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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) June 30, 1994
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IRT Property Company
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(Exact name of registrant as specified in its charter)
Georgia 1-7859 58-1366611
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
200 Galleria Parkway, Suite 1400, Atlanta, GA 30339
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (404) 955-4406
N/A
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(Former name or former address, if changed since last report)
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Item 2. Acquisition or Disposition of Assets.
On June 30, 1994, IRT Property Company (the "Company") acquired two
neighborhood and community shopping centers, Countryside Shops and Westgate
Square, in Broward County, Florida (the "Centers") totaling approximately
278,000 square feet of retail space. The acquisitions were from two Florida
general partnerships with common partners, and the Centers were managed by
Southeast Shopping Center Corporation, a related party. The total purchase
price paid by the Company for the Centers was $25,350,000 cash.
The acquisition was pursuant to an Agreement of Sale between the two
partnerships and the Company dated May 31, 1994 (the "Agreement"). The
Agreement was negotiated at arms' length between the Company and
representatives of the sellers. The factors considered by the Company in
determining the price to be paid for the properties included their historical
and expected cash flow, nature of the tenancies and terms of leases in place,
occupancy rates, opportunities for alternative and new tenancies, current
operating costs and taxes of the properties and anticipated changes therein
under Company ownership, prospects for financing the centers in certain cases,
the physical condition and locations of the properties, the anticipated effect
on the Company's financial results (including particularly funds from
operations) and the ability to sustain and potentially increase its
distributions to shareholders, and other factors. The Company took into
consideration capitalization rates that it believes other shopping centers may
recently have sold for, but determined the price it was willing to pay
primarily on the factors discussed above relating to the properties themselves
and their fit into the Company's post-acquisition operations. No separate
independent appraisals were obtained in connection with the acquisition.
Information regarding the Centers is as follows:
<TABLE>
<CAPTION>
Countryside Shops Westgate Square
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<S> <C> <C>
Area 173,161 sq. ft. 104,831 sq. ft.
Percent Leased 97% 98%
Year Completed 1986, 1988 & 1991 1984 & 1988
Cost to Company(1) $16,561,515 $9,037,391
Principal Tenants Publix, Eckerds, Winn-Dixie,
J. Byrons Walgreens
</TABLE>
(1) Initial purchase price of $16,400,000 and $8,950,000,
respectively, plus estimated costs of acquisition of $248,906.
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Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits
The following financial statements, pro forma financial information and
exhibits are a part of this report. The financial statements and pro forma
financial information are not yet complete and will be filed under cover of
Form 8-K/A as soon as practicable, and in any event not later than September 5,
1994.
(a) Financial Statements. Combined statement of revenues and
certain continuing expenses of the two shopping centers listed
below for the year ended December 31, 1993 (audited) and for
the three months ended March 31, 1994 (unaudited).
Countryside Shops, Cooper City, Florida
Westgate Square, Sunrise, Florida
After its investigation of the properties, the Company is not
aware of material factors that would cause the financial
information expected to be reported not to be necessarily
indicative of future operating results, other than occupancy
of the centers.
(b) Pro Forma Financial Information (unaudited).
(i) Pro forma combined balance sheet of the Registrant as
of March 31, 1994 and pro forma statements of
earnings (assuming acquisition of the aforesaid
Centers as of January 1, 1993) of the Registrant for
the year ended December 31, 1993 and the three months
ended March 31, 1994.
(ii) Estimated pro forma earnings from operations and
funds from operations of the Centers.
(c) Exhibits.
(i) Agreement of Sale dated May 31, 1994 between
Countryside Shops, Westgate Square and the Company
(exclusive of exhibits thereto).
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
IRT PROPERTY COMPANY
(Registrant)
July 14, 1994 BY: /s/ Mary M. Thomas
-------------------------------
Mary M. Thomas
Executive Vice President and
Chief Financial Officer
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AGREEMENT OF SALE
THIS AGREEMENT OF SALE is made and entered into as of the
31st day of May, 1994, by and among IRT PROPERTY COMPANY, a
Georgia corporation, as buyer ("Buyer"), and COUNTRYSIDE SHOPS, a
Florida general partnership ("Countryside") and WESTGATE SQUARE,
a Florida general partnership ("Westgate"), as sellers
(Countryside and Westgate being sometimes hereinafter referred to
collectively as "Sellers").
RECITALS
WHEREAS, Countryside is the owner of the Countryside
Property (as hereinafter defined); and
WHEREAS, Westgate is the owner of the Westgate Property (as
hereinafter defined); and
WHEREAS, Sellers desire and hereby agree to sell, and Buyer
desires and hereby agrees to acquire, all of Sellers' right,
title and interest in the Property (as hereinafter defined) and
related assets, subject to and upon the terms and conditions as
hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual promises and
agreements hereinafter set forth and for other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties agree as follows:
1. Definitions of Certain Terms. For all purposes of this
Agreement, the following terms shall have the respective meanings
set forth below:
"Agreement" shall mean this document entitled
"Agreement of Sale", all exhibits and schedules attached hereto
or made a part hereof and all amendments to this Agreement which
are agreed to in writing and signed by the parties hereto.
"Anchor Tenants" shall mean the Countryside Anchor
Tenants and Westgate Anchor Tenants.
"Assignments" shall have the meaning set forth in
Paragraph 4(e) hereof.
"Bills of Sale" shall have the meaning set forth in
Paragraph 4(d) hereof.
"Broker" shall have the meaning set forth in
Paragraph 16 hereof.
"Business Day" shall mean any day that banks in Broward
County, Florida are open for business, excluding Saturdays and
Sundays.
"CAM Charges" shall have the meaning set forth in
Paragraph 6(a)(5) hereof.
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"Closing" shall have the meaning set forth in
Paragraph 10 hereof.
"Closing Date" shall mean June 30, 1994, or such
earlier date as requested by Buyer and approved by Seller.
"Commitments" shall have the meaning set forth in
Paragraph 4(b) hereof.
"Contracts" shall mean the Countryside Contracts and
the Westgate Contracts.
"Countryside Anchor Tenants" shall mean those
businesses leasing space in the Countryside Property and
operating under the tradenames Publix Supermarket, Eckerd's
Drugs, J. Byrons Department Store, McDonald's and Barnett Bank.
"Countryside Contracts" shall mean all contracts and
agreements entered into by Countryside with respect to the
management, operation, supply, maintenance, repair or
construction affecting the Countryside Property, including the
warranties or causes of action relating to such warranties which
inure to the benefit of Countryside, to the extent assignable by
Countryside, which are described on Exhibit "B-1", attached
hereto and made a part hereof.
"Countryside Estoppel" shall have the meaning set forth
in Paragraph 28(a) hereof.
"Countryside Leases" shall mean those certain leases
executed by Countryside, as landlord, covering certain rentable
space within the Countryside Property, which leases are more
fully described on the rent roll attached hereto and made a part
hereof as Exhibit "C-1".
"Countryside Licenses" shall mean the licenses,
permits, approvals and agreements affecting the Countryside
Property including, without limitation, those which are set forth
on Exhibit "D-1" to this Agreement which is attached hereto and
made a part hereof.
"Countryside Permitted Exceptions" shall mean the
exceptions to title set forth on Exhibits "E-1" to this
Agreement.
"Countryside Personal Property" shall mean the tangible
personal property, including without limitation, fixed and
movable fixtures, together with all component and replacement
parts, owned by Countryside and situated on the Countryside
Property and used by Countryside in connection with the
management, operation, maintenance and repair of the Countryside
Property.
"Countryside Property" shall mean that certain 25 plus
or minus acre parcel of real property known as Countryside Shops,
located at the northeast corner of Stirling Road and Flamingo, in
Cooper City, Broward County, Florida, which is more fully described
on Exhibit "A-1" attached hereto and made a part hereof, upon which
is constructed a retail shopping center and other related improvements,
and which contains such
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other rights as are described in Paragraph 2(a) hereof.
"Deeds" shall have the meaning set forth in
Paragraph 4(c) hereof.
"Deposit" shall mean the cash deposit delivered by
Buyer to Escrow Agent pursuant to Paragraph 3(a) hereof.
"Escrow Agent" shall mean Chicago Title Insurance
Company, having an address at 5775-C Peachtree-Dunwoody Road,
Suite 200, Atlanta, Georgia 30342.
"Estoppel Standard" shall have the meaning set forth in
Paragraph 28(a) hereof.
"Execution Date" shall mean the date on which this
Agreement has been fully executed by both parties hereto.
"Free Rent" shall mean the discount against the payment
of minimum rent and CAM Charges granted by Sellers in the Leases.
"Leases" shall mean the Countryside Leases and the
Westgate Leases.
"Licenses" shall mean the Countryside Licenses and the
Westgate Licenses.
"Permitted Exceptions" shall mean the Countryside
Permitted Exceptions, Westgate Permitted Exceptions, and such
other title matters existing on the Closing Date which are
accepted or deemed accepted by Buyer pursuant to Paragraph 4
hereof.
"Personal Property" shall mean the Countryside Personal
Property and the Westgate Personal Property.
"Property" shall mean the Countryside Property,
Westgate Property, the Personal Property, Contracts, Licenses and
all other rights, titles, interests and obligations to be
conveyed, sold or otherwise transferred to Buyer by Sellers
pursuant to this Agreement.
"Purchase Price" shall have the meaning set forth in
Paragraph 3 hereof.
"Tax Schedules" shall mean the information concerning
real estate taxes (identifying the assessed valuation of the
Countryside Property and the Westgate Property), and personal
property taxes (identifying the assessed valuation of the
Countryside Personal Property and the Westgate Personal
Property), all as set forth on Exhibits "G-1" and "G-2" attached
hereto and made a part hereof.
"Tenant Estoppel" shall have the meaning set forth in
Paragraph 28(a) hereof.
"Tenants" shall mean the tenants under the Countryside
Leases
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and the Westgate Leases, as identified in Exhibits "C-1" and "C-
2".
"Title Defect" shall have the meaning set forth in
Paragraph 4(b) hereof.
"Title Insurer" shall have the meaning set forth in
Paragraph 4(a) hereof.
"Title Policies" shall have the meaning set forth in
Paragraph 4(b) hereof.
"Warranty Escrow Holdback" shall have the meaning set
forth in Paragraph 8(f) hereof.
"Westgate Anchor Tenants" shall mean those businesses
leasing space in the Westgate Property and operating under the
tradenames Winn Dixie Supermarket and Walgreens Drug Store.
