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) December
8, 1997
DEAN WITTER REALTY INCOME PARTNERSHIP I, L.P.
(Exact name of registrant as specified in its charter)
Delaware 0-13260 13-3174553
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
Two World Trade Center, New York, New York
10048
(Address of principal executive offices)
(Zip Code)
Registrant's telephone number, including area code(212) 392-1054
(Former name or former address, if changed since last report)
<PAGE>
Item 2. Acquisition or Disposition of Assets
Pursuant to a Purchase and Sale Agreement dated as of
November 10, 1997, as amended, the Partnership agreed
to sell the land and buildings which comprise the
Carmel Park property to Invesco Realty Advisors, Inc.,
an unaffiliated party, for a negotiated sale price of
$17.7 million.
The closing of the sale took place on December 8, 1997.
At closing, the Partnership received proceeds of
approximately $17.2 million, net of closing costs and
other deductions.
Item 7. Financial Statements and Exhibits
(b) Pro Forma Financial Information
(1) Pro Forma Balance Sheet as of July 31,
1997.
(2) Pro Forma Statements of Operations for the year
ended October 31, 1996 and of Income for the
nine months ended July 31, 1997.
(c) Exhibits
(1) Purchase and Sale Agreement, dated as of
November 10, 1997, with respect to the
sale of the Carmel Park property.
(2) First Amendment to Purchase and Sale
Agreement, dated as of December 2,
1997.
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 hereunto
duly authorized.
DEAN WITTER REALTY INCOME PARTNERSHIP
I, L.P.
By: Dean Witter Realty Income Properties
I, Inc.
Managing General Partner
By: /s/E. Davisson Hardman, Jr,
E. Davisson Hardman, Jr.
President
Date: December 23, 1997
<TABLE>
Dean Witter Realty Income Partnership I, L.P.
Pro Forma Consolidated Balance Sheet
As of July 31, 1997
The following unaudited pro forma balance sheet has been
presented as if the Carmel Park property was sold as of July 31,
1997. The pro forma adjustments reflect a) the net cash proceeds
from the sale, b) the elimination of the net carrying value of
the property from real estate and c) the elimination of other
assets and liabilities relating to the property sold.
<CAPTION>
Pro Forma
Historical Adjustments Pro Forma
ASSETS
<S> <C> <C> <C>
Real estate $26,586,924$(10,522,533) $16,064,391
Real estate held for sale 2,982,030 - 2,982,030
Cash and cash equivalents1,699,57617,089,047 18,788,623
Other assets 1,534,020 (545,025) 988,995
$32,802,550 $6,021,489 $38,824,039
LIABILITIES AND PARTNERS' CAPITAL
Accounts payable and other
liabilities $ 986,252 $ (144,916) $ 841,336
Total partners' capital31,816,298 6,166,405 37,982,703
$32,802,550$ 6,021,489 $38,824,039
</TABLE>
<TABLE>
Dean Witter Realty Income Partnership I, L.P.
Pro Forma Consolidated Statement of Operations
For the year ended October 31, 1996
The following unaudited pro forma consolidated statement of
operations has been presented as if the Carmel Park property was
sold as of the beginning of fiscal year 1996. The pro forma
adjustments reflect the elimination of rental and other revenues,
property operating expenses, and depreciation and amortization
expenses relating to the property sold. The pro forma
adjustments do not reflect the Partnership's nonrecurring gain on
the sale of the property.
<CAPTION>
Pro Forma
Historical Adjustments Pro Forma
Revenues:
<S> <C> <C> <C>
Rental $7,013,164 $(2,052,828) $4,960,336
Gain on sale of real estate683,471 - 683,471
Equity in earnings of
joint venture 589,362 - 589,362
Interest and other 207,740 (23,833) 183,907
8,493,737 (2,076,661) 6,417,076
Expenses:
Property operating3,085,939 (874,935) 2,211,004
Interest 218,159 - 218,159
Depreciation 1,745,666 (804,791) 940,875
Amortization 138,008 (37,141) 100,867
General and administrative 403,546 - 403,546
Loss on impairment of
real estate 8,510,000 (2,757,000) 5,753,000
14,101,318 (4,473,867) 9,627,451
Net loss $(5,607,581) $(2,397,206) $(3,210,375)
Net loss per
Unit of Limited
Partnership interest$ (53.66)$ (23.25)$ (30.41)
</TABLE>
<TABLE>
Dean Witter Realty Income Partnership I, L.P.
Pro Forma Consolidated Statement of Income
For the nine months ended July 31, 1997
The following unaudited pro forma consolidated statement of
operations has been presented as if the Carmel Park property was
sold as of the beginning of fiscal year 1996. The pro forma
adjustments reflect the elimination of rental and other revenues,
property operating expenses and depreciation and amortization
expenses relating to the property sold. The pro forma adjustments
do not reflect the Partnership's nonrecurring gain on the sale of
the property.
<CAPTION>
Pro Forma
Historical Adjustments Pro Forma
Revenues:
<S> <C> <C> <C>
Rental $ 4,798,148 $ (1,678,724) $ 3,119,424
Equity in earnings of
joint venture 2,425,949 - 2,425,949
Interest and other 191,176 (4,498) 186,678
7,415,273 (1,683,222) 5,732,051
Expenses:
Property operating2,171,988 (669,896) 1,502,092
Depreciation 940,389 (449,447) 490,942
Amortization 94,172 (23,929) 70,243
General and administrative 352,067 - 352,067
3,558,616 (1,143,272) 2,415,344
Net income $ 3,856,657 $ (539,950) $ 3,316,707
Net income per
Unit of Limited
Partnership interest$ 39.63 $ (5.24)$ 34.39
</TABLE>
Exhibit Index for Dean Witter Realty Income Partnership I, L.P.
Exhibit
No. Description
(10)(a) Purchase and Sale Agreement,
dated as of November 10, 1997
with respect to the sale of
the Carmel Park property.
(10)(b) First Amendment to Purchase and
Sale Agreement dated as of
December 2, 1997.
E-1
-33-
PURCHASE AND SALE AGREEMENT
PURCHASE AND SALE AGREEMENT (this "Agreement"), dated as
of the 10 day of November, 1997, by and between DEAN WITTER
REALTY INCOME PARTNERSHIP I, L.P., a Delaware limited
partnership, having an office c/o Dean Witter Realty Inc.,
Two World Trade Center, 64th Floor, New York, New York 10048,
(the "Seller"), and INVESCO REALTY ADVISORS, INC., a Delaware
corporation, having an office at One Lincoln Center, 5400 LBJ
Freeway, Suite 1200, Dallas, Texas 75240 (the "Purchaser").
W I T N E S S E T H
WHEREAS, the Seller is the owner of the real property
known and numbered as 11111 and 11112 Carmel Commons
Boulevard, Charlotte, North Carolina consisting of 2
buildings commonly referred to as "Carmel Park I" and "Carmel
Park II", respectively;
WHEREAS, the Seller and the Purchaser have entered into
negotiations wherein the Purchaser expressed its intent to
purchase the Property (as defined herein) from the Seller and
the Seller expressed its intent to sell the Property to the
Purchaser; and
WHEREAS, the Seller and the Purchaser now desire to
enter into an agreement whereby, subject to the terms and
conditions contained herein, the Seller shall sell the
Property to the Purchaser and the Purchaser shall purchase
the Property from the Seller.
NOW, THEREFORE, in consideration of ten ($10.00) dollars
and the mutual covenants and agreements hereinafter set
forth, and intending to be legally bound hereby, it is hereby
agreed as follows:
Sale of the Property.
The Seller agrees to sell and convey to the Purchaser, and
the Purchaser agrees to purchase from the Seller, at the
price and upon the terms and conditions set forth in this
Agreement, all those certain plots, pieces and parcels of
land described in Schedule 1 hereto (the "Land") listed
thereon as owned by the Seller, together with (i) all
buildings and other improvements situated on the Land
(collectively, the "Buildings"), (ii) all easements, rights
of way, reservations, privileges, appurtenances, and other
estates and rights of the Seller pertaining to the Land and
the Buildings (including the Seller's interest in the
Leases), (iii) all right, title and interest of the Seller in
and to all fixtures, machinery, equipment, supplies and other
articles of personal property attached or appurtenant to the
Land or the Buildings, or used in connection therewith
(collectively, the "Personal Property"), and (iv) all right,
title and interest of the Seller, if any, in and to the trade
names of the Buildings (the Land, together with all of the
foregoing items listed in clauses (i)-(iv) above being
hereinafter sometimes referred to as the "Property").
Excluded Property.
Specifically excluded from the Property and this
sale are all items of personal property of tenants under
the Leases and the items described in Schedule 2 annexed
hereto and made a part hereof.
Closing Date.
The delivery of the Deed and the consummation of
the transactions contemplated by this Agreement (the
"Closing") shall take place at the offices of the Title
Company at 6135 Park South Drive, Suite 225, Charlotte,
North Carolina 28210, at 10:00 A.M. on the date which is
on or before seven (7) days after the end of the Due
Diligence Period unless such day is not a day on which
the Recorder's Office of Mecklenburg County, North
Carolina is open for business, in which case, the
Closing shall take place on the next day on which such
Recorder's Office is open (the "Closing Date") or such
earlier or later date as the Seller and the Purchaser
may agree in writing.
Purchase Price.
The purchase price to be paid by the Purchaser to the
Seller for the Property (the "Purchase Price") is Seventeen
Million Seven Hundred Fifty Thousand Dollars ($17,750,000)
payable as follows:
(a) (i) Twenty-Five Thousand Dollars ($25,000)
("Downpayment A"), (ii) Twenty-Five Thousand Dollars
($25,000) ("Downpayment B"), and (iii) Three Hundred
Fifty Thousand Dollars ($350,000) ("Downpayment C")
(Downpayment A, Downpayment B and Downpayment C being
sometimes hereinafter collectively referred to as the
"Downpayment") shall be payable within twenty-four (24)
hours of the execution and delivery of this Agreement,
by delivery to First American Title Insurance Company
(the "Escrow Agent") of a certified or bank check drawn
on or by a bank which is a member of the New York
Clearing House Association (a "Clearing House Bank") or
by wire transfer of immediately available funds to the
Escrow Agent's account as set forth in the Escrow
Agreement. The Downpayment shall be held and disbursed
by the Escrow Agent in accordance with the terms of
Section 15. At the Closing, the Deposit shall be
delivered to the Seller and such amount shall be
credited against the portion of the Purchase Price
payable pursuant to Section 2(b);
(b) The balance of the Purchase Price (i.e., the
Purchase Price minus the credit set forth in Section
2(a) above), plus or minus the apportionments set forth
in Section 3, shall be paid at the Closing by bank wire
transfer of immediately available funds to the Seller's
account or to the account or accounts of such other
party or parties as may be designated by the Seller on
or before the Closing Date.
