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Exhibit 99.3
CONTRIBUTION AND SALE AGREEMENT
Between
NEW PLAN EXCEL REALTY TRUST,
INC.
And
GALILEO AMERICA LLC,
And
GALILEO AMERICA, INC.,
Dated as of July 19, 2005
TABLE OF CONTENTS
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INDEX OF DEFINED TERMS
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CONTRIBUTION AND SALE AGREEMENT
CONTRIBUTION AND SALE AGREEMENT (this “ Agreement “) dated as of July 19, 2005, between NEW PLAN EXCEL REALTY TRUST, INC. , a Maryland corporation, having an address at 420 Lexington Avenue, 7th Floor, New York, New York 10170 (“ NXL “) and various direct and indirect wholly owned or controlled subsidiaries of NXL set forth on Exhibit A annexed hereto (the “ Subsidiaries “; NXL and the Subsidiaries are collectively, the “ Owner “), GALILEO AMERICA LLC , a Delaware limited liability company, having an address at c/o Galileo Funds Management Limited, Level 9, 1 Alfred Street, Sydney NSW 2000, Australia, Attention: Mr. Brett Bradley (the “ Company “), and GALILEO AMERICA, INC. , a Maryland corporation, having an address c/o Galileo Funds Management Limited, Level 9, 1 Alfred Street, Sydney NSW 2000, Australia, Attention: Mr. Brett Bradley (the “ REIT “). All defined terms used herein are defined herein and can be located using the Index of Defined Terms set forth above.
RECITALS :
A. Owner is either the fee owner of or is the lessee under a ground lease of the land and buildings and other improvements thereon and appurtenances thereto (or the lessee under a ground lease of the land and the fee owner of the buildings and other improvements thereon) set forth on Exhibit B-1 annexed hereto (each, a “ Contributed Property “ and collectively, the “ Contributed Properties “).
B. Owner is either the fee owner of or is the lessee under a ground lease of the land and buildings and other improvements thereon and appurtenances thereto (or the lessee under a ground lease of the land and the fee owner of the buildings and other improvements thereon and appurtenances thereto) set forth on Exhibit B-2 annexed hereto (each, a “ Sale Property “ and collectively, the “ Sale Properties “; the Sale Properties, together with the Contributed Properties, are referred to collectively as the “ Properties “).
C. The Company was formed in 2003 for the purpose of acquiring interests in retail shopping centers located in the United States (other than regional malls), such as the Contributed Properties and the Sale Properties.
D. Concurrently herewith, the Company, CBL & Associates Limited Partnership (“ CBL “), the REIT, the A-LPT and NXL have entered into a Redemption Agreement (the “ Redemption Agreement “), pursuant to which, among other things, all of CBL’s right, title and interest in the Company will be redeemed in accordance with the terms of such Redemption Agreement.
E. Concurrently herewith, CBL & Associates Management, Inc. (“ CBL Manager “), NXL, the Company, the REIT and the A-LPT have entered into a Purchase and Sale of Management Rights Agreement (the “ Management Rights P&S Agreement “), pursuant to which, among other things, New Plan will acquire all of CBL Manager’s right, title and interest in, under and to certain Property Management and Services Agreements and certain Advisory Property Management Agreements, in each case, between the Company and certain of its affiliates, as owner, and CBL Manager and certain of its affiliates, as manager.
F. The transactions under the Management Rights P&S Agreement and the Redemption Agreement will close concurrently with the transactions contemplated by this Agreement.
G. At the Closing, NXL (and/or one of more Affiliates (as defined in the LLC Agreement) of NXL) and the REIT shall enter into an Amended and Restated Limited Liability Company Agreement of the Company in the form annexed hereto as Exhibit C (the “ LLC Agreement “).
H. At the Closing, ERT Australian Management, L.P. and/or New Plan Australian Management L.P., each of which is an Affiliate of NXL, or such other management company owned or controlled by NXL, and the Company shall enter into one or more Property Management, Services and Leasing Agreements in the form annexed hereto as Exhibit D (the “ Services Agreement “).
I. At the Closing, among other things but subject to Section 21 hereof, Owner shall contribute and/or sell the applicable Properties to the Company, the REIT and/or to certain wholly-owned special purpose entities of the Company to be newly formed prior to the Closing (each, an “ SPE Entity “ and collectively, the “ SPE Entities “), pursuant to the terms of this Agreement and upon the satisfaction of the conditions to Closing set forth herein.
J. Immediately following the sale of the Sale Properties to the REIT, the REIT will contribute all such Properties to the Company.
K. At the Closing, NXL shall receive Shares in the Company and/or cash proceeds pursuant to the terms of this Agreement and the LLC Agreement, as applicable, with respect to the contribution and sale of the Properties, respectively, to the Company and/or the SPE Entities.
NOW THEREFORE , in consideration of the terms and conditions contained in this Agreement, the mutual covenants herein contained and other good and valuable consideration, the mutual receipt and legal sufficiency of which are hereby acknowledged, Owner and the Company hereby agree as follows:
Section 1. Properties to be Contributed and Sold1.01. At the Closing, Owner shall contribute the Contributed Properties and sell the Sale Properties, as applicable, to the Company, the SPE Entities and/or the REIT (or its designee), as designated by the Company in writing prior to the Closing, as follows:(a) At the Closing, Owner shall contribute, assign, transfer and deliver to the Company and/or the SPE Entities (as set forth on Exhibit B-1 ), and the Company and/or the SPE Entities shall receive from Owner, upon the terms and conditions set forth in this Agreement: (1) fee simple and/or leasehold interests in and to the Contributed Properties and (2) all right, title and interest of Owner in and to the fixtures, equipment and other personal property attached or appurtenant to such Contributed Properties (the “ Contributed Personal Property “), both in exchange for the aggregate amount of the Contribution Consideration allocated to the Contributed Properties.(b) At the Closing, Owner shall sell, assign, transfer and deliver to the Company, the SPE Entities and/or the REIT (or its designee) (as set forth on Exhibit B-2 ), and the Company and/or the SPE Entities shall receive from Owner, upon the terms and conditions set forth in this Agreement: (1) fee simple and/or leasehold interests in and to the Sale Properties and (2) all right, title and interest of Owner in and to the fixtures, equipment and other personal property attached or appurtenant to such Sale Properties (the “ Sale Personal Property “ and, together with the Contributed Personal Property, the “ Personal Property “), both in exchange for the aggregate amount of the Sale Prices allocated to the Sale Properties. No independent consideration is being paid for the Personal Property.
