Exhibit 99.1
AGREEMENT OF PURCHASE AND SALE
BETWEEN
HPW Family Partnership, LLC
Xxxxxx Family Partnership, LLC
Riverview Partners, LLC
as SELLER
AND
HARVARD PROPERTY TRUST, LLC
as BUYER
Dated: As of August 31, 2005
TABLE OF CONTENTS
1. AGREEMENT TO BUY AND SELL.................................................1
2. PURCHASE PRICE............................................................2
3. ESCROW AGENT..............................................................3
4. TITLE; SURVEY.............................................................3
5. BUYER'S DUE DILIGENCE.....................................................5
6. ESTOPPEL CERTIFICATES.....................................................9
7. OPERATION OF THE PROPERTY PRIOR TO CLOSING/SELLER'S WORK.................10
8. REPRESENTATIONS AND WARRANTIES...........................................11
9. CONDITIONS PRECEDENT TO CLOSING..........................................16
10. RISK OF LOSS.............................................................18
11. CLOSING..................................................................19
12. PRORATIONS AND CHARGES...................................................19
13. INSTRUMENTS OF CONVEYANCE AND OTHER DOCUMENTS............................22
14. DELIVERY AND PAYMENT.....................................................24
15. BREACH...................................................................25
16. NO OUTSIDE REPRESENTATIONS/AS-IS SALE....................................26
17. SURVIVABILITY............................................................27
18. NOTICES..................................................................27
19. BROKER'S COMMISSION......................................................28
20. BINDING EFFECT...........................................................28
21. SELLER'S LIMITED LIABILITY...............................................28
22. SECTION HEADINGS.........................................................29
23. PRONOUNS.................................................................29
24. AGREEMENT IN COUNTERPARTS................................................29
25. GOVERNING LAW; VENUE.....................................................29
26. TIME OF THE ESSENCE; FAILURE TO ENFORCE NOT A WAIVER.....................29
27. CALCULATION OF TIME PERIODS..............................................29
28. SEVERABILITY.............................................................29
29. PUBLIC DISCLOSURE/MARKETING..............................................29
30. PARTNERSHIP..............................................................30
31. NO RECORDATION...........................................................30
LIST OF SCHEDULES.............................................................33
SCHEDULE 1(a) Legal Description.............................................S-34
SCHEDULE 1(c) Excluded Personal Property....................................S-36
SCHEDULE 1(d) List of Tenant Leases.........................................S-37
SCHEDULE 1(e) List of Service Contracts.....................................S-43
SCHEDULE 5(b) Due Diligence Materials.......................................S-44
SCHEDULE 6 Form of Tenant Estoppel Certificate..............................S-46
SCHEDULE 7(a) Pending New Tenant Leases and Tenant Lease Amendments.........S-50
SCHEDULE 8(a)(iii) Litigation...............................................S-51
SCHEDULE 8(a)(v)(C) Landlord Defaults.......................................S-52
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SCHEDULE 8(a)(v)(D) Tenant Defaults.........................................S-53
SCHEDULE 8(a)(v)(F) List of Security Deposits...............................S-54
SCHEDULE 8(a)(v)(F) Outstanding Tenant Improvement Obligations..............S-55
SCHEDULE 8(a)(vi)(C) Service Contract Defaults..............................S-56
SCHEDULE 8(a)(ix) List of Environmental Reports.............................S-57
SCHEDULE 8(a)(xii) Outstanding Leasing Commissions..........................S-58
SCHEDULE 8(a)(xiii) Leasing Brokerage Agreement.............................S-59
SCHEDULE 9(b)(iv) Form of Management and Exclusive Leasing
Agreement With Xxxxxx-Xxxx, LLC..........................................S-60
SCHEDULE 13(a)(i) Form of Special Warranty Deed.............................S-84
SCHEDULE 13(a)(ii) Form of Xxxx of Sale.....................................S-86
SCHEDULE 13(a)(iii) Form of Assignment and Assumption of Leases.............S-87
SCHEDULE 13(a)(iv) Form of Assignment and Assumption of
Service Contracts and Intangible Property................................S-90
SCHEDULE 13(a)(vi) Form of Affidavit of Non-foreign Status..................S-93
SCHEDULE 13(a)(vii) Form of Seller's Closing Certificate....................S-94
EXHIBIT 1 TO SELLER'S CLOSING CERTIFICATE Listing of
Defaults or Exceptions...................................................S-95
SCHEDULE 13(b)(v) Form of Buyer's Closing Certificate.......................S-96
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AGREEMENT OF PURCHASE AND SALE
THIS AGREEMENT OF PURCHASE AND SALE ("Agreement") dated as of August 31,
2005 is between HPW FAMILY PARTNERSHIP, LLC, a Tennessee limited liability
company, XXXXXX FAMILY PARTNERSHIP, LLC, a Tennessee limited liability company,
and RIVERVIEW PARTNERS, LLC, a Tennessee limited liability company ("Sellers"
and collectively, "Seller"), and HARVARD PROPERTY TRUST, LLC, a Delaware limited
liability company doing business as Behringer Harvard Funds ("Buyer").
RECITALS
A. Seller is the owner of a certain tract of land and an office
building (the "Building") and other improvements thereon, collectively known as
Riverview Tower, Knoxville, Tennessee.
B. Seller desires to sell the Property (as hereinafter defined),
and Buyer desires to acquire the Property from Seller.
NOW, THEREFORE, in consideration of the mutual covenants and promises
set forth in this Agreement, and for other valuable consideration, the receipt
and sufficiency of which is each hereby acknowledged, Seller and Buyer,
intending to be legally bound hereby, agree as follows:
1. AGREEMENT TO BUY AND SELL. Seller shall sell and convey to
Buyer, and Buyer shall purchase and accept from Seller, all of Seller's right,
title, estate, and interest in and to:
(a) the land described on SCHEDULE 1(A), which is attached
to and made a part of this Agreement, together with all easements, privileges,
and appurtenant rights belonging or in any way appertaining to the land
(collectively, the "Land");
(b) the Building and other improvements, and all fixtures
attached to the Land and Building (collectively, the "Improvements," and
together with the Land, the "Real Property");
(c) such furnishings, furniture, equipment, supplies, and
other personal property, if any, as are, or will at Closing be, owned by any
Seller and are currently located in or on the Real Property and used exclusively
in the operation or maintenance of the Real Property, but excluding those items
of personal property which are owned by tenants, licensees, or other third
parties or which may be removed by such parties under the terms of their leases
or which are listed on SCHEDULE 1(C), which is attached to and made a part of
this Agreement, if any, on the Real Property (collectively, the "Personal
Property"). The Personal Property is conveyed subject to depletions,
replacements and additions in the ordinary course of Seller's business;
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(d) all leases and tenancies affecting the Real Property
described on SCHEDULE 1(D), which is attached to and made a part of this
Agreement (collectively, the "Tenant Leases");
(e) all other agreements, contracts, and contract rights
(including equipment leases) pertaining to the Property to the extent
assignable, including without limitation, those described on SCHEDULE 1(E),
which is attached to and made a part of this Agreement (collectively, the
"Service Contracts"); and
(f) all intangible property owned by Seller and used in
connection with the Real Property and Personal Property, including all
trademarks and trade names (including any interest Seller may have in the name
"Riverview Tower" and all logos and marks associated therewith) used in
connection with the Property, all plans and specifications, if any, in the
possession of Seller which were prepared in connection with the construction of
the Improvements and all licenses, permits and warranties now in effect with
respect to the Property, all to the extent assignable, without any warranty or
recourse (collectively, the "Intangible Property").
The Real Property, the Personal Property, the Tenant Leases, the Service
Contracts and the Intangible Property are collectively referred to in this
Agreement as the "Property".
2. PURCHASE PRICE.
(a) Subject to the charges and prorations set forth in
SECTION 12 of this Agreement, Buyer shall pay to Seller at Closing (as
hereinafter defined) the sum of Forty-One Million & 00/100 Dollars
($41,000,000.00) (the "Purchase Price") for the purchase of the Property. The
Purchase Price shall be payable by wire transfer of immediately available
federal funds to Escrow Agent (as hereinafter defined) at Closing. To enable
Seller to make conveyance as herein provided, Seller may, at the Closing, use
the purchase money or any portion thereof to clear the title of any or all
encumbrances or interests, provided that provision reasonably satisfactory to
the Title Company is made at the Closing for prompt recording of all instruments
so procured.
(b) Purchaser will deposit the amount of two million dollars
($2,000,000.00) with Escrow Agent (as defined below) as xxxxxxx money to be held
and disbursed pursuant to the terms of this Agreement (the "Deposit"), payable
as follows: (i) the sum of one million dollars ($1,000,000.00) within two (2)
Business Days following the execution and delivery of this Agreement by both
parties; and (ii) the sum of one million dollars ($1,000,000.00) on the second
(2nd) Business Day immediately following the expiration of the Due Diligence
Period. The Escrow Agent shall hold the Deposit in an interest-bearing account.
If Buyer closes the transactions contemplated by this Agreement, the Deposit,
together with all interest thereon, shall be applied to the Purchase Price.
Otherwise, Escrow Agent shall disburse the Deposit, together with all interest
thereon, to the party entitled to receive the Deposit as herein provided.
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3. ESCROW AGENT. Partners Title Company ("Escrow Agent"), having an
address at 000 Xxxx Xxxxxx, Xxxxx 0000X, Xxxxxxx, Xxxxx 00000-0000, Attention:
Xxxx Xxxxxxxx, shall serve as escrow agent for the transaction contemplated in
this Agreement.
4. TITLE; SURVEY.
(a) Buyer shall obtain a commitment by Escrow Agent (also
referred to herein as "Title Company") to issue an owner's policy of title
insurance insuring the Real Property (the "Title Commitment") and deliver a copy
of the Title Commitment, together with copies of the underlying recorded
documents shown as exceptions in the Title Commitment, to Seller, prior to the
expiration of the Due Diligence Period (as defined below). Buyer, at its option
and expense, may obtain an ALTA survey (the "Survey").
(b) Buyer, by giving written notice to Seller (i) on or
before the date that is three (3) Business Days prior to the expiration of the
Due Diligence Period (as defined below), may object to any title exception in
the Title Commitment or any matter shown on the Survey or (ii) within three (3)
Business Days of receipt of any continuation or update of the Title Commitment
or any update to the Survey, may object to any title matter which appears for
the first time in a continuation or update of the Title Commitment or an update
of the Survey (collectively, "Title Objections").
(c) If Buyer timely provides notice of any Title Objections
pursuant to SECTION 4(B), Seller may, by giving notice to Buyer on or before the
date that is three (3) Business Days after Buyer's objection notice, elect, at
its discretion, either to remove such Title Objections or not to remove such
Title Objections. Seller shall be deemed to have elected not to remove any such
Title Objections unless Seller provides such notice and therein elects to remove
any such objection in accordance with this SECTION 4(C). If Seller elects to
remove any such Title Objection, Seller shall remove the Title Objection in
question on or before the Closing Date (defined below). If Seller elects (or is
deemed to have elected) not to remove any such Title Objection, Buyer shall have
the right, by giving notice to Seller on or before the date that is three (3)
Business Days after Seller's election not to cure (or deemed election not to
cure), either to terminate this Agreement (in which case the Deposit shall be
returned to Buyer as Buyer's sole and exclusive remedy) or to withdraw such
objection and accept title to the Property subject to the title exception or
survey matter in question. If Buyer does not exercise the right to terminate
this Agreement in accordance with this SECTION 4(C), Buyer shall be deemed to
have approved title to the Property subject to the Title Objections in question
and to have withdrawn such Title Objections. If necessary as a result of Buyer's
notice of Title Objections, the Closing Date shall be postponed until Buyer's
right to terminate this Agreement has expired or by Seller for up to thirty (30)
calendar days as Seller may deem necessary to remove such Title Objections.
(d) Without limiting the provisions of SECTION 4(C) relating
to Buyer's deemed approval, Buyer shall be deemed to have approved title to the
Real Property as shown in the Title Commitment, any continuation or update of
the Title Commitment, the Survey and any update of
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the Survey unless Buyer objects to any title exception or survey matter in
accordance with this SECTION 4 and all such matters as well as any matters for
which a Title Objection is made but subsequently withdrawn or deemed withdrawn
pursuant to SECTION 4(C) are deemed approved by Buyer as "Permitted Exceptions".
(e) At the Closing, Seller shall convey title to the Real
Property to Buyer by a special warranty deed (the "Deed"), duly executed and
acknowledged by Seller and in proper form for recording, conveying good and
clear record marketable and insurable fee simple title to the Real Property to
Buyer (or its nominee if specified in written notice from Buyer to Seller
delivered at least seven (7) days prior to the Closing), subject to no
exceptions other than (i) matters created by or to be assumed by Buyer; (ii)
matters specifically set forth in this Agreement, if applicable; (iii) zoning,
building ordinances and laws and provisions of existing and future laws,
regulations, governmental restrictions, governmental requirements, ordinances,
and orders (including, without limitation, any relating to building, zoning and
environmental protection) as to the use, occupancy, subdivision or improvement
of the Real Property; (iv) general and special real estate taxes and assessments
that are a lien on the date of Closing, but are not yet due and payable; (v)
roadways and highways; (vi) the leases set forth in the list of Tenant Leases
attached as SCHEDULE 1(D) hereto, and any other leases consented to by Buyer in
accordance with SECTION 7(A) below, and tenants in possession thereunder; (vii)
any lien or encumbrance encumbering the Real Property as to which Seller shall
deliver to Buyer, or to the Title Company at or prior to the Closing, payment
sufficient to satisfy the obligations secured by such lien or encumbrance (in
the case of liens or encumbrances, if any, which secure the payment of money) or
proper instruments, in recordable form, which upon recordation will cancel such
lien or encumbrance, together with any other instruments necessary thereto and
the cost of recording and canceling the same (it being agreed that no such lien
or encumbrance shall appear as an exception in the Owner's Title Insurance
Policy described in SECTION 9(A)(IV) below); and (viii) the Permitted
Exceptions. All of the foregoing exceptions shall be referred to collectively as
the "Conditions of Title". At the Closing, Seller shall also convey by suitable
instruments of transfer, without warranty, the Property other than the Real
Property (the "Xxxx of Sale").
(f) Notwithstanding the foregoing, however, Seller agrees to
discharge any mortgage liens and other voluntary encumbrances securing the
payment of money due and owing by Seller which currently exist or which may be
placed on the Property by Seller at any time up to and including the date of
Closing (collectively, "Monetary Liens"). Seller shall be responsible for any
fees and/or penalties associated with Seller's prepayment of the existing debt
secured by the Property.
(g) Notwithstanding any provision of this Agreement to the
contrary, if (i) there exists a dispute between Seller and Sun Life Assurance
Company of Canada ("Existing Mortgagee") as to the amount Seller must pay in
order to cause the lien held by Existing Mortgagee in respect of the Property to
be released, (ii) after use of commercially reasonable efforts by Seller, such
dispute is not resolved as of the Closing Date, and (iii) Seller is unable to
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reserve its rights against the Existing Mortgagee by paying the amount insisted
upon by the Existing Mortgagee under protest, then Seller, at Seller's option by
written notice given to Buyer not later than the second Business Day prior to
the scheduled Closing Date, may extend the Closing for up to ten (10) days.
Seller's failure to consummate the transaction that is the subject of this
Agreement at the expiration of the extended time shall constitute a default by
Seller hereunder entitling Purchaser to exercise the remedies set forth in
SECTION 15(B) below.
5. BUYER'S DUE DILIGENCE.
(a) During the period from the date of this Agreement
through five o'clock (5:00) p.m., Eastern time, on the date which is twenty (20)
calendar days from the date of this Agreement (the "Due Diligence Period"),
Buyer shall in accordance with this SECTION 5, in good faith and with diligence,
at Buyer's sole cost and expense, review and investigate the environmental
condition, structural elements and mechanical systems of the Property. Seller
shall provide access to the Property at reasonable times, upon at least
twenty-four (24) hour prior notice to Seller, for all inspections required by
Buyer, which inspections shall be conducted in a manner not disruptive to the
tenants or the operation of the Property. Buyer shall determine whether or not
the Property is acceptable to Buyer within the Due Diligence Period. If, during
the Due Diligence Period, Buyer determines, in its sole discretion, that the
Property is not acceptable, Buyer shall have the right, by giving written notice
to Seller on or before the last day of the Due Diligence Period, to terminate
this Agreement. If Buyer exercises the right to terminate this Agreement in
accordance with this Section 5, this Agreement shall terminate as of the date
such termination notice is given by Buyer (subject to the survival of certain
obligations of the Buyer as set forth in this Agreement), in which event the
Deposit shall be returned to Buyer. If Buyer does not exercise the right to
terminate this Agreement in accordance with this SECTION 5, this Agreement shall
continue in full force and effect, and Buyer shall have no further right to
terminate this Agreement pursuant to this SECTION 5.
(b) Within ten (10) days after the date of this Agreement,
Seller shall make available to Buyer at the Property the following items that
Seller has in Seller's possession or control (collectively the "Due Diligence
Materials"):
(i) all plans and specifications for the Property,
unexpired warranties, title insurance policies and underlying
exception documents, surveys, logs and manuals for building
equipment, if any, and governmental reports and permits and the
Environmental Reports (as defined in SECTION 8(a)(xi)). Seller
shall also permit Buyer to examine the structural, mechanical,
electrical, plumbing, roof, foundation, soils and environmental
condition of the Real Property;
(ii) copies of property rent rolls for the preceding
three (3) month period (which shall identify any rental
concessions, right of first refusals, option to expand or
purchase and exclusivity agreements currently in effect and
shall include a summary of expiring space and renewal options
for all Tenant Leases),
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the Tenant Leases, all Service Contracts and all tenant and
correspondence files relating to the foregoing;
(iii) all of Seller's books and records relating to
the operation and maintenance of the Property for the past three
(3) years including, without limitation, the following documents
that Seller has in its possession or control:
(A) copies of all certificates of occupancy,
licenses, permits, authorizations, and approvals
required by law and issued by all governmental
authorities having jurisdiction over the Property and
copies of all certificates issued by the local board of
fire underwriters (or other body exercising similar
functions);
(B) copies of each xxxx for current real
estate, personal property and possessory interest taxes,
water charges and other utilities;
(C) income, expense (including a detailed
list of all capital expenditures on the Property in
excess of Ten Thousand Dollars ($10,000)), operating
statements and audited property financial statements, if
available.
(iv) all other items set forth on SCHEDULE 5(B)
attached hereto and made a part hereof.
Buyer acknowledges and agrees that, to the best of Buyer's knowledge, Seller, as
of the date of this Agreement, has furnished to Buyer the documents and
materials required by this SECTION 5(B) and Schedule 5(b).
(c) Notwithstanding anything to the contrary herein, Seller
shall not be required to provide, copy or make available to Buyer (and the Due
Diligence Materials shall not include) any internal memoranda, appraisals and
valuation reports and similar information or information covered by the
attorney-client privilege (collectively, the "Confidential Information"). Buyer
acknowledges that the materials relating to the Property to be furnished by
Seller to Buyer (whether copies are provided or made available at the Property
or on-line) contain confidential and proprietary information. Buyer agrees to
keep all such information confidential and not to disclose any such information
to any third party except to the extent necessary to carry out Buyer's review
and investigation of the Property or to obtain financing for the Property.
However, notwithstanding the foregoing provisions, the provisions set forth in
SECTION 5(H) below, or anything else to the contrary contained in this Agreement
(i) Buyer may disclose Due Diligence Materials and information derived therefrom
to its consultants, attorneys, accountants, prospective investors and lenders,
and others who need to know the information for the purpose of assisting Buyer
in connection with the transaction that is the subject of this Agreement; (ii)
the foregoing covenant of confidentiality shall not be applicable to any
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information published by Seller as public knowledge or otherwise available in
the public domain; (iii) Buyer shall be permitted to disclose such information
as may be recommended by Buyer's legal counsel in order to comply with all
financial reporting, securities laws and other legal requirements applicable to
Buyer, including any required disclosures to the Securities and Exchange
Commission; and (iv) any duty of confidentiality set forth in this Agreement
shall terminate upon Closing. If Buyer exercises the right to terminate this
Agreement in accordance with this SECTION 5, Buyer shall, within five (5) days
after the termination date, return to Seller all copies of all materials
relating to the Property theretofore furnished by Seller.
(d) No representation or warranty in respect of any
documents, reports, studies, information or other materials (including the
accuracy or completeness thereof) are or shall be deemed to be made or provided
by Seller relating thereto or to the Property or otherwise, and Buyer hereby
acknowledges that no representations or warranties, either express or implied,
were made by Seller (other than as expressly set forth in this Agreement or the
documents and instruments executed by Seller in connection with this Agreement)
with respect to any of the foregoing. To the extent any person or entity, other
than Seller as expressly set forth herein, including any surveyors, appraisers,
title agents, tenants, escrow agent, attorneys, architects, engineering
consultants or environmental consultants, has made any representations or
warranties (other than as expressly set forth in SECTION 8(A)) or any other
statements (verbal or written) to Buyer, or provided any documents, reports,
studies, information or other materials, Buyer acknowledges it shall have no
claim or right of action against Seller arising therefrom, nor any right to
rescind or revoke this Agreement on account thereof.
(e) Buyer shall indemnify and defend Seller against and hold
Seller harmless from all claims, demands, liabilities, losses, damages, costs
and expenses, including reasonable attorneys' fees and disbursements, arising
out of or in connection with the activities and/or omissions of Buyer or any of
Buyer's representatives, agents or contractors on or about the Property. The
foregoing indemnification covenant shall survive any termination of this
Agreement.
(f) Buyer shall maintain, and shall ensure that its
contractors, agents and third parties under its control maintain, public
liability and property damage insurance from a licensed insurance company
insuring Buyer and its representatives against any liability arising out of any
entry or inspections of the Property pursuant to the provisions hereof. Such
insurance shall be in the amount of Two Million Dollars ($2,000,000) (with
respect to Buyer) and in the amount of One Million Dollars ($1,000,000) (with
respect to Buyer's contractors, agents and third parties under its control)
combined single limit for injury to or death of one or more persons in an
occurrence, and for damage to tangible property (including loss of use) in an
occurrence. Any policy maintained by Buyer (and Buyer's agents) shall (i) insure
the contractual liability of Buyer covering Seller, (ii) name the Seller as
additional insureds, (iii) contain a cross-liability provision, (iv) contain a
provision that the insurance provided by Buyer hereunder shall be primary and
noncontributing with any other insurance available to such Seller, and (v) be in
form and substance adequate to insure against all liability of Buyer and its
agents arising out of any
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entry or inspections of the Property pursuant to the provisions of this Section.
