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): May 30, 1997
GROVE PROPERTY TRUST
(Exact name of registrant as specified in its charter)
Maryland 1-13080 06-1391084
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File No.) Identification Number)
598 Asylum Avenue, Hartford, Connecticut 06105
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code: (860) 246-1126
N/A
(Former name or former address, if changed since last report)
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Item 2. Acquisition or Disposition of Assets
Pursuant to a Contribution Agreement dated as of May 30, 1997
(the "Contribution Agreement"), effective June 1, 1997, Grove Property Trust
(formerly Grove Real Estate Asset Trust), a Maryland real estate investment
trust (the "Company"), acquired two residential apartment complexes through
Grove Operating, L.P., a Delaware limited partnership of which the Company is
the sole general partner (the "Operating Partnership"). These acquisitions were
effected by the Operating Partnership through the acquisition of the assets
(other than certain amounts of cash) and the assumption of liabilities of
Northeast Apartments I LimitedPartnership, the owner of Four Winds Apartments
("Northeast L.P."), and of West Hartford Center Associates, Limited Partnership,
the owner of Brooksyde Apartments ("West Hartford L.P."). In addition,
simultaneously with the acquisition of Four Winds Apartments and Brooksyde
Apartments and through the Operating Partnership, the Company acquired an
interest in Windsor Arbor Limited Partnership, the owner of River's Bend
Apartments ("Windsor Arbor"), and anticipates that it will acquire the remaining
limited partnership interests in Windsor Arbor on or before December 31, 1997.
The Contribution Agreement is among the Operating Partnership, Northeast L.P.,
West Hartford L.P.,Windsor Equity Partnership and Windsor Commons Corporation.
Upon consummation of the transactions referred to above, the
Operating Partnership issued an aggregate of 420,183 Common Units which, under
certain circumstances, could be redeemed for an equal number of Common Shares of
the Company. Based in part on the prices for the Common Shares as reported by
the American Stock Exchange, the Board assigned a value of $10 for each of the
Common Units of the Operating Partnership issued in these transactions. The
Company also assumed mortgage debt on Four Winds Apartments and Brooksyde
Apartments in the aggregate remaining principal amount of $6.2 million. To
complete these transactions, the Company borrowed $1.8 million under its line of
credit and used $68,000 of its available cash.
The Company anticipates that, on or before December 31, 1997,
it will acquire the remaining limited partnership interests in Windsor Arbor for
which it will pay $4.9 million in cash.
Each of these transactions is described in more detail below.
Northeast L.P./Four Winds Apartments
Four Winds Apartments is a 168-unit apartment complex located
in North Fall River, Massachusetts. The complex, which includes six two-story
wood frame buildings, a clubhouse, indoor and outdoor pools, tennis courts and
other recreational facilities, is located on approximately 24 acres of land. The
Company intends to continue to operate the complex as rental apartments.
Four Winds Apartments was acquired pursuant to the
Contribution Agreement. The property was acquired by the Operating Partnership
in exchange for an aggregate of 219,898 Common Units of the Operating
Partnership, which will be distributed by Northeast L.P. to its partners, a cash
contribution by the Operating Partnership to Northeast L.P. and the assumption
of certain debt. The property was transferred to GR-Northeast Apartments I
Limited Partnership, a newly formed limited partnership ("GRNE L.P."). GRNE L.P.
is a Delaware limited partnership which is owned 1% by its general partner
GR-NEALP, Inc., a Delaware corporation and a wholly owned subsidiary of the
Company ("GR-NEALP"), and 99% by its limited partner, the Operating Partnership.
The Company valued the assets of Northeast L.P. including the
Four Winds Apartments using the direct capitalization method. Under this
approach, a single year's income is converted into a market value for a property
through the application of a market-derived capitalization rate (the lower the
capitalization rate applied to a property's income, the higher its value). The
valuation for Northeast L.P. was determined by (i) capitalizing the estimated
net operating income from the Four Winds Apartments for the period from June 1,
1997 through May 31, 1998, less a reserve for capital expenditures, at a
capitalization rate of 9.75%; (ii) deducting the amount of debt on the Four
Winds Apartments; (iii) adding other assets of Northeast L.P., net of
liabilities (such as cash, accounts receivable, accounts payable and security
deposits); (iv) deducting any transfer taxes due upon the restructuring of
Northeast L.P. and (v) deducting an amount equal to 2% of the amount determined
under clause (i) as payment for certain costs incurred by the Operating
Partnership in connection with the transaction. The Company determined the
appropriate capitalization rate for Four Winds Apartments based on its
experience in real estate matters. The Company sought local market sales
information for comparable properties, estimated actual capitalization rates
(net operating income less capital reserves divided by sales price) and then
evaluated the Four Winds Apartments in light of its relative competitive
position, taking into account its location, occupancy rate, overall property
condition and other relevant factors. The Company believes that arms' length
purchasers would base their purchase offers on a capitalization rate
substantially similar to that used to calculate the valuation of the assets of
Northeast L.P.
Of the 219,898 Common Units issued in exchange for Four Winds
Apartments, 2,519 will be distributed to NEALP, Inc., the general partner of
Northeast L.P., in exchange for its general partnership interest. NEALP, Inc. is
a wholly owned subsidiary of Grove Holding Corp. which, in turn, is owned 50% by
Damon D. Navarro, the Chairman of the Board, President and Chief Executive
Officer and a Trustee of the Company, and 50% by Brian A. Navarro, the Vice
President - Acquisitions of the Company. An additional 23,592 Common Units will
be distributed to Grove Equity Partnership in exchange for its special and
investor limited partnership interests in Northeast L.P. Grove Equity
Partnership is a general partnership of which Damon Navarro, Brian Navarro,
Edmund F. Navarro, the Vice President - Property Management and a Trustee of the
Company, and Joseph R. LaBrosse, the Chief Financial Officer and a Trustee of
the Company, are the general partners.
In addition, the Operating Partnership contributed $847,000 to
Northeast L.P. for the purposes of paying down $689,000 of the mortgage debt
secured by Four Winds Apartments and of paying closing costs.
In connection with the acquisition, the mortgage debt secured
by Four Winds Apartments, which was assumed by GRNE L.P., was modified. As
modified and after taking into account the principal payment referred to above,
the remaining principal balance of the loan is $4.2 million. Other modified
terms of the loan reduced payments to interest only, reduced the interest rate
to 30-day LIBOR plus 1.20% and shortened the maturity date of the loan to April
30, 1999.
Based on a value of $10 per Common Unit for the Common Units
of the Operating Partnership issued to Northeast L.P., the cash advanced for the
mortgage paydown and closing costs and the principal amount of the debt assumed,
the total consideration paid by the Company for the Four Winds Apartments was
$7.2 million.
West Hartford L.P./Brooksyde Apartments
Brooksyde Apartments is an 80-unit apartment complex located
in West Hartford, Connecticut. The complex, which includes eight two-story
buildings, is located on approximately 4 acres. The property is located near
retail and recreational facilities. The Company intends to continue to operate
the complex as rental apartments.
Brooksyde Apartments was acquired pursuant to the Contribution
Agreement. The property was acquired by the Operating Partnership in exchange
for an aggregate of 103,074 Common Units of the Operating Partnership, which
will be distributed by West Hartford L.P. to its partners, a cash contribution
by the Operating Partnership to West Hartford L.P. and the assumption of certain
debt. The property was transferred to GR-West Hartford Center Limited
Partnership, a newly formed limited partnership ("GRWH L.P."). GRWH L.P. is a
Delaware limited partnership which is owned 1% by its general partner GR-WHCALP,
Inc., a Delaware corporation and a wholly owned subsidiary of the Company
("GR-WHCALP"), and 99% by its limited partner, the Operating Partnership.
The Company valued the assets of West Hartford L.P. including
the Brooksyde Apartments using the direct capitalization method. Under this
approach, a single year's income is converted into a market value for a property
through the application of a market-derived capitalization rate (the lower the
capitalization rate applied to a property's income, the higher its value). The
valuation for West Hartford L.P. was determined by (i) capitalizing the
estimated net operating income from Brooksyde Apartments for the period from
June 1, 1997 through May 31, 1998, less a reserve for capital expenditures, at a
capitalization rate of 9.1%; (ii) deducting the amount of debt on the Brooksyde
Apartments; (iii) adding other assets of West Hartford L.P., net of liabilities
(such as cash, accounts receivable, accounts payable and security deposits);
(iv) deducting any transfer taxes due upon the restructuring of West Hartford
L.P. and (v) deducting an amount equal to 2% of the amount determined under
clause (i) as payment for certain costs incurred by the Operating Partnership in
connection with the transaction. The Company determined the appropriate
capitalization rate for Brooksyde Apartments based on its experience in real
estate matters. The Company sought local market sales information for comparable
properties, estimated actual capitalization rates (net operating income less
capital reserves divided by sales price) and then evaluated the Brooksyde
Apartments in light of its relative competitive position, taking into account
its location, occupancy rate, overall property condition and other relevant
factors. The Company believes that arms' length purchasers would base their
purchase offers on a capitalization rate substantially similar to that used to
calculate the valuation of the assets of West Hartford L.P.
Of the 103,074 Common Units issued in exchange for Four Winds
Apartments, 1,234 will be distributed to WHCALP, Inc., the general partner of
West Hartford L.P., in exchange for its general partnership interest. WHCALP,
Inc. is a wholly owned subsidiary of Grove Holding Corp. which, in turn, is
owned 50% by Damon D. Navarro, the Chairman of the Board, President and Chief
Executive Officer and a Trustee of the Company, and 50% by Brian A. Navarro, the
Vice President - Acquisitions of the Company. An additional 5,169 Common Units
will be distributed to Grove Equity Partnership in exchange for its special and
investor limited partnership interests in West Hartford L.P. Grove Equity
Partnership is a general partnership of which Damon Navarro, Brian Navarro,
Edmund F. Navarro, the Vice President - Property Management and a Trustee of the
Company, and Joseph R. LaBrosse, the Chief Financial Officer and a Trustee of
the Company, are the general partners.
In addition, the Operating Partnership contributed $205,000 to
West Hartford L.P. for the purposes of paying down $113,000 of the mortgage debt
secured by Brooksyde Apartments and of paying closing costs.
In connection with the acquisition, the mortgage debt secured
by Brooksyde Apartments, which was assumed by GRWH L.P., was modified. As
modified and after taking into account the principal payment referred to above,
the remaining principal balance of the loan is $2.0 million. Other modified
terms of the loan reduced payments to interest only, reduced the interest rate
to 30-day LIBOR plus 1.20% and shortened the maturity date of the loan to May
15, 2000.
Based on a value of $10 per Common Unit for the Common Units
of the Operating Partnership issued to West Hartford L.P., the cash advanced for
the mortgage paydown and closing costs and the principal amount of the debt
assumed, the total consideration paid by the Company for the Brooksyde
Apartments was $3.2 million.
Windsor Arbor/River's Bend Apartments
River's Bend Apartments is a 347-unit apartment complex
located in Windsor, Connecticut. The complex, which includes 33 two-story
buildings, outdoor and indoor pools and a fitness center, is located on
approximately 72 acres of land. The Company intends to continue to operate the
complex as rental apartments.
