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EXHIBIT 10.1
PURCHASE AND SALE AGREEMENT
BY AND BETWEEN
NASHUA CORPORATION
(SELLER)
AND
EQUITY INDUSTRIAL PARTNERS CORP. (BUYER)
DATED AS OF NOVEMBER 6, 2006
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TABLE OF CONTENTS
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PAGE
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ARTICLE 1 PURCHASE AND
SALE AGREEMENT................................... 6
1.1 Agreement to
Purchase and Sell................................ 6
1.2
Definitions...................................................
6
ARTICLE 2 THE
PROPERTY..................................................
8
2.1 Description of
the Property................................... 8
2.2
Lease-Back....................................................
8
ARTICLE 3 PURCHASE
PRICE; DEPOSIT; ADJUSTMENTS.......................... 9
3.1 Purchase
Price................................................ 9
3.2
Deposit.......................................................
9
3.3 Balance of
Purchase Price..................................... 9
3.4 Prorations of
Taxes........................................... 9
3.5 Prorations of
Contracts and Prepaid Expenses.................. 10
3.6
Utilities.....................................................
10
3.7 Rent
Prorations...............................................
10
3.8 Uncollected
Rents............................................. 10
3.9
Estimates.....................................................
11
3.10
Adjustment
Payments........................................... 11
3.11
Calculation of Prorations.....................................
11
3.12
Seller's
Closing Costs........................................ 11
3.13
Buyer's
Closing Costs......................................... 11
3.14
Closing
Statement............................................. 11
3.15
Survival......................................................
11
ARTICLE 4
REPRESENTATIONS, WARRANTIES, COVENANTS AND AGREEMENTS.........
12
4.1 Seller's
Representations and Warranties....................... 12
4.2 Seller's
Covenants............................................ 13
4.3 Buyer's
Representations and Warranties........................ 14
4.4 Hazardous
Materials Indemnities............................... 14
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ARTICLE 5 ACCESS,
INSPECTION, DILIGENCE................................. 15
5.1
Inspections...................................................
15
5.2 Property
Investigations....................................... 15
5.3
Disclosure....................................................
16
5.4
Indemnity/Insurance...........................................
16
5.5 Due Diligence
Materials....................................... 16
5.6 Inspection
Period............................................. 16
5.7 Extension of
Inspection Period................................ 17
ARTICLE 6 TITLE AND
SURVEY.............................................. 17
6.1 Title and Survey
Review....................................... 17
6.2 Title
Objection...............................................
17
6.3 Seller's Cure of
Title Objections............................. 17
6.4 Required State
of Title....................................... 17
6.5 Personal
Property............................................. 18
ARTICLE 7 CONDITIONS
TO SELLER'S AND BUYER'S PERFORMANCE................ 18
7.1 Conditions to
Seller's Obligations............................ 18
7.2 Conditions to
Buyer's Obligations............................. 18
ARTICLE 8
CLOSING.......................................................
19
8.1
Closing.......................................................
19
8.2 Seller's Closing
Deliveries................................... 19
8.3 Buyer's Closing
Deliveries.................................... 20
8.4 Delivery of
Deposit........................................... 21
ARTICLE 9 CASUALTY AND
CONDEMNATION..................................... 21
9.1 Damage or
Destruction/Eminent Domain.......................... 21
9.2 Major
Casualty................................................
21
9.3 Material
Condemnation......................................... 22
ARTICLE 10 BROKERAGE
COMMISSIONS......................................... 22
10.1 Representations and
Indemnity................................. 22
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ARTICLE 11 DEFAULT, TERMINATION AND
REMEDIES............................. 22
11.1
Seller
Default................................................
22
11.2
Buyer
Default.................................................
23
ARTICLE 12
MISCELLANEOUS.................................................
23
12.1
Assignment....................................................
23
12.2
Notices.......................................................
24
12.3
Interpretation................................................
25
12.4
Captions......................................................
25
12.5
No
Third-Party Beneficiaries..................................
25
12.6
Amendments....................................................
25
12.7
Integration...................................................
25
12.8
Choice of
Law................................................. 25
12.9
Counterparts..................................................
