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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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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 3, 1999
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NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP
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(Exact Name of Registrant as Specified in Charter)
MASSACHUSETTS 0-12138 04-2619298
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(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation File Number) Identification No.)
39 BRIGHTON AVENUE, ALLSTON, MASSACHUSETTS 02134
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (617) 783-0039
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N/A
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(Former Name or Former Address, if Changed Since Last Report)
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
On December 3, 1999, the Registrant acquired through a controlled
affiliate, 180 residential units, known as "West Colonial," located at
18 Westland Ave, Brockton, Massachusetts for a purchase price of
approximately $8.9 million. The seller, WCA Limited Partnership, has no
relationship to the Registrant or its controlled affiliate, which was formed
for the specific purpose of acquiring the property.
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The Registrant acquired the property through WCB Associates, LLC
("WCB"), a Massachusetts limited liability company, formed for the specific
purpose of acquiring the property. WCB has two managers: WCB Associates,
Inc., a Massachusetts corporation; and an individual, Melvin Herman. The
Registrant is the sole stockholder of WCB Associates, Inc. WCB Associates,
Inc. is also a one percent member of WCB and the Registrant owns the
remaining ninety-nine percent (99%) interest in WCB. Mr. Herman is defined in
the WCB Operating Agreement as a "special manager." With respect to the
activities of WCB, Mr. Herman's consent is only needed under limited
circumstances. For example, WCB requires the consent of Mr. Herman (i) to
change in the general character of the business of WCB; (ii) to make any
loans to the manager or the members or their affiliates; (iii) to sell all or
substantially all of the assets of the WCB; (iv) to dissolve, wind up or
liquidate WCB; (v) to merge, consolidate or acquire all or substantially all
the assets of another person or entity; and (vi) to institute proceedings to
be adjudicated bankrupt or insolvent, or to consent to such proceedings
against WCB. Ronald Brown (the President of the Registrant's General Partner)
is the President of WCB Associates, Inc. and Harold Brown (the Treasurer of
the Registrant's General Partner) is Treasurer.
The Registrant assumed an existing mortgage in connection with its
acquisition prior to the Registrant's acquisition of the West Colonial
through WCB, West Colonial had an existing first mortgage of $ 5.265
million, which at closing had amortized to $5,207,172.25. The net
difference($3,692,827), before adjustments, was provided by use of the
Registrant's cash reserves which had accumulated from operations and the
refinancing of the Registrant's Westgate Woburn property earlier in March
1999. The 10 year loan assumed by the Registrant has a maturity date of Oct.
1, 2008 and is amortizing over 30 years with an interest rate of 6.52%.
Management believes that the property's net operating income budgeted for
fiscal year 2000 is $872,000, with a debt service of $400,000, leaving a cash
flow before capital expenditure of $472,000 for a 12.7% cash on cash return,
provided, however, no assurance can be made that Registrant will realize such
cash on cash return in fiscal year 2000 on said property. The original
conduit loan was made by Berkshire Mortgage Finance Corporation and is
presently serviced by Berkshire Mortgage Finance Corporation.
At the time of the filing of this Current Report on Form 8-K, the
financial statements relating to foregoing matters were not available. Such
financial statements will be included in an amendment to this Current Report
as soon as they are made available by the Registrant's accountants. In
addition, the Registrant anticipates that it will close on the purchase of
another residential property on or before December 31, 1999. The Registrant
will either report on such new purchase in a new filing on Form 8-K or in its
anticipated amendment to this Current Report, depending on the timing and
availability of said information.
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ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
To be included in a subsequent filing amending this Current Report.
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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 under
signed hereunto duly authorized.
New England Realty Associates
Limited Partnership
By: NEWREAL, INC.
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Its General Partner
By: /s/ RONALD BROWN
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EXHIBIT INDEX
Exhibit
Number
2.1 Purchase and Sale Agreement, dated September __, 1999, between WCA
Limited Partnership as seller and New England Realty Associated, as
buyer
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EXHIBIT 2.1
PURCHASE AND SALE AGREEMENT
BETWEEN
WCA LIMITED PARTNERSHIP
AS SELLER,
AND
NEW ENGLAND REALTY ASSOCIATES,
AS BUYER
FOR WESTSIDE COLONIAL VILLAGE APARTMENTS LOCATED AT
18 WESTLAND AVENUE
BROCKTON, MASSACHUSETTS
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TABLE OF CONTENTS
<TABLE>
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PAGE
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1. SALE AND PURCHASE............................................................2
2. PURCHASE PRICE...............................................................2
2.1. DEPOSIT....................................................................2
2.2. PAYMENT AT CLOSING; FUNDING AGREEMENT......................................2
2.3. ASSUMPTION OF MORTGAGE DEBT................................................2
3. REPRESENTATIONS AND WARRANTIES OF SELLER.....................................2
3.1. AUTHORITY..................................................................3
3.2. NO CONFLICT................................................................3
3.3. NO CONDEMNATION............................................................3
3.4. NO NOTICES.................................................................3
3.5. LITIGATION.................................................................3
3.6. FIRPTA.....................................................................3
3.7. RENT ROLL..................................................................3
3.8. SERVICE CONTRACTS..........................................................3
3.9. BROKERAGE COMMISSIONS......................................................4
3A. LIMITATIONS REGARDING REPRESENTATIONS AND WARRANTIES........................4
4. CONDITIONS PRECEDENT TO BUYER'S OBLIGATIONS..................................4
4.1. ACCURACY OF REPRESENTATIONS................................................4
4.2. PERFORMANCE................................................................4
4.3. DOCUMENTS AND DELIVERIES...................................................4
4.4. DUE DILIGENCE; LENDER'S TRANSFER CONSENT; ACCESS; PURCHASE "AS IS."........4
4.5. SURVEY.....................................................................6
4.6. TITLE......................................................................6
4.7. MORTGAGE DEBT..............................................................7
4.8. MATERIAL ADVERSE CHANGE....................................................7
5. FAILURE OF CONDITIONS........................................................7
6. NEW LEASES AND LEASE MODIFICATIONS...........................................7
6.1. BUYER APPROVAL.............................................................7
7. CLOSING; DELIVERIES..........................................................8
7.1. TIME OF CLOSING............................................................8
7.2. SELLER DELIVERIES..........................................................8
7.3. BUYER DELIVERIES...........................................................9
8. APPORTIONMENTS; TAXES; EXPENSES.............................................10
8.1 APPORTIONMENTS.............................................................10
8.1.1. TAXES AND OPERATING EXPENSES.........................................10
8.1.2. RENT.................................................................10
8.1.3. CHARGES UNDER ASSIGNED CONTRACTS.....................................11
8.2. EXPENSES..................................................................11
9. DAMAGE OR DESTRUCTION; CONDEMNATION; INSURANCE..............................11
</TABLE>
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10. REMEDIES...................................................................11
10.1. BUYER DEFAULT............................................................11
10.2. SELLER DEFAULT...........................................................12
11. CONFIDENTIALITY............................................................12
12. POSSESSION.................................................................12
13. NOTICES....................................................................12
14. BROKERS....................................................................14
15. ESCROW AGENT...............................................................14
15.1. OBLIGATIONS..............................................................14
15.2. RELIANCE.................................................................14
15.3. INDEMNIFICATION..........................................................14
15.4. DISPUTES.................................................................14
15.5. COUNSEL..................................................................15
15.6. INTEREST.................................................................15
16. REPRESENTATIONS OF BUYER...................................................15
16.1. AUTHORITY................................................................15
16.2. NO CONFLICT..............................................................15
16.3. SOURCE OF FUNDS..........................................................15
17. MISCELLANEOUS..............................................................15
17.1. ASSIGNABILITY............................................................15
17.2. GOVERNING LAW; BIND AND INURE............................................16
17.3. RECORDING................................................................16
17.4. TIME OF THE ESSENCE......................................................16
17.5. HEADINGS.................................................................16
17.6. COUNTERPARTS.............................................................16
17.7. EXHIBITS.................................................................16
17.8. SURVIVAL.................................................................16
17.9. USE OF PROCEEDS TO CLEAR TITLE...........................................16
17.10. SUBMISSION NOT AN OFFER OR OPTION.......................................16
17.11. ENTIRE AGREEMENT; AMENDMENTS............................................17
17.12. MONTHLY OPERATING REPORTS...............................................17
EXHIBIT A - DESCRIPTION OF LAND.................................................19
EXHIBIT A-1 -PERMITTED ENCUMBRANCES.............................................21
EXHIBIT A-2 -RENT ROLL..........................................................23
EXHIBIT A-3 -SERVICE CONTRACTS..................................................24
EXHIBIT B - FORM OF DEED........................................................25
EXHIBIT C - BILL OF SALE........................................................27
EXHIBIT D - ASSIGNMENT AND ASSUMPTION OF LEASES.................................29
EXHIBIT E - ASSIGNMENT OF WARRANTIES AND PERMITS................................32
</TABLE>
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EXHIBIT F - ASSIGNMENT AND ASSUMPTION OF CONTRACTS..............................34
EXHIBIT G - NON-FOREIGN AFFIDAVIT...............................................37
EXHIBIT H - FUNDING AND ESCROW AGREEMENT........................................38
EXHIBIT I - SUPPLEMENTAL ESCROW AGREEMENT.......................................41
</TABLE>
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PURCHASE AND SALE AGREEMENT
THIS PURCHASE AND SALE AGREEMENT ("AGREEMENT") is made as of the ___
day of September ___, 1999 by and among WCA LIMITED PARTNERSHIP, a Massachusetts
limited partnership with an address of 169 Beach Avenue, Hull, Massachusetts
02045 (the "SELLER"), NEW ENGLAND REALTY ASSOCIATES, a Massachusetts limited
partnership, with an address of 39 Brighton Avenue, Boston, Massachusetts
("BUYER"), and joined in for the limited purposes set forth herein by
Commonwealth Title Insurance Company, as escrow agent ("ESCROW AGENT").
BACKGROUND
A. Seller owns the following real and personal property (collectively,
the "PROPERTY"):
(1) A parcel of land (the "LAND") together with the apartment
building containing 180 apartment units (the "BUILDINGS") located thereon known
as Westside Colonial Apartments and located at 18 Westland Road, Brockton,
Massachusetts, as more particularly described in EXHIBIT A hereto, together with
all easements, rights and privileges appurtenant thereto, and together with all
improvements (the Buildings and such other improvements being hereafter
collectively referred to as the "IMPROVEMENTS") located thereon, and subject to
the Permitted Encumbrance set forth on EXHIBIT A-1 hereto (collectively, the
"REAL PROPERTY");
(2) All fixtures, equipment, furniture, furnishings, appliances,
supplies and other personal property of every nature and description attached or
pertaining to, or otherwise used in connection with the Real Property, to the
extent owned by Seller and located within, and used in connection with the Real
Property (the "PERSONALTY"); and
(3) To the extent owned by Seller, all intangible property used or
useful in connection with the foregoing, including, without limitation, all
contract rights, guarantees, licenses, permits and warranties, including all of
Seller's right, title and interest in the name "Westside Colonial Village".
