FORM 8-K - CURRENT REPORT
(As last amended in Rel. No. 34-36968, eff. August 13, 1992.)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) June 18, 1999
CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES/3
(Exact name of registrant as specified in its charter)
California 0-14187 94-2940208
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification
Number)
55 Beattie Place
Post Office Box 1089
Greenville, South Carolina 29602
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (864) 239-1000
N/A
(Former name or former address, if changed since last report)
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
South City Business Center, located in Chula Vista, California, was sold by the
Registrant on June 18, 1999. The property was sold to Eastgate Technology
Partners, L.P., a California Limited Partnership, an unrelated party, for
$6,960,000.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(b) Pro forma financial information.
The required pro forma financial information will be provided in the
Registrant's quarterly report on Form 10-Q for the quarter ended June 30, 1999.
(c) Exhibits
10.42 Purchase and Sale Contract between Registrant and Eastgate Technology
Partnership, L.P., a California limited partnership, dated April 30,
1999.
10.43 Amendment to Purchase and Sale Contract between Registrant and Eastgate
Technology Partners, L.P., dated May 28, 1999.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES/3
By: CONCAP EQUITIES, INC.
Its General Partner
By: /s/ Patrick J. Foye
Patrick J. Foye
Executive Vice President
Date: July 2, 1999
EXHIBIT 10.42
PURCHASE AND SALE CONTRACT
BETWEEN
CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES/3
AS SELLER
AND
EASTGATE TECHNOLOGY PARTNERS L.P.
AS PURCHASER
TABLE OF CONTENTS
Page
ARTICLE 1 DEFINED TERMS 1
ARTICLE 2 PURCHASE AND SALE OF PROPERTY 4
ARTICLE 3 PURCHASE PRICE & DEPOSIT 4
ARTICLE 4 FINANCING 5
ARTICLE 5 FEASIBILITY PERIOD 5
ARTICLE 6 TITLE 7
ARTICLE 7 CLOSING 10
ARTICLE 8 REPRESENTATIONS, WARRANTIES AND COVENANTS OF SELLER
AND PURCHASER 14
ARTICLE 9 CONDITIONS PRECEDENT TO CLOSING 19
ARTICLE 10 BROKERAGE 20
ARTICLE 11 INTERIM OPERATION/POSSESSION 21
ARTICLE 12 DEFAULTS AND REMEDIES 21
ARTICLE 13 RISK OF LOSS OR CASUALTY 22
ARTICLE 14 EXECUTION 23
ARTICLE 15 EMINENT DOMAIN 23
ARTICLE 16 MISCELLANEOUS 23
PURCHASE AND SALE CONTRACT
THIS PURCHASE AND SALE CONTRACT ("Purchase Contract") is entered into as
of April 30, 1999 (the "Effective Date") by and among CONSOLIDATED CAPITAL
INSTITUTIONAL PROPERTIES/3, a California limited partnership, having a principal
address at c/o AIMCO, 1873 South Bellaire Street, Suite 1700, Denver, CO 80222
("Seller") and EASTGATE TECHNOLOGY PARTNERS L.P., a California limited
partnership, having a principal address at 475 W. Bradley Avenue, El Cajon, CA
92020 ("Purchaser").
NOW, THEREFORE WITNESSETH: That for and in consideration of mutual
covenants and agreements herein after set forth, Seller and Purchaser hereby
agree as follows:
RECITALS
R-1. Seller holds legal title to a parcel of real estate more particularly
described in EXHIBIT A attached hereto and made a part hereof located in the
County of San Diego, State of California, on which improvements have been
constructed.
R-2. Purchaser desires to purchase and Seller has agreed to sell such land,
improvements and certain associated property, defined below as the "Property" on
the terms and conditions set forth below, (which terms and conditions shall
control in the event of any conflict with these Recitals), such that on the
Closing Date as defined in this Purchase Contract the Property will be conveyed
by grant deed to Purchaser.
R-3. Purchaser has agreed to pay to Seller the Purchase Price for the Property,
and Seller has agreed to sell the Property to Purchaser on the terms and
conditions set forth below.
ARTICLE 1
DEFINED TERMS
1.1 Terms with initial capital letters in this Purchase Contract shall have the
meanings set forth in this Article 1 below.
1.1.1 "BUSINESS DAY" means any day other than a Saturday or Sunday or
Federal holiday or legal holiday in the State of California.
1.1.2 "CLOSING" means the consummation of the purchase and sale and
related transactions contemplated by this Purchase Contract in
accordance with the terms and conditions of this Purchase Contract.
1.1.3 "CLOSING DATE" means the date on which date the Closing of the
conveyance of the Property is required to be held under the terms
and conditions of this Purchase Contract and on which date full
payment of the Purchase Price for the Property shall have been paid
to and received by Seller in immediately available U.S. funds, which
Closing Date shall be fifteen (15) days following the expiration of
the Feasibility Period, unless Purchaser and Seller, in their
respective sole discretion, agree upon a different Closing Date.
1.1.4 "COMMERCIAL LEASE(S)" means the interest of Seller in and to all
leases, subleases and other occupancy agreements, whether or not of
record, which provide for the use or occupancy of space or
facilities on or relating to the Property scheduled on EXHIBIT 1.1.4
attached hereto.
1.1.5 "EXCLUDED PERMITS" means those Permits which, under applicable law,
are nontransferable and such other Permits as may be designated as
Excluded Permits on EXHIBIT 1.1.5, if any, attached hereto.
1.1.6 "FIXTURES AND TANGIBLE PERSONAL PROPERTY" means all fixtures,
furniture, furnishings, fittings, equipment, machinery, apparatus,
appliances and other articles of personal property now located on
the Land or in the Improvements as of the date of this Purchase
Contract and as of the date of the end of the Feasibility Period
described below and used or usable in connection with any present or
future occupation or operation of all or any part of the Property.
The term "Fixtures and Tangible Personal Property" does not include
(i) equipment leased by Seller and the interest of Seller in any
equipment provided to the Property for use, but not owned or leased
by Seller, or (ii) property owned or leased by Tenants and guests,
employees or other persons furnishing goods or services to the
Property or (iii) property and equipment owned by Seller, which in
the ordinary course of business of the Property is not used
exclusively for the business, operation or management of the
Property or (iv) the property and equipment, if any, expressly
identified in EXHIBIT 1.1.6.
1.1.7 "IMPROVEMENTS" means all buildings and improvements, located on the
Land taken "as is" containing approximately 167,766 gross square
feet of industrial buildings.
1.1.8 "LAND" means all of that certain tract of land located in County of
San Diego, State of California which is legally described in EXHIBIT
A attached hereto and made a part hereof and all rights, privileges
and appurtenances pertaining thereto.
1.1.9 "MISCELLANEOUS PROPERTY ASSETS" means all contract rights, leases,
concessions, warranties, plans, drawings and other items of
intangible personal property relating to the ownership or operation
of the Property and owned by Seller, including, without limitation,
any interest of Seller to use the name "South City Business Center"
for common reference to the Property excluding, however, (i)
receivables, (ii) Property Contracts, (iii) Commercial Leases, (iv)
Permits, (v) cash or other funds, whether in petty cash or house
"banks," or on deposit in bank accounts or in transit for deposit,
(vi) refunds, rebates or other claims, or any interest thereon, for
periods or events occurring prior to the Closing Date, (vii) utility
and similar deposits, (viii) insurance or other prepaid Items, or
(ix) books and records, except to the extent that Seller receives a
credit on the closing statement for any such item.
1.1.10 "PERMITS" means all licenses and permits granted by governmental
authorities having jurisdiction over the Property in respect of the
matter to which the applicable license or permit applies and owned
by Seller or used in or relating to the ownership, occupancy or
operation of the Property or any part thereof not subject to a
Commercial Lease.
1.1.11 "PERMITTED EXCEPTIONS" means those exceptions or conditions
permitted to encumber the title to the Property in accordance with
the provisions of Section 6.2.
1.1.12 "PROPERTY" means the Land and Improvements described in the
Recitals and all rights of Seller relating to the Land and the
Improvements, including without limitation, any rights, title and
interest of Seller, if any, in and to (i) any strips and gores
adjacent to the Land and any land lying in the bed of any street,
road, or avenue opened or proposed, in front of or adjoining the
Land, to the center line thereof; (ii) any unpaid award for any
taking by condemnation or any damage to the Property by reason of a
change of grade of any street or highway; (iii) all of the
easements, rights, privileges, and appurtenances belonging or in any
way appertaining to the Property; together with all Fixtures and
Tangible Personal Property, the right, if any and only to the extent
transferable, of Seller issued to Property Contracts (other than
those contracts , if any, which are identified for termination by
Purchaser on EXHIBIT 6.2.3 attached hereto) and Commercial Leases,
Permits other than Excluded Permits and the Miscellaneous Property
Assets owned by Seller which are located on the Property and used in
its operation.
