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EXHIBIT 2.2
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PURCHASE AND SALE AGREEMENT
BETWEEN
AP CENTURY I, L.P.
AP CENTURY II, L.P.
AP CENTURY III, L.P.
AP CENTURY IV, L.P.
AP CENTURY V, L.P.
AP CENTURY VI, L.P.
AP CENTURY VIII, L.P.
AND
AP CENTURY IX, L.P.,
COLLECTIVELY, SELLERS
AND
NEW VALLEY CORPORATION,
PURCHASER
DATED: JANUARY 11, 1996
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TABLE OF CONTENTS
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Section 1. Sale of Properties..................................... 1
Section 2. Purchase Price......................................... 5
Section 3. Apportionments......................................... 6
Section 4. Closing Date........................................... 9
Section 5. Permitted Encumbrances................................. 9
Section 6. Title.................................................. 10
Section 7. The Note and Mortgage.................................. 12
Section 8. Representations and Warranties......................... 12
Section 9. Costs of Transaction................................... 19
Section 10. Conditions Precedent to Closing........................ 19
Section 11. Documents to be Delivered by Sellers at Closing........ 21
Section 12. Documents to be Delivered by Purchaser at Closing...... 23
Section 13. Operation of the Properties............................ 24
Section 14. As Is.................................................. 27
Section 15. Broker................................................. 29
Section 16. Casualty; Condemnation................................. 29
Section 17. Remedies............................................... 30
Section 18. Purchaser's Access to the Properties................... 31
Section 19. Sellers' Indemnity..................................... 32
Section 20. Escrow................................................. 32
Section 21. Assignment............................................. 35
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Page
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Section 22. Access to Records...................................... 35
Section 23. Notices................................................ 35
Section 25. Miscellaneous.......................................... 38
LIST OF SCHEDULES AND EXHIBITS
SCHEDULES DESCRIPTION
--------- -----------
1-A Description of the "AP-I Land"
1-B Description of the "AP-II Land"
1-C Description of the "AP-III Land"
1-D Description of the "AP-IV Land"
1-E Description of the "AP-V Land"
1-F Description of the "AP-VI Land"
1-G Description of the "AP-VIII Land"
1-H Description of the "AP-IX Land"
2 Permitted Encumbrances
3 Insured Encumbrances
3A Existing Financing
4 Leases
5 Actions
6 Rent Roll
7 Claimed Rental Offsets
7A Seller's Work
8 Tenants in Bankruptcy
9 Contracts
10 Defaults under the Contracts
11 Tenants Intending to Vacate
12 Defaults under the Leases
13 Casualty Insurance
14 Environmental & Engineering Reports
15 Tax Certiorari Proceedings
16 Trade Names
17 Tenants From Whom Estoppel Certificates Have Been Requested
18 Brokerage & Leasing Commissions
19 ▇.▇. ▇▇▇▇▇▇ Lease Terms
20 Intentionally Deleted
21 Indemnified Litigations
22 Basic Debt Service
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EXHIBITS DESCRIPTION
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A Form of Note
B Form of Mortgage
C Form of Loan and Security Agreement
D Hazardous Material Indemnification Agreement
E Deeds
F Lease Assignment
G Contract and License Assignment
H Intangible Property Assignment
I ▇▇▇▇ of Sale
J Notice to Tenants
K Sellers' FIRPTA Affidavit
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INDEX OF DEFINED TERMS
DEFINED TERM SECTION
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"AAA"....................................................... 8.1(b)
"Additional Rent Reconciliation"............................ 3.4
"Additional Rents".......................................... 3.4
"Agreement"................................................. Preamble
"AP-I"...................................................... Preamble
"AP-I Buildings"............................................ 1.1
"AP-I Land"................................................. 1.1
"AP-I Personal Property".................................... 1.1
"AP-II"..................................................... Preamble
"AP-II Buildings"........................................... 1.2
"AP-II Land"................................................ 1.2
"AP-II Personal Property"................................... 1.2
"AP-III".................................................... Preamble
"AP-III Buildings".......................................... 1.3
"AP-III Land"............................................... 1.3
"AP-III Personal Property".................................. 1.3
"AP-IV"..................................................... Preamble
"AP-IV Buildings"........................................... 1.4
"AP-IV Land"................................................ 1.4
"AP-IV Personal Property"................................... 1.4
"AP-V"...................................................... Preamble
"AP-V Buildings"............................................ 1.5
"AP-V Land"................................................. 1.5
"AP-V Personal Property".................................... 1.5
"AP-VI"..................................................... Preamble
"AP-VI Buildings"........................................... 1.6
"AP-VI Land"................................................ 1.6
"AP-VI Personal Property"................................... 1.6
"AP-VIII"................................................... Preamble
"AP-VIII Buildings"......................................... 1.7
"AP-VIII Land".............................................. 1.7
"AP-VIII Personal Property"................................. 1.7
"AP-IX"..................................................... Preamble
"AP-IX Buildings"........................................... 1.8
"AP-IX Land"................................................ 1.8
"AP-IX Personal Property"................................... 1.8
"Apportionment Date"........................................ 3.1
"Approved Institution"...................................... 20.5
"Approved Investment"....................................... 20.5
"▇▇▇▇▇"..................................................... 25.22
"Assignment Agreement"...................................... 11.1(d)
"▇▇▇▇ of Sale".............................................. 11.1(f)
"business day".............................................. 25.13
"Closing"................................................... 4.1
"Closing Date".............................................. 4.1
"Commerce Lender"........................................... 25.5 B.
"Contract and License Assignment"........................... 11.1(c)
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DEFINED TERM SECTION
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"Contracts"................................................. 8.1(a)(xiv)
"Coronado Center Property".................................. 1.2
"Cost"...................................................... 8.1(b)
"Deeds"..................................................... 11.1(a)
"Downpayment"............................................... 2.1(a)
"Environmental Laws"........................................ 8.1(a)(xxiii)
"Escrow Agent".............................................. 2.1(a)
"FIRPTA".................................................... 11.1(l)
"First Percentage".......................................... 8.1(b)
"Fund"...................................................... 20.1
"GECC"...................................................... 25.5 B.
"Hazardous Materials"....................................... 8.1(a)(xxiii)
"▇▇▇▇▇ Farm Shopping Center Property"....................... 1.3
"Intangible Property Assignment"............................ 11.1(d)
"Insurance"................................................. 8.1(a)(xix)
"Investigations"............................................ 18.1
"Kanawha Mall Property"..................................... 1.6
"Laws"...................................................... 8.1(a)(iii)
"Lease Assignment".......................................... 11.1(b)
"Leases".................................................... 8.1(a)(iv)
"Licenses".................................................. 11.1(c)
"Liens"..................................................... 6.2
"Loan Agreement"............................................ 7.2(a)
"Loss"...................................................... 8.1(b)
"Lutheran Lender"........................................... 25.5 B.
"Marathon Shopping Center Property"......................... 1.4
"Marysville Towne Center Property".......................... 1.5
"Master Lease".............................................. 13.4
"Mortgage".................................................. 2.1(b)
"NatWest"................................................... 25.5 B.
"New Lease"................................................. 13.1(a)(ii)
"New Lease Expenses"........................................ 13.1(a)(ii)
"Note"...................................................... 2.1(b)
"Notice of Objection"....................................... 20.3
"Permitted Encumbrances".................................... 5.1
"Personal Property"......................................... 1.8
"Properties"................................................ 1.8
"Property Information"...................................... 24.4
"Purchaser's actual knowledge".............................. 8.1(b)
"Purchase Price"............................................ 2.1
"Purchaser's Documents"..................................... 8.2(a)(ii)
"Purchaser's Reports"....................................... 8.1(a)(xxi)
"Purchaser's Representatives"............................... 24.4
"Purchaser"................................................. Preamble
"Rent Commencement Date".................................... 13.1(a)(iii)
"Rent Roll"................................................. 8.1(a)(viii)
"Second Percentage"......................................... 8.1(b)
"Sellers' Affiliates"....................................... 25.5
"Sellers' Documents"........................................ 8.1(a)(ii)
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DEFINED TERM SECTION
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"Sellers' knowledge"........................................ 8.1(a)(xxiii)
"Sellers"................................................... Preamble
"Sellers' Reports".......................................... 8.1(a)(xx)
"Title Commitments"......................................... 6.1(a)
"Title Company"............................................. 6.1(a)
"Unacceptable Encumbrances"................................. 6.1(a)
"Union Lender".............................................. 25.5 B.
"University Place Property"................................. 1.8
"Village Royale Shopping Center Property"................... 1.7
"Washington Plaza Property"................................. 1.1
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PURCHASE AND SALE AGREEMENT
This PURCHASE AND SALE AGREEMENT (this "Agreement"), dated the
11th day of January, 1996, by and between AP CENTURY I, L.P. ("AP-I"), AP
CENTURY II, L.P. ("AP-II"), AP CENTURY III, L.P. ("AP-III"), AP CENTURY IV, L.P.
("AP-IV"), AP CENTURY V, L.P. ("AP-V"), AP CENTURY VI, L.P. ("AP-VI"), AP
CENTURY VIII, L.P. ("AP-VIII") and AP CENTURY IX, L.P. ("AP-IX"), each a limited
partnership organized and existing under the State of Delaware and all of which
have an office at c/o Century Properties, Inc., ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ (collectively "Sellers"), and NEW VALLEY
CORPORATION, a New York corporation, having an office at ▇▇▇ ▇.▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ ("Purchaser").
W I T N E S S E T H
WHEREAS, each Seller is the owner of a Property (as
hereinafter defined);
WHEREAS, Purchaser desires to purchase the Properties from
Sellers; and
WHEREAS, Sellers and Purchaser desire to enter into an
agreement whereby, subject to the terms and conditions contained herein, Sellers
shall sell the Properties to Purchaser and Purchaser shall purchase the
Properties from Sellers.
NOW, THEREFORE, in consideration of ten ($10.00) dollars and
the mutual covenants and agreements hereinafter set forth, and intending to be
legally bound hereby, it is hereby agreed as follows:
Section 1. Sale of Properties
1.1 AP-I agrees to sell and convey to Purchaser, and
Purchaser agrees to purchase from AP-I, at the price and upon the terms and
conditions set forth in this Agreement, all those certain plots, pieces and
parcels of land located in the City of Richland, County of ▇▇▇▇▇▇ and State of
Washington, as more particularly described in Schedule "1-A" annexed hereto and
made a part hereof (the "AP-I Land"), together with (a) all buildings and other
improvements situated on the land (collectively, the "AP-I Buildings"), (b) all
easements, rights of way, reservations, privileges, appurtenances, and other
estates and rights of AP-I pertaining to the AP-I Land and the AP-I Buildings,
(c) all right, title and interest of AP-I in and to all fixtures, machinery,
equipment, supplies and other articles of personal property attached or
appurtenant to the AP-I Land or the AP-I Buildings, or used in connection
therewith (collectively, the "AP-I Personal Property"), (d) all oil, gas and
mineral rights of AP-I, if any, in and to the AP-I Land, (e) all right, title
and interest of AP-I, if any, in and to the trade names of the AP-I Buildings,
and (f) all right, title and interest of AP-I, if any, in and to all strips and
gores, all alleys adjoining the AP-I Land, and the land lying in the bed of any
street, road or avenue, opened or proposed, in front of or adjoining the AP-I
Land to the center line thereof, and all right, title and interest of AP-I, if
any, in and to any award made or to be made in lieu thereof and in and to any
unpaid award for any taking by condemnation or any damages to the AP-I Land or
the AP-I Buildings by reason of a change of grade of any street, road or avenue
(the AP-I Land, together with all of the foregoing items listed in clauses
(a)-(f) above being hereinafter sometimes collectively referred to as the
"Washington Plaza Property").
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1.2 AP-II agrees to sell and convey to Purchaser, and
Purchaser agrees to purchase from AP-II, at the price and upon the terms and
conditions set forth in this Agreement, all those certain plots, pieces and
parcels of land located in the City of Santa Fe, County of Santa Fe and State of
New Mexico as more particularly described in Schedule "1- B" annexed hereto and
made a part hereof (the "AP-II Land"), together with (a) all buildings and other
improvements situated on the land (collectively, the "AP-II Buildings"), (b) all
easements, rights of way, reservations, privileges, appurtenances, and other
estates and rights of AP-II pertaining to the AP-II Land and the AP-II
Buildings, (c) all right, title and interest of AP-II in and to all fixtures,
machinery, equipment, supplies and other articles of personal property attached
or appurtenant to the AP-II Land or the AP-II Buildings, or used in connection
therewith (collectively, the "AP-II Personal Property"), (d) all oil, gas and
mineral rights of AP-II, if any, in and to the AP-II Land, (e) all right, title
and interest of AP-II, if any, in and to the trade names of the AP-II Buildings,
and (f) all right, title and interest of AP-II, if any, in and to all strips and
gores, all alleys adjoining the AP-II Land, and the land lying in the bed of any
street, road or avenue, opened or proposed, in front of or adjoining the AP-II
Land to the center line thereof, and all right, title and interest of AP-II, if
any, in and to any award made or to be made in lieu thereof and in and to any
unpaid award for any taking by condemnation or any damages to the AP-II Land or
the AP-II Buildings by reason of a change of grade of any street, road or avenue
(the AP-II Land, together with all of the foregoing items listed in clauses
(a)-(f) above being hereinafter sometimes collectively referred to as the
"Coronado Center Property").
1.3 AP-III agrees to sell and convey to Purchaser, and
Purchaser agrees to purchase from AP-III, at the price and upon the terms and
conditions set forth in this Agreement, all those certain plots, pieces and
parcels of land located in the City of Milwaukee, County of Clackamas and State
of Oregon as more particularly described in Schedule "1-C" annexed hereto and
made a part hereof (the "AP-III Land"), together with (a) all buildings and
other improvements situated on the land (collectively, the "AP-III Buildings"),
(b) all easements, rights of way, reservations, privileges, appurtenances, and
other estates and rights of AP-III pertaining to the AP-III Land and the AP-III
Buildings, (c) all right, title and interest of AP-III in and to all fixtures,
machinery, equipment, supplies and other articles of personal property attached
or appurtenant to the AP-III Land or the AP-III Buildings, or used in connection
therewith (collectively, the "AP-III Personal Property"), (d) all oil, gas and
mineral rights of AP-III, if any, in and to the AP-III Land, (e) all right,
title and interest of AP-III, if any, in and to the trade names of the AP-III
Buildings, and (f) all right, title and interest of AP-III, if any, in and to
all strips and gores, all alleys adjoining the AP-III Land, and the land lying
in the bed of any street, road or avenue, opened or proposed, in front of or
adjoining the AP-III Land to the center line thereof, and all right, title and
interest of AP-III, if any, in and to any award made or to be made in lieu
thereof and in and to any unpaid award for any taking by condemnation or any
damages to the AP-III Land or the AP-III Buildings by reason of a change of
grade of any street, road or avenue (the AP-III Land, together with all of the
foregoing items listed in clauses (a)-(f) above being hereinafter sometimes
collectively referred to as the "▇▇▇▇▇ Farm Shopping Center Property").
1.4 AP-IV agrees to sell and convey to Purchaser, and
Purchaser agrees to purchase from AP-IV, at the price and upon the terms and
conditions set forth in this Agreement, all those certain plots, pieces and
parcels of land located in the City of Marathon, County of Monroe and State of
Florida, as more particularly described in Schedule "1-D" annexed hereto and
made a part hereof (the "AP-IV Land"), together with (a) all buildings and other
improvements situated on the land (collectively, the "AP-IV Buildings"), (b) all
easements, rights of way, reservations, privileges, appurtenances, and other
estates and rights
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of AP-IV pertaining to the AP-IV Land and the AP-IV Buildings, (c) all right,
title and interest of AP-IV in and to all fixtures, machinery, equipment,
supplies and other articles of personal property attached or appurtenant to the
AP-IV Land or the AP-IV Buildings, or used in connection therewith
(collectively, the "AP-IV Personal Property"), (d) all oil, gas and mineral
rights of AP-IV, if any, in and to the AP-IV Land, (e) all right, title and
interest of AP-IV, if any, in and to the trade names of the AP-IV Buildings, and
(f) all right, title and interest of AP-IV, if any, in and o all strips and
gores, all alleys adjoining the AP-IV Land, and the land lying in the bed of any
street, road or avenue, opened or proposed, in front of or adjoining the AP-IV
Land to the center line thereof, and all right, title and interest of AP-IV, if
any, in and to any award made or to be made in lieu thereof and in and to any
unpaid award for any taking by condemnation or any damages to the AP-IV Land or
the AP-IV Buildings by reason of a change of grade of any street, road or avenue
(the AP-IV Land, together with all of the foregoing items listed in clauses
(a)-(f) above being hereinafter sometimes collectively referred to as the
"Marathon Shopping Center Property").