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(c) Notwithstanding the foregoing, Owner will sell each Property listed on Schedule 1.01(c) to the REIT in exchange for the Sale Price allocated to each such Property pursuant to Exhibit B-2 . Immediately following such sale to the REIT and as part of the closing of the transactions under this Agreement, the REIT shall contribute all such Properties to the Company. The REIT may instruct Owner prior to the Closing, that the documents executed by Owner to convey the Properties set forth on Schedule 1.01(c) at the Closing be made to the Company or any SPE Entity so designated by the REIT. Any additional costs and expenses associated with the multiple transfers under this Section 1.01(c) shall be borne by Owner.(d) Prior to the Closing and at Owner’s election, Owner may convert any of the Contributed Properties into Sale Properties, so long as (i) such conversion does not result in any Property becoming subject at any time to any provision of Section 7.02 of the LLC Agreement (other than clause (y) in Section 7.02(a) of the LLC Agreement) which would not otherwise have been subject thereto, (ii) such conversion does not result in the payment by the Company of any more cash to Owner in respect of the Properties than would have been paid in respect of such Properties if such conversion had not occurred. For clarity, it is understood that, notwithstanding any schedules hereto to the contrary, the allocation of cash and noncash consideration for each Property shall be appropriately adjusted to reflect any such conversions, and (iii) such conversion (together with all other conversions under this Section 1.01(d)) would not result in U.S. federal income tax deductions for REIT having a present value lower than the deductions that would have resulted if such conversion had not occurred, assuming the Company holds all the Properties following the Closing until the end of their useful lives.1.02. For purposes of this Agreement, the term “ Properties “ shall also include, without limitation, all easements, rights of way, strips, gores, privileges, licenses, appurtenants and other tangible and intangible rights, benefits and interests, appurtenant thereto, including, without limitation, all right, title and interest of Owner in and to any streets or other public ways adjacent to the Properties and any water, sewer, utility district or mineral rights owned by, or leased to, Owner, all improvements located on each Property and all structures, systems and utilities associated with and utilized by Owner (but excluding any improvements owned by tenants under any Leases at the Properties), all tangible personal property owned by Owner and located on the land or used in connection with each Property and all of Owner’s right, title and interest in and to all Leases, Ground Leases, all security deposits given under all Leases, the Ground Leases and all Service Contracts and other agreements to the extent adjustment is made pursuant to Section 14 , any permits, warranties, guaranties (in each case, relating to the Properties and to the extent transferable), plans, specifications, drawings, tenant files, and property files relating to the Properties, and all pads or outparcels related to any of the Properties that are included in the legal descriptions attached to the Pro Forma Policies for the applicable Properties. Notwithstanding the foregoing, in no event will the Properties include any property (real, personal or otherwise) that is owned by any tenant or any other Person.1.03. Owner has made or will make available for inspection by the Company or has delivered to the Company true, correct and complete copies of (a) the materials contained in those certain compact disks and the web site identified on Schedule 1.03 annexed hereto, (b) organizational documents for all of the Entity Owners to be acquired by the Company pursuant to Section 21.01 , together with copies of any board minutes, resolutions and other similar materials in Owner’s possession or control, and (c) any other materials reasonably requested by the Company or delivered to the Company (collectively, the “ Review Materials “). The Review Materials and any other materials, reports, surveys, books and records examined by or on behalf of the Company pursuant to this Agreement (including, without limitation, the Due Diligence Materials) shall: (i) be held in strict confidence by the Company and the REIT, (ii) not be used for any purpose other than the investigation and evaluation of the Properties by the Company and its lenders, attorneys, financial advisors, investors, accountants, partners, members, directors, officers, employees, agents, engineers and consultants involved or likely to be involved in this
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transaction (collectively, the “ Agents “), and (iii) not be disclosed, divulged or otherwise furnished to any other person or entity prior to the Closing except to the Agents, as otherwise contemplated herein, or as required by law or court order and, for the avoidance of doubt, must not be disclosed as being attributable in any way to owner in the product disclosure statement to be issued under the Trust Offering. If this Agreement is terminated for any reason whatsoever, the Company and the REIT shall, at its option, destroy or return to Owner all of the Review Materials and Due Diligence Materials in the possession of the Company and the Agents; provided , however, that notwithstanding the foregoing, if this Agreement is terminated by the Company due to a default by Owner, the Company shall only be required to return the Review Materials which were provided by the Owner to the Company. The provisions of this Section 1.03 shall survive the termination of this Agreement.Section 2. Objections to Title2.01. (a) Prior to the date hereof, the parties have caused Fidelity National Title Insurance Company (the “ Title Company “) to issue to the Company pro forma ALTA title insurance policies for each of the Properties (together with any updates and endorsements thereto, collectively, the “ Pro Forma Policies “). The Pro Forma Policies are listed on Schedule 2.01(a) , and the title insurance policies to be issued at the Closing by Title Company shall be in the forms of the Pro Forma Policies, in the aggregate amount of the Contribution Consideration and the Sale Price (allocated amongst the Properties as the Company shall require at the Closing) and shall contain the endorsements (including non-imputation), affirmative coverages and reinsurance and/or co-insurance as are attached to (or referenced in) the Pro Forma Policies (collectively, the “ Title Policies “). The Company’s obligation to close the transactions contemplated by this Agreement shall be conditioned on receipt by the Company, at Closing, of the Title Policies, insuring the Company’s title to the Properties subject only to (i) the exceptions contained in the Pro Forma Policies as of the date hereof (the “ Permitted Exceptions “), (ii) the exceptions set forth on Schedule 2.01(a) annexed hereto, (iii) any other matters to which the Company is required to accept title to the Properties pursuant to the terms of this Agreement, and (iv) otherwise free and clear of all standard or general exceptions contained in the Pro Forma Policies which the Title Company is permitted by applicable law to remove or modify upon delivery of the Surveys and customary title affidavits from Owner. The Company has obtained UCC, judgment, lien and bankruptcy searches on Owner and the Properties (as applicable) (together with any updates thereto, collectively, the “ Searches “) prior to the date hereof and has reviewed and accepted the matters shown thereon as of the date hereof (other than UCC-1 financing statements that secure the repayment of mortgage indebtedness or other monetary indebtedness to be repaid by Owner prior to, or concurrently with, the Closing).(b) Prior to the date hereof, Owner has delivered to the Company and the Title Company updated surveys of each of the Properties (each, a “ Survey “ and, collectively, the “ Surveys “; the Surveys are described in the applicable Pro Forma Policies), which Surveys are certified to the Company and the Title Company.(c) With respect to the Properties commonly known as “London Marketplace” in Lexington, Kentucky and “University Plaza” in Canton, New York, the parties hereby acknowledge that a portion of the Property was not surveyed prior to the date hereof and, in the case of University Plaza, a portion of the Property is not covered by the Pro Forma Policy with respect to such Property. Prior to the Closing, the parties shall cause (i) the Title Company to issue a Title Commitment with respect to the portion of University Plaza that is not covered by the Pro Forma Policy as of the date hereof and, subsequently, to revise and reissue the Pro Forma Policy with respect to such Property, and (ii) the applicable surveyors to revise the Surveys with respect to London Marketplace and University Plaza so as to include the portions of such Properties that are not covered by the Surveys as of the date hereof. With respect to New Exceptions reflected on the Title Commitment described in (i) and/or the revised Surveys described in (ii), the Company shall have the right to deliver a Defect Notice to Owner
