▇▇▇-▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇
SALE AGREEMENT
BETWEEN
METROPOLITAN LIFE INSURANCE COMPANY
AS SELLER
AND
▇'▇▇▇▇▇ PROPERTIES GROUP, L.P.
AS PURCHASER
Dated as of May 5, 1997
SALE AGREEMENT
THIS SALE AGREEMENT (the "Agreement") is made as of this day
of , 1997 (the "Effective Date", being the
date of Seller's execution hereof), by and between METROPOLITAN LIFE
INSURANCE COMPANY, a New York corporation, ("Seller" ) and ▇'▇▇▇▇▇ PROPERTIES
GROUP, L.P., a Pennsylvania limited partnership ("Purchaser").
W I T N E S S E T H:
ARTICLE I
PURCHASE AND SALE
Section 1.1 Agreement of Purchase and Sale. Subject to the terms and
conditions hereinafter set forth, Seller agrees to sell and convey to
Purchaser, and Purchaser agrees to purchase from Seller, the following:
(a) that certain tract or parcel of land situated at and known as
▇▇▇-▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇, more
particularly described in Exhibit A attached hereto and made a part hereof,
together with all rights and appurtenances pertaining to such property,
including any right, title and interest of Seller in and to adjacent
streets, alleys or rights-of-way (the property described in this clause (a)
being herein referred to collectively as the "Land");
(b) the buildings, structures, fixtures and other improvements
affixed to or located on the Land (the property described in this clause
(b) being herein referred to collectively as the "Improvements");
(c) any and all of Seller's right, title and interest in and to all
tangible personal property located upon the Land or within the
Improvements, including, without limitation, any and all appliances,
furniture, carpeting, draperies and curtains, tools and supplies, and other
items of personal property owned by Seller (excluding cash and any
software), located on and used exclusively in connection with the operation
of the Land and the Improvements, which personal property includes without
limitation the personal property listed on Exhibit B attached hereto (the
property described in this clause (c) being herein referred to collectively
as the "Personal Property");
(d) any and all of Seller's right, title and interest in and to: (i)
the contracts and agreements (collectively, the "Operating Agreements")
listed and described on Exhibit C attached hereto and made a part hereof
(copies of which shall be provided to Purchaser within three (3) business
days after the Effective Date) relating to the upkeep, repair, maintenance
or operation of the Land, Improvements or Personal Property, to the extent
3
assignable, except those Operating Agreements which Purchaser notifies
Seller to terminate by notice given to Seller by not later than 5:00 p.m
(local time at the Property) on the next business day after the expiration
of the Inspection Period, which shall be terminated by Seller as of the
date of the Closing or as soon thereafter as is permitted by the Operating
Agreement in question; (ii) all assignable existing warranties and
guaranties (express or implied) issued to Seller in connection with the
Improvements or the Personal Property; (iii) all assignable existing
permits, licenses, approvals and authorizations issued by any governmental
authority in connection with the Property; and (iv) the non-exclusive right
to the name "224-228 ▇▇▇▇▇▇▇▇▇▇▇ Drive" (the property described in this
clause (d) being sometimes herein referred to collectively as the
"Intangibles").
Section 1.2 Property Defined. The Land and the Improvements are
hereinafter sometimes referred to collectively as the "Real Property." The
Land, the Improvements, the Personal Property and the Intangibles are
hereinafter sometimes referred to collectively as the "Property."
Section 1.3 Purchase Price. Seller is to sell and Purchaser is to
purchase the Property for the amount of NINE MILLION FOUR HUNDRED FIFTY
THOUSAND DOLLARS ($9,450,000.00) (the "Purchase Price").
Section 1.4 Payment of Purchase Price. The Purchase Price, as increased
or decreased by prorations and adjustments as herein provided, shall be
payable in full at the Closing in cash by wire transfer of immediately
available funds to a bank account designated by Seller in writing to
Purchaser prior to the Closing.
Section 1.5 Deposit. Simultaneously with the execution and delivery of
this Agreement, Purchaser is depositing with ▇▇▇▇ LAND TRANSFER of ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("Escrow Agent") the sum of
Three Hundred Thousand Dollars ($300,000.00) (the "Deposit") in good funds,
either by certified bank or cashier's check or by federal wire transfer.
Escrow Agent shall hold the Deposit in an interest-bearing account reasonably
acceptable to Seller and Purchaser, in accordance with the terms and
conditions of this Agreement. All interest on such sum shall be deemed
income of Purchaser, and Purchaser shall be responsible for the payment of
all costs and fees imposed on the Deposit account. The Deposit and all
accrued interest shall be distributed in accordance with the terms of this
Agreement. The failure of Purchaser to timely deliver any Deposit hereunder
shall be a material default, and shall entitle Seller, at Seller's sole
option, to terminate this Agreement immediately.
Section 1.6 Escrow Agent. Escrow Agent shall hold and dispose of the
Deposit and any accrued interest thereon in accordance with the terms of this
Agreement. Seller and Purchaser agree that the duties of Escrow Agent
hereunder are purely ministerial in nature and shall be expressly limited to
4
the safekeeping and disposition of the Deposit and any accrued interest
thereon in accordance with this Agreement. Escrow Agent shall incur no
liability in connection with the safekeeping or disposition of the Deposit
and any accrued interest thereon for any reason other than Escrow Agent's
willful misconduct or gross negligence. In the event that Escrow Agent shall
be in doubt as to its duties or obligations with regard to the Deposit and
any accrued interest thereon, or in the event that Escrow Agent receives
conflicting instructions from Purchaser and Seller with respect to the
Deposit and any accrued interest thereon, Escrow Agent shall not be required
to disburse the Deposit or any accrued interest thereon and may, at its
option, continue to hold the Deposit and any accrued interest thereon until
both Purchaser and Seller agree as to its disposition, or until a final
judgment is entered by a court of competent jurisdiction directing its
disposition, or Escrow Agent may interplead the Deposit and any accrued
interest thereon in accordance with the laws of the state in which the
Property is located.
Escrow Agent shall not be responsible for any interest on the Deposit
except as is actually earned, or for the loss of any interest resulting from
the withdrawal of the Deposit or any accrued interest thereon prior to the
date interest is posted thereon.
Escrow Agent shall execute this Agreement solely for the purpose of being
bound by the provisions of Sections 1.5 and 1.6 hereof.
ARTICLE II
TITLE AND SURVEY
Section 2.1 Title Inspection Period. During the period beginning upon
the Effective Date and ending at 5:00 p.m. (local time at the Property) on
the fifteenth (15th) day thereafter (hereinafter referred to as the "Title
Inspection Period"), Purchaser shall have the right to review (a) a current
preliminary title report on the Real Property, accompanied by copies of all
documents referred to in the report, which shall be obtained by Purchaser
promptly after the Effective Date; (b) copies of the most recent property tax
bills for the Property, which shall be provided by Seller within three (3)
business days after the Effective Date; (c) a survey of the Real Property
prepared by a licensed surveyor or engineer hired by Purchaser (the
"Survey"); and (d) copies of Seller's existing title insurance policy and
survey for the Real Property, which shall be provided by Seller within three
(3) business days after the Effective Date. Purchaser shall provide Seller
with copies of the items described in clauses (a) and (c) above promptly upon
Purchaser's receipt thereof.
