<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): December 31, 1996
WEEKS CORPORATION
(Exact name of registrant as specified in its charter)
Georgia 011-13254 58-1525322
------- --------- ----------
(State of (Commission File (IRS Employer
Incorporation) Number) Identification No.)
4497 Park Drive, Norcross, Georgia 30093
----------------------------------------
(Address of principal executive offices, including zip code)
(770)923-4076
-------------
(Registrant's telephone number, including area code)
<PAGE>
Item 2. Acquisition or Disposition of Assets
On December 31, 1996 (the "Initial Closing"), Weeks Realty, L.P., a Georgia
limited partnership (the "Operating Partnership") closed the first phase of its
previously disclosed transaction with Lichtin Properties, Inc., and its
affiliated entities ("Lichtin") by acquiring 14 completed and in-service
industrial and suburban office buildings (the "Initial Acquisition Properties")
in the Raleigh-Durham-Chapel Hill area of North Carolina for aggregate
acquisition consideration of approximately $89.4 million, and approximately 37
net usable acres of undeveloped land and options to acquire an additional 177
net usable acres of undeveloped land (the "Initial Acquisition Land") for total
acquisition consideration of approximately $3.3 million. The Initial Acquisition
Properties total approximately 1.1 million square feet of leasable space and had
an average occupancy as of December 31, 1996 of approximately 96%. The
acquisition was consummated pursuant to certain acquisition agreements (the
"Acquisition Agreements") by and among the Operating Partnership, Weeks
Corporation, a Georgia corporation (together with the Operating Partnership, the
"Company"), and Lichtin. The Company initially disclosed the transaction in its
Current Report on Form 8-K dated November 5, 1996 and filed on November 6, 1996
(the "November Current Report").
The Acquisition Agreements provide for Lichtin to combine its property
portfolio, management team and business operations with and into the Company in
exchange for shares of common stock of Weeks Corporation ("Shares"), units of
limited partnership interest ("Units") in the Operating Partnership, cash and
the assumption of debt. Lichtin's principal owner, Harold S. Lichtin, joined
the Company as a member of senior management and all of the approximately 50
other employees of Lichtin were employed by the Company. Mr. Lichtin has also
been elected to the Company's Board of Directors. In order to maintain the
independent majority on the Board of Directors, the Company intends to add one
additional director. In addition, Mr. Lichtin was granted options to purchase
40,000 Shares at a per Share price equal to the closing price of the Shares on
the New York Stock Exchange on December 31, 1996 ($33.25).
Condiseration for the Initial Acquisition Properties and Initial Acquisition
Land consisted of 282,178 Shares and 565,459 Units having an aggregate agreed
upon value of approximately $21.4 million, based on the average per Share
trading price of the Shares ($25.25) for the 20 trading days immediately
preceeding the date on which the parties signed the letter of intent relating to
the acquisition (July 3, 1996), aproximately $8.6 million of cash, the
assumption of approximately $47.6 million of mortgage indebtedness with a
weighted average interest rate of approximately 8.5%, and the assumption and
repayment of other indebtedness through borrowings under the Company's line of
credit of approximately $15.1 million.
<PAGE>
The Acquisition Agreements also provide for the Company to acquire from Lichtin
in 1997 five completed and in-service properties (the "1997 Acquisition
Properties"), which total approximately 300,000 square feet and had average
occupancy as of December 31, 1996 of 92%. Four of the 1997 Acquisition
Properties totaling approximately 210,000 square feet are expected to be
acquired by January 31, 1997, for agreed upon acquisition consideration of
approximately $8.2 million, consisting of the assumption of approximately $6.7
million of mortgage indebtedness with an average interest rate of approximately
9.0%, and the issuance of approximately 56,000 Units (with an agreed upon value
per Unit of $25.25). The additional 1997 Acquisition Property totaling
approximately 85,000 square feet is expected to be acquired on or about August
31, 1997, for agreed upon acquisition consideration of $5.2 million, consisting
entirely of the assumption of mortgage indebtedness, which the Company currently
intends to refinance through borrowings under the Company's line of credit. The
Company will be the property and leasing manager for the 1997 Acquisition
Properties until they are acquired.
The Acquisition Agreements further provide for the Company to acquire from
Lichtin six completed and in-service properties with a total of 370,734 square
feet (the "Northern Telecom Properties"), which are 100% leased through June
2005 to Northern Telecom, Inc., ("Northern Telecom"). The Northern Telecom
Properties currently account for approximately $2.9 million of annual base rent,
which will equal approximately 4% of the Company's total annual base rent, pro
forma for the acquisitions of the Initial Acquisition Properties, the 1997
Acquisition Properties, the Northern Telecom Properties and the acquisition of
the Nashville Properties described in the Company's Current Report on Form 8-K
dated November 1, 1996 and filed with the Securities and Exchange Commission on
November 6, 1996. Northern Telecom would become the Company's largest tenant
measured by annualized base rent.
The Company expects to acquire the Northern Telecom Properties on or about July
1, 1997, for agreed upon acquisition consideration of approximately $23.1
million, consisting of the assumption of approximately $17.4 million of mortgage
indebtedness with an average interest rate of approximately 8.9%, the assumption
and repayment through borrowings under the Company's line of credit of
approximately $3 million of other indebtedness, approximately $1 million in
cash, and the issuance of approximately $1.7 million of Units (with an agreed
upon value per Unit based on the average closing price of the Shares for the 20
trading days preceding the acquisition, subject to a minimum value per Unit of
$25.25 and a maximum value per Unit of $27.00).
If, however, Northern Telecom exercises the first of its two early termination
options described in the November Current Report, the closing of one or more of
the Northern
<PAGE>
Telecom Properties could be delayed until the earlier of the date of substantial
re-leasing, or June 30, 2000. The acquisition consideration for any Northern
Telecom Property acquired by the Company under these circumstances would be
computed based on annualized in-place Net Operating Income (as defined below)
capitalized at a rate of 10.5%. "Net Operating Income" is defined under the
Acquisition Agreements as gross annualized rental income, including
reimbursables (assuming that reimbursements may include management fees
calculated on total revenues, less reimbursements in certain cases for
utilities), for the ensuing twelve (12) month period less a five percent (5%)
vacancy factor (computed on the entire building deemed to be or actually one
hundred percent (100%) leased, less any portion of that building leased for ten
(10) years or longer) and less approved pro forma annual operating expenses
(which shall be deemed to include a four percent (4%) management fee on total
revenues, an allocation of specified management office expenses and a reserve of
five cents ($.05) per square foot per annum for bulk industrial and business
distribution space, eight cents ($.08) per square foot per annum for business
service space and ten cents ($.10) per square foot per annum for suburban office
space, as adjusted for certain other factors described in the Acquisition
Agreements. The acquisition consideration would also be paid in the form of
Units, cash of $1 million, and the assumption of indebtedness; however, the
Units would be valued at the average closing price of the Shares for the 20
trading days prior to the acquisition.
The Acquisition Agreements also provide for the acquisition of four buildings
(the "Development Properties") currently under development or in lease-up. The
Development Properties total approximately 324,000 square feet and will be
acquired over time as each Development Property achieves stabilization
(generally, 95% occupancy), but in no event later than June 30, 1998. The
acquisition consideration for each Development Property will equal the greater
of (i) estimated Net Operating Income, as defined above, capitalized at 10.4%,
or (ii) the cost of development.
Consideration for each Development Property will consist of Units (with an
agreed upon value per Unit based on the average closing price of the Shares for
the 20 trading days prior to the acquisition of such Development Property,
except that for any Development Property acquired on or before July 1, 1997, the
value per Unit will be subject to a minimum value of $25.25 and a maximum value
of $27.00) and the assumption of construction indebtedness, which the Company
expects to refinance through borrowings under its line of credit.
Based on the pricing formula described above, and assuming the four Development
Properties achieve their budgeted Net Operating Income by their respective
budgeted stabilization dates, the Company believes the total acquisition
consideration for the four
<PAGE>
Development Properties will be approximately $26.2 million, consisting of
approximately $4.1 million of Units and the assumption of approximately $22.1
million of construction indebtedness. The Company will be the development and
leasing manager for the Development Properties until they are acquired. At
December 31, 1996, the Development Properties were pre-leased on average 44%.
The Acquisition Agreements further provide for the acquisition by the Company of
approximately 71 net usable acres of additional undeveloped land (the
"Undeveloped Land") in staged acquisitions over the next four to five years. All
of the Undeveloped Land is located in five business parks formerly developed and
controlled by Lichtin. Approximately 5 net usable acres of the Undeveloped Land
are expected to be acquired by the end of 1997 for approximately $1 million in
Units (with an agreed upon value per Unit of $25.25). The Company expects to
acquire the remaining approximately 66 net usable acres of Undeveloped Land in
approximately equal installments over the next four to five years for a total of
$7.4 million, also paid in Units (with an agreed upon value per Unit based on
the average closing price of the Shares for the 20 trading days preceding the
acquisition of such Undeveloped Land). In addition, the Company will pay for
certain infrastructure and engineering costs associated with the Undeveloped
Land.
The Company currently estimates that fees and expenses of the North Carolina
acquisitions will total approximately $1.2 million.
<PAGE>
The following tables set forth certain information concerning the Initial
Acquisition Properties, the 1997 Acquisition Properties, the Northern Telecom
Properties, and the Development Properties:
<TABLE>
<CAPTION>
Initial Acquisition Properties
<S> <C> <C> <C>
- --------------------------------------------------------------------------------
Business Park/ Square 12/31/96 Year
Property Feet Occupancy Constructed
- --------------------------------------------------------------------------------
Perimeter Park West
1400 Perimeter Park West 44,916 100% 1991
1500 Perimeter Park West 81,196 91% 1996
1600 Perimeter Park West 94,897 100% 1994
1800 Perimeter Park West 55,636 100% 1994
- --------------------------------------------------------------------------------
Subtotal 276,645 97%
- --------------------------------------------------------------------------------
Interchange Plaza
Interchange Plaza I 37,630 100% 1993
Interchange Plaza II 69,491 100% 1995
- --------------------------------------------------------------------------------
Subtotal 107,121 100%
- --------------------------------------------------------------------------------
Enterprise Center
Enterprise Center I 106,583 100% 1993
Enterprise Center II 104,158 83% 1995
- --------------------------------------------------------------------------------
Subtotal 210,741 92%
- --------------------------------------------------------------------------------
Metro Center
Metro Center I 75,000 100% 1989
Metro Center II 59,927 100% 1990
Metro Center III 137,500 98% 1992
- --------------------------------------------------------------------------------
Subtotal 272,427 99%
- --------------------------------------------------------------------------------
Perimeter Park
900 Perimeter Park 50,231 100% 1982
Woodlake Center
Woodlake I 108,000 100% 1994
Other
6501 Weston Parkway 93,351 86% 1996
- --------------------------------------------------------------------------------
Total Initial Acquistiion Properties 1,118,516 96%
- --------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
1997 Acquisition Properties
<S> <C> <C> <C>
- --------------------------------------------------------------------------------
Business Park/ Square 12/31/96 Year
Property Feet Occupancy Constructed
- --------------------------------------------------------------------------------
Research Triangle Industrial Center
RTIC I & II 85,129 100% 1982
RTIC III 42,712 100% 1982
RTIC IV 26,500 100% 1982
- --------------------------------------------------------------------------------
Subtotal 154,341 100%
- --------------------------------------------------------------------------------
Perimeter Park
1000 Perimeter Park 56,436 96% 1982
Perimeter Park West
1100 Perimeter Park West 84,950 74% 1990
- --------------------------------------------------------------------------------
Total 1997 Acquisition Properties 295,727 92%
- --------------------------------------------------------------------------------
Northern Telecom Properties
- --------------------------------------------------------------------------------
Business Park/ Square 12/31/96 Year
Property Feet Occupancy Constructed
- --------------------------------------------------------------------------------
Perimeter Park
100 Perimeter Park 55,664 100% 1987
200 Perimeter Park 55,664 100% 1987
300 Perimeter Park 55,664 100% 1986
400 Perimeter Park 74,088 100% 1983
500 Perimeter Park 74,017 100% 1985
800 Perimeter Park 55,637 100% 1984
- --------------------------------------------------------------------------------
Total Northern Telecom Properties 370,734 100%
- --------------------------------------------------------------------------------
Development Properties
- --------------------------------------------------------------------------------
Business Park/ Square 12/31/96 Year
Property Feet Pre-leasing Constructed
- --------------------------------------------------------------------------------
Woodlake Center
Woodlake III 97,200 56% 1997
Regency Forest
Regency-Sprint 100,000 40% 1997
Perimeter Park West
2000 Perimeter Park West 55,636 0% 1997
Enterprise Center
Enterprise III 70,848 64% 1997
- --------------------------------------------------------------------------------
Total Development Properties 323,684 44%
- --------------------------------------------------------------------------------
</TABLE>
This Current Report contains forward-looking information that is subject to
certain risks and uncertainties that could cause actual results to differ
materially from those projected. Among those risks and uncertainties are the
general economic climate; the supply of and demand for industrial and suburban
office properties in Raleigh-Durham-Chapel Hill, North Carolina and the
Southeast; risks associated with the development and acquisition of properties;
including risks that the development, acquisition or lease-up may not be
completed on schedule, that tenants will not take occupancy or pay rent, or that
development or operating costs may be greater than anticipated. For further
information on factors which could impact the Company and the statements
contained herein, reference is made to the Company's other filings with the
Securities and Exchange Commission.
<PAGE>
Item 7. Financial Statements and Exhibits.
(a) Financial Statements of Business Acquired.
The audited historical financial statements of Lichtin required by this
Item 7(a) were previously filed as Exhibit A to the November Current
Report and are incorporated herein by reference to such filing. The
interim historical financial statements of Lichtin Properties required
by this Item 7(a) are not currently available. Such interim financial
statements will be filed as soon as practicable and in no event later
than 60 days after the date that this Current Report is required to be
filed.
(b) Pro Forma Financial Information.
The pro forma financial information required by this Item 7(b) is not
currently available. Such pro forma financial information will be filed
as soon as practicable and in no event later than 60 days after the date
that this Current Report is required to be filed.
(c) Exhibits.
Exhibit Number Description
- -------------- -----------
2.1 Contribution Agreement by and between Harold S. Lichtin and
Weeks Realty, L.P., dated December 31, 1996.
2.2 Agreement and Plan of Merger by and among Lichtin
Properties, Inc., Harold S. Lichtin and Weeks Corporation,
dated December 31, 1996.
2.3 Contribution Agreement for Northern Telecom Properties,
among the Contributors identified therein (the
"Contributors") and Weeks Realty, L.P. doing business as
Weeks Realty Limited Partnership, dated December 31, 1996.
2.4 Contribution Agreement (Perimeter Park West Land) among
Harold S. Lichtin, Marie Antoinette Robertson, and
Perimeter Park West Associates, and Weeks Realty, L.P.
doing business as Weeks Realty Limited Partnership, dated
December 31, 1996.
2.5 Contribution Agreement for Completed Properties Lichtin
Portfolio among the Contributors and Weeks Realty, L.P.
doing business as Weeks Realty Limited Partnership, dated
December 31, 1996.
2.6 Contribution Agreement for Development Properties and
Regency Forrest Land among the Contributors and Weeks
Realty, L.P. doing business as Weeks Realty Limited
Partnership, dated December 31, 1996.
3.1 Third Amended and Restated Bylaws of Weeks Corporation.
10.1 Registration Rights and Lock-Up Agreement by and among
Weeks Corporation and Harold S. Lichtin, Noel A. Lichtin,
Marie A. Robertson, Amy R. Ehrman, Roland G. Robertson and
Perimeter Park West Associates Limited Partnership, dated
December 31, 1996.
10.2 Registration Rights and Lock-Up Agreement for Post-June 30,
1998 Units by and among Weeks Corporation and Harold S.
Lichtin, Noel A. Lichtin, Marie A. Robertson, Amy R.
Ehrman, Roland G. Robertson and Perimeter Park West
Associates Limited Partnership, dated December 31, 1996.
10.3 Employment Agreement by and between Harold S. Lichtin and
Weeks Corporation, dated December 31, 1996.
10.4 Noncompetition Agreement by and between Harold S. Lichtin
and Weeks Corporation and its Affiliates, dated December
31, 1996.
10.5 Indemnification Agreement by and between Weeks Corporation
and Harold S. Lichtin, dated December 31, 1996.
10.6 Second Amendment to the Second Amended and Restated
Agreement of Limited Partnership of Weeks Realty, L.P. by
and among Harold S. Lichtin, Noel A. Lichtin, Marie
Antoinette Robertson, Amy R. Ehrman, Roland G. Robertson
and Perimeter Park West Associates Limited Partnership,
Weeks GP Holdings, Inc. and Weeks Corporation, dated
December 31, 1996.
-1-
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
WEEKS CORPORATION
Registrant
Date: January 14, 1997 /s/David P. Stockert
---------------------------
David P. Stockert
Senior Vice President and
Chief Financial Officer
<PAGE>
Exhibit Number Description
- -------------- -----------
2.1 Contribution Agreement by and between Harold S. Lichtin and
Weeks Realty, L.P., dated December 31, 1996.
2.2 Agreement and Plan of Merger by and among Lichtin
Properties, Inc., Harold S. Lichtin and Weeks Corporation,
dated December 31, 1996.
2.3 Contribution Agreement for Northern Telecom Properties,
among the Contributors identified therein (the
"Contributors") and Weeks Realty, L.P. doing business as
Weeks Realty Limited Partnership, dated December 31, 1996.
2.4 Contribution Agreement (Perimeter Park West Land) among
Harold S. Lichtin, Marie Antoinette Robertson, and
Perimeter Park West Associates, and Weeks Realty, L.P.
doing business as Weeks Realty Limited Partnership, dated
December 31, 1996.
2.5 Contribution Agreement for Completed Properties Lichtin
Portfolio among the Contributors and Weeks Realty, L.P.
doing business as Weeks Realty Limited Partnership, dated
December 31, 1996.
2.6 Contribution Agreement for Development Properties and
Regency Forrest Land among the Contributors and Weeks
Realty, L.P. doing business as Weeks Realty Limited
Partnership, dated December 31, 1996.
3.1 Third Amended and Restated Bylaws of Weeks Corporation.
10.1 Registration Rights and Lock-Up Agreement by and among
Weeks Corporation and Harold S. Lichtin, Noel A. Lichtin,
Marie A. Robertson, Amy R. Ehrman, Roland G. Robertson and
Perimeter Park West Associates Limited Partnership, dated
December 31, 1996.
10.2 Registration Rights and Lock-Up Agreement for Post-June 30,
1998 Units by and among Weeks Corporation and Harold S.
Lichtin, Noel A. Lichtin, Marie A. Robertson, Amy R.
Ehrman, Roland G. Robertson and Perimeter Park West
Associates Limited Partnership, dated December 31, 1996.
10.3 Employment Agreement by and between Harold S. Lichtin and
Weeks Corporation, dated December 31, 1996.
10.4 Noncompetition Agreement by and between Harold S. Lichtin
and Weeks Corporation and its Affiliates, dated December
31, 1996.
10.5 Indemnification Agreement by and between Weeks Corporation
and Harold S. Lichtin, dated December 31, 1996.
10.6 Second Amendment to the Second Amended and Restated
Agreement of Limited Partnership of Weeks Realty, L.P. by
and among Harold S. Lichtin, Noel A. Lichtin, Marie
Antoinette Robertson, Amy R. Ehrman, Roland G. Robertson
and Perimeter Park West Associates Limited Partnership,
Weeks GP Holdings, Inc. and Weeks Corporation, dated
December 31, 1996.
-1-
<PAGE>
===============================================================================
CONTRIBUTION AGREEMENT
BY AND BETWEEN
HAROLD S. LICHTIN
AND
WEEKS REALTY, L.P.
DATED AS OF DECEMBER 31, 1996
===============================================================================
<PAGE>
TABLE OF CONTENTS
-----------------
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
ARTICLE I CONTRIBUTION................................................................... 1
Section 1.01 Contribution of Assets............................................. 1
----------------------
Section 1.02 Excluded Assets.................................................... 1
---------------
Section 1.03 Assumed Obligations................................................ 1
-------------------
Section 1.04 Excluded Liabilities............................................... 1
--------------------
ARTICLE II CONSIDERATION................................................................ 2
Section 2.01 Form and Amount of Consideration................................... 2
--------------------------------
Section 2.02 The Closing........................................................ 2
-----------
ARTICLE III REPRESENTATIONS AND WARRANTIES OF LICHTIN................................... 2
Section 3.01 Power; Authority................................................... 2
----------------
Section 3.02 Due Authorization; Binding Agreement............................... 3
------------------------------------
Section 3.03 Governmental Consents.............................................. 3
---------------------
Section 3.04 Other Consents..................................................... 3
--------------
Section 3.05 No Violation....................................................... 3
------------
Section 3.06 Compliance with Laws............................................... 3
--------------------
Section 3.07 Absence of Undisclosed Liabilities and Contractual Obligations.... 3
---------------------------------------------------------------
Section 3.08 Contracts in Force................................................. 4
------------------
Section 3.09 Litigation......................................................... 4
----------
Section 3.10 Financial Status................................................... 4
----------------
Section 3.11 Taxes.............................................................. 4
-----
Section 3.12 Title to Assets.................................................... 4
---------------
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF WEEKS...................................... 4
Section 4.01 Organization; Authority............................................ 4
-----------------------
Section 4.02 Due Authorization; Binding Agreement............................... 4
------------------------------------
Section 4.03. No Violation....................................................... 5
------------
Section 4.04 Litigation......................................................... 5
----------
ARTICLE V COVENANTS AND AGREEMENTS...................................................... 5
Section 5.01. Further Assurances................................................. 5
------------------
-i-
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
ARTICLE VI INDEMNIFICATION............................................................... 5
Section 6.01. Survival; Reliance.................................................. 5
------------------
Section 6.02. Indemnification..................................................... 6
---------------
ARTICLE VII MISCELLANEOUS................................................................ 6
Section 7.01. Fees and Expenses; Transfer Taxes................................... 6
---------------------------------
Section 7.02. Notices............................................................. 6
-------
Section 7.03. Entire Agreement.................................................... 7
----------------
Section 7.04. Waivers and Amendments.............................................. 7
----------------------
Section 7.05. Governing Law....................................................... 7
-------------
Section 7.06. Binding Effect; Benefit............................................. 7
-----------------------
Section 7.07. No Assignment....................................................... 7
-------------
Section 7.08. Counterparts........................................................ 8
------------
Section 7.09. Headings............................................................ 8
--------
-ii-
</TABLE>
<PAGE>
CONTRIBUTION AGREEMENT
CONTRIBUTION AGREEMENT (the "Agreement") dated as of December 31, 1996 (the
"Contribution Date"), by and between Harold S. Lichtin, an individual resident
of the State of North Carolina ("Lichtin"), and Weeks Realty, L.P., a Georgia
limited partnership authorized to do business in the State of North Carolina as
Weeks Realty Limited Partnership ("Weeks").
W I T N E S S E T H:
- - - - - - - - - -
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto,
intending to be legally bound, agree as follows:
ARTICLE I
CONTRIBUTION
Section 1.01. Contribution of Assets. Lichtin hereby contributes to the
----------------------
capital of Weeks, effective as of the Contribution Date, and Weeks hereby
accepts from Lichtin, effective as of the Contribution Date (the
"Contribution"), the right, title and interest in and to certain personal
property of Lichtin (the "Personal Property"); it being the intention of Lichtin
to contribute and it being the intention of Weeks to accept and receive the
Personal Property, free and clear of all liens other than those liens specified
in Section 1.03 hereof. The Personal Property shall consist only of those items
expressly identified on Schedule 1.01, attached hereto.
-------------
Section 1.02. Excluded Assets. Notwithstanding anything to the contrary
---------------
contained in Section 1.01 hereof, the parties to this Agreement expressly
understand and agree that Lichtin is not, pursuant to this Agreement, conveying
or contributing to Weeks any assets, rights or properties other than those
identified in Section 1.01 hereof.
Section 1.03. Assumed Obligations . Weeks hereby assumes, and agrees to
--------------------
pay, as soon as practicable following the Closing, those liabilities and
obligations, and only those liabilities and obligations, expressly identified on
Schedule 1.03, attached hereto (the "Assumed Obligations").
- -------------
Section 1.04. Excluded Liabilities. Except for the Assumed Obligations, no
--------------------
obligation or liability of Lichtin, whether or not relating to or arising out of
the ownership of the Personal Property, of any nature whatsoever (whether
expressed or implied, fixed or contingent, liquidated or unliquidated, known or
unknown, accrued, due or to become due), is being assumed by Weeks, nor shall
Weeks be liable to pay, perform or discharge any such obligation or liability,
nor shall any of the property or assets being contributed to Weeks pursuant
-1-
<PAGE>
hereto be subject to any such obligation or liability. Lichtin shall pay,
perform, and discharge all of the Excluded Liabilities consistent with present
practice.
ARTICLE II
CONSIDERATION
Section 2.01. Form and Amount of Consideration. In consideration of
--------------------------------
Lichtin's transfer and delivery of the Personal Property, Weeks does hereby
assume, and agree to pay, perform and discharge those liabilities and
obligations identified on Schedule 1.03.
-------------
Section 2.02. The Closing.
-----------
(a) The Contribution will occur simultaneously with the execution and
delivery hereof and shall commence at 9:00 a.m., EST, on the Contribution
Date at the offices of Kennedy Covington Lobdell & Hickman, L.L.P.,
NationsBank Corporate Center, Suite 4200, 100 North Tryon Street,
Charlotte, North Carolina 28202-4006, or at such other place as may be
agreed by Lichtin and Weeks (the "Closing").
(b) At the Closing, Lichtin will execute and deliver to Weeks the
following:
(i) Assignments, bills of sale or other documents or instruments
of transfer, in form and substance reasonably acceptable to Weeks, to
transfer to Weeks all tangible and intangible property included in the
Personal Property; and
(ii) Such other instruments or documents, in form and substance
reasonably acceptable to Weeks, as may be necessary to effect the
Closing or evidence the Contribution.
(c) At the Closing, Weeks has entered into the Transaction Documents
(as defined in the Second Amendment to the Second Amended and Restated
Agreement of Limited Partnership of Weeks Realty, L.P. dated as of the date
hereof) and delivered such other instruments and documents, in form and
substance reasonably acceptable to Lichtin, as may be necessary to effect
the Closing or evidence the Contribution.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF LICHTIN
Section 3.01. Power; Authority. Lichtin has all the necessary power and
----------------
authority to enter into and perform his obligations under this Agreement.
-2-
<PAGE>
Section 3.02. Due Authorization; Binding Agreement. This Agreement has
------------------------------------
been duly executed and delivered by Lichtin and constitutes a legal, valid and
binding obligation of Lichtin, enforceable against Lichtin in accordance with
the terms hereof (except as enforcement may be limited by bankruptcy, insolvency
or other laws affecting enforcement of creditors' rights generally and general
equity principles).
Section 3.03. Governmental Consents. Except as has been obtained or is
---------------------
being effected as part of the consummation of the transactions contemplated by
this Agreement, no consent, waiver, approval or authorization of, or filing,
registration (except for registration of titles to motor vehicles) or
qualification with, or notice to, any governmental unit or any other regulatory
body is required to be made, obtained or given by Lichtin in connection with the
execution, delivery and performance of this Agreement.
Section 3.04. Other Consents . Except for waivers and consents that have
---------------
been obtained prior to the date hereof, no consent of any party to any
agreement, contract, mortgage, indenture, lease, reciprocal easement or
operating agreement or other arrangement, to which Lichtin is a party, or, by
which Lichtin is bound, is required in connection with the execution, delivery
or performance by Lichtin of this Agreement or the consummation of the
transactions provided for herein; provided, however, no consent to the
assumption of the Assumed Obligations has been secured from First Union National
Bank and such Assumed Obligations will be paid as set forth in Section 1.03.
Section 3.05. No Violation. Except for waivers and consents that have been
------------
obtained prior to the date hereof, none of the execution, delivery and
performance of this Agreement by Lichtin does or will, with or without the
giving of notice, lapse of time or both, (i) violate, conflict with or
constitute a default under any term or condition of any term or provision of any
judgment, decree, order, statute, injunction, rule or regulation of a
governmental unit applicable to Lichtin or any agreement, contract, mortgage,
indenture, lease, reciprocal easement or operating agreement or other
arrangement to which Lichtin is a party or by which he is bound or to which any
of his assets is subject, except in the case where appropriate waivers and
consents have been obtained prior to the date hereof, or (ii) result in the
creation of any lien or other encumbrance upon the Personal Property, except as
may be contemplated by this Agreement.
Section 3.06. Compliance with Laws. Lichtin has complied with all laws
--------------------
applicable to the ownership, use and operation of the Personal Property and has
obtained all licenses and permits required for the conduct thereof. To
Lichtin's knowledge, such licenses and permits are in full force and effect,
Lichtin has not taken any action that would (or failed to take any action the
omission of which would) result in the revocation of such licenses or permits,
and Lichtin has not received any notice of violation from any federal, state or
municipal entity or written notice of an intention by any such government entity
to revoke any certificate of occupancy or other certificate, license or permit
issued by it in connection with the Personal Property, that in each case has not
been cured or otherwise resolved to the satisfaction of such government entity.
Section 3.07. Absence of Undisclosed Liabilities and Contractual
--------------------------------------------------
Obligations. The consummation of the transactions effected hereby will not
- -----------
subject Weeks or any of its assets, including, without limitation, those
-3-
<PAGE>
contributed pursuant hereto, to any liability or obligation whatsoever, except
for the Assumed Obligations.
Section 3.08. Contracts in Force. Each of the agreements related to the
------------------
Personal Property are valid and binding and in full force and effect,
enforceable against the parties thereto in accordance with its terms (except as
enforcement may be limited by bankruptcy, insolvency or other laws affecting
enforcement of creditors' rights generally and general equitable principles).
To Lichtin's knowledge, no other party to any contract being transferred
pursuant to this Agreement is in default under such contract in any material
respect. The contracts, if any, being transferred pursuant to this Agreement
constitute all of the agreements which are related to the Personal Property.
Section 3.09. Litigation. There are no claims, actions, suits, proceedings
----------
or investigations pending, or, to Lichtin's knowledge, threatened, before any
court, governmental unit, agency, arbitrator, or other forum or tribunal with
respect to the Personal Property.
Section 3.10. Financial Status . Lichtin is solvent, has not made a
-----------------
general assignment for the benefit of his creditors, and has not admitted in
writing his inability to pay his debts as they become due, nor has Lichtin
filed, nor does he contemplate the filing of, any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings, or any other proceeding for
the relief of debtors in general, nor has any such proceeding been instituted by
or against Lichtin, nor is any such proceeding to Lichtin's knowledge threatened
or contemplated.
Section 3.11. Taxes. Lichtin has filed in a timely manner all tax returns
-----
required to be filed by him or on his behalf. All such tax returns are true,
correct and complete in all material respects, and taxes due with respect to
such tax returns have been timely paid in full.
Section 3.12. Title to Assets. Lichtin is the sole owner of and holds
---------------
good, valid and marketable title to all of the assets being transferred to Weeks
pursuant to this Agreement, free and clear of any and all claims, liens,
pledges, security interests, and other encumbrances of any kind except as
otherwise described on Schedule 1.03, attached hereto.
-------------
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF WEEKS
Section 4.01. Organization; Authority. Weeks is a limited partnership duly
-----------------------
formed, validly existing and in good standing under the laws of the State of
Georgia and has all the necessary power and authority to enter into and perform
its obligations under this Agreement.
Section 4.02. Due Authorization; Binding Agreement. The execution,
------------------------------------
delivery and performance of this Agreement by Weeks has been duly and validly
authorized by all necessary action of Weeks. This Agreement has been duly
executed and delivered by Weeks and constitutes a legal, valid and binding
-4-
<PAGE>
obligation of Weeks, enforceable against Weeks in accordance with the terms
hereof (except as enforcement may be limited by bankruptcy, insolvency or other
laws affecting enforcement of creditors' rights generally and general equity
principles).
Section 4.03. No Violation. None of the execution, delivery and
------------
performance of this Agreement by Weeks does or will, with or without the giving
of notice, lapse of time or both, (i) violate, conflict with or constitute a
default under any term or condition of (A) the Second Amended and Restated
Agreement of Limited Partnership of Weeks Realty, L.P., as amended, of Weeks, or
(B) any term or provision of any judgment, decree, order, statute, injunction,
rule or regulation of a governmental unit applicable to Weeks or any agreement,
contract, mortgage, indenture, lease, reciprocal easement or operating agreement
or other arrangement to which Weeks is a party or by which it is bound or to
which any of its assets is subject, except in the case where appropriate waivers
and consents have been obtained prior to the date hereof, and except as would
not have a material adverse effect on Weeks, or (ii) result in the creation of
any lien or other encumbrance upon the assets of Weeks, except as may be
contemplated by this Agreement, and except as would not have a material adverse
effect on Weeks or its assets.
Section 4.04. Litigation. Except as disclosed on Schedule 4.04, attached
---------- -------------
hereto, there are no claims, actions, suits, proceedings or investigations
pending, or, to Weeks' knowledge, threatened, before any court, governmental
unit, agency, arbitrator, or other forum or tribunal with respect to the assets
of Weeks which, if adversely determined, would have a material adverse effect on
the assets of Weeks.
ARTICLE V
COVENANTS AND AGREEMENTS
Section 5.01. Further Assurances. In addition to the actions, contracts
------------------
and other agreements and documents and other papers specifically required to be
taken or delivered pursuant to this Agreement, each of the parties hereto shall
execute such contracts and other agreements and documents and take such further
actions as may be reasonably required or desirable to carry out the provisions
hereof and the Contribution.
ARTICLE VI
INDEMNIFICATION
Section 6.01. Survival; Reliance. The representations, warranties,
------------------
covenants and agreements made by each of the parties hereto shall survive until
the third anniversary of the Contribution Date, and each party hereto has the
right to fully rely on the representations, warranties, covenants and agreements
made by the other party.
-5-
<PAGE>
Section 6.02. Indemnification. In the event Weeks breaches any
---------------
representation, warranty, covenant or agreement contained herein, Weeks agrees
to indemnify and hold harmless Lichtin from all liabilities, demands, claims,
actions, assessments, losses, fines, penalties, costs, damages and expenses
(including, without limitation, reasonable attorneys' and accountants' fees and
expenses) sustained or incurred by Lichtin as a result of such breach. The
liability of Lichtin for a breach of any representation, warranty, covenant or
agreement contained herein shall be governed by Paragraphs 9, 10, 11 and 12 of
the Second Amendment.
ARTICLE VII
MISCELLANEOUS
Section 7.01. Fees and Expenses; Transfer Taxes. Fees and expenses
---------------------------------
incident to the negotiation, preparation and execution of this Agreement and the
performance of the Contribution (including attorneys', accountants', financial
advisors' and other advisors' fees and disbursements) shall be borne by the
party incurring the expense.
Section 7.02. Notices. Any notice or other communication required or
-------
that may be given hereunder shall be in writing and shall be delivered
personally, or sent by certified, registered, or express mail, postage prepaid,
to the parties at the following addresses or such other addresses as shall be
specified by the parties by like notice, and shall be deemed given when so
delivered personally, or if mailed, three days after the date of mailing, as
follows:
(i) If to Weeks:
Weeks Realty, L.P.
4497 Park Drive
Norcross, Georgia 30093
Attention: Thomas D. Senkbeil
Vice Chairman and Chief Investment Officer
with a copy to:
King & Spalding
191 Peachtree Street
Atlanta, Georgia 30303
Attention: William B. Fryer, Esq.
-6-
<PAGE>
(ii) If to Lichtin:
1800 Perimeter Park Drive
Suite 200
Morrisville, North Carolina 27560
Attention: Mr. Harold S. Lichtin
with a copy to:
Kennedy Covington Lobdell & Hickman, L.L.P.
Two Hanover Square
434 Fayetteville Street Mall
Suite 1900
Raleigh, North Carolina 27602-1070
Attention: Alan Peterson, Esq.
Section 7.03. Entire Agreement. This Agreement and the Transaction
----------------
Documents (as defined in the Second Amendment to the Second Amended and Restated
Agreement of Limited Partnership of Weeks Realty, L.P. dated as of the date
hereof) constitute the entire agreement among the parties with respect to the
subject matter hereof and supersedes all prior contracts, agreements
undertakings and understandings, express or implied, written or oral, between
the parties, or any of them, with respect to the subject matter hereof and,
except as otherwise expressly provided herein, is not intended to confer upon
any other person any rights or remedies hereunder.
Section 7.04. Waivers and Amendments. This Agreement may be amended,
----------------------
modified, superseded, canceled, renewed or extended, and the terms and
conditions hereof may be waived, only by a written instrument signed by the
parties hereto.
Section 7.05. Governing Law. This Agreement shall be governed by, and
-------------
construed and enforce in accordance with and subject to, the laws of the State
of North Carolina, without regard to principles of conflicts of law.
Section 7.06. Binding Effect; Benefit. This Agreement shall inure to the
-----------------------
benefit of and be binding upon the parties hereto and their respective
successors and assigns. Nothing in this Agreement, expressed or implied, is
intended to confer on any person other than the parties hereto or their
respective successors and assigns, any rights, remedies, obligations or
liabilities under or by reason of this Agreement.
Section 7.07. No Assignment. This Agreement is not assignable (by
-------------
of law or otherwise) without the prior written consent of the other party.
Section 7.08. Counterparts . This Agreement may be executed in two or more
-------------
counterparts, each of which shall be deemed an original but all of which taken
together shall constitute one and same instrument.
-7-
<PAGE>
Section 7.09. Headings. The headings in this Agreement are for reference
--------
purposes only and shall not in any way affect the meaning or interpretation of
this Agreement.
-8-
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
HAROLD S. LICHTIN
___________________________
WEEKS REALTY, L.P., a Georgia limited
partnership authorized to do business in the
State of North Carolina as Weeks Realty Limited
Partnership
By: Weeks GP Holdings, Inc.
a Georgia corporation, its
Sole General Partner
By: ______________________
Name:
Title:
-9-
<PAGE>
SCHEDULE 4.04
-------------
On December 12, 1996, Gwinco-Gary Joint Venture, a Georgia partnership,
filed a complaint in the Superior Court of Gwinnett County. The complaint names
Weeks Horizon Corporation and the Company as defendants. The action stems from
the development of property in Gwinnett County, Georgia, known as the Horizon
Industrial Park. Gwinco-Gary alleges breaches of fiduciary duty for an alleged
failure to consummate sales with ready, willing and able buyers, and seeks $17.2
million in damages, an unknown amount of profits to be disgorged, and $10
million in punitive damages. The Company intends vigorously to contest the
claims asserted in the complaint.
-12-
<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
AGREEMENT AND PLAN OF MERGER
BY AND AMONG
LICHTIN PROPERTIES, INC.,
HAROLD S. LICHTIN
AND
WEEKS CORPORATION
DATED AS OF DECEMBER 31, 1996
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
-----------------
<TABLE>
<CAPTION>
PAGE
----
<C> <S> <C>
ARTICLE I THE MERGER AND CLOSING.................................... 1
1.01. The Merger................................................ 1
1.02. Conversion of Shares...................................... 2
ARTICLE II REPRESENTATIONS AND WARRANTIES OF
LICHTIN PROPERTIES AND HAROLD S. LICHTIN.................. 2
2.01. Organization; Authority; Subsidiaries..................... 2
2.02. Due Authorization; Binding Agreement...................... 3
2.03. Governmental Consents..................................... 3
2.04. Other Consents............................................ 3
2.05. No Violation.............................................. 3
2.06. Compliance with Laws...................................... 3
2.07. Absence of Undisclosed Liabilities and
Contractual Obligations................................. 4
2.08. Contracts in Force........................................ 4
2.09. Litigation................................................ 4
2.10. Financial Status.......................................... 4
2.11. Taxes..................................................... 4
2.12. Employee Benefits......................................... 5
2.13. Title to Assets........................................... 6
2.14. Investment................................................ 7
2.15. Access to Data............................................ 7
2.16. Experience; Risk.......................................... 7
2.17. Capital Stock............................................. 7
2.18. Books and Records......................................... 7
2.19. Environmental............................................. 7
2.20. Woodlake and Paramount Options............................ 8
ARTICLE III REPRESENTATIONS AND WARRANTIES OF WEEKS
3.01. Organization; Authority................................... 8
3.02. Due Authorization; Binding Agreement...................... 8
3.03. No Violation.............................................. 9
3.04. Litigation................................................ 9
3.05. Financial Statements; Material Changes.................... 9
ARTICLE IV COVENANTS AND AGREEMENTS.................................. 10
4.01. Further Assurances........................................ 10
</TABLE>
-i-
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<C> <S> <C>
4.02. Employee Matters.......................................... 10
4.03. Tax Return................................................ 10
ARTICLE V INDEMNIFICATION........................................... 10
5.01. Survival; Reliance........................................ 10
5.02. Indemnification; Recourse................................. 11
ARTICLE VI MISCELLANEOUS............................................. 12
6.01. Fees and Expenses; Transfer Taxes......................... 12
6.02. Notices................................................... 12
6.03. Entire Agreement.......................................... 13
6.04. Waivers and Amendments.................................... 13
6.05. Governing Law............................................. 13
6.06. Binding Effect; Benefit................................... 13
6.07. No Assignment............................................. 13
6.08. Counterparts.............................................. 13
6.09. Headings.................................................. 13
</TABLE>
-ii-
<PAGE>
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER (the "Agreement") dated as of December 31,
1996, by and among Lichtin Properties, Inc., a North Carolina corporation
("Lichtin Properties"), Harold S. Lichtin, an individual resident of the State
of North Carolina, and Weeks Corporation, a Georgia corporation ("Weeks").
Lichtin Properties and Harold S. Lichtin are sometimes referred to hereafter as
the "Lichtin Parties."
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the respective Boards of Directors of Lichtin Properties and Weeks
have determined that it is advisable that Lichtin Properties be merged with and
into Weeks pursuant to and subject to the terms and conditions of this
Agreement, the Certificate of Merger (as defined below) and the Articles of
Merger (as defined below);
NOW, THEREFORE, in consideration of the premises and the mutual covenants
herein contained and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound, agree as follows:
ARTICLE I
THE MERGER AND CLOSING
1.01. The Merger.
----------
(a) Upon the terms and subject to the conditions of this Agreement,
on the Effective Date (as defined below), Lichtin Properties shall be
merged with and into Weeks (the "Merger"), which shall be the surviving
corporation in the Merger, and the separate corporate existence of Lichtin
Properties shall cease. Subject to the provisions of this Agreement, a
certificate of merger in the form attached as Exhibit A to this Agreement
---------
(the "Certificate of Merger") shall be duly prepared and executed and
---------------------
thereafter delivered to the Secretary of State of the State of Georgia, for
filing, as provided under Georgia law, and articles of merger in the form
attached as Exhibit B to this Agreement (the "Articles of Merger") shall be
--------- ------------------
duly prepared and executed and thereafter delivered to the Secretary of
State of the State of North Carolina, for filing, as provided under North
Carolina law. The Merger shall become effective upon the date of delivery
of the Certificate of Merger to the Office of the Secretary of State of the
State of Georgia (the "Effective Date").
--------------
(b) On and after the Effective Date, the Merger shall have all the
effects set forth under the laws of North Carolina and Georgia. Without
limiting the generality of the foregoing, and subject thereto, by virtue of
the Merger and in accordance with the laws of North Carolina and Georgia,
all of the properties, rights, privileges, powers and franchises of Lichtin
<PAGE>
Properties shall vest in Weeks and all of the debts, liabilities and duties
of Lichtin Properties shall become the debts, liabilities and duties of
Weeks.
(c) The Articles of Incorporation of Weeks in effect immediately
prior to the Effective Date shall be the Articles of Incorporation of Weeks
until thereafter amended, and the Bylaws of Weeks in effect immediately
prior to the Effective Date shall be the Bylaws of Weeks until thereafter
amended.
1.02. Conversion of Shares. As of the Effective Date, by virtue of the
--------------------
Merger and without any action on the part of any holder thereof:
(a) The shares of capital stock of Lichtin Properties that are
issued and outstanding immediately prior to the Effective Date shall be
converted into and become 282,178 fully paid and nonassessable shares of
common stock, par value $.01 per share, of Weeks (the "Shares"). Each of
the parties hereto further acknowledges that the Merger and the
consummation of those transactions contemplated by the Transaction
Documents (as defined in the Second Amendment to the Second Amended and
Restated Agreement of Limited Partnership of Weeks Realty, L.P. dated as of
the date hereof (the "Second Amendment")) shall be simultaneous.
(b) All shares or other capital stock of Lichtin Properties that are
owned by Lichtin Properties as treasury stock shall be canceled and retired
and shall cease to exist and no stock of Weeks or other consideration shall
be delivered in exchange therefor.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF
LICHTIN PROPERTIES AND HAROLD S. LICHTIN
Each of Lichtin Properties and Harold S. Lichtin represents and warrants
to, and agrees with, Weeks as follows:
2.01. Organization; Authority; Subsidiaries. Lichtin Properties is a
-------------------------------------
corporation duly formed, validly existing and in good standing under the laws of
the State of North Carolina and has all the necessary power and authority to
enter into and perform its obligations under this Agreement. Harold S. Lichtin
is the sole shareholder of Lichtin Properties and possesses all necessary power
and authority to control the actions of Lichtin Properties and has all the
necessary power and authority to enter into and perform his obligations under
this Agreement. Lichtin Properties does not own, beneficially or of record, any
capital stock or other equity securities of any corporation or have any direct
or indirect equity or other ownership interest in any business or entity.
-2-
<PAGE>
2.02. Due Authorization; Binding Agreement. The execution, delivery and
------------------------------------
performance of this Agreement by Lichtin Properties has been duly and validly
authorized by all necessary action of Lichtin Properties. This Agreement has
been duly executed and delivered by each of the Lichtin Parties and constitutes
a legal, valid and binding obligation of each of the Lichtin Parties,
enforceable against each such party in accordance with the terms hereof (except
as enforcement may be limited by bankruptcy, insolvency or other laws affecting
enforcement of creditors' rights generally and general equity principles).
2.03. Governmental Consents. Except as has been obtained or is being
---------------------
effected as part of the consummation of the transactions contemplated by this
Agreement, no consent, waiver, approval or authorization of, or filing,
registration or qualification with, or notice to, any governmental unit or any
other regulatory body is required to be made, obtained or given by either of the
Lichtin Parties in connection with the execution, delivery and performance of
this Agreement.
2.04. Other Consents. Except for waivers and consents that have been
--------------
obtained prior to the date hereof, no consent of any party to any agreement,
contract, mortgage, indenture, lease, reciprocal easement or operating agreement
or other arrangement, to which either of the Lichtin Parties is a party, or, by
which either of the Lichtin Parties is bound, is required in connection with the
execution, delivery or performance by the Lichtin Parties of this Agreement or
the consummation of the transactions provided for herein.
2.05. No Violation. Except for waivers and consents that have been
------------
obtained prior to the date hereof, none of the execution, delivery and
performance of this Agreement by either of the Lichtin Parties does or will,
with or without the giving of notice, lapse of time or both, (i) violate,
conflict with or constitute a default under any term or condition of (A) the
Articles of Incorporation or Bylaws of Lichtin Properties, or (B) any term or
provision of any judgment, decree, order, statute, injunction, rule or
regulation of a governmental unit applicable to either of the Lichtin Parties or
any agreement, contract, mortgage, indenture, lease, reciprocal easement or
operating agreement or other arrangement to which either of the Lichtin Parties
is a party or by which either is bound or to which any of its assets is subject,
except in the case where appropriate waivers and consents have been obtained
prior to the date hereof, and except as would not have a material adverse effect
on the business or financial condition of Lichtin Properties, or (ii) result in
the creation of any lien or other encumbrance upon its business, except as may
be contemplated by this Agreement, and except as would not have a material
adverse effect on the business or financial condition of Lichtin Properties.
2.06. Compliance with Laws. Lichtin Properties has complied with all laws
--------------------
applicable to the conduct of its business and to the ownership, use and
operation of its assets and has obtained all licenses and permits required for
the conduct thereof, except where the failure to so comply or obtain will not
have a material adverse effect on its business or financial condition. To the
knowledge of Lichtin Properties, such licenses and permits are in full force and
effect, Lichtin Properties has not taken any action that would (or failed to
take any action the omission of which would) result in the revocation of such
licenses or permits, and Lichtin Properties has not received any notice of
violation from any federal, state or municipal entity or written notice of an
-3-
<PAGE>
intention by any such government entity to revoke any certificate of occupancy
or other certificate, license or permit issued by it in connection with its
business, that in each case has not been cured or otherwise resolved to the
satisfaction of such government entity, except where such failure or such action
will not have a material adverse effect on its business.
2.07. Absence of Undisclosed Liabilities and Contractual Obligations. The
--------------------------------------------------------------
liabilities of Lichtin Properties are as disclosed on Schedule 2.07 attached
-------------
hereto. The consummation of the Merger will not subject Weeks or any of its
assets, including, without limitation, the assets acquired as a result of the
Merger, to any liability or obligation whatsoever, except as otherwise disclosed
on Schedule 2.07.
-------------
2.08. Contracts in Force. Each of the agreements to which Lichtin
------------------
Properties is a party are valid and binding and in full force and effect,
enforceable against the parties thereto in accordance with its terms (except as
enforcement may be limited by bankruptcy, insolvency or other laws affecting
enforcement of creditors' rights generally and general equitable principles).
2.09. Litigation. There are no claims, actions, suits, proceedings or
----------
investigations pending, or, to Lichtin Properties' knowledge, threatened, before
any court, governmental unit, agency, arbitrator, or other forum or tribunal
with respect to Lichtin Properties (including, without limitation, by any
current or former employee of Lichtin Properties).
2.10. Financial Status. Lichtin Properties is solvent, has not made a
----------------
general assignment for the benefit of its creditors, and has not admitted in
writing its inability to pay its debts as they become due, nor has Lichtin
Properties filed, nor does it contemplate the filing of, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or any other
proceeding for the relief of debtors in general, nor has any such proceeding
been instituted by or against Lichtin Properties, nor is any such proceeding to
Lichtin Properties' knowledge threatened or contemplated.
2.11. Taxes. Lichtin Properties is a "small business corporation" and has
------
maintained a valid election to be treated as an "S corporation" under Subchapter
S of the Internal Revenue Code of 1986, as amended (the "Code"), and the
applicable equivalent provisions of North Carolina and all other applicable
state income tax statutes since the date of the Company's organization on
January 12, 1989. Lichtin Properties has not been a party to a "reorganization"
under Section 368 of the Code and is not subject to the "built-in gains tax" of
Section 1374 of the Code or any comparable provision of North Carolina or other
applicable state income tax statutes. Lichtin Properties has no current or
accumulated earnings and profits within the meaning of Section 312 of the Code.
Lichtin Properties has timely filed all federal, state, local and foreign tax
returns required to be filed by it, all such returns are accurate and complete
in all material respects, and Lichtin Properties has paid all taxes (including
any interest, penalties and additions to tax) required to be paid by Lichtin
Properties for all tax periods ending on or prior to the Effective Date, whether
or not in connection with such returns. All deficiencies asserted against
Lichtin Properties as a result of any examinations by the Internal Revenue
-4-
<PAGE>
Service or any other taxing authority have been paid or fully settled. There
are no pending claims asserted for taxes of Lichtin Properties or outstanding
agreements or waivers extending the statutory period of limitation applicable to
any tax return of Lichtin Properties for any period. Lichtin Properties has
complied for all prior periods with the tax withholding provisions of all
applicable federal, state, local and other laws. All accounting periods and
methods used by Lichtin Properties for tax reporting purposes are permissible
periods and methods under applicable law. Lichtin Properties has not been a
member of an affiliated group of corporations filing a consolidated federal
income tax return and does not own stock or any other beneficial ownership
interest in any entity classified as a corporation under the Code. Lichtin
Properties has made available to Weeks true, complete and correct copies of its
federal and state income tax returns for all taxable years since the date of its
organization.
2.12. Employee Benefits.
------------------
(a) Definition of Benefit Plans. For purposes of this
---------------------------
Section 2.12, the term "Benefit Plan" means any plan, program, arrangement,
fund, policy, practice or contract which, through which or under which
Lichtin Properties provides benefits or compensation to or on behalf of
employees or former employees of Lichtin Properties, whether formal or
informal, and whether written or not written.
(b) Title IV Plans. None of Lichtin Properties nor any ERISA
--------------
Affiliate (as defined below) makes or has any obligation to make, or has
made or had any obligation to make, either directly or indirectly (whether
by reimbursing another employer or otherwise), contributions to any plan,
program or arrangement, including a multiemployer plan, that is subject to
Title IV of ERISA (as defined below) (a "Title IV Plan").
(c) Employment Contracts. Lichtin Properties is not a party to nor
--------------------
does it have any obligation whatsoever under any oral or written contract
or other arrangement under which Lichtin Properties has agreed to employ
any person or to compensate any person on a termination of employment
(individually an "Employment Contract" and collectively the "Employment
Contracts").
(d) Documentation. Lichtin Properties has made available to Weeks
-------------
a true and complete copy of all documents relating to any Benefit Plan,
Title IV Plan or Employment Contract.
(e) Compliance; Legal Actions. Each Benefit Plan maintained by
-------------------------
Lichtin Properties has been maintained, by its terms and in operation, in
all material respects in accordance with all applicable laws. There are no
actions, audits, suits or claims known to Lichtin Properties which are
pending or, to the knowledge of Lichtin Properties, threatened against any
Benefit Plan or against the assets of any of the Benefit Plans.
(f) Funding. Lichtin Properties has made full and timely payment
-------
of all amounts required to be contributed under the terms of each Benefit
Plan and applicable law or required to be paid as expenses under such
Benefit Plan, and no excise taxes are assessable as a result of any
-5-
<PAGE>
nondeductible or other contributions made or not made to a Benefit Plan.
The assets of all Benefit Plans which are required under applicable laws to
be held in trust are in fact held in trust, and the assets of each such
Benefit Plan equal or exceed the liabilities of each such plan. The
liabilities of each other plan are in all material respects properly and
accurately reported on the financial statements and records of Lichtin
Properties. Lichtin Properties does not owe any deferred compensation or
commission to any person as of the Effective Date.
(g) Liabilities. Lichtin Properties has not incurred (and no facts
-----------
exist which are reasonably likely to subject Lichtin Properties to) any
liability for any tax, fine or penalty or funding or contribution
obligation as a result of a violation of the Code, ERISA or other
applicable law with respect to any Benefit Plan, Employment Contract, Title
IV Plan or any plan of an ERISA Affiliate.
(h) Claims. There are no pending or threatened claims with respect
------
to a Benefit Plan, Employment Contract or Title IV Plan (other than routine
and reasonable claims made in the ordinary course of plan or contract
operations) or with respect to the terms and conditions of employment or
termination of employment of any employee or former employee of Lichtin
Properties, which claims could reasonably be expected to result in
liability to Lichtin Properties, and no audit or investigation by any
domestic or foreign governmental or other law enforcement agency is pending
or has been proposed with respect to any Benefit Plan, Employment Contract
or Title IV Plan.
(i) Additional Payments. The Merger will not result in any
-------------------
additional payments to, or increase the vested interest of, any current or
former officer, employee or director or their dependents under any Benefit
Plan or Employment Contract.
(j) Section 280G. The transactions contemplated by this Agreement
------------
and the Transaction Documents will not result in any payments to any
current or former officer, employee or director of Lichtin Properties which
will be subject to Section 280G of the Code.
For purposes of this Section 2.12, "ERISA" means the Employee Retirement
Income Security Act of 1974, as amended from time to time, and any
regulations or published rulings promulgated or issued thereunder; and
"ERISA Affiliate" means any trade or business (whether incorporated or
unincorporated) which is a member of a group described in Section 414(b),
(c), (m) or (o) of the Code, of which Lichtin Properties is also a member.
2.13. Title to Assets. Lichtin Properties is the sole owner of and holds
----------------
good, valid and marketable title to its assets, free and clear of any and all
claims, liens, pledges, security interests, and other encumbrances of any kind,
except as otherwise disclosed on Schedule 2.07.
-------------
-6-
<PAGE>
2.14. Investment.
-----------
(a) Harold S. Lichtin is acquiring the Shares for his own account
and not with a view to, or for sale in connection with, a "distribution,"
as such term is used in Section 2(11) of the Securities Act of 1933, as
amended (the "Securities Act"), of any of the Shares in violation of the
Securities Act.
(b) Harold S. Lichtin is an "accredited investor," as that term is
defined in Rule 501(a) of Regulation D promulgated under the Securities
Act.
(c) Harold S. Lichtin understands that the Shares have not been
registered under the Securities Act by reason of a specific exemption from
the registration provisions of the Securities Act which depends upon, among
other things, the nature of the investment intent and the accuracy of
Harold S. Lichtin's representations as expressed herein.
2.15. Access to Data. Harold S. Lichtin has had an opportunity to discuss
--------------
Weeks' business, management and financial affairs with Weeks' management and has
had an opportunity to review Weeks' financial records.
2.16. Experience; Risk. Harold S. Lichtin has such knowledge and
-----------------
experience in financial and business matters that he is capable of evaluating
the merits and risks of the purchase of the Shares pursuant to this Agreement
and of protecting his interests in connection herewith.
2.17. Capital Stock. The authorized capital stock of Lichtin Properties
-------------
consists solely of 100,000 shares of common stock, par value $1 per share, of
which 100 shares are issued and outstanding and Harold S. Lichtin is the sole
owner thereof. Such outstanding shares are duly authorized, validly issued,
fully paid and nonassessable. There are no outstanding options, warrants or
convertible securities with respect to the capital stock of Lichtin Properties.
2.18. Books and Records. The corporate records of Lichtin Properties made
-----------------
available to Weeks prior to the execution of this Agreement are true and correct
and have been maintained in accordance with good business practices, and the
matters contained therein are appropriately and accurately reflected in the
financial statements of Lichtin Properties.
2.19. Environmental. To the knowledge of Lichtin Properties, Lichtin
-------------
Properties and each of its affiliates are in compliance in all material respects
with all statutes, regulations and ordinances relating to the protection of
human health and the environment including, without limitation, the Clean Water
Act, 33 U.S.C. (S) 1251 et seq., the Resource Conservation and Recovery Act, 42
------
U.S.C. (S) 6901 et seq., the Clean Air Act, 42 U.S.C. (S) 7401 et seq., the
------ ------
Toxic Substances Control Act, 15 U.S.C. (S) 2601 et seq., the Emergency Planning
------
and Community Right-to-Know Act, 42 U.S.C. (S) 11001 et seq., the regulations
------
developed pursuant to these statutes and the corresponding state and local
statutes, ordinances and regulations. There has been no release by Lichtin
Properties or its affiliates or by any other person of a hazardous substance as
that term is defined in the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, 42 U.S.C. (S) 9601(14), into the environment at any
property owned or leased by Lichtin Properties or its affiliates (the
-7-
<PAGE>
"Premises") including, without limitation, any such release in the soil or
groundwater underlying the Premises. To the knowledge of Lichtin Properties,
there is no asbestos, polychlorinated biphenyls or underground storage tanks
located on the Premises and there have been no releases of asbestos,
polychlorinated biphenyls or materials stored in underground storage tanks,
including, without limitation, petroleum or petroleum-based materials. To the
knowledge of Lichtin Properties, neither Lichtin Properties nor any of its
affiliates has received notice of any violation of any environmental statute or
regulation by Lichtin Properties or any of its affiliates nor has it been
advised of any claim or liability pursuant to any environmental statute or
regulation brought by any governmental agency or private party against Lichtin
Properties or any of its affiliates.
2.20. Woodlake and Paramount Options. To the knowledge of Harold S.
------------------------------
Lichtin without any inquiry, each of Pitcairn Group, L.P., a Delaware limited
partnership ("Pitcairn"), Investors of the Triangle Limited Partnership, a North
Carolina limited partnership ("Investors"), Everett Properties Limited
Partnership, a North Carolina limited partnership ("Everett"), and the
respective general partners and other persons which have recourse liability with
respect to each of Pitcairn, Triangle and Everett, is solvent, has not made a
general assignment for the benefit of its creditors, and has not admitted in
writing its inability to pay its debts as they become due; nor, to the knowledge
of Lichtin without any inquiry, has any of Pitcairn, Triangle, Everett or the
respective general partners or other persons which have recourse liability with
respect to each of Pitcairn, Triangle and Everett filed, nor to the knowledge of
Harold S. Lichtin without any inquiry, does any such person contemplate the
filing of, any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings, or any other proceeding for the relief of debtors in
general, nor to the knowledge of Harold S. Lichtin without any inquiry, has any
such proceeding been instituted by or against any of Pitcairn, Triangle or
Everett or the respective general partners or other persons which have recourse
liability with respect to each of Pitcairn, Triangle and Everett, nor is any
such proceeding, to Harold S. Lichtin's knowledge, threatened or contemplated.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF WEEKS
Weeks represents and warrants to, and agrees with, Lichtin Properties and
Harold S. Lichtin as follows:
3.01. Organization; Authority. Weeks is a corporation duly formed,
-----------------------
validly existing and in good standing under the laws of the State of Georgia and
has all the necessary power and authority to enter into and perform its
obligations under this Agreement.
3.02. Due Authorization; Binding Agreement. The execution, delivery and
------------------------------------
performance of this Agreement by Weeks has been duly and validly authorized by
all necessary action of Weeks. This Agreement has been duly executed and
-8-
<PAGE>
delivered by Weeks and constitutes a legal, valid and binding obligation of
Weeks, enforceable against Weeks in accordance with the terms hereof (except as
enforcement may be limited by bankruptcy, insolvency or other laws affecting
enforcement of creditors' rights generally and general equity principles).
3.03. No Violation. None of the execution, delivery and performance of
------------
this Agreement by Weeks does or will, with or without the giving of notice,
lapse of time or both, (i) violate, conflict with or constitute a default under
any term or condition of (A) the Articles of Incorporation or Bylaws of Weeks,
or (B) any term or provision of any judgment, decree, order, statute,
injunction, rule or regulation of a governmental unit applicable to Weeks or any
agreement, contract, mortgage, indenture, lease, reciprocal easement or
operating agreement or other arrangement to which Weeks is a party or by which
it is bound or to which any of its assets is subject, except in the case where
appropriate waivers and consents have been obtained prior to the date hereof,
and except as would not have a material adverse effect on Weeks, or (ii) result
in the creation of any lien or other encumbrance upon the assets of Weeks,
except as may be contemplated by this Agreement, and except as would not have a
material adverse effect on Weeks or its assets.
3.04. Litigation. Except as set forth on Schedule 3.04, attached hereto,
---------- -------------
there are no claims, actions, suits, proceedings or investigations pending, or,
to Weeks' knowledge, threatened, before any court, governmental unit, agency,
arbitrator, or other forum or tribunal with respect to the assets of Weeks
which, if adversely determined, would have a material adverse effect on the
assets of Weeks.
3.05. Financial Statements; Material Changes. The unaudited financial
--------------------------------------
statements of Weeks as of and for the period ended September 30, 1996 are true,
correct and complete in all material respects and have been prepared in
accordance with generally accepted accounting principles and present fairly the
financial condition of Weeks at, and the consolidated results of operations for
the periods ending on, such date, and since such date there has been no material
adverse change in the financial position of Weeks. Since the date of the
unaudited financial statements referred to above and except as set forth on
Schedule 3.05 attached hereto, (i) there has been no material adverse change in
- -------------
or affecting, or any event which, with the passing of time or the giving of
notice, would affect, the financial condition, results of operations or business
of Weeks, whether or not arising in the ordinary course of business; (ii) there
has been no material casualty loss or material condemnation or other material
adverse event with respect to any of the properties or assets of Weeks; (iii)
there have been no transactions or acquisitions entered into by Weeks other than
those in the ordinary course of business and that are not material to Weeks; and
(iv) there has been no material change in the capital stock of Weeks or any
material increase in the indebtedness of Weeks.
3.06. REIT Qualification. Weeks is organized and operates in a manner
------------------
so as to qualify as a "real estate investment trust" under Sections 856 through
860 of the Code.
-9-
<PAGE>
ARTICLE IV
COVENANTS AND AGREEMENTS
4.01. Further Assurances. In addition to the actions, contracts and other
------------------
agreements and documents and other papers specifically required to be taken or
delivered pursuant to this Agreement, each of the parties hereto shall execute
such contracts and other agreements and documents and take such further actions
as may be reasonably required or desirable to carry out the provisions hereof
and the Merger.
4.02. Employee Matters. Weeks is entitled to offer employment to any and
----------------
all employees of Lichtin Properties, and Lichtin Properties shall in no way
hinder or impede Weeks from soliciting the employment of any employee of Lichtin
Properties. Nothing contained herein is intended to limit Weeks's ability to
terminate or modify the terms of employment of any employee of Lichtin
Properties who accepts employment with Weeks. Lichtin Properties shall be
obligated to discharge and satisfy all obligations, liabilities, demands,
claims, assessments and expenses related to any employee of Lichtin Properties
which accrued prior to the Effective Date, and Weeks shall have no liability
whatsoever in that connection. After the Effective Date, Weeks shall be
obligated to discharge and satisfy all obligations, liabilities, demands,
claims, assessments and expenses which relate to any facts or circumstances
first occurring on or after the Effective Date related to those employees of
Lichtin Properties which Weeks decides to employ, and Lichtin Properties shall
have no liability whatsoever in that connection.
4.03. Tax Return. Weeks shall be responsible for preparing and filing the
-----------
final tax return for Lichtin Properties; provided, however, Harold S. Lichtin
-------- -------
and his representative shall be entitled to participate in the preparation and
filing of such final tax return. Harold S. Lichtin shall make available to
Weeks all records and documents necessary for Weeks to prepare such return and
shall reimburse Weeks for all reasonable costs and expenses incurred in
connection with the preparation and filing of such return.
ARTICLE V
INDEMNIFICATION
5.01. Survival; Reliance. The representations, warranties, covenants and
------------------
agreements made by each of the parties hereto are true and correct as of the
Effective Date and shall survive the Merger, and each party hereto has the right
to fully rely on the representations, warranties, covenants and agreements made
by the other party; provided, however, that the representations, warranties,
covenants and agreements made by each of the Lichtin Parties shall survive the
Merger only as provided in Paragraph 9 of the Second Amendment.
-10-
<PAGE>
5.02. Indemnification. In the event Weeks breaches any representation,
----------------
warranty, covenant or agreement contained herein, Weeks agrees to indemnify and
hold harmless each Lichtin Party from all liabilities, demands, claims, actions,
assessments, losses, fines, penalties, costs, damages and expenses (including,
without limitation, reasonable attorneys' and accountants' fees and expenses)
sustained or incurred by such Lichtin Party as result of such breach. The
liability of the Lichtin Parties for a breach of any representation, warranty,
covenant or agreement contained herein shall be governed by Paragraphs 9, 10, 11
and 12 of the Second Amendment.
ARTICLE VI
MISCELLANEOUS
6.01. Fees and Expenses; Transfer Taxes. Fees and expenses incident to
---------------------------------
the negotiation, preparation and execution of this Agreement and the
consummation of the Merger (including attorneys', accountants', financial
advisors' and other advisors' fees and disbursements) shall be borne by the
party incurring the expense.
6.02. Notices. Any notice or other communication required or that may be
--------
given hereunder shall be in writing and shall be delivered personally, or sent
by certified, registered, or express mail, postage prepaid, to the parties at
the following addresses or such other addresses as shall be specified by the
parties by like notice, and shall be deemed given when so delivered personally,
or if mailed, three days after the date of mailing, as follows:
(i) If to Weeks:
Weeks Corporation
4497 Park Drive
Norcross, Georgia 30093
Attention: Thomas D. Senkbeil
Vice Chairman and Chief Investment Officer
with a copy to:
King & Spalding
191 Peachtree Street
Atlanta, Georgia 30303
Attention: William B. Fryer, Esq.
-11-
<PAGE>
(ii) If to either of the Lichtin Parties:
1800 Perimeter Park Drive
Suite 200
Morrisville, North Carolina 27560
Attention: Mr. Harold S. Lichtin
with a copy to:
Kennedy Covington Lobdell & Hickman, L.L.P.
Two Hanover Square
Suite 1900
434 Fayetteville Street Mall
Raleigh, North Carolina 27602-1070
Attention: Alan Peterson, Esq.
6.03. Entire Agreement. This Agreement and the Transaction Documents (as
----------------
defined in the Second Amendment) constitute the entire agreement among the
parties with respect to the subject matter hereof and supersedes all prior
contracts, agreements undertakings and understandings, express or implied,
written or oral, between the parties, or any of them, with respect to the
subject matter hereof and, except as otherwise expressly provided herein, is not
intended to confer upon any other person any rights or remedies hereunder.
6.04. Waivers and Amendments. This Agreement may be amended, modified,
----------------------
superseded, canceled, renewed or extended, and the terms and conditions hereof
may be waived, only by a written instrument signed by the parties hereto.
6.05. Governing Law. This Agreement shall be governed by, and construed
--------------
and enforce in accordance with and subject to, the laws of the State of Georgia,
without regard to principles of conflicts of law.
6.06. Binding Effect; Benefit. This Agreement shall inure to the benefit
------------------------
of and be binding upon the parties hereto and their respective successors and
assigns. Nothing in this Agreement, expressed or implied, is intended to confer
on any person other than the parties hereto or their respective successors and
assigns, any rights, remedies, obligations or liabilities under or by reason of
this Agreement.
6.07. No Assignment. This Agreement is not assignable (by operation of
-------------
law or otherwise) without the prior written consent of the other party.
6.08. Counterparts. This Agreement may be executed in two or more
------------
counterparts, each of which shall be deemed an original but all of which taken
together shall constitute one and same instrument.
-12-
<PAGE>
6.09. Headings. The headings in this Agreement are for reference purposes
--------
only and shall not in any way affect the meaning or interpretation of this
Agreement.
6.10. Registration Rights and Lock-Up Agreement. Harold S. Lichtin
-----------------------------------------
acknowledges and agrees that the Shares shall be subject to the provisions of
that certain Registration Rights and Lock-Up Agreement dated as of even date
herewith between Weeks and the Lichtin Holders identified therein.
-13-
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement and Plan of
Merger as of the date first above written.
LICHTIN PROPERTIES, INC.
By:
-------------------------------------
Name:
Title:
HAROLD S. LICHTIN
----------------------------------------
WEEKS CORPORATION
By:
-------------------------------------
Name:
Title:
-14-
<PAGE>
SCHEDULE 2.07
-------------
1. That certain Lease Agreement dated October 27, 1993 between Licthin
Properties, Inc., as Lessee, and Data General Corporation, as Lessor,
being lease number 12498-001 respecting certain software and computer
equipment, which liability shall be assumed by Weeks Corporation as a
result of the Merger.
2. Lichtin Properties, Inc. has various trade payables respecting its
operations through December 31, 1996, which obligations shall be the
responsibility of and shall be paid by Harold S. Lichtin as soon as
practicable to the extent that the same relate to operations on or
prior to December 31, 1996.
3. Lichtin Properties, Inc. is obligated to make a contribution to the
Lichtin Properties, Inc. 401(k) Plan to satisfy the minimum funding
requirements of the "top-heavy" rules under Section 416 of the
Internal Revenue Code of 1986, as amended, which obligation will be
the responsibility of and shall be paid by Harold S. Lichtin as
provided in the Closing Statement of even date herewith relating to
certain transactions of which the Merger is a part.
<PAGE>
SCHEDULE 3.04
-------------
On December 12, 1996, Gwinco-Gary Joint Venture, a Georgia partnership,
filed a complaint in the Superior Court of Gwinnett County, Georgia. The
complaint names Weeks Horizon Corporation and the Company as defendants. The
action stems from the development of property in Gwinnett County, Georgia, known
as the Horizon Industrial Park. Gwinco-Gary alleges breaches of fiduciary duty
for an alleged failure to consummate sales with ready, willing and able buyers,
and seeks $17.2 million in damages, an unknown amount of profits to be
disgorged, and $10 million in punitive damages.
<PAGE>
SCHEDULE 3.05
-------------
1. As more fully described in Weeks' Quarterly Report on Form 10-Q for the
period ended September 30, 1996, on November 1, 1996, Weeks completed the
first phase of its acquisition of the industrial building portfolio of NWI
Warehouse Group, L.P. and its affiliates.
2. As more fully described in Weeks' Quarterly Report on Form 10-Q for the
period ended September 30, 1996, on November 13, 1996, Weeks completed a
public offering of 2,573,333 shares of its common stock.
<PAGE>
CERTIFICATE OF MERGER OF
LICHTIN PROPERTIES, INC.
WITH AND INTO
WEEKS CORPORATION
I.
The names and the states of incorporation of the corporations that are
merging are Weeks Corporation ("Weeks"), a Georgia corporation, and Lichtin
Properties, Inc. ("LPI"), a North Carolina corporation. The name of the
surviving corporation is Weeks Corporation.
II.
The executed Agreement and Plan of Merger is on file at the principal place
of business of Weeks, which is located at 4497 Park Drive, Norcross, Georgia
30093.
III.
A copy of the executed Agreement and Plan of Merger will be furnished by
Weeks, on request and without cost, to any shareholder of any corporation that
is a party to the merger.
IV.
The merger was duly approved by the sole shareholder of LPI. The merger
was not required to be approved by the shareholders of Weeks.
V.
The surviving corporation undertakes that the request for publication of a
notice of filing of this Certificate of Merger and payment therefor will be made
as required by Section 14-2-1105.1(b) of the Official Code of Georgia Annotated.
<PAGE>
IN WITNESS WHEREOF, this Certificate of Merger has been executed by the
duly authorized officers of Weeks Corporation on this day of December,
-----
1996.
Weeks Corporation
By:
----------------------------------------
Name:
Title:
[CORPORATE SEAL]
ATTEST:
- -----------------------------
Secretary
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
CONTRIBUTION AGREEMENT
FOR
NORTHERN TELECOM PROPERTIES,
AMONG
"CONTRIBUTORS"
(AS HEREIN DEFINED)
AND
WEEKS REALTY, L.P.