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pursuant to and in accordance with Section 2.01(d) , and the provisions of Section 2.01(d) – Section 2.01(h) shall apply with respect thereto.(d) If, after the date hereof but prior to the Closing and subject to Section 2.01(e) , (i) the Company receives written notification of any new title matters (including a survey matter or UCC, judgment or bankruptcy filing) that are (x) not Permitted Exceptions and (y) (in the case of a title or survey matter) raised by the Title Company as an additional exception in any Title Commitment or Pro Forma Policy (each such new title matter that satisfies (x) and (y) is hereinafter referred to as a “ New Exception “), and (ii) the Company objects to such New Exception, the Company shall give written notification to NXL of such New Exception(s) (each, a “ Defect Notice “ and each such New Exception in respect of which a Defect Notice is delivered, a “ Defect “); provided, however, the Company shall not have the right to deliver a Defect Notice with respect to any matter listed on Schedule 2.01(a) attached hereto (and in no event shall any such matter be deemed to be a Defect). A Defect Notice shall be delivered, if at all, within five (5) Business Days of the Company’s receipt of such written notification of the New Exception in question (or, prior to Closing, in the case of any New Exception with respect to which the Company receives written notification less than five (5) Business Days before Closing). Within five (5) Business Days of its receipt of any Defect Notice from the Company (but in all events at or before the Closing), Owner shall notify the Company whether Owner elects to cure such Defect. Subject to Section 2.01(g) , if Owner does not timely elect to cure any Defect, the Company shall have the right (i) to drop the affected Property by delivering written notice thereof to Owner or (ii) if the Dropped Property Threshold has been exceeded (or would be exceeded if the Property in question were dropped), (A) to waive such Defect, and in the event of such waiver, (x) the Company will be deemed to have rescinded its Defect Notice with respect thereto, (y) such Defect shall be deemed approved by the Company and shall constitute a Permitted Exception hereunder, and (z) the Company shall be obligated to close without any deduction from the aggregate Contribution Consideration or Sale Price payable to Owner at the Closing, or (B) to terminate this Agreement by giving written notice of such termination to Owner, whereupon this Agreement shall terminate, and neither Owner nor the Company shall have any further liability to the other hereunder, except with respect to the Surviving Obligations.(e) With respect to Defect Notices relating to a New Exception first appearing in the applicable public records after the date hereof, Owner shall have the right, but not the obligation, to cure any such Defect within fifteen (15) days after its receipt of the Defects Notice, or in the case of any Defect which cannot with due diligence be cured within such 15-day period, such later date by which such Defect can reasonably be cured, provided that Owner commences to cure such Defect within such 15-day period and thereafter continues diligently and in good faith to cure the Defect; provided , however , that the Closing shall not be extended in order to permit the cure described above. In the event that Owner elects not to cure any Defect described in the preceding sentence or is unable to effect such cure prior to the Closing, the Company shall have the remedies provided in Section 2.01(d) hereof.(f) Notwithstanding anything to the contrary contained in this Agreement, (1) Owner shall have no obligation to cure (i) any Defect created solely by any acts or omissions of the Company and/or its Agents, (ii) any New Exception raised in any Title Commitment or Pro Forma Policy after the date hereof that is not a Curable Defect and that was recorded in the applicable public record prior to the date hereof (a “ Record Defect Not Subject to Cure “), (iii) Leases executed in accordance with the terms of Section 7 or (iv) any New Exception other than a Curable Defect, the cost of which to cure, exceeds (A) with respect to any one Property, the lesser of (i) $3,000,000 or (ii) 25% of the Contribution Consideration or Sale Price, as applicable, for the affected Property or (B) $10,000,000 in the aggregate, with respect to all of the Properties (as reduced by deductions and unrefunded escrowed amounts pursuant to Section 2.01(g) , and the documented costs incurred by Owner in attempting to cure Defects, the “ Title
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Cap “) (unless the Company shall pay for all amounts in excess of such limitations to effect such cure), and (2) Owner’s failure to cure any such Defect or New Exception (as the case may be) shall not relieve the Company from its obligation to close under this Agreement. If the cost to cure any item described in clause (iv) above exceeds $1,000,000, then at Owner’s election and subject to the Dropped Property Threshold, in lieu of curing such New Exception, Owner may drop the affected Property by delivering written notice thereof to the Company.(g) If, prior to the Closing, Owner has failed to cure (as determined in the commercially reasonable discretion of the Company) all Defects which it is obligated to cure pursuant to Section 2.01(c) or that Owner has elected to cure pursuant to Section 2.01(d) or Section 2.01(e) , the Company shall nonetheless be obligated to proceed to close subject to any such Defects. In such event, at Owner’s sole election, (i) the Company shall deduct from the Contribution Consideration or Sale Price, the cost to cure such Defect as mutually agreed to by the Company and Owner in their commercially reasonable discretion, or (ii) Owner shall place into escrow with the Title Company, pursuant to an escrow agreement in a form mutually agreed to by the parties, the cost to cure such Defect as mutually agreed to by the Company and Owner in their commercially reasonable discretion; provided , however , that in no event (other than with respect to a Curable Defect) shall the amount of such deduction or such escrow, together with all amounts paid by Owner to cure Defects (other than Curable Defects) exceed (x) the Contribution Consideration or the Sale Price allocated to such Property, with respect to any individual Property, or (y) the Title Cap, in the aggregate. In no event shall an amount so deducted or escrowed reduce the amount available under the Cap; provided , however , that in the event that the subject Defect constitutes a breach of the representations and warranties contained in Section 5.01(j) or Section 5.01(p) , the Company shall not be entitled to indemnification with respect thereto pursuant to Section 5.05(a) , to the extent of amounts escrowed or paid in accordance with this Section 2.01(g) .(h) Notwithstanding anything to the contrary contained in this Section 2.01 , in the event that any Defect is a mortgage, lien, defect, fine in respect of a violation of law relating to a Property (which fine constitutes a lien thereon), encumbrance or other exception to title against such Property created by the action or inaction of Owner or its affiliates against or affecting a Property that can be removed or cured by payment of a readily ascertainable sum of money (collectively, the “ Curable Defects “), Owner must either satisfy such Curable Defect(s) of record or, as an alternative to causing such Curable Defect(s) to be satisfied of record and provided that the Title Company agrees to omit such Curable Defect(s) from the Title Policies: (i) bond or cause to be bonded such Curable Defect(s), (ii) deliver or cause to be delivered to the Title Company, on the date of the Closing, instruments in recordable form and sufficient to satisfy such Curable Defect(s) of record, together with the appropriate recording or filing costs, (iii) deposit or cause to be deposited with the Title Company sufficient monies, acceptable to and reasonably requested by the Title Company, to assure the obtaining and recording of a satisfaction of the Curable Defect(s) or (iv) provide the Title Company with undertakings and/or indemnities with respect to one or more Curable Defects that can be cured or removed by payment of not more than the $1,000,000 in the aggregate. With respect to all Curable Defects, in no event shall Owner be required to expend an amount to cure the same greater than the portion of the Contribution Consideration or Sale Price allocated to the Property in question; provided that if the amount required to cure a Curable Defect is greater than the portion of the Contribution Consideration or Sale Price allocated to the Property in question, then at the Company’s election the Company may drop the affected Property, subject to the provisions of Section 5.06 and Section 8 hereof. If the Monetary Lien that is required to be cured is a mechanic’s lien, materialman’s lien or similar lien which is the responsibility of a tenant of the Properties, from and after the Closing, (i) the Company shall enforce the terms of such tenant’s Lease (without any obligation, however, to terminate the applicable Lease) with respect to the payment of all amounts secured by such lien(s) (including any obligation to reimburse the landlord under the Lease for amounts expended by the landlord in respect of such liens) and (ii) the Company shall reimburse Owner for all costs incurred by Owner in curing such Defects to the extent that any funds are recovered from