The Company's interest in River's Bend Apartments was acquired
pursuant to the Contribution Agreement. The Company's interest in the property
was acquired through the acquisition by GPT-Windsor, LLC, a Delaware limited
liability company wholly owned by the Operating Partnership ("GPT-Windsor"),of
the general partnership interest, the special limited partnership interests and
the investor limited partnership interests (other than those owned by the
Nonaffiliated Limited Partners (as defined below)) in exchange for an aggregate
of 97,211 Common Units of the Operating Partnership and a cash contribution by
the Operating Partnership to Windsor Arbor.
The Company valued the assets of Windsor Arbor including the
River's Bend Apartments using the direct capitalization method. Under this
approach, a single year's income is converted into a market value for a property
through the application of a market-derived capitalization rate (the lower the
capitalization rate applied to a property's income, the higher its value). The
valuation for Windsor Arbor was determined by (i) capitalizing the estimated net
operating income from the River's Bend Apartments for the period from June 1,
1997 through May 31, 1998, less a reserve for capital expenditures, at a
capitalization rate of 9.3%; (ii) deducting the amount of debt on the River's
Bend Apartments; (iii) adding other assets of Windsor Arbor, net of liabilities
(such as cash, accounts receivable, accounts payable and security deposits);
(iv) deducting any transfer taxes due upon the restructuring of Windsor Arbor
and (v) deducting an amount equal to 2% of the amount determined under clause
(i) as payment for certain costs incurred by the Operating Partnership in
connection with the transaction. The Company determined the appropriate
capitalization rate for River's Bend Apartments based on its experience in real
estate matters. The Company sought local market sales information for comparable
properties, estimated actual capitalization rates (net operating income less
capital reserves divided by sales price) and then evaluated the River's Bend
Apartments in light of its relative competitive position, taking into account
its location, occupancy rate, overall property condition and other relevant
factors. The Company believes that arms' length purchasers would base their
purchase offers on a capitalization rate substantially similar to that used to
calculate the valuation of the assets of Windsor Arbor.
Of the 97,211 Common Units issued in exchange for the
interests in Windsor Arbor acquired by GPT-Windsor, 5,872 were distributed to
Windsor Commons Corp. in exchange for its general partnership interest. Windsor
Commons Corp. is a wholly owned subsidiary of Grove Holding Corp. which, in
turn, is owned 50% by Damon D. Navarro, the Chairman of the Board, President and
Chief Executive Officer and a Trustee of the Company, and 50% by Brian A.
Navarro, the Vice President - Acquisitions of the Company. An additional 39,680
Common Units were distributed to Grove Equity Partnership in exchange for its
special and investor limited partnership interests in Windsor Arbor. Grove
Equity Partnership is a general partnership of which Damon Navarro, Brian
Navarro, Edmund F. Navarro, the Vice President - Property Management and a
Trustee of the Company, and Joseph R. LaBrosse, the Chief Financial Officer and
a Trustee of the Company, are the general partners.
In addition, the Operating Partnership contributed $840,000 to
Windsor Arbor for the purposes of paying down $535,000 of the mortgage debt
secured by River's Bend Apartments and of paying closing costs.
In connection with the transaction, the mortgage debt secured
by River's Bend Apartments was modified. As modified and after taking into
account the principal payment referred to above, the remaining principal balance
of the loan is $8.6 million. Other modified terms of the loan reduced payments
to interest only, reduced the interest rate to 30-day LIBOR plus 1.20% and
shortened the maturity date of the loan to May 15, 2000. Upon the liquidation of
Windsor Arbor, this mortgage debt will be assumed by GPT-Windsor.
In connection with this transaction, a First Amendment to the Agreement of
Limited Partnership of Windsor Arbor wil be entered into. This amendment
substitutes GPT-Windsor, LLC, a Delaware limited liability company wholly owned
by the Operating Partnership ("GPT-Windsor"), as the general partner of Windsor
Arbor. In addition, the First Amendment provides that holders of the investor
limited partnership interests in Windsor Arbor not owned by GPT-Windsor (the
"Nonaffiliated Limited Partners") will be entitled to receive $4.9 million in
cash upon the liquidation of Windsor Arbor. Such a liquidation will occur on or
before December 31, 1997 upon notice from the Nonaffiliated Limited Partners. If
notice of such liquidation is not given by the Nonaffiliated Limited Partners by
November 30, 1997, such liquidation will occur upon notice from GPT-Windsor, as
general partner, on or after December 1, 1997 and on or before December 31,
1997. Upon the liquidation of Windsor Arbor, $4.9 million will be paid to the
Nonaffiliated Limited Partners in cash and all of the remaining assets of
Windsor Arbor will be distributed to GPT-Windsor, subject to all liabilities. It
is the intention of GPT-Windsor that, if the Nonaffiliated Limited Partners do
not give notice of their election to cause the liquidation of Windsor Arbor, it
will give such notice so that River's Bend Apartments will be wholly owned by
GPT-Windsor not later than December 31, 1997.Based on a value of $10 per Common
Unit for the Common Units of the Operating Partnership issued to the partners of
Windsor Arbor and the cash advanced for the mortgage paydown and closing costs,
the Company paid an aggregate of $1.8 million for the interests in Windsor Arbor
which it acquired. Upon the liquidation of Windsor Arbor, the Company will pay
an additional $4.9 million to the Nonaffiliated Limited Partners, and
GPT-Windsor will assume mortgage debt with an outstanding principal amount of
approximately $8.6 million for a total acquisition cost of $15.3 million.
As noted above, in valuing each of the properties acquired, an
adjustment was made to cover certain costs incurrd by the Operating Partnership
in connection with the transactions. Based on the values of the assets acquired,
the aggregate amount of this adjustment was $522,000. Such amount will be used
by the Operating Partnership to pay legal, accounting, title insurance and other
costs payable to entities unaffiliated with the Company. The balance of the
$522,000 remaining after the payment of such expenses will be paid to National
Realty Services, L.P., a Delaware limited partnership ("National Realty
Services"), for services in connection with investor communications, negotiation
of the Contribution Agreement and related agreements, financial analyses of the
acquisitions and structuring the transactions. The amount to be paid to National
Realty Services cannot be determined at this time. National Realty Services is
owned by Damon D. Navarro, the Chairman of the Board, President and Chief
Executive Officer of the Company, Joseph R. LaBrosse, the Chief Financial
Officer and a Trustee of the Company, Edmund F. Navarro, the Vice President
Property Management and a Trustee of the Company, and Brian A. Navarro, the Vice
President - Acquisitions of the Company.
Item 7. Financial Statements and Exhibits.
(a) Financial statements of Northeast L.P., West Hartford L.P. and
Windsor Arbor for the periods specified in Regulation S-X will be included in an
amendment to this report as soon as practicable, but not later than 60 days
after the date on which this report is required to be filed.
(b) Pro forma financial statements for the periods specified in
Regulation S-K will be included in an amendment to this report as soon as
practicable, but not later than 60 days after the date on which this report is
required to be filed.
(c) Exhibits.
Exhibit No. Description
2.1 Contribution Agreement, dated as of May 30, 1997, by and
between Grove Operating, L.P., Northeast Apartments I
Limited Partnership, West Hartford Center Associates
Limited Partnership, Windsor Equity Partnership and Windsor
Commons Corporation
2.2 First Amendment effective as of June 1, 1997 to Agreement of
Limited Partnership of Windsor Arbor Limited Partnership
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Company has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
GROVE PROPERTY TRUST
Date: June 16, 1997 By: /s/ Joseph R. LaBrosse
---------------------------
Joseph R. LaBrosse
Chief Financial Officer
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Exhibit Index
Exhibit No. Description
2.1 Contribution Agreement, dated as of May 30, 1997, by and
between Grove Operating,L.P., Northeast Apartments I Limited
Partnership, West Hartford Center Associates Limited Partnership,
Windsor Equity Partnership and Windsor Commons Corporation
2.2 Form of First Amendment effective as of June 1, 1997 to Agreement
of Limited Partnership of Windsor Arbor Limited Partnership
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CONTRIBUTION AGREEMENT
by and between
GROVE OPERATING, L.P.,
a Delaware limited partnership,
NORTHEAST APARTMENTS I LIMITED PARTNERSHIP,
a Connecticut limited partnership,
WEST HARTFORD CENTER ASSOCIATES LIMITED PARTNERSHIP,
a Connecticut limited partnership,
WINDSOR EQUITY PARTNERSHIP,
a Connecticut general partnership,
and
WINDSOR COMMONS CORPORATION,
a Connecticut corporation
DATED: As of May 30, 1997
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CONTRIBUTION AGREEMENT
THIS CONTRIBUTION AGREEMENT (the "Agreement") is made as of this 30th
day of May, 1997, by and between: GROVE OPERATING, L.P., a Delaware limited
partnership (the "Operating Partnership"), NORTHEAST APARTMENTS I LIMITED
PARTNERSHIP, a Connecticut limited partnership, ("Northeast"), WEST HARTFORD
CENTER ASSOCIATES LIMITED PARTNERSHIP, a Connecticut limited partnership ("West
Hartford Center"), WINDSOR EQUITY PARTNERSHIP, a Connecticut general
partnership, ("Windsor Equity"), and WINDSOR COMMONS CORPORATION, a Connecticut
corporation ("Windsor Commons").
W I T N E S E T H:
WHEREAS, West Hartford Center and Northeast each own a multi-family
residential project and certain other assets, and Windsor Equity and Windsor
Commons own partnership interests in Windsor Arbor Limited Partnership, a
Connecticut limited partnership, all as set forth herein. Northeast, West
Hartford Center, Windsor Equity and Windsor Commons are hereinafter referred to
as the "Contributors".
WHEREAS, the Contributors desire to contribute to the Operating
Partnership or its designee all of their respective rights, title and interests
in and to such assets in exchange for Units (as hereinafter defined) pursuant to
and in accordance with this Agreement.
NOW, THEREFORE, in consideration of the foregoing premises and the
respective representations, warranties, agreements, covenants and conditions
herein contained, and other good and valuable consideration, the parties hereby
agree as follows:
ARTICLE 1.
DEFINITIONS
1.1 Definitions. As used herein, the following terms shall have the
respective meanings indicated below:
Agreement: This Contribution Agreement, including the schedules attached
hereto, as this Contribution Agreement may be, amended, supplemented or modified
from time to time.
Closing: As defined in Section 5.1 hereof.
Closing Date: As defined in Section 5.1 hereof.
Contributors: As defined in the first Whereas clause of this
Agreement.
Damages: Any loss, liability, claim, obligation, damage or expense
(including reasonable legal fees and expenses).
Environment: Soil, surface waters, ground waters, land, stream sediments,
surface or subsurface strata and ambient air.
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Environmental Laws: Any and all federal, state and local statutes,
laws, regulations, ordinances, rules, judgments, orders, decrees, permits,
concessions, grants, franchises, licenses, agreements or other governmental
restrictions relating to the Environment or to emissions, discharges, releases
or threatened releases of pollutants, contaminants, chemicals, or industrial,
toxic or hazardous substances or wastes into the Environment, or otherwise
relating to the manufacture, processing, distribution, use, treatment, storage,
disposal, transport, or handling of pollutants, contaminants, chemicals, or
industrial, toxic or hazardous substances or wastes.
ERISA: The Employee Retirement Income Security Act of 1974, as amended
from time to time.
Expenses: As defined in Section 9.1 hereof.
GPT-Windsor: GPT-Windsor, LLC, a Delaware limited liability company
directly or indirectly owned and controlled by Grove Property Trust and the
Operating Partnership.
