REAL ESTATE SALE AGREEMENT (Ashburn Farm Market Center)
Exhibit 10.19
(Ashburn Farm Market Center)
THIS AGREEMENT is made as of the 30th day of October 2018, between THE ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ GROUP LLC, an Ohio limited liability company (referred to herein as “Buyer”), and REGENCY REALTY GROUP, INC., a Florida corporation (referred to herein collectively as “Seller”).
Background
Buyer wishes to purchase the following shopping center in the Commonwealth of Virginia from Seller, identified as:
Center | City | County |
Ashburn Farm Market Center | Ashburn | Loudoun |
Seller wishes to sell said shopping center to Buyer;
In consideration of the mutual agreements herein, and for other good and valuable consideration, the receipt of which is hereby acknowledged, Seller agrees to sell to Buyer and Buyer agrees to purchase from Seller said shopping center, subject to the following terms and conditions:
1. | DEFINITIONS |
As used in this Agreement, the following terms shall have the following meanings:
1.1 Agreement means this Real Estate Sale Agreement, which shall supersede all prior agreements and understandings between Buyer and Seller concerning the sale and purchase of the Seller’s interest in the shopping center.
1.2 Broker means Eastdil Secured, a licensed Virginia real estate broker, whose address is ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, the responsible broker being ▇▇▇▇ ▇▇▇▇▇.
1.3 Closing means generally the execution and delivery of those documents and funds necessary to effect the sale of the Seller’s interest in the shopping center to Buyer.
1.4 Closing Date means the date on which the Closing occurs.
1.5 Contracts means all service contracts and similar agreements concerning the furnishing of goods and services to Seller with respect to the Property.
1.6 ▇▇▇▇▇▇▇ Money Deposit means the deposits delivered by Buyer to Escrow Agent under Section 2.2 of this Agreement, together with the earnings thereon, if any.
1.7 Effective Date means the business day on which the last of the Buyer and Seller has executed this Agreement.
1.8 Environmental Law means any current legal requirement in effect at the Closing Date pertaining to (a) the protection of health, safety, and the indoor or outdoor environment, (b) the conservation, management, protection or use of natural resources and wildlife, (c) the protection or use of source water and groundwater, (d) the management, manufacture, possession, presence, use, generation, transportation, treatment, storage, disposal, release, threatened release, abatement, removal, remediation or handling of, or exposure to, any Hazardous Material or (e) pollution (including any release to air, land, surface water, and groundwater); and includes, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended by the Superfund Amendments and Reauthorization Act of 1986, 42 USC 9601 et seq., Solid Waste Disposal Act, as amended by the Resource Conservation Act of 1976 and Hazardous and Solid Waste Amendments of 1984, 42 USC 6901 et seq., Federal Water Pollution Control Act, as amended by the Clean Water Act of 1977, 33 USC 1251 et seq., Clean Air Act of 1966, as amended, 42 USC 7401 et seq., Toxic Substances Control Act of 1976, 15 USC 2601 et seq., Hazardous Materials Transportation Act, 49 USC App. 1801, Occupational Safety and Health Act of 1970, as amended, 29 USC 651 et seq., Oil Pollution Act of 1990, 33 USC 2701 et seq., Emergency Planning and Community Right-to-Know Act of 1986, 42 USC App. 11001 et seq., National Environmental Policy Act of 1969, 42 USC 4321 et seq., Safe Drinking Water Act of 1974, as amended by 42 USC 300(f) et seq., and any similar, implementing or successor law, any amendment, rule, regulation, order or directive, issued thereunder.
1.9 Escrow Agent means the firm identified as the Escrow Agent in Section 10.3 of this Agreement.
1.10 Hazardous Material means petroleum, petroleum products, drycleaning solvents and other hazardous or toxic substances as defined in or regulated by any Environmental Law in effect at the pertinent date or dates.
1.11 Improvements means all buildings, structures or other improvements owned by Seller, (but not those, if any, owned by tenants) situated on the Real Property, if any.
1.12 Inspection Period means the period of time which begins on the Effective Date and ends at 6:00 pm local Jacksonville, Florida time on November 28, 2018.
1.13 Leases means all written leases and other written occupancy agreements permitting persons to lease or occupy any portion of the Real Property and Improvements.
1.14 Major Tenants with respect to the Shopping Center, are those identified as such on Exhibit 1.14 attached hereto.
1.15 Materials means all plans, drawings, specifications, soil test reports, environmental assessments and similar documents concerning the Real Property and/or Improvements which are in Seller’s possession.
1.16 Permitted Exceptions means only the following interests, liens and encumbrances:
(a) | Liens for ad valorem taxes not payable on or before Closing; |
(b) | The exceptions noted with respect to the Real Property and Improvements in the Existing Title Policy and on the Existing Survey; |
(c) | The Leases; and |
(d) | Covenants, restrictions, easements and other matters of record; |
it being understood, however, that Buyer shall have the Inspection Period within which to determine whether any such item will materially and adversely affect Buyer’s contemplated use of the Property.
1.17 Personal Property means all (a) sprinkler, plumbing, heating, air-conditioning, electric power or lighting, incinerating, ventilating and cooling systems, with each of their respective appurtenant furnaces, boilers, engines, motors, dynamos, radiators, pipes, wiring and other apparatus, equipment and fixtures, elevators, partitions, fire prevention and extinguishing systems owned by Seller, located in or on the Improvements, (b) the Materials, (c) other tangible personal property used in connection with the ownership or operation of the Improvements, provided the same are now owned or are acquired by Seller, prior to the Closing, and (d) all trade names, franchises, licenses, permits, easements, development rights and approvals, deposits, credits oil, gas, petroleum and mineral interests and related royalties, air and water rights, construction and product warranties, the Leases (including all security deposits and guarantees given with respect thereto), Contracts and Materials, and all other intangibles owned by or for the benefit of Seller in connection with the shopping center. The previous provisions to the contrary notwithstanding, the term Personal Property shall specifically exclude all entrance, exit and leasing signs referencing “Regency”, “Regency Centers” or affiliated entities.
1.18 Property means collectively the Real Property, the Improvements and the Personal Property.
1.19 Purchase Price means the consideration agreed to be paid by Buyer for the purchase of the Seller’s interest in the shopping center as set forth in Section 2.1 (subject to prorations and adjustments as provided herein).
1.20 Real Property means the lands and easements more particularly described in the existing title policy with respect to the overall shopping center which is identified in Exhibit 1.20 hereof (the “Existing
Title Policy”), less and except any and all property previously conveyed by Seller. The Existing Title Policy has been previously delivered to Buyer.
1.21 Rent Roll means the Leases enumerated with respect to the Real Property and Improvements, as listed on Exhibit 1.21 of this Agreement, identifying with particularity the space leased by each tenant, the square footage and applicable rent, common area maintenance, tax and other reimbursements, and similar information concerning each of the Leases, together with a separate certificate setting forth security deposits held.
1.22 Seller’s Documents means those documents, instruments and materials identified on Exhibit 1.22 attached hereto.
1.23 Seller Financial Statements means the statements of income and expense prepared by Seller for the Property, as of and for the two (2) calendar years next preceding the date of this Agreement and all monthly and quarterly reports of income and expense prepared by Seller for the Property for any such period beginning after the latest of such calendar years, and ending prior to Closing.
1.24 Survey means a map of a staked survey of the Real Property and Improvements prepared by the surveyor who prepared the existing survey for the shopping center identified on Exhibit 1.24 attached hereto (“Existing Survey”), such Survey to comply with the ALTA/ACSM Survey Requirements 2011 for ALTA/ACSM land title surveys jointly established and adopted in 2011, by the American Land Title Association, American Congress on Surveying and Mapping, and the National Society of Professional Surveyors, including optional items 1, 2, 3, 4, 6, 7, 8, 9, 10 and 11 of Table “A” thereof, which meets the accuracy standards (as adopted by ALTA and ACSM and in effect on the date of the Survey), or a state standard which is comparable to the foregoing ALTA/ACSM standard. The Survey shall be certified to Buyer, Seller, and the Title Company. The Existing Survey has been or will be delivered to Buyer within three (3) business days after the Effective Date.