"Westgate Contracts" shall mean all contracts and
agreements entered into by Westgate with respect to the
management, operation, supply, maintenance, repair or
construction affecting the Westgate Property, including the
warranties or causes of action relating to such warranties which
inure to the benefit of Westgate, to the extent assignable by
Westgate, which are described on Exhibit "B-2", attached hereto
and made a part hereof.
"Westgate Estoppel" shall have the meaning set forth in
Paragraph 28(a) hereof.
"Westgate Leases" shall mean those certain leases
executed by Westgate, as landlord, covering certain rentable
space within the Westgate Property, which leases are more fully
described on the rent roll attached hereto and made a part hereof
as Exhibit "C-2".
"Westgate Licenses" shall mean the licenses, permits,
approvals and agreements affecting the Westgate Property
including, without limitation, those which are set forth on
Exhibit "D-2" to this Agreement which is attached hereto and made
a part hereof.
"Westgate Permitted Exceptions" shall mean the
exceptions to title set forth on Exhibits "E-2" to this
Agreement.
"Westgate Personal Property" shall mean the tangible
personal property, including without limitation, fixed and
movable fixtures, together with all component and replacement
parts, owned by Westgate and situated on the Westgate Property
and used by Westgate in connection with the management,
operation, maintenance and repair of the Westgate Property.
"Westgate Property" shall mean that certain 16 plus or
minus acre parcel of real property known as Westgate Square,
located at the southeast corner of Weston Road and I-75/State Road
84, in the City of Sunrise, Broward County, Florida, which is more
fully described on Exhibit "A-2" attached hereto and made a part
hereof, upon which is constructed a
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retail shopping center and other related improvements, and which
contains such other rights as are described in Paragraph 2(b)
hereof.
2. Acquisition of the Property. On the Closing Date, and
subject to the terms and conditions set forth in this Agreement:
(a) Countryside shall sell, assign, transfer and
convey to Buyer and Buyer shall purchase from Countryside the
following:
(1) all right, title and interest of Countryside
in and to the Countryside Property, and all other improvements
located thereon and associated therewith which are owned by
Countryside (under and subject to the Countryside Permitted
Exceptions);
(2) all easements, covenants and other rights
appurtenant to, and all the estate and rights of Countryside in
and to, the Countryside Property and the improvements thereon;
(3) all right, title and interest of Countryside
in and to the Countryside Personal Property;
(4) all right, title and interest of Countryside
in and to the Countryside Leases, and any other leases executed
by Countryside between May 12, 1994, and the Closing Date;
(5) all impact fees credits and/or water and
water connection fee credits, if any, relating to the Countryside
Property;
(6) to the extent assignable to Buyer and/or not
canceled by Countryside, all right, title and interest of
Countryside in and to the Contracts, and, to the extent
assignable to Buyer, all right, title and interest of Countryside
in and to the Licenses relating to the Countryside Property; and
(7) all rights of Seller in and to escrowed funds
and deposits under the Countryside Leases, except for
Countryside's rights under the Lady of America lease improvement
escrow.
(b) Westgate shall sell, assign, transfer and convey
to Buyer and Buyer shall purchase from Westgate the following:
(1) all right, title and interest of Westgate in
and to the Westgate Property, and all other improvements located
thereon and associated therewith which are owned by Westgate
(under and subject to the Westgate Permitted Exceptions);
(2) all easements, covenants and other rights
appurtenant to, and all the estate and rights of Westgate in and
to, the Westgate Property and the improvements thereon;
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(3) all right, title and interest of Westgate in
and to the Westgate Personal Property;
(4) all right, title and interest of Westgate in
and to the Westgate Leases, and any other leases executed by
Westgate between May 12, 1994, and the Closing Date; and
(5) all impact fees credits and/or water and
water connection fee credits, if any, relating to the Westgate
Property;
(6) to the extent assignable to Buyer and/or not
canceled by Westgate, all right, title and interest of Westgate
in and to the Contracts, and, to the extent assignable to Buyer,
all right, title and interest of Westgate in and to the Licenses
relating to the Westgate Property; and
(7) all rights of Seller in and to escrowed funds
and deposits under the Westgate Leases.
3. Purchase Price and Time of Payment.
(a) The purchase price (the "Purchase Price") to be
paid by Buyer to Sellers for the Property shall be Twenty-Five
Million Three Hundred Fifty Thousand Dollars ($25,350,000.00), as
adjusted pursuant to Paragraph 6 of this Agreement, which shall
be paid to Sellers in the following manner:
(1) Not later than 5 P.M. on such date which is
two (2) Business Days after the Execution Date, Buyer shall
deposit with Escrow Agent the sum of Two Hundred Fifty Thousand
Dollars ($250,000) U.S., in cash, by U.S. bank treasurer's or
cashier's check, or by federal wire transfer of funds (the
"Deposit"). Promptly after the Execution Date, Buyer and Sellers
shall execute an escrow agreement with Escrow Agent in the form
attached hereto as Exhibit "N-1".
(2) Escrow Agent shall be authorized to deposit
the Deposit in an interest-bearing escrow account in a bank or
other financial institution. For purposes thereof, Buyer's
federal employer identification number is 58-1366611. All or any
interest earned on the Deposit shall accrue to the benefit of and
be payable to Buyer unless Closing does not occur hereunder, in
which event interest earned on the Deposit shall accrue to the
benefit of and be payable to the party entitled to receive the
Deposit pursuant to the terms and conditions of this Agreement.
(3) The balance of the Purchase Price, as
adjusted pursuant to Paragraph 6 of this Agreement, shall be paid
to Sellers at Closing by immediately available federal U.S.
funds, wire transferred to an account designated by Sellers.
(b) The parties acknowledge and agree that:
(1) Sixteen Million Four Hundred Thousand Dollars ($16,400,000)
of Purchase Price is allocated to the Countryside Property, and
(2) Eight Million Nine Hundred Fifty Thousand Dollars
($8,950,000) of the Purchase Price is
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allocated to the Westgate Property.
4. Title and Conveyance of the Property.
(a) Buyer's obligation to close this transaction shall
be conditioned upon, at Closing, title to the Countryside
Property and the Westgate Property being good and marketable and
insurable at regular rates by Chicago Title Insurance Company, or
such other title insurance company selected by Buyer (and
approved by Sellers) which is licensed to do business in the
State of Florida (the "Title Insurer"), free and clear of all
liens, encumbrances, and restrictions other than the Permitted
Exceptions.
(b) (1) Buyer currently has in its possession title
insurance commitments issued by Title Insurer ("Commitments")
agreeing to issue to Buyer, upon recording of the Deeds, owner's
policies of title insurance ("Title Policies") in the prorated
amounts of the Purchase Price (as described in Paragraph 3(b)
above), subject only to the Permitted Exceptions, such other
title exceptions as Buyer has agreed to accept, or is deemed to
have accepted pursuant to this Paragraph, and any other
exceptions which shall be discharged by Sellers at or before
Closing. If title to the Countryside Property and the Westgate
Property contains title exceptions other than the Permitted
Exceptions to which Buyer objects (a "Title Defect"), Buyer shall
notify Sellers of such fact contemporaneously with the execution
of this Agreement, which notice shall specify the Title Defect
and shall be accompanied with sufficient information to enable
Sellers to respond. Upon Sellers' receipt of such notice,
Sellers shall have the right, but not the obligation, to cure
such Title Defect not later than the Closing Date, and Sellers
shall notify Buyer within three (3) Business Days after receipt
of such notice whether Sellers intend to cure such Title Defect.
If Sellers notify Buyer that Sellers do not intend to cure the
Title Defect or if the Title Defect is not cured, Buyer shall
have the option, as its sole and exclusive remedy, of either
accepting title to the Property without abatement of the Purchase
Price or of terminating this Agreement by giving notice to
Sellers of such election as of the Closing Date, and in the
latter event, Buyer shall receive a refund of the Deposit and the
rights and liabilities of the parties hereto shall cease and
terminate.
(2) Notwithstanding the foregoing, Sellers agree
that they shall: (A) cure any monetary encumbrance (i.e.,
mortgage, judgment and taxes) which encumbers the Property as of
the Execution Date which can be cured by the payment of money,
(B) cure any Title Defect arising after the Execution Date which
has been placed as an encumbrance on the Property with Sellers'
consent, and (C) cure any Title Defect arising after the
Execution Date which has been placed as an encumbrance on the
Property without Sellers' consent or which has otherwise
involuntarily become an encumbrance on the Property, which can be
cured by the payment of money up to an aggregate sum not to
exceed Two Hundred Fifty Thousand Dollars ($250,000). To the
extent that Sellers need to cure such a Title Defect, such sums
expended are to be set off against the Warranty Escrow Holdback.
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(3) Notwithstanding the existence of any Title
Defect, Buyer shall be deemed to have accepted the condition of
title and any such Title Defect unless it has given Sellers
timely notice as herein provided, after which time any such Title
Defect shall be a Permitted Exception. In any event, the
condition of title to the Property, including without limitation
any title exception which would otherwise be a Title Defect shall
be a Permitted Exception if Closing occurs. Buyer understands
and agrees that the termination of this Agreement and the return
of the Deposit to Buyer shall be Buyer's sole and exclusive
remedy hereunder with respect to the title to the Countryside
Property and the Westgate Property.
(c) At Closing, Sellers will convey fee simple title
to the Countryside Property and the Westgate Property,
respectively, by special warranty deeds ("Deeds"), subject to the
Permitted Exceptions, in the forms attached hereto and made a
part hereof as Exhibits "H-1" and "H-2".
(d) At Closing, Sellers will transfer title to the
Personal Property to Buyer by executing bills of sale ("Bills of
Sale") in the forms attached hereto and made a part hereof as
Exhibits "F-1" and "F-2".
(e) At Closing, Sellers will also assign and Buyer
shall assume all of Sellers' right, title, and interest, if any,
including all the obligations of Sellers, in, to and under:
(1) the Leases and any security deposits, (2) the Licenses and
the Contracts, (3) the trade name for the shopping centers, and
(4) any warranties and guaranties affecting the Property, to the
extent desired by Buyer and at no expense to Sellers, by
execution of and delivery of the assignments by Buyer and Sellers
in the forms attached hereto as Exhibits "I-1" and "I-2" (the
"Assignments").
(f) At Closing, Sellers will deliver to Buyer an
updated schedule of Leases and rent roll which are in existence
as of the Closing Date, which schedule and rent roll will be
certified on behalf of Sellers as being true and correct as of
the Closing Date.
(g) Buyer and Sellers acknowledge and agree that the
Countryside Property and the Westgate Property are being sold
together, that there is no intention for Buyer to be permitted to
purchase one but not both properties, and that Sellers' only
obligation hereunder is to sell both properties to Buyer.