25
12.10
Business
Day.................................................. 26
12.11
Time of the
Essence........................................... 26
12.13
Use of Proceeds
to Clear Title................................ 26
12.14
Submission not
an Offer or Option............................. 26
ARTICLE 13 IRS FORM 1099-S
DESIGNATION................................... 26
13.1
Designee......................................................
26
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SCHEDULES
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SCHEDULE 2.1(a)
Description of the Real Property
SCHEDULE 2.1(g)
Leases
SCHEDULE 2.1(e)
Description of Personal Property
SCHEDULE 2.1(f)
Description of Intangible Property
SCHEDULE 2.2 Nashua
Lease
SCHEDULE 2.2(A)
Collateral Access Agreement
SCHEDULE 3.2 Form of
Deposit Escrow Agreement
SCHEDULE 4.1(b)
List of Legal Proceedings
SCHEDULE 4.1(f)
List of Contracts
SCHEDULE 4.2(f)
Form of Tenant Estoppel Certificate
SCHEDULE 4.2(h)
Form of Post-Closing Remediation Agreement
SCHEDULE 5.1 Access and
Indemnity Agreement dated August 1, 2006
SCHEDULE 5.5 Due
Diligence Materials
SCHEDULE 5.5(a)
List of Additional Environmental Reports
SCHEDULE 8.1 Form of
Escrow Closing Instructions
SCHEDULE 8.2(a)
Form of Warranty Deed
SCHEDULE 8.2(b)
Form of Bill of Sale and General Assignment
SCHEDULE 8.2(c)
Form of Assignment of Leases
SCHEDULE 8.2(d)
Form of Assignment and Assumption of Contracts
SCHEDULE 8.2(h)
Form of FIRPTA Affidavit
SCHEDULE 8.2(j)
Form of Tenant Notice Letter
SCHEDULE 13.1 Form of IRS Form
1099-S
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PURCHASE AND SALE AGREEMENT
This Purchase and Sale Agreement (this "Agreement") is entered into
as of the
sixth day of November, 2006 by and between Nashua Corporation, a
Massachusetts
corporation (the "Seller") having an address of 11 Trafalgar
Square, Nashua, New
Hampshire 03063 and Equity Industrial Partners Corp., a
Massachusetts
corporation (the "Buyer") having an address of 145 Rosemary Street,
Suite E,
Needham, Massachusetts 02494.
RECITALS
Seller is the owner of the Property (as defined in Section 2.1
below). Seller
desires to sell the Property to Buyer and Buyer desires to buy the
Property from
Seller, all on and subject to the terms and conditions hereinafter
set forth.
ARTICLE 1
PURCHASE AND SALE AGREEMENT
1.1 AGREEMENT TO
PURCHASE AND SELL.
In consideration of the mutual undertakings and covenants of the
parties set
forth in this Agreement, and for other good and valuable
consideration, the
receipt and legal sufficiency of which are hereby acknowledged,
Seller agrees to
sell the Property to Buyer and Buyer agrees to buy the Property
from Seller on
and subject to the terms and conditions contained in this
Agreement.
1.2 DEFINITIONS.
"Additional Environmental Documents" shall mean the environmental
reports and
other documents to be made available for inspection as set forth on
Schedule
5.5(a).
"Agreement" shall have the meaning set forth in the introductory
paragraph of
this Agreement.
"Appurtenances" shall have the meaning set forth in Section
2.1(b).
"Assigned Contracts" shall have the meaning set forth in Section
4.2(j).
"Assignment of Leases" shall have the meaning set forth in Section
8.2(c).
"Broker" shall have the meaning set forth in Section 10.1.
"Building Condition Report" [INTENTIONALLY DELETED]
"Buyer" shall have the meaning set forth in the introductory
paragraph of this
Agreement.
"Closing" shall have the meaning set forth in Section 8.1.
"Closing Date" shall have the meaning set forth in Section 8.1.
"Cure Period" shall have the meaning set forth in Section 6.1.
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"Deposit" means Five Hundred Thousand Dollars ($500,000.00) to be
paid into
escrow upon the execution and delivery hereof, plus any interest
accrued
thereon.
"Deposit Escrow Agreement" shall have the meaning set forth in
Section 3.2.
"Designee" shall have the meaning set forth in Section 13.1.