The Property does not include any and all reserves currently required
by Berkshire, and at Closing all such amounts shall be retained by Seller. Buyer
shall be required to fund any reserves required by Berkshire as conditions to
the approval of the transfer of the Mortgage Debt.
B. Seller is prepared to sell, transfer and convey the Property to
Buyer, and Buyer is prepared to purchase and accept the same from Seller for the
Purchase Price and on the other terms and conditions hereinafter set forth.
Seller shall convey the Real Property by a good and sufficient Massachusetts
Quitclaim Deed (the "Deed") running to Buyer or to such nominee as Buyer may
designate by notice to Seller at least seven (7) days before the Deed is to be
delivered as herein provided. The Deed shall convey good and clear record and
marketable and insurable title to the Real Property, free from all liens,
agreements, encumbrances and encroachments
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TERMS AND CONDITIONS
from, on or against the Real Property, except for the "Permitted Encumbrances"
(as herein defined).
In consideration of the mutual covenants and agreements herein
contained, and intending to be legally bound hereby, the parties hereto agree:
1. SALE AND PURCHASE. Seller hereby agrees to sell, transfer and convey
the Property to Buyer, and Buyer hereby agrees to purchase and accept the
Property from Seller, in each case for the Purchase Price and on and subject to
the other terms and conditions set forth in this Agreement.
2. PURCHASE PRICE. The purchase price for the Property (the "PURCHASE
PRICE") shall be Eight Million Nine Hundred Thousand Dollars ($8,900,000.00),
which, subject to the terms and conditions hereinafter set forth, shall be paid
to Seller by Buyer as follows:
2.1. DEPOSIT. Concurrent with the execution and delivery of this
Agreement by Buyer, Buyer shall have delivered to Escrow Agent, in immediately
available funds, to be held in escrow and delivered in accordance with this
Agreement, a cash deposit totalling Two Hundred Fifty Thousand Dollars
($250,000.00) (the "DEPOSIT").
2.2. PAYMENT AT CLOSING; FUNDING AGREEMENT. At the consummation of
the transaction contemplated hereby (the "CLOSING"), Buyer shall deliver to
Escrow Agent cash in the amount of Three Million Three Hundred Eighty-Five
Thousand Dollars ($3,385,000), and subject to adjustments and apportionments as
set forth herein. The Purchase Price, subject to adjustments and apportionments
as set forth herein, shall be paid at Closing by wire transfer of immediately
available federal funds, transferred to the order or account of Escrow Agent or
such other person as Seller may designate in writing.
2.3. ASSUMPTION OF MORTGAGE DEBT. At Closing, Buyer shall assume the
existing first mortgage on the Real Property (the "Mortgage Debt") owed to
Berkshire Mortgage Finance Corporation or its assignee (the "Lender"). The
estimated unpaid principal amount of the Mortgage Debt is Five Million Two
Hundred Sixty-Five Thousand Dollars ($5,265,000). The cash portion of the
Purchase Price shall be adjusted to reflect the actual unpaid principal amount
of the Mortgage Debt on the date of Closing.
The delivery and recording of documents and the disbursement of funds
shall be effectuated at the Closing by the use of a Funding and Escrow Agreement
substantially in the form of EXHIBIT H attached hereto.
3. REPRESENTATIONS AND WARRANTIES OF SELLER. Subject to all matters
disclosed in any document delivered to Buyer by Seller or on any exhibit
attached hereto, and subject to any information contained in any written report,
memorandum or correspondence addressed to Buyer, its counsel or any consultant
retained by Buyer in connection with Buyer's investigation
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of the Property or other information disclosed in writing to Buyer by Seller or
any other person after the date hereof and prior to the Closing (all such
matters being referred to herein as "EXCEPTION MATTERS"), and without intending
to limit Buyer's due diligence rights under Section 4.4, Seller represents and
warrants to Buyer as follows:
3.1. AUTHORITY. Seller is a limited partnership validly existing
under the laws of the Commonwealth of Massachusetts and has all requisite power
and authority to enter into this Agreement and perform its obligations
hereunder. The execution and delivery of this Agreement has been duly
authorized.
3.2. NO CONFLICT. The execution and delivery of this Agreement and
the consummation of the transactions contemplated hereunder on the part of
Seller does not and will not conflict with or result in the breach of any
material terms or provisions of, or constitute a default under, or result in the
creation or imposition of any lien, charge, or encumbrance upon any of the
Property or assets of the Seller by reason of the terms of any contract,
mortgage, lien, lease, agreement, indenture, instrument or judgment to which
Seller is a party or which is or purports to be binding upon Seller or which
otherwise affects Seller, which will not be discharged, assumed or released at
Closing. No action by any federal, state or municipal or other governmental
department, commission, board, bureau or instrumentality is necessary to make
this Agreement a valid instrument binding upon Seller in accordance with its
terms.
3.3. NO CONDEMNATION. To Seller's knowledge, Seller has not received
any written notice of any pending or contemplated condemnation, eminent domain,
or similar proceeding with respect to all or any portion of the Real Property.
3.4. NO NOTICES. Seller has not received written notice of existing
violations of any federal, state, county or municipal laws, ordinances, orders,
codes, regulations or requirements affecting the Real Property which have not
been cured.
3.5. LITIGATION. To Seller's knowledge, there is no material action,
suit or proceeding pending or threatened against or affecting the Property, or
arising out of the ownership, management or operation of the Real Property, this
Agreement or the transactions contemplated hereby.
3.6. FIRPTA. Seller is not a "foreign person" as defined in Section
1445(f)(3) of the Internal Revenue Code.
3.7. RENT ROLL. Attached hereto on EXHIBIT A-2 is a true and
complete copy of the rent roll for the Property. Seller has not received any
written notices of default on the part of Seller or claims of rights of set-off
from any tenant listed on the rent roll that has not been cured. The rent roll
accurately reflects the amount all security deposits and advance rental payments
held by Seller with respect to the Property.
3.8. SERVICE CONTRACTS. To the best of Seller's knowledge, there are
no management, garbage removal, maintenance agreements, or service contracts and
agreements
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relating to the real property that cannot be terminated on or before the
Closing, other than those listed on EXHIBIT A-3 hereto.
3.9. BROKERAGE COMMISSIONS. To the best of Seller's knowledge, there
are no brokerage commissions due under any of the leases affecting the Property
which are due or will become due after the date of Closing.
3A. LIMITATIONS REGARDING REPRESENTATIONS AND WARRANTIES. As used in
this Agreement, or in any other agreement, document, certificate or instrument
delivered by Seller to Buyer, the phrase "to Seller's knowledge" or any similar
phrase shall mean the actual, not constructive or imputed, knowledge of Paul
Townsend, without any obligation on either of their parts to make any
independent investigation of the matters being represented and warranted, or to
make any inquiry of any other persons, or to search or examine any files,
records, books, correspondence and the like.
Seller shall have no liability whatsoever to Buyer with respect to any
Exception Matters. Buyer agrees to inform Seller promptly in writing if it
discovers that any representation or warranty of Seller is inaccurate in any
material respect, or if it believes that Seller has failed to deliver to Buyer
any document or material which it is obligated to deliver hereunder.
4.CONDITIONS PRECEDENT TO BUYER'S OBLIGATIONS. All of Buyer's
obligations hereunder are expressly conditioned on the satisfaction at or before
the time of Closing hereunder, or at or before such earlier time as may be
expressly stated below, of each of the following conditions (any one or more of
which may be waived in writing in whole or in part by Buyer, at Buyer's option):
4.1. ACCURACY OF REPRESENTATIONS. All of the representations and
warranties of Seller contained in this Agreement shall have been true and
correct in all material respects when made, and shall be true and correct in all
material respects on the date of Closing with the same effect as if made on and
as of such date.
4.2. PERFORMANCE. Seller shall have performed, observed and complied
with all material covenants, agreements and conditions required by this
Agreement to be performed, observed and complied with on its part prior to or as
of Closing hereunder.
4.3. DOCUMENTS AND DELIVERIES. All instruments and documents
required on Seller's part to effectuate this Agreement and the transactions
contemplated hereby shall be delivered to Buyer and shall be in form and
substance consistent with the requirements herein.
4.4. DUE DILIGENCE; LENDER'S TRANSFER CONSENT; ACCESS; PURCHASE "AS
IS."
4.4.1. Buyer shall have until (i) September 27, 1999 at 5:00
P.M. to conduct the following due diligence: building, site , property
condition, environmental reports and inspections, survey, permits, lead paint,
zoning, and approvals reviews, and verification of the Property's operating and
income statements, leases, contracts and service agreements, except
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that Buyer shall have until October 4, 1999 at 5:00 P.M. to review the results
of Buyer's subsurface environmental tests. The Seller shall cooperate in good
faith with the Buyer and provide copies of all such information reasonably
requested by Buyer or by Berkshire, and which is in Seller's possession. If the
results of the Buyer's due diligence review and inspections are not satisfactory
to the Buyer or Berkshire, in their sole and exclusive judgement, the Buyer may
so notify the Seller in writing (which notice shall include a statement as to
the reason for termination and shall include copies of Buyer's due diligence
reports, provided as to those reports that are not yet in Seller's possession,
Seller shall promptly deliver such reports upon receipt) at any time prior to
the expiration of the due diligence period and terminate this Agreement, in
which case the Deposit shall be refunded to Buyer, together with all interest
earned thereon, and thereupon this Agreement shall become null and void without
recourse to the parties hereto.
4.4.2. Buyer shall use its best efforts and have until November
15, 1999 to satisfy the Lender that Buyer's (or Buyer's nominee) is an
appropriate and acceptable replacement borrower with respect to the Mortgage
Debt, all on terms and conditions consistent with the Mortgage Debt documents,
and to obtain Lender's written consent to Buyer's assumption of the Mortgage
Debt (the "LENDER'S TRANSFER CONSENT"). If Buyer, despite its best efforts, is
unable to obtain Lender's consent to Buyer's assumption of the Mortgage Debt on
or before such date then Buyer or Seller may terminate this Agreement by written
notice to the other party, and upon such termination the Deposit, together with
all interest earned thereon shall be paid to Buyer. If Lender approves the
transfer of the Mortgage Debt, Seller shall pay a mortgage transfer fee to
Berkshire at the Closing in an amount not to exceed one percent (1%) of the
outstanding balance of the Loan and Buyer shall pay all other Lender costs
associated with its assumption of the Mortgage Debt. Any and all reserves being
held by Lender on the account of Seller shall remain the property of Seller and
Buyer shall be responsible for funding reserves required by Lender as a
condition of the Lender's Transfer Consent.
