection Period.
(b) If Buyer elects for this Contract to remain in full force and
effect beyond the Inspection Period, then Buyer, at its sole option, may
deliver written notice (the "Notice to Continue") thereof to Seller and Title
Company, on or before the expiration of the Inspection Period. Once the Notice
to Continue has been given, the ▇▇▇▇▇▇▇ Money Deposit shall become at risk.
If, however, Buyer does not timely deliver the Notice to Continue, or if Buyer
notifies Seller and Title Company that Buyer has no further interest in
purchasing the Project, then, in either event, the ▇▇▇▇▇▇▇ Money Deposit shall
be returned to Buyer, and thereafter Seller and Buyer shall have no further
obligations, one to the other, with respect to the subject matter of this
Contract.
(c) Buyer shall indemnify and hold harmless the Seller from and
against all loss, liability, damage, injury and claims resulting from Buyer's
testing or inspection of the Project; provided, however, this indemnity shall
not include, and shall specifically exclude, any loss, liability, damage
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etc. arising out of or resulting from Seller's negligence, gross negligence or
willful misconduct and the discovery of any condition that may require
remediation under applicable environmental laws. This indemnity shall survive
the Closing or termination of this Contract for a period of six months, after
which this indemnity shall automatically terminate.
ARTICLE V
REPRESENTATIONS, WARRANTIES, COVENANTS,
AND AGREEMENTS OF SELLER
5.1 Representations and Warranties of Seller; Disclaimer.
Seller's representations and warranties set forth in this Contract are true and
correct in all material respects as of the Contract Date and will be true and
correct in all material respects on the Closing Date. Such representations and
warranties, as they relate to facts that exist on the Closing Date, shall
survive the Closing and shall not be merged therein, except to the extent
actually known by Buyer to be incorrect as to the Closing Date. Seller hereby
represents and warrants to Buyer as follows:
(a) Seller has the full right, power, and authority to sell and
convey to Buyer the Project as provided in this Contract and to carry out
Seller's obligations hereunder, and all requisite action necessary to authorize
Seller to enter into this Contract and to carry out Seller's obligations
hereunder has been, or on the Closing Date will have been, taken; this Contract
constitutes a valid and binding obligation of Seller;
(b) Seller has no current actual knowledge of any adverse or other
parties in possession of the Project, or of any part thereof as lessees,
tenants at sufferance, or trespassers, except Tenants referenced in the Rent
Roll to be delivered pursuant to Section 5.2(a);
(c) Seller has not received written notice from any governmental
or quasi-governmental agency or insurance underwriter requiring or suggesting
that Seller should correct any condition with respect to the Project, which
condition remains uncorrected;
(d) Seller has not received written notice of any pending
condemnation action with respect to all or any portion of the Project, and
there is no existing condemnation or other legal proceedings relating to all or
any portion of the Project by any governmental authority having jurisdiction
over all or any part of the Project;
(e) There is no litigation pending against Seller or the Project
other than as may be incurred in the normal course of business and with respect
to which Seller's insurance underwriter(s) is responsible or with respect to
which Seller shall indemnify and hold harmless Buyer from and after the Closing
Date; and Seller has no current actual knowledge that any such litigation has
been threatened;
(f) Seller has no current actual knowledge of any unpaid
assessments (governmental or otherwise) for sewers, water, paving, electrical
power or otherwise which have been assessed against the Project;
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(g) At the Closing, there will be no unpaid bills or claims in
connection with any repair of the Improvements or other work performed or
material purchased in connection with the Improvements, or in the alternative
Seller shall indemnify Buyer from any such ▇▇▇▇ or claim;
(h) The Service Contracts, Leases and other agreements delivered
to Buyer pursuant to this Contract constitute all contracts, leases or
agreements affecting the Project (and the ownership and use thereof); the
Ownership Documents delivered pursuant to Section 5.2 herein are true and
correct copies of the originals and no other amendments or modifications exist
thereto; and each of the Service Contracts (as that term is defined in Section
5.2(a)(vi)) pertaining to the Project is terminable without cause prior to the
Closing Date;
(i) Based on currently applicable taxes known to Seller, Seller
has paid all taxes, charges, and assessments (special or otherwise) required to
be paid to any taxing authority with respect to the Project (except for taxes
and assessments for the current year not yet delinquent);
(j) The executed Leases, which are to be delivered to Buyer at
Buyer's principal office in accordance with the terms of this Contract, are and
shall be true and correct originals. No Leases shall be further modified or
amended in any material respect without the prior written consent of Buyer,
which consent shall not be unreasonably withheld or delayed. Except as may be
reflected on the current Rent Roll to be delivered to Buyer pursuant to the
provisions of Section 5.2 below, (1) no Tenant has given Seller notice of its
intention to vacate its leased premises prior to the end of the primary term,
(2) no Tenants are or shall be entitled to any rebates, allowances, rent
concessions or free rent for any period subsequent to the Closing, (3) all of
the Leases are in full force and effect without current default by Seller or,
to the knowledge of Seller, the respective Tenants, (4) All obligations and
items of an inducement nature to be performed by the Seller as landlord under
any of the Leases or to which Seller otherwise agreed to perform have been
fully performed and no commitments have been made to any Tenant for repairs or
improvements other than a general landlord requirement for normal maintenance
in the future; (5) there are no pending claims asserted by any past or present
Tenants for offsets against rent or any other claims (whether monetary or
otherwise) made against Seller, as landlord, under the Leases or otherwise; and
(6) there are no fees or commissions payable to any person or entity in regard
to the Leases or the Project;
(k) All financial and operating statements, rent rolls, contracts,
agreements and books and records delivered by Seller to Buyer relating to
Seller and its business are accurate and complete in all material respects;
(l) Seller has full right, title and authority to enter into this
Contract, without the joinder or consent of any other party, and that no other
party has any right, option, interest, or claim to all or any part of the
Project (i.e., except the Tenants' rights, as tenants only, under the Leases),
whether subject to ▇▇▇▇▇▇▇ money contract, option agreement, right of first
refusal, reversionary or future interests, or right of reverter; and
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(m) Seller is not a foreign person or entity pursuant to the
Foreign Investment in Real Property Tax Act, or the Tax Reform Act of 1986, and
Buyer is not obligated to withhold any portion of the Purchase Price for the
benefit of the Internal Revenue Service.