GR-Northeast: GR-Northeast Apartments I Limited Partnership, a Delaware
limited partnership directly or indirectly owned and controlled by Grove
Property Trust and the Operating Partnership.
GR-West Hartford Center: GR-West Hartford Center Limited Partnership, a
Delaware limited partnership indirectly owned and controlled by Grove Property
Trust and the Operating Partnership.
Hazardous Materials: As defined in Section 4.1.I hereof.
Material Adverse Effect: With respect to any Person, a material
adverse effect on the properties, business, results of operation or
financial condition of such Person.
New Partnerships: GR-Northeast and GR-West Hartford Center.
Northeast: As defined in the caption to this Agreement.
Northeast Improvements: As defined in Section 2.2(b).
Northeast Intangible Property: As defined in Section 2.2(d).
Northeast Leases: As defined in Section 2.2(e).
Northeast Personalty: As defined in Section 2.2(c).
Northeast Project: As defined in Section 2.2.
Northeast Real Estate: As defined in Section 2.2(a).
Obligations: All payments required to be made and all representations,
warranties, covenants, agreements and commitments required to be performed under
the provisions of this Agreement by the Contributors or the Operating
Partnership, as applicable.
Operating Partnership: As defined in the caption to this Agreement.
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Owners: Collectively, Northeast, West Hartford Center and Windsor Arbor.
Partnership Improvements: The Northeast Improvements, the West
Hartford Center Improvements, and the Windsor Improvements.
Partnership Intangible Property: The Northeast Intangible Property,
the West Hartford Center Intangible Property and the Windsor Intangible
Property.
Partnership Leases: The Northeast Leases, the West Hartford Center
Leases, and the Windsor Leases.
Partnership Personalty: The Northeast Personalty, the West Hartford
Center Personalty, and the Windsor Personalty.
Partnership Projects: The Northeast Projects, the West Hartford Center
Projects, and the Windsor Projects.
Partnership Real Estate: The Northeast Real Estate, the West Hartford
Center Real Estate, and
the Windsor Real Estate.
Permitted Exceptions: Any liens, encumbrances, restrictions, exceptions
and other matters specified on the Searches, Title Commitments, Title Policies
or Surveys, to which title to the Partnership Real Estate may be subject on the
Closing Date.
Person: Any individual, a partnership, a joint venture, a corporation,
a trust, a limited liability company, an unincorporated organization or a
government or any department or agency thereof.
Property-Related Representations and Warranties: The representations
and warranties of the Contributors set forth in subsections 4.1(f) - 4.1(i),
4.1(k) - 4.1(w), 4.2(f) - 4.2(i) and 4.2(k) - 4.2(w).
Searches: As defined in Section 5.3(c) hereof.
Securities Act: As defined in Section 4.1(aa) hereof.
Service Contracts: All laundry equipment leases, management, leasing,
repair, maintenance, operating, supply, purchase, consulting, advertising,
service, equipment, concession and other contracts, commitments and agreements
(excluding the Partnership Leases) relating to the Partnership Real Estate.
Surveys: Collectively, the surveys for the Partnership Projects
delivered in accordance with Section 5.3(a) hereof.
Title Commitments: Collectively, the commitments for title insurance
delivered in accordance with Section 5.3(b) hereof.
Title Defect: Any lien, claim, charge, security interest, restriction,
title exception, defect or
encumbrance other than a Permitted Exception.
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Title Policies: Collectively, the policies of title insurance
delivered in accordance with Sec- tion 5.3 hereof.
Transfer: As defined in Section 4.1(aa) hereof.
Units: Units of beneficial interest in the Operating Partnership. All
Units referred to in this Agreement shall be Units of limited partnership
interest.
Unit Value: The per Unit value of the Units at the Closing Date.
West Hartford Center: As defined in the caption to this Agreement.
West Hartford Center Improvements: As defined in Section 2.3(b).
West Hartford Center Intangible Property: As defined in Section 2.3(d).
West Hartford Center Leases: As defined in Section 2.3(e).
West Hartford Center Personalty: As defined in Section 2.3(c).
West Hartford Center Project: As defined in Section 2.3.
West Hartford Center Real Estate: As defined in Section 2.3(a).
Windsor Amendment: The First Amendment to Windsor Arbor Limited
Partnership Agreement of Limited Partnership in the form of Schedule G
hereto.
Windsor Arbor: Windsor Arbor Limited Partnership, a Connecticut
limited partnership.
Windsor Commons: As defined in the caption to this Agreement.
Windsor Contributors: Windsor Equity and Windsor Commons Contributors
of interests in Windsor Arbor.
Windsor Equity: As defined in the caption to this Agreement.
Windsor Improvements: The apartment complexes, ancillary parking lots,
and any and all other improvements and structures located on the Windsor
Real Estate.
Windsor Intangible Property: All intangible property or interest
therein now or hereafter owned or held by Windsor between the date hereof and
the date of the Closing in connection with the Windsor Real Estate (or any
portion thereof), the Windsor Improvements, the Windsor Personalty or any
business or businesses conducted on the Windsor Real Estate, or on any portion
thereof, or in connection with the ownership, operation, management or use
thereof, including (1) any trade style or trade name used in connection with the
Windsor Real Estate; (2) any assignable Service Contracts; (3) all "as-built"
plans and specifications or other construction drawings of any type in Windsor's
possession or control prepared in connection with the construction of the
Windsor Improvements; (4) all tests, studies and reports in Windsor's possession
or control prepared with respect to the Windsor Real Estate or the Windsor
Improvements (including any environmental reports); (5) all of
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Windsor's books and records with respect to the Windsor Real Estate or the
Windsor Improvements; and (6) all assignable guarantees and warranties
(including guarantees and warranties pertaining to the construction of the
Windsor Improvements or pertaining to the acquisition of the Windsor Real
Estate, or any parcel thereof, or any of the Windsor Improvements by Windsor)
licenses and other governmental permits, approvals and permissions (including
the certificate of occupancy) relating to the Windsor Real Estate, or any
portion thereof, the Windsor Improvements, or the ownership, operation,
management or use thereof.
Windsor Interests: The partnership interests of the Windsor
Contributors in Windsor Arbor, as identified in Schedule A hereto.
Windsor Leases: All leases or occupancy agreements for any units in
the Windsor Improvements or for any other portion of the Windsor Real
Estate or the Windsor Improvements.
Windsor Personalty: All fixtures and other personal and tangible
property or interest therein owned by the Windsor, including the heating,
sprinkler, plumbing, air conditioning and ventilation systems, furniture,
appliances, blinds, office equipment and furniture, supplies, replacements,
machinery, equipment, and any other personal property or interest therein owned
by Windsor, now or hereafter located on the Windsor Real Estate, or on any
portion thereof, or in any of the Windsor Improvements, or used in connection
with the ownership, operation, management or use of the Windsor Real Estate, or
any portion thereof, or any of the Windsor Improvements.
Windsor Project: The Windsor Real Estate, the Windsor Improvements,
the Windsor Personalty, the Windsor Intangible Property and the Windsor
Leases.
Windsor Real Estate: All of the land described on Schedule B-3 attached
hereto and made a part hereof, together with all of the rights, privileges,
easements and appurtenances belonging or appertaining to such land, including
all oil, gas and mineral rights belonging to Windsor, all right, title and
interest of Windsor in and to all land lying in any street, alley, road or
avenue, open or proposed, in front of or adjoining such land, to the centerline
thereof, all rights-of-way adjacent to such land and all right, title and
interest of Windsor in and to any award made or to be made in lieu thereof and
in and to any unpaid award for damage to such land by reason of change of grade
of any street.
1.2 References. Except as otherwise specifically indicated, all
references to Section and Subsection numbers refer to Sections and Subsections
of this Agreement, and all references to Schedules refer to the Schedules
attached hereto. The words "hereby," "hereof," "herein," "hereto," "hereunder,"
"hereinafter," and words of similar import refer to this Agreement as a whole
and not to any particular Section or Subsection hereof. The word "hereafter"
shall mean after, and the term "heretofore" shall mean before, the date of this
Agreement. The word "including" shall mean "including, without limitation."
Captions used herein are for convenience only and shall not be used to construe
the meaning of any part of this Agreement.
ARTICLE 2.
CONTRIBUTION AND ACCEPTANCE; OTHER TRANSACTIONS
2.1 Windsor Arbor. Subject to the terms and conditions contained in
this Agreement:
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(a) Each of the Windsor Contributors hereby agrees to
contribute and/or assign its Windsor Interests to the Operating Partnership. The
Operating Partnership hereby instructs the Windsor Contributors to convey and
assign on behalf of the Operating Partnership the Windsor Interests directly to
GPT-Windsor, and the Operating Partnership shall cause GPT-Windsor to accept,
the Windsor Interests.
(b) At the Closing, the Operating Partnership shall cause
GPT-Windsor to enter into the Windsor Amendment pursuant to which GPT-Windsor
will be admitted into Windsor Arbor as the general partner and otherwise
undertake its obligations and entitled to its rights thereunder.
(c) Notwithstanding the foregoing, at the Closing, Windsor
Common shall remain as the general partner of, and shall retain a .01%
partnership interest in, Windsor Arbor.
2.2 Northeast. Subject to the terms and conditions of this Agreement,
Northeast hereby agrees to contribute the Northeast Project to the Operating
Partnership. The Operating Partnership hereby instructs Northeast to convey on
behalf of the Operating Partnership the Northeast Project directly to
GR-Northeast, and the Operating Partnership shall cause GR-Northeast to accept
the Northeast Project. The "Northeast Project" includes:
(a) All of the land described on Schedule B-1 attached hereto
and made a part hereof, together with all of the rights, privileges, easements
and appurtenances belonging or appertaining to such land, including all oil, gas
and mineral rights belonging to Northeast, all right, title and interest of
Northeast in and to all land lying in any street, alley, road or avenue, open or
proposed, in front of or adjoining such land, to the centerline thereof, all
rights-of-way adjacent to such land and all right, title and interest of
Northeast in and to any award made or to be made in lieu thereof and in and to
any unpaid award for damage to such land by reason of change of grade of any
street (such land and all such rights, privileges, easements and appurtenances
are collectively referred to herein as the "Northeast Real Estate").
(b) The apartment complexes, ancillary parking lots, and any
and all other improvements and structures located on the Northeast Real Estate
(hereinafter collectively called the "Northeast Improvements").
(c) All fixtures and other personal and tangible property or
interest therein owned by the Northeast, including the heating, sprinkler,
plumbing, air conditioning and ventilation systems, furniture, appliances,
blinds, office equipment and furniture, supplies, replacements, machinery,
equipment, and any other personal property or interest therein owned by
Northeast, now or hereafter located on the Northeast Real Estate, or on any
portion thereof, or in any of the Northeast Improvements, or used in connection
with the ownership, operation, management or use of the Northeast Real Estate,
or any portion thereof, or any of the Northeast Improvements (all of the
foregoing are hereinafter collectively called the "Northeast Personalty").