1.5 AP-V agrees to sell and convey to Purchaser, and
Purchaser agrees to purchase from AP-V, at the price and upon the terms and
conditions set forth in this Agreement, all those certain plots, pieces and
parcels of land located in the City of Marysville, County of Snohomish and State
of Washington, as more particularly described in Schedule "1-E" annexed hereto
and made a part hereof (the "AP-V Land"), together with (a) all buildings and
other improvements situated on the land (collectively, the "AP-V Buildings"),
(b) all easements, rights of way, reservations, privileges, appurtenances, and
other estates and rights of AP-V pertaining to the AP-V Land and the AP-V
Buildings, (c) all right, title and interest of AP-V in and to all fixtures,
machinery, equipment, supplies and other articles of personal property attached
or appurtenant to the AP-V Land or the AP-V Buildings, or used in connection
therewith (collectively, the "AP-V Personal Property"), (d) all oil, gas and
mineral rights of AP-V, if any, in and to the AP-V Land, (e) all right, title
and interest of AP-V, if any, in and to the trade names of the AP-V Buildings,
and (f) all right, title and interest of AP-V, if any, in and to all strips and
gores, all alleys adjoining the AP-V Land, and the land lying in the bed of any
street, road or avenue, opened or proposed, in front of or adjoining the AP-V
Land to the center line thereof, and all right, title and interest of AP-V, if
any, in and to any award made or to be made in lieu thereof and in and to any
unpaid award for any taking by condemnation or any damages to the AP-V Land or
the AP-V Buildings by reason of a change of grade of any street, road or avenue
(the AP-V Land, together with all of the foregoing items listed in clauses
(a)-(f) above being hereinafter sometimes collectively referred to as the
"Marysville Towne Center Property").
1.6 AP-VI agrees to sell and convey to Purchaser, and
Purchaser agrees to purchase from AP-VI, at the price and upon the terms and
conditions set forth in this Agreement, all those certain plots, pieces and
parcels of land located in the City of Charleston, County of Kanawha and State
of West Virginia, as more particularly described in Schedule "1-F" annexed
hereto and made a part hereof (the "AP-VI Land"), together with (a) all
buildings and other improvements situated on the land (collectively, the "AP-VI
Buildings"), (b) all easements, rights of way, reservations, privileges,
appurtenances, and other estates and rights of AP-VI pertaining to the AP-VI
Land and the AP-VI Buildings, (c) all right, title and interest of AP-VI in and
to all fixtures, machinery, equipment, supplies and other articles of personal
property attached or appurtenant to the AP-VI Land or the AP-VI Buildings, or
used in connection therewith (collectively, the "AP-VI Personal Property"), (d)
all oil, gas and mineral rights of AP-VI, if any, in and to the AP-VI Land, (e)
all right, title and interest of AP-VI, if any, in and to the trade names of the
AP-VI Buildings, and (f) all right, title and interest of AP-VI, if any, in and
to all strips and gores, all alleys adjoining the
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AP-VI Land, and the land lying in the bed of any street, road or avenue, opened
or proposed, in front of or adjoining the AP-VI Land to the center line thereof,
and all right, title and interest of AP-VI, if any, in and to any award made or
to be made in lieu thereof and in and to any unpaid award for any taking by
condemnation or any damages to the AP-VI Land or the AP-VI Buildings by reason
of a change of grade of any street, road or avenue (the AP-VI Land, together
with all of the foregoing items listed in clauses (a)-(f) above being
hereinafter sometimes collectively referred to as the "Kanawha Mall Property").
1.7 AP-VIII agrees to sell and convey to Purchaser, and
Purchaser agrees to purchase from AP-VIII, at the price and upon the terms and
conditions set forth in this Agreement, all those certain plots, pieces and
parcels of land located in the City of Royal Palm Beach, County of Palm Beach
and State of Florida, as more particularly described in Schedule "1-G" annexed
hereto and made a part hereof (the "AP-VIII Land"), together with (a) all
buildings and other improvements situated on the land (collectively, the
"AP-VIII Buildings"), (b) all easements, rights of way, reservations,
privileges, appurtenances, and other estates and rights of AP-VIII pertaining to
the AP-VIII Land and the AP-VIII Buildings, (c) all right, title and interest of
AP-VIII in and to all fixtures, machinery, equipment, supplies and other
articles of personal property attached or appurtenant to the AP-VIII Land or the
AP-VIII Buildings, or used in connection therewith (collectively, the "AP-VIII
Personal Property"), (d) all oil, gas and mineral rights of AP-VIII, if any, in
and to the AP-VIII Land, (e) all right, title and interest of AP-VIII, if any,
in and to the trade names of the AP-VIII Buildings, and (f) all right, title and
interest of AP-VIII, if any, in and to all strips and gores, all alleys
adjoining the AP-VIII Land, and the land lying in the bed of any street, road or
avenue, opened or proposed, in front of or adjoining the AP-VIII Land to the
center line thereof, and all right, title and interest of AP-VIII, if any, in
and to any award made or to be made in lieu thereof and in and to any unpaid
award for any taking by condemnation or any damages to the AP-VIII Land or the
AP-VIII Buildings by reason of a change of grade of any street, road or avenue
(the AP-VIII Land, together with all of the foregoing items listed in clauses
(a)-(f) above being hereinafter sometimes collectively referred to as the
"Village Royale Shopping Center Property").
1.8 AP-IX agrees to sell and convey to Purchaser, and
Purchaser agrees to purchase from AP-IX, at the price and upon the terms and
conditions set forth in this Agreement, all those certain plots, pieces and
parcels of land located in the City of Lincoln, County of Lancaster and State of
Nebraska, as more particularly described in Schedule "1-H" annexed hereto and
made a part hereof (the "AP-IX Land"), together with (a) all buildings and other
improvements situated on the and (collectively, the "AP-IX Buildings"), (b) all
easements, rights of way, reservations, privileges, appurtenances, and other
estates and rights of AP-IX pertaining to the AP-IX Land and the AP-IX
Buildings, (c) all right, title and interest of AP-IX in and to all fixtures,
machinery, equipment, supplies and other articles of personal property attached
or appurtenant to the AP-IX Land or the AP-IX Buildings, or used in connection
therewith (collectively, the "AP-IX Personal Property"; the AP-I Personal
Property, the AP-II Personal Property, the AP-III Personal Property, the AP-IV
Personal Property, the AP-V Personal Property, the AP-VI Personal Property, the
AP-VIII Personal Property, and the AP-IX Personal Property are hereinafter
collectively called the "Personal Property"), (d) all oil, gas and mineral
rights of AP-IX, if any, in and to the AP-IX Land, (e) all right, title and
interest of AP-IX, if any, in and to the trade names of the AP-IX Buildings, and
(f) all right, title and interest of AP-IX, if any, in and to all strips and
gores, all alleys adjoining the AP-IX Land, and the land lying in the bed of any
street, road or avenue, opened or proposed, in front of or adjoining the AP-IX
Land to the center line thereof, and all right, title and interest of AP-IX, if
any, in and to any award made or to be made in lieu thereof
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and in and to any unpaid award for any taking by condemnation or any damages to
the AP-IX Land or the AP-IX Buildings by reason of a change of grade of any
street, road or avenue (the AP-IX Land, together with all of the foregoing items
listed in clauses (a)-(f) above being hereinafter sometimes collectively
referred to as the "University Place Property"; the Washington Plaza Property,
the Coronado Center Property , the ▇▇▇▇▇ Farm Shopping Center Property, the
Marathon Shopping Center Property, the Marysville Towne Center Property, the
Kanawha Mall Property, the Village Royale Shopping Center Property and the
University Place Property are hereinafter collectively called the "Properties").
Section 2. Purchase Price
2.1 The purchase price to be paid by Purchaser to Sellers
for the Properties (the "Purchase Price") is Seventy Two Million Five Hundred
Thousand ($72,500,000) Dollars, payable as follows:
(a) One Million Four Hundred Fifty Thousand ($1,450,000)
Dollars (the "Downpayment"), simultaneously with the execution and delivery of
this Agreement, by a bank wire transfer of immediately available funds to an
account designated by ▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇ ("Escrow Agent"). The Downpayment
shall be held by Escrow Agent in accordance with the terms of Section 20. If the
Closing (as hereinafter defined) shall occur, Sellers shall be entitled to
receive the Downpayment and all interest accrued thereon, if any, and such
interest shall not be credited against the portion of the Purchase Price payable
pursuant to Section 2.1(c). Notwithstanding the foregoing, in the event this
Agreement is entered into at the Closing, the Downpayment shall be paid at the
Closing directly to Sellers by bank wire transfer of immediately available
federal funds to Sellers' account, Section 20 shall be of no force and effect
and Escrow Agent shall not be required to join in this Agreement.
(b) Sixty Million ($60,000,000) Dollars at the Closing by
Purchaser executing and delivering to Sellers, or such Affiliate of Sellers as
Sellers may direct, a purchase money note or notes (the "Note") payable to
Sellers or to such Affiliate in the amount of Sixty Million ($60,000,000)
Dollars and a purchase money mortgage or mortgages and/or a deed of trust or
deeds of trust (the "Mortgage") securing the Note and covering the Properties,
all as more particularly set forth in Section 7.
(c) Eleven Million Fifty Thousand ($11,050,000) Dollars at
the Closing by bank wire transfer of immediately available federal funds to
Sellers' account or to the account or accounts (not to exceed ten such accounts)
of such other party or parties as may be designated by Sellers on one (1)
business day's notice prior to the Closing Date.
(d) Except as otherwise specifically set forth herein,
Sellers and Purchaser agree that Sellers must convey and Purchaser must purchase
all of the Properties in accordance with the terms and conditions of this
Agreement.
(e) The Purchase Price as set forth above is the aggregate
amount to be paid to Sellers for the Properties, and the portion of the Purchase
Price allocable to each Property is as set forth below.
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Allocated
Property Purchase Price
-------- --------------
(i) Washington Plaza Property $10,610,000
(ii) Coronado Shopping Center Property $ 9,600,000
(iii) ▇▇▇▇▇ Farm Shopping Center Property $ 7,280,000
(iv) Marathon Shopping Center Property $ 3,900,000
(v) Marysville Towne Center Property $12,350,000
(vi) Kanawha Mall Property $12,950,000
(vii) Village Royale Shopping Center Property $ 9,840,000
(viii) University Place Property $ 5,970,000
Section 3. Apportionments
3.1 The following shall be apportioned between Sellers and
Purchaser at the Closing as of 12:01 A.M., January 1, 1996 (the "Apportionment
Date") notwithstanding the Apportionment Date may not be the Closing Date (as
hereinafter defined):
(a) prepaid rents and Additional Rents and other
amounts payable by tenants, if, as and when received;
(b) real estate taxes, water charges, sewer rents and
vault charges, if any, on the basis of the fiscal years, respectively, for which
same have been assessed;
(c) value of fuel stored on the Properties, at
Sellers' cost, including any taxes, on the basis of a statement from Sellers'
supplier;
(d) charges and payments under Contracts (as
hereinafter defined) which are transferred to Purchaser or permitted renewals or
replacements thereof;
(e) any prepaid items for operating expenses relating
to the Properties, including fees for licenses which are transferred to
Purchaser at the Closing and annual permit and inspection fees;
(f) utilities, including telephone, steam,
electricity and gas, on the basis of the most recently issued bills therefor,
subject to adjustment after the Closing when the next bills are available, or if
current meter readings are available, on the basis of such readings;
(g) transferable deposits with telephone and other
utility companies, and any other persons or entities who supply goods or
services in connection with the Properties, if same are assigned to Purchaser at
the Closing, which shall be credited in their entirety to Sellers;
(h) personal property taxes, if any, on the basis of
the fiscal year for which assessed;
(i) Sellers' share, if any, of all revenues from the
operation of the Properties other than rents and Additional Rents (including
parking charges, and telephone booth and vending machine revenues), if, as and
when received;
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(j) permitted administrative charges, if any, on
those tenants' security deposits transferred by Sellers pursuant to Section
11.1(e); and
(k) as to each Property, such other items as are
customarily apportioned between sellers and purchasers of real properties of a
type similar to the Properties and located in the city and state where the
Property is located.
Interest on the Note shall accrue commencing on the Apportionment Date.
3.2 If the Closing shall occur before a new real estate or
personal property tax rate is fixed, the apportionment of taxes at the Closing
shall be upon the basis of the old tax rate for the preceding fiscal year
applied to the latest assessed valuation. Promptly after the new tax rate is
fixed, the apportionment of taxes shall be recomputed and any discrepancy
resulting from such recomputation and any errors or omissions in computing
apportionments at Closing shall be promptly corrected and the proper party
reimbursed.
3.3 If on the Closing Date any tenant is in arrears in the
payment of rent or has not paid the rent payable by it for the month in which
the Closing occurs (whether or not it is in arrears for such month on the
Closing Date), any rents received by Purchaser or Sellers from such tenant after
the Closing shall be applied to rents due and payable by such tenant in the
following order of priority: first, to all rent due and payable by such tenant
during the month in which the Apportionment Date occurred, second, to all rents
due and payable by such tenant for the month immediately preceding the month in
which the Apportionment Date occurred, third, to all rents due and payable by
such tenant for the months immediately following the month in which the
Apportionment Date occurred, and, fourth, to all remaining rent arrearages of
such tenant. If rents or any portion thereof received by Sellers or Purchaser
after the Closing are due and payable to the other party by reason of this
allocation, the appropriate sum, less a proportionate share of any reasonable
attorneys' fees and costs and expenses expended in connection with the
collection thereof, shall be promptly paid to the other party.
3.4 If on the Apportionment Date (or thereafter pursuant to
an Additional Rent Reconciliation) (defined below) any tenant is in arrears or
was undercharged (whether in its monthly obligations or in an end of year
reconciliation) in the payment of percentage rent, escalation charges for real
estate taxes, parking charges, operating expenses and maintenance escalation
rents or charges, cost-of-living increases or other charges of a similar nature
("Additional Rents") for the period prior to the Apportionment Date, any
Additional Rents received by Purchaser or Sellers from such tenant after the
Closing Date shall be applied up to $50,000 (net of all reimbursements to
tenants for overpayment of Additional Rent for the period prior to the
Apportionment Date) to all Additional Rent arrearages of such tenant for the
period prior to the Apportionment Date. If such Additional Rent arrearages
exceed $50,000 (net of all reimbursements to tenants for overpayment of
Additional Rent for the period prior to the Apportionment Date) then, provided
first that such tenant is current in all of its rent and Additional Rent
obligations for the period commencing with the Apportionment Date, the next
Additional Rents received by Purchaser or Sellers from such tenant shall be
applied to all remaining Additional Rent arrearages of such tenant for the
period prior to the Apportionment Date. If Additional Rents or any portion
thereof received by Sellers or Purchaser after the Closing are due and payable
to the other party by reason of this allocation, the appropriate sum, less a
proportionate share of any reasonable attorneys' fees and costs and expenses
expended in connection with the collection thereof, shall be promptly paid to
the other party. "Additional Rent Reconciliation" means an accounting prepared
by Sellers in
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calendar year 1996 and delivered to Purchaser by no later than March 31, 1996 to
determine if Sellers' estimated Additional Rent calculation for calendar year
1995 was exceeded by the actual Additional Rent calculation as determined by
Sellers. Purchaser and Purchaser's property manager shall in good faith assist
Sellers (a) in the preparation of the Additional Rent Reconciliation and (b),
subject to Section 3.5, in the billing for and collecting of the Additional Rent
arrearages including adding such Additional Rent arrearages to Purchaser's
monthly billing of tenants for rent and Additional Rent. If the Additional Rent
Reconciliation determines that any tenants have overpaid their Additional Rent
obligations for the calendar year 1995 (net of all arrearages for any such
tenant for such period) then Sellers shall pay such amounts promptly to
Purchaser. Purchaser agrees to promptly forward such sums to the applicable
tenants (or to grant such tenants credits against rents next due) and indemnify
and hold Sellers harmless in connection with any losses, costs, expenses or
liabilities in connection with Purchaser's failure to remit such sums (or grant
such credits) to such tenants.
3.5 After the Closing, Sellers shall continue to have the
right, in its own name, to demand payment of and to collect rent and Additional
Rent arrearages owed to Sellers by any tenant, which right shall include the
right to continue or commence legal actions or proceedings against any tenant
for the payment of such arrearages (provided, however, Seller shall not commence
or continue any legal action or proceeding to terminate a tenant's tenancy or to
dispossess such tenant or otherwise disturb such tenant's occupancy), and
delivery of the Lease Assignment (as hereinafter defined) shall not constitute a
waiver by Sellers of such right. At no cost to Purchaser or if Purchaser incurs
any cost Sellers agree to reimburse Purchaser for same, Purchaser agrees
reasonably to cooperate with Sellers in connection with all reasonable and
proper efforts by Sellers to collect such rents and Additional Rents and to take
all reasonable steps, including adding the rent arrearages to Purchaser's bills
to tenant for current rent obligations and testifying on behalf of Sellers,
whether before or after the Closing Date, as may be reasonably necessary to
carry out the intention of the foregoing, including the delivery to Sellers,
upon demand and to the extent then in Purchaser's possession, of any relevant
books and records (including any rent or Additional Rent statements, receipted
bills and copies of tenant checks used in payment of such rent or Additional
Rent), the execution of any and all consents or other documents, and the
undertaking of any other reasonable act necessary for the collection of such
rents and Additional Rents by Sellers. If tenant, in response to Sellers' legal
actions or proceedings to recover rent and Additional Rent arrearages, commences
its own legal action against Sellers or files a counterclaim to Sellers' legal
action or proceeding, and tenant's legal action or counterclaim names Purchaser
as a defendant, then, in such event, Sellers hereby indemnify and agree to hold
harmless and defend Purchaser against all such claims and counterclaims and
against all losses, costs, expenses and liabilities which Purchaser may suffer
or be subject to by reason thereof; and any such defense by Sellers may, at
Sellers' election, be conducted by counsel of Sellers' choice provided such
counsel is reasonably acceptable to Purchaser. Purchaser shall promptly notify
Sellers in writing if Purchaser is named as a defendant as a result of Sellers'
legal action or proceeding.
3.6 If there is a water meter on the Properties, Sellers
shall furnish a reading for each such Property to a date not more than thirty
(30) days prior to the Apportionment Date, and the unfixed water charges and
sewer rent, if any, based thereon for the intervening time shall be apportioned
on the basis of such last reading.
3.7 If any of the items subject to apportionment under the
foregoing provisions of this Section 3 cannot be apportioned at the Closing
because of the unavailability of the information necessary to compute such
apportionment, or if any errors or omissions in
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computing apportionments at the Closing are discovered subsequent to the
Closing, then such item shall be reapportioned and such errors and omissions
corrected as soon as practicable after the Closing Date and the proper party
reimbursed, which obligation shall survive the Closing for a period of one
hundred eighty (180) days after the Closing Date as hereinafter provided.
Neither party hereto shall have the right to require a recomputation of a
Closing apportionment or a correction of an error or omission in a Closing
apportionment unless within the aforestated one hundred eighty (180) day period
one of the parties hereto (a) has obtained the previously unavailable
information or has discovered the error or omission, and (b) has given notice
thereof to the other party together with a copy of its good faith recomputation
of the apportionment and copies of all substantiating information used in such
recomputation. The failure of a party to obtain any previously unavailable
information or discover an error or omission with respect to an item subject to
apportionment hereunder and to give notice thereof as provided above within one
hundred eighty (180) days after the Closing Date shall be deemed a waiver of its
right to cause a recomputation or a correction of an error or omission with
respect to such item after the Closing Date.
3.8 (a) If, on the date of this Agreement, the Properties or
any part thereof shall be affected by any assessment or assessments which are or
may become payable in installments, of which the first installment is now a
charge or lien, or has been paid, then (i) Sellers shall be obligated to pay all
installments of any such assessment which are due and payable prior to the
Closing Date, and (ii) for the purposes of this Agreement, all the unpaid
installments of any such assessment which are to become due and payable on or
after the Closing Date shall not be deemed to be liens upon the Properties and
Purchaser shall acquire the Properties on the Closing Date subject to any such
assessment without abatement of the Purchase Price.
(b) If, subsequent to the date hereof, the Properties or
any part thereof shall become affected by an assessment or assessments, said
assessments shall not be deemed to be liens upon the Properties and the
Purchaser shall acquire the Properties on the Closing Date subject to any such
assessment without abatement of the Purchase Price. If an assessment may be paid
alternatively, at Sellers election, in installments or in lump sum and such
election must be made prior to the Closing Date, Sellers shall make an election
to have same payable in installments. In the event any such assessment or
assessments, whether payable in lump sum or in installments, is due and payable
prior to the Closing, and has been paid by Sellers, Purchaser shall reimburse
Sellers for same at the Closing.
3.9 The provisions of this Section 3 shall survive the
Closing, but the provisions of Section 3.2 and 3.7 shall survive the Closing
only for a period of one hundred and eighty (180) days following the Closing
Date.
Section 4. Closing Date
4.1 The delivery of the Deeds and the consummation of the
transactions contemplated by this Agreement (the "Closing") shall take place as
of the date hereof at the offices of ▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ (the "Closing Date").
Section 5. Permitted Encumbrances
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5.1 Sellers shall convey and Purchaser shall accept title
to each of the Properties subject only to those matters set forth on Schedule
"2" annexed hereto and made a part hereof (collectively, the "Permitted
Encumbrances").
Section 6. Title
6.1 (a) Seller shall order, at its sole cost and expense,
commitments for an owner's fee title insurance policy or policies with respect
to the Properties (the "Title Commitments") from First American Title Insurance
Company (the "Title Company") and shall request the Title Company to deliver
copies of the Title Commitments, together with true and complete copies of all
instruments giving rise to any defects or exceptions to title to the Properties,
to Purchaser's and Sellers' attorneys. (Any liens, encumbrances or other defects
or exceptions in or to title to the Properties other than the Permitted
Encumbrances set forth in the Title Commitments are herein collectively called
the "Unacceptable Encumbrances".)
(b) If Sellers are unable (subject to Section 6.2) to
eliminate all Unacceptable Encumbrances not waived in writing by Purchaser, or
with respect to those matters which are listed on Schedule "3", to arrange for
title insurance reasonably acceptable to Purchaser insuring against enforcement
of such Unacceptable Encumbrances against, or collection of the same out of, the
Properties, and to convey title in accordance with the terms of this Agreement
on or before the Closing Date, Purchaser shall elect either (i) to waive such
Unacceptable Encumbrance(s) and consummate the transactions contemplated hereby
without any reduction of or credit against the Purchase Price, or (ii) to
exclude the Property with the Unacceptable Encumbrances from this sale and, in
such event, the Purchase Price shall be reduced by the allocated Purchase Price
for such Property (as set forth in Section 2.1(e) of this Agreement) (and the
cash portion of the Purchase Price and the principal amount of the Note and the
Mortgage shall be reduced pro rata), the definition of Properties shall not
include such Property and neither party shall have any further rights,
obligations or liabilities hereunder with respect to such Property, except as
otherwise set forth herein.
6.2 Notwithstanding anything to the contrary set forth in
this Section 6 or elsewhere in this Agreement, Sellers shall not be obligated to
bring any action or proceeding, to make any payments or otherwise to incur any
expense in order to eliminate Unacceptable Encumbrances not waived in writing by
Purchaser or to arrange for title insurance (at Sellers' cost and expense), with
respect to those matters which are listed on Schedule "3", insuring against
enforcement of such Unacceptable Encumbrances against, or collection of the same
out of, the Properties; except that (A) Sellers shall satisfy mortgages, real
estate taxes, assessments, monetary judgments against Sellers and any other
liens that are liquidated in amount (collectively, "Liens") secured by or
affecting the Properties which are Unacceptable Encumbrances and which can be
satisfied by payment of liquidated amounts unless Sellers arrange for such
Unacceptable Encumbrances to be omitted from Purchaser's fee title insurance
policy, and (B) with respect to those matter which are listed in Schedule "3",
Sellers shall arrange for title insurance (at Sellers' cost and expense)
reasonably acceptable to Purchaser insuring against enforcement or collection of
such Unacceptable Encumbrances. Without limiting the generality of the preceding
provisions of this Section 6.2, for the purposes of this Agreement (including
Sections 6.1 and 17.1), Sellers' failure or refusal to bring any action or
proceeding, to make any payments or to otherwise incur any expense, except for
(A) Sellers' obligation to satisfy Liens which can be satisfied by payment of
liquidated amounts as aforesaid and (B) Sellers' obligation to pay for title
insurance insuring against enforcement or collection with respect to those
matters which are listed on Schedule
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"3", in order to eliminate Unacceptable Encumbrances not waived in writing by
Purchaser, shall be deemed an inability of Sellers to eliminate such
Unacceptable Encumbrances and shall not be a default by Sellers hereunder
(willful or otherwise).
6.3 If on the Closing Date there may be any Liens or other
encumbrances which Sellers must pay or discharge in order to convey to Purchaser
such title as is herein provided to be conveyed, Sellers may use any part of the
cash balance portion of the Purchase Price to satisfy the same, provided:
(a) Sellers shall deliver to Purchaser or the Title
Company, at the Closing, instruments in recordable form and sufficient to
satisfy such Liens or other encumbrances of record and omit the same from the
Purchaser's fee title insurance policy together with the cost of recording or
filing said instruments; or
(b) Sellers, having made arrangements with the Title
Company, shall deposit with said company sufficient monies acceptable to said
company to insure the obtaining and the recording of such satisfactions and the
omitting of same from Purchaser's fee title insurance policy.
The existence of any such Liens or other encumbrances shall not be deemed
objections to title if Sellers shall comply with the foregoing requirements.
6.4 Purchaser, if request is made by Sellers two (2)
business days prior to the Closing, agrees to provide at the Closing separate
unendorsed certified or official bank checks payable to the order of such
parties as are designated by Sellers and drawn on or by a Clearing House Bank,
aggregating not in excess of the outstanding amount of the Purchase Price
payable pursuant to Section 2.1(c), as apportioned, in order to facilitate the
satisfaction or release of any Liens or other encumbrances. Similarly, at
Sellers' election, unpaid Liens for taxes, water and sewer charges and
assessments, which are the obligation of Sellers to satisfy and discharge, shall
not be objections to title if the same are omitted from Purchaser's fee title
insurance policy, but the amount thereof, plus interest and penalties thereon,
if any, computed to the third (3rd) business day after the Closing Date, shall
be deducted from the Purchase Price payable pursuant to Section 2.1(c) and shall
be allowed to Purchaser, subject to the provisions for apportionment of taxes,
water and sewer charges and assessments contained herein.
6.5 If on the Closing Date there shall be conditional bills
of sale, chattel mortgages or security interests filed against any of the
Properties, the same shall not constitute objections to title provided that the
Title Company omits the same from the owner's fee title insurance policy and
Sellers execute and deliver an affidavit to the effect either (a) that the
personal property covered by said conditional bills of sale, chattel mortgages,
or security interests is no longer in or on such Properties, or (b) if such
personal property is still in or on such Properties, that it has been fully paid
for (and Sellers provide reasonable proof thereof to Purchaser), or (c) that
such personal property is the property of a tenant of such Properties.
6.6 Any franchise or corporate tax open, levied or imposed
against Sellers or other owners in the chain of title that may be a Lien on the
Closing Date, shall not be an objection to title if the Title Company omits same
from the title policy issued pursuant to the Title Commitment.
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6.7 If a search of title discloses judgments, bankruptcies
or other returns against other persons or entities having names the same as or
similar to that of Sellers, Sellers will deliver to Purchaser and the Title
Company an affidavit stating that such judgments, bankruptcies or other returns
are not against Sellers, whereupon, provided the Title Company omits such
returns as exceptions to title or provides affirmative coverage with respect to
those matters which are listed on Schedule "3", such returns shall not be deemed
an objection to title.
Section 7. The Note and Mortgage
7.1 The Note shall be in the form attached hereto as Exhibit
"A" and the Mortgage shall be in the form attached hereto as Exhibit "B".
Whether the Note and Mortgage shall be composed of a single note and mortgage or
a series of notes and mortgages shall be at Sellers' election in its sole and
absolute discretion, as shall be the decision of whether each such mortgage
shall cover one, all or some of the Properties.
7.2 In addition to delivery of the Note and Mortgage,
Purchaser shall execute, deliver and/or provide to Sellers the following in
connection with the Note and Mortgage and as conditions to Closing, all of which
shall be in form and substance to Sellers' satisfaction, in Sellers' sole and
absolute discretion:
(a) A Loan and Security agreement (the "Loan
Agreement") in the form of Exhibit "C" annexed hereto.
(b) A Hazardous Material Indemnification Agreement
issued by Purchaser to the Sellers in the form of Exhibit "D" annexed hereto.
(c) A mortgagee's title insurance policy or policies
in the amount of the Mortgages insuring the Mortgages issued by the Title
Company subject only to the Permitted Encumbrances (which shall include the
existing financing set forth on Schedule "3A"), and including such affirmative
insurance, endorsements and reinsurance agreements as are in effect with respect
to the existing financing.
(d) Such other instruments, documents, certificates
and other items which are required to be delivered to Sellers by the Mortgage
and Loan Agreement.
Section 8. Representations and Warranties
8.1 (a) Sellers represent and warrant to Purchaser as
follows:
(i) Each Seller is a duly formed and validly
existing limited partnership organized under the laws of the State of Delaware
and is qualified under the laws of the State where each Seller is required by
law to be qualified.
(ii) Sellers have the full legal right, power
and authority to execute and deliver this Agreement and all documents now or
hereafter to be executed by Sellers (or any of them) pursuant to this Agreement
(collectively, "Sellers' Documents"), to consummate the transaction contemplated
hereby, and to perform their obligations hereunder and under Sellers' Documents.
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(iii) This Agreement and Sellers' Documents do
not and will not contravene any provision of the partnership agreement of any of
the Sellers, any judgment, order, decree, writ or injunction issued against
Sellers (or any of them), or any provision of any laws or governmental
ordinances, rules, regulations, orders or requirements (collectively, "Laws")
applicable to Sellers (or any of them). The consummation of the transactions
contemplated hereby will not result in a breach or constitute a default or event
of default by Sellers (or any of them) under any agreement to which Sellers (or
any of them) or any of their assets are subject or bound and will not result in
a violation of any Laws applicable to Sellers (or any of them).
(iv) Sellers have not entered into any and, to
Sellers' knowledge, there are no, leases, licenses or other occupancy agreements
affecting any portion of the Properties (collectively, the "Leases") on the date
hereof, except for the Leases listed in Schedule "4" annexed hereto and made a
part hereof. Except as set forth in Schedule "4", there are no other material
written agreements with any of the tenants other than those included in the
Leases.
(v) Except as set forth on Schedule "5" there
are no pending actions, suits, proceedings or investigations to which Sellers
(or any of them) are (is) a party before any court or other governmental
authority with respect to the Properties or, to Sellers' knowledge, any other
pending actions, suits or proceeding against or with respect to the Properties.
(vi) To Sellers' knowledge, (a) all required
certificates of occupancy for the Properties have been issued, and (b) Sellers
have received no written notice that any of the certificates of occupancy have
been suspended or revoked or will not be renewed.
(vii) To Sellers' knowledge, there are no
pending assessment or assessments due and payable prior or subsequent to Closing
other than as reflected in Purchaser's fee title insurance policy.
(viii) Attached hereto as Schedule "6" (the
"Rent Roll") is a true, complete and accurate listing of (I) the rental amounts
being billed on the date appearing on the Rent Roll by the property manager,
which rents are the rents currently being collected except to the extent of
arrearages as shown, (II) the rental arrearages for each of the tenants as of
the date indicated on the Rent Roll and (III) the security deposits plus accrued
interest being held by Sellers.
(ix) Sellers have no knowledge of any offset,
defense, claim, or counterclaim to payment of the rents currently being
collected and, except as set forth in Schedule "7" and the Rent Roll, Sellers
have not granted any abatements or concessions to rent under the Leases and, to
Sellers' knowledge, Sellers' predecessor did not grant any abatements or
concessions to rent or allowances which are currently or will be in the future
in effect.
(x) To Sellers' actual knowledge (without the
limitation that knowledge be limited to the person(s) described at the end of
this Section 8.1(a)), Sellers own the fee simple title to the Properties, it
being understood and agreed that notwithstanding such representation and
warranty, Sellers, except as otherwise set forth in this Agreement, are
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conveying the Properties to Purchaser without representation, warranty or
recourse as to the state of title.
(xi) Except as set forth in the Leases,
Sellers have not granted and, to Sellers' knowledge, none of the Properties are
subject to, (I) any option or right of first refusal pursuant to which any other
party has any right to purchase or lease any interest in the Properties or (II)
any extension, renewal, expansion or cancellation option with respect to the
Leases.
(xii) To Sellers' knowledge, none of the
tenants are subject to a bankruptcy filing other than those listed on Schedule
"8" annexed hereto and made a part hereof.
(xiii) There are no employees employed by
Sellers at the Properties.
(xiv) Except as set forth in Schedule "9",
Sellers have not entered into any, and, to Sellers' knowledge, there are no
material service contracts, including brokerage and management agreements,
benefiting or burdening the Properties (collectively, the "Contracts") on the
date hereof. Except as set forth in Schedule 9, there are no leasing commissions
due or payable in respect of the Leases. True and complete copies of the
Contracts have been delivered to Purchaser to the extent that such Contracts
were entered into during Sellers' period of ownership and, to Sellers'
knowledge, true and complete copies of the Contracts have been delivered to
Purchaser to the extent that such Contracts were entered into during Sellers'
predecessors periods of ownership. Except as set forth in Schedule "10", Sellers
have neither given nor received any written notice of default under the
Contracts and Sellers have no knowledge of any material defaults under any such
Contracts.
(xv) To Sellers' knowledge, Sellers have
received no written notice that any of the tenants intend to vacate the
Properties other than those listed on Schedule "11" annexed hereto and made a
part hereof.
(xvi) There are no condemnation proceedings
pending against all or part of the Properties and Sellers have not received any
written notice of any threatened condemnation of all or part of the Properties.
(xvii) Except as set forth in Schedule "12",
Sellers have neither given nor received any written notices of default under the
Leases and Sellers have no knowledge of any monetary default or of any
nonmonetary default (other than of a de minimus nature) under the Leases.
(xviii) True and complete copies of the Leases,
to the extent that such Leases were entered into during Sellers' period of
ownership, have been delivered to Purchaser and, to Sellers' knowledge, true and
complete copies of the Leases, to the extent that such Leases were entered into
during Sellers' predecessors periods of ownership, have been delivered to
Purchaser.
(xix) Attached hereto as Schedule "13" is a
listing of the casualty insurance which Sellers currently maintain for the
Properties (the "Insurance"). To Sellers' knowledge, the Insurance is in full
force and effect and Sellers have received no written notice of termination of
the Insurance.
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(xx) Sellers have delivered to Purchaser
copies of the environmental and engineering reports listed on Schedule "14"
attached hereto (collectively, "Sellers' Reports").
(xxi) Sellers have received no written notice
that the Properties violate any federal, state or local law other than those
violations, if any, reflected in Sellers' Reports and in Purchaser's
environmental and engineering reports delivered to Sellers and listed on
attached Schedule "14" (collectively, "Purchaser's Reports").
(xxii) Except as set forth on Schedule "15",
there are no tax certiorari proceedings pending with respect to the Properties.
(xxiii) Sellers have not received any written
notice by any governmental authority or the United States government or any
other party during Sellers' period of ownership that the Properties violate any
Environmental Laws (as defined below) other than as reflected in Purchaser's
Reports and Sellers' Reports. The term "Environmental Laws" shall mean all
statutes specifically described in the immediately following sentence and all
applicable federal, state and local environmental health and safety statutes,
ordinances, codes, rules, regulations, orders and decrees regulating, relating
to or imposing liability or standards concerning or in connection with Hazardous
Materials (as defined below). The term "Hazardous Materials" shall mean with
respect to any Property any substance, material, waste, gas or particulate
matter which is regulated by any local governmental authority where the
applicable Property is located, the State where the applicable Property is
located, or the United States Government, including any material or substance
which is (i) defined as a "hazardous waste," "hazardous material," "hazardous
substance," "extremely hazardous waste," or "restricted hazardous waste" under
any provision of applicable state or local law, (ii) petroleum, (iii) asbestos,
(iv) polychlorinated biphenyl, (v) radioactive material, (vi) designated as a
"hazardous substance" pursuant to Section 311 of the Clean ▇▇▇▇▇ ▇▇▇, ▇▇ ▇.▇.▇.
▇▇▇▇ et seq. (33 U.S.C. Section 1317), (vii) defined as a "hazardous waste"
pursuant to Section 1004 of the Resource Conservation and Recovery Act, 42
U.S.C. Section 6901 et seq. (42 U.S.C. Section 6903), or (viii) defined as a
"hazardous substance" pursuant to Section 101 of the Comprehensive Environmental
Response, Compensation, and Liability Act, 42 U.S.C. Section 9601 et seq. (42
U.S.C. Section 9601).
The Leases and certain other Property Information (as hereinafter
defined) have been delivered or otherwise made available to Purchaser and, by
accepting the Deeds, Purchaser acknowledges its receipt and acceptance or the
availability to it thereof and that Purchaser has reviewed the same to its
satisfaction. To the extent the copies of the Leases delivered by Sellers to
Purchaser contain provisions or information that are inconsistent with the
information contained on the Schedule of Leases (attached as Schedule "4"), such
information shall be deemed modified to the extent necessary to eliminate such
inconsistencies and to conform the information contained in such Schedule to the
provisions or information set forth in the Leases. As used in this Agreement,
the words "Sellers' knowledge" or words of similar import shall be deemed to
mean, and shall be limited to, the actual (as distinguished from implied,
imputed or constructive) knowledge of Sellers after, and based solely upon,
making inquiry of ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ and ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, without
such persons having any obligation to make an independent inquiry or
investigation. Sellers represent that such persons are the individuals charged
with the responsibility for management of the Properties.
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(b) If at or prior to the Closing, (i) Purchaser
shall acquire actual knowledge (whether through its own efforts, by notice from
Sellers or otherwise) that any of the representations or warranties made herein
by Sellers are untrue, inaccurate or incorrect and shall give Sellers notice
thereof at or prior to the Closing, or (ii) Sellers shall notify Purchaser that
a representation or warranty made herein by Sellers is untrue, inaccurate or
incorrect, then (I) if such breach of representation or warranty results in a
Cost (as defined below) which would reduce net operating income for the Property
in an amount equal to or less than $18,000 for any Property, and such breach of
representation or warranty is not cured or corrected by Sellers on or before the
Closing Date then, Purchaser shall nevertheless be deemed to, and shall, waive
such misrepresentation or breach of warranty and shall consummate the
transactions contemplated hereby without any reduction of or credit against the
Purchase Price; (II) if such breach of representation or warranty results in a
Cost which would reduce the net operating income for the Property in an amount
greater than $18,000 but equal to or less than $100,000 for any Property and
such breach of representation or warranty is not cured or corrected by Sellers
on or before the Closing Date then Purchaser shall nevertheless be deemed to,
and shall, waive such misrepresentation or breach of warranty and shall
consummate the transactions contemplated hereby but with a reduction of or
credit against the Purchase Price in the amount equal to the First Percentage
(as hereinafter defined) of the Loss (as hereinafter defined) resulting
therefrom; and (III) if such breach of representation or warranty results in a
Cost which would reduce the net operating income for the Property in an amount
greater than $100,000 for any Property and such breach of representation or
warranty is not cured or corrected by Sellers on or before the Closing Date,
then Purchaser shall elect either (x) to waive such breach of representation or
warranty and consummate the transactions contemplated hereby but with a
reduction or credit against the Purchaser Price in the amount equal to the
Second Percentage (as hereinafter defined) of the Loss resulting therefrom, or
(y) to exclude the Property with such Cost from the sale and, in such event, the
Purchase Price shall be reduced by the allocated Purchase Price for such
Property (as set forth in Section 2.1(e) of this Agreement) (and the cash
portion of the Purchase Price and the principal amount of the Note and the
Mortgage shall be reduced pro rata), the definition of Properties shall not
include such Property and neither party shall have any further rights,
obligations or liabilities hereunder with respect to such Property, except as
otherwise set forth herein. "First Percentage" means the percentage determined
by dividing (A) the amount determined by subtracting $18,000 from the Cost by
(B) the Cost. "Second Percentage" means the percentage determined by dividing
(X) $82,000 by (Y) the Cost. Purchaser's "Cost" means the decrease in the net
operating income for any of the Properties caused by or resulting from or
arising out of the untruth, inaccuracy, or incorrectness of any of Sellers'
representations and warranties in this Agreement to the extent such decrease in
net operating income is not properly reimbursable by tenants. Purchaser's "Loss"
(i.e., the reduction in the net operating income from what such income would
have been had such representation or warranty not been untrue, inaccurate, or
incorrect), shall be calculated as follows: If such Cost would adversely affect
the calculation of net operating income only for the time period ending on the
first anniversary of the Closing Date, then Purchaser's Loss shall be the amount
that net operating income would be decreased as a result of such Cost; if such
Cost would adversely affect the calculation of net operating income only for one
12- month period ending after the first anniversary of the Closing Date, then
Purchaser's Loss shall be calculated by discounting such Cost at a 12% discount
rate and the Purchase Price will be reduced by the amount that net operating
income would be reduced as a result of such discounted Cost; if such Cost would
adversely affect the calculation of net operating income for the time period
ending after the first anniversary of the Closing Date and for more than one
12-month period after such first anniversary, then Purchaser's Loss shall be
calculated by capitalizing such Cost (at the rate of 10%) and Purchaser's Loss
shall be remedied in one of
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the following two manners, at Sellers' option: either (i) the Purchase Price
shall be reduced by the amount of such capitalized cost, or (ii) Purchaser and
Sellers shall enter into a Master Lease providing Purchaser the net operating
income that Purchaser would have received but for such Cost and on all other
terms reasonably acceptable to both Purchaser and Sellers. Purchaser
acknowledges and agrees that (i) at or prior to the Closing, Purchaser's rights
and remedies in the event any of Sellers' representations or warranties made in
this Agreement are untrue, inaccurate or incorrect shall be only as provided in
this Section 8.1(b), and (ii) if the Closing as to any Property or Properties
does not occur because of Purchaser's exclusion thereof, Purchaser hereby
expressly waives, relinquishes and releases all other rights or remedies
available to it at law, in equity or otherwise (including, without limitation,
the right to seek damages from Sellers) as a result of any of Sellers'
representations or warranties made in this Agreement being untrue, inaccurate or
incorrect as to such Property or Properties.
As used in this Agreement, the words "Purchaser's actual
knowledge" or words of similar import shall be deemed to mean, and shall be
limited to, the actual (as distinguished from implied, imported or constructive)
knowledge of Purchaser after, and based solely upon, making inquiry of
Purchaser's principal(s) and its counsel, without such person(s) having any
obligation to make an independent inquiry or investigation.
The provisions of this Section 8.1(b) shall survive the
Closing, except that the immediately following provisions shall survive the
Closing for only 180 days. Sellers and Purchaser agree that if the tenant
estoppels which Sellers distributed to certain tenants prior to Closing and the
estoppels that Purchaser will deliver to certain other tenants post-Closing show
offset rights or claims or defenses that would result in a Cost and which offset
rights or claims or defenses relate to the time period prior to Closing or
affect future rent obligations and both Sellers and Purchaser reasonably agree
in good faith that such offsets or claims or defenses are bona fide, then, in
such event, such agreed upon offsets and claims and defenses will be treated in
the same manner as a Cost. If the parties fail to agree on which offsets or
claims or defenses are bona fide and such disagreement continues for 60 days
then, in such event, the parties shall submit the dispute to the American
Arbitration Association ("AAA") or its successor for arbitration in the City of
New York in accordance with the rules and regulations for commercial matters.
The determination of the arbitrator shall be final and binding upon the parties.
All fees payable to the AAA and/or the arbitrator shall be divided evenly
between Purchaser and Sellers, and all other fees and expenses incurred by
Sellers in connection with the resolution of such dispute shall be paid for by
Sellers and all other fees and expenses incurred by Purchaser in connection with
the resolution of such dispute shall be paid for by Purchaser.
(c) In the event the Closing occurs:
(i) Notwithstanding anything contained in
Section 8.1(b) or elsewhere in this Agreement to the contrary (except in the
case or cases where Purchaser notified Sellers or Sellers notified Purchaser in
writing prior to Closing of any untrue, inaccurate or incorrect information,
representation or warranty and Purchaser either elected or was required to
close, in which case or cases the remedies of Section 8.1(b) shall apply),
Purchaser hereby expressly waives, relinquishes and releases any right or remedy
available to it at law, in equity or under this Agreement to make a claim
against Sellers for damages that Purchaser may incur, or to rescind this
Agreement and the transactions contemplated hereby, as the result of any of
Sellers' representations or warranties being untrue, inaccurate or incorrect if
(A) Purchaser had actual knowledge that such representation or warranty was
untrue, inaccurate or incorrect at the time of the Closing and Purchaser
nevertheless closes
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title hereunder, or (B) Purchaser's Loss as a result of such representation or
warranty being untrue, inaccurate or incorrect is less than $150,000 in the
aggregate.
(ii) Notwithstanding anything contained herein
to the contrary, if the Closing shall have occurred and to the extent Purchaser
shall not under the immediately preceding subparagraph (i) have waived,
relinquished and released all rights or remedies available to it at law, in
equity or otherwise as provided hereunder, the aggregate liability of Sellers to
Purchaser for Purchaser's Loss by reason or as a result of the untruth,
inaccuracy, or incorrectness of any of the representations and warranties of
Sellers in this Agreement and/or by reason of any bona fide (as agreed to
between Sellers and Purchaser or as determined by an Arbitrator as aforesaid)
tenant offset rights, claims, or defenses disclosed in tenant estoppel letters
delivered after the date hereof shall not exceed $5,000,000.
(iii) The representations and warranties of
Sellers set forth in Section 8.1(a) and elsewhere in this Agreement shall be
true, accurate and correct in all material respects upon the execution of this
Agreement and shall be deemed to be repeated on and as of the Closing Date
(except as they relate only to an earlier date). The representations and
warranties (whether express or implied) of Sellers set forth in Section 8.1(a)
and elsewhere in this Agreement and/or the Sellers' Documents (including the
Deeds and the Assignment Agreement) shall remain operative and shall survive the
Closing and the execution and delivery of the Deed for a period of one hundred
eighty (180) days following the Closing Date (except for the representations and
warranties of Sellers set forth in Section 8.1(a)(i), (ii) and (iii) which shall
survive without limitation except as provided by statute of limitation periods),
and no action or claim based thereon shall be commenced or submitted after such
period and any attempt to do so shall be null and void.
8.2 (a) Purchaser represents and warrants to Sellers as
follows:
(i) Purchaser is a duly formed and validly
existing corporation organized under the laws of the State of New York and is in
good standing under the laws of the State where each of the Sellers is required
by law to be qualified.
(ii) Purchaser has the full legal right,
power, authority and financial ability to execute and deliver this Agreement and
all documents now or hereafter to be executed by it pursuant to this Agreement
(collectively, the "Purchaser's Documents"), to consummate the transactions
contemplated hereby, and to perform its obligations hereunder and under
Purchaser's Documents.
(iii) This Agreement and Purchaser's Documents
do not and will not contravene any provision of the Certificate of Incorporation
or the By-Laws of Purchaser, any judgment, order, decree, writ or injunction
issued against Purchaser, or any provision of any Laws applicable to Purchaser.
The consummation of the transactions contemplated hereby will not result in a
breach or constitute a default or event of default by Purchaser under any
agreement to which Purchaser or any of its assets are subject or bound and will
not result in a violation of any Laws applicable to Purchaser.
(iv) There are no pending actions, suits,
proceedings or investigations to which Purchaser is a party before any court or
other governmental authority which may have an adverse impact on Purchaser's
ability to consummate the transactions contemplated hereby.
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(b) The representations and warranties of Purchaser
set forth in Section 8.2(a) and elsewhere in this Agreement shall be true,
accurate and correct in all material respects upon the execution of this
Agreement, shall be deemed to be repeated on and as of the Closing Date (except
as they relate only to an earlier date) and shall survive the Closing without
limitation except for statutory limitation periods.
Section 9. Costs of Transaction
Sellers shall be responsible for (a) Sellers' legal fees
attributable to the transfer of the Properties to, and the financing of the
Properties for, Purchaser (including preparation and negotiation of this
Agreement and the consummation of the transactions contemplated herein), (b)
Purchaser's fee title insurance premiums, fees and expenses and the Cost of
customary affirmative insurance and endorsements for the state in which the
Property is located and (c) any transfer or sales taxes imposed by the states
where each of the Properties is located in connection with the transfer of the
Property to Purchaser. Purchaser shall be responsible for (a) mortgagee's title
insurance premiums, fees and expenses and the cost of affirmative insurance and
endorsements for the state in which the Property is located as required herein,
(b) engineering, inspection, preparation of due diligence reports and other due
diligence expenses, (c) recording fees (exclusive of transfer taxes), and (d)
Purchaser's legal fees attributable to the acquisition of the Properties, and
the financing of the Properties, from Sellers, including all costs and expenses
required to be paid by Purchaser, as borrower, in the Loan Agreement.
Section 10. Conditions Precedent to Closing
10.1 Purchaser's obligation under this Agreement to purchase
the Properties is subject to the fulfillment of each of the following
conditions, subject, however, to the provisions of Section 10.3:
(a) The representations and warranties of Sellers
contained herein shall be materially true, accurate and correct as of the
Closing Date except to the extent they relate only to an earlier date (subject
to the provisions of Section 8.1(b));
(b) Sellers shall be ready, willing and able to
deliver title to the Properties in accordance with the terms and conditions of
this Agreement;
(c) The Title Company is ready, willing and able to
issue fee title insurance to Purchaser in accordance with the terms and
conditions of this Agreement at the Title Company's standard rates; and
(d) Sellers shall have delivered all the documents
and other items required pursuant to Section 11, and shall have performed all
other covenants, undertakings and obligations, and complied with all conditions
required by this Agreement to be performed or complied with by the Sellers at or
prior to the Closing.
10.2 Sellers' obligation under this Agreement to sell the
Properties to Purchaser is subject to the fulfillment of each of the following
conditions, subject, however to the provisions of Section 10.3:
(a) the representations and warranties of Purchaser
contained herein shall be materially true, accurate and correct as of the
Closing Date;
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(b) Purchaser shall have delivered to Sellers the
funds required hereunder;
(c) Purchaser shall have executed and delivered to
Sellers the Note, the Mortgage and all other documents required by Section 7
and/or the Note and the Mortgage;
(d) Purchaser shall have delivered to Sellers all the
documents to be executed by Purchaser set forth in Section 12 and shall have
performed all other covenants, undertakings and obligations, and complied with
all conditions required by this Agreement to be performed or complied with by
Purchaser at or prior to the Closing;
(e) On or prior to Closing Date, (i) Purchaser shall
not have applied for or consented to the appointment of a receiver, trustee or
liquidator for itself or any of its assets unless the same shall have been
discharged prior to the Closing Date, and no such receiver, liquidator or
trustee shall have otherwise been appointed, unless same shall have been
discharged prior to the Closing Date, (ii) Purchaser shall not have admitted in
writing an inability to pay its debts as they mature, (iii) Purchaser shall not
have made a general assignment for the benefit of creditors, (iv) Purchaser
shall not have been adjudicated a bankrupt or insolvent, or had a petition for
reorganization granted with respect to Purchaser, or (v) Purchaser shall not
have filed a voluntary petition seeking reorganization or an arrangement with
creditors or taken advantage of any bankruptcy, reorganization, insolvency,
readjustment or debt, dissolution or liquidation law or statute, or filed an
answer admitting the material allegations of a petition filed against it in any
proceedings under any such law, or had any petition filed against it in any
proceeding under any of the foregoing laws unless the same shall have been
dismissed, canceled or terminated prior to the Closing Date; and
10.3 (a) In the event that any condition contained in
Section 10.1 is not satisfied, subject to Section 6.1(b), Section 6.2, Section
8.1(b), Section 16.1, Section 16.2 and Section 17.1, Purchaser shall have as its
sole remedy hereunder the right to elect to (a) waive such unsatisfied condition
whereupon title shall close as provided in this Agreement or (b) exclude the
Property which fails to satisfy the condition in Section 10.1 from this sale
and, in such event, the Purchase Price shall be reduced by the allocated
Purchase Price for such Property (as set forth in Section 2.1 (e) of this
Agreement) (and the cash portion of the Purchase Price and the principal amount
of the Note and the Mortgage shall be reduced pro rata), the definition of
Properties shall not include such Property and neither party shall have any
further rights, obligations or liabilities hereunder with respect to such
Property, except as otherwise set forth herein.
(b) In the event that any condition in Section 10.2
is not satisfied, sellers shall have as their sole remedy hereunder the right to
elect either (a) to waive such unsatisfied condition whereupon title shall close
as provided in this Agreement or (b) terminate this Agreement and retain or
recover the Downpayment as liquidated damages and neither party shall have any
further rights, obligations or liabilities hereunder, except as otherwise set
forth herein and except that Purchaser shall be entitled to a return of the Fund
subject to Section 24 with respect to such Property.
(c) Nothing contained in this Section 10.3 shall be
construed so as to grant any party any right to terminate this Agreement in
whole or in part or the right to exclude any Property from this sale unless such
party is expressly entitled to such right hereunder.
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Section 11. Documents to be Delivered by Sellers at Closing
11.1 At the Closing, each Seller shall execute, acknowledge
and/or deliver (or cause to be delivered), as applicable, the following to
Purchaser or the Title Company:
(a) A special warranty deed (collectively the
"Deeds") conveying title to the Property owned by each such Seller in the form
of Exhibit "E" annexed hereto and made a part hereof, but with such changes as
are required by the laws of the applicable jurisdiction.
(b) An Assignment and Assumption of Leases and
Security Deposits in the form of Exhibit "F" annexed hereto and made a part
hereof assigning without warranty or representation each such Seller's right,
title and interest in and to the Leases, all guarantees thereof and the security
deposits thereunder in each such Seller's possession (the "Lease Assignment").
(c) An Assignment and Assumption of Contracts,
Licenses and Building Plans in the form of Exhibit "G" annexed hereto and made a
part hereof (the "Contract and License Assignment") assigning each such Seller's
right, title and interest in and to (i) all of the assignable licenses, permits,
certificates, approvals, authorizations and variances issued for or with respect
to each such Seller's Property by any governmental authority (collectively, the
"Licenses") (ii) all assignable purchase orders, equipment leases, advertising
agreements, franchise agreements, license agreements, management agreements,
leasing and brokerage agreements and other service contracts relating to the
operation of each such Seller's Property to the extent Purchaser has agreed to
assume same and (iii) all building plans and specifications and guarantees and
warrantees for any real or personal property being transferred pursuant to this
Agreement.
(d) The Assignment and Assumption of Intangible
Property in the form of Exhibit "H" annexed hereto and made part hereof
assigning all of Seller's right, title and interest, if any, in and to all
intangible property owned by each such Seller with respect to the operation of
the Properties listed on Schedule "16" annexed hereto and made a part hereof,
including any trade name for the Properties (the "Intangible Property
Assignment") (the Lease Assignment, the Contract and License Assignment and the
Intangible Property Assignment are herein referred to collectively as the
"Assignment Agreement").
(e) A good, unendorsed certified or official bank
check drawn on or by a Clearing House Bank payable to the order of Purchaser, or
a credit to Purchaser against the Purchase Price, in the aggregate amount of
such security deposits and accrued interest thereon payable to tenants which are
in the possession of or received by each such Seller. With respect to any lease
securities which are other than cash, each such Seller shall execute and deliver
to Purchaser at the Closing or thereafter on request of Purchaser any
appropriate instruments of assignment or transfer (and Sellers shall pay or
credit Purchaser for any necessary transfer fees in connection therewith)
without warranty or representation that such security may be converted to cash.
(f) A ▇▇▇▇ of sale in the form of Exhibit "I" annexed
hereto and made a part hereof (the "▇▇▇▇ of Sale") conveying, transferring and
selling to Purchaser all right, title and interest of each such Seller in and to
all Personal Property (it is agreed that no portion of the Purchase Price has
been allocated to, or is otherwise attributable to, the Personal Property).
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(g) Notices to the tenants of the Properties in the
form of Exhibit "J" annexed hereto and made a part hereof advising the tenants
of the sale of the Properties to Purchaser and directing that rents and other
payments thereafter be sent to Purchaser or as Purchaser may direct.
(h) Copies of the resolutions of the general partner
of each Seller authorizing the execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated by this
Agreement to be undertaken by such Seller certified as true and correct by the
Secretary or Assistant Secretary of such Seller.
(i) Possession of the Properties, subject only to the
Permitted Encumbrances, Leases and any Unacceptable Encumbrances waived in
writing by Purchaser; and, to the extent in Sellers' possession and not already
located at the Properties, keys to all entrance doors to, and equipment and
utility rooms located in, the Properties.
(j) To the extent in Sellers' possession and not
already located at the Properties, all Licenses.
(k) The Transfer Tax Returns, if any.
(l) A "FIRPTA" affidavit sworn to by Sellers in the
form of Exhibit "K" annexed hereto and made a part hereof. Purchaser
acknowledges and agrees that upon Sellers' delivery of such affidavits,
Purchaser shall not withhold any portion of the Purchase Price pursuant to
Section 1445 of the Internal Revenue Code of 1986, as amended, and the
regulations promulgated thereunder.
(m) All files, records, plans and specifications in
Sellers' possession relating to the construction, maintenance, operation and
leasing of the Properties and not previously delivered to Purchaser.
(n) An affidavit that from and after the date each
such Seller acquired its Property that there has been no change to the
"footprint" of the improvements on such Property other than those set forth on a
schedule attached to such affidavit. If the most recent survey for each Property
is dated prior to the date of each Seller's acquisition thereof, then an
affidavit to recite to each Seller's knowledge that no changes (other than those
set forth on an attached schedule) were made to the "footprint" of the
improvements on the Properties between the date of such survey and the date of
Seller's acquisition.
(o) Estoppel certificates in the form attached hereto
from tenants listed on Schedule "17" attached hereto and made a part hereof;
provided, however, that failure of Sellers to obtain the estoppels in the form
attached hereto or otherwise shall not be a default hereunder.
(p) The Management Agreement.
(q) Copies of the Leases and, to the extent in
Sellers' possession, original, executed counterparts of such Lease.
(r) Copies of the Contracts which Purchaser agrees to
assume (and to the extent in Sellers' possession, originals of such Contracts).
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(s) ▇▇▇▇▇ Environmental Indemnity re: Nebraska.
(t) ▇▇▇▇▇ Indemnity re: Consents.
(u) ▇▇▇▇▇ Indemnity re: Financing Document
Discrepancies.
(v) Repair and Replacement Agreement.
(w) All other documents Sellers are required to
deliver pursuant to the provisions of this Agreement.
11.2 To the extent that the copies of the Leases delivered to
Purchaser pursuant to Section 11.1(q) were not executed counterparts, Sellers,
on or before 60 days after the Closing, shall deliver to Purchaser (i) for each
such Lease that it entered into, a certificate duly acknowledged, representing
that the applicable Seller has been unable to locate the original and that
annexed is a true and complete copy, and (ii) for each such Lease that the
applicable Seller's predecessor entered into, a certificate, duly acknowledged,
representing to such Seller's knowledge, that such Seller has been unable to
locate the original and that annexed is a true and complete copy.
Section 12. Documents to be Delivered by Purchaser at Closing
12.1 At the Closing, Purchaser shall execute, acknowledge
and/or deliver, as applicable, the following to Sellers:
(a) The cash portion of the Purchase Price payable at
the Closing pursuant to Section 2(c), subject to apportionments, credits and
adjustments as provided in this Agreement.
(b) The Note and Mortgage and all other documents
required by Section 12 and/or by the terms of the Mortgage or the Loan
Agreement.
(c) The Bills of Sale.
(d) If Purchaser is a corporation, (i) copies of the
certificate of incorporation and by-laws of Purchaser and of the resolutions of
the board of directors of Purchaser authorizing the execution, delivery and
performance of this Agreement and the consummation of the transactions
contemplated by this Agreement certified as true and correct by the Secretary or
Assistant Secretary of Purchaser; (ii) a good standing certificate issued by the
state of incorporation of Purchaser, dated within thirty (30) days of the
Closing Date; (iii) a good standing certificate issued in all jurisdictions
where Purchaser is required by law to be in good standing in order to hold title
to a Property, dated within thirty (30) days of the Closing Date; and (iv) an
incumbency certificate executed by the Secretary or Assistant Secretary of
Purchaser with respect to those officers of Purchaser executing any documents or
instruments in connection with the transactions contemplated herein.
(e) The Assignment Agreement.
(f) The Transfer Tax Returns, if any.
(g) The Management Agreement.
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(h) All other documents Purchaser is required to
deliver pursuant to the provisions of this Agreement.
Section 13. Operation of the Properties
13.1 Between the date hereof and the Closing Date, Sellers
agree to continue to operate and manage the Properties in substantially the same
manner as they did prior to the execution and delivery of this Agreement
including preserving the good will of all suppliers and tenants. In connection
therewith:
(a) (i) Sellers may not modify, extend, renew,
cancel, terminate or permit the expiration of any Lease or enter into any
proposed Lease of all or any portion of the Properties without Purchaser's
consent, and if such consent is requested, such consent shall not be
unreasonably withheld and shall be given or denied, with the reasons for any
such denial, within the applicable period specified in Section 13.1(a)(iv).
(ii) If Sellers enter into any permitted new
Leases, or if there is any permitted extension or renewal of any Leases, whether
or not such Leases provide for their extension or renewal, or any expansion or
modification of any Leases (each, a "New Lease"), Sellers shall keep accurate
records of all expenses (collectively, "New Lease Expenses") incurred in
connection with each New Lease, including, without limitation, the following:
(A) brokerage commissions and fees relating to such leasing transaction, (B)
expenses incurred for repairs, improvements, equipment, painting, decorating,
partitioning and other items to satisfy the tenant's requirements with regard to
such leasing transaction, (C) the cost of removal and/or abatement of asbestos
or other hazardous or toxic substances located in the demised space, (D)
reimbursements to the tenant for the cost of any of the items described in the
preceding clauses (B) and (C), (E) legal fees for services in connection with
the preparation of documents and other services rendered in connection with the
effectuation of the leasing transaction, (F) rent concessions relating to the
demised space provided the tenant has the right to take possession of such
demised space during the period of such rent concessions, and (G) expenses
incurred for the purpose of satisfying or terminating the obligations of a
tenant under a New Lease to the landlord under another lease (whether or not
such other lease covers space in the Properties).
(iii) The New Lease Expenses for each New Lease
allocable to and payable by Sellers shall be determined by multiplying the
amount of such New Lease Expenses by a fraction, the numerator of which shall be
the number of days contained in that portion, if any, of the term of such New
Lease commencing on the date on which the tenant thereunder shall have commenced
to pay fixed rent ("Rent Commencement Date") and expiring on the date
immediately preceding the Closing Date, and the denominator of which shall be
the total number of days contained in the period commencing on the Rent
Commencement Date and expiring on the date of the scheduled expiration of the
term of such New Lease, and the remaining balance of the New Lease Expenses for
each New Lease shall be allocable to and payable by Purchaser. For purposes of
this Section 13.1(a)(iii), the Rent Commencement Date under a renewal,
extension, expansion or modification of a Lease shall be deemed to be (A) in the
case of a renewal or extension (whether effective prior to or after the Closing,
or in the form of an option exercisable in the future), the first date during
such renewal or extension period after the originally scheduled expiration of
the term of such Lease on which the tenant under such Lease commences to pay
fixed rent, (B) in the case of an expansion (whether effective prior to or after
the Closing, or in the form of an option exercisable in the future), the date on
which the tenant under such Lease commences to pay
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fixed rent for the additional space, and (C) in the case of a modification not
also involving a renewal, extension or expansion of such Lease, the effective
date of such modification agreement. At the Closing, Purchaser shall reimburse
Sellers for all New Lease Expenses theretofore paid by Sellers, if any, in
excess of the portion of the New Lease Expenses allocated to Sellers pursuant to
the provisions of the preceding sentence. The provisions of this Section
13.1(a)(iii) shall survive the Closing.
(iv) With respect to any request for consent
by Sellers to be submitted to Purchaser for its consent pursuant to Section
13.1(a)(i) (which consent shall be accompanied by related term sheets and other
supporting information in reasonable detail relating to the requested action),
Purchaser shall consent or deny its consent, with the reasons for any such
denial, within the following ten (10) business days. If notice of any denied
consent is not received, Purchaser's consent shall be deemed to have been
granted.
(b) Subject to obtaining Purchaser's required consent
under Section 13.1(a) (i), Sellers reserves the right, but are not obligated, to
institute summary proceedings against any tenant or terminate any Lease as a
result of a default by the tenant thereunder prior to the Closing Date. Sellers
make no representations and assumes no responsibility with respect to the
continued occupancy of the Properties or any part thereof by any tenant. The
permitted removal of a tenant whether by summary proceedings or otherwise prior
to the Closing Date shall not give rise to any claim on the part of Purchaser.
Further, Purchaser agrees that it shall not be grounds for Purchaser's refusal
to close this transaction that any tenant is a holdover tenant or in default
under its Lease on the Closing Date and Purchaser shall accept title subject to
such holding over or default without credit against, or reduction of, the
Purchase Price.
(c) Sellers shall not modify, extend, renew or cancel
(except as a result of a default by the other party thereunder) any Contracts,
or enter into any new Contract without Purchaser's prior consent in each
instance, which consent shall not be unreasonably withheld or delayed, and if
withheld, Purchaser shall promptly give Sellers a notice stating the reasons
therefor; provided, however, that Purchaser's consent shall not be required to
the aforestated actions with the exception of cancellation if such Contract may
be terminated at any time on not more than thirty (30) days' prior notice by
Sellers, or its successor, without the payment of a penalty.
(d) Sellers will keep in force and effect with
respect to the Properties the casualty insurance policies currently carried by
Sellers listed on Schedule "13" or policies providing similar coverage.
(e) From the date hereof until the Closing, Sellers
shall not withdraw, settle or otherwise compromise any protest or reduction
proceedings relating to the assessed valuation of the Properties for any tax
year subsequent to the tax year in which the Closing occurs or the tax year in
which the Closing occurs, without Purchaser's prior consent in each instance.
Seller shall, at Closing, assign to Purchaser, without representation, warranty
or recourse of any kind all of Sellers' right, title and interest (if any) in
and to any then pending protests or reduction proceedings relating to the
assessed valuation of the Properties for any fiscal tax year(s) in which the
Closing occurs or subsequent to the respective tax years in which the Closing
occurs, whereupon Purchaser shall be authorized to continue and control the
progress of, and to make all decisions with respect to, any such proceedings.
All net tax refunds and credits attributable to any tax year prior to the tax
year in which the Closing occurs shall belong to and be the property of Sellers.