BUYER ACKNOWLEDGES AND AGREES THAT EXCEPT AS EXPRESSLY STATED IN THIS CONTRACT,
SELLER HAS NOT MADE, DOES NOT MAKE -- AND, IN FACT, SPECIFICALLY DISCLAIMS --
ANY REPRESENTATIONS, WARRANTIES, PROMISES, COVENANTS, AGREEMENTS OR GUARANTIES
OF ANY KIND OR CHARACTER WHATSOEVER, WHETHER EXPRESS OR IMPLIED, ORAL OR
WRITTEN, PAST, PRESENT OR FUTURE, OF, AS TO, CONCERNING OR WITH RESPECT TO (A)
THE NATURE, QUALITY OR CONDITION OF THE PROJECT, (B) THE INCOME TO BE DERIVED
FROM THE PROJECT, (C) THE SUITABILITY OF THE PROJECT FOR ANY AND ALL ACTIVITIES
AND USES WHICH BUYER MAY CONDUCT THEREON, (D) THE COMPLIANCE OF OR BY THE
PROJECT OR ITS OPERATION WITH ANY LAWS, RULES, ORDINANCES OR REGULATIONS OF ANY
APPLICABLE GOVERNMENTAL AUTHORITY OR BODY, (E) THE HABITABILITY,
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OF THE PROJECT, OR (F) ANY
OTHER MATTER WITH RESPECT TO THE PROJECT. SPECIFICALLY, AND WITHOUT LIMITING
THE GENERALITY OF THE FOREGOING, SELLER HAS NOT MADE, DOES NOT MAKE AND
SPECIFICALLY DISCLAIMS ANY REPRESENTATIONS REGARDING SOLID WASTE, AS DEFINED BY
THE U.S. ENVIRONMENTAL PROTECTION AGENCY REGULATIONS AT 40 C.F.R., PART 261, OR
THE DISPOSAL OR EXISTENCE, IN OR ON THE PROJECT, OF ANY HAZARDOUS SUBSTANCE, AS
DEFINED BY THE COMPREHENSIVE ENVIRONMENTAL RESPONSE COMPENSATION AND LIABILITY
ACT OF 1980, AS AMENDED, AND APPLICABLE STATE LAWS, AND REGULATIONS PROMULGATED
THEREUNDER. BUYER FURTHER ACKNOWLEDGES AND AGREES THAT HAVING BEEN GIVEN THE
OPPORTUNITY TO INSPECT THE PROJECT, BUYER IS RELYING SOLELY ON ITS OWN
INVESTIGATION OF THE PROJECT AND NOT ON ANY INFORMATION PROVIDED OR TO BE
PROVIDED BY SELLER. BUYER FURTHER ACKNOWLEDGES AND AGREES THAT ANY INFORMATION
PROVIDED OR TO BE PROVIDED WITH RESPECT TO THE PROJECT WAS OBTAINED FROM A
VARIETY OF SOURCES AND THAT SELLER HAS NOT MADE ANY INDEPENDENT INVESTIGATION
OR VERIFICATION OF SUCH INFORMATION. BUYER FURTHER ACKNOWLEDGES AND AGREES
THAT THE SALE OF THE PROJECT AS PROVIDED FOR HEREIN IS MADE ON AN "AS IS, WHERE
IS" CONDITION AND BASIS "WITH ALL FAULTS," EXCEPT TO THE EXTENT EXPRESSLY
STATED OTHERWISE IN THIS CONTRACT.
5.2 Covenants and Agreements of Seller. Seller covenants and
agrees with Buyer as follows:
(a) Within five (5) business days following the Contract Date,
Seller shall deliver to Buyer the following items (the "Ownership Documents")
with respect to the Project:
(i) If and to the extent that Seller has in its
possession, copies of "as-built" plans and specifications for
the Improvements and copies of the results of all
environmental, physical inspections, all structural,
mechanical, engineering reports,
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soil reports and traffic studies that may have been prepared
with respect to the Real Property (if any);
(ii) Current certificates of occupancy in the name of the
Seller and building permits (if available) for each building
within the Project, and, to the extent that Seller has in its
possession, a current phase I environmental report and ADA
study;
(iii) Current Rent Roll for the Project, which Rent Roll
shall set forth with respect to each Tenant the following;
(A) the name and street or unit number of the Tenant;
(B) the term of the Tenant's Lease, its commencement
and expiration dates, any renewal terms or extensions and
the base rent and percentage rent, if any, payable
thereunder;
(C) the amount of monthly base rent and percentage
rent, if any, payable by and portion of the Project's CAM
and real estate taxes and insurance premiums recoverable
from each Tenant and any other payments for which such
Tenant is liable;
(D) amount of prepaid rent and the amount of security
and other deposits due under the Lease and held by
Landlord;
(E) the amount of any ongoing Lease commission
obligations, if any, and to whom such commission is owed
and copies of all brokerage commission agreements relating
to the Leases;
(F) any uncured defaults and the amounts of any
unpaid rents, percentage rents, and other payments past
due thereunder;
(G) the amount of any offsets or credits against
rental, if any; and
(H) any concessions granted to the Tenant, including,
without limitation, free rent, rental rebates or credits,
lease take-over arrangements, cash payments, and moving
allowances;
(iv) Copy of the most recent or current real estate and
personal property tax bills or other documentation showing the
amount of current real property taxes and the assessed value
of the Project;
(v) A schedule setting forth property and liability
insurance coverage on or affecting the Project and the current
premiums therefor together with a written summary of all
claims, if any, made against the Project's insurance policies
since January 1, 1997.
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(vi) Copies of all existing service, maintenance,
operations, and management and other contracts relating to the
management, operation or maintenance of the Project (the
"Service Contracts"), and any commission agreements affecting
the Project;
(vii) Copies of true and correct operating income and
expense statements with respect to the Project, accurately
reflecting the operating history of the Project for calendar
years 1995 and 1996 and for year-to-date 1997, together with
operating budgets for calendar year 1997 for the Project;
(viii) A detailed summary of all capital expenditures for the
calendar years 1995 and 1996, and year-to-date 1997, together
with the capital expenditure budgets for calendar year 1997
for the Project;
(ix) All warranties and guaranties currently in force, if
any, relating to the Project or any equipment, appliances or
other personalty located in or used on the Real Property and
in the possession of Seller or its agents; and
(x) True and complete copies of all Leases, including all
amendments, extensions and modifications thereof, and the
Existing Note and all instruments securing the Existing Note,
including the instruments evidencing the Existing Lien, and
all amendments, extensions and modifications thereof.
All materials delivered by Seller to Buyer pursuant to this Section 5.2(a)
shall be held in confidence by Buyer and disclosed only to its attorneys,
accountants, and prospective lenders and securities underwriters and their
respective attorneys. If the parties fail to consummate the transaction
described herein for any reason other than the Seller's default, Buyer shall
return to Seller all materials delivered by or on behalf of Seller pursuant to
or in connection with this Contract.