(d) All intangible property or interest therein now or
hereafter owned or held by Northeast between the date hereof and the date of the
Closing in connection with the Northeast Real Estate (or any portion thereof),
the Northeast Improvements, the Northeast Personalty or any business or
businesses conducted on the Northeast Real Estate, or on any portion thereof, or
in connection with the ownership, operation, management or use thereof,
including (1) any trade style or trade name used in connection with the
Northeast Real Estate; (2) any assignable Service Contracts; (3) all "as-built"
plans and specifications or other construction drawings of any type in
Northeast's possession or control
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prepared in connection with the construction of the Northeast Improvements; (4)
all tests, studies and reports in Northeast's possession or control prepared
with respect to the Northeast Real Estate or the Northeast Improvements
(including any environmental reports); (5) all of Northeast's books and records
with respect to the Northeast Real Estate or the Northeast Improvements; and (6)
all assignable guarantees and warranties (including guarantees and warranties
pertaining to the construction of the Northeast Improvements or pertaining to
the acquisition of the Northeast Real Estate, or any parcel thereof, or any of
the Northeast Improvements by Northeast) licenses and other governmental
permits, approvals and permissions (including the certificate of occupancy)
relating to the Northeast Real Estate, or any portion thereof, the Northeast
Improvements, or the ownership, operation, management or use thereof (all of the
foregoing are hereinafter collectively called the "Northeast Intangible
Property").
(e) All leases or occupancy agreements for any units in the
Northeast Improvements or for any other portion of the Northeast Real Estate or
the Northeast Improvements (the "Northeast Leases").
2.3 West Hartford Center. Subject to the terms and conditions of this
Agreement, West Hartford Center hereby agrees to contribute the West Hartford
Center Project to the Operating Partnership. The Operating Partnership hereby
instructs West Hartford Center to convey on behalf of the Operating Partnership,
the West Hartford Center Project directly to GR-West Hartford Center, and the
Operating Partnership shall cause GR-West Hartford Center to accept the West
Hartford Center Project. The "West Hartford Center Project" includes:
(a) All of the land described on Schedule B-2 attached hereto
and made a part hereof, together with all of the rights, privileges, easements
and appurtenances belonging or appertaining to such land, including all oil, gas
and mineral rights belonging to West Hartford Center, all right, title and
interest of West Hartford Center in and to all land lying in any street, alley,
road or avenue, open or proposed, in front of or adjoining such land, to the
centerline thereof, all rights-of-way adjacent to such land and all right, title
and interest of West Hartford Center in and to any award made or to be made in
lieu thereof and in and to any unpaid award for damage to such land by reason of
change of grade of any street (such land and all such rights, privileges,
easements and appurtenances are collectively referred to herein as the "West
Hartford Center Real Estate").
(b) The apartment complexes, ancillary parking lots, and any
and all other improvements and structures located on the West Hartford Center
Real Estate (hereinafter collectively called the "West Hartford Center
Improvements").
(c) All fixtures and other personal and tangible property or
interest therein owned by the West Hartford Center, including the heating,
sprinkler, plumbing, air conditioning and ventilation systems, furniture,
appliances, blinds, office equipment and furniture, supplies, replacements,
machinery, equipment, and any other personal property or interest therein owned
by West Hartford Center, now or hereafter located on the West Hartford Center
Real Estate, or on any portion thereof, or in any of the West Hartford Center
Improvements, or used in connection with the ownership, operation, management or
use of the West Hartford Center Real Estate, or any portion thereof, or any of
the West Hartford Center Improvements (all of the foregoing are hereinafter
collectively called the "West Hartford Center Personalty").
(d) All intangible property or interest therein now or
hereafter owned or held by West Hartford Center between the date hereof and the
date of the Closing in connection with the West
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Hartford Center Real Estate (or any portion thereof), the West Hartford Center
Improvements, the West Hartford Center Personalty or any business or businesses
conducted on the West Hartford Center Real Estate, or on any portion thereof, or
in connection with the ownership, operation, management or use thereof,
including (1) any trade style or trade name used in connection with the West
Hartford Center Real Estate; (2) any assignable Service Contracts; (3) all
"as-built" plans and specifications or other construction drawings of any type
in West Hartford Center's possession or control prepared in connection with the
construction of the West Hartford Center Improvements; (4) all tests, studies
and reports in West Hartford Center's possession or control prepared with
respect to the West Hartford Center Real Estate or the West Hartford Center
Improvements (including any environmental reports); (5) all of West Hartford
Center's books and records with respect to the West Hartford Center Real Estate
or the West Hartford Center Improvements; and (6) all assignable guarantees and
warranties (including guarantees and warranties pertaining to the construction
of the West Hartford Center Improvements or pertaining to the acquisition of the
West Hartford Center Real Estate, or any parcel thereof, or any of the West
Hartford Center Improvements by West Hartford Center) licenses and other
governmental permits, approvals and permissions (including the certificate of
occupancy) relating to the West Hartford Center Real Estate, or any portion
thereof, the West Hartford Center Improvements, or the ownership, operation,
management or use thereof (all of the foregoing are hereinafter collectively
called the "West Hartford Center Intangible Property").
(e) All leases or occupancy agreements for any units in the
West Hartford Center Improvements or for any other portion of the West Hartford
Center Real Estate or the West Hartford Center Improvements (the "West Hartford
Center Leases").
ARTICLE 3.
CONSIDERATION
3.1 Units. In consideration of the contributions, conveyances,
assignments and transfers to be made by the Contributors under Article 2 hereof,
the Operating Partnership agrees to issue and sell to each Contributor the Units
set forth with respect to such Contributor set forth on Schedule A hereto.
3.2 GPT-Windsor Admission to Windsor Arbor. Upon Closing, the Operating
Partnership shall cause GPT-Windsor to accept the Windsor Interests and be
admitted to Windsor Arbor as a special limited partner. Upon execution of the
Windsor Amendment by all necessary parties, the Operating Partnership will cause
GPT-Windsor to accept the remaining interests of Windsor Common and be admitted
to Windsor Arbor as the general partner.
ARTICLE 4.
COVENANTS, REPRESENTATIONS AND WARRANTIES
4.1 Representations and Warranties of the Windsor Contributors. To
induce the Operating Partnership to execute, deliver and perform this Agreement,
each of the Windsor Contributors represents and warrants, jointly and severally,
to the Operating Partnership on and as of the date hereof as follows:
(a) Existence. Each Windsor Contributor that is not a natural
person, and Windsor Arbor (i) is duly organized and validly existing under the
laws of the state of its organization; (ii) has all requisite power, and has all
material governmental licenses, authorizations, consents and
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approvals necessary to own its assets and carry on its business as now being or
as proposed to be conducted; and (iii) is qualified to do business in all
jurisdictions in which the nature of the business conducted by it makes such
qualification necessary, except where the failure to be so qualified would not
have a Material Adverse Effect on such Windsor Contributor.
(b) Authorization, Execution, Etc.. Each Windsor Contributor
has, in the case of any Windsor Contributor other than an individual, all
necessary power and authority, and in the case of a natural person, the legal
capacity to execute, deliver and perform its obligations under this Agreement;
the execution, delivery and performance by each Windsor Contributor of this
Agreement have been duly authorized by all necessary action on its part; and
this Agreement has been duly and validly executed and delivered by each Windsor
Contributor and constitutes its legal, valid and binding obligation, enforceable
in accordance with its terms, subject to bankruptcy, insolvency, moratorium or
other similar laws affecting the enforcement of creditors' rights in general and
to general principles of equity.
(c) No Breach. None of the execution and delivery of this
Agreement, the consummation of the transactions contemplated hereby and
compliance with the terms and provisions hereof by the Windsor Contributors will
conflict with or result in a breach of, or require any consent (except such
consents as have been obtained) under (i) the organizational documents of any
Windsor Contributor or Windsor Arbor, (ii) any material applicable law or
regulation, or any order, writ, injunction or decree of any court or
governmental authority or agency, or (iii) any material agreement or instrument
to which any Windsor Contributor or Windsor Arbor is a party or by which it is
bound or to which it is subject, or constitute a default under any such
agreement or instrument, or result in the creation or imposition of any lien
upon any of the revenues or assets of any Windsor Contributor or Windsor Arbor
pursuant to the terms of any such agreement or instrument.
(d) Litigation. There are no legal or arbitral proceedings or
any proceedings by or before any governmental or regulatory authority or agency,
now pending or, to the knowledge of the Windsor Contributors, threatened against
any of the Windsor Contributors or Windsor Arbor, except for such proceedings
which, if decidedly adversely to such Person would not have a Material Adverse
Effect on such Person.
(e) Approvals. The Windsor Contributors have obtained all
material authorizations, approvals or consents of, and have made all material
filings or registrations with, any governmental or regulatory authority or
agency that are necessary for the execution, delivery or performance by the
Windsor Contributors of this Agreement or for the validity or enforceability
thereof.
(f) Rent Roll. Schedule C hereto is a true and correct list of
the rent rolls for the Windsor Project as of May 31, 1997. The rent roll is a
true and correct rent roll for the applicable Windsor Project, showing, for each
apartment unit the following information: (i) whether the unit is occupied and,
if occupied, (ii) the name(s) of the tenant(s), (iii) the amount of rent, (iv)
the amount of any security deposit and (v) the starting and termination date of
the lease term.
(g) Parties In Possession. Except as shown on the rent roll
listed on Schedule C- 1, no Person is in possession of the Windsor Project or
any portion thereof, and no Person has any interest in the Windsor Project, or
any portion thereof, except for Windsor Arbor.
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(h) Leases. A correct and complete copy of each Windsor Lease
(including all amendments thereto) has been provided to GPT-Windsor and each
Windsor Lease is unmodified (except for such amendments) and in full force and
effect and neither Windsor Arbor nor, to the Windsor Contributors' knowledge,
any other party to any thereof is in default thereunder, other than rental
delinquencies in the normal course of business.
(i) Hazardous Materials. To the Windsor Contributors'
knowledge, except as disclosed in Schedule D hereto or in any environmental
reports or audits furnished to the Operating Partnership prior to the date
hereof, Windsor Arbor has obtained all permits, licenses and other
authorizations which it is required to obtain under all Environmental Laws, and
Windsor Arbor is in compliance with the terms and conditions of all such
permits, licenses and authorizations, and is also in compliance in all material
respects with all other limitations, restrictions, conditions, standards,
prohibitions, requirements, obligations, schedules and timetables contained in
any applicable Environmental Law or in any regulation, code, plan, order,
decree, judgment, injunction, notice or demand letter issued, entered,
promulgated or approved thereunder.
In addition, to the Windsor Contributors' knowledge, except as
disclosed in Schedule D hereto or in any environmental reports or audits
furnished to the Operating Partnership prior to the date hereof:
No notice, notification, demand, request for information,
citation, summons or order has been issued, no complaint has been
filed, no penalty has been assessed and no investigation or review is
pending or threatened, by any governmental or other entity with respect
to any alleged failure by Windsor Arbor to have any permit, license or
authorization required in connection with the conduct of its business
with respect to any generation, treatment, storage, recycling,
transportation, release or disposal, or any release as defined in 42
U.S.C. ss. 9601(22), of any substance regulated under Environmental
Laws ("Hazardous Materials") generated by Windsor Arbor.
Windsor Arbor has not handled any Hazardous Material, other
than such as would be customary in the normal course of operating
multi-family apartment complexes, on any property now or previously
owned or leased by it.
No polychlorinated biphenyls are or have been present at the
Windsor Project.
No asbestos is or has been present at the Windsor Project.
There are no underground storage tanks for Hazardous
Materials, active or abandoned, at the Windsor Project.
No Hazardous Materials have been released and continue to
affect the subject property, in a reportable quantity, where such a
quantity has been established by statute, ordinance, rule, regulation
or order.