DOING BUSINESS AS
WEEKS REALTY LIMITED PARTNERSHIP
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
-----------------
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
1. DEFINED TERMS......................................... 1
2. COVENANT TO CONTRIBUTE................................ 9
3. STRUCTURE OF CONTRIBUTION............................. 9
4. CONTRIBUTION DATE..................................... 10
5. CONTRIBUTION VALUE.................................... 11
6. ADJUSTED CONTRIBUTION VALUE........................... 11
7. CASH PAYMENTS AND ISSUANCE OF UNITS................... 12
8. INTERIM CONDUCT....................................... 13
9. EXISTING LOANS........................................ 14
10. TITLE AND SURVEY...................................... 16
11. DATE, TIME AND PLACE OF CONTRIBUTION.................. 16
12. COSTS AND EXPENSES; PREPARATION OF DOCUMENTS.......... 18
13. ACCESS TO AND EXAMINATION OF THE NORTHERN
TELECOM PROPERTIES.................................... 19
14. REPRESENTATIONS AND WARRANTIES OF
THE CONTRIBUTORS...................................... 19
15. REPRESENTATIONS AND WARRANTIES OF WEEKS............... 28
16. CONDITIONS............................................ 29
17. FIRE AND CASUALTY..................................... 31
18. EMINENT DOMAIN........................................ 32
</TABLE>
i
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
19. DEFAULT............................................... 33
20. BROKERAGE FEES........................................ 33
22. MISCELLANEOUS......................................... 34
</TABLE>
ii
<PAGE>
SCHEDULE OF EXHIBITS
EXHIBIT A Northern Telecom Properties
EXHIBIT B Existing Loans
EXHIBIT C Existing Loan Documents
EXHIBIT D Legal Descriptions of Land
EXHIBIT E Leasing Guidelines
EXHIBIT F Permitted Exceptions
EXHIBIT G Pro Forma Annual Operating Expense/Pro Forma Reimbursable
Amounts
EXHIBIT H Rent Roll
EXHIBIT I Tenant Estoppel Certificate Form
EXHIBIT J Schedule of Environmental Reports
EXHIBIT K Schedule of Pending or Threatened Litigation
EXHIBIT L Schedule of Engineering Reports
EXHIBIT M Schedule of Insurance Coverage
EXHIBIT N Schedule of Incomplete Improvements
EXHIBIT O Schedule of Service Contracts
EXHIBIT P Schedule of Commission Obligations
iii
<PAGE>
CONTRIBUTION AGREEMENT
(Northern Telecom Properties)
THIS CONTRIBUTION AGREEMENT (hereinafter referred to as this
"Agreement"), made and entered into as of this 31st day of December, 1996, by
and among the "CONTRIBUTORS" (as hereinafter defined); and WEEKS REALTY, L.P., a
Georgia limited partnership authorized to do business as WEEKS REALTY LIMITED
PARTNERSHIP (hereinafter referred to as "Weeks");
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, pursuant to the "Transaction Documents" (as defined in that
certain Contribution Agreement for Completed Properties, dated of even date
herewith), the Contributors and other contributors identified in the Transaction
Documents have agreed to contribute in stages certain assets, properties and
businesses to the capital of Weeks upon and subject to the terms and conditions
set forth in the Transaction Documents (hereinafter referred to as the
"Transaction");
WHEREAS, on even date herewith, the Contributors and other
contributors identified in the Transaction Documents contributed to the capital
of Weeks (hereinafter referred to as the "Initial Contribution") the "Completed
Properties" (as defined in that certain Contribution Agreement for Completed
Properties, dated as of even date herewith) in exchange for "Units" (as
hereinafter defined), cash and assumption (subject to the limitation on recourse
provisions) of certain indebtedness as one of the stages in the Transaction;
WHEREAS, as another stage of the Transaction, Contributors have agreed
to contribute, from time to time, each of the "Northern Telecom Properties" (as
hereinafter defined) to the capital of Weeks in exchange for the issuance of
additional Units, cash and the assumption (subject to the limitation on recourse
provisions) of certain indebtedness, as and when certain conditions are met, all
as more particularly set forth in this Agreement; and
WHEREAS, Weeks has agreed to accept such contribution of the Northern
Telecom Properties and, in connection therewith, issue Units and pay cash to the
Contributors and assume (subject to the limitations of recourse provisions)
certain liabilities, all as more particularly set forth in this Agreement.
NOW, THEREFORE, for and in consideration of the foregoing premises,
the mutual covenants and agreements herein set forth and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Contributors and Weeks hereby covenant and agree as follows:
1. DEFINED TERMS. In addition to terms defined elsewhere in this
-------------
Agreement, the following words, when used in this Agreement, shall have the
meanings ascribed thereto in this paragraph:
<PAGE>
a. "Adjusted Contribution Value" means the adjusted contribution value
---------------------------
for a Northern Telecom Property arrived at after making the
adjustments provided for in Paragraph 6 of this Agreement.
b. "Contribution" means the consummation of a contribution to the capital
------------
of Weeks of a Northern Telecom Property pursuant to the terms and
conditions of this Agreement; and "Contribute" means the making of a
----------
Contribution.
c. "Contribution Date", for each Northern Telecom Property, means the
-----------------
date on which that Northern Telecom Property is Contributed by the
Contributors to the capital of Weeks pursuant to Paragraph 4 of this
Agreement.
d. "Contribution Value" means the contribution value of a Northern
------------------
Telecom Property determined in accordance with Paragraph 5 of this
Agreement.
e. "Contributors" means, collectively, H.S. Lichtin, M.A. Robertson and
------------
PPW; and "Contributor" means any one of the Contributors.
f. "Environmental Laws" means the Resource Conservation and Recovery Act
------------------
(42 U.S.C. (S) 6901 et seq.), as amended by the Hazardous Materials
-- ---
Transportation Act (490 U.S.C. (S) 1801 et seq.); the Toxic Substance
-- ---
Control Act (15 U.S.C. (S) 2601 et seq.); Clean Air Act U.S.C. (S) 136
-- ---
et seq.); the Occupational Safety and Health Act (29 U.S.C. (S) 651 et
-- --- --
seq.) and all applicable federal, state and local environmental laws,
---
including obligations under the common law, ordinances, rules and
regulations, as any of the foregoing may have been amended,
supplemented or supplanted prior to the date hereof, relating to
regulation or control of Hazardous Materials, or their handling,
storage or disposal or to environmental health and safety.
g. "Existing Loan" means one of the loans identified on Exhibit B,
-------------
attached hereto and by this reference made a part hereof; and
"Existing Loans" means, collectively, all of the loans identified on
--------------
Exhibit B hereto.
---------
h. "Existing Loan Documents" means, collectively, all of the loan
-----------------------
documents evidencing and securing an Existing Loan, as identified on
Exhibit C, attached hereto and by this reference made a part hereof.
---------
i. "Gross Income", for the purpose of determining the Contribution Value
of a Northern Telecom Property and subject to certain adjustments and
deductions expressly provided in this definition, means the sum of the
-2-
<PAGE>
gross rental income, including applicable Pro Forma Reimbursable
Amounts, scheduled to be paid by each Tenant under its Lease for the
twelve (12) month period commencing on the Contribution Date, subject
to the following:
i. If Tenant rent free concessions for a Lease exceed (A) three
(3) months for a Lease that has an original term of at least
five (5) years, or (B) one (1) month for a Lease that has an
original term of less than five (5) years (in either case,
such excess, the "Excess Tenant Concessions"); then, the
amount included in determining Gross Income from this Lease
shall equal the dollar amount derived from the following
formula:
(A) [(B - C) /B] = D
where in the foregoing formula:
A = gross rental income, including applicable
Pro Forma Reimbursable Amounts, scheduled to be paid
under the Lease for the twelve (12) month period
commencing on the Contribution Date;
B = total gross rental income, including applicable Pro
Forma Reimbursable Amounts, scheduled to be paid under
the Lease for the original term of the Lease,
calculated without regard to Excess Tenant
Concessions;
C = total value of the Excess Tenant Concessions for the
initial term of the Lease; and
D = amount to be included in Gross Income from the Lease.
ii. If the allowance for tenant finish exceeds Ten Dollars ($10.00)
per square foot below hung ceiling for any Lease (excluding the
Northern Telecom Lease) in a Northern Telecom Property, for the
purpose of determining Gross Income from that Northern Telecom
Property, the rental income attributable to the twelve (12) month
period commencing on the Contribution Date shall be reduced by
the amount attributable to that twelve (12) month period for
amortization of such excess tenant allowance and lease
commissions on that excess tenant allowance. For this purpose,
the amortization shall be computed by treating the amount of the
excess tenant allowance and related commission cost as a loan to
Tenant having a term equal to the original term of the Lease and
bearing interest at a simple interest rate per annum of ten and
-3-
<PAGE>
one-quarter percent (10.25%) to be repaid in equal monthly
installments of principal and interest over the original term of
the Lease.
j. "Hazardous Materials" means (i) those substances included within
-------------------
definitions of or identified as "hazardous substances," "hazardous
materials," or "toxic substances" in or pursuant to Environmental
Laws; (ii) those substances listed in the United States Department of
Transportation Table (40 CFR 172.101 and amendments thereto) or by the
Environmental Protection Agency (or any successor agency) as hazardous
substances (40 CFR Part 302 and amendments thereto); (iii) any
material, waste or substance which is or contains (A) petroleum,
including crude oil or any fraction thereof, natural gas or synthetic
gas usable for fuel or any mixture thereof, or any product containing
the foregoing substances, (B) asbestos or asbestos containing
material, (C) polychlorinated biphenyls, (D) any substance designated
as "hazardous substance" pursuant to Section 311 of the Clean Water
Act, 33 U.S.C. (S) 1251 et seq. (33 U.S.C. (S) 1321), or listed
-- ---
pursuant to Section 307 of the Clean Water Act (33 U.S.C. (S) 1317);
(E) flammable explosives; (F) radioactive materials; and (iv) such
other substances, materials and wastes which are or become regulated
as hazardous, toxic or "special wastes" under Environmental Laws.
k. "H.S. Lichtin" means Harold S. Lichtin, an individual resident of
------------
North Carolina.
l. "Improvements" means all buildings, structures and other improvements,
------------
including such fixtures as constitute real property, located on the
Land.
m. "Intangible Personal Property" means any intangible personal property
----------------------------
now or hereafter owned by Project Entity in connection with the Land,
the Improvements or the Tangible Personal Property, and all of Project
Entity's rights under all contracts, utility arrangements, and other
agreements relating to the ownership, operation and occupancy thereof,
including, without limitation, warranties from contractors on the
Improvements, roof warranties, equipment warranties, the Leases and
Service Contracts; provided, however, the term "Intangible Personal
-------- -------
Property" does not include any cash on hand and in bank accounts,
notes receivable, accounts receivable (except as provided in Paragraph
11) rights under pending litigation, any rights to the name "Lichtin
Properties, Inc.", and any prepaid insurance premiums.
n. "Land" means those certain tracts or parcels of real property located
----
in Wake County, North Carolina, and containing approximately 33.4
acres, in the aggregate, as more particularly described in Exhibit D,
---------
attached hereto and by this reference made a part hereof, together
with all of Project Entity's right, title and interest in and to all
appurtenances, rights, easements, tenements and hereditaments incident
thereto.
-4-
<PAGE>
o. "Lease" means any lease or occupancy agreement affecting the Northern
-----
Telecom Properties.
p. "Leasing Guidelines" means the leasing guidelines set forth on Exhibit
------------------
E, attached hereto and by this reference made a part hereof.
q. "Lender" means the holder of an Existing Loan.
------
r. "Liens" means any liens, security interests, mortgages, deeds of
-----
trust, charges, claims, encumbrances, pledges, options, rights of
first offer or first refusal and any other rights or interests of
others of any kind or nature, actual or contingent, or other similar
encumbrances of any nature whatsoever.
s. "M.A. Robertson" means Marie Antoinette Robertson, an individual
--------------
resident of Texas.
t. "Net Operating Income", for the purposes of determining the
--------------------
Contribution Value of a Northern Telecom Property as of its
Contribution Date, means (i) Vacancy Adjusted Gross Income; less (ii)
Operating Expenses.
u. "Non-Vacated Northern Telecom Property" means any Northern Telecom
-------------------------------------
Property for which Northern Telecom has not elected on or before June
30, 1997, to exercise its early termination option with respect to all
or any portion of the space it leases in that Northern Telecom
Property.
v. "Northern Telecom" means Northern Telecom Inc., a Delaware
----------------
corporation.
w. "Northern Telecom Lease" means that certain Lease Agreement, dated
----------------------
June 20, 1995, by and between Perimeter Park Associates, a North
Carolina general partnership and predecessor to Project Entity, as
Landlord therein, and Northern Telecom Inc., a Delaware corporation,
as Tenant therein, pursuant to which Northern Telecom leases all of
the Northern Telecom Properties.
x. "Northern Telecom Property" means the Real Property, the Tangible
Personal Property and the Intangible Personal Property located at,
attributable to or used in connection with one of the six (6) projects
identified on Exhibit A, attached hereto and by this reference made a
---------
part hereof; and Northern Telecom Property and the Intangible Personal
-------------------------
Property located at, attributable to or used in connection with all of
the six (6) projects identified on Exhibit A hereto. Any reference to
---------
a specific Northern Telecom Property shall be made by incorporating
the name of the project as set forth on Exhibit A; for example, a
---------
specific reference to the first listed Northern Telecom Property shall
be the "100 Perimeter Park Property".
-5-
<PAGE>
y. "Operating Expenses", for the purposes of determining the Contribution
------------------
Value of a Northern Telecom Property, means the applicable Pro Forma
Annual Operating Expense for the twelve (12) month period commencing
on the Contribution Date for that Northern Telecom Property. Operating
Expenses also shall include, without limitation, (i) a management fee
equal to the greater of (A) four percent (4%) (or such other
percentage as is contractually agreed in a Lease for the gross rental
income from that Lease) of Vacancy Adjusted Gross Income (but not
including reimbursables) for the twelve (12) month period commencing
on the Contribution Date for that Northern Telecom Property or (B)
fifty-eight cents ($.58) per annum per square foot of area, (ii) an
owner's expense reimbursement charge of forty-two cents ($.42) per
annum per square foot of area, and (iii) a reserve for expenses in the
amount of eight cents ($.08) per annum per square foot of area.
z. "Partnership Amendment" means that certain Second Amendment to Second
---------------------
Amended and Restated Agreement of Limited Partnership, dated of even
date herewith, pursuant to which H.S. Lichtin and M.A. Robertson,
among others, are admitted as limited partners to Weeks.
aa. "Permitted Exceptions" means those matters set forth in Exhibit F,
--------------------
attached hereto and by this reference made a part hereof, together
with any matter expressly approved by Weeks pursuant to this
Agreement.
bb. "PPW" means Perimeter Park West Associates Limited Partnership, a
---
North Carolina limited partnership having H.S. Lichtin and M.A.
Robertson as its General Partners.
cc. "Pro Forma Annual Operating Expense" means the pro forma annual
----------------------------------
operating expense set forth on Exhibit G, attached hereto and by this
---------
reference made a part hereof.
dd. "Pro Forma Reimbursable Amounts" means the pro forma reimbursable
------------------------------
amounts also set forth on said Exhibit G hereto.
---------
ee. "Project Entity" means NTP Limited Partnership, a North Carolina
--------------
limited partnership, having H.S. Lichtin and M.A. Robertson as its
General Partners, as to the 200 Perimeter Park Property, the 400
Perimeter Park Property and the 800 Perimeter Park Property; Perimeter
Park Associates, a North Carolina general partnership having H.S.
Lichtin and M.A. Robertson as its sole General Partners, as to 100
Perimeter Park Property, the 300 Perimeter Park Property and the 500
Perimeter Park Property; and, as to any Vacated Northern Telecom
Property, any new Project Entity formed pursuant to Paragraph 3b of
-6-
<PAGE>
this Agreement from and after the date of formation and conveyance of
that Vacated Northern Telecom Property thereto.
ff. "Real Property" means collectively, the Land and the Improvements.
-------------
gg. "Rent Roll" means any and all Leases containing, with respect to each
---------
Lease, information as to the commencement date of such Lease, the
termination date of such Lease, any renewal rights or expansion rights
under such Lease, the approximate square footage of the leased
premises under such Lease, the annual base rental and additional rent
due under such Lease, and the amount and duration of any rent or other
concessions made to the Tenant under such Lease. The Rent Roll
attached hereto as Exhibit H and by this reference made a part hereof,
---------
sets forth the status of leasing at the Northern Telecom Properties as
of the date hereof.
hh. "Rights Agreements", collectively, means that certain Registration
-----------------
Rights and Lock-Up Agreement and that certain Registration Rights and
Lock-Up Agreement for Post-June 30, 1998 Shares and Units, both dated
of even date herewith and both by and among Weeks and H.S. Lichtin,
M.A. Robertson and certain other contributors identified in the
Transaction Documents.
ii. "Service Contracts" means any and all of the service contracts,
-----------------
equipment, labor or material contracts, management contracts,
maintenance or repair contracts, personal property leases or other
agreements (other than the Leases and related lease commission
agreements) entered into by Project Entity (or its predecessors) and
that are in force and effect and that affect the Northern Telecom
Properties or the operation, repair, or maintenance thereof.
jj. "Security Deposits" means the refundable deposits (in the form of
-----------------
cash, letters of credit or certificates of deposit) made by Tenants
with Project Entity as security for such Tenants' obligations under
their respective Leases, to the extent not previously forfeited,
applied or refunded, together with interest thereon accrued as of the
Contribution Date which Project Entity is obligated to pay to any such
Tenants.
kk. "Stabilization", with reference to a specific Northern Telecom
-------------
Property, means that all of the following conditions have been met:
(i) ninety-five percent (95%) of the net leasable area of the
Improvements have been leased to creditworthy Tenant(s) approved by
Weeks under Lease(s) approved by Weeks (which will base its approval
on commercially reasonable standards); (ii) Tenant(s) are in actual
possession and have accepted possession of ninety-five percent (95%)
of the net leasable area of the Improvements; (iii) except for free-
rent periods expressly stipulated in the Lease(s), rental shall have
commenced on ninety-five percent (95%) of the net leasable area of the
-7-
<PAGE>
Improvements and all other concessions (besides any free rent periods)
shall have expired; (iv) no default by Project Entity or any Tenant is
then outstanding and uncured under the Lease(s), and (v) all of
matters described in the foregoing four (4) clauses have been
confirmed to Weeks by the Tenant(s) pursuant to Tenant Estoppel
Certificate(s). For the purposes this definition, the Contributors
and Weeks agree that the net leasable area of the Improvement in each
Northern Telecom Property is that set forth on Exhibit A hereto.
---------
ll. "Tangible Personal Property" means all tangible personal property
--------------------------
located on the Real Property which is owned by Project Entity and used
in the ownership, operation and maintenance of the Land and
Improvements, including, without limitation, all art, furniture,
furnishings, fixtures and equipment and stock for completion of Tenant
improvements.
mm. "Tenant" means any Tenant or lessee under any of the Leases.
------
nn. "Tenant Estoppel Certificate" means the certificate to be submitted
---------------------------
for execution to each Tenant with respect to the Lease pursuant to
which such Tenant leases space in the Improvements, such certificate
to be in the form attached hereto as Exhibit I and incorporated herein
---------
by this reference.
oo. "To Contributors' Knowledge" means to the current actual knowledge of
--------------------------
H.S. Lichtin, James C. Little, Robert G. Yelverton and Carol R. Wood.
pp. "Total Potential Gross Income", for the purpose of determining Vacancy
----------------------------
Adjusted Gross Income, means at the Contribution Date the sum of (i)
Gross Income, and (ii) the amount of Gross Income (including Pro Forma
Reimbursable Amounts) that would accrue from all vacant space in a
Northern Telecom Property if such vacant space were leased at the
rental rates specified in the Leasing Guidelines, and assuming a term
of less than 10 years, with no adjustment for Excess Tenant
Concessions or excess office finish and related Lease commissions.
qq. "Units" means limited partnership units in Weeks Realty, L.P., as
-----
described in the Rights Agreements.
rr. "Unit Price" means (i) for Contributions of the Non-Vacated Northern
----------
Telecom Properties, the arithmetic average, rounded to the nearest
one-eighth (1/8), of the daily closing price of a share of common
stock of Weeks Corporation on the New York Stock Exchange for the
twenty (20) trading days immediately prior to July 1, 1997; provided,
however, if such average is less than Twenty-Five Dollars and Twenty-
Five Cents ($25.25), the Unit Price shall be Twenty-Five Dollars and
Twenty-Five Cents ($25.25) and, if such average exceeds Twenty-Seven
Dollars ($27.00), the Unit Price shall be Twenty-Seven Dollars
-8-
<PAGE>
($27.00); and (ii) for Contribution of a Vacated Northern Telecom
Property, the arithmetic average, rounded to the nearest one-eighth
(1/8), of the daily closing price of a share of common stock of Weeks
Corporation on the New York Stock Exchange for the twenty (20) trading
days immediately prior to the Contribution Date for that Vacated
Northern Telecom Property. The Unit Price set forth in clause (i) of
the immediately preceding sentence is a negotiated amount for the
purposes of this Agreement and does not reflect a valuation by the
Contributors or Weeks of Weeks Corporation or Weeks.
ss. "Vacancy Adjusted Gross Income", to adjust for possible future
-----------------------------
vacancy, for each Northern Telecom Property as of the Contribution
Date, means the following:
i. If on the Contribution Date, less than ninety-five percent
(95%) of the space in such Northern Telecom Property is
leased, then the Vacancy Adjusted Gross Income shall equal
the Gross Income.
ii. If on the Contribution Date, at least ninety-five percent
(95%) of the space in such Northern Telecom Property is
leased, then the Vacancy Adjusted Gross Income shall be
the lesser of:
(1) Gross Income of that Northern Telecom Property; or
(2) ninety-five percent (95%) of Total Potential Gross
Income of that Northern Telecom Property, plus an
amount equal to five percent (5.0%) of the Gross
Income attributable to leases having a term of ten
years or more.
2. COVENANT TO CONTRIBUTE. The Contributors hereby covenant and agree to
----------------------
contribute the Northern Telecom Properties to the capital of Weeks pursuant to
the structure outlined in Paragraph 3 of this Agreement and in accordance with,
and subject to, the terms and conditions of this Agreement. Weeks hereby
covenants and agrees to accept Contribution of the Northern Telecom Properties
to its capital pursuant to the structure outlined in Paragraph 3 of this
Agreement and in accordance with, and subject to, the terms and conditions of
this Agreement.
3. STRUCTURE OF CONTRIBUTION. Subject to the other terms and conditions
-------------------------
of this Agreement, the Contribution of the Northern Telecom Properties shall be
structured as follows:
a. With respect to the Non-Vacated Northern Telecom Properties, the following
shall take place: (i) on the Contribution Date immediately prior to
Contribution, the Vacated Northern Telecom Properties shall be conveyed to
one or more newly formed limited partnerships each having the Contributors
-9-
<PAGE>
as its partners (and thereafter, as to each Vacated Northern Telecom
Property, all references in this Agreement to a Project Entity shall mean
that newly formed limited partnership which owns that Vacated Northern
Telecom Property), (ii) on the Contribution Date, each of the Contributors
shall contribute to the capital of Weeks all general partnership interests
and limited partnership interests in the original Project Entity, (iii) in
exchange for the Contribution of ownership interests in that Project
Entity, as described in the immediately preceding clause (ii), Weeks shall
issue Units to the Contributors and make cash payments to, at the direction
of, or on behalf of the Contributors as provided in Paragraph 7, and (iv)
immediately following such Contribution as described in clause (ii) above,
on the Contribution Date, Weeks, as the sole owner of all ownership
interests in that Project Entity, shall dissolve that Project Entity and
all assets of that Project Entity, including the Non-Vacated Northern
Telecom Properties, shall be distributed in dissolution to, and become part
of the capital of, Weeks and the Existing Loans encumbering the Non-Vacated
Northern Telecom Properties shall be assumed by Weeks subject to the non-
recourse provisions thereof.
b. With respect to each Vacated Northern Telecom Property, the following shall
take place: (i) on the Contribution Date, each of the Contributors shall
contribute to the capital of Weeks all general partnership interests and
limited partnership interests in the Project Entity that owns that Vacated
Northern Telecom Property, (ii) in exchange for the Contribution of
ownership interests in that Project Entity, as described in the immediately
preceding clause (i), Weeks shall issue Units to the Contributors as
provided in Paragraph 7, (iii) PPW shall immediately distribute such Units
it received pursuant to clause (ii) above pro rata to its partners in
accordance with their respective ownership percentages in PPW, and (iv)
immediately following such Contribution as described in clause (i) above,
on the Contribution Date, Weeks, as the sole owner of all ownership
interests in that Project Entity, shall dissolve that Project Entity and
all assets of that Project Entity, including the Vacated Northern Telecom
Property, shall be distributed in dissolution to, and shall become part of
the capital of, Weeks and the Existing Loans encumbering that Vacated
Northern Telecom Property shall be assumed by Weeks subject to the non-
recourse provisions thereof.
c. Notwithstanding the provisions of Paragraph 3a and 3b above to the
contrary, the Contributors may elect to cause the Contribution of a
Northern Telecom Property to be made by general warranty deed from the
Project Entity to Weeks.
4. CONTRIBUTION DATE. The Contribution Date for the Northern Telecom
-----------------
Property shall be established as follows:
-10-
<PAGE>
a. The Contributors shall Contribute the Non-Vacated Northern Telecom
Properties to Weeks pursuant to this Agreement on July 1, 1997, which date
shall be the Contribution Date for the Non-Vacated Northern Telecom
Properties.
b. Each of the Vacated Northern Telecom Properties shall be Contributed by the
Contributors to Weeks pursuant to this Agreement on the earlier of (i) June
30, 2000, or the (ii) date on which that Vacated Northern Telecom Property
achieves Stabilization, which date, in either case, shall be the
Contribution Date for that Vacated Northern Telecom Property.
5. CONTRIBUTION VALUE. The Contribution Value of a Northern Telecom
------------------
Property shall be determined as of its Contribution Date in accordance with the
following:
a. For each Non-Vacated Northern Telecom Property, the Contribution Value
shall equal the Net Operating Income of that Non-Vacated Northern Telecom
Property determined as of its Contribution Date divided by decimal one zero
four (.104).
b. For each Vacated Northern Telecom Property, the Contribution Value shall
equal the Net Operating Income of each Vacated Northern Telecom Property
determined as of its Contribution Date divided by decimal one zero five
(.105).
c. Notwithstanding the provisions of Paragraph 5a and 5b to the contrary, if
all of the Northern Telecom Properties are to be contributed on July 1,
1997 (as a result of Northern Telecom's not exercising its early
termination option as to any space it leases in the Northern Telecom
Properties), the Contribution Value for all of the Northern Telecom
Properties in the aggregate shall be Twenty-Three Million Seven Hundred
Thousand Dollars ($23,700,000).
6. ADJUSTED CONTRIBUTION VALUE. After determination of the Contribution
---------------------------
Value of a Northern Telecom Property, such Contribution Value shall be subject
to the following further prorations, allocations and adjustments, all as of the
Contribution Date (the "Adjusted Contribution Value"):
a. If no adjustment to Gross Income has been made for free rent concessions
pursuant to the definition of Gross Income, the Contribution Value shall be
reduced by the amount of free rent concessions unexpired as of the
Contribution Date; provided, however, the Contributors may elect to make a
cash payment to Weeks for the amount of unexpired free rent concessions in
lieu of such adjustment.
b. If adjustment to Gross Income has been made for excess tenant allowance and
related lease commission pursuant to clause (ii) of the definition of Gross
Income, the Contribution Value shall be increased by the actual cost of the
-11-
<PAGE>
tenant allowance in excess of Ten Dollars ($10.00) per square foot and
related lease commissions.
c. If the Northern Telecom Property is to be contributed subject to an
Existing Loan in accordance with the terms and conditions of Paragraph 9 of
this Agreement, the Contribution Value shall be reduced by the outstanding
principal balance of that Existing Loan as of the Contribution Date.
d. Any reduction in the Contribution Value pursuant to Paragraph 9b iii of
this Agreement.
e. Any other adjustment to the Contribution Value for which express provision
is made in this Agreement
f. In the event that the Adjusted Contribution Value of a Vacated Northern
Telecom Property is less than the outstanding principal balance on the
Contribution Date of the Existing Loan that encumbers that Vacated Northern
Telecom Property, then the Contributors shall pay to Weeks on the
Contribution Date a cash payment equal to the excess of such outstanding
balance over the Adjusted Contribution Value and, for the purposes of
Paragraph 7c of this Agreement, no additional Units shall be issued to the
Contributors for Contribution of that Vacated Northern Telecom Property. In
lieu of such cash payment, the Contributors may elect to surrender and
return to Weeks without compensation a number of Units equal to the
quotient of such excess divided by the Unit Price. This obligation of the
Contributors to make this cash payment is joint and several and is secured
by the pledge of Units and Shares contained in the Partnership Amendments.
7. CASH PAYMENTS AND ISSUANCE OF UNITS. At Contribution, Weeks shall
-----------------------------------
make cash payments and issue Units to the Contributors as provided in this
Paragraph 7:
a. On the Contribution Date for the Non-Vacated Northern Telecom Properties,
Weeks shall wire transfer funds available for immediate credit to accounts
designated in writing by the Contributors, amounts not to exceed in the
aggregate, the lesser of (i) the Adjusted Contribution Value for the Non-
Vacated Northern Telecom Properties, or (ii) an amount equal to $10,000,000
less the cash payments made by Weeks to the contributors at Initial
Contribution. At Contribution, the Contributors shall designate to Weeks in
writing an allocation of this cash payment by Non-Vacated Northern Telecom
Property and, with respect to each Non-Vacated Northern Telecom Property,
by each Contributor.
b. For each Non-Vacated Northern Telecom Property, to the extent the Adjusted
Contribution Value exceeds the cash payments allocated to that Non-Vacated
-12-
<PAGE>
Northern Telecom Property pursuant to Paragraph 7a of this Agreement, on
the Contribution Date, Weeks shall issue to each of the Contributors, pro
rata in accordance with their respective ownership interests in the Project
Entity, a number of Units equal to the quotient of such excess divided by
the Unit Price.
c. For each Vacated Northern Telecom Property, on the Contribution Date, Weeks
shall issue to each of the Contributors, pro rata in accordance with their
respective ownership interests in the Project Entity, a number of Units
equal to the quotient of the Adjusted Contribution Value divided by the
Unit Price.
d. Units issued by Weeks to the Contributors pursuant to this Agreement shall
be held by the Contributors subject to the terms and conditions of the
Partnership Amendment and the applicable Rights Agreements.
e. Notwithstanding any provision of this Agreement to the contrary, no
fractional Units shall be issued to the Contributors pursuant to this
Agreement. If as a result of the application of the foregoing formulas, a
fractional Unit is due any Contributor, Weeks shall pay to that
Contributor, in cash on the same date as the fractional Unit would
otherwise be issued and in lieu of any such fractional Unit, an amount
equal to that fractional Unit times the applicable Unit Price, as
determined pursuant to this Agreement.
8. INTERIM CONDUCT.
---------------
a. The Contributors hereby covenant and agree with Weeks that, so long as this
Agreement remains in full force and effect, the Contributors will not
permit any Project Entity to sell, assign, rent, lease, convey (absolutely
or as security), grant a security interest in, or otherwise encumber or
dispose of, the Northern Telecom Properties (or any interest or estate
therein) without the prior written consent of Weeks; provided, however, a
Project Entity may enter into Leases for space in the Northern Telecom
Properties without the prior written consent of Weeks so long as (i) the
terms of the Lease equal or exceed the Leasing Guidelines, (ii) the
prospective Tenant is approved by Weeks, in the exercise of commercially
reasonable judgment (provided, however, if the Tenant is an affiliate of
the Contributors, Weeks may elect to withhold its approval in its absolute
and sole discretion), (iii) the Lease is on a form previously approved by
Weeks, and (iv) within ten (10) business days after written request by
Weeks, the Contributors shall furnish a copy of any such Lease which has
been executed since the last such request to Weeks.
b. The Contributors covenants and agrees that, so long as this Agreement
remains in full force and effect, the Contributors will not permit Project
Entity to amend or modify the Existing Loan Documents in any way, will
cause Project Entity to make all payments of money, and will cause Project
-13-
<PAGE>
Entity to perform all obligations, required under the Existing Loan
Documents. The Contributors will take no affirmative action and will not
permit Project Entity to take any affirmative action which shall cause the
Contributors to be unable to contribute good and marketable title to the
Northern Telecom Properties or which shall cause any warranty or
representation contained in this Agreement to be incorrect or misleading in
any material respect at any time.
c. Promptly after Northern Telecom exercises its "First Option" (as that term
is defined in the Northern Telecom Lease) to release all or a portion of
the space from the Northern Telecom Lease, the Contributors shall notify
Weeks of such exercise which notice shall be accompanied by a copy of the
"Release Notice" (as that term is defined in the Northern Telecom Lease).
d. On even date herewith, the Contributors shall cause the Project Entity to
enter into an agreement with Weeks (i) for the provision of construction
and development services with respect to the construction of Tenant
improvements in each of the Vacated Northern Telecom Properties for which
Weeks shall earn fees equal to five percent (5%) of the hard cost of Tenant
construction commenced after the date this Agreement, payable monthly; and
(ii) for the provision of property management and leasing services for each
of the Northern Telecom Properties for a term commencing on the date hereof
and ending, with respect to each of the Northern Telecom Properties, on the
date that Northern Telecom Property is contributed to Weeks for (A) a
management fee equal to the greater of fifty-eight cents ($.58) per annum
per square foot or four percent (4%) (or such other percentage as is
contractually agreed in a Lease with respect to the rental collected from
that Lease) of the gross collected rent (excluding reimbursables) for each
of the Northern Telecom Properties, payable monthly; (B) an owners expense
reimbursement fee of forty-two cents ($.42) per annum per square foot; and
(C) leasing fees customary to the market. When a Vacated Northern Telecom
Property is conveyed to a new Project Entity pursuant Paragraph 3b of this
Agreement, such new Project Entity shall take subject to and assume the
above described agreements for construction and development services and
for management and leasing services.
e. The Contributors shall fund to Weeks, upon written request, all costs to be
incurred or incurred in re-leasing space to bring the Vacated Northern
Telecom Properties to Stabilization, including costs incurred to upfit the
space to meet the requirements of any new tenant, leasing commissions and
tenant concessions (other than free rent).
9. EXISTING LOANS.
--------------
-14-
<PAGE>
a. The Northern Telecom Properties are subject to the Existing Loans and are
encumbered by the Existing Loan Documents. At the time the Contributors
notify Weeks that a Northern Telecom Property is to be contributed to Weeks
pursuant to this Agreement, such notice shall state whether (i) the
Contributors, at their sole cost and expense, will pay-in-full the Existing
Loan that encumbers each Northern Telecom Property to be contributed and
cause the Existing Loan Documents to be canceled immediately prior to the
Contribution, or (ii) the Contributors intend to contribute the Northern
Telecom Property subject to the Existing Loan to Weeks pursuant to this
Agreement.
b. Weeks agrees to accept a Contribution of a Northern Telecom Property
subject to the Existing Loan applicable thereto and assume the Existing
Loan (subject to its non-recourse provisions), provided each of the
following conditions is satisfied at the time of Contribution to the
reasonable satisfaction of Weeks:
i. On or before Contribution, Weeks shall receive from the Lender of
the Existing Loan an estoppel and consent agreement in form and
content reasonably acceptable to Weeks confirming, among such
other matters as Weeks may reasonably require, that it is the
holder of the applicable Existing Loan Documents, the outstanding
principal of the Existing Loan, that no default is then
outstanding, identifying the applicable Existing Loan Documents,
confirming the amounts of any tax and insurance escrows, and
consenting to the Contribution to Weeks of the Northern Telecom
Property as provided in this Agreement and the assumption by
Weeks, subject to the limited recourse provision therein
contained, of the Existing Loan.
ii. On or before the Contribution, the agreement by the Lender of the
Existing Loan to modification of the applicable Existing Loan
Documents to reflect change in ownership (e.g., financial
---
reporting requirements, transfer restrictions, deletion of any
personal covenants specific to the Contributors and other matters
that Weeks, in the exercise of commercially reasonably judgment,
deems necessary or appropriate [but in no event, shall Weeks
propose amendments to the loan amount, loan term, payment
schedule or interest rate, except as provided in clause (iii)
below]).
iii. The Contributors, at their sole cost and expense, shall have
obtained the agreements of New England Mutual Life Insurance
Company shall agree to either (i) permit early prepayment of each
of the Existing Loans held by it, at par, and without penalty or
prepayment fee of any kind, at any time on or after the
-15-
<PAGE>
Contribution Date, or (ii) a reduction of the interest rate of
each of the Existing Loans held by it to eight and one-quarter
percent (8.25%). If after reasonable efforts the Contributors are
unable to obtain the agreement of New England Mutual Life
Insurance Company to either prepayment at par or an interest rate
reduction as described in the immediately preceding sentence, in
lieu of such renegotiated terms, the Contribution Value of 100
Perimeter Park Property, 300 Perimeter Park Property and 500
Perimeter Park Property each shall be reduced by One Hundred
Eighty-Seven Thousand Five Hundred Dollars ($187,500), for a
total reduction of Five Hundred Sixty-Two Thousand Five Hundred
Dollars ($562,500).
iv. The Contributors shall pay all transfer fees and all other
expenses and costs imposed by the Lender of the Existing Loan,
including, without limitation, its attorneys' fees and expenses,
as a condition to assumption.
10. TITLE AND SURVEY.
----------------
a. Weeks hereby approves the Permitted Exceptions (including, without
limitation, the Leases identified on the Rent Roll) and agrees to accept
the Contribution of a Northern Telecom Property subject to the Permitted
Exceptions applicable to the Northern Telecom Property, except for those
Permitted Exceptions that relate to the Existing Loan that encumbers that
Northern Telecom Property that is not to be assumed by Weeks pursuant to
Paragraph 9 of this Agreement.
b. Within thirty (30) days before the Contribution Date of a Northern Telecom
Property, Weeks shall cause title and survey to be updated and Weeks shall
identify in such notice any title exception (other than Permitted
Exceptions) Weeks determines to be objectionable. The Contributors shall
cure any such exception on or before the Contribution Date to Weeks'
reasonable satisfaction and, if such cure is not completed by that date,
then the Contribution shall be delayed for a period not to exceed sixty
(60) days to permit the Contributors additional time to cure. If after such
delay, such title objection is not cured to Weeks' reasonable satisfaction,
Weeks may elect to do one of the following: (i) cure the exception, with
all costs and expenses incurred by Weeks applied to reduce the Contribution
Value and the Adjusted Contribution Value, in which case the Contribution
shall be further delayed an additional sixty (60) day period, or (ii)
terminate this Agreement as to that Northern Telecom Property or as to the
remaining uncontributed Northern Telecom Properties (if the nature of the
exception is such that it affects the remaining uncontributed Northern
Telecom Properties).
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<PAGE>
11. DATE, TIME AND PLACE OF CONTRIBUTION. Each Contribution shall
------------------------------------
commence at 9:00 a.m., local time, on the Contribution Date at the offices of
Kennedy Covington Lobdell & Hickman, L.L.P., Two Hanover Square, Suite 1900, 434
Fayetteville Street Mall, Raleigh, North Carolina 27602-1070, or at such other
place as may be agreed by the Contributors and Weeks. The following adjustments
and prorations shall be made on the Contribution Date with respect to the
Northern Telecom Property to be Contributed on that date by appropriate cash
payments between the Contributors and Weeks.
a. The Contributors shall be entitled to all rents [including any additional
rent and any accrued tax and operating expense reimbursements, subject to
clause (b) below], charges, and other revenue of any kind attributable to
any period under the Leases or otherwise up to but not including the
Contribution Date. Weeks shall be entitled to all rents [including any
additional rent and any accrued tax and operating expense reimbursements,
subject to clause (b) below], charges and other revenue of any kind
attributable to any period under the Leases or otherwise on and after the
Contribution Date. Rents and expense escalations or other reimbursements
due landlord under the Leases collected prior to the Contribution Date and
attributable to both the Contributors' and Weeks' periods of ownership
shall be prorated as of the Contribution Date. Uncollected rents and
expense escalations or other reimbursements due landlord under the Leases
shall not be prorated at the time of Contribution, but Weeks shall include
such amounts in Weeks' monthly billing statements to the Tenants, make
reasonable efforts to collect the same and tender the same to H.S. Lichtin,
as agent for the Contributors, upon receipt, provided that all rents,
escalations and other reimbursements due landlord under the Leases
collected by Weeks on or after the Contribution Date shall be prorated as
of the Contribution Date and shall first be applied to all amounts due
under the Leases at the time of collection (i.e., current rents, delinquent
rents attributable to periods after Contribution and sums due Weeks as the
current owner and landlord) with the balance (if any) payable to the
Contributors, but only to the extent of amounts delinquent and actually due
the Contributors. The Contributors and Project Entity shall not have any
right to sue any Tenant under the Leases for sums due the Contributors for
periods attributable to the Contributors' ownership of the Northern Telecom
Property. The Contribution Value shall not be reduced for Security
Deposits, which shall be transferred to the Partnership at Contribution.
The Contributors shall pay cash to Weeks for the amount of pre-paid rentals
held by the Contributors under the Leases.
b. Real estate taxes shall be prorated as of the Contribution Date. The
Contributors shall be responsible for all real estate taxes attributable to
the Northern Telecom Property to, but not including the, Contribution Date.
If the real estate tax rate and assessments have not been set for the year
in which the Contribution occurs, then the proration of such taxes shall be
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based upon the rate and assessments for the preceding tax year, and such
proration shall be adjusted in cash between the Contributors and Weeks upon
presentation of written evidence that the actual taxes paid for the year in
which the Contribution occurs differ from the amounts used at Contribution.
Notwithstanding the foregoing, the Contributors shall be entitled to a
refund of their proportionate share of such taxes for which the Project
Entity has not been reimbursed by Tenants, to the extent Weeks after
Closing recovers an increase in taxes attributable to the year in which
contribution occurs from the Tenants under the Leases, and Weeks agrees to
conduct an annual reconciliation of tax "pass-through" for the tax year of
Closing in accordance with the terms of the Leases.
c. Operating expenses for the Northern Telecom Property shall be prorated as
of the Contribution Date. The Contributors shall pay all utility charges
and other operating expenses attributable to the Northern Telecom Property
for the period prior to but not including the Contribution Date (except for
those utility charges and operating expenses payable by Tenants in
accordance with the Leases) and Weeks shall pay all utility charges and
other operating expenses attributable to the Northern Telecom Property for
the period on or after the Contribution Date. Notwithstanding the
foregoing, the Contributors shall be entitled to a refund of the
Contributors' proportionate share of such operating expenses for which the
Contributors has not been reimbursed by Tenants, to the extent Weeks after
Contribution recovers such reimbursement in operating expenses attributable
to the year in which Contribution occurs from the Tenants under the Leases,
and Weeks agrees to conduct an annual reconciliation of operating expenses
"passthrough" for the Contribution in accordance with the terms of the
Leases. The Contributors shall cause the Project Entity to assign to Weeks
any deposits with any of the utility services or companies servicing the
Northern Telecom Property. Weeks shall arrange with such services and
companies to have accounts transferred to Weeks' name beginning at 12:01
a.m. on the day following the Contribution Date.
d. If the Northern Telecom Property is to be contributed subject to an
Existing Loan in accordance with the terms and conditions of Paragraph 9 of
this Agreement, (i) the Contributors shall make a cash payment to Weeks
equal to the sum of the amount of accrued but unpaid interest due under the
Existing Loan attributable to any period up to, but not including, the
Contribution Date; and (ii) Weeks shall make a cash payment to the
Contributors equal to the amount of any tax, insurance premium or other
escrow deposits maintained pursuant to the Existing Loan Documents.
e. If at any time following the Contribution Date the amount of an item listed
in the subparagraphs of this Paragraph 11 shall prove to be incorrect, the
party in whose favor the error was made shall promptly pay to the other
party the sum necessary to correct such error upon receipt of proof of such
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<PAGE>
error, provided that such proof is delivered to the party from whom payment
is requested on or before one (1) year after the Contribution Date.
12. COSTS AND EXPENSES; PREPARATION OF DOCUMENTS. Costs and expenses
--------------------------------------------
shall be apportioned in the following manner:
a. Weeks shall pay the premium for title insurance, the survey fees and
recording costs related to each Contribution, as well as all costs incurred
by it in inspecting the Northern Telecom Properties and making such other
investigations thereof as it deems appropriate.
b. The Contributors shall pay all transfer taxes, if any, and any fees and
expense imposed by a Lender under Paragraph 9 hereof.
c. Each party shall pay its own attorneys' fees in connection with this
transaction.
d. Weeks' attorney shall prepare all Contribution documents, which shall be
subject to the reasonable approval of the Contributors' attorney and which
shall be substantially the same as the documents used in the Initial
Contribution.
13. ACCESS TO AND EXAMINATION OF THE NORTHERN TELECOM PROPERTIES. Weeks,
------------------------------------------------------------
personally or through agents, employees or contractors, may go upon the Northern
Telecom Properties during normal business hours prior to Contribution to conduct
such soil, engineering, environmental and other tests, investigations and
analyses of the Land and Improvements as Weeks deems desirable and to review and
make photocopies of the Leases, lease commission agreements, Service Contracts,
amendments, contracts and plans and specifications relating to or affecting the
Northern Telecom Properties. Weeks shall pay all costs incurred in making such
tests, analyses, copies, and investigations. In no event shall Weeks conduct any
intrusive or destructive tests, analyses, or investigations of the Northern
Telecom Properties without first obtaining the Contributors' written consent,
which will not be unreasonably withheld. Weeks acknowledges that any such
examinations or inspections of the Northern Telecom Properties pursuant to this
subparagraph or otherwise are subject to the rights of all Tenants, and Weeks
agrees to conduct such inspections or examinations in such a manner so as to
honor the rights of the Tenants and to prevent disruption of the ordinary
operation of the Tenants' business on the Northern Telecom Properties. Weeks
agrees to repair any damage to the Northern Telecom Properties resulting or
relating to such inspection or examination and agrees to and does hereby
indemnify, defend, and hold the Contributors harmless from any personal injury,
death, damage to property, damages, liens, claims, losses, and liabilities
arising out of Weeks' exercising such right and privilege to go upon the
Northern Telecom Properties, including the acts and omissions of Weeks'
employees, agents, contractors and consultants (but under no circumstances shall
Weeks be liable to the Contributors for consequential damages attributable to
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<PAGE>
the results or findings of such tests). Weeks' indemnity under this
subparagraph shall survive the Contribution or any termination of this
Agreement.
14. REPRESENTATIONS AND WARRANTIES OF THE CONTRIBUTORS. As of the date of
--------------------------------------------------
this Agreement, the Contributors hereby make, jointly and severally, for the
benefit of Weeks the following representations and warranties:
a. Project Entity is a limited partnership duly formed, validly existing and
in good standing under the laws of the State of North Carolina and has the
requisite authority to enter into and perform this Agreement. The
Contributors are the only general partners, limited partners, as
applicable, of Project Entity.
b. The execution, delivery and performance of this Agreement by Project Entity
has been duly and validly authorized by all necessary partnership action.
This Agreement has been duly executed and delivered by the Contributors and
constitutes a legal, valid and binding obligation of the Contributors,
enforceable against the Contributors in accordance with the terms hereof
(except as enforcement may be limited by bankruptcy, insolvency or other
laws affecting enforcement of creditors' rights generally and general
equity principles).
c. Except as has been obtained or is being effected as part of the
consummation of the Transaction, no consent, waiver, approval or
authorization of, or filing, registration or qualification with, or notice
to, any governmental unit or any other regulatory body is required to be
made, obtained or given by the Contributors in connection with the
execution, delivery and performance of this Agreement by the Contributors
or the Project Entities.
d. Except for waivers and consents that have been obtained prior to the date
hereof, except as provided in Paragraph 9 of this Agreement, and except as
would not have a material adverse effect on any of the Northern Telecom
Properties, no consent of any party to any agreement, contract, mortgage,
indenture, lease, reciprocal easement or operating agreement or other
arrangement, to which the Contributors or Project Entity is a party, or, by
which the Contributors or Project Entity is bound, is required in
connection with the execution, delivery or performance by the Contributors
of this Agreement or the consummation of the transactions provided for
herein.
e. None of the execution, delivery and performance of this Agreement by the
Contributors does or will, with or without the giving of notice, lapse of
time or both, (i) violate, conflict with or constitute a default under any
term or condition of (A) the organizational documents of Project Entity, or
(B) any term or provision of any judgment, decree, order, statute,
injunction, rule or regulation of a governmental unit applicable to the
Contributors or Project Entity or any agreement, contract, mortgage,
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<PAGE>
indenture, lease, reciprocal easement or operating agreement or other
arrangement to which any Contributor or Project Entity is a party or by
which it is bound or to which any of its assets or any of the Northern
Telecom Properties is subject, except as provided in Paragraph 9 of this
Agreement and except in the case where appropriate waivers and consents
have been obtained prior to the date hereof, and except as would not have a
material adverse effect on the Contributors, Project Entity or any of the
Northern Telecom Properties, or (ii) result in the creation of any lien or
other encumbrance upon the assets of the Contributors, Project Entity or
any of the Northern Telecom Properties, except as may be contemplated by
this Agreement or the other Transaction Documents, and except as would not
have a material adverse effect on the Contributors, Project Entity or any
of the Northern Telecom Properties.
f. Project Entity has complied with all laws applicable to the conduct of the
business of Project Entity and to the ownership, use and operation of the
Northern Telecom Properties and has obtained all licenses and permits
required for the conduct thereof, except where the failure to so comply or
obtain will not have a material adverse effect on Project Entity or any of
the Northern Telecom Properties. To the Contributors' knowledge, such
licenses and permits are in full force and effect, the Contributors and
Project Entity have not taken any action that would (or failed to take any
action the omission of which would) result in the revocation of such
licenses or permits, and the Contributors and Project Entity have not
received any notice of violation from any federal, state or municipal
entity or written notice of an intention by any such government entity to
revoke any certificate of occupancy or other certificate, license or permit
issued by it in connection with the use of any of the Northern Telecom
Properties, that in each case has not been cured or otherwise resolved to
the satisfaction of such government entity, except where such failure or
such action will not have a material adverse effect on the Contributors,
Project Entity or any of the Northern Telecom Properties.
g. With regard to investment:
i. Each Contributor is acquiring Units for its own account and not
with a view to, or for sale in connection with, the
"distribution", as such term is used in Section 2(11) of the
Securities Act of 1933, as amended (the "Securities Act"), of
any of Units in violation of the Securities Act.
ii. Each Contributor is an "accredited investor", as that term is
defined in Rule 501(a) of Regulation D promulgated under the
Securities Act.
iii. Each Contributor understands that the Units have not been
registered under the Securities Act by reason of a specific
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<PAGE>
exemption from the registration provisions of the Securities Act
which depends upon, among other things, the nature of the
investment intent and the accuracy of such Contributor's
representations as expressed herein.
h. Each Contributor has had an opportunity to discuss Weeks' business,
management and financial affairs with Weeks' management and the opportunity
to review Weeks' financial records.
i. Each Contributor understands and acknowledges that no public market now
exists for any of the securities issued by Weeks and that there can be no
assurance that a public market will ever exist for the Units.
j. Each Contributor has such knowledge and experience in financial and
business matters that each Contributor is capable of evaluating the merits
and risks of the purchase of the Units pursuant to this Agreement and of
protecting each Contributor's interests in connection herewith.
k. The Contributors and Project Entity have not knowingly caused or permitted
any Hazardous Material to be improperly maintained or disposed of on, under
or at any of the Northern Telecom Properties or any part thereof. To the
Contributors' knowledge, and except as may be revealed in the environmental
reports (which are identified in Exhibit J): (i) no liability under or
---------
violation of any Environmental Laws exists with respect to Northern Telecom
Properties, (ii) the Contributors and Project Entity have not received any
written notice from any governmental agency or instrumentality having
jurisdiction thereof of any violation of any Environmental Laws that
remains uncured as of the date hereof or that it has any material liability
with respect thereto, (iii) there are no administrative, regulatory or
judicial proceedings pending or threatened against Project Entity pursuant
to, or alleging any material violation of, or material liability under any
Environmental Laws, (iv) none of the properties now or heretofore owned,
leased or used by Project Entity has been used as a storage or disposal
site (whether temporary or permanent) for any hazardous, toxic or dangerous
materials the storage or disposal of which is governed by any Environmental
Laws in violation of such Environmental Laws, (v) there are no underground
storage tanks located on, under or about any of the Northern Telecom
Properties, and there is no facility located on or at any of the Northern
Telecom Properties that is subject to the reporting requirements of Section
312 of the Federal Emergency Planning and Community Right to Know Act of
1986 and the federal regulations promulgated thereunder (42 U.S.C. (S)
11022) and (vi) no Hazardous Material has been improperly maintained or
disposed of on, under or at any of the Northern Telecom Properties or any
part thereof. In connection with the representations and warranties in this
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<PAGE>
subparagraph, Weeks acknowledges that the Contributors disclaims any
professional expertise with respect to Environmental Laws.
l. With respect to the Northern Telecom Properties, Project Entity (i) is the
sole owner and (ii) has good, valid and marketable title, free and clear of
all Liens other than the following:
i. Liens securing the Existing Loans, Liens, or deposits made to
secure the release of such Liens, securing taxes, the payment of
which is at the time not delinquent or the payment of which is
actively being contested in good faith by appropriate proceedings
diligently pursued, and for which appropriate reserves shall have
been established by Project Entity.
ii. Attachments, judgments and other similar Liens arising in
connection with court or administrative proceedings, provided,
that the execution or other enforcement of such Liens is
effectively stayed or secured and the claims secured by such
Liens are actively being contested in good faith by appropriate
proceedings diligently pursued, and for which appropriate
reserves shall have been established by Project Entity.
iii. Zoning laws and ordinances; provided that, to the Contributors'
knowledge, none of the Northern Telecom Properties are in
violation thereof, in any material respect and that such laws and
ordinances do not require the demolition, vacation or cessation
of the use for industrial or office purposes (as applicable) of
any portion of the improvements material to each of the Northern
Telecom Properties or require the discontinuance of the use of
all or any material portion of any of the Northern Telecom
Properties as industrial facilities or office buildings.
iv. Any laws, ordinances, deeds of trust, mortgages, liens,
easements, rights of way, restrictions, exemptions, reservations,
conditions, limitations, covenants, encumbrances, adverse rights
or interests and other matters defined as Permitted Exceptions;
provided that, to the Contributors' knowledge, the Northern
Telecom Properties are not in violation thereof in any material
respect and the same do not require the demolition, vacation or
cessation of the use of for industrial or office purpose of any
portion of the improvements material to such Northern Telecom
Properties or require the discontinuance of the use of all or any
material portion of such Northern Telecom Properties as
industrial facilities or office buildings.
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<PAGE>
v. Any other easements, rights of way, restrictions, exceptions,
reservations, conditions, limitations, covenants, adverse rights
or interests, licenses, minor irregularities in title and other
similar encumbrances which do not in the aggregate materially
impair the use of such properties in the operation of the
business of Project Entity.
vi. Any law or governmental regulation or other right of any
governmental unit, which (i) requires the person to maintain
certain facilities or perform certain acts as a condition of its
occupancy or use of its assets and properties, or (ii) condemns,
appropriates or recaptures the person's assets or property.
vii. Liens imposed by laws, such as carriers', warehousemen's and
mechanics' Liens and other similar Liens arising in the ordinary
course of business which secure payment of obligations not more
than sixty (60) days past due or which are being contested in
good faith by appropriate proceedings diligently pursued, and for
which appropriate reserves shall have been established by Project
Entity.
m. The Contributors and Project Entity have not received any written or other
actual notice of any violation of any applicable zoning regulation or
ordinance, or of any employment or other regulatory law, order, regulation
or requirement relating to Project Entity's operations, practices,
properties or assets that remain uncured as of the date hereof, and, to the
Contributors' Knowledge, there are no such violations that, individually or
in the aggregate, will have a material adverse effect on any of the
Northern Telecom Properties.
n. Project Entity has no liabilities of any nature, whether matured or
unmatured, fixed or contingent, regardless of whether the disclosure
thereof would otherwise be required by GAAP, which would have, individually
or in the aggregate, a material adverse effect upon Project Entity or any
of the Northern Telecom Properties except for (1)Leases identified on the
Rent Roll, (2) the commission obligations identified on Exhibit P hereto,
---------
(3) Existing Loan Documents, (4) the Permitted Exceptions and (5) the
Service Contracts (collectively, the "Significant Agreements"), or as shown
on the audits of the books and records described in Section 8.2 of the
Contribution Agreement for Completed Properties.
o. With respect to the Existing Loans, the Contributors represent and warrant
as follows:
i. The loan documents identified on Exhibit C hereto constitute all
---------
of the documents that evidence or secure the Existing Loans; and
such documents have not been amended or modified except as
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expressly identified on said Exhibit C. The Contributors have
---------
delivered to Weeks true, correct and complete copies of all of
the Existing Loan Documents.
ii. All payments due and payable on or before the date of this
Agreement under the Existing Loan Documents by Project Entity
have been paid, and no monetary default exists as of the date of
this Agreement.
iii. As of the date of this Agreement, no written notice of a default
is outstanding and, to the Contributors' Knowledge, no condition
exists which with the giving of notice or the passage of time or
both would constitute an event of default under the Existing Loan
Documents.
p. Each of the Significant Agreements referred to in subparagraph n above is
(to the Contributors' Knowledge, with respect to parties thereto other than
Project Entity) valid and binding and in full force and effect, enforceable
against the parties thereto in accordance with its terms (except as
enforcement may be limited by bankruptcy, insolvency or other laws
affecting enforcement of creditors' rights generally and general equitable
principles).
q. Other than as set forth in Exhibit K hereto, there are no claims, actions,
---------
suits, proceedings or investigations pending, or, to the Contributors'
Knowledge, threatened, before any court, governmental unit or arbitrator
with respect to any Project Entity or any Northern Telecom Property, and,
to the Contributors' knowledge, the likely outcome of the claims or other
matters set out in said Exhibit K, will not have a material adverse effect
---------
on the Contributors or any of the Northern Telecom Properties.
r. Each Project Entity is classified as a partnership for federal income tax
purposes and not as an association taxable as a corporation.
s. The Rent Roll attached hereto as Exhibit H for the Northern Telecom
---------
Properties is true, correct and complete with respect to the categories
described therein, except to the extent any inaccuracies would not,
individually or in the aggregate, have a material adverse effect on the
value of any of the Northern Telecom Properties.
t. The Rent Roll lists each of the Leases in effect as of the date of the Rent
Rolls with respect to the Northern Telecom Properties. In the case of any
sublease or assignment of any such Lease, the Tenant listed in such Rent
Roll remains liable for the performance of said Lease.
u. Except as disclosed in the engineering reports listed in Exhibit L,
---------
attached hereto and by this reference made a part hereof, the Improvements
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are in good condition and repair and have not suffered any material
casualty or, to the Contributors' Knowledge, other material damage that has
not been repaired in all material respects. To the Contributors' Knowledge,
there is no material latent or patent structural, mechanical or other
significant defect or deficiency in the Improvements, other than as
disclosed in said engineering reports.
v. No proceedings have been commenced, or, to the Contributors' Knowledge,
threatened, by any authority having the power of eminent domain to condemn
any part of any of the Northern Telecom Properties or any Improvements
thereon that, if successful, would have a material adverse effect on any of
the Northern Telecom Properties.
w. To the Contributors' Knowledge, none of the Tenants now occupying the
Northern Telecom Properties or having a Lease of space in the Northern
Telecom Property is the subject of any bankruptcy, reorganization,
insolvency or similar proceedings.
x. Exhibit M, attached hereto and by this reference made a part hereof, sets
---------
forth an accurate and complete list of the insurance policies relating to
the Northern Telecom Properties or any part thereof obtained by and naming
the Project Entities (other than policies obtained or maintained by
tenants); all such policies are in full force and effect and all premiums
thereunder have been paid to the extent due; and no notice of cancellation
has been received with respect thereto and, to the Contributors' Knowledge,
none is threatened.
y. No representation or warranty by the Contributors herein contains any
untrue statement of a material fact or omits to state a material fact
necessary in order to make the statements contained herein, in light of the
circumstances under which they were made, not misleading.
z. None of Project Entity, its general partners or limited partners, as
applicable, owns, directly or indirectly, (i) one percent (1%) or more of
the total combined voting power of all classes of stock entitled to vote,
or one percent (1%) or more of the total number of shares of all classes of
stock, of any corporation that is a Tenant or (ii) an interest of one
percent (1%) or more in the assets or net profits of any Tenant.
aa. Project Entity has not received written notice that any Tenant intends
either to cease such operations (other than temporarily due to casualty,
remodeling, renovation or any similar cause) or to cease operating under
the name under which it was operating as of the date hereof.
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bb. To the Contributors' Knowledge, no condition exists which, with the giving
of notice or the passage of time, or both, would permit any party to cancel
its obligations under any reciprocal easement agreement or Lease, except as
expressly set forth in the Northern Telecom Lease.
cc. Except for routine repairs and maintenance, all alterations, improvements
or other work required to have been completed by Project Entity under any
reciprocal easement agreements and Leases, including, without limitation,
all alterations, improvements and other work required to prepare space for
the initial occupancy of each tenant under a Lease, has heretofore been
completed and paid for in full, except to the extent reflected in Exhibit
-------
N, attached hereto and by this reference made a part hereof.
-
dd. Each of the Northern Telecom Properties is an independent unit which does
not now rely on any facilities (other than facilities covered by Permitted
Exceptions including, without limitations, any reciprocal easement
agreements or facilities of municipalities or public utility and water
companies and other than parking areas which the Northern Telecom
Properties make use of under any reciprocal easement agreements) located on
any property not included in the Real Property that is part of that
Northern Telecom Property to fulfill any municipal or governmental
requirement or for the furnishings to the Northern Telecom Properties of
any essential building systems or utilities.
ee. Project Entity has not received any written notice which is still in effect
that there is, and, to the Contributors' Knowledge, there does not exist,
any violation of a condition or agreement contained in any easement,
restrictive covenant or any similar instrument or agreement affecting the
Northern Telecom Properties or any portion thereof, if such violation would
have a material adverse effect on any of the Northern Telecom Properties.
ff. Project Entity is not in violation of any radius restrictions, exclusive or
similar provisions contained in any reciprocal easement agreements, Leases
or any other agreements to which Project Entity is a party or is bound, if
such violation would have a material adverse effect on Project Entity or
any of the Northern Telecom Properties.
gg. Project Entity is solvent, has not made a general assignment for the
benefit of its creditors, and has not admitted in writing its inability to
pay its debts as they become due, nor has Project Entity filed, nor does it
contemplate the filing of, any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings, or any other proceeding for the
relief of debtors in general, nor has any such proceeding been instituted
by or against Project Entity, nor is any such proceeding to the
Contributors' Knowledge threatened or contemplated.
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hh. Attached hereto as Exhibit O is a schedule of the Service Contracts now in
---------
effect to which Project Entity and/or the Northern Telecom Properties are
subject. No notice of default has been received by Project Entity from any
of the parties to the Service Contracts and, to the Contributors'
Knowledge, no event has occurred which, with notice or lapse of time, or
both, will constitute any such default. There are no Service Contracts
affecting any of the Northern Telecom Properties other than as listed on
said Exhibit O, and the Service Contracts are in full force and effect.
---------
ii. All leasing commissions payable in connection with the Leases now in
occupancy have been paid-in-full, including leasing commissions payable
with respect to extensions, expansions and renewals which have not been
exercised as of the date hereof or payable in the event a Tenant does not
exercise a cancellation right under its Lease, except for commission
obligations identified on Exhibit P, attached hereto and by this reference
---------
made a part hereof.
jj. The Contributors do not lease space at the Northern Telecom Properties, and
no tenant at the Northern Telecom Properties is "related" to the
Contributors or the Project Entities within the meaning of Section 267(b)
or Section 707(b) of the Internal Revenue Code of 1986, as amended.
kk. No interest in the Northern Telecom Properties is or is deemed to be,
directly or indirectly, an asset of a "Plan" (as defined in the next
sentence). "Plan" means an "employee benefit plan" as defined in Section
----
3(3) of the Employee Retirement Income Security Act of 1974, as amended, or
a "plan" within the meaning of Section 4975(e)(1) of the Internal Revenue
Code of 1986, as amended.
ll. Each Project Entity is classified as a partnership for federal income tax
purposes and not as an association taxable as a corporation.
mm. The representations and warranties of the Contributors contained in this
Paragraph 14, as updated and reaffirmed at each Contribution Date, shall
continue in effect as provided in the Partnership Amendment.
15. REPRESENTATIONS AND WARRANTIES OF WEEKS. Weeks represents and
---------------------------------------
warrants to the Contributors, as follows:
a. Weeks is a limited partnership duly formed, validly existing and in good
standing under the laws of the State of Georgia. By the first Contribution
Date, Weeks will be qualified to transact business in the State of North
Carolina. Weeks has full power and authority to execute and deliver this
Agreement and all other documents executed and delivered, or to be executed
and delivered, by it (contemporaneously herewith or at Contribution) in
-28-
<PAGE>
connection with the transactions described herein and to perform all of its
obligations arising under this Agreement and such other documents; the
officers executing this Agreement and such other documents on behalf of
Weeks have the authority to bind Weeks hereunder and thereunder.
b. Neither the execution and delivery of this Agreement nor any other
documents executed and delivered, or to be executed and delivered by Weeks
(contemporaneously herewith or at Contribution) in connection with the
transactions described herein will violate any provision of Weeks' limited
partnership agreement, articles of incorporation or by-laws of Weeks'
General Partner or of any agreements, regulations, or laws to which Weeks
is bound, except for waivers and consents that have been obtained prior to
the date hereo f.
c. To Weeks' knowledge, there is no action, suit, proceeding, or claim
affecting Weeks pending or being prosecuted in any court or by or before
any federal, state, county, or municipal department, commission, board,
bureau, agency, or other governmental instrumentality which would prevent
consummation by Weeks of the Contribution of the Northern Telecom
Properties or materially and adversely affect the performance of any of
Weeks's other obligations hereunder to be performed prior to, at or after
Contribution.
d. Weeks is solvent, has not made a general assignment for the benefit of its
creditors, and has not admitted in writing its inability to pay its debts
as they become due, nor has Weeks filed, nor does it contemplate the filing
of, any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings, or any other proceeding for the relief of debtors in general,
nor has any such proceeding been instituted by or against Weeks, nor is any
such proceeding to Weeks' knowledge threatened or contemplated.
16. CONDITIONS.
----------
a. In addition to any other conditions provided in this Agreement, Weeks'
obligation to accept Contribution of a Northern Telecom Property pursuant
to this Agreement is subject to the satisfaction of each of the following
conditions at or prior to the Contribution Date for that Northern Telecom
Property:
i. The Contributors shall have complied with and performed all of
its obligations and covenants set forth in this Agreement.
ii. On or before the Contribution Date, the Contributors shall have
executed and delivered all documents required to be delivered by
the Contributors pursuant to the terms of this Agreement.
Additionally, the Contributors shall have delivered to Weeks
reasonable evidence of its authority to consummate the
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<PAGE>
transaction herein contemplated, including without limitation, an
opinion of counsel in form and content reasonably acceptable to
Weeks.
iii. All of the representations and warranties made by the
Contributors in Paragraph 14 shall be true correct at and as of
the Contribution Date as though such representations and
warranties were made both at and as of the date hereof and at and
as of the Contribution Date. Provided, further, the
representations and warranties concerning Rent Roll and Leases,
when reaffirmed at Contribution shall be made with respect to a
Rent Roll made as of Contribution and such Rent Roll shall
disclose no material changes from the Rent Roll attached hereto
as Exhibit H, except those approved by Weeks in writing.
---------
iv. The Contributors shall have obtained and delivered to Weeks by
the date and time of Contribution a Tenant Estoppel Certificate
for all Leases then in effect in the Northern Telecom Property,
each duly executed by an authorized officer of the Tenant under
such Lease and dated no earlier than sixty (60) days before the
Contribution Date. The Contributors agrees to use the
Contributors' diligent good faith efforts to obtain such Tenant
Estoppel Certificates at or prior to Contribution. Any material
modification to the form of Tenant Estoppel Certificate shall be
approved in writing by Weeks in advance and, in Weeks'
discretion, may be the basis upon which Weeks excludes such
certificate in the determination as to whether this condition has
been satisfied. During the term of this Agreement, as and when
received, the Contributors shall provide to Weeks copies of each
Tenant Estoppel Certificate received from any Tenant promptly
after receipt of such Tenant Estoppel Certificate. Weeks shall
have the right to delay Contribution by up to thirty (30) days by
written notice to the Contributors if the Contributors has not
obtained the required Tenant Estoppel Certificates. Additionally,
with respect to the Contribution of the Non-Vacated Northern
Telecom Properties, the Tenant Estoppel Certificate from Northern
Telecom must confirm that the "First Option" (as defined in the
Northern Telecom Lease) has lapsed, unexercised, as to the Non-
Vacated Northern Telecom Properties.
v. No material adverse change shall have occurred to the Northern
Telecom Properties, except as otherwise provided in Paragraphs 17
and 18.
vi. A title insurance company approved by Weeks shall be prepared to
issue to Weeks title insurance coverage on ALTA Form Policy, in
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<PAGE>
an amount not in excess of the Adjusted Contribution Value, and
specifying as exceptions to coverage only the Permitted
Exceptions.
vii. The contingencies set forth in this Paragraph 16(a) are for the
sole benefit of Weeks, and Weeks may elect in writing to waive
any such contingency reserved for its benefit and proceed to
consummate the transaction contemplated hereby.
b. In addition to any other conditions provided in this Agreement, the
Contributors' obligation to contribute a Northern Telecom Property is
subject to the satisfaction of each of the following conditions at or prior
to the Contribution Date for that Northern Telecom Property:
i. Weeks shall have complied with and performed all of its
obligations and covenants set forth in this Agreement.
ii. On or before the Contribution Date, Weeks shall have executed and
delivered all documents required to be delivered by Weeks
pursuant to the terms of this Agreement, and shall have issued
Units and made cash payments to Contributors as required under
Paragraph 7 hereof. Additionally, Weeks shall have delivered to
the Contributors reasonable evidence of its authority to
consummate the transaction herein contemplated, including without
limitation, an opinion of counsel in form and content reasonably
acceptable to the Contributors.
iii. All of the representations and warranties made by Weeks in
Paragraph 15 shall be true and correct at and as of the
Contribution Date as though such representations and warranties
were made both at and as of the date hereof and at and as of the
Contribution Date.
iv. The contingencies set forth in this Paragraph 16(b) are for the
sole benefit of the Contributors, and the Contributors may elect
in writing to waive any such contingency reserved for its benefit
and proceed to consummate the transaction contemplated hereby.
17. FIRE AND CASUALTY. Prior to the Contribution of a Northern Telecom
-----------------
Property, the risk of loss shall remain with the Contributors and the
Contributors shall bear all ownership risks and obligations, including
construction risks and the risk of cost overruns. The Contributors shall
maintain in effect until the Contribution Date all insurance policies currently
in force with respect to the Northern Telecom Property to be contributed
including liability insurance and fire and extended coverage insurance. If at
any time prior to the Contribution Date any portion of the Northern Telecom
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<PAGE>
Properties is destroyed or damaged as a result of fire or any other casualty (a
"Casualty"), the Contributors shall promptly give written notice (a "Casualty
Notice") thereof to Weeks. If a Northern Telecom Property is the subject of a
Casualty, Weeks shall have the right, at its sole option, of terminating this
Agreement (by written notice to the Contributors given within thirty (30) days
after receipt of the Casualty Notice from the Contributors) as to that Northern
Telecom Property, unless
(a) (i) all such damage or destruction is repaired at the sole cost
and expense of the Contributors prior to Contribution to substantially the
condition existing immediately prior to such damage or destruction, or (ii) the
cost to fully repair or restore such damage is less than Two Hundred Fifty
Thousand Dollars ($250,000) and either (x) insurance proceeds sufficient to
restore fully such damage are available and the insurance company issuing the
Contributors' insurance policies has confirmed in writing prior to the
expiration of such thirty (30) day period that such Casualty is covered by such
policies and that no defense to payment of the claim on account thereof exists,
or (y) the Contributors give Weeks a credit at Contribution (the "Credit") in an
amount equal to the deficiency in any insurance proceeds described in clause
(x); and
(b) such Casualty (i) does not result in Tenants terminating their
Leases or asserting a right to terminate their Leases, and (ii) would not
entitle Tenants occupying more than twenty-five percent (25%) of the space in
the Northern Telecom Property in the aggregate to terminate their Leases after
Contribution if such Tenants have not waived such right as of Contribution.
If a Casualty Notice is given to Weeks less than thirty (30) days prior to
Contribution at Weeks' option Contribution shall be postponed to a date not
earlier than thirty (30) days after Weeks' receipt of the Casualty Notice. If
Weeks terminates this Agreement pursuant to this Paragraph, then this Agreement
shall terminate and the parties hereto shall have no further rights or
obligations hereunder, with regard to that Northern Telecom Property. If Weeks
does not terminate this Agreement, the proceeds of any insurance with respect to
the Northern Telecom Property paid between the date of this Agreement and the
Contribution Date, together with the Credit if applicable, shall be paid to
Weeks at the time of Contribution and all unpaid claims and rights in connection
with property damage to the Northern Telecom Properties shall be assigned to
Weeks at Contribution without in any manner affecting the Adjusted Contribution
Value.
18. EMINENT DOMAIN. In the event of a taking by condemnation or eminent
--------------
domain proceedings of any material portion of a Northern Telecom Property [prior
to Contribution, the Contributors shall promptly give written notice thereof to
Weeks and Weeks shall have the right, at its sole option, of terminating this
Agreement as to that Northern Telecom Property by written notice given to the
Contributors on or before the tenth (10th) day following receipt of such notice.
For purposes hereof, a "material portion" of any Northern Telecom Property shall
-32-
<PAGE>
be any portion upon which an improvement is located, any portion which contains
enough parking spaces, the loss of which would cause a violation of any Lease on
the Northern Telecom Property or cause a violation of any applicable zoning
ordinance or which permanently alters the access to and from the Northern
Telecom Property in a material adverse way. If Weeks so terminates this
Agreement as to that Northern Telecom Property, then this Agreement shall
terminate as to that Northern Telecom Property, and the parties hereto shall
have no further rights or obligations hereunder. If Weeks does not terminate
the Agreement pursuant to this Paragraph as to that Northern Telecom Property,
then the Contributors shall pay over to Weeks on the Contribution Date all
monies received or collected by the Contributors by reason of such taking, and
the Contributors shall further assign and transfer to Weeks all of the
Contributors' right, title and interest of, in and to any awards that have been
or may be made for such condemnation or eminent domain proceedings and the
additional money that may be payable when the same is and becomes assignable as
a matter of law.
19. DEFAULT.
-------
a. If Weeks defaults hereunder, the Contributors may either proceed against
Weeks at law for damages or seek specific performance of Weeks' obligations
hereunder.
b. If the Contributors default hereunder, Weeks may either proceed against the
Contributors at law for damages or seek specific performance of the
Contributors' obligations hereunder. After notice as provided in Paragraph
19(c) below, and lapse of cure period without cure by the Contributors,
Weeks may elect to cure the Contributors' default hereunder and the
Contributors shall promptly, upon demand, reimburse Weeks for all costs and
expenses incurred in cure, including interest on such costs and expenses,
at a rate equal to LIBOR plus one hundred and thirty-five (135) basis
points, per annum, from the date incurred until the date of reimbursement,
and upon Contribution of the Northern Telecom Property in question, if
ever, the Adjusted Contribution Value for such Northern Telecom Property
shall be reduced by such costs and expenses of cure and accrued interest
thereon.
c. Prior to exercising any of its rights hereunder or at law or in equity for
a default, a party shall give the other party written notice of such
default hereunder and the other party shall have thirty (30) days to cure
such default from and after such notice.
d. After Closing, the liability of the Contributors for a breach of the
representations and warranties by the Contributors in this Agreement shall
be governed by the Partnership Amendment and the pledge of Units and Shares
of therein contained.
