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Exhibit 10.29
The Crescent
Dallas, Texas
CONTRIBUTION AGREEMENT
THIS
CONTRIBUTION AGREEMENT (this "Agreement"), made to be effective as
of
November 10, 2004 (the "Effective Date"),
between CRESCENT REAL ESTATE FUNDING
I, L.P., a Delaware limited partnership,
having an office at 777 Main Street,
Suite 2100, Fort Worth, Texas 76102-5325
("Seller"); CRESCENT TC INVESTORS,
L.P., a Delaware limited partnership,
having an office c/o J.P. Morgan
Investment Management Inc., 522 Fifth
Avenue, New York, New York 10036
("Purchaser"); CRESCENT BT I INVESTOR,
L.P., a Delaware limited partnership,
having an office at 777 Main Street, Suite
2100, Fort Worth, Texas 76102-5325
("CBTIILP"); and CRESCENT BIG TEX I, L.P.,
a Delaware limited partnership,
having an office c/o J.P. Morgan Investment
Management Inc., 522 Fifth Avenue,
New York, New York 10036 ("Big Tex"); each
a "Party" and, collectively, the
"Parties." In addition, Crescent Real
Estate Equities Limited Partnership, a
Delaware limited partnership ("Crescent")
has executed this Agreement solely for
the purposes of Article 6, Article 7,
Article 13, Article 16 and Article 17
hereof.
WHEREAS,
Seller owns fee simple title in and to all of that certain
tract
or parcel of land situated in Dallas,
Dallas County, Texas, being more
particularly described on Exhibit A
attached hereto and made a part hereof for
all purposes (the "Land"), together with
all improvements, structures (including
the parking garage) and fixtures located on
the Land (collectively, the
"Improvements");
WHEREAS, subject
to the terms and conditions set forth herein, Seller
desires to convey, and CBTIILP desires to
acquire, the Property (as hereinafter
defined, which includes all of the Land and
the Improvements, and all other
rights and interests pertaining thereto as
more particularly described in
Section 2.1 hereinafter);
WHEREAS,
the limited partner of both Seller and CBTIILP is Crescent and
for tax purposes the general partner
interest of both Seller and CBTIILP is
owned by Crescent Real Estate Equities
Company, a Texas real estate investment
trust;
WHEREAS,
for federal income tax purposes such conveyance of the Property
from Seller to CBTIILP shall be treated as
a distribution of the Property to the
partners of Seller, followed by a
conveyance of the Property by such partners to
CBTIILP;
WHEREAS,
following such acquisition by CBTIILP, subject to the terms and
conditions set forth herein, CBTIILP
desires to contribute the Property and cash
to Big Tex in exchange for a 39.9% limited
partnership interest in Big Tex,
together with a 0.1% general partner
interest in Big Tex to be held by Crescent
BT I GP, L.P., a Delaware limited
partnership ("GP") wholly owned by CBTIILP;
WHEREAS,
following that contribution to Big Tex, subject to the terms
and
conditions set forth herein, Big Tex
desires to contribute the Property to
Purchaser in exchange for a 99.9%
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limited partnership interest in Purchaser,
together with a 0.1% general partner
interest in Purchaser to be held by
Crescent TCI GP LLC, a Delaware limited
liability company wholly owned by Big
Tex.
NOW,
THEREFORE, in consideration of the mutual promises and covenants
set
forth herein, and for other good and
valuable consideration, the receipt and
sufficiency of which are hereby
acknowledged, the Parties hereby agree to the
following:
ARTICLE 1.
CERTAIN DEFINITIONS.
For
purposes of this Agreement, the following terms shall have the
respective meanings set forth below:
"Actions"
mean any claims, actions, suits, demands, proceedings or
investigations, whether at law or in equity
or before any court, arbitrator,
arbitration panel or Governmental Body.
"Additional Rent" has the meaning ascribed to such term in Section
11.2 of
this Agreement.
"Affiliate" of a party means any Person that, directly or
indirectly,
controls, is controlled by or is under
common control with, such party. For
purposes of this Agreement the term
"control" means the possession, directly or
indirectly, of the power to decide,
affirmatively (by direction) or negatively
(by veto), the management and policies of a
Person, whether through ownership
and voting securities, by contract or
otherwise.
"Agreement" has the meaning ascribed to such term in the
Introductory
Paragraph.
"Ancillary
Agreement" means each Purchaser Ancillary Agreement and Seller
Ancillary Agreement.
"Base
Rents" has the meaning ascribed to such term in Section 11.2 of
this
Agreement.
"Adjoining
Land" means any land owned by Seller, or in which the Seller
otherwise has an interest, lying in the bed
of any street, road, avenue, open or
proposed, public or private, in front of or
adjoining the Land or any portion
thereof, and any award to be made in lieu
thereof and in and to any unpaid award
for damage to the Land or the Improvements
by reasons of change of grade of any
street occurring after the Effective
Date.
"CC&Rs" means that certain Declaration of Covenants, Conditions
and
Restrictions for The Crescent dated May 5,
1994, recorded at Volume 94087, Page
78, Deed Records Dallas County, Texas, as
amended from time to time.
"CC&Rs
Estoppel" means that certain Declaration Estoppel Certificate
related to the CC&Rs, the form of which
is attached hereto as Exhibit J.
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"Closing"
means the closing of the transactions contemplated hereby,
which
shall take place at the offices of the
Escrow Agent or through escrow pursuant
to an escrow agreement mutually agreeable
to the Parties on the Closing Date at
10:00 A.M., or at such other time or place
as the parties may agree upon in
writing.
"Closing
Date" means November 10, 2004. The Parties acknowledge and
agree
that the Closing Date and the Effective
Date are the same date; it is the
Parties' intention that the transactions
contemplated herein are to be
consummated on a "sign and close" basis on
such date. In this Agreement,
reference is generally made to such date as
the "Closing Date" in the context of
provisions that address the Closing.
"Code"
means the Internal Revenue Code of 1986, as amended and the
rules
and regulations promulgated thereunder.
"Commitment" has the meaning ascribed to such term in Section 4.1.1
of
this Agreement.