5. Closing Documents.
(a) At the time and place of Closing, Sellers shall
deliver to Buyer the following:
(1) the Deeds executed by Sellers covering the
Countryside Property and the Westgate Property, respectively;
(2) the Assignments executed by Sellers;
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(3) as many signed originals (or true and correct
copies of same) of the Leases, Contracts, Licenses, and other
items covered by the Assignments, as are in Sellers' possession,
unless previously delivered by Sellers to Buyer. (In connection
with the foregoing, Buyer's representatives shall meet with
Sellers' representatives in Miami, Florida at least three (3)
days prior to Closing to review, confirm and accept the Leases,
Contracts, Licenses, and other items covered by the Assignments
to be delivered to Buyers at Closing);
(4) all equipment operating manuals and all
equipment warranties and equipment guarantees, if any, in
Sellers' possession;
(5) all master and duplicate keys to all locks
for the Building which are in Sellers' possession;
(6) as many originals (or true and correct copies
of same) of all rental records, permits and approvals relating to
the Property, which are in Sellers' possession;
(7) partnership resolutions of Sellers
authorizing and consenting to this transaction, and such other
necessary partnership/corporate documentation as Buyer and/or
Title Insurer may reasonably require;
(8) estoppel certificates as described in
Paragraph 28 below;
(9) affidavits of no liens executed by Sellers in
the forms attached hereto and made a part hereof as
Exhibits "J-1" and "J-2";
(10) the Bills of Sale executed by Sellers
covering the Personal Property;
(11) evidence of the termination of the management
agreements for the Property;
(12) executed notices to Tenants disclosing the
sale of the Countryside Property and Westgate Property,
respectively, to Buyer and directing that rent be paid to Buyer
from and after the Closing Date;
(13) a renewal of the representations and
warranties of Seller to the extent required under Paragraph 8(c)
hereof;
(14) construction plans and drawings for the
Countryside Property and the Westgate Property, and the
undeveloped portions of the Westgate Property, to the extent
available and transferrable to Buyer; and
(15) Florida Form DR-219 documentary transfer
affidavit.
(16) originals of all available certificates of
occupancy which are in Sellers' possession.
<PAGE> 13
(b) At the time and place of Closing, Buyer shall
deliver to Sellers the following:
(1) the Assignments executed by Buyer; and
(2) a corporate resolution of Buyer authorizing
and consenting to the transactions described herein, and a
certificate of good standing, or the equivalent thereof, from the
States of Georgia and Florida, and such other necessary corporate
documentation as Sellers and/or Title Insurer may reasonably
require.
6. Prorations and Closing Costs. All matters involving
prorations or adjustments to be made in connection with Closing
and not specifically provided for in some other provision of this
Agreement shall be adjusted as follows:
(a) All items to be prorated pursuant to this
Paragraph shall be prorated as of the Closing Date, with Buyer to
be treated as the owner of the Property, for purposes of
prorations of income and expenses, on and after the Closing Date.
(1) (A) Real estate tax and all other ad valorem
tax expenses, if any, with respect to the Countryside Property
and Westgate Property for the applicable fiscal or calendar year
in which the Closing occurs shall be prorated on a per diem basis
using the actual number of days in such year as a basis. If the
amount of such taxes is not known on the Closing Date, proration
of such taxes will be made based upon the greater of: (i) the
most recent estimates of taxes (which are being charged to
Tenants of the Property as part of CAM Charges), or (ii) the
taxes assessed for the year 1993 at the maximum discount rate.
(B) The parties acknowledge and agree that
if the estimated taxes differ from the taxes as finally
determined for the period of time in which Closing occurred,
then, for up to one (1) year from the Closing Date, the parties
will adjust the Closing prorations at the time of final
determination of the actual taxes to reflect the actual charges.
If Sellers are required to reimburse Buyer for any excess tax
expense proration allocated to Sellers at Closing (collectively,
"Sellers' Tax Reimbursement"), then Sellers agree to do so within
ten (10) Business Days after Buyer and Sellers have agreed upon
the appropriate amount of Sellers' Tax Reimbursement; in
connection with the foregoing, promptly after Buyer receives
Sellers' Tax Reimbursement Buyer agrees to bill Tenants (for a
six (6) consecutive month period) for their proportionate share
of Sellers' Tax Reimbursement, and all sums collected by Buyer
relating to Sellers' Tax Reimbursement (subject to the provisions
of Paragraph 6(e)(2)(A)) will be paid to Seller within ten (10)
Business Days after the end of such six (6) month period,
together with an accounting of such collections.
(C) Notwithstanding the foregoing, Sellers'
proportionate share of such taxes shall be reduced by the pro
rata portion of such taxes due from any of the Anchor Tenants
which pay annually in arrears under their respective leases;
provided, however, that if Buyer does not receive the taxes owed
by any of the Anchor Tenants for the year of Closing within the
later of (i) ninety (90) days
<PAGE> 14
following the end of calendar year 1994, or (ii) thirty (30) days
after request by Buyer, Sellers shall, upon written notice from
Buyer, refund to Buyer the portion of such prorated taxes
attributable to such Anchor Tenant(s). If Buyer receives such a
refund from Sellers and subsequently receives payment for the
same taxes from any of the applicable Anchor Tenants, then Buyer
shall return to Sellers the refund that Sellers previously made
to Buyer.
(D) The provisions of this Paragraph 6(a)(1)
shall survive Closing hereunder for a period of one (1) year from
the Closing Date.
(2) There shall be no proration of Sellers'
insurance premiums or assignment of Sellers' insurance policies
and Sellers shall be entitled to cancel all of its existing
policies as of the Closing Date. Buyer shall be obligated (at
its own election) to obtain any replacement policies.
(3) The amounts of all electric, sewer, water and
other utility bills, trash removal bills, janitorial and
maintenance service bills relating to the Property and allocable
to the period prior to the Closing Date shall be determined and
paid by Sellers before Closing, if possible, or shall be paid
thereafter by Sellers or adjusted between Buyer and Sellers
immediately after the same have been determined. Buyer and
Sellers shall enter into an agreement to such effect at Closing.
Sellers shall attempt to have all utility meters read as of the
Closing Date. Sellers shall further attempt to obtain from the
provider of same, all other service statements and bills of
account adjusted as of the Closing Date. Sellers shall be
entitled to refunds of all deposits, if any, paid by Sellers
prior to Closing and held by entities providing such service.
(4) All Contracts and other obligations in
connection with the Property shall be prorated as of the Closing
Date.
(5) All common area maintenance expenses and
costs, taxes and insurance, shall be prorated as of the Closing
Date ("CAM Charges").
(b) Special assessments which are due and payable
and/or have been filed as a lien against the Property, on or
before the Closing Date shall be paid by Sellers. Special
assessments which are not due and payable, and/or are or may be
pending but which have not become a lien on the Property, as of
the Closing Date shall be assumed by Buyer.
(c) Buyer agrees to pay the expense of the title
search and premium for any title insurance costs on the owner's
title insurance policy (including special endorsements), the cost
of recording fees for the Deeds, the cost of any environmental
studies conducted on the Countryside Property and/or Westgate
Property beyond a so-called Phase I environmental study, the
expense of recording all mortgage related documents for any
purchase money or other financing, if any, the expense of the
title search and premium for any title insurance costs on any
lender's title policy (including special endorsements required by
Buyer
<PAGE> 15
or lender's counsel), if any, all other mortgage related costs
(including without limitation State documentary stamps or other
charges on any mortgages and intangible tax on any notes), if
any, the legal fees of its own counsel.
(d) Sellers agree to pay the cost of documentary
stamps on the Deeds, the cost of the survey for the Countryside
Property and Westgate Property, the cost of a so-called Phase I
environmental study conducted on the Countryside Property and the
Westgate Property not to exceed the sum of One Thousand Seven
Hundred Dollars ($1,700) for each of the Countryside Property and
the Westgate Property, the cost of engineering reports prepared
by Law Engineering, Inc. (Atlanta, Georgia) not to exceed the sum
of Two Thousand Six Hundred Sixty-Seven Dollars ($2,667) for each
of the Countryside Property and the Westgate Property, recording
fees for the satisfaction of the mortgages and all corrective
instruments which Sellers have agreed to provide pursuant to this
Agreement and to pay the expense of its counsel including the
cost associated with preparing the Deeds, Bills of Sale,
Assignments, the satisfaction of the mortgages and all corrective
instruments which Sellers have agreed to provide pursuant to this
Agreement.
(e) (1) (A) Any rentals and CAM Charges collected in
advance by Sellers for a rental period or portion thereof from or
after the Closing Date shall be credited to Buyer at Closing on a
per diem basis. In addition, any security deposits held by
Sellers for any Lease shall either be credited to or transferred
to Buyer at Closing.
(B) To the extent any of the Leases contain
periods of Free Rent in the current term which continue beyond
the Closing Date, then Buyer shall receive as a credit against
the Purchase Price an amount equal to the amount of Free Rent
given to any Tenant which continues beyond the Closing Date.
(C) To the extent any of the Leases provide
for initial tenant construction/fit-out allowances (as opposed to
extension/renewal refurbishment allowances) which have not been
funded by Sellers on or before the Closing Date, then Buyer shall
receive as a credit against the Purchase Price an amount equal to
the amount of any currently outstanding and unfunded tenant
construction/fit-out allowances.
(2) (A) Any rentals and CAM Charges collected by
Buyer within six (6) months after Closing (or in the case of 1994
CAM Charges within six (6) months after billing), for a period or
portion thereof prior to the Closing Date, shall first be set off
against rentals and CAM Charges accruing after the Closing Date
and any excess shall then be paid by Buyer to Sellers, to the
extent owed to Sellers, within ten (10) Business Days after the
end of such six (6) month period, together with an accounting of
such collections.
(B) In addition to Buyer's obligations under
Paragraph 6(e)(2)(A) above, Buyer shall also collect on behalf of
Westgate and pay to Westgate promptly after receipt the following
amounts from the following tenants:
<PAGE> 16
(i) all amounts due from Great Western
Bank (the tenant in Space 27-28 of the Westgate Property) in
excess of the amounts payable by State Farm, as subtenant ($14
per square foot plus the proportionate share of any increase in
taxes and operating costs), through the existing term of the
Great Western lease (which expires on November 30, 1994); and
(ii) all amounts due from Animal Care
(the tenant in Space 36 of the Westgate Property), through the
existing term of the Animal Care lease (which expires on
January 31, 1995).
(C) All amounts paid to Sellers under this
Paragraph 6(e)(2) shall be net of any sales tax which Buyer shall
pay, on behalf of Sellers, directly to the State of Florida.
Upon request, Buyer shall forward evidence of the payment of such
sales taxes to Sellers.