(b) Seller undertakes and agrees, with respect to the Project,
that it will:
(i) From the Contract Date until the Closing Date,
operate and maintain the Project in a manner consistent with
its current practices;
(ii) From the Contract Date until the Closing Date,
promptly notify Buyer in writing of any litigation,
arbitration or administrative hearing before any court or
governmental agency concerning or affecting the Project and
actually known by Seller, which is instituted or threatened
after the Contract Date, and any new leases, or assignments or
amendments to any existing Leases, and deliver copies thereof
to Buyer, prior to their execution by Seller;
(iii) From the tenth (10th) day prior to the expiration of
the Inspection Period until the Closing Date, not modify any
Lease in any material respect (ie., if such modification
changes the information set forth in the Rent Roll as to such
Lease), nor terminate any Lease for any reason other than a
Tenant's failure to pay rent, nor
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commence any judicial action against any Tenant other than in
the normal course of business without the prior written
consent of Buyer, which consent shall not be unreasonably
withheld or delayed;
(iv) From the tenth (10th) day prior to the expiration of
the Inspection Period until the Closing Date, not execute any
new lease or agree to the terms of any lease renewal without
the prior written consent of the Buyer, which consent shall
not be unreasonably withheld or delayed;
(v) From the Contract Date until the Closing Date,
promptly notify Buyer in writing of any notice received from a
Tenant of its election to vacate its leased premises or
terminate its Lease, or of any election by Seller to terminate
any Lease by reason of tenant's default or commence any
judicial action against any Tenant;
(vi) From the Contract Date until the Closing Date, not
sell, exchange, transfer, assign, convey or encumber or
otherwise dispose of all or any part of the Project or any
interest therein (except for new leases which Seller is
otherwise entitled to enter into under the terms hereof, or
Buyer is entitled to approve under subsection (iv) of this
section), nor shall Seller remove any Personal Property unless
Seller shall replace the removed items with similar items of
comparable quality;
(vii) From the Contract Date until the Closing Date,
maintain the Project in a condition and repair comparable to
its current condition and repair, except for normal wear and
tear;
(viii) From the Contract Date until the Closing Date, there
will be no rental or other concessions of any nature granted
to any Tenant other than those set forth in the Leases and on
the Rent Roll delivered to Buyer pursuant to Section 5.2
(a)(ii), above;
(ix) From the Contract Date until the Closing Date,
promptly notify Buyer in writing if Seller discovers any
material defect, error or omission in any of the Ownership
Documents, detailing the nature of the defect, error or
omission;
(x) From the Contract Date until the Closing Date, not,
without the prior written consent of the Buyer, enter into or
modify any Service Contracts which are not terminable without
cause on or before the Closing Date; or
(xi) From the tenth (10th) day prior to the expiration of
the Inspection Period until the Closing Date, not, without the
prior written consent of Buyer, which consent shall not be
unreasonably withheld or delayed, consent to any assignment or
sublease or other encumbrance by a Tenant of its interest, or
any part thereof, in its Lease, except as may be required by
the terms of the Lease.
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5.3 Agreements Concerning Existing Note.
(a) Notwithstanding anything to the contrary contained herein, in
the Existing Note, the Existing Lien, or in any other document or agreement
made or executed in connection herewith or therewith, it is agreed that Buyer
shall accept the Project subject to, but shall not assume, payment of the
Existing Note and performance of the agreements of the Existing Liens and any
other instrument securing the payment of the Existing Note; provided however,
Buyer agrees to assume all obligations under the Existing Note, Existing Lien
and other related documents for which Seller is obligated to perform or pay.
(b) At the Closing, Seller agrees to obtain from the holder of the
Existing Note (the "Lender") a Lender's Consent and Estoppel (herein so
called) signed by the Lender, confirming that it has no objection to the sale
to Buyer of the Project, subject to the unpaid principal balance of the
Existing Note as of the Closing Date, without the assumption of liability for
the payment of the Existing Note or any other instrument securing the Existing
Note. Further, the Lender's Consent and Estoppel shall state as of the date
not earlier than the first day of the month in which this Contract is closed,
the following:
(i) The unpaid balance of principal and accrued interest
on the Existing Note;
(ii) That there are no past due payments either of
principal or interest owing on the Existing Note;
(iii) That to the current actual knowledge of the Lender
(without any investigation), there are no uncured defaults
under the Existing Lien or any other instrument securing the
Existing Note;
(iv) That the Existing Note, the Existing Lien and all
other instruments securing the Existing Note are, to the
current actual knowledge of Lender (without any
investigation), presently in full force and effect;
(v) The amount of any impounds held by the Lender for
payment of insurance premiums or ad valorem taxes or other
expenses related to the Project and the Existing Lien securing
same; and
(vi) The amount of each monthly payment and the amount of
monthly impounds.
Buyer agrees to provide Lender with all available information
reasonably needed to obtain the Lender's Consent and Estoppel from the Lender.
(c) Buyer agrees to pay to Lender up to $17,500 of the transfer
fee or other costs charged by the Lender, in connection with its agreement to
permit the transfer of the Project to the Buyer and obtaining the Lender's
Consent and Estoppel, and Seller is obligated to pay any such fees or costs in
excess thereof.
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(d) Seller shall not, at any time, either prior to or after
Closing, alter, renew, rearrange, restructure or refinance any indebtedness
evidenced by the Existing Note or modify the Existing Note or any instrument
securing the Existing Note, without the prior written consent of Buyer; and
Seller shall neither accept nor request any extension, postponement, indulgence
or forgiveness of the Existing Note or the indebtedness evidenced thereby,
without the prior written consent of Buyer.
5.4 Survival Beyond Closing. All of the representations and
warranties deemed remade at Closing shall survive Closing but Buyer shall be
deemed to have waived any and all rights in respect to the breach thereof
unless Buyer gives written notice of the alleged breach thereof within six (6)
months following Closing and, further, Buyer shall have waived all rights with
respect to all matters specified in any such written notice unless Buyer has
instituted litigation in respect thereto within one (1) year following Closing.
ARTICLE VI
REPRESENTATIONS, WARRANTIES, COVENANTS AND
AGREEMENTS OF BUYER
Buyer represents, warrants, covenants, and agrees with, Seller as of
the Contract Date, that:
(a) Buyer has the full right, power, and authority to purchase the
Project from Seller as provided in this Contract and to carry out Buyer's
obligations under this Contract, and all requisite action necessary to
authorize Buyer to enter into this Contract and to carry out Buyer's
obligations hereunder has been, or on the Closing Date will have been, taken;
and
(b) Buyer acknowledges that Buyer has been advised in writing that
Buyer should have an abstract covering the Land examined by an attorney of
Buyer's own selection or that Buyer should be furnished with or obtain a policy
of title insurance.
