PURCHASE AND SALE AGREEMENT
AND JOINT ESCROW INSTRUCTIONS
February 3, 1998
BY AND BETWEEN
ALEXANDRIA REAL ESTATE EQUITIES, INC.
Buyer
AND
MATRIX PHARMACEUTICALS, INC.
Seller
PURCHASE AND SALE AGREEMENT
AND JOINT ESCROW INSTRUCTIONS
THIS PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (this
"Agreement") is made and entered into as of February 3, 1998, by and between
ALEXANDRIA REAL ESTATE EQUITIES, INC., a Maryland corporation ("Buyer"), and
MATRIX PHARMACEUTICALS, INC., a Delaware corporation ("Seller"), for the
purposes of setting forth the agreement of the parties and of instructing
CHICAGO TITLE INSURANCE COMPANY ("Escrow Agent"), with respect to the
transactions contemplated by this Agreement.
RECITALS
Upon and subject to the terms and conditions set forth in this
Agreement, Seller desires to sell and Buyer desires to purchase the following
(collectively, the "Property"): (i) the fee interest in those certain parcels of
real property located in the City of San Diego, County of San Diego, State of
California, as legally described on Exhibit "A-1" and Exhibit "A-2" attached
hereto, together with all rights, privileges and easements appurtenant thereto
or used in connection therewith, including, without limitation, all minerals,
oil, gas and other hydrocarbon substances thereon, all development rights, air
rights, water, water rights and water stock relating thereto, all strips and
gores, and all of Seller's right, title and interest in and to any streets,
alleys, easements, rights-of-way, public ways, or other rights appurtenant,
adjacent or connected thereto or used in connection therewith (collectively, the
"Land"); (ii) all buildings, improvements, structures and fixtures now or
hereafter included or located on or in the Land (collectively, but excluding the
improvements and fixtures designated in Exhibit "A-3" attached hereto, the
"Improvements"), including, without limitation, that certain building commonly
known as 4757 Nexus Center Drive (the "Building"), and all apparatus, equipment,
appliances and other fixtures used in connection with the operation or occupancy
of the Land and the Improvements, such as heating, air conditioning or
mechanical systems and facilities used to provide any utility services,
refrigeration, ventilation, waste disposal or other services now or hereafter
located on or in the Land or the Improvements, but specifically excluding the
improvements and fixtures designated in Exhibit "A-3" attached hereto; (iii) all
tangible personal property, equipment and supplies now or hereafter owned by
Seller and located on or about the Land or the Improvements or attached thereto
or used in connection with the use, operation, maintenance or repair thereof,
including, without limitation, the personal property designated in Exhibit "B-1"
attached hereto, but excluding the personal property designated in Exhibit "B-2"
attached hereto (collectively, but excluding the personal property designated in
said Exhibit "B-2", the "Personal Property"); and (iv) all intangible property
(collectively, the "Intangible Property") now or hereafter owned by Seller and
used in connection with the Land, the Improvements or the Personal Property,
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including, without limitation, the Tenant Leases and the Service Contracts (each
as hereinafter defined), building trademarks and trade names, transferable
business licenses, architectural, site, landscaping or other permits,
applications, approvals, authorizations and other entitlements, transferable
guarantees and warranties covering the Land and/or Improvements, all contract
rights, books, records, reports, test results, environmental assessments,
as-built plans, specifications and other similar documents and materials
relating to the use or operation, maintenance or repair of the Property or the
construction or fabrication thereof, and all transferable utility contracts, but
specifically excluding any intangible property exclusively related to the
operation of Seller's business.
AGREEMENT
In consideration of the mutual covenants contained in this Agreement
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, Buyer and Seller hereby agree, and instruct
Escrow Agent, as follows:
1. AGREEMENT TO PURCHASE AND SELL.
Subject to all of the terms and conditions of this Agreement, Seller
agrees to sell, transfer and convey to Buyer, and Buyer agrees to acquire and
purchase from Seller, the Property, upon the terms and conditions set forth
herein.
2. PURCHASE PRICE.
The purchase price for the Property (the "Purchase Price") shall be the
sum of Eighteen Million Six Hundred Thousand Dollars ($18,600,000), payable as
follows:
2.1 Deposit. Within five (5) Business Days (as hereinafter defined)
following the date (the "Execution Date") which is the later of the dates set
forth next to Buyer's and Seller's signatures to this Agreement, Buyer shall
deposit into Escrow (as hereinafter defined) the sum of Five Hundred Fifty
Thousand Dollars ($550,000) (which amount, together with any and all interest
and dividends earned thereon, shall hereinafter be referred to as the "Deposit")
by wire transfer, or by certified or bank check, payable to the order of Escrow
Agent.
Escrow Agent shall invest the Deposit in insured money market accounts,
certificates of deposit, United States Treasury Bills or such other instruments
as Buyer may instruct from time to time. In the event of the consummation of the
purchase and sale of the Property as contemplated hereunder, the Deposit shall
be paid to Seller at the Closing (as defined in Section 6 below) and credited
against the Purchase
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Price. In the event the sale of the Property is not consummated because of the
termination of this Agreement by Buyer in accordance with any right to so
terminate provided herein, or the failure of any condition except for a default
of Buyer under this Agreement caused solely by Buyer, the Deposit shall be
returned to Buyer.
2.2 Balance. On the Closing Date (as defined in Section 6 below), Buyer
shall pay to Seller the balance of the Purchase Price over and above the Deposit
paid by Buyer under Section 2.1 above, by wire transfer of federal funds to
Escrow Agent, net of all prorations and adjustments as provided herein.
2.3 Allocation of Purchase Price. Subject to the prorations and
adjustments hereinafter provided, the Purchase Price shall be allocated among
the Land parcels, the Improvements, the Personal Property and the other Property
as Buyer and Seller shall mutually determine in good faith using, to the extent
required, the method set forth in section 1060 of the Internal Revenue Code of
1986 (as amended) and the Treasury Regulations promulgated thereunder for
purposes of filing Form 8594 with the Internal Revenue Service; provided,
however, that the parties agree that$16,000,000 shall be allocated to the Land
parcel described on Exhibit A-1 attached hereto and the other portions of the
Property located thereon or associated therewith, and $2,600,000 shall be
allocated to the Land parcel described on Exhibit A-2 attached hereto and the
other portions of the Property located thereon or associated therewith.
Notwithstanding such allocation of the Purchase Price, the sale of the Property
shall be on an all or nothing basis, the sale of each item of Property to be
conditioned upon the simultaneous sale of all other items of Property on a
concurrent basis, and Buyer shall have no right to purchase, and Seller shall
have no right to cause Buyer to purchase, less than all of the Property as an
entirety in accordance with the provisions of this Agreement. Both Buyer and
Seller agree that in all public filings and reports, including, without
limitation, any documentary or other transfer tax declarations and any federal,
state, or local income, sales, or use tax returns or declarations, the various
items of Property shall be valued as determined by Buyer.
3. OPENING OF ESCROW.
Promptly following the Execution Date, Buyer and Seller shall cause a
purchase and sale escrow ("Escrow") to be opened with Escrow Agent by delivery
to Escrow Agent of a fully executed copy of this Agreement (the "Opening of
Escrow"). This Agreement shall constitute escrow instructions to the Escrow
Agent as well as the agreement of the parties. Escrow Agent is hereby appointed
and designated to act as the Escrow Agent and instructed to deliver, pursuant to
the terms of this Agreement, the documents and funds to be deposited into Escrow
as herein provided. The parties hereto shall execute such additional escrow
instructions, not inconsistent with this Agreement as determined by counsel for
Buyer and Seller, as Escrow Agent shall deem reasonably necessary for its
protection, including Escrow Agent's general provisions, if
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any (as may be modified by Buyer, Seller and Escrow Agent). In the event of any
inconsistency between this Agreement and such additional escrow instructions,
the provisions of this Agreement shall govern.
4. ACTIONS PENDING CLOSING.
4.1 Due Diligence Period.
4.1.1 Due Diligence.
4.1.1.1 Property Documents. Within five (5) Business
Days after the Execution Date, Seller shall deliver or make available to Buyer
copies of all contracts, documents, leases, reports, books, records and other
materials relating to the Property, including, without limitation, as-built
plans and specifications, operating statements, income and expense records, rent
rolls, engineering tests, soil tests, a Phase One environmental/asbestos audit
of the Property, a Phase Two environmental audit of the Property, service
contracts, structural and mechanical reports, maps, plans, agreements,
governmental permits and approvals, appraisals, title policies, surveys,
construction warranties, and land studies (collectively, the "Property
Documents") to the extent in Seller's possession or control or in the possession
of its agents, auditors or independent contractors, all at Seller's sole cost
and expense.
4.1.1.2 Diligence Tests. At all reasonable times from
the Execution Date until the Closing or earlier termination of this Agreement,
Buyer, its agents and representatives shall be entitled at Buyer's sole cost and
expense to (i) enter onto the Property during normal business hours and upon
reasonable advance notice to Seller, to perform any inspections, investigations,
studies and tests of the Property, including, without limitation, physical,
structural, mechanical, architectural, engineering, soils, geotechnical and
environmental/asbestos tests that Buyer deems reasonable; (ii) upon reasonable
notice to Seller, cause an environmental assessment of the Property to be
performed; and (iii) review all Property Documents and Seller Documents and
examine and copy any and all books and records maintained by Seller or its
agents relating to the Property (including, without limitation, all documents
relating to utilities, zoning, and the access, subdivision and appraisal of the
Property).
4.1.1.3 Tenants. Within ten (10) days after the
Execution Date, Seller shall arrange for an introduction of Buyer to any tenant
of the Property and shall otherwise assist and cooperate with Buyer in providing
Buyer access to such tenants, subject to Seller's rights under any leases with
such tenants. Buyer and its agents, assigns and employees shall observe and
comply with all reasonable requests on the part of tenants at the Property
regarding entry into tenant facilities for purpose of inspection. Buyer may
conduct such inquiries and investigations of any and all tenants (or prospective
tenants) as Buyer, in its sole discretion, deems advisable or necessary.
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4.1.1.4 Insurance. Buyer agrees that during the Due
Diligence Period (as hereinafter defined) it shall carry, or cause its agent to
carry, workers' compensation and general liability insurance in the amount of
$1,000,000 per occurrence, which insurance shall name Seller as an additional
insured, and shall otherwise be issued by carriers and be in form reasonably
satisfactory to Seller. Buyer shall provide Seller with proof of such insurance
prior to commencing Buyer's physical inspections of the Property.
4.1.1.5 Indemnity and Repair. Buyer agrees to
indemnify, defend (with counsel reasonably acceptable to Seller) and hold
harmless Seller from any losses resulting from any final judgment by a court of
competent jurisdiction arising from any actual damage to the Property or any
injury to persons caused by any act of Buyer as a result of the inspections,
investigations or tests performed by Buyer, its agents or representatives or any
entry by Buyer or its agents or representatives onto the Property pursuant to
this Section 4.1.1, which indemnity shall survive the termination of this
Agreement or the Closing and delivery of the Deed (as hereinafter defined) for a
period of ninety (90) days; provided, however, that Buyer's indemnity hereunder
shall not include any losses, cost, damage or expenses resulting from (x) the
acts of Seller, its agents or representatives, or (y) the discovery of any
pre-existing condition of the Property. In addition, if this Agreement is
terminated, Buyer shall repair any material damage to the Property caused by its
entry thereon and shall restore the Property substantially to the condition in
which it existed prior to such entry; provided, however, that Buyer shall have
no obligation to repair any damage caused by Seller's negligence or willful
misconduct or to remediate, contain, ▇▇▇▇▇ or control any Material of
Environmental Concern (as hereinafter defined) or any hazardous defect that
existed at the Property prior to Buyer's entry thereon.
4.1.2 Termination Right. Buyer shall have the right at any
time during the period (the "Due Diligence Period") beginning upon the Execution
Date and ending on the date which is thirty (30) calendar days following the
Execution Date (the "Due Diligence Termination Date") to terminate this
Agreement if, during the course of Buyer's due diligence investigations of the
Property, Buyer determines in its sole and absolute discretion that the Property
is not acceptable to Buyer. Buyer may exercise such termination right by
delivering written notice of termination to Seller and Escrow Agent on or before
the Due Diligence Termination Date. Upon such termination, (i) Escrow Agent
shall return the Deposit to Buyer, (ii) the parties shall equally share the
cancellation charges of Escrow Agent and Title Company (as hereinafter defined),
and (iii) this Agreement shall automatically terminate and be of no further
force or effect and neither party shall have any further rights or obligations
hereunder, other than pursuant to any provision hereof which expressly survives
the termination of this Agreement. Upon the written request of Seller following
such termination, Buyer shall return to Seller all of the Property Documents
provided to Buyer and, provided that no dispute between Buyer and Seller then
exists, deliver to Seller copies of all non-
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confidential, non-privileged reports prepared by third parties for Buyer in
connection with its investigations of the Property. If Buyer does not exercise
such termination in writing prior to the Due Diligence Termination Date, then
Buyer's right to terminate this Agreement pursuant to this Section 4.1.2 shall
automatically lapse.
4.2 Title.
4.2.1 Deliveries. Buyer has obtained an ALTA extended coverage
preliminary title report (the "PTR") issued by Chicago Title Insurance Company
(in such capacity, "Title Company"), together with legible copies of all
documents referenced as exceptions therein. Not later than twenty (20) days
after the Execution Date, Seller shall deliver or cause to be delivered to Buyer
(a) a current or currently updated As-Built American Land Title Association
survey of the Property (the "Survey"), in form reasonably satisfactory to Buyer
and Title Company, prepared by a surveyor reasonably acceptable to Buyer and
licensed in the State of California and certified (using a surveyor's
certificate in substantially the same form as the certificate attached hereto as
Exhibit "C") to Buyer, Title Company, and such other persons or entities as
Buyer may, in its discretion, request, which Survey shall show any and all
matters which Buyer may reasonably require, including, without limitation, all
Improvements, all easements, all roads, all utilities, the number of parking
spaces, access to and from the Land, and drainage ditches, set-back lines,
protrusions, encroachments, and encumbrances affecting the same; and (b) a UCC
Search with regard to the Personal Property (the "UCC Search").
