EXHIBIT 10.14
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AMENDED AND RESTATED REAL ESTATE PURCHASE
AND SALE AGREEMENT
by and between
Transwestern Heights, L.P.
and
Triple Net Properties, LLC
Dated as of July 24, 2002
for
University Heights Business Park
San Antonio, TX
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TABLE OF CONTENTS
Page
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SUMMARY STATEMENT ......................................................... II
1. AGREEMENT FOR PURCHASE AND SALE ....................................... 1
2. PURCHASE PRICE AND ▇▇▇▇▇▇▇ MONEY ...................................... 2
3. CLOSING ............................................................... 3
4. ESCROW ................................................................ 3
5. CONVEYANCE ............................................................ 3
6. TITLE COMMITMENT ...................................................... 3
7. SURVEY ................................................................ 4
8. REPRESENTATIONS AND WARRANTIES ........................................ 4
9. SELLER'S COVENANTS .................................................... 7
10. PURCHASER'S CONDITIONS TO CLOSING ..................................... 8
11. DELIVERY OF DOCUMENTS ................................................. 9
12. FIRE OR CASUALTY ...................................................... 13
13. CONDEMNATION .......................................................... 14
14. ADJUSTMENTS AND PRORATIONS ............................................ 14
15. REQUIRED TENANTS ...................................................... 16
16. CLOSING COSTS ......................................................... 16
17. POSSESSION ............................................................ 17
18. DEFAULT ............................................................... 17
19. NOTICES ............................................................... 17
20. BROKERS ............................................................... 18
21. LEASING COSTS, MANAGEMENT FEES AND EMPLOYEES .......................... 18
22. "AS IS" SALE .......................................................... 19
23. OFFER AND ACCEPTANCE .................................................. 20
24. MISCELLANEOUS ......................................................... 20
Exhibits
A - Legal Description of Land
B - List of Equipment, Fixtures and Personal Property
C - Rent Roll
D - List of Contracts
E - List of Licenses
F - Escrow Instructions
G-l - Special Warranty Deed
G-2 - ▇▇▇▇ of Sale
G-3 - Assignment of Contracts, Licenses, Leases and Intangibles
H - Disclosure of Lease Matters/Pending Commissions
I - Telecommunications Agreements to be Assumed by Purchaser
J - Tenant Estoppel Letter
K - Recertification of Representations and Warranties
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AMENDED AND RESTATED REAL ESTATE PURCHASE AND SALE AGREEMENT
Summary Statement
This Summary Statement is attached to and made a part of that certain
Amended and Restated Real Estate Purchase and Sale Agreement dated as of the
Date of Agreement by and between the Seller and Purchaser referenced below.
1. DATE OF AGREEMENT: July 24, 2002
2. SELLER: Transwestern Heights, L.P., a Delaware limited
partnership
3. PURCHASER: Triple Net Properties, LLC, a Virginia limited
liability company
4. PROPERTY DESCRIPTION: University Heights Business Park
a) Address: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
b) Nature of Improvements: 2 building office/flex park
c) Rentable Square Footage: Approximately 68,400 square feet
5. PURCHASE PRICE: $6,750,000
6. ▇▇▇▇▇▇▇ MONEY: $250,000
7. ADDITIONAL ▇▇▇▇▇▇▇ MONEY: Intentionally deleted
8. APPROVAL DATE: Date of Agreement
9. CLOSING DATE: 30 days after the Date of Agreement, August
22, 2002
10. TITLE COMPANY: First American Title Insurance Company - to
be coordinated between the Chicago and San
Antonio offices
11. PURCHASER'S MAILING Triple Net Properties, LLC
ADDRESS: ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
The Federal Reserve Bank Building
▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
12. BROKERS: Transwestern Commercial Services and Triple
Net Properties Realty, Inc.
13. GOVERNING STATE LAW: Texas
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AMENDED AND RESTATED REAL ESTATE PURCHASE AND SALE AGREEMENT
THIS AMENDED AND RESTATED REAL ESTATE PURCHASE AND SALE AGREEMENT
("Agreement") is made and entered into as of the Date of Agreement by and
between Transwestern Heights, L.P., a Delaware limited partnership ("Seller"),
and Triple Net Properties, LLC, a Virginia limited liability company
("Purchaser").
RECITALS
A. Seller is the owner of certain real property legally described in
Exhibit "A" attached hereto (the "Land") and all buildings, fixtures and other
improvements situated on the Land (collectively, the "Improvements"), said Land
and the Improvements are described on Line 4 of the preceding Summary Statement
which is attached to and incorporated into this Agreement (the "Summary
Statement").
B. Seller desires to sell to Purchaser, and Purchaser desires to
purchase from Seller, the Land and the Improvements, together with all of the
other property and interests of Seller described in Section 1 below, subject to
the terms and conditions contained herein.
C. Seller and Purchaser previously contracted for the sale of the
Property under the terms of a Purchase and Sale Agreement dated December 4, 2001
which agreement was previously terminated but which understanding is restated
and amended by virtue of this Agreement.
AGREEMENTS
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Seller and Purchaser agree as
follows:
1. AGREEMENT FOR PURCHASE AND SALE. Seller agrees to sell, and Purchaser
agrees to purchase, subject to the terms and conditions contained herein, the
Land and the Improvements, together with all of Seller's right, title and
interest in and to:
(a) (i) all rights of way, tenements, hereditaments, easements,
rights, interests, claims, minerals and mineral rights, water and water
rights, utility capacity and appurtenances, if any, in any way belonging
or appertaining to the Land and the Improvements and (ii) all of
Seller's right, title and interest in and to all adjoining streets,
alleys, roads, parking areas, curbs, curb cuts, sidewalks, landscaping,
signage, sewers and public ways (collectively, the "Appurtenant
Rights"); and
(b) all equipment and fixtures owned by Seller attached to the
Improvements and located at and used in connection with the ownership,
operation and maintenance of the Land or the Improvements, including
without limitation all heating, lighting, air conditioning,
ventilating, plumbing electrical or other mechanical equipment and the
personal property located at the Land or the Improvements, if any, and
listed in Exhibit "B" attached hereto (collectively, the "Personal
Property"); and
(c) all leases, tenancies and rental or occupancy agreements granting
possessory rights in, on or covering the Land or Improvements, together
with all modifications, extensions, amendments and guarantees thereof, to
the extent set forth in Exhibit "C" attached hereto, together with such
other leases of the Improvements as may be made prior to Closing in
accordance with the terms of this Agreement (collectively, the "Leases");
and
(d) to the extent assignable, all contracts, Telecommunications
Agreements (as hereinafter defined), agreements, guarantees, warranties and
indemnities, written or oral, if any, affecting the ownership, operation,
management and maintenance of the Land, Improvements, Appurtenant Rights,
Personal Property and Leases, including without limitation those items
listed in Exhibit "D" attached hereto (collectively, the "Contracts"); and
(e) to the extent assignable (i) Seller's right to use the name
"University Heights", (ii) all plans, models, drawings, specifications,
blueprints, surveys, engineering reports, environmental reports and other
technical descriptions or materials relating in any way to the Land,
Improvements, Appurtenant Rights, Personal Property, Leases or Contracts,
and (iii) all licenses, franchises, certificates, occupancy and use
certificates, permits, authorizations, consents, variances, waivers,
approvals and the like from any governmental or quasi-governmental entity
or instrumentality affecting the ownership, operation or maintenance of the
Land or the Improvements, including without limitation the items listed in
Exhibit "E" attached hereto (collectively, the "Licenses"); and
(f) to the extent assignable, all financial statements and
maintenance records prepared by or on behalf of Seller in connection with
the ownership, operation and maintenance of the Property (as defined below)
(collectively, the "Intangibles").
The Land, Improvements, Appurtenant Rights, Personal Property, Leases,
Contracts, Licenses and Intangibles and other property described above are
collectively referred to herein as the "Property."
