Unofficial Translation] AGREEMENT made and entered into between the parties at Tel Aviv on the 3rd day of June 2010
Exhibit
4.44
[Unofficial
Translation]
made
and entered into between the parties at Tel Aviv
on
the 3rd day of
June 2010
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Between:
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TEL
AVIV MUNICIPALITY
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of __ Xxx
Xxxxxx Xxxxxx, Xxx Xxxx
(hereinafter: “the
Municipality”)
of the one
part;
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And:
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1. LEV
TEL AVIV TOWERS LTD.
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Pvte.
Co. 514434356
of
______________ Street, ______________
(hereinafter:
“the Housing
Company”)
2. TEL
AVIV CITY MALL LTD.
Pvte.
Co. 514434349
of
______________ Street, ______________
(hereinafter:
“the Mall
Company”)
of the other
part;
(the
Housing Company and the Mall Company will be referred to below as: “the
Purchaser”)
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WHEREAS
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The
Municipality is the registered owner of land known as Parcels 92, 93, 94,
95, 98, 99, 114 and 242 Block 7104 which is also known as the (former)
wholesale market compound, in the triangle formed by Carlebach and
Hahashmonaim Streets and Menahem Begin Road in Tel Aviv (hereinafter:
“the Project
Lands”); extracts of registration in respect the Project Lands is
attached to this Agreement as Appendix
E; and
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WHEREAS
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In
connection with the Project Lands, the Municipality and Tel Aviv Wholesale
Agricultural Produce Market Company Ltd. (hereinafter: “the Company”) have
entered into: (1) an agreement dated January 29, 2002 (hereinafter: “the 2002 Agreement”),
(2) an Addendum to the 2002 Agreement dated June 1, 2008 (hereinafter:
“the Addendum to the 2002
Agreement”), (3) an agreement dated April 15, 2010 (hereinafter:
“the 2010
Agreement”);
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The 2002
Agreement, the Addendum to the 2002 Agreement and the 2010 Agreement are
attached to this Agreement as Appendix
C; and
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WHEREAS
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On
September 29, 2005 Detailed Plan No. TA 3001 (hereinafter: “the TA/3001 Plan”) was
published for validation, and in addition an architectural design plan was
approved in respect of the Project Lands (hereinafter: “the Architectural Design
Plan”);
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The
TA/3001 and the Architectural Design Plan are attached to this Agreement as
Appendix
D; and
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WHEREAS
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As
at the date of signing of this Agreement the Company is registered as
leasehold lessee of the land known as Parcel 93 Block 7104 for a leasehold
period terminating in 2025 (hereinafter: “the Existing
Leasehold”), while pursuant to the 2002 Agreement and the
allocation table attached to TA/3001 Plan, the Company is entitled, in
lieu of the existing leasehold, to be registered as the long leasehold
lessee of the Company’s
lands, as defined below, for a leasehold period terminating on
August 31, 2099, together with additional land that constitutes portion of
the remainder of the Project Lands, as defined below. A caveat is registered in
favor of the Company in respect of the 2002 Agreement over Parcel 93 as
described in the extract of registration;
and
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WHEREAS
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In
accordance with the foregoing, the Company is entitled to be registered as
the owner of the full long leasehold rights in certain areas marked in
pink on the leasehold drawings which are attached to this Agreement as
A1
– A7 (hereinafter: “the Leasehold
Drawings”), and as owner of the full long leasehold rights in
13,200/19,000 undefined parts of the areas marked in yellow and by a
broken yellow line on the Leasehold Drawings (hereinbefore and
hereinafter, collectively: “the Company’s Lands”);
and
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WHEREAS
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The
Municipality is the owner of the full rights in the certain areas that are
marked in light blue on the Leasehold Drawings (Appendix A) and is the
owner of the full rights in 5,800/19,000 undefined parts of the areas that
are marked in yellow and in a broken yellow line on the leasehold drawings
(hereinafter collectively: “the Municipality
Lands”); and
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WHEREAS
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The
Municipality is the owner of the full rights in Plot No. 8 (as defined
below) and the Municipality wishes to let under leasehold certain portions
within the confines of Xxxx Xx. 0 to the Purchaser (over and above the
rights of leasehold in the Municipality Lands), as marked in light blue on
the drawings attached to this Agreement as Appendices B1-B6 and which
constitute the Additional Real Estate Rights as defined below, all as more
fully described below in this Agreement;
and
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WHEREAS
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In
addition to the Company’s Lands, the Municipality Lands, and the
Additional Real Estate Rights, the Company and the Municipality own the
rights in adjacent land which constitutes the remainder of the Project
Lands and which are not being sold to the Purchaser within the framework
of this Agreement (hereinafter: “the Remainder of the Project
Lands” or “the
Remainder of the Project”) and are marked in purple on the
Leasehold Drawing; and
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WHEREAS
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The
structure and the percentage holdings in the Housing Company and in the
Mall Company are as described in the chart attached to this Agreement as
Appendix G, with the shareholders (directly or residually) in the Housing
Company and in the Mall Company being: Blue Square Real Estate Ltd. (50%),
Dirot Yukra Ltd. (25%) and Xxxxx Investments 1 Ltd.
(25%);
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Blue
Square Real Estate Ltd., Dirot Yukra Ltd. and Xxxxx Investments 1 Ltd. will
henceforth be referred to collectively as – “the Interested Parties”;
and
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WHEREAS
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Simultaneous
with the Purchaser signing this Agreement the Interested Parties are
signing the Interested Parties’ undertakings as set forth at the foot of
this Agreement (hereinafter: “the Interested Parties’
Undertakings”); and
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WHEREAS
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The
Purchaser (as described in sub-clause 5.2.2 below) wishes to purchase
the Property Sold
(as defined below) from the Municipality in its condition “as is”, after
having carried out all the examinations required by it, independently and
without relying on any representation or any item of data given to it by
the Municipality and/or the Company and/or entities connected with either
of them and/or acting on behalf of either of them;
and
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2
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WHEREAS
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For
purposes of constructing “the public buildings” (as defined below), the
Purchaser was required in the scope of the sale process to assess the
total costs for erecting the public buildings, in circumstances where the
Municipality and the Company had two alternatives available to them in
this regard: one was to deduct the aforesaid amount from the consideration
in respect of the Property Sold (as defined in this Agreement) and the
other was that the public buildings be constructed through or by the
Purchaser for a consideration that will be paid to it by the Municipality
and the Company, and the Municipality and the Company chose the second
alternative, as described in this Agreement;
and
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WHEREAS
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In
accordance therewith and according to the provisions of this Agreement
below, the Housing Company is committed to erect the public buildings (as
defined below) and to deliver same to the Municipality as described in the
construction contract and the appendices thereto, which is attached to
this Agreement as Appendix 7.1.1 and as Appendix 4.13 to the Company’s
Lands Agreement” (as defined below) for a consideration that will be paid
to it by the Municipality and by the Company, as described below in this
Agreement and in the Company’s Lands Agreement;
and
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WHEREAS
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The
Municipality, in reliance on the Purchaser’s representatives as set forth
in this Agreement, wishes to accept the Purchaser’s offer to purchase the
Property Sold;
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WHEREAS
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Prior
to the date of signing of this Agreement, the individual parties who make
up the Purchaser delivered to the Municipality firm commitment letters
from Bank Hapoalim B.M. in connection with their commitment for payment of
the full “basic
consideration” (as defined below) in accordance with this Agreement
(excluding the first payment, the additional first payment and the later
first payment), with this being in the text attached to this Agreement as
Appendix
F.
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Now therefore it is
stipulated, declared and agreed by the parties as follows:
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1.
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Definitions:
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1.1
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“The Agreement” or “this
Agreement”
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–
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This
Agreement together with all the appendices hereto.
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1.2
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“The
sale process”
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–
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A
sale process conducted in accordance with the sale procedure as defined
below.
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1.3
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“The
sale procedure”
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–
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A
sale procedure that was published by the Company and the Municipality and
pursuant to which the sale process was conducted.
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1.4
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“The
sale process guarantee”
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–
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Bank
guarantees in an aggregate amount of NIS 9,183,216 which were deposited
with the Municipality in the scope of the sale process.
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1.5
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“Business
day”
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A
day on which most of the branches of the banks in Israel are open for
transactions with the public and in relation to which the clearing of
instruments is carried out.
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1.6
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“The
Property Sold”
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–
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(a) The
rights and obligations of the long leasehold in the Municipality Lands for
a lease period ending on August 31, 2099, all in accordance with the
conditions set forth in this Agreement and in the special conditions of
leasehold document which is attached to this Agreement as Appendix
1.6.
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3
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The
Municipality Lands have building rights of
9,240 sq.m. (main areas) for residential purposes and 5,800 sq.m. (main
areas) for commercial purposes for the designated uses specified in Plan
TA/3001 and together with service areas in accordance with Plan TA/3001,
and the Company and the Municipality agree that the total service areas
for housing in the urban-texture building on Plot No. 1 above the
determining entrance level as stated in Plan TA/3001 which will be
included in the applications for building permits that will be lodged by
the Purchaser in the scope of the Purchaser’s Project, will aggregate a
total of at least 22,924 sq.m. service areas but not more than the maximum
permitted in accordance with Plan TA/3001.
For
the removal of doubt it is clarified that the total main areas which are
being sold to the Purchaser in accordance with this Agreement are as
stated at the beginning of this sub-clause 1.6(a).
Without
derogating from the foregoing in this sub-clause 1.6, it is agreed that if
changes in the agreement of the parties on the boundaries of the
Municipality Lands should be necessary and be approved as a consequence of
detailed planning of the Municipality Lands or of the Project Lands, the
Leasehold Drawings will be amended accordingly, without any change
applying to the building rights being sold to the Purchaser in the scope
of the Property Sold.
Under
no circumstances, does the Property Sold include and will not include the
parking places towers in the Kufsa lands, as defined below.
(b)
Rights and obligations of the long leasehold of the lands which form part
of Xxxx Xx. 0 and which are marked in light blue on the drawings that are
attached as Appendix B1 to B6 to this Agreement, excluding the land of 40
parking places that will be delivered to the Municipality as stated in
sub-clause 7.2.4 below (hereinafter: “the Additional
Real Estate Rights”) for a leasehold period ending on August 31,
2099, all in accordance with the terms and conditions set forth in this
Agreement and in the special conditions document for the leasehold which
is attached to this Agreement as Appendix
1.6, where the rights of leasehold in the Additional Real Estate
Rights lands make it possible to exploit building rights as
follows:
(1) Building
rights for the construction of 4,500 sq.m. main areas (in addition to
service areas in accordance with the provisions of Plan TA/3001), for the
uses and zonings as described in Paragraph 9.4 of the Plan TA/3001
(hereinafter: “the Ancillary
Commercial Areas”).
(2) Building
rights for the construction of 215 specific and permanent built parking
places on the fourth basement floor (-4) and building rights for the
construction of additional parking floors on the fifth basement
floor (-5) as stated in sub-clause 7.2.4 below (hereinafter: “the Additional Parking
Areas”). The Additional Parking Areas will serve as a public
parking garage in accordance with Paragraph 9.4.1 of Plan TA/3001 and
subject to the contents of Clause 7.2
below.
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4
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(c) “The
obligations and the commitments transferred” as defined in Clause
1.7 below.
(d)
For the removal of doubt it is clarified that the remaining areas on Xxxx
Xx. 0, apart from the Additional Real Estate Rights, and the areas that
are located on the upper ground floor and on the lower ground floor only
and which are zoned for an open public area and a road as marked in green
and in grey (respectively) on the Leasehold Drawings, Appendices
A1-A2, are in the sole possession and sole ownership of the
Municipality, are not leased under leasehold and will remain in the
Municipality’s exclusive possession and use, all in accordance with what
is described in sub-paragraph 9.6 of Plan TA/3001, and the Purchaser has
no rights therein and in the areas intended for “Suburban Public
Institutions” as mentioned in sub-clauses 7.1.1.2 and 9.8.2
below.
To the extent that the Municipality and the
Company exercise their power pursuant to Paragraph 3.5 of Appendix 4.14 to
this Agreement, in a manner whereby the parking places that will serve the
residential units that will be built on the Remainder of the Project Lands
and will be linked thereto, which will be located in the Kufsa
(hereinafter: “the Towers
Parking Places in the Kufsa”), the land which is the subject of the
Towers Parking Places in the Kufsa and
which will be located in each of the parking places in the Kufsa, apart
from places at which parking places will be erected for the commercial
areas in the Kufsa (hereinafter: “the Towers
Parking Places in the Kufsa Lands”) do not constitute part of the
Property Sold and the Leasehold Drawings will be amended
accordingly. For the removal of doubt it is clarified that in
this Agreement the Municipality is not selling or granting any rights to
the Purchaser in the Towers Parking Places in the Kufsa Lands except the
right of use specified in Paragraph to this
Agreement.
It
is agreed that the exercise of its right by the Municipality as aforesaid
shall not derogate from the Purchaser’s possibility of: (1) erecting the
maximum number of parking places which are permitted pursuant to Plan
TA/3001 for the building rights on the Company’s Lands and the
Municipality Lands (including parking places for visitors on the Project
Lands) and (2) for erecting the maximum service areas that are permitted
pursuant to Plan TA/3001 in the building rights on the Company’s Lands and
the Municipality Lands. It was further agreed that the
Municipality and the Company will direct their professional advisors to
endeavor and to see to it that all the parking places will be designated
to serve the residential units in the Remainder of Project Lands without
the need for exercising the power granted to the Municipality and to the
Company pursuant to Paragraph 3.1 of Appendix 4.14, and this without
derogating from the Municipality’s and the Company’s possibility of (1)
erecting the maximum number of parking places in the Remainder of the
Project Lands which are permitted pursuant to Plan TA/3001 for the
building rights on the Remainder of the Project Lands (without double
parking places) and (2) for erecting the maximum service areas that are
permitted pursuant to Plan TA/3001 in the building rights on the Remainder
of the Project Lands and (3) erecting parking basements on 5 levels
only.
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5
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1.7
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“The
Obligations and Commitments Transferred”
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–
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The
obligations and commitments transferred which are described below, unless
otherwise expressly excluded in this Agreement below:
(a)
Rights and obligations that apply to the Municipality according to any law
in its capacity as the owner of rights in the Municipality Lands (as
distinguished from its status as owner or as a local
authority).
(b)
All the obligations imposed on an applicant for any permit in accordance
with Plan TA/3001 and the Architectural Design Plan, including the
appendices thereto, in relation to the Municipality Lands and to the
Additional Real Estate Rights, with it being clarified that nothing in the
foregoing shall derogate from the Purchaser’s possibility of requesting an
amendment to Plan TA/3001 and/or the Architectural Design Plan, from time
to time, in accordance with any law and the terms and conditions of this
Agreement, and subject to the conditions of Appendix 4.14 to this
Agreement.
(c)
The rights and obligations of the Municipality pursuant to the 2002
Agreement in relation to the Municipality Lands and the Additional Real
Estate Rights, except rights and obligations of the Municipality arising
from its status as leasehold lessor or as a local authority.
It
is further clarified for the removal of doubt that the Municipality is not
assigning its rights and obligations under the Addendum to the 2002
Agreement and under the 2010 Agreement to the Purchaser, including and
without derogating from the foregoing, the Municipality’s rights and
obligations to receive money from the Company and for the payment of money
to the Company in the scope of the accounting referred to in Clause 8.2 of
the Addendum to the 2002 Agreement, which, as already mentioned, are not
being assigned to the
Purchaser.
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6
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(d)
For the removal of doubt it is clarified that the Obligations and
Commitments Transferred include only obligations and commitments in
relation to the Municipality Lands and the Additional Real Estate Rights,
as distinct from the Remainder of the Project Lands. If the
Obligations and Commitments Transferred as described in sub-clause 1.7
above are in the nature of being obligations or commitments in relation to
all the Municipality’s rights and obligations in the Project Lands, then
the Purchaser will be entitled to and liable for such obligations and
commitments according to its pro rata share, which
is the ratio between the building rights (main areas) in the Municipality
Lands and the Additional Real Estate Rights and total building rights
(main areas) of the Municipality in the Project Lands. It is
further clarified that in relation to obligations forming part of the
Obligations and Commitments Transferred with respect to which a time was
specified in the relevant agreement for the performance thereof, the
assignment of such obligations and commitments will apply only to
obligations the time for performance of which is after the date of delivery of the right of use (as
defined below), unless otherwise stated in this
Agreement.
(e) Notwithstanding the foregoing it
is agreed and clarified that the legal proceedings mentioned in Appendix
3.1 to this Agreement are brought to the knowledge of the Purchaser for
information only and that the liabilities that are the subject matter of
the aforesaid legal proceedings, to the extent that same should apply, are
not being transferred and assigned to the Purchaser in the scope of this
Agreement and are not included in the Obligations and Commitments
Transferred, as defined above.
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1.8
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“The
local committee”
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The
Tel Aviv-Jaffa Local Planning and Building Committee.
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1.9
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“Plan
TA/3001”
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–
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Detailed
Plan No. TA/3001 which was published for validation on September 29, 2005
in Yalkut
Pirsumim (Gazette) No. 5442, together with the appendices
thereto.
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1.10
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“Plot
No. 8”
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–
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Plot
No. 8 as defined in Plan TA/3001
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1.11
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“Plot
No. 1”
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–
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Plot
No. 1 as defined in Plan TA/3001
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1.12
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“Plot
No. 6”
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–
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Plot
No. 6 as defined in Plan TA/3001
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1.13
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“Date
of delivery of right of use”
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–
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As
defined in Clause 10 of the Agreement.
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1.14
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“The
Municipality’s attorney” or “the Trustee”
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–
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The
legal adviser of the Municipality or another attorney who may be appointed
by him.
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1.15
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“The
consideration”
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–
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The
basic consideration together with the additional consideration as these
terms are defined in Clause 6 below.
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1.16
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“Date
of delivery of possession”
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–
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As
defined in Clause 10 below.
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1.17
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“Related
entities”
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–
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The
controlling shareholder in any chain and/or shareholders and/or holders of
rights of any sort and/or employees and/or representatives and/or agents
and/or attorneys and/or officers and/or professional
advisers.
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7
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1.18
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“Consumer Price Index”
or “the
Index”
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–
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Unless
otherwise expressly stated in a particular clause of the Agreement, the
Consumer Price Index, including fruit and vegetables, published by the
Central Bureau of Statistics and Economic Research, including that index
even if it is published by another Government body or institution and any
official index which may come in its stead, whether or not same is
structured on the same data on which the existing index is
structured. If the Consumer Price Index is replaced by another
index, the ratio between the replaced index and the other index will be
determined by the Central Bureau of Statistics.
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1.19
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“The
Basic Index”
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–
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Unless
otherwise expressly stated in a particular clause of this Agreement, the
index which is known at the time of signing of this
Agreement.
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1.20
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“Indexation
differences”
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–
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Unless
otherwise expressly stated in a particular clause of this Agreement, an
increment in payment obtained from multiplying any payment, which
accumulates indexation differences according to the provisions of this
Agreement, by the percentage rise in the last known index at the time of
making such calculation and/or payment, as against the Basic
Index. For the removal of doubt, in a case of a fall in the new
index as against the Basic Index, there will be no deduction from the
payment.
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1.21
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“The
Kufsa”
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–
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The
land marked in red on the drawing attached to this Agreement as Appendix
1.23 (including all the levels thereof).
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1.22
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“The
Purchaser’s Project”
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–
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The
project which the Purchaser will erect on the Company’s Lands, the
Municipality Lands and the Additional Real Estate
Rights.
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1.23
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“The
residential section”
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–
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Residential
buildings that will be erected on the Purchaser’s Project (excluding the
basement floors) and excluding the commercial areas that will be located
in the aforesaid residential buildings.
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1.24
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“The
basement floors”
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–
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All
the basement floors in the Purchaser’s Project up to and including the
upper ground floor on which the open public areas (as defined in
sub-clause 7.3 below) will be constructed, as well as all the commercial
areas in the Purchaser’s Project whether same are located on the basement
floors or are located above the basement floors.
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1.25
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“Buyers
of apartments”
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–
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Buyers
of apartments in the residential section.
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1.26
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“Building
Inputs Index”
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–
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The
general index of residential building input prices which is published each
month by the Central Bureau of Statistics or any other body that may come
in its stead, or any other index that may be specifically published in its
place (subject to the ratio between them that will be
fixed).
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1.27
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“The
Company’s Lands Agreement”
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–
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An
agreement between the Purchaser and the Company for the acquisition of the
leasehold rights in the Company’s Lands, which is being signed by the
Purchaser and the Company simultaneously with the signing of this
Agreement.
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8
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1.28
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“The
Project”
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–
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The
project that will be erected on Project Lands and which will contain both
the Purchaser’s Project as defined below as well as the project/s that
will be constructed on the Remainder of the Project
Lands.
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1.29
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“Agreement
of individual parties who make up the Purchaser”
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–
|
Agreements,
wherever signed prior to the signing of this Agreement or subsequent
hereto, which are signed by the individual parties who make up the
Purchaser and/or between the Interested Parties in connection with the
transaction that is the subject of this Agreement and/or in connection
with the Purchaser’s
Project.
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2.
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Appendices:
|
This
Agreement contains the following appendices which form an integral part
hereof:
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Appendices A1-A7
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–
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Drawings
of the Company’s Lands and the Municipality Lands.
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Appendices B1-B6
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–
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Drawings
of the Additional Real Estate Rights.
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Appendix C
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–
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The
2002 Agreement, the Addendum to the 2002 Agreement (dated June 1, 2008)
and the 2010 Agreement.
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Appendix D
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–
|
Plan
TA/3001 and the Architectural Design Plan (including the appendices
thereto).
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Appendix E
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–
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Extracts
of registration of the Project Lands.
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Appendix F
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–
|
Firm
commitment letter.
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Appendix G
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–
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Structure
and percentage holdings in the Housing Company and in the Mall
Company.
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Appendix 1.6
|
–
|
The
special conditions of leasehold document.
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Appendix 1.21
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–
|
Drawing
of the Kufsa.
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Appendix 3.1
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–
|
Legal
proceedings in connection with the Property Sold to which the Municipality
is a party.
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Appendix 3.2
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–
|
Approval
of the City Council and the approval of the Minister of the Interior
referred to in Clause 3.2 below.
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Appendix 4.13
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–
|
Declaration
of verifying representations drawn to the date of delivery of the right of
use and the right of possession.
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Appendix 4.14
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–
|
Additional
provisions appendix.
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Appendix 4.16
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–
|
Timetables
appendix.
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Appendix 6.2.7
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–
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Letter
of instructions to Trustee.
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Appendix 6.9.1
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–
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Main
points of the specification, simulations and
photographs.
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Appendix 7.1.1
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–
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The
Construction Contract and all the appendices thereto.
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Appendix 9.1.5
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–
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Tax
certificates in respect of the 2002 Agreement.
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Appendix 9.5
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–
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Text
of power of attorney to the Company’s attorneys for expunging of caveat.
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9
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Appendix 9.5A
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–
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Power
of attorney in favor of the Municipality for specifically attributing a
caveat and for
the effecting of registrations.
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Appendix 9.9
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–
|
Power
of attorney in favor of the Municipality for effecting
registrations.
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Appendix 10.3.3
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–
|
Notarial
power of attorney for eviction of the Purchaser.
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Appendix 10.4.2
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–
|
Text
of deed of assignment of the Obligations and Commitments
Transferred.
