BUENAVENTURA MALL
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SALE-PURCHASE AGREEMENT
between
MCA BUENAVENTURA ASSOCIATES, L.P.,
Seller
and
▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ LIMITED PARTNERSHIP,
Purchaser
Dated as of November 22, 1996
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TABLE OF CONTENTS
1. Sale of the Property............................................ 1
2. Purchase Price.................................................. 2
3. Apportionments.................................................. 3
4. Due Diligence Review and Closing Date........................... 9
5. Permitted Encumbrances.......................................... 9
6. Title .......................................................... 9
7. Representations and Warranties................................. 12
8. Transfer Taxes................................................. 17
9. Conditions Precedent to the Closing............................ 18
10. Documents to be Delivered by Seller at the Closing............. 21
11. Documents to be Delivered by Purchaser at the Closing.......... 24
12. Operation of the Property prior to the Closing Date............ 24
13. As Is ......................................................... 27
14. Broker ........................................................ 30
15. Casualty; Condemnation......................................... 31
16. Remedies....................................................... 33
17. Seller's Indemnity............................................. 34
(i)
18. Purchaser's Indemnity.......................................... 35
19. Escrow......................................................... 35
20. Assignment..................................................... 39
21. Access to Records.............................................. 39
22. Notices........................................................ 39
23. Property Information and Confidentiality....................... 42
24. Miscellaneous.................................................. 44
25. Fees and Expenses.............................................. 47
26. Return of the Downpayment...................................... 47
27. Existing Buenaventura Litigation............................... 48
(ii)
SALE-PURCHASE AGREEMENT (this "Agreement"), dated as of the 22 day of November,
1996, by and between MCA BUENAVENTURA ASSOCIATES, L.P., a Delaware limited
partnership, having an office c/o LaSalle Advisors Limited, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("Seller"), and ▇▇
▇▇▇▇▇▇▇▇▇▇▇▇ LIMITED PARTNERSHIP, a California limited partnership, having an
office at ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
("Purchaser").
W I T N E S S E T H
- - - - - - - - - -
WHEREAS, Seller is the owner of the Property (as defined in Section 1),
which Property constitutes a part of that certain shopping center commonly known
as Buenaventura Plaza, County of Ventura and State of California (the "Shopping
Center"); and
WHEREAS, Seller and Purchaser desire to enter into an agreement whereby,
subject to the terms and conditions contained herein, Seller shall sell the
Property to Purchaser and Purchaser shall purchase the Property from Seller.
NOW, THEREFORE, in consideration of ten dollars ($10.00) and the mutual
covenants and agreements hereinafter set forth, and intending to be legally
bound hereby, it is hereby agreed as follows:
1. SALE OF THE PROPERTY
Seller agrees to sell and convey to Purchaser, and Purchaser agrees to
purchase from Seller, 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 County of Ventura and State of California, as more particularly described
in SCHEDULE "1" annexed hereto and made a part hereof (the "Land"), together
with (i) all buildings and other improvements situated on the Land
(collectively, the "Buildings"), (ii) all easements, rights of way,
reservations, privileges, appurtenances and other estates and rights of Seller
pertaining to the Land and the Buildings, (iii) all right, title and interest of
Seller in and to all fixtures, machinery, equipment, supplies and other articles
of personal property attached or appurtenant to the Land or the Buildings or
used in connection therewith, including, without limitation, all personal
property listed on SCHEDULE "2" annexed hereto, but excluding property
(x) removable by any tenants pursuant to their Leases (as defined below),
(y) owned by public utility suppliers or (z) owned by any cleaning or other
independent contractors (collectively, the "Personal Property"), (iv) all right,
title and interest of Seller, if any, in and to all strips and gores, all alleys
adjoining the Land, and the land lying in the bed of any street, road
or avenue, opened or proposed, in front of or adjoining the Land to
the center line thereof, (v) all right, title and interest of Seller,
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 Land or the Buildings by reason of a change of grade of any
street, road or avenue; (vi) Seller's interest in all leases and
occupancy agreements with respect to the Land or Buildings ("Leases")
and in all reciprocal easement or operating agreements with anchor
tenants at the Shopping Center (the "Shopping Center Agreements");
(vii) Seller's interest in all Contracts (as defined in Section
10(c)); and (viii) all right, title and interest of Seller, if any,
in and to all intangible property owned by Seller with respect to the
operation of the Property or the Shopping Center listed on
SCHEDULE "3" annexed hereto, including, without limitation, the trade name
"Buenaventura Plaza" (collectively, the "Intangible Property") (the
Land, together with all of the foregoing items listed in clauses (i)-(viii)
above, being hereinafter sometimes collectively referred to as the "Property").
2. PURCHASE PRICE
The purchase price to be paid by Purchaser to Seller for the
Property (the "Purchase Price") is Seventeen Million and No/100
Dollars ($17,000,000.00) payable as follows:
(a) Within two (2) business days after execution and delivery of this
Agreement, Purchaser shall deliver the sum of Two Hundred Thirty-Six Thousand
Four Hundred and No/100 Dollars ($236,400.00) (the "Downpayment") to
Commonwealth Land Title Insurance Company (the "Escrow Agent" or the "Title
Company"), by a bank wire transfer of immediately available funds to an
account designated by Escrow Agent. The Downpayment shall be held and
disbursed by Escrow Agent in accordance with the terms of Section 19. If the
Closing shall occur, Seller shall be entitled to receive the Downpayment and
all interest accrued thereon, if any, and such interest shall be credited
against the portion of the Purchase Price payable pursuant to Section 2(b).
The definition of "Downpayment" shall further include all interest accrued
thereon, if any; and
(b) Purchaser shall deliver the sum of $16,763,600 plus or minus the
apportionments set forth in Section 3 to be made on the Closing Date at the
Closing by bank wire transfer of immediately available funds to Seller's
account or to the account or accounts of such other party or parties as may
be designated by Seller on or before the Closing Date (as hereinafter
defined), PROVIDED that Purchaser shall be entitled to (i) a credit against
the Purchase Price in an amount equal to $150,000, and the Purchase Price
shall be reduced by the amount of such credit, on account of Purchaser's
assumption of the Buenaventura Development Litigation (as hereinafter
defined) and the costs associated therewith, and (ii) a credit against the
Purchase Price in an
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amount equal to $80,000, and the Purchase Price shall be reduced by the
amount of such credit, on account of Purchaser's assumption of the remaining
costs of completing the environmental remediation at the former GASCO site
located on the Property.
3. APPORTIONMENTS
(a) The following shall be apportioned between Seller and Purchaser at
the Closing as of midnight of the day preceding the Closing Date:
(i) prepaid basic rents and other amounts payable by tenants (other
than "Recoveries" (as hereinafter defined)), if, as and when received;
(ii) percentage rents as provided in Section 3(c)(ii) and "Recoveries"
as provided in Section 3(c)(iii):
(iii) 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;
(iv) salaries, wages, vacation pay and any other fringe benefits
(including, without limitation, social security; unemployment compensation;
employee health, life and disability insurance; sick pay; and welfare and
pension fund contributions, payments and deposits, if any) of all persons
employed at the Property whose employment is not terminated at or prior to
the Closing in each case to the extent Seller is responsible for such costs
under the terms of the existing Management Agreement, dated as of September
19, 1994, between Seller and Macerich Management Company ("Manager");
(v) charges and payments under Contracts transferred to Purchaser;
(vi) any prepaid items to the extent not included in clauses (iii),
(vii), (ix), (xi) and (xii), including, without limitation, fees for licenses
which are transferred to Purchaser at the Closing and transferable annual
permit and inspection fees but excluding prepaid financing and leasing costs
(other than leasing costs set forth in Section 12(a)(ii));
(vii) utilities, including, without limitation, telephone, water,
sewer, 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;
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(viii) deposits with telephone and other utility companies, and any
other persons or entities who supply goods or services in connection with the
Property if same are assigned to Purchaser at the Closing, which shall be
credited in their entirety to Seller;
(ix) personal property taxes, if any, on the basis of the fiscal year
for which assessed;
(x) Seller's share, if any, of all revenues from the operation of
the Property other than rents and Recoveries (including, without limitation,
parking charges, and telephone booth and vending machine revenues), if, as
and when received;
(xi) trade association dues and trade subscriptions, if any;
(xii) taxes payable by Seller relating to operations of the Property,
including, without limitation, business and occupancy taxes (to the extent
the payment of such taxes inures to the benefit of Purchaser) and sales
taxes, if any, but excluding Seller's income taxes; and
(xiii) such other revenues and operating expenses relating to the
Property as are customarily apportioned between sellers and purchasers of
real properties of a type similar to the Property and located in the County
of Ventura and State of California, PROVIDED that, except as set forth in
Section 12(a), there shall be no apportionment on account of leasing
commissions, tenant allowances, free rent or other tenant concessions.
(b) 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 the Closing shall be promptly corrected and the proper
party reimbursed, which obligations shall survive the Closing in accordance
with Section 3(g).
(c)(i) If on the Closing Date any tenant or any party to a Shopping Center
Agreement is in arrears in the payment of rent or other charges (including
Recoveries) or has not paid the rent or other charges (including Recoveries)
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 or other charges
(including Recoveries) received by Purchaser or Seller from such tenant or party
after the Closing shall be deemed first to be payment of money owed by such
tenant or party to Purchaser in respect
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of periods subsequent to the Closing Date to the extent any such rent or other
charges (including Recoveries) are due and payable on the date such payment is
received (and, to the extent such payment relates to the rent or other charges
(including Recoveries) due for the month in which the Closing occurs, shall be
pro-rated between Seller and Purchaser) and any balance shall be deemed to be
payment of rent and/or other charges (including Recoveries) in arrears on the
Closing Date and shall be paid over to Seller in an amount up to the balance to
which Seller is entitled. Notwithstanding anything to the contrary contained
herein, all rent or other sums received from a tenant or a party to a Shopping
Center Agreement which is designated by the tenant or such party as a payment of
a certain invoice or for a certain period shall be applied as so designated.
(ii) Any percentage rentals received after the Closing Date and
attributable entirely or in part to the lease year in which the Closing Date
occurs shall be allocated between Purchaser and Seller such that Seller's
share with respect to each tenant shall be an amount equal to the total
percentage rentals received for such tenant's lease year, multiplied by a
fraction equal to that portion of such tenant's lease year preceding the
Closing Date over the entire lease year, PROVIDED that with respect to any
tenant who pays percentage rent only, such calculation shall be made based on
the 1996 calendar year (or portion thereof in which such tenant was paying
percentage rent only) in lieu of the lease year for percentage rent specified
in such tenant's Lease. There shall be deducted from the amounts due to
Seller any sums Seller may have received from tenants on account of such
percentage rents, unless previously adjusted. If Seller has received more
than its appropriate share, the same shall be promptly paid to Purchaser.
(iii) (a) As used herein,
(i) "Recoveries" shall mean all common area maintenance charges,
enclosed mall maintenance charges, real estate taxes, personal property
taxes and other reimbursable charges for the 1996 calendar year for
each such item to the extent denominated as such charges or other
expenses in Leases or Shopping Center Agreements.
(ii) "Recoverable Expenses" shall mean any operating expenses of
the Property for which funds are collected as Recoveries under the
Leases or Shopping Center Agreements for the 1996 calendar year for
each such item.
(iii) "Recovery Rate" shall mean a fraction, the numerator of
which is the total aggregate Recoveries with respect to the Property
for the 1996 calendar
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year, and the denominator of which is the total aggregate Recoverable
Expenses with respect to the Property for the 1996 calendar year.
(b) Notwithstanding anything to the contrary contained herein, all
Recoveries with respect to the Property shall be prorated on the following
basis:
(i) At the Closing, Recoveries shall be prorated based upon the
estimated Recovery Rate (which shall be equal to the Recovery Rate
actually experienced with respect to Recoverable Expenses in the 1996
calendar year through October 31, 1996). At the Closing, Seller shall
receive an additional payment or Purchaser shall receive a credit
against the Purchase Price, in each case as described below, equal to
the difference between:
(1) the Recoveries for the 1996 calendar year billed through
the Closing, and
(2) the product of (x) the Recoverable Expenses incurred (on
an accrual basis) for the 1996 calendar year prior to the
Closing ("Pre-Closing Recoverable Expenses"), and (y) the
estimated Recovery Rate.
