SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities and Exchange Act of 1934
Date of Report (Date of earliest event reported) May 14, 1999
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PaineWebber Equity Partners Two Limited Partnership
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(Exact name of registrant as specified in its charter)
Virginia 0-15705 04-2918819
- --------------------------------------------------------------------------------
(State or other jurisdiction) (Commission (IRS Employer
of incorporation File Number) Identification No.)
265 Franklin Street, Boston, Massachusetts 02110
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (617) 439-8118
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(Former name or address, if changed since last report)
<PAGE>
FORM 8-K
CURRENT REPORT
PAINEWEBBER EQUITY PARTNERS TWO LIMITED PARTNERSHIP
ITEM 2 - Disposition of Assets
West Ashley Shoppes - Charleston, South Carolina
Disposition Date - May 14, 1999
On May 14, 1999, West Ashley Shoppes Associates, a joint venture in which
PaineWebber Equity Partners Two Limited Partnership ("the Partnership") has an
interest, sold the property known as West Ashley Shoppes located in Charleston,
South Carolina, to an unrelated third party for $8.1 million. In addition, on
May 12, 1999, West Ashley Shoppes Associates sold an adjacent outparcel of land
to another unrelated third party for $280,000. The May 14 transaction involved
the remaining real estate owned by the joint venture. Accordingly, the joint
venture will be liquidated once the final operating expenses have been paid and
the remaining net cash assets have been distributed to the Partnership. The
Partnership received total net proceeds from the two sale transactions of
approximately $8,070,000 after deducting closing costs of approximately $225,000
and net closing proration adjustments of approximately $85,000. The Partnership
plans to distribute the net proceeds of the West Ashley Shoppes sale
transactions to the Limited Partners in the form of a special distribution in
the amount of approximately $60 per original $1,000 investment to be paid on or
before June 15, 1999.
As previously reported, with a strong occupancy level and a stable base of
tenants, the Partnership believed it was the opportune time to sell West Ashley
Shoppes. As part of a plan to market the property for sale, the Partnership
selected a national real estate firm that is a leading seller of this property
type. Preliminary sales materials were prepared and initial marketing efforts
were undertaken. A marketing package was then finalized and comprehensive sale
efforts began in November 1998. As a result of these efforts, ten offers were
received. After completing an evaluation of those offers and the relative
strength of the prospective purchasers, the Partnership selected an offer. A
purchase and sale agreement was negotiated with an unrelated third-party
prospective buyer and a non-refundable deposit of $150,000 was made on January
29, 1999. This prospective buyer completed its due diligence review work and the
transaction closed on May 14, 1999, as described above.
As discussed further in the Partnership's most recent Annual Report on
Form 10-K and Quarterly Reports on Form 10-Q, management has been focusing on
potential disposition strategies for the remaining investments in the
Partnership's portfolio. Subsequent to the sale of West Ashley Shoppes, the
remaining investments consist of joint venture interests in the Gateway Plaza
Shopping Center and the 625 North Michigan Office Building. Although there are
no assurances, it is currently contemplated that sales of the Partnership's
remaining assets, which would be followed by a liquidation of the Partnership,
could be completed by the end of calendar year 1999.
ITEM 7 - Financial Statements and Exhibits
(a) Financial Statements: None
(b) Exhibits:
(1) Amended and Restated Purchase and Sale Agreement by and between West
Ashley Shoppes Associates and Anbil II Corp, dated February 26, 1999.
(2) First Amendment To Amended and Restated Purchase and Sale Agreement by and
between West Ashley Shoppes Associates and Anbil II Corp, dated March 15,
1999.
(3) Assignment of Contract with Acceptance and Assumption by Anbil II Corp.
unto West Ashley Shoppes LLC, dated April 28, 1999.
(4) General Warranty Deed by West Ashley Shoppes Associates to West Ashley
Shoppes LLC, dated May 14, 1999.
(5) Assignment of Leases and Security Deposits by and between West Ashley
Shoppes Associates and West Ashley Shoppes LLC, dated May 14, 1999.
(6) Assignment and Assumption of Contracts Intangibles by and between West
Ashley Shoppes Associates and West Ashley Shoppes LLC, dated May 14, 1999.
(7) Settlement Statement between West Ashley Shoppes Associates and West
Ashley Shoppes LLC, dated May 14, 1999.
(8) Purchase and Sale Agreement by and between West Ashley Shoppes Associates
and Kelly and Cohen Appliances, Inc., dated February 2, 1999.
(9) Settlement Statement between Kelly and Cohen Appliances and West Ashley
Shoppes Associates, dated May 12, 1999.
<PAGE>
FORM 8-K
CURRENT REPORT
PAINEWEBBER EQUITY PARTNERS TWO LIMITED PARTNERSHIP
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
PAINEWEBBER EQUITY PARTNERS
TWO LIMITED PARTNERSHIP
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(Registrant)
By: Second Equity Partners, Inc.
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Managing General Partner
By: /s/ Walter V. Arnold
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Walter V. Arnold
Senior Vice President and
Chief Financial Officer
Date: May 25, 1999
<PAGE>
AMENDED AND RESTATED
PURCHASE AND SALE AGREEMENT
BY AND BETWEEN
WEST ASHLEY SHOPPES ASSOCIATES (SELLER)
AND
ANBIL II CORP. (BUYER)
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE 1 DEFINITIONS 1
ARTICLE 2 PURCHASE AND SALE 2
ARTICLE 3 PURCHASE PRICE, DEPOSIT AND ADJUSTMENTS 2
ARTICLE 4 PRECLOSING OPERATION 4
ARTICLE 5 ACCESS, INSPECTION, DILIGENCE AND MORTGAGE
CONTINGENCY 6
ARTICLE 6 TITLE, SURVEY, CONDITIONS AND REPRESENTATIONS 9
ARTICLE 7 CLOSING 13
ARTICLE 8 CASUALTY AND CONDEMNATION 14
ARTICLE 9 BROKERAGE COMMISSIONS 15
ARTICLE 10 DEFAULT, TERMINATION AND REMEDIES 16
ARTICLE 11 MISCELLANEOUS 16
ARTICLE 12 IRS FORM 1099-S DESIGNATION 21
SCHEDULE A Legal Description of the Real Property
SCHEDULE B Description of Personal Property and Intangible Property
SCHEDULE C Rent Roll
SCHEDULE D 1099 Designation Agreement
SCHEDULE E Form of Tenant Estoppel Certificate
SCHEDULE F List of Escrow Provisions
SCHEDULE G Form of General Warranty Deed
SCHEDULE H Form of Bill of Sale
SCHEDULE I Form of Assignment and Assumption of Leases
SCHEDULE J Form of Assignment and Assumption of Contracts and Intangibles
SCHEDULE K Form of Certificate of Non-Foreign Status
SCHEDULE L Insurance Certificate
SCHEDULE M Form of Subordination, Non-disturbance and Attornment Agreement
<PAGE>
AMENDED AND RESTATED PURCHASE AND SALE AGREEMENT
This Amended and Restated Purchase and Sale Agreement (this Agreement) is
entered into as of the 26th day of February, 1999 by and between Seller and
Buyer, upon the following terms and conditions:
WHEREAS, Buyer and Seller are parties to that certain Purchase and Sale
Agreement dated February 2, 1999 (the February 2, 1999 P&S); and
WHEREAS, the parties hereto now desire to amend and restate the February
2, 1999 P&S in its entirety.
NOW, THEREFORE, in consideration of and in reliance upon the above
Recitals, the terms, covenants and conditions contained in this Agreement and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, Buyer and Seller agree as follows:
ARTICLE 1
DEFINITIONS
References in this Agreement to the following terms shall have the
following meanings:
BUYER: ANBIL II Corp., a Texas corporation
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SELLER: West Ashley Shoppes Associates, a South Carolina
- ------ general partnership
PROPERTY: The Real Property and Personal Property constituting
- -------- West Ashley Shopping Center, Charleston, South Carolina
REAL PROPERTY: The land and the buildings, structures, improvements and
- ------------- fixtures (collectively, the Improvements) now located
thereon and the rights appurtenant thereto, all as more
particularly described in Schedule A attached hereto
PERSONAL PROPERTY: The personal and intangible property, if any, described
- ----------------- in Schedule B attached hereto
PURCHASE PRICE: $8,100,000.00
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TITLE COMPANY: First American Title Insurance Company of New York
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ARTICLE 2
PURCHASE AND SALE
2.1 In consideration of the undertakings and mutual covenants of the
parties set forth in this Agreement and for other good and valuable
consideration, the receipt and legal sufficiency of which are hereby
acknowledged, Seller hereby agrees to sell and convey the Property to Buyer and
Buyer hereby agrees to buy and pay the Purchase Price for the Property on the
terms and conditions contained herein. Buyer and Seller hereby acknowledge and
agree that this Agreement amends and restates in its entirety the February 2,
1999 P&S which the parties hereby agree is superseded hereby and of no further
force and effect.
ARTICLE 3
PURCHASE PRICE, DEPOSIT AND ADJUSTMENTS
3.1 The Purchase Price shall be as specified in Article 1 above and shall
be paid on the Closing Date (as hereinafter defined) by wire transfer of
immediately available federal funds, subject to adjustment to reflect
application of the Escrowed Amount (as hereinafter defined) and such other
adjustments herein contained.
3.2 Buyer has deposited with the Title Company the sum of One Hundred
Fifty Thousand Dollars ($150,000.00) (the Deposit). The Deposit is referred to
in this Agreement as the Escrowed Amount to secure Buyer's obligations under
this Agreement. The Escrowed Amount shall be held by the Title Company in escrow
in a federally-insured interest bearing account pursuant to the terms of this
Agreement and pursuant to the terms of the Escrow Provisions contained in
Schedule F attached hereto and made a part hereof. Upon consummation of the
purchase and sale contemplated in this Agreement, all interest earned on the
Escrowed Amount shall be credited against the balance of the Purchase Price due
on the Closing Date (as hereinafter defined). Additionally, concurrently with
the execution of this Agreement, Buyer shall deliver to Seller the sum of One
Hundred Dollars ($100.00) (the Inspection Fee) as consideration for Buyer's
information review and property inspection rights set forth herein. The
Inspection Fee shall remain the property of Seller in all instances.
3.3 All real estate taxes, assessments, special taxes, special assessments
and any other tax or assessment attributable to the Property through the Closing
Date shall be prorated and adjusted as of the Closing Date unless such items are
paid directly by tenants to the applicable taxing authority, in which case no
adjustment or proration shall be made for the items paid directly by the
tenants. If the tax statements for the fiscal year during which the Closing Date
occurs are not finally determined, then the tax figures for the immediately
prior fiscal year shall be used for the purposes of prorating taxes on the
Closing Date. Any tax refunds or proceeds (including interest thereon) on
account of a favorable determination resulting from a challenge, protest, appeal
or similar proceeding relating to taxes and assessments relating to the Property
(i) for all tax periods occurring prior to the applicable tax period in which
the Closing occurs shall be retained by and paid exclusively to Seller and (ii)
for the applicable tax period in which the Closing occurs shall be prorated as
of the Closing Date after reimbursement to Seller and Buyer, as applicable, for
all fees, costs and expenses (including reasonable attorneys and consultants
fees) incurred by Seller or Buyer, as applicable, in connection with such
proceedings such that Seller shall retain and be paid that portion of such tax
refunds or proceeds after such reimbursement as is applicable to the portion of
the applicable tax period prior to the Closing Date and Buyer shall retain and
be paid that portion of such tax refunds or proceeds as is applicable to the
portion of the applicable tax period from and after the Closing Date. Neither
Seller nor Buyer shall settle any tax protests or proceedings in which taxes for
the tax period for which the other party is responsible are being adjudicated
without the consent of such party, which consent should shall not be
unreasonably withheld, conditioned or delayed. Buyer and Seller shall cooperate
in pursuit of any such proceedings and in responding to reasonable requests of
the other for information concerning the status of and otherwise relating to
such proceedings; provided, however, that neither party shall be obligated to
incur any out-of-pocket fees, costs or expenses in responding to the requests of
the other. In no event shall any such proceeding be commenced by Seller
following the Closing Date without Buyer's prior written consent.
3.4 Prepaid or past due amounts under any Contracts (as defined in Section
5.2 below) which are assigned to Buyer at Closing shall be prorated and adjusted
as of the Closing Date.
3.5 Seller shall cause all meters for electricity, gas, water, sewer or
other utility usage at the Property to be read on the Closing Date, and Seller
shall pay all charges for such utilities which have accrued on or prior to the
Closing Date; provided, however, that if and to the extent such charges are paid
directly by tenants, no such reading or payment shall be required. If the
utility companies are unable or refuse to read meters for which payment by
Seller is required, all charges for such utilities to the extent unpaid shall be
prorated and adjusted as of the Closing Date based on the most recent bills
therefor. Seller shall provide notice to Buyer within five (5) days before the
Closing Date setting forth (i) whether utility meters will be read as of the
Closing Date and (ii) a copy of the most recent bill for any utility charges
which are to be prorated and adjusted as of the Closing Date. If the meters
cannot be read as of the Closing Date and, therefore, the most recent bill is
used to prorate and adjust as of the Closing Date, then to the extent that the
amount of such prior bill proves to be more or less than the actual charges for
the period in question, a further adjustment shall be made after the Closing
Date as soon as the actual charges for such utilities are available.
3.6 Collected rents for the then current period; security deposits which
have not been previously applied by Seller; prepaid rentals; collected or
prepaid common area maintenance charges; collected or prepaid promotional
charges; collected or prepaid service charges; collected or prepaid tax charges,
and all other collected or prepaid incidental expenses and charges paid by
tenants shall be apportioned and full value shall be adjusted as of the Closing
Date, and the net amount thereof, if in favor of Seller, shall be added to the
Purchase Price, or if in favor of Buyer, shall be deducted from the Purchase
Price. From and after Closing all security deposits credited to Buyer shall
thereafter be deemed transferred to Buyer and Buyer shall assume and be solely
responsible for the payments of security deposits (for which Buyer was credited
at Closing) to tenants in accordance with the Leases (as hereinafter defined)
and applicable law. Seller shall be entitled to retain and/or receive a credit
for any utility deposits and any deposits for third parties under any of the
Contracts (as hereinafter defined).
3.6.1 All rentals and other tenant charges payable in arrears and
uncollected and all other uncollected rents (including, but not limited
to, percentage rents, common area maintenance charges and real estate tax
charge annual adjustments thereto) for the current and prior rental
periods, less the reasonable expenses of collection thereof, shall be
apportioned (if and when collected by either party). Buyer shall first
apply rents subsequently received to rent due and owing for rental periods
accruing after the Closing Date. Buyer shall not settle or release (i)
tenants from any obligations for such uncollected rents or (ii) rights
under any claims listed in Section 3.6.2 below, in each case, without
Seller's prior written approval, which approval shall not be unreasonably
withheld or delayed.
3.6.2 Seller shall retain all rights to all refunds, receivables,
past due rent and claims, including, but not limited to, termination fees
or damages from all former tenants or occupants of the Property which are
not listed on the Rent Roll, causes of action and rights of reimbursement
from third parties, bonds, accounts receivable and any other claims for
payments Seller may have to the extent arising or relating to the period
prior to the Closing.
3.6.3 In the event, on the Closing Date, the precise figures
necessary for any of the foregoing adjustments are not capable of
determination, then, at Buyer's option, those adjustments shall be made
either (i) on the basis of good faith estimates of Seller and Buyer using
currently available information, and final adjustments shall be made
promptly after precise figures are determined or available or (ii) when
all information for all final adjustments are determined or available.
3.7 At the Closing, Seller shall pay the amount due for (a) state and
county transfer tax (or any tax substituted therefor) imposed in connection with
the consummation of the transaction contemplated hereby (the Transfer Tax); (b)
recording charges for documents to clear title, evidence Seller's authority or
enable Seller to convey; and (c) Seller's attorney's fees.
3.8 At the Closing, Buyer shall pay for (a) any local tax or mortgage tax
other than the Transfer Tax; (b) charges to record the deed, and evidence of
Buyer's existence or authority; (c) survey charges; (d) Buyer's attorney's fees
and all costs related to Buyer's due diligence; (e) the cost of the standard
owners title insurance policy referred to in Article 6, below; and (f) costs as
to additional title insurance coverages or endorsements, including the cost of a
new lenders title policy.
3.9 The provisions of this Article 3 shall survive the Closing.
3.10 Buyer shall pay all brokerage commissions and tenant improvements, if
any, for the lease with Countrywide Home and the lease extension with One Way
Eyeglasses.
ARTICLE 4
PRECLOSING OPERATION
4.1 A rent roll prepared by Seller's property manager (the Rent Roll)
containing a list of all current occupants of the Property is attached hereto as
Schedule C. The leases listed on the Rent Roll, together with leases entered
into pursuant to this Article 4 are collectively referred to herein as the
Leases.
4.2 Seller shall not, after the date hereof; (i) enter into any new Leases
or materially amend or terminate any existing Leases, (ii) enter into or modify
any service contracts, operating agreements, or reciprocal easement agreements,
(iii) alter the zoning classification of the Property or (iv) materially alter
any Improvements, without the written consent of Buyer in any such instance,
which consent shall not be unreasonably withheld or delayed. If Buyer does not
notify Seller in writing of its denial of consent within ten (10) Business Days
(as hereinafter defined) after written request therefor is received from Seller,
Buyer shall be deemed to have consented to such requested action. In the event
Buyer denies its consent, Buyer shall specify its reasons for denial in its
written notice thereof. In the event Seller's requested action with respect to a
Lease is consented to or deemed consented to by Buyer, Buyer shall pay for
tenant improvements and leasing commissions as disclosed on Seller's request for
consent on the Closing Date. Without limiting any of the provisions contained
herein, Buyer shall assume the current outstanding balance of free rent due to
Waccamaw Corporation pursuant to that certain lease dated October 31, 1997 by
and between Seller and Waccamaw Corporation.
4.3 At all times prior to Closing, Seller shall continue (a) to conduct
business with respect to the Property in the same manner in which said business
has been heretofore conducted and (b) to insure the Property substantially as
currently insured, as evidenced by the insurance certificate attached hereto as
Schedule L.
4.4 Buyer shall, by written notice to Seller, on or before the Diligence
Date, identify any Contracts (as defined in Section 5.2 below) which it elects
to have terminated. Buyer shall be deemed to have elected to assume any
Contracts which are not identified as to be terminated. Seller shall terminate
any Contracts at Closing which are identified by Buyer as specified in this
section as Contracts to be terminated at Closing, provided that such Contracts
may be terminated without liability to Seller and provided that such Contracts
are terminable on not more than sixty (60) days notice. Seller shall pay any
cancellation costs incurred therewith.
4.5 Seller shall (i) obtain tenant estoppel certificates which do not list
any monetary defaults from Waccamaw Corporation, Phar-Mor, Inc. and such other
tenants as are required so that such certificates are received from tenants
occupying at least 112,000 square feet at the Property, and (ii) use
commercially reasonable efforts to obtain tenant estoppel certificates, from all
other tenants currently occupying their space under its respective Lease, in
each case, in the form attached hereto as Schedule E, in the form attached to or
required pursuant to such Lease, if any, or in such other form as Buyer's lender
may reasonably require, provided, however that such other form will be delivered
to Seller from Buyer as soon as possible so that any such form may be agreed
upon on or before March 15, 1999. Seller shall not be obligated to expend more
than nominal funds or commence litigation in pursuit of such estoppel
certificates. Receipt of such estoppel certificates described in clause (i)
above shall be a condition precedent to Closing, however, receipt of such
certificates described in clause (ii) above shall not be a condition precedent
to Closing except as otherwise provided in Section 6.5.
4.6 Seller shall use reasonable efforts to obtain subordination,
non-disturbance and attornment agreements from all tenants currently occupying
space under a Lease in the form attached hereto as Schedule M or in such other
form as Buyer's lender may reasonably require, provided, however that such other
form will be delivered to Seller from Buyer as soon as possible so that any such
form may be agreed upon on or before March 15, 1999.
ARTICLE 5
ACCESS, INSPECTION, DILIGENCE AND MORTGAGE CONTINGENCY
5.1 Seller agrees that Buyer and its authorized agents or representatives
shall be entitled to enter upon the Real Property and the Improvements during
normal business hours after one (1) day advance written notice to Seller (in
each case subject to the rights of tenants under the Leases) to make such
reasonable investigations, studies, and tests as Buyer deems necessary or
advisable; provided, however, that Buyer shall not be permitted to conduct
physical testing or conduct interviews with tenants without Seller's prior
written approval, which approval shall not be unreasonably withheld, conditioned
or delayed. Seller shall use its commercially reasonable efforts to make its
personnel available for such inspections or interviews upon one (1) day prior
written notice. Seller's prior written approval for physical inspections may be
conditioned on receipt of a detailed description of the proposed physical
inspection, a list of the contractors who will be performing the physical
inspection, evidence of insurance satisfactory to Seller, and such other
information as Seller reasonably requires in connection with such proposed
inspection. Buyer may not interview tenants unless a duly authorized
representative of Seller accompanies Buyer. Seller also agrees to make available
to Buyer during normal business hours upon advance written notice to Seller all
books, records, plans, building specifications, contracts, agreements or other
instruments or documents contained in Seller's files relating to the
construction, operation and maintenance of the Property and the files of the
current manager of the Property that relate to the Property.
5.2 Seller has provided Buyer with copies of all (i) Leases, (ii) all
maintenance, service, supply, equipment rental, management and leasing contracts
affecting the Property (collectively, the Contracts) which it has in its files
and its property manager has made such Leases and Contracts available to Buyer
for inspection, and (iii) such other information and reports affecting the
Property to the extent in Seller's possession or control.
Buyer acknowledges and agrees that any and all information, documents,
surveys, studies add reports provided to Buyer are provided for informational
purposes only and do not constitute representations and warranties of Seller of
any kind.
5.3 Buyer has completed its due diligence, other than as provided in
Section 6.1 below, and such due diligence did not reveal any matters which are
not acceptable to Buyer in Buyer's sole and absolute discretion.
Buyer acknowledges that it had an opportunity to conduct diligence on the
Property and is acquiring the Property in its current condition based on its
diligence. Buyer further acknowledges that neither Seller nor its employees,
agents or representatives have made any representation or warranty as to the
condition of the Property or the presence or absence of any hazardous materials
on, in, under or within the Property or a portion thereof which survive the
Closing hereunder except as expressly provided in this Agreement. THE BUYER
ACKNOWLEDGES AND AGREES THAT THE PROPERTY IS TO BE CONVEYED BY SELLER TO BUYER
AS IS, WITH ALL FAULTS, AND SUBSTANTIALLY IN ITS CURRENT CONDITION. BUYER
FURTHER ACKNOWLEDGES AND AGREES THAT, EXCEPT AS EXPRESSLY CONTAINED IN THIS
AGREEMENT, NEITHER SELLER NOR ANY AGENT, EMPLOYEE OR OTHER REPRESENTATIVE OF
SELLER (OR PURPORTED AGENT, EMPLOYEE OR OTHER REPRESENTATIVE OF SELLER) HAS MADE
ANY GUARANTEE, REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED (AND SELLER SHALL
NOT HAVE ANY LIABILITY WHATSOEVER) AS TO THE VALUE, USES, HABITABILITY,
CONDITION, DESIGN, OPERATION, FINANCIAL CONDITION OR PROSPECTS, OR FITNESS FOR
PURPOSE OR USE OF THE PROPERTY (OR ANY PART THEREOF) OR THE INFORMATION
MATERIALS NOT PREPARED BY SELLER, OR ANY OTHER GUARANTEE, REPRESENTATION OR
WARRANTY WHATSOEVER, EXPRESS OR IMPLIED, WITH RESPECT TO ANY PORTION OF THE
PROPERTY (OR ANY PART THEREOF) OR THE INFORMATION MATERIALS SUPPLIED TO BUYER.
FURTHER, SELLER SHALL HAVE NO LIABILITY FOR ANY LATENT, HIDDEN, OR PATENT DEFECT
AS TO THE PROPERTY OR THE FAILURE OF THE PROPERTY, OR ANY PART THEREOF, TO
COMPLY WITH ANY APPLICABLE LAWS AND REGULATIONS. IN PARTICULAR, BUYER
ACKNOWLEDGES AND AGREES THAT THE INFORMATION MATERIALS PROVIDED UNDER THIS
AGREEMENT (AND ANY OTHER INFORMATION BUYER MAY HAVE OBTAINED REGARDING IN ANY
WAY ANY OF THE PROPERTY, INCLUDING WITHOUT LIMITATION, ITS OPERATIONS OR ITS
FINANCIAL HISTORY OR PROSPECTS FROM SELLER OR ITS AGENTS, EMPLOYEES OR OTHER
REPRESENTATIVES BUT NOT INCLUDING INFORMATION PREPARED BY SELLER) IS DELIVERED
TO BUYER AS A COURTESY, WITHOUT REPRESENTATION OR WARRANTY AS TO ITS ACCURACY OR
COMPLETENESS (EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT), AND NOT AS AN
INDUCEMENT TO ACQUIRE THE PROPERTY; THAT NOTHING CONTAINED IN SUCH DELIVERIES
SHALL CONSTITUTE OR BE DEEMED TO BE A GUARANTEE, REPRESENTATION OR WARRANTY,
EXPRESS OR IMPLIED, IN ANY REGARD AS TO ANY OF THE PROPERTY (EXCEPT AS EXPRESSLY
PROVIDED IN THIS AGREEMENT); AND THAT BUYER IS RELYING ONLY UPON THE PROVISIONS
OF THIS AGREEMENT AND ITS OWN INDEPENDENT ASSESSMENT OF THE PROPERTY AND ITS
PROSPECTS IN DETERMINING WHETHER TO ACQUIRE THE PROPERTY. The provisions of this
paragraph shall survive the Closing.
5.4 Mortgage Contingency. Promptly following execution of this Agreement
by both parties, Buyer shall use its diligent efforts to procure any financing
necessary to perform its obligations under this Agreement, and shall pay all
costs, fees and expenses necessary to obtain such financing.
If during the period (the Mortgage Contingency Period) commencing on the
date of this Agreement and ending on March 15, 1999, despite Buyer's diligent
efforts to so obtain a commitment for financing or such other reasonable
assurances that such financing will be available Buyer is unable to obtain a
commitment or commitments for financing on terms satisfactory to Buyer or such
other reasonable assurances that such financing will be available as determined
by Buyer, each in Buyer's sole discretion, or if Buyer is not otherwise willing
to waive the financing contingency set forth in this Section 5.4, Buyer shall
deliver to Seller a written notice of termination of this Agreement along with a
copy of (i) correspondence from Buyer to the mortgage broker and/or the selected
lender regarding Buyer's efforts to obtain a commitment for financing, or (ii)
Buyer's transmittal letter which accompanied its mortgage application and the
Escrowed Amount and all interest earned thereon shall be returned to Buyer, and
neither party shall have any further rights or obligations hereunder other than
those intended to survive.
Once a commitment for financing is obtained, Buyer shall send a copy of
such commitment to Seller.
If prior to the end of the Mortgage Contingency Period Buyer fails to
deliver to Seller written notice terminating this Agreement along with a copy of
(i) correspondence from Buyer to the mortgage broker and/or the selected lender
regarding Buyer's efforts to obtain a commitment for financing, or (ii) Buyer's
transmittal letter which accompanied its mortgage application, the Escrowed
Amount shall become non-refundable, except as expressly set forth in Sections
6.5, 8.1(b), 8.2 and 10.1.
5.5 Return of Documents. If this Agreement is terminated for any reason
whatsoever, Buyer shall promptly deliver to Seller all documents, plans,
surveys, contracts, Leases and the like delivered to Buyer or Buyer's agents,
representatives or designees by Seller or Seller's agents, representatives or
employees pursuant to this Agreement. Delivery by Buyer to Seller of a letter
stating that Buyer has so delivered to Seller all such documents, plans,
surveys, contracts, Leases and the like shall be deemed to be conclusive
evidence of the return of such materials. In addition, Buyer shall promptly
deliver to Seller copies of all materials prepared by third-parties obtained in
connection with Buyer's diligence. Delivery by Buyer to Seller of an affidavit
cerifying that Buyer has so delivered to Seller copies of all materials prepared
by third-parties obtained in connection with Buyer's diligence shall be deemed
conclusive evidence of the return of such third-party materials. The return of
the Escrowed Amount to Buyer under this Agreement shall be contingent upon
Buyer's fulfillment of the obligations under this Section 5.5.
5.6 Confidentiality. Each party hereto agrees to maintain in confidence,
and not to discuss with or to disclose to any person or entity who is not a
party to this Agreement, any material term of this Agreement or any aspect of
the transactions contemplated hereby, except as provided in this Section. Seller
may publicly disclose the existence of this Agreement provided that the identity
of Buyer is not disclosed. Each party hereto may discuss with and disclose to
its directors, officers and employees, accountants, attorneys, existing or
prospective lenders, investment bankers, underwriters, rating agencies,
partners, consultants and other advisors to the extent such parties reasonably
need to know such information and are bound by a confidentiality obligation
identical in all material respects to the one created by this Section.
Additionally, each party may discuss and disclose such matters to the extent
necessary to comply with any requirements of the Securities and Exchange
Commission or in order to comply with any securities law or interpretation
thereof. This provision shall survive termination of this Agreement but shall
terminate upon Closing. Buyer and Seller do not contemplate issuing a press
release until after the Diligence Date. Any press release to be made regarding
any matter which is the subject of the confidentiality obligation created in
this Section shall be subject to the reasonable approval of Buyer and Seller,
respectively both as to timing and content. Buyer agrees that neither it nor any
affiliate will acquire or enter into any agreement to acquire, either directly
or indirectly any interest in Seller.
5.7 Indemnity. If any inspection or test disturbs any of the Property,
Buyer will restore the Property to substantially the same condition as existed
prior to any such inspection or test. Buyer shall keep the Property free and
clear of any liens and will indemnify, defend, and hold Seller harmless from all
losses, costs and damages including reasonable attorney's fees incurred by
Seller as a result of such entry or investigation by or on behalf of Buyer other
than loss, cost or damage which is discovered (and not caused) by such
investigation as a result of pre-existing conditions. This indemnity obligation
of Buyer shall survive the termination of this Agreement for any reason.
5.8 Buyer's Release of Seller. SELLER AND ITS PROPERTY MANAGER ARE HEREBY
RELEASED FROM ALL RESPONSIBILITY AND LIABILITY REGARDING THE CONDITION
(INCLUDING THE PRESENCE IN THE SOIL, AIR, STRUCTURES AND SURFACE AND SUBSURFACE
WATERS, OF MATERIALS OR SUBSTANCES THAT HAVE BEEN OR MAY BE IN THE FUTURE
DETERMINED TO BE TOXIC, HAZARDOUS, UNDESIRABLE OR SUBJECT TO REGULATION AND THAT
MAY NEED TO BE SPECIALLY TREATED, HANDLED AND/OR REMOVED FROM THE PROPERTY UNDER
CURRENT OR FUTURE FEDERAL, STATE AND LOCAL LAWS, REGULATIONS OR GUIDELINES),
VALUATION, SALABILITY OR UTILITY OF THE PROPERTY, OR ITS SUITABILITY FOR ANY
PURPOSE WHATSOEVER. BUYER ACKNOWLEDGES THAT ANY INFORMATION OF ANY TYPE WHICH
BUYER HAS RECEIVED OR MAY RECEIVE FROM SELLER, ITS PROPERTY MANAGER OR THEIR
RESPECTIVE AGENTS, INCLUDING, WITHOUT LIMITATION, ANY ENVIRONMENTAL REPORTS AND
SURVEYS, IS FURNISHED ON THE EXPRESS CONDITION THAT BUYER SHALL MAKE AN
INDEPENDENT VERIFICATION OF THE ACCURACY OF SUCH INFORMATION, ALL SUCH
INFORMATION BEING FURNISHED WITHOUT ANY WARRANTY WHATSOEVER.
ARTICLE 6
TITLE, SURVEY, CONDITIONS AND REPRESENTATIONS
6.1 Seller has provided Buyer with:
(a) an ALTA as-built survey of the Real Property (the Survey);
(b) a commitment for a standard ALTA Owners Policy of Title
Insurance (the Title Commitment); and
(c) a Phase I Environmental Inspection Report (the Phase I).
To enable Seller to convey, Seller may, at the Closing use the Purchase
Price or any portion thereof to clear title. Those exceptions or title
deficiencies that appear on the Title Commitment and Survey are Permitted
Encumbrances.
Buyer may only object to any exceptions to title contained in Buyer's
title commitment for the Property issued by Title Company (Buyer's Commitment)
that are not contained in the Title Commitment, if any, and that such objections
shall be made within ten (10) days following receipt of the Buyer's Commitment
by Buyer but in no event shall such objections be made after March 15, 1999. If
Seller is unable or unwilling to cure such objections, prior to the expiration
of the Mortgage Contingency Period, Buyer may elect, by written notice to
Seller, received by Seller on or before the expiration of the Mortgage
Contingency Period, not to proceed with this purchase, in which event this
Agreement shall terminate, the Escrowed Amount and all interest earned thereon
shall be returned to Buyer and this Agreement shall be null and void without
recourse to either party hereto (except to the extent such recourse arises in
connection with a provision of this Agreement which is intended to survive
termination). In the event Buyer does not terminate this Agreement as set forth
in the preceding sentence then Buyer shall be deemed to have waived such
objection and shall proceed to Closing.
6.2 On the Closing Date, Seller shall convey by Special Warranty Deed to
Buyer, title to all of the Real Property and the Improvements free and clear of
all liens, encumbrances, conditions, easements, assessments, restrictions and
other conditions, except for the following:
(a) The lien, if any, forreal estate taxes not yet due and
payable;
(b) All matters listed on Buyer's Commitment and as would be
disclosed on a current Survey as of the expiration of the
Mortgage Contingency Period and not objected to pursuant to
Section 6.1 above;
(c) All Leases disclosed to Buyer;
(d) All zoning, building and other laws applicable to the Property;
and
(e) All matters which arise after the effective date of Buyer's
Commitment which are agreed upon or consented to by Buyer in
writing.
6.3 At the Closing, Seller shall assign the Leases and Contracts which are
not to be terminated and intangible property, if any, to Buyer and Buyer shall
assume Seller's obligations thereunder from and after the Closing Date and
Seller shall convey the Personal Property to Buyer by quitclaim bill of sale.
6.4 Representations and Warranties
6.4.1 Seller hereby represents and warrants to Buyer as of the date
of this Agreement as follows:
(a) Organization and Power. Seller is a general partnership validly
existing under the laws of the State of South Carolina with all necessary
legal power to enter into and perform its obligations hereunder and under
any document or instrument required hereunder to be executed and delivered
on behalf of Seller;
(b) Authorization and Execution. The execution and delivery of this
Agreement and the consummation of the transaction contemplated hereby have
been duly authorized by all necessary parties and no other proceedings on
the part of Seller are necessary in order to permit it to consummate the
transaction contemplated hereby. This Agreement has been duly executed and
delivered by Seller and (assuming valid execution and delivery by Buyer)
is a legal, solid and binding obligation of Seller enforceable against it
in accordance with its terms; and
(c) Governmental Notices. Seller has not received any written notice
from a government agency that the location, construction, occupancy,
operation, and use of the Property (including any improvements and
equipment forming any part thereof) violate any applicable law, statute,
ordinance, rule, regulation, order or determination of any governmental
authority or any board of fire underwriters (or similar body), or any
restrictive covenant or deed restriction or zoning ordinance or
classification affecting the Property, including, without limitation, all
applicable building codes, flood disaster laws, and health and
environmental laws and regulations (hereinafter sometime collectively
called Applicable Laws). Seller has not received any written notice from a
governmental agency that the Property and Seller are currently subject to
any existing pending or threatened investigation or inquiry by any
governmental authority or to any remedial obligations under any Applicable
Laws pertaining to health or the environment.
6.4.2 The representations and warranties contained in Section 6.4.1
are hereby qualified to Seller's actual knowledge without further inquiry. Each
representation or warranty contained in Section 6.4.1 is subject to being
updated by Seller in writing on or before the Diligence Date and shall be deemed
to have been amended and updated by any information delivered to or made
available to Buyer and any other information obtained by Buyer in connection
with its diligence (including but not limited to tenant estoppel certificates).
For purposes of Section 6.4.1 actual knowledge of Seller without further inquiry
shall mean the actual awareness of Peter Sullivan provided that such individual
has no obligation to make further inquiry of any persons other than reasonable
inquiry of its property manager. No representations or warranties made hereunder
shall survive Closing.
6.4.3 Buyer hereby represents and warrants to Seller as of the date
of this Agreement as follows:
(a) Organization and Power. Buyer is a corporation organized,
existing and in good standing under the laws of the State of Texas and has
the requisite power and authority to enter into and perform the terms of
this Agreement; and
(b) Authorization and Execution. The execution and delivery of this
Agreement and the consummation of the transaction contemplated hereby have
been duly authorized by all necessary parties and no other proceedings on
the part of Buyer are necessary in order to permit it to consummate the
transaction contemplated hereby. This Agreement has been duly executed and
delivered by Buyer and (assuming valid execution and delivery by Seller)
is a legal, valid and binding obligation of Buyer enforceable against it
in accordance with its terms.
6.5 The obligations of Buyer to consummate the transaction contemplated by
this Agreement are subject to the following (any one or more of which may be
waived in whole or in part in writing by Buyer at its discretion, provided that
they shall be deemed to have been waived upon payment of the Purchase Price):
(a) the representations and warranties made by Seller in this
Agreement being true and correct in all material respects on and as of the
Closing Date with the same force and effect as though such representations
and warranties had been made as of the Closing Date;
(b) there existing no default under the lease with Waccamaw
Corporation or the lease with Phar-Mor, Inc. and the applicable time
period to cure such default has expired;
(c) obtaining tenant estoppel certificates required to be obtained
in Section 4.5; and
(d) the Improvements being no less than ninety-five percent (95%)
Rented (as hereinafter defined).
In the event that any of the foregoing conditions are not satisfied or waived in
writing (except as provided in Section 6.6), provided that they shall be deemed
to have been waived upon payment of the Purchase Price, then Buyer may elect not
to proceed with this purchase, in which event this Agreement shall terminate,
the Escrowed Amount and all interest earned thereon shall be returned to Buyer
and this Agreement shall be null and void without recourse to either party
hereto (except to the extent such recourse arises in connection with a provision
of this Agreement which is intended to survive termination).
6.6 The obligations of Seller to consummate the transaction contemplated
by this Agreement are subject to the representations and warranties made by
Buyer in this Agreement being true and correct in all material respects on and
as of the Closing Date with the same force and effect as though such
representations and warranties had been made as of the Closing Date.
Notwithstanding anything to the contrary contained in Section 6.5, if
Buyer terminates this Agreement as a result of Section 6.5(d), then the Seller
may, but shall not be required to, at its option, by written notice from Seller
to Buyer given within five (5) Business Days of Buyer's election to terminate
(Seller's Reinstatement Notice), pay to Buyer at Closing (i) the amount of rent
and any other additional pass-through charges for the shorter of (a) the
remainder of the term, or (b) one (1) year, for an amount of leased space (the
Catch Up Space), necessary to bring the Improvements to ninety-five percent
(95%) Rented, it being acknowledged that if there is a choice of which leased
space shall be used in bringing the Improvements to ninety-five percent (95%)
Rented, then the choice of space shall be determined by Seller, in Seller's sole
discretion, and (ii) a sum determined by multiplying the Catch Up Space by One
and 50/100 Dollars ($1.50), in which case Buyer's termination shall be void and
the parties hereto shall consummate the transaction contemplated by this
Agreement within five (5) Business Days of Buyer's receipt of Seller's
Reinstatement Notice to Buyer subject to the terms and provisions of this
Agreement. Seller shall not have the right to void Buyer's termination, as set
forth in the preceding sentence, if the Improvements are less than ninety
percent (90%) Rented.
For the purposes of Article 6, Rented means space which is leased to
tenants pursuant to written leases as listed on the Rent Roll and for which rent
has commenced and is being paid currently, provided such space also includes (i)
space which is leased to tenants pursuant to written leases as listed on the
Rent Roll as of the date hereof for which rent has not yet commenced, and (ii)
space under any other new leases which Buyer approves.
ARTICLE 7
CLOSING
7.1 The consummation of the purchase and sale contemplated in this
Agreement (the Closing) shall occur at the offices of Seller's counsel on April
30, 1999. It is agreed that time is of the essence in this Agreement.
7.2 On the Closing Date Seller shall deliver or cause to be delivered each
of the following items to Buyer:
(a) A duly executed and acknowledged Special Warranty Deed conveying
the Real Property and the Improvements to Buyer in the form attached
hereto as Schedule G;
(b) Duly executed quitclaim bill of sale conveying the Personal
Property to Buyer in the form attached hereto as Schedule H;
(c) Duly executed assignment and assumption of Leases (the
Assignment of Leases) in the form attached hereto as Schedule I;
(d) Duly executed assignment and assumption of Contracts, and
intangible property (the Assignment of Contracts) in the form attached
hereto as Schedule J;
(e) Transfer tax statements (or similar affidavits or forms), if
required of the Seller by local law to effect transfer or recordation of
the Special Warranty Deed;
(f) Certificate or certificates of non-foreign status from Seller in
the form attached hereto as Schedule K;
(g) Customary affidavits and indemnities sufficient for the Title
Company to delete any exceptions for mechanics or materialmen's liens from
Buyer's title policy and such other affidavits relating to such title
policy as the Title Company may reasonably request;
(h) Counterpart original of the closing statement setting forth the
Purchase Price, the closing adjustments and the application of the
Purchase Price as adjusted (the Closing Statement);
(i) Original tenant estoppel certificates from Waccamaw Corporation
and Phar-Mor, Inc. and to the extent received from all other tenants;
(j) Subordination non-disturbance and attornment agreements executed
by tenants to the extent received by such tenants;
(k) All business and accounting records pertaining to the operation
of the Property in Seller's possession;
(l) All original Leases and tenant correspondence in each case, if
in Seller's possession;
(m) Keys to all locks which manager has in its possession;
(n) Notice letters from Seller to tenants of the sale of the
Property and assignment of the Leases; and
(o) All documents customarily and reasonably required by Title
Company confirming Seller's authority to sell the Property.
7.3 On the Closing Date Buyer shall deliver or cause to be delivered at
its expense each of the following to Seller:
(a) Purchase Price for the Property, as such Purchase Price may have
been further adjusted pursuant to the provisions of this Agreement and
credited for any portion of the Escrowed Amount paid to Seller, in the
manner provided for in Article 3;
(b) Duly executed Assignment of Leases;
(c) Duly executed Assignment of Contracts;
(d) Counterpart original of the Closing Statement; and
(e) Such other instruments as Seller may reasonably request to
effectuate the transaction contemplated by this Agreement.
ARTICLE 8
CASUALTY AND CONDEMNATION
8.1 If the Improvements are damaged by fire or any other casualty and
repair of the Improvements from such damage involves repair costs equal to or
more than One Million Dollars ($1,000,000.00), in the discretion of Seller, and
the Improvements are not substantially restored to the condition immediately
prior to such casualty before the Closing Date, Buyer shall have the following
elections:
(a) to purchase the Property in its then condition and pay the
Purchase Price, in which event Seller shall pay over or assign to Buyer as
the case may be, on the Closing Date, all amounts recovered or recoverable
by Seller on account of any insurance as a result of such casualty plus
the amount of any applicable deductible, less any amounts reasonably
expended by Seller for partial restoration; or
(b) if any portion of the Improvements shall have been substantially
destroyed, to terminate this Agreement by giving notice of termination to
Seller on or before that date which is thirty (30) days after the
occurrence of the fire or other casualty or on the Closing Date, whichever
occurs first, in which event the Title Company shall return the Escrowed
Amount to Buyer, this Agreement shall terminate and neither Seller nor
Buyer shall have any recourse against the other (except to the extent such
recourse arises in connection with a provision of this Agreement which is
intended to survive termination). For purposes of this subparagraph (b),
substantially destroyed shall mean damage, in Seller's reasonable
judgment, greater than One Million Dollars $1,000,000.00.
8.2 If any portion of or interest in the Property shall be taken or is in
the process of being taken by exercise of the power of eminent domain or if any
governmental authority notifies Seller prior to the Closing Date of its intent
to take or acquire any portion of or interest in the Property (each an Eminent
Domain Taking), Seller shall give notice promptly to Buyer of such event and
Buyer shall have the option to terminate this Agreement by providing notice to
Seller to such effect on or before the date which is thirty (30) days from
Seller's notice to Buyer of such Eminent Domain Taking or on the Closing Date,
whichever occurs first, in which event the Title Company shall return the
Escrowed Amount to Buyer, this Agreement shall terminate, and neither Seller nor
Buyer shall have any recourse against the other. If Buyer does not timely notify
Seller of its election to terminate this Agreement, Buyer shall purchase the
Property and pay the Purchase Price, and Seller shall pay over or assign to
Buyer on delivery of the deed all awards recovered or recoverable by Seller on
account of such Eminent Domain Taking, less any amounts reasonably expended by
Seller in obtaining such award.
ARTICLE 9
BROKERAGE COMMISSIONS
Seller represents and warrants to Buyer that Seller has not used or
employed any broker or brokers in connection with the negotiation, execution or
consummation of the transaction contemplated by this Agreement other than
Kessinger/Hunter & Company, LLC and Retail Properties, Inc. (Seller's Agent).
Seller will indemnify, defend and hold Buyer harmless from and against any
claims of Seller's Agent for any commission, finders fee, or other compensation
in connection with the transactions contemplated by this Agreement. Seller
agrees to pay Seller's Agent its commission in accordance with a separate
agreement between Seller and Seller's Agent.
Buyer represents and warrants to Seller that Buyer has not used or
employed any broker or brokers in connection with the negotiation, execution or
consummation of the transaction contemplated by this Agreement.
Buyer and Seller each hereby agree to indemnify, defend and hold the other
harmless from and against any claims, losses, damages, costs, or expenses
(including, but not limited to, reasonable attorney's fees) of any kind or
character which arise as a result of breach of the foregoing representation and
warranty. This Section 9 shall survive the Closing or earlier termination of the
Agreement.
ARTICLE 10
DEFAULT, TERMINATION AND REMEDIES
10.1 In the event that Seller shall have failed in any material respect
adverse to Buyer on the Closing Date to have performed any of the covenants and
agreements contained in this Agreement which are to be performed by Seller on or
before the Closing Date, or if Seller defaults in its obligation to close
hereunder, Buyer shall have the following remedies, (i) the right to take any
and all legal actions necessary to compel Seller's specific performance
hereunder (it being acknowledged that damages at law would be an inadequate
remedy), and to consummate the transaction contemplated by this Agreement in
accordance with the provisions of this Agreement (such conveyance shall be
deemed to satisfy and waive any other remedy) or (ii) the right to terminate
this Agreement and receive the Escrowed Amount and all interest earned thereon.
10.2 In the event that Buyer shall have failed in any material respect
adverse to Seller on the Closing Date to have performed any of the covenants and
agreements contained in this Agreement which are to be performed by Buyer on or
before the Closing Date, or if Buyer defaults in its obligation to close
hereunder, Seller shall be entitled to receive the Escrowed Amount and all
interest earned thereon as liquidated damages, in lieu of all other remedies
available to Seller at law or in equity for such default, and Buyer shall direct
the Title Company to release the Escrowed Amount to Seller. Seller and Buyer
agree that the damages resulting to Seller as a result of such default by Buyer
as of the date of this Agreement are difficult or impossible to ascertain and
the liquidated damages set forth in the preceding sentence constitute Buyer's
and Seller's reasonable estimate of such damages.
ARTICLE 11
MISCELLANEOUS
11.1 Buyer may only assign or transfer its rights under this Agreement to
an entity owned, or controlled by Buyer or which owns or controls Buyer on a
date not later than ten (10) Business Days (as hereinafter defined) prior to the
Closing Date. Unless notice of such assignment or transfer is given to Seller
within five (5) Business Days of such assignment or transfer, such assignment or
transfer shall be null and void for the purposes of this Agreement. The
covenants and agreements contained in this Agreement shall extend to and be
obligatory upon the permitted successors and assigns of the respective parties
to this Agreement.
11.2 Except as otherwise specifically provided herein, any notice required
or permitted to be delivered under this Agreement shall be in writing and shall
be deemed given if (i) delivered by hand during regular business hours, (ii)
sent by United States Postal Service, registered or certified mail, postage
prepaid, return receipt requested, (iii) sent by a reputable overnight express
mail service that provides tracing and proof of receipt or refusal of items
mailed, or (iv) sent by telecopier or facsimile transmission with confirmation
copy by notice methods (i), (ii) or (iii) above addressed to Seller or Buyer, as
the case may be, at the address or addresses set forth below or such other
addresses as the parties may designate in a notice similarly sent. Any notice
given by a party to Title Company shall be simultaneously given to the other
party. Any notice given by a party to the other party relating to its
entitlement to the Escrowed Amount shall be simultaneously given to the Title
Company.
(1) If to Buyer:
ANBIL II Corp.
105 Town Center Road
Suite 10
King of Prussia, PA 19406
Attention:
Telecopy:
with a copy to:
Gordon Altman Butowsky Weitzen Shalov & Wein
114 West 47th Street
New York, NY 10036
Attention: Andrew N. Heine, Esq.
Telecopy: (212) 626-0799
(2) If to Seller:
West Ashley Shoppes Associates
c/o PaineWebber Properties Incorporated
265 Franklin Street, 15th Floor
Boston, MA 02110
Attention: Mr. Peter Sullivan
Telecopy: (617) 345-8725
with a copy to:
Goodwin, Procter & Hoar LLP
Exchange Place
Boston, Massachusetts 02109
Attention: Andrew C. Sucoff, Esq.
Telecopy: (617) 227-8591
(3) If to the Title Company:
First American Title Insurance Company of New York
228 East 45th Street
New York, NY 10017
Attention: Steven G. Rogers, Esq.
Telecopy: (212) 331-1580
11.3 Words of any gender used in this Agreement shall be held and
construed to include any other gender, and words of a singular number shall be
held to include the plural and vice versa, unless the context requires
otherwise.
11.4 The captions used in connection with the Articles of this Agreement
are for convenience only and shall not be deemed to extend, limit or otherwise
define or construe the meaning of the language of this Agreement.
11.5 Nothing in this Agreement, express or implied, is intended to confer
upon any person, other than the parties hereto and their respective successors
and assigns, any rights or remedies under or by reason of this Agreement.
11.6 This Agreement may be amended only by a written instrument executed
by Seller and Buyer (or Buyer's assignee or transferee).
11.7 This Agreement embodies the entire agreement between Seller and Buyer
with respect to the transaction contemplated in this Agreement, and there have
been and are no covenants, agreements, representations, warranties or
restrictions between Seller and Buyer with regard thereto other than those set
forth or provided for in this Agreement.
11.8 This Agreement shall be construed under and in accordance with the
laws of the State of South Carolina.
11.9 This Agreement may be executed in two (2) or more counterparts, each
of which shall be an original but such counterparts together shall constitute
one and the same instrument notwithstanding that both Buyer and Seller are not
signatory to the same counterpart.
11.10 The Title Company has executed this Agreement only for the purpose
of agreeing to perform the duties assigned to it under this Agreement. Prior to
the Diligence Date, Title Company is hereby authorized and directed to release
the Escrowed Amount to Buyer promptly upon Buyer's written request, without
joinder by Seller and not withstanding any objection interposed by Seller. This
Agreement shall terminate upon any such request from Buyer pursuant to Section
5.3 or Section 5.4 above. From and after the Diligence Date the Title Company
shall, upon receiving a copy of a notice given by a party in accordance with
this Agreement claiming entitlement to all or a portion of the Escrowed Amount,
give a notice to the other party that such claim of entitlement has been made.
If the Escrowed Amount is in the form of a letter of credit and the expiry
thereof has not been extended, Title Company shall cause the letter of credit to
be drawn upon and hold the proceeds as the Escrowed Amount. The Title Company
shall not cause or permit any portion of the Escrowed Amount to be disbursed
until the expiration of five (5) days of giving such notice whereupon, if the
party to whom such notice was given has not given the Title Company notice of
its objection to a disbursement in accordance with the claim of entitlement, the
Title Company shall cause a disbursement of the Escrowed Amount as requested. If
such party timely objects, however, the Title Company shall retain the Escrowed
Amount and not disburse any portion of the same unless directed by the mutual
written direction of the parties. The Title Company shall at all times disburse
the Escrowed Amount as required in a mutual written direction of the parties.
11.11 In the event of any disagreement between the parties, the Title
Company shall retain all deposits pending instructions mutually agreed to by
Seller and Buyer. In the event there is no mutual agreement by Seller and Buyer
for disbursements, the Title Company shall hold said deposits pending a court
order to disburse. The Title Company may conclusively rely on the authenticity,
validity and effectiveness of any writing delivered to it, and Title Company
shall not be obligated to make any investigation or determination, except as
provided in the case of disputes as to the truth and accuracy of any information
contained therein. Buyer and Seller agree to defend, indemnify and hold Title
Company harmless from any liabilities, suits, claims, or expenses arising from
or out of or in connection with Title Company's acts or failure to act
hereunder, unless caused or created as a result of Title Company's gross
negligence or willful misconduct, and Title Company shall be entitled to
reimbursement by Buyer and/or Seller for all reasonable costs and expenses
incurred in the performance of its duties hereunder including, without
limitation, all out-of-pocket expenses and reasonable attorney's fees of counsel
retained by Title Company. Any such costs and expenses not paid by the parties
after billing and supporting documentation by Title Company may be paid by Title
Company out of the Escrowed Amount. If there is a settlement by Buyer and Seller
prior to a court order, Buyer and Seller will share equally in the expenses
incurred by the Title Company. Otherwise, the non-prevailing party shall assume
full responsibility for the Title Company's expenses. Title Company is not
required to advance or expend or risk its own funds or otherwise incur personal
liability in performance of its duties hereunder and it may require advancement
of funds by the parties.
11.12 Time is expressly declared to be of the essence of this Agreement.
11.13 The obligations of Seller hereunder shall be binding only on the
Property and neither Buyer nor anyone claiming by, through or under Buyer shall
be entitled to obtain any judgment extending liability beyond the Property or
creating personal liability on the part of the officers, directors,
shareholders, or agents of Seller or any of their successors. The obligations of
Buyer hereunder shall be binding only on the assets of Buyer and neither Seller
nor anyone claiming by, through or under Seller shall be entitled to obtain any
judgment creating personal liability on the part of the partners, officers,
shareholders, or agents of Buyer or any of their successors or any affiliated
entities.
11.14 As used herein, the term business day shall mean any day other than
on Saturday, Sunday, or federal holiday.
11.15 Property Conveyed AS IS.
(a) NOTWITHSTANDING ANYTHING CONTAINED HEREIN TO THE CONTRARY, IT IS
UNDERSTOOD AND AGREED THAT, EXCEPT AS EXPRESSLY SET FORTH HEREIN, SELLER AND ITS
PROPERTY MANAGER HAVE NOT MADE AND ARE NOT NOW MAKING, AND THEY SPECIFICALLY
DISCLAIM, ANY OTHER WARRANTIES, REPRESENTATIONS OR GUARANTIES OF ANY KIND OR
CHARACTER, EXPRESS OR IMPLIED, ORAL OR WRITTEN, PAST, PRESENT OR FUTURE, WITH
RESPECT TO THE PROPERTY, INCLUDING, BUT NOT LIMITED TO, WARRANTIES,
REPRESENTATIONS OR GUARANTIES AS TO (I) MATTERS OF TITLE (OTHER THAN SELLER'S
WARRANTY OF TITLE SET FORTH IN THE DEED (HEREINAFTER DEFINED) TO BE DELIVERED AT
CLOSING), (II) ENVIRONMENTAL MATTERS RELATING TO THE PROPERTY OR ANY PORTION
THEREOF, (III) GEOLOGICAL CONDITIONS, INCLUDING, WITHOUT LIMITATION, SUBSIDENCE,
SUBSURFACE CONDITIONS, WATER TABLE, UNDERGROUND WATER RESERVOIRS, LIMITATIONS
REGARDING THE WITHDRAWAL OF WATER, AND EARTHQUAKE FAULTS AND THE RESULTING
DAMAGE OF PAST AND/OR FUTURE EARTHQUAKES, (IV) WHETHER, AND TO THE EXTENT TO
WHICH THE PROPERTY OR ANY PORTION THEREOF IS AFFECTED BY ANY STREAM (SURFACE OR
UNDERGROUND), BODY OF WATER, FLOOD PRONE AREA, FLOOD PLAIN, FLOODWAY OR SPECIAL
FLOOD HAZARD, (V) DRAINAGE, (VI) SOIL CONDITIONS, INCLUDING THE EXISTENCE OF
INSTABILITY, PAST SOLID REPAIRS, SOIL ADDITIONS OR CONDITIONS OF SOIL FILL, OR
SUSCEPTIBILITY TO LANDSLIDES, OR THE SUFFICIENCY OF ANY UNDERSHORING, (VII)
ZONING TO WHICH THE PROPERTY OR ANY PORTION THEREOF MAY BE SUBJECT, (VIII) THE
AVAILABILITY OF ANY UTILITIES TO THE PROPERTY OR ANY PORTION THEREOF INCLUDING,
WITHOUT LIMITATION, WATER, SEWAGE, GAS AND ELECTRIC, (IX) USAGES OF ADJOINING
PROPERTY, (X) ACCESS TO THE PROPERTY OR ANY PORTION THEREOF, (XI) THE VALUE,
COMPLIANCE WITH THE PLANS AND SPECIFICATIONS, SIZE, LOCATION, AGE, USE, DESIGN,
QUALITY, DESCRIPTION, SUITABILITY, STRUCTURAL INTEGRITY, OPERATION, TITLE TO, OR
PHYSICAL OR FINANCIAL CONDITION OF THE PROPERTY OR ANY PORTION THEREOF, OR ANY
INCOME, EXPENSES, CHARGES, LIENS, ENCUMBRANCES, RIGHTS OR CLAIMS ON OR AFFECTING
OR PERTAINING TO THE PROPERTY OR ANY PART THEREOF, OR ANY INCOME, EXPENSES,
CHARGES, LIENS, ENCUMBRANCES, RIGHTS OR CLAIMS ON OR AFFECTING OR PERTAINING TO
THE PROPERTY OR ANY PART THEREOF, (XII) THE PRESENCE OF HAZARDOUS SUBSTANCES IN
OR ON, UNDER OR IN THE VICINITY OF THE PROPERTY, (XIII) THE CONDITION OR USE OF
THE PROPERTY OR COMPLIANCE OF THE PROPERTY WITH ANY OR ALL PAST, PRESENT OR
FUTURE FEDERAL, STATE OR LOCAL ORDINANCES, RULES, REGULATIONS OR LAWS, BUILDING,
FIRE OR ZONING ORDINANCES, CODES OR OTHER SIMILAR LAWS, (XIV) THE EXISTENCE OR
NON-EXISTENCE OF UNDERGROUND STORAGE TANKS, (XV) ANY OTHER MATTER AFFECTING THE
STABILITY OR INTEGRITY OF THE REAL PROPERTY, (XVI) THE POTENTIAL FOR FURTHER
DEVELOPMENT OF THE PROPERTY, (XVII) THE EXISTENCE OF VESTED LAND USE, ZONING OR
BUILDING ENTITLEMENTS AFFECTING THE PROPERTY, (XVIII) THE MERCHANTABILITY OF THE
PROPERTY OR FITNESS OF THAT PROPERTY FOR ANY PARTICULAR PURPOSE (BUYER AFFIRMING
THAT BUYER HAS NOT RELIED ON SELLER'S OR ITS PROPERTY MANAGERS SKILL OR JUDGMENT
TO SELECT OR FURNISH THE PROPERTY FOR ANY PARTICULAR PURPOSE, AND THAT SELLER
MAKES NO WARRANTY THAT THE PROPERTY IS FIT FOR ANY PARTICULAR PURPOSE), OR (XIX)
TAX CONSEQUENCES.
(b) BUYER HAS NOT RELIED UPON AND WILL NOT RELY UPON, EITHER
DIRECTLY OR INDIRECTLY, ANY REPRESENTATION OR WARRANTY OF SELLER OR ITS PROPERTY
MANAGER OR ANY OF THEIR RESPECTIVE AGENTS, EXPECT AS EXPRESSLY SET FORTH HEREIN,
AND ACKNOWLEDGES THAT NO OTHER SUCH REPRESENTATIONS HAVE BEEN MADE. BUYER
REPRESENTS THAT IT IS A KNOWLEDGEABLE, EXPERIENCED AND SOPHISTICATED BUYER OF
REAL ESTATE AND THAT IT IS RELYING SOLELY ON ITS OWN EXPERTISE AND THAT OF
BUYER'S CONSULTANTS IN PURCHASING THE PROPERTY. BUYER WILL CONDUCT SUCH
INSPECTIONS AND INVESTIGATIONS OF THE PROPERTY AS BUYER DEEMS NECESSARY,
INCLUDING, BUT NOT LIMITED TO, THE PHYSICAL AND ENVIRONMENTAL CONDITIONS
THEREOF, AND SHALL RELY UPON SAME. UPON CLOSING, BUYER SHALL ASSUME THE RISK
THAT ADVERSE MATTERS, INCLUDING, BUT NOT LIMITED TO, ADVERSE PHYSICAL AND
ENVIRONMENTAL CONDITIONS, MAY NOT HAVE BEEN REVEALED BY BUYER'S INSPECTIONS AND
INVESTIGATIONS. BUYER ACKNOWLEDGES AND AGREES THAT UPON CLOSING, SELLER SHALL
SELL AND CONVEY TO BUYER AND BUYER SHALL ACCEPT THE PROPERTY AS IS, WHERE IS,
WITH ALL FAULTS. BUYER FURTHER ACKNOWLEDGES AND AGREES THAT THERE ARE NO ORAL
AGREEMENTS, WARRANTIES OR REPRESENTATIONS, COLLATERAL TO OR AFFECTING THE
PROPERTY BY SELLER, ANY AGENT OF SELLER OR ANY THIRD PARTY. THE TERMS AND
CONDITIONS OF THIS SECTION 11.4(B) SHALL EXPRESSLY SURVIVE THE CLOSING, NOT
MERGE WITH THE PROVISIONS OF ANY CLOSING DOCUMENTS AND SHALL BE INCORPORATED
INTO THE DEED. SELLER IS NOT LIABLE OR BOUND IN ANY MANNER BY ANY ORAL OR
WRITTEN STATEMENTS, REPRESENTATIONS, OR INFORMATION PERTAINING TO THE PROPERTY
FURNISHED BY ANY REAL ESTATE BROKER, AGENT, EMPLOYEE, SERVANT OR OTHER PERSON,
UNLESS THE SAME ARE SPECIFICALLY SET FORTH OR REFERRED TO HEREIN. BUYER
ACKNOWLEDGES THAT THE PURCHASE PRICE REFLECTS THE AS IS NATURE OF THIS SALE AND
ANY FAULTS, LIABILITIES, DEFECTS OR OTHER ADVERSE MATTERS THAT MAY BE ASSOCIATED
WITH THE PROPERTY. BUYER HAS FULLY REVIEWED THE DISCLAIMERS AND WAIVERS SET
FORTH IN THIS AGREEMENT WITH ITS COUNSEL AND UNDERSTANDS THE SIGNIFICANCE AND
EFFECT THEREOF.
--------------
Buyer's Initials
<PAGE>
ARTICLE 12
IRS FORM 1099-S DESIGNATION
12.1 In order to comply with information reporting requirements of Section
6045(e) of the Internal Revenue Code of 1986, as amended, and the Treasury
Regulations thereunder, the parties agree (1) to execute an IRS Form 1099-S
Designation Agreement in the form attached hereto as Schedule D at or prior to
the Closing to designate the Title Company (the Designee) as the party who shall
be responsible for reporting the contemplated sale of the Property to the
Internal Revenue Service (the IRS) on IRS Form 1099-S; (2) to provide the
Designee with the information necessary to complete Form 1099-S; (3) that the
Designee shall not be liable for the actions taken under this Agreement, or for
the consequences of those actions, except as they may be the result of gross
negligence or willful misconduct on the part of the Designee; and (4) that the
Designee shall be indemnified by the parties for any costs or expenses incurred
as a result of the actions taken hereunder, except as they may be the result of
gross negligence or willful misconduct on the part of the Designee. The Designee
shall provide all parties to this transaction with copies of the IRS Forms
1099-S filed with the IRS and with any other documents used to complete IRS Form
1099-S.
[Remainder of page left intentionally blank]
<PAGE>
IN WITNESS WHEREOF, the parties have executed this instrument as of the
day and year first set forth above.
SELLER:
WEST ASHLEY SHOPPES ASSOCIATES
By: PaineWebber Equity Partners Two Limited
Partnership, its General Partner
By: Second Equity Partners, Inc.,
its General Partner
By: /s/Peter F. Sullivan
--------------------
Name: Peter F. Sullivan
Title: Vice President
BUYER:
ANBIL II CORP.
By: /s/ Andrew N. Heine
-------------------
Name: Andrew N. Heine
Title: President
TITLE COMPANY:
FIRST AMERICAN TITLE INSURANCE
COMPANY OF NEW YORK
By: /s/ Steven G. Rogers
--------------------
Name: Steven G. Rogers
<PAGE>
FIRST AMENDMENT TO AMENDED AND RESTATED
PURCHASE AND SALE AGREEMENT BY AND BETWEEN
WEST ASHLEY SHOPPES ASSOCIATES (SELLER) AND
ANBIL II CORP. (BUYER)
This First Amendment to Amended and Restated Purchase and Sale Agreement
(this First Amendment) is entered into as of the 15th day of March, 1999 by and
between Seller and Buyer, upon the following terms and conditions:
WHEREAS, Buyer and Seller entered into that certain Purchase and Sale
Agreement dated February 2, 1999, as amended and restated in that certain
Amended and Restated Purchase and Sale Agreement dated as of February 26, 1999
(the Purchase and Sale Agreement); and
WHEREAS, Buyer and Seller desire to amend the Purchase and Sale Agreement
as set forth below.
NOW, THEREFORE, in consideration of and in reliance upon the above
Recitals, the terms, covenants and conditions contained in this First Amendment
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, Buyer and Seller agree as follows:
1. The first sentence of Section 4.5 is hereby deleted in its entirety and
replaced with the following language:
Seller shall (i) obtain tenant estoppel certificates which do not
list any monetary defaults from Waccamaw Corporation, Phar-Mor,
Inc., Countrywide Home Loans, Inc. (Countrywide), LH&P, LLC d/b/a
Once Upon a Child (Once Upon a Child) and such other tenants as are
required so that such certificates are received from tenants
occupying at least 119,000 square feet at the Property, and (ii) use
commercially reasonable efforts to obtain tenant estoppel
certificates, from all other tenants currently occupying their space
under its respective Lease in each case, in the form attached hereto
as Schedule E or in the form attached to or containing the
information required under such Lease, if any. The Countrywide and
Once Upon a Child tenant estoppel certificates set forth in (i)
above shall state, in addition to the requirements set forth herein,
that there exists no unsatisfied conditions precedent for such
tenant to commence payment of rent on or before June 1, 1999.
2. Section 4.6 is hereby deleted in its entirety and replaced with the
following language:
Seller shall submit subordination, non-disturbance and attornment
agreements to all tenants currently occupying space under a Lease in
the form attached hereto as Schedule M. It shall be a condition
precedent to Closing that Seller obtain subordination,
non-disturbance and attornment agreements from Waccamaw Corporation,
Phar-Mor, Inc. and Audio Warehouse (i) in the form required or
containing the information required under such Lease, or (ii) in the
form attached hereto as Schedule M.
3. The phrase Special Warranty Deed in the first line of Section 6.2 and
the first line of Section 7.2(a) is hereby deleted and replaced with General
Warranty Deed.
4. Section 7.1 is hereby deleted in its entirety and replaced with the
following language:
The consummation of the purchase and sale contemplated in this
Agreement (the Closing) shall occur at the offices of Seller's
counsel on May 15, 1999. It is agreed that time is of the essence in
this Agreement.
5. Section 7.2(i) is hereby deleted in its entirety and replaced with the
following language:
Original tenant estoppel certificates from Waccamaw Corporation,
Phar-Mor, Inc., Countrywide and Once Upon a Child and to the extent
received from all other tenants;
6. Section 7.2(j) is hereby deleted in its entirety and replaced with the
following language:
Subordination, non-disturbance and attornment agreements executed by
tenants to the extent received by such tenants and as required
pursuant to Section 4.6;
7. The first sentence of Section 11.1 is hereby deleted in its entirety
and replaced with the following language:
Buyer may only assign or transfer its rights under this Agreement to
an entity owned or managed by Andrew N. Heine or which owns or
controls Buyer on a date not later than ten (10) Business Days (as
hereinafter defined) prior to the Closing Date.
8. Schedule E is hereby deleted in its entirety and replaced with Schedule
E attached hereto.
9. Schedule M is hereby deleted in its entirety and replaced with Schedule
M attached hereto.
10. Except as hereinabove set forth, all terms, covenants and provisions
of the Purchase and Sale Agreement remain unaltered and in full force and
effect, and Seller and Buyer hereby expressly ratify the Purchase and Sale
Agreement, as modified and amended herein.
IN WITNESS WHEREOF, the parties hereto have caused this First Amendment to
be duly executed under seal as of the day and year first written above.
SELLER:
WEST ASHLEY SHOPPES ASSOCIATES
By: PaineWebber Equity Partners Two Limited
Partnership, its General Partner
By: Second Equity Partners, Inc.,
its General Partner
By: /s/Peter F. Sullivan
--------------------
Name: Peter F. Sullivan
Title: Vice President
BUYER:
ANBIL II CORP.
By: /s/ Andrew N. Heine
-------------------
Name: Andrew N. Heine
Title: President
7(a). On or before the Closing Date Seller shall deliver or cause to be
delivered to Buyer a reliance letter from Dames & Moore or its successors or
assigns substantially in the form attached hereto as Exhibit 1.
2(a)
<PAGE>
ASSIGNMENT OF CONTRACT, WITH ACCEPTANCE AND ASSUMPTION
FOR VALUE RECEIVED,
ANBIL II CORP., a Texas corporation having offices at 105 Town Centre
Road, King of Prussia, Pennsylvania 19406 (hereinafter "Assignor"),
hereby assigns, transfers and sets over unto
West Ashley Shoppes LLC, a South Carolina limited liability company having
offices at 105 Town Centre Road, King of Prussia, Pennsylvania 19406
(hereinafter, "Assignee"),
all of Assignor's right, title and interest in and to that certain Amended and
Restated Purchase and Sale Agreement dated as of February 26, 1999 (as amended,
the "Contract"), by and between West Ashley Shoppes Associates, as Seller, and
Assignor, as Buyer, relating to the real property and improvements known as the
West Ashley Shopping Center, located on Orleans Road in Charleston, South
Carolina, as more practically described in the Contract, together with all sums
paid or deposited on account of the purchase price thereunder.
To have and to hold unto Assignee, and the successors and assigns of Assignee,
forever.
By its execution hereof, Assignee hereby (i) accepts the within assignment, (ii)
agrees to be bound by the Contract as Buyer thereunder, subject to the
limitations of liability therein contained, and (iii) assumes, subject to the
limitations of liability therein contained, all of obligations of Buyer under
the Contract.
IN WITNESS WHEREOF, Assignor and Assignee have executed this Assignment of
Contract with Acceptance and Assumption, as of the 28th day of April, 1999.
Assignor: Anbil II Corp.
By: /s/ Andrew N. Heine
-------------------
Andrew N. Heine
President
Assignee: West Ashley Shoppes LLC
By: Anran Inc., Manager
By: /s/ Andrew N. Heine
-------------------
Andrew N. Heine
President
<PAGE>
GENERAL WARRANTY DEED
STATE OF SOUTH CAROLINA )
) TITLE TO REAL ESTATE
COUNTY OF CHARLESTON )
KNOW ALL MEN BY THESE PRESENTS that WEST ASHLEY SHOPPES ASSOCIATES
(Grantor), a South Carolina general partnership, in the State aforesaid, for and
in consideration of the sum of Eight Million One Hundred Thousand Dollars
($8,100,000.00), to it in hand paid by WEST ASHLEY SHOPPES LLC (Grantee), a
South Carolina limited liability company, in the State aforesaid, the receipt
whereof is hereby acknowledged, has granted, bargained, sold and released, and
by these presents does grant, bargain, sell and release, unto said WEST ASHLEY
SHOPPES LLC, its heirs and assigns forever, the following described real
property, to wit:
See Exhibit A, being a portion of the property conveyed to West Ashley
Shoppes Associates by deed of Orleans Road Development Company, a Missouri
general partnership, dated March 10, 1988 and recorded on March 10, 1988 in Book
B-173, Page 77 in the RMC Office for Charleston County, South Carolina (the Real
Property).
TMS #: 351-09-00-056; 351-09-00-058; 351-09-00-059; 351-09-00-060;
351-09-00-061
Grantees Address: 105 Town Centre Road, King of Prussia, Pennsylvania 19406
TOGETHER with all and singular, the Rights, Members, Hereditaments and
Appurtenances to the said Premises belonging, or in anywise incident or
appertaining.
SUBJECT TO the items set forth on Exhibit B.
TO HAVE AND TO HOLD, all and singular, the said Premises before mentioned,
unto the said WEST ASHLEY SHOPPES LLC, its heirs and assigns forever.
AND Grantor does hereby bind itself and its heirs, executors,
administrators, successors and assigns, to warrant and forever defend, all and
singular, the said Premises unto said WEST ASHLEY SHOPPES LLC, its heirs,
successors and assigns, against itself and its heirs, successors and assigns,
and every person whomsoever lawfully claiming, or to claim the same, or any part
thereof.
WITNESS the Grantors Hand and Seal this 14th day of May, in the year of our
Lord one thousand nine hundred and ninety-nine, and in the two hundred and
twenty-third year of the Sovereignty and Independence of the United State of
America.
<PAGE>
SIGNED, SEALED AND DELIVERED WEST ASHLEY SHOPPES ASSOCIATES
IN THE PRESENCE OF:
By: PaineWebber Equity Partners Two
Limited Partnership, its General Partner
By: Second Equity Partners, Inc., its
General Partner
By: /s/Peter F. Sullivan
--------------------
Name: Peter F. Sullivan
Title: Vice President
By: Second Equity Partners, Inc., its
General Partner
By: /s/Peter F. Sullivan
--------------------
Name: Peter F. Sullivan
Title: Vice President
STATE OF MASSACHUSETTS )
) ACKNOWLEDGMENT
COUNTY OF SUFFOLK )
The foregoing instrument was acknowledged before me this 14th day of May,
1999 by Peter Sullivan, the Vice President of Second Equity Partners, Inc., the
General Partner of PaineWebber Equity Partners Two Limited Partnership, a
General Partner of West Ashley Shoppes Associates.
/s/ Linda Z. MacDonald
------------------
Notary Public
My Commission Expires: 11/12/99
(SEAL)
<PAGE>
ASSIGNMENT AND ASSUMPTION OF LEASES AND SECURITY DEPOSITS
THIS ASSIGNMENT OF LEASES AND SECURITY DEPOSITS (Assignment) is made
and entered into effective this 11th day of May, 1999, by and between West
Ashley Shoppes Associates, a South Carolina general partnership (Assignor) and
West Ashley Shoppes LLC, a South Carolina limited liability company (Assignee).
The parties enter into this Assignment on the basis of and in
reliance upon the following facts:
A. Assignor has conveyed contemporaneously herewith to Assignee that
certain improved parcel of land located in the Charleston, South Carolina, more
particularly described on EXHIBIT A attached hereto and by this reference
incorporated herewith (the Property).
B. Assignor has previously, in its capacity as owner of the Property,
entered into certain occupancy leases at the Property, which are currently in
force and effect, as described in EXHIBIT B attached hereto and by this
reference incorporated herewith (Leases).
C. Assignor now desires to assign and transfer to Assignee all of the
Leases, together with any security deposits paid pursuant to the terms thereof
and listed on EXHIBIT C attached hereto and made a part hereof for all purposes,
and Assignee desires to accept the Leases and all of Assignors right, title,
interest and obligations in, to and under the Leases, as set forth herein.
NOW, THEREFORE, in consideration of (i) Ten Dollars ($10.00) and
other good and valuable cash consideration and (ii) the mutual covenants and
promises of the parties provided for herein, Assignor and Assignee agree as
follows:
1. Assignment. Assignor hereby assigns all of its right, title and
interest in, to and under the Leases and any security deposits paid pursuant
thereto as set forth on EXHIBIT C to Assignee.
2. Assumption. Assignee hereby accepts said assignment and assumes all of
the obligations of Assignor under the Leases from and after the date hereof.
3. Multiple Counterparts. This Assignment may be executed in multiple
counterparts, each of which shall be deemed an original and all of which
together shall constitute one and the same document. All signatures need not
appear on any one counterpart.
<PAGE>
IN WITNESS WHEREOF, the undersigned parties have executed this Assignment as of
the date first written above.
ASSIGNOR:
WEST ASHLEY SHOPPES ASSOCIATES
By: PaineWebber Equity Partners Two
Limited Partnership, its General Partner
By: Second Equity Partners, Inc., its
General Partner
By: /s/Peter F. Sullivan
--------------------
Name: Peter F. Sullivan
Title: Vice President
By: Second Equity Partners, Inc., its
General Partner
By: /s/Peter F. Sullivan
--------------------
Name: Peter F. Sullivan
Title: Vice President
ASSIGNEE:
WEST ASHLEY SHOPPES LLC
By: Anran Inc., its Manager
By: /s/ Andrew N. Heine
-------------------
Name: Andrew N. Heine
Title: President
<PAGE>
ASSIGNMENT AND ASSUMPTION OF CONTRACTS AND INTANGIBLES
This Assignment and Assumption of Contracts and Intangibles (this
Assignment) is made and entered into as of this 11th day of May, 1999, by and
between West Ashley Shoppes Associates, a South Carolina general partnership,
(Assignor), and West Ashley Shoppes LLC, a South Carolina limited liability
company, (Assignee).
WITNESSETH:
Assignor hereby assigns, sells, transfers, sets over and delivers unto
Assignee all of Assignors estate, right, title and interest in and to the
following:
1. all licenses, permits, certificates of occupancy, approvals,
entitlement, dedications, and subdivision maps issued, approved or granted by
any governmental authorities or otherwise in connection with the real property
known as West Ashley Shopping Center, Charleston, South Carolina (Property)
described in Exhibit A attached hereto; the use of the name West Ashley Shopping
Center and any other trade names, trademarks, and logos used by Assignor in the
operation and identification of the Property; all development rights and other
intangible rights, titles, interests, privileges and appurtenances of Assignor
related to or used in connection with the Property and its operation; and all
licenses, consents, easements, rights of way and approvals issued, approved or
granted by any private parties to make use of utilities and to insure vehicular
and pedestrian ingress and egress to the Property (collectively, Licenses and
Permits);
2. all plans and specifications respecting any buildings or improvements
located on the Property; and all building inspection reports pertaining to the
Property which are owned by and within the possession or control of Assignor
(collectively, Records and Plans);
3. all warranties and guaranties in effect with respect to the Property,
including, but not limited to, (i) that certain warranty, number MS187541 issued
by Duro-Last Roofing, Inc., and (ii) that certain warranty, number NO048855
issued by Firestone Building Products Company, and all contracts for services
and all operating agreements currently in effect with respect to the Property
(the Contracts); and
4. the interest of Assignor in all other intangible personalty relating to
the use and operation of the Property including good will if any (the
Intangibles).
Assignor makes no warranties of any kind or nature, express or implied,
regarding the Licenses and Permits, Records and Plans and Contracts and
Intangibles.
Assignee hereby assumes the performance of all of the terms, convents and
conditions imposed upon Assignor under the Licenses and Permits, Records and
Plans and Contracts arising on or after the date of delivery of this Assignment.
Assignor shall be responsible for the performance of all of the terms, covenants
and conditions imposed upon Assignor under the Licenses and Permits, Records and
Plans and Contracts arising prior to the date of delivery of this Assignment.
This Assignment may be executed in one or more counterparts, each of which
shall be deemed an original, and all of such counterparts, taken together, shall
constitute one and the same instrument.
The terms and provisions of this Assignment shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns.
<PAGE>
IN WITNESS WHEREOF, Assignor and Assignee have executed this Assignment as of
the date first written above.
ASSIGNOR:
WEST ASHLEY SHOPPES ASSOCIATES
By: PaineWebber Equity Partners Two
Limited Partnership, its General Partner
By: Second Equity Partners, Inc., its
General Partner
By: /s/Peter F. Sullivan
--------------------
Name: Peter F. Sullivan
Title: Vice President
By: Second Equity Partners, Inc., its
General Partner
By: /s/Peter F. Sullivan
--------------------
Name: Peter F. Sullivan
Title: Vice President
ASSIGNEE:
WEST ASHLEY SHOPPES LLC
By: Anran Inc., its Manager
By: /s/ Andrew N. Heine
-------------------
Name: Andrew N. Heine
Title: President
<PAGE>
<TABLE>
FIRST AMERICAN TITLE INSURANCE COMPANY
SETTLEMENT STATEMENT
COMMITMENT NO.: 135-SC-28327
SELLER: WEST ASHLEY SHOPPES ASSOCIATES
PRUCHASER: WEST ASHLEY SHOPPES, LLC
PROPERTY: WEST ASHLEY SHOPPING CENTER, CHARLESTON, SC
CLOSING DATE: 5/14/99
<CAPTION>
PURCHASER'S SELLER'S
CREDITS CREDITS
------- -------
<S> <C> <C>
PURCHASE PRICE: $8,100,000.00 $ 8,100,000.00
ADJUSTMENTS:
Prorations: Period days Amount Days Per Diem
----------- ------ ---- ---------
Real Estate Taxes 365 $121,680.02 133 333.3699178 44,338.20
Storm Sewer Fee 31 $ 868.31 13 28.01 364.13
Rent Cam Ins. Tax Adj. 53,290.83
Commission On Countrywide Homes Loans, Inc. 11,550.00
Commission on One Way Eyeglasses renewal 1,136.19
Tenant Improvement costs Once Upon a Child's 15,000.00
Security Deposits 14,525.00
Sweeping Bill 377.42
Fee for Transfer of Letter of Credit 250.00
Phar-Mor 1999 CAM and Real Estate Taxes 31,511.91
------------ -------------
Sub-Total 127,768.16 8,144,575.52
Seller's Adjustments (127,768.16)
-------------
ADJUSTED PURCHASE PRICE 8,016,807.36
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
PURCHASER'S SELLER'S
CREDITS CREDITS
------- -------
<S> <C> <C>
SELLER'S CHARGES:
Realty Transfer Tax 29,970.00
Broker's Commission: Kessinger/Hunter & Company, I.C. 99,000.00
Broker's Commission Retail Properties, Inc. 66,000.00
-------------
TOTAL SELLER'S CHARGES 194,970.00
NET DUE SELLER: 8,016,807.36
-------------
NET DUE SELLER LESS SELLER'S CHARGES: $7,821,837.36
=============
SELLER: PURCHASER:
West Ashley Shoppes Associates West Ashley Shoppes, LLC
(see attached) By: Anran Inc., Manager
By: /s/ Andrew N. Heine
-------------------
Andrew N. Heine
President
</TABLE>
<PAGE>
EXECUTED as of this 13th day of May, 1999.
WEST ASHLEY SHOPPES ASSOCIATES
By: PaineWebber Equity Partners Two
Limited Partnership, its General Partner
By: Second Equity Partners, Inc., its
General Partner
By: /s/Peter F. Sullivan
--------------------
Name: Peter F. Sullivan
Title: Vice President
By: Second Equity Partners, Inc., its
General Partner
By: /s/Peter F. Sullivan
--------------------
Name: Peter F. Sullivan
Title: Vice President
<PAGE>
WEST ASHLEY SHOPPES: TRACT E
CHARLESTON, SOUTH CAROLINA
PURCHASE AND SALE AGREEMENT
THIS PURCHASE AND SALE AGREEMENT (the Agreement) is made and entered into
as of the 2nd day of February, 1999, by and between WEST ASHLEY SHOPPES
ASSOCIATES (the Seller), a South Carolina general partnership with an address of
c/o PaineWebber Properties Incorporated, 265 Franklin Street - 15th Floor,
Boston, Massachusetts 02110, and KELLY & COHEN APPLIANCES, INC. (the Purchaser),
an Ohio corporation with an address of 2875 Needmore Road, Dayton, Ohio 45414.
RECITALS
A. Seller is the owner of the Property (as such term is hereinafter
defined).
B. Seller desires to sell the Property to Purchaser, and Purchaser desires
to purchase the Property from Seller, each upon and subject to the terms and
conditions of this Agreement.
THEREFORE, in consideration of and in reliance upon the above Recitals,
the terms, covenants and conditions contained in this Agreement, and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Seller and Purchaser agree as follows:
1. PURCHASE AND SALE OF PROPERTY.
Subject to the terms and conditions of this Agreement, Seller hereby
agrees to sell and Purchaser hereby agrees to purchase the land known as Tract E
of West Ashley Shopping Center in Charleston, South Carolina, as more
particularly described in Exhibit A attached hereto, together with and subject
to all and singular easements, covenants, agreements, rights, privileges,
tenements, hereditaments and appurtenances thereunto now or hereafter belonging
or appertaining thereto (all of which is hereinafter collectively referred to as
the Property).
2. PURCHASE PRICE.
The purchase price to be paid by Purchaser to Seller for the Property is
Two Hundred and Eighty Thousand Dollars ($280,000) (the Purchase Price), which
shall be paid as follows:
1. Earnest Money. Upon the execution of this Agreement by Seller and Purchaser,
Seller, Purchaser and Escrowee, as hereinafter defined, shall execute the
Earnest Money Escrow Instructions, in the form attached hereto as Exhibit B (the
Escrow Instructions) and Purchaser shall deliver to the Old Republic National
Title Insurance Company (Escrowee) immediately available federal funds in the
amount of Ten Thousand Dollars ($10,000) (the Deposit). The Deposit, together
with the Additional Deposit, and the Second Additional Deposit, all as
hereinafter defined, and any interest earned thereon net of investment costs, is
referred to in this Agreement as the Earnest Money. Escrowee will hold, invest
in an interest bearing account and discharge the Earnest Money pursuant to the
terms and conditions of this Agreement and the Escrow Instructions.
2. Cash at Closing. At Closing, as hereinafter defined, Purchaser shall pay to
Seller the Cash Balance.
As used herein, the Cash Balance payable by Purchaser to Seller at
Closing shall equal the Purchase Price less the Earnest Money, such sum to be
paid in immediately available federal funds to an account designated by Seller
in writing to Purchaser, subject, however, to such adjustments as are required
by this Agreement.
3. STATUS OF TITLE TO PROPERTY.
1. State of Title. At Closing, Seller shall convey to Purchaser fee simple
estate in and to the Property by a recordable special warranty deed, subject to:
covenants, conditions, restrictions and easements of record, including but not
limited to the restrictions listed on Exhibit A-1, attached hereto, the lien of
general real estate taxes which are not yet due or payable and any lien for
special taxes or assessments which are not yet due or payable (all of which is
hereinafter collectively referred to as the Permitted Exceptions). Purchaser
hereby covenants and agrees to comply with the Permitted Exceptions and that any
party with standing, including Seller, shall have the right to take any and all
legal actions necessary to compel Purchasers specific performance of this
covenant, it being acknowledged that damages at law would be an inadequate
remedy. The preceding sentence shall survive Closing.
2. Preliminary Evidence of Title. Purchaser shall obtain at its sole cost and
expense the following documents to evidence the condition of Seller's title to
the Property and Purchaser shall provide Seller with a copy of such documents as
the same are received by Purchaser:
(1) a commitment (the Title Commitment) for an ALTA Form B (1987) Owners Title
Insurance Policy proposing to insure Purchaser and committing to insure the
Property in the amount of the Purchase Price, issued by Old Republic National
Title Insurance Company through the office of Trident Abstract Co., Inc., with
an address of P.O. Box 858, Charleston, South Carolina, 29402 (the Title
Insurer).
(2) written results of searches (the UCC Searches) conducted by a company
reasonably acceptable to Purchaser of the records of the County Recorder and
Secretary of State of the State in which the Property is located for Uniform
Commercial Code Financing Statements, tax liens and the like in either the name
of Seller, the Property or any other name or location reasonably requested by
Purchaser, effective as of a date after the date of this Agreement;
(3) legible copies of all documents of record referred to in the Title
Commitment or disclosed by the UCC Searches, and all other documents evidencing
or relating to matters reflected in the Title Commitment or the UCC Searches;
and
(4) a current survey (the Survey) of the Property certified to Purchaser and the
Title Insurer (and such other persons or entities as Purchaser may designate) by
a surveyor in the State in which the Property is located.
3. Title Defects. If the Title Commitment, UCC Searches or Survey (or any
revision or update of any of them) discloses exceptions to title or other
matters to which Purchaser objects, Purchaser shall so notify Seller at least
ten (10) days prior to the expiration of the Initial Due Diligence Period, as
hereinafter defined, and Seller shall have until the day prior to the expiration
of the Initial Due Diligence Period (Seller's Cure Period) to notify Purchaser
whether it will have such exception to title removed, bonded over or corrected.
If within Seller's Cure Period, Seller fails to so notify Purchaser that it will
have each such unpermitted exception removed, bonded over or corrected as
aforesaid, Purchaser may, at its option, either (i) terminate this Agreement and
immediately receive from the Escrowee the Earnest Money, in which event this
Agreement, without further action of the parties, shall be terminated and be
null and void and neither party shall have any further rights or obligations
under this Agreement, or (ii) elect to accept title to the Property as it then
is. Failure by the Purchaser to elect to terminate this Agreement within the
time period specified shall be deemed acceptance by the Purchaser of title to
the Property subject to all matters disclosed in the Title Commitment, UCC
Searches or Survey and all such matters shall be deemed to be Permitted
Exceptions.
4. CLOSING.
1. Closing Date. The Closing of the transaction contemplated by this Agreement
shall occur at 10:00 a.m. Charleston, South Carolina time fifteen (15) days
after the expiration of the last to occur of (i) the Initial Due Diligence
Period (ii) the First Extension Period or (iii) the Second Extension Period, all
as hereinafter defined, or earlier with the written notice of Purchaser, which
notice shall be given at least ten (10) days prior to the proposed Closing. The
Closing shall occur at the offices of Seller or Seller's counsel, or at such
other time and place as Seller and Purchaser shall agree in writing.
The Closing Date shall be the date of Closing.
2. Closing Documents.
(1) At Closing, Seller shall deliver to Purchaser a copy of each of the
following:
(1) a special warranty deed, subject only to the Permitted Exceptions,
sufficient to transfer and convey to Purchaser fee simple title to the Property
as required by this Agreement, and otherwise in form reasonably acceptable to
the Escrowee;
(2) any and all affidavits, certificates or other documents reasonably and
customarily required by the Title Insurer in order to enable it to issue an
Owners Title Insurance Policy without exception for parties in possession or
mechanics liens created by Seller;
(3) a copy of such evidence of Seller's power and authority as the Title Insurer
reasonably requires;
(4) Seller's nonforeign affidavit, in the form attached hereto as Exhibit C;
(2) Purchaser. At Closing, Purchaser shall deliver or cause to be delivered to
Seller:
(1) the Cash Balance as required pursuant to Section 2(B) above; and
(2) executed counterparts of any other documents listed in Section 4(B)(i)
required to be signed by Purchaser.
3. Closing Prorations and Adjustments. A statement of prorations and other
adjustments shall be prepared by Purchaser in conformity with the provisions of
this Agreement and submitted to Seller for review and approval not less than two
(2) business days prior to the Closing Date. For purposes of prorations,
Purchaser shall be deemed the owner of the Property on the Closing Date,
provided Seller receives the Cash Balance from Purchaser by 2:00 p.m.
Charleston, South Carolina time on the Closing Date. Real estate taxes,
assessments, special taxes, special assessments and other tax or assessment
attributable to the Property through the Closing Date shall be prorated and
adjusted as of the Closing Date. If the tax statements for the fiscal year
during which the Closing Date occurs are not finally determined, then the tax
figures for the immediately prior fiscal year shall be used for the purposes of
prorating taxes on the Closing Date, with a further adjustment to be made after
the Closing Date as soon as the tax figures are finalized.
4. Closing Costs. Purchaser shall pay the cost of title insurance premiums
(including the cost of endorsements thereto), survey costs, recording charges
for the deed and one half of any fees charged by Escrowee in connection with the
Escrow Instructions. Transfer taxes, recording charges for lien releases and one
half of any fees charged by Escrowee in connection with the Escrow Instructions
shall be paid by Seller. Seller and Purchaser shall, however, be responsible for
the fees of their respective attorneys.
5. Possession. Upon Closing, Seller shall deliver to Purchaser full and complete
possession of the Property, subject only to the Permitted Exceptions.
5. CASUALTY LOSS AND CONDEMNATION.
If, prior to Closing, the Property or any part thereof shall be
condemned, or destroyed or materially damaged by casualty (that is, damage or
destruction which Seller reasonably believes would cost in excess of $50,000 to
repair), Seller shall provide Purchaser with written notice of such casualty and
Purchaser shall have the option either to terminate this Agreement or to
consummate the transaction contemplated by this Agreement notwithstanding such
condemnation, destruction or material damage. If Purchaser elects to consummate
the transaction contemplated by this Agreement, Purchaser shall pay the full
purchase price but shall be entitled to receive the condemnation proceeds or
settle the loss under all policies of insurance applicable to the destruction or
damage and receive the proceeds of insurance applicable thereto, and Seller
shall, at Closing and thereafter, execute and deliver to Purchaser all required
proofs of loss, assignments of claims and other similar items. If Purchaser
elects to terminate this Agreement, Purchaser shall provide written notice to
Seller to such effect on or before the date which is ten (10) days from the
Seller's notice to Purchaser of such casualty or on the Closing Date, whichever
occurs first, and the Earnest Money shall be returned to Purchaser by Escrowee,
in which event this Agreement shall, without further action of the parties,
become null and void and neither party shall have any further rights or
obligations under this Agreement.
6. REPRESENTATIONS AND WARRANTIES.
Seller represents and warrants to Purchaser that as of the date of
this Agreement Seller is duly organized, validly existing and qualified and
empowered to conduct its business, and has full power and authority to enter
into and fully perform and comply with the terms of this Agreement.
7. DUE DILIGENCE.
1. Initial Due Diligence Period. Purchaser shall have between the date hereof
and 5:00 p.m. Charleston, South Carolina time on the date which is ninety (90)
days from the date of this Agreement (the Initial Due Diligence Period) to
conduct such due diligence review of the Property and such other material it
deems appropriate. If Purchaser shall reasonably determine that it does not wish
to purchase the Property based on the results of such due diligence, Purchaser
shall be entitled to terminate this Agreement by giving written notice thereof
to Seller prior to the expiration of the Initial Due Diligence Period and
thereafter Seller and Purchaser shall have no further obligations or liabilities
to each other hereunder, except as stated herein. If Purchaser fails to give
such notice prior to the expiration of the Initial Due Diligence Period, then it
shall deposit an additional Ten Thousand Dollars ($10,000.00) (the Additional
Deposit) in escrow with the Escrowee and shall conclusively be deemed to be
satisfied with the results its diligence other than receipt of a building permit
and shall have elected to waive its right to terminate this Agreement under this
Section 7 and the Earnest Money shall become non-refundable to the Purchaser and
the property of the Seller, except as expressly set forth hereunder.
2. Extension of Initial Due Diligence Period. Notwithstanding anything to the
contrary contained in the Agreement provided that Purchaser makes the Additional
Deposit and applies for and diligently pursues obtaining a building permit from
the City of Charleston, the Initial Due Diligence Period shall be extended for
thirty (30) days (the First Extension Period). If, despite Purchasers diligent
efforts, the building permit has not been obtained prior to the expiration of
the First Extension Period, Purchaser shall have the right, to extend the First
Extension Period for an additional period of thirty (30) days (the Second
Extension Period) by so notifying Seller in writing and depositing prior to the
expiration of the First Extension Period an additional deposit of Ten Thousand
Dollars ($10,000.00) (the Second Additional Deposit) in escrow with the
Escrowee. If, despite Purchasers diligent efforts, the application for a
building permit is denied, the Earnest Money shall be refunded to Purchaser and
this Agreement shall be null and void without further recourse to either party
except for those provisions which are expressly intended to survive hereunder.
The Earnest Money shall otherwise be nonfundable after the expiration of the
Initial Due Diligence Period.
3. Inspection. During the Initial Due Diligence Period, Purchaser and its
agents, engineers, surveyors, appraisers, auditors and other representatives
shall have the right to enter upon the Property, provided Purchaser is
accompanied by a representative or agent of Seller, to inspect, examine, survey,
obtain engineering inspections and environmental studies, appraise, and
otherwise do that which, in the opinion of Purchaser, is necessary to determine
the boundaries, acreage and condition of the Property and to determine the
suitability of the Property for the uses intended by Purchaser. Notwithstanding
the foregoing, Purchaser shall (i) restore any damage caused by its entrance
onto or inspection of the Property to the condition that the Property was in
prior to commencing any tests, studies or investigations, and (ii) furnish to
Seller certificates of insurance evidencing such insurance reasonably required
by Seller and listing Seller and Purchaser as additional insureds thereunder.
4. Liens and Indemnity. Purchaser shall keep the Property free and clear of any
liens and will indemnify, defend and hold Seller harmless from and against any
and all loss, costs, actual damage or third party claims in any way arising from
Purchasers inspections or examinations of the Property prior to the Closing
Date, including reasonable attorney's fees, incurred by Seller as a result of
such entry or investigation by or on behalf of the Purchaser. This indemnity
obligation shall survive the termination of this Agreement for any reason.
5. Return Materials. If this Agreement is terminated pursuant to this Section 7,
Purchaser shall return all materials provided by Seller to Purchaser pertaining
to the Property or obtained by Purchaser in its due diligence as a condition
precedent to receiving the Earnest Money from the Escrowee.
8. BROKERAGE.
Seller agrees to pay the brokerage commission due for services
rendered in connection with the sale and purchase of the Property to Elcan &
Associates Inc. and Retail Properties, Inc. Said brokerage commission shall
become due and payable only upon a successful closing of the transaction
contemplated herein. Seller shall indemnify, defend and hold Purchaser harmless
for and against any and all claims of all brokers and finders claiming by,
through or under Seller and in any way related to the sale and purchase of the
Property pursuant to this Agreement, including without limitation, attorney's
fees incurred by Purchaser in connection with such claims. Purchaser shall
indemnify, defend and hold Seller harmless from and against any and all claims
of all brokers and finders (other than Elcan & Associates Inc. and Retail
Properties, Inc.) claiming by, through or under Purchaser and in any way related
to the sale and purchase of the Property pursuant to this Agreement, including,
without limitation, attorney's fees incurred by Seller in connection with such
claims.
9. DEFAULTS AND REMEDIES.
1. Seller's Default. Notwithstanding anything to the contrary contained in this
Agreement, if Seller fails to perform in accordance with the terms of this
Agreement, at Purchasers option, either (i) the Earnest Money shall be returned
to Purchaser as liquidated damages, at which time this Agreement shall be null
and void and neither party shall have any rights or obligations under this
Agreement, or (ii) Purchaser may waive such default and close. In the event that
Purchaser elects option (i) above, Purchasers right to receive the Earnest Money
shall be Purchasers sole and exclusive remedy against Seller. Further, Purchaser
acknowledges and agrees that (w) the Earnest Money is a reasonable estimate of
and bears a reasonable relationship to the damages that would be suffered by
Purchaser as a result of the failure of the Closing to occur due to a default by
Seller under this Agreement; (x) the actual damages suffered by Purchaser as a
result of such failure to occur of the Closing due to a default of Seller under
this Agreement would be extremely difficult and impractical to determine; (y)
Seller seeks to limit its liability under this Agreement to the amount of the
Earnest Money in the event this Agreement is terminated and the transaction
contemplated by this Agreement does not close due to a default of Seller under
this Agreement; and (z) the Earnest Money shall be and constitutes valid
liquidated damages.
2. Purchaser's Default. Notwithstanding anything to the contrary contained in
this Agreement, if Purchaser fails to perform in accordance with the terms of
this Agreement, the Earnest Money shall be forfeited to Seller as liquidated
damages (which shall be Seller's sole and exclusive remedy against Purchaser),
at which time this Agreement shall be null and void and neither party shall have
any rights or obligations under this Agreement. Seller acknowledges and agrees
that (i) the Earnest Money is a reasonable estimate of and bears a reasonable
relationship to the damages that would be suffered and costs incurred by Seller
as a result of having withdrawn the Property from sale and the failure of
Closing to occur due to a default of Purchaser under this Agreement; (ii) the
actual damages suffered and costs incurred by Seller as a result of such
withdrawal and failure to close due to a default of Purchaser under this
Agreement would be extremely difficult and impractical to determine; (iii)
Purchaser seeks to limit its liability under this Agreement to the amount of the
Earnest Money in the event this Agreement is terminated and the transaction
contemplated by this Agreement does not close due to a default of Purchaser
under this Agreement; and (iv) the Earnest Money shall be and constitutes valid
liquidated damages.
<PAGE>
11. SELLER'S APPROVAL RIGHTS.
A. Offer. The submission of a draft of this Agreement shall not constitute
an offer or a counteroffer, it being the express intention of the parties that
no agreement has been reached unless and until the Agreement has been fully
executed and delivered by all parties and the Escrow Agreement and Deposit are
made within three (3) days thereafter.
B. Approval of Aesthetics. Purchaser shall have between the date hereof
and 5:00 p.m. Charleston, South Carolina time on the date which is forty-five
(45) days from the date hereof to submit to Seller architectural renderings, in
such detail as Seller reasonably requires, of any and all buildings, including
without limitation all four sides of the buildings, signs, and landscaping (all
of which is hereinafter collectively referred to as the Renderings) proposed for
the Property by Purchaser or its agent or assigns. Within ten (10) days after
the submission of the Renderings, Seller shall either (i) approve the Renderings
or (ii) not approve the Renderings and propose changes thereto. If Seller does
not approve the Renderings, then Purchaser shall either (i) incorporate any and
all of Seller's changes into the design of the Renderings or (ii) terminate this
Agreement by giving written notice thereof to Seller prior to the expiration of
the Initial Due Diligence Period and thereafter Seller and Purchaser shall have
no further obligations or liabilities to each other hereunder, except as stated
herein.
Purchaser hereby covenants and agrees that all alterations, changes,
signage and any and all other improvements to the Property (the Improvements)
shall conform to the aesthetic design of the approved Renderings. If Seller
reasonably determines, at any time, that the Improvements do not conform to the
aesthetic design of the approved Renderings, then Purchaser shall correct the
Improvements promptly to conform to the aesthetic design of the approved
Renderings after receipt of written notice from the Seller to do so unless the
Seller gives written acceptance of such nonconformity to Purchaser. This
Paragraph shall survive Closing and shall apply to all Improvements.
13. MISCELLANEOUS.
A. Entire Agreement. This Agreement constitutes the entire agreement
between Seller and Purchaser with respect to the Property and shall not be
modified or amended except in a written document signed by Seller and Purchaser.
Any prior agreement or understanding between Seller and Purchaser concerning the
Property is hereby rendered null and void.
B. Time of the Essence. Time is of the essence regarding this Agreement.
In the computation of any period of time provided for in this Agreement or by
law, the day of the act or event from which the period of time runs shall be
excluded, and the last day of such period shall be included, unless it is a
Saturday, Sunday, or legal holiday, in which case the period shall be deemed to
run until the end of the next day which is not a Saturday, Sunday, or legal
holiday.
3. Notices. All notices, requests, demands or other communications required or
permitted under this Agreement shall be in writing and delivered personally or
by certified mail, return receipt requested, postage prepaid, by facsimile
transmission, or by overnight courier (such as Federal Express), addressed as
follows:
(1) If to Seller:
c/o PaineWebber Properties Incorporated
265 Franklin Street, 16th Floor
Boston, Massachusetts 02110
Phone: 617/439-8106
Facsimile: 617/345-8725
Attention: Peter Sullivan
With a copy to:
Goodwin Procter & Hoar, LLP
Exchange Place
Boston, Massachusetts 02109
Phone: 617/570-1995
Facsimile: 617/227-8591
Attention: Andrew Sucoff, Esq.
(2) If to Purchaser:
Kelly & Cohen Appliances, Inc.
2875 Needmore Road
Dayton, Ohio 45414
Phone: (937) 276-3931
Facsimile: (937) 276-8643
Attention: Chief Financial Officer
<PAGE>
With a copy to:
Chernesky, Heyman & Kress
1100 Courthouse Plaza, S.W.
Dayton, Ohio 45402
Phone: (937) 449-2800
Facsimile: (937) 449-2821
Attention: Edward M. Kress, Esq.
All notices given in accordance with the terms hereof shall be deemed
given and received when sent or when delivered personally. Either party hereto
may change the address for receiving notices, requests, demands or other
communication by notice sent in accordance with the terms of this Section.
4. Governing Law. This Agreement shall be governed and interpreted in accordance
with the laws of the State of South Carolina.
5. Successors and Assigns. Without the prior written consent of Seller,
Purchaser shall not, directly or indirectly, assign this Agreement or any of its
rights hereunder. Any attempted assignment in violation hereof shall, at the
election of Seller in its sole discretion, be of no force or effect and shall
constitute a default by Purchaser. Seller may freely assign its rights hereunder
to any and all third parties, and upon delivery to Purchaser of notice of such
an assignment, Seller shall be forever released from any and all of its
obligations and liabilities hereunder as of the date of delivery of said notice
to Purchaser. Seller may freely sell the Property to any and all third parties
so long as such sale of the Property is subject to the terms and conditions of
this Agreement.
6. Multiple Counterparts. This Agreement may be executed in any number of
identical counterparts, any or all of which may contain the signatures of fewer
than all of the parties but all of which shall be taken together as a single
instrument.
7. Condition of Property. Purchaser acknowledges that at Closing it will have
had an opportunity to conduct diligence on the Property and is acquiring the
Property in its current condition based on its diligence. Purchaser further
acknowledges that neither Seller nor its employees, agents or representatives
have made any representation or warranty as to the condition of the Property or
the presence or absence of any hazardous materials on, in, under or within the
Property or any portion thereof which survive closing hereunder. THE PURCHASER
ACKNOWLEDGES AND AGREES THAT THE PROPERTY IS TO BE CONVEYED BY THE SELLER TO THE
PURCHASER AS IS, WITH ALL FAULTS, AND SUBSTANTIALLY IN ITS CURRENT CONDITION.
THE PURCHASER FURTHER ACKNOWLEDGES AND AGREES THAT, EXCEPT AS EXPRESSLY
CONTAINED HEREIN, NEITHER THE SELLER NOR ANY AGENT, EMPLOYEE OR OTHER
REPRESENTATIVE OF THE SELLER (OR PURPORTED AGENT, EMPLOYEE OR OTHER
REPRESENTATIVE OF THE SELLER) HAS MADE ANY GUARANTEE, REPRESENTATION OR
WARRANTY, EXPRESS OR IMPLIED (AND THE SELLER SHALL NOT HAVE ANY LIABILITY
WHATSOEVER) AS TO THE VALUE, USES, HABITABILITY, CONDITION, DESIGN, OPERATION,
FINANCIAL CONDITION OR PROSPECTS, OR FITNESS FOR PURPOSE OR USE OF THE PROPERTY
(OR ANY PART THEREOF) OR ANY OTHER GUARANTEE, REPRESENTATION OR WARRANTY
WHATSOEVER, EXPRESS OR IMPLIED, WITH RESPECT TO THE PROPERTY (OR ANY PART
THEREOF). FURTHER, THE SELLER SHALL HAVE NO LIABILITY FOR ANY LATENT, HIDDEN, OR
PATENT DEFECT AS TO THE PROPERTY OR THE FAILURE OF THE PROPERTY, OR ANY PART
THEREOF, TO COMPLY WITH ANY APPLICABLE LAWS AND REGULATIONS. IN PARTICULAR, THE
PURCHASER ACKNOWLEDGES AND AGREES THAT ANY INFORMATION CONCERNING THE PROPERTY
PROVIDED BY SELLER TO PURCHASER OR ANY OTHER INFORMATION THE PURCHASER MAY HAVE
OBTAINED REGARDING IN ANY WAY ANY OF THE PROPERTY, INCLUDING WITHOUT LIMITATION,
ITS OPERATIONS OR ITS FINANCIAL HISTORY OR PROSPECTS FROM THE SELLER OR ITS
AGENTS, EMPLOYEES OR OTHER REPRESENTATIVES) IS DELIVERED TO THE PURCHASER AS A
COURTESY, WITHOUT REPRESENTATION OR WARRANTY AS TO ITS ACCURACY OR COMPLETENESS,
AND NOT AS AN INDUCEMENT TO ACQUIRE THE PROPERTY; THAT NOTHING CONTAINED IN SUCH
DELIVERIES SHALL CONSTITUTE OR BE DEEMED TO BE A GUARANTEE, REPRESENTATION OR
WARRANTY, EXPRESS OR IMPLIED, IN ANY REGARD AS TO ANY OF THE PROPERTY (EXCEPT AS
EXPRESSLY PROVIDED HEREIN); AND THAT THE PURCHASER IS RELYING ONLY UPON THE
PROVISIONS OF THIS AGREEMENT AND ITS OWN INDEPENDENT ASSESSMENT OF THE PROPERTY
AND ITS PROSPECTS IN DETERMINING WHETHER TO ACQUIRE THE PROPERTY. The provisions
of this paragraph shall survive Closing.
<PAGE>
SELLER:
WEST ASHLEY SHOPPES ASSOCIATES
By: PaineWebber Equity Partners Two Limited
Partnership, its General Partner
By: Second Equity Partners, Inc, its
General Partner
By: /s/Peter F. Sullivan
--------------------
Name: Peter F. Sullivan
Title: Vice President
PURCHASER:
KELLY & COHEN APPLIANCES, INC.
By: ________________
Name:
Title:
<PAGE>
<TABLE>
HUD-1 UNIFORM SETTLEMENT STATEMENT
US DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
TYPE OF LOAN: FILE NUMBER: LOAN NUMBER:
CONV. UNINS MORTGAGE INSURANCE CASE NUMBER:
<CAPTION>
NAME AND ADDRESS OF BORROWER: NAME AND ADDRESS OF SELLER:
<S> <C>
Kelly & Cohen Appliances West Ashley Shoppes Associates
2875 Needmore Road 265 Franklin Street, 15th Floor
Dayton, OH 45414 Boston, MA 02110
TIN: 43-1477___
NAME AND ADDRESS OF LENDER: SETTLEMENT AGENT:
N/A John H. Bennett, Jr.
16 Fulton Street
Charleston, SC 29401
PROPERTY LOCATION: PLACE OF SETTLEMENT:
Tract E, .881 acre parcel - West Ashley Shoppes Charleston, S. C.
Charleston, SC 351-09-00-057
SETTLEMENT DATE: 5/12/99
SUMMARY OF BORROWER'S TRANSACTION SUMMARY OF SELLER'S TRANSACTION
- --------------------------------- -------------------------------
GROSS AMOUNT DUE FROM BORROWER: GROSS AMOUNT DUE TO SELLER:
Contracted sales price $ 280,000.00 Contracted sales price $ 280,000.00
Personal property Personal property
Borrower's settlement charges 1,266.38
Adjustments for items paid by seller in advance Adjustments for items paid by seller
in advance
City/town taxes 0.00 City/town taxes 0.00
County taxes 0.00 County taxes 0.00
Assessments 0.00 Assessments 0.00
------------- -------------
GROSS AMOUNT DUE FROM BORROWER: 281,266.38 GROSS AMOUNT DUE TO SELLER 280,000.00
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
AMOUNTS PAID BY OR IN BEHALF OF BORROWER: REDUCTIONS IN AMOUNT DUE TO SELLER:
<S> <C>
Deposits or earnest money 20,104.53 Excess deposit
Principal amount of new loan(s) Settlement charges to seller 29,635.37
Adjustments for items unpaid by seller: Adjustments for items unpaid by seller:
City/town taxes 0.00 City/town taxes 0.00
County taxes 2,033.00 County taxes 2,033.00
Assessments 0.00 Assessments 0.00
------------ -------------
TOTAL PAID BY/FOR BORROWER 22,137.53 TOTAL REDUCTION AMOUNT DUE SELLER 31,668.37
CASH AT SETTLEMENT FROM/TO BORROWER CASH AT SETTLEMENT TO/FROM SELLER
Gross amount due from borrower 281,266.38 Gross amount due to seller 280,000.00
Less amounts paid by/for borrower (22,137.53) Less reductions in amount due seller (31,668.37)
------------ -------------
CASH FROM BUYER $ 259,128.85 CASH TO SELLER $ 248,331.63
============ =============
/s/ Peter F. Sullivan
-----------------
</TABLE>
<PAGE>
SETTLEMENT CHARGES
PAID FROM PAID FROM
BORROWER'S SELLER'S
FUNDS AT FUNDS AT
SETTLEMENT SETTLEMENT
---------- ----------
Sales/Broker's commission based on price
$280,000.00 @ 10% = 2,800.00
Division of commission as follows:
$14,000.00 to Retail Properties, Inc.
$14,000.00 to Elcan & Associates, Inc.
Commission paid at Settlement $ 28,000.00
TITLE CHARGES
Settlement/closing fee
Abstract/title search to Lynn L. Crooks, P.A. $ 52.00
Title examination
Title insurance binder to Stewart Title Insurance 30.00
Document preparation
Notary fees
Attorney's fees to John H. Bennett, Jr. 350.00 350.00
Title insurance to Stewart Title Insurance 590.00
Lender's coverage
Owner's coverage: $280,000.00
Attorney's fees - Lynn L. Crooks, P.A. 219.38 219.37
GOVERNMENT RECORDING
AND TRANSFER CHARGES
Recording fees: Deed: $10.00 10.00
City/County/tax/stamps: Deed $1,036.00 1,036.00
State tax/stamps: Deed: Mortgage:
ADDITIONAL SESTTLEMENT CHARGES
Survey
Pest Inspection
Wire transfer 15.00
Courier 15.00 15.00
----------- -----------
TOTAL SETTLEMENT CHARGES $ 1,266.38 $ 29,636.37