4.2.2 Buyer's Review of Title. Buyer shall have until the Due
Diligence Termination Date to notify Seller in writing of any objection which
Buyer may have to any exception reported in the PTR or matter shown on the
Survey or the UCC Search (or any updates thereof; provided, however, that if any
such updates are received by Buyer, Buyer shall have an additional five (5)
Business Days, regardless of the Due Diligence Termination Date, following
Buyer's receipt of such update and legible copies of all documents referenced
therein to notify Seller of objections to items shown on any such update).
Exceptions reported in the PTR and matters shown on the Survey or the UCC Search
(or any updates thereof) not objected to by Buyer as provided above shall be
deemed to be "Permitted Exceptions." As a condition to Closing, Seller shall
take all action necessary to remove from title to the Property any exceptions
and matters so objected to by Buyer, or in the alternative, Seller shall obtain
for Buyer title insurance insuring over such exceptions or matters, such
insurance to be in form and substance satisfactory to Buyer. If, prior to the
Closing, Seller is unable to remove or satisfactorily insure over any exceptions
or matters objected to by Buyer and Buyer is unwilling to take title subject
thereto, then, in addition to any and all other rights and remedies which Buyer
may have hereunder, Buyer may terminate this Agreement (in which case Escrow
Agent shall return the Deposit to Buyer, the parties shall equally share the
cancellation charges of Escrow Agent and Title Company, and
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neither party shall thereafter have any rights or obligations to the other
hereunder); provided, however, that if such objected to exceptions or matters
are not removed by the Closing Date, Buyer may elect, upon written notice on or
prior to such date, to (a) extend the Closing Date to allow Seller a reasonable
period of time to remove such objected to exceptions or matters or (b) proceed
to a timely Closing whereupon such objected to exceptions or matters shall be
deemed Permitted Exceptions. Seller shall in any event be required to discharge
and remove any and all liens and encumbrances affecting the Property which
secure an obligation to pay money (other than installments of real estate taxes
and assessments not delinquent as of the Closing) and, even though Buyer does
not expressly disapprove such liens, such liens and encumbrances shall not be
Permitted Exceptions.
4.2.3 Condition of Title at Closing. Upon the Closing, Seller
shall sell, transfer and convey to Buyer indefeasible fee simple title to the
Land and the Improvements thereon by a duly executed and acknowledged grant deed
in the form of Exhibit "D" attached hereto (the "Deed"), subject only to the
Permitted Exceptions. Prior to Closing, Seller shall not take any action or
commit or suffer any acts which would give rise to a variance from the current
legal description of the Land, or cause the creation of any exception or
encumbrance against or respecting the Land without the prior written consent of
Buyer, which consent Buyer may withhold in its sole discretion. Nothing in this
Section 4.2.3 shall preclude Buyer from disapproving title matters in accordance
with the provisions of Section 4.2.2 above.
4.2.4 Within ten (10) days of the Execution Date, Seller shall
deliver to Buyer property questionnaires in the form attached hereto as Exhibit
"E" (the "Property Questionnaires")completed to the reasonable satisfaction of
Buyer.
5. CONDITIONS PRECEDENT TO CLOSING.
5.1 Buyer's Conditions. The obligation of Buyer to render performance
under this Agreement is subject to the following conditions precedent (and
conditions concurrent, with respect to deliveries to be made by the parties at
Closing) ("Buyer's Conditions"), which conditions may be waived, or the time for
satisfaction thereof extended, by Buyer only in a writing executed by Buyer
(provided, however, that any such waiver shall not affect Buyer's ability to
pursue any remedy it may have with respect to any breach hereunder by Seller):
5.1.1 Title. Title Company shall be prepared and irrevocably
committed to issue to Buyer an American Land Title Association extended coverage
owner's policy of title insurance in favor of Buyer in an amount not less than
the Purchase Price showing indefeasible fee simple title to the Property vested
in Buyer, with those endorsements reasonably requested by Buyer, subject only to
the Permitted Exceptions (collectively, the "Owner's Title Policy").
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5.1.2 Seller's Due Performance. All of the representations and
warranties of Seller set forth herein shall be true and correct as of the
Closing Date, and Seller, on or prior to the Closing Date, shall have complied
with and/or performed all of the obligations, covenants and agreements required
on the part of Seller to be complied with or performed pursuant to the terms of
this Agreement. On the Closing Date, Seller shall deliver a certificate, in the
form of Exhibit "F" attached hereto (the "Seller's Certificate"), to Buyer
certifying that (i) all of the representations, covenants and warranties of
Seller made in or pursuant to this Agreement are true, accurate, correct and
complete as of the Closing, (ii) all conditions to the Closing that Seller was
to satisfy or perform have been satisfied and performed, and (iii) all
conditions to the Closing that Buyer was to perform have been satisfied and
performed.
5.1.3 Physical Condition of Property. Subject to the
provisions of Section 10 below, the physical condition of the Property shall be
substantially the same on the Closing Date as on the Execution Date, except for
reasonable wear and tear and any damages due to any act of Buyer or Buyer's
representatives.
5.1.4 Bankruptcy. No action or proceeding shall have been
commenced by or against Seller under the federal bankruptcy code or any state
law for the relief of debtors or for the enforcement of the rights of creditors
and no attachment, execution, lien or levy shall have attached to or been issued
with respect to the Property or any portion thereof.
5.1.5 Tenant Leases. At the Closing, Seller shall assign all
of Seller's rights and remedies under the Tenant Leases which Buyer has elected
in writing prior to the Closing to assume (collectively, the "Assumed Leases"),
including, without limitation, the right to any security deposits and prepaid
rent under the Assumed Leases, to Buyer pursuant to an assignment and assumption
of leases and security deposits (the "Assignment of Leases") in the form of
Exhibit "G" attached hereto, and Seller shall retain, pursuant to the Lease (as
hereinafter defined), all of the rights and obligations of the lessor under all
Tenant Leases other than the Assumed Leases (such Tenant Leases being referred
to herein as the "Retained Leases"); provided, however, that the parties agree
that that certain Industrial Multi-Tenant Lease between Seller, as "Landlord,"
and Advanced Tissue Sciences, Inc., as "Tenant," dated July 15, 1996, and that
certain Building Lease Agreement, dated August 9, 1996, between Seller, as
"Lessor," and ▇▇▇ California PCS, Inc., as "Lessee," for rooftop communication
facilities, shall remain and constitute Retained Leases and Buyer shall have no
right to elect to assume the same.
5.1.6 ▇▇▇▇ of Sale. At the Closing, Seller shall deliver to
Buyer a ▇▇▇▇ of sale and assignment (the "▇▇▇▇ of Sale and Assignment"), by
which Seller shall transfer to Buyer all the Personal Property and the
Intangible Property, including, without limitation, the Property Documents, but
excluding the Tenant Leases and any
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Service Contracts which Buyer has elected in writing prior to the Closing not to
assume, in each case free of all liens and encumbrances, in the form of Exhibit
"H" attached hereto.
5.1.7 Estoppel Certificates. Seller shall use commercially
reasonable efforts to deliver to Buyer, within fifteen (15) Business Days after
the Execution Date, estoppel certificates, each substantially in the form of
Exhibit "I" attached hereto, executed by each tenant under the Tenant Leases
(collectively, the "Estoppel Certificates"), and as a condition to Closing,
Seller shall deliver Estoppel Certificates from each tenant on or before the Due
Diligence Termination Date. Within the Due Diligence Period (or within five (5)
days after delivery with respect to each Estoppel Certificate which is delivered
after the expiration of the Due Diligence Period), Buyer shall review and
approve or disapprove the Estoppel Certificates, in their sole discretion. In
addition, not more than five (5) days prior to the Closing Date, Seller shall
deliver to Buyer an update for each of the Estoppel Certificates executed by
each tenant under the Tenant Leases (collectively, the "Estoppel Updates"),
which Estoppel Updates shall reflect that there have been no material adverse
changes since the date of the Estoppel Certificate and that any of Buyer's
objections to the Estoppel Certificates have been corrected or cured to Buyer's
satisfaction. Buyer shall review and approve or disapprove the Estoppel Updates,
in its sole discretion, prior to the Closing Date.
5.1.8 Nonforeign Affidavits. At the Closing, Seller shall
deliver to Buyer (i) the Nonforeign Affidavit (the "Nonforeign Affidavit") in
the form of Exhibit "J-1" attached hereto, and (ii) the California Form 590 (the
"Form 590") attached hereto as Exhibit "J-2", each executed by Seller.
5.1.9 Property Questionnaires. Buyer shall have received
Property Questionnaires for the Property, completed to the reasonable
satisfaction of Buyer, and no such Property Questionnaire shall indicate any
fact or circumstance that Buyer reasonably believes (based on advice of counsel)
would be likely to result in Buyer losing its status as a real estate investment
trust, as defined in Section 856 of the Internal Revenue Code (as amended), if
the transactions contemplated hereby are consummated.
5.1.10 New Lease. At the Closing, Seller shall execute and
deliver to Buyer a Lease (the "Lease"), in the form of Exhibit "K" to be
attached hereto, covering the entire Property, which Lease shall include the
terms set forth in Exhibit "K-1" attached hereto. Notwithstanding anything to
the contrary set forth herein, in the event that Seller and Buyer have not
agreed upon the form of Exhibit "K" before the Due Diligence Termination Date,
unless Buyer and Seller otherwise agree in writing, this Agreement shall
thereupon terminate and be of no further force or effect, Escrow Agent shall
return the Deposit to Buyer, Buyer shall pay the charges of Title Company and
Escrow Agent, and neither party shall have any further obligation hereunder
except
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for those obligations which by their terms survive the termination hereof.
5.1.11 Loan Agreement. At the Closing, Seller shall execute
and deliver to Buyer a Promissory Note, a Loan and Security Agreement and such
other instruments and agreements (including, without limitation, UCC-1's) as
Buyer may reasonably require (collectively, the "Loan Documents"), all in form
and substance satisfactory to Buyer in its discretion, in connection with the
contemplated loan from Buyer to Seller (the "Loan"), the principal terms of
which are set forth on Exhibit "L" attached hereto. Notwithstanding anything to
the contrary set forth herein, in the event that Seller and Buyer have not
agreed upon the form of the Loan Documents before the Due Diligence Termination
Date, unless Buyer and Seller otherwise agree in writing, this Agreement shall
thereupon terminate and be of no further force or effect, Escrow Agent shall
return the Deposit to Buyer, Buyer shall pay the charges of Title Company and
Escrow Agent, and neither party shall have any further obligation hereunder
except for those obligations which by their terms survive the termination
hereof.
5.1.12 Cooperation. Seller shall promptly deliver to Buyer
copies of such 10-K's, 10-Q's, 8-K's, proxy statements, annual reports,
contracts, documents and other materials as may be reasonably requested by Buyer
pertaining to the financial condition of Seller, including the latest monthly
and year-to-date financial statement, and a copy of Seller's Business Plan.
5.1.13 No Moratoria. No moratorium, statute, regulation,
ordinance, or federal, state, county or local legislation, or order, judgment,
ruling or decree of any governmental agency or of any court shall have been
enacted, adopted, issued, entered or pending which would adversely affect
Buyer's intended use of the Property.
5.1.14 Parking License. At the Closing, Seller and Buyer shall
execute and deliver a Parking License Agreement (the "Parking License") in form
and substance mutually acceptable to Buyer and Seller, granting the lessee
pursuant to the Lease a right to use such parking spaces located on the portion
of the Land described in Exhibit "A-2" attached hereto which, when combined with
the number of spaces available pursuant to the Lease entitles such lessee to use
not less than 201 parking spaces.
5.2 Failure of Buyer's Conditions. Subject and without limitation to
Buyer's rights hereunder, including, without limitation, Section 11.2 hereof, if
any of the Buyer's Conditions have not been fulfilled within the applicable time
periods, Buyer may:
5.2.1 Waive and Close. Waive the Buyer's Condition and close
Escrow in accordance with this Agreement, with or without adjustment or
abatement of
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the Purchase Price; or
5.2.2 Close. Close escrow without waiving or curing the
failure of the Buyer's Condition but without waiving any other rights which
Buyer may have against Seller, which rights are expressly reserved hereby; or
5.2.3 Terminate. Terminate this Agreement by written notice to
Seller and to Escrow Agent, in which event Escrow Agent shall return the Deposit
to Buyer, Seller shall pay the cancellation charges of Title Company and Escrow
Agent, and Buyer shall be entitled to pursue any other rights and remedies which
it may have against Seller in connection herewith.
5.3 Seller's Conditions. The obligation of Seller to render performance
under this Agreement is subject to the following conditions precedent (and
conditions concurrent with respect to deliveries to be made by the parties at
Closing) ("Seller's Conditions"), which conditions may be waived, or the time
for satisfaction thereof extended, by Seller only in a writing executed by
Seller (provided, however, that any such waiver shall not affect Seller's
ability to pursue any remedy it may have with respect to any breach hereunder by
Buyer):
5.3.1 Buyer's Due Performance. All of the representations and
warranties of Buyer set forth in Section 8 hereof shall be true and correct as
of the Closing Date, and Buyer, on or prior to the Closing Date, shall have
complied with and/or performed all of the obligations, covenants and agreements
required on the part of Buyer to be complied with or performed pursuant to the
terms of this Agreement; and
5.3.2 Loan. At the Closing, Buyer shall deposit with Escrow
Agent the proceeds of the Loan, and shall instruct Escrow Agent to disburse such
proceeds to Seller as Seller may direct immediately following the Closing.
5.3.3 Bankruptcy. No action or proceeding shall have been
commenced by or against Buyer under the federal bankruptcy code or any state law
for the relief of debtors or for the enforcement of the rights of creditors.