(3) (A) Sellers will bill all 1993 common area
maintenance and real estate tax adjustments prior to Closing
hereunder, shall respond to inquiries from Tenants regarding such
adjustments prior to and after Closing, and shall be entitled to
retain all monies due and owing in connection therewith to the
extent (any and/or all) such sums are collected by Sellers prior
to Closing. Buyer hereby waives any rights to such sums
collected by or on behalf of Sellers pursuant to the terms of
this Paragraph.
(B) Sellers shall have the right to pursue
the 1993 common area maintenance and real estate tax adjustments
from Anchor Tenants which remain outstanding for a period of
ninety (90) days after the Closing Date. If any of such 1993
common area maintenance and real estate tax adjustments remain
outstanding after such ninety (90) day period, then Buyer, for a
period of three (3) months thereafter, shall bill such
outstanding amounts to the applicable Anchor Tenants. Any such
1993 common area maintenance and real estate tax adjustments
collected by Buyer within such three (3) month period shall then
be paid by Buyer to Sellers within ten (10) Business Days after
the end of such three (3) month period, together with an
accounting of such collections.
(C) With regard to all other Tenants (other
than the Anchor Tenants), for a period of six (6) months after
the Closing Date, Buyer shall bill such outstanding amounts to
the applicable Tenants. Subject to the provisions of
Paragraph 6(e)(2)(A), any such 1993 common area maintenance and
real estate tax adjustments collected by Buyer within such
six (6) month period shall then be paid by Buyer to Sellers
within ten (10) Business Days after the end of such six (6) month
period, together with an accounting of such collections.
(4) (A) Buyer will bill on behalf of Sellers,
for a period of six (6) months after a determination of the
amount thereof is made, any additional 1994 common area
maintenance and real estate tax charges to the extent it is
determined that Sellers have underestimated the tenants'
proportionate share of CAM Charges for the Countryside Property
and/or Westgate Property, respectively for the period of
<PAGE> 17
January 1, 1994, through the Closing Date. Subject to the
provisions of Paragraph 6(e)(2)(A), any such 1994 common area
maintenance and real estate tax adjustments collected by Buyer
within such six (6) month period shall then be paid by Buyer to
Sellers within ten (10) Business Days after the end of such
six (6) month period, together with an accounting of such
collections.
(B) If Sellers have overestimated (and
collected) the tenants' proportionate share of CAM Charges for
the Countryside Property and/or Westgate Property, respectively
for the period of January 1, 1994, through the Closing Date, then
Sellers shall, within ten (10) Business Days after Buyer and
Sellers have agreed upon the appropriate amount of Sellers' CAM
reimbursement, reimburse such sums to Buyer provided that Buyer
delivers to Sellers contemporaneously therewith an agreement to
indemnify, defend, and hold Buyer harmless from and against any
loss, damage, or claim made by any of such tenants as to any
overpayment of such 1994 CAM Charges paid to Buyer by Sellers.
(5) (A) Except as provided in
Paragraph 6(e)(5)(B) below, Sellers shall pay the cost of any
leasing commissions due and payable in connection with any of the
Leases so that neither the Property nor any Lease shall be
subject to any leasing commissions as of the Closing Date.
(B) Buyer shall pay the cost of any leasing
commissions due and payable in connection with (i) any renewal,
option, extension or expansion under any Lease which a Tenant
exercises after May 12, 1994, and (ii) any leases other than the
Leases.
(6) Except with regard to the collection of such
sums described in Paragraph 6(e)(3) above, Sellers hereby waive
the right to pursue their respective remedies against Tenants
after Closing for delinquencies in making payments.
(7) Buyer shall, on behalf of Sellers, bill to
Tenants, and any other applicable party, the sums described in
Paragraphs 6(a)(1)(C), 6(e)(2), 6(e)(3) and 6(e)(4), which
billings shall evidence Buyer's attempt to collect the same.
(8) The provisions of this Paragraph 6(e) shall
survive Closing hereunder.
7. Possession of Property.
(a) Sellers shall deliver possession of the Property
to Buyer on the Closing Date subject to the Permitted Exceptions.
(b) Buyer shall assume, by execution of the
Assignments, all of Sellers' right, title, interest and
obligations in, to and under the Leases, Licenses and Contracts,
then in effect which are assignable (and to the extent the same
are assignable by Sellers). Except as otherwise provided herein,
the parties hereto acknowledge that Sellers shall be responsible
for all obligations payable under the Leases, Licenses and
<PAGE> 18
Contracts prior to the Closing Date, and Buyer shall be
responsible for all obligations thereunder from and after the
Closing Date.
8. Representations.
(a) Countryside hereby represents and warrants to
Buyer as follows, all of which shall be true and correct at and
as of May 12, 1994:
(1) Countryside is a general partnership duly
formed and validly existing under the laws of the State of
Florida, and is in good standing in the State of Florida, with
full and complete authority to enter into this Agreement and to
consummate the transactions contemplated herein. Countryside has
obtained all consents with respect to the execution by
Countryside of this Agreement and the performance by Countryside
of its obligations under this Agreement.
(2) Countryside has not received written notice
from any governmental authority of proceedings relating to the
use, occupancy, maintenance or operation of the Countryside
Property.
(3) Countryside has not notified any Tenant under
the Countryside Leases that such Tenant is in default thereunder
for failure to pay monetary obligations; Countryside has not
received written notice that Countryside is in material default
under any of the Countryside Leases; Countryside has no actual
knowledge that Countryside is in material default under any of
the Countryside Leases; and Countryside has no actual knowledge
that any Countryside Anchor Tenant is in default under the terms
of its applicable lease or that there exists any event which
except for the passage of time or otherwise would constitute a
default under any Countryside Anchor Tenant lease.
(4) Countryside has not notified any contractor
under the Countryside Contracts that it is in default thereunder,
and Countryside has not received written notice that Countryside
is in default under any of the Countryside Contracts.
(5) Countryside has not received written notice
of the existence of any charges, assessments or liens for public
improvements concerning the Countryside Property which remain
unpaid.
(6) To the extent any improvements which might
form the basis of mechanics' or materialmen's liens have been
made or will be made to the Countryside Property prior to
Closing, Countryside agrees to keep the Countryside Property free
from liens which might result from such improvements.
(7) Other than as set forth in the Litigation
Schedule attached hereto as Exhibit "K-1", Countryside has not
received written notice of any pending adverse claim, or
judicial, municipal or administrative proceedings affecting the
Countryside Property or any portion thereof, including without
limitation, proceedings for or involving collections,
condemnations, eminent domain, alleged building code or zoning
violations, or personal injuries or property damage alleged to
<PAGE> 19
have occurred on the Countryside Property or by reason of the
condition or use of the Countryside Property.
(8) Countryside has received no written notice
from any insurance carrier of the existence of defects or
inadequacies in the Countryside Property.
(9) Countryside is not a "foreign person" and
will deliver to Buyer at Closing, an affidavit certifying that it
is not a "foreign person" within the meaning of the Internal
Revenue Code of 1986, as amended, in the form attached hereto as
Exhibit "L-1".
(10) There are no leases or any other tenancies
for any space in the Countryside Property other than those set
forth on Exhibit "C-1" attached hereto, and the rent roll
attached hereto as part of Exhibit "C-1" is true and correct in
all material respects.
(11) There are no contracts relating to the
Countryside Property other than those set forth on Exhibit "B-1"
attached hereto.
(12) Countryside has received no notice in writing
of violation of any zoning, building, environmental or any other
land use ordinances and regulations affecting the Countryside
Property or the business being conducted thereon.
(13) Countryside does not employ workers in
connection with the operation of the Countryside Property.
(14) Countryside shall be solely responsible for
any leasing commissions payable under the Countryside Leases.
(15) Countryside shall be responsible for the
payment of all sales tax due for rental received by Countryside
for the Countryside Property through the Closing Date, and will
file all appropriate forms in connection therewith, in accordance
with Section 12A-1.055, Florida Administrative Code, and
Section 212, Florida Statutes.
(16) Countryside will maintain its current levels
of insurance coverages for hazard insurance and general liability
insurance through the Closing Date.
(17) Countryside has not used the Countryside
Property to generate, manufacture, refine, transport, treat,
store, handle or dispose of Hazardous Material, and to its actual
knowledge has not received a summons, citation, directive, letter
or other communication, written or oral, from any agency or
Department of the State of Florida or the U.S. Government
concerning any intentional or unintentional action or omission on
Countryside's part which resulted in the releasing, spilling,
leaking, pumping, pouring, emitting, emptying or dumping of
Hazardous Material on the Countryside Property. "Hazardous
Material" shall mean any flammable or explosive materials,
petroleum or petroleum products, natural gas or synthetic gas
usable for fuel, radioactive materials, hazardous wastes or
substances or toxic wastes or substances, including without
limitation, any substances now or
<PAGE> 20
hereafter defined as or included in the definition of "hazardous
substances", hazardous wastes", hazardous materials", "toxic
materials" or "toxic substances" under any applicable
governmental law, regulation and/or requirement.
(b) Westgate hereby represents and warrants to Buyer
as follows, all of which shall be true and correct at and as of
May 12, 1994:
(1) Westgate is a general partnership duly formed
and validly existing under the laws of the State of Florida, and
is in good standing in the State of Florida, with full and
complete authority to enter into this Agreement and to consummate
the transactions contemplated herein. Westgate has obtained all
consents with respect to the execution by Westgate of this
Agreement and the performance by Westgate of its obligations
under this Agreement.
(2) Westgate has not received written notice from
any governmental authority of proceedings relating to the use,
occupancy, maintenance or operation of the Westgate Property.
(3) Westgate has not notified any Tenant under
the Westgate Leases that such Tenant is in default thereunder for
failure to pay monetary obligations; Westgate has not received
written notice that Westgate is in material default under any of
the Westgate Leases; Westgate has no actual knowledge that
Westgate is in material default under any of the Westgate Leases;
and Westgate has no actual knowledge that any Westgate Anchor
Tenant is in default under the terms of its applicable lease or
that there exists any event which except for the passage of time
or otherwise would constitute a default under any Westgate Anchor
Tenant lease.
(4) Westgate has not notified any contractor
under the Westgate Contracts that it is in default thereunder,
and Westgate has not received written notice that Westgate is in
default under any of the Westgate Contracts.
(5) Westgate has not received written notice of
the existence of any charges, assessments or liens for public
improvements concerning the Westgate Property which remain
unpaid.
(6) To the extent any improvements which might
form the basis of mechanics' or materialmen's liens have been
made or will be made to the Westgate Property prior to Closing,
Westgate agrees to keep the Westgate Property free from liens
which might result from such improvements.