2. PURCHASE PRICE AND ▇▇▇▇▇▇▇ MONEY. The purchase price for the Property
(the "Purchase Price") shall be the amount set forth in Line 5 of the Summary
Statement. The Purchase Price, plus or minus prorations and adjustments provided
for herein, shall be paid in cash or cash equivalent to Seller on or before 2:00
p.m. (Chicago time) on the Closing Date (as hereinafter defined). On the Date of
Agreement, Purchaser shall deposit into the Escrow (as hereinafter defined) cash
or certified funds in the amount set forth in Line 6 of the Summary Statement as
a non-refundable (except as otherwise provided herein) ▇▇▇▇▇▇▇ money deposit
(the "▇▇▇▇▇▇▇ Money"). The ▇▇▇▇▇▇▇ Money shall be invested in accordance with
Seller's direction and, except as otherwise provided herein, all interest earned
on the ▇▇▇▇▇▇▇ Money shall remain the property of and be paid to Seller. The
cost of the investment of the ▇▇▇▇▇▇▇ Money shall be paid from the interest
earned thereon before such interest is paid out by Title Company. Upon the
closing of the transaction contemplated by this Agreement, the ▇▇▇▇▇▇▇ Money
shall be paid to Seller and Purchaser shall receive a credit against the
Purchase Price in the amount thereof. If the transaction does not so close, the
▇▇▇▇▇▇▇ Money shall be disbursed in accordance with the terms of this Agreement.
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3. CLOSING. Subject to terms and conditions of this Agreement, the closing
of the transaction contemplated by this Agreement (the "Closing") shall take
place on the date set forth on Line 9 of the Summary Statement (the "Closing
Date") at the offices of Title Company, or as the parties shall otherwise agree.
4. ESCROW. This transaction shall be closed through an escrow established
with Title Company in accordance with the deed and money escrow instructions in
the form attached hereto as Exhibit "F" (the "Escrow"). Upon the creation of the
Escrow, anything herein to the contrary notwithstanding, the transfer and
conveyance of the Property, the payment of funds and the delivery of the
Conveyance Documents and other documents required to close the transaction
contemplated by this Agreement shall be made through the Escrow. At the option
of either Purchaser or Seller, the Closing shall also take place through a
so-called "New York Style" closing, so that the Title Policy will be delivered
to Purchaser on the Closing Date. All escrow costs, including the costs of the
Escrow and any New York Style closing fees, shall be divided equally between
Purchaser and Seller.
5. CONVEYANCE. On the Closing Date, Seller shall transfer and convey title
to the Property to Purchaser free and clear of all liens and encumbrances, other
than real and personal property taxes not yet due and payable and such title
exceptions as may be permitted pursuant to Section 6 below (collectively, the
"Permitted Exceptions"), by:
(a) delivering a recordable special warranty deed, in the form of
Exhibit "G-1" attached hereto, subject only to the Permitted Exceptions,
executed by Seller, that conveys fee simple title to the Land, Improvements
and Appurtenant Rights to Purchaser;
(b) delivering a ▇▇▇▇ of sale, in the form of Exhibit "G-2" attached
hereto, executed by Seller, that transfers the Personal Property to
Purchaser; and
(c) delivering an assignment and assumption, in the form of Exhibit
"G-3" attached hereto, executed by Seller, that transfers all of Seller's
right, title, and interest in and to the Contracts, the Licenses, the
Telecommunications Agreements, the Leases and the Intangibles to Purchaser
(the "Assignment and Assumption").
The foregoing documents and instruments are collectively referred to herein as
the "Conveyance Documents".
6. TITLE COMMITMENT. Within ten (10) business days after the Date of
Agreement Seller shall deliver to Purchaser a current Texas form title
commitment (or such other comparable form as may be reasonably acceptable to
Purchaser and customary in the state where the Property is located) (the "Title
Commitment") for an owner's title insurance policy issued by the title company
identified in Line 10 of the Summary Statement (the "Title Company") in the
amount of the Purchase Price, covering title to the Land, Improvements and
Appurtenant Rights, together with legible copies of each of the documents
underlying the title exceptions listed therein. On or before the date which is
five (5) days after Purchaser's receipt of the Title Commitment ("Title
Objection Date"), Purchaser will notify Seller in writing as to those title
exceptions listed in the Title Commitment which it will accept as Permitted
Exceptions (the
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"Exception Notice"). If Purchaser fails to provide Seller the Exception Notice
on or before the Title Objection Date, the title exceptions listed in the Title
Commitment shall be deemed to be Permitted Exceptions and Purchaser shall be
deemed to have waived its right to object to such exceptions. Seller shall have
the right, but not the obligation, until the sooner of (x) the Closing Date, or
(y) the date which is ten (10) days after the date Seller receives the Exception
Notice (the sooner of which is hereinafter referred to as the "Title Clearance
Date") to have all title exceptions other than Permitted Exceptions
(collectively, the "Unpermitted Exceptions") removed from the Title Commitment
or to have Title Company commit to insure, at Seller's expense, against any and
all loss or damage that may be occasioned by any such Unpermitted Exceptions. If
Seller fails on or before the Title Clearance Date to reasonably demonstrate to
Purchaser that the Unpermitted Exceptions have been removed, or in the
alternative, that Seller has obtained a commitment for title indemnification or
title insurance over such Unpermitted Exceptions in form reasonably acceptable
to Purchaser, then, in either such case, Purchaser shall, as its sole remedy,
have the option (the "Title Election") to either (i) terminate this Agreement,
whereupon the parties hereto shall have no further obligations hereunder (except
for obligations which are expressly intended to survive the termination of this
Agreement), and receive a return of the ▇▇▇▇▇▇▇ Money, or (ii) proceed with
Closing, in which event the Purchase Price shall be reduced by an amount equal
to the aggregate amount of all tax, judgment, mechanics' and lender's liens of a
definite and ascertainable amount that constitute Unpermitted Exceptions and
Purchaser shall be deemed to have waived any objection to any other Unpermitted
Exceptions. If Purchaser fails to notify Seller of its Title Election within
five (5) days after the Title Clearance Date, Purchaser shall be deemed to have
elected to proceed with the Closing, as set forth in subclause (ii) above. The
provisions of this Section 6 shall survive the termination of this Agreement.
Notwithstanding the foregoing, Purchaser acknowledges and agrees that Seller
recently refinanced the Property and in connection therewith provided a title
insurance policy (number 00908922) dated April 15, 2002 and hand marked May
1, 2002 from the Title Company to its lender, National City Bank, a copy of
which has been provided to Purchaser (the "Existing Lender's Title") and that
all exceptions from coverage other than the loan insured thereby listed in such
Existing Lender's Title shall constitute Permitted Exceptions for purposes of
this Agreement. In addition, anything contained in this Agreement to the
contrary, the Purchaser shall be responsible for the cost of any title insurance
premium in excess of title insurance coverage of $6,600,000.
7. SURVEY.
Seller has delivered to Purchaser a copy of an ALTA/ACSM land title survey
of the Property dated April 30, 2002 and prepared by Bury & Partners, Inc. (the
"Existing Survey"). Purchaser at its option and expense may obtain an update of
the Existing Survey (the "Survey"), dated on or after the date of this Agreement
and prepared by a land surveyor licensed by the state in which the Land is
located. Any Survey shall be certified to Seller, Purchaser, the Purchaser's
lender (if any), and Title Company.
On or before the date which is five (5) days after Purchaser's receipt of
the Survey but in any event not less than five (5) business days prior to the
Closing Date (the "Survey Objection Date"), Purchaser will notify Seller in
writing as to those material encroachments, gaps, gores and other matters
depicted on the Survey which Purchaser shall not accept (the "Survey Defects").