Apportionments
The following shall be apportioned between the Seller
and the Purchaser at the Closing as of 11:59 p.m. of the day
preceding the Closing Date (the "Adjustment Date"):
(a) fixed or base rents ("Rents") which have been
prepaid, security deposits referred to in Section 8(e),
Rents for the month in which the Closing occurs and
Additional Rents and other amounts paid by tenants
applicable to periods which expire after the Closing
Date, which have been received by Seller;
(b) real estate taxes, special assessments, water
charges, sewer rents and charges and vault charges, if
any, on the basis of the fiscal years (or applicable
billing period if other than a fiscal year),
respectively, for which same have been assessed;
(c) charges and payments under Contracts that are
being assigned to the Purchaser pursuant to the terms of
this Agreement and listed on Schedule 3 hereto or
permitted renewals or replacements thereof;
(d) any prepaid items, including, without
limitation, fees for licenses which are transferred to
the Purchaser at the Closing and annual permit and
inspection fees;
(e) utilities, to the extent required by Section
3.4;
(f) deposits with telephone and other utility
companies, and any other persons or entities who supply
goods or services in connection with the Property if
same are assigned to the Purchaser at the Closing;
(g) personal property taxes, if any, on the basis
of the fiscal year for which assessed;
(h) all other revenues from the operation of the
Property other than Rents and Additional Rents
(including, without limitation, parking charges, tenant
direct electrical reimbursements, HVAC overtime charges,
and telephone booth and vending machine revenues);
(i) New Lease Expenses as provided in Section
10.1.2; and
(j) such other items as are customarily
apportioned between sellers and purchasers of real
properties of a type similar to the Property and located
in Mecklenburg County, North Carolina.
Taxes.
If the amount of real estate taxes, special
assessments or other taxes for the Property for the
fiscal year during which Closing occurs is not finally
determined at the Adjustment Date, such taxes shall be
apportioned on the basis of the full amount of the
assessment for such period (or the assessment for the
prior tax period if the assessment for the current tax
period is not then known) and the rate for the
immediately prior tax year, and shall be reapportioned
as soon as the new tax rate and valuation, if any, has
been finally determined. If any taxes which have been
apportioned shall subsequently be reduced by abatement,
the amount of such abatement, less the cost of obtaining
the same and after deduction of sums payable to tenants
under Leases or expired or terminated Leases, shall be
equitably apportioned between the parties hereto.
Rents.
Arrearages.
If on the Closing Date any tenant is in
arrears in the payment of Rent or has not paid the
Rent payable by it for the month in which the
Closing occurs (whether or not it is in arrears for
such month on the Closing Date), any Rents received
by the Purchaser or the Seller from such tenant
after the Closing shall be applied to amounts due
and payable by such tenant during the following
periods in the following order of priority:
(i) first, to the month in which the Closing
occurred, (ii) second, to the month preceding the
month in which the Closing occurred, and
(iii) third, to the months following the month in
which the Closing occurred. If Rents or any
portion thereof received by the Seller or the
Purchaser after the Closing are due and payable to
the other party by reason of this allocation, the
appropriate sum, less a proportionate share of any
reasonable attorneys' fees and costs and expenses
expended in connection with the collection thereof,
shall be promptly paid to the other party (to the
extent not collected from or reimbursed by
tenants).
Additional Rents.
If any tenants are required to pay percentage
rent, escalation charges for real estate taxes,
parking charges, operating expenses and maintenance
escalation charges, cost-of-living increases or
other charges of a similar nature ("Additional
Rents") and any Additional Rents are collected by
the Purchaser from a tenant after the Closing Date,
then the Purchaser shall promptly pay to the Seller
out of the first such sums received from such
tenant the amount of all Additional Rents which are
due and payable by such tenant with respect to any
period prior to the Closing Date (whether or not
such Additional Rents first became due and payable
on or after the Closing Date), less a proportionate
share of any reasonable attorneys' fees and costs
and expenses of collection thereof (to the extent
not collected from or reimbursed by tenants).
Collection After the Closing.
After the Closing, the Seller shall continue
to have the right, in its own name, to demand
payment of and to collect Rent and Additional Rent
arrearages owed to the Seller by any tenant, which
right shall include, without limitation, the right
to continue or commence legal actions or
proceedings against any tenant. The Purchaser
agrees to cooperate with the Seller in connection
with all efforts by the Seller to collect such
Rents and Additional Rents and to take all steps,
whether before or after the Closing Date, as may be
reasonably necessary to carry out the intention of
the foregoing, including, without limitation, the
delivery to the Seller, upon demand, of any
relevant books and records (including any Rent or
Additional Rent statements, receipted bills and
copies of tenant checks used in payment of such
Rent or Additional Rent), the execution of any and
all consents or other documents, and the
undertaking of any act reasonably necessary for the
collection of such Rents and Additional Rents by
the Seller. The Seller agrees that after the
Closing it shall not commence (nor request that the
Purchaser commence or continue) any legal or
equitable proceedings against any tenant on the
Property in the nature of an unlawful detainer or
eviction, or any other proceedings to terminate the
lease, evict the tenant or otherwise disturb a
tenant in its possession of the Property. If for
any fiscal period which includes the Adjustment
Date tenants are paying Additional Rent based upon
estimates prepared by the Seller, such Additional
Rents shall be reapportioned when the actual
expenses for the fiscal period are known.
Utilities.
The Seller will attempt to obtain final cut-off
readings of water, fuel, telephone, electricity, and gas
to be made as of the Adjustment Date. The Seller shall
pay the bills based on such readings promptly after the
same are rendered. If arrangements cannot be made for
any such cut-off reading, the parties shall apportion
the charges for such services on the basis of the bill
therefor for the most recent billing period prior to the
Adjustment Date, and when final bills are rendered for
the period which includes the Adjustment Date the Seller
and Purchaser shall promptly readjust the apportionments
in accordance with such final bills.
Post-Closing Adjustments.
The items set forth in this Section 3 shall be
apportioned at the Closing by payment of the net amount
of such apportionments to the Seller in the manner set
forth herein for the payment of the Purchase Price if
the net apportionment is in favor of the Seller or by a
credit against the Purchase Price if the net
apportionment is in favor of the Purchaser. However, if
any of the items subject to apportionment under the
foregoing provisions of this Section 3 cannot be
apportioned at the Closing because of the unavailability
of the information necessary to compute such
apportionment, or if any errors or omissions in
computing apportionments at the Closing are discovered
subsequent to the Closing, then such item shall be
reapportioned and such errors and omissions corrected as
soon as practicable after the Closing Date and the
proper party reimbursed, which obligation shall survive
the Closing for a period of one year after the Closing
Date.
Due Diligence Period.
The Purchaser shall have (i) a eight (8) day period to
examine the items listed on Schedule 12A, (ii) a fourteen
(14) day period to examine the items listed on Schedule 12B,
and (iii) a twenty-one (21) day period to examine the items
listed on Schedule 12C (the period required to complete all
the examinations described in subsections 4(i), (ii) and
(iii) being hereinafter referred to as the "Due Diligence
Period"). Notwithstanding the previous sentence, the Due
Diligence Period shall not extend beyond December 1, 1997.
The Seller shall use reasonable efforts to provide to the
Purchaser the items listed on Schedules 12A, 12B and 12C.
The respective review period for each of the items listed on
Schedules 12A, 12B and 12C shall commence upon the date that
such item is delivered to or made available for review by the
Purchaser whether or not such date is prior to the date of
this Agreement. If the Purchaser has not objected, in
accordance with the terms set forth in Section 4.2, to an
item of Property Information within the relevant review
period set forth above, such item of Property Information
shall be deemed accepted and the Purchaser shall no longer
have the right to object to such item or terminate this
Agreement because of such item.
In addition, the Purchaser shall have until November 17,
1997 to conduct third-party Investigations on the Property
and until December 1, 1997 to conduct its own Investigations
on the Property.
Access to the Property.
During the Due Diligence Period (and prior to the
Due Diligence Period in accordance with that certain
letter agreement executed by the Purchaser on November
4, 1997 (the "Letter Agreement")), the Purchaser and the
Purchaser's Representatives shall have the right to
enter upon the Property for the sole purpose of
inspecting the Property and shall be entitled to make or
conduct surveys, soil borings, engineering tests,
environmental assessments, and other investigations,
inspections and tests of any kind (collectively,
"Investigations"), provided (i) the Purchaser shall give
the Seller not less than one (1) business day's prior
written notice before each entry, unless waived by the
Seller, (ii) the first such notice shall include
sufficient information to permit the Seller to review
the scope of the proposed Investigations, unless waived
by the Seller, and (iii) neither the Purchaser nor the
Purchaser's Representatives shall permit any borings,
drillings or samplings to be done on the Property
without the Seller's prior written consent. Any entry
upon the Property and all Investigations on the Property
shall be during the Seller's normal business hours and
at the sole risk and expense of the Purchaser and the
Purchaser's Representatives, and shall not interfere
with the activities on or about the Property of the
Seller, its tenants and their employees and invitees.
The Purchaser shall:
(a) promptly repair any damage to the
Property resulting from any such Investigations and
replace, refill and regrade any holes made in, or
excavations of, any portion of the Property used
for such Investigations so that the Property shall
be in the same condition as that which existed
prior to such Investigations;
(b) fully comply with all Laws applicable to
the Investigations and all other activities
undertaken in connection therewith;
(c) permit the Seller to have a
representative present during all Investigations
undertaken hereunder;
(d) take all actions and implement all
protections necessary to ensure that all actions
taken in connection with the Investigations, and
the equipment, materials, and substances generated,
used or brought onto the Property pose no threat to
the safety or health of persons or the environment,
and cause no damage to the Property or other
property of the Seller or other persons;
(e) If the Purchaser is relying on the
results of an Investigation to terminate this
Agreement, then the Purchaser shall promptly
furnish to the Seller, at no cost or expense to the
Seller, copies of the study or report relating to
such Investigation.