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<PAGE>
20. BROKERAGE FEES. Except for brokers paid-in-full at the Initial
--------------
Contribution pursuant to separate written agreements for the entire Transaction,
the Contributors and Weeks each represent and warrant to the other that they
have not employed, retained, or consulted any broker, agent, or finder in
connection with this Agreement or the Contribution, and the Contributors and
Weeks each hereby indemnify and agree to hold the other harmless from and
against any and all claims, demands, causes of action, debts, liabilities,
judgments and damages (including costs and reasonable attorneys' fees incurred
in connection with the enforcement of this indemnity) which may be asserted or
recovered against the indemnified party for or on account of any brokerage fee,
commission, or other compensation arising by reason of the indemnitor's breach
of this representation and warranty.
21. MISCELLANEOUS.
-------------
a. Weeks shall not assign, sell, convey or otherwise transfer any or all its
rights under this Agreement without the prior written consent of the
Contributors. The Contributors shall not assign, sell, convey, or otherwise
transfer any or all of the Northern Telecom Properties or its rights under
this Agreement without the prior written consent of Weeks. No such
assignment by the Contributors or Weeks shall relieve or release the
assigning party of any liability hereunder. Subject to the foregoing, this
Agreement and the terms and provisions hereof shall inure to the benefit of
and be binding upon the successors and assigns of the parties.
b. This Agreement and the other Transaction Documents supersedes all prior
agreements between the parties hereto with respect thereto. No claim of
waiver, modification, consent or acquiescence with respect to any of the
provisions of this Agreement shall be made against either party, except on
the basis of a written instrument executed by or on behalf of such parties.
c. This Agreement shall be governed by and construed in accordance with the
laws of the State of North Carolina.
d. The headings of the several paragraphs and subparagraphs of this Agreement
are inserted solely for the convenience of reference and are not a part of
and are not intended to govern, limit, or aid in the construction of any
term or provision hereof, except otherwise provided in Paragraph 1 of this
Agreement.
e. Words of any gender used in this Agreement shall be held and construed to
include any other gender, and words of a singular number shall be held to
include the plural and vice versa, unless the context requires otherwise.
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<PAGE>
f. Any notice, request or other communication (a "notice") required or
------
permitted to be given hereunder shall be in writing and be delivered by
hand or overnight courier (such as UPS Next Day Air) or by facsimile
transmission or mailed by United States registered or certified mail,
return receipt requested, postage prepaid and addressed to each party at
its address as set forth below. Any such notice shall be considered given
on the date of such hand or courier delivery, deposit with such overnight
courier for next business day delivery, or upon transmission by facsimile
with confirmation, or deposit in the United States mail, but the time
period (if any is provided herein) in which to respond to such notice shall
commence on the date of hand or courier delivery or the confirmation date
of facsimile transmission or on the date received following deposit in the
United States mail as provided above. Rejection or other refusal to accept
or inability to deliver because of changed address of which no notice was
given shall be deemed to be receipt of the notice. By giving at least five
(5) days' prior written notice thereof, any party may from time to time and
at any time change its mailing address hereunder. Any notice of any party
may be given by such party's counsel. The parties respective notice
addresses are as follows:
Weeks: Weeks Realty, L.P.
4497 Park Drive
Norcross, Georgia 30093
Attention: Thomas D. Senkbeil,
Vice Chairman/Chief
Investment Officer
Fax: (770) 717-3310
With Copy To: King & Spalding
191 Peachtree Street
Atlanta, Georgia 30303-1763
Attention: William J. Armstrong, Esq.
Fax: (404) 572-5148
Contributors: Harold S. Lichtin
Suite 200
1800 Perimeter Park Drive
Morrisville, North Carolina 27560
Fax: (919) 467-4428
With Copy To: Kennedy Covington Lobdell & Hickman, L.L.P.
Two Hanover Square
Suite 1900
434 Fayetteville Street Mall
Raleigh, North Carolina 27602
-35-
<PAGE>
Attention: Alan H. Peterson, Esq.
Fax: (919) 743-7358
g. If any provision of this Agreement or the application thereto to any person
or circumstance shall be invalid or unenforceable to any extent, the
remainder of this Agreement and the application of such provisions to the
other persons or circumstances shall not be affected thereby and shall be
enforced to the greatest extent permitted by law.
h. Nothing in this Agreement shall be construed as giving any person, firm,
corporation, or other entity, other than the parties hereto, their
successors and assigns, any rights, remedy or claim under or in respect to
this Agreement or any provision hereof.
i. This Agreement may be executed in any number of counterparts, each of which
so executed shall be deemed an original; such counterparts together shall
constitute the one agreement.
j. Time is of the essence of this Agreement; provided, however, that if the
-------- -------
time within which any action, consent, approval, or other activity herein
contemplated, expires on a Saturday, Sunday, or legal holiday, such time
period shall automatically be deemed extended to the first day after the
scheduled termination of such time period which is not a Saturday, Sunday,
or legal holiday.
k. No failure or delay by a party to exercise any right it may have by reason
of the default of the other party shall operate as a waiver of default or
modification of this Agreement or shall prevent the exercise of any right
by the first party while the other party continues to be so in default.
l. All representations, warranties and agreements of the Contributors and
Weeks contained in this Agreement shall not be merged into the Contribution
documents and shall survive Contribution subject to the provisions of the
Partnership Amendment.
m. In the event of a breach of this Agreement by either party, the non-
breaching party shall be entitled to recover all costs associated with
enforcing this Agreement, including reasonable attorneys' fees and expenses
actually incurred.
n. So long as a Northern Telecom Property is subject to this Agreement, the
Contributors agree not to offer to any party other than Weeks, that
Northern Telecom Property, or any portion thereof or any interest therein,
for sale or lease, except for the leasing of space pursuant to the terms of
this Agreement, and the Contributors agree not to negotiate, solicit or
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<PAGE>
entertain any offers from or with any party other than Weeks, to purchase
or lease the property, or any portion thereof or any interest therein,
except for the leasing of space as aforesaid.
o. Contemporaneously with the execution and delivery of this Agreement, Weeks
and the Contributors shall enter into a short form memorandum of this
Agreement, which shall be recorded in the public records of Wake County,
North Carolina, to give notice of Weeks' interest in the Northern Telecom
Properties pursuant to this Agreement.
p. The Contributors hereby appoint H.S. Lichtin as their authorized
representative under this Agreement. Any direction, consent, approval,
disapproval, authorization or other action required or permitted to be
given or taken under this Agreement by any of the Contributors shall be
given or taken only by H.S. Lichtin. In giving notice to the Contributors
under this Agreement, Weeks may give such notice only to H.S. Lichtin as
provided under Paragraph 21f of this Agreement and such notice shall
constitute notice to all of the Contributors. If Weeks receives notice of
any matter from any Contributor who is not H.S. Lichtin, Weeks shall be
entitled at its discretion to disregard such notice and such notice shall
have no legal effect under this Agreement, unless and until confirmed by
H.S. Lichtin. The written statements and representations of H.S. Lichtin
shall for the purposes of this Agreement be binding upon the Contributors
and Weeks shall have no obligation or duty whatsoever to inquire into the
authority to take any action which he proposes to take, regardless of
whether H.S. Lichtin actually has the authority to take any such action;
and Weeks shall be entitled to rely upon any direction, authorization,
consent, approval or disapproval given by H.S. Lichtin in connection with
any matter arising out of or in connection with this Agreement.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above stated.
CONTRIBUTORS:
------------
(SEAL)
-------------------------------
HAROLD S. LICHTIN
(SEAL)
-------------------------------
MARIE ANTOINETTE ROBERTSON
PERIMETER PARK WEST ASSOCIATES
LIMITED PARTNERSHIP,
a North Carolina limited partnership
By: (SEAL)
-----------------------------
Harold S. Lichtin,
General Partner
By: (SEAL)
-----------------------------
Marie Antoinette Robertson,
General Partner
[Signatures Continued on Next Page.]
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<PAGE>
WEEKS:
-----
WEEKS REALTY, L.P., a Georgia limited partnership
authorized to do business in the State of North
Carolina as Weeks Realty Limited Partnership
By: Weeks GP Holdings, Inc., a Georgia corporation,
sole general partner
By:
--------------------------------------------
Title:
-----------------------------------------
[CORPORATE SEAL]
-39-
<PAGE>
EXHIBIT A
---------
NORTHERN TELECOM PROPERTIES
<TABLE>
<CAPTION>
SQUARE
NAME ADDRESS FOOTAGE
<S> <C> <C> <C>
1. 100 Perimeter Park 55,664
2. 200 Perimeter Park 55,664
3. 300 Perimeter Park 55,664
4. 400 Perimeter Park 74,088
5. 500 Perimeter Park 74,017
6. 800 Perimeter Park 55,637
------
370,734
=======
</TABLE>
A-1
<PAGE>
EXHIBIT B
---------
EXISTING LOANS
<TABLE>
<CAPTION>
Maximum Interest Maturity
Project Lender Balance Rate Date (Yr.)
------- ------ ------- -------- ----------
<S> <C> <C> <C> <C>
100 Perimeter Park New England 3,238,985 9.625% 2000
Mutual
300 Perimeter Park New England 3,083,927 9.625% 2000
Mutual
500 Perimeter Park New England 3,785,403 9.625% 2000
-----------
Mutual 10,108,315
200 Perimeter Park First Union 3,000,000 9.6% 1997
-----------
2,955,346
400 Perimeter Park Manulife 4,197,131 8.00% 2006
800 Perimeter Park Manulife 3,103,448 8.00% 2006
-----------
7,300,579
$20,408,894
===========
</TABLE>
B-1
<PAGE>
CONTRIBUTION AGREEMENT
(PERIMETER PARK WEST LAND)
This Agreement ("Agreement") is made as of this 31st day of December, 1996,
among HAROLD S. LICHTIN, an individual resident of North Carolina ("H.S.
Lichtin"), MARIE ANTOINETTE ROBERTSON, an individual resident of Texas ("M.A.
Robertson"), and PERIMETER PARK WEST ASSOCIATES, a North Carolina limited
partnership ("PPW") (H.S. Lichtin and M.A. Robertson and PPW, collectively, the
"Contributors" and sometimes, singularly, a "Contributor"); and WEEKS REALTY,
L.P., a Georgia limited partnership authorized to do business in the State of
North Carolina as Weeks Realty Limited Partnership ("Weeks").
1. Description of The Property. The Contributors agree to contribute to the
---------------------------
capital of Weeks and Weeks agrees to accept such contribution to its
capital, for the contribution value and upon the terms and conditions set
forth below, that certain parcel of land located in Wake County, North
Carolina, containing in the aggregate approximately 66.11 gross acres, more
or less, as further described on Exhibit A hereto (the "Property").
---------
2. Contribution Value. Subject to any adjustment pursuant to Paragraph 10
------------------
hereof, the contribution value (the "Contribution Value") is for each
"Tract" (as defined in Paragraph 5 hereof) of the Property contributed at
each of the four (4) successive contributions of Property made pursuant to
this Agreement is One Million Eight Hundred Thirty-Seven Thousand Five
Hundred and no/100 Dollars ($1,837,500.00) of each such contribution.
As of the date of contribution of any Tract, Weeks shall issue to the
Contributors [pro rata in accordance with their respective partnership
interests in the Future Limited Partnership, a North Carolina limited
partnership (the "Land Partnership")] a number of Units, equal to the
Contribution Value of that Tract, after any adjustments pursuant to
Paragraph 10 of this Agreement, divided by the Unit Price. All Units so
issued shall be held by the Contributors subject to that certain
Registration Rights and Lock-Up Agreement (as to Units issued on or before
June 30, 1998) or that certain Registration Rights and Lock-Up Agreement
for Post-June 30, 1998 Shares and Units (as to Units issued after June 30,
1998), both of even date herewith (collectively, the "Rights Agreements")
and that certain Second Amendment to the Second Amended and Restated
Agreement of Limited Partnership of Weeks, dated of even date herewith
(pursuant to which H.S. Lichtin and M.A. Robertson, among others, are
admitted to Weeks as limited partners) (the "Partnership Amendment").
"Units" shall mean limited partnership units in Weeks Realty, L.P., as
defined in the above-described Rights Agreements. "Unit Price" shall mean
the arithmetic average of the New York Stock Exchange closing price of a
<PAGE>
share of common stock of Weeks Corporation for the twenty (20) trading days
immediately preceding the date of contribution rounded to the nearest one-
eighth.
Notwithstanding any provision of that Agreement to the contrary, no
fractional Units shall be issued to the Contributors pursuant to this
Agreement. If as a result of the application of the foregoing formulas, a
fractional Unit is due a Contributor, Weeks shall pay to that Contributor,
in cash on the same date as the fractional Unit would otherwise be issued
and in lieu of any such fractional Units, an amount equal to that
fractional Unit times applicable Unit Price, as determined pursuant to this
Agreement.
3. Title Exceptions. The Property shall be contributed subject to the
----------------
following title exceptions and no other:
(a) Applicable building and zoning laws.
(b) Encroachments, easements and other matters identified on Exhibit B
---------
hereto.
(c) Covenants, easements and other matters to which Weeks and the Land
Partnership have agreed as provided below in Paragraph 4 hereto.
(d) Any matter arising by, through or under Weeks after the date of this
Agreement, including, without limitation, dedications and grants of
easements requested by Weeks pursuant to Paragraph 4 hereof.
4. Title Insurance and Survey. Within ten (10) business days after notice for
--------------------------
a contribution of a Tract pursuant to Paragraph 5 hereof, Weeks shall
identify in a notice any title exception affecting the Tract (other than
those specified in Paragraph 3) that Weeks determines to be objectionable.
The Contributors shall cure any such exception on or before the date
designated for contribution to Weeks' reasonable satisfaction and, if such
cure is not completed by that date, then the contribution shall be delayed
for a period not to exceed sixty (60) days to permit the Contributors
additional time to cure. If after such delay, such title objection is not
cured to Weeks' reasonable satisfaction, Weeks may elect to do one of the
following: (i) cure the exception, with all costs and expenses incurred by
Weeks applied to reduce the Contribution Value, in which case the
contribution shall be further delayed an additional sixty (60) day period,
or (ii) terminate this Agreement as to the Tract or as to the remaining
uncontributed Property (at Weeks' election, if in Weeks' reasonable
determination the exception is of such a nature that it affects the
remaining uncontributed Property) and sue the Contributors for damages at
law, or (iii) seek specific performance of the Contributors' obligations
hereunder.
The Contributors hereby covenant and agree with Weeks that, so long as this
Agreement remains in full force and effect, (i) the Contributors will not,
and will not permit the Land Partnership to, sell, assign, rent, lease,
-2-
<PAGE>
convey (absolutely or as security), grant a security interest in, or
otherwise encumber or dispose of, the Property (or any interest or estate
therein) without the prior written consent of Weeks; and (ii) the
Contributors will not, and will not permit the Land Partnership to, apply
for any modification to the zoning in effect for the Property as of the
date of this Agreement or agree to any impact fees or other restrictions on
future development rights that would affect the Property, without the prior
written consent of Weeks. The Contributors will not, and will not permit
the Land Partnership to, grade, cut timber or otherwise alter the physical
characteristics of the Property without the prior written consent of Weeks,
in each instance. The Contributors will take no affirmative action, and
will not permit the Land Partnership to take any affirmative action, which
shall cause the Contributors to be unable to contribute good and marketable
title to the Property or which shall cause any warranty or representation
contained in this Agreement to be incorrect or misleading in any material
respect at any time.
From time to time during the pendency of this Agreement, at the request and
expense of Weeks and subject to the prior consent of the Contributors,
which such consent shall not be unreasonably withheld or delayed, the
Contributors agrees to take actions or, cause the Land Partnership to take
such actions, to support applications and to enter into any easements,
covenants or other agreements with Weeks and third-parties pertaining to
development (including infrastructure, roads, utilities and other
development requirements), affecting the uncontributed portion of the
Property to facilitate Weeks' development of Tracts contributed to Weeks
and the remainder of the Property.
Additionally, at the request and expense of Weeks and subject to the prior
consent of the Contributors, which such consent shall not be unreasonably
withheld or delayed, the Contributors agree, or agree to cause the Land
Partnership, to dedicate to the public or quasi-public authorities,
portions of the Property not yet contributed to Weeks pursuant to this
Agreement for the purpose of dedicating public right-of-ways, utility
easements and other infrastructure items to facilitate development of the
Tracts contributed to Weeks and the remainder of the Property. The
Contributors agree to cooperate and support fully all reasonable requests
and actions taken by Weeks pursuant to this paragraph. Because Weeks is
obligated in any case ultimately to acquire all of the Property pursuant
to, and subject to, the terms and conditions of this Agreement, the
Contributors will cooperate with Weeks and will cause the Land Partnership
to cooperate with Weeks, to enable Weeks to develop and construct roads,
utilities, lines, facilities and other improvements, storm water detention
lines, facilities and other improvements, landscaping, lighting, signage
and traffic improvements, sidewalks and other infrastructure for the total
development within the Property by granting easements as reasonably
necessary to serve the Tracts which have been or that are being contributed
to Weeks and prior to the contribution of the remaining Property on which
such infrastructure improvements are developed. All improvements made by
-3-
<PAGE>
Weeks shall be constructed in a good and worker like manner and no liens
(except inchoate material and mechanics liens) shall be imposed on the
Property.
Weeks agrees to and does hereby indemnify, defend and hold the Contributors
harmless from any personal injury, death, damage to property, damage,
liens, claims, losses and liabilities arising out of Weeks' exercising such
right and privilege to go upon the Property, including the acts and
omissions of Weeks' employees, agents, contractors and consultants. Weeks
agrees to maintain appropriate public liability insurance covering its
activities on the Property with the Land Partnership and the Contributors
named as additional insureds.
Contemporaneously with the execution and delivery of this Agreement, Weeks
and the Land Partnership (at the direction of the Contributors) shall enter
into a short form memorandum of this Agreement, which shall be recorded in
the public records of Wake County, North Carolina, to give notice of Weeks'
interest in the Property pursuant to this Agreement.
5. Contribution. The contribution of the Property to the capital of Weeks
------------
shall take place at the offices of Kennedy Covington Lobdell & Hickman,
L.L.P., Two Hannover Square, Suite 1900 434 Fayetteville Street Mall,
Raleigh, North Carolina 27602-1070, or at such other place as may be agreed
by the Contributors and Weeks. The contribution of the Property shall occur
in incremental tracts (a "Tract") with four (4) successive contributions
until all of the Property is contributed by the Contributors to Weeks,
subject to the following conditions: (i) each Tract shall be as described
on Exhibit C hereto, (ii) thereafter, on the next four (4) anniversaries of
the date of this Agreement, one of the Tracts shall be contributed in
accordance with said Exhibit C hereto, in accordance with the order as
specified thereon.
Notwithstanding clause (ii) of the immediately preceding sentence to the
contrary, if as provided in that certain Contribution Agreement for
Northern Telecom Properties, dated of even date herewith, "Northern
Telecom" (as defined therein) elects to excuse its "First Option" under the
"Northern Telecom Lease" (as defined therein), then Weeks may by written
notice to the Contributors elect to delay the four contributions described
in said clause (ii) by one (1) year so that the four contributions shall
take place successively on the second, third, fourth and fifth
anniversaries of the date of this Agreement. Within fifteen (15) business
days prior to each contribution of Property, pursuant to this Agreement,
the Contributors shall notify Weeks of the next contribution, which notice
shall be accompanied by a revision of the Survey (the cost of preparation
of this Survey revision to be paid by Weeks) showing the Tract to be
contributed and evidence satisfactory to both parties that all requirements
of applicable law, state and local, pertaining to subdivision and relating
of the Property to separate the Tract have been satisfied (Weeks and the
Contributors agree to cooperate in good faith in the obtaining of all
necessary approvals in this regard).
-4-
<PAGE>
Notwithstanding the foregoing schedule of Tract contributions to the
contrary, if Weeks elects to accept contributions of more acreage of the
Property than Weeks is obligated to accept pursuant to the foregoing, Weeks
may elect to accept less acreage of the Property on the next successive
date(s) scheduled for contribution on an acre per acre basis.
Notwithstanding any other provision of this Paragraph 5 to the contrary,
(i) with respect to any Tract previously contributed to Weeks pursuant to
this Agreement, if Weeks has not commenced construction of a building on
that Tract or there remains a portion of that Tract that could be developed
with a building but no building has been started [such unused Tract(s) or
portion of Tract(s) collectively the "Unused Acreage"]; and (ii) Weeks has
a prospective tenant who desires to locate its building on an area of the
Property not yet contributed to Weeks pursuant to this Agreement; then, at
the written request of Weeks, the Contributors agree to contribute to Weeks
pursuant to this Agreement the Tract or portion thereof (such tract or
portion thereof, the "Deferred Issuance Tract") desired by the prospective
tenant except that issuance of Units for the Contribution Value of the
acreage of the Deferred Issuance Tract that does not exceed the
Contribution Value of the Unused Acreage shall not be issued until the
earliest of (A) the next date for contribution of a Tract under this
Agreement, (B) the date on which Weeks commences construction of a building
on the Unused Acreage, or (C) December 31, 2002. To secure Weeks'
obligation to subsequently issue Units as aforesaid for the Deferred
Issuance Tract, Weeks shall cause to be issued to H.S. Lichtin a stand-by
irrevocable letter of credit in the amount of the value of the Units to be
issued, in form and content and issued by a Bank reasonably acceptable to
H.S. Lichtin. Upon issuance of such Units, this letter of credit shall be
returned to Weeks. If Weeks defaults in issuance of such Units, H.S.
Lichtin shall be entitled to draw against the letter of credit and
distribute the proceeds to the Contributors in the same equivalent value as
the Units would have been issued under this Agreement.
Each time a Tract is to be contributed to Weeks by the Contributors
pursuant to this Agreement: (i) on the contribution date, the Contributors
shall cause the Land Partnership to convey good and marketable fee simple
title to the Tract to Weeks by general warranty deed subject only to
Permitted Title Exceptions, and (ii) in exchange for the contribution by
the Land Partnership, as described in the immediately preceding clause (i),
Weeks shall issue Units to the Contributors as provided in this Agreement.
The Contributors shall cause the Land Partnership to deliver possession of
the Tract to Weeks on the contribution date.
6. Adjustments. At each contribution, there shall be no proration of taxes
-----------
because, pursuant to Paragraph 14, Weeks shall fund payment of taxes.
7. Costs and Expenses; Preparation of Documents. Costs and expenses shall be
--------------------------------------------
apportioned in the following manner:
-5-
<PAGE>
(a) Weeks shall pay the premium for title insurance, title search costs,
the survey fees and recording costs related to this transaction, as
well as all costs incurred by it in inspecting the Property and making
such other investigations thereof as it deems appropriate.
(b) the Contributors shall pay all transfer taxes.
(c) Each party shall pay its own attorneys' fees in connection with this
transaction.
Weeks's attorney shall prepare all documents, which shall be subject to the
reasonable approval of the Contributors' attorney and which shall be
substantially the same as the documents used in the "Initial Contribution"
(as that term is defined in the Partnership Amendment).
8. Condemnation. If any authority having the power of eminent domain shall
------------
commence negotiations with the Contributors or the Land Partnership or
shall commence legal action against the Contributors or the Land
Partnership for the damaging, taking or acquiring of all or any part of the
Property, either temporarily or permanently in any condemnation proceeding
or by exercise of the power of eminent domain, the Contributors shall
immediately give notice of the same to Weeks. Upon the occurrence of any of
the foregoing events, if it reasonably appears that such taking would
materially interfere with Weeks' reasonable intended use of the Property,
Weeks shall have the right, at its option, to terminate this Agreement by
giving notice thereof to the Contributors, in which event Weeks shall be
released of all further obligations hereunder with respect to that portion
of the Property not yet contributed. Assuming no termination, at the time
of contribution, the Contributors shall cause the Land Partnership to
assign to Weeks all rights in and to any unpaid awards, settlement proceeds
or other proceeds payable by reason for any such taking.
In the event of any negotiations regarding the payment of any such awards
or proceeds, the Contributors will inform Weeks of all such negotiations of
which the Contributors has notice and no settlement shall be agreed to by
the Contributors without Weeks' written approval.
9. Representations and Warranties. As of the date of this Agreement, the
------------------------------
Contributors hereby make, jointly and severally, for the benefit of Weeks
each and every representation and warranty set forth in Paragraph 14 of
that certain Contribution Agreement for Development Properties, dated of
even date herewith, among the Contributors and Weeks, to the extent
applicable to unimproved land. As of the date of contribution for each
Tract under this Agreement, the Contributors shall remake for the benefit
of Weeks each and every representation and warranty set forth in said
-6-
<PAGE>
Paragraph 14 as to that Tract, to the extent applicable to unimproved land.
The liability of the Contributors for breach of these representations and
warranties is subject to the provisions of the Partnership Amendment.
10. Weeks' Inspection; "AS-IS" Sale; Hazardous Wastes. the Contributors grants
-------------------------------------------------
Weeks the right to enter the Property to inspect it, make soil tests
borings, make drainage tests, and make engineering and architectural
drawings or tests of the Property, provided that the foregoing shall not
materially alter or damage the Property or interfere with the
Contributors's activities on the Property. Weeks shall be liable to the
Contributors for any damage, loss and expenses (including reasonable
attorneys' fees) the Contributors incur by reason of such activities, and
if the transaction contemplated hereby does not close, Weeks shall provide
the Contributors with copies of all tests results and drawings.
Except for the representations and warranties contained or provided for
herein, the property is being sold in an "AS-IS" condition and "WITH ALL
FAULTS" as of the date of this Agreement and of the date of contributions.
Except as expressly set forth in this Agreement, no representations or
warranties have been made or are made and no responsibility has been or is
assumed by the Contributors or by any officer, person, firm, agent or
representative acting or purporting to act on behalf of the Contributors as
to the condition or repair of the Property or the value, expense of
operation, or income potential thereof or as to any other facet or
condition which has or might affect the Property, or the condition, repair,
value, expense of operation, or income potential of the Property or any
portion thereof. The parties agree that all understandings and agreements
heretofore made between them or their respective agents or representatives
with respect to the Property are merged in this Agreement, the exhibits
hereto annexed and other documents being entered into by the parties on the
date hereof (including, without limitation, the other agreements expressly
referred to herein) or contemplated in those documents, which together
fully and completely express their agreement, and that this Agreement has
been entered into with Weeks being satisfied with the opportunity afforded
for investigation (all such agreements, documents and exhibits,
collectively. the "Transaction Documents"). Weeks is not relying upon any
statement or representation by the Contributors unless such statement or
representation is specifically embodied in this Agreement or the other
Transaction Documents.
To the extent that the Contributors has provided to Weeks information from
any inspection, engineering or environmental reports concerning harmful or
toxic substances, the Contributors makes no representations or warranties
with respect to the accuracy or completeness, methodology of preparation or
otherwise concerning the contents of such reports. Weeks acknowledges that
the Contributors have requested Weeks to inspect fully the Property and
investigate all matters relevant thereto and to rely solely upon the
results of Weeks' own inspections or other information obtained or
otherwise available to Weeks, rather than any information that may have
-7-
<PAGE>
been provided by the Contributors to Weeks, other than the representations
and warranties of the Contributors contained or provided for herein on
which Weeks is entitled to rely.
Weeks has obtained the Phase I Environmental Site Assessment(s) identified
on Exhibit D hereto (the "Audit") and Weeks hereby approves the Audit and
---------
agrees to accept title to the Property subject to such environmental
matters as are reflected in the Audit. If any material adverse
environmental condition affecting the Property is discovered by, or comes
to the attention of, Weeks that is not disclosed in the Audit and the
Contributors do not remediate the same to the commercially reasonable
satisfaction of Weeks, then Weeks may elect by written notice to the
Contributors to terminate this Agreement as to the Tract affected thereby
of such portion of the Property not yet contributed to Weeks under this
Agreement thereof which Weeks reasonably determines is adversely affected
in the development thereof by such contamination (with credit against the
Contribution Value thereof at a rate of $111,178.00 per acre). The
Contributors shall have the right, but not the obligation, to remediate
such adverse environmental condition, at the sole cost and expense of the
Contributors.
The terms and provisions of this Paragraph 10 shall survive contribution
hereunder.
11. Notices. Any notice, request or other communication (a "notice")
-------
required or permitted to be given hereunder shall be in writing and shall
be delivered by hand or overnight courier (such as UPS Next Day Air) or by
facsimile transmission or mailed by United States registered or certified
mail, return receipt requested, postage prepaid and addressed to each party
at its address as set forth below. Any such notice shall be considered
given on the date of such hand or courier delivery, deposit with such
overnight courier for next business day delivery, or upon transmission by
facsimile with confirmation, or deposit in the United States mail, but the
time-period (if any is provided herein) in which to respond to such notice
shall commence on the date of hand or courier delivery or the confirmation
date of facsimile transmission or on the date received following deposit in
the United States mail as provided above. Rejection or other refusal to
accept or inability to deliver because of changed address of which no
notice was given shall be deemed to be receipt of the notice. By giving at
least five (5) days' prior written notice thereof, any party may from time
to time and at any time change its mailing address hereunder. Any notice of
any partly may be given by such party's counsel. The parties respective
notice addresses are as follows:
Weeks: Weeks Corporation
4497 Park Drive
Norcross, Georgia 30093
Attention: Thomas D. Senkbeil,
Vice Chairman/Chief
Investment Officer
FAX: (770) 717-3310
-8-
<PAGE>
With Copy To: King & Spalding
191 Peachtree Street
Atlanta, Georgia 30303-1763
Attention: William J. Armstrong, Esq.
FAX: (404) 572-5148
Contributors: Harold S. Lichtin
Suite 200
1800 Perimeter Park Drive
Morrisville, North Carolina 27560
FAX: (919) 467-4428
With Copy To: Kennedy Covington Lobdell & Hickman, L.L.P.
Two Hannover Square
Suite 1900
434 Fayetteville Street Mall
Raleigh, North Carolina 27602
Attention: Alan H. Peterson, Esq.
FAX: (919) 743-7358
12. Brokers. Except for brokers paid-in-full at the Initial Contribution
-------
pursuant to separate written agreements that cover the transactions
contemplated in this Agreement as well as the other Transaction Documents;
the Contributors and Weeks represent and warrant that neither has dealt
with any broker in connection with this transaction. If any claim is made
or brought by any broker in connection with this transaction, the party
whose agreement gave rise to such claim shall indemnify the other for any
damage or expenses sustained in connection therewith including, without
limitation, reasonable attorneys' fees. The terms and provisions of this
Paragraph 12 shall survive contributions hereunder.
13. Default. If Weeks defaults hereunder, the Contributors may either proceed
-------
against Weeks at law for damages or seek specific performance of Weeks'
obligations hereunder. If the Contributors defaults hereunder, Weeks may
either proceed against the Contributors at law for damages or seek specific
performance of the Contributors's obligations hereunder.
14. Infrastructure and Land CM Costs. From and after the date of this
--------------------------------
Agreement, and so long as this Agreement is in full force and effect, Weeks
agrees to pay all real estate taxes and other property assessments assessed
on the Property for 1997 and thereafter until this Agreement is no longer
in force and effect. If, after the date of this Agreement, Weeks elects to
construct roads, utility lines, rain water detention facilities or other
infrastructure items, such installation shall be at the sole cost and
expense of Weeks, without reimbursement obligation on the Contributors.
-9-
<PAGE>
15. Headings. The Paragraph headings are inserted for convenience only and
--------
are not intended to describe, interpret, define or limit the scope or
intent of this Agreement or any provision thereof.
16. Miscellaneous. All prior understandings and agreements between the
-------------
parties are deemed merged herein and in the other Transaction Documents.
This Agreement may be modified only by an agreement in writing signed by
the parties. Weeks may assign, sell, convey or otherwise transfer any or
all its rights under this Agreement without the prior written consent of
the Contributors. The Contributors shall not assign, sell, convey or
otherwise transfer any or all of the Properties or its rights under this
Agreement. No such assignment by the Contributors or Weeks shall relieve or
release the assigning party of any liability hereunder. Subject to the
foregoing, this Agreement and the terms and provision hereof shall inure to
the benefit of and be binding upon the successors and assigns of the
parties. This Agreement shall be governed by North Carolina law. Time is of
the essence.
17. Contributors' Representative. The Contributors hereby appoint
----------------------------
H.S. Lichtin as their authorized representative under this Agreement. Any
direction, consent, approval, disapproval, authorization or other action
required or permitted to be given or taken under this Agreement by any of
the Contributors shall be given or taken only by H.S. Lichtin. In giving
notice to the Contributors under this Agreement, Weeks may give such notice
only to H.S. Lichtin as provided under Paragraph 11 of this Agreement and
such notice shall constitute notice to all of the Contributors. If Weeks
receives notice of any matter from any Contributor who is not H.S. Lichtin,
Weeks shall be entitled at its discretion to disregard such notice and such
notice shall have no legal effect under this Agreement, unless and until
confirmed by H.S. Lichtin. The written statements and representations of
H.S. Lichtin shall for the purposes of this Agreement be binding upon the
Contributors and Weeks shall have no obligation or duty whatsoever to
inquire into the authority to take any action which he proposes to take,
regardless of whether H.S. Lichtin actually has the authority to take any
such action; and Weeks shall be entitled to rely upon any direction,
authorization, consent, approval or disapproval given by H.S. Lichtin in
connection with any matter arising out of or in connection with this
Agreement.
-10-
<PAGE>
IN WITNESS WHEREOF, the Contributors and Weeks have set their hand as of
the date and year first above written.
CONTRIBUTORS:
------------
(SEAL)
----------------------------------
HAROLD S. LICHTIN
(SEAL)
----------------------------------
MARIE ANTOINETTE ROBERTSON
PERIMETER PARK WEST ASSOCIATES
LIMITED PARTNERSHIP,
a North Carolina limited partnership
By: (SEAL)
-------------------------------
Harold S. Lichtin,
General Partner
By: (SEAL)
-------------------------------
Marie Antoinette Robertson,
General Partner
-11-
<PAGE>
WEEKS:
-----
WEEKS REALTY, L.P., a Georgia limited
partnership authorized to do business in
the State of North Carolina as Weeks
Realty Limited Partnership
By: Weeks GP Holdings, Inc., a Georgia
corporation, sole general partner
By:
--------------------------------
Title:
-----------------------------
-12-
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
CONTRIBUTION AGREEMENT
FOR
COMPLETED PROPERTIES
LICHTIN PORTFOLIO
AMONG
CONTRIBUTORS
AND
WEEKS REALTY, L.P.
DOING BUSINESS AS
WEEKS REALTY LIMITED PARTNERSHIP
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
-----------------
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
1. DEFINITIONS ................................................................. 1
-----------
2. STRUCTURE OF CONTRIBUTION.................................................... 5
-------------------------
3. COVENANT TO CONTRIBUTE....................................................... 6
----------------------
4. CONTRIBUTION VALUE........................................................... 6
------------------
5. ADJUSTED CONTRIBUTION VALUE.................................................. 6
---------------------------
5.1. Rent Concession...................................................... 6
---------------
5.2. Standard Adjustments and Prorations.................................. 6
-----------------------------------
5.2.1. Rent and Security Deposits................................... 6
--------------------------
5.2.2. Real Estate Taxes............................................ 7
-----------------
5.2.3. Operating Expenses........................................... 7
------------------
5.2.4. Existing Loans............................................... 8
--------------
5.2.5. Unfunded Leasing Obligations................................. 8
----------------------------
5.2.6. Delayed Adjustment........................................... 8
------------------
5.3. Other Adjustments.................................................... 8
-----------------
5.4. Optional Cash Payments............................................... 8
----------------------
6. CASH PAYMENTS AND ISSUANCE OF UNITS.......................................... 9
-----------------------------------
6.1. Cash Payments........................................................ 9
-------------
6.2. Issuance of Units.................................................... 9
-----------------
7. EXISTING LOANS............................................................... 9
--------------
7.1. Assumption........................................................... 9
----------
7.2. Conditions........................................................... 10
----------
7.2.1. Approval..................................................... 10
--------
7.2.2. Estoppel..................................................... 10
--------
7.2.3. Loan Modification............................................ 10
-----------------
7.2.4. Renegotiation of Terms....................................... 10
----------------------
8. CLOSING...................................................................... 11
-------
8.1. Time and Place of Closing............................................ 11
-------------------------
8.2. Closing Costs........................................................ 11
-------------
</TABLE>
i
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
9. TITLE EXAMINATION AND OBJECTIONS; FAILURE TO CURE............................ 12
-------------------------------------------------
9.1. Title Examination and Survey......................................... 12
----------------------------
9.2. Failure to Cure Title Objections..................................... 12
--------------------------------
10. ACCESS TO AND EXAMINATION OF THE COMPLETED
------------------------------------------
PROPERTIES; CONDITION OF THE COMPLETED PROPERTIES............................. 12
-------------------------------------------------
10.1. Access and Examination............................................... 12
----------------------
10.2. The Partnership's Condition.......................................... 13
---------------------------
11. REPRESENTATIONS AND WARRANTIES OF CONTRIBUTORS................................ 13
----------------------------------------------
11.1. Organization; Authority.............................................. 13
-----------------------
11.2. Due Authorization; Binding Agreement................................. 13
------------------------------------
11.3. Governmental Consents................................................ 14
---------------------
11.4. Other Consents....................................................... 14
--------------
11.5. No Violation......................................................... 14
------------
11.6. Compliance with Laws................................................. 14
--------------------
11.7. Investment........................................................... 15
----------
11.8. Access to Data....................................................... 15
--------------
11.9. No Public Market..................................................... 15
----------------
11.10. Experience; Risk..................................................... 15
----------------
11.11. Environmental........................................................ 15
-------------
11.12. Ownership of the Completed Properties................................ 16
-------------------------------------
11.13. Zoning; Other Laws................................................... 17
------------------
11.14. Absence of Undisclosed Liabilities and Contractual Obligations ...... 17
--------------------------------------------------------------
11.15. Existing Loans....................................................... 17
--------------
11.16. Significant Agreements; Binding Agreements........................... 18
------------------------------------------
11.17. Litigation........................................................... 18
----------
11.18. Tax Classification................................................... 18
------------------
11.19. Rent Roll............................................................ 18
---------
11.20. Leases............................................................... 18
------
11.21. Improvements......................................................... 18
------------
11.22. Condemnation......................................................... 19
------------
11.23. Bankruptcy and Insolvency............................................ 19
-------------------------
11.24. Insurance............................................................ 19
---------
11.25. Full Disclosure...................................................... 19
---------------
11.26. Ownership Interest in Tenants........................................ 19
-----------------------------
11.27. Tenant Operations.................................................... 19
-----------------
11.28. Lease Defaults....................................................... 19
--------------
11.29. Incomplete Improvements.............................................. 20
-----------------------
11.30. Integrated Facilities................................................ 20
---------------------
11.31. Agreement Violations................................................. 20
--------------------
11.32. Radius Restrictions.................................................. 20
-------------------
11.33. Financial Status..................................................... 20
----------------
</TABLE>
ii
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
11.34. Service Contracts.................................................... 20
-----------------
11.35. Lease Commissions.................................................... 21
-----------------
11.36. No Contributor-Leased Space.......................................... 21
---------------------------
11.37. ERISA................................................................ 21
-----
11.38. Survival............................................................. 21
--------
12. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PARTNERSHIP................. 21
------------------------------------------------------------
12.1. Due Authorization.................................................... 21
-----------------
12.2. Applicable Laws...................................................... 21
---------------
12.3. Litigation and Other Proceedings..................................... 22
--------------------------------
12.4. Financial Status..................................................... 22
----------------
13. CONDITIONS................................................................... 22
----------
13.1. The Partnership's Conditions......................................... 22
----------------------------
13.1.1. The Contributors' Performance.............................. 22
-----------------------------
13.1.2. The Contributors' Execution and Delivery................... 22
----------------------------------------
13.1.3. Representations and Warranties............................. 22
------------------------------
13.1.4. Tenant Estoppel Certificates............................... 22
----------------------------
13.1.5. Adverse Change............................................. 23
--------------
13.1.6. Other Transaction Documents................................ 23
---------------------------
13.1.7. The Partnership's Benefit.................................. 23
-------------------------
13.2. The Contributors' Conditions......................................... 23
----------------------------
13.2.1. The Partnership's Performance.............................. 24
-----------------------------
13.2.2. The Partnership's Execution and Delivery................... 24
----------------------------------------
13.2.3. Other Transaction Documents................................ 24
---------------------------
13.2.4. Representations and Warranties............................. 24
------------------------------
13.2.5. The Contributors' Benefit.................................. 24
-------------------------
14. OPERATIONS PRIOR TO CLOSING.................................................. 24
---------------------------
14.1. Repairs.............................................................. 24
-------
14.2. Operation of Improvements............................................ 24
-------------------------
14.3. Compliance with Existing Agreements.................................. 24
-----------------------------------
14.4. New Agreements....................................................... 25
--------------
14.5. Notices.............................................................. 25
-------
15. FIRE AND CASUALTY............................................................ 25
-----------------
16. EMINENT DOMAIN............................................................... 26
--------------
17. DEFAULT...................................................................... 26
-------
17.1. The Contributors' Default............................................ 26
-------------------------
17.2. The Partnership's Default............................................ 26
-------------------------
</TABLE>
iii
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
17.3. Pledge of Units...................................................... 27
---------------
18. BROKERAGE AND OTHER FEES..................................................... 27
------------------------
18.1. Representations Regarding Brokers.................................... 27
---------------------------------
18.2. Brokers' Commission and Representation............................... 27
--------------------------------------
18.3. Survival............................................................. 27
--------
19. MISCELLANEOUS................................................................ 27
-------------
19.1. Authorized Representative of Contributors............................ 27
-----------------------------------------
19.2. Successors and Assigns............................................... 28
----------------------
19.3. Waiver, Consent...................................................... 28
---------------
19.4. Governing Law........................................................ 28
-------------
19.5. Headings; Exhibits................................................... 28
------------------
19.6. Number and Gender of Words........................................... 28
--------------------------
19.7. Notices.............................................................. 28
-------
19.8. Severability......................................................... 29
------------
19.9. Other Parties........................................................ 29
-------------
19.10. Counterparts......................................................... 29
------------
19.11. Time Is Of The Essence............................................... 29
----------------------
19.12. Delay Not A Waiver................................................... 30
------------------
19.13. Survival............................................................. 30
--------
19.14. Confidentiality...................................................... 30
---------------
19.15. Attorney Fees........................................................ 30
-------------
19.16. Delayed Closings..................................................... 30
----------------
19.17. Claimed Default...................................................... 30
---------------
19.18. Land Representations and Warranties.................................. 31
-----------------------------------
</TABLE>
iv
<PAGE>
<TABLE>
<CAPTION>
EXHIBITS
- ------------
<S> <C>
Exhibit A Legal Descriptions of Land
Exhibit B Completed Properties
Exhibit C Existing Loans
Exhibit D Permitted Exceptions
Exhibit E Potential Commission Obligations
Exhibit F List of Contributors
Exhibit G Schedule of Contribution Values for each Completed Property
Exhibit H Intentionally Omitted
Exhibit I Inventory of Tangible Personal Property
Exhibit J Form of Tenant Estoppel Certificate
Exhibit K Transaction Documents
Exhibit L Schedule of Ownership Interests
Exhibit M Intentionally Omitted
Exhibit N Environmental Reports
Exhibit O Existing Loan Documents
Exhibit P Pending or Threatened Litigation
Exhibit Q Engineering Reports
Exhibit R Insurance Coverage
Exhibit S Schedule of Uncompleted Improvements
Exhibit T List of Service Contracts
Exhibit U Rent Roll
Exhibit V List of Major Tenants
</TABLE>
v
<PAGE>
CONTRIBUTION AGREEMENT
----------------------
FOR
---
COMPLETED PROPERTIES
--------------------
THIS CONTRIBUTION AGREEMENT FOR COMPLETED PROPERTIES (this "Agreement")
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made as of this 31st day of December, 1996, by and among "CONTRIBUTORS" (as
hereinafter defined) and WEEKS REALTY, L.P., a Georgia limited partnership
authorized to do business in the State of North Carolina as Weeks Realty Limited
Partnership (the "Partnership");
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W I T N E S S E T H; That,
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WHEREAS, pursuant to the "Transaction Documents" (as hereinafter
defined) the Contributors and other contributors identified in the Transaction
Documents have agreed to contribute in stages certain assets, properties and
businesses to the capital of the Partnership upon and subject to the terms and
conditions set forth in the Transaction Documents;
WHEREAS, one of the stages of the "Transaction" (as hereinafter
defined) is the contribution of the "Completed Properties" (as hereinafter
defined); and
WHEREAS, the parties desire to set forth in this Agreement the
specific terms and conditions upon which Contributors would contribute the
Completed Properties to the capital of the Partnership and upon which the
Partnership would accept contribution of the Completed Properties to its
capital.
NOW, THEREFORE, in consideration of the sum foregoing premises, the
respective undertakings of the parties and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged,
Contributors and the Partnership agree as follows:
1. DEFINITIONS. In addition to any other terms whose definitions are
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fixed and defined by this Agreement, each of the following defined terms, when
used in this Agreement with an initial capital letter or initial capital
letters, shall have the meaning ascribed thereto by this Article 1:
1.1 "Adjusted Contribution Value" means the adjusted contribution value
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for each of the Completed Properties determined after making certain adjustments
to the Contribution Value as provided in Section 5 of this Agreement.
1.2 "Agreement" means this Contribution Agreement by and among
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Contributors and the Partnership concerning the contribution of the Completed
Properties to the capital of the Partnership.
1.3 "Closing" means the consummation of the contribution of the Completed
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Properties to the capital of the Partnership and the payment of cash, issuance
of Units and assumption of debt (subject in each instance to applicable non-
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recourse provisions) in exchange for such contribution, all as contemplated by
this Agreement.
1.4 "Closing Date" means the time and date, established under Section 8.1
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hereof, when the Closing is to be consummated, as such date may be extended by
mutual agreement of the Partnership and Contributors or pursuant to the
provisions of this Agreement.
1.5 "Completed Property" means the Real Property, the Tangible Personal
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Property and the Intangible Personal Property located at, attributable to or
used in connection with one of the seventeen (17) projects identified on Exhibit
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B hereto; and Completed Properties means, collectively, all of the Real
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Property, the Tangible Personal Property and the Intangible Personal Property
located at, attributable to or used in connection with all of the seventeen (17)
projects identified on Exhibit B hereto. Any reference to a specific Completed
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Property shall be made by incorporating the name of the project set forth on
Exhibit B; for example, a specific reference to the first listed Completed
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Property shall be the "900 Perimeter Park Completed Property".
1.6 "Contributors" means, collectively, those individuals and entities
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listed on Exhibit F hereto; and "Contributor" means any one of the Contributors.
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1.7 "Contribution Value" means the contribution value for each of the
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Completed Properties set forth in Section 4 of this Agreement.
1.8 "Environmental Laws" means the Resource Conservation and Recovery Act
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(42 U.S.C. (S) 6901 et seq.), as amended by the Hazardous and Solid Waste
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Amendments of 1984; the Comprehensive Environmental Response, Compensation and
Liability Act (42 U.S.C. (S) 9601 et seq.), as amended by the Superfund
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Amendments and Reauthorization Act of 1986; the Hazardous Materials
Transportation Act (490 U.S.C. (S) 1801 et seq.); the Toxic Substance Control
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Act (15 U.S.C. (S) 2601 et seq.); Clean Air Act U.S.C. (S) 136 et seq.); the
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Occupational Safety and Health Act (29 U.S.C. (S) 651 et seq.) and all
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applicable federal, state and local environmental laws, including obligations
under the common law, ordinances, rules and regulations, as any of the foregoing
may have been amended, supplemented or supplanted prior to the date hereof,
relating to regulation or control of Hazardous Materials, hazardous, toxic or
dangerous substances or wastes, or their handling, storage or disposal or to
environmental health and safety.
1.9 "Existing Loan" means any one of the loans identified on Exhibit C
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hereto; and "Existing Loans" means, collectively, all of the loans identified on
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Exhibit C hereto.
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1.10 "Existing Loan Documents" means, collectively, all of the loan
documents evidencing and securing an Existing Loan.
1.11 "Hazardous Materials" means (i) those substances included within
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definitions of or identified as "hazardous substances," "hazardous materials,"
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or "toxic substances" in or pursuant to Environmental Laws; (ii) those
substances listed in the United States Department of Transportation Table (40
CFR 172.101 and amendments thereto) or by the Environmental Protection Agency
(or any successor agency) as hazardous substances (40 CFR Part 302 and
amendments thereto); (iii) any material, waste or substance which is or contains
(A) petroleum, including crude oil or any fraction thereof, natural gas or
synthetic gas usable for fuel or any mixture thereof, or any product containing
the foregoing substances, (B) asbestos or asbestos containing material, (C)
polychlorinated biphenyls, (D) any substance designated as "hazardous substance"
pursuant to Section 311 of the Clean Water Act, 33 U.S.C. (S) 1251 et seq. (33
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U.S.C. (S) 1321), or listed pursuant to Section 307 of the Clean Water Act (33
U.S.C. (S) 1317); (E) flammable explosives; (F) radioactive materials; and (iv)
such other substances, materials and wastes which are or become regulated as
hazardous, toxic or "special wastes" under Environmental Laws.
1.12 "H.S. Lichtin" means Harold S. Lichtin, an individual resident of
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North Carolina.
1.13 "Intangible Personal Property" means any intangible personal property
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now or hereafter owned by the Project Entities in connection with the Land, the
Improvements, or the Tangible Personal Property, and all of the rights of the
Project Entities under all contracts, utility arrangements, utility deposits,
and other agreements relating to the ownership, operation, and occupancy
thereof; provided, however, the term "Intangible Personal Property" does not
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include (i) any cash on hand and in bank accounts, (ii) the Leases and related
lease commission agreements, (iii) accounts receivable for periods of time prior
to the Closing, subject to the provisions of Section 5.2, (iv) any rights to the
name "Lichtin Properties, Inc", and any prepaid insurance premiums.
1.14 "Land" means those certain tracts or parcels of real property located
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in Wake County, North Carolina, as more particularly described in Exhibit A
hereto, together with all of the right, title, and interest of the Project
Entities in and to all appurtenances, rights, easements, tenements, and
hereditaments incident thereto.
1.15 "Lease" means any lease or occupancy agreement affecting the Completed
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Properties.
1.16 "Lender" means the holder of an Existing Loan.
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1.17 "Liens" means any liens, security interests, mortgages, deeds of
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trust, charges, claims, encumbrances, pledges, options, rights of first offer or
first refusal and any other rights or interests of others of any kind or nature,
actual or contingent, or other similar encumbrances of any nature whatsoever.
1.18 "Partnership Amendment" means that certain Second Amendment to the
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Second Amended and Restated Agreement of Limited Partnership Agreement of the
Partnership, pursuant to which the Contributors are admitted to the Partnership
as limited partners.
1.19 "Permitted Exceptions" means those matters set forth in Exhibit D,
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attached hereto and by this reference made a part hereof, and the Existing Loan
Documents (subject to Section 7).
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1.20 "Potential Commission Obligations" means potential commission
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obligations that may arise to outside broker if a Tenant extends or renews its
Lease or expands the size of its premises after the Closing Date set forth on
Exhibit E, attached hereto and by this reference made a part hereof.
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1.21 "Project Entity" means any entity, identified on Exhibit B hereto,
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which as of the date of this Agreement owns the Completed Property listed across
from it on said Exhibit B; and
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1.22 "Project Entities" means, collectively, all of the Project Entities
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identified on said Exhibit B hereto.
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1.23 "Real Property" means collectively, the Land and the Improvements.
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1.24 "Rent Roll" means a list of all Leases containing, with respect to
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each Lease, information as to the commencement date of such Lease, the
termination date of such Lease, any renewal rights or expansion rights under
such Lease, the approximate square footage of the leased premises under such
Lease, the annual base rental and additional rent due under such Lease, and the
amount and duration of any rent or other concessions made to the Tenant under
such Lease.
1.25 "Rights Agreement" means that certain Registration Rights and Lock-Up
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Agreement, dated of even date herewith and by and among the Partnership and the
Contributors and other contributors as contemplated in the Transaction
Documents.
1.26 "Service Contracts" means any and all of the service contracts,
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equipment, labor or material contracts, management contracts, maintenance or
repair contracts, personal property leases, or other agreements (other than the
Leases and related lease commission agreements) entered into by Project Entities
(or their predecessors-in-title) and that are in force and effect and that
affect the Completed Properties or the operation, repair, or maintenance
thereof. "Security Deposits" means the refundable deposits (in the form of cash,
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letters of credit or certificates of deposit) made by Tenants with the Project
Entities as security for such Tenants' obligations under their respective
Leases, to the extent not previously forfeited, applied or refunded, together
with interest thereon accrued as of the Closing Date (if any) which the Project
Entities are obligated to pay to any such Tenants.
1.27 "Survey" means a survey of the Real Property, which Survey shall
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comply with the 1992 ALTA/ACSM specifications for an Urban Survey with Table A
Responsibilities and Specifications 1-4, 6-11, and 13.
1.28 "Tangible Personal Property" means all tangible personal property
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located on the Real Property which is owned by the Project Entities and used in
the ownership, operation and maintenance of the Land and Improvements,
including, without limitation, all art, furniture, furnishings, fixtures and
equipment and stock for completion of tenant improvements. An inventory of the
Tangible Personal Property as of the date hereof is set forth on Exhibit I
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hereto; the Project Entities shall have the right to use and replace supplies,
stock items and other items of Tangible Personal Property in the ordinary course
of business through the Closing Date.
1.29 "Tenant" means any tenant or lessee under any of the Leases.
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1.30 "Tenant Estoppel Certificate" means the certificate to be submitted
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for execution to each Tenant with respect to the Lease pursuant to which such
Tenant leases space in the Improvements, such certificate to be in the form
attached hereto as Exhibit J and incorporated herein by this reference.
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1.31 "To Contributors' Knowledge", or words of similar import, means to the
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current actual knowledge of H.S. Lichtin, James C. Little, Robert G. Yelverton
or Carol R. Woods.
1.32 "Transaction" means the contribution in stages of certain assets,
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properties and businesses by the Contributors (and other contributors identified
in the other Transaction Documents) to the capital of the Partnership in
exchange for cash payments, issuance of Units and assumption of debt (subject in
each instance to applicable nonrecourse provisions) to, at the discretion of or
on behalf of certain of the Contributors (and other contributors identified in
the other Transaction Documents), all as more specifically set forth in and
contemplated by this Agreement and the other Transaction Documents.
1.33 "Transaction Documents" means, collectively, this Agreement and the
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documents identified on Exhibit K.
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1.34 "Units" means limited partnership units in Weeks Realty, L.P., as
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described in the Rights Agreement.
2. STRUCTURE OF CONTRIBUTION. Subject to the other terms and conditions of
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this Agreement, the contribution of the Completed Properties shall be structured
in the following manner: (a) on the Closing Date, each of the Contributors
shall contribute to the capital of the Partnership all of its general
partnership interests, membership interests and limited partnership interests,
as applicable, in the Project Entities in accordance with the schedule of
ownership interests as set forth on Exhibit L hereto; (b) in exchange for the
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contribution of ownership interests in the Project Entities as described in the
immediately preceding clause (a), the Partnership shall issue Units to the
Contributors and make cash payments to, at the direction of, or on behalf of the
Contributors as provided in Section 6; and (c) immediately following such
contribution as described in clause (a) above, on the Closing Date, the
Partnership, as the sole owner of all ownership interests in the Project
Entities, shall dissolve each of the Project Entities and all assets of the
Project Entities, including the Completed Properties, shall be distributed in
dissolution to the Partnership and the Existing Loans shall be assumed by the
Partnership subject to the nonrecourse provisions thereof.
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3. COVENANT TO CONTRIBUTE. Contributors hereby covenant and agree to
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contribute the Completed Properties to the capital of the Partnership pursuant
to the structure outlined in Section 2 of this Agreement and in accordance with,
and subject to, the other terms and conditions of this Agreement. The
Partnership hereby covenants and agrees to accept contribution of the Completed
Properties to its capital pursuant to the structure outlined in Section 2 of
this Agreement and in accordance with, and subject to, the other terms and
conditions of this Agreement.
4. CONTRIBUTION VALUE. The Contribution Value for each Completed Property
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is set forth on Exhibit G hereto, and the total of all such Contribution Value
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is Ninety Six Million Six Hundred Thousand and No/100 Dollars ($96,600,000).
5. ADJUSTED CONTRIBUTION VALUE. After determination of the Contribution
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Value of a Completed Property, such Contribution Value shall be subject to the
following further prorations, allocations and adjustments, all as of the Closing
Date (the "Adjusted Contribution Value"):
5.1 Rent Concession. The Contribution Value shall be reduced by the
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amount of free rent concessions unexpired as of the Closing Date, to the extent
that it was not taken into account in reaching the Contribution Value.
5.2 Standard Adjustments and Prorations. The following adjustments
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and prorations shall be made:
5.2.1 Rent and Security Deposits. The Project Entities shall
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be entitled to all rents [including any additional rent and any
accrued tax and operating expense reimbursements, subject to clause
(ii) below], charges, and other revenue of any kind attributable to
any period under the Leases or otherwise up to but not including the
Closing Date. The Partnership shall be entitled to all rents
[including any additional rent and any accrued tax and operating
expense reimbursements, subject to clause (ii) below], charges and
other revenue of any kind attributable to any period under the Leases
or otherwise on and after the Closing Date. Rents and expense
escalations or other reimbursements due the Project Entities under the
Leases collected prior to the Closing Date and attributable to both
the Project Entity's and the Partnership's periods of ownership shall
be prorated as of the Closing Date. Uncollected rents and expense
escalations or other reimbursements due the Project Entities under the
Leases shall not be prorated at the time of contribution, but the
Partnership shall include such amounts in its monthly billing
statements to the Tenants, make reasonable efforts to collect the same
and tender the same to the appropriate H.S. Lichtin, as agent for the
Contributors, upon receipt, provided that all rents, escalations and
other reimbursements due the Project Entities under the Leases
collected by the Partnership on or after the Closing Date shall be
prorated as of the Closing Date and shall first be applied to all
amounts due under the Leases at the time of collection (i.e., current
rents, delinquent rents attributable to periods after Closing and sums
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due the Partnership as the current owner and landlord) with the
balance (if any) payable to the appropriate Contributor, but only to
the extent of amounts delinquent and actually due the Project Entity.
No Contributor shall have any right to sue any Tenant under the Leases
for sums due a Project Entity for periods attributable to the Project
Entity's ownership of the Completed Property. The Contribution Value
shall not be reduced for Security Deposits, provided some are
transferred to the Partnership at contribution. With regard to the
Lease with Ganymeed Software in the 1100 Perimeter Park West Completed
Property pursuant to which that tenant has funded on escrow of $65,000
to secure its performance under that Lease, at the contribution of
that Completed Property to the Partnership, the Contributors agree to
cause their escrow to replace the Project Entity with Partnership as
the Landlord under the escrow documents. The Contribution Value shall
be reduced by pre-paid rentals held by the Project Entity under the
Leases.
5.2.2. Real Estate Taxes. Real estate taxes shall be prorated
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as of the Closing Date. The Project Entity shall be responsible for
all real estate taxes attributable to the Completed Property to, but
not including the, Closing Date. If the real estate tax rate and
assessments have not been set for the year in which the contribution
occurs, then the proration of such taxes shall be based upon the rate
and assessments for the preceding tax year, and such proration shall
be adjusted in cash between the Contributors and the Partnership upon
presentation of written evidence that the actual taxes paid for the
year in which the Closing occurs differ from the amounts used at
contribution. Notwithstanding the foregoing, the Contribution shall be
entitled to a refund of their proportionate share of such taxes for
which the project Entity has not been reimbursed by Tenants, to the
extent the Partnership after Closing recovers an increase in taxes
attributable to the year in which contribution occurs form the Tenants
under the Lease, and the Partnership agrees to conduct an annual
reconciliation of tax "pass-through" for the tax year of Closing in
accordance with the terms of the Leases.
5.2.3. Operating Expenses. Operating expenses for the Completed
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Property shall be prorated as of the Closing Date. The Project Entity
shall pay all utility charges and other operating expenses
attributable to the Completed Property for the period prior to but not
including the Closing Date (except for those utility charges and
operating expenses payable by Tenants in accordance with the Leases)
and the Partnership shall pay all utility charges and other operating
expenses attributable to the Completed Property for the period on or
after the Closing Date. Notwithstanding the foregoing, the Contributor
shall be entitled to a refund of their proportionate share of such
operating expenses for which the Project Entity has not been
reimbursed by Tenants, to the extent the Partnership after Closing
recovers an increase in operating expenses attributable to the year in
which contribution occurs from the Tenants under the Leases, and the
Partnership agrees to conduct an annual reconciliation of operating
expenses "pass-through" for the year of Closing in accordance with the
terms of the Leases. The Project Entity shall assign to the
Partnership any deposits which it has with any of the utility services
or companies servicing the Completed Property. The Partnership shall
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arrange with such services and companies to have accounts transferred
in the Partnership's name as of the day following the Closing Date, as
soon as is reasonably practicable after the Closing Date.
5.2.4. Existing Loans. With regard to the Existing Loans
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encumbering the Completed Property, (i) the Contribution Value shall
be reduced by the outstanding principal balance of the Existing Loan
as of the Closing Date; (ii) the Contribution Value shall be reduced
by the amount of accrued but unpaid interest due under the Existing
Loan attributable to any period up to, but not including, the Closing
Date; and (iii) the Contribution Value shall be increased by the
amount of any tax, insurance premium or other escrow deposits
maintained pursuant to the Existing Loan Documents to the extent
ownership of such deposits are transferred to the Partnership.
5.2.5. Unfunded Leasing Obligations. With respect to Leases
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entered into before July 10, 1996, for which tenant improvement costs
and lease commissions, are not yet fully paid or amortized, the
Contribution Value of a Completed Property shall be reduced by the
total of all such unpaid or unamortized tenant improvements costs or
lease commissions. With respect to Leases entered into on or after
July 10, 1996, with the Partnership's prior written approval, the
Contribution Value of the Completed Property shall not be reduced for
any such unpaid or unamortized tenant improvement costs or lease
commissions and the Partnership shall reimburse the Contributors for
tenant improvement cost and lease commissions paid by the Project
Entities under such approved Lease; provided, however, if the term of
any such Lease commences before the Closing Date, then the
Contribution Value of the Completed Property shall be reduced by that
portion of such unpaid or unamortized tenant improvement costs or
lease commissions attributable on a straight-line basis to the portion
of the term that expired before the Closing Date [e.g., if two (2)
months of a thirty-six (36) month term expires prior to the Closing
Date, the Contribution Value shall be reduced by an amount equal to
1/18th of such costs].
5.2.6. Delayed Adjustment. If at any time following the Closing
Date the amount of an item listed in Section 5.2 shall prove to be
incorrect, the party in whose favor the error was made shall promptly
pay to the other party the sum necessary to correct such error upon
receipt of proof of such error, provided that such proof is delivered
to the party from whom payment is requested on or before one (1) year
after the Closing Date.
5.3 Other Adjustments. The Contribution Value of a Completed Property
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shall be adjusted for other matters for which express provision is made in
this Agreement such as pursuant to Subsection 7.2.4.2., Section 9.1 and
Section 15.
5.4 Optional Cash Payments. Notwithstanding any provision of this
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Section 5 to the contrary, the Contributors and the Partnership may elect
to not adjust the Contribution Values of the Completed Properties as
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provided in Subsection 5.2.1, 5.2.2, 5.2.3, 5.2.5 and clauses (ii) and
(iii) of Subsection 5.2.4 and may elect, in lieu of such adjustment, to
make appropriate cash payments to each other. If the parties elect to make
cash payments in lieu of such adjustments, the parties agree to make such
cash payments to each other, as appropriate, within sixty (60) days after
the Closing Date (such payments to be based on the amount of such
adjustments determined as of the Closing Date as provided in said
subsections).
6. CASH PAYMENTS AND ISSUANCE OF UNITS. At the Closing, the
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Partnership shall make cash payments and issue Units to the Contributors as
provided in this Section 6.
6.1. Cash Payments. The Partnership shall wire transfer federal
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funds available for immediate credit on the Closing Date, to accounts
designated in writing by the Contributors, amounts not to exceed in the
aggregate Nine Million Dollars ($9,000,000) in accordance with the Closing
Statement, executed by the Partnership and Weeks, dated of even date
herewith.
6.2. Issuance of Units . For each Completed Property, to the extent
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of the excess of the Adjusted Contribution Value of that Completed Property
over the total of all cash payments allocated to that Completed Property
pursuant to Section 6.1, the Partnership shall issue to each of the
Contributors who held an ownership interest in the Project Entity for that
Completed Property, pro rata in accordance with their respective ownership
interests in that Project Entity, a number of Units equal to the quotient
of such excess divided by Twenty-Five Dollars and Twenty-Five Cents
($25.25), as set forth in the Closing Statement, executed by the
Partnership and Weeks, dated of even date herewith. Units issued by the
Partnership to the Contributors pursuant to this Agreement shall be held by
the Contributors subject to the terms and conditions of the Partnership
Amendment and the Rights Agreement. Notwithstanding any provision of this
Agreement to the contrary, no fractional Units shall be issued to a
Contributor pursuant to this Agreement. If as a result of the application
of the foregoing formulas, a fractional Unit is due a Contributor, the
Partnership shall pay to that Contributor, in cash on the Closing Date with
the wire transfer specified in Section 6.1, an amount equal to that
fractional Unit times Twenty-Five Dollars and Twenty-Five Cents ($25.25).
7. EXISTING LOANS.
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7.1. Assumption. Subject to Section 7.2 hereof, the Partnership
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agrees to accept title to the Completed Properties encumbered by the lien
and security interest created by the Existing Loan Documents in favor of
the Lenders and to assume, subject to the limited recourse provisions
therein contained, the respective obligations of the Project Entities under
the Existing Loan Documents (as modified as provided in Section 7.2
hereof). In the Partnership Amendment, the Partnership shall agree to
indemnify and hold harmless the Contributors for any liability they may
have under any personal guarantees or customary exceptions to nonrecourse
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provisions contained in the Existing Loan Documents for claims based on
matters that occur on or after the Closing Date.
7.2. Conditions. The Partnership's agreement to assume the Existing
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Loans, as provided in Section 7.1 hereof, is subject to satisfaction, in
the Partnership's reasonable determination, of the following conditions:
7.2.1. Approval. During the Inspection Period, the Partnership
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shall have reviewed and approved the Existing Loan Documents.
7.2.2. Estoppel. On or before Closing, the Partnership shall
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receive from each Lender as to each Existing Loan it holds an estoppel
and consent agreement in form and content reasonably acceptable to the
Partnership confirming, among such other matters as the Partnership
may reasonably require, that Lender is the holder of the Existing Loan
Documents for that Existing Loan, the outstanding principal balance of
that Existing Loan, that no default is then outstanding, identifying
the Existing Loan Documents, confirming the amounts of any tax and
insurance escrows, and consenting to the contribution of the Completed
Property as provided in this Agreement and the assumption by the
Partnership, subject to the limited recourse provision therein
contained, of that Existing Loan.
7.2.3. Loan Modification. On or before Closing, an agreement
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from each Lender to modification of the Existing Loan Documents it
holds to reflect change in ownership (e.g., financial reporting
requirements, transfer restrictions, deletion of any personal
covenants specific to Lichtin Properties, Inc. and other matters
developed by the Partnership from review of the Existing Loan
Documents).
7.2.4. Renegotiation of Terms. The Contributors, at their sole
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cost and expense, shall have obtained the following agreements from
certain Lenders to the following matters:
7.2.4.1. Aetna Life Insurance Company shall agree to permit
early prepayment of the Existing Loan held by or, separately or
together, at par, and without penalty or prepayment fee of any
kind, at any time on or after the Closing Date.
7.2.4.2. The Independent Order of Forestus shall agree to a
reduction of the interest rate to eight and one-quarter percent
(8.25%).
7.2.4.3. New England Mutual Life Insurance Company shall
agree to either (i) permit early prepayment of the Existing Loan
held by it, at par, and without penalty or prepayment fee of any
kind, at any time on or after the Closing Date, or (ii) a
reduction of the interest rate to eight and one-quarter percent
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(8.25%). If after reasonable efforts the Contributors are unable
to obtain the agreement of New England Mutual Life Insurance
Company to either prepayment at par or an interest rate reduction
as described in the immediately preceding sentence, in lieu of
such renegotiated terms, the number of Units to be issued to the
Contributors for the 1000 Perimeter Park Completed Property shall
be reduced by Seven Thousand Four Hundred Twenty-Six (7,426)
Units (such reduction to be allocated to each such Contributor
pro rata in accordance with their respective ownership interests
in Perimeter Park Associates).
7.2.4.4. First Union National Bank of North Carolina shall
agree to release the land at the project known as "Perimeter Park
West" from its trust deed securing its line of credit to Lichtin
Properties, Inc.
Any condition imposed by the Lenders for agreement to the above
described renegotiated terms (other than the payment of money which
shall be the obligation of the Contributors and not the Partnership)
shall be subject to the prior written approval of the Partnership.
8. CLOSING.
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8.1. Time and Place of Closing. The Closing shall commence at 9:00
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a.m., EST, on the Closing Date at the offices of Kennedy Covington Lobdell &
Hickman, L.L.P., Two Hanover Square, Suite 1900, 434 Fayetteville Street Mall,
Raleigh, North Carolina 27602-1070, or such other place as is agreed upon by
the Partnership and the Contributors. The Closing Date shall be as of the date
of this Agreement, unless extended by agreement of the Partnership and the
Contributors or by an express provision of this Agreement.
8.2. Closing Costs. The Partnership shall pay for title examination,
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title insurance, engineering and environmental audits, surveys, its legal fees,
the fees and expenses of its accounting, auditing and tax advisors and one-half
( 1/2) of the cost of the audit of the books and records of Lichtin Properties,
Inc. and the Project Entities conducted by Arthur Andersen & Co. The
Contributors shall pay any transfer fees, interest prepayments, legal fees and
expenses and any and all other charges imposed by any Lender as a result of the
matters described in Article 7 of this Agreement, any transfer fees imposed on
the Transaction, its legal fees, the fees and expenses of its accounting, audit
and tax advisors and one-half ( 1/2) of the cost of the audit of the books and
records of Lichtin Properties, Inc. and the Project Entities conducted by Arthur
Andersen & Co. Brokerage fees shall be paid as provided in Article 18 hereof.
Any other closing cost shall be borne by the party who customarily bears such
cost under the prevailing rules of practice in the State of North Carolina.
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9. TITLE EXAMINATION AND OBJECTIONS; FAILURE TO CURE.
-------------------------------------------------
9.1. Title Examination and Survey. The Partnership shall have until the
----------------------------
Closing Date to examine the title to the Real Property, to cause the Surveys of
the Real Property to be made, and to furnish the Contributors with a written
statement of defects in such title (other than Permitted Exceptions). If the
Partnership furnishes the aforesaid written notice or notices within the
permitted time, the Contributors shall have until five (5) business days after
receipt thereof in which to indicate to the Partnership which of the title
objections raised by the Partnership the Contributors will cure and those which
they decline to cure; provided, however, the Contributors must cure all monetary
encumbrances affecting title to the Real Property such as trust deeds,
mortgages, judgment liens, liens for materialmen or mechanics, broker liens and
delinquent taxes except the lien of the Existing Loan Documents. The
Contributors shall have until the Closing Date the right, but not the obligation
(except for those items the Contributors expressly elects in writing to cure and
all monetary encumbrances except the Existing Loans ), to satisfy or cure all
title objections of which it was timely notified by the Partnership; provided,
however, that the Contributors, upon written notice to the Partnership, may
postpone the Closing by sixty (60) days in order that such title objections
might be cured.
9.2. Failure to Cure Title Objections. Should the Contributors fail to
--------------------------------
satisfy or cure all such title objections by the Closing Date, as postponed, if
appropriate, then the Partnership shall have as its sole right and remedy, at
the Partnership's election to be made on or before the Closing Date, (i) in the
case of an uncured monetary encumbrance, to proceed to close the purchase of the
Completed Properties with a corresponding reduction in Contribution Values for
the cost to cure the monetary encumbrances; (ii) to terminate this Agreement; or
(iii) to waive those title objections which the Contributors failed to satisfy
or cure and proceed to close the sale of the Completed Properties contemplated
herein and accept the Real Property subject to such title objections with no
reduction in the Purchase Price. Notwithstanding anything contained in this
Article 9, if the Contributors' failure to contribute (pursuant to the structure
outlined in Section 2) marketable and insurable title to the Completed
Properties subject only to the Permitted Exceptions results from a willful act
or omission of the Contributors in default of its obligations hereunder, the
Partnership shall be entitled to all remedies available to the Partnership under
Section 17.1.
10. ACCESS TO AND EXAMINATION OF THE COMPLETED PROPERTIES; CONDITION OF
-------------------------------------------------------------------
THE COMPLETED PROPERTIES.
- ------------------------
10.1. Access and Examination. The Partnership, personally or through
----------------------
agents, employees or contractors, may go upon the Completed Properties during
normal business hours prior to Closing to conduct such soil, engineering,
environmental and other tests, investigations and analyses of the Land and
Improvements as the Partnership deems desirable and to review and make
photocopies of the Leases, lease commission agreements, Service Contracts,
amendments, contracts and plans and specifications relating to or affecting the
Completed Properties. The Partnership shall pay all costs incurred in making
such tests, analyses, copies, and investigations. In no event shall the
Partnership conduct any intrusive or destructive tests, analyses, or
12
<PAGE>
investigations of the Completed Properties without first obtaining the written
consent from the appropriate Project Entity, which will not be unreasonably
withheld. The Partnership acknowledges that any such examinations or inspections
of the Completed Properties pursuant to this Section 10.1 or otherwise are
subject to the rights of all Tenants, and the Partnership agrees to conduct such
inspections or examinations in such a manner so as to honor the rights of the
Tenants and to prevent disruption of the ordinary operation of the Tenants'
business on the Completed Properties. The Partnership agrees to repair any
damage to the Completed Properties resulting or relating to such inspection or
examination and agrees to and does hereby indemnify, defend, and hold the
Contributors and the Project Entities harmless from any personal injury, death,
damage to property, damages, liens, claims, losses, and liabilities arising out
of the Partnership's exercising such right and privilege to go upon the
Completed Properties, including the acts and omissions of the Partnership's
employees, agents, contractors and consultants (but under no circumstances shall
the Partnership be liable to the Contributors for consequential damages
attributable to the results or findings of such tests). The Partnership's
indemnity under this Section 10.1 shall survive any rescission, cancellation, or
termination of this Agreement.
10.2. The Partnership's Condition. The Partnership's obligations under this
---------------------------
Agreement are subject to and conditioned upon the Partnership's determination,
in the Partnership's sole discretion on or before the Inspection Date, that the
Completed Properties are acceptable, in all respects, to the Partnership for
investment. If the condition set forth in this Section 10.2 is not satisfied or
waived in writing by the Partnership on or before the Inspection Date, then this
Agreement shall automatically terminate unless the Partnership delivers written
notice to the Contributors on or before the Inspection Date advising the
Contributors that the condition set forth in this Section 10.2 has been fully
satisfied. If this Agreement is terminated pursuant to this Section 10.2, the
parties hereto shall have no further rights, duties or obligations under this
Agreement, except for obligations which are by their express term to survive
termination.