If Purchaser fails to provide Seller with written notice of any Survey Defects
on or before the Survey Objection Date, Purchaser shall be deemed to have waived
its right to object to matters of survey (and to any related title exceptions
raised on the Title Commitment in
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connection with survey matters). Seller shall have the right, but not the
obligation, until the sooner of (x) the Closing Date, or (y) the date which is
ten (10) days after the date Seller receives notice of the Survey Defects (the
soonest of which is hereinafter referred to as the "Survey Clearance Date") to
have the Survey Defects removed from the Survey or to have Title Company commit
to insure, at Seller's expense, against any and all loss or damage that may be
occasioned by any such Survey Defect. If Seller fails on or before the Survey
Clearance Date to reasonably demonstrate to Purchaser that the Survey Defects
have been removed, or in the alternative, that Seller has obtained a commitment
for title indemnification or title insurance over such Survey Defect, then, in
either case, Purchaser shall, as its sole remedy, have the option (the "Survey
Election") to either (a) terminate this Agreement, whereupon the ▇▇▇▇▇▇▇ Money
shall be returned to Purchaser and the parties hereto shall have no further
obligations hereunder (except for obligations which are expressly intended to
survive the termination of this Agreement), or (b) proceed with Closing, in
which case Purchaser shall be deemed to have waived any objection to such Survey
Defects. If Purchaser fails to notify Seller of its Survey Election within ten
(10) days after the Survey Clearance Date, Purchaser shall be deemed to have
elected to proceed with the Closing as set forth in subclause (ii) above.
Notwithstanding the foregoing, Purchaser acknowledges and agrees that nothing
contained in or set forth on the Existing Survey shall constitute a Survey
Defect for purposes of this Agreement.
8. REPRESENTATIONS AND WARRANTIES.
(a) As used in this Section 8, references to "Seller's actual
knowledge" shall mean the actual knowledge of ▇▇▇▇ ▇▇▇▇, the property
manager, without investigation or inquiry of any other person or entity.
Seller represents and warrants to Purchaser, as of the date hereof and
again on the Closing Date, as follows:
(i) Except as shown on (x) the rent roll attached hereto
as Exhibit "C" (as to the representation made on the date of this
Agreement), (y) the rent roll delivered on the Closing Date
pursuant to Section 11(b)(x) below (as to the representation made
as of the Closing Date) (as applicable, the "Rent Roll") or (z)
the Title Commitment, there are no persons in possession or
occupancy of the Property, or any part thereof, nor are there any
persons who have possessory rights with respect to the Property or
any part thereof;
(ii) During its period of ownership, Seller has received
no written notice from any governmental authority of any violation
of applicable laws, ordinances or regulations related to the
Property or the occupancy thereof which have not been heretofore
corrected, nor any written notice of increases in insurance
premiums;
(iii) To Seller's actual knowledge, neither the execution
or delivery of this Agreement, the consummation of the
transactions contemplated hereby, nor the fulfillment of or
compliance with the terms and conditions hereof conflict with or
result in a material breach of any of the terms, conditions or
provisions of any agreement or instrument to which the Seller is a
party or by which Seller is bound;
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(iv) Except as set forth in Sections 14(h), 20 and 21 below and as
set forth in Exhibit "H" below (the "Pending Commissions"), Seller has
entered into no brokerage or leasing commission agreements with respect to
the Property, where a commission or fee has been earned but not fully paid;
(v) There are no contracts or agreements affecting the operation
of the Land or the Improvements (including without limitation management,
maintenance, service, supply, purchase, consulting, advertising, promotion,
public relations and construction contracts, agreements, commitments,
guarantees and warranties) which will survive Closing and be binding upon
Purchaser except as disclosed in Exhibits "D" and "I" attached hereto
and to Seller's actual knowledge, no party is in default under any such
contracts;
(vi) To Seller's actual knowledge, there are no claims, causes of
action, lawsuits or legal proceedings pending or threatened regarding the
ownership, use or possession of the Property, including without limitation
condemnation or similar proceedings;
(vii) Seller is duly organized, validly existing and in good
standing under the laws of the State of Delaware, and is qualified to do
business under the laws of the State of Texas. Seller has all necessary
power and authority to enter into this Agreement and to consummate all of
the transactions contemplated herein. The individuals executing this
Agreement on behalf of Seller (or on behalf of partners of Seller) are duly
authorized to execute, deliver and perform this Agreement on behalf of
Seller (or on behalf of partners of Seller) and to bind Seller. This
Agreement and all documents to be executed by Seller and delivered to
Purchaser hereunder (A) are and will be the legal, valid and binding
obligations of Seller, enforceable in accordance with their terms, (B) do
not or will not contravene any provision of Seller's organizational
documents or any existing laws and regulations applicable to Seller or the
Property and (C) will not conflict with or result in a violation of any
agreement, instrument, order, writ, judgment or decree to which Seller is a
party or is subject or which governs the Property;
(viii) Seller has received no notice of any claims, causes of
action, lawsuits or legal proceedings pending or threatened regarding the
ownership, use or possession of the Property;
(ix) To Seller's actual knowledge, all Leases, Contracts and
operating statements delivered to Purchaser by Seller that were entered
into and/or pertain to the period when Seller owned the Property shall be
true and correct in all material respects; and
(x) To Seller's actual knowledge, during the period of time that
Seller has owned the Property, (A) Seller has not conducted or authorized
the generation, transportation, storage, treatment or disposal at or from
the Property of any Hazardous Substances (as defined in Section 22) in
violation of any applicable environmental laws, and (B) Seller has not
received any written notice
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of, any generation, transportation, storage, treatment or disposal at
or from the Property of any Hazardous Substance in violation of any
applicable environmental laws.
(b) Purchaser represents and warrants to Seller, now and again on the
Closing Date, that: (i) Purchaser has all necessary power and authority
to enter into this Agreement and to consummate all the transactions
contemplated herein, (ii) the individuals executing this Agreement on
behalf of Purchaser are duly authorized to execute, deliver and perform
this Agreement on behalf of Purchaser and to bind Purchaser and (iii) this
Agreement and all documents to be executed by Purchaser and delivered to
Seller hereunder (A) are and will be the legal, valid and binding
obligations of Purchaser, enforceable in accordance with their terms, (B)
do not or will not contravene any provision of Purchaser's organizational
documents or any existing laws and regulations applicable to Purchaser and
(C) will not conflict with or result in a violation of any agreement,
instrument, order, writ, judgment or decree to which Purchaser is a party
or is subject.
(c) All of the representations and warranties of Seller and Purchaser
contained in this Section 8 are material, none shall merge into the deed
herein provided for and all shall survive the Closing Date or termination
of this Agreement for a period of six (6) months ("Survival Period"). All
rights of Purchaser hereunder with respect to any surviving representation,
warranty or covenant shall be deemed waived if Purchaser does not, by
written notice to Seller, advise Seller of any alleged breach of
representation, warranty or covenant prior to the expiration of the
Survival Period. Subject to the limitations set forth in the immediately
preceding sentence, all remedies shall be those set forth in Section 18
below, and notwithstanding anything herein to the contrary, Seller's
liability under any representation, warranty or covenant made hereunder or
in any of the Closing Documents shall in no event exceed Seller's Maximum
Liability (as hereinafter defined).