(f) maintain or cause to be maintained, at
the Purchaser's expense, a policy of comprehensive
general public liability insurance with a combined
single limit of not less than $1,000,000 per
occurrence for bodily injury and property damage,
automobile liability coverage including owned and
hired vehicles with a combined single limit of
$1,000,000 per occurrence for bodily injury and
property damage, and an excess umbrella liability
policy for bodily injury and property damage in the
minimum amount of $3,000,000, insuring the
Purchaser and the Seller and certain of Seller's
Affiliates listed on Schedule 4, as additional
insureds, against any injuries or damages to
persons or property that may result from or are
related to (i) the Purchaser's and/or the
Purchaser's Representatives' entry upon the
Property, (ii) any Investigations or other
activities conducted thereon, and (iii) any and all
other activities undertaken by the Purchaser and/or
the Purchaser's Representatives in connection with
the Property, and deliver evidence of such
insurance policy to the Seller at the earlier of
ten (10) days after the date of this Agreement or
the first entry on the Property;
(g) indemnify the Seller and the Seller's
Affiliates and hold the Seller and the Seller's
Affiliates harmless from and against any and all
claims, demands, causes of action, losses, damages,
liabilities, costs and expenses (including without
limitation attorneys' fees and disbursements),
suffered or incurred by the Seller or any of the
Seller's Affiliates and arising out of or in
connection with (i) the Purchaser and/or the
Purchaser's Representatives' entry upon the
Property, (ii) any Investigations or other
activities conducted thereon by the Purchaser or
the Purchaser's Representatives, and (iii) any
liens or encumbrances filed or recorded against the
Property as a consequence of the Investigations;
and
(h) not, at any time, contact or communicate
with any tenant of the Property for any reason
whatsoever without the prior written approval of
the Seller, which communications, whether by
telephone, in writing or in person, Seller or its
designee shall have the right to be present at or
otherwise participate in.
The provisions of this Section 4.1 shall survive
the termination of this Agreement and the Closing.
The provisions of this Section 4.1 shall supersede
the Letter Agreement, and any liability incurred by the
Purchaser pursuant to the Letter Agreement shall be
deemed to have arisen under this Agreement.
Purchaser's Termination Notice.
Subject to the Cure Right (as hereinafter defined),
the Purchaser shall have the right to elect to terminate
this Agreement by giving written notice (the
"Purchaser's Termination Notice") of such election to
the Seller at any time prior to the expiration of the
respective review period for each of the items listed on
Schedules 12A, 12B and 12C or until November 17, 1997
for the third party Investigations or until December 1,
1977 for the Purchaser's own Investigations, if the
Purchaser shall determine (in the exercise of its
reasonable discretion) that any of the following
conditions to termination are met as of the date of the
Purchaser's Termination Notice, in which event the
provisions of Section 14.1 shall apply subject to the
Cure Right:
(a) The Purchaser shall have determined,
based upon a site assessment study conducted at the
Purchaser's sole expense by any qualified
engineering firm proposed by the Purchaser and
approved by the Seller that there is oil, hazardous
substances, hazardous materials, hazardous or toxic
waste, or friable and accessible asbestos-
containing materials present on the Property in an
amount which would require remediation under
Applicable Environmental Law.
(b) The Purchaser shall have determined,
based upon a final engineering study covering the
Buildings and any other existing structures on the
Property, that there are material defects in any
roof, foundation, sprinkler mains, structural
elements and masonry walls of any of the Buildings
or related heating, ventilating and air-
conditioning, electrical, sanitation, water, or
mechanical systems that are not disclosed in that
certain Existing Building Inspection Report for the
Property prepared by DSAtlantic Corporation dated
July 8, 1995 (sic) (the "DSAtlantic Report"), the
Purchaser hereby acknowledging and agreeing that
the Purchaser shall have no right of any kind or
for any reason whatsoever to terminate this
Agreement due to any defect or any other condition
disclosed or identified in the DSAtlantic Report.
(c) The Purchaser shall have determined,
based upon a legal opinion from its special
counsel, that the Buildings as presently
constructed and used violate in a material respect
applicable federal or state law or governmental
regulation, or local ordinance, order or
regulation, including but not limited to laws,
regulations or ordinances relating to land use,
zoning, building use and occupancy, subdivision
control, fire protection, public health and safety,
wetlands protection and protection of the
environment.
(d) The Purchaser shall have determined that
the Leases, the income and expenses and property
tax bills for the Property do not conform in all
material respects to the information contained in
the Investment Offering Memorandum, prepared by the
Broker.
(e) The Purchaser shall have determined that
the Contracts are not in form and substance
reasonably acceptable to the Purchaser. If any
Contracts are not reasonably acceptable to the
Purchaser, the Purchaser shall notify the Seller
which Contracts are not acceptable to the Purchaser
and the reasons therefor. Any so identified
Contracts which Seller agrees to terminate or
accept financial responsibility for on the Closing
Date shall not give rise to a right of termination
by Purchaser hereunder.
(f) The Purchaser shall have determined that
the items listed on Schedules 12A, 12B and 12C or
the Investigations reveal a condition of the
Property which is not reasonably acceptable to the
Purchaser because such condition would have a
material adverse effect on the value of the
Property as currently used.
If for any reason whatsoever the Seller shall not
have received the Purchaser's Termination Notice prior
to the expiration of the respective review period for
each of the items listed on Schedules 12A, 12B and 12C
or by November 17, 1997 for the third party
Investigations or until December 1, 1997 for the
Purchaser's own Investigations, the Purchaser shall be
deemed to have irrevocably waived the right of
termination granted under this Section 4.2, and such
right of termination shall be of no further force or
effect.
Purchaser's Termination Notice shall state with
sufficient particularity the conditions precedent to the
Purchaser's obligation to purchase the Property which
have not been satisfied and the Seller shall have the
option, exercisable by giving written notice of such
exercise to the Purchaser within seven (7) days of the
Seller's receipt of the Purchaser's Termination Notice,
to elect to use reasonable efforts and to expend
reasonable sums to cause the satisfaction within sixty
(60) days of such unsatisfied conditions precedent
specified in Purchaser's Termination Notice (the "Cure
Right"), in which event this Agreement shall not
terminate as a result of the Purchaser's delivery of the
Purchaser's Termination Notice.
Notwithstanding the foregoing, the Purchaser shall
have the right, subject to the Cure Right, to terminate
this Agreement for a reason other than those set forth
in sections 4.2 (a)-(f) by sending a Purchaser's
Termination Notice to the Seller stating with
particularity the conditions precedent to the
Purchaser's obligation to purchase the Property which
have not been satisfied.
In the event that the Purchaser delivers notice to
the Seller prior to the expiration of the tenth day
after the date hereof of its intent to terminate this
Agreement for a reason other than those set forth in
Sections 4.2(a)-(f) and/or other than in accordance with
this Section 4.2, then, subject to the Cure Right: (i)
the Purchaser shall be entitled to a return of
Downpayment B and Downpayment C and (ii) the Seller
shall be entitled to retain Downpayment A as liquidated
damages in accordance with the provisions of Section
14.2.
In the event that the Purchaser delivers notice to
the Seller after the expiration of the tenth day after
the date hereof but prior to the end of the Due
Diligence Period of its intent to terminate this
Agreement for a reason other than those set forth in
Sections 4.2(a)-(f) and/or other than in accordance with
this Section 4.2, then, subject to the Cure Right: (i)
the Purchaser shall be entitled to a return of
Downpayment C and (ii) the Seller shall be entitled to
retain Downpayment A and Downpayment B as liquidated
damages in accordance with the provisions of Section
14.2.
If the Seller elects to exercise the Cure Right in
response to any Purchaser's Termination Notice, whether
or not it is for a reason stated in Section 4.2 (a)-(f),
and the Purchaser delivers written notice to the Seller
that it disputes (i) the scope or manner of cure, or
(ii) whether a purported cure by the Seller is
satisfactory, then pending resolution of the dispute
through agreement of the parties, litigation or other
means, the Purchaser shall be entitled to a return of a
portion of its Downpayment as follows: (X) if the
Purchaser disputes the Seller's cure within ten (10)
days after receiving notice of the Seller's intent to
cure, then the Purchaser shall be entitled to a return
of Downpayment C and Downpayment B, or (Y) thereafter,
the Purchaser shall be entitled to a return of
Downpayment C only. If the dispute is resolved in favor
of the Purchaser, the portion of the Downpayment
retained pursuant to clause (X) or (Y) shall be returned
to the Purchaser; otherwise it shall be distributed to
the Seller.
Estoppel Certificates.
Promptly after execution and delivery of this
Agreement, the Seller agrees to request an Estoppel
Certificate from each tenant under a Lease, and it shall
be a condition precedent to the Purchaser's obligation
to close this transaction that the Seller shall have
obtained executed Estoppel Certificates from (i) Royal
Indemnity Company and Insurance Company of North America
and (ii) one-half of all other tenants in the Buildings.
The Estoppel Certificates shall be in the form annexed
hereto as Exhibit G and made a part hereof; provided,
however, if any tenant is required or permitted under
its Lease to make different statements in a certificate
of such nature than are set forth in Exhibit G, prior to
requesting an Estoppel Certificate from such tenant, the
Seller may modify the Estoppel Certificate for such
tenant to set forth only the statements required under
such tenant's Lease to be made by such tenant in such a
certificate.
Title.
The Seller has delivered to the Purchaser, at the
Purchaser's expense, a commitment for an owner's fee title
insurance policy with respect to the Property (the "Title
Commitment") from First American Title Insurance Company (the
"Title Company"), together with true and complete copies of
all instruments giving rise to any defects or exceptions to
title to the Property. The Seller has delivered to the
Purchaser, at the Purchaser's expense, an as-built survey
("Survey") of the Land and Building dated August 26, 1997 and
prepared by Carolina Surveyors, Inc. in accordance with the
"Minimum Standard Detail Requirements for ALTA/ACSM Land
Title Surveys" jointly established and adopted by ALTA and
ACSM in 1992.
Unacceptable Encumbrances.