1.1.13 "PROPERTY CONTRACTS" means all purchase orders, maintenance,
service, or utility contracts and similar contracts, which relate to
the ownership, maintenance, construction or repair and/or operation
of the Property scheduled on EXHIBIT 1.1.13 attached hereto, in any
event excluding Commercial Leases
1.1.14 "PURCHASE CONTRACT" means this Purchase and Sale Contract by and
between Seller and Purchaser.
1.1.15 "PURCHASE PRICE" means the total consideration to be paid by
Purchaser to Seller for the purchase of the Property.
1.1.16 "SURVEY" shall have the meaning ascribed thereto in Section 6.10.
1.1.17 "TENANT" means any person or entity entitled to occupy any portion
of the Property under a Commercial Lease.
1.1.18 "TITLE COMMITMENT" or "Title Commitments" shall have the meaning
ascribed thereto in Section 6.1.
1.1.19 "TITLE INSURER" shall have the meaning set forth in Section 6.1.
ARTICLE 2
PURCHASE AND SALE OF PROPERTY
2.1 Seller agrees to sell and convey the Property to Purchaser and Purchaser
agrees to purchase the Property from Seller, in accordance with the terms
and conditions set forth in this Purchase Contract.
ARTICLE 3
PURCHASE PRICE & DEPOSIT
3.1 The total purchase price ("Purchase Price") for the Property shall be Six
Million, Nine Hundred Sixty Thousand Dollars ($6,960,000.00), which shall
be paid by Purchaser, as follows:
3.1.1 Within one (1) Business Day after Seller's delivery of a signed copy
of this Purchase Contract, Purchaser shall deliver to Fidelity
National Title Insurance Company, Bank of America Center, 700
Louisiana, Suite 2600, Houston, Texas 77002 ("Escrow Agent" or the
"Title Company") a deposit in the sum of Two Hundred and Fifty
Thousand Dollars ($250,000.00) in cash or cash equivalent, which sum
shall be increased within two (2) Business Days from the time of
expiration of the Feasibility Period (defined below) at which time
Purchaser shall tender an additional sum of Two Hundred and Fifty
Thousand Dollars ($250,000.00) in cash or cash equivalent, such that
the total deposit within two (2) Business Days of the time of
expiration of the Feasibility Period shall equal Five Hundred
Thousand Dollars ($500,000.00) (such sums, together with any
interest or earnings thereon, being hereinafter collectively
referred to and held as the "Deposit"). Purchaser and Seller each
approve the Escrow Agreement attached as EXHIBIT B, and Purchaser
agrees to sign the Escrow Agreement in such form and deliver a
counterpart of the same to the Escrow Agent along with the Deposit
and a counterpart of the same to Seller.
3.1.2 The Escrow Agent shall hold the Deposit and make delivery of the
Deposit to the party entitled thereto under the terms hereof.
Escrow Agent shall invest the Deposit in such short-term, high-grade
securities, interest-bearing bank accounts, money market funds or
accounts, bank certificates of deposit or bank repurchase agreements
as Escrow Agent, in its discretion, deems suitable, (provided that
Escrow Agent shall invest the Deposit as jointly directed by Seller
and Purchaser should Seller and Purchaser each in their respective
sole discretion determine to issue such joint investment
instructions to the Escrow Agent) and all interest and income
thereon shall become part of the Deposit and shall be remitted to
the party entitled to the Deposit, as set forth below.
3.1.3 If the sale of the Property is closed by the date fixed therefor (or
any extension date provided for by the mutual written consent of the
parties hereto, given or withheld in their respective sole
discretion), monies held as the Deposit shall be applied (and paid
over to Seller) on the Closing Date. If the sale of the Property is
not closed by the date fixed therefor (or any such extension date)
owing to failure of satisfaction of a condition precedent to
Purchaser's obligations, the Deposit shall be returned and refunded
to Purchaser, and neither party shall have any further liability
hereunder, subject to and except for Purchaser's liability under
Section 5.3.
3.1.4 If the sale of the Property is not closed by the date fixed therefor
(or any such extension date) owing to failure of performance by
Seller, Purchaser shall be entitled to the remedies set forth in
ARTICLE 12 hereof. If the sale of the Property is not closed by the
date fixed therefor (or any such extension date) owing to failure of
performance by Purchaser, the Deposit shall be forfeited by
Purchaser and the sum thereof shall go to Seller forthwith as
liquidated damages for the lost opportunity costs and transaction
expenses incurred by Seller, as more fully set forth in ARTICLE 12
below.
3.2 On the Closing Date, Purchaser shall pay Seller the amount of Six Million
Nine Hundred Sixty Thousand Dollars ($6,960,000.00), subject to credit and
adjustment as provided herein, in cash or by wire-transfer of current funds
through escrow pursuant to wire instructions provided by Seller.
ARTICLE 4
FINANCING
4.1 Purchaser assumes full responsibility to expeditiously and diligently
initiate and pursue all steps necessary to obtain the funds required for
settlement.
ARTICLE 5
FEASIBILITY PERIOD
5.1 Subject to the terms of Section 5.3, for thirty (30) calendar days
following the Effective Date (the "Feasibility Period"), Purchaser, and its
agents, contractors, engineers, surveyors, attorneys, and employees
("Consultants") shall have the right from time to time to enter onto the
Property:
5.1.1 To conduct and make any and all customary studies, tests,
examinations and inspections, or investigations of or concerning the
Property (including without limitation, engineering and feasibility
studies, evaluation of drainage and flood plain, soil tests for
bearing capacity and percolation and surveys, including
topographical surveys). Notwithstanding the foregoing, in no event
shall Purchaser conduct any invasive environmental assessment, test
or other inspection of the Property without prior written consent of
Seller, which consent may be withheld, in Seller's sole discretion.
5.1.2 To confirm any and all matters which Purchaser may, in its sole
discretion, desire to confirm with respect to the Property.
5.1.3 To ascertain and confirm the suitability of the property for
Purchaser's intended use of the Property.
5.2 Should the results of any of the matters referred to in Section 5.1 above
appear unsatisfactory to Purchaser, in Purchaser's sole discretion, or
Purchaser otherwise determines that it is not satisfied, in its sole
discretion, with the condition of the Property and/or the advisability of
an economic investment in the Property, then Purchaser shall have the right
to terminate this Purchase Contract by giving written Notice to that effect
to Seller and Escrow Agent on or before 5:00 p.m. EST on the date of
expiration of the Feasibility Period. If Purchaser exercises such right to
terminate, this Purchase Contract shall terminate and be of no further
force and effect, subject to and except for Purchaser's liability under
Section 5.3, and Escrow Agent shall forthwith return the Deposit to
Purchaser. If Purchaser fails to provide Seller with written Notice of
cancellation prior to the end of the Feasibility Period in strict
accordance with the Notice provisions of this Purchase Contract, this
Purchase Contract shall remain in full force and effect and Purchaser's
obligation to purchase the Property shall be non-contingent and
unconditional except only for satisfaction of the conditions expressly
stated in this Purchase Contract.
5.3 Purchaser shall indemnify and hold Seller harmless for any actions taken by
Purchaser and its Consultants on the Property. Purchaser shall indemnify,
defend (with attorneys selected by Seller) and hold Seller harmless from
any and all claims, damages, costs and liability which may arise due to
such entries, surveys, tests, investigations and the like (including,
without limitation, any claims arising from a breach of Section 4.4).
Seller shall have the right, without limitation, to disapprove any and all
entries, surveys, tests, investigations and the like that in their
reasonable judgment could result in any injury to the Property or breach of
any agreement, or expose Seller to any liability, costs, liens or
violations of applicable law, or otherwise adversely affect the Property or
Seller's interest therein. No consent by the Seller to any such activity
shall be deemed to constitute a waiver by Seller or assumption of liability
or risk by Seller. Purchaser hereby agrees to restore the Property to the
same condition existing immediately prior to Purchaser's exercise of its
rights pursuant to this ARTICLE 5 at Purchaser's sole cost and expense.
Purchaser shall maintain casualty insurance and comprehensive public
liability insurance with broad form contractual and personal injury
liability endorsements with respect to the Property and Purchaser's
activities carried on therein, in amounts (including deductible amounts)
and with such insurance carriers as shall be approved by Seller and naming
Seller and its affiliates as Loss Payees or Additional Insureds (at the
option of Seller), with endorsements acceptable to Seller, including a
waiver of defenses of the insurer based on the actions or inaction of
Purchaser. Such liability insurance shall provide coverages of not less
than $1,000,000.00 for injury or death to any one person and $3,000,000.00
for injury or death to more than one person and $500,000.00 with respect to
property damage, by water or otherwise). The provisions of this Section
shall survive the Closing or termination of this Purchase Contract.
5.4 Purchaser shall not permit any mechanic's or materialman's liens or any
other liens to attach to the Property by reason of the performance of any
work or the purchase of any materials by Purchaser or any other party in
connection with any studies or tests conducted by or for Purchaser.