ARTICLE VII
CONDITIONS PRECEDENT TO BUYER'S PERFORMANCE
7.1 Conditions Precedent to Buyer's Obligations. Buyer shall not
be obligated to consummate the transaction described in this Contract unless:
(a) Seller shall have furnished or caused to be furnished to Buyer
the Lender's Consent and Estoppel described in Section 5.3;
(b) Seller shall have performed in all material respects all of
the agreements, covenants and obligations contained in this Contract to be
performed or complied with by Seller on or prior to the Closing Date;
(c) All representations and warranties made by Seller hereunder
shall be accurate and complete (as to the items covered therein) in all
material respects as of the Closing Date;
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(d) The Title Company shall be prepared to deliver at Closing the
Owner's Title Policy described in Section 4.5;
(e) No Anchor Tenant shall be in default under its Tenant Lease
and all Service Contracts will terminate as of the Closing Date, except to the
extent that Buyer has notified Seller in writing that it will accept an
assignment of such contracts, as contemplated by Section 8.2(a)(vi) hereof;
(f) Tenant estoppel certificates or letters shall have been
received by Buyer from (i) all of the Anchor Tenants, and (ii) at least 75% (by
square footage at the Project), of the non-anchor tenants at the Project, which
estoppel certificates or letters shall confirm the Tenant-based information set
forth on the Rent Roll delivered (A) as part of the Ownership Documents, as
modified to reflect any non-substantive changes thereto, or (B) with respect to
Tenants who have executed new leases since the Contract Date, as reflected on
the Rent Roll to be delivered in connection with the Closing; and as to the
remaining 25% of the non-anchor tenants, either Tenant Estoppel Certificates
have been received by Buyer or Seller has certified in writing the same
information set forth in the Estoppel Certificates as to such remaining
non-anchor tenants; and
(g) There shall be no material change in the matters reflected in
the Title Commitment or Survey.
7.2 Termination if Conditions Precedent not Satisfied or Waived.
If any of the conditions precedent to the performance of Seller's obligations
under this Contract have not been satisfied, waived, or deemed waived by the
Buyer within the time frame established herein or otherwise by the Closing
Date, then the Buyer may, at its option, by written notice delivered to the
obligated party and Title Company, terminate this Contract, in which event the
▇▇▇▇▇▇▇ Money Deposit shall be returned to Buyer and thereafter Buyer and
Seller shall have no further obligations, one to the other, with respect to the
subject matter of this Contract, subject to the provisions of Article IX
hereof.
ARTICLE VIII
CLOSING
8.1 Date and Place of Closing. The Closing shall take place in
the offices of the Title Company. The Closing Date shall be on the thirtieth
(30) day following the expiration of the Inspection Period unless another date
is mutually agreed upon in writing by Seller and Buyer.
8.2 Items to be Delivered at or Prior to the Closing.
(a) Seller. At the Closing, Seller shall deliver or cause to be
delivered to Buyer or the Title Company, the following items fully executed and
acknowledged where so indicated by all necessary parties in respect to the
Project:
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(i) A current commitment by the Title Company to promptly
deliver to Buyer an Owner's Title Policy, in the form
specified in Section 4.5 (unless waived by Buyer in accordance
with the provisions of Section 4.5);
(ii) A special warranty deed, duly executed and
acknowledged by Seller, in the form of Exhibit "C", subject
only to the Permitted Exceptions;
(iii) The original Leases, or, if any original Leases are
not available, copies of any such Leases certified by Seller
as being true, correct and complete;
(iv) Duplicate originals of an assignment and assumption
of leases (the "Assignment of Leases") in the form attached
hereto as Exhibit "D", duly executed by Seller;
(v) A ▇▇▇▇ of sale and assignment in the form, attached
hereto as Exhibit "E", duly executed by Seller;
(vi) Duplicate originals of an assignment and assumption
of Service Contracts (the "Assignment of Service Contracts")
in the form or substantially the form, attached hereto as
Exhibit "F", duly executed by Seller;
(vii) An affidavit, in the form, or substantially in the
form, attached as Exhibit "G", in compliance with Section 1445
of the Internal Revenue Code of 1986, as amended, and any
regulations promulgated thereunder, stating under penalty of
perjury the Seller's United States identification number and
that Seller is not a "foreign person" as that term is defined
in Section 1445, duly executed and acknowledged by Seller;
(viii) A notice of sale in the form, or substantially in the
form, attached hereto as Exhibit "H", (the "Tenant Notice
Letter") for each of the Tenants, duly executed by Seller and
Buyer;
(ix) The Lender's Consent and Estoppel in the form, or
substantially in the form, prescribed in Section 5.3;
(x) Tenant estoppel certificates or letters as prescribed
in Section 7.1(g), which estoppel certificates or letters
shall be signed and dated by each Tenant not more than 30 days
prior to the Closing Date and shall be in forms reasonably
comparable to the form attached hereto as Exhibit "I";
provided, however, that for Anchor Tenants the forms may
instead be reasonably comparable to that attached hereto as
Exhibit "J";
(xi) All keys or other access devices in the possession of
Seller or its agents to all locks located at the Project;
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(xii) Originals of all Service Contracts (if any), copies
of loan documents pertaining to the Existing Note and the
Existing Lien; plans, governmental approvals, and other
contracts and agreements in Seller's possession relating to
the ownership and operation of the Project;
(xiii) Originals, to the extent available, and, if not
available, true and correct copies of all books and records
pertaining to the operation of the Project for the calendar
years 1995 and 1996, and for the year-to-date 1997, in the
possession of Seller or Seller's agent;
(xiv) Appropriate evidence of authorization and opinion of
Seller's counsel reasonably satisfactory to the Title Company
(if required by the Title Company) regarding the consummation
of the transaction contemplated by this Contract;
(xv) Unless waived by Buyer, notices of cancellation, to
be effective within thirty days of the Closing Date, of all
Service Contracts affecting the Project;
(xvi) A reaffirmation certificate executed by Seller
wherein Seller reaffirms and confirms that the
representations and warranties of Seller set forth in this
Contract are true and such representations and warranties of
Seller remain true and correct in all material respects as of
the Closing Date;
(xvii) Letters to all utility companies advising of the
change of ownership of the Project and an assignment of any
deposits currently held by the utility company for the benefit
of the Seller; and
(xviii) Any other items reasonably requested by the Title
Company as administrative requirements for consummating the
Closing.
(b) Buyer. At the Closing, Buyer shall deliver or cause to be
delivered to Seller or the Title Company, the following items:
(i) The cash sum required by Section 3.1;
(ii) Duplicate originals of the Assignment of Leases duly
executed by Buyer;
(iii) Duplicate originals of the Assignment of Service
Contracts duly executed by Buyer;
(iv) Appropriate evidence of authorization reasonably
satisfactory to Seller and the Title Company for the
consummation of the transaction contemplated by this Contract;
and
(v) Any other items reasonably requested by the Title
Company as administrative requirements for consummating the
Closing.
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8.3 Adjustments at Closing. Notwithstanding anything to the
contrary contained in this Contract or applicable law, the provisions of this
Section 8.3 shall survive the Closing. All income and obligations attributable
to days preceding the Closing Date shall be allocated to Seller, and all income
and obligations attributable to days from and after the Closing Date shall be
allocated to Buyer. Without limitation upon the foregoing, the following items
shall be adjusted or prorated between Seller and Buyer as set forth below:
(a) Ad valorem and personal property taxes relating to the Project
for the calendar year in which the Closing occurs shall be prorated between
Seller and Buyer as of the Closing Date based upon taxes actually paid by
Seller for the calendar year in which the Closing occurs, if Seller has paid
such taxes prior to Closing, and otherwise upon the ad valorem and personal
property taxes due assuming payment on December 31st of the year of Closing.