(7) Other than as set forth in the Litigation
Schedule attached hereto as Exhibit "K-2", Westgate has not
received written notice of any pending adverse claim, or
judicial, municipal or administrative proceedings affecting the
Westgate Property or any portion thereof, including without
limitation, proceedings for or involving collections,
condemnations, eminent domain, alleged building code or zoning
violations, or personal injuries or property damage alleged to
<PAGE> 21
have occurred on the Westgate Property or by reason of the
condition or use of the Westgate Property.
(8) Westgate has received no written notice from
any insurance carrier of the existence of defects or inadequacies
in the Westgate Property.
(9) Westgate is not a "foreign person" and will
deliver to Buyer at Closing, an affidavit certifying that it is
not a "foreign person" within the meaning of the Internal Revenue
Code of 1986, as amended, in the form attached hereto as
Exhibit "L-2".
(10) There are no leases or any other tenancies
for any space in the Westgate Property other than those set forth
on Exhibit "C-2" attached hereto, and the rent roll attached
hereto as part of Exhibit "C-2" is true and correct in all
material respects.
(11) There are no contracts relating to the
Westgate Property other than those set forth on Exhibit "B-2"
attached hereto.
(12) Westgate has received no notice in writing of
violation of any zoning, building, environmental or any other
land use ordinances and regulations affecting the Westgate
Property or the business being conducted thereon.
(13) Westgate does not employ workers in
connection with the operation of the Westgate Property.
(14) Westgate shall be solely responsible for any
leasing commissions payable under the Westgate Leases.
(15) Westgate shall be responsible for the payment
of all sales tax due for rental received by Westgate for the
Westgate Property through the Closing Date, and will file all
appropriate forms in connection therewith, in accordance with
Section 12A-1.055, Florida Administrative Code, and Section 212,
Florida Statutes.
(16) Westgate will maintain its current levels of
insurance coverages for hazard insurance and general liability
insurance through the Closing Date.
(17) Westgate has not used the Westgate Property
to generate, manufacture, refine, transport, treat, store, handle
or dispose of Hazardous Material, and to its actual knowledge has
not received a summons, citation, directive, letter or other
communication, written or oral, from any agency or Department of
the State of Florida or the U.S. Government concerning any
intentional or unintentional action or omission on Westgate's
part which resulted in the releasing, spilling, leaking, pumping,
pouring, emitting, emptying or dumping of Hazardous Material on
the Westgate Property. "Hazardous Material" shall mean any
flammable or explosive materials, petroleum or petroleum
products, natural gas or synthetic gas usable for fuel,
radioactive materials, hazardous wastes or substances or toxic
wastes or substances, including without limitation, any
substances now or hereafter defined as
<PAGE> 22
or included in the definition of "hazardous substances",
hazardous wastes", hazardous materials", "toxic materials" or
"toxic substances" under any applicable governmental law,
regulation and/or requirement.
(c) Countryside and Westgate agree to renew the
foregoing representations and warranties at the Closing Date to
the extent such representations and warranties shall remain true
and correct to their respective actual knowledge at and as of the
Closing Date. If any of the foregoing representations and
warranties become inaccurate between May 12, 1994, and the
Closing Date, Countryside and/or Westgate shall notify Buyer of
such change and forward to Buyer supporting documentation, if
any. Within five (5) days after notice from Countryside and/or
Westgate, if such change (other than a change to the warranties
and representations set forth in Paragraphs 8(a)(3), 8(a)(10),
8(b)(3) and 8(b)(10)), has a financially adverse affect on the
transaction as contemplated by this Agreement, then Buyer shall
have the right: (1) to terminate this Agreement and receive a
return of the Deposit, or (2) to proceed with Closing without
abatement of the Purchase Price; provided, that if such change in
the representation or warranty can be remedied by the payment of
money not in excess of One Hundred Thousand Dollars ($100,000.00)
in the aggregate, Buyer shall have the right to proceed to
Closing and require that Sellers remedy such change so that it
becomes accurate. The failure of Buyer to respond within the
foregoing five (5) day period shall be deemed to constitute
Buyer's consent to proceed with Closing. If Buyer notifies
Sellers of its decision to terminate this Agreement, then Sellers
shall have the right, at their sole and exclusive discretion,
within the period of time prior to Closing, to remedy or
eliminate the adverse matter. If Sellers so elect, Sellers shall
notify Buyer within five (5) business days, in which event Buyer
shall not have the right to terminate this Agreement during the
remedial period; provided, however, that if such adverse matter
is not cured to Buyer's reasonable satisfaction by the Closing
Date, then Buyer shall have the right to terminate this
Agreement. Buyer's termination of this Agreement and the return
of the Deposit shall constitute the sole and exclusive remedy of
Buyer.
(d) Buyer hereby represents and warrants to Sellers,
at and as of the Execution Date and the Closing Date, that:
(1) Buyer is a corporation duly formed and
validly existing under the laws of the State of Georgia, is
qualified to do business in the State of Florida, is in good
standing in the State of Florida with full and complete authority
to enter into this Agreement and to consummate the transactions
contemplated herein.
(2) Buyer has obtained all consents with respect
to the execution by Buyer of this Agreement and the performance
by Buyer of its obligations hereunder.
(3) Buyer has operated and intends to continue to
operate as a real estate investment trust in accordance with the
Internal Revenue Code of 1986, as amended, and the regulations
promulgated thereunder.
<PAGE> 23
(e) (1) The parties hereto acknowledge and agree
that: (a) Buyer's rights to sue on account of any of the
representations and warranties shall survive the consummation of
the transactions for a period of six (6) months after Closing,
(b) Buyer must notify Sellers in writing prior to the expiration
of such six (6) month period of Sellers' breach of any such
representation or warranty, and (c) any action for a breach
thereunder must be commenced within seven (7) months from the
Closing (i.e., one (1) month in excess of such six (6) month
period).
(2) After the expiration of: (a) such six (6)
month period without Buyer having notified Sellers in writing of
Sellers' breach of any such representation or warranty, or
(b) such seven (7) month period (if Buyer has notified Sellers in
writing of Sellers' breach of any representation or warranty
within the six (6) month period) without Buyer having commenced
an action against Sellers for a breach thereunder, the
representations and warranties set forth herein shall terminate
and become null and void. To the extent that Buyer notifies
Sellers and/or commences an action within the foregoing time
periods, all remaining representations and warranties for which
notice is not given and/or an action commenced shall terminate
and become null and void.
(f) (1) As security for Sellers' warranties and
representations set forth in Paragraphs 8(a) and 8(b) and for any
obligations of Seller under Paragraph 4(b)(ii), a portion of the
Purchase Price in the amount of Two Hundred Fifty Thousand
Dollars ($250,000) ("Warranty Escrow Holdback") shall be
delivered to Escrow Agent at Closing to be held in an
interest-bearing escrow account in a bank or other financial
institution. At Closing, Buyer and Sellers shall execute an
escrow agreement with Escrow Agent in the form attached hereto as
Exhibit "N-2".
(2) All or any interest earned on the Warranty
Escrow Holdback shall accrue to the benefit of Sellers, and be
payable to Sellers unless within: (a) the six (6) month period
described in Paragraph 8(e)(2)(a) Buyer shall have notified
Seller in writing, and (b) the seven (7) month period described
in Paragraph 8(e)(2)(b) Buyer shall have commenced an action
against Seller, in which event interest earned on the Deposit
shall accrue to the benefit of and be payable to the party
entitled to receive the Warranty Escrow Holdback pursuant to the
terms and conditions of this Agreement.
(3) Escrow Agent shall immediately refund to
Sellers the Warranty Escrow Holdback along with all interest
accrued thereon after the expiration of: (a) the six (6) month
period described in Paragraph 8(e)(2)(a) without Buyer having
notified Seller in writing, or (b) the seven (7) month period
described in Paragraph 8(e)(2)(b) without Buyer having commenced
an action against Seller.
(4) The parties acknowledge and agree that:
(a) One Hundred Sixty-Four Thousand Dollars ($164,000) of the
Warranty Escrow Holdback is allocated to the Countryside
Property, and (b) Eighty-Six Thousand Dollars ($86,000) of the
Warranty Escrow Holdback is allocated to the Westgate Property.
<PAGE> 24
(5) For purposes thereof, the employer
identification number of Countryside is 23-2340374, and Westgate
is 23-2250222.
9. Access to the Property. Buyer and/or its agents and
representatives shall have the right, during normal business
hours and after reasonable advance notice, to enter upon the
Countryside Property and Westgate Property at any time prior to
the Closing Date, accompanied by an agent of Sellers, for
purposes of conducting such inspections, investigations and/or
studies as Buyer deems reasonably necessary. Buyer's access to
the Countryside Property and Westgate Property shall be subject
to the rights of the Tenants and Buyer shall not unreasonably
disturb any of the Tenants in conducting its inspections, tests
and studies. Buyer shall not engage in any activity in or about
the Property which directly or indirectly violates the terms of
any governmental or quasi-governmental statute, rule, regulation,
order or practice. Buyer shall not make any material physical
changes to the Countryside Property or the Westgate Property. If
Buyer violates its obligations under this Paragraph 9 or in the
event of any physical damage to the Countryside Property,
Westgate Property, any Personal Property, or any other aspect of
the Property resulting, directly or indirectly, from the exercise
by Buyer of its rights under this Paragraph 9, Buyer hereby
agrees to restore such Countryside Property, Westgate Property,
Personal Property or such other aspect of the Property, to its
condition prior to incurring such damage and shall indemnify and
hold harmless Sellers from and against all physical damage to the
Countryside Property and Westgate Property, personal injury,
and/or any other claims or liability which may occur as a direct
or indirect result of Buyer's tests and investigations. The
provisions of this Paragraph 9 shall survive Closing or other
termination of this Agreement.
10. Closing. The closing of the acquisition of the
Property (the "Closing") shall be held either at the offices of:
(a) Buyer at 200 Galleria Parkway, Suite 1400, Atlanta, Georgia,
or (b) Blank, Rome, Comisky & McCauley, 1401 Forum Way,
7th Floor, West Palm Beach, Florida, or (c) such other mutually
agreed upon location on the Closing Date. Closing shall be held
at the location set forth in Paragraph 10(a) unless Buyer
provides Seller with five (5) days prior written notice of an
alternate location in accordance with the terms hereof. Time
shall be of the essence in effecting the Closing as provided
herein. The Closing shall begin at 10:00 A.M. on the Closing
Date.