"Due Diligence Materials" shall have the meaning set forth in
Section 5.5.
"Eminent Domain Taking" shall have the meaning set forth in Section
9.2.
"Environmental Reports" shall mean the reports to be delivered as
set forth on
Schedule 5.5.
"Escrow Agent" shall mean First American Title Insurance
Company.
"Hazardous Materials" shall have the meaning set forth in Section
4.1(q).
"Improvements" shall have the meaning set forth in Section
2.1(a).
"Inspection Period" [INTENTIONALLY DELETED]
"Intangible Property" shall have the meaning set forth in Section
2.1(f).
"Interim Lease" [INTENTIONALLY DELETED]
"IRS" shall have the meaning set forth in Section 13.1.
"Land" shall have the meaning set forth in Section 2.1(a).
"Leases" shall have the meaning set forth in Section 2.1(g).
"Legal Holiday" means a day that banks in New Hampshire are
regularly closed.
"Monetary Liens" shall have the meaning set forth in Section
6.1.
"Permitted Exception" shall have the meaning set forth in Section
6.1.
"Property" shall have the meaning set forth in Section 2.1.
"Purchase Price" shall have the meaning set forth in Section
3.1.
"Real Property" shall have the meaning set forth in Section
2.1(d).
"Seller" shall have the meaning set forth in the introductory
paragraph of this
Agreement.
"Seller's Knowledge" shall mean the actual, current knowledge,
without
investigation, of John L. Patenaude, Seller's Vice President -
Finance/CFO and
Treasurer.
"Survey" shall have the meaning set forth in Section 6.1.
"Survival Period" shall have the meaning set forth in Section
4.1.
"Title Company" shall mean First American Title Insurance
Company.
"Title Evidence" shall have the meaning set forth in Section
6.1.
"Title Objections" shall have the meaning set forth in Section
6.1.
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ARTICLE 2
THE PROPERTY
2.1 DESCRIPTION OF THE
PROPERTY.
The "Property" consists of the following:
(a) Approximately forty-eight (48) acres of land located at 57 and
59
Daniel Webster Highway, Merrimack, Hillsborough County, New
Hampshire and more
particularly described in Schedule 2.1(a) attached hereto (the
"Land");
(b) all rights, privileges and easements appurtenant to the Land
owned
by Seller, including, without limitation, all minerals, oil, gas,
and other
hydrocarbon substances on and under the Land, as well as all
development rights,
air rights, water, water rights and water stock relating to the
Land, any rights
to any land lying in the bed of any existing dedicated street, road
or alley
adjoining the Land and to all strips and gores adjoining the Land,
and any other
easements, rights-of-way, or appurtenances used in connection with
the
beneficial use and enjoyment of the Land (collectively referred to
as the
"Appurtenances");
(c) all improvements located on the Land, including primarily
two
buildings (collectively, the "Improvements");
(d) The fixtures and equipment used in connection with the
operation
of the Improvements (which fixtures and equipment, together with
the Land,
Appurtenances and Improvements, is collectively referred to as the
"Real
Property");
(e) the tangible personal property, if any, described in
Schedule
2.1(e) attached hereto (the "Personal Property");
(f) all of the interest of Seller to the intangible personal
property,
if any, described on Schedule 2.1(f) attached hereto (the
"Intangible
Property");
(g) all of Seller's interest in the Leases listed on Schedule D
(the
"Leases"); and
(h) all of Seller's interest in the contracts, if any, described
in
Schedule 4.1(f) attached hereto (the "Contracts") to the extent
consent of any
third party is not required.
2.2
LEASE-BACK.
At Closing, Seller and Buyer shall enter into a lease agreement
(the "Nashua
Lease") for approximately 155,503 rentable square feet of the
building located
on the Property at 59 Daniel Webster Highway, in substantially the
form attached
hereto as Schedule 2.2. The Nashua Lease shall provide for a
mutually-agreeable
division of facility and building system management between Buyer
and Seller. At
Closing, Seller shall deliver a budget for operation of the
Improvements
containing reasonable compensation for any management and
maintenance activities
undertaken by Seller. Seller's lenders have conditioned their loans
to Seller in
the course of its business activity on Buyer's entering into a
Collateral Access
Agreement in the form hereto as Schedule 2.2(a), and Buyer shall
execute such
agreement in final form acceptable
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to Buyer, Seller, and LaSalle Bank National Association as
Administrative Agent
for said lenders.