If the actual amount of taxes for the calendar year in which the Closing shall
occur is not known as of the Closing Date, the proration shall be based on the
amount of taxes due and payable with respect to the Project using the latest
assessed value and tax rate. All other assessments affecting the Project, if
any, assessed prior to Closing Date, shall be paid by the Seller and if
assessed after the Closing Date, shall be paid by the Buyer.
(b) Base rents, escalation or reimbursement payments for real
estate and personal property taxes, insurance premiums, CAM or other operating
expenses and charges, payable with respect to the Project for the then current
month shall be prorated as of the Closing Date. Percentage rents for each
Tenant obligated therefor shall be pro-rated on the basis of the number of days
lapsed during the Tenant's percentage rent period as of the Closing Date and
not on the basis of the amount of the Tenant's sales which accrued during such
percentage rent period as of the Closing Date. Such proration may not be
capable of determination at the Closing Date, in which event, such prorations
shall be made post-Closing. Any rent concessions granted by the Seller to
Tenants for free rent, concessions or abatements, which apply to periods after
the Closing Date shall not be prorated but shall be credited to the Buyer.
With respect to any Tenant ("Delinquent Tenant") who owes rents and other
charges which at Closing are past due, such past due rents and other charges
("Delinquencies") shall not be prorated. Buyer shall use good faith efforts to
collect Delinquencies and shall remit such Delinquencies, if any, if, as and
when collected by Buyer; provided, however, that if a payment is received by
Buyer from a Delinquent Tenant, such payment may be applied by Buyer first to
any rents or other sums that are past due by such Delinquent Tenant from and
after the Closing Date. The right to receive and collect all rents and
profits, delinquent or otherwise, shall be assigned by Seller to Buyer at
Closing.
(c) All other income and ordinary operating expenses of the
Project, including, without limitation, public utility charges, maintenance,
management, and other service charges, and all other normal operating charges
shall be prorated at the Closing effective as of the Closing Date based upon
the best available information. The obligation of the parties to adjust,
post-Closing, and any operating expenses as of the Closing Date, shall, to the
extent unknown or not provided for at Closing, survive the Closing and shall be
paid by the party responsible therefor within ten (10) days after written
demand therefor has been made. Such demand shall include a copy of the
invoice(s) for which payment or reimbursement is sought.
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(d) All obligations for tenant finish-out and other leasing
concessions, relating to Leases entered into between the Contract Date and the
Closing Date, shall be assumed by Buyer.
8.4 Deferred Leasing Commissions. The amount of any unpaid
leasing commissions payable on account and over the then current term of
existing Leases as of the Contract Date shall either be paid by the Seller or
treated as a credit to Buyer. Commissions payable on account of Leases which
are subject to renewal at the option of the Tenant and with respect to which
the options have not been exercised prior to the Closing Date shall not be
covered by the preceding sentence, nor shall leasing commissions for Leases
entered into between the Contract Date and the Closing Date; and the obligation
for all such commissions shall be assumed at Closing by Buyer.
8.5 Possession. Possession of the Project shall be delivered to
Buyer by Seller at the Closing, subject to the rights of the Tenants.
8.6 Costs of Closing. Each party shall be responsible for paying
the legal fees of its counsel in negotiating, preparing, and closing the
transaction contemplated by this Contract. Seller shall pay for the cost of
the Survey, the Title Policy basic premium and any real estate tax searches.
Buyer shall pay the additional Title Policy premium if it wishes the "survey
exception" to be modified. Buyer shall also pay for the cost of its own
engineering and environmental inspections and charges attributable to recording
the warranty deed. The parties shall be responsible for the payment of any
transfer fees and costs charged by the Lender, as provided in Section 5.3(c).
The parties shall split the cost of any title company escrow fees. Any other
expenses that are incurred by either party that are expressly identified herein
as being the responsibility of a particular party shall be paid by such party.
All other expenses shall be allocated between the parties in the customary
manner for sales of commercial real properties similar to the Project which are
located in Dallas County, Texas.
8.7 Provisions of Article VIII to Survive Closing. The provisions
of this Article VIII shall survive the Closing.
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ARTICLE IX
DEFAULTS AND REMEDIES
9.1 Default of Buyer. If Buyer fails or refuses to consummate the
transaction contemplated by this Contract, for any reason other than
termination of this Contract by Buyer pursuant to a right to do so expressly
set forth in this Contract, then such event shall constitute a default by Buyer
hereunder and the Seller may, as the Seller's sole and exclusive remedy for
such default, either (i) bring an action against the Buyer for specific
performance of the Buyer's obligations under this Contract, or (ii) terminate
this Contract by giving written notice thereof to Buyer and the Title Company
at or prior to the Closing Date, whereupon the Title Company shall deliver the
▇▇▇▇▇▇▇ Money Deposit (including the interest earned thereon) to the Seller
which shall constitute liquidated damages hereunder and thereafter neither
party hereto shall have any further rights or obligations hereunder. It is
agreed that the ▇▇▇▇▇▇▇ Money Deposit is a reasonable forecast of just
compensation for the harm that would be caused by such default, which the
parties agree is one that is incapable or very difficult of accurate
estimation, and that payment of the ▇▇▇▇▇▇▇ Money Deposit upon such default
shall constitute full satisfaction of Buyer's obligations hereunder.
9.2 Default of Seller. If Seller fails or refuses to consummate
the sale of the Project to Buyer pursuant to this Contract at the Closing or
fails to perform any of Seller's other obligations hereunder for any reason
other than Buyer's failure to perform Buyer's obligations under this Contract,
then Buyer may, as Buyer's sole and exclusive remedy for such default, either
(i) bring an action against the Seller for specific performance of the Seller's
obligations under this Contract, (ii) terminate this Contract by giving
written notice thereof to Seller and the Title Company at or prior to the
Closing Date, whereupon the Title Company shall deliver the ▇▇▇▇▇▇▇ Money
Deposit (including the interest earned thereon) to Buyer and thereafter neither
party hereto shall have any further rights or obligations hereunder, or (iii)
receive the return of the ▇▇▇▇▇▇▇ Money Deposit and prosecute an action for
damages if (but only if) Seller has conveyed or hypothecated the Project to a
third party in violation of the terms hereof.
9.3 ▇▇▇▇▇▇▇ Money. In the event either Seller or Buyer becomes
entitled to the ▇▇▇▇▇▇▇ Money Deposit upon cancellation of this Contract in
accordance with its terms, such party may deliver a letter of instruction to
the Title Company directing disbursement of the ▇▇▇▇▇▇▇ Money Deposit to the
party entitled thereto. The party delivering such notice to the Title Company
shall concurrently deliver a copy of the notice to the other party hereto.