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3.
|
Declarations by the
Municipality
|
The
Municipality hereby declares and undertakes as follows:
|
3.1
|
That
it owns the rights in the Municipality Lands and in the Additional Real
Estate Rights as same are described in this Agreement and its aforesaid
rights in the Municipality Lands and in the Additional Real Estate Rights
are free and clear of any debt, encumbrance, attachment, mortgage and
third party rights, apart from a caveat regarding an
antiquities site in favor of the State of Israel which is registered over
the Project Lands pursuant to Deed No. 44510 dated December 1, 1995, where
in relation to the Municipality’s rights in the Additional Real Estate
Rights it is clarified that leaseholds which have expired are registered
in the Land Registry over Parcel 92 Block 7104. The said
registration situations does not derogate from the rights conferred on the
Purchaser under this Agreement, and the Municipality undertakes to act
with due diligence, including by way of taking legal proceedings, in order
to expunge these leaseholds from registration in the Land Registry.
Included in this, the Municipality undertakes to act in order to expunge
the leaseholds that have expired in a manner that this will be completed
not later than the date of payment of the second payment, with it being
clarified that the failure to expunge all the leaseholds that have expired
up to the aforesaid time will not be deemed to be a breach of this
Agreement, without this derogating from the Municipality’s obligations
pursuant to sub-clause 16.6.3.1 below in relation to registration of an
encumbrance over Parcel 92 Block 7104. It is further clarified
that the Municipality is a party to the legal proceedings described in
Appendix
3.1 to this Agreement.
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3.2
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That
it has through its authorized organs approved the format pursuant to which
the contractual arrangement with the Purchaser is being made, including
the fact that the City Council has approved the sale that is the subject
of this Agreement on an exemption from tender, in the scope of the sale
process. On February 20, 2008, the Municipality also received
approval of the Minister of the Interior for an exemption from the holding
of the tender in respect of the sale that is the subject of this Agreement
and the approval in principle of the Minister of the Interior to the
leasing under leasehold of the Municipality Lands and the Additional Real
Estate Rights in the scope of the sale process, in accordance with the
Municipalities Ordinance [New Version] (hereinafter: “the
Ordinance”).
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Subject
to the fulfilment of the condition precedent as set forth in Clause 12 below,
the Municipality is entitled and empowered to enter into this Agreement and to
perform this Agreement, in circumstances when its entering into this Agreement
and performing of its obligations pursuant hereto do not require further
decisions and/or approvals.
The
approval of the City Council and the approval of the Minister of the Interior,
which were received as aforesaid, are attached to this Agreement as Appendix
3.2.
10
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4.
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Declarations by the
Purchaser
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The
Purchaser hereby declares and undertakes as follows:
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4.1
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That
each of the individual parties who make up the Purchaser is duly
incorporated and that each of the individual parties who make up the
Purchaser is entitled and empowered to enter into this Agreement and to
perform it, and that it has passed all the resolutions and obtained the
approvals required according to the provisions of the law and its
documents of incorporation for purposes of its entering into this
Agreement.
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4.2
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That
no steps have been taken for an arrangement, stay of proceedings,
winding-up, liquidation, expungement, bankruptcy or receivership of any of
the individual parties who make up the Purchaser, and that there is no
threat against any of the individual parties who make up the Purchaser
with regard to such legal proceedings (including the fact that no
attachment has been imposed on their assets), which is likely to have an
impact on their entering into this Agreement and on the performance and
implementation of this
Agreement.
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4.3
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That
it is bound by the declarations, representations and undertakings that
were given on its behalf in the scope of the Sale Process and the Sale
Procedure, and that its declarations and undertakings mentioned in this
sub-clause above are correct, complete, full and updated, and are binding
on it in all respects.
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4.4
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That
acquisition of the Property Sold is being effected for the Purchaser
alone, and it or any of the individual parties who make up the Purchaser
is not acting, and will not act as an agent, representative, trustee
and/or partner in this regard, with and/or for another, whether directly
or indirectly, including the fact that they have not granted a right or
option to another as aforesaid in connection with the Property Sold and/or
the rights contained herein, prior to signing of this
Agreement.
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4.5
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That
it is aware that the Municipality has agreed to enter into this Agreement
with it inter
alia in reliance on the contents of the Firm Commitment Letter,
Appendix F to this Agreement, and that coupled with that the furnishing of
the aforesaid commitment letter does not derogate from the Purchaser’s
obligation to pay the full consideration at the times specified for the
payment thereof in Clause 6 below, with it being clarified that the
Purchaser’s obligation for full payment of the consideration in accordance
with the provisions of this Agreement is absolute and is not contingent
upon receiving finance or on any other
condition.
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4.6
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That
the Purchaser is buying the Property Sold in the same condition in which
the Property Sold is at the time of signing of this Agreement (“as is,
where is”) and after the Purchaser had examined, inspected and
seen:
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(i)
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The
Project Lands (including the Municipality Lands, the Additional Real
Estate Rights and the Company’s Lands), and the surrounding neighborhood
thereof, their physical and legal condition (including the registration in
the Land Registry of Parcel 242 Block 7104 as “designated lands” and the
planning and zoning situation of the Project Lands (including the
Municipality Lands, the Additional Real Estate Rights and the Company’s
Lands), adjacent land, and the region in which the Project Lands
(including the Municipality Lands, the Additional Real Estate Rights and
the Company’s Lands) are
located;
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11
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(ii)
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The
Obligations and Commitments Transferred, as defined in sub-clause 1.7
above.
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(iii)
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Plans
of any sort pursuant to the Planning and Building Law and on the strength
of any other statute or law, whether approved or in preparation, at any
level and at any planning or other authority or institution, which pertain
to the Project Lands (including the Municipality Lands, the Company’s
Lands and the Additional Real Estate Rights) and all land in the
surrounding area thereof, and included in this they have inspected,
examined and seen the provisions of Plan TA/3001 including all the
appendices thereto and the Architectural Design Plan and all the
appendices thereto, and are familiar
therewith;
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(iv)
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The
ways of access, the possibilities for planning, exploitation, licensing
and building of the Project Lands (including the Municipality Lands, the
Additional Real Estate Rights and the Company’s Lands) and all land in the
surrounding area thereof;
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(v)
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The
quality and composition of the Property Sold, including with regard to
matters connected with the environment, antiquities, marketability,
design, quality and so forth, and the suitability of any of the
abovementioned matters for the Purchaser’s
needs;
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(vi)
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Any
relevant information of whatsoever nature at all the relevant authorities,
including the Land Registry, the Taxes Authority, the various planning and
building authorities and the relevant local
authorities;
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(vii)
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The
provisions of all the statutes, laws, bylaws which relate to the Property
Sold and/or to the Purchaser’s entering into this
Agreement.
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The
Purchaser
hereby confirms, declares and undertakes that it has found all the foregoing to
be to its full satisfaction, and that it hereby finally and irrevocably waives
any cause of action and/or demand and/or allegation and/or claim of whatsoever
nature in connection with the matters aforesaid, including an allegation of
non-conformity (patent or latent) and including allegations regarding defects in
the contractual arrangement such as an error, as against the Municipality and/or
the Company and/or as against the entities connected with any of the individual
parties who make it up and/or anyone on its behalf, whether the origin of a
cause of action in connection with the foregoing was in a period preceding the
Date of Delivery of Possession or subsequent thereto. Included in
this the Purchaser waives any right to receive any remedy of cancellation,
damages or restitution in respect of allegations or causes of action as
aforesaid.
It
is
clarified that nothing contained in this sub-clause 4.6 shall derogate from the
Purchaser’s possibility of requesting an amendment of the Architectural Design
Plan, in accordance with and subject to the provisions of this Agreement,
including the provisions of Appendix 4.14 to this
Agreement.
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4.7
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That
it has the experience, know-how and ability to assess its entering into
this Agreement and the significances thereof, and that having regard
thereto, as also having regard to everything stated above and below in
this Agreement, it has carried out its aforesaid examinations in
consultation with all the experts whom it saw fit, in the course of
defining the information it wishes to
examine.
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12
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4.8
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That
the Purchaser is purchasing the rights in the Property Sold on the
strength of its own independent examinations, assessments and forecasts as
aforesaid only, and it has not relied for purposes of entering into this
Agreement on any promises, representations, undertakings or guarantees
from the Municipality and/or the Company and/or from any of the bodies
connected with either of them, except those that are expressly mentioned
in this Agreement and in the Company’s Lands Agreement, and without this
imposing on the Company and/or the Municipality and/or any of the bodies
connected with either of them, any liability of whatsoever nature with
regard to the Property Sold or to the value thereof, and without this
imposing any obligation for indemnity on the Company and/or the
Municipality and/or any of the bodies connected with either of
them.
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The
Purchaser declares that if it has not examined any detail connected with the
Property Sold independently, itself and/or through any entity on its behalf,
including any of the details mentioned in sub-clause 4.6 above and/or in
connection with any other details contained in this Agreement or arising from
it, for any reason, including by virtue of the difficulty of accessibility to
the information and/or due to restrictions that have been imposed, if and to the
extent that same were imposed, for any reason, on any such information or data
whatsoever at any particular authority or at any source of information, this
factor has been taken into account in the scope of the consideration pursuant to
this Agreement, and it waives any allegation or argument in connection
therewith.
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4.9
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That
acquisition of the Property Sold is in furtherance of a request for
proposals and a sale process that was conducted by the Municipality and
the Company in accordance with the sale procedure and following the
Purchaser’s selection as a preferred bidder. The Purchaser
further declares that it is aware that the documents and the information
that have been placed at its disposal or at the disposal of someone on its
behalf, in connection with its entering into this Agreement, including
documents and information that were exhibited in the information room, and
including answers by the Municipality, the Company or anyone on their
behalf to questions, and including information given during tours and at
meetings, were provided solely for its convenience and without this
imposing any liability on the Municipality and/or the Company and/or any
of the bodies connected with either of them, in respect of the correctness
or completeness of such information and documents or the absence of any
other information or document, and without such information and documents
or the absence thereof being deemed to be a representation for purposes of
entering into the Agreement.
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4.10
|
That
without derogating from the provisions of Clause 13 below, the Purchaser
hereby irrevocably waives any claim and/or allegation and/or right of
set-off and/or right to a reduction in the consideration or a right to
cancel the Agreement, as against the Municipality and/or the Company
and/or as against the bodies connected with either of them, of any type
and based on any cause of action, subject to the condition that the
Company shall fulfill its obligations as expressly enunciated in this
Agreement.
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13
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4.11
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The
Purchaser declares and confirms that it is aware that the Municipality
will not attend to registration of the rights of leasehold in and to the
Municipality Lands into the Purchaser’s name at the Land Registry, but it
will, at the Purchaser’s request, sign all in the applications, the forms,
declarations, deeds of leasehold and the remaining documents that will be
required for preparing files for registration of the leasehold rights in
the Municipality Lands in the Purchaser’s name in the Land
Registry. For the removal of doubt it is clarified that nothing
contained in the provisions of this sub-clause shall derogate from the
Municipality’s obligations pursuant to Clause 9 of this
Agreement.
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4.12
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Cancelled.
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4.13
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That
all the Purchaser’s representations and declarations pursuant to this
Clause 4 will be correct both at the time of signing of this Agreement,
and also at the date of delivery of the right of use and at the date of
delivery of possession. Declarations verifying the
representations are attached to this Agreement as Appendix
4.13.
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4.14
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That
by virtue of it having been told that the Company and the Municipality are
the owners of rights in the Remainder of the Project Lands which are not
being sold to the Purchaser in the scope of the transaction that is the
subject of this Agreement, it is agreed that in connection therewith the
provisions of Appendix
4.14 to this Agreement, which forms an integral part hereof, shall
apply to the parties in addition to the provisions of this
Agreement.
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4.15
|
That
it is aware that the sale is being effected in reliance on the correctness
and completeness of all its representations and declarations as set forth
in this Agreement.
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4.16
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Timetables
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4.16.1
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The
Purchaser undertakes to act diligently and uninterruptedly in all aspects
connected with the planning, licensing and construction of the Purchaser’s
Project in order to meet the timetables set forth in Appendix 4.16 to this
Agreement (hereinafter: “the
Timetables”). It is agreed that the Timetables are
indicative, but coupled with that is agreed, in the case of any divergence
of more than 6 months in any of the milestones included in the Timetables
which occurs up to the time of actual payment of the second payment or up
to the time of the implementation of the first building permit (as defined
in Clause 6.2.4 below), whichever is the later, then without derogating
from any remedy available to the Municipality according to any law and
agreement (excluding only the right to agreed damages as stated in Clause
14 below), the Company will be entitled to agreed damages from the
Purchaser in respect of such divergence in an amount equivalent to NIS
36,240 for each month of default (and for a pro rata portion of
such damages in respect of part of a month), plus indexation differences
(as defined in this
Agreement).
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4.16.2
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Without
derogating from the generality of the contents of sub-clause 4.16.1 above,
the Purchaser undertakes to take steps for the issue of an excavation and
shoring permit at the earliest date it is possible to do
so. The Purchaser further undertakes to commence performing the
excavation and shoring works within nine weeks from a decision being taken
by the local committee / the licensing authority in regard to the issue of
an excavation and shoring permit, subject to payment of fees and levies
only (hereinafter in this sub-clause: “the Decision”) provided
that the Decision is taken before September 2010. Where the
Decision is taken after September 2010, the Purchaser will commence
execution of the excavation and shoring works not later than March 15,
2011. It is agreed that in the case of a divergence of more
than six weeks from the Timetables specified in this sub-clause 4.16.2,
the Company will be entitled, without derogating from any remedy available
to the Company according to any law and agreement (excluding only the
right to agreed damages as stated in Clause 14 below), to compensation
according to the amounts of damages specified in sub-clause 4.16.1
above.
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14
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4.16.3
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The
Purchaser further undertakes that up to the end of 48 months from the date
of implementation of the first building permit (as defined in Clause 6.2.4
below), the commercial areas in the Purchaser’s Project and the Sports
Center and the School will be completed in a manner whereby up to the
aforesaid date an application will be lodged by it for receipt of “Form 4”
(which constitutes approval for initial occupation) in respect of the
commercial areas in the Purchaser’s Project, the Sports Center and the
School. It is agreed that in the case of a divergence from the
Timetables specified in this sub-clause 4.16.3, the Company will be
entitled, without derogating from any remedy available to the Municipality
according to any law and agreement (excluding only the right to agreed
damages as stated in Clause 14 below), to agreed damages from the
Purchaser in respect of such divergence in a sum equivalent to NIS 24,160
for each month of default (or a pro rata share of such
damages in respect of part of a month) in respect of the first 6 months of
default or part thereof, plus a sum of NIS 48,320 for each month of
default (and a pro
rata share of such damages in respect of part of a month) in
respect of 6 months default after the first 6 months or any part thereof,
and plus a sum of NIS 72,480 for each month of default (or a pro rata share of such
damages in respect of part of a month) in respect of each month of default
thereafter, or any portion
thereof.
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The
amounts of damages specified in this clause above will bear indexation
differences (as defined in this Agreement).
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4.16.4
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It
is agreed that if there should be an impediment to meeting the Timetables
prescribed in sub-clauses 4.16.1-4.16.3 the origin of which is force majeure as
recognized at law, then subject to the condition that the Purchaser shall
invoke all the necessary means in order to remove or eliminate the
impediment, the period of the impediment due to force majeure as
aforesaid will not be counted as part of the times for purposes of this
sub-clause 4.16 above.
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4.16.5
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It
is agreed that a precondition to the excavating of the basements which
will be below that portion of Parcel 93 which is marked in xxxx on the
drawings attached to this Agreement as Appendices A1-A2 will be
in coordination with and with the prior consent of the Administration,
including the setting of a timetable for completion of the construction of
the basements and road above it and finding solutions for entry and exit
to the Remainder of the Project Lands during the period of construction of
these specific basements.
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4.17
|
The
Purchaser undertakes that within 6 months from the date of signing of this
Agreement it will submit an amended Architectural Design Plan to the Local
Committee and within 10 months from the date of signing of this Agreement
will lodge an application for a building permit in relation to the entire
Purchaser’s Project, which will be based on the aforesaid amended
Architectural Design Plan. It is clarified that in a case in
which lodgment of the application for a building permit as referred to in
this sub-clause encounters opposition, prior to lodgment of the
application, from the authorized entities at the planning authorities,
then the application for a building permit that will be lodged by the
Purchaser will be for only 12 floors. It is agreed that the
Purchaser will be entitled to include in the application for such building
permit, units having an average area as stated in sub-clause 6.3.5
below. Nothing contained in the provisions of this sub-clause
shall derogate from the remaining provisions of this Agreement in regard
to the planning and design of the Purchaser’s
Project.
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15
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4.18
|
Without
derogating from the provisions of Appendix 4.14 of this Agreement, the
Purchaser undertakes that the drawing up and signing of the Architectural
Design Plan, applications for a building permit and any other planning
and/or statutory document that may be submitted by it or by someone on its
behalf to the planning authorities, in connection with the Purchaser’s
Project (as distinct from the Public Buildings), will be performed in
relation to the Purchaser’s Project as a whole (as distinguished from the
Public Buildings) and to all the documents mentioned above, by an
architect, constructor and one traffic consultant whose identity shall be
approved by the Company and the
Municipality.
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4.19
|
The
Purchaser declares that it is aware that all the actions and/or
undertakings and/or representations of the Municipality pursuant to this
Agreement and/or in connection herewith are in the Municipality’s capacity
as owner of the Project Lands, and that none of the aforesaid actions
and/or undertakings and/or representations will have the effect of binding
the Local Committee or any other statutory or planning
body.
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4.20
|
That
it is aware that the undertakings of the Interested Parties as defined at
the foot of this Agreement do not release it from any of its obligations
under this Agreement and that the deed of undertaking of the Interested
Parties and/or the fulfillment of the obligations of the Interested
Parties or any of them pursuant thereto shall not derogate from any of the
remedies available to the Municipality against the Purchaser in accordance
with the provisions of this Agreement and the
law.
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5.
|
The
transaction:
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|
5.1
|
The
Municipality hereby sells the Property Sold to the Purchaser, and the
Purchaser hereby buys the Property Sold from the Municipality, for the
consideration and on the conditions as set forth in this
Agreement.
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It is
clarified that the rights being sold by the Municipality in the Municipality
Lands and in the Additional Real Estate Rights as defined in this Agreement, are
long leasehold rights for a leasehold period ending on August 31,
2099.
It is
clarified that in the framework of the Property Sold the Purchaser assumes the
Obligations and Commitments Transferred at the dates specified in this Agreement
below, coupled with a full, irrevocable and absolute release and exemption for
the Company from the Obligations and Commitments Transferred, and in accordance
with the deed of assignment attached to this Agreement as Appendix
10.4.2.
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5.2
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Liability
of individual parties who make up the
Purchaser
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|
5.2.1
|
It
is agreed that the liability of the individual parties who make up the
Purchaser for the fulfillment of the Purchaser’s obligations under this
Agreement are joint and several, except with respect to the following
obligations:
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16
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5.2.1.1
|
Payment
of the consideration as set forth in sub-clause 5.2.4
below;
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|
5.2.1.2
|
Construction
of the Public Buildings as stated in Clause 7 below, which will be solely
under the responsibility of the Housing
Company;
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5.2.1.3
|
Declarations
and undertakings of the individual parties who make up the Purchaser which
are the subject of sub-clauses 4.1 and
4.2;
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|
5.2.2
|
Without
derogating from the foregoing in this sub-clause, it is hereby made known
to the Municipality by the Purchaser that the individual parties who make
up the Purchaser are buying the Property Sold according to a division that
has been decided upon between them prior to the signing of this Agreement,
without this derogating from any obligations of any of them in accordance
with the provisions of this Agreement. Solely for the sake of
convenience and only for registration purposes, it is agreed that the
individual parties who make up the Purchaser will be deemed to be
purchasers of the Municipality Lands and the Additional Real Estate Rights
in relative shares between them (in musha) as
follows: the Housing Company – 60%, the Mall Company –
40%. For the removal of doubt it is clarified that the
proportionate shares mentioned above are made known to the Municipality
solely for purposes of information, that the Municipality is not bound in
any way in relation to such division, and that the aforesaid division does
not and will not derogate from any of the Municipality’s rights vis-à-vis the
individual parties who make up the Purchaser and/or derogate from any of
the Purchaser’s obligations to the Municipality (both with respect to the
joint and several obligations of the individual parties who make up the
Purchaser to the Municipality and also in relation to the obligations of
any of the individual parties who make up the Purchaser severally as
against the Municipality, all according to the provisions of this
Agreement).
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5.2.3
|
Cancelled.
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|
5.2.4
|
With
respect to liabilities for payment of “the consideration” (as
defined below), the following provisions will
apply:
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|
5.2.4.1
|
Liability
for payment of the Basic
Consideration will be divided in such a way that the Housing
Company will pay the Municipality NIS 137,712,000 plus indexation
differences, out of the Basic Consideration, and the Mall Company will pay
the Company NIS 91,808,000 plus indexation differences, out of the
Basic Consideration, all together with V.A.T. as prescribed by law,
according to the following
division:
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|
|
5.2.4.1.1
|
“The First Payment” (as
defined below) will be divided in such a way that the Housing Company will
pay the Municipality NIS 26,237,760 of the First Payment, and the
Mall Company will pay the Municipality NIS 17,491,840, of the First
Payment, all plus indexation
differences.
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17
|
|
5.2.4.1.2
|
“The Additional First
Payment” (as defined below) will be divided in such a way that the
Housing Company will pay the Municipality NIS 5,798,400 of the Additional
First Payment, and the Mall Company will pay the Municipality NIS
3,865,600 of the Additional First Payment, plus indexation
differences.
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|
|
5.2.4.1.3
|
“The Later First
Payment” (as defined below) will be divided in such a way that the
Housing Company will pay the Company NIS 5,509,930 of the Later First
Payment and the Mall Company will pay the Company NIS 3,673,286 of the
Later First Payment, plus indexation
differences.
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|
|
5.2.4.1.4
|
“The Second Payment” (as
defined below) will be divided in such a way that the Housing Company will
pay the Municipality NIS 92,917,910 of the Second Payment, and the Mall
Company will pay the Municipality NIS 66,777,274 of the Second Payment,
plus indexation differences.
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|
|
5.2.4.1.5
|
“The Third Payment” (as
defined below) will be paid by the Housing Company in full, together with
indexation differences.
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|
|
5.2.4.1.6
|
Each
of the individual parties who make up the Purchaser undertakes to pay
the Municipality its share specified above in the Basic Consideration in
relation to each of the payments mentioned in Clause 6 below and at the
times specified therein.
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|
|
5.2.4.2
|
The
liability for payment of “the additional
consideration” (as defined below) shall be imposed solely on the
Housing Company.
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|
|
5.2.4.3
|
Without
derogating from the remaining provisions of this Agreement, it is agreed
that until actual settlement of the Second Payment, in a case of: (1) a
breach of any of the obligations set forth in sub-clauses 5.2.1.1 to
5.2.1.3 above, including the obligations to make any payment on account of
the consideration by any of the individual parties who make up the
Purchaser, which was not rectified by it within the time specified in this
Agreement for rectification of the breach and (2) the occurrence of one of
the events mentioned in sub-clause 18.7 below with respect to any of the
individual parties who make up the Purchaser (hereinafter: “the Defaulting Individual
Purchaser”) the following provisions will
apply:
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|
|
5.2.4.3.1
|
The
right will be conferred on the Company and the Municipality to cancel this
Agreement and the Municipality Lands Agreement vis-à-vis the
Defaulting Individual Purchaser, and to hold forfeit from the Defaulting
Individual Purchaser the
full amount of the agreed damages (as defined below) calculated on
a basis of the full Basic Consideration as defined in this Agreement and
in the Municipality Lands Agreement (including by way of foreclosing on
the sale process guarantee and/or holding forfeit the amounts that were
paid to the Company and to the Municipality on account of the
consideration by the Defaulting Individual Purchaser up to such time),
with this being in addition to the remaining remedies available to the
Company and to the Municipality as against the Defaulting Individual
Purchaser in accordance with any law and/or
agreement.