5.4 Failure of Seller's Conditions. Subject to Seller's rights under
Section 11.1 hereof in the event of a default by Buyer which results in the
failure of a Seller's Condition, in the event of the failure of a Seller's
Condition, Seller may terminate this Agreement by delivery of written notice to
Buyer and Escrow Agent, in which event Escrow Agent shall return the Deposit to
Buyer, the parties shall equally share the cancellation charges of Title Company
and Escrow Agent, and neither party shall thereafter have any rights or
obligations to the other hereunder.
6. CLOSING.
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6.1 Closing Date. Subject to the provisions of this Agreement, the
Closing shall take place on the fifth (5th) day after the Due Diligence
Termination Date, or on such other date as the parties hereto may agree. As used
herein, the "Closing" shall mean the recordation of the Deed in the Official
Records of the County of San Diego, State of California (the "Official
Records"), and the "Closing Date" shall mean the date upon which the Closing
actually occurs.
6.2 Deliveries by Seller. Not less than two (2) Business Days prior to
the Closing Date, Seller, at its sole cost and expense, shall deliver or cause
to be delivered into Escrow the following documents and instruments, each dated
as of the Closing Date and executed by Seller, in addition to the other items
and payments required by this Agreement to be delivered by Seller:
6.2.1 Deed. The original executed and acknowledged Deed
conveying the Property to Buyer or its nominee;
6.2.2 Nonforeign Affidavit. Two (2) originals of the
Nonforeign Affidavit, each executed by Seller;
6.2.3 Form 590. Two (2) duplicate originals of the Form 590,
each executed by Seller;
6.2.4 Lease and Parking License. Four (4) originals of (i) the
Lease, (ii) a Memorandum of Lease in recordable form, and (iii) the Parking
License, each executed by Seller;
6.2.5 Assignment of Leases. Four (4) original counterparts of
the Assignment of Leases, each executed by Seller;
6.2.6 Loan Documents. Four (4) original counterparts of each
of the Loan Documents, each executed by Seller;
6.2.7 ▇▇▇▇ of Sale and Assignment. Four (4) original
counterparts of the ▇▇▇▇ of Sale and Assignment, each executed by Seller;
6.2.8 Seller's Certificate. Four (4) original Seller's
Certificates, each executed by Seller;
6.2.9 Tenant Leases. An original (or certified copy if an
original is not available), fully executed counterpart of each of the Assumed
Leases and any amendments, modifications, supplements and restatements thereto,
and a certified copy of each of the Retained Leases and any amendments,
modifications, supplements and restatements thereto;
12
6.2.10 Proof of Authority. Such proof of Seller's authority
and authorization to enter into this Agreement and the transaction contemplated
hereby, and such proof of the power and authority of the individual(s) executing
or delivering any instruments, documents or certificates on behalf of Seller to
act for and bind Seller as may be reasonably required by Title Company or Buyer;
and
6.2.11 Other. Such other documents and instruments, signed and
properly acknowledged by Seller, if appropriate, as may be reasonably required
by Buyer, Escrow Agent or otherwise in order to effectuate the provisions of
this Agreement and the Closing of the transactions contemplated herein,
including, without limitation, reasonable or customary title affidavits and
indemnities.
6.3 Deliveries by Buyer. On or before the Closing, Buyer, at its sole
cost and expense, shall deliver or cause to be delivered into Escrow the
following: (i) the balance of the Purchase Price pursuant to Section 2 hereof
and Buyer's share of prorations and "Closing Costs" (as hereinafter defined), as
provided in Sections 6.5 and 6.6, respectively; (ii) four (4) original executed
counterparts of the Assignment of Leases; (iii) four (4) original executed
counterparts of the Lease, the Memorandum of Lease, the Parking License and the
Loan Documents to which Buyer is a party; (iv) such proof of Buyer's authority
and authorization to enter into this Agreement and the transaction contemplated
hereby, and such proof of the power and authority of the individual(s) executing
or delivering any instruments, documents or certificates on behalf of Buyer to
act for and bind Buyer as may be reasonably required by Title Company or Seller;
and (v) such other documents and instruments, signed and properly acknowledged
by Buyer, if appropriate, as may reasonably be required by Escrow Agent or
otherwise in order to effectuate the provisions of this Agreement and the
closing of the transactions contemplated herein.
6.4 Actions by Escrow Agent. Provided that Escrow Agent shall not have
received written notice from Buyer or Seller of the failure of any condition to
the Closing or of the termination of the Escrow and this Agreement, when Buyer
and Seller have deposited into Escrow the documents and funds required by this
Agreement, and Title Company is irrevocably and unconditionally committed to
issue the Owner's Title Policy concurrently with the Closing, Escrow Agent
shall, in the order and manner herein below indicated, take the following
actions:
6.4.1 Recording and Filing. Following Title Company's
acknowledgment that it is prepared and irrevocably committed to issue the
Owner's Title Policy to Buyer, first cause the Deed, and thereafter the
Memorandum of Lease and any other documents which the parties hereto may
mutually direct, to be recorded in the Official Records, and file such other
documents or instruments with the appropriate filing offices as the parties may
mutually direct, and obtain conformed copies
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thereof for distribution to Buyer and Seller.
6.4.2 Lease and Promissory Note. Date as of the Closing Date
(i) each counterpart of the Lease, and (ii) the original Promissory Note with
respect to the Loan, and deliver one fully-executed and dated counterpart of the
Lease and the original executed and dated Promissory Note to Buyer.
6.4.3 Funds. Upon receipt of confirmation of the recordation
of the Deed and such other documents as were recorded or filed pursuant to
Section 6.4.1 above, disburse all funds deposited with it by Buyer as follows:
(a) Pursuant to the "Closing Statement" (as hereinafter
defined), retain for Escrow Agent's own account all escrow fees and costs,
disburse to Title Company the fees and expenses incurred in connection with the
issuance of the Owner's Title Policy, and disburse to any other persons or
entities entitled thereto the amount of any other Closing Costs;
(b) Disburse to Seller an amount equal to the Purchase Price,
less or plus the net debit or credit to Seller by reason of the prorations and
allocation of Closing Costs provided for in this Section 6. Seller's portion (as
provided in Section 6.6 below) of the escrow fees, title fees and other Closing
Costs shall be paid pursuant to clause (a) above;
(c) Disburse to Seller an amount equal to the proceeds of the
Loan, less any costs to file or record any of the Loan Documents, which shall be
paid by Seller;
(d) Disburse to Buyer any remaining funds in the possession of
Escrow Agent after payments pursuant to (a), (b) and (c) above have been
completed.
6.4.4 Owner's Title Policy. Cause Title Company to issue the
Owner's Title Policy to Buyer.
6.4.5 Delivery of Documents. Deliver to Buyer and Seller each
one original of all documents, other than the Deed and the Promissory Note with
respect to the Loan, deposited into Escrow.
6.5 Prorations. Rentals, revenues, and other income, if any, from the
Property (other than income in connection with the Retained Leases), taxes,
assessments, improvement bonds, service or other contract fees, utility costs,
and other expenses affecting the Property shall be prorated between Buyer and
Seller as of the Closing Date. For purposes of calculating prorations, Buyer
shall be deemed to be in title to the Property, and therefore entitled to the
income (other than income in connec-
14
tion with the Retained Leases) and responsible for the expenses, after 12:01
a.m. on the Closing Date. Delinquent rentals in connection with the Assumed
Leases as of the Closing Date shall not be prorated, but when paid shall be the
sole property of Buyer and Seller hereby irrevocably assigns, as of the Closing
Date, its entire right, title and interest in and to such delinquent rentals
(including the right to collect to same) to Buyer. On the Closing Date, Buyer
shall be fully credited for (i) security deposits which were paid by tenants to
Seller under or in connection with the Assumed Leases, (ii) reimbursement
expenses and other sums owed by Seller to tenants for work or disputes which
occurred prior to the Closing Date or for work to be performed or allowances to
be granted to any tenants upon or after the Closing Date pursuant to any Assumed
Leases in existence as of the Closing Date, (iii) any commissions or brokerage
fees payable upon or after the Closing Date in connection with any Assumed
Leases in existence as of the Closing Date, and (iv) rentals already received by
Seller in connection with the Assumed Leases attributable to periods after the
Closing Date. All non-delinquent real estate taxes or assessments on the
Property shall be prorated based on the actual current tax ▇▇▇▇, but if such tax
▇▇▇▇ has not yet been received by Seller by the Closing Date or if supplemental
taxes are assessed after the Closing for the period prior to the Closing, the
parties shall make any necessary adjustment after the Closing by cash payment to
the party entitled thereto so that Seller shall have borne all taxes, including
all supplemental taxes, allocable to the period prior to the Closing and Buyer
shall bear all taxes, including all supplemental taxes, allocable to the period
after the Closing. If any expenses attributable to the Property and allocable to
the period prior to the Closing are discovered or billed after the Closing, the
parties shall make any necessary adjustment after the Closing by cash payment to
the party entitled thereto so that Seller shall have borne all expenses
allocable to the period prior to the Closing and Buyer shall bear all expenses
allocable to the period from and after the Closing. The provisions of this
Section 6.5 shall survive the Closing for a period of one (1) year.
Ten (10) days prior to the Closing, Escrow Agent shall deliver to each
of the parties for their review and approval a preliminary closing statement
(the "Preliminary Closing Statement") based on an income and expense statement
prepared by Seller, approved by Buyer, and delivered to Escrow Agent prior to
said date, setting forth (i) the proration amounts allocable to each of the
parties pursuant to this Section 6.5 and (ii) the Closing Costs allocable to
each of the parties pursuant to Section 6.6 hereof. Based on each of the party's
comments, if any, regarding the Preliminary Closing Statement, Escrow Agent
shall revise the Preliminary Closing Statement and deliver a final, signed
version of a closing statement to each of the parties at the Closing (the
"Closing Statement").
6.6 Closing Costs. Each party shall pay its own costs and expenses
arising in connection with the Closing (including, without limitation, its own
attorney and advisor fees), except the following costs (the "Closing Costs"),
which shall be allocated between the parties as follows:
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(i) Seller shall pay all documentary transfer, stamp, sales
and other taxes related to the transfer of the Property, one-half (1/2) of
Escrow Agent's escrow fees and costs, and all premiums, costs and fees related
to the delivery of the Owner's Title Policy (other than the cost of any
endorsements requested by Buyer), the cost of the Survey (if not already paid),
all brokerage commissions payable to ▇▇▇▇ ▇▇▇▇▇▇▇ & Company in connection
herewith and with the Lease, all recording fees related to the transfer of
ownership of the Property, and all recording or filling fees in connection with
the Loan.
(ii) Buyer shall pay one-half (1/2) of Escrow Agent's escrow
fees and costs, the cost of any endorsements to the Owner's Title Policy
requested by Buyer, and all recording fees related to the financing of Buyer's
acquisition of the Property.
6.7 Deliveries Outside of Escrow. Seller shall deliver possession of
the Property, subject to the Tenant Leases, to Buyer upon the Closing. Further,
Seller hereby covenants and agrees to deliver to Buyer, on or prior to the
Closing, the following items:
6.7.1 Approvals. Originals of the "Approvals" (as hereinafter
defined);
6.7.2 Intangible Property. The Intangible Property, including,
without limitation, the original Property Documents and the original Assumed
Leases; and
6.7.3 Personal Property. The Personal Property, including,
without limitation, all keys, pass cards, remote controls, security codes,
computer software and other devices relating to access to the Improvements.
7. SELLER'S REPRESENTATIONS AND WARRANTIES.
Seller represents and warrants to and agrees with Buyer that, as of the
date hereof and as of the Closing Date:
7.1 Title.
7.1.1 Ownership. Seller is the legal and equitable owner of
the Property, with full right to convey the same. Seller has not granted any
options or rights of first refusal or rights of first offer to third parties to
purchase or otherwise acquire an interest in the Property.
7.1.2 Encumbrances. To Seller's Knowledge (as hereinafter
defined), the Property is free and clear of all liens, encumbrances, claims,
rights, de-
16
mands, rights of way, easements, leases (other than the Tenant Leases),
agreements, covenants, conditions, and restrictions of any kind, except for (A)
the Permitted Exceptions, and (B) the Tenant Leases.
7.1.3 Encroachments. Except as shown on the Survey, there are
no encroachments on the Property from adjoining property, and the Property does
not encroach on adjoining property, easements, or streets.
7.1.4 Streets. To Seller's Knowledge, there are no existing,
proposed, or contemplated plans to widen, modify, or realign any street or
highway which affects the size of, use of, or set-backs on the Property.
7.2 Property Documents. The Property Documents required to be delivered
by Seller pursuant to the terms hereof constitute all of the material documents
relating to the Property and each such Property Document as delivered by Seller
constitutes a true, correct and complete copy of such Property Document in
Seller's possession or control. There are no commitments or agreements affecting
the Property which have not been disclosed by Seller to Buyer in writing.
7.3 Leases.
7.3.1 The schedule attached hereto as Exhibit "M" (the
"Schedule of Leases") is a true, correct and complete statement of all (i) the
leases, tenancies and occupancies, including any extensions, modifications,
amendments or guarantees thereof in effect at the Property (the "Tenant
Leases"), (ii) the tenants at the Property, (iii) the dates of the Tenant Leases
(including the commencement and expiration dates thereof), (iv) the annual base
rents payable, the base year for escalations, the currently escalated rents and
contributions to common area maintenance, operating expenses and insurance under
the Tenant Leases, (v) the security deposits held by or deposited with Seller
under the Tenant Leases, (vi) any and all options to extend, renew or cancel any
Tenant Leases or to expand or decrease the space covered by any Tenant Lease
(including any rights of first refusal), and (vii) any and all concessions,
allowances, credits, rebates, offsets or other cases for relief or adjustment,
including, without limitation, any unpaid reimbursements for tenant improvements
and any "free" or "reduced" rent.
7.3.2 There are no security deposits or arrearages in rent or
additional rent under any of the Tenant Leases except as set forth on the
Schedule of Leases. No rent has been prepaid under any Tenant Lease except as
set forth on the Schedule of Leases.