Upon the expiration of three (3) business days after its receipt of the letter
of instructions, the Title Company may deliver the ▇▇▇▇▇▇▇ Money Deposit to the
party as specified in the letter of instructions unless, within such three (3)
business day period, the Title Company shall have received a written objection
to such delivery from the other party hereto. In such event, the Title Company
shall not deliver the ▇▇▇▇▇▇▇ Money Deposit to either party unless it has a
written authorization to do so signed by both parties or a court order has been
issued by a court of competent jurisdiction to deliver the ▇▇▇▇▇▇▇ Money
Deposit to one of the parties hereto. The Title Company may deposit the
▇▇▇▇▇▇▇ Money Deposit into a court of competent jurisdiction and thereafter
shall have no further interest in or responsibility for this Contract or for
the ▇▇▇▇▇▇▇ Money Deposit.
9.4 Indemnification of Title Company. Each party hereto hereby
indemnifies and holds harmless the Title Company from any loss, damage or claim
therefor arising out of or in connection with the receipt and disposition of
the ▇▇▇▇▇▇▇ Money Deposit in accordance with the instructions
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set forth in this Contract. These indemnities shall survive the termination of
this Contract or a closing pursuant hereto.
ARTICLE X
BROKERAGE COMMISSIONS
10.1 Amount. If (but only if) this sale is consummated, Seller
hereby agrees to pay to Aegis Realty Group, Inc., San Antonio, Texas, ▇▇▇▇▇ &
▇▇▇▇▇, Dallas, Texas, and United Commercial Development, Inc., Dallas, Texas
(hereinafter referred to collectively as the "Brokers"), for the Brokers'
services in connection with this transaction, a commission pursuant to a
separate agreement between Seller and the Brokers.
10.2 Indemnity. Seller hereby represents and warrants to Buyer
that it has not contacted or entered into any agreement with any real estate
broker, agent, finder, or any other party in connection with this transaction,
and that Seller has not taken any action which would result in any real estate
broker's, finder's, or other fees or commissions being due or payable to any
other party with respect to the transaction contemplated hereby. Buyer hereby
represents and warrants to Seller that Buyer has not contracted or entered into
any agreement with any real estate broker, agent, finder, or other party in
connection with this transaction, other than the Brokers identified in Section
10.1, and that Buyer has not taken any action which would result in any real
estate broker's, finder's, or other fees or commissions being due or payable to
any other party with respect to the transaction contemplated hereby, except
such Brokers. Each party hereby indemnifies and agrees to hold the other party
harmless from any loss, liability, damage, cost, or expense (including, but not
limited to, reasonable attorneys' fees) resulting to the other party by reason
of a breach of the representation and warranty made by such party in this
Section 10.2. The indemnities set forth in this Section 10.2 shall survive the
Closing.
ARTICLE XI
CASUALTY OR CONDEMNATION
(a) Seller agrees to give Buyer and Title Company prompt notice of
any fire or other casualty affecting the Project or of any actual or threatened
taking or condemnation of all or any portion of the Project. If, prior to the
Closing, there shall occur:
(i) damage to the Project caused by fire or other
casualty; or
(ii) a threatened or actual taking or condemnation of all
or any portion of the Project,
then, Buyer shall have the right to terminate this Contract by written notice
delivered to Seller within ten (10) days after Buyer has received notice from
Seller of that event or the date on which Buyer learns of that event, whichever
shall last occur. If Buyer terminates this Contract, the ▇▇▇▇▇▇▇ Money
Deposit shall be returned to Buyer and the parties shall have no further
obligations under this Contract, or to each other with respect to the subject
matter of this Contract. Notwithstanding the foregoing, in the event that the
cost of repairing or restoring such damage shall be covered by
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available insurance and such cost shall be less than $100,000, then Buyer shall
proceed to Closing and Seller shall assign at Closing to Buyer its right, title
and interest in the insurance proceeds available to repair or restore the
damage or destruction and to any applicable rent loss insurance and, in
addition, Seller shall credit the Purchase Price with the amount of any
deductible under such insurance policy(s).
(b) In the event of damage or destruction to the Project in excess
of $100,000.00, Buyer may postpone the Closing Date for up to ten (10) days
pending a determination of the nature and extent of such damage or destruction
and the availability and adequacy of insurance proceeds. Such postponement
shall be by written notice from Buyer to Seller and Title Company and shall
remain in effect for up to ten (10) days (or a lesser period if ten days are
not needed for Buyer's determination of the nature and extent of the damage or
destruction and the availability and adequacy of insurance proceeds for repair
or restoration).
(c) If the cost to repair or replace the damage is reasonably
estimated by the Seller's insurance adjuster to exceed $100,000, then at
Buyer's election and in its sole discretion, Buyer may elect to proceed with
the Closing and at the Closing, Seller shall assign to Buyer its right, title
and interest in the insurance proceeds available to repair or restore the
damage or destruction and to any applicable rent loss proceeds, and Seller
shall credit the Purchase Price with the amount of any deductible under such
insurance policy(s).
(d) In the event that Buyer fails to notify Seller and Title
Company of its intention to proceed to Closing and accept as assignment of the
insurance proceeds within ten (10) days after the date of a damage or
destruction in excess of $100,000.00, then this Contract shall automatically
terminate and the ▇▇▇▇▇▇▇ Money Deposit shall be returned to Buyer forthwith.
ARTICLE XII
MISCELLANEOUS
12.1 Notices. All notices, demands, requests, and other
communications required or permitted hereunder shall be in writing, and shall
be deemed to be delivered on receipt if delivered by hand, overnight delivery,
or by facsimile, or whether actually received or not, three (3) days after
having been deposited in a regularly maintained receptacle for the United
States mail, registered or certified, return receipt requested, postage
prepaid, addressed as follows:
If to Seller: United Commercial Development, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
With a Copy to: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇, Esq.
Jenkens & ▇▇▇▇▇▇▇▇▇, P.C.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
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If to Buyer: United Investors Realty Trust
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Chief Operating Officer
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
With a Copy to: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
United Investors Realty Trust
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, P.C.
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
8th Floor Texas Commerce Bank Bldg.
▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
12.2 Governing Law. This Contract is being executed and delivered,
and is intended to be performed, in the State of Texas, and the laws of Texas
shall govern the validity, construction, enforcement, and interpretation of
this Contract. This Contract is performable in, and the exclusive venue for
any action brought with respect hereto, shall lie in Dallas County, Texas.
12.3 Entirety and Amendments. This Contract embodies the entire
agreement between the parties and supersedes all prior agreements and
understandings, if any, relating to the project, and may be amended or
supplemented only by an instrument in writing executed by the party against
whom enforcement is sought.
12.4 Parties Bound. This Contract shall be binding upon and inure
to the benefit of Seller and Buyer, and their respective heirs, personal
representatives, successors and permitted assigns, but shall not inure to the
benefit of another party.