Section 2.2 Title Examination. Purchaser shall notify Seller in writing
(the "Title Notice"), by not later than 5:00 p.m. (local time at the
Property) on the next business day after the expiration of the Title
Inspection Period, which exceptions to title (including survey matters), if
any, will not be accepted by Purchaser. If Purchaser fails to notify Seller
in writing of its disapproval of any exceptions to title by the time
5
specified in the preceding sentence, Purchaser shall be deemed to have
approved the condition of title to the Real Property. If Purchaser notifies
Seller in writing that Purchaser objects to any exceptions to title, Seller
shall have five (5) business days after receipt of the Title Notice to notify
Purchaser (a) that Seller will remove such objectionable exceptions from
title on or before the Closing; provided that Seller may extend the Closing
for such period as shall be required to effect such cure, but not beyond
thirty (30) days; or (b) that Seller elects not to cause such exceptions to
be removed. The procurement by Seller of a commitment for the issuance of
the Title Policy (as defined in Section 2.5 hereof) or an endorsement thereto
insuring Purchaser against any title exception which was disapproved pursuant
to this Section 2.2 shall be deemed a cure by Seller of such disapproval. If
Seller gives Purchaser notice under clause (b) above, Purchaser shall have
three (3) business days in which to notify Seller that Purchaser will
nevertheless proceed with the purchase and take title to the Property subject
to such exceptions, or that Purchaser will terminate this Agreement. If this
Agreement is terminated pursuant to the foregoing provisions of this
paragraph, then neither party shall have any further rights or obligations
hereunder (except for any indemnity obligations of either party pursuant to
the other provisions of this Agreement), the Deposit and any accrued interest
thereon shall be returned to Purchaser and each party shall bear its own
costs incurred hereunder. If Purchaser shall fail to notify Seller of its
election within said three (3) business day period, Purchaser shall be deemed
to have elected to proceed with the purchase and take title to the Property
subject to such exceptions.
Section 2.3 Pre-Closing "Gap" Defects. Purchaser may, at or prior to
the Closing, notify Seller in writing (the "Gap Notice") (a) of any
objections to title that are raised by the Title Company between the
expiration of the Title Inspection Period and the Closing and that are not
disclosed by the Title Company or otherwise known to Purchaser prior to the
expiration of the Title Inspection Period, and (b) of any defects in Seller's
ability to convey title to the Personal Property free and clear of liens and
encumbrances, as revealed by a UCC search performed by Purchaser prior to the
Closing; provided in each case that Purchaser must notify Seller of such
objection to title or of such defect within two (2) business days of being
made aware of the existence of the same. If Purchaser sends a Gap Notice to
Seller, Purchaser and Seller shall have the same rights and obligations with
respect to such notice as apply to a Title Notice under Section 2.2 hereof.
Section 2.4 Permitted Exceptions. The Property shall be conveyed
subject to the following matters, which are hereinafter referred to as the
"Permitted Exceptions":
(a) those matters which are not objected to in writing within the
time periods provided in Sections 2.2 or 2.3 hereof or which, if objected
to in writing by Purchaser, are those which Seller has elected not to
remove or cure or has been unable to remove or cure, and subject to which
Purchaser has elected or is deemed to have elected to accept the conveyance
of the Property;
(b) the lien of all ad valorem real estate taxes and assessments not
6
yet due and payable as of the date of the Closing, subject to adjustment as
herein provided;
(c) local, state and federal laws, ordinances or governmental
regulations, including but not limited to building and zoning laws,
ordinances and regulations, now or hereafter in effect relating to the
Property; and
(d) items shown on the Survey and not objected to by Purchaser or
waived or deemed waived by Purchaser in accordance with Section 2.2 hereof.
Section 2.5 Conveyance of Title. At the Closing, Seller shall convey
and transfer to Purchaser fee simple title to the Land and Improvements, by
execution and delivery of the Deed (as defined in Section 4.2(a) hereof).
Evidence of delivery of such title shall be the issuance by First American
Title Insurance Company (the "Title Company"), or another national title
company, of an owner's policy of title insurance (the "Title Policy")
covering the Real Property, in the full amount of the Purchase Price, subject
only to the Permitted Exceptions.
ARTICLE III
REVIEW OF PROPERTY
Section 3.1 Right of Inspection. During the period beginning upon the
Effective Date and ending at 5:00 p.m. (local time at the Property) on the
fifteenth (15th) day thereafter (hereinafter referred to as the "Inspection
Period"), Purchaser shall have the right to make an inspection of the
environmental condition of the Property, pursuant to the terms and conditions
of this Agreement.
Purchaser understands and agrees that any on-site environmental
inspections of the Property shall occur at reasonable times agreed upon by
Seller and Purchaser after reasonable prior written notice to Seller and
shall be conducted so as not to interfere unreasonably with the use of the
Property by Seller. Seller reserves the right to have a representative
present during any such inspections. If Purchaser desires to do any invasive
environmental tests at the Property, Purchaser shall do so only after
notifying Seller and obtaining Seller's prior written consent thereto, which
consent may be subject to any terms and conditions imposed by Seller in its
sole discretion, including without limitation the prompt restoration of the
Property to its condition prior to any such tests, at Purchaser's sole cost
and expense. At Seller's option, Purchaser will furnish to Seller copies of
any reports received by Purchaser relating to any environmental inspections
performed by Purchaser. Purchaser agrees to protect, indemnify, defend and
hold Seller harmless from and against any claim for liabilities, losses,
costs, expenses (including reasonable attorneys' fees), damages or injuries
arising out of or resulting from any such inspections by Purchaser or its
agents or consultants, and notwithstanding anything to the contrary in this
Agreement, such obligation to indemnify and hold harmless Seller shall
7
survive the Closing or any termination of this Agreement.
Section 3.2 Environmental Reports. SELLER SHALL PROVIDE PURCHASER WITH
COPIES OF THE ENVIRONMENTAL REPORTS LISTED ON EXHIBIT D ATTACHED HERETO
WITHIN THREE (3) BUSINESS DAYS AFTER THE EFFECTIVE DATE. IF SELLER ELECTS TO
SECURE ANY UPDATED OR ADDITIONAL ENVIRONMENTAL REPORTS PRIOR TO THE CLOSING,
SELLER SHALL PROVIDE PURCHASER WITH COPIES OF ALL SUCH REPORTS PROMPTLY UPON
SELLER'S RECEIPT THEREOF. PURCHASER ACKNOWLEDGES THAT ANY ENVIRONMENTAL
REPORTS DELIVERED OR TO BE DELIVERED BY SELLER OR ITS AGENTS OR CONSULTANTS
TO PURCHASER ARE MADE AVAILABLE SOLELY AS AN ACCOMMODATION TO PURCHASER AND
MAY NOT BE RELIED UPON BY PURCHASER IN CONNECTION WITH THE PURCHASE OF THE
PROPERTY. PURCHASER AGREES THAT SELLER SHALL HAVE NO LIABILITY OR OBLIGATION
WHATSOEVER FOR ANY INACCURACY IN OR OMISSION FROM ANY ENVIRONMENTAL REPORT.
PURCHASER HAS CONDUCTED, OR WILL CONDUCT PRIOR TO THE EXPIRATION OF THE
INSPECTION PERIOD, ITS OWN INVESTIGATION OF THE ENVIRONMENTAL CONDITION OF
THE PROPERTY TO THE EXTENT PURCHASER DEEMS SUCH AN INVESTIGATION TO BE
NECESSARY OR APPROPRIATE.
Section 3.3 Right of Termination. If Purchaser determines that the
Property or any aspect thereof is unsuitable for Purchaser's acquisition
solely for reasons disclosed by Purchaser's environmental inspection of the
Real Property pursuant to Section 3.1 hereof, Purchaser shall have the right
to terminate this Agreement by giving written notice thereof to Seller prior
to the expiration of the Inspection Period, and if Purchaser gives such
notice of termination by not later than 5:00 p.m. (local time at the
Property) on the next business day after expiration of the Inspection Period,
this Agreement shall terminate. If this Agreement is terminated pursuant to
the foregoing provisions of this paragraph, then neither party shall have any
further rights or obligations hereunder (except for any indemnity obligations
of either party pursuant to the other provisions of this Agreement), the
Deposit and any accrued interest thereon shall be returned to Purchaser and
each party shall bear its own costs incurred hereunder. If Purchaser fails
to give Seller a notice of termination prior to the expiration of the
Inspection Period, Purchaser shall be deemed to have approved all aspects of
the Property (except title and survey, which shall be governed by Article II
hereof) and to have elected to proceed with the purchase of the Property
pursuant to the terms hereof.