7.3.3 All of the services required to be supplied to each
tenant and maintained in connection with the Property are presently being
supplied and
17
maintained and will continue to be supplied and maintained up to and as of the
Closing Date.
7.3.4 Seller has received no notices of any failure of Seller
to supply any services which Seller is required to furnish pursuant to any
Tenant Lease.
7.3.5 Seller has received no notices of any items of work,
repair, maintenance or construction to be completed by Seller pursuant to any
Tenant Lease for the benefit of any tenant and Seller has no knowledge of any
such work to be done.
7.3.6 As of the Closing Date, no tenant shall be entitled to
any additional work during the term of its Tenant Lease, except as set forth on
the Schedule of Leases.
7.3.7 Except as set forth on the Schedule of Leases, Seller
has received no notice from any tenant (i) to cancel any Tenant Lease, (ii) that
such tenant is or may become unable or unwilling to perform any or all of its
obligations under its Tenant Lease, whether for financial or other reasons, or
that an action or proceeding, voluntary or involuntary, is pending or threatened
against such tenant under any section or sections of any bankruptcy or
insolvency law, or (iii) that such tenant disputes the base rent or escalation
rents or the computation of escalation rents pursuant to its Tenant Lease.
7.3.8 The Tenant Leases are in full force and effect and
Seller has received no notice of any default by the landlord thereunder and has
no knowledge of any fact or facts which would now or with the giving of notice
or the passage of time or both be a default under the terms thereof, except as
otherwise set forth on the Schedule of Leases.
7.3.9 As of the Closing Date, there will be no brokerage or
other leasing commissions payable in connection with any of the tenants or the
Tenant Leases or any new leases or amendments of existing Tenant Leases.
7.3.10 All of the Tenant Leases are assignable to Buyer in
connection with its purchase of the Property without the necessity for any
approval, consent or additional payment.
7.4 Condition of Property. To Seller's Knowledge, the Property is in
good condition and repair and free from any defects, including, without
limitation, environmental, erosion, drainage or soil problems, physical,
structural, mechanical, construction or electrical defects, defects in the
parking lot pavement, or defects in utility systems. There is no material fact
which has not been disclosed to Buyer in writing which has or could reasonably
be expected to have a material adverse effect
18
upon the Property, or the use or value thereof.
7.5 Special Assessments or Condemnation. To Seller's Knowledge, there
are not presently pending (i) any special assessments, except those shown as
exceptions on the PTR, or (ii) condemnation actions against the Property or any
part. Seller has not received notice of any contemplated special assessments or
eminent domain proceedings that would affect the Property.
7.6 Utilities. To Seller's Knowledge, all water, sewer, electric, gas,
telephone, and drainage facilities, and all other utilities required by law or
for the normal operation of the Property are (or will be prior to Closing)
installed to the property lines of the Property, have been (or will be prior to
Closing) connected to the Improvements pursuant to valid permits, are (or will
be prior to Closing) in good working order, and are (or will be prior to
Closing) adequate to service the Property.
7.7 Permits. Seller has obtained all appropriate licenses, permits,
easements, and rights of way, including proofs of dedication, which are required
to use and operate the Property.
7.8 Service Contracts. There are no service, maintenance, repair,
management, leasing, or supply contracts or other contracts (including, without
limitation, janitorial, elevator and landscaping agreements) affecting the
Property, oral or written, except as set forth on the schedule attached hereto
as Exhibit "N" (the "Service Contracts").
7.9 Employees. Attached hereto as Exhibit "O" is a schedule of
employees who are employed by Seller or the manager of the Property in the
operation, management or maintenance of the Property and the wages and benefits
that are paid to such employees, all of which are true and correct as of the
date hereof; there are no contracts covering such employees other than as set
forth on such schedule and the employment of each may be terminated without cost
at the option of Seller or the then owner of the Property upon not more than
thirty (30) days prior written notice.
7.10 Defaults. Seller is not in default of Seller's obligations or
liabilities pertaining to the Property or the Property Documents; nor, to
Seller's Knowledge, are there facts, circumstances, conditions, or events which,
after notice or lapse of time, would constitute a default. Seller has not
received notice or information that any party to any of the Property Documents
considers a breach or default to have occurred; nor has Seller any reason to
believe that there is likely to be a default under any of the documents.
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7.11 Consents and Releases. Seller has obtained all required consents,
releases, and permissions to convey good, marketable and indefeasible title to
Buyer.
7.12 Authority. This Agreement and all other documents delivered prior
to or at the Closing (i) have been duly authorized, executed, and delivered by
Seller; (ii) are binding obligations of Seller; (iii) are collectively
sufficient to transfer all of Seller's rights to the Property; and (iv) do not
violate the formation documents of Seller. Seller further represents that it is
a corporation, duly organized and existing in good standing under the laws of
the State of Delaware, with its principal place of business in California.
7.13 Bankruptcy. No filing or petition under the United States
Bankruptcy Law or any insolvency laws, or any laws for composition of
indebtedness or for the reorganization of debtors has been filed with regard to
Seller.
7.14 Certificates of Occupancy. Seller has (or will have prior to
Closing) all necessary, valid, final and unconditional certificates of
occupancy, or the equivalent permitting required by the applicable licensing
agency, for the current use and occupancy of the Property.
7.15 Foreign Investment In Real Property Tax Act. Seller is not a
foreign person within the meaning of 42 USCS ss. 1445(f)(3).
7.16 Existing Approvals. The documents set forth on Exhibit "P"
attached hereto (collectively, the "Approvals") are in full force and effect
and, to Seller's Knowledge, constitute all necessary or appropriate
certifications, approvals, consents, authorizations, licenses, and permits
required by any governmental authority in connection with the ownership,
development, use and maintenance of the Property (other than those related to
the manufacturing operations of Seller's business conducted therein). To
Seller's Knowledge, all of the Approvals are transferable to Buyer without the
necessity of any approval or consent or additional payment and no such transfer
will affect the validity thereof.
7.17 Insurance. There are currently in effect such casualty and general
liability insurance policies as are customarily maintained with respect to
similar properties. All premiums due on such insurance policies have been paid
by Seller and Seller will maintain such insurance policies from the date hereof
through the Closing Date or earlier termination of this Agreement. Seller has
not received and has no knowledge of any notice or request from any insurance
company requesting the performance of any work or alteration with respect to the
Property. Seller has received no notice from any insurance company concerning,
nor is Seller aware of, any defects or inadequacies in the Property which, if
not corrected, would result in the termination of insurance coverage or increase
its cost.
20
7.18 Litigation. There are no actions, suits or proceedings before any
judicial or quasi-judicial body, by any governmental authority or other third
party, pending, or to Seller's Knowledge, threatened, against or affecting all
or any portion of the Property and to Seller's Knowledge, there is no basis for
any such action. There are no actions, suits or proceedings pending,
contemplated or threatened by Seller in connection with all or any portion of
the Property or Seller's ownership, rights, use, development or maintenance
thereof, including, without limitation, tax reduction proceedings; and from and
after the date hereof, Seller shall not commence or allow to be commenced on its
behalf any action, suit or proceeding with respect to all or any portion of the
Property without the prior written consent of Buyer. No attachments, execution
proceedings, assignments for the benefit of creditors, insolvency, bankruptcy,
reorganization or other proceedings are pending, or, to Seller's best knowledge,
threatened, against Seller. In the event any proceeding of the character
described in this Section 7.18 is initiated prior to the Closing, Seller shall
promptly advise Buyer in writing.
7.19 Compliance with Laws. To Seller's Knowledge, the Property is in
full compliance with all existing laws, rules, regulations, ordinances and
orders of all applicable federal, state, city and other governmental authorities
in effect as of the date of this Agreement (collectively, "Laws"), including,
without limitation, all Laws with respect to zoning, building, fire and health
codes, environmental protection and sanitation and pollution control. Seller has
received no notice of, and has no knowledge of, any condition currently or
previously existing on the Property or any portion thereof which may give rise
to any violation of any existing Law applicable to the Property if it were
disclosed to the authorities having jurisdiction over the Property.
7.20 Toxic or Hazardous Materials.
7.20.1 Definitions.
(a) "Environmental Claim" means any claim, action, cause of
action, investigation or notice (written or oral) by any person or entity
alleging potential liability (including, without limitation, potential liability
for investigatory costs, cleanup costs, governmental response costs, natural
resources damages, property damages, personal injuries, or penalties) arising
out of, based on or resulting from (i) the manufacture, treatment, processing,
distribution, use, transport, handling, deposit, storage, disposal, leaking or
other presence, or release into the environment of any "Material of
Environmental Concern" (as hereinafter defined) in, at, on, under or about any
location, whether or not owned or operated by Seller or (ii) circumstances
forming the basis of any violation, or alleged violation, of any "Environmental
Law" (as defined below).
(b) "Environmental Laws" means all federal, state and local
laws and regulations relating to pollution or protection of human health or the
environment
21
(including, without limitation, laws and regulations relating to emissions,
discharges, releases or threatened releases of Materials of Environmental
Concern, or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of Materials of
Environmental Concern.
(c) "Material of Environmental Concern" means chemicals,
pollutants, contaminants, wastes, toxic substances, petroleum and petroleum
products.
7.20.2 Representations and Warranties. Seller represents and
warrants to and agrees with Buyer that, as of the date hereof, and as of the
Closing Date: (i) each of the Property and Seller is in full compliance with all
applicable Environmental Laws relating to the Property, which compliance
includes, but is not limited to, the possession by Seller of all permits and
other governmental authorities required under applicable Environmental Laws, and
compliance with the terms and conditions thereof; (ii) Seller has not received
any communication (written or oral), whether from a governmental authority,
citizens group, employee or other third party, that alleges that Seller is not
in such full compliance and there are no circumstances that may prevent or
interfere with such full compliance in the future; (iii) Seller has received no
written or oral notice or other communication that any Environmental Claim is
pending or threatened with regard to the Property; (iv) there are no present or,
to Seller's Knowledge, past actions, activities, circumstances, conditions,
events or incidents relating to the Property, including, without limitation, the
manufacture, treatment, processing, distribution, use, transport, handling,
deposit, storage, disposal, leaking, or other presence or release of any
Material of Environmental Concern, that could form the basis of any
Environmental Claim against Seller or against any person or entity, including,
without limitation, persons or entities whose liability for any such
Environmental Claim Seller has or may have retained or assumed either
contractually or by operation of law; and (v) without in any way limiting the
generality of the foregoing, (a) Seller has not stored, disposed or arranged for
the disposal of Materials of Environmental Concern on the Property, (b) there
are no underground storage tanks located on the Property, (c) there is no
asbestos contained in or forming part of any Improvement, including, without
limitation, any building, building component, structure or office space on the
Property, and (d) no polychlorinated biphenyls (PCBs) are used or stored at the
Property.
7.20.3 Indemnification. Seller agrees to indemnify, reimburse,
defend, and hold Buyer harmless from, for and against all demands, claims,
actions or causes of action, assessments, losses, damages, liabilities, costs
and expenses, including, without limitation, interest, penalties, reasonable
attorneys' fees, charges, disbursements and expenses, and reasonable
consultants' fees, charges, disbursements and expenses, asserted against,
resulting to, imposed on, or incurred by Buyer, directly or indirectly, in
connection with (i) the breach of any representation or warranty set forth in
Section 7.20.2 of this Agreement or (ii) any event or condition, whether known
or
22
unknown to Seller or disclosed in any report provided to Buyer, which results,
directly or indirectly, in an Environmental Claim, to the extent such event or
condition occurred, existed, or arose out of conditions that occurred or
existed, or were caused, in whole or in part, on or before the Closing.
7.21 No Restriction on Access. Seller has no knowledge of any pending
or threatened restriction or denial, governmental or otherwise, which would
prohibit or adversely affect the right of access to or from the Property from or
to the existing highways and roads (all of such existing highways and roads
being duly opened and dedicated to the municipality having jurisdiction
thereof).
7.22 Storm Drainage. To Seller's Knowledge, all storm water flowing
from the Property drains either into a public system or onto a permitted
location and through easements for the benefit of the Property.
7.23 Soils. Seller has no knowledge of any soil conditions adversely
affecting the Property or any part thereof or Buyer's intended use and
development thereof.
7.24 No Conflicts. The execution and delivery of this Agreement, the
consummation of the transactions herein contemplated, and compliance with the
terms of this Agreement will not conflict with, or, with or without notice or
the passage of time or both, result in a breach of any of the terms or
provisions of, or constitute a default under, any indenture, deed of trust,
mortgage, loan agreement, or other document, or instrument or agreement, oral or
written, to which Seller is a party or by which Seller or the Property is bound,
or any applicable regulation of any governmental agency, or any judgment, order
or decree of any court having jurisdiction over Seller or all or any portion of
the Property.
7.25 Survival. All of the representations, warranties and agreements of
Seller set forth in this Agreement shall be true upon the execution of this
Agreement, shall be deemed to be repeated at and as of the Closing Date without
the necessity of a separate certificate with respect thereto and shall survive
the delivery of the Deed and other Closing instruments and documents for a
period of 12 months. As used in this Agreement, the phrase "to Seller's
Knowledge" and words of similar import shall mean the best knowledge of Seller's
Chief Executive Officer, Seller's President and Seller's Vice President of
Operations, after reasonable inquiry and investigation of the files and
materials readily available to such persons. Seller represents and warrants that
the foregoing persons are those persons affiliated with Seller possessing the
greatest experience and familiarity with the Property, and that no other person
presently or previously affiliated with Seller possesses any equal or greater
familiarity and experience with the Property.
23
7.26 As-Is. Except as expressly set forth herein, including, without
limitation elsewhere in this Article 7, and except for those warranties implied
by law in the Deed, Seller shall convey the Property to Buyer in its present
"AS-IS" condition, without any warranties, expressed or implied.