Purchaser shall give notice to Seller a reasonable time prior to entry onto
the Property and shall permit Seller to have a representative present
during all investigations and inspections conducted with respect to the
Property. Purchaser shall take all reasonable actions and implement all
protections necessary to ensure that all actions taken in connection with
the investigations and inspections of the Property, and all equipment,
materials and substances generated, used or brought onto the Property pose
no material threat to the safety of persons or the environment and cause no
damage to the Property or other property of Seller or other persons. All
information made available by Seller to Purchaser in accordance with this
Purchase Contract or obtained by Purchaser in the course of its
investigations shall be treated as confidential information by Purchaser,
and, prior to the purchase of the Property by Purchaser, Purchaser shall
use its best efforts to prevent its agents and employees from divulging
such information to any unrelated third parties except as reasonably
necessary to third parties engaged by Purchaser for the limited purpose of
analyzing and investigating such information for the purpose of
consummating the transaction contemplated by this Purchase Contract,
including Purchaser's attorneys and representatives, prospective lenders
and engineers.
ARTICLE 6
TITLE
6.1 Prior to the Effective Date, Purchaser received that certain Fidelity
National Title Insurance Company Preliminary Report File No. 70736-JO dated
January 27, 1999 ("Title Report"). Purchaser shall promptly secure a
commitment for title insurance for the Property in an amount equal to the
Purchase Price ("Title Commitment") issued by Fidelity National Title
Insurance Company ("Title Insurer") for an owner's title insurance policy
on the most recent standard American Land Title Association ("ALTA") Policy
form, together with legible copies of all instruments identified as
exceptions therein. Purchaser agrees that it shall be solely responsible
for payment of all costs relating to procurement of the Title Commitment
and any Owner's or Lender's title policies.
6.2 Prior to the end of the Feasibility Period, Purchaser reserves the right to
continue its review of the state of title to the Property as reflected in
the Title Report received by Purchaser and under the Title Commitment to be
obtained by Purchaser. Should Purchaser's review of the state of title
disclose conditions deemed unsatisfactory to Purchaser, Purchaser shall
have the right to object thereto and exercise the right to terminate this
Purchase Contract within the Feasibility Period in accordance with the
procedures set froth in ARTICLE 5 above (but if such objection shall be
waived or shall be deemed waived by Purchaser, such objection shall become
an additional "Permitted Exception" to the extent not already included
within the term "Permitted Exception" as defined below). Unless Purchaser
shall, in its discretion, elect to terminate this Purchase Contract by
reason of Purchaser's dissatisfaction with the state of title to the
Property by giving Notice to Seller of such election prior to the end of
the Feasibility Period, Purchaser agrees to accept title to the Land and
Improvements, by Grant Deed pursuant to this Purchase Contract, subject to
the Permitted Exceptions. The term "Permitted Exceptions" shall mean, in
addition to exceptions disclosed on the Title Commitment, the following:
6.2.1 All title exceptions listed on Exhibit B of the form of Grant Deed
attached hereto as EXHIBIT 6.2.1; and
6.2.2 All Commercial Leases; and
6.2.3 All Property Contracts (other than those contracts, if any, which
are identified for termination by Purchaser on EXHIBIT 6.2.3
attached hereto, which Notice of request for termination by
Purchaser shall be made within fifteen (15) days after the Effective
Date); and
6.2.4 Non-delinquent real estate and property taxes to the extent not due
and payable.
6.3 The existence of other mortgages, liens, or encumbrances shall not be
objections to title, provided that properly executed instruments in
recordable form necessary to satisfy and remove the same of record are
delivered to Escrow Agent at Closing or, in the alternative, with respect
to any mortgage or deed of trust liens, that payoff letters from the holder
of the mortgage or deed of trust liens shall have been delivered to and
accepted by the Title Insurer (sufficient to remove the same from the
policy issued at Closing), together in either case, with recording and/or
filing fees.
6.4 Unpaid liens for taxes, charges, and assessments shall not be objections to
title, but the amount thereof plus interest and penalties thereon shall be
deducted from the Purchase Price to be paid for the Property hereunder and
allowed to Purchaser, subject to the provisions for apportionment of taxes
and charges contained herein.
6.5 Unpaid franchise or business corporation taxes of any corporations in the
chain of title shall not be an objection to title, provided that the Title
Insurer agrees to insure against collection out of the Property or
otherwise against Purchaser or its affiliates, and provided further that
the Title Insurer agrees to omit such taxes as exceptions to coverage with
respect to any lender's mortgagee insurance policy.
6.6 If on the Closing Date, the state of title is other than in accordance with
the requirements set forth in this Purchase Contract or if any condition to
be fulfilled by Seller shall not be satisfied, Purchaser shall provide
Seller with written Notice thereof at such time, or such title objection or
unfulfilled condition shall be deemed waived by Purchaser in which case
Purchaser and Seller shall proceed to consummate the Closing on the Closing
Date. If Purchaser timely gives Seller such Notice, Seller at its sole
option and within Seven (7) calendar days following receipt of such Notice
may elect to cure such objection or unfulfilled condition for up to thirty
(30) calendar days. Should Seller be able to cure such title objection or
condition by the Closing Date or any postponed Closing Date, or should
Purchaser waive such objection or condition within such period for cure,
then the Closing shall take place on or before thirty (30) calendar days
after Notice of such cure or waiver.
6.7 If during the period of cure Seller is unable or unwilling, in its sole
discretion or opinion, to eliminate such title objection, Seller shall give
Purchaser written Notice thereof, and if Purchaser does not waive such
objection by written Notice delivered to Seller and the title company
issuing the Title Commitment on or before Seven (7) calendar days following
the date Seller gives such Notice, then this Purchase Contract shall
automatically terminate, in which event Purchaser shall release all of
Purchaser's right and interest in such Property to Seller, Deposit shall be
released by Escrow Agent to Purchaser, and, subject to and except for
Purchaser's liability under Section 5.3, the parties hereto shall have no
further obligations to each other.
6.8 Seller covenants that it will not voluntarily create or cause any lien or
encumbrance (other than Commercial Leases and Property Contracts in the
ordinary course of business) to attach to the Property between the date of
this Purchase Contract and the Closing Date; any such monetary lien or
encumbrance so attaching by voluntary act of Seller shall be discharged by
the Seller at or prior to Closing on the Closing Date or any postponed
Closing Date. Except as expressly provided above, Seller shall not be
required to undertake efforts to remove any other lien, encumbrance,
security interest, exception, objection or other matter, to make any
expenditure of money or institute litigation or any other judicial or
administrative proceeding and Seller may elect not to discharge the same.
6.9 After the Feasibility Period, Purchaser shall not have any right to
terminate this Purchase Contract or object to any lien, encumbrance,
exception or other matter that is a Permitted Exception, or that has been
waived or deemed to have been waived by Purchaser.
6.10 If Purchaser desires to obtain a survey of the Property ("Survey"),
Purchaser shall obtain such Survey at Purchaser's sole cost and expense,
and shall cause such Survey to be promptly delivered to Seller within the
Feasibility Period. The Survey (i) shall be prepared in accordance with
and shall comply with the minimum requirements of the ALTA; (ii) shall be
in a form, and shall be certified as of a date satisfactory to Title
Insurer to enable Title Insurer to delete standard survey exceptions from
the title insurance policy to be issued pursuant to the Title Commitments,
except for any Permitted Exceptions; (iii) shall specifically show all
improvements, recorded easements to the extent locatable, set back lines,
and such other matters shown as exceptions by the Title Commitments;
(iv) shall specifically show the right of way for all adjacent public
streets; (v) shall specifically disclose whether (and, if so, what part of)
any of the Property is in an area designated as requiring flood insurance
under applicable federal laws regulating lenders; (vi) shall contain a
perimeter legal description of the Property which may be used in the Grant
Deed; (vii) shall be certified to Purchaser, Purchaser's lender, Seller and
Title Insurer as being true and correct; and (viii) shall certify that the
legal description set forth therein describes the same, and comprises all
of, the real estate comprising the Property to be purchased by Purchaser
pursuant to the terms of this Purchase Contract. In the event the
perimeter legal description of the Property contained in the Survey differs
from that contained in the deed or deeds by which Seller took title to the
Property, the latter description shall be used in the Grant Deed delivered
to Purchaser at Closing, and the Survey legal shall be used in a quitclaim
deed to the Property which also shall be delivered to Purchaser at Closing.
6.10.1 Should such Survey disclose conditions that give rise to a title
exception other than a Permitted Exception, Purchaser shall have the
right to object thereto within the Feasibility Period in accordance
with the procedures set forth in ARTICLE 5 above.
6.10.2 If Purchaser elects to obtain the Survey, Purchaser agrees to make
payment in full of all costs of obtaining the Survey required by
this Purchase Contract on or before Closing or termination of this
Purchase Contract.