12.5 Saturday, Sunday or Legal Holiday. If any date set forth in
this Contract for the performance of any obligation by Buyer or Seller or for
the delivery of any instrument or notice should be on other than a Business
Day, the compliance with such obligations or delivery shall be deemed
acceptable on the next following Business Day.
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12.6 Time is of the Essence. It is expressly agreed by Seller and
Buyer that time is of the essence with respect to this Contract.
12.7 Exhibits. The Exhibits which are referenced in, and attached
to, this Contract are incorporated in, and made a part of, this Contract for
all purposes.
12.8 Attorney's Fees. If either party hereto shall be required to
employ an attorney to enforce or defend the rights of such party hereunder, the
prevailing party shall be entitled to recover its reasonable attorney's fees
and costs.
12.9 Expiration of Offer. The execution by one party hereto and
delivery to the other party hereto of an executed counterpart of this Contract
shall constitute an offer to sell or purchase the Project, as may be the case,
upon the terms stated herein. If a counterpart of this Contract executed by
one party hereto without modification is not received by the other party hereto
within three (3) business days after the time and date of the execution by the
first, as indicated below, the offer contained in this Contract shall be null
and void.
12.10 Multiple Counterparts. This Contract may be executed in any
number of counterparts, all of which taken together shall constitute one and
the same agreement, and either of the parties hereto may execute this Contract
by signing any such counterpart.
12.11 Severability. If any provision of this Contract shall, for
any reason, is held to violate any applicable law, and so much of this Contract
is held to be unenforceable, then the invalidity of such specific provision
shall not be held to invalidate any other provision of this Contract which
shall remain in full force and effect.
12.12 Assignment. This Contract may be assigned by Buyer to (but
only to) any affiliated entity without the prior written consent of Seller.
12.13 DTPA Waiver. To the extent applicable and permitted by law
(and without admitting such applicability), Buyer hereby waives the provisions
of the Texas Deceptive Trade Practices-Consumer Protection Act, Chapter 17,
Subchapter E, Sections 17.41 through 17.63, inclusive (other than Section
17.555, which is not waived). Buyer represents and warrants to Seller that
Buyer is acquiring the Project for commercial or business use and has been and
will continue to be represented by legal counsel in connection with the
transactions contemplated herein.
12.14 Buyer is hereby advised that one of the parties comprising
Seller and/or an affiliate of such party is contemplating the purchase from
Cosmopolitan Lady of promissory notes which it receives from its members.
These promissory notes will likely originate in various locations of
Cosmopolitan Lady in the Dallas/Fort Worth Metroplex, which may or may not
include the Cosmopolitan Lady operation at the Project.
[ALL SIGNATURES ON THE NEXT PAGE]
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EXECUTED by Buyer on the 4th day of December, 1997.
BUYER:
UNITED INVESTORS REALTY TRUST,
a Texas real estate investment trust
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------------
Title: VP
-------------------------------------
EXECUTED by Seller on the 5th day of December, 1997.
SELLER:
ROSEMEADE PARK LIMITED PARTNERSHIP,
a Texas limited partnership
By: Beltline Country Club/Rosemeade
Corp., a Texas corporation,
its General Partner
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Vice President
Receipt of a fully executed copy of the Contract and a check, subject to
collection for the ▇▇▇▇▇▇▇ Money Deposit received this 5th day of
December, 1997.
TITLE COMPANY:
REPUBLIC TITLE OF TEXAS, INC.
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------------
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Escrow Officer
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List of Attachments
Exhibit "A" - Description of Land
Exhibit "B" - [Intentionally Deleted]
Exhibit "C" - Form of Special Warranty Deed
Exhibit "D" - Form of Assignment of Leases
Exhibit "E" - Form of ▇▇▇▇ of Sale and Assignment
Exhibit "F" - Form of Assignment of Service Contracts
Exhibit "G" - Non-Foreign Affidavit
Exhibit "H" - Form of Tenant Notice Letter
Exhibit "I" - First-Choice Form of Tenant Estoppel Letter
Exhibit "J" - Second-Choice Form of Tenant Estoppel Letter
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EXHIBIT "A"
DESCRIPTION OF LAND
TRACT 1:
▇▇▇ ▇, ▇▇▇▇▇ A
Being a tract of land out the ▇. ▇. ▇▇▇▇▇▇▇▇ Survey, Abstract No. 1120, and in
the City of Carrollton, ▇▇▇▇▇▇ County, Texas and being all of ▇▇▇ ▇, ▇▇▇▇▇ ▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇ as recorded in Cabinet E, Plage 162 of the Plat Records of
▇▇▇▇▇▇ County, Texas and being more particularly described by metes and bounds
as follows:
COMMENCING at an "x" cut in concrete set at northwest intersection of the right
of way lines of Rosemeade Parkway (100' R.O.W.) and ▇▇▇▇▇ ▇▇▇▇ (100' R.O.W.),
same being the southeast corner of ▇▇▇ ▇, ▇▇▇▇▇ ▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇;
THENCE North 89 degrees 55 minutes 00 seconds West with the north line of
Rosemeade Parkway and the south line of Lots 2 and 3, a distance of 600.48
feet, passing at 222.00 feet a found 1/2" iron rod at the southeast corner of
▇▇▇ ▇, ▇▇▇▇▇ A to a found "x" cut in concrete at the southeast corner of said
▇▇▇ ▇, ▇▇▇▇▇ ▇, same being the PLACE OF BEGINNING of the tract herein
described;
THENCE North 89 degrees 55 minutes 00 seconds West with the north line of
Rosemeade Parkway and the south line of Lot 1, a distance of 217.09 feet a
found 1/2" iron rod at the southwest corner of said ▇▇▇ ▇, ▇▇▇▇▇ ▇;
THENCE North 00 degrees 05 minutes 00 seconds East with the west boundary line
of said ▇▇▇ ▇, ▇▇▇▇▇ A for a distance of 274.47 feet to a 1/2" iron rod,
witnessed by a found "X" cut in concrete at a 9.5 feet offset in a westerly
direction, found for corner at the point of curvature of a curve to the right
having a central angle of 64 degrees 06 minutes 53 seconds, a radius of 50.00
feet and a tangent of 31.31 feet;
THENCE continuing along said west line of said Lot 1 and along said curve to
the right a distance of 55.95 feet to a 1/2" iron rod witnessed by a found "X"
cut in concrete at a 9.6 feet offset in a northwesterly direction, found at the
point of reverse curve of a curve to the left having a central angle of 23
degrees 44 minutes 11 seconds, a radius of 965.00 feet and a tangent of 202.80
feet;
THENCE continuing along said west line of said Lot 1 and along said curve to
the left a distance of 399.78 feet a 1/2" iron rod found at the northeast
corner of Lot 1, same being the northwest corner of ▇▇▇ ▇, ▇▇▇▇▇ ▇, ▇▇▇▇▇▇▇▇▇
▇▇▇▇ Addition;
THENCE South 00 degrees 05 minutes 00 seconds West with the common line of said
Lots 1 and 2 a distance of 179.48 feet to a found "X" cut in pavement for an
angle point in said line;
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THENCE South 89 degrees 55 minutes 00 seconds East with the common line of said
Lots 1 and 2 a distance of 18.00 feet to a found "x" cut in pavement, which
point lies 0.95 feet westerly from the west wall of an existing Kroger Store,
for an angle point in said line;
THENCE South 00 degrees 05 minutes 00 seconds West with the common line of said
Lots 1 and 2 a distance of 113.00 feet to a found "X" cut in pavement for an
angle point in said line;
THENCE North 89 degrees 55 minutes 00 seconds West with the common line of said
Lots 1 and 2 a distance of 142.91 feet to a found "X" cut in pavement for an
angle point in said line;
THENCE South 00 degrees 05 minutes 00 seconds West with the common line of said
Lots 1 and 2 a distance of 270.00 feet to the Point of Beginning and containing
2.522 acres of land more or less.