ARTICLE 3
PURCHASE PRICE; DEPOSIT; ADJUSTMENTS
3.1 PURCHASE
PRICE.
On the Closing Date, the Buyer agrees to pay EIGHTEEN MILLION FIVE
HUNDRED
THOUSAND DOLLARS AND NO CENTS ($18,500,000.00) (the "Purchase
Price"), subject
to adjustment and as otherwise provided herein.
3.2 DEPOSIT.
Seller's Attorney holds Buyer's check for $100,000.00. Upon the
execution of
this Agreement, Buyer will deposit with the Escrow Agent the
balance of the
Deposit to secure Buyer's obligations under this Agreement, upon
doing which
Seller's Attorney will return Buyer's check. The Escrow Agent will
maintain the
Deposit and disburse the Deposit pursuant to the terms and
conditions of this
Agreement and the Deposit Escrow Agreement attached hereto as
Schedule 3.2 (the
"Deposit Escrow Agreement").
3.3 BALANCE OF
PURCHASE PRICE.
On the Closing Date Buyer shall pay the Purchase Price less the
Deposit, subject
to the adjustments provided for herein, by wire transfer of
immediately
available federal funds or by cashier's, treasurer's or bank
certified check;
and direct the Escrow Agent to apply the Deposit towards the
Purchase Price.
3.4 PRORATIONS OF
TAXES.
All real and personal property taxes attributable to the year in
which the
Closing occurs shall be prorated and adjusted as of the Closing
Date as an
adjustment at the Closing (regardless of whether such taxes and
special
assessments are then due and payable or delinquent). If the tax
statements for
the fiscal year during which the Closing Date occurs are not
finally determined,
then the tax figures for the immediately prior fiscal year will be
used for the
purpose of prorating taxes on the Closing Date, with a further
adjustment to be
made after the Closing Date as soon as such tax figures are
finalized. All
special assessments which may be amortized over a number of years
will be
prorated as of the Closing Date, with Seller responsible only for
the period
ending on the day prior to the Closing Date. Any tax refunds or
proceeds
(including interest thereon) on account of a favorable
determination resulting
from a challenge, protest, appeal or similar proceeding relating to
taxes and
assessments relating to the Property (i) for all tax periods
occurring prior to
the applicable tax period in which the Closing occurs will be
retained by and
paid exclusively to Seller and (ii) for the applicable tax period
in which the
Closing occurs will be prorated as of the Closing Date after
reimbursement to
Seller and Buyer, as applicable, for all fees, costs and expenses
(including
reasonable attorneys' and consultants' fees) incurred by Seller or
Buyer, as
applicable, in connection with such proceedings such that Seller
will retain and
be paid that portion of such tax refunds or proceeds as is
applicable to the
portion of the applicable tax period prior to the Closing Date and
Buyer will
retain and be paid that portion of such tax refunds or proceeds as
is applicable
to the portion of the applicable tax period from and after the
Closing Date.
After the Closing, Buyer will be responsible for and control any
tax protests or
proceedings for any period for which taxes are adjusted between the
parties
under this
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Agreement and for any later period. Buyer and Seller will cooperate
in pursuit
of any such proceedings and in responding to reasonable requests of
the other
for information concerning the status of and otherwise relating to
such
proceedings; provided, however, that neither party shall be
obligated to incur
any out-of-pocket fees, costs or expenses in responding to the
requests of the
other.
3.5 PRORATIONS OF
CONTRACTS AND PREPAID EXPENSES.
To the extent contracts with respect to the Property are not
terminated pursuant
to Section 4.2(g) below, prepaid or past due amounts under any
Assigned
Contracts will be prorated and adjusted as of the Closing Date.
Buyer will be
charged for those prepaid expenses allocable to any period after
the Closing
Date, including, without limitation, annual permit and confirmation
fees, fees
for licenses and all security or other deposits.