All net tax refunds and credits attributable to any tax year subsequent to the
tax year in which the Closing occurs shall belong to and be the property of
Purchaser. All net tax
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refunds and credits attributable to the tax year in which the Closing occurs
shall be divided between Sellers and Purchaser in accordance with the
apportionment of taxes pursuant to the provisions of this Agreement, after
deducting therefrom a pro rata share of all expenses, including, without
limitation, counsel fees and disbursements and consultant's fees, incurred in
obtaining such refund, the allocation of such expenses to be based upon the
total refund obtained in such proceeding and in any other proceeding
simultaneously involved in the trial or settlement. Each party agrees to
cooperate reasonably with the other party in connection with the prosecution of
any such proceedings and to take all steps, whether before or after the Closing
Date, as may be necessary to carry out the intention of the foregoing,
including, without limitation, the delivery to the other party, upon demand, of
any relevant books and records, including receipted tax bills and canceled
checks used in payment of such taxes in possession or control of the requesting
party, the execution of any and all consents or other documents, and the
undertaking of any act reasonably necessary for the collection of such refund by
the requesting party. All tax refunds to be paid to either party after the
Closing as contemplated under this Section 13(e) shall be net of any amounts due
tenants at the Building on account of any such tax refunds, and Sellers and
Purchaser shall jointly determine such amount(s) (if any) due tenants and direct
the Sellers' tax protest or certiorari counsel to deduct such amounts from the
gross tax refund and forward the same to the appropriate tenant(s) prior to
making any payment to Sellers or Purchaser (as the case may be). The provisions
of this Section 13.1(e) shall survive the Closing.
13.2 With respect to the costs and expenses of work
(including tenant improvement work) performed or to be performed to leased space
which is to be either paid by landlord or reimbursed by landlord to tenants
pursuant to any Lease, (including any pending Lease provided same is entered
into) which is set forth on Schedule "7A" attached hereto, Sellers shall be
responsible for such work and agree to perform and/or complete such work, or to
cause such work to be performed and/or completed through Purchaser's manager
(i.e., Century Management Company) or replacement manager if Purchaser's current
manager is terminated, in accordance with the requirements of the applicable
Leases. With respect to the above-described work, Sellers, as to each Property,
shall carry insurance for liability, bodily and personal injury (including
death) and property damage and workers compensation in form and amounts
reasonably satisfactory to Purchaser. Sellers shall indemnify Purchaser for any
losses caused by Sellers' failure to complete such tenant improvement work in
accordance with such tenant's Lease and free of liens and all claims for unpaid
charges. Sellers shall also remain responsible for all brokerage and leasing
commissions relating to (A) the pending Leases described in Schedule "7A" and
(B) the Leases which are listed in Schedule "18", provided, however, Sellers
shall not be responsible for brokerage and leasing commissions for options,
extensions, renewals or expansions not exercised prior to the Closing Date. In
connection with Sellers performing the above-described work, Purchaser shall
reasonably cooperate with Sellers in providing Sellers with reasonable access to
the Properties for purpose of carrying out such work. With respect to the
above-described work, all such work shall be performed and completed in
compliance with applicable Lease requirements and without unreasonable
interference to the other tenants of the Properties (including their employees
and invitees) and free of liens and unpaid claims. Any liens resulting from such
work will be discharged by Sellers by payment or bonding with in 60 days unless
sooner action is necessary to avert lien foreclosure. The provisions of this
Section 13.2 shall survive Closing.
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13.3 Purchaser will in good faith review and determine
the manner of compliance with the obligations of Seller under that certain
Purchase Agreement, dated January 23, 1995, as amended, between AP II, as seller
and ▇▇▇▇▇▇ ▇. ▇▇▇▇, as purchaser to use best efforts to extend the reciprocal
cross-easement agreement referenced in Section 6 therein.
13.4 If the tenant known as ▇.▇. Penney for certain
vacant space located at Marysville Center Property fails to execute and deliver
a lease to Sellers, Purchaser or the Initial Manager (or replacement manager) on
or before _____________ on substantially the same terms as set forth above on
Schedule "19", then, in such event, Sellers shall as tenant master lease (the
"Master Lease") such premises from Purchaser on the terms and conditions set
forth on Schedule "19". The Master Lease shall terminate at such time as ▇.▇.
▇▇▇▇▇▇ or another tenant enters into a lease with Purchaser on substantially the
same terms and conditions set forth on Schedule "19". If Sellers enter into the
Master Lease, Purchaser and Purchaser's leasing agent shall use reasonable
efforts to lease the premises contemplated to be leased under the draft ▇.▇.
Penney lease to ▇.▇. ▇▇▇▇▇▇ or another tenant. In addition, Sellers shall have
the unilateral right to sublease some or all of such premises on reasonable
terms and conditions provided that the term is not longer than the term set
forth in Schedule "19".
Section 14. As Is
14.1 Purchaser expressly acknowledges and agrees to accept
title to the Properties on an "as-is-where-is and with all faults" basis except
as otherwise provided herein.
14.2 Except for separate agreement(s) entered in writing by
the parties hereto or their Affiliates contemporaneously herewith, this
Agreement, as written, contains all the terms of the agreement entered into
between the parties as of the date hereof, and Purchaser acknowledges, that
neither Sellers nor any of Sellers' Affiliates, nor any of their agents or
representatives, has made any representations or held out any inducements to
Purchaser, and Sellers hereby specifically disclaim any representation, oral or
written, past, present or future, other than those specifically set forth in
Section 8.1 and Section 15.1, or elsewhere herein. Without limiting the
generality of the foregoing, Purchaser has not relied on any representations or
warranties, and neither Sellers nor any of Sellers' Affiliates, nor any of their
agents or representatives has or is willing to make any representations or
warranties, express or implied, other than as may be expressly set forth herein,
as to (a) the status of title to the Properties, (b) the Leases, (c) the
Contracts, (d) the Licenses, (e) the current or future real estate tax
liability, assessment or valuation of the Properties; (f) the potential
qualification of the Properties for any and all benefits conferred by any Laws
whether for subsidies, special real estate tax treatment, insurance, mortgages
or any other benefits, whether similar or dissimilar to those enumerated; (g)
the compliance of the Properties in its current or any future state with
applicable Laws or any violations thereof, including, without limitation, those
relating to access for the handicapped, environmental or zoning matters, and the
ability to obtain a change in the zoning or a variance in respect to the
Properties' non-compliance, if any, with zoning Laws; (h) the nature and extent
of any right-of-way, lease, possession, lien, encumbrance, license, reservation,
condition or otherwise; (i) the availability of any financing for the purchase,
alteration, rehabilitation or operation of the Properties from any source,
including, without limitation, any government authority or any lender; (j) the
current or future use of the Properties; (k) the present and future condition
and operating state of any Personal Property and the present or future
structural and physical condition of the Buildings, their suitability for
rehabilitation or renovation, or the need for expenditures for capital
improvements, repairs or replacements thereto; (l) the viability or financial
condition of any tenant; (m) the status of the leasing market in which the
Properties is located; or (n) the actual or projected income or operating
expenses of the Properties.
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14.3 Purchaser acknowledges that Sellers has afforded
Purchaser the opportunity for full and complete investigations, examinations and
inspections of the Properties and all Property Information. Purchaser
acknowledges and agrees that (a) the Property Information delivered or made
available to Purchaser and Purchaser's Representatives by Sellers or Sellers'
Affiliates, or any of their agents or representatives may have been prepared by
third parties and may not be the work product of Sellers and/or any of Sellers'
Affiliates; (b) neither Sellers nor any of Sellers' Affiliates has made any
independent investigation or verification of, or has any knowledge of, the
accuracy or completeness of, the Property Information, except for those items
specifically covered by Sellers representations in Section 8; (c) except for
those items specifically referenced in the schedules in Section 8, the Property
Information delivered or made available to Purchaser and Purchaser's
Representatives is furnished to each of them at the request, and for the
convenience of, Purchaser; (d) Purchaser is relying solely on its own
investigations, examinations and inspections of the Properties and those of
Purchaser's Representatives and is not relying in any way on the Property
Information furnished by Sellers or any of Sellers' Affiliates, or any of their
agents or representatives (except those items specifically covered by Sellers
representations in Section 8); (e) Sellers expressly disclaims any
representations or warranties with respect to the accuracy or completeness of
the Property Information (except those items specifically covered by Sellers
representations in Section 8) and Purchaser releases Sellers and Sellers'
Affiliates, and their agents and representatives, from any and all liability
with respect thereto (except those items specifically covered by Sellers
representations in Section 8); and (f) any further distribution of the Property
Information is subject to Section 24.
14.4 Purchaser or anyone claiming by, through or under
Purchaser, hereby fully and irrevocably releases Sellers and Sellers'
Affiliates, and their agents and representatives, from any and all claims that
it may now have or hereafter acquire against Sellers or Sellers' Affiliates, or
their agents or representatives for any cost, loss, liability, damage, expense,
action or cause of action, whether foreseen or unforeseen, arising from or
related to any construction defects, construction errors or omissions on or in
the Properties, or any other construction related conditions (whether patent,
latent or otherwise) affecting the Properties, except for (a) claims against
Sellers based upon any representations, warranties, obligations or liabilities
of Sellers expressly provided in this Agreement and (b) obligations that Sellers
or their Affiliates have expressly retained or undertaken pursuant to separate
agreement(s) entered in writing by the parties hereto or their Affiliates
contemporaneously herewith. As a material covenant and condition of this
Agreement, Purchaser agrees that in the event of any such construction defects,
errors or omissions, or any other construction related conditions affecting the
Properties, Purchaser shall look solely to Sellers' predecessors in interest or
to such contractors and consultants as may have contracted for work in
connection with the Properties for any redress or relief, except for claims
against Sellers based upon any representations, warranties, obligations or
liabilities of Sellers expressly provided in this Agreement. Purchaser further
understands that some of Sellers' predecessors in interest or such contractors
and consultants may have filed petitions under the bankruptcy code and Purchaser
may have no remedy against such predecessors, contractors or consultants.
14.5 Purchaser acknowledges that it has inspected the
Properties, is acquainted with and accepts their condition, and has reviewed, to
the extent necessary in its discretion, all the Property Information. Sellers
shall not be liable or bound in any manner by any oral or written "setups" or
information pertaining to the Properties or the rents furnished by Sellers
(except as represented herein), Sellers' Affiliates, their agents or
representatives, any real estate broker, or other person.
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14.6 The provisions of this Section 14 shall survive the
termination of this Agreement and the Closing.
Section 15. Broker
15.1 Purchaser and Sellers represent and warrant to the other
that it or they, as the case may be, have not dealt with any broker in
connection with the Property and the transactions described herein. Each party
hereto agrees to indemnify, defend and hold the other harmless from and against
any and all claims, causes of action, losses, costs, expenses, damages or
liabilities, including reasonable attorneys' fees and disbursements, which the
other may sustain, incur or be exposed to, by reason of any claim or claims by
any broker, finder or other person, for fees, commissions or other compensation
arising out of the transactions contemplated in this Agreement if such claim or
claims are based in whole or in part on dealings or agreements with the
indemnifying party.
15.2 The obligations and representations and warranties
contained in this Section 15 shall survive the termination of this Agreement and
the Closing.
Section 16. Casualty; Condemnation
16.1 Damage or Destruction: If a "material" part (as
hereinafter defined) of any Property is damaged or destroyed by fire or other
casualty, Sellers shall notify Purchaser of such fact and, except as hereinafter
provided, Purchaser shall have the option to not include such Property in the
sale and, in such event, the Purchase Price shall be reduced by the allocated
Purchase Price for such Property (as set forth in Section 2.1(e) of this
Agreement), the definition of Properties shall not include such Property and
neither party shall have any further rights, obligations or liabilities
hereunder, except as otherwise set forth herein. If Purchaser elects to waive
its aforementioned option or there is damage to or destruction of an
"immaterial" part ("immaterial" is herein deemed to be any damage or destruction
which is not "material", as such term is hereinafter defined) of a Property,
Purchaser shall close title as provided in this Agreement and, at the Closing,
Sellers shall, unless Sellers has repaired such damage or destruction prior to
the Closing, (A) pay over to Purchaser the proceeds of any insurance collected
by Sellers less the amount of all costs incurred by Sellers in connection with
the repair of such damage or destruction, and (B) assign and transfer to
Purchaser all right, title and interest of Sellers in and to any uncollected
insurance proceeds which Sellers may be entitled to receive from such damage or
destruction (Sellers shall bear the cost of any applicable insurance
deductible). A "material" part of a Property shall be deemed to have been
damaged or destroyed if (a) the cost of repair or replacement shall be 2% or
more of the allocated Purchase Price of such Property, as such cost is
reasonably estimated by an independent engineer selected by Sellers and
reasonably approved by Purchaser, or (b) one or both of the two largest tenants
at the damaged Property irrevocably terminates or is entitled to terminate their
lease.
16.2 Condemnation: If, prior to the Closing Date, all or any
"significant" portion (as hereinafter defined) of any Property is taken by
eminent domain or condemnation (or is the subject of a pending taking which has
not been consummated), Sellers shall notify Purchaser of such fact and the
Purchaser shall have the option to not include such Property in the sale and, in
such event, the Purchase Price shall be reduced by the allocated Purchase Price
for such Property (as set forth in Section 2.1(e) of this Agreement), the
definition of Properties shall not include such Property and neither party shall
have any further rights, obligations or liabilities hereunder, except as
otherwise set forth herein. If Purchaser elects to waive its aforementioned
option, or if an "insignificant" portion ("insignificant" is herein deemed to be
any taking which
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is not "significant", as such term is herein defined) of a Property is taken by
eminent domain or condemnation, at the Closing Sellers shall assign and
turnover, and Purchaser shall be entitled to receive and keep, all awards or
other proceeds for such taking by eminent domain or condemnation. A
"significant" portion of a Property means (i) any portion of the shopping center
building, (ii) a portion of the parking areas if the taking thereof reduces the
remaining available number of parking spaces below the minimum legally required
or the minimum required by the leases of one or both of the two largest tenants,
or (iii) such taking materially interferes with ingress thereto or egress
therefrom.
16.3 Notwithstanding anything contained in Section 16.1 and
Section 16.2 to the contrary, if Purchaser elects not to exclude a Property from
the sale as provided in Section 16.1 or Section 16.2 and the insurance, eminent
domain or condemnation proceeds payable with respect to the Properties as a
result of any casualty or taking exceeds the Purchase Price, Sellers' obligation
to pay over to Purchaser those proceeds paid to Sellers prior to the Closing
shall be limited to the amount of the Purchase Price plus 50% of the remainder
of such proceeds (net of Sellers' reasonable costs and expenses in obtaining
such proceeds). To the extent that payment of all or any portion of such
proceeds does not occur prior to the Closing, the parties agree that Sellers
shall be entitled to such portion of the proceeds in excess of the Purchase
Price, which agreement shall survive the Closing.
16.4 If Purchaser elects to exclude a Property from this sale
pursuant to Section 16.1 or 16.2, neither party shall have any further rights,
obligations or liabilities hereunder with respect to such Property, except as
otherwise provided herein, and except that Purchaser shall be entitled to a
return of a portion of the Fund.
Section 17. Remedies
17.1 If the Closing of any Property fails to occur by reason
of Sellers' inability (subject to Section 6.2) to perform its obligations under
this Agreement, then Purchaser, as its sole remedy for such inability of
Sellers, may by notice to Sellers exclude such Property from this sale and, in
such event, the Purchase Price shall be reduced by the allocated Purchase Price
for such Property (as set forth in Section 2.1(a) of this Agreement) (and the
cash portion of the Purchase Price and the principal amount of the Note and the
Mortgage shall be reduced pro rata), the definition of Properties shall not
include such Property and neither party shall have any further rights,
liabilities or obligations with respect to such Property, except as set forth
herein. If Purchaser elects to terminate this Agreement, then this Agreement
shall be terminated and neither party shall have any further rights, obligations
or liabilities hereunder, except for the Surviving Obligations, and except that
Purchaser shall be entitled to a return of the Fund subject to Section 24.4 and
provided Purchaser is not otherwise in default hereunder. Except as set forth in
this Section 17.1, Purchaser hereby expressly waives, relinquishes and releases
any other right or remedy available to it at law, in equity or otherwise by
reason of Sellers' inability to perform its obligations hereunder.
17.2 If the Closing fails to occur by reason of Purchaser's
failure or refusal to perform its obligations hereunder, then Sellers sole
remedy shall be to terminate this Agreement by notice to Purchaser and to retain
or recover the Fund as liquidated damages for all loss, damage and expenses
suffered by Sellers, it being agreed that Sellers' damages are impossible to
ascertain, and neither party shall have any further rights, obligations or
liabilities hereunder except as otherwise set forth herein.
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17.3 If the Closing fails to occur by reason of Sellers'
failure or refusal to perform its obligations hereunder, then Purchaser, as its
sole remedy hereunder, may (a) terminate this Agreement by notice to Sellers or
(b) seek specific performance from Sellers. As a condition precedent to
Purchaser exercising any right it may have to bring an action for specific
performance as the result of Sellers' failure or refusal to perform its
obligations hereunder, Purchaser must commence such an action within ninety (90)
days after the occurrence of such default. Purchaser agrees that its failure to
timely commence such an action for specific performance within such ninety (90)
day period shall be deemed a waiver by it of its right to commence such an
action.
Section 18. Purchaser's Access to the Properties
18.1 Purchaser and Purchaser's Representatives shall have the
right to enter upon the Properties for the sole purpose of inspecting the
Properties and making surveys, soil borings, engineering tests and other
investigations, inspections and tests (collectively, "Investigations"), provided
(a) Purchaser shall give Sellers not less than five (5) days' prior notice
before the first such entry and one (1) day's prior notice before each
subsequent entry, (b) the first such notice shall include sufficient information
to permit Sellers to review the scope of the proposed Investigations, and (c)
neither Purchaser nor Purchaser's Representatives shall permit any borings,
drillings or samplings to be done on any of the Properties without Sellers'
prior written consent. Any entry upon the Properties and all Investigations
shall be during Sellers' normal business hours and at the sole risk and expense
of Purchaser and Purchaser's Representatives, and shall not unreasonably
interfere with the activities on or about the Properties of Sellers, its tenants
and their employees and invitees. Purchaser shall:
(a) promptly repair any damage to the Properties
resulting from any such Investigations and replace, refill and regrade any holes
made in, or excavations of, any portion of the Properties used for such
Investigations so that the Properties shall be in the same condition that it
existed in prior to such Investigations;
(b) fully comply with all Laws applicable to the
Investigations and all other activities undertaken in connection therewith;
(c) permit Sellers to have a representative present
during all Investigations undertaken hereunder;
(d) take all actions and implement all protections
necessary to ensure that all actions taken in connection with the
Investigations, and the equipment, materials, and substances generated, used or
brought onto the Properties pose no threat to the safety or health of persons or
the environment, and cause no damage to the Properties or other property of
Sellers or other persons;
(e) furnish to Sellers, at no cost or expense to
Sellers, copies of all surveys, soil test results, engineering, asbestos,
environmental and other studies and reports relating to the Investigations which
Purchaser shall obtain with respect to the Properties promptly after Purchaser's
receipt of same;
(f) maintain or cause to be maintained, at
Purchaser's expense, a policy of commercial general liability insurance, and
with a combined single limit of not less than $1,000,000 per occurrence for
bodily injury and property damage, automobile liability coverage including owned
and hired vehicles with a combined single limit of $1,000,000 per occurrence
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for bodily injury and property damage, and an excess umbrella liability policy
for bodily injury and property damage in the amount of $5,000,000, insuring
Purchaser and Sellers and Sellers' Affiliates, as additional insureds, against
any injuries or damages to persons or property that may result from or are
related to (i) Purchaser's and/or Purchaser's Representatives' entry upon the
Properties, (ii) any Investigations or other activities conducted thereon, and
(iii) any and all other activities undertaken by Purchaser and/or Purchaser's
Representatives, all of which insurance shall be on an "occurrence form" and
otherwise in such forms and with an insurance company reasonably acceptable to
Sellers, and deliver a copy of such insurance policy to Sellers prior to the
first entry on the Properties;
(g) not allow the Investigations or any and all other
activities undertaken by Purchaser or Purchaser's Representatives to result in
any liens, judgments or other encumbrances being filed or recorded against the
Properties, and Purchaser shall, at its sole cost and expense, promptly
discharge of record any such liens or encumbrances that are so filed or recorded
(including liens for services, labor or materials furnished); and
(h) indemnify Sellers and Sellers' Affiliates and
hold Sellers and Sellers' Affiliates harmless from and against any and all
claims, demands, causes of action, losses, damages, liabilities, costs and
expenses (including reasonable attorneys' fees and disbursements), suffered or
incurred by Sellers or any of Sellers' Affiliates and arising out of or in
connection with (i) Purchaser's and/or Purchaser's Representatives' entry upon
the Properties, (ii) any Investigations or other activities conducted thereon by
Purchaser or Purchaser's Representatives, (iii) any Liens or other encumbrances
filed or recorded against the Properties as a consequence of the Investigations
or any and all other activities undertaken by Purchaser or Purchaser's
Representatives, and/or (iv) any and all other activities undertaken by
Purchaser or Purchaser's Representatives with respect to the Properties.
18.2 The provisions of this Section 18 shall survive the
termination of this agreement and the Closing.
Section 19. Sellers' Indemnity
19.1 Sellers' Indemnity. Sellers shall indemnify and hold
Borrower harmless from and against all suits, actions, proceedings, damages,
losses, liabilities and expenses (including reasonable attorneys' fees and
disbursements) that may be instituted or asserted against or incurred by
Borrower in connection with the litigations set forth on Schedule "21",
provided, that, Sellers shall have the right to prosecute and defend the same
with counsel selected by Sellers. This Section 19.1 shall survive the closing.
Section 20. Escrow
20.1 Escrow Agent shall hold the Downpayment and all interest
accrued thereon, if any (collectively, the "Fund") in escrow and shall dispose
of the Fund only in accordance with the provisions of this Section 20.
20.2 Escrow Agent shall deliver the Fund to Sellers or
Purchaser, as the case may be, as follows:
(a) to Sellers, upon completion of the Closing; or
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(b) to Sellers, after receipt of Sellers' demand in
which Sellers certifies either that (i) Purchaser has defaulted under this
Agreement, or (ii) this Agreement has been otherwise terminated or canceled, and
Sellers is thereby entitled to receive the Fund; but Escrow Agent shall not
honor Sellers' demand until more than ten (10) days after Escrow Agent has given
a copy of Sellers' demand to Purchaser in accordance with Section 20.3(a), nor
thereafter if Escrow Agent receives a Notice of Objection from Purchaser within
such ten (10) day period; or
(c) to Purchaser, after receipt of Purchaser's demand
in which Purchaser certifies either that (i) Sellers has defaulted under this
Agreement, or (ii) this Agreement has been otherwise terminated or canceled, and
Purchaser is thereby entitled to receive the Fund; but Escrow Agent shall not
honor Purchaser's demand until more than ten (10) days after Escrow Agent has
given a copy of Purchaser's demand to Sellers in accordance with Section
20.3(a), nor thereafter if Escrow Agent receives a Notice of Objection from
Sellers within such ten (10) day period.
Upon delivery of the Fund, Escrow Agent shall be relieved of all liability
hereunder and with respect to the Fund. Escrow Agent shall deliver the Fund, at
the election of the party entitled to receive the same, by (i) a good,
unendorsed certified check of Escrow Agent payable to the order of such party,
(ii) an unendorsed official bank or cashier's check payable to the order of such
party, or (iii) a bank wire transfer of immediately available funds to an
account designated by such party.
20.3 (a) Upon receipt of a written demand from Sellers or
Purchaser under Section 20.2(b) or (c), Escrow Agent shall send a copy of such
demand to the other party. Within ten (10) days after the date of receiving
same, but not thereafter, the other party may object to delivery of the Fund to
the party making such demand by giving a notice of objection (a "Notice of
Objection") to Escrow Agent. After receiving a Notice of Objection, Escrow Agent
shall send a copy of such Notice of Objection to the party who made the demand;
and thereafter, in its sole and absolute discretion, Escrow Agent may elect
either (i) to continue to hold the Fund until Escrow Agent receives a written
agreement of Purchaser and Sellers directing the disbursement of the Fund, in
which event Escrow Agent shall disburse the Fund in accordance with such
agreement; and/or (ii) to take any and all actions as Escrow Agent deems
necessary or desirable, in its sole and absolute discretion, to discharge and
terminate its duties under this Agreement, including, without limitation,
depositing the Fund into any court of competent jurisdiction and bringing any
action of interpleader or any other proceeding; and/or (iii) in the event of any
litigation between Sellers and Purchaser, to deposit the Fund with the clerk of
the court in which such litigation is pending.
(b) If Escrow Agent is uncertain for any reason
whatsoever as to its duties or rights hereunder (and whether or not Escrow Agent
has received any written demand under Section 20.2(b) or (c), or Notice of
Objection under Section 20.3(a)), notwithstanding anything to the contrary
herein, Escrow Agent may hold and apply the Fund pursuant to Section 20.3(a)(i),
(ii) or (iii) and may decline to take any other action whatsoever. In the event
the Fund is deposited in a court by Escrow Agent pursuant to Section 20.3(a)(ii)
or (iii), Escrow Agent shall be entitled to rely upon the decision of such
court. In the event of any dispute whatsoever among the parties with respect to
disposition of the Fund, Purchaser and Sellers shall pay the reasonable
attorney's fees and costs incurred by Escrow Agent (which said parties shall
share equally, but for which said parties shall be jointly and severally liable)
for any litigation in which Escrow Agent is named as, or becomes, a party.
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20.4 Notwithstanding anything to the contrary in this
Agreement, within one (1) business day after the date of this Agreement, Escrow
Agent shall place the Downpayment in an Approved Investment. The interest, if
any, which accrues on such Approved Investment shall be deemed part of the Fund;
and Escrow Agent shall dispose of such interest as and with the Fund pursuant to
this Agreement. Escrow Agent may not commingle the Fund with any other funds
held by Escrow Agent. Escrow Agent may convert the Fund from the Approved
Investment into cash or a non-interest-bearing demand account at an Approved
Institution as follows:
(a) at any time within seven (7) days prior to the
Closing Date; or
(b) if the Closing Date is accelerated or extended,
at any time within seven (7) days prior to the accelerated or extended Closing
Date (provided, however, that Sellers and Purchaser shall give Escrow Agent
timely notice of any such acceleration or extension and that Escrow Agent may
hold the Fund in cash or a non-interest-bearing deposit account if Sellers and
Purchaser do not give Escrow Agent timely notice of any such adjournment).
20.5 As used herein, the term "Approved Investment" means (a)
any interest-bearing demand account or money market fund in Citibank, N.A.
located in the City of New York or in any other institution otherwise approved
by both Sellers and Purchaser (collectively, an "Approved Institution"), or (b)
any other investment approved by both Sellers and Purchaser. The rate of
interest or yield need not be the maximum available and deposits, withdrawals,
purchases, reinvestment of any matured investment and sales shall be made in the
sole discretion of Escrow Agent, which shall have no liability whatsoever
therefor. Discounts earned shall be deemed interest for the purpose hereof.
20.6 Escrow Agent shall have no duties or responsibilities
except those set forth herein, which the parties hereto agree are ministerial in
nature. Sellers and Purchaser acknowledge that Escrow Agent is serving without
compensation, solely as an accommodation to the parties hereto, and except for
Escrow Agent's own willful default, misconduct or gross negligence, Escrow Agent
shall have no liability of any kind whatsoever arising out of or in connection
with its activity as Escrow Agent. Sellers and Purchaser jointly and severally
agree to and do hereby indemnify and hold harmless Escrow Agent from all loss,
cost, claim, damage, liability, and expense (including reasonable attorney's
fees and disbursements whether paid to retained attorneys or representing the
fair value of legal services rendered to itself) which may be incurred by reason
of its acting as Escrow Agent provided the same is not the result of Escrow
Agent's willful default, misconduct or gross negligence. Escrow Agent may charge
against the Fund any amounts owed to it under the foregoing indemnity or may
withhold the delivery of the Fund as security for any unliquidated claim, or
both.
20.7 Any Notice of Objection, demand or other notice or
communication which may or must be sent, given or made under this Agreement to
or by Escrow Agent shall be sent in accordance with the provisions of Section
23.
20.8 Simultaneously with their execution and delivery of this
Agreement, Purchaser and Sellers shall furnish Escrow Agent with their true
Federal Taxpayer Identification Numbers so that Escrow Agent may file
appropriate income tax information returns with respect to any interest in the
Fund or other income from the Approved Investment. The party ultimately entitled
to any accrued interest in the Fund shall be the party responsible for the
payment of any tax due thereon.
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20.9 Sellers and Purchaser waive any claim of conflict of
interest by reason of Escrow Agent's actions in that capacity under this
Agreement. Purchaser hereby acknowledges that Escrow Agent is the attorney for
the Sellers, and agrees that Escrow Agent may represent Sellers in connection
with any and all matters, including without limitation, the transaction
contemplated by this Agreement and any litigation, including any action arising
out of this Agreement; provided that in no event shall Purchaser be responsible
for payment of any fees incidental to any such representation.
20.10 Any amendment of this Agreement which could alter or
otherwise affect Escrow Agent's obligations hereunder will not be effective
against or binding upon Escrow Agent without Escrow Agent's prior consent, which
consent may be withheld in Escrow Agent's sole and absolute discretion.
20.11 The provisions of this Section 20 shall survive the
termination of this Agreement and the Closing.
Section 21. Assignment
21.1 Purchaser shall not assign all or any portion of its
rights under this Agreement to any person or entity without the prior written
consent of Sellers, which consent may be withheld in Sellers sole and absolute
discretion. Any assignment or attempted assignment by Purchaser shall constitute
a default by Purchaser hereunder and shall be null and void.
Section 22. Access to Records
22.1 For a period of five (5) years subsequent to the Closing
Date, Sellers, Sellers' Affiliates and their employees, agents and
representatives shall be entitled to access during business hours to all
documents, books and records given to Purchaser by Sellers at the Closing for
tax and audit purposes, regulatory compliance, and cooperation with governmental
investigations upon reasonable prior notice to Purchaser, and shall have the
right, at its sole cost and expense, to make copies of such documents, books and
records to extent such records are still in Purchaser's possession.
Section 23. Notices
23.1 All notices, elections, consents, approvals, demands,
designations objections, requests or other communications which Sellers,
Purchaser or Escrow Agent may be required or desire to give pursuant to, under
or by virtue of this Agreement must be in writing and sent by (a) first class
U.S. certified or registered mail, return receipt requested, with postage
prepaid, (b) by depositing the same into the custody of a nationally recognized
overnight delivery service such as Federal Express Corporation, Airborne
Express, ▇▇▇▇▇ or Purolator; (c) by hand delivery with proof of service endorsed
thereon; or (d) by telecopier provided it is also delivered by express mail or
courier (within the next 2 business days). All such notices, elections,
consents, approvals, demands, objections, requests or other communications sent
in compliance with the provisions hereof shall be deemed given and received on
(i) the second business day following the date it is deposited in the U.S. mail,
(ii) the date it is delivered to the other party if sent by U.S. Express Mail,
overnight delivery or hand delivery or (iii) the date it is delivered to the
other party if sent by telecopier provided it is confirmed by express mail or
courier (for next business day delivery). from time to time either party may
designate another address or addresses for all purposes of this Agreement by a
notice given to all other parties in accordance with the provisions hereof. For
purposes of this Section 23.1, the addresses of the parties shall be as follows:
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If to Sellers:
c/o Apollo Real Estate Advisors, L.P.
1301 Avenue of the ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to Purchaser:
New Valley Corporation
▇▇▇ ▇.▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
c/▇ ▇▇▇▇▇▇ and ▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to Escrow Agent:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇, Esq.
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
23.2 Sellers, Purchaser or Escrow Agent may designate another
addressee or change its address for notices and other communications hereunder
by a notice given to the other parties in the manner provided in this Section
23.
23.3 Any notice or other communication hereunder given by any
Seller shall be deemed given by all Sellers.
23.4 Notices and other communications given by the attorneys,
respectively, for Sellers or Purchaser shall be deemed given by, respectively,
Sellers or Purchaser.
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Section 24. Property Information and Confidentiality
24.1 Purchaser agrees that, prior to the Closing, all
Property Information shall be kept strictly confidential and shall not, without
the prior consent of Sellers, be disclosed by Purchaser or Purchaser's
Representatives, in any manner whatsoever, in whole or in part, and will not be
used by Purchaser or Purchaser's Representatives, directly or indirectly, for
any purpose other than evaluating the Properties. Moreover, Purchaser agrees
that, prior to the Closing, the Property Information will be transmitted only to
Purchaser's Representatives who need to know the Property Information for the
purpose of evaluating the Properties, and who are informed by the Purchaser of
the confidential nature of the Property Information. The provisions of this
Section 24 shall in no event apply to Property Information which is a matter of
public record and shall not prevent Purchaser from complying with Laws or
subpoenas or order of any court, including, without limitation, governmental
regulatory, disclosure, tax and reporting requirements.
24.2 Purchaser and Sellers, for the benefit of each other,
hereby agree that between the date hereof and the Closing Date, they will not
release or cause or permit to be released any press notices, publicity (oral or
written) or advertising promotion relating to, or otherwise announce or disclose
or cause or permit to be announced or disclosed, in any manner whatsoever, the
terms, conditions or substance of this Agreement or the transactions
contemplated herein, without first obtaining the written consent of the other
party hereto. It is understood that the foregoing shall not preclude either
party from discussing the substance or any relevant details of the transactions
contemplated in this Agreement, subject to the terms of Section 24.1, with any
of its attorneys, accountants, professional consultants or potential lenders, as
the case may be, or prevent either party hereto from complying with Laws,
including, without limitation, governmental regulatory, disclosure, tax and
reporting requirements.
24.3 In the event this Agreement is terminated, Purchaser and
Purchaser's Representatives shall promptly deliver to Sellers all originals and
copies of the Property Information referred to in clause (a) of Section 24.5 in
the possession of Purchaser and Purchaser's Representatives.
24.4 As used in this Agreement, the term "Property
Information" shall mean (a) all information and documents in any way relating to
the Properties, the operation thereof or the sale thereof (including, without
limitation, Leases, Contracts and Licenses) furnished to, or otherwise made
available for review by, Purchaser or its directors, officers, employees,
affiliates, partners, brokers, agents or other representatives, including
attorneys, accountants, contractors, consultants, engineers and financial
advisors (collectively, "Purchaser's Representatives"), by Sellers or any of
Sellers' Affiliates, or their agents or representatives, including their
contractors, engineers, attorneys, accountants, consultants, brokers or
advisors, and (b) all analyses, compilations, data, studies, reports or other
information or documents prepared or obtained by Purchaser or Purchaser's
Representatives containing or based, in whole or in part, on the information or
documents described in the preceding clause (a), or the Investigations, or
otherwise reflecting their review or investigation of the Properties.
24.5 In addition to any other remedies available to Sellers,
Sellers shall have the right to seek equitable relief, including injunctive
relief or specific performance, against Purchaser or Purchaser's Representatives
in order to enforce the provisions of this Section 24.
24.6 The provisions of this Section 24 shall survive the
termination of this Agreement.
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Section 25. Miscellaneous
25.1 This Agreement shall not be altered, amended, changed,
waived, terminated or otherwise modified in any respect or particular, and no
consent or approval required pursuant to this Agreement shall be effective,
unless the same shall be in writing and signed by or on behalf of the party to
be charged.
25.2 This Agreement shall be binding upon and shall inure to
the benefit of the parties hereto and to their respective heirs, executors,
administrators, successors and permitted assigns.
25.3 All prior statements, understandings, representations
and agreements between the parties, oral or written, are superseded by and
merged in this Agreement, which alone fully and completely expresses the
agreement between them in connection with this transaction and which is entered
into after full investigation, neither party relying upon any statement,
understanding, representation or agreement made by the other not embodied in
this Agreement. This Agreement shall be given a fair and reasonable construction
in accordance with the intentions of the parties hereto, and without regard to
or aid of canons requiring construction against Sellers or the party drafting
this Agreement.
25.4 Except as otherwise expressly provided herein,
Purchaser's acceptance of the Deed shall be deemed a discharge of all of the
obligations of Sellers hereunder and all of Sellers' representations,
warranties, covenants and agreements herein shall merge in the documents and
agreements executed at the Closing and shall not survive the Closing.
25.5 A. Purchaser agrees that it does not have and will
not have any claims or causes of action against any disclosed or undisclosed
officer, director, employee, trustee, shareholder, partner, principal, parent,
subsidiary or other affiliate of Sellers, including Apollo Real Estate Advisors,
L.P. (collectively, "Sellers' Affiliates"), arising out of or in connection with
this Agreement or the transactions contemplated hereby, except for separate
agreements entered into contemporaneously. Except as set forth in paragraph B.
of this Section 25.5, Purchaser agrees to look solely to Sellers and its assets
for the satisfaction of any liability or obligation arising under this Agreement
or the transactions contemplated hereby, or for the performance of any of the
covenants, warranties or other agreements contained herein, and further agrees
not to ▇▇▇ or otherwise seek to enforce any personal obligation against any of
Sellers' Affiliates with respect to any matters arising out of or in connection
with this Agreement or the transactions contemplated hereby, except for separate
agreements entered into contemporaneously. Without limiting the generality of
the foregoing provisions of this Section 25.5, Purchaser hereby unconditionally
and irrevocably waives any and all claims and causes of action of any nature
whatsoever it may now or hereafter have against Sellers' Affiliates, and hereby
unconditionally and irrevocably releases and discharges Sellers' Affiliates from
any and all liability whatsoever which may now or hereafter accrue in favor of
Purchaser against Sellers' Affiliates, in connection with or arising out of this
Agreement or the transactions contemplated hereby, except pursuant to Section
25.5 and except for separate agreements entered into contemporaneously.
B. If Sellers shall be in default, after notice and
a reasonable opportunity to cure (i.e., 10 days notice for monetary default and
30 days notice for defaults for non-monetary defaults, with a due diligence
extension for a non-monetary default not reasonably capable of being cured
within said 30 days period) in their failure to fulfill their obligations under
Sections 8.1(b), 8.1(c), 13.2 , 13.4, 19.1, or under the Repair and Replacement
Agreement of even date herewith between Sellers and Purchaser, Purchaser shall,
in addition to any other rights
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or remedies at law or in equity or hereunder or thereunder, have a right of
offset for all of Purchaser's losses, costs, expenses and damages (including
without limitation reasonable attorney's fees and disbursements) suffered or
incurred by reason or arising out of such default against the amounts due and
owing Sellers under the Loan Agreement, the Notes and the Mortgages.
Notwithstanding the foregoing, Purchaser's offset rights shall not have priority
over the amounts due and owing (a) General Electric Capital Corporation ("GECC")
under GECC's mortgages encumbering the ▇▇▇▇▇ Farm Shopping Center Property,
Marathon Shopping Center Property, Marysville Towne Center Property, Kanawha
Mall Property and Village Royale Shopping Center Property and the notes and
other obligations secured thereby for the GECC regularly scheduled installments
of principal and interest (i.e., the basic GECC debt service) (b) National Bank,
N.A. ("NatWest") under NatWest's mortgage(s) secured by the Coronado Center
Property and the note(s) and other obligations secured thereby for NatWest's
regularly scheduled installments of principal and interest (i.e., the NatWest
basic debt service), (c) the Aid Association for Lutherans (the "Lutheran
Lender") under the Lutheran Lender's mortgage(s) encumbering the Washington
Plaza Shopping Center Property and the note(s) and other obligations secured
thereby for the Lutheran Lender's regularly scheduled installments of principal
and interest (i.e., the Lutheran basic debt service) and (d) the Union Labor
Life Insurance Company (the "Union Lender") and the National Bank of Commerce
("Commerce Lender") under their respective mortgage(s) encumbering the
University Plaza Shopping Center Property and the notes and other obligations
secured thereby for the Union Lender's and Commerce Lender's regularly scheduled
installments of principal and interest (i.e., the ULLIC and NBC basic debt
service); all of the foregoing basic debt service, the "Basic Debt Service").
The Basic Debt Service is more particularly described in Schedule 22 annexed
hereto.
C. The provisions of this Section 25.5 shall survive
the termination of this Agreement and the Closing.
25.6 Purchaser agrees that, wherever this Agreement provides
that Purchaser must send or give any notice, make an election or take some other
action within a specific time period in order to exercise a right or remedy it
may have hereunder, time shall be of the essence with respect to the taking of
such action, and Purchaser's failure to take such action within the applicable
time period shall be deemed to be an irrevocable waiver by Purchaser of such
right or remedy.
25.7 No failure or delay of either party in the exercise of
any right or remedy given to such party hereunder or the waiver by any party of
any condition hereunder for its benefit (unless the time specified herein for
exercise of such right or remedy has expired) shall constitute a waiver of any
other or further right or remedy nor shall any single or partial exercise of any
right or remedy preclude other or further exercise thereof or any other right or
remedy. No waiver by either party of any breach hereunder or failure or refusal
by the other party to comply with its obligations shall be deemed a waiver of
any other or subsequent breach, failure or refusal to so comply.
25.8 Neither this Agreement nor any memorandum thereof shall
be recorded and any attempted recordation hereof shall be void and shall
constitute a default.
25.9 This Agreement may be executed in one or more
counterparts, each of which so executed and delivered shall be deemed an
original, but all of which taken together shall constitute but one and the same
instrument.
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25.10 Each of the exhibits and schedules referred to herein
and attached hereto is incorporated herein by this reference.
25.11 The caption headings in this Agreement are for
convenience only and are not intended to be a part of this Agreement and shall
not be construed to modify, explain or alter any of the terms, covenants or
conditions herein contained.
25.12 This Agreement shall be interpreted and enforced in
accordance with the laws of the State of New York without reference to
principles of conflicts of laws.
25.13 If the last day of the period prescribed herein for the
giving of any notice, election, consent, approval, demand, objection or request
or the submission of any documents by any party hereunder shall fall on a
Saturday, Sunday or any day observed as a public holiday by the federal
government or the state in which the Property is situated, then such period
shall be deemed to be extended to the immediately following day which is not a
Saturday, Sunday or such public holiday. The term "business day" as used in this
Agreement shall mean any day other than Saturday, Sunday or any day observed as
a public holiday by the federal government or the state in which the Property is
situated.
25.14 Unless otherwise specified herein, (a) references to
persons or parties include their permitted successors and assigns; (b)
references to modifications or amendments shall in all events mean modifications
and amendments; (c) references to statutes are to be construed as including all
rules and regulations adopted pursuant to the statute referred to and all
statutory provisions consolidating, amending or replacing the statute referred
to; (d) references to agreements and other contractual instruments shall be
deemed to include all subsequent amendments and other modifications thereto
entered into from time to time after the date hereof to satisfy the requirements
of this Agreement or otherwise with Seller's prior written consent; (e)
references to a mortgage shall be deemed to mean or include a deed of trust,
depending on the jurisdiction in which the Property is located; (f) the words
"include" or "including", and words of similar import, shall be deemed to be
followed by the words "but not limited to" or "without limitation"; (g) the
words "hereto", "herein", "hereof" and "hereunder", and words of similar import,
refer to this Agreement in its entirety; and (h) unless otherwise specified
herein, all references to Sections are to Sections of this Agreement. Terms
defined herein may be used in the singular or the plural; when used in the
singular and preceded by "a", "an" or "any", such term shall be taken to
indicate one or more members of the relevant class; and when used in the plural,
such term shall be taken to indicate all members of the relevant class. Any
disclosure on any Schedule attached hereto shall be deemed a disclosure on any
other Schedule attached hereto.
25.15 If any provision of this Agreement shall be
unenforceable or invalid, the same shall not affect the remaining provisions of
this Agreement and to this end the provisions of this Agreement are intended to
be and shall be severable. Notwithstanding the foregoing sentence, if (a) any
provision of this Agreement is finally determined by a court of competent
jurisdiction to be unenforceable or invalid in whole or in part, (b) the
opportunity for all appeals of such determination have expired, and (c) such
unenforceability or invalidity alters the substance of this Agreement (taken as
a whole) so as to deny either party, in a material way, the realization of the
intended benefit of its bargain, such party may terminate this Agreement within
thirty (30) days after the final determination by notice to the other. If such
party so elects to terminate this Agreement, then this Agreement shall be
terminated and neither party shall have any further rights, obligations or
liabilities hereunder, except for the Surviving Obligations, and except that
Purchaser shall be entitled to a return of the Fund subject to Section 24.4 and
provided Purchaser is not otherwise in default hereunder.
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25.16 Sellers shall cooperate with and assist Purchaser in
taking over Sellers insurance policies relating to the Properties, at
Purchaser's sole cost and expense. Seller shall use diligent reasonable efforts
to cause such policies to be transferred to Purchaser prior to Closing.
25.17 SELLERS AND PURCHASER HEREBY WAIVE TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER ARISING IN TORT OR CONTRACT) BROUGHT
BY EITHER AGAINST THE OTHER ON ANY MATTER ARISING OUT OF OR IN ANY WAY CONNECTED
WITH THIS AGREEMENT.
25.18 Purchaser acknowledges that it has no interest in the
site reserves currently being maintained by General Electric Capital Corp. and
the Four Lenders in connection with the Properties and that all such reserves
shall belong exclusively to the Sellers.
25.19 Sellers and Purchaser each hereby agree that each shall,
upon the request of the other, execute and deliver such further documents and do
such other acts and things as are reasonably necessary and appropriate to
effectuate the terms and conditions of this Agreement and the out-of pocket
reasonable cost of such further acts shall be paid for by the party requesting
such further acts unless imposed on or required to be performed by the requested
party under the other terms of this Agreement , the Financing Documents, or
other agreements being entered into or delivered contemporaneously herewith. The
provisions of this Section shall survive the closing.
25.20 Within 60 days after the Closing Date Sellers shall
furnish Purchaser with a supplement to Schedule 4 setting forth all extension,
renewal, expansion, and cancellation options, and all rights of first refusal or
options to purchase or lease, held by tenants under the Leases in effect as of
the date hereof (other than the Oak Grove Cinema at the ▇▇▇▇▇ Grove, Oregon
Property). If any such tenants shall claim that the sale hereunder of the
Property in which such tenants are respectively located entitles such tenants to
purchase the premises demised to them, and shall prevail in such claim in a
court of law of competent jurisdiction, and if the price determined in such
proceeding to be payable by such tenants shall be less than the allocable
portion of the purchase price hereunder for the affected Property (such
allocable portion to be determined by capitalizing the net operating income
attributable to such tenant, using a "cap" rate of 10%), then Sellers shall pay
such deficiency to Purchaser, but Sellers' obligations for such payment shall be
limited to $250,000 in the aggregate. If the price as so determined shall be
greater than such allocable portion, then the excess shall be divided between
Seller and Purchaser as follows: 83% to Seller and 17% to Purchaser. In either
event, upon payment of such price as so determined, Sellers shall release the
portion of the affected Property from the lien of the applicable Mortgage and
other Security Documents and shall cause the holder of the First Mortgage
encumbering such Property to release such portion from the lien thereof. The
release provisions of this Paragraph 25.20 shall be deemed incorporate into the
Property release provisions of the Loan Agreement and the Mortgages.
25.21. Reference is made to the Repair and Replacement
Agreement entered into concurrently herewith between Sellers and Purchaser. The
provisions thereof relating to compliance of the work to be performed by Sellers
with applicable legal and insurance requirements, and granting Purchaser certain
"self-help" rights to perform such work at Sellers' expense, shall be
incorporated by reference, mutatis mutandis, into Section 13.2 hereof (relating
to certain work to be performed by Sellers with respect to the pending leases
referred to therein). Furthermore, the parties agree that the person named as
the Engineer in such Repair and Replacement Agreement to serve as
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the arbiter of certain work-related issues shall also serve as the arbiter of
any work-related disputes between the parties with respect to the work to be
performed by Sellers under Section 13.2 hereof, and the same fee and
cost-sharing provision of said Agreement shall also apply to the services of
such arbiter with respect to Sellers' work under such Section.
25.22. Within 30 days after the date hereof Sellers shall
deliver to Purchaser's counsel (as named in the Notice Clause hereof) reasonable
evidence as to (i) the authority of Sellers' Affiliate, Apollo Real Estate
Investment Fund, L.P. ("▇▇▇▇▇"), to execute and deliver those certain
indemnities being delivered by ▇▇▇▇▇ to Purchaser concurrently herewith, and
(ii) the due authorization and execution and delivery of such indemnities by
▇▇▇▇▇.
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IN WITNESS WHEREOF, this Agreement has been duly executed by
the parties hereto as of the day and year first above written.
SELLERS
AP CENTURY I, L.P., a Delaware limited
partnership
By: AP-GP CENTURY I, L.P., a Delaware limited
partnership
By: AP CENTURY I OPERATING
CORPORATION, a Delaware Corporation
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇
---------------------------
▇▇▇ ▇▇▇▇▇▇▇, Vice President
AP CENTURY II, L.P., a Delaware limited
partnership
By: AP-GP CENTURY II, L.P., a Delaware
limited partnership
By: AP CENTURY II OPERATING
CORPORATION, a Delaware Corporation
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇
---------------------------
▇▇▇ ▇▇▇▇▇▇▇, Vice President
AP CENTURY III, L.P., a Delaware limited
partnership
By: AP-GP CENTURY III, L.P., a Delaware
limited partnership
By: AP CENTURY III OPERATING
CORPORATION, a Delaware Corporation
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇
---------------------------
▇▇▇ ▇▇▇▇▇▇▇, Vice President
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AP CENTURY IV, L.P., a Delaware limited
partnership
By: AP-GP CENTURY IV, L.P., a Delaware
limited partnership
By: AP CENTURY IV OPERATING
CORPORATION, a Delaware Corporation
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇
---------------------------
▇▇▇ ▇▇▇▇▇▇▇, Vice President
AP CENTURY V, L.P., a Delaware limited
partnership
By: AP-GP CENTURY V, L.P., a Delaware
limited partnership
By: AP CENTURY V OPERATING
CORPORATION, a Delaware Corporation
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇
----------------------------
▇▇▇ ▇▇▇▇▇▇▇, Vice President
AP CENTURY VI, L.P., a Delaware limited
partnership
By: AP-GP CENTURY VI, L.P., a Delaware
limited partnership
By: AP CENTURY VI OPERATING
CORPORATION, a Delaware Corporation
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇
---------------------------
▇▇▇ ▇▇▇▇▇▇▇, Vice President
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AP CENTURY VIII, L.P., a Delaware limited
partnership
By: AP-GP CENTURY VIII, L.P., a Delaware
limited partnership
By: AP CENTURY VIII OPERATING
CORPORATION, a Delaware Corporation
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇
---------------------------
▇▇▇ ▇▇▇▇▇▇▇, Vice President
AP CENTURY IX, L.P., a Delaware limited
partnership
By: AP-GP CENTURY IX, L.P., a Delaware
limited partnership
By: AP CENTURY IX OPERATING
CORPORATION, a Delaware Corporation
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇
---------------------------
▇▇▇ ▇▇▇▇▇▇▇, Vice President
PURCHASER
NEW VALLEY CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Executive Vice President
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