9. SELLER'S COVENANTS. From and after the date of this Agreement through
the Closing Date, Seller and Seller's agents shall at Seller's expense:
(a) maintain the Property in the condition in which it existed as of
the date of this Agreement, normal wear and tear excepted, free from
mechanics' liens or other claims for liens, and operate the Property in a
manner consistent with current practice and perform its obligations under
the Leases, Contracts and Licenses;
(b) keep in existence all fire and extended coverage insurance
policies, and all public liability insurance policies, that are in
existence as of the date of this Agreement with respect to the Property;
(c) not amend, waive any rights under, terminate or extend any Lease,
Contract, License or Telecommunications Agreement, nor apply any security
or other deposits held under any Lease, Contract, License or
Telecommunications Agreement to delinquent rents, nor enter into any new
lease, license or telecommunications agreement
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affecting the Premises whose term would extend beyond the Closing Date
without Purchaser's prior written consent, which will not be unreasonably
withheld;
(d) upon at least twenty four (24) hours notice to Seller, permit
Purchaser, its engineer, architect or other agents, during normal business
hours (or such other times as are reasonable), to enter onto the Property
for the purpose of making inspections thereof;
(e) grant Purchaser access to any records, books and agreements
concerning the Property within Seller's possession or control (with the
exception of any such documents that Seller deems confidential or
proprietary), and maintain such records, books and accounts in Seller's
ordinary manner consistent with past practice;
(f) promptly advise Purchaser in writing of any changes in
circumstances which would render the representations and warranties made
by Seller herein false or misleading;
(g) upon written notice from Purchaser on or before Closing, give
appropriate notices of termination of Contracts designated by Purchaser
(but only to the extent termination is permitted thereunder without a
penalty); provided, however, that if the notice period required to
terminate such contracts will not have run prior to Closing, Seller shall
assign and Purchaser shall assume any remaining rights and obligations
under such Contracts pursuant to the Assignment and Assumption; and
(h) provide Purchaser with any other relevant information with
respect to the Property upon Purchaser's reasonable request.
Notwithstanding anything to the contrary contained in Section 9(g) above,
Purchaser shall not have the right to request Seller to terminate the
telecommunications licenses, riser management agreements or rooftop contracts
described on Exhibit "I" attached hereto ("Telecommunications Agreements"), and
at Closing Seller shall assign to Purchaser, and Purchaser shall assume from
Seller, the Telecommunications Agreements pursuant to the Assignment and
Assumption.
10. PURCHASER'S CONDITIONS TO CLOSING.
(a) Purchaser and Seller acknowledge and agree that Purchaser has
previously had full access to the Property for the purposes of conducting
its inspections thereof and has completed such inspections and testing to
its full satisfaction. Purchaser expressly waives any further right to
conduct due diligence and to object to the results thereof.
(b) Seller shall use commercially reasonable efforts to obtain
and deliver to Purchaser, in sufficient time to permit Purchaser to
conduct a reasonable review thereof prior to Closing, estoppel
certificates from tenants who in the aggregate occupy at least
seventy-five percent (75%) of the occupied rentable square footage of the
Property and shall include the following tenants: (i) USA, General
Services Administration ("GSA"), (ii) The PaceSetter Corporation, and
(iii) Computer Express (such three tenants are referred to herein as the
"Required Tenants") in the form attached as Exhibit "J" or in
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such other form as may be reasonably acceptable to Purchaser and Seller.
Notwithstanding the foregoing, Seller's failure to deliver such estoppel
certificates shall in no instance constitute a default by Seller under this
Agreement and in the event of such failure, Purchaser's sole right shall be
either (i) to terminate this Agreement in which case the ▇▇▇▇▇▇▇ Money, and all
interest earned thereon shall be returned to Purchaser, or (ii) to waive the
requirement for such estoppel certificates (to the extent not provided) and
proceed with the Closing. Seller also agrees to present to the tenants of the
Property for consideration and execution and use reasonable efforts to obtain
Purchaser's lender's requested from of subordination, non-disturbance and
attornment agreement ("SNDA"). Purchaser acknowledges that failure to obtain
SNDA's from any tenant shall not impact its obligations hereunder. Purchaser
understands and agrees that the lease with GSA specifies the information which
GSA must provide in an estoppel and/or SNDA and Seller shall be deemed to have
complied with the requirements of this Section 10(b) so long as the estoppel
and/or SNDA provided by GSA complies with the requirement's of GSA's lease.
(c) The obligation of Purchaser to close the transaction contemplated by
this Agreement is further subject to the condition that: (i) all of the
representations and warranties of Seller contained in this Agreement are true
and correct, in all material respects, at the date hereof and as of the Closing
Date, and (ii) all of the obligations and duties of Seller to be performed
hereunder on or before the Closing Date have been substantially completed in a
timely manner. Purchaser shall give written notice to Seller within five (5)
days after Purchaser's receipt of any notice disclosing that any Seller
representation and warranty is no longer true and correct; provided, however,
that Purchaser's failure to give such written notice shall in no instance
constitute a default by Purchaser under this Agreement but shall instead only
serve to bar Purchaser from raising such matter as a failure of a condition
precedent to Purchaser's obligation to close the transaction and Purchaser's
election to proceed with the Closing shall result in Purchaser's waiver of any
remedy resulting from the incorrectness in such representation of warranty.
(d) All information, data and documents relating to the Property
(including, without limitation, those furnished pursuant to the terms and
provisions of Section 11) obtained by Purchaser from Seller or any other party
or discovered by Purchaser during the term of this Agreement shall be maintained
by Purchaser in strict confidence and may not be revealed to any other party
except Purchaser's employees and contractors but then only if Purchaser has
obtained an agreement executed by the party to whom such information is revealed
whereby such party agrees to maintain such information in strict confidence and
not reveal any such information to any other party.
11. DELIVERY OF DOCUMENTS.
(a) Within three (3) business days of the Date of Agreement, Seller shall
provide Purchaser with access to, or otherwise make available to Purchaser the
following updated information, to the extent in the possession or control of
Seller. Purchaser expressly acknowledges and agrees that such updated
information is being provided on an informational basis only and nothing
contained therein shall entitle Purchaser to
9
terminate this Agreement. Seller's updating obligation shall cover new
information from January 1,2002 through the Date of Agreement:
(i) the most recent (for the prior twelve (12) months)
real estate and personal property tax bills, notices of assessed
valuation and utility bills relating to the Property;
(ii) all surveys, certificates of occupancy, certificates
or other evidence of compliance (or notices of violation) with
applicable laws, engineering data, floor plans, "as built" or working
drawings, site plans, specifications, appraisals and title
policies relating to the Property;
(iii) the Leases (executed and/or out for signature),
tenants' files and Lease correspondence, commission agreements,
together with the most current Rent Roll for the Property;
(iv) the Contracts and Licenses;
(v) operating statements from and after 1999, general
ledgers, and trial balances maintained or prepared for the Property;
(vi) current aging reports;
(vii) all material audits, reports, test results,
notifications and correspondence relating to the environmental
condition or operation of the Property; and
(viii) all material data, correspondence, documents,
agreements with, notices to or from, or applications to, any taxing
authorities, governmental agencies, utilities, vendors, tenants and
mortgagees with respect to the Property that are in Seller's
possession or control, all other documents material to the condition,
maintenance or operation of the Property, and all other information
and documents relating to the Property as Purchaser shall reasonably
request.