11. REPRESENTATIONS AND WARRANTIES OF CONTRIBUTORS. The Contributors
----------------------------------------------
jointly and severally represent and warrant to the Partnership the following:
11.1. Organization; Authority. Each of the Project Entities is duly formed,
-----------------------
validly existing and in good standing under the laws of the State of North
Carolina. Each Contributor that is a trust is duly formed, validly existing and
in good standing under the laws of the State of North Carolina and has the
requisite authority to enter into and perform this Agreement. The individuals
and trusts identified on Exhibit L hereto immediately prior to the Closing, will
---------
be the only general partners, members and limited partners, as applicable, of
the Project Entities.
11.2. Due Authorization; Binding Agreement. The execution, delivery and
-----------------------------------
performance of this Agreement by the Contributors who are trusts has been duly
and validly authorized by all necessary action of these Contributors. This
Agreement has been duly executed and delivered by the Contributors and
constitutes a legal, valid and binding obligation of the Contributors,
enforceable against the Contributors in accordance with the terms hereof (except
as enforcement may be limited by bankruptcy, insolvency or other laws affecting
enforcement of creditors' rights generally and general equity principles).
13
<PAGE>
11.3. Governmental Consents. Except as has been obtained or is being
---------------------
effected as part of the consummation of the Transaction, no consent, waiver,
approval or authorization of, or filing, registration or qualification with, or
notice to, any governmental unit or any other regulatory body is required to be
made, obtained or given by the Contributors or the Project Entities in
connection with the execution, delivery and performance of this Agreement by the
Contributors or the Project Entities.
11.4. Other Consents. Except for waivers and consents that have been
--------------
obtained prior to the date hereof, except as provided in Article 7 hereof, and
except as would not have a material adverse effect on any of the Completed
Properties, no consent of any party to any agreement, contract, mortgage,
indenture, lease, reciprocal easement or operating agreement or other
arrangement, to which the Contributors is a party, or, by which the Contributors
is bound, is required in connection with the execution, delivery or performance
by the Contributors of this Agreement or the consummation of the transactions
provided for herein.
11.5. No Violation. None of the execution, delivery and performance of this
------------
Agreement by the Contributors does or will, with or without the giving of
notice, lapse of time or both, (i) violate, conflict with or constitute a
default under any term or condition of (A) the organizational documents of the
Contributors who are trusts or of the Project Entities, or (B) any term or
provision of any judgment, decree, order, statute, injunction, rule or
regulation of a governmental unit applicable to the Contributors or the Project
Entities or any agreement, contract, mortgage, indenture, lease, reciprocal
easement or operating agreement or other arrangement to which any Contributor or
Project Entity is a party or by which it is bound or to which any of its assets
or any of the Completed Properties is subject, except as provided in Article 7
and except in the case where appropriate waivers and consents have been obtained
prior to the date hereof, and except as would not have a material adverse effect
on the Contributors or any of the Completed Properties, or (ii) result in the
creation of any lien or other encumbrance upon the assets of the Contributors or
any of the Completed Properties, except as may be contemplated by this Agreement
or the other Transaction Documents, and except as would not have a material
adverse effect on the Project Entities or any of the Completed Properties.
11.6 Compliance with Laws. The Project Entities have complied with all laws
--------------------
applicable to the conduct of the business of the Contributors and to the
ownership, use and operation of the Completed Properties and have obtained all
licenses and permits required for the conduct thereof, except where the failure
to so comply or obtain will not have a material adverse effect on the Project
Entities or any of the Completed Properties. To the Contributors' knowledge,
such licenses and permits are in full force and effect, the Contributors and the
Project Entities have not taken any action that would (or failed to take any
action the omission of which would) result in the revocation of such licenses or
permits, and the Contributors and the Project Entities have not received any
notice of violation from any federal, state or municipal entity or written
notice of an intention by any such government entity to revoke any certificate
of occupancy or other certificate, license or permit issued by it in connection
with the use of any of the Completed Properties, that in each case has not been
14
<PAGE>
cured or otherwise resolved to the satisfaction of such government entity,
except where such failure or such action will not have a material adverse effect
on the Project Entities or any of the Completed Properties.
11.7. Investment.
----------
11.7.1. Each Contributor is acquiring Units for its own account and
not with a view to, or for sale in connection with, the "distribution", as
such term is used in Section 2(11) of the Securities Act of 1933, as amended
(the "Securities Act"), of any of the Partnership Units in violation of the
Securities Act.
11.7.2. Each Contributor is an "accredited investor", as that term
is defined in Rule 501(a) of Regulation D promulgated under the Securities
Act.
11.7.3. Each Contributor understands that the Units have not been
registered under the Securities Act by reason of a specific exemption from
the registration provisions of the Securities Act which depends upon, among
other things, the nature of the investment intent and the accuracy of such
Contributor's representations as expressed herein.
11.8. Access to Data. Each Contributor has had an opportunity to
--------------
discuss the Partnership's business, management and financial affairs with the
Partnership's management and the opportunity to review the Partnership's
financial records.
11.9. No Public Market. Each Contributor understands and
----------------
acknowledges that no public market now exists for any of the securities issued
by the Partnership and that there can be no assurance that a public market will
ever exist for the Units.
11.10. Experience; Risk. Each Contributor has such knowledge and
----------------
experience in financial and business matters that each Contributor is capable of
evaluating the merits and risks of the purchase of the Units pursuant to this
Agreement and of protecting each Contributor's interests in connection herewith.
11.11. Environmental. The Project Entities have not knowingly caused
-------------
or permitted any Hazardous Material to be improperly maintained or disposed of
on, under or at any of the Completed Properties or any part thereof. To the
Contributors' knowledge, and except as may be revealed in the Environmental
Reports (which are identified in Exhibit N): (i) no liability under or violation
of any Environmental Laws exists with respect to the Completed Properties, (ii)
the Contributors and the Project Entities have not received any written notice
from any governmental agency or instrumentality having jurisdiction thereof of
any violation of any Environmental Laws that remains uncured as of the date
hereof or that it has any material liability with respect thereto, (iii) there
are no administrative, regulatory or judicial proceedings pending or threatened
against the Project Entities pursuant to, or alleging any material violation of,
or material liability under any Environmental Laws, (iv) none of the properties
15
<PAGE>
now or heretofore owned, leased or used by the Project Entities has been used as
a storage or disposal site (whether temporary or permanent) for any hazardous,
toxic or dangerous materials the storage or disposal of which is governed by any
Environmental Laws in violation of such Environmental Laws (v) there are no
underground storage tanks located on, under or about any of the Completed
Properties, and there is no facility located on or at any of the Completed
Properties that is subject to the reporting requirements of Section 312 of the
Federal Emergency Planning and Community Right to Know Act of 1986 and the
federal regulations promulgated thereunder (42 U.S.C. (S) 11022), and (vi) no
Hazardous Material has been improperly maintained or disposed of on under or at
any of the Completed Properties or any part thereof. In connection with the
representations and warranties in this Section 11.7, the Partnership
acknowledges that the Contributors disclaims any professional expertise with
respect to Environmental Laws.
11.12. Ownership of the Completed Properties. With respect to the
-------------------------------------
Completed Properties, the Project Entities (i) are the sole owner and (ii) have
good, valid and marketable title, free and clear of all Liens other than the
following:
11.12.1. Liens, or deposits made to secure the release of such
Liens, securing taxes, the payment of which is at the time not
delinquent or the payment of which is actively being contested in good
faith by appropriate proceedings diligently pursued, and for which
appropriate reserves shall have been established by the Project
Entities.
11.12.2. Attachments, judgments and other similar Liens arising in
connection with court or administrative proceedings, provided, that the
execution or other enforcement of such Liens is effectively stayed or
secured and the claims secured by such Liens are actively being
contested in good faith by appropriate proceedings diligently pursued,
and for which appropriate reserves shall have been established by the
Project Entities.
11.12.3. Zoning laws and ordinances; provided that, to the
Contributors' knowledge, none of the Completed Properties are in
violation thereof, in any material respect, and that such laws and
ordinances do not require the demolition, vacation or cessation of the
use for industrial or office purposes (as applicable) of any portion of
the improvements material to each of the Completed Properties or require
the discontinuance of the use of all or any material portion of any of
the Completed Properties as industrial facilities or office buildings.
11.12.4. Any laws, ordinances, deeds of trust, mortgages, Liens,
easements, rights of way, restrictions, exemptions, reservations,
conditions, limitations, covenants, encumbrances, adverse rights or
interests and other matters defined as Permitted Exceptions; provided
that, to the Contributors' knowledge, the Completed Properties are not
in violation thereof in any material respect and the same do not require
the demolition, vacation or cessation of the use of for industrial or
office purpose of any portion of the improvements material to such
Completed Properties or require the discontinuance of the use of all or
16
<PAGE>
any material portion of such Completed Properties as industrial
facilities or office buildings.
11.12.5. Any other easements, rights of way, restrictions,
exceptions, reservations, conditions, limitations, covenants, adverse
rights or interests, licenses, minor irregularities in title and other
similar encumbrances which do not in the aggregate materially impair the
use of such properties in the operation of the business of the Project
Entities.
11.12.6. Any law or governmental regulation or other right of any
governmental unit, which (i) requires the person to maintain certain
facilities or perform certain acts as a condition of its occupancy or
use of its assets and properties, or (ii) condemns, appropriates or
recaptures the person's assets or property.
11.12.7. Liens imposed by laws, such as carriers', warehousemen's
and mechanics' Liens and other similar Liens arising in the ordinary
course of business which secure payment of obligations not more than
sixty (60) days past due or which are being contested in good faith by
appropriate proceedings diligently pursued, and for which appropriate
reserves shall have been established by the Project Entities.
11.13. Zoning; Other Laws. The Project Entities have not received any
------------------
written or other actual notice of any violation of any applicable zoning
regulation or ordinance, or of any employment or other regulatory law,
order, regulation or requirement relating to the Project Entities'
operations, practices, properties or assets that remain uncured as of the
date hereof, and, to the Contributors' knowledge, there are no such
violations that, individually or in the aggregate, will have a material
adverse effect on any of the Completed Properties.
11.14. Absence of Undisclosed Liabilities and Contractual Obligations.
--------------------------------------------------------------
The Project Entities have no liabilities of any nature, whether matured or
unmatured, fixed or contingent, regardless of whether the disclosure thereof
would otherwise be required by GAAP, which would have, individually or in the
aggregate, a material adverse effect upon any of the Project Entities or any of
the Completed Properties except for (1)Leases identified on the Rent Roll, (2)
the Potential Commission Obligations, (3) Existing Loan Documents, (4) the
Permitted Exceptions and (5) the Service Contracts (collectively, the
"Significant Agreements"), or as shown on the audits of the books and records
described in Section 8.2 hereof.
11.15. Existing Loans. With respect to the Existing Loans, the
--------------
Contributors represent and warrant as follows:
11.15.1. The loan documents identified on Exhibit O hereto
---------
constitute all of the documents that evidence or secure the Existing
Loans; and such documents have not been amended or modified except as
expressly identified on said Exhibit O. The Contributors have delivered
---------
17
<PAGE>
to the Partnership true, correct and complete copies of all of the
Existing Loan Documents.
11.15.2. All payments due and payable on or before the date of
this Agreement under the Existing Loan Documents by the Project
Entities, or any of its predecessor entities, have been paid, and no
monetary default exists as of the date of this Agreement.
11.15.3. As of the date of this Agreement, no written notice of
a default is outstanding and, to the knowledge of any of the
Contributors, no condition exists which with the giving of notice or the
passage of time or both would constitute an event of default under the
Existing Loan Documents.
11.16. Significant Agreements; Binding Agreements. Each of the
------------------------------------------
Significant Agreements referred to in Subsection 9.14 above is (to the
Contributors' knowledge, with respect to parties thereto other than the Project
Entities) valid and binding and in full force and effect, enforceable against
the parties thereto in accordance with its terms (except as enforcement may be
limited by bankruptcy, insolvency or other laws affecting enforcement of
creditors' rights generally and general equitable principles).
11.17. Litigation. Other than as set forth in Exhibit P hereto, there
---------- ---------
are no claims, actions, suits, proceedings or investigations pending, or, to the
Contributors' knowledge, threatened, before any court, governmental unit or
arbitrator with respect to any Project Entity or any Completed Property, and, to
the Contributors' knowledge, the likely outcome of the claims or other matters
set out in said Exhibit P, will not have a material adverse effect on the
---------
Contributors or any of the Completed Properties.
11.18. Tax Classification. Each Project Entity is classified as a
------------------
partnership for federal income tax purposes and not as an association taxable as
a corporation.
11.19. Rent Roll. The Rent Roll attached hereto as Exhibit U for the
--------- ---------
Completed Properties is true, correct and complete with respect to the
categories described therein, except to the extent any inaccuracies would not,
individually or in the aggregate, have a material adverse effect on the value of
any of the Completed Properties.
11.20. Leases. The Rent Roll identifies each of the Leases in effect
------
as of the date of the Rent Roll with respect to the Completed Properties. In the
case of any sublease or assignment of any such Lease, the Tenant listed in such
Rent Roll remains liable for the performance of said Lease.
11.21. Improvements. Except as disclosed in the Engineering Reports
------------
listed in Exhibit Q, attached hereto and by this reference made a part hereof,
---------
the Improvements are in good condition and repair and have not suffered any
material casualty or, to the Contributors' knowledge, other material damage that
18
<PAGE>
has not been repaired in all material respects. To the Contributors' knowledge,
there is no material latent or patent structural, mechanical or other
significant defect or deficiency in the Improvements, other than as disclosed in
said Engineering Reports.
11.22. Condemnation. No proceedings have been commenced, or, to the
------------
Contributors' knowledge, threatened, by any authority having the power of
eminent domain to condemn any part of any of the Completed Properties or any
Improvements thereon that, if successful, would have a material adverse effect
on any of the Completed Properties.
11.23. Bankruptcy and Insolvency. To the Contributors' knowledge, none
-------------------------
of the Tenants now occupying the Completed Properties or having a Lease of space
in the Completed Property is the subject of any bankruptcy, reorganization,
insolvency or similar proceedings.
11.24. Insurance. Exhibit R, attached hereto and by this reference
--------- ---------
made a part hereof, sets forth an accurate and complete list of the insurance
policies relating to the Completed Properties or any part thereof obtained by
and naming the Project Entities (other than policies obtained or maintained by
tenants); all such policies are in full force and effect and all premiums
thereunder have been paid to the extent due; and no notice of cancellation has
been received with respect thereto and, to the Contributors' knowledge, none is
threatened.
11.25. Full Disclosure. No representation or warranty by the
---------------
Contributors herein contains any untrue statement of a material fact or omits to
state a material fact necessary in order to make the statements contained
herein, in light of the circumstances under which they were made, not
misleading.
11.26. Ownership Interest in Tenants. Except for First Class Day Care
-----------------------------
Center, Inc., none of the Project Entities, its general partners, limited
partners or members, as applicable, owns, directly or indirectly, (i) one
percent (1%) or more of the total combined voting power of all classes of stock
entitled to vote, or one percent (1%) or more of the total number of shares of
all classes of stock, of any corporation that is a Tenant or (ii) an interest of
one percent (1%) or more in the assets or net profits of any Tenant. H. S.
Lichtin covenants to sell his interest in First Class Day Care Center, Inc. as
of December 31, 1996.
11.27. Tenant Operations. The Project Entities have not received
-----------------
written notice that any Tenant intends either to cease such operations (other
than temporarily due to casualty, remodeling, renovation or any similar cause)
or to cease operating under the name under which it was operating as of the date
hereof.
11.28. Lease Defaults. To the Contributors' knowledge, no condition
--------------
exists which, with the giving of notice or the passage of time, or both, would
permit any party to cancel its obligations under any reciprocal easement
agreement or Lease.
19
<PAGE>
11.29. Incomplete Improvements. Except for routine repairs and
-----------------------
maintenance, all alterations, improvements or other work required to have been
completed by any of the Project Entities under any reciprocal easement
agreements and Leases, including, without limitation, all alterations,
improvements and other work required to prepare space for the initial occupancy
of each tenant under a Lease, has heretofore been completed and paid for in
full, except to the extent reflected in Exhibit S, attached hereto and by this
---------
reference made a part hereof.
11.30. Integrated Facilities. Each of the Completed Properties is an
---------------------
independent unit which does not now rely on any facilities (other than
facilities covered by Permitted Exceptions including, without limitations, any
reciprocal easement agreements or facilities of municipalities or public utility
and water companies and other than parking areas which the Completed Properties
make use of under any reciprocal easement agreements) located on any property
not included in the Real Property that is part of that Completed Property to
fulfill any municipal or governmental requirement or for the furnishings to the
Completed Properties of any essential building systems or utilities.
11.31. Agreement Violations. The Project Entities have not received
--------------------
any written notice which is still in effect that there is, and, to the
Contributors' knowledge, there does not exist, any violation of a condition or
agreement contained in any easement, restrictive covenant or any similar
instrument or agreement affecting the Completed Properties or any portion
thereof, if such violation would have a material adverse effect on any of the
Completed Properties.
11.32. Radius Restrictions. The Project Entities are not in violation
-------------------
of any radius restrictions, exclusive or similar provisions contained in any
reciprocal easement agreements, Leases or any other agreements to which any of
the Project Entities is a party or is bound, if such violation would have a
material adverse effect on the Project Entities or any of the Completed
Properties.
11.33. Financial Status. Each of the Project Entities is solvent, has
----------------
not made a general assignment for the benefit of its creditors, and has not
admitted in writing its inability to pay its debts as they become due, nor has
any of the Project Entities filed, nor does it contemplate the filing of, any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings,
or any other proceeding for the relief of debtors in general, nor has any such
proceeding been instituted by or against any of the Project Entities, nor is any
such proceeding to the Contributors' knowledge threatened or contemplated.
11.34. Service Contracts. Attached hereto as Exhibit T is a schedule of
----------------- ---------
the Service Contracts now in effect to which the Project Entities and/or the
Completed Properties are subject. No notice of default has been received by the
Project Entities from any of the parties to the Service Contracts and, to the
Contributors' knowledge, no event has occurred which, with notice or lapse of
time, or both, will constitute any such default. There are no Service Contracts
affecting any of the Completed Properties other than as listed on Exhibit T, and
---------
the Service Contracts are in full force and effect.
20
<PAGE>
11.35. Lease Commissions. All leasing commissions payable in
-----------------
connection with the Leases now in occupancy have been paid-in-full, including
leasing commissions payable with respect to extensions, expansions and renewals
which have not been exercised as of the date hereof or payable in the event a
Tenant does not exercise a cancellation right under its Lease, except for the
Potential Commission Obligations.
11.36. No Contributor-Leased Space. The Contributors do not lease
---------------------------
space at the Completed Properties, and, except for the child day-care tenant, no
tenant at the Completed Properties is "related" to the Contributors or the
Project Entities within the meaning of Section 267(b) or Section 707(b) of the
Internal Revenue Code of 1986, as amended.
11.37. ERISA. No interest in the Completed Properties is or is deemed
-----
to be, directly or indirectly, an asset of a "Plan" (as defined in the next
sentence). "Plan" means an "employee benefit plan" as defined in Section 3(3) of
----
the Employee Retirement Income Security Act of 1974, as amended, or a "plan"
within the meaning of Section 4975(e)(1) of the Internal Revenue Code of 1986,
as amended.
11.38. Survival. The representations and warranties of the
--------
Contributors contained in this Article 11, as updated and reaffirmed at Closing,
shall continue in effect as provided in the Partnership Amendment.
12. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PARTNERSHIP. The
------------------------------------------------------------
Partnership represents and warrants to the Contributors, as follows:
12.1. Due Authorization. The Partnership is a limited partnership duly
-----------------
formed, validly existing and in good standing under the laws of the State of
Georgia. At Closing, the Partnership or its assignee will be qualified to
transact business in the State of North Carolina. The Partnership has full
power and authority to execute and deliver this Agreement and all other
documents executed and delivered, or to be executed and delivered, by it
(contemporaneously herewith or at the Closing) in connection with the
transactions described herein and to perform all of its obligations arising
under this Agreement and such other documents; the officers executing this
Agreement and such other documents on behalf of the Partnership have the
authority to bind the Partnership hereunder and thereunder.
12.2. Applicable Laws. Neither the execution and delivery of this
---------------
Agreement nor any other documents executed and delivered, or to be executed and
delivered by the Partnership (contemporaneously herewith or at the Closing) in
connection with the transactions described herein will violate any provision of
the Partnership's limited partnership agreement, articles of incorporation or
by-laws of the Partnership's General Partner or of any agreements, regulations,
or laws to which the Partnership is bound, except for waivers and consents that
have been obtained prior to the date hereof.
21
<PAGE>
12.3. Litigation and Other Proceedings. To the Partnership's knowledge,
--------------------------------
there is no action, suit, proceeding, or claim affecting the Partnership pending
or being prosecuted in any court or by or before any federal, state, county, or
municipal department, commission, board, bureau, agency, or other governmental
instrumentality which would prevent consummation by the Partnership of the
acquisition of the Completed Properties or materially and adversely affect the
performance of any of the Partnership's other obligations hereunder to be
performed prior to, at or after Closing.
12.4. Financial Status. The Partnership is solvent, has not made a
----------------
general assignment for the benefit of its creditors, and has not admitted in
writing its inability to pay its debts as they become due, nor has the
Partnership filed, nor does it contemplate the filing of, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or any other
proceeding for the relief of debtors in general, nor has any such proceeding
been instituted by or against the Partnership, nor is any such proceeding to the
Partnership's knowledge threatened or contemplated.
13. CONDITIONS.
----------
13.1. The Partnership's Conditions. In addition to any other conditions
----------------------------
provided in this Agreement, the Partnership's obligation to accept contribution
of the Completed Properties pursuant to this Agreement is subject to the
satisfaction of each of the following conditions at or prior to the Closing
Date.
13.1.1. The Contributors' Performance. The Contributors shall have
-----------------------------
complied with and performed all of their obligations and covenants set forth
in this Agreement.
13.1.2. The Contributors' Execution and Delivery. On or before the
----------------------------------------
Closing Date, the Contributors shall have executed and delivered all
documents required to be delivered by the Contributors pursuant to the terms
of this Agreement.
13.1.3. Representations and Warranties. All of the representations
------------------------------
and warranties made by the Contributors in Article 11 shall be true correct
at and as of the Closing Date as though such representations and warranties
were made both at and as of the date hereof and at and as of the Closing
Date. Provided, further, the representations and warranties set forth in
Sections 11.19 and 11.20 concerning Rent Roll and Leases, when reaffirmed at
Closing shall be made with respect to a Rent Roll made as of Closing and
such Rent Roll shall disclose no material changes from the Rent Roll
attached hereto as Exhibit U, except those approved by the Partnership in
---------
writing.
13.1.4. Tenant Estoppel Certificates. The Contributors shall have
----------------------------
obtained and delivered to the Partnership by the date and time of Closing a
Tenant Estoppel Certificate for each of the Leases (more than 20,000 square
feet) identified on Exhibit V hereto ("Major Leases") and for each of the
---------
Leases covering a total of at least ninety percent (90%) of the square
footage of the Completed Properties (1,273,098 square feet of area), each
duly executed by an authorized officer of the Tenant under such Lease and
dated no earlier than
22
<PAGE>
thirty (30) days before the Closing Date. The Contributors agree to use
diligent good faith efforts to obtain such Tenant Estoppel Certificates at
or prior to Closing. As to the square footage of the Completed Properties
not covered by a Tenant Estoppel Certificate, H.S. Lichtin shall execute and
deliver to the Partnership at Closing an estoppel certificate in the same
form as Exhibit J hereto, but modified to reflect that H.S. Lichtin is
---------
giving such certificate. Any material modification to the form of Tenant
Estoppel Certificate shall be approved in writing by the Partnership in
advance and, in the Partnership's discretion, may be the basis upon which
the Partnership excludes such certificate in the determination as to whether
this condition has been satisfied. During the term of this Agreement, as and
when received, the Contributors shall provide to the Partnership copies of
each Tenant Estoppel Certificate received from any Tenant promptly after
receipt of such Tenant Estoppel Certificate. The Partnership shall have the
right to extend the Closing Date by up to thirty (30) days by written notice
to the Contributors if the Contributors has not obtained estoppels for the
Major Tenants.
13.1.5. Adverse Change. No material adverse change shall have
--------------
occurred to any of the Completed Properties, except as otherwise provided in
Sections 15 and 16.
13.1.6. Other Transaction Documents. On or before the Closing Date,
---------------------------
all of the Transaction Documents, other than this Agreement, shall have been
duly authorized, executed and delivered by the parties thereto and all steps
of the Transaction contemplated in the Transaction Documents to be completed
contemporaneously with the Closing, shall be completed.
13.1.7. The Partnership's Benefit. The conditions set forth in this
-------------------------
Section 13.1 are for the sole benefit of the Partnership, and the
Partnership may elect to waive any such contingency reserved for its benefit
and proceed to consummate the transaction contemplated hereby. If the
condition set forth in Section 13.1.4 or the condition contained in
Subsection 13.1.3 (other than as a result of the Contributors' default) or
the condition contained in Section 13.1.5 (other than a material adverse
resulting from the intentional acts or willful misconduct of any of the
Contributors or any Project Entity or its agent and employees) or the
condition in Section 13.1.6 (other than as a result of a default by the
Contributors) has not been satisfied or waived within the required time then
the Partnership shall be entitled as its sole remedy to terminate this
Agreement by written notice to the Contributors on or prior to the date set
forth herein for the satisfaction of such condition, and upon the
Partnership giving the Contributors written notice of such election, this
Agreement shall terminate and the parties hereto shall have no further
rights or obligations hereunder, except for obligations which are by their
express provision are to survive termination. Otherwise, if the conditions
set forth in this Section 13.1 are not satisfied, the Partnership shall be
entitled to pursue its remedies hereunder as provided in Section 17.1.
13.2. The Contributors' Conditions. In addition to any other conditions
----------------------------
provided in this Agreement, the Contributors' obligation to contribute the
Completed Properties to the Partnership pursuant to this Agreement are subject
to the satisfaction of each of the following conditions:
23
<PAGE>
13.2.1. The Partnership's Performance. The Partnership shall have
-----------------------------
complied with and performed all of its obligations and covenants set forth
in this Agreement.
13.2.2. The Partnership's Execution and Delivery. On or before the
----------------------------------------
Closing Date, the Partnership shall have executed and delivered all
documents required to be delivered by the Partnership pursuant to the terms
of this Agreement, and shall have paid the cash payments and issued the
Units in the manner set forth in Article 6.
13.2.3. Other Transaction Documents. On or before the Closing Date,
---------------------------
all of the Transaction Documents, other than this Agreement, shall have been
duly authorized, executed and delivered by the parties thereto and all steps
of the Transaction contemplated in the Transaction Documents to be completed
contemporaneously with the Closing, shall be completed.
13.2.4. Representations and Warranties. All of the representations
------------------------------
and warranties made by the Partnership in Article 12 shall be true and
correct at and as of the Closing Date as though such representations and
warranties were made both at and as of the date hereof and at and as of the
Closing Date.
13.2.5. The Contributors' Benefit. The conditions set forth in this
-------------------------
Section 13.2 are for the sole benefit of the Contributors, and the
Contributors may elect to waive any such condition reserved for its benefit
and proceed to consummate the transaction contemplated hereby. If any
condition set forth in Subsections 13.2.1, 13.2.2, 13.2.3 or 13.2.4 (in the
case of Subsection 13.2.3 only if as a result of the Partnership default)
has not been satisfied or waived within the required time period, the
Contributors shall be entitled to pursue its remedies hereunder as provided
in Section 17.2.
14. OPERATIONS PRIOR TO CLOSING. Between the date hereof and the Closing
---------------------------
Date:
14.1. Repairs. Without expense to the Partnership, all repairs and
-------
replacements, structural and nonstructural, ordinary and extraordinary, which
are required with respect to any portion of the Improvements to maintain such in
its present condition, normal wear and tear and casualty damage excepted, shall
be caused to be made by the Contributors.
14.2. Operation of Improvements. The Improvements shall be operated
-------------------------
and managed in their present manner.
14.3. Compliance with Existing Agreements. The Contributors shall
-----------------------------------
cause the Project Entities to make diligent good faith efforts to comply with
the material terms, conditions, and provisions of the Leases, the Service
Contracts and the Existing Loan Documents and all payments payable thereunder by
the Project Entities shall be made when due.
24
<PAGE>
14.4. New Agreements. The Contributors shall not, without the
--------------
Partnership's prior written consent, permit the Project Entities (i) to enter
into any new Lease for all or any portion of the Improvements, or any lease
commission agreement related to any such new Lease, or (ii) to renew, modify,
cancel or accept surrender under any of the existing Leases or any lease
commission agreement related thereto (except pursuant to any right of renewal,
cancellation or surrender that any Tenant has the right to exercise under the
terms of its Lease). The Contributors shall not, without the Partnership's
prior written consent, not to be unreasonably withheld, permit the Project
Entities (a) to enter into any Service Contract which would be binding on the
Partnership or the Completed Properties after Closing if such Service Contract
cannot be terminated on thirty (30) days (or less) notice without charge, cost,
penalty or premium to the Partnership, or (b) to renew, modify or cancel any of
the Service Contracts (other than accepting the exercise by any contracting
party of any right it has under such Service Contract to renew or cancel such
Service Contract).
14.5. Notices. Promptly after receipt by any Project Entity, the
-------
Contributors shall cause that Project Entity to deliver to the Partnership a
copy of any notice of default given or received under any of the Leases or
Service Contracts or the Existing Loan Documents.
15. FIRE AND CASUALTY. The Contributors shall cause the Project Entities
-----------------
to maintain in effect until the Closing Date all insurance policies currently in
force with respect to the Completed Properties including liability insurance and
fire and extended coverage insurance. If at any time prior to the Closing Date
any portion of any of the Completed Properties is destroyed or damaged as a
result of fire or any other casualty (a "Casualty"), the Contributors shall
--------
promptly give written notice (a "Casualty Notice") thereof to the Partnership.
---------------
If a Completed Property is the subject of a Casualty, the Partnership shall have
the right, at its sole option, of terminating this Agreement (by written notice
to the Contributors given within thirty (30) days after receipt of the Casualty
Notice from the Contributors) as to that Completed Property unless:
(A) (i) all such damage or destruction is repaired at the sole
cost and expense of the Contributors prior to Closing to substantially the
condition existing immediately prior to such damage or destruction, or (ii)
the cost to fully repair or restore such damage is less than Two Hundred
Fifty Thousand Dollars ($250,000) and either (x) insurance proceeds
sufficient to restore fully such damage are available and the insurance
company issuing the Contributors' insurance policies has confirmed in
writing prior to the expiration of such thirty (30) day period that such
Casualty is covered by such policies and that no defense to payment of the
claim on account thereof exists, or (y) the Contribution Value of that
Completed Property is reduced by an amount equal to the deficiency in any
insurance proceeds described in clause (x); and
(B) such Casualty (i) does not result in any Tenant terminating its
Lease or asserting a right to terminate its Lease, and (ii) would not
entitle any Tenant to terminate its Lease after Closing if such Tenant has
not waived such right as of Closing.
25
<PAGE>
If a Casualty Notice is given to the Partnership less than thirty (30) days
prior to Closing, at the Partnership's option Closing shall be postponed to a
date not earlier than thirty (30) days after the Partnership's receipt of the
Casualty Notice. If the Partnership terminates this Agreement pursuant to this
Section as to a Completed Property, then this Agreement shall terminate and the
parties hereto shall have no further rights or obligations hereunder as to that
Completed Property, except for those obligations which by their express
provisions are to survive termination. If the Partnership does not terminate
this Agreement as to that Completed Property, the proceeds of any insurance with
respect to that Completed Property paid between the date of this Agreement and
the Closing Date, shall be paid to the Partnership at the time of Closing and
all unpaid claims and rights in connection with property damage to that
Completed Property shall be assigned to the Partnership at Closing.
16. EMINENT DOMAIN. In the event of a taking by condemnation or eminent
--------------
domain proceedings of any material portion of any of the Completed Properties
prior to the Closing Date, the Contributors shall promptly give written notice
thereof to the Partnership and the Partnership shall have the right, at its sole
option, of terminating this Agreement as to that Completed Property by written
notice given to the Contributors on or before the earlier to occur of the
Closing Date or the tenth (10th) day following receipt of such notice. If the
Partnership so terminates this Agreement as to that Completed Property, then
this Agreement shall terminate and the parties hereto shall have no further
rights or obligations hereunder as to that Completed Property, except for those
obligations which by their express provisions to survive termination. If the
Partnership does not terminate the Agreement pursuant to this Article 16, then
the Contributors shall pay over to the Partnership on the Closing Date all
monies received or collected by the Contributors by reason of such taking, and
the Contributors shall further assign and transfer to the Partnership all of the
Contributors' right, title and interest of, in and to any awards that have been
or may be made for such condemnation or eminent domain proceedings and the
additional money that may be payable when the same is and becomes assignable as
a matter of law.
17. DEFAULT.
-------
17.1. The Contributors' Default. If the contribution of the
-------------------------
Completed Properties contemplated by this Agreement is not consummated on
account of the Contributors' default hereunder, then the Partnership shall have,
in addition to any other right or remedy expressly provided hereunder, the right
to proceed against the Contributors at law for damages or to seek specific
performance of the Contributors' obligations under this Agreement.
17.2. The Partnership's Default. If the contribution of the
-------------------------
Completed Properties contemplated by this Agreement is not consummated because
of the Partnership's default, then the Contributors shall have, in addition to
any other right or remedy expressly provided hereunder, the right to proceed
against the Partnership at law for damages or to seek specific performances of
the Partnership's obligations under this Agreement.
26
<PAGE>
17.3 Pledge of Units. After Closing, the liability of the
---------------
Contributors Agreement shall be governed by the Partnership Amendment and the
pledge of Units and Shares of therein contained.
18. BROKERAGE AND OTHER FEES.
------------------------
18.1. Representations Regarding Brokers. Except for the broker
---------------------------------
identified in Subsection 18.2 hereof, the Contributors and the Partnership each
represent and warrant to the other that they have not employed, retained, or
consulted any broker, agent, or finder in connection with this Agreement or the
Transaction, and the Contributors and the Partnership each hereby indemnify and
agree to hold the other harmless from and against any and all claims, demands,
causes of action, debts, liabilities, judgments and damages (including costs and
reasonable attorneys' fees incurred in connection with the enforcement of this
indemnity) which may be asserted or recovered against the indemnified party for
or on account of any brokerage fee, commission, or other compensation arising by
reason of the indemnitor's breach of this representation and warranty. The
Contributors' indemnity of the Partnership pursuant to this Section 18.1
encompasses any claims made by the broker identified in Section 18.2.
18.2. Brokers' Commission and Representation. The Contributors and
--------------------------------------
the Partnership acknowledge that First Union Capital Markets Group (the
"Broker") has been retained as a broker by the Contributors and represent the
Contributors in connection with the Transaction, and the Contributors hereby
agrees that the Contributors shall pay to the Broker a commission in an amount
agreed upon by the Broker and the Contributors pursuant to a separate written
agreement.
18.3. Survival. This Article 18 shall survive the Closing or any
--------
termination, cancellation, or rescission of this Agreement.
19. MISCELLANEOUS.
-------------
19.1. Authorized Representative of Contributors. The Contributors hereby
-----------------------------------------
appoint H.S. Lichtin as their authorized representative under this Agreement.
Any direction, consent, approval, disapproval, authorization or other action
required or permitted to be given or taken under this Agreement by any of the
Contributors shall be given or taken only by H.S. Lichtin. In giving notice to
the Contributors under this Agreement, the Partnership may give such notice only
to H.S. Lichtin as provided under Section 19.6 and such notice shall constitute
notice to all of the Contributors. If the Partnership receives notice of any
matter from any Contributor who is not H.S. Lichtin, the Partnership shall be
entitled at its discretion to disregard such notice and such notice shall have
no legal effect under this Agreement, unless and until confirmed by H.S.
Lichtin. The written statements and representations of H.S. Lichtin shall for
the purposes of this Agreement be binding upon the Contributors and the
Partnership shall have no obligation or duty whatsoever to inquire into the
authority to take any action which he proposes to take, regardless of whether
H.S. Lichtin actually has the authority to take any such action; and the
Partnership shall be entitled to rely upon any direction, authorization,
consent, approval or disapproval given by H.S. Lichtin in connection with any
matter arising out of or in connection with this Agreement.
27
<PAGE>
19.2. Successors and Assigns. The Partnership shall not assign, sell,
----------------------
convey or otherwise transfer any or all its rights under this Agreement without
the prior written consent of the Contributors. The Contributors shall not
assign, sell, convey, or otherwise transfer any or all of the Completed
Properties or its rights under this Agreement. No such assignment by the
Contributors or the Partnership shall relieve or release the assigning party of
any liability hereunder. Subject to the foregoing, this Agreement and the terms
and provisions hereof shall inure to the benefit of and be binding upon the
successors and assigns of the parties.
19.3. Waiver, Consent. This Agreement and the other Transaction Documents
---------------
supersede all prior agreements between the parties hereto with respect thereto.
No claim of waiver, modification, consent or acquiescence with respect to any of
the provisions of this Agreement shall be made against either party, except on
the basis of a written instrument executed by or on behalf of such parties.
19.4. Governing Law. This Agreement shall be governed by and construed in
-------------
accordance with the laws of the State of North Carolina.
19.5. Headings; Exhibits. The headings of the several articles, sections,
------------------
and subsections of this Agreement are inserted solely for the convenience of
reference and are not a part of and are not intended to govern, limit, or aid in
the construction of any term or provision hereof. All exhibits referenced herein
are, by that reference, deemed to be fully incorporated into this Agreement.
19.6 Number and Gender of Words. Words of any gender used in this
--------------------------
Agreement shall be held and construed to include any other gender, and words of
a singular number shall be held to include the plural and vice versa, unless the
context requires otherwise.
19.7 Notices. Any notice, request or other communication (a "notice")
------- ------
required or permitted to be given hereunder shall be in writing and shall be
delivered by hand or overnight courier (such as UPS) or by facsimile
transmission or mailed by United States registered or certified mail, return
receipt requested, postage prepaid and addressed to each party at its address as
set forth below. Any such notice shall be considered given on the date of such
hand or courier delivery, deposit with such overnight courier for next business
day delivery, or upon transmission by facsimile with confirmation or deposit in
the United States mail, but the time period (if any is provided herein) in which
to respond to such notice shall commence on the date of hand or courier delivery
or upon transmission by facsimile with confirmation or on the date received
following deposit in the United States mail as provided above. Rejection or
other refusal to accept or inability to deliver because of changed address of
which no notice was given shall be deemed to be receipt of the notice. By
giving at least five (5) days' prior written notice thereof, any party may from
time to time and at any time change its mailing address hereunder. Any notice
of any party may be given by such party's counsel. The parties respective
notice addresses are as follows:
28
<PAGE>
Partnership: Weeks Realty, L.P.
4497 Park Drive
Norcross, Georgia 30093
Attention: Thomas D. Senkbeil,
Vice Chairman and Chief
Financial Officer
FAX: (770) 717-3310
With Copy To: King & Spalding
191 Peachtree Street
Atlanta, Georgia 30303-1763
Attention: William J. Armstrong, Esq.
FAX: (404) 572-5148
Contributors: Harold S. Lichtin
Suite 200
1800 Perimeter Park Drive
Morrisville, North Carolina 27560
FAX: (919) 467-4428
With Copy To: Kennedy Covington Lobdell & Hickman, L.L.P.
Two Hanover Square
Suite 1900
434 Fayetteville Street Mall
Raleigh, North Carolina 27602
Attention: Alan H. Peterson, Esq.
FAX: (919) 743-7358
19.8. Severability. If any provision of this Agreement or the application
------------
thereto to any person or circumstance shall be invalid or unenforceable to any
extent, the remainder of this Agreement and the application of such provisions
to the other persons or circumstances shall not be affected thereby and shall
enforced to the greatest extent permitted by law.
19.9. Other Parties. Nothing in this Agreement shall be construed as
-------------
giving any person, firm, corporation, or other entity, other than the parties
hereto, their successors and assigns, any rights, remedy or claim under or in
respect to this Agreement or any provision hereof.
19.10. Counterparts. This Agreement may be executed in any number of
------------
counterparts, each of which so executed shall be deemed an original; such
counterparts together shall constitute the one agreement.
19.11. Time Is Of The Essence. Time is of the essence of this Agreement;
----------------------
provided, however, that if the time within which any action, consent, approval,
- -------- -------
29
<PAGE>
or other activity herein contemplated, expires on a Saturday, Sunday, or legal
holiday, such time period shall automatically be deemed extended to the first
day after the scheduled termination of such time period which is not a Saturday,
Sunday, or legal holiday.
19.12. Delay Not A Waiver. No failure or delay by a party to exercise any
------------------
right it may have by reason of the default of the other party shall operate as a
waiver of default or modification of this Agreement or shall prevent the
exercise of any right by the first party while the other party continues to be
so in default.
19.13. Survival. All representations, warranties and agreements of the
--------
Contributors and the Partnership contained in this Agreement shall survive the
Closing.
19.14. Confidentiality. The Partnership and the Contributors agree that
---------------
all documents and information concerning the Completed Properties delivered to
the Partnership, the subject matter of this Agreement, and all negotiations will
remain confidential. The Partnership and the Contributors will disclose such
information only to those parties required to know it, including, without
limitation, employees of either of the parties, consultants and attorneys
engaged by either of the parties, prospective or existing investors, lenders and
governmental authorities; provided, however, that no party hereto shall have any
-------- -------
liability to the other for disclosing such confidential information which has
been made public through sources other than a violation of this covenant.
19.15. Attorney Fees. In the event a breach of this Agreement by either
-------------
party, the non-breaching party shall be entitled to recover all costs associated
with enforcing this Agreement, including reasonable attorneys' fees and
expenses.
19.16. Delayed Closings. Notwithstanding the provisions of Section 8.1
----------------
that all of the Completed Properties are to be contributed to the Partnership on
even date with this Agreement, the Contributors and the Partnership agree that
1000 Perimeter Park Completed Property, the RTIC (I-IV) Completed Property and
1100 Perimeter Park West Completed Property shall be delayed, in the case of
1000 Perimeter Park Completed Property and RTIC (I-IV) Completed Property to a
Closing Date on or before January 31, 1997 and in the case of 1100 Perimeter
Park West Limited Partnership to August 1, 1997. On even date herewith, the
Project Entities that own these two Completed Properties shall enter into an
exclusive development, leasing and management agreement with the Partnership for
the provision of such services until contribution to the Partnership. In the
case of the RTIC (I-IV) Completed Property, prior to contribution, the
Contributors, at their sole cost and expense, agree to cash-out the interest of
the non-accredited partners.
19.17. Claimed Default. Optimum Technologies, a tenant in the 1800
---------------
Perimeter Park West Development Property has asserted a claim for reimbursement
of expenses due to delay in delivery of their space by the Project Partnership.
If the partnership, after reviewing the matter, determines in the exercise of
commercially reasonable judgement that this tenant is due reimbursement, the
contributors agree to reimburse the partnership for funds paid by the
30
<PAGE>
partnership to this tenant in settlement of such claim. The Partnership agrees
that prior to reaching a settlement with Tenant it shall review the settlement
with the Contributor and consider in good faith their position in the matter;
provided, however, often such due consideration the Partnership shall have full
authority to settle the claim. This agreement to reimburse is not subject to
any limitation on the liability of the Contributors contained in the Partnership
Amendment.
19.18. Land Representations and Warranties. As of the date of this
-----------------------------------
Agreement, the Contributors hereby make, jointly and severally, for the benefit
of the Partnership, each and every representation and warranty set forth in
Section 11 of this Agreement, to the extent applicable to unimproved land, as to
the approximately 8 acres of land in Woodlake, the approximately 21.18 acres of
land in Perimeter Park West, the approximately 5.6 acres of land in Perimeter
Park, the so-called "Watkins Land" and the so-called "Maintenance and Storage
Tract" (all as more particularly described in the special warranty deed from
Initial CP Limited Partnership and Woodlake II LLC to the Partnership dated of
even date herewith). Weeks acknowledges and agrees that the liability of the
Contributors for breach of these representations and warranties are subject in
all respects to the limitations on liability set forth in the Partnership
Amendment and the pledge of Units and shares therein contained.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
under seal on the dates set forth below.
CONTRIBUTORS:
------------
(SEAL)
------------------------------------------
Harold S. Lichtin
(SEAL)
------------------------------------------
Roland Gregory Robertson, not
individually, but as attorney-in-fact for Marie
Antoinette Robertson pursuant to power of attorney
dated as of October 31, 1996
(SEAL)
------------------------------------------
Noel A. Lichtin
(SEAL)
------------------------------------------
Amy L. Robertson
(SEAL)
------------------------------------------
Roland Gregory Robertson
31
<PAGE>
(SEAL)
------------------------------------------
Noel A. Lichtin, not individually but as
Trustee of the Adam Lee Lichtin Trust
(SEAL)
------------------------------------------
Noel A. Lichtin, not individually but as
Trustee of Karen Stacy Lichtin Trust
(SEAL)
------------------------------------------
Noel A. Lichtin, not individually but as
Trustee of the Steven Aaron Lichtin Trust
PERIMETER PARK WEST
ASSOCIATES LIMITED PARTNERSHIP,
a North Carolina limited partnership
By: (SEAL)
---------------------------------------
Harold S. Lichtin
General Partner
By: (SEAL)
---------------------------------------
Roland Gregory Robertson, not individually,
but as attorney-in-fact for Marie
Antoinette Robertson, General Partner,
pursuant to power of attorney dated
as of October 31, 1996
INTERCHANGE ASSOCIATES LIMITED
PARTNERSHIP, a North Carolina limited partnership
By: (SEAL)
---------------------------------------
Harold S. Lichtin
General Partner
32
<PAGE>
By: (SEAL)
--------------------------------------------
Roland Gregory Robertson, not
individually, but as attorney-in-fact for Marie
Antoinette Robertson, General Partner, pursuant
to power of attorney dated as of October 31,
1996
PARTNERSHIP:
-----------
WEEKS REALTY, L.P., a Georgia limited partnership
authorized to do business in the State of North
Carolina as Weeks Realty Limited Partnership
By: Weeks GP Holdings, Inc., a Georgia corporation,
sole general partner
By:
------------------------------------------
Title:
---------------------------------------
[CORPORATE SEAL]
33
<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
CONTRIBUTION AGREEMENT
FOR
DEVELOPMENT PROPERTIES
AND
REGENCY FOREST LAND
AMONG
"CONTRIBUTORS"
(AS HEREIN DEFINED)
AND
WEEKS REALTY, L.P.
DOING BUSINESS AS
WEEKS REALTY LIMITED PARTNERSHIP
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
-----------------
<TABLE>
<CAPTION>
Page
----
<C> <S> <C>
1. DEFINED TERMS...................................................... 2
2. COVENANT TO CONTRIBUTE............................................. 10
3. STRUCTURE OF CONTRIBUTION.......................................... 10
4. CONTRIBUTION DATE.................................................. 10
5. CONTRIBUTION VALUE................................................. 11
6. ADJUSTED CONTRIBUTION VALUE........................................ 11
7. ISSUANCE OF UNITS.................................................. 12
8. INTERIM CONDUCT.................................................... 12
9. EXISTING LOANS..................................................... 14
10. TITLE AND SURVEY................................................... 15
11. DATE, TIME AND PLACE OF CONTRIBUTION............................... 16
12. COSTS AND EXPENSES; PREPARATION OF DOCUMENTS....................... 18
13. ACCESS TO AND EXAMINATION OF THE
DEVELOPMENT PROPERTIES............................................. 18
14. REPRESENTATIONS AND WARRANTIES OF
THE CONTRIBUTORS................................................... 19
15. REPRESENTATIONS AND WARRANTIES OF WEEKS............................ 27
16. CONDITIONS......................................................... 28
17. FIRE AND CASUALTY.................................................. 30
18. EMINENT DOMAIN..................................................... 31
19. DEFAULT............................................................ 32
</TABLE>
i
<PAGE>
<TABLE>
<CAPTION>
Page
----
<C> <S> <C>
20. BROKERAGE FEES..................................................... 32
21. MISCELLANEOUS...................................................... 33
</TABLE>
ii
<PAGE>
SCHEDULE OF EXHIBITS
EXHIBIT A Development Properties
EXHIBIT B Existing Loans
EXHIBIT C Existing Loan Documents
EXHIBIT D Legal Descriptions of Land
EXHIBIT E Leasing Guidelines
EXHIBIT F Permitted Exceptions
EXHIBIT G Pro Forma Annual Operating Expenses/Pro Forma Reimbursable
Amounts/Pro Forma Cost
EXHIBIT H Rent Roll
EXHIBIT I Tenant Estoppel Certificate Form
EXHIBIT J Schedule of Environmental Reports
EXHIBIT K Schedule of Pending or Threatened Litigation
EXHIBIT L Schedule of Engineering Reports
EXHIBIT M Schedule of Insurance Coverage
EXHIBIT N Schedule of Incomplete Improvements
EXHIBIT O Schedule of Service Contracts
EXHIBIT P Schedule of Commission Obligations
EXHIBIT Q Regency Forest Land Site Plan
iii
<PAGE>
CONTRIBUTION AGREEMENT
(Development Properties)
(Regency Forest Land)
THIS CONTRIBUTION AGREEMENT (hereinafter referred to as this "Agreement"),
made and entered into as of this 31st day of December, 1996, by and among the
"CONTRIBUTORS" (as hereinafter defined); and WEEKS REALTY, L.P., a Georgia
limited partnership authorized to do business in North Carolina as Weeks Realty
Limited Partnership (hereinafter referred to as "Weeks");
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, pursuant to the "Transaction Documents" (as defined in that
certain Contribution Agreement for Completed Properties, dated of even date
herewith), the Contributors and other contributors identified in the Transaction
Documents have agreed to contribute in stages certain assets, properties and
businesses to the capital of Weeks upon and subject to the terms and conditions
set forth in the Transaction Documents (hereinafter referred to as the
"Transaction");
WHEREAS, on even date herewith, the Contributors and other contributors
identified in the Transaction Documents contributed to the capital of Weeks
(hereinafter referred to as the "Initial Contribution") the "Completed
Properties" (as defined in that certain Contribution Agreement for Completed
Properties, dated as of even date herewith) in exchange for "Units" (as
hereinafter defined) and assumption (subject to the limitation on recourse
provisions) of certain indebtedness as one of the stages in the Transaction;
WHEREAS, as another stage of the Transaction, Contributors have agreed to
contribute, from time to time, each of the "Development Properties" (as
hereinafter defined) and the "Regency Forest Land" (as hereinafter defined) to
the capital of Weeks in exchange for the issuance of additional Units and the
assumption (subject to the limitation on recourse provisions) of certain
indebtedness, as and when certain conditions are met, all as more particularly
set forth in this Agreement; and
WHEREAS, Weeks has agreed to accept such contribution of the Development
Properties and, in connection therewith, issue Units to the Contributors and
assume (subject to the limitations of recourse provisions) certain liabilities,
all as more particularly set forth in this Agreement.
NOW, THEREFORE, for and in consideration of the foregoing premises, the
mutual covenants and agreements herein set forth and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Contributors and Weeks hereby covenant and agree as follows:
<PAGE>
1. DEFINED TERMS. In addition to terms defined elsewhere in this
Agreement, the following words, when used in this Agreement, shall have
the meanings ascribed thereto in this paragraph:
a. "Adjusted Contribution Value" means the adjusted contribution value
---------------------------
for a Development Property arrived at after making the adjustments
provided for in Paragraph 6 of this Agreement.
b. "Contribution" means the consummation of a contribution to the
------------
capital of Weeks of a Development Property pursuant to the terms and
conditions of this Agreement; and "Contribute" means the making of a
----------
Contribution.
c. "Contribution Date", for each Development Property, means the date on
-----------------
which that Development Property is Contributed by the Contributors to
the capital of Weeks pursuant to Paragraph 4 of this Agreement.
d. "Contribution Value" means the contribution value of a Development
------------------
Property determined in accordance with Paragraph 5 of this Agreement.
e. "Contributors" means, collectively, H.S. Lichtin, M.A. Robertson,
------------
Noel Lichtin, and PPW; and "Contributor" means any one of the
-----------
Contributors.
f. "Development Property" means the Real Property, the Tangible Personal
--------------------
Property and the Intangible Personal Property located at, attributable
to or used in connection with one of the four (4) projects identified
on Exhibit A, attached hereto and by this reference made a part hereof;
---------
and Development Properties means, collectively, all of the Real
----------------------
Property, the Tangible Personal Property and the Intangible Personal
Property located at, attributable to or used in connection with all of
the four (4) projects identified on Exhibit A hereto. Any reference to
---------
a specific Development Property shall be made by incorporating the name
of the project as set forth on Exhibit A; for example, a specific
---------
reference to the first listed Development Property shall be the
"Woodlake III Property". Development Property does not include the
Regency Forest Land.
g. "Environmental Laws" means the Resource Conservation and Recovery Act
------------------
(42 U.S.C. (S) 6901 et seq.), as amended by the Hazardous Materials
-- ---
Transportation Act (490 U.S.C. (S) 1801 et seq.); the Toxic Substance
-- ---
Control Act (15 U.S.C. (S) 2601 et seq.); Clean Air Act U.S.C. (S) 136
-- ---
et seq.); the Occupational Safety and Health Act (29 U.S.C. (S) 651 et
-- --- --
seq.) and all applicable federal, state and local environmental laws,
---
including obligations under the common law, ordinances, rules and
-2-
<PAGE>
regulations, as any of the foregoing may have been amended,
supplemented or supplanted prior to the date hereof, relating to
regulation or control of Hazardous Materials, or their handling,
storage or disposal or to environmental health and safety.
h. "Existing Loan" means one of the loans identified on Exhibit B, attached
------------- ---------
hereto and by this reference made a part hereof; and "Existing Loans"
--------------
means, collectively, all of the loans identified on Exhibit B hereto.
---------
i. "Existing Loan Documents" means, collectively, all of the loan documents
-----------------------
evidencing and securing an Existing Loan, as identified on Exhibit C,
---------
attached hereto and by this reference made a part hereof.
j. "Gross Income", for the purpose of determining the Contribution Value of
------------
a Development Property and subject to certain adjustments and
deductions expressly provided in this definition, means the sum of the
gross rental income, including applicable Pro Forma Reimbursable
Amounts, scheduled to be paid by each Tenant under its Lease for the
twelve (12) month period commencing on the Contribution Date, subject
to the following:
i. If Tenant free rent concessions for a Lease exceed (A) three (3)
months for a Lease that has an original term of at least five (5)
years, or (B) one (1) month for a Lease that has an original term of
less than five (5) years (in either case, such excess, the "Excess
Tenant Concessions"); then, the amount included in determining Gross
Income from this Lease shall equal the dollar amount derived from
the following formula:
(A) [(B - C)/B] = D
where in the foregoing formula:
A = gross rental income, including applicable
Pro Forma Reimbursable Amounts, scheduled to be paid
under the Lease for the twelve (12) month period
commencing on the Contribution Date;
B = total gross rental income, including applicable Pro
Forma Reimbursable Amounts, scheduled to be paid under
the Lease for the original term of the Lease,
calculated without regard to Excess Tenant Concessions;
-3-
<PAGE>
C = total value of the Excess Tenant Concessions for the
initial term of the Lease; and
D = amount to be included in Gross Income from the Lease.
ii. If the allowance for tenant finish exceeds the applicable Pro Forma
Level of Tenant Allowance in a Lease in a Development Property, for
the purpose of determining Gross Income from that Development
Property, the rental income attributable to the twelve (12) month
period commencing on the Contribution Date shall be reduced by the
amount attributable to that twelve (12) month period for
amortization of such excess tenant allowance and lease commissions
attributable to that excess tenant allowance. For this purpose, the
amortization shall be computed by treating the amount of the excess
tenant allowance and related commission cost as a loan to Tenant
having a term equal to the original term of the Lease and bearing
interest at a simple interest rate per annum of ten and one-quarter
percent (10.25%) to be repaid in equal monthly installments of
principal and interest over the original term of the Lease.
k. "Hazardous Materials" means (i) those substances included within
-------------------
definitions of or identified as "hazardous substances," "hazardous
materials," or "toxic substances" in or pursuant to Environmental Laws;
(ii) those substances listed in the United States Department of
Transportation Table (40 CFR 172.101 and amendments thereto) or by the
Environmental Protection Agency (or any successor agency) as hazardous
substances (40 CFR Part 302 and amendments thereto); (iii) any material,
waste or substance which is or contains (A) petroleum, including crude
oil or any fraction thereof, natural gas or synthetic gas usable for
fuel or any mixture thereof, or any product containing the foregoing
substances, (B) asbestos or asbestos containing material, (C)
polychlorinated biphenyls, (D) any substance designated as "hazardous
substance" pursuant to Section 311 of the Clean Water Act, 33 U.S.C. (S)
1251 et seq. (33 U.S.C. (S) 1321), or listed pursuant to Section 307 of
-- ---
the Clean Water Act (33 U.S.C. (S) 1317); (E) flammable explosives; (F)
radioactive materials; and (iv) such other substances, materials and
wastes which are or become regulated as hazardous, toxic or "special
wastes" under Environmental Laws.
l. "H.S. Lichtin" means Harold S. Lichtin, an individual resident of North
------------
Carolina.
m. "Improvements" means all buildings, structures and other improvements,
------------
including such fixtures as constitute real property, located on the
Land.
-4-
<PAGE>
n. "Intangible Personal Property" means any intangible personal property
----------------------------
now or hereafter owned by Project Entity in connection with the Land,
the Improvements or the Tangible Personal Property, and all of Project
Entity's rights under all contracts, utility arrangements, and other
agreements relating to the ownership, operation and occupancy thereof,
including, without limitation, warranties from contractors on the
Improvements, roof warranties, equipment warranties, the Leases and
Service Contracts; provided, however, the term "Intangible Personal
-------- -------
Property" does not include any cash on hand and in bank accounts, notes
receivable, accounts receivable (except as provided in Paragraph 11),
rights under pending litigation, any rights to the name "Lichtin
Properties, Inc.", and any prepaid insurance premiums.
o. "Land" means those certain tracts or parcels of real property located
----
in Wake County, North Carolina, and containing approximately 25.0 acres,
in the aggregate, as more particularly described in Exhibit D, attached
---------
hereto and by this reference made a part hereof, together with all of
Project Entity's right, title and interest in and to all appurtenances,
rights, easements, tenements and hereditaments incident thereto. Land
does not include the Regency Forest Land.
p. "Lease" means any lease or occupancy agreement affecting the Development
-----
Properties.
q. "Leasing Guidelines" means the leasing guidelines set forth on
------------------
Exhibit E, attached hereto and by this reference made a part hereof.
r. "Lender" means the holder of an Existing Loan.
------
s. "Liens" means any liens, security interests, mortgages, deeds of trust,
-----
charges, claims, encumbrances, pledges, options, rights of first offer
or first refusal and any other rights or interests of others of any kind
or nature, actual or contingent, or other similar encumbrances of any
nature whatsoever.
t. "M.A. Robertson" means Marie Antoinette Robertson, an individual
--------------
resident of Texas.
u. "Net Operating Income", for the purposes of determining the
--------------------
Contribution Value of a Development Property as of its Contribution
Date, means (i) Vacancy Adjusted Gross Income; less (ii) Operating
Expenses.
v. "Noel Lichtin" means Noel Lichtin, an individual resident of North
------------
Carolina.
-5-
<PAGE>
w. "Operating Expenses", for the purposes of determining the Contribution
------------------
Value of a Development Property, means the applicable Pro Forma Annual
Operating Expense for the twelve (12) month period commencing on the
Contribution Date for that Development Property. Operating Expenses also
shall include, without limitation, (i) a management fee equal to four
percent (4%) (or such other percentage as is contractually agreed in a
Lease for the gross rental income from that Lease) of Vacancy Adjusted
Gross Income (but not including reimbursables) for the twelve (12) month
period commencing on the Contribution Date for that Development
Property, and (ii) a reserve for expenses in the amount of eight cents
($.08) per square foot of area in the Enterprise III Development
Property, five cents ($.05) per annum per square foot of area in the
Woodlake III Development Property and ten cents ($.10) per annum per
square foot of area in the Regency-Sprint Development Property and the
2000 Perimeter Park West Development Property.
x. "Partnership Amendment" means that certain Second Amendment to Second
---------------------
Amended and Restated Agreement of Limited Partnership, dated of even
date herewith, pursuant to which H.S. Lichtin and M.A. Robertson, among
others, are admitted as limited partners to Weeks.
y. "Permitted Exceptions" means those matters set forth in Exhibit F,
--------------------
attached hereto and by this reference made a part hereof, the Existing
Loan Documents, together with any matter expressly approved by Weeks
pursuant to this Agreement.
z. "PPW" means Perimeter Park West Associates Limited Partnership, a North
---
Carolina limited partnership having H.S. Lichtin and M.A. Robertson as
its General Partners.
aa. "Pro Forma Annual Operating Expense" means the pro forma annual
----------------------------------
operating expense set forth on Exhibit G, attached hereto and by this
---------
reference made a part hereof.
bb. "Pro Forma Cost" means the pro forma cost for each Development
--------------
Property also set forth on said Exhibit G hereto.
cc. "Pro Forma Level of Tenant Allowance" means the following applicable
-----------------------------------
level of tenant finish allowance per square foot of area in the
following Development Properties:
-6-
<PAGE>
Development Property Allowance
-------------------- ---------
Woodlake III $ 7.00
Regency - Sprint $20.00 (below hung ceiling)
2000 Perimeter Park West $20.00 (below hung ceiling)
Enterprise III $20.00 (below hung ceiling)
dd. "Pro Forma Reimbursable Amounts" means the pro forma reimbursable
------------------------------
amounts also set forth on said Exhibit G hereto.
---------
ee. "Project Entity" means Regency Forest, LLC, a North Carolina limited
--------------
liability company, having H.S. Lichtin, M.A. Robertson and PPW as its
sole Members, which is the Project Entity as to the Regency-Sprint
Development Property and the Regency Forest Land, and FutureP Limited
Partnership, a North Carolina limited partnership, having H.S. Lichtin
and M.A. Robertson as its General Partners, and PPW as its sole limited
partner, which together with any new limited partnership formed pursuant
to Paragraph 3 of this Agreement, as to the Development Property it will
own at the time that Development Property is contributed to Weeks, is
the Project Entity for the Woodlake III Development Property, the 2000
Perimeter Park West Development Property, and the Enterprise III
Development Property.
ff. "Real Property" means collectively, the Land and the Improvements.
-------------
gg. "Regency Forest Land" means the 22.0 acres of undeveloped land located
-------------------
in Wake County, North Carolina, as generally depicted on the site plan
attached hereto as Exhibit Q hereto. Regency Forest Land does not
---------
include the Land.
hh. "Rent Roll" means any and all Leases containing, with respect to each
---------
Lease, information as to the commencement date of such Lease, the
termination date of such Lease, any renewal rights or expansion rights
under such Lease, the approximate square footage of the leased premises
under such Lease, the annual base rental and additional rent due under
such Lease, and the amount and duration of any rent or other concessions
made to the Tenant under such Lease. The Rent Roll attached hereto as
Exhibit H and by this reference made a part hereof, sets forth the
---------
status of leasing at the Development Properties as of the date hereof.
ii. "Rights Agreements", collectively, means that certain Registration
-----------------
Rights and Lock-Up Agreement and that certain Registration Rights and
Lock-Up Agreement for Post-June 30, 1998 Shares and Units, both dated of
-7-
<PAGE>
even date herewith and both by and among Weeks and H.S. Lichtin, M.A.
Robertson and certain other contributors identified in the Transaction
Documents.
jj. "Service Contracts" means any and all of the service contracts,
equipment, labor or material contracts, management contracts,
maintenance or repair contracts, personal property leases or other
agreements (other than the Leases and related lease commission
agreements) entered into by Project Entity (or its predecessors) and
that are in force and effect and that affect the Development Properties
or the operation, repair, or maintenance thereof.
kk. "Security Deposits" means the refundable deposits (in the form of
-----------------
cash, letters of credit or certificates of deposit) made by Tenants with
Project Entity as security for such Tenants' obligations under their
respective Leases, to the extent not previously forfeited, applied or
refunded, together with interest thereon accrued as of the Contribution
Date which Project Entity is obligated to pay to any such Tenants.
ll. "Stabilization", with reference to a specific Development Property,
means that all of the following conditions have been met: (i) ninety-
five percent (95%) of the net leasable area of the Improvements have
been leased to creditworthy Tenant(s) approved by Weeks under Lease(s)
approved by Weeks (which will base its approval on commercially
reasonable standards); (ii) Tenant(s) are in actual possession and have
accepted possession of ninety-five percent (95%) of the net leasable
area of the Improvements; (iii) except for free-rent periods expressly
stipulated in the Lease(s), rental shall have commenced on ninety-five
percent (95%) of the net leasable area of the Improvements and all other
concessions (besides any free rent periods) shall have expired; (iv) no
default by Project Entity or any Tenant is then outstanding and uncured
under the Lease(s), and (v) all of matters described in the foregoing
four (4) clauses have been confirmed to Weeks by the Tenant(s) pursuant
to Tenant Estoppel Certificate(s). For the purposes this definition, the
Contributors and Weeks agree that the net leasable area of the
Improvement in each Development Property is that set forth on Exhibit A
---------
hereto.
mm. "Tangible Personal Property" means all tangible personal property
--------------------------
located on the Real Property which is owned by Project Entity and used
in the ownership, operation and maintenance of the Land and
Improvements, including, without limitation, all art, furniture,
furnishings, fixtures and equipment and stock for completion of Tenant
improvements.
nn. "Tenant" means any Tenant or lessee under any of the Leases.
------
-8-
<PAGE>
oo. "Tenant Estoppel Certificate" means the certificate to be submitted for
---------------------------
execution to each Tenant with respect to the Lease pursuant to which
such Tenant leases space in the Improvements, such certificate to be in
the form attached hereto as Exhibit I and incorporated herein by this
---------
reference.
pp. "To Contributors' Knowledge" means to the current actual knowledge of
--------------------------
H.S. Lichtin, James C. Little, Robert G. Yelverton and Carol R. Wood.
qq. "Total Potential Gross Income", for the purpose of determining Vacancy
----------------------------
Adjusted Gross Income, means at the Contribution Date the sum of (i)
Gross Income, and (ii) the amount of Gross Income (including Pro Forma
Reimbursable Amounts) that would accrue from all vacant space in a
Development Property if such vacant space were leased at the rental
rates specified in the Leasing Guidelines, and assuming a term of less
than 10 years, with no adjustment for any excess tenant concessions or
excess office finish and related Lease commissions.
rr. "Units" means limited partnership units in Weeks Realty, L.P., as
-----
described in the Rights Agreements.
ss. "Unit Price" means the arithmetic average, rounded to the nearest
----------
one-eighth (1/8), of the daily closing price of a share of common stock
of Weeks Corporation on the New York Stock Exchange for the twenty (20)
trading days immediately prior the Contribution Date; provided, however,
if the Contribution Date is on or before July 1, 1997, and if such
average is less than Twenty-Five Dollars and Twenty-Five Cents ($25.25),
the Unit Price shall be Twenty-Five Dollars and Twenty-Five Cents
($25.25) and, if such average exceeds Twenty-Seven Dollars ($27.00), the
Unit Price shall be Twenty-Seven Dollars ($27.00). The Unit Price set
forth in the immediately preceding sentence is a negotiated amount for
the purposes of this Agreement and does not reflect a valuation by the
Contributors or Weeks of Weeks Corporation or Weeks.
tt. "Vacancy Adjusted Gross Income", to adjust for possible future vacancy,
-----------------------------
for each Development Property as of the Contribution Date, means the
following:
i. If on the Contribution Date, less than ninety-five percent (95%) of
the space in such Development Property is leased, then the Vacancy
Adjusted Gross Income shall equal the Gross Income.
ii. If on the Contribution Date, at least ninety-five percent (95%) of
the space in such Development Property is leased, then the Vacancy
Adjusted Gross Income shall be the lesser of:
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<PAGE>
(1) Gross Income of that Development Property; or
(2) ninety-five percent (95%) of Total Potential Gross Income of
that Development Property, plus an amount equal to five percent
(5.0%) of the Gross Income attributable to leases having a term
of ten years or more.
2. COVENANT TO CONTRIBUTE. The Contributors hereby covenant and agree to
----------------------
contribute the Development Properties to the capital of Weeks pursuant
to the structure outlined in Paragraph 3 of this Agreement and in
accordance with, and subject to, the terms and conditions of this
Agreement. Weeks hereby covenants and agrees to accept Contribution of
the Development Properties to its capital pursuant to the structure
outlined in Paragraph 3 of this Agreement and in accordance with, and
subject to, the terms and conditions of this Agreement.
3. STRUCTURE OF CONTRIBUTION. Each time a Development Property is to be
-------------------------
Contributed to the capital of Weeks by the Contributors pursuant to
this Agreement: (i) on the Contribution Date, immediately prior to the
Contribution, the Development Properties and Regency Forest Land that
are not then being Contributed to Weeks shall be transferred to a
newly-formed limited partnership having the same partners as FutureP
Limited Partnership; (ii) on the Contribution Date, each of the
Contributors shall contribute to the capital of Weeks all general
partnership interests limited partnership interests or membership
interests, as applicable, in Project Entity that still owns the
Development Property being Contributed, (iii) in exchange for the
Contribution of ownership interests in such Project Entity, as
described in the immediately preceding clause (ii), Weeks shall issue
Units to the Contributors as provided in Paragraph 7 and immediately
following such Contribution as described in clause (ii) above, on the
Contribution Date, Weeks, as the sole owner of all ownership interests
in that Project Entity, shall dissolve that Project Entity and all
assets of that Project Entity, including the Development Property,
shall be distributed in dissolution to, and become part of the capital
of, Weeks and the Existing Loans encumbering the Development Property
shall be assumed by Weeks subject to the non-recourse provisions
thereof. Notwithstanding the foregoing provisions of this Paragraph 3
to the contrary, the Contributors may elect to cause Contribution of a
Development Property or the Regency Forest Land to be made by general
warranty deed from the Project Entity to Weeks.
4. CONTRIBUTION DATE. The Contribution Date for each Development Property
-----------------
shall be established as follows:
a. Each Development Property shall be Contributed by the Contributors to
Weeks pursuant to this Agreement on the earlier of (i) June 30, 1998,
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<PAGE>
or the (ii) date on which that Development Property achieves
Stabilization, which date, in either case, shall be the Contribution
Date for that Development Property.
b. Notwithstanding the provisions of Paragraph 4a of this Agreement to the
contrary, the Contributors may elect to Contribute a Development
Property before it achieves Stabilization (provided all other
conditions in Paragraph 16 are satisfied, including shell completion
and the obtaining of Tenant Estoppel Certificates) if the Net Operating
Income of such Development Property exceeds ten and four-tenths percent
(10.4%) of the applicable Pro Forma Cost for that Development Property.
In this case, the Contribution Date for that Development Property (as
demonstrated to the reasonable satisfaction of Weeks), shall be a date
within thirty (30) days after such level of return is achieved
designated by the Contributors by notice to Weeks.
5. CONTRIBUTION VALUE. The Contribution Value of a Development Property
------------------
shall be determined as of its Contribution Date and shall equal the
greater of:
a. The Net Operating Income of that Development Property determined as of
its Contribution Date divided by decimal one zero four (.104).
b. The applicable Pro Forma Cost (reduced by those amounts not yet
expended for tenant finish, related lease commissions and other costs
attributable to space not yet leased).
6. ADJUSTED CONTRIBUTION VALUE. After determination of the Contribution
---------------------------
Value of a Development Property, such Contribution Value shall be
subject to the following further prorations, allocations and
adjustments, all as of the Contribution Date (the "Adjusted
Contribution Value"):
a. If no adjustment to Gross Income has been made for free rent
concessions pursuant to clause (i) of the definition of Gross Income,
the Contribution Value shall be reduced by the amount of free rent
concessions unexpired as of the Contribution Date; provided, however,
the Contributors may elect to make a cash payment to Weeks for the
amount of unexpired free rent concessions in lieu of such adjustment.
b. If adjustment to Gross Income has been made for excess tenant finish
allowance and related lease commission pursuant to clause (ii) of the
definition of Gross Income, the Contribution Value shall be increased
by the actual cost of such excess tenant finish allowance and related
lease commissions.
c. If the Development Property is to be contributed subject to an
Existing Loan in accordance with the terms and conditions of
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<PAGE>
Paragraph 9 of this Agreement, the Contribution Value shall be reduced
by the outstanding principal balance of that Existing Loan as of the
Contribution Date.
d. Any other adjustment to the Contribution Value for which express
provision is made in this Agreement.
7. ISSUANCE OF UNITS. At Contribution, Weeks shall issue Units to the
-----------------
Contributors as provided in this Paragraph 7:
a. Weeks shall issue to each of the Contributors, pro rata in accordance
with their respective ownership interests in the Project Entity, a
number of Units equal to the quotient of the Adjusted Contribution
Value divided by the Unit Price.
b. Units issued by Weeks to the Contributors pursuant to this Agreement
shall be held by the Contributors subject to the terms and conditions
of the Partnership Amendment and the applicable Rights Agreements.
c. Notwithstanding any provision of this Agreement to the contrary, no
fractional Units shall be issued to the Contributors pursuant to this
Agreement. If as a result of the application of the foregoing formulas,
a fractional Unit is due any Contributor, Weeks shall pay to that
Contributor, in cash on the same date as the fractional Unit would
otherwise be issued and in lieu of any such fractional Unit, an amount
equal to that fractional Unit times the applicable Unit Price, as
determined pursuant to this Agreement.
8. INTERIM CONDUCT.
---------------
a. The Contributors hereby covenant and agree with Weeks that, so long as
this Agreement remains in full force and effect, the Contributors will
not permit any Project Entity to sell, assign, rent, lease, convey
(absolutely or as security), grant a security interest in, or otherwise
encumber or dispose of, the Development Properties (or any interest or
estate therein) without the prior written consent of Weeks; provided,
however, a Project Entity may enter into Leases for space in the
Development Properties without the prior written consent of Weeks so
long as (i) the terms of the Lease equal or exceed the Leasing
Guidelines, (ii) the prospective Tenant is approved by Weeks, in the
exercise of commercially reasonable judgment (provided, however, if the
Tenant is an affiliate of the Contributors, Weeks may elect to withhold
its approval in its absolute and sole discretion), (iii) the Lease is
on a form previously approved by Weeks, and (iv) within ten (10)
business days after written request by Weeks, the Contributors shall
furnish a copy of any such Lease which has been executed since the last
such request from Weeks.