Buyer shall provide Seller with evidence of such insurance coverage prior to any
entry or inspection of the Property.
(g) Buyer acknowledges and agrees that any and all
inspections of the Property shall be subject to the rights of tenants under the
Tenant Leases and shall be conducted in a manner not unreasonably disruptive to
tenants or to the operation of the Property. With respect to meetings with
tenants and subtenants, Seller agrees to permit Buyer to meet with tenants of
the Property; provided, however, that Buyer must provide Seller with written
notice of such said proposed meeting (which shall be arranged by Seller) at
least two (2) Business Days prior thereto, and also provided that Seller's
representative, at Seller's election, may be present at such meeting. Except as
expressly set forth above, neither Buyer nor any of the Buyer's representatives
shall contact tenants of the Property or make any inquiries of tenants of the
Property. Seller shall make available to Buyer Seller's employees,
representatives, contractors, building engineers, leasing agents and property
managers (and their employees) at times and frequencies reasonably sufficient to
allow Buyer to conduct its due diligence prior to the end of the Due Diligence
Period. Seller shall have the right to have a representative present during any
due diligence investigations conducted by Buyer at the Property. In the event
Buyer or any of Buyer's representatives desire to conduct any physically
intrusive due diligence, such as sampling of soils, inspection of building
materials, roof inspections, drilling xxxxx or the like, Buyer shall identify in
writing exactly what procedures such party desires to perform and the identity
of the contractor or consultant which will perform such work and request
Seller's express prior written consent thereto, which consent Seller agrees not
to unreasonably withhold. Upon receipt of Seller's written consent, Buyer and/or
Buyer's representatives, as applicable, shall perform any and all due diligence
strictly in compliance with any and all laws, ordinances, rules, regulations,
permits and licenses applicable to the Property.
(h) Subject to the provisions of SECTION 5(C), if the
Closing does not take place for any reason whatsoever, Buyer shall not, directly
or indirectly, disclose to any person or party or use in any manner (i) any of
the Due Diligence Materials, (ii) any tests, studies, reports and other
documentation relating to the Property provided to Buyer by third parties
("Buyer Reports"), or (iii) any other information of Seller acquired by Buyer
with respect to Seller or the Property. This SUBSECTION 5(H) shall survive the
termination of this Agreement. The Buyer Reports shall be delivered and to the
extent assignable, assigned, to Seller, without any representation as to the
accuracy or validity of such reports.
(i) Buyer has advised Seller that Buyer (at Buyer's sole
cost and expense) must cause to be prepared up to three (3) years of audited
financial statements in respect of the Property in compliance with the policies
of Buyer and certain laws and regulations, including, without limitation,
Securities and Exchange Commission Regulation S-X, Rule 3-14. Seller agrees to
use reasonable efforts to cooperate with Buyer's auditors in the preparation of
such audited financial statements (it being understood and agreed that the
foregoing covenant shall survive the Closing). Without limiting the generality
of the preceding sentence (i) Seller shall,
8
during normal business hours, allow Buyer's auditors reasonable access to such
books and records maintained by Seller (and Seller's manager of the Property) in
respect of the Property as necessary to prepare such audited financial
statements; (ii) Seller shall use reasonable efforts to provide to Buyer such
financial information and existing supporting documentation as are necessary for
Buyer's auditors to prepare audited financial statements; (iii) Seller will make
reasonably available for interview by Buyer and Buyer's auditors the manager of
the Property or other agents or representatives of Seller responsible for the
day-to-day operation of the Property and the keeping of the books and records in
respect of the operation of the Property; and (iv) if Seller has audited
financial statements with respect to the Property, Seller shall promptly provide
Buyer's auditors with a copy of such audited financial statements. If after the
Closing Date Seller obtains an audited financial statement in respect of the
Property for a fiscal period prior to the Closing Date that was not completed as
of the Closing Date, then Seller shall promptly provide Buyer with a copy of
such audited financial statement, and the foregoing covenant shall survive
Closing. Seller's reasonable cooperation pursuant to this SECTION 5(I) shall not
require Seller to (i) incur any out-of-pocket cost or expense (including but not
limited to the fees and expenses of outside accountants) or (ii) create, prepare
or generate any reports or financial records which do not currently exist. Buyer
acknowledges and agrees that its preparation of audited financial statements
shall not extend the Due Diligence Period, the date for Closing or constitute a
closing condition and the sole purpose of this provision is to set forth Buyer's
intent to have such audited financial statements prepared (either before or
after Closing) and to confirm Seller's reasonable cooperation on the terms and
subject to the limitations set forth herein.
6. ESTOPPEL CERTIFICATES. Seller shall make commercially reasonable
efforts to obtain and deliver to Buyer, no later than five (5) Business Days
prior to the Closing Date (the "Estoppel Return Date"), a tenant estoppel
certificate in substantially the form of SCHEDULE 6 attached hereto executed by
each tenant at the Property; provided, however, the form of tenant estoppel
certificate shall reflect appropriate changes thereto for any tenant that has
specific requirements in its Lease regarding the form of the tenant estoppel
certificate. An executed tenant estoppel certificate in the form of SCHEDULE 6
(as such form may be changed for any tenant that has specific requirements in
its Lease regarding the form of the tenant estoppel certificate) is herein
referred to as a "Tenant Estoppel". Seller shall deliver each Tenant Estoppel to
Buyer (regardless of whether it complies with this Agreement) promptly following
Seller's receipt thereof. Notwithstanding anything contained herein to the
contrary, it shall be a condition precedent to the obligation of Buyer to
consummate the transaction that is the subject of this Agreement that Seller
deliver to Buyer, on or before the Estoppel Return Date, Tenant Estoppels
executed by (a) tenants leasing, in the aggregate, at least eighty-five percent
(85%) of the total leased square footage at the Property, excluding the office
space leased by American Apartment Management, Inc. and (b) each tenant that
leases more than three thousand five hundred (3,500) square feet at the
Property, excluding the office space leased by American Apartment Management,
Inc. (such condition being herein referred to as the "Tenant Estoppel
Condition"). In the event that Seller is unable to satisfy the Tenant Estoppel
Condition by the Estoppel Return Date, Seller shall not be in default under this
Agreement and Buyer's sole and
9
exclusive remedy and recourse shall be as follows: if the Tenant Estoppel
Condition is not fulfilled as of the Estoppel Return Date, then, for three (3)
Business Days thereafter, Buyer shall have the option either to (i) waive the
Tenant Estoppel Condition, (ii) extend the Closing Date for up to fourteen (14)
days to allow Seller more time to obtain additional estoppel certificates; or
(iii) terminate this Agreement, in which event the Deposit shall be returned to
Buyer. If Buyer elects to extend the Closing Date pursuant to clause (ii) of the
preceding sentence and the Tenant Estoppel Condition is still not fulfilled on
or before the expiration of the fourteen (14) day extension period, then Buyer
may elect one of the options set forth in clauses (i) and (iii) of the preceding
sentence, as its sole and exclusive remedy and recourse.
7. OPERATION OF THE PROPERTY PRIOR TO CLOSING/SELLER'S WORK.
(a) On the date that is three (3) Business Days in advance
of the end of the Due Diligence Period, Seller shall provide Buyer with updated
lists of Tenant Leases and Service Contracts together with copies of all new
Tenant Leases and Service Contracts. Between the date that is three (3) Business
Days in advance of the end of the Due Diligence Period and the Closing Date,
Seller shall not execute any additional lease or any contract affecting the Real
Property or amend, modify, renew, extend or terminate any of the Tenant Leases
or the Service Contracts in any material respect without the prior approval of
Buyer, which approval shall not be unreasonably withheld or delayed, provided
that Seller will not be obligated to obtain Buyer's written approval (i) if
Seller is contractually obligated to take such action under the terms of any
such Tenant Lease or Service Contract or (ii) to enter into any new Tenant Lease
or amendment to a Tenant Lease currently under negotiation as described on, and
on the terms set forth on, SCHEDULE 7(A) attached hereto.
(b) Between the date of this Agreement and the Closing Date,
Seller shall manage, operate, maintain and repair the Real Property and the
Personal Property in the ordinary course of business in accordance with sound
property management practice, keep the Real Property and the Personal Property
in good repair and working order and sound condition, promptly give Buyer copies
of written notices received by Seller asserting any material breach or default
under the Tenant Leases or the Service Contracts or any material violation of
any permits, covenants, conditions, restrictions, laws, statutes, rules,
regulations or ordinances applicable to the Real Property or the Personal
Property, and perform when due Seller's obligations under the Tenant Leases and
the Service Contracts in accordance with the Tenant Leases, the Service
Contracts and all applicable laws.
(c) Between the date of this Agreement and the Closing Date,
Seller shall keep or cause to be kept in force property insurance covering all
buildings, structures, improvements, machinery, fixtures and equipment included
in the Real Property insuring against risks of physical loss or damage, subject
to standard exclusions, with such policy limits as Seller determines is prudent
in the exercise of sound property management practices.
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(d) Buyer shall review and evaluate all Service Contracts
during the Due Diligence Period and shall assume all Service Contracts as of the
date of Closing; provided, however, that Buyer shall have the right to require
Seller to terminate any Service Contract that Buyer elects not to assume (which
election shall be evidenced by written notice from Buyer to Seller sent during
the Due Diligence Period). If Buyer requests that Seller terminate a Service
Contract, Seller shall terminate such contracts effective as of the date of
Closing and contingent upon such Closing. Any fees or penalties associated with
such termination shall be the sole responsibility of Seller. Seller shall
terminate at the Closing all management contracts and leasing agreements
affecting the Property, subject to the provisions of SECTION 9(B)(IV) below.
Seller agrees to complete any documentation that may be required by a warrantor
in order to consummate an assignment to Buyer of any assignable warranties
included in the Property and to pay the cost of any fee required to transfer any
such warranty (but excluding any charges related to continuation of such
warranty from and after Closing).
8. REPRESENTATIONS AND WARRANTIES.
(a) Seller represents and warrants to Buyer as follows as of
the date of this Agreement:
(i) Sellers are limited liability companies duly
organized and validly existing under the laws of the State of
Tennessee and qualified to do business in the State of
Tennessee, and Sellers have all necessary power and authority
to: (A) carry on the business for which it has been organized;
(B) own and operate the Property; and (C) enter into and perform
Seller's obligations under this Agreement.
(ii) Seller has taken all actions required to be
taken under the laws of the State of Tennessee and under each
Seller's respective operating agreement to approve or authorize
the execution and delivery of this Agreement and consummation of
the transactions contemplated in this Agreement.
(iii) There is no litigation, proceeding, or action
pending or, to Seller's actual knowledge, threatened against
Seller or relating specifically to the Property, that could
materially adversely affect the Property or its ownership or
operation by Buyer, except as shown on SCHEDULE 8(A)(III).
(iv) Seller has received no written notice that there
is any condemnation proceeding pending against the Real
Property.
(v) As to the Tenant Leases,
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(A) the Tenant Leases constitute all of the
leases and occupancy agreements affecting the Property,
and are accurately listed on SCHEDULE 1(D) attached
hereto.
(B) complete, true, and correct copies of
all written leases disclosed on SCHEDULE 1(D), including
all modifications and amendments thereof or thereto,
have been or will be promptly made available to Buyer at
the Property.
(C) except as disclosed on SCHEDULE
8(A)(V)(C), which is attached to and made a part of this
Agreement, Seller has not received written notice that
it is in default in the performance of any covenant to
be performed by the landlord under the Tenant Leases or
that any tenant has any claims or offsets against Seller
pursuant to the Tenant Leases. All Tenant Leases are in
full force and effect.
(D) except as disclosed on SCHEDULE
8(A)(V)(D), which is attached to and made a part of this
Agreement, no tenant is in monetary default with respect
to base rent and escalations and to Seller's actual
knowledge no Tenant is otherwise in default in any
material respect under its Tenant Lease.
(E) SCHEDULE 8(A)(V)(E), which is attached
to and made a part of this Agreement, includes a list of
security deposits held under the Tenant Leases, and
identifies whether the same is held as cash, letter of
credit, promissory note or otherwise.
(F) except as disclosed on SCHEDULE
8(A)(V)(F), which is attached to and made a part of this
Agreement, there are no amounts that have become due and
payable by Seller for tenant improvements that were not
paid to the extent required to have been paid and there
is no work required to be completed by Seller that was
not completed in accordance with the requirements of the
Tenant Leases and there are no amounts which are owed to
Tenants on account of tax refunds obtained by Seller.
(vi) As to the Service Contracts,
(A) the Service Contracts are accurately
listed on SCHEDULE 1(E) attached hereto, and there are
no agreements, contracts or contract rights relating to
the furnishing of services to the Property other than
the Service Contracts.
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(B) complete, true, and correct copies of
all written Service Contracts disclosed on SCHEDULE
1(E), including all modifications and amendments thereof
or thereto, have been or will be promptly made available
to Buyer at the Property.
(C) except as disclosed on SCHEDULE
8(A)(VI)(C), which is attached to and made a part of
this Agreement, Seller has not received written notice
that it is materially in default in the performance of
any covenant to be performed by Seller under the Service
Contracts, or that any party to the Service Contracts
has any claims or offsets against Seller pursuant to the
Service Contracts.
(vii) Seller has received no written notice from a
public authority that there are contemplated improvements to or
adjoining the Real Property by a public authority, the costs of
which are to be assessed as special taxes against the Real
Property.
(viii) Seller has received no written notice from any
governmental agency that the Real Property is in violation of
applicable statutes, laws, regulations, rules, ordinances,
orders, permits, approvals, licenses or agreements of any kind,
including, without limitation, Environmental Laws.
(ix) Attached hereto as SCHEDULE 8(A)(IX) is a list
of all environmental/hazardous waste studies and reports
relating to the Property which are in Seller's possession or
control (the "ENVIRONMENTAL Reports"). Seller has furnished to
Buyer true and complete copies of the Environmental Reports,
which are delivered subject to the provisions of SECTION 5(D).
Except as set forth in the Environmental Reports, to Seller's
actual knowledge, no Hazardous Materials are located on or
within the Real Property.
(x) None of the Sellers are a "foreign person" as
defined in section 1445 of the Internal Revenue Code of 1986, as
amended, and the Income Tax Regulations thereunder.
(xi) Except as expressly set forth in SECTION 19
below, Seller has not dealt with any real estate broker or
finder in connection with the sale of the Property to Buyer or
this Agreement so as to entitle such other dealer, agent, or
broker to receive any commission or fee in connection with sale
of the Property to Buyer.
(xii) Except as set forth on SCHEDULE 8(A)(XII) there
are no outstanding leasing commissions owed for the base term
(excluding renewals, expansions or extensions) of Tenant Leases.
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(xiii) Seller is not a party to any leasing brokerage
agreements for which Buyer would be responsible except for those
listed on SCHEDULE 8(A)(XIII).
(xiv) Neither the execution of this Agreement nor the
consummation of the transactions contemplated in this Agreement
will constitute a violation of, be in conflict with, or
constitute a default under (or with the passage of time or
delivery of notice, or both, would constitute a default under)
any term or provision of Sellers' respective articles of
organization and operating agreement, as the case may be, or any
other agreement or other instrument to which Seller is bound.
(xv) Seller has not (A) made a general assignment for
the benefit of creditors, (B) filed any voluntary petition in
bankruptcy or suffered the filing of any involuntary petition by
Seller's creditors, (C) suffered the appointment of a receiver
to take possession of all, or substantially all, of Seller's
assets, (D) suffered the attachment or other judicial seizure of
all, or substantially all, of Seller's assets, (E) admitted in
writing its inability to pay its debts as they come due, or (F)
made an offer of settlement, extension or composition to its
creditors generally.
(b) Buyer represents and warrants to Seller as follows:
(i) Buyer is a Delaware limited liability company,
duly organized, validly existing and in good standing under the
laws of Delaware, and Buyer has and will have on the Closing
Date all necessary power and authority to: (A) carry on the
business for which it has been organized; (B) own and operate
the Property; and (C) enter into and perform Buyer's obligations
under this Agreement.
(ii) Buyer has taken all actions required to be taken
under the laws of Delaware and under Buyer's articles of
organization, operating agreement, and other organizational
documents, to approve or authorize the execution and delivery of
this Agreement and consummation of the transactions contemplated
in this Agreement. The individual executing this Agreement is
duly authorized to bind the Buyer.
(iii) Neither the execution of this Agreement nor the
consummation of the transactions contemplated in this Agreement
will constitute a violation of, be in conflict with, or
constitute a default under (or with the passage of time or
delivery of notice, or both, would constitute a default under)
any term or provision of Buyer's partnership agreement, articles
of incorporation and by-laws or articles of organization and
operating agreement, as the case may be, or any other agreement
or other instrument to which Buyer is bound.
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(iv) Buyer has not (A) made a general assignment for
the benefit of creditors, (B) filed any voluntary petition in
bankruptcy or suffered the filing of any involuntary petition by
Buyer's creditors, (C) suffered the appointment of a receiver to
take possession of all, or substantially all, of Buyer's assets,
(D) suffered the attachment or other judicial seizure of all, or
substantially all, of Buyer's assets, (E) admitted in writing
its inability to pay its debts as they come due, or (F) made an
offer of settlement, extension or composition to its creditors
generally.
(c) When the phrase "to Seller's actual knowledge" or
similar phrase is used with respect to Seller, it shall (i) be limited to the
actual knowledge of J. Xxxxx Xxxxxxxxx, Xxx X. Xxxxx, Xxxxx Xxxx and Xxxxxxx X.
Xxxxxx only, (ii) be deemed to refer to the current actual, not implied,
constructive or imputed, knowledge of such person, as of the times expressly
indicated only, and without any obligation to make any independent investigation
of, or any implied duty to investigate, the matters being represented and
warranted, or to make any inquiry of any other persons, or to search or to
examine any files, records books, correspondence and the like, and (iii) not be
construed to refer to the knowledge of any other beneficial owner, officer,
director, employee, shareholder or agent of Seller. There shall be no personal
liability on the part of the individual named above arising out of any
representations or warranties made herein or otherwise.
(d) To the extent a tenant estoppel or other certificate is
provided to Buyer which sets forth information with respect to any item as to
which Seller has made a representation or warranty, then Seller's representation
and warranty with respect to such information will thereafter be null and void
and of no further force and effect and Buyer shall rely on the information in
the tenant estoppel certificate.
(e) If after the date of this Agreement but prior to the
Closing, Buyer obtains knowledge that any of Seller's representations and
warranties are untrue, inaccurate or incorrect in any material respect, Buyer
shall give Seller notice thereof within five (5) Business Days of obtaining such
knowledge (but, in any event, prior to the Closing). If after the date of this
Agreement but prior to the Closing, Seller obtains actual knowledge that any of
Seller's representations and warranties are untrue, inaccurate or incorrect in
any material respect (after taking into account any and all modifications to
Seller's representations and warranties effected pursuant to paragraph (d)
above), Seller shall give Buyer notice thereof within five (5) Business Days of
obtaining such actual knowledge (but, in any event, prior to the Closing). In
either such event, Seller shall have the right to cure such misrepresentation or
breach and, unless Buyer waives any such misrepresentation or breach, shall be
entitled to a reasonable adjournment of the Closing (not to exceed forty-five
(45) days), Seller hereby reserving the right, in its sole discretion, at any
time during such period of adjournment to notify Buyer that it no longer elects
to endeavor to effect any such cure, in which event Buyer shall have forty-eight
(48) hours including one full Business Day from receipt of such notice in which
to notify Seller of its election as provided in the next succeeding sentence. If
Seller is unable or elects not to so cure
15
any such misrepresentation or breach, then Buyer, as its sole remedy for any and
all such materially untrue, inaccurate or incorrect representations or
warranties, shall elect either (i) to waive such misrepresentations or breaches
or representations or warranties and consummate the transactions without any
reduction of or credit against the Purchase Price, or (ii) to terminate this
Agreement by notice given to Seller on the Closing Date, in which event this
Agreement shall terminate, the Deposit and all interest thereon shall be
returned to Buyer and neither party shall have any further liability to the
other hereunder, except as otherwise provided herein. The untruth, inaccuracy or
incorrectness of Seller's representations and warranties shall be deemed
material only if Buyer's aggregate damages resulting from any such untruths,
inaccuracies or incorrectness are reasonably estimated to exceed Fifty Thousand
& 00/100 Dollars ($50,000.00).
(f) The representations and warranties set forth in this
SECTION 8 shall survive for the period of twelve (12) months after the
consummation of the transactions contemplated by this Agreement and the
recording of the Deed and Seller shall be liable to Buyer hereunder for a breach
of a Seller's representations with respect to which a claim is made by Buyer
against Seller, in a writing delivered to Seller, on or before the date that is
twelve (12) calendar months after the date of the Closing. Anything in this
Agreement to the contrary notwithstanding, the maximum aggregate liability of
all Sellers for breaches of Sellers' representations shall not exceed the lesser
of Buyer's actual damages and Two Million & 00/100 Dollars ($2,000,000.00) in
the aggregate, nor shall any claim be made for any item unless the claims for
all such breaches collectively aggregate more than Fifty Thousand & 00/100
Dollars ($50,000.00). Notwithstanding the foregoing, however, if the Closing
occurs, Buyer hereby expressly waives, relinquishes and releases any right or
remedy available to it at law or in equity, under this Agreement or otherwise to
make a claim against Seller for damages that Buyer may incur, or to rescind this
Agreement and the transaction, as the result of any of Seller's representations
being untrue, inaccurate or incorrect if Buyer had actual knowledge at the time
of the Closing that such representation or warranty was untrue, inaccurate or
incorrect.
