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EXHIBIT 10.41
CONTRIBUTION AGREEMENT
(THE ATRIUM BUILDING)
BY AND BETWEEN
THE OLIVER CARR COMPANY
A DISTRICT OF COLUMBIA CORPORATION,
AS CONTRIBUTOR
AND
COLUMBIA EQUITY, LP,
A VIRGINIA LIMITED PARTNERSHIP,
AS ACQUIRER
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TABLE OF CONTENTS
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ARTICLE I THE
CONTRIBUTION.............................................................
1
1.1
Contribution of Membership
Interest................................. 1
1.2
Consideration.......................................................
1
1.3
Redemption Rights for
Units......................................... 2
1.4
Tax Consequences to
Contributor..................................... 2
ARTICLE II REPRESENTATIONS AND
COVENANTS...............................................
2
2.1
Representations by
Acquirer......................................... 2
2.2
Representations by
Contributor...................................... 4
2.3
Covenants of
Acquirer...............................................
6
2.4
Covenants of
Contributor............................................
6
ARTICLE III Conditions Precedent to the
Closing........................................ 7
3.1
Conditions to Acquirer's
Obligations................................ 7
3.2
Conditions to Contributor's
Obligations............................. 7
ARTICLE IV Closing and Closing
Documents...............................................
8
4.1
Closing.............................................................
8
4.2
Contributor's
Deliveries............................................ 8
4.3
Acquirer'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.............................................. 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..................................................... 11
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EXHIBITS
A
Assignment and Assumption Agreement
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CONTRIBUTION AGREEMENT
THIS
CONTRIBUTION AGREEMENT (this "Agreement") is made as of this 31st
day
of January, 2005 by and between The Oliver
Carr Company, a District of Columbia
corporation ("Contributor"); and Columbia
Equity, LP, a Virginia limited
partnership ("Acquirer").
RECITALS
A. Atrium
Building, LLC, a Virginia limited liability company (the "LLC")
is the owner of certain land located at 277
S. Washington Street in Alexandria,
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
Atrium Building.
B. Carr
Capital Atrium, LLC, a Virginia limited liability company
("Carr
Atrium") is the record and beneficial owner
of Fifteen and 00/100 percent (15%)
of the membership interests in the LLC.
C.
Contributor is the record and beneficial owner of Six and
67/100
percent (6.67%) of the membership interests
in Carr Atrium (the "Membership
Interest").
D.
Contributor desires to contribute the Membership Interest to
Acquirer,
on the terms and conditions hereinafter set
forth.
E.
Acquirer desires to acquire the Membership Interest from
Contributor,
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 CONTRIBUTION
1.1
Contribution of Membership Interest. Contributor agrees to
contribute,
transfer, assign and convey the Membership
Interest to Acquirer, and Acquirer
agrees to acquire 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 Acquirer 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
Carr Atrium's operating agreement (the
"Carr Atrium Operating Agreement")).
1.2
Consideration. The total consideration (the "Consideration") for
which
Contributor agrees to contribute and assign
the Membership Interest to Acquirer,
and which Acquirer agrees to pay or deliver
to Contributor, subject to the terms
of this Agreement, shall be the issuance to
Contributor of a number of units of
limited partnership interests in
Acquirer
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("Units") equal to (a) a value of the
Membership Interest providing the
Contributor with a fourteen percent (14%)
IRR (as defined in the LLC's operating
agreement), based on a minimum of a six
month investment holding period for
Seller's Capital Contribution (as defined
in Carr Atrium Operating Agreement),
(b) divided by the price per share at which
the common stock, $.01 par value per
share, (the "Common Stock") of Columbia
Equity Trust, Inc., a Maryland
corporation and the general partner of
Acquirer (the "REIT"), is offered to the
public in the underwritten initial public
offering of the Common Stock (the
"IPO"). On the Closing Date (as defined
below), the Units shall be issued to
Contributor. Upon the request of
Contributor, Acquirer shall issue certificates
reflecting Contributor's ownership of
Units. The certificates evidencing the
Units will bear appropriate legends
indicating (i) that the Units have not been
registered under the Securities Act of
1933, as amended ("Securities Act"), and
(ii) that Acquirer's Amended and Restated
Agreement of Limited Partnership (the
"Partnership Agreement") restricts the
transfer of the Units. Upon receipt of
the Units and execution and delivery of the
Partnership Agreement, Contributor
shall become a limited partner of
Acquirer.
1.3
Redemption Rights for Units. Each Unit shall be redeemable, at
the
option of the holder, in accordance with,
but subject to the restrictions
contained in, the Partnership Agreement;
provided, however, that such redemption
option may not be exercised prior to the
first anniversary of the Closing Date.
1.4 Tax
Consequences to Contributor. Notwithstanding anything to the
contrary contained in this Agreement,
including without limitation the use of
words and phrases such as "sell," "sale,"
purchase," and "pay," the parties
hereto acknowledge and agree that it is
their intent that the transaction
contemplated hereby be treated for federal
income tax purposes as the
contribution of the Membership Interest by
Contributor to Acquirer in exchange
for Units pursuant to Section 721 of the
Internal Revenue Code of 1986, as
amended (the "Code"), and not as a
transaction in which Contributor is acting
other than in its capacity as a prospective
partner of Acquirer.
ARTICLE II
REPRESENTATIONS AND COVENANTS
2.1
Representations by Acquirer. Acquirer hereby represents and
warrants
unto Contributor 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. Acquirer is duly organized and validly
existing, 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 Acquirer
of its obligations under this
Agreement have been duly authorized by all
requisite action of Acquirer and
require no further action or approval of
Acquirer's partners or of any other
individuals or entities in order to
constitute this Agreement as a binding and
enforceable obligation of Acquirer.
(b) Noncontravention. Neither the entry into nor the performance
of,
or compliance with, this Agreement by
Acquirer has resulted, or will result, in
any violation of, or
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default under, or result in the
acceleration of, any obligation under the
Partnership Agreement, or any mortgage,
indenture, lien agreement, note,
contract, permit, judgment, decree, order,
restrictive covenant, statute, rule,
or regulation applicable to Acquirer.
(c)
Litigation. There is no action, suit, or proceeding, pending or
known
to be threatened, against or affecting
Acquirer 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 Acquirer, or (iii)
would reasonably be expected to materially
and adversely affect the ability of
Acquirer to perform its obligations
hereunder, or under any document to be
delivered pursuant hereto.
(d) Units
Validly Issued. The Units, when issued, will have been duly and
validly authorized and issued, free of any
preemptive or similar rights, and
will be fully paid and nonassessable,
without any obligation to restore capital
except as required by the Virginia Revised
Uniform Limited Partnership Act (the
"Limited Partnership Act"). Upon execution
and delivery of the Partnership
Agreement by Contributor, Contributor shall
be admitted as a limited partner of
Acquirer as of the Closing Date and shall
be entitled to all of the rights and
protections of a limited partner under the
Limited Partnership Act and the
provisions of the Partnership Agreement,
with the same rights, preferences, and
privileges as all other limited partners on
a pari passu basis.
(e)
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
Acquirer has been obtained.
(f)
Bankruptcy with respect to Acquirer. No Act of Bankruptcy has
occurred
with respect to Acquirer. 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.
(g)
Brokerage Commission. Acquirer has not engaged the services of,
nor
has it or will it or Contributor 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 Acquirer. Acquirer
hereby agrees to indemnify and hold
Contributor and its employees, directors,
members, partners, affiliates and
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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 Contributor. Contributor hereby represents
and
warrants unto Acquirer 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. Contributor is duly incorporated,
validly existing, and in good standing as a
District of Columbia corporation.
Contributor 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 Contributor of its
obligations hereunder have been duly
authorized by all requisite action of
Contributor and require no further action
or approval of Contributor's officers
or directors or of any other individuals or
entities in order to constitute this
Agreement as a binding and enforceable
obligation of Contributor.
(b) Noncontravention. Neither the entry into nor the performance
of,
or compliance with, this Agreement by
Contributor has resulted, or will result,
in any violation of, or default under, or
result in the acceleration of, any
obligation under any bylaws, regulation,
mortgage, indenture, lien agreement,
note, contract, permit, judgment, decree,
order, restrictive covenant, statute,
rule, or regulation applicable to
Contributor or to the Membership Interest.
(c) Litigation. There is no action, suit, claim, or proceeding
pending or threatened against or affecting
Contributor 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 Contributor, (C) would
reasonably be expected to materially and
adversely affect the ability of Contributor
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) Contributor 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 Carr
Atrium 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 secur