ARTICLE 7
CLOSING
7.1 DATES, PLACES OF CLOSING, PRORATIONS, DELINQUENT RENT, SELLER'S PAYMENTS
AND BUYER'S PAYMENTS
7.1.1 The Closing shall be conducted by Mike Hinkle, an agent of the
Escrow Agent, at such place as the parties shall mutually agree upon
at a time mutually agreed upon on the Closing Date. If requested by
Seller, Purchaser shall agree to conduct closing through a pre-
closing, an escrow or other arrangement reasonably requested by
Seller, whereby the Seller and its attorneys need not be physically
present at the Closing and may deliver documents by overnight air
courier or other means.
7.1.2 All normal and customarily proratable items, including, without
limitation, Rents (as defined below), operating expenses, personal
property taxes, other operating expenses and fees, shall be prorated
as of the Closing Date, Seller being charged and credited for all of
same attributable to the period up to the Closing Date (and credited
for any amounts paid by Seller attributable to the period on or
after the Closing Date) and Purchaser being responsible for, and
credited or charged, as the case may be, for all of same
attributable to the period on and after the Closing Date. All
unapplied deposits under Commercial Leases, if any, shall be
transferred by Seller to Purchaser at the Closing. Purchaser shall
assume at Closing the obligation to pay any accrued but unpaid
tenant improvement allowances and leasing commissions, together with
any payments due parties to other agreements affecting the Property
which survive Closing, to the extent such items are scheduled on
Exhibit 1.1.4 or are hereafter approved in writing by Purchaser.
Any real estate ad valorem or similar taxes for the Property, or any
installment of assessments payable in installments which installment
is payable in the year of Closing, shall be prorated to the date of
Closing, based upon actual days involved. The proration of real
property taxes or installments of assessments shall be based upon
the assessed valuation and tax rate figures for the year in which
the Closing occurs to the extent the same are available; provided,
that in the event that actual figures (whether for the assessed
value of the Property or for the tax rate) for the year of Closing
are not available at the Closing Date, the proration shall be made
using figures from the preceding year. The proration shall be final
and unadjustable except as provided in the following paragraph. For
purposes of this Section 7.1.2 and Sections 7.1.3 and 7.1.4, the
terms "Rent" and "Rents" shall include, without limitation, base
rents, additional rents, percentage rents and common area
maintenance charges. The provisions of this Section 7.1.2 shall
apply during the Proration Period (as defined below).
7.1.3 If any of the items subject to proration hereunder cannot be
prorated at the Closing because the information necessary to compute
such proration is unavailable, or if any errors or omissions in
computing prorations at the Closing are discovered subsequent to the
Closing, then such item shall be reapportioned and such errors and
omissions corrected as soon as practicable after the Closing Date
and the proper party reimbursed, which obligation shall survive the
Closing for a period (the "Proration Period") from the Closing Date
until one (1) year after the Closing Date. Neither party hereto
shall have the right to require a recomputation of a Closing
proration or a correction of an error or omission in a Closing
proration unless within the Proration Period one of the parties
hereto (i) has obtained the previously unavailable information or
has discovered the error or omission, and (ii) has given Notice
thereof to the other party together with a copy of its good faith
recomputation of the proration and copies of all substantiating
information used in such recomputation. The failure of a party to
obtain any previously unavailable information or discover an error
or omission with respect to an item subject to proration hereunder
and to give Notice thereof as provided above within the Proration
Period shall be deemed a waiver of its right to cause a
recomputation or a correction of an error or omission with respect
to such item after the Closing Date. Any Rents due under a
Commercial Lease that is not then in default for the rental payment
period in which the Closing Date occurs that have accrued, but have
not yet been paid shall be prorated in accordance with estimates
based upon the prior years' information (or reasonable estimate of
Seller if no such prior years' information is available) and shall
be subsequently readjusted and reapportioned upon receipt.
Purchaser shall pay Seller for Rents that have accrued, but are not
yet due and payable, at Closing.
7.1.4 If on the Closing Date any Tenant is in arrears in any Rent payment
under any Commercial Lease (the "Delinquent Rent"), any Delinquent
Rent received by Purchaser or Seller from such Tenant after the
Closing shall be applied to amounts due and payable by such Tenant
during the following periods in the following order of priority:
(i) first, to the period of time before the Closing Date, and
(ii) second, to the period of time after the Closing Date. If
Delinquent Rent or any portion thereof received by Seller or
Purchaser after the Closing are due and payable to the other party
by reason of this allocation, the appropriate sum, less a
proportionate share of any reasonable attorneys' fees and costs and
expenses expended in connection with the collection thereof, shall
be promptly paid to the other party. After the Closing, Seller
shall continue to have the right, but not the obligation, in its own
name, to demand payment of and to collect Delinquent Rent owed to
Seller by any Tenant, which right shall include, without limitation,
the right to continue or commence legal actions or proceedings
against any Tenant (provided, that Seller shall not commence any
legal actions or proceedings against any Tenant which continues as a
Tenant at the Property after Closing without the prior consent of
Purchaser, which will not be unreasonably withheld or delayed), and
the delivery of the Assignment as defined in Section 7.2.1.3 shall
not constitute a waiver by Seller of such right. Purchaser agrees
to cooperate with Seller at no cost or liability to Purchaser in
connection with all efforts by Seller to collect such Delinquent
Rent and to take all steps, whether before or after the Closing
Date, as may be necessary to carry out the intention of the
foregoing, including, without limitation, the delivery to Seller,
upon demand, of any relevant books and records (including, without
limitation, rent statements, receipted bills and copies of tenant
checks used in payment of such rent), the execution of any and all
consents or other documents, and the undertaking of any act
reasonably necessary for the collection of such Delinquent Rent by
Seller; provided, however, that Purchaser's obligation to cooperate
with Seller pursuant to this sentence shall not obligate Purchaser
to terminate any Tenant lease with an existing Tenant or evict any
existing Tenant from the Property nor, after the Closing Date, bring
a legal action against such Tenant. The provisions of this Section
7.1.4 shall apply during the Proration Period.
7.1.5 Seller and Purchaser shall each pay one-half of the Escrow Agent's
fee. Purchaser shall pay all costs associated with recording the
Grant Deed at Closing, including, but not limited to, recording
fees, but with the exception that Seller shall pay the documentary
transfer tax. With respect to the payment of other closing expenses
not otherwise addressed by this Purchase Contract, Purchaser and
Seller shall each pay their own respective closing expenses.
7.2 ITEMS TO BE DELIVERED PRIOR TO OR AT CLOSING.
7.2.1 SELLER. At Closing, Seller shall deliver to Purchaser, each of the
following items, as applicable:
7.2.1.1 A Grant Deed in the form attached as EXHIBIT 6.2.1 to
Purchaser. The acceptance of the deed at Closing, shall be
deemed to be full performance of, and discharge of, every
agreement and obligation on Seller's part to be performed
under this Purchase Contract, except for those that this
Purchase Contract specifically provides shall survive
Closing.
7.2.1.2 A Bill of Sale without recourse or warranty in the form
attached as EXHIBIT 7.2.1.2 covering all Property Contracts
(other than those contracts , if any, which are identified
for termination by Purchaser on EXHIBIT 6.2.3 attached
hereto), Commercial Leases, Permits (other than Excluded
Permits) and Fixtures and Tangible Personal Property
required to be transferred to Purchaser with respect to such
Property. Purchaser shall countersign the same so as to
effect an assumption by Purchaser, including, without
limitation, of Seller's obligations thereunder.
7.2.1.3 An Assignment (to the extent assignable and in force
and effect) without recourse or warranty in the form
attached as EXHIBIT 7.2.1.3 of all of Seller's right, title
and interest in and to the Miscellaneous Property Assets,
subject to any required consents. Purchaser shall
countersign the same so as to effect an assumption by
Purchaser, including, without limitation, of Seller's
obligations thereunder.
7.2.1.4 A closing statement executed by Seller.
7.2.1.5 A vendor's affidavit or at Seller's option an
indemnity, as applicable, in the customary form reasonably
acceptable to Seller to enable Title Insurer to delete the
standard exceptions, (other than matters constituting any
Permitted Exceptions to the title insurance policy set forth
in this Purchase Contract and matters which are to be
completed or performed post-Closing) to be issued pursuant
to the Title Commitments; provided that such affidavit does
not subject Seller to any greater liability, or impose any
additional obligations, other than as set forth in this
Purchase Contract; and
7.2.1.6 A certification of Seller's non-foreign status pursuant
to Section 1445 of the Internal Revenue Code of 1986, as
amended, in the form attached hereto as EXHIBIT 7.2.1.6
7.2.1.7 The originals of the Commercial Leases assigned to
Purchaser and the Property Contracts assumed by Purchaser,
to the extent in Seller's possession or under its control.