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18
|
|
5.2.4.3.2
|
An
individual purchaser who is not the Defaulting Individual Purchaser
(hereinafter: “the
Complying Individual Purchaser”) will be given a period of 45 days
from the date of cancellation of the Agreement as against the Defaulting
Individual Purchaser (hereinafter in this sub-clause: “the Date of
Cancellation”), in the course of which the Complying Individual
Purchaser will be entitled to present for the approval of the Company and
the Municipality the identity of a third party (hereinafter: “the Substitute on behalf of
the Purchaser”) who: (1) has irrevocably undertaken in writing
vis-à-vis the
Complying Individual Purchaser and vis-à-vis the Company
and the Municipality to step into the shoes of the Defaulting Individual
Purchaser under the terms and conditions of this Agreement and to sign the
transfer documents as defined below with the Company and the Municipality;
(2) has been approved by the financing bank (if one exists at that stage)
as being a party who will step into the shoes of the Defaulting Individual
Purchaser in the contractual arrangement with the financing bank and has
signed all the documents in connection therewith; and (3) has undertaken
to the Company and the Municipality to make the additional First Payment
and/or the later First Payment and/or the second payment, as the case may
be, within 30 days from the date of its approval as a substitute by the
Company and the Municipality (and to the extent that the time for making
the additional First Payment and/or the later First Payment and/or the
second payment has not yet arrived – to make payment of each of them on
the due date thereof). If the Company and the Municipality, in
their sole discretion, approve the identity of the substitute on behalf of
the Purchaser (after having been satisfied, inter alia, that the
substitute has equity capital and financial means to pay its share of the
consideration without delay and to fulfill the remaining obligations under
this Agreement and the Municipality Lands Agreement), then the parties
shall, within 14 days from the date of the approval, sign all the
documents that will be required by the Company and the Municipality for
purposes of arranging the substitute on behalf of the Purchaser’s stepping
into the shoes of the Defaulting Individual Purchaser (hereinafter: “the Transfer
Documents”), and settlement of the additional First Payment and/or
settlement of the later First Payment and/or settlement of the second
payment, as the case may be, will be made not later than 30 days from the
date of approval of the substitute on behalf of the Purchaser, and to the
extent that the time for making the additional First Payment and/or the
later First Payment and/or the second payment has arrived – to make
payment of each of these on the due date
thereof.
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19
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5.2.4.3.3
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If
a Substitute on behalf of the Purchaser is not presented to the Company
and the Municipality and/or if the Substitute on behalf of the Purchaser
is not approved by the Company and the Municipality within 45 days from
the Date of Cancellation and/or in a case in which the substitute has not
signed the Transfer Documents with the Company and the Municipality, then
the Company and the Municipality will have a period of 45 days in which to
present to the Complying Individual Purchaser a third party who will step
into the shoes of the Defaulting Individual Purchaser according to the
terms and conditions of this Agreement and the conditions of any
additional agreement that may be signed between the individual parties who
make up the Purchaser as between themselves at the latest up to the date
on which the default by the Defaulting Individual Purchaser occurred
(hereinafter: “the
Substitute on behalf of the Company and the
Municipality”).
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5.2.4.3.4
|
If
the Company and the Municipality do not present a Substitute on behalf of
the Company and the Municipality or the Complying Individual Purchaser has
not approved the identity of the Substitute on behalf of the Company and
the Municipality, or if the conditions for the substitute stepping into
the shoes of the Defaulting Individual Purchaser have not been agreed
between the Complying Individual Purchaser and the Substitute on behalf of
the Company and the Municipality, then the Company and the Municipality
will be entitled to cancel this Agreement also vis-à-vis the Complying
Individual Purchaser, and in a situation in which the identity of the
Substitute on behalf of the Company and the Municipality has not been
approved by the Complying Individual Purchaser or in a case in which the
Complying Individual Purchaser fails to sign the Transfer Documents, then
and in that event the Company and the Municipality will be entitled to
agreed damages from the Complying Individual Purchaser in a sum equivalent
to 10% of the total share of the Complying Individual Purchaser in the
Basic Consideration in accordance with this Agreement and pursuant to the
Company’s Lands Agreement (including by way of foreclosure on the Sale
Process Guarantee and/or the holding forfeit of the amounts which were
paid up to such time by the Complying Individual Purchaser to the Company
and the Municipality on account of the
Consideration).
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|
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5.2.4.3.5
|
For
the removal of doubt it is clarified that cancellation of the Agreement as
against the Defaulting Individual Purchaser in the circumstances as
described in sub-clause 5.2.4.3.1 and cancellation of the Agreement as
against the Complying Individual Purchaser in the circumstances as
described in sub-clause 5.2.4.3.4 will be deemed to be lawful cancellation
for all intents and purposes.
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|
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5.2.4.4
|
It
is further clarified for the avoidance of doubt that in the event of a
breach of any of the Purchaser’s obligations under this Agreement by two
individual parties who make up the Purchaser or upon the occurrence of one
of the events mentioned in sub-clause 18.7 below with respect to two
individual parties who make up the Purchaser, the Municipality will have
all the remedies according to any law and agreement available to it as
against two individual parties who make up the Purchaser (including, and
without derogating from the generality of the foregoing, a right of
cancellation, a right to receive agreed damages, and so forth), subject to
the provisions of sub-clause 18.8
below.
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20
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5.2.5
|
The
Purchaser undertakes that in the agreement between it and the financing
bank (as defined below) both in relation to financing of the purchase of
the Land and also in relation to the construction loan/s the following
arrangements and/or provisions will be
included:
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|
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5.2.5.1
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The
financing bank’s undertaking to give the Purchaser and/or any of the
individual parties who make up the Purchaser written warning notice prior
to a loan being made immediately due and payable in the scope of which
notice the Purchaser and/or any of the individual parties who make up the
Purchaser will be given an extension of time to cure the breach in respect
of which the warning notice was given (hereinafter: “the Warning Notice”),
except in certain cases as is customary in financing agreements for
projects of this sort in which the bank reserves the right not to give
notice.
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5.2.5.2
|
The
financing bank’s obligation to send the Municipality Warning Notices in
each of the cases in which the Purchaser will be entitled to receive same,
simultaneously with sending a Warning Notice to the
Purchaser.
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5.2.5.3
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An
arrangement pursuant to which in a situation in which there are grounds
for making a loan immediately due and payable as against two individual
purchasers in consequence of which a Warning Notice will be given by the
financing bank and the time for rectifying the breach that was specified
in the Warning Notice has passed and the breach has not been cured, then
and in that event a period of exclusivity will be granted by the bank to
the Company for a period of 120 days in the course of which the Company
and the bank will conduct exclusive negotiations with the objective of
reaching an agreement that will allow the continued implementation of the
Purchaser’s Project by the Company or by someone on its behalf, whether by
way of the Company or someone on its behalf stepping into the Purchaser’s
shoes as a borrower, or by way of the debt being purchased by the Company
or someone on its behalf, or by way of the purchase by the Company or by
someone on its behalf of the Company’s Lands and/or the Municipality Lands
and/or the Additional Real Estate Rights from the bank or through the bank
by realization of the encumbrance to the financing bank in the court and
with its approval, or in any other manner to the satisfaction of the bank
and the Company. The Purchaser hereby gives its irrevocable
consent to an arrangement that may be formulated with the agreement of the
bank and the Company and waives any allegation and/or demand in connection
therewith, subject to the condition that the bank acts in accordance with
its obligations according to law, including the fact that the arrangement
between the bank and the Company shall be made in the course of complying
with the bank’s obligations to the Purchaser according to law and in
accordance with the Construction Loan
Agreement.
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21
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5.2.5.4
|
An
arrangement pursuant to which in a case where there are grounds for making
a loan immediately due and payable as against any of the individual
parties who make up the Purchaser (hereinafter in this sub-clause: “the Defaulting Individual
Purchaser”) as a consequence of which a warning notice will be
given by the financing bank in respect of such grounds and the time for
rectifying the breach as was specified in the warning notice has passed
and the breach has not been cured, then and in that event an individual
party who makes up the Purchaser who is not the Defaulting Individual
Purchaser (hereinafter in this sub-clause: “the Complying Individual
Purchaser”), or someone on its behalf, whose identity shall be
approved in advance by the Company and the Municipality in their sole
discretion (hereinafter: “the Substitute vis-à-vis the Bank”) will have
the right vis-à-vis the financing
bank to step into the shoes of the Defaulting Individual Purchaser and
with respect to its rights in the Purchaser’s Project, on terms and
conditions as shall be decided with the financing bank, and in such case,
and subject to compliance by the Substitute vis-à-vis the Bank with the
conditions set forth in Clause 5.2.2.3.2 above and the Substitute
vis-à-vis the Bank signing the Transfer Documents, the Substitute
vis-à-vis the Bank will also be deemed to be a substitute for the
Purchaser who has been approved by the Company and the
Municipality. If grounds for making a loan immediately due and
payable have occurred, and the Complying Individual Purchaser or someone
on its behalf has not stepped into the shoes of the Defaulting Individual
Purchaser, or in a case in which the identity of the entity on behalf of
the Complying Individual Purchaser has not been approved by the Company
and the Municipality, then subject to the condition that the Company meets
the criteria prevailing at that time at the financing bank for approval of
the identity of a borrower in a project such as the Purchaser’s Project,
the Company will have the right that “someone on behalf” of the Complying
Individual Purchaser shall, vis-à-vis the financing
bank, step into the shoes of the Defaulting Individual Purchaser and its
rights in the Purchaser’s Project, under such conditions as shall be
decided with the financing bank as aforesaid. [The deletion constitutes
adjustment to the existing text of the Company’s
Agreement].
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5.2.5.5
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The
individual parties who make up the Purchaser undertake that in the
agreement of the individual parties who make up the Purchaser and/or
another agreement that may be made between them, provisions will be
included that conform with the contents of sub-clause 5.2.5
above.
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6.
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The
consideration:
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6.1
|
In
consideration for the Property Sold the Purchaser will pay the
Municipality (in accordance with the provisions of sub-clause 5.2 above) a
Basic Consideration in an aggregate amount of NIS 229,520,000 (two hundred
and twenty nine million five hundred and twenty thousand new shekels),
plus indexation differences and together with V.A.T. as prescribed by law
against receipt of a casual transaction form (hereinafter: “the Basic
Consideration”). In addition to the Basic Consideration,
the Housing Company will pay the Municipality the additional consideration
as defined in Clause 6.3 below, plus V.A.T. as prescribed by law against
receipt of a casual transaction form (the Basic Consideration together
with the additional consideration will be referred to below as: “the
Consideration”).
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22
It is
clarified that for purposes of this Clause 6 including all the sub-clauses
hereof, the term “against receipt of a casual transaction form” will have the
meaning ascribed thereto in sub-clause 6.10. below.
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6.2
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The
Basic Consideration will be paid by the Purchaser in the manner and at the
times set forth below:
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6.2.1
|
A
sum of NIS 43,729,600, together with indexation differences based on
linkage to the Consumer Price Index and plus interest at an annual rate of
2.5% in respect of the period commencing from April 15, 2010 and up to the
date of signing of this Agreement (hereinafter: “the First Payment”)
shall, on the date of signing of this Agreement, be deposited in a trust
account to be opened by the Trustee (hereinafter: “the Trust
Account”). The First Payment shall be paid out of the
Purchaser's independent resources and without any encumbrance over any of
the Purchaser’s rights pursuant to this Agreement and/or the Municipality
Lands, the Additional Real Estate
Rights.
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Contemporaneous
with the deposit of the First Payment moneys in the Trust Account, the Purchaser
shall lodge with the Trustee a check made payable to the Municipality in the
amount of the V.A.T. in respect of the First Payment, the due date for payment
of which is blank (hereinafter: “the Check for
V.A.T.”). The parties hereby instruct the Trustee to act in
relation to the aforesaid V.A.T. payment as follows:
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(a)
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In
a case in which the Trustee receives notice from the tax consultant on
behalf of the Municipality stating that the lawful date for making payment
of the V.A.T. which is the subject of the First Payment is the 15th
of the month following the date on which the First Payment was deposited
in trust, the parties hereby instruct the Trustee to fill in the date of
the check in respect of the V.A.T. and to send it to the Municipality up
to the 5th
of such month (even if the conditions stipulated below for release of the
First Payment moneys to the Municipality have not been
fulfilled);
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(b)
|
Should
the Trustee receive a notice from the tax consultant on behalf of the
Municipality to the effect that the lawful date for payment of the V.A.T.
in respect of the First Payment is the 15th
of the month following the month in which the condition precedent was
fulfilled and transfer of the First Payment moneys from the Trust Account
in the Municipality (hereinafter – “the Deferred Date of
Payment”), then and in that event the parties hereby give the
Trustee an instruction to fill in the date of the check in respect of the
V.A.T. for the 5th
of the month following the Deferred Date of Payment and to send it to the
Municipality by the 5th
of that month.
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3
business days after the 15th of the
month in which the check in respect of the V.A.T. was cashed by the
Municipality, the Municipality shall send the Purchaser a casual transaction
form.
23
Within 7
business days from the date on which the condition precedent to this Agreement,
as defined in Clause 12 below, is fulfilled, the Municipality will register a
caveat in favor of the
Purchaser over the Municipality’s rights in Parcels 92, 93, 95 and 114 Block
7104 (where the Municipality’s rights are in the same condition as they are at
the time of signing of this Agreement, and inter alia it is hereby agreed that
at the time the caveat over Parcel 92 was registered the leaseholds which have
expired and have not yet been expunged, as stated in Clause 3.1 above, will be
registered, and the aforesaid caveat will be registered
accordingly). Simultaneously registration of such caveat and registration of a
caveat in favor of the
Purchaser over the Company’s Existing Leasehold as stipulated in the Company’s
Lands Agreement, the Trustee will transfer the First Payment monies together
with the fruits thereof to the Municipality. If caveats have not been
registered as aforesaid due to an impediment which is not connected with the
Purchaser, the aforesaid caveats will be registered
within 2 business days from the date of removal of the impediment, and upon
registration thereof the Trustee shall transfer the First Payment monies,
together with the fruits thereof, to the Municipality.
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6.2.2
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A
sum of NIS 9,664,000 together with indexation differences (as defined
above) in respect thereof (hereinafter: “the Additional First
Payment”), plus V.A.T. as prescribed by law (which shall be paid in
the manner stated in Clause 6.10 below), shall be paid by the Purchaser
directly to the Municipality by way of bank check, within 90 days from the
date of transfer of the First Payment Moneys from the Trustee to the
Municipality, as stated in sub-clause 6.2.1 above. The
Additional First Payment shall be paid out of the Purchaser’s own
resources and without any encumbrance on any of the Purchaser’s rights
pursuant to this Agreement and/or in the Municipality Lands and/or the
Additional Real Estate
Rights.
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6.2.3
|
Within
90 days from the date specified for making of the Additional First
Payment, a sum of NIS 9,183,216 together with indexation differences (as
defined above) and plus V.A.T. as prescribed by law (which shall be paid
as stated in sub-clause 6.10 below) shall be paid by the Purchaser to the
Municipality by way of bank check (hereinafter: “the Later First
Payment”), against return to the Purchaser of
the sale process guarantee. The Later First Payment shall be
paid out of the Purchaser’s own resources without any encumbrance on any
of the Purchaser’s rights pursuant to this Agreement and/or in the
Municipality Lands and/or the Additional Real Estate
Rights. The Purchaser undertakes to cause an extension of the
sale process guarantee from time to time in a manner whereby the guarantee
will remain in force until actual settlement of the Later First
Payment. If the sale process guarantee is not extended as
aforesaid at least 21 days before the date of its expiration, the Company
will be entitled to foreclose on the sale process
guarantee.
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6.2.4
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A
sum of NIS 159,695,184 together with indexation differences (as defined
above) in respect thereof (hereinafter: “the Second Payment”)
plus V.A.T. as prescribed by law (which shall be paid as stated in Clause
6.10 below) shall be paid by the Purchaser directly to the Municipality:
(1) 7 business days from the date on which notice is given by the
Municipality to the effect that subject to payment of fees and levies
only, it will be possible to issue the first building permit (even if such
notice relates to a building permit that will be issued in relation to
only part of the Company’s Lands and/or the Municipality Lands and/or the
Additional Real Estate Rights, but excluding an excavation and shoring
permit, a permit for a sales office, signboards, fencing and similar other
permits that are only ancillary and subordinate to the Project)
(hereinafter: “the First
Building Permit” and “Notice Regarding the First
Building Permit”, respectively), or (2) after the elapse of 24
months from the date of signing of this Agreement, whichever of (1) or (2)
is the later. For the avoidance of doubt it is hereby clarified
that such notice in relation to a permit for construction of the basement
floors or part thereof (even if it is issued separately from the building
permit for the above-ground areas) will be deemed to be Notice Regarding
the First Building Permit for purposes of this Clause
6.2.4. The Second Payment shall be made by way of a bank check
and subject to fulfillment of the matters set forth in sub-clause 6.2.5
above.
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24
For the
removal of doubt it is clarified that under all circumstances, whether or not a
building permit is issued, irrespective of the reason for the delay in or
failure to issue the building permit, the Second Payment shall be made not later
than the end of 24 months from the date of signing of this Agreement and in
accordance with the provisions of this sub-clause above, without being dependent
on the fulfillment or non-fulfillment of any circumstances, including in
connection with the issue or non-issue of the First Building Permit, and shall
be in the nature of being an absolute obligation for payment at the specified
time.
The
Purchaser undertakes to notify the Municipality in writing, in good time, as to
the anticipated date for issue of the First Building Permit.
The
Purchaser undertakes to give the Municipality written notice about the issue of
the First Building Permit immediately upon receipt thereof, and to furnish the
Municipality with a copy thereof.
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6.2.5
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The
Second Payment shall be made in a manner whereby at the date specified in
sub-clause 6.2.4 above for the making of the Second Payment, the parties
will meet at the Land Registry, and will simultaneously perform the
following actions:
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6.2.5.1
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The
Purchaser shall pay the Second Payment to the Municipality by way of bank
check.
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6.2.5.2
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The
encumbrance in favor of the financing bank as defined in Clause 16.6.3
below and as described in that
clause.
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6.2.5.3
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The
encumbrance in favor of the financing bank (as defined in Clause 16.7.3 of
the Company’s Lands Agreement) in accordance with one of the alternatives
listed in the abovementioned clause of the Company’s Lands
Agreement.
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6.2.5.4
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The
Municipality will deliver possession of the Municipality Lands and the
Additional Real Estate Rights to the Purchaser as described in Clause 10
below. In addition, by virtue of delivery of possession of the
Municipality Lands, the amount of the V.A.T. which is the subject of the
Second Payment and the amount of the V.A.T. which is the subject of the
Third Payment will be paid to the Municipality by the Purchaser at the
Date of Delivery of Possession by way of a bank
check.
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6.2.5.5
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The
Municipality shall deliver the certificates mentioned in sub-clauses 9.1
and 9.2 below to the Purchaser, if same have not been delivered up to that
date.
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25
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6.2.5.6
|
It
is clarified that the making of the Second Payment in accordance with this
Clause 6.2 shall be effected simultaneously with the making of the Second
Payment pursuant to Clause 6.2 of the Municipality Lands Agreement and
according to the conditions
thereof.
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6.2.5.7
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It
is hereby agreed that if a registration or procedural problem should arise
in creating any of the encumbrances included in the encumbrance to the
financing bank, then the parties will in good time discuss between
themselves and together with the financing bank the necessity for reaching
an appropriate arrangement that will be agreed upon by the parties and by
the financing bank in a manner that allows for the effecting of the Second
Payment.
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6.2.6
|
A
sum of NIS 7,248,000 together with indexation differences (as defined
above) in respect thereof and plus V.A.T. as prescribed by law (which
shall be paid in accordance with the provisions of sub-clause 6.10
(hereinafter: “the Third
Payment”) will be paid by the Housing Company directly to the
Municipality on the date of receipt of “Form 4” with respect to the first
commercial areas that will be constructed on the Company’s Lands and/or
the Municipality Lands and/or the Additional Real Estate Rights (except if
“Form 4” is received solely with respect to the commercial areas that will
be located on the first floors of the residential buildings in the
residential zone, if there are such) and against return of an irrevocable
power of attorney for expungement of a caveat mentioned in
Clause 9.5 below. The Third Payment shall be made by way of a
bank check.
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6.2.7
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In
relation to any amount that may be deposited in trust with the Trustee in
accordance with the provisions of this Clause 6, the Trustee shall act in
accordance with the letter of instructions to the Trustee which is
attached to this Agreement as Appendix
6.2.7, and deposit of such amount in trust with the Trustee, as
aforesaid, shall be deemed to be performance of the Purchaser’s obligation
to pay the aforesaid amount to the
Company.
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6.3
|
In
addition to the Basic Consideration, the Municipality will be entitled to
additional consideration from the Housing Company in relation to the
residential areas that will be erected on Xxxx Xx. 0 and in relation to
the areas of Plot No. 6, in the scope of the Purchaser’s Project, as
described below (hereinafter: “the Additional
Consideration”):
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6.3.1
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The
terms mentioned in this Clause 6.3 and all the sub-clauses hereof will
have the meaning ascribed to them in Clause 6.7.1
below.
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6.3.2
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If
the average selling price per sq.m. should exceed NIS 15,517 (excluding
V.A.T.) linked to the upside index as stated in Clause 6.3.4 below
(hereinafter: “the Basic
Price”), but be less than NIS 16,379 (excluding V.A.T.) linked to
the upside index as stated in sub-clause 6.3.4 below (hereinafter: “the Intermediate
Price”), the Housing Company will pay the Company an amount
equivalent to the full difference between the Intermediate Price and the
Basic Price where this is multiplied by the sale areas and the
Municipality’s share in the Additional Consideration, plus V.A.T. as
prescribed by law against receipt of a casual transaction
form.
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26
For example
–
In a case
in which there has been no rise in the upside index, the average selling price
per sq.m. will be NIS 16,000 (excluding V.A.T.) and the sale areas will stand at
50,000 sq.m., then the Additional Consideration to the Company will
be:
50,000* 24.16%*(16000-15517) = NIS 5,834,640 plus V.A.T. according
to law.
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6.3.3
|
If
the average selling price per sq.m. should exceed the Intermediate Price
(hereinafter: “the High
Price”), the Housing Company will pay the Municipality the
following cumulative amounts, together with V.A.T. according to law and
against receipt of a casual transaction
form:
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6.3.3.1
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The
full difference between the Intermediate Price and the Basic Price where
it is multiplied by the sale areas and by the Company’s share in the
Additional Consideration.
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6.3.3.2
|
50%
of the difference between the High Price and the Intermediate Price where
this is multiplied by the sale areas and by the Company’s share of the
Additional Consideration.
|
For example
–
In a case
in which the upside index has not risen, the average selling price per sq.m.
will be NIS 18,000 (excluding V.A.T.), the sale areas will stand at 50,000
sq.m., then the Additional Consideration to the Municipality will be the
following cumulative amounts:
50,000* 24.16%*(16379-15517) = NIS 10,412,960 plus V.A.T. according
to law.
50,000* 50%*24.16%*(18000-16379) = NIS 9,790,840 plus V.A.T. according
to law.