4.4.3. From and after the date hereof and through the Closing,
Buyer, its agents and representatives, shall be entitled to enter upon the
Property (such entry to be in the presence of Seller or Seller's agent, during
regular business hours, and coordinated through Seller's property manager),
including all leased areas, upon twenty-four (24) hours prior notice to Seller,
to perform inspections and non-invasive tests of the Property, including
surveys, studies, examinations and tests of all structural and mechanical
systems within the Improvements, and to examine the books and records of Seller
and Seller's property manager relating to the Property. Before entering upon the
Property, Buyer shall furnish to Seller evidence of general comprehensive and
contractual liability insurance coverage of at least $2,000,000 and insuring
against such risks as Seller may reasonably require. Such insurance shall name
Seller as an additional insured. Notwithstanding the foregoing, Buyer shall not
be permitted to interfere unreasonably with Seller's operations at the Property
or interfere with any tenant's use and quiet enjoyment of the Property, and the
scheduling of any inspections shall take into account the timing and
availability of access to the tenant's premises, pursuant to the tenant's rights
under the leases or otherwise. If Buyer wishes to engage in any testing which
will damage or disturb any portion of the Property, Buyer shall obtain Seller's
prior consent thereto, which may be refused or conditioned as Seller may deem
appropriate. Without limiting the generality of the
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foregoing, Seller's written approval shall be required prior to any testing or
sampling of surface or subsurface soils, surface water, groundwater or any
materials in or about the Improvements in connection with Buyer's environmental
due diligence. Buyer shall repair at Buyer's sole cost and expense, any damage
to the Property caused by any such tests or investigations, and Buyer shall
indemnify and defend Seller from any and all loss, cost, liabilities, claims,
and expenses whatsoever (including reasonable attorneys' fees of counsel
selected by Seller) arising out of any damage to persons or property occurring
in or about the Property arising in any way from the inspection permitted
hereby, and shall return the Property to the same condition as it was in prior
to the inspection. The foregoing indemnification shall survive Closing or the
termination of this Agreement.
4.4.4. Buyer acknowledges and agrees that Buyer is acquiring
the Property in its "AS IS" condition, WITH ALL FAULTS, IF ANY, AND EXCEPT AS
PROVIDED IN ARTICLE 3 HEREOF, WITHOUT ANY WARRANTY, EXPRESS OR IMPLIED. Other
than as expressly set forth herein, neither Seller nor any agents,
representatives, or employees of Seller have made any representations or
warranties, direct or indirect, oral or written, express or implied, to Buyer or
any agents, representatives, or employees of Buyer with respect to the condition
of the Property, its fitness for any particular purpose, or its compliance with
any laws, and Buyer is not aware of and does not rely upon any such
representation to any other party. Buyer acknowledges that Buyer has been
afforded the opportunity to make such inspections (or have such inspections made
by consultants) as it desires of the Property and all factors relevant to its
use, including, without limitation, the interior, exterior, and structure of all
Improvements, and the condition of soils and subsurfaces. Except as otherwise
expressly set forth in any representation or warranty made by Seller in ARTICLE
3 of this Agreement, any information, documents or materials which have been or
hereafter are made available to Buyer are made available solely as an
accommodation to Buyer in the conduct of its due diligence, and Seller makes no
representation or warranty as to the accuracy thereof.
4.5. SURVEY. Seller has provided Buyer with a copy of the
survey for the Real Property entitled "Title Insurance Plan of Land in Brockton,
Massachusetts" prepared for Seller by Hayward-Boynton & Williams, Inc., dated
September 15, 1993 and revised through July 23, 1998 (the "1998 SURVEY"). Buyer
hereby accepts all matters shown on the 1998 Survey and all matters that would
have been shown on an update of the 1998 Survey as of the date hereof (all such
matters shall be considered "Permitted Encumbrances").
4.6. TITLE. Seller has provided Buyer with a copy of the title
insurance policy for the Property issued by First American Title Insurance
Company and dated September 30, 1998 (the "1998 TITLE POLICY"). Buyer hereby
accepts all matters set forth in the 1998 Title Policy, except for Schedule B,
Items 9 and 10 (all such matters shall be considered "Permitted Encumbrances").
Buyer has ordered an update of the 1998 Title Policy and Commitment for an
owner's title policy (1992 ALTA Owner's Policy) (the "COMMITMENT") and on or
before October 4, 1999 shall furnish to Seller (a) a copy of the Commitment, and
(b) a written statement specifically identifying any liens or encumbrances or
other defects that have a materially adverse impact on title to the Property
(other than the Permitted Exceptions), together with Buyer's reasons for
objecting to the same. If exceptions to title appear on the Commitment and if
Seller
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is unable or elects not to eliminate such exceptions to title and, accordingly,
is unable to convey title to the Property in accordance with the provisions of
this Agreement, Seller shall so notify Buyer and Buyer, within five (5) days
thereafter, shall either (x) elect to terminate this Agreement by written notice
given to Seller, and thereupon the Deposit shall be refunded to Buyer and all
obligations of the parties hereto shall cease, and this Agreement shall be void
and without recourse to the parties hereto, or (y) elect to accept title to the
Premises subject to such exceptions, without any reduction in the Purchase Price
and without any liability on the part of Seller, in which case Seller shall
convey such title to the Property without any reduction of the Purchase Price.
If Buyer shall not make such election within such (10) day period, Buyer shall
be deemed to have elected clause (y) above with the same force and effect as if
Buyer had elected clause (y) within such five (5) day period. Buyer shall be
deemed to have accepted all title matters not objected to under this paragraph
(as well as those objections that Seller is unable or unwilling to cure and
which objections Buyer then waives), and all such title matters shall be
considered "Permitted Encumbrances".
4.7. MORTGAGE DEBT. Seller shall not be in default under the
terms of the Mortgage Debt, provided Seller shall have twenty (20) days to cure
any default, notice of which Seller first receives within ten (10) days of the
date of the Closing, and the Closing Date shall be extended to permit Seller to
so cure such a default.
4.8. MATERIAL ADVERSE CHANGE. Between the date hereof and the
date of Closing, except as set forth in ARTICLE 9, there shall have been no
material adverse change in the physical condition of the Property, normal wear
and tear excepted, and no new survey or title matter not approved or deemed
approved by Buyer pursuant to SECTIONS 4.5 OR 4.6 shall have arisen subsequent
to the date hereof unless the same is, in Buyer's sole satisfaction, discharged
or insured over in Buyer's title policy at Closing.
5. FAILURE OF CONDITIONS. In the event Seller shall not be able to
convey title to the Property subject only to the matters approved or deemed
approved by Buyer pursuant to SECTIONS 4.5, 4.6 AND 4.7 hereof, on the date of
Closing in accordance with the provisions of this Agreement, then Buyer shall
have the option, exerciseable by written notice to Seller at or prior to
Closing, of (1) accepting at Closing such title as Seller is able to convey
and/or waiving any unsatisfied condition precedent, with no reduction in the
Purchase Price, or (2) declining to proceed to Closing, and terminating this
Agreement. In the latter event, except as expressly set forth herein, all
obligations, liabilities and rights of the parties under this Agreement shall
terminate, and the Deposit, together with all interest earned thereon, shall be
returned to Buyer.
6. NEW LEASES AND LEASE MODIFICATIONS.
6.1. BUYER APPROVAL. After the execution of this Agreement, if this
Agreement shall not have been terminated by Buyer, Seller shall not, without the
written consent of Buyer, which consent may not be unreasonably withheld: (i)
modify or renew any lease term for any apartment unit at the Property for a term
in excess of twelve (12) months; (ii) enter into any new lease at rental rates
lower than those rents currently in effect for comparable apartments in the rent
roll delivered to Buyer by Seller. Buyer shall be deemed to have consented to
any proposed
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lease or lease modification if it has not responded to Seller within five (5)
business days after receipt of a request for approval of such lease or lease
modification, or (iii) allow the occupancy rate for the Property's apartments to
fall below 95%. In all other respects Seller shall continue to manage and
operate the Property in a good faith and in a manner consistent with Seller's
current business practice, provided Seller shall not enter into any new service
contracts for the Property which cannot be terminated at Closing, and Seller
shall not remove any Personalty from the Property, except for purposes of
repairing and/or replacing such Personalty.
7. CLOSING; DELIVERIES.
7.1. TIME OF CLOSING. The Closing shall take place at 10:00 a.m. on
the tenth (10) business day after the Lender's Transfer Consent has been
obtained by Buyer at the offices of Brown, Rudnick, Freed & Gesmer, P.C., 745
Atlantic Avenue, 5th Floor, Boston, Massachusetts, unless otherwise agreed to in
writing by both Seller and Buyer.
7.2. SELLER DELIVERIES. At Closing, Seller shall deliver to Buyer
the following, and it shall be a condition to Buyer's obligation to close
that Seller shall have delivered the same to Buyer:
7.2.1. A Massachusetts Quitclaim Deed ("DEED") to the Real
Property from Seller, duly executed and acknowledged by Seller and substantially
in the form of EXHIBIT B attached hereto.
7.2.2. A Bill of Sale for the Personalty from Seller,
substantially in the form of EXHIBIT C attached hereto, duly executed by Seller.
7.2.3. An Assignment and Assumption of Leases from Seller,
substantially in the form of EXHIBIT D attached hereto, duly executed by Seller.
7.2.4. An Assignment of Warranties and Permits from Seller,
substantially in the form of EXHIBIT E attached hereto, duly executed by Seller.
7.2.5. An Assignment and Assumption of Contracts (the "ASSIGNED
CONTRACTS") executed by Seller substantially in the form of EXHIBIT F attached
hereto, duly executed by Seller, assigning those contracts and agreements listed
on EXHIBIT A-3.
7.2.6. Originals or copies certified by Seller of the leases
(together with any amendments) for the Property, all contracts and other
material records and materials identified in the Exhibits hereto in effect at
the time of Closing, and all other material books, records and files maintained
by Seller's property manager relating to the construction, leasing, operation
and maintenance of the Property.