No Hazardous Materials have been otherwise released at, on or
under the Windsor Project.
Windsor Arbor has not transported or arranged for the
transportation of any Hazardous Material to any location which is
listed on the National Priorities List under the
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Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended ("CERCLA"), listed for possible inclusion on the
National Priorities List by the Environmental Protection Agency in
CERCLIS or on any similar state list or which is the subject of
federal, state or local enforcement actions or other investigations
which may reasonably be expected to lead to claims against Windsor
Arbor for clean-up costs, remedial work, damages to natural resources
or for personal injury claims, including claims under CERCLA.
No notification of a release of a Hazardous Material has been
filed by or on behalf of Windsor Arbor and the Windsor Project is not
listed or proposed for listing on the National Priority List
promulgated pursuant to CERCLA, on CERCLIS or on any similar state list
of sites requiring investigation or clean-up.
There are no liens arising under or pursuant to any
Environmental Laws on the Windsor Project, and no government actions
have been taken or are in process which could subject the Windsor
Project to such liens and Windsor Arbor is not required to place any
notice or restriction relating to the presence of Hazardous Materials
at the Windsor Project.
There have been no environmental investigations, studies,
audits, tests, reviews or other analyses conducted by or which are in
the possession of Windsor Arbor in relation to the Windsor Project
which have not been made available to GPT-Windsor.
(j) Title. Windsor Arbor is the sole beneficial owner of, and has
good and marketable title to, the Windsor Project, free and clear of
all Title Defects.
(k) Financing Arrangements. Except as described in Schedule E
attached hereto, Windsor Arbor is not obligated for any material
indebtedness.
(l) Employees. Windsor Arbor has complied in all material
respects with all laws relating to the employment of labor, including any
provisions thereof relating to wages, hours, collective bargaining and the
payment of social security and similar taxes (in each case except where any
statute of limitations applicable to non-compliance has expired without any
claim having been made with respect to such non-compliance), and is not liable
for any arrearage of wages, taxes or penalties for failure to comply with any of
the foregoing.
(m) Solvency. None of the transactions contemplated by this
Agreement will be or have been made with an actual intent to hinder, delay or
defraud any present or future creditors of the Windsor Contributors, and the
Windsor Contributors are not and will not be rendered insolvent by such
transactions or will have received fair and reasonably equivalent value in good
faith for the contribution and sale of assets pursuant to this Agreement. The
Windsor Contributors are able to pay their debts as they become due, including
contingent obligations reasonably likely to become due.
(n) Delinquent Property Liens. Except for claims which are not
material in amount or which are expressly permitted to exist under this
Agreement or which otherwise constitute Permitted Exceptions, there is no
delinquent tax, sewer rent, water charge, assessment or other outstanding
charges against the Windsor Project. Except as shown in the title policy, there
are no mechanics' liens or similar Title Defects or, to the Windsor
Contributors' knowledge, claims for overdue payment for work performed by or on
behalf of Windsor Project, labor or material affecting the Windsor Project and
there are no mechanics' liens or similar Title Defects or claims affecting the
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Windsor Project which have not been insured or endorsed over by the Title
Company issuing the Title Policies.
(o) Insurance. The Windsor Project is covered by insurance of the
type and in the amounts set forth on Schedule F.
(p) Improvements. Except as disclosed in the Surveys or Title
Commitments, all the Windsor Improvements lie wholly within the boundary and
building restriction lines of the Windsor Real Estate and no improvements on
adjoining properties encroach upon the Windsor Real Estate in any respect.
(q) Casualty; Condemnation. The Windsor Project is free of
material damage and waste and there is no proceeding pending or, to the best of
the Windsor Contributors' knowledge, threatened, for the total or partial taking
of the Windsor Project, and there has not occurred with respect to the Windsor
Project any (i) damage or destruction which would cost more than $100,000 to
repair, (b) any taking by condemnation or eminent domain or other similar
proceeding involving loss in excess of $100,000 or (c) any taking by
condemnation or eminent domain or other similar proceeding of all or
substantially all thereof (other than for temporary use).
(r) Zoning and Other Laws. To the Windsor Contributors'
knowledge, the Windsor Project and the use and operation thereof, separate and
apart from any other properties, constitute a legal use under applicable zoning
regulations and comply in all material respects with all applicable requirements
of law and all applicable insurance requirements, and, except as provided in any
engineering reports furnished to the Operating Partnership prior to the date
hereof, comply in all material respects with the applicable provisions of the
Americans with Disabilities Act and the Fair Housing Amendments Act of 1988 and
all applicable regulations issued thereunder and each similar applicable state
law and regulation.
(s) Service Contracts. Each Service Contract relating to the
Windsor Project has been entered into in the normal course of business in an
arm's-length transaction and is on terms and conditions customary for
multi-family apartment complexes. Each such Service Contract is in full force
and effect and neither Windsor Arbor nor, to the Windsor Contributors'
knowledge, any other party to any thereof is in default thereunder.
(t) Permits. Except for permits relating to Hazardous
Materials (which are provided for in Section 4.1(i)), there have been issued in
respect of the Windsor Project all permits and governmental approvals necessary
or required to own, operate, use and occupy the Windsor Project in the manner
currently operated. Each such permit is in full force and effect and Windsor
Arbor has not received any notice of violation or revocation thereof. No other
permits are required from any governmental entity in order to operate the
Windsor Project as it is now operated.
(u) Utilities. Windsor Arbor has not received any notice of
actual or threatened reduction or curtailment of any utility service
now supplied to the Windsor Project.
(v) Certificates of Occupancy. Windsor Arbor has not received
any notice of actual or threatened cancellation or suspension of the certificate
of occupancy for any portion of the Windsor Project and each such certificate of
occupancy is in full force and effect.
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(w) Assessments. Windsor Arbor has not received any notice of
actual or threatened special assessments or special reassessments of
the Windsor Project.
(x) Activities of Property Partnerships. The sole activity of
Windsor Arbor is (i) the ownership of the Windsor Project, (ii) the operation,
leasing, financing and management of the Windsor Project, (iii) the buying of
additional condominium units at the Windsor Arbor Condominium and (iv)
activities incidental to such ownership, operation, leasing, financing and
management.
(y) Property Partnership Agreements. The Windsor Contributors
have delivered to the Operating Partnership true and correct copies of the
partnership agreements with respect to Windsor Arbor, including all
modifications, amendments or supplements thereto. All such partnership
agreements are in full force and effect in accordance with their respective
terms.
(z) Title to Contributed Interests. Subject to the provisions
of the partnership agreement of Windsor Arbor, the Windsor Contributors are the
owners of the Windsor Interests set forth opposite their respective names on
Schedule A free and clear of all security interests, liens or other
encumbrances.
(aa) Accredited Investor; Acquisition for Investment Purposes.
Each Windsor Contributor and each direct and indirect owner of such Windsor
Contributor is an "accredited investor" as defined in Rule 501 of the General
Rules and Regulations promulgated under the Securities Act of 1933, as amended
(the "Securities Act"). Each of the Windsor Contributors is acquiring the Units
solely for its own account for the purpose of investment and not as a nominee or
agent for any other Person and not with a view to, or for offer or sale in
connection with, any distribution of any Units (other than in a transaction
which is either registered under the Securities Act or exempt from such
registration, and in compliance with all applicable Blue Sky or state securities
laws or exempt therefrom). Each Windsor Contributor agrees and acknowledges that
it will not, directly or indirectly, offer, transfer, sell, assign, pledge,
hypothecate or otherwise dispose of (hereinafter, "Transfer") any of the Units
unless such Transfer complies with the Operating Partnership Agreement and is
either (i) pursuant to an effective registration statement under the Securities
Act and qualification or other compliance under applicable Blue Sky or state
securities laws, or (ii) exempt from registration under the Securities Act and
qualification or other compliance under applicable Blue Sky or state securities
laws.
4.2 Representations and Warranties of Northeast and West Hartford
Center. To induce the Operating Partnership to execute, deliver and perform this
Agreement, each of Northeast and West Hartford represents and warrants,
severally (and not jointly), to the Operating Partnership with respect to itself
and its respective Partnership Project on and as of the date hereof as follows:
(a) Existence. It (i) is duly organized and validly existing
under the laws of the state of its organization; (ii) has all requisite power,
and has all material governmental licenses, authorizations, consents and
approvals necessary to own its assets and carry on its business as now being or
as proposed to be conducted; and (iii) is qualified to do business in all
jurisdictions in which the nature of the business conducted by it makes such
qualification necessary, except where the failure to be so qualified would not
have a Material Adverse Effect on itself.
(b) Authorization, Execution, Etc.. It has all necessary power
and authority to execute, deliver and perform its obligations under
this Agreement; the execution, delivery and performance by it of this
Agreement have been duly authorized by all necessary action on its
part; and
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this Agreement has been duly and validly executed and delivered by it and
constitutes its legal, valid and binding obligation, enforceable in accordance
with its terms, subject to bankruptcy, insolvency, moratorium or other similar
laws affecting the enforcement of creditors' rights in general and to general
principles of equity.
(c) No Breach. None of the execution and delivery of this
Agreement, the consummation of the transactions contemplated hereby and
compliance with the terms and provisions hereof by it will conflict with or
result in a breach of, or require any consent (except such consents as have been
obtained) under (i) its organizational documents, (ii) any material applicable
law or regulation, or any order, writ, injunction or decree of any court or
governmental authority or agency, or (iii) any material agreement or instrument
to which it is a party or by which it is bound or to which it is subject, or
constitute a default under any such agreement or instrument, or result in the
creation or imposition of any lien upon any of its revenues or assets pursuant
to the terms of any such agreement or instrument.
(d) Litigation. There are no legal or arbitral proceedings or
any proceedings by or before any governmental or regulatory authority or agency,
now pending or, to its knowledge, threatened against it, except for such
proceedings which, if decidedly adversely to such Person would not have a
Material Adverse Effect on it.
(e) Approvals. It has obtained all material authorizations,
approvals or consents of, and have made all material filings or registrations
with, any governmental or regulatory authority or agency that are necessary for
the execution, delivery or performance by it of this Agreement or for the
validity or enforceability thereof.
(f) Rent Roll. Schedule C hereto is a true and correct list of
the rent rolls for their respective Partnership Projects as of May 31, 1997. The
rent rolls are true and correct rent rolls for their respective Partnership
Projects, showing, for each apartment unit the following information: (i)
whether the unit is occupied and, if occupied, (ii) the name(s) of the
tenant(s), (iii) the amount of rent, (iv) the amount of any security deposit and
(v) the starting and termination date of the lease term.
(g) Parties In Possession. Except as shown on the rent rolls
listed on Schedule C, no Person is in possession of their respective
Partnership Projects or any portion thereof, and no other Person has
any interest in their respective Partnership Projects.
(h) Leases. A correct and complete copy of each Partnership
Lease (including all amendments thereto) with respect to their respective
Partnership Project has been provided to the applicable New Partnership and each
such Partnership Lease is unmodified (except for such amendments) and in full
force and effect and neither it nor, to its knowledge, any other party to any
thereof is in default thereunder, other than rental delinquencies in the normal
course of business.
