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CONTRIBUTION AGREEMENT between DUKE REALTY LIMITED PARTNERSHIP ET AL. and LAFAYETTE REAL ESTATE LLC and BELCREST REALTY CORPORATION as of December 6, 2006

Contribution Agreement

CONTRIBUTION AGREEMENT between DUKE REALTY LIMITED PARTNERSHIP ET AL. and LAFAYETTE REAL ESTATE LLC and BELCREST REALTY CORPORATION as of December 6, 2006 You are currently viewing:
This Contribution Agreement involves

Belcrest Realty Corporation | Duke Realty Corporation | Duke Realty Limited Partnership | Lafayette Real Estate LLC | Mark Center 1801/1901, LLC | MARK CENTER 2001, LLC | MARK CENTER BUILDING, LLC | MARK CENTER BUILDINGS II, LLC | Mark Center Buildings, LLC | WTM Master Building, LLC

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Title: CONTRIBUTION AGREEMENT between DUKE REALTY LIMITED PARTNERSHIP ET AL. and LAFAYETTE REAL ESTATE LLC and BELCREST REALTY CORPORATION as of December 6, 2006
Governing Law: Delaware     Date: 3/1/2007
Industry: REOPER     Law Firm: Goulston Storrs;Alston Bird     Sector: SERVIC

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Exhibit 10.31

CONTRIBUTION AGREEMENT

between

DUKE REALTY LIMITED PARTNERSHIP ET AL.

and

LAFAYETTE REAL ESTATE LLC

and

BELCREST REALTY CORPORATION

as of December 6, 2006

 

 

 

 




 

Table of Contents

ARTICLE 1. 

Background

1

 

 

 

ARTICLE 2.

Agreement to Contribute; Description of Property; Defined Terms

2

 

 

 

ARTICLE 3.

Contribution Subject to Leases

4

 

 

 

ARTICLE 4.

Reserved

4

 

 

 

ARTICLE 5. 

Form of Contribution

4

 

 

 

ARTICLE 6.

Closing

5

 

 

 

ARTICLE 7. 

Reserved

9

 

 

 

ARTICLE 8. 

Conditions to Closing

9

 

 

 

ARTICLE 9. 

Default

11

 

 

 

ARTICLE 10. 

Entire Agreement Herein

12

 

 

 

ARTICLE 11.

Damage or Destruction; Condemnation

13

 

 

 

ARTICLE 12. 

Representations and Warranties of Duke

14

 

 

 

ARTICLE 14. 

Apportionment of Rents, Taxes and Other Charges

22

 

 

 

ARTICLE 15.

Broker

23

 

 

 

ARTICLE 16.

Mutual Indemnification

23

 

 

 

ARTICLE 17. 

Taxes

23

 

 

 

ARTICLE 18. 

Reserved

24

 

 

 

ARTICLE 19.

Recording

24

 

 

 

ARTICLE 20. 

Notices

24

 

 

 

ARTICLE 21.

Captions; Exhibits

25

 

 

 

 

i




 

ARTICLE 22. 

Successors and Assigns

26

 

 

 

ARTICLE 23. 

Closing Costs

26

 

 

 

ARTICLE 24.

Governing Law

26

 

 

 

ARTICLE 25. 

Multiple Counterparts

26

 

 

 

ARTICLE 26. 

Representations and Warranties of Company

26

 

 

 

ARTICLE 26. 

Representations and Warranties of Belcrest

26

 

 

 

ARTICLE 27.

Post-Closing Obligations

27

 

 

 

 

 

 

 

Exhibits

Exhibit A

 

Reserved

 

 

 

Exhibit B

 

Operating Agreement

 

 

 

Exhibit C

 

Description of Mark Center 1801/1901

 

 

 

Exhibit D

 

Description of Mark Center 2001

 

 

 

Exhibit E-1

 

Mark Center II Description

 

 

 

Exhibit E-2

 

Mark Center II Description

 

 

 

Exhibit E-3

 

Mark Center II Description

 

 

 

Exhibit E-4

 

Mark Center II Description

 

 

 

Exhibit E-5

 

Mark Center II Description

 

 

 

Exhibit E-6

 

Mark Center II Description

 

 

 

Exhibit E-7

 

Mark Center II Description

 

 

 

Exhibit E-8

 

Mark Center II Description

 