If the Title Commitment or the Survey indicate the
existence of any liens or encumbrances (collectively,
"Liens") or other defects or exceptions in or to title
to the Property (collectively, the "Unacceptable
Encumbrances") subject to which the Purchaser is
unwilling to accept title and the Purchaser gives the
Seller notice of the same within eight (8) days after
receipt of the Title Commitment or the Survey,
respectively, the Seller shall undertake to eliminate
the same (or to arrange for title insurance insuring
against enforcement of such Unacceptable Encumbrances
against, or collection of the same out of, the Property)
subject to Section 5.2. The Purchaser hereby waives any
right the Purchaser may have to advance as objections to
title or as grounds for the Purchaser's refusal to close
this transaction any Unacceptable Encumbrance which the
Purchaser does not notify the Seller of within such
eight (8) day period unless (i) such Unacceptable
Encumbrance was first raised by the Title Company
subsequent to the date of the Title Commitment or the
Purchaser shall otherwise first discover same or be
advised of same subsequent to the date of the Title
Commitment or the Survey, respectively, and (ii) the
Purchaser shall notify the Seller of the same within
five (5) days after the Purchaser first becomes aware of
such Unacceptable Encumbrance. The Seller, in its sole
discretion, may adjourn the Closing one or more times
for up to sixty (60) days in the aggregate in order to
eliminate Unacceptable Encumbrances.
Removal of Unacceptable Encumbrances.
The Seller shall not be obligated to bring any
action or proceeding, to make any payments or otherwise
to incur any expense in order to eliminate Unacceptable
Encumbrances not waived by the Purchaser or to arrange
for title insurance insuring against enforcement of such
Unacceptable Encumbrances against, or collection of the
same out of, the Property; except that the Seller shall
satisfy Unacceptable Encumbrances which are (i)
mortgages and past due real estate taxes and assessments
secured by or affecting the Property, and (ii) judgments
against the Seller or other Liens secured by or
affecting the Property which judgments and other Liens
can be satisfied by payment of liquidated amounts not to
exceed $50,000 in the aggregate for all such judgments
and other Liens. The Seller may eliminate any such
Unacceptable Encumbrance by the payment of amounts
necessary to cause the removal thereof of record, by
bonding over such Unacceptable Encumbrance in a manner
reasonably satisfactory to the Purchaser or by arranging
for title insurance reasonably satisfactory to the
Purchaser insuring against enforcement of such
Unacceptable Encumbrance against, or collection of the
same out of, the Property.
Options Upon Failure to Remove Unacceptable
Liens.
If the Seller is unable or is not otherwise
obligated (pursuant to Section 5.2) to eliminate all
Unacceptable Encumbrances not waived by the Purchaser,
or to bond over in a manner reasonably satisfactory to
the Purchaser any Unacceptable Encumbrances not waived
by the Purchaser, or to arrange for title insurance
reasonably acceptable to the Purchaser insuring against
enforcement of such Unacceptable Encumbrances against,
or collection of the same out of, the Property, and to
convey title in accordance with the terms of this
Agreement on or before the Closing Date (whether or not
the Closing is adjourned as provided in Section 5.1),
the Purchaser shall elect on the Closing Date, as its
sole remedy for such inability of the Seller, either (i)
to terminate this Agreement by notice given to the
Seller pursuant to Section 14.1, in which event the
provisions of Section 14.1 shall apply, or (ii) to
accept title subject to such Unacceptable Encumbrances
and receive no credit against, or reduction of, the
Purchase Price.
Use of Purchase Price.
If on the Closing Date there may be any Liens or
other encumbrances which the Seller must pay or
discharge in order to convey to the Purchaser such title
as is herein provided to be conveyed, the Seller may use
any portion of the Purchase Price to satisfy the same,
provided:
(a) the Seller shall deliver to the Purchaser
or the Title Company, at the Closing, instruments
in recordable form and sufficient to satisfy such
Liens or other encumbrances of record together with
the cost of recording or filing said instruments;
or
(b) the Seller, having made arrangements with
the Title Company, shall deposit with said company
sufficient moneys acceptable to said company to
insure the obtaining and the recording of such
satisfactions.
Franchise Taxes.
Any franchise or corporate tax open, levied or
imposed against the Seller or other owners in the chain
of title that may be a Lien on the Closing Date shall
not be an objection to title if the Title Company omits
same from the title policy issued pursuant to the Title
Commitment or excepts same but insures the Purchaser
against collection thereof out of the Property.
Transfer Taxes; Title Insurance Premiums.
At the Closing, the Seller shall pay all transfer
and recording taxes (the "Transfer Tax Payments")
imposed pursuant to the Laws of the State of North
Carolina or any other governmental authority in respect
of the transactions contemplated by this Agreement by
delivery to the Title Company of sufficient funds to pay
such taxes together with any return (the "Transfer Tax
Return") required thereby which shall be duly executed
by the Seller and the Purchaser to the extent required
by applicable law. At the Closing, the premiums due the
Title Company to obtain title insurance policies in the
form contemplated by the Title Commitment (as the same
may be amended pursuant to this Agreement), the cost of
obtaining the survey and other Closing-related expenses
shall be paid in the manner set forth on Schedule 6
hereto.
Representations and Warranties of the Seller.
For the purposes of this Section 6, references made to
the actual knowledge of the Seller shall be limited to the
actual knowledge of James M. Thomson after having made
reasonable inquiry of the property manager.
The Seller represents and warrants to the Purchaser as
follows:
(a) The Seller is a duly formed and validly
existing limited partnership organized under the laws of
the State of Delaware and is qualified under the laws of
the State of North Carolina to conduct business therein.
(b) The Seller has the full, legal right, power
and authority to execute and deliver this Agreement and
all documents now or hereafter to be executed by the
Seller pursuant to this Agreement (collectively, the
"Seller's Documents"), to consummate the transaction
contemplated hereby, and to perform its obligations
hereunder and under the Seller's Documents.
(c) This Agreement and the Seller's Documents do
not and will not contravene any provision of the limited
partnership agreement of the Seller, any judgment,
order, decree, writ or injunction issued against the
Seller, or, to the Seller's actual knowledge, any
provision of any laws or governmental ordinances, rules,
regulations, orders or requirements (collectively, the
"Laws") applicable to the Seller. The consummation of
the transactions contemplated hereby will not result in
a breach or constitute a default or event of default by
the Seller under any agreement to which the Seller or
any of its assets are subject or bound and will not
result in a violation of any Laws applicable to the
Seller.
(d) There are no written or unwritten leases,
licenses or other occupancy agreements affecting any
portion of the Property (collectively, the "Leases") on
the date hereof, except for the Leases listed in
Schedule 7 annexed hereto and made a part hereof. The
copies of the Leases furnished by the Seller to the
Purchaser are, in all material respects, true and
complete. To the Seller's actual knowledge, the Leases
are in full force and effect. There is no material
default by the Seller under any of the Leases. The
Seller has not given or received any notice of default
which remains uncured or unsatisfied, with respect to
any of the Leases.
(e) To the Seller's actual knowledge, there are no
pending actions, suits, proceedings or investigations to
which the Seller is a party before any court or other
governmental authority with respect to the Property
owned by the Seller except as set forth on Schedule 8
hereto.
(f) Except as disclosed on Schedule 9 hereto,
since the date the Seller acquired legal and beneficial
title to the Property (i) neither Seller nor, to the
actual knowledge of the Seller, any third party has
engaged in the generation, use, manufacture, treatment,
storage or disposal of any Hazardous Substance (as
hereinafter defined) on the Property in violation of
Applicable Environmental Law (as hereinafter defined),
the cost of correction or remediation of which would
have a material adverse effect upon the value of the
Property, and (ii) neither Seller nor, to the actual
knowledge of the Seller, any third party has received
any written notice from any governmental authority
having jurisdiction over the Property of any violation
of Applicable Environmental Law with respect to the
Property which requires corrective action, the cost of
which would have a material adverse effect upon the
value of the Property. Disclosure of any matter on
Schedule 9 hereto shall not constitute an admission by
Seller that such matter was material or a violation of
Applicable Environmental Law. As used in this
Agreement, the term "Hazardous Substance" shall mean any
substance, chemical or waste that is currently listed as
hazardous, toxic or dangerous under Applicable
Environmental Law. As used in this Agreement, the term
"Applicable Environmental Law" shall mean the
Comprehensive Environmental Response, Compensation and
Liability Act ("CERCLA"), 42 U.S.C. 9601 et seq.; the
Resource Conservation and Recovery Act ("RCRA"), 42
U.S.C. 6901, et seq.; the Water Pollution Control
Act, 33 U.S.C. 1251 et seq.; the Clean Air Act, 42
U.S.C. 7401 et seq.; and the Toxic Substances Control
Act, 15 U.S.C. 2601 et seq.; as the foregoing have
been amended from time to time to the date of this
Agreement; and any similar state and local laws and
ordinances and the regulations implementing such
statutes in effect on the date hereof imposing liability
or establishing standards of conduct for environmental
protection.
(g) The financial statements listed on Schedule
12B to be provided by the Seller are true and correct in
all material respects.
(h) To the extent Property Information was
prepared by the Seller, it is true and correct in all
material respects.
Survival of Representations.
The representations and warranties of the Seller
set forth in this Section 6 (i) shall be true, accurate
and correct in all material respects upon the execution
of this Agreement and shall be deemed to be repeated on
and as of the Closing Date (except as they relate only
to an earlier date), and (ii) shall remain operative and
shall survive the Closing and the execution and delivery
of the Deed for a period of one year following the
Closing Date and then shall expire, and no action or
claim based thereon shall be commenced after such
period.
Discovery of Untrue Representation.
If at or prior to the Closing, (i) the Purchaser
shall become aware that any of the representations or
warranties made herein by the Seller is untrue,
inaccurate or incorrect in any material respect and
shall give the Seller notice thereof at or prior to the
Closing, or (ii) the Seller shall notify the Purchaser
that a representation or warranty made herein by the
Seller is untrue, inaccurate or incorrect, then the
Seller may, in its sole discretion, elect by notice to
the Purchaser to adjourn the Closing one or more times
for up to sixty (60) days in the aggregate in order to
cure or correct such untrue, inaccurate or incorrect
representation or warranty and the Seller shall provide
reasonable additional time (not to exceed five (5)
business days), if requested by the Purchaser, for the
Purchaser to update estoppel certificates and other
Investigations. (The Purchaser shall be entitled to
terminate this Agreement if any such updated certificate
or Investigation shall show a material adverse change
from the original.) If any such representation or
warranty is not cured or corrected by the Seller on or
before the Closing Date (whether or not the Closing is
adjourned as provided above), then the Purchaser, as its
sole remedy for such inability of Seller, shall elect
either (i) to waive such misrepresentations or breaches
of warranties and consummate the transactions
contemplated hereby without any reduction of or credit
against the Purchase Price, or (ii) to terminate this
Agreement by notice given to Seller pursuant to the
provisions of Section 14.1. In the event the Closing
occurs, the Purchaser hereby expressly waives,
relinquishes and releases any right or remedy available
to it at law, in equity or under this Agreement to make
a claim against the Seller for damages that the
Purchaser may incur, or to rescind this Agreement and
the transactions contemplated hereby, as the result of
any of the Seller's representations or warranties being
untrue, inaccurate or incorrect if the Purchaser knew or
should have known that such representation or warranty
was untrue, inaccurate or incorrect at the time of the
Closing and the Purchaser nevertheless closes title
hereunder.
