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EXHIBIT 10.4
MEMBERSHIP INTEREST SALE AGREEMENT
BY AND BETWEEN
HOLUALOA GREENBRIAR, LLC,
AN ARIZONA 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.......................................................................................
1
1.1 Sale of Membership
Interest...................................................................
1
1.2 Purchase
Price................................................................................
2
ARTICLE II REPRESENTATIONS AND
COVENANTS.................................................................
2
2.1 Representations by
Purchaser..................................................................
2
2.2 Representations by
Seller.....................................................................
3
2.3 Covenants of
Purchaser........................................................................
4
2.4 Covenants of
Seller...........................................................................
5
ARTICLE III Conditions Precedent to the
Closing..........................................................
6
3.1 Conditions to
Purchaser's
Obligations.........................................................
6
3.2 Conditions to Seller's
Obligations............................................................
6
ARTICLE IV Closing and Closing
Documents.................................................................
7
4.1
Closing.......................................................................................
7
4.2 Seller's
Deliveries...........................................................................
7
4.3 Purchaser's
Deliveries........................................................................
8
4.4 Fees and Expenses;
Closing
Costs..............................................................
8
4.5
Adjustments...................................................................................
8
ARTICLE V
Miscellaneous..................................................................................
9
5.1
Notices......................................................................................
9
5.2 Entire Agreement;
Modifications and Waivers; Cumulative
Remedies.............................
10
5.3
Exhibits.....................................................................................
11
5.4 Successors and
Assigns.......................................................................
11
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..............................................................................
12
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EXHIBITS
A
Assignment
<PAGE>
MEMBERSHIP INTEREST SALE AGREEMENT
THIS
MEMBERSHIP INTEREST SALE AGREEMENT (this "Agreement") is made as
of
this 12th day of October, 2004 by and
between Holualoa Greenbriar, LLC, an
Arizona limited liability company
("Seller"); and Columbia Equity, LP, a
Virginia limited partnership
("Purchaser").
RECITALS
A.
Carr
Capital Greenbriar, LLC, a Virginia limited liability company
(the "LLC") is the owner of certain land
located in Fairfax County, 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 Greenbriar
office building.
B.
Carr
Capital/Holualoa Greenbriar, LLC, a Virginia limited liability
company (the "Liquidating LLC") is the
record and beneficial owner of Sixteen
and 32/100 percent (16.32%) of the
membership interests in the LLC.
C.
Seller is
the record and beneficial owner of ninety-six and 79/100
percent (96.77%) of the membership
interests in the Liquidating LLC.
D.
The
members of the Liquidating LLC, Seller and Carr Capital Real
Estate Investments, LLC, a Virginia limited
liability company, ("Carr" and
collectively with Seller, the "Liquidating
LLC Members") intend to liquidate the
Liquidating LLC and each of the Liquidating
LLC Members, shall be admitted as
members of the LLC, with Seller receiving a
Fifteen and 79/100 percent (15.79%)
("Seller's Share") membership interest in
the LLC (the "Membership Interest")
and Carr receiving a 53/100 percent (.53%)
membership interest in the LLC (the
"Liquidation Transaction"). 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,
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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 the amount of Net Cash Flow (as
such term is defined in the LLC
Operating Agreement) that Seller would be
entitled to receive pursuant to
Section 3.1 of the LLC Operating Agreement
upon a hypothetical sale of the
Property for a sale price of Fifteen
Million Three Hundred Thousand Dollars
($15,300,000) less the principal of and
accrued interest on the mortgage loan
secured by the Property ("Mortgage
Loan").
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 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.
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(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,
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 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 Arizona. 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. Neither the entry into nor the performance
of, or compliance with, this Agreement by
Seller has resulted, or will result,
in any violation of, or default under, or
result in the acceleration of, any
obligation under any 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 Membership
Interest.
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(c) Litigation.
There is no action, suit, claim, or proceeding
pending or threatened against or affecting
Seller, its membership interest in
the Liquidating LLC or 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) in
any manner raises any question affecting
the validity or enforceability of this
Agreement, (B) would reasonably be expected
to materially and adversely affect
the business, financial position or results
of operations of Seller, (C) 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, (D) would reasonably be
expected to create a lien on the
Membership Interest, any part thereof, or
any interest therein, or (E) would
reasonably be expected to adversely affect
the Membership Interest, any part
thereof, or any interest therein.
(d) Good Title.
(A) Seller has good title to its membership
interest in the Liquidating LLC on the date
hereof and will have good title to
the Membership Interest on the Closing Date
(other than the LLC Operating
Agreement), (B) its membership interest in
the Liquidating LLC on the date
hereof is and the Membership Interest on
the Closing Date will be free and clear
of all liens, encumbrances, pledges, voting
agreements and security interests
whatsoever (other than the LLC Operating
Agreement), and (C) Seller has not
granted any other person or entity an
option to purchase or a right of first
refusal upon its membership interest in the
Liquidating LLC or in the Membership
Interest nor are there any agreements or
understandings between Seller and any
other person or entity with respect to the
disposition of its membership
interest in the Liquidating LLC or in the
Membership Interest (other than the
LLC Operating Agreement).
(e) No Consents.
Each consent, approval, authorization, order,
license, certificate, permit, registration,
designation, or filing by or with,
any governmental agency or body necessary
o