1.25 Tenant Estoppel Letter means a letter or other certificate from a tenant certifying as to certain matters regarding such tenant’s Lease, in substantially the same form as Exhibit 1.25 of this Agreement, or in the case of national or regional “credit” tenants, the form customarily used by such tenant. In any case, the form of Tenant Estoppel Letter which the particular tenant is obligated to give under its lease shall be deemed acceptable, notwithstanding any other requirement of this Agreement.
1.26 Title Company means the Chicago national accounts office of First American Title Insurance Company.
1.27 Title Insurance means an ALTA 2006 form of owners’ policy of title insurance in the amount of the Purchase Price dated as of the date and time of Closing insuring marketable fee simple title to the Real Property in Buyer, subject only to the Permitted Exceptions, issued by the Title Company. Should Buyer require extended coverage and/or special endorsements to any policy, the cost of such endorsement(s) shall be borne by Buyer.
1.28 Title Insurance Commitment means a commitment for the Title Insurance whereby the Title Company agrees to issue the Title Insurance to Buyer, together with legible copies of all instruments which are exceptions noted therein or conditions to be satisfied.
2. PURCHASE PRICE AND PAYMENT
2.1 Purchase Price; Payment. The total Purchase Price for the Property (subject to adjustment as provided herein) shall be THIRTY ONE MILLION ONE HUNDRED THOUSAND AND 00/100 DOLLARS ($31,100,000.00). The Purchase Price shall be payable via wire transfer, before 4:00 P.M. on the date of Closing.
2.2 ▇▇▇▇▇▇▇ Money Deposit. An ▇▇▇▇▇▇▇ money deposit in the amount of five Hundred Thousand and 00/100 Dollars ($500,000.00) shall be deposited with Escrow Agent by Buyer within three (3) business days after the Effective Date. An additional ▇▇▇▇▇▇▇ money deposit in the amount of Five Hundred Thousand and 00/100 Dollars ($500,000.00) shall be deposited by Buyer with Escrow Agent within one (1) business day after the conclusion of the Inspection Period unless this Agreement is terminated in accordance with Article 3 hereof. This Agreement may be terminated by Seller by notice to Buyer if the said deposits are not delivered to Escrow Agent by such deadline(s). All deposits made as ▇▇▇▇▇▇▇ money, together with the earnings thereon, shall be deemed included within the meaning of the term ▇▇▇▇▇▇▇ Money Deposit for all purposes. The ▇▇▇▇▇▇▇ Money Deposit shall be held as specifically provided in this Agreement and shall be applied to the Purchase Price at Closing. After the conclusion of the Inspection Period, unless this Agreement has theretofore been terminated, the ▇▇▇▇▇▇▇ Money Deposit (increased as aforesaid) shall not be refundable except upon terms otherwise expressly set forth herein.
2.3 Tax Prorations. Ad valorem taxes and assessments shall be prorated at Closing as of 11:59 p.m. of the day preceding the Closing Date. If the amount of the taxes for the year of closing are not available on the Closing Date, taxes shall be prorated based upon the highest discounted rate for the immediately preceding calendar year. If applicable, Buyer shall pay the Closing year taxes on the date necessary to obtain the highest discounted rate available. Upon receipt of any actual tax ▇▇▇▇(s) for any period(s) subject to such tax proration, the Buyer and Seller shall reprorate all ad valorem taxes and assessments, whereupon Seller shall pay to Buyer or Buyer shall pay to Seller, as the case may be, all monies owed thereby.
2.4 Other Prorations. Other matters of income and expense, if any, and other items customarily prorated in transactions of this kind shall be prorated as of 11:59 p.m. of the day preceding the Closing Date. Seller shall cause all of the Contracts to be terminated, at its cost, as of Closing, subject to the provisions of Section 4.6 of this Agreement.
2.5 Further Adjustments to the Purchase Price. The Purchase Price shall be further adjusted by subtracting the amount of security deposits, prepaid rents from and credit balances of tenants under the Leases. The previous provisions to the contrary notwithstanding, any estimated overpayment or underpayment of CAM, Tax or Insurance charges by tenants for the year of closing shall be reconciled as of Closing pursuant to the information available at that time. A post Closing re-reconciliation shall occur in accordance with paragraph 2.6 below once all CAM, Tax or Insurance charges are known. Any rents, percentage rents or tenant reimbursements paid by tenants after the Closing Date to Buyer but applicable to
periods prior to the Closing Date shall first be applied to then due rental and reimbursement obligations under the respective Leases, with any remainder being remitted to Seller by Buyer within thirty (30) days after receipt to the extent of delinquencies owing under the applicable Leases as of Closing. During the 180 day period after Closing, Buyer shall send out Seller’s billing for any delinquencies existing as of Closing until the same are paid. Buyer shall have no obligation to pursue any other collection thereof and no obligation to institute any litigation. Seller may separately institute litigation for sums due it from tenants, but any such litigation shall not involve any attempt to evict any tenant. Buyer will not interfere in Seller’s efforts to collect sums due it prior to the Closing. Seller will remit to Buyer within five (5) days after receipt any rents, percentage rents or tenant reimbursements received by Seller after Closing which are attributable to periods occurring on or after the Closing Date. Rents not collected as of the Closing Date shall not be prorated at the time of Closing.
2.6 Post Closing Reconciliation: Seller shall provide to Buyer on or before March 31 of the year following the year of Closing (or earlier, to the extent required under any of the Leases) a final reconciliation of CAM, Tax and Insurance charges that accrued during Seller’s period of ownership, including an analysis of any sums due by each tenant to Seller. In the event there are sums due from Seller to tenants, Seller shall remit such payments to Buyer simultaneously with the final reconciliation, and the Buyer shall forward such payments to the respective tenants. Buyer agrees not to seek recovery of any CAM, Tax or Insurance charges from tenants, whether the same are due to Seller or Buyer, until after receipt of such reconciliation from Seller and further agrees that, after receipt of the reconciliation from Seller, Buyer, as the new landlord, shall request from each tenant, as applicable, payment of all such sums, including the sums due to Seller and Buyer, in a single request.
2.7 Closing Costs.
(a) | Seller shall pay: |
(1)The costs, if any, of satisfying any liens, curing title defects and recording any curative title documents;
(2)One-half (1/2) of the escrow fees or closing service fees, if any;
(3)Any and all transfer taxes and grantor taxes imposed upon the transactions contemplated hereby customarily paid by the Seller in the Commonwealth of Virginia; and
(4)The brokerage commission payable to Broker incurred in connection with the sale of the Property to Buyer, if and when this transaction closes, in accordance with a separate written agreement between Broker and Seller; and
(5)Seller’s attorneys’ fees relating to the sale of the Property.
(b)Buyer shall pay:
(1)The costs of Buyer’s due diligence investigations;
(2) | The costs of Title Insurance; |
(3)Any and all transfer taxes and grantee taxes imposed upon the transactions contemplated hereby customarily paid by the Buyer in the Commonwealth of Virginia;
(4)The costs of the Phase I environmental site assessment to be obtained by Buyer, if any;
(5)The costs of the new Survey;
(6)The costs of recording the closing documents to be recorded; and
(7)Buyer’s attorneys’ fees.