ARTICLE IV
CLOSING
Section 4.1 Time and Place. The consummation of the transaction
contemplated by this Agreement (the "Closing") shall be held at the offices
8
of Escrow Agent on June 13, 1997. At the Closing, Seller and Purchaser shall
perform the obligations set forth in, respectively, Section 4.2 and Section
4.3 hereof, the performance of which obligations shall be concurrent
conditions; provided that the Deed shall not be recorded until Seller
receives confirmation that Seller has received the full amount of the
Purchase Price, adjusted by prorations as set forth herein. The Closing
shall be consummated through an escrow administered by Escrow Agent and the
Purchase Price and all documents shall be deposited with Escrow Agent as
escrowee.
Section 4.2 Seller's Obligations at the Closing. At the Closing, Seller
shall:
(a) deliver to Purchaser a duly executed Bargain and Sale Deed (the
"Deed") in the form attached hereto as Exhibit E, conveying the Land and
Improvements, subject only to the Permitted Exceptions; the warranty of
title in the Deed will be only as to claims made by, through or under
Seller and not otherwise;
(b) deliver to Purchaser a duly executed ▇▇▇▇ of sale (the "▇▇▇▇ of
Sale") conveying the Personal Property, with warranty of title as to claims
made by, through or under Seller and not otherwise, but without warranty,
express or implied, as to use, merchantability or fitness for any purpose,
in the form attached hereto as Exhibit F;
(c) to the extent assignable, assign to Purchaser, and Purchaser
shall assume, Seller's interest in the Operating Agreements, other than
those to be terminated pursuant to Section 1.1(d), and the other
Intangibles by duly executed assignment and assumption agreement (the
"Assignment and Assumption of Intangibles") in the form attached hereto as
Exhibit G pursuant to which (i) Seller shall indemnify Purchaser and hold
Purchaser harmless from and against any and all claims pertaining thereto
arising prior to the Closing and (ii) Purchaser shall indemnify Seller and
hold Seller harmless from and against any and all claims pertaining thereto
arising from and after the Closing;
(d) in the event that any representation or warranty of Seller set
forth herein needs to be modified due to changes since the Effective Date,
deliver to Purchaser a certificate, dated as of the date of the Closing and
executed on behalf of Seller by a duly authorized officer thereof,
identifying any representation or warranty which is not, or no longer is,
true and correct and explaining the state of facts giving rise to the
change. In no event shall Seller be liable to Purchaser for, or be deemed
to be in default hereunder by reason of, any breach of representation or
warranty which results from any change that (i) occurs between the
Effective Date and the date of the Closing and (ii) is expressly permitted
under the terms of this Agreement or is beyond the reasonable control of
Seller to prevent; provided, however, that the occurrence of a change which
is not permitted hereunder or is beyond the reasonable control of Seller to
prevent shall, if adverse to Purchaser, constitute the non-fulfillment of
9
the condition set forth in Section 4.6(b) hereof; if, despite changes or
other matters described in such certificate, the Closing occurs, Seller's
representations and warranties set forth in this Agreement shall be deemed
to have been modified by all statements made in such certificate;
(e) deliver to Purchaser such evidence as the Title Company may
reasonably require as to the authority of the person or persons executing
documents on behalf of Seller;
(f) deliver to Purchaser a certificate in the form attached hereto as
Exhibit H duly executed by Seller stating that Seller is not a "foreign
person" as defined in the Federal Foreign Investment in Real Property Tax
Act of 1980;
(g) deliver to Purchaser the Operating Agreements assigned to
Purchaser, together with the property files and records located at the
Property or the property manager's office relating to the continued
operation and maintenance of the Property, but excluding Seller's
partnership or corporate records, internal memoranda, financial
projections, budgets, appraisals, accounting and tax records and similar
proprietary, confidential or privileged information except budgets and
accounting records relating solely to the operation and maintenance of the
Property. For a period of three (3) years after the Closing, Purchaser
shall allow Seller and its agents and representatives access without charge
to all files, records and documents delivered to Purchaser at the Closing,
upon reasonable advance notice and at all reasonable times, to examine and
make copies of any and all such files, records and documents, which right
shall survive the Closing;
(h) deliver such affidavits as may be customarily and reasonably
required by the Title Company, in a form reasonably acceptable to Seller,
to the effect that there are no parties in possession and that no work has
been performed or materials or services provided that have not been fully
paid for and that could give rise to the filing of a mechanics' lien;
(i) deliver to Purchaser a letter (the "Non-Applicability Letter")
from the New Jersey Department of Environmental Protection and Energy or
its successor, stating that the provisions of the Industrial Site Recovery
Act, N.J.S.A. 13:1K-6 et seq., the regulations promulgated thereunder, and
any successor legislation and regulations, are inapplicable to the
Property. Seller shall apply for the Non-Applicability Letter promptly
after the Effective Date and diligently pursue the same. In the event
Seller is unable to deliver the Non-Applicability Letter at the Closing,
Seller may extend the Closing for such period as shall be required to
secure the same, but not beyond thirty (30) days. In no event shall Seller
be liable to Purchaser for, or be deemed to be in default hereunder by
reason of, Seller's failure to secure the Non-Applicability Letter if such
failure is beyond the reasonable control of Seller to prevent; provided,
10
however, that such failure shall constitute the non-fulfillment of the
condition set forth in Section 4.6(b) hereof;
(j) deliver to Purchaser possession and occupancy of the Property,
subject to the Permitted Exceptions;
(k) execute a closing statement acceptable to Seller; and
(l) deliver such additional documents as shall be reasonably required
to consummate the transaction contemplated by this Agreement.
Section 4.3 Purchaser's Obligations at the Closing. At the Closing,
Purchaser shall:
(a) pay to Seller the full amount of the Purchase Price (which shall
be adjusted to credit Purchaser with the amount of the Deposit and any
accrued interest thereon), as increased or decreased by prorations and
adjustments as herein provided, in immediately available wire transferred
funds pursuant to Section 1.4 hereof;
(b) join Seller in execution of the Assignment and Assumption of
Intangibles;
(c) in the event that any representation or warranty of Purchaser set
forth herein needs to be modified due to changes since the Effective Date,
deliver to Seller a certificate, dated as of the date of the Closing and
executed on behalf of Purchaser by a duly authorized representative
thereof, identifying any such representation or warranty which is not, or
no longer is, true and correct and explaining the state of facts giving
rise to the change. In no event shall Purchaser be liable to Seller for,
or be deemed to be in default hereunder by reason of, any breach of
representation or warranty which results from any change that (i) occurs
between the Effective Date and the date of the Closing and (ii) is
expressly permitted under the terms of this Agreement or is beyond the
reasonable control of Purchaser to prevent; provided, however, that the
occurrence of a change which is not permitted hereunder or is beyond the
reasonable control of Purchaser to prevent shall, if adverse to Seller,
constitute the non-fulfillment of the condition set forth in Section 4.7(c)
hereof; if, despite changes or other matters described in such certificate,
the Closing occurs, Purchaser's representations and warranties set forth in
this Agreement shall be deemed to have been modified by all statements made
in such certificate;
(d) deliver to Seller such evidence as the Title Company may
reasonably require as to the authority of the person or persons executing
11
documents on behalf of Purchaser;
(e) deliver such affidavits as may be customarily and reasonably
required by the Title Company, in a form reasonably acceptable to
Purchaser;
(f) execute a closing statement acceptable to Purchaser; and
(g) deliver such additional documents as shall be reasonably required
to consummate the transaction contemplated by this Agreement.
Section 4.4 Credits and Prorations.
(a) All income and expenses of the Property shall be apportioned as
of 12:01 a.m. on the day of the Closing as if Purchaser were vested with
title to the Property during the entire day upon which the Closing occurs.
Such prorated items shall include without limitation the following:
(i) taxes and assessments (including personal property taxes on the
Personal Property) levied against the Property;
(ii) utility charges for which Seller is liable, if any, such charges
to be apportioned at the Closing on the basis of the most recent
meter reading occurring prior to the Closing (dated not more than
fifteen (15) days prior to the Closing) or, if unmetered, on the
basis of a current ▇▇▇▇ for each such utility;
(iii) all amounts payable under the Operating Agreements, pursuant to
the terms of this Agreement; and
(iv) any other operating expenses or other items pertaining to the
Property which are customarily prorated between a purchaser and a
seller in the county in which the Property is located.