-12-
<PAGE>
b. The Contributors covenants and agrees that, so long as this Agreement
remains in full force and effect, the Contributors will not permit
Project Entity to amend or modify the Existing Loan Documents in any
way, will cause Project Entity to make all payments of money, and will
cause Project Entity to perform all obligations, required under the
Existing Loan Documents. The Contributors will take no affirmative
action and will not permit Project Entity to take any affirmative
action which shall cause the Contributors to be unable to contribute
good and marketable title to the Development Properties or which shall
cause any warranty or representation contained in this Agreement to be
incorrect or misleading in any material request at any time.
c. The Contributors and Weeks agree that a "Bulk Building", a
"Distribution Building", a "Flex Building" and an "Office Building" (as
that terms are defined in this subparagraph) do not compete with each
other for prospective Tenants. Until such time as the net leasable area
of a Development Property (which has not yet been contributed to Weeks)
is at least fifty percent (50%) leased, Weeks agrees to not commence
construction of a building in the same park as that Development
Property is located that would compete with that Development Property.
By way of illustration and not limitation, if a Development Property is
classified as a "Flex Building", then pursuant to the foregoing
restriction, Weeks could commence construction of a Bulk Building, a
Distribution Building or an Office Building, but could not commence
construction of a Flex Building until such time as the net leasable
area of that Development Property, classified as a Flex Building, is at
least fifty percent (50%) leased. A "Flex Building" means a building
with less than eighteen (18) feet of clear interior height with grade
level loading. A "Bulk Building" means a building with a minimum of
eighteen (18) feet of clear interior height with dock level loading in
which ten percent (10%) or less of the rentable area is devoted to
office use. A "Distribution Building" means a building with a minimum
of eighteen (18) feet of clear interior height with dock level loading
in which more than ten percent (10%) of the rentable area is devoted to
office space. An "Office Building" means a building with dropped
ceilings, finished walls and floors and heating, ventilating and air
conditioning which is used primarily for office purposes.
d. On even date herewith, the Contributors shall cause the Project Entity
to enter into an agreement with Weeks (i) for the provision of
construction and development services with respect to the completion of
shell construction and construction of Tenant improvements in each of
the Development Properties for which Weeks shall earn fees equal to
five percent (5%) of the total costs incurred after the date hereof,
payable monthly; and (ii) for the provision of property management and
leasing services for each of the Development Properties for a term
commencing on the date hereof and ending, with respect to each of the
Development Properties, on the date that Development Property is
contributed to Weeks for a management fee equal to four percent (4%)
-13-
<PAGE>
(or such other percentage as is contractually agreed in a Lease with
respect to the rental collected from that Lease) of the gross collected
rent (excluding reimbursables) for each of the Development Properties,
payable monthly, and customary leasing fees and commissions.
e. The Contributors hereby covenant and agree, at their sole cost and
expense, to construct the Improvements on the Land in a good and
workerlike fashion, in compliance with all applicable laws, ordinances
and regulations and substantially in accordance with plans and
specifications approved by Weeks, which approval not to be unreasonably
withheld or delay. The Contributors further agree and covenant to
prosecute such construction in a diligent manner so as to comply with
all terms and conditions of the Existing Loan Documents or any Lease
affecting the Development Properties.
9. EXISTING LOANS.
--------------
a. The Development Properties are subject to the Existing Loans and are
encumbered by the Existing Loan Documents. At the time the Contributors
notify Weeks that a Development Property is to be contributed to Weeks
pursuant to this Agreement, such notice shall state whether (i) the
Contributors, at their sole cost and expense, will pay-in-full the
Existing Loan that encumbers each Development Property to be
contributed and cause the Existing Loan Documents to be canceled
immediately prior to the Contribution, or (ii) the Contributors intend
to contribute the Development Property subject to the Existing Loan to
Weeks pursuant to this Agreement.
b. Weeks agrees to accept a Contribution of a Development Property
subject to the Existing Loan applicable thereto and assume the Existing
Loan (subject to its non-recourse provisions), provided each of the
following conditions is satisfied at the time of Contribution to the
reasonable satisfaction of Weeks:
i. On or before Contribution, Weeks shall receive from the Lender of
the Existing Loan an estoppel and consent agreement in form and
content reasonably acceptable to Weeks confirming, among such
other matters as Weeks may reasonably require, that it is the
holder of the applicable Existing Loan Documents, the outstanding
principal of the Existing Loan, that no default is then
outstanding, identifying the applicable Existing Loan Documents,
confirming the amounts of any tax and insurance escrows, and
consenting to the Contribution to Weeks of the Development
Property as provided in this Agreement and the assumption by
Weeks, subject to the limited recourse provision therein
contained, of the Existing Loan.
ii. On or before the Contribution, the agreement by the Lender of the
Existing Loan to modification of the applicable Existing Loan
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Documents to reflect change in ownership (e.g., financial
----
reporting requirements, transfer restrictions, deletion of any
personal covenants specific to the Contributors and other matters
that Weeks, in the exercise of commercially reasonably judgment,
deems necessary or appropriate [but in no event, shall Weeks
propose amendments to the loan amount, loan term, payment schedule
or interest rate, except as provided in clause (iii) below]).
iii. The outstanding principal balance of the Existing Loan proposed
to be assumed (A) when added to Existing Loans previously assumed
by Weeks pursuant to this Paragraph must not exceed Twenty-Two
Million Five Hundred Thousand Dollars ($22,500,000); and (B) must
not exceed the Contribution Value of the Development Property it
encumbers.
iv. The Contributors shall pay all transfer fees and all other
expenses and costs imposed by the Lender of the Existing Loan,
including, without limitation, its attorneys' fees and expenses,
as a condition to assumption.
10. TITLE AND SURVEY.
----------------
a. Weeks hereby approves the Permitted Exceptions (including, without
limitation, the Leases identified on the Rent Roll) and agrees to
accept the Contribution of a Development Property subject to the
Permitted Exceptions applicable to the Development Property, except for
those Permitted Exceptions that relate to the Existing Loan that
encumbers that Development Property that is not to be assumed by Weeks
pursuant to Paragraph 9 of this Agreement.
b. Within thirty (30) days before the Contribution Date of a Development
Property, Weeks shall cause title and survey to be updated and Weeks
shall identify in such notice any title exception (other than Permitted
Exceptions) Weeks determines to be objectionable. The Contributors
shall cure any such exception on or before the Contribution Date to
Weeks' reasonable satisfaction and, if such cure is not completed by
that date, then the Contribution shall be delayed for a period not to
exceed sixty (60) days to permit the Contributors additional time to
cure. If after such delay, such title objection is not cured to Weeks'
reasonable satisfaction, Weeks may elect to do one of the following:
(i) cure the exception, with all costs and expenses incurred by Weeks
applied to reduce the Contribution Value and the Adjusted Contribution
Value, in which case the Contribution shall be further delayed an
additional sixty (60) day period, or (ii) terminate this Agreement as
to that Development Property or as to the remaining uncontributed
Development Properties (if the nature of the exception is such that it
affects the remaining uncontributed Development Properties) and sue the
Contributors for damages at law, or (iii) seek specific performance of
the Contributors' obligations hereunder.
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11. DATE, TIME AND PLACE OF CONTRIBUTION. Each Contribution shall
------------------------------------
commence at 9:00 a.m., local time, on the Contribution Date at the
offices of Kennedy Covington Lobdell & Hickman, L.L.P., Two Hanover
Square, Suite 1900, 434 Fayetteville Street Mall, Raleigh, North
Carolina 27602-1070, or at such other place as may be agreed by the
Contributors and Weeks. The following adjustments and prorations shall
be made on the Contribution Date with respect to the Development
Property and the Regency Forest Land to be Contributed on that date by
appropriate cash payments between the Contributors and Weeks.
a. The Contributors shall be entitled to all rents [including any
additional rent and any accrued tax and operating expense
reimbursements, subject to clause (b) below], charges, and other
revenue of any kind attributable to any period under the Leases or
otherwise up to but not including the Contribution Date. Weeks shall be
entitled to all rents [including any additional rent and any accrued
tax and operating expense reimbursements, subject to clause (b) below],
charges and other revenue of any kind attributable to any period under
the Leases or otherwise on and after the Contribution Date. Rents and
expense escalations or other reimbursements due landlord under the
Leases collected prior to the Contribution Date and attributable to
both the Contributors' and Weeks' periods of ownership shall be
prorated as of the Contribution Date. Uncollected rents and expense
escalations or other reimbursements due landlord under the Leases shall
not be prorated at the time of Contribution, but Weeks shall include
such amounts in Weeks' monthly billing statements to the Tenants, make
reasonable efforts to collect the same and tender the same to H.S.
Lichtin, as agent for the Contributors, upon receipt, provided that all
rents, escalations and other reimbursements due landlord under the
Leases collected by Weeks on or after the Contribution Date shall be
prorated as of the Contribution Date and shall first be applied to all
amounts due under the Leases at the time of collection (i.e., current
rents, delinquent rents attributable to periods after Contribution and
sums due Weeks as the current owner and landlord) with the balance (if
any) payable to the Contributors, but only to the extent of amounts
delinquent and actually due the Contributors. The Contributors shall
not have any right to sue any Tenant under the Leases for sums due the
Contributors for periods attributable to the Contributors' ownership of
the Development Property. The Contributors shall pay to Weeks a sum
equal to all Security Deposits (excluding certificates of deposit,
letters of credit or the like which shall be assigned to Weeks at
Contribution to the extent assignable by the Contributors, the
Contributors agreeing to make reasonable efforts to cause the same to
be assignable by the Contributors or otherwise to be assigned to Weeks)
and pre-paid rentals held by the Contributors under the Leases.
b. Real estate taxes shall be prorated as of the Contribution Date. The
Contributors shall be responsible for all real estate taxes
attributable to the Development Property to, but not including the,
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Contribution Date. If the real estate tax rate and assessments have not
been set for the year in which the Contribution occurs, then the
proration of such taxes shall be based upon the rate and assessments
for the preceding tax year, and such proration shall be adjusted in
cash between the Contributors and Weeks upon presentation of written
evidence that the actual taxes paid for the year in which the
Contribution occurs differ from the amounts used at Contribution.
Notwithstanding the foregoing, the Contributors shall be entitled to a
refund of the Contributors' proportionate share of such taxes for which
the Contributors has not been reimbursed by Tenants, to the extent
Weeks after Contribution recovers such reimbursement in taxes
attributable to the year in which Contribution occurs from the Tenants
under the Leases, and Weeks agrees to conduct an annual reconciliation
of tax "pass-through" for the tax year of Contribution in accordance
with the terms of the Leases.
c. Operating expenses for the Development Property shall be prorated as
of the Contribution Date. The Contributors shall pay all utility
charges and other operating expenses attributable to the Development
Property for the period prior to but not including the Contribution
Date (except for those utility charges and operating expenses payable
by Tenants in accordance with the Leases) and Weeks shall pay all
utility charges and other operating expenses attributable to the
Development Property for the period on or after the Contribution Date.
Notwithstanding the foregoing, the Contributors shall be entitled to a
refund of the Contributors' proportionate share of such operating
expenses for which the Contributors has not been reimbursed by Tenants,
to the extent Weeks after Contribution recovers such reimbursement in
operating expenses attributable to the year in which Contribution
occurs form the Tenants under the Leases, and Weeks agrees to conduct
an annual reconciliation of operating expenses "pass-through" for the
Contribution in accordance with the terms of the Leases. The
Contributors shall cause the Project Entity to assign to Weeks any
deposits which the Contributors have with any of the utility services
or companies servicing the Development Property. Weeks shall arrange
with such services and companies to have accounts opened in Weeks' name
as of the day following the Contribution Date, as soon as is reasonably
practicable after Contribution.
d. If the Development Property is to be contributed subject to an
Existing Loan in accordance with the terms and conditions of Paragraph
9 of this Agreement, (i) the Contributors shall make a cash payment to
Weeks equal to the sum of the amount of accrued but unpaid interest due
under the Existing Loan attributable to any period up to, but not
including, the Contribution Date; and (ii) Weeks shall make a cash
payment to the Contributors equal to the amount of any tax, insurance
premium or other escrow deposits maintained pursuant to the Existing
Loan Documents to the extent ownership of such deposits are transferred
to Weeks.
e. If at any time following the Contribution Date the amount of an item
listed in the subparagraphs of this Paragraph 11 shall prove to be
incorrect, the party in whose favor the error was made shall promptly
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pay to the other party the sum necessary to correct such error upon
receipt of proof of such error, provided that such proof is delivered
to the party from whom payment is requested on or before one (1) year
after the Contribution Date.
12. COSTS AND EXPENSES; PREPARATION OF DOCUMENTS. Costs and expenses
--------------------------------------------
shall be apportioned in the following manner:
a. Weeks shall pay the premium for title insurance, the survey fees
(except as provided in Paragraph 21r) and recording costs related to
each Contribution, as well as all costs incurred by it in inspecting
the Development Properties and making such other investigations thereof
as it deems appropriate.
b. The Contributors shall pay all transfer taxes, if any, and any fees
and expense imposed by a Lender under Paragraph 9 hereof.
c. Each party shall pay its own attorneys' fees in connection with this
transaction.
d. Weeks' attorney shall prepare all Contribution documents, which shall
be subject to the reasonable approval of the Contributors' attorney
and which shall be substantially the same as the documents used in
the Initial Contribution.
13. ACCESS TO AND EXAMINATION OF THE DEVELOPMENT PROPERTIES. Weeks,
-------------------------------------------------------
personally or through agents, employees or contractors, may go upon the
Development Properties and the Regency Forest Land during normal
business hours prior to Contribution to conduct such soil, engineering,
environmental and other tests, investigations and analyses of the Land
and Improvements as Weeks deems desirable and to review and make
photocopies of the Leases, lease commission agreements, Service
Contracts, amendments, contracts and plans and specifications relating
to or affecting the Development Properties. Weeks shall pay all costs
incurred in making such tests, analyses, copies, and investigations. In
no event shall Weeks conduct any intrusive or destructive tests,
analyses, or investigations of the Development Properties without first
obtaining the Contributors' written consent, which will not be
unreasonably withheld. Weeks acknowledges that any such examinations or
inspections of the Development Properties pursuant to this subparagraph
or otherwise are subject to the rights of all Tenants, and Weeks agrees
to conduct such inspections or examinations in such a manner so as to
honor the rights of the Tenants and to prevent disruption of the
ordinary operation of the Tenants' business on the Development
Properties. Weeks agrees to repair any damage to the Development
Properties resulting or relating to such inspection or examination and
agrees to and does hereby indemnify, defend, and hold the Contributors
harmless from any personal injury, death, damage to property, damages,
liens, claims, losses, and liabilities arising out of Weeks' exercising
such right and privilege to go upon the Development Properties,
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<PAGE>
including the acts and omissions of Weeks' employees, agents,
contractors and consultants (but under no circumstances shall Weeks be
liable to the Contributors for consequential damages attributable to
the results or findings of such tests). Weeks' indemnity under this
subparagraph shall survive the Contribution or any termination of this
Agreement.
14. REPRESENTATIONS AND WARRANTIES OF THE CONTRIBUTORS. As of the date of
--------------------------------------------------
this Agreement, the Contributors hereby make, jointly and severally,
for the benefit of Weeks the following representations and warranties:
a. Project Entity is a limited partnership or limited liability company
(as applicable), duly formed, validly existing and in good standing
under the laws of the State of North Carolina and has the requisite
authority to enter into and perform this Agreement. The Contributors
are the only general partners, limited partners or members, as
applicable, of Project Entity.
b. The execution, delivery and performance of this Agreement by Project
Entity has been duly and validly authorized by all necessary
partnership or company action. This Agreement has been duly executed
and delivered by the Contributors and constitutes a legal, valid and
binding obligation of the Contributors, enforceable against the
Contributors in accordance with the terms hereof (except as enforcement
may be limited by bankruptcy, insolvency or other laws affecting
enforcement of creditors' rights generally and general equity
principles).
c. Except as has been obtained or is being effected as part of the
consummation of the Transaction, no consent, waiver, approval or
authorization of, or filing, registration or qualification with, or
notice to, any governmental unit or any other regulatory body is
required to be made, obtained or given by the Contributors in
connection with the execution, delivery and performance of this
Agreement by the Contributors or the Project Entities.
d. Except for waivers and consents that have been obtained prior to the
date hereof, except as provided in Paragraph 9 of this Agreement, and
except as would not have a material adverse effect on any of the
Development Properties, no consent of any party to any agreement,
contract, mortgage, indenture, lease, reciprocal easement or operating
agreement or other arrangement, to which the Contributors or Project
Entity is a party, or, by which the Contributors or Project Entity is
bound, is required in connection with the execution, delivery or
performance by the Contributors of this Agreement or the consummation
of the transactions provided for herein.
e. None of the execution, delivery and performance of this Agreement by
the Contributors does or will, with or without the giving of notice,
lapse of time or both, (i) violate, conflict with or constitute a
default under any term or condition of (A) the organizational documents
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<PAGE>
of Project Entity, or (B) any term or provision of any judgment,
decree, order, statute, injunction, rule or regulation of a
governmental unit applicable to the Contributors or Project Entity or
any agreement, contract, mortgage, indenture, lease, reciprocal
easement or operating agreement or other arrangement to which any
Contributor or Project Entity is a party or by which it is bound or to
which any of its assets or any of the Development Properties is
subject, except as provided in Paragraph 9 of this Agreement and except
in the case where appropriate waivers and consents have been obtained
prior to the date hereof, and except as would not have a material
adverse effect on the Contributors, Project Entity or any of the
Development Properties, or (ii) result in the creation of any lien or
other encumbrance upon the assets of the Contributors, Project Entity
or any of the Development Properties, except as may be contemplated by
this Agreement or the other Transaction Documents, and except as would
not have a material adverse effect on the Contributors, Project Entity
or any of the Development Properties.
f. Project Entity has complied with all laws applicable to the conduct of
the business of Project Entity and to the ownership, use and operation
of the Development Properties and has obtained all licenses and permits
required for the conduct thereof, except where the failure to so comply
or obtain will not have a material adverse effect on Project Entity or
any of the Development Properties. To the Contributors' knowledge, such
licenses and permits are in full force and effect, the Contributors and
Project Entity have not taken any action that would (or failed to take
any action the omission of which would) result in the revocation of
such licenses or permits, and the Contributors and Project Entity have
not received any notice of violation from any federal, state or
municipal entity or written notice of an intention by any such
government entity to revoke any certificate of occupancy or other
certificate, license or permit issued by it in connection with the use
of any of the Development Properties, that in each case has not been
cured or otherwise resolved to the satisfaction of such government
entity, except where such failure or such action will not have a
material adverse effect on the Contributors, Project Entity or any of
the Development Properties.
g. With regard to investment:
i. Each Contributor is acquiring Units for its own account and not
with a view to, or for sale in connection with, the
"distribution", as such term is used in Section 2(11) of the
Securities Act of 1933, as amended (the "Securities Act"), of any
of Units in violation of the Securities Act.
ii. Each Contributor is an "accredited investor", as that term is
defined in Rule 501(a) of Regulation D promulgated under the
Securities Act.
iii. Each Contributor understands that the Units have not been
registered under the Securities Act by reason of a specific
exemption from the registration provisions of the Securities Act
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which depends upon, among other things, the nature of the
investment intent and the accuracy of such Contributor's
representations as expressed herein.
h. Each Contributor has had an opportunity to discuss Weeks' business,
management and financial affairs with Weeks' management and the
opportunity to review Weeks' financial records.
i. Each Contributor understands and acknowledges that no public market
now exists for any of the securities issued by Weeks and that there can
be no assurance that a public market will ever exist for the Units.
j. Each Contributor has such knowledge and experience in financial and
business matters that each Contributor is capable of evaluating the
merits and risks of the purchase of the Units pursuant to this
Agreement and of protecting each Contributor's interests in connection
herewith.
k. The Contributors and Project Entity have not knowingly caused or
permitted any Hazardous Material to be improperly maintained or
disposed of on, under or at any of the Development Properties or any
part thereof. To the Contributors' knowledge, and except as may be
revealed in the environmental reports (which are identified in
Exhibit J): (i) no liability under or violation of any Environmental
---------
Laws exists with respect to Development Properties, (ii) the
Contributors and Project Entity have not received any written notice
from any governmental agency or instrumentality having jurisdiction
thereof of any violation of any Environmental Laws that remains uncured
as of the date hereof or that it has any material liability with
respect thereto, (iii) there are no administrative, regulatory or
judicial proceedings pending or threatened against Project Entity
pursuant to, or alleging any material violation of, or material
liability under any Environmental Laws, (iv) none of the properties now
or heretofore owned, leased or used by Project Entity has been used as
a storage or disposal site (whether temporary or permanent) for any
hazardous, toxic or dangerous materials the storage or disposal of
which is governed by any Environmental Laws in violation of such
Environmental Laws, (v) there are no underground storage tanks located
on, under or about any of the Development Properties, and there is no
facility located on or at any of the Development Properties that is
subject to the reporting requirements of Section 312 of the Federal
Emergency Planning and Community Right to Know Act of 1986 and the
federal regulations promulgated thereunder (42 U.S.C. (S) 11022), and
(vi) no Hazardous Material has been improperly maintained or disposed
of on, under or at any of the Development Properties or any part
thereof. In connection with the representations and warranties in this
subparagraph, Weeks acknowledges that the Contributors disclaims any
professional expertise with respect to Environmental Laws.
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l. With respect to the Development Properties, Project Entity (i) is the
sole owner and (ii) has good, valid and marketable title, free and
clear of all liens other than the following:
i. Liens securing the Existing Loans, Liens, or deposits made to
secure the release of such Liens, securing taxes, the payment of
which is at the time not delinquent or the payment of which is
actively being contested in good faith by appropriate proceedings
diligently pursued, and for which appropriate reserves shall have
been established by Project Entity.
ii. Attachments, judgments and other similar liens arising in
connection with court or administrative proceedings, provided,
that the execution or other enforcement of such liens is
effectively stayed or secured and the claims secured by such liens
are actively being contested in good faith by appropriate
proceedings diligently pursued, and for which appropriate reserves
shall have been established by Project Entity.
iii. Zoning laws and ordinances; provided that, to the Contributors'
knowledge, none of the Development Properties are in violation
thereof, in any material respect and that such laws and ordinances
do not require the demolition, vacation or cessation of the use
for industrial or office purposes (as applicable) of any portion
of the improvements material to each of the Development Properties
or require the discontinuance of the use of all or any material
portion of any of the Development Properties as industrial
facilities or office buildings.
iv. Any laws, ordinances, deeds of trust, mortgages, liens,
easements, rights of way, restrictions, exemptions, reservations,
conditions, limitations, covenants, encumbrances, adverse rights
or interests and other matters defined as Permitted Exceptions;
provided that, to the Contributors' knowledge, the Development
Properties are not in violation thereof in any material respect
and the same do not require the demolition, vacation or cessation
of the use of for industrial or office purpose of any portion of
the improvements material to such Development Properties or
require the discontinuance of the use of all or any material
portion of such Development Properties as industrial facilities or
office buildings.
v. Any other easements, rights of way, restrictions, exceptions,
reservations, conditions, limitations, covenants, adverse rights
or interests, licenses, minor irregularities in title and other
similar encumbrances which do not in the aggregate materially
impair the use of such properties in the operation of the business
of Project Entity.
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vi. Any law or governmental regulation or other right of any
governmental unit, which (i) requires the person to maintain
certain facilities or perform certain acts as a condition of its
occupancy or use of its assets and properties, or (ii) condemns,
appropriates or recaptures the person's assets or property.
vii. Liens imposed by laws, such as carriers', warehousemen's and
mechanics' Liens and other similar Liens arising in the ordinary
course of business which secure payment of obligations not more
than sixty (60) days past due or which are being contested in good
faith by appropriate proceedings diligently pursued, and for which
appropriate reserves shall have been established by Project
Entity.
m. The Contributors and Project Entity have not received any written or
other actual notice of any violation of any applicable zoning
regulation or ordinance, or of any employment or other regulatory law,
order, regulation or requirement relating to Project Entity's
operations, practices, properties or assets that remain uncured as of
the date hereof, and, to the Contributors' Knowledge, there are no such
violations that, individually or in the aggregate, will have a material
adverse effect on any of the Development Properties.
n. Project Entity has no liabilities of any nature, whether matured or
unmatured, fixed or contingent, regardless of whether the disclosure
thereof would otherwise be required by GAAP, which would have,
individually or in the aggregate, a material adverse effect upon
Project Entity or any of the Development Properties except for
(1)Leases identified on the Rent Roll, (2) the commission obligations
defined on Exhibit P hereto, (3) Existing Loan Documents, (4) the
---------
Permitted Exceptions and (5) the Service Contracts (collectively, the
"Significant Agreements"), or as shown on the audits of the books and
records described in Section 8.2 of the Contribution Agreement for
Completed Properties.
o. With respect to the Existing Loans, the Contributors represent and
warrant as follows:
i. The loan documents identified on Exhibit C hereto constitute all
---------
of the documents that evidence or secure the Existing Loans; and
such documents have not been amended or modified except as
expressly identified on said Exhibit C. The Contributors have
---------
delivered to Weeks true, correct and complete copies of all of the
Existing Loan Documents.
ii. All payments due and payable on or before the date of this
Agreement under the Existing Loan Documents by Project Entity have
been paid, and no monetary default exists as of the date of this
Agreement.
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iii. As of the date of this Agreement, no written notice of a default
is outstanding and, to the Contributors' Knowledge, no condition
exists which with the giving of notice or the passage of time or
both would constitute an event of default under the Existing Loan
Documents.
p. Each of the Significant Agreements referred to in subparagraph n above
is (to the Contributors' Knowledge, with respect to parties thereto
other than Project Entity) valid and binding and in full force and
effect, enforceable against the parties thereto in accordance with its
terms (except as enforcement may be limited by bankruptcy, insolvency
or other laws affecting enforcement of creditors' rights generally and
general equitable principles).
q. Other than as set forth in Exhibit K hereto, there are no claims,
actions, suits, proceedings or investigations pending, or, to the
Contributors' knowledge, threatened, before any court, governmental
unit or arbitrator with respect to any Project Entity or any
Development Property, and, to the Contributors' knowledge, the likely
outcome of the claims or other matters set out in said Exhibit K, will
not have a material adverse effect on the Contributors or any of the
Development Properties.
r. Each Project Entity is classified as a partnership for federal income
tax purposes and not as an association taxable as a corporation.
s. The Rent Roll attached hereto as Exhibit H for the Development
---------
Properties is true, correct and complete with respect to the categories
described therein, except to the extent any inaccuracies would not,
individually or in the aggregate, have a material adverse effect on the
value of any of the Development Properties.
t. The Rent Roll lists each of the Leases in effect as of the date of the
Rent Rolls with respect to the Development Properties. In the case of
any sublease or assignment of any such Lease, the Tenant listed in such
Rent Roll remains liable for the performance of said Lease.
u. Except as disclosed in the engineering reports listed in Exhibit L,
---------
attached hereto and by this reference made a part hereof, the
Improvements are in good condition and repair and have not suffered any
material casualty or, to the Contributors' Knowledge, other material
damage that has not been repaired in all material respects. To the
Contributors' Knowledge, there is no material latent or patent
structural, mechanical or other significant defect or deficiency in the
Improvements, other than as disclosed in said engineering reports.
v. No proceedings have been commenced, or, to the Contributors' Knowledge,
threatened, by any authority having the power of eminent domain to
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condemn any part of any of the Development Properties or any
Improvements thereon that, if successful, would have a material adverse
effect on any of the Development Properties.
w. To the Contributors' Knowledge, none of the Tenants now occupying the
Development Properties or having a Lease of space in the Development
Property is the subject of any bankruptcy, reorganization, insolvency
or similar proceedings.
x. Exhibit M, attached hereto and by this reference made a part hereof,
---------
sets forth an accurate and complete list of the insurance policies
relating to the Development Properties or any part thereof obtained by
and naming the Project Entities (other than policies obtained or
maintained by tenants); all such policies are in full force and effect
and all premiums thereunder have been paid to the extent due; and no
notice of cancellation has been received with respect thereto and, to
the Contributors' Knowledge, none is threatened.
y. No representation or warranty by the Contributors herein contains any
untrue statement of a material fact or omits to state a material fact
necessary in order to make the statements contained herein, in light of
the circumstances under which they were made, not misleading.
z. None of Project Entity, its general partners or limited partners, as
applicable, owns, directly or indirectly, (i) one percent (1%) or more
of the total combined voting power of all classes of stock entitled to
vote, or one percent (1%) or more of the total number of shares of all
classes of stock, of any corporation that is a Tenant or (ii) an
interest of one percent (1%) or more in the assets or net profits of
any Tenant.
aa. Project Entity has not received written notice that any Tenant intends
either to cease such operations (other than temporarily due to
casualty, remodeling, renovation or any similar cause) or to cease
operating under the name under which it was operating as of the date
hereof.
bb. To the Contributors' Knowledge, no condition exists which, with the
giving of notice or the passage of time, or both, would permit any
party to cancel its obligations under any reciprocal easement agreement
or lease.
cc. Except for routine repairs and maintenance, all alterations,
improvements or other work required to have been completed by Project
Entity under any reciprocal easement agreements and Leases, including,
without limitation, all alterations, improvements and other work
required to prepare space for the initial occupancy of each tenant
under a Lease, has heretofore been completed and paid for in full,
except to the extent reflected in Exhibit N, attached hereto and by
---------
this reference made a part hereof.
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dd. Each of the Development Properties is an independent unit which does
not now rely on any facilities (other than facilities covered by
Permitted Exceptions including, without limitations, any reciprocal
easement agreements or facilities of municipalities or public utility
and water companies and other than parking areas which the Development
Properties make use of under any reciprocal easement agreements)
located on any property not included in the Real Property that is part
of that Development Property to fulfill any municipal or governmental
requirement or for the furnishings to the Development Properties of any
essential building systems or utilities.
ee. Project Entity has not received any written notice which is still in
effect that there is, and, to the Contributors' Knowledge, there does
not exist, any violation of a condition or agreement contained in any
easement, restrictive covenant or any similar instrument or agreement
affecting the Development Properties or any portion thereof, if such
violation would have a material adverse effect on any of the
Development Properties.
ff. Project Entity is not in violation of any radius restrictions,
exclusive or similar provisions contained in any reciprocal easement
agreements, Leases or any other agreements to which Project Entity is a
party or is bound, if such violation would have a material adverse
effect on Project Entity or any of the Development Properties.
gg. Project Entity is solvent, has not made a general assignment for the
benefit of its creditors, and has not admitted in writing its inability
to pay its debts as they become due, nor has Project Entity filed, nor
does it contemplate the filing of, any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings, or any other
proceeding for the relief of debtors in general, nor has any such
proceeding been instituted by or against Project Entity, nor is any
such proceeding to the Contributors' Knowledge threatened or
contemplated.
hh. Attached hereto as Exhibit O is a schedule of the Service Contracts
---------
now in effect to which Project Entity and/or the Development Properties
are subject. No notice of default has been received by Project Entity
from any of the parties to the Service Contracts and, to the
Contributors' Knowledge, no event has occurred which, with notice or
lapse of time, or both, will constitute any such default. There are no
Service Contracts affecting any of the Development Properties other
than as listed on said Exhibit O, and the Service Contracts are in full
---------
force and effect.
ii. All leasing commissions payable in connection with the Leases now in
occupancy have been paid-in-full, including leasing commissions payable
with respect to extensions, expansions and renewals which have not been
exercised as of the date hereof or payable in the event a Tenant does
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<PAGE>
not exercise a cancellation right under its Lease, except for
commission obligations identified on Exhibit P, attached hereto and by
---------
this reference made a part hereof.
jj. The Contributors do not lease space at the Development Properties, and
no tenant at the Development Properties is "related" to the
Contributors or the Project Entities within the meaning of Section
267(b) or Section 707(b) of the Internal Revenue Code of 1986, as
amended.
kk. No interest in the Development Properties is or is deemed to be,
directly or indirectly, an asset of a "Plan" (as defined in the next
sentence). "Plan" means an "employee benefit plan" as defined in
Section 3(3) of the Employee Retirement Income Security Act of 1974, as
amended, or a "plan" within the meaning of Section 4975(e)(1) of the
Internal Revenue Code of 1986, as amended.
ll. Each Project Entity is classified as a partnership for federal income
tax purposes and not as an association taxable as a corporation.
mm. With regard to construction of tenant improvements under the Lease to
Raleigh/Durham MSA in the Regency-Sprint Development Property, the
Lease to Time-Warner in the Woodlake III Development Property and the
Lease to Apria Healthcare in the Enterprise III Development Property,
to the knowledge of the Contributors, no tenant has claimed a default
as a result of construction delay or otherwise.
nn. The representations and warranties of the Contributors contained in
this Paragraph 14, as updated and reaffirmed at each Contribution Date,
shall continue in effect as provided in the Partnership Amendment.
15. REPRESENTATIONS AND WARRANTIES OF WEEKS. Weeks represents and
---------------------------------------
warrants to the Contributors, as follows:
a. Weeks is a limited partnership duly formed, validly existing and in
good standing under the laws of the State of Georgia. By the first
Contribution Date, Weeks will be qualified to transact business in the
State of North Carolina. Weeks has full power and authority to execute
and deliver this Agreement and all other documents executed and
delivered, or to be executed and delivered, by it (contemporaneously
herewith or at Contribution) in connection with the transactions
described herein and to perform all of its obligations arising under
this Agreement and such other documents; the officers executing this
Agreement and such other documents on behalf of Weeks have the
authority to bind Weeks hereunder and thereunder.
b. Neither the execution and delivery of this Agreement nor any other
documents executed and delivered, or to be executed and delivered by
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<PAGE>
Weeks (contemporaneously herewith or at Contribution) in connection
with the transactions described herein will violate any provision of
Weeks' limited partnership agreement, articles of incorporation or by-
laws of Weeks' General Partner or of any agreements, regulations, or
laws to which Weeks is bound, except for waivers and consents that have
been obtained prior to the date hereof.
c. To Weeks' knowledge, there is no action, suit, proceeding, or claim
affecting Weeks pending or being prosecuted in any court or by or
before any federal, state, county, or municipal department, commission,
board, bureau, agency, or other governmental instrumentality which
would prevent consummation by Weeks of the Contribution of the
Development Properties or materially and adversely affect the
performance of any of Weeks's other obligations hereunder to be
performed prior to, at or after Contribution.
d. Weeks is solvent, has not made a general assignment for the benefit
of its creditors, and has not admitted in writing its inability to pay
its debts as they become due, nor has Weeks filed, nor does it
contemplate the filing of, any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings, or any other proceeding for the
relief of debtors in general, nor has any such proceeding been
instituted by or against Weeks, nor is any such proceeding to Weeks'
knowledge threatened or contemplated.
16. CONDITIONS.
----------
a. In addition to any other conditions provided in this Agreement, Weeks'
obligation to accept Contribution of a Development Property pursuant to
this Agreement is subject to the satisfaction of each of the following
conditions at or prior to the Contribution Date for that Development
Property:
i. The Contributors shall have complied with and performed all of
its obligations and covenants set forth in this Agreement.
ii. On or before the Contribution Date, the Contributors shall have
executed and delivered all documents required to be delivered by
the Contributors pursuant to the terms of this Agreement.
Additionally, the Contributors shall have delivered to Weeks
reasonable evidence of its authority to consummate the
transaction herein contemplated, including without limitation,
an opinion of counsel in form and content reasonably acceptable
to Weeks.
iii. All of the representations and warranties made by the
Contributors in Paragraph 14 shall be true correct at and as of
the Contribution Date as though such representations and
warranties were made both at and as of the date hereof and at and
as of the Contribution Date. Provided, further, the
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<PAGE>
representations and warranties concerning Rent Roll and Leases,
when reaffirmed at Contribution shall be made with respect to a
Rent Roll made as of Contribution and such Rent Roll shall
disclose no material changes from the Rent Roll attached hereto
as Exhibit H, except those approved by Weeks in writing.
---------
iv. The Contributors shall have obtained and delivered to Weeks by
the date and time of Contribution a Tenant Estoppel Certificate
for all Leases then in effect in the Development Property, each
duly executed by an authorized officer of the Tenant under such
Lease and dated no earlier than sixty (60) days before the
Contribution Date. The Contributors agrees to use the
Contributors' diligent good faith efforts to obtain such Tenant
Estoppel Certificates at or prior to Contribution. Any material
modification to the form of Tenant Estoppel Certificate shall be
approved in writing by Weeks in advance and, in Weeks'
discretion, may be the basis upon which Weeks excludes such
certificate in the determination as to whether this condition has
been satisfied. During the term of this Agreement, as and when
received, the Contributors shall provide to Weeks copies of each
Tenant Estoppel Certificate received from any Tenant promptly
after receipt of such Tenant Estoppel Certificate. Weeks shall
have the right to delay Contribution by up to thirty (30) days by
written notice to the Contributors if the Contributors has not
obtained the required Tenant Estoppel Certificates.
v. No material adverse change shall have occurred to the
Development Properties, except as otherwise provided in 17
and 18.
vi. The Contributors shall have completed construction of the
Improvements as required under this Agreement as evidenced by the
foregoing (A) final, unconditional certificate(s) of occupancy
for the building shell(s) and each leased tenant space shall have
been issued by the appropriate governmental authority; (B) the
building shell(s) and each leased tenant space shall have been
completed substantially in accordance with plans and
specifications approved by Weeks (which approval shall not be
unreasonably withheld or delayed), subject only to customary
punch list items approved by Weeks and appropriate reserves
established with Weeks to Weeks' reasonable satisfaction for such
items; and(C) all contractors shall have been paid-in-full
(subject to retainage for punchlist items) and released any lien
rights in the Development Property and appropriate evidence of
such shall have been furnished to Weeks including, without
limitation, a final general contractor's affidavit and lien
waiver, if applicable.
vii. A title insurance company approved by Weeks shall be prepared to
issue to Weeks title insurance coverage on ALTA Form Policy
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<PAGE>
issued by a title insurance company approved by Weeks, in an
amount not in excess of the Adjusted Contribution Value, and
specifying as exceptions to coverage only the Permitted
Exceptions.
viii. The contingencies set forth in this Paragraph 16(a) are for the
sole benefit of Weeks, and Weeks may elect in writing to waive
any such contingency reserved for its benefit and proceed to
consummate the transaction contemplated hereby.
b. In addition to any other conditions provided in this Agreement, the
Contributors' obligation to contribute a Development Property is
subject to the satisfaction of each of the following conditions at or
prior to the Contribution Date for that Development Property:
i. Weeks shall have complied with and performed all of its
obligations and covenants set forth in this Agreement.
ii. On or before the Contribution Date, Weeks shall have executed
and delivered all documents required to be delivered by Weeks
pursuant to the terms of this Agreement, and shall have issued
Units and made cash payments to Contributors as required under
Paragraph 7 hereof. Additionally, Weeks shall have delivered to
the Contributors reasonable evidence of its authority to
consummate the transaction herein contemplated, including without
limitation, an opinion of counsel in form and content reasonably
acceptable to the Contributors.
iii. All of the representations and warranties made by Weeks in
Paragraph 15 shall be true and correct at and as of the
Contribution Date as though such representations and warranties
were made both at and as of the date hereof and at and as of the
Contribution Date.
iv. The contingencies set forth in this Paragraph 16(b) are for the
sole benefit of the Contributors, and the Contributors may elect
in writing to waive any such contingency reserved for its benefit
and proceed to consummate the transaction contemplated hereby.
17. FIRE AND CASUALTY. Prior to the Contribution of a Development
-----------------
Property, the risk of loss shall remain with the Contributors and the
Contributors shall bear all ownership risks and obligations, including
construction risks and the risk of cost overruns. The Contributors
shall maintain in effect until the Contribution Date all insurance
policies currently in force with respect to the Development Property to
be contributed including liability insurance and fire and extended
coverage insurance. If at any time prior to the Contribution Date any
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<PAGE>
portion of the Development Properties is destroyed or damaged as a
result of fire or any other casualty (a "Casualty"), the Contributors
shall promptly give written notice (a "Casualty Notice") thereof to
Weeks. If a Development Property is the subject of a Casualty, Weeks
shall have the right, at its sole option, of terminating this Agreement
(by written notice to the Contributors given within thirty (30) days
after receipt of the Casualty Notice from the Contributors) as to that
Development Property, unless
(a) (i) all such damage or destruction is repaired at the sole
cost and expense of the Contributors prior to Contribution to
substantially the condition existing immediately prior to such damage
or destruction, or (ii) the cost to fully repair or restore such damage
is less than Two Hundred Fifty Thousand Dollars ($250,000) and either
(x) insurance proceeds sufficient to restore fully such damage are
available and the insurance company issuing the Contributors' insurance
policies has confirmed in writing prior to the expiration of such
thirty (30) day period that such Casualty is covered by such policies
and that no defense to payment of the claim on account thereof exists,
or (y) the Contributors give Weeks a credit at Contribution (the
"Credit") in an amount equal to the deficiency in any insurance
proceeds described in clause (x); and
(b) such Casualty (i) does not result in Tenants occupying more
than twenty-five (25%) of the space in the Development Property in the
aggregate terminating their Leases or asserting a right to terminate
their Leases.
If a Casualty Notice is given to Weeks less than thirty (30) days prior to
Contribution, at Weeks' option Contribution shall be postponed to a date
not earlier than thirty (30) days after Weeks' receipt of the Casualty
Notice. If Weeks terminates this Agreement pursuant to this Paragraph,
then this Agreement shall terminate and the parties hereto shall have no
further rights or obligations hereunder, with regard to that Development
Property. If Weeks does not terminate this Agreement, the proceeds of any
insurance with respect to the Development Property paid between the date of
this Agreement and the Contribution Date, together with the Credit if
applicable, shall be paid to Weeks at the time of Contribution and all
unpaid claims and rights in connection with property damage to the
Development Properties shall be assigned to Weeks at Contribution without
in any manner affecting the Adjusted Contribution Value.
18. EMINENT DOMAIN. In the event of a taking by condemnation or eminent
--------------
domain proceedings of any material portion of a Development Property
[prior to Contribution, the Contributors shall promptly give written
notice thereof to Weeks and Weeks shall have the right, at its sole
option, of terminating this Agreement as to that Development Property
by written notice given to the Contributors on or before the tenth
(10th) day following receipt of such notice. For purposes hereof, a
"material portion" of any Development Property shall be any portion
upon which an improvement is located, any portion which contains enough
parking spaces, the loss of which would cause a violation of any Lease
on the Development Property or cause a violation of any applicable
zoning ordinance or which permanently alters the access to and from the
Property in a material adverse way. If Weeks so terminates this
Agreement as to that Development Property, then this Agreement shall
terminate as to that Development Property, and the parties hereto shall
have no further rights or obligations hereunder. If Weeks does not
-31-
<PAGE>
terminate the Agreement pursuant to this Paragraph as to that
Development Property, then the Contributors shall pay over to Weeks on
the Contribution Date all monies received or collected by the
Contributors by reason of such taking, and the Contributors shall
further assign and transfer to Weeks all of the Contributors' right,
title and interest of, in and to any awards that have been or may be
made for such condemnation or eminent domain proceedings and the
additional money that may be payable when the same is and becomes
assignable as a matter of law.
19. DEFAULT.
-------
a. If Weeks defaults hereunder, the Contributors may either proceed
against Weeks at law for damages or seek specific performance of Weeks'
obligations hereunder.
b. If the Contributors default hereunder, Weeks may either proceed
against the Contributors at law for damages or seek specific
performance of the Contributors' obligations hereunder. After notice as
provided in Paragraph 19(c) below, and lapse of cure period without
cure by the Contributors, Weeks may elect to cure the Contributors'
default hereunder and the Contributors shall promptly, upon demand,
reimburse Weeks for all costs and expenses incurred in cure, including
interest on such costs and expenses, at a rate equal to LIBOR plus one
hundred and thirty five (135) basis points, per annum, from the date
incurred until the date of reimbursement, and upon Contribution of the
Development Property in question, if ever, the Adjusted Contribution
Value for such Development Property shall be reduced by such costs and
expenses of cure and accrued interest thereon.
c. Prior to exercising any of its rights hereunder or at law or in equity
for a default, a party shall give the other party written notice of
such default hereunder and the other party shall have thirty (30) days
to cure such default from and after such notice.
d. After Closing, the liability of the Contributors for a breach of the
representations and warranties by the Contributors in this Agreement
shall be governed by the Partnership Amendment and the pledge of Units
and Shares of therein contained.
20. BROKERAGE FEES. Except for brokers paid-in-full at the Initial
--------------
Contribution pursuant to separate written agreements for the entire
Transaction, the Contributors and Weeks each represent and warrant to
the other that they have not employed, retained, or consulted any
broker, agent, or finder in connection with this Agreement or the
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<PAGE>
Contribution, and the Contributors and Weeks each hereby indemnify and
agree to hold the other harmless from and against any and all claims,
demands, causes of action, debts, liabilities, judgments and damages
(including costs and reasonable attorneys' fees incurred in connection
with the enforcement of this indemnity) which may be asserted or
recovered against the indemnified party for or on account of any
brokerage fee, commission, or other compensation arising by reason of
the indemnitor's breach of this representation and warranty.
21. MISCELLANEOUS.
-------------
a. Weeks shall not assign, sell, convey or otherwise transfer any or all
its rights under this Agreement without the prior written consent of
the Contributors. The Contributors shall not assign, sell, convey, or
otherwise transfer any or all of the Development Properties or its
rights under this Agreement without the prior written consent of Weeks.
No such assignment by the Contributors or Weeks shall relieve or
release the assigning party of any liability hereunder. Subject to the
foregoing, this Agreement and the terms and provisions hereof shall
inure to the benefit of and be binding upon the successors and assigns
of the parties.
b. This Agreement and the other Transaction Documents supersedes all prior
agreements between the parties hereto with respect thereto. No claim of
waiver, modification, consent or acquiescence with respect to any of
the provisions of this Agreement shall be made against either party,
except on the basis of a written instrument executed by or on behalf of
such parties.
c. This Agreement shall be governed by and construed in accordance with
the laws of the State of North Carolina.
d. The headings of the several paragraphs and subparagraphs of this
Agreement are inserted solely for the convenience of reference and are
not a part of and are not intended to govern, limit, or aid in the
construction of any term or provision hereof, except otherwise provided
in Paragraph 1 of this Agreement.
e. Words of any gender used in this Agreement shall be held and construed
to include any other gender, and words of a singular number shall be
held to include the plural and vice versa, unless the context requires
otherwise.
f. Any notice, request or other communication (a "notice") required or
------
permitted to be given hereunder shall be in writing and be delivered by
hand or overnight courier (such as UPS Next Day Air) or by facsimile
transmission or mailed by United States registered or certified mail,
return receipt requested, postage prepaid and addressed to each party
at its address as set forth below. Any such notice shall be considered
given on the date of such hand or courier delivery, deposit with such
overnight courier for next business day delivery, or upon transmission
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<PAGE>
by facsimile with confirmation, or deposit in the United States mail,
but the time period (if any is provided herein) in which to respond to
such notice shall commence on the date of hand or courier delivery or
the confirmation date of facsimile transmission or on the date received
following deposit in the United States mail as provided above.
Rejection or other refusal to accept or inability to deliver because of
changed address of which no notice was given shall be deemed to be
receipt of the notice. By giving at least five (5) days' prior written
notice thereof, any party may from time to time and at any time change
its mailing address hereunder. Any notice of any party may be given by
such party's counsel. The parties respective notice addresses are as
follows:
Weeks: Weeks Realty, L.P.
4497 Park Drive
Norcross, Georgia 30093
Attention: Thomas D. Senkbeil,
Vice Chairman/Chief
Investment Officer
Fax: (770) 717-3310
With Copy To: King & Spalding
191 Peachtree Street
Atlanta, Georgia 30303-1763
Attention: William J. Armstrong, Esq.
Fax: (404) 572-5148
Contributors: Harold S. Lichtin
Suite 200
1800 Perimeter Park Drive
Morrisville, North Carolina 27560
Fax: (919) 467-4428
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<PAGE>
With Copy To: Kennedy Covington Lobdell & Hickman, L.L.P.
Two Hannover Square
Suite 1900
434 Fayetteville Street Mall
Raleigh, North Carolina 27602
Attention: Alan H. Peterson, Esq.
Fax: (919) 743-7358
g. If any provision of this Agreement or the application thereto to any
person or circumstance shall be invalid or unenforceable to any extent,
the remainder of this Agreement and the application of such provisions
to the other persons or circumstances shall not be affected thereby and
shall be enforced to the greatest extent permitted by law.
h. Nothing in this Agreement shall be construed as giving any person,
firm, corporation, or other entity, other than the parties hereto,
their successors and assigns, any rights, remedy or claim under or in
respect to this Agreement or any provision hereof.
i. This Agreement may be executed in any number of counterparts, each of
which so executed shall be deemed an original; such counterparts
together shall constitute the one agreement.
j. Time is of the essence of this Agreement; provided, however, that if
-------- -------
the time within which any action, consent, approval, or other activity
herein contemplated, expires on a Saturday, Sunday, or legal holiday,
such time period shall automatically be deemed extended to the first
day after the scheduled termination of such time period which is not a
Saturday, Sunday, or legal holiday.
k. No failure or delay by a party to exercise any right it may have by
reason of the default of the other party shall operate as a waiver of
default or modification of this Agreement or shall prevent the exercise
of any right by the first party while the other party continues to be
so in default.
l. All representations, warranties and agreements of the Contributors and
Weeks contained in this Agreement shall not be merged into the
Contribution documents and shall survive Contribution subject to the
provisions of the Partnership Amendment.
m. In the event of a breach of this Agreement by either party, the
non-breaching party shall be entitled to recover all costs associated
with enforcing this Agreement, including reasonable attorneys' fees and
expenses actually incurred.
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<PAGE>
n. So long as a Development Property and the Regency Forest Land is
subject to this Agreement, the Contributors agree not to offer to any
party other than Weeks, that properties, or any portion thereof or any
interest therein, for sale or lease, except for the leasing of space
pursuant to the terms of this Agreement, and the Contributors agree not
to negotiate, solicit or entertain any offers from or with any party
other than Weeks, to purchase or lease the property, or any portion
thereof or any interest therein, except for the leasing of space as
aforesaid.
o. Contemporaneously with the execution and delivery of this Agreement,
Weeks and the Contributors shall enter into a short form memorandum of
this Agreement, which shall be recorded in the public records of Wake
County, North Carolina, to give notice of Weeks' interest in the
Development Properties pursuant to this Agreement.
p. The Contributors hereby appoint H.S. Lichtin as their authorized
representative under this Agreement. Any direction, consent, approval,
disapproval, authorization or other action required or permitted to be
given or taken under this Agreement by any of the Contributors shall be
given or taken only by H.S. Lichtin. In giving notice to the
Contributors under this Agreement, Weeks may give such notice only to
H.S. Lichtin as provided under Paragraph 21f of this Agreement and such
notice shall constitute notice to all of the Contributors. If Weeks
receives notice of any matter from any Contributor who is not H.S.
Lichtin, Weeks shall be entitled at its discretion to disregard such
notice and such notice shall have no legal effect under this Agreement,
unless and until confirmed by H.S. Lichtin. The written statements and
representations of H.S. Lichtin shall for the purposes of this
Agreement be binding upon the Contributors and Weeks shall have no
obligation or duty whatsoever to inquire into the authority to take any
action which he proposes to take, regardless of whether H.S. Lichtin
actually has the authority to take any such action; and Weeks shall be
entitled to rely upon any direction, authorization, consent, approval
or disapproval given by H.S. Lichtin in connection with any matter
arising out of or in connection with this Agreement.
q. For any Development Property Contributed after July 1, 1997, but prior
to achievement of Stabilization, as permitted pursuant to Paragraph 4b
of this Agreement, the Adjusted Contribution Value (using for the
purpose of the recomputation the outstanding principal balance of any
applicable Existing Loan on the Contribution Date) shall be recomputed
as of the earlier of (i) the date the Development Property first
achieves Stabilization, or (ii) June 30, 1998, and, if this newly
recomputed Adjusted Contribution Value exceeds the Adjusted
Contribution Value determined on the Contribution Date for this
Development Property, Weeks shall issue to the Contributors in respect
of such previously Contributed Development Property an additional
number of Units equal to the quotient of (y) such excess divided by (z)
the Unit Price [determined as of the date of recomputation under this
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<PAGE>
subparagraph]. Any Units issued pursuant to this subparagraph shall be
subject to the provisions of Paragraph 7b and 7c of this Agreement.
r. With regard to the Regency Forest Land, the Contributors and Weeks
agree as follows:
i. As of the date of this Agreement, the Regency Forest Land and
the Land for the Regency-Sprint Development Property are a single
unsubdivided tract of land. As soon as is reasonably practicable
and as soon as is permitted by the City of Cary, North Carolina,
the Contributors, at their sole cost and expense, agree to have
the Regency Forest Land and the land for the Regency-Sprint
Development Property subdivided pursuant to a subdivision map or
plat approved by the City of Cary and approved by Weeks in its
reasonable discretion. In any event, the Contributors agree to
have this subdivision completed not later than the earlier of the
date of the issuance of a Certificate of Occupancy for the
building shell of the building currently under construction for
the Regency-Sprint Development Property or the Contribution Date
for the Regency-Sprint Development Property provided for in this
Agreement.
ii. Within ten (10) business days after approval of the subdivision
map, as described in the immediately preceding clause, the
Contributors agree to cause the Project Entity to convey good and
marketable fee simple title to the Regency Forest Land to Weeks by
general warranty deed, subject only to permitted title exceptions
approved by Weeks. Additionally, any loan encumbering the Regency
Forest Land shall be paid in full by the Contributors and canceled
immediately prior to conveyance of the Regency Forest Land to
Weeks.
iii. In consideration for such conveyance, Weeks shall issue Units to
the Contributors (pro rata in accordance with their respective
membership interests in the Project Entity which owns the Regency
Forest Land) a number of Units equal to One Million Dollars
($1,000,000) divided by the Unit Price (for this purpose the Unit
Price shall be deemed to be Twenty-Five Dollars and Twenty-Five
Cents ($25.25)). All Units so issued shall be held by the
Contributors subject to the applicable rights agreements.
iv. As of the date of this Agreement, the Contributors hereby make,
jointly and severally, for the benefit of Weeks, each and every
representation and warranty set forth in Paragraph 14 of this
Agreement as to the Regency Forest Land, to the extent applicable
to unimproved land. At the date the Regency Forest Land is
conveyed to Weeks, the Contributors shall remake, for the benefit
the of Weeks, each and every representation and warranty set forth
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<PAGE>
in Paragraph 14 as to the Regency Forest Land, to the extent
applicable to unimproved land. Weeks acknowledges and agrees that
the liability of the Contributors for breach of these
representations, and warranties are subject in all respects to the
limitations on liability set forth in the Partnership Amendment
and the pledge of Units and shares therein contained.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above stated.
CONTRIBUTORS:
------------
(SEAL)
----------------------------------
HAROLD S. LICHTIN
(SEAL)
----------------------------------
MARIE ANTOINETTE ROBERTSON
(SEAL)
----------------------------------
NOEL LICHTIN
PERIMETER PARK WEST ASSOCIATES
LIMITED PARTNERSHIP,
a North Carolina limited partnership
By: (SEAL)
-------------------------------
Harold S. Lichtin,
General Partner
By: (SEAL)
-------------------------------
Marie Antoinette Robertson,
General Partner
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<PAGE>
WEEKS:
-----
WEEKS REALTY, L.P., a Georgia limited
partnership authorized to do business
in the State of North Carolina as
Weeks Realty Limited Partnership
By: Weeks GP Holdings, Inc., a Georgia
corporation, sole general partner
By:
-------------------------------------
Title:
----------------------------------
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<PAGE>
THIRD AMENDED AND RESTATED BYLAWS
OF
WEEKS CORPORATION
ARTICLE I
SHAREHOLDERS
------------
Section 1. Annual Meeting. The annual meeting of the shareholders for
--------- --------------
the election of directors and for the transaction of such other business as may
properly come before the meeting shall be held at such place, either within or
without the State of Georgia, on such date, and at such time, as the Board of
Directors may by resolution provide, or if the Board of Directors fails to
provide, then such meeting shall be held at the principal office of the
Corporation at 10:00 a.m., local time, on the fourth Tuesday in April of each
year, if not a legal holiday under the laws of the State of Georgia, and if a
legal holiday, on the next succeeding business day. The Board of Directors may
specify by resolution prior to any special meeting of shareholders held within
the year that such meeting shall be in lieu of the annual meeting.
Section 2. Special Meetings. Special meetings of the shareholders may
--------- ----------------
be called by the Board of Directors or by the Chairman of the Board, and shall
be called by the Corporation upon the written request (which request shall set
forth the purpose or purposes of the meeting) of the shareholders of record (as
established pursuant to Section 6(b) of Article I of these Bylaws) of
outstanding shares representing more than 50% of all the votes entitled to be
cast on any issue proposed to be considered at the proposed special meeting. In
the event such meeting is called by the Board of Directors or the Chairman of
the Board, such meeting may be held at such place, either within or without the
State of Georgia, as is stated in the call and notice thereof. If such meeting
is called at the request of shareholders as provided in this Section 2, then
such meeting shall be held at such place in the State of Georgia as is stated in
the notice thereof.
Section 3. Notice of Meetings. A written or printed notice stating the
--------- ------------------
place, day and hour of the meeting, and in case of a special meeting, the
purpose or purposes for which the meeting is called, shall be delivered or
mailed by the Secretary of the Corporation to each holder of record of stock of
the Corporation at the time entitled to vote, at his address as it appears upon
the records of the Corporation, not less than 10 nor more than 60 days prior to
1
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such meeting. If the Secretary fails to give such notice within 20 days after
the call of a meeting, the person calling or requesting such meeting, or any
person designated by them, may give such notice. Notice of such meeting may be
waived in writing by any shareholder. Notice of any adjourned meeting of the
shareholders shall not be required if the time and place to which the meeting is
adjourned are announced at the meeting at which the adjournment is taken, unless
the Board of Directors sets a new record date for such meeting in which case
notice shall be given in the manner provided in this Section 3.
Section 4. Quorum and Shareholder Vote. A quorum for action on any
--------- ---------------------------
subject matter at any annual or special meeting of shareholders shall exist when
the holders of shares entitled to vote a majority of the votes entitled to be
cast on such subject matter are represented in person or by proxy at such
meeting. If a quorum is present, the affirmative vote of such number of shares
as is required by the Georgia Business Corporation Code (as in effect at the
time the vote is taken), for approval of the subject matter being voted upon,
shall be the act of the shareholders, unless a greater vote is required by the
Articles of Incorporation or these Bylaws. If a quorum is not present, a
meeting of shareholders may be adjourned from time to time by the vote of shares
having a majority of the votes of the shares represented at such meeting, until
a quorum is present. When a quorum is present at the reconvening of any
adjourned meeting, and if the requirements of Section 3 of this Article I have
been observed, then any business may be transacted at such reconvened meeting in
the same manner and to the same extent as it might have been transacted at the
meeting as originally noticed.
Section 5. Proxies. A shareholder may vote either in person or by proxy
--------- -------
duly executed in writing by the shareholder or created pursuant to Article 5 of
the Articles of Incorporation. Unless written notice to the contrary is
delivered to the Corporation by the shareholder, a proxy for any meeting shall
be valid for any reconvention of any adjourned meeting.
Section 6. Fixing Record Date.
--------- ------------------
(a) Except as provided in paragraph (b) of this Section 6, for the
purpose of determining shareholders entitled to notice of or to vote at any
meeting of shareholders or any adjournment thereof, or entitled to receive
payment of any dividend, or in order to make a determination of shareholders for
any other proper purpose, the Board of Directors shall have the power to fix a
date, not more than 70 days prior to the date on which the particular action
requiring a determination of shareholders is to be taken, as the record date for
any such determination of shareholders. A record date for the determination of
shareholders entitled to notice of or to vote at any meeting of shareholders or
any adjournment thereof shall not be set less than 10 days prior to such
meeting; provided that the record date for the determination of shareholders
entitled to notice of or to vote at any special meeting of shareholders called
by the Corporation at the request of holders of shares pursuant to Section 2 of
Article I hereof or any adjournment thereof shall be 20 days after the
"Determination Date" (as defined in paragraph (b) of this Section 6), and
provided further that such record date shall be 70 days prior to such special
meeting. In any case where a record date is set, under any provision of this
Section 6, only shareholders of record on the said date shall be entitled to
participate in the action for which the determination of shareholders of record
2
<PAGE>
is made, whether the action is payment of a dividend, allotment of any rights or
any change or conversion or exchange of capital stock or other such action, and,
if the record date is set for the determination of shareholders entitled to
notice of or to vote at a meeting of shareholders, only such shareholders of
record shall be entitled to such notice or vote, notwithstanding any transfer of
any shares on the books of the Corporation after such record date.
(b)(i) In order that the Corporation may determine the shareholders
entitled to request a special meeting of the shareholders or a special meeting
in lieu of the annual meeting of the shareholders pursuant to Section 2 of
Article I hereof, the Board of Directors may fix a record date, which record
date shall not precede the date upon which the resolution fixing the record date
is adopted by the Board of Directors, and which date shall not be more than 10
days after the date upon which the resolution fixing the record date is adopted
by the Board of Directors. Any shareholder of record seeking to have the
shareholders request such a special meeting shall, by written notice to the
Secretary, request the Board of Directors to fix a record date. The Board of
Directors shall, within 10 business days after the date on which such a request
is received, adopt a resolution fixing the record date. If no record date has
been fixed by the Board of Directors within 10 business days after the date on
which such a request is received, the record date for determining shareholders
entitled to request such a special meeting shall be the first day on which a
signed written request setting forth the request to fix a record date is
delivered to the Corporation by delivery to its principal place of business, or
any officer or agent of the Corporation having custody of the books in which
proceedings of meetings of shareholders are recorded.
(ii) Every written request for a special meeting shall bear the date of
signature of each shareholder who signs the request and no such request shall be
effective to request such a meeting unless, within 70 days after the record date
established in accordance with paragraph (b)(i) of this Section, written
requests signed by a sufficient number of record holders as of such record date
to request a special meeting in accordance with Section 2 of Article I hereof
are delivered to the Corporation in the manner prescribed in paragraph (b)(i) of
this Section.
(iii) In the event of the delivery, in the manner provided by this
Section, to the Corporation of the requisite written request or requests for a
special meeting and/or any related revocation or revocations, the Corporation
shall engage nationally recognized independent inspectors of elections for the
purpose of promptly performing a ministerial review of the validity of the
requests and revocations. For the purpose of permitting a prompt ministerial
review by the independent inspectors, no request by shareholders for a special
meeting shall be effective until the earlier of (i) five business days following
delivery to the Corporation of requests signed by the holders of record (on the
record date established in paragraph (b)(i) of this Section) of the requisite
minimum number of shares that would be necessary to request such a meeting under
Section 2 of Article I hereof, or (ii) such date as the independent inspectors
certify to the Corporation that the requests delivered to the Corporation in
accordance with this Article represent at least the minimum number of shares
that would be necessary to request such meeting (the earlier of such dates being
3
<PAGE>
herein referred to as the "Determination Date"). Nothing contained in this
paragraph shall in any way be construed to suggest or imply that the Board of
Directors or any shareholder shall not be entitled to contest the validity of
any request or revocation thereof, whether during or after such five business
day period, or to take any other action (including, without limitation, the
commencement, prosecution or defense of any litigation with respect thereto).
(iv) Unless the independent inspectors shall deliver, on or before the
Determination Date, a certified report to the Corporation stating that the valid
requests for a special meeting submitted pursuant to paragraph (iii) above
represent less than the requisite minimum number of shares that would be
necessary to request a special meeting under Section 2 of Article I hereof, the
Board of Directors shall, within five business days after the Determination
Date, adopt a resolution calling a special meeting of the shareholders and
fixing a record date for such meeting, in accordance with Section 6(a) of
Article I of these Bylaws.
Section 7. Notice of Shareholder Business. At an annual meeting of
--------- ------------------------------
the shareholders, only such business shall be conducted as shall have been
brought before the meeting (a) by or at the direction of the Board of Directors
or (b) by any shareholder of the Corporation who complies with the notice
procedures set forth in this Section 7 and only to the extent that such business
is appropriate for shareholder action under the provisions of the Georgia
Business Corporation Code. For business to be properly brought before an annual
meeting by a shareholder, the shareholder must have given timely notice thereof
in writing to the Secretary of the Corporation. To be timely, a shareholder's
notice must be delivered to or mailed and received at the principal executive
offices of the Corporation not later than the close of business on the 7th day
following the day on which notice of the date of the annual meeting was mailed
or delivered to such shareholder. A shareholder's notice to the Secretary shall
set forth as to each matter the shareholder proposes to bring before the annual
meeting (a) a brief description of the business desired to be brought before the
annual meeting and the reasons for conducting such business at the annual
meeting, (b) the name and address, as they appear on the Corporation's books, of
the shareholder proposing such business, (c) the class and number of shares of
stock of the Corporation which are beneficially owned by the shareholder, and
(d) any material interest of the shareholder in such business. Notwithstanding
anything in the Bylaws to the contrary, no business shall be conducted at an
annual meeting except in accordance with the procedures set forth in this
Section 7. At an annual meeting, the Chairman shall, if the facts warrant,
determine and declare to the meeting that business was not properly brought
before the meeting in accordance with the provisions of this Section 7, and if
he should so determine, he shall so declare to the meeting and any such business
not properly brought before the meeting shall not be transacted.
Section 8. Notice of Shareholder Nominees. Except for Directors who
--------- ------------------------------
are elected by Directors pursuant to the provisions of Section 9 of Article II
of these Bylaws, only persons who are nominated in accordance with the
procedures set forth in this Section 8 shall be eligible for election as
Directors. Nominations of persons for election to the Board of Directors of the
Corporation may be made at a meeting of shareholders (a) by or at the direction
of the Board of Directors or (b) by any shareholder of the Corporation entitled
4
<PAGE>
to vote for the election of Directors at the meeting who complies with the
notice procedures set forth in this Section 8. Such nominations, other than
those made by or at the direction of the Board of Directors, shall be made
pursuant to timely notice in writing to the Secretary of the Corporation. To be
timely, a shareholder's notice must be delivered to or mailed and received at
the principal executive offices of the Corporation not later than the close of
business on the 7th day following the day on which notice of the date of the
meeting was mailed or delivered to such shareholder. Such shareholder's notice
shall set forth (a) as to each person whom the shareholder proposes to nominate
for election or re-election as a Director, all information relating to such
person that is required to be disclosed in solicitations of proxies for election
of Directors, or is otherwise required, in each case pursuant to Regulation 14A
under the Securities Exchange Act of 1934, as amended; and (b) as to the
shareholder giving the notice (i) the name and address, as they appear on the
Corporation's books, of such shareholder and (ii) the class and number of shares
of stock of the Corporation which are beneficially owned by such shareholder.
No person shall be eligible for election as a Director of the Corporation unless
nominated in accordance with the procedures set forth in the Bylaws. The
Chairman shall, if the facts warrant, determine and declare to the meeting that
a nomination was not made in accordance with the procedures prescribed by the
Bylaws, and if he should so determine, he shall so declare to the meeting and
the defective nomination shall be disregarded.
ARTICLE II
DIRECTORS
---------
Section 1. Powers of Directors. The Board of Directors shall manage
--------- -------------------
the business and affairs of the Corporation and, subject to any restrictions
imposed by law, by the Articles of Incorporation, or by these Bylaws, may
exercise all the powers of the Corporation.
Section 2. Number and Term of Directors. The Board of Directors
--------- ----------------------------
shall consist of eleven natural persons divided into classes and with terms as
provided in the Articles of Incorporation. No decrease in the number of
Directors shall shorten the term of an incumbent Director.
Section 3. Meetings of the Directors. The Board of Directors shall
--------- -------------------------
meet each year immediately following the annual meeting of shareholders, and the
Board may by resolution provide for the time and place of other regular
meetings. Special meetings of the Directors may be called by the Chairman of
the Board or by any two of the Directors.
Section 4. Notice of Meetings. Notice of each meeting of the Directors
--------- ------------------
shall be given by the Secretary by mailing the same at least ten days before the
meeting or by telephone, telegraph or cablegram or in person at least five days
before the meeting, to each Director, except that no notice need be given of
regular meetings fixed by the resolution of the Board or of the meeting of the
Board held at the place of and immediately following the annual meeting of the
5
<PAGE>
shareholders. Any Director may waive notice, either before or after the meeting,
and shall be deemed to have waived notice if he is present at the meeting.
Section 5. Action of Directors Without a Meeting. Any action required
--------- -------------------------------------
by law to be taken at a meeting of the Board of Directors, or any action which
may be taken at a meeting of the Board of Directors, or of any committee
thereof, may be taken without a meeting if written consent, setting forth the
action so taken, shall be signed by all the Directors, or all the members of the
committee, as the case may be, and be filed with the minutes of the proceedings
of the Board or the committee. Such consent shall have the same force and effect
as a unanimous vote of the Board or the committee, as the case may be.
Section 6. Committees. The Board of Directors may, in its discretion,
--------- ----------
appoint committees, each consisting of one or more Directors, which shall have
and may exercise such delegated powers as shall be conferred on or authorized by
the resolutions appointing them, except that no such committee may: (1) approve
or propose to shareholders action that the Georgia Business Corporation Code
requires to be approved by shareholders, (2) fill vacancies on the Board of
Directors or any of its committees, (3) amend the Articles of Incorporation of
the Corporation pursuant to Section 14-2-1002 of the Georgia Business
Corporation Code, (4) adopt, amend or repeal these Bylaws, or (5) approve a plan
of merger not requiring shareholder approval. A majority of any such committee
may determine its action, fix the time and place of its meetings, and determine
its rules of procedure. Each committee shall keep minutes of its proceedings and
actions and shall report regularly to the Board of Directors. The Board of
Directors shall have power at any time to fill vacancies in, change the
membership of, or discharge any such committee.
Section 7. Compensation. The Board of Directors shall have the
--------- ------------
authority to determine from time to time the amount of compensation that shall
be paid to its members for attendance at meetings of, or service on, the Board
of Directors of any committee of the Board, except that no such compensation
shall be paid to Directors who are also employees of the Corporation. The Board
of Directors also shall have the power to reimburse Directors for reasonable
expenses of attendance at Directors' meetings and committee meetings.
Section 8. Removal. Subject to the rights of the holders of any series
--------- -------
of Preferred Stock then outstanding, any or all Directors may be removed from
office at any time, but only for cause, and only by the vote of a majority of
the votes entitled to be cast.
Section 9. Vacancies. Subject to the rights of the holders of any
--------- ---------
series of Preferred Stock then outstanding to fill director vacancies, vacancies
on the Board of Directors (including vacancies resulting from retirement,
resignation, removal from office or death) shall be filled by the Board of
Directors.
Section 10. Telephone Conference Meetings. Unless the Articles of
---------- -----------------------------
Incorporation otherwise provide, members of the Board of Directors, or any
committee designated by the Board of Directors, may participate in a meeting of
the Board or committee by means of telephone conference or similar
communications equipment by means of which all persons participating in the
6
<PAGE>
meeting can hear each other, and participation in a meeting pursuant to this
Section 10 shall constitute presence in person at such meeting.
ARTICLE III
OFFICERS
--------
Section 1. Officers. The officers of the Corporation shall consist
--------- --------
of a Chairman of the Board, a Vice Chairman of the Board, a President, one or
more Managing Directors, one or more Vice-Presidents, a Secretary and a
Treasurer, and such other officers or assistant officers as may be elected by
the Board of Directors. Any two offices may be held by the same person. The
Board may designate a Vice-President as an Executive Vice-President or a Senior
Vice President, and may designate the order in which the Vice-Presidents may
act.
Section 2. Chairman of the Board. The Chairman of the Board shall be
--------- ---------------------
the chief executive officer of the Corporation and shall, under the direction of
the Board of Directors, have responsibility for the general direction of the
business, policies and affairs of the Corporation. He shall preside at all
meetings of the shareholders and all meetings of the Board of Directors and
shall have such other duties as the Board of Directors shall from time to time
prescribe.
Section 3. Vice Chairman of the Board. The Vice Chairman of the Board
--------- --------------------------
shall be the chief investment officer of the Corporation and shall, under the
direction of the chief executive officer, supervise the investment activities of
the Corporation. He shall have such further powers and duties as from time to
time may be conferred on him by the Board of Directors or the chief executive
officer. In the absence of the Chairman of the Board, he shall preside at all
meetings of the shareholders and the Board of Directors.
Section 4. President. The President shall be the chief operating
--------- ---------
officer of the Corporation. He shall, under the direction of the chief
executive officer, supervise the management of the day-to-day business of the
Corporation. He shall have such further powers and duties as from time to time
may be conferred on him by the Board of Directors or the chief executive
officer. In the absence of the Chairman of the Board and the Vice Chairman of
the Board, he shall preside at all meetings of the shareholders and the Board of
Directors.
Section 5. Managing Director. The Managing Director shall act in the
--------- -----------------
case of the absence or disability of the Chairman of the Board, the Vice
Chairman of the Board and the President. If there is more than one Managing
Director, such Managing Directors shall act in the order of precedence as set
out by the Board of Directors.
Section 6. Vice-President. The Vice-President shall act in the case of
--------- --------------
the absence or disability of the Chairman of the Board, the Vice Chairman of the
Board, the Managing Director and the President. If there is more than one Vice-
7
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President, such Vice-Presidents shall act in the order of precedence, as set out
by the Board of Directors.
Section 7. Treasurer. The Treasurer shall be responsible for the
--------- ---------
maintenance of proper financial books and records of the Corporation.
Section 8. Secretary. The Secretary shall keep the minutes of the
--------- ---------
meetings of the shareholders and the Directors and shall have custody of and
attest the seal of the Corporation.
Section 9. Other Duties and Authorities. Each officer, employee and
--------- ----------------------------
agent shall have such other duties and authorities as may be conferred on them
by the Board of Directors.
Section 10. Removal. Any officer may be removed at any time by the
---------- -------
Board of Directors, and such vacancy may be filled by the Board of Directors. A
contract of employment for a definite term shall not prevent the removal of any
officer, but this provision shall not prevent the making of a contract of
employment with any officer and shall have no effect upon any cause of action
which any officer may have as a result of removal in breach of a contract of
employment or upon the enforceability of any other provision of a contract of
employment.
Section 11. Compensation. The salaries of the officers shall be fixed
--------- -------------
from time to time by the Board of Directors, subject to the provisions of any
applicable contracts of employment. No officer shall be prevented from receiving
such salary by reason of the fact that he is also a Director of the Corporation.
ARTICLE IV
DEPOSITORIES, SIGNATURE AND SEAL
--------------------------------
Section 1. Depositories. All funds of the Corporation shall be
--------- ------------
deposited in the name of the Corporation in such depository or depositories as
the Board may designate and shall be drawn out on checks, drafts or other orders
signed by such officer, officers, agent or agents as the Board may from time to
time authorize.
Section 2. Contracts. All contracts and other instruments shall be
--------- ---------
signed on behalf of the Corporation by the Chairman of the Board, the Vice
Chairman of the Board, the President, any Vice-President or by such other
officer, officers, agent or agents, as the Chairman of the Board, the Vice
Chairman of the Board, or the President designates from time to time or as the
Board from time to time may by resolution provide.
