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EXHIBIT 10.10
MEMBERSHIP INTEREST SALE AGREEMENT
BY AND BETWEEN
CLARK/CARR INVESTMENTS, LLC,
A MARYLAND LIMITED LIABILITY COMPANY,
AS SELLER
AND
COLUMBIA EQUITY, LP,
A VIRGINIA LIMITED PARTNERSHIP,
AS PURCHASER
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TABLE OF CONTENTS
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ARTICLE I THE
SALE........................................................................
3
1.1 Sale of
Membership Interest...............................................
3
1.2 Purchase
Price............................................................
3
ARTICLE II REPRESENTATIONS AND
COVENANTS..................................................
4
2.1
Representations by
Purchaser..............................................
4
2.2
Representations by
Seller.................................................
5
2.3 Covenants
of Purchaser....................................................
6
2.4 Covenants
of Seller.......................................................
6
ARTICLE III CONDITIONS PRECEDENT TO THE
CLOSING...........................................
7
3.1 Conditions
to Purchaser's Obligations.....................................
7
3.2 Conditions
to Seller's Obligations........................................
7
ARTICLE IV CLOSING AND CLOSING
DOCUMENTS..................................................
8
4.1
Closing...................................................................
8
4.2 Seller's
Deliveries.......................................................
8
4.3
Purchaser's
Deliveries....................................................
9
4.4 Fees and
Expenses; Closing Costs..........................................
9
4.5
Adjustments...............................................................
9
ARTICLE V
MISCELLANEOUS...................................................................
9
5.1
Notices...................................................................
9
5.2 Entire
Agreement; Modifications and Waivers; Cumulative Remedies..........
10
5.3
Exhibits..................................................................
10
5.4 Successors
and Assigns....................................................
10
5.5 Article
Headings..........................................................
11
5.6 Governing
Law.............................................................
11
5.7
Counterparts..............................................................
11
5.8
Survival..................................................................
11
5.9
Severability..............................................................
11
5.10
Attorneys'
Fees...........................................................
11
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EXHIBITS
A
Assignment and Assumption Agreement
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MEMBERSHIP INTEREST SALE AGREEMENT
THIS
MEMBERSHIP INTEREST SALE AGREEMENT (this "Agreement") is made as
of
this 31st day of January, 2005 by and
between Clark/Carr Investments, LLC, a
Maryland limited liability company
("Seller"); and Columbia Equity, LP, a
Virginia limited partnership
("Purchaser").
RECITALS
A. Meadows
IV, LLC, a Virginia limited liability company (the "LLC") is
the owner of certain land located in
Chantilly, Virginia (the "Land") and the
office building and related improvements
located thereon (the "Improvements"),
which Land and Improvements (collectively,
the "Property") are more commonly
known as the Meadows IV Building.
B. Meadows
IV Investors, LLC, a Virginia limited liability company
("Meadows IV Investors") is the direct and
indirect owner of One Hundred and
00/100 percent (100.00%) of the membership
interests in the LLC.
C. Seller
is the record and beneficial owner of Forty-Three and 60/100
percent (43.60%) of the membership
interests in Meadows IV Investors (the
"Membership Interest").
D. Seller
desires to sell the Membership Interest to Purchaser, on the
terms and conditions hereinafter set
forth.
E.
Purchaser desires to purchase the Membership Interest from Seller,
on
the terms and conditions hereinafter set
forth.
AGREEMENT
NOW,
THEREFORE, for and in consideration of the mutual covenants
herein
contained, the parties hereto agree as
follows:
ARTICLE I
THE SALE
1.1 Sale
of Membership Interest. Seller agrees to sell, transfer, assign
and convey the Membership Interest to
Purchaser, and Purchaser agrees to
purchase and accept transfer of the
Membership Interest pursuant to the terms
and conditions set forth in this Agreement.
The Membership Interest shall be
transferred to Purchaser free and clear of
all liens, encumbrances, security
interests, prior assignments or
conveyances, conditions, restrictions, voting
agreements, claims, and any other matters
affecting title thereto (other than
the LLC's Operating Agreement (the "LLC
Operating Agreement")).
1.2
Purchase Price. The purchase price (the "Purchase Price") for
which
Seller agrees to sell and assign the
Membership Interest to Purchaser, and which
Purchaser agrees to pay to Seller, subject
to the terms of this Agreement, shall
be equal to an amount providing the Seller
with a twenty percent (20%) IRR (as
defined in Meadows IV Investors' Operating
Agreement (the "Meadows IV Investors
Operating Agreement")), based on a minimum
of a six month investment holding
period for Seller's Capital Contribution
(as defined in the Meadows IV
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Investors Operating Agreement) (that is,
based on initial Capital Contribution
of $2,212,500, assuming no distributions by
the Company, the minimum Purchase
Price would equal $2,443,176).
ARTICLE II
REPRESENTATIONS AND COVENANTS
2.1
Representations by Purchaser. Purchaser hereby represents and
warrants
to Seller that the following statements are
true, correct, and complete in every
material respect as of the date of this
Agreement and will be true, correct, and
complete as of the Closing Date:
(a) Organization and Power. Purchaser is duly organized and
validly
existing as a limited partnership under the
laws of the Commonwealth of
Virginia, and has full right, power, and
authority to enter into this Agreement
and to perform all of its obligations under
this Agreement; and, the execution
and delivery of this Agreement and the
performance by Purchaser of its
obligations under this Agreement have been
duly authorized by all requisite
action of Purchaser and require no further
action or approval of Purchaser's
partners or of any other individuals or
entities in order to constitute this
Agreement as a binding and enforceable
obligation of Purchaser.