If the difference between clause (1) and clause (2) above is negative,
then Seller shall be entitled to receive, in addition to the Purchase
Price, an amount equal to such negative difference at the Closing. If
the difference between clause (1) and clause (2) above is positive,
then Purchaser shall be entitled to receive at the Closing a credit
against the Purchase Price in an amount equal to such positive
difference.
(ii) Upon the determination of the actual Recovery Rate for the
1996 calendar year, the actual Recovery Rate will be compared to the
estimated Recovery Rate used at the Closing. If the actual Recovery
Rate is different than the estimated Recovery Rate then the difference
between clause (1) and (2) in subsection (b)(i) above of this
Section 3(c)(iii) shall be recalculated using the actual Recovery Rate
instead of the estimated Recovery Rate. Based on such recalculation,
the payment or credit that Seller or Purchaser should have been
entitled to receive at the Closing under subsection (b)(i) shall be
determined, and
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any adjustments and payments necessary as a result of such
recalculation shall be made.
(iv) The provisions of this Section 3(c) shall survive the
Closing.
(d) After the Closing, Seller shall continue to have the right,
in its own name and at its own expense, to demand payment of and to collect
rent and other arrearages owed to Seller by any tenant under a Lease or from
any party under a Shopping Center Agreement, which right shall include,
without limitation, the right to continue or commence legal actions or
proceedings against such party, and the delivery of the Lease Assignment (as
defined in Section 10(b)) or the Shopping Center Agreement Assignment (as
defined in Section 10(p)) shall not constitute a waiver by Seller of such
right, PROVIDED that after the Closing Seller shall not be entitled to
commence an eviction action against any such tenant. Purchaser agrees to
cooperate with Seller and to use its reasonable efforts, but without
incurring expense to Purchaser other than DE MINIMIS charges, to collect such
rents and other arrearages and to take all reasonable steps, whether before
or after the Closing Date, as may be necessary to carry out the intention of
the foregoing, including, without limitation, making available to Seller,
upon demand, for review and copying at Seller's expense, of any relevant
books and records (including any rent or Recoveries statements, receipted
bills and copies of tenant checks used in payment of such rent or
Recoveries), the execution of any and all consents or other documents, and
the undertaking of any act necessary for the collection of such rents and
other arrearages by Seller, provided that after the Closing Purchaser shall
not be obligated to commence an eviction action against any such tenant. The
provisions of this Section 3(d) shall survive the Closing.
(e) Purchaser shall be entitled to receive a credit at Closing from
Seller equal to the amount of any and all security deposits received by Seller
for all tenants on the Property and not applied against obligations owing by
tenants in accordance with their respective Leases, together with interest
required either by law or by contract.
(f) If there is a water meter on the Property, Seller shall
furnish a reading to a date not more than thirty (30) days prior to the
Closing 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. Said apportionment shall be recomputed in accordance with
Section 3(g) and such obligation shall survive the Closing in accordance with
Section 3(g)).
(g) 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
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necessary to compute such apportionment, or if any errors or omissions in
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. Seller
shall have the right to review and audit the books and records of Purchaser for
purposes of confirming compliance with the provisions of this Section 3. 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 (i) has obtained the previously unavailable information or has
discovered the error or omission, and (ii) 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. Notwithstanding any of the foregoing provisions of this
Section 3(g) to the contrary, Purchaser and Seller agree that the one hundred
eighty (180) day limitation set forth in this Section 3(g) shall not apply to
the parties' obligations under Section 3(b) or 3(c) and that such obligations
shall survive the Closing forever.
(h) (i) If, on the date of this Agreement, the Property 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 (A) Seller shall be obligated to pay
all installments of any such assessment which are due and payable prior to
the Closing Date, and (B) 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 Property and
the payment thereof shall be assumed by Purchaser without abatement of the
Purchase Price.
(ii) If, subsequent to the date hereof, the Property or any
part thereof shall become affected by an assessment or assessments, said
assessments shall not be deemed to be liens upon the Property and the payment
thereof shall be assumed by Purchaser without abatement of the Purchase
Price. 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 Seller, Purchaser shall reimburse Seller for same at the Closing.
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4. DUE DILIGENCE REVIEW AND CLOSING DATE
(a) Except with respect to title matters (which shall be
governed by Section 6 hereof), Purchaser acknowledges that it has completed
its due diligence review of the Property prior to the date hereof.
(b) The delivery of the Deed and the consummation of the
transactions contemplated by this Agreement (the "Closing") shall take place
at the offices of Sidley & Austin, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ at 10:00 A.M. on or about December 5, 1996 or such other
date as Purchaser and Seller may agree upon (the "Closing Date"). The Closing
Date may be adjourned to a later date in accordance with the terms of this
Agreement or by agreement of the parties but shall in no event occur later
than December 13, 1996, time being of the essence.
5. PERMITTED ENCUMBRANCES
Seller shall convey and Purchaser shall accept title to the
Property subject to those matters set forth on SCHEDULE "4" annexed hereto
and made a part hereof (collectively the "Permitted Encumbrances").
6. TITLE
(a) (i) Purchaser has ordered a commitment for an owner's fee
title insurance policy or policies with respect to the Property (the "Title
Commitment") from the Title Company, together with true, legible (to the
extent available) and complete copies of all instruments giving rise to
exceptions to title to the Property. If the Title Commitment indicates the
existence of any liens, encumbrances or other defects or exceptions in or to
title to the Property other than the Permitted Encumbrances (collectively,
the "Unacceptable Encumbrances") subject to which Purchaser is unwilling to
accept title and Purchaser gives Seller notice of the same within ten (10)
days after the date of this Agreement, Seller shall undertake to eliminate
the same subject to Section 6(b). Purchaser hereby waives any right Purchaser
may have to advance as objections to title or as grounds for Purchaser's
refusal to close this transaction any Unacceptable Encumbrance of which
Purchaser does not notify Seller within such ten (10) day period unless
(i) such Unacceptable Encumbrance was first raised by the Title Company
subsequent to the date of the Title Commitment or Purchaser shall otherwise
first discover same or be advised of same subsequent to the date of the Title
Commitment, and (ii) Purchaser shall notify Seller of the same within five
(5) days after Purchaser first becomes aware of such Unacceptable Encumbrance
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(failure to so notify Seller shall be deemed to be a waiver by Purchaser of
its right to raise such Unacceptable Encumbrance as an objection to title or as
a ground for Purchaser's refusal to close this transaction). Seller or
Purchaser, in its sole discretion, may adjourn the Closing one or more times in
order to eliminate Unacceptable Encumbrances (subject to Section 6(b) and the
last sentence of Section 4(b)).
(ii) If Seller is unable (subject to Section 6(b)) to eliminate
all Unacceptable Encumbrances not waived by Purchaser, or to arrange for title
insurance acceptable to Purchaser in its sole discretion insuring Purchaser and
its successors against enforcement of such Unacceptable Encumbrances against, or
collection of the same out of, the Property, and to convey title in accordance
with the terms of this Agreement on or before the Closing Date (whether or not
the Closing is adjourned as provided in Section 6(a)(i)), Purchaser shall elect
on or prior to the Closing Date, as its sole remedy for such inability of
Seller, either (A) to terminate this Agreement by notice given to Seller
pursuant to Section 16(a), in which event the provisions of Section 16(a) shall
apply, or (B) to accept title subject to such Unacceptable Encumbrances and
receive no credit against, or reduction of, the Purchase Price. Notwithstanding
anything to the contrary contained herein (but subject to the last sentence of
Section 4(b)), if (x) Seller eliminates all Unacceptable Encumbrances less than
two (2) days prior to the scheduled Closing Date or (y) Seller is unable to
eliminate all Unacceptable Encumbrances and Purchaser elects to proceed under
clause (B) above, then Purchaser will have the right to extend the scheduled
Closing Date for up to two (2) business days.
(b) Notwithstanding anything to the contrary set forth in this Section 6
or elsewhere in this Agreement, Seller 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 by Purchaser or to
arrange for title insurance insuring against enforcement of such Unacceptable
Encumbrances against, or collection of the same out of, the Property; except
that Seller shall satisfy (i) all mortgages and deeds of trust granted by Seller
or granted by Buenaventura Plaza in favor of Aetna Life Insurance Company,
(ii) delinquent real estate taxes and assessments (subject to apportionment as
provided above); and (iii) judgments against Seller or other liens arising from
Seller's acts secured by or affecting the Property which can be satisfied by
payment of liquidated amounts not to exceed $500,000 in the aggregate for all
such matters set forth in this clause (iii) (the foregoing matters set forth in
clauses (i), (ii) and (iii) being collectively referred to as "Liens"). Without
limiting the generality of the preceding provisions of this Section 6(b), for
the purposes of this Agreement (including, without limitation, Sections 6(a) and
16(a)), Seller's failure or refusal to bring any action or proceeding, to make
any payments or to otherwise incur any expense (except for Seller's obligation
to satisfy the matters
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set forth in clauses (i), (ii) and (iii) as aforesaid) in order to eliminate
Unacceptable Encumbrances not waived by Purchaser or to arrange for such title
insurance shall be deemed (whether willful or otherwise) an inability of Seller
to eliminate such Unacceptable Encumbrances or to arrange for such title
insurance and shall not be a default by Seller hereunder.
(c) If on the Closing Date there may be any Liens or other encumbrances
which Seller must pay or discharge in order to convey to Purchaser such title as
is herein provided to be conveyed (including, without limitation, the lien of
the mortgage held by Aetna Life Insurance Company), Seller may use any portion
of the Purchase Price to satisfy the same, provided:
(i) Seller 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 together with the cost of recording or filing said
instruments; or
(ii) Seller, having made arrangements (which arrangements shall be
satisfactory to Purchaser in its sole discretion) 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.
The existence of any such Liens or other encumbrances shall not be deemed
objections to title if Seller shall comply with the foregoing requirements.
(d) Similarly, at Seller's election, unpaid Liens for taxes, water and
sewer charges and assessments, which are the obligation of Seller to satisfy and
discharge, shall not be objections to title, 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(b) and shall be allowed to Purchaser, subject to the
provisions for apportionment of taxes, water and sewer charges and assessments
contained herein.
(e) If on the Closing Date there shall be conditional bills of sale,
chattel mortgage or security interests filed against the Property, the same
shall not constitute objections to title provided Seller executes and delivers
an affidavit to the effect either (i) that the personal property covered by said
conditional bills of sale, chattel mortgages, or security interests is no longer
in or on the Property, or (ii) if such personal property is still in or on the
Property, that it has been fully paid for (in which case Seller shall provide
evidence of such payment), or (iii) that such personal property is the property
of a tenant of the Property.
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(f) Any franchise or corporate tax open, levied or imposed against
Seller 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 or excepts
same but insures Purchaser against collection thereof out of the Property.
(g) 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 Seller, Seller will deliver to Purchaser and the Title Company an
affidavit stating that such judgments, bankruptcies or other returns are not
against Seller, whereupon, provided the Title Company omits such returns as
exceptions to title or provides affirmative coverage with respect thereto,
such returns shall not be deemed an objection to title.
7. REPRESENTATIONS AND WARRANTIES
(a) (i) Seller represents and warrants to Purchaser as follows:
A. 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 of California to conduct business therein.
B. Seller has the full legal right, power and authority to execute
and deliver this Agreement and all documents now or hereafter to be executed
by Seller pursuant to this Agreement (collectively, the "Seller's
Documents"), to consummate the transaction contemplated hereby, and to
perform its obligations hereunder and under the Seller's Documents.