11. Damage by Fire or Other Casualty; Condemnation.
(a) Sellers shall promptly notify Buyer of any
casualty damage or notice of condemnation which Sellers receive
between the Execution Date and the Closing Date. Sellers shall
timely notify any insurance companies with respect to any damage
and shall promptly submit claims for such damage.
(b) (1) Subject to the provisions of
Paragraph 13(a)(5)(A) below, if (A) any portion of the
Countryside Property is damaged by fire or casualty after the
Execution Date and is not repaired and restored substantially to
its original condition prior to Closing, and (B) at the
<PAGE> 25
time of Closing the aggregate of the estimated cost of repairs is
Five Hundred Thousand Dollars ($500,000.00) or less, then Buyer
shall be required to purchase the Countryside Property in
accordance with the terms of this Agreement and, at Closing,
Countryside shall assign to Buyer all insurance claims and
proceeds with respect thereto and shall pay or credit to Buyer
the amount of any deductible or uninsured loss with respect to
such casualty pursuant to such adjustment. If at the time of
Closing the aggregate of the estimated cost of repairing such
damage is more than Five Hundred Thousand Dollars ($500,000.00),
then Buyer may, at its sole option: (C) terminate this Agreement
by notice to Sellers, in which event the Deposit shall be
returned to Buyer and no party shall have any further liability
to any other party under this Agreement, or (D) proceed to
Closing and, at Closing, Countryside shall assign to Buyer all
insurance claims and proceeds with respect thereto and shall pay
or credit to Buyer the amount of any deductible or uninsured loss
with respect to such casualty pursuant to such adjustment.
(2) Subject to the provisions of
Paragraph 13(a)(5)(B) below, if (A) any portion of the Westgate
Property is damaged by fire or casualty after the Execution Date
and is not repaired and restored substantially to its original
condition prior to Closing, and (B) at the time of Closing the
aggregate of the estimated cost of repairs is Five Hundred
Thousand Dollars ($500,000.00) or less, then Buyer shall be
required to purchase the Westgate Property in accordance with the
terms of this Agreement and, at Closing, Westgate shall assign to
Buyer all insurance claims and proceeds with respect thereto and
shall pay or credit to Buyer the amount of any deductible or
uninsured loss with respect to such casualty pursuant to such
adjustment. If at the time of Closing the aggregate of the
estimated cost of repairing such damage is more than Five Hundred
Thousand Dollars ($500,000.00), then Buyer may, at its sole
option: (C) terminate this Agreement by notice to Sellers, in
which event the Deposit shall be returned to Buyer and no party
shall have any further liability to any other party under this
Agreement, or (D) proceed to Closing and, at Closing, Westgate
shall assign to Buyer all insurance claims and proceeds with
respect thereto and shall pay or credit to Buyer the amount of
any deductible or uninsured loss with respect to such casualty
pursuant to such adjustment.
(c) If, prior to Closing, the Property or any part
thereof is taken by eminent domain, this Agreement shall become
null and void at Buyer's option, and upon receipt by Sellers of
written notice of an election by Buyer to treat this Agreement as
null and void, the Deposit shall be returned to Buyer. If Buyer
elects to proceed and to consummate the purchase despite said
taking (such election being deemed to have been made unless Buyer
notifies Sellers to the contrary within five (5) days after
notice from either of Sellers to Buyer of any taking), there
shall be no reduction in or abatement of the Purchase Price, and
Sellers shall assign to Buyer all of Sellers' right, title and
interest in and to any award made or to be made in the
condemnation proceeding. If Buyer elects to proceed to Closing
despite a taking, Sellers shall not finalize any settlement
agreement with any taking authority relating to the Countryside
Property or the Westgate Property without the prior written
consent of Buyer, which shall not be
<PAGE> 26
unreasonably withheld or delayed.
12. Default.
(a) If Buyer shall fail to complete Closing in
accordance with the terms of this Agreement, then, as Sellers'
sole and exclusive remedy therefor, Sellers shall be entitled to
retain the Deposit as liquidated and agreed upon damages for the
losses and injuries which Sellers shall have sustained and
suffered as a result of Buyer's default, and, thereupon, this
Agreement shall be terminated. It is agreed that the provisions
of this Paragraph 12(a) for liquidated and agreed upon damages
are a bona fide provision for such and are not a penalty, the
parties understanding that by reason of the withdrawal of the
Property from sale to the general public at a time when other
parties would be interested in purchasing the Property, that
Sellers shall have sustained damages which will be substantial,
but will not be capable of determination with mathematical
precision. Therefore, this provision for liquidated and agreed
upon damages has been incorporated as part of this Agreement as a
provision beneficial to both parties.
(b) If Sellers willfully fail or refuse to deliver the
Deeds or other items described in Paragraph 5 hereof in default
hereof, upon Buyer's (1) tender of the full Purchase Price and
(2) compliance with the terms and conditions of this Agreement,
Buyer shall have the sole option of either (i) terminating this
Agreement and receiving the return of the Deposit, in which event
Sellers shall be released and relieved of any further liability
and this Agreement shall thereupon be null and void; or
(ii) bringing an equitable action against Sellers for specific
performance. Notwithstanding the foregoing in this
Paragraph 12(b), if Buyer is not in default under the provisions
of this Agreement and either Countryside sells the Countryside
Property and/or Westgate sells the Westgate Property, to a third
party in breach of the provisions of this Agreement, then Buyer
shall have the right to bring an action against Sellers to
recover damages incurred by Buyer. The remedies set forth herein
shall be Buyer's sole remedies pursuant to this Agreement, shall
become null and void, except as otherwise expressly provided
hereunder, if Closing occurs, and shall not apply to a defect in
title, the remedies for which are set forth in Paragraph 4(b)
hereof.
13. Buyer's Conditions Precedent/Buyer's Rights.
(a) Notwithstanding anything contained herein to the
contrary, Buyer's obligation to close hereunder is contingent
upon the satisfaction of the following conditions:
(1) As of the Closing Date, title to the Property
shall be as required by Paragraphs 4(a) and 4(b) of this
Agreement.
(2) All of the representations and warranties of
Sellers set forth in Paragraphs 8(a) and 8(b) of this Agreement
shall be true and correct as of the Closing Date, as updated.
(3) No Anchor Tenant has made an assignment for
the benefit of creditors, has applied, petitioned, or filed for
the
<PAGE> 27
appointment of a custodian, trustee, receiver or agent to take
possession of any property or chattels of such Anchor Tenant, is
not generally paying its debts as such debts become due, is
"insolvent" as that term is defined in the United States
Bankruptcy Code, or has filed a petition with the United States
Bankruptcy Court under the United States Bankruptcy Code or
commenced any proceeding under any bankruptcy or reorganization
statute or under any arrangement, insolvency, readjustment of
debt, dissolution or liquidation statute of any jurisdiction.
(4) No Anchor Tenant has ceased operations,
terminated its lease with Sellers, ceased making rental payments
or notified Sellers of its intention to do any of the foregoing.
(5) (A) No casualty has occurred at the
Countryside Property for which the estimated cost of repairs
exceeds Five Hundred Thousand Dollars ($500,000.00), and no
casualty has occurred at the Countryside Property which would
permit a Countryside Anchor Tenant to terminate its lease.
(B) No casualty has occurred at the Westgate
Property for which the estimated cost of repairs exceeds Five
Hundred Thousand Dollars ($500,000.00), and no casualty has
occurred at the Westgate Property which would permit a Westgate
Anchor Tenant to terminate its lease.
(6) There has not been a taking (as such term is
defined in Paragraph 11(c)) of all or a part of the Countryside
Property and/or the Westgate Property.
(7) Seller is prepared to deliver to Buyer the
closing documents (as described in Paragraph 5(a)).
(8) Shell Oil Company and Chase Federal Savings
Bank have consented to the use restrictions affecting their
future development of the parcels they own, respectively,
adjacent to the Westgate Property, by executing those certain
instruments which are attached hereto as part of Exhibit "O".
(b) If any of the foregoing conditions precedent in
Paragraph 13(a) are not satisfied on the Closing Date, Buyer may,
at Buyer's sole option:
(1) terminate this Agreement, whereupon the
Deposit shall be returned promptly to Buyer and Sellers shall be
released of all further rights and obligations hereunder; or
(2) waive such condition, in whole or in part,
which waiver shall automatically occur if Closing occurs.
(c) If Buyer elects to terminate this Agreement
pursuant to the provisions under Paragraph 13(b)(1) above, then
within forty-eight (48) hours after such termination, Buyer shall
deliver to Sellers any materials or other property of Sellers in
Buyer's possession, and the
<PAGE> 28
results and copies of any tests, surveys and the like performed
at the Property, and upon Sellers' receipt of such materials, the
Deposit shall be returned to Buyer, this Agreement shall be null
and void, and the parties shall have no further liability
hereunder except as otherwise provided herein.
14. Operations Prior to Closing. Sellers agree to operate
the Property between the Execution Date and the Closing Date, in
the same general manner as it was being operated on the Execution
Date and in the ordinary course of business. Notwithstanding the
foregoing, after May 12, 1994, Sellers shall not execute any new
leases or contracts, modify, amend, extend, terminate or cancel
any Leases or Contracts, or grant concessions to any Tenants
without the prior written consent of Buyer, which may be given at
Buyer's sole discretion, but to be deemed to have been given if
Buyer does not respond to any such notice within five (5) days
after it is sent.
15. Purchase "AS-IS". Except as otherwise provided in this
Agreement, Buyer hereby acknowledges and agrees, which agreement
shall survive Closing hereunder, that Sellers have afforded Buyer
with full and complete opportunity to make its own independent
investigation of the Property, the Contracts, Licenses, Leases,
utilities and the availability and cost thereof, and of all
financial and other matters pertaining thereto, and that Buyer is
acquiring the Property based solely upon such independent
investigation in "AS-IS" condition on the Closing Date. Buyer
acknowledges receipt (or access to) and review of the documents
and information referenced herein and in the exhibits and
schedules to this Agreement prior to its execution hereof. The
provisions of this Paragraph 15 shall survive Closing hereunder.
16. Brokers.
(a) Sellers represent to Buyer that Sellers have dealt
with no real estate broker, dealer or salesman in connection with
the subject transaction other than Atlantic American Group, Inc.
(through their agent Orme Miller) ("Broker"), whose remuneration
Sellers, in accordance with the Broker's Acknowledgment attached
hereto, have agreed to pay. Buyer represents to Sellers that
Buyer has dealt with no real estate brokers, dealers or salesmen
in connection with the subject transaction other than Broker.