(b) Noncontravention. Neither the entry into nor the performance
of,
or compliance with, this Agreement by
Purchaser has resulted, or will result, in
any violation of, or default under, or
result in the acceleration of, any
obligation under the partnership agreement
of Purchaser, or any mortgage,
indenture, lien agreement, note, contract,
permit, judgment, decree, order,
restrictive covenant, statute, rule, or
regulation applicable to Purchaser.
(c) Litigation. There is no action, suit, or proceeding, pending
or
known to be threatened, against or
affecting Purchaser in any court or before
any arbitrator or before any federal,
state, municipal, or other governmental
department, commission, board, bureau,
agency or instrumentality which (i) in
any manner raises any question affecting
the validity or enforceability of this
Agreement, (ii) would reasonably be
expected to materially and adversely affect
the business, financial position, or
results of operations of Purchaser, (iii)
would reasonably be expected to materially
and adversely affect the ability of
Purchaser to perform its obligations
hereunder, or under any document to be
delivered pursuant hereto.
(d) Consents. Each consent, approval, authorization, order,
license,
certificate, permit, registration,
designation, or filing by or with any
governmental agency or body necessary for
the execution, delivery, and
performance of this Agreement or the
transactions contemplated hereby by
Purchaser has been obtained.
(e) Bankruptcy with respect to Purchaser. No Act of Bankruptcy
has
occurred with respect to Purchaser. As used
herein, "Act of Bankruptcy" shall
mean if a party hereto shall (A) apply for
or consent to the appointment of, or
the taking of possession by, a receiver,
custodian, trustee or liquidator of
itself or of all or a substantial part of
its property, (B) admit in writing its
inability to pay its debts as they become
due, (C) make a general assignment for
the benefit of its creditors, (D) file a
voluntary petition or commence a
voluntary case or proceeding under the
Federal Bankruptcy Code (as now or
hereafter in effect), (E) be adjudicated
bankrupt or insolvent, (F) file a
petition seeking to take advantage of any
other law relating to bankruptcy,
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insolvency, reorganization, winding-up or
composition or adjustment of debts,
(G) fail to controvert in a timely and
appropriate manner, or acquiesce in
writing to, any petition filed against it
in an involuntary case or proceeding
under the Federal Bankruptcy Code (as now
or hereafter in effect), or (H) take
any action for the purpose of effecting any
of the foregoing.
(f) Brokerage Commission. Purchaser has not engaged the services
of,
nor has it or will it or Seller become
liable to, any real estate agent, broker,
finder or any other person or entity for
any brokerage or finder's fee,
commission or other amount with respect to
the transactions described herein on
account of any action by Purchaser.
Purchaser hereby agrees to indemnify and
hold Seller and its employees, directors,
members, partners, affiliates and
agents harmless against any actual claims,
liabilities, damages or expenses
arising out of a breach of the foregoing.
This indemnification shall survive
Closing or any termination of this
Agreement.
2.2
Representations by Seller. Seller hereby represents and warrants
unto
Purchaser that each and every one of the
following statements is true, correct,
and complete in every material respect as
of the date of this Agreement and will
be true, correct, and complete as of the
Closing Date:
(a) Organization and Power. Seller is duly organized, validly
existing, and in good standing as a limited
liability company under the laws of
the State of Maryland. Seller has full
right, power, and authority to enter into
this Agreement and to perform all of its
obligations under this Agreement; and
the execution and delivery of this
Agreement and the performance by Seller of
its obligations hereunder have been duly
authorized by all requisite action of
Seller and require no further action or
approval of Seller's members or managers
or of any other individuals or entities in
order to constitute this Agreement as
a binding and enforceable obligation of
Seller.
(b) Noncontravention. To Seller's actual knowledge, neither the
entry into nor the performance of, or
compliance with, this Agreement by Seller
has resulted, or will result, in any
material violation of, or material default
under, or result in the acceleration of,
any material obligation under any
material limited liability company
agreement, operating agreement, regulation,
mortgage, indenture, lien agreement, note,
contract, permit, judgment, decree,
order, restrictive covenant, statute, rule,
or regulation applicable to Seller
or, to the actual knowledge of Seller, to
the Membership Interest.
(c) Litigation. There is no action, suit, claim, or proceeding
pending or, to the actual knowledge of
Seller, threatened against Seller, or, to
the actual knowledge of Seller, the
Membership Interest in any court, or before
any arbitrator, or before any federal,
state, municipal or other governmental
department, commission, board, bureau,
agency or instrumentality which (A) would
reasonably be expected to materially and
adversely affect the ability of Seller
to perform its obligations hereunder, or
under any document to be delivered
pursuant hereto, (B) would reasonably be
expected to create a lien on the
Membership Interest, any part thereof, or
any interest therein, or (C) would
reasonably be expected to materially and
adversely affect the Membership
Interest, any part thereof, or any interest
therein.
(d) Good Title. (A) Seller has good title to the Membership
Interest
on the date hereof and will have good title
to the Membership Interest on the
Closing Date (other than the LLC Operating
Agreement), (B) the Membership
Interest on the date hereof is and on the
Closing Date will be free and clear of
all liens, encumbrances, pledges, voting
agreements and
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security interests whatsoever (other than
the LLC Operating Agreement), and (C)
Seller has