TRACT 2:
▇▇▇ ▇, ▇▇▇▇▇ A
Being a tract of land out the ▇. ▇. ▇▇▇▇▇▇▇▇ Survey, Abstract No. 1120, and in
the City of Carrollton, ▇▇▇▇▇▇ County, Texas and being all of ▇▇▇ ▇▇, ▇▇▇▇▇ ▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇ as recorded in Cabinet I, Page 275 of the Plat Records of ▇▇▇▇▇▇
County, Texas and being more particularly described by metes and bounds as
follows:
COMMENCING at an "x" cut in concrete set at northwest intersection of the right
of way lines of Rosemeade Parkway (100' R.O.W.) and ▇▇▇▇▇ ▇▇▇▇ (100' R.O.W.),
same being the southeast corner of ▇▇▇ ▇▇, ▇▇▇▇▇ ▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ as recorded
in Cabinet I, Slide 275 of the Plat Records of ▇▇▇▇▇▇ County, Texas;
THENCE North 89 degrees 55 minutes 00 seconds West with the north line of
Rosemeade Parkway and the south line of said Lot 3b, a distance of 222.00 feet
to a found 1/2" iron rod at the southwest corner of said Lot 3b, same being
the southeast corner of ▇▇▇ ▇, ▇▇▇▇▇ ▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ Addition as recorded in
Cabinet E, Page 162 of the Plat Records of ▇▇▇▇▇▇ County, Texas;
THENCE North 00 degrees 05 minutes 00 seconds East with the common line between
said Lots 2 and 3b for a distance of 160.00 feet to a found 1/2" iron rod at
the northwest corner of said Lot 3b, same being the southwest corner of ▇▇▇ ▇▇,
▇▇▇▇▇ A and being the PLACE OF BEGINNING of the herein described tract;
THENCE North 00 degrees 05 minutes 00 seconds East with the common line between
said Lots 2 and 3a for a distance of 122.00 feet to a found "X" cut in concrete
for an angle point in the common line between said Lots 2 and 3a; THENCE South
89 degrees 55 minutes 00 seconds East with the common line between said Lots 2
and 3a for a distance of 28.43 feet to a found "X" cut in concrete for an angle
point in said line;
THENCE North 00 degrees 05' 00' East with the common line between said Lots 2
and 3a for a distance of 269.27 feet to a found 1/2" iron rod at the northwest
corner of said Lot 3a, same being the northeast
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corner of said Lot 2 and being the point of curvature of a non-tangent curve to
the left having a central angle of 01 degrees 37' 25", a radius which bears
North 01 degrees 54' 41" East a distance of 975.00 feet and a tangent of 13.82
feet;
THENCE along the north line of said Lot 3a and along said curve to the left a
distance of 27.63 to a 1/2" iron rod found at the point of tangency of said
curve to the left; THENCE South 89 degrees 42' 44" East a distance of 167.91
feet with the north line of Lot 3 to a 1/2" iron rod found at the northeast
corner of said Lot 3b and being in the west right of way line of ▇▇▇▇▇ ▇▇▇▇;
THENCE South 00 degrees 17' 16" West with the east line of said Lot 3a and the
west right-of-way line of ▇▇▇▇▇ ▇▇▇▇ (a 100' ROW) a distance of 390.18 feet to a
found 1/2" iron rod at the southeast corner of said Lot 3a, same being the
northeast corner of said Lot 3b;
THENCE North 89 degrees 55' 00" West with the common line of said Lots 3a and 3b
a distance of 222.57 feet to the Point of Beginning and containing 1.826 acres
of land more or less.
TRACT 3:
▇▇▇ ▇▇, ▇▇▇▇▇ A
Being a tract of land out the ▇. ▇. ▇▇▇▇▇▇▇▇ Survey, Abstract No. 1120, and in
the City of Carrollton, ▇▇▇▇▇▇ County, Texas and being all of ▇▇▇ ▇▇, ▇▇▇▇▇ ▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇ as recorded in Cabinet I, Page 275 of the Plat Records of ▇▇▇▇▇▇
County, Texas and being more particularly described by metes and bounds as
follows:
BEGINNING at an "x" cut in concrete set at northwest intersection of the right
of way lines of Rosemeade Parkway (100' R.O.W.) and ▇▇▇▇▇ ▇▇▇▇ (100' R.O.W.),
same being the southeast corner of ▇▇▇ ▇▇, ▇▇▇▇▇ ▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇;
THENCE North 89 degrees 55' 00" West with the north line of Rosemeade Parkway
and the south line of said Lot 3b, a distance of 222.00 feet to a found 1/2"
iron rod at the southwest corner of said Lot 3b, same being the southeast corner
of ▇▇▇ ▇, ▇▇▇▇▇ ▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ Addition as recorded in Cabinet E, Page 162 of
the Plat Records of ▇▇▇▇▇▇ County, Texas;
THENCE North 00 degrees 05' 00" East with the common line between said Lots 2
and 3b for a distance of 160.00 feet to a found 1/2" iron rod at the northwest
corner of said Lot 3b, same being the southwest corner of ▇▇▇ ▇▇, ▇▇▇▇▇ A as
recorded in Cabinet I, Page 275 of the Plat Records of ▇▇▇▇▇▇ County, Texas;
THENCE South 89 degrees 55' 00" East with the common line between said Lost 3b
and 3a for a distance of 222.57 feet to a found 1/2" iron rod at the northeast
corner or said Lot 3b, same being the southeast corner of said Lot 3a;
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THENCE South 00 degrees 17' 16" West with the east line of said Lot 3b and the
west right-of-way line of ▇▇▇▇▇ ▇▇▇▇ (a 100' ROW) a distance of 160.00 feet to
the Point of Beginning and containing 0.817 acres of land more or less.
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