(i) Hazardous Materials. To its knowledge, except as disclosed
in Schedule D hereto or in any environmental reports or audits furnished to the
Operating Partnership prior to the date hereof, it has obtained all permits,
licenses and other authorizations which it is required to obtain under all
Environmental Laws, and it is in compliance with the terms and conditions of all
such permits, licenses and authorizations, and is also in compliance in all
material respects with all other limitations, restrictions, conditions,
standards, prohibitions, requirements, obligations, schedules and timetables
contained in any applicable Environmental Law or in any regulation, code, plan,
order,
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decree, judgment, injunction, notice or demand letter issued, entered,
promulgated or approved thereunder.
In addition, to its knowledge, except as disclosed in Schedule
D hereto or in any environmental reports or audits furnished to the Operating
Partnership prior to the date hereof:
No notice, notification, demand, request for information,
citation, summons or order has been issued, no complaint has been
filed, no penalty has been assessed and no investigation or review is
pending or threatened, by any governmental or other entity with respect
to any alleged failure by it to have any permit, license or
authorization required in connection with the conduct of its business
with respect to any generation, treatment, storage, recycling,
transportation, release or disposal, or any release as defined in 42
U.S.C. ss. 9601(22), of any substance regulated under Environmental
Laws ("Hazardous Materials") generated by it.
It has not handled any Hazardous Material, other than such as
would be customary in the normal course of operating multi-family
apartment complexes, on any property now or previously owned or leased
by it.
No polychlorinated biphenyls are or have been present at its
respective Partnership Project.
No asbestos is or has been present at its respective
Partnership Project.
There are no underground storage tanks for Hazardous
Materials, active or abandoned, at its respective Partnership Project.
No Hazardous Materials have been released and continue to
affect the subject property, in a reportable quantity, where such a
quantity has been established by statute, ordinance, rule, regulation
or order.
No Hazardous Materials have been otherwise released at, on or
under its respective Partnership Project.
It has not transported or arranged for the transportation of
any Hazardous Material to any location which is listed on the National
Priorities List under the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended ("CERCLA"), listed
for possible inclusion on the National Priorities List by the
Environmental Protection Agency in CERCLIS or on any similar state list
or which is the subject of federal, state or local enforcement actions
or other investigations which may reasonably be expected to lead to
claims against it for clean-up costs, remedial work, damages to natural
resources or for personal injury claims, including claims under CERCLA.
No notification of a release of a Hazardous Material has been
filed by or on behalf of it and its respective Partnership Project is
not listed or proposed for listing on the National Priority List
promulgated pursuant to CERCLA, on CERCLIS or on any similar state list
of sites requiring investigation or clean-up.
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There are no liens arising under or pursuant to any
Environmental Laws on its respective Partnership Project, and no
government actions have been taken or are in process which could
subject its respective Partnership Project to such liens and it is not
required to place any notice or restriction relating to the presence of
Hazardous Materials at its respective Partnership Project.
There have been no environmental investigations, studies,
audits, tests, reviews or other analyses conducted by or which are in
the possession of it in relation to its respective Partnership Project
which have not been made available to the applicable New Partnership.
(j) Title. It is the sole beneficial owner of, and has good and
marketable title to, its respective Partnership Project, free and
clear of all Title Defects.
(k) Financing Arrangements. Except as described in Schedule E
attached hereto, it is not obligated for any material indebtedness.
(l) Employees. It has complied in all material respects with
all laws relating to the employment of labor, including any provisions thereof
relating to wages, hours, collective bargaining and the payment of social
security and similar taxes (in each case except where any statute of limitations
applicable to non-compliance has expired without any claim having been made with
respect to such non-compliance), and is not liable for any arrearage of wages,
taxes or penalties for failure to comply with any of the foregoing.
(m) Solvency. None of the transactions contemplated by this
Agreement will be or have been made with an actual intent to hinder, delay or
defraud any present or future creditors of it, and it is not and will not be
rendered insolvent by such transactions or will have received fair and
reasonably equivalent value in good faith for the contribution and sale of
assets pursuant to this Agreement. It is able to pay their debts as they become
due, including contingent obligations reasonably likely to become due.
(n) Delinquent Property Liens. Except for claims which are not
material in amount or which are expressly permitted to exist under this
Agreement or which otherwise constitute Permitted Exceptions, there is no
delinquent tax, sewer rent, water charge, assessment or other outstanding
charges against its respective Partnership Project. Except as shown in the title
policy, there are no mechanics' liens or similar Title Defects or, to its
knowledge, claims for overdue payment for work performed by or on behalf of its
respective Partnership Project, labor or material affecting its respective
Partnership Project and there are no mechanics' liens or similar Title Defects
or claims affecting its respective Partnership Project which have not been
insured or endorsed over by the Title Company issuing the Title Policies.
(o) Insurance. Its respective Partnership Project is covered by
insurance of the type and in the amounts set forth on Schedule F.
(p) Improvements. Except as disclosed in the Surveys or Title
Commitments, all its respective Partnership Improvements lie wholly within the
boundary and building restriction lines of its respective Partnership Real
Estate and no improvements on adjoining properties encroach upon its respective
Partnership Real Estate in any respect.
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(q) Casualty; Condemnation. Its respective Partnership Project
is free of material damage and waste and there is no proceeding pending or, to
the best of its knowledge, threatened, for the total or partial taking of its
respective Partnership Project, and there has not occurred with respect to its
respective Partnership Project any (i) damage or destruction which would cost
more than $100,000 to repair, (b) any taking by condemnation or eminent domain
or other similar proceeding involving loss in excess of $100,000 or (c) any
taking by condemnation or eminent domain or other similar proceeding of all or
substantially all thereof (other than for temporary use).
(r) Zoning and Other Laws. To its knowledge, its respective
Partnership Project and the use and operation thereof, separate and apart from
any other properties, constitute a legal use under applicable zoning regulations
and comply in all material respects with all applicable requirements of law and
all applicable insurance requirements, and, except as provided in any
engineering reports furnished to the Operating Partnership prior to the date
hereof, comply in all material respects with the applicable provisions of the
Americans with Disabilities Act and the Fair Housing Amendments Act of 1988 and
all applicable regulations issued thereunder and each similar applicable state
law and regulation.
(s) Service Contracts. Each Service Contract relating to its
respective Partnership Project has been entered into in the normal course of
business in an arm's-length transaction and is on terms and conditions customary
for multi-family apartment complexes. Each such Service Contract is in full
force and effect and neither it nor, to its knowledge, any other party to any
thereof is in default thereunder.
(t) Permits. Except for permits relating to Hazardous
Materials (which are provided for in Section 4.1(i)), there have been issued in
respect of its respective Partnership Project all permits and governmental
approvals necessary or required to own, operate, use and occupy its respective
Partnership Project in the manner currently operated. Each such permit is in
full force and effect and it has not received any notice of violation or
revocation thereof. No other permits are required from any governmental entity
in order to operate its respective Partnership Project as it is now operated.
(u) Utilities. It has not received any notice of actual or
threatened reduction or curtailment of any utility service now
supplied to its respective Partnership Project.
(v) Certificates of Occupancy. It has not received any notice
of actual or threatened cancellation or suspension of the certificate of
occupancy for any portion of its respective Partnership Project and each such
certificate of occupancy is in full force and effect.
(w) Assessments. It has not received any notice of actual or
threatened special assessments or special reassessments of its
respective Partnership Project.
(x) Activities of Property Partnerships. Its sole activity is
(i) the ownership of its respective Partnership Project, (ii) the operation,
leasing, financing and management of its respective Partnership Project and
(iii) activities incidental to such ownership, operation, leasing, financing and
management.
(y) Property Partnership Agreements. It has delivered to the
Operating Partnership true and correct copies of the partnership
agreements with respect to itself, including all modifications,
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amendments or supplements thereto. All such partnership agreements are in full
force and effect in accordance with their respective terms.
(z) Accredited Investor; Acquisition for Investment Purposes.
It and each direct and indirect owner of it is an "accredited investor" as
defined in Rule 501 of the General Rules and Regulations promulgated under the
Securities Act. It is acquiring the Units solely for its own account for the
purpose of investment and not as a nominee or agent for any other Person other
than owners of it, and not with a view to, or for offer or sale in connection
with, any distribution of any Units (other than in a transaction which is either
registered under the Securities Act or exempt from such registration, and in
compliance with all applicable Blue Sky or state securities laws or exempt
therefrom). It agrees and acknowledges that it will not, directly or indirectly,
offer, transfer, sell, assign, pledge, hypothecate or otherwise dispose of
(hereinafter, "Transfer") any of the Units unless such Transfer complies with
the Operating Partnership Agreement and is either (i) pursuant to an effective
registration statement under the Securities Act and qualification or other
compliance under applicable Blue Sky or state securities laws, or (ii) exempt
from registration under the Securities Act and qualification or other compliance
under applicable Blue Sky or state securities laws.
4.3 Representations and Warranties of the Operating Partnership. To
induce the Contributors to execute, deliver and perform this Agreement, the
Operating Partnership represents and warrants to the Contributors on and as of
the date hereof as follows:
(a) Existence. The Operating Partnership: (i) is a limited
partnership duly organized and validly existing under the laws of the State of
Delaware; (ii) has all requisite power, and has all material governmental
licenses, authorizations, consents and approvals necessary to own its assets and
carry on its business as now being or as proposed to be conducted; and (iii) is
qualified to do business in all jurisdictions in which the nature of the
business conducted by it makes such qualification necessary, except where the
failure to be so qualified would not have a Material Adverse Effect on the
Operating Partnership.
(b) Authorization, Execution, Etc.. The Operating Partnership
has all necessary power and authority to execute, deliver and perform its
obligations under this Agreement; the execution, delivery and performance by the
Operating Partnership of this Agreement have been duly authorized by all
necessary action on its part; and this Agreement has been duly and validly
executed and delivered by the Operating Partnership and constitutes its legal,
valid and binding obligation, enforceable in accordance with its terms, subject
to bankruptcy, insolvency, moratorium or other similar laws affecting the
enforcement of creditors' rights in general and to general principles of equity.
(c) No Breach. None of the execution and delivery of this
Agreement, the consummation of the transactions contemplated hereby and
compliance with the terms and provisions hereof will conflict with or result in
a breach of, or require any consent (except such consents as have been obtained)
under (i) the organizational documents of the Operating Partnership, (ii) any
material applicable law or regulation, or any order, writ, injunction or decree
of any court or governmental authority or agency, or (iii) any agreement or
instrument to which the Operating Partnership is a party or by which it is bound
or to which it is subject, or constitute a default under any such agreement or
instrument, or result in the creation or imposition of any lien upon any of the
revenues or assets of the Operating Partnership pursuant to the terms of any
such agreement or instrument.
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(d) Approvals. The Operating Partnership has obtained all
material authorizations, approvals or consents of, and has made all material
filings or registrations with, any governmental or regulatory authority or
agency that are necessary for the execution, delivery or performance by the
Operating Partnership of this Agreement or for the validity or enforceability
thereof.
(e) Units; Common Shares. The Units, when issued to the
Contributors, will not be subject to any lien, claim, encumbrance, restriction
upon voting right, preemption right or other claim of any third party, other
than pursuant to federal or state securities laws or the Operating Partnership
Agreement. The Units, when issued to the Contributors, will be duly and validly
issued partnership units in the Operating Partnership. Any shares of common
stock of Grove Property Trust, a Maryland real estate investment trust, which
may be issued in redemption of Units will, when issued, be duly and validly
issued, fully paid, non-assessable and shall not be subject to any preemptive or
similar rights.