7.2.1.8 Except for the items expressly listed above to be
delivered at Closing, delivery of any other required items
shall be deemed made by Seller to Purchaser, if Seller
leaves such documents at the Property in their customary
place of storage or in the custody of Purchaser's
representatives.
7.2.2 Purchaser. At Closing, Purchaser shall deliver to Seller the
following items with respect to each Property being conveyed or
transferred by merger at such Closing:
7.2.2.1 The full Purchase Price as required by ARTICLE 3 hereof
plus or minus the adjustments or prorations required by this
Purchase Contract. If at Closing there are any liens or
encumbrances on the Property that Seller is obligated to pay
and discharge, Escrow Agent shall use, concurrently with the
Closing, any portion of the Purchase Price for the
Property(s) to satisfy the same, provided that Seller shall
have delivered to Purchaser, or to Purchaser's designee, on
such Closing instruments in recordable form sufficient to
satisfy such liens and encumbrances of record (or, as to any
mortgages or deeds of trust, appropriate payoff letters,
acceptable to the Title Insurer), together with the cost of
recording or filing such instruments. Purchaser, if request
is made within a reasonable time prior to Closing, agrees to
provide at Closing separate certified or cashier's checks as
requested, aggregating not more than the amount of the
balance of the portion of Purchase Price, to facilitate the
satisfaction of any such liens or encumbrances.
7.2.2.2 A closing statement executed by Purchaser.
7.2.2.3 A countersigned counterpart of the Bill of Sale in the
form attached as EXHIBIT 7.2.1.2.
7.2.2.4 A countersigned counterpart of the Assignment in the
form attached as EXHIBIT 7.2.1.3.
7.2.2.5 Such other instruments, documents or certificates as
are required to be delivered by Purchaser to Seller in
accordance with any of the other provisions of this Purchase
Contract.
ARTICLE 8
REPRESENTATIONS, WARRANTIES AND COVENANTS OF SELLER AND PURCHASER
8.1 REPRESENTATIONS AND WARRANTIES OF SELLER.
8.1.1 For the purpose of inducing Purchaser to enter into this Purchase
Contract and to consummate the sale and purchase of the Property in
accordance herewith, Seller represents and warrants to Purchaser the
following as of the Effective Date and as of the Closing Date:
8.1.1.1 Seller identified in the Recitals is lawfully and duly
organized, and in good standing under the laws of the state
of its formation set forth in the initial paragraph of this
Purchase Contract; and has or at Closing shall have the
power and authority to sell and convey the Property and to
execute the documents to be executed by Seller and prior to
Closing will have taken as applicable, all corporate,
partnership, limited liability company or equivalent entity
actions required for the execution and delivery of this
Purchase Contract, and the consummation of the transactions
contemplated by this Purchase Contract. The compliance with
or fulfillment of the terms and conditions hereof will not
conflict with, or result in a breach of, the terms,
conditions or provisions of, or constitute a default under,
any Purchase Contract to which Seller is a party or by which
Seller or any Subsidiary Owner is otherwise bound. Seller
has not made any other Purchase Contract for the sale of, or
given any other person the right to purchase, all or any
part of any of the Property applicable to the foregoing
representation;
8.1.1.2 Seller owns insurable, fee title to the Property,
including all real property contained therein required to be
sold to Purchaser, subject only to the Permitted Exceptions
and/or mortgages, deeds of trust or similar security
interests to be fully paid and discharged as of the Closing;
8.1.1.3 There are no adverse or other parties in possession of
the Property, except for occupants, guests and tenants under
the Commercial Leases or otherwise as set forth in EXHIBIT
8.1.1.3.
8.1.1.4 The joinder of no person or entity other than Seller is
necessary to convey the Property, fully and completely to
Purchaser at Closing, or to fulfill Seller's obligations and
Seller has all necessary right and authority to convey and
assign to Purchaser all contract rights and warranties
required to be conveyed and assigned to Purchaser hereunder;
8.1.1.5 Purchaser has no duty to collect withholding taxes for
Seller pursuant to the Foreign Investors Real Property Tax
Act of 1980, as amended;
8.1.1.6 To Seller's knowledge, there are no actions,
proceedings, litigation or governmental investigations or
condemnation actions either pending or threatened against
the Property, as applicable;
8.1.1.7 Seller has no knowledge of any claims for labor
performed, materials furnished or services rendered in
connection with constructing, improving or repairing any of
the Property, as applicable, caused or permitted by Seller
and which remain unpaid beyond the date for which payment
was due and in respect of which liens may or could be filed
against any of the Property, as applicable; and
8.1.1.8 Seller has not (i) made a general assignment for the
benefit of creditors, (ii) filed any voluntary petition in
bankruptcy or suffered the filing of an involuntary petition
by Seller's creditors, (iii) suffered the appointment of a
receiver to take possession of all, or substantially all, of
Seller's assets, (iv) suffered the attachment or other
judicial seizure of all, or substantially all, of Seller's
assets, (v) admitted in writing its inability to pay its
debts as they come due, or (vi) made an offer of settlement,
extension or composition to its creditors generally.
8.1.2 Except for the representations and warranties expressly set forth
above in Section 8.1.1 and any other covenants expressly set forth
in this Purchase Contract to be performed by Seller, the Property is
expressly purchased and sold "AS IS," "WHERE IS," and "WITH ALL
FAULTS." The Purchase Price and the terms and conditions set forth
herein are the result of arm's-length bargaining between entities
familiar with transactions of this kind, and said price, terms and
conditions reflect the fact that Purchaser shall have the benefit
of, and is relying upon, no information provided by Seller and no
statements, representations or warranties, express or implied, made
by or enforceable directly against Seller, including, without
limitation, any relating to the value of the Property, the physical
or environmental condition of the Property, the state, federal,
county or local law, ordinance, order, permit or suitability,
compliance or lack of compliance of the Property with any
regulation, or any other attribute or matter of or relating to the
Property (other than any covenants of title contained in the deeds
conveying the Property and the representations set forth above).
Purchaser represents and warrants that as of the date hereof and as
of the Closing Date, it has and shall have reviewed and conducted
such independent analyses, studies, reports, investigations and
inspections as it deems appropriate in connection with the Property.
If Seller provides or has provided any documents, opinions or work
product of consultants, surveyors, architects, engineers, title
companies, governmental authorities or any other person or entity
with respect to the Property, Purchaser and Seller agree that Seller
has done so or shall do so only for the convenience of both parties,
Purchaser shall not rely thereon and the reliance by Purchaser upon
any such documents, opinions or work product shall not create or
give rise to any liability of or against Seller, any Subsidiary
Owner, Seller's partners or affiliates or any of their respective
partners, officers, directors, participants, employees, contractors,
attorneys, consultants, representatives, agents, successors, assigns
or predecessors-in-interest. Except as provided in any covenants of
title contained in the deeds conveying the Property, Purchaser shall
rely only upon any title insurance obtained by Purchaser with
respect to title to the Property. Purchaser acknowledges and agrees
that no representation has been made and no responsibility is
assumed by Seller with respect to current and future applicable
zoning or building code requirements or the compliance of the
Property with any other laws, rules, ordinances or regulations, the
financial earning capacity or expense history of the Property, the
continuation of contracts, continued occupancy levels of the
Property, or any part thereof, or the continued occupancy by tenants
of any Commercial Leases or, without limiting any of the foregoing,
occupancy at Closing. Prior to Closing, Seller shall have the
right, but not the obligation, to enforce its rights against any and
all Property occupants or tenants. Purchaser agrees that the
departure, prior to Closing, of any of such occupants or tenants
shall not be the basis for, nor shall it give rise to, any claim on
the part of Purchaser, nor shall it affect the obligations of
Purchaser under this Purchase Contract in any manner whatsoever; and
Purchaser shall close title and accept delivery of the deed with or
without such tenants in possession and without any allowance or
reduction in the Purchase Price under this Purchase Contract.
Purchaser hereby releases Seller from any and all claims and
liabilities relating to the foregoing matters, except as provided in
Section 8.1.3 below.
8.1.3 Seller and Purchaser agree that those representations contained in
Section 8.1.1 shall survive Closing for a period of One (1) year
(that is, any proceeding based on the breach of a representation
contained in Section 8.1 that survives Closing must be commenced
within One (1) year subsequent to the date of such representation),
except for the representations contained in Sections 8.1.1.2 and
8.1.1.3, which shall not survive the Closing but shall be merged
into the deed, the assignment and the vendor's affidavit or
indemnity delivered at Closing pursuant to Sections 7.2.1.1.,
7.2.1.3 and 7.2.1.5. In the event that Seller breaches any
representation contained in Section 8.1.1 and Purchaser had
knowledge of such breach, however, Purchaser shall be deemed to have
waived any right of recovery and Seller shall not have any liability
in connection therewith.