And altogether the Additional
Consideration to the Municipality will amount to a sum of NIS 20,203,800 plus
V.A.T. according to law.
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6.3.4
|
The
Basic Price and the Intermediate Price (as will be updated in accordance
with the provisions of sub-clause 6.3.5 below to the extent that same are
updated) will be linked to the index or to the Building Inputs Index,
according to the index to which the proceeds that will be received from
buyers of apartments will be linked and as will be mentioned in the sale
contract with the buyers of apartments (hereinafter: “the Upside Index”) and
will bear indexation differences at the percentage rise of the Upside
Index which is known at the time of doing the relevant accounting as
against the Upside Index that was known at the date of signing of an
agreement for the sale of the first apartment in the Purchaser’s Project
between the Purchaser and a third party, while a decline in the Upside
Index will not lead to a reduction of the Basic Price and the Intermediate
Price, as the case may be.
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27
|
6.3.5
|
If
building construction has been approved to the Housing Company pursuant to
which the average main area of an apartment will be less than 110 sq.m.
but will not be less than 91.7 sq.m. and the Company was held liable in
respect thereof for a betterment levy or payment of betterment and/or if a
concession was approved to the Housing Company in regard to the adding of
two additional floors in the buildings on Plot No. 1 from 12 to 14 floors
and in respect thereof the Purchaser was held liable for a betterment levy
or payment of betterment (hereinafter jointly: “the Specific Planning
Changes”), then: (1) the amount of the betterment or the betterment
levy that was paid by the Housing Company as was fixed according to law as
a consequence of the approval of the specific planning changes only
(whichever is the higher) or (2) an amount in a maximum sum of NIS
10,000,000 linked to the Upside Index (excluding V.A.T.) (hereinafter:
“the Betterment Tax
Ceiling”), whichever of (1) or (2) above is the lower (hereinafter:
“the Determining
Amount”), where same is divided by the sale areas, will be added
both to the Basic Price and to the Intermediate
Price.
|
For the
removal of doubt it is clarified that the aforesaid amount of NIS 10 million is
an upper limit, and that the Determining Amount as defined above (which will be
divided by the sale areas where the result of the division thereof by the sale
areas will be added to the Basic Price and to the Intermediate Price) will under
no circumstances exceed the Betterment Levy Ceiling.
For example
–
In a case
in which the Determining Amount stands at NIS 7,000,000 and the sale areas (of
all the apartments) stand at 50,000 sq.m., the following amount will be added
both to the Basic Price and to the Intermediate Price:
7,000,000
/ 50,000 = NIS 140.0
so that
the Basic Price will stand at NIS 15,657 and the Intermediate Price will stand
at NIS 16,519.
The
Housing Company undertakes to notify the Municipality, immediately after
receiving a demand from the local committee for payment of betterment or a
betterment levy in connection with any of the specific planning
changes. After receipt of such notice and if the Municipality so
wishes, the Housing Company will allow the Municipality to defend such demand
for payment, including the exhausting of objection and appeal rights according
to law, all at the times prescribed by law. It is clarified that
nothing contained in the provisions of this sub-clause shall constitute a
representation and/or any undertaking by the Company and/or the Municipality
and/or anyone on their behalf in relation to the approval of the Specific
Planning Changes.
For the
removal of doubt it is clarified that in every case in which the Determining
Amount as defined in this sub-clause above is lower than (a) the amount of
betterment or the betterment levy which was actually paid by the
Housing Company or (b) the amount of the Betterment Levy Ceiling, including in a
case in which the amount of the betterment or the betterment levy is reduced
after the actual payment thereof (such as – as a consequence of objection and
appeal proceedings), then the necessary adjustments and accounting will be made
as between the parties as a consequence of such reduction.
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6.3.6
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In
addition to the amounts mentioned in Clauses 6.3.2-6.3.3 (inclusive), the
Housing Company shall pay the Municipality, as part of the Additional
Consideration, an amount equivalent to one-half of the difference, if any,
between the selling price (including V.A.T.) in respect of a sale or
letting under leasehold or conferring of a right of use of any sort of a
parking place in the Purchaser’s Project that will be paid by any buyer of
an apartment or any third party (even if he is not a buyer of an
apartment) in respect of a parking place in the Purchaser’s Project
(excluding only a price that will be paid by any buyer of an apartment in
respect of a first parking place for an apartment) and a sum of NIS
100,000 (including V.A.T.) for each parking place (for the avoidance of
doubt it is clarified that this price is a consideration for all the
direct and indirect costs connected with the construction of parking
places as aforesaid, including and without derogating from the generality
of the foregoing, planning and construction of the parking places
including the envelope in respect thereof, the marking thereof,
installation of sprinklers within the confines thereof, installation of
fire extinguishing system, design and similar other costs) (where same is
linked to the Upside Index commencing from the date of signing of a sale
agreement in respect of the first apartment in the Purchaser’s Project
between the Housing Company and a third party and up to the time of any
actual payment), where this is multiplied by the Municipality’s share in
the Additional Consideration.
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6.4
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The
Additional Consideration will be calculated and paid at the following
times:
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6.4.1
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Interim
accounting
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6.4.1.1
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On
the 5th
of the first month of each calendar quarter, commencing from the date of
signing of the first agreement for the sale of an apartment between the
Housing Company and a buyer of an apartment, an interim accounting will be
done in relation to the Additional Consideration in respect of the
proceeds of the sales that have been received by the Purchaser in the
preceding quarter (hereinafter: “the Interim
Accounting”). The Interim Accounting will be carried out
with respect to each and every apartment the proceeds in respect of which
were paid in the preceding quarter in a manner whereby the average selling
price per sq.m. for each apartment will be determined on a basis of the
total proceeds of the sales which were received in respect thereof in the
preceding quarter (hereinafter: “Proceeds of the
Quarter”) where same is divided by “the partial sale
area”.
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For
purposes of this sub-clause “the partial sale area” means:
the sale areas (as defined below) which are the subject of each apartment where
same are multiplied by the ratio between the Proceeds of the Quarter for the
apartment (without indexation differences in respect thereof) and the total
proceeds specified for the apartment in the relevant sale
contract.
The
Municipality’s share in the Additional Consideration in accordance with the
Interim Accounting for each quarter will be paid to the Municipality, plus VAT
according to law, within 14 days from the date on which such accounting is
conducted.
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6.4.1.2
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The
Interim Accounting in each quarter will be carried out on a cumulative
basis having regard to the proceeds, the sale areas which are the subject
of those proceeds and having regard to the Additional Consideration in
respect of the quarters which preceded it. It is hereby agreed
that only commencing from the date of payment of the full Basic
Consideration, to the extent that it becomes apparent at the time of
conducting any Interim Accounting that overpayments of the Additional
Consideration, on a cumulative basis, have been paid to the Municipality,
the Municipality will refund to the Housing Company the amounts that were
overpaid to it as aforesaid, where such amounts are linked to the Upside
Index commencing from the date of the last accounting and up to the date
of the actual refund thereof, plus V.A.T. according to law, against
receipt of a valid tax
invoice.
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6.4.2
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Final
accounting
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Not later
than 7 days from the date of first occupation of the last residential building,
a final calculation will be made of the Additional Consideration in relation to
all the apartments in the Purchaser’s Project (hereinafter: “the Final
Accounting”).
In the
scope of the Final Accounting, the Additional Consideration that is due to the
Municipality will be calculated in relation to all the apartments in the
Purchaser’s Project on a basis of all the sale areas and all the proceeds of
sales (hereinafter: “the Final
Additional Consideration”).
If the
Final Additional Consideration should exceed the total amounts that are the
subject of the Additional Consideration that has been paid to the Municipality
up to such time, the balance will be paid to the Municipality, together with
V.A.T. according to law, within 14 days from the date of calculation of the
Final Accounting, where same is linked to the Upside Index from the date of the
accounting and up to the date of actual payment thereof to the
Municipality. As against that, if the payments that have been paid by
the Housing Company to the Municipality up to such time exceed the total Final
Additional Consideration, the Municipality will refund to the Housing Company
the amounts that were overpaid to it as aforesaid, where same are linked to the
Upside Index from the date of the last Accounting and up to the date of the
refund thereof to the Purchaser, together with V.A.T as prescribed by law and
against receipt of a tax invoice as prescribed by law within 14 days from the
date of calculation of the Final Accounting.
30
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6.5
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As
security for payment to the Municipality of the Additional Consideration,
the Housing Company shall deliver to the financing bank an irrevocable
instruction in relation to the account in which the total proceeds that
will be received from the buyers of apartments will be deposited
(hereinafter: “the
Proceeds Account”) pursuant to which the Housing Company will
instruct the financing bank to act in accordance with the instructions of
the arbiter as defined in sub-clause 6.7 below, in connection with the
release of money from the Proceeds Account to the Municipality, in
accordance with the results of the Interim Accountings that will be
conducted between the parties as stated in sub-clause 6.4.1 above and that
it should not allow the Housing Company to withdraw/transfer any money
from the Proceeds Account (including a transfer of money from the Proceeds
Account to the Housing Company’s expenses account), unless at the time of
any such withdrawal/transfer an early interim accounting is done, and in
accordance with the results thereof money will simultaneously be
transferred to the Company out of the Proceeds Account in accordance with
the instructions of the aforesaid arbiter. In the event that
the financing bank refuses to act in accordance with such irrevocable
instructions, other collateral will be decided upon by the parties to
secure payments of the Additional Consideration, to the satisfaction of
the Municipality. The Housing Company undertakes that the Mall
Company will not be a partner and/or a holder of rights and/or a
beneficiary in the Proceeds Account, that the Proceeds Account will be
specifically earmarked solely for proceeds that will be received from the
buyers of the apartments, that all the proceeds that will be received from
buyers of apartments will be deposited solely in the Proceeds Account, and
it undertakes to include an appropriate provision in the sale agreements
with the buyers of the apartments. The Housing Company further
undertakes that the Proceeds Account will be encumbered only to the
financing bank (subject to the Municipality’s rights to receive proceeds
in accordance with this sub-clause 6.5 and the rights of the Company to
receive proceeds in accordance with Clause 6.5 of the Municipality Lands
Agreement), and that no rights of whatsoever nature therein will be
granted to any third party.
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6.6
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Once
each month, not later than the 15th
of the succeeding calendar month, the Housing Company shall deliver to the
Municipality a detailed report of the sales that were made by the Housing
Company in the preceding month and of the proceeds of sales that are the
subject of the aforesaid sales. The Municipality will be
entitled to examine the report itself and/or through an accountant on its
behalf, and the Housing Company undertakes to furnish the Municipality
and/or the aforesaid accountant with all information and/or any document
that may be demanded for purposes of the aforesaid
examination.
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6.7
|
Differences
of opinion between the parties in connection with the calculation of the
Additional Consideration will be brought for the decision of Xxx Xxxxxx,
C.P.A., or if he is prevented from serving as arbiter, another partner in
his office, following a request from one of the parties to him
(hereinafter in this sub-clause: “the
Arbiter”). The Arbiter will be entitled for purposes of
making a calculation of the areas to be assisted by a real estate
appraiser and/or surveyor. The Arbiter will act as an expert
and not as an arbitrator, and his decision shall be final and binding on
the parties.
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6.7.1
|
For
purposes of this Clause 6, the following terms and expressions will have
the meanings set opposite
them:
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6.7.1.1
|
“Sale areas” – the
effective total of the areas of the apartments (which will be measured in
relation to each and every apartment according to the definition of the
term effective area of an apartment, as elucidated below), plus the
following areas (which will also be measured in relation to each apartment
separately in accordance with the provisions set forth in Clause 6.7.1.3
below): 33% of the areas of enclosed or open porches that are linked to
the apartments, 20% of the areas of the storerooms that are linked to the
apartments, 20% of the areas of one parking place which is linked to the
apartment (as distinct from additional parking places in excess of one
parking place per apartment), 5% of the areas of the gardens that are
linked to the apartments, and together with the pro rata share of the
apartment in the landing of its floor. Under all circumstances
it is hereby clarified that for purposes of calculating “the sale areas”,
areas will be counted once
only.
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31
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6.7.1.2
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“Effective area of
apartment” –
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|
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The
area contained in the polygon created by the lines that pass over the
outer side of the external walls of the
apartment.
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|
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For
these purposes –
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(1)
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“External
wall” – a wall which separates between the apartment and what is outside
of it, including between the apartment and a sun porch, between it and a
common area on the floor or between it and another apartment or
plan;
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Where the
external wall separates between the apartment and another apartment, the line of
the aforesaid polygon will pass through the center of the external
wall;
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(2)
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“The
outer sides of an external wall” – the sides of the wall without
finishing; in a case of a wall with stone cladding, the sides of the wall
will include the cladding.
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(3)
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In
a multi-level apartment the area will be calculated and particularized
with respect to each level in the apartment; the area of the apartment
will be the total areas of all the levels in the
apartment.
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The area
of each set of stairs in an apartment will be calculated once only according to
the horizontal projection of all the sloping and horizontal surfaces; the area
will be added to the level which ascends from the flight of
stairs.
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(4)
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In
calculating the area only the areas the height of which conforms with what
is required under the Planning and Building Regulations (Application for
Permit, Conditions thereof and Fees), 5730-1970 (hereinafter: “the Planning and Building
Regulations (Application for Permit)) will be
included.
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6.7.1.3
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The
areas of the porches, storerooms, parking places and the gardens will be
measured and calculated in accordance with the following
provisions:
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|
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6.7.1.3.1
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Areas
of enclosed or open porches that are linked to apartments – the floor area
that falls within the polygon created by the lines that pass through the
outer sides of the external walls or the constructed railings of the
porches and through the outer sides of the walls of the apartments that
border on the porch.
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|
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6.7.1.3.2
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Areas
of storerooms linked to apartments – the floor area that falls between the
walls of the storeroom plus the area of the wall; where the storeroom wall
separates between it and part of another storeroom/area, only the area
below one-half of the width of the wall will be included; where the
storeroom wall borders on a common area, the area of the wall will be
included in its entirety.
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32
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6.7.1.3.3
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Areas
of parking places – (area of one parking place which is linked to an
apartment) – the floor area of the parking place without walls and/or
thoroughfares.
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|
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6.7.1.3.4
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Areas
of gardens that are linked to apartments – the garden area includes the
area of the walls which support the perimeter
thereof.
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6.7.1.3.5
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“Floor landing” – the
area that falls within the lines that pass between the outer walls of the
floor landing (excluding shafts and voids), including one-half only of the
area of the stairwells that are located between the relevant floor and the
floor below it, which will be calculated according to the horizontal
projection of the sloping and horizontal
surfaces.
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6.7.1.4
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“Sale proceeds” – all
the amounts (excluding V.A.T.) that will actually be received from the
buyers of the apartments and/or in connection with the sale of the
apartments to the buyers of the apartments, including by virtue of sale
agreements and addenda to such agreements (including consideration in
respect of one parking place per apartment, porches, roofs, storerooms,
gardens, basements and so forth), and any additional consideration that
may be received from buyers of the apartments including, and without
derogating from the generality of the foregoing, penalty interest and
indexation differences that will be received from buyers of the apartments
in respect of arrears and agreed damages in respect of a cancellation of
agreements / contractual arrangements, together with indexation
differences to the Upside Index at the percentage rise in the known Upside
Index at the time the relevant accounting is done, as against the Upside
Index which was known at the time each payment was actually made by the
buyers of the apartments, where a fall in the Upside Index will not lead
to a reduction in the amount of the sale
proceeds.
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It is
clarified that in calculating the sale proceeds, the following payments will not
be taken into account:
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6.7.1.4.1
|
Any
payment for alterations and additions in excess of the specification for
the apartments, as defined in Clause 6.9.1 below, in the event that same
are paid directly to the executing contractor, and which are not due to
the Housing Company, directly or
indirectly.
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6.7.1.4.2
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That
portion of the payment in respect of legal expenses and attorneys’ fees
which will be collected from the buyers of apartments (hereinafter: “the Legal Expenses”)
and which will be paid by the Housing Company to the attorneys who
represent it in the sale agreements with the buyers of
apartments. The balance of the Legal Expenses (which is not
transferred by the Housing Company to the aforesaid attorneys) will be
included as part of the sale
proceeds.
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6.7.1.4.3
|
Payment
of buyers of apartments for water, electricity and gas meters and other
accessories such as that which will be purchased for them by the Housing
Company, on a basis that the full payment by the buyers of apartments will
be transferred onwards to the aforesaid suppliers of the
accessories.
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6.7.1.4.4
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Payments
by buyers in respect of refund of fees, costs of preparation of drawings
and payment to the Municipality in respect of the signing of the
condominium registration documents referred to in sub-clause 9.8.1 below,
provided that the total amount per apartment in respect of the components
mentioned in this sub-clause shall not exceed NIS 5,000 (excluding
V.A.T.), where same is linked to the Upside Index commencing from the date
of signing of this Agreement and up to the date of the relevant
accounting.
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6.7.1.4.5
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Payments
of management fees will be paid directly by the buyers of apartments to
the management company (and which are not payable, in whole or in part, to
the Housing Company, directly or
indirectly).
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6.7.1.5
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“Average selling price per
sq.m.” – the total sale proceeds where same are divided by the
total sale areas.
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6.7.1.6
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“The Municipality’s share in
the Additional Consideration” –
24.16%.
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6.8
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Xxxx
Xx. 0
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6.8.1
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It
is agreed between the parties that if any of the built areas on Plot No. 6
should be zoned or designated for use which is not residential, then the
Additional Consideration to which the Municipality will be entitled in
respect of the proceeds of any transactions (including sale and/or lease
and/or operation and so forth) that may be made in relation to Plot No. 6
will be according to a mechanism that will be agreed between the Company,
the Municipality and the
Purchaser.
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6.8.2
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The
Housing Company shall notify the Municipality and the Company shortly
after the date on which a decision is taken in connection therewith as to
the intended zoning for Xxxx Xx. 0 and in accordance therewith the
Company, the Municipality and the Housing Company will discuss the laying
down of the agreed mechanism for determining the Additional Consideration
in Plot No. 6.
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6.8.3
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It
is hereby expressly agreed, that notwithstanding anything else contained
in this Agreement, as long as no mechanism has been agreed in writing
between the Company, the Municipality and the Housing Company for the
Additional Consideration in respect of Xxxx Xx. 0, the Housing Company
will not be entitled to enter into sale and/or lease transactions and/or
contractual arrangements and/or other transactions of whatsoever nature in
connection with Plot No. 6, whether with respect to the land or with
respect to the built
areas.
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34
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6.8.4
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For
the avoidance of doubt it is hereby clarified that if the actual use that
will be planned or will be made of Plot No. 6 is for residential purposes,
then the Additional Consideration to which the Municipality will be
entitled in relation to the proceeds from Plot No. 6 will be as stipulated
in Clauses 6.3-6.7 above.
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6.9
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Provisions
regarding the standard of building and technical specifications which will
be attached to the sale agreements with buyers of
apartments
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6.9.1
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The
building construction in the residential zone and the apartments therein
shall be built at a standard which shall not be inferior to the standard
described in the main features of the specification, the simulations and
in the photographs that are attached to this Agreement as Appendix
6.9.1, whichever is the higher (hereinafter: “the Basic
Specification”).
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6.9.2
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The
apartments shall be sold to the buyers of apartments according to a
technical specification that shall not be inferior to the Basic
Specification (hereinafter: “the Apartments
Specification”).
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6.9.3
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Alterations
and additions in relation to the Apartments Specification shall be
requisitioned directly by the buyers of apartments from the executing
contractor. Any payment for alterations and additions as
aforesaid shall belong to the executing contractor and will not be
included in the sale proceeds. If and to the extent that the
Housing Company should receive any payments that are connected with the
aforesaid alterations and/or additions, directly or indirectly, then those
payments will be added to the sale
proceeds.
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The
Housing Company undertakes that if a credit should be due in respect of
cancellation of works that are included in the Apartments Specification, it will
be obtained from the executing contractor.
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6.10
|
Value
Added Tax
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6.10.1
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Each
payment imposed on any of the parties according to this Agreement shall be
paid together with V.A.T. according to law. In the case of
amounts which have been specifically stated in this Agreement as including
V.A.T., no V.A.T. shall be added in respect
thereof.
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6.10.2
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For
the removal of doubt it is clarified that in order to enable the Purchaser
to set off V.A.T. (to the extent that it is entitled to setoffs), in
respect of any V.A.T. payment imposed on the Purchaser, the Municipality
will issue the Purchaser a casual transaction form, with it being
clarified that for purposes of this Clause 6 and the sub-clauses thereof,
the term “against receipt
of a casual transaction form”) shall have the following meaning:
the furnishing of a casual transaction form to the Purchaser within three
business days after the 15th
of the month after the month in which each of the payments of the
Consideration mentioned in this Clause 6 was paid to the
Municipality. In addition the Municipality shall deliver to the
Purchaser a certificate regarding exemption from deduction of tax at
source. It is further clarified that every payment of V.A.T.
that may be imposed on the Purchaser shall be paid by it, and it will not
be entitled to impose any payment of V.A.T. on the
Municipality.
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35
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6.10.3
|
It
is agreed that the V.A.T. payments in respect of each and every payment of
the Consideration (both with respect to the Basic Consideration and also
in relation to the Additional Consideration) shall be paid by a post-dated
check the due date for payment of which is 5th
of the month following the month in which the payment was actually made,
except with respect to the first payment in relation to which the
provisions of sub-clause 6.2.1 above will apply and in respect of the
Second Payment and the Third Payment (in relation to which the V.A.T. will
be paid by a bank check on the same date on which the Second Payment is
paid). For the removal of doubt it is clarified that the time
of payment of the V.A.T. in respect of payments of the Consideration as
specified in this Agreement is the time specified in this sub-clause
6.10.
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6.10.4
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If
an approval is received from the V.A.T. authorities in accordance with
Section 20 of the Value Added Tax Law, 5736-1975, the parties undertake
(without derogating from any of their rights according to law) to act in
accordance with the aforesaid approval with respect to each payment that
will be paid as from the date of receipt of the approval. If
the signature of the Municipality on forms / documents is required for
purposes of obtaining such approval, the Municipality will sign such forms
/ documents subject to the condition that the forms / documents shall not
impose any financial obligations on the
Municipality.
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6.11
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Anticipation
of payments
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It
is hereby
agreed that the Purchaser will have the right to anticipate any of the payments
of the Consideration, including the Additional Consideration, with it hereby
being agreed as follows: (1) in relation to the bringing forward of any of the
payments of the Basic Consideration, such anticipated payment shall be made at a
discount rate of 4% per annum; (2) with regard to the bringing forward of any of
the payments of the Additional Consideration, such anticipated payment shall be
made by way of conducting an interim accounting at the dates earlier than the
dates specified in Clause 6 above for the conduct thereof, without such
anticipated payment causing any reduction in the extent of the payments of such
Additional Consideration that have been brought forward; (3) every anticipated
payment shall be made both vis-à-vis the Municipality
and also vis-à-vis the
Company, all subject to the giving of written notice to the Municipality and to
the Company at least 7 business days in advance.
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7.
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Public buildings, area
of the Municipality’s parking places, development of the open public
areas, and maintenance of the open public areas and the open private
areas
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7.1
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Public
buildings
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7.1.1
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The
Housing Company is obliged to build and erect the public buildings as
defined and described in the Construction Contract (including the
appendices thereto) which is attached to this Agreement as Appendix
7.1.1 and which will be signed simultaneous with the signing of
this Agreement (hereinafter: “the Public Buildings”
and “the Construction
Contract”, respectively) and to deliver same to the Municipality in
accordance with its abovementioned obligations and the provisions
set-forth below:
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36
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7.1.1.1
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Construction
of a country club-sports center and a school building on Plot No. 8, to an
overall aggregate extent of approximately 10,000 sq.x. xxxxx (that is to
say, including service areas) which contain a country club-sports center
building in an area of about 7,500 sq.x. xxxxx (hereinafter: “the Sports Center”), and
a school building in an area of approximately 2,500 sq.x. xxxxx
(hereinafter: “the
School”). It is clarified that the planning of the
Public Buildings, to an overall extent of approximately 10,000 sq.x. xxxxx
as aforesaid, will in the future make it possible to take full advantage
of the building rights on Plot No. 8 for purposes of erecting a cultural
building as described in sub-clause 7.1.4.
below.
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It is
agreed that the Municipality will be responsible for the maintenance and
management of the Sports Center and the School, and accordingly the Municipality
will not be liable for any payment to the Purchaser and/or to any other entity
in respect of the management and maintenance of the Sports Center and the
School, including payment of management fees, maintenance charges, operating
charges and any other payment including payments of any sort in respect of the
use of the areas and the facilities which are common to the Public Buildings and
the Purchaser’s Project and all in respect of use of the Purchaser’s Lands for
purposes of thoroughfare and/or access to the area of the Public
Buildings.
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7.1.1.2
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Construction
of the built areas on Plot No. 1 (as defined in Plan TA/3001) to an
overall extent of approximately 2,430 sq.x. xxxxx (that is to say,
including service areas), as described in sub-paragraph 9.2.2 of Plan
TA/3001, for purposes of kindergartens, day-care centers and additional
public institutions at the suburban level as described in sub-paragraph
9.2.1 of Plan TA/3001) (hereinafter: “the Suburban Public
Institutions).
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The
Housing Company undertakes to erect the Suburban Public Institutions in a manner
that will ensure the independent and separate functioning of these public
institutions, including the systems and infrastructures that are connected
therewith, and will do so to whatever extent is possible and also taking into
account economic factors and as shall be agreed with the Company and the
Municipality in the scope of the detailed planning.
It is
agreed that the Municipality will be responsible for the maintenance and
management of the Suburban Public Institutions, and accordingly the Municipality
will not be liable for any payment of whatsoever nature to the Purchaser and/or
to the Management Company and/or to buyers of apartments and/or to the
representative committee of the condominium and/or to any other entity in
respect of the management and maintenance of these public institutions,
including payment of management fees, maintenance charges, operating charges and
any other payment, including payments of any sort in respect of the use of the
areas and facilities that are common to the Suburban Public Institutions and the
Purchaser’s Project and/or in respect of use of the Purchaser’s Lands for
purposes of thoroughfare and/or access to the Suburban Public
Institutions. The Purchaser undertakes to include a provision to that
effect in the sale contracts between it and third parties (including the sale
agreements with buyers of apartments).
37
It is
further agreed that the Suburban Public Institutions will be built and completed
in relation to and in the framework of the progress in the construction and
completion of the buildings which will house these public
institutions.
As
security for construction of the Suburban Public Institutions as described in
this clause, the Housing Company, or someone on its behalf, will lodge a
guarantee in an amount, at the time and on the conditions stipulated in Clause
25 of the Construction Contract.
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7.1.2
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With
regard to the erecting and constructing of the Public Buildings as stated
in sub-clause 7.1.1 above, including the Housing Company’s obligations in
connection therewith, the provisions of the Construction Contract (as
defined above) will apply as between the
parties.
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7.1.3
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Without
derogating from the contents of Clause 7.1.2 above, it is agreed that in
relation to the timetables for constructing the Sports Center and the
School, the Housing Company will act in the manner described below, with
it being clarified that in every case of a conflict and/or non-conformity
as between the timetables that are the subject of the Construction
Contract (including those set forth in sub-clause 7.1.3 below), and the
timetables that are the subject of this Agreement, the timetables that are
the subject of this Agreement shall take precedence and shall
prevail:
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7.1.3.1
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The
applications for the issue of excavation and shoring permits for the areas
on which the Sports Center and the School will be constructed shall be
lodged contemporaneously with the lodgment of the applications for the
issue of excavation and shoring permits for the areas on which the parking
and/or commercial areas in the confines of “the Kufsa”, as defined above,
will be built.
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7.1.3.2
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The
applications for the issue of the building permits for the Sports Center
and the School shall be lodged contemporaneously with the lodgment of the
applications for the issue of building permits (as distinct from
excavation and shoring permits) for the parking and/or commercial areas in
the confines of the Kufsa.
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7.1.3.3
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Initial
occupation of the parking and commercial areas in the confines of the
Kufsa shall be effected simultaneously and subject to the furnishing of
certificates of initial occupation for the Sports Center and the
School. It is hereby agreed that if the Purchaser requests to
make use of the parking and/or commercial areas in the confines of the
Kufsa before a certificate for initial occupation of the Sports Center and
the School has been furnished, the Purchaser will be entitled to address
an appropriate application to the Director of the Property Division as the
Municipality. The Director of the Property Division of the
Municipality will decide whether it is possible to accede to the
Purchaser’s request and under what conditions the Municipality is prepared
to allow use of the parking and/or commercial areas in the Kufsa prior to
production of the certificate for initial occupation of the Sports Center
and the School.
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38
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7.1.3.4
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As
security for construction of the Sports Center and the School as described
in this clause, the Housing Company or someone on its behalf shall lodge a
guarantee in such amount, at such time and on such conditions as are
specified in Clause 25 of the Construction
Contract.
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7.1.3.5
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The
Municipality for its part will perform all the necessary actions
(including its relating to and examining the plans and documents that will
be submitted to it by the Purchaser) and will sign all the necessary
documents in connection with the applications for the building permits for
the Public Buildings, in a manner that will not delay the issue of the
building permits for the commercial and parking areas in the Kufsa by
virtue of delays that are dependent on the Municipality, and subject to
the condition that the Purchaser has fulfilled all the lawful requirements
laid down by the competent planning authorities, the provisions of the law
and the provisions of the Construction
Contract.
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7.1.3.6
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The
Purchaser (including the Mall Company) hereby confirms that it is aware of
the provisions of the Construction Contract and same are known to it,
including the timetables specified in the Construction
Contract. Included in this the Purchaser (including the Mall
Company) confirms and agrees to the contingent connection that has been
stipulated in the Construction Contract and in this Agreement above
between the planning, construction, completion and initial occupation of
the commercial and parking areas in the Kufsa, on the one hand, and the
planning, construction, completion and initial occupation of the School
and the Sports Center, on the other. In addition the Purchaser
(including the Mall Company) agrees that the timetable for constructing
the Public Buildings as described in the Construction Contract and/or in
this Agreement shall be recorded as conditions in the building permits for
the parking and/or commercial areas in the Kufsa, and that it waives any
allegation and/or demand as against the Municipality and/or the Company
and/or anyone on their behalf, in regard to the contingent connection and
the conditions in the building permit as
aforesaid.
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7.1.4
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It
is agreed that the remainder of the areas for public purposes on Xxxx Xx.
0, to an extent of about 6,000 sq.m. (in addition to the areas specified
in sub-clause 7.1.1 above) will be zoned for and will serve as a high
quality and significant cultural building. It shall be the
Municipality which shall erect the aforesaid cultural building out of its
own resources. Timetables for planning and construction of the
aforesaid cultural building will bear a direct relationship to the
development and the actual construction of the “Kufsa”, with it being
agreed that works for erecting the aforesaid cultural building shall not
interfere with the works for the erecting by the Purchaser of the Public
Buildings.
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39
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7.1.5
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It
is further agreed in relation to the Public Buildings that the Company and
the Municipality shall bear the costs of constructing same in a manner
whereby the Company will pay the Housing Company and will be directly
liable to it for 75.84% of “the costs of erecting the
Public Buildings” (as defined below), and the Municipality will pay
the Housing Company and will be directly liable to it for 24.16% of “the costs of erecting the
Public Building” (as defined
below). For the avoidance of doubt it is clarified that the
obligations of the Municipality and the Company to bear the aforesaid
costs applies only in relation to the Public Buildings as defined
above.
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For
purposes of this sub-clause 7.1.5 “costs of erecting the Public
Building” means – the specific costs (including the increment to the
costs that will be added in respect thereof, if so specified in Appendix
C1 of the Construction Contract) as specified in the aforesaid Appendix
C1, provided that the amounts of the components of the costs have been approved
in advance and in writing by the Company and the Municipality, through the
Administration as defined in Appendix 4.1.4 to this Agreement (hereinbefore and
hereinafter: “the
Administration”).
In
relation to payment of fees and levies as particularized in Appendix C to the
Construction Contract, the Municipality may elect to make payment thereof
directly to the local committee and to the Municipality and not through the
Housing Company.
The
Housing Company undertakes that all the contractual arrangements between it and
the designers and executing contractors in connection with the planning and
construction of the Public Buildings will be done on a basis of tenders which
the Housing Company will conduct, in full transparency vis-à-vis the
Administration. The Housing Company further undertakes that
construction of the Public Buildings will be managed by it as a separate and
independent project from the Purchaser’s Project, and a separate bookkeeping and
accounting system will be maintained in respect thereof, and it is agreed that
the costs of erecting the Public Buildings will include only direct and specific
costs of erecting the Public Buildings without a loading of costs connected with
other parts of the Purchaser’s Project.
It is
agreed that under no circumstances shall the costs of erecting the Public
Buildings exceed an aggregate sum of NIS 97,706,667 including V.A.T.
(hereinafter in this sub-clause: “the Limit
Amount”). Notwithstanding the foregoing it is agreed that if
it should transpire that for purposes of meeting the obligation to erect the
Public Buildings in accordance with the technical specifications that were
attached to the Construction Contract, the “Costs of erecting the Public
Buildings” (as defined below) are expected to exceed the Limit Amount, then the
Housing Company will refer to the Company and to the Municipality, through the
Administration, in order for it to examine whether a deviation from the Limit
Amount is indeed necessary. If such deviation has been approved by
the Company and the Municipality through the Administration, then the amount of
the approved deviation will be added to the Limit Amount, with it being hereby
agreed that, in any event, the overall amount of the Costs of erecting the
Public Buildings which the Company and the Municipality will bear (each
according to its pro
rata share) will under no circumstances exceed a sum of NIS 102,333,333
plus V.A.T. as prescribed by law (hereinafter: “the Maximum Limit
Amount”). If the Costs of erecting the Public Buildings should
in practice be more than the Maximum Limit Amount, the Housing Company will on
its account, bear any amount which exceeds the Maximum Limit
Amount. It is agreed that the Limit Amount as well as the Maximum
Limit Amount will be linked to the Building Inputs Index commencing from the
date of signing of this Agreement and up to the time each payment is actually
made.
40
It is
further agreed that the Administration’s examination as aforesaid shall be
performed in a manner and at a time that does not cause a delay in the planning
and execution of the construction of the Public Buildings in relation to the
timetables stipulated in the Construction Contract and in this
Agreement.
The
Municipality’s share in the Costs of erecting the Public Buildings in accordance
with the provisions of this sub-clause above shall be paid on the basis of
current month + 45 days from the date on which each account for payment as
delivered to the Company and to the Municipality through the Administration, and
subject to the condition that the account has been approved for payment by the
Administration. V.A.T. as prescribed by law shall be added to each
payment against a valid tax invoice.
In every
case of an engineering dispute between the parties in relation to the Costs of
erecting the Public Buildings, except in regard to (1) approval of a deviation
from the Limit Amount as defined above; (2) in regard to the obligations of the
Company and the Municipality to bear the aforesaid costs; and (3) the maximum
amounts that will apply to the Municipality and the Company and the conditions
specified above in connection therewith – the dispute shall be referred for the
decision of a civil engineer who shall be appointed with the consent of the
Company, the Municipality and the Housing Company, and in the event of there
being no agreement between them, the engineer will be appointed by the chairman
of the Society of Architects and Engineers (hereinafter – “the Engineering
Arbiter”). The Engineering Arbiter shall act as an expert and
not as an arbitrator and his decision shall be final and binding on the
parties. It is clarified that all the provisions of this sub-clause
7.1.5 are intended to add to the provisions of the Construction Contract, where
in any event the liability of the Municipality and of the Company for payment of
the Costs of erecting of the Public Buildings shall be restricted to the Limit
Amount and to the Maximum Limit Amount (as defined above),
respectively.
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7.1.6
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It
is further agreed that in the framework of the planning and construction
on Xxxx Xx. 0, the construction of the ancillary commercial areas and the
additional parking areas, as defined in sub-clause 1.6 (b) above, shall be
planned in a manner that will allow for proper access to the public
functions on Plot No. 8. In addition the Mall Company
undertakes to operate the additional parking areas as part of the public
parking garage that supports the commercial and the public areas that will
be constructed on the Project Lands, and without same being linked to a
unit or to units that will be erected on the Project
Lands.
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For the
removal of doubt it is clarified that the Mall Company is the party that will be
exclusively entitled to all the proceeds of any sort arising from the operation
of the additional parking areas, and it is the party that shall bear all the
expenses connected with the operation and/or maintenance thereof (without this
derogating from the contents of sub-clause 7.2.2 below).
41
With
respect to the remainder of the commercial areas on Plot No. 8 which are not
included in the framework of the Additional Real Estate Rights, the Municipality
undertakes that in a case in which, in its sole and absolute discretion, it is
considering the leasing under leasehold and/or the letting to third parties of
such remainder of the commercial areas, then subject to the laws that apply to
the Municipality and to approval from the competent Municipality institutions
and from the Minister of the Interior, the Mall Company will be the party that
is invited first for negotiations regarding a sale as aforesaid. It
is further agreed that the businesses that will be conducted in the aforesaid
areas will be ancillary to the activities of the Public Buildings as stated in
Plan TA3001. In addition, it is agreed that in any event it will not
be possible to locate these areas in the framework of the commercial areas that
will be constructed on Parcel 93 or any other parcel that may be created in its
place as a result of registration of the parcellation, but shall be located in
the framework of the Public Buildings themselves.
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7.2
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Areas of
Municipality’s parking
places:
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7.2.1
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The
Mall Company shall construct 300 parking places in the confines of Plot
No. 8, containing 215 parking places under leasehold to it as stated in
sub-clause 1.6(b)(2) above and 85 parking places for the Municipality, as
described in sub-clause 7.2.2
below.
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7.2.2
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The
Mall Company undertakes to build and erect 85 specific and permanent built
parking places on Plot No. 8, in the area of the Municipality’s parking
places (as defined below), and to deliver same for the sole use of the
Municipality, without consideration of any sort, including entrance fees,
management fees, maintenance charges, operating charges and any other
payment, including payments of any sort in respect of the use of areas and
facilities that are common to the area of the Municipality’s parking
places and the Project parking places and/or in respect of the use of the
Purchaser’s Lands for purposes of access to the area of the Municipality’s
parking places, with it being agreed that the Municipality will attend to
and concern itself with the maintenance and management of these parking
places.
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7.2.3
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The
Mall Company is aware and agrees thereto that the basic positioning of 85
parking places as referred to in sub-clause 7.2.2 above will be according
to the location marked in xxxxx on the diagram attached to this Agreement
as Appendix B (hereinbefore and hereinafter: “Area of the Municipality
Parking Places”), and the final positioning of these parking places
will be determined as far as possible in continuity with and adjacent to
the entrance to the Sports Center that will be erected by the Purchaser as
stated in sub-clause 7.1.1.1 above, taking into account the overall
planning of Plot No. 8.
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42
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7.2.4
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In
addition to the contents of sub-clauses 7.2.1-7.2.3 above, it is agreed
that the Mall Company will construct additional parking places in excess
of the contents of this sub-clause 7.2 above on the fifth basement level
(-5) on Plot No. 8, in the maximum quantity permitted pursuant to Plan
TA/3001, and provided that against the exercise of the Purchaser’s right
to these additional parking places (if they are approved by the competent
planning authorities), the Mall Company will make over 40 parking places
for the exclusive use of the Municipality (over and above the 85 parking
places mentioned in sub-clause 7.2.2 above) free of any consideration,
including entrance fees, management fees, maintenance charges, operating
fees and any other payments, including payments of any sort in respect of
the use of the areas and facilities that are common to the Area of the
Municipality Parking Places and the Project Parking Places and/or in
respect of the use of the Purchaser’s Lands for purposes of access to the
Area of the Municipality Parking Places or the area of such parking
places, with it being agreed that the Municipality shall attend to the
maintenance and management of these parking places. The
location of the 40 parking places that will be made over to the
Municipality as aforesaid will be fixed as far as possible adjacent to and
as a continuation of the entrance to the Sports Center that will be
erected by the Purchaser as stated in sub-clause 7.1.1.1 above, all having
regard to the overall planning of Plot No. 8, with it being agreed that
the lands of these parking places will not be leased under leasehold to
the Purchaser and will not form part of the Additional Real Estate Rights
as defined in this Agreement, and will be deemed to be an integral part of
the Area of the Municipality Parking Places as defined
above.
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7.2.5
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It
is agreed and clarified that if the number of parking places that will
actually be constructed by the Purchaser in the confines of Plot No. 8 on
the first basement floors (-1) up to and including the fourth basement
floor (-4), should exceed 300 parking places as mentioned in sub-clause
7.2.1 above, then the additional parking places in excess of the aforesaid
300 parking places, will be the sole property of the Municipality, and an
accounting shall be done between the Municipality and the Purchaser in
connection with these additional parking
places.
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7.2.6
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The
Mall Company undertakes that persons who will come to the Sports Center,
that will be erected by the Housing Company as described in Clause 7.1.1.1
above, will be given a discount of fifty per cent (50%) of the parking
charges, with it being agreed that under no circumstances will the
aforesaid discount be given in relation to the remaining two hundred and
fifteen (215) parking places
simultaneously.
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7.3
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Development of open
public areas and maintenance
thereof
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7.3.1
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Without
derogating from the contents of sub-clause 1.7 above, and in addition
thereto, the Housing Company undertakes to develop and erect open public
areas (which are marked in green on the Leasehold Drawings and which – as
stated in Clause 1.6(d) above – are not part of the Property Sold and will
remain in the sole ownership and possession of the Municipality)
(hereinbefore and hereinafter: “the Open Public
Areas”), and shall do so on its account and at its sole expense, in
accordance with the provisions of Paragraph 9.6 of Plan
TA/3001. The Housing Company further undertakes that the
current maintenance of the Open Public Areas will be performed through a
management company on its behalf or on behalf of the residents of the
buildings that will be erected by the Purchaser or on behalf of the
representative committee of the condominiums (hereinafter: “the Management
Company”), with such maintenance being at its expense or at the
expense of the Management Company, at an appropriate standard and
according to the customary standard for open public areas of this
sort. It is agreed that any transaction or transactions that
may be made from time to time, if made, in the Remainder of the Project
Lands shall include provisions that shall bind the buyer/s of the
Remainder of the Project Lands or any part thereof, to bear their pro rata share of the
cost and maintenance of the Open Public Areas, which shall be the same
ratio as the ratio between the building rights (main areas) of each owner
of rights who has acquired rights from the Municipality and the Company as
against all the building rights (main areas) in the Project
Lands.
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43
It is
further agreed that the Municipality will not be liable (as distinct from the
buyers of rights from the Municipality in the Remainder of the Project Lands who
will be liable) for payment of any sort to the Purchaser and/or to the
Management Company and/or to the buyers of apartments and/or to the
representative committee of the condominiums and/or to any other body in respect
of the management and maintenance of the Open Public Areas, including payment of
management fees, maintenance fees, operational charges and any other
payment. The Purchaser undertakes that it will include such a
provision in the sale contract between it and third parties (including the sale
agreements with buyers of apartments).
In a case
in which maintenance of the Open Public Areas is not performed in the manner
described above, the Municipality will be entitled (but not obliged), after the
giving of 45 days prior written warning and an opportunity to rectify the
breach, to perform the maintenance of the Open Public Areas itself and to charge
the Housing Company or the Management Company or the house committee or the
representative committee of the condominiums (and if such representative
committee has not been established, then the residents) at the tariffs
prevailing for the time being in accordance with the actual results of the
Municipality’s tenders for the maintenance of open public areas of a similar
type to the aforesaid Open Public Areas. It is clarified that nothing
in the provisions of this sub-clause 7.3.1 shall derogate from the provisions of
sub-clause 9.8.1 below.
It is
clarified that where the Housing Company has established the Management Company,
as defined above, and has held the buyers of apartments (alone or together with
the occupants of the commercial areas) liable to bear their pro rata share of the cost of
maintenance of the Open Public Areas as aforesaid, the Housing Company will no
longer be liable to the Municipality in connection with the maintenance of the
Open Public Areas.
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7.3.2
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Without
derogating from the contents of Clause 16 below, it is agreed that the
Housing Company will be entitled to transfer its obligations for erecting
the Open Public Areas and for establishing a management company for
purposes of maintenance of the Open Public Areas to a transferee who
acquires rights from the Housing Company in the residential section, to
the extent that such transfer of rights has been approved in accordance
with the provisions of Clause 16
below.
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Where the
Housing Company has transferred its obligations in the manner stated above in
this sub-clause 7.3.2, the provisions of sub-clause 7.3.1 above shall apply to
the transferee.
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7.3.3
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If
the Housing Company has requested to effect a transfer of its obligations
in connection with the Open Public Areas which is not in accordance with
the provisions of sub-clause 7.3.2 above, then such transfer shall require
the prior written consent of the Municipality, which shall not
unreasonably withhold such consent. It is clarified that the
only factor the Municipality shall be entitled to consider for purposes of
giving consent as aforesaid and the conditions thereof is the guaranteeing
of construction and maintenance of the Open Public Areas and the setting
up of a management company as described
above.
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7.3.4
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It
is agreed that the provisions of sub-clauses 7.3.2-7.3.3 above shall also
apply in relation to any transferee who may acquire any rights in the
Project Lands from the Purchaser and/or from the Purchaser’s
transferees.
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7.3.5
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Nothing
contained in sub-clauses 7.3.2-7.3.4 above shall derogate from the
provisions of Plan TA/3001.
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7.4
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Open
private area
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Without
derogating from the Purchaser’s obligations as set forth in sub-clause 1.7
above, and in addition thereto the Purchaser undertakes, in relation to the
Company’s Lands and to the Municipality Lands, to comply with the provisions of
Plan TA/3001 in relation to the open private areas as described in sub-paragraph
9.6 of Plan TA/3001 and as shall actually be built in accordance with the
Amended Architectural Design Plan referred to in sub-clause 4.17 above, with it
being agreed that in the scope of the examination by the Administration of the
Amended Architectural Design Plan the division of the open private areas as
between the Company’s Lands and the Municipality Lands and the Remainder of the
Project Lands shall, inter
alia, be examined. The Purchaser further undertakes to bear
the expenses for maintaining the open private areas that will be erected by it
in the Purchaser’s Project. It is clarified that in a case in which
the Purchaser has established the Management Company, as defined above, and has
charged the buyers of apartments (alone or together with the occupiers of the
commercial areas) to bear the costs of maintenance of the open private areas
that will be constructed by it in the Purchaser’s Project, the Purchaser will no
longer be liable to the Municipality in connection with the maintenance of the
open private areas.
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8.
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Traffic solution –
Paragraph 14.7 of Plan
TA/3001
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It is
agreed that in the scope of performing the accounting between the Municipality
and the Company, implementing of the traffic solution for purposes of Paragraph
14.7 of Plan TA/3001 has been guaranteed by the Company, in its own name and on
behalf of the Purchaser and/or any future applicant for a permit. The
Municipality has undertaken that in a case in which the local committee does not
consider the performing of an accounting as aforesaid a performance guarantee
that complies with the conditions of Paragraph 14.7 of Plan TA/3001, the
Municipality will take steps, which will not be on the Purchaser’s account and
not on the account of a future applicant for a permit, to comply with the
conditions that are demanded by the Local Committee for purposes of fulfilling
the contents of sub-paragraph 14.7 of Plan TA/3001, all in a manner that does
not delay the issue of the building permit.
The
Purchaser and/or any future applicant for a permit shall support a reasonable
traffic solution that will be proposed by the Municipality and/or the Local
Planning and Building Committee, will not object to such solution, and will not
have any allegation and/or demand and/or claim, including for compensation,
against the Municipality and/or against the Local Planning and Building
Committee, in connection with such solution.
45
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9.
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Registration
of leasehold, easements and tax certificates:
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9.1
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Copies
of Land Appreciation Tax and Sales Tax certificates from the Land Registry
for purposes of registering the leasehold rights in the Company’s Lands in
the name of the Company are attached to this Agreement as Appendix
9.1. Subject to and against payment of the second
payment of the consideration as mentioned in Clause 6 above, the
Municipality undertakes to furnish the Purchaser with the following
certificates: (1) an approval from the Municipality and the local
committee (in respect of the period up to the date of delivery of the
right of use) for purposes of registration in the name of the Purchaser in
the Land Registry of the leasehold rights from the Municipality in respect
of the Municipality Lands and in respect of the Additional Real Estate
Rights (hereinafter: “the
Municipality Approval”), with it being clarified and agreed that
upon the first delivery of the Municipality approval at the date of actual
settlement of the Second Payment, the Municipality will have complied with
its full obligations in connection with the furnishing of the
approval. In the event that an extension or update is required
of the Municipality Approval, and/or in a case in which, for purposes of
obtaining the Municipality Approval at a deferred date, the making of
payments to the authorities mentioned in this sub-clause is required, the
responsibility will be imposed on the Purchaser and at its
expense.
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It is
further agreed that if for purposes of furnishing the Municipality Approval, it
is necessary that a payment for which the Purchaser is liable, in accordance
with the provisions of Clause 11 below, be made, then the Purchaser undertakes
to pay this amount forthwith in such a way as to facilitate the issue of the
approval. If the Purchaser does not pay the payment for which it is
responsible as aforesaid in order for such Municipality Approval to be issued,
then subject to the making of the payments that are imposed on the Municipality
according to Clause 11 below (to the Purchaser or to the relevant authorities,
at the election of the Municipality), the Municipality will be exempt from
furnishing the aforesaid Municipality Approval; (2) a Land Appreciation Tax and
a Sales Tax certificate (if any) from the Land Taxation Authorities in
connection with the transaction that is the subject of this
Agreement.
In
addition, the Municipality shall, up to the date on which the Second Payment is
made, furnish the Purchaser with a certificate from the Property Tax
authorities, if property tax applies, regarding the fact that the Municipality
has no debt for property tax, for purposes of the registration in the name of
the Purchaser, in the Land Registry, of the leasehold rights in the Municipality
Lands and in the Additional Real Estate Rights.
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9.2
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At
the Purchaser’s request, and after payment of the full Basic
Consideration, the Municipality will sign applications, forms,
declarations, deeds of leasehold, and the remaining documents that may be
required for purposes of preparing registration files in respect of the
right of leasehold, in respect of the Municipality Lands and in respect of
the Additional Real Estate Rights in the name of the Purchaser, in the
Land Registry. The parties to this Agreement undertake to
appear at the office of the competent Registrar of Lands and before the
Registrar of Cooperative Houses and before an attorney who authenticates
transactions, and to execute registration in the name of the Purchaser of
the leasehold over the Municipality Lands and over the Additional Real
Estate Rights, and to the extent necessary the Municipality will sign the
documents required for purposes of registering the right of leasehold as
aforesaid, provided that the Purchaser has fulfilled its obligations under
this Agreement. It is further agreed that at the time of
signing of this Agreement, the text of a document of the special
conditions for the leasehold (Appendix 1.6 to this Agreement) is being
signed by the parties for purposes of it being attached as an appendix to
this Agreement, on a basis that after payment of the full Basic
Consideration to the Municipality and the Company, the Municipality and
the Purchaser will sign the special conditions document, both in relation
to the Municipality Lands and to the Additional Real Estate Rights, and
also in relation to the Company’s Lands as stated in sub-clause 9.5 of the
Company’s Lands Agreement.
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9.3
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Upon
delivery by the Municipality of the certificates described in sub-clause
9.1 above, and upon the Municipality signing the documents at the
Purchaser’s request in the framework specified in sub-clause 9.2 above,
the Municipality will be deemed to have fulfilled its full obligations in
connection with registration of the leasehold rights in respect of the
Municipality Lands and in respect of the Additional Real Estate Rights in
the name of the Purchaser. It is clarified that all the
expenses in respect of registration of such rights shall be borne and paid
by the Purchaser.
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9.4
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The
Purchaser hereby undertakes to perform registration of the leasehold
rights in the Municipality Lands and in the Additional Real Estate Rights
in its name, in the Land Registry, at the earliest possible time, and
included in this the Purchaser undertakes to prepare the registration file
and the documents required for purposes of executing the registration and
to procure all the certificates and approvals that it is responsible for
obtaining for purposes of executing the registration, and to prepare the
Transfer Documents (deeds, applications and similar other documents) until
registration of the aforesaid rights has been effected in the name of the
Purchaser in the Land Registry.
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The
Purchaser undertakes to act in a such a manner that registration of the
leasehold rights in the Municipality Lands and in the Additional Real Estate
Rights in its name as stated in this sub-clause 9.4 will be completed within a
period of three (3) years from the date on which the Municipality Approvals
mentioned in sub-clauses 9.1 above have been received by the Purchaser, provided
that up to such time the parcellation has been registered. It is
agreed that if registration of the rights is not completed within three years as
aforesaid for reasons which are not dependent on the Purchaser, then the period
for completing registration of such rights will be extended by an additional six
(6) months.
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9.5
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It
is hereby clarified that until the time of transfer of the First Payment
Moneys from the Trustee to the Municipality, the Purchaser undertakes not
to register and/or to cause registration of a caveat in its favor
over the Municipality Lands and the Additional Real Estate Rights or part
thereof. Without derogating from the Purchaser’s undertaking as
set forth above in this sub-clause, at the time the Purchaser signs this
Agreement the Purchaser will sign an irrevocable power of attorney in the
text attached to this Agreement as Appendix 9.5, empowering Advocates Uzi
Salman and/or Xxxx Xxxxx and/or Orna Aharak-Perlok and/or Xxxx Liuvin
and/or any attorney of the legal services department at the Municipality,
to expunge any caveat that may be
registered, if registered, in favor of the Purchaser over the Municipality
Lands and the Additional Real Estate Rights and/or part
thereof. The appointed attorneys will be entitled to use the
power of attorney and to expunge any such caveat in each of the
cases mentioned below after having given the Purchaser prior written
notice of 14 business days: (1) in every case in which such caveat is registered in
the name of the Purchaser or anyone on its behalf contrary to the
provisions of this sub-clause 9.5; (2) in any event in which this
Agreement is lawfully cancelled for any reason, including, and without
derogating from the generality of the foregoing, in the case of
non-payments of the Consideration, or any part thereof (subject to the
provisions of sub-clause 18.8 below) by the Purchaser to the Municipality
at the times specified in Clause 6 above. For the removal of
doubt and without derogating from any of the Municipality’s rights
according to any law and agreement, the Purchaser declares and confirms
that cancellation of the Agreement in the circumstances described in
sub-clauses 5.2.4.3.1 and 5.2.4.3.4 above will be deemed to be lawful
cancellation of this Agreement. The aforesaid power of attorney
will be returned to the Purchaser in accordance with the provisions of
Clause 6 above. For the avoidance of doubt it is clarified that
registration of a caveat in favor of the
Purchaser as described in this sub-clause 9.5 shall not have the effect of
preventing and/or limiting the Municipality from registering caveats in connection
with the Remainder of the Project
Lands.
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In
addition, the Purchaser shall, at the time of signing of this Agreement, deliver
a power of attorney to the Municipality to perform all the registrations
required in connection with the Project Lands, including, and without derogating
from the generality of the foregoing, registration of the parcellation,
registration of easements, registration of caveats and/or encumbrances
and/or rights in the Remainder of the Project Lands, specific attribution of the
caveat/s that will be
registered in favor of the Purchaser over the Municipality Lands and in the
Additional Real Estate Rights and similar other registrations, in the text
attached to this Agreement as Appendix
9.5A. The Municipality will be entitled to endorse this power
of attorney to the buyers of rights in the Remainder of the Project Lands and/or
to their appointed attorneys. The Municipality undertakes to obtain a
power of attorney for special attribution of caveats from the buyers of
rights in the Remainder of the Project Lands in relation to caveats that will be
registered in their favor over the Remainder of the Project Lands.
It is
agreed that before any action being performed on the strength of the power of
attorney Appendix 9.5A in relation to the Company’s Lands and/or the
Municipality Lands and/or to the Additional Real Estate Rights, except
actions for registration of parcellation, registration of leasehold rights in
the name of the Company and special attribution of the caveats, prior written notice
of 14 days will be given to the Purchaser by the appointed attorney before the
such action is performed.
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9.6
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The
Purchaser undertakes that on its account and at its expense it will effect
registration of the easements in relation to the Municipality Lands and/or
to the Additional Real Estate Rights, and by way of registering easements
to guarantee right of way for vehicles and right of way for pedestrians
from Xxxx Xx. 0 xx Xxxx Xx. 0, all as described in the provisions of Plan
TA/3001, and the Municipality for it part undertakes that it will sign the
aforesaid deeds of easement.
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9.7
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The
Purchaser is aware that a map for purposes of registration and a diagram
for sub-division of the Land into a plot and/or plots within the confines
of the Project Lands in accordance with Plan TA/3001 have been approved
(hereinafter: “the
Parcellation”), and that the Company has undertaken in the
Company’s Lands Agreement to complete registration of the Parcellation of
the Company’s Lands together with the Municipality Lands in accordance
with the plan that has been approved as aforesaid, together with the
amendments thereto, or according to a new parcellation, and to register
the Parcellation of Parcel 92, all as described in the Company’s Lands
Agreement.
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9.8
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Registration
of condominium
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9.8.1
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The
Purchaser undertakes that on its account and at its expense it will
register the buildings that will be erected by it on the Company’s Lands
and the Municipality Lands as a condominium including registration of
house regulations, easements, rights of way, linkages and registration of
leasehold rights. If it is not possible to register the
condominium as a separate unit and the Purchaser is obliged to register it
as a complex condominium within the meaning thereof under the Land Law,
5729-1969, the Purchaser will act in accordance with the directives of the
Land Registry. All the documents pertaining to registration of
the building and/or the buildings as a condominium as aforesaid, including
a drawing, cooperative house registration order and house regulations will
be presented for the prior written approval of the Municipality before
same are lodged with the Land Registry or any other entity. The
Purchaser undertakes that as a precondition to the Municipality signing
the condominium documents the Purchaser will pay the Municipality a sum of
NIS 2,000 multiplied by the number of apartments that will be constructed
on the Municipality Lands, where this amount is linked to the Consumer
Price Index commencing from the date of signing of this Agreement and up
to the date of actual payment. In addition the Purchaser
undertakes to comply with other customary conditions as prevailing for the
time being, provided that they do not involve any additional monetary
obligation.
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It
is clarified that in relation to payment of handling fees in respect of
registration of a condominium, the provisions of this sub-clause take
precedence over the provisions of Paragraph 11(c) of Appendix
1.6.
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The
Purchaser undertakes to include in the house regulations of the
condominium a provision regarding the obligation of the residents to
establish a management 6company and for maintenance of the Open Public
Areas as described in Clause 7.3.1 above, and in regard to exempting the
Municipality from any payments as referred to in sub-clause
7.1.1.2.
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9.8.2
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Without
derogating from the contents of sub-clause 9.8.1 above, the Purchaser in
the name of the Municipality, undertakes to register, the lands of the
Suburban Public Institutions as defined in Clause 7.1.1.2, including the
outside areas that are linked thereto and the Open Public Areas, on its
account and at its expense and without consideration from the
Municipality, as a separate unit or as separate units in the framework of
registering a condominium. The contents of Clause 7.1.1.2 above
which pertain to management of the condominium will be included as a
provision in the house regulations of the
condominium.
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9.8.3
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The
Purchaser undertakes that registration of a condominium will be completed
at the earliest possible time it is able to do so and not later than
twenty-four (24) months from the date of receipt of a Certificate of
Completion for the last building that will be constructed on the Project
Lands, or within 24 months from the date of registration of the
appropriate Parcellation, whichever is the
later.
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9.8.4
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The
Purchaser undertakes that within the scope of transfer of rights in the
Project Lands, from the Purchaser to third parties (including buyers of
residential units), the Purchaser will arrange with the relevant
transferee or transferees in the contracts for the transfer of rights the
manner of performing registration of the Project Lands in the Land
Registry, including registration of house regulations for the condominium
in accordance with the foregoing, including by way of an undertaking by
each transferee to perform the necessary actions and to cooperate with all
the relevant entities for purposes of registering the areas that have been
transferred to him in the Land Registry, and including by way of receiving
suitable powers of attorney from such transferees, in order to facilitate
registration of the condominium on the Project Lands, at the times
specified in this Agreement.
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9.8.5
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It
is agreed that the provisions of sub-clause 9.8.4 above will also apply in
relation to any transferee who may acquire any rights in the Project Lands
from the Purchaser and/or from the Purchaser’s
transferees.
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9.9
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In
the event that the Purchaser does not perform the registrations described
in Clauses 9.4, 9.6 and 9.8 above, at the time specified in those clauses,
notwithstanding a demand from the Municipality to perform same, the
Municipality shall be entitled, but not obliged, to perform the aforesaid
acts of registration on the Purchaser’s account, after thirty (30) days
from the date of the demand.
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The
Purchaser undertakes to pay the Municipality, within ten (10) days from the date
of the Municipality’s demand, all the Municipality’s expenses in respect of the
registration, in accordance with an account that will be presented to
it. Expenses which are not paid on due date in accordance with the
demand shall bear indexation differences and interest from the date of the
demand and up to the date of actual payment. In addition, in such
case the Purchaser undertakes to furnish the Municipality with all the
certificates and approvals that are required for purposes of performing the
aforesaid registrations. For purposes of securing implementation of
the matters mentioned in Clauses 9.4, 9.6 and 9.8 above, the Purchaser will
grant the Municipality a power of attorney in the text attached to this
Agreement as Appendix
9.9. The Municipality will be entitled to make use of this
power of attorney, for performing the registrations itself, after having given
the Purchaser written notice of thirty (30) days.
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9.10
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Notwithstanding
the contents of this Clause 9 above, it is clarified that in a case in
which it is not possible to register a condominium on the Company’s Lands
together with the Municipality Lands, separately from the Remainder of the
Project Lands, the Purchaser will act in cooperation with the owners of
rights in the Remainder of the Project Lands as apply at such time, for
purposes of registering a complex condominium over all the Project Lands,
within the timetable specified in sub-clause 9.8.3 above. The
cost of performing such registration shall be borne by the Purchaser and
by the owners of rights in the Remainder of the Project Lands according to
their pro rata
share of the Project – that is to say according to the ratio between the
building rights (main areas) owned by all owners of rights who acquired
rights from the Municipality and the Company and the total building rights
(main areas) in that portion of the Project Lands which will be included
in the registration of the
condominium.
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10.
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Right of use and
delivery of possession
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10.1
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Within
2 business days from the date of actual transfer of the First Payment from
the Trustee to the Municipality, the parties will meet and will act in the
manner stated in sub-clause 10.2 below (hereinbefore and hereinafter:
“Date of Delivery of the
Right of Use”).
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10.2
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On
the Date of Delivery of the Right of Use, the parties will simultaneously
perform the following actions:
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10.2.1
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The
Municipality will deliver to the Purchaser a temporary right of use (which
is not a proprietary right) in the Municipality Lands in accordance with
the provisions of Clause 10.3 below and a temporary right of use (which is
not a proprietary right) in the area of the Open Public
Areas. It is further agreed that the Municipality will deliver
to the Purchaser a right of use in the Additional Real Estate Rights
within thirty days from the date the Director of the Property Division at
the Municipality is notified in writing that the Purchaser and/or any one
on its behalf intends to start excavation and shoring works on Plot No.
8. If according to the provisions of this Agreement it has not
been cancelled, such temporary right of use will remain in force up to the
date of delivery of possession.
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10.2.2
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The
Purchaser shall assume all the obligations which form part of the
Obligations and Commitments Transferred. For the removal of
doubt it is clarified that the rights which form part of the Obligations
and Commitments Transferred will be assigned to the Purchaser only from
the date of delivery of possession.
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10.2.3
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The
Purchaser shall deliver to the Municipality confirmation regarding the
existence of insurance policies as described in sub-clause 13.3
below.
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10.2.4
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The
Purchaser shall deliver to the Municipality a declaration verifying
representations in the text of Appendix 4.13 to this
Agreement.
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10.3
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The
right of use
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10.3.1
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The
right of use granted to the Purchaser on the Date of Delivery of the Right
of Use is a revocable right, for purposes of performing excavation and
shoring works and for that purpose alone. For the avoidance of
doubt it is clarified and emphasized that the permission granted to the
Purchaser as aforesaid does not constitute the grant of a proprietary
right to the Purchaser, possession to the Purchaser or a transfer of any
right to the Purchaser, apart from the permission to perform the
excavation and shoring works. The Purchaser will be a licensee
in respect of that portion of the Municipality Lands and/or the Additional
Real Estate Rights which the Purchaser uses for purposes of performing the
excavation and shoring works as a licensee only. The
Municipality will be entitled at any time, by way of prior written notice
of 14 business days to cancel the right of use, in any event in which the
Municipality believes in its sole and absolute discretion that the
Purchaser has breached any of its obligations under this Agreement and has
not rectified the breach within 14 business days from the date on which
written notice regarding the breach was received by
it.
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10.3.2
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The
Purchaser will have no right of lien over the Municipality Lands and/or
the Additional Real Estate Rights or any portion
thereof.
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10.3.3
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During
the period in which a right of use is granted to the Purchaser, the
Purchaser will be entitled to fence-in the Municipality Lands or any
portion thereof and/or to station a portable and temporary structure on
the Municipality Lands that will serve as a sales office, subject to
obtaining all the permits and approvals required according to law, all
without adding rights of way for the Purchaser in its capacity as a
licensee and without derogating from the powers and rights of the
Municipality and the Company with regard to the right of use
period.
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10.3.4
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Where
the Municipality has notified the Purchaser of cancellation of the right
of use as aforesaid and the Purchaser has not cured the breach within the
time specified in sub-clause 10.3.1 above, the Purchaser undertakes to
vacate the Municipality Lands and the Additional Real Estate Rights of any
person and/or article and/or temporary structure, and commencing from the
date on which the notice is given, the Municipality will be entitled to
evict the Purchaser and/or anyone on its behalf from the Municipality
Lands and the Additional Real Estate Rights and to evacuate any person and
article and/or temporary structure from the Municipality Lands and the
Additional Real Estate Rights, and to use all the materials, equipment and
installations the Purchaser and/or anyone on its behalf has left on the
Municipality Lands and/or the Additional Real Estate Rights. It
is further agreed that in a case in which, in addition to cancellation of
the right of use, the Municipality has cancelled this Agreement as a
consequence of such breach, all the works that were performed on the
Municipality Lands and the Additional Real Estate Rights up to that time
will be the sole property of the Municipality, without the Purchaser
having any allegation and/or claim and/or demand against the Municipality
in respect thereof, and the Purchaser undertakes to include an appropriate
clause in the contractual agreement with the executing contractors, as
defined below. In addition to all the foregoing and without
derogating therefrom, the Purchaser hereby empowers the Municipality to
take all the steps and measures required for purposes of realizing the
rights and powers of the Municipality under this Clause
10.3.3. For that purpose the Purchaser is lodging an
irrevocable notarial power of attorney in the text attached to this
Agreement as Appendix 10.3.4 with the Trustee at the time of signing of
this Agreement, which empowers the Municipality to take all the actions
required for purposes of evicting the Purchaser and/or anyone on its
behalf from the Municipality Lands and the Additional Real Estate Rights
and for purposes of realizing the Municipality’s rights under this Clause
10.3, including vacating the Municipality Lands and the Additional Real
Estate Rights of any person, article and temporary structure, use of all
the materials, equipment and installations which the Purchaser and/or
anyone on its behalf has left on the Municipality Lands and the Additional
Real Estate Rights, the giving of instructions and directives to the
executing contractors, the transfer into the Municipality’s ownership of
all the works that have been performed on the Municipality Lands and the
Additional Real Estate Rights up to that time, the giving of notices and
instructions and the signing of any document of whatsoever nature vis-à-vis third parties
and authorities in connection with the vacating of the Municipality Lands
and the Additional Real Estate Rights and/or the taking of any actions
with respect thereto, and so forth. In every case in which the
Municipality notifies the Trustee that the right of use has been cancelled
by it, the Trustee shall, after the giving of a warning notice to the
Purchaser of 14 business days in advance, transfer the power of attorney
to the Municipality, and the Municipality will be entitled to make use
thereof in its discretion for purposes of realizing its rights as
described above.
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The
Purchaser undertakes that the Municipality and/or anyone on its behalf will not
be responsible in any way for any damage of any sort that may be sustained by
the Purchaser, if such damage is sustained, by virtue actions connected with
evicting the Purchaser from the Municipality Lands and the Additional Real
Estate Rights and/or the evacuation of the equipment and the property from the
Municipality Lands and the Additional Real Estate Rights and the storing
thereof.
52
For the
removal of doubt it is emphasized that the Municipality will bear no
responsibility in respect of the property and the equipment which is removed and
it will not be deemed to be a bailee and/or a trustee in respect
thereof.
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10.3.5
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The
Purchaser undertakes that the Municipality and the Company will be a party
to any contractual arrangement between the Purchaser and executing
contractors who perform work for it on the Municipality Lands and/or the
Additional Real Estate Rights during the right of use period (hereinafter:
“the Executing
Contractors”), without this imposing on the Municipality and/or the
Company any liability and/or responsibility. In the scope of
any such contractual arrangement, an undertaking of the Executing
Contractors shall be included, directly as against the Municipality and
the Company, to the effect that in any event in which they receive a
notice from the Company and the Municipality and that the Company and the
Municipality have lawfully, in their discretion, cancelled the right of
use they have granted to the Purchaser, then as from the date of receipt
of the notice onwards, the Executing Contractors will act solely in
accordance with the instructions of the Municipality and the Company as
will be given at that time. The Municipality and the Company
will be entitled to elect whether to complete the works of the Executing
Contractors through the Executing Contractors or to evict them from the
Municipality Lands and the Additional Real Estate Rights without the
Municipality and/or the Company owing them any indebtedness of whatsoever
nature. The Purchaser undertakes to present for the prior
written approval of the Company and the Municipality the identity of the
Executing Contractors and the terms and conditions of the contractual
arrangement with them (including the text of the contractual
agreement).
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10.4
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Date
of delivery of possession
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10.4.1
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Simultaneous
with and against the making of the second payment, possession of the
Municipality Lands and the Additional Real Estate Rights will be delivered
to the Purchaser (hereinbefore and hereinafter: “Date of Delivery of
Possession”). With regard to the Open Public Areas
(namely: on the upper ground floor only and which are intended for an Open
Public Area, as marked in green on the Leasehold Drawings), the provisions
of sub-clause 1.6(d) above
will apply accordingly.
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10.4.2
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Without
derogating from the contents of Clause 10.2.2 above, on the Date of
Delivery of Possession, the parties will sign a deed of assignment of
Obligations and Commitments Transferred to the Purchaser, in the text
attached to this Agreement as Appendix
10.4.2. In addition, the Purchaser will deliver to the
Municipality a declaration verifying representations in the text of
Appendix 4.13 to this Agreement.
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10.4.3
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It
is clarified that at the Date of Delivery of Possession the Municipality’s
rights in the Municipality Lands are free and clear of any attachment
and/or encumbrance and/or mortgage and/or any third party right, save and
except caveats and/or mortgages and/or attachments and/or encumbrances
and/or any third party rights which have their origin in the Purchaser and
excluding caveats over an antiquities site, and in accordance with
leaseholds that have expired which are registered over Parcel 92 Block
7104 and which have not been expunged by the Municipality up to the Date
of Delivery of Possession. If attachments and/or mortgages
and/or third party rights and/or caveats are imposed on the Municipality’s
rights in the Municipality Lands where the origin for same does not lie
with the Purchaser (hereinafter: - “the Impediment”), then
the Municipality undertakes to remove such Impediment within 90 days from
the date the Municipality becomes aware of the
Impediment.
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11.
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Taxes
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11.1
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Land
Appreciation Tax and Sales Tax, if same apply, in respect of the sale by
the Municipality of the Property Sold to the Purchaser shall be borne by
the Municipality. It is hereby clarified that the Municipality
is entitled to embark on objection or appeal proceedings before any
relevant authority, in its discretion, against its being held liable for
any of the payments imposed on it according to this sub-clause
11.1.
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11.2
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Land
Acquisition Tax in respect of the purchase of the rights of leasehold in
respect of Municipality Lands and in respect of the Additional Real Estate
Rights shall be borne and paid by the
Purchaser.
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11.3
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All
taxes, rates, fees, levies, pursuant to any law, and all compulsory
payments of any sort pursuant to any law, as well as any payment which is
imposed on the Purchaser as a leasehold lessee in accordance with the
special conditions of leasehold (Appendix 1.6 to this Agreement) which
applied and/or which apply and existed or which may apply and come into
being in connection with the Municipality Lands and the Additional Real
Estate Rights, the cause of action for which pertains to any period,
whether before the date of signing of this Agreement or subsequent
thereto, shall be borne and paid by the Purchaser, except as stated in
sub-clause 11.5 below and unless otherwise expressly stipulated in this
Agreement. Notwithstanding the foregoing, payment of property
tax in respect of the Municipality Lands and the Additional Real Estate
Rights the grounds for which arose before the Date of Delivery of the
Right of Use and payments of the consumption of water and electricity in
respect of the Municipality Lands and the Additional Real Estate Rights,
the grounds for which preceded the Date of Delivery of the Right of Use,
will not apply to the Purchaser.
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11.4
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Without
derogating from the contents of sub-clauses 11.3 above, the Purchaser
undertakes to pay the Municipality the full betterment, in respect of any
change in the Plan TA/3001 (including an application for relief,
exceptional use, alteration of the approved plan and so forth) that may be
approved in relation to the Municipality Lands and/or the Additional Real
Estate Rights after the date of signing of this Agreement, with this being
in accordance with the provisions of the special conditions document for
the leasehold. Nothing in the foregoing shall derogate from the
provisions of sub-clause 6.3.5
above.
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11.5
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With
respect to a betterment levy – it is agreed that any liability for a
betterment levy in respect of the Municipality Lands and the Additional
Real Estate Rights, in relation to the full rights and the uses that are
approved and the full building capacity in accordance with the statutory
situation that is in force (up to and including Plan TA/3001), shall be
imposed on the Municipality and shall be arranged by it, and no liability
and/or responsibility in connection therewith will apply to the
Purchaser.
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In regard
to other payments to the Tel Aviv Municipality, including fees, taxes, rates,
development levies and other compulsory payments – such payments in respect of
the period up to April 15, 2010, shall be borne and paid by the
Municipality.
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11.6
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It
is agreed that each party will render to the tax authorities all the
reports it is obliged to render according to law and the time prescribed
for this by law.
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11.7
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If
the Municipality has paid development levies and/or payments for
connection up to electricity in respect of the Municipality Lands, and to
the extent that a right exists at law for setting off such development
levies against fees and levies that will be imposed on the Purchaser in
connection with the Purchaser’s Project and/or payments for connection up
to the Israel Electric Corporation, it is agreed that the Municipality (in
its capacity as a seller) does not object to the Purchaser setting off a
pro rata portion of such development levies and electricity connections
against the development levies and/or the connecting up payments to the
Electric Corporation which the Purchaser will be charged by the
Municipality. “Pro rata
share” in this sub-clause 11.7 means, the ratio between the
building rights (main areas) on the Municipality Lands and the
Municipality’s share in the total building rights (main areas) in the
Project Lands (save and except Plot No. 8). For the removal of
doubt it is clarified that nothing in the foregoing in this sub-clause
constitutes any form of representation and/or undertaking on the part of
the Company in connection with development levies and/or payments for
connecting up to electricity and/or in connection with the payment
thereof, the amount thereof and/or the right to set-offs in connection
therewith.
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11.8
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It
is hereby clarified that each of the parties is entitled to embark on
objection or appeal proceedings vis-à-vis any relevant authority, in such
party’s discretion, against the charging of any of the payments imposed on
such party in accordance with this Clause 11, provided that this shall not
have the effect of delaying the times specified in this
Agreement.
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12.
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Condition
precedent
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The
validity of this Agreement is contingent upon and conditional on receiving the
approval of the City Council (in furtherance of the approval given as stated in
sub-clause 3.2 above), for purposes of complying with the procedure under
Section 188 of the Ordinance, and the receipt of the final approval of the
Minister of the Interior in accordance with Section 188 of the Ordinance (in
furtherance of the approval in principle that was received as stated in
sub-clause 3.2 above). Shortly after the signing of this Agreement,
the Municipality shall take steps to obtain the approval of the City Council and
the approval of the Minister of the Interior, as mentioned in this Clause 12
above, in a manner that the aforesaid approvals will be received within 60 days
from the date of signing of this Agreement.
It is
clarified that if the condition precedent is not fulfilled within 60 days from
the date of signing of this Agreement, this Agreement and the Construction
Contract will be void, and the Trustee shall return the First Payment to the
Purchaser together with the fruits thereof, less the costs of opening the Trust
Account, the closing thereof and the performing of operations therein, and none
of the parties will have any claim and/or demand and/or allegation against
another in this regard, and the Purchaser will have no rights of any sort in the
Municipality Lands and/or in the Additional Real Estate Rights. It is
agreed that each party may, in its sole and absolute discretion, extend the time
for fulfillment of the condition precedent as mentioned in this Clause 12, for a
period of up to an additional 60 days, by way of written notice to the other
party.
55
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13.
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Liability,
waiver, and
indemnity
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13.1
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The
Purchaser hereby confirms and undertakes that it waives any claim, demand,
cause of action or allegation (hereinafter: “Claim”) of whatsoever
nature under any law and agreement as against the Municipality and/or the
Company and/or any of the bodies connected with either of them, in
connection with the subject matter of this Agreement and the actions of
any of the aforesaid entities in connection with the signing and
consummation of this Agreement.
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The
Purchaser hereby undertakes that if, notwithstanding the foregoing, a claim as
aforesaid is raised for which the Purchaser receives indemnification, the
Purchaser will be obliged to indemnify the Company and/or the Municipality
and/or the entities connected with them to the extent of the amount of the
aforesaid compensation which either the Municipality or the Company or the
entities connected with them have been ordered to pay. For the
removal of doubt it is clarified that nothing contained in this sub-clause 13.1
above shall release the Municipality from fulfilling its obligations pursuant to
this Agreement.
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13.2
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Without
derogating from the Purchaser’s obligations under this Agreement and/or
from its liability as described in this Agreement, any responsibility
and/or liability vis-à-vis any person and/or body, including as against
the various administrative authorities, in connection with the
Municipality Lands and/or in the Additional Real Estate Rights and/or the
Property Sold and/or the quality thereof and/or the use thereof and/or
acts and/or omissions therein and/or in connection therewith, the origin
and/or the cause of action for which and/or the facts that serve as the
basis for same pertain to the period subsequent to the Date of Delivery of
the Right of Use, shall be borne by the Purchaser alone, to the exclusion
of the Municipality’s liability. Included in this, the
Purchaser undertakes to indemnify the Municipality and/or the local
committee and/or the Company and/or any of the bodies connected with any
of them, in respect of any damage and/or expense of whatsoever nature that
may be incurred by any of them, and the responsibility for which is
imposed on the Purchaser in accordance with the provisions of this
sub-clause 13.2 above. For the removal of doubt it is clarified
that the provisions of this sub-clause 13.2 do not derogate from the
Purchaser’s liability and/or from its obligations in relation to periods
which preceded the Date of Delivery of Right of Use as set forth in any of
the provisions of this Agreement.
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13.3
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Without
derogating from the Purchaser’s liability according to law and/or this
Agreement, commencing from the Date of Delivery of the Right of Use and
throughout the entire period in which any works are performed by the
Purchaser and/or on its behalf on the Municipality Lands and/or on the
Additional Real Estate Rights, the Purchaser undertakes to effect and
maintain all the insurances at its expense which are necessary and
customary in projects of this sort, in appropriate amounts, including and
without derogating from the generality of the foregoing, building
contracting works insurance, third party liability insurance, employer’s
liability insurance and similar other insurances (hereinafter: “the
Insurances”). The Purchaser undertakes to pay the
insurance premiums on due date and to comply with all the remaining
provisions of the insurance policies in order that the insurances remain
in force. The Insurances, including all the chapters thereof,
will be extended to include the Municipality and the buyers of rights in
the Remaining Project Lands (as distinguished from the buyers of
residential units) as an additional insured, subject to a cross-liability
clause pursuant to which the insurance will be deemed to have been
effected separately for each of the individual parties who make up the
insured. All the insurance policies shall contain a provision
stating that the insurer will notify the Municipality in writing 30 days
in advance before it has the intention of cancelling or reducing the
policies. In the scope of the contractual arrangements between
the Municipality and buyers of rights in the Remaining Project Lands, the
Municipality will oblige the aforesaid buyers of rights to extend the
insurances which will be effected by them and to include the Purchaser as
an additional insured subject to a cross-liability clause. It
is agreed that receipt by the Municipality of confirmation that the
Insurances have been effected to the satisfaction of the Municipality
shall constitute a pre-condition to delivery of the right of use and
delivery of possession of the Municipality Lands and the Additional Real
Estate Rights to the Purchaser. Nothing contained in the
foregoing shall derogate from the Purchaser’s right to include the
financing bank as a beneficiary in the insurances and to charge and
encumber the insurance compensation that may be due to the Purchaser in
favor of the financing bank.
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14.
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Agreed
damages
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14.1
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It
is hereby agreed between the parties that in every case of a material
breach of this Agreement by the Purchaser, which is not the cured in
accordance with the provisions of sub-clause 18.6 below, including, and
without derogating from the generality of the foregoing, in the case of
actual non-payment of the consideration to the Municipality by the
Purchaser at the times specified in Clause 6 above, for any reason, or in
the case of a registration by the Purchaser of a caveat prior to the time
specified in sub-clause 9.5 above which was not expunged within 48 hours
from the time the Purchaser was called upon to expunge same, the
Municipality will be entitled, without derogating from any right or remedy
available to the Municipality according to any law and agreement in
respect of a breach of this Agreement by the Purchaser, to agreed damages
in the sum equivalent to 10% of the amount of the Basic Consideration
(hereinafter: “the Agreed
Damages”), as agreed pre-estimated liquidated damages in respect of
such material breach. It is hereby expressly agreed that in
such case the Municipality will have the absolute right to confiscate the
Agreed Damages, either by foreclosing on the sale process guarantee or by
holding forfeit the amounts which have been paid to it on account of the
consideration up to such time, without the necessity for giving a warning
notice or notice of any sort to the Purchaser and/or to the Interested
Parties.
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14.2
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The
Purchaser hereby declares that the aforesaid Agreed Damages as referred to
in sub-clause 14.1 above have been fixed by the parties after careful and
reflective assessment of the damage that will be incurred by the
Municipality as a result of such material breach, and accordingly no
argument by the Purchaser to the effect that the compensation is
unreasonable will be entertained, and the Purchaser hereby irrevocably,
fully and expressly waives any allegation or argument of any sort by
it. It is further agreed that the Municipality will have the
absolute right, for purposes of collecting the Agreed Damages, to
foreclose on the sale process guarantee or to hold forfeit the amounts
that have been paid to it on account of the Consideration up to such time
without being obliged to give notice to the Purchaser about the effecting
of such foreclosure.
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14.3
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It
is agreed that the provisions of this Clause 14 above are subject to the
provisions of sub-clause 5.2
above.
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15.
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Name
of the Project
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It is
hereby agreed and clarified that the Municipality will decide on the name of the
public areas precinct, the public buildings and the open public areas, and will
be entitled to place suitable signboards at such places, as is the customary
practice in the city of Tel Aviv-Jaffa, or as may be customary in the city of
Tel Aviv-Jaffa at such time.
It is
agreed that the Purchaser, the Municipality and the Company will, by agreement,
decide on the name/names of the Purchaser’s Project, in accordance with
professional advice which the Purchaser, the Municipality and the Company will
receive in relation thereto (hereinafter – “the Name of the
Project”). The Housing Company will be entitled to decide on
the name of the residential precinct (including the inclusion in this name of
the name of “Xxxxx”) and the Mall Company will be entitled to decide on the name
of the commercial areas in the Purchaser’s Project, while the Housing Company
and the Mall Company undertake that the names will be given by them as aforesaid
will, under all the circumstances, include the name of the Project as will be
decided as aforesaid. For example, if it is decided that the name of
the Project is: “New Tel Aviv”, then the Housing Company will be entitled to
call the residential precinct by the name of: “X” in New Tel Aviv” and the Mall
Company will be entitled to call the commercial areas by the name: “Y” in New
Tel Aviv”.
Nothing
in the foregoing shall derogate from the Municipality’s power and authority
and/or its duty as a local authority to decide on the name of the suburb in
which the Project will be included, in accordance with Section 235A of the
Municipalities Ordinance.
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16.
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Transfer
of rights and encumbrances
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16.1
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It
is hereby agreed that until completion of the construction of all the
built areas that can be erected on the Municipality Lands, the Company’s
Lands and the Additional Real Estate Rights (including the Public
Buildings) in accordance with the provisions of Plan TA/3001 and pursuant
to the provisions of this Agreement, the Purchaser will not be entitled to
transfer any of its rights and obligations in the Property Sold, or any
part thereof, to third parties (excluding a sale of residential units to
the buyers of apartments as defined above and/or the letting of
residential units and/or built commercial areas) (hereinafter for purposes
of this sub-clause: “the
Transferee”) without the prior written consent of the Company and
the Municipality.
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It is
clarified that such consent will not be unreasonably withheld by the
Municipality and the Company, including the physical and zoning condition of the
land that is the subject matter of the requested transfer at the requested time,
the extent of the areas the transfer of which is requested, the identity of the
Transferee, his financial strength and stability, the status of completion of
construction of the public buildings, the open public areas and the residential
and commercial areas, securing of payment of the full consideration to the
Municipality and the Company, the conditions of employment with the Transferee,
and so forth. It is further agreed that the Municipality and the
Company will be entitled to make their consent subject to conditions, including
the making of a payment to the Municipality and the Company and/or the bringing
forward of payment of that part of the consideration that remains unpaid at such
time, collateral security and so forth.
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16.2
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Notwithstanding
the contents of Clause 16.1 above and subject to what is stated in Clause
16.3 below, it is agreed that:
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58
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16.2.1
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Until
the date of payment of the full Basic Consideration, the Mall Company will
be entitled to sell portion of its rights and obligations in relation to
the commercial areas that are the subject of this Agreement to a third
party which is a financial entity and/or an entity whose field of business
is the management and operation of yield producing assets (hereinafter for
purposes of this sub-clause – “the Transferee”),
provided that the obligations of the Mall Company and the Transferee
vis-à-vis the Municipality and the Company in relation to the commercial
areas shall be joint and several, and that the provisions of sub-clause
16.5 below shall be complied
with.
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16.2.2
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Commencing
from the date of payment of the full Basic Consideration to the
Municipality and the Company, the Mall Company will be entitled to sell
the commercial areas or part thereof to any third party, provided that the
Transferee assumes the full obligations of the Mall Company in accordance
with this Agreement as regards the transferred portion of the commercial
areas, and the Mall Company shall remain liable to the Company for the
full obligations pursuant to this Agreement in connection with that
portion of the commercial areas which remains in its possession after the
transfer, if any, and that the provisions of sub-clause 16.5 below are
complied with.
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16.3
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If
the Mall Company should wish to sell its rights in the commercial areas
(in whole or in part) prior to the issue of a certificate for initial
occupation (Form 4) in respect of the School, the Sports Center and the
area of the Municipality’s parking places (hereinafter in this Clause 16:
“the School, the Sports
Center and the Municipality’s Parking Places Area”), then such
transfer shall be subject to the prior written consent of the Municipality
on such conditions as the Municipality may stipulate in accordance with
the provisions of this sub-clause below, and subject to fulfillment of the
provisions of sub-clause 16.5 below. This consent shall be
given if the Municipality has been persuaded that such transfer does not
affect the obligations of the Housing Company for erecting the School and
the Sports Center, the construction and actual completion thereof, and the
obligations of the Mall Company for constructing the Municipality’s
Parking Places Area, the construction and actual completion
thereof. It is clarified that the only factor the Municipality
will be entitled to take into account for purposes of giving such consent
and the conditions thereof, is the guaranteeing of construction of the
School, the Sports Center and the Municipality’s Parking Places
Area.
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16.4
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It
is agreed that in the case of the transfer of rights by the Purchaser in
accordance with the provisions of this Clause 16 above, the Municipality
will sign the necessary documents for purposes of transferring the
Purchaser’s rights to the Transferee (including consent to registration of
a caveat, amendment of the deeds of mortgage and so forth), provided that
within the framework of such documents the Municipality’s rights pursuant
to this Agreement will be secured and the Transferee’s stepping into the
Purchaser’s shoes vis-à-vis the Municipality in all respects shall be
guaranteed, all subject to the condition that the Municipality’s signing
as aforesaid shall not derogate from any of the Municipality’s rights
under this Agreement and/or have the effect of the imposing any
obligations and/or expenses on the Company which are not expressly imposed
on it in accordance with this Agreement. The Municipality’s
consent to a transfer of rights as aforesaid, to the extent that it is
given, will in any event be subject, inter alia, to the expunging of a
caveat that has been registered in favor of the individual party who makes
up the Purchaser who is the transferor or to an amendment thereof, as the
case may be, cancellation of the mortgage that was registered in favor of
the financing bank in connection with the individual party who makes up
the Purchaser who is the transferor or an amendment thereof, as the case
may be, the furnishing of all the powers of attorney required under this
Agreement, the Transferee signing the Transfer Documents that are demanded
by the Company and the Municipality, and similar other
documents.
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16.5
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It
is agreed that the provisions of this Clause 16 above (including all the
sub-clauses hereof) regarding restrictions on the transfer of rights will
also apply to a transfer of shares and/or an allotment of shares and/or
the grant of options for shares and/or any disposition or act, directly or
indirectly (hereinafter – “Operations in Shares”)
in the shares of any of the individual parties who make up the Purchaser
and/or in the shares of their parent companies (up to and not including
Interested Parties) (apart from a public offering of shares of such
companies, provided that there shall be no change in control in any of the
individual parties who make up the Purchaser or in any of their parent
companies), and Operations in Shares as a result of which there will be a
change in control (within the meaning of that term in the Securities Law,
5728-1968) in any of the Interested Parties, in a manner whereby any
Operation in Shares as referred to above in this sub-clause will require
the Company’s consent in accordance with the conditions of Clause 16
above.
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It is
hereby further agreed that a transfer of rights which is as a result of any of
the following events will not require the consent of the Municipality and the
Company: (1) realization by the financing company of the encumbrance to the
financing company, as defined below; (2) a dilution in the holdings
of one of the shareholders in the Housing Company or in the Mall Company at the
expense of an increase in the holdings of the other shareholder in the Housing
Company or in the Mall Company by virtue of the dilution clause in the agreement
of the individual parties who make up the Purchaser (which does not involve the
bringing in of an additional partner into the Housing Company or the Mall
Company), all subject to the condition that transfers as referred to above in
this paragraph will not have the effect of derogating from any of the
obligations under this Agreement of any of the individual parties who make up
the Purchaser.
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16.6
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The
encumbrances
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16.6.1
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Up
to the date of actual settlement of the Second Payment, the Purchaser will
not be entitled to encumber any of its rights pursuant to this Agreement
and/or in the Municipality Lands and the Additional Real Estate Rights in
favor of any third party.
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16.6.2
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Simultaneous
with settlement of the Second Payment, as defined above, the Purchaser
will be entitled to encumber its rights in the Municipality Lands and the
Additional Real Estate Rights and/or its rights pursuant to this
Agreement, solely in favor of a commercial bank that will provide it with
a loan for purposes of financing the transaction that is the subject
matter of this Agreement and/or realization of the transaction, but
subject to the following cumulative conditions (hereinafter – “the Financing Bank”, and
“the Construction
Loans”),
respectively):
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16.6.2.1
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The
monies of the Second Payment and the monies of the Third Payment shall be
paid by the Financing Bank directly to the Municipality in the manner and
at the times set forth in the provisions of sub-clause 6.2.5 above and
sub-clause 6.2.6 above.
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16.6.2.2
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In
the scope of the banking documents the Financing Bank shall confirm to the
Municipality in writing that it is aware, and it agrees thereto, that the
Municipality will, in its discretion, be entitled to create encumbrances
and third party rights of any sort in the Remaining Project Lands,
including encumbrances ranking pari passu with the
encumbrance in favor of the Financing
Bank.
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60
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16.6.2.3
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The
credit which is the subject of the Construction Loans shall be given
solely in connection with the Purchaser’s Project and the encumbrance to
the Financing Bank shall secure the obligations to the Financing Bank of
the Purchaser and the Interested Parties in connection with the
Purchaser’s Project only.
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16.6.2.4
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All
the expenses, the liability and the obligations in connection with the
construction loans, if same are provided to the Purchaser, including
commissions and costs in respect of the issue of any guarantees, including
Sale Law guarantees to buyers of apartments, shall be borne in their
entirety by the Purchaser, in a manner that there shall be no liability on
the Municipality in connection
therewith.
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16.6.2.5
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The
signature by the Municipality to the encumbrance documents to the
Financing Bank will be subject to the condition that the Municipality’s
liability and/or obligation in connection with receiving the Construction
Loans will be confined to the creating of an encumbrance in favor of the
Financing Bank as stated in Clause 16.6.3 below and to the Financing
Bank’s ability to realize same, to the extent necessary, without
additional obligations being imposed on the Municipality vis-à-vis the
Financing Bank and/or without the Financing Bank being able to have
recourse to the Municipality’s other assets (including its rights in the
Remaining Project Lands and/or in the land of Plot No.
8).
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16.6.2.6
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The
Financing Bank shall confirm in writing to the Municipality that
realization of the encumbrance in favor of the Financing Bank and its sale
of the rights to a third party pursuant to the aforesaid realization of
the encumbrance shall be made subject to the condition that such third
party shall step into the Purchaser’s shoes with respect to all the rights
and obligations according to the provisions of this Agreement and subject
to the Municipality’s rights pursuant to this Agreement, without this
derogating from the provisions of sub-clause 5.2.5
above.
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16.6.2.7
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The
Financing Bank shall give consent in writing to registration of the
parcellation, registration of a leasehold in favor of the Municipality
over the Municipality Lands and the Additional Real Estate Rights, to the
extent that the Municipality so desires, as well as registration of any
act required in the Remaining Project Lands and in the land of Plot No. 8,
provided that its rights pursuant to the encumbrance in its favor shall
not be adversely affected.
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16.6.3
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It
is agreed that the encumbrances that will be given by the Municipality in
favor of the Financing Bank will include only the encumbrances mentioned
below, with it being agreed that under all circumstances the encumbrance
documents shall conform with the provisions of Clause 16.6.2 above
(hereinafter – “the
Encumbrance in favor of the Financing
Bank”):
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61
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16.6.3.1
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Registration
of a mortgage over the Municipality’s rights of title in Parcel 92 (in
respect of which the provisions set forth at the end of this sub-clause
16.6.3.1 will apply), 93, 95 and 114 Block 7104, as same stand at the date
of signing of this Agreement (and if registration of the encumbrance in
favor of the bank is executed after registration of the parcellation, the
registration shall be carried out in relation to the Municipality’s rights
as same will be after registration of the parcellation), on a basis that
registration of the mortgage will, in any event, be effected in relation
only to the Municipality Lands, by way of registration of a mortgage
according to a diagram and in the alternative, if this is not possible, by
way of registering a mortgage over the above-mentioned parcels coupled
with the exclusion of: (1) the Company’s Lands and (2) the Remainder of
the Project Lands, from the applicability of the mortgage in a manner
which makes it possible to create first-ranking encumbrances in favor of
third parties over the Remainder of the Project Lands, all subject to the
provisions of Clause 16.6.3.3 below. Notwithstanding the
foregoing, if at the time of registration of the Encumbrance in favor of
the Financing Bank all the leaseholds which have expired have not been
expunged, then in relation to Parcel 92 only (or in relation to the new
parcel that will be created following the registration of the parcellation
and the origin for which is in Parcel 92) a deed of undertaking to
register a mortgage shall be given by the Municipality, pursuant to which
a caveat will be
registered in favor of the Financing Bank over Parcel 92 or over the new
parcel that is created following registration of parcellation as
aforesaid, with it being agreed that in such case no mortgage in favor of
the Financing Bank will be registered. Upon completion of the
expungement of the leaseholds which have expired, a mortgage will be
registered in favor of the bank over Parcel 92 in the format described
above.
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16.6.3.2
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After
registration of a leasehold in favor of the Municipality in connection
with the Municipality Lands, to the extent that same is registered, the
Encumbrance in favor of the Financing Bank will be registered by way of
registration of a mortgage over the Municipality’s rights of leasehold in
the Municipality Land. After registration of a leasehold in
favor of the Municipality in connection with the Additional Real Estate
Rights, if same is registered, and after completion of the expungement of
the leaseholds that have expired as stated in sub-clause 16.6.3.1 above,
the Encumbrance in favor of the Financing Bank will be registered by way
of registering a mortgage over the Municipality’s rights of leasehold in
the Additional Real Estate Rights.
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The
Purchaser undertakes to sign and to cause the Financing Bank to sign all the
documents required for purposes of performing the matters
aforesaid.
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16.6.3.3
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It
is hereby clarified and agreed that under all circumstances, the
Encumbrance in favor of the Financing Bank will be subject to the
Company’s rights in the Project Lands (both in the Company’s Lands as well
as in the Company’s share of the Remainder of the Project
Lands).
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16.6.3.4
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The
Purchaser undertakes to deliver to the Municipality the documents that are
required by the Bank for purposes of registering the Encumbrance in favor
of the Financing Bank (as defined above) not later than 60 days from the
date of the local committee’s decision on approving the first building
permit on conditions, or at least 60 days before the date specified for
making the Second Payment, whichever is the earlier. The
Municipality will be entitled to discuss the wording of the aforesaid
documents with the Financing Bank and the conformance of those documents
with the provisions of this Agreement. As long as the aforesaid
documents do not conform with the provisions of this Agreement, the
Company will not sign the said
documents.
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16.6.3.5
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The
documents as shall be agreed between the Municipality and the bank and
which under all circumstances shall conform with the provisions of this
Clause 16.6 will henceforth be referred to as – “the Encumbrance Documents in
favor of the Financing Bank”. The Encumbrance Documents
in favor of the Financing Bank shall be signed by the Municipality, and
shall be delivered by the Municipality to the Purchaser in accordance with
the provisions of Clause 6.2.5 above. Contemporaneous with the
Municipality signing the Encumbrance Documents in favor the Financing
Bank, the Municipality shall furnish the Financing Bank with an
undertaking to register a mortgage over the Company’s rights of leasehold
in the Company’s Lands, in accordance with the provisions of sub-clause
16.7.3.1 (b) of the Company’s Lands
Agreement.
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16.7
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It
is hereby agreed that in a case in which each of the individual parties
who make up the Purchaser takes a Construction Loan separately from the
other, the sole responsibility for arranging the series of encumbrances
with the separate Financing Bank of each of the individual parties who
make up the Purchaser in a manner whereby the series of encumbrances as
aforesaid shall conform with the provisions of this Agreement, is that of
the Purchaser or the individual parties who make up the Purchaser, as the
case may be, and the Municipality will sign the Encumbrance Documents in
favor of each of the Financing Banks only in accordance with and subject
to the provisions of sub-clause 16.6
above.
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16.8
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It
is agreed that the provisions of Clauses 16.1 to 16.7 above will also
apply in relation to any transferee who may acquire any rights in the
Project Lands from the Purchaser and/or from the Purchaser’s
transferees.
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17.
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Sale
of apartments by the Housing
Company
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17.1
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The
Housing Company undertakes that all the sale agreements that will be
signed between it and buyers of apartments up to the Date of Delivery of
Possession will be contingent upon a condition precedent of settlement of
the Additional First Payment, the Later First Payment and the Second
Payment on the due date of each of them. It is further agreed
that (1) up to the date of settlement of the Additional First Payment, the
Later First Payment and the Second Payment – all the proceeds that will be
received by the Housing Company from buyers of apartments will be
deposited in a trust account and/or in the account of the Financing Bank,
and under no circumstances will same be transferred to the Housing
Company; (2) if up to the Date of Delivery of Possession, the Housing
Company guarantees the payments that have been paid to it by buyers of
apartments by way of a Sale Law guarantee, then the Sale Law guarantee
will contain an additional ground for foreclosure pursuant to which
cancellation of this Agreement and/or the Company’s
Lands Agreement by the Company and the Municipality will constitute
grounds for foreclosure on the Sale Law guarantee. If the
Housing Company has secured the monies of buyers of apartments in another
way, a refund of the money shall be guaranteed accordingly in the case
mentioned above.
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63
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17.2
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The
Housing Company undertakes that it will include in all the sale agreements
with buyers of apartments a provision pursuant to which the buyers of
those units declare that the Company and the Municipality do not bear any
responsibility or liability to the buyers of
apartments.
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17.3
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The
Housing Company will not be entitled to register a caveat in favor of the
buyers of apartments, until after payment of the full Basic Consideration
and after registration of the leasehold rights in the Municipality Lands
in the name of the Purchaser.
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18.
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Miscellaneous
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18.1
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The
Housing Company undertakes that at the time residential apartments on the
Land that is the subject of this Agreement are offered by it for sale or
rental, every buyer who meets the financial conditions that will be
offered by it at that time in the scope of marketing the apartments, will
be entitled to acquire rights in the apartments that are offered as
aforesaid.
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18.2
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This
Agreement embodies everything that has been agreed between the parties up
to the date of the signing hereof. There shall be no validity
to any representation, statement, exchanges, written or verbal, directly,
indirectly or impliedly, and similar other things on the part of the
Municipality and/or the Company and/or the local committee and/or the
entities connected with any of them, which preceded the signing of this
Agreement. However, with the removal of doubt it is clarified
that nothing contained at the start of this sub-clause 18.2 shall derogate
from the obligations and commitments of the Purchaser and the Interested
Parties in accordance with the sale procedure, to the extent that same are
not contradicted by the provisions of this
Agreement.
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18.3
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No
alteration or waiver of the provisions of this Agreement will be of any
validity unless a written document to that effect has been drawn up and
signed by both the parties.
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18.4
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Any
waiver by a party to this Agreement of any of its rights shall be of no
force and validity unless drawn up in writing. Where in this
Agreement the consent of the party to the contract is required for
purposes of any act, such consent will be of no validity unless given in
writing.
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Without
derogating from the contents of this sub-clause above, wherever in this
Agreement one of the parties is required to fulfill an obligation up to a date
specified in this Agreement, the other party to the Agreement shall have the
right to extend the date in its discretion, or to pardon the fulfillment of the
condition, provided that this is done in writing.
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18.5
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Where
a date has been specified for the obligations of all the parties, they
shall have the right to extend that date by way of written
consent.
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18.6
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Clauses
3, 4 (excluding sub-clause 4.11), 5, 6, 7, 9 (excluding clause 9.9), 10
(excluding 10.2), 11, 13, 16, 17 constitute basic and fundamental clauses
of this Agreement and a breach of a provision contained in any of them
which has not been cured within 30 days from the date of receipt by the
Purchaser of written notice to that effect will be deemed to be a material
breach. It is further agreed that a repeated breach (that is to
say, commencing from the third breach onwards) of any of the provisions of
the above clauses will immediately be deemed to be a material
breach without the necessity for any warning or notice being given by the
Municipality. This provision shall be deemed to have been
included at the end of each of the abovementioned
clauses.
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18.7
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Without
derogating from the contents of Clause 18.6 above, it is hereby agreed
that each of the following cases will be deemed to be a material breach on
the part of the Purchaser, which will entitle the Municipality, in its
discretion, inter alia to the remedy of the cancellation of this contract
by written notice to be delivered to the
Purchaser:
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18.7.1
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If
an application for a stay of proceedings is filed by any of the individual
parties who make up the Purchaser or by any of the Interested
Parties. In a case in which such application is filed by any
third party – only if a stay of proceedings order is
granted.
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18.7.2
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In
the event that a liquidation order or receivership order is granted
against any of the individual parties who make up the Purchaser or against
any of the Interested Parties, or if a provisional or permanent receiver
is appointed for the property of any of them, or if a liquidator or
provisional liquidator is appointed for any of the individual parties who
make up the Purchaser or for any of the Interested Parties, or if any of
the individual parties who make up the Purchaser or any of the Interested
Parties files a proposal for making an arrangement with his or its
creditors – all in a case in which such appointment or order has not been
set aside within 90 days from the date the court order was
granted.
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18.7.3
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If
an attachment has been imposed on the Purchaser’s rights in the
Municipality Lands and/or the rights of any of the individual parties who
make up the Purchaser and/or any of the Interested Parties in other assets
of any sort which serve as collateral for the banking finance, and the
attachment has not been removed within 90 (ninety) days from the date the
attachment was imposed.
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18.7.4
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In
relation to the cases mentioned in sub-clauses 18.7.1-18.7.3 above, which
will be deemed to be material breaches as aforesaid, it is agreed that the
occurrence of the aforesaid events will be examined in relation to each of
the individual parties who make up the Purchaser separately, where an
individual party in respect of whom one of the events mentioned in
sub-clauses 18.7.1-18.7.3 above has occurred will be deemed to be a
Defaulting Individual Purchaser and an individual party who makes up the
Purchaser with respect to whom one of the aforesaid events has not
occurred will be deemed to be a Complying Individual Purchaser, as more
fully described in the provisions of sub-clause 5.2.4.3
above.
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18.8
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If
the Purchaser has fulfilled all its obligations under this Agreement up to
and including payment of the full Basic Consideration on due date, and the
Third Payment has been paid in the hands of the Municipality, then,
without derogating from the remaining remedies available to the
Municipality according to law and agreement, the Municipality will no
longer have a right to cancel this
Agreement.
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18.9
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It
is agreed that any payment which applies to any of the parties to this
Agreement, which is made after the date specified for the payment thereof
in accordance with this Agreement, will bear penalty interest at an annual
rate of 10%, commencing from the first day of default. All this
will be without derogating from any other or additional right or remedy to
which the other party is entitled according to any law and/or
agreement.
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18.10
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This
Agreement is being signed simultaneously with the signing of the agreement
between the Purchaser and the Company for the purchase by the Purchaser of
the rights in the Company’s Lands (hereinbefore and hereinafter: “the Company’s Lands
Agreement”). For the removal of doubt it is clarified
and agreed that this Agreement is the separate and independent agreement
from the Company’s Lands Agreement, and that the transaction which is the
subject of this Agreement is a separate and independent transaction from
the transaction that is the subject of the Company’s Lands
Agreement. The obligations and rights of the Municipality, on
the one hand, and the Company on the other, pursuant to the
above-mentioned agreements, do not constitute joint and several
obligations and rights vis-à-vis the Purchaser, and the Municipality or
the Company are not a guarantor for the fulfillment of the obligations of
one another vis-à-vis the Purchaser in accordance with the aforesaid
agreements, and the existence of the agreements and of the transactions
that are the subject of the Agreements are separate and
independent. Nothing contained in this clause above shall
derogate from the provisions of sub-clause 6.2.5.5
above.
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18.11
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In
the case of a conflict between the provisions of the sale procedure and
the provisions of this Agreement, the provisions of this Agreement shall
prevail.
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18.12
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It
is agreed that the provisions of the Contracts Law (Remedies for Breach of
Contract), 5731-1970 shall apply to this
Agreement.
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18.13
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The
Purchaser will not have any right of set-off or lien, for any reason, in
respect of any amount it is obliged to pay in accordance with the
provisions of this Agreement.
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18.14
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The
Municipality reserves the right, in its sole discretion, to assign,
transfer or endorse its rights and/or obligations under this
Agreement.
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18.15
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Should
this Agreement be cancelled, such cancellation will not derogate from the
validity of the provisions contained in Clauses 4.1 to 4.4, 4.7 to 4.10,
4.11, 4.17, 4.21, 4.22, 13.1 and 14 above and from the validity of the
undertaking pursuant to the deeds of confidentiality of the Purchaser, the
Interested Parties and their representatives which were delivered in the
scope of the sale process.
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18.16
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This
Agreement shall be governed by the laws of the State of Israel and the
court in Tel Aviv will have sole and exclusive jurisdiction to try any
matter connected with this Agreement and/or arising herefrom, according to
its substantive jurisdiction.
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18.17
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Each
party to this Agreement shall bear its own costs and
expenses.
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18.18
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It
is clarified that if this Agreement is translated into foreign languages,
the translation will be solely for purposes of convenience and under all
circumstances the binding version will be the version in the Hebrew
language.
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18.19
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Any
notice that is sent by one party to another shall be deemed to have been
received:
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18.19.1
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After
3 business days from the time of its posting by registered mail at a post
office in Israel;
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18.19.2
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If
delivered by hand - at the time of its
delivery;
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18.19.3
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If
sent by facsimile – at 12:00 noon on the first business day following the
transmission thereof, as confirmed by notice of the facsimile machine from
which it was sent.
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18.20
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The
parties fix their addresses for purposes of the contract as
follows:
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The Municipality
–
c/o:
_______________________
Facsimile:
__________________
The
Individual parties who make up the Purchaser -
c/o:
the address mentioned at the head of this Agreement
_______________.
Facsimile: __________________
The
Interested Parties –
Dirot
Yukra Ltd., Xxxxx Investments 1 Ltd.
c/o:
____________________________
Facsimile:
______________________
Blue
Square Real Estate Ltd.
c/o:
_____________________________
Facsimile:
________________________
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The
parties are entitled to give notice of a change in their address by way of
notice that shall be delivered in accordance with the provisions of Clause 18.19
above, provided that the addresses of the individual parties who make up the
Purchaser and of the Interested Parties shall be in Israel.
In
witness whereof the parties have hereunto signed:
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/s/
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/s/
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The
Housing Company
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The
Mall Company
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/s/
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The
Municipality
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I the
undersigned, _____________________ Adv., hereby certify that _________________
and ___________________ who identified themselves by way of I.D. No. _________
_________ / who are personally known to me, signed this Agreement and that they
are authorized to sign in the name of ____________________ and that their
signature binds __________________.
I the
undersigned, _______________________ Adv., hereby certify that _________________
and ___________________ who identified themselves by way of I.D. No. _________
_________ / who are personally known to me, signed this Agreement and that they
are authorized to sign in the name of ____________________ and that their
signature binds __________________.
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Deed of Undertaking by the
Interested Parties
We, the
undersigned, hereby confirm and undertake as follows:
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1.
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That
the declarations and undertakings given by us in the scope of the sale
process and the sale procedure are correct, complete, full and updated,
and are binding on us along with the Purchaser, for all intents and
purposes.
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2.
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That
we are aware that on the strength of our undertakings as set forth below,
the Municipality has agreed to accept the Purchaser’s offer to buy the
Property Sold and to enter into this Agreement with
it.
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3.
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We
confirm the correctness of all the declarations and representations of the
Purchaser as set forth in the Agreement, in a manner whereby those
declarations and representations shall be deemed as if given by us
directly to the Municipality.
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3A.
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Each
of the Interested Parties hereby declares and undertakes to the
Municipality that it is duly incorporated and that it is entitled and
authorized to make the undertakings set forth in this Deed of Undertaking
and to perform same, and has passed all the resolutions and obtained all
the approvals required according to the provisions of the law and its
documents of incorporation for purposes of entering into this Deed of
Undertaking. Each of the Interested Parties further declares
and undertakes that no steps have been taken with respect to it for an
arrangement, stay of proceedings, winding-up, liquidation, expungement,
bankruptcy or receivership, and that there is no threat against it of such
legal proceedings (including the fact of there being no attachment of its
assets), that are likely to have an effect on its contracting under this
Deed of Undertaking and on the performance of its obligations pursuant
hereto.
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4.
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We
are fully conversant with the provisions of the Agreement and we declare
and undertake that we have the ability to abide by all the Purchaser’s
obligations pursuant to the Agreement, in accordance with the contents of
Paragraph 5 below.
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5.
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We
owe a direct obligation to the Municipality for the fulfillment of all the
Purchaser’s obligations pursuant to the Agreement, including payment of
the Consideration, in accordance with the following
provisions:
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5.1
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The
Interested Parties are responsible and liable directly to the Municipality
for the fulfillment of all the Purchaser’s obligations for payment of the
Consideration as follows:
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5.1.1
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Dirot
Yukra Ltd. is responsible as a direct debtor to the Municipality for
payment of 50% of the payments of the Consideration imposed on the Housing
Company under the Agreement and also for payment of 50% of the payments of
the Consideration imposed on the Mall Company under the
Agreement.
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In
addition:
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5.1.2
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Xxxxx
Investments 1 Ltd. is responsible as a direct debtor to the Municipality
for payment of 25% of the payments of the Consideration imposed on the
Housing Company under the Agreement and also for payment of 25% of the
payments of the Consideration imposed on the Mall Company under the
Agreement.
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In
addition:
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5.1.3
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Blue
Square Real Estate Ltd. is responsible as a direct debtor to the
Municipality for payment of 50% of the payments of the Consideration
imposed on the Housing Company under the Agreement and also for payment of
50% of the payments of the Consideration imposed on the Mall Company under
the Agreement.
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5.1.4
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Without
derogating from the Municipality’s remaining rights pursuant to the
Agreement and according to this Deed of Undertaking, it is clarified for
the removal of doubt that nothing in sub-paragraph 5.1 above has the
effect of derogating from any of the remedies available to the
Municipality according to any law and agreement in the event that the
Housing Company and/or the Mall Company should default in any of their
obligations for payment of the full Consideration (or any part thereof)
under the Agreement (even if the Interested Parties or any of them has
complied with the fulfillment of its obligations to the Municipality
pursuant to this Paragraph 5.1).
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5.2
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The
Interested Parties are directly responsible and liable to the Municipality
for the fulfillment of all the Purchaser’s obligations pursuant to this
Agreement (except only the Purchaser’s obligations for payment of the full
Consideration, in respect of which the provisions of sub-clause 5.1 above
will apply) as follows:
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5.2.1
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Blue
Square Real Estate Ltd. and Dirot Yukra Ltd. are liable, jointly and
severally, as direct debtors to the Municipality for all the Purchaser’s
obligations under the Agreement.
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In
addition:
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5.2.2
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Xxxxx
Investments 1 Ltd. is responsible as a direct debtor to the Municipality
for payment of 50% of all the Purchaser’s obligations pursuant to this
Agreement.
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5.2.3
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For
the removal of doubt it is clarified that included in this sub-clause 5.2,
the Interested Parties in the Housing Company are directly liable and
responsible for all the obligations of the Housing Company for the
construction of the public buildings, as defined in the Agreement above,
with this being in accordance with the provisions of Clause 7 of the
Agreement above and the provisions of the Construction Contract between
the Housing Company and the
Municipality.
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5.3
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Our
undertakings above and below are absolute, irrevocable and unconditional
and included therein our obligations to the Municipality are not
contingent on prior reference by the Municipality to any of the individual
parties who make up the Purchaser and/or upon the exhausting of any
proceedings and/or remedies that are available to the Municipality
according to the Agreement and/or any
law.
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6.
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The
Interested Parties hereby confirm and undertake that they waive any claim,
demand, cause of action or allegation (hereinafter: "Claim") of whatsoever
nature according to any law and agreement as against the Company and/or
the Municipality and/or any of the bodies connected with either of them,
in connection with the subject matter of this Agreement and the actions of
any of the aforesaid entities in connection with the signing and
consummation thereof. The confirmation of the Interested
Parties as set forth above is also given in connection with what is stated
in Clause 4.10 of this Agreement
above.
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7.
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The
Interested Parties confirm that their obligations under this Deed of
Undertaking are as a principal debtor, directly to the Municipality, and
not as a guarantor. Without derogating from the foregoing and
for the sake of caution, the Interested Parties hereby absolutely,
unconditionally and irrevocably waive all or any defense or argument that
is available and/or may be available to them, if any, pursuant to the
Guarantee Law.
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8.
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All
the remedies and forms of relief that are available and/or may in the
future be available to the Municipality as against the Purchaser in
accordance with any law and agreement shall also be available against us
in all respects, including in a manner that none of us will have any
argument or defense which is not expressly available to the
Purchaser.
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In
witness whereof the parties have hereunto signed:
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/s/
Xxxx Xxxxx, Xxxx Xxxxx
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/s/
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Blue
Square Real Estate Ltd.
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Dirot
Yukra Ltd
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/s/
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Xxxxx Investments 1
Ltd.
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Certifications by
Attorney
I the
undersigned, _____________________ Adv., hereby certify that _________________
and ___________________ who identified themselves by way of I.D. No. _________
_________ / who are personally known to me, signed this Agreement and that they
are authorized to sign in the name of ____________________ and that their
signature binds __________________.
I the
undersigned, _______________________ Adv., hereby certify that _________________
and ___________________ who identified themselves by way of I.D. No. _________
_________ / who are personally known to me, signed this Agreement and that they
are authorized to sign in the name of ____________________ and that their
signature binds __________________.
I the
undersigned, _______________________ Adv., hereby certify that _________________
and ___________________ who identified themselves by way of I.D. No. __________
__________ / who are personally known to me, signed this Agreement and that they
are authorized to sign in the name of ____________________ and that their
signature binds __________________.
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