(b) Notwithstanding anything contained in Section 4.4(a) hereof:
(i) At the Closing Seller shall be entitled to receive and retain all
refundable cash or other deposits posted with utility companies
serving the Property;
(ii) Any taxes paid at or prior to the Closing shall be prorated based
upon the amounts actually paid. If taxes and assessments due and
payable during the year of the Closing have not been paid before
the Closing, Seller shall be charged at the Closing an amount
12
equal to that portion of such taxes and assessments which relates
to the period before the Closing and Purchaser shall pay the
taxes and assessments prior to their becoming delinquent. Any
such apportionment made with respect to a tax year for which the
tax rate or assessed valuation, or both, have not yet been fixed
shall be based upon the tax rate and/or assessed valuation last
fixed. To the extent that the actual taxes and assessments for
the current year differ from the amount apportioned at the
Closing, the parties shall make all necessary adjustments by
appropriate payments between themselves within thirty (30) days
after such amounts are determined following the Closing, subject
to the provisions of Section 4.4(d) hereof;
(iii) As to utility charges referred to in Section 4.4(a)(ii) hereof,
Seller may on notice to Purchaser elect to pay one or more of
all of said items accrued to the date hereinabove fixed for
apportionment directly to the person or entity entitled thereto,
and to the extent Seller so elects, such item shall not be
apportioned hereunder, and Seller's obligation to pay such item
directly in such case shall survive the Closing or any
termination of this Agreement;
(c) Seller may continue to prosecute any appeal of the real property
tax assessment for prior tax periods pending as of the Effective Date, and
may take related action which Seller deems appropriate in connection
therewith. Purchaser shall cooperate with Seller in connection with such
appeal and collection of a refund of real property taxes paid. Seller owns
and holds all right, title and interest in and to such appeal and refund,
and all amounts payable in connection therewith shall be paid directly to
Seller by the applicable authorities. If such refund or any part thereof
is received by Purchaser, Purchaser shall promptly pay such amount to
Seller. Any refund received by Seller shall be distributed as follows:
first, to reimburse Seller for all costs incurred in connection with the
appeal and second, to Seller to the extent such appeal covers the period
prior to the Closing, and to Purchaser to the extent such appeal covers the
period as of the Closing and thereafter. If and to the extent any such
appeal covers the period after the Closing, Purchaser shall have the right
to participate in such appeal.
(d) Except as otherwise provided herein, any revenue or expense
amount which cannot be ascertained with certainty as of the Closing shall
be prorated on the basis of the parties' reasonable estimates of such
amount, and shall be the subject of a final proration sixty (60) days after
the Closing, or as soon thereafter as the precise amounts can be
ascertained. Purchaser shall promptly notify Seller when it becomes aware
that any such estimated amount has been ascertained. Once all revenue and
expense amounts have been ascertained, Purchaser shall prepare, and certify
13
as correct, a final proration statement which shall be subject to Seller's
approval. Upon Seller's acceptance and approval of any final proration
statement submitted by Purchaser, such statement shall be conclusively
deemed to be accurate and final.
(e) Subject to the final sentence of Section 4.4(d) hereof, the
provisions of this Section 4.4 shall survive the Closing.
Section 4.5 Transaction Taxes and Closing Costs.
(a) Seller and Purchaser shall execute such returns, questionnaires
and other documents as shall be required with regard to all applicable real
property transaction taxes imposed by applicable federal, state or local
law or ordinance.
(b) Seller shall pay the fees of any counsel representing Seller in
connection with this transaction. Seller shall also pay the following
costs and expenses:
* one-half of the escrow fee, if any, which may be charged by Escrow
Agent.
* any transfer tax, sales tax, documentary stamp tax or similar tax
which becomes payable by reason of the transfer of the Property.
* the fees for Broker.
(c) Purchaser shall pay the fees of any counsel representing
Purchaser in connection with this transaction. Purchaser shall also pay
the following costs and expenses:
* one-half of the escrow fee, if any, which may be charged by Escrow
Agent or Title Company.
* the fee for the title examination and the title report or commitment
and the premium for the Title Policy, and all endorsements thereto.
* the cost of the Survey.
* the fees for recording the Deed.
(d) The Personal Property is included in this sale without charge,
except that Purchaser shall pay to Seller the amount of any and all sales
or similar taxes payable in connection with the transfer of the Personal
Property and Purchaser shall execute and deliver any tax returns required
of it in connection therewith.
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(e) All costs and expenses incident to this transaction and the
closing thereof, and not specifically described above, shall be paid by the
party incurring same.
(f) The provisions of this Section 4.5 shall survive the Closing.
Section 4.6 Conditions Precedent to Obligation of Purchaser. The
obligation of Purchaser to consummate the transaction hereunder shall be
subject to the fulfillment on or before the date of the Closing of all of the
following conditions, any or all of which may be waived by Purchaser in its
sole discretion:
(a) Seller shall have delivered to Purchaser all of the items
required to be delivered to Purchaser pursuant to the terms of this
Agreement, including but not limited to, those provided for in Section 4.2
hereof.
(b) All of the representations and warranties of Seller contained in
this Agreement shall be true and correct as of the date of the Closing
(with appropriate modifications permitted under this Agreement).
(c) Seller shall have performed and observed, in all material
respects, all covenants and agreements of this Agreement to be performed
and observed by Seller as of the date of the Closing.
Section 4.7 Conditions Precedent to Obligation of Seller. The
obligation of Seller to consummate the transaction hereunder shall be subject
to the fulfillment on or before the date of the Closing of all of the
following conditions, any or all of which may be waived by Seller in its sole
discretion:
(a) Seller shall have received the Purchase Price as adjusted as
provided herein, pursuant to and payable in the manner provided for in this
Agreement.
(b) Purchaser shall have delivered to Seller all of the items
required to be delivered to Seller pursuant to the terms of this Agreement,
including but not limited to, those provided for in Section 4.3 hereof.
(c) All of the representations and warranties of Purchaser contained
in this Agreement shall be true and correct as of the date of the Closing
(with appropriate modifications permitted under this Agreement).
(d) Purchaser shall have performed and observed, in all material
respects, all covenants and agreements of this Agreement to be performed
and observed by Purchaser as of the date of the Closing.
15
ARTICLE V
REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 5.1 Representations and Warranties of Seller. Seller hereby
makes the following representations and warranties to Purchaser as of the
Effective Date, which representations and warranties shall be deemed to have
been made again as of the Closing, subject to Section 4.2(d) hereof:
(a) Organization and Authority. Seller has been duly organized and
is validly existing under the laws of the State of New York. Subject to
the provisions of Section 10.16 hereof, Seller has the full right and
authority to enter into this Agreement and to transfer all of the Property
and to consummate or cause to be consummated the transaction contemplated
by this Agreement. The person signing this Agreement on behalf of Seller
is authorized to do so.
(b) Leases. To Seller's knowledge, there are no leases currently
affecting the Property and the Property is unoccupied.
(c) Pending Actions. To Seller's knowledge, Seller has not received
written notice of any action, suit, arbitration, unsatisfied order or
judgment, government investigation or proceeding pending against Seller
which, if adversely determined, could individually or in the aggregate
materially interfere with the consummation of the transaction contemplated
by this Agreement.
(d) Operating Agreements. To Seller's knowledge, the Operating
Agreements listed on Exhibit C are all of the agreements concerning the
operation and maintenance of the Property entered into by Seller and
affecting the Property, except any agreement with Seller's property
manager, which shall be terminated by Seller.
(e) Lease Brokerage. To Seller's knowledge, there are no agreements
with brokers providing for the payment from and after the Closing by Seller
or Seller's successor-in-interest of leasing commissions or fees for
procuring tenants with respect to the Property.
(f) Condemnation. To Seller's knowledge, Seller has received no
written notice of any condemnation proceedings relating to the Property.
(g) Litigation. To Seller's knowledge, except as set forth on
Exhibit I attached hereto, and except proceedings related to claims for
personal injury or damage to property due to events occurring at the
Property, Seller has not received written notice of any litigation which
has been filed against Seller that arises out of the ownership of the
16
Property and would affect the Property or use thereof, or Seller's ability
to perform hereunder.