8.1.4Any statement contained in the representations and warranties in
this Section 8.1 and made to the "knowledge" of Seller shall mean
ONLY the actual knowledge of Seller based upon the information
communicated to Seller by Nola Hartung-Dillingham, a representative
of the management company managing the Property as of the date of
this Purchase Contract, in a certification addressed to Seller and
dated as of the Effective Date; and otherwise any reference to the
"knowledge" of Seller shall not be deemed to imply any duty of
investigation or inquiry by Seller, and shall not be construed to
include the knowledge of any member, partner, officer, director,
agent, employee or representative of the Seller or any affiliate of
the Seller, imputed to Seller or constructively attributed to
Seller.
8.1.5 Covenants of Seller
8.1.5.1 Seller covenants that it will not voluntarily create or cause any
lien or encumbrance (other than Commercial Leases and Property
Contracts in the ordinary course of business) to attach to the
Property between the Effective Date and the Closing Date; any
such monetary lien or encumbrance so attaching by voluntary act
of Seller shall be discharged by the Seller at or prior to
Closing, on the Closing Date or any postponed Closing Date.
Except as expressly provided above, Seller shall not be required
to undertake efforts to remove any other lien, encumbrance,
security interest, exception, objection or other matter, to make
any expenditure of money or institute litigation or any other
judicial or administrative proceeding and Seller may elect not to
discharge the same.
8.1.5.2 Seller may enter into new commercial leases and new property
contracts in the ordinary course of business during the
Feasibility Period, providing Purchaser with Notice of any such
new commercial leases and new property contracts. Unless this
Purchase Contract is terminated as provided herein, upon the
expiration of the Feasibility Period, and Purchaser's acceptance
of the Property, Seller shall not, without the consent of
Purchaser (which consent will not be unreasonably withheld),
enter into any new commercial leases or property contracts
affecting the Property, or terminate or agree to terminate (other
than in the ordinary course of business pursuant to the terms and
conditions thereof) any Commercial Leases of more than five
thousand (5,000) square feet of Property. For purposes of this
Section 8.1.5.2, Purchaser's failure to respond to Seller's
written request for consent within five (5) business days shall
be deemed consent on the part of the Purchaser. All new leases
or contracts entered into in accordance with the provisions of
this Section 8.1.5.2 shall be deemed "Commercial Leases" and
"Property Contracts", respectively, as defined herein.
8.1.5.3 Seller shall continue to maintain the Property in the normal
course of business of Seller's business in substantially the same
condition as of the date of this Purchase Contract, ordinary wear
and tear and casualty excepted; provided, however, and
notwithstanding the preceding provisions, in no event shall
Seller be required to make any capital improvements to the
Property.
8.2 Representations And Warranties Of Purchaser
8.2.1 For the purpose of inducing Seller to enter into this Purchase
Contract and to consummate the sale and purchase of the Property in
accordance herewith, Purchaser represents and warrants to Seller the
following as of the Effective Date and as of the Closing Date:
8.2.2 With respect to Purchaser and its business, Purchaser represents and
warrants, in particular, that:
8.2.2.1 Purchaser is a limited partnership duly organized,
validly existing and in good standing under the laws of
California.
8.2.2.2 Purchaser, acting through any of its or their duly
empowered and authorized officers or members, has all
necessary power and authority to own and use its properties
and to transact the business in which it is engaged, and has
full power and authority to enter into this Purchase
Contract, to execute and deliver the documents and
instruments required of Purchaser herein, and to perform its
obligations hereunder; and no consent of any of Purchaser's
officers or members are required to so empower or authorize
Purchaser.
8.2.2.3 No pending or, to the knowledge of Purchaser,
threatened litigation exists which if determined adversely
would restrain the consummation of the transactions
contemplated by this Purchase Contract or would declare
illegal, invalid or non-binding any of Purchaser's
obligations or covenants to Seller.
8.2.2.4 Purchaser is duly authorized to execute and deliver,
acting through its duly empowered and authorized officers
and members, respectively, and perform this Purchase
Contract and all documents and instruments and transactions
contemplated hereby or incidental hereto, and such
execution, delivery and performance by Purchaser does not
(i) violate any of the provisions of their respective
certificates of incorporation or bylaws, (ii) violate any
provision of any law, governmental rule or regulation
currently in effect, (iii) violate any judgment, decree,
writ, injunction, award, determination or order currently in
effect that names or is specifically directed at Purchaser
or its property, and (iv) require the consent, approval,
order or authorization of, or any filing with or notice to,
any court or other governmental authority.
8.2.2.5 The joinder of no person or entity other than Purchaser
is necessary to consummate the transactions to be performed
by Purchaser and Purchaser has all necessary right and
authority to perform such acts as are required and
contemplated by this Purchase Contract.
8.2.3 Purchaser has not dealt with any broker, finder or any other person,
in connection with the purchase of or the negotiation of the
purchase of the Property that might give rise to any claim for
commission against Seller or lien or claim against the Property.
ARTICLE 9
CONDITIONS PRECEDENT TO CLOSING
9.1 Purchaser's obligation to close under this Purchase Contract, shall be
subject to and conditioned upon the fulfillment of each and all of the
following conditions precedent:
9.1.1 All of the documents required to be delivered by Seller to Purchaser
at Closing pursuant to the terms and conditions hereof shall have
been delivered and shall be in form and substance reasonably
satisfactory to Purchaser;
9.1.2 Each of the representations and warranties of Seller contained
herein shall be true in all material respects as of the Closing
Date;
9.1.3 Seller shall have complied with, fulfilled and performed in all
material respects each of the covenants, terms and conditions to be
complied with, fulfilled or performed by Seller hereunder;
9.1.4 Purchaser shall have received, on or prior to Closing, a fully
executed estoppel certificate from each Tenant of the Property in
the form of EXHIBIT 9.1.4 attached hereto ("Estoppel Certificate").
In the event Seller is unable to obtain an estoppel certificate from
any of the Tenants, Purchase shall accept an estoppel certificate
from Seller in substantially the form of EXHIBIT 9.1.4.
9.1.5 Notwithstanding anything to the contrary, there are no other
conditions on Purchaser's obligation to close except as expressly
set forth in this Purchase Contract.
9.2 Without limiting any of the rights of Seller elsewhere provided for in this
Purchase Contract, Seller's obligation to close with respect to conveyance
of a particular Property under this Purchase Contract shall be subject to
and conditioned upon the fulfillment of each and all of the following
conditions precedent:
9.2.1 Purchaser's representations and warranties set forth in this
Purchase Contract shall have been true and correct in all material
respects when made, and shall be true and correct in all material
respects on the Closing Date and as of the Effective Date as though
such representations and warranties were made at and as of such date
and time.
9.2.2 Purchaser shall have fully performed and complied with all
covenants, conditions, and other obligations in this Purchase
Contract to be performed or complied with by it at or prior to
Closing including, without limitation, payment in full of the
Purchase Price.
9.2.3 There shall not be pending or, to the knowledge of either Purchaser
or Seller, any litigation or threatened litigation which, if
determined adversely, would restrain the consummation of any of the
transactions contemplated by this Purchase Contract or declare
illegal, invalid or non-binding any of the covenants or obligations
of the Purchaser.
ARTICLE 10
BROKERAGE
10.1 Seller represents and warrants to Purchaser that it has dealt only with
Trammell Crow Company, 3570 Camino Del Rio North, Suite 100, San Diego,
California 92108 ("Seller's Broker") in connection with this Purchase
Contract. Seller and Purchaser each represents and warrants to the other
that other than Seller's Broker, it has not dealt with or utilized the
services of any other real estate broker, sales person or finder in
connection with this Purchase Contract, and each party agrees to indemnify
the other party from and against all claims for brokerage commissions and
finder's fees arising from or attributable to the acts of omissions of the
indemnifying party; provided, however, Purchaser discloses that the name
and address of Purchaser's broker is BRE, 4380 La Jolla Villa Dr., San
Diego, California ("Purchaser's Broker") and Purchaser shall pay to BRE any
commissions due it pursuant to a separate agreement between Purchaser and
BRE and indemnify Seller from and against all claims for brokerage
commissions and finder's fees arising from or attributable to the acts of
Purchaser's Broker.
10.2 Seller agrees to pay Seller's Broker a commission according to the terms of
a separate agreement. Seller's Broker shall not be deemed a party or third
party beneficiary of this Purchase Contract.
10.3 Seller's Broker assumes no responsibility for the condition of the Property
or representation for the performance of this Purchase Contract by the
Seller or Purchaser.
ARTICLE 11
POSSESSION
11.1 Possession of the Property subject to the Permitted Exceptions shall be
delivered to Purchaser at the Closing, subject to Purchaser's right of
entry for inspection as set forth in ARTICLE 5.