(b) Sellers shall and hereby agree to indemnify,
defend, and hold Buyer harmless from and against any loss,
damage, or claim resulting from a breach of the representations
of Sellers set forth in Paragraph 16(a) hereof and for any claim
of commission which any other broker might make against Buyer
because of its dealings with Seller. Buyer shall and hereby
agrees to indemnify, defend and hold Sellers harmless from and
against any loss, damage, or claim resulting from the breach of
the representations of Buyer set forth in Paragraph 16(a) hereof
and for any claim of commission which any other broker might make
against Sellers because of its dealings with Buyer.
(c) The provisions of this Paragraph 16 shall survive
Closing hereunder, or any other termination of this Agreement.
<PAGE> 29
17. Notices. All notices, demands, requests or
communication required or permitted to be given pursuant to this
Agreement shall be in writing and shall be deemed to have been
properly given or served and shall be effective upon being
deposited in the United States mail, postage prepaid and
certified with return receipt requested, upon delivery by an
internationally recognized overnight delivery service, or upon
the date of receipt of a telecopy which is received any business
day on or before 5 P.M. in the location of receipt or on the next
day after receipt if received by telecopy after 5 P.M. on any
business day; provided, however, the time period in which a
response to any notice, demand or request must be given shall
commence on the next business day after such posting. Any such
notice, demand, request or communication if given to Sellers
shall be addressed as follows:
To the Sellers: c/o Radnor Development Corporation
501 N. A1A, Suite 204
Jupiter, FL 33477
Attention: Stephen H. Osburn
Telephone No.: 407-746-0197
Telecopy No.: 407-575-9819
With a copy to: Blank, Rome, Comisky, & McCauley
1200 Four Penn Center Plaza
Philadelphia, PA 19103
Attention: Matthew J. Comisky, Esquire
Telephone No.: 215-569-5678
Telecopy No.: 215-569-5555
and, if given to Buyer, shall be addressed as follows:
To the Buyer: 200 Galleria Parkway, Suite 1400
Atlanta, GA 30339
Attention: Lee A. Harris, Esquire
Telephone No.: 404-955-4406
Telecopy No.: 404-988-8773
18. Successors and Assigns. Buyer may not assign this
Agreement or any rights herein or any portion hereof without the
prior written consent of Sellers, which may be withheld for any
reason or for no reason.
19. Counterparts. This Agreement may be executed in
several counterparts, each of which shall be deemed an original
and all of which counterparts together shall constitute one and
the same instruments.
20. Time of the Essence. Time is of the essence of this
Agreement. If any time period or date ends on a day or time
which is not a Business Day, such period shall be extended to the
same time on the next Business Day.
21. Judicial Interpretation. Should any provision of this
Agreement require judicial interpretation, it is agreed that the
court interpreting or construing the same shall not apply a
presumption that the terms hereof shall be more strictly
construed against one party by reason of the rule of construction
that a document is to be construed more strictly against the
party who itself or through its agent prepared
<PAGE> 30
the same, it being agreed that the agents of all parties have
participated in the preparation of this Agreement.
22. Captions and Recitals. The captions contained herein
are not a part of this Agreement and are included solely for the
convenience of the parties.
23. Entire Agreement. This Agreement contains the entire
agreement between the parties relating to the acquisition of the
Property, all prior negotiations between the parties are merged
by this Agreement and there are no promises, agreements,
conditions, undertakings, warranties or representations, oral or
written, express or implied, between them other than as herein
set forth. No change or modification of this Agreement shall be
valid unless the same is in writing and signed by the parties
hereto. No waiver of any of the provisions of this Agreement, or
any other agreement referred to herein, shall be valid unless in
writing and signed by the party against whom it is sought to be
enforced.
24. Miscellaneous.
(a) Subject to the provisions of Paragraph 27(b)(2),
neither this Agreement nor any memorandum thereof shall be
recorded in the Public Records of Broward County, Florida or in
any other office or place of record, and the placement of this
Agreement or any memorandum hereof in any place of record shall
automatically render this Agreement null and void.
(b) The parties acknowledge and agree that the Escrow
Agent shall have the right to interplead with the Courts in and
for the Broward County, Florida, all or any portion of the
Deposit received by it pursuant to this Agreement in the event of
any dispute concerning the Deposit. The parties further agree to
equally indemnify, defend and save the Escrow Agent harmless from
any claims or damages incurred by it (including reasonable
attorneys' fees and costs) arising from the performance of its
duties as escrow agent hereunder. This indemnification shall
survive the Closing or other termination of this Agreement. The
Escrow Agent shall have no liability with regard to any duty as
escrow agent under this Agreement, nor be responsible for the
loss of any monies held by it, except in the event of willful
misconduct or gross negligence on the part of the Escrow Agent.
Notwithstanding its duties as an escrow agent, Escrow Agent shall
have the right to represent the Sellers or Buyer in connection
with this transaction.
(c) Upon Sellers' execution of this Agreement, Sellers
shall not thereafter execute any letter of understanding, letter
of intent or other agreement on behalf of Sellers (or either of
them) with any other potential purchaser of the Property unless
and until either Buyer has defaulted in its obligations under
this Agreement, or Sellers or Buyer have terminated this
Agreement in accordance with the terms and provisions hereof.
25. Governing Law; Venue.
(a) This Agreement is being delivered and is intended
to be performed in the State of Florida, and the laws of the
State of Florida
<PAGE> 31
shall govern the rights and duties of the parties hereto and the
validity, construction, enforcement and interpretation of this
Agreement.
(b) With regard to any litigation arising out of or
involving this Agreement, each party hereto: (1) irrevocably
submits to the jurisdiction of the state and federal courts of
the State of Florida and agrees and consents to service of
process being made upon it in any legal proceeding arising out of
or in connection herewith by service of process provided by
Florida law; (2) irrevocably waives, to the fullest extent
permitted by law, any objection which it now or hereafter may
have to the laying of venue of any litigation arising out of or
in connection with this Agreement brought in the United States
District Court for the Southern District of Florida or in the
Circuit Court in and for Broward County, Florida; (3) irrevocably
waives any claims that any litigation brought in any such court
has been brought in an inconvenient forum; (4) irrevocably
consents to the service of process out of the aforementioned
court in any such litigation by the delivery of copies thereof in
accordance with the notice provisions set forth in this
Agreement, to such party at its address set forth herein; and
(5) irrevocably agrees that any legal proceeding against any
party hereto arising out of or in connection with this Agreement
shall be brought in either the United States District Court for
the Southern District of Florida or in the Circuit Court in and
for Broward County, Florida.
26. Attorneys' Fees. If any action or dispute arises
related to or as a result of this Agreement, the prevailing party
shall be entitled to recover court costs and fees of attorneys
and professional assistants (whether in court or out), through
all appellate levels and in any administrative or arbitration
hearings.
27. Confidentiality.
(a) Except with the prior written consent of the
other, neither Sellers nor Buyer shall make any public
disclosure, including any publication, radio or television
announcements or other similar form of disclosures, except with
the prior written consent of the other, of any information
concerning the Purchase Price for the Property, and/or any
information concerning the condition of the Property or of the
financial terms and considerations of the underlying transaction.
Furthermore, all parties shall exercise its best efforts to
require that its employees and agents comply with the foregoing.
(b) Notwithstanding the foregoing in Paragraph 27(a):
(1) Sellers agree to cooperate with Buyer in the issuance of a
press release concerning Buyer's proposed acquisition of the
Property pursuant to this Agreement, and agrees not to
unreasonably withhold their consent to any such press release;
(2) Buyer shall be permitted to disclose information to the
United States Securities and Exchange Commission and/or the New
York Stock Exchange in connection with its making required
disclosures; and (3) Buyer shall be permitted to disclose
information to such other parties to the extent required by law.
<PAGE> 32
28. Estoppel Certificates.
(a) (1) Sellers shall request estoppel certificates
in substantially the forms set forth on Exhibits "M-1" and "M-2",
as such forms may be modified on an individual basis to comport
with the circumstances of an individual tenancy (a "Tenant
Estoppel"), from each of the Tenants under the Leases, and
Sellers shall contemporaneously deliver to Buyer true, correct
and complete copies of all Leases (and any riders, amendments and
side letters modifying any business terms thereof) attached to
the Tenant Estoppels. Sellers shall not be required to obtain
and deliver to Buyer a Tenant Estoppel from a Tenant whose lease
expires prior to the Closing Date.
(2) Sellers shall use commercially reasonable
efforts to deliver on or before the Closing Date a Tenant
Estoppel from all Tenants. In conjunction therewith, Sellers
shall be required to deliver to Buyer, within five (5) days prior
to the Closing Date, a Tenant Estoppel from at least: (a) all
Anchor Tenants, and (b) all other Tenants (other than Anchor
Tenants) leasing at least seventy percent (70%) of the remaining
leased square footage in the Property under the Leases
(collectively, the "Estoppel Standard").
(3) If Sellers fail to deliver Tenant Estoppels
sufficient to satisfy the Estoppel Standard within five (5) days
prior to the Closing Date, then Buyer shall either (i) accept the
Tenant Estoppels delivered to Buyer (along with Sellers'
Estoppels for the remaining Tenants to be delivered at Closing),
and the parties shall proceed to Closing without abatement of the
Purchase Price, subject and pursuant to the other terms of this
Agreement, or (ii) terminate this Agreement by giving notice to
Sellers at least one (1) day prior to the Closing Date. If Buyer
duly exercises such right of termination, Escrow Agent shall
return the Deposit to Buyer, this Agreement shall be null and
void, and neither party shall have any further obligations
hereunder. If Buyer fails to notify Seller as provided above or
does not duly exercise such right to terminate this Agreement,
Buyer shall be deemed to have waived its right to do so and
Closing shall occur as described in this Agreement, without
postponement or reduction of the Purchase Price.
(4) If Sellers satisfy the Estoppel Standard but
do not obtain Tenant Estoppels from all Tenants under the Leases,
both Countryside and Westgate, to the extent applicable, shall
provide to Buyer their own estoppel in substantially the forms
set forth on Exhibits "M-3" and "M-4" (respectively the
"Countryside Estoppel" and "Westgate Estoppel", and sometimes
referred to collectively as the "Sellers' Estoppels") for all of
the Tenants under the Leases as to which Sellers do not deliver a
Tenant Estoppel. The Countryside Estoppel and Westgate Estoppel
shall survive for a period expiring on the earlier of (a) the
date Sellers deliver to Buyer a Tenant Estoppel from the
appropriate tenant substantiating the information set forth in
the applicable Sellers' Estoppel, (b) the date the applicable
Lease expires, or (c) six (6) months from the Closing Date.
(5) Buyer specifically releases Sellers from all
liability and obligation whatsoever if any of the Tenants
modifies the form of, or refuses to execute or provide all of the
information
<PAGE> 33
required by, the Tenant Estoppel. Sellers make no representation
or warranty whatsoever, express or implied, as to the content,
completeness or accuracy of any of the information set forth in
any Tenant Estoppel.