8
<PAGE>
Section 3. Seal. The seal of the Corporation shall be as follows:
--------- ----
The seal may be manually affixed to any document or may be lithographed
or otherwise printed on any document with the same force and effect as if it had
been affixed manually. The signature of the Secretary or Assistant Secretary
shall attest the seal and may be a facsimile if and to the extent permitted by
law.
ARTICLE V
STOCK TRANSFERS
---------------
Section 1. Form and Execution of Certificates. The certificates of
--------- ----------------------------------
shares of capital stock of the Corporation shall be in such form as may be
approved by the Board of Directors and shall be signed by the Chairman of the
Board, the Vice Chairman of the Board, the President or a Vice-President and by
the Secretary or any Assistant Secretary or the Treasurer or any Assistant
Treasurer, provided that any such certificate may be signed by the facsimile
signature of any of such officers imprinted thereon if the same is countersigned
by a transfer agent of the Corporation, and provided further that certificates
bearing the facsimile of the signature of such officers imprinted thereon shall
be valid in all respects as if such person or persons were still in office, even
though such officer or officers shall have died or otherwise ceased to be
officers.
Section 2. Transfers of Shares. Shares of stock in the Corporation
--------- -------------------
shall be transferable only on the books of the Corporation by proper transfer
signed by the holder of record thereof or by a person duly authorized to sign
for such holder of record. The Corporation or its transfer agent or agents shall
be authorized to refuse any transfer unless and until it is furnished such
evidence as it may reasonably require showing that the requested transfer is
proper.
Section 3. Lost, Destroyed or Stolen Certificates. Where the holder of
--------- --------------------------------------
record of a share or shares of stock of the Corporation claims that the
certificate representing said share has been lost, destroyed or wrongfully
taken, the Board shall by resolution provide for the issuance of a certificate
to replace the original if the holder of record so requests before the
9
<PAGE>
Corporation has notice that the certificate has been acquired by a bona fide
purchaser, files with the Corporation a sufficient indemnity bond, and furnishes
evidence of such loss, destruction or wrongful taking satisfactory to the
Corporation, in the reasonable exercise of its discretion. The Board may
authorize such officer or agent as it may designate to determine the sufficiency
of such an indemnity bond and to determine reasonably the sufficiency of the
evidence of loss, destruction or wrongful taking.
Section 4. Transfer Agent and Registrar. The Board may (but shall not be
--------- ----------------------------
required to) appoint a transfer agent or agents and a registrar or registrars to
transfers, and may require that all stock certificates bear the signature of
such transfer agent or of such transfer agent and registrar.
ARTICLE VI
INDEMNIFICATION
---------------
Section 1. Mandatory Indemnification. The Corporation shall indemnify
--------- -------------------------
to the fullest extent permitted by the Georgia Business Corporation Code, and to
the extent that applicable law from time to time in effect shall permit
indemnification that is broader than provided in these Bylaws, then to the
maximum extent authorized by law, any individual made a party to a proceeding
(as defined in the Georgia Business Corporation Code) because he is or was a
director or officer, against liability (as defined in the Georgia Business
Corporation Code), incurred in the proceeding.
Section 2. Permissive Indemnification. The Corporation shall have the
--------- --------------------------
power to indemnify to the fullest extent permitted by the Georgia Business
Corporation Code, any individual made a party to a proceeding (as defined in the
Georgia Business Corporation Code) because he is or was an employee or agent of
the Company, against liability (as defined in the Georgia Business Corporation
Code), incurred in the proceeding.
Section 3. Advances for Expenses. The Corporation shall pay for or
--------- ---------------------
reimburse the reasonable expenses incurred by a director or officer who is a
party to a proceeding, and shall have the authority to pay for or reimburse the
reasonable expenses of an employee or agent of the Company who is a party to a
proceeding, in each case in advance of the final disposition of a proceeding if:
(a) Such person furnishes the Corporation a written affirmation
of his good faith belief that he has met the standard of conduct
set forth in Section 1 or Section 2 above, as applicable; and
(b) Such person furnishes the Corporation a written
undertaking, executed personally on his behalf to repay any
advances if it is ultimately determined that he is not entitled
to indemnification.
10
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The written undertaking required by paragraph (b) above must be an
unlimited general obligation of such person but need not be secured and may be
accepted without reference to financial ability to make repayment.
Section 4. Indemnification Not Exclusive. The right to indemnification
--------- -----------------------------
and the payment of expenses incurred in defending a proceeding in advance of its
final disposition conferred in this Article VI shall not be exclusive of any
other right which any person may have or hereafter acquire under any statute,
provision of the Articles of Incorporation, provision of these Bylaws,
agreement, vote of shareholders or disinterested directors or otherwise.
Section 5. Amendment or Repeal. Any repeal or modification of the
--------- -------------------
foregoing provisions of this Article VI shall not adversely affect any right or
protection hereunder of any person in respect of any act or omission occurring
prior to the time of such repeal or modification.
ARTICLE VII
AMENDMENT OF BYLAWS
-------------------
Section 1. Amendment. These Bylaws may be altered, amended, repealed or
--------- ---------
new Bylaws adopted by the Board of Directors by the affirmative vote of a
majority of all directors then holding office, but any bylaws adopted by the
Board of Directors may be altered, amended, repealed, or any new bylaws adopted,
by the shareholders at an annual or special meeting of shareholders, when notice
of any such proposed alteration, amendment, repeal or addition shall have been
given in the notice of such meeting. The shareholders may prescribe that any
bylaw or bylaws adopted by them shall not be altered, amended or repealed by the
Board of Directors. Action by the shareholders with respect to these Bylaws
shall be taken by an affirmative vote of a majority of all shares outstanding
and entitled to vote generally in the election of directors, voting as a single
voting group.
11
<PAGE>
================
REGISTRATION RIGHTS AND LOCK-UP AGREEMENT
Dated as of December 31, 1996
by and among
WEEKS CORPORATION
and
HAROLD S. LICHTIN, NOEL A. LICHTIN,
MARIE A. ROBERTSON, AMY R. EHRMAN,
ROLAND G. ROBERTSON AND PERIMETER PARK
WEST ASSOCIATES LIMITED PARTNERSHIP
================
<PAGE>
REGISTRATION RIGHTS AND LOCK-UP AGREEMENT
THIS REGISTRATION RIGHTS AND LOCK-UP AGREEMENT (this "Agreement") is made
and entered into as of December 31, 1996, by and among WEEKS CORPORATION, a
Georgia corporation (the "Company"), HAROLD S. LICHTIN, an individual resident
of North Carolina, NOEL A. LICHTIN, an individual resident of North Carolina,
MARIE A. ROBERTSON, an individual resident of Texas, AMY R. EHRMAN, an
individual resident of Texas, ROLAND G. ROBERTSON, an individual resident of
Texas, and PERIMETER PARK WEST ASSOCIATES LIMITED PARTNERSHIP, a North Carolina
limited partnership (Harold S. Lichtin, Noel A. Lichtin, Marie A. Roberston, Amy
R. Ehrman, Roland G. Robertson and Perimeter Park West Associates Limited
Partnership are collectively referred to hereafter as the "Lichtin Holders").
WHEREAS, this Agreement is made pursuant to (i) the Contribution Agreement
for Completed Properties by and between Weeks and the Contributors (as therein
defined) dated as of even date herewith; (ii) the Contribution Agreement for
Development Properties by and between Weeks and the Contributors (as therein
defined) dated as of even date herewith; (iii) the Contribution Agreement for
the Northern Telecom Properties by and between Weeks and the Contributors (as
therein defined) dated as of even date herewith; (iv) the Contribution Agreement
for the Perimeter Park West, Metro Center and Perimeter Park Land by and between
Weeks and the Contributors (as therein defined) dated as of even date herewith;
(v) the Contribution Agreement for the Regency Forest and Woodlake Land by and
between Weeks and the Contributors (as therein defined) dated as of even date
herewith, and (vi) the Agreement and Plan of Merger for Lichtin Operating
Business by and among Lichtin Properties, Inc., Harold S. Lichtin and Weeks
Corporation dated as of even date herewith; (collectively, the documents
referred to in clauses (i), (ii), (iii), (iv), (v) and (vi) above are hereafter
referred to as the "Contribution Agreements");
WHEREAS, on the date hereof each of the Lichtin Holders is or will become
the owner of Units (as defined below) in Weeks Realty, L.P., a Georgia limited
partnership (the "Operating Partnership") or Shares (as defined below) in the
Company, in connection with the transactions described in the Contribution
Agreements;
WHEREAS, in order to induce Weeks to enter into the transactions described
in the Contribution Agreements, each of the Lichtin Holders has agreed to the
Lichtin Holders Lock-up (as defined below) set forth in Section 2(a) hereof; and
WHEREAS, in order to induce the Lichtin Holders to enter into the
transactions described in the Contribution Agreements, the Company has agreed,
with respect to the Shares and Units issued on, prior to, or as of June 30,
1998, to provide the Lichtin Holders with the registration rights set forth in
Sections 3, 5 and 6 hereof, as applicable;
<PAGE>
NOW, THEREFORE, the parties hereto, in consideration of the foregoing, the
mutual covenants and agreements hereinafter set forth, and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, agree as follows:
1. Definitions.
-----------
As used in this Agreement, the following capitalized defined terms shall
have the following meanings:
"Common Stock" shall mean the Common Stock, par value $.01 per share, of
------------
the Company.
"Company" shall have the meaning set forth in the Preamble and also shall
-------
include the Company's successors.
"Contribution Agreements" shall have the meaning set forth in the Preamble.
-----------------------
"Control" shall mean the ability, whether by the direct or indirect
-------
ownership of shares or other equity interests, by contract or otherwise, to
select a majority of the directors of a corporation, to select the managing
partner of a partnership, to select the manager of a limited liability company
or otherwise to select, or have the power to remove and then select, a majority
of those persons exercising governing authority over an Entity. In the case of
a limited partnership, the sole general partner, each of the general partners
that has equal management control and authority, or the designated managing
general partner or managing general partners thereof shall be deemed to have
control of such partnership. In the case of a trust, any trustee thereof or any
Person having the right to select any such trustee shall be deemed to have
control of such trust.
"Current Market Price" of each share of Common Stock shall mean (i) the
--------------------
average of the closing prices of the Common Stock for the five-trading day
period immediately preceding the day in question as reported by The Wall Street
---------------
Journal under the New York Stock Exchange Composite Transactions quotation
- -------
system (or under any successor quotation system) or, if the Common Stock is no
longer traded on the New York Stock Exchange under the quotation system under
which such closing prices are reported or, if The Wall Street Journal no longer
-----------------------
reports such closing prices, such closing prices as reported by a newspaper or
trade journal selected by the Company or (ii) if no such closing prices are
available on such dates, the fair market value as determined in good faith by
the Board of Directors of the Company.
"Demand Prospectus" shall mean the prospectus included in the Demand
-----------------
Registration Statement, including any preliminary prospectus, and any amendment
or supplement thereto, including any supplement relating to the terms of the
offering of any portion of the Demand Registrable Securities covered by the
Demand Registration Statement, and in each case including all material
incorporated by reference therein.
-2-
<PAGE>
"Demand Registration" shall mean a registration required to be effected
-------------------
pursuant to Section 5 hereof.
"Demand Registrable Securities" shall mean the Shares held by the Lichtin
-----------------------------
Holders (and the Shares issuable upon conversion of the Units), excluding (i)
Shares that have been disposed of under the Demand Registration Statement or any
other effective registration statement, (ii) Shares sold or otherwise
transferred pursuant to Rule 144 under the Securities Act, and (iii) Shares held
by the Lichtin Holders if all of such Shares are eligible for sale pursuant to
Rule 144 under the Securities Act and could be sold in one transaction in
accordance with the volume limitations contained in Rule 144(e)(1)(i) under the
Securities Act.
"Demand Registration Expenses" shall mean any and all expenses incurred by
----------------------------
the Company in connection with Demand Registrations and Piggyback Registrations,
including, without limitation: (i) all SEC, stock exchange and National
Association of Securities Dealers, Inc. ("NASD") registration and filing fees,
(ii) all fees and expenses incurred in connection with compliance with state
securities or "blue sky" laws (including reasonable fees and disbursements of
counsel in connection with qualification of any of the Demand Registrable
Securities under any state securities or blue sky laws and the preparation of a
blue sky memorandum) and compliance with the rules of the NASD, (iii) all
expenses of any Persons in preparing or assisting in preparing, word processing,
printing and distributing the Demand Registration Statement, any Demand
Prospectus, certificates and other documents relating to the performance of and
compliance with this Agreement, (iv) all fees and expenses incurred in
connection with the listing, if any, of any of the Demand Registrable Securities
on any securities exchange or exchanges pursuant to Section 8(j) hereof, (v)
the fees and disbursements of counsel for the Company and of the independent
public accountants of the Company, including the expenses of any special audits
or "cold comfort" letters required by or incident to such performance and
compliance, and (vi) all other costs and expenses normally associated with the
issuance and sale of newly issued public securities other than "Selling
Expenses."
"Demand Registration Request" shall have the meaning set forth in Section
---------------------------
5(a) hereof.
"Demand Registrations" shall have the meaning set forth in Section 5(a)
--------------------
hereof.
"Demand Registration Statement" shall have the meaning set forth in Section
-----------------------------
8(a) hereof.
"Dispose of" shall have the meaning set forth in Section 2(a) hereof.
----------
"Entity" shall mean any general partnership, limited partnership,
------
corporation, limited liability company, joint venture, trust, business trust,
cooperative or association.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended
------------
from time to time.
-3-
<PAGE>
"Lichtin Holders" shall have the meaning set forth in the Preamble.
---------------
Lichtin Holder shall mean each Lichtin Holder.
"Lichtin Holders Lock-up" shall have the meaning set forth in Section 2(a)
-----------------------
hereof.
"Lichtin Holders Lock-up Period" shall have the meaning set forth in
------------------------------
Section 2(a) hereof.
"Maximum Number" shall having the meaning set forth in Section 5(e) hereof.
--------------
"Operating Partnership" shall have the meaning set forth in the Preamble
---------------------
and also shall include the Operating Partnership's successors and assigns.
"Partnership Agreement" shall mean the Second Amended and Restated
---------------------
Agreement of Limited Partnership of the Operating Partnership, as amended.
"Permitted Private Transfer" shall mean the transfer of Units or Shares
--------------------------
pursuant to a private placement permitted under Section 4(2) of the Securities
Act, or regulations promulgated thereunder, or a transfer which complies with
Rule 144 promulgated under the Securities Act.
"Person" shall mean any individual or Entity.
------
"Piggyback Registration" shall have the meaning set forth in Section 6(a)
----------------------
hereof.
"Piggyback Registration Request" shall have the meaning set forth in
------------------------------
Section 6(a) hereof.
"Registration Expenses" shall have the meaning set forth in Section 9
---------------------
hereof.
"SEC" shall mean the Securities and Exchange Commission.
---
"Securities Act" shall mean the Securities Act of 1933, as amended from
--------------
time to time.
"Selling Expenses" shall mean all underwriting discounts and selling
----------------
commissions and transfer taxes applicable to the sale of Demand Registrable
Securities or Shelf Registrable Securities, as applicable, and disbursements of
underwriters.
"Shares" shall mean (i) any Common Stock issued to the Lichtin Holders on
------
the date hereof, (ii) any Common Stock issued to the Lichtin Holders in private
placements subsequent to the date hereof but on or prior to June 30, 1998, and
(iii) any Common Stock issued to the Lichtin Holders upon redemption of those
Units which were issued to the Lichtin Holders on, prior to, or as of June 30,
1998.
"Shelf Prospectus" shall mean the prospectus included in the Shelf
----------------
Registration Statement, including any preliminary prospectus, and any amendment
or supplement thereto, including any supplement relating to the terms of the
-4-
<PAGE>
offering of any portion of the Shelf Registrable Securities covered by the Shelf
Registration Statement, and in each case including all material incorporated by
reference therein.
"Shelf Registration" shall mean a registration required to be effected
------------------
pursuant to Section 3 hereof.
"Shelf Registrable Securities" shall mean the Shares held by the Lichtin
----------------------------
Holders, excluding (i) Shares that have been disposed of under the Shelf
Registration Statement or any other effective registration statement, (ii)
Shares sold or otherwise transferred pursuant to Rule 144 under the Securities
Act, and (iii) Shares held by the Lichtin Holders if all of such Shares are
eligible for sale pursuant to Rule 144 under the Securities Act and could be
sold in one transaction in accordance with the volume limitations contained in
Rule 144(e)(1)(i) under the Securities Act.
"Shelf Registration Expenses" shall mean any and all expenses incident to
---------------------------
performance of or compliance with this Agreement, including, without limitation:
(i) all SEC, stock exchange and NASD registration and filing fees, (ii) all fees
and expenses incurred in connection with compliance with state securities or
"blue sky" laws (including reasonable fees and disbursements of counsel in
connection with qualification of any of the Shelf Registrable Securities under
any state securities or blue sky laws and the preparation of a blue sky
memorandum) and compliance with the rules of the NASD, (iii) all expenses of any
Persons in preparing or assisting in preparing, word processing, printing and
distributing the Shelf Registration Statement, any Shelf Prospectus,
certificates and other documents relating to the performance of and compliance
with this Agreement, (iv) all fees and expenses incurred in connection with the
listing, if any, of any of the Shelf Registrable Securities on any securities
exchange or exchanges pursuant to Section 4(l) hereof, (v) the fees and
disbursements of counsel for the Company and of the independent public
accountants of the Company, including the expenses of any special audits or
"cold comfort" letters required by or incident to such performance and
compliance, and (vi) all other costs and expenses normally associated with the
issuance and sale of newly issued public securities other than Selling Expenses.
"Shelf Registration Notice" shall have the meaning set forth in Section
-------------------------
4(b) hereof.
"Shelf Registration Statement" shall mean a registration statement of the
----------------------------
Company (and any other entity required to be a registrant with respect to such
registration statement pursuant to the requirements of the Securities Act) that
covers all of the Shelf Registrable Securities to be offered on a delayed or
continuous basis pursuant to Rule 415 under the Securities Act, or any similar
rule that may be adopted by the SEC, and all amendments (including post-
effective amendments) to such registration statement, and all exhibits thereto
and materials incorporated by reference therein.
"Units" shall mean (i) the limited partnership interests of the Operating
-----
Partnership issued to the Lichtin Holders on the date hereof, and (ii) the
limited partnership interests of the Operating Partnership issued to the Lichtin
-5-
<PAGE>
Holders in private placements subsequent to the date hereof but on or prior to
June 30, 1998, which such interests in clauses (i) and (ii) are redeemable for
Common Stock, or at the Operating Partnership's option, cash.
2. Lock-up Agreement.
-----------------
(a) Lock-Up Period for the Lichtin Holders. Each of the Lichtin Holders
--------------------------------------
hereby agrees that, except as set forth in Section 2(b) below, (i) with respect
to all Units and Shares issued (except for those Units described in clause (ii)
below), from the date hereof until the later of (x) one year after the issuance
of the last Units to the Lichtin Holders which the Lichtin Holders become
entitled to receive with respect to the acquisition by the Operating Partnership
of the Development Properties or the Northern Telecom Properties (as described
in the applicable Contribution Agreement) or (y) the third anniversary of the
date hereof, without the prior written consent of the Company, such Lichtin
Holder will not offer, sell, contract to sell, distribute or otherwise dispose
of (collectively, "Dispose of"), directly or indirectly, to any Person any such
Units or Shares (including Shares issued in exchange for Units) and (ii) with
respect to the Units issued in connection the Contribution Agreement for the
Perimeter Park West, Metro Center and Perimeter Park Land from the date of the
closing of any such contribution until the later of (x) one year following the
date of such closing or (y) the expiration of the last lock-up period described
in clause (i) above, without the prior written consent of the Company, such
Lichtin Holder will not Dispose of directly or indirectly, to any Person any
such Units or Shares (including Shares which are issued in exchange for such
Units) (collectively, the lock-ups described in clauses (i) and (ii) are
referred to as the "Lichtin Holders Lock-up" and the lock-up periods described
in clauses (i) and (ii) are referred to as the "Lichtin Holders Lock-up Period")
(b) Exceptions. The following transfers of Shares or Units shall not be
----------
subject to the Lichtin Holders Lock-up set forth in Section 2(a):
(i) subject to applicable restrictions contained in the Partnership
Agreement, a Lichtin Holder may Dispose of Shares or Units pursuant to a
pledge, grant of security interest or other encumbrance effected in a bona
fide transaction with an unrelated and unaffiliated pledgee;
(ii) subject to applicable exchange restrictions contained in the
Partnership Agreement, a Lichtin Holder may exchange its Units for shares
of Common Stock; and
(iii) subject to applicable restrictions contained in the Partnership
Agreement, a Lichtin Holder may Dispose of its Units or Shares pursuant
to a Permitted Private Transfer;
provided, however, that in the case of any transfer of Shares or Units
-------- -------
pursuant to clauses (i) and (iii), the transferee or transferees shall
each be an "accredited investor" within the meaning of Rule 501(a) of
Regulation D under the Securities Act.
-6-
<PAGE>
In the event a Lichtin Holder Disposes of Shares or Units pursuant to this
Section 2(b), (i) such Shares or Units shall remain subject to this Agreement
and, as a condition of the validity of such disposition, the transferee (and any
pledgee who acquires Shares or Units upon foreclosure or any transferee thereof)
shall be required to execute and deliver a counterpart of this Agreement; and
(ii) if the transferee is an entity in which the transferring Lichtin Holder
owns an interest, then the interest of such Lichtin Holder in such transferee
shall be subject to the Lichtin Holders Lock-up. Thereafter, such transferee
shall be deemed to be a Lichtin Holder for purposes of this Agreement.
3. Shelf Registration Under the Securities Act for the Benefit of the
------------------------------------------------------------------
Lichtin Holders.
---------------
(a) Filing of Shelf Registration Statement. Subject to Section 3(d), the
--------------------------------------
Company shall cause to be filed on the first business day following the
expiration of the last Lichtin Holders Lock-Up Period that is applicable to
Units or Shares which were issued on, prior to, or as of June 30, 1998, or as
soon as practicable thereafter, the Shelf Registration Statement providing for
the sale by the Lichtin Holders of all of the Shelf Registrable Securities in
accordance with the terms hereof and will use its reasonable and diligent
efforts to cause such Shelf Registration Statement to be declared effective by
the SEC as soon as practicable thereafter. The Company agrees to use its
reasonable and diligent efforts to keep the Shelf Registration Statement with
respect to the Shelf Registrable Securities continuously effective so long as
the Lichtin Holders hold Shelf Registrable Securities or Units which are
convertible into Shares. Subject to Section 4(b) and Section 4(i), the Company
further agrees to amend the Shelf Registration Statement if and as required by
the rules, regulations or instructions applicable to the registration form used
by the Company for such Shelf Registration Statement or by the Securities Act or
any rules and regulations thereunder; provided, however, that the Company shall
-------- -------
not be deemed to have used its reasonable and diligent efforts to keep the Shelf
Registration Statement effective during the applicable period if it voluntarily
takes any action that would result in the Lichtin Holders not being able to sell
Shelf Registrable Securities covered thereby during that period, unless such
action is required under applicable law or the Company has filed a post-
effective amendment (other than one which removes Shelf Registrable Securities
from effective registration under the Securities Act) to the Shelf Registration
Statement and the SEC has not declared it effective or except as otherwise
permitted by the last three sentences of Section 4(b).
(b) Expenses. The Company shall pay all Shelf Registration Expenses in
--------
connection with the registration pursuant to Section 3(a). Each Lichtin Holder
shall pay all Selling Expenses and the fees and disbursements of counsel
representing such Lichtin Holder, if any, relating to the sale or disposition of
such Shelf Registrable Securities pursuant to the Shelf Registration Statement.
(c) Inclusion in Shelf Registration Statement. If any Lichtin Holder does
-----------------------------------------
not provide the information reasonably requested by the Company in connection
with the Shelf Registration Statement as promptly as practicable after receipt
of such request, but in no event later than ten (10) days thereafter, it shall
not be entitled to have its Shelf Registrable Securities included in the Shelf
Registration Statement.
-7-
<PAGE>
(d) Inability to File or Maintain Shelf Registration Statement. The
----------------------------------------------------------
Company shall be obligated to comply with the provisions of Sections 3 hereof
only if the Company is permitted, under the Securities Act and the rules and
regulations of the SEC then applicable, to file and maintain the Shelf
Registration Statement on a Form S-3 registration statement, or on any other
similar form that permits the registration of the Shelf Registration Securities
and the incorporation by reference of subsequently filed documents under the
Exchange Act. In the event that the Company is unable to comply with the
provisions of Section 3 hereof in accordance with the foregoing sentence, the
Company shall become obligated to provide the Lichtin Holders with those demand
and piggyback registration rights provided for in Sections 5 and 6 hereof.
4. Shelf Registration Procedures.
-----------------------------
In connection with the obligations of the Company with respect to the Shelf
Registration Statement contemplated by Section 3 hereof, the Company shall:
(a) prepare and file with the SEC, within the time period set forth in
Section 3 hereof, the Shelf Registration Statement, which Shelf
Registration Statement (i) shall be available for the sale of the Shelf
Registrable Securities in accordance with the intended method or methods of
distribution by the Lichtin Holders covered thereby and (ii) shall comply
as to form in all material respects with the requirements of the applicable
form and include all financial statements required by the SEC to be filed
therewith;
(b) subject to the last three sentences of this Section 4(b) and
Section 4(i) hereof, (i) prepare and file with the SEC such amendments to
such Registration Statement as may be necessary to keep such Registration
Statement effective for the applicable period; (ii) cause the Shelf
Prospectus to be amended or supplemented as required and to be filed as
required by Rule 424 or any similar rule that may be adopted under the
Securities Act; (iii) respond as promptly as practicable to any comments
received from the SEC with respect to the Shelf Registration Statement or
any amendment thereto; and (iv) comply with the provisions of the
Securities Act with respect to the disposition of all securities covered by
such Shelf Registration Statement during the applicable period in
accordance with the intended method or methods of distribution by the
Lichtin Holders covered thereby. Notwithstanding anything to the contrary
contained herein, the Company shall not be required to take any of the
actions described in clauses (i), (ii) or (iii) in this Section 4(b),
Section 4(d) or Section 4(i) with respect to the Shelf Registrable
Securities (x) to the extent that the Company is in possession of material
non-public information that it deems advisable not to disclose or is
engaged in active negotiations or planning for a merger or acquisition or
disposition transaction and it delivers written notice to the Lichtin
Holders to the effect that the Lichtin Holders may not make offers or sales
under the Shelf Registration Statement for a period not to exceed thirty
(30) days from the date of such notice; provided, however, that the
-------- -------
Company may deliver only two such notices within any twelve-month period,
and (y) unless and until the Company has received a written notice (a
"Shelf Registration Notice") from the Lichtin Holders that they intend to
-8-
<PAGE>
make offers or sales under the Shelf Registration Statement as specified in
such Shelf Registration Notice; provided, however, that the Company
-------- -------
shall have ten (10) business days to prepare and file any such amendment or
supplement after receipt of the Shelf Registration Notice. Once the Lichtin
Holders have delivered a Shelf Registration Notice to the Company, each
Lichtin Holder covered thereby shall promptly provide to the Company such
information as the Company reasonably requests in order to identify the
method of distribution in a post-effective amendment to the Shelf
Registration Statement or a supplement to the Shelf Prospectus. Such
Lichtin Holders also shall notify the Company in writing upon completion of
such offer or sale or at such time as such Lichtin Holders no longer intend
to make offers or sales under the Shelf Registration Statement;
(c) after the Lichtin Holders have delivered a Shelf Registration
Notice to the Company, furnish each Lichtin Holder covered thereby, without
charge, as many copies of each Shelf Prospectus and any amendment or
supplement thereto in order to facilitate the public sale or other
disposition of the Shelf Registrable Securities; the Company consents to
the use of the Shelf Prospectus and any amendment or supplement thereto by
the Lichtin Holders of Shelf Registrable Securities in connection with the
offering and sale of the Shelf Registrable Securities covered by the Shelf
Prospectus or amendment or supplement thereto;
(d) use its reasonable and diligent efforts to register or qualify the
Shelf Registrable Securities by the time the Shelf Registration Statement
is declared effective by the SEC under all applicable state securities or
blue sky laws of such jurisdictions in the United States and its
territories and possessions as the Lichtin Holders shall reasonably request
in writing, keep each such registration or qualification effective during
the period such Shelf Registration Statement is required to be kept
effective or during the period offers or sales are being made by the
Lichtin Holders after they have delivered a Shelf Registration Notice to
the Company, whichever is shorter; provided, however, that in connection
-------- -------
therewith, the Company shall not be required to (i) qualify as a foreign
corporation to do business or to register as a broker or dealer in any such
jurisdiction where it would not otherwise be required to qualify or
register but for this Section 4(d), (ii) subject itself to taxation in any
such jurisdiction where is not otherwise subject to taxation, or (iii) file
a general consent to service of process in any such jurisdiction;
(e) notify the Lichtin Holders promptly and confirm in writing, (i)
when the Shelf Registration Statement and any post-effective amendments
thereto have become effective, (ii) when any amendment or supplement to the
Shelf Prospectus has been filed with the SEC, (iii) of the issuance by the
SEC or any state securities authority of any stop order suspending the
effectiveness of the Shelf Registration Statement or any part thereof or
the initiation of any proceedings for that purpose, (iv) if the Company
receives any notification with respect to the suspension of the
qualification of the Shelf Registrable Securities for offer or sale in any
-9-
<PAGE>
jurisdiction or the initiation of any proceeding for such purpose, and (v)
of the happening of any event during the period the Shelf Registration
Statement is effective as a result of which (A) such Shelf Registration
Statement contains any untrue statement of a material fact or omits to
state any material fact required to be stated therein or necessary to make
the statements therein not misleading or (B) the Shelf Prospectus as then
amended or supplemented contains any untrue statement of a material fact or
omits to state any material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading;
(f) make every reasonable effort to obtain the withdrawal of any order
suspending the effectiveness of the Shelf Registration Statement or any
part thereof as promptly as possible;
(g) after the Lichtin Holders have delivered a Shelf Registration
Notice to the Company, furnish to each Lichtin Holder covered thereby,
without charge, at least one conformed copy of the Shelf Registration
Statement and any post-effective amendment thereto (without documents
incorporated therein by reference or exhibits thereto, unless requested);
(h) cooperate with each selling Lichtin Holder to facilitate the timely
preparation and delivery of certificates representing Shelf Registrable
Securities to be sold and not bearing any Securities Act legend; and enable
certificates for such Shelf Registrable Securities to be issued for such
numbers of shares as each Lichtin Holder may reasonably request at least
two business days prior to any sale of Shelf Registrable Securities;
(i) subject to the last three sentences of Section 4(b) hereof, upon
the occurrence of any event contemplated by clause (x) of Section 4(b) or
clause (v) of Section 4(e) hereof, use its reasonable and diligent efforts
promptly to prepare and file an amendment or a supplement to the Shelf
Prospectus or any document incorporated therein by reference or prepare,
file and obtain effectiveness of a post-effective amendment to the Shelf
Registration Statement, or file any other required document, in any such
case to the extent necessary so that, as thereafter delivered to the
purchasers of the Shelf Registrable Securities, such Shelf Prospectus as
then amended or supplemented will not contain any untrue statement of a
material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
are made, not misleading;
(j) after the Lichtin Holders have provided a Shelf Registration Notice
to the Company, make available for inspection by each Lichtin Holder
covered thereby and any counsel, accountants or other representatives
retained by such Lichtin Holder all financial and other records, pertinent
corporate documents and properties of the Company and cause the officers,
directors and employees of the Company to supply all such records,
documents or information reasonably requested by such Lichtin Holder,
counsel, accountants or representatives in connection with the Shelf
Registration Statement; provided, however, that such records, documents or
-------- -------
-10-
<PAGE>
information which the Company determines in good faith to be confidential
and notifies such Lichtin Holder, counsel, accountants or representatives
in writing that such records, documents or information are confidential
shall not be disclosed by such Lichtin Holder, counsel, accountants or
representatives unless (i) such disclosure is ordered pursuant to a
subpoena or other order from a court of competent jurisdiction or
governmental agency, or (ii) such records, documents or information become
generally available to the public other than through a breach of this
Agreement;
(k) a reasonable time prior to the filing of any Shelf Registration
Statement or any amendment thereto, or any Shelf Prospectus or any
amendment or supplement thereto, provide copies of such document (not
including any documents incorporated by reference therein unless requested)
to each Lichtin Holder covered thereby after the Lichtin Holders have
provided a Shelf Registration Notice to the Company;
(l) use its reasonable and diligent efforts to cause all Shelf
Registrable Securities to be listed on any securities exchange on which
similar securities issued by the Company are then listed;
(m) provide a CUSIP number for all Shelf Registrable Securities, not
later than the effective date of a Shelf Registration Statement; and
(n) use its reasonable efforts to make available to its security
holders, as soon as reasonably practicable, an earnings statement covering
at least 12 months which shall satisfy the provisions of Section 11(a) of
the Securities Act and Rule 158 thereunder or any similar rule as may be
adopted by the SEC.
The Company may require each Lichtin Holder to furnish to the Company in
writing such information regarding the proposed distribution by such Lichtin
Holder as the Company may from time to time reasonably request in writing.
In connection with and as a condition to the Company's obligations with
respect to the Shelf Registration Statement pursuant to Section 3 hereof and
this Section 4, each Lichtin Holder covenants and agrees that (i) it will not
offer or sell any Shelf Registrable Securities under the Shelf Registration
Statement until it has provided a Shelf Registration Notice pursuant to Section
4(b) and has received copies of the Shelf Prospectus as then amended or
supplemented as contemplated by Section 4(c) and notice from the Company that
the Shelf Registration Statement and any post-effective amendments thereto have
become effective as contemplated by Section 4(e); (ii) upon receipt of any
notice from the Company contemplated by Section 4(b) or Section 4(e) (in respect
of the occurrence of an event contemplated by clause (v) of Section 4(e)), such
Lichtin Holder shall not offer or sell any Shelf Registrable Securities pursuant
to the Shelf Registration Statement until such Lichtin Holder receives copies of
the supplemented or amended Shelf Prospectus contemplated by Section 4(i) hereof
and receives notice that any post-effective amendment has become effective, and,
-11-
<PAGE>
if so directed by the Company, such Lichtin Holder will deliver to the Company
(at the expense of the Company) all copies in its possession, other than
permanent file copies then in such Lichtin Holder's possession, of the Shelf
Prospectus as amended or supplemented at the time of receipt of such notice;
(iii) all offers and sales by such Lichtin Holder under the Shelf Registration
Statement shall be completed within sixty (60) days after the first date on
which offers or sales can be made pursuant to clause (i) above, and upon
expiration of such sixty (60) day period, such Lichtin Holder will not offer or
sell any Shelf Registrable Securities under the Shelf Registration Statement
until it has again complied with the provisions of clause (i) above; (iv) such
Lichtin Holder and any of its beneficial owners, officers, directors or
affiliates, if any, will comply with the provisions of Rule 10b-6 and 10b-7
under the Exchange Act as applicable to them in connection with sales of Shelf
Registrable Securities pursuant to the Shelf Registration Statement; (v) such
Lichtin Holder and any of its beneficial owners, officers, directors or
affiliates, if any, will comply with the prospectus delivery requirements of the
Securities Act as applicable to them in connection with sales of Shelf
Registrable Securities pursuant to the Shelf Registration Statement; and (vi)
such Lichtin Holder and any of its beneficial owners, officers, directors or
affiliates, if any, will enter into such written agreements as the Company shall
reasonably request to ensure compliance with clause (iv) and (v) above.
5. Demand Registrations for the Benefit of the Lichtin Holders.
-----------------------------------------------------------
(a) Requests for Demand Registration. In the event that the Company is
--------------------------------
not permitted to file the Shelf Registration Statement in accordance with the
provisions of Section 3(d) hereof, the Lichtin Holders shall immediately become
entitled to the rights of this Section 5. Accordingly, Lichtin Holders of 50%
or more of the Demand Registrable Securities, by written request delivered to
the Company on or after the first business day following the expiration of the
last Lichtin Holders Lock-Up Period that is applicable to Units or Shares which
were issued on, prior to, or as of June 30, 1998, may request registration under
the Securities Act of all or any portion of the Demand Registrable Securities
held by such Lichtin Holders for sale in the manner specified in such request.
Each initial request for a registration pursuant to this Section 5 shall specify
the number of Demand Registrable Securities requested to be registered and sold
by the Lichtin Holders, the method of disposition to be employed and the Current
Market Price of the Common Stock as of the date of such request. Within 10 days
after receipt of any request for registration under this Section 5(a), the
Company shall promptly give written notice to any other Lichtin Holders of
Demand Registrable Securities from whom notice has not been received and shall
use its commercially reasonable efforts to include in such registration (for
sale in accordance with the method of disposition specified in the initial
request) all Demand Registrable Securities with respect to which the Company has
received written requests for inclusion therein within 20 days after the receipt
of the notice from the Company, which written requests shall specify the number
of Demand Registrable Securities to be included. Any request for registration
pursuant to this Section 5(a) shall be referred to herein as a "Demand
Registration Request" and all registrations requested pursuant to this Section 5
are referred to herein as "Demand Registrations."
-12-
<PAGE>
(b) Number of Demand Registrations. The Company shall be required to
------------------------------
effect three (3) Demand Registrations pursuant to this Section 5.
Notwithstanding anything to the contrary contained herein, a registration shall
count as a Demand Registration only when a registration statement covering all
Demand Registrable Securities covered by such Demand Registration Request shall
have become effective (except that if, after it has become effective, the
offering of Demand Registrable Securities pursuant to such registration
statement is interfered with by any stop order, injunction or action of the SEC
not occasioned by the fault of any Lichtin Holder, such registration shall be
deemed not to have been effected unless such stop order, injunction or other
order or request shall subsequently have been vacated or otherwise removed) and,
if such method of disposition is a firm commitment underwritten public offering,
all such Demand Registrable Securities shall have been sold pursuant thereto;
provided, however, that if a registration statement filed by the Company
- -------- -------
pursuant to a Demand Registration Request shall be abandoned or withdrawn at the
behest of the Lichtin Holders, then, unless such Lichtin Holders shall, promptly
upon receipt of a request by the Company therefor supported by an invoice
setting forth the expenses in reasonable detail, reimburse the Company for the
Demand Registration Expenses in respect of such registration statement
attributable to the Lichtin Holders, the Company shall be deemed to have
effected a Demand Registration.
(c) Minimum Offering Amount. The Company shall not be required to
-----------------------
register Demand Registrable Securities pursuant to this Section 5 unless the
aggregate Current Market Price of all Demand Registrable Securities covered by
the Demand Registration Request shall be $1,000,000 or more (unless and to the
extent the Lichtin Holders shall hold in the aggregate less than $1,000,000 of
Demand Registrable Securities, in which case such minimum offering amount shall
be equal to the amount of Demand Registrable Securities so held).
(d) Selection of Underwriters. If the method of disposition specified in
-------------------------
a Demand Registration Request shall be an underwritten public offering, the
Company may designate the managing underwriter of such offering, subject to the
approval of the Lichtin Holders, which approval shall not be unreasonably
withheld.
(e) Priority on Demand Registrations. The Company shall be entitled to
--------------------------------
include in any registration statement referred to in this Section 5, for sale in
accordance with the method of disposition specified in the Demand Registration
Request, shares of Common Stock to be sold by the Company for its own account or
by other shareholders of the Company for their account. Nonetheless, whether or
not the Company desires to include any such additional shares in a Demand
Registration, if such method of disposition is an underwritten public offering
and the managing underwriters advise the Company in writing that in their
opinion the number of securities requested to be included in such registration
exceeds the maximum number which can be included in such offering without
adversely affecting the marketability of the offering (the "Maximum Number"),
then the Company will limit the number of shares included in such registration
to the Maximum Number, and the shares registered shall be selected in the
following order of priority: (i) first, Demand Registrable Securities covered by
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<PAGE>
the Demand Registration Request, (ii) second, securities the Company proposes to
sell and (iii) third, other securities requested to be included in such
registration.
(f) Exception. Anything in this Section 5 to the contrary
---------
notwithstanding, the Company shall not be required to file a registration
statement in connection with a Demand Registration (i) within six months after
the effective date of a Demand Registration or any registration statement of the
type referred to in Section 6, provided that, as contemplated by Section 6, the
Lichtin Holders shall have been afforded the opportunity to sell Demand
Registrable Securities pursuant to such registration statement, and all Demand
Registrable Securities requested to be registered shall have been so registered
and, if such registration statement shall relate to an underwritten public
offering, shall have been included therein to the extent requested by the
Lichtin Holders and shall have been sold or (ii) if counsel for the Company,
reasonably acceptable to the Lichtin Holders shall deliver an opinion to the
Lichtin Holders to the effect that, pursuant to Rule 144 under the Securities
Act (including an opinion that the Company has satisfied the necessary
informational requirements under Rule 144 as of the date of the opinion) or
otherwise, the Lichtin Holders can publicly offer and sell the Demand
Registrable Securities as to which registration has been requested in a single
transaction without registration under the Securities Act.
6. Piggyback Registrations for the Benefit of the Lichtin Holders.
--------------------------------------------------------------
(a) Right to Piggyback. In the event that the Company is not permitted to
------------------
file the Shelf Registration Statement in accordance with the provisions of
Section 3(d) hereof, the Lichtin Holders shall immediately become entitled to
the rights of this Section 6. Accordingly, if on or after the first business
day following the expiration of the last Lichtin Holders Lock-Up Period that is
applicable to Units or Shares which were issued on, prior to, or as of June 30,
1998, the Company at any time proposes to register any of its Common Stock or
other securities under the Securities Act for sale to the public, whether for
its own account or for the account of other shareholders or both (except with
respect to registration statements on Form S-8 or another form not available for
registering the Demand Registrable Securities for sale to the public) (a
"Piggyback Registration"), the Company will promptly (but in any event within 30
days) give written notice to the Lichtin Holders of its intention to effect such
registration and a description of any underwriting agreement to be entered into
with respect thereto and will include in such registration all Demand
Registrable Securities with respect to which the Company has received written
requests for inclusion within 15 days after the receipt of the Company's notice
(a "Piggyback Registration Request"); provided, however, that the Company shall
-------- -------
not be required to include Demand Registrable Securities in the securities to be
registered pursuant to a registration statement on any form which limits the
amount of securities which may be registered by the issuer and/or selling
security holders if, and to the extent that, such inclusion would make the use
of such form unavailable. In the event that any Piggyback Registration shall
be, in whole or in part, an underwritten public offering of Common Stock, any
Piggyback Registration Request by the Lichtin Holders shall specify that either
(i) such Demand Registrable Securities are to be included in the underwriting on
the same terms and conditions as the shares of Common Stock otherwise being sold
through underwriters under such registration, or (ii) such Demand Registrable
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<PAGE>
Securities are to be sold in the open market without any underwriting, on terms
and conditions comparable to those normally applicable to offerings of common
stock in reasonably similar circumstances.
(b) Priority on Primary Registrations. If a Piggyback Registration is an
---------------------------------
underwritten primary registration on behalf of the Company, and the managing
underwriters advise the Company in writing that in their opinion the number of
shares requested to be included in such registration exceeds the Maximum Number,
the Company will limit the number of shares included in such registration to the
Maximum Number, and the shares registered shall be selected in the following
order of priority: (i) first, securities the Company proposes to sell, (ii)
securities requested to be included in such registration pursuant to the
Registration Rights and Lock-Up Agreement dated as of August 24, 1994, by and
among Weeks Corporation and the Company Participants Listed on Schedule A
thereof and the Other Participants Listed on Schedule B thereof, (iii) third,
(a) Demand Registrable Securities covered by Piggyback Registration Requests,
(b) securities covered by piggyback registration requests pursuant to the
Registration Rights and Lock-Up Agreement for Post-June 30, 1998 Units dated as
of the date hereof by and among Weeks Corporation and Harold S. Lichtin, Noel A.
Lichtin, Marie A. Robertson, Amy R. Ehrman, Roland G. Robertson and Perimeter
Park West Associates Limited Partnership, (c) securities covered by piggyback
registration requests pursuant to the Registration Rights and Lock-Up Agreement
dated as of November 1, 1996, by and among Weeks Corporation, NWI Warehouse
Group, L.P., Buckley & Company Real Estate, Inc., John W. Nelley, Jr. and Albert
W. Buckley, Jr., and (d) securities covered by piggyback registration requests
pursuant to the Registration Rights and Lock-Up Agreement for Post-March 31,
1998 Shares and Units dated as of November 1, 1996, by and among Weeks
Corporation, NWI Warehouse Group, L.P. and Buckley & Company Real Estate, Inc.,
pro rata among the holders thereof on the basis of the number of shares
requested to be included in such registration and (iv) fourth, other securities
requested to be included in such registration.
(c) Priority on Secondary Registrations. If a Piggyback Registration is
-----------------------------------
an underwritten secondary registration on behalf of holders of the Company's
securities, and the managing underwriters advise the Company in writing that in
their opinion the number of securities requested to be included in such
registration exceeds the Maximum Number, the Company will include in such
registration the shares requested to be included therein by the holders
requesting such registration and the Demand Registrable Securities covered by
Piggyback Registration Requests and any other securities requested to be
included in such registration, pro rata among the holders thereof on the basis
of the number of shares requested to be included in such registration; provided,
--------
however, that if the holders requesting registration are doing so pursuant to
- -------
demand registration rights of such holders, such holders' shares shall take
priority over any Demand Registrable Securities and any other securities
requested to be included, which shall be included on a pro rata basis.
7. Holdback Agreements.
-------------------
(a) Lichtin Holders of Demand Registrable Securities. Each Lichtin Holder
------------------------------------------------
agrees not to effect any public sale or distribution (including sales pursuant
to Rule 144) of equity securities of the Company, or any securities convertible
-15-
<PAGE>
into or exchangeable or exercisable for such securities, during the 7 days prior
to (provided that such Lichtin Holder receives a notice from the Company of the
commencement of such 7-day period) and the 90-day period beginning on the
effective date of any underwritten Demand Registration or any underwritten
Piggyback Registration in which Demand Registrable Securities are included
(except as part of such underwritten registration), unless the underwriters
managing the registered public offering otherwise agree.
(b) Company Officers and Directors. The Company agrees (i) not to effect
------------------------------
any public sale or distribution of its equity securities, or any securities
convertible into or exchangeable or exercisable for such securities, during the
7 days prior to (provided that the Company receives notice of the commencement
of such 7-day period) and the 90-day period beginning on the effective date of
any underwritten Demand Registration or any underwritten Piggyback Registration
(except as part of such underwritten registration or pursuant to registrations
on Form S-8 or any successor form), unless the underwriters managing the
registered public offering otherwise agree, and (ii) to use its commercially
reasonable efforts to cause each of the Company's officers and directors who
hold Common Stock or any securities convertible into or exercisable for Common
Stock, to agree not to effect any public sale or distribution (including sales
pursuant to Rule 144) of any such securities during such period (except as part
of such underwritten registration, if otherwise permitted), unless the
underwriters managing the registered public offering otherwise agree.
8. Demand Registration Procedures. If and whenever the Company is
------------------------------
required by the provisions of Section 5 or 6 hereof to use its reasonable
efforts to effect the registration of any of the Demand Registrable Securities
under the Securities Act, the Company shall use its reasonable and diligent
efforts to effect the registration and sale of the Demand Registrable Securities
in accordance with the intended method of disposition thereof and will, as
expeditiously as possible:
(a) and in any case within 90 days after receiving a request for a
Demand Registration, prepare and file with the SEC a registration statement
(the "Demand Registration Statement") with respect to such Demand
Registrable Securities and use its reasonable and diligent efforts to cause
such Demand Registration Statement to become and remain effective for the
period of the distribution contemplated thereby (determined as hereinafter
provided). Notwithstanding anything to the contrary contained herein, the
filing of such Demand Registration Statement may be delayed for a period
not to exceed 60 days if (i) the Company is contemplating a public offering
of its securities and, in the judgment of the managing underwriter thereof
(or the Company if such offering is not underwritten) such filing would
have a material adverse effect on the contemplated offering, (ii) the
Company is in possession of material non-public information that it deems
advisable not to disclose in a Demand Registration Statement or is engaged
in active negotiations or planning for a merger or acquisition or
disposition transaction, or (iii) the Company is engaged in any program for
the repurchase of Common Stock or other securities of the Company;
-16-
<PAGE>
(b) prior to the filing described in paragraph (a) above, furnish to
the selling Lichtin Holders copies of the Demand Registration Statement and
any amendments or supplements thereto and any prospectus forming a part
thereof, which documents shall be subject to the approval of such Lichtin
Holders only with respect to any statement in the Demand Registration
Statement which relates to such Lichtin Holders;
(c) notify the selling Lichtin Holders promptly and confirm in writing,
(i) when the Demand Registration Statement and any post-effective
amendments thereto have become effective, (ii) when any amendment or
supplement to the Demand Prospectus has been filed with the SEC, (iii) of
the issuance by the SEC or any state securities authority of any stop order
suspending the effectiveness of the Demand Registration Statement or any
part thereof or the initiation of any proceedings for that purpose, (iv) if
the Company receives any notification with respect to the suspension of the
qualification of the Demand Registrable Securities for offer or sale in any
jurisdiction or the initiation of any proceeding for such purpose, and (v)
of the happening of any event during the period the Demand Registration
Statement is effective as a result of which (A) such Demand Registration
Statement contains any untrue statement of a material fact or omits to
state any material fact required to be stated therein or necessary to make
the statements therein not misleading or (B) the Demand Prospectus as then
amended or supplemented contains any untrue statement of a material fact or
omits to state any material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading;
(d) make every reasonable effort to obtain the withdrawal of any order
suspending the effectiveness of the Demand Registration Statement or any
part thereof as promptly as possible;
(e) after the Lichtin Holders have delivered a Demand Registration
Request to the Company, furnish to each selling Lichtin Holder, without
charge, at least one conformed copy of the Demand Registration Statement
and any post-effective amendment thereto (without documents incorporated
therein by reference or exhibits thereto, unless requested);
(f) prepare and file with the SEC such amendments and supplements to
such Demand Registration Statement and the Demand Prospectus used in
connection therewith as may be necessary to keep such Demand Registration
Statement effective for the period specified in paragraph (a) above and to
comply with the provisions of the Securities Act with respect to the
disposition of all Demand Registrable Securities covered by such Demand
Registration Statement in accordance with each Lichtin Holder's intended
method of disposition set forth in such Demand Registration Statement for
such period;
-17-
<PAGE>
(g) furnish to each selling Lichtin Holder and to each underwriter such
number of copies of the Demand Registration Statement and the Demand
Prospectus included therein (including each preliminary prospectus) and
such other documents, as such persons may reasonably request in order to
facilitate the public sale or other disposition of the Demand Registrable
Securities covered by such Demand Registration Statement;
(h) use its reasonable and diligent efforts to register or qualify the
Demand Registrable Securities covered by such Demand Registration Statement
under the securities or blue sky laws of such jurisdictions as the Lichtin
Holders or, in the case of an underwritten public offering, the managing
underwriter, shall reasonably request;
(i) provide a transfer agent and registrar, which may be a single
entity, for all Demand Registrable Securities not later than the effective
date of the Demand Registration Statement;
(j) use its reasonable and diligent efforts to cause all Demand
Registrable Securities to be listed on any securities exchange on which
similar securities issued by the Company are then listed;
(k) if the offering is underwritten, to furnish, at the request of the
Lichtin Holders, on the date that Demand Registrable Securities are
delivered to the underwriters for sale pursuant to such registration: (i)
an opinion dated such date of counsel representing the Company for the
purposes of such registration, addressed to the underwriters, stating that
such Demand Registration Statement has become effective under the
Securities Act and that (A) to the best knowledge of such counsel, no stop
order suspending the effectiveness thereof has been issued and no
proceedings for that purpose have been instituted or are pending or
contemplated under the Securities Act, (B) the Demand Registration
Statement, the related Demand Prospectus, and each amendment or supplement
thereto, comply as to form in all material respects with the requirements
of the Securities Act and the applicable rules and regulations of the SEC
thereunder and that such counsel does not believe that any such Demand
Registration Statement, Demand Prospectus, amendment or supplement contains
a misstatement of a material fact or an omission to state a material fact
required to be stated therein or necessary to make the statements made
therein, in light of the circumstances under which they were made, not
misleading (except that such counsel need express no opinion as to
financial statements or financial or statistical data contained therein)
and (C) to such other effects as may reasonably be requested by counsel for
the underwriters or by the Lichtin Holders or their counsel, and (ii) a
letter dated such date from the independent public accountants retained by
the Company, addressed to the underwriters, stating that they are
independent public accountants within the meaning of the Securities Act and
that, in the opinion of such accountants, the financial statements of the
Company included in the Demand Registration Statement or the Demand
Prospectus, or any amendment or supplement thereto, comply as to form in
all material respects with the applicable accounting requirements of the
Securities Act, and such letter shall additionally cover such other
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<PAGE>
financial matters (including information as to the period ending no more
than five business days prior to the date of such letter) with respect to
the registration in respect of which such letter is being given as such
underwriters may reasonably request;
(l) after the Lichtin Holders have provided a Demand Registration
Request to the Company, make available for inspection by each Lichtin
Holder and any counsel, accountants or other representatives retained by
such Lichtin Holder all financial and other records, pertinent corporate
documents and properties of the Company and cause the officers, directors
and employees of the Company to supply all such records, documents or
information reasonably requested by such Lichtin Holder, counsel,
accountants or representatives in connection with the Demand Registration
Statement; provided, however, that such records, documents or information
-------- -------
which the Company determines in good faith to be confidential and notifies
such Lichtin Holder, counsel, accountants or representatives in writing
that such records, documents or information are confidential shall not be
disclosed by such Lichtin Holder, counsel, accountants or representatives
unless (i) such disclosure is ordered pursuant to a subpoena or other order
from a court of competent jurisdiction or governmental agency, or (ii) such
records, documents or information become generally available to the public
other than through a breach of this Agreement; and
(m) cooperate with each selling Lichtin Holder to facilitate the timely
preparation and delivery of certificates representing Demand Registrable
Securities to be sold and not bearing any Securities Act legend; and enable
certificates for such Demand Registrable Securities to be issued for such
numbers of shares as each Lichtin Holder may reasonably request at least
two business days prior to any sale of Demand Registrable Securities.
For purposes of paragraphs (a) and (f) of this Section 8, the period of
distribution of Demand Registrable Securities in a firm commitment underwritten
public offering shall be deemed to be that period during which the underwriters
in such offering require in an underwriting agreement in the form customarily
used by such underwriters for comparable transactions that the Company keep a
registration statement effective to permit each underwriter to complete the
distribution of all securities purchased by it, and the period of distribution
of Demand Registrable Securities in any other registration shall be deemed to
extend until the earlier of the sale of all Demand Registrable Securities
covered thereby or nine months after the effective date thereof.
In connection with each registration hereunder, each selling Lichtin Holder
will furnish to the Company in writing such information with respect to itself
and the proposed distribution by itself as shall be reasonably necessary in
order to assure compliance with federal and applicable state securities laws.
Reasonable compliance with the obligation to furnish such information shall be a
condition to the rights afforded each Lichtin Holder hereunder. In addition,
each selling Lichtin Holder and any of its beneficial owners, officers,
directors or affiliates, if any, (i) will comply with the provisions of
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<PAGE>
Rule 10b-6 and 10b-7 under the Exchange Act as applicable to them in connection
with sales of Demand Registrable Securities pursuant to the Demand Registration
Statement; (ii) will comply with the prospectus delivery requirements of the
Securities Act as applicable to them in connection with sales of Demand
Registrable Securities pursuant to the Demand Registration Statement; and (iii)
will enter into such written agreements as the Company shall reasonably request
to ensure compliance therewith.
In connection with each registration pursuant to Sections 5 and 6 hereof
covering an underwritten public offering, the Company agrees to enter into a
written agreement with the managing underwriter selected in the manner herein
provided in such form and containing such provisions as are customary in the
securities business for such an arrangement between major underwriters and
companies of the Company's size and investment stature; provided that such
--------
agreement shall not contain any such provision applicable to the Company which
is inconsistent with the provisions hereof; provided, further that the time and
-------- -------
place of the closing under said agreement shall be as mutually agreed upon
between the Company and such managing underwriter.
9. Demand and Piggyback Registration Expenses. In connection with any
------------------------------------------
Demand Registration or Piggyback Registration, the Company shall pay all Demand
Registration Expenses and the selling Lichtin Holders shall pay all Selling
Expenses applicable to the shares sold by such Lichtin Holders.
10. Indemnification; Contribution.
-----------------------------
(a) Indemnification by the Company. The Company agrees to indemnify and
------------------------------
hold harmless each Lichtin Holder and the beneficial owners, officers and
directors and each Person, if any, who controls each Lichtin Holder within the
meaning of Section 15 of the Securities Act as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to which each Lichtin Holder, or any beneficial
owner, officer, director or controlling Person may become subject under the
Securities Act or otherwise (A) that arise out of or are based upon any
untrue statement or alleged untrue statement of a material fact contained
in the Shelf Registration Statement or any amendment thereto, or the
omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not
misleading, (B) that arise out of or are based upon any untrue statement or
alleged untrue statement of a material fact contained in any Shelf
Prospectus or any amendment or supplement thereto, or the omission or
alleged omission to state therein a material fact necessary in order to
make the statements therein, in the light of the circumstances under which
they were made, not misleading, (C) that arise out of or are based upon any
untrue statement or alleged untrue statement of a material fact contained
in any Demand Registration Statement or any amendment thereto, or the
omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not
misleading, or (D) that arise out of or are based upon any untrue statement
or alleged untrue statement of a material fact contained in any Demand
Prospectus or any amendment or supplement thereto, or the omission or
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<PAGE>
alleged omission to state therein a material fact necessary in order to
make the statements therein, in the light of the circumstances under which
they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or alleged untrue statement
or any omission or alleged omission, if such settlement is effected with
the written consent of the Company; and
(iii) subject to the limitations set forth in Section 10(c), against
any and all expense whatsoever, as incurred (including reasonable fees and
disbursements of counsel), reasonably incurred in investigating, preparing
or defending against any litigation, or investigation or proceeding by any
governmental agency or body, commenced or threatened, in each case whether
or not a party, or any claim whatsoever based upon any such untrue
statement or alleged untrue statement or omission or alleged omission, to
the extent that any such expense is not paid under subparagraph (i) or (ii)
above;
provided, however, that the indemnity provided pursuant to this Section 10(a)
- -------- -------
shall not apply with respect to any loss, liability, claim, damage or expense
that arise out of or are based upon any untrue statement or alleged untrue
statement or omission or alleged omission made in reliance upon and in
conformity with written information furnished to the Company by any Lichtin
Holder (i) expressly for use in the Shelf Registration Statement or any
amendment thereto, the Shelf Prospectus or any amendment or supplement thereto,
the Demand Registration Statement or any amendment thereto, or the Demand
Prospectus or any amendment or supplement thereto or (ii) pursuant to any
representation, warranty or other statement contained in any of the Contribution
Agreements or any admission amendment to the Partnership Agreement.
(b) Indemnification by the Lichtin Holders. Each Lichtin Holder
--------------------------------------
severally agrees to indemnify and hold harmless the Company, and each of its
respective directors and officers (including each director and officer of the
Company who signed the Shelf Registration Statement or Demand Registration
Statement), and each Person, if any, who controls the Company within the meaning
of Section 15 of the Securities Act, to the same extent as the indemnity
contained in Section 10(a) hereof, but only insofar as such loss, liability,
claim, damage or expense arises out of or is based upon any untrue statement or
alleged untrue statement or omission or alleged omission made in the Shelf
Registration Statement or any amendment thereto, the Shelf Prospectus or any
amendment or supplement thereto, the Demand Registration Statement or any
amendment thereto, the Demand Prospectus or any amendment or supplement thereto,
or any of the Contribution Agreements, in reliance upon and in conformity with
written information furnished to the Company by such Lichtin Holder expressly
for use therein. In no event, however shall the liability of a Lichtin Holder
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<PAGE>
exceed the cumulative net proceeds received by such Lichtin Holder from any
offering made in connection with a Demand Registration Statement or Shelf
Registration Statement, as the case may be.
(c) Conduct of Indemnification Proceedings. Each indemnified party shall
--------------------------------------
give reasonably prompt notice to each indemnifying party of any action or
proceeding commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party (i) shall not relieve
it from any liability which it may have under the indemnity agreement provided
in Section 10(a) or (b) above, unless and to the extent it did not otherwise
learn of such action and the lack of notice by the indemnified party materially
prejudices the indemnifying party or results in the forfeiture by the
indemnifying party of substantial rights and defenses and (ii) shall not, in any
event, relieve the indemnifying party from any obligations to any indemnified
party other than the indemnification obligation provided under Section 10(a) or
(b) above. After receipt of such notice, the indemnifying party shall be
entitled to participate in and, to the extent it shall wish, jointly with any
other indemnifying party so notified, to assume the defense of such action or
proceeding at such indemnifying party's own expense with counsel chosen by such
indemnifying party and approved by the indemnified party, which approval shall
not be unreasonably withheld; provided, however, that, if the defendants in any
-------- -------
such action or proceeding include both the indemnified party and the
indemnifying party and the indemnified party reasonably determines, upon advice
of counsel, that a conflict of interest exists or that there may be legal
defenses available to it or other indemnified parties that are different from or
in addition to those available to the indemnifying party, then the indemnified
party shall be entitled to separate counsel (which shall be limited to a single
law firm), the reasonable fees and expenses of which shall be paid by the
indemnifying party. If the indemnifying party does not assume the defense of
any such action or proceeding, after having received the notice referred to in
the first sentence of this paragraph, the indemnifying party will pay the
reasonable fees and expenses of counsel (which shall be limited to a single law
firm) for the indemnified party. In such event, however, the indemnifying party
will be liable for any settlement effected without the written consent of such
indemnifying party. If the indemnifying party assumes the defense of any such
action or proceeding in accordance with this paragraph, such indemnifying party
shall not be liable for any fees and expenses of counsel for the indemnified
party incurred thereafter in connection with such action or proceeding, except
as set forth in the proviso in the second sentence of this Section 10(c).
(d) Contribution. In order to provide for just and equitable contribution
------------
in circumstances in which the indemnity agreement provided for in this Section
10 is for any reason held to be unenforceable although applicable in accordance
with its terms, the Company and the selling Lichtin Holders shall contribute to
the aggregate losses, liabilities, claims, damages and expenses of the nature
contemplated by such indemnity agreement incurred by the Company and the selling
Lichtin Holders, in such proportion as is appropriate to reflect the relative
fault of and benefits to the Company on the one hand and the selling Lichtin
Holders on the other (in such proportion that the selling Lichtin Holders are
severally, not jointly, responsible for the balance), in connection with the
statements or omissions which resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable considerations.
The relative benefits to the indemnifying party and indemnified parties shall
be determined by reference to, among other things, the total proceeds received
by the indemnified party and indemnified parties in connection with the offering
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<PAGE>
to which such losses, claims, damages, liabilities or expenses relate. The
relative fault of the indemnifying party and indemnified parties shall be
determined by reference to, among other things, whether the action in question,
including any untrue or alleged untrue statement of a material fact or omission
or alleged omission to state a material fact, has been made by, or relates to
information supplied by, such indemnifying party or the indemnified parties, and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such action.
The parties hereto agree that it would not be just or equitable if
contribution pursuant to this Section 10(d) were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 10(d), a Lichtin Holder shall not
be required to contribute any amount in excess of the amount by which the total
price at which the Shelf Registrable Securities or the Demand Registrable
Securities, as the case may be, of such Lichtin Holder were offered to the
public exceeds the amount of any damages which such Lichtin Holder would
otherwise have been required to pay by reason of such untrue statement or
omission.
Notwithstanding the foregoing, no Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section 10(d), each Person,
if any, who controls any Lichtin Holder within the meaning of Section 15 of the
Securities Act and beneficial owners, directors and officers of any Lichtin
Holder shall have the same rights to contribution as any Lichtin Holder, and
each director of the Company, each officer of the Company who signed the Shelf
Registration Statement or the Demand Registration Statement, as the case may be,
and each Person, if any, who controls the Company within the meaning of Section
15 of the Securities Act shall have the same rights to contribution as the
Company.
(e) In the event any sale pursuant to a Shelf Registration, Demand
Registration or Piggyback Registration as an underwritten offering, then the
Company agrees to indemnify and hold harmless each underwriter of Shelf
Registerable Securities or Demand Registerable Securities to the same extent and
on substantially similar terms as the Company's indemnification of the members
of the Lichtin Holders as set forth in Section 10(a) above.
11. Rule 144 Sales.
--------------
(a) Compliance. The Company covenants that, so long as it is subject to
----------
the reporting requirements of the Exchange Act, it will file the reports
required to be filed by it under the Exchange Act so as to enable the selling
Lichtin Holders to sell Demand Registrable Securities or Shelf Registrable
Securities pursuant to Rule 144 under the Securities Act.
(b) Cooperation with the Lichtin Holders. In connection with any sale,
------------------------------------
transfer or other disposition by a Lichtin Holder of any Shelf Registrable
Securities or Demand Registrable Securities pursuant to Rule 144 under the
-23-
<PAGE>
Securities Act, the Company shall cooperate with such Lichtin Holder to
facilitate the timely preparation and delivery of certificates representing
Shelf Registrable Securities or Demand Registrable Securities to be sold and not
bearing any Securities Act legend, and enable certificates for such Shelf
Registrable Securities or Demand Registrable Securities to be for such number of
shares as such Lichtin Holder may reasonably request at least two business days
prior to any sale of Shelf Registrable Securities or Demand Registrable
Securities.
12. Miscellaneous.
-------------
(a) Amendments and Waivers. The provisions of this Agreement, including
----------------------
the provisions of this sentence, may not be amended, modified, supplemented or
waived, nor may consent to departures therefrom be given, without the written
consent of the Company and the Lichtin Holders.
(b) Notices. All notices and other communications provided for or
-------
permitted hereunder shall be made in writing by hand-delivery, registered first-
class mail, telex, telecopier, or any courier guaranteeing overnight delivery,
(i) if to the Lichtin Holders, at each of the addresses on the attached
signature pages or (ii) if to the Company, at 4497 Park Drive, Norcross, Georgia
30093, Attention: A. R. Weeks, Jr.
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five business
days after being deposited in the mail, postage prepaid, if mailed; when
answered back, if telexed; when receipt is acknowledged, if telecopied; or at
the time delivered if delivered by an air courier guaranteeing overnight
delivery.
(c) Successors and Assigns. This Agreement shall inure to the benefit of
----------------------
and be binding upon the successors, assigns and transferees of each of the
parties. If any successor, assignee or transferee of any Lichtin Holder shall
acquire Shelf Registrable Securities or Demand Registrable Securities, in any
manner, whether by operation of law or otherwise, such Shelf Registrable
Securities or Demand Registrable Securities shall be held subject to all of the
terms of this Agreement, and by taking and holding such Shelf Registrable
Securities or Demand Registrable Securities such Person shall be entitled to
receive the benefits hereof and shall be conclusively deemed to have agreed to
be bound by all of the terms and provisions hereof.
(d) Third Party Beneficiaries. There shall be no third party
-------------------------
beneficiaries or intended beneficiaries of this Agreement
(e) Counterparts. This Agreement may be executed in any number of
------------
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
-24-
<PAGE>
(f) Headings. The headings in this Agreement are for convenience of
--------
reference only and shall not limit or otherwise affect the meaning hereof.
(g) Governing Law. This Agreement shall be governed by and construed in
-------------
accordance with the laws of the State of Georgia without giving effect to the
conflicts of law provisions thereof.
(h) Specific Performance. The parties hereto acknowledge that there would
--------------------
be no adequate remedy at law if any party fails to perform any of its
obligations hereunder, and accordingly agree that each party, in addition to any
other remedy to which it may be entitled at law or in equity, shall be entitled
to compel specific performance of the obligations of any other party under this
Agreement in accordance with the terms and conditions of this Agreement in any
court of the United States or any State thereof having jurisdiction.
(i) Entire Agreement. This Agreement is intended by the parties as a
----------------
final expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein. This Agreement supersedes all prior
agreements and understandings between the parties with respect to such subject
matter.
-25-
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.
WEEKS CORPORATION
By:
-------------------------------------
Name:
Title:
HAROLD S. LICHTIN
----------------------------------------
Address: 1800 Perimeter Park Drive
Suite 200
Morrisville, NC 27560
NOEL A. LICHTIN
----------------------------------------
Address: 1800 Perimeter Park Drive
Suite 200
Morrisville, NC 27560
MARIE A. ROBERTSON
----------------------------------------
Address: c/o First Rock, Inc.
1525 The 600 Building
Corpus Christi, Texas 78473
-26-
<PAGE>
AMY R. EHRMAN
----------------------------------------
Address: c/o First Rock, Inc.
1525 The 600 Building
Corpus Christi, Texas 78473
ROLAND G. ROBERTSON
----------------------------------------
Address: c/o First Rock, Inc.
1525 The 600 Building
Corpus Christi, Texas 78473
PERIMETER PARK WEST ASSOCIATES
LIMITED PARTNERSHIP, a North Carolina
limited partnership
By:
-------------------------------------
Harold S. Lichtin, General Partner
By:
-------------------------------------
Marie Antoinette Robertson,
General Partner
Address: 1800 Perimeter Park Drive
Suite 200
Morrisville, NC 27560
-27-
<PAGE>
=========================
REGISTRATION RIGHTS AND LOCK-UP AGREEMENT
FOR POST-JUNE 30, 1998 UNITS
Dated as of December 31, 1996
by and among
WEEKS CORPORATION
and
HAROLD S. LICHTIN, NOEL A. LICHTIN,
MARIE A. ROBERTSON, AMY R. EHRMAN,
ROLAND G. ROBERTSON AND PERIMETER PARK
WEST ASSOCIATES LIMITED PARTNERSHIP
=========================
<PAGE>
REGISTRATION RIGHTS AND LOCK-UP AGREEMENT
FOR POST-JUNE 30, 1998 UNITS
THIS REGISTRATION RIGHTS AND LOCK-UP AGREEMENT FOR POST-JUNE 30, 1998 UNITS
(this "Agreement") is made and entered into as of December 31, 1996, by and
among WEEKS CORPORATION, a Georgia corporation (the "Company"), HAROLD S.
LICHTIN, an individual resident of North Carolina, NOEL A. LICHTIN, an
individual resident of North Carolina, MARIE A. ROBERTSON, an individual
resident of Texas, AMY R. EHRMAN, an individual resident of Texas, ROLAND G.
ROBERTSON, an individual resident of Texas, and PERIMETER PARK WEST ASSOCIATES
LIMITED PARTNERSHIP, a North Carolina limited partnership (Harold S. Lichtin,
Noel A. Lichtin, Marie A. Roberston, Amy R. Ehrman, Roland G. Robertson, and
Perimeter Park West Associates Limited Partnership are collectively referred to
hereafter as the "Lichtin Holders").
WHEREAS, this Agreement is made pursuant to (i) the Contribution Agreement
for the Northern Telecom Properties by and between Weeks and the Contributors
(as therein defined) dated as of even date herewith, and (ii) the Contribution
Agreement for the Perimeter Park West, Metro Center and Perimeter Park Land by
and between Weeks and the Contributors (as therein defined) dated as of even
date herewith (collectively, the documents referred to in clauses (i) and (ii)
are hereafter referred to as the "Contribution Agreements");
WHEREAS, the Lichtin Holders will become the owner of Units (as defined
below) in Weeks Realty, L.P., a Georgia limited partnership (the "Operating
Partnership"), in connection with the transactions described in the Contribution
Agreements;
WHEREAS, in order to induce Weeks to enter into the transactions described
in the Contribution Agreements, each of the Lichtin Holders has agreed to the
Lichtin Holders Lock-up (as defined below) set forth in Section 2(a) hereof; and
WHEREAS, in order to induce the Lichtin Holders to enter into the
transactions described in the Contribution Agreements, the Company has agreed,
with respect to the Units issued after June 30, 1998, to provide the Lichtin
Holders with the registration rights set forth in Section 3 hereof;
NOW, THEREFORE, the parties hereto, in consideration of the foregoing, the
mutual covenants and agreements hereinafter set forth, and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, agree as follows:
1. Definitions.
-----------
As used in this Agreement, the following capitalized defined terms shall
have the following meanings:
<PAGE>
"Common Stock" shall mean the Common Stock, par value $.01 per share, of
------------
the Company.
"Company" shall have the meaning set forth in the Preamble and also shall
-------
include the Company's successors.
"Contribution Agreements" shall have the meaning set forth in the Preamble.
-----------------------
"Control" shall mean the ability, whether by the direct or indirect
-------
ownership of shares or other equity interests, by contract or otherwise, to
select a majority of the directors of a corporation, to select the managing
partner of a partnership, to select the manager of a limited liability company
or otherwise to select, or have the power to remove and then select, a majority
of those persons exercising governing authority over an Entity. In the case of
a limited partnership, the sole general partner, each of the general partners
that has equal management control and authority, or the designated managing
general partner or managing general partners thereof shall be deemed to have
control of such partnership. In the case of a trust, any trustee thereof or any
Person having the right to select any such trustee shall be deemed to have
control of such trust.
"Entity" shall mean any general partnership, limited partnership,
------
corporation, limited liability company, joint venture, trust, business trust,
cooperative or association.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended
------------
from time to time.
"Lichtin Holders" shall have the meaning set forth in the Preamble.
---------------
Lichtin Holder shall mean each Lichtin Holder.
"Lichtin Holders Lock-up" shall have the meaning set forth in Section 2(a)
-----------------------
hereof.
"Lichtin Holders Lock-up Period" shall have the meaning set forth in
------------------------------
Section 2(a) hereof.
"Maximum Number" shall mean with respect to an underwritten public
--------------
offering, the maximum number of securities which in the opinion of the managing
underwriters can be included in such offering without adversely affecting the
marketability of the offering.
"Operating Partnership" shall have the meaning set forth in the Preamble
---------------------
and also shall include the Operating Partnership's successors and assigns.
"Partnership Agreement" shall mean the Second Amended and Restated
---------------------
Agreement of Limited Partnership of the Operating Partnership, as amended.
"Permitted Private Transfer" shall mean the transfer of Units or Shares
--------------------------
pursuant to a private placement permitted under Section 4(2) of the Securities
Act, or regulations promulgated thereunder, or a transfer which complies with
Rule 144 promulgated under the Securities Act.
-2-
<PAGE>
"Person" shall mean any individual or Entity.
------
"Piggyback Registration" shall have the meaning set forth in Section 3
----------------------
hereof.
"Piggyback Registration Request" shall have the meaning set forth in
------------------------------
Section 3 hereof.
"Piggyback Registrable Securities" shall mean the Shares held by Lichtin
--------------------------------
Holders (and the Shares issuable upon conversion of the Units) excluding (i)
Shares that have been disposed of under any other effective registration
statement, (ii) Shares sold or otherwise transferred pursuant to Rule 144 under
the Securities Act, and (iii) Shares held by Lichtin Holders if all of such
Shares are eligible for sale pursuant to Rule 144 under the Securities Act and
could be sold in one transaction in accordance with the volume limitations
contained in Rule 144(e)(1)(i) under the Securities Act.