8. BUYER'S REPRESENTATIONS AND WARRANTIES.
Buyer represents and warrants to and agrees with Seller that, as of the
date hereof, and as of the Closing Date:
8.1 No Conflicts. The execution and delivery of this Agreement, the
consummation of the transactions herein contemplated, and compliance with the
terms of this Agreement will not conflict with, or, with or without notice or
the passage of time or both, result in a breach of any of the terms or
provisions of, or constitute a default under, any indenture, deed of trust,
mortgage, loan agreement, or other document or instrument to which Buyer is a
party or by which Buyer is bound, or any applicable regulation of any
governmental agency, or any judgment, order or decree of any court having
jurisdiction over Buyer or all or any portion of the Property.
8.2 Due Organization; Consents. Buyer is a corporation duly organized
and existing in good standing under the laws of the State of Maryland with its
principal place of business in the State of California. All requisite corporate
action has been taken by Buyer in connection with entering into this Agreement,
and will be taken prior to the Closing in connection with the execution and
delivery of the instruments referenced herein and the consummation of the
transactions contemplated hereby. No consent of any partner, shareholder,
beneficiary, creditor, investor, judicial or administrative body, governmental
authority or other party is required in connection herewith which has not been
obtained.
8.3 Buyer's Authority; Validity of Agreements. Buyer has full right,
power and authority to purchase the Property from Seller as provided in this
Agreement and to carry out its obligations hereunder. The individual(s)
executing this Agreement and the instruments referenced herein on behalf of
Buyer have the legal power, right and actual authority to bind Buyer to the
terms hereof and thereof. This Agreement is and all other documents and
instruments to be executed and delivered by Buyer in connection with this
Agreement shall be duly authorized, executed and delivered by Buyer and shall be
valid, binding and enforceable obligations of Buyer.
8.4 Bankruptcy. No filing or petition under the United States
Bankruptcy Law or any insolvency laws, or any laws for composition of
indebtedness or for the reorganization of debtors has been filed with regard to
Buyer.
9. ADDITIONAL COVENANTS OF SELLER.
24
In addition to the covenants and agreements of Seller set forth
elsewhere in this Agreement, Seller covenants and agrees that between the date
hereof and the Closing Date:
9.1 Title. Seller shall not directly or indirectly sell, assign or
create any right, title or interest whatsoever in or to the Property, or create
or permit to exist thereon any lien, charge or encumbrance other than the
Permitted Exceptions, or enter into any agreement to do any of the foregoing,
including, without limitation, any new Tenant Leases (or renewals, modifications
or extensions of any Tenant Leases) or Service Contracts, without the prior
written consent of Buyer.
9.2 Notice of Change in Circumstances. Seller shall promptly notify
Buyer of any change in any condition with respect to the Property or any portion
thereof or of any event or circumstance of which Seller becomes aware subsequent
to the date of this Agreement which (a) materially, adversely affects the
Property or any portion thereof or the use or operation of the Property or any
portion thereof, (b) makes any representation or warranty of Seller to Buyer
under this Agreement untrue or misleading, or (c) makes any covenant or
agreement of Seller under this Agreement incapable or less likely of being
performed, it being expressly understood that Seller's obligation to provide
information to Buyer under this Section 9.2 shall in no way relieve Seller of
any liability for a breach by Seller of any of its representations, warranties,
covenants or agreements under this Agreement.
9.3 No Defaults; Maintenance of Property. Seller shall not default with
respect to the performance of any obligation relating to the Property,
including, without limitation, the payment of all amounts due and the
performance of all obligations with respect to the Tenant Leases, the Service
Contracts and any existing indebtedness relating to the Property. Seller shall
operate and maintain the Property in accordance with Seller's past practice and
all applicable Laws affecting the Property or any portion thereof.
9.4 Exclusive Negotiations. Seller shall (i) remove the Property from
the market, (ii) cease and refrain from any and all negotiations with any other
prospective optionees or purchasers of the Property, and (iii) advise Buyer of
any material negotiations with current or potential tenants at the Property.
9.5 Development Activities. Seller shall not take any actions with
respect to the development of the Property, including, without limitation,
applying for, pursuing, accepting or obtaining any permits, approvals or other
development entitlements from any governmental or other regulatory entities or
finalizing or entering into any agreements relating thereto without the prior
written consent of Buyer (which consent may be granted or withheld in Buyer's
sole and absolute discretion, except with
25
respect to the construction of improvements to the processing and manufacturing
facility located on the first floor of the Building, in which event Buyer's
consent may not be unreasonably withheld). Seller hereby agrees to reasonably
cooperate with Buyer in Buyer's efforts to obtain such governmental approvals as
Buyer deems necessary to permit Buyer to operate the Property as Buyer wishes.
9.6 No Pre-Paid Rent. Seller shall not accept any rent from any Tenant
(or any new tenant under any new lease to which Buyer has consented) for more
than one (1) month in advance of the payment date.
9.7 Service, Management and Employment Contracts. Seller shall not
enter into, extend, renew or replace any existing service, property management
or employment contracts in respect of the Property without the prior written
consent of Buyer (which consent may be withheld in Buyer's sole and absolute
discretion), unless the same shall be cancellable without penalty or premium,
upon not more than thirty (30) days' notice from the owner of the Property and
Seller shall immediately notify Buyer of any such entrance, extension, renewal
or replacement
9.8 New Leases. At Buyer's request, Seller shall advise Buyer of any
and all material negotiations with current or potential tenants of the Property.
Seller shall not enter into any new lease or extend any Lease without Buyer's
prior written consent, which consent may be withheld in Buyer's sole and
absolute discretion.
10. RISK OF LOSS.
10.1 Condemnation. If, prior to the Closing Date, all or any material
portion of the Property is taken by condemnation or eminent domain (or is the
subject of a pending or contemplated taking which has not been consummated),
Seller shall immediately notify Buyer of such fact. In such event, Buyer shall
have the option to terminate this Agreement upon written notice to Seller given
not later than thirty (30) days after receipt of such notice from Seller. Upon
such termination, Escrow Agent shall return the Deposit to Buyer, the parties
shall equally share the cancellation charges of Escrow Agent and Title Company,
and neither party shall have any further rights or obligations hereunder, other
than pursuant to any provision hereof which expressly survives the termination
of this Agreement. If any condemnation or eminent domain action is not material,
or if Buyer does not elect to terminate this Agreement, Seller shall assign and
turn over to Buyer, and, subject to the terms of the Lease, Buyer shall be
entitled to receive and keep, all awards for the taking by condemnation or Buyer
shall be deemed to have accepted the Property subject to the taking without
reduction in the Purchase Price. For purposes of this Section 10.1, a taking
action shall be deemed to be material if the value of the property which is
subject to such action equals or exceeds $100,000, or if such action otherwise
has an adverse affect upon Buyer's intended use, operation or development of the
Property.
26
10.2 Casualty. Prior to the Closing and notwithstanding the pendency of
this Agreement, the entire risk of loss or damage by earthquake, flood,
landslide, fire, hurricane, tornado or other casualty shall be borne and assumed
by Seller. If, prior to Closing any part of the Property is damaged or destroyed
by earthquake, flood, landslide, fire, hurricane, tornado or other casualty,
Seller shall immediately notify Buyer of such fact. In the event of a material
casualty, Buyer and, so long as such casualty was not the result of the
negligence or wilful misconduct of Seller, Seller, shall have the option to
terminate this Agreement in accordance with the preceding section upon written
notice to the other party given not later than thirty (30) days after receipt of
any such notice from Seller. If the casualty is not material, or if Buyer and
Seller do not elect to terminate this Agreement, Seller shall assign and turn
over, and Buyer shall be entitled to receive and keep, all insurance proceeds
payable with respect to such destruction (which shall then be repaired or not at
Buyer's option and cost), plus Seller shall pay over to Buyer an amount equal to
the deductible amount with respect to the insurance and any uninsured loss, and
the parties shall proceed to Closing pursuant to the terms hereof without
modification of the terms of this Agreement and without any reduction in the
Purchase Price. If this Agreement is not terminated by reason of any casualty,
Buyer shall have the right to participate in any adjustment of the insurance
claim. For purposes of this Section, a casualty shall be deemed to be material
if the estimated cost to repair the same equals or exceeds $250,000.
11. LIQUIDATED DAMAGES; SPECIFIC PERFORMANCE.
11.1 Liquidated Damages. IN THE EVENT THAT THE ESCROW AND THIS
TRANSACTION FAIL TO CLOSE SOLELY AS A RESULT OF THE DEFAULT OF BUYER IN THE
PERFORMANCE OF ITS OBLIGATIONS UNDER THIS AGREEMENT, BUYER AND SELLER AGREE THAT
SELLER'S ACTUAL DAMAGES WOULD BE IMPRACTICABLE OR EXTREMELY DIFFICULT TO FIX.
THE PARTIES THEREFORE AGREE THAT IN THE EVENT THAT ESCROW AND THIS TRANSACTION
FAIL TO CLOSE SOLELY AS A RESULT OF THE DEFAULT OF BUYER IN THE PERFORMANCE OF
ITS OBLIGATIONS HEREUNDER AND SELLER IS READY, WILLING AND ABLE TO PERFORM ITS
OBLIGATIONS HEREUNDER, SELLER, AS SELLER'S SOLE AND EXCLUSIVE REMEDY, IS
ENTITLED TO LIQUIDATED DAMAGES IN THE AMOUNT OF THE DEPOSIT (INCLUSIVE OF
INTEREST AND DIVIDENDS EARNED THEREON) THEN HELD BY ESCROW AGENT. IN THE EVENT
ESCROW FAILS TO CLOSE SOLELY AS A RESULT OF BUYER'S DEFAULT AND SELLER IS READY,
WILLING AND ABLE TO PERFORM ITS OBLIGATIONS HEREUNDER, THEN (1) THIS AGREEMENT
AND THE RIGHTS AND OBLIGATIONS OF BUYER AND SELLER HEREUNDER AND THE ESCROW
CREATED HEREBY SHALL TERMINATE, (2) ESCROW AGENT SHALL, AND IS HEREBY AUTHORIZED
AND INSTRUCTED TO, RETURN PROMPTLY TO BUYER AND
27
SELLER ALL DOCUMENTS AND INSTRUMENTS TO THE PARTIES WHO DEPOSITED THE SAME, AND
(3) ESCROW AGENT SHALL DELIVER THE DEPOSIT (INCLUSIVE OF INTEREST AND DIVIDENDS
EARNED THEREON) THEN HELD BY ESCROW AGENT TO SELLER PURSUANT TO SELLER'S
INSTRUCTIONS, AND THE SAME SHALL BE THE FULL, AGREED AND LIQUIDATED DAMAGES.
SELLER AND BUYER ACKNOWLEDGE THAT THEY HAVE READ AND UNDERSTAND THE PROVISIONS
OF THIS SECTION 11.1, AND BY THEIR INITIALS IMMEDIATELY BELOW AGREE TO BE BOUND
BY ITS TERMS.
/s/ JRG /s/ AG
----------------- ----------------
Seller's Initials Buyer's Initials
11.2 Default by Seller. In the event that the Closing of the
transaction contemplated in this Agreement does not occur by reason of any
default by Seller, then (i) Escrow Agent shall return the Deposit to Buyer and
(ii) Buyer shall be entitled to pursue any remedy available to it hereunder, at
law or in equity, other than the specific performance of this Agreement;
provided, however, that in the event that Seller's default hereunder is wilful
and Buyer and Seller have agreed upon the form of Lease and the Loan Documents,
Buyer shall also be entitled to pursue the specific performance of this
Agreement.
12. BROKERS.
Seller and Buyer each hereby represent, warrant to and agree with each other
that there are no broker or finder fees or commissions payable in
connection with the transaction contemplated hereby (including, without
limitation, the Lease), other than those payable to ▇▇▇▇ ▇▇▇▇▇▇▇ &
Company which shall be paid by Seller in accordance with a separate
agreement. Seller shall indemnify, protect, defend and hold Buyer
harmless from and against any and all claims, losses, damages, costs
and expenses (including attorneys' fees, charges and disbursements)
incurred by Buyer by reason of any breach or inaccuracy of the
representation, warranty and agreement of Seller contained in this
Section 12. Buyer shall indemnify, protect, defend and hold Seller
harmless from and against any and all claims, losses, damages, costs
and expenses (including attorneys' fees, charges and disbursements)
incurred by Seller by reason of any breach or inaccuracy of the
representation, warranty and agreement of Buyer contained in this
Section 12. The provisions of this Section 12 shall survive the Closing
or earlier termination of this Agreement.
13. CONFIDENTIALITY.
13.1 Buyer. Buyer agrees that until the Closing, except as otherwise
28
provided herein or required by law and except for the exercise by Buyer of any
remedy hereunder, Buyer shall (a) keep confidential the pendency of this
transaction and the documents and information supplied by Seller to Buyer, (b)
disclose such information only to Buyer's agents, employees, contractors,
consultants or attorneys, as well as lenders (if any), investment bankers,
venture capital groups, investors, title company personnel and Tenants, with a
need to know in connection with Buyer's review and consideration of the
Property, provided that Buyer shall inform all persons receiving such
information from Buyer of the confidentiality requirement and (to the extent
within Buyer's control) cause such confidence to be maintained, and (c) upon the
termination of this Agreement prior to the Closing, return to Seller promptly
upon request all copies of documents and materials supplied by Seller.
Disclosure of information by Buyer shall not be prohibited if that disclosure is
of information that is or becomes a matter of public record or public knowledge
as a result of the Closing of this transaction or from sources other than Buyer
or its agents, employees, contractors, consultants or attorneys.
13.2 Seller. Seller agrees that both prior to and after the Closing,
except as otherwise provided herein (including the Estoppel Certificates) or
required by law, and except for the exercise by Seller of any remedy hereunder,
Seller shall (a) keep confidential the pendency of this transaction with Buyer
and the identity of Buyer and the relationship between Buyer and the entity to
which Buyer may assign this Agreement or which Buyer designates as the party to
whom Seller shall convey the Property at the Closing, and (b) disclose such
information only to Seller's agents, employees, contractors, consultants or
attorneys, as well as Tenants and title company personnel, with a need to know
such information in connection with effecting this transaction, provided that
Seller shall inform all such persons receiving such confidential information
from Seller of the confidentiality requirement and (to the extent within
Seller's control) cause such confidence to be maintained. Disclosure of the
pendency of this transaction by Seller shall not be prohibited if that
disclosure is of information that is or becomes a matter of public record or
public knowledge as a result of the Closing of this transaction or from sources
other than Seller or its agents, employees, contractors, consultants or
attorneys.