3. INSPECTION PERIOD AND CLOSING
3.1 Inspection Period. Within two (2) days after the Effective Date, Seller shall deliver or make available Buyer true, accurate, complete and legible copies of all of Seller’s Documents, to the extent in Seller’s possession. In addition, during the Inspection Period, Seller shall make available to Buyer, upon not less than 48 hours prior notice to Seller, all such other books, records, documents and other materials (however stored or maintained) relating to the Property as are maintained by Seller other than any of the same relating to the sale transaction contemplated hereby and which would otherwise be subject to attorney client privilege. Buyer shall have the Inspection Period within which to physically inspect the Property and conduct its due diligence related thereto and to review and analyze Seller’s Documents. Buyer and Buyer’s officers, employees, consultants, attorneys and other authorized representatives shall have the right to reasonable access to the Property and to all records of Seller related thereto (including without limitation title information, property leasing files, maintenance surveys, environmental assessment reports and other information concerning the condition of the Property), at reasonable times during the Inspection Period, for the purpose of inspecting the Property, taking soil and ground water samples, conducting Hazardous Materials inspections, tests and assessments, reviewing the books and records of Seller concerning the Property, evaluating the leasing and physical condition of the Property, conducting tenant interviews and otherwise conducting its due diligence review. The previous provision to the contrary notwithstanding, the Buyer shall give Seller two (2) days prior written notice (to be delivered via e-mail) prior to conducting any intrusive environmental testing or sampling on the Property, which notice shall be accompanied by a detailed description of the contemplated work and a map indicating the location of the testing. Such intrusive environmental testing shall be subject to the Seller’s prior written approval, which approval shall not be unreasonably withheld. In the event approved by Seller, such intrusive environmental testing shall be
conducted in such a way as to minimize interference with the business operations of the tenants of the shopping center and, unless requested by Seller in writing, the Buyer shall not provide the Seller with the results of such testing. Seller shall give Buyer any authorizations which may be required by Buyer in order to gain access to records or other information pertaining to the Property or the use thereof maintained by any third party, governmental or quasi-governmental authorities or organizations. Buyer hereby agrees to indemnify and hold Seller harmless from any damages, liabilities or claims for property damage or personal injury and mechanics liens caused by or arising from Buyer and its agents and contractors in the conduct of such inspections and investigations. Prior to any entry upon any Property by Buyer or any officer, employee, agent, consultant or contractor of Buyer, Buyer shall provide Seller with an insurance certificate reflecting commercial general liability insurance coverage of not less than $1,000,000.00, with excess liability coverage of not less than $2,000,000.00, and naming Seller as an additional insured. Buyer’s indemnity and insurance obligations shall survive the Closing or early termination hereof. Seller shall cooperate with and assist Buyer in making such inspections, interviews and reviews. Buyer agrees that it will not interview, converse or communicate with any tenant without affording Seller reasonable notice and an opportunity to be present and furnishing Seller a copy of each and every written communication to or from a tenant promptly upon giving or receiving same.
3.2 Buyer’s Termination Right; Buyer’s Notice of Satisfaction. Within the Inspection Period, Buyer may elect whether or not to go forward with the transaction contemplated by this Agreement to Closing, which election shall be made by notice to Seller given within the Inspection Period. If such notice is not timely given, this Agreement and all rights, duties and obligations of Buyer and Seller hereunder, except any which expressly survive termination such as Buyer’s indemnity and insurance obligations in Section 3.1, shall terminate, whereupon Escrow Agent shall promptly return to Buyer the ▇▇▇▇▇▇▇ Money Deposit. Buyer shall return to Seller the materials and information furnished to Buyer by Seller. If Buyer elects to go forward to Closing, the ▇▇▇▇▇▇▇ Money Deposit shall be increased by the additional deposit referred to in Section 2.2 of this Agreement (to be deposited with Escrow Agent no later than one (1) business day following the end of the Inspection Period). After the conclusion of the Inspection Period the ▇▇▇▇▇▇▇ Money Deposit (increased as aforesaid) shall not be refundable except upon terms otherwise expressly set forth herein.
3.3 Time and Place of Closing. The Closing shall take place at 10:00 A.M. on January 18, 2019 at or through the offices of Escrow Agent.
4. WARRANTIES, REPRESENTATIONS AND COVENANTS OF SELLER
Seller warrants and represents, and, where indicated, covenants and agrees, as follows:
4.1 Organization; Authority. Seller is duly organized, validly existing and in good standing under the laws of the state of its organization. Seller is authorized to transact business in the state in which the Real Property is located. Seller has full power and authority to enter into and perform this Agreement in accordance with its terms.
4.2 Title. Seller is the owner in fee simple of the Real Property.
4.3 Litigation. There is no litigation or proceeding pending, or to the best of Seller’s knowledge, threatened against Seller relating to the Property, except as set forth on Exhibit 4.3 attached hereto.
4.4 Leases. There are no Leases affecting the Real Property and Improvements other than those listed on the Rent Roll. The copies of the Leases, which will be made available to Buyer during the course of the Inspection Period, will be, to the best knowledge of Seller, true and correct copies thereof. From and after the Effective Date, Seller will not terminate or modify any of the Leases, enter into any new Leases or grant additional renewal rights to any tenant, without the consent of Buyer, which consent shall not be unreasonably withheld or delayed prior to the expiration of the Inspection Period, and which consent may be granted or denied in Buyer’s sole discretion thereafter. During the Inspection Period Seller will advise Buyer of the terms of any proposed new Lease or material modification of any existing Lease, or of any termination. No rent or reimbursement has been paid more than one (1) month in advance. No security deposit has been paid, except as stated on a separate certified report from Seller. No tenants under the Leases are entitled to interest on any security deposits.
4.5 Financial Statements. Each of the Seller Financial Statements delivered or to be delivered to Buyer hereunder has or will have been prepared in accordance with generally accepted accounting principles consistently applied and are true, accurate and complete in all material respects.
4.6 Contracts. Except as stated on Exhibit 4.6 attached hereto, which is a list of all service contracts in force and effect as of the date hereof, there are no Contracts affecting the Real Property. To the best of Seller’s knowledge, all Contracts are in full force and effect, and all obligations of Seller under the Contracts required to be performed to date have been performed in all material respects; no party to any Contract has asserted any claim of default or offset against Seller with respect thereto and no event has occurred or failed to occur, which would in any way affect the validity or enforceability of any such Contract. To the best of Seller’s knowledge, the copies of the Contracts to be delivered to Buyer will be true, correct and complete copies thereof. On or prior to Closing, Seller shall terminate, at its cost, all of the Contracts and Buyer shall not assume any of the same.
4.7 Maintenance and Operation of Property. From and after the date hereof and until the Closing, Seller covenants to keep and maintain and operate the Property substantially in the manner in which it is currently being maintained and operated and covenants not to cause or permit any waste nor undertake any action with respect to the operation thereof outside the ordinary course of business without Buyer’s prior written consent, not to be unreasonably withheld. Seller covenants not to remove from the Improvements or the Real Property any article included in the Personal Property, without replacing the same with a replacement of the same general quality and/or type. Seller covenants to maintain such casualty and liability insurance on the Property as is presently being maintained.
4.8 Rent Roll; Tenant Estoppel Letters.
(a) The Rent Roll is true and correct in all material respects.
(b) After December 5, 2018, Seller shall use commercially reasonable efforts to obtain Tenant Estoppel Letters from all Tenants under the Leases, the same to be dated not earlier than 45 days prior to Closing. Unless otherwise approved by Buyer in writing, Seller shall not request any Tenant Estoppel Letters until after the expiration of the Inspection Period. Seller and Buyer shall cooperate with one another regarding the preparation and delivery of the Tenant Estoppel Letters to the tenants (e.g., prior to delivery of any Tenant Estoppel to a tenant, Seller shall provide copies thereof to Buyer for its review and approval). Seller shall deliver each Tenant Estoppel Letter as executed by the applicable tenant as and when received by Seller rather than waiting to deliver all of such Tenant Estoppels en masse.