Limited Nature of Representations.
The Purchaser acknowledges that neither the Seller
nor any of the Seller's Affiliates, nor any of their
agents or representatives, nor Broker has made any
representations or held out any inducements to the
Purchaser other than those specifically set forth in
this Section 6 and Section 11. The Purchaser
acknowledges that the Seller, pursuant to the terms of
this Agreement, has afforded the Purchaser the
opportunity for full and complete investigations,
examinations and inspections of the Property and all
Property Information. The Purchaser acknowledges and
agrees that (i) the Property Information delivered or
made available to the Purchaser and the Purchaser's
Representatives by the Seller or the Seller's
Affiliates, or any of their agents or representatives
may have been prepared by third parties and may not be
the work product of the Seller and/or any of the
Seller's Affiliates; (ii) neither the Seller nor any of
the Seller's Affiliates has made any independent
investigation or verification of, or has any knowledge
of, the accuracy or completeness of, the Property
Information prepared by parties other than the Seller;
(iii) the Purchaser has fully reviewed and accepted, and
is familiar and satisfied with, the DSAtlantic Report
and all information contained and/or disclosed therein
except that Purchaser shall not be deemed to have
approved any information contained and/or disclosed
therein which is not noted as being a material problem
with the Property and which Purchaser's engineer or
other consultant, upon inspection of the Property,
discloses to Purchaser as being a material problem with
the Property; (iv) except as expressly set forth in this
Section 6, the Purchaser is relying solely on its own
investigations, examinations and inspections of the
Property and those of the Purchaser's Representatives
and is not relying in any way on the Property
Information furnished by the Seller or any of the
Seller's Affiliates, or any of their agents or
representatives; and (v) except as expressly set forth
in this Section 6, the Seller disclaims any
representations or warranties with respect to the
accuracy or completeness of the Property Information,
and the Purchaser releases the Seller and the Seller's
Affiliates, and their agents and representatives, from
any and all liability with respect thereto. The
Purchaser or anyone claiming by, through or under the
Purchaser, hereby fully and irrevocably releases the
Seller and the Seller's Affiliates from any and all
claims that it may now have or hereafter acquire against
any of the Seller or the Seller's Affiliates for any
cost, loss, liability, damage, expense, action or cause
of action, whether foreseen or unforeseen, arising from
or related to the presence of environmentally hazardous,
toxic or dangerous substances, or any other conditions
(whether patent, latent or otherwise) affecting the
Property, except for claims against the Seller based
upon any warranty, representation, obligation, or
liability of the Seller expressly provided in this
Agreement, the Seller's gross negligence or willful
misconduct, and indemnity or contribution claims under
CERCLA.
The acceptance of the Deed by the Purchaser shall be
deemed to be full performance and discharge of every
agreement and obligation on the part of the Seller to be
performed pursuant to the provisions of this Agreement,
except for those representations and warranties set forth in
Section 11 hereof which shall survive the Closing, and except
for those representations and warranties set forth in this
Section 6 which shall survive the Closing for a period of
twelve (12) months.
Representations and Warranties of the Purchaser.
The Purchaser represents and warrants to the Seller as
follows:
(a) The Purchaser is a duly formed and validly
existing corporation organized under the laws of the
State of Delaware, and is qualified under the laws of
the State of North Carolina to conduct business therein
on the date hereof.
(b) The Purchaser has the full, legal right,
power, authority and financial ability to execute and
deliver this Agreement and all documents now or
hereafter to be executed by it pursuant to this
Agreement (collectively, the "Purchaser's Documents"),
to consummate the transactions contemplated hereby, and
to perform its obligations hereunder and under the
Purchaser's Documents.
(c) To the Purchaser's actual knowledge this
Agreement and the Purchaser's Documents do not and will
not contravene any provision of the Articles of
Incorporation or By-Laws of the Purchaser, any judgment,
order, decree, writ or injunction issued against the
Purchaser, or any provision of any Laws applicable to
the Purchaser. To the Purchaser's actual knowledge the
consummation of the transactions contemplated hereby
will not result in a breach or constitute a default or
event of default by the Purchaser under any agreement to
which the Purchaser or any of its assets are subject or
bound and will not result in a violation of any Laws
applicable to the Purchaser.
(d) To the Purchaser's actual knowledge there are
no pending actions, suits, proceedings or investigations
to which the Purchaser is a party before any court or
other governmental authority which may have an adverse
impact on the transactions contemplated hereby.
The representations and warranties of the Purchaser set
forth in this Section 7 and elsewhere in this Agreement shall
be true, accurate and correct in all material respects upon
the execution of this Agreement, shall be deemed to be
repeated on and as of the Closing Date (except as they relate
only to an earlier date) and shall survive the Closing.
Documents to be Delivered by the Seller at Closing.
At the Closing, the Seller shall execute, acknowledge
and/or deliver, as applicable, the following to the
Purchaser:
(a) A special warranty deed or its equivalent (the
"Deed") conveying title to the Property in the form of
Exhibit A annexed hereto and made a part hereof.
(b) The Assignment and Assumption of Leases and
Security Deposits in the form of Exhibit B annexed
hereto and made a part hereof assigning without warranty
or representation all of the Seller's right, title and
interest, if any, in and to the Leases in effect on the
Closing Date, all guarantees thereof and the security
deposits thereunder in the Seller's possession, if any
(the "Lease Assignment").
(c) The Assignment and Assumption of Contracts and
Licenses in the form of Exhibit C annexed hereto and
made a part hereof (the "Contract and License
Assignment") assigning without warranty or
representation all of the Seller's right, title and
interest, if any, in and to (i) all of the assignable
licenses, permits, certificates, approvals,
authorizations and variances issued for or with respect
to the Property by any governmental authority
(collectively, the "Licenses"), and (ii) all assignable
purchase orders, equipment leases, advertising
agreements, franchise agreements, license agreements,
management agreements, leasing and brokerage agreements
and other service contracts relating to the operation of
the Property (collectively, the "Contracts") not
terminated by Seller pursuant to the terms of this
Agreement. Only those Contracts that the Purchaser
elects to assume at the Closing shall be assigned.
(d) The Assignment and Assumption of Intangible
Property in the form of Exhibit D annexed hereto and
made part hereof assigning without warranty or
representation all of the Seller's right, title and
interest, if any, in and to all intangible property
owned by the Seller with respect to the operation of the
Property listed on Schedule 10 annexed hereto and made a
part hereof, including, without limitation, the trade
names "Carmel Park I" and "Carmel Park II" (the
"Intangible Property Assignment") (the Lease Assignment,
the Contract and License Assignment and the Intangible
Property Assignment are herein referred to collectively
as the "A & A Agreements").
(e) Executed counterparts of all Leases and New
Leases and any amendments, guarantees and other
documents relating thereto, together with a schedule of
all tenant security deposits thereunder and the accrued
interest on such security deposits payable to tenants
which are in the possession of or received by the
Seller.
(f) A bill of sale in the form of Exhibit E
annexed hereto and made a part hereof (the "Bill of
Sale") conveying, transferring and selling to the
Purchaser without warranty or representation all right,
title and interest of the Seller in and to all Personal
Property.
(g) Notices to the tenants of the Property in the
form of Exhibit F annexed hereto and made a part hereof
advising the tenants of the sale of the Property to the
Purchaser and directing that rents and other payments
thereafter be sent to the Purchaser or as the Purchaser
may direct.
(h) A certificate of a general partner of the
Seller that the Seller has taken all necessary
partnership action to authorize the execution, delivery
and performance of this Agreement and the consummation
of the transaction contemplated hereby.
(i) Executed originals of all Estoppel
Certificates required by Section 4.3 and any other
Estoppel Certificates, received by the Seller from
tenants prior to the Closing Date and not previously
delivered to the Purchaser.
(j) To the extent in the Seller's possession and
not already located at the Property, keys to all
entrance doors to, and equipment and utility rooms
located in, the Property.
(k) To the extent in the Seller's possession and
not already located at the Property, all Licenses.
(l) To the extent in the Seller's possession,
executed counterparts of all Contracts and all
warranties in connection therewith which are in effect
on the Closing Date and which are assigned by the
Seller.
(m) To the extent in the Seller's possession and
not located at the Building, plans and specifications of
the Buildings.
(n) The Transfer Tax Payments together with the
Transfer Tax Returns, if any.
(o) A "FIRPTA" affidavit sworn to by the Seller in
the form of Exhibit H annexed hereto and made a part
hereof. The Purchaser acknowledges and agrees that upon
the Seller's delivery of such affidavit, the Purchaser
shall not withhold any portion of the Purchase Price
pursuant to Section 1445 of the Internal Revenue Code of
1986, as amended, and the regulations promulgated
thereunder.
(p) Affidavit regarding liens.
(q) All other documents the Seller are required to
deliver pursuant to the provisions of this Agreement.
Documents to be Delivered by the Purchaser at Closing.
At the Closing, the Purchaser shall execute, acknowledge
and/or deliver, as applicable, the following to the Seller:
(a) The cash portion of the Purchase Price payable
at the Closing pursuant to Section 2, subject to
apportionments, credits and adjustments as provided in
this Agreement.
(b) The Bill of Sale.
(c) (i) Copies of the certificate of incorporation
and by-laws of the Purchaser and of the resolutions of
the board of directors of the Purchaser authorizing the
execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated by
this Agreement certified as true and correct by the
Secretary or Assistant Secretary of the Purchaser; (ii)
a good standing certificate issued by the state of
incorporation of the Purchaser, dated within thirty (30)
days of the Closing Date; (iii) a qualification to do
business certificate issued by the State of North
Carolina, dated within thirty (30) days of the Closing
Date; and (iv) an incumbency certificate executed by the
Secretary or Assistant Secretary of the Purchaser with
respect to those officers of the Purchaser executing any
documents or instruments in connection with the
transactions contemplated herein.