9. CONDITIONS PRECEDENT TO CLOSING.
(a) Buyer's obligations under this Agreement are expressly
conditioned upon completion or satisfaction of the following matters on or prior
to the Closing Date:
(i) Seller shall have deposited with the Escrow
Agent all documents required of Seller to be delivered into
Escrow hereunder;
(ii) Seller shall not be in material default of its
obligations hereunder; provided that Buyer shall have provided
notice to Seller of such default and Seller shall have the right
to cure such default and, unless Buyer waives any such default,
Seller, at its option, shall be entitled to a reasonable
adjournment of the Closing (not to exceed five (5) days from the
later of the originally scheduled Closing Date or Seller's
receipt of notice from Buyer of the default) in which to effect
such cure, subject to the provisions of SECTION 4(G) above;
16
(iii) The representations and warranties of Seller
contained in SECTION 8(A) of this Agreement shall be true and
correct in all material respects as of the Closing Date, subject
to SECTION 8(E) above;
(iv) The Title Company shall be prepared to issue to
Buyer an ALTA Owner's Title Insurance Policy, with such
endorsements as Buyer has specified and which the Title Company
has included in its commitment issued prior to the expiration of
the Due Diligence Period, and with liability equal to the total
purchase price for the Property, insuring Buyer that fee title
to the Property is vested in Buyer subject only to the
Conditions of Title; and
(v) The Tenant Estoppel Condition shall have been
satisfied.
(b) Seller's obligations to perform hereunder are expressly
contingent and conditional upon the satisfaction of the following:
(i) Buyer shall have deposited or have caused to be
deposited with the Escrow Agent all documents and funds required
of Buyer to be deposited into Escrow or paid hereunder;
(ii) Buyer shall not be in material default of its
obligations hereunder; provided that Seller shall have provided
notice to Buyer of such default and Buyer shall have the right
to cure such default and, unless Seller waives any such default,
Buyer, at its option, shall be entitled to a reasonable
adjournment of the Closing (not to exceed five (5) days from the
later of the originally scheduled Closing Date or Buyer's
receipt of notice from Seller of the default) in which to effect
such cure;
(iii) The representations and warranties of Buyer
contained in SECTION 8(B) of this Agreement shall be true and
correct in all material respects as of the Closing Date; and
(iv) Buyer or its assignee shall have executed a
management and exclusive leasing agreement with Xxxxxx-Xxxx, LLC
in a form substantially identical to that attached hereto as
SCHEDULE 9(B)(IV).
(c) The parties acknowledge that the conditions precedent
set forth in SUBSECTION (A) above are for the benefit of Buyer and that the
conditions precedent set forth in SUBSECTION (B) above are for the benefit of
Seller. Unless otherwise specifically set forth herein, the date by which the
conditions precedent must be satisfied shall be the Closing Date. If any of the
conditions precedent set forth in SUBSECTION (A) or SUBSECTION (B) above are not
satisfied on or before the date by which they are required to be satisfied, the
party for whose benefit the condition precedent exists shall have the right to
terminate this Agreement by written notice of
17
termination given to the other party on or before the Closing Date or, if
earlier, within ten (10) days after the date by which the condition must be
satisfied. If such notice of termination is given, Escrow Agent shall return all
documents and funds previously deposited into escrow to the party so depositing
same, except if the events described in SUBSECTIONS 9(B)(I) THROUGH (IV) are not
satisfied, the Deposit shall be transferred to Seller and neither party shall
have any further liability to the other hereunder, except as otherwise provided
herein. Notwithstanding the foregoing, a party for whose benefit the condition
precedent exists shall have the right to waive satisfaction thereof, in which
event this Agreement shall proceed to Closing as otherwise provided herein.
Unless notice of failure to satisfy conditions precedent is given as above
provided, all conditions precedent shall be deemed satisfied.
10. RISK OF LOSS.
(a) If, before the Closing Date, the improvements on the
Property are damaged by any insured casualty and the cost to restore such
improvements, as reasonably determined by Buyer, is more than ten percent (10%)
of the Purchase Price, Buyer shall have the right, by giving notice to Seller
within ten (10) days after Seller gives notice of the occurrence of such
casualty to Buyer, to terminate this Agreement, in which event this Agreement
shall terminate and the Deposit shall be returned to Buyer. If, before the
Closing Date, the improvements on the Property are damaged by any casualty not
covered by insurance and the cost to restore such improvements, as reasonably
determined by Seller and Buyer, is more than One Million & 00/100 Dollars
($1,000,000.00), Seller and Buyer each shall have the right, by giving notice to
the other within ten (10) days after Seller gives notice of the occurrence of
such casualty to Buyer, to terminate this Agreement, in which event this
Agreement shall terminate and the Deposit shall be returned to Buyer. If, before
the Closing Date, the improvements on the Property are damaged by any insured
casualty and the cost to restore such improvements, as reasonably determined by
Buyer, is less than ten percent (10%) of the Purchase Price, or the improvements
on the Property are damaged by any casualty not covered by insurance and the
cost to restore such improvements, as reasonably determined by Seller and Buyer,
is One Million & 00/100 Dollars ($1,000,000.00) or less, or either Seller or
Buyer has the right to terminate this Agreement pursuant to either of the
preceding sentences but neither Seller nor Buyer exercises such right, then this
Agreement shall remain in full force and effect and, on the Closing Date, any
insurance proceeds (or, if not theretofore received, the right to receive such
proceeds) payable to Seller on account of the damage shall be transferred to
Buyer and the amount of any deductible under Seller's insurance policy to the
extent of the restoration cost as reasonably determined by Buyer (or, in the
case of an uninsured casualty, the restoration cost as reasonably determined by
Seller and Buyer) shall be a credit to Buyer against the total purchase price
for the Property. Seller shall give notice to Buyer reasonably promptly after
the occurrence of any damage to the improvements on the Property by any
casualty. If necessary, the Closing Date shall be postponed until Seller has
given any notice to Buyer required by this SECTION 10(A) and the period of ten
(10) days described in this SECTION 10(A) has expired.
18
(b) If, before the Closing Date, proceedings are commenced
for the taking by exercise of the power of eminent domain of any part of the
Property, Buyer shall have the right, by giving notice to Seller within ten (10)
days after Seller gives notice of the commencement of such proceedings to Buyer,
to terminate this Agreement, in which event this Agreement shall terminate and
the Deposit shall be returned to Buyer. Seller shall give notice to Buyer
reasonably promptly after Seller's receiving notice of the commencement of any
proceedings for the taking by exercise of the power of eminent domain of all or
any part of the Property. If necessary, the Closing Date shall be postponed
until Seller has given any notice to Buyer required by THIS SECTION 10(B) and
the period of ten (10) days described in this SECTION 10(B) has expired.
11. CLOSING. Payment of the purchase price and the closing hereunder
("xxx Xxxxxxx") shall take place at 3:00 p.m. Eastern Time on that date which is
thirty (30) calendar days after the expiration of the Due Diligence Period (the
"Closing Date"); provided, however, that if the thirtieth (30th) calendar day
after the expiration of the Due Diligence Period is not a Tuesday, Wednesday or
Thursday, then the Closing Date shall be the first Tuesday following the
thirtieth (30th) calendar day after the expiration of the Due Diligence Period.
Except as otherwise provided herein, such date and time may not be extended
without the prior written approval of both Seller and Buyer. If Buyer is not
otherwise in default hereunder, Buyer shall have the right to extend the Closing
Date for one (1) period of thirty (30) calendar days upon payment of an
additional Deposit in the amount of five hundred thousand dollars ($500,000.00),
delivered to the Escrow Agent, on or before the Closing Date, which amount shall
be held, applied and/or disbursed in the same manner as the Deposit described in
SECTION 2(B) above. Closing shall occur by delivery of documents into escrow
with Escrow Agent; provided, however, upon written notice by either party to the
other not less than three (3) Business Days prior to the Closing Date that an
in-person Closing is required, the Closing shall take place at the offices of
Escrow Agent.
12. PRORATIONS AND CHARGES.
(a) At Closing, Buyer and Seller shall prorate as of the
Closing Date those items of income and expense that are capable of an exact
determination. For those items of income and expense that are incapable of an
exact determination as of the Closing Date, Buyer and Seller shall make a good
faith estimate of the closing prorations using the most recent ascertainable
amounts of or other reliable information in respect to each such item of income
and expense. Real estate taxes and assessments that are not yet due and payable
shall be apportioned using the rates and valuation shown on the latest available
tax xxxx. If percentage rent is payable pursuant to any of the Tenant Leases,
Seller shall be entitled to its prorata share of any percentage rent under any
Tenant Lease for any lease year which includes the Closing Date, and the
proration shall be based on a fraction, the numerator of which shall be the
number of days in such lease year before Closing and the denominator of which
shall be the total number of days in such lease year, applied to the actual
percentage rent due under any such Tenant Lease for the applicable lease year.
Seller shall prepare calculations for any tenant reconciliations of operating
19
expenses and taxes for the calendar year 2005 and Buyer shall cooperate with
Seller, including providing copies of invoices, distributing the notices to
tenants thereof and collecting any underpayments thereof. Buyer and Seller shall
use their best efforts to obtain an exact determination of the remaining items
of income and expense as soon as possible after Closing. In any event, on or
before March 31, 2006, Buyer shall deliver a report to Seller, indicating which
estimated closing items have been determinable, together with such documentation
enabling Buyer to make such exact determination and the amount either owed by,
or owed to, Seller. Seller shall have twenty (20) days to review such report and
indicate its approval of such determinations. After approval of such report or
after receipt of the actual xxxx for real estate taxes and/or percentage rent,
if Buyer owes money to Seller, Buyer shall promptly pay such overage to Seller,
or if Seller owes Buyer money, Seller shall promptly pay the amount so owed to
Buyer. This provision shall survive the Closing and the recording of the Deed
for a period of one year and shall not be merged thereby and except as provided
in SECTION 12(B) below, any items that have not been determined at such time
shall be finally paid on the basis of estimates. For purposes of computing any
prorations required under this Section, the Closing Date shall be a day of
income and expense to Buyer unless the Closing Date occurs on the last day of a
month, in which event the Closing Date shall be a day of income and expense to
Seller.
(b) Buyer shall be responsible for all improvement, moving,
relocation or other payments, credits, allowances or obligations to tenants
(including any parking subsidy obligations) and leasing commissions for (i) all
Tenant Leases executed after Closing; and (ii) any new Tenant Leases or
amendments or extension of any existing Tenant Leases executed after the date of
this Agreement but prior to Closing and approved by Buyer during the term of and
pursuant to this Agreement including, without limitation those new Tenant Leases
and amendments or extensions of existing Tenant Leases set forth on SCHEDULE
7(A) if on the terms set forth in SCHEDULE 7(A). Seller shall be responsible for
all improvement, moving, relocation or other payments, credits, allowances or
obligations to tenants (including any parking subsidy obligations) and leasing
commissions for all Tenant Leases executed prior to the date of this Agreement;
provided that Buyer shall be responsible for any and all payments, credits,
allowances or obligations to tenants (including any parking subsidy obligations)
and leasing commissions due: (i) upon the exercise of any unexercised extension,
renewal or expansion option under any Tenant Lease, whenever executed; and (ii)
under any new Tenant Lease or amendment or extension of any existing Tenant
Lease executed after the date of this Agreement but prior to Closing and
approved by Buyer during the term of and pursuant to this Agreement including,
without limitation, those new Tenant Leases and amendments or extensions of
existing Tenant Leases set forth on SCHEDULE 7(A) if on the terms set forth in
SCHEDULE 7(A). This SECTION 12(B) shall survive the Closing.
(c) If on the Closing Date, any tenant is delinquent in the
payment of rent or any other monetary obligations, such delinquent rent shall
remain the property of Seller and no proration with respect thereto shall be
made at Closing. Seller shall have the right to collect the same from such
Tenant, including the right to xxx such Tenant for nonpayment of rent, provided
Seller may not seek to evict such tenant, terminate such Tenant's Lease or seek
possession of the
20
premises demised pursuant to such Tenant's Lease. If Buyer receives any amount
from such tenant after Closing, Buyer shall apply the same to the most current
monthly rental obligations and any remainder to the most recent month of past
due rent and remit such remainder to Seller to the extent that such receivable
is the property of Seller. Buyer shall xxxx and use commercially reasonable
efforts to collect such arrearages. This SECTION 12(C) shall survive the
Closing.
(d) At Closing, Seller shall be charged the following:
(i) prorated general real estate taxes and
assessments;
(ii) prorated charges for Service Contracts and any
other obligations assumed by Buyer for which payments are made
in arrears;
(iii) prorated prepaid rents and other charges prepaid
under the Tenant Leases;
(iv) security deposits held in cash by Seller
pursuant to the Tenant Leases;
(v) one-half (1/2) of the escrow fee;
(vi) the brokerage fees payable to Xxxxxx-Xxxx, LLC
in connection with this transaction, as required by SECTION 19
of this Agreement;
(vii) Seller's attorneys' fees; and
(viii) costs of discharging and releasing all Monetary
Liens.
(e) At Closing, Buyer shall be charged the following:
(i) charges paid in advance by Seller relating to
periods post-Closing for items assumed by Buyer;
(ii) cost of recording the Deed and such other
instruments as Buyer or Buyer's title company may consider
necessary or desirable to be recorded;
(iii) cost of Buyer's title insurance policy and,
subject to the provisions of SECTION 4(E)(VIII) of this
Agreement (as expressly undertaken and assumed by Seller, at its
option), any endorsements thereto to insure over any title
defect;
(iv) the cost of any transfer taxes or deed stamps
required to record the Deed;
(v) one-half (1/2) of the escrow fee;
21
(vi) the cost of the Survey and all expenses and
costs related to Buyer's due diligence;
(vii) the brokerage fees payable to Site Systems, Inc.
in connection with this transaction, together with any other
amounts payable by Buyer pursuant to SECTION 19 of this
Agreement; and
(viii) Buyer's attorneys' fees.
13. INSTRUMENTS OF CONVEYANCE AND OTHER DOCUMENTS.
(a) On or prior to the Closing Date, Seller shall deposit
with Escrow Agent the following documents, fully and properly executed to the
extent applicable:
(i) the Deed in the form of SCHEDULE 13(A)(I), which
is attached to and made a part of this Agreement;
(ii) a xxxx of sale (the "Xxxx of Sale") in the form
of SCHEDULE 13(A)(II), which is attached to and made a part of
this Agreement, made without warranty other than the conveyance
to Buyer of good title to the Personal Property, free and clear
of all liens and encumbrances;
(iii) a counterpart assignment and assumption of the
Tenant Leases (the "Assignment of Leases"), in the form of
SCHEDULE 13(A)(III), which is attached to and made a part of
this Agreement, pursuant to which Seller assigns and Buyer
assumes all of Seller's right, title, obligations, and interest
as lessor under the Tenant Leases;
(iv) a counterpart assignment and assumption of the
Service Contracts and the Intangible Property (the "Assignment
of Service Contracts and Intangible Property"), in the form of
SCHEDULE 13(A)(IV), which is attached to and made a part of this
Agreement, pursuant to which Seller assigns and Buyer assumes
all of Seller's right, title, obligations and interest in and to
the Service Contracts which are not terminated as hereinabove
provided and the Intangible Property;
(v) a counterpart settlement statement (the
"Settlement Statement") setting forth the Purchase Price and all
amounts charged against Seller pursuant to SECTION 12 of this
Agreement;
(vi) an affidavit in the form of SCHEDULE 13(A)(VI),
which is attached to and made a part of this Agreement,
regarding the non-foreign status of Seller;
(vii) a closing certificate (the "Seller's Closing
Certificate") in the form of SCHEDULE 13(A)(VII), which is
attached to and made a part of this Agreement,
22
stating that, to the actual knowledge of Seller, there is no
default under the covenants, representations and warranties of
Seller contained in this Agreement and, in addition, that all
such representations and warranties are true and correct in all
material respects as of the Closing Date as if made on and as of
the Closing Date (or specifying in reasonable detail any
defaults or exceptions that may then exist), subject to each of
the limitations and conditions in SECTION 8 of this Agreement;
(viii) a letter to each tenant identified on SCHEDULE
1(D) of this Agreement and any other tenant under a lease
approved in accordance with SECTION 7(A) hereof, stating that
the Property has been conveyed to Buyer as of the Closing Date
and advising each tenant that all payments of rent due for the
period after Closing and all other future correspondence
regarding the Property should be delivered to Buyer (the "Tenant
Letters");
(ix) such customary affidavits, evidence and
documents as may be reasonably required by Buyer's title company
in order to issue so-called owner's and lender's title insurance
policies insuring Buyer's title to the Property, as relate to
(i) mechanics' or materialmen's liens; (ii) parties in
possession; and (iii) the status and capacity of Seller and the
authority of the person or persons who are executing the various
documents on behalf of Seller in connection with the sale of the
Property; and
(x) to the extent any security deposit is held by
Seller in the form of a letter of credit, the original of such
letter of credit together with instruments of transfer required
by the issuer in order to have the letter of credit reflect
Buyer as beneficiary. Seller shall cooperate with Buyer in
obtaining the transfer of any such letters of credit and shall
be responsible for all costs incurred in transferring any such
letters of credit, such obligations to survive the Closing. To
the extent the security deposit is in the form of a promissory
note or other instrument, the original thereof together with an
endorsement or other appropriate instrument of assignment.
(b) On or prior to the Closing Date, Buyer shall fully
execute and deposit with Escrow Agent the following documents and funds:
(i) the Purchase Price, subject to the closing
adjustments contemplated hereby;
(ii) such evidence or documents as may reasonably be
required by Buyer's title company evidencing the status and
capacity of Buyer and the authority of the person or persons who
are executing the various documents on behalf of Buyer in
connection with the purchase of the Property;
23
(iii) a counterpart Assignment of Leases;
(iv) a counterpart Assignment of Service Contracts
and Intangible Property;
(v) a certificate ("Buyer's Closing Certificate") in
the form of SCHEDULE 13(B)(V), which is attached to and made a
part of this Agreement, stating that there is no default under
the covenants, representations and warranties of Buyer contained
in this Agreement and, in addition, that, to Buyer's actual
knowledge, all such representations and warranties are true and
correct in all material respects as of the Closing Date as if
made on and as of the Closing Date (or specifying in reasonable
detail any defaults or exceptions that may then exist);
(vi) a counterpart Settlement Statement setting forth
the Purchase Price and all amounts applied on behalf of or
charged against Buyer pursuant to SECTION 12 of this Agreement;
and
(vii) the management and exclusive leasing agreement
with Xxxxxx-Xxxx, LLC.
14. DELIVERY AND PAYMENT. Upon consummation of the transactions
contemplated in this Agreement, Escrow Agent shall disburse funds and documents
as follows:
(a) To Seller:
(i) the Purchase Price, less amounts charged to
Seller;
(ii) executed originals of the documents and other
deliveries listed in SECTION 13(B) above; and
(iii) the balance, if any, in the escrow account to
the credit of Seller by check or by wire transfer payable to
Seller.
(b) To Buyer:
(i) the Deed, the Assignment of Leases and title
clearing documents (each of which may be released by Escrow
Agent for recording contemporaneously with the Closing pursuant
to usual and customary escrow instructions for major commercial
real estate transactions in Knoxville, Tennessee);
(ii) executed originals of the documents and other
deliveries listed in SECTION 13(A) above, except as provided in
(i) above; and
24
(iii) the balance, if any, in the escrow account to
the credit of Buyer by check or by wire transfer payable to
Buyer.
At Closing, Seller shall deliver, or cause its property manager to
deliver, to Buyer, to the extent in Seller's or property manager's possession,
the original executed copies of all Tenant Leases and Service Contracts, the
original plans and specifications for the Improvements, building permits,
certificates of occupancy, and such other certificates, licenses, and permits as
may relate to the operation of the Property, and the originals or photocopies of
all books, accounts, and records relating to the Property.
15. BREACH.
(a) If Buyer shall refuse or fail to consummate the
transaction that is the subject of this Agreement in violation of Buyer's
obligations hereunder, the Deposit shall be retained by Seller, as Seller's sole
and exclusive remedy, as liquidated and exclusive damages, and both parties
shall be relieved of and released from any further liability hereunder except
for those obligations which specifically survive termination. Seller and Buyer
acknowledge and agree that (a) it would be extremely difficult to accurately
determine the amount of damages suffered by Seller as a result of Buyer's
default hereunder; (b) the Deposit is a fair and reasonable amount to be
retained by Seller as agreed and liquidated damages for Buyer's default under
this Agreement; and (c) retention by Seller of the Deposit upon Buyer's default
hereunder shall not constitute a penalty or a forfeiture. As to any breach of
this Agreement by Buyer or Escrow Agent (other than refusal or failure to
consummate the transaction that is the subject of this Agreement), Seller shall
have the remedies available at law, equity, and as otherwise provided for by
this Agreement.
(b) If Seller shall refuse or fail to convey the Property to
Buyer in violation of Seller's obligations hereunder for any reason other than a
default by Buyer under this Agreement or otherwise be in breach of any other
material covenant herein contained (but excluding the failure or non-occurrence
of a condition to closing not involving default by Seller, including but not
limited to the Tenant Estoppel Condition), Buyer shall elect as its sole remedy
hereunder either (i) to terminate the Agreement and recover the Deposit and
Seller shall reimburse Buyer its out of pocket third party costs in connection
with this transaction up to a maximum of Two Hundred Thousand Dollars
($200,000.00), or (ii) to seek specific performance of Seller's obligation to
convey the Property pursuant to this Agreement, provided that in no event shall
Seller be obligated to undertake any of the following: (x) change the condition
of the Property or restore the same after fire or casualty; (y) except as
provided in SECTION 4(F) of this Agreement, expend money or post a bond to
remove or insure over a title defect or encumbrance or to correct any matter
shown on a survey of the Property; or (z) secure any permit, approval, waiver or
consent from any governmental authority with respect to the Property or Seller's
conveyance thereof. As to any breach of this Agreement by Seller other than
refusal or failure to convey the Property as required by this Agreement, Buyer
shall have the remedies available at law, equity, and as otherwise provided for
by this Agreement.
25
(c) If a dispute arises between Buyer and Seller as to the
right to receive the Deposit, Escrow Agent shall promptly institute an
interpleader action in a court located in Xxxx County, Tennessee and shall,
subject to the applicable statute, rules and/or order of the court, place the
Deposit with the Clerk of such court pending a resolution by the court as to
whether Buyer or Seller is entitled to receive the Deposit. In such proceeding,
the court may require a party that has taken an unreasonable position as to the
Deposit to pay the attorney's fees, costs, and expenses of the other party(ies).