7.2.7. A notice to each tenant, executed by Seller, advising of
the sale of the Property and directing that rent and other payments thereafter
be sent to Buyer at the address provided by Buyer at Closing.
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7.2.8. Such affidavits or letters of indemnity as the Buyer's
title insurer shall reasonably require in order to issue, without extra charge,
an owner's policy of title insurance free of any exceptions for unfiled
mechanics' or materialmen's liens for work performed by Seller prior to Closing,
or for rights of parties in possession other than pursuant to the leases for the
apartments on the Property.
7.2.9. A Non-Foreign Affidavit as required by the Foreign
Investors in Real Property Tax Act ("FIRPTA"), as amended, in the form of
EXHIBIT G, duly executed by Seller.
7.2.10. A certification by Seller that all representations and
warranties made by Seller in ARTICLE 3 of this Agreement are true and correct in
all material respects on the date of Closing, except as may be set forth in such
certificate.
7.2.11. Certificates of legal existence and good standing of
Seller and its general partner(s) from the Massachusetts Secretary of State.
Duly certified resolutions from the Board of Directors of Seller's general
partner evidencing approval of and authorization to execute this Agreement and
the closing documents, and to consummate the transactions contemplated hereby.
7.2.12. All other instruments and documents reasonably required
to effectuate this Agreement and the transactions contemplated hereby,
including, without limitation, a closing statement describing the sources and
uses of funds in connection with the Closing.
7.3. BUYER DELIVERIES. At Closing, Buyer shall deliver to Seller the
following, and it shall be a condition to Seller's obligation to close that
Buyer shall have delivered the same to Seller:
7.3.1. In accordance with Seller's instructions, a wire
transfer in the amount required under SECTION 2.2 hereof (subject to the
adjustments provided for in this Agreement), transferred to the order or account
of Escrow Agent or to such other person or persons as Seller shall designate in
writing.
7.3.2. A certification by Buyer that all representations and
warranties made by Buyer in ARTICLE 16 of this Agreement are true and correct in
all material respects on the date of Closing, except as may be set forth in such
certificate.
7.3.3. The Bill of Sale referred to in SECTION 7.2, duly
executed and acknowledged by Buyer.
7.3.4. The Assignment and Assumption of Leases referred to in
SECTION 7.2, duly executed and acknowledged by Buyer.
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7.3.5. The Assignment of Warranties and Permits referred to in
SECTION 7.2, duly executed and acknowledged by Buyer.
7.3.6. The Assignment and Assumption of Contracts referred to
in SECTION 7.2.5, duly executed and acknowledged by Buyer.
7.3.7. Certificates of legal existence and good standing of
Buyer and its general partner(s) from the Massachusetts Secretary of State,
together with certified votes authorizing the execution of this Agreement and
the closing documents, and to consummate the transactions contemplated hereby.
7.3.8. All other instruments and documents reasonably required
to effectuate this Agreement and the transactions contemplated hereby,
including, without limitation, a closing statement describing the sources and
uses of funds in connection with the Closing.
8. APPORTIONMENTS; TAXES; EXPENSES.
8.1. APPORTIONMENTS.
8.1.1. TAXES AND OPERATING EXPENSES. All real estate taxes,
public and private charges and public and private assessments affecting the
Property ("Taxes"), and all expenses attributable to the operation of the
Property ("OPERATING EXPENSES"), to the extent not paid directly to the provider
of such services by tenants, shall be prorated on a per diem basis as of the
date of Closing, with such Taxes and Operating Expenses for the day of the
Closing allocated to the Buyer. If any Taxes have not been finally assessed as
of the date of Closing for the current fiscal year of the taxing authority, then
the same shall be adjusted at Closing based upon the most recently issued bills
therefor, and shall be readjusted when and if final bills are issued. If any
Operating Expenses cannot conclusively be determined as of the date of Closing,
then the same shall be adjusted at Closing based upon the most recently issued
bills thus far and shall be re-adjusted within one hundred twenty (120) days
after the end of the calendar year in which the Closing occurs after final
Operating Expenses are determined. Buyer hereby agrees to assume all
non-delinquent assessments affecting the Property, whether special or general
except that Seller shall be responsible for those payments due and owing prior
to Closing. Water and sewer charges are to be adjusted for as of the date of
Closing.
8.1.2. RENT. Except for delinquent rent (including delinquent
Operating Expenses), all rent under the leases for the Property shall be
prorated to the date of Closing, with rent for the day of the Closing allocated
to the Buyer. Delinquent rent shall not be prorated but shall remain the
property of Seller. Payments received from tenants from and after the date of
Closing shall be applied first to rents then due for the current period, second
to Buyer's expenses incurred in obtaining such amounts, and then to rents
delinquent as of the date of Closing. Buyer shall cooperate with Seller in the
collection of any delinquent amounts provided that such cooperation shall not
require Buyer to expend any money. Buyer shall be credited at Closing for any
security deposit or advance rental payment deposited with Seller pursuant to the
leases.
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8.1.3. CHARGES UNDER ASSIGNED CONTRACTS. The unpaid monetary
obligations of Seller with respect to any of the Assigned Contracts shall be
prorated on a per diem basis as of the date of Closing, with such obligations
for the day of the Closing allocated to Buyer.
8.2. EXPENSES. Each party will pay all its own expenses
incurred in connection with this Agreement and the transactions contemplated
hereby, including, without limitation, (1) all costs and expenses stated herein
to be borne by a party, and (2) all of their respective accounting, legal and
appraisal fees. Buyer, in addition to its other expenses, shall pay at Closing
(1) all recording charges incident to the recording of the Deed for the Real
Property, (2) premiums for any coverage under Buyer's title insurance policy,
(3) survey costs, and (4) one-half of the fees, costs and expenses of Escrow
Agent and the costs of any taxes assessed thereon. Seller, in addition to its
other expenses, shall pay at Closing (1) all documentary stamps, deed stamps and
realty transfer taxes, and (2) one-half of the fees, costs and expenses of
Escrow Agent and the costs of any taxes assessed thereon.
9. DAMAGE OR DESTRUCTION; CONDEMNATION; INSURANCE.
If at any time prior to the date of Closing there is damage or
destruction to the Property the cost for repair of which exceeds $375,000, or if
all or any material portion of the Property is condemned or taken by eminent
domain proceedings by any public authority, then, at Buyer's option, this
Agreement shall terminate, and the Deposit, together with any interest accrued
thereon, shall be returned to Buyer, and except as expressly set forth herein,
neither party shall have any further liability or obligation to the other
hereunder.
If there is any damage or destruction or condemnation or taking, as
above set forth, and if Buyer elects not to terminate this Agreement as herein
provided, then (1) in the case of a taking, all condemnation proceeds paid or
payable to Seller shall belong to Buyer and shall be paid over and assigned to
Buyer at Closing; and (2) in the case of a casualty, Seller shall assign to
Buyer all rights to any insurance proceeds paid or payable under the applicable
insurance policies and shall credit to Buyer at Closing an amount equal to any
deductible in connection therewith, less any costs of collection and any sums
expended in restoration.
Until the time of Closing, Seller shall maintain existing policies of
insurance relating to the Property in full force and effect.
10. REMEDIES.
10.1. BUYER DEFAULT. In the event Buyer breaches or fails, without
legal excuse, to complete the purchase of the Property or to perform its
obligations under this Agreement, then Seller shall, as its sole remedy
therefor, be entitled to receive the Deposit, plus all interest earned and
accrued thereon, as liquidated damages (and not as a penalty) in lieu of, and as
full compensation for, all other rights or claims of Seller against Buyer by
reason of such default. Thereupon this Agreement shall terminate and the parties
shall be relieved of all further obligations and liabilities hereunder, except
as expressly set forth herein. Buyer and Seller
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acknowledge that the damages to Seller resulting from Buyer's breach would be
difficult, if not impossible, to ascertain with any accuracy, and that the
liquidated damage amount set forth in this Section represents the parties' best
efforts to approximate such potential damages.
10.2. SELLER DEFAULT. In the event Seller breaches or fails, without
legal excuse, to complete the sale of the Property or to perform its obligations
under this Agreement, Buyer may, as its sole remedy therefor subject to the next
paragraph of this SECTION 10.2, either (i) enforce specific performance of this
Agreement against Seller, or (ii) terminate this Agreement and receive the
Deposit, plus all interest earned and accrued thereon, except that in the case
of any breach of a representation, warranty or covenant of a Seller which
survives the closing, if Buyer closes, Buyer shall be entitled, as its sole
remedy, to recover its actual damages therefor.
Notwithstanding anything to the contrary contained in this Agreement,
Buyer agrees that its recourse against Seller under this Agreement or under any
other agreement, document, certificate or instrument delivered by Seller to
Buyer, or under any law applicable to the Property or this transaction, shall be
strictly limited to Seller's interest in the Property (or upon consummation of
the transaction contemplated hereunder, to $1,000,000), and that in no event
shall Buyer seek or obtain any recovery or judgment against any of Seller's
other assets (if any) or against any of Seller's beneficiaries, partners (or
their constituent partners) or any director, officer, employee or shareholder of
any of the foregoing, except to the extent that the proceeds of the sale of the
property (up to the aggregate maximum amount of $1,000,000) were actually
distributed to such beneficiaries, partners, or directors, officers, employees
or shareholders.
11. CONFIDENTIALITY. Buyer agrees to keep confidential and not to use,
other than in connection with its determination whether to proceed with the
purchase of the Property in accordance with SECTION 4.4 hereof, any of the
documents, material or information regarding the Property supplied to Buyer by
Seller or by any third party at Seller's request, including, without limitation
any environmental site assessment reports furnished to Buyer except to Buyer's
consultants on a "need to know" basis, unless Buyer is compelled to disclose
such documents, material or information by law or by subpoena. Buyer agrees to
indemnify and hold harmless Seller from and against any and all losses, damages,
claims and liabilities of any kind (including, without limitation, reasonable
attorneys' fees) arising out of Buyer's breach of this SECTION 11. In the event
that the Closing does not occur in accordance with the terms of this Agreement,
Buyer shall return to Seller all of the documents, material or information
regarding the Property supplied to Buyer by Seller or at the request of Seller.
The provisions of this SECTION 11 shall survive the termination of this
Agreement.
12. POSSESSION. Possession of the Property and all of Seller's keys to
the Property (including without limitation, all buildings, apartments,
storerooms, and offices) shall be surrendered to Buyer at Closing, subject to
the rights of the tenants under the leases.