ARTICLE 12
DEFAULTS AND REMEDIES
12.1 In the event of any default of Purchaser resulting in the termination of
this Purchase Contract for any reason, Seller and Purchaser agree that it
would be impractical and extremely difficult to estimate the damages which
Seller may suffer. Therefore, Seller and Purchaser hereby agree that,
except for the Purchaser's obligations to Seller under Section 5.3, the
reasonable estimate of the total net detriment that Seller would suffer in
the event that Purchaser terminates this Purchase Contract or defaults
hereunder prior to the Closing Date is and shall be, as Seller's sole and
exclusive remedy (whether at law or in equity), the right to receive from
the Escrow Agent and retain the full amount of the Deposit. The payment
and performance of the above as liquidated damages is not intended as a
forfeiture or penalty within the meaning of applicable law and is intended
to settle all issues and questions about the amount of damages suffered by
Seller in the applicable event, except only for damages under Section 5.3
above, irrespective of the time when the inquiry about such damages may
take place. Upon any such failure by Purchaser hereunder, this Purchase
Contract shall be terminated, and neither party shall have any further
rights or obligations hereunder, each to the other, except for the
Purchaser's obligations to Seller under Section 5.3 above, and the right of
Seller to collect such liquidated damages to the extent not theretofore
paid by Purchaser.
12.2 Provided that Purchaser has not terminated this Purchase Contract and is
not otherwise in default hereunder, if the Closing does not occur as a
result of Seller's default hereunder, Purchaser's sole remedy shall be to
elect to terminate this Purchase Contract and receive reimbursement of the
Deposit (or so much thereof as has been received by Escrow Agent) or to
seek specific performance of this Purchase Contract.
ARTICLE 13
RISK OF LOSS OR CASUALTY
13.1 RISK OF LOSS OR CASUALTY. The risk of loss or damage to the Property by
fire or other casualty until the date of Closing is assumed by the Seller,
provided that the Seller's responsibility shall be only to the extent of
any recovery from insurance now carried on the Property. If any of the
Improvements shall be destroyed or damaged prior to the Closing, and the
estimated cost of repair or replacement exceeds Two Hundred Thousand and
No/100 Dollars ($200,000.00), Purchaser may, by written notice given to
Seller within fifteen (15) days after receipt of written notice from Seller
of such damage or destruction, elect to terminate this Purchase Contract,
in which event the Deposit shall immediately be returned by Escrow Agent to
Purchaser and except as expressly provided herein, subject to and except
for Purchaser's liability under Sections 5.3 and 5.4, the rights, duties,
obligations, and liabilities of all parties hereunder shall immediately
terminate and be of no further force or effect. If Purchaser does not
elect to terminate this Purchase Contract pursuant to this Section 13.1, or
has no right to terminate this Purchase Contract (because the damage or
destruction does not exceed $200,000.00), and the sale of the Property is
consummated, Purchaser shall be entitled to receive all insurance proceeds
paid or payable to Seller by reason of such destruction or damage under the
insurance policies carried by Seller (less amounts of insurance theretofore
received and applied by Seller to restoration); provided that in the event
the insurance proceeds, if any, shall be insufficient to defray the
estimated cost of repairing or replacing the damage or destruction, then,
to the extent the amount of the insufficiency shall exceed $25,000.00
(determined by reference to such estimated cost and Seller's statement of
the available insurance proceeds), the amount of the insufficiency may be
claimed by Purchaser, by Notice of such claim given to Seller prior to
Closing, as an additional adjustment at Closing pursuant to Section 7.1.3
above, provided further in such event that upon receipt of any such Notice
from Purchaser, Seller may elect, at its sole option, by so advising
Purchaser in writing at or prior to the Closing, to terminate this Purchase
Contract, in which event the Deposit shall be returned to Purchaser and
except as expressly provided herein, subject to and except for Purchaser's
liability under Section 5.3, the rights, duties, obligations and
liabilities of the parties hereunder shall immediately terminate and be of
no further force and effect. If the amount of said casualty proceeds is
not settled by the date of Closing, Seller shall execute at Closing all
proofs of loss, assignments of claim, and other similar instruments to
ensure that Purchaser shall receive all of Seller's right, title, and
interest in and under said insurance proceeds. Seller shall not, in any
event, be obligated to effect any repair, replacement, and/or restoration,
but may do so at its option in which case Seller may apply the insurance
proceeds to the costs of restoration. Seller shall reasonably cooperate
with Purchaser in providing all information concerning insurance coverages
and available insurance proceeds in the event of such damage or
destruction.
ARTICLE 14
EXECUTION
14.1 This Purchase Contract shall be null and void unless fully signed by
Purchaser and Seller on or before May 10, 1999.
ARTICLE 15
EMINENT DOMAIN
15.1 In the event that at the time of Closing all or any part of the Property is
(or has previously been) acquired, or is about to be acquired, by authority
of any governmental agency in purchase in lieu thereof (or in the event
that at such time there is any notice of any such acquisition by any such
governmental agency), Purchaser shall have the right, at Purchaser's
option, to terminate this Purchase Contract by giving written Notice within
Fifteen (15) days of the occurrence of such event and recover the Deposit
hereunder, or to settle in accordance with the terms of this Purchase
Contract for the full Purchase Price and receive the full benefit or any
condemnation award. It is expressly agreed between the parties hereto that
this paragraph shall in no way apply to customary dedications for public
purposes which may be necessary for the development of the Property.
ARTICLE 16
MISCELLANEOUS
16.1 EXHIBITS AND SCHEDULES
All Exhibits and Schedules annexed hereto are a part of this
Purchase Contract for all purposes.
16.2 ASSIGNABILITY
Except as provided in this Section, this Purchase Contract is not
assignable without first obtaining the prior written approval of the
non-assigning party. Purchaser may assign its rights under this
Purchase Contract and the Escrow to any entity or person owned or
controlled by Purchaser or to an intermediary or other person
required to carry out the exchange described in Section 16.18, upon
written notice to Seller and Escrow Agent and upon delivery of a
written assumption of all obligations of Purchaser under this
Purchase Contract signed by assignee and assignor, which shall agree
to be jointly and severally liable in all respects for the
obligations of Purchaser hereunder, provided (a) no such assignment
shall release or relieve Purchaser from its obligations under this
Purchase Contract, (b) no such assignment shall change, delay or
otherwise affect the Feasibility Period, the Closing Date or any
other time periods for Purchaser's performance under this Purchase
Contract, (c) no such assignment shall reinstate any rights or
entitlements waived by Purchaser prior to such assignment, and (d)
any such assignment shall be conclusively presumed to include an
assignment of any right of Purchaser to receive the Deposit if
subject to refund in accordance with this Purchase Contract.
16.3 BINDING EFFECT
This Purchase Contract shall be binding upon and inure to the
benefit of Seller and Purchaser, and their respective successors,
heirs and permitted assigns.
16.4 CAPTIONS
The captions, headings, and arrangements used in this Purchase
Contract are for convenience only and do not in any way affect,
limit, amplify, or modify the terms and provisions hereof.
16.5 NUMBER AND GENDER OF WORDS
Whenever herein the singular number is used, the same shall include
the plural where appropriate, and words of any gender shall include
each other gender where appropriate.
16.6 NOTICES
All Notices, demands, requests and other communications required
pursuant to the provisions of this Purchase Contract ("Notice")
shall be in writing and shall be deemed to have been properly given
or served for all purposes (i) if sent by Federal Express or a
nationally recognized overnight carrier for next Business Day
delivery, on the first business day following deposit of such Notice
with such carrier, or (ii) if personally delivered, on the actual
date of delivery or (iii) if sent by certified mail, return receipt
requested postage prepaid, on the Fifth (5th) business day following
the date of mailing addressed as follows:
If to Seller: If to Purchaser:
Consolidated Capital Eastgate Technology Partners
Institutional Properties/3
c/o AIMCO Attn: Jeffrey C. Hamann
1873 South Bellaire Street 475 West Bradley Avenue
Suite 1700 El Cajon, CA 92020
Denver, CO 80222
Attn: Tim Works, Harry Alcock,
Martha Carlin
Phone: 303-691-4357
and with copies to: and with a copy to:
Argent Real Estate James W. Meisenheimer, Esq.
Attn: David Marquette Meisenheimer, Herron & Steele,
1401 Brickell Avenue P.C.
Suite 520 550 West C Street
Miami, FL 33131 Suite 1760
Phone: 305-371-9299 San Diego, California 92101-
Fax: 305-371-6898 3545
Phone: 619-233-4122
Fax: 619-233-3709
and:
Richard A. Cohn, Esquire
Bryan Cave LLP
700 Thirteenth Street, N.W.
Washington, D.C. 20005-3960
Phone: 202-508-6000
Fax: 202-508-6200
and:
David M. Unseth, Esquire
Bryan Cave LLP
One Metropolitan Square
Suite 3600
St. Louis, MO 63102-2750
Phone: 314-259-2000
Fax: 314-259-2020
Any of the parties may designate a change of address by Notice in
writing to the other parties. Whenever in this Purchase Contract
the giving of Notice by mail or otherwise is required, the giving of
such Notice may be waived in writing by the person or persons
entitled to receive such Notice.