(f) Securities Act Compliance. Assuming the truth and accuracy of
the representations and warranties in Sections 4.1(aa), and 4.2(z)
hereof, the issuance of Units to the Contributors pursuant to this
Agreement is exempt from the registration requirements of the
Securities Act.
4.4 Survival of Representations and Warranties. The representations and
warranties of the parties contained in this Article 4 shall survive the Closing;
provided, that any claim for breach by the Contributors of any Property-Related
Representation and Warranty must be asserted within one (1) year of discovery by
the party asserting same, and in any event within two (2) years after the
Closing Date.
ARTICLE 5.
CLOSING MATTERS
5.1 Closing. The closing of the transactions contemplated hereby (the
"Closing") shall take place at the place and on the date (the "Closing Date")
mutually agreed to by the parties hereto. As of the Closing Date, the Title
Company shall be willing to approve and insure title to the Real Estate, subject
only to the Permitted Exceptions, at regular premium rates, under its ALTA Form
Owner's Policy.
5.2 New York Style Closing. The transactions contemplated hereby shall
be closed by means of a so-called "New York Style Closing," with the concurrent
delivery of the documents of title, transfers of interests, delivery of the
Title Policies and transfer of the Units and all other consideration to be paid
to the Contributors pursuant to this Agreement. The Contributors shall provide
any undertaking to the Title Company necessary for the New York Style Closing to
occur or for the satisfaction of any other requirement for Closing.
5.3 Surveys, Title Commitments and Searches. At or prior to the
Closing, the Contributors shall deliver to GPT-Windsor or the
applicable New Partnership, as the case may be, the following:
(a) Surveys. A plat of Survey of each Partnership Project
prepared by a surveyor licensed by the state in which such Partnership Project
is located in conformity with such standards as are required by the Operating
Partnership and the Title Company.
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(b) Title Commitments. A Title Commitment for each Partnership
Project for an ALTA Form Owner's Policy issued by the Title Company showing
title to the Real Estate in the applicable Owner, subject only to the Permitted
Exceptions, which Title Commitments shall include such endorsements as may be
reasonably requested by the Operating Partnership.
(c) Searches. UCC, judgment and tax lien searches on the names
of the Contributors and the Owners (the "Searches") showing no Title Defect as
to the Partnership Projects unless the same is to be paid and released at or
prior to Closing.
ARTICLE 6.
CLOSING DELIVERIES
6.1 The Contributors' Deliveries. At the Closing, the Contributors
shall deliver to the Operating Partnership, GPT-Windsor, and the New
Partnerships, as the case may be, the following, all in form and substance
reasonably satisfactory to the Operating Partnership, GPT-Windsor, and the New
Partnerships, as the case may be:
(a) assignments, duly executed and acknowledged by each
Windsor Contributor, conveying to GPT-Windsor, free and clear of all liens,
encumbrances, claims and security interests, of such Windsor Contributor's
interests in Windsor Arbor, as set forth on Schedule A;
(b) deeds for the Northeast Real Estate and the West Hartford
Center Real Estate, which shall be in recordable form and shall be the form of
deeds customarily used in Connecticut and Massachusetts, as the case may be, for
properties similar to the Partnership Projects, duly executed and acknowledged
by the respective Contributor, conveying to the applicable New Partnerships,
good, marketable and indefeasible fee simple title to the applicable Partnership
Real Estate, Partnership Improvements and any fixtures located thereon, in
proper form for recording and subject only to the Permitted Exceptions;
(c) general warranty bills of sale, duly executed and
acknowledged by the applicable Contributor, conveying to the applicable New
Partnership title to the applicable Partnership Personalty of each Contributor,
free and clear of all liens, encumbrances, claims and security interests, with
express warranties of good title;
(d) assignments, duly executed and acknowledged by the
applicable Contributor, conveying title to the applicable New Partnership, free
and clear of all liens, encumbrances, claims and security interests, to (i) the
Partnership Intangible Property of such Contributor; (ii) each Partnership Lease
and each Service Contract relating to such Contributor Partnership Projects;
(iii) any security deposits, prepaid rents or other monies, if any, held with
respect to the applicable Partnership Projects, along with an accounting of any
such security deposits, prepaid rents or other monies;
(e) an original executed copy of the Partnership Leases and
Service Contracts of the applicable Partnership Projects that are
assigned to the applicable New Partnerships;
(f) a certification by Northeast and West Hartford Center
stating such Contributor's U.S. Taxpayer identification number and that such
Contributor is not a "foreign person" or a "foreign corporation" (as defined
under Internal Revenue Code Section 1445 and Section 7701);
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(g) any state, county and city documentary stamp declarations
or transfer tax forms required to be signed by any Contributor or in connection
with the conveyance of Partnership Projects, duly executed by the applicable
Contributor, as necessary or customary in the jurisdiction in which such
Partnership Project is located;
(h) all such further instruments and documents as may be
necessary, expedient, proper, or appropriate in the reasonable opinion of the
Operating Partnership, in order to complete the transactions contemplated
hereby.
6.2 The Operating Partnership's Deliveries. At the Closing, the
Operating Partnership shall deliver to the Contributors the following,
all in form and substance reasonably satisfactory to the Contributors:
(a) the Units in accordance with Section 3.1 hereof;
(b) countersigned copies of any documents listed in Section 6.1
hereof which are required to be signed by the Operating Partnership,
GPT-Windsor or the New Partnership; and
6.3 New Partnership and GPT-Windsor Deliveries. At the Closing,
the Operating Partnership shall cause:
(a) each of the New Partnerships to deliver to the
Contributors the following, all in form and substance reasonably satisfactory to
the Contributors any state, county and city documentary stamp declarations or
transfer tax forms required to be signed by the applicable New Partnership or in
connection with the conveyance of each of the Northeast and West Hartford Center
Projects, duly executed by the applicable New Partnership, as necessary or
customary in the jurisdiction in which each such Partnership Project is located;
and
(b) GPT-Windsor to execute and deliver the Windsor Amendment and
to fund its funding obligations thereunder.
6.4 Concurrent Transactions. All documents or other deliveries required
to be made pursuant to this Agreement at or prior to Closing shall be deemed to
have been delivered and to have been consummated simultaneously with all other
transactions and all other deliveries, and no delivery shall be deemed to have
been made, and no transaction shall be deemed to have been consummated, until
all deliveries required by all the parties hereto shall have been made.
6.5 Further Assurances. The parties hereto, at the Closing, or at any
time or from time to time thereafter, upon request of either party, will execute
such additional instruments, documents or certificates as any other party deems
reasonably necessary in order to effect the transactions contemplated hereby.
6.6 Possession. Possession of the Northeast and West Hartford
Center Projects shall be delivered to the applicable New Partnership
at Closing.
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ARTICLE 7.
APPORTIONMENTS; SECURITY DEPOSITS
7.1 Apportionments for Northeast and West Hartford Center Projects.
Adjustments in respect of the Northeast and West Hartford Center Projects shall
be made between the applicable Contributors and the applicable New Partnerships
for the following items, pro-rated on a per diem basis, as of midnight of the
day preceding the Closing Date:
(a) Rents and other charges paid under each lease relating to
the applicable Partnership Projects, or any portion thereof.
(b) Real estate, personal property and ad valorem taxes and
other state or city taxes, charges and assessments affecting the Partnership
Projects, or any portion thereof, not yet due and payable, shall be prorated on
the basis of the most recent fiscal year for which the same are levied or
assessed; provided, that if the amount of any such taxes, charges or assessments
shall not be fixed or ascertainable before the Closing Date, the proration
thereof on the date of the Closing shall be upon the basis of the most recent
ascertainable amount of such taxes, charges and assessments in which event,
there shall be a re-proration of such tax, charge or assessment immediately upon
receipt of the actual bill therefor, and, within ten (10) days of the receipt of
such bill, the applicable Contributors shall pay the applicable New Partnership
or the applicable New Partnership shall pay the applicable Contributors, as the
case may be, any amount due the other party as a result of such re-proration.
(c) Charges for water, electricity, sewer rental, gas,
telephone and other utilities for the Partnership Projects (normally billed to
the Contributors, not to tenants) will be paid by the applicable Contributors on
a per diem basis on the basis of readings or the most recent available bills
(subject to readjustment on receipt of bills covering the period in which the
Closing occurs). To the extent deposits held on behalf of the Property
Partnerships by utility companies are transferable to the applicable New
Partnerships, the applicable Contributors shall receive a credit at Closing in
the amount of such deposits and such deposits shall be transferred and placed in
the name of the applicable New Partnerships. Otherwise, the applicable
Contributors shall receive a refund of such deposits and the applicable New
Partnerships shall have no claim with regard to the same.
(d) Charges under existing Service Contracts assigned to the
New Partnerships, if any, and other ordinary costs and expenses for maintenance
and protection of the Partnership Project for which payment has been made or is
due for the periods prior to and after Closing.
(e) Such additional adjustments as are normally made in
connection with the sale of property similar to the Partnership Projects in the
county and state where the Partnership Projects are located.
7.2 Apportionments for Windsor Arbor. Adjustments in respect of
the partnership interests in Windsor Arbor shall be made between the
Windsor Contributors and GPT-Windsor as follows, as of midnight of the
day preceding the Closing Date:
(a) The Windsor Contributors and the other partners in Windsor
Arbor (collectively, the "Existing Partners") shall be entitled to all revenues
of Windsor Arbor from all sources, including, without limitation, from the
proceeds of operations, leasing and financing (collectively, "Revenues") payable
or accruing to Windsor Arbor through the Closing Date (whether or
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not actually received prior to the Closing Date). Windsor Arbor shall be
entitled to all Revenues accruing to Windsor Arbor on and after the Closing Date
(whether or not actually received on or after the Closing Date).
(b) The Existing Partners shall bear all expenses, obligations
and liabilities of Windsor Arbor accruing through the Closing Date. Expenses,
obligations and liabilities of Windsor Arbor accruing on or after the Closing
Date, shall be the responsibility of Windsor Arbor after the Closing Date.
(c) Subject to the contrary provisions of its partnership
agreement, all income, gains, losses, deductions and credits of Windsor Arbor
accruing prior to the Closing Date shall be allocated to its Existing Partners.
After the Closing Date, the respective shares of the partners in Windsor Arbor
in the revenues, distributions, expenses, income, gains, losses, deductions and
credits of Windsor Arbor shall be in accordance with its partnership agreement.
7.3 Security Deposits. At the Closing, Northeast and West Hartford
Center shall pay to the applicable New Partnerships, in cash (or by credit
against apportionments owing in favor of the applicable Contributors), the
aggregate amount of any security deposits which the Partnership Leases at the
Partnership Projects provide have been delivered by tenants, together with all
interest on such security deposits which is due to any tenant under the
provisions of any lease or applicable law.
ARTICLE 8.
INDEMNITIES
8.1 The Contributors' Indemnity.
(a) Contributors. Subject to the limitations on liability set
forth in Section 8.4 and 8.5 hereof, each Contributor agrees severally (and not
jointly) to indemnify, defend (with counsel mutually acceptable to the Operating
Partnership and such Contributor) and hold the Operating Partnership harmless
from and against any Damages to the Operating Partnership resulting from any
inaccuracy in or breach of any representation or warranty of such Contributor
any breach or default by such Contributor of any Obligation of such Contributor
under this Agreement.