13. NOTICES. All notices and other communications provided for herein
shall be in writing and shall be sent to the address set forth below (or such
other address as a party may hereafter designate for itself by notice to the
other parties as required hereby) of the party for whom such notice or
communication is intended:
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13.1. IF TO SELLER:
SNE Products, Inc.
600 Plain Street
Marshfield, MA 02050
Attention: Paul Townsend
With a copy to:
Brown, Rudnick, Freed & Gesmer, P.C.
One Financial Center
Boston, Massachusetts 02111
Fax No.: 617-856-8201
Attention: Daniel D. Sullivan, Esquire
Franz T. Litz, Esquire
13.2. IF TO BUYER:
New England Realty Advisors
39 Brighton Avenue
Boston, Massachusetts 02135
Fax No.: (617)
Attention: Harold Brown
With a copy to:
Linda Vaccaro, General Counsel
The Hamilton Company
39 Brighton Avenue
Allston, Massachusetts 02134
Fax No.: (617) 783-0568
13.3. If to the Escrow Agent to:
Commonwealth Title Insurance Company
50 Federal Street
Boston, Massachusetts 02110
Fax No.: (617) 542-0636
Attention: Haskell Shapiro
Any such notice or communication shall be sufficient if sent by registered or
certified mail, return receipt requested, postage prepaid; by hand delivery; by
overnight courier service; or by telecopy, with an original by regular mail. Any
such notice or communication shall be effective when delivered or when delivery
is refused.
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14. BROKERS. Buyer and Seller each represent to the other that it has
not dealt with any broker or agent in connection with this transaction other
than Allen/Dushman Associates Investment Real Estate, LP ("BROKER"). Seller
shall pay Broker a commission pursuant to a separate agreement, if, as and when
the Closing occurs, but not otherwise. Each party hereby indemnifies and holds
harmless the other party from all loss, cost and expense (including reasonable
attorneys' fees) arising out of a breach of its representation or undertaking
set forth in this SECTION 14. The provisions of this SECTION 14 shall survive
Closing or the termination of this Agreement.
15. ESCROW AGENT Escrow Agent shall hold the Deposit in accordance with
the terms and provisions of this Agreement and in accordance with the terms and
provisions of the Supplemental Escrow Instructions attached hereto as EXHIBIT I
(the "SUPPLEMENTAL INSTRUCTIONS"), subject to the following:
15.1. OBLIGATIONS. Escrow Agent undertakes to perform only such
duties as are expressly set forth in this Agreement and the Supplemental
Instructions and no implied duties or obligations shall be read into this
Agreement against Escrow Agent.
15.2. RELIANCE. Escrow Agent may act in reliance upon any writing or
instrument or signature which it, in good faith, believes to be genuine, and any
statement or assertion contained in such writing or instrument, and may assume
that any person purporting to give any writing, notice, advice or instrument in
connection with the provisions of this Agreement has been duly authorized to do
so. Escrow Agent shall not be liable in any manner for the sufficiency or
correctness as to form, manner and execution, or validity of any instrument
deposited in escrow, nor as to the identity, authority, or right of any person
executing the same, and Escrow Agent's duties under this Agreement shall be
limited to those provided in this Agreement.
15.3. INDEMNIFICATION. Unless Escrow Agent discharges any of its
duties under this Agreement in a negligent manner or is guilty of willful
misconduct with regard to its duties under this Agreement, Seller and Buyer
shall indemnify Escrow Agent and hold it harmless from any and all claims,
liabilities, losses, actions, suits or proceedings at law or in equity, or other
expenses, fees, or charges of any character or nature, which it may incur or
with which it may be threatened by reason of its acting as Escrow Agent under
this Agreement; and in such connection Seller and Buyer shall indemnify Escrow
Agent against any and all expenses including reasonable attorneys' fees and the
cost of defending any action, suit or proceeding or resisting any claim in such
capacity.
15.4. DISPUTES. If the parties (including Escrow Agent) shall be in
disagreement about the interpretation of this Agreement, or about their
respective rights and obligations, or the propriety of any action contemplated
by Escrow Agent, or the application of the Deposit, Escrow Agent shall hold the
Deposit until the receipt of (i) written instructions from both Buyer and Seller
or (ii) a final order of a court of competent jurisdiction. Escrow Agent may,
but shall not be required to, file an action in interpleader to resolve the
disagreement. Escrow Agent shall be
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indemnified for all costs and reasonable attorneys' fees in its capacity as
Escrow Agent in connection with any such interpleader action and shall be fully
protected in suspending all or part of its activities under this Agreement until
a final judgment in the interpleader action is received.
15.5. COUNSEL. Escrow Agent may consult with counsel of its own
choice and have full and complete authorization and protection in accordance
with the opinion of such counsel. Escrow Agent shall otherwise not be liable for
any mistakes of fact or errors of judgment, or for any acts or omissions of any
kind, unless caused by its negligence or willful misconduct.
15.6. INTEREST. All deposits into the escrow shall be held by the
Escrow Agent in an interest bearing account. All interest earned on the Deposit
shall be deemed to be part of the Deposit and shall accrue to the benefit of
Buyer except to the extent the Deposit becomes payable to Seller pursuant to
SECTION 10.1. In such event the interest earned on the Deposit shall accrue to
the benefit of the Seller.
16. REPRESENTATIONS OF BUYER. Buyer represents and warrants that:
16.1. AUTHORITY. Buyer is a limited partnership, duly organized,
validly existing and in good standing under the laws of Massachusetts and has
all requisite power and authority to enter into this Agreement and to perform
its obligations hereunder. The execution and delivery of this Agreement by Buyer
has been duly authorized.
16.2. NO CONFLICT. The execution and delivery of this Agreement and
the consummation of the transactions contemplated hereunder on the part of Buyer
does not and will not violate any applicable law, ordinance, statute, rule,
regulation, order, decree or judgment, conflict with or result in the breach of
any material terms or provisions of, or constitute a default under, or result in
the creation or imposition of any lien, charge, or encumbrance upon any of the
property or assets of the Buyer by reason of the terms of any contract,
mortgage, lien, lease, agreement, indenture, instrument or judgment to which
Buyer is a party or which is or purports to be binding upon Buyer or which
otherwise affects Buyer, which will not be discharged or released at or prior to
Closing. No action by any federal, state or municipal or other governmental
department, commission, board, bureau or instrumentality is necessary to make
this Agreement a valid instrument binding upon Buyer in accordance with its
terms.
16.3. SOURCE OF FUNDS. Buyer has available to it unrestricted funds
which it may use in its sole discretion to pay the cash portion of the Purchase
Price and otherwise comply with the provisions of this Agreement.
17. MISCELLANEOUS.
17.1. ASSIGNABILITY. Buyer may not assign or transfer all or any
portion of its rights or obligations under this Agreement to any other
individual, entity or other person without the consent thereto by Seller, which
consent may be withheld in Seller's sole and absolute
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discretion, except that as to parties related to Purchaser, Seller's consent may
not be unreasonably withheld.
17.2. GOVERNING LAW; BIND AND INURE. This Agreement shall be
governed by the law of the Commonwealth of Massachusetts and shall bind and
inure to the benefit of the parties hereto and their respective heirs,
executors, administrators, successors, assigns and personal representatives.
17.3. RECORDING. This Agreement or any notice or memorandum hereof
shall not be recorded in any public record. A violation of this prohibition
shall constitute a material breach of Buyer, entitling Seller to terminate this
Agreement.
17.4. TIME OF THE ESSENCE. Time is of the essence of this Agreement.
17.5. HEADINGS. The headings preceding the text of the paragraphs
and subparagraphs hereof are inserted solely for convenience of reference and
shall not constitute a part of this Agreement, nor shall they affect its
meaning, construction, or effect.
17.6. COUNTERPARTS. This Agreement may be executed simultaneously in
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
17.7. EXHIBITS. All Exhibits which are referred to herein and which
are attached hereto or bound separately and initialed by the parties are
expressly made and constitute a part of this Agreement.
17.8. SURVIVAL. Unless otherwise expressly stated in this Agreement,
each of the warranties and representations of Seller and Buyer shall survive the
Closing and delivery of the Deed and other closing documents by Seller to Buyer,
and shall not be deemed to have merged therewith; provided, however, that any
suit or action for breach of any of the representations or warranties set forth
herein must be commenced within one (1) year after the Closing, or any claim
based thereon shall be deemed irrevocably waived. Unless expressly made to
survive, all obligations and covenants of Seller contained herein shall be
deemed to have been merged into the Deed and shall not survive the Closing.
17.9. USE OF PROCEEDS TO CLEAR TITLE. To enable Seller to make
conveyance as herein provided, Seller may, at the time of Closing, use the
Purchase Price or any portion thereof to clear the title of any or all
encumbrances or interests, provided that provision reasonably satisfactory to
Buyer's attorney is made for prompt recording of all instruments so procured in
accordance with conveyancing practice in the jurisdiction in which the Property
is located.
17.10. SUBMISSION NOT AN OFFER OR OPTION. The submission of this
Agreement or a summary of some or all of its provisions for examination or
negotiation by Buyer or Seller does not constitute an offer by Seller or Buyer
to enter into an agreement to sell or purchase the
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Property, and neither party shall be bound to the other with respect to any such
purchase and sale until a definitive agreement satisfactory to the Buyer and
Seller in their sole discretion is executed and delivered by both Seller and
Buyer.
17.11. ENTIRE AGREEMENT; AMENDMENTS. This Agreement and the Exhibits
hereto set forth all of the promises, covenants, agreements, conditions and
undertakings between the parties hereto with respect to the subject matter
hereof, and supersede all prior and contemporaneous agreements and
understandings, inducements or conditions, express or implied, oral or written,
except as contained herein. This Agreement may not be changed orally but only by
an agreement in writing, duly executed by or on behalf of the party or parties
against whom enforcement of any waiver, change, modification, consent or
discharge is sought.
17.12. MONTHLY OPERATING REPORTS. Seller agrees to provide Buyer
with copies of the monthly operating expenses for the Property through the date
of Closing.
17.13 NO MARKETING. Seller agrees that while this Agreement
remains in effect Seller shall neither market the Property to nor solicit
offers from any person other than Buyer.
[SIGNATURES APPEAR ON THE NEXT PAGE]
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IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement as of the date first above written.