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such tenant(s) in respect thereof (net of reasonable collection costs), which obligations of Company shall survive the Closing.Section 3. Contribution Consideration and Sales Consideration3.01. Contribution Consideration .(a) Exhibit B-1 annexed hereto sets forth the agreed upon contribution consideration for each of the Contributed Properties (with respect to each Property, as set forth on Exhibit B-1 , and, collectively with respect to all of the Properties, the “ Contribution Consideration “). The Company, in reliance on the representations and warranties set forth herein, shall issue at the Closing membership interests in the Company (the “ Shares “) to NXL in an amount to be determined on the basis of the aggregate amount of (i) the Contribution Consideration allocated to the Contributed Properties (up to the Required Contribution Amount) and (ii) the cash, if any, contributed to the Company by Owner as a capital contribution.(b) Owner and the Company hereby acknowledge and agree that the value of the non-real estate assets associated with the Properties to be contributed to the Company and/or the SPE Entities is de minimis and no part of the Contribution Consideration is allocable thereto.3.02. Determination and Allocation of Sales Consideration .(a) Exhibit B-2 annexed hereto sets forth (i) the agreed upon sale consideration for each of the Sale Properties (with respect to each Property, as set forth on Exhibit B-2 , and, collectively with respect to all of the Properties, the “ Sale Price “) and (ii) the allocation of such Sale Price among NXL and each of the Subsidiaries.(b) Owner and the Company hereby acknowledge and agree that the value of the non-real estate assets associated with the Properties to be sold to the Company, the SPE Entities and/or the REIT is de minimis and no part of the Sale Price is allocable thereto.3.03. The amounts set forth in Exhibit B-1 and Exhibit B-2 shall each be adjusted as of the respective Closing to reflect any adjustments made pursuant to Section 2.01(c) , Section 8 , Section 14 and any other adjustments to the Contribution Consideration or Sale Price with respect to any Property (plus or minus) made in accordance with any other term or provision of this Agreement.3.04. At the Closing, the Company, the SPE Entities and/or the REIT, as applicable shall (a) for the applicable Sale Properties, pay the Sale Price for such Properties (plus or minus adjustments and prorations pursuant to the terms of this Agreement (including, without limitation, Section 14 )) to Owner or such other entity as directed by Owner to effectuate the transactions contemplated hereby, and (b) for the Contributed Properties, issue the applicable Shares to the Owner. In addition, if the aggregate amount of the Contribution Consideration with respect to all of the Properties contributed to the Company by Owner at the Closing is less than the Required Contribution Amount (as defined below), at the Closing, (i) New Plan shall contribute to the Company cash in an amount equal to (x) 11.57% of the amount by which the aggregate Contribution Consideration and the aggregate Sale Price with respect to all of the Properties exceeds the amount of financing that is obtained by the Company with respect to such Properties (the “ Required Contribution Amount “), minus (y) the Contribution Consideration in respect of Properties contributed to the Company by Owner (or such other amount as may be agreed to by the Company and Owner such that the difference of (x) and (y) will result in an aggregate membership interest in the Company of 5%), and (ii) the Company shall issue additional Shares to the Owner in respect of such additional capital contribution.
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3.05. All cash monies payable by the Company to Owner under this Agreement shall be made in United States dollars and shall be paid by Federal funds wire transfer of immediately available funds pursuant to this Agreement. All references in this Agreement to “dollars” or “$” shall mean United States dollars.3.06. The Company shall arrange all financing (in addition to the net proceeds of the Trust Offering) required in order to complete the transactions contemplated by this Agreement, the net proceeds of which additional financing, together with the Company’s other assets (including the net proceeds of the Trust Offering), will (i) be sufficient to pay to Owner at Closing all amounts to which Owner is entitled and (ii) actually be paid (or distributed by the Company) to Owner and/or the REIT (which shall, in turn, pay the same to Owner) to the extent necessary to pay Owner (x) the aggregate Sale Price for all of the Sale Properties and (y) the amount, if any, by which the aggregate Contribution Consideration of the Properties contributed to the Company exceeds the Required Contribution Amount. The parties agree that the original principal amount of the additional financing obtained by the Company in connection with the Closing will be up to the approximate amount of $629,000,000 (subject to deferred funding in respect of the Lockout Properties). The Company shall use the proceeds of such financing to pay a portion of the aggregate Sale Price to Owner.Section 4. The Closing4.01. Except as otherwise provided in this Agreement, the contribution and sale of the Contributed Properties and Sale Properties and the delivery of the Shares pursuant to the LLC Agreement and the Sale Price as contemplated herein shall be consummated at a closing (the “ Closing “) that shall take place on the date (such date, the “ Closing Date “) that is 48 hours after receipt by Galileo Shopping America Trust (the “ A-LPT “) of the settlement proceeds from the institutional component of the the A-LPT’s non-renounceable 5 for 8 entitlement offer and public offer of new units in the A-LPT (the “ Trust Offering “), or such other earlier date as may be agreed to by the parties hereto, as to which date time shall be of the essence, at the offices of Willkie Farr & Gallagher LLP, 787 Seventh Avenue, New York, New York 10019, or such other location as the parties may agree upon; provided , however , that if the Closing has not occurred on or before September 30, 2005 (the “ Closing Deadline “), as to which date time shall be of the essence, either NXL or the Company may elect, at its option, to terminate this Agreement by giving the other party written notice of the exercise of such election at any time after the Closing Deadline, whereupon this Agreement shall terminate, and neither Owner nor the Company shall have any further liability to the other hereunder, except with respect to the covenants and indemnities explicitly stated to survive such termination, including, but not limited to those contained in Section 1.03 , Section 16 and Section 19 (the “ Surviving Obligations “).4.02. Notwithstanding anything to the contrary contained in this Agreement, (a) if Owner is unable to prepay or defease the existing indebtedness on one or more of the Lockout Properties prior to the Closing and (b) provided that the Closing has occurred with respect to all of the other Properties, with respect to such Lockout Properties (and only with respect to such Lockout Properties), the sale of such Properties and the payment of the Sale Price as contemplated herein shall be consummated at a closing (the “ September Closing “) that shall take place at 10:00 a.m. on September 8, 2005 (the “ September Closing Date “), or such other earlier date as may be agreed to by the parties hereto, as to which date time shall be of the essence, at the offices of Willkie Farr & Gallagher LLP, 787 Seventh Avenue, New York, New York 10019, or such other location as the parties may agree upon. If the September Closing Date is different than the Closing Date, then for all purposes of this Agreement with respect to the Lockout Properties, the defined term “Closing” shall be deemed to mean the September Closing and the defined term “Closing Date” shall be deemed to mean the September Closing Date. If the Closing with respect to all of the other Properties has not occurred on or before the September Closing Date, this Section 4.02 shall be of no further force or effect and the provisions of Section 4.01 shall
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govern with respect to all of the Properties (including the Lockout Properties). As used in this Section 4.02 , the “ Lockout Properties “ means the Properties commonly known as Tuckernuck Square in Richmond, Virginia, Northside Plaza in Dalton, Georgia and Merchant’s Central in Winchester, Tennessee.Section 5. Representations and Warranties5.01. NXL hereby represents and warrants as to all of the Properties and all of the Subsidiaries included in the definition of “Owner” (and each of such Subsidiaries represents and warrants as to itself and as to the Property(ies) that it sells, contributes or otherwise transfers to the Company and/or the SPE Entities (or the REIT, as applicable) (but each Subsidiary represents and warrants only as to itself and its Properties, and not as to any other Owner or any other Property)) as follows:(a) (i) NXL (x) is a corporation organized, existing and in good standing under the laws of the State of Maryland, (y) is qualified and in good standing in each of the states in which each of the Properties owned by it are located (to the extent required by law), except where the failure to do so would not have a material adverse effect on the ability of NXL to fulfill its responsibilities under this Agreement, and (z) has the requisite power and authority (I) to enter into this Agreement and all documents contemplated hereunder to be entered into by NXL, and (II) to perform the terms and obligations of NXL under this Agreement and all such other documents.