8.2 The Operating Partnership's Indemnity. Subject to the limitation on
liability set forth in Section 8.4 hereof, the Operating Partnership agrees to
indemnify, defend (with counsel mutually acceptable to the Operating Partnership
and the applicable Contributors) and hold the Contributors harmless from and
against any Damages to the Contributors resulting from any inaccuracy in or
breach of any representation or warranty of the Operating Partnership or
resulting from any breach or default by the Operating Partnership of any
Obligation of the Operating Partnership under this Agreement.
8.3 Notice of Claims. Each Contributor and the Operating Partnership,
as applicable, shall promptly notify the other in the event any claim is made
against it as to which the other party has agreed to indemnify and the
indemnitor shall thereupon undertake to defend and hold the indemnitee harmless
therefrom.
8.4 Limitation on Liability.
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(a) The Contributors shall look solely to the assets of the
Operating Partnership for satisfaction of any liability of the Operating
Partnership in respect of this Agreement and all documents, agreements,
understandings and arrangements relating to this transaction and will not seek
recourse or commence any action against any of the partners, officers,
directors, shareholders or employees of the Operating Partnership.
(b) The Operating Partnership shall look solely to the
applicable Contributors' Units issued to such Contributor pursuant to this
Agreement (together with any securities issuable with respect to such Units) for
satisfaction of any liability of the Contributors in respect of this Agreement
and all documents, agreements, understandings and arrangements relating to this
transaction and will not seek recourse or commence any action against any of the
Contributors or the partners, officers, directors, shareholders or employees of
the Contributors and its partners.
8.5 Limitations on Indemnification Obligations.
(a) Each Contributor shall not have any liability under this
Agreement for Damages resulting from any inaccuracy in or breach of any
Property-Related Representation and Warranty unless the aggregate of all Damages
for which such Contributor would, but for this sentence, be liable exceeds
$50,000 on a cumulative basis, and then such Contributor shall be liable only
for amounts exceeding such amount.
(b) Claims for indemnification for any Damages resulting from
a breach of any Property-Related Representation and Warranty shall not be
brought or made after one year from discovery of such breach or, in any event,
after two years from the date of the Closing; provided that such time limitation
shall not apply to any item as to which the party to be indemnified shall have,
before the expiration of such period, previously made a claim by delivering a
notice (stating, in reasonable detail, the basis of such claim) to the
indemnifying party.
ARTICLE 9.
MISCELLANEOUS
9.1 Expenses. The Operating Partnership shall be responsible for all
costs incurred by the Contributors and the Operating Partnership directly or
indirectly relating to the transactions contemplated hereby (collectively, the
"Expenses"), including all sales, use, recording and transfer taxes, all costs
of the Surveys, all title insurance premiums and charges for the issuance of the
Title Policies, including the charges for title endorsements, the charges for
the New York Style Closing, all testing and inspection costs, and all legal,
accounting, consulting and engineering fees. The Operating Partnership shall
reimburse the Contributors for all of the Expenses paid or payable by the
Contributors.
9.2 Brokerage. The Contributors and the Operating Partnership each
hereby represent and warrant to the other that neither has dealt with any broker
or finder in connection with the transactions contemplated hereby, and each
hereby agrees to indemnify, defend and hold the other harmless of and from any
and all manner of claims, liabilities, loss, damage, attorneys' fees and
expenses, incurred by either party and arising out of, or resulting from, any
claim by any such broker or finder in contravention of its representation and
warranty herein contained.
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9.3 Survival. Except as expressly provided or limited to the contrary
herein or in any instrument delivered pursuant hereto, the representations,
warranties, obligations, covenants, agreements, undertakings and
indemnifications of the parties contained herein or in any instrument required
to be delivered pursuant hereto shall survive the Closing.
9.4 Construction. This Agreement shall not be construed more strictly
against one party than against the other merely by virtue of the fact that it
may have been prepared primarily by counsel for one of the parties, it being
recognized that both the Operating Partnership and the Contributors have
contributed substantially and materially to the preparation of this Agreement.
9.5 General. This Agreement may be executed in any number of
counterparts, each of which shall constitute an original but all of which, taken
together, shall constitute but one and the same instrument. This Agreement
(including all Schedules hereto) contains the entire agreement between the
parties with respect to the subject matter hereof, supersedes all prior
understandings, if any, with respect thereto and may not be amended,
supplemented or terminated except by written agreement between the parties
hereto, nor shall any Obligation hereunder or condition hereof be deemed waived,
except by a written instrument to such effect signed by the party to be charged.
The warranties, representations, agreements and undertakings contained herein
shall not be deemed to have been made for the benefit of any Person, other than
the parties hereto and their permitted successors and assigns.
9.6 Headings. The headings preceding the text of the paragraphs and
subparagraphs hereof are inserted solely for convenience of reference and shall
not constitute a part of this Agreement, nor shall they affect its meaning,
construction or effect.
9.7 Governing Law; Parties at Interest. This Agreement will be governed
by the law of the State of Connecticut, and will bind and inure to the benefit
of the parties hereto and their respective heirs, executors, administrators,
successors, assigns and personal representatives.
9.8 Power of Attorney. Each Contributor does hereby make, constitute
and appoint Brian Navarro, Damon Navarro, Edmund Navarro and Joseph LaBrosse,
and each of them, its true and lawful attorney-in-fact, with full power of
substitution and resubstitution, to negotiate, execute and deliver any and all
other documents which such attorney deems necessary or desirable in order to
consummate the transactions contemplated hereby in accordance with this
Agreement. Such attorney (and any substitute named by such attorney) shall have
full power and authority to do and perform in the name and on behalf of such
Contributor in any and all capacities, every act whatsoever necessary or
desirable to be done in connection with the foregoing as such Contributor might
or could do in person. Each Contributor hereby ratifies and approves the acts of
such attorney and any substitute therefor.
9.9 Further Assurances. The parties shall execute and deliver all
documents, provide all information and take or refrain from taking
action as may be necessary or appropriate to achieve the purposes of
this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed or caused this
Agreement to be executed, all as of the day and year first above written.
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GROVE OPERATING, L.P.
By: GROVE PROPERTY TRUST
Its General Partner
By: /s/Damon Navarro
-------------------------
Damon Navarro
President
NORTHEAST APARTMENTS I LIMITED
PARTNERSHIP
By: NEALP, Inc., its general partner
By: /s/Joseph LaBrosse
--------------------------
Joseph LaBrosse
Treasurer
WEST HARTFORD CENTER ASSOCIATES LIMITED
PARTNERSHIP
By: WHCALP, Inc., its general partner
By: /s/Joseph LaBrosse
---------------------------
Joseph LaBrosse
Treasurer
27
<PAGE>
WINDSOR EQUITY PARTNERSHIP
By: GROVE OPERATING, L.P., a Partner
By: GROVE PROPERTY TRUST
Its General Partner
By: /s/Joseph LaBrosse
---------------------------
Joseph LaBrosse
Treasurer
By: GROVE EQUITY PARTNERSHIP, a Partner
By: /s/Damon Navarro
------------------------
Damon Navarro
A Partner Duly Authorized
By: T.F. FREDERICKSON HOLDINGS, a Partner
By: /s/Ivan C. Frederickson
-------------------------------
Ivan C. Frederickson
A Partner Duly Authorized
By: /s/Alan J. Dlugash
--------------------------
Alan J. Dlugash, a Partner
WINDSOR COMMONS CORPORATION
By: /s/Damon Navarro
-----------------------
Damon Navarro
Its President
28
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SCHEDULE A
Contributor Transfers and Consideration
================================================================================
Transferred Consideration
Assets
================================================================================
- --------------------------------------------------------------------------------
1. Northeast Apartments I Northeast Project 219,898 Units
Limited Partnership
- -------------------------------------------------------------------------------
2. West Hartford Center West Hartford 103,074 Units
Assets Limited Center Project
Partnership
- --------------------------------------------------------------------------------
3. Windsor Equity Its Partnership Interest in 91,339 Units
Partnership Windsor Arbor
- -------------------------------------------------------------------------------
4. Windsor Commons 99% of its Partnership 5,872 Units
Corporation Interest in Windsor Arbor
===============================================================================
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE 1 DEFINITIONS 1
1.1 Definitions 1
1.2 References 7
ARTICLE 2 CONTRIBUTION AND ACCEPTANCE; OTHER TRANSACTIONS 7
2.1 Contribution and Acceptance of GPT Properties 7
2.2 Contribution and Acceptance of New Equity Proceeds 9
2.3 Non-Liquidating Property Partnerships 9
2.4 Liquidating Property Partnerships 9
2.5 Management Company Assets and Liabilities 10
2.6 Burgundy Studio Apartments 10
ARTICLE 3 CONSIDERATION 11
3.1 Units and Cash 11
3.2 Operating Partnership Agreement 11
ARTICLE 4 COVENANTS, REPRESENTATIONS AND WARRANTIES 12
4.1 Representations and Warranties of the Grove Contributors 12
4.2 Representations and Warranties of GPT 18
4.3 Representations and Warranties of the Other Contributors 24
4.4 Representations and Warranties of the Operating Partnership 25
4.5 Survival of Representations and Warranties 26
ARTICLE 5 CLOSING MATTERS 27
5.1 Closing 27
5.2 New York Style Closing 27
5.3 Surveys, Title Commitments and Searches 27
5.4 Title Policies 27
ARTICLE 6 CLOSING DELIVERIES 28
6.1 The Contributors' Deliveries 28
6.2 The Operating Partnership's Deliveries 31
6.3 Concurrent Transactions 31
6.4 Further Assurances 31
6.5 Possession 31
6.6 Employees and Benefit Plans 32
ARTICLE 7 APPORTIONMENTS; SECURITY DEPOSITS 32
7.1 Apportionments for Wholly-Owned Projects 32
7.2 Apportionments for Non-Liquidating Partnerships 33
7.3 Apportionments for Management Company 34
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Page
7.4 Payment of Apportionments 34
7.5 Security Deposits 34
ARTICLE 8 INDEMNITIES 34
8.1 The Contributors' Indemnity 34
8.2 The Operating Partnership's Indemnity 35
8.3 Notice of Claims 35
8.4 Limitation on Liability 35
8.5 Limitations on Indemnification Obligations. 36
ARTICLE 9 MISCELLANEOUS 36
9.1 Expenses 36
9.2 Brokerage 36
9.3 Survival 36
9.4 Construction 37
9.5 General 37
9.6 Headings 37
9.7 Governing Law; Parties at Interest 37
9.8 Power of Attorney 37
Schedules
Schedule A - Contributions
AMENDMENT
TO
CERTIFICATE OF LIMITED PARTNERSHIP
OF
WINDSOR ARBOR LIMITED PARTNERSHIP
The undersigned, desiring to amend the Certificate of Limited Partnership
of Windsor Arbor Limited Partnership, do hereby certify:
1. The name of the Limited Partnership is: Windsor Arbor Limited Partnership.
2. The date of filing of the original certificate of limited partnership
was: January _, 1994.
3. The following entity has been substituted for Windsor Common Corporation
as general partner:
GPT-Windsor, LLC
598 Asylum Street
Hartford, CT 06105
The undersigned have signed this Amendment on the ____ of June, 1997.
Former General Partner:
Windsor Common Corporation
By
-----------------------
It's President
General Partner
GPT-Windsor, LLC
By
------------------------
It's Managing Member