 

 

Exhibit E-9

 

Mark Center II Description

 

 

 

Exhibit F

 

Personal Property

 

 

 

Exhibit G

 

Leases

 

 

 

Exhibit H

 

Assignment of Member Interests

 

 

 

Exhibit I

 

Personal Property Encumbrances

 

 

 

Exhibit J

 

Certification of Non-Foreign Status

 

 

 

Exhibit K

 

Gross Agreed Value of Assets

 

 

 

Exhibit L

 

Reserved

 

 

 

Exhibit M

 

Other Property Owned

 

 

 

Exhibit N

 

Future Development Right of First Offer

 

 

 

Exhibit O

 

Liabilities

 

 

 

Exhibit P

 

Rent Roll and Accounts Receivable Aging Report

 

 

 

Exhibit Q

 

Operating Contracts

ii




 

 

 

Exhibit R

 

Litigation

 

 

 

Exhibit S

 

Reserved

 

 

 

Exhibit T

 

Reserved

 

 

 

Exhibit U

 

Disclosure Items

 

 

 

Exhibit V

 

Unpaid Balance of Assumed Loans

 

 

 

Exhibit W

 

Balances of Escrows

 

iii




 

CONTRIBUTION AGREEMENT

THIS AGREEMENT (the “Agreement”) made and entered into as of the 6th  day of December, 2006 (the “Effective Date) by and among Duke Realty Limited Partnership (“Duke”), an Indiana limited partnership, the Owning Entities (as defined below), Lafayette Real Estate LLC (the “Company”), a Delaware limited liability company and Belcrest Realty Corporation (“Belcrest”), a Delaware corporation.

NOW, THEREFORE, in consideration of One Dollar ($1.00), the covenants set forth in this Agreement and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

ARTICLE 1.  Background:

(a)           The Company.  The Company was formed in the State of Delaware on November 16, 2006 and has qualified to do business in the Commonwealth of Virginia.  Duke and Belcrest intend to enter into that certain Operating Agreement (the “Operating Agreement”) relating to the Company, in the form attached hereto as Exhibit B.

(b)           The Owning Entities.

(i)            Mark Center Buildings, LLC (“Mark Center Buildings”) is a Delaware limited liability company, whose sole member is WTM Master Building, LLC (“WTM Master Building”), the sole member of which is Duke.  The member interest in Mark Center Buildings is referred to as the “MC Buildings Member Interest”.

(ii)           Mark Center 1801/1901, LLC (“Mark Center 1801/1901”) is a Delaware limited liability company, the sole member of which is Mark Center Buildings.  The member interest in Mark Center 1801/1901 is referred to as the “1801/1901 Member Interest”.

(iii)          Mark Center 1801/1901 is the owner of property known and numbered as 1801/1901 N. Beauregard Street, Mark Center, Alexandria, VA more particularly described in Exhibit C.

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(iv)          Mark Center 2001, LLC (“Mark Center 2001”) is a Delaware limited liability company, the sole member of which is Mark Center Buildings.  The member interest in Mark Center 2001 is referred to as the “2001 Member Interest”.

(v)           Mark Center 2001 is the owner of property known and numbered as 2001 N. Beauregard Street, Mark Center, Alexandria, VA more particularly described in Exhibit D.

(vi)          Mark Center Buildings II, LLC (“Mark Center II”) is a Delaware limited liability company, whose sole member is WTM Master Building, the sole member of which is Duke.  The member interest in Mark Center Buildings II, LLC is referred to as the “Mark II Member Interest”.

(vii)         Mark Center II is the owner of nine parcels of property, which are described in Exhibits E1 through E9.

(viii)        Mark Center 1801/1901, Mark Center 2001 and Mark Center II are collectively referred to as the “Property Owners”.

(ix)           The Property Owners, together with Mark Center Buildings and WTM Master Building are collectively referred to as the “Owning Entities”.

ARTICLE 2. Agreement to Contribute; Description of Property; Defined Terms: (a) Duke agrees to cause WTM Master Buildings to contribute to the Company, and Belcrest agrees to cause the Company to accept upon the terms and conditions hereinafter set forth the MC Buildings Member Interest and the Mark II Member Interest.