(ii) Each of the Subsidiaries (x) is a corporation, limited partnership or limited liability company formed, existing and in good standing under the laws of the state of its formation, (y) is qualified and in good standing in each of the states in which each of the Properties owned by it are located (to the extent required by law), except where the failure to do so would not have a material adverse effect on the ability of such Subsidiary to fulfill its responsibilities under this Agreement and (z) has the requisite power and authority (I) to enter into this Agreement and all documents contemplated hereunder to be entered into by such Subsidiary, and (II) to perform the terms and obligations of such Subsidiary under this Agreement and all such other documents.
(b) Subject to obtaining the Required Owner Consents, the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby on the part of (i) NXL have been duly authorized by all necessary corporate action and (ii) each of the Subsidiaries have been duly authorized by all necessary corporate, limited partnership or limited liability company action, as applicable, and no other proceedings or consents on the part of Owner are necessary in order to permit it to consummate the transactions contemplated hereby.
(c) This Agreement has been duly executed by Owner and all of Owner’s obligations hereunder are the legal, valid and binding obligations of Owner, enforceable in accordance with the terms of this Agreement, subject to applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and other similar laws relating to or affecting creditors’ rights generally from time to time in effect and to general principles of equity (including concepts of materiality, reasonableness, good faith and fair dealing), regardless whether considered in a proceeding in equity or at law.
(d) Subject to obtaining the Required Owner Consents, Owner’s performance of its duties under this Agreement will not conflict with, result in a breach of or be a default under, or be adversely affected by, any existing agreements, instruments, judgments, permits, orders, rules, regulations or decrees to which Owner is a party or by which it or its assets are bound.
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(e) Owner is not the subject of any bankruptcy, reorganization, insolvency or similar proceedings on the date hereof. To Owner’s knowledge, there are no such proceedings threatened against Owner, nor are any such proceedings contemplated by Owner.
(f) Annexed hereto, collectively, as Schedule 5.01(f)-1 is a true, correct and complete copy of the rent rolls for the Properties (the “ Rent Rolls “) identifying and listing in detail, as of the date thereof, by tenant and vacant area, as applicable, tenants, square footage, monthly fixed rent, percentage rent, monthly estimates for common area maintenance contributions, security deposits, rent commencement and expiration dates, and renewal and extension options. To Owner’s knowledge, the information concerning written leases or occupancy agreements for the Properties (which together with all existing amendments and modifications thereof are collectively referred to as “ Leases “) set forth on Schedule 5.01(f)-1 is accurate in all material respects as of the date hereof. Except as set forth on Schedule 5.01(f)-2 , Owner has not given, nor to Owner’s knowledge has Owner received, any written notice of a material default (which remains outstanding) under any of the Leases (the foregoing does not apply to notices delivered to tenants in respect of delinquencies in the payment of monthly rent that are identified on Schedule 5.01(f)-2 annexed hereto). The parties hereto acknowledge that such Rent Rolls may not list (and, to the extent that such Rent Rolls do not list, Owner makes no representation or warranty with respect to) (i) subleases, concessions, or license agreements which may have been entered into by tenants or subtenants (unless such subleases, concessions, or license agreements were known to Owner), (ii) license or concession agreements that have terms not in excess of sixty (60) days or are terminable by the landlord without penalty, or (iii) kiosks or pushcarts occupied under agreements that are terminable by the landlord without penalty upon not more than one month’s notice. Annexed hereto, collectively, as Schedule 5.01(f)-2 is a true, correct and complete list of all tenant arrearages for all of the Properties (in each case, as of the date set forth on such schedule for the Property in question (and not on a lease-by-lease basis)).
(g) Annexed hereto as Schedule 5.01(g) is a true, correct and complete list of the Leases, all amendments thereto and all other material agreements currently in effect between Owner and the Major Tenants with respect to the Properties (collectively, the “ Major Tenant Documents “), and true, correct and complete copies of each Major Tenant Document (including, without limitation, all of the New Major Tenant Documents) have been delivered or made available to the Company. To Owner’s knowledge, each Major Tenant Document is in full force and effect. Except as set forth on Schedule 5.01(g) , to Owner’s knowledge, Owner has not received any written notice that Owner is in breach or default under any Major Tenant Document, which breach or default remains uncured on the date hereof. (i) Other than the New Major Tenant Documents, since March 15, 2005, (x) there have been no Leases or amendments to Leases with Major Tenants and (y) Owner has not entered into any other material agreements with any Major Tenants with respect to the Properties, and (ii) except as set forth on Schedule 5.01(g) , Owner has not sent any written notice to any of its respective Major Tenants within the twelve (12) month period preceding the date hereof asserting that such Major Tenant is in breach or default under any Major Tenant Document to which it is a party, which breach or default remains uncured on the date hereof. As used in this Agreement, (i) “ Major Tenant “ means (x) the tenant under any Lease that demises 30,000 square feet or more of GLA at any Property (but only for purposes of the clause (i) of the immediately preceding sentence) and (y) the tenants identified on Schedule 5.01(g) annexed hereto (for all other purposes of this Agreement) and (ii) “ New Major Tenant Documents “ has the meaning ascribed thereto in Schedule 5.01(g) .
(h) Schedule 5.01(h) annexed hereto is a true, correct and complete list of all ground leases under which Owner is the ground lessee, including all existing amendments and modifications thereto (collectively, “ Ground Leases “) affecting the Properties. To Owner’s knowledge, all Ground Leases affecting the Properties are in full force and effect. Owner has not given, nor has Owner received, any written notice of a default (which remains outstanding) under any Ground Lease.