(h) Violations. To Seller's knowledge, except as set forth on
Exhibit J attached hereto, Seller has not received written notice of any
uncured violation of any federal, state or local law relating to the use or
operation of the Property which would materially adversely affect the
Property or use thereof.
(i) Insurance. Seller presently maintains, and Seller will continue
to maintain until the date of the Closing, a policy of casualty insurance
providing so-called "all-risk" coverage for the full replacement value of
the Improvements.
Section 5.2 Knowledge Defined. References to the "knowledge" of Seller
shall refer only to the current actual knowledge of the Designated Employee
(as hereinafter defined) of AEW Real Estate Advisors, Limited Partnership,
and shall not be construed, by imputation or otherwise, to refer to the
knowledge of Seller or any affiliate of Seller, to any property manager, or
to any other officer, agent, manager, representative or employee of Seller or
any affiliate thereof or to impose upon such Designated Employee any duty to
investigate the matter to which such actual knowledge, or the absence
thereof, pertains. As used herein, the term "Designated Employee" shall
refer to the following person: ▇▇▇▇▇ ▇▇▇▇▇▇.
Section 5.3 Survival of Seller's Representations and Warranties. The
representations and warranties of Seller set forth in Section 5.1 hereof as
updated as of the Closing in accordance with the terms of this Agreement,
shall survive the Closing for a period of one hundred eighty (180) days. No
claim for a breach of any representation or warranty of Seller shall be
actionable or payable if the breach in question results from or is based on a
condition, state of facts or other matter which was known to Purchaser prior
to the Closing. Seller shall have no liability to Purchaser for a breach of
any representation or warranty (a) unless the valid claims for all such
breaches collectively aggregate more than Fifty Thousand Dollars
($50,000.00), in which event the full amount of such valid claims shall be
actionable, up to the Cap (as defined in this Section), and (b) unless
written notice containing a description of the specific nature of such breach
shall have been given by Purchaser to Seller prior to the expiration of said
one hundred eighty (180) day period and an action shall have been commenced
by Purchaser against Seller within two hundred forty (240) days of the
Closing. Purchaser agrees to first seek recovery under any insurance
policies and service contracts prior to seeking recovery from Seller, and
Seller shall not be liable to Purchaser if Purchaser's claim is satisfied
from such insurance policies or service contracts. As used herein, the term
"Cap" shall mean the total aggregate amount of Four Hundred Seventy-Two
Thousand Five Hundred Dollars ($472,500.00), being five percent (5%) of the
Purchase Price.
Section 5.4 Covenants of Seller. Seller hereby covenants with Purchaser
as follows:
17
(a) From the Effective Date until the Closing or earlier termination
of this Agreement, Seller shall use reasonable efforts to operate and
maintain the Property in a manner generally consistent with the manner in
which Seller has operated and maintained the Property prior to the
Effective Date.
(b) Seller shall not enter into any lease of space at the Property
prior to the Closing.
Section 5.5 Representations and Warranties of Purchaser. Purchaser
hereby makes the following representations and warranties to Seller as of the
Effective Date, which representations and warranties shall be deemed to have
been made again as of the Closing, subject to Section 4.3(c) hereof:
(a) Organization and Authority. Purchaser has been duly organized
and is validly existing under the laws of the Commonwealth of Pennsylvania.
Purchaser has the full right and authority to enter into this Agreement and
to consummate or cause to be consummated the transaction contemplated by
this Agreement. The person signing this Agreement on behalf of Purchaser
is authorized to do so.
(b) Pending Actions. To Purchaser's knowledge, there is no action,
suit, arbitration, unsatisfied order or judgment, government investigation
or proceeding pending against Purchaser which, if adversely determined,
could individually or in the aggregate materially interfere with the
consummation of the transaction contemplated by this Agreement.
(c) ERISA. As of the Closing, (1) Purchaser will not be an employee
benefit plan as defined in Section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), which is subject to Title I of
ERISA, nor a plan as defined in Section 4975(e)(1) of the Internal Revenue
Code of 1986, as amended (each of the foregoing hereinafter referred to
collectively as "Plan"), and (2) the assets of Purchaser will not
constitute "plan assets" of one or more such Plans within the meaning of
Department of Labor ("DOL") Regulation Section 2510.3-101.
As of the Closing, if Purchaser is a "governmental plan" as
defined in Section 3(32) of ERISA, the closing of the sale of the Property
will not constitute or result in a violation of state or local statutes
regulating investments of and fiduciary obligations with respect to
governmental plans.
As of the Closing, Purchaser will be acting on its own behalf and
not on account of or for the benefit of any Plan.
Purchaser has no present intent to transfer the Property to any
18
entity, person or Plan which will cause a violation of ERISA.
Purchaser shall not assign its interest under this contract of
sale to any entity, person, or Plan which will cause a violation of ERISA.
Section 5.6 Survival of Purchaser's Representations and Warranties. The
representations and warranties of Purchaser set forth in Section 5.5 hereof
as updated as of the Closing in accordance with the terms of this Agreement,
shall survive the Closing for a period of one hundred eighty (180) days. No
claim for a breach of any representation or warranty of Purchaser shall be
actionable or payable if the breach in question results from or is based on a
condition, state of facts or other matter which was known to Seller prior to
the Closing. Purchaser shall have no liability to Seller for a breach of any
representation or warranty (a) unless the valid claims for all such breaches
collectively aggregate more than Fifty Thousand Dollars ($50,000.00), in
which event the full amount of such valid claims shall be actionable, up to
the Cap (as defined in this Section), and (b) unless written notice
containing a description of the specific nature of such breach shall have
been given by Seller to Purchaser prior to the expiration of said one hundred
eighty (180) day period and an action shall have been commenced by Seller
against Purchaser within two hundred forty (240) days of the Closing. Seller
agrees to first seek recovery under any insurance policies and service
contracts prior to seeking recovery from Purchaser, and Purchaser shall not
be liable to Seller if Seller's claim is satisfied from such insurance
policies or service contracts. As used herein, the term "Cap" shall mean the
total aggregate amount of Four Hundred Seventy-Two Thousand Five Hundred
Dollars ($472,500.00), being five percent (5%) of the Purchase Price.
ARTICLE VI
DEFAULT
Section 6.1 Default by Purchaser. In the event the sale of the Property
as contemplated by this Agreement is not consummated due to Purchaser's
default hereunder, Seller shall be entitled, as its sole remedy, to terminate
this Agreement and receive the Deposit and any accrued interest thereon as
liquidated damages for the breach of this Agreement, it being agreed between
the parties hereto that the actual damages to Seller in the event of such
breach are impractical to ascertain and the amount of the Deposit and any
accrued interest thereon is a reasonable estimate thereof.
Section 6.2 Default by Seller. In the event the sale of the Property as
contemplated by this Agreement is not consummated due to Seller's default
hereunder, Purchaser shall be entitled, as its sole remedy, either (a) to
receive the return of the Deposit and any accrued interest thereon, in which
event Seller shall reimburse Purchaser for the costs, not to exceed Fifty
Thousand Dollars ($50,000.00) of legal, title, survey, environmental
engineering and architectural services actually incurred by Purchaser in
connection with this Agreement and Purchaser's investigation of the Property,
which return and reimbursement shall operate to terminate this Agreement and
19
release Seller from any and all liability hereunder, or (b) to enforce
specific performance of Seller's obligation to convey the Property to
Purchaser in accordance with the terms of this Agreement, it being understood
and agreed that the remedy of specific performance shall not be available to
enforce any other obligation of Seller hereunder. Purchaser expressly waives
its rights to seek damages in the event of Seller's default hereunder.
Purchaser shall be deemed to have elected to terminate this Agreement and
receive back the Deposit and any accrued interest thereon if Purchaser fails
to file suit for specific performance against Seller in a court having
jurisdiction in the county and state in which the Property is located, on or
before thirty (30) days following the date upon which the Closing was to have
occurred.