"Piggyback Registration Expenses" shall mean any and all expenses incurred
-------------------------------
by the Company in connection with Piggyback Registrations, including, without
limitation: (i) all SEC, stock exchange and National Association of Securities
Dealers, Inc. ("NASD") registration and filing fees, (ii) all fees and expenses
incurred in connection with compliance with state securities or "blue sky" laws
(including reasonable fees and disbursements of counsel in connection with
qualification of any of the Piggyback Registrable Securities under any state
securities or blue sky laws and the preparation of a blue sky memorandum) and
compliance with the rules of the NASD, (iii) all expenses of any Persons in
preparing or assisting in preparing, word processing, printing and distributing
the Registration Statement, any Prospectus, certificates and other documents
relating to the performance of and compliance with this Agreement, (iv) all fees
and expenses incurred in connection with the listing, if any, of any of the
Piggyback Registrable Securities on any securities exchange or exchanges
pursuant to Section 5(i) hereof, (v) the fees and disbursements of counsel for
the Company and of the independent public accountants of the Company, including
the expenses of any special audits or "cold comfort" letters required by or
incident to such performance and compliance, and (vi) all other costs and
expenses normally associated with the issuance and sale of newly issued public
securities other than "Selling Expenses."
"Prospectus" shall mean the prospectus included in the Registration
----------
Statement, including any preliminary prospectus, and any amendment or supplement
thereto, including any supplement relating to the terms of the offering of any
portion of the Piggyback Registrable Securities covered by the Registration
Statement, and in each case including all material incorporated by reference
therein.
"Registration Statement" shall mean a registration statement prepared and
----------------------
filed with the SEC.
"SEC" shall mean the Securities and Exchange Commission.
---
"Securities Act" shall mean the Securities Act of 1933, as amended from
--------------
time to time.
-3-
<PAGE>
"Selling Expenses" shall mean all underwriting discounts and selling
----------------
commissions and transfer taxes applicable to the sale of Piggyback Registrable
Securities and disbursements of underwriters.
"Shares" shall mean any Common Stock issued to Lichtin Holders upon
------
redemption of those Units which were issued to Lichtin Holders after June 30,
1998.
"Units" shall mean the limited partnership interests of the Operating
-----
Partnership issued to Lichtin Holders after June 30, 1998, which interests are
redeemable for Common Stock, or at the Operating Partnership's option, cash.
2. Lock-Up Agreement
(a) Lock-Up Period for the Lichtin Holders. Each of the Lichtin Holders
--------------------------------------
hereby agrees that, except as set forth in Section 2(b) below, (i) with respect
to all Units issued after June 30, 1998 (except for those Units described in
clause (ii) below), from June 30, 1998 until the later of (x) one year after the
issuance of the last Units issued to the Lichtin Holders which the Lichtin
Holders become entitled to receive with respect to the acquisition by the
Operating Partnership of the Development Properties or the Northern Telecom
Properties (as described in the applicable Contribution Agreement) or (y) the
third anniversary of the date hereof, without the prior written consent of the
Company, such Lichtin Holder will not offer, sell, contract to sell, distribute
or otherwise dispose of (collectively, "Dispose of"), directly or indirectly, to
any Person any such Units (or Shares which are exchanged for such Units) and
(ii) with respect to the Units issued after June 30, 1998 in connection the
Contribution Agreement for the Perimeter Park West, Metro Center and Perimeter
Park Land, from the date of the closing of any such contribution until the later
of (x) one year following the date of such closing or (y) the expiration of the
last lock-up period described in clause (i) above, without the prior written
consent of the Company, such Lichtin Holder will not Dispose of directly or
indirectly, to any Person any such Units (or Shares which are exchanged for such
Units) (collectively, the lock-ups described in clauses (i) and (ii) are
referred to as the "Lichtin Holders Lock-up" and the lock-up periods described
in clauses (i) and (ii) are referred to as the "Lichtin Holders Lock-up Period")
(b) Exceptions. The following transfers of Shares or Units shall not be
----------
subject to the Lichtin Holders Lock-up set forth in Section 2(a):
(i) subject to applicable restrictions contained in the Partnership
Agreement, a Lichtin Holder may Dispose of Shares or Units pursuant to a
pledge, grant of security interest or other encumbrance effected in a bona
fide transaction with an unrelated and unaffiliated pledgee;
(ii) subject to applicable exchange restrictions contained in the
Partnership Agreement, a Lichtin Holder may exchange its Units for shares
of Common Stock; and
-4-
<PAGE>
(iii) subject to applicable restrictions contained in the Partnership
Agreement, a Lichtin Holder may Dispose of its Units or Shares pursuant to
a Permitted Private Transfer;
provided, however, that in the case of any transfer of Shares or Units
-------- -------
pursuant to clauses (i) and (iii), the transferee or transferees shall
each be an "accredited investor" within the meaning of Rule 501(a) of
Regulation D under the Securities Act.
In the event a Lichtin Holder Disposes of Shares or Units pursuant to this
Section 2(b), (i) such Shares or Units shall remain subject to this Agreement
and, as a condition of the validity of such disposition, the transferee (and any
pledgee who acquires Shares or Units upon foreclosure or any transferee thereof)
shall be required to execute and deliver a counterpart of this Agreement; and
(ii) if the transferee is an entity in which the transferring Lichtin Holder
owns an interest, then the interest of such Lichtin Holder in such transferee
shall be subject to the Lichtin Holders Lock-up. Thereafter, such transferee
shall be deemed to be a Lichtin Holder for purposes of this Agreement.
3. Piggyback Registrations for the Benefit of the Lichtin Holders.
--------------------------------------------------------------
(a) Right to Piggyback. With respect to any Units issued to Lichtin
------------------
Holders subsequent to June 30, 1998 (or Shares which are exchanged for such
Units), if the Company at any time proposes to register any of its Common Stock
or other securities under the Securities Act for sale to the public, whether for
its own account or for the account of other shareholders or both (except with
respect to registration statements on Form S-8 or another form not available for
registering the Piggyback Registrable Securities for sale to the public) (a
"Piggyback Registration"), the Company will promptly (but in any event within 30
days) give written notice to the Lichtin Holders of its intention to effect such
registration and a description of any underwriting agreement to be entered into
with respect thereto and will include in such registration all Piggyback
Registrable Securities with respect to which the Company has received written
requests for inclusion within 15 days after the receipt of the Company's notice
(a "Piggyback Registration Request"); provided, however, that the Company shall
-------- -------
not be required to include Piggyback Registrable Securities in the securities to
be registered pursuant to a registration statement on any form which limits the
amount of securities which may be registered by the issuer and/or selling
security holders if, and to the extent that, such inclusion would make the use
of such form unavailable. In the event that any Piggyback Registration shall
be, in whole or in part, an underwritten public offering of Common Stock, any
Piggyback Registration Request by the Lichtin Holders shall specify that either
(i) such Piggyback Registrable Securities are to be included in the underwriting
on the same terms and conditions as the shares of Common Stock otherwise being
sold through underwriters under such registration, or (ii) such Piggyback
Registrable Securities are to be sold in the open market without any
underwriting, on terms and conditions comparable to those normally applicable to
offerings of common stock in reasonably similar circumstances.
-5-
<PAGE>
(b) Priority on Primary Registrations. If a Piggyback Registration is an
---------------------------------
underwritten primary registration on behalf of the Company, and the managing
underwriters advise the Company in writing that in their opinion the number of
shares requested to be included in such registration exceeds the Maximum Number,
the Company will limit the number of shares included in such registration to the
Maximum Number, and the shares registered shall be selected in the following
order of priority: (i) first, securities the Company proposes to sell, (ii)
securities requested to be included in such registration pursuant to the
Registration Rights and Lock-Up Agreement dated as of August 24, 1994, by and
among Weeks Corporation and the Company Participants Listed on Schedule A
thereof and the Other Participants Listed on Schedule B thereof, (iii) third,
(a) Piggyback Registrable Securities covered by Piggyback Registration Requests,
(b) securities covered by piggyback registration requests pursuant to the
Registration Rights and Lock-Up Agreement dated as of the date hereof by and
among Weeks Corporation and Harold S. Lichtin, Noel A. Lichtin, Marie A.
Robertson, Amy R. Ehrman, Roland G. Robertson and Perimeter Park West Associates
Limited Partnership, (c) securities covered by piggyback registration requests
pursuant to the Registration Rights and Lock-Up Agreement dated as of November
1, 1996, by and among Weeks Corporation, NWI Warehouse Group, L.P., Buckley &
Company Real Estate, Inc., John W. Nelley, Jr. and Albert W. Buckley, Jr., and
(d) securities covered by piggyback registration requests pursuant to the
Registration Rights and Lock-Up Agreement for Post-March 31, 1998 Shares and
Units dated as of November 1, 1996, by and among Weeks Corporation, NWI
Warehouse Group, L.P. and Buckley & Company Real Estate, Inc., pro rata among
the holders thereof on the basis of the number of shares requested to be
included in such registration, and (iv) fourth, other securities requested to be
included in such registration.
(c) Priority on Secondary Registrations. If a Piggyback Registration is
-----------------------------------
an underwritten secondary registration on behalf of holders of the Company's
securities, and the managing underwriters advise the Company in writing that in
their opinion the number of securities requested to be included in such
registration exceeds the Maximum Number, the Company will include in such
registration the shares requested to be included therein by the holders
requesting such registration and the Piggyback Registrable Securities covered by
Piggyback Registration Requests and any other securities requested to be
included in such registration, pro rata among the holders thereof on the basis
of the number of shares requested to be included in such registration; provided,
--------
however, that if the holders requesting registration are doing so pursuant to
- -------
demand registration rights of such holders, such holders' shares shall take
priority over any Piggyback Registrable Securities and any other securities
requested to be included, which shall be included on a pro rata basis.
4. Holdback Agreements.
-------------------
(a) Lichtin Holders of Piggyback Registrable Securities. Each Lichtin
---------------------------------------------------
Holder agrees not to effect any public sale or distribution (including sales
pursuant to Rule 144) of equity securities of the Company, or any securities
convertible into or exchangeable or exercisable for such securities, during the
7 days prior to (provided that such Lichtin Holder receives a notice from the
Company of the commencement of such 7-day period) and the 90-day period
beginning on the effective date of any underwritten Piggyback Registration in
which Piggyback Registrable Securities are included (except as part of such
-6-
<PAGE>
underwritten registration), unless the underwriters managing the registered
public offering otherwise agree.
(b) Company Officers and Directors. The Company agrees (i) not to effect
------------------------------
any public sale or distribution of its equity securities, or any securities
convertible into or exchangeable or exercisable for such securities, during the
7 days prior to (provided that the Company receives notice of the commencement
of such 7-day period) and the 90-day period beginning on the effective date of
any underwritten Piggyback Registration (except as part of such underwritten
registration or pursuant to registrations on Form S-8 or any successor form),
unless the underwriters managing the registered public offering otherwise agree,
and (ii) to use its commercially reasonable efforts to cause each of the
Company's officers and directors who hold Common Stock or any securities
convertible into or exercisable for Common Stock, to agree not to effect any
public sale or distribution (including sales pursuant to Rule 144) of any such
securities during such period (except as part of such underwritten registration,
if otherwise permitted), unless the underwriters managing the registered public
offering otherwise agree.
5. Piggyback Registration Procedures. If and whenever the Company is
---------------------------------
required to use its reasonable efforts to effect the registration of any of its
securities under the Securities Act, the Company shall use its reasonable and
diligent efforts to effect the registration and sale of the Piggyback
Registrable Securities in accordance with the intended method of disposition
thereof; provided, however, that the Company will not be under any obligation to
-------- -------
ensure the registration of such Piggyback Registrable Securities is consummated
if the Registration Statement pursuant to which the Piggyback Registrable
Securities are being registered is canceled or withdrawn on behalf of the
Company or those persons requesting such registration. In connection with the
foregoing, the Company will, as expeditiously as possible:
(a) prior to the filing of the Registration Statement, furnish to the
selling Lichtin Holders copies of the Registration Statement and any
amendments or supplements thereto and any prospectus forming a part
thereof, which documents shall be subject to the approval of such Lichtin
Holders only with respect to any statement in the Registration Statement
which relates to such Lichtin Holders;
(b) notify the selling Lichtin Holders promptly and confirm in
writing, (i) when the Registration Statement and any post-effective
amendments thereto have become effective, (ii) when any amendment or
supplement to the Prospectus has been filed with the SEC, (iii) of the
issuance by the SEC or any state securities authority of any stop order
suspending the effectiveness of the Registration Statement or any part
thereof or the initiation of any proceedings for that purpose, (iv) if the
Company receives any notification with respect to the suspension of the
qualification of the Piggyback Registrable Securities for offer or sale in
any jurisdiction or the initiation of any proceeding for such purpose, and
(v) of the happening of any event during the period the Registration
Statement is effective as a result of which (A) such Registration
Statement contains any untrue statement of a material fact or omits to
-7-
<PAGE>
state any material fact required to be stated therein or necessary to make
the statements therein not misleading or (B) the Prospectus as then
amended or supplemented contains any untrue statement of a material fact
or omits to state any material fact necessary in order to make the
statements therein, in light of the circumstances under which they were
made, not misleading;
(c) make every reasonable effort to obtain the withdrawal of any order
suspending the effectiveness of the Registration Statement or any part
thereof as promptly as possible;
(d) after the Lichtin Holders have delivered a Piggyback Registration
Request to the Company, furnish to each selling Lichtin Holder, without
charge, at least one conformed copy of the Registration Statement and any
post-effective amendment thereto (without documents incorporated therein
by reference or exhibits thereto, unless requested);
(e) prepare and file with the SEC such amendments and supplements to
such Registration Statement and the Prospectus used in connection
therewith as may be necessary to keep such Registration Statement
effective for the period specified in paragraph (a) above and to comply
with the provisions of the Securities Act with respect to the disposition
of all Piggyback Registrable Securities covered by such Registration
Statement in accordance with each Lichtin Holder's intended method of
disposition set forth in such Registration Statement for such period;
(f) furnish to each selling Lichtin Holder and to each underwriter
such number of copies of the Registration Statement and the Prospectus
included therein (including each preliminary prospectus) and such other
documents, as such persons may reasonably request in order to facilitate
the public sale or other disposition of the Piggyback Registrable
Securities covered by such Registration Statement;
(g) use its reasonable and diligent efforts to register or qualify the
Piggyback Registrable Securities covered by such Registration Statement
under the securities or blue sky laws of such jurisdictions as the Lichtin
Holders or, in the case of an underwritten public offering, the managing
underwriter, shall reasonably request;
(h) provide a transfer agent and registrar, which may be a single
entity, for all Piggyback Registrable Securities not later than the
effective date of the Registration Statement;
(i) use its reasonable and diligent efforts to cause all Piggyback
Registrable Securities to be listed on any securities exchange on which
similar securities issued by the Company are then listed;
-8-
<PAGE>
(j) if the offering is underwritten, to furnish, at the request of the
Lichtin Holders, on the date that Piggyback Registrable Securities are
delivered to the underwriters for sale pursuant to such registration: (i)
an opinion dated such date of counsel representing the Company for the
purposes of such registration, addressed to the underwriters, stating that
such Registration Statement has become effective under the Securities Act
and that (A) to the best knowledge of such counsel, no stop order
suspending the effectiveness thereof has been issued and no proceedings
for that purpose have been instituted or are pending or contemplated under
the Securities Act, (B) the Registration Statement, the related
Prospectus, and each amendment or supplement thereto, comply as to form in
all material respects with the requirements of the Securities Act and the
applicable rules and regulations of the SEC thereunder and that such
counsel does not believe that any such Registration Statement, Prospectus,
amendment or supplement contains a misstatement of a material fact or an
omission to state a material fact required to be stated therein or
necessary to make the statements made therein, in light of the
circumstances under which they were made, not misleading (except that such
counsel need express no opinion as to financial statements or financial or
statistical data contained therein) and (C) to such other effects as may
reasonably be requested by counsel for the underwriters or by the Lichtin
Holders or their counsel, and (ii) a letter dated such date from the
independent public accountants retained by the Company, addressed to the
underwriters, stating that they are independent public accountants within
the meaning of the Securities Act and that, in the opinion of such
accountants, the financial statements of the Company included in the
Registration Statement or the Prospectus, or any amendment or supplement
thereto, comply as to form in all material respects with the applicable
accounting requirements of the Securities Act, and such letter shall
additionally cover such other financial matters (including information as
to the period ending no more than five business days prior to the date of
such letter) with respect to the registration in respect of which such
letter is being given as such underwriters may reasonably request;
(k) after the Lichtin Holders have provided a Piggyback Registration
Request to the Company, make available for inspection by each Lichtin
Holder and any counsel, accountants or other representatives retained by
such Lichtin Holder all financial and other records, pertinent corporate
documents and properties of the Company and cause the officers, directors
and employees of the Company to supply all such records, documents or
information reasonably requested by such Lichtin Holder, counsel,
accountants or representatives in connection with the Registration
Statement; provided, however, that such records, documents or information
-------- -------
which the Company determines in good faith to be confidential and notifies
such Lichtin Holder, counsel, accountants or representatives in writing
that such records, documents or information are confidential shall not be
disclosed by Lichtin Holders, counsel, accountants or representatives
unless (i) such disclosure is ordered pursuant to a subpoena or other
order from a court of competent jurisdiction or governmental agency, or
(ii) such records, documents or information become generally available to
the public other than through a breach of this Agreement; and
-9-
<PAGE>
(l) cooperate with each selling Lichtin Holder to facilitate the
timely preparation and delivery of certificates representing Piggyback
Registrable Securities to be sold and not bearing any Securities Act
legend; and enable certificates for such Piggyback Registrable Securities
to be issued for such numbers of shares as each Lichtin Holder may
reasonably request at least two business days prior to any sale of
Piggyback Registrable Securities.
For purposes of paragraph (e) of this Section 5, the period of
distribution of Piggyback Registrable Securities in a firm commitment
underwritten public offering shall be deemed to be that period during which the
underwriters in such offering require in an underwriting agreement in the form
customarily used by such underwriters for comparable transactions that the
Company keep a registration statement effective to permit each underwriter to
complete the distribution of all securities purchased by it, and the period of
distribution of Piggyback Registrable Securities in any other registration shall
be deemed to extend until the earlier of the sale of all Piggyback Registrable
Securities covered thereby or nine months after the effective date thereof.
In connection with each registration hereunder, each selling Lichtin
Holder will furnish to the Company in writing such information with respect to
itself and the proposed distribution by its members as shall be reasonably
necessary in order to assure compliance with federal and applicable state
securities laws. Reasonable compliance with the obligation to furnish such
information shall be a condition to the rights afforded each Lichtin Holder
hereunder. In addition, each selling Lichtin Holder and any of its beneficial
owners, officers, directors or affiliates, if any, (i) will comply with the
provisions of Rule 10b-6 and 10b-7 under the Exchange Act as applicable to them
in connection with sales of Piggyback Registrable Securities pursuant to the
Registration Statement; (ii) will comply with the prospectus delivery
requirements of the Securities Act as applicable to them in connection with
sales of Piggyback Registrable Securities pursuant to the Registration
Statement; and (iii) will enter into such written agreements as the Company
shall reasonably request to ensure compliance therewith.
In connection with each registration pursuant to Section 3 hereof covering
an underwritten public offering, the Company agrees to enter into a written
agreement with the managing underwriter selected in the manner herein provided
in such form and containing such provisions as are customary in the securities
business for such an arrangement between major underwriters and companies of the
Company's size and investment stature; provided that such agreement shall not
--------
contain any such provision applicable to the Company which is inconsistent with
the provisions hereof; provided, further that the time and place of the closing
-------- -------
under said agreement shall be as mutually agreed upon between the Company and
such managing underwriter.
6. Piggyback Registration Expenses. In connection with any Piggyback
-------------------------------
Registration, the Company shall pay all Piggyback Registration Expenses and the
selling Lichtin Holders shall pay all Selling Expenses applicable to the shares
sold by such Lichtin Holders.
7. Indemnification; Contribution.
-----------------------------
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<PAGE>
(a) Indemnification by the Company. The Company agrees to indemnify and
------------------------------
hold harmless each Lichtin Holder and the beneficial owners, officers and
directors and each Person, if any, who controls each Lichtin Holder within the
meaning of Section 15 of the Securities Act as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to which each Lichtin Holder, or any beneficial
owner, officer, director or controlling Person may become subject under the
Securities Act or otherwise (A) that arise out of or are based upon any
untrue statement or alleged untrue statement of a material fact contained
in the Registration Statement or any amendment thereto, or the omission or
alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading or (B)
that arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in any Prospectus or any amendment
or supplement thereto, or the omission or alleged omission to state therein
a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or alleged untrue
statement or any omission or alleged omission, if such settlement is
effected with the written consent of the Company; and
(iii) subject to the limitations set forth in Section 7(c), against
any and all expense whatsoever, as incurred (including reasonable fees and
disbursements of counsel), reasonably incurred in investigating, preparing
or defending against any litigation, or investigation or proceeding by any
governmental agency or body, commenced or threatened, in each case whether
or not a party, or any claim whatsoever based upon any such untrue
statement or alleged untrue statement or omission or alleged omission, to
the extent that any such expense is not paid under subparagraph (i) or (ii)
above;
provided, however, that the indemnity provided pursuant to this Section 7(a)
- -------- -------
shall not apply with respect to any loss, liability, claim, damage or expense
that arise out of or are based upon any untrue statement or alleged untrue
statement or omission or alleged omission made in reliance upon and in
conformity with written information furnished to the Company by any Lichtin
Holder (i) expressly for use in the Registration Statement or any amendment
thereto, or the Prospectus or any amendment or supplement thereto or (ii)
pursuant to any representation, warranty or other statement contained in any of
the Contribution Agreements or any admission amendment to the Partnership
Agreement.
(b) Indemnification by the Lichtin Holders. Each Lichtin Holder severally
--------------------------------------
agrees to indemnify and hold harmless the Company, and each of its respective
directors and officers (including each director and officer of the Company who
signed the Registration Statement), and each Person, if any, who controls the
-11-
<PAGE>
Company within the meaning of Section 15 of the Securities Act, to the same
extent as the indemnity contained in Section 7(a) hereof, but only insofar as
such loss, liability, claim, damage or expense arises out of or is based upon
any untrue statement or alleged untrue statement or omission or alleged omission
made in the Registration Statement or any amendment thereto, or the Prospectus
or any amendment or supplement thereto, or any of the Contribution Agreements,
in reliance upon and in conformity with written information furnished to the
Company by such Lichtin Holder expressly for use therein. In no event, however
shall the liability of a Lichtin Holder exceed the cumulative net proceeds
received by such Lichtin Holder from any offering made in connection with a
Registration Statement.
(c) Conduct of Indemnification Proceedings. Each indemnified party shall
--------------------------------------
give reasonably prompt notice to each indemnifying party of any action or
proceeding commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party (i) shall not relieve
it from any liability which it may have under the indemnity agreement provided
in Section 7(a) or (b) above, unless and to the extent it did not otherwise
learn of such action and the lack of notice by the indemnified party materially
prejudices the indemnifying party or results in the forfeiture by the
indemnifying party of substantial rights and defenses and (ii) shall not, in any
event, relieve the indemnifying party from any obligations to any indemnified
party other than the indemnification obligation provided under Section 7(a) or
(b) above. After receipt of such notice, the indemnifying party shall be
entitled to participate in and, to the extent it shall wish, jointly with any
other indemnifying party so notified, to assume the defense of such action or
proceeding at such indemnifying party's own expense with counsel chosen by such
indemnifying party and approved by the indemnified party, which approval shall
not be unreasonably withheld; provided, however, that, if the defendants in any
-------- -------
such action or proceeding include both the indemnified party and the
indemnifying party and the indemnified party reasonably determines, upon advice
of counsel, that a conflict of interest exists or that there may be legal
defenses available to it or other indemnified parties that are different from or
in addition to those available to the indemnifying party, then the indemnified
party shall be entitled to separate counsel (which shall be limited to a single
law form), the reasonable fees and expenses of which shall be paid by the
indemnifying party. If the indemnifying party does not assume the defense of
any such action or proceeding, after having received the notice referred to in
the first sentence of this paragraph, the indemnifying party will pay the
reasonable fees and expenses of counsel (which shall be limited to a single law
firm) for the indemnified party. In such event, however, the indemnifying party
will be liable for any settlement effected without the written consent of such
indemnifying party. If the indemnifying party assumes the defense of any such
action or proceeding in accordance with this paragraph, such indemnifying party
shall not be liable for any fees and expenses of counsel for the indemnified
party incurred thereafter in connection with such action or proceeding, except
as set forth in the proviso in the second sentence of this Section 7(c).
(d) Contribution. In order to provide for just and equitable contribution
------------
in circumstances in which the indemnity agreement provided for in this Section 7
is for any reason held to be unenforceable although applicable in accordance
with its terms, the Company and the selling Lichtin Holders shall contribute to
the aggregate losses, liabilities, claims, damages and expenses of the nature
-12-
<PAGE>
contemplated by such indemnity agreement incurred by the Company and the selling
Lichtin Holders, in such proportion as is appropriate to reflect the relative
fault of and benefits to the Company on the one hand and the selling Lichtin
Holders on the other (in such proportion that the selling Lichtin Holders are
severally, not jointly, responsible for the balance), in connection with the
statements or omissions which resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable considerations.
The relative benefits to the indemnifying party and indemnified parties shall
be determined by reference to, among other things, the total proceeds received
by the indemnified party and indemnified parties in connection with the offering
to which such losses, claims, damages, liabilities or expenses relate. The
relative fault of the indemnifying party and indemnified parties shall be
determined by reference to, among other things, whether the action in question,
including any untrue or alleged untrue statement of a material fact or omission
or alleged omission to state a material fact, has been made by, or relates to
information supplied by, such indemnifying party or the indemnified parties, and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such action.
The parties hereto agree that it would not be just or equitable if
contribution pursuant to this Section 7(d) were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 7(d), a Lichtin Holder shall not
be required to contribute any amount in excess of the amount by which the total
price at which the Piggyback Registrable Securities of such Lichtin Holder were
offered to the public exceeds the amount of any damages which such Lichtin
Holder would otherwise have been required to pay by reason of such untrue
statement or omission.
Notwithstanding the foregoing, no Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section 7(d), each Person,
if any, who controls any Lichtin Holder within the meaning of Section 15 of the
Securities Act and beneficial owners, directors and officers of any Lichtin
Holder shall have the same rights to contribution as any member of the Lichtin
Holders, and each director of the Company, each officer of the Company who
signed the Registration Statement, and each Person, if any, who controls the
Company within the meaning of Section 15 of the Securities Act shall have the
same rights to contribution as the Company.
(e) In the event any sale pursuant to a Piggyback Registration is an
underwritten offering, then the Company agrees to indemnify and hold harmless
each underwriter of Piggyback Registerable Securities to the same extent and on
substantially similar terms as the Company's indemnification of the members of
the Lichtin Holders as set forth in Section 7(a) above.
8. Rule 144 Sales.
--------------
-13-
<PAGE>
(a) Compliance. The Company covenants that, so long as it is subject to
----------
the reporting requirements of the Exchange Act, it will file the reports
required to be filed by it under the Exchange Act so as to enable Lichtin
Holders to sell Piggyback Registrable Securities pursuant to Rule 144 under the
Securities Act.
(b) Cooperation with the Lichtin Holders. In connection with any sale,
------------------------------------
transfer or other disposition by a Lichtin Holder of any Piggyback Registrable
Securities pursuant to Rule 144 under the Securities Act, the Company shall
cooperate with such Lichtin Holder to facilitate the timely preparation and
delivery of certificates representing Piggyback Registrable Securities to be
sold and not bearing any Securities Act legend, and enable certificates for such
Piggyback Registrable Securities to be for such number of shares as such Lichtin
Holder may reasonably request at least two business days prior to any sale of
Piggyback Registrable Securities.
9. Miscellaneous.
-------------
(a) Amendments and Waivers. The provisions of this Agreement, including
----------------------
the provisions of this sentence, may not be amended, modified, supplemented or
waived, nor may consent to departures therefrom be given, without the written
consent of the Company and the Lichtin Holders.
(b) Notices. All notices and other communications provided for or
-------
permitted hereunder shall be made in writing by hand-delivery, registered first-
class mail, telex, telecopier, or any courier guaranteeing overnight delivery,
(i) if to the Lichtin Holders, at each of the addresses on the attached
signature pages or (ii) if to the Company, at 4497 Park Drive, Norcross, Georgia
30093, Attention: A. R. Weeks, Jr.
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five business
days after being deposited in the mail, postage prepaid, if mailed; when
answered back, if telexed; when receipt is acknowledged, if telecopied; or at
the time delivered if delivered by an air courier guaranteeing overnight
delivery.
(c) Successors and Assigns. This Agreement shall inure to the benefit of
----------------------
and be binding upon the successors, assigns and transferees of each of the
parties. If any successor, assignee or transferee of any Lichtin Holder shall
acquire Piggyback Registrable Securities, in any manner, whether by operation of
law or otherwise, such Piggyback Registrable Securities shall be held subject to
all of the terms of this Agreement, and by taking and holding such Piggyback
Registrable Securities such Person shall be entitled to receive the benefits
hereof and shall be conclusively deemed to have agreed to be bound by all of the
terms and provisions hereof.
(d) Third Party Beneficiaries. There shall be no third party beneficiaries
-------------------------
or intended beneficiaries of this Agreement
-14-
<PAGE>
(e) Counterparts. This Agreement may be executed in any number of
------------
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(f) Headings. The headings in this Agreement are for convenience of
--------
reference only and shall not limit or otherwise affect the meaning hereof.
(g) Governing Law. This Agreement shall be governed by and construed in
-------------
accordance with the laws of the State of Georgia without giving effect to the
conflicts of law provisions thereof.
(h) Specific Performance. The parties hereto acknowledge that there would
--------------------
be no adequate remedy at law if any party fails to perform any of its
obligations hereunder, and accordingly agree that each party, in addition to any
other remedy to which it may be entitled at law or in equity, shall be entitled
to compel specific performance of the obligations of any other party under this
Agreement in accordance with the terms and conditions of this Agreement in any
court of the United States or any State thereof having jurisdiction.
(i) Entire Agreement. This Agreement is intended by the parties as a final
----------------
expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein. This Agreement supersedes all prior
agreements and understandings between the parties with respect to such subject
matter.
-15-
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above
WEEKS CORPORATION
By:
---------------------------------------
Name:
Title:
HAROLD S. LICHTIN
--------------------------------------------
Address: 1800 Perimeter Park Drive
Suite 200
Morrisville, NC 27560
NOEL A. LICHTIN
--------------------------------------------
Address: 1800 erimeter Park Drive
Suite 200
Morrisville, NC 27560
MARIE A. ROBERTSON
--------------------------------------------
Address: c/o First Rock, Inc.
1525 The 600 Building
Corpus Christi, Texas 78473
-16-
<PAGE>
AMY R. EHRMAN
--------------------------------------------
Address: c/o First Rock, Inc.
1525 The 600 Building
Corpus Christi, Texas 78473
ROLAND G. ROBERTSON
----------------------------------------------
Address: c/o First Rock, Inc.
1525 The 600 Building
Corpus Christi, Texas 78473
PERIMETER PARK WEST ASSOCIATES
LIMITED PARTNERSHIP, a North Carolina
limited partnership
By:
-------------------------------------------
Harold S. Lichtin, General Partner
By:
-------------------------------------------
Marie Antoinette Robertson, General Partner
Address: 1800 Perimeter Park Drive
Suite 200
Morrisville, NC 27560
-17-
<PAGE>
EMPLOYMENT AGREEMENT
--------------------
THIS EMPLOYMENT AGREEMENT (this "Agreement"), is made and entered into on
this 31st day of December, 1996, by and between HAROLD S. LICHTIN, an individual
resident of the State of North Carolina (the "Executive"), and WEEKS
CORPORATION, a Georgia corporation ("the Company");
W I T N E S S E T H:
--------------------
WHEREAS, the Company desires to employ Executive, and Executive desires to
be employed by the Company, on the terms and conditions contained in this
Agreement;
NOW, THEREFORE, in consideration of the mutual promises and agreements
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties to this Agreement,
intending to be legally bound, hereby agree as follows:
(S) 1.
Employment
----------
1.1 Employment. Subject to the terms of this Agreement, the Company hereby
----------
employs Executive, and Executive hereby accepts such employment with the
Company. During the term of Executive's employment under this Agreement,
Executive shall serve as Managing Director of the Company and President and
Chief Executive Officer of Weeks/Lichtin, a division of the Company, and shall
have all the duties, rights, and responsibilities normally associated with such
position, including, without limitation, day-to-day responsibility for the
Company's operations in the Raleigh-Durham-Chapel Hill area of North Carolina,
together with such other reasonable duties relating to the operation of the
business of the Company as may be assigned to him from time to time by the Board
of Directors or other governing body of the Company. Executive shall devote his
full business time, skills, and best efforts to rendering services on behalf of
the Company and shall exercise such care as is customarily required of
executives undertaking similar duties for entities similar to the Company.
Notwithstanding the foregoing, Executive may engage in the business activities
listed with respect to this Section 1.1 on Exhibit A hereto.
---------
1.2 Appointment to the Board, Investment Committee and Chairman's Office.
--------------------------------------------------------------------
On the Effective Date (as defined in (S) 3.1), Executive shall be appointed a
member of (i) the Board of Directors of the Company, Weeks GP Holdings, Inc. and
<PAGE>
Weeks LP Holdings, Inc., (ii) the Investment Committee of the Company, and (iii)
the Chairman's Office of the Company. It is the intent of the parties that
Executive's service in such positions will keep Executive thoroughly informed
with respect to the activities of the Company and actively involved in the short
and long term overall strategic planning for the Company. Executive and the
Company shall use their reasonable good faith efforts to cause Executive to be
included in all formal and informal meetings, sessions and discussions of or
among the members of the Board of Directors, the Investment Committee and the
Chairman's Office.
1.3 License to Use "Lichtin" Name. So long as Executive is employed by
-----------------------------
the Company, Executive hereby grants to the Company a royalty-free, non-
exclusive license to use, including a right to sublicense to affiliates of the
Company, the names "Lichtin", "Lichtin Properties", and any derivations thereof
for the sole purpose of (i) promoting the leasing and marketing of the Company's
office, warehouse, and research and development space in and around Wake County
and the Research Triangle area and (ii) the Company's property management
services; provided, however, if Executive ceases to be employed by the Company
because of a For Cause Termination (as provided for in Section 3.2(b) hereof),
the term of the license granted in this Section 1.3 shall continue so long as
Executive is bound by the terms of that certain Noncompetition Agreement by and
between Executive and the Company (as therein defined) of even date herewith.
The Company acknowledges and agrees that Executive is the sole and exclusive
owner of the right to use the name "Lichtin", "Lichtin Properties", and the
derivations thereof and logos embodying such names and all of the good will
associated therewith and that the same shall remain at all times the sole and
exclusive property of Executive. All use by the Company of the names "Lichtin",
"Lichtin Properties", and the derivations thereof, and any logos in connection
therewith shall be deemed to inure exclusively to the benefit of Executive. To
the extent that any rights in or to the name or any logo used in connection
therewith or any aspect thereof are deemed to accrue to the Company, the Company
hereby irrevocably assigns any and all such rights, at such time as they may be
deemed to accrue, including any and all related good will, to Executive. The
Company further agrees that it will not apply to, register, use or claim any
rights in the name or any aspects thereof (including the good will related
thereto) except to the limited extent provided herein.
(S) 2.
Compensation; Expenses
----------------------
2.1 Base Salary. Commencing on the Effective Date (as defined in (S) 3.1),
-----------
the Company shall pay Executive a base salary equal to $65,000 per annum and
commencing on January 1, 1998, the Company shall pay Executive during the
remaining term of Executive's employment under this Agreement a base salary
equal to $190,000 per annum (the "Base Salary"), which amount shall be subject
to adjustment, if any, in accordance with this (S) 2.1. The Compensation
Committee of the Board of Directors or other governing body of the Company (the
"Committee") shall review Executive's Base Salary on an annual basis, and the
Committee, upon such review and in its sole discretion, may increase or decrease
-2-
<PAGE>
Executive's Base Salary in accordance with criteria to be established by the
Committee; provided, however, that Executive's Base Salary shall not be reduced
below $65,000 before January 1, 1998 or below $190,000 on or after January 1,
1998; and provided further, however, that such criteria shall be determined
primarily on the basis of growth in the Company's revenues and funds from
operations per share of capital stock, on the performance of the business units
which are under the management and supervision of Executive and on the basis of
the satisfaction of other employment goals established by the Committee. The
Base Salary, less all applicable withholding taxes, shall be paid to Executive
in accordance with the payroll procedures in effect from time to time with
respect to executive officers of the Company.
2.2 Incentive Compensation. Commencing on the Effective Date, Executive
----------------------
shall be entitled to participate in any incentive compensation plans in effect
with respect to executive officers of the Company, with the criteria for
Executive's participation in such plans to be established by the Committee in
its sole discretion; provided, however, that such incentive compensation for any
year will not exceed 75% of the Base Salary for such year; provided further,
that the Base Salary for 1997 for purposes of the foregoing limitation shall be
deemed to be $190,000.
2.3 Stock Options. Executive shall be entitled to participate in such
-------------
employee stock option plans as are from time to time established for the benefit
of employees of the Company in accordance with the terms and conditions of such
plans. At the Effective Date, Executive shall be granted immediately vested and
exercisable options to purchase 40,000 shares of the Company's common stock, par
value $.01 per share, in accordance with the Weeks Corporation Incentive Stock
Plan as in effect on the Effective Date. The exercise price of each such option
shall be the fair market value of the Company's common stock as of the Effective
Date. Such options shall remain exercisable until the earlier of (i) ten (10)
years from the date of grant or (ii) six (6) months from Executive's termination
of employment with the Company for any reason.
2.4 Expenses. Executive shall be reimbursed for all reasonable business-
--------
related expenses incurred by Executive at the request of or on behalf of the
Company, including, without limitation, first class travel expenses incurred in
connection with the performance of Executive's duties and responsibilities
hereunder.
2.5 Participation in Employee Benefit Plans. Executive shall be entitled to
---------------------------------------
participate in such medical, dental, disability, hospitalization, life
insurance, profit sharing, and other benefit plans as the Company shall maintain
from time to time for the benefit of executive officers of the Company, on the
terms and subject to the conditions set forth in such plans.
2.6 Vacation. In addition to Company holidays, Executive shall receive such
--------
paid vacation time each year during the term of this Agreement as is consistent
with vacation policies of the Company for its executive officers, but in no
event less than six weeks of paid vacation time annually. Any unused vacation
days in any year may not be carried over to subsequent years and Executive shall
not receive any additional compensation for unused vacation days.
-3-
<PAGE>
2.7 Automobile Allowance. Commencing on the Effective Date, during the term
--------------------
of Executive's employment under this Agreement, the Company shall pay Executive
an automobile allowance of $600.00 per month.
(S) 3.
Term of Employment
------------------
3.1 Term of Employment. Unless earlier terminated in accordance with
------------------
(S) 3.2, the employment of Executive under this Agreement shall commence as of
the date that this Agreement is executed (the "Effective Date") and shall
continue up to, but not including, the third anniversary of such date.
Thereafter, Executive's employment under this Agreement shall be extended for
such period, if any, as agreed to in writing by Executive and the Company.
3.2 Termination. Executive's employment under this Agreement may be
-----------
terminated
(a) by the Company upon the death or total disability of Executive (total
disability meaning the inability of Executive to perform his normal required
services under this Agreement for a period of six consecutive months during
the term of this Agreement by reason of Executive's mental or physical
disability, as reasonably determined by the Board of Directors or other
governing body of the Company) (which shall be referred to as a "Disability
Termination"); or
(b) by the Company for "cause," which shall exist only upon the occurrence
of one or more of the following: (i) Executive is convicted of, pleads guilty
to, or confesses to any felony or any act of fraud, misappropriation or
embezzlement to the material damage or prejudice of the Company or any
affiliate of the Company, as determined by the Board of Directors or other
governing body of the Company in good faith, or (ii) Executive engages in a
fraudulent act relating to the business of the Company or any affiliate of the
Company, as determined by the Board of Directors or other governing body of
the Company in good faith (which shall be referred to individually and
collectively as a "For Cause Termination"); or
(c) by the Company for any reason other than a For Cause Termination or a
Disability Termination (which shall be referred to as a "No Cause
Termination"); or
(d) by Executive voluntarily for any reason other than an Employee-
Initiated Termination (as defined in (S) 3.2(e)) after giving 30 days prior
written notice to the Company (which shall be referred to as a "Voluntary
Termination"); or
(e) by Executive for "cause", which shall exist if the Company fails to
cure within ten days after receiving notice from Executive of the occurrence
of any of the following: (i) Executive is required to move more than 20 miles
-4-
<PAGE>
from the city limits of Raleigh, North Carolina without his consent, (ii)
there is a material change by the Company in Executive's functions, duties or
responsibilities which cause the ranking or level, dignity, responsibility,
importance or scope of Executive's position with the Company to become of less
dignity, responsibility, importance or scope from the position and the
attributes thereof described in (S) 1.1, (iii) Executive fails to be nominated
by the Company for reelection as a member of the Board of Directors of the
Company, the Board of Directors of Weeks GP Holdings, Inc., the Board of
Directors of Weeks LP Holdings, Inc., the Investment Committee of the Company
or the Chairman's Office of the Company, (iv) there is a decrease in
Executive's Base Salary, or (v) there is a material decrease in the value of
Executive's benefits package provided by the Company (as described in (S)
4.2(iv)) without his consent (which shall be referred to as an "Employee-
Initiated Termination").
(S) 4.
Results of Termination
----------------------
4.1 Termination As Result of Voluntary Termination or For Cause
-----------------------------------------------------------
Termination. If Executive's employment under this Agreement is terminated as a
- -----------
result of a Voluntary Termination or a For Cause Termination, Executive shall
not thereafter be entitled to receive any Base Salary for periods following such
termination and shall not be entitled to receive any incentive, bonus or other
special compensation with respect to the year in which such termination occurs
or for any period thereafter; provided, however, that Executive shall be
entitled to receive any Base Salary and expense reimbursements that may be owed
to Executive but are unpaid as of the date on which Executive's employment is
terminated.
4.2 Termination As Result of No Cause Termination or Employee-Initiated
-------------------------------------------------------------------
Termination. If Executive's employment under this Agreement is terminated as a
- -----------
result of a No Cause Termination or an Employee-Initiated Termination, Executive
shall be entitled to receive (i) any Base Salary and expense reimbursements that
may be owed to Executive but are unpaid as of the date on which Executive's
employment is terminated, (ii) additional compensation equal to any amount
Executive would have received (with respect to the year in which the termination
occurs) under any and all incentive, bonus, and other special compensation plans
and arrangements in which Executive is a participant at the date of termination,
multiplied by a fraction, the numerator of which is the number of days that have
elapsed in such year through the date of termination, and the denominator of
which is 365, (iii) additional compensation equal to the total Base Salary
Executive would have received (assuming the Base Salary as in effect on the date
of such termination; provided, however, if the date of such termination is prior
to January 1, 1998, for purposes of computing such additional compensation, the
Base Salary in effect for periods beginning on or after January 1, 1998 shall
not be less than $190,000) for the period from the date of termination up to,
but not including, the third anniversary of the Effective Date, or, if later,
through the remainder of his term of employment under any extension of this
Agreement, and (iv) continuation of the benefits (e.g., medical insurance and
life insurance) at the same premium cost to Executive, and at the same coverage
levels as in effect on the date of such termination for the period from the date
of termination up to, but not including, the third anniversary of the Effective
-5-
<PAGE>
Date, or, if later, through the remainder of his term of employment under any
extension of this Agreement, and at the end of such period, Executive shall be
entitled to elect continued medical coverage in accordance with the coverage
continuation provisions of Sections 601 et seq. of the Employee Retirement
Income Security Act of 1974, as amended. The compensation referred to in (i)
and (iii) above shall be paid, in equal installments, at the same times
Executive would have received salary payments had he remained an employee,
unless the Company elects to make such payments (without discount for early
payment) sooner. The compensation and benefits referred to in (ii) above shall
be paid at the same time or times as payments would have been made to Executive
under the applicable incentive, bonus or other special compensation arrangements
had he remained an employee. The compensation referred to in (i), (ii), (iii),
and (iv) above shall constitute the sole and exclusive remaining compensation
due to Executive hereunder. Executive shall not be obligated to seek other
employment in mitigation of the compensation and benefits payable under this (S)
4.2, and the obtaining of any such other employment (provided that Executive
otherwise complies with the terms of the Noncompetition Agreement between
Executive and the Company dated as of the date hereof) shall in no way effect
any reduction of the Company's obligations to make the payments required to be
made under (S) 4.2.
4.3 Termination as a Result of a Disability Termination Event. If
---------------------------------------------------------
Executive's employment under this Agreement is terminated as a result of a
Disability Termination, (i) Executive shall be entitled to receive any Base
Salary that may be owed to Executive but is unpaid as of the date on which
Executive's employment is terminated, and (ii) Executive (or at his death, his
designated beneficiary, if any, or if none, his surviving spouse or, if none,
his estate) shall continue to receive Executive's Base Salary for the month in
which such termination occurs and for the following six months. If payment of
Base Salary is to be made to Executive's estate, such payment shall be made as
soon as practical after Executive's death in a single lump sum (without discount
for early payment) equal to the total amount of Base Salary payable to the
estate.
4.4 Other Employee Benefit Plans and Arrangements. The benefits, if any,
---------------------------------------------
payable to or on behalf of Executive upon his termination of employment from the
Company under any other employee benefit plans and arrangements not specifically
provided for herein shall be governed by the terms and conditions for benefit
payments set forth in such plans and arrangements.
(S) 5.
Miscellaneous
-------------
5.1 Allocation of Income. Executive hereby acknowledges that the Company
--------------------
and its related affiliates may allocate certain portions of Executive's
compensation among the Company and its affiliates. Executive agrees to such
allocation and acknowledges that for purposes of this Agreement, Executive will
be deemed to be employed by, and to perform services for, the entity to which
such compensation is allocated.
-6-
<PAGE>
5.2 Binding Effect. This Agreement shall inure to the benefit of and shall
--------------
be binding upon Executive and his executor, administrator, heirs, personal
representative and assigns, and the Company and its successors and assigns;
provided, however, that Executive shall not be entitled to assign or delegate
any of his rights or obligations hereunder without the prior written consent of
Company.
5.3 Construction of Agreement. No provision of this Agreement or any
-------------------------
related document shall be construed against or interpreted to the disadvantage
of any party hereto by any court or other governmental or judicial authority by
reason of such party having or being deemed to have structured or drafted such
provision.
5.4 Arbitration of Disputes. If a dispute arises between the parties, then
-----------------------
the parties agree that their respective representatives shall meet and consult
in good faith and attempt to settle the dispute, within thirty (30) days of
written notice thereof, as a condition precedent to the initiation of
arbitration proceedings as set forth below.
Any dispute, controversy, or claim arising out of or relating to this
Agreement, the breach, termination or invalidity thereof, or Executive's
employment, including claims of tortious interference or other tort or statutory
claims, and including without limitation any dispute concerning the scope of
this arbitration clause, shall be settled by arbitration in accordance with the
Employment Dispute Arbitration Rules of the American Arbitrators Association
then in effect. The judgment on the award rendered by the arbitrator may be
entered in any court having jurisdiction thereof. The arbitration under this
Agreement shall be held in Raleigh, North Carolina, or at such other place as
may be selected by mutual agreement of the parties.
The arbitrator shall be mutually acceptable to the parties, or failing
agreement, selected pursuant to the Employment Dispute Arbitration Rules of the
American Arbitrators Association. The parties intend that the arbitrator shall
be independent and impartial. To this end, the arbitrator shall disclose to the
parties any professional, family, or social relationships, past or present, with
any party or counsel.
Strict rules of evidence shall not apply in any arbitration conducted
pursuant to this Agreement. The parties may offer such evidence as they desire
and the arbitrator shall accept such evidence as the arbitrator deems relevant
to the issues and accord it such weight as the arbitrator deems appropriate.
The arbitrator shall have the discretion to order a prehearing exchange of
information by the parties, including without limitation, production of
requested documents, exchange of summaries of testimony of proposed witnesses,
and examination by deposition of parties. No party shall be allowed, however,
to take more than one deposition of the opposing party and no deposition shall
last longer than six (6) hours. All disputes regarding discovery shall be
decided by the arbitrator.
-7-
<PAGE>
The arbitrator award shall be in writing and shall specify the factual and
legal bases for the award. In rendering the award, the arbitrator shall
determine the respective rights and obligations of the parties according to the
laws of the State of North Carolina or, if applicable, federal law. The
arbitrator shall have the authority to award any remedy or relief that a federal
or state court within the State of North Carolina could order or grant.
Any provisional remedy that would be available from a court of law shall be
available from the arbitrator to the parties, pending the arbitrator's
determination of the merits of the parties' dispute. This shall include orders
of attachment, temporary restraining orders, injunctions, and appointment of a
receiver. If the arbitrator issues such an order, either party may immediately
apply to a court of competent jurisdiction for enforcement of the order, even
though the arbitrator may not have rendered a final award.
All fees and expenses of the arbitration, including the fees of the
arbitrator and the expense of each parties' counsel, experts, witnesses and
preparation and presentation of proofs, shall be paid by Company.
Unless legally required to do so, neither party may disclose the existence,
content, or results of any arbitration under this Agreement without the prior
written consent of the other party, nor may the arbitrator disclose any such
information without the consent of both parties. This provision shall apply to
all aspects of the arbitration proceeding, including without limitation,
discovery, testimony, other evidence, briefs, and the award.
It is the specific intent of the parties that this arbitration clause be
governed by the Federal Arbitration Act, 9 U.S.C. Section 1 et. seq. ("FAA");
however, if this cause is unenforceable for any reason under the FAA, then the
parties intend that it be governed by the provisions of the Uniform Arbitration
Act, N.C. Gen. Stat. (S)(S) 1-567.1 through 1-567.20.
-8-
<PAGE>
Both Executive and Company represent and warrant they have read the
foregoing Section 5.3, that they have had an opportunity to consult with and
receive advice from legal counsel regarding the foregoing Section 5.3, and that
they hereby forever waive all rights to assert that this Section 5.3 was the
result of duress, coercion, or mistake of law or fact.
_____ _____ (Initial of both parties in each space).
5.5 Governing Law. This Agreement shall be governed by and construed in
-------------
accordance with the laws of the State of North Carolina, not including the
choice of law rules thereof.
5.6 Survival of Agreements. All covenants and agreements made herein shall
----------------------
survive the execution and delivery of this Agreement and the termination of
Executive's employment hereunder for any reason.
5.7 Headings. The section and paragraph headings contained in this
--------
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.
5.8 Notices. All notices, requests, consents and other communications
-------
hereunder shall be in writing and shall be deemed to be given when delivered
personally or mailed first class, registered or certified mail, postage prepaid,
in either case, addressed as follows:
(a) If to Executive:
Mr. Harold S. Lichtin
1913 S. Lichtin
Raleigh, North Carolina 27615
with a copy to:
Mr. Alan H. Peterson
Kennedy Covington Lobdell & Hickman, L.L.P.
Two Hanover Square
434 Fayetteville Street Mall, Suite 1900
Raleigh, North Carolina 27602-1070
-9-
<PAGE>
(b) If to the Company, addressed to:
Weeks Corporation
4497 Park Drive
Norcross, Georgia 30093
Attention: Chief Executive Officer
with a copy to:
Mr. William B. Fryer
King & Spalding
191 Peachtree Street
Atlanta, Georgia 30303-1763
5.9 Counterparts. This Agreement may be executed in two or more
------------
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
5.10 Entire Agreement. This Agreement constitutes the entire agreement
----------------
of the parties with respect to the subject matter hereof and upon the Effective
Date will supersede and replace all prior agreements, written and oral, between
the parties hereto or with respect to the subject matter hereof. This Agreement
may be modified only by a written instrument signed by each of the parties
hereto.
5.11. No Violation with Other Agreements. Nothing in this
----------------------------------
Agreement shall be deemed to interfere with or be in violation of any other
obligation of Executive that may exist under other agreements to which Executive
is a party; provided, however, that such other agreements do not otherwise
violate Section 1.1 hereof.
5.12. Amendment; Waiver. Except as otherwise expressly provided in
-----------------
this Agreement, no amendment, modification or discharge of this Agreement shall
be valid or binding unless set forth in writing and duly executed by each of the
parties hereto. Any waiver by any party or consent by any party to any
variation from any provision of this Agreement shall be valid only if in writing
and only in the specific instance in which it is given, and such waiver or
consent shall not be construed as a waiver of any other provision or as a
consent with respect to any similar instance or circumstance.
5.13. Severability. If fulfillment of any provision of this
------------
Agreement, at the time such fulfillment shall be due, shall transcend the limit
of validity prescribed by law, then the obligation to be fulfilled shall be
reduced to the limit of such validity; and if any clause or provision contained
in this Agreement operates or would operate to invalidate this Agreement, in
whole in part, then such clause or provision only shall be held ineffective to
the extent of such invalidity, as though not herein contained, and the remainder
of this Agreement shall remain operative and in full force and effect.
-10-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
WEEKS CORPORATION
By:
-------------------------------------
Title:
----------------------------------
EXECUTIVE
----------------------------------------
Harold S. Lichtin
-11-
<PAGE>
EXHIBIT A
Section 1.1
- -----------
Permitted Outside Business Activities: Executive will be permitted to
-------------------------------------
continue to (i) complete the properties under development, (ii) discharge
Executive's obligations under various contracts with the Company with respect to
such properties under development and with respect to the Northern Telecom
Properties and Building 1000 of Perimeter Park and Building 1100 of Perimeter
Park West and Buildings I - IV, Research Triangle Industrial Center, (iii) sell
assets and otherwise discharge his duties and responsibilities as assignor of
Lichtin Properties, Inc. respecting various receivables and payables, (iv) serve
as an officer and director of Lichtin, Inc., the general partner of the Harold
S. Lichtin Family Limited Partnership, the purposes for which are limited to
investment activities that are not inconsistent with Executive's covenants under
that certain Noncompetition Agreement of even date herewith between Executive
and the Company, and (v) serve as an officer and director of First Class Child
Development Center, Inc., in each case consistent with that certain
Noncompetition Agreement of even date herewith between Executive and the
Company.
<PAGE>
NONCOMPETITION AGREEMENT
------------------------
THIS NONCOMPETITION AGREEMENT (this "Agreement"), is made and entered into
on this 31st day of December, 1996, by and among HAROLD S. LICHTIN, an
individual resident of the State of North Carolina ("Executive"), and the
Company (as herein defined).
W I T N E S S E T H:
-------------------
WHEREAS, on the date hereof, the Company is entering into a series of
related transactions pursuant to which it will acquire, and obtain the
contractual right to acquire, substantially all of the real estate and operating
assets of Lichtin Properties, Inc. and its related affiliates;
WHEREAS, as a condition to the consummation of the transactions described
above, the parties hereto desire to enter into certain agreements restricting
the activities of Executive in an effort to eliminate potential conflicts of
interest that may arise in the future, to protect the Company's legitimate
business interests, i.e., the value of its business and its good will, and for
other business purposes.
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt and sufficiency of which hereby are
acknowledged, the parties hereto agree as follows:
1. Definitions. Capitalized terms used herein shall have the meanings
set forth below:
"Affiliate" means (i) any entity directly or indirectly controlling,
controlled by, or under common control with Executive, and (ii) each other
entity in which Executive, directly or indirectly, owns any controlling interest
or of which Executive serves as a general partner.
"Agreement" means this Noncompetition Agreement, including any
amendments hereto made in accordance with Section 9(d) hereof.
"Company" means Weeks Corporation, a Georgia corporation, Weeks
Realty, L.P., a Georgia limited partnership, Weeks Realty Services, Inc., a
Georgia corporation, Weeks Construction Services, Inc, a Georgia corporation,
<PAGE>
Weeks LP Holdings, Inc., a Georgia corporation, Weeks LP Holdings, Inc., a
Georgia corporation, and any other entity under the common control of Weeks
Corporation and their respective successors.
"Effective Date" means the date as of which this Agreement is
executed.
"Employment Agreement" shall mean the Employment Agreement, of even
date herewith, between Executive and Weeks Corporation.
"Industrial or Office Property" means any real property on which a
distribution facility, service center and/or office building development has
been constructed or is now or hereafter proposed to constructed (for example,
and not by way of limitation, a property of the type managed by the Company).
"Managerial Responsibilities" means managerial and supervisory
responsibilities and duties of the kind contemplated by the Employment Agreement
or otherwise substantially similar to those that Executive has performed for the
Company at any time during his employment by the Company or, in the event that
Executive's employment by the Company is terminated, within two years
immediately prior thereto.
"Restricted Period" means from the Effective Date until the later of
(a) the third anniversary of the Effective Date or (b) one year following the
end of Executive's employment by the Company, subject to the provisions of
Section 4 hereof.
"Territory" means the standard metropolitan statistical area for the
Raleigh-Durham-Chapel Hill area of North Carolina.
2. Noncompetition. Without the prior written consent of the Company,
--------------
Executive will not, during the Restricted Period, serve as an officer, director,
or partner of, or own any interest in, or engage in any Managerial
Responsibilities for or on behalf of, any corporation, partnership, venture, or
other business entity that engages, directly or indirectly, in the development,
operation, management, leasing, construction, or landscaping of an Industrial or
Office Property within the Territory; provided however, that notwithstanding the
foregoing (i) Executive may acquire an interest in any such entity so long as
the nature of any such interest does not afford Executive, acting alone or in
concert with any other person or persons the power to influence in any material
fashion the decision making processes of the entity in which such interest is
held, (ii) Executive may serve as an employee, director, partner, officer or
stockholder of the Company, and (iii) Executive may serve in the respective
capacities shown on Schedule A hereto for the entities identified on Schedule A,
---------- ----------
and to discharge Executive's fiduciary and contractual duties and obligations
with respect thereto, even though such entities (or one or more entities in
which or over which one or more of the entities shown on Schedule A has an
----------
investment or exercises control) may directly compete with the Company, provided
Executive shall not engage in any activity with respect to any such entity that
would negate or materially limit the benefits to the Company of the
restrictions, prohibitions, and provisions to which Executive otherwise is
subject pursuant hereto.
-2-
<PAGE>
3. (a) Antipirating of Employees. During the Restricted Period,
-------------------------
Executive will not employ or seek to employ on his own behalf or on behalf of
any other person, firm or corporation that engages, directly or indirectly, in
the development, operation, management, leasing, construction, or landscaping of
an Industrial or Office Property within the Territory, any person who was
employed as an employee by the Company in an executive, managerial, or
supervisory capacity during the term of Executive's employment by the Company
and who has not thereafter ceased to be employed by the Company for a period of
at least one (1) year. Notwithstanding the foregoing, this Section 3(a) shall
not include Edie Walker within the scope of its coverage.
(b) Nonsolicitation of Customers. During the Restricted Period,
----------------------------
Executive will not solicit or seek to solicit on his own behalf or on behalf of
any other person, firm or corporation that engages, directly or indirectly, in
the development, operation, management, leasing, construction, or landscaping of
an Industrial or Office Property within the Territory, any customer of the
Company who is a customer of the Company at any time during Executive's
employment by the Company.
(c) Trade Secrets and Confidential Information. Executive hereby
------------------------------------------
agrees that he will hold in a fiduciary capacity for the benefit of the Company,
and shall not directly or indirectly use or disclose, any Trade Secret, as
defined hereinafter, that Executive may have acquired during the term of his
employment by the Company for so long as such information remains a Trade
Secret. The term "Trade Secret" as used in this Agreement shall mean
information, including, but not limited to, technical or nontechnical data, a
formula, a pattern, a compilation, a program, a device, a method, a technique, a
drawing, a process, financial data, financial plans, product plans, or a list of
actual or potential customers or suppliers that:
(i) derives economic value, actual or potential, from not being
generally known to, and not being readily ascertainable by proper
means by, other persons who can obtain economic value from its
disclosure or use; and
(ii) is the subject of reasonable efforts by the Company to maintain
its secrecy.
In addition to the foregoing and not in limitation thereof, Executive
agrees that during the period of his employment by the Company and for a period
of one (1) year thereafter, he will hold in a fiduciary capacity for the benefit
of the Company and shall not directly or indirectly use or disclose, any
Confidential or Proprietary Information, as defined hereinafter, that Executive
may have acquired (whether or not developed or compiled by Executive and whether
or not Executive was authorized to have access to such Information) during the
term of, in the course of, or as a result of his employment by the Company. The
term "Confidential or Proprietary Information" as used in this Agreement means
any secret, confidential, or proprietary information of the Company not
otherwise included in the definition of "Trade Secret" above. The term
"Confidential and Proprietary Information" does not include information that has
become generally available to the public by the act of one who has the right to
-3-
<PAGE>
disclose such information without violating any right of the Company.
(d) At the termination of Executive's employment under the Employment
Agreement, Executive shall return to the Company all documentation and other
tangible materials in his possession containing Trade Secrets or Confidential
Information.
4. Adjustments to Restricted Period. If Executive's employment under
--------------------------------
the Employment Agreement is terminated and such termination is a No Cause
Termination or an Employee-Initiated Termination (as defined in the Employment
Agreement), the Restricted Period shall continue until what would have been
(absent such termination) the end of Executive's then current term of employment
under such Employment Agreement; provided, however, that in no event shall such
Restricted Period be less than one year from the date of such termination so
long as Executive is paid his "Base Salary" (as defined in the Employment
Agreement) in effect on the date of such termination during such continuation of
the Restricted Period.
5. Reasonable and Necessary Restrictions. Executive acknowledges that
-------------------------------------
the restrictions, prohibitions and other provisions hereof, including without
limitation the Territory and Restricted Period, are reasonable, fair and
equitable in scope, terms and duration, are necessary to protect the legitimate
business interests of the Company, and are a material inducement to the Company
to enter into the transactions contemplated in the recitals hereto. Executive
covenants that he will not challenge the enforceability of this Agreement nor
will he raise any equitable defense to its enforcement.
6. Restrictions In Addition to Employment Agreements. Executive
-------------------------------------------------
acknowledges that the restrictions, prohibitions and other provisions hereof
shall be in addition to and not in substitution of the restrictions,
prohibitions and other provisions of the Employment Agreement, as such agreement
shall be amended and supplemented from time to time.
7. Specific Performance. Executive acknowledges that the obligations
--------------------
undertaken by him pursuant to this Agreement are unique and that the Company
likely will have no adequate remedy at law if Executive shall fail to perform
any of his obligations hereunder, and Executive therefore confirms that the
Company's right to specific performance of the terms of this Agreement is
essential to protect the rights and interests of the Company. Accordingly, in
addition to any other remedies that the Company may have at law or in equity,
the Company shall have the right to have all obligations, covenants, agreements
and other provisions of this Agreement specifically performed by Executive, and
the Company shall have the right to obtain preliminary and permanent injunctive
relief to secure specific performance and to prevent a breach or contemplated
breach of this Agreement by Executive, and Executive submits to the jurisdiction
of the courts of the State of North Carolina for this purpose.
8. Operations of Affiliates. In addition to and without in any way
------------------------
limiting any of the other provisions of this Agreement, Executive agrees that
he will refrain from authorizing any Affiliate to perform any activities that
would be prohibited by the terms of this Agreement if they were performed by
-4-
<PAGE>
Executive. Notwithstanding anything to the contrary contained in this Section 8
(or in any other section of this Agreement), Executive shall not be required by
the terms of this Agreement to violate any fiduciary or contractual duty he owes
as a director or officer of a corporation, as a partner of a partnership, as a
trustee of a trust, or as a controlling person, manager or fiduciary of any
other person or entity.
9. Miscellaneous Provisions.
------------------------
(a) Binding Effect. Subject to any provisions hereof restricting
--------------
assignment, all covenants and agreements in this Agreement by or on behalf of
any of the parties hereto shall bind and inure to the benefit of their
respective successors, assigns, heirs, and personal representatives. None of
the parties hereto may assign any of his or its rights under this Agreement or
attempt to have any other person or entity assume any of his or its obligations
hereunder.
(b) Severability. If fulfillment of any provision of this Agreement,
------------
at the time such fulfillment shall be due, shall transcend the limit of validity
prescribed by law, then the obligation to be fulfilled shall be reduced to the
limit of such validity; and if any clause or provision contained in this
Agreement operates or would operate to invalidate this Agreement, in whole or in
part, then such clause or provision only shall be held ineffective to the extent
of such invalidity, as though not herein contained, and the remainder of this
Agreement shall remain operative and in full force and effect.
(c) Governing Law. This Agreement, the rights and obligations of the
-------------
parties hereto, and any claims or disputes relating thereto shall be governed by
and construed in accordance with the laws of the State of North Carolina, not
including the choice-of-law rules thereof.
(d) Amendment; Waiver. Except as otherwise expressly provided in this
-----------------
Agreement, no amendment, modification or discharge of this Agreement shall be
valid or binding unless set forth in writing and duly executed by each of the
parties hereto. Any waiver by any party or consent by any party to any
variation from any provision of this Agreement shall be valid only if in writing
and only in the specific instance in which it is given, and such waiver or
consent shall not be construed as a waiver of any other provision or as a
consent with respect to any similar instance or circumstance.
(e) Headings. Section and subsection headings contained in this
--------
Agreement are inserted for convenience of reference only, shall not be deemed to
be a part of this Agreement for any purpose, and shall not in any way define or
affect the meaning, construction or scope of any of the provisions hereof.
(f) Pronouns. All pronouns and any variations thereof shall be deemed
--------
to refer to the masculine, feminine, neuter, singular or plural, as the identity
of the person or entity may require.
-5-
<PAGE>
(g) Arbitration. If a dispute arises between the parties, then the
-----------
parties agree that their respective representatives shall meet and consult in
good faith and attempt to settle the dispute, within thirty (30) days of written
notice thereof, as a condition precedent to the initiation of arbitration
proceedings as set forth below.
Any dispute, controversy, or claim arising out of or relating to this
Agreement, the breach, termination or invalidity thereof, or Executive's
noncompetition obligations, including claims of tortious interference or other
tort or statutory claims, and including without limitation any dispute
concerning the scope of this arbitration clause, shall be settled by arbitration
in accordance with the Employment Dispute Arbitration Rules of the American
Arbitrators Association then in effect. The judgment on the award rendered by
the arbitrator may be entered in any court having jurisdiction thereof. The
arbitration under this Agreement shall be held in Raleigh, North Carolina, or at
such other place as may be selected by mutual agreement of the parties.
The arbitrator shall be mutually acceptable to the parties, or failing
agreement, selected pursuant to the Employment Dispute Arbitration Rules of the
American Arbitrators Association. The parties intend that the arbitrator shall
be independent and impartial. To this end, the arbitrator shall disclose to the
parties any professional, family, or social relationships, past or present, with
any party or counsel.
Strict rules of evidence shall not apply in any arbitration conducted
pursuant to this Agreement. The parties may offer such evidence as they desire
and the arbitrator shall accept such evidence as the arbitrator deems relevant
to the issues and accord it such weight as the arbitrator deems appropriate.
The arbitrator shall have the discretion to order a prehearing exchange of
information by the parties, including without limitation, production of
requested documents, exchange of summaries of testimony of proposed witnesses,
and examination by deposition of parties. No party shall be allowed, however,
to take more than one deposition of the opposing party and no deposition shall
last longer than six (6) hours. All disputes regarding discovery shall be
decided by the arbitrator.
The arbitrator award shall be in writing and shall specify the factual and
legal bases for the award. In rendering the award, the arbitrator shall
determine the respective rights and obligations of the parties according to the
laws of the State of North Carolina or, if applicable, federal law. The
arbitrator shall have the authority to award any remedy or relief that a federal
or state court within the State of North Carolina could order or grant.
Any provisional remedy that would be available from a court of law shall be
available from the arbitrator to the parties, pending the arbitrator's
determination of the merits of the parties' dispute. This shall include orders
of attachment, temporary restraining orders, injunctions, and appointment of a
receiver. If the arbitrator issues such an order, either party may immediately
apply to a court of competent jurisdiction for enforcement of the order, even
though the arbitrator may not have rendered a final award.
-6-
<PAGE>
All fees and expenses of the arbitration, including the fees of the
arbitrator and the expense of each parties' counsel, experts, witnesses and
preparation and presentation of proofs, shall be paid by Company.
Unless legally required to do so, neither party may disclose the existence,
content, or results of any arbitration under this Agreement without the prior
written consent of the other party, nor may the arbitrator disclose any such
information without the consent of both parties. This provision shall apply to
all aspects of the arbitration proceeding, including without limitation,
discovery, testimony, other evidence, briefs, and the award.
It is the specific intent of the parties that this arbitration clause be
governed by the Federal Arbitration Act, 9 U.S.C. Section 1 et. seq. ("FAA");
however, if this cause is unenforceable for any reason under the FAA, then the
parties intend that it be governed by the provisions of the Uniform Arbitration
Act, N.C. Gen. Stat. 1-567.1 through 1-567.20.
Both Executive and Company represent and warrant they have read the
foregoing Section 9(g), that they have had an opportunity to consult with and
receive advice from legal counsel regarding the foregoing Section 9(g), and that
they hereby forever waive all rights to assert that this Section 9(g) was the
result of duress, coercion, or mistake of law or fact.
(Initial of both parties in each space).
----- -----
(h) Execution in Counterparts. This Agreement may be executed in two
-------------------------
or more counterparts, none of which need contain the signatures of all parties
hereto and each of which shall be deemed an original.
(i) Notices. All notices, requests, consents and other communications
-------
hereunder shall be in writing and shall be deemed to be given when delivered
personally or mailed first class, registered or certified mail, postage prepaid,
in either case, addressed as follows:
(i) If to Executive:
Mr. Harold S. Lichtin
1913 S. Lichtin
Raleigh, North Carolina 27615
-7-
<PAGE>
with a copy to:
Mr. Alan H. Peterson
Kennedy Covington Lobdell & Hickmans L.L.P.
The Hanover Square
434 Fayetteville Street Mall
Suite 1900
Raleigh, North Carolina 27602-1070
(ii) If to the Company, addressed to:
Weeks Corporation
4497 Park Drive
Norcross, Georgia 30093
Attention: Chief Executive Officer
with a copy to:
Mr. William B. Fryer
King & Spalding
191 Peachtree Street
Atlanta, Georgia 30303-1763
(j) Entire Agreement. This Agreement constitutes the entire agreement
----------------
of the parties with respect to the subject matter hereof and will supersede and
replace all prior agreements, written and oral, between the parties hereto or
with respect to the subject matter hereof.
-8-
<PAGE>
IN WITNESS WHEREOF, each of the undersigned has executed this Agreement, or
caused this Agreement to be duly executed on its behalf, as of the date first
set forth above.
WEEKS CORPORATION
By:
----------------------------------------
Title:
---------------------------------
WEEKS REALTY, L.P., a Georgia limited partnership
authorized to do business in the State of North
Carolina as Weeks Realty Limited Partnership
By: Weeks GP Holdings, Inc.,
General Partner
By:
----------------------------------------
Title:
---------------------------------
WEEKS REALTY SERVICES, INC.
By:
----------------------------------------
Title:
---------------------------------
-9-
<PAGE>
WEEKS CONSTRUCTION SERVICES, INC.
By:
----------------------------------------
Title:
---------------------------------
-------------------------------------------
HAROLD S. LICHTIN
-10-
<PAGE>
SCHEDULE A
----------
Executive will be permitted to continue to (i) complete the properties
under development, (ii) discharge Executive's obligations under various
contracts with the Company with respect to such properties under development and
with respect to the Northern Telecom Properties and Building 1000 of Perimeter
Park and Building 1100 of Perimeter Park West and Buildings I - IV, Research
Triangle Industrial Center, (iii) sell assets and otherwise discharge his duties
and responsibilities as assignor of Lichtin Properties, Inc. respecting various
receivables and payables, (iv) serve as an officer and director of Lichtin,
Inc., the general partner of the Harold S. Lichtin Family Limited Partnership,
the purposes for which are limited to investment activities, and (v) serve as an
officer and director of First Class Child Development Center, Inc.
<PAGE>
INDEMNIFICATION AGREEMENT
THIS INDEMNIFICATION AGREEMENT (this "Agreement"), made and entered
into as of the 31st day of December, 1996, by and between WEEKS CORPORATION, a
Georgia corporation (the "Company"), and HAROLD S. LICHTIN, a director and an
officer of the Company ("Indemnitee"). For the purposes of this Agreement, all
references to the "Company" shall include all subsidiaries, affiliates,
corporations, partnerships, joint ventures, enterprises, employee benefit plans,
trusts and other entities on behalf of which Indemnitee serves or will serve at
the Company's request as an officer, director, partner, trustee, employee or
agent or in a related capacity, including, without limitation, Weeks GP
Holdings, Inc., a Georgia corporation, and Weeks LP Holdings, Inc., a Georgia
corporation.
WITNESSETH:
-----------
WHEREAS, Indemnitee has agreed to serve, at the request of the
Company, as a director and an officer of the Company; and
WHEREAS, Indemnitee is willing to serve as a director of the Company
on the condition that he be indemnified, and that he have litigation expenses
advanced, to the maximum extent permitted by law;
NOW, THEREFORE, in consideration of Indemnitee's agreement to serve as
a director and an officer of the Company, and for other good and valuable
<PAGE>
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties do hereby agree as follows:
1. Mandatory Indemnification.
-------------------------
(a) The Company shall indemnify and hold harmless Indemnitee to the
maximum extent provided for in this Agreement, and, to the extent that
applicable law from time to time in effect shall permit indemnification that is
broader than provided in this Agreement, then to the maximum extent authorized
by law. All amounts payable under the Company's indemnification obligation
shall be paid within thirty (30) days of Indemnitee's request therefor.
(b) In connection with any threatened, pending or completed claim,
action, suit or proceeding to which Indemnitee is made or is threatened to be
made a named defendant or respondent ("Party"), whether civil, criminal,
administrative or investigative, and whether formal or informal, except for
those actions set forth in Section 1(f) hereof (an "Action"), but not including
any Action by or in the right of the Company (a "Derivative Action"), the
Company hereby agrees to indemnify and hold Indemnitee harmless from and against
any judgment, settlement, penalty, fine (including an excise tax assessed with
respect to an employee benefit plan), interest and reasonable expense (including
attorney's fees) actually incurred by him by reason of the fact that Indemnitee
is or was an officer, director, employee or agent of the Company, or has
liability under Section 11(a) of the Securities Act of 1933, as amended, or is
or was serving at the request of the Company as an officer, director, agent or
fiduciary of any corporation, partnership, joint venture, employee benefit plan,
trust or other enterprise, provided, however, that Indemnitee acted in a manner
-------- -------
he believed in good faith to be in or not opposed to the best interests of the
Company, and with respect to any criminal Action, Indemnitee had no reasonable
cause to believe his conduct was unlawful, and with respect to an employee
benefit plan, Indemnitee acted in a manner he believed in good faith to be in
2
<PAGE>
the interests of the participants in and beneficiaries of the plan. Whether an
Action is threatened, and whether Indemnitee is threatened to be made a Party
thereto, shall be determined by Indemnitee in his reasonable judgment.