(b)           For the purposes of this Agreement, the following items referred to in clauses (b)(i), (ii), (iii), (iv) and (v) are hereinafter sometimes referred to as the “Property”:  (i) certain premises described in Exhibits C, D and E1 through E9, together with all right, title and interest of Property Owners in and to any land lying in the bed of any street (opened or proposed) adjacent to or abutting or adjoining such premises, together with all right, title and interest of Property Owners in and to all rights, privileges, rights of way and easements appurtenant to such premises, including, without limitation, all minerals, oil or gas on or under such premises, development rights, air rights, water rights and any easements, rights of way or other interests in, on, or under any land, highway, alley, street or right of way abutting or adjoining such premises (all of the foregoing, the “Real Property”), (ii) all buildings and other improvements located thereon (the

2




“Improvements”, and, together with the Real Property, the “Premises”), (iii) all items of personal property owned by Property Owners and located on the Premises or used in connection with the ownership or operation of the Premises, described in Exhibit F attached hereto and incorporated herein by reference, including, without implied limitation, whether or not listed on Exhibit F, all furniture, fixtures, equipment, machines, apparatus, appliances, supplies and personal property of every nature and description and all replacements thereof owned by Property Owners and located on the Premises or used in connection therewith, including the non-exclusive right to use the trade name Mark Center (the “Trade Name”), but excluding any telephone numbers assigned to the Trade Name (collectively, the “Personal Property”), (iv) any intangible property now or hereafter owned by Property Owners and used in the ownership or operation of the Premises including, without limitation, any plans and specifications, surveys, catalogs, booklets, manuals, files, logs, records, correspondence, tenant lists, tenant prospect lists and other mailing lists, sales brochures and materials, leasing brochures and materials, advertising materials and other similar items, and all title inspections, studies and reports, market studies and similar inspections with respect to the sale, management, leasing, promotion, ownership, maintenance, use, occupancy and operation of the Premises, permits, licenses, approvals, guaranties, warranties, agreements, lease agreements, utility agreements or other rights relating to the ownership, use or operation of the Premises (collectively, the “Intangibles”).  The parties hereto acknowledge and agree that the cash balances of any accounts standing in the name of the Property Owners on or before the Closing Date shall remain the property of Duke and shall not be included in the Property to be contributed under this Agreement.

(c)           The terms listed below shall have the following meanings throughout this Agreement:

Gross Agreed Value:

For each Property, the Gross Agreed Value shall be the Allocated Amount set forth in Exhibit K plus or minus any prorations at Closing, including, but not limited to, prorations of principal and interest payments for any Assumed Loans (as defined below) for the month of Closing.

 

 

 

 

Net Agreed Value:

The amount of the Gross Agreed Value minus the aggregate amount of all outstanding principal and interest due and owing by Property Owners on account of any debt secured directly or indirectly by any of the

 

3




 

 

Properties or any of the Member Interests (as hereinafter defined) (the “Assumed Loans”).

 

ARTICLE 3. Contribution Subject to Leases.  At the time of Closing the Premises will be subject to certain leases (hereinafter called the “Leases”) described in Exhibit G subject to new leasing activity permitted under this Agreement.  Prior to Closing, Property Owners agree to lease the Premises in accordance with Property Owners’ current leasing plan.  Property Owners shall keep Belcrest apprised of leasing activity, and prior to entering into any new leases or lease amendments, Property Owners shall obtain the consent of Belcrest, which consent shall not be unreasonably withheld, conditioned or delayed.  No consent shall be required for any leasing activity of existing Leases that are not in the Property Owner’s discretion (e.g. exercise of express termination rights, renewal rights on pre-negotiated terms, expansion rights on pre-negotiated terms etc.).

ARTICLE 4.  Reserved:

ARTICLE 5.  Form of Contribution:  (a) At each Closing, Duke shall cause the appropriate Owning Entity to contribute the appropriate member interest (the “Member Interest”) by a good and sufficient Assignment of Member Interests (hereinafter referred to as the “Assignment of Member Interests”) in substantially the form attached hereto as Exhibit H, running to the Company pursuant to which the appropriate Owning Entity shall contribute, assign and deliver to the Company the legal and beneficial title to and ownership of one hundred percent (100%) of the Member Interest which Member Interest shall be free and clear of any liens or other encumbrances, all in accordance with this Agreement.  The Assignment of Member Interests shall be duly executed, acknowledged and delivered by Duke at Closing.  It shall be a condition of Closing that the Property shall be free from all liens, encumbrances and encroachments from or on the Property except (i) real estate taxes and other charges payable therewith not yet due and payable, (ii) those of record prior to the Initial Closing or shown on a survey received prior to the Initial Closing but not objected to by Company and agreed to be removed by Duke prior to the Initial Closing, (iii) those Leases applicable to the Property, subject to new leasing activity permitted under this Agreement, and (iv) New Title Matters (hereinafter defined) which are expressly permitted pursuant to Section 12(a)(vi) of this Agreement.  Duke covenants and agrees not to take any action and to cause the Owning Entities not to take any action which would cause or permit a failure of the foregoing condition.