(d) The A & A Agreements.
(e) All other documents the Purchaser is required
to deliver pursuant to the provisions of this Agreement.
Operation of the Property prior to the Closing Date.
Between the date hereof and the Closing Date, the Seller
shall have the right to continue to operate and maintain the
Property in the same manner it is now operated and
maintained.
New Leases.
Except as hereinafter provided in this Section
10.1, the Seller may modify, extend, renew, cancel or
permit the expiration of any Lease or enter into any
proposed Lease of all or any portion of the Property
without the Purchaser's consent; provided, however, that
such Lease is on Seller's standard form with such
changes as Seller deems appropriate in the exercise of
its reasonable discretion. After the expiration of the
Purchaser's review period for Leases, the Seller shall
not modify, extend, renew or cancel (subject to Section
10.2) any Lease or enter into any proposed Lease of all
or any portion of the Property without the Purchaser's
prior consent in each instance.
New Lease Expenses.
If after the date of this Agreement and in
accordance with the provisions of Section 10.1 the
Seller enters into any Leases, or if there is any
extension or renewal of any Leases, whether or not
such Leases provide for their extension or renewal,
or any expansion or modification of any Leases
(each, a "New Lease"), the Seller shall keep
accurate records of all expenses (collectively,
"New Lease Expenses") incurred in connection with
each New Lease, including, without limitation, the
following: (i) brokerage commissions and fees
relating to such leasing transaction, (ii) expenses
incurred for repairs, improvements, equipment,
painting, decorating, partitioning and other items
to satisfy the tenant's requirements with regard to
such leasing transaction, (iii) reimbursements to
the tenant for the cost of any of the items
described in the preceding clause (ii), (iv) legal
fees for services in connection with the
preparation of documents and other services
rendered in connection with the effectuation of the
leasing transaction, (v) rent concessions relating
to the demised space provided the tenant has the
right to take possession of such demised space
during the period of such rent concessions, and
(vi) expenses incurred for the purpose of
satisfying or terminating the obligations of a
tenant under a New Lease to the landlord under
another lease (whether or not such other lease
covers space in the Property).
Allocation of New Lease Expenses.
The New Lease Expenses for each New Lease
allocable to and payable by the Seller shall be
determined by multiplying the amount of such New
Lease Expenses by a fraction, the numerator of
which shall be the number of days contained in that
portion, if any, of the term of such New Lease
commencing on the date on which the tenant
thereunder shall have commenced to pay fixed rent
("Rent Commencement Date") and expiring on the date
immediately preceding the Closing Date, and the
denominator of which shall be the total number of
days contained in the period commencing on the Rent
Commencement Date and expiring on the date of the
scheduled expiration of the term of such New Lease,
without provision for any optional extensions or
renewals, and the remaining balance of the New
Lease Expenses for each New Lease shall be
allocable to and payable by the Purchaser by
addition to the Purchase Price. At the Closing,
the Purchaser shall reimburse the Seller for all
New Lease Expenses theretofore paid by the Seller,
if any, in excess of the portion of the New Lease
Expenses allocated to the Seller pursuant to the
provisions of the preceding sentence. For purposes
of this Section 10.1.2, the Rent Commencement Date
under a renewal, extension, expansion or
modification of a Lease shall be deemed to be (i)
in the case of a renewal or extension (whether
effective prior to or after the Closing, or in the
form of an option exercisable in the future), the
first date during such renewal or extension period
after the originally scheduled expiration of the
term of such Lease on which the tenant under such
Lease commences to pay fixed rent, (ii) in the case
of an expansion (whether effective prior to or
after the Closing, or in the form of an option
exercisable in the future), the date on which the
tenant under such Lease commences to pay fixed rent
for the additional space, and (iii) in the case of
a modification not also involving a renewal,
extension or expansion of such Lease, the effective
date of such modification agreement. The
provisions of this Section 10.1.2 shall survive the
Closing.
Termination of Existing Leases.
Notwithstanding anything to the contrary contained
in this Agreement, the Seller reserves the right, but is
not obligated, to institute summary proceedings against
any tenant or terminate any Lease as a result of a
default by the tenant thereunder prior to the Closing
Date. The Seller makes no representations and assumes
no responsibility with respect to (i) the continued
occupancy of the Property or any part thereof by any
tenant and (ii) the fulfillment by any tenant of its
obligations under any Lease. The removal of a tenant
whether by summary proceedings or otherwise prior to the
Closing Date shall not give rise to any claim on the
part of the Purchaser. Further, the Purchaser agrees
that it shall not be grounds for the Purchaser's refusal
to close this transaction that any tenant is a holdover
tenant or in default under its Lease pursuant to any
economic or non-economic terms of its Lease on the
Closing Date and the Purchaser shall accept title
subject to such holding over or default without credit
against, or reduction of, the Purchase Price.
Contracts.
Except as hereinafter provided in this Section
10.3, the Seller may cancel, modify, extend, renew or
permit the expiration of Contracts or enter into any new
Contract without the Purchaser's prior consent. After
the expiration of the Purchaser's review period for
Contracts, the Seller shall not modify, extend, renew or
cancel (except as a result of a default by the other
party thereunder or if Purchaser has given notice
pursuant to Section 4.2(e) that a Contract is
unacceptable) any Contracts, or enter into any new
Contract without the Purchaser's prior consent in each
instance, which consent shall not be unreasonably
withheld or delayed, and if withheld, the Purchaser
shall promptly give the Seller a notice stating the
reasons therefor. If the Purchaser fails to reply within
five (5) days to the Seller's request for consent in a
notice given pursuant to this Section 10.3 or if the
Purchaser expressly denies its consent but fails to
provide the Seller with the reasons for such denial, the
Purchaser's consent shall be deemed to have been
granted.
Broker.
The Purchaser and the Seller represent and warrant to
each other that Joseph Dennis Pasquarella & Co. and The
Harris Group of the Carolinas, Inc. ( together, the "Broker")
is the sole broker with whom they have dealt in connection
with the Property and the transactions described herein. The
Seller shall be liable for, and shall indemnify the Purchaser
against, all brokerage commissions or other compensation due
to the Broker arising out of the transaction contemplated in
this Agreement, which compensation shall be paid subject and
pursuant to a separate agreement between the Seller and the
Broker. Each party hereto agrees to indemnify, defend and
hold the other harmless from and against any and all claims,
causes of action, losses, costs, expenses, damages or
liabilities, including reasonable attorneys' fees and
disbursements, which the other may sustain, incur or be
exposed to, by reason of any claim or claims by any broker,
finder or other person, except (in the case of the Purchaser
as indemnitor hereunder) the Broker, for fees, commissions or
other compensation arising out of the transactions
contemplated in this Agreement if such claim or claims are
based in whole or in part on dealings or agreements with the
indemnifying party. The obligations and representations and
warranties contained in this Section 11 shall survive the
termination of this Agreement and the Closing.
Casualty; Condemnation.
Damage or Destruction.
If a "material" part (as hereinafter defined) of
the Property is damaged or destroyed by fire or other
casualty, the Seller shall notify the Purchaser of such
fact and the Purchaser shall have the option to
terminate this Agreement upon notice to the Seller given
not later than ten (10) days after receipt of the
Seller's notice.
If an "immaterial" part (as hereinafter defined) of
the Property is damaged or destroyed by fire or other
casualty, the Seller shall notify the Purchaser of such
fact and the Purchaser shall have the option to
terminate this Agreement upon notice to the Seller given
not later than ten (10) days after receipt of the
Seller's notice provided, however, that the Purchaser's
election shall be ineffective if within ten (10) days
after the Seller's receipt of the Purchaser's election
notice, the Seller shall elect by notice to the
Purchaser to repair such damage or destruction and shall
thereafter complete such repair within ninety (90) days
after the then scheduled Closing Date at the time of the
Purchaser's election. If the Seller makes such election
to repair, the Seller shall have the right to adjourn
the Closing Date one or more times for up to ninety (90)
days in the aggregate in order to complete such repairs
and shall have the right to retain all insurance
proceeds which the Seller may be entitled to receive as
a result of such damage or destruction. If (i) the
Purchaser does not elect to terminate this Agreement as
to the damaged Property, or (ii) the Purchaser elects to
terminate this Agreement as to the damaged Property but
such election is ineffective because the damaged part of
the Property is immaterial and the Seller elects to
repair such damage and completes such repair within such
90-day period provided above the Purchaser shall close
title as provided in this Agreement and, at the Closing,
the Seller shall, unless the Seller has repaired such
damage or destruction prior to the Closing, (x) pay over
to the Purchaser the proceeds of any insurance collected
by the Seller less the amount of all costs incurred by
the Seller in connection with the repair of such damage
or destruction, (y) assign and transfer to the Purchaser
all right, title and interest of the Seller in and to
any uncollected insurance proceeds which the Seller may
be entitled to receive from such damage or destruction
and (z) give the Purchaser a credit against the Purchase
Price for the amount of any deductible not paid by the
Seller in connection with such insurance. A "material"
part of the Property shall be deemed to have been
damaged or destroyed if (i) the cost of repair or
replacement shall be equal to or greater than Two
Million Dollars or (ii) if the insurance available to
make any repairs is insufficient to pay for such
repairs. An "immaterial" part is any part which is not
material.
Condemnation.
If, prior to the Closing Date, all or any
"significant" portion (as hereinafter defined) of the
Property is taken by eminent domain or condemnation (or
is the subject of a pending taking which has not been
consummated), the Seller shall notify the Purchaser of
such fact and the Purchaser shall have the option to
terminate this Agreement upon notice to the Seller given
not later than ten (10) days after receipt of the
Seller's notice. If the Purchaser does not elect to
terminate this Agreement, or if an "insignificant"
portion ("insignificant" is herein deemed to be any
taking which is not "significant", as such term is
herein defined) of the Property is taken by eminent
domain or condemnation, at the Closing the Seller shall
assign and turnover, and the Purchaser shall be entitled
to receive and keep, all awards or other proceeds for
such taking by eminent domain or condemnation. A
"significant" portion of the Property means (i) ten
percent (10%) or more of the Property, (ii) any portion
of either of the two main buildings on the Land, (iii) a
portion of the parking areas if the taking thereof
reduces the remaining available number of parking spaces
below the minimum legally required, or (iv) a legally
required driveway on the Land if such driveway is the
predominant means of ingress thereto or egress
therefrom.