3.6 UTILITIES.
Seller will cause all meters for electricity, gas, water, sewer or
other utility
usage at the Property to be read on the Closing Date. Seller will
pay all
charges for such utility charges which have accrued on or prior to
the Closing
Date provided, however, that if and to the extent such charges are
paid directly
by tenants, no such reading or payment shall be required. If the
utility
companies are unable or refuse to read the meters on the Closing
Date, all
charges for such utility charges to the extent unpaid will be
prorated and
adjusted as of the Closing Date based on the most recent bills.
3.7 RENT
PRORATIONS.
Collected rents for the then current period; and security deposits;
prepaid
rentals; common area maintenance charges; promotional charges;
service charges;
tax charges; and all other incidental expenses and charges paid by
tenants under
the Leases, in each case to the extent collected for the current
period and any
future periods, will be apportioned and full value shall be
adjusted and
prorated as of the Closing Date. Except for any Interim Leases, all
lease
commissions, improvement allowances and improvement commitments
payable or to be
performed, before or after the Closing Date, with respect to the
Leases shall be
charged to Seller as an adjustment at the Closing. Buyer will be
responsible for
lease commissions, improvement allowances and improvement
commitments payable or
to be performed, before or after the Closing Date, with respect to
the Interim
Leases.
3.8 UNCOLLECTED
RENTS.
All rentals and other charges payable in arrears and uncollected
and all other
uncollected rents (including common area maintenance charges,
charges for
services provided by Seller as lessor under the Leases payable by
the tenants
thereunder, and adjustments and reconciliations thereto) for the
current and
prior rental periods, less the reasonable third party out-of-pocket
expenses of
collection thereof, will be apportioned (if and when collected by
either party),
but shall not be adjusted at Closing. As to any tenants that are
delinquent in
the payment of rent on the Closing Date, Buyer shall use reasonable
efforts (but
shall not be required to commence legal action) to collect or cause
to be
collected such delinquent rents following the Closing Date. Any and
all rents so
collected by Buyer following the Closing (less a deduction for all
reasonable
collection costs and expenses incurred by Buyer) will be
successively applied
(x) one-half to the rent then due and payable and (y) one-half to
such unpaid
rent in order of decreasing delinquency. Any rent payment made by a
tenant that
is identified or designated by such tenant as payment of any
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delinquent rent shall be applied to such delinquent rent. If all or
part of any
rents or other charges received by Buyer following the Closing are
allocable to
Seller pursuant to the foregoing sentence, then such sums will be
promptly paid
to Seller. Seller reserves the right to collect delinquent rents
owed to Seller
and to pursue any damages remedy Seller may have against any tenant
with respect
to such delinquent rents, but will have no right to exercise any
other remedy
under any Lease (including, without limitation, termination or
eviction).
3.9 ESTIMATES.
In the event, on the Closing Date, the precise figures necessary
for any of the
foregoing adjustments are not capable of determination, then, at
Seller's
option, those adjustments will be made on the basis of good faith
estimates of
Seller using currently available information, and final adjustments
shall be
made within six (6) months after the Closing Date on the basis of
such precise
figures as have been determined or become available.
3.10 ADJUSTMENT PAYMENTS.
The net amount of all adjustments to be made under this Article 3
will be paid
on the Closing Date in immediately available funds. All
post-closing adjustments
will be made in immediately available funds.
3.11 CALCULATION OF PRORATIONS.
All apportionments and prorations made hereunder shall be made
based on the
number of days of ownership of the Property in the period
applicable to the
apportionment, with Buyer entitled to income and responsible for
expenses for
the Closing Date. Prorations of annual payments will be made based
on the number
of days of ownership in the applicable annual period.
3.12 SELLER'S CLOSING COSTS.
At the Closing, Seller shall pay and be responsible for the amount
due for (i)
one-half of the real estate transfer tax imposed on the total
consideration paid
for the Real Property by RSA 78-B or any other tax or charge
substituted
therefor imposed in connection with the consummation of the
transaction
contemplated hereby; (ii) recording charges for any instrument
which releases or
discharges any lien as required by Article 6 hereto; one-half of
the fees, if
any, charged by Escrow Agent; and (iii) Seller's counsel's fees and
expenses.