16.7 GOVERNING LAW AND VENUE
The laws of the State of California shall govern the validity,
construction, enforcement, and interpretation of this Purchase
Contract, unless otherwise specified herein except for the conflict
of laws provisions thereof. All claims, disputes and other matters
in question arising out of or relating to this Purchase Contract, or
the breach thereof, shall be decided by proceedings instituted and
litigated in the United States District Court for the district in
which the Property is situated, and the parties hereto expressly
consent to the venue and jurisdiction of such court.
16.8 ENTIRETY AND AMENDMENTS
This Purchase Contract embodies the entire Purchase Contract between
the parties and supersedes all prior Purchase Contracts and
understandings, if any, relating to the Property, and may be amended
or supplemented only by an instrument in writing executed by the
party against whom enforcement is sought.
16.9 SEVERABILITY
If any of the provisions of this Purchase Contract is held to be
illegal, invalid, or unenforceable under present or future laws,
such provision shall be fully severable. The Purchase Contract
shall be construed and enforced as if such illegal, invalid, or
unenforceable provision had never comprised a part of this Purchase
Contract; and the remaining provisions of this Purchase Contract
shall remain in full force and effect and shall not be affected by
the illegal, invalid, or unenforceable provision or by its severance
from this Purchase Contract. In lieu of such illegal, invalid, or
unenforceable provision, there shall be added automatically as a
part of this Purchase Contract a provision as similar in terms to
such illegal, invalid, or unenforceable provision as may be possible
to make such provision legal, valid, and enforceable.
16.10 MULTIPLE COUNTERPARTS
This Purchase Contract may be executed in a number of identical
counterparts. If so executed, each of such counterparts is to be
deemed an original for all purposes and all such counterparts shall,
collectively, constitute one Purchase Contract. In making proof of
this Purchase Contract, it shall not be necessary to produce or
account for more than one such counterparts.
16.11 FURTHER ACTS
In addition to the acts and deeds recited herein and contemplated
and performed, executed and/or delivered by Seller and Purchaser,
Seller and Purchaser agree to perform, execute and/or deliver or
cause to be performed, executed and/or delivered any and all such
further acts, deeds, and assurances as may be necessary to
consummate the transactions contemplated hereby.
16.12 CONSTRUCTION
No provision of this Purchase Contract shall be construed in favor
of, or against, any particular party by reason of any presumption
with respect to the drafting of this Purchase Contract; both
parties, being represented by counsel, having fully participated in
the negotiation of this instrument.
16.13 CONFIDENTIALITY
Purchaser shall not disclose the terms and conditions contained in
this Purchase Contract, shall keep the same confidential, provided
that Purchaser may disclose the terms and conditions of this
Purchase Contract (i) as required by law, (ii) to consummate the
terms of this Purchase Contract, or any financing relating thereto,
or (iii) to Purchaser's or Seller's lenders, attorneys and
accountants. Any information provided by Seller to Purchaser under
the terms of this Purchase Contract is for informational purposes
only. In providing such information to Purchaser, Seller makes no
representation or warranty, express, written, oral, statutory, or
implied, and all such representations and warranties are hereby
expressly excluded. Purchaser shall not in any way be entitled to
rely upon the accuracy of such information. Such information is
also confidential and Purchaser shall be prohibited from making such
information public to any other person or entity other than its
agents and legal representatives, without Seller's prior written
authorization, which may be granted or denied in Seller's sole
discretion.
16.14 TIME OF THE ESSENCE
It is expressly agreed by the parties hereto that time is of the
essence with respect to this Purchase Contract.
16.15 CUMULATIVE REMEDIES AND WAIVER
Except as otherwise provided herein, no remedy herein conferred or
reserved is intended to be exclusive of any other available remedy
or remedies, but each and every such remedy shall be cumulative and
shall be in addition to every other remedy given under this Purchase
Contract or now or hereafter existing at law or in equity. No delay
or omission to exercise any right or power accruing upon any
default, omission, or failure of performance hereunder shall impair
any right or power or shall be construed to be a waiver thereof, but
any such right and power may be exercised from time to time and as
often as may be deemed expedient. No waiver, amendment, release, or
modification of this Purchase Contract shall be established by
conduct, custom, or course of dealing.
16.16 LITIGATION EXPENSES
In the event either party hereto commences litigation against the
other to enforce its rights hereunder, the prevailing party in such
litigation shall be entitled to recover from the other party its
reasonable attorneys' fees and expenses incidental to such
litigation.
16.17 TIME PERIODS
Should the last day of a time period fall on a weekend or legal
holiday, the next Business Day thereafter shall be considered the
end of the time period.
16.18 EXCHANGE
16.18.1 At Seller's sole cost and expense, Seller may structure the sale
of the Property to Purchaser as a Like Kind Exchange under Internal
Revenue Code Section 1031 whereby Seller will acquire certain
property (the "Like Kind Exchange Property") in conjunction with the
sale of the Property (the "Like Kind Exchange"). Purchaser shall
cooperate fully and promptly with Seller's conduct of the Like Kind
Exchange, provided that all costs and expenses generated in
connection with the Like Kind Exchange shall be borne solely by
Seller, and Purchaser shall not be required to take title to or
contract for the purchase of any other property. If Seller uses a
qualified intermediary to effectuate the exchange, any assignment of
the rights or obligations of Seller hereunder shall not relieve,
release or absolve Seller of its obligations to Purchaser. In no
event shall the Closing Date be delayed by the Like Kind Exchange.
Seller shall indemnify and hold harmless Purchaser from and against
any and all liability arising from and out of the Like Kind
Exchange.
16.18.2 At Purchaser's sole cost and expense, Purchaser may structure the
purchase of the Property by Purchaser as a Like Kind Exchange under
Internal Revenue Code Section 1031 whereby Purchaser will acquire
certain property (the "Purchaser Like Kind Exchange Property") in
conjunction with the sale of the Property (the "Purchaser Like Kind
Exchange"). Seller shall cooperate fully and promptly with
Purchaser's conduct of the Purchaser Like Kind Exchange, provided
that all costs and expenses generated in connection with the
Purchaser Like Kind Exchange shall be borne solely by Purchaser, and
Seller shall not be required to take title to or contract for the
purchase of any other property. If Purchaser uses a qualified
intermediary to effectuate the exchange, any assignment of the
rights or obligations of Purchaser hereunder shall not relieve,
release or absolve Purchaser of its obligations to Seller. In no
event shall the Closing Date be delayed by the Purchaser Like Kind
Exchange. Purchaser shall indemnify and hold harmless Seller from
and against any and all liability arising from and out of the
Purchaser Like Kind Exchange.
NOW WHEREFORE, the parties hereto have executed this Purchase Contract as of the
date first set forth above.
Seller: CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES/3, a California limited
partnership
By:
Printed:
Title:
Purchaser: EASTGATE TECHNOLOGY PARTNERS L.P., a California limited
partnership
By: HAMANN CONSOLIDATED, INC.,
a California corporation,
General Partner
By: [SEAL]
Printed:
Title:
EXHIBIT 10.43
FIRST AMENDMENT TO PURCHASE CONTRACT
This FIRST AMENDMENT TO PURCHASE CONTRACT, made and entered into as of
the ____ day of May, 1999, by and between EASTGATE TECHNOLOGY PARTNERS, L.P., a
California limited partnership, having a principal address at 475 W. Bradley
Avenue, El Cajon, CA 92020 ("Purchaser"), and CONSOLIDATED CAPITAL INSTITUTIONAL
PROPERTIES/3, a California limited partnership, having a principal address at
c/o AIMCO, 1873 South Bellaire Street, Suite 1700, Denver, CO 80222 ("Seller").
WITNESSETH:
WHEREAS, Purchaser and Seller entered into a certain Purchase and Sale
Contract dated April 30, 1999, providing for the sale of a certain parcel of
real estate therein described located in the County of San Diego, State of
California (the "Purchase Contract"); and
WHEREAS, Purchaser and Seller now wish to amend the Purchase Contract
as provided in this First Amendment thereto.
NOW THEREFORE, for and in consideration of the foregoing and the
mutual covenants hereof, the parties hereto hereby stipulate, covenant and agree
as follows:
1. The term of the Feasibility Period set forth in Section 5.1 of the Purchase
Contract shall be extended until June 7, 1999.
2. Except as hereby amended, the Purchase Contract shall remain in full force
and effect, and is hereby ratified and confirmed.
[Remainder of page intentionally left blank]
IN WITNESS WHEREOF, the undersigned have executed this First Amendment
to Purchase Contract as of the day and year first written above.
Seller: CONSOLIDATED CAPITAL INSTITUTIONAL
PROPERTIES/3, a California limited partnership
By:
Printed:
Title:
Purchaser: EASTGATE TECHNOLOGY PARTNERS L.P., a
California limited partnership
By: HAMANN CONSOLIDATED, INC.,
a California corporation,
General Partner
By: [SEAL]
Printed:
Title:
