SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
Current Report Pursuant
to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported) March 4, 1999
WINTHROP MIAMI ASSOCIATES LIMITED PARTNERSHIP
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(Exact Name of Registrant as Specified in Its Charter)
Delaware
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(State or Other Jurisdiction of Incorporation)
33-45291 04-3131735
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(Commission File Number) (I.R.S. Employer Identification No.)
Cambridge Center, 9th Floor, Cambridge, Massachusetts 02142
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(Address of Principal Executive Offices) (Zip Code)
(617) 234-3000
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(Registrant's Telephone Number, Including Area Code)
N/A
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(Former Name or Former Address, if Changed Since Last Report)
<PAGE>
Item 2. Acquisition or Disposition of Assets
On March 4, 1999, the assets of Miami Tower Associates Limited
Partnership and Miami Retail Associates Limited Partnership (individually, an
"Operating Partnership" and collectively, the "Operating Partnerships"),
entities in which the Registrant holds an 88% interest, were sold to an
unaffiliated third party for a purchase price of $72,833,000. After satisfaction
of all closing costs and the indebtedness encumbering the assets, the net
proceeds to the Operating Partnerships were approximately $32,000,000. However,
pursuant to the terms of the Agreement of Purchase and Sale, the Operating
Partnerships agreed not to distribute to the Registrant $1,000,000 of the net
sale proceeds for a period of 18 months from the closing, which amount would be
released if at such date the purchaser has not filed a written claim against the
Operating Partnerships for breach of representation or warranty under the
Agreement of Purchase and Sale.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
(b) Pro Forma Financial Information:
The required pro forma financial information will be provided in
Registrant's Annual Report on Form 10-KSB for the year ended December 31, 1998.
(c) Exhibits
10. Agreement for Purchase and Sale
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized this 8th day of March, 1999.
WINTHROP MIAMI ASSOCIATES LIMITED PARTNERSHIP
By: One International Associates, L.P.,
Its General Partner
By: One International, Inc.,
its General Partner
By: /s/ Michael L. Ashner
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Michael L. Ashner,
Chief Executive Officer
<PAGE>
EXHIBIT INDEX
Exhibit Page
------- ----
10. Agreement of Purchase and Sale, among Miami 5
Retail Associates Limited Partnership and
Miami Tower Associates Limited Partnership and
National Office Partners Limited Partnership,
dated December 31, 1998.
<PAGE>
Exhibit 10
AGREEMENT OF SALE AND PURCHASE
by and between
MIAMI RETAIL ASSOCIATES LIMITED PARTNERSHIP AND
MIAMI TOWER ASSOCIATES LIMITED PARTNERSHIP,
BOTH FLORIDA LIMITED PARTNERSHIPS,
AS SELLER
and
NATIONAL OFFICE PARTNERS LIMITED PARTNERSHIP,
A DELAWARE LIMITED PARTNERSHIP,
AS PURCHASER
NATIONSBANK TOWER
MIAMI, FLORIDA
<PAGE>
55
Table of Contents
ARTICLE 1. Sale and Purchase.................................................4
ARTICLE 2. Consideration for Conveyance......................................6
ARTICLE 3. Earnest Money.....................................................6
ARTICLE 4. Survey and Title Policy...........................................7
4.1 Permitted Exceptions................................................7
4.2 Survey..............................................................8
4.3 Title Commitment....................................................8
4.4 Survey and Title Commitment Review..................................8
ARTICLE 5. Additional Items to be Furnished to Purchaser by Seller...........10
5.1 Submission Items....................................................10
5.2 Additional Submission Items.........................................11
5.3 Confidentiality.....................................................11
5.4 Information.........................................................11
5.5 Tenant Estoppels....................................................12
5.6 Ground Lease and Parking Rights Agreement Estoppels and Consent.....12
5.7 Evidence of Partner Consent.........................................13
5.8 City Lease Amendment................................................13
5.9 Lighting Rights Agreements and Rooftop License Agreements...........13
ARTICLE 5A. Representations and Warranties...................................14
5A.1 Purchaser's Representations and Warranties.......................14
5A.2 Seller's Representations and Warranties..........................14
ARTICLE 6. Inspection and Audit..............................................23
6.1 Inspection Period...................................................23
6.2 Condition of Subject Properties.......................................24
6.3 Underground Storage Tank Inspection Period...............................21
ARTICLE 7. Damage or Destruction Prior to the Closing........................25
7.1 Damage or Destruction...............................................25
7.2 Purchaser's Option..................................................26
7.3 Purchaser's Option Less than Threshold Amount.......................26
7.4 Estimated Cost of Repair, Replacement and Restoration...............27
7.5 Condemnation........................................................27
ARTICLE 8. Condition of Property.............................................27
8.1 Condition Of Property...............................................27
8.2 Purchaser's Additional Waivers......................................28
8.3 Management of Subject Properties....................................28
8.4 Modification or Renewals of Leases..................................29
8.5 Personal Property...................................................30
8.6 Further Encumbrances................................................30
8.7 Copies of Documents.................................................31
8.8 Notices.............................................................31
8.9 contracting Prior to Closing........................................31
8.10 Construction........................................................31
8.11 Ground Leases, Parking Rights Agreements and Lighting Rights........31
Agreement
8.12 No Negotiations.....................................................32
ARTICLE 9. Closing...........................................................32
9.1 Date of Closing.....................................................32
9.2 Purchaser's Conditions to Closing...................................32
9.3 Seller's Closing Conditions.........................................33
9.4 Delivery of Items At Closing By Seller..............................34
9.5 Delivery of Items at Closing By Purchaser...........................36
9.6 Prorations..........................................................36
9.5 Errors and Omissions................................................39
9.6 Purchaser's Costs......................................................39
9.7 Seller's Costs......................................................39
9.8 Possession..........................................................40
ARTICLE 10. Real Estate Commission...........................................40
10.1 Commissions......................................................40
ARTICLE 11. Remedies on Default..............................................41
11.1 Termination Of Contract By Purchaser.............................41
11.2 Purchaser's Default..............................................41
11.3 Seller's Default.................................................41
11.4 Failure of Conditions............................................42
ARTICLE 12. Miscellaneous....................................................42
12.1 Notices..........................................................42
12.2 Effective Date...................................................43
12.3 Assignment.......................................................44
12.4 Laws.............................................................44
12.5 Modification.....................................................44
12.6 Authority........................................................44
12.7 Times And Dates..................................................44
12.8 Descriptive Headings.............................................44
12.9 Entire Contract..................................................45
12.10 Construction.....................................................45
12.11 Non-recordable...................................................45
12.12 Third-Party Beneficiary..........................................45
12.13 Legal Relationship...............................................45
12.14 Indemnification..................................................45
12.15 Return of Documents..............................................46
12.16 Effect of Holidays...............................................46
12.17 Completion of Documents..........................................47
12.18 Non-Imputation...................................................47
12.19 Severability.....................................................47
12.20 Title Company....................................................48
12.21 Attorneys Fees...................................................50
12.22 Press Releases...................................................50
12.23 Multiple Counterparts............................................50
12.24 Personal Property and Office Space...............................50
Exhibits
A - Legal Description
B - Personal Property List
C - Phase I Environmental Report
D - Tenant Estoppel Certificate
E - Form of Consent and Estoppel Agreement re: Ground Lease
F - Form of Estoppel Certificate re: Parking Rights Agreement
G - City Lease Amendment
H - Assignment and Assumption re: Ground Leases
I - Assignment and Assumption re: Parking Rights Agreement
J - Quitclaim Deed [Improvements]
K - Bill of Sale and General Assignment
L - Assignment and Assumption Agreement re: Miscellaneous Contracts and
Other Rights
M - Notice to Tenants
N - Certification of Non-Foreign Status
Schedules
5.1(d) - TI Contracts
5.1(e) - List of Miscellaneous Contracts
5A.2(g)(1) - Rent Roll
5A.2(g)(3) - Subleases
5A.2(g)(9) - Leasing Commission Agreements
5A.2(m) - Licenses and Permits
8.4 - Proposed Leases
<PAGE>
AGREEMENT OF SALE AND PURCHASE
THIS AGREEMENT OF SALE AND PURCHASE ("Contract") is entered into as of the
Effective Date (as defined in Section 12.2 below) by and between MIAMI RETAIL
ASSOCIATES LIMITED PARTNERSHIP, a Florida limited partnership and MIAMI TOWER
ASSOCIATES LIMITED PARTNERSHIP, a Florida limited partnership (collectively
referred to herein as "Seller") and NATIONAL OFFICE PARTNERS LIMITED
PARTNERSHIP, a Delaware limited partnership ("Purchaser").
ARTICLE 1. Sale and Purchase
Subject to the terms and provisions hereof, Seller agrees to sell to
Purchaser, and Purchaser agrees to purchase from Seller:
(a) all right, title and interest of Seller in and to the real property
described on Exhibit "A" attached hereto and made a part hereof, together with
all right, title and interest of Seller in and to any and all strips or gores,
roads, appurtenances, easements, streets and ways bounding such real property,
and rights of ingress and egress thereto (the "Land");
(b) the entire interest of the lessee in and under that certain Lease
Agreement dated July 30, 1985 (the "Retail Lease") between The City of Miami, a
Municipal corporation of the State of Florida, as landlord, and Centrust Realty
and Construction Company, a Florida corporation, as tenant, as evidenced by the
Short Form of Lease Agreement, recorded on April 14, 1987, in Official Records
Book 13247, Page 440, which Lease Agreement was assumed by C.P. Retail, Ltd., a
Florida limited partnership, and was further assumed by Miami Retail Associates
Limited Partnership, a Florida limited partnership, together with any
modifications, assignments, riders or amendments thereto (including that certain
Maintenance Agreement made the 21st day of July 1986, among the City of Miami
Department of Off-Street Parking, C.P. Retail Ltd. and C.P. Tower Ltd.);
(c) the entire interest of the lessee in and under that certain Lease
Agreement dated July 1, 1980 (the "Air Rights Lease") and recorded in Official
Records Book 10830, at Page 569 of the Public Records of Dade County, Florida,
between The City of Miami, a Municipal corporation of the State of Florida, as
landlord, and Dade Savings and Loan Association, as tenant, a counterpart of
which was recorded in Official Records Book 10820, at Page 1289, as assumed by
C.P. Tower, Ltd., a Florida limited partnership and as further assumed by Miami
Tower Associates Limited Partnership, a Florida limited partnership, together
with any and all modifications, assignments, riders or amendments thereto
(including that certain Maintenance Agreement made the 21st day of July 1986,
among the City of Miami Department of Off-Street Parking, C.P. Retail Ltd. and
C.P. Tower Ltd.) (collectively, the Retail Lease and Air Rights Lease are
sometimes referred to herein as the "Ground Leases") (collectively, the Land and
Ground Leases are sometimes referred to herein as the "Real Property");
(d) all of Seller's right, title and interest in and to all improvements
situated upon the Real Property owned by Seller, including, but not by way of
limitation, those certain buildings, structures, fixtures and other improvements
of every kind and nature presently situated on, in, under or hereafter erected,
installed or used in, or about the Real Property and commonly known as
Nationsbank Tower, Miami, Florida (collectively, the "Improvements");
(e) all of Seller's right, title and interest in and to all personal
property of every kind and nature now or hereafter installed, located, situated
or used in, on or about, or in connection with the operation, use and enjoyment
of the Real Property or the Improvements including, without limitation, all
equipment, computers and software, air conditioning, heating and ventilating
systems, all other mechanical systems, all carpets and other floor coverings,
all drapes, shades and other window coverings, all furnishings and furniture,
and all maintenance and other equipment, if any, affixed or located upon the
Real Property or the Improvements, including, without limitation, the personal
property listed on Exhibit "B", attached hereto and made a part hereof
(collectively, the "Personal Property");
(f) all of Seller's right, title and interest in and to all intangible
property used by Seller in connection with all or any portion of the Real
Property and/or the Improvements and/or the Personal Property, including,
without limitation, all of Seller's right, title and interest in, to and under:
(i) the Leases (as defined in Section 5A.2(g) herein) and security deposits; all
contract rights (including, without limitation, (x) the Miscellaneous Contracts
(as defined herein) (except to the extent terminated pursuant to the terms of
this Contract), (y) that certain Retail Parking Agreement dated July 21, 1986
between the Department of Off Street Parking and C.P. Retail, Ltd., as assigned
to Seller and that Certain Tower Parking Agreement dated July 21, 1986 between
the Department of Off Street Parking and C.P. Tower, Ltd., as assigned to Seller
(collectively, the "Parking Rights Agreements"), and (z) that certain (a) Permit
Agreement between C.P. Tower, Ltd., a Florida limited partnership, and the Metro
Dade Transit Agency, which commenced January 16, 1987, as assigned to Seller, as
extended by letter dated November 17, 1998 (b) Roof Lease Agreement between
Ultramont Properties, N.V. and Miami Tower Associates Limited Partnership, dated
January 1, 1995; and (c) Lease Agreement between Moreno Habit, as Trustee and
Centrust Realty and Construction Company, dated October 4, 1985, as amended by
Letter Amendment, dated January 22, 1987, as assigned to Seller (collectively,
the Lighting Rights Agreements"); books, records, reports, test results,
environmental assessments, if any, as-built plans, specifications and other
similar documents and materials relating to the use, operation, maintenance,
repair, construction or fabrication of all or any portion of the Real Property
and/or the Improvements and/or the Personal Property; (ii) all rights, if any,
in and to any trade name used in connection with the Real Estate or
Improvements, including, without limitation, the name "NationsBank Tower"; (iii)
all transferable business licenses, architectural, site, landscaping or other
permits, applications, approvals, certificates of occupancy, authorizations,
franchises, utility rights, unexpired claims and other entitlements affecting
any portion of the Real Property; and (iv) all transferable guarantees,
warranties and utility contracts relating to all or any portion of the Real
Property (collectively, the "Intangible Property"); and
(g) All right, title and interest of Seller in and to any unpaid insurance
claims or proceeds or awards for damages to the Land and/or Improvements
resulting from any casualty or any taking in eminent domain or by reason of
change of grade of any street (the "Awards").
The Real Property, Improvements, Personal Property, Intangible Property and
Awards are hereinafter collectively referred to as the "Subject Properties".
ARTICLE 2. Consideration for Conveyance
The purchase price for the Subject Properties is Seventy Two Million
($72,000,000) Dollars (the "Purchase Price"), subject to adjustment for all
credits, prorations and closing costs provided for in this Contract, which shall
be due and payable in cash or by wire transfer of immediately available federal
funds at the closing of the transaction contemplated by this Contract
("Closing").
ARTICLE 3. Earnest Money
Within one (1) business day after the Effective Date, Purchaser shall
deliver to Seller the amount of $100.00 (the "Independent Consideration") as
independent consideration for Purchaser's rights granted under Article 6 hereof.
The Independent Consideration shall be non-refundable to Purchaser in the event
of any termination of this Contract. Before the expiration of the Inspection
Period (as defined in Section 6.2 herein) and provided Purchaser shall not have
terminated this Agreement, Purchaser shall deliver to the Title Company (as
defined in Section 4.3) as earnest money (into an escrow established in the
Title Company's San Francisco, California office) by wire transfer of
immediately available federal funds, or cashier's check the amount of Two
Million Dollars ($2,000,000) (the "Earnest Money"). Purchaser shall also provide
the Title Company with its federal tax identification number. The Title Company
shall hold and disburse the Earnest Money in accordance with Section 12.20 of
this Contract. Interest derived on the Earnest Money shall become part of the
Earnest Money and shall be paid to the party entitled to the Earnest Money in
accordance with the terms hereof. If the sale contemplated by this Contract is
consummated in accordance with the terms hereof, the Earnest Money shall be
applied to the Purchase Price to be paid to Seller at the Closing.
In the event the Title Company cannot comply with the obligations pursuant
to this Article, Purchaser and Seller shall mutually select another title
company. The Title Company must sign this Contract as evidence that the Title
Company agrees to be bound by the obligations contained herein.
IT IS EXPRESSLY UNDERSTOOD AND AGREED THAT UNLESS EXPRESSLY PROVIDED HEREIN
TO THE CONTRARY, UPON THE EXPIRATION OF THE INSPECTION PERIOD (AS DEFINED IN
SECTION 6.2 HEREOF), THE EARNEST MONEY SHALL THEREAFTER BE NONREFUNDABLE TO
PURCHASER.
ARTICLE 4. Survey and Title Policy
4.1 Permitted Exceptions. The Subject Properties are sold and are to be
conveyed subject to the following (hereinafter the "Permitted Exceptions"):
(a) Real estate taxes and special assessments for the current fiscal year
not yet due and payable which shall be prorated pursuant to the terms of this
Contract;
(b) the Ground Leases;
(c) the Parking Rights Agreements;
(d) the Leases (as defined below);
(e) Zoning and building laws, restrictions, regulations and ordinances of
the municipality in which the Real Property is located, if any (excluding any
violations of the same that arise after the Effective Date); and
(f) any matters not objected to or otherwise waived by Purchaser under
Section 4.4 hereof, and any matters objected to by Purchaser prior to the
expiration of the Title Inspection Period which the Title Company (as such term
is defined in Section 4.3 hereof) is willing to affirmatively insure pursuant to
an endorsement in form and substance satisfactory to Purchaser.
4.2 Survey. By Purchaser's execution of this Contract, Purchaser
acknowledges receipt of a survey of the Real Property and Improvements as
prepared by Biscayne Engineering Company, Inc., dated March 25, 1997 (the
"Survey"). On or before January 5, 1999, Seller shall use all reasonable efforts
to cause the Survey to be updated/revised and recertified in favor of Purchaser
to a date subsequent to the Effective Date (the "Updated Survey") at Seller's
sole cost and expense. Any matter identified on the Survey must be objected to
by the Purchaser prior to the expiration of the Title Inspection Period in
accordance with the provisions of Section 4.4 hereof or it shall be deemed a
Permitted Exception. If this Contract is terminated, Purchaser will return the
Survey and any copies thereof to Seller.
4.3 Title Commitment. By Purchaser's execution of this Contract, Purchaser
acknowledges receipt of: (i) a commitment for the issuance of an Owner's Policy
of Title Insurance (the "Title Commitment") from Commonwealth Land Title
Insurance Company (the "Title Company"), together with copies of all documents
constituting exceptions to Seller's title as reflected in the Title Commitment;
and (ii) UCC, tax, judgment and lien searches covering Seller and the Subject
Properties (the "Searches").
4.4 Survey and Title Commitment Review. Purchaser shall have until January
12, 1999 (the "Title Inspection Period") to review the Survey, the Searches, the
Title Commitment and the documents referred to therein, and all documents and
other materials pertaining to land use and zoning (the "Zoning Materials"), and
to deliver to Seller in writing such objections as Purchaser may have to
anything contained or set forth in the Title Commitment, the Searches, Survey or
the Zoning Materials (provided, however, notwithstanding anything to the
contrary, Purchaser shall have an additional three (3) business days, regardless
of the passage of the Title Inspection Period, following Purchaser's receipt of
any updates to the Title Commitment, the Searches and the Survey to notify
Seller of objections to items shown on any such updates which were not disclosed
on the previously delivered reports). Except as provided in the immediately
preceding sentence, any item to which Purchaser does not object prior to the
expiration of the Title Inspection Period shall be deemed to be a "Permitted
Exception". As to items to which Purchaser makes objections, Seller: (a) shall
cure and payoff all mortgages, judgments and other liens of parties claiming by,
through or under Seller which affect the Subject Properties which can be
discharged by the payment of an uncontested liquidated monetary obligation and
shall otherwise discharge and satisfy all matters described in Schedule B,
Section 1 of the Title Commitment(the "Liens"); and (b) may elect, in its sole
discretion, to cure such other objections (the "Proviso (b) Objections"), such
cure to include, but not limited to, the Title Company providing affirmative
insurance over such objection(s) pursuant to an endorsement reasonably
satisfactory to Purchaser. In the event Seller elects not to cure the Proviso
(b) Objections prior to the Closing, Seller will notify Purchaser of such
election and Purchaser shall have the right, within five (5) days after Seller's
notice, to either (i) terminate the Contract, in which event Purchaser shall
receive a full refund of the Earnest Money, and no party hereto shall have any
further rights hereunder except for Purchaser's liability pursuant to Articles 6
and 10 hereof and Seller's liability pursuant to Article 10 hereof, or (ii)
waive such title and survey matters, without any reduction in the Purchase
Price, and proceed to the Closing, whereupon such waived title and survey
matters shall also be deemed "Permitted Exceptions".
In the event Seller elects to cure any Proviso (b) Objection and Seller is
unable in good faith to cure same by the Closing, then Seller may extend the
Closing for a period of time thereafter in order to cure same, but in no event
shall the Closing be extended for more than thirty (30) days after the
originally scheduled date (as same shall be amended pursuant to the terms of
this Contract). If cure is unable to be effected within such extended thirty-day
period, then Seller will notify Purchaser of its inability to effectuate a cure
and Purchaser shall have the right, within five (5) days after Seller's notice,
to either (i) terminate the Contract, in which event Purchaser shall receive a
full refund of the Earnest Money, and no party hereto shall have any further
rights hereunder except for Purchaser's liability pursuant to Articles 6 and 10
hereof and Seller's liability pursuant to Article 10 hereof, or (ii) waive such
title and survey matters, without any reduction in the Purchase Price, and
proceed to the Closing, whereupon such waived title and survey matters shall
also be deemed "Permitted Exceptions".
Seller agrees that it shall be a condition precedent to Purchaser's
obligation to close the transactions contemplated by this Contract, that the
Title Company will, upon payment of its standard charges and premiums by Seller
and receipt of Seller's Affidavit of Title, issue the Owner's Title Policy (as
hereinafter defined). As used herein, "Owner's Title Policy" shall mean an ALTA
Owner's Policy of Title Insurance (Form B, 1970 extended coverage with 1984
modifications, including the creditor's rights exemption) dated as of the
Closing, issued by the Title Company with such re-insurance as Purchaser may
reasonably require in favor of Purchaser in the amount of the Purchase Price,
insuring fee simple title to the Subject Properties as of the Closing, deleting
standard exceptions 1 through 5, subject only to Permitted Exceptions and
containing the following endorsements: Florida Form 9 (affirmative coverage for
restriction violations), access and survey.
ARTICLE 5. Additional Items to be Furnished
to Purchaser by Seller
5.1 Submission Items. Within three (3) business days after the Effective
Date, Seller shall furnish to Purchaser copies of the following:
(a) True, correct and complete copies of the Ground Leases;
(b) True, correct and complete copies of the Parking Rights Agreements;
(c) True, correct and complete copies of the Lighting Rights Agreements;
(d) True, correct and complete copies of any and all outstanding tenant
improvement contracts and/or capital contracts which are set forth on Schedule
5.1(d) attached hereto and made a part hereof (collectively referred to herein
as "TI Contracts") affecting the Subject Properties.
(e) True, correct and complete copies of all written service contracts,
commission agreements, warranties or other agreements affecting the operation of
the Subject Properties which are set forth on Schedule 5.1(e) attached hereto
and made a part hereof (herein collectively the "Miscellaneous Contracts").
Purchaser shall assume all of the Miscellaneous Contracts at Closing, with the
exception of: (i) Seller's leasing and management agreement with Winthrop
Management ("Manager"), which shall be terminated by Seller, at Seller's cost,
if any, on or prior to Closing; and (ii) those Miscellaneous Contracts which
Purchaser identifies to Seller prior to the expiration of the Inspection Period,
which Miscellaneous Contracts will be terminated by Seller, provided adequate
notice is given by Purchaser to Seller to enable Seller to terminate the
Miscellaneous Contracts and such termination is without cost or expense to
Seller.
(f) The most recent tax statements on the Subject Properties.
(g) A list of the Personal Property certified as true and correct.
(h) Roof-Window Cleaning Machine Permits, Elevator Permits, Electrical and
Mechanical Plans, and Architectural Plans and Building Specifications (which
shall be made available at the Real Property).
(i) Such other documents as Purchaser may reasonably request and which are
in the possession of the Seller or Manager, including, without limitation, true,
correct and complete copies of the Leases which shall be made available at the
Real Property.
5.2 Additional Submission Items. With the execution of this Contract the
Purchaser hereby acknowledges the receipt of a Phase I Environmental Site
Assessment Report and Asbestos Assessment Survey both dated June 1991 and
prepared by Environmental Science and Engineering, Inc. the cover page of each
report of which is attached hereto as Exhibit "C" and made a part hereof for
identification purposes, and a letter dated December 30, 1998 from EE&G directed
to the City of Miami - Division of Off-Street Parking also attached hereto as
Exhibit "C" and made a part hereof (the "Environmental Reports").
The items described in Sections 5.1 and 5.2 are hereinafter collectively
referred to as the "Submission Items."
5.3 Confidentiality. Seller and Purchaser and their representatives,
including any brokers or other professionals, shall keep the existence and terms
of this Agreement and all of the Submission Items and any other reports,
documents or information given by Seller to Purchaser strictly confidential,
except to the extent disclosure is compelled by court order, law or any
securities reporting requirements, and then only to the extent of such
compulsion, and except potential lenders, managers, underwriters, investors and
the like and their agents, employees, consultants, managers, accountants,
lawyers and other professional advisors on a need to know basis or third parties
to the extent contemplated herein.
5.4 Information. As an essential inducement to Seller to sell the Subject
Properties to Purchaser on the favorable terms and conditions set forth in this
Contract, Purchaser acknowledges and agrees that (except for the
representations, warranties and covenants of Seller set forth herein and in
Seller's Closing Documents (as hereinafter defined), or as otherwise provided
herein): (i) all documents, materials, reports, studies and other information
delivered or disclosed to Purchaser by Seller (the "Information") are being
provided to Purchaser for informational purposes only and only as an
accommodation to Purchaser; (ii) Seller had not made, is not making, and will
not make any representation, warranty or promise of any kind, express or
implied, concerning the accuracy or completeness of all or any part of the
Information; and (iii) any inaccuracy, incompleteness, or deficiency in any part
of the Information shall be solely the risk and responsibility of Purchaser,
shall not be chargeable in any respect to Seller, and shall not form the basis
of any claims by Purchaser against Seller, its employees, agents, or assigns
such claims being expressly waived and relinquished by Purchaser.
5.5 Tenant Estoppels. Within five (5) business days after expiration of the
Inspection Period, Seller shall deliver to all tenants occupying space in the
Improvements the form of estoppel (the "Form Estoppel") attached hereto as
Exhibit "D" completed to include the applicable information requested therein
from each tenant together with a written demand that each of such tenants return
such estoppel within ten (10) days after its receipt thereof. This act by Seller
places no duty or obligation upon Seller except to deliver the estoppel with
such request as provided above and use reasonable efforts to obtain such Form
Estoppels signed by all Tenants occupying space in the Improvements by February
16, 1999. In the event a Form Estoppel, free from any material and adverse
exception, qualification or modification (provided, however any estoppel
delivered by a Tenant free from any material and adverse exception in the form
required by their respective Lease shall be deemed acceptable), is not delivered
to Purchaser from: (i) all of the tenants whose leases demise at least one (1)
full floor or more of the Improvements (the "Major Tenants"), and (ii) at least
seventy-five percent (75%) of the square footage other than the Major Tenants
(collectively, Purchaser's receipt of the Form Estoppel pursuant to this
sentence shall be referred to hereinafter as the "Minimum Estoppel
Requirement")by February 16, 1999, Seller shall not be deemed to have breached
this Contract, but Purchaser shall have the option of terminating this Contract
in accordance with Section 6.2 herein as its sole remedy.
5.6 Ground Lease and Parking Rights Agreement Estoppels and Consent. Seller
shall use its reasonable efforts to deliver to Purchaser on or before February
16, 1999 (i) a consent and estoppel agreement from the City of Miami, Florida, a
Municipal Corporation in favor of Purchaser in substantially the same forms as
Exhibit "E" attached hereto with respect to the Retail Lease and the Air Rights
Lease; and (ii) Estoppel Agreements from the Department of Off-street Parking of
the City of Miami in favor of Purchaser in substantially the same forms as
Exhibit "F" attached hereto with respect to the Parking Rights Agreement. If
Seller is unable, after reasonable effort, to obtain the aforementioned
agreements, Seller shall not be deemed to have breached this Contract, but
Purchaser shall have the option of terminating this Contract in accordance with
Section 6.2 herein as its sole remedy.
5.7 Evidence of Partner Consent. Seller shall use its reasonable efforts to
deliver to Purchaser on or before February 16, 1999 evidence, reasonably
satisfactory to Purchaser, that it has obtained the consent of a majority in
interest of the limited partners of Winthrop Miami Associates Limited
Partnership to the sale of the Subject Properties pursuant to the terms of this
Contract ("Partner Consent"). If Seller fails to notify Purchaser that such
consent has been obtained on or before February 16, 1999, then Seller shall be
conclusively deemed to have not obtained such consent. If such consents are not
obtained, then Earnest Money and all interest earned thereon shall be promptly
returned to Purchaser, Seller shall pay Purchaser $250,000 as liquidated damages
and this Contract shall be null and void and no party shall have any further
liability to the other hereunder except for Purchaser's liabilities under
Articles 6 and 10 hereof and Seller's liability under Article 10 hereof. Seller
and Purchaser agree that in the event such consent is not obtained by Seller,
the damages that Purchaser may sustain as a result thereof would be difficult,
if not impossible, to ascertain. Therefore, Seller and Purchaser agree that the
Earnest Money and all interest thereon shall be paid to Purchaser and Seller
shall pay Purchaser $250,000 as full and complete liquidated damages and as
Purchaser's sole remedy.
5.8 City Lease Amendment. Seller shall use its reasonable efforts to
deliver to Purchaser on or before Closing an Amendment to Lease Agreement in
substantially the same form as Exhibit "G" attached hereto (provided, however,
any modification to such form requested by the landlord thereof shall not
increase the liability of the lessee in any material respect). If Seller is
unable, after reasonable effort, to obtain such Amendment, Seller shall not be
deemed to have breached this Contract, but Purchaser shall have the option of
termination of this Contract in accordance with Section 6.2 herein as its sole
remedy.
5.9 Lighting Rights Agreements and Rooftop License Agreements. Seller shall
use reasonable efforts to deliver to Purchaser on or before Closing letters from
(i) the landlords of the Lighting Rights Agreements and (ii) the licensees under
the following rooftop licenses: Metro Traffic; Motorola/Nextel; Motorola/Grand
Hablad; MetroCall; Interactive Broadcasting; WTVJ; and Geotech confirming the
current status of such agreements, in form and substance reasonably satisfactory
to Purchaser. This act by Seller places no duty or obligation on Seller other
than its agreement to use reasonable efforts to obtain such letters and shall
not be a condition to Purchaser's obligations to close under the terms and
conditions of this Contract.
ARTICLE 5A. Representations and Warranties
5A.1 Purchaser's Representations and Warranties. Purchaser hereby
represents and warrants to Seller, which representations and warranties shall be
true and correct as of the date hereof and as of the Closing:
(a) Legal Existence. Purchaser is a limited partnership duly organized and
validly existing under the laws of the State of Delaware;
(b) Authority. The execution of this Contract and the consummation of all
transactions contemplated hereunder: (i) are within the powers of Purchaser;
(ii) have been duly authorized by appropriate action; and (iii) will not
conflict with, result in any breach of any of the provisions of, or constitute a
default (or an event which upon the giving of any required notice or lapse of
time would constitute a default) under Purchaser's organizational documents or
the provisions of any agreement, court or administrative order, consent decree,
or other instrument to which Purchaser is a party;
(c) Enforceability. This Contract has been duly executed and delivered by
Purchaser, and is the legal, valid and binding obligation of Purchaser,
enforceable against Purchaser in accordance with its terms, except as
enforcement thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the rights of creditors
generally and by equitable principles (whether or not such enforceability is
considered in a proceeding at law or in equity);and
(d) Litigation. There are not (and, in the event Purchaser assigns its
rights hereunder as provided for in this Contract to any entity, there will not
be against such assignee), any actions, suits, or proceedings, pending or
threatened, against Purchaser (or such assignee) in any court or before any
administrative agency which would prevent Purchaser (or such assignee) from
completing the transactions provided for herein.
5A.2 Seller's Representations and Warranties. Seller hereby covenants,
represents and warrants the following to Purchaser, which representations and
warranties shall be true and correct as of the date hereof and as of the
Closing:
(a) Legal Existence. Each Seller is a limited partnership duly organized
and validly existing under the laws of the State of Florida.
(b) Authority. Except for the approval described in Section 5.7 herein
which is a condition to Closing, the execution of this Contract and the
consummation of all transactions contemplated hereunder: (i) are within the
powers of Seller; (ii) have been duly authorized by appropriate action; and
(iii) will not conflict with, result in any breach of any of the provisions of,
or constitute a default (or an event which upon the giving of any required
notice or lapse of time would constitute a default) under Seller's
organizational documents or the provisions of any agreement, court or
administrative order, consent decree, or other instrument to which Seller is a
party.
(c) Enforceability. Except for the approvals described in Sections 5.6 and
5.7 which is a condition to Closing, all consents, authorizations and approvals
which may be required in order for Seller to enter into this Contract or
consummate the transactions contemplated hereby have been obtained. The person
executing this Contract on behalf of Seller has been duly authorized and
empowered to bind Seller to this Contract. This Contract has been duly executed
and delivered by Seller, and is the legal, valid and binding obligation of
Seller, enforceable against Seller in accordance with its terms, except as
enforcement thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the rights of creditors
generally and by equitable principles (whether or not such enforceability is
considered in a proceeding at law or in equity).
(d) Third Party Approval. No approval, consent, order, or authorization of
or designation, registration, or declaration with, any governmental authority is
required in connection with the valid execution and delivery of and, subject to
the requirements of Section 5.6 herein, compliance with this Contract by Seller.
(e) Non-Foreign Person. Seller is not a foreign person within the meaning
of Section 1445 of the Internal Revenue Code of 1986, as amended.
(f) Litigation. There is no action, suit or proceeding pending or, to the
knowledge of the Seller threatened against or affecting the Seller, or to which
Seller is a party, in any court, before any arbitrator or before or by any
governmental body which: (i) in any manner raises any question affecting the
validity or enforceability of this Contract or any other agreement or instrument
to which Seller is a party or by which it is bound and that is or is to be used
in connection with, or is contemplated by, this Contract; or (ii) to Seller's
knowledge could materially and adversely affect the Subject Properties, any part
thereof or any interest therein or the use, operation, condition or occupancy
thereof.
(g) Leases.
1. Lease Schedules. The schedule attached hereto as Schedule
5A.2(g)(1) (the "Rent Roll") is true, correct and complete in all material
respects with respect to all matters shown thereon, including, without
limitation: (i) the leases (including without limitation, all space leases,
storage space leases, antenna leases or licenses, and parking space
agreements), licenses, tenancies and other occupancy agreements now in
effect at the Subject Properties (each a "Lease" and collectively, the
"Leases"); (ii) the identities of the tenants or current occupants under
the Leases (the "Tenants"); (iii) any delinquencies under the Leases; (iv)
the space occupied by the Tenants (including the suite number); (v) the
commencement and expiration dates of the Leases; (vi) the current annual
and monthly rents payable thereunder; and (vii) the security deposits held
by the landlord under any of the Leases. At Closing, Seller shall provide
Purchaser with a true, correct and complete copy of an updated Rent Roll as
delivered to Seller by Manager certified by Seller dated not earlier than
five (5) days prior to Closing.
2. Delivery of Leases. True and complete copies of all Leases and all
amendments, guarantees and other documents relating thereto shall be made
available to Purchaser in accordance with Section 5.1 hereof.
3. Occupancy/Subleases. The Leases are in full force and effect. All
Tenants set forth on the Rent Roll have accepted occupancy of their
respective premises and are paying rent in the amount set forth on the Rent
Roll, with the exception of Howe, Solomon, Hall Financial which occupies
Suite 4200 which is delinquent in their rent. To Seller's knowledge and
except as disclosed on Schedule 5A.2(g)(3) (the "Subleases"), there are no
subleases in effect at the Subject Properties.
4. No Tenant Notices. Except as set forth on the Rent Roll attached
hereto, neither Seller nor Manager has: (i) received any written notice
from any Tenant that the landlord is in default under the terms of its
Lease; or (ii) received any written notification from any Tenant that it
disputes the computation of the rents payable pursuant to its Lease.
5. No Prepaid Rent. No Tenant has paid any rent for more than one (1)
month in advance, except as may otherwise be set forth
on the Rent Roll.
6. Tenant Default. Except as set forth on the Rent Roll attached
hereto, no Tenant is in monetary default, and to Seller's knowledge no
Tenant is in non-monetary default under the Leases with the exception of
Howe, Solomon, Hall Financial which occupies Suite 4200.
7. Landlord Default. Seller is not in default in its obligations as
landlord under any of the Leases and to Seller's knowledge no offset or
abatement is presently available to, or has been asserted in writing by,
any Tenant under any Lease, including, without limitation, those relating
to the calculation of any additional rentals payable by Tenants with
respect to the costs of operating the Improvements and allocation of taxes,
insurance, and leasehold payments made under the Ground Leases and other
matters paid by Tenants, with the possible exception of an overpayment by
Nationsbank of operating expenses in the amount of $6,908.
8. Tenant Improvements/Pre-Closing Leasing Commissions. Except as
provided for by Section 8.4 herein, all tenant improvement work to be
performed by or on behalf of the landlord under any of the Leases as set
forth on Schedule 5.1(d) (or prospective leases set forth on Schedule
5.1(d)) has been or will be performed and fully paid for by Closing or such
amounts shall be adjusted for as provided by Section 9.6 of this Contract,
and all leasing commissions with respect to the Leases in effect as of
Closing (or prospective leases set forth on Schedule 5.1(d)) have been or
will be satisfied on or before Closing or such amounts shall be adjusted
for as provided by Section 9.6 of this Contract.
9. Post-Closing Leasing Agreements. Except as disclosed on Schedule
5A.2(g)(9), there have been no agreements with brokers or other parties
entered into during the period of Seller's ownership of the Subject
Properties providing for the payment from and after Closing by Seller or
Seller's successor-in-interest of any leasing commissions, fees or other
compensation for or with respect to procuring tenants of the Subject
Properties or otherwise in connection with the Leases or any renewal or
expansion thereof.
10. Concessions. Except as set forth on Schedules 5A.2(g)(1) or 5.1(d)
attached, no Tenant is entitled to any rent concession, rent-free
occupancy, tenant improvement allowance, space plan allowance, or reduction
or abatement of rent or other monetary concession or inducement that has
not yet been satisfied in connection with such Tenant's occupancy pursuant
to its Lease.
11. TI Contracts. Schedule 5.1(d) is a true, correct and complete list
of all TI Contracts.
(h) Miscellaneous Contracts. The schedule attached as Schedule 5.1(e) is a
true, correct and complete list, as of the Effective Date, of all of the
Miscellaneous Contracts. The Miscellaneous Contracts are in full force and
effect. True, correct and complete copies of the Miscellaneous Contracts will be
made available to Purchaser in accordance with Section 5.1 hereof. The
Miscellaneous Contracts are free from any default by Seller and, to Seller's
knowledge free from any default by any other party thereto. There are no oral
contracts or agreements affecting the Improvements which would be binding upon
Purchaser after the Closing.
(i) Insurance. All premiums due on all insurance policies maintained by
Seller with respect to the Subject Properties have been paid by Seller and
Seller will maintain such insurance policies from the Effective Date through the
Closing or earlier termination of this Contract.
(j) Compliance With Laws. Neither Seller nor Manager has received any
written notice that the Subject Properties are not in full compliance with, and
to Seller's knowledge, Seller and the Subject Properties are in full compliance
with, all existing laws, rules, regulations, ordinances and orders of all
applicable federal, state, city and other governmental and quasi- governmental
authorities in effect as of the Effective Date with respect to the Subject
Properties (collectively, "Laws"), including, without limitation: (i) the
Americans with Disabilities Act, 42 U.S.C. Section 12102, et seq., together with
all rules, regulations and official interpretations promulgated pursuant
thereto; and (ii) all Laws with respect to zoning, building, fire and health
codes and sanitation.
(k) Employees. There are no employees of Seller employed in connection with
the use, management, maintenance or operation of the Property whose employment
will continue after the Closing Date. There is no bargaining unit or union
contract relating to any employees of Seller or the Subject Properties.
(l) Condemnation; Special Assessments. Except for (i) liens and assessments
pursuant to Chapter 84-10 of the Metropolitan Dade County Code, State of Florida
(pertaining to water and sewer charges), (ii) Resolution No. R-895-97 as shown
as item 23 of the Title Commitment (FM782508) (pertaining to an assessment for
the downtown component of the Metro Rail System in Miami), and (iii) the City of
Miami Fire/Rescue annual assessment, there is no pending or to Seller's
knowledge contemplated condemnation, eminent domain or similar proceeding or
special assessment which would affect the Subject Properties or any part thereof
in any way whatsoever.
(m) Licenses and Permits. Attached hereto as Schedule 5A.2(m) are true,
correct and complete copies of the licenses and permits ("Licenses"), as amended
and in effect which to Seller's knowledge are necessary for the use and
operation of the Subject Properties, with the exception of certificates of
occupancy for the individual Tenant spaces. To Seller's knowledge each of the
Licenses is in full force and effect and in good standing, and neither Seller
nor Manager has received written notice of any intention on the part of the
issuing authority to cancel, suspend or modify any of the Licenses or to take
any action or institute any proceedings to effect such a cancellation,
suspension or modification.
(n) Ground Leases. True, correct and complete copies of the Ground Leases
will be made available to Purchaser in accordance with Section 5.1 hereof. The
Ground Leases are free from any default by Seller and, to Seller's knowledge
free from default by any other party.
(o) Parking Rights Agreements. True, correct and complete copies of the
Parking Rights Agreements will be made available to Purchaser in accordance with
Section 5.1 hereof. The Parking Rights Agreements are free from any default by
Seller and, to Seller's knowledge free from default by any other party.
(p) Lighting Rights Agreement. True, correct and complete copies of the
Lighting Rights Agreement will be made available to Purchaser in accordance with
Section 5.1 hereof. The Lighting Rights Agreement are free from any default by
Seller and, to Seller's knowledge free from default by any other party.
(q) No Encumbrance. Other than the Ground Leases, the Leases, the
Subleases, the Miscellaneous Contracts, the Parking Rights Agreements, the
Lighting Rights Agreements, this Contract and the Permitted Exceptions, there
are no agreements or encumbrances which will be binding on Purchaser after the
Closing and which grant parties the right to possession of any portion of the
Subject Properties, and no parties are in possession of any portion of the
Subject Properties except parties claiming under such agreements.
(r) No Pending Sale Contracts. Except for this Contract, Seller has not
entered into any other currently effective agreements for the sale of the
Subject Properties, nor are there any currently existing rights of refusal or
options to acquire title to the Subject Properties in favor of any person or
entity except Purchaser.
(s) Environmental. Except as may be disclosed in the Environmental Reports:
(1) Seller has not generated, managed, treated or kept any Hazardous
Materials on the Subject Properties in violation of Environmental Laws or
in quantities requiring remediation under Environmental Laws;
(2) There has not been a Release by Seller, nor, to Seller's
knowledge, by any third party in violation of Environmental Laws of
Hazardous Materials into, onto, or out of the Subject Properties; and
(3) To Seller's knowledge, no underground Hazardous Materials storage
tanks currently exist on the Land.
The terms "Hazardous Material", "Environmental Laws" and "Release"
shall have the meaning set forth hereinbelow.
"Hazardous Material" means (a) any petroleum or petroleum products,
radioactive materials, asbestos in any form and polychlorinated
biphenyls ("PCBs") other than levels or forms of such substances as
are or may be naturally occurring on the Land; and (b) any waste,
chemical, material or substance defined as or included in the
definition of "hazardous substances", "hazardous waste", "hazardous
materials", "extremely hazardous substances", "toxic substances",
"toxic pollutants", "contaminants", or "pollutants" or words of
similar import, under any applicable Environmental Laws as those laws
exist on the Effective date; provided, however, Hazardous Materials do
not include any product, waste chemical, material or substance that
is, used in connection with (x) the ordinary course of Seller's
business at, use of and maintenance (including landscaping) activities
on the Subject Properties, which are consistent with ordinary business
at, use and maintenance of a commercial office building and are in
compliance with Environmental Laws in all material respects, and (y)
personal ordinary consumer products of Seller, which have been kept
and used in compliance with Environmental Laws in all material
respects.
"Environmental Law" means any federal, state or local statute, law,
rule, regulation, ordinance or code in effect and applicable to the
Subject Properties on the Effective Date, and any judicial or
administrative order, consent decree, judgment or directive in
effective and applicable to the Subject Properties on the Effective
Date, relating to the protection of environment or natural resources,
or Hazardous Materials, including without limitation, the Federal
Comprehensive Environmental Response, Compensation and Liability Act
of 1980, 42 U.S.C. ss.ss. 9501 et. seq., ("CERCLA") the Superfund
Amendments and Reauthorization Act, 42 U.S.C. ss.ss. 9601 et. seq.,
the Federal Toxic Substance Control Act, 15 U.S.C. ss.ss. 2601 et.
seq., the Federal Resource Conversation and Recovery Act, 42 U.S.C.
ss.ss. 6901 et. seq., the Federal Hazardous Material Transportation
Act, 49 U.S.C ss.ss. 1801 et. seq., the Federal clean Air Act, 42
U.S.C. ss. 7401 et. seq., the Federal Water Pollution Control Act, 33
U.S.C. ss. 1251 et. seq., and the regulations promulgated pursuant
thereto.
"Release" means any release, spill, emission, leaking, pumping,
injection, deposit, disposal, discharge, dispersal, leaking, or
migration into the environment of Hazardous Materials.
Seller represents that the Environmental Reports are all the reports
pertaining to environmental matters within their possession, and that it
has delivered true, correct and complete copies of all such reports to
Purchaser.
(t) Personal Property. Seller owns, or will own as of the Closing, all of
the Personal Property free and clear of all liens and claims by third parties,
except those encumbrances, if any, which will be discharged on or before the
Closing.
(u) Mechanic's Liens. Except as disclosed in the Title Commitment, there
are no unpaid charges, costs or expenses for the Subject Properties which could
give rise to any mechanic's or materialmen's or other statutory lien against the
Subject Properties, except those charges, costs and expenses that are not past
due and will be paid by Seller in the ordinary course of Seller's business on or
before the Closing.
(v) No Right of Possession. Other than the Ground Leases, Parking Rights
Agreements, Lighting Rights Agreements, Leases, Subleases, and the Miscellaneous
Contracts, this Contract, and the Permitted Exceptions there are no agreements
or encumbrances which will be binding on Purchaser after the Closing and which
grant parties the right to possession of any portion of the Subject Properties,
and no parties are in possession of any portion of the Subject Properties except
parties claiming under such agreements.
As used in this Contract, the words "to Seller's knowledge" or words of
similar import shall be deemed to mean, and shall be limited to, the actual (as
distinguished from implied, imputed or constructive) knowledge of Peter
Braverman, Carolyn Tiffany and Mark Smith without such individuals having any
obligation to make any independent inquiry or investigation whatsoever. Nothing
in this Contract shall be deemed to create or impose any personal liability of
any kind whatsoever on the within named individuals.
The representations and warranties of Seller contained in this Contract
will survive the Closing for a period of one year and six months after the
Closing except with respect to breaches alleged or claims made in writing by
Purchaser as provided in the next sentence, as to which the representations and
warranties shall survive until such claims are resolved (the "Claims Period");
and any claim based upon any alleged breach thereof must be alleged (in writing)
within such one year and six months period. Failure to give written notice on
any alleged breach or claim within the time period specified herein shall
constitute a waiver of any such claim. In addition, and notwithstanding any
other provision of this Contract, if Purchaser has actual knowledge of any
misrepresentation or breach of Seller on or prior to Closing, and nevertheless
proceeds to close, then Purchaser shall be deemed to waive, and hereby waives,
any such misrepresentation or breach. Seller agrees not to distribute $1,500,000
of Closing proceeds to any of its partners during the Claims Period, and shall
otherwise hold such funds unencumbered, and will not pledge such amounts as
security for other obligations (the "Covenant not to Distribute"). Seller
represents and warrants to Purchaser that following the Closing Seller shall
have no obligations or liabilities whatsoever, except trade creditors in the
ordinary course of its business for which Seller has made or will make adequate
reserves for payment, and the obligations of Seller hereunder which shall
survive Closing and the obligations of Seller with respect to the Subject
Properties for periods prior to the Closing. The provisions of this paragraph
shall survive the Closing.
ARTICLE 6. Inspection and Audit
6.1 Inspection Period. Purchaser shall have until Closing to make all
audits, inspections or investigations desired by Purchaser, subject to Seller's
requirements as hereinafter set forth. Purchaser shall give Seller at least 24
hours prior notice of Purchaser's intention to enter the premises for the
purpose of conducting any inspections or tests and shall afford Seller or its
representatives the opportunity to be present. Purchaser and Purchaser's
accountants, lenders, attorneys or other representative(s) shall have the right,
during regular business hours and upon reasonable notice, to:
(a) interview the Manager regarding the management or operation of the
Subject Properties and to inspect the Leases and books, records and files of the
Subject Properties that are in the Manager's possession or control and interview
the Major Tenants provided such interviews are arranged through Manager and
initial introductions are conducted by Manager;
(b) inspect the books, records and files relating to the condition or
operation of the Subject Properties that are in the possession or control of
Seller;
(c) subject to the rights of the Tenants, at Purchaser's sole risk and
expense, inspect the Real Property and Improvements and make such tests, surveys
and inspections as Purchaser deems necessary, including, without limitation,
soil tests, topographical surveys, structural and foundation surveys, concrete
tests, roof inspections, equipment inspections and environmental inspections.
Purchaser shall exercise (and cause its agents and employees to exercise) due
care and ordinary prudence in performing such surveys, inspections and tests and
shall not exercise such right in a manner that unreasonably interferes with the
operation of the Subject Properties or disrupts any Tenant. Seller shall have
the right to disapprove of Purchaser's agents and/or methods of the proposed
tests and inspections on the grounds that such proposed tests or inspections are
overly invasive and/or intrusive (e.g. Phase II environmental investigations),
in which case, Purchaser may propose reasonable alternative agents or testing
methods or terminate this Contract as provided in Section 6.2 below. Purchaser,
at its own cost and expense, promptly shall repair any damage to the Subject
Properties resulting from such surveys, tests or inspections to Seller's
reasonable satisfaction. Purchaser shall indemnify, defend, save and hold
harmless Seller from and against any and all claims, liens (including, without
limitation, mechanic's and materialman's liens), actions, suits, proceedings,
costs, expenses, damages or other liabilities, including, without limitation,
attorneys' fees and court costs, arising out of Purchaser's inspection rights
hereunder; provided, however, Purchaser shall not be obligated to indemnify
Seller for any claim, loss or cause of action caused by Seller's or its agent's
negligence or willful misconduct or any physical condition existing on the
Property prior to Purchaser's entry regardless of whether the same is discovered
by Purchaser or its agents. Prior to Closing, Seller, Purchaser and their
respective contractors and representatives shall keep confidential any and all
information, documents and reports obtained or prepared by them relating to the
Subject Properties; provided, however, that the foregoing shall not prohibit
disclosure where required by applicable law or court order or as required to
comply with applicable rules of any securities exchange. At Seller's request,
Purchaser shall furnish to Seller true and correct copies of all final third
party environmental studies, tests and surveys undertaken and completed in
connection with such inspections; provided, however, the same shall be delivered
to Seller without any representation or warranty by Purchaser as to the accuracy
or completeness thereof; and
(d) prior to entering the Real Property and Improvements, Purchaser shall
deliver to Seller a certificate of insurance, in form reasonably acceptable to
Seller, to evidence commercial general liability coverage (bodily injury and
property damage) in the amount of $1,000,000.00 combined single limit, which
policy or policies shall name Seller as an additional insured.
The indemnity and confidentiality provisions of this Section 6.1 shall
survive the Closing or the termination of this Contract.
6.2 Condition of Subject Properties. In the event that: (i) Purchaser,
during the period commencing on the Effective Date and ending on December 31,
1998 (the "Inspection Period"), disapproves of the condition of the Subject
Properties or the Submission Items, or (ii) in the event that the Minimum
Estoppel Requirement is not satisfied and/or the Ground Lease and Parking Rights
Agreement Estoppels and Consents are not obtained by February 16, 1999, or (iii)
an executed City Lease Amendment is not obtained by the date which is ten (10)
days prior to Closing, Purchaser, in its sole and absolute discretion, may
terminate this Contract by delivering written notice to Seller terminating this
Contract ("Notice of Termination") within the time periods provided in the next
sentence. The Notice of Termination must be delivered to Seller with respect to
Purchaser's disapproval under (i) above on or prior to the expiration of the
Inspection Period, and with respect to the failure to receive the items called
for under (ii) above, on or prior to February 18, 1999, and with respect to the
failure to receive the item called for under (iii) above three (3) business days
before Closing. In the event Purchaser so terminates this Agreement, Purchaser
shall be entitled to a return of the Earnest Money, and no party hereto shall
have any further obligations hereunder except Purchaser's liabilities under
Articles 6 and 10 hereof and Seller's liability under Article 10 hereof. In the
event that Purchaser fails to give the Notice of Termination within the time
periods prescribed above, Purchaser shall be deemed to have waived its rights to
terminate this Contract under this Section 6.2.
6.3 Underground Storage Tank (UST) Inspection Period. Purchaser shall have
until January 15, 1999 to investigate the status and condition of the UST which
is identified in the Environmental Reports. In the event Purchaser determines
that it may incur costs pertaining to the UST not exceeding $100,000 in its
reasonable judgment, then Seller shall be obligated to pay such costs in an
amount of up to $100,000. Seller, at its option, shall either deposit an amount
up to $100,000 as agreed to by Seller and Purchaser in escrow pursuant to an
escrow agreement, the terms and conditions of which are mutually acceptable to
Seller and Purchaser, or provide a credit to Purchaser against the Purchase
Price in such amount. In the event it is determined that such costs shall equal
or exceed $100,000, then either (a) Seller may elect to fund such amounts as
provided above and the parties shall proceed to Closing pursuant to the terms
and conditions of this Contract, or (b) Seller may decline to fund such excess
costs, and thereafter, Purchaser may either elect to (i) assume the obligation
to pay such excess costs (provided Seller shall be obligated to credit Purchaser
$100,000 against the Purchase Price), and the parties shall proceed to Closing
pursuant to the terms and conditions of this Contract, or (ii) terminate this
Contract by providing written notice to Seller of its election to terminate by
January 20, 1999, and thereafter the Earnest Money together with all interest
earned thereon shall be returned to Purchaser by the Title Company, and no party
hereto shall have any further obligations hereunder except Purchaser's
liabilities under Articles 6 and 10 hereof and Seller's liability under Article
10 hereof. In the event that Purchaser fails to give the notice of termination
by January 20, 1999, Purchaser shall be deemed to have waived its rights to
terminate this Contract under this Section 6.3.
ARTICLE 7. Damage or Destruction Prior to the Closing
7.1 Damage or Destruction. Until Closing, the risk of loss or damage to the
Subject Properties by fire or other casualty is assumed by Seller, but without
any obligation on the part of Seller to repair or replace any such loss or
damage. Seller shall notify Purchaser of the occurrence of any such loss or
damage to the Real Property and Improvements ("Seller's Notice") within five (5)
days after such occurrence or by the day of Closing, whichever first occurs. If:
(i) the estimated cost of repair, replacement or restoration of such loss or
damage (as defined in Section 7.4 hereof) to the Real Property and Improvements
is equal to or in excess of One Million Dollars ($1,000,000) (the "Threshold
Amount"), or (ii) Tenants comprising in the aggregate five percent (5%) of the
square footage of the Improvements exercise their right to terminate their
leases in accordance with the terms of such Leases ("Tenant Termination Event")
then Purchaser may upon notice to Seller, terminate this Contract, in which
event this Contract shall be terminated and of no further force or effect and no
party hereto shall thereafter have any further rights against, or obligations or
liabilities to, any other by reason of this Contract except for Purchaser's
liability pursuant to Articles 6 and 10 and Seller's liability pursuant to
Article 10 hereof and any monies paid by Purchaser as Earnest Money and all
interest thereon shall be returned to Purchaser and all insurance proceeds shall
be paid to Seller.
7.2 Purchaser's Option. If Purchaser fails to terminate this Agreement
within fifteen (15) days following Purchaser's receipt of the estimate to be
provided under Section 7.4, then Purchaser shall complete the purchase in
accordance with this Contract without reduction of the Purchase Price; provided,
however: (x) Seller shall turn over to Purchaser at the Closing the net proceeds
actually collected by Seller under the provisions of any hazard insurance
policies to the extent that they are attributable to loss of or damage to the
Subject Properties, less any sums theretofore reasonably expended by Seller in
repairing or replacing such loss or damage or in collecting such proceeds, (y)
Seller shall assign its rights with respect to such casualty under any insurance
policies (excluding amounts for any rental loss occurring prior to closing), and
(z) Purchaser shall receive a credit against the Purchase Price for the
deductible under Seller's insurance policy. If Purchaser elects or is deemed to
have elected pursuant to the terms of this Contract to proceed to Closing
hereunder, the Seller shall not compromise, settle or adjust any claims to such
proceeds or awards without the Purchaser's prior written consent, not to be
unreasonably withheld, conditioned or delayed.
7.3 Purchaser's Option Less than Threshold Amount. If the estimated cost of
repair, replacement or restoration of such loss or damage to the Real Property
and Improvements is less than the Threshold Amount and a Tenant Termination
Event does not occur, Purchaser shall complete the purchase in accordance with
Section 7.2 above.
7.4 Estimated Cost of Repair, Replacement and Restoration. The term
"estimated cost of repair, replacement and restoration" or "estimated value of
such portion of the Real Property and Improvements to be taken" shall mean a
firm bid for the actual cost of repair and restoration obtained by Seller from a
reputable contractor, reasonably acceptable to Purchaser, regularly doing
business in the locality where Subject Properties are located. Such estimate
shall be obtained by Seller within twenty (20) days of the date of delivery of
the Seller's Notice. In the event such estimate has not been obtained prior to
the originally scheduled Closing Date, the Closing shall be delayed until ten
(10) business days following the date on which such estimate is provided to
Purchaser, but in any event no later than April 30, 1999.
7.5 Condemnation. If a proceeding for any taking is pending or threatened
in writing prior to the Closing by any governmental or quasi-governmental body
or agency in the exercise of the power of eminent domain, then Purchaser, upon
notice to Seller, may terminate this Contract, in which event the Earnest Money
and all interest thereon will be returned to Purchaser and all condemnation
awards and proceeds shall be paid to Seller and no party hereto shall thereafter
have any further rights against, or obligations or liabilities to, any other by
reason of this Contract except for Purchaser's obligations and liabilities
pursuant to Articles 6 and 10 hereof and Seller's liability pursuant to Article
10 hereof. If this Contract is not so terminated and the Closing hereunder is
completed, all condemnation awards and proceeds shall be paid to Purchaser.
ARTICLE 8. Condition of Property
8.1 CONDITION OF PROPERTY. EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES
SPECIFICALLY SET FORTH IN THIS CONTRACT AND SELLER'S CLOSING DOCUMENTS, IT IS
EXPRESSLY UNDERSTOOD AND AGREED THAT PURCHASER SHALL ACCEPT THE CONVEYANCE OF
THE SUBJECT PROPERTIES IN THEIR PRESENT CONDITION, "AS-IS, WHERE-IS," SUBJECT TO
ALL PATENT AND LATENT DEFECTS, IF ANY, WITH NO REPRESENTATION OR WARRANTY BY
SELLER AS TO THEIR FITNESS, SUITABILITY, HABITABILITY, OR USABILITY, INCLUDING
BUT NOT LIMITED TO, (I) THE QUALITY OR CONDITION OF THE IMPROVEMENTS AND THE
REAL PROPERTY INCLUDING, WITHOUT LIMITATION, THE WATER, SOIL AND GEOLOGY, (II)
THE MANNER OF OPERATING THE SUBJECT PROPERTIES AND THE EXPENSES RELATED THERETO,
(III) THE COMPLIANCE OF THE SUBJECT PROPERTIES WITH ANY LAWS, RULES, ORDINANCES
OR REGULATIONS OF ANY GOVERNMENTAL BODY, AND (IV) THE NATURE AND EXTENT OF ANY
SERVITUDES, RIGHTS-OF-WAY, LEASES, POSSESSION, LIENS, ENCUMBRANCES, LICENSES,
RESERVATIONS, CONDITIONS OR OTHERWISE. EXCEPT FOR THE REPRESENTATIONS AND
WARRANTIES SPECIFICALLY SET FORTH IN THIS CONTRACT AND SELLER'S CLOSING
DOCUMENTS, PURCHASER ACKNOWLEDGES THAT IT IS NOT RELYING UPON ANY
REPRESENTATION, WARRANTY, STATEMENT OR OTHER ASSERTION WITH RESPECT TO THE
SUBJECT PROPERTIES' CONDITION MADE BY SELLER AND ACCEPTS THE SUBJECT PROPERTIES
UNDER THE EXPRESS UNDERSTANDING THAT THERE ARE NO EXPRESS OR IMPLIED WARRANTIES
MADE BY SELLER WITH RESPECT TO THE CONDITION OR VALUE OF THE SUBJECT PROPERTIES.
PURCHASER DECLARES THAT IT IS EXPERIENCED IN THE OWNERSHIP AND OPERATION OF
PROPERTIES SIMILAR TO THE SUBJECT PROPERTIES AND THEREFORE ACKNOWLEDGES THAT IT
WILL RELY SOLELY ON ITS OWN INVESTIGATION AND EXAMINATION OF THE SUBJECT
PROPERTIES, WHICH IT IS QUALIFIED TO MAKE, AND NOT ON ANY INFORMATION PROVIDED
OR TO BE PROVIDED BY SELLER EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES
SPECIFICALLY SET FORTH IN THIS CONTRACT AND IN SELLER'S CLOSING DOCUMENTS.
EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES OF SELLER EXPRESSLY SET FORTH IN
THIS CONTRACT AND IN SELLER'S CLOSING DOCUMENTS, SELLER MAKES NO REPRESENTATION
AS TO ANY ENVIRONMENTAL MATTERS RELATING TO THE SUBJECT PROPERTIES INCLUDING,
WITHOUT LIMITATION, SOIL CONDITIONS, PURCHASER HAVING BEEN GIVEN THE INSPECTION
PERIOD TO SATISFY ITSELF THAT THERE ARE NO HAZARDOUS MATERIALS (AS DEFINED IN
SECTION 5A.2(s)) ON OR IN THE SUBJECT PROPERTIES THAT WOULD CAUSE EITHER STATE
OR FEDERAL AGENCIES TO ORDER A CLEANUP OF THE SUBJECT PROPERTIES UNDER ANY
ENVIRONMENTAL LAW (AS DEFINED IN SECTION 5A.2(s). THE PROVISIONS OF THIS SECTION
8.1 SHALL SURVIVE CLOSING.
8.2 Purchaser's Additional Waivers. Except for the covenants,
representations and warranties of Seller expressly set forth in this Contract
and Seller's Closing Documents, Purchaser agrees that Seller shall not be
responsible or liable to Purchaser for any construction defects, errors,
omissions, or on account of any other property conditions affecting the Subject
Properties as Purchaser is purchasing the Subject Properties AS IS, WHERE IS and
WITH ALL FAULTS.
8.3 Management of Subject Properties. Seller agrees that it will continue
to cause the Subject Properties to be managed and operated by Manager through
the Closing in a manner consistent with the manner currently being practiced,
including, without limitation, the payment and performance of all obligations
required to be paid or performed under the Ground Leases, Parking Rights
Agreements, Lighting Rights Agreements, Leases, Laws, the Miscellaneous
Contracts and TI Contracts (as defined herein) and Seller shall cause Manager to
maintain the physical condition of the Subject Properties in substantially their
current condition and in compliance with laws, reasonable ordinary wear and tear
and damage by Purchaser and its agents and by fire and casualty excepted;
provided, however, Seller shall not be obligated to expend in excess of $500,000
for any capital repair or improvement of the Subject Properties, provided the
foregoing limitation shall not apply to usual and customary maintenance. Seller
shall direct its managing agent to forward all correspondence under the Leases
originating after the Effective Date to Purchaser. Except for limited
representations and warranties specifically set forth in this Contract and
Seller's closing documents, Seller makes no representations and assumes no
responsibility with respect to continued occupancy of the Real Property and
Improvements or any part thereof by any Tenant. Prior to Closing, Seller shall
obtain the prior consent of Purchaser, which shall not be unreasonably withheld,
conditioned or delayed, before enforcing its rights under any Lease against any
Tenant. Except as set forth in Section 8.4 below, from and after the Effective
Date, Seller shall not terminate or modify any of the Leases or enter into any
new Leases without the prior written consent of Purchaser. Furthermore, Seller
shall not grant any consent to any assignment or sublease under any Lease
unless, in Seller's good faith judgment, it is obligated to grant such consent.
8.4 Modification or Renewals of Leases. Seller will advise Purchaser in
writing of any pending renewal or modification of an existing Lease or any
proposed new lease of space in the Improvements that is acceptable to Seller, in
its sole and absolute discretion, and prior to the execution thereof will
provide to Purchaser a copy of the new lease or renewal or modification
(collectively, the "Proposed Lease") and written specifications
("Specifications") of certain terms and conditions with respect thereto,
including, among other things, location of the leased premises, rental rate,
term, options or renewals (if any), tenant improvement costs and leasing
commissions and Costs (as defined below) anticipated to be incurred in
connection therewith. Without limiting the foregoing, it is understood and
agreed that the lease proposals identified on Schedule 8.4 which are currently
being negotiated or finalized by Seller shall each constitute a Proposed Lease
as to which Purchaser's approval is required as provided herein. Commencing upon
the Effective Date, Purchaser shall have the right, which right shall be
exercised within a period of five (5) business days after receipt of the
Proposed Lease and Specifications, within which to approve or disapprove in
writing such Proposed Lease for space in the Improvements. Notice to Seller of
such approval or disapproval must be received by Seller within such five (5)
business day period. If Purchaser so approves, then all costs identified in the
Proposed Lease or Specifications, together with the reasonable third party costs
of negotiating such lease, including reasonable attorneys fees, and any
architectural or engineering fees (collectively "Costs"), shall be the
responsibility of Purchaser and Purchaser shall reimburse Seller at Closing for
Costs paid by Seller in connection therewith. If Purchaser fails to approve or
disapprove within such five (5) business day period, Seller shall provide
Purchaser notice of such five (5) business day period expiration, and one (1)
day after such notice Purchaser shall be deemed to have approved such proposed
modification or renewal of the existing Lease or such proposed new Lease.
If within such five (5) business day period and one day period, Purchaser
disapproves of any Proposed Lease, Seller shall not enter into any of such
agreements unless this Contract is terminated. Notwithstanding the provisions of
this Section 8.4, any renewal, expansion or option granted to a Tenant under an
existing Lease shall not be subject to the provisions of this Section 8.4 and
Purchaser shall accept the Subject Properties subject to the express terms of
such Lease, as so renewed, expanded or optioned, and shall assume all duties,
obligations and liabilities under any and all agreements in relation to paying
any Costs in connection therewith including, without limitation, reimbursing
Seller at Closing for any Costs paid by Seller prior to Closing. Purchaser's
duties and obligations under this Section 8.4, including, without limitation,
its obligations to pay all Costs, shall survive the Closing. Notwithstanding the
foregoing, the provisions of the immediately preceding paragraph shall not
permit Seller to enter into any agreement amending or modifying the terms of any
existing Lease with respect to the exercise by any Tenant of any right or option
granted to such Tenant therein without the prior written consent of Purchaser as
provided in the first paragraph of this Section 8.4, including, by way of
example and not by way of limitation, entering into any agreement with a Tenant
establishing the market rate to be paid pursuant to a lease or increasing or
decreasing the amount of space to which a renewal option applies.
8.5 Personal Property. Seller shall not transfer nor remove any Personal
Property that is material to the operation or value of the Land and Improvements
subsequent to the Effective Date unless Seller replaces the same prior to the
Closing Date with personal property of equivalent or better utility and quality
to the items replaced. Seller shall notify Purchaser in writing prior to
effecting any replacement of Personal Property pursuant to the prior sentence.
8.6 Further Encumbrances. From and after the Effective Date, Seller shall
not further encumber the Subject Properties without the written consent of
Purchaser, and in all events Seller shall not place any further monetary liens
on the Subject Properties except those for taxes or assessments not yet due and
payable.
8.7 Copies of Documents. Seller shall promptly provide Purchaser with
copies of all monthly operating reports prepared or received by Seller
(including but not limited to leasing information) from the Effective Date to
the Closing Date.
8.8 Notices. Seller shall provide to Purchaser promptly following Seller's
receipt (i) any written notices by the landlord or the tenant under any of the
Ground leases, the Leases or by any party under any of the Miscellaneous
Contracts, Parking Rights Agreements or Lighting Rights Agreements delivered or
received by Seller from and after the Effective Date and (ii) any written
notices of alleged violations of applicable law with respect to the Subject
Properties received by Seller from and after the Effective Date.
8.9 Contracting Prior to Closing. From and after the Effective Date, Seller
shall not enter into any new Miscellaneous Contracts or terminate or amend
existing Miscellaneous Contracts without Purchaser's prior written approval;
provided, however, Seller shall at its expense cause Seller's leasing and
management agreement with Manager and any other Miscellaneous Contracts
identified by Purchaser to be terminated as provided in Section 5.1(e) above.
Seller shall comply in all material respects with its obligations under the
Miscellaneous Contracts.
8.10 Construction. From and after the Effective Date, Seller shall not
construct or permit to be constructed any improvements or capital items to or on
the Improvements, including tenant improvements, without the prior written
approval of Purchaser, which approval shall not be unreasonably withheld or
delayed, except tenant improvements which Tenants are entitled to make pursuant
to Leases. Notwithstanding the foregoing, Seller may freely make (without the
consent of Purchaser) any improvements for which Purchaser shall not be required
to pay (e.g., that are paid fully by Seller or which Purchaser agrees will be
paid by Tenants under Lease as operating expenses of the Subject Properties),
provided the same do not impair or decrease the value of the Subject Properties.
8.11 Ground Leases, Parking Rights Agreements and Lighting Rights
Agreement. From and after the Effective Date, Seller shall not terminate or
modify any of the Ground Leases, Parking Rights Agreements or Lighting Rights
Agreement. Seller shall perform all of Seller's obligations under the Ground
Leases, Parking Rights Agreements and Lighting Rights Agreement.
8.12 No Negotiations. From and after the Effective Date, neither Seller nor
its agents shall solicit, entertain, negotiate, accept, or consider any other
offers or make any proposals regarding the sale of the Subject Properties (or
any portion thereof or any interest therein) to any third party and shall cease
all activities to market the Subject Properties so long as this Contract remains
in force and effect. Seller hereby represents and warrants to Purchaser that
Seller has terminated all negotiations with third parties relating to the
Subject Properties or any portion thereof or any interest therein. Without
limiting the foregoing, in the event Seller or its agents receive an unsolicited
offer from any third party regarding the acquisition of the Subject Properties
or any interest therein during the pendency of this Contract, Seller shall
promptly notify Purchaser in writing of such fact and provide any letter of
intent or summary of the offer terms submitted by such third party. Purchaser
agrees to indemnify, defend and hold Seller and its affiliates and any of their
partners, shareholders, members, directors, officers, employees and agents
entirely harmless against and from any claim, demand, cause of action, judgment,
damage, loss, liability, cost or expense (including attorneys' fees and
expenses), which the Seller may suffer, sustain, incur or otherwise become
subject to (either directly or indirectly as a result of any affiliate of Seller
suffering, sustaining, incurring or otherwise becoming subject to same), as a
result of any breach of confidentiality which Seller is subject to due to the
disclosure requirements referred to above. Seller agrees not to execute any
confidentiality agreements with a third party during the pendency of this
Contract.
ARTICLE 9. Closing
9.1 Date of Closing. The Closing hereunder shall take place at the Subject
Properties at 9:00 a.m. or such other place and at such other time as the Seller
and Purchaser may agree. The Closing shall commence on March 3, 1999, with the
recording and delivery of the applicable closing documents and funding of the
Purchase Price to occur March 4, 1999, no later than 11:00 a.m. New York time.
9.2 Purchaser's Closing Conditions. The obligation of Purchaser to purchase
the Subject Properties from Seller, and to perform the obligations required to
be performed by Purchaser at the Closing, are subject to each of the following
conditions ("Purchaser's Conditions"):
(a) Seller shall have obtained Partner Consent and tendered at Closing all
of Seller's Closing Documents;
(b) Seller shall have performed and complied in all material respects with
its covenants and obligations under this Contract prior to or at Closing;
(c) All of Seller's representations and warranties under Section 5A.2 are
true and correct in all material respects as of Closing;
(d) The condition described in the last grammatical paragraph of Section
4.4 relating to the Title Company's issuance of an Owner's Title Policy in favor
of Purchaser shall have been satisfied;
(e) The Minimum Estoppel Requirement shall have been satisfied;
(f) Seller shall have obtained the estoppels required under Section 5.6
with respect to the Ground Lease and Parking Rights Lease;
(g) A fully executed City Lease Amendment shall have been obtained;
(h) Purchaser shall have received the Updated Survey;
(i) Seller shall have terminated that certain Health Club Operator's
Agreement with DAC-Miami, Inc., unless Purchaser shall have otherwise
renegotiated the terms of such agreement prior to Closing; and
(j) No material adverse change in the condition of the Subject Properties,
or the compliance of the Subject Properties with applicable laws, the violation
of which could materially and adversely affect the Subject Properties, has
occurred.
9.3 Seller's Closing Conditions. Seller's obligations to close on the
Closing Date are conditional and contingent on the following, unless waived in
writing by Seller:
(a) Purchaser shall have tendered the Purchase Price, subject to applicable
prorations;
(b) Purchaser shall have tendered at Closing all Closing Documents to which
Purchaser is a party;
(c) Purchaser shall have performed and complied in all material respects
with its obligations under this Agreement;
(d) Seller shall have obtained Partner Consent; and
(e) All of Purchaser's representations and warranties under Section 5A.1
are true and correct in all material respects as of Closing.
9.4 Delivery of Items At Closing By Seller. At the Closing, Seller shall
deliver or cause to be delivered to Purchaser and Purchaser shall accept each of
the following items ("Seller's Closing Documents"):
(a) an Assignment and Assumption of the Ground Leases, in the form attached
hereto as Exhibit "H" and made a part hereof duly executed and acknowledged by
Seller, conveying Seller's interest in the Ground Leases to Purchaser, subject
to the Permitted Exceptions;
(b) an Assignment and Assumption of the Parking Rights Agreements, in the
form attached hereto as Exhibit "I" and made a part hereof duly executed and
acknowledged by Seller, conveying Seller's interest in the Parking Rights
Agreements;
(c) a Quit-Claim Deed, in the form attached hereto as Exhibit "J" and made
a part hereof duly executed and acknowledged by Seller, conveying title in the
Improvements to Purchaser, subject to the Permitted Exceptions;
(d) a Bill of Sale in the form attached hereto as Exhibit "K" and made a
part hereof duly executed and acknowledged by Seller, conveying to Purchaser the
Personal Property and the Intangible Property, subject to the Permitted
Exceptions;
(e) an assignment in the form attached as Exhibit "L" and made a part
hereof, duly executed and acknowledged by Seller, assigning to Purchaser all of
Seller's interest in (i) the Leases and security deposits, (ii) the Lighting
Rights Agreements, (iii) those Miscellaneous Contracts Purchaser is assuming
pursuant to Section 5.1(e) hereof, (iv) the warranties, guaranties, and bonds
applicable to the Subject Properties, (v) the Costs, if any, Purchaser is
assuming pursuant to Section 8.4 hereof and (vi) the Awards;
(f) a Seller's Certificate confirming that the representations and
warranties of Seller set forth in Article 5.2A are true and correct in all
material respects as of the Closing Date;
(g) a letter in the form attached as Exhibit "M" and made a part hereof to
be addressed to each Tenant under the Leases advising such Tenant that the
Subject Properties have been sold to Purchaser, and that Purchaser has assumed
the obligation to refund such Tenant's security deposit in accordance with such
Lease, with the exact amount of the deposit specified for such Tenant and direct
such tenant to pay all rent as provided in said notice;
(h) executed originals of all Leases or occupancy agreements and security
deposits of Tenants (the security deposits may be transferred to Purchaser by
separate check issued from the Manager's account) relating to all or any part of
the Subject Properties;
(i) an assignment to Purchaser of all non-cash security deposits, if any,
pursuant to an instrument reasonably satisfactory to Purchaser;
(j) all keys to all locks on the Subject Properties in possession of Seller
or Manager;
(k) all leasing and property files, books and records for the Subject
Properties in the possession of Seller or Manager;
(l) copies of all Miscellaneous Contracts;
(m) a certification in the form attached as Exhibit "N" and made a part
hereof executed by Seller containing the following:
(i) the Seller's U.S. Taxpayer Identification Number;
(ii) the business address of Seller; and
(iii) a statement that Seller is not a foreign person within the
meaning of Sections 1445 and 7701 of the Internal Revenue Code ("IRC")
(i.e., Seller is not a nonresident alien, foreign corporation, foreign
partnership, foreign trust or foreign estate as those terms are defined in
the IRC and applicable Income Tax Regulations);
(n) a Seller's Affidavit of Title in form acceptable to the Title Company
executed by the Seller and all other documents required to satisfy the
requirements of Schedule B, Section 1 of the Title Commitment;
(o) an updated Rent Roll in substantially the same form as Schedule
5A.2(g)(1) attached hereto certified as of a date not earlier than five (5)
business days prior to the Closing Date certified as being true and correct by
Seller;
(p) deliver to Purchaser such evidence or documents as may be required by
the Purchaser or the Title Company evidencing the authority, status and capacity
of Seller and the authority of the person or persons who are executing the
various documents on behalf of Seller in connection with the sale of the Subject
Properties; and
(q) execute and deliver such other documents as Purchaser or Title Company
may reasonably request in order to effect the transactions contemplated
hereunder, including, without limitation, the execution of closing statements.
9.5 Delivery of Items at Closing By Purchaser. At the Closing, Purchaser
shall:
(a) deliver to Seller the Purchase Price less the Earnest Money and all
interest thereon (which shall be applied against the Purchase Price), subject to
adjustment for all credits, prorations and closing costs provided for in this
Contract;
(b) deliver to Seller such evidence or documents as may be required by the
Seller or the Title Company evidencing the authority, status and capacity of
Purchaser and the authority of the person or persons who are executing the
various documents on behalf of Purchaser in connection with the acquisition of
the Subject Properties;
(c) join Seller in the execution of the documents described in items
9.4(a), (b) and (e) above;
(d) join Seller in the execution of the document described in item 9.4(g)
above; and
(e) execute and deliver such other documents as Seller or Title Company may
reasonably request in order to effect the transactions contemplated hereunder,
including, without limitation, the execution of closing statements as may be
prepared by the Seller and/or Title Company.
9.6 Prorations. At the Closing, the following items shall be adjusted and
prorated between Seller and Purchaser on a per diem and accrual basis as of
12:01 A.M. on the day of Closing:
(a) Rents and other charges payable under the Leases, including
Reimbursable Expenses (as hereinafter defined). For purposes hereof, all rents
and other charges payable under the Leases for the calendar month in which the
Closing occurs shall be prorated on the basis of sums actually collected by
Seller prior to the Closing. From and after Closing, all rent collections shall
be first applied to current monthly charges, with the balance, if any, to be
applied to arrears for months following Closing and then for arrears in months
prior to Closing. After the Closing, Purchaser shall have a duty and obligation
to Seller to remit such unpaid rents and other charges to Seller if, as and when
collected by Purchaser, collected within one (1) year following the date of
Closing; provided, however, Purchaser shall have no obligation to collect any
such unpaid amounts. Purchaser shall use commercially reasonable efforts to
collect any such unpaid rents or other charges in arrears except that in no
event shall Purchaser be obligated to institute any actions or proceedings or
seek the eviction of any tenant in order to collect any such delinquencies.
After Closing, in no event shall Seller (i) declare a default under any Lease or
seek to evict any tenant or to recover possession of its space, (ii) initiate
any involuntary bankruptcy or similar proceeding against any tenant or (iii)
take any action which would entitle a tenant to terminate its Lease or pursue
any offset or other remedy against Purchaser. Notwithstanding the foregoing,
Purchaser shall be entitled to all rents payable by Eurest Dining Services
(f/k/a Daka) for calendar year 1999 without adjustment between Seller and
Purchaser. The provisions of this Section 9.6(a) shall survive the Closing.
(b) Payments under the Ground Leases, Parking Rights Agreements, Lighting
Rights Agreements and Miscellaneous Contracts on the basis of the actual
payments owed or prepaid thereunder. If the actual payments owed under the such
contracts are not known at the Closing, the proration of such payments shall be
made on the basis of the best evidence then available, which proration shall be
subject to reproration when the actual amount is determined.
(c) Real estate, ad valorem and personal property taxes, sewer rents and
charges, and other state, county and municipal taxes, charges and assessments
(special or otherwise) which may be paid in installments shall be prorated on
the basis of the fiscal year for which the same are levied, imposed or assessed.
Seller shall pay regular installments of all such taxes that are due for periods
prior to the Closing. All assessments which can be paid in installments shall be
paid in the maximum number of installments permitted by law. All installments of
special assessments or portions due for periods on or after the Closing shall be
assumed and paid by Purchaser.
(d) Charges for water, electricity, gas and other utilities. Seller shall
furnish a current reading of each meter at the Closing, which readings shall
have been made either as of midnight on the day prior to the Closing or as close
to the Closing as reasonably possible, and in any event Seller shall be
responsible for paying charges therefor to midnight on the day prior to the
Closing or submitting proof that such charges were previously paid. In the event
meter readings current as of midnight on the day prior to the Closing are not
available at Closing, then Seller shall pay at Closing the charges to the date
of the most recent reading or submit proof that such charges were previously
paid, and the parties further agree to notify the utility companies to read the
meters as soon as possible after Closing and adjust and prorate such utility
charges when the actual readings are available.
(e) At the Closing, Seller and Purchaser shall mutually, and in good faith,
estimate the amount, if any, by which tenants under the Leases have actually
over paid or under paid Reimbursable Expenses (as herein defined) for periods
prior to the Closing. As used herein, the term "Reimbursable Expenses" shall
mean payments required to be paid by tenants under Leases for a portion of ad
valorem taxes, insurance, common area maintenance and/or other operating
expenses of the Subject Properties, but such term shall not include delinquent
and uncollected payments therefor. The amount of any estimated underpayment of
Reimbursable Expenses for the period prior to Closing shall be paid by Purchaser
to Seller as and when such underbilled amounts are collected from tenants. The
amount of any estimated overpayment of Reimbursable Expenses for the period
prior to Closing shall be paid by Seller to Purchaser at Closing, including
$6,908 attributable to the NationsBank Lease. The parties will adjust the
closing prorations for Reimbursable Expenses as and when the actual amounts are
known.
(f) The TI Contracts set forth on Schedule 5.1(d) and the Costs provided
for by Section 8.4 herein. To the extent Seller has not performed and fully paid
for all tenant improvement work to be performed by and on behalf of landlord
under the Leases (except as provided for by Section 8.4 herein): (i) such amount
shall be itemized on a schedule reasonably satisfactory to Purchaser to be
delivered by Seller to Purchaser at Closing; (ii) Purchaser shall assume such
obligations pursuant to the assignment in the form attached hereto as Exhibit
"L"; and (iii) Purchaser shall receive a credit against the Purchase Price in
the amount set forth on such schedule.
(g) Notwithstanding anything herein to the contrary, if Purchaser or Seller
receives any amounts as a result of a tax contest filed prior to Closing, such
refund shall be applied as follows: first, to reimburse the Purchaser or Seller,
as applicable, for all cost incurred in connection with the appeal to the extent
not passed through to Tenants; second, with respect to refunds payable to past,
present or future tenants of the Subject Properties pursuant to Leases to such
tenants in accordance with the terms of such Leases; and third, to Seller to the
extent such contest covers the period prior to the date of the Closing, and to
Purchaser to the extent such contest covers the period as of the date of the
Closing and thereafter. If and to the extent any contest covers the period after
the date of the Closing, Purchaser shall have a right to participate in such
contest.
(h) All other items of revenue and expense which are customarily prorated
between purchasers and sellers of real property in Miami, Florida shall be
prorated between Purchaser and Seller. Any revenue or expense amount which
cannot be ascertained with certainty as of Closing shall be prorated on the
basis of the parties' reasonable estimates of such amount, and shall be the
subject of a final proration as soon thereafter as the precise amounts can be
ascertained. Purchaser or Seller shall promptly notify the other party when it
becomes aware that any such estimated amount has been ascertained. Purchaser
shall submit to Seller a final proration statement when such estimated amounts
become known. Payments in connection with the final proration statement, shall
be due within thirty (30) days after said final proration statement has been
submitted to Seller.
Notwithstanding anything set forth in this Section 9.6, all prorations
shall be deemed final one (1) year after Closing.
9.7 Errors and Omissions. Any errors and omissions in computing
apportionments at Closing shall be promptly corrected, which obligation survives
the Closing.
9.8 Purchaser's Costs. At Closing, Purchaser shall pay for the following:
(i) one half of the escrow fees charged by the Title Company;
(ii) costs of recording all documents delivered by Seller to Purchaser or
by Purchaser to Seller at the Closing;
(iii) mortgage, conveyance and tax certificate fees charged by the Title
Company, if any; and
(iv) the attorney's fees of Purchaser's counsel in connection with or
relating to the transactions contemplated by this Contract.
9.9 Seller's Costs. At Closing, Seller shall pay for the following:
(i) all deed stamps, intangible taxes and other transfer taxes imposed on
the transfer of the Subject Properties;
(ii) one half of the escrow fees charged by the Title Company;
(iii) the charges for the owner's title policy (including all endorsements)
to be issued to Purchaser;
(iv) the update to the survey; and
(v) the attorney's fees of Seller's counsel in connection with or relating
to the transactions contemplated by this Contract.
9.10 Possession. Possession of the Subject Properties shall be delivered to
Purchaser on the Closing Date, subject only to the Permitted Exceptions, and the
Tenants in possession under the Leases.
ARTICLE 10. Real Estate Commission
10.1 Commissions. Seller and Purchaser hereby covenant and agree one with
the other that no real estate commissions, finders' fees or brokers' fees have
been or will be incurred in connection with this Contract or the transactions
contemplated hereby, except as specified in this Section 10.1. A commission
("Commission") shall be payable by Seller to Insignia/ESG, Inc. and Aztec Group,
Inc. (collectively, the "Broker") at Closing pursuant to a separate agreement.
Seller hereby agrees to indemnify and hold Purchaser harmless, from and against
any claims, causes of action or liabilities, including, without limitation,
reasonable attorneys' fees and court costs, that may be incurred with respect to
any claim for other real estate commissions, brokers' fees or finders' fees
relative to this Contract by parties claiming by, through or under Seller,
including, without limitation, any claims by Broker. Purchaser hereby agrees to
indemnify and hold Seller harmless, from and against any claims, causes of
action or liabilities, including, without limitation, reasonable attorneys' fees
and court costs, that may be incurred with respect to any claim for other real
estate commissions, brokers' fees or finders' fees relative to this Contract, by
parties claiming by, through or under Purchaser, excluding any claim by Broker.
The provisions of Section 10.1 shall survive the Closing or termination of this
Contract.
ARTICLE 11. Remedies on Default
11.1 Termination Of Contract By Purchaser. If this Contract is terminated
by Purchaser in accordance with any one or more Sections hereof that entitle
Purchaser to terminate this Contract, then the Earnest Money and any interest
thereon shall be returned to Purchaser by the Title Company as provided for by
Section 12.20 of this Contract, and no party hereto shall have any further
obligations to any other hereunder, except for Purchaser's obligations and
liabilities under Articles 6 and 10 and Seller's obligations under Article 10
hereof.
11.2 Purchaser's Default. If the Purchaser defaults in the performance of
its obligations hereunder, and such default remains uncured for five (5)
business days after notice of such breach is delivered by Seller to Purchaser,
then the Earnest Money and any interest thereon shall be paid to the Seller by
the Title Company as liquidated damages as Seller's sole remedy. Such amount is
agreed upon by and between Seller and Purchaser as liquidated damages due to the
difficulty and inconvenience of ascertaining and measuring actual damages and
the uncertainty thereof; and no other damages, rights or remedies at law or in
equity (except as provided in Articles 6 and 10 hereof) shall in any case be
collectible, enforceable or available to Seller, but Seller shall accept said
cash payments as Seller's total damages and relief.
11.3 Seller's Default. In the event that Seller defaults in the performance
of its obligations hereunder and such default remains uncured for a period of
five (5) days after notice of such default is delivered by Purchaser to Seller,
at Purchaser's election, Purchaser shall (a) be entitled to terminate this
Contract whereupon the Title Company shall return the Earnest Money and any
interest thereon to Purchaser and Purchaser shall be entitled to reimbursement
from Seller of its actual out of pocket expenses of Purchaser and its counsel
and third parties conducting due diligence (i.e. title, survey, engineer and
environmental reports, based upon paid receipts tendered by Purchaser to Seller)
not to exceed Two Hundred Fifty Thousand Dollars ($250,000.00); or (b) be
entitled to sue Seller for specific performance of this Contract provided,
however, Seller shall not be required to expend in excess of Two Hundred Fifty
Thousand Dollars ($250,000.00) to correct any matter Seller did not cause by its
acts or omissions (excluding (i) any capital expenditures which shall be subject
to the $500,000 limitation set forth in Section 8.3 herein, and (ii) any amounts
to cure and pay off the Liens as required by Section 4.4 herein); or (c) only if
Purchaser shall not be entitled to specific performance by reason of Seller's
conveying or encumbering all or any part of the Subject Properties subsequent to
the date of this Contract, terminate this Contract by giving written notice of
termination to Seller, receive a full and immediate refund of the Earnest Money
and all interest earned thereon, and seek damages for breach of this Contract by
Seller.
11.4 Failure of Conditions. If neither party shall be in default hereunder
and any of the conditions to Seller's obligations under this Contract or any of
the conditions to Purchaser's obligations under this Contract shall fail to
occur, then Purchaser or Seller, as the case may be, may, as its sole and
exclusive remedy, terminate this Contract by written notice to the other, in
which event the Earnest Money, together with any interest earned thereon, shall
be promptly returned to Purchaser and neither party shall have any further
rights or obligations hereunder (except for Purchaser's liability pursuant to
Articles 6 and 10 hereof and Seller's liability pursuant to Article 10 hereof).
ARTICLE 12. Miscellaneous
12.1 Notices. All notices, demands, consents, or other communications of
any type (collectively "Notices") given by Seller to Purchaser or by Purchaser
to Seller whether required by this Contract or in any way related to any of the
transactions contracted for herein shall be void and of no effect unless given
in accordance with the provisions of this Section 12.1. All notices shall be in
writing, signed by the party giving the same or by its attorneys, and shall be
delivered to the person to whom the notice is directed, either in person, by
United States Mail, as a registered or certified item, return receipt requested
or by Federal Express or other recognized overnight delivery service, or by
facsimile (provided, however, that in the event notice is given by facsimile, a
conforming copy of such notice must be delivered by one of the other methods
described above) as follows:
Hines Interests Limited Partnership
70 West Madison, Suite 440
Chicago, Illinois 60602
Attention: C. Kevin Shannahan
Phone: (312) 419-4900
Fax: (312) 346-4180
with a copy to: Baker & Botts, L.L.P
One Shell Plaza
910 Louisiana
Houston, Texas 77002
Attention: Peter M. Oxman, Esquire
Phone: (713) 229-1234
Fax: (713) 229-1522
and: c/o Hines National Office Partners Limited Partnership
101 California Street, Suite 1000
San Francisco, California 94111
Attention: Daniel MacEachron
Phone: (415) 982-6200
Fax: (415) 398-1442
and addressed, if to the Seller, as follows:
c/o Winthrop Financial Associates
100 Jericho Quadrangle, Suite 214
Jericho, New York 11753
Attention: Peter Braverman
Phone:(516) 822-0022
Fax: (516) 433-2777
with a copy to: Winthrop Financial Associates
5 Cambridge Center, 9th Floor
Cambridge, Massachusetts 02142
Attention: Carolyn Tiffany
Phone: (617) 234-3000
Fax: (617) 868-1093
and: Post & Heymann, LLP
100 Jericho Quadrangle, Suite 214
Jericho, New York 11753
Attention: William W. Post, Esquire
Phone: (516) 681-3636
Fax: (516) 433-2777
Any party hereto may change the address or contact for notice specified above by
giving the other party ten (10) days advance written notice of such change of
address or contact. All Notices shall be deemed to have been given when
received. Notices shall be deemed to be timely delivered if such notice is
received by the intended recipient on or before 6:00 p.m. New York time on the
date of such notice.
12.2 Effective Date. This Contract may be executed in multiple counterparts
on the respective dates set forth below, each of which shall constitute an
original, but which together shall constitute but one Contract. Notwithstanding
the above and Article 3 hereof, this Contract shall be of no force and effect
until the full execution and delivery of the Contract by Purchaser and Seller
(the "Effective Date"); provided, however, Seller shall have the right to
declare this Contract null and void if Purchaser does not deposit the Earnest
Money with the Title Company within the time period prescribed by Article 3.
12.3 Assignment. This Contract may not be assigned by Purchaser.
Notwithstanding the foregoing, the Purchaser shall have the right, power and
authority to assign this Contract and all rights hereunder to an Affiliate of
Purchaser. The Purchaser shall be and remain liable and responsible for payment
and performance of all obligations hereunder or undertaken by the Purchaser to
be paid or performed pursuant to any permitted assignment. For purposes of this
Agreement, "Affiliate" means any other person controlling, controlled by or
under common control with Purchaser, and "Control" means the power to direct the
management and policies of such person, directly or indirectly, whether through
the ownership of voting securities or other beneficial interests, by contract or
otherwise, and the terms "controls", "controlling" and "controlled" have the
meanings correlative to the foregoing. This Contract may not be assigned by
Seller without Purchaser's prior written consent.
12.4 Laws. This Contract shall be construed and interpreted in accordance
with the laws of the State of Florida and the obligations of the parties hereto
are and shall be performable in the county wherein the Subject Properties are
located. Where required for proper interpretation, words in the singular shall
include the plural; the masculine gender shall include the neuter and feminine,
and vice versa.
12.5 Modification. This Contract may not be modified or amended, except by
an agreement in writing signed by Seller and Purchaser. Seller and Purchaser may
waive any of the conditions contained herein or any of the obligations of the
other hereunder, but any such waiver shall be effective only if in writing and
signed by the party waiving such conditions or obligations.
12.6 Authority. Each person executing this Contract warrants and represents
that he is fully authorized to do so.
12.7 Times And Dates. TIME IS OF THE ESSENCE IN THIS CONTRACT and all times
and dates shall be in accordance with New York, New York Time. Notwithstanding
the foregoing, either party shall have the right to adjourn the Closing for a
period not to exceed five (5) business days upon reasonable prior notice to the
other party due to causes which are outside the control of the parties
(financial inability excepted) and could not be avoided by the exercise of due
care.
12.8 Descriptive Headings. The descriptive headings of the several
Articles, Sections and paragraphs contained in this Contract are inserted for
convenience only and shall not control or affect the meaning or construction of
any of the provisions hereof.
12.9 Entire Contract. This Contract, including the Exhibits hereto,
constitutes the entire agreement among the parties, whether written or oral,
pertaining to the subject matter hereof and supersedes all prior and
contemporaneous agreements and understandings of the parties in connection
therewith. No representation, warranty, covenant, agreement or condition not
expressed in this Contract shall be binding upon the parties hereto or shall
affect or be effective to interpret, change or restrict the provisions of this
Contract unless the parties have complied with the terms of Section 12.5 hereof.
12.10 Construction. This Contract shall not be construed more strongly
against any party regardless of who was more responsible for its preparation.
12.11 Non-recordable. This Contract, a memorandum of this Contract, an
interest in ownership of the Subject Properties or any other document that would
constitute an exception to Seller's title shall not be recorded and the
provisions hereof shall not constitute a lien on the Subject Properties.
12.12 Third-Party Beneficiary. It is specifically understood and agreed
that no person or other entity shall be a third-party beneficiary hereunder, and
that none of the provisions of this Contract shall be for the benefit of or be
enforceable by anyone other than the parties hereto, and that only the parties
hereto shall have any rights hereunder.
12.13 Legal Relationship. Nothing herein shall be construed as to
constitute or establish any type of joint venture, partnership, or any other
type of legal relationship between the parties other than the vendor-vendee
relationship established hereby between Seller and Purchaser.
12.14 Indemnification.
(a) Seller agrees to indemnify, defend and hold Purchaser and its
affiliates and any of their partners, shareholders, members, directors,
officers, employees and agents entirely harmless against and from any claim,
demand, cause of action, judgment, damage, loss, liability, cost or expense
(including attorneys' fees and expenses), which the Purchaser may suffer,
sustain, incur or otherwise become subject to (either directly or indirectly as
a result of any affiliate of Purchaser suffering, sustaining, incurring or
otherwise becoming subject to same), as a result of, in whole or in part by any
and all obligations to, liabilities to or claims asserted by any third parties
pertaining to any injury to or the death of any person or damage to property of
third parties or any obligation of Seller not expressly assumed by Purchaser in
any way relating to or arising from the Subject Properties prior to Closing
(except to the extent caused by Purchaser or its agents).
(b) Purchaser agrees to indemnify, defend and hold Seller and its
affiliates and any of their partners, shareholders, directors, officers,
employees and agents entirely harmless against and from any claim, demand, cause
of action, judgment, damage, loss, liability, cost or expense (including
attorneys' fees and expenses), which the Seller may suffer, sustain, incur or
otherwise become subject to (either directly or indirectly as a result of any
affiliate of Seller's suffering, sustaining, incurring or otherwise becoming
subject to same), as a result of, in whole or in part by any and all obligations
to, liabilities to or claims asserted by any third parties pertaining to any
injury to or the death of any person or damage to property of third parties or
any obligation of Seller expressly assumed by Purchaser in any way relating to
or arising from the Subject Properties subsequent to Closing (except to the
extent caused by Seller or its agents).
(c) Whenever either party shall learn through the filing of a claim or the
commencement of a proceeding or otherwise of the existence of any liability for
which the other party is or may be responsible under this Contract, the party
learning of such liability shall notify the other party within a reasonable
period of time and furnish copies of such documents (and make originals thereof
available) and such other information as such party may have that may be used or
useful in the defense of such claims and shall afford said other party full
opportunity to defend the same in the name of such party and generally shall
cooperate with said other party in the defense of any such claim.
(d) The provisions of this Section 12.14 shall survive the Closing of this
Contract for a period of one year and six months.
12.15 Return of Documents. Upon termination of this Contract for any reason
by Purchaser or Seller, Purchaser shall have the obligation to return all
Submission Items and copies thereof (including the Survey) to Seller.
12.16 Effect of Holidays. In the event any date specified or computed under
this Contract for the performance of an obligation by either Seller or
Purchaser, or for the occurrence of any event provided for herein, shall be a
Saturday, Sunday or "recognized holiday" (defined for purposes hereof as any
holiday observed by national banks in New York, New York or Chicago, Illinois),
then the date for such performance or occurrence shall be automatically extended
to the next calendar day which is not a Saturday, Sunday or recognized holiday.
12.17 Completion of Documents. The parties hereto understand and agree that
the forms of closing documents which are attached as exhibits hereto may have to
be modified in order to be made appropriate for the transaction contemplated
herein. It is anticipated by the parties that such modifications will consist of
inserting appropriate information in the blanks contained in the forms of
closing documents attached as exhibits hereto.
12.18 Non-Imputation. Purchaser hereby acknowledges that the obligations of
Seller hereunder are those solely of the Seller and not of its partners,
officers, directors, shareholders or affiliates, including, without limitation,
Winthrop Financial Associates, A Limited Partnership, a general partner of each
of the Sellers ("WFA") (collectively, the "Seller Affiliates"). Purchaser hereby
agrees that its sole recourse for any actions, claims, liabilities, damages and
demands of every nature whatsoever, whether known or unknown, arising out of any
matter in connection with or under this Contract or the transactions
contemplated hereby, to the extent specifically provided for by this Contract,
shall be to Seller and that Purchaser shall have no right to seek such damages
from, or allege a cause of action against, the Seller Affiliates; provided,
however, WFA by its execution hereof, hereby agrees that Purchaser shall have
recourse against the assets of WFA in an amount not in excess of $1,500,000,
solely with respect to a breach by Seller of the Covenant not to Distribute, or
in the event such funds which are the subject of the Covenant not to Distribute
are unavailable due to a bankruptcy of Seller. Seller hereby agrees that its
sole recourse for any actions, claims, liabilities, damages and demands of every
nature whatsoever, whether known or unknown, arising out of any matter in
connection with or under this Contract or the transactions contemplated hereby,
to the extent specifically provided for by this Contract, shall be to Purchaser
(or any entity to which this Contract is assigned by Purchaser) and that Seller
shall have no right to seek such damages from, or allege a cause of action
against, Purchaser's partners, or any of their respective partners, members,
managers, officers, directors, shareholders or affiliates, including, without
limitation, The State of California Public Employees' Retirement System and
Hines Interests Limited Partnership.
12.19 Severability. If any term, covenant or condition of this Contract, or
the application thereof to any person or circumstance, shall to any extent be
invalid or unenforceable, the remainder of this Contract, or the application of
such term, covenant or condition to other persons or circumstances, shall not be
affected thereby, and each term, covenant or condition of this Contract shall be
valid and enforceable to the fullest extent permitted by law.
12.20 Title Company. (a) The Title Company shall hold the Earnest Money in
escrow in a separate segregated bank account (or as otherwise agreed in writing
by the Seller and the Purchaser) until the Closing or sooner termination hereof
and shall pay over or apply such proceeds in accordance with the terms of this
Section. The Title Company shall invest the Earnest Money in such manner agreed
to in writing by the Seller and the Purchaser or, in the absence of any such
written instructions, in an interest bearing account at Bank of America. At
Closing, the Earnest Money shall be paid by the Title Company to the Seller and
applied to the Purchase Price as a credit for the Purchaser. The reasonable fees
and expenses of Title Company for the escrow services to be provided hereunder
shall be paid one-half by the Seller and one-half by the Purchaser. If the Title
Company receives a copy of a notice to the Seller from the Purchaser: (i) prior
to the expiration of the Inspection Period, or (ii) prior to February 18, 1999
in the case of the failure to obtain the items called for by Sections 5.6 and
5.7 herein, or (iii) three (3) business days prior to the Closing in the case of
the failure to obtain the item called for by Section 5.8 herein, terminating
this Contract, then the Title Company shall promptly refund the Earnest Money to
the Purchaser, without the necessity of any further notice, act or
authorization, including, without limitation, any notice to or from the Seller,
and notwithstanding any objection or other act or notice by the Seller. The
Seller hereby unconditionally and irrevocably releases the Title Company from
any liability for returning the Earnest Money to the Purchaser in the event the
Purchaser gives such notice of termination of this Contract prior to the
expiration of the Inspection Period, February 18, 1999 or three (3) business
days prior to Closing, as the case may be.
(b) After the expiration of the Inspection Period, or February 18, 1999 in
the case of the failure to obtain the items called for by Sections 5.6 and 5.7
herein or three (3) business days prior to Closing in the case of the failure to
obtain the items called for by Section 5.8 herein, if for any reason Closing
does not occur and either party makes a written demand upon the Title Company
for payment or delivery of the Earnest Money, the Title Company shall give
written notice to the other party of such demand. If the Title Company does not
receive a written objection from the other party to the proposed payment within
ten (10) business days after the giving of such notice, the Title Company is
hereby authorized to make such payment. If the Title Company does receive such
written objection within such ten (10) day period or if for any other reason the
Title Company in good faith shall elect not to make such payment, the Title
Company shall continue to hold the Earnest Money until otherwise directed by
written instructions from the parties hereto or a final judgment of a court of
competent jurisdiction, which by lapse of time or otherwise, shall no longer be
or shall not be subject to appeal or reversal. The Title Company shall, however,
have the right at any time to file a suit with a court of competent jurisdiction
and to deliver or pay the Earnest Money to such court (or an officer thereof).
The Title Company shall give written notice of such deposit to the Seller and
the Purchaser. Upon such deposit, the Title Company shall be relieved of and
discharged from all further obligations and responsibilities hereunder.
(c) The parties acknowledge that the Title Company is acting at their
request and convenience and solely as a stakeholder, that the Title Company
shall not be deemed to be the agent of either of the parties and that the Title
Company shall not be liable to either of the parties for any act or omission on
its part unless taken or suffered in bad faith, in willful disregard of this
Contract or involving gross negligence. The Seller and the Purchaser hereby
jointly and severally indemnify and hold the Title Company harmless from and
against all liabilities, costs, claims and expenses (including reasonable
attorneys' fees) incurred in connection with the performance by the Title
Company of its duties hereunder, except with respect to actions or omissions
taken or suffered by the Title Company in bad faith, in willful disregard of
this Contract or involving gross negligence on the part of the Title Company.
(d) The Title Company may seek the advice of legal counsel in the event of
any dispute or question as to the construction of any of the provisions of this
Section 12.20 of this Contract or its duties hereunder, and it shall incur no
liability and shall be fully protected in respect of any action taken, omitted
or suffered by it in good faith in accordance with the advice of such counsel.
(e) The Title Company may resign at any time upon thirty (30) days prior
written notice. In the case of Title Company's resignation, the Title Company's
only duty, until a successor escrow agent shall have been appointed jointly by
the Seller and the Purchaser and shall have accepted such appointment, shall be
to hold and dispose of the Earnest Money in accordance with the provisions
contained in this Contract (but without regard to any notices, requests,
instructions or demands received by the Title Company from the Seller and/or the
Purchaser after its notice of resignation shall have been given, unless the same
shall be a direction by both the Seller and the Purchaser that the entire
balance of the Earnest Money be delivered out of escrow).
12.21 Attorneys Fees. In the event either party hereto fails to perform any
of its obligations under this Contract or in the event a dispute arises
concerning the meaning or interpretation of any provision of this Contract, the
defaulting party or the party not prevailing in such dispute, as the case may
be, shall pay any and all costs and expenses incurred by the other party in
enforcing or establishing its rights hereunder, including, without limitation,
court costs and reasonable legal fees. The provisions of this Section shall
survive closing or any termination of this Contract.
12.22 Press Releases. Purchaser and Seller further agree that prior to or
after Closing they will not issue any press releases regarding the transaction
contemplated herein without the prior consultation and express written approval
of the other.
12.23 Multiple Counterparts. This Contract may be executed in one or more
counterparts, each of which shall be an original, but all of which shall
constitute one and the same instrument.
12.24 Personal Property and Office Space. Purchaser agrees to make
available to Mark Smith for the period through June 30, 1999 one office in the
Improvements in a location reasonably selected by Purchaser and the Personal
Property identified in Exhibit "B" as "Winthrop VP Office" without cost.
Purchaser shall have the right to relocate such office if it so desires.
12.25 Joint and Several. The obligations of the Seller hereunder shall be
joint and several.
12.26 Fax Signatures. The parties agree that signatures transmitted by
facsimile shall be sufficient to bind the parties to this Contract. The parties
agree to exchange original signature pages within three (3) business days of the
Effective Date of this Contract.
[The remainder of this page left intentionally blank.]
EXECUTED on this ______ day of __________, 199____, by Seller.
MIAMI TOWER ASSOCIATES LIMITED PARTNERSHIP,
a Florida limited partnership
By: Winthrop Miami Associates Limited Partnership,
a Delaware limited partnership,
its managing general partner
By: One International Associates Limited
Partnership, a Delaware limited
partnership, its sole general partner
By: One International, Inc.,
a Delaware corporation,
its sole general partner
By: __________________
Peter Braverman,
Vice President
MIAMI RETAIL ASSOCIATES LIMITED PARTNERSHIP,
a Florida limited partnership
By: Winthrop Miami Associates Limited
Partnership, a Delaware limited
partnership, its managing general partner
By: One International Associates Limited
Partnership, a Delaware limited
partnership, its sole general partner
By: One International, Inc.,
a Delaware corporation,
its sole general partner
By: __________________
Peter Braverman,
Vice President
EXECUTED on this _____ day of __________, 199___, by Purchaser.
NATIONAL OFFICE PARTNERS LIMITED PARTNERSHIP,
a Delaware limited partnership
By: Hines National Office Partners Limited
Partnership, a Texas limited partnership,
its general partner
By: Hines Fund Management, L.L.C.,
a Delaware limited liability company,
its general partner
By: Hines Interests Limited
Partnership, a Delaware limited
partnership, its manager
By: Hines Holdings, Inc.,
a Texas corporation,
its general partner
By: _______________
Name:
Title:
The Contract has been received by the Title Company this _____ day of
__________, 199__. By its execution of this Contract, below, the Title Company
agrees to be bound by the terms hereof to the extent that the Contract imposes
duties upon the Title Company.
COMMONWEALTH LAND TITLE INSURANCE COMPANY
By: ________________________________________
Name: _______________________________________
Title: ______________________________________
<PAGE>
By its execution below, WFA agrees to be bound by the provisions of this
Contract solely as it pertains to Section 12.18.
WINTHROP FINANCIAL ASSOCIATES, A LIMITED
PARTNERSHIP
By: ________________________________________
Name: _______________________________________
Title: ______________________________________