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(i) Annexed hereto as Schedule 5.01(i) is a true, correct and complete list of all reciprocal easement agreements currently in effect and related to the Properties (the “ Reciprocal Easement Agreements “), and true, correct and complete copies of each of the Reciprocal Easement Agreements have been delivered or made available to the Company. To Owner’s knowledge, each of the Reciprocal Easement Agreements are in full force and effect. Except as set forth on Schedule 5.01(i) , Owner has not received any written notice that Owner is in breach or default under any of the Reciprocal Easement Agreements, which breach or default remains uncured on the date hereof.
(j) Other than the Permitted Exceptions, there are no agreements that materially and adversely restrict the use of any of the Properties as a retail shopping center.
(k) A true, correct and complete list of all outstanding written agreements for the payment of leasing commissions by the party holding the interest of landlord with respect to the Properties under which such landlord is required to pay any leasing commissions, brokerage fees or any other fee or charge that is due and payable on or after the Closing is set forth on Schedule 5.01(k)-1 annexed hereto (such agreements are collectively referred to as the “ Brokerage Agreements “). Schedule 5.01(k)-1 also contains a true, correct and complete list of all leasing commissions that may first become due under the Leases on or after the Closing Date. With respect to the Properties, Schedule 5.01(k)-2 annexed hereto sets forth a true, correct and complete list of all (i) leasing commissions with respect to the current unexpired term thereof which have been earned and are payable under the Brokerage Agreements prior to the date of this Agreement which have not been paid and (ii) any leasing commissions already earned under the Brokerage Agreements and which are payable in one or more installments after the date of this Agreement and with respect to which not all installments have been paid. To Owner’s knowledge, Owner is not in default under, or in breach of, any Brokerage Agreements, and no event has occurred which, with the giving of notice or the passage of time or both, would constitute a default under any of the Brokerage Agreements.
(l) Schedule 5.01(l) annexed hereto contains a true, correct and complete list of all Material Service Contracts. For purposes hereof, “ Material Service Contracts “ shall mean all contracts (except for Leases, Ground Leases, Brokerage Agreements, and Management Contracts), relating to the management, leasing, operation, maintenance or repair of the Properties or that would otherwise affect the use, operation or enjoyment of the Properties (collectively, “ Service Contracts “) that are either (i) not terminable upon one month’s notice or less without payment or penalty; or (ii) for which the services thereunder cost in excess of $25,000 per annum with respect to any individual Property. To Owner’s knowledge, all of the Material Service Contracts are in full force and effect and there are no material defaults thereunder. All Service Contracts (other than those executed in contravention of the terms hereof) shall be assigned to, and assumed by, the Company or the SPE Entities, as applicable, at the Closing.
(m) Schedule 5.01(m) annexed hereto is a true, correct and complete list of all of the management contracts relating to each of the Properties (the “ Management Contracts “). The Management Contracts comprise all of the management agreements between Owner and any other person or entity, and other than the parties to the Management Contracts there is no other person or entity engaged in a similar capacity with respect to the Properties. All Management Contracts may, by the express terms thereof, be terminated without penalty or other payment by Owner (or its successors or assigns) upon no more than 31 days’ notice.
(n) Except as set forth on Schedule 5.01(n) annexed hereto, (i) there are no outstanding tenant improvement obligations (excluding maintenance or repair obligations that are ordinary operating expenses) or tenant improvement allowances or other credits, concessions or allowances due to any tenant under the Leases with respect to the current unexpired term thereof, and
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(ii) as of the date of this Agreement, none of the Major Tenants has vacated or abandoned its space and Owner has not received written notice from any Major Tenant of its intent to vacate or abandon its space.
(o) Except as set forth on Schedule 5.01(o) annexed hereto, (i) there are currently no capital improvement projects commenced by Owner or, to Owner’s knowledge, any tenant under any of the Leases, costing more than $50,000 in the aggregate at any of the Properties other than maintenance required in the ordinary course of business, (ii) as of the date of this Agreement, no material structural portion of any of the Properties has been damaged or destroyed by fire or other casualty that remains unrepaired, (iii) to Owner’s knowledge, there are no pending or threatened condemnation proceedings or any proceeding to re-zone all or any material portion of any of the Properties or any material means of ingress and egress to any of the Properties, and (iv) no tenant nor any other party has any options, rights of first refusal or rights of first offer to purchase all or any portion of any of the Properties.
(p) Other than Permitted Exceptions, the Leases, the Ground Leases, the Brokerage Agreements and the Service Contracts, there are no other agreements, written or oral, in force or effect, to which Owner is a party for which the Company will be bound or to which any of the Properties are subject.
(q) As of the date hereof, Owner maintains environmental insurance policies that provide coverage with respect to all of the Properties, a list of which policies is set forth on Schedule 5.01(q) (the “ Existing Environmental Policies “). Except as disclosed in the reports listed on Schedule 5.01(q) annexed hereto (copies of which have been delivered to or made available to the Company) and/or any other environmental report or update thereto obtained by the Company from a third party engineer or consultant prior to the Closing Date (the “ Environmental Reports “), or as otherwise noted on Schedule 5.01(q) , to Owner’s knowledge, (i) there are no underground storage tanks situated at any of the Properties and any such tanks removed or closed by Owner at any of the Properties has been done in compliance with any environmental laws and regulations, (ii) there have been no releases, emissions, discharges or disposals of any reportable quantities of hazardous materials, hazardous substances, contaminants or pollutants at or from any of the Properties in violation of any U.S. Federal or state environmental laws or regulations applicable to the Properties that have not been remediated in compliance with applicable laws, (iii) Owner has not received any written notification (which remains outstanding from any Governmental Authority having jurisdiction over the Properties) (A) stating that any hazardous materials, hazardous substances, contaminants or pollutants have been stored, generated, disposed of, released or transported at, on or from the Properties in violation of any environmental laws or regulations applicable to the Properties, and there is no claim pending against Owner with respect to any such violation applicable to the Properties, or (B) with respect to any corrective or remedial action or cleanup currently on-going or awaiting final governmental approval or no further action letters of any of the Properties or portions thereof, and (iv) the Properties have not been used for the production or generation of hazardous materials, hazardous substances, contaminants or pollutants, in a manner reasonably likely to result in liability under environmental laws and regulations applicable to the Properties, and there is no friable, damaged asbestos at any of the Properties.
(r) Schedule 5.01(r) annexed hereto is a true, correct and complete list of all insurance policies presently in effect with respect to the Properties, together with minimum coverages and amounts obtained and maintained by Owner and the premiums for all such insurance policies have been paid in full through the date hereof. Owner has received no written notice from any insurance carrier and has no knowledge of any defects or inadequacies in any of the Properties that, if not corrected, would result in a termination of insurance coverage or increase in the present cost thereof. To Owner’s knowledge, all insurance policies listed on Schedule 5.01(r) are in full force and effect and, except as set
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forth on Schedule 5.01(r) , either the policies or proceeds thereunder are fully transferable to the Company.
(s) Owner does not have any employees located at the Properties or employees located elsewhere whose duties are primarily with respect to the Properties and there are no (i) pension plan liabilities, funded or unfunded, (ii) employee benefit plan(s), programs, agreements, or arrangements of any kind (an “ Employee Plan “), or (iii) collective bargaining agreements or other agreement or understanding with any labor union, in each case, relating to any of the Properties. Owner is not involved in any labor or union controversy of any kind related to the Properties or that would be binding upon the Company upon the Closing. On and after the Closing, the Company shall not be obligated to employ or continue to employ any employees and the Company shall not assume and will not have any liabilities or obligations of any kind with respect to any employees or any Employee Plan, or any other collective bargaining agreement, employee benefit plan or arrangement maintained by Owner. The individuals currently employed on-site at the Properties on behalf of Owner are employees of New Plan Excel Realty Trust, Inc. or one of its Affiliates. After the Closing, such individuals shall be employed by ERT Australian Management, L.P.
(t) Owner is not a “foreign person” as defined in Section 1445 of the Code.
(u) Except as set forth on Schedule 5.01(u) annexed hereto, there is no litigation, action, claim, suit, investigation, arbitration or other adversarial contest or proceeding pending or, to Owner’s knowledge, threatened, against (i) Owner (or any Entity Owner) with respect to any of the Properties or relating to any of the Ground Leases or the Leases or (ii) any Entity Owner in which the ownership interests are transferred to the Company (or an SPE Entity) in lieu of a transfer of the Property owned by such Entity Owner (other than, in the case of (i) and (ii), claims for personal injury, bodily injury or property damage which are reasonably believed by Owner to be covered by Owner’s existing insurance policies).
(v) With respect to the Properties, to Owner’s knowledge, Owner is not in violation of any material law, regulation, order or decree (including zoning laws) of any Governmental Authority, court order, decision, ruling, order or award of any arbitration. To Owner’s knowledge, except as set forth on Schedule 5.01(q) or Schedule 5.01(v) annexed hereto, with respect to the Properties, Owner has not received any notice of violation or claimed violation of any such law, regulation or decree, or pending regulatory proceeding, action or investigation with respect thereto, or any threat by any Governmental Authority to take regulatory action against Owner or any of the Properties by reason of any such violation or claimed violation. Except as set forth on Schedule 5.01(v) , with respect to the Properties, to Owner’s knowledge, Owner has all material permits, licenses, certificates of occupancy and other approvals required of Owner to continue the existing operation of the Properties. “ Governmental Authority “ shall mean any federal, state or local government (whether domestic or foreign) or any agency, bureau, authority, body, commission, court, department, official, political subdivision, tribunal or other instrumentality of any government, whether federal, state or local, domestic or foreign.
(w) To Owner’s knowledge, except as set forth on Schedule 5.01(q) , Schedule 5.01(v) or Schedule 5.01(w) annexed hereto, with respect to the Properties, Owner has not received any written or, other actual notice within the past twelve (12) months from any Governmental Authority having jurisdiction over Owner of any violation of any employment or other regulatory law, order, regulation or requirement relating to the management of the Properties that remains uncured.
(x) Except as set forth in Schedule 5.01(x) annexed hereto, to Owner’s knowledge, Owner is not infringing upon any intellectual property rights of any other person or entity and no other person or entity is infringing on any of Owner’s rights in respect of the intellectual property
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owned and used by Owner, if any, with respect to the ownership, operation, management and maintenance of the Properties.
(y) True, correct and complete financial statements for Owner and the Properties as of and for the year ended December 31, 2004, and as of and for the three-month period ended March 31, 2005, were previously made available to the Company or its Agents, and to Owner’s knowledge, such financial statements were prepared in accordance with generally accepted accounting principles, consistently applied, and fairly present in all material respects and in accordance with applicable accounting principles the financial position and results of operations of Owner at or as of the date or period specified therein. Since March 31, 2005, Owner has conducted its business in the ordinary course consistent in all material respects with past practice.
(z) Except as set forth in Schedule 5.01(z) annexed hereto, there is not now pending, and Owner agrees that it will not, without the prior written consent of the Company (if such consent would be required under the terms of the Services Agreement), not to be unreasonably withheld, conditioned or delayed, institute prior to the Closing Date, any proceeding or application for a reduction in the real estate tax assessment of the Property or any other relief for any tax year unless such taxes are being contested in good faith and either the taxes being so contested have been paid in full if so required by the applicable taxing authority or adequate reserves for the payment of such taxes have been established by Owner which in such instance shall not require the Company’s consent. If Owner receives any payment of a rebate of taxes in its favor, Owner will remit to any tenant of the Properties all or any portion of such rebated sums which is owed to such tenant. Except as set forth in Schedule 5.01(z) , there are no outstanding agreements with attorneys or consultants with respect to the tax bills that will bind the Company and/or any SPE Entity (or the REIT) or the Properties after the Closing.
(aa) Upon the execution and delivery of the LLC Agreement by the Company and the Owner and the issuance of the Shares to Owner, Owner shall become subject to, and shall be bound by, the terms and provisions of the LLC Agreement, including the terms of the power of attorney contained in Article X thereof, as the LLC Agreement may be amended from time to time in accordance with its terms.
(bb) Owner understands the risks of, and other considerations relating to, the purchase of the Shares. Owner, by reason of its business and financial experience, together with the business and financial experience of those persons, if any, retained by it to represent or advise it with respect to its investment in the Shares, (i) has such knowledge, sophistication and experience in financial and business matters and in making investment decisions of this type that it is capable of evaluating the merits and risks of an investment in the Company and of making an informed investment decision, (ii) is capable of protecting its own interest or has engaged representatives or advisors to assist it in protecting its interests and (iii) is capable of bearing the economic risk of such investment.
(cc) Owner understands that an investment in the Company involves substantial risks. Owner has been given the opportunity to make a thorough investigation of the proposed activities of the Company and has been furnished with materials relating to the Company and its proposed activities. Owner has been afforded the opportunity to obtain any additional information deemed necessary by Owner to verify the accuracy of any representations made or information conveyed to Owner. Owner confirms that all documents, records, and books pertaining to its investment in the Company and requested by Owner have been made available or delivered to such Owner. Owner has had an opportunity to ask questions of and receive answers from the Company, or from a person or persons acting on the Company’s behalf, concerning the terms and conditions of this investment.
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(dd) The Shares to be issued to Owner will be acquired by Owner for its own account for investment only and not with a view to, or with any intention of, a distribution or resale thereof, in whole or in part, or the grant of any participation therein, without prejudice, however, to Owner’s right (subject to the terms of the Shares) at all times to sell or otherwise dispose of all or any part of its Shares under an exemption from such registration available under the Securities Act of 1933, as amended (the “ Securities Act “), and applicable state securities laws, and subject, nevertheless, to the disposition of its assets being at all times within its control. Owner was not formed for the specific purpose of acquiring an interest in the Company.