(b) On the Closing Date, Seller shall deliver the following
documents (the "Closing Documents") to Purchaser, in form and substance
reasonably acceptable to Purchaser all duly executed, where appropriate, each
of which shall be a condition precedent to Purchaser's obligation to close the
transaction contemplated by this Agreement (and one or more of which may be
waived in writing by the Purchaser, in its sole discretion, on or prior to the
Closing Date):
(i) the Conveyance Documents, executed by Seller;
(ii) to the extent required by the title company, a title
affidavit in customary form executed by Seller;
(iii) Seller's counterpart of a closing and proration
statement, executed by Seller;
10
(iv) a certification of nonforeign status satisfying
Section 1445 of the Internal Revenue Code of 1986, as amended,
executed by Seller;
(v) executed counterparts of real estate transfer
declarations, disclosures or forms executed on behalf of Seller;
(vi) evidence of Seller's existence and authority to
perform its obligations under this Agreement, in form and
substance reasonably satisfactory to Purchaser and Title
Company;
(vii) if a New York Style closing is used, (A) a gap
undertaking, executed by Seller, and (B) the Title Commitment,
hand-marked, initialed and dated as of the Closing Date so as to
be the equivalent of the Title Policy (or a pro forma title
policy) subject only to the Permitted Exceptions (the "Title
Policy");
(viii) all keys and access cards to, and combinations
to locks and other security devices located at, the Property, if
applicable;
(ix) all of the original Leases, Contracts and
Licenses in possession of Seller, and originals of all other
materials delivered pursuant to Section 11(a) above, where
available, together with (A) a letter from Seller advising the
tenants under the Leases of the assignment of their respective
Leases to Purchaser and the manner in which rent is to be paid
subsequent to Closing; and (B) evidence of termination of
Contracts designated by Purchaser, if applicable;
(x) a current Rent Roll certified by Seller as true,
correct and complete;
(xi) all letters of credit and other non-cash
security deposits for which Purchaser is not receiving a credit
under Section 14 below, together with appropriate documents of
assignment and amendment running in favor of Purchaser;
(xii) a certificate in the form of Exhibit "K"
executed by Seller recertifying the representations and
warranties set forth in Section 8(a) above as of the Closing
Date; and
(xiii) such other documents, instruments, consents or
agreements as may be reasonably requested by the Title Company
or the escrow agent, in order to issue the Title Policy, in the
form and with the endorsements required by this Agreement, and
to otherwise consummate the Closing.
(c) On the Closing Date, Purchaser shall deliver the
following to Seller, in form and substance reasonably acceptable to
Seller, all duly executed where appropriate, each of which shall be a
condition precedent to Seller's obligation to close the transaction
contemplated by this Agreement:
11
(i) executed counterparts of the real estate
transfer declarations described above;
(ii) counterparts of the Assignment and Assumption,
executed by Purchaser;
(iii) counterparts of the closing and proration
statement, executed by Purchaser;
(iv) a certified copy of the resolutions or consent
of Purchaser authorizing the transaction contemplated by this
Agreement or other satisfactory evidence of authorization;
(v) the Purchase Price, plus or minus prorations and
adjustments, and
(vi) such other documents, instruments or agreements
as may be reasonably requested by (A) Seller, in order to
consummate this Agreement or (B) Title Company or the escrow
agent, in order to issue the Title Policy free of any exceptions
raised due to the actions of Purchaser, and to otherwise
consummate the Closing.
(d) The Seller acknowledges that Purchaser intends to assign all of
its rights, title and interest in and to this Agreement. The assignee will be a
publicly registered company ("Registered Company") promoted by the Purchaser.
The Seller acknowledges that it has been advised that if the purchaser is a
Registered Company, the assignee is required to make certain filings with the
Securities and Exchange Commission (the "SEC Filings") that relate to the most
recent pre-acquisition fiscal year (the "Audited Year") for the Property. To
assist the assignee in preparing the SEC Filings, the Seller agrees to provide
the assignee with the following to the extent then not previously provided:
1. Access to bank statements for the Audited Year;
2. Access to the general ledger for the Audited Year;
3. Cash receipts schedule for each month in the Audited
Year;
4. Access to invoice for expenses and capital improvements
in the Audited Year;
5. Copies of all reasonably requested insurance
documentation for the Audited Year;
6. Copies of accounts receivable aging as of the end of the
Audited Year and an explanation for all accounts over 30
days past due as of the end of the Audited Year; and
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7. Signed representation letter from any outside auditor at
the end of the field work, if available.
The provisions of this section shall survive the Closing for a period of twelve
(12) months.
12. FIRE OR CASUALTY. In the event of damage to the Property by
fire or other casualty prior to the Closing Date, Seller shall promptly notify
Purchaser of such fire or other casualty. If the fire or other casualty causes
damage which would cost in excess of 5% of the Purchase Price to repair (as
determined by Seller in good faith), then Purchaser may elect, by written notice
to be delivered to Seller on or before the sooner of (i) the twentieth (20th)
day after Purchaser's receipt of such notice, or (ii) the Closing Date, to
either: (a) close the transaction contemplated by this Agreement and receive all
insurance claims and proceeds payable to Seller as a result of such fire or
other casualty, with the same being paid or assigned to Purchaser at Closing
(less any amounts applied to restoration plus the amount of any applicable
deductibles) or (b) terminate this Agreement, and receive a return of the
▇▇▇▇▇▇▇ Money in which case the parties hereto shall have no further obligations
hereunder (except for obligations which are expressly intended to survive the
termination of this Agreement). If the damage to the Property by fire or other
casualty prior to the Closing Date would cost less than or equal to 5% of the
Purchase Price to repair (as determined by Seller in good faith), Purchaser
shall not have the right to terminate its obligations under this Agreement by
reason thereof, and Seller shall have the right to elect to either repair and
restore the Property if such repair or restoration may be completed prior to the
Closing Date or to assign and transfer to Purchaser on the Closing Date all of
Seller's right, title and interest in and to all insurance proceeds paid or
payable to Seller on account of such fire or casualty together with a credit for
the amount of the applicable deductible. The provisions of this Section 12 shall
survive the termination of this Agreement.
13
13. CONDEMNATION. If, prior to the Closing Date, all or any
portion of the Property is taken by condemnation or a conveyance in lieu
thereof, or if notice of a condemnation proceeding with respect to the Property
is received by Seller (a copy of which notice shall be immediately delivered by
Seller to Purchaser), Seller shall promptly notify Purchaser of such
condemnation or a conveyance in lieu thereof. If the taking or threatened taking
involves a material portion of the Property (hereafter defined), Purchaser may
elect, by written notice to be delivered to Seller on or before the sooner of
(i) the twentieth (20th) day after Purchaser's receipt of such notice, or (ii)
the Closing Date, to terminate this Agreement, in which event the ▇▇▇▇▇▇▇ Money
shall be returned to Purchaser, and the parties hereto shall have no further
obligations hereunder (except for obligations which are expressly intended to
survive the termination of this Agreement). If Purchaser elects to close this
transaction notwithstanding such taking or condemnation, Purchaser shall be
entitled to any award given to Seller as a result of such condemnation
proceedings, with the same being paid or assigned to Purchaser at Closing. As
used herein, a "material portion of the Property" means any part of the Property
reasonably required for the operation of the Property in the manner operated on
the date hereof. If any taking or threatened taking does not involve a material
portion of the Property, Purchaser shall be required to proceed with the
Closing, in which event Seller shall assign to Purchaser any award given to
Seller as a result of such condemnation proceedings. The provisions of this
Section 13 shall survive the termination of this Agreement.
14. ADJUSTMENTS AND PRORATIONS. Adjustments and prorations with
respect to the Property shall be computed and determined between the parties as
of 12:0l a.m. on the Closing Date as follows:
(a) General real estate taxes for the year of closing and
special assessments (if any) shall be prorated as of the Closing
Date based on the then current real estate taxes (if known, based
on the final real estate tax bills for such period -- and if not
known, based on the most recent ascertainable taxes) and the
special assessments due and owing prior to Closing, and Seller or
Purchaser shall receive a credit at Closing, as appropriate.
Without affecting the obligations set forth in this Section 14(a),
the prorations for real and personal property taxes shall be
equitably pro rated on a "net" basis (i.e. adjusted for all
tenants' liabilities, if any, for such items). If general real
estate taxes or special assessments are not known as of the
Closing, the parties agree to reprorate when such amounts become
known. All obligations under this Section 14(a) shall survive the
Closing.
(b) All rents and other sums receivable from tenants of the
Property which were earned and attributable to the period prior to
the Closing Date will be retained by Seller to the extent that
such rents have been collected on or before the Closing Date.