Furthermore, this Agreement is valid and enforceable against Seller in
accordance with its terms, and each instrument to be executed by Seller
pursuant to this Agreement or in connection herewith, will, when executed and
delivered, be valid and enforceable against Seller in accordance with its
terms.
C. This Agreement and the Seller's Documents do not and will not
contravene any provision of the organizational documents of Seller, any
judgment, order, decree, writ or injunction issued against Seller, or any
provision of any laws or governmental ordinances, rules, regulations, orders
or requirements (collectively, "Laws") applicable to Seller. Subject to the
prepayment by Seller at the Closing of the existing first mortgage loan on
the Property held by Aetna Life Insurance Company (the "Existing First
Mortgage Loan"), the consummation of the transactions contemplated hereby
will not result in a breach or constitute a default or event of default by
Seller under any agreement to which Seller or any of its assets are subject
or bound and will not result in a violation of any Laws applicable to Seller.
Subject to the prepayment by Seller
12
at the Closing of the Existing First Mortgage Loan, no consent of any party,
judicial or administrative body, or governmental authority or agency, to the
execution, delivery or performance by Seller is required.
D. To Seller's knowledge, as of the date hereof, there are no
pending actions, suits, proceedings or investigations to which Seller is a
party before any court or other governmental authority with respect to the
Property (collectively, the "Claims") except (i) pending actions (including,
without limitation, litigation with existing tenants of the Property and
"slip and fall" or other claims covered by insurance (except to the extent of
the deductible) and which are based on occurrences during the period prior to
May 20, 1995) being handled by the Manager of the Property on behalf of
Seller and the Claims relating to the potential redevelopment of the Property
as set forth on SCHEDULE "5" annexed hereto and made a part hereof (the
"Buenaventura Development Litigation") (such pending actions and the
Buenaventura Development Litigation being collectively referred to herein as
the "Assumed Claims") and (ii) as set forth on SCHEDULE "6" annexed hereto
and made a part hereof (the "Retained Claims").
E. Since September 19, 1994, Seller has not modified any of the
existing Anchor Leases (as hereinafter defined) or Shopping Center
Agreements, or otherwise made any contractual commitment to any tenant under
an Anchor Lease or to any party to a Shopping Center Agreement, in each case
which would be binding on Purchaser following the Closing, except as set
forth on SCHEDULE "7" annexed hereto and made a part hereof. As used herein,
"Anchor Leases" shall mean any lease with a store covering more than 75,000
square feet of rentable area.
F. Since September 19, 1994, except as set forth in SCHEDULE "8"
annexed hereto and made a part hereof or disclosed to Purchaser or its
affiliates in writing, Seller has not, to Seller's knowledge, entered into
any new Lease or amended any existing Lease, in each case which would be
binding on Purchaser following the Closing, except for those new Leases or
amendments negotiated by Manager.
G. Since September 19, 1994, except as set forth in SCHEDULE "9"
annexed hereto and made a part hereof or disclosed to Purchaser or its
affiliates in writing, Seller has not, to Seller's knowledge, made any
contractual commitment with any governmental entity or other third party
relating to the operation of the Property which would be binding on Purchaser
following the Closing, except those negotiated by Manager.
H. Seller is not a "foreign person" within the meaning of Section
1445(f)(3) of the Internal Revenue Code of 1986, as amended.
13
I. To Seller's knowledge, since September 19, 1994, Seller has not
received (i) any written notice from a tenant under an Anchor Lease or a
party to a Shopping Center Agreement alleging a material default by the
Seller thereunder which remains uncured except as may be set forth in an
estoppel certificate obtained pursuant to Section 9(a)(iv), (ii) any written
notice from Seller's insurance carrier alleging the existence of a dangerous
condition upon the Property for which Seller's insurance may be canceled if
not corrected or (iii) except for any alleged violation relating to the
proposed redevelopment of the Buenaventura Property, any written notice from
a municipality having jurisdiction over the Property alleging the existence
of a material violation of any applicable law with respect to the Property or
commencing a condemnation proceeding with respect to a material portion of
the Property, in each case which Seller has not notified Purchaser or its
affiliates (including Manager) of by delivering a copy of such notice to
Purchaser or its affiliates or of which Purchaser or its affiliates otherwise
does not have knowledge.
J. To Seller's knowledge, Seller has delivered to Purchaser true
and correct copies of all documents set forth on Schedules 7, 8 and 9.
As used in this Agreement, the words "Seller's 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
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇ without such persons having any
obligation to make an independent inquiry or investigation.
(ii) If at or prior to the Closing, (A) Purchaser shall become
aware (whether through its own efforts, by notice from Seller or otherwise)
that any of the representations or warranties made herein by Seller are
untrue, inaccurate or incorrect and shall give Seller notice thereof at or
prior to the Closing, or (B) Seller shall notify Purchaser that a
representation or warranty made herein by Seller is untrue, inaccurate or
incorrect, then Seller may, in its sole discretion, elect by notice to
Purchaser to adjourn the Closing one or more times in order to cure or
correct such untrue, inaccurate or incorrect representation or warranty
(subject to the last sentence of Section 4(b)). If any such representation
or warranty is both (1) material and (2) materially untrue, inaccurate or
incorrect, and is not cured or corrected by Seller on or before the Closing
Date (whether or not the Closing is adjourned as provided above), then
Purchaser, as its sole remedy for any and all such materially untrue,
inaccurate or incorrect material representations or warranties, shall elect
either (x) to waive such misrepresentations or breaches of warranties and
consummate the transactions contemplated hereby without any reduction of or
credit against the Purchase Price, or (y) to terminate this Agreement by
notice given to Seller on the Closing Date, in which event, this Agreement
shall be terminated and neither party shall have any further rights,
14
obligations or liabilities hereunder, except for the Surviving Obligations,
and except that Purchaser (subject to the provisions of Sections 19 and 26
and provided Purchaser is not otherwise in default hereunder) shall be
entitled to a return of the Downpayment. Purchaser acknowledges and agrees
that (x) at or prior to the Closing, Purchaser's rights and remedies in the
event any of Seller's representations or warranties made in this Agreement
are untrue, inaccurate or incorrect shall be only as provided in this Section
7(a)(ii), and (y) if the Closing does not occur, 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 Seller) as a result of any of Seller's representations
or warranties made in this Agreement being untrue, inaccurate or incorrect.
(iii) In the event the Closing occurs:
(A) Notwithstanding anything contained in Section 7(a)(ii) or elsewhere
in this Agreement to the contrary, 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 Seller for damages
that Purchaser may incur, or to rescind this Agreement and the transactions
contemplated hereby, as the result of any of Seller's representations or
warranties being untrue, inaccurate or incorrect if (1) Purchaser knew, or is
deemed to have known that such representation or warranty was untrue,
inaccurate or incorrect at the time of the Closing and Purchaser nevertheless
closes title hereunder, or (2) Purchaser's aggregate damages as a result of
one or more such representations or warranties being untrue, inaccurate or
incorrect are less than $100,000. Purchaser shall be "deemed to have known"
that a representation or warranty was untrue, inaccurate or incorrect at the
time of the Closing to the extent that the Property Information (as
hereinafter defined) furnished or made available to or otherwise obtained by
Purchaser contains information which reveals such representation or warranty
untrue, inaccurate or incorrect (or to the extent any of its Property
investigations prior to the Closing Date reveals such untruth, inaccuracy or
error).
(B) Notwithstanding anything contained herein to the contrary, if the
Closing shall have occurred and Purchaser shall not 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 Seller and its
affiliates arising pursuant to or in connection with the representations,
warranties, covenants and other obligations (whether express or implied)
under this Agreement and/or the Seller's Documents (including, without
limitation, the Deed and the A & A Agreements (as defined in Section 10(d))
and the Other Sale Agreements (as defined in Section 9(a)(viii)) and/or
15
the Seller's Documents (as defined in each of the Other Sale Agreements),
shall not exceed the amount set forth on SCHEDULE "10".
The provisions of this Section 7(a)(iii) shall survive the Closing.
(iv) The representations and warranties of Seller set forth in Section
7(a)(i) 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 to the extent they
relate only to an earlier date. The representations and warranties of Seller
set forth in Section 7(a)(i)(D) shall be deemed to be repeated on and as of
the Closing Date as such representations and warranties may have been updated
by Seller to Purchaser in writing on and after the date hereof and prior to
the Closing Date, provided, however, that in the event that any such update
discloses a Claim, other than a Claim relating to the proposed redevelopment
of the Buenaventura Property that is based on substantially the same issues
as are set forth in the Buenaventura Development Litigation, that would be
binding on Purchaser or the Property after the Closing and which would have a
material adverse effect on the value of the Property and the properties
covered by the Other Sale Agreements, taken as a whole, then, Purchaser shall
have the right, exercisable within 10 days after its receipt of such update
or one day prior to the Closing Date, whichever is earlier, to either (i)
terminate this Agreement by notice given to Seller pursuant to Section 16(a),
in which case the provisions of Section 16(a) shall apply or (ii) consummate
the transactions contemplated by this Agreement and receive no credit
against, or reduction of, the Purchase Price. The representations and
warranties (whether express or implied) of Seller set forth in Section
7(a)(i) and elsewhere in this Agreement, and/or the Seller's Documents
(including, without limitation, the Deed and the A & A Agreements) shall
remain operative and shall survive the Closing and the execution and delivery
of the Deed for a period of twelve (12) months following the Closing Date,
and no action or claim based thereon shall be commenced after such period.
(b) (i) Purchaser represents and warrants to Seller as follows:
(A) Purchaser is a duly formed and validly existing limited
partnership organized under the laws of the State of California, and will be
qualified under the laws of the State of California to conduct business
therein on the Closing Date.
(B) 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
16
transactions contemplated hereby, and to perform its obligations hereunder
and under Purchaser's Documents. Furthermore, this Agreement is valid and
enforceable against Purchaser in accordance with its terms, and each
instrument to be executed by Purchaser pursuant to this Agreement or in
connection herewith, will, when executed and delivered, be valid and
enforceable against Purchaser in accordance with its terms.
(C) This Agreement and Purchaser's Documents do not and will not
contravene any provision of the organization documents of Purchaser, any
judgment, order, decree, writ or injunction issued against Purchaser, or any
provision of any Laws applicable to Purchaser. Except for that certain
Amended and Restated Credit Agreement (the "▇▇▇▇▇ Fargo Credit Agreement"),
dated as of January 18, 1996, between The Macerich Partnership, L.P., ▇▇▇▇▇
Fargo Bank, N.A., as Agent, and certain other parties, as to which Purchaser
has advised Seller that The Macerich Partnership L.P. has obtained oral
approval for the transactions contemplated hereby and for which The Macerich
Partnership L.P. will obtain a written consent prior to the Closing (the
"▇▇▇▇▇ Fargo Consent"), the consummation of the transactions contemplated
hereby will not result at the time of such consummation 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. Except for the ▇▇▇▇▇
Fargo Consent, no consent of any party, judicial or administrative body or
governmental authority or agency, to the execution, delivery or performance
by Purchaser is required.
(D) 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 the transactions
contemplated hereby.
(ii) The representations and warranties of Purchaser set forth in
Section 7(b)(i) 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, and shall survive
the Closing.
8. TRANSFER TAXES
At the Closing, Seller shall pay all transfer and recording taxes (the
"Transfer Tax Payments"), if any, imposed pursuant to the laws of the State
of California or any other governmental authority in respect of the
transactions contemplated by this Agreement by delivery to the Title Company
of good, unendorsed, certified or official bank checks, payable to the order
17
of the relevant governmental authority together with any return (the
"Transfer Tax Return") required thereby which shall be duly executed by
Seller and Purchaser.
9. CONDITIONS PRECEDENT TO THE CLOSING
(a) Purchaser's obligation under this Agreement to purchase the Property
is subject to the fulfillment of each of the following conditions, subject,
however, to the provisions of Section 9(c):
(i) The representations and warranties of Seller contained herein
shall be materially true, accurate and correct as of the Closing Date, all
subject to the provisions of Sections 7(a)(ii) and 7(a)(iv);
(ii) Seller shall be ready, willing and able to deliver title to
the Property in accordance with the terms and conditions of this Agreement;
(iii) Seller shall have delivered all the documents and other items
required pursuant to Section 10, 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 Seller at or
prior to the Closing;
(iv) Purchaser shall have obtained an estoppel certificate from
each tenant under an Anchor Lease in the form required under such Anchor
Lease and each third party to a Shopping Center Agreement in the form
required in such Shopping Center Agreement, which estoppel certificate shall
not disclose any commitments by Seller to such tenant or party or defaults
under such Anchor Lease or Shopping Center Agreement by Seller that in each
case would either have a material adverse effect on the Property or impose a
material adverse financial obligation on Purchaser, and of which, in each
case, Purchaser was not aware as of the date of this Agreement;
(v) All consents and approvals of governmental authorities and
parties to agreements to which Seller is a party or by which Seller's assets
are bound that are required with respect to the consummation by Seller of the
transactions contemplated by this Agreement shall have been obtained and
copies thereof shall have been delivered to Purchaser at or prior to the
Closing;
(vi) On or prior to the Closing Date, (A) Seller shall not have
applied for or consented to the appointment of a receiver, trustee or
liquidator for itself or any of its assets unless
18
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, (B) Seller shall
not have admitted in writing an inability to pay its debts as they mature,
(C) Seller shall not have made a general assignment for the benefit of
creditors, (D) Seller shall not have been adjudicated a bankrupt or
insolvent, or had a petition for reorganization granted with respect to
Seller, (E) Seller 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;
(vii) On or prior to the Closing Date, the Development Agreement
substantially in the form of EXHIBIT "J" annexed hereto and made a part
hereof between Seller and the City of San Buenaventura shall have been
executed and delivered and the leases referred to therein shall have been
executed and delivered in escrow in accordance with escrow instructions
substantially in the form of EXHIBIT "K" annexed hereto and made a part
hereof.
(viii) Simultaneously with the Closing, the closings shall occur
under both (i) that certain Sale and Purchase Agreement of even date herewith
between MCA Fresno Associates, L.P. and MR Fresno Limited Partnership with
respect to certain property in Fresno, California known as Fresno Fashion
Fair Mall and (ii) that certain Sale and Purchase Agreement of even date
herewith between MCA Huntington Associates, L.P. and ▇▇ ▇▇▇▇▇▇▇▇▇▇ Limited
Partnership with respect to certain property in Huntington Beach, California
known as Huntington Center (such Sale and Purchase Agreements collectively,
the "Other Sale Agreements").
(b) Seller's obligation under this Agreement to sell the Property to
Purchaser is subject to the fulfillment of each of the following conditions,
subject, however to the provisions of Section 9(c):
(i) The representations and warranties of Purchaser contained
herein shall be materially true, accurate and correct as of the Closing Date;
(ii) Purchaser shall have delivered the funds required hereunder
and all the documents to be executed by Purchaser set forth in 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 Purchaser at or prior to the Closing;
19
(iii) All consents and approvals of governmental authorities and
parties to agreements to which Purchaser is a party or by which Purchaser's
assets are bound that are required with respect to the consummation of the
transactions contemplated by this Agreement shall have been obtained,
including the ▇▇▇▇▇ Fargo Consent, and Purchaser shall have so certified to
Seller at or prior to the Closing;
(iv) On or prior to the Closing Date, (A) neither Purchaser nor The
Macerich Partnership L.P. shall 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,
(B) neither Purchaser nor The Macerich Partnership L.P. shall have admitted
in writing an inability to pay its debts as they mature, (C) neither
Purchaser nor The Macerich Partnership L.P. shall have made a general
assignment for the benefit of creditors, (D) neither Purchaser nor The
Macerich Partnership L.P. shall have been adjudicated a bankrupt or
insolvent, or had a petition for reorganization granted with respect to
Purchaser or The Macerich Partnership L.P., (E) neither Purchaser nor The
Macerich Partnership L.P. shall 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;
(v) The additional matters set forth in SCHEDULE "11" annexed
hereto and made a part hereof, if any, shall have occurred or been delivered
to Seller, as applicable, at or prior to the Closing; and
(vi) Simultaneously with the Closing, the closings shall occur
under both of the Other Sale Agreements.
(c) In the event that any condition contained in Section 9(a) or (b) is
not satisfied, the party entitled to the satisfaction of such condition as a
condition to its obligation to close title hereunder shall have as its sole
remedy hereunder the right to elect to (i) waive such unsatisfied condition
whereupon title shall close as provided in this Agreement or (ii) terminate
this Agreement. In the event such party elects to terminate this Agreement,
this Agreement shall be terminated and neither party shall have any further
rights, obligations or liabilities hereunder, except as otherwise expressly
provided herein (those rights, obligations and liabilities hereunder
20
that expressly by the terms of this Agreement survive the Closing are herein
collectively referred to as the "Surviving Obligations") and except that
Purchaser (subject to the provisions of Sections 19 and 26 and provided
Purchaser is not otherwise in default hereunder) shall be entitled to a
return of the Downpayment. Nothing contained in this Section 9(c) shall be
construed so as to bestow any right of termination upon a party for the
failure of a condition to be satisfied unless such party is expressly
entitled to the satisfaction of such condition as provided in Section 9(a) or
(b).
10. DOCUMENTS TO BE DELIVERED BY SELLER AT THE CLOSING
At the Closing, Seller shall execute, acknowledge and/or deliver or
cause to be executed, acknowledged and/or delivered, as applicable, the
following to Purchaser or the Title Company:
(a) A grant deed (the "Deed") conveying title to the Property in the
form of EXHIBIT "B" annexed hereto and made a part hereof.
(b) The Assignment and Assumption of Leases and Security Deposits in the
form of EXHIBIT "C" annexed hereto and made a part hereof (the "Lease
Assignment") pursuant to which Seller will assign to Purchaser all of
Seller's right, title and interest, if any, in and to the Leases, all
guarantees thereof and the security deposits thereunder in Seller's
possession, if any, and Purchaser shall assume all obligations under such
Leases as set forth in such Lease Assignment.
(c) The Assignment and Assumption of Contracts and Licenses in the form
of EXHIBIT "D" annexed hereto and made a part hereof (the "Contract and
License Assignment") pursuant to which Seller will assign to Purchaser all of
Seller's right, title and interest, if any, in and to (i) all of the
assignable licenses, permits, certificates, approvals, authorizations and
variances issued for or with respect to the Property by any governmental
authority (collectively, the "Licenses") and (ii) all assignable purchase
orders, equipment leases, advertising agreements, franchise agreements,
license agreements, leasing and brokerage agreements and other service
contracts relating to the operation of the Property which have been disclosed
in writing to Purchaser prior to the date hereof (collectively, the
"Contracts"), and Purchaser shall assume all obligations under such Contracts
and Licenses as set forth in the Contract and License Assignment, PROVIDED
that Purchaser may notify Seller within 5 days after the date hereof if
Purchaser desires Seller to terminate any of the Contracts listed on SCHEDULE
"9" prior to the Closing.
(d) The Assignment and Assumption of Intangible Property in the form of
EXHIBIT "E" annexed hereto and made part hereof (the "Intangible Property
Assignment") (the Lease
21
Assignment, the Contract and License Assignment, the Intangible Property
Assignment and the Shopping Center Agreement Assignment referred to in clause
(p) below are herein referred to collectively as the "A & A Agreements")
pursuant to which Seller will assign to Purchaser all of Seller's right,
title and interest, if any, in and to the Intangible Property, and Purchaser
shall assume all obligations under such Intangible Property as set forth in
the Intangible Property Assignment.
(e) To the extent in Seller's possession, executed counterparts (or
copies of same) of all Leases, Shopping Center Agreements and New Leases and
any amendments, guarantees and other documents relating thereto, together
with a schedule of all tenant security deposits thereunder and all accrued
interest on such security deposits payable to tenants which are in the
possession of Seller as either required by law or by the terms of the Lease,
if any. In the event any such cash security deposits and the interest thereon
payable to tenants are held by a bank, savings bank, trust company or savings
and loan association, at Seller's option, Seller shall deliver to Purchaser,
in lieu of such checks or credit, an assignment to Purchaser of such deposits
and interest and written instructions to the holder thereof to transfer such
deposits and interest to Purchaser. With respect to any lease security
deposits which are other than cash, Seller shall execute and deliver to
Purchaser at the Closing any appropriate instruments of assignment or
transfer without warranty or representation.
(f) A ▇▇▇▇ of sale in the form of EXHIBIT "F" annexed hereto and made a
part hereof (the "▇▇▇▇ of Sale") conveying, transferring and selling to
Purchaser without warranty or representation all right, title and interest of
Seller in and to all Personal Property. It is agreed that the value of such
property does not exceed Fifty Thousand and No/100 ($50,000.00) Dollars, that
Seller shall prepare any required sales tax return (the "Sales Tax Return"),
that such return shall be executed by Purchaser and delivered to Seller at
the Closing, that Seller shall file such return and that Purchaser shall pay
the sales tax due thereon in accordance with Section 11(c).
(g) Notices to the tenants of the Property in the form of EXHIBIT "G"
annexed hereto and made a part hereof advising the tenants of the sale of the
Property to Purchaser and directing that rents and other payments thereafter
be sent to Purchaser or as Purchaser may direct.
(h) If required by law or Seller's partnership agreement, copies of any
partnership resolutions and/or consents of the partners of Seller 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 a general partner of Seller.
22
(i) To the extent in Seller's possession and not already located at the
Property or held by Manager or its agents or employees, keys to all entrance
doors to, and equipment and utility rooms located in, the Property.
(j) To the extent in Seller's possession and not already located at the
Property or held by Manager or its agents or employees, all Licenses.
(k) To the extent in Seller's possession and not already located at the
Property or held by Manager or its agents or employees, executed counterparts
of all Contracts (or copies of same) and all warranties in connection
therewith which are in effect on the Closing Date and which are assigned by
Seller (such items may be delivered to Purchaser at the Property).
(1) To the extent in Seller's possession and not already located at the
Property or held by Manager or its agents or employees, plans and
specifications of the Buildings.
(m) The Transfer Tax Payment and the Transfer Tax Return.
(n) A "FIRPTA" affidavit sworn to by Seller in the form of EXHIBIT "H"
annexed hereto and made a part hereof and any corresponding affidavits
required under California law with respect to the sale of real property
located in the State of California. Purchaser acknowledges and agrees that
upon Seller's 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
or any corresponding statutes or regulations under California law.
(o) cancellations of all management and leasing agreements relating to
the Shopping Center (including, without limitation, the existing management
contract with the Manager (the "Management Agreement").
(p) The Assignment and Assumption of Shopping Center Agreements in the
form of EXHIBIT "I" annexed hereto and made a part hereof (the "Shopping
Center Agreement Assignment") pursuant to which Seller will assign to
Purchaser all of Seller's right, title and interest, if any, in and to the
Shopping Center Agreements and Purchaser shall assume all obligations under
such Shopping Center Agreements to the extent set forth in the Shopping
Center Agreement Assignment.
23
(q) All other documents Seller is required to deliver pursuant to the
provisions of this Agreement or as may be reasonably required by the Title
Company.
11. DOCUMENTS TO BE DELIVERED BY PURCHASER AT THE CLOSING
At the Closing, Purchaser shall execute, acknowledge and/or deliver (or
cause to be executed, acknowledged and delivered), as applicable, the
following to Seller:
(a) The Purchase Price payable at the Closing pursuant to Section 2(b),
subject to apportionments, credits and adjustments as provided in this
Agreement.
(b) The ▇▇▇▇ of Sale.
(c) The Sales Tax Return, if required, together with a check payable to
the order of the appropriate collection officer in the amount of the sales
tax due thereon.
(d) The cancellation of the Management Agreement, executed by Manager.
(e) If Purchaser is a partnership, copies of Purchaser's partnership
agreement and partnership certificate (if applicable) and, if required by law
or its partnership agreement, copies of partnership resolutions and/or
consents of the partners authorizing the execution, delivery and performance
of this Agreement and the consummation of the transactions contemplated by
this Agreement, all certified as true and correct by a general partner of
Purchaser.
(f) The A & A Agreements.
(g) The Transfer Tax Return.
(h) All other documents Purchaser is required to deliver pursuant to the
provisions of this Agreement or as may be reasonably required by the Title
Company.
12. OPERATION OF THE PROPERTY PRIOR TO THE CLOSING DATE
Between the date hereof and the Closing Date, Seller shall have the
right to continue to operate and maintain the Property as set forth herein.
In connection therewith:
24
(a) (i) From and after the date hereof, Seller shall not modify, extend,
renew or cancel (subject to Section 12(b)) any Lease (including any Anchor
Lease) or any Shopping Center Agreement or enter into any proposed Lease of
all or any portion of the Property, other than those currently being
negotiated and set forth on SCHEDULE "12" annexed hereto and made a part
hereof, without Purchaser's prior consent in each instance, which 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 12(a)(iv).
(ii) If, after the date hereof, Seller enters into any Leases, or if
there is any 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, including but not limited to any new Lease or any extension,
renewal, expansion or modification of an existing Lease currently being
negotiated and set forth on SCHEDULE "12" (each, a "New Lease"), Seller 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, (G) tenant improvement allowances provided to the tenant under
such leasing transactions, and (H) expenses incurred pursuant to a New Lease
for the purpose of satisfying or terminating the obligations of the tenant
thereunder to a landlord under another lease (whether or not such other lease
covers space in the Property).
(iii) The New Lease Expenses for each New Lease allocable to and payable
by Seller 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
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12(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 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 Seller for
all New Lease Expenses theretofore paid by Seller, if any, in excess of the
portion of the New Lease Expenses allocated to Seller pursuant to the
provisions of the preceding sentence. The provisions of this Section
12(a)(iii) shall survive the Closing.
(iv) With respect to any proposed action by Seller to be submitted to
Purchaser for its consent pursuant to Section 12(a)(i), Purchaser shall
consent or deny its consent, with the reasons for any such denial, within ten
(10) days after receipt by Purchaser of Seller's notice requesting
Purchaser's consent to the proposed action relating to such existing or
proposed Lease or Shopping Center Agreement.
If Purchaser fails to reply to Seller's request for consent pursuant to the
provisions of Subsections 12(a)(i) in a notice given within the
above-described applicable time period or if Purchaser expressly denies its
consent but fails to provide Seller with the reasons for such denial,
Purchaser's consent shall be deemed to have been granted.
(b) Notwithstanding anything to the contrary contained in this
Agreement, Seller reserves the right, but is 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, PROVIDED that
Seller will obtain Purchaser's written consent (not to be unreasonably
withheld or delayed) prior to instituting any summary proceeding with respect
to any tenant. Seller makes no representations and assumes no responsibility
with respect to the continued occupancy of the Property or any part thereof
by any tenant. The 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, subject, however, to apportionment
pursuant to Paragraph 3 above.
26
(c) Seller shall not modify, extend, renew or cancel (except as a result
of a default by the other party thereunder) any Contracts that affect the
operation of the Property, or enter into any new Contract that materially
affects the operation of the Property without Purchaser's prior consent in
each instance, which consent shall not be unreasonably withheld or delayed,
and if withheld, Purchaser shall promptly give Seller a notice stating the
reasons therefor. With respect to any proposed action by Seller to be
submitted to Purchaser for its consent pursuant to this subsection (c),
Purchaser shall grant or deny its consent, with the reason for any such
denial within ten (10) days after receipt by Purchaser of Seller's notice
requesting Purchaser's consent to the proposed action relating to such
existing or proposed Contract. If Purchaser fails to reply to Seller's
request for consent pursuant to the provisions of this subsection (c) in a
notice given within the above described time period or if Purchaser expressly
denies its consent but fails to provide Seller with the reasons for such
denial, Purchaser's consent shall be deemed to be granted.
(d) Seller, through its accountants and attorneys engaged for such
purpose, has commenced but not completed proceedings for the partial refund
of real estate taxes and assessments based on a claimed reduction in
assessable valuation of the Property. From and after the Closing Date,
Purchaser will supervise and coordinate such proceedings and the efforts of
such accountants and attorneys, and will pay all charges incurred in
connection therewith. All refunds received after the Closing Date, whether
for tax years prior to or after the 1996-1997 tax year, shall be paid to
Purchaser, and Seller shall have no responsibility in connection therewith or
interest therein, provided that Purchaser shall be responsible for the
payments of any such refunds to any tenants entitled thereto. The provisions
of this Section 12(d) shall survive the Closing indefinitely.
13. AS IS
(a) AS A MATERIAL PART OF THE CONSIDERATION FOR THIS AGREEMENT, SELLER
AND PURCHASER AGREE THAT PURCHASER IS TAKING THE PROPERTY "AS-IS" WITH ANY
AND ALL LATENT AND PATENT DEFECTS AND THAT THERE IS NO WARRANTY BY SELLER
THAT THE PROPERTY IS FIT FOR A PARTICULAR PURPOSE. EXCEPT AS EXPRESSLY SET
FORTH HEREIN, PURCHASER ACKNOWLEDGES THAT IT IS NOT RELYING UPON ANY
REPRESENTATION, STATEMENT OR OTHER ASSERTION WITH RESPECT TO THE PROPERTY
CONDITION, BUT IS RELYING UPON ITS EXAMINATION OF THE PROPERTY. EXCEPT AS
OTHERWISE PROVIDED FOR IN THIS AGREEMENT, PURCHASER TAKES THE PROPERTY UNDER THE
EXPRESS UNDERSTANDING THERE ARE NO EXPRESS OR IMPLIED WARRANTIES. THE
PROVISIONS OF THIS
27
SECTION 13(a) SHALL NOT NEGATE ANY EXPRESS REPRESENTATIONS OF SELLER SET
FORTH IN THIS AGREEMENT. PURCHASER ACKNOWLEDGES THAT (A) AN AFFILIATE OF
PURCHASER OWNED THE PROPERTY PRIOR TO SEPTEMBER 19, 1994, WITH AN AFFILIATE
OF SELLER, (B) SINCE SEPTEMBER 19, 1994, PURCHASER'S AFFILIATE, MANAGER, HAS
BEEN THE MANAGER OF THE PROPERTY AND (C) BASED ON ITS PRIOR OWNERSHIP AND THE
MANAGER'S MANAGEMENT OF THE PROPERTY, PURCHASER IS FAMILIAR WITH THE
MANAGEMENT, OWNERSHIP, OPERATION, MAINTENANCE, FINANCIAL AND PHYSICAL
CONDITION AND OTHER MATTERS RELATING TO THE PROPERTY. PURCHASER FURTHER
ACKNOWLEDGES THAT PURCHASER IS A SOPHISTICATED BUYER, WITH EXPERIENCE IN REAL
ESTATE INVESTMENTS.
(b) This Agreement, as written, together with that certain License and
Indemnity Agreement dated as of September 19, 1996 (the "License and
Indemnity Agreement") between Seller and The Macerich Partnership, L.P.,
contains all the terms of the agreement entered into between the parties as
of the date hereof, and Purchaser acknowledges that neither Seller nor any of
Seller's Affiliates (as defined in Section 24(e)), nor any of their agents or
representatives, nor Broker has made any representations or held out any
inducements to Purchaser, and Seller hereby specifically disclaims any
representation, oral or written, past, present or future, other than those
specifically set forth in this Agreement. Without limiting the generality of
the foregoing, Purchaser has not relied on any representations or warranties,
and neither Seller nor any of Seller's 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
(i) the status of title to the Property; (ii) the Leases, the Anchor Leases
or the Shopping Center Agreements; (iii) the Contracts; (iv) the Licenses;
(v) the current or future real estate tax liability, assessment or valuation
of the Property; (vi) the potential qualification of the Property 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; (vii) the compliance of the Property 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 Property' non-compliance, if any, with
zoning Laws; (viii) the nature and extent of any right-of-way, lease,
possession, lien, encumbrance, license, reservation, condition or otherwise;
(ix) the availability of any financing for the purchase, alteration,
rehabilitation or operation of the Property from any source, including,
without limitation, any government authority or any lender; (x) the current
or future use of the Property, including, without limitation, the Property'
use for retail purposes; (xi) the present and future condition and
28
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; (xii) the viability or financial condition of any tenant;
(xiii) the status of the leasing market in which the Property is located; or
(xiv) the actual or projected income or operating expenses of the Property.
(c) Purchaser acknowledges that Seller has afforded Purchaser the
opportunity for full and complete investigations, examinations and
inspections of the Property and all Property Information. Purchaser
acknowledges and agrees that (i) the Property Information delivered or made
available to Purchaser and Purchaser's Representatives by Seller or Seller's
Affiliates, or any of their agents or representatives may have been prepared
by third parties and may not be the work product of Seller and/or any of
Seller's Affiliates; (ii) neither Seller nor any of Seller's Affiliates has
made or is obligated to have made any independent investigation or
verification of the Property Information; (iii) 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; (iv) Purchaser is relying solely on its own investigations,
examinations and inspections of the Property and those of Purchaser's
Representatives and is not relying in any way on the Property Information
furnished by Seller or any of Seller's Affiliates, or any of their agents or
representatives except for Seller's express representations and warranties
set forth herein; (v) except as to Seller's express representations and
warranties set forth herein, Seller expressly disclaims any representations
or warranties with respect to the accuracy or completeness of the Property
Information and Purchaser releases Seller and Seller's Affiliates, and their
agents and representatives, from any and all liability with respect thereto;
and (vi) any further distribution of the Property Information is subject to
Section 23. Purchaser, on behalf of itself and any successor owner of the
Property which is an Affiliate of Purchaser, hereby fully and irrevocably
releases Seller and Seller's Affiliates, and their agents and
representatives, from any and all claims that it may now have or hereafter
acquire against Seller or Seller's 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 obligations or liability existing as of the date hereof under any of the
Leases, the Contracts, the Licenses or the Shopping Center Agreements, except
for claims against Seller in connection with or arising out of (x) Retained
Claims, or (y) subject to Section 7(a)(iii), a breach of any representation,
warranty or covenant of Seller contained in this Agreement or the indemnity
of Seller contained in Section 17 of this Agreement. Purchaser further
acknowledges and agrees that this release shall be given full force and
effect according to each of its expressed terms and provisions, including,
but not limited to, those relating to unknown and suspected claims, damages
and causes of action.
29
(d) Purchaser acknowledges that the Property contains asbestos and other
potentially environmentally hazardous, toxic or dangerous substances.
Purchaser, on behalf of itself and any successor owner of the Property which
is an Affiliate of Purchaser, hereby fully and irrevocably releases Seller
and Seller's affiliates, and their agents and representatives, from any and
all claims that it may now have or hereafter acquire against Seller or
Seller's Affiliates, or their agents or representatives, but not any
contractors or consultants with whom Seller may have contracted for work in
connection with the Property, for any cost, loss, liability, damage, expense,
action or cause of action, whether foreseen or unforeseen, arising from or
related to any construction defects, errors or omissions on or in the
Property, the presence of environmentally hazardous, toxic or dangerous
substances, or any other conditions (whether patent, latent or otherwise)
affecting the Property, except for claims against Seller based upon any
obligations and liabilities of Seller expressly provided in this Agreement.
Purchaser further acknowledges and agrees that this release shall be given
full force and effect according to each of its expressed terms and
provisions, including, but not limited to, those relating to unknown and
suspected claims, damages and causes of action. As a material covenant and
condition of this Agreement, Purchaser agrees that in the event of any such
construction defects, errors or omissions, the presence of environmentally
hazardous, toxic or dangerous substances, or any other conditions affecting
the Property, Purchaser shall look solely to Seller's predecessors in
interest or to such contractors and consultants as may have contracted for
work in connection with the Property for any redress or relief, except for
claims against Seller based upon any obligations and liabilities of Seller
expressly provided in this Agreement. Purchaser further understands that some
of Seller's 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.
(e) Seller shall not be liable or bound in any manner by any oral or
written "setups" or information pertaining to the Property or the rents
furnished by Seller, Seller's Affiliates, their agents or representatives,
any real estate broker or other person.
(f) THE PROVISIONS OF THIS SECTION 13 SHALL SURVIVE INDEFINITELY ANY
TERMINATION OF THIS AGREEMENT AND THE CLOSING.
14. BROKER
Purchaser and Seller each represent and warrant to the other that it has
not dealt with any broker other than LaSalle Real Estate Partners ("LaSalle") in
connection with the Property and the transactions described herein. Seller shall
be solely responsible for payment of LaSalle's commission. Each party hereto
agrees to indemnify, defend and hold the other harmless from and
30
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 other 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. Notwithstanding any provisions of this Agreement to
the contrary, in no event shall Seller be liable for, and the foregoing
indemnity of Seller shall in no event apply to, claims by any other broker,
finder or other person for such fees, commissions or other compensation if such
claims are based upon dealings or agreements with prior owners of the Property.
The obligations and representations and warranties contained in this Section 14
shall survive the termination of this Agreement and the Closing.
15. CASUALTY: CONDEMNATION
(a) DAMAGE OR DESTRUCTION: If, prior to the Closing Date, a "material"
part (as hereinafter defined) of the Property is damaged or destroyed by fire
or other casualty, Seller shall notify Purchaser of such fact and, except as
hereinafter provided, Purchaser shall have the option to terminate this
Agreement upon notice to Seller given not later than ten (10) days after
receipt of Seller's notice. If this Agreement is so terminated, the
provisions of Section 15(d) shall apply. Notwithstanding the foregoing, if a
"material" part of the Property is damaged or destroyed and Purchaser elects
to terminate this Agreement as provided above, Purchaser's election shall be
ineffective if within ten (10) days after Seller's receipt of Purchaser's
election notice, Seller shall elect by notice to Purchaser to repair such
damage or destruction and shall thereafter complete such repair within 120
days after the then scheduled Closing Date at the time of Purchaser's
election. If Seller makes such election to repair, Seller shall have the
right to adjourn the Closing Date one or more times for up to one hundred
twenty (120) days in the aggregate in order to complete such repairs and
shall have the right to retain all insurance proceeds which Seller may be
entitled to receive as a result of such damage or destruction. If (i)
Purchaser does not elect to terminate this Agreement, (ii) Purchaser elects
to terminate this Agreement but such election is ineffective because Seller
elects to repair such damage and completes such repair within such 120-day
period provided above, or (iii) 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
the Property, Purchaser shall close title as provided in this Agreement and,
at the Closing, Seller shall, unless Seller has repaired such damage or
destruction prior to the Closing, (x) pay over to Purchaser the proceeds of
any insurance collected by Seller less the amount of all costs incurred by
Seller in connection with the repair of such damage or destruction plus the
lesser of (A) the amount of the deductible under the applicable insurance
31
policy or (B) the estimated cost of repair of such damage or destruction as
reasonably estimated by Seller and approved by Purchaser, and (y) assign and
transfer to Purchaser all right, title and interest of Seller in and to any
uncollected insurance proceeds which Seller may be entitled to receive from
such damage or destruction. A "material" part of the Property shall be deemed
to have been damaged or destroyed if the cost of repair or replacement shall,
together with any costs to repair or replace any of the property covered by
the Other Sale Agreements due to fire or other casualty and the estimated
cost of any lost rents not covered by an assignment of any rights of Seller
to rental loss insurance which may under the terms of Seller's insurance
policy be assigned to Purchaser, exceed $3,000,000 in the aggregate.
(b) CONDEMNATION: If, prior to the Closing Date, all or any
"significant" portion (as hereinafter defined) of the Property is taken by
eminent domain or condemnation (or is the subject of a pending taking which
has not been consummated), Seller shall notify Purchaser of such fact and
Purchaser shall have the option to terminate this Agreement upon notice to
Seller given not later than ten (10) days after receipt of the Seller's
notice. If this Agreement is so terminated, the provisions of Section 15(d)
shall apply. If Purchaser does not elect to terminate this Agreement, or if
an "insignificant" portion ("insignificant" is herein deemed to be any taking
which is not "significant", as such term is herein defined) of the Property
is taken by eminent domain or condemnation, Purchaser shall close title as
provided in this Agreement and, at the Closing Seller 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 the Property means (i) any portion of the Buildings,
(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 number required under any Anchor Lease or Shopping Center
Agreement, (iii) a legally required driveway on the Land which cannot be
replaced with a new driveway so as to satisfy the necessary legal
requirements, or (iv) any other driveway on such Land if such driveway is the
predominant means of ingress thereto or egress therefrom.
(c) Notwithstanding anything contained in Section 15(a) and Section
15(b) to the contrary, if this Agreement is not terminated as provided in
Section 15(a) or Section 15(b) and the insurance, eminent domain or
condemnation proceeds payable with respect to the Property as a result of any
casualty or taking exceeds the Purchase Price, Seller's obligation to pay
over to Purchaser those proceeds paid to Seller prior to the Closing shall be
limited to the amount of the Purchase Price and Seller shall be entitled to
retain the remainder of 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 Seller shall be entitled to that portion of the proceeds in excess
of the Purchase Price, which agreement shall survive the Closing.
32
(d) If Purchaser elects to terminate this Agreement pursuant to Section
15(a) or 15(b), 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 (subject to the provisions
of Sections 19 and 26 and provided Purchaser is not otherwise in default
hereunder) shall be entitled to a return of the Downpayment.
16. REMEDIES
(a) If the Closing fails to occur by reason of Seller's inability
(subject to Section 6(b)) to perform its obligations under this Agreement (as
opposed to Seller's failure or refusal to perform such obligations), then
Purchaser, as its sole remedy for such inability of Seller, may either (i)
terminate this Agreement by notice to Seller or (ii) waive such defect
causing such inability and proceed to close without any abatement or
reduction of the Purchase Price. 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 (subject to the provisions
of Sections 19 and 26 and provided Purchaser is not otherwise in default
hereunder) shall be entitled to a return of the Downpayment. Except as set
forth in this Section 16(a), Purchaser hereby expressly waives, relinquishes
and releases any other right or remedy available to it at law, in equity or
otherwise (including, without limitation, any right to record or file a
notice of lis pendens or notice of pendency of action or similar notice
against any portion of the Property and the right to ▇▇▇ for or seek any
monetary award or judgment and/or consequential, incidental, punitive,
exemplary or other damages from or against Seller) if the Closing fails to
occur by reason of Seller's inability to perform its obligations hereunder.
(b) If the Closing fails to occur by reason of Purchaser's failure or
refusal to perform its obligations hereunder, or if the closing under any of
the Other Sale Agreements fails to occur by reason of the failure or refusal
of any affiliate of Purchaser to perform its obligations thereunder, then
Seller may terminate this Agreement by notice to Purchaser. If Seller 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 Seller may
retain the Downpayment as liquidated damages for all loss, damage and
expenses suffered by Seller, it being agreed that Seller's damages are
impossible to ascertain. Nothing contained herein shall limit or restrict
Seller's ability to pursue any rights or remedies it may have against
Purchaser with respect to the Surviving Obligations. Except as set forth in
this Section 16(b) and Section 23(e) and except for any rights and remedies
that Seller may have under Section 18, Seller hereby expressly waives,
relinquishes and releases any other right or remedy
33
available to it at law, in equity or otherwise by reason of Purchaser's
default hereunder or Purchaser's failure or refusal to perform its
obligations hereunder.
PURCHASER AND SELLER ACKNOWLEDGE THAT, IN THE EVENT OF A DEFAULT AS
DESCRIBED ABOVE, IT WOULD BE IMPRACTICAL OR IMPOSSIBLE TO ACCURATELY ASCERTAIN
SELLER'S DAMAGES. ACCORDINGLY, PURCHASER AND SELLER HEREBY AGREE THAT IN THE
EVENT THE SALE HEREUNDER FAILS TO CLOSE BY REASON OF ANY DEFAULT DESCRIBED
ABOVE, SELLER SHALL BE ENTITLED TO RETAIN AS ITS SOLE REMEDY THE DOWNPAYMENT
(INCLUDING ALL INTEREST EARNED THEREON) AS LIQUIDATED DAMAGES IN LIEU OF ALL
OTHER RIGHTS AND REMEDIES TO WHICH SELLER MAY BE ENTITLED. PURCHASER AND SELLER
AGREE THAT SAID DOWNPAYMENT REPRESENTS REASONABLE LIQUIDATED DAMAGES UNDER THE
CIRCUMSTANCES.
PURCHASER'S INITIALS RAB SELLER'S INITIALS DAJ
----- -----
(c) If the Closing fails to occur by reason of Seller's failure or
refusal to perform its obligations hereunder, then Purchaser, as its sole
remedy hereunder, may (i) terminate this Agreement by notice to Seller or
(ii) seek specific performance from Seller. As a condition precedent to
Purchaser exercising any right it may have to bring an action for specific
performance as the result of Seller's 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 an action for specific performance as well as a waiver by it of any
right it may have to file or record a notice of lis pendens or notice of
pendency of action or similar notice against any portion of the Property.
Except as set forth in this Section 16(c) and Section 17, Purchaser hereby
expressly waives, relinquishes and releases any other right or remedy
available to it at law, in equity or otherwise if the Closing fails to occur
by reason of Seller's failure or refusal to perform its obligations
hereunder, including without limitation the right to ▇▇▇ for or seek any
monetary award or judgment and/or consequential, incidental, punitive,
exemplary or other damages, from or against Seller.
17. SELLER'S INDEMNITY
Seller hereby agrees to indemnify Purchaser and Purchaser's affiliates
(other than Manager) against, and to hold Purchaser and Purchaser's
affiliates (other than Manager) harmless
34
from all claims, demands, causes of action, losses, damages, liabilities,
costs and expenses (including, without limitation, attorneys' fees and
disbursements) asserted against or incurred by Purchaser or Purchaser's
affiliates (other than Manager) in connection with or arising out of (a) the
matters set forth on SCHEDULE "13" annexed hereto and made a part hereof
relating to the ownership and operation of the Property prior to the Closing
Date, or (b) subject to Section 7(a)(iii), a breach of any representation,
warranty or covenant of Seller contained in this Agreement. Seller's
obligations under this Section 17 shall survive the Closing indefinitely.
18. PURCHASER'S INDEMNITY
Purchaser hereby agrees to indemnify Seller and Seller's Affiliates
against, and to hold Seller and Seller's Affiliates harmless from all claims,
demands, causes of action, losses, damages, liabilities, costs and expenses
(including, without limitation, attorneys' fees and disbursements) asserted
against or incurred by Seller or any of Seller's Affiliates in connection with
or arising out of (a) all matters relating to the ownership or operation of the
Property from and after the Closing Date, (b) a breach of any representation,
warranty or covenant of Purchaser contained in this Agreement, (c) the Assumed
Claims, (d) any liability to tenants under Leases or parties to a Shopping
Center Agreement with respect to (i) the repayment of any real estate tax
refunds received by the Purchaser or other successor owner of the Property
subsequent to the Closing Date and relating to any tax period prior to the
Closing Date, or (ii) the repayment of any overcharges for common area
maintenance, Recoverable Expenses or similar charges, or (e) except for the
matters listed on SCHEDULE "13" hereto, all matters assumed by Purchaser
pursuant to the terms of this Agreement or any of the documents delivered
pursuant hereto. Purchaser's obligations under this Section 18 shall survive the
Closing indefinitely.
19. ESCROW
Escrow Agent shall hold the Downpayment in escrow and shall dispose of the
Downpayment only in accordance with the following provisions:
(a) Escrow Agent shall deliver the Downpayment to Seller or Purchaser,
as the case may be, as follows:
(i) to Seller, upon completion of the Closing; or
(ii) to Seller, after receipt of Seller's demand in which Seller
certifies either that (A) Purchaser has defaulted under this Agreement, or
(B) this Agreement has been otherwise
35
terminated or canceled, and Seller is thereby entitled to receive the
Downpayment; but Escrow Agent shall not honor Seller's demand until more than
ten (10) days after Escrow Agent has given a copy of Seller's demand to
Purchaser in accordance with Section 19(b)(i), nor thereafter if Escrow Agent
receives a Notice of Objection (as defined in Section 19(b)(i)) from
Purchaser within such ten (10) day period; or
(iii) to Purchaser, after receipt of Purchaser's demand in which
Purchaser certifies either that (A) Seller has defaulted under this
Agreement, or (B) this Agreement has been otherwise terminated or canceled,
and Purchaser is thereby entitled to receive the Downpayment; 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 Seller in accordance
with Section 19(b)(i), nor thereafter if Escrow Agent receives a Notice of
Objection from Seller within such ten (10) day period.
Upon delivery of the Downpayment, Escrow Agent shall be relieved of all
liability hereunder and with respect to the Downpayment unless delivered in
contradiction to the provisions hereof. Escrow Agent shall deliver the
Downpayment, 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.
(b) (i) Upon receipt of a written demand from Seller or Purchaser under
Section 19(a)(ii) or (iii), 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 Downpayment 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 (A) to continue to hold the Downpayment until Escrow Agent
receives a written agreement of Purchaser and Seller directing the
disbursement of the Downpayment, in which event Escrow Agent shall disburse
the Downpayment in accordance with such agreement; and/or (B) deposit the
Downpayment into any court of competent jurisdiction and bring any action of
interpleader or any other proceeding; and/or (C) in the event of any
litigation between Seller and Purchaser, to deposit the Downpayment with the
clerk of the court in which such litigation is pending. Notwithstanding any
other provision contained within this Agreement, if Purchaser has terminated
this Agreement in accordance with the provisions of Sections 7(a)(ii), 9(c),
15(a), 15(b), 16(a) and/or 24(m), Seller shall be entitled to deliver a
Notice of Objection to the Escrow Agent pursuant to its right to do so in
accordance
36
with the other provisions of this Section 19. Seller hereby agrees that it shall
include within any such Notice of Objection the amount which it claims to be
entitled to pursuant to the appropriate provisions of this Agreement, with any
such claim for damages being limited to actual damages expected to be suffered
or incurred by Seller as a result of Purchaser's breach of its indemnification
obligations as set forth in Sections 14 and 17 above (together with reasonable
attorney's fees and cost of suit), and with Escrow Agent being instructed to
return the balance of the Downpayment to Purchaser.
(ii) 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 19(a)(ii) or (iii), or Notice of Objection under
Section 19(b)(i)), notwithstanding anything to the contrary herein, Escrow
Agent may hold and apply the Downpayment pursuant to Section 19(b)(i)(A),(B)
or (C). In the event the Downpayment is deposited in a court by Escrow Agent
pursuant to Section 19(b)(i)(B) or (C), 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 Downpayment, Purchaser
and Seller shall pay the attorneys' 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.
(c) 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. Escrow Agent may not
commingle the Downpayment with any other funds held by Escrow Agent. Escrow
Agent may convert the Downpayment from the Approved Investment into cash or a
non-interest-bearing demand account at an Approved Institution as follows:
(i) at any time within seven (7) days prior to the Closing Date; or
(ii) 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 Seller and Purchaser shall give Escrow Agent timely notice of
any such acceleration or extension and that Escrow Agent may hold the
Downpayment in cash or a non-interest-bearing deposit account if Seller and
Purchaser do not give Escrow Agent timely notice of any such adjournment).
(d) As used herein, the term "Approved Investment" means (i) any
interest-bearing demand account or money market fund with ▇▇▇▇▇ Fargo Bank,
N.A. or any other institution otherwise approved by both Seller and Purchaser
(collectively, an "Approved Institution"), or (ii) any other investment
approved by both Seller and Purchaser. The rate of interest or yield need
37
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.
(e) Escrow Agent shall have no duties or responsibilities except those
set forth herein, which the parties hereto agree are ministerial in nature.
Seller and Purchaser acknowledge that 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. Seller 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, without limitation, attorneys'
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 only charge against the Downpayment any amounts owed to it under the
foregoing indemnity or may withhold the delivery of the Downpayment as
security for any unliquidated claim, or both if Purchaser is liable to Escrow
Agent for any costs.
(f) 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 22.
(g) Simultaneously with their execution and delivery of this Agreement,
Purchaser and Seller 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
Downpayment or other income from the Approved Investment. The party
ultimately entitled to any accrued interest in the Downpayment shall be the
party responsible for the payment of any tax due thereon.
(h) 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.
(i) The provisions of this Section 19 shall survive the termination of
this Agreement and the Closing.
38
20. ASSIGNMENT
This Agreement may not be assigned by Purchaser and any assignment or
attempted assignment by Purchaser shall constitute a default by Purchaser
hereunder and shall be null and void.
21. ACCESS TO RECORDS
For a period of five (5) years subsequent to the Closing Date, either
party to this Agreement, Affiliates of either party and their employees,
agents and representatives shall be entitled to access during business hours
to all documents, books and records given to such party by the other party at
the Closing (including all books and records given to Purchaser or its
affiliates by Manager) for tax and audit purposes, regulatory compliance, and
cooperation with governmental investigations upon reasonable prior notice to
the other party, and shall have the right, at its sole cost and expense, to
make copies of such documents, books and records. The provisions of this
Section 21 shall survive the Closing.
22. NOTICES
(a) All notices, elections, consents, approvals, demands, objections,
requests or other communications which Seller, 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 (i) first class, U.S. certified or
registered mail, return receipt requested, with postage prepaid, (ii) express
mail or courier (for next business day delivery), or (iii) telefax (in which
event a copy shall also be required to be sent in accordance with subsection
(ii) above), addressed as follows:
If to Seller:
MCA Buenaventura Associates, L.P.
c/o LaSalle Advisors Limited
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Telefax No.: ▇▇▇-▇▇▇-▇▇▇▇
39
with a copy to:
MRA Holding Partnership
c/o Citibank, N.A.
Citicorp Realty Investment
Advisors
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇
and ▇▇▇▇▇ ▇▇▇▇▇▇
Telefax No.: ▇▇▇-▇▇▇-▇▇▇▇ (▇▇▇▇ ▇▇▇▇▇▇▇▇)
Telefax No.: ▇▇▇-▇▇▇-▇▇▇▇ (▇▇▇▇▇ ▇▇▇▇▇▇)
with a copy to:
c/o Dai-ichi Life (U.S.A.), Inc.
▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telefax No.: ▇▇▇-▇▇▇-▇▇▇▇
with a copy to:
Debevoise & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telefax No.: ▇▇▇-▇▇▇-▇▇▇▇
40
with a copy to:
O'Melveny & ▇▇▇▇▇
Embarcadero Center West
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telefax No.: ▇▇▇-▇▇▇-▇▇▇▇
To Purchaser:
▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ Limited Partnership
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Art ▇▇▇▇▇▇▇
Telefax No.: ▇▇▇-▇▇▇-▇▇▇▇
with a copy to:
c/o The Macerich Company
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇, Esq.
Telefax No.: ▇▇▇-▇▇▇-▇▇▇▇
with a copy to:
Sidley & Austin
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
Telefax No.: ▇▇▇-▇▇▇-▇▇▇▇
41
If to Escrow Agent:
Commonwealth Land Title Insurance Company
▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇ ▇▇▇▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
(b) Seller, 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 22. A
notice or other communication sent in compliance with the provisions of this
Section 22 shall be deemed given and received on (i) the third (3rd) 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 express mail or courier (as evidenced
by delivery receipt), or (iii) upon confirmation of receipt if sent by
telefax in accordance with Section 22(a)(iii) above.
23. PROPERTY INFORMATION AND CONFIDENTIALITY
(a) Purchaser agrees that, prior to the Closing, all Property Information
shall be kept strictly confidential and shall not, without the prior consent
of Seller, 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 Property. 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 Property, and who have acknowledged to Purchaser in writing
their agreement to maintain the confidentiality of the Property Information
or who are by reason of their professional relationship with Purchaser so
obligated. The provisions of this Section 23(a) shall in no event apply to
Property Information which is a matter of public record and shall not prevent
Purchaser from complying with Laws, including, without limitation,
governmental regulatory, disclosure, tax and reporting requirements.
Purchaser and Seller acknowledge that the duties of Manager with respect to
Property Information are separately governed by the Management Agreement.
(b) Purchaser and Seller, 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,
42
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 23(a), 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.
(c) Each party shall indemnify and hold the other harmless from and
against any and all claims, demands, causes of action, losses, damages,
liabilities, costs and expenses (including, without limitation, attorneys'
fees and disbursements) suffered or incurred by such other party or its
Affiliates and arising out of or in connection with a breach by the
indemnifying party of the provisions of this Section 23.
(d) As used in this Agreement, the term "Property Information" shall mean
(i) all information and documents in any way relating to the Property, the
operation thereof or the sale thereof (including, without limitation, Leases,
Contracts, Shopping Center Agreements 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, without limitation, attorneys, accountants, contractors,
consultants, engineers and financial advisors (collectively, "Purchaser's
Representatives"), by Seller or any of Seller's Affiliates, or their agents
or representatives, including, without limitation, their contractors,
engineers, attorneys, accountants, consultants, brokers or advisors, and (ii)
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 (i), or otherwise reflecting their review
or investigation of the Property.
(e) In addition to any other remedies available to Seller, Seller shall
have the right to seek equitable relief, including, without limitation,
injunctive relief or specific performance, against Purchaser or Purchaser's
Representatives in order to enforce the provisions of this Section 23.
(f) The provisions of this Section 23 shall survive the termination of
this Agreement and the Closing.
43
(g) To the extent there is any inconsistency between the provisions of
this Section 23 and the provisions of the License and Indemnity Agreement,
the provisions of this Agreement shall govern and control.
24. MISCELLANEOUS
(a) 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.
(b) 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. This Agreement is not
intended to give or confer any benefits, rights, privileges, claims, actions
or remedies to any person or entity as a third party beneficiary, by decree
or otherwise.
(c) All prior statements, understandings, representations and agreements
between the parties, oral or written, are superseded by and merged in this
Agreement, which together with the License and Indemnity Agreement 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 Seller or the party drafting this Agreement.
(d) Except as otherwise expressly provided herein, Purchaser's acceptance
of the Deed shall be deemed a discharge of all of the obligations of Seller
hereunder and all of Seller's representations, warranties, covenants and
agreements herein shall merge in the documents and agreements executed at the
Closing and shall not survive the Closing.
(e) 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 Seller, including, without limitation, Citicorp, Citibank,
N.A., Citicorp Real Estate, Inc., The Dai-Ichi Mutual Life Insurance Company,
Dai-Ichi Life (U.S.A.), Inc., DSA-MRA, Inc. or LaSalle Partners or any
officer, director, employee, trustee, shareholder, partner or principal of
any such parent, subsidiary or other affiliate (collectively, the "Seller's
Affiliates"), arising out of or in connection with this Agreement or the
44
transactions contemplated hereby. Purchaser agrees to look solely to Seller 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 Seller's Affiliates with respect to any matters arising out of or
in connection with this Agreement or the transactions contemplated hereby.
Without limiting the generality of the foregoing provisions of this Section
24(e), 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 Seller's Affiliates, and hereby unconditionally and irrevocably
releases and discharges Seller's Affiliates from any and all liability
whatsoever which may now or hereafter accrue in favor of Purchaser against
Seller's Affiliates, in connection with or arising out of this Agreement or the
transactions contemplated hereby. The provisions of this Section 24(e) shall
survive the termination of this Agreement and the Closing.
(f) Seller and Purchaser agree that, wherever this Agreement provides
that a party 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 such party's failure to take such action
within the applicable time period shall be deemed to be an irrevocable waiver
by such party of such right or remedy. If performance is on a legal holiday
generally recognized by national banks in Los Angeles or New York, then the
obligations may be performed the next business day.
(g) 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.
(h) Neither this Agreement nor any memorandum thereof shall be recorded
and any attempted recordation hereof shall be void and shall constitute a
default.
(i) Delivery of this Agreement shall not be deemed an offer and neither
Seller nor Purchaser shall have any rights or obligations hereunder unless
and until both parties have signed and delivered an original of this
Agreement. This Agreement may be executed in one or more
45
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.
(j) Each of the Exhibits and Schedules referred to herein and attached
hereto is incorporated herein by this reference.
(k) 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.
(l) This Agreement shall be interpreted and enforced in accordance with the
laws of the state in which the Property is located without reference to
principles of conflicts of laws.
(m) 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 (i) any provision of
this Agreement is finally determined by a court of competent jurisdiction to
be unenforceable or invalid in whole or in part, (ii) the opportunity for all
appeals of such determination have expired, and (iii) 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 (subject to the provisions of Sections 19 and 26 and provided
Purchaser is not otherwise in default hereunder) be entitled to a return of
the Downpayment.
(n) SELLER AND PURCHASER HEREBY KNOWINGLY, VOLUNTARILY, INTENTIONALLY,
UNCONDITIONALLY AND IRREVOCABLY WAIVE ANY RIGHT EACH MAY HAVE TO 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 OR ANY OTHER DOCUMENT EXECUTED AND
DELIVERED BY EITHER PARTY IN CONNECTION HEREWITH (INCLUDING ANY ACTION TO
RESCIND OR CANCEL THIS AGREEMENT ALLEGING THAT THIS AGREEMENT OR SUCH OTHER
DOCUMENT WAS FRAUDULENTLY INDUCED OR IS OTHERWISE VOID OR VOIDABLE). EACH OF
46
THE PARTIES TO THIS AGREEMENT ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL
INDUCEMENT FOR SUCH PARTY TO ENTER INTO THIS AGREEMENT, THAT THE PARTIES TO THIS
AGREEMENT HAVE RELIED ON THIS WAIVER IN ENTERING INTO THIS AGREEMENT, AND THAT
EACH WILL CONTINUE TO RELY ON THIS WAIVER IN THEIR RELATED FUTURE DEALINGS. EACH
OF THE PARTIES TO THIS AGREEMENT FURTHER WARRANTS AND REPRESENTS THAT IT HAS
REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL, AND THAT EACH KNOWINGLY AND
VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL
COUNSEL. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS,
SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT. IN THE EVENT OF LITIGATION, THIS
AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT. THE TERMS
OF THIS SECTION 24(n) SHALL SURVIVE THE TERMINATION OF THIS AGREEMENT AND/OR THE
CLOSING.
25. FEES AND EXPENSES
Seller shall pay the fees of its attorneys and the expense of the Title
Commitment and the American Land Title Association owner's title policy
delivered at the Closing (not including the cost of any endorsements thereto
other than any curative endorsements obtained by Seller to cure any Unacceptable
Encumbrance). Purchaser shall pay the fees of its attorneys, the costs of any
survey of the Property and the cost to obtain any endorsements to the American
Land Title Association owner's title policy delivered at the Closing (other than
the endorsements obtained by Seller as described above). Escrow fees and other
incidental charges of Escrow Agent shall be paid one-half by Seller and one-half
by Purchaser.
26. RETURN OF THE DOWNPAYMENT
Notwithstanding anything to the contrary contained herein, if Purchaser
terminates this Agreement pursuant to any of the provisions hereof, and if at
the time of such termination (1) any broker (other than the Broker), finder or
other person is claiming that they are entitled to a fee commission or other
compensation arising out of the transaction contemplated in this Agreement by
reason of any alleged agreement with Purchaser, or (2) Purchaser has breached
the confidentiality requirements contained in Section 23, then the Downpayment
(or the portion thereof which is necessary to compensate Seller for its losses
and for damages relating to the matters described in (1) and (2) above) shall
continue to be held in escrow and shall not be
47
released to Purchaser until Purchaser has compensated Seller for all of Seller's
losses and/or damages relating to the matters described in (1) and (2) above.
27. EXISTING BUENAVENTURA LITIGATION
Seller has disclosed to Purchaser the existence of the Buenaventura Development
Litigation. Promptly following the Closing, Purchaser shall (a) assume the
prosecution and/or defense of the Buenaventura Development Litigation and (b) be
substituted as the "party-in-interest" for Seller in such lawsuits. Seller and
Purchaser shall execute and deliver such documents as may be reasonably
necessary to effectuate the substitution referred to in this Section 27.
Purchaser hereby agrees to (a) assume responsibility for all costs and expenses
(including, without limitation, attorneys' fees and expenses) incurred after the
Closing Date in connection with the Buenaventura Development Litigation,
including all costs and expenses in connection with the substitution of
Purchaser for Seller as the "party-in-interest," and (b) to indemnify Seller and
Seller's Affiliates and to hold Seller and Seller's Affiliates harmless from any
and all costs and expenses (including, without limitation, attorneys' fees and
expenses) that Seller or Seller's Affiliates may incur after the Closing Date in
connection with the Buenaventura Development Litigation, including costs related
to discovery. Seller has advised Purchaser that Seller and the City of San
Buenaventura have held discussions regarding the reimbursement of Seller for 50%
of the costs and expenses incurred in connection with the Buenaventura
Development Litigation (the "Litigation Costs") in excess of $100,000. Seller
anticipates entering into an agreement with the City of San Buenaventura with
respect to such reimbursement prior to the Closing, which agreement will be
subject to Purchaser's prior written approval (which approval will not be
unreasonably withheld or delayed), and which agreement will be assigned to
Purchaser at the Closing. To the extent Purchaser recovers any moneys from the
City of San Buenaventura on account of such reimbursement obligations, Purchaser
shall pay to Seller the first $75,000 of such moneys (and Purchaser shall have
the right to retain any moneys in excess of such $75,000). Purchaser shall act
reasonably, and shall cooperate with Seller (at no cost or expense to
Purchaser), in seeking such reimbursement from the City of San Buenaventura.
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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.
MCA BUENAVENTURA ASSOCIATES, L.P.,
a Delaware limited partnership
By: MCA BUENAVENTURA INC.,
its general partner
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------
▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ LIMITED
PARTNERSHIP,
a California limited partnership
By: MACERICH BUENAVENTURA GP CORP.,
a Delaware corporation
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------
Title: General Counsel and Secretary
------------------------------
Solely for the purpose of
agreeing to the provisions
of Section 19:
COMMONWEALTH LAND TITLE
INSURANCE COMPANY, Escrow Agent
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------
Title: Escrow Agent
-------------------------------
49
TABLE OF DEFINED TERMS
The following capitalized terms are defined in the respective Section of
the Agreement identified below:
"A & A AGREEMENTS" - as such term is defined in Section 10(d) hereof.
"ADDITIONAL RENTS" - as such term is defined in Section 3(c)(iii) hereof.
"AGREEMENT" - as such term is defined in the opening paragraph hereof.
"ANCHOR LEASE" - as such term is defined in Section 7(a)(i)(E) hereof.
"APPROVED INSTITUTION" - as such term is defined in Section 19(d) hereof.
"APPROVED INVESTMENT" - as such term is defined in Section 19(d) hereof.
"ASSUMED CLAIMS" - as such claim is defined in Section 7(a)(i)(D).
"▇▇▇▇ OF SALE" - as such term is defined in Section 10(f) hereof.
"BUENAVENTURA DEVELOPMENT LITIGATION" - as such term is defined in
Section 7(a)(i)(D).
"BUILDINGS" - as such term is defined in Section 1 hereof.
"CLOSING" - as such term is defined in Section 4(b) hereof.
"CLOSING DATE" - as such term is defined in Section 4(b) hereof.
"CONTRACT AND LICENSE ASSIGNMENT" - as such term is defined in Section 10(c)
hereof.
"CONTRACTS" - as such term is defined in Section 10(c) hereof.
"DEED" - as such term is defined in Section 10(a) hereof.
"DOWNPAYMENT" - as such term is defined in Section 2(a) hereof.
1
"ESCROW AGENT" - as such term is defined in Section 2(a) hereof.
"ENVIRONMENTAL AUDIT - as such term is defined in Section 4(a).
"INTANGIBLE PROPERTY" - as such term is defined in Section 1 hereof.
"INTANGIBLE PROPERTY ASSIGNMENT" - as such term is defined in Section 10(d)
hereof.
"LAND" - as such term is defined in Section 1 hereof.
"LAWS" - as such term is defined in Section 7(a)(i)(C) hereof.
"LEASE ASSIGNMENT" - as such term is defined in Section 10(b) hereof.
"LEASES" - as such term is defined in Section 1 hereof.
"LICENSE AND INDEMNITY AGREEMENT" - as such term is defined in Section 13(b)
hereof.
"LICENSES" - as such term is defined in Section 11(c) hereof.
"LIENS" - as such term is defined in Section 6(b) hereof.
"LITIGATION COSTS" - as such term is defined in Section 27 hereof.
"MANAGER" - as such term is defined in Section 3(a)(iv).
"NEW LEASE" - as such term is defined in Section 12(a)(ii) hereof.
"NEW LEASE EXPENSES" - as such term is defined in Section 12(a)(ii) hereof.
"EXISTING FIRST MORTGAGE LOAN" - as such term is defined in
Section 7(a)(i)(C).
"NOTICE OF OBJECTION" - as such term is defined in Section 19(b)(i) hereof.
"OTHER SALE AGREEMENTS" - as such term is defined in Section 9(a)(vii)
hereof.
"PERMITTED ENCUMBRANCES" - as such term is defined in Section 5 hereof.
2
"PERSONAL PROPERTY" - as such term is defined in Section 1 hereof.
"PROPERTY" - as such term is defined in Section 1 hereof.
"PROPERTY INFORMATION" - as such term is defined in Section 23(d) hereof.
"PURCHASE PRICE" - as such term is defined in Section 2 hereof.
"PURCHASER" - as such term is defined in the opening paragraph hereof.
"PURCHASER'S DOCUMENTS" - as such term is defined in Section 7(b)(i)(B)
hereof.
"PURCHASER'S REPRESENTATIVES" - as such term is defined in Section 23(d)
hereof.
"RECOVERABLE EXPENSES" - as such term is defined in Section 3(c)(iii).
"RECOVERIES" - as such term is defined in Section 3(c)(iii).
"RENT COMMENCEMENT DATE" - as such term is defined in Section 12(a)(iii)
hereof.
"RETAINED CLAIMS" - as such term is defined in Section 7(a)(i)(D).
"SELLER" - as such term is defined in the opening paragraph hereof.
"SELLER'S AFFILIATES" - as such term is defined in Section 24(e) hereof.
"SELLER'S DOCUMENTS" - as such term is defined in Section 7(a)(i)(B) hereof.
"SELLER'S KNOWLEDGE" - as such term is defined in Section 7(a) hereof.
"SHOPPING CENTER" - as such term is defined in the Preamble.
"SHOPPING CENTER AGREEMENTS" - as such term is defined in Section 1 hereof.
"SHOPPING CENTER AGREEMENT ASSIGNMENT" - as such term is defined in
Section 10(p).
"SURVIVING OBLIGATIONS" - as such term is defined in Section 9(c) hereof.
3
"TITLE COMMITMENT" - as such term is defined in Section 6(a)(i) hereof.
"TITLE COMPANY" - as such term is defined in Section 2(a) hereof.
"UNACCEPTABLE ENCUMBRANCES" - as such term is defined in Section 6(a)(i)
hereof.
"▇▇▇▇▇ FARGO CREDIT AGREEMENT" - as such term is defined in
Section 7(b)(i)(c).
"▇▇▇▇▇ FARGO CONSENT" - as such term is defined in Section 7(b)(i)(c).
4