14. INDEMNIFICATION.
Buyer hereby agrees to indemnify, defend and hold Seller harmless from
and against any claims, demands, obligations, losses, costs, damages,
liabilities, judgments or expenses (including reasonable attorneys' fees,
charges and disbursements) arising out of or in connection with the ownership,
operation or maintenance of the Property after the Closing. Seller hereby agrees
to indemnify, defend and hold Buyer harmless from and against any claims,
demands, obligations, losses, costs, damages, liabilities, judgments or expenses
(including reasonable attorneys' fees, charges and disbursements) arising out of
or in connection with the ownership, opera-
29
tion or maintenance of the Property prior to the Closing. Each party shall do,
execute and deliver, or shall cause to be done, executed and delivered, all such
further acts and instruments which the other party may reasonably request in
order to more fully effectuate the indemnifications provided for in this
Agreement. The provisions of this Section 14 shall survive the Closing.
15. MISCELLANEOUS PROVISIONS.
15.1 Governing Law. This Agreement and the legal relations between the
parties hereto shall be governed by and construed and enforced in accordance
with the laws of the State of California, without regard to its principles of
conflicts of law.
15.2 Entire Agreement; Modifications; Waiver.
15.2.1 Entire Agreement. This Agreement, including the
exhibits and schedules attached hereto, constitutes the entire agreement between
Buyer and Seller pertaining to the subject matter hereof and supersedes all
prior agreements, understandings, letters of intent, negotiations and
discussions, whether oral or written, of the parties, and there are no
warranties, representations or other agreements, express or implied, made to
either party by the other party in connection with the subject matter hereof
except as specifically set forth herein or in the documents delivered pursuant
hereto or in connection herewith. Without limiting the foregoing, upon the
execution of this Agreement, that certain Letter of Intent, dated November 6,
1997, between Buyer and Seller, shall terminate and be of no further force or
effect.
15.2.2 Modification. No supplement, modification, waiver or
termination of this Agreement shall be binding unless executed in writing by the
party to be bound thereby. No waiver of any provision of this Agreement shall be
deemed or shall constitute a waiver of any other provision hereof (whether or
not similar), nor shall such waiver constitute a continuing waiver unless
otherwise expressly provided.
15.3 Notices. All notices, consents, requests, reports, demands or
other communications hereunder (collectively, "Notices") shall be in writing and
may be given personally, by registered or certified mail, by Federal Express (or
other reputable overnight delivery service) by telex or telegram or by facsimile
transmission.
To Buyer: Alexandria Real Estate Equities, Inc.
▇▇▇ ▇. ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Secretary
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
30
With A Copy to: Alexandria Real Estate Equities, Inc.
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With A Copy To: Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
To Seller: Matrix Pharmaceuticals, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With A Copy To: ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP
▇▇▇ ▇. "▇" ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
To Escrow Agent: Chicago Title Company
▇▇▇ "▇" ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other address or such other person as the addressee party shall have
last designated by notice to the other party. Notices given by telex shall be
deemed to be received when answered back; notices given by facsimile
transmission shall be deemed to be received when confirmed; and all other
Notices shall have been deemed to have been given when received.
15.4 Expenses. Subject to the allocation of Closing Costs provided in
Section 6.6 hereof, whether or not the transactions contemplated by this
Agreement
31
shall be consummated, all fees and expenses incurred by any party hereto in
connection with this Agreement shall be borne by such party.
15.5 Assignment.
15.5.1 Seller's Right to Assign. Seller shall not have the
right, power, or authority to assign, pledge or mortgage this Agreement or any
portion of this Agreement, or to delegate any duties or obligations arising
under this Agreement, voluntarily, involuntarily, or by operation of law,
without Buyer's prior written consent.
15.5.2 Buyer's Right to Assign. Except as otherwise provided
in this Agreement, Buyer shall have the right, power, and authority to assign
this Agreement (including, without limitation, an assignment for security
purposes) or any portion of this Agreement or to delegate any duties or
obligations arising under this Agreement, voluntarily, involuntarily or by
operation of law, without Seller's consent, to any entity or person controlling,
controlled by or under common control with Buyer. Upon an assignment, Buyer
shall be relieved of all obligations under this Agreement and the Escrow, except
for its obligations under Section 4.1.1.5 hereof.
15.6 Severability. Any provision or part of this Agreement which is
invalid or unenforceable in any situation in any jurisdiction shall, as to such
situation and such jurisdiction, be ineffective only to the extent of such
invalidity and shall not affect the enforceability of the remaining provisions
hereof or the validity or enforceability of any such provision in any other
situation or in any other jurisdiction.
15.7 Successors and Assigns; Third Parties. Subject to and without
waiver of the provisions of Section 15.5 hereof, all of the rights, duties,
benefits, liabilities and obligations of the parties shall inure to the benefit
of, and be binding upon, their respective successors and assigns. Except as
specifically set forth or referred to herein, nothing herein expressed or
implied is intended or shall be construed to confer upon or give to any person
or entity, other than the parties hereto and their successors or assigns, any
rights or remedies under or by reason of this Agreement.
15.8 Counterparts. This Agreement may be executed in as many
counterparts as may be deemed necessary and convenient, and by the different
parties hereto on separate counterparts, each of which, when so executed, shall
be deemed an original, but all such counterparts shall constitute one and the
same instrument.
15.9 Headings. The section headings of this Agreement are for
convenience of reference only and shall not be deemed to modify, explain,
restrict, alter or affect the meaning or interpretation of any provision hereof.
15.10 Time of the Essence. Time shall be of the essence with respect to
32
all matters contemplated by this Agreement.
15.11 Further Assistance. In addition to the actions recited herein and
contemplated to be performed, executed, and/or delivered by Seller and Buyer,
Seller and Buyer agree to perform, execute and/or deliver or cause to be
performed, executed and/or delivered at the Closing or after the Closing any and
all such further acts, instruments, deeds and assurances as may be reasonably
required to consummate the transactions contemplated hereby.
15.12 Number and Gender. Whenever the singular number is used, and when
required by the context, the same includes the plural, and the masculine gender
includes the feminine and neuter genders.
15.13 Construction. This Agreement shall not be construed more strictly
against one party hereto than against any other party hereto merely by virtue of
the fact that it may have been prepared by counsel for one of the parties.
15.14 Post-Closing Access to Records. Upon receipt by Seller of Buyer's
reasonable written request at anytime and from time to time within a period of
one (1) year after the Closing, Seller shall make available (or cause its
property manager or asset manager, as applicable, to make available) to Buyer
and its accountants and designees, for inspection and copying during normal
business hours and at Buyer's sole cost and expense, (i) all accounting records
relating to the Property for the calendar year period ended December 31, 1997,
and for the period(s) from January 1, 1998, through the Closing Date, including,
without limitation, all general ledgers, cash receipts, cancelled checks and
other accounting documents or information reasonably requested by Buyer and
related to the Property, and (ii) all other records related to the Property, in
either case whether in the possession or control of Seller or Seller's property
manager, asset manager or other agent. In addition, in connection with any such
accounting information, Seller shall provide Buyer and Buyer's accountants with
a representation letter in form and substance customarily provided to certified
public accountants when performing an audit in accordance with generally
accepted auditing standards.
15.15 Exhibits. All exhibits attached hereto are hereby incorporated by
reference as though set out in full herein.
15.16 Attorneys' Fees. In the event that either party hereto brings an
action or proceeding against the other party to enforce or interpret any of the
covenants, conditions, agreements or provisions of this Agreement, the
prevailing party in such action or proceeding shall be entitled to recover all
costs and expenses of such action or proceeding, including, without limitation,
attorneys' fees, charges and disbursements, and the fees and costs of expert
witnesses.
33
15.17 Business Days. As used herein, the term "Business Day" shall mean
a day that is not a Saturday, Sunday or legal holiday. In the event that the
date for the performance of any covenant or obligation under this Agreement
shall fall on a Saturday, Sunday or legal holiday, the date for performance
thereof shall be extended to the next Business Day.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
BUYER:
ALEXANDRIA REAL ESTATE EQUITIES,
INC., a Maryland corporation
Execution Date: February 5, 1998 By: /s/ ▇▇▇▇ ▇. Gold
-----------------------------------
Name: ▇▇▇▇ ▇▇▇▇
----------------------------
Its: President
-----------------------------
SELLER:
MATRIX PHARMACEUTICALS, INC.,
a Delaware corporation
Execution Date: February 3, 1998 By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------
Its: Senior Vice President and CFO
-----------------------------
ESCROW AGENT:
The undersigned Escrow Agent accepts the foregoing Agreement of Purchase and
Sale and Joint Escrow Instructions and agrees to act as Escrow Agent under this
Agreement in strict accordance with its terms.
CHICAGO TITLE INSURANCE COMPANY Date: February 6, 1998
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
-----------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇
------------------
Its: Escrow Officer
------------------
34
LIST OF EXHIBITS
EXHIBIT "A-1" LEGAL DESCRIPTION OF IMPROVED PARCEL
EXHIBIT "A-2" LEGAL DESCRIPTION OF UNIMPROVED PARCEL
EXHIBIT "A-3" EXCLUDED IMPROVEMENTS AND FIXTURES
EXHIBIT "B-1" PERSONAL PROPERTY INVENTORY
EXHIBIT "B-2" EXCLUDED PERSONAL PROPERTY
EXHIBIT "C" SURVEYOR'S CERTIFICATE
EXHIBIT "D" DEED
EXHIBIT "E" PROPERTY QUESTIONNAIRE
EXHIBIT "F" SELLER'S CERTIFICATE
EXHIBIT "G" ASSIGNMENT OF LEASES
EXHIBIT "H" ▇▇▇▇ OF SALE AND ASSIGNMENT
EXHIBIT "I" ESTOPPEL CERTIFICATE
EXHIBIT "J-1" NONFOREIGN AFFIDAVIT
EXHIBIT "J-2" FORM 590
EXHIBIT "K" LEASE
EXHIBIT "K-1" LEASE TERM SHEET
EXHIBIT "L" LOAN TERM SHEET
EXHIBIT "M" TENANT LEASES
EXHIBIT "N" SERVICE CONTRACTS
EXHIBIT "O" EMPLOYEES
EXHIBIT "P" APPROVALS
35
Exhibit "A-1"
LEGAL DESCRIPTION OF IMPROVED PARCEL
Parcel 1 of Parcel Map 17892, in the City of San Diego, County of San
Diego, State of California, according to Map filed in the Office of the County
Recorder of San Diego County on August 6, 1997.
36
Exhibit "A-2"
LEGAL DESCRIPTION OF UNIMPROVED PARCEL
Parcel 2 of Parcel Map 17892, in the City of San Diego, County of San
Diego, State of California, according to Map filed in the Office of the County
Recorder of San Diego County on August 6, 1997.
37
Exhibit "A-3"
DESCRIPTION OF EXCLUDED IMPROVEMENTS AND FIXTURES
To be agreed upon by Buyer and Seller on or before the expiration of the Due
Diligence Period.
38
Exhibit "B-1"
PERSONAL PROPERTY INVENTORY
To be agreed upon by Buyer and Seller on or before the expiration of the Due
Diligence Period.
39
Exhibit "B-2"
EXCLUDED PERSONAL PROPERTY
To be agreed upon by Buyer and Seller on or before the expiration of the Due
Diligence Period.
40
Exhibit "C"
SURVEYOR'S CERTIFICATE
The undersigned hereby certifies to: Alexandria Real Estate Equities,
Inc.; and [TITLE COMPANY]; as of _______________as follows: that this survey was
actually made upon the ground and was completed on_____________; that this
survey and the other information, courses and distances shown thereon are
accurate; that the title lines and lines of actual possession are the same; that
the property description "closes" by mathematical calculation; that the land
depicted on the survey forms one contiguous parcel, uninterrupted by any strips,
gaps or gores; that this survey correctly shows the size, location and type of
all buildings, structures and other improvements on the property and all are
within the boundary lines and applicable setback lines (whether established by
subdivision plat, recorded restrictions or applicable zoning or building codes)
affecting the property; that there are no easements, rights-of-way or uses
affecting the property known to the undersigned or appeared from a careful
physical inspection of the same, other than those shown on the survey, together
with the applicable recording references; that municipal water, sanitary sewer,
telephone, electric and gas services for the operation of the property are
present on the property or within adjacent public rights-of-way or recorded
easements in the locations shown on the survey; that there are no party walls
with or encroachments upon adjoining premises, streets or alleys by any of the
buildings, structures or other improvements on the property, or encroachments
upon or party walls with the property by any building, structure or other
improvements situated upon any adjoining premises; that the buildings and other
improvements on the property do not overhang or encroach upon any easements or
rights-of-way of others; that all public streets necessary for access to the
property have been completed and dedicated and there is direct access between
such streets and the property; that the property contains _____________ square
feet (__________acres) and is located in a zoning district classification of
_____; that the property contains _____ ordinary parking spaces and ____
handicapped parking spaces, totaling _____ ordinary and handicapped parking
spaces; that the property lies within a flood hazard area designated as Flood
Zone ____, shown on special flood hazard map published by the Federal Emergency
Management Agency; that the street address of the property is _______________;
that the property shown on this survey is the same property described in the
following revised title insurance commitment:____________, Commitment Date:
______________; that the location of each easement, right-of-way over the land
of others are required for (i) access to and egress from the parcel over a duly
dedicated and accepted all-weather public street or highway, (ii) drainage of
surface or other water off the parcel, (iii) any utilities which currently serve
the parcel and the current improvements, or (iv) storm water and sanitary sewer
facilities which serve the parcel and the current improvements; unless otherwise
shown or detailed on the survey, the subject property does not serve any
adjoining property for drainage utilities, parking, ingress or egress. This
survey was made on the ground in accordance with the "Minimum ▇▇▇▇-
41
dard Detail Requirements and Classification for Land Title Surveys" jointly
established by ALTA and ACSM in 1992, and includes Items 1-4, 6-11 and 13, and
meets the accuracy requirements of an Urban Survey, as defined therein. This
survey also was made in accordance with the State of California Minimum
Standards of Practice for Land Surveyors.