SELLER:
WCA LIMITED PARTNERSHIP
By: James-Town Properties II, Inc.
its general partner,
By: __________________________
Name:
Title:
BUYER:
NEW ENGLAND REALTY ASSOCIATES
By: NewReal, Inc., its general partner
By: /s/ Ronald Brown
---------------------------
Ronald Brown, Its President
By: /s/ Ronald Brown
---------------------------
Harold Brown, Its Treasurer
ESCROW AGENT:
COMMONWEALTH TITLE INSURANCE COMPANY
By: __________________________
Name: ____________________
Title: ___________________
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EXHIBIT A
DESCRIPTION OF LAND
Five certain parcels of land with the Buildings and improvements thereto
belonging, situated in Brockton, Plymouth County, Massachusetts, and being shown
as Lots 1, 2, 3, 4 and a Lot entitled "Advent Christian Church" on a plan
entitled "Plan of Land in Brockton belonging to Thomas J. Flatley", dated
November 14, 1961 made by Hayward-Hayward & Boynton, Engineers and Surveyors,
duly recorded with Plymouth County Registry of Deeds as Plan 821 of 1961. Said
five parcels of land are together more particularly bounded and described as
follows:
SOUTHWESTERLY by Pleasant Street, as shown on said plan,
in four courses measuring, respectively, one
hundred twenty-one and 80/100 (121.80) feet,
fifty-five and 50/100 (55.50) feet, one
hundred twenty-four and 40/100 (124.40)
feet, and one hundred thirty-seven and
43/100 (137.43) feet;
NORTHWESTERLY by Amvets Memorial Highway, Commonwealth of
Massachusetts (Route #24) in three courses
measuring respectively, one hundred
forty-four and 62/100 (144.62) feet, three
hundred eighty and 57/100 (380.57) feet, and
five hundred thirty-two and 47/100 (532.47)
feet;
NORTHERLY by said last mentioned Highway fifty and
32/100 (50.32) feet;
EASTERLY by land of the City of Brockton, as shown on
said plan, one hundred fourteen and 33/100
(114.33) feet;
SOUTHERLY by Alandale Avenue, as shown on said plan,
thirty and 23/100 (30.23) feet;
EASTERLY again by Westland Street, as shown on said
plan, in three courses measuring
respectively, four hundred forty-five
(445.00) feet, three hundred twenty (320.00)
feet and three hundred twenty-six and 53/100
(326.53) feet;
SOUTHEASTERLY in a curved line forming the junction of
Westland Street and Pleasant Street, as
shown on said plan, twenty-five and 20/100
(25.20) feet.
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There is appurtenant to said premises the right to use so much of Westland
Street, in common with others entitled thereto for all purposes for which street
and ways are commonly used in the City of Brockton, as shown on said plan, lying
northerly of that portion of said street laid out by the City of Brockton by
instrument duly recorded with said Deeds, Book 3336, Page 330, which portion of
Westland Street is shown as private way on the title insurance plan reference in
Schedule B.
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EXHIBIT A-1
PERMITTED ENCUMBRANCES
1. Liens for real estate taxes and municipal assessments not yet due and
payable.
2. Rights of tenants in possession, as tenants only, under unrecorded
residential leases.
3. Taking by the Commonwealth of Massachusetts for the relocation of Amvets
Memorial Highway dated January 19, 1954 and recorded in Book 2324, Page 171.
4. Taking by the Commonwealth of Massachusetts for the relocation of Amvets
Memorial Highway dated May 11, 1954 and recorded in Book 2344, Page 173.
5. Taking by the City of Brockton for sewer purposes dated August 22, 1960 and
recorded in Book 2798, Page 127.
6. Taking by the City of Brockton for sewer purposes dated November 14, 1966
and recorded in Book 3336, Page 330.
7. Rights of others in and Amvets Memorial Highway, Westland Street, Pleasant
Street and Alandale Avenue.
8. Matters shown on a plan of land entitled "Title Insurance Plan of Land in
Brockton, Massachusetts" prepared for Westside Colonial Limited Partnership
by Hayward-Boynton & Williams, Inc., dated September 15, 1993, Rev. January
20, 1995, Rev. through August 28, 1998, Scale 1"=40'.
9. Notice of Lease between Mac-Gray Co., Inc. and WCA Limited Partnership
recorded in October 19, 1995 in Book 13903, Page 347, as affected by
Subordination, Non-Disturbance and Attornment dated a of September 30, 1998,
recorded in Book ___, Page ___.
10. UCC-1 Financing Statement naming WCA Limited Partnership, as Debtor and
Berkshire Mortgage Finance Corporation, as Secured Party recorded in Book
16656, Page 191.
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11. Mortgage, Assignment of Leases and Rents and Security Agreement from WCA
Limited Partnership to Berkshire Mortgage Finance Corporation dated
September 30, 1998, in the original principal amount of $5,265,000.00,
recorded September 30, 1998, in Book 16656, Page 191.
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EXHIBIT A-2
RENT ROLL
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EXHIBIT A-3
SERVICE CONTRACTS
1. Browning-Ferris Industries, Inc. for trash removal.
2. Mac-Gray Services, Inc. for laundry services.
3. Boston Gas for boilers (payment of $1,652 per month on remaining balance of
approximately $6,600).
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EXHIBIT B
FORM OF DEED
QUITCLAIM DEED
Westside Colonial Village Apartments, 18 Westland Avenue, Brockton,
Massachusetts
WCA Limited Partnership, a Massachusetts limited partnership with an
address of 169 Beach Avenue, Hull, Massachusetts 02045 ("GRANTOR"), for
consideration paid, and in full consideration of Eight Million Nine Hundred
Thousand and No/100 Dollars ($8,900,000.00), grants to New England Realty
Associates, a limited partnership organized under the laws of
__________________, having a mailing address at 39 Brighton Avenue, Boston,
Massachusetts 02135 ("GRANTEE"), with QUITCLAIM COVENANTS, those certain parcels
of land, together with the improvements thereon, known as Westside Colonial
Village Apartments, located at 18 Westland Avenue, Brockton, Massachusetts,
bounded and described as follows:
[Insert legal description]
The above-described premises also are conveyed subject to and with the
benefit of all agreements and restrictions of record.
For Grantor's title see the deed dated __________, from _____________
to Grantor recorded with the Middlesex South Registry of Deeds in Book
___________, Page ______.
EXECUTED under seal this _______ day of ____________, 1999.
WCA LIMITED PARTNERSHIP
By: James-Town Properties II, Inc., its
General Partner
By: _______________________________
Name:
Title:
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Commonwealth of Massachusetts
, ss. _____________, 1999
Then personally appeared the above-named __________________ , as
_______________________ of James-Town Properties II, Inc., the General Partner
of WCA Limited Partnership and acknowledged the foregoing instrument to be the
free act and deed of said corporation as General Partner aforesaid, before me,
--------------------
Notary Public
My Commission Expires:
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EXHIBIT C
BILL OF SALE
WCA Limited Partnership, a Massachusetts limited partnership with an
address of 169 Beach Avenue, Hull, Massachusetts 02045 ("SELLER"), for good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, hereby grants, bargains, sells, transfers and delivers to New
England Realty Associates, a limited partnership organized under the laws of
_____________ ("BUYER"), all of the fixtures, equipment and personal property
located on and used in connection with the real property described on EXHIBIT A
(the "REAL PROPERTY") attached hereto, including, if any, all blinds, window
shades, screens, screen doors, storm windows and doors, awnings, shutters,
furnaces, heaters, heating equipment, stoves, ranges, oil and gas burners and
fixtures appurtenant thereto, hot water heaters, plumbing and bathroom fixtures,
electric and other lighting fixtures, trees, shrubs, plants, and air
conditioning equipment and ventilators, (collectively, the "PERSONAL PROPERTY"),
but specifically excluding from the Personal Property (i) all property leased by
Seller or owned by tenants or others, if any, and (ii) all names and/or trade
names used in connection with the Real Property, including, without limitation,
"Cabot, Cabot & Forbes" and "CC&F," to have and to hold the Personal Property
unto Buyer, its successors and assigns, forever.
Seller hereby represents and warrants to Buyer that Seller has the full
right, power and authority to sell the Personal Property and to make and execute
this Bill of Sale. Except as set forth above and in the Purchase and Sale
Agreement by and between Seller and Buyer dated as of September ____, 1999 (the
"PURCHASE AGREEMENT"), Seller grants, bargains, sells, transfers and delivers
the Personal Property in its "AS IS" condition, WITH ALL FAULTS, IF ANY, and
makes no representations or warranties, direct or indirect, oral or written,
express or implied, as to title, encumbrances and liens, merchantability,
condition or fitness for a particular purpose or any other warranty of any kind,
all of which representations and warranties are expressly hereby disclaimed and
denied.
Buyer agrees that the liability of Seller under this Bill of Sale, the
Purchase Agreement, and any other agreement, document, certificate or instrument
delivered by Seller to Buyer, or under any law applicable to the Property or
this transaction, shall be limited as provided in the Purchase Agreement.
Capitalized terms used and not otherwise defined herein shall have the
meanings given to such terms in the Purchase Agreement.
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<PAGE>
Executed under seal this _____ day of ____, 1999.
SELLER:
WCA LIMITED PARTNERSHIP
By: James-Town Properties II, Inc.,
its General Partner
By: ______________________________
Name:
Title:
ACKNOWLEDGMENT OF BUYER
The Buyer hereby accepts the Personal Property subject to all
conditions and limitations stated above.
BUYER:
NEW ENGLAND REALTY ASSOCIATES
By: ___________________________________
Name: ________________________________
Title: ________________________________
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EXHIBIT D
ASSIGNMENT AND ASSUMPTION OF LEASES
DATE: October, 1999
ASSIGNOR: WCA Limited Partnership, a Massachusetts limited
partnership
ASSIGNEE: New England Realty Associates, a limited partnership
organized under the laws of
---------------------
RECITALS:
WHEREAS, Assignor and Assignee have entered into that certain Purchase
and Sale Agreement dated as of September ___, 1999 (the "PURCHASE Agreement"),
wherein Assignor agreed to sell and Assignee agreed to buy that certain real
property described on Exhibit "A" attached hereto and the improvements located
thereon (the "PROPERTY");
WHEREAS, Assignee desires to assume and Assignor desires to assign to
Assignee the lease currently existing on the Property, which lease is more
particularly described on EXHIBIT "B" attached hereto and incorporated herein by
this reference (the "LEASE").
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Assignor and Assignee agree as
follows:
1. ASSIGNMENT. Assignor conveys and assigns to Assignee all of Assignor's
right, title and interest in and to the Lease, and all security
deposits and advance payments thereunder, together with the right to
receive any and all sums and proceeds arising out of said leases, from
and after the date of conveyance of the Property by Assignor to
Assignee (the "CONVEYANCE DATE"), but reserving unto Assignor all
uncollected rent attributable to the period prior to the Closing Date
pursuant to the provisions of SECTION 8.1.2 of the Purchase Agreement.