(b) The procedure set forth in this Section 28 shall
be Buyer's sole rights and remedies with regard to any such
objections. Buyer shall have no right to take any other action
or assert any claim or cause of action against Sellers based upon
any such objection.
(c) The parties hereto acknowledge that Sellers shall
not be required to obtain more than one set of estoppel letters
for the benefit of Buyer.
29. Sellers' Liability. Anything contained in this
Agreement to the contrary notwithstanding, Sellers' aggregate
liability hereunder shall not exceed the sum of Two Hundred Fifty
Thousand Dollars ($250,000.00), except with regard to the matters
set forth in Paragraph 6 and to matters specifically set forth in
the Deeds, Bills of Sale, Assignments and Sellers' Estoppels
which are intended to survive Closing hereunder.
30. Buyer's Audit/Accounting for CAM Charges.
(a) Sellers acknowledge that Buyer may be required by
the Securities and Exchange Commission to file audited financial
statements for the year 1993 with regard to the Property.
Sellers shall (i) cooperate with Buyer, its counsel, accountants,
agents and representatives, provide them with access to Sellers'
books and records with respect to the ownership, management,
maintenance and operation of the Property for the year 1993, and
permit them to copy the same, (ii) execute a form of "rep" letter
satisfactory to Sellers as may be requested by Buyer's
accountants, and (iii) furnish Buyer with such additional
information concerning the same as Buyer may reasonably request.
Any such audit must be completed within sixty (60) days after the
Closing, and Buyer will pay the costs associated with any such
audit. The terms of this Paragraph 30 shall survive closing
hereunder for a period of sixty (60) days.
(b) Sellers shall deliver to Buyer, within ninety (90)
days from the Closing Date, statements prepared by or on behalf
of Sellers setting forth the actual amount of the CAM Charges for
the Countryside Property and the Westgate Property, respectively,
for the period commencing January 1, 1994, and ending on the
Closing Date, along with appropriate supporting documentation to
substantiate the statements and evidence of billing to Tenants.
31. Hart-Scott-Rodino Filing. If Buyer and/or Sellers
reasonably conclude that a filing is required by federal law to
comply with the requirements of Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended, and the rules and
regulations promulgated thereunder (the "HSR Act"), then Sellers
and Buyer shall promptly file the Notifications and Report Forms
required of both under the HSR Act with the Federal Trade
Commission and the Antitrust Division of the Department of
Justice with respect to the transactions contemplated by this
Agreement. Seller and Buyer shall each notify the other when
such Notifications and Report Forms have been filed, and each
party shall be responsible for their
<PAGE> 34
independent costs associated with obtaining the necessary waivers
or approvals concerning such filing.
32. Westgate Dry Cleaning Escrow.
(a) The parties acknowledge and agree that a portion
of the Purchase Price in the amount of Fifty Thousand Dollars
($50,000) ("Dry Cleaning Escrow Holdback") shall be delivered to
Escrow Agent at Closing to be held in an interest-bearing escrow
account in a bank or other financial institution for the purpose
of addressing Buyer's concerns regarding possible contamination
on the Westgate Property arising from the operation of a dry
cleaning operation thereon. The Dry Cleaning Escrow Holdback,
along with all interest accrued thereon, shall be returned to
Westgate at such time as the Florida legislature approves a
program providing amnesty for similar problems of dry cleaning
operations in shopping centers (a version of which is currently
under consideration), and is available for use in connection with
the Westgate Center. If, within two (2) years from the Closing
Date, the amnesty legislation is: (1) not approved, or (2) is
approved but does not address the similar problem of dry cleaning
operations in shopping centers, or (3) is approved but provides
only a partial (and not complete) amnesty (e.g., a limited clean-
up obligation is imposed), and Buyer reasonably believes
remediation (i.e., removal of contaminents) is required to
alleviate the possible contamination, then portions of the Dry
Cleaning Escrow Holdback may be distributed by Escrow Agent to
Buyer up to a maximum of the Dry Cleaning Escrow Holdback (as
evidenced by back-up delivered by Buyer to Escrow Agent and
Westgate), with any excess amounts to be returned to Westgate.
At Closing, Buyer and Westgate shall execute an escrow agreement
with Escrow Agent substantially similar to the form which is
attached hereto as Exhibit "N-3".
(b) All or any interest earned on the Dry Cleaning
Escrow Holdback shall accrue to the benefit of Sellers, and be
payable to Sellers unless Buyer is entitled thereto pursuant to
the terms of Paragraph 32(a) above.
(c) From and after the Closing Date, Buyer shall:
(1) release Westgate from any liability regarding the possible
contamination on the Westgate Property arising from the operation
of a dry cleaning operation thereon and agrees not to sue
Westgate in connection therewith, and (2) indemnify, defend and
hold Westgate harmless from and against any and all claims,
costs, suits, fires, expenses or liability whatsoever, including
Westgate's attorneys' fees, in connection with any claims
regarding possible contamination on the Westgate Property arising
from the operation of a dry cleaning operation thereon and the
possible contamination.
(d) The parties acknowledge and agree that the entire
Dry Cleaning Escrow Holdback is allocated to the Westgate
Property.
(e) For purposes thereof, the employer identification
number of Westgate is 23-2250222.
(f) The provisions of this Paragraph 32 shall survive
Closing hereunder.
<PAGE> 35
33. Radon Testing. Radon is a naturally occurring
radioactive gas that, when it has accumulated in a building in
sufficient quantities, may present health risks to persons who
are exposed to it over time. Levels of radon that exceed federal
and state guidelines have been found in buildings in Florida.
Additional information regarding radon testing may be obtained
from any county public health unit. Buyer acknowledges that
Sellers have not tested the Property for the potential production
of radon gas, and Sellers make no representation to Buyer of the
existence or non-existence of the potential for production of
radon gas from the Property.
<PAGE> 36
34. Acceptance Date. This Agreement shall be null and void
and of no further force and effect unless a copy of the same
executed by Seller and Buyer are delivered to Buyer and Seller by
the close of business on May 31, 1994.
IN WITNESS WHEREOF, intending to be legally bound hereby,
the parties have duly executed this Agreement as of the day and
year first above stated.
WITNESS: SELLERS:
COUNTRYSIDE SHOPS,
a Florida general partnership
By: RADNOR/COOPER CITY
CORPORATION, a Delaware
corporation
/s/DANA M. KIRK By: /s/STEPHEN H. OSBURN
- - ----------------- --------------------
STEPHEN H. OSBURN,
President
/s/SUSAN L. CASAS [Corporate Seal]
- - -----------------
Date of Execution: May 31, 1994
WESTGATE SQUARE,
a Florida general partnership
By: RADNOR/WESTON CORPORATION,
a Delaware corporation
/s/DANA M. KIRK By: /s/STEPHEN H. OSBURN
- - ----------------- --------------------
STEPHEN H. OSBURN,
President
/s/SUSAN L. CASAS [Corporate Seal]
- - -----------------
Date of Execution: May 31, 1994
WITNESS: BUYER:
IRT PROPERTY COMPANY,
a Georgia corporation
/s/MARY M. THOMAS By: /s/DONALD W. MACLEOD
- - ----------------- --------------------
DONALD W. MACLEOD,
Chairman and President
/s/LEE A. HARRIS [Corporate Seal]
- - -----------------
Date of Execution: May 31, 1994
<PAGE> 37
BROKER'S ACKNOWLEDGEMENT
ATLANTIC AMERICAN GROUP, INC. ("Broker") hereby consent and
agree to the terms and provisions of Section 16 of the Agreement
of Sale (the "Agreement") by and among IRT PROPERTY COMPANY, a
Georgia corporation, as buyer ("Buyer"), and WESTGATE SQUARE, a
Florida general partnership ("Westgate") and COUNTRYSIDE SHOPS, a
Florida general partnership ("Countryside"), as sellers (Westgate
and Countryside being sometimes hereinafter referred to
collectively as "Sellers"), to which this Broker's
Acknowledgement is attached, and represent and warrant to Seller
and Buyer as follows:
(1) To its best knowledge there are no other brokers
involved in connection with this transaction other than Broker;
(2) Buyer (as defined in the Agreement) shall under no
circumstances have any liability to Broker for any brokerage fees
or commissions in connection with the Agreement or the
transactions contemplated therein;
(3) That Broker shall be entitled to receive a
brokerage commission in the amount of Two Hundred Fifty-Three
Thousand Dollars ($253,000), less such sums previously paid by
Seller to Broker for all work preformed in connection with this
transaction, at the time of and if and only if the purchase of
Property is consummated ("Commission");
(4) The Commission shall only be deemed to have been
earned by Broker if, as and when the Closing occurs and title to
Property actually passes from Sellers to Buyer, and if for any
reason whatsoever the sale of the Property does not take place,
then in any such event Broker shall not have earned, shall not be
deemed to have earned and shall not be entitled to receive any
compensation whatsoever relating to the sale of the Property, and
in any such event, Sellers are hereby released from any and all
claims of every kind and nature whatsoever that Broker may have
against Seller; and
(5) The Commission payable to Broker shall be the only
Commission payable to Broker in connection with the sale and
purchase of the Property under the terms of the Agreement.
IN WITNESS WHEREOF, Brokers have executed this
Acknowledgment as of the date indicated below.
ATLANTIC AMERICAN GROUP, INC.,
a Florida corporation
By: /s/ORME MILLER
----------------------
ORME MILLER, President
[Corporate Seal]
Date: May 31, 1994
<PAGE> 38
INDEX OF EXHIBITS
EXHIBIT "A-1" - Legal Description of the Countryside
Property
EXHIBIT "A-2" - Legal Description of the Westgate
Property
EXHIBIT "B" - Schedules of Contracts
EXHIBIT "C" - Schedules of Leases
EXHIBIT "D" - Schedules of Licenses
EXHIBIT "E" - Lists of Permitted Exceptions
EXHIBIT "F" - Bills of Sale
EXHIBIT "G" - Tax Schedules
EXHIBIT "H" - Special Warranty Deeds
EXHIBIT "I" - Assignments
EXHIBIT "J" - Affidavit of No Liens
EXHIBIT "K" - Litigation Schedules
EXHIBIT "L" - Affidavits of Non-Foreign Citizenship
EXHIBIT "M" - Forms of Estoppel Certificate
EXHIBIT "N" - Escrow Agreements with Escrow Agents
EXHIBIT "O" - Use Restriction Agreements with Shell
Oil Company and Chase Federal Savings
Bank