42
Exhibit D
DEED
RECORDING REQUESTED BY
AND WHEN RECORDED RETURN TO:
Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
MAIL TAX STATEMENTS TO:
Alexandria Real Estate Equities, Inc.
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Property Manager
---------------------------------------------------------------------
Space above this line for Recorder's use only
GRANT DEED
A.P.N. _______________
The undersigned Grantor declares:
Documentary transfer tax is not shown pursuant to R&T ss. 11932
( ) computed on full value of property conveyed, or
( ) computed on full value less value of liens and encumbrances
remaining at time of sale.
( ) Unincorporated area (x) City of San Diego, and
FOR VALUABLE CONSIDERATION, the receipt and sufficiency of which is
hereby acknowledged, MATRIX PHARMACEUTICALS, INC., a Delaware corporation
("Grantor"), has granted, sold and conveyed, and by these presents does hereby
grant, sell and convey, unto [ALEXANDRIA REAL ESTATE EQUITIES, INC., a Maryland
corporation] ("Grantee"), that certain property located in the City and County
of San Diego, State of California and more particularly described on Exhibit "A"
attached hereto and incorporated herein by reference (the "Property").
TO HAVE AND TO HOLD the Property, together with all and singular the
rights and appurtenances thereto in anywise belonging unto the said Property,
subject only to non-delinquent taxes and assessments and the matters described
on Exhibit "B" attached hereto and incorporated herein by this reference.
43
IN WITNESS WHEREOF, Grantor has caused this Grant Deed to be executed
this ___ day of _________________, 1998.
MATRIX PHARMACEUTICALS, INC.
a Delaware corporation
By: _______________________________
Name:
Its:
44
STATE OF ___________________ )
: ss.
COUNTY OF _________________ )
On the __ day of _____________, 199__, before me, _______________
___________________________________________________________, personally appeared
__________________________________________________________________________, [ ]
personally known to me or o proved to me on the basis of satisfactory evidence
to be the person(s) whose name(s) is/are subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the
instrument the person(s), or the entity upon behalf of which the person(s)
acted, executed the instrument.
WITNESS my hand and official seal.
__________________________________
(SEAL)
45
Exhibit "A" to Grant Deed
LEGAL DESCRIPTION
46
Exhibit "B" to Grant Deed
PERMITTED EXCEPTIONS
47
Exhibit "E"
PROPERTY QUESTIONNAIRE
Attached.
48
Exhibit "F"
SELLER'S CERTIFICATE
The undersigned hereby certifies to ___________________("Buyer") that,
as of the date hereof,
(i) all of the representations, covenants and warranties of
____________________________. ("Seller") made in or pursuant to that certain
Purchase and Sale Agreement and Joint Escrow Instructions, dated as of
___________, 1997 (the "Agreement"), between Seller and Alexandria Real Estate
Equities, Inc. ("ARE") are true, accurate, correct and complete;
(ii) all conditions to the Closing (as such term is defined in the
Agreement) that Seller was to satisfy or perform have been satisfied and
performed; and
(iii) all conditions to the Closing that ARE or Buyer was to perform
have been satisfied and performed.
Dated: _________, 199__ ___________________________________,
a ____________________________
By: _______________________________
Name:
Title:
49
Exhibit "G"
ASSIGNMENT OF LEASES AND TENANT SECURITY DEPOSITS
THIS ASSIGNMENT OF LEASES AND TENANT SECURITY DEPOSITS ("Assignment")
is made and entered into as of the ___ day of ___________, 19__, by and between
_______________ ("Assignor"), and ______________ ("Assignee").
RECITALS
WHEREAS, Assignor, as landlord, has entered into those certain leases
identified on Exhibit "A" attached hereto and incorporated herein by reference
(collectively, together with all amendments, modifications, supplements,
restatements and guarantees thereof which are identified on said Exhibit "A,"
the "Assumed Leases"), for certain property located in the City of _________,
County of _________, State of _________;
WHEREAS, Assignor and Alexandria Real Estate Equities, Inc., a Maryland
corporation ("ARE"), have entered into that certain Purchase and Sale Agreement,
dated as of _________ (as amended, the "Purchase Agreement");
WHEREAS, pursuant to Section ____ of the Purchase Agreement, ARE has
assigned its interest in the Purchase Agreement to Assignee; and
WHEREAS, the Purchase Agreement requires Assignor and Assignee to
execute this Assignment.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Assignor and Assignee hereby agree
as follows:
1. Definitions. All capitalized terms used but not otherwise defined
herein shall have the respective meanings provided therefor in the Purchase
Agreement.
2. Assignment and Assumption. From and after the date hereof for the
remainder of the term of each of the Assumed Leases, Assignor hereby irrevocably
assigns, sets over, transfers, grants, bargains and conveys to Assignee all of
Assignor's right, title and interest in and to (i) the Assumed Leases and (ii)
all security deposits made under the Assumed Leases (the "Security Deposits").
Subject to the terms and conditions of the Purchase Agreement, Assignee hereby
accepts this Assignment of the Assumed Leases, the Security Deposits and the
rights granted herein. Assignee hereby expressly assumes, for itself and its
successors, assigns and legal representatives, the Assumed Leases and all of the
obligations and liabilities, fixed and contingent, of
50
Assignor thereunder first accruing and arising from and after the date hereof
with respect to the Assumed Leases and agrees to (a) be fully bound by all of
the terms, covenants, agreements, provisions, conditions, obligations and
liability of Assignor thereunder, which first accrue and arise from and after
the date hereof, and (b) keep, perform and observe all of the covenants and
conditions contained therein on the part of Assignor to be kept, performed and
observed, from and after the date hereof.
3. Indemnifications. Assignor hereby agrees to indemnify, protect,
defend and hold Assignee harmless from and against any and all claims, losses,
damages, costs and expenses (including, without limitation, reasonable
attorneys' fees, charges and disbursements) incurred or suffered by Assignee in
connection with the Assumed Leases and arising or accruing prior to the date
hereof. Assignee hereby agrees to indemnify, protect, defend and hold Assignor
harmless from and against any and all actions, suits, proceedings, claims,
losses, damages, costs and expenses (including, without limitation, reasonable
attorneys' fees, charges and disbursements) incurred or suffered by Assignor in
connection with the Assumed Leases and first arising and accruing on or after
the date hereof.
4. General Provisions.
4.1. Successors. This Assignment shall be binding upon and
inure to the benefit of the parties hereto and their respective heirs, legal
representatives, successors and assigns.
4.2 Counterparts. This Assignment may be executed in as many
counterparts as may be deemed necessary and convenient, and by the different
parties hereto on separate counterparts, each of which, when so executed, shall
be deemed an original, but all such counterparts shall constitute one and the
same instrument.
4.3. Governing Law. This Assignment and the legal relations of
the parties hereto shall be governed by and construed and enforced in accordance
with the laws of the State of California, without regard to its principles of
conflicts of law.
4.4 Construction with Respect to Principal Agreement. This
Assignment is made pursuant to and governed by all of the terms, conditions,
warranties, representations, disclaimers, indemnities and limitations of the
Purchase Agreement, which are incorporated herein by this reference.
4.5 No Other Leases Assigned. Except for the Assumed Leases,
Assignee has not assumed any obligations under or with respect to any other
leases heretofore entered into with respect to the Property, including, without
limitation, the Retained Leases, which obligations are retained by Assignor.
51
IN WITNESS WHEREOF, this Assignment was made and executed as of the
date first above written.
ASSIGNOR:
____________________________________
By: _______________________________
Name:
Its:
ASSIGNEE:
____________________________________
By: _______________________________
Name:
Its:
52
Exhibit "H"
▇▇▇▇ OF SALE AND ASSIGNMENT
THIS ▇▇▇▇ OF SALE AND ASSIGNMENT ("▇▇▇▇ of Sale") is made as of
____________, 1997, by _______________, a _______________ ("Seller"), to
_____________________, a ________________________ ("Buyer").
RECITALS
WHEREAS, Seller is the owner of that certain real property located in
the County of ________________, State of ____________(the "Real Property"), as
more particularly described on Exhibit "A" attached hereto and incorporated
herein by reference;
WHEREAS, Buyer and Seller have entered into that certain Purchase and
Sale Agreement and Joint Escrow Instructions (the "Purchase Agreement"), dated
as of ___________, 1998, with respect to, among other things, the acquisition of
the "Personal Property" and the "Intangible Property" (each as defined below),
and certain other property; and
WHEREAS, the Purchase Agreement requires Seller to convey all of
Seller's right, title and interest in, to and under the Personal Property and
the Intangible Property to Buyer.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Seller hereby agrees as follows:
1. Unless the context otherwise requires, all capitalized terms used
but not otherwise defined herein shall have the respective meanings provided
therefor in the Purchase Agreement.
2. Seller does hereby unconditionally, absolutely, and irrevocably
grant, bargain, sell, transfer, assign convey, set over and deliver unto Buyer
all of Seller's right, title and interest in and to:
a. all tangible personal property now or hereafter owned by
Seller and located on or about the Land or Improvements or attached thereto or
used in connection with the use, operation, maintenance or repair thereof
(collectively, the "Personal Property"), including, without limitation, the
personal property described on Exhibit B-1 attached hereto, but expressly
excluding the personal property described on Exhibit B-2 attached hereto; and
53
b. all intangible property now or hereafter owned by Seller
and used in connection with the Land, the Improvements or the Personal Property,
including, without limitation, the Service Contracts identified on Schedule 1
attached hereto (the "Assumed Service Contracts"), building trademarks and trade
names, transferable business licenses, permits, applications, authorizations and
other entitlements, transferable guarantees and warranties covering the Land
and/or Improvements, all contract rights, books, records, reports, test results,
environmental assessments, and other similar documents and materials relating to
the use or operation, maintenance or repair of the Property or the construction
or fabrication thereof, and all transferable utility contracts, but specifically
excluding any intangible property exclusively related to the operation of
Seller's business (collectively, the "Intangible Property" and, together with
the Personal Property, the "Property").
3. Buyer hereby expressly assumes, for itself and its successors,
assigns and legal representatives, the Assumed Service Contracts and all of the
obligations and liabilities, fixed and contingent, of Seller thereunder accruing
from and after the date hereof with respect thereto and agrees to (a) be fully
bound by all of the terms, covenants, agreements, provisions, conditions,
obligations and liability of Seller thereunder, which accrue from the date
hereof, and (b) keep, perform and observe all of the covenants and conditions
contained therein on the part of Seller to be kept, performed and observed, from
and after the date hereof.
4. Seller represents and warrants that its title to the Property is
free and clear of all liens, mortgages, pledges, security interests, prior
assignments, encumbrances and claims of any nature other than the Permitted
Exceptions.
5. Seller hereby agrees to indemnify, protect, defend and hold Buyer
harmless from and against any and all claims, losses, damages, costs and
expenses (including, without limitation, reasonable attorney's fees and
disbursements) incurred or suffered by Buyer in connection with the Property and
arising prior to the Closing. Buyer hereby agrees to indemnify, protect, defend
and hold Seller harmless from and against any and all claims, losses, damages,
costs and expenses (including, without limitation, reasonable attorney's fees
and disbursements) incurred or suffered by Seller in connection with the
Property and arising on or after the Closing.
6. This ▇▇▇▇ of Sale shall be binding upon and inure to the benefit of
the parties hereto and their respective heirs, legal representatives, successors
and assigns.
7. This ▇▇▇▇ of Sale and the legal relations of the parties hereto
shall be governed by and construed and enforced in accordance with the laws of
the State of California, without regard to its principles of conflicts of law.
IN WITNESS WHEREOF, this ▇▇▇▇ of Sale was made and executed as of the
54
date first above written.
SELLER:
_________________________________, a
_________________________________
By:______________________________
Its:_____________________________
55
Exhibit "I"
ESTOPPEL CERTIFICATE
THIS TENANT ESTOPPEL CERTIFICATE ("Certificate"), dated as of ________,
19__, is executed by ("Tenant") in favor of Alexandria Real Estate Equities,
Inc., a Maryland corporation, together with its nominees, designees and assigns
(collectively, "Buyer").
RECITALS
A. Buyer and ____________ ("Landlord"), have entered into that certain
Purchase and Sale Agreement and Joint Escrow Instructions, dated as of
_________, 19__ (the "Purchase Agreement"), whereby Buyer has agreed to
purchase, among other things, the improved real property located in the City of
_________, County of _________, State of _________, more particularly described
on Exhibit "A" attached to the Purchase Agreement (the "Property").
B. Tenant and Landlord have entered into that certain Lease Agreement,
dated as of ___________ (together with all amendments, modifications,
supplements, guarantees and restatements thereof, the "Lease"), for a portion of
the Property.
C. Pursuant to the Lease, Tenant has agreed that upon the request of
Landlord, Tenant would execute and deliver an estoppel certificate certifying
the status of the Lease.
D. In connection with the Purchase Agreement, Landlord has requested
that Tenant execute this Certificate with an understanding that Buyer will rely
on the representations and agreements below.
NOW, THEREFORE, Tenant certifies, warrants, and represents to Buyer as
follows:
Section 1. Lease.
Attached hereto as Exhibit "1" is a true, correct and complete copy of
the Lease, including the following amendments, modifications, supplements,
guarantees and restatements thereof, which together represent all of the
amendments, modifications, supplements, guarantees and restatements thereof:
________________________________________________________________________________
________________________________________________________________________________
(If none, please state "None.")
56
Section 2. Leased Premises.
Pursuant to the Lease, Tenant leases those certain premises (the
"Leased Premises") consisting of approximately _______________ (________)
rentable square feet within the Property, as more particularly described in the
Lease. In addition, pursuant to the terms of the Lease, Tenant has the
[non-exclusive] right to use [_____ parking spaces/the parking area] located on
the Property during the term of the Lease. [Cross-out the preceding sentence or
portions thereof if inapplicable.]