"Crescent"
has the meaning ascribed to such term in the Introductory
Paragraph of this Agreement.
"Damages"
mean all actual losses, liabilities, costs, damages, claims and
expenses (including reasonable attorneys'
fees and disbursements through
appeal).
"Default"
means (i) a breach of or default under any contract, agreement,
covenant, document or other instrument, or
(ii) the occurrence of an event which
with the passage of time or the giving of
notice, or both, would constitute a
breach of or default under any such
contract, agreement, covenant, document or
other instrument, or (iii) the occurrence
of an event that with or without the
passage of time or the giving of notice, or
both, would give rise to a right of
termination or acceleration under any such
contract, agreement, covenant,
document or other instrument.
"DeShazo
Letters" means, collectively, the DeShazo Parking Letter and
the
DeShazo Loading Space Letter.
"DeShazo
Loading Space Letter" means a certain letter dated November 3,
2004 from John DeShazo, addressed to
Purchaser, pursuant to which Mr. DeShazo
attests to (i) the loading space
requirements of the Property under the current
City of Dallas Zoning Code, and (ii) the
fact that the Property currently
complies with such requirements.
"DeShazo
Parking Letter" means a certain letter dated November 3, 2004
from John DeShazo, addressed to Purchaser,
pursuant to which Mr. DeShazo attests
to (i) the parking space requirements of
the Property under the current City of
Dallas Zoning Code, and (ii) the fact that
the Property currently complies with
such requirements.
"Environmental Laws" mean all federal, state, local and foreign
environmental, health and safety Laws
including, without limitation Laws
relating to emissions, discharge, releases
or threatened releases of pollutants,
contaminants, chemicals, or industrial,
toxic or hazardous substances into the
environment (including, without limitation,
air, surface water, ground water,
land surface or subsurface strata) or
otherwise relating to the manufacture,
processing,
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distribution, use, treatment, storage,
disposal, transport or handling of
pollutants, contaminants, chemicals, or
industrial, solid, toxic or hazardous
substances. As used in this Agreement, the
term "Hazardous Substances" includes,
without limitation, (i) all substances
which are designated pursuant to Section
311(b)(2)(A) of the Federal Water Pollution
Control Act ("FWPCA"), 33 U.S.C.
Section 1251 et seq.; (ii) any element,
compound, mixture, solution, or
substance which is designated pursuant to
Section 102 of the Comprehensive
Environmental Response, Compensation and
Liability Act ("CERCLA"), 42 U.S.C.
Section 9601 et seq.; (iii) any hazardous
waste having the characteristics which
are identified under or listed pursuant to
Section 3001 of the Resource
Conservation and Recovery Act ("RCRA"),
Section 6901 et seq.; (iv) any toxic
pollutant listed under Section 307(a) of
the FWPCA; (v) any hazardous air
pollutant which is listed under Section 112
of the Clean Air Act, 42 U.S.C.
Section 7401 et seq.; (vi) any imminently
hazardous chemical substance or
mixture with respect to which action has
been taken pursuant to Section 7 of the
Toxic Substance Control Act, 15 U.S.C.
Section 2601 et seq.; and (vii)
petroleum, petroleum products, petroleum
by-products, petroleum decomposition
by-products, and waste oil; (viii)
"hazardous materials" within the meaning of
the Hazardous Materials Transportation Act,
49 U.S.C. Section 1802 et seq.; (ix)
any hazardous substance or material
identified or regulated by or under any
applicable provisions of the laws of the
state in which any portion of the
Property is located; (x) asbestos or any
asbestos containing materials; (xi) any
radioactive material or substance; (xii)
all toxic wastes, hazardous wastes and
hazardous substances as defined by, used
in, controlled by or subject to all
implementing regulations adopted and
publications promulgated pursuant to the
foregoing statutes; and (xiii) any other
hazardous or toxic substance or
pollutant identified in or regulated under
any other applicable federal, state
or local Laws.
"Governmental Body" means any agency, instrumentality,
department,
commission, court, tribunal or board of any
government, whether foreign or
domestic and whether national, federal,
state, provincial or local.
"Ground
Lease" means that certain Ground Lease dated May 5, 1994, by
and
between RRCC Limited Partnership, a Texas
limited partnership ("RRCC"), as
landlord, and RRCC, as tenant, recorded at
Volume 94087, Page 143, Deed Records
Dallas County, Texas, as amended from time
to time.
"Ground
Lease Estoppel" means that certain Ground Lease Estoppel
Certificate related to the Ground Lease,
the form of which is attached hereto as
Exhibit K.
"Guarantees" means all guarantees, agreements and undertakings of
any
Guarantor in connection with the Tenant
Leases (individually, a "Guaranty").
"Guarantor" means any guarantor under any existing Guaranty of any
Tenant
Lease.
"Hazardous
Discharge" has the meaning ascribed to such term in Section
5.1.2(n) of this Agreement.
"Hotel
Site" as defined in the CC&Rs, and means the interests in the
Land
that are encumbered by the Ground
Lease.
"Houston
Center Contract" means that certain Purchase and Sale Agreement
of even date herewith between Crescent, as
the seller thereunder, and Crescent
HC Investors, L.P., an
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Affiliate of Purchaser, as the purchaser
thereunder, relating to the land and
improvements commonly known as Houston
Center in Houston, Harris County, Texas.
"Intangible Personal Property" shall mean all right, title and
interest of
Seller in and to all telephone numbers
listed after the name of the Property,
and all other items of intangible personal
property owned by Seller and utilized
principally in connection with the
operation of the Property (except for items
of intangible personal property that are
otherwise the subject of other defined
terms set forth in this Agreement).
"Korshak"
shall mean Stanley Korshak L.P., a Texas limited partnership.
"Korshak
Lease" shall mean that certain Retail Lease dated October 8,
2002, by and between Seller, as Landlord,
and Korshak, related to the Property,
as amended from time to time.
"Korshak
Participation Agreement" is defined in Section 28.9 of this
Agreement.
"Law" or
"Laws" mean laws, statutes, rules, regulations, codes, orders,
ordinances, judgments, injunctions, or
decrees.
"Lehman"
means Lehman Brothers Holdings, Inc.