2. ASSUMPTION. Buyer hereby accepts the within assignment and agrees with
Seller to perform and comply with and to be bound by all of the terms,
covenants, agreements, provisions and conditions of the Lease on the
part of the Lessee thereunder to be performed after the Conveyance
Date.
3. INDEMNIFICATION. Assignee further covenants and agrees to indemnify and
hold harmless Assignor for, from and against any actions, suits,
proceedings or claims, and all costs and expenses, including, without
limitation, reasonable attorneys' fees, incurred in connection
therewith, based upon or arising out of any breach or alleged breach of
the Lease or out of
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any other facts connected with the Lease, occurring or alleged to have
occurred from and after the Conveyance Date. Assignor covenants and
agrees to indemnify and hold harmless Assignee for, from and against
any actions, suits, proceedings or claims, and all costs and expenses,
including, without limitation, reasonable attorneys' fees, incurred in
connection therewith, based upon or arising out of any breach or
alleged breach of the Lease or out of any other facts connected with
the Lease, occurring or alleged to have occurred before the Conveyance
Date.
4. BINDING EFFECT. This Assignment shall inure to the benefit of and shall
be binding upon the parties hereto and their respective successors and
assigns.
5. CONSTRUCTION; DEFINITIONS. This Assignment shall be construed according
to Massachusetts law. Capitalized terms used and not otherwise defined
herein shall have the meanings given to such terms in the Purchase
Agreement.
6. COUNTERPARTS. This Assignment may be executed in counterparts, which
taken together shall constitute one original instrument.
7. NON-RECOURSE. Assignee agrees that the liability of Assignor under this
Assignment, the Purchase Agreement, and any other agreement, document,
certificate or instrument executed in connection with the transaction
contemplated herein, or under any law applicable to the Property or
this transaction, shall be limited as provided in SECTION 10.2 of the
Purchase Agreement.
Executed under seal this ____ day of _______, 1999.
SELLER:
WCA LIMITED PARTNERSHIP
By: James-Town Properties II, Inc.,
its General Partner
By: _______________________________
Name:
Title:
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<PAGE>
ACKNOWLEDGMENT OF BUYER
The Buyer hereby accepts the Personal Property subject to all
conditions and limitations stated above.
BUYER:
NEW ENGLAND REALTY ASSOCIATES
By: ___________________________________
Name: _________________________________
Title: ________________________________
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EXHIBIT E
ASSIGNMENT OF WARRANTIES AND PERMITS
DATE: ______________________, 1999
ASSIGNOR: WCA Limited Partnership, a Massachusetts limited
partnership
ASSIGNEE: New England Realty Associates, Inc. a limited
partnership organized under the laws of ----------------
RECITALS:
A. Assignor presently owns the real property described in EXHIBIT "A"
to this Assignment and the improvements and personal property located thereon
(the "PROPERTY").
B. WHEREAS, Assignor and Assignee have entered into that certain
Purchase and Sale Agreement dated as of September __, 1999 (the "PURCHASE
AGREEMENT"), wherein Assignor agreed to sell and Assignee agreed to buy the
Property;
C. Assignor desires to sell the Property to Assignee, and in connection
therewith, Assignor desires to assign to Assignee and Assignee desires to
acquire Assignor's interest, if any, in and to the following described rights,
interests and property inuring to the benefit of Assignor and relating to the
Property.
FOR VALUABLE CONSIDERATION, the receipt and adequacy of which are
hereby acknowledged, Assignor agrees as follows:
1. ASSIGNMENT. Assignor assigns, transfers, sets over, and conveys to
Assignee, to the extent the same are assignable, all of Assignor's
right, title, and interest, if any, in and to (i) any warranties and/or
guaranties, express or implied, from contractors, builders,
manufacturers, and/or suppliers inuring to the benefit of Assignor and
relating to the Property, (ii) any licenses or permits relating to the
Property.
2. BINDING EFFECT. This Assignment shall inure to the benefit of and be
binding upon the parties hereto and their respective successors and
assigns.
3. CONSTRUCTION; DEFINITIONS. This Assignment shall be construed according
to Massachusetts law. Capitalized terms used and not otherwise defined
herein shall have the meanings given to such terms in the Purchase
Agreement.
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<PAGE>
4. NON-RECOURSE. Assignee agrees that the liability of Assignor under this
Assignment, the Purchase Agreement, and any other agreement, document,
certificate or instrument delivered by Seller to Buyer, or under any
law applicable to the Property or this transaction, shall be limited as
provided in SECTION 10.2 of the Purchase Agreement.
DATED as of the day and year first above written.
ASSIGNOR:
WCA LIMITED PARTNERSHIP
By: James-Town Properties II, Inc.,
its General Partner
By: ______________________________
Name:
Title:
ASSIGNEE:
NEW ENGLAND REALTY ASSOCIATES, INC.
By: ___________________________________
Name: _____________________________
Title: ____________________________
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EXHIBIT F
ASSIGNMENT AND ASSUMPTION OF CONTRACTS
DATE: ____________________, 1999
ASSIGNOR: WCA Limited Partnership, a Massachusetts limited
partnership
ASSIGNEE: New England Realty Associates, a limited partnership
organized under the laws of _____________________
RECITALS:
WHEREAS, Assignor and Assignee have entered into that certain Purchase
and Sale Agreement dated as of September ___, 1999 (the "PURCHASE AGREEMENT"),
wherein Assignor agreed to sell and Assignee agreed to buy that certain real
property described on EXHIBIT "A" attached hereto and the improvements located
thereon (the "PROPERTY");
WHEREAS, Assignee desires to assume and Assignor desires to assign to
Assignee all of Assignor's right, title and interest in and to all of the
contracts and agreements, and all modifications and amendments thereof, which
concern or relate to the use, operation, alteration or renovation of the
Property set forth on EXHIBIT "B" attached hereto (collectively, the
"CONTRACTS").
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Assignor and Assignee agree as
follows:
1. ASSIGNMENT. Assignor conveys and assigns to Assignee all of Assignor's
right, title and interest in and to the Contracts and claims and causes
of action now existing under the same as of the date of conveyance of
the Property by Assignor to Assignee (the "CONVEYANCE DATE"), subject
to the covenants, conditions and provisions mentioned in such
Contracts.
2. ASSUMPTION. Assignee assumes and agrees to be bound by all of
Assignor's liabilities and obligations pursuant to the Contracts, if
any, and agrees to perform and observe all of the covenants and
conditions contained in the Contracts, from and after the Conveyance
Date.
3. INDEMNIFICATION. Assignee further covenants and agrees to indemnify and
hold harmless Assignor for, from and against any actions, suits,
proceedings or claims, and all costs and expenses, including, without
limitation, reasonable attorneys' fees, incurred in connection
therewith, based upon or arising out of any breach or alleged breach of
any of the Contracts or out of any other facts connected with the
Contracts, occurring or alleged to
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<PAGE>
have occurred from and after the Conveyance Date. Assignor covenants
and agrees to indemnify and hold harmless Assignee for, from and
against any actions, suits, proceedings or claims, and all costs and
expenses, including, without limitation, reasonable attorneys' fees,
incurred in connection therewith, based upon or arising out of any
breach or alleged breach of any of the Contracts or out of any other
facts connected with the Contracts, occurring or alleged to have
occurred before the Conveyance Date.
4. BINDING EFFECT. This Assignment shall inure to the benefit of and shall
be binding upon the parties hereto and their respective successors and
assigns.
5. CONSTRUCTION; DEFINITIONS. This Assignment shall be construed according
to Massachusetts law. Capitalized terms used and not otherwise defined
herein shall have the meanings given to such terms in the Purchase
Agreement.
6. COUNTERPARTS. This Assignment may be executed in counterparts, which
taken together shall constitute one original instrument.
7. NON-RECOURSE. Assignee agrees that the liability of Assignor under this
Assignment, the Purchase Agreement, and any other agreement, document,
certificate or instrument executed in connection with the transaction
contemplated herein, or under any law applicable to the Property or
this transaction, shall be limited as provided in SECTION 10.2 of the
Purchase Agreement.
DATED as of the day and year first above written.
ASSIGNOR:
WCA LIMITED PARTNERSHIP
By: James-Town Properties II, Inc.,
its General Partner
By: ______________________________
Name:
Title:
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<PAGE>
ASSIGNEE:
NEW ENGLAND REALTY ASSOCIATES
By: ___________________________________
Name: _____________________________
Title: ____________________________
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<PAGE>
EXHIBIT G
NON-FOREIGN AFFIDAVIT
Section 1445 of the Internal Revenue Code provides that a transferee of
a U.S. real property interest must withhold tax if the transferor is a foreign
person. To inform the transferee that withholding of tax is not required upon
the disposition of a U.S. real property interest by WCA Limited Partnership, a
Massachusetts limited partnership ("SELLER"), the undersigned hereby certifies
the following:
1. Seller is not a foreign person, foreign corporation, foreign
partnership, foreign trust, or foreign estate (as those terms are
defined in the Internal Revenue Code and Income Tax Regulations);
2. Seller's U.S. taxpayer identification number is
__________________________; and
3. Seller's address is 169 Beach Avenue, Hull Massachusetts 02045.
The undersigned understands that this certification may be disclosed to
the Internal Revenue Service by the transferee and that any false statement
contained herein could be punished by fine, imprisonment, or both. Under
penalties of perjury, the undersigned declares that it has examined this
certification and to the best of its knowledge and belief it is true, correct,
and complete, and further declares that it has authority to sign this document.
Date: As of __________________, 1999
WCA LIMITED PARTNERSHIP
By: James-Town Properties II, Inc.,
its General Partner
By: _______________________________
Name:
Title:
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<PAGE>
EXHIBIT H
FUNDING AND ESCROW AGREEMENT
This Funding and Escrow Agreement is made as of this ________ day of
___, 1999, by and among WCA Limited Partnership, a Massachusetts limited
partnership with an address of 169 Beach Avenue, Hull, Massachusetts 02045
("SELLER") and New England Realty Associates, a limited partnership organized
under the laws of __________________________, with an address at 39 Brighton
Avenue, Boston, Massachusetts 02135 ("BUYER"), and ______________________ Title
Insurance Company, having an address of ____________________ ("ESCROW AGENT").