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(b)           Except as set forth on Exhibit I, the Personal Property shall be owned by the Owning Entities free of all liens, charges, encumbrances, rights, restrictions and agreements of any nature.

(c)           Except as provided for in Article 12, Duke shall not allow Owning Entities to commit any acts which will result in New Title Matters (hereinafter defined) or New Personal Property Matters (hereinafter defined) between the date hereof and the Closing, and Duke shall not commit any acts which will result in a lien or other encumbrance against the Member Interest between the date hereof and the Closing.

ARTICLE 6.  Closing:

(a)           (i)            The closing of the contribution of the Mark II Member Interest (the “Initial Closing”) shall take place at 10:00 a.m. no later than December 4, 2006 (the “Initial Closing Date”); at the offices of Goulston & Storrs, P.C., or at such other location as Company shall designate by five (5) business days prior written notice.  Time is of the essence.

(ii)           The parties hereto acknowledge that certain consents from lenders (“Existing Lenders”) of the Assumed Loans (hereinafter defined) and modification of the relevant management agreements are necessary prior to the contribution of the MC Buildings Member Interests.  Each such consent and modification shall be a “Lender Consent” if (A) such consent does not contain any conditions which are not reasonably satisfactory to Duke or Belcrest (Belcrest acknowledges and consents that Belcrest will be added as a joint and several indemnitor and/or guarantor in all instances where Duke is an indemnitor and/or guarantor on an Assumed Loan) and (B) such consent also grants consent to all upper tier transfers and pledges of interest which additional consent is necessary in light of the structure and secured credit facilities of Belcrest and its owners.  Accordingly, the closing of the contribution of such interests (the “Phase II Closing”) and the payment thereof shall occur five (5) business days after satisfaction of any conditions to such Lender Consent (the “Phase II Closing Date”); provided, however, if the Lender Consent is not obtained by August 1, 2007, then Duke or Belcrest may terminate this Agreement as to any contributions of interests that have not then been consummated by notice to the other of them, provided that said termination notice is received prior to the receipt of the Lender Consent.

(iii)          For purposes hereof, any reference to “Closing” shall mean the Initial Closing or each Phase II Closing as applicable.  Any reference to

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“Closing Date” shall mean the Initial Closing Date or each Phase II Closing Date as applicable.

(b)           At each Closing, Duke shall deliver, or cause Owning Entity to deliver, the following documents, in the form annexed hereto or otherwise reasonably satisfactory in form and substance to Belcrest and Belcrest’s counsel, properly executed and acknowledged as required:

(i)                                     The Assignment of Membership Interests;

(ii)                                  An original counterpart of the Operating Agreement executed by Duke (for the Initial Closing);

(iii)                               Lender’s Consent with respect to the Properties which are encumbered by an Assumed Loan.

(iv)                              A certification of non-foreign status in the form attached hereto as Exhibit J;

(v)                                 Evidence satisfactory to the Company and to the Company’s title insurance company (the “Title Company”) that all necessary approvals and/or consents by any other person(s) have been delivered and such other evidence satisfactory to Company and the Title Company of Duke’s authority and the authority of the signatory on behalf of any constituent person of Duke to convey the Member Interest pursuant to this Agreement;

(vi)                              Affidavits sufficient for the Title Company to delete any exceptions for parties in possession (other than tenants under the Leases, as tenants only), mechanics’ or materialmen’s liens from, and to include a non-imputation endorsement to, the owner’s title insurance policy (the “Title Insurance”), and such other affidavits relating to the Title Insurance as the Title Company may reasonably request;

(vii)                           A certificate restating as of the relevant Closing Date all of Duke’s and