Termination.
If the Purchaser effectively terminates this
Agreement pursuant to Section 12.1 or 12.2, this
Agreement shall be terminated and the rights of the
parties shall be the same as if notice of termination
were given pursuant to Section 14.1.
Conditions Precedent to Closing.
Conditions Precedent to the Purchaser's
Obligations to Perform.
The Purchaser's obligation under this Agreement to
purchase the Property is subject to the fulfillment of
each of the following conditions: (i) the
representations and warranties of the Seller contained
herein shall be materially true, accurate and correct as
of the Closing Date except to the extent they relate
only to an earlier date; (ii) the Seller shall be ready,
willing and able to deliver title to the Property in
accordance with the terms and conditions of this
Agreement; (iii) any conditions precedent to the
Purchaser's obligation to purchase the Property which is
validly listed in the Purchaser's Termination Notice as
being unsatisfied has been satisfied; and (iv) the
Seller shall have delivered all the documents and other
items required pursuant to Section 8, and shall have
performed all other covenants, undertakings and
obligations, and complied with all conditions required
by this Agreement to be performed or complied with by
the Seller at or prior to the Closing.
Conditions Precedent to the Seller's Obligations
to Perform.
The Seller's obligation under this Agreement to
sell the Property to the Purchaser is subject to the
fulfillment of each of the following conditions: (i) the
representations and warranties of the Purchaser
contained herein shall be materially true, accurate and
correct as of the Closing Date; (ii) the Purchaser shall
have delivered the funds required hereunder and all the
documents to be executed by the Purchaser set forth in
Section 9 and shall have performed all other covenants,
undertakings and obligations, and complied with all
conditions required by this Agreement to be performed or
complied with by the Purchaser at or prior to the
Closing; (iii) all consents and approvals of
governmental authorities and parties to agreements to
which the Purchaser is a party or by which the
Purchaser's assets are bound that are required with
respect to the consummation of the transactions
contemplated by this Agreement shall have been obtained
and copies thereof shall have been delivered to the
Seller at or prior to the Closing; and (iv) the
additional matters set forth in Schedule 11 annexed
hereto and made a part hereof shall have occurred or
been delivered to the Seller, as applicable, at or prior
to the Closing.
Remedies Upon Failure to Satisfy Conditions.
In the event that any condition contained in
Sections 13.1 or 13.2 is not satisfied, the party
entitled to the satisfaction of such condition as a
condition to its obligation to close title shall have as
its sole remedy hereunder the right to elect to (i)
waive such unsatisfied condition whereupon title shall
close as provided in this Agreement or (ii) proceed as
provided in Section 14 hereof.
Remedies.
Seller's Inability to Perform.
If the Closing fails to occur by reason of the
Seller's inability to perform its obligations under this
Agreement which has not been waived pursuant to Section
13.3, then the Purchaser, as its sole remedy for such
inability of the Seller, may terminate this Agreement by
notice to the Seller. If the Purchaser elects to
terminate this Agreement, then this Agreement shall be
terminated and neither party shall have any further
rights, obligations or liabilities hereunder, except as
otherwise expressly provided herein (collectively, the
"Surviving Obligations"), and except that the Purchaser
shall be entitled to a return of the Deposit. Except as
set forth in this Section 14.1, the Purchaser hereby
expressly waives, relinquishes and releases any other
right or remedy available to it at law, in equity or
otherwise by reason of the Seller's inability to perform
its obligations hereunder. Notwithstanding anything to
the contrary herein, if the Seller's inability to
perform its obligations under this Agreement is a result
of any action of, or failure to act by, the Purchaser or
any of the Purchaser's Representatives, the Purchaser
shall not be relieved of its obligations under this
Agreement and Purchaser shall not be entitled to any
right or remedy provided in this Section 14.1 or
elsewhere in this Agreement.
Purchaser's Failure to Perform.
In the event of a default hereunder by the
Purchaser or if the Closing fails to occur by reason of
the Purchaser's failure or refusal to perform its
obligations hereunder, then the Seller's sole and
exclusive remedy shall be to terminate this Agreement by
notice to the Purchaser, in which case the Seller may
retain the Deposit as liquidated damages for all loss,
damage and expenses suffered by the Seller, it being
agreed that the Seller's damages are impossible to
ascertain, and neither party shall have any further
rights, obligations or liabilities hereunder, except for
the Surviving Obligations. Nothing contained herein
shall limit or restrict the Seller's ability to pursue
any rights or remedies it may have against the Purchaser
with respect to the Surviving Obligations. Except as
set forth in this Section 14.2 and the Surviving
Obligations, the Seller hereby expressly waives,
relinquishes and releases any other right or remedy
available to them at law, in equity or otherwise by
reason of the Purchaser's default hereunder or the
Purchaser's failure or refusal to perform its
obligations hereunder. Notwithstanding anything to the
contrary herein, if the Purchaser's default or the
Purchaser's failure or refusal to perform its
obligations under this Agreement is a result of any
action of, or failure to act by, the Seller or any of
the Seller's Affiliates, the Seller shall not be
relieved of its obligations under this Agreement and the
Seller shall not be entitled to any right or remedy
provided in this Section 14.2 or elsewhere in this
Agreement.
Seller's Failure to Perform.
If the Closing fails to occur by reason of the
Seller's failure or refusal to perform its obligations
hereunder which has not been waived by the Purchaser,
then the Purchaser, as its sole remedy hereunder, may
(i) terminate this Agreement by notice to the Seller or
(ii) seek specific performance from the Seller. As a
condition precedent to the Purchaser exercising any
right it may have to bring an action for specific
performance as the result of the Seller's failure or
refusal to perform their obligations hereunder, the
Purchaser must commence such an action within ninety
(90) days after the occurrence of such default. The
Purchaser agrees that its failure to timely commence
such an action for specific performance within such
ninety (90) day period shall be deemed a waiver by it of
its right to commence such an action. Notwithstanding
anything to the contrary herein, if the Seller's failure
or refusal to perform its obligations under this
Agreement is a result of any action of, or failure to
act by, the Purchaser or any of the Purchaser's
Representatives, the Purchaser shall not be relieved of
its obligations under this Agreement and Purchaser shall
not be entitled to any right or remedy provided in this
Section 14.3 or elsewhere in this Agreement.
Escrow.
The Escrow Agent shall hold the Downpayment and all
interest accrued thereon, if any (collectively, the
"Deposit") in escrow and shall dispose of the Deposit only in
accordance with the provisions of that certain Escrow
Agreement of even date herewith by and among the Escrow
Agent, the Purchaser and the Seller relating to the Property
(the "Escrow Agreement") in the form of Exhibit I hereto.
Simultaneously with their execution and delivery of this
Agreement, the Purchaser and the Seller shall furnish the
Escrow Agent with their true Federal Taxpayer Identification
Numbers so that the Escrow Agent may file appropriate income
tax information returns with respect to any interest earned
on or credited to the Deposit. The party entitled to the
economic benefit of the Deposit representing interest earned
on the Downpayment shall be the party responsible for the
payment of any tax due thereon.
The provisions of the Escrow Agreement shall survive the
termination of this Agreement and the Closing.
Notices.
All notices, elections, consents, approvals, demands,
objections, requests or other communications which the Seller
or the Purchaser may be required or desire to give pursuant
to, under or by virtue of this Agreement must be in writing
and (i) delivered by hand to the addresses set forth below,
or (ii) (a) sent by express mail or courier (for next
business day delivery), or (b) sent by certified or
registered mail, return receipt requested with proper postage
prepaid, addressed as follows:
If to the Seller:
Dean Witter Realty Income Partnership I, L.P.
c/o Dean Witter Realty Inc.
Two World Trade Center
64th Floor
New York, New York 10048
Attention: Ronald DiPietro
with a copy to:
Bingham Dana LLP
150 Federal Street
Boston, Massachusetts 02110
Attention: Vincent M. Sacchetti, Esq.
If to the Purchaser:
INVESCO Realty Advisors, Inc.
One Lincoln Center
5400 LBJ Freeway, Suite 1200
Dallas, Texas 75240
Attention: Ron Ragsdale
with a copy to:
Jackson Walker LLP
901 Main Street, Suite 6000
Dallas, Texas 75202
Attention: Michael P. Haggerty, Esq.
The Seller or the Purchaser may designate another
addressee or change its address for notices and other
communications hereunder by a notice given to the other
parties in the manner provided in this Section 16. A notice
or other communication sent in compliance with the provisions
of this Section 16 shall be deemed given and received (i) if
by hand, at the time of the delivery thereof to the receiving
party at the address of such party set forth above (or to
such other address as such party has designated as provided
above), (ii) if sent by express mail or overnight courier, on
the date it is delivered to the other party, or (iii) if sent
by registered or certified mail, on the third business day
following the day such mailing is made.
Property Information and Confidentiality.
The Purchaser agrees that, prior to the Closing, all
Property Information shall be kept strictly confidential and
shall not, without the prior consent of the Seller, be
disclosed by the Purchaser or the Purchaser's
Representatives, in any manner whatsoever, in whole or in
part, and will not be used by the Purchaser or the
Purchaser's Representatives, directly or indirectly, for any
purpose other than evaluating the Property. Moreover, the
Purchaser agrees that, prior to the Closing, the Property
Information will be transmitted only to the Purchaser's
Representatives (i) who need to know the Property Information
for the purpose of evaluating the Property, and who are
informed by the Purchaser of the confidential nature of the
Property Information and (ii) who agree to be bound by the
terms of this Section 17.
Press Releases and Private Disclosures.
The Purchaser and Seller, for the benefit of each
other, hereby agree that between the date hereof and the
Closing Date, they will not release or cause or permit
to be released any press notices, publicity (oral or
written) or advertising promotion relating to, or
otherwise privately announce or disclose or cause or
permit to be announced or disclosed to non-affiliated
third parties, in any manner whatsoever, the terms,
conditions or substance of this Agreement or the
transactions contemplated herein, without first
obtaining the written consent of the other party hereto.
It is understood that the foregoing shall not preclude
either party from discussing the substance or any
relevant details of the transactions contemplated in
this Agreement with any of its attorneys, accountants,
professional consultants or potential lenders, as the
case may be, or prevent either party hereto from
complying with Laws, including, without limitation,
governmental regulatory, disclosure, tax and reporting
requirements.