This Agreement is made in connection with the purchase and sale of
certain real property and the Buildings and other improvements thereon commonly
known and numbered as Westside Colonial Apartment, 18 Westland Avenue, Brockton,
Massachusetts, more particularly described in the "Title Insurance Policy," as
hereinafter defined, (the "PROPERTY"), pursuant to that certain Purchase and
Sale Agreement dated September ___, 1999 between Seller and Buyer (the "PURCHASE
AGREEMENT"). The parties hereto have entered into this Funding and Escrow
Agreement in order to facilitate the purchase and sale of the Property and the
payment of the purchase price in connection therewith. All capitalized terms
used and not otherwise defined herein shall have the meanings given to them in
the Purchase Agreement.
Annexed hereto are copies of the following documents as exhibits:
1. EXHIBIT A, consisting of an invoice of Escrow Agent to Buyer listing
Escrow Agent's title charges and wiring instructions of Escrow Agent
("ESCROW AGENT'S WIRING INSTRUCTIONS").
2. EXHIBIT B, consisting of the Owner's Policy of Title Insurance to be
issued by Escrow Agent to Buyer (the "OWNER'S TITLE INSURANCE POLICY").
3. EXHIBIT C, consisting of a list of the documents and instruments
executed by Seller, including deeds of the Property, delivered into
escrow with Escrow Agent (the "SELLER'S DOCUMENTS").
4. EXHIBIT D, consisting of a list of the documents and instruments
executed by Buyer, delivered into escrow with Escrow Agent (the "BUYER
DOCUMENTS").
5. EXHIBIT E, consisting of a Disbursement Schedule (the "DISBURSEMENT
SCHEDULE") for the "Closing Funds" (as hereinafter defined).
6. EXHIBIT F, consisting of wiring instructions of Seller ("SELLER'S
WIRING INSTRUCTIONS").
7. EXHIBIT G, consisting of wiring instructions of Buyer ("BUYER'S WIRING
INSTRUCTIONS").
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Upon Escrow Agent's receipt of (i) written notice from Seller's counsel
to proceed (a copy of which notice shall be sent to Buyer) and (ii) written
notice from Buyer's counsel to proceed (a copy of which notice shall be sent to
Seller), Buyer shall (a) wire to Escrow Agent, in accordance with Escrow Agent's
Wiring Instructions, to be held in escrow in accordance with the provisions of
this Agreement, $_________ ("CLOSING FUNDS"), which amount represents the sum of
the net purchase price for the Premises of $___________ (the "NET PURCHASE
PRICE"), plus the title charges of Escrow Agent set forth on EXHIBIT B which are
Buyer's responsibility (the "BUYER'S TITLE CHARGES"), plus the amount of other
closing costs which are Buyer's responsibility as set forth on the Disbursement
Schedule (the "BUYER'S CLOSING COSTS"), and (b) deliver to Escrow Agent to be
held in escrow in accordance with the terms of this Agreement, original,
executed counterpart copies of the Buyer Documents. Simultaneously therewith
Seller shall deliver to Escrow Agent, to be held in escrow in accordance with
the provisions of this Agreement, original counterpart copies of the Seller's
Documents. Once Escrow Agent has received the Closing Funds, the Buyer Documents
and the Seller's Documents, Escrow Agent shall simultaneously (a) apply the
Closing Funds in accordance with the Disbursement Schedule, by wire transfer to
Seller's Lender in accordance with the wire instructions in the Payoff Letter,
by wire transfer to Seller in accordance with Seller's wire instructions, and by
payment of the deed excise stamp taxes, recording fees and other closing costs
listed in the Disbursement Schedule, and (b) deliver to Buyer the Owner's Title
Insurance Policy. The delivery of the Title Insurance Policy and application of
the Closing Funds as hereinabove provided shall be referred to herein as the
"CLOSING CONDITIONS."
Upon satisfaction of the Closing Conditions, Escrow Agent shall be
entitled to payment of the Title Charges from the amount held in escrow. Escrow
Agent agrees to promptly record the deeds from Seller to Buyer in the
appropriate land records office, and to promptly obtain from the Seller's
Lender, and thereafter promptly record, the assignment and assumption of all
mortgages, assignment of leases and rents and UCC financing statements securing
the Mortgage Debt referred to in the Purchase Agreement, (collectively, the
"RELEASES").
Escrow Agent agrees to promptly deliver the original recorded Releases
to Seller's counsel and copies of the recorded Releases to Buyer's counsel.
If the Closing Conditions have not been satisfied by ____ p.m. on
____________, 199_, unless otherwise instructed jointly by both Buyer and
Seller, Escrow Agent shall immediately (i) wire transfer the Buyer's Transfer
Amount to Buyer, together with any interest earned thereon, in accordance with
Buyer's Wiring Instructions (ii) return the Seller's Documents to Sellers, and
(iii) return the Buyer's Documents to Buyer.
In connection with this Agreement, Escrow Agent may rely upon
instructions from (i) Seller's counsel, Daniel D. Sullivan or Franz T. Litz of
Brown, Rudnick, Freed & Gesmer, P.C., and (ii) Buyer's counsel
__________________________________________________.
EXECUTED as of the date first written above.
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<PAGE>
SELLER:
WCA LIMITED PARTNERSHIP
By: James-Town Properties II, Inc.,
its General Partner
By: ______________________________
Name:
Title:
BUYER:
NEW ENGLAND REALTY ASSOCIATES
By: ___________________________________
Name: _____________________________
Title: ____________________________
ESCROW AGENT:
TITLE INSURANCE COMPANY, a
By: ___________________________________
Name: _____________________________
Title: ____________________________
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<PAGE>
EXHIBIT I
SUPPLEMENTAL ESCROW AGREEMENT
We, the undersigned, do hereby jointly and severally agree that the Escrow
Agent, __________ Title Insurance Company ("TC"), shall incur no liability
whatsoever in connection with its good faith performance under this Escrow
Agreement, and do hereby jointly and severally release and waive any claims we
may have against TC, which may result from its performance in good faith of its
function under this agreement, including but not limited to, a delay in the
electronic wire transfer of funds. TC shall be liable only for loss or damage
caused directly by its acts of negligence while performing as Escrow Agent under
this Escrow Agreement.
3.1. DUTIES. The Escrow Agent undertakes to perform only those duties
which are expressly set forth in this Agreement and acknowledge that these
duties are purely ministerial in nature.
The Escrow Agent shall be entitled to rely upon the authenticity of any
signature and the genuineness and validity of any writing received by Escrow
Agent relating to this Escrow Agreement. Escrow Agent is not responsible for the
nature, content, validity or enforceability of any of the escrow documents
except for those documents prepared by TC.
In the event of any disagreement between the parties hereto resulting in
conflicting instructions to, or adverse claims or demands upon the Escrow Agent
with respect to the release of the escrow funds or the escrow documents, the
Escrow Agent may refuse to comply with any such instruction, claim or demand so
long as such disagreement shall continue and in so refusing the Escrow Agent
shall not release the escrow funds or the escrow documents. The Escrow Agent
shall not be, or become liable in any way for its failure or refusal to comply
with any such conflicting instructions or adverse claims or demands and it shall
be entitled to continue to refrain from acting until such conflicting
instructions or adverse claims or demands (a) shall have been adjusted by
agreement and it shall have been notified in writing thereof by the parties
hereto; or (b) shall have finally been determined in a court of competent
jurisdiction. In the alternative, Escrow Agent may, but shall not be obligated
to, file a suit in interpleader for a declaratory judgment for the purpose of
having the respective rights of the claimants adjudicated and may deliver to the
court in the Funds.
3.2. EXPENSES. The Escrow Agent shall be entitled to receive
reimbursement as Escrow Agent of documented reasonable attorneys' fees and other
documented out-of-pocket expenses incurred by it in the performance of its
duties under this Agreement, which shall be paid in equal amounts by Seller and
Buyer. If the Escrow Agent's duties and responsibilities are increased beyond
the contemplated within this Agreement, additional compensation will be allowed
as agreed upon in writing by all of the parties hereto. Such additional
compensation shall be shared equally by Seller and Buyer.
The Escrow Agent may at its sole discretion resign by giving (30) days written
notice thereof to the parties hereto. The parties shall furnish to the Escrow
Agent written instructions for the
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release of the escrow funds and escrow documents. If the Escrow Agent shall not
have received such written instructions within the thirty (30) days, the Escrow
Agent may petition any court of competent jurisdiction for the appointment of a
successor Escrow Agent and upon such appointment deliver the escrow funds and
escrow documents to such successor. Costs and fees incurred by the Escrow Agent
may, at the option of the Escrow Agent, be deducted from any funds held pursuant
hereto. The Escrow Agent neither approves nor disapproves of this transaction,
nor does it recommend for or against, nor does it have an opinion as to the
legality or validity of the transaction.
3.3 If the Fund is at any time attached, garnished, or levied upon
under any court order or if the payment or delivery of the Fund is stayed or
enjoined by any court order, or if any order, judgment or decree shall be made
or entered by any court affecting the Fund, Escrow Agent is authorized, in its
sole discretion, to rely upon and comply with the order, writ, judgment or
decree. Escrow Agent shall not be liable to any of the parties or to any other
person firm or corporation by reason of such compliance even though the order,
writ, judgment or decree may be subsequently reversed modified, annulled, set
aside or vacated.
3.4 Upon making disposition of the Deposit in accordance with this
Agreement, Escrow Agent shall be deemed fully released and discharged from any
and all duties and obligations under this Agreement, without the need that any
other documentation be executed by Seller or Purchaser.
3.5 Escrow Agent shall not be responsible for (i) any fluctuations in
the interest rate applicable to any cash held by it pursuant to or by virtue of
this Agreement (ii) the validity, sufficiency, collectability, or legal effect
of any instrument deposited with Escrow Agent.
3.6 Notwithstanding anything contained in this Agreement to the
contrary, Escrow Agent has the right (but not the obligation) to require from
Seller and Purchaser a written release of liability of Escrow Agent, a written
authorization to disburse the deposit, or both.
The parties hereto do hereby certify that they are aware that the Federal
Deposit Insurance Corporation ("FDIC") coverages apply only to a cumulative
maximum amount of $100,000 for each individual deposit for all of depositor's
accounts at the same or related institution. The parties hereto further
understand that certain banking instruments such as, but not limited to,
repurchase agreements and letters of credit are not covered at all by FDIC
insurance.
Further the parties hereto understand that Escrow Agent assumes no
responsibility for, nor will the parties hereto hold Escrow Agent liable for,
any loss incurring which arises from the fact that the amount of the above
account may cause the aggregate amount of any individual depositor's accounts to
exceed $100,000 and that the excess amount is not insured by the Federal Deposit
Insurance Corporation or that FDIC insurance is not available on certain types
of bank instruments. Federal I.D. or Social Security No. _______________.