Section 6.3 Recoverable Damages. Notwithstanding Sections 6.1 and 6.2
hereof, in no event shall the provisions of Sections 6.1 and 6.2 limit the
damages recoverable by either party against the other party due to the other
party's obligation to indemnify such party in accordance with this Agreement.
ARTICLE VII
RISK OF LOSS
Section 7.1 Minor Damage. In the event of loss or damage to the
Property or any portion thereof which is not "Major" (as hereinafter
defined), this Agreement shall remain in full force and effect provided that
Seller shall, at Seller's option, either (a) perform any necessary repairs,
or (b) assign to Purchaser all of Seller's right, title and interest in and
to any claims and proceeds Seller may have with respect to any casualty
insurance policies or condemnation awards relating to the premises in
question. In the event that Seller elects to perform repairs upon the
Property, Seller shall use reasonable efforts to complete such repairs
promptly and the date of the Closing shall be extended a reasonable time in
order to allow for the completion of such repairs. If Seller elects to assign
a casualty claim to Purchaser, the Purchase Price shall be reduced by an
amount equal to the lesser of the deductible amount under Seller's insurance
policy or the cost of such repairs as determined in accordance with Section
7.3 hereof. In addition to the foregoing, if Seller elects to assign a
casualty claim to Purchaser, Purchaser shall have the right to enter upon the
Property to make such repairs as may be necessary to stabilize the
Improvements against further damage and to secure the Improvements against
vandalism and the like, provided that in such event Purchaser hereby agrees
to protect, indemnify, defend and hold Seller harmless from and against any
claim for liabilities, losses, costs, expenses (including reasonable
attorneys' fees), damages or injuries arising out of or resulting from any
repairs performed by Purchaser or its agents, and notwithstanding anything to
the contrary in this Agreement, such obligation to indemnify and hold
harmless Seller shall survive the Closing or any termination of this
Agreement. Upon the Closing, full risk of loss with respect to the Property
shall pass to Purchaser.
Section 7.2 Major Damage. In the event of a "Major" loss or damage,
20
Purchaser may terminate this Agreement by written notice to Seller, in which
event the Deposit and any accrued interest thereon shall be returned to
Purchaser. If Purchaser does not elect to terminate this Agreement within ten
(10) days after Seller sends Purchaser written notice of the occurrence of such
Major loss or damage (which notice shall state the cost of repair or restoration
thereof as opined by an architect in accordance with Section 7.3 hereof), then
Purchaser shall be deemed to have elected to proceed with the Closing, in which
event Seller shall, at Seller's option, either (a) perform any necessary
repairs, or (b) assign to Purchaser all of Seller's right, title and interest in
and to any claims and proceeds Seller may have with respect to any casualty
insurance policies or condemnation awards relating to the premises in question.
In the event that Seller elects to perform repairs upon the Property, Seller
shall use reasonable efforts to complete such repairs promptly and the date of
the Closing shall be extended a reasonable time in order to allow for the
completion of such repairs. If Seller elects to assign a casualty claim to
Purchaser, the Purchase Price shall be reduced by an amount equal to the lesser
of the deductible amount under Seller's insurance policy or the cost of such
repairs as determined in accordance with Section 7.3 hereof. In addition to the
foregoing, if Seller elects to assign a casualty claim to Purchaser, Purchaser
shall have the right to enter upon the Property to make such repairs as may be
necessary to stabilize the Improvements against further damage and to secure the
Improvements against vandalism and the like, provided that in such event
Purchaser hereby agrees to protect, indemnify, defend and hold Seller harmless
from and against any claim for liabilities, losses, costs, expenses (including
reasonable attorneys' fees), damages or injuries arising out of or resulting
from any repairs performed by Purchaser or its agents, and notwithstanding
anything to the contrary in this Agreement, such obligation to indemnify and
hold harmless Seller shall survive the Closing or any termination of this
Agreement. Upon the Closing, full risk of loss with respect to the Property
shall pass to Purchaser.
Section 7.3 Definition of "Major" Loss or Damage. For purposes of
Sections 7.1 and 7.2, "Major" loss or damage refers to the following: (a)
loss or damage to the Property hereof such that the cost of repairing or
restoring the premises in question to substantially the same condition which
existed prior to the event of damage would be, in the opinion of an architect
selected by Seller and reasonably approved by Purchaser, equal to or greater
than Four Hundred Seventy-two Thousand Five Hundred Dollars ($472,500.00),
being five percent (10%) of the Purchase Price, and (b) any loss due to a
condemnation which permanently and materially impairs the current use of the
Property. If Purchaser does not give written notice to Seller of Purchaser's
reasons for disapproving an architect within five (5) business days after
receipt of notice of the proposed architect, Purchaser shall be deemed to
have approved the architect selected by Seller.
ARTICLE VIII
COMMISSIONS
Section 8.1 Brokerage Commissions. With respect to the transaction
21
contemplated by this Agreement, Seller represents that its sole broker is
▇▇▇▇▇▇▇ & Wakefield ("Broker"), and Purchaser represents that it has not
engaged any broker. Each party hereto agrees that if any person or entity
other than Broker makes a claim for brokerage commissions or finder's fees
related to the sale of the Property by Seller to Purchaser, and such claim is
made by, through or on account of any acts or alleged acts of said party or
its representatives, said party will protect, indemnify, defend and hold the
other party free and harmless from and against any and all loss, liability,
cost, damage and expense (including reasonable attorneys' fees) in connection
therewith. The provisions of this paragraph shall survive the Closing or any
termination of this Agreement.
ARTICLE IX
DISCLAIMERS AND WAIVERS
Section 9.1 No Reliance on Documents. Except as expressly stated
herein, Seller makes no representation or warranty as to the truth, accuracy
or completeness of any materials, data or information delivered by Seller or
its brokers or agents to Purchaser in connection with the transaction
contemplated by this Agreement. Purchaser acknowledges and agrees that all
materials, data and information delivered by Seller to Purchaser in
connection with the transaction contemplated by this Agreement are provided
to Purchaser as a convenience only and that any reliance on or use of such
materials, data or information by Purchaser shall be at the sole risk of
Purchaser, except as otherwise expressly stated herein. Neither Seller, nor
any affiliate of Seller, nor the person or entity which prepared any report
or reports delivered by Seller to Purchaser shall have any liability to
Purchaser for any inaccuracy in or omission from any such reports.
Section 9.2 AS-IS SALE; DISCLAIMERS. EXCEPT AS EXPRESSLY SET FORTH IN
THIS AGREEMENT, IT IS UNDERSTOOD AND AGREED THAT SELLER IS NOT MAKING AND HAS
NOT AT ANY TIME MADE ANY WARRANTIES OR REPRESENTATIONS OF ANY KIND OR
CHARACTER, EXPRESS OR IMPLIED, WITH RESPECT TO THE PROPERTY, INCLUDING, BUT
NOT LIMITED TO, ANY WARRANTIES OR REPRESENTATIONS AS TO HABITABILITY,
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
PURCHASER ACKNOWLEDGES AND AGREES THAT UPON THE CLOSING SELLER SHALL SELL
AND CONVEY TO PURCHASER AND PURCHASER SHALL ACCEPT THE PROPERTY "AS IS, WHERE
IS, WITH ALL FAULTS", EXCEPT TO THE EXTENT EXPRESSLY PROVIDED OTHERWISE IN
THIS AGREEMENT. PURCHASER HAS NOT RELIED AND WILL NOT RELY ON, AND SELLER IS
NOT LIABLE FOR OR BOUND BY, ANY EXPRESS OR IMPLIED WARRANTIES, GUARANTIES,
STATEMENTS, REPRESENTATIONS OR INFORMATION PERTAINING TO THE PROPERTY OR
22
RELATING THERETO (INCLUDING SPECIFICALLY, WITHOUT LIMITATION, OFFERING
PACKAGES DISTRIBUTED WITH RESPECT TO THE PROPERTY) MADE OR FURNISHED BY
SELLER, THE MANAGERS OF THE PROPERTY, OR ANY REAL ESTATE BROKER OR AGENT
REPRESENTING OR PURPORTING TO REPRESENT SELLER, TO WHOMEVER MADE OR GIVEN,
DIRECTLY OR INDIRECTLY, ORALLY OR IN WRITING, UNLESS SPECIFICALLY SET FORTH
IN THIS AGREEMENT. PURCHASER ALSO ACKNOWLEDGES THAT THE PURCHASE PRICE
REFLECTS AND TAKES INTO ACCOUNT THAT THE PROPERTY IS BEING SOLD "AS-IS."