(ee) Owner acknowledges that, except as expressly set forth in this Agreement or in the LLC Agreement, (i) the Shares to be issued to Owner have not been registered under the Securities Act or state securities laws by reason of a specific exemption or exemptions from registration under the Securities Act and applicable state securities laws and, if such Shares are represented by certificates, such certificates will bear a legend to such effect, (ii) the Company’s reliance on such exemptions is predicated in part on the accuracy and completeness of the representations and warranties of Owner contained herein, (iii) such Shares, therefore, cannot be resold unless registered under the Securities Act and applicable state securities laws, or unless an exemption from registration is available, (iv) there is no public market for such Shares, and (v) the Company has no obligation or intention to register such Shares for resale under the Securities Act or any state securities laws or to take any action that would make available any exemption from the registration requirements of such laws. Owner hereby acknowledges that because of the restrictions on transfer or assignment of such Shares to be issued hereunder which will be set forth in the LLC Agreement and/or in a registration rights agreement, such Owner may have to bear the economic risk of the investment commitment evidenced by this Agreement and any Shares acquired hereby for an indefinite period of time.
(ff) Each Entity Owner has prepared and timely filed all tax returns required to be filed on or before the date hereof with respect to the Properties, which tax returns are true, correct and complete in all material respects. Each Entity Owner has paid or made provision for the payment of all taxes with respect to the ownership and operation of the Properties that are due or claimed to be due from it on or before the date hereof by any governmental taxing authority. No federal, state, local or foreign taxing authority has given written notice to any Entity Owner of any tax deficiency, lien, interest or penalty or other assessment against any Entity Owner which has not been paid and no audit or written inquiry has been commenced or, to the best of Owner’s knowledge, threatened by any federal, state, local or foreign tax authority relating any Entity Owner that may be expected to result in a tax deficiency, lien, interest or other assessment against the assets of such Entity Owner. Owner shall pay any and all taxes imposed on the Company based on Owner’s failure to comply with any bulk sales law.
(gg) Schedule 7.08 is a true, correct and complete list of all Required Owner Consents.
(hh) The Review Materials delivered to, or made available for inspection by, the Company are true, correct and complete copies.
5.02. The Company represents and warrants to Owner as follows:(a) The Company is a limited liability company, organized, existing and in good standing under the laws of the State of Delaware, and has the requisite power and authority to enter into and perform the terms of this Agreement, including to issue the Shares to Owner to the extent called for in accordance with the terms of this Agreement.
15 (b) The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby on the part of the Company have been duly authorized by all necessary limited liability company action and no other proceedings on the part of the Company are necessary in order to permit it to consummate the transactions contemplated hereby.(c) This Agreement has been duly executed by the Company and all of the Company’s obligations hereunder are the legal, valid and binding obligations of the Company, enforceable in accordance with the terms of this Agreement, subject to applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and other similar laws relating to or affecting creditors’ rights generally from time to time in effect and to general principles of equity (including concepts of materiality, reasonableness, good faith and fair dealing), regardless whether considered in a proceeding in equity or at law.(d) Except as set forth on Schedule 10.02 annexed hereto, the Company’s performance of its duties under this Agreement will not conflict with, result in a breach of or be a default under, or be adversely affected by, any existing agreements, instruments, judgments, permits, orders, rules, regulations or decrees to which the Company is a party or by which it or its assets are bound.(e) The Company is not the subject of any bankruptcy, reorganization, insolvency or similar proceedings.(f) The Shares to be issued in connection with the transactions contemplated herein will be duly authorized and validly issued in accordance with the terms of the LLC Agreement and, assuming the accuracy of Owner’s representations and warranties, in compliance with federal and applicable state securities laws, and will be, in connection with the transactions contemplated herein, fully paid and non-assessable with no preemptive rights, and the Shares to be issued in connection with the transactions contemplated herein will be issued upon the terms provided in the LLC Agreement, as the same is to be amended as permitted or required hereunder. Except as created by this Agreement, as of the date hereof, there are no outstanding subscriptions, options, warrants, preemptive or other rights or other arrangements or commitments obligating the Company to issue any Shares. At the Closing, upon receipt by Owner of the Contribution Consideration and the cash, if any, required to be contributed by Owner pursuant to Section 3.04 in exchange for Shares, the Company will issue the Shares to be issued hereunder free and clear of all liens other than those suffered or permitted or granted by Owner and, as of the Closing, such Owner will be admitted as a member of the Company. The issuance of the Shares to Owner at the Closing will not require any approval or consent of any person except any such approval as shall have been obtained on or prior to the Closing Date.5.03. The REIT represents and warrants to Owner as follows:(a) The REIT is a corporation, organized, existing and in good standing under the laws of the State of Maryland and has the requisite power and authority to enter into and perform the terms of this Agreement.(b) The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby on the part of the REIT have been duly authorized by all necessary limited liability company action and no other proceedings on the part of the REIT are necessary in order to permit it to consummate the transactions contemplated hereby.(c) This Agreement has been duly executed by the REIT and all of the REIT’s obligations hereunder are the legal, valid and binding obligations of the REIT, enforceable in accordance with the terms of this Agreement, subject to applicable bankruptcy, insolvency,
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reorganization, moratorium, fraudulent transfer and other similar laws relating to or affecting creditors’ rights generally from time to time in effect and to general principles of equity (including concepts of materiality, reasonableness, good faith and fair dealing), regardless whether considered in a proceeding in equity or at law.(d) The REIT’s performance of its duties under this Agreement will not conflict with, result in a breach of or be a default under, or be adversely affected by, any existing agreements, instruments, judgments, permits, orders, rules, regulations or decrees to which the REIT is a party or by which it or its assets are bound.(e) The REIT is not the subject of any bankruptcy, reorganization, insolvency or similar proceedings.(f) Subject to obtaining the Required Company Consents, the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby on the part of (i) the Company have been duly authorized by all necessary limited liability company action, (ii) the REIT have been duly authorized by all necessary corporate action, (iii) the Advisor have been duly authorized by all necessary limited liability company action and (iv) the A-LPT have been duly authorized by all necessary action, as applicable, and no other proceedings or consents are necessary in order to permit such Person to consummate the transactions contemplated hereby. Neither the consent nor the approval of the unitholders of the A-LPT is required in connection with (x) the execution and delivery of this Agreement by the Company and the REIT or (y) the consummation of the transactions contemplated hereby by the Company, the REIT, the Advisor and/or the A-LPT.(g) True, correct and complete financial statements for the Company as of and for the year ended December 31, 2004, and as of and for the three-month period ended March 31, 2005 (collectively, the “ Company Financial Statements “), were previously made available to Owner, and such financial statements have been prepared in accordance with generally accepted accounting principles applied on a consistent basis (except as may be indicated therein or in the notes thereto) and present fairly, in all material respects, the consolidated financial position of the Company and its subsidiaries as at the dates thereof and the consolidated results of their operations and cash flow for the periods then ended subject, in the case of the unaudited interim financial statements, to normal year-end audit adjustments and any other adjustments described therein. Since March 31, 2005, the Company has conducted its business in the ordinary course consistent in all material respects with past practice. Since March 31, 2005, except as disclosed in the Galileo Filings |
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