Rents earned and attributable to the period beginning on the
Closing Date and thereafter will be paid to Purchaser by the
tenants, or credited to Purchaser at Closing (if such rents are
received by Seller prior to the Closing Date). All payments from
tenants, on account of rent or otherwise, received by Seller after
the Closing Date, whether attributable to the period prior to or
after the Closing Date, shall be deemed to be held in trust by
Seller for Purchaser and shall be promptly delivered to Purchaser
by Seller for application as provided in this Section 14(b). All
payments from tenants, on account of rent or otherwise, received
after the Closing Date by Purchaser and all amounts received from
14
Seller by Purchaser pursuant to the immediately preceding sentence, shall
be applied first to rent or other sums due under the Leases attributable to
the period beginning on the Closing Date and continuing thereafter, and
then to payment to Seller on account of rents which were earned and
attributable to the period prior to the Closing Date but which have not
been paid when due. Any customary out of pocket costs incurred by Purchaser
in collection of delinquent rentals shall be deducted by Purchaser prior to
the payment to Seller on account of delinquent rentals as provided herein.
Purchaser shall use commercially reasonable efforts to collect or attempt
to collect delinquent rentals. Seller shall have the right to contact
tenants to request payment of delinquent rentals after the Closing Date and
institute legal proceedings to collect such delinquent rentals. Any such
enforcement or collection efforts by Seller shall be at Seller's sole
expense.
(c) On the Closing Date, Seller will deliver to Purchaser in cash, as
a credit against the Purchase Price or as an adjustment to the prorations
provided for elsewhere in this Section 14, as appropriate, an amount equal
to all security deposits made by tenants occupying the Property which were
paid to Seller by such tenants and which have not been applied by Seller
pursuant to the Leases, together with interest owing thereon pursuant to
the applicable Lease, if any, and together with a listing of the tenants to
which such deposits and interest are owing.
(d) All amounts payable, owing or incurred in connection with the
Property under the Contracts to be assumed by Purchaser under the
Assignment and Assumption shall be prorated as of the Closing Date.
(e) Seller shall be entitled to a credit for all transferable utility
deposits transferred hereunder, if any. All other utility deposits, if any,
may be withdrawn by and refunded to Seller and Purchaser shall make its own
replacement deposits for utilities as may be required by the respective
utilities involved.
(f) The ▇▇▇▇▇▇▇ Money shall be paid to Seller at Closing and
Purchaser shall be entitled to a credit against the Purchase Price in the
amount thereof.
(g) All utility charges that are not separately metered to tenants
will be prorated to the Closing Date and Seller will obtain a final billing
therefor and pay any amounts owing therein for the period prior to the
Closing Date and Purchaser shall pay any amounts owing for the period on
and after the Closing Date. To the extent that utility bills cannot be
handled in the foregoing manner, they shall be prorated as of the Closing
Date based on the most recent bills available and reprorated when such
final bills become known.
(h) Purchaser shall pay its pro rata share (based on the applicable
commencement date of the lease and the lease term) of all leasing
commissions and tenant improvement costs payable with respect to Leases
entered into after the date of this Agreement. If Seller has paid such
amounts prior to the Closing Date, Purchaser shall reimburse Seller for its
pro rata share of such payments at Closing. If Seller has not paid such
amounts prior to the Closing Date, Purchaser shall receive a credit against
the Purchase Price at Closing in an amount equal to the Seller's pro rata
share of such amounts.
15
(i) Unless provided otherwise hereinabove, such other items
which are customarily prorated in a purchase and sale of the type
contemplated hereunder shall be prorated as of the Closing Date.
(j) Except as provided in this Section 14, all prorations are
final and there shall be no reprorations. Notwithstanding the foregoing,
each of the provisions of this Section 14 shall survive the Closing.
15. REQUIRED TENANTS. For purposes of this Agreement:
(a) An "Adverse Change" shall mean the happening of any one or
more of the following to a Required Tenant: (i) a Required Tenant has
failed to pay when due any rent or other charge due under such Lease and
such failure has continued for a period of sixty (60) days or more; (ii)
a Required Tenant is the subject of, or has received notice that it has
become the subject of, any reorganization, liquidation, dissolution,
receivership or other actions or proceedings under the United States
Bankruptcy Code, 11 U.S.C. (S)(S) 101, et seq. or any other federal,
state or local laws affecting the rights of debtors and/or creditors
generally; (iii) commencement by a Required Tenant of a voluntary case
or other proceeding seeking liquidation, reorganization or other relief
with respect to itself or its debts or other liabilities under any
bankruptcy, insolvency or other similar law or seeking the appointment
of a trustee, receiver, liquidator, custodian or other similar official
for it or any of its property; (iv) the Lease for a Required Tenant has
been terminated, or is the subject of an enforcement action for
termination, as a result of default by such tenant; (v) a Required
Tenant has terminated its Lease as a result of a fire or other casualty
or a pending or proposed condemnation (or has a right to terminate such
Lease and such right of termination has not been unconditionally and
irrevocably waived in writing by such tenant; provided, however, this
right of termination shall only apply to such tenant's initial right to
terminate its lease based upon the extent of the casualty, the estimated
time to complete the repair, or similar reasons but shall not apply to a
tenant's termination right based upon the non-timely completion of the
repair or restoration work), or (vi) a Required Tenant has ceased
operating its business in its leased premises in violation of its
obligations under the Lease.
(b) If at any time prior to the Closing Date there occurs an
Adverse Change with respect to a Required Tenant, then Purchaser shall
have the right, in its sole discretion, (i) to terminate this Agreement
and receive a full refund of the ▇▇▇▇▇▇▇ Money together with interest
accrued thereon or, in the alternative, (ii) to proceed to Closing in
accordance with this Agreement. If Purchaser elects to proceed to
Closing as aforesaid, then Purchaser shall not be entitled to a
reduction in or credit or allowance against the Purchase Price or give
rise to any other claim on the part of Purchaser. Purchaser shall notify
Seller of its election within fifteen (15) days after Seller has
notified Purchaser of an Adverse Change (and, in any event, at least
seven (7) days prior to the Closing Date).
16. CLOSING COSTS. Seller shall pay: (a) one-half of the aggregate
costs of the Title Commitment and the basic Title Policy without endorsements
(but including those endorsements required by the terms of this Agreement to be
obtained by Seller to clear
16
Unpermitted Exceptions), (b) the costs of recording any releases required to
clear title to the Property, (c) Seller's attorneys' fees and (d) one-half of
all escrow and New York Style closing fees. Purchaser shall pay: (i) the costs
of recording the deed and related stamp tax, sales tax, documentary transfer tax
or other tax imposed on the transfer of the Property, (ii) one-half of the
aggregate costs of the Title Commitment and the basic Title Policy without
endorsements, plus the costs of extended coverage and any endorsements to the
Title Policy desired by Purchaser or its lender, if any, (iii) the costs of the
Survey, (iv) Purchaser's attorneys' fees, and (v) one half of all escrow and New
York Style closing fees.
17. POSSESSION. Possession of the Property shall be delivered to Purchaser
at Closing, free and clear of all liens and claims other than Permitted
Exceptions and the rights of the tenants identified on the Rent Roll, in the
same condition as it exists on the date of this Agreement, ordinary wear and
tear excepted and except as provided in Sections 12 and 13 hereof. Purchaser
shall have the right to inspect the Property within three (3) days prior to
Closing to verify that the condition of the Property is as required under this
Agreement.
18. DEFAULT. If Seller defaults hereunder and fails to cure such default
within five (5) days after written notice of such default, or if the
representations and warranties set forth in this Agreement shall not be true and
correct in all material respects on the date of this Agreement and as of the
Closing Date, Purchaser's sole remedy shall be to either (a) terminate this
Agreement and receive a return of the ▇▇▇▇▇▇▇ Money (less $100 which shall be
paid to Seller in any event), in which event each of the parties hereto shall be
relieved of any further obligation to the other arising by virtue of this
Agreement (except for obligations which are expressly intended to survive the
termination of this Agreement), or (b) pursue specific performance of this
Agreement. In no event shall Seller be liable for any actual, special, punitive,
speculative or consequential damages; nor shall Seller's liability under any
representation, warranty, covenant, agreement, proration, reproration,
obligation or indemnity made hereunder or under any of the Closing Documents
exceed $100,000 in the aggregate ("Seller's Maximum Liability"). None of
Seller's partners, members, officers, agents or employees shall have any
personal liability of any kind or nature or by reason of any matter or thing
whatsoever under, in connection with, arising out of or in any way related to
this Agreement and the transactions contemplated herein, and Purchaser waives
for itself and for anyone who may claim by, through or under Purchaser any and
all rights to ▇▇▇ or recover on account of any such alleged personal liability.
If Purchaser defaults hereunder and fails to cure such default within five (5)
days of written notice of such default, this Agreement shall terminate and
Seller shall retain the ▇▇▇▇▇▇▇ Money and any interest thereon as liquidated
damages in full settlement of all claims against Purchaser (with the exception
of claims against Purchaser related to obligations which are expressly intended
to survive the termination of this Agreement). The parties agree that the amount
of actual damages which Seller would suffer as a result of Purchaser's default
would be extremely difficult to determine and have agreed, after specific
negotiation, that the amount of the ▇▇▇▇▇▇▇ Money is a reasonable estimate of
Seller's damages and is intended to constitute a fixed amount of liquidated
damages in lieu of other remedies available to Seller and is not intended to
constitute a penalty.
19. NOTICES. Any notice, demand, request or other communication which
either party hereto may be required or may desire to give under this Agreement
shall be in writing and shall be deemed to have been properly given if (a) hand
delivered (effective upon delivery),
17
(b) mailed (effective three (3) days after mailing) by United States registered
or certified mail, postage prepaid, return receipt requested, (c) sent by a
nationally recognized overnight delivery service (effective one (1) day after
delivery to such courier) or (d) sent by facsimile (effective upon confirmation
of transmission), in each case, addressed as follows:
IF TO SELLER:
c/o Transwestern Investment Company
▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telecopy Number: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
▇▇▇▇▇ & ▇▇▇▇▇▇ Limited
▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇
Telecopy Number: (▇▇▇) ▇▇▇-▇▇▇▇
IF TO PURCHASER:
In accordance with Line 11 of the Summary Statement
or to such other or additional addresses as either party might designate by
written notice to the other party.
20. BROKERS. Each of Seller and Purchaser represents and warrants to
the other that it has not dealt with any brokers, finders or agents with respect
to the transaction contemplated hereby other than the broker(s) set forth in
Line 12 of the Summary Statement (collectively, the "Brokers"). Each party
agrees to indemnify, defend and hold harmless the other party, its successors,
assigns and agents, from and against the payment of any commission,
compensation, loss, damages, costs, and expenses (including without limitation
attorneys' fees and costs) incurred in connection with, or arising out of,
claims for any broker's, agent's or finder's fees of any person claiming by or
through such party other than Brokers. The obligations of Seller and Purchaser
under this Section 20 shall survive the Closing and the termination of this
Agreement.
21. LEASING COSTS, MANAGEMENT FEES AND EMPLOYEES. Except as provided
in Section 14(h) hereof, Seller agrees to pay or discharge at or prior to
Closing all leasing commissions, costs for tenant improvements, legal fees and
other costs and expenses (collectively, "Leasing Costs") that are due and
payable as of the Closing Date with respect to Leases in force as of or prior to
Closing; provided, however, that Seller shall have no obligation to pay, and as
of Closing, Purchaser shall assume the obligation to pay (i) all Leasing Costs
disclosed on Exhibit H, and (ii) all Leasing Costs owed by Purchaser pursuant to
the terms of Section 14(h) above. On the Closing Date, Seller shall deliver
evidence satisfactory to Purchaser that, unless expressly assumed
18
by Purchaser in writing, any current management or leasing agreements for the
Property have been terminated (or notice of termination given), and that the
manager and any brokers have been paid all commissions or fees due and payable
except as provided in Sections 14(h) and 20 hereof. Purchaser is not required to
continue the employment of any employees of Seller or any property manager after
the Closing Date. Seller shall satisfy all obligations to all employees, if any,
employed by Seller or otherwise in the operation of the Property and provide
Purchaser with evidence thereof satisfactory to Purchaser on the Closing Date.
22. "AS IS" SALE.
(a) EXCEPT FOR THE EXPRESS REPRESENTATIONS AND WARRANTIES OF SELLER
SET FORTH HEREIN, PURCHASER ACKNOWLEDGES AND AGREES THAT IT WILL BE
PURCHASING THE PROPERTY BASED SOLELY UPON ITS INSPECTIONS AND
INVESTIGATIONS OF THE PROPERTY, AND THAT PURCHASER WILL BE PURCHASING THE
PROPERTY "AS IS" AND "WITH ALL FAULTS", BASED UPON THE CONDITION OF THE
PROPERTY AS OF THE DATE OF THIS AGREEMENT, ORDINARY WEAR AND TEAR AND LOSS
BY FIRE OR OTHER CASUALTY OR CONDEMNATION EXCEPTED AND THAT SELLER MAKES NO
WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, OR ARISING BY OPERATION OF
LAW, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTY OF CONDITION,
HABITABILITY, MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, IN
RESPECT OF THE PROPERTY. WITHOUT LIMITING THE FOREGOING, PURCHASER
ACKNOWLEDGES THAT, EXCEPT AS MAY OTHERWISE BE SPECIFICALLY SET FORTH
ELSEWHERE IN THIS AGREEMENT, NEITHER SELLER NOR ITS CONSULTANTS, BROKERS OR
AGENTS HAS MADE ANY REPRESENTATIONS OR WARRANTIES OF ANY KIND UPON WHICH
PURCHASER IS RELYING AS TO ANY MATTERS CONCERNING THE PROPERTY, INCLUDING,
BUT NOT LIMITED TO: (I) THE CONDITION OF THE LAND OR ANY IMPROVEMENTS
COMPRISING THE PROPERTY; (II) THE EXISTENCE OR NON-EXISTENCE OF ANY
POLLUTANT, TOXIC WASTE AND/OR ANY HAZARDOUS MATERIALS OR SUBSTANCES; (III)
ECONOMIC PROJECTIONS OR MARKET STUDIES CONCERNING THE PROPERTY, OR THE
INCOME TO BE DERIVED FROM THE PROPERTY; (IV) ANY DEVELOPMENT RIGHTS, TAXES,
BONDS, COVENANTS, CONDITIONS AND RESTRICTIONS AFFECTING THE PROPERTY; (V)
THE NATURE AND EXTENT OF ANY RIGHT OF WAY, LEASE, LIEN, ENCUMBRANCE,
LICENSE, RESERVATION OR OTHER TITLE MATTER; (VI) WATER OR WATER RIGHTS,
TOPOGRAPHY, GEOLOGY, DRAINAGE, SOIL OR SUBSOIL OF THE PROPERTY; (VII) THE
UTILITIES SERVING THE PROPERTY; (VIII) THE SUITABILITY OF THE PROPERTY FOR
ANY AND ALL ACTIVITIES AND USES WHICH PURCHASER MAY ELECT TO CONDUCT
THEREON; OR (IX) THE COMPLIANCE OF THE PROPERTY WITH ANY ZONING,
ENVIRONMENTAL, BUILDING OR OTHER LAWS, RULES OR REGULATIONS AFFECTING THE
PROPERTY. SELLER MAKES NO REPRESENTATION OR WARRANTY THAT THE PROPERTY
COMPLIES WITH THE AMERICANS WITH DISABILITIES ACT OR ANY FIRE CODE OR
BUILDING CODE. PURCHASER HEREBY RELEASES
19
SELLER FROM ANY AND ALL LIABILITY IN CONNECTION WITH ANY CLAIMS WHICH
PURCHASER MAY HAVE AGAINST SELLER AND PURCHASER HEREBY AGREES NOT TO ASSERT
ANY CLAIMS FOR CONTRIBUTION, COST RECOVERY OR OTHERWISE, AGAINST SELLER
RELATING DIRECTLY OR INDIRECTLY TO THE EXISTENCE OF ASBESTOS OR HAZARDOUS
MATERIALS OR SUBSTANCES ON, OR ENVIRONMENTAL CONDITIONS OF, THE PROPERTY,
WHETHER KNOWN OR UNKNOWN. As used herein, the terms "hazardous substances"
or "hazardous materials or substances" mean (i) hazardous wastes, hazardous
substances, hazardous constituents, toxic substances or related materials,
whether solids, liquids or gases, including but not limited to substances
defined as "hazardous wastes," hazardous substances," "toxic substances,"
"pollutants, "contaminants," "radioactive materials," or other similar
designations in, or otherwise subject to regulation under, the
Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended, 42 U.S.C. (S)9601 et seq.; the Toxic Substance Control
Act, 15 U.S.C. (S)2601 et seq.; the Hazardous Materials ▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇,
▇▇ ▇.▇.▇. (▇)▇▇▇▇; the Resource Conservation and ▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇ ▇.▇.▇.
(▇)▇▇▇▇. et seq.; the Clean ▇▇▇▇▇ ▇▇▇, ▇▇ ▇.▇.▇. (▇)▇▇▇▇; the Safe Drinking
Water Act, 42 U.S.C. (S)300f et seq.; the Clean Air Act, 42 U.S.C. (S)7401
et seq.; and in any permits, licenses, approvals, plans, rules, regulations
or ordinances adopted, or other criteria and guidelines promulgated
pursuant to the preceding laws or other similar federal, state or local
laws, regulations, rules or ordinance now or hereafter in effect relating
to environmental matters (collectively, "Environmental Laws"); and (ii) any
other substances, constituents or wastes subject to any applicable federal,
state or local law, regulation or ordinance, including any Environmental
Law, now or hereafter in effect, including but not limited to (A)
petroleum, (B) refined petroleum products, (C) waste oil, (D) waste
aviation or motor vehicle fuel and (E) asbestos. Purchaser acknowledges
that having been given the opportunity to inspect the Property, Purchaser
is relying solely on its own investigation of the Property and not on any
information provided or to be provided by Seller. Purchaser further
acknowledges that the information provided and to be provided with respect
to the Property was obtained from a variety of sources, and that Seller (x)
has not made any independent investigation or verification of such
information and (y) makes no representations as to the accuracy or
completeness of such information, except as provided herein. The provisions
of this Section 22 shall survive the Closing Date.
Purchaser's Initials ____________________
23. OFFER AND ACCEPTANCE.
Seller shall have three (3) business days to accept Purchaser's offer
measured from the date offered indicated below Purchaser's signature hereto.
Acceptance of the offer shall become effective only when Purchaser receives a
fully executed copy of this Agreement. If this Agreement has not been executed
by Seller and delivered to Purchaser prior to the end of the third (3rd)
business day after the date indicated below Purchaser's signature, the terms of
this Agreement shall be deemed null and void without further action.
24. MISCELLANEOUS.
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(a) Time is of the essence of each provision of this Agreement.
(b) This Agreement and all provisions hereof shall extend to, be obligatory
upon and inure to the benefit of the respective heirs, legatees, successors and
assigns of the parties hereto. Notwithstanding the foregoing, Purchaser shall
not have the right to assign its interest in this Agreement without the express
written consent of Seller; provided, however, if the assignment is to an entity
in which is managed or controlled by the initial Purchaser, Seller's consent
shall not be required provided Purchaser gives a copy of the duly executed
assignment (together with relevant information regarding Purchaser's affiliation
therewith) to Seller at least ten (10) days prior to the scheduled Closing Date;
and in any event, Purchaser shall remain liable for, and the assignee shall
assume, all obligations of Purchaser hereunder.
(c) Except as provided herein, this Agreement contains the entire agreement
and supercedes any prior discussions or writings (including any letters of
intent or other correspondence) between the parties relating to the transactions
contemplated hereby.
(d) This Agreement shall be governed by and construed in accordance with
the laws of the State described in Line 13 of the Summary Statement.
(e) If any of the provisions of this Agreement or the application thereof
to any persons or circumstances shall, to any extent, be deemed invalid or
unenforceable, the remainder of this Agreement and the application of such
provisions to persons or circumstances other than those as to whom or which it
is held invalid or unenforceable shall not be affected thereby.
(f) This Agreement and any document or instrument executed pursuant hereto
may be executed in any number of counterparts, each of which shall be deemed an
original, but all of which, together, shall constitute one and the same
instrument.
(g) From the date hereof through Closing, Purchaser and Seller shall
jointly prepare and issue all releases of information relating to the sale of
the Property, and any inquiries regarding the transaction contemplated hereby
shall be responded to only after consultation with the other party hereto.
(h) If either party institutes a legal action against the other relating to
this Agreement or any default hereunder, the unsuccessful party to such action
will reimburse the successful party for the reasonable expenses of prosecuting
or defending such action, including without limitation attorneys' fees and
disbursements and court costs. The obligations under this Section 24(h) shall
survive the termination of this Agreement.
(i) This Agreement shall not be construed more strictly against one party
than against the other merely by virtue of the fact that the Agreement may have
been prepared primarily by counsel for one of the parties, it being recognized
that both Purchaser and Seller have contributed substantially and materially to
the preparation of this Agreement.
(j) Intentionally Deleted
21
(k) The Summary Statement attached to this Agreement is hereby
incorporated herein and made a part hereof.
(l) If, under the terms of this Agreement and the calculation of the
time periods provided for herein, the Approval Date, the Closing Date or any
other date to be determined under this Agreement should fall on Saturday, a
Sunday, a legal holiday or other date on which banks located in Chicago,
Illinois are not open for business, then such date shall be extended to the next
business day.
(m) A facsimile or photocopy signature on this Agreement, any
amendment hereto or any notice delivered hereunder shall have the same legal
effect as an original signature.
(n) Prior to the Closing Date, the parties shall keep the terms of this
Agreement confidential and shall not disclose such terms to any other parties
without the other party's prior written consent, which consent shall be in each
party's sole discretion; provided, however, that each party may, without
obtaining such prior written consent, make such disclosures as may be required
by applicable laws or agreements by which such party is bound, and to each such
party's managers, members, officers, lenders, employees, attorneys,
accountants, appraisers, insurance advisors, consultants and similar third
party professionals.
[Signature Page Follows]
22
IN WITNESS WHEREOF, this Agreement has been executed as of the date
first above written.
PURCHASER: SELLER:
Triple Net Properties, LLC, Transwestern Heights, L.P., a Delaware
a Virginia limited liability limited partnership
company
By: Transwestern Heights GP, L.L.C., a
Delaware limited liability company
By:_____________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Its: President By: Aslan Realty Partners, L.P., an
Illinois limited partnership,
its sole member
Date Offered: July 24, 2002
By: Aslan GP, L.L.C. a Delaware
limited liability company, its
general partner
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------
Title: MANAGING DIRECTOR
------------------
Date Accepted: July 24,2002
23
IN WITNESS WHEREOF, this Agreement has been executed as of the date
first above written.
PURCHASER: SELLER:
Triple Net Properties, LLC, Transwestern Heights, L.P.,
a Virginia limited liability a Delaware limited partnership
company
By: Transwestern Heights GP, L.L.C.,
By:____________________________ a Delaware limited liability
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ company
Its: President
By: Aslan Realty Partners, L.P.,
an Illinois limited partnership,
its sole member
Date Offered: July 24, 2002
By: Aslan GP, L.L.C. a Delaware
limited liability company, its
general partner
By:__________________________
Name:________________________
Title: ______________________
Date Accepted: July 24, 2002
24