PURCHASER REPRESENTS TO SELLER THAT PURCHASER HAS CONDUCTED, OR WILL
CONDUCT PRIOR TO THE CLOSING, SUCH INVESTIGATIONS OF THE PROPERTY, INCLUDING
BUT NOT LIMITED TO, THE PHYSICAL AND ENVIRONMENTAL CONDITIONS THEREOF, AS
PURCHASER DEEMS NECESSARY OR DESIRABLE TO SATISFY ITSELF AS TO THE CONDITION
OF THE PROPERTY AND THE EXISTENCE OR NONEXISTENCE OR CURATIVE ACTION TO BE
TAKEN WITH RESPECT TO ANY HAZARDOUS OR TOXIC SUBSTANCES ON OR DISCHARGED FROM
THE PROPERTY, AND WILL RELY SOLELY UPON SAME AND NOT UPON ANY INFORMATION
PROVIDED BY OR ON BEHALF OF SELLER OR ITS AGENTS OR EMPLOYEES WITH RESPECT
THERETO, OTHER THAN SUCH REPRESENTATIONS, WARRANTIES AND COVENANTS OF SELLER
AS ARE EXPRESSLY SET FORTH IN THIS AGREEMENT. UPON THE CLOSING, PURCHASER
SHALL ASSUME THE RISK THAT ADVERSE MATTERS, INCLUDING BUT NOT LIMITED TO,
CONSTRUCTION DEFECTS AND ADVERSE PHYSICAL AND ENVIRONMENTAL CONDITIONS, MAY
NOT HAVE BEEN REVEALED BY PURCHASER'S INVESTIGATIONS, AND PURCHASER, UPON THE
CLOSING, SHALL BE DEEMED TO HAVE WAIVED, RELINQUISHED AND RELEASED SELLER
(AND SELLER'S OFFICERS, DIRECTORS, SHAREHOLDERS, EMPLOYEES AND AGENTS) FROM
AND AGAINST ANY AND ALL CLAIMS, DEMANDS, CAUSES OF ACTION (INCLUDING CAUSES
OF ACTION IN TORT), LOSSES, DAMAGES, LIABILITIES, COSTS AND EXPENSES
(INCLUDING REASONABLE ATTORNEYS' FEES) OF ANY AND EVERY KIND OR CHARACTER,
KNOWN OR UNKNOWN, WHICH PURCHASER MIGHT HAVE ASSERTED OR ALLEGED AGAINST
SELLER (AND SELLER'S OFFICERS, DIRECTORS, SHAREHOLDERS, EMPLOYEES AND AGENTS)
AT ANY TIME BY REASON OF OR ARISING OUT OF ANY LATENT OR PATENT CONSTRUCTION
DEFECTS OR PHYSICAL CONDITIONS, VIOLATIONS OF ANY APPLICABLE LAWS AND ANY AND
ALL OTHER ACTS, OMISSIONS, EVENTS, CIRCUMSTANCES OR MATTERS REGARDING THE
PROPERTY.
Section 9.3 Survival of Disclaimers. The provisions of this Article IX
shall survive the Closing or any termination of this Agreement.
23
ARTICLE X
MISCELLANEOUS
Section 10.1 Confidentiality. Purchaser and its representatives shall
hold in strictest confidence all data and information obtained with respect
to Seller or its business, whether obtained before or after the execution and
delivery of this Agreement, and shall not disclose the same to others;
provided, however, that it is understood and agreed that Purchaser may
disclose such data and information to the employees, lenders, consultants,
accountants and attorneys of Purchaser provided that such persons agree in
writing to treat such data and information confidentially. In the event this
Agreement is terminated or Purchaser fails to perform hereunder, Purchaser
shall promptly return to Seller any statements, documents, schedules,
exhibits or other written information obtained from Seller in connection with
this Agreement or the transaction contemplated by this Agreement. It is
understood and agreed that, with respect to any provision of this Agreement
which refers to the termination of this Agreement and the return of the
Deposit and any accrued interest thereon to Purchaser, such Deposit and
accrued interest shall not be returned to Purchaser unless and until
Purchaser has fulfilled its obligation to return to Seller the materials
described in the preceding sentence. In the event of a breach or threatened
breach by Purchaser or its agents or representatives of this Section 10.1,
Seller shall be entitled to an injunction restraining Purchaser or its agents
or representatives from disclosing, in whole or in part, such confidential
information. Nothing herein shall be construed as prohibiting Seller from
pursuing any other available remedy at law or in equity for such breach or
threatened breach. The provisions of this Section 10.1 shall survive the
Closing or any termination of this Agreement.
Section 10.2 Public Disclosure. Prior to the Closing, any release to
the public of information with respect to the sale contemplated by this
Agreement or any matters set forth in this Agreement will be made only in the
form approved by Purchaser and Seller. The provisions of this Section 10.2
shall survive the Closing or any termination of this Agreement.
Section 10.3 Assignment. Subject to the provisions of this Section 10.3,
the terms and provisions of this Agreement are to apply to and bind the
permitted successors and assigns of the parties hereto. Purchaser may not
assign its rights under this Agreement without first obtaining Seller's written
approval, which approval may be given or withheld in Seller's sole discretion.
In the event Purchaser intends to assign its rights hereunder, (a) Purchaser
shall send Seller written notice of its request at least ten (10) business days
prior to the Closing, which request shall include the legal name and structure
of the proposed assignee, as well as any other information that Seller may
reasonably request, and (b) Purchaser and the proposed assignee shall execute an
assignment and assumption of this Agreement in form and substance satisfactory
to Seller, and (c) in no event shall any assignment of this Agreement release or
discharge Purchaser from any liability or obligation hereunder. Notwithstanding
the foregoing, Seller's prior written approval shall not be required in
connection with any assignment by Purchaser of its rights under this Agreement
24
to any entity in which J. ▇▇▇▇▇ ▇'▇▇▇▇▇ or a Trust created for members of his
immediate family is an investor, provided that (i) such assignment shall not
take effect until the date of the Closing, (ii) Purchaser shall give Seller
written notice of any such assignment at least five (5) business days prior to
the Closing, and (iii) the provisions of clauses (b) and (c) above shall apply
to any such assignment. Notwithstanding the foregoing, under no circumstances
shall Purchaser have the right to assign this Agreement to any person or entity
owned or controlled by an employee benefit plan if Seller's sale of the Property
to such person or entity would, in the reasonable opinion of Seller's ERISA
advisor, create or otherwise cause a "prohibited transaction" under ERISA. Any
transfer, directly or indirectly, of any stock, partnership interest or other
ownership interest in Purchaser shall constitute an assignment of this
Agreement. The provisions of this Section 10.3 shall survive the Closing or any
termination of this Agreement.
Section 10.4 Notices. Any notice pursuant to this Agreement shall be
given in writing by (a) personal delivery, (b) reputable overnight delivery
service with proof of delivery, (c) United States Mail, postage prepaid,
registered or certified mail, return receipt requested, or (d) legible
facsimile transmission, sent to the intended addressee at the address set
forth below, or to such other address or to the attention of such other
person as the addressee shall have designated by written notice sent in
accordance herewith, and shall be deemed to have been given upon receipt or
refusal to accept delivery, or, in the case of facsimile transmission, as of
the date of the facsimile transmission provided that an original of such
facsimile is also sent to the intended addressee by means described in
clauses (a), (b) or (c) above. Unless changed in accordance with the
preceding sentence, the addresses for notices given pursuant to this
Agreement shall be as follows:
If to Seller:
Metropolitan Life Insurance Company
▇/▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇.▇.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
25
If to Purchaser:
▇'▇▇▇▇▇ Properties Group, L.P.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Gold & ▇▇▇▇▇
▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Section 10.5 Modifications. This Agreement cannot be changed orally,
and no executory agreement shall be effective to waive, change, modify or
discharge it in whole or in part unless such executory agreement is in
writing and is signed by the parties against whom enforcement of any waiver,
change, modification or discharge is sought.