If the Escrow Agent fails or refuses to promptly transfer the Deposit as
described above, Buyer or Seller shall be entitled to specifically enforce the
provisions of this SECTION 15(C) and Escrow Agent shall reimburse Buyer and
Seller for its attorney's fees, expenses and costs incurred in obtaining Escrow
Agent's compliance with the applicable provisions of this Agreement.
16. NO OUTSIDE REPRESENTATIONS/AS-IS SALE.
(a) This Agreement, including the Schedules attached hereto
and incorporated herein, contains all of the terms and conditions agreed upon,
it being understood that there are no outside representations or oral
agreements. Any modification of this Agreement shall be in writing and shall be
signed by Seller and Buyer.
(b) The Property is being sold in an "AS IS, WHERE IS"
condition and "WITH ALL FAULTS". Except for Seller's representations as set
forth in SECTION 8(A), if applicable, no representations or warranties, express,
implied or arising by operation of law, have been made or are made and no
responsibility has been or is assumed by Seller or by any partner, officer,
person, firm, agent, attorney, or representative acting or purporting to act on
behalf of Seller as to the condition or repair of the Property or the value,
expense of operation, or income potential thereof or as to any other fact or
condition which has or might affect the Property or the condition, repair,
value, expense of operation or income potential of the Property or any portion
thereof. Buyer acknowledges that it has and will thoroughly inspect and examine
the Property, directly and through agents of Buyer with expertise. Any and all
express and/or implied warranties are hereby disclaimed. The parties agree that
all understandings and agreements heretofore made between them or their
respective agents or representatives are merged in this Agreement and the
schedules and exhibits hereto annexed, which, along with any confidentiality
agreements or access agreements that have been or may be entered into between
the parties, alone fully and completely express their agreement, and that this
Agreement has been entered into after full investigation, or with the parties
satisfied with the opportunity afforded for investigation, neither party relying
upon any statement or representation by the other unless such statement or
representation is specifically embodied in this Agreement or such schedules or
exhibits. To the extent that Seller has provided to Buyer access or use of a
physical or electronic data room or internet site (any such form of access or
use referred to as "Data Room"), the Due Diligence Materials or information from
any inspection, engineering or environmental reports concerning asbestos or any
hazardous materials or harmful or toxic substances, except as set forth in
SECTION 8(A)(IX) of this Agreement, Seller makes no representations or
warranties with respect to the accuracy or completeness, methodology of
preparation or otherwise concerning the
26
contents of such Data Room, Due Diligence Materials or reports. Buyer
acknowledges that Seller has requested that Buyer inspect the Property fully and
carefully and investigate all matters relevant thereto and that Buyer relies
solely upon the results of Buyer's own inspections or other information obtained
or otherwise available to Buyer, rather than any information that may have been
provided by Seller to Buyer. Buyer expressly understands and acknowledges that
it is possible that unknown liabilities may exist with respect to the Property
and Buyer explicitly took that possibility into account in determining and
agreeing to the Purchase Price.
(c) The provisions of this SECTION 16 shall survive the
Closing and delivery of the Deed and shall not be merged thereby.
17. SURVIVABILITY. Except for the rights and obligations of Seller
and Buyer in SECTIONS 5, 7 (BUT ONLY AS TO A BREACH BY SELLER PRIOR TO THE
CLOSING DATE), 8, 12, 16, 19, 22 AND 29 of this Agreement and the obligations of
Buyer in SECTION 5 hereof, which by their express terms shall survive, none of
the rights and obligations of Buyer and Seller shall survive the Closing or the
termination of this Agreement.
18. NOTICES. All notices, requests, approvals, consents and other
communications required or permitted to be given or delivered under this
Agreement shall be in writing and shall be deemed validly given (a) immediately
upon hand delivery, (b) one (1) day following deposit with a courier or express
service guaranteeing overnight delivery, (c) three (3) postal delivery days
after deposit in the U.S. mails by certified mail, return receipt requested, or
(d) immediately upon the telephonically confirmed receipt of a facsimile
transmission, addressed as follows:
If to Seller: HPW Family Partnership, LLC
Xxxxxx Family Partnership, LLC
Riverview Partners, LLC
000 Xxxxx Xxx Xxxxxx
Xxxxx 0000 Xxxxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with copies to (which Xxxxxxx X. XxXxxxxx
alone shall not Xxxxxx, Xxxxxx & XxXxxxxx, P.C.
constitute notice): 000 Xxxxx Xxx Xxxxxx
Xxxxx 0000 Xxxxxxxxx Tower
Xxxxxxxxx, Xxxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
27
If to Buyer: Harvard Property Trust, LLC
00000 Xxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attention: Xxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with copies to: Xxxxxx & Xxxxxxx, L.L.P.
0000 X. Xxxxxxx Xxxxxxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
or to such other person or address as Seller or Buyer shall have given by notice
as herein provided.
19. BROKER'S COMMISSION. Except for a commission payable to Site
Systems, Inc., whose fees shall be paid by Buyer at Closing, and except for a
commission payable to Xxxxxx-Xxxx, LLC, whose fees shall be paid by Seller at
Closing, Seller and Buyer each represent and warrant to the other that the
warranting party has had no dealing with any other dealer, real estate agent, or
broker so as to entitle such other dealer, agent, or broker to receive any
commission or fee in connection with sale of the Property to Buyer. If for any
reason any such commission or fee shall become due, the party dealing with such
dealer, agent, or broker shall pay any such commission or fee and shall
indemnify, defend, and save the other party harmless from and against any and
all claims for any such commission or fee and from any attorneys' fees and
litigation or other expenses relating to any such claim. The provisions of this
SECTION 19 shall survive the Closing or termination of this Agreement.
20. BINDING EFFECT. This Agreement shall benefit and bind the
parties and the heirs, legal representatives, successors, and assigns of each of
them. It is specifically agreed that Buyer may assign its rights under this
Agreement to an Affiliate without the prior written consent of Seller, provided
that Buyer shall remain jointly and severally liable with the Affiliate for the
obligations, covenants and duties of Buyer pursuant to this Agreement. For
purposes of this SECTION 20, the term "Affiliate" shall mean: (a) an entity that
controls, is controlled by, or is under common control with Buyer; (b) any
partnership in which Buyer or Buyer's controlling member is the general partner;
(c) any fund or entity sponsored by Buyer; or (d) any entity that retains Buyer
or a company affiliated with Buyer to manage the Property.
21. SELLER'S LIMITED LIABILITY. It is expressly agreed that in no
event shall any member, manager, officer, director, employee, agent or
representative of Seller have any personal liability in connection with this
Agreement or the transaction envisioned herein. The provisions of this SECTION
21 shall survive the Closing or the termination of this Agreement.
28
22. SECTION HEADINGS. All section headings and other titles and
captions used in this Agreement are for convenience only, do not form a
substantive part of this Agreement, and shall not restrict or enlarge any
substantive provisions of this Agreement.
23. PRONOUNS. All pronouns and any variations thereof shall be
deemed to refer to the masculine, feminine, neuter, singular, or plural, as the
context and the identity of the person or persons may require.
24. AGREEMENT IN COUNTERPARTS. This Agreement may be executed in
counterparts and all such counterparts shall constitute one agreement binding on
all the parties, notwithstanding that all the parties are not signatories to the
same counterpart. Signatures to this Agreement transmitted by facsimile shall be
valid and effective to bind the party so signing.
25. GOVERNING LAW; VENUE. This Agreement shall be governed by the
laws of the State of Tennessee (without regard to the choice of law provisions
thereof). The exclusive venue for any dispute or proceeding arising in
connection with this Agreement and the transactions contemplated hereby shall be
the state or federal courts located in Xxxx County, Tennessee. Buyer (on its own
behalf and behalf of its agents, affiliates, officers, managers, and assignees)
and Escrow Agent irrevocably submit to the personal jurisdiction of such courts
and waives any objection or defense alleging the forum is inconvenient or
inappropriate.
26. TIME OF THE ESSENCE; FAILURE TO ENFORCE NOT A WAIVER. Time is of
the essence of this Agreement. Except as may be expressly provided in this
Agreement, failure by Seller or Buyer to enforce any right shall not constitute
a waiver thereof.
27. CALCULATION OF TIME PERIODS. Unless otherwise specified, in
computing any period of time described in this Agreement, the day of the act or
event after which the designated period of time begins to run is not to be
included and the last day of the period so computed is to be included, unless
such last day is a Saturday, Sunday or legal holiday under the laws of the State
of Tennessee or the State of Texas, in which event the period shall run until
the end of the next day which is neither a Saturday, Sunday or legal holiday.
For purposes of this Agreement, "Business Day" shall mean any day which is not a
Saturday, Sunday or legal holiday under the laws of the State of Tennessee or
the State of Texas.
28. SEVERABILITY. If any provision in this Agreement, or its
application to any person or circumstance, is held to be invalid or
unenforceable to any extent, that holding shall not affect the remainder of this
Agreement or the application of that provision to persons or circumstances other
than that to which it was held invalid or unenforceable.
29. PUBLIC DISCLOSURE/MARKETING.
(a) After Closing, either Seller or Buyer may issue a press
release to announce the occurrence of the Closing and the purchase of the
Property by Buyer, provided that such
29
press release does not disclose the economic terms hereof. The provisions of
this SECTION 29(A) shall survive the Closing.
(b) Up to and including the specified date of Closing, if
Buyer is not in breach of this Agreement, and provided that neither party has
elected to terminate this Agreement in accordance with its terms, Seller and its
employees, agents and representatives will not actively market for sale,
initiate, encourage the initiation by others of discussions or negotiations with
third parties or respond to solicitations by third persons relating to the sale
or other disposition of the Property. Seller may notify any potential purchaser
of the Property of the schedule applicable to this Agreement but Seller will not
enter into a "back-up" contract.
30. NO PARTNERSHIP. Nothing contained in this Agreement shall be
construed to create a partnership or joint venture between the parties or their
successors in interest.
31. NO RECORDATION. Neither this Agreement nor any memorandum or
short form thereof may be recorded by Buyer. A violation of this prohibition
shall constitute a material breach by Buyer of this Agreement.
[Signatures on following pages]
30
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first set forth at the beginning of this Agreement.
SELLER:
HPW Family Partnership, LLC,
a Tennessee limited liability company
By:_____________________________________
Xxxxx X. Xxxxx, Chief Manager
Xxxxxx Family Partnership, LLC,
a Tennessee limited liability company
By:_____________________________________
Xxxxxxx X. Xxxxxx, Chief Manager
Riverview Partners, LLC,
a Tennessee limited liability company
By:_____________________________________
Xxxxxxx X. Xxxxxx, Chief Manager
BUYER:
HARVARD PROPERTY TRUST, LLC,
a Delaware limited liability company
By:_____________________________________
Its:____________________________________
31
ACCEPTANCE OF ESCROW AND AGREEMENT
Receipt of an executed copy of the foregoing instrument is hereby
acknowledged, and the undersigned hereby agrees to act as Escrow Agent in
accordance with the foregoing Agreement and agrees to be bound by and subject to
the terms of the foregoing Agreement.
Dated: __________________
PARTNERS TITLE COMPANY
By: ________________________________
Name: __________________________
Title:__________________________
32
LIST OF SCHEDULES
Schedule 1(a) Legal Description of the Land
Schedule 1(c) Excluded Personal Property
Schedule 1(d) List of Tenant Leases
Schedule 1(e) List of Service Contracts
Schedule 5(b) Due Diligence Materials
Schedule 6 Form of Estoppel Certificate
Schedule 7(a) List of Pending Leases and/or Amendments
Schedule 8(a)(iii) Litigation
Schedule 8(a)(v)(C) Landlord Defaults
Schedule 8(a)(v)(D) Tenant Defaults
Schedule 8(a)(v)(E) Security Deposits
Schedule 8(a)(v)(F) Outstanding Tenant Improvement Obligations
Schedule 8(a)(vi)(C) Service Contract Defaults
Schedule 8(a)(ix) List of Environmental Reports
Schedule 8(a)(xii) Outstanding Leasing Commissions
Schedule 8(a)(xiii) Brokerage Agreements
Schedule 9(b)(iv) Form of management and exclusive leasing agreement with
Xxxxxx-Xxxx, LLC
Schedule 13(a)(i) Form of Deed
Schedule 13(a)(ii) Form of Xxxx of Sale
Schedule 13(a)(iii) Form of Assignment and Assumption of Leases
Schedule 13(a)(iv) Form of Assignment and Assumption of Service Contracts
and Intangible Property
Schedule 13(a)(vi) Form of Affidavit of Non-Foreign Status
Schedule 13(a)(vii) Form of Seller's Closing Certificate
Schedule 13(b)(v) Form of Buyer's Closing Certificate
33
SCHEDULE 1(a)
LEGAL DESCRIPTION
TRACT 1:
BEING a parcel of land located in the 1st Xxxx of the City of Knoxville,
Tennessee, and the 1st District of Xxxx County, Tennessee, and being a portion
of the city block bounded by Gay Street, Hill Avenue, State Street, and Main
Avenue, and being more particularly described as follows:
BEGINNING, at a set spike in asphalt at the intersection of the easterly right
of way of Gay Street and the southerly right of way of Main Avenue and being
approximately 2.5 feet west of the curb line;
THENCE, north 65 deg. 12 min. 00 sec. east 295.20 feet along the southerly right
of way of Main Avenue and along the northerly face of a wall to a set brass disc
with punch point, set in the sidewalk and at the intersection of the southerly
right of way of Main Avenue and the westerly right of way of State Street;
THENCE, south 24 deg. 49 min. 00 sec. east 258.94 feet along the westerly right
of way of State Street in the sidewalk to a point being north 24 deg. 49 min. 00
sec. east 24.00 feet from a set spike in asphalt;
THENCE, south 20 deg. 33 min. 00 sec. west 33.72 feet to a point on the
northerly right of way of Hill Avenue and being south 65 deg. 55 min. 00 sec.
west 24.00 feet from a set spike reference point;
THENCE, south 65 deg. 55 min. 00 sec. west 105.03 feet along the northerly right
of way of Hill Avenue and along the south face of a wall to a set spike in
asphalt;
THENCE, north 24 deg. 57 min. 00 sec. west 135.01 feet along the west face of a
wall along the common line with Aetna Casualty and Surety Company to a drill
point in concrete in the loading dock area of Riverview Tower;
THENCE, south 65 deg. 55 min. 00 sec. west 42.73 feet continuing with Aetna to a
set nail;
THENCE, north 24 deg. 30 min. 00 sec. west 20.15 feet continuing with Aetna to a
point;
THENCE, south 65 deg. 12 min. 00 sec. west 23.10 feet continuing with Aetna to a
point;
S-34
THENCE, north 24 deg. 48 min. 00 sec. west 41.50 feet continuing with Aetna to a
point beneath the Riverview Tower;
THENCE, south 65 deg. 12 min. 00 sec. west 100.00 feet continuing with Aetna to
a point on the curb of Gay Street on the easterly right of way of Gay Street;
THENCE, north 24 deg. 57 min. 00 sec. west 84.14 feet along the easterly right
of way of Gay Street and along the curb to the point of Beginning, as shown by
survey of Xxxx X. Xxxxx, R.L.S. Xx. 0000, Xxxxx 0000, Xxxxx Xxxxx, Xxxxxxxxx,
Xxxxxxxxx 00000, dated September 4, 1990, revised September 6, 1990, November
20, 1990, December 10, 1990, December 12, 1990, and December 22, 1990, File No.
12226-00.
TRACT II:
OVERHEAD PEDESTRIAN BRIDGE - LOCATED AS FOLLOWS:
TO FIND THE POINT OF BEGINNING, commence at a set spike in the Eastern right of
way of Gay Street at its intersection with the Southern right of way of Main
Avenue; thence North 65 deg. 12 min. 00 sec. East 139.80 feet to the POINT OF
BEGINNING; thence crossing Xxxx Xxxxxx, Xxxxx 00 deg. 48 min. 00 sec. West 65.72
feet to a point; thence North 65 deg. 12 min. 00 sec. East 11.34 feet to a
point; thence South 24 deg. 48 min. 00 sec. East 65.72 feet to a point in the
Southern right of way of Main Avenue; thence South 65 deg. 12 min. 00 sec. West
11.34 feet to the point of BEGINNING.
TRACT III:
EASEMENT:
That property identified on the survey of Xxxx X. Xxxxx, dated September 4,
1990, revised September 6, 1990, November 20, 1990, December 10, 1990, December
12, 1990, and December 22, 1990, as, "Tract 7", "Tract 8", and "Non-Exclusive
Easement W. D. 1997, page 305."
S-35
SCHEDULE 1(c)
EXCLUDED PERSONAL PROPERTY
Cash, securities, accounts (bank, deposit, escrow, reserve and otherwise), etc.
are NOT included in the definition of "Property"
S-36
SCHEDULE 1(d)
LIST OF TENANT LEASES
------------------------------------- --------------------------------------- -------------------------------------
NAME OF TENANT LEASE DOCUMENTS OTHER
-------------- --------------- -----
------------------------------------- --------------------------------------- -------------------------------------
Alcoa, Inc. Lease dated March 1, 1990; as amended Letter of Lease Termination for
by that First Amendment to Lease Suite 401 dated December 1, 1998
dated May 31, 1995; as amended by
that Second Amendment to Lease dated
March 7, 1997; as amended by that
Third Amendment to Lease dated
October 21, 1998; as amended by that
Fourth Amendment to Lease dated
December 29, 1998; as amended by that
Fifth Amendment to Lease dated
February 18, 1999; as amended by that
Sixth Amendment to Lease dated May
26, 2000; as amended by that Seventh
Amendment to Lease dated June 30,
2000; Memorandum Confirming Term
dated November 8, 2000; as amended by
that Eighth Amendment to Lease dated
November 30, 2001; as amended by that
Ninth Amendment to Lease dated May
21, 2002; as amended by that Tenth
Amendment to Lease dated December 5,
2002; as amended by that Eleventh
Amendment to Lease dated April 11,
2005
------------------------------------- --------------------------------------- -------------------------------------
Allegiant Management, LLC Lease dated October 5, 2004 Riverview Tower Parking Garage
Letter dated September 21, 2004;
Personal Guaranty dated October 5,
2004
------------------------------------- --------------------------------------- -------------------------------------
American Apartment Management, Inc. Lease dated January 9, 1989; as Riverview Tower Parking Garage
amended by that First Modification to Letter dated January 9, 1989
Lease dated November 7, 1989; as
amended by that Second Modification
to Lease dated April 5, 1994; as
amended by that Third Amendment to
Lease dated February 17, 1999
------------------------------------- --------------------------------------- -------------------------------------
S-37
------------------------------------- --------------------------------------- -------------------------------------
Baker, Donelson, Bearman, Xxxxxxxx Lease dated July 17, 1987; Memorandum
& Xxxxxxxxx, P.C. of Lease for Recording dated July 17,
1987; as amended by that First
Modification to Lease dated April 7,
1989; as amended by that Correction
First Modification of Lease dated
April 7, 1989; Memorandum of First
Modification of Lease for Recording
dated April 7, 1989; as amended by
that Second Amendment to Lease dated
July 1, 1997; as amended by that
Third Amendment to Lease dated
December 6, 2001; as amended by that
Fourth Amendment to Lease dated
February 28, 2003; Assignment of
Lease dated February 28, 2003; as
amended by the Fifth Amendment of
Lease dated June 22, 2005.
------------------------------------- --------------------------------------- -------------------------------------
Bass, Xxxxx & Xxxx PLC Lease dated March 29, 1991; as Riverview Tower Parking Garage
amended by that First Amendment to Letter dated March 29, 1991; Letter
Lease dated December 24, 1995; as of Agreement for Temporary Office
amended by that Second Amendment to Space dated January 4, 1991
Lease dated December 1, 2000; as
amended by that Third Amendment to
Lease dated April 27, 2004; as
amended by that Fourth Amendment to
Lease dated December 21, 2004
------------------------------------- --------------------------------------- -------------------------------------
Benefit Concepts of Connecticut, Lease dated August 25, 1997;
Inc. Memorandum Confirming Term dated
November 24, 1997; as amended by that
First Amendment to Lease dated August
25, 2000; as amended by that Second
Amendment to Lease dated July 24, 2003
------------------------------------- --------------------------------------- -------------------------------------
Branch Banking & Trust Company Lease dated May 20, 2003; as amended
by that First Amendment to Lease
dated December 1, 2003
------------------------------------- --------------------------------------- -------------------------------------
S-38
------------------------------------- --------------------------------------- -------------------------------------
Xxxxxxxx & Company, P.C. Lease dated June 30, 2005; Two Riverview Tower Parking Garage
Sublease Agreements dated July 1, 2005 Letter dated December 11, 1989
------------------------------------- --------------------------------------- -------------------------------------
Xxxxxxxxx, Xxxxxxx & Xxxxxxx, PLC Lease dated October 17, 2002; as Riverview Tower Parking Garage
amended by that First Amendment to Letter dated October 2, 2002;
Lease dated October 17, 2002 Letter of Release of Personal
Guaranty dated March 21, 2005
------------------------------------- --------------------------------------- -------------------------------------
Xxxxxxx X. Xxxxxxxxx & Xxxxx X. Lease dated October 14, 2003; as Personal Guaranty dated October 13,
Xxxxxxx amended by that First Amendment to 2003; Office Share Personal
Lease dated November 1, 2004 Guaranty dated December 12, 2003;
Riverview Tower Parking Garage
Letter dated October 13, 2003
------------------------------------- --------------------------------------- -------------------------------------
Corporate Legal Copy Service, LLC Lease dated June 29, 1998; Memorandum
Confirming Term dated December 2,
1999; as amended by that First
Amendment to Lease dated March 19,
2003;
------------------------------------- --------------------------------------- -------------------------------------
Xxxxxxx & Xxxxxx, P.C. Lease dated August 29, 2001; Storage Riverview Tower Parking Garage
Space Lease dated August 1, 2001 Letter dated August 29, 2001
------------------------------------- --------------------------------------- -------------------------------------
Egerton, XxXxxx, Xxxxxxxxx & Xxxxx, Lease dated October 14, 2002; as
P.C. amended by that First Amendment to
Lease dated September 3, 2003
------------------------------------- --------------------------------------- -------------------------------------
Xxxxxxxx & Xxxxxxx, P.C. Lease dated August 29, 2003 Riverview Tower Parking Garage
Letter dated August 28, 2003;
Personal Guaranty dated August 29,
2003
------------------------------------- --------------------------------------- -------------------------------------
Xxxxxx, Xxxxxx & XxXxxxxx, P.C. Lease dated February 11, 2002, as Riverview Tower Parking Garage
amended by that First Amendment to Parking Letter dated February 8,
Lease dated February 11, 2002, as 2002
amended by that Second Amendment to
Lease Agreement dated March 8, 2004;
as amended by that Third Amendment to
Lease Agreement dated September 1,
2005
------------------------------------- --------------------------------------- -------------------------------------
Xxxx Xx, Inc. Lease dated September 1, 1998; as
amended by that First Amendment to
Lease dated October 22, 1998; as
amended by that Second Amendment to
Lease dated October 10, 2003
------------------------------------- --------------------------------------- -------------------------------------
Xxxx Xxxxxx Agency, LLC Lease dated July 19, 2004 Riverview Tower Parking Garage
Letter dated July 19, 2004;
Personal Guaranty dated July 19,
2004
------------------------------------- --------------------------------------- -------------------------------------
S-39
------------------------------------- --------------------------------------- -------------------------------------
Xxxxxx, Xxxxx & Xxx, PLLC Lease dated December 5, 1003 Riverview Tower Parking Garage
Letter dated July 25, 2003
------------------------------------- --------------------------------------- -------------------------------------
Xxxxxx, Xxxx & Xxxxxxx Lease dated December 27, 1995; as
amended by that First Amendment to
Lease dated October 30, 1996; as
amended by that Second Amendment to
Lease dated April 1, 1997; as amended
by that Third Amendment to Lease
dated August 31, 2000; as amended by
that Fourth Amendment to Lease dated
December 5, 2003; as amended by that
Fifth Amendment to Lease dated August
23, 2005.
------------------------------------- --------------------------------------- -------------------------------------
Hunton & Xxxxxxxx Lease dated February 28, 1994; Riverview Tower Parking Garage
Storage Space Lease dated March 22, Letter dated February 28, 1994
1996; as amended by that First
Amendment to Lease dated May 17,
1999; as amended by that Second
Amendment to Lease dated August 1,
2003
------------------------------------- --------------------------------------- -------------------------------------
International Business Machines Lease dated April 12, 1991; as
Corporation amended by that First Amendment to
Lease dated September 26, 2001
------------------------------------- --------------------------------------- -------------------------------------
X.X. Xxxxxxx & Company, PC Lease dated October 3, 2002; as
amended by that First Amendment to
Lease dated October 14, 2002
------------------------------------- --------------------------------------- -------------------------------------
Xxxx, Xxxxxxx & Xxxxxxxx, P.C. Lease dated January 1, 2001; as Letter of Tenant Improvement
amended by that First Amendment to Allowance Reduction dated February
Lease dated February 13, 2002; as 20, 2002
amended by that Second Amendment to
Lease dated October 21, 2003; as
amended by that Third Amendment to
Lease dated May 10, 2005; Full
Termination of Lease dated July 14,
2005
------------------------------------- --------------------------------------- -------------------------------------
Xxxxxx-Xxxx, LLC Lease dated January 1, 2004; Storage
Space Lease dated October 5, 2004;
Storage Space Lease dated May 2, 2005
------------------------------------- --------------------------------------- -------------------------------------
S-40
------------------------------------- --------------------------------------- -------------------------------------
Xxxx & Xxxxxx Lease dated April 3, 1992; Storage
Space Lease dated July 31, 1992; as
amended by that First Modification to
Lease dated August 5, 1992; as
amended by that Second Amendment to
Lease dated July 22, 1997; as amended
by that Third Amendment to Lease
dated August 28, 2002
------------------------------------- --------------------------------------- -------------------------------------
Luedeka, Neely & Xxxxxx, P.C. Lease dated March 16, 1998; as
amended by the First Amendment to
Lease dated April 6, 2001; as amended
by that Second Amendment to Lease
dated September __, 2001; as amended
by that Third Amendment to Lease
dated September 20, 2002
------------------------------------- --------------------------------------- -------------------------------------
Moon Capital Management, LLC Lease dated August 28, 1995; as
amended by that First Amendment to
Lease dated April 29, 1998; as
amended by that Second Amendment to
Lease dated August 14, 1998; as
amended by that Third Amendment to
Lease dated August 22, 2003
------------------------------------- --------------------------------------- -------------------------------------
Providence LTC Advisors, Inc. Lease dated August 15, 2005
------------------------------------- --------------------------------------- -------------------------------------
Xxxxx Vending Company, Inc. Lease dated May 30, 1989; Assignment
of Lease dated June 28, 1991; as
amended by that First Amendment to
Lease dated August 26, 1999; as
amended by that Second Amendment to
Lease dated December 31, 1999; as
amended by that Third Amendment to
Lease dated December 1, 2000; as
amended by that Fourth Amendment to
Lease dated January 23, 2002; as
amended by that Fifth Amendment to
Lease dated October 8, 2003; as
amended by that Sixth Amendment to
Lease dated November 22, 2004
------------------------------------- --------------------------------------- -------------------------------------
Xxxxxxx & Xxxxx, PLLC Lease dated August 11, 2003 Riverview Tower Parking Garage
Letter date August 4, 2003;
Personal Guaranty dated August 11,
2003
------------------------------------- --------------------------------------- -------------------------------------
S-41
------------------------------------- --------------------------------------- -------------------------------------
Teleport Communications Group, Inc. Lease dated September 26, 1996;
Memorandum Confirming Term dated
November 24, 1997; as amended by that
First Amendment to Lease dated
September 4, 1998; Memorandum
Confirming Term dated March 1, 2000
------------------------------------- --------------------------------------- -------------------------------------
Xxxxxxx X. Xxxxx Lease dated May 23, 1991; Storage
Space Lease dated August 19, 1991; as
amended by that First Amendment to
Lease dated February 27, 1997; as
amended by that Second Amendment to
Lease dated May 7, 2002
------------------------------------- --------------------------------------- -------------------------------------
Xxxxxx & Hollow, PLC Lease dated October 23, 2002
------------------------------------- --------------------------------------- -------------------------------------
Woolf, McClane, Xxxxxx, Xxxxx & Lease dated December 16, 1994; Riverview Tower Parking Garage
Xxxxxxxxx, PLLC Storage Space Lease dated January 13, Letter dated December 16, 1994
1995; Storage Space Lease dated March
6, 1995; Storage Space Lease dates
September 1, 1996; as amended by that
First Amendment to Lease dated
December 30, 1996; as amended by that
Second Amendment to Lease dated
September 11, 1998; as amended by
that Third Amendment to Lease dated
March 30, 1999; Storage Space Lease
date June 22, 2004; as amended by
that Fourth Amendment to Lease dated
August 30, 2002
------------------------------------- --------------------------------------- -------------------------------------
S-42
SCHEDULE 1(e)
LIST OF SERVICE CONTRACTS
----------------------------------------------------------- ---------------------------------------------------------
NAME OF VENDOR SERVICE DOCUMENTS
----------------------------------------------------------- ---------------------------------------------------------
Central Parking System Contract dated June 14, 2001
----------------------------------------------------------- ---------------------------------------------------------
Absolute Services d/b/a Service Clean Contract dated June 21, 1999
----------------------------------------------------------- ---------------------------------------------------------
Xxxxx Associates Architects Contract dated November 1, 1999
----------------------------------------------------------- ---------------------------------------------------------
Xxxxxxxx Xxxxxx Industries Contract dated August 30, 2001; and Addendum dated
September 1, 2002
----------------------------------------------------------- ---------------------------------------------------------
Certified Generator Service Contract dated January 31, 2005
----------------------------------------------------------- ---------------------------------------------------------
Xxxxxxx Tree Specialists, Inc. Contract dated January 30, 2004
----------------------------------------------------------- ---------------------------------------------------------
Fyr-Fyter Sales & Service Co. Contract dated November 12, 1999
----------------------------------------------------------- ---------------------------------------------------------
Xxxxxxxx & Associates, Inc. Contract dated July 25, 2003
----------------------------------------------------------- ---------------------------------------------------------
Morristown Automatic Sprinkler Contract dated May 17, 1999
----------------------------------------------------------- ---------------------------------------------------------
Rentokil, Inc. (Initial Tropical Plants) Contract dated May 11, 2001
----------------------------------------------------------- ---------------------------------------------------------
Xxxxxxx'x Pest Control Contract dated May 17, 1999
----------------------------------------------------------- ---------------------------------------------------------
Sunstates Maintenance Corporation (GCA) Contract dated February 20, 2003
----------------------------------------------------------- ---------------------------------------------------------
ThyssenKrupp Elevator Contract dated March 12, 2002
----------------------------------------------------------- ---------------------------------------------------------
The Trane Company Contract dated January 1, 1999
----------------------------------------------------------- ---------------------------------------------------------
Volunteer Lawn, Inc. Contract dated December 30, 2003
----------------------------------------------------------- ---------------------------------------------------------
Xxxxxx Security, Inc. Contract dated October 4, 2004
----------------------------------------------------------- ---------------------------------------------------------
S-43
SCHEDULE 5(b)
DUE DILIGENCE MATERIALS
ADA Compliance, studies/reports
Advertising Agreements
Aerial Photos
Appraisal, Existing
Building/Capital Improvements Projects, Current
Building Measurement Surveys by Registered Architect
Building Permits
Building Plans, Specifications,
Paper
CADD Disk
Business Licenses
Capital Improvements, historical/projected, 3 years
Certificates of Occupancy:
Building
Tenants
CC&R's
Easement Information
Emergency/Life Safety Systems, Operating Manual
Environmental Site Assessment, Existing
Financial Items:
Aging Reports, Current and past 6 months
Balance Sheet, to date
Budget & Narrative, Current Year
Excess Operating Expenses Calculations - Current Year
Operating Expense Reconciliations (3 previous years)
Operating Statements for property, including a general ledger for each
year - 3 yrs
Rent Roll, Current
Security Deposit Listing, Current, LOC's/Guaranty's to be transferred
Flooding Info, Historical
Floor Plans, as leased
Geotechnical Report, if any
Ground Lease, if any
Insurance Certificate, Current, of Seller and Tenants
Insurance Claims, Pending
Insurance Claims History
Intellectual Property Documents, if any
Lease Commission Schedule, 3 previous years
S-44
Litigation - Pending
Management & Leasing Agreement - Existing
Occupancy/Vacancy History, 3 previous years
O & M Reports (Asbestos, Mold, etc.)
Parking Garage Lease/Operating Agreement
Parking Space Configuration (Surface and Garage if applicable)
Permits & Licenses - Alarm
Permits & Licenses - Construction
Permits & License - Elevator
Permits & License - Engineering
Personal Property Inventory including Office Equipment to remain on site
Photos of the Building
Property Condition Report, existing
Property Taxes land/improvements current year
Property Tax Statements, Personal, Current & Prior 3 yrs
Retail tenants, sales data and percentage rent buildings
Roof Reports
Security Incident Reports, for prior 24 months
Seismic Reports
Site Plans
Stacking Plan
Staffing/Payroll Schedule
Standard Form of Lease
Survey, existing
Tenant Contact Information
Tenant Financial Statements, if available
Tenant Improvement projects, currently under construction (copy of contract(s))
Tenant Improvement Schedule, 3 previous years
Title commitment policy of Seller, existing
Title Work - Preliminary
Title Work - Final
Utility Agreements
Utilities, prior 2 years/invoices/summary
Utility Security Deposits
Warranty, Elevator if applicable
Warranty, HVAC Equipment, if applicable
Warranty, Mechanical, if applicable
Warranty, Roof, if applicable
Website/Domain Information
Work Order Systems & Operating Manuals
Zoning Report, existing if available
S-45
SCHEDULE 6
FORM OF TENANT ESTOPPEL CERTIFICATE
[ADDRESS OF BUYER]
[ADDRESS OF LENDER]
RE: [Name and Address of Property]
Gentlemen:
Reference is made to that certain [LEASE AGREEMENT] dated as of
____________ __, ____ between ____________________________, a ____________, as
landlord ("LANDLORD"), and the undersigned, as tenant ("Tenant"), demising
premises at the captioned address more particularly described in the Lease (the
"PREMISES"). The lease, together with all amendments thereto included in
SCHEDULE 1 attached hereto, is herein referred to as the "LEASE". Tenant hereby
represents to the Benefited Parties (as herein defined) that the following
statements are true and correct as of the date hereof:
1. A true, correct and complete copy of the Lease (including all
amendments) is attached hereto as SCHEDULE 1. The undersigned is the Tenant
under the Lease for space at the Premises covering ___________ rentable square
feet.
2. The Lease is in full force and effect and has not been amended,
modified, supplemented or superseded except as indicated in Schedule 1. There
are no understandings, contracts, agreement or commitments of any kind
whatsoever with respect to the Premises, except as expressly provided in the
Lease.
3. The term of the Lease commenced on ________________, and expires
on _________________, subject to any rights of Tenant to extend the term as
provided therein. The base rent presently being charged is $__________. All
rentals, charges, additional rent and other obligations on the part of the
undersigned have been paid to and including ____________, 200_. No rental, other
than for the current month, has been paid in advance. The undersigned has
accepted possession and now occupies the Premises. In addition to the fixed
minimum Base Rent, the Tenant pays its pro-rata share of real estate taxes and
operating expenses in accordance with the terms of the Lease.
S-46
4. Tenant has paid to Landlord a security deposit in the amount of
$____________________. Tenant has no claim against Landlord for any other
security, rental, cleaning access card, key or other deposits or any prepaid
rentals.
5. Landlord is not in any respect in default in the performance of
the terms and provisions of the Lease, nor does any state of facts or condition
exist which, with the giving of notice or the passage of time, or both, would
result in such a default. All conditions under the Lease to be performed by
Landlord have been satisfied. Without limiting the generality of the foregoing,
all improvements to be constructed in the Premises by Landlord have been
completed to the satisfaction of Tenant and accepted by Tenant and any tenant
construction allowances have been paid in full, and all duties of an inducement
nature required of Landlord in the Lease have been fulfilled to Tenant's
satisfaction. Tenant has no claim against Landlord by reason of any restriction,
encumbrance or defect in title of the Premises of which Tenant has actual
knowledge.
6. There currently is no defense, offset, lien, claim or
counterclaim by or in favor of Tenant against Landlord under the Lease or
against the obligations of Tenant under the Lease (including, without
limitation, any rentals or other charges due or to become due under the Lease)
and Tenant is not contesting any such obligations, rentals or charges. To
Tenant's knowledge, all leasing commissions due in respect of the current term
of the Lease have been paid.
7. Tenant has no renewal, extension or expansion option, no right
of first offer or right of first refusal and no other similar right to renew or
extend the term of the Lease or expand the property demised thereunder except as
may be expressly set forth in the Lease. Tenant has no right to lease or occupy
any parking spaces within the Property except as set forth in the Lease. Tenant
is entitled to no free rent nor any credit, offsets or deductions in rent, nor
other leasing concessions other than those specified in the Lease.
8. Tenant is not in any respect in default in the performance of
the terms and provisions of the Lease nor does any state of facts or condition
exist which, with the giving of notice or the passage of time, or both, would
result in such a default. Without limiting the generality of the foregoing,
Tenant is current in its rental obligation under the Lease.
9. The undersigned has not received notice of a prior transfer,
assignment, hypothecation or pledge by Landlord of any of Landlord's interest in
the Lease other than to the holder of any first mortgage on the captioned
property.
10. There are no liens recorded against the Premises with respect to
work performed by or on behalf of Tenant or materials supplied to the demised
property.
11. Tenant has not assigned the Lease nor sublet all or any part of
the Premises, except as shown on Schedule 1 attached hereto and made a part
hereof for all purposes.
S-47
The above certifications are made to the Benefited Parties knowing that
the Benefited Parties will rely thereon in making an investment in the Premises.
For purposes hereof, the term "BENEFITED PARTIES" means the addressees of this
letter and all of the following: (a) Harvard Property Trust, LLC, a Delaware
limited liability company and its successors, assigns, and designees (including,
without limitation, any tenant in common purchasers); and (b) any lender to
which any party described in the foregoing clause (a) grants a deed of trust,
mortgage or other lien upon the Premises.
Very truly yours,
_____________________________,
a ____________________________
By:___________________________________
Name:_________________________________
Title:________________________________
S-48
JOINDER OF GUARANTOR
The undersigned joins in the execution of this Estoppel Certificate for
the purpose of confirming to and for the benefit of the Benefited Parties (a)
that the guaranty of Tenant's obligations under the Lease executed by the
undersigned remain in full force and effect, and (b) that the undersigned has no
defenses or offsets to its obligations under the guaranty of the Lease executed
by the undersigned. The undersigned understands that the Benefited Parties will
rely upon the foregoing confirmations.
_________________________________________
a _______________________________________
By:______________________________________
Name:____________________________________
Title:___________________________________
S-49
SCHEDULE 7(a)
PENDING NEW TENANT LEASES AND TENANT LEASE AMENDMENTS
------------------------------------------- ------------------ --------------------- ------------------
TENANT SQ. FT. DATE RENT
------------------------------------------- ------------------ --------------------- ------------------
Xxxxxx, Xxxx & Xxxxxxx 2,286.1 1/1/06 $16.50
Suite 1902 (Renewal)
------------------------------------------- ------------------ --------------------- ------------------
Federal Defender Services 10,400.1 12/1/05 $17.00
Suite 1800, 1801, 1810 & 1904
(New Lease)
------------------------------------------- ------------------ --------------------- ------------------
United Brotherhood of Carpenters 1,285.7 12/1/05 $19.80
Suite 2006 (New Lease)
------------------------------------------- ------------------ --------------------- ------------------
Robertson, Overbey, Xxxxxx & Xxxxxx 4,829.3 11/1/05 $16.25
Suite 703 (New Lease) 11/1/06 $16.75
11/1/07 $17.25
11/1/08 $17.75
11/1/09 $18.25
------------------------------------------- ------------------ --------------------- ------------------
Xxxxxx, Xxxx & Xxxxxxx (Suite 1902) - This is a one-year renewal.
Federal Defender Services (Suites 1800, 1801, 1810 & 1904) - This is a lease
proposal contingent upon the ability to relocate XX Xxxxxxx from Suite 1810 to
Suite 2006.
United Brotherhood of Carpenters (Suite 2006-partial) - This is a proposal for
1,285.7 rsf of the total 2,226.5 rsf available in this suite. This group is
awaiting decision by owner on the above possible relocation of XX Xxxxxxx.
Robertson, Overbey, Xxxxxx & Xxxxxx (Suite 703) - This law firm is relocating as
their existing building is being converted to residential condos.
S-50
SCHEDULE 8(a)(iii)
LITIGATION
August 2005 -
Riverview Partners, Xxxxxx-Xxxx, LLC and Branch Banking & Trust have been served
with a lawsuit by Mrs. Xxxxx Xxxxxxxx. Xxx. Xxxxxxxx injured her face when she
hit the glass upon exiting the revolving door (west entrance facing Gay Street).
She and her husband (Xxxxxx) are suing for $125,000.00.
S-51
SCHEDULE 8(a)(v)(C)
LANDLORD DEFAULTS
None
S-52
SCHEDULE 8(a)(v)(D)
TENANT DEFAULTS
OVER 90
SUITE TENANT NAME/NARRATIVE AMOUNT CURRENT 30-60 DAYS 60-90 DAYS DAYS
500 Teleport Communications 651.18 50.00 50.00 50.00 501.18
- operating expense & tax adjustments and late fees ($300) - payment scheduled for 8/29/05
ROOF NetStar Communications, Inc. 1,012.50 0.00 450.00 0.00 562.50
- delinquent rent for antenna on roof (billed quarterly)
TOTAL PROPERTY 1,663.68 50.00 500.00 50.00 1,063.68
S-53
SCHEDULE 8(a)(v)(E)
LIST OF SECURITY DEPOSITS
SUITE # TENANT NAME SECURITY DEPOSITS
600 Xxxxxxxxx Xxxxxxx & Xxxxxxx 14,369.74
705 Xxxxxxx & Xxxxx, PLLC Personal Guaranty from both attorneys
2,679.12 and a
1404 Xxxxxxxx & Xxxxxxx, P.C. Personal Guaranty from both attorneys
1501 Corporate, Legal Copy Svs. LLC 1,922.67
1502 Xxxxxxx X. Xxxxx 2,579.50
1,460.94 and
1704 Xxxx Xxxxxx Agency, LLC a Personal Guaranty
2,320.48 and a
1750 Xxxxxxx Xxxxxxxxx/Xxxxx Xxxxxxx Personal Guaranty from both attorneys
2103 Moon Capital Management LLC 2,894.06
2109 Xxxx XX, Inc. 1,448.00
899.00 and a
2305 Allegiant Management, LLC Personal Guaranty
TOTAL PROPERTY 30,573.51
S-54
SCHEDULE 8(a)(v)(F)
OUTSTANDING TENANT IMPROVEMENT OBLIGATIONS
CURRENT OUTSTANDING TENANT IMPROVEMENT ALLOWANCES
TENANT EXPIRATION DATE $ AMOUNT
Hunton & Xxxxxxxx 6/30/2006 $56,756.50
Xxxxxx Xxxxxx & XxXxxxxx 12/31/2008 $14,432.40
Xxxx Xxxxxxx & Xxxxxxxx 12/31/2005 $1,576.61
Moon Capital Mgmt 10/31/2010 $1,117.00
Corp Legal Copy Svc 8/31/2008 $4,462.50
Xxxxxxxx & Company 6/30/2010 $72,107.00
-------------------------
Total $150,452.01
PROPOSED TENANT IMPROVEMENT ALLOWANCES:
TENANT EXPIRATION DATE $ AMOUNT
Federal Defender Services 12/31/2010 $78,000.00
X.X. Xxxxxxx (relocation) 09/30/2007 $50,000.00
United Brotherhood of Carpenters 10/31/2010 $16,600.00
Robertson, Overbey, Xxxxxx & Xxxxxx 10/31/2010 $34,400.00
-------------------------
Total $179,000.00
S-55
SCHEDULE 8(a)(vi)(C)
SERVICE CONTRACT DEFAULTS
None
S-56
SCHEDULE 8(a)(ix)
LIST OF ENVIRONMENTAL REPORTS
Radon Abatement Final Report dated October 3, 1990
Phase I Environmental Survey dated December 12, 1990
Annual Environmental Report dated February 3, 1998
Underground Storage Tank Report dated April 21, 1998
Annual Environmental Report dated December 16, 1999
Annual Environmental Report dated October 31, 2000
S-57
SCHEDULE 8(a)(xii)
OUTSTANDING LEASING COMMISSIONS
TENANT DUE DATE $ AMOUNT
Xxxx, Xxxxxxx & Xxxxxxxx 1/1/2006 $13,833.19
Xxxxxx, Xxxx & Xxxxxxx 1/1/2006 $1,508.83
--------------------
Total $15,342.02
PROPOSED LEASE COMMISSIONS:
TENANT DUE DATE $ AMOUNT
Federal Defender Services 1/1/2006 $26,520.26
United Brotherhood of Carpenters 12/1/2005 $1,904.81
Robertson, Overbey, Xxxxxx & Xxxxxx 11/1/2005 $16,902.55
--------------------
Total $45,327.62
S-58
SCHEDULE 8(A)(XIII)
LEASING BROKERAGE AGREEMENT
--------------------------------------- ----------------------------------------
TYPE OF AGREEMENT DOCUMENTS
--------------------------------------- ----------------------------------------
Management & Leasing Agreement Contract effective as of January 1,
between Sellers and Xxxxxx-Xxxx, LLC 2001
--------------------------------------- ----------------------------------------
S-59
SCHEDULE 9(b)(iv)
FORM OF MANAGEMENT AND EXCLUSIVE LEASING AGREEMENT WITH XXXXXX-XXXX, LLC
PROPERTY MANAGEMENT AND LEASING SUBCONTRACT
This PROPERTY MANAGEMENT AND LEASING AGREEMENT SUBCONTRACT (this
"Agreement") is made and entered into as of the ___ day of ________, 2005, by
and between HPT MANAGEMENT SERVICES LP, a Texas limited partnership (the
"Manager"), and XXXXXX-XXXX, LLC, a Tennessee limited liability company (the
"Subcontractor").
RECITALS
A. ______________, a __________ ("Owner") has acquired the land
described on EXHIBIT A attached hereto together with the office building and
related facilities located thereon commonly known as Riverview Tower, having a
street address of 000 Xxxxx Xxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxx (the "Property");
X. Xxxxxxxxx Harvard REIT I, Inc., a Maryland corporation ("XX
XXXX"), Behringer Harvard Operating Partnership I LP, a Texas limited
partnership ("BH OP"), and Manager have entered into that certain Second Amended
and Restated Property Management and Leasing Agreement dated as of February 11,
2005 (the "Master Agreement"), pursuant to which XX XXXX and BH OP retained
Manager to manage and coordinate the leasing of certain properties acquired by
XX XXXX, BH OP or their Affiliates.
C. Owner is an Affiliate of XX XXXX and BH OP and has retained
Manager to manage and coordinate the leasing of the Property in accordance with
the terms of the Master Agreement.
D. Manager wishes to subcontract certain of its duties under the
Master Agreement in respect of the Property and Subcontractor wishes to perform
such duties and receive the fees and other consideration provided for herein;
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto, intending to be legally bound hereby, do
hereby agree, as follows:
ARTICLE I
DEFINITIONS
Except as otherwise specified or as the context may otherwise require,
the following terms have the respective meanings set forth below for all
purposes of this Agreement, and the definitions of such terms are equally
applicable both to the singular and plural forms thereof:
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1.1 "Affiliate" means, with respect to any Person, (i) any Person
directly or indirectly owning, controlling or holding, with the power to vote,
10% or more of the outstanding voting securities of such other Person; (ii) any
Person 10% or more of whose outstanding voting securities are directly or
indirectly owned, controlled or held, with the power to vote, by such other
Person; (iii) any Person directly or indirectly controlling, controlled by or
under common control with such other Person; (iv) any executive officer,
director, trustee or general partner of such other Person; and (v) any legal
entity for which such Person acts as an executive officer, director, trustee or
general partner.
1.2 "Gross Revenues" means all amounts actually collected as rents
or other charges for the use and occupancy of the Property, but shall exclude
parking fees, interest and other investment income of Owner and proceeds
received by Owner for a sale, exchange, condemnation, eminent domain taking,
casualty or other disposition of the Property.
1.3 "Improvements" means buildings, structures, equipment from time
to time located on the Property and all parking and common areas located on the
Property.
1.4 "Lease" means, unless the context otherwise requires, any lease
or sublease of the Property made by Owner as landlord or by its predecessor.
1.6 "Management Fees" has the meaning set forth in Section 5.1
hereof.
1.7 "Person" means an individual, corporation, association, business
trust, estate, trust, partnership, limited liability company or other legal
entity.
1.8 "Property" means the land described on EXHIBIT A attached hereto
and the office building and related facilities located thereon commonly known as
Riverview Tower, having a street address of 000 Xxxxx Xxx Xxxxxx, Xxxxxxxxx,
Xxxxxxxxx.
ARTICLE II
APPOINTMENT OF SUBCONTRACTOR; SERVICES TO BE PERFORMED
2.1 APPOINTMENT OF SUBCONTRACTOR. Manager hereby engages and retains
Subcontractor as the manager and leasing agent of the Property, and
Subcontractor hereby accepts such appointment on the terms and conditions
hereinafter set forth; it being understood that this Agreement shall cause
Subcontractor to be, at law, Manager's agent upon the terms contained herein.
2.2 GENERAL DUTIES. Subcontractor shall devote its best efforts to
performing its duties hereunder to manage, operate, maintain and lease the
Property in a diligent, careful and vigilant manner. The services of
Subcontractor are to be of scope and quality not less than those generally
performed by professional property managers of other similar properties in the
area. Subcontractor shall make available to Manager and Owner the full benefit
of the judgment, experience and advice of the members of Subcontractor's
organization and staff with respect to the policies to be pursued by Owner
relating to the operation and leasing of the Property.
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2.3 SPECIFIC DUTIES. Subcontractor's duties include the following:
(a) LEASE OBLIGATIONS. Subcontractor shall perform all
duties of the landlord under all Leases insofar as such duties relate to
operation, maintenance, and day-to-day management. Subcontractor shall
also provide or cause to be provided, at Owner's expense, all services
normally provided to tenants of like premises, including where
applicable normal repairs and maintenance, and cleaning, and janitorial
service. Subcontractor shall, as part of its duties under this
Agreement, perform the duties customarily performed by managers of
similar properties with respect to overseeing the construction of tenant
improvements in the Property, including specifically, without
limitation, review and approval of plans and specifications and general
coordination and supervision of such construction.
(b) MAINTENANCE. Subcontractor shall cause the Property to
be maintained in the same manner as similar properties in the area.
Subcontractor's duties and supervision in this respect shall include,
without limitation, cleaning of the interior and the exterior of the
Improvements and the public common areas on the Property and the making
and supervision of repair, alterations, and decoration of the
Improvements, subject to and in strict compliance with this Agreement,
the Master Agreement, and the Leases. Construction activities undertaken
by Subcontractor, if any, will be limited to activities related to the
management, operation, maintenance, and leasing of the Property (e.g.,
repairs, renovations, and leasehold improvements).
(c) LEASING FUNCTIONS. Subcontractor shall be the exclusive
leasing agent for the Property and shall coordinate the leasing of the
Property and shall negotiate and use its best efforts to secure executed
Leases from qualified tenants, and to execute same on behalf of Owner
(but only if requested to do so by Owner), for available space in the
Property, such Leases to be in form and on terms approved by Owner,
Manager and Subcontractor, and to bring about complete leasing of the
Property. Subcontractor shall be responsible for the hiring of all
leasing agents, as necessary for the leasing of the Property, and to
otherwise oversee and manage the leasing process on behalf of Owner.
(d) NOTICE OF VIOLATIONS. Subcontractor shall forward to
Manager and Owner promptly upon receipt all notices of violation or
other notices from any governmental authority, and board of fire
underwriters or any insurance company, and shall make such
recommendations regarding compliance with such notice as shall be
appropriate.
(e) PERSONNEL. Any personnel hired by Subcontractor to
maintain, operate and lease the Property shall be the employees or
independent contractors of Subcontractor and not of Manager or Owner.
Subcontractor shall use due care in the selection and supervision of
such employees or independent contractors. Subcontractor shall be
responsible for the preparation of and shall timely file all payroll tax
reports and timely make payments of all withholding and other payroll
taxes with respect to each employee.
(f) UTILITIES AND SUPPLIES. Subcontractor shall enter into
or renew contracts for electricity, gas, steam, landscaping, fuel, oil,
maintenance and other services as are customarily furnished or rendered
in connection with the operation of similar rental property in the area.
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(g) EXPENSES. Subcontractor shall analyze all bills received
for services, work and supplies in connection with maintaining and
operating the Property, pay all such bills when due, and, if requested
by Manager or Owner, pay, when due, utility and water charges, sewer
rent and assessments, and any other amount payable in respect to the
Property. All bills shall be paid by Subcontractor within the time
required to obtain discounts, if any, subject to available funding.
Manager or Owner may from time to time request that Subcontractor
forward certain bills to Manager or Owner promptly after receipt, and
Subcontractor shall comply with any such request. Subcontractor shall
pay all bills, assessments, real property taxes, insurance premiums and
any other amount payable in respect to the Property out of the Account
(as hereinafter defined). All expenses shall be billed at net cost
(i.e., less all rebates, commissions, discounts and allowances, however
designated).
(h) MONIES COLLECTED. Subcontractor shall use timely and
commercially reasonable efforts to collect all rent and other monies, in
the form of a check or money order, from tenants and any sums otherwise
due Owner with respect to the Property in the ordinary course of
business. Upon the request of Owner or Manager, Subcontractor shall
request, demand, collect and provide receipt for all such rent and other
monies and institute legal proceedings in the name of Owner for the
collection thereof and for the dispossession of any tenant in default
under its Lease.
(i) BANKING ACCOMMODATIONS. Subcontractor shall establish
and maintain a separate checking account (the "ACCOUNT") for funds
relating to the Property. All monies deposited from time to time in the
Account shall be deemed to be trust funds and shall be and remain the
property of Owner and shall be withdrawn and disbursed by Subcontractor
for the account of Owner only as expressly permitted by this Agreement
for the purposes of performing the obligations of Subcontractor
hereunder. No monies collected by Subcontractor on Owner's behalf shall
be commingled with funds of Subcontractor. The Account shall be
maintained, and monies shall be deposited therein and withdrawn
therefrom, in accordance with the following:
(i) All sums received from rents and other income from the
Property shall be promptly deposited by Subcontractor in
the Account. Subcontractor shall have the right to
designate two or more persons who shall be authorized to
draw against the Account, but only for purposes
authorized by this Agreement.
(ii) All sums due to Subcontractor hereunder, whether for
compensation, reimbursement for expenditures, or
otherwise, as herein provided, shall be a charge against
the operating revenues of the Property and shall be paid
and/or withdrawn by Subcontractor from the Account prior
to the making of any other disbursements therefrom.
(iii) By the fifteenth (15th) day after the end of each month,
Subcontractor shall forward to Owner all monies
contained in the Account other than a reserve of $5,000,
prepaid rent, and an amount sufficient to cover
expenditures provided for in the budget for that month,
which shall remain in the Account.
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(j) OWNERSHIP AGREEMENTS. If Owner provides Subcontractor
with an express summary of requirements set forth in the constituent
documents of Owner that pertain to the management and leasing of the
Property, Subcontractor shall use reasonable care to avoid any act or
omission that, in the performance of its duties hereunder, violates such
requirements.
(k) SIGNS. Subcontractor shall place and remove, or cause to
be placed and removed, such signs upon the Property as Subcontractor
deems appropriate, subject, however, to the terms and conditions of the
Leases and to any applicable ordinances and regulations.
2.4 APPROVAL OF LEASES, CONTRACTS, ETC. In fulfilling its duties to
Manager and Owner, Subcontractor may and hereby is authorized to enter into any
leases, contracts or agreements on behalf of Owner in the ordinary course of the
management, operation, maintenance and leasing of the Property; provided,
however, that any leases of the Property must be approved in writing by Owner.
2.5 ACCOUNTING, RECORDS AND REPORTS.
(a) RECORDS. Subcontractor shall maintain all office records and
books of account and shall record therein, and keep copies of, each invoice
received from services, work and supplies ordered in connection with the
maintenance and operation of the Property. Such records shall be maintained on a
double entry basis. Manager, Owner and persons designated by Manager or Owner
shall at all reasonable time have access to and the right to audit and make
independent examinations of such records, books and accounts and all vouchers,
files and all other material pertaining to the Property and this Agreement, all
of which Subcontractor agrees to keep safe, available and separate from any
records not pertaining to the Property, at a place recommended by Subcontractor
and approved by Manager and Owner. Subcontractor will use reasonable efforts to
cooperate with Manager, Owner, and any accountants retained by Manager or Owner,
with respect to the preparation of books and records relating to the Property,
any audit of such books and records, and financial reporting matters.
(b) MONTHLY REPORTS. On or before the 10th day after the end of each
month and during the term of this Agreement, Subcontractor shall prepare and
submit to Manager and Owner the following reports and statements:
(i) rental collection record;
(ii) monthly operating statement;
(iii) copy of cash disbursements ledger entries for such
period, if requested;
(iv) copy of cash receipts ledger entries for such period, if
requested;
(v) the original copies of all contracts entered into by
Subcontractor on behalf of Owner during such period, if
requested;
(vi) copy of ledger entries for such period relating to
security deposits maintained by Subcontractor, if requested; and
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(vii) Such other reports and statement as may be reasonably
requested by Owner or Manager.
(c) BUDGETS AND LEASING PLANS. Not later than November 15 of each
calendar year, Subcontractor shall prepare and submit to Manager and Owner for
approval an operating budget and a marketing and leasing plan with respect to
the Property for the calendar year immediately following such submission. The
budget and marketing and leasing plan shall be in the form of the budget and
plan approved by Owner prior to the date thereof. As often as reasonably
necessary during the period covered by any such budget, Subcontractor may submit
to Manager and Owner for approval an updated budget or plan incorporating such
changes as shall be necessary to reflect cost over-runs and the like during such
period. If neither Manager nor Owner disapproves any such budget within 30 days
after receipt thereof by Manager and Owner, such budget shall be deemed
approved. If Manager or Owner shall disapprove any such budget or plan, it shall
so notify Subcontractor within said 30-day period and explain the reasons
therefor. If Manager or Owner disapproves of any budget or plan, Subcontractor
shall submit a revised budget or plan, as applicable, within 10 days after
receipt of the notice of disapproval, and Manager and Owner shall have 10 days
to provide notice to Subcontractor if it disapproves of any such revised budget
or plan. Subcontractor will not incur any costs other than those estimated in
any budget except for:
(i) tenant improvements and real estate commissions required
under a Lease;
(ii) maintenance or repair costs not to exceed $5,000 per
item or occurrence;
(iii) costs incurred in emergency situations in which action
is immediately necessary for the preservation or safety of the
Property, or for the safety of occupants or other persons (or to
avoid the suspension of any necessary service of the Property),
as reasonably determined by Subcontractor under the
circumstances at such time;
(iv) expenditures for real estate taxes and assessment in
respect of the Property; and
(v) unbudgeted maintenance supplies calling for an aggregate
purchase price less than $25,000 per annum for the Property.
Budgets prepared by Subcontractor shall be for planning and informational
purposes only, and Subcontractor shall have no liability to Manager or Owner for
any failure to meet any such budget except as provided in Section 7.4(f) of this
Agreement. However, Subcontractor will use its best efforts to operate within
the approved budget.
(d) PERFORMANCE OF ACCOUNTING FUNCTION. Unless otherwise instructed
in writing by Owner, all accounting performed by Subcontractor in respect of the
Property shall be conducted on the computer system of Owner by means of remote
access software. Subcontractor acknowledges that an owner of direct or indirect
interests in Owner is a publicly registered entity and that it is of utmost
importance that Subcontractor perform accounting functions in respect of the
Property in an accurate and timely manner. Notwithstanding anything contained
herein to the contrary, in the event that more than two (2) times in any period
of twelve (12) consecutive months Subcontractor either (i) causes a material
inaccuracy to be present in any financial report prepared by Subcontractor in
respect of the Property, or (ii) fails to prepare and deliver to Owner any
report required by this Agreement in a timely manner, then Owner shall have
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the right, by written notice to Subcontractor, to relieve Subcontractor of its
accounting and reporting duties under this Agreement. In such event, the
Management Fees defined in Section 5.1 shall be reduced from three percent
(3.0%) of Gross Revenues to two percent (2%) of Gross Revenues.
(e) LEGAL REQUIREMENTS. Subcontractor shall execute and file when
due all forms, reports, and returns required by law relating to the employment
of its personnel. Subcontractor shall be responsible for notifying Manager and
Owner in the event it receives notice that any Improvement on the Property or
any equipment therein does not comply with the requirements of any statute,
ordinance, law or regulation of any governmental body or of any public authority
or official thereof having or claiming to have jurisdiction thereover.
Subcontractor shall promptly forward to Manager and Owner any complaints,
warnings, notices or summonses received by it relating to such matters.
Subcontractor is authorized to disclose the ownership of the Property by Owner
to any such officials. Owner is obligated to indemnify, protect, defend, save
and hold Subcontractor and its stockholders, officers, directors, employees,
members, governors, managers, successors and assigns (collectively, the
"Indemnified Parties") harmless of and from any and all Losses (as defined in
Section 3.5(a) hereof) that may be imposed on them or any or all of them by
reason of the failure of Owner to correct any present or future violation or
alleged violation of any and all present or future laws, ordinances, statutes,
or regulations of any public authority or official thereof, having or claiming
to have jurisdiction thereover, of which it has actual notice; provided,
however, that the foregoing indemnity shall not be applicable to any violation
of law caused by Subcontractor or any Affiliate of Subcontractor known by
Subcontractor or any Affiliate of Subcontractor prior to acquisition of the
Property by Owner.
ARTICLE III
AUTHORITY GRANTED TO SUBCONTRACTOR AND CERTAIN OWNER OBLIGATIONS
3.1 AUTHORITY AS TO TENANTS, ETC. Manager hereby delegates to
Subcontractor the following authority and powers (all of which shall be
exercised either in the name of Subcontractor, as manager of the Property, or in
the name of Owner entered into by Subcontractor as Owner's authorized agent, and
Owner shall assume all expenses in connection with such matters):
(a) to advertise the Property or any part thereof and to
display signs thereon, as permitted by law;
(b) to lease the Property to tenants;
(c) to pay all expenses of leasing the Property, including
but not limited to, newspaper and other advertising, signage, banners,
brochures, referral commissions, fees of attorneys approved by Manager,
leasing commissions, finder's fees and salaries, bonuses and other
compensation of leasing personnel responsible for the leasing of the
Property;
(d) to cause references of prospective tenants to be
investigated, it being understood and agreed by the parties hereto that
Subcontractor does not guarantee the creditworthiness or collectibility
of accounts receivable from tenants, users or lessees; and to negotiate
new Leases and renewals and cancellations of existing Leases that shall
be subject to the approval of Manager and Owner;
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(e) to charge tenants all or any of the following, subject
to the approval of Owner and Manager and in accordance with the terms of
the applicable Lease: a late rent administrative charge, a
non-negotiable check charge, credit report fee, a subleasing
administrative charge and/or broker's commission; and Subcontractor will
account for such charges and/or commission to Manager;
(f) to terminate tenancies at the Property and to sign and
serve in the name of Owner such notices as are deemed necessary by
Subcontractor;
(g) to institute and prosecute actions to evict tenants and
to recover possession of the Property or portions thereof;
(h) with the authorization of Manager and Owner, to xxx for
and in the name of Owner and recover rent and other sums due; and to
settle, compromise, and release such actions or suits, or reinstate such
tenancies. All expenses of litigation including, but not limited to,
attorneys' fees, filing fees, and court costs that Subcontractor shall
incur in connection with the collecting of rent and other sums, or to
recover possession of the Property or any portion thereof, shall be
deemed to be an operational expense of the Property. Subcontractor,
Manager and Owner shall concur on the selection of the attorneys to
handle such litigation.
3.2 OPERATIONAL AUTHORITY. Manager hereby delegates to Subcontractor
the following authority and powers (all of which shall be exercised either in
the name of Subcontractor, as manager of the Property, or in the name of Owner
entered into by Subcontractor as Owner's authorized agent, and Owner shall
assume all expenses in connection with such matters):
(a) to hire, supervise, discharge, and pay all labor
required for the operation and maintenance of the Property, including,
but not limited to, on-site personnel, managers, assistant managers,
leasing consultants, engineers, janitors, maintenance supervisors and
other employees required for the operation and maintenance of the
Property, including personnel spending a portion of their working hours
(to be charged on a pro rata basis) at the Property. All expenses of
such employment (and, if applicable, costs associated with the
termination of such employment) shall be deemed operational expenses of
the Property to the extent (i) set forth in an approved budget or
otherwise authorized by this Agreement, or (ii) incurred in an emergency
situation described in Section 2.5(c)(iii) above. However, it is
expressly agreed that expenses attributable to the manager, the
assistant manager and the administrative personnel supporting the
manager and the assistant manager (collectively, the "Management
Personnel") shall not be operational expenses of the Property and shall
not be reimbursable to Subcontractor.
(b) to make or cause to be made all ordinary repairs and
replacements necessary to preserve the Property in its present condition
and for the operating efficiency thereof and all alterations required to
comply with lease requirements, and to decorate the Property;
(c) to negotiate and enter into contracts for all items on
budgets that have been approved by Manager and Owner, any emergency
services, repairs for items not exceeding $5,000 per item or occurrence,
appropriate service agreements and labor agreements for normal
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operation of the Property, which have terms not to exceed three years,
and agreements for all budgeted maintenance, minor alterations, and
utility services, including, but not limited to, electricity, gas, fuel,
water, telephone, window washing, landscaping, snow removal, pest
exterminating, decorating and legal services in connection with the
Leases and service agreements relating to the Property, and other
services or such of them as Subcontractor may consider appropriate; and
(d) to purchase supplies and pay all bills.
Subcontractor shall use its best efforts to obtain the foregoing services and
utilities for the Property under terms that are as cost-effective and otherwise
favorable to Subcontractor as possible for the quality of services and utilities
required. Subcontractor is authorized to execute, as agent for Owner, all such
contracts. In addition, Owner agrees to specifically assume in writing all
obligations under all such contracts so entered into by Subcontractor, on behalf
of Owner, upon the termination of this Agreement, and Owner shall indemnify,
protect, save, defend and hold Subcontractor and the other Indemnified Parties
harmless from and against any and all Losses resulting from, arising out of or
in any way related to such contracts, but excluding matters arising out of
Subcontractor's negligence or misconduct. Subcontractor shall secure the
approval of Manager and Owner, and execution of appropriate contracts by, Owner
for any non-budgeted and non-emergency/contingency capital items, alterations or
other expenditures in excess of $5,000 for any one item, securing for each item
at least three written bids, if practicable, or providing evidence satisfactory
to Manager and Owner that the contract amount is lower than industry standard
pricing, from responsible contractors. Subcontractor shall not contract with or
make purchases from Affiliates of Subcontractor without the prior written
approval of Owner. Subcontractor may at any time and from time to time request
and receive the prior written authorization of Owner of the Property of any one
or more purchases or other expenditures, notwithstanding that Subcontractor may
otherwise be authorized hereunder to make such purchases or expenditures.
3.3 RENT AND OTHER COLLECTIONS. Manager hereby delegates to
Subcontractor the following authority and powers (all of which shall be
exercised either in the name of Subcontractor, as manager of the Property, or in
the name of Owner entered into by Subcontractor as Owner's authorized agent, and
Owner shall assume all expenses in connection with such matters): to collect
rents and/or assessments and other items, including but not limited to tenant
payments for real estate taxes, property liability and other insurance, damages
and repairs, common area maintenance, tax reduction fees and all other tenant
reimbursements, administrative charges, proceeds of rental interruption
insurance, parking fees, income from coin operated machines and other
miscellaneous income, due or to become due and give receipts therefor and to
deposit all such Gross Revenue collected hereunder in the Account. Subcontractor
may endorse any and all checks received in connection with the operation of any
Property and drawn to the order of Owner, and Owner shall, upon request, furnish
Subcontractor's depository with an appropriate authorization for Subcontractor
to make such endorsement. Subcontractor shall also have the authority to collect
and handle tenants' security deposits, including the right to apply such
security deposits to unpaid rent, and to comply, on behalf of Owner, with
applicable state or local laws concerning security deposits and interest
thereon, if any. Subcontractor shall not be required to advance any monies for
the care or management of the Property. Owner agrees to advance all monies
necessary therefor. If Subcontractor shall elect to advance any money in
connection with the Property, Owner agrees to reimburse Subcontractor forthwith
and hereby authorizes Subcontractor to deduct such advances from any monies due
Owner. In connection with any insured losses or damages relating to the
Property, Subcontractor
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shall have the authority to handle all steps necessary regarding any such claim;
provided that Subcontractor will not make any adjustments or settlements in
excess of $10,000 without the prior written consent of Manager and Owner.
3.4 PAYMENT OF EXPENSES. Manager hereby delegates to Subcontractor
the following authority and powers (all of which shall be exercised either in
the name of Subcontractor, as manager of the Property, or in the name of Owner
entered into by Subcontractor as Owner's authorized agent, and Owner shall
assume all expenses in connection with such matters): to pay all expenses of the
Property from the Gross Revenue collected in accordance with Section 3.3 above
and deposited in the Account. It is understood that the Gross Revenue will be
used first to pay the compensation to Manager and Subcontractor as contained in
Article 5 below, then operational expenses and then any mortgage indebtedness,
including real estate tax and insurance impounds, but only as directed by Owner
in writing and only if sufficient Gross Revenue is available for such payments.
Nothing in this Agreement shall be interpreted in such a manner as to obligate
Manager to pay from Gross Revenue any expenses incurred by Owner prior to the
commencement of this Agreement, except to the extent Owner advances additional
funds to pay such expenses.
3.5 CERTAIN INDEMNIFICATION OBLIGATIONS.
(a) IN GENERAL. Owner shall indemnify, protect, defend, save
and hold Subcontractor and all of the other Indemnified Parties harmless
from and against any and all claims, causes of action, demands, suits,
proceedings, loss, judgments, damage, awards, liens, fines, costs,
attorney's fees and expenses, of every kind and nature whatsoever
(collectively, "Losses"), that may be imposed on or incurred by
Subcontractor by reason of (i) the willful misconduct, gross negligence
and/or unlawful acts (such unlawfulness having been adjudicated by a
court of proper jurisdiction) of Owner, and (ii) breach of this
Agreement by Owner. Manager shall indemnify, protect, defend, save and
hold Subcontractor harmless from and against any and all Losses that may
be imposed on or incurred by Subcontractor by reason of (A) the willful
misconduct, gross negligence and/or unlawful acts (such unlawfulness
having been adjudicated by a court of proper jurisdiction) of Manager,
and (B) breach of this Agreement by Manager. Subcontractor shall
indemnify, protect, defend, save and hold Owner and Manager harmless
from and against any and all Losses that may be imposed on or incurred
by Owner or Manager by reason of (1) the willful misconduct, gross
negligence and/or unlawful acts (such unlawfulness having been
adjudicated by a court of proper jurisdiction) of Subcontractor, and (2)
breach of this Agreement by Subcontractor.
(b) PROPERTY DAMAGE, ETC. Owner agrees to indemnify, defend,
protect, save and hold Subcontractor and all of the other Indemnified
Parties harmless from any and all Losses in connection with or in any
way related to the Property and from liability for damage to the
Property and injuries to or death of any person whomsoever, and damage
to property; provided, however, that such indemnification shall not
extend to any such Losses arising out of the negligence or willful
misconduct of Subcontractor or any of the other Indemnified Parties.
Subcontractor shall not be liable for any error of judgment or for any
mistake of fact or law, or for any thing that it may do or refrain from
doing, except in cases of negligence or willful misconduct.
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3.6 ENVIRONMENTAL MATTERS. Owner hereby warrants and represents to
Subcontractor that to the best of Owner's knowledge, the Property will not be
used to treat, deposit, store, dispose of or place any hazardous substance that
may subject Subcontractor to liability or claims under the Comprehensive
Environmental Response, Compensation and Liability Act of 1980 (42 U.S.C.A.
Section 9607) or any constitutional provision, statute, ordinance, law, or
regulation of any governmental body or of any order or ruling of any public
authority or official thereof, having or claiming to have jurisdiction
thereover. Furthermore, Owner agrees to indemnify, protect, defend, save and
hold harmless Subcontractor and all of the other Indemnified Parties from any
and all Losses involving, concerning or in any way related to any future (but
not current or past) treatment, depositing, storage, disposal or placement by
any party other than Subcontractor of hazardous substances on the Property.
3.7 LEGAL STATUS OF PROPERTIES. Owner authorizes Subcontractor to
disclose the identity of the Owner of the Property to any governmental officials
and agrees to indemnify, protect, defend, save and hold Subcontractor and the
other Indemnified Parties harmless of and from any and all Losses that may be
imposed on them or any of them by reason of the failure of Owner to correct any
present or future violation or alleged violation of any and all present or
future laws, ordinances, statutes, or regulations of any public authority or
official thereof, having or claiming to have jurisdiction thereover, of which it
has actual notice; provided, however, that the foregoing indemnity shall not be
applicable to any violation of law caused by Subcontractor or any Affiliate of
Subcontractor known by Subcontractor or any Affiliate of Subcontractor prior to
acquisition of the Property by Owner. In the event it is alleged or charged that
any Improvement or any equipment on the Property or any act or failure to act by
Owner with respect to the Property or the sale, rental, or other disposition
thereof fails to comply with, or is in violation of, any of the requirements of
any constitutional provision, statute, ordinance, law, or regulation of any
governmental body or any order or ruling of any public authority or official
thereof having or claiming to have jurisdiction thereover, and Subcontractor, in
its sole and absolute discretion, considers that the action or position of
Owner, with respect thereto may result in damage or liability to Subcontractor,
Subcontractor shall have the right to cancel this Agreement at any time by
written notice to Owner of its election so to do, which cancellation shall be
effective upon the service of such notice. Such cancellation shall not release
the indemnities of Owner set forth in this Agreement and shall not terminate any
liability or obligation of Manager or Owner to Subcontractor for any payment,
reimbursement, or other sum of money then due and payable to Subcontractor
hereunder.
ARTICLE IV
EXPENSES
4.1 OWNER'S EXPENSES. Except as otherwise specifically provided, all
costs and expenses incurred hereunder by Subcontractor in fulfilling its duties
to Owner shall be for the account of and on behalf of Owner. Such costs and
expenses shall include the wages and salaries and other employee-related
expenses of all on-site and off-site employees of Subcontractor who are engaged
in the operation, management, maintenance and leasing or access control of the
Property (excluding the Management Personnel), including taxes, insurance and
benefits relating to such employees, and legal, travel and other out-of-pocket
expenses that are directly related to the management of the Property, to the
extent set forth in a budget approved by Owner and Manager. All costs and
expenses for which Owner is responsible under this Agreement shall be paid by
Subcontractor out of the Account. In the event the Account does
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not contain sufficient funds to pay all said expenses, Owner shall fund all sums
necessary to meet such additional costs and expenses.
4.2 SUBCONTRACTOR'S EXPENSES. Subcontractor shall, out of its own
funds, pay all of its general overhead and administrative expenses.
ARTICLE V
SUBCONTRACTOR'S COMPENSATION
5.1 MANAGEMENT FEES. Commencing on the date hereof, Owner shall pay
Subcontractor property management and leasing fees in an amount equal to three
percent (3.0%) of Gross Revenues (the "Management Fees") on a monthly basis from
the rental income received from the Property over the term of this Agreement. In
the event Subcontractor assists with planning and coordinating the construction
of any tenant-paid finish-out or improvements, Subcontractor shall be entitled
to receive from any such tenant (but not from Owner or Manager) an amount equal
to not greater than five percent (5.0%) of the cost of such tenant improvements.
Subcontractor will not be required to provide construction management services
(except as provided in Section 2.3(a) above) or provide tenant improvements on a
"turn-key" basis unless Owner or Manager retains Subcontractor to perform such
services pursuant to a separate written agreement.
5.2 LEASING FEES. In addition to the compensation paid to
Subcontractor under Section 5.1 above, Subcontractor shall be entitled to
receive a separate fee for the Leases of new tenants and renewals of Leases with
existing tenants in an amount not to exceed the fee customarily charged in arm's
length transactions by others rendering similar services in the same geographic
area for similar properties as determined by a survey of brokers and agents in
such area. The compensation to be paid to Subcontractor with respect to Leases
is set forth on EXHIBIT B attached hereto and made a part hereof.
5.3 AUDIT ADJUSTMENT. If any audit of the records, books or accounts
relating to the Property discloses an overpayment or underpayment of Management
Fees, Manager or Subcontractor shall promptly pay to the other party the amount
of such overpayment or underpayment, as the case may be. If such audit discloses
an overpayment of Management Fees for any fiscal year of more than five percent
(5%) of the correct Management Fees for such fiscal year, Subcontractor shall
bear the cost of such audit.
5.4 LIMITATION ON COMPENSATION. Notwithstanding anything contained
herein to the contrary, in no event shall Manager (or Owner) be obligated to pay
Subcontractor compensation under this Article V in excess of the compensation
that Manager is entitled to receive under Article V of the Master Agreement.
ARTICLE VI
INSURANCE AND INDEMNIFICATION
6.1 INSURANCE TO BE CARRIED. Subcontractor shall obtain and keep in
full force and effect, in accordance with the laws of the state of in which the
Property is located, employer's liability insurance
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applicable to and covering all employees of Subcontractor at the Property and
all persons engaged in the performance of any work required hereunder, and
Subcontractor shall furnish Manager and Owner certificates of insurers naming
Manager and Owner as a co-insured and evidencing that such insurance is in
effect. If Subcontractor maintains a policy of liability insurance,
Subcontractor shall cause Manager and Owner to be named as co-insureds on such
policy.
6.2 INSURANCE EXPENSES. Manager shall obtain and keep in full force
and effect insurance on the Property against such hazards as Owner and Manager
shall deem appropriate. Premiums and other expenses of such insurance, as well
as any applicable payments in respect of deductibles, shall be borne by Owner.
Owner or Manager, at its expense, shall maintain a policy of liability insurance
in respect of the Property and shall cause Subcontractor to be named as
co-insured on such policy.
6.3 COOPERATION WITH INSURERS. Subcontractor shall cooperate with
and provide reasonable access to the Property to representatives of insurance
companies and insurance brokers or agents with respect to insurance that is in
effect or for which application has been made. Subcontractor shall use its best
efforts to comply with all requirements of insurers.
6.4 ACCIDENTS AND CLAIMS. Subcontractor shall promptly investigate
and shall report in detail to Owner all accidents, claims for damage relating to
ownership, operation or maintenance of the Property, and any damage or
destruction to the Property and the estimated costs of repair thereof, and shall
prepare for approval by Manager and Owner all reports required by an insurance
company in connection with any such accident, claim, damage, or destruction.
Such reports shall be given to Manager and Owner promptly, and any report not so
given within 10 days after the occurrence of any such accident, claim, damage or
destruction shall be noted in the monthly operating statement delivered to
Manager and Owner pursuant to Section 2.5(b). With the written approval of
Manager, Subcontractor may settle any claim against an insurance company arising
out of any policy and, in connection with such claim, to execute proofs of loss
and adjustments of loss and to collect and receipt for loss proceeds.
6.5 INDEMNIFICATION. Owner will indemnify and hold Subcontractor
harmless against all liability for injury to persons and damage to property
caused by Owner's negligence and which did not result from the negligence or
misconduct of Subcontractor, except to the extent Subcontractor recovers
insurance proceeds with respect to such matter. Manager will indemnify and hold
Subcontractor harmless against all liability for injury to persons and damage to
property caused by Manager's negligence and which did not result from the
negligence or misconduct of Subcontractor, except to the extent Subcontractor
recovers insurance proceeds with respect to such matter. Subcontractor will
indemnify and hold Manager and Owner harmless against all liability for injury
to persons and damage to property caused by Subcontractor's negligence and which
did not result from the negligence or misconduct of Manager or Owner, except to
the extent Owner or Manager (as the case may be) recovers insurance proceeds
with respect to such matter.
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ARTICLE VII
TERM AND TERMINATION
7.1 TERM. This Agreement shall commence on the date first above
written and shall continue until the first (1st) anniversary of such date,
subject to the provisions of Sections 7.2, 7.3, 7.4 and 7.5 below.
7.2 RENEWAL OF TERM. If neither party has sent notice terminating
this Agreement as of the first (1st) anniversary of the date of this Agreement,
then this Agreement shall be automatically renewed for an additional one (1)
year term. If thereafter neither party sends notice terminating this Agreement,
then this Agreement shall likewise be automatically renewed for a one (1) year
term on each anniversary of the date of this Agreement.
7.3 EVENTS OF TERMINATION. Notwithstanding anything contained herein
to the contrary, this Agreement shall terminate upon (a) the sale of the
Property; (b) termination or expiration of the Master Agreement; (c) termination
of this Agreement as provided in SECTION 7.4 or SECTION 7.5 hereof; or (d)
termination of this Agreement by mutual written agreement of Manager and
Subcontractor.
7.4 TERMINATION BY MANAGER. Manager shall have the right to
terminate this Agreement upon written notice to Subcontractor upon the
occurrence of any of the following events:
(a) Subcontractor fails in any respect to perform a material
obligation under this Agreement and such failure is not cured (i) within five
(5) days after notice of such failure from Owner if the failure involves the
payment of money, or (ii) within thirty (30) days after notice of such failure
from Owner if the failure involves action other than the payment of money.
(b) Subcontractor files a petition or case seeking relief under the
liquidation provisions of any bankruptcy or other debtor relief laws of the
United States or any state or other competent jurisdiction.
(c) The occurrence of an event whereby (i) a petition or case is
filed against Subcontractor seeking relief under the bankruptcy, arrangement,
reorganization or other debtor relief laws of the United States or any state or
other competent jurisdiction, or (ii) a court of competent jurisdiction enters
an order, judgment or decree appointing a receiver or a trustee for
Subcontractor, or for all or any part of the property of Subcontractor, and such
petition, order, judgment or decree is not discharged within one hundred eighty
(180) days after the entry thereof.
(d) Subcontractor fails to provide to Manager within fifteen (15)
days after request by Manager customary, reasonable and truthful certifications
as Manager may reasonably request to enable Manager or Owner to meet its
financial certification obligations under the Xxxxxxxx-Xxxxx Act of 2002 as such
statute relates to financial reporting in respect of the Property. Any such
certification may be given by Subcontractor to its actual knowledge without any
duty of investigation.
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(e) Subcontractor experiences a "Change of Control." "Change of
Control" shall mean an event or a series of related events wherein the
Subcontractor ceases to be directly or indirectly controlled by one or more of
Xxxxxx Partners, LLC or Wood Partners, LLC.
(f) If in any two consecutive calendar quarters the Property fails
to achieve the gross revenues or net operating income set forth in respect of
such quarter in EXHIBIT C attached hereto, it being understood and agreed that
Owner, Manager and Subcontractor shall, in good faith, update and amend EXHIBIT
C annually in connection with the annual budget approval process in respect of
the Property.
7.5 TERMINATION BY SUBCONTRACTOR. Subcontractor shall have the right
to terminate this Agreement upon written notice to Manager and Owner upon the
occurrence of any of the following events:
(a) Manager or Owner fails in any respect to perform a material
obligation under this Agreement (i) within five (5) days after notice of such
failure from Subcontractor if the failure involves the payment of money, or (ii)
within thirty (30) days after notice of such failure from Subcontractor if the
failure involves action other than the payment of money.
(b) Manager or Owner files a petition or case seeking relief under
the liquidation provisions of any bankruptcy or other debtor relief laws of the
United States or any state or other competent jurisdiction.
(c) The occurrence of an event whereby (i) a petition or case is
filed against Manager or Owner seeking relief under the bankruptcy, arrangement,
reorganization or other debtor relief laws of the United States or any state or
other competent jurisdiction, or (ii) a court of competent jurisdiction enters
an order, judgment or decree appointing, without the consent of Manager or
Owner, a receiver or a trustee for Manager or Owner, as the case may be, or for
all or any part of their respective property, and such petition, order, judgment
or decree is not discharged within one hundred eighty (180) days after the entry
thereof.
7.6 SUBCONTRACTOR'S OBLIGATIONS UPON TERMINATION. Upon the
termination of this Agreement, Subcontractor shall have the following duties:
(a) Subcontractor shall deliver to Manager or its designee, all
books and records with respect to the Property.
(b) Subcontractor shall transfer and assign to Manager, or its
designee, all service contracts and personal property relating to or used in the
operation and maintenance of the Property, except personal property paid for and
owned by Subcontractor. Subcontractor shall also, for a period of sixty (60)
days immediately following the date of such termination, make itself available
to consult with and advise Manager, or its designee, regarding the operation,
maintenance and leasing of the Property.
(c) Subcontractor shall render to Manager an accounting of all funds
of Owner in its possession and shall deliver to Manager a statement of all
Management Fees claimed to be due to Subcontractor and shall cause funds of
Owner held by Subcontractor relating to the Property to be paid to Manager or
its designee.
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7.7 MANAGER'S OBLIGATIONS UPON TERMINATION. Manager shall pay or
reimburse Subcontractor for any sums of money due it under this Agreement for
services and expenses prior to termination of this Agreement. All provisions of
this Agreement that require Owner or Manager to have insured, or to protect,
defend, save, hold and indemnify or to reimburse Subcontractor shall survive any
expiration or termination of this Agreement and, if Subcontractor is or becomes
involved in any claim, proceeding or litigation by reason of having been
Subcontractor hereunder, such provisions shall apply as if this Agreement were
still in effect.
ARTICLE VIII
MISCELLANEOUS
8.1 SUBJECT TO MASTER AGREEMENT. This Agreement is subject and
subordinate in all respects to the Master Agreement. Subcontractor has received
a copy of the Master Agreement and is familiar with the terms thereof.
Subcontractor shall perform its duties under this Agreement in accordance with
the Master Agreement and will not, by its act or omission to act, cause a
default under the Master Agreement.
8.2 NOTICES. All notices, approvals, consents and other
communications hereunder shall be in writing, and, except when receipt is
required to start the running of a period of time, shall be deemed given when
delivered in person or on the fifth day after its mailing by either party by
registered or certified United States mail, postage prepaid and return receipt
requested, to the other party, at the addresses set forth after their respect
name below or at such different addresses as either party shall have theretofore
advised the other party in writing in accordance with this Section 8.2.
Manager: HPT MANAGEMENT SERVICES LP
00000 Xxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attention: Chief Legal Officer
Owner: _______________________________
c/o Behringer Harvard REIT I, Inc.
00000 Xxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attention: Chief Legal Officer
Subcontractor: Xxxxxx-Xxxx, LLC
000 Xxxxx Xxx Xxxxxx
Xxxxx 0000 Xxxxxxxxx Tower
Knoxville, Tennessee 37902
With copy to Xxxxxxx X. XxXxxxxx, Esq.
Xxxxxx, Xxxxxx & XxXxxxxx, P.C.
X.X. Xxx 0000
Xxxxxxxxx, Xxxxxxxxx 00000
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8.3 GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of Tennessee.
8.4 ASSIGNMENT. Subcontractor may not assign or delegate its duties
and rights under this Agreement without the prior written consent of Manager and
Owner. This Agreement shall be binding upon and shall inure to the benefit of
the parties hereto and their respective successors and assigns.
8.5 NO WAIVER. The failure of Manager, Subcontractor or Owner to
seek redress for violation or to insist upon the strict performance of any
covenant or condition of this Agreement shall not constitute a waiver thereof
for the future.
8.6 AMENDMENTS. This Agreement may be amended only by an instrument
in writing signed by the party against whom enforcement of the amendment is
sought.
8.7 HEADINGS. The headings of the various subdivisions of this
Agreement are for reference only and shall not define or limit any of the terms
or provisions hereof.
8.8 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, and it shall not be
necessary in making proof of this Agreement to produce or account for more than
one such counterpart.