4.9 Condemnation. To the best knowledge of Seller, neither the whole nor any portion of the Real Property, including access thereto, is subject to temporary requisition of use by any governmental authority or has been condemned, or taken in any proceeding similar to a condemnation proceeding, nor is there now pending or formally threatened any condemnation, expropriation, requisition or similar proceeding against the Property or any portion thereof. Seller has received no notice nor has any other knowledge that any such proceeding is contemplated.
4.10 Consents and Approvals; No Violation. Neither the execution and delivery of this Agreement by Seller nor the consummation by Seller of the transactions contemplated hereby will (a) conflict with or breach any provision of the organizational documents of Seller; (b) violate or breach any provision of, or constitute a default (or an event which, with notice or lapse of time or both, would constitute a default) under, any note, bond, mortgage, indenture or deed of trust to which Seller is a party; or (c) violate any order, writ, injunction, decree, judgment, statute, law or ruling of any court or governmental authority applicable to Seller.
4.11 Environmental Matters. To the best of Seller’s knowledge, neither Seller nor any third party has used Hazardous Material at the Real Property except as may be reflected by the environmental assessment report to be delivered to Buyer as part of Buyer’s due diligence, or as otherwise set forth on Exhibit 4.11 attached hereto.
4.12 Foreign Investment and Real Property Tax Act. Seller is not a “foreign person” within the meaning of Section 1445 of the Internal Revenue Code, or under any comparable state statutes which are applicable to this transaction. At Closing Seller will execute and deliver to Buyer an affidavit regarding such matters.
4.13 Seller’s Knowledge. When used herein, the term “to the best of Seller’s knowledge” or “to the best of knowledge of Seller” shall mean only the actual, current, conscious knowledge, without inquiry (not constructive or implied knowledge) of Seller’s representative, ▇▇▇▇▇ ▇▇▇▇▇▇▇
4.14 Tenant Improvements and Commissions. Except as set forth on Exhibit 4.14, there are no tenant improvement allowances, tenant improvement costs or brokerage fees or leasing commissions (collectively, “Leasing Costs”) payable for the current term of any of the Leases. All Leasing Costs with respect to the current term of each existing Lease have either been paid in full, or will be paid in full by Seller (i) to the extent due and payable, prior to Closing or through the Closing escrow, or (ii) in the event such
amounts are not due and payable, such amounts shall be credited to the Buyer at Closing and following Closing, Buyer shall thereupon be responsible for the payment thereof, and Seller shall be released from all liability and other obligations with respect to, such Leasing Costs to the extent of such credit. Buyer shall be responsible and shall pay for the Leasing Costs relating to or arising from (i) the exercise by any tenant, after the Effective Date, of a renewal, expansion or extension option contained in any of the Leases executed on or before the Effective Date, and (ii) any new Leases or any amendments of existing Leases entered into after the Effective Date in accordance with the terms of Section 4.4.
4.15 Employees. Seller has no employees at the Property and is not a party to any collective bargaining agreement, and neither Seller nor any of its affiliates (as described in Section 414(b), (c) and (m) of the Internal Revenue Code) has incurred any liability which could subject Buyer or any asset to be acquired by Buyer pursuant to this Agreement to any lien or material liability under Sections 302(f), 4062, 4063, 4064, 4201 or 4301(b) of the Employee Retirement Income Security Act of 1974, as amended, or Section 401(a) (29) or 412 of the Internal Revenue Code.
4.16 Major Tenants. No Major Tenant has ceased operation from its premises within the Property, terminated its Lease, filed for bankruptcy protection, or publicly announced that it shall be so ceasing operations, terminating its Lease or filing for such bankruptcy protection (collectively, a “Major Tenant Adverse Event”). To the extent of such a Major Tenant Adverse Event during the term of this Agreement prior to Closing, Seller shall promptly inform Buyer of the same. Seller’s failure to provide such notice shall be deemed a breach of the foregoing representations and warranties and a default under this Agreement. In the event of a Major Tenant Adverse Event, it shall not be deemed an event of default by Seller, however Buyer shall have the right, upon notice thereof to Seller on or prior to Closing, to terminate this Agreement and thereupon to receive an immediate refund of the ▇▇▇▇▇▇▇ Money Deposit and neither party shall thereafter have any further liability or obligation hereunder except for such liabilities and obligations that are expressly stated herein to survive termination of this Agreement.
4.17 Patriot Act. Neither Seller nor any person, group, entity or nation that Seller is acting, directly or indirectly for, or on behalf of, is named by any Executive Order (including the September 24, 2001, Executive Order Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism) or the United States Treasury Department as a terrorist, “Specially Designated National and Blocked Person,” or is otherwise a banned or blocked person, group, entity, or nation pursuant to any Law that is enforced or administered by the Office of Foreign Assets Control, and Seller is not engaging in the transaction contemplated hereby, directly or indirectly, on behalf of, or instigating or facilitating the same, directly or indirectly, on behalf of, any such person, group, entity or nation. Seller is not engaging in such transaction, directly or indirectly, in violation of any Laws relating to drug trafficking, money laundering or predicate crimes to money laundering. The investment of direct or indirect equity owners in Seller is not prohibited by applicable law and neither the transaction contemplated hereby nor this Agreement is or will be in violation of applicable law. Seller has and will continue to implement procedures, and has consistently and will continue consistently to apply those procedures, to ensure the foregoing representations and warranties remain true and correct at all times prior to Closing.
5. WARRANTIES AND REPRESENTATIONS OF BUYER
Buyer warrants and represents, and, where indicated, covenants and agrees, as follows:
5.1 Buyer hereby warrants and represents that Buyer is an entity which is duly organized, validly existing and in good standing under the laws of the state of its organization. Buyer is and will be authorized to transact business in the state in which the Real Property is located. Buyer has full power and authority to enter into and perform this Agreement in accordance with its terms.
5.2 USA Patriot Act.
(a)None of the funds to be used for payment by Buyer of the Purchase Price will be subject to 18 U.S.C. §§ 1956-1957 (Laundering of Money Instruments), 18 U.S.C. §§ 981-986 (Federal Asset Forfeiture), 18 U.S.C. §§ 881 (Drug Property Seizure), Executive Order Number 13224 on Terrorism Financing, effective September 24, 2001, or the United and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, H.R. 3162, Public Law 107-56 (the “US Patriot Act”).
(b)Buyer is not a person or entity with whom U.S. persons are restricted from doing business with under the regulations of the Office of Foreign Asset Control (“OFAC”) of the Department of Treasury (including those named on OFAC’s Specially Designed and Blocked Persons list) or under any statute, executive order (including the September 24, 2001 Executive Order Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism), the USA Patriot Act, or other governmental action.