3.13 BUYER'S CLOSING COSTS.
At the Closing, Buyer shall pay and be responsible for (i) one-half
of the real
estate transfer tax imposed on the total consideration paid for the
Real
Property by RSA 78-B; (ii) recording charges (other than as listed
in Section
3.13 above); (iii) charges necessary to obtain the survey described
in Section
6.1 below; (iv) charges necessary to obtain the title insurance
policy and all
endorsements thereto described in Section 6.1.1 below; (v) one-half
of the fees,
if any, charged by Escrow Agent; and (vi) Buyer's counsel's fees
and expenses.
3.14 CLOSING STATEMENT.
Seller or Escrow Agent will prepare a draft closing statement at
least two (2)
days prior to the Closing.
3.15 SURVIVAL.
The provisions of Article 3 will survive the Closing.
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ARTICLE 4
REPRESENTATIONS, WARRANTIES, COVENANTS AND AGREEMENTS
4.1 SELLER'S
REPRESENTATIONS AND WARRANTIES.
Seller makes the representations and warranties to Buyer which are
set forth
below, as of the date of this Agreement and as of the Closing Date.
Buyer
acknowledges (i) that Buyer has entered into this Agreement with
the intention
of making and relying upon its own investigation of the physical,
environmental,
economic and legal condition of the Property, and (ii) that, other
than as
specifically set forth below in this Section 4.1, Seller is not
making and has
not at any time made any representation or warranty of any kind or
nature,
either oral or written, directly or indirectly, expressed, implied,
statutory or
otherwise, with respect to the Property, including, without
limitation,
representations or warranties as to habitability, merchantability,
fitness for a
particular purpose, title (other than Seller's limited warranty of
title set
forth in the Warranty Deed), zoning, tax consequences, latent or
patent physical
or environmental condition, health or safety matters, utilities,
operating
history or projections, valuation, projections, the applicability
of any laws,
rules or regulations or compliance therewith. Buyer shall purchase
the Property
on the Closing Date in its "AS IS, WHERE IS AND WITH ALL FAULTS"
condition,
without any representation or warranty whatsoever, including but
not limited to
the condition of the roofs of all buildings in their current
condition, with
equipment attached, as aforesaid, except as set forth in this
Section 4.1.
(a) This Agreement has been duly authorized, executed and delivered
by
Seller and all consents required under Seller's organizational
documents or by
law have been obtained. All documents that are to be executed by
Seller and
delivered to Buyer on the Closing Date have been, or on the Closing
Date will
be, duly executed, authorized and delivered by Seller. This
Agreement and all
such documents are, and on the Closing Date will be, legal, valid
and binding
obligations of Seller, enforceable in accordance with their terms
and do not,
and, at the time of the Closing Date will not, violate any
provisions of any
agreement or judicial or administrative order to which Seller is a
party or to
which Seller or the Property (or any portion thereof) is
subject.
(b) To the best of Seller's Knowledge, except as set forth in
Schedule
4.1(b) attached hereto, there are no actions, suits or proceedings
(including
arbitration proceedings) pending or to the best of Seller's
Knowledge,
threatened against Seller which could have a material adverse
effect on any
portion of the Property, Seller's interest therein, or Seller's
ability to
perform its obligations hereunder, at law or in equity or before or
by any
federal, state, municipal or other governmental department,
commission, board,
bureau, agency or instrumentality.
(c) To the best of Seller's Knowledge, there is no pending
condemnation action against the Property.
(d) There are no
leases, licenses, occupancy or related agreements or
tenancies affecting the Property other than the Leases.
(e) The copies of the Leases Seller has delivered or shall
deliver
hereunder are true, accurate and complete.
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(f) Except as listed on Schedule 4.1(f) there are no material
contracts or agreements related to the use, ownership or operation
of the
Property. The copies of the contracts listed on Schedule 4.1(f)
Seller has
delivered or shall deliver hereunder are true, accurate and
complete;
(g) Except as described in the Environmental Reports listed on
Schedule 5.5 and the Additional Environmental Documents listed on
Schedule
5.5(a), Seller's use of hazardous materials in its operations at
the Property
have not, to the best of Seller's Knowledge, resulted in releases
of
contaminants at the Property in violation of state or federal
environmental
standards.
(h) Seller is
not a foreign corporation, foreign partnership or
foreign estate (as such terms are defined in Section 1445 of the
Internal
Revenue Code). Seller shall provide Buyer with an affidavit to this
effect at
Closing in the form provided on Schedule 8.2(h).
(i) Except as described in the Environmental Reports listed on
Schedule 5.5 and the Additional Environmental Documents listed on
Schedule
5.5(a), Seller has not received any notice of material violations
of legal
requirements from any governmental authority.
The
representations and warranties contained herein may be relied upon
by
the party receiving the same and shall survive the Closing Date for
a period of
twelve (12) months from and after the Closing Date (the "Survival
Period"). In
the event a written claim is made within the Survival Period, the
Survival
Period shall toll with respect to such claim while such claim is
outstanding.
Buyer shall not make any claim on account of a breach of
representations or
warranties unless and until the aggregate measure of such claims
exceeds two
percent (2%) of the Purchase Price. In no event shall the aggregate
liability
for Seller to Buyer for any breach of any representation or
warranty set forth
in this Section 4.1 exceed the Purchase Price.
4.2 SELLER'S
COVENANTS.
Seller hereby covenants and agrees with Buyer that:
(a) At all times from the execution of this Agreement to the
Closing
Date, it shall maintain the Property in substantially the same
condition as the
same is in as of the date of this Agreement, subject only to
reasonable use and
wear and the terms of Article 9 hereof.
(b) At all times from the execution of this Agreement to the
Closing
Date, it shall maintain such casualty insurance on the Improvements
as is
presently carried.
(c) From and after the date hereof through the Closing Date,
Seller
shall not (i) enter into any leases affecting the Property or any
portion
thereof or (ii) cancel, terminate, extend or materially modify the
terms of any
Lease or Permitted Exception, (iii) apply any security deposit;
(iv) enter into
any other agreements with respect to the sale or long term lease of
the Property
or any portion thereof, or (v) take any action that will encumber
the Property
after Closing, in each case without the prior written consent of
Buyer.
(d) From and after the date hereof through the Closing Date,
Seller
shall not enter into any new contracts or agreements or place any
encumbrance on
the Property, if such
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contract or encumbrance would survive the Closing hereunder,
without the prior
written consent of Buyer.
(e) Seller agrees to terminate as of the Closing Date, any
property
management, leasing brokerage and service contract or agreement
relating to the
Property unless Buyer requests otherwise, by written notice to
Seller prior to
the expiration of the Inspection Period. Any service contracts or
agreements
which are designated by Buyer as contracts or agreements which
should not be
terminated shall be assigned, which assignment shall be without
recourse to
Seller, to Buyer at Closing (the "Assigned Contracts").
(f) Seller shall prepare tenant estoppel certificates for each
tenant
in the form of Schedule 4.2(f) attached hereto and submit the same
to all
tenants.
(g) Seller shall assign, which assignment shall be without recourse
to
Seller, all warranties relating to the Property to Buyer at
Closing.
(h) At Closing, Seller shall execute a Post-Closing Remediation
Agreement in the form attached as Schedule 4.2(h).
4.3 BUYER'S
REPRESENTATIONS AND WARRANTIES.
Buyer hereby represents and warrants to Seller as of the date of
this Agreement
and as of the Closing Date that this Agreement has been duly
authorized,
executed and delivered by Buyer and all consents required under
Buyer's
organizational documents or by law have been obtained. All
documents that are to
be executed by Buyer and delivered to Buyer on the Closing Date
have been, or on
the Closing Date will be, duly executed, authorized and delivered
by Buyer. This
Agreement and all such documents are, and on the Closing Date will
be, legal,
valid and binding obligations of Buyer, enforceable in accordance
with their
terms and do not, and, at the time of the Closing Date will not,
violate any
provisions of any agreement or judicial or administrative order to
which Buyer
is a party or to which Buyer is subject.
4.4 HAZARDOUS
MATERIALS INDEMNITIES.
Seller shall indemnify Buyer, Buyer's lenders and their respective
successors
and assigns against all costs and damages (including reasonable
attorney's fees)
resulting from (i) the environmental condition of the Real Property
as of the
Closing Date; (ii) any environmental contamination of the Real
Property after
the Closing Date to the extent the same is due to any act or
omission of Seller
or any affiliate of Seller or any of their respective employees,
contractors,
invitees, representatives or agents; or (iii) Seller's breach of
the
Post-Closing Remediation Agreement to be executed pursuant to
Section 4.2(h).