Return of Property Information.
In the event this Agreement is terminated, the
Purchaser and the Purchaser's Representatives shall
promptly deliver to the Seller all originals and copies
of the Property Information in the possession of the
Purchaser and the Purchaser's Representatives.
Notwithstanding anything contained herein to the
contrary, in no event shall the Purchaser be entitled to
receive a return of the Downpayment or the accrued
interest thereon, if any, if and when otherwise entitled
thereto pursuant to this Agreement until such time as
the Purchaser and the Purchaser's Representatives shall
have performed the obligations contained in the
preceding sentence.
Property Information Defined.
As used in this Agreement, the term "Property
Information" shall mean all information and documents in
any way relating to the Property, the operation thereof
or the sale thereof (including, without limitation,
Leases, Contracts and Licenses) furnished to, or
otherwise made available for review by, the Purchaser or
its directors, officers, employees, affiliates,
partners, brokers, agents or other representatives,
including, without limitation, attorneys, accountants,
contractors, consultants, engineers and financial
advisors (collectively, the "Purchaser's
Representatives"), by the Seller or any of the Seller's
Affiliates, or their agents or representatives,
including, without limitation, their contractors,
engineers, attorneys, accountants, consultants, brokers
or advisors, and the Investigations, or otherwise
reflecting their review or investigation of the
Property.
Remedies.
In addition to any other remedies available to the
Seller, the Seller shall have the right to seek
equitable relief, including, without limitation,
injunctive relief or specific performance, against the
Purchaser or the Purchaser's Representatives in order to
enforce the provisions of this Section 17.
The provisions of this Section 17 shall survive the
termination of this Agreement and the Closing.
Access to Records.
For a period of three (3) years subsequent to the
Closing Date, the Seller, the Seller's Affiliates and their
employees, agents and representatives shall be entitled to
access during business hours to all documents, books and
records given to the Purchaser by the Seller at the Closing
for tax and audit purposes, regulatory compliance, and
cooperation with governmental investigations upon reasonable
prior notice to the Purchaser, and shall have the right, at
their sole cost and expense, to make copies of such
documents, books and records.
Assignments.
This Agreement shall be binding upon and shall inure to
the benefit of the parties hereto and to their respective
heirs, executors, administrators, successors and permitted
assigns. This Agreement may be assigned by the Purchaser
without the prior written consent of the Seller provided the
Purchaser remains liable hereunder.
Entire Agreement, Amendments.
All prior statements, understandings, representations
and agreements between the parties, oral or written, are
superseded by and merged in this Agreement, which alone fully
and completely expresses the agreement between them in
connection with this transaction and which is entered into
after full investigation, neither party relying upon any
statement, understanding, representation or agreement made by
the other not embodied in this Agreement. This Agreement
shall be given a fair and reasonable construction in
accordance with the intentions of the parties hereto, and
without regard to or aid of canons requiring construction
against the Seller or the party drafting this Agreement.
This Agreement shall not be altered, amended, changed,
waived, terminated or otherwise modified in any respect or
particular, and no consent or approval required pursuant to
this Agreement shall be effective, unless the same shall be
in writing and signed by or on behalf of the party to be
charged.
Merger.
Except as otherwise expressly provided herein, the
Purchaser's acceptance of the Deed shall be deemed a
discharge of all of the obligations of the Seller hereunder
and all of the Seller's representations, warranties,
covenants and agreements herein shall merge in the documents
and agreements executed at the Closing and shall not survive
the Closing.
Limited Recourse.
The Purchaser agrees that it does not have and will not
have any claims or causes of action against any disclosed or
undisclosed officer, director, employee, trustee,
shareholder, partner, principal, parent, subsidiary or other
affiliate of the Seller, including, without limitation, Dean
Witter Realty Inc. and the parent and affiliates of Dean
Witter Realty Inc. (collectively, the "Seller's Affiliates"),
arising out of or in connection with this Agreement or the
transactions contemplated hereby. The Purchaser agrees to
look solely to the Seller and the Seller's assets directly
attributable to the Building for the satisfaction of the
Seller's liability or obligation arising under this Agreement
or the transactions contemplated hereby, or for the
performance of any of the covenants, warranties or other
agreements of the Seller contained herein, and further agrees
not to sue or otherwise seek to enforce any personal
obligation against any of the Seller's Affiliates with
respect to any matters arising out of or in connection with
this Agreement or the transactions contemplated hereby. The
total liability of the Seller hereunder shall in no event
exceed an amount equal to the Downpayment.
Miscellaneous.
Neither this Agreement nor any memorandum thereof shall
be recorded and any attempted recordation hereof shall be
void and shall constitute a default. This Agreement may be
executed in one or more counterparts, each of which so
executed and delivered shall be deemed an original, but all
of which taken together shall constitute but one and the same
instrument. Each of the Exhibits and Schedules referred to
herein and attached hereto is incorporated herein by this
reference. The caption headings in this Agreement are for
convenience only and are not intended to be a part of this
Agreement and shall not be construed to modify, explain or
alter any of the terms, covenants or conditions herein
contained. If any provision of this Agreement shall be
unenforceable or invalid, the same shall not affect the
remaining provisions of this Agreement and to this end the
provisions of this Agreement are intended to be and shall be
severable. This Agreement shall be interpreted and enforced
in accordance with the laws of the State of North Carolina
without reference to principles of conflicts of laws.
Time of the Essence.
Time is of the essence with respect to this Agreement,
including but not limited to the occurrence of the Closing as
of the originally scheduled date.
IRS Form 1099-S Designation.
In order to comply with information reporting
requirements of Section 6045(e) of the Internal Revenue Code
of 1986, as amended, and the Treasury Regulations thereunder,
the parties agree (i) to execute an IRS Form 1099-S
Designation Agreement in the form attached hereto as Exhibit
K at or prior to the Closing to designate the Title Company
as the party who shall be responsible for reporting the
contemplated sale of the Property to the Internal Revenue
Service (the "IRS") on IRS Form 1099-S; (ii) to provide the
Title Company with the information necessary to complete Form
1099-S; (iii) that the Title Company shall not be liable for
the actions taken under this Section 25, or for the
consequences of those actions, except as they may be the
result of gross negligence or willful misconduct on the part
of the Title Company; and (iv) that the Title Company shall
be indemnified by the parties for any costs or expenses
incurred as a result of the actions taken under this Section
25, except as they may be the result of gross negligence or
willful misconduct on the part of the Title Company. The
Title Company shall provide all parties to this transaction
with copies of the IRS Forms 1099-S filed with the IRS and
with any other documents used to complete IRS Form 1099-S.
Attorneys' Fees.
In any event that at any time Seller or Purchaser shall
institute any action or proceeding against the other relating
to this Agreement or any default hereunder, then and in that
event the prevailing party in such action or proceeding shall
be entitled to recover from the other party its reasonable
attorneys' fees which shall be deemed to have accrued on the
commencement of such action or proceeding and shall be
payable whether or not such action is prosecuted to judgment.
Counterparts.
This Agreement may be executed by the parties
hereto in separate counterparts, each of which when so
executed and delivered shall be an original, but all such
counterparts shall together constitute but one and the same
instrument.
IN WITNESS WHEREOF, this Agreement has been duly
executed by the parties hereto as of the day and year first
above written.
SELLER:
DEAN WITTER REALTY INCOME
PARTNERSHIP I, L.P.
By: Dean Witter Realty Income
Properties I, Inc., its managing
general partner
By:/s/Robert B. Austin
Name: Robert B. Austin
Title: Vice President
PURCHASER:
INVESCO REALTY ADVISORS, INC.
By:/s/Ron Ragsdale
Name: Ron Ragsdale
Title: Vice President
-3-
FIRST AMENDMENT TO PURCHASE AND SALE AGREEMENT
This FIRST AMENDMENT TO PURCHASE AND SALE AGREEMENT
("First Amendment") is executed on the dates set forth below,
by and between DEAN WITTER REALTY INCOME PARTNERSHIP I, L.P.,
a Delaware limited partnership ("Seller"), and INVESCO REALTY
ADVISORS, INC. ("Purchaser"), amending that certain Purchase
and Sale Agreement (the "Agreement"), dated November 10,
1997, by and between Seller and Purchaser, concerning certain
real property and improvements thereon located in Charlotte,
Mecklenburg County, North Carolina, and more particularly
described in the Agreement (the "Property").
For the consideration of the mutual agreements herein
contained, the parties hereby agree to amend the Agreement as
follows:
1. The Purchase Price referenced in Section 2 of the
Agreement is hereby amended to be $17,675,000.00.
2. The Purchaser agrees that all conditions precedent
contained in Section 4 of the Agreement have been satisfied,
with the expection of delivery of the estoppel certificate of
Royal Indemnity Company pursuant to Section 4.3. Purchaser
hereby waives any right of termination under Section 4.2 of
the Agreement, and any such right of termination shall be of
no further force and effect; provided, however, that
Purchaser's waiver hereunder shall not affect (i) the
condition precedent to Purchaser's obligation to close that
Purchaser receive an executed estoppel certificate of Royal
Indemnity Company pursuant to Section 4.3, (ii) any condition
precedent to Purchaser's obligation to close as comtemplated
in sections other than Section 4 of the Agreement, or (iii)
any termination rights of Purchaser contained in sections
other than Section 4 of the Agreement.
3. As Modified by this First Amendment, the Agreement
remains in full force and effect.
4. Capitalized terms shall have the meanings assigned
to them in the Agreement, unless otherwise expressly
delineated to the contrary. References to section numbers
refer to section numbers contained in the Agreement, unless
otherwise delineated to the contrary.
5. This First Amendment shall be enforceable if
executed in counterparts and/or by facsimile.
Executed by Purchased on this 2 day of December, 1997.
PURCHASER:
INVESCO REALTY ADVISORS, INC.
By:/s/Ron Ragsdale
Name: Ron Ragsdale
Title: Vice President
Executed by Seller on this 2nd day of December, 1997.
SELLER:
DEAN WITTER REALTY INCOME
PARTNERSHIP I, L.P., a Delaware
limited partnership
By: Dean Witter Realty Income
Properties I, Inc., its
managing
general partner
By:/s/Robert B. Austin
Name: Robert B. Austin
Title: Vice President