8.9 ENTIRE AGREEMENT. This Agreement contains the entire
understanding and all agreements between Manager and Subcontractor respecting
the management of the Property. There are no representations, agreements,
arrangements or understandings, oral or written, between Manager and
Subcontractor relating to the management of the Property that are not fully
expressed herein.
8.11 DISPUTES. If there shall be a dispute between or among Manager,
Subcontractor or Owner relating to this Agreement resulting in litigation, the
prevailing party in such litigation shall be entitled to recover from the other
party to such litigation such amount as the court shall fix as reasonable
attorneys' fees.
8.12 ACTIVITIES OF SUBCONTRACTOR. Owner and Manager acknowledge that
Subcontractor manages and is otherwise involved with other properties and
ventures that are in competition with the business of Owner at the Property.
However, Subcontractor agrees that it will not solicit any tenant of the
Property to move into another building in the downtown area of Knoxville,
Tennessee.
8.13 INDEPENDENT CONTRACTOR. Subcontractor shall not be construed as
a joint venturer or partner of either Manager or Owner pursuant to this
Agreement, and none of such parties shall have the power to bind or obligate the
other party except as set forth herein. It is the intent of the parties that:
(a) the status of Manager to Owner under the Master Agreement is that of an
independent contractor; (b) the status of Subcontractor to Manager under this
Agreement is that of an independent contractor; and (c) the status of
Subcontractor to Owner is that of an independent subcontractor.
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8.14 NO THIRD-PARTY RIGHTS. Nothing expressed or referred to in this
Agreement will be construed to give any Person other than the parties to this
Agreement any legal or equitable right, remedy or claim under or with respect to
this Agreement or any provision of this Agreement, except such rights as shall
inure to a successor or permitted assignee pursuant to Section 8.4.
8.15 DOCUMENTS REQUIRED BY LENDER. In the event that a mortgagee of
the Property (a "Mortgagee") requests that Subcontractor execute a document in
connection with a loan to Owner, Subcontractor will respond to such request
promptly and will not unreasonably withhold its consent to such document.
Without limiting the generality of the preceding sentence, Subcontractor agrees
that it will execute and deliver the following documents within five (5) days
after request therefor: (a) an agreement that a Mortgagee may terminate this
Agreement if a default occurs in respect of the loan secured by the Property;
(b) an estoppel certificate certifying that this Agreement is in full force and
effect and containing such other certifications as may be reasonably requested;
(c) an agreement subordinating this Agreement to any mortgage or deed or trust
held by a Mortgagee; and (d) a waiver by Subcontractor of any right to assert a
lien against the Property. Subcontractor shall use reasonable care to avoid any
act or omission that, in the performance of its duties hereunder, shall in any
way conflict with the terms of any mortgage documents in respect of the
Property, provided that Subcontractor has been furnished with copies of such
mortgage documents.
8.16 COMPLIANCE AMENDMENTS. Notwithstanding anything contained herein
to the contrary, in the event that legal counsel for Owner reasonably determines
that an amendment to this Agreement is necessary or advisable in order for this
Agreement to comply with applicable securities laws, the offering documents
pertaining to Behringer Harvard REIT I, Inc., a Maryland corporation, or the
Statement of Policy Regarding Real Estate Programs of the North American
Securities Administrators Association, Inc., effective September 29, 1993, as
amended, then Manager and Subcontractor shall, within ten (10) days after
request from Owner, execute such an amendment; provided, however, that no such
amendment may decrease the compensation to which Subcontractor is entitled
hereunder or materially increase Subcontractor's liabilities or obligations
under this Agreement without Subcontractor's written consent.
[THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties have executed this Property Management
and Leasing Subcontract as of the date first above written.
MANAGER:
HPT MANAGEMENT SERVICES LP,
a Texas limited partnership
By: IMS, LLC, Its General Partner
By: _______________________________
Xxxxxx X. Xxxxxxx, III
Executive Vice President
SUBCONTRACTOR:
XXXXXX-XXXX, LLC, a Tennessee limited
liability company
By: _____________________________________
Xxxxxxx X. Xxxxxx, Chief Manager
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CONSENT AND AGREEMENT OF OWNER
By its execution below, Owner consents to the terms of the foregoing
Agreement and agrees to be bound by the representations, warranties and
covenants of Owner contained in such Agreement.
______________________________________
By:_________________________________
Name:_______________________________
Title:______________________________
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EXHIBIT A
Legal Description
TRACT 1:
BEING a parcel of land located in the 1st Xxxx of the City of Knoxville,
Tennessee, and the 1st District of Xxxx County, Tennessee, and being a portion
of the city block bounded by Gay Street, Hill Avenue, State Street, and Main
Avenue, and being more particularly described as follows:
BEGINNING, at a set spike in asphalt at the intersection of the easterly right
of way of Gay Street and the southerly right of way of Main Avenue and being
approximately 2.5 feet west of the curb line;
THENCE, north 65 deg. 12 min. 00 sec. east 295.20 feet along the southerly right
of way of Main Avenue and along the northerly face of a wall to a set brass disc
with punch point, set in the sidewalk and at the intersection of the southerly
right of way of Main Avenue and the westerly right of way of State Street;
THENCE, south 24 deg. 49 min. 00 sec. east 258.94 feet along the westerly right
of way of State Street in the sidewalk to a point being north 24 deg. 49 min. 00
sec. east 24.00 feet from a set spike in asphalt;
THENCE, south 20 deg. 33 min. 00 sec. west 33.72 feet to a point on the
northerly right of way of Hill Avenue and being south 65 deg. 55 min. 00 sec.
west 24.00 feet from a set spike reference point;
THENCE, south 65 deg. 55 min. 00 sec. west 105.03 feet along the northerly right
of way of Hill Avenue and along the south face of a wall to a set spike in
asphalt;
THENCE, north 24 deg. 57 min. 00 sec. west 135.01 feet along the west face of a
wall along the common line with Aetna Casualty and Surety Company to a drill
point in concrete in the loading dock area of Riverview Tower;
THENCE, south 65 deg. 55 min. 00 sec. west 42.73 feet continuing with Aetna to a
set nail;
THENCE, north 24 deg. 30 min. 00 sec. west 20.15 feet continuing with Aetna to a
point;
THENCE, south 65 deg. 12 min. 00 sec. west 23.10 feet continuing with Aetna to a
point;
THENCE, north 24 deg. 48 min. 00 sec. west 41.50 feet continuing with Aetna to a
point beneath the Riverview Tower;
THENCE, south 65 deg. 12 min. 00 sec. west 100.00 feet continuing with Aetna to
a point on the curb of Gay Street on the easterly right of way of Gay Street;
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THENCE, north 24 deg. 57 min. 00 sec. west 84.14 feet along the easterly right
of way of Gay Street and along the curb to the point of Beginning, as shown by
survey of Xxxx X. Xxxxx, R.L.S. Xx. 0000, Xxxxx 0000, Xxxxx Xxxxx, Xxxxxxxxx,
Xxxxxxxxx 00000, dated September 4, 1990, revised September 6, 1990, November
20, 1990, December 10, 1990, December 12, 1990, and December 22, 1990, File No.
12226-00.
TRACT II:
OVERHEAD PEDESTRIAN BRIDGE - LOCATED AS FOLLOWS:
TO FIND THE POINT OF BEGINNING, commence at a set spike in the Eastern right of
way of Gay Street at its intersection with the Southern right of way of Main
Avenue; thence North 65 deg. 12 min. 00 sec. East 139.80 feet to the POINT OF
BEGINNING; thence crossing Xxxx Xxxxxx, Xxxxx 00 deg. 48 min. 00 sec. West 65.72
feet to a point; thence North 65 deg. 12 min. 00 sec. East 11.34 feet to a
point; thence South 24 deg. 48 min. 00 sec. East 65.72 feet to a point in the
Southern right of way of Main Avenue; thence South 65 deg. 12 min. 00 sec. West
11.34 feet to the point of BEGINNING.
TRACT III:
EASEMENT:
That property identified on the survey of Xxxx X. Xxxxx, dated September 4,
1990, revised September 6, 1990, November 20, 1990, December 10, 1990, December
12, 1990, and December 22, 1990, as, "Tract 7", "Tract 8", and "Non-Exclusive
Easement W. D. 1997, page 305."
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EXHIBIT B
Leasing Commissions
A. For all new leases, lease renewals and lease expansions, except
as specified in Paragraphs B or C below, the Annual Base Rent specified on the
Reference Page of the lease minus the sum of (i) the amortized cost of any
tenant improvements paid for by Owner if the cost of such improvements is in
excess of the applicable building standard and is included in Base Rent and (ii)
the amortized cost of any concession(s) given to the prospective tenant;
multiplied by the lesser of (x) the number of years in the original term of the
lease and (y) ten (10) years, prorated for any partial year; multiplied by four
percent (4%).
B. In the event of the exercise of an option to renew or expand
contained in the lease in favor of the tenant: (i) for any lease executed during
the term of this Agreement, upon the exercise of such options, whether or not
such exercise occurs during the term of this Agreement; or (ii) for any lease
executed prior to the term of this Agreement where the exercise of the option
occurs during the term of this Agreement, in either case a leasing commission
equal to two percent (2%) of the Annual Base Rent for the renewal term or the
expansion premises, as the case may be. In the event that an outside broker is
involved, the commission shall be split equally between Subcontractor and the
outside broker, so that each receives one percent (1%).
C. In the event of a new lease, lease renewal not governed by
Paragraph B above or lease expansion where an outside broker is involved, the
leasing commission shall be equal to the Annual Base Rent specified on the
Reference Page of the lease, minus the sum of (i) the amortized cost of any
tenant improvements paid for by Owner if the cost of such improvements is in
excess of the applicable building standard and is included in base Rent and (ii)
the amortized cost of any concession(s) given to the prospective tenant;
multiplied by the lesser of (x) the number of years in the original term of the
lease and (y) ten (10) years, prorated for any partial year; multiplied by six
percent (6%) with one-half of such commission being paid to Subcontractor and
one-half being paid to the outside broker.
D. In the event any existing lease which does not contain an option
to renew or extend is renewed or extended during the term of this Agreement, the
leasing commission shall be equal to the commission set forth in Paragraph A
above.
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EXHIBIT C
Revenue Projections
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SCHEDULE 13(a)(i)
FORM OF SPECIAL WARRANTY DEED
======================================== ===================================== =====================================
Address New Owner: Map-Parcel Numbers: Send Tax Bills To:
---------------------------------------- ------------------------------------- -------------------------------------
--------------------------------------------------------------------------------------------------------------------
This instrument prepared by: ________________________________________________
====================================================================================================================
SPECIAL WARRANTY DEED
FOR AND IN CONSIDERATION of the sum of ______________
________________________and __/100 DOLLARS ($_________) cash in hand paid, and
other good and valuable consideration, the receipt and sufficiency of all of
which are hereby acknowledged, ____________________________ (the "Grantor") has
bargained and sold, and by these presents transfers and conveys to _____________
(the "Grantee"), Grantee's (heirs) (successors) and assigns, certain land in
_____________ County, State of Tennessee, being more particularly described in
Exhibit A, which is attached hereto and incorporated herein by reference (the
"Property").
This conveyance of the Property, and all covenants and warranties
contained herein, are made expressly subject to the following:
1. Real estate taxes for the current year which have been prorated
between the parties.
2. ________________________________________________________________
_______________________________________________________________________.
This is (improved) (unimproved) property, known as _____________________
_______________________________________________________________________.
[If the Grantor knows there is a gravesite, add the following: Pursuant
to T.C.A. ss.46-8-103, Grantor hereby discloses that a gravesite or crypt
containing human remains is located on the Property.]
TO HAVE AND TO HOLD the Property, with all appurtenances, estate, title,
and interest thereto belonging to the Grantee, Grantee's (heirs) (successors)
and assigns, forever.
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Grantor covenants with the Grantee that the Property is free from all
encumbrances made or suffered by Grantor, except to the extent otherwise set
forth herein.
Grantor further covenants and binds _________, to warrant and forever
defend the title to the Property to the Grantee, Grantee's (heirs) (successors)
and assigns against the lawful claims of all persons whomsoever claiming by,
through or under Grantor, except that no warranty is made as to the amount of
acreage in the Property].
IN WITNESS WHEREOF, the Grantor has executed this Deed this ____ day of
_____________, 20__.
_____________________________________
By: _________________________________
Title: ______________________________
[Add Appropriate Notary]
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SCHEDULE 13(a)(ii)
FORM OF XXXX OF SALE
XXXX OF SALE
This XXXX OF SALE is given this ___ day of ____, 2005 by
___________________, with an address c/o ______________________ ("Seller"), to
________________________, a __________________ ("Buyer").
Seller, for good and valuable consideration received from Buyer, the
receipt and sufficiency of which are hereby acknowledged, hereby bargains, sells
and conveys to Buyer all furnishings, furniture, equipment, supplies, and other
personal property (hereinafter collectively referred to as "Personal Property")
owned by any Seller which is located on, and used in connection with, the real
property more particularly described in the Agreement of Purchase and Sale dated
_______________ __, 2005 between Seller and Buyer, to have and to hold the
Personal Property unto Buyer, its successors and assigns, forever. Nothing
contained in this Xxxx of Sale shall be construed to include in the definition
of Personal Property any furniture, furnishings, trade fixtures, equipment or
other personal property of Sellers' management agent or of any tenant occupying
such real property.
The Personal Property is being transferred by Seller to Buyer in its "AS
IS" condition, without any representation or warranty of any kind or nature,
express, implied, statutory or otherwise, except that Seller warrants that the
Personal Property is free from any lien or encumbrance.
IN WITNESS WHEREOF, Seller has hereunto executed this Xxxx of Sale as of
the date first above written.
Witnesses: ____________________________
_________________________
_________________________ By: _______________________
Name:
Title:
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SCHEDULE 13(a)(iii)
FORM OF ASSIGNMENT AND ASSUMPTION OF LEASES
ASSIGNMENT AND ASSUMPTION OF LEASES
____________________________________, with an address c/o
__________________ ("Assignor"), for valuable consideration received, hereby
assigns to _____________________, a __________________ having an office at
___________________________________________ ("Assignee") all of Assignor's
right, title, interest and obligations as owner of certain real property more
fully described on Exhibit A, attached hereto and incorporated herein by this
reference and improvements thereon (the "Property"), under each lease and
tenancy affecting the Property (individually, a "Tenant Lease," and
collectively, the "Tenant Leases"), which Tenant Leases are identified and
described on Schedule I, attached to this Assignment and incorporated herein by
this reference, together with all right, power, and authority of Assignor to
alter, modify, or otherwise change the terms of the Tenant Leases and to
surrender, cancel, and terminate the Tenant Leases or any of them, and together
with all rents, income, and profits arising from the Tenant Lease from and after
the date of this Assignment, and from any renewals of the Tenant Leases,
including, without limitation, any security and damage deposits described
therein.
Assignee hereby accepts the foregoing assignment and assumes all of
Assignor's right, title, interest and obligations arising out of any of the
Tenant Leases from and after the date hereof.
This Assignment shall benefit and bind Assignor and Assignee and the
heirs, legal representatives, successors, and assigns of each of them.
S-87
IN WITNESS WHEREOF, Assignor, by its duly authorized representative,
executes this Assignment as of the _____ day of _______________, 2005.
WITNESSES: ASSIGNOR:
_____________________________ ___________________________________
By: _______________________________
Name:
Title:
ASSIGNEE
___________________________________
Name:
Title:
S-88
STATE OF ________________)
) SS:
COUNTY OF _______________)
On this ___ day of ________, 2005, before me, the undersigned notary
public, personally appeared ____________________, proved to me through
satisfactory evidence of identification to be the person whose name is signed on
the preceding document and acknowledged to me that ____ signed it voluntarily
for its stated purpose.
__________________________________
Notary Public
My Commission Expires: ___________
STATE OF ________________)
) SS:
COUNTY OF _______________)
On this ___ day of ________, 2005, before me, the undersigned notary
public, personally appeared ____________________, proved to me through
satisfactory evidence of identification to be the person whose name is signed on
the preceding document and acknowledged to me that ____ signed it voluntarily
for its stated purpose.
__________________________________
Notary Public
My Commission Expires: ___________
S-89
SCHEDULE 13(a)(iv)
FORM OF ASSIGNMENT AND ASSUMPTION OF SERVICE CONTRACTS AND INTANGIBLE PROPERTY
ASSIGNMENT AND ASSUMPTION OF SERVICE CONTRACTS
AND INTANGIBLE PROPERTY
___________________________________________, with an address c/o
___________________ ("Assignor"), for valuable consideration received, hereby
assigns to _______________________________________________, a
______________________ having an office at
______________________________________ ("Assignee") all of Assignor's right,
title, interest and obligations as owner of as owner of certain real property
more fully described on Exhibit A, attached hereto and incorporated herein by
this reference and improvements thereon (the "Property"), in (i) each contract
for operation or maintenance of the Property (individually, a "Service
Contract," and collectively, the "Service Contracts"), which Service Contracts
are identified and described on Schedule I attached to this Assignment and
incorporated herein by this reference and (ii) all intangible property owned by
Assignor and used in connection with the Property, including all trademarks and
trade names used in connection with the Property (including any interest Seller
may have in the name Riverview Tower and all logos and marks associated
therewith), all plans and specifications, if any, which were prepared in
connection with the construction of the improvements and all licenses, permits
and warranties now effect with respect to the Property to the extent assignable,
excluding any interest in Sellers' cash, securities, accounts (bank, deposit,
escrow, reserve or otherwise), etc. (collectively, the "Intangible Property").
Assignee hereby accepts the foregoing assignment and assumes all of
Assignor's right, title, interest and obligations under, or by reason of, the
Service Contracts and the Intangible Property from and after the date hereof.
This Assignment shall benefit and bind Assignor and Assignee and the
heirs, legal representatives, successors, and assigns of each of them.
S-90
IN WITNESS WHEREOF, Assignor, by its duly authorized representative,
executes this Assignment as of the _____ day of _______________, 2005.
WITNESSES: ASSIGNOR:
___________________________________
________________________________ By: _______________________________
Name:
Title:
WITNESS: ASSIGNEE
By: _______________________________
________________________________ Name:
Title:
S-91
STATE OF ________________)
) SS:
COUNTY OF _______________)
On this ___ day of ________, 2005, before me, the undersigned notary
public, personally appeared ____________________, proved to me through
satisfactory evidence of identification to be the person whose name is signed on
the preceding document and acknowledged to me that ____ signed it voluntarily
for its stated purpose.
__________________________________
Notary Public
My Commission Expires: ___________
STATE OF ________________)
) SS:
COUNTY OF _______________)
On this ___ day of ________, 2005, before me, the undersigned notary
public, personally appeared ____________________, proved to me through
satisfactory evidence of identification to be the person whose name is signed on
the preceding document and acknowledged to me that ____ signed it voluntarily
for its stated purpose.
__________________________________
Notary Public
My Commission Expires: ___________
S-92
SCHEDULE 13(a)(vi)
FORM OF AFFIDAVIT OF NON-FOREIGN STATUS
AFFIDAVIT OF NON-FOREIGN STATUS
(Corporation, Partnership, Trust, Transferor Estate)
Section 1445 of the Internal revenue Code of 1986, as amended, provides
that a transferee of a U.S. real property interest must withhold tax if the
transferor is a foreign person. For U.S. tax purposes (including section 1445),
the owner of a disregarded entity (which has legal title to a U.S. real property
interest under local law) will be the transferor of the property and not the
disregarded entity. To inform the transferee that withholding of tax is not
required upon disposition of a U.S. real property interest by
__________________________________ ("Seller"), the undersigned hereby affirms
the following on behalf of Seller:
1. Seller is not a foreign corporation, foreign partnership,
foreign trust, or foreign estate (as those terms are defined in the Internal
Revenue Code and income tax Regulations);
2. Seller is not a disregarded entity as defined in
ss.1.1445-2(b)(2)(iii);
3. Seller's U.S. employer identification number is _____________;
and
4. Seller's office address is: __________________________________.
The undersigned understands that this Affidavit may be disclosed to the
Internal Revenue Service by transferee and that any false statement contained
herein could be punished by fine, imprisonment, or both.
Under penalties of perjury, I declare that I have examined this
Affidavit and to the best of my knowledge and belief it is true, correct and
complete, and I further declare that I have authority to sign this Affidavit on
behalf of Seller.
__________________________________
By: _______________________________
Name:
Title:
Dated: ________________, 2005
S-93
SCHEDULE 13(a)(vii)
FORM OF SELLER'S CLOSING CERTIFICATE
SELLER'S CLOSING CERTIFICATE
______________________________, a ______________________________
("Seller"), hereby certifies to __________________ that there is no default
under the covenants, representations and warranties of Seller contained in that
certain Agreement of Purchase and Sale dated as of ______ __, 2005 (the
"Purchase Agreement") and, in addition, that all such representations and
warranties are true and correct in all material respects as of the date of this
Seller's Closing Certificate, subject to each of the limitations and conditions
in Section 8 of the Purchase Agreement and except as specified in reasonable
detail, on Exhibit 1 hereto, any defaults or exceptions that now exist; provided
that for purposes hereof, the lists of Tenant Leases and Service Contracts
attached to the Assignment of Leases and Assignment of Contracts executed
concurrently herewith shall be substituted for the list of Tenant Leases
described on Schedule 1(d) attached to the Purchase Agreement and the list of
Service Contracts described on Schedule 1(e) attached to the Purchase Agreement.
All capitalized terms used and not defined have the meanings given to them in
the Purchase Agreement.
This Seller's Closing Certificate is dated as of __________________ __,
2005.
__________________________________
By: _______________________________
Name:
Title:
S-94
EXHIBIT 1 TO SELLER'S CLOSING CERTIFICATE
LISTING OF DEFAULTS OR EXCEPTIONS
S-95
SCHEDULE 13(b)(v)
FORM OF BUYER'S CLOSING CERTIFICATE
BUYER'S CLOSING CERTIFICATE
________________________ ("Buyer"), certifies hereby certifies to
______________, a ___________________________________, that there is no default
under the covenants, representations and warranties of Buyer contained in that
certain Agreement of Purchase and Sale dated as of ______ __, 2005 and, in
addition, that all such representations and warranties are true and correct in
all material respects without exception as of the date of this Buyer's Closing
Certificate.
This Buyer's Closing Certificate is dated as of ___________________ __,
2005.
__________________________________
By: _______________________________
Name:
Title:
S-96