This indemnity is conditioned on Buyer:
(a) providing written notice to Seller of any claim or action
within
the
earlier of (1) thirty (30) days of the receipt of notice by Buyer
of
any
present or pending claim or action with respect to
environmental
conditions at the Real Property, or the incurring of any cost
related to
the
same, or (2) fourteen (14) days prior to the due date of any
required
filing or notice with a court or other governmental agency,
including but
not
limited to any appearance, answer or other pleading, related to
such
claim or action;
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(b) permitting Seller to control all communications with the
proponent
of
any such claim or action and to make all decisions, including
(without
limitation) any decision on choice of counsel, settlement or
compromise,
with
respect to the defense of the same, provided that without
limiting
Seller's discretion and control, Seller shall use reasonable
efforts to
keep
Buyer informed on the status of such claim or action and to
consider
Buyer's timely-submitted views on settlement or compromise of such
claim or
action;
(c) cooperating with Seller in the defense of any claim or
action,
including (without limitation) providing any and all necessary
access to
areas of the Real
Property not leased by Seller; and
(d) providing notice of the provisions of this Section 4.4 in
any
transfer of the Real Property.
The provisions of this Section 4.4 shall survive the Closing or any
earlier
termination of this Agreement.
ARTICLE 5
ACCESS, INSPECTION, DILIGENCE
5.1 INSPECTIONS.
Seller agrees that Buyer and its authorized agents or
representatives shall be
entitled to enter upon the Real Property and the Improvements
during normal
business hours upon forty-eight (48) hours advance written notice
to Seller to
make such investigations, studies and tests, including tenant
interviews,
surveys, and engineering studies, as Buyer deems necessary or
advisable, subject
to the conditions of this Article 5 and the Access and Indemnity
Agreement
between the parties dated August 1, 2006 and attached as Schedule
5.1.
5.2 PROPERTY
INVESTIGATIONS
All investigations made by Buyer will be at Buyer's sole cost and
expense, will
be performed without causing any damage to the Property and without
undue
interference with the normal business operations of the Premises,
including
without limitation, the rights of tenants at the Property, and will
be performed
in the presence of one or more of Seller's representatives. Buyer
shall not
cause any adverse impact to the Property and will restore the
Property in a
timely manner at Buyer's sole cost to the condition that existed
immediately
prior to the Property Investigations. The investigations may
consist of, without
limitation, (1) an update of the Survey; (2) a structural
investigation of the
Improvements and a resulting Building Condition Report; and (3) a
Phase I
Environmental Site Assessment satisfying ASTM standards and
satisfactory to
Buyer (all investigations of the Property or any materials
regarding the
ownership, management, use or operation of the Property are
collectively called
the "Property Investigations"). With respect to any invasive
Property
Investigations (e.g. Phase II environmental site assessments),
Buyer will obtain
Seller's advance approval of the scope of any proposed activities,
particularly
as they may involve the investigations of ground water or
subsurface soil
conditions, and allow one or more of Seller's representatives to be
present
during
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any such activities. Buyer will promptly provide Seller, at
Seller's request,
with a copy of any report, draft report or evaluation ("Reports")
which
indicates the presence of hazardous substances on the Property or
the violation
of any applicable law, or any other Report prepared in connection
with the
Property investigations. Except as specifically provided below,
Buyer agrees to
keep confidential and not to disclose the results of its Property
Investigations
or the contents of any Reports.
5.3 DISCLOSURE. In the event that Buyer determines that Buyer is
required by
applicable law to notify a federal, state or local governmental
agency or any
other party with respect to the conditions at the Property as a
result of any
Property Investigation, Buyer shall immediately notify Seller and
Seller shall
make such disclosure as Seller determines appropriate. If Seller
determines not
to notify such public agency or other party after such notice and
Buyer feels
that Buyer is still required by law to make such disclosure and so
notify
Seller, Seller will hire an independent consultant reasonably
approved by Buyer
to make the determination for Seller of whether such public
disclosure is
required and such determination will be binding up