Section 3. Full Force of Lease.
The Lease has been duly authorized, executed and delivered by Tenant,
is in full force and effect has not been terminated and constitutes a legally
valid instrument, binding and enforceable against Tenant in accordance with its
terms, subject only to applicable limitations imposed by laws relating to
bankruptcy and creditor's rights.
Section 4. Complete Agreement.
The Lease constitutes the complete agreement between Landlord and
Tenant for the Leased Premises and the Property, except as modified by the Lease
amendments noted above (if any), has not been modified, altered or amended.
Section 5. Acceptance of Leased Premises.
Tenant has accepted possession and is currently occupying the Leased
Premises.
Section 6. Lease Term.
The term of the Lease commenced on ______________ and ends on
_______________, subject to the following options to extend: ___________________
_______________________________________________.
(If none, please state "None.")
Section 7. Purchase Rights.
Tenant has no option, right of first refusal, right of first offer, or
other right to acquire or purchase all or any portion of the Leased Premises or
all or any portion of, or interest in, the Property, except as follows: ________
________________________________________________________________________________
_____________________.
(If none, please state "None.")
Section 8. Rights of Tenant.
57
Except as expressly stated in this Certificate, Tenant:
(a) has no right to renew or extend the term of the Lease;
(b) has no option or other right to purchase all or any part of the
Leased Premises or all or any part of the Property;
(c) has no right, title, or interest in the Leased Premises, other than
as Tenant under the Lease.
Section 9. Rent.
(a) The obligation to pay rent under the Lease commenced on
___________. The rent under the Lease is current, and Tenant is not in default
in the performance of any of its obligations under the Lease.
(b) Tenant is currently paying base rent under the Lease in the amount
of ___________________ Dollars ($__________) per month. Tenant has not received
and is not, presently, entitled to any abatement, refunds, rebates, concessions
or forgiveness of rent or other charges, free rent, partial rent, or credits,
offsets or reductions in rent, except as follows: ______________________________
_______________________________________________.
(If none, please state "None.")
(c) Tenant's estimated share of operating expenses, common area
charges, insurance, real estate taxes and administrative and overhead expenses
is __________ percent ( %) and is currently being paid at the rate of
_____________________ Dollars ($__________) per month, payable to: _____________
_______________________________________________.
(d) There are no existing defenses or offsets against rent due or to
become due under the terms of the Lease, and there presently is no default or
other wrongful act or omission by Landlord under the Lease or otherwise in
connection with Tenant's occupancy of the Leased Premises, nor is there a state
of facts which with the passage of time or the giving of notice or both could
ripen into a default on the part of Tenant, or to the best knowledge of Tenant,
could ripen into a default on the part of Landlord under the Lease, except as
follows: _______________________________________________________________________
_______________________________________________.
(If none, please state "None.")
Section 10. Security Deposit.
58
The amount of Tenant's security deposit held by Landlord under the
Lease is _________________ Dollars ($ __________).
Section 11. Prepaid Rent.
The amount of prepaid rent, separate from the security deposit, is
__________________________ Dollars ($___________), covering the period from to .
Section 12. Insurance.
All insurance, if any, required to be maintained by Tenant under the
Lease is presently in effect.
Section 13. Pending Actions.
There is not pending or, to the knowledge of Tenant, threatened against
or contemplated by the Tenant, any petition in bankruptcy, whether voluntary or
otherwise, any assignment for the benefit of creditors, or any petition seeking
reorganization or arrangement under the federal bankruptcy laws or those of any
state.
Section 14. Tenant Improvements.
As of the date of this Certificate, to the best of Tenant's knowledge,
Landlord has performed all obligations required of Landlord pursuant to the
Lease; no offsets, counterclaims, or defenses of Tenant under the Lease exist
against Landlord; and no events have occurred that, with the passage of time or
the giving of notice, would constitute a basis for offsets, counterclaims, or
defenses against Landlord, except as follows:__________________________________
_______________________________________________________________________________.
(If none, please state "None.")
Section 15. Assignments by Landlord.
Tenant has received no notice of any assignment, hypothecation or
pledge of the Lease or rentals under the Lease by Landlord.
Section 16. Assignments by Tenant.
Tenant has not sublet or assigned the Leased Premises or the Lease or
any portion thereof to any sublessee or assignee. No one except Tenant and its
employees will occupy the Leased Premises. The address for notices to be sent to
Tenant is as set forth in the Lease.
59
Section 17. Environmental Matters.
The operation and use of the Leased Premises does not involve the
generation, treatment, storage, disposal or release into the environment of any
hazardous materials, regulated materials and/or solid waste, except those used
in the ordinary course of operating a retail store or otherwise used in
accordance with all applicable laws.
Section 18. Succession of Interest.
Tenant agrees that, in the event Buyer succeeds to interest of Landlord
under the Lease:
(a) Buyer shall not be liable for any act or omission of any prior
landlord (including Landlord);
(b) Buyer shall not be liable for the return of any security deposit;
(c) Buyer shall not be bound by any rent or additional rent which
Tenant might have prepaid under the Lease for more than the current month;
(d) Buyer shall not be bound by any amendments or modifications of the
Lease made without prior consent of Buyer;
(e) Buyer shall not be subject to any offsets or defenses which Tenant
might have against any prior landlord (including Landlord); or
(f) Buyer shall not be liable under the Lease to Tenant for the
performance of Landlord's obligations under the Lease beyond Buyer's interest in
the Property.
Section 19. Notice of Default.
Tenant agrees to give Buyer a copy of any notice of default under the
Lease served upon Landlord at the same time as such notice is given to the
Landlord. Tenant further agrees that if Landlord shall fail to cure such default
within the applicable grace period, if any, provided in the Lease, then Buyer
shall have an additional sixty (60) days within which to cure such default, or
if such default cannot be cured within such sixty (60) day period, such sixty
(60) day period shall be extended so long as Buyer has commenced and is
diligently pursuing the remedies necessary to cure such default (including, but
not limited to, commencement of foreclosure proceedings, if necessary to effect
(such cure), in which event the Lease shall not be terminated while such
remedies are being pursued.
Section 20. Notification by Tenant.
60
From the date of this Certificate and continuing until ____________,
Tenant agrees to immediately notify Buyer, in writing by registered or certified
mail, return receipt requested, at the following addresses, on the occurrence of
any event or the discovery of any fact that would make any representation
contained in this Certificate inaccurate:
If To Buyer: Alexandria Real Estate Equities, Inc.
▇▇▇ ▇. ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Secretary
With A Copy To: Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Tenant makes this Certificate with the knowledge that it will be relied
upon by Buyer in agreeing to purchase the Property.
Tenant has executed this Certificate as of the date first written above
by the person named below, who is duly authorized to do so.
TENANT
___________________________________________
By: _______________________________
Name:
Its:
61
Exhibit "J-1"
NONFOREIGN AFFIDAVIT
1. Section 1445 of the Internal Revenue Code of 1986, as
amended (the "IRC"), provides that a transferee of a United States real property
interest must withhold tax if the transferor is a foreign person.
2. In order to inform Alexandria Real Estate Equities, Inc., a
Maryland corporation, and its nominees, designees and assigns (collectively, the
"Transferee"), that withholding of tax is not required upon the disposition by
___________________ (the "Transferor"), of the United States real property more
particularly described on Exhibit "A" attached hereto and incorporated herein by
reference (the "Property"), the undersigned Transferor certifies and declares by
means of this certification, the following:
a. The Transferor is not a foreign person, foreign
corporation, foreign partnership, foreign trust or
foreign estate (as such terms are defined in the IRC
and the Income Tax Regulations).
b. Transferor's federal taxpayer identification number
is:
______________________________.
c. Transferor's address is:
_____________________________________________________
_____________________________________________________
_____________________________________________________
3. Transferor understands that this certification may be
disclosed to the Internal Revenue Service by Transferee and that any false
statement contained in this certification may be punished by fine, imprisonment
or both.
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Under penalties of perjury, Transferor declares that it has
carefully examined this certification and it is true, correct and complete.
Executed this __ day of ________, 19__ at .
TRANSFEROR
___________________________________________
By: _______________________________
Name:
Its:
63
Exhibit "J-2"
FORM 590
Attached.
64
Exhibit "K"
LEASE
Attached
65
Exhibit "K-1"
LEASE TERM SHEET
Lessor: Alexandria Real Estate Equities, Inc. or its assignee
Lessee: Matrix Pharmaceuticals, Inc.
Rentable Square Footage: 67,050 square feet (approximately)
Initial Base Rent: $1,920,000 per year, payable in advance in equal
monthly installments
Escalation of Base Rent: The Base Rent shall increase on the fifth (5th)
anniversary of the Lease Commencement Date by an
amount equal to the cumulative increase in the
Consumer Price Index for San Diego metropolitan
statistical area ("Index") for the previous fifth (5)
years but not less than 2% and not more than 4% for
any given year during the initial five (5) year
period. Thereafter, the Base Rent, including renewal
periods, shall increase every three (3) years by an
amount equal to the cumulative increases in the Index
for the previous three (3) years, but not less than 2%
and not more than 4% for any given year during the
three year period.
Security Deposit: $2,580,000 to be deposited with Lessor in cash or an
acceptable letter of credit in a form and with a
financial institution normally acceptable to Lessee
and Lessor ("Letter of Credit").
Percentage Reduction Amount Mileage Event
--------------------------- -------------
25% Lessee to have
completed strategic
alliances or joint
ventures with a
cumulative value in
excess of $10
million (value equal
to up front payments
plus milestone
payments).
25% Lessee corporate
sales from products
exceed $10 million.
Initial Lease Term: 13 years
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Options to Extend: Upon at least one year's prior notice, five (5)
consecutive five (5) year options to extend the term
at a mutually acceptable rent on the commencement date
of each such renewal term.
Late Charges: 3% of the amount delinquent, if any amount is not paid
within 10 days from the date notice of delinquency is
given to Lessee.
Expenses: Absolute net: Lessee shall be responsible for the
entire cost of maintaining and improving the Property,
which shall include, without limitation, all
maintenance, upkeep, cleaning, repairs, and
replacements of all improvements at the Property,
structural, and non-structural, all real and personal
property taxes, assessments and bonds pertaining to
the Property, public Liability, environmental,
earthquake and property damage insurance premiums, all
utilities and related services rendered or furnished
to the Property such as electricity, water, sewer,
heat, air, telephone, refuse and gas, and all related
charges and deposits, and costs of any tenant or other
capital improvements to the Property, as well as the
cost of property management which shall equal $2,000
per month.
Subleases: Lessee shall execute a present assignment of leases
and rents to Lessor whereby Lessee shall continue as
the Lessor ("Master Lessor") under the existing leases
to Advanced Tissue Sciences, Inc. and lessees of
rooftop space for antenna purposes (collectively, the
"Subleases"). The Subleases shall be subordinated to
Lessor's interest in the Property and the sublessees
shall attorn to Lessor. Upon any default by Lessee
under the Lease such Subleases shall make all rent
payments directly to Lessor.
Repurchase Rights: Option (A). Right of First Offer. Provided that Lessee
is not then in default under the Lease, in the event
Lessor determines that it intends to sell the
Property, it shall give Lessee at least 10 days' prior
written notice of such intent ("Lessor's Notice")
prior to actively marketing the Property to third
parties, and Lessee may elect, by delivery of written
notice to Lessor ("Lessee's Notice") within 10 days
after receipt of Lessor's Notice, to negotiate for the
acquisition of the Property. If Lessee so elects, the
parties shall meet and negotiate in good faith for the
purchase and sale of the Property for a period of 30
days following delivery of Lessor's Notice. In the
event that Lessor and Lessee are unable to agree upon
the terms of the sale within said 30 day period or in
the event that Lessee does not deliver Lessee's
Notice, then Lessor shall be entitled to thereafter
sell the Property to
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any third party purchaser, provided that any such
purchaser shall acquire the Property subject to
Lessee's right of first offer.
(B). Certain Terms of Sale. Any purchase and sale
pursuant to Lessee's right of first offer shall be
handled by Holder. The transaction shall close no
sooner than nine (9) and no later than twelve (12)
months after Lessee's written notification of election
to exercise right of first offer unless otherwise
mutually agreed in writing. The right of first offer
shall terminate at the end of the Lease term and any
extensions.
Indemnification: Lessee to provide Lessor with full indemnifications,
including without limitations indemnification for
damages suffered by reason of hazardous materials
utilized by Lessee.
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Exhibit "L"
LOAN TERM SHEET
Lender: Alexandria Real Estate Equities, Inc. or its assigns.
Borrower: Matrix Pharmaceuticals, Inc.
Loan Amount: $6,000,000
Interest Rate: 11%
Payment Terms: Interest only payable in advance in equal monthly
installments ($660,000 per annum).
Term: 4 years
Conversion Event: The loan shall be reduced in $3,000,000 increments and
shall convert into lease payments upon achievement of
the following milestone events.
1. Borrower to have completed strategic alliances or
joint ventures with a cumulative value in excess
of $10 million (value equal to up front payments
plus milestone payments);
2a. Borrower corporate sales from products exceed $10
million; or
2b. Borrower to have completed strategic alliances or
joint ventures with cumulative value in excess of
$15 million.
______________________________________________________
Conversion Lease Terms for each $3,000,000 reduction increment:
Initial Base Rent: $330,000 per year, payable in advance in equal monthly
installments, subject to escalation on the same terms
and time periods as provided in the Lease.
Other Lease Terms: All other terms and conditions of Lease apply.
Default: A default under the loan shall be a default under the
Lease.
Security: Borrower's manufacturing related building improvements
and fixtures.
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Exhibit "M"
TENANT LEASES
Attached
70
Exhibit "N"
SERVICE CONTRACTS
Attached
71
Exhibit "O"
EMPLOYEES
None.
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Exhibit "P"
APPROVALS
Attached.
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