Section 10.6 Entire Agreement. This Agreement, including the exhibits
and schedules hereto, contains the entire agreement between the parties
hereto pertaining to the subject matter hereof and fully supersedes all prior
written or oral agreements and understandings between the parties pertaining
to such subject matter, other than any confidentiality agreement executed by
Purchaser in connection with the Property.
Section 10.7 Further Assurances. Each party agrees that it will execute
and deliver such other documents and take such other action, whether prior or
subsequent to the Closing, as may be reasonably requested by the other party
to consummate the transaction contemplated by this Agreement. The provisions
of this Section 10.7 shall survive the Closing.
Section 10.8 Counterparts. This Agreement may be executed in
counterparts, all such executed counterparts shall constitute the same
agreement, and the signature of any party to any counterpart shall be deemed
a signature to, and may be appended to, any other counterpart.
26
Section 10.9 Facsimile Signatures. In order to expedite the transaction
contemplated by this Agreement, telecopied signatures may be used in place of
original signatures on this Agreement. Seller and Purchaser intend to be bound
by the signatures on the telecopied document, are aware that the other party
will rely on the telecopied signatures, and hereby waive any defenses to the
enforcement of the terms of this Agreement based on the form of signature.
Section 10.10 Severability. If any provision of this Agreement is
determined by a court of competent jurisdiction to be invalid or
unenforceable, the remainder of this Agreement shall nonetheless remain in
full force and effect; provided that the invalidity or unenforceability of
such provision does not materially adversely affect the benefits accruing to
any party hereunder.
Section 10.11 Applicable Law. This Agreement shall be governed by and
construed in accordance with the laws of the State in which the Property is
located. Purchaser and Seller agree that the provisions of this Section
10.11 shall survive the Closing or any termination of this Agreement.
Section 10.12 No Third-Party Beneficiary. The provisions of this
Agreement and of the documents to be executed and delivered at the Closing
are and will be for the benefit of Seller and Purchaser only and are not for
the benefit of any third party, and accordingly, no third party shall have
the right to enforce the provisions of this Agreement or of the documents to
be executed and delivered at the Closing.
Section 10.13 Captions. The section headings appearing in this
Agreement are for convenience of reference only and are not intended, to any
extent and for any purpose, to limit or define the text of any section or any
subsection hereof.
Section 10.14 Construction. The parties acknowledge that the parties
and their counsel have reviewed and revised this Agreement and that the
normal rule of construction to the effect that any ambiguities are to be
resolved against the drafting party shall not be employed in the
interpretation of this Agreement or any exhibits or amendments hereto.
Section 10.15 Recordation. This Agreement may not be recorded by any
party hereto without the prior written consent of the other party hereto.
The provisions of this Section 10.15 shall survive the Closing or any
termination of this Agreement.
Section 10.16 Seller Approval. INTENTIONALLY OMITTED.
Section 10.17 Time of the Essence. Time is of the essence of this
Agreement, and of each covenant, agreement and condition hereof which
provides for notice to be given or action taken on a specific date or within
a specified period of time.
27
28
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as
of the Effective Date.
PURCHASER:
▇'▇▇▇▇▇ PROPERTIES GROUP, L.P.,
by , its
General Partner
By:______________________________________________
Name:_____________________________________________
Title:____________________________________________
Date:_____________________________________________
SELLER:
METROPOLITAN LIFE INSURANCE COMPANY, by AEW Real
Estate Advisors, Limited Partnership, its duly
authorized asset manager and advisor
By:______________________________________________
Name:_____________________________________________
Title:____________________________________________
Date:_____________________________________________
29
Escrow Agent executes this Agreement below solely for the purpose of
acknowledging that it agrees to be bound by the provisions of Sections 1.5
and 1.6 hereof.
ESCROW AGENT:
▇▇▇▇ LAND TRANSFER
By:______________________________________________
Name:_____________________________________________
Title:____________________________________________
Date:_____________________________________________
30
TABLE OF CONTENTS
Page No.
ARTICLE I PURCHASE AND SALE
Section 1.1 Agreement of Purchase and Sale........................... 2
Section 1.2 Property Defined......................................... 3
Section 1.3. Purchase Price........................................... 3
Section 1.4 Payment of Purchase Price................................ 3
Section 1.5 Deposit.................................................. 3
Section 1.6 Escrow Agent............................................. 3
ARTICLE II TITLE AND SURVEY
Section 2.1 Title Inspection Period.................................. 4
Section 2.2 Title Examination........................................ 4
Section 2.3 Pre-Closing "Gap" Defects................................ 5
Section 2.4 Permitted Exceptions..................................... 5
Section 2.5 Conveyance of Title...................................... 6
ARTICLE III REVIEW OF PROPERTY
Section 3.1 Right of Inspection...................................... 6
Section 3.2 Environmental Reports.................................... 6
Section 3.3 Right of Termination..................................... 7
ARTICLE IV CLOSING
Section 4.1 Time and Place........................................... 7
Section 4.2 Seller's Obligations at the Closing...................... 8
Section 4.3 Purchaser's Obligations at the Closing................... 10
Section 4.4 Credits and Prorations....................................11
Section 4.5 Transaction Taxes and Closing Costs...................... 12
Section 4.6 Conditions Precedent to Obligation of Purchaser.......... 13
Section 4.7 Conditions Precedent to Obligation of Seller............. 14
ARTICLE V REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 5.1 Representations and Warranties of Seller..................14
Section 5.2 Knowledge Defined........................................ 15
Section 5.3 Survival of Seller's Representations and Warranties...... 16
Section 5.4 Covenants of Seller...................................... 16
Section 5.5 Representations and Warranties of Purchaser.............. 16
Section 5.6 Survival of Purchaser's Representations and Warranties... 17
ARTICLE VI DEFAULT
Section 6.1 Default by Purchaser..................................... 18
Section 6.2 Default by Seller........................................ 18
Section 6.3 Recoverable Damages...................................... 18
ARTICLE VII RISK OF LOSS
Section 7.1 Minor Damage............................................. 19
Section 7.2 Major Damage............................................. 19
Section 7.3 Definition of "Major" Loss or Damage..................... 20
ARTICLE VIII COMMISSIONS
Section 8.1 Brokerage Commissions.................................... 20
ARTICLE IX DISCLAIMERS AND WAIVERS
Section 9.1 No Reliance on Documents................................. 21
Section 9.2 AS-IS SALE; DISCLAIMERS.................................. 21
Section 9.3 Survival of Disclaimers.................................. 22
ARTICLE X MISCELLANEOUS
Section 10.1 Confidentiality.......................................... 22
Section 10.2 Public Disclosure........................................ 23
Section 10.3 Assignment............................................... 23
Section 10.4 Notices.................................................. 23
Section 10.5 Modifications............................................ 25
Section 10.6 Entire Agreement......................................... 25
Section 10.7 Further Assurances....................................... 25
Section 10.8 Counterparts............................................. 25
Section 10.9 Facsimile Signatures..................................... 25
Section 10.10 Severability............................................. 25
Section 10.11 Applicable Law........................................... 26
Section 10.12 No Third-Party Beneficiary............................... 26
Section 10.13 Captions................................................. 26
Section 10.14 Construction............................................. 26
Section 10.15 Recordation.............................................. 26
Section 10.16 Seller Approval.......................................... 26
Section 10.17 Time of the Essence.......................................26
EXHIBITS:
A DESCRIPTION OF LAND
B LIST OF PERSONAL PROPERTY
C LIST OF OPERATING AGREEMENTS
D LIST OF ENVIRONMENTAL REPORTS
E FORM OF DEED
F FORM OF ▇▇▇▇ OF SALE
G FORM OF ASSIGNMENT AND ASSUMPTION OF INTANGIBLES
H FORM OF FIRPTA CERTIFICATE
I LIST OF SPECIFIED LITIGATION
J LIST OF VIOLATION NOTICES