"License
Agreements" means all agreements (written or oral) in the
nature
of licenses to which Seller is a party or
is bound affecting any portion of the
Property all which are set forth in
Schedule 5.1.2(d) annexed hereto and made a
part hereof.
"Lien"
means any security interest, lien, mortgage, claim, charge,
pledge,
restriction, equitable interest,
restrictive covenant or encumbrance of any
nature.
"Major
Lease" means any Tenant Lease with respect to which the Tenant
thereunder is a Major Tenant.
"Major
Tenant" means those Tenants identified as such on Schedule
5.1.2(d)
attached hereto.
"MetLife" means
Metropolitan Life Insurance Company, the lender under the
MetLife Note.
"MetLife
Note" means that certain Promissory Note in the original
principal amount of $25,000,000 executed by
RRCC (as defined hereinafter) in
favor of MetLife, secured by a Deed of
Trust, Security Agreement and Fixture
Filing granting a lien encumbering RRCC's
leasehold estate in the Hotel Site.
"MetLife
Estoppel" means that certain Lender Estoppel Certificate, the
form of which is attached hereto as Exhibit
L, related to the MetLife Note, and
to matters contained in that certain
estoppel certificate dated November 13,
2002, by and among MetLife, RRCC and
Seller.
"Ordinance
19890" means that certain City of Dallas Ordinance No. 19890,
recorded at Volume 98190, Page 1628, Deed
Records Dallas County Texas.
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"Ordinance
19890 Assignment" means written approval by the City of Dallas
Property Management Director of the
assignment of Seller's rights under
Ordinance 19890 to Purchaser and any
assignment documentation required by the
City of Dallas, Texas to effect such
assignment from Seller to Purchaser.
"Overage
Rent" has the meaning ascribed to such term in Section 11.1 of
this Agreement.
"Permits"
has the meaning ascribed to such term in Section 2.1.6 of this
Agreement.
"Person"
means any natural person, corporation, business trust, joint
venture, association, company, limited
liability entity, firm, partnership, or
other entity or Governmental Body.
"Post Oak
Contract" means that certain Purchase and Sale Agreement of
even
date herewith between Crescent Real Estate
Funding X, L.P., a Delaware limited
partnership, as the seller thereunder, and
Crescent POC Investors, L.P., an
Affiliate of Purchaser, as the purchaser
thereunder, relating to the land and
improvements commonly known as Post Oak
Central in Houston, Harris County,
Texas.
"Project
Name License" means that certain License Agreement in the form
attached hereto as Exhibit N, between
Crescent and Purchaser, granting to
Purchaser the right to use the name "The
Crescent" with respect to the Project.
"Property"
has the meaning given to it in the recitals above.
"Purchaser
Ancillary Agreement" means each agreement or other instrument
executed or to be executed in connection
with this Agreement by Purchaser or an
Affiliate of Purchaser, including the
Houston Center Contract, the Post Oak
Contract and all Closing documentation
executed by Purchaser or an Affiliate of
Purchaser in connection therewith.
"Reeves
Letter" means a certain letter dated November 3, 2004 from
Robert
Reeves, addressed to Purchaser, pursuant to
which Mr. Reeves attests to the fact
that the Land and the Improvements are in
compliance with all applicable Federal
Aviation Administration ("FAA") height
regulations and limitations.
"Rents"
has the meaning ascribed to such term in Section 11.1 of this
Agreement.
"Reports"
means the environmental reports and other written materials
listed in Exhibit H attached hereto and
made a part hereof.
"Security
Deposits" means all security deposits and other deposits (in
the
form of cash, letters of credit or
otherwise) required to be deposited with
Seller pursuant to the Tenant Leases.
"Seller
Ancillary Agreement" means each agreement or other instrument
executed or to be executed in connection
with this Agreement by Seller or an
Affiliate of Seller, including the Houston
Center Contract, the Post Oak
Contract and all Closing documentation
executed by Seller or an Affiliate of
Seller in connection therewith.
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"SPF"
means JPMorgan Chase Bank, as Trustee under Amended and
Restated
Declaration of Trust, dated November 13,
2001, as amended, for its Commingled
Pension Trust Fund (Strategic
Property).
"Subleases" means all leases executed by the Tenants or their
predecessors-in-interest to a third party
for all or a portion of the space
demised under such Tenants' Lease, all of
which are set forth in Schedule
5.1.2(d) attached hereto and made a part
hereof.
"Tenants"
(or singularly, a "Tenant") means the tenants under the Tenant
Leases.
"Tenant
Leases" means all agreements (written or oral) in the nature of
space leases, lettings, concessions or
occupancy agreements, and all amendments,
modifications, supplements, additions,
extensions, renewals and side letters
thereof or thereto, affecting the Land or
the Improvements.
"Title
Estoppels" means, collectively, the CC&Rs Estoppel, the
MetLife
Estoppel and the Ground Lease Estoppel.
"UCC
Releases" means release of each of the liens found per the UCC
Searches, as defined in Section 4.1.3
hereinafter, as set forth in Exhibit M.
ARTICLE 2.
TRANSFER OF THE PROPERTY.
Section
2.1. Property. For the consideration and upon and subject to
the
terms, provisions and conditions of this
Agreement, (a) Seller agrees to convey
to CBTIILP, (b) CBTIILP agrees to
contribute to Big Tex, and (c) Big Tex agrees
to contribute to Purchaser, all of the
respective transferors' right, title and
interest in and to all of the following
described property (collectively, the
"Property") set forth hereinafter. For the
purposes hereof, the Parties
acknowledge and agree that references to
"Seller's" rights, titles and interests
in and to the Property is intended in each
instance to refer also to the rights,
titles and interests therein received and
transferred hereunder by CBTIILP and
Big Tex.