5.3 Disclaimer. BUYER ACKNOWLEDGES AND AGREES THAT, EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT OR IN THE CLOSING DOCUMENTS, SELLER HAS NOT MADE, AND SPECIFICALLY NEGATES AND DISCLAIMS, ANY REPRESENTATIONS, WARRANTIES, COVENANTS OR AGREEMENTS OF ANY KIND OR CHARACTER REGARDING ANY ASPECT OF THE PROPERTY, INCLUDING, WITHOUT LIMITATION: (A) THE VALUE, NATURE, QUALITY OR PHYSICAL CONDITION THEREOF, (B) THE INCOME TO BE DERIVED THEREFROM, (C) THE SUITABILITY OF THE PROPERTY FOR ANY ACTIVITY OR USE WHICH BUYER OR ANY TENANT MAY CONDUCT THEREON, (D) THE COMPLIANCE OF THE PROPERTY OR ITS OPERATION WITH ANY LAWS, RULES, ORDINANCES OR REGULATIONS OF ANY APPLICABLE GOVERNMENTAL AUTHORITY OR BODY, (E) THE HABITABILITY, MERCHANTABILITY, MARKETABILITY, PROFITABILITY OR FITNESS FOR A PARTICULAR PURPOSE OF THE PROPERTY, (F) THE MANNER, QUALITY, STATE OF REPAIR OR LACK OF REPAIR OF THE PROPERTY, OR (G) COMPLIANCE OF THE PROPERTY WITH ANY ENVIRONMENTAL PROTECTION, POLLUTION OR LAND USE LAWS, RULES, REGULATIONS, ORDERS OR REQUIREMENTS, INCLUDING THE EXISTENCE THEREIN, THEREON OR THEREUNDER OF HAZARDOUS MATERIALS. ADDITIONALLY, EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT OR IN THE CLOSING DOCUMENTS, NO PERSON ACTING ON BEHALF OF SELLER IS AUTHORIZED TO MAKE, AND BY EXECUTION HEREOF BUYER ACKNOWLEDGES THAT NO PERSON HAS MADE, ANY REPRESENTATION, WARRANTY, COVENANT OR AGREEMENT REGARDING THE PROPERTY OR THE TRANSACTIONS CONTEMPLATED HEREIN. BUYER ACKNOWLEDGES THAT, HAVING BEEN GIVEN THE OPPORTUNITY TO INSPECT THE PROPERTY, BUYER IS RELYING SOLELY ON ITS OWN INVESTIGATIONS AND NOT ON ANY INFORMATION PROVIDED OR TO BE PROVIDED BY SELLER, OTHER THAN INFORMATION EXPRESSLY REQUIRED TO BE
PROVIDED BY SELLER HEREUNDER. BUYER FURTHER ACKNOWLEDGES AND AGREES THAT TO THE MAXIMUM EXTENT PERMITTED BY LAW THE SALE PROVIDED FOR HEREIN ARE MADE ON AN “AS-IS, WHERE-IS” BASIS WITH ALL FAULTS. FURTHERMORE, EXCEPT FOR ANY CLAIM THE BUYER MAY HAVE AS A RESULT OF THE BREACH BY THE SELLER OF ANY EXPRESS REPRESENTATION OR WARRANTY OF SELLER SET FORTH HEREIN OR IN THE CLOSING DOCUMENTS, BUYER DOES HEREBY RELEASE AND FOREVER DISCHARGE SELLER, ITS DIRECTORS, SHAREHOLDERS, OFFICERS, EMPLOYEES, LEGAL REPRESENTATIVES, AGENTS AND ASSIGNS, FROM ANY AND ALL ACTIONS, CAUSES OF ACTION, CLAIMS AND DEMANDS FOR, UPON OR BY REASON OF ANY DAMAGE, LOSS OR INJURY WHICH HERETOFORE HAVE BEEN OR WHICH HEREAFTER MAY BE SUSTAINED BY BUYER RESULTING FROM OR ARISING OUT OF THE PRESENCE OF ANY HAZARDOUS MATERIALS OR OTHER ENVIRONMENTAL CONTAMINATION ON OR IN THE VICINITY OF THE PROPERTY, INCLUDING THE SOIL AND/OR GROUNDWATER (HEREINAFTER REFERRED TO AS THE “CLAIMS”). THIS RELEASE APPLIES TO ALL SUCH CLAIMS WHETHER THE ACTIONS CAUSING THE PRESENCE OF HAZARDOUS MATERIALS ON OR IN THE VICINITY OF THE PROPERTY OCCURRED BEFORE OR AFTER THE CLOSING. THIS RELEASE EXTENDS AND APPLIES TO, AND ALSO COVERS AND INCLUDES, ALL STATUTORY OR COMMON LAW CLAIMS THE BUYER MAY HAVE AGAINST THE SELLER. THE PROVISIONS OF ANY STATE, FEDERAL, OR LOCAL LAW OR STATUTE PROVIDING IN SUBSTANCE THAT RELEASES SHALL NOT EXTEND TO CLAIMS, DEMANDS, INJURIES OR DAMAGES WHICH ARE UNKNOWN OR UNSUSPECTED TO EXIST AT THE TIME, TO THE PERSON EXECUTING SUCH RELEASE, ARE HEREBY EXPRESSLY WAIVED. THE PROVISIONS OF THIS SECTION SHALL SURVIVE THE CLOSING OR ANY TERMINATION OF THIS AGREEMENT.
6. POSSESSION; RISK OF LOSS
6.1 Possession. Possession of the Property will be transferred to Buyer at the conclusion of the Closing, subject to the Permitted Exceptions.
6.2 Risk of Loss. All risk of loss to the Real Property and Improvements shall remain upon Seller until the conclusion of the Closing. If, before Closing, any material and substantial portion of the Real Property and/or Improvements is damaged by fire or other casualty, or if any material and substantial portion of the Real Property and/or Improvements is taken or formally threatened by eminent domain, Seller shall, within ten (10) days of such damage or taking, notify Buyer thereof and Buyer shall have the option to:
(a)terminate this Agreement upon notice to Seller given within ten (10) business days after such notice from Seller; or
(b)proceed with the purchase of the Property, in which event Seller shall assign to Buyer all Seller’s right, title and interest in all amounts due or collected by Seller under any insurance policies or as condemnation awards and, in the case of insurance, Buyer shall receive a credit Closing in the amount of any deductible and/or self insured retention.
For purposes of this Section 6.2, “material and substantial”, (i) with respect to a casualty, means damage to the Real Property and/or Improvements of such nature that the cost of restoring the same to its condition prior to the casualty would exceed $500,000.00; and (ii) with respect to condemnation, means a taking which would prevent or materially impair Buyer from using the Property for the use intended and/or which affects in any material adverse way vehicular access to the Real Property. If less than a material and substantial portion of the Real Property and/or Improvements is damaged by fire or other casualty or taken or formally threatened by eminent domain, then Buyer shall have no rights to terminate the Agreement under this Section 6.2; provided, however, at Closing, Seller shall assign to Buyer all Seller’s right, title and interest in all amounts due or collected by Seller under any insurance policies or as condemnation awards.
7. | TITLE MATTERS |
Seller has previously delivered to Buyer copies of the Existing Title Policy and Existing Survey. Seller shall order the new Title Insurance Commitment within three (3) business days after the Effective Date. Within three (3) business days after receipt of the Title Insurance Commitment, Buyer shall order a new Survey. Buyer will have 10 business days after its receipt of both the new Title Insurance Commitment and the new Survey, but in no event beyond the end of the Inspection Period, within which to notify Seller in writing of any conditions, defects, encroachments or other objections to title or survey which are not acceptable to Buyer in its sole discretion. Any matter disclosed by the Title Insurance Commitment other than liens arising through Seller which are removable by the payment of money, for which Seller shall be obligated to cure, or by the new Survey which is not timely specified in Buyer’s written notice to Seller, shall be deemed a Permitted Exception. Seller shall have a period of five (5) business days after receipt of Buyer’s title objection letter in which to elect to cure such title objections, provided however that Seller shall not be obligated to cure or institute any litigation with respect thereto (other than liens arising through Seller). If Seller elects to cure such title objections, Seller shall use reasonable efforts to cure such objections to title or survey by Closing. If Seller elects not to cure such title objection(s), within five (5) days after Seller’s response, Buyer shall elect to (i) refuse to purchase the Property and terminate this Agreement and receive a return of the ▇▇▇▇▇▇▇ Money Deposit; or (ii) waive such objection(s) and, subject to the terms and conditions hereof, close the purchase of the Property, subject to the objection(s), and without reduction of the Purchase Price. In the event Buyer fails to deliver notice of its election to Seller, Buyer shall be deemed to have elected to waive such objection(s) and close the purchase of the Property.
8. | CLOSING DELIVERIES |
8.1 Seller Deliveries. At Closing Seller shall deliver:
(a)A limited warranty deed (“Warranty Deed”) from Seller in the form attached hereto as Exhibit 8.1(a);
(b)If requested by Buyer, a quit claim deed (“Quit Claim Deed”) in the form attached hereto as Exhibit 8.1(b) conveying the Real Property to Buyer pursuant to the legal description set forth on the Survey;
(c)Originals, if available, or if not, true copies of the Leases and Contracts;
(d)An Assignment and Assumption of Leases from Seller in the form attached hereto as Exhibit 8.1(d) (the “Assignment of Leases”);
(e)A quitclaim ▇▇▇▇ of sale or assignment of all Personal Property from Seller in the form attached hereto as Exhibit 8.1(e);
(f)An updated Rent Roll certified by Seller;
(g)Tenant Estoppel Letters obtained by Seller, if not already delivered to Buyer, which must include those from all Major Tenants and seventy five percent (75%) by number of the other tenants who have signed Leases for the Property. In the event that one or more of the required Tenant Estoppel Letters for any of the tenants other than the Major Tenants is not delivered at least three (3) business days prior to Closing, the Seller shall have the right, in fulfillment of this condition, to deliver a Landlord Estoppel Letter in the form attached hereto as Exhibit 8.1(g) (“Landlord Estoppel Letter”). If Seller delivers a Landlord Estoppel Letter for any tenant and within ninety (90) days thereafter delivers a Tenant Estoppel Letter from such tenant in form required herein and containing the same provisions as are included in the Landlord Estoppel Letter, Seller will be released from any and all liabilities and obligations thereafter accruing under such Landlord Estoppel Letter. In the event Seller shall be unable to deliver a Tenant Estoppel Letter for any one or more of the Major Tenants, any Tenant Estoppel letter indicates any valid claim of default by Seller, as landlord, under the respective lease which is not cured on or before the Closing Date and/or any Tenant Estoppel Letter materially conflicts with the terms of the respective lease, then, Buyer shall have the right, upon notice thereof to Seller, to terminate this Agreement, in which event, the ▇▇▇▇▇▇▇ Money Deposit shall be returned to the Buyer and the parties shall have no further rights or obligations under this Agreement (except those indemnity and insurance obligations that specifically survive termination). In the event that Buyer shall not reject and any Tenant Estoppel so executed by the applicable tenant within seven (7) days after receipt thereof from Seller, the same shall be deemed accepted by Buyer;
(h)An owner’s affidavit in the form attached hereto as Exhibit 8.1(h);
(i)Resolutions or affidavits of Seller authorizing the transaction described herein;
(j)All keys and other means of access to the Improvements in the possession of Seller or its agents, or if the Improvements are accessed by a master key, Buyer shall be responsible for re-keying such Improvements;
(k)Letters to tenants signed by Seller notifying the tenants of the acquisition of the Property by Buyer and directing the tenants to pay all rents and other sums to Buyer from and after the Closing Date; and
(l)Such other documents as the Title Company may reasonably request to effect the transaction contemplated by this Agreement.
8.2 Buyer Deliveries. At Closing Buyer shall deliver:
(m)A direction to Escrow Agent to disburse the ▇▇▇▇▇▇▇ Money Deposit to Seller;
(n)The balance of the Purchase Price;
(o)The Assignment of Leases described in Subsection 8.1(c) above;
(p)Resolutions or affidavits of Buyer authorizing the transactions described herein;
(q)Joinder(s) by Buyer in the letters to tenants required of Seller in Section 8.1(m) above; and
(r)Such other documents as the Title Company may reasonably request to effect the transactions contemplated by this Agreement.
8.3 Reasonable Efforts. Each of the parties hereto agrees to use reasonable efforts to take or cause to be taken all actions reasonably necessary, proper or advisable to consummate the transactions contemplated by this Agreement.
9. BREACH; REMEDIES
9.1 Breach by Seller. In the event of a breach of Seller’s obligations herein, Buyer may, at Buyer’s election: (i) terminate this Agreement and receive a return of the ▇▇▇▇▇▇▇ Money Deposit, and the parties shall have no further rights or obligations under this Agreement (except as expressly survive termination); (ii) enforce this Agreement by suit for specific performance; or (iii) waive such breach and close the purchase contemplated hereby, notwithstanding such breach. In the event that specific performance shall not be available to Buyer due to the Seller’s intentional conveyance of the Property or a portion thereof to a bona fide third party for value in violation of the terms and conditions hereof, then, Buyer shall be entitled to damages in an amount equal to all third party out of pocket costs and expenses incurred by Buyer in connection with the transaction contemplated hereby, but not in excess of $100,000 in any event.
9.2 Pre-Closing Breach by Buyer. In the event of a breach of Buyer’s obligations herein, Seller’s sole legal and equitable remedy (except for breaches related to Buyer’s indemnity and insurance obligations) shall be to terminate this Agreement and retain Buyer’s ▇▇▇▇▇▇▇ Money Deposit as AGREED LIQUIDATED DAMAGES for such breach, and upon payment in full to Seller of such ▇▇▇▇▇▇▇ Money Deposit, the parties shall have no further rights, claims, liabilities or obligations under this Agreement (except the indemnity and
insurance obligations of Buyer, for which Seller, in the event of a breach thereof by Buyer, shall have available to it all remedies at law or in equity).
9.3 Post-Closing Breach by Seller. In the event of a breach of Seller’s obligations herein that occurs after Closing, Buyer’s remedies shall be governed by Section 10.13 below, as Buyer’s sole and exclusive remedy.
9.4 Post-Closing Breach by Buyer. In the event of a breach of Buyer’s obligations herein that occurs after Closing, Seller shall have any and all remedies available at law and in equity.
10. MISCELLANEOUS
10.1 Tax Appeals.
(a) | If any tax reduction proceedings in respect of the Property, (i) relating to any fiscal years ending prior to the fiscal year in which the Closing occurs or (ii) relating to the fiscal year in which the Closing occurs, are pending at the time of Closing, then until the date which is two (2) years after the Closing Date (the “Tax Proceedings Cutoff Date”) the Seller reserves and shall have the right to continue to prosecute and/or settle the same, subject to Buyer’s reasonable approval and ability to participate; provided, however, that Seller shall not settle any such proceeding that relates to the taxable year during which the Closing occurs or which could reasonably be expected to increase any tax liability with respect to the Property in a taxable period (or portion thereof) following the Closing Date without Buyer’s prior written consent, which consent shall not be unreasonably withheld, conditioned or delayed. Buyer shall reasonably cooperate with Seller in connection with the prosecution of any such tax reduction proceedings. From and after the Tax Proceedings Cutoff Date, Buyer shall have the sole right to continue and prosecute and/or settle any tax reduction proceedings in respect of the Property. |
(b) | Any refunds or savings (including credits) in the payment of real property taxes (whether or not resulting from such tax reduction proceedings) applicable to taxes payable during the period (or portion thereof) prior to the date of the Closing shall belong to and be the property of Seller, and any refunds or savings in the payment of taxes applicable to taxes payable from and after the date of the Closing shall belong to and be the property of Buyer; provided, however, that if any refund received by the Seller pursuant to this Section 10.1 creates an obligation to reimburse any Tenants under Leases for any rents or additional rents paid or to be paid, that portion of such refund equal to the amount of such required reimbursement (after deduction of allocable expenses as may be provided in the Lease to such Tenant) shall be paid by Seller directly to the Tenants entitled thereto. All attorneys’ fees and other expenses incurred in obtaining such refunds or savings shall be apportioned between Seller and Buyer in proportion to the gross amount of such refunds or savings payable to Seller and Buyer, respectively (without regard to any amounts reimbursable to Tenants); |
provided, however, that neither Seller nor Buyer shall have any liability for any such fees or expenses in excess of the refund or savings paid to such party unless such party initiated such proceeding. All amounts payable to Buyer shall be paid by Seller within ten (10) business days after receipt by Seller or its successors or assigns of such refund or savings. All amounts payable to Seller shall be paid by Buyer within ten (10) business days after receipt by Buyer or its successors or assigns of such refund or savings.
10.2 Commissions. Seller and Buyer represent to each other that neither Seller (in the case of Seller’s representation) nor Buyer (in the case of Buyer’s representation) has dealt with nor does it have any knowledge of any broker or other person who has or may have any claim against Seller, Buyer or the Property for a brokerage commission, finder’s fee or like payment arising out of or in connection with this transaction, other than Broker. Buyer agrees to indemnify and hold Seller harmless from any other such claim arising by, through or under Buyer, and Seller agrees to indemnify and hold Buyer harmless from any other such claim arising by, through or under Seller. Seller shall be solely responsible for and shall pay Broker a commission in the event of and at Closing pursuant to a separate written agreement between Seller and Broker.
10.3 Notices. All notices and demands of any kind which either party may be required or may desire to serve upon the other party in connection with this Agreement shall be in writing, signed by the party or its counsel identified below, and shall be served (as an alternative to personal service) by registered or certified mail, overnight courier service or facsimile transmission or e-mail (followed promptly by personal service or mailing of a hard copy), at the addresses set forth below:
As to Seller: | Regency Realty Group, Inc. Attention: ▇▇▇▇▇ Argalas One Independent Drive, Suite 114 Jacksonville, FL 32202-5019 Telephone: Email: |
With a copy to Seller’s Counsel | ▇▇▇▇ & ▇▇▇▇▇▇, LLP Attention: ▇▇▇▇▇▇▇ ▇. May, Esq. ▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ 32202 Telephone: Email: |
As to Buyer: | The ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Group LLC Attention: ▇▇▇▇▇▇▇ ▇▇▇▇ and ▇▇▇▇▇ Wik 11501 Northlake Drive Cincinnati, Ohio 45249 Telephone: Facsimile: E-mail: |
With a copy to Buyer’s Counsel: | ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇▇▇▇, LP Attention: J. Adam ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ 48304 Telephone: Facsimile: E-mail: |
With a copy to Escrow Agent: (if required) | First American Title Insurance Company Attention: ▇▇▇▇▇ McIntosh30 North LaSalle Street, Suite 2700 Chicago, Illinois 60602 Telephone: Facsimile: Email: |
Any such notice or demand so secured, shall constitute proper notice hereunder upon posting to the United States Postal Service, a nationally recognized overnight courier, or upon facsimile or e-mail transmission provided that a copy thereof is forward via one of the other methods of delivery referred to above.
10.4 Headings. The titles and headings of the various sections hereof are intended solely for means of reference and are not intended for any purpose whatsoever to modify, explain or place any construction on any of the provisions of this Agreement.
10.5 Validity. If any of the provisions of this Agreement or the application thereof to any persons or circumstances shall, to any extent, be invalid or unenforceable, the remainder of this Agreement shall not be affected thereby, and every other provision of this Agreement shall be valid and enforceable to the fullest extent permitted by law.
10.6 Attorneys’ Fees. In the event of any dispute, litigation or other proceeding between the parties hereto to enforce any of the provisions of this Agreement or any right of either party hereunder, the unsuccessful party to such dispute, litigation or other proceeding shall pay to the successful party all costs and expenses, including reasonable attorneys’ fees, incurred at trial, on appeal, and in any arbitration,
administrative or other proceedings, all of which may be included in and as a part of the judgment rendered in such litigation. Any indemnity provisions herein shall include indemnification for such costs and fees. This section shall survive the Closing or a prior termination hereof.
10.7 Time. Time is of the essence of this Agreement, provided that if any date upon which some action, notice or response is required of any party hereunder occurs on a weekend or national holiday, such action, notice or response shall not be required until the next succeeding business day.
10.8 Governing Law. This Agreement shall be governed by the laws of the state in which the Real Property is located.
10.9 Gender; Plural; Singular; Terms. A reference in this Agreement to any gender, masculine, feminine or neuter, shall be deemed a reference to the other, and the singular shall be deemed to include the plural and vice versa, unless the context otherwise requires. The terms “herein,” “hereof,” “hereunder,” and other words of a similar nature mean and refer to this Agreement as a whole and not merely to the specified section or clause in which the respective word appears unless expressly so stated.
10.10 Exhibits. All exhibits attached hereto are incorporated herein by reference to the same extent as though such exhibits were included in the body of this Agreement verbatim.
10.11 Counterparts, Further Instruments, Etc. This Agreement may be executed in counterparts, and when so executed shall be deemed executed as one agreement. Seller and Buyer shall execute any and all documents and perform any and all acts reasonably necessary to fully implement this Agreement.
10.12 No Recording. Neither this Agreement nor any memorandum notice or short form hereof shall be recorded.
10.13 Survival of Seller’s Representations and Warranties. The representations and warranties of Seller set forth in this Agreement, including, without limitation, Article 4 hereof, shall survive the Closing for a period of nine (9) months following the Closing Date (the “Survival Period”), at which time they will be of no further force or effect except as hereinafter provided in this Section 10.13. No claim asserted after Closing for a breach of any representation or warranty of Seller shall be actionable or payable if the breach in question results from or is based on a condition, state of facts or other matter which was known to Buyer prior to Closing or disclosed or referenced in this Agreement, the documents delivered as part of the due diligence documentation, the Existing Title Policy, Existing Survey, Title Insurance Commitment or the Survey. Seller shall not have any liability to Buyer for a breach of any representation or warranty (a) unless the valid claims for all breaches with respect to the Property collectively aggregate more than $10,000.00 (“Minimum Amount”), in which event only the amount of such valid claims in excess of the Minimum Amount shall be actionable, up to the Cap (as defined in this Section 10.13), and (b) unless written notice containing a description of the specific nature of such breach shall have been given by Buyer to Seller prior to the expiration of the Survival Period and an action shall have been commenced and filed by Buyer against Seller within sixty (60) days after delivery of notice of the alleged breach. As used herein, the term “Cap” shall mean Six Hundred Fifty Thousand Dollars ($650,000.00) in the aggregate. In no event whatsoever
shall Seller have any liability to Buyer in excess of the Cap for any claims asserted after Closing for a breach; provided however, notwithstanding the foregoing, neither the Cap nor the Minimum Amount shall be applicable with respect to a breach of Seller’s Obligation under Section 10.2 above.
10.14 Successors and Assigns. Buyer shall not assign its rights hereunder except to affiliated entities. An affiliated entity for purposes hereof shall include any entity which is wholly owned by a party or by a parent of a party, or any entity in which a party or a parent of a party has an equity interest and is a general or managing partner/member. The terms and provisions of this Agreement shall be binding upon and shall inure to the benefit of the heirs, successors and permitted assigns of the parties. No third parties, including any brokers or creditors, shall be beneficiaries hereof or entitled to any rights or benefits hereunder.
10.15 Entire Agreement. This Agreement, together with the exhibits attached hereto, supersedes all prior agreements between the parties as to the Property, if any, and constitutes the entire agreement between the parties with respect to the subject matter hereof. This Agreement may not be modified, amended or otherwise changed in any manner except by a writing executed by Buyer and Seller or their respective counsel identified herein.
10.16 Facsimile or .pdf. Signatures to this Agreement transmitted by telecopy or email (.pdf) shall be valid and effective to bind the party so signing. Each party agrees to promptly deliver an execution original to this Agreement with its actual signature to the other party, but a failure to do so shall not affect the enforceability of this Agreement, it being expressly agreed that each party to this Agreement shall be bound by its own telecopied or emailed signature and shall accept the telecopied or emailed signature of the other party to this Agreement.
10.17 1031 Exchange. Buyer acknowledges that Seller may effect a like-kind exchange under Section 1031 of the Internal Revenue Code of 1986, as amended (the “Code”). Accordingly, Buyer agrees that it will cooperate with Seller to effect a tax-free exchange in accordance with the provisions of Section 1031 of the Code and the regulations promulgated with respect thereto. Seller shall be solely responsible for any additional fees, costs or expenses incurred in connection with the like-kind exchange contemplated by this paragraph, and Buyer shall not be required to incur any debt, obligation or expense in accommodating Seller hereunder. In no event shall Seller’s ability or inability to effect a like-kind exchange, as contemplated hereby, in any way delay the Closing or relieve Seller from its obligations and liabilities under this Agreement. Seller hereby agrees to indemnify and hold harmless Buyer from any liability, losses or damages incurred by Buyer in connection with or arising out of the Section 1031 like-kind exchange, including but not limited to any tax liability.
10.18 Purchase of Property Only. The parties acknowledge that the purchase and sale of the Property involves only the purchase and sale of the Property and that Seller is not selling a business nor do the parties intend that Buyer be deemed a successor of Seller with respect to any debts, liabilities and obligations of Seller other than the tenants under the Leases, any Contracts assumed by Buyer and any obligations and liabilities as owner of the Property. Seller shall be liable for all payments and benefits to past and/or present employees of Seller in connection with the business being conducted on or from the Property as may have accrued through Closing (including, but not limited to, salaries, wages, commissions, bonuses, vacation pay, health and welfare contributions, pensions, profit sharing, severance or termination pay, or any other form of compensation or fringe benefit).
10.19 Escrow Agent. The terms and conditions set forth in this Agreement shall constitute both an agreement between Seller and Buyer and instructions for Escrow Agent, which Escrow Agent shall acknowledge and agree to be bound by, as evidenced by its execution of this Agreement. Seller and Buyer shall promptly execute and deliver to Escrow Agent any separate or additional escrow instructions requested by Escrow Agent which are consistent with the terms of this Agreement. Any separate or additional instructions shall not modify or amend the provisions of this Agreement unless otherwise expressly agreed by mutual consent of Buyer and Seller. Buyer and Seller both hereby acknowledge and agree that Escrow Agent shall hold and deliver the ▇▇▇▇▇▇▇ Money Deposit and all other deposits which may be made under this Agreement in accordance with the terms and conditions of this Agreement and that Escrow Agent shall be relieved of all liability and held harmless by both Seller and Buyer in the event Escrow Agent makes any disbursement of such monies in accordance with the terms and provisions of this Agreement. Escrow Agent shall be relieved from any responsibility or liability and held harmless by both Buyer and Seller in connection with the discharge of Escrow Agent’s duties hereunder provided that Escrow Agent exercises ordinary and reasonable care in the discharge of such duties.
By their execution and delivery of this Agreement, the Buyer and Seller acknowledge and confirm that under certain circumstances deposits (including the funds subject to this Agreement) may not be insured or fully insured by the Federal Deposit Insurance Corporation (“FDIC”). Each party has made its own analysis of FDIC insurance regulations affecting, or potentially affecting, the funds subject to this Agreement and is not relying upon any advice from the Escrow Agent as to FDIC matters. The Buyer and Seller understand and agree that Escrow Agent is holding the escrow funds as agent and that the funds are not trust funds. Simultaneously with final disbursement of the escrow funds pursuant to this Agreement, Escrow Agent shall be released of all liability and responsibility under this Agreement. The Escrow Agent may act in reliance upon any writing or instrument or signature which it, in good faith, believes to be genuine. Escrow Agent may assume that any person purporting to give any writing, notice, advice or instructions in connection with the provisions hereof, has been duly authorized to do so. The Escrow Agent undertakes and agrees to perform only such duties as expressly set forth herein. The duty of the Escrow Agent hereunder shall be limited to the safe keeping of the escrow funds and the disposition of same in accordance with the provisions hereof. The Escrow Agent shall have the right, but not the obligation, to require a written statement signed by the Buyer and Seller confirming satisfaction of all conditions precedent to disbursement of funds hereunder and authorizing disbursement of said funds, together with accrued interest, if any. All notices to or from Escrow Agent shall be in writing. The Buyer and Seller hereby release Escrow Agent from any losses incurred with respect to funds deposited hereunder by reason of the absence of or insufficiency of FDIC insurance with respect to such funds. The Buyer and Seller acknowledge that Escrow Agent has entered into this Agreement at their specific request and, in order to induce Escrow Agent to accept said escrow, do hereby agree to indemnify and hold Escrow Agent harmless from all loss, cost and expense, including reasonable attorneys’ fees and court costs, which it may suffer or incur as a result of acting as Escrow Agent under this Agreement, including, without limitation, claims arising with respect to the absence or insufficiency of FDIC insurance for funds subject to this Agreement. In the event of any dispute as to the disbursement of escrow funds or any claim thereto by any party or person, Escrow Agent shall have the right to bring a suit in interpleader in the Circuit Court for ▇▇▇▇▇ County, Florida naming the parties to this Agreement and any other parties as may be appropriate in the opinion of Escrow Agent. The Buyer and Seller shall indemnify and hold harmless Escrow Agent from all costs, including attorneys’ fees, in connection with such interpleader action. Upon the filing of said suit and deposit of the balance of escrow funds in the registry of the Court, Escrow Agent shall have the right to withdraw from said suit, and all obligations of Escrow Agent shall cease and terminate.
10.20 No Back Offers or Agreements. Seller shall not, during the term of this Agreement, enter into any back up offers, agreements, options or the like for the sale of the Property to any third party and nor shall Seller market the Property for sale or otherwise solicit any of such back up offers, agreements, options or the like directly or indirectly through third parties.
10.21 Books and Records. Buyer has advised Seller that Buyer may be required to file, in compliance with certain laws and regulations (including, without limitation, Regulation S-X of the Securities and Exchange Commission), audited financial statements, pro forma financial statements and other financial information related to the Property for up to three (3) fiscal years prior to Closing and any interim period during the fiscal year in which the Closing occurs (the “Financial Information”). Following the Closing, Seller agrees to use its commercially reasonably efforts to cooperate with Buyer and its representatives and agents in the preparation of required Financial Information; provided, however, Seller shall not be required to incur any expenses or costs unless Buyer reimburses Seller for the same. Notwithstanding the foregoing, Seller shall not be required to provide any information deemed confidential by Seller in its reasonable discretion. Buyer acknowledges Buyer may not use the results of its review under this Section 10.21 to pursue any claim against Seller under the terms of this Agreement.
[SIGNATURES BEGIN ON FOLLOWING PAGE]
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written.
“SELLER” REGENCY REALTY GROUP, INC., a Florida corporation By: /s/ ▇▇▇▇▇ ▇. Argalas_________________ Name: ▇▇▇▇▇ ▇. Argalas Title: Senior Vice President Date: October 29, 2018 Tax Identification No: | |
“BUYER” THE ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ GROUP LLC, an Ohio limited liability company By: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ GROCERY CENTER OPERATING PARTNERSHIP I L.P., a Delaware limited partnership, Sole Member By: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ GROCERY CENTER OP GP I LLC, a Delaware limited liability company, General Partner By: /s/ ▇▇▇▇▇▇ ▇. Myers_____ Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ Its: Vice President Date: October 25, 2018 Tax Identification No: | |
CONSENT AND JOINDER
“RCLP”
REGENCY CENTERS, L.P., a Delaware limited partnership
By: Regency Centers Corporation
Its: General Partner
By: /s/ ▇▇▇▇▇ ▇. Argalas_________
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Senior Vice President
Date: October 30, 2018