(c) In connection with any Derivative Action, the Company hereby
agrees to indemnify and hold Indemnitee harmless from and against any reasonable
expenses actually incurred by him (including amounts paid in settlement but not
including amounts paid as a judgment, penalty or fine in respect of any such
action) by reason of the fact that Indemnitee is or was an officer, director,
partner, trustee, employee or agent of the Company; provided, however, that
-------- -------
Indemnitee acted in good faith and in a manner he reasonably believed to be in
or not opposed to the best interests of the Company.
(d) The termination of any Action by judgment, order, settlement,
conviction, or upon a plea of nolo contendere or its equivalent shall not, of
itself, create a presumption that Indemnitee did not act in a manner which he
believed to be in or not opposed to the best interests of the Company and, with
respect to any criminal Action, had reasonable cause to believe that his conduct
was unlawful.
(e) Notwithstanding any foregoing provision to the contrary, under no
circumstance shall the Company indemnify or hold Indemnitee harmless from and
against any liability for judgments, settlements, penalties, fines (including
excise taxes assessed with respect to an employee benefit plan), or expenses
(including attorney's fees) incurred by Indemnitee in a proceeding in which
Indemnitee is adjudged liable to the Company or is subjected to injunctive
relief in favor of the Company (i) for any appropriation, in violation of his
duties, of any business opportunity of the Company, (ii) for acts or omissions
that involve intentional misconduct or knowing violation of law, (iii) for the
3
<PAGE>
types of liability set forth in Section 14-2-832 of Georgia Business Corporation
Code, or (iv) for any transaction from which he received an improper personal
benefit.
(f) Notwithstanding any foregoing provision to the contrary, under no
circumstance shall the Company indemnify or hold Indemnitee harmless from and
against any liability for judgments, settlements, penalties, fines (including
excise taxes assessed with respect to an employee benefit plan), or expenses
(including attorney's fees) incurred by Indemnitee in a proceeding in which
Indemnitee is adjudged liable to the Company or any the Company's affiliates or
is subjected to injunctive relief in favor of the Company or any of the
Company's affiliates (i) in connection with the Employment Agreement by and
between Indemnitee and the Company dated as of the date hereof, (ii) in
connection with the Noncompetition Agreement by and between Indemnitee and the
Company (as defined therein) dated as of the date hereof, or (iii) in connection
with any other agreement which is executed by Indemnitee in connection with the
acquisition of the assets of Lichtin Properties, Inc. ("Lichtin") and certain of
Lichtin's affiliates by the Company and by certain of the Company's affiliates.
2. Partial Indemnification. If Indemnitee is entitled under any
-----------------------
provision of this Agreement to indemnification by the Company for some or a
portion of any liability (including judgments, settlements, penalties, fines
(including excise taxes assessed with respect to an employee benefit plan),
interest or reasonable expenses (including attorney's fees)) actually incurred
by him but not entitled to indemnification for all of the total amount thereof,
the Company shall indemnify Indemnitee for such portion thereof to which
Indemnitee is entitled.
3. Advancement of Expenses. The Company agrees to pay, in advance
-----------------------
4
<PAGE>
of the final disposition of any Action (including, for this purpose, any
proceeding in Section 5 hereof) and within ten (10) days after Indemnitee's
written request, all reasonable expenses incurred by Indemnitee in defending or
acting as a witness in connection with such Action, including but not limited to
the investigation, defense, settlement or appeal of any Action, to which
Indemnitee is a Party or threatened in the reasonable judgment of Indemnitee to
be made a Party by reason of the fact that Indemnitee is or was an officer,
director, employee or agent of the Company, or has liability under Section 11(a)
of the Securities Act of 1933, as amended, or is or was serving at the request
of the Company as an officer, director, agent or fiduciary of any corporation,
partnership, joint venture, employee benefit plan, trust or other enterprise.
Indemnitee shall furnish the Company (i) a written affirmation of his good faith
belief that Indemnitee has met the standard of conduct set forth in Section 1(b)
of 1(c) hereof; and (ii) a written undertaking, executed personally or on
Indemnitee's behalf, to repay any advances if it is ultimately determined that
Indemnitee is not entitled to indemnification. Indemnitee agrees to reimburse
the Company for any such advancement if, when and to the extent it is ultimately
determined (by a court in a proceeding described in Section 5 or otherwise) that
Indemnitee is not entitled to indemnification pursuant to this Agreement.
4. Indemnification in Specific Actions.
-----------------------------------
(a) The determination of whether, with respect to any specific Action,
Indemnitee has met the applicable standard of conduct set forth in Section 1(b)
or Section 1(c) hereof and is entitled to indemnification pursuant to Section 1
hereof shall be made (i) by a majority vote of a quorum of members of the Board
of Directors of the Company not at the time parties to the Action; (ii) if the
quorum required by the foregoing clause (i) cannot be obtained, by a majority
vote of a committee duly designated by the Board of Directors (in which
designation directors who are parties to the Action may participate) and
5
<PAGE>
consisting solely of two or more members of the Board of Directors not at the
time parties to the Action; (iii) if a determination cannot be made under (i) or
(ii) above, in a written opinion by independent legal counsel, selected by the
Board of Directors or its committee in the manner described in the foregoing
clauses (i) or (ii) (or, if a quorum of the Board of Directors as required by
the foregoing clause (i) cannot be obtained and a committee cannot be designated
as required by the foregoing clause (ii), by a majority vote of the full Board
of Directors (in which selection directors who are parties to the Action may
participate); or (iv) if agreed to by Indemnitee, by the vote of a majority of
shares of the Company entitled to vote thereon (excluding shares owned by, or
the voting of which is controlled by, directors who at the time are parties to
the Action).
(b) In the event that the determination is made that Indemnitee is
entitled to indemnification or advancement of expenses in a specific Action
pursuant to Section 1 hereof, such a determination is binding upon the Company
in any subsequent proceedings in connection with such Action.
5. Enforcement of this Agreement.
-----------------------------
(a) Reasonable expenses incurred by Indemnitee in connection with his
request for indemnification hereunder shall be borne by the Company, unless
Indemnitee is determined not to be entitled to indemnification for any liability
or expense hereunder. In the event that Indemnitee is a party to or intervenes
in any proceeding in which the validity or enforceability of this Agreement is
at issue or seeks an adjudication or award in arbitration to enforce his rights
under, or to recover damages for breach of, this Agreement, Indemnitee, if he
prevails in whole or in part in such action, shall be entitled to recover from
the Company and shall be indemnified by the Company against any expenses
6
<PAGE>
actually and reasonably incurred by him.
(b) In any proceeding in which the validity or enforceability of this
Agreement is at issue, or in which Indemnitee seeks an adjudication or award in
arbitration to enforce his rights hereunder, the Company shall have the burden
of proving that Indemnitee is not entitled to indemnification hereunder.
6. Termination of Service. Indemnitee's right to indemnification
----------------------
and advancement of expenses pursuant to this Agreement shall continue regardless
of whether Indemnitee has ceased for any reason to be a director of the Company
and shall inure to the benefit of the heirs of Indemnitee and the executors or
administrators of Indemnitee's estate.
7. Maintenance of Directors and Officers Liability Insurance. In
---------------------------------------------------------
the event the Company maintains policies of Directors and Officers Liability
Insurance, Indemnitee shall be named as an insured in such manner as to provide
Indemnitee the same rights and benefits as are accorded to the most favorably
insured of the Company's directors.
8. Subrogation. In the event Indemnitee receives a payment under
-----------
this Agreement, the Company shall be subrogated to the extent of such payment to
all of the rights of recovery of Indemnitee, who shall do everything that may be
necessary to secure such rights, including the execution of such documents
necessary to enable the Company effectively to bring suit to enforce such
rights.
9. No Duplication of Payments. The Company shall not be liable
--------------------------
under this Agreement to make any payment in connection with any Action to the
extent Indemnitee has otherwise actually received payment (under any insurance
policy, bylaw provision or otherwise) of the amounts otherwise indemnifiable
hereunder.
7
<PAGE>
10. Non-Exclusivity. Indemnitee's rights under this Agreement shall
---------------
be in addition to, and not in lieu of, any other rights Indemnitee may have
under any provision of the Company's Articles of Incorporation or Bylaws, the
Georgia Business Corporation Code or pursuant to any Directors or Officers
Liability Insurance. Nothing in this Agreement shall be deemed to diminish or
otherwise restrict Indemnitee's right to indemnification under any provision of
the Company's Articles of Incorporation or Bylaws, the Georgia Business
Corporation Code or pursuant to any Directors and Officers Liability Insurance,
but the rights to indemnification hereunder shall in any event apply
notwithstanding any contrary provision in, or conflict with, any provision of
the Company's Articles of Incorporation or Bylaws, unless prohibited by law.
11. Binding Effect. This Agreement shall be binding upon and inure
--------------
to the benefit of and be enforceable by the parties hereto and their respective
successors, assigns (including any direct or indirect successor by merger or
consolidation as provided in the Georgia Business Corporation Code), heirs,
executors and administrators.
12. Governing Law. This Agreement shall be deemed to be made in, and
-------------
in all respects shall be interpreted, construed, and governed by and in
accordance with the laws of, the State of Georgia (without regard to the
conflict of laws principles thereof).
13. Severability. The Company and Indemnitee agree that the
------------
agreements and provisions contained in this Agreement are severable and
divisible, that each such agreement and provision does not depend upon any other
provision or agreement for its enforceability, and that each such agreement and
provision set forth herein constitutes an enforceable obligation between the
Company and Indemnitee. Consequently, the parties hereto agree that neither the
invalidity nor the unenforceability of any provision of this Agreement shall
8
<PAGE>
affect the other provisions hereof, and this Agreement shall remain in full
force and effect and be construed in all respects as if such invalid or
unenforceable provision were omitted.
14. Certain Amendments. The Company may enter into any amendment to
------------------
this Agreement required by applicable law without shareholder approval of such
amendment, unless shareholder approval is required by applicable law.
15. Letter of Credit. In order to secure the obligations of the
----------------
Company to indemnify and advance expenses to Indemnitee pursuant to this
Agreement, the Company shall obtain and maintain for the benefit of Indemnitee,
for a period of five years from the time of any Change in Control, an
irrevocable standby letter of credit naming Indemnitee as the sole beneficiary
(the "Letter of Credit"). The Letter of Credit shall be in an appropriate
amount, not less than $1,000,000, issued by a financial institution having
assets in excess of $100,000,000, and contain terms and conditions reasonably
acceptable to Indemnitee. The Letter of Credit shall provide that Indemnitee
may from time to time draw certain amounts thereunder, upon written
certification by Indemnitee to the issuer of the Letter of Credit that (a)
Indemnitee has made a written request upon the Company for an amount not less
than the amount he is drawing under the Letter of Credit and that the Company
has failed or refused to provide him with such amount in full within thirty (30)
days after receipt of the request, or to advance expenses within ten (10) days
after receipt of the request, (b) Indemnitee believes that he is entitled under
the terms of this Agreement to the amount that he is drawing under the Letter of
Credit, and (c) there has not been a determination as contemplated under this
Agreement that Indemnitee is not entitled to indemnification under this
Agreement. The issuance of the Letter of Credit shall not in any way diminish
the Company's obligation to indemnify Indemnitee to the full extent required by
9
<PAGE>
this Agreement. For the purposes hereof, a "Change in Control" shall be deemed
to have occurred if (i) any "Person" (as such term is used in Section 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended), other than a trustee
or other fiduciary holding securities under an employee benefit plan of the
corporation or a corporation owned directly or indirectly by the shareholders of
the Company in substantially the same proportions as their ownership of stock of
the Company, is or becomes the "beneficial owner" (as defined in Rule 13d-3
under said Act), directly or indirectly, of securities of the Company
representing more than 50% of the total voting power represented by the
Company's then outstanding voting securities; or (ii) during any period of two
consecutive years, individuals who at the beginning of such period constitute
the Board of Directors of the Company and any new director whose election by the
Board of Directors or nomination for election by the Company's shareholders was
approved by a vote of at least two-thirds (2/3) of the directors who either were
directors at the beginning of the two-year period or whose election or
nomination for election was previously so approved, cease for any reason to
constitute a majority thereof.
10
<PAGE>
IN WITNESS WHEREOF, the parties hereto have entered into this
Agreement as of the date first above written.
[CORPORATE SEAL] WEEKS CORPORATION
Attest:
By: By:
-------------------- -------------------------------
Secretary Name:
Title:
INDEMNITEE
------------------------------------
Harold S. Lichtin
11
<PAGE>
SECOND AMENDMENT
TO THE
SECOND AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP
OF
WEEKS REALTY, L.P.
THIS SECOND AMENDMENT TO THE SECOND AMENDED AND RESTATED AGREEMENT OF
LIMITED PARTNERSHIP OF WEEKS REALTY, L.P. is entered into as of the 31st day of
December, 1996, by and among HAROLD S. LICHTIN, an individual resident of North
Carolina, NOEL A. LICHTIN, an individual resident of North Carolina, MARIE
ANTOINETTE ROBERTSON, an individual resident of Texas, AMY R. EHRMAN, an
individual resident of Texas, ROLAND G. ROBERTSON, an individual resident of
Texas, and PERIMETER PARK WEST ASSOCIATES LIMITED PARTNERSHIP, a North Carolina
limited partnership (Harold S. Lichtin, Noel A. Lichtin, Marie Antoinette
Robertson, Amy R. Ehrman, Roland G. Robertson and Perimeter Park West Associates
Limited Partnership are collectively referred to hereafter as the "Contributors"
and "Contributor" shall hereafter mean any one of the Contributors, WEEKS GP
HOLDINGS, INC., a Georgia corporation (the "General Partner"), and WEEKS
CORPORATION, a Georgia corporation (the "Company"). The Company is executing
and delivering this Second Amendment solely for purposes of paragraphs 8, 9, 10,
11 and 12 hereof and to confirm the Company's undertakings set forth in Exhibit
D hereto.
<PAGE>
RECITALS
--------
Weeks Realty, L.P. (the "Partnership") is a Georgia limited partnership
authorized to do business in the State of North Carolina as Weeks Realty Limited
Partnership. The General Partner is the sole general partner of the Partnership
and is a wholly owned subsidiary of the Company. The partnership agreement of
the Partnership is that certain Second Amended and Restated Agreement of Limited
Partnership of Weeks Realty, L.P., dated as of October 30, 1996 (the
"Partnership Agreement") as amended by the First Amendment to the Partnership
Agreement dated November 1, 1996. Capitalized terms used herein without
definition shall have the meanings ascribed to them in the Partnership
Agreement.
Pursuant to the agreements and instruments listed or referred to on Exhibit
A hereto (the ("Transaction Documents"), and the transactions effected by the
Transaction Documents, effective as of the date hereof the Contributors have
contributed, directly or indirectly, certain assets, properties and businesses
to the capital of the Partnership, including the Completed Properties which are
further described on Exhibit F hereto. The Contributors have agreed, subject to
the terms and conditions of the Transaction Documents, to make certain
additional contributions of properties to the capital of the Partnership at
certain times in the future.
Immediately following the issuance of Partnership Interests to the
Contributors, Perimeter Park West Associates Limited Partnership will distribute
a portion of its Partnership Interests to Harold S. Lichtin, Marie Antoinette
Robertson, Amy R. Ehrman and Roland G. Robertson, each of whom is a partner
therein, as reflected in Exhibit B hereto.
Pursuant to the Partnership Agreement (including, without limitation,
Section 9.3 and Section 15.7(b)(ii) thereof), the General Partner is authorized
(without the consent of any Limited Partner) to admit additional Limited
Partners to the Partnership for such Capital Contributions as are determined by
the General Partner to be appropriate, and to amend the Partnership Agreement to
reflect such admissions.
-2-
<PAGE>
The General Partner wishes to amend the Partnership Agreement as set forth
herein to reflect the admission of the Contributors as Limited Partners of the
Partnership, and the Contributors wish to enter into this Second Amendment to
memorialize their agreement as to certain matters relating to their becoming
Limited Partners of the Partnership.
AGREEMENT
---------
In consideration of the circumstances referred to in the Recitals, the
consummation of the transactions effected pursuant to the Transaction Documents,
the mutual covenants and agreements contained herein, and other good and
valuable consideration, the receipt, adequacy and sufficiency of which are
hereby acknowledged, the parties hereto, intending to be legally bound, hereby
agree as follows:
1. Admission. The Contributors are hereby admitted to the Partnership as
---------
Limited Partners, effective as of the date hereof, and each of the Contributors
hereby agrees to be bound by the Partnership Agreement, including, but not
limited to, the transfer restrictions contained in Article IX thereof.
2. Capital Contributions. The Contributors are agreed to have made, as of
---------------------
the date hereof, the Capital Contributions set forth on Exhibit B hereto. The
agreed to gross fair market values of any property other than money contributed
by each of the Contributors, which shall be such property's initial Gross Asset
Value, are shown on Exhibit B.
3. Initial Partnership Units; Rights.
---------------------------------
(a) The Partnership Units attributable to the Partnership Interests of
the Contributors, effective upon their admission as Limited Partners at the
date hereof, are as set forth on Exhibit B hereto, and the Partnership
Agreement is hereby amended to reflect the Contributors' having such
Partnership Units.
-3-
<PAGE>
(b) The Partnership does hereby grant to each of the Contributors, and
each of them does hereby accept, the right, but not the obligation (herein
such rights being sometimes referred to as the "Rights"), to require the
Partnership to redeem all or a portion of the Partnership Units issued to
them pursuant to the Transaction Documents, on the terms and subject to the
conditions and restrictions contained in Exhibit D hereto. The Rights are
governed solely by this Second Amendment and Exhibit D hereto, and none of
the Contributors shall have any rights with respect to the "Rights"
provided for in Section 11.1 and Exhibit B-1 to the Partnership Agreement.
The Rights granted hereunder may be exercised by any one or more of the
Contributors, on the terms and subject to the conditions and restrictions
contained in Exhibit D hereto, upon delivery to the Partnership of a
Conversion Exercise Notice, in the form of Schedule 1 attached to Exhibit
D, which notice shall specify the Partnership Units with respect to which
the Rights are being exercised. Once delivered, the Conversion Exercise
Notice shall be irrevocable, subject to compliance by the General Partner
and the Partnership with the terms of the Rights.
4. Restated Percentage Interests. After giving effect to the admission of
-----------------------------
the Contributors as Limited Partners at the date hereof, the Percentage
Interests of all of the Partners have been revised and are as reflected on
Exhibit C hereto, and the Partnership Agreement is hereby amended accordingly.
The parties acknowledge that Exhibit C reflects the distribution by Perimeter
Park West Associates Limited Partnership of a portion of its Partnership
Interests to certain of the Contributors who hold partnership interests in
Perimeter Park West Associates Limited Partnership.
5. Future Contributions. The parties acknowledge that, pursuant to and
--------------------
subject to the terms and conditions of the Transaction Documents, the
Contributors will make additional Capital Contributions. Concurrently with each
such additional Capital Contribution, the General Partner shall supplement this
Second Amendment by executing and attaching hereto supplements to Exhibits B and
C (which shall be captioned "Exhibit B-1," "Exhibit B-2," "Exhibit C-1,"
-4-
<PAGE>
"Exhibit C-2," and so on and shall identify the Capital Contribution to which
each relates) that will, respectively, reflect (to the extent determinable at
such time) the Capital Contribution made by the Contributors at that time, the
initial Gross Asset Value of any property other than money included in such
Capital Contribution, the additional Partnership Units attributable to the
Partnership Interest associated with such Capital Contribution, and the
resulting restated Percentage Interests of all of the Partners. Such
supplements shall be in accordance with the terms of the Transaction Documents.
The Partnership Agreement shall be deemed to be amended as reflected in each
such supplement to this Second Amendment.
6. Adjustments to Partnership Units. The parties acknowledge that the
--------------------------------
Transaction Documents provide for adjustments to the Partnership Units of the
Contributors in certain circumstances, and further provide that the
Contributors' Partnership Interests and Units, and the resulting restated
Percentage Interests of all of the Partners, may not be capable of determination
at the time a Capital Contribution is made after the date hereof. At the times
of adjustment and final determination provided for in the Transaction Documents,
the General Partner shall supplement this Second Amendment by executing and
attaching hereto either additional supplements to Exhibits B and C (in the form
described above), or amended and restated versions of prior supplements to
Exhibits B and C, as applicable. Such supplements shall be in accordance with
the terms of the Transaction Documents. The Partnership Agreement shall be
deemed to be amended as reflected in each such supplement to this Second
Amendment.
7. Proration of Distributions. Notwithstanding any contrary provision of
--------------------------
the Partnership Agreement, including, without limitation, Section 6.2 thereof,
the Contributors agree that the distribution of Net Operating Cash Flow made for
the calendar quarter in which Partnership Units are issued by reason of each
Capital Contribution made pursuant to the Transaction Documents shall be equal
to the amount of Net Operating Cash Flow otherwise distributable with respect to
such under the terms of the Partnership Agreement, multiplied by a fraction,
the numerator of which is the number of calendar days beginning on the date such
Capital Contribution is made and ending on the last day of the calendar quarter
-5-
<PAGE>
with respect to which such distribution is being made, and the denominator of
which is the total number of days in such calendar quarter.
8. Representations and Warranties.
------------------------------
(a) Contributors' Representations. The Contributors hereby acknowledge
-----------------------------
that they have made and will make representations, warranties, covenants
and agreements with and to the Partnership, the General Partner and the
Company in the Transaction Documents, including, without limitation, that
certain Contribution Agreement for Completed Properties Lichtin Portfolio,
of even date herewith, between the Partnership and the Contributors; that
certain Contribution Agreement for Development Properties and Regency
Forest Land, of even date herewith, between the Partnership and the
Contributors; that certain Contribution Agreement for Northern Telecom
Properties, of even dated herewith, between the Partnership and the
Contributors; that certain Contribution Agreement (Perimeter Park West
Land) between the Partnership and the Contributors; and that certain
Contribution Agreement between the Partnership and Harold S. Lichtin
(collectively, the "Contribution Agreements"); and that certain Agreement
and Plan of Merger, of even date herewith, by and among the Company,
Lichtin Properties, Inc. and Harold S. Lichtin (the "Merger Agreement").
(b) No Liens. The Contributors represent and warrant to the Partnership
--------
and the General Partner that at the date hereof none of the issued or
issuable to them pursuant to the Transaction Documents, and none of the
shares of Common Stock that may be acquired by them upon exercise of
Rights, is subject to any Lien, other than the security interest created by
paragraph 11 hereof.
(c) Definition. All of the representations, warranties, covenants and
----------
agreements of the Contributors referred to in this paragraph 8 are referred
to collectively as the "Representations and Warranties."
-6-
<PAGE>
(d) General Partner Representations. The General Partner represents and
-------------------------------
warrants to the Contributors as follows:
(i) Organization. The General Partner is duly incorporated,
------------
validly existing and in good standing under the laws of the State of
Georgia.
(ii) Due Authorization; Binding Agreement. The execution,
------------------------------------
delivery and performance of this Second Amendment by the General
Partner have been duly and validly authorized by all necessary action
of the General Partner and the Partnership. This Second Amendment has
been duly executed and delivered by the General Partner and
constitutes a legal, valid and binding obligation of the General
Partner and the Partnership, enforceable against the General Partner
and the Partnership in accordance with the terms hereof.
(iii) Consents and Approvals. No consent, waiver, approval or
----------------------
authorization of, or filing, registration or qualification with, or
notice to, any governmental unit or any other Person is required to be
made, obtained or given by the General Partner in connection with the
execution, delivery and performance of this Second Amendment, other
than consents, waivers, approvals or authorizations that have been
obtained prior to the date hereof.
(iv) The issued and issuable pursuant to the Transaction
Documents are duly authorized and, when issued in accordance with the
Transaction Documents, will be duly issued, fully paid and
nonassessable and will be unencumbered except for the security
interest created by paragraph 11 hereof.
9. Survival of Representations and Warranties. All of the Representations
------------------------------------------
and Warranties shall survive the consummation of the transactions contemplated
-7-
<PAGE>
by the Transaction Documents; provided, however, that no claim for a breach of
any Representation or Warranty may be maintained by the Partnership, the General
Partner or the Company unless the General Partner or the Company shall have
delivered a written notice ("Notice of Breach") specifying the details of such
claimed breach to the Contributors on or before the third anniversary of the
date hereof (the "Survival Period"); provided further, however, that (i) with
respect to a claim for a breach of any Representation or Warranty relating to
any property contributed to the Partnership subsequent to the date hereof as
contemplated under paragraph 5 of this Second Amendment, the Survival Period
shall extend until the later of (A) the third anniversary of the date hereof or
(B) the first anniversary of the date on which such property is contributed to
the Partnership, (ii) with respect to a claim for a breach of any Representation
or Warranty made by the Lichtin Parties (as defined in the Merger Agreement) in
the Merger Agreement (other than any Representation or Warranty set forth in
Sections 2.11 or 2.12 of the Merger Agreement), the Survival Period shall extend
until the last day of the Survival Period provided under clause (i) above
relating to the last property contribution made to the Partnership pursuant to
the Transaction Documents, and (iii) with respect to a claim for a breach of any
Representation or Warranty set forth in Sections 2.11 or 2.12 of the Merger
Agreement, the Survival Period shall be indefinite.
10. Indemnification.
---------------
(a) The Contributors, jointly and severally, indemnify and hold
harmless the Partnership, the General Partner and the Company against and
from all liabilities, demands, claims, actions or causes of action,
assessments, losses, fines, penalties, costs, damages and expenses
(including, without limitation, reasonable attorneys' and accountants' fees
and expenses actually incurred) sustained or incurred by the Partnership,
the General Partner or the Company as a result of or arising out of any
inaccuracy in or breach of a Representation or Warranty.
(b) The Partnership, the General Partner and the Company shall not be
entitled to indemnification hereunder unless a Notice of Breach has been
-8-
<PAGE>
delivered by the Partnership, the General Partner or the Company to the
Contributors within the time period specified in paragraph 9 hereof.
(c) Subject to the further provisions hereof (including subparagraph
(f) of this paragraph 10), the Contributors shall not be liable under this
paragraph 10 unless and until the total amount recoverable from the
Contributors under this paragraph 10 exceeds, in the aggregate, $250,000;
provided, however, that if the Contributors' obligation under this
paragraph 10 exceeds, in the aggregate, such limit, their obligation under
this paragraph 10 shall be for the full amount of such obligation, subject,
however, in all respects to the limitations set forth in paragraph 11
hereof.
(d) If a claim for indemnification is asserted by the Partnership, the
General Partner or the Company against the Contributors, the Contributors
shall have the right, at their own expense, to participate in the defense
of any claim, action or proceeding asserted against the Partnership, the
General Partner or the Company that resulted in the claim for
indemnification, and if such right is exercised, the parties shall
cooperate in the defense of such action or proceeding.
(e) Subject to subparagraph (f) of this paragraph 10 and subparagraph
(b) of paragraph 12 hereof, indemnification of the Partnership, the General
Partner and the Company pursuant to this paragraph 10 and the remedies in
respect thereof as set forth in paragraph 11 hereof shall be the exclusive
remedy of the Partnership, the General Partner and the Company for any
breach of any Representation or Warranty, and the only legal action that
may be asserted against the Contributors under this paragraph 10 for breach
of a Representation or Warranty shall be to pursue the remedies in respect
thereof as set forth in paragraph 11 hereof. Nothing contained herein shall
limit any remedy the Partnership may have under the Contribution
Agreements, including, without limitation, the remedy of specific
performance for any failure by any of the Contributors to contribute a
Development Property, a Northern Telecom Property or land pursuant to the
-9-
<PAGE>
Contribution Agreements, or otherwise limit any remedy the Partnership may
have for any commission of fraud made by any of the Contributors.
(f) Notwithstanding any other provision of this Second Amendment to
the contrary, the limitations set forth in subparagraphs (c) and (e) of
this paragraph 10 shall not apply to a claim for a breach of any
Representation or Warranty set forth in Sections 2.11 and 2.12 of the
Merger Agreement.
11. Security and Remedies.
---------------------
(a) Each of Harold S. Lichtin ("Lichtin") and Marie Antoinette
Robertson ("Robertson") hereby grants to the Partnership a lien upon and a
continuing security interest in 97,129 and 62,361, respectively, of the
Partnership Units issued to each of them pursuant to the Transaction
Documents at the date hereof (including the Partnership Units issued to
each of them pursuant to the distribution made by Perimeter Park West
Associates Limited Partnership described in paragraph 4 hereof) and the
shares of Common Stock acquired by them upon exercise of Rights with
respect to such Partnership Units (the "Collateral"), which shall be
security for the indemnification obligations of the Contributors under
paragraph 10 hereof. At the time of each Capital Contribution pursuant to
the Contribution Agreements, the number of shares of Common Stock and
Partnership Units constituting the Collateral shall be increased
proportionally between Lichtin and Robertson in the same ratio as the
Collateral is allocated between them in the preceding sentence (with
additional shares of Common Stock and/or Partnership Units not subject to
any Lien) by a number of shares of Common Stock and/or Partnership Units
having a value equal to the value provided for in Exhibit E hereto (based,
in the case of Partnership Units, on the Current Per Share Market Price at
such time of the number of shares of Common Stock for which such
Partnership Units could be redeemed if the General Partner assumed the
redemption obligation and elected to pay the Redemption Price (as defined
in Exhibit D) in shares of Common Stock (assuming
-10-
<PAGE>
the ownership limits in the Articles of Incorporation and in Exhibit D
would not prohibit the issuance of any such shares of Common Stock to
Lichtin or Robertson), and, in the case of shares of Common Stock, on the
Current Per Share Market Price at such time). At each anniversary of the
date hereof, the number of shares of Common Stock and the Partnership Units
constituting the Collateral shall be increased or decreased (proportionally
between Lichtin and Robertson as provided above) so that the value thereof
(based, in the case of Partnership Units, on the Current Per Share Market
Price at such time of the number of shares of Common Stock for which such
Partnership Units could be redeemed if the General Partner assumed the
redemption obligation and elected to pay the Redemption Price (as defined
in Exhibit D) in shares of Common Stock (assuming the ownership limits in
the Articles of Incorporation and in Exhibit D would not prohibit the
issuance of any such shares of Common Stock to Lichtin or Robertson), and,
in the case of shares of Common Stock, on the Current Per Share Market
Price at such time) is equal to the sum of (i) $5,000,000 plus (ii) all
----
amounts previously taken into account from Exhibit E (the "Aggregate
Maximum Liability"); provided, however, that in no event shall the
aggregate amount of the Collateral at any time exceed one-half of the total
number of shares of Common Stock and Partnership Units that all of the
Contributors own at that time. To the maximum extent possible under the
terms hereof, the Collateral shall consist of Partnership Units, rather
than shares of Common Stock. Except as otherwise provided in this Second
Amendment, the joint and several indemnification obligation of the
Contributors hereunder with respect to breaches of Representations and
Warranties shall be payable out of, and only out of, the entire Collateral;
provided, however, that the Contributors may satisfy all or any part of any
indemnification obligation of the Contributors in cash if the Contributors
unanimously so elect (in which case the Collateral shall be reduced
(proportionally between Lichtin and Robertson as provided above) by the
amount of cash so paid in satisfaction of any such indemnification
obligation). Any Transfer by Lichtin or Robertson of their respective
portion of the Collateral shall be subject to the lien and security
interest granted hereby. Whenever the amount of Collateral hereunder is to
-11-
<PAGE>
be increased or decreased, each of the Partnership, Lichtin and Robertson
will execute, deliver, record or file such documentation as may be
reasonably deemed necessary by the Partnership or Lichtin and Robertson to
effect the increase or decrease in such Collateral.
(b) In the event the General Partner or the Company asserts, within
the time period set forth in paragraph 9 hereof, that the Contributors have
an indemnification obligation to the Partnership, the General Partner or
the Company under paragraph 10 hereof, the General Partner or the Company,
as applicable, shall deliver written notice (the "Indemnification Notice")
to the Contributors describing in reasonable detail the circumstances
giving rise to such obligation and the amount thereof. If, within thirty
(30) days after the receipt of an Indemnification Notice, the Contributors
deliver written notice to the General Partner or the Company, as
applicable, indicating that the Contributors dispute the circumstances
giving rise to or the amount of such claimed indemnification obligation,
the General Partner or the Company, as applicable, may submit such matter
for binding arbitration in accordance with the provisions of Article XIV of
the Partnership Agreement by delivering a Demand Notice to the Contributors
pursuant to such Article XIV. If, after receiving timely notice of a
dispute hereunder from the Contributors, the General Partner or the
Company, as applicable, fails to so submit the matter for arbitration
within twenty (20) days after receipt of such notice from the Contributors,
then the Contributors shall be relieved of the claimed indemnification
obligation described in the Indemnification Notice. In the event the
Contributors (i) receive an Indemnification Notice and fail to timely
deliver notice to the General Partner or the Company, as applicable, of
their dispute as to the indemnification obligation and fail to make payment
within thirty (30) days after delivery of an Indemnification Notice or (ii)
have an indemnification obligation to the Partnership, the General Partner
or the Company under paragraph 10 hereof as determined pursuant to Article
XIV of the Partnership Agreement, and do not satisfy such obligation within
ten (10) days after the decision rendered in the arbitration, then, in
either event, the Partnership or the Company, as applicable, shall have any
and all remedies of a secured creditor under the Uniform Commercial Code,
-12-
<PAGE>
and, in addition thereto, at the election of the Partnership or the
Company, as applicable, the Partnership or the Company, as applicable,
shall, to the extent permitted by law, be deemed, without the payment of
any further consideration or the taking of any further action required by
the Contributors, to have acquired from the Contributors such portion of
the Collateral as shall be equal in value (based, in the case of
Partnership Units, on the Current Per Share Market Price as computed as of
the date immediately preceding such deemed acquisition of the number of
shares of Common Stock for which such Partnership Units could be redeemed
if the General Partner assumed the redemption obligation and elected to pay
the Redemption Price (as defined in Exhibit D) in shares of Common Stock
(assuming the ownership limits in the Articles of Incorporation would not
prohibit the issuance of any such shares of Common Stock to Lichtin or
Robertson), and, in the case of shares of Common Stock, on the Current Per
Share Common Stock Price computed as of the date immediately preceding such
deemed acquisition) to the amount recoverable from the Contributors under
paragraph 10 hereof. In the event the Partnership or the Company shall have
acquired from Lichtin or Robertson any Collateral pursuant to this
paragraph 11, the General Partner shall deliver written notice to the
Contributors within ten (10) days thereafter identifying the specific
Collateral acquired and, if such Collateral consists of Partnership Units,
the Percentage Interests of the Contributors following such acquisition.
Unless and until the Partnership shall have acquired from Lichtin or
Robertson any Collateral pursuant to this paragraph 11, Lichtin and
Robertson shall retain all rights with respect to the Collateral not
expressly limited herein or in the Partnership Agreement, including,
without limitation, rights to distributions provided for in the Partnership
Agreement and rights to dividends on shares of Common Stock. Lichtin and
Robertson hereby agree to take any and all actions and to execute and
deliver any and all documents or instruments necessary to perfect the
security interest created by this Second Amendment, including delivering
the certificates representing the Partnership Units or shares of Common
Stock to the General Partner. The lien and security interest provided for
by this paragraph 11 shall terminate on the first day following the
third anniversary of the date hereof; provided, however, that such lien and
-13-
<PAGE>
security interest imposed by this paragraph 11 shall be extended if there
has been delivered to the Contributors a Notice of Breach and the
indemnification obligation with respect thereto remains unsatisfied, or
there is pending a dispute with respect to such obligation, until such
dispute is finally resolved or satisfied in accordance with this paragraph
11.
12. Non-Recourse.
------------
(a) Notwithstanding anything contained in this Second Amendment or in
the Partnership Agreement to the contrary, but subject to subparagraph (b)
of this paragraph 12, the sole recourse of the General Partner, the
Partnership or the Company under paragraph 10 hereof with respect to
breaches of Representations and Warranties shall be against the Collateral,
and the Contributors shall have no personal liability with respect thereto.
However, nothing contained herein shall limit any remedy the Partnership
may have under the Contribution Agreements, including, without limitation,
the remedy of specific performance for any failure by the Contributors to
contribute a Development Property, a Northern Telecom Property or land
pursuant to the Contribution Agreements, or otherwise limit any remedy the
Partnership may have for any commission of fraud made by any of the
Contributors.
(b) Notwithstanding anything contained in subparagraph (a) of this
paragraph 12 or paragraphs 10 or 11 of this Second Amendment to the
contrary, (i) the recourse of the Company and the personal liability of the
Contributors with respect to a claim for a breach of any Representation or
Warranty set forth in Sections 2.11 or 2.12 of the Merger Agreement shall
not be limited to the Collateral, and (ii) following the termination of the
lien and security interest provided for under paragraph 11 of this Second
Amendment, the Contributors shall remain liable under paragraph 10 of this
Second Amendment for any claim for a breach of (A) any Representation or
Warranty relating to any property contributed to the Partnership subsequent
to the date hereof as contemplated under paragraph 5 of this Second
-14-
<PAGE>
Amendment and (B) any Representation or Warranty contained in the Merger
Agreement (other than any Representation or Warranty set forth in Sections
2.11 or 2.12 of the Merger Agreement), in each case until the expiration of
the Survival Period applicable to a claim for a breach of any such
Representation or Warranty; provided, however, that the liability of the
Contributors under this clause (ii) shall be limited to the Aggregate
Maximum Liability (reduced by the amount of any cash previously paid or
Collateral previously acquired in satisfaction of any indemnification
obligation under paragraphs 10 and 11 hereof) as if such lien and security
interest had not terminated.
13. Restriction on Transfer. In connection with the security interest
-----------------------
granted by Lichtin and Robertson under paragraph 11 hereof, each of Lichtin and
Robertson agrees that any shares of Common Stock and any portion of Lichtin's
and Robertson's Partnership Interests included in the Collateral shall not be
Transferred without the consent of the General Partner until the third
anniversary of the date hereof; provided, however, that Lichtin or Robertson may
Transfer all or any portion of such shares of Common Stock or Partnership
Interests to an Affiliate of such person (so long as such Affiliate remains an
Affiliate of such person), subject to the prior security interest granted in
paragraph 11 hereof and to the restrictions contained in Article IX of the
Partnership Agreement; provided further, however, that the restrictions imposed
by this paragraph 13 shall be extended with respect to Lichtin and Robertson if
there has been delivered to the Contributors a Notice of Breach and the
indemnification obligation with respect thereto remains unsatisfied, or there is
pending a dispute with respect to such obligation, until such dispute is finally
resolved or satisfied in accordance with paragraph 11 hereof. Notwithstanding
the foregoing, Lichtin and Robertson may, with the consent of the General
Partner in its sole and absolute discretion, be relieved of the restrictions on
transferability contained in this paragraph 13 by (a) consenting to personal
liability (by execution and delivery of an agreement to such effect in form and
substance reasonably satisfactory to the General Partner) for any
indemnification obligations secured by a Partnership Interest or Common Stock,
or (b) pledging (by execution and delivery of a pledge agreement or amendment to
this Second Amendment in form and substance reasonably satisfactory to the
-15-
<PAGE>
General Partner) substitute collateral that, in the reasonable determination of
the General Partner, is substantially equivalent in value to the Partnership
Interests or Common Stock described in this paragraph 13. In the event that
Lichtin and Robertson are relieved of the restrictions on transferability in
accordance with the terms of this paragraph 13, the security interest in the
Partnership Interests and Common Stock granted to the General Partner, the
Partnership and the Company pursuant to paragraph 11 hereof shall terminate
without further action, and the Partnership and the Company, at the request of
Lichtin or Robertson, shall promptly execute and deliver any document or
instrument reasonably requested by Lichtin or Robertson to evidence such
termination. Upon exercise of the Rights with respect to any Partnership Units
included in the Collateral, the Partnership, in perfection of the security
interest herein granted, shall retain the certificate(s) representing the
portion, if any, of the Common Stock issued upon such exercise that is included
in the Collateral; provided, however, that any such certificate shall be
returned to Lichtin and Robertson upon termination of the security interest in
accordance with the terms of this Second Amendment. If any portion of the
Partnership Interests of the Contributors included in the Collateral is
represented by certificates, the Partnership shall retain such certificates in
perfection of the security interest herein granted; provided, however, that any
such certificate shall be returned to Lichtin and Robertson upon termination of
the security interest in accordance with the terms of this Second Amendment.
14. Tax Considerations. During the five-year period commencing on the date
------------------
hereof, the General Partner agrees that (i) in the event it elects to cause the
Partnership to sell or otherwise convey any of the properties contributed to the
Partnership pursuant to this Second Amendment (each, a "Contributed Property"),
the General Partner will endeavor to structure any such sale or conveyance of a
Contributed Property as a tax-deferred like-kind exchange under section 1031 of
the Code to the extent such sale or conveyance would result in the recognition
of gain for federal income tax purposes by one or more of the Contributors, and
(ii) the General Partner will endeavor not to pay down or otherwise reduce
(other than through regularly scheduled payments of principal and interest) the
amount of nonrecourse indebtedness to which a Contributed Property is subject,
to the extent that such reduction would cause one or more of the Contributors to
-16-
<PAGE>
recognize gain for federal income tax purposes. The foregoing sentence shall not
apply to gain recognized by a Contributor as a result of cash distributions made
by the Partnership in the ordinary course of its operations subsequent to any
such reduction in nonrecourse indebtedness. Notwithstanding the foregoing, the
General Partner shall have the right to sell Contributed Properties in one or
more transactions taxable in whole or in part, or to pay down or refinance
nonrecourse debt secured by a Contributed Property, if the General Partner
determines, in good faith, that such action is in the best economic interest of
the Partnership and the Partners (without taking into account the tax
consequences of such action on the Contributors), and, in such event, the
General Partner agrees to provide reasonable advance notice to the Contributors
of such actions and to cooperate with the Contributors in avoiding, to the
extent feasible, any substantial adverse federal income tax consequences to the
Contributors resulting from such actions (including, for example, by allowing
the Contributors to assume deficit capital account responsibility or by
facilitating guarantees of other Partnership nonrecourse indebtedness by the
Contributors).
15. Indemnification for Assumed Indebtedness. The Partnership shall, as
----------------------------------------
soon as practicable, pay and discharge in full the following loans assumed by
the Partnership in connection with the contribution of property to the
Partnership pursuant to the Transaction Documents: (i) First Union National
Bank of North Carolina ("FUNB") loan number 373894 having a pay-off as of the
date hereof of $2,651,532.87; (ii) FUNB loan number 394973 respecting building
1500 of Perimeter Park West having a pay-off as of the date hereof of
$6,276,323.50; (iii) FUNB loan number 416727 respecting Enterprise II having a
pay-off as of the date hereof of $5,877,783.81; and (iv) those liabilities set
forth in Schedule 1.03 to that certain Contribution Agreement of even date
herewith between Harold S. Lichtin and the Partnership. The Partnership shall
indemnify and hold harmless each of the Contributors from all liabilities,
demands, claims, actions, assessments, losses, fines, penalties, costs, damages
and expenses (including, without limitation, reasonable attorneys' and
accountants' fees and expenses) sustained or incurred by any such Contributor as
a consequence of circumstances arising after the date hereof under any loan,
capitalized lease, credit line, or other indebtedness relating to any property
-17-
<PAGE>
or asset contributed to the Partnership pursuant to any Transaction Document,
including, without limitation, any Existing Loan Document or Existing Loan
assumed by the Partnership pursuant to Section 7.1 of that certain Contribution
Agreement for Completed Properties Lichtin Portfolio of even date herewith among
the Partnership and the Contributors.
16. Miscellaneous. This Amendment shall be governed by and construed in
-------------
conformity with the laws of the State of Georgia. For the purposes of the
notice provisions of the Partnership Agreement, the address of each of the
Contributors is as set forth on the signature page hereof. Except as expressly
amended hereby, the Partnership Agreement shall remain in full force and effect.
This Second Amendment and all the terms and provisions hereof shall be binding
upon and shall inure to the benefit of the parties, and their legal
representatives, heirs, successors and permitted assigns.
-18-
<PAGE>
IN WITNESS WHEREOF, the parties have executed and delivered this Second
Amendment as of the date first above written.
WEEKS REALTY, L.P., a Georgia limited
partnership authorized to do business in the
State of North Carolina as Weeks Realty Limited
Partnership
By: Weeks GP Holdings, Inc., a Georgia
corporation, its Sole General Partner
By:
-----------------------------------------
Name:
Title:
CONTRIBUTORS:
-----------------------------------------
HAROLD S. LICHTIN
Address: 1800 Perimeter Park Drive
Suite 200
Morrisville, NC 27560
-----------------------------------------
MARIE ANTOINETTE ROBERTSON
Address: c/o First Rock, Inc.
1525 The 600 Building
Corpus Christi, Texas 78473
-19-
<PAGE>
-----------------------------------------
AMY R. EHRMAN
Address: c/o First Rock, Inc.
1525 The 600 Building
Corpus Christi, Texas 78473
-----------------------------------------
ROLAND G. ROBERTSON
Address: c/o First Rock, Inc.
1525 The 600 Building
Corpus Christi, Texas 78473
-----------------------------------------
NOEL A. LICHTIN
Address: 1800 Perimeter Park Drive
Suite 200
Morrisville, NC 27560
PERIMETER PARK WEST ASSOCIATES LIMITED
PARTNERSHIP
By:
-------------------------------------------
Harold S. Lichtin, General Partner
By:
-------------------------------------------
Marie Antoinette Robertson, General Partner
Address: 1800 Perimeter Park Drive
Suite 200
Morrisville, NC 27560
-20-
<PAGE>
Solely for purposes of paragraphs 8, 9, 10,
11 and 12 and Exhibit D hereto:
WEEKS CORPORATION
By:
---------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
-21-
<PAGE>
Exhibit A
---------
TRANSACTION DOCUMENTS
<PAGE>
Exhibit B
---------
CAPITAL CONTRIBUTION:
- --------------------
Harold S. Lichtin Capital Contribution: All assets, properties and businesses
transferred from Harold S. Lichtin at
December 31, 1996, to the Partnership
pursuant to the Transaction Documents
(as defined in the foregoing Second
Amendment)
Marie Antoinette Robertson All assets, properties and businesses
Capital Contribution: transferred from Marie Antoinette
Robertson at December 31, 1996, to
the Partnership pursuant to the
Transaction Documents (as defined in
the foregoing Second Amendment)
Amy R. Ehrman Capital Contribution: All assets, properties and businesses
transferred from Amy R. Ehrman at
December 31, 1996, to the Partnership
pursuant to the Transaction Documents
(as defined in the foregoing Second
Amendment)
Roland G. Robertson Capital Contribution: All assets, properties and businesses
transferred from Roland G. Robertson
at December 31, 1996, to the
Partnership pursuant to the
Transaction Documents (as defined in
the foregoing Second Amendment)
Noel A. Lichtin Capital Contribution: All assets, properties and
businesses transferred from Noel A.
Lichtin at December 31, 1996, to the
Partnership pursuant to the
Transaction Documents (as defined in
the foregoing Second Amendment)
Perimeter Park West Associates All assets, properties and businesses
Limited Partnership Contribution transferred from Perimeter Park West
Associates Limited Partnership at
December 31, 1996, to the Partnership
pursuant to the Transaction Documents
(as defined in the foregoing Second
Amendment)
B-1
<PAGE>
GROSS FAIR MARKET VALUE OF PROPERTY CONTRIBUTIONS:
- -------------------------------------------------
Gross Fair Market Value of all
property other than money included in
Harold S. Lichtin Capital Contribution: $ 1,652,107.50/1/
Gross Fair Market Value of all
property other than money included in
Marie Antoinette Robertson Capital
Contribution: 69,336.50/1/
Gross Fair Market Value of all
property other than money included in
Amy R. Ehrman Capital Contribution: 0.00/1/
Gross Fair Market Value of all
property other than money included in
Roland G. Robertson Capital Contribution: 0.00/1/
Gross Fair Market Value of all
property other than money included in
Noel A. Lichtin Capital Contribution: 31,007.00/1/
Gross Fair Market Value of all
property other than money included in
Perimeter Park West Associates
Limited Partnership Capital Contribution: 12,525,388.75/1/
- ---------------------
/1/Gross Fair Market Value of property contributed by each Contributor does
not reflect the value attributable to the Partnership Interests distributed
to certain partners of Perimeter Park West Associates Limited Partnership.
B-2
<PAGE>
ALLOCATION OF PARTNERSHIP UNITS:
- -------------------------------
Partnership Units Issued to Contributors:
- ----------------------------------------
<TABLE>
<CAPTION>
Contributor No. of Units
----------- ------------
<S> <C>
Harold S. Lichtin 65,430
Marie Antoinette Robertson 2,746
Amy R. Ehrman -0-
Roland G. Robertson -0-
Noel A. Lichtin 1,228
Perimeter Park West Associates
Limited Partnership 496,055
Partnership Units Held Following Distribution by Perimeter Park West Associates
- -------------------------------------------------------------------------------
Limited Partnership:
- -------------------
Contributor No. of Units
----------- ------------
Harold S. Lichtin 226,076
Marie Antoinette Robertson 241,352
Amy R. Ehrman 2,053
Roland G. Robertson 2,053
Noel A. Lichtin 1,228
Perimeter Park West Associates
Limited Partnership 92,697
</TABLE>
B-3
<PAGE>
Exhibit C
---------
PARTNERSHIP UNITS/PERCENTAGE INTERESTS
All Partners
<TABLE>
<CAPTION>
Partner Units Percentage Interest/1/
- ------- ----- ----------------------
<S> <C> <C>
Weeks GP Holdings, Inc. 237,503 1.282%
Weeks LP Holdings, Inc. 13,805,088 74.510%
NWI Warehouse Group, L.P. 1,332,261 7.191%
A. Ray Weeks, Jr. 774,685 4.181%
John P. Weeks 239,791 1.294%
Marsha L. Weeks 228,047 1.231%
Trust U/W/2/ 212,663 1.148%
Patricia L. Weeks 206,607 1.115%
Deborah Weeks Felker 198,339 1.070%
Trust B/3/ 187,492 1.012%
Weeks Horizon Corp. 116,012 0.626%
Oakdale Land Management, Inc. 110,493 0.596%
Weeks Hillside Corp. 78,145 0.422%
Thomas D. Senkbeil 52,817 0.285%
Weeks Southridge Corp. 42,993 0.232%
Forrest W. Robinson 28,877 0.156%
Harry T. Weeks 27,535 0.149%
Louis C. Robinson 20,016 0.108%
Buckley & Company Real Estate, Inc. 20,000 0.108%
HV, Inc. 17,074 0.092%
Clyde H. Duckett 5,627 0.030%
John C. Atwell 5,627 0.030%
Robert G. Cutlip 5,138 0.028%
</TABLE>
- -------------------
/1/ Reflects distribution of a portion of the Partnership Units held by
Perimeter Park West Associates Limited Partnership to certain of its partners.
/2/ A. R. Weeks, Jr., as Trustee U/W of Alvin Ray Weeks dated March 1,
1983, f/b/o Marsha Lee Weeks, A. R. Weeks, Jr., Deborah Weeks Felker, Patricia
Louise Weeks and John Phillip Weeks.
/3/ Harry T. Weeks, A. R. Weeks, Jr., and Martha Patterson Weeks as
Trustees under Trust Agreement dated 10/27/76, as amended, f/b/o Marsha Lee
Weeks, A. R. Weeks, Jr., Deborah Weeks Felker, Patricia Louise Weeks and John
Phillip Weeks.
C-1
<PAGE>
<TABLE>
<CAPTION>
Partner Units Percentage Interest/1/
- ------- ----- ----------------------
<S> <C> <C>
Klay W. Simpson 4,110 0.022%
Helen B. Weeks 2,442 0.013%
Mark W. Flowers 1,541 0.008%
Weeks Management Corp. 1,142 0.006%
RTF Management Corp. 257 0.001%
Marie Antoinette Robertson 241,352 1.303%
Harold S. Lichtin 226,076 1.220%
Perimeter Park West Associates
Limited Partnership 92,697 0.500%
Amy R. Ehrman 2,053 0.011%
Roland G. Robertson 2,053 0.011%
Noel A. Lichtin 1,228 0.007%
</TABLE>
Total __________ ________
18,527,781 100.000%
========== ========
C-2
<PAGE>
Exhibit D
---------
RIGHTS TERMS
------------
The Rights granted by the Partnership to the Contributors (referred to
in this Exhibit as "Limited Partners"), pursuant to paragraph 3(b) of the
foregoing Second Amendment shall be subject to the following terms and
conditions:
1. Definitions. Capitalized terms used in this Exhibit without
-----------
definition shall have the meanings given to them in the Partnership Agreement or
the foregoing Second Amendment, as applicable, and the following terms and
phrases shall, for purposes of this Exhibit D, the Partnership Agreement and the
foregoing Second Amendment, have the meanings set forth below:
"Cash Purchase Price" shall have the meaning set forth in Paragraph 4
-------------------
hereof.
"Closing Notice" shall mean the written notice to be given by the
--------------
General Partner to the Exercising Partner(s) in response to the receipt by the
General Partner of a Conversion Exercise Notice from such Exercising Partner(s).
The form of the Closing Notice is attached hereto as Schedule 2.
"Computation Date" shall mean the date on which a Conversion Exercise
----------------
Notice is delivered to the General Partner.
"Conversion Exercise Notice" shall have the meaning set forth in
--------------------------
Paragraph 2 hereof.
"Conversion Factor" shall mean 100%, provided that such factor shall
-----------------
be adjusted in accordance with the provisions of paragraph 10 hereof.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
------------
amended, or any successor statute.
"Exercising Partners" shall have the meaning set forth in Paragraph 2
-------------------
hereof.
"Offered Partnership Units" shall mean the Partnership Units of the
-------------------------
Exercising Partner(s) identified in a Conversion Exercise Notice that, pursuant
to the exercise of Rights, must be redeemed by the Partnership or acquired by
the General Partner and/or Weeks LP Holdings under the terms hereof.
<PAGE>
"Redemption Price" shall mean the Cash Purchase Price or the Stock
----------------
Purchase Price.
"Rights" shall have the meaning set forth in paragraph 3(b) of the
------
foregoing Second Amendment.
"Securities Act" shall mean the Securities Act of 1933, as amended, or
--------------
any successor statute.
"Stock Purchase Price" shall have the meaning set forth in Paragraph 4
--------------------
hereof.
2. Delivery of Conversion Exercise Notices. Any one or more Limited
---------------------------------------
Partners ("Exercising Partners") may, subject to the limitations set forth
herein, deliver to the General Partner written notice (the "Conversion Exercise
Notice") pursuant to which such Exercising Partners elect to exercise the
Rights. The form of Conversion Exercise Notice is attached hereto as Schedule
1.
3. Limitations on Exercise of Rights; Deemed Exercise.
--------------------------------------------------
(a) No Conversion Exercise Notice, with respect to any Unit
(except for those Units described in the immediately following
subparagraph (b)), may be delivered to the General Partner by a
Limited Partner until the later of (i) the date which is the later of
(A) one year following the issuance of the last Units which are issued
with respect to the Development Properties or the Northern Telecom
Properties or (B) the third anniversary of the date hereof, or (ii)
the date on which either (A) there is a registration statement
effective under the Securities Act with respect to the issuance of any
shares of Common Stock that could be issued to such Limited Partner
pursuant to such exercise of Rights and with respect to any resale by
such Limited Partner of any of such shares of Common Stock, or (B) in
the opinion of counsel to Weeks, shares of Common Stock that could be
issued to such Limited Partner pursuant to such exercise of Rights may
be issued without registration under the Securities Act.
(b) With respect to Units issued in exchange for Perimeter Park
West, Metro Center and Perimeter Park Land, no Conversion Exercise
Notice may be delivered to the General Partner by a Limited Partner
until the later of (i) the date which is the later of (A) one year
following the closing date for the acquisition of such Perimeter Park
West, Metro Center and Perimeter Park Land or (B) the expiration of
the last lock-up period described in Paragraph 3(a)(i) above, or (ii)
the date on which either (A) there is a registration statement
effective under the Securities Act with respect to the issuance of any
shares of Common Stock that could be issued to such Limited Partner
pursuant to such exercise of Rights and with respect to any resale by
such Limited Partner of any of such shares of Common Stock, or (B) in
-2-
<PAGE>
the opinion of counsel to Weeks, shares of Common Stock that could be
issued to such Limited Partner pursuant to such exercise of Rights may
be issued without registration under the Securities Act.
(c) A Limited Partner may not exercise the Rights for less than
one thousand (1,000) Partnership Units or, if such Limited Partner
holds less than one thousand (1,000) Partnership Units, all of the
Partnership Units held by such Limited Partner.
(d) Neither the General Partner nor the Partnership shall have
any obligation or authority to redeem or purchase Offered Partnership
Units to the extent that issuance of shares of Common Stock in payment
of the Stock Purchase Price for any part of the Offered Partnership
Units would result (i) in the violation of the General Ownership Limit
(as such term is defined in the Articles of Incorporation), (ii) would
cause Weeks to fail the stock ownership test of Section 856(a)(6) of
the Code, or (iii) would otherwise cause Weeks to fail to qualify as a
REIT; provided that in any such case, the General Partner or the
Partnership shall purchase for cash those offered Partnership Units
which may not be redeemed with shares of Common Stock. Each Exercising
Partner shall provide to the General Partner such information as the
General Partner may request regarding such Exercising Partner's actual
and constructive ownership of Common Stock (and of individuals, and
entities related to such Exercising Partner) in order for the General
Partner to determine, in its sole discretion, whether a purchase or
redemption of the Offered Partnership Units for shares of Common Stock
would result in a violation of such restrictions.
(e) If, after complying with all applicable provisions of the
Partnership Agreement, any Person with an ownership interest in any of
the Contributors becomes the owner of any Partnership Units previously
owned by the any of the Contributors, such Person may exercise the
Rights granted with respect to such Partnership Units in accordance
with the terms hereof.
4. Computation of Redemption Price/Form of Payment. The Redemption
-----------------------------------------------
Price payable by the Partnership to each Exercising Partner for the Offered
Partnership Units shall be payable, at the election of the General Partner, by
the delivery by the Partnership of the Redemption Price. Notwithstanding the
foregoing, at the election of the General Partner, the Redemption Price may be
the Stock Purchase Price for part of the Offered Partnership Units and the Cash
Purchase Price for the remainder of the Offered Partnership Units. The "Stock
Purchase Price" shall mean the number of shares of Common Stock equal to the
product, expressed as a whole number, of (i) the number of Offered Partnership
Units, multiplied by (ii) the Conversion Factor. The "Cash Purchase Price"
shall mean an amount of cash (in immediately available funds) equal to (i) the
number of shares of Common Stock that would be issued to the Exercising Partner
if the Stock Purchase Price were paid for such Offered Partnership Units,
multiplied by (ii) the Current Per Share Market Price computed as of the
Computation Date. To the extent the Partnership elects to pay the Stock
-3-
<PAGE>
Purchase Price, it shall obtain the necessary shares of Common Stock in exchange
for the issuance of additional Partnership Interests to the General Partner,
Weeks LP Holdings, or any combination thereof, as determined by the General
Partner in its sole discretion, and the General Partner and/or Weeks LP Holdings
shall obtain the necessary shares of Common Stock in exchange for the issuance
of additional capital stock to Weeks.
5. Closing; Delivery of Closing Notice. The closing of the redemption of
-----------------------------------
Offered Partnership Units shall, unless otherwise mutually agreed, be held at
the principal office of the Partnership, as follows:
(a) Within ten (10) days after the receipt by the Partnership of
the Conversion Exercise Notice, the Partnership shall deliver a Closing
Notice to the Exercising Partner(s). The Closing Notice shall state a date
for the closing of the redemption of the Offered Partnership Units, which
date shall not be later than the later of (i) twenty (20) days after the
receipt by the Partnership of the Conversion Exercise Notice (forty-five
(45) days as to the Offered Partnership Units for which the Cash Purchase
Price will be paid), and (ii) the first (1st) business day after the
expiration or termination of the waiting period applicable to each
Exercising Partner, if any, under the Hart-Scott Act.
(b) If applicable, the Closing Notice shall (i) specify the
Partnership's election to pay the Cash Purchase Price for some or all of
the Offered Partnership Units and (ii) set forth the computation of the
Cash Purchase Price to be paid by the Partnership to such Exercising
Partner(s). The Cash Purchase Price shall be paid by wire transfer of
immediately available funds to such account of the Exercising Partner as is
designated in the Conversion Exercise Notice.
6. Assumption by the General Partner and/or Weeks LP Holdings.
----------------------------------------------------------
Notwithstanding anything in this Exhibit D to the contrary, the General Partner,
Weeks LP Holdings or any combination thereof (an "Assumer" or, collectively, the
"Assumers") may, in the sole and absolute discretion of the General Partner,
assume directly and satisfy the exercise of a Right by paying the Electing
Partner the Redemption Price. In such event, the Assumers shall acquire the
Offered Partnership Units and shall be treated for all purposes of this
Agreement as the owner of such Partnership Units, which shall be held by the
Assumers in their respective existing capacities as general partner or Limited
Partners, as the case may be. In the event the General Partner shall exercise
the Assumers' right to satisfy a Right in the manner described in this Paragraph
6, the Partnership shall have no obligation to pay any amount to the Exercising
Partner with respect to such Exercising Partner's exercise of a Right; provided,
however, that the Partnership shall remain liable to the Exercising Partner to
the extent that any such Exercising Partner's Right is not fully satisfied; and
each of the Exercising Partner, the Partnership, and the Assumers shall treat
the transaction between the Assumers and the Exercising Partner as a sale of the
Exercising Partner's Partnership Units to the Assumers for federal income tax
purposes. To the extent the Assumers elect to pay the Stock Purchase Price, they
shall obtain the necessary shares of Common Stock in exchange for the issuance
-4-
<PAGE>
of additional capital stock to Weeks. Each Exercising Partner agrees to execute
such documents as the General Partner may reasonably require in connection with
the issuance of Common Stock upon exercise of a Right.
7. Closing Deliveries. At the closing, payment of the Redemption Price
------------------
shall be accompanied by proper instruments of transfer and assignment for the
Offered Partnership Units and by the delivery of (i) representations and
warranties of (A) the Exercising Partner with respect to its due authority to
sell all of the right, title and interest in and to the Offered Partnership
Units and with respect to the status of the Offered Partnership Units being
sold, free and clear of all Liens, and (B) the Partnership or the Assumers, as
applicable, with respect to due authority for the redemption or purchase of such
Offered Partnership Units, and (ii) to the extent that shares of Common Stock
are issued in payment of the Stock Purchase Price, (A) an opinion of counsel for
Weeks, reasonably satisfactory to the Exercising Partner(s), to the effect that
such shares of Common Stock have been duly authorized, are validly issued,
fully-paid and nonassessable, and (b) a stock certificate or certificates
evidencing the Common Stock to be issued and registered in the name of the
Exercising Partner(s) or its (their) designee.
8. Covenants of Weeks. To facilitate the Partnership's and the Assumers'
------------------
ability to fully perform their obligations hereunder, Weeks covenants and agrees
as follows:
(a) At all times during the pendency of the Rights, Weeks shall
reserve for issuance such number of shares of Common Stock as may be
necessary to enable Weeks to issue shares of Common Stock in full payment
of the Stock Purchase Price in regard to all Partnership Units that are
from time to time outstanding and with respect to which Rights exist.
(b) During the pendency of the Rights, the Limited Partners shall
receive in a timely manner all communications transmitted from time to time
by Weeks to its shareholders generally.
9. Limited Partners' Covenants. Each Limited Partner covenants and agrees
---------------------------
that all Offered Partnership Units tendered in accordance with the exercise of
Rights shall be delivered free and clear of all Liens. Should any Liens exist or
arise with respect to such Offered Partnership Units, neither the Assumers nor
the Partnership shall be under any obligation to redeem or acquire the same
unless, in connection therewith, the General Partner has elected to pay a
portion of the Redemption Price in the form of the Cash Purchase Price in
circumstances in which such Cash Purchase Price will be sufficient to cause such
existing Lien to be discharged in full upon application of all or a part of the
Cash Purchase Price. The Partnership and the Assumers are expressly authorized
to apply such portion of the Cash Purchase Price as may be necessary to
discharge such Lien in full. Each Limited Partner further agrees that, in the
event any state or local property transfer tax is payable as a result of the
transfer of its Offered Partnership Units to the Partnership or the Assumers,
such Limited Partner shall assume and pay such transfer tax.
-5-
<PAGE>
10. Antidilution Provisions
-----------------------
(a) The Conversion Factor shall be subject to adjustment from
time to time effective upon the occurrence of the following events and
shall be expressed as a percentage, calculated to the nearest one-
thousandth of one percent (.001%):
(i) In case Weeks shall pay or make a dividend or other
distribution on any class of stock of Weeks in shares of Common Stock,
the Conversion Factor in effect at the opening of business on the day
following the date fixed for the determination of shareholders entitled
to receive such dividend or other distribution shall be increased in
proportion to the increase in outstanding shares of Common Stock
resulting from such dividend or other distribution, such increase to
become effective immediately after the opening of business on the day
following the record date fixed for such dividend or other
distribution.
(ii) In case outstanding shares of Common Stock shall be
subdivided into a greater number of shares, the Conversion Factor in
effect at the opening of business on the day following the day upon
which such subdivision becomes effective shall be proportionately
increased, and, conversely, in case the outstanding shares of Common
Stock shall be combined into a smaller number of shares, the Conversion
Factor in effect at the opening of business on the day following the
day upon which such combination becomes effective shall be
proportionately reduced, such increase or reduction, as the case may
be, to become effective immediately after the opening of business on
the day following the day upon which such subdivision or combination
becomes effective.
(b) In case Weeks shall issue rights, options or warrants to all
holders of its shares of Common Stock entitling them to subscribe for or
purchase Common Stock or other securities convertible into shares of Common
Stock at a price per share less than the Current Per Share Market Price as
of the day before the "ex date" with respect to the issuance or
distribution, each Limited Partner holding Rights shall be entitled to
receive such number of such rights, options or warrants, as the case may
be, as he would have been entitled to receive had he exercised all of his
then existing Rights immediately prior to the record date for such issuance
by Weeks. The term "ex date" shall mean the first date on which shares of
Common Stock trade regular way without the right to receive such issuance
or distribution.
(c) In case the shares of Common Stock shall be changed into the same
or a different number of shares of any class or classes of stock, whether
by capital reorganization, reclassification, or otherwise (other than
subdivision or combination of shares described in subparagraph (a) (ii) of
this Paragraph), then and in each such event the Limited Partners holding
Rights shall have the right thereafter to exercise their Rights for the
kind and amount of shares and other securities and property that would have
-6-
<PAGE>
been received upon such reorganization, reclassification or other change by
holders of the number of shares of Common Stock with respect to which such
Rights could have been exercised immediately prior to such reorganization,
reclassification or change.
(d) The General Partner may, but shall not be required to, make such
adjustments to the number of shares of Common Stock issuable upon exercise
of Rights, in addition to those required by this Paragraph 10, as the
General Partner considers to be advisable in order that any event treated
for federal income tax purposes as a dividend of stock or stock rights
shall not be taxable to the recipients. The General Partner shall have the
power to resolve any ambiguity or correct any error in the adjustments made
pursuant to this Paragraph and its actions in so doing shall be final and
conclusive, absent manifest error by the General Partner in taking such
action.
11. Fractions of Shares. No fractional shares of Common Stock shall be
-------------------
issued upon exercise of Rights. If Rights shall be exercised with respect to
more than one Offered Partnership Unit at one time by the same Exercising
Partner, the number of full shares of Common Stock comprising the Stock Purchase
Price (or the cash equivalent amount thereof to the extent the Cash Purchase
Price is paid) shall be computed on the basis of the aggregate number of Offered
Partnership Units. Instead of any fractional share of Common Stock that would
otherwise be issuable upon exercise of Rights, the Partnership or the Assumers
shall pay a cash adjustment in respect of such fraction in an amount equal to
the Cash Purchase Price computed hereunder for such fraction of a share.
12. Notice of Adjustments of Conversion Factor. Whenever the Conversion
------------------------------------------
Factor is adjusted as herein provided:
(a) the General Partner shall compute the adjusted Conversion
Factor in accordance with Paragraph 10 hereof and shall prepare a
certificate signed by the chief financial officer or the Treasurer of the
General Partner setting forth the adjusted Conversion Factor and showing in
reasonable detail the facts upon which such adjustment is based; and
(b) notice stating that the Conversion Factor has been adjusted
and setting forth the adjusted Conversion Factor shall forthwith be mailed
by the General Partner to all holders of Rights at their last addresses on
record under this Agreement.
13. Notice of Certain Corporate Actions.
-----------------------------------
In case:
(a) Weeks shall declare a dividend (or any other distribution) on
its Common Stock payable otherwise than in cash; or
-7-
<PAGE>
(b) Weeks shall authorize the granting to the holders of its
Common Stock of rights, options or warrants to subscribe for or purchase
any shares of stock of any class or of any other rights; or
(c) of any reclassification of the shares of Common Stock (other
than a subdivision or combination of its outstanding Common Stock, or of
any consolidation, merger or share exchange to which Weeks is a party and
for which approval of any shareholders of Weeks is required), or of the
sale or transfer of all or substantially all of the assets of Weeks; or
(d) of the voluntary or involuntary dissolution, liquidation or
winding up of Weeks;
then the General Partner shall cause to be mailed to all holders of Rights at
their last addresses on record under this Agreement, at least 20 days (or 12
days in any case specified in clause (a) or (b) above) prior to the applicable
record date hereinafter specified, a notice stating (i) the date on which a
record is to be taken for the purpose of such dividend, distribution, rights,
options or warrants, or, if a record is not to be taken, the date as of which
the holders of shares of Common Stock of record to be entitled to such dividend,
distribution, rights, options or warrants are to be determined, or (ii) the date
on which such reclassification, consolidation, merger, share exchange, sale,
transfer, dissolution, liquidation or winding up is expected to become
effective, and the date as of which it is expected that holders of shares of
Common Stock of record shall be entitled to exchange their shares for
securities, cash or other property deliverable upon such reclassification,
consolidation, merger, share exchange, sale, transfer, dissolution, liquidation
or winding up.
14. Provisions in Case of Consolidation, Merger or Sale of Assets.
-------------------------------------------------------------
In case of any consolidation of Weeks with, or merger of Weeks into, any
other Person, any merger or consolidation of another Person into Weeks (other
than a merger that does not result in any reclassification, conversion, exchange
or cancellation of outstanding shares of Common Stock), any acquisition of the
outstanding Common Stock by share exchange, or any sale or transfer of all or
substantially all of the assets of Weeks, the Person formed by such
consolidation or resulting from such merger or that acquires the outstanding
Common Stock or such assets of Weeks as the case may be, shall execute and
deliver to each holder of Rights an agreement providing that such holder shall
have the right thereafter, during the period such rights shall be exercisable
(which shall be at least as long as the period for which the Rights can be
exercised under the other provisions of this Agreement), to exercise the Rights
for the kind and amount of securities, cash and other property receivable upon
such consolidation, merger, share exchange, sale or transfer by a holder of the
number of shares of Common Stock for which the Rights might have been exercised
immediately prior to such consolidation, merger, share exchange, sale or
transfer, assuming both that (a) such holder of shares of Common Stock is not a
Person with which Weeks consolidated or into which Weeks merged or that merged
-8-
<PAGE>
into Weeks, or that acquired the outstanding Common Stock by share exchange, or
to which such sale or transfer was made, as the case may be (a "Constituent
Person"), or an Affiliate of a Constituent Person, and that (b) such holder does
not exercise his right of election, if any, as to the kind or amount of
securities, cash or other property receivable upon such consolidation, merger,
share exchange, sale or transfer (provided that if the kind or amount of
--------
securities, cash and other property receivable upon such consolidation, merger,
share exchange, sale or transfer is not the same for each share of Common Stock
in respect of which such right of election, if any, is not exercised ("non-
electing Share"), then for the purpose of this Paragraph 14, the kind and amount
of securities, cash and other property receivable upon such consolidation,
merger, share exchange, sale or transfer by each non-electing Share shall be
deemed to be the kind and amount so receivable per non-electing Share by a
plurality of the non-electing Shares). Such agreement shall provide for
adjustments that, for events subsequent to the effective date of such agreement,
shall be as nearly equivalent as may be practicable to the adjustments provided
for in this Exhibit D.
The above provisions of this Paragraph 14 shall similarly apply to
successive consolidations, mergers, sales or transfers.
-9-
<PAGE>
SCHEDULE 1
CONVERSION EXERCISE NOTICE
--------------------------
To: Weeks Realty, L.P.
Reference is made to that certain Second Amendment (the "Second Amendment")
to the Second Amended and Restated Agreement of Limited Partnership of Weeks
Realty, L.P. (the "Partnership"). Capitalized terms used but not defined herein
shall have the meanings set forth in Second Amendment. Pursuant to Exhibit D to
the Second Amendment, the undersigned, being a limited partner of the
Partnership (an "Exercising Partner"), hereby elects to exercise its Rights as
to the number of Offered Partnership Units specified opposite its name below:
Number of Offered
Exercising Limited Partner Partnership Units
- -------------------------- -----------------
---------------------------------------
Signature of Exercising Limited Partner
Date:
----------------------------------
<PAGE>
SCHEDULE 2
CLOSING NOTICE
--------------
To: Exercising Limited Partner(s)
Reference is made to that certain Second Amendment (the "Second
Amendment") to the Second Amended and Restated Agreement of Limited Partnership
of Weeks Realty, L.P. (the "Partnership"). Capitalized terms used but not
defined herein shall have the meaning set forth in Second Amendment. The
closing of the redemption of the Offered Partnership Units shall occur at
, , Georgia, on . Pursuant to Exhibit D to the Second
- ------- -------- -----------
Amendment, the Partnership hereby notifies the Exercising Partner(s) that it has
elected to pay the Cash Purchase Price to the Exercising Partner(s) for the
number of Offered Partnership Units set forth below, and that the computation of
the Cash Purchase Price is set forth on an attachment hereto
NUMBER OF OFFERED CASH PURCHASE
EXERCISING PARTNER(S) PARTNERSHIP UNITS PRICE
- --------------------- ----------------- -----------------------
WEEKS REALTY, L.P.
By: Weeks GP Holdings, Inc., General Partner
By:
-----------------------------------------
Title:
--------------------------------------
Date:
---------------------------------------
<PAGE>
Exhibit E
---------
Amount by which the value (determined as provided in the foregoing Second
Amendment) of the Collateral is to be increased upon the contribution of each
Development Property and each Northern Telecom Property:
<TABLE>
<CAPTION>
<S> <C>
Woodlake III $200,000
Regency - Sprint $200,000
2000 Perimeter Park West $200,000
Enterprise III $200,000
100 Perimeter Park $200,000
200 Perimeter Park $200,000
300 Perimeter Park $200,000
400 Perimeter Park $200,000
500 Perimeter Park $200,000
800 Perimeter Park $200,000
</TABLE>