2.1.1 Seller's fee simple title in and to all of the Property
(and,
if applicable, any Adjoining Land),
including all rights, titles and interests
of Seller appurtenant to the Land and
Improvements, including, without
limitation, (i) all minerals, oil, gas and
other hydrocarbon substances thereon
or thereunder, (ii) all easements,
privileges and hereditaments, whether or not
of record, (iii) all gaps, gores, adjacent
strips, adjacent roads, streets,
highways, alleys and rights-of-way (both
public or private, open or proposed),
(iv) any awards for damage to the Property
by reason of a change of grade of any
road, street, highway, alley, or
right-of-way, (v) any condemnation awards made
or to be made in lieu thereof, and (vi) all
access, air, water, riparian,
development, utility (including sanitary
and storm sewer capacity or
reservations or rights under utility
agreements) and solar rights and all income
therefrom;
2.1.2 All fixtures, furnishings, furniture, equipment,
machinery,
inventory, appliances and other personal
property owned by Seller, located at or
used in connection with the Land and
Improvements, including, without
limitation, (1) all mechanical systems,
fixtures and equipment comprising a part
of or attached to or located upon the Land
and Improvements,
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(2) all maintenance equipment and tools
owned by Seller and used in connection
with the Land and Improvements, (3) all
site plans, surveys, plans and
specifications, marketing materials and
floor plans in Seller's possession which
relate solely to the Improvements and no
other premises, (4) all pylons and
other signs, and (5) all other personal
property of every kind and character
owned by Seller and located in or on or
used in connection with the Land and
Improvements or the operations thereon,
(collectively, the "Personalty"), which
items are listed on Schedule 5.1.2(aa)
attached hereto. Notwithstanding anything
to the contrary contained herein, it is
expressly agreed by the Parties that any
fixtures, furniture, furnishings, equipment
or other personal property owned or
leased (from a party other than Seller) by
any tenant, managing agent, leasing
agent, contractor, or employee, shall not
be included in the Property to be sold
to Purchaser hereunder;
2.1.3 The Tenant Leases and Security Deposits, the License
Agreements and the Guaranties,
2.1.4 All of Seller's rights, titles and interests as lessee
under
any leases;
2.1.5 All service, management and maintenance contracts and
other
contracts, reciprocal easement agreements,
development agreements, concession
agreements and operating agreements all as
listed on Schedule 5.1.2(q) relating
to the ownership and operation of the
Property (collectively, the "Operating
Agreements"), and warranties, guaranties
and bonds in effect at Closing and
listed on Schedule 5.1.2(v) attached hereto
and by this reference made a part
hereof (the "Warranties") relating to the
Land, the Improvements or the
Personalty, to the extent the same are
assignable;
2.1.6 All permits, licenses, certificates of occupancy and
governmental approvals, if any, which
relate to the Land, Improvements,
Personalty, Operating Agreements or Tenant
Leases (the "Permits");
2.1.7 The Intellectual Property (hereinafter defined) used solely
in
connection with the operation of the
Property; excluding any Intellectual
Property to which Seller is restricted from
granting such a license or for which
consent is required and not obtained
(provided, that Seller agrees to use
commercially reasonable efforts to obtain
any such required consent). For the
purposes hereof, "Intellectual Property"
means any of the following which are
used by Seller in connection with the
Property: (i) trademarks, service marks,
trade dress, logo name, trade names, domain
name, registrations, designations
but excluding any Crescent or
Crescent-derivative trademark, service mark, trade
dress or logo except to the extent
otherwise expressly set forth in the Project
Name License, (ii) copyrights, (iii) trade
secrets and confidential business
information (including ideas, research and
development, know-how, formulas,
compositions, manufacturing and production
processes and techniques, methods,
schematics, technology, technical data,
designs, drawings, flowcharts, block
diagrams, specifications, customer and
supplier lists, pricing and cost
information and business and marketing
plans and proposals), (iv) computer
software (including data and related
documentation), (v) patents, and (vi)
licenses, sublicenses, agreements, or
permissions related to any of the
foregoing;
2.1.8 The Intangible Personal Property; and
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2.1.9 To the extent transferable, all other rights owned by
Seller
and necessary to or used exclusively in
connection with the ownership,
maintenance or operation of the items set
forth in subsections 2.1.1 through
2.1.8 above.
Section 2.2. The Parties
acknowledge and agree that the value of the
Personalty is de minimis and that no part
of the Purchase Price (hereinafter
defined) is allocable thereto. Although it
is not anticipated that any sales tax
shall be due and payable, Purchaser agrees
that Purchaser shall pay to the
applicable Governmental Body any and all
sales and/or compensating use taxes
imposed upon or due solely by reason of the
transactions contemplated hereunder
under any applicable Law. Purchaser shall
file all necessary tax returns with
respect to all such taxes and, to the
extent required by applicable Law, Seller
will join in the execution of any such tax
returns. The provisions of this
Section 2.2 shall survive the Closing.
ARTICLE 3.
PAYMENT OF PURCHASE PRICE.
Section
3.1. CBTIILP will contribute the Property and cash to Big Tex
in
exchange for a 39.9% limited partnership
interest in Big Tex and a 0.1% general
partner interest to be held by GP. The
Parties agree that the fair market value
of the Property is $324,000,000 and that
the Property is being contributed to
Big Tex subject to debt of
$214,770,000.
ARTICLE 4.
TITLE; DUE DILIGENCE REVIEW
Section
4.1. The Parties acknowledge and agree that prior to the
Effective
Date, Purchaser has received, and has had
an opportunity to review, the
following:
4.1.1 (i) from Fidelity National Title Insurance Company,
Attention:
Pat Noska, 717 N. Harwood Street, Suite
800, Dallas, Texas 75201, Telephone:
(214) 220-1829, Fax: (214) 969-5348 (the
"Escrow Agent"), as authorized agent
for Fidelity National Title Insurance
Company ("Fidelity"), G.F. No. 04-01-5204
dated effective September 26, 2004, issued
on November 1, 2004 (Revision #10);
(ii) from Stewart Title Guaranty Company,
Attention: Jim Putnam, 1980 Post Oak
Boulevard, Suite 110, Houston, Texas 77056,
Telephone: (713) 625-8700, Fax:
(713) 629-2255, as authorized agent for
Stewart Title Guaranty Company
("Stewart"), G.F. No. 04600130; (iii) from
Chicago Title Insurance Company,
Attention: Kay Starkey, 2001 Bryan Street,
Suite 1700, Dallas, Texas 75201,
Telephone: (214) 965-1686, Fax: (214)
965-1622, as authorized agent for Chicago
Title Insurance Company ("Chicago"), G.F.
No. 653195; and (iv) from Republic
Title of Texas, Inc., Attention: C. Richard
White, 2626 Howell Street, 10th
Floor, Dallas, Texas 75204, Telephone:
(214) 855-8868, Fax: (214) 855-8848, as
authorized agent for First American Title
Insurance Company ("First American"),
G.F. No. 04R16333 SJ3 (the foregoing,
collectively, the "Title Company") four
(4) title insurance commitments
(collectively, the "Commitment") pertaining to
the Land, and binding Fidelity to issue to
Purchaser at Closing on a
co-insurance basis an Owner's Policy of
Title Insurance (the "Fidelity Owner
Title Policy") in the amount of
$162,000,000 (the "Fidelity Owner Title Policy
Amount"); binding Stewart to issue to
Purchaser at Closing on a co-insurance
basis an Owner's Policy of Title Insurance
(the "Stewart Owner Title Policy") in
the amount of $64,800,000 (the "Stewart
Owner Title Policy Amount"); binding
First American to issue to Purchaser at
Closing
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on a co-insurance basis an Owner's Policy
of Title Insurance (the "First
American Owner Title Policy") in the amount
of $64,800,000 (the "First American
Owner Title Policy Amount"); and binding
Chicago to issue to Purchaser at
Closing on a co-insurance basis an Owner's
Policy of Title Insurance (the
"Chicago Owner Title Policy" and, together
with the Fidelity Owner Title Policy,
the Stewart Owner Title Policy and the
First American Owner Title Policy,
collectively, the "Owner Title Policy") in
the amount of $21,477,000 (the
"Chicago Owner Title Policy Amount" and,
together with the Fidelity Owner Title
Policy Amount, the Stewart Owner Title
Policy Amount and the First American
Owner Title Policy Amount, collectively,
the "Owner Title Policy Amount");
together with copies of instruments or
documents (the "Exception Documents")
creating or evidencing conditions or
exceptions to title affecting the portion
of the Land that is the subject thereof, as
described in the Commitment;
4.1.2 A copy of the most current on the ground survey for the
Land
in Seller's possession, dated September 30,
2004 (last revised November 4,
2004), Project No. 20100-173A, prepared by
G. Richard Busby, R.P.L.S. No. 4111,
a surveyor licensed by the State of Texas
(the "Survey");
4.1.3 Searches of the Uniform Commercial Code Records of Dallas
County, Texas, as well as a search of the
Secretary of State of the State of
Texas, with respect to Seller (and the
Secretary of State of the State of
Delaware with respect to the formation of
Seller) under the name of Seller (the
"UCC Searches") dated within 60 days of the
Effective Date hereof;
4.1.4 Litigation searches of Seller from county courts in
Dallas
County, Texas, the state district courts of
Dallas County, Texas and federal
courts in the Northern District of Texas,
Dallas Division (the "Litigation
Searches"); and
4.1.5 Searches of the Real Property Records of Dallas County,
Texas
under the name of Seller with respect to
federal and state tax liens and
judgment liens (the "Lien Searches").
The costs
associated with the Survey, the UCC Searches, the Litigation
Searches and the Lien Searches shall be
paid by Seller. Subject to the terms and
conditions set forth in this Agreement,
Purchaser hereby approves the Commitment
(including the Exception Documents
pertaining thereto), the Survey, the UCC
Searches, the Litigation Searches and the
Lien Searches.
Section
4.2. At Closing, the Title Company shall issue to Purchaser the
Owner Title Policy for the Land as
specified in the Commitment, with such
endorsements as the Parties may direct,
dated no earlier than the date of the
filing of the Deed described in Section
9.1.1 hereof, insuring Purchaser's title
to the Land in the amount of the Owner
Title Policy Amount, subject to the
Permitted Exceptions (hereinafter defined).
For the purposes hereof, the term
"Permitted Exceptions" shall mean and refer
to (i) the title encumbrances,
exceptions or other matters set forth in
Exhibit G attached hereto, which are
reflected in the Commitment (but excluding
those matters which are expressly
identified below as Non-Permitted
Exceptions to Title); (ii) the rights of the
Tenants under Tenant Leases listed in
Exhibit G as Tenants only without any
option or right of first offer or refusal
to purchase; and (iii) taxes and
assessments for the year in which Closing
occurs and subsequent years.
Notwithstanding anything to the contrary
herein, Seller
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agrees that there shall be no Liens
affecting the Land or Improvements at the
time of Closing, and Seller shall satisfy
any and all such Liens prior to or
concurrently with the Closing (the
"Non-Permitted Exceptions to Title"). With
respect to the costs associated with the
Commitment, the Owner Title Policy to
be issued in connection therewith, and any
mortgagee title insurance policy (a
"Mortgagee Policy") relating to a New Loan
(hereinafter defined), including in
each instance, without limitation, the cost
of reinsurance and endorsements, the
Parties agree that the payment of such
costs, together with the title insurance
costs under the Houston Center Contract and
the Post Oak Contract shall be
allocated among Purchaser and its
Affiliates and Seller and its Affiliates as
follows: Seller, 41.9%; Purchaser,
58.1%.
Section
4.3.
4.3.1 The parties acknowledge and agree that, during the period
between July 22, 2004 and the Effective
Date (the "Due Diligence Period"),
Purchaser had an opportunity to perform its
due diligence review of the
Property. Purchaser acknowledges that
certain written information has been made
available by Seller to Purchaser in the
disclosure schedules attached hereto or
posted on the "Client Connect" website
maintained by Haynes and Boone, LLP under
the heading "The Crescent - Due Diligence,"
on behalf of Seller and its
Affiliates, at least three (3) business
days prior to the Closing Date
(collectively, the "Due Diligence
Information"). Subject to the terms and
conditions set forth in this Agreement,
Purchaser has determined that the
Property is satisfactory and feasible for
its intended use.
4.3.2 The Parties acknowledge that the Due Diligence
Information
which Seller has made available to
Purchaser includes certain documents and
other information pertaining to the
Property prepared by third parties other
than Seller or an Affiliate of Seller (the
"Third Party Property Information").
Except as otherwise expressly provided
herein, Seller expressly disclaims any
and all liability for representations or
warranties, express or implied,
statements of fact and other matters
contained in the Third Party Property
Information, or in any other written or
oral communications transmitted or made
available to Purchaser, which has been
prepared by third parties other than
Seller or an Affiliate of Seller. With
respect to the Property, Purchaser shall
rely solely upon (a) Purchaser's due
diligence review of the Property, and (b)
the express warranties and representations
of Seller set forth in this Agreement
pertaining to the Property, including,
without limitation, the Property's
physical, environmental or economic
condition, compliance or lack of compliance
with any Law or Permit or any other
attribute or matter relating thereto.
ARTICLE 5.
REPRESENTATIONS AND WARRANTIES.
Section
5.1. As of the Effective Date hereof, Seller represents and
warrants to Purchaser the following:
5.1.1 Seller Representations.
(a) Seller is a limited partnership duly organized and validly
existing
and in good standing under the laws of the State of Delaware,
and
is
qualified to do business in the State of Texas. Seller has the
full
power and
authority to own, lease and operate its
11
<PAGE>
assets and
properties and to conduct its business as now conducted.
Neither
Seller, nor any entity controlling, or controlled by, Seller
owns
a five percent (5%) or
greater interest (within the meaning of Prohibited
Transaction Class Exemption 84-14) in JP Morgan Chase Bank.
(b) This Agreement constitutes the legal, valid and binding
obligation
of Seller, enforceable against Seller in accordance with its
terms.
Seller has taken all necessary action to authorize and approve
the
execution
and delivery of this Agreement and the Seller Ancillary
Agreements
and its performance hereof and thereof.
(c)
The execution and delivery of this Agreement and the Seller
Ancillary
Agreements and the performance by Seller of its obligations
hereunder
and thereunder do not and will not conflict with or violate any
current
Laws of any Governmental Body with jurisdiction over Seller or
the
Property,
including, without limitation, the United States of America,
the
State of
Delaware, the State of Texas, or any political subdivision of
any
of the
foregoing, or any decision or ruling of any arbitrator to which
Seller is
a party or by which Seller or the Property is bound or
affected.
(d) Annexed hereto as Schedule 5.1.1(d) and made a part hereof
are
the
financial statements prepared by Seller relating to the Property
for
the three
years ended December 31, 2001, 2002 and 2003 (collectively, the
"Financial
Statements"). The Financial Statements in each case are true
and
complete with respect to all material items contained therein
and
fairly
present in all material respects the financial position and
results
of
operations of Seller with respect to the Property as at, or for
the
periods
ended on, such dates. Also annexed as part of such Schedule are
certain
operating statements prepared by Seller relating to the
Property
covering
periods subsequent to December 31, 2003, as shown therein. Such
statements
and budgets were prepared in the ordinary course of managing
the
Property.
5.1.2 Property Representations.
(a) To Seller's knowledge, no Governmental Body plans to change
the
highway or
road system in the vicinity of the Land in a manner which would
adversely
affect the Land and/or the business operations conducted
thereon
or would
restrict or change access from any such highway or road to the
Land.
(b) There are no pending or, to Seller's knowledge, threatened
condemnation or eminent domain proceedings relating to or affecting
the
Land
and/or the Improvements.
(c) No Person has any (i) conditional or unconditional right
and/or
option to
purchase the Property or any portion thereof, and/or (ii) right
of first
refusal or offer to purchase the Property or any portion
thereof.
(d) Schedule 5.1.2(d) attached hereto, which includes a rent
roll
and other
information pertaining to the Tenant Leases, is true, correct
and
complete, and lists all Tenant Leases with respect to the Land or
any
portion thereof or
interest therein that Seller leases, subleases or
licenses
as the ground lessor, lessor, sublessor or licensor.
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<PAGE>
Seller has
made available to Purchaser true and materially complete and
correct
copies of the Tenant Leases and currently outstanding letters
of
intent
relating to occupancy of space within the Property. Except as
otherwise
shown in Schedule 5.1.2(d), no Person other than Seller has the
right to
possess or occupy the Land (or any portion thereof). All of the
Tenant
Leases are in full force and effect and have not been modified
except as
set forth in Schedule 5.1.2(d). To Seller's knowledge, there
are
no parties
in possession of the Land (or any portion thereof) except the
Tenants
and any subtenants under subleases that are disclosed in
Schedule
5.1.2(d);
except as set forth in Schedule 5.1.2(d), there are no
unsatisfied "Take-Over" space obligations or "Take-Back" space
obligations
(for the
purposes hereof, "Take-Over" space obligations means rent
obligations of the Tenant in other buildings assumed by the
landlord and
"Take-Back" space obligations means obligations imposed upon the
landlord
to sublet
or otherwise be responsible for the obligations of a Tenant
under a
Tenant Lease). Except as set forth in Schedule 5.1.2(d), there
are
no
disputes with Tenants as to the amount of their rent or other
charges
(including, without limitation, charges for common area
maintenance) under
any Tenant
Lease; except as set forth in the Tenant Leases, no Tenant has
any option
to cancel its Tenant Lease; except as set forth in Schedule
5.1.2(d),
there is no Default beyond applicable notice and cure periods
by
the
landlord under any Tenant Leases. Seller has not received from
any
Tenant any
written notice claiming any Default by the landlord under its
Tenant
Lease; except as set forth in Schedule 5.1.2(d), Seller has not
delivered
to any Tenant any written notice claiming a Default by Tenant
under its
Tenant Lease which Default has not been cured; except as set
forth in
Schedule 5.1.2(d), to Seller's knowledge, there are no
circumstances which, after notice and the expiration of any
applicable
grace
period, would constitute a Default by either landlord or any
Tenant
under any
of the Tenant Leases; except as set forth in Schedule 5.1.2(d),
Seller has
not received written notice from any Tenant of any defense to,
or offsets
or claims against rental payable or obligations under any
Tenant
Lease; and to Seller's knowledge, no Tenant has asserted, or
has
any
defense to, offsets or claims against rental payable or
obligations
under any
Tenant Lease.
Except for
any Subleases specified in Schedule 5.1.2(d), to Seller's
knowledge, (i) Seller has not consented to
any Subleases, (ii) there are no
Subleases encumbering or affecting the Land
or Improvements (or any portion
thereof), and (iii) true, correct and
complete copies of any such Subleases have
been delivered to Purchaser and/or its
consultants, accountants, auditors,
attorneys, agents and/or other
representatives ("Purchaser's Representatives").
Except for
the License Agreements specified in Schedule 5.1.2(d), there
are no License Agreements encumbering or
affecting the Land or Improvements (or
any portion thereof). True, correct and
complete copies of any such License
Agreements have been delivered to Purchaser
and/or Purchaser's Representatives.
All of such License Agreements are in full
force and effect and have not been
modified except as set forth in Schedule
5.1.2(d). Except as set forth in
Schedule 5.1.2(d), there are no disputes
with any licensee as to the amount of
its rent or other charges (including,
without limitation, charges for common
area maintenance) under any License
Agreement; except as set forth in such
License Agreements, no licensee has any
option to cancel its License Agreement;
except as set forth in Schedule 5.1.2(d),
there is no Default beyond applicable
notice and cure periods by any licensee
under such License Agreements. Seller
has not received from any licensee any
written notice claiming any Default by
Seller as licensor
13
<PAGE>
under its License Agreement; except as set
forth in Schedule 5.1.2(d), Seller
has not delivered to any licensee written
notice claiming a Default by such
licensee under its License Agreement which
Default has not been cured; except as
set forth in Schedule 5.1.2(d), to Seller's
knowledge there are no circumstances
which, after notice and the expiration of
any applicable grace period, would
constitute a Default by either any licensee
or Seller, as licensor under any of
the License Agreements; except as set forth
in Schedule 5.1.2(d), Seller has not
received written notice from any licensee
of any defense to, or offsets or
claims against rental payable or
obligations under any License Agreement; and to
Seller's knowledge, no licensee has
asserted, or has any defense to, offsets or
claims against rental payable or
obligations under any License Agreement.
Schedule
5.1.2(d) specifies any Guarantees relating to the Tenant
Leases.
All of such Guarantees are in full force
and effect and have not been modified
except as set forth in Schedule 5.1.2(d).
Except as set forth in Schedule
5.1.2(d), no Guarantor of any Tenant Lease
has been released or discharged,
voluntarily (or to Seller's knowledge,
involuntarily, or by operation of law)
from any obligation related to such Tenant
Lease and covered by its Guaranty.
With
respect to the rent roll that is a part of Schedule 5.1.2(d)
attached
hereto: (i) such rent roll reflects all
Tenant Leases dated as of November 5,
2004, prepared by or for Seller; the
information in the rent roll was used to
invoice Tenants for their monthly payments
for November, 2004; (ii) the rent
roll sets forth all of the Security
Deposits being held by Seller and required
to be delivered by the Tenants under their
Tenant Leases; there are no other
Security Deposits; and all Security
Deposits are held by or on behalf of Seller;
and (iii) the information shown on the rent
roll is true, correct and complete
in all material respects.
(e) Schedule 5.1.2(e) specifies all unpaid leasing costs and
expenses
arising out of Tenant Leases entered into prior to the
Effective
Date
(including, without limitation, all tenant improvement costs,
all
outstanding tenant improvement allowances and all outstanding
leasing
commissions). Except for those unpaid leasing costs and
expenses
(including, without limitation, tenant improvement costs,
outstanding
tenant
improvement allowances and outstanding leasing commissions)
listed
in
Schedule 5.1.2(e), there are no other such costs or expenses due
now,
or that
will hereafter become due or owing with respect to the Land or
Improvements, other than in connection with leases that may be
entered
into by
Purchaser after the Effective Date. Except as otherwise shown
in
Schedule
5.1.2(e), there are no unpaid leasing costs or expenses
(including, without limitation, tenant improvement costs,
outstanding
tenant
improvement allowances or outstanding leasing commissions) due
or
payable to
Seller or any of its Affiliates in connection with the Tenant
Leases
entered into as of the Effective Date.
(f) Except as set forth in Schedule 5.1.2(f), all tenant
improvements required under the Tenant Leases to be completed by
the
Effective
Date hereof by the landlord thereunder have been completed and
all tenant
allowances and other tenant inducement costs required under the
Tenant
Leases to be paid prior to the Effective Date have been paid in
full.
(g) Except as set forth in Schedule 5.1.2(g), to Seller's
knowledge
after due
and diligent inquiry, the Land and Improvements and the current
use,
occupation and
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<PAGE>
condition
thereof are in compliance with and do not violate any
applicable
deed
restrictions or other covenants, restrictions or agreements
(including, without limitation, any of the Permitted Exceptions) in
any
material
respect. Except as set forth in Schedule 5.1.2(g), to Seller's
knowledge,
the Land and Improvements and the current use, occupation and
condition
thereof are in compliance with and do not violate any
applicable
site plan
approvals, zoning or subdivision regulations or urban
redevelopment plans applicable to the Land and Improvements in
any
material
manner. Except as set forth in Schedule 5.1.2(g), neither
Seller
nor, to
Seller's knowledge, any Affiliate of Seller, has received any
written
notice of noncompliance with or violation of any applicable
deed
restriction or other covenants, restrictions, or agreements
(including,
without
limitation, any of the Permitted Exceptions), site plan,
approvals,
zoning or subdivision regulations or urban redevelopment plans
applicable
to the Land and Improvements. Seller is not in material Default
under any
Permitted Exception. Except as set forth in Schedule 5.1.2(g),
to
Seller's knowledge, Seller is in compliance with the covenants,
conditions, obligations, restrictions and requirements set forth in
the
Permitted
Exceptions. Except as set forth in Schedule 5.1.2(g), to
Seller's
knowledge, all work, development, construction and improvements
performed
or required pursuant thereto, whether by Seller or any
predecessor in interest, have been completed and paid for in
conformity
therewith.
Except as set forth in Schedule 5.1.2(g), all current
assessments, dues, charges and other payments required under any of
the
Permitted
Exceptions have been paid in full and Seller is not in arrears
with
respect to any such payments.
(h) Except as set forth in the current tax bills, copies of
which
are
annexed hereto and made a part hereof as Schedule 5.1.2(h),
which
copies are
true and complete copies of such tax bills, there are no
special
assessments or charges which have been levied against, and
remain
an
obligation of, the Land and/or the Improvements. There are no
pending
or, to
Seller's knowledge, threatened, special assessments affecting
the
Land
and/or the Improvements or any contemplated improvements
affecting
the Land and/or the Improvements
that may result in any such special
assessments.
(i) Except for the Leasing and Management Agreement (herein so
called) to
be executed on the Closing Date, there is no contract or
agreement
with any third party for the management of the Property or any
portion
thereof, which will be binding on the Land and Improvements or
on
Seller as
of the Closing Date.
(j) Except as set forth in the Reports and in Schedule
5.1.2(j),
Seller and
the Property have complied in all material respects with all
Environmental Laws. Seller has obtained all material Permits which
are
required
with respect to the operation of the Land and Improvements
under
any
Environmental Laws.
(k) Seller and the Land and Improvements are in possession of
(and
in
compliance in all material respects with the requirements of),
all
Permits
required by any Environmental Laws, and are also in compliance
in
all
material respects with all other limitations, restrictions,
conditions, standards, prohibitions, requirements, obligations,
schedules
and
timetables contained in any Environmental Laws or contained in
any
plan,
order, decree, judgment, injunction, notice or demand letter
issued,
entered,
promulgated or approved thereunder applicable to Seller or the
Land or
Improvements. Seller has
15
<PAGE>
delivered
or made readily available to Purchaser or the Purchaser
Representatives true and complete copies of all final
environmental
studies
prepared by outside consultants relating to the Land and
Improvements that were prepared for or requested by Seller or
Crescent.
(l) Except as set forth in the Reports, there is no pending, or,
to
Seller's
knowledge, threatened Action, demand, claim, hearing, notice of
violation,
notice or demand letter that affects or applies to Seller or
the Land
or Improvements implicating Environmental Laws or any order,
decree,
judgment, injunction, notice or demand letter issued, entered,
promulgated or approved thereunder.
(m) Except as set forth in the Reports and in Schedule
5.1.2(m),
there are
no past or present events, conditions, circumstances,
activities, practices, incidents, actions or plans known to Seller
which
may
reasonably be expected to interfere with or prevent the compliance
or
continued
compliance by Seller with any Environmental Laws or with any
regulation, code, plan, order, decree, judgment, injunction, notice
or
demand
letter issued, entered, promulgated or approved thereunder, or
which is
reasonably likely to give rise to any common law or legal
liability,
or otherwise form the basis of any Action, hearing, notice of
violation
or study, based on or related to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or
handling, or
the emission, discharge, release
or threatened release into the
environment, by Seller or the Land or Improvements of any
pollutant,
contaminant, chemical, or industrial, toxic or Hazardous
Substances.
(n) Except as set forth in the Reports and in Schedule 5.1.2(n),
to
Seller's
knowledge there has been no material emission, spill, release
or
discharge
from the Land or Improvements or by Seller at any other
location
or
disposal site, into or upon (i) the air, (ii) soils or
improvements,
(iii)
surface water or ground water, or (iv) the sewer, septic system
or
waste
treatment, storage or disposal system servicing the Land and/or
the
Improvements of any toxic or Hazardous Substances regulated by
the
Environmental
Laws and used, stored, generated, treated or disposed at or
from the
Land and/or the Improvements (any of which events is
hereinafter
referred
to as "Hazardous Discharge"). To Seller's knowledge, the Land
and
Improvements are free of material amounts of all Hazardous
Substances
except for
paints, cleaning materials, fertilizer, pesticides, fuels and
lubricants
or similar materials in amounts customarily used by prudent
owners and
tenants in the construction, ownership, management and
maintenance of their properties, which are, to Seller's knowledge,
being
used,
stored, handled, transported, generated and disposed of in
compliance
with applicable Environmental Laws.
(o) Except as set forth in the Reports and in Schedule
5.1.2(o),
Seller has
not received any written notice of and has no knowledge of any
complaints, orders, directives, claims, citations or notices with
respect
to (i) air
emissions, (ii) spills, releases or discharges to soils or any
improvements located thereon, surface water, ground water or the
sewer,
septic
system or waste treatment, storage or disposal systems
servicing
the Land
and/or the Improvements, (iii) noise emissions, (iv) solid or
liquid
waste disposal, (v) the use, generation, storage, transportation
or
disposal
of toxic or Hazardous
16
<PAGE>
Substances
or (vi) other environmental, health or safety matters affecting
Seller or
the Property.
(p) Neither the Land nor any portion thereof is now or has ever
been
a
"Super-Fund Site". Except as set forth in the Reports and in
Schedule
5.1.2(p),
to Seller's knowledge there are no underground storage tanks
located on
the Land.
(q) There are no Operating Agreements affecting the Property,
oral
or
written, other than those listed in Schedule 5.1.2(q) attached
hereto.
Except as
set forth in Schedule 5.1.2(q), each of the Operating
Agreements
is in full
force and effect. Seller has performed all material obligations
required
to be performed by it, and is not in material Default, under
any
Operating
Agreement to which it is a party, by assumption or otherwise.
To
Seller's
knowledge, no other party is in material Default under any such
Operating
Agreement. Seller has delivered to Purchaser or to Purchaser's
Representatives true, correct and complete copies of the
Operating
Agreements. Except as
set forth in Schedule 5.1.2(q), Seller is not a
party to
any material lease, contract, agreement or other obligation
other
than the
Tenant Leases and the Operating Agreements. Except as set forth
in
Schedule 5.1.2(q), none of the Operating Agreements (other than
the
Leasing
and Management Agreement) are between Seller and any Affiliate
of
Seller.
(r) (i) Except as set forth in Schedule 5.1.2(r), Seller has
not
received
any written notice of
